Commencement Bancorp, Inc. (CBWA) Announces 2024 First Quarter Earnings

2024 First Quarter Financial Highlights:

• Total loans ended the quarter at $446.8 million, a $11.7 million increase year-over-year.
• Interest income increased 13% year-over-year to $6.9 million.
• Non-interest income recognized an 8% increase compared to one year earlier.
• Eliminated all borrowed funds and brokered certificates of deposit from first quarter 2023 to first quarter 2024.
• Nonperforming assets to total assets decreased to 0.09% from 0.45% compared to one year earlier.
• Tangible book value per share increased from $12.11 in first quarter 2023 to $12.29 in first quarter 2024.
• Capital ratios remained well above regulatory requirements.

TACOMA, WA / ACCESSWIRE / May 10, 2024 / Commencement Bancorp, Inc. (OTCQX:CBWA) reported quarterly net income of $738 thousand, or $0.19 per share, for the quarter ending March 31, 2024, compared to $720 thousand and $0.18 per share for first quarter 2023. Total non-interest income increased 8%, while non-interest expense recorded an increase of 13% year-over-year. As stated during recent quarters, the Bank has continued with expansion plans and technology upgrades resulting in higher-than-normal expenses. Additionally, the Bank recorded a $440 thousand extraordinary expense for accrued legal fees that were reclassified following the settlement of two nonperforming credits in late 2023.

A $500K reverse provision from the Bank's Allowance for Credit Losses (ACL) was recognized in first quarter 2024. During 2023, the Bank successfully recovered $711 thousand from previously recorded loan losses. Given the overall portfolio performance, expected future loan growth, and significant recoveries, the ACL was overallocated and the recapture of the reserves brought the ACL coverage in line with allowance methodology and the Bank's peers.

"Our loan portfolio continues to perform well under the stresses of higher interest rates. Based on that performance and the significant recoveries collected in 2023, the ACL was overallocated. The recapture of the funds brings our loan loss reserves in line with our allowance methodology and the Bank's peers," said John E. Manolides, Chief Executive Officer.

Total assets ended the quarter at $590 million with no significant variation to report. Total loan balances were $447 million at quarter end, an increase of 3%, or $12 million, compared to first quarter 2023. Asset quality improved based on net recoveries, which resulted in an improved Texas Ratio (a measurement of problem loans and bank-owned properties to capital) of 0.7% compared to 4.0% one year prior.