CW Bancorp Reports Q2 2021 EPS up 189% and ROTE of 17.3%

Irvine, California – July 20, 2021 – CW Bancorp, the parent company (“the Company”) of CommerceWest Bank (the “Bank”) reported consolidated net income for the second quarter of 2021 of $2,981,000 or $0.81 a share as compared to $1,017,000 or $0.28 a share for the second quarter of 2020, an EPS increase of 189%. Net income for the six months ended June 30, 2021 was $6,628,000 or $1.80 a share as compared to $2,140,000 or $0.58 a share for the six months ended June 30, 2020, an EPS increase of 210%.

Key Financial Results for the three months ended June 30, 2021:

  • Net income growth of 193%
  • EPS of $0.81 up 189%
  • ROA of 1.03% up 102%
  • ROTE of 17.28% up 162%
  • Total asset growth up 27%
  • Noninterest bearing deposit growth up 41%
  • Efficiency ratio of 47.28%
  • Noninterest income up 39%
  • 46 quarters of consecutive profits

Key Financial Results for the six months ended June 30, 2021:

  • Net income growth of 210%
  • EPS of $1.80 up 210%
  • ROA of 1.15% up 85%
  • ROTE of 19.33% up 179%
  • Efficiency ratio of 44.25%
  • Cost of deposit of 0.11% down 71%
  • Zero nonperforming loans
  • ALLL to total loans ratio (net of PPP loans) of 1.71%
  • Noninterest-bearing deposits as percent of total deposits at 61%

Mr. Ivo Tjan, Chairman and CEO said, “The Company had solid performance for the quarter, with net income growth in the triple digits for both the quarter and year to date.  In addition, credit quality remains strong.  We continue to have good growth in non-interest bearing deposits up 41%, which equates to 61% of our total deposits.”  Mr. Tjan continued, “Our digital banking model has been a benefit for our existing clients, new clients and attracting new employees to the Bank.  Our company is focused on growing our loan pipeline for the remainder of 2021 to assist businesses with their growth plans, as the local economy continues to reopen.  This is an indication of the confidence we have in our future and that of our clients.”

Total assets increased $250 million as of June 30, 2021, an increase of 27% as compared to the same period one year ago. Total loans increased $39 million as of June 30, 2021, an increase of 6% over the prior year. Cash and due from banks increased $180 million or 82% from the prior year.  Total investment securities increased $21 million, an increase of 30% from the prior year.

Total deposits increased $202.7 million as of June 30, 2021, an increase of 24% from June 30, 2020.  Non-interest-bearing deposits increased $184.7 million as of June 30, 2021, an increase of 41% over the prior year.  Interest bearing deposits increased $18 million as of June 30, 2021, an increase of 5% over the prior period. 

Interest income was $7,149,000 for the three months ended June 30, 2021as compared to $6,568,000 for the three months ended June 30, 2020, an increase of 9%. Interest income was $14,717,000 for the six months ended June 30, 2021 as compared to $12,819,000 for the six months ended June 30, 2020, an increase of 15%. Interest expense was $583,000 for the three months ended June 30, 2021 as compared to $430,000 for the three months ended June 30, 2020, an increase of 36%. Interest expense was $955,000 for the six months ended June 30, 2021 as compared to $1,199,000 for the six months ended June 30, 2020, a decrease of 20%.  

Net interest income for the three months ended June 30, 2021 was $6,566,000 as compared to $6,138,000 for the three months ended June 30, 2020, an increase of 7%.  The net interest margin decreased for the three months ended June 30, 2021.  It decreased from 3.21% in 2020 to 2.38% in 2021, a decrease of 26%, largely due to PPP loans which are earning 1.0% interest. Net interest income for the six months ended June 30, 2021 was $13,762,000 as compared to $11,620,000 for the six months ended June 30, 2020, an increase of 18%. The net interest margin decreased for the six months ended June 30, 2021.  It decreased from 3.50% in 2020 to 2.49% in 2021, a decrease of 29%.

There was no provision for loan losses for the three months ended June 30, 2021 compared to $2,450,000 for the three months ended June 30, 2020, a decrease of 100%. The allowance for loan losses (net of PPP loans) to total loans ratio increased from 1.63% as of June 30, 2020 to 1.71% as of June 30, 2021, an increase of 5%.

Non-interest income for the three months ended June 30, 2021 was $1,283,000 compared to $922,000 for the same period last year, an increase of 39%. Non-interest income for the six months ended June 30, 2021 was $2,389,000 compared to $2,071,000 for the same period last year, an increase of 15%.  

Non-interest expense for the three months ended June 30, 2021 was $3,711,000 compared to $3,257,000 for the same period last year, an increase of 14%. Non-interest expense for the six months ended June 30, 2021 was $7,209,000 compared to $6,546,000 for the same period last year, an increase of 10%.

The efficiency ratio for the three months ended June 30, 2021 was 47.28% compared to 45.51% in 2020, which represents an increase of 4%.   The efficiency ratio illustrates that for every dollar made for the three-month period ending June 30, 2021, it cost $0.47 to make it, as compared to $0.46 one year ago. The Bank’s efficiency ratio for the six months ended June 30, 2021 was 44.25% compared to 47.21% in 2020, which represents a decrease of 6%.

Capital ratios for the Bank remain above the levels required for a “well capitalized” institution as designated by regulatory agencies.  As of June 30, 2021, the tier 1 leverage ratio was 8.02%, the common equity tier 1 capital ratio was 15.00%, the tier 1 risk-based capital ratio was 15.00% and the total risk-based capital ratio was 16.25%.

CommerceWest Bank is a California based full-service business bank with a unique vision and culture of focusing exclusively on the business community by delivering on customized products and services.  Founded in 2001 and headquartered in Irvine, California, the Bank serves businesses throughout the state of California.   We provide a wide range of commercial banking services, including, remote deposit solution, online bankingmobile bankinglines of credit, M&A / working capital loans, commercial real estate loans, SBA loans and treasury management services.

Mission Statement: CommerceWest Bank will create a complete banking experience for each client, catering to businesses and their specific banking needs, while accommodating our clients and providing them high-quality, low stress and personally tailored banking and financial services. 

Please visit www.cwbk.com to learn more about the bank.  “BANK ON THE DIFFERENCE”

Statements concerning future performance, developments or events, expectations for growth and income forecasts, and any other guidance on future periods, constitute forward-looking statements that are subject to a number of risks and uncertainties.  Actual results may differ materially from stated expectations.  Specific factors include, but are not limited to, loan production, balance sheet management, expanded net interest margin, the ability to control costs and expenses, interest rate changes, financial policies of the United States government and general economic conditions.  The Company disclaims any obligation to update any such factors or to publicly announce the results of any revisions to any forward-looking statements contained in this release to reflect future events or developments.