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Coronado First Bank Reduces Non-Performing Loans by 45% in Second Quarter

^{Published on 2010-07-28 08:40:42 - Market Wire}
 

CORONADO, Calif.--([ BUSINESS WIRE ])--Bruce Ives, President and CEO of Coronado First Bank (the aBanka) (OTCBB: CDFB), announced unaudited financial results for the second quarter ending June 30, 2010, highlighting the Banka™s 45% reduction in non-performing loans.

"Our focus on cleaning up our non-performing assets (NPAa™s) hit its stride in the second quarter as the Bank reaped the benefits of our aggressive strategy to successfully resolve NPAs. As a result, we ended the quarter with $0 OREO and 3 NPAa™s totaling $4,364,000"

aOur focus on cleaning up our non-performing assets (NPAa™s) hit its stride in the second quarter as the Bank reaped the benefits of our aggressive strategy to successfully resolve NPAs. As a result, we ended the quarter with $0 OREO and 3 NPAa™s totaling $4,364,000,a Ives said.

As of June 30, 2010, total assets were $97 million and total deposits $87 million, an increase of 1% and 4% over June 30, 2009, respectively. Total net loans declined 15% to $68 million, reflecting the loan pay-offs and the reduction in non-performing loans through sales and write-downs.

The Bank reported a second quarter loss of $275,000 ($0.20 diluted loss per share) and a six month loss of $210,000 ($0.15 diluted loss per share) compared with a loss of $111,000 for the six month period ended June 30, 2009. Earnings from operations before the disposal of OREO and write-offs for the first half of the year were $141,000 ($0.10 diluted earnings per share).

aWhile the Bank experienced a loss in the second quarter, we were successful in reducing our non-performing and OREO assets by 45% or $3,529,000, and we expect to resolve the remaining NPAa™s by year-end with maximum effort being placed on minimizing losses,a Ives said. At June 30^th, Loan Loss Reserves totaled $1,582,000, or 2.26 % of loans outstanding.

At June 30, 2010, the Banka™s capital ratios remain well above the minimum ratios for a well-capitalized bank based on regulatory minimum guidelines.

The Bank continued to improve its core deposit position, one of its primary objectives for 2010, and at June 30, core deposits represented 72% of the deposit base. The growth in core deposits, which generally represent a more stable source and lower cost of funds, resulted in a significant reduction in the Banka™s cost of funds to 1.07% at quarter-end June 30, 2010. Non-Interest bearing accounts now represent 19% of total deposits as compared to 15% at June 30, 2009. Compared with the first half of 2009, net interest income (the Banka™s primary revenue source) increased by 10.4% despite the reduction in loan outstandings. The Banka™s net interest margin was 4.15% as of June 30, 2010.

Ives said, aThe Banka™s board of directors and management recognize the continuing constraints of a volatile economic environment and are committed to mitigating risk and maintaining the integrity of the Banka™s balance sheet. We will continue to monitor our loan portfolio, actively address loan problems and adjust our balance sheet composition to position ourselves for consistent returns in the future.a

Ives remains focused on the 2010 goals of:

1. Reducing non-performing assets.
2. Managing and reducing the percentage of construction and other commercial real estate loans.
3. Increasing core deposits.
4. Achieving consistent earnings.

Ives concluded, aAs stated previously, 2010 will be a volatile year for many banks as institutions continue to work through problem assets and manage the harsh realities of increased regulatory requirements. Wea™re cautiously optimistic about achieving our goals for 2010 and generating consistent returns for our shareholders in the future. As always, we appreciate our shareholders support as we continue to direct the Bank with long term shareholder value as our primary objective.a

Coronado First Bank is publicly traded on the Over-the-Counter Bulletin Board, ticker symbol: aCDFB.a

This press release includes forward-looking statements that involve inherent risks and uncertainties. Coronado First Bank cautions readers that a number of important factors could cause actual results to differ materially from those in the forward-looking statements. These factors include economic conditions and competition in the geographic and business areas in which Coronado First Bank operates, inflation, fluctuations in interest rates, legislation and governmental regulation. We make no promise to update any forward-looking statement, whether as a result of changes in underlying factors, new information, future events or otherwise.