CBB Bancorp, Inc. Reports Fourth Quarter 2024 Financial Results

LOS ANGELES--(BUSINESS WIRE)--CBB Bancorp, Inc. ("CBB" or the "Company') (OTCQX: CBBI), the holding company of Commonwealth Business Bank, doing business as “CBB Bank” (the "Bank"), announced today net income of $5.7 million for the fourth quarter 2024, or $0.54 per diluted share compared to $5.6 million in the third quarter 2024, or $0.53 per diluted share.

Additionally, CBB reported net income for the year ended December 31, 2024 of $22.4 million, or $2.12 per diluted share compared to $28.9 million, or $2.72 per diluted share of net income for the year ended December 31, 2023.

OVERALL RESULTS

Net income for the fourth quarter 2024 increased from the previous quarter primarily on higher net interest income and lower noninterest expenses. The return on average assets for the fourth quarter 2024 was 1.27% compared to 1.31% for the third quarter 2024 and 1.54% for the fourth quarter 2023. The return on average equity for the fourth quarter 2024 was 8.98% compared to 8.91% for the third quarter 2024 and 11.94% for the fourth quarter 2023. The net interest margin for the fourth quarter 2024 was 3.55% compared to 3.71% for the third quarter 2024 and 3.86% for the fourth quarter 2023. The efficiency ratio for the fourth quarter 2024 was 55.66% compared to 56.61% for the third quarter 2024 and 49.45% for the fourth quarter 2023.

James Hong, President and CEO, said, "We are pleased to announce a solid performance in 2024, despite facing challenges with net interest margin due to rising costs on interest-bearing accounts. Our fourth-quarter results highlight the bank’s resilience, with notable increases in both deposits and loan originations. Throughout the year, we saw a significant boost in noninterest income from loan sales, driven by improved market premiums.” He added, “We are excited to announce the appointment of Alex Ko as our new Chief Operating Officer. With his extensive experience and proven track record in the banking industry, Alex is poised to drive significant growth and innovation at our bank. We are confident that his leadership will enhance our operational efficiency and contribute to our long-term success.”

INCOME STATEMENT

Net Interest Income

Net interest income for the fourth quarter 2024 was $15.6 million, an increase of $172 thousand or 1.1%, quarter over quarter, but a decrease of $1.5 million or 8.8%, compared to the fourth quarter 2023.

Net interest income for the twelve months ended on December 31, 2024 was $62.3 million, a decrease of $10.7 million, or 14.6%, compared to the same period last year. The decrease in net interest income was due, in part, to increase in the cost of interest-bearing deposits as maturing time deposits were rolled over into higher interest rate CDs during 2024. Also, the yield on variable rate loans and short-term investments decreased as the Fed cut policy rate by one percent starting in September of 2024.

Net Interest Margin

The net interest margin for the fourth quarter 2024 was 3.55% compared to 3.71% for the third quarter 2024 and 3.86% for the fourth quarter 2023. The cost of funds for the fourth quarter 2024 was 3.45% compared to 3.60% in the third quarter and 3.20% for the fourth quarter of 2023.

Provision for Credit Losses

No provision for credit losses was recorded for the fourth quarter 2024 compared to a negative $100 thousand in the third quarter 2024. No provision for credit losses was recorded in the fourth quarter 2023.

Noninterest Income

Noninterest income for the fourth quarter 2024 was $2.2 million compared to $2.2 million for the third quarter 2024 and increased by $246 thousand compared to $2.0 million for the fourth quarter 2023.

Noninterest income for the twelve months ended December 31, 2024 was $9.3 million, an increase of $2.0 million compared to the same period last year. The increase was due to a combination of a higher gain on sale of loans, higher SBA servicing fee income, and other banking service fees.

Noninterest Expenses

Noninterest expenses for the fourth quarter 2024 were $9.9 million compared to $10.0 million for the third quarter 2024 and $9.5 million for the fourth quarter 2023. Noninterest expenses decreased $76 thousand quarter over quarter on lower salaries and benefits, marketing, and professional fee expenses offset by higher occupancy and fixed asset expenses.

Noninterest expenses for the twelve months ended on December 31, 2024 were $39.9 million, a decrease of $228 thousand or 0.6%, compared to the same period last year.

Please refer to financial tables in this press release for additional information and trends.

Income Taxes

The Company’s effective tax rate for the fourth quarter 2024 was 27.9% compared to 28.4% for third quarter 2024 and 27.6% for fourth quarter 2023.

BALANCE SHEET

Investment Securities

Investment securities were $62.2 million at December 31, 2024, a decrease of $1.0 million or 1.6% from September 30, 2024, and an increase of $2.3 million or 3.9% from December 31 2023.

Loans Receivable

Loans receivable, including loans held-for-sale, at December 31, 2024 was $1.44 billion, an increase of $17.1 million or 1.2% from September 30, 2024, and increased $15.7 million or 1.1% from December 31, 2023.

Allowance for Credit Losses and Asset Quality

The Allowance for Credit Losses (“ACL”) at December 31, 2024 was $16.0 million which was 1.29% of loans held-for-investment compared to $15.9 million or 1.30% of loans held-for-investment at September 30, 2024. At December 31, 2023, ACL was $15.3 million, or 1.27% of total loans held-for-investment.

Total nonperforming assets at December 31, 2024 were $12.1 million compared to $8.6 million at September 30, 2024 and $2.5 million at December 31, 2023. The ACL coverage to nonperforming assets was over 132% at December 31, 2024.

SBA Loans Held-for-Sale

Total SBA loans held-for-sale at December 31, 2024 were $198.4 million compared to $ 198.0 million September 30, 2024, and $218.3 million at December 31, 2023.

The Bank sold $17.2 million in SBA loans with an average premium of 9.2% in the fourth quarter 2024 compared to the sale of $20.2 million with an average premium of 7.5% in the third quarter 2024. The Bank sold $21.7 million of SBA loans with an average premium of 6.7% in the fourth quarter 2023.

Deposits

Total deposits were $1.48 billion at December 31, 2024, up $33.0 million or 2.3% from September 2024, and up $27.0 million or 1.9% from December 2023.

Borrowings

The Bank maintains $50.0 million in Federal Home Loan Bank advances and there was no change from the previous quarter.

Capital

Stockholders’ equity was $255.0 million at December 31, 2024, which increased $4.4 million or 1.8%, quarter over quarter. Tangible book value per share at December 31, 2024 was $23.85, an increase of $0.41, or 1.8%, quarter over quarter.

The following are the Company’s and the Bank’s regulatory capital ratios at December 31, 2024.

The Common Equity Tier1 Risk-Based Capital Ratios at December 31, 2024 were 19.02% and 18.95% for the Company and the Bank, respectively. Total Risk-Based Capital Ratios were 20.23% and 20.16% for the Company and the Bank, respectively. Bank’s Leverage Ratios were 14.12% and 14.07% for the Company and the Bank, respectively. The Bank is considered “Well Capitalized” under the applicable regulatory capital rules.

About CBB Bancorp, Inc.:

CBB Bancorp, Inc. is the holding company of Commonwealth Business Bank, a full-service commercial bank which specializes in loans to small-to-medium-sized businesses and does business as “CBB Bank.” As of December 31, 2024, the Bank had eleven full-service banking offices in Los Angeles and Orange Counties in California, Dallas County in Texas and Honolulu, Hawaii. Two SBA regional offices in Los Angeles and Dallas Counties; and loan production offices in Georgia and Washington. For additional information, please go to www.cbb-bank.com under the tab “About Us” and select “Investor Relations” to see the 4Q 2024 Overview.

FORWARD-LOOKING STATEMENTS:

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. CBB Bancorp, Inc. (the “Company”) intends that such forward-looking statements be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Future events are difficult to predict, and the expectations described herein are necessarily subject to risks and uncertainties that may cause actual results to differ materially and adversely from those described herein. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. Factors that might cause actual results to differ materially from those presented, either expressed or implied, in this news release include, but are not limited to: the Company’s ability to successfully execute its business plans and achieve its objectives; changes in general economic and financial market conditions, either nationally or locally in areas in which the Company conducts its operations; changes in interest rates; continuing consolidation in the financial services industry; new litigation or changes in existing litigation; increased competitive challenges and expanding product and pricing pressures among financial institutions; legislation or regulatory changes which adversely affect the Company’s operations or business; loss of key personnel; and changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies.

The Company undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances, except to the extent required by law.

STATEMENT OF INCOME AND PERFORMANCE HIGHLIGHT (Unaudited) - Table 1
	(Dollars in thousands, except per share amounts)

		Three Months Ended																			Twelve Months Ended
		December 31,			September 30,			$			%		December 31,			$			%		December 31,			December 31,			$			%
		2024			2024			Change			Change		2023			Change			Change		2024			2023			Change			Change

Interest income		$	28,769		$	28,380		$	389		1.4	%	$	29,624		$	(855	)	(2.9	%)	$	113,367		$	114,986		$	(1,619	)	(1.4	%)
Interest expense			13,121			12,904			217		1.7	%		12,462			659		5.3	%		51,071			42,002			9,069		21.6	%
Net interest income			15,648			15,476			172		1.1	%		17,162			(1,514	)	(8.8	%)		62,296			72,984			(10,688	)	(14.6	%)

Provision for credit losses						(100	)		100		(100.0	%)		-			-		100.0	%		500			-			500		100.0	%
Net interest income after provision for credit losses			15,648			15,576			72		0.5	%		17,162			(1,514	)	(8.8	%)		61,796			72,984			(11,188	)	(15.3	%)

Gain on sale of loans			1,013			991			22		2.2	%		838			175		(378.9	%)		4,557			3,209			1,348		42.0	%
Gain (loss) on sale of OREO			-			-			-		-			-			-		-			-			-			-		-
SBA servicing fee income, net			654			760			(106	)	(13.9	%)		690			(36	)	(5.2	%)		2,815			2,423			392		16.2	%
Recovery on impaired servicing liability			-			-			-		-			-			-		-			10			-			10		100.0	%
Service charges and other income			543			465			78		16.8	%		436			107		24.5	%		1,940			1,643			297		18.1	%
Noninterest income			2,210			2,216			(6	)	(0.3	%)		1,964			246		12.5	%		9,322			7,275			2,047		28.1	%

Salaries and employee benefits			5,635			5,884			(249	)	(4.2	%)		5,356			279		5.2	%		23,470			22,585			885		3.9	%
Occupancy and equipment			1,280			1,149			131		11.4	%		1,128			152		13.5	%		4,665			4,477			188		4.2	%
Marketing expense			285			423			(138	)	(32.6	%)		250			35		14.0	%		1,513			1,508			5		0.3	%
Professional expense			329			456			(127	)	(27.9	%)		360			(31	)	(8.6	%)		1,637			1,693			(56	)	(3.3	%)
Other expenses			2,411			2,104			307		14.6	%		2,363			48		2.0	%		8,571			9,821			(1,250	)	(12.7	%)
Noninterest expense			9,940			10,016			(76	)	(0.8	%)		9,457			483		5.1	%		39,856			40,084			(228	)	(0.6	%)

Income before income tax provision			7,918			7,776			142		1.8	%		9,669			(1,751	)	(18.1	%)		31,262			40,175			(8,913	)	(22.2	%)

Income tax provision			2,211			2,207			4		0.2	%		2,670			(459	)	(17.2	%)		8,834			11,315			(2,481	)	(21.9	%)

Net income		$	5,707		$	5,569		$	138		2.5	%	$	6,999		$	(1,292	)	(18.5	%)	$	22,428		$	28,860		$	(6,432	)	(22.3	%)

Effective tax rate			27.92	%		28.38	%		-0.46	%	-1.62	%		27.61	%		0.31	%	1.12	%		28.26	%		28.16	%		0.09	%	0.33	%

Outstanding number of shares			10,588,136			10,588,136			-		-			10,588,136			-		-			10,588,136			10,588,136			-		-

Weighted average shares for basic EPS			10,588,136			10,588,136			-		-			10,588,136			-		-			10,588,136			10,585,191			2,945		0.0	%
Weighted average shares for diluted EPS			10,598,476			10,596,039			2,437		0.0	%		10,588,937			9,539		0.1	%		10,594,400			10,594,055			345		0.0	%

Basic EPS		$	0.54		$	0.53		$	0.01		1.9	%	$	0.66		$	(0.12	)	(18.2	%)	$	2.12		$	2.73		$	(0.61	)	-22.3	%
Diluted EPS		$	0.54		$	0.53		$	0.01		1.9	%	$	0.66		$	(0.12	)	(18.2	%)	$	2.12		$	2.72		$	(0.60	)	(22.1	%)

Return on average assets			1.27	%		1.31	%		(0.04	%)	(3.1	%)		1.54	%		(0.27	%)	(17.5	%)		1.30	%		1.59	%		(0.29	%)	(18.2	%)
Return on average equity			8.98	%		8.91	%		0.07	%	0.8	%		11.94	%		(2.96	%)	(24.8	%)		9.12	%		12.92	%		(3.80	%)	(29.4	%)

Efficiency ratio¹			55.66	%		56.61	%		(0.95	%)	(1.7	%)		49.45	%		6.21	%	12.6	%		55.65	%		49.94	%		5.71	%	11.4	%
Yield on interest-earning assets²			6.52	%		6.80	%		(0.28	%)	(4.1	%)		6.65	%		(0.13	%)	(2.0	%)		6.72	%		6.48	%		0.24	%	3.7	%
Cost of funds			3.45	%		3.60	%		(0.15	%)	(4.2	%)		3.20	%		0.25	%	7.8	%		3.51	%		2.69	%		0.82	%	30.5	%
Net interest margin²			3.55	%		3.71	%		(0.16	%)	(4.3	%)		3.86	%		(0.31	%)	(8.0	%)		3.70	%		4.12	%		(0.42	%)	(10.2	%)

¹ Represents the ratio of noninterest expense less other real estate owned operations to the sum of net interest income before provision for credit losses and total noninterest income.
² Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate

BALANCE SHEET, CAPITAL AND OTHER DATA (Unaudited) - Table 2
(Dollars in thousands)

		December 31,			September 30,			$			%		December 31,			$			%
		2024			2024			Change			Change		2023			Change			Change
ASSETS
	Cash and due from banks	$	10,336		$	14,892		$	(4,556	)	(30.6	%)	$	14,282		$	(3,946	)	(27.6	%)
	Interest-earning deposits at the FRB and other banks		266,826			241,094			25,732		10.7	%		233,255			33,571		14.4	%
	Investment securities¹		62,196			63,208			(1,012	)	(1.6	%)		59,883			2,313		3.9	%
	Loans held-for-sale		198,448			198,021			427		0.2	%		218,258			(19,810	)	(9.1	%)

	Loans held-for-investment		1,239,564			1,222,865			16,699		1.4	%		1,204,009			35,555		3.0	%
	Less: Allowance for credit losses ("ACL")		(15,959	)		(15,948	)		(11	)	(0.1	%)		(15,291	)		(668	)	(4.4	%)
	Loans held-for-investment, net		1,223,605			1,206,917			16,688		1.4	%		1,188,718			34,887		2.9	%

	Other real estate owned ("OREO")		521			521			-		-			55			466		847.3	%
	Restricted stock investments		11,011			11,011			-		-			11,011			-		-
	Servicing assets		6,909			7,192			(283	)	(3.9	%)		7,673			(764	)	(10.0	%)
	Goodwill		2,185			2,185			-		-			2,185			-		-
	Intangible assets		214			224			(10	)	(4.5	%)		255			(41	)	(16.1	%)
	Other assets		33,384			25,284			8,100		32.0	%		24,838			8,546		34.4	%
	Total assets	$	1,815,635		$	1,770,549		$	45,086		2.5	%	$	1,760,413		$	55,222		3.1	%

LIABILITIES AND STOCKHOLDERS' EQUITY
	Noninterest-bearing	$	304,005		$	318,807		$	(14,802	)	(4.6	%)	$	305,923		$	(1,918	)	(0.6	%)
	Interest-bearing		1,176,567			1,128,784			47,783		4.2	%		1,147,662			28,905		2.5	%
	Total deposits		1,480,572			1,447,591			32,981		2.3	%		1,453,585			26,987		1.9	%

	FHLB advances and other borrowing		50,000			50,000			-		-			50,000			-		-
	Other liabilities		30,096			22,415			7,681		34.3	%		21,114			8,982		42.5	%
	Total liabilities		1,560,668			1,520,006			40,662		2.7	%		1,524,699			35,969		2.4	%

	Stockholders' Equity		254,967			250,543			4,424		1.8	%		235,714			19,253		8.2	%
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY		$	1,815,635		$	1,770,549		$	45,086		2.5	%	$	1,760,413		$	55,222		3.1	%

CAPITAL RATIOS
	Leverage ratio
	Company		14.12	%		14.64	%		(0.52	%)	(3.6	%)		12.98	%		1.14	%	8.8	%
	Bank		14.07	%		14.58	%		(0.51	%)	(3.5	%)		12.96	%		1.11	%	8.6	%
	Common equity tier 1 risk-based capital ratio
	Company		19.02	%		19.03	%		(0.01	%)	(0.0	%)		18.08	%		0.94	%	5.2	%
	Bank		18.95	%		18.95	%		-		-			18.05	%		0.90	%	5.0	%
	Tier 1 risk-based capital ratio
	Company		19.02	%		19.03	%		(0.01	%)	(0.0	%)		18.08	%		0.94	%	5.2	%
	Bank		18.95	%		18.95	%		-		-			18.05	%		0.90	%	5.0	%
	Total risk-based capital ratio
	Company		20.23	%		20.26	%		(0.03	%)	(0.2	%)		19.30	%		0.93	%	4.8	%
	Bank		20.16	%		20.18	%		(0.02	%)	(0.1	%)		19.27	%		0.89	%	4.6	%
	Tangible book value per share	$	23.85		$	23.44		$	0.41		1.8	%	$	22.03		$	1.82		8.3	%
	Loans Held for Investments-to-Deposit ("LHFITD") ratio		83.72	%		84.48	%		(0.76	%)	(0.9	%)		82.83	%		0.89	%	1.1	%
	Net Loan-to-Deposit ("LTD") ratio		96.05	%		97.05	%		(1.00	%)	(1.0	%)		96.79	%		(0.74	%)	(0.8	%)
	Nonperforming assets	$	12,051		$	8,558		$	3,493		40.8	%	$	2,484		$	9,567		385.1	%
	Nonperforming assets as a % of loans held-for-investment		0.97	%		0.70	%		0.27	%	38.6	%		0.21	%		0.76	%	361.9	%
	ACL as a % of loans held-for-investment		1.29	%		1.30	%		(0.01	%)	(0.77	%)		1.27	%		0.02	%	1.6	%

¹ Includes AFS and HTM

FIVE-QUARTER STATEMENT OF INCOME (Unaudited) - Table 3
(Dollars in thousands, except per share amounts)

	Three Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,
	2024			2024			2024			2024			2023

Interest income	$	28,769		$	28,380		$	27,755		$	28,463		$	29,624
Interest expense		13,121			12,904			12,391			12,655			12,462
Net interest income		15,648			15,476			15,364			15,808			17,162

Provision for credit losses		-			(100	)		200			400			-
Net interest income after provision for credit losses		15,648			15,576			15,164			15,408			17,162

Gain on sale of loans		1,013			991			1,064			1,489			838
Gain (loss) on sale of OREO		-			-			-			(1	)		-
SBA servicing fee income, net		654			760			768			633			690
Recovery on impaired servicing liability		-			-			-			10			-
Service charges and other income		543			465			503			430			436
Noninterest income		2,210			2,216			2,335			2,561			1,964

Salaries and employee benefits		5,635			5,884			5,927			6,024			5,356
Occupancy and equipment		1,280			1,149			1,114			1,122			1,128
Marketing expense		285			423			403			402			250
Professional expense		329			456			440			412			360
Other expenses		2,411			2,104			1,972			2,084			2,363
Noninterest expense		9,940			10,016			9,856			10,044			9,457

Income before income tax expense		7,918			7,776			7,643			7,925			9,669

Income tax expense		2,211			2,207			2,163			2,253			2,670

Net income	$	5,707		$	5,569		$	5,480		$	5,672		$	6,999

Effective tax rate		27.9	%		28.4	%		28.3	%		28.4	%		27.6	%

Outstanding number of shares		10,588,136			10,588,136			10,588,136			10,588,136			10,588,136

Weighted average shares for basic EPS		10,588,136			10,588,136			10,588,136			10,588,136			10,588,136
Weighted average shares for diluted EPS		10,598,476			10,596,039			10,588,136			10,588,688			10,588,937

Basic EPS	$	0.54		$	0.53		$	0.51		$	0.54		$	0.66
Diluted EPS	$	0.54		$	0.53		$	0.51		$	0.54		$	0.66

FIVE-QUARTER SALARIES BENEFIT METRICS (Unaudited) - Table 4
(Dollars in thousands)

	At or for the Three Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,
	2024			2024			2024			2023			2023

Salaries and benefits	$	5,635		$	5,884		$	5,927		$	6,024		$	5,356
FTE at the end of period		168			178			172			168			169
Average FTE during the period		166			173			171			169			169
Salaries and benefits/average FTE¹	$	135		$	135		$	139		$	143		$	126
Salaries and benefits/average assets¹		1.25	%		1.38	%		1.42	%		1.41	%		1.18	%
Noninterest expense/average assets¹		2.21	%		2.35	%		2.36	%		2.35	%		2.08	%

¹ Annualized

FIVE-QUARTER BALANCE SHEET (Unaudited) - Table 5
(Dollars in thousands)

		December 31,			September 30,			June 30,			March 31,			December 31,
		2024			2024			2024			2024			2023
ASSETS
	Cash and due from banks	$	10,336		$	14,892		$	11,667		$	11,612		$	14,282
	Interest-earning deposits at the FRB and other banks		266,826			241,094			101,415			181,366			233,255
	Investment securities		62,196			63,208			73,051			59,143			59,883
	Loans held-for-sale		198,448			198,021			209,144			198,167			218,258

	Loans held-for-investment		1,239,564			1,222,865			1,228,496			1,194,439			1,204,009
	Less: Allowance for credit losses		(15,959	)		(15,948	)		(16,042	)		(16,048	)		(15,291	)
	Loans held-for-investment, net		1,223,605			1,206,917			1,212,454			1,178,391			1,188,718

	Other real estate owned		521			521			-			-			55
	Restricted stock investments		11,011			11,011			11,011			11,011			11,011
	Servicing assets		6,909			7,192			7,404			7,560			7,673
	Goodwill		2,185			2,185			2,185			2,185			2,185
	Intangible assets		214			224			235			245			255
	Other assets		33,384			25,284			26,343			23,581			24,838
	Total assets	$	1,815,635		$	1,770,549		$	1,654,909		$	1,673,261		$	1,760,413

LIABILITIES AND STOCKHOLDERS' EQUITY
	Noninterest-bearing	$	304,005		$	318,807		$	281,243		$	286,766		$	305,923
	Interest-bearing		1,176,567			1,128,784			1,059,146			1,074,198			1,147,662
	Total deposits		1,480,572			1,447,591			1,340,389			1,360,964			1,453,585

	FHLB advances		50,000			50,000			50,000			50,000			50,000
	Other liabilities		30,096			22,415			19,260			21,727			21,114
	Total liabilities		1,560,668			1,520,006			1,409,649			1,432,691			1,524,699

	Stockholders' Equity		254,967			250,543			245,260			240,570			235,714
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY		$	1,815,635		$	1,770,549		$	1,654,909		$	1,673,261		$	1,760,413

FIVE-QUARTER LOANS RECEIVABLE COMPONENTS (Unaudited) - Table 6
(Dollars in thousands)

	December 31, 2024				September 30, 2024				June 30, 2024				March 31, 2024				December 31, 2023
	Balance		%		Balance		%		Balance		%		Balance		%		Balance		%

Construction	$	27,276	2.2	%	$	29,789	2.4	%	$	33,918	2.8	%	$	37,216	3.1	%	$	34,886	2.9	%
Commercial real estate		1,048,945	84.6	%		1,029,768	84.2	%		1,035,425	84.3	%		1,005,765	84.2	%		1,010,495	83.9	%
Commercial and industrial		114,435	9.2	%		112,588	9.2	%		108,742	8.9	%		101,784	8.5	%		108,123	9.0	%
Home mortgage		43,676	3.5	%		45,673	3.7	%		44,987	3.7	%		44,389	3.7	%		44,920	3.7	%
Consumer		552	0.0	%		537	0.0	%		782	0.1	%		668	0.1	%		630	0.1	%
Gross loans held-for-investment		1,234,884	99.6	%		1,218,355	99.6	%		1,223,854	99.6	%		1,189,822	99.6	%		1,199,054	99.6	%

Deferred loan fees/costs, net		4,680	0.4	%		4,510	0.4	%		4,642	0.4	%		4,617	0.4	%		4,955	0.4	%
Loans held-for-investment	$	1,239,564	100.0	%	$	1,222,865	100.0	%	$	1,228,496	100.0	%	$	1,194,439	100.0	%	$	1,204,009	100.0	%

Loans held-for-sale	$	198,448			$	198,021			$	209,144			$	198,167			$	218,258
Total loans receivable	$	1,438,012			$	1,420,886			$	1,437,640			$	1,392,606			$	1,422,267

FIVE-QUARTER SBA LOAN PRODUCTIONS/SALES DATA (Unaudited) - Table 7
(Dollars in thousands)

	Three Months Ended															Twelve Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
	2024			2024			2024			2024			2023			2024			2023

SBA loans held-for-sale at beginning of the quarter/year	$	198,021		$	209,144		$	198,167		$	218,258		$	219,355		$	218,258		$	230,431
SBA loans originated/transferred from/to held-for-investment during the quarter/year		27,557			13,169			34,366			14,589			27,022			89,681			78,445
SBA loans sold during the quarter/year		(17,215	)		(20,152	)		(19,508	)		(28,164	)		(21,749	)		(85,039	)		(73,431	)
SBA loans principal paydown/payoff, net of advance		(9,915	)		(4,140	)		(3,881	)		(6,516	)		(6,370	)		(24,452	)		(17,187	)
SBA loans held-for-sale at end of the quarter/year	$	198,448		$	198,021		$	209,144		$	198,167		$	218,258		$	198,448		$	218,258

Gain on sale of SBA loans	$	1,013		$	991		$	1,064		$	1,489		$	838		$	4,557		$	3,209
Premium on sale (weighted average)		9.2	%		7.5	%		8.3	%		6.8	%		6.7	%		8.3	%		7.0	%

SBA loan production	$	39,741		$	23,227		$	45,126		$	18,089		$	37,821		$	126,183		$	107,823



Net Premium Received		1,585			1,508			1,609			2,378			1,449			7,080			5,109
		63.9	%		65.7	%		66.1	%		62.6	%		57.8	%		64.4	%		62.8	%
SBA Loan Production
Oct-24		11,364,133			9,058,000			18,289,000			3,701,000			8,428,000			42,412,133			23,602,000
Nov-24		13,438,531			5,525,000			5,273,324			5,724,000			12,573,000			29,960,854			50,225,500
Dec-24		14,938,000			8,644,000			21,564,000			8,664,000			16,820,000			53,810,000			33,995,000
		39,740,664			23,227,000			45,126,324			18,089,000			37,821,000			126,182,987			107,822,500


Total Loan Production
Oct-24		33,655,902			19,440,000			56,216,000			15,651,000			36,328,000
Nov-24		52,773,531			27,102,209			26,623,324			12,559,000			22,588,000
Dec-24		29,003,000			15,034,000			43,214,670			17,689,000			26,390,000
		115,432,432			61,576,209			126,053,994			45,899,000			85,306,000


SBA Loan Paid-off
Oct-24		1,197,726			1,482,467			2,709,182			9,292,801			3,384,549
Nov-24		2,093,830			2,830,972			1,796,192			2,426,785			2,385,378
Dec-24		5,863,430			5,121,340			3,438,700			2,016,293			4,344,318
		9,154,987			9,434,780			7,944,073			13,735,879			10,114,246


SBA PPP Loan Production
Oct-24		-			-			-			-			-
Nov-24		-			-			-			-			-
Dec-24		-			-			-			-			-
		-			-			-			-			-
SBA PPP Loan Paid-off
Oct-24														73,290
Nov-24											34,671			-
Dec-24														-
		-			-			-			34,671			73,290

FIVE QUARTER SBA SERVICING ASSETS AND SERVICING FEES (Unaudited) - Table 8
(Dollars in thousands)

	Three Months Ended															Twelve Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
	2024			2024			2024			2023			2023			2024			2023


SBA servicing assets @ beginning of the quarter/year	$	7,192		$	7,404		$	7,560		$	7,673		$	7,873		$	7,673		$	9,232

Newly added SBA servicing assets from SBA loans sold		355			377			395			555			430			1,682			1,418
Regular quarterly/annual servicing assets amortization		(315	)		(332	)		(335	)		(332	)		(356	)		(1,314	)		(1,509	)
SBA servicing assets amortized from SBA loans paid off/charged off		(323	)		(257	)		(216	)		(336	)		(274	)		(1,132	)		(1,468	)

Subtotal before impairment		6,909			7,192			7,404			7,560			7,673			6,909			7,673

Reversal of valuation allowance on servicing assets		-			-			-			-			-			-			-

SBA servicing assets @ the end of the quarter/year	$	6,909		$	7,192		$	7,404		$	7,560		$	7,673		$	6,909		$	7,673

FIVE-QUARTER DEPOSIT COMPONENTS (Unaudited) - Table 9
(Dollars in thousands)

	December 31, 2024				September 30, 2024				June 30, 2024				March 31, 2024				December 31, 2023
	Balance		%		Balance		%		Balance		%		Balance		%		Balance		%

Noninterest-bearing demand	$	304,005	20.5	%	$	318,807	22.0	%	$	281,243	21.0	%	$	286,766	21.1	%	$	305,923	21.1	%
Interest-bearing demand		7,541	0.5	%		6,590	0.5	%		7,901	0.6	%		6,709	0.5	%		7,504	0.5	%
NOW & MMDA		269,475	18.2	%		246,157	17.0	%		240,951	18.0	%		229,642	16.9	%		237,548	16.3	%
Savings		84,727	5.7	%		78,356	5.4	%		80,360	6.0	%		84,999	6.2	%		88,689	6.1	%
TCDs of $250K and under		324,041	21.9	%		310,134	21.4	%		295,109	22.0	%		299,944	22.0	%		315,920	21.7	%
TCDs of $250K over		345,045	23.3	%		342,301	23.7	%		314,119	23.4	%		339,482	25.0	%		353,866	24.4	%
Wholesale deposits		145,738	9.9	%		145,246	10.0	%		120,706	9.0	%		113,422	8.3	%		144,135	9.9	%
Total Deposits	$	1,480,572	100.0	%	$	1,447,591	100.0	%	$	1,340,389	100.0	%	$	1,360,964	100.0	%	$	1,453,585	100.0	%

Recap:
Noninterest-bearing demand	$	304,005	20.5	%	$	318,807	22.0	%	$	281,243	21.0	%	$	286,766	21.1	%	$	305,923	21.0	%
Interest-bearing demand		7,541	0.5	%		6,590	0.5	%		7,901	0.6	%		6,709	0.5	%		7,504	0.5	%
NOW & MMDA		269,475	18.2	%		246,157	17.0	%		240,951	18.0	%		229,642	16.9	%		237,548	16.3	%
Savings		84,727	5.7	%		78,356	5.4	%		80,360	6.0	%		84,999	6.2	%		88,689	6.1	%
TCDs of $250K and under		324,041	21.9	%		310,134	21.4	%		295,109	22.0	%		299,944	22.0	%		315,920	21.7	%
Core Deposits		989,789	66.9	%		960,044	66.3	%		881,952	67.6	%		908,060	66.7	%		955,584	65.7	%

TCDs of $250K over		345,045	23.3	%		342,301	23.6	%		314,119	23.4	%		339,482	24.9	%		353,866	24.3	%
Nonreciprocal ICS MMDA		-	-			-	-			-	-			-	-			-	-
Wholesale deposits		145,738	9.8	%		145,246	10.0	%		120,706	9.0	%		113,422	8.3	%		144,135	9.9	%
Noncore Deposits		490,783	33.1	%		487,547	33.7	%		434,825	32.4	%		452,904	33.3	%		498,001	34.3	%
Total Deposits	$	1,480,572	100.0	%	$	1,447,591	100.0	%	$	1,340,389	100.0	%	$	1,360,964	100.0	%	$	1,453,585	100.0	%

FIVE-QUARTER SELECTED LOAN AND ASSET QUALITY HIGHLIGHTS (Unaudited) - Table 10
(Dollars in thousands)

		4th Qtr.			3rd Qtr.			2nd Qtr.			1st Qtr.			4th Qtr.
		2024			2024			2024			2024			2023
Allowance for Credit Losses
	Balance at beginning of period	$	15,948		$	16,042		$	16,048		$	15,291		$	15,284
	CECL transition provision		-			-			-			-			-
	Provision for credit losses		-			-			200			743			-
	Charge-offs		-			(108	)		(257	)		-			(2	)
	Recoveries		11			14			51			14			9
	Balance at the end of period	$	15,959		$	15,948		$	16,042		$	16,048		$	15,291

Nonperforming Assets:¹
	Over 90 days still accruing	$	1,819		$	994		$	-		$	1,605		$	399
	Nonaccrual loans		9,711			7,043			5,797			2,842			2,030
	Total nonperforming loans		11,530			8,037			5,797			4,447			2,429

	Other real estate owned	$	521			521			-			-			55
	Total nonperforming assets	$	12,051		$	8,558		$	5,797		$	4,447		$	2,484

Classified Assets:¹
	Substandard	$	22,077		$	15,980		$	12,762		$	11,912		$	11,063
	Doubtful		-			-			-			-			-
	Loss
	Total classified loans	$	22,077		$	15,980		$	12,762		$	11,912		$	11,063

	Other real estate owned	$	521			521			-			-			55
	Total classified assets	$	22,598		$	16,501		$	12,762		$	11,912		$	11,118

Performing modified loans:¹		$	649		$	452		$	464		$	3,811		$	3,336

Delinquent Loans:¹
	Loans 30-89 days past due	$	7,614		$	4,308		$	8,613		$	16,907		$	5,981
	90 days or more past due and still accruing		1,819			994			-			1,605			399
	Nonaccrual		9,711			7,043			5,797			2,842			2,030
	Total delinquent loans	$	19,144		$	12,345		$	14,410		$	21,354		$	8,410

Asset Quality Ratios:
	Net (recoveries) charge-offs to average loans²		0.00	%		0.03	%		0.06	%		0.00	%		0.00	%
	Nonaccrual loans to loans held-for-investment		0.78	%		0.58	%		0.47	%		0.24	%		0.17	%
	Nonperforming loans to loans held-for-investment		0.93	%		0.66	%		0.47	%		0.37	%		0.20	%
	Nonperforming assets to total assets		0.66	%		0.48	%		0.35	%		0.27	%		0.14	%
	Classified loans to loans held-for-investment		1.78	%		1.31	%		1.04	%		1.00	%		0.92	%
	Classified loans to Tier 1 and ACL		8.22	%		6.05	%		4.93	%		4.69	%		4.45	%
	Classified assets to total assets		1.24	%		0.93	%		0.77	%		0.71	%		0.63	%
	Classified assets to Tier 1 and ACL		8.42	%		6.25	%		4.93	%		4.69	%		4.47	%
	ACL to loans held-for-investment		1.29	%		1.30	%		1.31	%		1.34	%		1.27	%
	ACL to nonaccrual loans		164.34	%		226.44	%		276.73	%		564.67	%		753.25	%
	ACL to nonperforming loans		138.41	%		198.43	%		276.73	%		360.87	%		629.52	%
	ACL to nonperforming assets		132.43	%		186.35	%		276.73	%		360.87	%		615.58	%
	Texas ratio ³		4.49	%		3.24	%		2.24	%		1.75	%		1.00	%

¹ Net of SBA guaranteed balance
² Includes loans held-for-sale
³Nonperforming assets divided by tangible common equity and ACL

FIVE-QUARTER CAPITAL RATIOS (Unaudited) - Table 11

	Well Capitalized		Adequately Capitalized		December 31,			September 30,			June 30,			March 31,			December 31,
	Regulatory		BASEL III
	Requirement		Fully Phased In		2024			2024			2024			2024			2023

Leverage ratio
Company	N/A		N/A			14.12	%		14.64	%		14.51	%		13.85	%		12.98	%
Bank	5.00	%	4.00	%		14.07	%		14.58	%		14.45	%		13.84	%		12.96	%
Common equity tier 1 risk-based capital ratio
Company	N/A		N/A			19.02	%		19.03	%		18.36	%		18.67	%		18.08	%
Bank	6.50	%	7.00	%		18.95	%		18.95	%		18.28	%		18.65	%		18.05	%
Tier 1 risk-based capital ratio
Company	N/A		N/A			19.02	%		19.03	%		18.36	%		18.67	%		18.08	%
Bank	8.00	%	8.50	%		18.95	%		18.95	%		18.28	%		18.65	%		18.05	%
Total risk-based capital ratio
Company	N/A		N/A			20.23	%		20.26	%		19.59	%		19.92	%		19.30	%
Bank	10.00	%	10.50	%		20.16	%		20.18	%		19.50	%		19.91	%		19.27	%

Tangible common equity/total assets						13.93	%		14.03	%		14.70	%		14.25	%		13.27	%
Tangible common equity per share					$	23.85		$	23.44		$	22.94		$	22.49		$	22.03

FIVE-QUARTER MARGIN ANALYSIS (Unaudited) - Table 12
(Dollars in thousands)

	Three Months Ended
	December 31, 2024							September 30, 2024							June 30, 2024							March 31, 2024							December 31, 2023
	Avg Balance			Interest		Yield		Avg Balance			Interest		Yield		Avg Balance			Interest		Yield		Avg Balance			Interest		Yield		Avg Balance			Interest		Yield
Number of Days in the Period																						Checked
INTEREST-EARNING ASSETS
Loans Receivable¹	$	1,432,216		$	24,863	6.91	%	$	1,427,123		$	25,357	7.07	%	$	1,418,458		$	24,887	7.06	%	$	1,415,924		$	24,906	7.07	%	$	1,410,971		$	24,926	7.01	%
Investment securities ²		62,714			696	4.42	%		68,198			734	4.28	%		70,052			723	4.15	%		59,554			575	3.88	%		60,094			563	3.72	%
Interest-earning deposits at the FRB and other banks		253,524			3,048	4.78	%		158,127			2,139	5.38	%		146,956			1,995	5.46	%		207,155			2,817	5.47	%		288,769			3,973	5.46	%
Other earning assets		11,011			211	7.62	%		11,011			200	7.23	%		11,011			200	7.31	%		11,011			214	7.82	%		11,011			212	7.64	%
Total interest-earning assets ²		1,759,465			28,818	6.52	%		1,664,459			28,430	6.80	%		1,646,477			27,805	6.79	%		1,693,644			28,512	6.77	%		1,770,845			29,674	6.65	%

NONINTEREST-EARNING ASSETS
Cash and due from banks		12,349							12,527							12,907							12,172							12,567
Other noninterest-earning assets		35,479							34,395							33,263							31,967							32,985
Total noninterest-earning assets		47,828							46,922							46,170							44,139							45,552

Less: Allowance for credit losses		(15,953	)						(16,024	)						(16,058	)						(15,322	)						(15,291	)

TOTAL ASSETS	$	1,791,340						$	1,695,357						$	1,676,589						$	1,722,461						$	1,801,106

INTEREST-BEARING DEPOSITS
Interest-bearing demand	$	11,147		$	6	0.21	%	$	11,007		$	6	0.22	%	$	11,864		$	6	0.20	%	$	12,680		$	6	0.19	%	$	12,657		$	7	0.22	%
Money market		244,258			2,508	4.08	%		236,834			2,555	4.29	%		230,261			2,272	3.97	%		229,441			2,285	4.01	%		222,289			2,158	3.85	%
Savings		81,423			661	3.23	%		79,289			689	3.46	%		82,215			700	3.42	%		84,854			724	3.43	%		82,403			664	3.20	%
Time deposits		815,866			9,828	4.79	%		767,607			9,536	4.94	%		759,954			9,296	4.92	%		801,122			9,523	4.78	%		824,900			9,515	4.58	%
Total interest-bearing deposits		1,152,694			13,003	4.49	%		1,094,737			12,786	4.65	%		1,084,294			12,274	4.55	%		1,128,097			12,538	4.47	%		1,142,249			12,344	4.29	%

Borrowings		50,001			118	0.94	%		50,000			118	0.94	%		50,013			117	0.94	%		50,000			117	0.94	%		50,001			118	0.94	%
Total interest-bearing liabilities		1,202,695			13,121	4.34	%		1,144,737			12,904	4.48	%		1,134,307			12,391	4.39	%		1,178,097			12,655	4.32	%		1,192,250			12,462	4.15	%

Noninterest-bearing deposits		309,662							280,670							279,765							284,867							350,656
Other liabilities		26,090							21,376							19,287							21,112							25,602

Stockholders' equity		252,893							248,574							243,230							238,385							232,598
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY	$	1,791,340						$	1,695,357						$	1,676,589						$	1,722,461						$	1,801,106

Net interest income²				$	15,697						$	15,526						$	15,414						$	15,857						$	17,212

Net interest spread						2.18	%						2.32	%						2.40	%						2.45	%						2.50	%

Effect of noninterest-bearing sources						1.37	%						1.39	%						1.37	%						1.32	%						1.36	%

Net interest margin²						3.55	%						3.71	%						3.77	%						3.77	%						3.86	%


Cost of deposits	$	1,462,356		$	13,003	3.54	%	$	1,375,407		$	12,786	3.70	%	$	1,364,059		$	12,274	3.62	%	$	1,412,964		$	12,538	3.57	%	$	1,492,905		$	12,344	3.28	%

Cost of funds	$	1,512,357		$	13,121	3.45	%	$	1,425,407		$	12,904	3.60	%	$	1,414,072		$	12,391	3.52	%	$	1,462,964		$	12,655	3.48	%	$	1,542,906		$	12,462	3.20	%

¹ Loan held-for-investment, plus loans held-for-sale
² Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate

FIVE-QUARTER COMPONENTS OF YIELD ON LOANS (Unaudited) - Table 13
(Dollars in thousands)

	Three Months Ended
	December 31, 2024					September 30, 2024					June 30,2024					March 31, 2024					December 31, 2023
	Amount			Yield		Amount			Yield		Amount			Yield		Amount			Yield		Amount			Yield

Contractual yield	$	24,036		6.68	%	$	24,544		6.84	%	$	24,271		6.88	%	$	24,138		6.86	%	$	24,235		6.81	%
SBA discount accretion		818		0.23	%		806		0.23	%		736		0.21	%		926		0.26	%		845		0.24	%
Prepayment penalties and late fees		64		0.02	%		184		0.05	%		36		0.01	%		67		0.01	%		40		0.01	%
Amortization of net deferred costs		(55	)	-0.02	%		(177	)	-0.05	%		(156	)	-0.04	%		(225	)	-0.06	%		(194	)	-0.05	%
As reported yield on loans	$	24,863		6.91	%	$	25,357		7.07	%	$	24,887		7.06	%	$	24,906		7.07	%	$	24,926		7.01	%

MARGIN ANALYSIS (Unaudited) - Table 14
(Dollars in thousands)

	Twelve Months Ended
	December 31, 2024							December 31, 2023
	Avg Balance			Interest		Yield		Avg Balance			Interest		Yield
Number of Days in the Period
INTEREST-EARNING ASSETS
Loans Receivable ¹	$	1,423,464		$	100,013	7.03	%	$	1,443,379		$	98,700	6.84	%
Investment securities ²		65,131			2,728	4.19	%		65,666			2,312	3.52	%
Interest-earning deposits at the FRB and other banks		191,519			9,999	5.22	%		258,060			13,441	5.21	%
Other earning assets		11,011			825	7.49	%		10,745			735	6.84	%
Total interest-earning assets ²		1,691,125			113,565	6.72	%		1,777,850			115,188	6.48	%

NONINTEREST-EARNING ASSETS
Cash and due from banks		12,489							13,161
Other noninterest-earning assets		33,538							34,218
Total noninterest-earning assets		46,027							47,379

Less: Allowance for credit losses		(15,840	)						(15,522	)

TOTAL ASSETS	$	1,721,312						$	1,809,707

INTEREST-BEARING DEPOSITS
Interest-bearing demand	$	11,671		$	24	0.21	%	$	14,367		$	29	0.20	%
Money market		235,228			9,620	4.09	%		214,509			6,948	3.24	%
Savings		81,936			2,774	3.39	%		68,166			1,646	2.41	%
Time deposits		786,168			38,183	4.86	%		820,452			32,909	4.01	%
Total interest-bearing deposits		1,115,003			50,601	4.54	%		1,117,494			41,532	3.72	%

Borrowings		50,004			470	0.94	%		50,001			470	0.94	%
Total interest-bearing liabilities		1,165,007			51,071	4.38	%		1,167,495			42,002	3.60	%

Noninterest-bearing deposits		288,776							396,067
Other liabilities		21,731							22,763

Stockholders' equity		245,798							223,382

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY	$	1,721,312						$	1,809,707

Net interest income²				$	62,494						$	73,186

Net interest spread						2.34	%						2.88	%

Effect of noninterest-bearing sources						1.36	%						1.24	%

Net interest margin²						3.70	%						4.12	%


Cost of deposits	$	1,403,779		$	50,601	3.60	%	$	1,513,561		$	41,532	2.74	%

Cost of funds	$	1,453,783		$	51,071	3.51	%	$	1,563,562		$	42,002	2.69	%

1 Loan held-for-investment, plus loans held-for-sale
² Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate

COMPONENTS OF YIELD ON LOANS (Unaudited) - Table 15
(Dollars in thousands)

	Twelve Months Ended
	December 31, 2024					December 31, 2023
	Amount			Yield		Amount			Yield

Contractual yield	$	96,989		6.81	%	$	95,577		6.62	%
SBA discount accretion		3,286		0.24	%		3,827		0.27	%
Prepayment penalties and late fees		351		0.02	%		148		0.01	%
Amortization of net deferred costs		(613	)	-0.04	%		(852	)	-0.06	%
As reported yield on loans	$	100,013		7.03	%	$	98,700		6.84	%