United Security Bancshares(UBFO) - 2024 Q3 - Quarterly Results

Net Income and Profitability - Net income for the quarter ended September 30, 2024, decreased 0.6% to $3.8 million compared to $3.9 million for the same period in 2023[1][4] - Net income for the nine months ended September 30, 2024, decreased 14.6% to $12.3 million compared to $14.4 million for the same period in 2023[10] - Net income for September 2024 was $3,829 thousand, down from $4,297 thousand in June 2024[33] - Net income for the nine months ended September 30, 2024, is $12.287 million, a decrease of 14.6% compared to $14.395 million in 2023[38] - Non-GAAP core net income for the nine months ended September 30, 2024, is $12.188 million, down 17.6% from $14.788 million in 2023[38] Net Interest Margin and Interest Income - Net interest margin increased to 4.20% for the quarter ended September 30, 2024, compared to 4.09% for the same period in 2023[2][6] - Net interest margin decreased slightly to 4.20% in September 2024 from 4.28% in June 2024[30] - Net interest income before provision for credit losses decreased by $2.3 million (0.91%) to $35.0 million for the nine months ended September 30, 2024, compared to $37.4 million in the same period in 2023[12] - Net interest income for the nine months ended September 30, 2024, was $35,046 thousand, down from $37,368 thousand in the same period of 2023, a decrease of 6.21%[28] - Total interest income rose to $15,755 thousand in September 2024, up from $14,972 thousand in June 2024[33] - Interest income from loans and fees for the nine months ended September 30, 2024, was $41,457 thousand, up from $40,292 thousand in the same period of 2023, an increase of 2.89%[28] Loans and Deposits - Total loans increased 5.99% to $975.2 million as of September 30, 2024, compared to $920.0 million at December 31, 2023[2] - Total deposits increased 6.0% to $1.07 billion as of September 30, 2024, compared to $1.00 billion at December 31, 2023[2] - Total loans increased to $975,151 thousand in September 2024, up from $949,413 thousand in June 2024[32] - Total deposits increased to $1,065,021 thousand in September 2024, up from $1,006,614 thousand in June 2024[32] - Net loans grew to $958,628 thousand in September 2024, up from $904,384 thousand in December 2023, an increase of 6%[27] - Total deposits rose to $1,065,021 thousand in September 2024, compared to $1,004,477 thousand in December 2023, marking a 6.03% increase[27] - Loan-to-deposit ratio as of September 30, 2024, is 91.56%, slightly down from 91.59% as of December 31, 2023[36] Noninterest Income and Expense - Noninterest income increased to $2.0 million for the quarter ended September 30, 2024, primarily due to a $661,000 gain on the fair value of junior subordinated debentures[7] - Noninterest income increased by $2.0 million to $4.6 million for the nine months ended September 30, 2024, driven by gains from life insurance proceeds and changes in the fair value of TRUPs[13] - Noninterest income for the nine months ended September 30, 2024, was $4,591 thousand, compared to $2,574 thousand in the same period of 2023, a significant increase of 78.36%[28] - Noninterest expense increased by $1.8 million to $20.8 million for the nine months ended September 30, 2024, primarily due to higher professional fees and salaries[14] - Total noninterest expense for the nine months ended September 30, 2024, was $20,849 thousand, up from $19,082 thousand in the same period of 2023, an increase of 9.26%[28] Asset and Liability Growth - Total assets increased by $44.3 million (3.7%) to $1.2 billion as of September 30, 2024, driven by growth in gross loan balances and cash equivalents[16] - Total deposits increased by $60.5 million (6.0%) to $1.1 billion as of September 30, 2024, with interest-bearing deposits rising by $103.7 million[17] - Total assets increased to $1,255,376 thousand as of September 30, 2024, compared to $1,211,045 thousand at the end of 2023, reflecting a growth of 3.66%[27] - Total interest-earning assets increased to $1,120,080 thousand in September 2024, up from $1,082,749 thousand in June 2024[30] Credit Quality and Provisions - The provision for credit losses increased to $1.8 million for the nine months ended September 30, 2024, compared to $587,000 in the same period in 2023, primarily due to student loan charge-offs[20] - Non-performing assets increased by $974,000 to $17.4 million as of September 30, 2024, representing 1.39% of total assets[21] - The company's provision for credit losses for the nine months ended September 30, 2024, was $1,750 thousand, compared to $587 thousand in the same period of 2023, a substantial increase of 198.13%[28] - Nonperforming loans to total gross loans ratio increased to 1.32% in September 2024 from 1.29% in December 2023[35] - Total nonperforming assets increased to $17,430 thousand in September 2024 from $16,456 thousand in December 2023[35] - Provision for credit losses increased significantly to $1,558 thousand in September 2024 from $19 thousand in June 2024[33] - Allowance for credit losses to nonperforming loans decreased to 128.60% in September 2024 from 131.87% in December 2023[35] Capital and Shareholder Equity - The company's Tier 1 Leverage Ratio improved to 12.44% as of September 30, 2024, compared to 11.82% as of December 31, 2023[2] - Shareholders' equity increased by $10.3 million to $132.9 million as of September 30, 2024, driven by net income and a decrease in accumulated other comprehensive loss[18] - Tier 1 capital to adjusted average assets (leverage ratio) for the company as of September 30, 2024, is 12.44%, up from 11.82% as of December 31, 2023[36] - Book value per share as of September 30, 2024, is $7.67, compared to $7.14 as of December 31, 2023[36] - Tangible book value per share as of September 30, 2024, is $7.41, up from $6.88 as of December 31, 2023[36] Efficiency and Return Metrics - The efficiency ratio improved to 52.47% for the quarter ended September 30, 2024, compared to 54.63% for the same period in 2023[8] - Efficiency ratio for the three months ended 2024 is 52.47%, improving from 54.63% in 2023[36] - Annualized return on average assets (ROAA) increased to 1.24% for the quarter ended September 30, 2024, compared to 1.21% for the same period in 2023[4] - Return on average assets for the three months ended 2024 is 1.24%, compared to 1.21% for the same period in 2023[36] - Return on average equity for the three months ended 2024 is 11.63%, down from 13.06% in 2023[36] - Annualized net charge-offs to average loans for the three months ended 2024 is 0.27%, up from 0.20% in 2023[36] Dividends and Capital Adequacy - The company declared a cash dividend of $0.12 per share, payable on October 23, 2024[19] - The company remains well-capitalized and expects to maintain adequate capital levels[19] Cost of Deposits - Annualized average cost of deposits increased to 1.18% for the quarter ended September 30, 2024, compared to 0.71% for the same period in 2023[2][5]