United Security Bancshares(US:UBFO)2024-11-06 22:07Financial Performance - Net income for the quarter decreased 0.62% to $3.8 million for the quarter ended September 30, 2024, compared to $3.9 million for the same quarter in 2023[147]. - The Company's annualized return on average assets was 1.36% for the nine months ended September 30, 2024, compared to 1.52% for the same period in 2023[151]. - The Company's annualized return on average equity was 12.95% for the nine months ended September 30, 2024, compared to 16.64% for the same period in 2023[151]. - Noninterest income for the quarter ended September 30, 2024, increased by $1.9 million to $2.0 million compared to the same quarter in 2023[165]. - Total noninterest income for the nine months ended September 30, 2024, increased by $2.0 million to $4.6 million compared to the same period in 2023[167]. Interest Income and Expenses - Net interest margin increased to 4.20% for the quarter ended September 30, 2024, compared to 4.09% for the same quarter in 2023[147]. - Interest expense increased 15.7% to $3.9 million, compared to $3.4 million for the third quarter of 2023[147]. - For the three months ended September 30, 2024, total interest income increased by $427,000, or 2.8%, compared to the same period in 2023[157]. - For the nine months ended September 30, 2024, total interest income increased by $634,000, or 1.41%, compared to the same period in 2023[159]. - Total interest expense increased by approximately $3.0 million, or 38.9%, for the nine months ended September 30, 2024, compared to the same period in 2023[162]. Loans and Deposits - Total loans, net of unearned fees, increased 5.99% to $975.2 million, compared to $920.0 million at December 31, 2023[147]. - Total deposits increased 6.0% to $1.07 billion, compared to $1.00 billion at December 31, 2023[147]. - Net loans increased to $958.6 million as of September 30, 2024, from $904.4 million at December 31, 2023, reflecting organic loan growth[176]. - Total gross loans amounted to $975.2 million as of September 30, 2024, an increase of $55.1 million or 6.0% from $920.0 million at December 31, 2023[178]. - Total deposits reached $1.07 billion at September 30, 2024, an increase of $60.5 million (6.0%) from December 31, 2023, but a decrease of $77.4 million (7.8%) year-over-year[191]. Credit Losses and Allowances - The allowance for credit losses as a percentage of gross loans decreased to 1.69%, compared to 1.70% at December 31, 2023[147]. - The Company recorded a provision for credit losses of $1.6 million for the quarter ended September 30, 2024, with no provision recorded for the same quarter in 2023[147]. - The allowance for credit losses was $15,296, slightly improved from $15,817 in the previous year[153]. - The provision for credit losses was $2.14 million for the nine months ended September 30, 2024, significantly higher than the $452,000 provision for the same period in 2023[214]. - Nonperforming assets rose to $17.43 million as of September 30, 2024, up from $16.46 million at December 31, 2023, representing an increase of $974,000[205]. Capital and Equity - Total shareholders' equity increased from $117,401 to $130,929, representing an increase of approximately 11%[153]. - The Company's effective tax rate for the three months ended September 30, 2024, was 25.43%, down from 28.78% for the same period in 2023[174]. - The Bank's Tier 1 Capital Ratio was 12.35% at September 30, 2024, up from 11.42% at the same date in 2023[229]. - The Company declared a cash dividend of $0.12 per share on September 24, 2024, with approximately $2.1 million transferred from retained earnings for this distribution[233]. Asset Management - Total assets as of September 30, 2024, were $1.26 billion, an increase of $44.3 million year-to-date, while total liabilities were $1.12 billion, an increase of $34.0 million[176]. - Average interest-earning assets for the three months ended September 30, 2024, were $1,120,080, generating interest income of $15,755, with a yield of 5.60%[153]. - Total average assets decreased from $1,266,644 to $1,231,282, reflecting a decline of approximately 2.77% year-over-year[153]. - Cash and cash equivalents increased to $47.9 million at September 30, 2024, from $40.8 million at December 31, 2023[223]. Loan Portfolio Composition - Real estate mortgage loans represented 70.5% of total loans at September 30, 2024, totaling $687.9 million, an increase from $646.7 million at December 31, 2023[179]. - Agricultural loans rose by $16.8 million (25.5%) from December 31, 2023, to September 30, 2024, and by $5.0 million (7.5%) year-over-year[184]. - Installment loans decreased by $1.9 million (5.0%) from December 31, 2023, to September 30, 2024, and by $3.2 million (8.0%) year-over-year, primarily due to declines in student loan balances[184]. - The outstanding balance of student loans decreased by $3.5 million (8.8%) year-over-year, with $1.0 million in loans for students not yet in repayment status as of September 30, 2024[185]. Economic Conditions and Monitoring - The company continues to monitor economic conditions in the real estate market to assess the adequacy of the allowance for credit losses[211]. - The prime rate decreased from 8.50% at September 30, 2023, to 8.00% at September 30, 2024, impacting future interest income and expense[155].