RBB(RBB) - 2025 Q1 - Quarterly Results

Financial Performance - The Company reported net income of $2.3 million, or $0.13 diluted earnings per share, for Q1 2025, a decline from $4.4 million, or $0.25 per share, in Q4 2024[4] - Noninterest income for Q1 2025 was $2.3 million, a decrease of $434,000 from Q4 2024, primarily due to lower net gain on sale of loans[11] - Noninterest expense increased to $18.5 million, up $873,000 from Q4 2024, mainly due to higher salaries and employee benefits[12] - The effective tax rate for Q1 2025 was 28.2%, up from 13.3% in Q4 2024, attributed to lower tax credits and higher estimated pre-tax net income[13] - Basic net income per share was $0.13 for the quarter, down from $0.25 in the previous quarter, a decline of 48%[36] - The return on average assets for Q1 2025 was 0.24%, down from 0.44% in Q4 2024 and 0.81% in Q1 2024[41] - Return on average tangible common equity (ROATCE) for the three months ended March 31, 2025, was 2.12%, down from 3.98% for the same period in 2024[54] Loan and Deposit Growth - Net loans held for investment grew by $89.8 million, or 12% annualized, compared to Q4 2024, with a total of $3.1 billion as of March 31, 2025[15] - Total deposits increased by $58.8 million, or 7.7% annualized, to $3.1 billion as of March 31, 2025, with interest-bearing deposits rising by $93.6 million[17] - Total loans as of March 31, 2025, increased to $3,143,063 thousand, up from $3,053,230 thousand as of December 31, 2024, representing a growth of 2.9%[49] - Total deposits reached $3,142,628 thousand as of March 31, 2025, an increase from $3,083,789 thousand as of December 31, 2024, reflecting a growth of 1.9%[51] Asset Quality - Nonperforming assets decreased by $16.5 million, or 20.3%, to $64.6 million, representing 1.61% of total assets at March 31, 2025[18] - The provision for credit losses was $6.7 million for Q1 2025, compared to $6.0 million in Q4 2024, driven by an increase in specific reserves[10] - The allowance for credit losses increased to $52.6 million, with the allowance for loan losses as a percentage of loans held for investment rising to 1.65%[22] - Nonperforming loans held for investment (HFI) were $60,380 thousand, with a ratio of 1.92% to total loans HFI[45] - The allowance for loan losses was $51,932 thousand, equating to 1.65% of total loans HFI[45] Capital and Equity - As of March 31, 2025, total shareholders' equity was $510.3 million, reflecting a $2.4 million increase from December 31, 2024, but a $3.7 million decrease from March 31, 2024[24] - The increase in shareholders' equity for Q1 2025 was attributed to lower net unrealized losses on available for sale securities of $3.0 million and net income of $2.3 million, offset by cash dividends paid of $2.9 million[24] - For the last twelve months, shareholders' equity decreased due to common stock repurchases of $19.2 million and dividends paid of $11.6 million, despite net income of $20.9 million[24] - Book value per share increased to $28.77 at March 31, 2025, up from $28.66 at December 31, 2024, and $27.67 at March 31, 2024[24] - Tangible common equity as of March 31, 2025, was $436,969 thousand, slightly up from $434,368 thousand as of December 31, 2024[53] - The common equity to assets ratio remained stable at 12.73% as of March 31, 2025, compared to 12.72% as of December 31, 2024[53] Interest and Margin - The net interest margin expanded to 2.88%, up from 2.76% in Q4 2024, due to a decrease in the overall cost of funds[8] - Net interest income before provision for credit losses was $26,163 thousand for the three months ended March 31, 2025, up from $25,977 thousand in the previous quarter, an increase of 0.72%[36] - The cost of average total deposits for Q1 2025 was 3.13%, down from 3.35% in Q4 2024[41] - Interest on loans was $45,621 thousand for the quarter, slightly down from $46,374 thousand in the previous quarter, a decrease of 1.62%[36] Operational Overview - RBB Bancorp operates primarily in Asian-centric communities across multiple states, including California, Nevada, New York, New Jersey, and Illinois[27] - The company provides a range of banking services, including commercial and industrial loans, SBA loans, and wealth management services[27] - Management will hold a conference call on April 29, 2025, to discuss Q1 2025 financial results[28] - The company utilizes non-GAAP financial measures to enhance understanding of its operational performance[31] - Forward-looking statements are subject to various risks and uncertainties that could materially affect actual results[32]