Bay p(US:BCML)2025-11-07 22:03Financial Performance - Net income for the three months ended September 30, 2025, was $5.0 million, a decrease of 13.6% compared to $6.0 million for the same period in 2024 [190]. - Interest income for the three months ended September 30, 2025, increased by 4.6% to $35.0 million, driven by higher yields on interest-earning assets [193]. - Noninterest income decreased by $497,000, or 18.1%, to $2.2 million for the third quarter of 2025, mainly due to a $649,000 decrease in gain on equity securities [231]. - Noninterest income for the nine months ended September 30, 2025, decreased by $1.1 million, or 17.3%, to $5.2 million compared to the same period in 2024 [232]. - The efficiency ratio improved to 62.15% for the three months ended September 30, 2025, compared to 62.76% for the same period in 2024 [192]. Loan Portfolio - The total loan portfolio amounted to $2.0 billion, with $245.1 million, or 12.0%, of loans acquired through business combinations [133]. - Loans receivable increased by $89.4 million, or 4.6%, to $2.0 billion at September 30, 2025, from $1.9 billion at December 31, 2024 [152]. - Total loans included $245.1 million, or 12.0%, of loans acquired through business combinations as of September 30, 2025 [157]. - Total loans increased to $2,034,570 thousand in Q3 2025, up from $1,886,231 thousand in Q3 2024, representing a growth of 7.85% [224]. - New loan originations amounted to $337.2 million, contributing to the overall increase in loans [152]. Asset Management - Total assets decreased by $60.7 million, or 2.3%, to $2.6 billion at September 30, 2025, primarily due to a $135.6 million, or 37.2%, decline in cash and cash equivalents [146]. - Cash and cash equivalents decreased by $135.6 million, or 37.2%, to $228.4 million at September 30, 2025, primarily due to funding loan growth and deposit withdrawals [148]. - Investment securities available-for-sale decreased by $5.6 million, or 2.9%, to $187.8 million at September 30, 2025, attributed to routine maturities and principal repayments [149]. - Total average assets reached $2,657,740 thousand in Q3 2025, compared to $2,572,650 thousand in Q3 2024, indicating an increase of 3.31% [224]. Deposits and Funding - Total deposits reached $2.2 billion, indicating a stable funding base for commercial loan growth [132]. - Total deposits decreased by $5.9 million, or 0.3%, to $2.2 billion at September 30, 2025, compared to December 31, 2024 [178]. - Noninterest-bearing demand deposits fell to $618.1 million, or 27.7% of total deposits, from $689.0 million, or 30.8% at December 31, 2024 [178]. - Total deposits decreased by 0.3% to $2,228,052,000 as of September 30, 2025, primarily due to a 10.3% decline in demand deposits [182]. Credit Quality - The provision for credit losses was established based on estimated credit losses in the loan and investment securities portfolios [138]. - Nonperforming assets increased by $4.4 million to $13.9 million, or 0.68% of total loans, at September 30, 2025, compared to $9.5 million, or 0.48% of total loans, at December 31, 2024 [160]. - The allowance for credit losses increased by 16.2% to $20.8 million at September 30, 2025, from $17.9 million at December 31, 2024 [154]. - Nonperforming loans totaled $13.9 million, or 0.68% of total loans, at September 30, 2025, up from $9.5 million, or 0.48% at December 31, 2024 [161]. - The increase in the allowance for credit losses was primarily due to growth in the loan portfolio and an increase in the reserve for pooled loans [171]. Interest Income and Expense - Interest income on loans rose by 11.4% to $29.2 million for the three months ended September 30, 2025, due to a $148.3 million increase in the average balance of loans [196]. - Interest expense increased by 9.3% to $11.5 million for the three months ended September 30, 2025, primarily due to higher interest expense on subordinated debt [206]. - Interest income for the nine months ended September 30, 2025, was $101.0 million, an increase of 3.6% compared to $97.6 million for the same period in 2024 [200]. - The average annualized yield on interest-earning assets was 5.49% for Q3 2025, a four basis point increase from 5.45% in Q3 2024 [218]. - The annualized net interest margin improved to 3.76% for the nine months ended September 30, 2025, compared to 3.72% for the same period in 2024 [221]. Capital and Dividends - Shareholders' equity increased by $9.9 million to $334.3 million at September 30, 2025, primarily due to $17.1 million of net income earned during the first nine months of 2025 [189]. - The Company declared a quarterly cash dividend of $0.25 per share, with an expected average total dividend of approximately $2.7 million each quarter based on outstanding shares [248]. - As of September 30, 2025, the Bank was considered "Well Capitalized" under Federal Reserve regulations, maintaining adequate capital ratios [251]. - The Common Equity Tier 1 Ratio for BayCom Corp was 14.25% as of September 30, 2025, exceeding the minimum requirement for "Well Capitalized" status [253]. - The Bank's total risk-based capital ratio was 15.71% as of September 30, 2025, above the minimum requirement of 10.00% for "Well Capitalized" status [253].