Friendly Hills Bank Reports First Quarter Results

WHITTIER, Calif., May 04, 2016 (GLOBE NEWSWIRE) -- Friendly Hills Bank (the “bank”) (OTCBB:FHLB) reported results for the first quarter of 2016.

For the three month period ending March 31, 2016, the bank reported net income of $80,000 or $0.04 per diluted share of common stock. The bank reported net income of $65,000 or $0.03 per diluted share of common stock for the three months ended March 31, 2015. This figure includes a $13,000 increase in the value of the interest rate caps and a $31,000 net gain on securities sold.

As of March 31, 2016, the bank reported total assets of $127.0 million, an 8% increase from $117.0 million as of March 31, 2015. The bank’s loan portfolio, net of unearned income, increased 7% from $64.9 million as of March 31, 2015, to $69.4 million as of March 31, 2015. The portfolio remains diversified with $33.1 million or 48% in Commercial & Industrial Loans to local businesses (including $19.6 million in Owner Occupied Commercial Real Estate Loans), $17.5 million or 25% in Residential Real Estate Loans to investors and $12.7 million or 18% in Commercial Real Estate Loans to investors. The bank has an additional $23.7 million in unfunded loan commitments.

The bank’s overall deposit base has increased 12% in the twelve months ended March 31, 2016, from $89.5 million as of March 31, 2015, to $100.0 million as of March 31, 2016. Non-interest bearing deposits continue to form a substantial part of the deposit base (46%), growing from $38.7 million to $46.0 million as of March 31, 2016. During the same time period interest-bearing deposits increased from $50.8 million to $54.0 million on March 31, 2016. The bank has no deposits which were sourced through brokers or other wholesale funding sources.

At March 31, 2016, shareholders’ equity was $15.5 million and the bank’s total risk-based capital ratio was 17%, significantly exceeding the “well-capitalized” level of 10% prescribed under regulatory requirements. The bank also continues to maintain substantial liquidity positions, retaining significant balances of liquidity as well as available collateralized borrowings and other potential sources of liquidity.

“The bank continues to selectively grow its loan portfolio in the midst of a highly competitive market,” commented Jeffrey K. Ball, Chief Executive Officer. “While market conditions suggest lower underwriting standards by many lenders we remain committed to the standards which have preserved the strong capital position of the bank. This is consistent with our strategic focus on long term shareholder value and reflects our continued concern about the instability of the overall economy. Asset quality remains strong and the bank is well positioned for future growth opportunities including the development of our payroll services product which provides for more diversification of revenue sources during this sustained period of low interest rates.”

Company Profile:
Friendly Hills Bank is a community bank which was formed to primarily serve the Southern California communities of eastern Los Angeles County and northern Orange County. The bank was established in 2006 by prominent members of the local community who were seeking an alternative to the larger financial institutions in the area. The bank is headquartered in Whittier, California with an additional branch office in Santa Fe Springs, California. For more information on the bank, please visit or call 562-947-1920.

Forward Looking Statements:
The numbers in this press release are unaudited. Statements such as those regarding the anticipated development and expansion of Friendly Hills Bank's business, and the intent, belief or current expectations of the bank, its directors or its officers, are "forward looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward looking statements. These risks and uncertainties include, but are not limited to, risks related to the local and national economy, the bank's performance, including its ability to generate loan and deposit growth, changes in interest rates, and regulatory matters.

Friendly Hills Bank
Balance Sheets (Unaudited)
(in thousands, except per share information)



Cash and due from banks$ 3,645 $ 3,904 $ 3,598
Interest bearing deposits with other financial institutions 5,802 4,529 4,966
Cash and Cash Equivalents 9,447 8,433 8,564
Investment securities available-for-sale 42,226 43,312 37,961
Federal Home Loan Bank stock 753 753 677
Federal Reserve Bank stock 457 455 393
Loans, net of unearned income 69,393 67,876 64,919
Allowance for loan losses (1,595) (1,595) (1,595)
Net Loans 67,798 66,281 63,324
Premises and equipment, net 205 211 322
Accrued interest receivable and other assets 6,068 6,134 5,775
Total Assets$126,954 $125,579 $117,016
Noninterest-bearing deposits$46,022 $ 42,531 $ 38,731
Interest-bearing deposits 53,970 54,354 50,814
Total Deposits 99,992 96,885 89,545
FHLB advances 11,000 13,000 11,750
Accrued interest payable and other liabilities 474 452 397
Total Liabilities 111,466 110,337 101,692
Shareholders’ Equity
Common stock, no par value, 10,000,000 shares authorized:
1,939,193 shares issued and outstanding 15,958 15,958 15,958
Additional paid-in-capital 1,091 1,091 1,091
Accumulated deficit (1,571) (1,651) (1,980)
Accumulated other comprehensive income (loss) 10 (156) 255
Total Shareholders’ Equity 15,488 15,242 15,324
Total Liabilities and Shareholders’ Equity$126,954 $125,579 $117,016
Book Value Per Share$ 7.99 $ 7.86 $ 7.90

Friendly Hills Bank
Statements of Operations (Unaudited)
(in thousands, except per share information)
For the three For the three
months ended months ended
3/31/16 3/31/15
Interest Income$ 1,091 $ 1,041
Interest Expense 74 82
Net Interest Income 1,017 959
Provision for Loan Losses 0 0
Net Interest Income after Provision for Loan Losses 1,017 959
Noninterest Income 119 66
Noninterest Expense 1,012 973
Non-Recurring Items 0 44
Income before Provision for Income Taxes 124 96
(Provision) Benefit for Income Taxes (44) (31)
Net Income$ 80 $ 65
Basic and Diluted Earnings Per Share$ 0.04 $ 0.03

Contacts: Jeffrey K. Ball (President & CEO) Daniel L. Erickson (EVP & CFO) (562) 947-1920

Source:Friendly Hills Bank