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Metro Phoenix Bank Reports Earnings of $1,951,000, or $0.52 per Diluted Share in 4Q 2021; Loan Growth (Net PPP) Increased to 5.20% for the Quarter; Asset Quality Remains Strong as Non-Performing Asset Ratio Is 0.00%

PHOENIX, Jan. 26, 2022 /PRNewswire/ -- MPB BHC, INC. (OTCPink:MPHX), the holding company for Metro Phoenix Bank ("Bank"), announced net income for quarter ending December 31, 2021, of $1,951,000, or $0.52 per diluted share, up from $1,927,000, or $0.51 per diluted share in third quarter 2021. Net income increased 52.06% from $1,283,000 in the fourth quarter of 2020. Metro Phoenix Bank's fourth quarter earnings reflect the positive impact of a fully funded allowance for loan & lease losses (ALLL) and strong SBA lending activity.

Stephen P. Haggard, Bank President and Chief Executive Officer stated, "Metro Phoenix Bank's lending teams once again closed out the year with substantial momentum across all verticals of commercial lending. A combination of the very strong economic conditions in the Arizona market and a seasoned & efficient group of lending professionals has propelled the Metro Phoenix Bank "brand" into recurring banking solution conversations amongst small- to mid-sized businesses and commercial real estate banking professionals. This has been a record year in gross loan production, and I am very proud of the entire Metro Phoenix Bank lending team. 

"However, our record of consistently delivering meaningful loan solutions in the marketplace over the past 15 years is not only made possible by the lenders, but "behind the scenes" a loyal support staff, administrative staff and risk management personnel makes it possible for the lenders to perform at a high level; furthermore, a tenured local Board of Directors helps steer the strategic direction of the organization while staying engaged in the local community. These long-term bank employees/stakeholders have once again delivered during another chaotic year of COVID-19 disruptions.

"Based on the year-over-year 16% plus loan growth (net PPP) we experienced in 2021, the continuation of a robust loan pipeline, the resiliency of the Bank's credit quality and the favorable overall economic outlook for Arizona in 2022, my optimism remains high for strong traditional lending opportunities in 2022.

"The remaining PPP loans are essentially a non-factor on the Bank's loan portfolio and income statement. We currently have approximately $6 million on the books and we anticipate our PPP portfolio to be retired in short order.

"Asset quality remains unchanged and the Bank is operating with an ALLL that has a surplus, or unallocated balance in the reserves. The portfolio continues to perform well in light of the recent disruption created by the COVID-19 Omicron variant."

Fourth Quarter 2021 Highlights

  • Net Income for the quarter was $1,951,000 or $0.52 per diluted share.
    • ROA of 1.85% for the quarter
    • ROE of 18.21% for the quarter
  • NIM of 3.86% for the quarter, with the cost of funds falling to 0.28%; relatively unchanged when compared to the linked quarter cost of funds of 0.30%.
  • SBA Gains on Sale of $629,996 for the quarter.
  • Provision Expense of $0 for the quarter.
  • Efficiency Ratio of 45.62% for the quarter.
  • Loan growth (net PPP) of 5.20% for the quarter.
  • Deposits declined by 0.48% for the quarter.
  • Non-Performing Asset Ratio is 0.00%, no significant change from the linked quarter.

Balance Sheet
Total assets grew by 0.03% to $411.6 million at December 31, 2021 and increased 26.26% compared to $326.0 million a year ago. Total loans increased by 2.23% to $293.1 million at December 31, 2021 and increased 4.79% compared to $279.3 million a year ago. Excluding PPP loans, at the end of Q4, loans increased 5.20% compared to Q3 and increased 16.27% compared to a year ago. Total deposits declined by 0.48% to $364.6 million at December 31, 2021 and increased 29.38% compared to $281.8 million a year ago.

The allowance for loan losses totaled $3.775 million at December 31, 2021, or 1.29% of total loans. Excluding the PPP loan balance of $6.5 million, an adjusted allowance for loan losses equates to 1.32% of total loans. No material changes have occurred in the reported credit quality of the loan portfolio since the preceding quarter.

Shareholders' equity increased to $43.38 million at December 31, 2021, from $41.37 million the preceding quarter and increased 12.21% compared to $38.66 million a year ago.  At December 31, 2021, book value and tangible book value were $12.42 per share compared to $11.88 per share at September  30, 2021 and $11.11 per share a year ago.

Capital Management
The Bank's capital ratio exceeded the regulatory guidelines established under Section 201 of the Economic Regulatory Relief and Consumer Protection Act. Effective January 2020, community banks are tested for capital health based on a single capital ratio, the Community Bank Leverage Ratio (CBLR). The Bank reported the following capital ratio:

Regulatory Capital Ratio

Bank

12/31/21

Regulatory

Minimum Requirement

Community Bank Leverage Ratio

10.32%

8.50%

About the Company
Metro Phoenix Bank, Inc., established in 2007 and headquartered in Phoenix, Arizona, is a full-service community bank that caters to small- to mid-sized businesses and real estate professionals. MPB offers commercial clients a variety of services ranging from Commercial Real Estate Lending, Outdoor Media Lending, SBA financing solutions, and a robust treasury management platform that includes a Homeowners Association (HOA)/Property Management specialty program. The bank holding company (MPB BHC, INC.) is traded over the counter as MPHX. For additional information, visit: www.metrophoenixbank.com.

Forward-looking Statements
This press release may include forward-looking statements about Metro Phoenix Bank. These statements involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such risks and uncertainties include, but are not limited to, the following factors: competition, fluctuations in interest rates, dependency on key individuals, loan defaults, geographical concentration, litigation and changes in federal laws, regulations, and interpretations thereof. All forward-looking statements included in this press release are based on information available at the time of the release. Metro Phoenix Bank assumes no obligation to update any forward-looking statement.

Unaudited Summary Financial Information

(dollars in thousands, except per share data or noted otherwise)














For the Three months


For the Twelve months





ended December 31,


ended December 31,


Year-End



2021


2020


2021


2020


2020

Summary Income Data











Interest Income


4,231


3,607


15,780


14,568


14,568

Interest expense 


295


277


1,150


1,351


1,351

Net Interest Income


3,936


3,330


14,630


13,217


13,217

Provision for (reduction in) loan losses 


-


250


250


1,600


1,600

Provision for (reduction in) unfunded commitments


-


-


-


-


-

Non-interest income 


851


321


3,220


1,800


1,800

Non-interest expense 


2,184


1,721


8,163


6,797


6,797

Realized gains (losses) on sales of securities 


-


-


-


-


-

Income (loss) before income taxes 


2,603


1,680


9,437


6,620


6,620

Provision for income tax 


652


397


2,268


1,581


1,581

Net Income 


1,951


1,283


7,169


5,039


5,039












Per Share Data











Shares outstanding end-of-period 


3,492


3,481


3,492


3,481


3,481

Earnings per common share 


0.56


0.37


2.05


1.45


1.45

Earnings per common share (Diluted) 


0.52


0.34


1.90


1.34


1.34

Cash dividend declared 


-


-


0.725


-


-

Total shareholders' equity 


43,380


38,662


43,380


38,662


38,662

Book value per share 


12.42


11.11


12.42


11.11


11.11












Selected Balance Sheet Data











Total assets 


411,548


326,012


411,548


326,012


326,012

Securities available-for-sale


160


436


160


436


436

Loans 


293,132


279,730


293,132


279,730


279,730

Allowance for loan losses


3,775


3,475


3,775


3,475


3,475

Deposits 


364,613


281,827


364,613


281,827


281,827

Other borrowings 


3,100


3,100


3,100


3,100


3,100

Shareholders' equity 


43,380


38,662


43,380


38,662


38,662












Performance Ratios











Return on average shareholders' equity (annualized) (%) 


18.21%


13.38%


17.57%


13.71%


13.71%

Net interest margin (%) 


3.86%


4.31%


4.01%


4.53%


4.53%

Cost of Funds 


0.28%


0.34%


0.28%


0.34%


0.34%

Average assets 


418,597


326,436


394,346


305,070


305,070

Return on average assets (annualized) (%) 


1.85%


1.56%


1.82%


1.65%


1.65%

Shareholders' equity to assets (%) 


10.54%


11.86%


10.54%


11.86%


11.86%

Efficiency ratio (%) 


45.62%


47.14%


45.73%


45.26%


45.26%












Asset Quality Data











Nonaccrual loans 


-


-


-


-


-

Troubled debt restructurings 


-


2


-


2


2

Other real estate


-


-


-


-


-

Nonperforming assets 


-


-


-


-


-

Nonperforming assets to total assets (%)


0.00%


0.00%


0.00%


0.00%


0.00%

Nonperforming loans to total loans (%) 


0.00%


0.00%


0.00%


0.00%


0.00%

Reserve for loan losses to total loans (%) 


1.29%


1.24%


1.29%


1.24%


1.24%

Reserve for loan losses to nonperforming loans (%) 


0.00%


0.00%


0.00%


0.00%


0.00%

Reserve for loan losses to nonperforming assets (%) 


0.00%


0.00%


0.00%


0.00%


0.00%

Net charge-offs for period 


(20)


-


(50)


-


-

Average loans


288,772


266,861


286,853


228,872


228,872

Ratio of charge-offs to average loans (%) 


-0.01%


0.00%


-0.02%


0.00%


0.00%












Regulatory Capital Ratios











Community Bank Leverage Ratio (CBLR) 


10.32%


11.84%


10.32%


11.84%


11.84%

Tier 1 leverage capital ratio (%) 


 N/A 


N/A


 N/A 


N/A


N/A

Common Equity Tier 1 (%) 


 N/A 


N/A


 N/A 


N/A


N/A

Tier 1 risk-based capital ratio (%) 


 N/A 


N/A


 N/A 


N/A


N/A

Total risk-based capital ratio (%) 


 N/A 


N/A


 N/A 


N/A


N/A

 

Contact:

Stephen P. Haggard


President & CEO


602-346-1800


shaggard@metrophoenixbank.com

 

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SOURCE Metro Phoenix Bank