Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries RBB Bancorp Reports Second Quarter Earnings for 2022 By: RBB Bancorp via Business Wire July 25, 2022 at 16:05 PM EDT Conference Call and Webcast Scheduled for Tuesday, July 26, 2022 at 11:00 a.m. Pacific Time/2:00 p.m. Eastern Time Second Quarter 2022 Highlights Net income of $15.5 million, or $0.80 diluted earnings per share, increased $860,000, or 5.9%, from the prior quarter and increased $2.1 million, or 15.7%, from the second quarter of 2021 Loans grew by $35.9 million, or 4.8% annualized, from the end of the prior quarter Declared $0.14 per share quarterly dividend RBB Bancorp (NASDAQ:RBB) and its subsidiaries, Royal Business Bank (“the Bank”) and RBB Asset Management Company (“RAM”), collectively referred to herein as “the Company,” announced financial results for the quarter ended June 30, 2022. The Company reported net income of $15.5 million, or $0.80 diluted earnings per share, for the three months ended June 30, 2022, compared to net income of $14.6 million, or $0.74 diluted earnings per share, and $13.4 million, or $ 0.67 diluted earnings per share, for the three months ended March 31, 2022 and June 30, 2021, respectively. “Our performance in the second quarter demonstrated the strength of our differentiated business model as the Bank delivered strong earnings, improving margins, and loan growth,” said David Morris, Interim President and CEO of RBB Bancorp. “Expenses were higher than expected due to the ongoing costs related to the Board of Directors investigation, which we expect to wind down in the third quarter. We were pleased to announce several new hires and re-hires during the quarter and look forward to working with our new colleagues to build shareholder value.” "The excellent second quarter results demonstrate the value of Royal Business Bank," said Dr. James Kao, Chairman of RBB Bancorp. “The Bank is well-positioned to continue to generate attractive returns and shareholder value.” Key Performance Ratios Net income of $15.5 million for the second quarter of 2022 produced an annualized return on average assets ("ROA") of 1.60%, an annualized return on average tangible common shareholders' equity ("ROTCE") of 15.89%, and an annualized return on average shareholders' equity ("ROE") of 13.30%. This compares to an annualized ROA of 1.39%, an annualized ROTCE of 14.91%, and an annualized ROE of 12.59% for the first quarter of 2022. The efficiency ratio for the second quarter of 2022 was 43.47%, compared to 42.90% for the prior quarter. Net Interest Income and Net Interest Margin Net interest income, before provision for loan losses, was $37.1 million for the second quarter of 2022, compared to $34.5 million for the first quarter of 2022. The $2.6 million increase was primarily attributable to 1.25% increase in interest rate by Federal Reserve Bank in the second quarter of 2022. Accretion of purchase discounts from prior acquisitions contributed $75,000 to net interest income in the second quarter of 2022, compared to $246,000 in the first quarter of 2022. Compared to the second quarter of 2021, net interest income, before provision for loan losses, increased $7.0 million from $30.1 million. The increase was primarily attributable to a $289.3 million increase in average loans and a 1.25% increase in interest rate by the Federal Reserve Bank in the second quarter of 2022. The increases in average earning assets were primarily due to increased loan originations. Net interest margin was 4.08% for the second quarter of 2022, an increase of 59 basis points from 3.49% in the first quarter of 2022. Loan discount accretion contributed 1 basis point to the net interest margin in the second quarter of 2022, compared to 2 basis points in the first quarter of 2022. Noninterest Income Noninterest income was $3.4 million for the second quarter of 2022, an increase of $478,000 from $2.9 million in the first quarter of 2022. The increase was primarily driven by a $757,000 increase in gain on sale of corporate real estate, a $272,000 decrease in loss on derivatives and a $94,000 increase in recoveries on purchased loans, partially offset by an $830,000 decrease in gain on sale of loans during the quarter. The Company sold $12.6 million in FNMA qualified mortgage loans for a net gain of $284,000 during the second quarter of 2022 compared to $26.9 million in FNMA qualified mortgage loans sold for a net gain of $711,000 during the first quarter of 2022. The Company sold $1.1 million in SBA loans during the second quarter of 2022 for a net gain of $60,000, compared to $8.3 million SBA loans sold for a net gain of $463,000 during the first quarter of 2022. Compared to the second quarter of 2021, noninterest income decreased by $749,000 from $4.2 million. The decrease was primarily attributable to a $2.2 million decrease in gain on sale of loans, partially offset by a $757,000 increase in gain on corporate real estate, a $354,000 increase in loan servicing fees, an $113,000 increase in income from bank owned life insurance and a $93,000 increase in recoveries on purchased loans. Noninterest Expense Noninterest expense for the second quarter of 2022 was $17.6 million, compared to $16.1 million for the first quarter of 2022. The $1.6 million increase was primarily attributable to a $1.2 million increase in legal and professional expenses due to a Board of Director special investigation and a $259,000 increase in salaries and employee benefits expense due to additional new hires and salary adjustments to reflect economic inflation. Noninterest expense increased from $14.7 million in the second quarter of 2021. The $2.9 million increase was primarily due to a $1.7 million increase in legal and professional expenses due to a Board of Director special investigation, an $886,000 increase in salaries and employee benefits expenses and a $270,000 increase in business promotion and CRA donation expenses. Income Taxes The effective tax rate was 29.6% for the second quarter of 2022, 30.4% for the first quarter of 2022, and 29.3% for the second quarter of 2021. The Company recognized a tax benefit from stock option exercises of $279,000, $23,000 and $68,000 for the second quarter of 2022, the first quarter of 2022, and the second quarter of 2021, respectively. Loan and Securities Portfolio Loans held for investment, net of deferred fees and discounts, totaled $3.05 billion as of June 30, 2022, an increase of $39.5 million from March 31, 2022, and an increase of $336.7 million from June 30, 2021. The increase from the prior quarter was primarily due to a $141.2 million increase in single-family residential mortgage loans and a $10.0 million increase in construction & land development loans, partially offset by a $57.6 million decrease in commercial real estate loans and a $42.8 million decrease in commercial and industrial loans. The increase from June 30, 2021 was primarily due to a $221.4 million increase in single-family residential mortgages and a $119.8 million increase in construction & land development loans. During the second quarter of 2022, single-family residential mortgage production was $216.9 million while net payoffs and paydowns were $66.8 million. During the first quarter of 2022, single-family residential mortgage production was $132.6 million while payoffs and paydowns were $48.1 million. There were no mortgage loans held for sale as of June 30, 2022 compared to $3.6 million as of March 31, 2022 and $9.2 million as of June 30, 2021. The Company originated approximately $1.2 million in FNMA mortgage loans for sale for the second quarter of 2022, compared with $23.4 million during the prior quarter. In the second quarter of 2022, SBA loan production was $1.4 million and total SBA loan sales were $1.1 million compared to SBA loan production of $11.9 million and total SBA loan sales of $8.3 million in the first quarter of 2022. As of June 30, 2022, the Bank’s total Available-for-Sale securities maturing in over 12 months were $249.2 million, and the Bank recorded an unrealized loss of $20.2 million under the Accumulated Other Comprehensive Income (AOCI) since January 1, 2022. Deposits Deposits were $3.0 billion at June 30, 2022, which was a decrease of $140.7 million compared to March 31, 2022. During the second quarter of 2022, noninterest-bearing deposits decreased by $114.7 million, interest-bearing non-maturity deposits decreased by $16.7 million, and time deposits decreased by $9.3 million. As of June 30, 2022, there were $50.0 million in brokered CDs, as compared to no brokered CDs as of March 31, 2022 and $17.4 million brokered CDs as of June 30, 2021. Compared to June 30, 2021, total deposits decreased by $42.4 million primarily due to a $157.0 million decrease in time deposits, partially offset by a $105.0 million increase in noninterest-bearing demand deposits. Asset Quality Nonperforming assets totaled $14.2 million, or 0.36% of total assets at June 30, 2022, compared to $21.0 million, or 0.52% of total assets at March 31, 2022. The decrease in nonperforming assets was due to the pay-off of certain nonperforming loans in the second quarter. Nonperforming assets consist of other real estate owned, loans modified under troubled debt restructurings (“TDR”), non-accrual loans, and loans past due 90 days or more and still accruing interest. In the second quarter of 2022, there were $53,000 in net charge-offs, compared to net recoveries of $14,000 in the first quarter of 2022 and net charge-offs of $71,000 in the second quarter of 2021. The Company recorded a provision for credit losses of $915,000 for the second quarter of 2022 which was primarily attributable to loan growth and was an increase from $366,000 in the prior quarter. Allowance for loan losses continue to include $599,000 of reserves taken as a precaution against COVID-19 losses in 2020 and 2021. The allowance for loan losses totaled $34.2 million, or 1.12% of loans held for investment at June 30, 2022, compared with $33.3 million, or 1.11%, of total loans at March 31, 2022. During the second quarter of 2022, the Company repurchased 525,754 common shares at a weighted average price of $21.10. Corporate Overview RBB Bancorp is a community-based financial holding company headquartered in Los Angeles, California. As of June 30, 2022, the company had total assets of $4.0 billion. Its wholly-owned subsidiary, the Bank is a full service commercial bank, which provides business banking services to the Chinese-American communities in Los Angeles County, Orange County, and Ventura County in California, in Las Vegas, Nevada, in Brooklyn, Queens, and Manhattan in New York, in Edison, New Jersey, in the Chicago neighborhoods of Chinatown and Bridgeport, Illinois, and on Oahu, Hawaii. Bank services include remote deposit, E-banking, mobile banking, commercial and investor real estate loans, business loans and lines of credit, commercial and industrial loans, SBA 7A and 504 loans, 1-4 single family residential loans, automobile lending, trade finance, a full range of depository account products and wealth management services. The Bank has nine branches in Los Angeles County, two branches in Ventura County, one branch in Orange County, California, one branch in Las Vegas, Nevada, three branches and one loan operation center in Brooklyn, three branches in Queens, one branch in Manhattan in New York, one branch in Edison, New Jersey, two branches in Chicago, Illinois, and one branch in Honolulu, Hawaii. The Company's administrative and lending center is located at 1055 Wilshire Blvd., Los Angeles, California 90017, and its finance and operations center is located at 7025 Orangethorpe Ave., Buena Park, California 90621. The Company's website address is www.royalbusinessbankusa.com. Conference Call Management will hold a conference call at 11:00 a.m. Pacific time/2:00 p.m. Eastern time tomorrow, July 26, 2022, to discuss the Company’s second quarter 2022 financial results. To listen to the conference call, please dial 1-866-459-5346 or 1-203-518-9544, conference ID RBBQ222. A replay of the call will be made available at 1-877-274-8334 or 1-402-220-2326 (no passcode required) approximately one hour after the conclusion of the call and will remain available through August 2, 2022. The conference call will also be simultaneously webcast over the Internet; please visit our Royal Business Bank website at www.royalbusinessbankusa.com and click on the “Investors” tab to access the call from the site. This webcast will be recorded and available for replay on our website approximately two hours after the conclusion of the conference call. Disclosure This press release contains certain non-GAAP financial disclosures for tangible common equity and tangible assets and adjusted earnings. The Company uses certain non- GAAP financial measures to provide meaningful supplemental information regarding the Company’s operational performance and to enhance investors’ overall understanding of such financial performance. Please refer to the tables at the end of this release for a presentation of performance ratios in accordance with GAAP and a reconciliation of the non-GAAP financial measures to the GAAP financial measures. Safe Harbor Certain matters set forth herein (including the exhibits hereto) constitute forward-looking statements relating to the Company’s current business plans and expectations and our future financial position and operating results. These forward-looking statements are subject to risks and uncertainties that could cause actual results, performance and/or achievements to differ materially from those projected. These risks and uncertainties include, but are not limited to, local, regional, national and international economic and market conditions and events and the impact they may have on us, our customers and our assets and liabilities; our ability to attract deposits and other sources of funding or liquidity; supply and demand for real estate and periodic deterioration in real estate prices and/or values in California or other states where we lend, including both residential and commercial real estate; a prolonged slowdown or decline in real estate construction, sales or leasing activities; changes in the financial performance and/or condition of our borrowers, depositors or key vendors or counterparties; changes in our levels of delinquent loans, nonperforming assets, allowance for loan losses and charge-offs; expectations regarding the impact of the COVID-19 pandemic; the costs or effects of acquisitions or dispositions we may make, whether we are able to obtain any required governmental or shareholder approvals in connection with any such acquisitions or dispositions, and/or our ability to realize the contemplated financial or business benefits associated with any such acquisitions or dispositions; the effect of changes in laws, regulations and applicable judicial decisions (including laws, regulations and judicial decisions concerning financial reforms, taxes, banking capital levels, consumer, commercial or secured lending, securities and securities trading and hedging, compliance, employment, executive compensation, insurance, vendor management and information security) with which we and our subsidiaries must comply or believe we should comply; changes in estimates of future reserve requirements and minimum capital requirements based upon the periodic review thereof under relevant regulatory and accounting requirements, including changes in the Basel Committee framework establishing capital standards for credit, operations and market risk; inflation, interest rate, securities market and monetary fluctuations; changes in government interest rates or monetary policies; changes in the amount and availability of deposit insurance; cyber-security threats, including loss of system functionality or theft or loss of Company or customer data or money; political instability; acts of war or terrorism, or natural disasters, such as earthquakes, drought, or the effects of pandemic diseases; the timely development and acceptance of new banking products and services and the perceived overall value of these products and services by our customers and potential customers; the Company’s relationships with and reliance upon vendors with respect to the operation of certain of the Company’s key internal and external systems and applications; changes in commercial or consumer spending, borrowing and savings preferences or behaviors; technological changes and the expanding use of technology in banking (including the adoption of mobile banking and funds transfer applications); the ability to retain and increase market share, retain and grow customers and control expenses; changes in the competitive and regulatory environment among financial and bank holding companies, banks and other financial service providers; volatility in the credit and equity markets and its effect on the general economy or local or regional business conditions; fluctuations in the price of the Company’s common stock or other securities; and the resulting impact on the Company’s ability to raise capital or make acquisitions, the effect of changes in accounting policies and practices, as may be adopted from time-to-time by our regulatory agencies, as well as by the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard-setters, including ASU 2016-13 (Topic 326), “Measurement of Credit Losses on Financial Instruments”, commonly referenced as the Current Expected Credit Loss (“CECL”) model, which will change how we estimate credit losses and may increase the required level of our allowance for credit losses after adoption; changes in our organization, management, compensation and benefit plans, and our ability to retain or expand our workforce, management team and/or our board of directors; the costs and effects of legal, compliance and regulatory actions, changes and developments, including the initiation and resolution of legal proceedings (such as securities, consumer or employee class action litigation), regulatory or other governmental inquiries or investigations, and/or the results of regulatory examinations or reviews; our ongoing relations with our various federal and state regulators, including the SEC, FDIC, FRB and California DFPI (formerly DBO); our success at managing the risks involved in the foregoing items and all other factors set forth in the Company’s public reports, including its Annual Report as filed under Form 10-K/A and Form 10-K for the year ended December 31, 2021, and particularly the discussion of risk factors within that document. The Company does not undertake, and specifically disclaims any obligation, to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements except as required by law. Any statements about future operating results, such as those concerning accretion and dilution to the Company’s earnings or shareholders, are for illustrative purposes only, are not forecasts, and actual results may differ. RBB BANCORP AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited, except for December 31, 2021) (Dollars in thousands) June 30, March 31, December 31, September 30, June 30, 2022 2022 2021 2021 2021 Assets Cash and due from banks $ 224,736 $ 149,767 $ 501,372 $ 206,927 $ 493,653 Federal funds sold and other cash equivalents 100,000 200,000 193,000 170,000 110,000 Total cash and cash equivalents 324,736 349,767 694,372 376,927 603,653 Interest-bearing deposits in other financial institutions 600 600 600 600 600 Investment securities available for sale 358,135 420,448 368,260 345,000 339,568 Investment securities held to maturity 5,741 6,246 6,252 6,258 6,664 Mortgage loans held for sale — 3,572 5,957 15,188 9,246 Loans held for investment 3,045,946 3,006,484 2,931,350 2,840,354 2,709,206 Allowance for loan losses (34,154 ) (33,292 ) (32,912 ) (32,231 ) (31,352 ) Net loans held for investment 3,011,792 2,973,192 2,898,438 2,808,123 2,677,854 Premises and equipment, net 27,104 27,455 27,199 27,157 27,039 Federal Home Loan Bank (FHLB) stock 15,000 15,000 15,000 15,000 15,000 Cash surrender value of life insurance 56,642 56,313 55,988 55,656 55,325 Goodwill 71,498 71,498 69,243 69,243 69,243 Servicing assets 10,456 11,048 11,517 12,141 12,558 Core deposit intangibles 4,248 4,525 4,075 4,327 4,608 Right-of-use assets- operating leases 21,166 22,451 22,454 23,735 25,050 Accrued interest and other assets 57,153 51,454 48,839 42,452 44,230 Total assets $ 3,964,271 $ 4,013,569 $ 4,228,194 $ 3,801,807 $ 3,890,638 Liabilities and shareholders' equity Deposits: Noninterest-bearing demand $ 1,045,009 $ 1,159,703 $ 1,291,484 $ 824,771 $ 940,041 Savings, NOW and money market accounts 868,307 885,050 927,609 931,517 858,597 Time deposits, less than $250,000 574,050 570,274 587,940 614,146 658,393 Time deposits, greater than or equal to $250,000 540,199 553,226 578,499 597,379 612,894 Total deposits 3,027,565 3,168,253 3,385,532 2,967,813 3,069,925 Reserve for unfunded commitments 1,070 1,186 1,203 1,304 1,216 FHLB advances 250,000 150,000 150,000 150,000 150,000 Long-term debt, net of debt issuance costs 173,296 173,152 173,007 172,862 172,718 Subordinated debentures 14,611 14,556 14,502 14,447 14,393 Lease liabilities - operating leases 22,057 23,314 23,282 24,524 25,798 Accrued interest and other liabilities 11,965 18,283 13,985 14,833 14,263 Total liabilities 3,500,564 3,548,744 3,761,511 3,345,783 3,448,313 Shareholders' equity: Shareholder's equity 479,382 475,077 468,267 456,490 442,086 Non-controlling interest 72 72 72 72 72 Accumulated other comprehensive (loss) income - Net of tax (15,747 ) (10,324 ) (1,656 ) (538 ) 167 Total shareholders' equity 463,707 464,825 466,683 456,024 442,325 Total liabilities and shareholders’ equity $ 3,964,271 $ 4,013,569 $ 4,228,194 $ 3,801,807 $ 3,890,638 RBB BANCORP AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Dollars in thousands, except per share amounts) For the Three Months Ended June 30, 2022 March 31, 2022 June 30, 2021 Interest and dividend income: Interest and fees on loans $ 40,157 $ 37,886 $ 34,669 Interest on interest-bearing deposits 111 171 125 Interest on investment securities 1,419 1,007 794 Dividend income on FHLB stock 222 227 225 Interest on federal funds sold and other 429 275 158 Total interest income 42,338 39,566 35,971 Interest expense: Interest on savings deposits, NOW and money market accounts 844 718 708 Interest on time deposits 1,506 1,574 2,410 Interest on subordinated debentures and long term debt 2,379 2,348 2,356 Interest on other borrowed funds 519 435 440 Total interest expense 5,248 5,075 5,914 Net interest income before provision for loan losses 37,090 34,491 30,057 Provision for loan losses 915 366 628 Net interest income after provision for loan losses 36,175 34,125 29,429 Noninterest income: Service charges, fees and other 1,382 1,241 1,332 Gain on sale of loans 344 1,174 2,572 Loan servicing fees, net of amortization 472 432 118 Recoveries on loans acquired in business combinations 98 5 5 Unrealized (loss) on equity investments — — (35 ) Gain (loss) on derivatives 39 (233 ) (38 ) Increase in cash surrender value of life insurance 330 325 217 Gain on sale of fixed assets 757 — — Total noninterest income 3,422 2,944 4,171 Noninterest expense: Salaries and employee benefits 9,628 9,369 8,742 Occupancy and equipment expenses 2,174 2,206 2,135 Data processing 1,293 1,258 1,231 Legal and professional 2,254 1,006 536 Office expenses 358 293 272 Marketing and business promotion 501 307 231 Insurance and regulatory assessments 478 441 354 Core deposit premium 277 279 287 OREO expenses 5 8 4 Merger expenses 23 37 17 Other expenses 621 857 871 Total noninterest expense 17,612 16,061 14,680 Income before income taxes 21,985 21,008 18,920 Income tax expense 6,508 6,391 5,540 Net income $ 15,477 $ 14,617 $ 13,380 Net income per share Basic $ 0.81 $ 0.75 $ 0.69 Diluted $ 0.80 $ 0.74 $ 0.67 Cash Dividends declared per common share $ 0.14 $ 0.14 $ 0.13 Weighted-average common shares outstanding Basic 19,066,621 19,377,407 19,432,204 Diluted 19,368,860 19,799,323 19,874,969 RBB BANCORP AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Dollars in thousands, except per share amounts) For the Six Months Ended June 30, 2022 June 30, 2021 Interest and dividend income: Interest and fees on loans $ 78,043 $ 69,185 Interest on interest-earning deposits 282 173 Interest on investment securities 2,426 1,421 Dividend income on FHLB stock 449 417 Interest on federal funds sold and other 704 315 Total interest income 81,904 71,511 Interest expense: Interest on savings deposits, NOW and money market accounts 1,562 1,406 Interest on time deposits 3,080 5,374 Interest on subordinated debentures and long term debt 4,727 4,314 Interest on other borrowed funds 954 875 Total interest expense 10,323 11,969 Net interest income 71,581 59,542 Provision for loan losses 1,282 2,128 Net interest income after provision for loans losses 70,299 57,414 Noninterest income: Service charges, fees and other (1) 2,622 2,800 Gain on sale of loans 1,518 6,413 Loan servicing fees, net of amortization 904 364 Recoveries on loans acquired in business combinations 103 10 Unrealized (loss) gain on equity investments — (55 ) (Loss) gain on derivatives (194 ) 129 Increase in cash surrender value of life insurance 654 404 Gain on sale of fixed assets 757 — Total noninterest income 6,364 10,065 Noninterest expense: Salaries and employee benefits 18,997 17,984 Occupancy and equipment expenses 4,380 4,377 Data processing 2,551 2,671 Legal and professional 3,260 1,341 Office expenses 651 527 Marketing and business promotion 808 415 Insurance and regulatory assessments 919 702 Core deposit premium 556 588 OREO expenses 13 9 Merger expenses 60 59 Other expenses 1,475 1,799 Total noninterest expense 33,670 30,472 Income before income taxes 42,993 37,007 Income tax expense 12,899 11,171 Net income $ 30,094 $ 25,836 Net income per share Basic $ 1.56 $ 1.32 Diluted $ 1.54 $ 1.30 Cash Dividends declared per common share $ 0.28 $ 0.25 Weighted-average common shares outstanding Basic 19,221,155 19,453,889 Diluted 19,582,902 19,844,077 RBB BANCORP AND SUBSIDIARIES AVERAGE BALANCE SHEET AND NET INTEREST INCOME (Unaudited) (Dollars in thousands, except per share amounts) For the three months ended June 30, 2022 March 31, 2022 June 30, 2021 Average Interest Yield / Average Interest Yield / Average Interest Yield / (tax-equivalent basis, dollars in thousands) Balance & Fees Rate Balance & Fees Rate Balance & Fees Rate Earning assets: Federal funds sold, cash equivalents & other (1) $ 249,738 $ 762 1.22 % $ 628,634 $ 673 0.43 % $ 582,554 $ 508 0.35 % Securities Available for sale (2) 399,321 1,393 1.40 % 392,858 974 1.01 % 328,004 751 0.92 % Held to maturity (2) 5,744 50 3.49 % 6,250 57 3.70 % 6,667 60 3.61 % Mortgage loans held for sale 892 13 5.85 % 3,652 43 4.78 % 21,033 173 3.30 % Loans held for investment: (3) Real estate 2,663,753 35,207 5.30 % 2,602,382 33,095 5.16 % 2,292,145 29,794 5.21 % Commercial 325,861 4,937 6.08 % 380,978 4,748 5.05 % 388,049 4,702 4.86 % Total loans 2,989,614 40,144 5.39 % 2,983,360 37,843 5.14 % 2,680,194 34,496 5.16 % Total earning assets 3,645,309 $ 42,362 4.66 % 4,014,754 $ 39,590 4.00 % 3,618,452 $ 35,988 3.99 % Noninterest-earning assets 243,227 241,235 230,049 Total assets $ 3,888,536 $ 4,255,989 $ 3,848,501 Interest-bearing liabilities NOW $ 75,637 $ 50 0.27 % $ 75,399 $ 43 0.23 % $ 66,777 $ 45 0.27 % Money Market 631,807 759 0.48 % 720,197 643 0.36 % 640,026 628 0.39 % Saving deposits 148,400 35 0.09 % 145,327 32 0.09 % 140,418 35 0.10 % Time deposits, less than $250,000 553,282 724 0.52 % 600,563 754 0.51 % 657,494 1,163 0.71 % Time deposits, $250,000 and over 526,164 782 0.60 % 570,210 820 0.58 % 604,429 1,247 0.83 % Total interest-bearing deposits 1,935,290 2,350 0.49 % 2,111,696 2,292 0.44 % 2,109,144 3,118 0.59 % FHLB advances 182,749 519 1.14 % 150,000 435 1.18 % 150,000 440 1.18 % Long-term debt 173,201 2,195 5.08 % 173,058 2,194 5.14 % 172,622 2,206 5.13 % Subordinated debentures 14,575 184 5.06 % 14,521 154 4.30 % 14,357 150 4.19 % Total interest-bearing liabilities 2,305,815 5,248 0.91 % 2,449,275 5,075 0.84 % 2,446,123 5,914 0.97 % Noninterest-bearing liabilities Noninterest-bearing deposits 1,082,793 1,301,497 913,442 Other noninterest-bearing liabilities 33,325 34,319 46,549 Total noninterest-bearing liabilities 1,116,118 1,335,816 959,991 Shareholders' equity 466,603 470,898 442,387 Total liabilities and shareholders' equity $ 3,888,536 $ 4,255,989 $ 3,848,501 Net interest income / interest rate spreads $ 37,114 3.75 % $ 34,515 3.16 % $ 30,074 3.02 % Net interest margin 4.08 % 3.49 % 3.33 % (1) Includes income and average balances for FHLB stock, term federal funds, interest-bearing time deposits and other miscellaneous interest-bearing assets. (2) Interest income and average rates for tax-exempt loans and securities are presented on a tax-equivalent basis. (3) Average loan balances include nonaccrual loans and loans held for sale. Interest income on loans includes - amortization of deferred loan fees, net of deferred loan costs. RBB BANCORP AND SUBSIDIARIES AVERAGE BALANCE SHEET AND NET INTEREST INCOME (Unaudited) (Dollars in thousands, except per share amounts) For the six months ended June 30, 2022 June 30, 2021 Average Interest Yield / Average Interest Yield / (tax-equivalent basis, dollars in thousands) Balance & Fees Rate Balance & Fees Rate Earning assets: Federal funds sold, cash equivalents & other (1) $ 438,140 $ 1,435 0.66 % $ 399,907 $ 905 0.46 % Securities Available for sale (2) 396,107 2,367 1.21 % 284,129 1,323 0.94 % Held to maturity (2) 5,996 107 3.60 % 6,832 126 3.72 % Mortgage loans held for sale 2,265 56 4.99 % 37,436 584 3.15 % Loans held for investment: (3) Real estate 2,633,237 68,302 5.23 % 2,299,746 59,315 5.20 % Commercial 353,267 9,685 5.53 % 386,256 9,286 4.85 % Total loans 2,986,504 77,987 5.27 % 2,686,002 68,601 5.15 % Total earning assets 3,829,012 $ 81,952 4.32 % 3,414,306 $ 71,539 4.23 % Noninterest-earning assets 242,235 229,032 Total assets $ 4,071,247 $ 3,643,338 Interest-bearing liabilities NOW $ 75,519 $ 94 0.25 % $ 65,690 $ 88 0.27 % Money Market 675,758 1,401 0.42 % 609,854 1,251 0.41 % Saving deposits 146,872 67 0.09 % 135,810 67 0.10 % Time deposits, less than $250,000 576,792 1,478 0.52 % 660,246 2,659 0.81 % Time deposits, $250,000 and over 548,065 1,602 0.59 % 599,234 2,716 0.91 % Total interest-bearing deposits 2,023,006 4,642 0.46 % 2,070,834 6,781 0.66 % FHLB advances 166,465 954 1.16 % 150,000 875 1.18 % Long-term debt 173,129 4,388 5.11 % 142,349 4,015 5.69 % Subordinated debentures 14,548 339 4.70 % 14,330 298 4.19 % Total interest-bearing liabilities 2,377,148 $ 10,323 0.88 % 2,377,513 $ 11,969 1.02 % Noninterest-bearing liabilities Noninterest-bearing deposits 1,191,540 784,276 Other noninterest-bearing liabilities 33,820 43,352 Total noninterest-bearing liabilities 1,225,360 827,628 Shareholders' equity 468,739 438,197 Total liabilities and shareholders' equity $ 4,071,247 $ 3,643,338 Net interest income / interest rate spreads $ 71,629 3.44 % $ 59,570 3.21 % Net interest margin 3.77 % 3.52 % (1) Includes income and average balances for FHLB stock, term federal funds, interest-bearing time deposits and other miscellaneous interest-bearing assets. (2) Interest income and average rates for tax-exempt loans and securities are presented on a tax-equivalent basis. (3) Average loan balances include nonaccrual loans and loans held for sale. Interest income on loans includes - amortization of deferred loan fees, net of deferred loan costs. RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) For the three months ended June 30, March 31, June 30, 2022 2022 2021 Per share data (common stock) Earnings Basic $ 0.81 $ 0.75 $ 0.69 Diluted $ 0.80 $ 0.74 $ 0.67 Dividends declared $ 0.14 $ 0.14 $ 0.13 Book value $ 24.56 $ 24.15 $ 22.86 Tangible book value $ 20.55 $ 20.20 $ 19.04 Weighted average shares outstanding Basic 19,066,621 19,377,407 19,432,204 Diluted 19,368,860 19,799,323 19,874,969 Shares outstanding at period end 18,881,829 19,247,970 19,349,802 Performance ratios Return on average assets, annualized 1.60 % 1.39 % 1.39 % Return on average shareholders' equity, annualized 13.30 % 12.59 % 12.13 % Return on average tangible common equity, annualized 15.89 % 14.91 % 14.57 % Noninterest income to average assets, annualized 0.35 % 0.28 % 0.43 % Noninterest expense to average assets, annualized 1.82 % 1.53 % 1.53 % Yield on average earning assets 4.66 % 4.00 % 3.99 % Cost of average total deposits 0.31 % 0.27 % 0.41 % Cost of average interest-bearing deposits 0.49 % 0.44 % 0.59 % Cost of average interest-bearing liabilities 0.91 % 0.84 % 0.97 % Accretion on loans to average earning assets 0.01 % 0.02 % 0.02 % Net interest spread 3.75 % 3.16 % 3.02 % Net interest margin 4.08 % 3.49 % 3.33 % Efficiency ratio 43.47 % 42.90 % 42.89 % Common stock dividend payout ratio 17.28 % 18.67 % 18.84 % RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) For the six months ended June 30, 2022 2021 Per share data (common stock) Earnings Basic $ 1.56 $ 1.32 Diluted $ 1.54 $ 1.30 Dividends declared $ 0.28 $ 0.25 Book value $ 24.56 $ 22.86 Tangible book value $ 20.55 $ 19.04 Weighted average shares outstanding Basic 19,221,155 19,453,889 Diluted 19,582,902 19,844,077 Shares outstanding at period end 18,881,829 19,349,802 Performance ratios Return on average assets, annualized 1.49 % 1.43 % Return on average shareholders' equity, annualized 12.95 % 11.89 % Return on average tangible common equity, annualized 15.40 % 14.31 % Noninterest income to average assets, annualized 0.32 % 0.56 % Noninterest expense to average assets, annualized 1.67 % 1.69 % Yield on average earning assets 4.32 % 4.23 % Cost of average deposits 0.29 % 0.48 % Cost of average interest-bearing deposits 0.46 % 0.66 % Cost of average interest-bearing liabilities 0.88 % 1.02 % Accretion on loans to average earning assets 0.02 % 0.04 % Net interest spread 3.44 % 3.21 % Net interest margin 3.77 % 3.52 % Efficiency ratio 43.20 % 43.78 % Common stock dividend payout ratio 17.95 % 18.94 % RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) As of June 30, March 31, June 30, 2022 2022 2021 Loan to deposit ratio 100.61 % 94.89 % 88.25 % Core deposits / total deposits 82.16 % 82.54 % 80.04 % Net non-core funding dependence ratio -0.44 % -0.28 % 0.87 % Credit Quality Data: Loans 30-89 days past due $ 8,346 $ 17,635 $ 5,449 Loans 30-89 days past due to total loans 0.27 % 0.59 % 0.20 % Nonperforming loans $ 13,937 $ 20,691 $ 19,243 Nonperforming loans to total loans 0.46 % 0.69 % 0.71 % Nonperforming assets $ 14,230 $ 20,984 $ 19,536 Nonperforming assets to total assets 0.36 % 0.52 % 0.50 % Allowance for loan losses to total loans 1.12 % 1.11 % 1.16 % Allowance for loan losses to nonperforming loans 245.06 % 160.90 % 162.93 % Net charge-offs to average loans (for the quarter-to-date period) 0.01 % 0.00 % 0.01 % Regulatory and other capital ratios—Company Tangible common equity to tangible assets 9.98 % 9.87 % 9.65 % Tier 1 leverage ratio 10.96 % 9.90 % 10.20 % Tier 1 common capital to risk-weighted assets 14.84 % 14.12 % 14.76 % Tier 1 capital to risk-weighted assets 15.38 % 14.63 % 15.33 % Total capital to risk-weighted assets 22.98 % 21.96 % 23.48 % Regulatory capital ratios—Bank only Tier 1 leverage ratio 13.90 % 12.29 % 12.34 % Tier 1 common capital to risk-weighted assets 19.55 % 18.15 % 18.58 % Tier 1 capital to risk-weighted assets 19.55 % 18.15 % 18.58 % Total capital to risk-weighted assets 20.80 % 19.37 % 19.83 % RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) 2nd Quarter 1st Quarter 4th Quarter 3rd Quarter 2nd Quarter Quarterly Consolidated Statements of Earnings 2022 2022 2021 2021 2021 Interest income Loans, including fees $ 40,157 $ 37,886 $ 36,783 $ 35,601 $ 34,669 Investment securities and other 2,181 1,680 1,661 1,507 1,302 Total interest income 42,338 39,566 38,444 37,108 35,971 Interest expense Deposits 2,350 2,292 2,431 2,745 3,118 Interest on subordinated debentures and other 2,379 2,348 2,343 2,342 2,356 Other borrowings 519 435 445 445 440 Total interest expense 5,248 5,075 5,219 5,532 5,914 Net interest income before provision for loan losses 37,090 34,491 33,225 31,576 30,057 Provision for loan losses 915 366 635 1,196 628 Net interest income after provision for loan losses 36,175 34,125 32,590 30,380 29,429 Noninterest income 3,422 2,944 3,156 5,524 4,171 Noninterest expense 17,612 16,061 13,300 14,420 14,680 Earnings before income taxes 21,985 21,008 22,446 21,484 18,920 Income taxes 6,508 6,391 6,740 6,120 5,540 Net income $ 15,477 $ 14,617 $ 15,706 $ 15,364 $ 13,380 Net income per common share - basic $ 0.81 $ 0.75 $ 0.81 $ 0.79 $ 0.69 Net income per common share - diluted $ 0.80 $ 0.74 $ 0.79 $ 0.77 $ 0.67 Cash dividends declared per common share $ 0.14 $ 0.14 $ 0.13 $ 0.13 $ 0.13 Cash dividends declared on common shares $ 2,687 $ 2,724 $ 2,537 $ 2,516 $ 2,540 Yield on average assets, annualized 1.60 % 1.39 % 1.52 % 1.54 % 1.39 % Yield on average earning assets 4.66 % 4.00 % 3.97 % 3.97 % 3.99 % Cost of average deposits 0.31 % 0.27 % 0.30 % 0.35 % 0.41 % Cost of average interest-bearing deposits 0.49 % 0.44 % 0.47 % 0.51 % 0.59 % Cost of average interest-bearing liabilities 0.91 % 0.84 % 0.86 % 0.89 % 0.97 % Accretion on loans to average earning assets 0.01 % 0.02 % 0.02 % 0.03 % 0.02 % Net interest margin 4.08 % 3.49 % 3.43 % 3.38 % 3.33 % RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited, except for December 31, 2021) (Dollars in thousands, except per share amounts) Loan Portfolio Detail As ofJune 30, 2022 As ofMarch 31, 2022 As ofDecember 31, 2021 As ofSeptember 30, 2021 As ofJune 30, 2021 (dollars in thousands) $ % $ % $ % $ % $ % Loans: Commercial and industrial $ 238,045 7.8 % $ 280,825 9.3 % $ 268,709 9.2 % $ 276,387 9.7 % $ 277,080 10.2 % SBA 59,303 1.9 % 67,688 2.3 % 76,136 2.6 % 88,784 3.1 % 98,572 3.6 % Construction and land development 356,772 11.7 % 346,766 11.5 % 303,144 10.3 % 271,764 9.6 % 236,965 8.7 % Commercial real estate (1) 1,160,350 38.1 % 1,217,985 40.5 % 1,247,999 42.6 % 1,205,630 42.4 % 1,102,467 40.7 % Single-family residential mortgages 1,205,732 39.6 % 1,064,581 35.4 % 1,004,576 34.3 % 974,780 34.3 % 984,311 36.3 % Other loans 25,744 0.9 % 28,639 1.0 % 30,786 1.0 % 23,009 0.9 % 9,811 0.5 % Total loans (2) $ 3,045,946 100.0 % $ 3,006,484 100.0 % $ 2,931,350 100.0 % $ 2,840,354 100.0 % $ 2,709,206 100.0 % Allowance for loan losses (34,154 ) (33,292 ) (32,912 ) (32,231 ) (31,352 ) Total loans, net $ 3,011,792 $ 2,973,192 $ 2,898,438 $ 2,808,123 $ 2,677,854 (1) Includes non-farm and non-residential loans, multi-family residential loans and non-owner occupied single family residential loans. (2) Net of discounts and deferred fees and costs. Three Months Ended Six Months Ended Change in Allowance for Loan Losses June 30, June 30, (dollars in thousands) 2022 2021 2022 2021 Beginning balance $ 33,292 $ 30,795 $ 32,912 $ 29,337 Additions to the allowance charged to expense 915 628 1,282 2,128 Net recoveries (charge-offs) on loans (53 ) (71 ) (40 ) (113 ) Ending balance $ 34,154 $ 31,352 $ 34,154 $ 31,352 Tangible Book Value Reconciliations (non-GAAP) The tangible book value per share is a non-GAAP disclosure. The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company’s performance. The following is a reconciliation of tangible book value to the Company shareholders’ equity computed in accordance with GAAP, as well as a calculation of tangible book value per share as of June 30, 2022 and 2021, and March 31, 2022. (dollars in thousands, except per share data) June 30, 2022 March 31, 2022 June 30, 2021 Tangible common equity: Total shareholders' equity $ 463,707 $ 464,825 $ 442,325 Adjustments Goodwill (71,498 ) (71,498 ) (69,243 ) Core deposit intangible (4,248 ) (4,525 ) (4,608 ) Tangible common equity $ 387,961 $ 388,802 $ 368,474 Tangible assets: Total assets-GAAP $ 3,964,271 $ 4,013,569 $ 3,890,638 Adjustments Goodwill (71,498 ) (71,498 ) (69,243 ) Core deposit intangible (4,248 ) (4,525 ) (4,608 ) Tangible assets $ 3,888,525 $ 3,937,546 $ 3,816,787 Common shares outstanding $ 18,881,829 19,247,970 19,349,802 Tangible common equity to tangible assets ratio 9.98 % 9.87 % 9.65 % Book value per share $ 24.56 $ 24.15 $ 22.86 Tangible book value per share $ 20.55 $ 20.20 $ 19.04 View source version on businesswire.com: https://www.businesswire.com/news/home/20220725005787/en/ContactsDavid Morris Interim President and CEO CFO (714) 670-2488 Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. 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RBB Bancorp Reports Second Quarter Earnings for 2022 By: RBB Bancorp via Business Wire July 25, 2022 at 16:05 PM EDT Conference Call and Webcast Scheduled for Tuesday, July 26, 2022 at 11:00 a.m. Pacific Time/2:00 p.m. Eastern Time Second Quarter 2022 Highlights Net income of $15.5 million, or $0.80 diluted earnings per share, increased $860,000, or 5.9%, from the prior quarter and increased $2.1 million, or 15.7%, from the second quarter of 2021 Loans grew by $35.9 million, or 4.8% annualized, from the end of the prior quarter Declared $0.14 per share quarterly dividend RBB Bancorp (NASDAQ:RBB) and its subsidiaries, Royal Business Bank (“the Bank”) and RBB Asset Management Company (“RAM”), collectively referred to herein as “the Company,” announced financial results for the quarter ended June 30, 2022. The Company reported net income of $15.5 million, or $0.80 diluted earnings per share, for the three months ended June 30, 2022, compared to net income of $14.6 million, or $0.74 diluted earnings per share, and $13.4 million, or $ 0.67 diluted earnings per share, for the three months ended March 31, 2022 and June 30, 2021, respectively. “Our performance in the second quarter demonstrated the strength of our differentiated business model as the Bank delivered strong earnings, improving margins, and loan growth,” said David Morris, Interim President and CEO of RBB Bancorp. “Expenses were higher than expected due to the ongoing costs related to the Board of Directors investigation, which we expect to wind down in the third quarter. We were pleased to announce several new hires and re-hires during the quarter and look forward to working with our new colleagues to build shareholder value.” "The excellent second quarter results demonstrate the value of Royal Business Bank," said Dr. James Kao, Chairman of RBB Bancorp. “The Bank is well-positioned to continue to generate attractive returns and shareholder value.” Key Performance Ratios Net income of $15.5 million for the second quarter of 2022 produced an annualized return on average assets ("ROA") of 1.60%, an annualized return on average tangible common shareholders' equity ("ROTCE") of 15.89%, and an annualized return on average shareholders' equity ("ROE") of 13.30%. This compares to an annualized ROA of 1.39%, an annualized ROTCE of 14.91%, and an annualized ROE of 12.59% for the first quarter of 2022. The efficiency ratio for the second quarter of 2022 was 43.47%, compared to 42.90% for the prior quarter. Net Interest Income and Net Interest Margin Net interest income, before provision for loan losses, was $37.1 million for the second quarter of 2022, compared to $34.5 million for the first quarter of 2022. The $2.6 million increase was primarily attributable to 1.25% increase in interest rate by Federal Reserve Bank in the second quarter of 2022. Accretion of purchase discounts from prior acquisitions contributed $75,000 to net interest income in the second quarter of 2022, compared to $246,000 in the first quarter of 2022. Compared to the second quarter of 2021, net interest income, before provision for loan losses, increased $7.0 million from $30.1 million. The increase was primarily attributable to a $289.3 million increase in average loans and a 1.25% increase in interest rate by the Federal Reserve Bank in the second quarter of 2022. The increases in average earning assets were primarily due to increased loan originations. Net interest margin was 4.08% for the second quarter of 2022, an increase of 59 basis points from 3.49% in the first quarter of 2022. Loan discount accretion contributed 1 basis point to the net interest margin in the second quarter of 2022, compared to 2 basis points in the first quarter of 2022. Noninterest Income Noninterest income was $3.4 million for the second quarter of 2022, an increase of $478,000 from $2.9 million in the first quarter of 2022. The increase was primarily driven by a $757,000 increase in gain on sale of corporate real estate, a $272,000 decrease in loss on derivatives and a $94,000 increase in recoveries on purchased loans, partially offset by an $830,000 decrease in gain on sale of loans during the quarter. The Company sold $12.6 million in FNMA qualified mortgage loans for a net gain of $284,000 during the second quarter of 2022 compared to $26.9 million in FNMA qualified mortgage loans sold for a net gain of $711,000 during the first quarter of 2022. The Company sold $1.1 million in SBA loans during the second quarter of 2022 for a net gain of $60,000, compared to $8.3 million SBA loans sold for a net gain of $463,000 during the first quarter of 2022. Compared to the second quarter of 2021, noninterest income decreased by $749,000 from $4.2 million. The decrease was primarily attributable to a $2.2 million decrease in gain on sale of loans, partially offset by a $757,000 increase in gain on corporate real estate, a $354,000 increase in loan servicing fees, an $113,000 increase in income from bank owned life insurance and a $93,000 increase in recoveries on purchased loans. Noninterest Expense Noninterest expense for the second quarter of 2022 was $17.6 million, compared to $16.1 million for the first quarter of 2022. The $1.6 million increase was primarily attributable to a $1.2 million increase in legal and professional expenses due to a Board of Director special investigation and a $259,000 increase in salaries and employee benefits expense due to additional new hires and salary adjustments to reflect economic inflation. Noninterest expense increased from $14.7 million in the second quarter of 2021. The $2.9 million increase was primarily due to a $1.7 million increase in legal and professional expenses due to a Board of Director special investigation, an $886,000 increase in salaries and employee benefits expenses and a $270,000 increase in business promotion and CRA donation expenses. Income Taxes The effective tax rate was 29.6% for the second quarter of 2022, 30.4% for the first quarter of 2022, and 29.3% for the second quarter of 2021. The Company recognized a tax benefit from stock option exercises of $279,000, $23,000 and $68,000 for the second quarter of 2022, the first quarter of 2022, and the second quarter of 2021, respectively. Loan and Securities Portfolio Loans held for investment, net of deferred fees and discounts, totaled $3.05 billion as of June 30, 2022, an increase of $39.5 million from March 31, 2022, and an increase of $336.7 million from June 30, 2021. The increase from the prior quarter was primarily due to a $141.2 million increase in single-family residential mortgage loans and a $10.0 million increase in construction & land development loans, partially offset by a $57.6 million decrease in commercial real estate loans and a $42.8 million decrease in commercial and industrial loans. The increase from June 30, 2021 was primarily due to a $221.4 million increase in single-family residential mortgages and a $119.8 million increase in construction & land development loans. During the second quarter of 2022, single-family residential mortgage production was $216.9 million while net payoffs and paydowns were $66.8 million. During the first quarter of 2022, single-family residential mortgage production was $132.6 million while payoffs and paydowns were $48.1 million. There were no mortgage loans held for sale as of June 30, 2022 compared to $3.6 million as of March 31, 2022 and $9.2 million as of June 30, 2021. The Company originated approximately $1.2 million in FNMA mortgage loans for sale for the second quarter of 2022, compared with $23.4 million during the prior quarter. In the second quarter of 2022, SBA loan production was $1.4 million and total SBA loan sales were $1.1 million compared to SBA loan production of $11.9 million and total SBA loan sales of $8.3 million in the first quarter of 2022. As of June 30, 2022, the Bank’s total Available-for-Sale securities maturing in over 12 months were $249.2 million, and the Bank recorded an unrealized loss of $20.2 million under the Accumulated Other Comprehensive Income (AOCI) since January 1, 2022. Deposits Deposits were $3.0 billion at June 30, 2022, which was a decrease of $140.7 million compared to March 31, 2022. During the second quarter of 2022, noninterest-bearing deposits decreased by $114.7 million, interest-bearing non-maturity deposits decreased by $16.7 million, and time deposits decreased by $9.3 million. As of June 30, 2022, there were $50.0 million in brokered CDs, as compared to no brokered CDs as of March 31, 2022 and $17.4 million brokered CDs as of June 30, 2021. Compared to June 30, 2021, total deposits decreased by $42.4 million primarily due to a $157.0 million decrease in time deposits, partially offset by a $105.0 million increase in noninterest-bearing demand deposits. Asset Quality Nonperforming assets totaled $14.2 million, or 0.36% of total assets at June 30, 2022, compared to $21.0 million, or 0.52% of total assets at March 31, 2022. The decrease in nonperforming assets was due to the pay-off of certain nonperforming loans in the second quarter. Nonperforming assets consist of other real estate owned, loans modified under troubled debt restructurings (“TDR”), non-accrual loans, and loans past due 90 days or more and still accruing interest. In the second quarter of 2022, there were $53,000 in net charge-offs, compared to net recoveries of $14,000 in the first quarter of 2022 and net charge-offs of $71,000 in the second quarter of 2021. The Company recorded a provision for credit losses of $915,000 for the second quarter of 2022 which was primarily attributable to loan growth and was an increase from $366,000 in the prior quarter. Allowance for loan losses continue to include $599,000 of reserves taken as a precaution against COVID-19 losses in 2020 and 2021. The allowance for loan losses totaled $34.2 million, or 1.12% of loans held for investment at June 30, 2022, compared with $33.3 million, or 1.11%, of total loans at March 31, 2022. During the second quarter of 2022, the Company repurchased 525,754 common shares at a weighted average price of $21.10. Corporate Overview RBB Bancorp is a community-based financial holding company headquartered in Los Angeles, California. As of June 30, 2022, the company had total assets of $4.0 billion. Its wholly-owned subsidiary, the Bank is a full service commercial bank, which provides business banking services to the Chinese-American communities in Los Angeles County, Orange County, and Ventura County in California, in Las Vegas, Nevada, in Brooklyn, Queens, and Manhattan in New York, in Edison, New Jersey, in the Chicago neighborhoods of Chinatown and Bridgeport, Illinois, and on Oahu, Hawaii. Bank services include remote deposit, E-banking, mobile banking, commercial and investor real estate loans, business loans and lines of credit, commercial and industrial loans, SBA 7A and 504 loans, 1-4 single family residential loans, automobile lending, trade finance, a full range of depository account products and wealth management services. The Bank has nine branches in Los Angeles County, two branches in Ventura County, one branch in Orange County, California, one branch in Las Vegas, Nevada, three branches and one loan operation center in Brooklyn, three branches in Queens, one branch in Manhattan in New York, one branch in Edison, New Jersey, two branches in Chicago, Illinois, and one branch in Honolulu, Hawaii. The Company's administrative and lending center is located at 1055 Wilshire Blvd., Los Angeles, California 90017, and its finance and operations center is located at 7025 Orangethorpe Ave., Buena Park, California 90621. The Company's website address is www.royalbusinessbankusa.com. Conference Call Management will hold a conference call at 11:00 a.m. Pacific time/2:00 p.m. Eastern time tomorrow, July 26, 2022, to discuss the Company’s second quarter 2022 financial results. To listen to the conference call, please dial 1-866-459-5346 or 1-203-518-9544, conference ID RBBQ222. A replay of the call will be made available at 1-877-274-8334 or 1-402-220-2326 (no passcode required) approximately one hour after the conclusion of the call and will remain available through August 2, 2022. The conference call will also be simultaneously webcast over the Internet; please visit our Royal Business Bank website at www.royalbusinessbankusa.com and click on the “Investors” tab to access the call from the site. This webcast will be recorded and available for replay on our website approximately two hours after the conclusion of the conference call. Disclosure This press release contains certain non-GAAP financial disclosures for tangible common equity and tangible assets and adjusted earnings. The Company uses certain non- GAAP financial measures to provide meaningful supplemental information regarding the Company’s operational performance and to enhance investors’ overall understanding of such financial performance. Please refer to the tables at the end of this release for a presentation of performance ratios in accordance with GAAP and a reconciliation of the non-GAAP financial measures to the GAAP financial measures. Safe Harbor Certain matters set forth herein (including the exhibits hereto) constitute forward-looking statements relating to the Company’s current business plans and expectations and our future financial position and operating results. These forward-looking statements are subject to risks and uncertainties that could cause actual results, performance and/or achievements to differ materially from those projected. These risks and uncertainties include, but are not limited to, local, regional, national and international economic and market conditions and events and the impact they may have on us, our customers and our assets and liabilities; our ability to attract deposits and other sources of funding or liquidity; supply and demand for real estate and periodic deterioration in real estate prices and/or values in California or other states where we lend, including both residential and commercial real estate; a prolonged slowdown or decline in real estate construction, sales or leasing activities; changes in the financial performance and/or condition of our borrowers, depositors or key vendors or counterparties; changes in our levels of delinquent loans, nonperforming assets, allowance for loan losses and charge-offs; expectations regarding the impact of the COVID-19 pandemic; the costs or effects of acquisitions or dispositions we may make, whether we are able to obtain any required governmental or shareholder approvals in connection with any such acquisitions or dispositions, and/or our ability to realize the contemplated financial or business benefits associated with any such acquisitions or dispositions; the effect of changes in laws, regulations and applicable judicial decisions (including laws, regulations and judicial decisions concerning financial reforms, taxes, banking capital levels, consumer, commercial or secured lending, securities and securities trading and hedging, compliance, employment, executive compensation, insurance, vendor management and information security) with which we and our subsidiaries must comply or believe we should comply; changes in estimates of future reserve requirements and minimum capital requirements based upon the periodic review thereof under relevant regulatory and accounting requirements, including changes in the Basel Committee framework establishing capital standards for credit, operations and market risk; inflation, interest rate, securities market and monetary fluctuations; changes in government interest rates or monetary policies; changes in the amount and availability of deposit insurance; cyber-security threats, including loss of system functionality or theft or loss of Company or customer data or money; political instability; acts of war or terrorism, or natural disasters, such as earthquakes, drought, or the effects of pandemic diseases; the timely development and acceptance of new banking products and services and the perceived overall value of these products and services by our customers and potential customers; the Company’s relationships with and reliance upon vendors with respect to the operation of certain of the Company’s key internal and external systems and applications; changes in commercial or consumer spending, borrowing and savings preferences or behaviors; technological changes and the expanding use of technology in banking (including the adoption of mobile banking and funds transfer applications); the ability to retain and increase market share, retain and grow customers and control expenses; changes in the competitive and regulatory environment among financial and bank holding companies, banks and other financial service providers; volatility in the credit and equity markets and its effect on the general economy or local or regional business conditions; fluctuations in the price of the Company’s common stock or other securities; and the resulting impact on the Company’s ability to raise capital or make acquisitions, the effect of changes in accounting policies and practices, as may be adopted from time-to-time by our regulatory agencies, as well as by the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard-setters, including ASU 2016-13 (Topic 326), “Measurement of Credit Losses on Financial Instruments”, commonly referenced as the Current Expected Credit Loss (“CECL”) model, which will change how we estimate credit losses and may increase the required level of our allowance for credit losses after adoption; changes in our organization, management, compensation and benefit plans, and our ability to retain or expand our workforce, management team and/or our board of directors; the costs and effects of legal, compliance and regulatory actions, changes and developments, including the initiation and resolution of legal proceedings (such as securities, consumer or employee class action litigation), regulatory or other governmental inquiries or investigations, and/or the results of regulatory examinations or reviews; our ongoing relations with our various federal and state regulators, including the SEC, FDIC, FRB and California DFPI (formerly DBO); our success at managing the risks involved in the foregoing items and all other factors set forth in the Company’s public reports, including its Annual Report as filed under Form 10-K/A and Form 10-K for the year ended December 31, 2021, and particularly the discussion of risk factors within that document. The Company does not undertake, and specifically disclaims any obligation, to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements except as required by law. Any statements about future operating results, such as those concerning accretion and dilution to the Company’s earnings or shareholders, are for illustrative purposes only, are not forecasts, and actual results may differ. RBB BANCORP AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited, except for December 31, 2021) (Dollars in thousands) June 30, March 31, December 31, September 30, June 30, 2022 2022 2021 2021 2021 Assets Cash and due from banks $ 224,736 $ 149,767 $ 501,372 $ 206,927 $ 493,653 Federal funds sold and other cash equivalents 100,000 200,000 193,000 170,000 110,000 Total cash and cash equivalents 324,736 349,767 694,372 376,927 603,653 Interest-bearing deposits in other financial institutions 600 600 600 600 600 Investment securities available for sale 358,135 420,448 368,260 345,000 339,568 Investment securities held to maturity 5,741 6,246 6,252 6,258 6,664 Mortgage loans held for sale — 3,572 5,957 15,188 9,246 Loans held for investment 3,045,946 3,006,484 2,931,350 2,840,354 2,709,206 Allowance for loan losses (34,154 ) (33,292 ) (32,912 ) (32,231 ) (31,352 ) Net loans held for investment 3,011,792 2,973,192 2,898,438 2,808,123 2,677,854 Premises and equipment, net 27,104 27,455 27,199 27,157 27,039 Federal Home Loan Bank (FHLB) stock 15,000 15,000 15,000 15,000 15,000 Cash surrender value of life insurance 56,642 56,313 55,988 55,656 55,325 Goodwill 71,498 71,498 69,243 69,243 69,243 Servicing assets 10,456 11,048 11,517 12,141 12,558 Core deposit intangibles 4,248 4,525 4,075 4,327 4,608 Right-of-use assets- operating leases 21,166 22,451 22,454 23,735 25,050 Accrued interest and other assets 57,153 51,454 48,839 42,452 44,230 Total assets $ 3,964,271 $ 4,013,569 $ 4,228,194 $ 3,801,807 $ 3,890,638 Liabilities and shareholders' equity Deposits: Noninterest-bearing demand $ 1,045,009 $ 1,159,703 $ 1,291,484 $ 824,771 $ 940,041 Savings, NOW and money market accounts 868,307 885,050 927,609 931,517 858,597 Time deposits, less than $250,000 574,050 570,274 587,940 614,146 658,393 Time deposits, greater than or equal to $250,000 540,199 553,226 578,499 597,379 612,894 Total deposits 3,027,565 3,168,253 3,385,532 2,967,813 3,069,925 Reserve for unfunded commitments 1,070 1,186 1,203 1,304 1,216 FHLB advances 250,000 150,000 150,000 150,000 150,000 Long-term debt, net of debt issuance costs 173,296 173,152 173,007 172,862 172,718 Subordinated debentures 14,611 14,556 14,502 14,447 14,393 Lease liabilities - operating leases 22,057 23,314 23,282 24,524 25,798 Accrued interest and other liabilities 11,965 18,283 13,985 14,833 14,263 Total liabilities 3,500,564 3,548,744 3,761,511 3,345,783 3,448,313 Shareholders' equity: Shareholder's equity 479,382 475,077 468,267 456,490 442,086 Non-controlling interest 72 72 72 72 72 Accumulated other comprehensive (loss) income - Net of tax (15,747 ) (10,324 ) (1,656 ) (538 ) 167 Total shareholders' equity 463,707 464,825 466,683 456,024 442,325 Total liabilities and shareholders’ equity $ 3,964,271 $ 4,013,569 $ 4,228,194 $ 3,801,807 $ 3,890,638 RBB BANCORP AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Dollars in thousands, except per share amounts) For the Three Months Ended June 30, 2022 March 31, 2022 June 30, 2021 Interest and dividend income: Interest and fees on loans $ 40,157 $ 37,886 $ 34,669 Interest on interest-bearing deposits 111 171 125 Interest on investment securities 1,419 1,007 794 Dividend income on FHLB stock 222 227 225 Interest on federal funds sold and other 429 275 158 Total interest income 42,338 39,566 35,971 Interest expense: Interest on savings deposits, NOW and money market accounts 844 718 708 Interest on time deposits 1,506 1,574 2,410 Interest on subordinated debentures and long term debt 2,379 2,348 2,356 Interest on other borrowed funds 519 435 440 Total interest expense 5,248 5,075 5,914 Net interest income before provision for loan losses 37,090 34,491 30,057 Provision for loan losses 915 366 628 Net interest income after provision for loan losses 36,175 34,125 29,429 Noninterest income: Service charges, fees and other 1,382 1,241 1,332 Gain on sale of loans 344 1,174 2,572 Loan servicing fees, net of amortization 472 432 118 Recoveries on loans acquired in business combinations 98 5 5 Unrealized (loss) on equity investments — — (35 ) Gain (loss) on derivatives 39 (233 ) (38 ) Increase in cash surrender value of life insurance 330 325 217 Gain on sale of fixed assets 757 — — Total noninterest income 3,422 2,944 4,171 Noninterest expense: Salaries and employee benefits 9,628 9,369 8,742 Occupancy and equipment expenses 2,174 2,206 2,135 Data processing 1,293 1,258 1,231 Legal and professional 2,254 1,006 536 Office expenses 358 293 272 Marketing and business promotion 501 307 231 Insurance and regulatory assessments 478 441 354 Core deposit premium 277 279 287 OREO expenses 5 8 4 Merger expenses 23 37 17 Other expenses 621 857 871 Total noninterest expense 17,612 16,061 14,680 Income before income taxes 21,985 21,008 18,920 Income tax expense 6,508 6,391 5,540 Net income $ 15,477 $ 14,617 $ 13,380 Net income per share Basic $ 0.81 $ 0.75 $ 0.69 Diluted $ 0.80 $ 0.74 $ 0.67 Cash Dividends declared per common share $ 0.14 $ 0.14 $ 0.13 Weighted-average common shares outstanding Basic 19,066,621 19,377,407 19,432,204 Diluted 19,368,860 19,799,323 19,874,969 RBB BANCORP AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Dollars in thousands, except per share amounts) For the Six Months Ended June 30, 2022 June 30, 2021 Interest and dividend income: Interest and fees on loans $ 78,043 $ 69,185 Interest on interest-earning deposits 282 173 Interest on investment securities 2,426 1,421 Dividend income on FHLB stock 449 417 Interest on federal funds sold and other 704 315 Total interest income 81,904 71,511 Interest expense: Interest on savings deposits, NOW and money market accounts 1,562 1,406 Interest on time deposits 3,080 5,374 Interest on subordinated debentures and long term debt 4,727 4,314 Interest on other borrowed funds 954 875 Total interest expense 10,323 11,969 Net interest income 71,581 59,542 Provision for loan losses 1,282 2,128 Net interest income after provision for loans losses 70,299 57,414 Noninterest income: Service charges, fees and other (1) 2,622 2,800 Gain on sale of loans 1,518 6,413 Loan servicing fees, net of amortization 904 364 Recoveries on loans acquired in business combinations 103 10 Unrealized (loss) gain on equity investments — (55 ) (Loss) gain on derivatives (194 ) 129 Increase in cash surrender value of life insurance 654 404 Gain on sale of fixed assets 757 — Total noninterest income 6,364 10,065 Noninterest expense: Salaries and employee benefits 18,997 17,984 Occupancy and equipment expenses 4,380 4,377 Data processing 2,551 2,671 Legal and professional 3,260 1,341 Office expenses 651 527 Marketing and business promotion 808 415 Insurance and regulatory assessments 919 702 Core deposit premium 556 588 OREO expenses 13 9 Merger expenses 60 59 Other expenses 1,475 1,799 Total noninterest expense 33,670 30,472 Income before income taxes 42,993 37,007 Income tax expense 12,899 11,171 Net income $ 30,094 $ 25,836 Net income per share Basic $ 1.56 $ 1.32 Diluted $ 1.54 $ 1.30 Cash Dividends declared per common share $ 0.28 $ 0.25 Weighted-average common shares outstanding Basic 19,221,155 19,453,889 Diluted 19,582,902 19,844,077 RBB BANCORP AND SUBSIDIARIES AVERAGE BALANCE SHEET AND NET INTEREST INCOME (Unaudited) (Dollars in thousands, except per share amounts) For the three months ended June 30, 2022 March 31, 2022 June 30, 2021 Average Interest Yield / Average Interest Yield / Average Interest Yield / (tax-equivalent basis, dollars in thousands) Balance & Fees Rate Balance & Fees Rate Balance & Fees Rate Earning assets: Federal funds sold, cash equivalents & other (1) $ 249,738 $ 762 1.22 % $ 628,634 $ 673 0.43 % $ 582,554 $ 508 0.35 % Securities Available for sale (2) 399,321 1,393 1.40 % 392,858 974 1.01 % 328,004 751 0.92 % Held to maturity (2) 5,744 50 3.49 % 6,250 57 3.70 % 6,667 60 3.61 % Mortgage loans held for sale 892 13 5.85 % 3,652 43 4.78 % 21,033 173 3.30 % Loans held for investment: (3) Real estate 2,663,753 35,207 5.30 % 2,602,382 33,095 5.16 % 2,292,145 29,794 5.21 % Commercial 325,861 4,937 6.08 % 380,978 4,748 5.05 % 388,049 4,702 4.86 % Total loans 2,989,614 40,144 5.39 % 2,983,360 37,843 5.14 % 2,680,194 34,496 5.16 % Total earning assets 3,645,309 $ 42,362 4.66 % 4,014,754 $ 39,590 4.00 % 3,618,452 $ 35,988 3.99 % Noninterest-earning assets 243,227 241,235 230,049 Total assets $ 3,888,536 $ 4,255,989 $ 3,848,501 Interest-bearing liabilities NOW $ 75,637 $ 50 0.27 % $ 75,399 $ 43 0.23 % $ 66,777 $ 45 0.27 % Money Market 631,807 759 0.48 % 720,197 643 0.36 % 640,026 628 0.39 % Saving deposits 148,400 35 0.09 % 145,327 32 0.09 % 140,418 35 0.10 % Time deposits, less than $250,000 553,282 724 0.52 % 600,563 754 0.51 % 657,494 1,163 0.71 % Time deposits, $250,000 and over 526,164 782 0.60 % 570,210 820 0.58 % 604,429 1,247 0.83 % Total interest-bearing deposits 1,935,290 2,350 0.49 % 2,111,696 2,292 0.44 % 2,109,144 3,118 0.59 % FHLB advances 182,749 519 1.14 % 150,000 435 1.18 % 150,000 440 1.18 % Long-term debt 173,201 2,195 5.08 % 173,058 2,194 5.14 % 172,622 2,206 5.13 % Subordinated debentures 14,575 184 5.06 % 14,521 154 4.30 % 14,357 150 4.19 % Total interest-bearing liabilities 2,305,815 5,248 0.91 % 2,449,275 5,075 0.84 % 2,446,123 5,914 0.97 % Noninterest-bearing liabilities Noninterest-bearing deposits 1,082,793 1,301,497 913,442 Other noninterest-bearing liabilities 33,325 34,319 46,549 Total noninterest-bearing liabilities 1,116,118 1,335,816 959,991 Shareholders' equity 466,603 470,898 442,387 Total liabilities and shareholders' equity $ 3,888,536 $ 4,255,989 $ 3,848,501 Net interest income / interest rate spreads $ 37,114 3.75 % $ 34,515 3.16 % $ 30,074 3.02 % Net interest margin 4.08 % 3.49 % 3.33 % (1) Includes income and average balances for FHLB stock, term federal funds, interest-bearing time deposits and other miscellaneous interest-bearing assets. (2) Interest income and average rates for tax-exempt loans and securities are presented on a tax-equivalent basis. (3) Average loan balances include nonaccrual loans and loans held for sale. Interest income on loans includes - amortization of deferred loan fees, net of deferred loan costs. RBB BANCORP AND SUBSIDIARIES AVERAGE BALANCE SHEET AND NET INTEREST INCOME (Unaudited) (Dollars in thousands, except per share amounts) For the six months ended June 30, 2022 June 30, 2021 Average Interest Yield / Average Interest Yield / (tax-equivalent basis, dollars in thousands) Balance & Fees Rate Balance & Fees Rate Earning assets: Federal funds sold, cash equivalents & other (1) $ 438,140 $ 1,435 0.66 % $ 399,907 $ 905 0.46 % Securities Available for sale (2) 396,107 2,367 1.21 % 284,129 1,323 0.94 % Held to maturity (2) 5,996 107 3.60 % 6,832 126 3.72 % Mortgage loans held for sale 2,265 56 4.99 % 37,436 584 3.15 % Loans held for investment: (3) Real estate 2,633,237 68,302 5.23 % 2,299,746 59,315 5.20 % Commercial 353,267 9,685 5.53 % 386,256 9,286 4.85 % Total loans 2,986,504 77,987 5.27 % 2,686,002 68,601 5.15 % Total earning assets 3,829,012 $ 81,952 4.32 % 3,414,306 $ 71,539 4.23 % Noninterest-earning assets 242,235 229,032 Total assets $ 4,071,247 $ 3,643,338 Interest-bearing liabilities NOW $ 75,519 $ 94 0.25 % $ 65,690 $ 88 0.27 % Money Market 675,758 1,401 0.42 % 609,854 1,251 0.41 % Saving deposits 146,872 67 0.09 % 135,810 67 0.10 % Time deposits, less than $250,000 576,792 1,478 0.52 % 660,246 2,659 0.81 % Time deposits, $250,000 and over 548,065 1,602 0.59 % 599,234 2,716 0.91 % Total interest-bearing deposits 2,023,006 4,642 0.46 % 2,070,834 6,781 0.66 % FHLB advances 166,465 954 1.16 % 150,000 875 1.18 % Long-term debt 173,129 4,388 5.11 % 142,349 4,015 5.69 % Subordinated debentures 14,548 339 4.70 % 14,330 298 4.19 % Total interest-bearing liabilities 2,377,148 $ 10,323 0.88 % 2,377,513 $ 11,969 1.02 % Noninterest-bearing liabilities Noninterest-bearing deposits 1,191,540 784,276 Other noninterest-bearing liabilities 33,820 43,352 Total noninterest-bearing liabilities 1,225,360 827,628 Shareholders' equity 468,739 438,197 Total liabilities and shareholders' equity $ 4,071,247 $ 3,643,338 Net interest income / interest rate spreads $ 71,629 3.44 % $ 59,570 3.21 % Net interest margin 3.77 % 3.52 % (1) Includes income and average balances for FHLB stock, term federal funds, interest-bearing time deposits and other miscellaneous interest-bearing assets. (2) Interest income and average rates for tax-exempt loans and securities are presented on a tax-equivalent basis. (3) Average loan balances include nonaccrual loans and loans held for sale. Interest income on loans includes - amortization of deferred loan fees, net of deferred loan costs. RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) For the three months ended June 30, March 31, June 30, 2022 2022 2021 Per share data (common stock) Earnings Basic $ 0.81 $ 0.75 $ 0.69 Diluted $ 0.80 $ 0.74 $ 0.67 Dividends declared $ 0.14 $ 0.14 $ 0.13 Book value $ 24.56 $ 24.15 $ 22.86 Tangible book value $ 20.55 $ 20.20 $ 19.04 Weighted average shares outstanding Basic 19,066,621 19,377,407 19,432,204 Diluted 19,368,860 19,799,323 19,874,969 Shares outstanding at period end 18,881,829 19,247,970 19,349,802 Performance ratios Return on average assets, annualized 1.60 % 1.39 % 1.39 % Return on average shareholders' equity, annualized 13.30 % 12.59 % 12.13 % Return on average tangible common equity, annualized 15.89 % 14.91 % 14.57 % Noninterest income to average assets, annualized 0.35 % 0.28 % 0.43 % Noninterest expense to average assets, annualized 1.82 % 1.53 % 1.53 % Yield on average earning assets 4.66 % 4.00 % 3.99 % Cost of average total deposits 0.31 % 0.27 % 0.41 % Cost of average interest-bearing deposits 0.49 % 0.44 % 0.59 % Cost of average interest-bearing liabilities 0.91 % 0.84 % 0.97 % Accretion on loans to average earning assets 0.01 % 0.02 % 0.02 % Net interest spread 3.75 % 3.16 % 3.02 % Net interest margin 4.08 % 3.49 % 3.33 % Efficiency ratio 43.47 % 42.90 % 42.89 % Common stock dividend payout ratio 17.28 % 18.67 % 18.84 % RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) For the six months ended June 30, 2022 2021 Per share data (common stock) Earnings Basic $ 1.56 $ 1.32 Diluted $ 1.54 $ 1.30 Dividends declared $ 0.28 $ 0.25 Book value $ 24.56 $ 22.86 Tangible book value $ 20.55 $ 19.04 Weighted average shares outstanding Basic 19,221,155 19,453,889 Diluted 19,582,902 19,844,077 Shares outstanding at period end 18,881,829 19,349,802 Performance ratios Return on average assets, annualized 1.49 % 1.43 % Return on average shareholders' equity, annualized 12.95 % 11.89 % Return on average tangible common equity, annualized 15.40 % 14.31 % Noninterest income to average assets, annualized 0.32 % 0.56 % Noninterest expense to average assets, annualized 1.67 % 1.69 % Yield on average earning assets 4.32 % 4.23 % Cost of average deposits 0.29 % 0.48 % Cost of average interest-bearing deposits 0.46 % 0.66 % Cost of average interest-bearing liabilities 0.88 % 1.02 % Accretion on loans to average earning assets 0.02 % 0.04 % Net interest spread 3.44 % 3.21 % Net interest margin 3.77 % 3.52 % Efficiency ratio 43.20 % 43.78 % Common stock dividend payout ratio 17.95 % 18.94 % RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) As of June 30, March 31, June 30, 2022 2022 2021 Loan to deposit ratio 100.61 % 94.89 % 88.25 % Core deposits / total deposits 82.16 % 82.54 % 80.04 % Net non-core funding dependence ratio -0.44 % -0.28 % 0.87 % Credit Quality Data: Loans 30-89 days past due $ 8,346 $ 17,635 $ 5,449 Loans 30-89 days past due to total loans 0.27 % 0.59 % 0.20 % Nonperforming loans $ 13,937 $ 20,691 $ 19,243 Nonperforming loans to total loans 0.46 % 0.69 % 0.71 % Nonperforming assets $ 14,230 $ 20,984 $ 19,536 Nonperforming assets to total assets 0.36 % 0.52 % 0.50 % Allowance for loan losses to total loans 1.12 % 1.11 % 1.16 % Allowance for loan losses to nonperforming loans 245.06 % 160.90 % 162.93 % Net charge-offs to average loans (for the quarter-to-date period) 0.01 % 0.00 % 0.01 % Regulatory and other capital ratios—Company Tangible common equity to tangible assets 9.98 % 9.87 % 9.65 % Tier 1 leverage ratio 10.96 % 9.90 % 10.20 % Tier 1 common capital to risk-weighted assets 14.84 % 14.12 % 14.76 % Tier 1 capital to risk-weighted assets 15.38 % 14.63 % 15.33 % Total capital to risk-weighted assets 22.98 % 21.96 % 23.48 % Regulatory capital ratios—Bank only Tier 1 leverage ratio 13.90 % 12.29 % 12.34 % Tier 1 common capital to risk-weighted assets 19.55 % 18.15 % 18.58 % Tier 1 capital to risk-weighted assets 19.55 % 18.15 % 18.58 % Total capital to risk-weighted assets 20.80 % 19.37 % 19.83 % RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) 2nd Quarter 1st Quarter 4th Quarter 3rd Quarter 2nd Quarter Quarterly Consolidated Statements of Earnings 2022 2022 2021 2021 2021 Interest income Loans, including fees $ 40,157 $ 37,886 $ 36,783 $ 35,601 $ 34,669 Investment securities and other 2,181 1,680 1,661 1,507 1,302 Total interest income 42,338 39,566 38,444 37,108 35,971 Interest expense Deposits 2,350 2,292 2,431 2,745 3,118 Interest on subordinated debentures and other 2,379 2,348 2,343 2,342 2,356 Other borrowings 519 435 445 445 440 Total interest expense 5,248 5,075 5,219 5,532 5,914 Net interest income before provision for loan losses 37,090 34,491 33,225 31,576 30,057 Provision for loan losses 915 366 635 1,196 628 Net interest income after provision for loan losses 36,175 34,125 32,590 30,380 29,429 Noninterest income 3,422 2,944 3,156 5,524 4,171 Noninterest expense 17,612 16,061 13,300 14,420 14,680 Earnings before income taxes 21,985 21,008 22,446 21,484 18,920 Income taxes 6,508 6,391 6,740 6,120 5,540 Net income $ 15,477 $ 14,617 $ 15,706 $ 15,364 $ 13,380 Net income per common share - basic $ 0.81 $ 0.75 $ 0.81 $ 0.79 $ 0.69 Net income per common share - diluted $ 0.80 $ 0.74 $ 0.79 $ 0.77 $ 0.67 Cash dividends declared per common share $ 0.14 $ 0.14 $ 0.13 $ 0.13 $ 0.13 Cash dividends declared on common shares $ 2,687 $ 2,724 $ 2,537 $ 2,516 $ 2,540 Yield on average assets, annualized 1.60 % 1.39 % 1.52 % 1.54 % 1.39 % Yield on average earning assets 4.66 % 4.00 % 3.97 % 3.97 % 3.99 % Cost of average deposits 0.31 % 0.27 % 0.30 % 0.35 % 0.41 % Cost of average interest-bearing deposits 0.49 % 0.44 % 0.47 % 0.51 % 0.59 % Cost of average interest-bearing liabilities 0.91 % 0.84 % 0.86 % 0.89 % 0.97 % Accretion on loans to average earning assets 0.01 % 0.02 % 0.02 % 0.03 % 0.02 % Net interest margin 4.08 % 3.49 % 3.43 % 3.38 % 3.33 % RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited, except for December 31, 2021) (Dollars in thousands, except per share amounts) Loan Portfolio Detail As ofJune 30, 2022 As ofMarch 31, 2022 As ofDecember 31, 2021 As ofSeptember 30, 2021 As ofJune 30, 2021 (dollars in thousands) $ % $ % $ % $ % $ % Loans: Commercial and industrial $ 238,045 7.8 % $ 280,825 9.3 % $ 268,709 9.2 % $ 276,387 9.7 % $ 277,080 10.2 % SBA 59,303 1.9 % 67,688 2.3 % 76,136 2.6 % 88,784 3.1 % 98,572 3.6 % Construction and land development 356,772 11.7 % 346,766 11.5 % 303,144 10.3 % 271,764 9.6 % 236,965 8.7 % Commercial real estate (1) 1,160,350 38.1 % 1,217,985 40.5 % 1,247,999 42.6 % 1,205,630 42.4 % 1,102,467 40.7 % Single-family residential mortgages 1,205,732 39.6 % 1,064,581 35.4 % 1,004,576 34.3 % 974,780 34.3 % 984,311 36.3 % Other loans 25,744 0.9 % 28,639 1.0 % 30,786 1.0 % 23,009 0.9 % 9,811 0.5 % Total loans (2) $ 3,045,946 100.0 % $ 3,006,484 100.0 % $ 2,931,350 100.0 % $ 2,840,354 100.0 % $ 2,709,206 100.0 % Allowance for loan losses (34,154 ) (33,292 ) (32,912 ) (32,231 ) (31,352 ) Total loans, net $ 3,011,792 $ 2,973,192 $ 2,898,438 $ 2,808,123 $ 2,677,854 (1) Includes non-farm and non-residential loans, multi-family residential loans and non-owner occupied single family residential loans. (2) Net of discounts and deferred fees and costs. Three Months Ended Six Months Ended Change in Allowance for Loan Losses June 30, June 30, (dollars in thousands) 2022 2021 2022 2021 Beginning balance $ 33,292 $ 30,795 $ 32,912 $ 29,337 Additions to the allowance charged to expense 915 628 1,282 2,128 Net recoveries (charge-offs) on loans (53 ) (71 ) (40 ) (113 ) Ending balance $ 34,154 $ 31,352 $ 34,154 $ 31,352 Tangible Book Value Reconciliations (non-GAAP) The tangible book value per share is a non-GAAP disclosure. The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company’s performance. The following is a reconciliation of tangible book value to the Company shareholders’ equity computed in accordance with GAAP, as well as a calculation of tangible book value per share as of June 30, 2022 and 2021, and March 31, 2022. (dollars in thousands, except per share data) June 30, 2022 March 31, 2022 June 30, 2021 Tangible common equity: Total shareholders' equity $ 463,707 $ 464,825 $ 442,325 Adjustments Goodwill (71,498 ) (71,498 ) (69,243 ) Core deposit intangible (4,248 ) (4,525 ) (4,608 ) Tangible common equity $ 387,961 $ 388,802 $ 368,474 Tangible assets: Total assets-GAAP $ 3,964,271 $ 4,013,569 $ 3,890,638 Adjustments Goodwill (71,498 ) (71,498 ) (69,243 ) Core deposit intangible (4,248 ) (4,525 ) (4,608 ) Tangible assets $ 3,888,525 $ 3,937,546 $ 3,816,787 Common shares outstanding $ 18,881,829 19,247,970 19,349,802 Tangible common equity to tangible assets ratio 9.98 % 9.87 % 9.65 % Book value per share $ 24.56 $ 24.15 $ 22.86 Tangible book value per share $ 20.55 $ 20.20 $ 19.04 View source version on businesswire.com: https://www.businesswire.com/news/home/20220725005787/en/ContactsDavid Morris Interim President and CEO CFO (714) 670-2488
Conference Call and Webcast Scheduled for Tuesday, July 26, 2022 at 11:00 a.m. Pacific Time/2:00 p.m. Eastern Time Second Quarter 2022 Highlights Net income of $15.5 million, or $0.80 diluted earnings per share, increased $860,000, or 5.9%, from the prior quarter and increased $2.1 million, or 15.7%, from the second quarter of 2021 Loans grew by $35.9 million, or 4.8% annualized, from the end of the prior quarter Declared $0.14 per share quarterly dividend
RBB Bancorp (NASDAQ:RBB) and its subsidiaries, Royal Business Bank (“the Bank”) and RBB Asset Management Company (“RAM”), collectively referred to herein as “the Company,” announced financial results for the quarter ended June 30, 2022. The Company reported net income of $15.5 million, or $0.80 diluted earnings per share, for the three months ended June 30, 2022, compared to net income of $14.6 million, or $0.74 diluted earnings per share, and $13.4 million, or $ 0.67 diluted earnings per share, for the three months ended March 31, 2022 and June 30, 2021, respectively. “Our performance in the second quarter demonstrated the strength of our differentiated business model as the Bank delivered strong earnings, improving margins, and loan growth,” said David Morris, Interim President and CEO of RBB Bancorp. “Expenses were higher than expected due to the ongoing costs related to the Board of Directors investigation, which we expect to wind down in the third quarter. We were pleased to announce several new hires and re-hires during the quarter and look forward to working with our new colleagues to build shareholder value.” "The excellent second quarter results demonstrate the value of Royal Business Bank," said Dr. James Kao, Chairman of RBB Bancorp. “The Bank is well-positioned to continue to generate attractive returns and shareholder value.” Key Performance Ratios Net income of $15.5 million for the second quarter of 2022 produced an annualized return on average assets ("ROA") of 1.60%, an annualized return on average tangible common shareholders' equity ("ROTCE") of 15.89%, and an annualized return on average shareholders' equity ("ROE") of 13.30%. This compares to an annualized ROA of 1.39%, an annualized ROTCE of 14.91%, and an annualized ROE of 12.59% for the first quarter of 2022. The efficiency ratio for the second quarter of 2022 was 43.47%, compared to 42.90% for the prior quarter. Net Interest Income and Net Interest Margin Net interest income, before provision for loan losses, was $37.1 million for the second quarter of 2022, compared to $34.5 million for the first quarter of 2022. The $2.6 million increase was primarily attributable to 1.25% increase in interest rate by Federal Reserve Bank in the second quarter of 2022. Accretion of purchase discounts from prior acquisitions contributed $75,000 to net interest income in the second quarter of 2022, compared to $246,000 in the first quarter of 2022. Compared to the second quarter of 2021, net interest income, before provision for loan losses, increased $7.0 million from $30.1 million. The increase was primarily attributable to a $289.3 million increase in average loans and a 1.25% increase in interest rate by the Federal Reserve Bank in the second quarter of 2022. The increases in average earning assets were primarily due to increased loan originations. Net interest margin was 4.08% for the second quarter of 2022, an increase of 59 basis points from 3.49% in the first quarter of 2022. Loan discount accretion contributed 1 basis point to the net interest margin in the second quarter of 2022, compared to 2 basis points in the first quarter of 2022. Noninterest Income Noninterest income was $3.4 million for the second quarter of 2022, an increase of $478,000 from $2.9 million in the first quarter of 2022. The increase was primarily driven by a $757,000 increase in gain on sale of corporate real estate, a $272,000 decrease in loss on derivatives and a $94,000 increase in recoveries on purchased loans, partially offset by an $830,000 decrease in gain on sale of loans during the quarter. The Company sold $12.6 million in FNMA qualified mortgage loans for a net gain of $284,000 during the second quarter of 2022 compared to $26.9 million in FNMA qualified mortgage loans sold for a net gain of $711,000 during the first quarter of 2022. The Company sold $1.1 million in SBA loans during the second quarter of 2022 for a net gain of $60,000, compared to $8.3 million SBA loans sold for a net gain of $463,000 during the first quarter of 2022. Compared to the second quarter of 2021, noninterest income decreased by $749,000 from $4.2 million. The decrease was primarily attributable to a $2.2 million decrease in gain on sale of loans, partially offset by a $757,000 increase in gain on corporate real estate, a $354,000 increase in loan servicing fees, an $113,000 increase in income from bank owned life insurance and a $93,000 increase in recoveries on purchased loans. Noninterest Expense Noninterest expense for the second quarter of 2022 was $17.6 million, compared to $16.1 million for the first quarter of 2022. The $1.6 million increase was primarily attributable to a $1.2 million increase in legal and professional expenses due to a Board of Director special investigation and a $259,000 increase in salaries and employee benefits expense due to additional new hires and salary adjustments to reflect economic inflation. Noninterest expense increased from $14.7 million in the second quarter of 2021. The $2.9 million increase was primarily due to a $1.7 million increase in legal and professional expenses due to a Board of Director special investigation, an $886,000 increase in salaries and employee benefits expenses and a $270,000 increase in business promotion and CRA donation expenses. Income Taxes The effective tax rate was 29.6% for the second quarter of 2022, 30.4% for the first quarter of 2022, and 29.3% for the second quarter of 2021. The Company recognized a tax benefit from stock option exercises of $279,000, $23,000 and $68,000 for the second quarter of 2022, the first quarter of 2022, and the second quarter of 2021, respectively. Loan and Securities Portfolio Loans held for investment, net of deferred fees and discounts, totaled $3.05 billion as of June 30, 2022, an increase of $39.5 million from March 31, 2022, and an increase of $336.7 million from June 30, 2021. The increase from the prior quarter was primarily due to a $141.2 million increase in single-family residential mortgage loans and a $10.0 million increase in construction & land development loans, partially offset by a $57.6 million decrease in commercial real estate loans and a $42.8 million decrease in commercial and industrial loans. The increase from June 30, 2021 was primarily due to a $221.4 million increase in single-family residential mortgages and a $119.8 million increase in construction & land development loans. During the second quarter of 2022, single-family residential mortgage production was $216.9 million while net payoffs and paydowns were $66.8 million. During the first quarter of 2022, single-family residential mortgage production was $132.6 million while payoffs and paydowns were $48.1 million. There were no mortgage loans held for sale as of June 30, 2022 compared to $3.6 million as of March 31, 2022 and $9.2 million as of June 30, 2021. The Company originated approximately $1.2 million in FNMA mortgage loans for sale for the second quarter of 2022, compared with $23.4 million during the prior quarter. In the second quarter of 2022, SBA loan production was $1.4 million and total SBA loan sales were $1.1 million compared to SBA loan production of $11.9 million and total SBA loan sales of $8.3 million in the first quarter of 2022. As of June 30, 2022, the Bank’s total Available-for-Sale securities maturing in over 12 months were $249.2 million, and the Bank recorded an unrealized loss of $20.2 million under the Accumulated Other Comprehensive Income (AOCI) since January 1, 2022. Deposits Deposits were $3.0 billion at June 30, 2022, which was a decrease of $140.7 million compared to March 31, 2022. During the second quarter of 2022, noninterest-bearing deposits decreased by $114.7 million, interest-bearing non-maturity deposits decreased by $16.7 million, and time deposits decreased by $9.3 million. As of June 30, 2022, there were $50.0 million in brokered CDs, as compared to no brokered CDs as of March 31, 2022 and $17.4 million brokered CDs as of June 30, 2021. Compared to June 30, 2021, total deposits decreased by $42.4 million primarily due to a $157.0 million decrease in time deposits, partially offset by a $105.0 million increase in noninterest-bearing demand deposits. Asset Quality Nonperforming assets totaled $14.2 million, or 0.36% of total assets at June 30, 2022, compared to $21.0 million, or 0.52% of total assets at March 31, 2022. The decrease in nonperforming assets was due to the pay-off of certain nonperforming loans in the second quarter. Nonperforming assets consist of other real estate owned, loans modified under troubled debt restructurings (“TDR”), non-accrual loans, and loans past due 90 days or more and still accruing interest. In the second quarter of 2022, there were $53,000 in net charge-offs, compared to net recoveries of $14,000 in the first quarter of 2022 and net charge-offs of $71,000 in the second quarter of 2021. The Company recorded a provision for credit losses of $915,000 for the second quarter of 2022 which was primarily attributable to loan growth and was an increase from $366,000 in the prior quarter. Allowance for loan losses continue to include $599,000 of reserves taken as a precaution against COVID-19 losses in 2020 and 2021. The allowance for loan losses totaled $34.2 million, or 1.12% of loans held for investment at June 30, 2022, compared with $33.3 million, or 1.11%, of total loans at March 31, 2022. During the second quarter of 2022, the Company repurchased 525,754 common shares at a weighted average price of $21.10. Corporate Overview RBB Bancorp is a community-based financial holding company headquartered in Los Angeles, California. As of June 30, 2022, the company had total assets of $4.0 billion. Its wholly-owned subsidiary, the Bank is a full service commercial bank, which provides business banking services to the Chinese-American communities in Los Angeles County, Orange County, and Ventura County in California, in Las Vegas, Nevada, in Brooklyn, Queens, and Manhattan in New York, in Edison, New Jersey, in the Chicago neighborhoods of Chinatown and Bridgeport, Illinois, and on Oahu, Hawaii. Bank services include remote deposit, E-banking, mobile banking, commercial and investor real estate loans, business loans and lines of credit, commercial and industrial loans, SBA 7A and 504 loans, 1-4 single family residential loans, automobile lending, trade finance, a full range of depository account products and wealth management services. The Bank has nine branches in Los Angeles County, two branches in Ventura County, one branch in Orange County, California, one branch in Las Vegas, Nevada, three branches and one loan operation center in Brooklyn, three branches in Queens, one branch in Manhattan in New York, one branch in Edison, New Jersey, two branches in Chicago, Illinois, and one branch in Honolulu, Hawaii. The Company's administrative and lending center is located at 1055 Wilshire Blvd., Los Angeles, California 90017, and its finance and operations center is located at 7025 Orangethorpe Ave., Buena Park, California 90621. The Company's website address is www.royalbusinessbankusa.com. Conference Call Management will hold a conference call at 11:00 a.m. Pacific time/2:00 p.m. Eastern time tomorrow, July 26, 2022, to discuss the Company’s second quarter 2022 financial results. To listen to the conference call, please dial 1-866-459-5346 or 1-203-518-9544, conference ID RBBQ222. A replay of the call will be made available at 1-877-274-8334 or 1-402-220-2326 (no passcode required) approximately one hour after the conclusion of the call and will remain available through August 2, 2022. The conference call will also be simultaneously webcast over the Internet; please visit our Royal Business Bank website at www.royalbusinessbankusa.com and click on the “Investors” tab to access the call from the site. This webcast will be recorded and available for replay on our website approximately two hours after the conclusion of the conference call. Disclosure This press release contains certain non-GAAP financial disclosures for tangible common equity and tangible assets and adjusted earnings. The Company uses certain non- GAAP financial measures to provide meaningful supplemental information regarding the Company’s operational performance and to enhance investors’ overall understanding of such financial performance. Please refer to the tables at the end of this release for a presentation of performance ratios in accordance with GAAP and a reconciliation of the non-GAAP financial measures to the GAAP financial measures. Safe Harbor Certain matters set forth herein (including the exhibits hereto) constitute forward-looking statements relating to the Company’s current business plans and expectations and our future financial position and operating results. These forward-looking statements are subject to risks and uncertainties that could cause actual results, performance and/or achievements to differ materially from those projected. These risks and uncertainties include, but are not limited to, local, regional, national and international economic and market conditions and events and the impact they may have on us, our customers and our assets and liabilities; our ability to attract deposits and other sources of funding or liquidity; supply and demand for real estate and periodic deterioration in real estate prices and/or values in California or other states where we lend, including both residential and commercial real estate; a prolonged slowdown or decline in real estate construction, sales or leasing activities; changes in the financial performance and/or condition of our borrowers, depositors or key vendors or counterparties; changes in our levels of delinquent loans, nonperforming assets, allowance for loan losses and charge-offs; expectations regarding the impact of the COVID-19 pandemic; the costs or effects of acquisitions or dispositions we may make, whether we are able to obtain any required governmental or shareholder approvals in connection with any such acquisitions or dispositions, and/or our ability to realize the contemplated financial or business benefits associated with any such acquisitions or dispositions; the effect of changes in laws, regulations and applicable judicial decisions (including laws, regulations and judicial decisions concerning financial reforms, taxes, banking capital levels, consumer, commercial or secured lending, securities and securities trading and hedging, compliance, employment, executive compensation, insurance, vendor management and information security) with which we and our subsidiaries must comply or believe we should comply; changes in estimates of future reserve requirements and minimum capital requirements based upon the periodic review thereof under relevant regulatory and accounting requirements, including changes in the Basel Committee framework establishing capital standards for credit, operations and market risk; inflation, interest rate, securities market and monetary fluctuations; changes in government interest rates or monetary policies; changes in the amount and availability of deposit insurance; cyber-security threats, including loss of system functionality or theft or loss of Company or customer data or money; political instability; acts of war or terrorism, or natural disasters, such as earthquakes, drought, or the effects of pandemic diseases; the timely development and acceptance of new banking products and services and the perceived overall value of these products and services by our customers and potential customers; the Company’s relationships with and reliance upon vendors with respect to the operation of certain of the Company’s key internal and external systems and applications; changes in commercial or consumer spending, borrowing and savings preferences or behaviors; technological changes and the expanding use of technology in banking (including the adoption of mobile banking and funds transfer applications); the ability to retain and increase market share, retain and grow customers and control expenses; changes in the competitive and regulatory environment among financial and bank holding companies, banks and other financial service providers; volatility in the credit and equity markets and its effect on the general economy or local or regional business conditions; fluctuations in the price of the Company’s common stock or other securities; and the resulting impact on the Company’s ability to raise capital or make acquisitions, the effect of changes in accounting policies and practices, as may be adopted from time-to-time by our regulatory agencies, as well as by the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard-setters, including ASU 2016-13 (Topic 326), “Measurement of Credit Losses on Financial Instruments”, commonly referenced as the Current Expected Credit Loss (“CECL”) model, which will change how we estimate credit losses and may increase the required level of our allowance for credit losses after adoption; changes in our organization, management, compensation and benefit plans, and our ability to retain or expand our workforce, management team and/or our board of directors; the costs and effects of legal, compliance and regulatory actions, changes and developments, including the initiation and resolution of legal proceedings (such as securities, consumer or employee class action litigation), regulatory or other governmental inquiries or investigations, and/or the results of regulatory examinations or reviews; our ongoing relations with our various federal and state regulators, including the SEC, FDIC, FRB and California DFPI (formerly DBO); our success at managing the risks involved in the foregoing items and all other factors set forth in the Company’s public reports, including its Annual Report as filed under Form 10-K/A and Form 10-K for the year ended December 31, 2021, and particularly the discussion of risk factors within that document. The Company does not undertake, and specifically disclaims any obligation, to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements except as required by law. Any statements about future operating results, such as those concerning accretion and dilution to the Company’s earnings or shareholders, are for illustrative purposes only, are not forecasts, and actual results may differ. RBB BANCORP AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited, except for December 31, 2021) (Dollars in thousands) June 30, March 31, December 31, September 30, June 30, 2022 2022 2021 2021 2021 Assets Cash and due from banks $ 224,736 $ 149,767 $ 501,372 $ 206,927 $ 493,653 Federal funds sold and other cash equivalents 100,000 200,000 193,000 170,000 110,000 Total cash and cash equivalents 324,736 349,767 694,372 376,927 603,653 Interest-bearing deposits in other financial institutions 600 600 600 600 600 Investment securities available for sale 358,135 420,448 368,260 345,000 339,568 Investment securities held to maturity 5,741 6,246 6,252 6,258 6,664 Mortgage loans held for sale — 3,572 5,957 15,188 9,246 Loans held for investment 3,045,946 3,006,484 2,931,350 2,840,354 2,709,206 Allowance for loan losses (34,154 ) (33,292 ) (32,912 ) (32,231 ) (31,352 ) Net loans held for investment 3,011,792 2,973,192 2,898,438 2,808,123 2,677,854 Premises and equipment, net 27,104 27,455 27,199 27,157 27,039 Federal Home Loan Bank (FHLB) stock 15,000 15,000 15,000 15,000 15,000 Cash surrender value of life insurance 56,642 56,313 55,988 55,656 55,325 Goodwill 71,498 71,498 69,243 69,243 69,243 Servicing assets 10,456 11,048 11,517 12,141 12,558 Core deposit intangibles 4,248 4,525 4,075 4,327 4,608 Right-of-use assets- operating leases 21,166 22,451 22,454 23,735 25,050 Accrued interest and other assets 57,153 51,454 48,839 42,452 44,230 Total assets $ 3,964,271 $ 4,013,569 $ 4,228,194 $ 3,801,807 $ 3,890,638 Liabilities and shareholders' equity Deposits: Noninterest-bearing demand $ 1,045,009 $ 1,159,703 $ 1,291,484 $ 824,771 $ 940,041 Savings, NOW and money market accounts 868,307 885,050 927,609 931,517 858,597 Time deposits, less than $250,000 574,050 570,274 587,940 614,146 658,393 Time deposits, greater than or equal to $250,000 540,199 553,226 578,499 597,379 612,894 Total deposits 3,027,565 3,168,253 3,385,532 2,967,813 3,069,925 Reserve for unfunded commitments 1,070 1,186 1,203 1,304 1,216 FHLB advances 250,000 150,000 150,000 150,000 150,000 Long-term debt, net of debt issuance costs 173,296 173,152 173,007 172,862 172,718 Subordinated debentures 14,611 14,556 14,502 14,447 14,393 Lease liabilities - operating leases 22,057 23,314 23,282 24,524 25,798 Accrued interest and other liabilities 11,965 18,283 13,985 14,833 14,263 Total liabilities 3,500,564 3,548,744 3,761,511 3,345,783 3,448,313 Shareholders' equity: Shareholder's equity 479,382 475,077 468,267 456,490 442,086 Non-controlling interest 72 72 72 72 72 Accumulated other comprehensive (loss) income - Net of tax (15,747 ) (10,324 ) (1,656 ) (538 ) 167 Total shareholders' equity 463,707 464,825 466,683 456,024 442,325 Total liabilities and shareholders’ equity $ 3,964,271 $ 4,013,569 $ 4,228,194 $ 3,801,807 $ 3,890,638 RBB BANCORP AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Dollars in thousands, except per share amounts) For the Three Months Ended June 30, 2022 March 31, 2022 June 30, 2021 Interest and dividend income: Interest and fees on loans $ 40,157 $ 37,886 $ 34,669 Interest on interest-bearing deposits 111 171 125 Interest on investment securities 1,419 1,007 794 Dividend income on FHLB stock 222 227 225 Interest on federal funds sold and other 429 275 158 Total interest income 42,338 39,566 35,971 Interest expense: Interest on savings deposits, NOW and money market accounts 844 718 708 Interest on time deposits 1,506 1,574 2,410 Interest on subordinated debentures and long term debt 2,379 2,348 2,356 Interest on other borrowed funds 519 435 440 Total interest expense 5,248 5,075 5,914 Net interest income before provision for loan losses 37,090 34,491 30,057 Provision for loan losses 915 366 628 Net interest income after provision for loan losses 36,175 34,125 29,429 Noninterest income: Service charges, fees and other 1,382 1,241 1,332 Gain on sale of loans 344 1,174 2,572 Loan servicing fees, net of amortization 472 432 118 Recoveries on loans acquired in business combinations 98 5 5 Unrealized (loss) on equity investments — — (35 ) Gain (loss) on derivatives 39 (233 ) (38 ) Increase in cash surrender value of life insurance 330 325 217 Gain on sale of fixed assets 757 — — Total noninterest income 3,422 2,944 4,171 Noninterest expense: Salaries and employee benefits 9,628 9,369 8,742 Occupancy and equipment expenses 2,174 2,206 2,135 Data processing 1,293 1,258 1,231 Legal and professional 2,254 1,006 536 Office expenses 358 293 272 Marketing and business promotion 501 307 231 Insurance and regulatory assessments 478 441 354 Core deposit premium 277 279 287 OREO expenses 5 8 4 Merger expenses 23 37 17 Other expenses 621 857 871 Total noninterest expense 17,612 16,061 14,680 Income before income taxes 21,985 21,008 18,920 Income tax expense 6,508 6,391 5,540 Net income $ 15,477 $ 14,617 $ 13,380 Net income per share Basic $ 0.81 $ 0.75 $ 0.69 Diluted $ 0.80 $ 0.74 $ 0.67 Cash Dividends declared per common share $ 0.14 $ 0.14 $ 0.13 Weighted-average common shares outstanding Basic 19,066,621 19,377,407 19,432,204 Diluted 19,368,860 19,799,323 19,874,969 RBB BANCORP AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Dollars in thousands, except per share amounts) For the Six Months Ended June 30, 2022 June 30, 2021 Interest and dividend income: Interest and fees on loans $ 78,043 $ 69,185 Interest on interest-earning deposits 282 173 Interest on investment securities 2,426 1,421 Dividend income on FHLB stock 449 417 Interest on federal funds sold and other 704 315 Total interest income 81,904 71,511 Interest expense: Interest on savings deposits, NOW and money market accounts 1,562 1,406 Interest on time deposits 3,080 5,374 Interest on subordinated debentures and long term debt 4,727 4,314 Interest on other borrowed funds 954 875 Total interest expense 10,323 11,969 Net interest income 71,581 59,542 Provision for loan losses 1,282 2,128 Net interest income after provision for loans losses 70,299 57,414 Noninterest income: Service charges, fees and other (1) 2,622 2,800 Gain on sale of loans 1,518 6,413 Loan servicing fees, net of amortization 904 364 Recoveries on loans acquired in business combinations 103 10 Unrealized (loss) gain on equity investments — (55 ) (Loss) gain on derivatives (194 ) 129 Increase in cash surrender value of life insurance 654 404 Gain on sale of fixed assets 757 — Total noninterest income 6,364 10,065 Noninterest expense: Salaries and employee benefits 18,997 17,984 Occupancy and equipment expenses 4,380 4,377 Data processing 2,551 2,671 Legal and professional 3,260 1,341 Office expenses 651 527 Marketing and business promotion 808 415 Insurance and regulatory assessments 919 702 Core deposit premium 556 588 OREO expenses 13 9 Merger expenses 60 59 Other expenses 1,475 1,799 Total noninterest expense 33,670 30,472 Income before income taxes 42,993 37,007 Income tax expense 12,899 11,171 Net income $ 30,094 $ 25,836 Net income per share Basic $ 1.56 $ 1.32 Diluted $ 1.54 $ 1.30 Cash Dividends declared per common share $ 0.28 $ 0.25 Weighted-average common shares outstanding Basic 19,221,155 19,453,889 Diluted 19,582,902 19,844,077 RBB BANCORP AND SUBSIDIARIES AVERAGE BALANCE SHEET AND NET INTEREST INCOME (Unaudited) (Dollars in thousands, except per share amounts) For the three months ended June 30, 2022 March 31, 2022 June 30, 2021 Average Interest Yield / Average Interest Yield / Average Interest Yield / (tax-equivalent basis, dollars in thousands) Balance & Fees Rate Balance & Fees Rate Balance & Fees Rate Earning assets: Federal funds sold, cash equivalents & other (1) $ 249,738 $ 762 1.22 % $ 628,634 $ 673 0.43 % $ 582,554 $ 508 0.35 % Securities Available for sale (2) 399,321 1,393 1.40 % 392,858 974 1.01 % 328,004 751 0.92 % Held to maturity (2) 5,744 50 3.49 % 6,250 57 3.70 % 6,667 60 3.61 % Mortgage loans held for sale 892 13 5.85 % 3,652 43 4.78 % 21,033 173 3.30 % Loans held for investment: (3) Real estate 2,663,753 35,207 5.30 % 2,602,382 33,095 5.16 % 2,292,145 29,794 5.21 % Commercial 325,861 4,937 6.08 % 380,978 4,748 5.05 % 388,049 4,702 4.86 % Total loans 2,989,614 40,144 5.39 % 2,983,360 37,843 5.14 % 2,680,194 34,496 5.16 % Total earning assets 3,645,309 $ 42,362 4.66 % 4,014,754 $ 39,590 4.00 % 3,618,452 $ 35,988 3.99 % Noninterest-earning assets 243,227 241,235 230,049 Total assets $ 3,888,536 $ 4,255,989 $ 3,848,501 Interest-bearing liabilities NOW $ 75,637 $ 50 0.27 % $ 75,399 $ 43 0.23 % $ 66,777 $ 45 0.27 % Money Market 631,807 759 0.48 % 720,197 643 0.36 % 640,026 628 0.39 % Saving deposits 148,400 35 0.09 % 145,327 32 0.09 % 140,418 35 0.10 % Time deposits, less than $250,000 553,282 724 0.52 % 600,563 754 0.51 % 657,494 1,163 0.71 % Time deposits, $250,000 and over 526,164 782 0.60 % 570,210 820 0.58 % 604,429 1,247 0.83 % Total interest-bearing deposits 1,935,290 2,350 0.49 % 2,111,696 2,292 0.44 % 2,109,144 3,118 0.59 % FHLB advances 182,749 519 1.14 % 150,000 435 1.18 % 150,000 440 1.18 % Long-term debt 173,201 2,195 5.08 % 173,058 2,194 5.14 % 172,622 2,206 5.13 % Subordinated debentures 14,575 184 5.06 % 14,521 154 4.30 % 14,357 150 4.19 % Total interest-bearing liabilities 2,305,815 5,248 0.91 % 2,449,275 5,075 0.84 % 2,446,123 5,914 0.97 % Noninterest-bearing liabilities Noninterest-bearing deposits 1,082,793 1,301,497 913,442 Other noninterest-bearing liabilities 33,325 34,319 46,549 Total noninterest-bearing liabilities 1,116,118 1,335,816 959,991 Shareholders' equity 466,603 470,898 442,387 Total liabilities and shareholders' equity $ 3,888,536 $ 4,255,989 $ 3,848,501 Net interest income / interest rate spreads $ 37,114 3.75 % $ 34,515 3.16 % $ 30,074 3.02 % Net interest margin 4.08 % 3.49 % 3.33 % (1) Includes income and average balances for FHLB stock, term federal funds, interest-bearing time deposits and other miscellaneous interest-bearing assets. (2) Interest income and average rates for tax-exempt loans and securities are presented on a tax-equivalent basis. (3) Average loan balances include nonaccrual loans and loans held for sale. Interest income on loans includes - amortization of deferred loan fees, net of deferred loan costs. RBB BANCORP AND SUBSIDIARIES AVERAGE BALANCE SHEET AND NET INTEREST INCOME (Unaudited) (Dollars in thousands, except per share amounts) For the six months ended June 30, 2022 June 30, 2021 Average Interest Yield / Average Interest Yield / (tax-equivalent basis, dollars in thousands) Balance & Fees Rate Balance & Fees Rate Earning assets: Federal funds sold, cash equivalents & other (1) $ 438,140 $ 1,435 0.66 % $ 399,907 $ 905 0.46 % Securities Available for sale (2) 396,107 2,367 1.21 % 284,129 1,323 0.94 % Held to maturity (2) 5,996 107 3.60 % 6,832 126 3.72 % Mortgage loans held for sale 2,265 56 4.99 % 37,436 584 3.15 % Loans held for investment: (3) Real estate 2,633,237 68,302 5.23 % 2,299,746 59,315 5.20 % Commercial 353,267 9,685 5.53 % 386,256 9,286 4.85 % Total loans 2,986,504 77,987 5.27 % 2,686,002 68,601 5.15 % Total earning assets 3,829,012 $ 81,952 4.32 % 3,414,306 $ 71,539 4.23 % Noninterest-earning assets 242,235 229,032 Total assets $ 4,071,247 $ 3,643,338 Interest-bearing liabilities NOW $ 75,519 $ 94 0.25 % $ 65,690 $ 88 0.27 % Money Market 675,758 1,401 0.42 % 609,854 1,251 0.41 % Saving deposits 146,872 67 0.09 % 135,810 67 0.10 % Time deposits, less than $250,000 576,792 1,478 0.52 % 660,246 2,659 0.81 % Time deposits, $250,000 and over 548,065 1,602 0.59 % 599,234 2,716 0.91 % Total interest-bearing deposits 2,023,006 4,642 0.46 % 2,070,834 6,781 0.66 % FHLB advances 166,465 954 1.16 % 150,000 875 1.18 % Long-term debt 173,129 4,388 5.11 % 142,349 4,015 5.69 % Subordinated debentures 14,548 339 4.70 % 14,330 298 4.19 % Total interest-bearing liabilities 2,377,148 $ 10,323 0.88 % 2,377,513 $ 11,969 1.02 % Noninterest-bearing liabilities Noninterest-bearing deposits 1,191,540 784,276 Other noninterest-bearing liabilities 33,820 43,352 Total noninterest-bearing liabilities 1,225,360 827,628 Shareholders' equity 468,739 438,197 Total liabilities and shareholders' equity $ 4,071,247 $ 3,643,338 Net interest income / interest rate spreads $ 71,629 3.44 % $ 59,570 3.21 % Net interest margin 3.77 % 3.52 % (1) Includes income and average balances for FHLB stock, term federal funds, interest-bearing time deposits and other miscellaneous interest-bearing assets. (2) Interest income and average rates for tax-exempt loans and securities are presented on a tax-equivalent basis. (3) Average loan balances include nonaccrual loans and loans held for sale. Interest income on loans includes - amortization of deferred loan fees, net of deferred loan costs. RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) For the three months ended June 30, March 31, June 30, 2022 2022 2021 Per share data (common stock) Earnings Basic $ 0.81 $ 0.75 $ 0.69 Diluted $ 0.80 $ 0.74 $ 0.67 Dividends declared $ 0.14 $ 0.14 $ 0.13 Book value $ 24.56 $ 24.15 $ 22.86 Tangible book value $ 20.55 $ 20.20 $ 19.04 Weighted average shares outstanding Basic 19,066,621 19,377,407 19,432,204 Diluted 19,368,860 19,799,323 19,874,969 Shares outstanding at period end 18,881,829 19,247,970 19,349,802 Performance ratios Return on average assets, annualized 1.60 % 1.39 % 1.39 % Return on average shareholders' equity, annualized 13.30 % 12.59 % 12.13 % Return on average tangible common equity, annualized 15.89 % 14.91 % 14.57 % Noninterest income to average assets, annualized 0.35 % 0.28 % 0.43 % Noninterest expense to average assets, annualized 1.82 % 1.53 % 1.53 % Yield on average earning assets 4.66 % 4.00 % 3.99 % Cost of average total deposits 0.31 % 0.27 % 0.41 % Cost of average interest-bearing deposits 0.49 % 0.44 % 0.59 % Cost of average interest-bearing liabilities 0.91 % 0.84 % 0.97 % Accretion on loans to average earning assets 0.01 % 0.02 % 0.02 % Net interest spread 3.75 % 3.16 % 3.02 % Net interest margin 4.08 % 3.49 % 3.33 % Efficiency ratio 43.47 % 42.90 % 42.89 % Common stock dividend payout ratio 17.28 % 18.67 % 18.84 % RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) For the six months ended June 30, 2022 2021 Per share data (common stock) Earnings Basic $ 1.56 $ 1.32 Diluted $ 1.54 $ 1.30 Dividends declared $ 0.28 $ 0.25 Book value $ 24.56 $ 22.86 Tangible book value $ 20.55 $ 19.04 Weighted average shares outstanding Basic 19,221,155 19,453,889 Diluted 19,582,902 19,844,077 Shares outstanding at period end 18,881,829 19,349,802 Performance ratios Return on average assets, annualized 1.49 % 1.43 % Return on average shareholders' equity, annualized 12.95 % 11.89 % Return on average tangible common equity, annualized 15.40 % 14.31 % Noninterest income to average assets, annualized 0.32 % 0.56 % Noninterest expense to average assets, annualized 1.67 % 1.69 % Yield on average earning assets 4.32 % 4.23 % Cost of average deposits 0.29 % 0.48 % Cost of average interest-bearing deposits 0.46 % 0.66 % Cost of average interest-bearing liabilities 0.88 % 1.02 % Accretion on loans to average earning assets 0.02 % 0.04 % Net interest spread 3.44 % 3.21 % Net interest margin 3.77 % 3.52 % Efficiency ratio 43.20 % 43.78 % Common stock dividend payout ratio 17.95 % 18.94 % RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) As of June 30, March 31, June 30, 2022 2022 2021 Loan to deposit ratio 100.61 % 94.89 % 88.25 % Core deposits / total deposits 82.16 % 82.54 % 80.04 % Net non-core funding dependence ratio -0.44 % -0.28 % 0.87 % Credit Quality Data: Loans 30-89 days past due $ 8,346 $ 17,635 $ 5,449 Loans 30-89 days past due to total loans 0.27 % 0.59 % 0.20 % Nonperforming loans $ 13,937 $ 20,691 $ 19,243 Nonperforming loans to total loans 0.46 % 0.69 % 0.71 % Nonperforming assets $ 14,230 $ 20,984 $ 19,536 Nonperforming assets to total assets 0.36 % 0.52 % 0.50 % Allowance for loan losses to total loans 1.12 % 1.11 % 1.16 % Allowance for loan losses to nonperforming loans 245.06 % 160.90 % 162.93 % Net charge-offs to average loans (for the quarter-to-date period) 0.01 % 0.00 % 0.01 % Regulatory and other capital ratios—Company Tangible common equity to tangible assets 9.98 % 9.87 % 9.65 % Tier 1 leverage ratio 10.96 % 9.90 % 10.20 % Tier 1 common capital to risk-weighted assets 14.84 % 14.12 % 14.76 % Tier 1 capital to risk-weighted assets 15.38 % 14.63 % 15.33 % Total capital to risk-weighted assets 22.98 % 21.96 % 23.48 % Regulatory capital ratios—Bank only Tier 1 leverage ratio 13.90 % 12.29 % 12.34 % Tier 1 common capital to risk-weighted assets 19.55 % 18.15 % 18.58 % Tier 1 capital to risk-weighted assets 19.55 % 18.15 % 18.58 % Total capital to risk-weighted assets 20.80 % 19.37 % 19.83 % RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) 2nd Quarter 1st Quarter 4th Quarter 3rd Quarter 2nd Quarter Quarterly Consolidated Statements of Earnings 2022 2022 2021 2021 2021 Interest income Loans, including fees $ 40,157 $ 37,886 $ 36,783 $ 35,601 $ 34,669 Investment securities and other 2,181 1,680 1,661 1,507 1,302 Total interest income 42,338 39,566 38,444 37,108 35,971 Interest expense Deposits 2,350 2,292 2,431 2,745 3,118 Interest on subordinated debentures and other 2,379 2,348 2,343 2,342 2,356 Other borrowings 519 435 445 445 440 Total interest expense 5,248 5,075 5,219 5,532 5,914 Net interest income before provision for loan losses 37,090 34,491 33,225 31,576 30,057 Provision for loan losses 915 366 635 1,196 628 Net interest income after provision for loan losses 36,175 34,125 32,590 30,380 29,429 Noninterest income 3,422 2,944 3,156 5,524 4,171 Noninterest expense 17,612 16,061 13,300 14,420 14,680 Earnings before income taxes 21,985 21,008 22,446 21,484 18,920 Income taxes 6,508 6,391 6,740 6,120 5,540 Net income $ 15,477 $ 14,617 $ 15,706 $ 15,364 $ 13,380 Net income per common share - basic $ 0.81 $ 0.75 $ 0.81 $ 0.79 $ 0.69 Net income per common share - diluted $ 0.80 $ 0.74 $ 0.79 $ 0.77 $ 0.67 Cash dividends declared per common share $ 0.14 $ 0.14 $ 0.13 $ 0.13 $ 0.13 Cash dividends declared on common shares $ 2,687 $ 2,724 $ 2,537 $ 2,516 $ 2,540 Yield on average assets, annualized 1.60 % 1.39 % 1.52 % 1.54 % 1.39 % Yield on average earning assets 4.66 % 4.00 % 3.97 % 3.97 % 3.99 % Cost of average deposits 0.31 % 0.27 % 0.30 % 0.35 % 0.41 % Cost of average interest-bearing deposits 0.49 % 0.44 % 0.47 % 0.51 % 0.59 % Cost of average interest-bearing liabilities 0.91 % 0.84 % 0.86 % 0.89 % 0.97 % Accretion on loans to average earning assets 0.01 % 0.02 % 0.02 % 0.03 % 0.02 % Net interest margin 4.08 % 3.49 % 3.43 % 3.38 % 3.33 % RBB BANCORP AND SUBSIDIARIES SELECTED FINANCIAL HIGHLIGHTS (Unaudited, except for December 31, 2021) (Dollars in thousands, except per share amounts) Loan Portfolio Detail As ofJune 30, 2022 As ofMarch 31, 2022 As ofDecember 31, 2021 As ofSeptember 30, 2021 As ofJune 30, 2021 (dollars in thousands) $ % $ % $ % $ % $ % Loans: Commercial and industrial $ 238,045 7.8 % $ 280,825 9.3 % $ 268,709 9.2 % $ 276,387 9.7 % $ 277,080 10.2 % SBA 59,303 1.9 % 67,688 2.3 % 76,136 2.6 % 88,784 3.1 % 98,572 3.6 % Construction and land development 356,772 11.7 % 346,766 11.5 % 303,144 10.3 % 271,764 9.6 % 236,965 8.7 % Commercial real estate (1) 1,160,350 38.1 % 1,217,985 40.5 % 1,247,999 42.6 % 1,205,630 42.4 % 1,102,467 40.7 % Single-family residential mortgages 1,205,732 39.6 % 1,064,581 35.4 % 1,004,576 34.3 % 974,780 34.3 % 984,311 36.3 % Other loans 25,744 0.9 % 28,639 1.0 % 30,786 1.0 % 23,009 0.9 % 9,811 0.5 % Total loans (2) $ 3,045,946 100.0 % $ 3,006,484 100.0 % $ 2,931,350 100.0 % $ 2,840,354 100.0 % $ 2,709,206 100.0 % Allowance for loan losses (34,154 ) (33,292 ) (32,912 ) (32,231 ) (31,352 ) Total loans, net $ 3,011,792 $ 2,973,192 $ 2,898,438 $ 2,808,123 $ 2,677,854 (1) Includes non-farm and non-residential loans, multi-family residential loans and non-owner occupied single family residential loans. (2) Net of discounts and deferred fees and costs. Three Months Ended Six Months Ended Change in Allowance for Loan Losses June 30, June 30, (dollars in thousands) 2022 2021 2022 2021 Beginning balance $ 33,292 $ 30,795 $ 32,912 $ 29,337 Additions to the allowance charged to expense 915 628 1,282 2,128 Net recoveries (charge-offs) on loans (53 ) (71 ) (40 ) (113 ) Ending balance $ 34,154 $ 31,352 $ 34,154 $ 31,352 Tangible Book Value Reconciliations (non-GAAP) The tangible book value per share is a non-GAAP disclosure. The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company’s performance. The following is a reconciliation of tangible book value to the Company shareholders’ equity computed in accordance with GAAP, as well as a calculation of tangible book value per share as of June 30, 2022 and 2021, and March 31, 2022. (dollars in thousands, except per share data) June 30, 2022 March 31, 2022 June 30, 2021 Tangible common equity: Total shareholders' equity $ 463,707 $ 464,825 $ 442,325 Adjustments Goodwill (71,498 ) (71,498 ) (69,243 ) Core deposit intangible (4,248 ) (4,525 ) (4,608 ) Tangible common equity $ 387,961 $ 388,802 $ 368,474 Tangible assets: Total assets-GAAP $ 3,964,271 $ 4,013,569 $ 3,890,638 Adjustments Goodwill (71,498 ) (71,498 ) (69,243 ) Core deposit intangible (4,248 ) (4,525 ) (4,608 ) Tangible assets $ 3,888,525 $ 3,937,546 $ 3,816,787 Common shares outstanding $ 18,881,829 19,247,970 19,349,802 Tangible common equity to tangible assets ratio 9.98 % 9.87 % 9.65 % Book value per share $ 24.56 $ 24.15 $ 22.86 Tangible book value per share $ 20.55 $ 20.20 $ 19.04 View source version on businesswire.com: https://www.businesswire.com/news/home/20220725005787/en/