AMERICAN BUSINESS BANK (Bank) (OTCBB: AMBZ) today reported net income of $2,663,000 for the second quarter of 2012, a 5.8% increase over the $2,516,000 earned in the second quarter of 2011. Earnings per share (EPS) in the second quarter of 2012 increased to $0.60 versus $0.57 in the second quarter of 2011. Shares outstanding as of June 30, 2012 totaled 4,430,302.

“Our marketing effort continues to be robust and we have been able to add several new relationship managers to our team, which will insure our forward momentum,” said Leon Blankstein, President.

“We continue to produce double-digit returns on equity, which is exceptional considering both this low interest rate environment and slow economy,” said Bob Schack, Chairman of the Bank.

"The Bank’s deposit growth has been outstanding," added Wes Schaefer, Vice Chairman. “Our deposits are driven through the excellent efforts put forth by our Relationship Manager staff with the support of a knowledgeable cadre of customer service specialists.”

Assets and Liabilities

Total assets increased 11% or $128 million to $1.236 billion at June 30, 2012 as compared to $1.108 billion at June 30, 2011. Loans increased 7% or $28 million to $426 million at June 30, 2012 as compared to $398 million at June 30, 2011 while investments and federal funds sold increased $87 million. Funding the asset growth was a 14% or $130 million increase in deposits.

Interest Income

During the second quarter of 2012, Net Interest Income rose $288,000 or 3% to $8,999,000 from $8,771,000 during the same period in 2011.

Non-Interest Income

Non-Interest Income for the second quarter in 2012 rose $61,000 or 6% to $1,083,000 from $1,022,000 during the second quarter of 2011.

Credit Quality

Asset quality at quarter-end remains excellent, with nominal past dues and no OREO loans. At the end of June of 2012, the allowance for loan losses stood at $9,542,000 or 2.19% of loans.

AMERICAN BUSINESS BANK headquartered in downtown Los Angeles offers a wide range of financial services to the business marketplace. Clients include wholesalers, manufacturers, service businesses, professionals and non-profits. The Bank has opened four Loan Production Offices in strategic areas including our Orange County Office in Irvine, our South Bay Office in Torrance, our San Fernando Valley Office in the Warner Center and our Inland Empire Office in Ontario.

        AMERICAN BUSINESS BANK BALANCE SHEET ( Unaudited - 000's omitted)  

 

June

  2012   2011 Assets   Investment Securities $ 719,889 $ 636,881 Federal Funds Sold 4,000 - Loans and Leases (net) 425,694 397,567

Cash, Checks in process of collection, Due From Banks

47,356 37,529 Premises, Equipment and Other Assets   39,670   36,352   Total Assets $ 1,236,609 $ 1,108,329   Liabilities and Shareholders' Equity   Demand Deposits 494,870 387,674 Money Market and NOW Deposits 488,136 453,884 Savings and Time Deposits   87,259   98,500 Total Deposits 1,070,265 940,058   FHLB Advances/ Borrowings 52,000 80,200 Other Liabilities 18,333 11,350 Shareholders' Equity   96,011   76,721  

Total Liabilities and Shareholders' Equity

$ 1,236,609 $ 1,108,329       AMERICAN BUSINESS BANK INCOME STATEMENT ( Unaudited - 000's omitted)   Three months ended June           2012   2011   Interest Income Loans and Leases $ 5,474 $ 5,554 Investment Securities   4,251     4,061   Total Interest Income 9,725 9,615   Interest Expense Money Market and NOW Accounts 510 624 Savings and Time Deposits 141 193 Repurchase Agreements/ Other Borrowings   75     87   Total Interest Expense 726 904   Net Interest Income 8,999 8,711   Provision for Loan Losses   (300 )   (582 )

 

Net Interest Income After Provision for Loan Losses

8,699 8,129   Other Income 1,083 1,022   Operating Expenses   5,714     5,727     Operating Income 4,068 3,424   Income Taxes   (1,405 )   (908 )   Net Earnings $ 2,663 $ 2,516   Selected Ratios: Earnings per Share $ 0.60 $ 0.57 Tier 1 Capital Ratio 7.11 % 6.95 % Net Interest Margin (Prior to tax effects) 3.15 % 3.46 % Return on Beginning Equity 11.72 % 13.41 % Return on Average Assets 0.85 % 0.90 % Efficiency Ratio 56.0 % 59.5 %
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