Central Oregon Office Drives Increase, Plans Expansion
Summit Bank reported net income for the second quarter of $960 thousand or 23 cents per fully diluted share. Earnings for the comparable period one year ago were $684 thousand or 19 cents per fully diluted share. Year to date earnings were $1.7 million or 44 cents per fully diluted share, compared to $1.3 million or 35 cents that the Bank earned during the first six months of 2016.
Profitable growth across all of the Bank’s operating units, particularly the Central Oregon office in Bend, drove the increase in earnings. The Bank was able to achieve a 24 percent increase in earnings per share during the first six months of the fiscal year over the similar period last year after adding $9.5 million in additional equity during the previous 12 months. The equity was a result of an increase in retained earnings and a successful March 2017 capital offering. Return on assets through the second quarter was 1.19 percent and return on equity was 11.64 percent.
“Strong year-over-year results from our Central Oregon office significantly impacted our performance,” said Craig Wanichek, president and CEO. “The acceptance of our community banking model in Central Oregon has been very encouraging. As a result of the growth, the board of directors has approved an expansion of our current office in Bend.”
Many Central Oregon professionals and business owners have sought a local, professional community bank in the region. “As a result, the community has overwhelmingly supported Summit Bank’s entry into the Central Oregon market in 2015, something for which we are both humbled by and grateful for,” says Gary O’Connell, senior vice president, Central Oregon president Summit Bank.
“To further support the vitality and sustainable growth of the local economy, Summit Bank has chosen to make an investment to add additional office space and colleagues. This will help us to serve a growing number of professionals, business owners, and their key staff who have chosen to join Summit Bank.”
Currently in the permitting process with the City of Bend Summit Bank plans to add 745 square feet to its 2,713-square-foot branch on SW Columbia Street with additional employees planned.
“While there has been a high level of market disruption among banks in Central Oregon dating to the last recession, Summit Bank’s business model of operational efficiency, best in class financial performance and being one of Oregon’s 100 Best Companies to work for have combined to create an attractive, stable and competitive local community banking offering,” explained O’Connell.
“Our operational efficiency allows us to provide a competitive offering, our depositors appreciate our financial stability, and our talented colleagues have created a great workplace environment to provide best in class professional service. This enables us to lend more to the business and professional communities, all underwritten locally out of our office. We are excited at the prospect of continuing to support the community in a meaningful way for years to come.”
The Bank continues to experience significant growth in its loan and deposit portfolios. Total net loans as of June 30, 2017, were $255.1 million, representing a $49.0 million or 23.8 percent increase over the second quarter 2016 total of $206.1 million. Total deposits increased by $44.9 million or 19.3 percent over the previous year. Solid earnings over the last four quarters combined with new capital resulting from the Bank’s aforementioned common stock offering have allowed Summit to increase its already strong levels of regulatory capital. Total shareholders’ equity at June 30, 2017, was $32.6 million, an increase of 40.7 percent over Summit’s June 30, 2016 total of $23.2 million.
“The success of our clients and the addition of new relationships led to the significant deposit growth,” said Wanichek. “We were pleased to be able to increase rates for our depositors in June, for both earnings credit on business deposits as well as money market and checking accounts.”
The Bank continues to hold very low levels of non-performing assets. Total non-performing assets at June 30, 2017 represented just 0.75 percent of total assets, an increase from 0.63 percent at June 30, 2016.
