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Merchants National Bank of Sacramento, The

Sacramento, CA · Cert 3502

FDIC · 3 branches

Q4 2018

$209.5MAssets
$86.9MLoans
$187.2MDeposits
$21.0MEquity
Loan mix
89%RE $48.2M11%C&I $5.8M0%Consumer $0.2MQ4 2017Q4 2018
Deposit mix
72%Interest-bearing $134.6M28%Noninterest $52.6MQ4 2017Q4 2018

NIM

2.60%Q4 ’162.67%Q4 ’172.86%Q4 ’180%+5%

Non-interest income vs. expense

1.46%Q4 ’161.66%Q4 ’171.96%Q4 ’18+14%+19%

Market Position · Sacramento--Roseville--Arden-Arcade, CA · 2018 SOD (annual) · 0.4% share · #25 of 38 inst. · $0.2B of $53.1B

Executive Summary

  • Earnings: ROA of 0.43%, up 77 bps year over year; NIM at 2.55%.
  • Asset quality: problem loans at 0.00% of loans (0 bps YoY), with net charge-offs at 0.00%.
  • Capital: tier 1 leverage ratio of 10.70%, up 24 bps from a year ago.
  • Funding: loans stand at 46.42% of deposits as of Q4 2018.

Financial Results

Return on Assets (quarter, annualized)

0.43%+77 bps YoY

Net Interest Margin (quarter, annualized)

2.55%+11 bps YoY

Efficiency Ratio (quarter, annualized)

75.81%+884 bps YoY

Tier 1 Leverage Ratio

10.70%+24 bps YoY

Discrete quarter, annualized.

MetricQ4 2017Q1 2018Q2 2018Q3 2018Q4 2018YoY ΔTrend
Earnings
Return on Assets-0.34%0.66%0.76%0.72%0.43%+77 bps
Return on Equity-3.44%6.94%8.29%7.83%4.47%+791 bps
Net Interest Margin2.43%2.46%2.50%2.53%2.55%+11 bps
Efficiency Ratio66.97%65.36%59.41%61.93%75.81%+884 bps
Non-Interest Burden1.61%1.59%1.45%1.55%1.92%+31 bps
Growth
Asset Growth (YoY)1.25%-0.45%0.53%1.73%-3.29%-454 bps
Loan Growth (YoY)8.91%8.64%5.60%8.46%1.58%-733 bps
Deposit Growth (YoY)1.52%-3.55%6.95%3.87%-1.55%-307 bps
Asset Quality
Nonperforming Loans / Loans0.00%0.00%0.00%0.00%0.00%0 bps
Net Charge-Offs / Loans0.00%0.00%0.00%0.00%0.00%0 bps
Allowance / Loans1.44%1.43%1.40%1.45%1.48%+4 bps
Allowance Coverage of NPLsn/an/an/an/an/an/an/a
Capital
Tier 1 Leverage Ratio10.46%10.46%10.54%10.68%10.70%+24 bps
Total Risk-Based Capital24.07%24.10%23.93%24.44%23.84%-23 bps
Equity / Assets9.59%9.31%9.09%9.32%10.00%+41 bps
Liquidity & Funding
Loans / Deposits44.99%47.24%45.83%45.91%46.42%+143 bps
Liquid Assets / Assets2.10%2.17%3.37%3.56%3.86%+176 bps
CRE / Total Capitaln/an/an/an/an/an/an/a