Willamette Community Bank Announces Q4 Earnings

For immediate release: February 7, 2019

Contact: Joan Reukauf, President and Chief Executive Officer
(541) 971-4311 or jreukauf@willamettecommunitybank.com

Willamette Community Bank, one of the fastest growing banks in Oregon, posts best historical earnings

Albany, OR, February 7, 2019- Willamette Community Bank (the “Bank”) (OTCQB: WMCB) based in Albany, Oregon, reports continued growth in the fourth quarter of 2018. Total Assets increased $29 million over year-end 2017 to finish the quarter at $148 million. This represents a 25% increase year over year. “We ended the year strong with great growth in both deposits and loans,” said Willamette Community Bank President and CEO Joan Reukauf. “Our successful capital raise earlier in the year provided the runway needed to deepen our presence in all of our markets.”

Net income increased 44% year over year to $634,000, making 2018 the best earnings year in the Bank’s history. Solid loan growth of 14%, coupled with deposit growth of 20%, contributed to this record earnings year. “We generated not only record growth but record earnings through good core deposit growth, with modest increases in cost of funds and steady loan growth,” Reukauf commented. “Our focus on balance sheet management, pricing, and local market conditions has allowed us to enjoy a healthy net interest margin of 4.51% for the year. Investment in our people, existing relationships, and business development is boosting that performance.”

Credit quality continues to be good with an improvement in total criticized assets to 3.71% of total loans compared to 4.2% in 2017. Adjusted non-accrual loans (non-accrual loans minus government guaranteed percentages and fully participated balances) increased to 2.14% of total loans as of fourth quarter 2018 from 0.53%. This increase is due to three (3) lending relationships consisting of seven (7) loans. Two (2) loans in one relationship matured, and Bank Management elected to not renew the loans to encourage the Borrower to seek alternative financing. Both loans are adequately protected by pledged collateral. Four (4) loans in another relationship were placed on non-accrual due to the deteriorating financial condition of the underlying borrower. The Borrower is current with all contractual payments. One (1) loan in another relationship was placed on non-accrual after it matured during fourth quarter 2018. The Borrower is experiencing financial and management stresses but is cooperating with workout efforts. At this time, no credit losses are anticipated on any of the relationships. “With strong loan growth comes growth in the allowance for loan losses which ended the year at $$1.3 million or 1.26% of total loans.” Reukauf commented. “We continue to closely monitor our credit portfolio both for quality and concentrations, aligning our risk management with our growth strategy.”

Financial Highlights (as of, or for the period ending December 31, 2018, except as noted)

  • Net income increased through December 2018 to $634,000, or $0.36 per share, an increase of $194,000 over the previous year. On a pre-tax/pre-provision basis, net income ended the year at $910,000, a 29% increase over 2017.
  • Net interest income increased year over year by 24% to $5.68 million. Non-interest income grew by 45% from $261,000 in 2017 to $380,000 in 2018.
  • Return on average assets (ROAA) increased by 20% to 0.47% while return on average equity (ROAE) decreased by 5% to 3.68% compared to 0.39% and 3.89%, respectively, for 2017. The decrease in ROAE is due to the increase in shares outstanding from the capital raise in February 2018.
  • Loans grew 14% compared to end of year 2017, finishing the quarter at $104.8 million.
  • Total deposits increased by $22 million or 20% to $128 million, compared to $107 million for 2017.
  • The Bank’s capital ratios exceeded the regulatory guidelines for a well-capitalized financial institution under current regulatory requirement.

Willamette Community Bank serves its customers from three offices located in Albany, Lebanon and Salem.

This document includes forward-looking information, which is subject to the “safe harbor” created by Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act and the Private Securities Litigation Reform Act of 1995. When the Bank uses or incorporates by reference in this letter the words “anticipate,” “estimate,” “expect,” “project,” “intend,” “commit,” “believe” and similar expressions, the Company intends to identify forward-looking statements. Our actual results may differ materially from those projected in any forward-looking statements, as they will depend on many factors about which we are unsure, including many factors which are beyond our control.

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