Plaza Bank on Thursday reported third-quarter earnings that jumped 62 percent year-over-year.
The community bank, with branches in Las Vegas and Irvine, Calif., said net income for the quarter was $1.38 million, or 8 cents per share, a substantial increase from the $860,000, or 5 cents per share, from the same period last year.
“Our surge in net income is being driven by the … $56 million increase in loans held for investment since the beginning of the year,” Gene Galloway, president and CEO of Plaza Bank, said. “The increase in loans has pushed our loan interest income up $4 million compared to the first three quarters of 2012.”
Galloway said the bank’s cost of deposits was down $206,000 year to date even those deposits have increased $51 million. The acquisition of 1st Commerce Bank in North Las Vegas generated a $624,000 gain for the bank.
Plaza Bank reported $524,000 of the gain was recognized in the third quarter. The bank acquired the deposits and bought the assets of the failed financial institution from the Federal Deposit Insurance Corp.
The FDIC seized 1st Commerce Bank, with one office and about $20.2 million in assets and $19.6 million in deposits as of March 31. In addition, Plaza Bank and the FDIC agreed to share losses on $122.2 million of 1st Commerce Bank loans and other assets.
“We picked up some pretty nice accounts,” Galloway said. “It was only a $20 million deal, with $18 million remaining. So we’ve kept the bulk of the clients. We appreciate that.”
The acquisition of 1st Commerce Bank hasn’t affected loan growth. Loan volume for the thirds quarter was $43.8 million, while loans held for investment totaled $383.4 million.
During the quarter, Plaza Bank sold $12.8 million of SBA 7A loans that generated $682,000 in gains. For the first nine months of 2013, the bank parted ways with $38.7 million o SBA 7A loans that generated $2.6 million in gains.
As of Sept. 30, Plaza Bank reported assets of $473.6 million. “We are going to have a very good fourth quarter,” Galloway said.
Comparing the two regional economies, Galloway said Southern California is experiencing “much stronger consumer demand” than Southern Nevada. He said Nevada “is still slowly improving.”
“All the indicators are looking good, but Nevada had a bigger hole to climb out of,” Galloway said Thursday.
Plaza Bank is part of the Carpenter Community Bancfund portfolio the private equity arm of Irvine, Calif-based Carpenter & Co.
Contact reporter Chris Sieroty at email@example.com or 702-477-3893. Follow @sierotyfeatures on Twitter.