Plaza Bank posts quarterly profit of $669,000

Plaza Bank improved its earnings in the second quarter.

The business bank with branch each in Las Vegas and Irvine, Calif., posted net income of $669,000, up from $220,000 in the first quarter.

The results continued an upward trend. The bank reported a loss of $156,000 in the second quarter of 2010.

Gene Galloway, president and chief executive officer of Plaza Bank, attributed the rise in net income to a 68.6 percent, or $4 million, gain in interest income during the second quarter. Loan volume for the first six months of 2011 was $54.8 million, a $4.2 million or 8.3 increase, from last year.

"I think the worst is behind us," Galloway said Thursday. "Is the economy going to recover like rocket going straight up, probably not? We still got work to do."

Second-quarter noninterest income of $1.3 million includes a gain on loan sales of $985,000. Plaza Bank reported gain on loan sales increased by $474,000 and $716,000 over the first quarter and the second quarter of 2011, respectively.

Net interest margin was 4.19 percent for the quarter, a 49 basis-point increase from 2010's second quarter.

Galloway said the bank's Irvine, Calif., branch continues to benefit from robust loan growth.

"In Las Vegas, we've seen strong deposit growth" he said. "We are beginning to see a turnabout in our loan growth."

Galloway said there were surprise pockets of loan strength in Las Vegas, including manufacturing and distribution that the bank was tapping.

"Las Vegas was a tough market when we bought the branch about a year ago," he said.

In July 2010, Plaza Bank acquired SouthwestUSA Bank, which had been seized by the Federal Deposit Insurance Corp. SouthwestUSA's failure was estimated to cost the FDIC's deposit insurance fund $74.1 million.

The purchase was estimated to increase Plaza Bank's assets to $409 million and deposits to $323 million.

"The bank continues to enhance its overall market presence in both Southern California and Southern Nevada," said Tom Rodgers, chairman of Plaza Bank's board of directors.

Galloway agreed, adding that Plaza Bank would be open to additional acquisition opportunities in Southern California and Nevada.

Contact reporter Chris Sieroty at
csieroty@reviewjournal.com or 702-477-3893.