Classified in: Business, Covid-19 virus
Subject: EARNINGS

Record Net Income From Robust SBA PPP Program

AMERICAN BUSINESS BANK (OTCQX: AMBZ) today reported net income of $7.9 million or $0.97 per fully diluted share for the third quarter of 2020 compared to $5.4 million or $0.67 per fully diluted share for the third quarter of 2019 primarily due to increased net interest income as a result of PPP loans outstanding during the quarter.

"While the pandemic creates near-term uncertainty, we are more confident for the future based upon the general return to profitability of our outstanding customer base during the quarter. Our business development efforts have also been successful as prospects heard of our significant participation in the PPP program resulting in loan and deposit growth this quarter and a solid pipeline of new relationships. While we are watching credit quality closely, the vast majority of our portfolio is well managed by our competent business owners who are taking the necessary steps as needed to generate positive returns in this challenging time. Thus, we anticipate continued strong credit metrics reflective of our prudent approach in the evaluation of clients and prospects.

"We remain committed to supporting the needs of our business community, as well as providing for the safety of our employees who continue to provide the same excellent responsiveness to customers despite the changed environment. Additionally, we are assisting our clients with a highly regarded accounting firm to ensure they meet the SBA requirements to maximize PPP loan forgiveness. As PPP loans payoff, the Bank stands to earn a noteworthy amount of fees to offset the effects of the unprecedented low interest rate environment," said Leon Blankstein, ABB's President, CEO and Director.

For the quarter ending September 30, 2020, net income was $7.9 million or $0.97 per fully diluted share, compared to net income of $6.7 million or $0.83 per fully diluted share for the second quarter of 2020. Net interest income for the third quarter was $23.4 million, a 7% increase over the second quarter of 2020 as interest and net deferred fee amortization on PPP loans increased by $843,000. This was partially offset by lower rates on non-PPP loans. For the quarter ending September 30, 2020, the cost of deposits was 0.07%, representing a 0.01% decline from the second quarter of 2020. Additionally, interest income on the securities portfolio increased by $1 million in the third quarter of 2020 compared to the second quarter of 2020 as excess liquidity was deployed into investment securities during the quarter. For the quarter ending September 30, 2020, the provision for loan losses was $450,000. The allowance for loan losses as a percentage of loans, excluding PPP loans, was 1.54% at September 30, 2020 and June 30, 2020.

Net income was $19.4 million or $2.40 per fully diluted share for the nine months ended September 30, 2020, compared to $16.1 million or $1.99 per fully diluted share for the nine months ended September 30, 2019. The increase was primarily due to loan growth of 52% between periods, partially offset by a lower interest earning asset yield resulting in increased net interest income.

Net Interest Margin

Net interest margin for the third quarter of 2020 was 2.89% compared to 2.88% for the second quarter of 2020 and 3.66% for the third quarter of 2019. Excluding the impact of PPP loans, the net interest margin was 3.06% for the third quarter of 2020 and 3.02% for the second quarter of 2020. The reduction in the net interest margin compared to the prior year is due to lower market interest rates and the impact of PPP loans. As of September 30, 2020, approximately 42% of the Bank's variable-rate loans are indexed to prime and 71% of these loans are at or above interest rate floors.

Net Interest Income

Net interest income increased for the third quarter of 2020 compared to the third quarter of 2019 by $3.1 million, or 15.5%, and compared to the second quarter of 2020 by $1.6 million, or 7.4%. This was primarily due to an increase in average outstanding loans offset by lower yields on loans for the periods compared. Included in interest income for the third quarter of 2020 is the accretion of net deferred processing PPP loan fees of $2.1 million compared to $1.5 million in the second quarter of 2020. The Bank's core funding continues to be a strength with the cost of deposits at 0.07% for the third quarter of 2020 compared to 0.24% for same period a year ago.

On a year-to-date basis, net interest income was $65.1 million for the nine months ended September 30, 2020, compared to $58.1 million for the same period a year ago. The 12% increase was primarily due to significant loan growth between periods, partially offset by a lower net interest margin.

Non Interest Income

Non-interest income in the third quarter of 2020 was $1.4 million, representing a decrease of $362,000 or 20% compared to the second quarter of 2020 and an increase of $101,000, or 8% from the quarter a year ago. This was primarily due to a change in Bank/Corporate owned life insurance income, which is driven by the increase/decrease in the value of the policies that are invested in mutual funds.

On a year-to-date basis, Deposit Fees increased $334,000 from the period a year ago due to growth in commercial business customers and lower earnings credit. Non-interest income decreased as a result of a decline in gains on sale of SBA loans. Since mid-2019, the Bank has added most SBA loan originations to its loan portfolio. For the second and third quarter of 2020, International Fees declined due to the impact of the pandemic.

Non Interest Expense

Non-interest expense increased $929,000 for the quarter ended September 30, 2020 compared to the same quarter a year ago. The increase was primarily due to a $1 million increase in salaries and employee benefits. This is due to higher expenses related to the deferred compensation plan (DCP) as a result of the market performance of DCP investment balances, higher base salaries, and $117,000 of severance costs associated with a reduction in work force near the end of the third quarter. The efficiency ratio declined to 55% for the third quarter of 2020 compared to 59% for the third quarter of 2019.

For the third quarter of 2020, total non-interest expense decreased $287,000 compared to the second quarter of 2020. For the quarter, other non-interest expense declined $376,000 primarily due to a reduction in the reserve for off balance sheet commitments of $705,000. This was offset by an increase in the FDIC assessment of $291,000 associated with increased assets. The efficiency ratio declined to 55% for the third quarter of 2020 compared to 59% for the second quarter of 2020.

For the nine months ending September 30, 2020, total non-interest expense increased $1.6 million or 4% compared to the same period a year ago, primarily due to increased salaries and employee benefits, and other expense. The efficiency ratio was 57% and 61% for the nine months ended September 30, 2020 and 2019, respectively.

Full time equivalent employees at September 30, 2020 were 193 compared to 195 a year ago, and the same as June 30, 2020. For 2020, the average number of fulltime equivalent employees has increased by four. The Bank has 32 relationship managers in seven offices, an increase over year end and the prior quarter.

Balance Sheet

From December 31, 2019 to September 30, 2020, total assets increased $919 million, or 38%, to $3.3 billion, with 75% of the increase attributable to PPP loan originations. Total loans, excluding PPP loans, increased $281,000, to $1.49 billion from year-end as C&I line utilization declined significantly. At September 30, 2020 and June 30, 2020 the utilization rate for the Bank's commercial lines of credit was 27% compared to 35% at December 31, 2019.

The Bank purchased $186 million of municipal and U.S. Agency mortgage-backed securities during the third quarter with an estimated weighted average yield of 1.74%. The duration of the securities portfolio increased from 2.3 to 2.8 years from September 30, 2019 to September 30, 2020.

During the first nine months of 2020, total deposits grew by $884 million with a majority of the increase attributable to the proceeds of PPP loans. This increase was also due to new deposit relationships of approximately $200 million and existing customers maintaining higher liquidity as the economy slowed. At September 30, 2020, the tangible common equity ratio was 7.11%; excluding PPP loans, the tangible common equity ratio was 8.95%.

Asset Quality

At June 30, 2020 and September 30, 2020 non-performing assets totaled $2.8 million, representing 0.11% of total assets (excluding PPP loans) at September 30, 2020. The Bank continues to have no Other Real Estate Owned. Excluding PPP loans, loans that were past due, criticized and classifieds represented 0.07%, 8.56%, and 1.32%, respectively of total loans at September 30, 2020 compared to 0.26%, 6.55% and 1.22%, respectively of total loans at June 30, 2020. As of September 30, 2020, the allowance for loan losses stood at $22.9 million, or 1.54% of total loans (excluding PPP loans); compared to 1.4% at December 31, 2019. All PPP loans are 100% guaranteed by the SBA and as such, no allowance for loan losses is allocated to these loans. The Bank is required to adopt CECL, or Current Expected Credit Loss, on January 1, 2023. For the first nine months of 2020, the Bank recorded a total of $478,000 in net charge-offs on two commercial loans, representing annualized net charge offs of 0.03%. The Bank had no charge-offs in the third quarter of 2020.

In response to the COVID-19 pandemic, the Bank established a loan payment deferment program to assist its customers who are experiencing short-term financial or operational problems. As of September 30, 2020, there were six loans with a total principal balance of $19.8 million (0.9% of total loans) on a loan payment deferment program of which $7.8 million of loans previously granted a deferral received a second modification. At the time of origination, the loans currently granted deferrals were underwritten with a 56% average loan-to-value ratio. These loans are all backed by commercial real estate of which 79% are owner occupied. All payment deferrals granted to-date meet applicable requirements to continue accruing interest. As of September 30, 2020, 79% of clients whose first deferral concluded during the quarter resumed their scheduled payments.

ABOUT AMERICAN BUSINESS BANK

American Business Bank, headquartered in downtown Los Angeles, offers a wide range of financial services to the business marketplace. Clients include wholesalers, manufacturers, service businesses, professionals and non-profits. American Business Bank has six Loan Production Offices in strategic locations including: North Orange County in Anaheim, Orange County in Irvine, South Bay in Torrance, San Fernando Valley in Woodland Hills, Riverside County in Corona and Inland Empire in Ontario.

FORWARD LOOKING STATEMENTS

This communication contains certain forward-looking information about American Business Bank that is intended to be covered by the safe harbor for "forward-looking statements" provided by the Private Securities Litigation Reform Act of 1995. Such statements include future financial and operating results, expectations, intentions and other statements that are not historical facts. Such statements are based on information available at the time of this communication and are based on current beliefs and expectations of the Bank's management and are subject to significant risks, uncertainties and contingencies, many of which are beyond our control. The COVID-19 pandemic is adversely affecting the national economy; the ultimate length and severity of its impact on the Bank's customers are uncertain. Actual results may differ materially from those set forth in the forward-looking statements due to a variety of factors, including various risk factors. We are under no obligation (and expressly disclaim any such obligation) to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

American Business Bank
Figures in $000, except share and per share amounts

BALANCE SHEETS (unaudited)



					September			June			December			September
					2020			2020			2019			2019
Assets:
	Cash and Due from Banks				$	69,786		$	68,072		$	31,673		$	88,211
	Interest Earning Deposits in Other Financial Institutions					64,660			232,770			45,202			26,077

	Investment Securities:
		US Agencies				230,637			240,012			284,032			305,572
		Mortgage Backed Securities				359,974			313,119			292,126			226,338
		State and Municipals				243,933			133,128			78,520			74,824
		US Treasuries				10,044			10,081			10,009			9,992
		Corporate Bonds				12,480			19,502			19,805			19,861
			Securities Available-for-Sale, at Fair Value			857,068			715,842			684,492			636,587
		State and Municipals Securities Held-to-Maturity, at Amortized Cost				91,717			86,289			86,707			86,915
		Federal Home Loan Bank Stock, at Cost				10,864			10,864			10,356			10,356
			Total Investment Securities			959,649			812,995			781,555			733,858
	Loans Receivable:
		Commercial Real Estate				1,047,100			1,007,655			982,070			954,424
		Commercial and Industrial				362,258			370,786			423,868			402,167
		SBA Payroll Protection Program				688,336			675,666			-			-
		Residential Real Estate				74,170			71,112			76,481			68,259
		Installment and Other				4,131			6,039			4,959			4,765
			Total Loans Receivable			2,175,995			2,131,258			1,487,378			1,429,615
				Allowance for Loan Losses		(22,910	)		(22,399	)		(20,824	)		(20,014	)
			Loans Receivable, Net			2,153,085			2,108,859			1,466,554			1,409,601
	Furniture, Equipment and Leasehold Improvements, Net					8,145			8,520			9,023			8,700
	Bank/Corporate Owned Life Insurance					27,013			26,651			26,448			26,110
	Other Assets					39,041			37,396			41,456			39,087
		Total Assets			$	3,321,379		$	3,295,263		$	2,401,911		$	2,331,644

Liabilities:
	Non-Interest Bearing Demand Deposits				$	1,658,673		$	1,684,662		$	1,083,705		$	1,084,152
	Interest Bearing Transaction Accounts					228,585			204,133			215,730			221,196
	Money Market and Savings Deposits					1,124,329			1,100,191			827,713			751,415
	Certificates of Deposit					36,981			35,713			37,712			42,555
			Total Deposits			3,048,568			3,024,699			2,164,860			2,099,318
	Federal Home Loan Bank Advances / Other Borrowings					-			-			-			-
	Other Liabilities					36,822			43,206			30,386			31,258
		Total Liabilities			$	3,085,390		$	3,067,905		$	2,195,246		$	2,130,576

Shareholders' Equity:
	Common Stock				$	165,789		$	165,032		$	163,872		$	163,464
	Retained Earnings					66,233			58,359			46,784			40,795
	Accumulated Other Comprehensive Income / (Loss)					3,967			3,967			(3,991	)		(3,191	)
		Total Shareholders' Equity			$	235,989		$	227,358		$	206,665		$	201,068
		Total Liabilities and Shareholders' Equity			$	3,321,379		$	3,295,263		$	2,401,911		$	2,331,644

	Standby Letters of Credit				$	35,131		$	37,259		$	39,513		$	39,722

Per Share Information:
	Common Shares Outstanding					7,926,833			7,904,105			7,850,171			7,834,279
	Book Value Per Share				$	29.77		$	28.76		$	26.33		$	25.67
	Tangible Book Value Per Share				$	29.77		$	28.76		$	26.33		$	25.67

American Business Bank
Figures in $000, except share and per share amounts

INCOME STATEMENTS (unaudited)


			For the three months ended:
			September			June			September
			2020			2020			2019
Interest Income:
	Interest and Fees on Loans		$	19,793		$	19,169		$	16,890
	Interest on Investment Securities			4,048			3,084			4,260
	Interest on Interest Earning Deposits
		in Other Financial Institutions		71			93			332
		Total Interest Income		23,912			22,346			21,482

Interest Expense:
	Interest on Interest Bearing Transaction Accounts			41			37			152
	Interest on Money Market and Savings Deposits			499			538			1,041
	Interest on Certificates of Deposits			21			28			73
	Interest on Federal Home Loan Bank Advances
		and Other Borrowings		-			-			1
		Total Interest Expense		561			603			1,267

Net Interest Income				23,351			21,743			20,215
	Provision for Loan Losses			450			680			1,460
Net Interest Income after Provision for Loan Losses				22,901			21,063			18,755

Non-Interest Income:
	Deposit Fees			677			640			553
	International Fees			237			244			328
	Gain (Loss) on Sale of Investment Securities, Net			(32	)		(184	)		(122	)
	Gain on Sale of SBA Loans, Net			-			-			87
	Bank/Corporate Owned Life Insurance Income (Expense)			361			953			135
	Other			191			143			352
		Total Non-Interest Income		1,434			1,796			1,333

Non-Interest Expense:
	Salaries and Employee Benefits			9,494			9,384			8,444
	Occupancy and Equipment			966			953			888
	Professional Services			1,663			1,627			1,946
	Promotion Expenses			197			267			361
	Other			1,317			1,693			1,069
		Total Non-Interest Expense		13,637			13,924			12,708

Earnings before income taxes				10,698			8,935			7,380
	Income Tax Expense			2,824			2,200			1,963

NET INCOME			$	7,874		$	6,735		$	5,417
Add back:
	After-Tax Gain (Loss) on Sale of Investment Securities, Net		$	23		$	139		$	90
	After-Tax DCP ABB Stock Expense (Benefit)		$	-		$	-		$	-
Core Net Income			$	7,897		$	6,874		$	5,507

Per Share Information:
	Earnings Per Share - Basic		$	0.98		$	0.84		$	0.68

	Earnings Per Share - Diluted		$	0.97		$	0.83		$	0.67
	Core Earnings Per Share - Diluted		$	0.97		$	0.85		$	0.68

	Weighted Average Shares - Basic			8,070,598			8,046,122			7,999,146

	Weighted Average Shares - Diluted			8,109,487			8,097,354			8,100,992

American Business Bank
Figures in $000, except share and per share amounts

INCOME STATEMENTS (unaudited)


			For the nine months ended:
			September			September
			2020			2019
Interest Income:
	Interest and Fees on Loans		$	56,257		$	47,813
	Interest on Investment Securities			11,045			12,678
	Interest on Interest Earning Deposits
		in Other Financial Institutions		217			1,098
		Total Interest Income		67,519			61,589

Interest Expense:
	Interest on Interest Bearing Transaction Accounts			182			363
	Interest on Money Market and Savings Deposits			2,004			2,804
	Interest on Certificates of Deposits			90			293
	Interest on Federal Home Loan Bank Advances
		and Other Borrowings		131			15
		Total Interest Expense		2,407			3,475

Net Interest Income				65,112			58,114
	Provision for Loan Losses			2,564			2,478
Net Interest Income after Provision for Loan Losses				62,548			55,636

Non-Interest Income:
	Deposit Fees			1,932			1,598
	International Fees			763			841
	Gain (Loss) on Sale of Investment Securities, Net			(168	)		(267	)
	Gain on Sale of SBA Loans, Net			19			327
	Bank/Corporate Owned Life Insurance Income (Expense)			564			782
	Other			532			866
		Total Non-Interest Income		3,642			4,147

Non-Interest Expense:
	Salaries and Employee Benefits			27,097			26,461
	Occupancy and Equipment			2,839			2,956
	Professional Services			4,772			4,340
	Promotion Expenses			830			946
	Other			4,070			3,324
		Total Non-Interest Expense		39,608			38,027

Earnings before income taxes				26,582			21,756
	Income Tax Expense			7,134			5,668

NET INCOME			$	19,448		$	16,088
Add back:
	After-Tax Gain (Loss) on Sale of Investment Securities, Net		$	123		$	198
	After-Tax DCP ABB Stock Expense (Benefit)		$	-		$	449
Core Net Income			$	19,571		$	16,735

Per Share Information:
	Earnings Per Share - Basic		$	2.42		$	2.02

	Earnings Per Share - Diluted		$	2.40		$	1.99
	Core Earnings Per Share - Diluted		$	2.41		$	2.07

	Weighted Average Shares - Basic			8,050,992			7,948,632

	Weighted Average Shares - Diluted			8,109,732			8,078,529

American Business Bank
Figures in $000

QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)


				For the three months ended:
				September 2020						June 2020
				Average		Interest		Average		Average		Interest		Average
				Balance		Inc/Exp		Yield/Rate		Balance		Inc/Exp		Yield/Rate
Interest Earning Assets:
	Interest Earning Deposits in Other Financial Institutions			$	191,948	$	71	0.15	%	$	264,722	$	93	0.14	%

	Investment Securities:
		US Agencies			237,419		429	0.72	%		260,033		270	0.41	%
		Mortgage Backed Securities			325,904		1,541	1.89	%		271,173		1,434	2.12	%
		State and Municipals			271,133		1,700	2.51	%		174,950		1,196	2.73	%
		US Treasuries			10,011		37	1.46	%		10,018		37	1.48	%
		Corporate Bonds			16,479		126	3.07	%		19,908		147	2.95	%
			Securities Available-for-Sale and Held-to-Maturity		860,946		3,833	1.78	%		736,082		3,084	1.68	%
		Federal Home Loan Bank Stock			10,864		215	7.90	%		10,753		-	0.00	%
			Total Investment Securities		871,810		4,048	1.86	%		746,835		3,084	1.65	%
	Loans Receivable:
		Commercial Real Estate			1,026,594		11,179	4.33	%		1,003,318		11,031	4.42	%
		Commercial and Industrial			364,750		3,987	4.35	%		402,179		4,380	4.38	%
		SBA Payroll Protection Program			683,495		3,837	2.23	%		539,535		2,994	2.23	%
		Residential Real Estate			73,291		734	3.98	%		70,984		705	4.00	%
		Installment and Other			4,817		56	4.65	%		5,037		59	4.75	%
			Total Loans Receivable		2,152,947		19,793	3.66	%		2,021,053		19,169	3.81	%
	Total Interest Earning Assets			$	3,216,705	$	23,912	2.91	%	$	3,032,610	$	22,346	2.91	%

Liabilities:
	Non-Interest Bearing Demand Deposits				1,675,885		-	0.00	%		1,624,250		-	0.00	%
	Interest Bearing Transaction Accounts				215,041		41	0.08	%		201,439		37	0.07	%
	Money Market and Savings Deposits				1,132,664		499	0.18	%		1,027,292		538	0.21	%
	Certificates of Deposit				36,848		21	0.23	%		35,614		28	0.31	%
			Total Deposits		3,060,438		561	0.07	%		2,888,595		603	0.08	%
	Federal Home Loan Bank Advances / Other Borrowings				-		-	0.00	%		-		-	0.00	%
	Total Interest Bearing Deposits and Borrowings				1,384,553		561	0.16	%		1,264,345		603	0.19	%
	Total Deposits and Borrowings			$	3,060,438	$	561	0.07	%	$	2,888,595	$	603	0.08	%

	Net Interest Income					$	23,351					$	21,743
	Net Interest Rate Spread							2.84	%					2.83	%
	Net Interest Margin							2.89	%					2.88	%
	Net Interest Margin, excluding SBA PPP							3.06	%					3.02	%

American Business Bank
Figures in $000

QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)


				For the three months ended:
				September 2020						September 2019
				Average		Interest		Average		Average		Interest		Average
				Balance		Inc/Exp		Yield/Rate		Balance		Inc/Exp		Yield/Rate
Interest Earning Assets:
	Interest Earning Deposits in Other Financial Institutions			$	191,948	$	71	0.15	%	$	58,676	$	332	2.30	%

	Investment Securities:
		US Agencies			237,419		429	0.72	%		351,204		1,406	1.60	%
		Mortgage Backed Securities			325,904		1,541	1.89	%		208,820		1,422	2.72	%
		State and Municipals			271,133		1,700	2.51	%		159,861		1,094	2.74	%
		US Treasuries			10,011		37	1.46	%		10,039		37	1.46	%
		Corporate Bonds			16,479		126	3.07	%		15,328		118	3.07	%
			Securities Available-for-Sale and Held-to-Maturity		860,946		3,833	1.78	%		745,252		4,077	2.19	%
		Federal Home Loan Bank Stock			10,864		215	7.90	%		10,356		183	7.05	%
			Total Investment Securities		871,810		4,048	1.86	%		755,608		4,260	2.25	%
	Loans Receivable:
		Commercial Real Estate			1,026,594		11,179	4.33	%		917,398		10,957	4.74	%
		Commercial and Industrial			364,750		3,987	4.35	%		385,315		4,996	5.14	%
		SBA Payroll Protection Program			683,495		3,837	2.23	%		-		-	0.00	%
		Residential Real Estate			73,291		734	3.98	%		66,512		891	5.32	%
		Installment and Other			4,817		56	4.65	%		5,159		46	3.58	%
			Total Loans Receivable		2,152,947		19,793	3.66	%		1,374,384		16,890	4.88	%
	Total Interest Earning Assets			$	3,216,705	$	23,912	2.91	%	$	2,188,668	$	21,482	3.84	%

Liabilities:
	Non-Interest Bearing Demand Deposits				1,675,885		-	0.00	%		1,059,710		-	0.00	%
	Interest Bearing Transaction Accounts				215,041		41	0.08	%		208,403		152	0.29	%
	Money Market and Savings Deposits				1,132,664		499	0.18	%		746,947		1,041	0.55	%
	Certificates of Deposit				36,848		21	0.23	%		50,425		73	0.57	%
			Total Deposits		3,060,438		561	0.07	%		2,065,485		1,266	0.24	%
	Federal Home Loan Bank Advances / Other Borrowings				-		-	0.00	%		163		1	2.27	%
	Total Interest Bearing Deposits and Borrowings				1,384,553		561	0.16	%		1,005,938		1,267	0.50	%
	Total Deposits and Borrowings			$	3,060,438	$	561	0.07	%	$	2,065,647	$	1,267	0.24	%

	Net Interest Income					$	23,351					$	20,215
	Net Interest Rate Spread							2.84	%					3.60	%
	Net Interest Margin							2.89	%					3.66	%
	Net Interest Margin, excluding SBA PPP							3.06	%					3.66	%

American Business Bank
Figures in $000

YEAR-TO-DATE AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)


				For the nine months ended:
				September 2020						September 2019
				Average		Interest		Average		Average		Interest		Average
				Balance		Inc/Exp		Yield/Rate		Balance		Inc/Exp		Yield/Rate
Interest Earning Assets:
	Interest Earning Deposits with Other Financial Institutions			$	161,520	$	217	0.18	%	$	61,271	$	1,098	2.42	%

	Investment Securities:
		US Agencies			258,359		1,376	0.71	%		395,511		4,612	1.55	%
		Mortgage Backed Securities			294,904		4,718	2.13	%		183,086		3,903	2.84	%
		State and Municipals			203,326		4,018	2.63	%		162,505		3,351	2.75	%
		US Treasuries			10,018		110	1.47	%		10,046		111	1.47	%
		Corporate Bonds			18,770		423	3.00	%		6,732		159	3.15	%
			Securities Available-for-Sale and Held-to-Maturity		785,377		10,645	1.81	%		757,880		12,136	2.14	%
		Federal Home Loan Bank Stock			10,658		400	5.01	%		10,356		542	6.97	%
			Total Investment Securities		796,035		11,045	1.85	%		768,236		12,678	2.20	%
	Loans Receivable:
		Commercial Real Estate			1,011,829		33,553	4.43	%		873,209		30,901	4.73	%
		Commercial and Industrial			400,905		13,391	4.46	%		366,111		14,308	5.23	%
		SBA Payroll Protection Program			408,683		6,832	2.23	%		-		-	0.00	%
		Residential Real Estate			73,525		2,325	4.22	%		62,286		2,487	5.34	%
		Installment and Other			5,166		156	4.04	%		4,949		117	3.17	%
			Total Loans Receivable		1,900,108		56,257	3.95	%		1,306,555		47,813	4.89	%
	Total Interest Earning Assets			$	2,857,663	$	67,519	3.10	%	$	2,136,062	$	61,589	3.80	%

Liabilities:
	Non-Interest Bearing Demand Deposits				1,469,001		-	0.00	%		1,021,107		-	0.00	%
	Interest Bearing Transaction Accounts				206,276		182	0.12	%		201,985		363	0.24	%
	Money Market and Savings Deposits				989,554		2,004	0.27	%		735,682		2,804	0.51	%
	Certificates of Deposit				36,298		90	0.33	%		61,515		293	0.64	%
			Total Deposits		2,701,129		2,276	0.11	%		2,020,289		3,460	0.23	%
	Federal Home Loan Bank Advances / Other Borrowings				10,533		131	1.66	%		738		15	2.63	%
	Total Interest Bearing Deposits and Borrowings				1,242,661		2,407	0.26	%		999,920		3,475	0.46	%
	Total Deposits and Borrowings			$	2,711,662	$	2,407	0.12	%	$	2,021,027	$	3,475	0.23	%

	Net Interest Income					$	65,112					$	58,114
	Net Interest Rate Spread							2.98	%					3.57	%
	Net Interest Margin							3.04	%					3.64	%
	Net Interest Margin, excluding SBA PPP							3.18	%					3.64	%

American Business Bank
Figures in $000

SUPPLEMENTAL DATA (unaudited)



			September			June			December			September
			2020			2020			2019			2019
Performance Ratios:
	Quarterly:
	Return on Average Assets (ROAA)			0.95	%		0.86	%		0.99	%		0.95	%
	Core Return on Average Assets (ROAA)			0.95	%		0.87	%		0.99	%		0.96	%

	Return on Average Equity (ROAE)			13.53	%		12.14	%		11.74	%		11.03	%
	Core Return on Average Equity (ROAE)			13.57	%		12.39	%		11.74	%		11.22	%

	Efficiency Ratio			54.95	%		58.70	%		58.77	%		58.64	%

	Year-to-Date
	Return on Average Assets (ROAA)			0.87	%		0.83	%		0.97	%		0.96	%
	Core Return on Average Assets (ROAA)			0.88	%		0.84	%		1.00	%		1.00	%

	Return on Average Equity (ROAE)			11.67	%		10.68	%		11.80	%		11.83	%
	Core Return on Average Equity (ROAE)			11.75	%		10.77	%		12.15	%		12.30	%

	Efficiency Ratio			57.47	%		58.88	%		60.29	%		60.82	%
	Core Efficiency Ratio			57.47	%		58.88	%		59.57	%		59.84	%

Capital Adequacy:
	Total Risk Based Capital Ratio			14.54	%		14.64	%		13.82	%		13.81	%
	Common Equity Tier 1 Capital Ratio			13.29	%		13.38	%		12.57	%		12.56	%
	Tier 1 Risk Based Capital Ratio			13.29	%		13.38	%		12.57	%		12.56	%
	Tier 1 Leverage Ratio			6.97	%		7.10	%		8.66	%		8.91	%
	Tangible Common Equity / Tangible Assets			7.11	%		6.90	%		8.60	%		8.62	%

Asset Quality Overview
	Non-Performing Loans		$	2,563		$	2,601		$	1,855		$	1,481
	Loans 90+ Days Past Due and Still Accruing			-			-			-			-
		Total Non-Performing Loans		2,563			2,601			1,855			1,481

	Restructured Loans			221			223			227			229

	Other Real Estate Owned			-			-			-			-

	ALLL / Loans Receivable			1.05	%		1.05	%		1.40	%		1.40	%
	Non-Performing Loans / Total Loans Receivable *			0.13	%		0.13	%		0.14	%		0.12	%
	Non-Performing Loans / Total Loans Receivable , excluding PPP *			0.19	%		0.19	%		0.14	%		0.12	%
	Non-Performing Assets / Total Assets *			0.08	%		0.09	%		0.09	%		0.07	%
	Non-Performing Assets / Total Assets , excluding PPP *			0.11	%		0.11	%		0.09	%		0.07	%
	Net Charge-Offs (Recoveries) quarterly		$	(60	)	$	168		$	(8	)	$	(6	)
	Net Charge-Offs (Recoveries) year-to-date		$	478		$	538		$	(41	)	$	(33	)
	Net Charge-Offs (Recoveries) year-to-date / Average			0.03	%		0.03	%		0.00	%		0.00	%
		Loans Receivable

	*	Includes non-accrual loans, accruing loans past due 90+ days and Troubled Debt Restructurings (TDRs).
	**	SBA Paycheck Protection Program (PPP)

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News published on 29 october 2020 at 09:15 and distributed by:

Record Net Income From Robust SBA PPP Program

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