Grandpoint Capital : January 25, 2018 - Grandpoint Capital, Inc., Reports Year-end 2017 Earnings

Grandpoint Capital, Inc., Reports Year-End 2017 Earnings

Los Angeles, January 25, 2018 - Grandpoint Capital, Inc., the holding company for Grandpoint Bank and its divisions, Bank of Tucson, Regents Bank and The Biltmore Bank of Arizona, reported net income of $24.4 million for the year ended December 31, 2017. Total assets at December 31, 2017, were $3.2 billion. In addition, the board of directors declared its ninth consecutive quarterly cash dividend. The cash dividend of $0.15 per share will be payable on or about February 14, 2018, to shareholders of record as of January 31, 2018.

"We had a strong year in 2017 as we continued to build our business at a sustainable, measured pace," said Don M. Griffith, Chairman and CEO of Grandpoint Capital, Inc., and Grandpoint Bank. "We saw substantial growth in our core deposits, which speaks to the strength of our long-standing client relationships, and we continued to operate a very safe bank, building our balance sheet with quality assets.

"During the fourth quarter 2017, we had several nonrecurring items that reduced our tangible book value, capital ratios and earnings," said Griffith. "In November, we declared a one-time special dividend of $1.25 per share, and in December, we had to charge off $6.6 million of our deferred tax assets to reflect the reduction in federal income tax rates on corporations. In spite of these major adjustments, we still achieved a return on average assets of 0.76% and a return on average tangible equity of 7.52%, and we reported basic earnings per share of $0.74 and tangible book value per share of $8.75." The lower federal tax rate will increase earnings by almost 20% in 2018 and beyond.

At December 31, 2017, deposits totaled $2.4 billion of which 46% is comprised of non-interest-bearing deposits. During 2017, we focused on developing a more liquid and stable deposit base by replacing non-core high-cost money market accounts with core business demand deposit relationships.

Total loans were $2.4 billion, and asset quality remained strong during the quarter as the Bank continued to maintain a prudent and disciplined risk strategy. Grandpoint Bank's capital ratios remain in excess of the regulatory minimums, with a Leverage Ratio of 9.18% and Total Risk-Based Capital Ratio of 11.30% at December 31, 2017.

In December 2017, Grandpoint Bank received a superior 5-star rating from independent rating and research firm BauerFinancial for the eighteenth consecutive quarter. The latest rating was based on September 30, 2017, financial data. The 5-star rating, for strength, stability and soundness, is only awarded to the nation's strongest banks.

Grandpoint Capital, Inc. and Grandpoint Bank are headquartered in Los Angeles. Calif. Grandpoint Bank and its divisions operate in southern California, Arizona and Vancouver, Wash.

More information about Grandpoint is available atwww.grandpointbank.com.

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Contact: Penny Maines, Grandpoint Bank, 213-542-2716,[e-mail]

Grandpoint Capital, Inc. and Subsidiaries Consolidated Balance Sheets

Dollars in $1,000's

Cash and due from banks Interest-bearing deposits in banksInvestment Securities Loans:

Cash and Cash Equivalents

Construction

Single family residential Multifamily loans Commercial real estate Commercial and industrial Consumer

Total Loans

Deferred loan fees, costs and discounts Allowance for loan losses

Goodwill

Core deposit and other intangibles Deferred Tax Assets

Other assets

Deposits:

Demand deposits NOW accounts

Money market accounts Savings accounts

Time deposits

Other liabilities Other Borrowings Subordinated debenture payable Shareholders' Equity:

Common stock, par value Additional Paid-In CapitalNet LoansTotal AssetsTotal Deposits

Unrealized gain (loss) on investment securities Retained earnings (deficit)

Total Grandpoint Capital Shareholders' Equity Noncontrolling interest

Total Shareholders' Equity

Total Liabilities and Shareholders' EquityTangible book value

Shares outstanding Book value per share Tangible book value per share

June 30, 2010

December 31,2010

2011

2012

2013

2014

$

• 3,501 $ 72,825 76,326 3,284

• 27,791 $ 33,604 61,395 97,399

• 22,324 $ 127,803 150,127 208,939

• 43,714 $ 291,545 335,259 318,501

• 41,177 $ 171,408 212,585 230,591

• 37,688 $ 314,005 351,693 266,479

481 -

18,327

20,324

54,315

79,588

110,286

32,753

86,257

193,913

248,727

281,678

2,513

26,097

60,718

135,966

215,956

397,712

7,792

248,343

429,224

738,540

777,875

814,430

2,005 -

83,847

136,492

295,199

371,341

375,607

3,673

6,226

21,984

23,289

12,846

12,791

413,040

739,241

1,439,917

1,716,776

1,992,559

(137)

(13,861)

(15,580)

(25,373)

(18,410)

(4,543)

-

(1,050)

(5,722)

(8,867)

(12,087)

(14,018)

12,654

398,129

717,939

1,405,677

1,686,279

1,973,998

2,563

17,923

37,863

51,432

53,101

53,323

133 -

2,724

6,857

11,822

12,765

11,063

4,056

12,011

30,997

30,981

30,206

2,981

19,005

24,959

50,195

48,987

79,210

$

97,941

$

600,631

$

1,158,695

$

2,203,883

$

2,275,289

$

2,765,972

$

• 3,664 $

547

• 136,024 $

22,651

• 327,638 $

57,302

• 736,831 $

88,994

• 764,936 $ 132,743

  • 792,896 $ 136,003

  7,984

  246,043

  473,107

  723,125

• 689,318 1,029,519

1,353

5,618

78,353

4,703

112,407

9,403

298,226

20,587

36,914 313,788

35,505 411,908

19,166 2,840 - -487,774 10,400 - 5,155

979,857 14,084 3,000 5,155

1,867,763 18,596 10,500 5,155

• 1,937,699 2,405,831

2015

2016

2017

• 25,113 $ 171,625 196,738 573,260

28,919 $ 32,238

213,365 151,556

242,284 183,794

579,275 502,615

130,801

194,471 137,165

269,823

220,519 171,360

599,470

715,786 719,698

862,014

905,534 946,072

412,051

322,419 345,475

9,138

7,876 43,712

2,283,297

(17,245)

3,550

2,366,605 3,199 (18,552)

2,363,482 65 (18,939)

2,269,602

2,351,252 2,344,608

53,323

53,323 53,323

9,209

7,493 5,865

24,749

23,818 15,686

70,107

69,491 88,043

$

3,196,988

$

3,326,936

$

3,193,934

• 852,263 $

926,594 $

1,090,900

139,660

148,071 145,591

1,165,748

1,106,229 843,920

39,979

47,426 44,837

348,068

347,775 251,681

15,496 11,000 5,155

27,233 - 5,155

2,545,718 10,594 275,000 5,155

2,576,095 12,696

2,376,929 12,353

350,000 450,000

5,155 5,155

95

116

181

323

324

324

329

330 332

88,729

108,628

171,236

306,060

308,882

310,860

316,623

318,904 320,935

23

(52)

150

1,410

(3,756)

(1,090)

(3,834)

(1,009) (646)

(12,912)

(16,073)

(21,233)

(5,924)

489

17,659

47,403

64,765 28,876

75,935 -

75,935

92,619

97,302

4,683

150,334

156,599

6,265

301,869 -

301,869

305,939 -

305,939

327,753 -

327,753

360,521 -

360,521

382,990 - 382,990

349,497 - 349,497

$

97,941

$

600,631

$

1,158,695

$

2,203,883

$

2,275,289

$

2,765,972

$

3,196,988

$

3,326,936

$

3,193,934

• $ 73,239 9,543,057

• $ 76,655 11,660,098

• $ 107,764 18,183,867

• $ 238,615 32,353,019

• $ 240,073 32,424,261

• $ 263,367 32,445,179

• $ 297,989 32,894,185

• $ 322,174 33,022,742

• $ 290,309 33,174,924

  $ $

  7.96 7.67

  $ $

  7.94 6.57

  $ $

  8.27 5.93

  $ $

  9.33 7.38

  $ $

  9.44 7.40

  $ $

  10.10 8.12

  $ $

  10.96 9.06

  $ $

  11.60 9.76

• $ 10.53

• $ 8.75

Grandpoint Capital, Inc. and Subsidiaries Consolidated Income Statements Dollars in $1,000's

Interest Income Interest ExpenseNet Interest IncomeProvision for Loan Losses Noninterest IncomeNoninterest Expense:

Salaries and Benefits Occupancy Expenses

Furniture and Equipment Expenses Promotion Expenses

Data Processing Expenses Professional Services

M&A, Conversion and Restructuring Costs Office Supplies and Costs

Assessments and Insurance Loan Expenses

Other Expenses

Income before Income TaxesYear Ended December 31,2010

2011

2012

2013

2014

2015

2016

2017

$

• 2,117 $ 204 1,913

• 44,715 $ 4,174 40,541 6,046 4,726

• 69,166 $ 4,109 65,057 5,494 8,074

• 93,618 $ 4,248

• 102,882 $ 4,826

• 114,714 $ 5,883 108,831

123,511 $ 128,367

8,256 12,242

89,370

98,056

115,255 116,125

1,050 5,927

3,799 7,061

4,317 6,049

3,732 6,660

1,135 335

5,946 7,955

6,898

22,343

34,891

44,292

40,270

38,719

40,462 47,406

1,021

3,102

4,591

5,380

5,569

5,186

5,405 5,439

883

2,077

2,991

3,352

3,610

3,288

3,283 3,435

738

1,178

1,385

1,941

1,620

1,217

1,292 1,358

307

1,264

2,020

2,580

1,862

1,908

2,015 2,120

1,292

2,826

3,820

4,263

2,406

2,709 -

2,683 3,105

2,346

5,984

947

10,304

3,988

300 236

293

787

1,284

1,481

1,755

1,422

1,358 1,390

215

1,428 -

1,880

2,195

2,377

2,464

2,388 1,859

-

1,785

1,703

3,108

1,849

1,499 1,227

259

3,104

2,924

4,400

4,239

3,889

3,909 4,055

14,252

44,093

58,518 9,119 (6,316)

81,891

70,804

62,651 49,108 19,364

64,594 71,630

(7,462)

(4,872)

10,741 4,328

28,984 11,814

55,472 52,115

Income Taxes

(374)

-

22,286 27,673

Net Income

(7,088)

(4,872)

15,435

• 6,413 $

17,170

$

• 29,744 $

  33,186 $ 24,442

  EPS - basic ROAA ROATE Efficiency Ratio

  $

  • (1.19) $ -2.36% -11.29% 181.79%

  • (0.35) $ -0.53% -4.08% 97.41%

  • 0.61 $ 0.96% 6.82% 80.02%

  • 0.20 $ 0.29% 2.10% 84.92%

  • 0.53 $ 0.70% 5.24% 68.01%

• 0.91 $ 1.00% 10.52% 54.25%

1.01 $ 0.74

1.03% 0.76%

10.71% 7.52%

53.29% 57.73%