California BanCorp Reports Financial Results for the First Quarter Ended March 31, 2022

OAKLAND, Calif., April 28, 2022 (GLOBE NEWSWIRE) -- California BanCorp (NASDAQ: CALB), whose subsidiary is California Bank of Commerce, announced today its financial results for the first quarter ended March 31, 2022.

The Company reported net income of $3.7 million for the first quarter of 2022, representing an increase of $492,000, or 15%, compared to $3.2 million for the fourth quarter of 2021 and an increase of $864,000, or 31%, compared to $2.8 million in the first quarter of 2021.

Diluted per share earnings of $0.44 for the first quarter of 2022 compared to $0.38 for the fourth quarter of 2021 and $0.34 for the first quarter of 2021.

“We continued to execute well on our strategies to generate profitable growth in the first quarter, leading to positive trends in revenue, net interest margin, and efficiencies, which resulted in a higher level of earnings and returns,” said Steven Shelton, President and CEO of California BanCorp. “We had another strong quarter of loan production that was well balanced across all of our asset classes. Excluding PPP loans and loan sales, we had annualized loan growth of 31% in the first quarter, which enabled us to redeploy more of our excess liquidity into higher yielding earning assets, expand our net interest margin, and generate a higher level of profitability. Our loan pipeline remains strong and we remain well positioned to benefit from further increases in interest rates, which should enable us to continue generating higher levels of revenue, realizing more operating leverage, and continuing to drive profitable growth. While higher interest rates and inflationary pressures create more uncertainty around the operating environment over the remainder of the year, we believe our strong new client acquisition capabilities and value proposition will enable us to continue taking market share, while maintaining healthy asset quality in our well diversified, conservatively underwritten loan portfolio.”

“During the first quarter, we sold approximately $40 million of non-core loans from our solar financing portfolio, which enabled us to monetize the value of these loans, while also shortening the duration of our loan portfolio,” said Thomas A. Sa, Senior Executive Vice President, Chief Financial Officer and Chief Operating Officer of California BanCorp. “In addition, through proactive management of our investment portfolio, we were able to minimize the accounting impact of the increase in interest rates on our tangible book value. During the first quarter, our tangible book value per share increased 3% from the end of the prior quarter due to our strong financial performance.”

Financial Highlights:

Profitability - three months ended March 31, 2022 compared to December 31, 2021

• Net income of $3.7 million and $0.44 per diluted share, compared to $3.2 million and $0.38 per share, respectively.
• Revenue of $17.1 million increased $2.1 million, or 14%, compared to $15.0 million for the fourth quarter of 2021.
• Net fees from Paycheck Protection Program (“PPP”) loans contributed $791,000 to net interest income compared to $708,000 for the fourth quarter of 2021.
• Provision for loan losses of $950,000 increased $446,000, or 88%, primarily as a result of growth in the commercial and real estate other loan portfolios combined with continued adjustments in the qualitative reserve assessment in response to general macroeconomic changes.
• Non-interest income of $2.5 million increased $1.5 million, or 155%, primarily due to a gain recognized on the sale of a portion of our solar loan portfolio.
• Non-interest expense, excluding capitalized loan origination costs, of $11.9 million compared to $11.6 million for the fourth quarter of 2021.

Financial Position – March 31, 2022 compared to December 31, 2021

• Total assets decreased by $155.4 million, or 8%, to $1.86 billion.
• Total gross loans increased by $23.8 million, or 2%, to $1.40 billion. Excluding the impact of PPP loans forgiven by the SBA, total gross loans increased during the first quarter by $59.4 million, or 5%, to $1.36 billion.
• Total deposits decreased by $79.6 million, or 5%, to $1.60 billion.
• Total borrowings decreased by $74.2 million, or 70%, to $32.2 million due to repayment of a short term borrowing as well as borrowings under the Federal Reserve Paycheck Protection Program Liquidity Facility (“PPPLF”).
• Capital ratios remain healthy with a tier-one leverage ratio of 7.84%, tier I capital ratio of 8.63% and total risk-based capital ratio of 12.71%.
  

Net Interest Income and Margin:

Net interest income for the quarter ended March 31, 2022 was $14.5 million, an increase of $559,000 or 4%, from $14.0 million for the three months ended December 31, 2021, and an increase of $1.2 million, or 9%, from $13.3 million for the quarter ended March 31, 2021. The increase in net interest income compared to the fourth quarter of 2021 was primarily attributable to the growth of the loan portfolio combined with a reduction in the average cost of deposits. Compared to the first quarter of 2021, the increase in net interest income resulted from a more favorable mix of earning assets offset, in part, by a reduction in the amortization of net fees received on PPP loans.

The Company’s net interest margin for the first quarter of 2022 was 3.19%, compared to 2.81% for the fourth quarter of 2021 and 2.94% for the same period in 2021. The increase in margin compared to the prior quarter was primarily due to a more favorable mix of earning assets combined with a reduction in the average cost of deposits. The increase in margin from the same period last year was primarily the result of an increase in loan yields resulting from growth in the commercial and real estate other loan portfolios combined with a reduction in the average cost of deposits, partially offset by a reduction of net fees recognized on PPP loans.

Non-Interest Income:

The Company’s non-interest income for the quarters ended March 31, 2022, December 31, 2021, and March 31, 2021 was $2.5 million, $994,000 and $921,000, respectively. The increase in non-interest income compared to the fourth quarter of 2021 and the first quarter of 2021 was primarily due to a gain of $1.4 million recognized on the sale of a portion of our solar loan portfolio.

Net interest income and non-interest income comprised total revenue of $17.1 million, $15.0 million, and $14.3 million for the quarters ended March 31, 2022, December 31, 2021, and March 31, 2021, respectively.

Non-Interest Expense:

The Company’s non-interest expense for the quarters ended March 31, 2022, December 31, 2021, and March 31, 2021 was $10.9 million, $10.0 million, and $10.1 million, respectively. The increase in non-interest expense was primarily due to a reduction in capitalized loan origination costs combined with an increase in salaries and benefits related to investments to support the continued growth of the business and the seasonal impact of higher payroll taxes. Excluding capitalized loan origination costs, non-interest expense for the first quarter of 2022, the fourth quarter of 2021 and the first quarter of 2021 was $11.9 million, $11.6 million, and $11.6 million, respectively.

The Company’s efficiency ratio, the ratio of non-interest expense to revenues, was 63.99%, 66.90%, and 70.70% for the quarters ended March 31, 2022, December 31, 2021, and March 31, 2021, respectively.

Balance Sheet:

Total assets of $1.86 billion as of March 31, 2022, represented a decrease of $155.4 million, or 8%, compared to $2.01 billion at December 31, 2021 and a decrease of $88.0 million, or 5%, compared to $1.95 billion at March 31, 2021. The decrease in total assets from previous quarters was primarily due to decreased liquidity resulting from deposit outflows related to forgiveness of PPP loans combined with a reduction in PPPLF activity.  

Total gross loans increased by $23.8 million, or 2%, to $1.40 billion at March 31, 2022, from $1.38 billion at December 31, 2021 and decreased by $69.8 million, or 5% compared to $1.47 billion at March 31, 2021.

During the first quarter of 2022, commercial and real estate other loans increased by $48.5 million and $44.4 million, respectively, due to organic growth. Partially offsetting these increases within the total loan portfolio, SBA loans decreased by $37.4 million primarily due to PPP loan forgiveness. Additionally, during the first quarter of 2022, the Company sold $39.8 million of residential solar loans.  

Year-over-year, commercial and real estate other loans increased by $83.8 million and $168.1 million, respectively, due to organic growth. These increases were partially offset by a decrease in SBA loans of $320.2 million primarily due to PPP loan forgiveness.

As a result of the CARES Act PPP, which was launched in April 2020 and re-launched in January 2021, the Company funded approximately $491.3 million in loans. Approximately $454.4 million of those balances have been granted forgiveness by the SBA as of March 31, 2022.

Total deposits decreased by $79.6 million, or 5%, to $1.60 billion at March 31, 2022, from $1.68 billion at December 31, 2021 and decreased by $29.2 million, or 2%, from $1.63 billion at March 31, 2021. The decrease in total deposits from the end of the fourth quarter of 2021 was primarily due to a reduction in non-interest bearing demand deposits of $24.5 million, money market and savings deposits of $30.7 million, and time deposits of $23.6 million.

Compared to the same period last year, the decrease in total deposits was primarily concentrated in time deposits as the result of reduced reliance on brokered certificates of deposit. Non-interest bearing deposits, primarily commercial business operating accounts, represented 46.7% of total deposits at March 31, 2022, compared to 45.9% at December 31, 2021 and 45.6% at March 31, 2021.

As of March 31, 2022, the Company had outstanding borrowings, excluding junior subordinated debt securities, of $32.2 million, compared to $106.4 million at December 31, 2021 and $134.8 million at March 31, 2021. The decrease in borrowings during the first quarter of 2022 was comprised primarily of the repayment of a $50.0 million short-term FHLB advance combined with a $24.2 million reduction in PPPLF activity.

Asset Quality:

The provision for credit losses increased to $950,000 for the first quarter of 2022, compared to $504,000 for the fourth quarter of 2021 and $300,000 for the first quarter of 2021. Net loan recoveries in the first quarter of 2022 were $1,000 or 0.00% of gross loans, compared to net recoveries of $6,000, or 0.00%, in the fourth quarter of 2021 and net recoveries of $166,000, or 0.01%, in the first quarter of 2021.

Non-performing assets (“NPAs”) to total assets of 0.03% at March 31, 2022 compared to 0.01% at December 31, 2021 and 0.01% at March 31, 2021, with non-performing loans of $549,000, $232,000 and $234,000, respectively, on those dates.

The allowance for loan losses increased by $951,000 to $15.0 million, or 1.07% of total loans, at March 31, 2022, compared to $14.1 million, or 1.02% of total loans, at December 31, 2021 and $14.6 million, or 0.99% of total loans at March 31, 2021. The increase in the allowance as a percentage of total loans at March 31, 2022 compared to December 31, 2021 and March 31, 2021 reflects an increase in the qualitative reserve assessment in response to general macroeconomic changes pertaining to the mix of our loan portfolio.

Capital Adequacy:

At March 31, 2022, shareholders’ equity totaled $154.6 million compared to $150.8 million at December 31, 2021 and $139.2 million one year ago. As a result, the Company’s total risk-based capital ratio, tier one capital ratio and leverage ratio of 12.49%, 8.49%, and 7.84%, respectively, were all above the regulatory standards for “well-capitalized” institutions of 10.00%, 8.00% and 5.00% respectively.

About California BanCorp:

California BanCorp, the parent company for California Bank of Commerce, offers a broad range of commercial banking services to closely held businesses and professionals located throughout Northern California. The Company’s common stock trades on the Nasdaq Global Select marketplace under the symbol CALB. For more information on California BanCorp, call us at (510) 457-3751, or visit us at www.californiabankofcommerce.com.

Contacts:

Steven E. Shelton, (510) 457-3751
President and Chief Executive Officer
seshelton@bankcbc.com

Thomas A. Sa, (510) 457-3775
Senior Executive Vice President
Chief Financial Officer and Chief Operating Officer
tsa@bankcbc.com

Use of Non-GAAP Financial Information:

This press release contains both financial measures based on GAAP and non-GAAP. Non-GAAP financial measures are used where management believes them to be helpful in understanding the Company’s results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in this press release. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

Forward-Looking Information:

Statements in this news release regarding expectations and beliefs about future financial performance and financial condition, as well as trends in the Company’s business and markets are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements often include words such as "believe," "expect," "anticipate," "intend," "plan," "estimate," "project," "outlook," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may." The forward-looking statements in this news release are based on current information and on assumptions that the Company makes about future events and circumstances that are subject to a number of risks and uncertainties that are often difficult to predict and beyond the Company’s control. As a result of those risks and uncertainties, the Company’s actual financial results in the future could differ, possibly materially, from those expressed in or implied by the forward-looking statements contained in this news release and could cause the Company to make changes to future plans. Those risks and uncertainties include, but are not limited to, the risk of incurring loan losses, which is an inherent risk of the banking business; the risk that the Company will not be able to continue its internal growth rate; the risk that the United States economy will experience slowed growth or recession or will be adversely affected by domestic or international economic conditions and risks associated with the Federal Reserve Board taking actions with respect to interest rates, any of which could adversely affect, among other things, the values of real estate collateral supporting many of the Company’s loans, interest income and interest rate margins and, therefore, the Company’s future operating results; risks associated with changes in income tax laws and regulations; and risks associated with seeking new client relationships and maintaining existing client relationships. Readers of this news release are encouraged to review the additional information regarding these and other risks and uncertainties to which our business is subject that are contained in our Annual Report on Form 10-K for the year ended December 31, 2021 which is on file with the Securities and Exchange Commission (the “SEC”). Additional information will be set forth in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2022, which we expect to file with the SEC during the second quarter of 2022, and readers of this release are urged to review the additional information that will be contained in that report.

The COVID-19 pandemic has created economic and financial disruptions that have adversely affected, and may continue to adversely affect, our business, operations, financial performance and prospects. Even after the COVID-19 pandemic subsides, it is possible that the U.S. and other major economies experience or continue to experience a prolonged recession, which could materially and adversely affect our business, operations, financial performance and prospects. Statements about the effects of the COVID-19 pandemic on our business, operations, financial performance and prospects may constitute forward-looking statements and are subject to the risk that the actual impacts may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond our control, including the scope and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on our customers, third parties and us.

Due to these and other possible uncertainties and risks, readers are cautioned not to place undue reliance on the forward-looking statements contained in this news release, which speak only as of today's date, or to make predictions based solely on historical financial performance. The Company disclaims any obligation to update forward-looking statements contained in this news release, whether as a result of new information, future events or otherwise, except as may be required by law.

FINANCIAL TABLES FOLLOW

CALIFORNIA BANCORP AND SUBSIDIARY
SELECTED FINANCIAL INFORMATION (UNAUDITED) - PROFITABILITY
(Dollars in Thousands, Except Per Share Data)
										Change												Change
QUARTERLY HIGHLIGHTS:		Q1 2022				Q4 2021				$				%				Q1 2021				$				%
Interest income		$	15,924			$	15,543			$	381			2	%			$	15,032			$	892			6	%
Interest expense			1,398				1,576				(178	)		-11	%				1,696				(298	)		-18	%
Net interest income			14,526				13,967				559			4	%				13,336				1,190			9	%
Provision for loan losses			950				504				446			88	%				300				650			217	%
Net interest income after provision for loan losses			13,576				13,463				113			1	%				13,036				540			4	%
Non-interest income			2,534				994				1,540			155	%				921				1,613			175	%
Non-interest expense			10,916				10,009				907			9	%				10,080				836			8	%
Income before income taxes			5,194				4,448				746			17	%				3,877				1,317			34	%
Income tax expense			1,521				1,267				254			20	%				1,068				453			42	%
Net income		$	3,673			$	3,181			$	492			15	%			$	2,809			$	864			31	%
Diluted earnings per share		$	0.44			$	0.38			$	0.06			16	%			$	0.34			$	0.10			29	%
Net interest margin			3.19	%			2.81	%		+38 Basis Points									2.94	%		+25 Basis Points
Efficiency ratio			63.99	%			66.90	%		-291 Basis Points									70.70	%		-671 Basis Points

CALIFORNIA BANCORP AND SUBSIDIARY
SELECTED FINANCIAL INFORMATION (UNAUDITED) - FINANCIAL POSITION
(Dollars in Thousands, Except Per Share Data)
										Change												Change
PERIOD-END HIGHLIGHTS:		Q1 2022				Q4 2021				$				%				Q1 2021				$				%
Total assets		$	1,859,595			$	2,014,996			$	(155,401	)		-8	%			$	1,947,588			$	(87,993	)		-5	%
Gross loans			1,400,474				1,376,649				23,825			2	%				1,470,313				(69,839	)		-5	%
Deposits			1,600,522				1,680,138				(79,616	)		-5	%				1,629,715				(29,193	)		-2	%
Tangible equity			147,068				143,241				3,827			3	%				131,634				15,434			12	%
Tangible book value per share		$	17.78			$	17.33			$	0.45			3	%			$	16.07			$	1.71			11	%
Tangible equity / total assets			7.91	%			7.11	%		+80 Basis Points									6.76	%		+115 Basis Points
Gross loans / total deposits			87.50	%			81.94	%		+556 Basis Points									90.22	%		-272 Basis Points
Noninterest-bearing deposits / total deposits			46.65	%			45.90	%		+75 Basis Points									45.56	%		+109 Basis Points
										Change												Change
QUARTERLY AVERAGE HIGHLIGHTS:		Q1 2022				Q4 2021				$				%				Q1 2021				$				%
Total assets		$	1,928,542			$	2,054,490			$	(125,948	)		-6	%			$	1,922,739			$	5,803			0	%
Total earning assets			1,846,225				1,971,558				(125,333	)		-6	%				1,839,437				6,788			0	%
Gross loans			1,371,187				1,330,044				41,143			3	%				1,415,506				(44,319	)		-3	%
Deposits			1,652,013				1,759,592				(107,579	)		-6	%				1,569,170				82,843			5	%
Tangible equity			146,032				142,118				3,914			3	%				129,865				16,167			12	%
Tangible equity / total assets			7.57	%			6.92	%		+65 Basis Points									6.75	%		+82 Basis Points
Gross loans / total deposits			83.00	%			75.59	%		+741 Basis Points									90.21	%		-721 Basis Points
Noninterest-bearing deposits / total deposits			44.88	%			45.24	%		-36 Basis Points									43.97	%		+91 Basis Points

CALIFORNIA BANCORP AND SUBSIDIARY
SELECTED INTERIM FINANCIAL INFORMATION (UNAUDITED) - ASSET QUALITY
(Dollars in Thousands)
ALLOWANCE FOR LOAN LOSSES:		03/31/22				12/31/21				09/30/21				06/30/21				03/31/21
Balance, beginning of period		$	14,081			$	13,571			$	13,240			$	14,577			$	14,111
Provision for loan losses, quarterly			950				504				300				(1,100	)			300
Charge-offs, quarterly			-				-				-				(278	)			-
Recoveries, quarterly			1				6				31				41				166
Balance, end of period		$	15,032			$	14,081			$	13,571			$	13,240			$	14,577
NONPERFORMING ASSETS:		03/31/22				12/31/21				09/30/21				06/30/21				03/31/21
Loans accounted for on a non-accrual basis		$	549			$	232			$	1,233			$	1,234			$	234
Loans with principal or interest contractually past due 90 days or more and still accruing interest			-				-				-				-				-
Nonperforming loans		$	549			$	232			$	1,233			$	1,234			$	234
Other real estate owned			-				-				-				-				-
Nonperforming assets		$	549			$	232			$	1,233			$	1,234			$	234
Loans restructured and in compliance with modified terms			-				-				-				-				-
Nonperforming assets and restructured loans		$	549			$	232			$	1,233			$	1,234			$	234
Nonperforming loans by asset type:
Commercial		$	-			$	-			$	-			$	-			$	-
Real estate other			-				-				1,000				1,000				-
Real estate construction and land			-				-				-				-				-
SBA			549				232				233				234				234
Other			-				-				-				-				-
Nonperforming loans		$	549			$	232			$	1,233			$	1,234			$	234
ASSET QUALITY:		03/31/22				12/31/21				09/30/21				06/30/21				03/31/21
Allowance for loan losses / gross loans			1.07	%			1.02	%			1.04	%			0.98	%			0.99	%
Allowance for loan losses / nonperforming loans			2738.07	%			6069.40	%			1100.65	%			1072.93	%			6229.49	%
Nonperforming assets / total assets			0.03	%			0.01	%			0.06	%			0.07	%			0.01	%
Nonperforming loans / gross loans			0.04	%			0.02	%			0.09	%			0.09	%			0.02	%
Net quarterly charge-offs / gross loans			-0.00	%			-0.00	%			-0.00	%			0.02	%			-0.01	%

CALIFORNIA BANCORP AND SUBSIDIARY
INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in Thousands, Except Per Share Data)
	Three months ended
	03/31/22				12/31/21				03/31/21
INTEREST INCOME
Loans	$	14,886			$	14,520			$	14,584
Federal funds sold		136				216				88
Investment securities		902				807				360
Total interest income		15,924				15,543				15,032
INTEREST EXPENSE
Deposits		806				937				1,191
Other		592				639				505
Total interest expense		1,398				1,576				1,696
Net interest income		14,526				13,967				13,336
Provision for loan losses		950				504				300
Net interest income after provision for loan losses		13,576				13,463				13,036
NON-INTEREST INCOME
Service charges and other fees		889				1,038				641
Gain on sale of loans		1,393				-				-
Other non-interest income		252				(44	)			280
Total non-interest income		2,534				994				921
NON-INTEREST EXPENSE
Salaries and benefits		7,093				6,370				6,367
Premises and equipment		1,302				1,320				1,197
Other		2,521				2,319				2,516
Total non-interest expense		10,916				10,009				10,080
Income before income taxes		5,194				4,448				3,877
Income taxes		1,521				1,267				1,068
NET INCOME	$	3,673			$	3,181			$	2,809
EARNINGS PER SHARE
Basic earnings per share	$	0.44			$	0.39			$	0.34
Diluted earnings per share	$	0.44			$	0.38			$	0.34
Average common shares outstanding		8,276,761				8,255,340				8,179,667
Average common and equivalent shares outstanding		8,392,802				8,342,032				8,242,467
PERFORMANCE MEASURES
Return on average assets		0.77	%			0.61	%			0.59	%
Return on average equity		9.70	%			8.43	%			8.29	%
Return on average tangible equity		10.20	%			8.88	%			8.77	%
Efficiency ratio		63.99	%			66.90	%			70.70	%

CALIFORNIA BANCORP AND SUBSIDIARY
INTERIM CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in Thousands)
		03/31/22				12/31/21				09/30/21				06/30/21				03/31/21
ASSETS
Cash and due from banks		$	18,228			$	4,539			$	22,424			$	26,159			$	18,475
Federal funds sold			206,305				465,917				578,626				366,347				342,305
Investment securities			171,764				103,278				82,108				61,142				58,105
Loans:
Commercial			522,808				474,281				428,169				425,643				439,044
Real estate other			741,651				697,212				664,202				616,451				573,520
Real estate construction and land			51,204				43,194				41,312				41,558				45,550
SBA			44,040				81,403				107,096				204,734				364,273
Other			40,771				80,559				61,193				64,253				47,926
Loans, gross			1,400,474				1,376,649				1,301,972				1,352,639				1,470,313
Unamortized net deferred loan costs (fees)			2,434				1,688				760				(629	)			(1,569	)
Allowance for loan losses			(15,032	)			(14,081	)			(13,571	)			(13,240	)			(14,577	)
Loans, net			1,387,876				1,364,256				1,289,161				1,338,770				1,454,167
Premises and equipment, net			4,047				4,405				4,227				5,089				5,452
Bank owned life insurance			24,614				24,412				24,247				24,085				23,920
Goodwill and core deposit intangible			7,503				7,513				7,524				7,534				7,544
Accrued interest receivable and other assets			39,258				40,676				40,762				39,937				37,620
Total assets		$	1,859,595			$	2,014,996			$	2,049,079			$	1,869,063			$	1,947,588
LIABILITIES
Deposits:
Demand noninterest-bearing		$	746,673			$	771,205			$	790,646			$	791,580			$	742,574
Demand interest-bearing			36,419				37,250				39,679				36,268				33,022
Money market and savings			686,781				717,480				750,112				674,390				670,517
Time			130,649				154,203				161,617				177,534				183,602
Total deposits			1,600,522				1,680,138				1,742,054				1,679,772				1,629,715
Junior subordinated debt securities			54,063				54,028				59,009				24,745				24,729
Other borrowings			32,166				106,387				79,536				-				134,819
Accrued interest payable and other liabilities			18,273				23,689				21,241				20,805				19,147
Total liabilities			1,705,024				1,864,242				1,901,840				1,725,322				1,808,410
SHAREHOLDERS' EQUITY
Common stock			109,815				109,473				109,009				108,417				108,430
Retained earnings			44,862				41,189				38,008				34,792				30,630
Accumulated other comprehensive (loss)			(106	)			92				222				532				118
Total shareholders' equity			154,571				150,754				147,239				143,741				139,178
Total liabilities and shareholders' equity		$	1,859,595			$	2,014,996			$	2,049,079			$	1,869,063			$	1,947,588
CAPITAL ADEQUACY
Tier I leverage ratio			7.84	%			7.23	%			7.29	%			7.53	%			7.46	%
Tier I risk-based capital ratio			8.49	%			8.62	%			9.17	%			9.35	%			9.47	%
Total risk-based capital ratio			12.49	%			12.75	%			13.92	%			11.93	%			12.34	%
Total equity/ total assets			8.31	%			7.48	%			7.19	%			7.69	%			7.15	%
Book value per share		$	18.69			$	18.24			$	17.85			$	17.47			$	16.99
Common shares outstanding			8,270,901				8,264,300				8,250,109				8,229,116				8,189,598

CALIFORNIA BANCORP AND SUBSIDIARY
INTERIM CONSOLIDATED AVERAGE BALANCE SHEET AND YIELD DATA (UNAUDITED)
(Dollars in Thousands)
	Three months ended March 31,											Three months ended December 31,
	2022											2021
					Yields			Interest								Yields			Interest
	Average				or			Income/				Average				or			Income/
	Balance				Rates			Expense				Balance				Rates			Expense
ASSETS
Interest earning assets:
Loans (1)	$	1,371,187			4.40	%		$	14,886			$	1,330,044			4.33	%		$	14,520
Federal funds sold		345,394			0.16	%			136				536,503			0.16	%			216
Investment securities		129,644			2.82	%			902				105,011			3.05	%			807
Total interest earning assets		1,846,225			3.50	%			15,924				1,971,558			3.13	%			15,543
Noninterest-earning assets:
Cash and due from banks		18,748											18,886
All other assets (2)		63,569											64,046
TOTAL	$	1,928,542										$	2,054,490
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
Deposits:
Demand	$	38,197			0.10	%		$	9			$	37,379			0.10	%		$	9
Money market and savings		723,109			0.37	%			665				766,826			0.40	%			769
Time		149,293			0.36	%			132				159,420			0.40	%			159
Other		100,664			2.39	%			592				122,722			2.07	%			639
Total interest-bearing liabilities		1,011,263			0.56	%			1,398				1,086,347			0.58	%			1,576
Noninterest-bearing liabilities:
Demand deposits		741,414											795,967
Accrued expenses and other liabilities		22,325											22,539
Shareholders' equity		153,540											149,637
TOTAL	$	1,928,542										$	2,054,490
Net interest income and margin (3)					3.19	%		$	14,526							2.81	%		$	13,967
(1) Nonperforming loans are included in average loan balances. No adjustment has been made for these loans in the calculation of yields. Interest income on loans includes amortization of net deferred loan fees of $318,000 and $125,000, respectively.
(2) Other noninterest-earning assets includes the allowance for loan losses of $14.1 million and $13.6 million, respectively.
(3) Net interest margin is net interest income divided by total interest-earning assets.

CALIFORNIA BANCORP AND SUBSIDIARY
INTERIM CONSOLIDATED AVERAGE BALANCE SHEET AND YIELD DATA (UNAUDITED)
(Dollars in Thousands)
	Three months ended March 31,
	2022											2021
					Yields			Interest								Yields			Interest
	Average				or			Income/				Average				or			Income/
	Balance				Rates			Expense				Balance				Rates			Expense
ASSETS
Interest earning assets:
Loans (1)	$	1,371,187			4.40	%		$	14,886			$	1,415,506			4.18	%		$	14,584
Federal funds sold		345,394			0.16	%			136				369,223			0.10	%			88
Investment securities		129,644			2.82	%			902				54,708			2.67	%			360
Total interest earning assets		1,846,225			3.50	%			15,924				1,839,437			3.31	%			15,032
Noninterest-earning assets:
Cash and due from banks		18,748											23,033
All other assets (2)		63,569											60,269
TOTAL	$	1,928,542										$	1,922,739
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
Deposits:
Demand	$	38,197			0.10	%		$	9			$	34,512			0.13	%		$	11
Money market and savings		723,109			0.37	%			665				644,740			0.61	%			972
Time		149,293			0.36	%			132				199,953			0.42	%			208
Other		100,664			2.39	%			592				192,803			1.06	%			505
Total interest-bearing liabilities		1,011,263			0.56	%			1,398				1,072,008			0.64	%			1,696
Noninterest-bearing liabilities:
Demand deposits		741,414											689,965
Accrued expenses and other liabilities		22,325											23,351
Shareholders' equity		153,540											137,415
TOTAL	$	1,928,542										$	1,922,739
Net interest income and margin (3)					3.19	%		$	14,526							2.94	%		$	13,336
(1) Nonperforming loans are included in average loan balances. No adjustment has been made for these loans in the calculation of yields. Interest income on loans includes amortization of net deferred loan fees of $318,000 and $1.2 million, respectively.
(2) Other noninterest-earning assets includes the allowance for loan losses of $14.1 million and $14.2 million, respectively.
(3) Net interest margin is net interest income divided by total interest-earning assets.

CALIFORNIA BANCORP AND SUBSIDIARY
INTERIM CONSOLIDATED NON GAAP DATA (UNAUDITED)
(Dollars in Thousands)
REVENUE:		Q1 2022				Q4 2021				Q3 2021				Q2 2021				Q1 2021
Net interest income		$	14,526			$	13,967			$	13,841			$	13,586			$	13,336
Non-interest income			2,534				994				1,302				956				921
Total revenue		$	17,060			$	14,961			$	15,143			$	14,542			$	14,257
														Amortization				Deferred
PPP RELATED DEFERRED FEES AND COSTS:		Deferred Balance at Origination												of Deferred				Balance
		2021 Program				2020 Program				Total				Balance				Remaining
PPP fees		$	4,479			$	9,086			$	13,565			$	12,443			$	1,122
PPP capitalized loan origination costs			540				2,451				2,991				2,868			$	123
Net PPP fees		$	3,939			$	6,635			$	10,574			$	9,575			$	999
		Amortization of Deferred Balance
IMPACT OF PPP ACTIVITY REFLECTED IN NET INTEREST INCOME:		Q1 2022				Q4 2021				Q3 2021				Q2 2021				Q1 2021
PPP fees		$	1,014			$	817			$	1,909			$	2,185			$	2,222
PPP capitalized loan origination costs			223				109				348				514				633
Net PPP fees		$	791			$	708			$	1,561			$	1,671			$	1,589
NON-INTEREST EXPENSE:		Q1 2022				Q4 2021				Q3 2021				Q2 2021				Q1 2021
Total non-interest expense		$	10,916			$	10,009			$	10,513			$	9,835			$	10,080
Total capitalized loan origination costs			984				1,601				1,197				1,217				1,513
Total operating expenses, before capitalization of loan origination costs		$	11,900			$	11,610			$	11,710			$	11,052			$	11,593
GROSS LOANS:		Q1 2022				12/31/21				09/30/21				06/30/21				03/31/21
Gross loans		$	1,400,474			$	1,376,649			$	1,301,972			$	1,352,639			$	1,470,313
PPP loans			36,905				72,527				97,451				194,472				353,426
Gross loans, excluding PPP loans		$	1,363,569			$	1,304,122			$	1,204,521			$	1,158,167			$	1,116,887