Cashmere Valley Bank Reports Quarterly Earnings of $7.3 Million

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CASHMERE, WA / ACCESSWIRE / April 16, 2024 / Cashmere Valley Bank (OTCQX:CSHX) ("Bank"), announced quarterly earnings of $7.3 million for the quarter ended March 31, 2024. Diluted earnings per share was $1.87, representing a decrease of $0.12 per share, or 6.0%.

"In spite of a challenging environment our core earnings remain strong," said Greg Oakes, President and CEO. "One year ago, our net interest margin was expanding nicely, however, deposit costs have been rapidly increasing and adversely affecting our margin. We are relieved to show slight deposit growth in the quarter; however, the cost of the deposit growth is significant. The inversion in the yield curve creates a tough environment for all financial institutions. We were pleased to navigate through the environment with another quarter of strong earnings."

Q1 Highlights

The Bank reported the following statement of condition highlights as of March 31, 2024:

  • As of March 31, 2024, gross loans totaled $1.041 billion, representing an increase from March 31, 2023 of $25.2 million.

  • Deposit balances totaled $1.785 billion as of March 31, 2024. Deposit balances decreased $56.3 million, or 3.1%, from March 31, 2023. Deposit balances increased from December 31, 2023 by $11.1 million, or 0.6%. Non-interest deposits totaled $399.0 million as of March 31, 2024, which represents 22.4% of total deposits.

  • Return on assets decreased from 1.51% to 1.44%, due to an increase in assets and the reduction in earnings.

  • Return on equity decreased from 18.7% to 14.4%, due to equity growth and the reduction in earnings.

Cash, Cash Equivalents and Restricted Cash

Total cash, cash equivalents and restricted cash totaled $138.2 million at March 31, 2024, compared to $110.5 million at March 31, 2023. The $27.7 million increase was primarily due to efforts to retain higher cash balances on overnight funds that are paying approximately 5.40%, and to help insure against further deposit losses. Available borrowing lines from the Federal Home Loan Bank and the Federal Reserve totaled approximately $416.6 million.

Investments

The investment portfolio totaled $793.6 million at March 31, 2024, an increase of $2.9 million from March 31, 2023. As of March 31, 2024, available for sale securities totaled $655.7 million and held to maturity securities totaled $137.9 million. For the quarter ended March 31, 2024, securities earned 3.94% as compared to 3.17% one year ago. The increase in the earnings rate is attributable to increasing yields on floating rate securities in combination with higher rates on new securities purchases.