 OAKLAND, Calif., July 28, 2020 GLOBE NEWSWIRE -- California BanCorp the Company Nasdaq: CALB, the parent company of California Bank of Commerce the Bank, today announced its financial results for the second quarter and six months ended June 30, 2020. Net income was 1.55 million for the second quarter of 2020, representing an increase of 1.1 million or 228 compared to 473 thousand for the first quarter of 2020 and a decrease of 1.0 million or 39 compared to 2.55 million in the second quarter of 2019. For the six months ended June 30, 2020, net income was 2.02 million representing a decrease of 2.4 million or 54 compared to 4.42 million for the same period in 2019.Per share earnings of 0.19 for the second quarter of 2020 compared to 0.06 for the first quarter of 2020 and 0.31 in the second quarter of 2019. For the six months ended June 30, 2020, per share earnings of 0.25 compared to 0.54 for the same period in 2019. Despite the challenges presented by the COVID-19 pandemic, we had an extraordinarily productive quarter and were able to support our clients by providing access to the Paycheck Protection Program PPP and offering temporary loan payment relief, said Steven Shelton, President and CEO of California BanCorp. Through our efforts in the PPP program, we significantly expanded our client base and have already seen a positive impact on loan production and deposit flows from these new clients outside of the balances related to their PPP funding. To date, we have not seen the crisis have a significant impact on our client base, as our non-performing assets declined from the prior quarter and only a small percentage of borrowers indicate they will require an extension of their loan deferral. We are seeing positive trends in our loan pipeline and we believe that we are well positioned to realize more operating leverage going forward as we continue to grow our balance sheet, excluding the impact of PPP loans.While our asset quality remains strong, we continue to build our level of reserves given the uncertainty about the duration of the crisis, said Thomas A. Sa, Senior Executive Vice President, Chief Financial Officer and Chief Operating Officer of California BanCorp. Excluding PPP loans, our allowance for loan losses increased to 1.35 of total loans from 1.19 at the end of the prior quarter. Given our high level of reserves and strong capital and liquidity positions, we believe we are well prepared to continue supporting our clients during this period of economic weakness.Highlights: Funded 361.6 million of loans under the Paycheck Protection Program PPP to support clients. CALB common stock added to the Russell 2000 index. Three months ended June 30, 2020 compared to March 31, 2020 Net income of 1.55 million and 0.19 per share, compared to 473 thousand and 0.06 per share, respectively. Revenue increased 90 thousand, or 1 to 11.6 million. Provision for loan losses increased 2.5 million to cover a charge-off of a legacy problem loan and fund a qualitative reserve build in response to general macroeconomic changes related to COVID-19. Non-interest expense decreased by 4.0 million including 4.2 million of deferred loan origination costs related to PPP loans and other loan programs in support of clients. Six months ended June 30, 2020 compared to June 30, 2019 Net income of 2.0 million and 0.25 per share, compared to 4.4 million and 0.54 per share, respectively. Revenue increased 1.3 million, or 5 to 23.0 million. Non-interest expense decreased by 943 thousand including 4.1 million of deferred loan origination costs related to PPP loans and other loan programs in support of clients.Financial Position June 30, 2020 compared to March 31, 2020 Total assets increased by 702.9 million, or 58 to 1.91 billion. Total loans increased by 330.5 million, or 34 to 1.30 billion. Total deposits increased by 356.8 million, or 35 to 1.39 billion. Capital ratios including the impact of PPP loan activity remain healthy with a tier-one leverage ratio of 8.13, tangible common equity ratio of 11.27 and total risk-based capital ratio of 12.87.Impact of and Response to the COVID-19 PandemicIn response to the rapidly evolving COVID-19 pandemic, the Company focused first on the well-being of its people, customers and communities. Preventative health measures were put in place including elimination of business related travel requirements, mandatory work from home for all employees able to do so, social distancing precautions for all employees in the office and customers visiting branches, and preventative cleaning at offices and branches.The Company also focused on business continuity measures including monitoring potential business interruptions, making improvements to our remote working technology, and conducting regular discussions with our technology vendors to ensure full functionality throughout this event.The Company has also taken measures to both support customers affected by the pandemic and to maintain strong asset quality, including: Helping business clients through the PPP and other loan products; following the launch of the PPP in early April, we processed 100 of the approximately 720 applications received and all of the applications we submitted to the SBA received approval. At June 30, 2020, the balance of loans funded under the PPP was 361.6 million. Offering flexible repayment options to current clients and a streamlined loan modification process, when appropriate. Beginning in March, we launched a proactive deferral program that resulted in modification of 383 loans, 302 of which were processed by the end of April, 70 in May and 11 in June. At June 30, 2020, the aggregate balance of loans under deferral was approximately 323.9 million. As of July 20, 2020, we have received payments on 257 loans representing 216.6 million as they have come off deferral. Implementing a broad-based risk management strategy to manage credit segments on a real-time basis; Monitoring portfolio risk and related mitigation strategies by segments;Specific impacts of the Covid-19 macroeconomic environment on our operating results for the second quarter of 2020 include the following: Funding of loans under the PPP and related borrowing under the Paycheck Protection Program Liquidity Facility PPPLF provided net benefit to net interest income of 1.3 million during the second quarter, including the impact of amortization of deferred fees and origination costs. The Company received 9.1 million in fees related to the origination of PPP loans. Recognition of the fees was deferred at origination and will be recognized over the 24 month term of the loans. In the second half of the year, we expect the majority of clients to apply for forgiveness of debt under the PPP and, if granted, the remaining fees would be recognized at the payoff of the loan. Operating expenses were reduced by approximately 4.2 million of deferred loan origination costs. Of this amount, 2.5 million related to PPP loans and is being amortized over the remaining term of the PPP loans and 1.7 million related to loan modifications and is being amortized over the remaining term of the modified loans. The continued uncertainty regarding the severity and duration of the pandemic and related economic effects considered in our qualitative assessment of the allowance for loan losses resulted in an increase in provision of approximately 1.9 million.Balance SheetTotal assets reached a record 1.91 billion as of June 30, 2020, an increase of 702.9 million, or 58, compared to 1.21 billion at March 31, 2020 and 851.0 million, or 80 compared to 1.06 billion at June 30, 2019. Growth in total assets was the result of originating 361.6 million of loans for clients under the PPP and using 332.7 million of borrowing under the PPPLF to largely match fund PPP loans. Total loans increased by 330.5 million, or 34 to 1.30 billion at June 30, 2020, from 968.9 million at March 31, 2020 and 390.1 million, or 43 compared to 909.4 million at June 30, 2019. Loan growth in the second quarter of 2020 compared to the first quarter of 2020 and the same period last year was primarily due to the loans funded under the PPP. During the quarter, growth in commercial real estate loans and construction loans of 12.2 million and 7.8 million, respectively, was offset by a decrease in commercial loans of 50.4 million. The decrease in commercial loans was primarily due to reduced line utilization. Utilization rates on lines of credit declined to 24 at June 30, 2020 from 38 at March 31, 2020 and 34 at June 30, 2019, representing decreases of 59.7 million and 41.1 million, respectively. Year-over-year loan growth included increases in commercial real estate loans and construction loans of 31.8 million and 18.9 million, respectively, offset by a decrease in commercial loans of 22.3 million. Total deposits increased by 356.8 million, or 35 to 1.39 billion at June 30, 2020, from 1.03 billion at March 31, 2020 and 503.5 million, or 57 over 882.2 million at June 30, 2019. Deposit growth in the second quarter of 2020 compared to the first quarter of 2020 and the same period last year was primarily concentrated in noninterest-bearing demand deposits as the result of funding PPP loans. Deposits generated from loans originated under the PPP were approximately 299.3 million at June 30, 2020. Non-interest bearing deposits, primarily commercial business operating accounts, represented 46.4 of total deposits at June 30, 2020, compared to 39.2 at March 31, 2020 and 37.3 at June 30, 2019.Borrowings of 364.7 million at June 30, 2020 compared to 22.0 million at March 31, 2020 and 30.0 million at June 30, 2019. 