Company Quick10K Filing
⚲
Luther Burbank
Financials
Price11.49 EPS1
Shares56 P/E14
MCap647 P/FCF12
Net Debt-168 EBIT171
TEV479 TEV/EBIT3
TTM 2019-09-30, in MM, except price, ratios
Filings
10-Q 2020-06-30 Filed 2020-08-07
10-Q 2020-03-31 Filed 2020-05-08
10-K 2019-12-31 Filed 2020-03-11
10-Q 2019-09-30 Filed 2019-11-12
10-Q 2019-06-30 Filed 2019-08-09
10-Q 2019-03-31 Filed 2019-05-10
10-K 2018-12-31 Filed 2019-03-04
10-Q 2018-09-30 Filed 2018-11-09
10-Q 2018-06-30 Filed 2018-08-09
10-Q 2018-03-31 Filed 2018-05-10
10-K 2017-12-31 Filed 2018-03-16
Reports
8-K 2020-07-28 Earnings, Regulation FD, Other Events, Exhibits
8-K 2020-07-10 Regulation FD, Exhibits
8-K 2020-05-04
8-K 2020-04-28
8-K 2020-04-10
8-K 2020-03-11
8-K 2020-02-26
8-K 2020-01-28
8-K 2020-01-10
8-K 2019-10-23
8-K 2019-10-03
8-K 2019-07-29
8-K 2019-07-10
8-K 2019-04-29
8-K 2019-04-26
8-K 2019-04-24
8-K 2019-04-10
8-K 2019-01-31
8-K 2019-01-28
8-K 2019-01-10
8-K 2018-12-14
8-K 2018-11-30
8-K 2018-10-25
8-K 2018-10-10
8-K 2018-08-16
8-K 2018-07-26
8-K 2018-07-10
8-K 2018-06-07
8-K 2018-05-24
8-K 2018-04-27
8-K 2018-04-26
8-K 2018-04-05
8-K 2018-03-05
8-K 2018-01-25

LBC 10Q Quarterly Report

Content
Part I.
Item 1. Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II.
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
Exhibits
EX-31.1 lbc10qex3112020q2.htm
EX-31.2 lbc10qex3122020q2.htm
EX-32.1 lbc10qex3212020q2.htm
EX-32.2 lbc10qex3222020q2.htm

Luther Burbank Earnings 2020-06-30

Balance SheetIncome StatementCash Flow
lbc-20200630
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
 
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2020
OR
☐  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 001-38317
Luther Burbank Corporation
(Exact name of registrant as specified in its charter)
California
(State or other jurisdiction of incorporation or organization)
68-0270948
(I.R.S. employer identification number)
   
520 Third St, Fourth Floor, Santa Rosa, California
 (Address of principal executive offices)
 
95401
(Zip Code)
 

Registrant's telephone number, including area code: (844) 446-8201
Securities Registered Pursuant to Section 12(b) of the Act
Title of Each ClassTrading SymbolName of Each Exchange on Which Registered
Common stock, no par valueLBCThe Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by checkmark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of "large accelerated filer", "accelerated filer", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer
o
Accelerated filer☒
Non-accelerated filer
o
Smaller Reporting Company☒
Emerging Growth Company☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act): Yes ☐ No x

As of July 31, 2020, there were 52,394,127 shares of the registrant’s common stock, no par value, outstanding.


Table of Contents
Table of Contents
Page
PART I - FINANCIAL INFORMATION
Item 1.
Item 2.
Item 3.
Item 4.
PART II - OTHER INFORMATION
Item 1.
Item 1A.
Item 2.
Item 5.
Item 6.
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Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
 
This Quarterly Report on Form 10-Q may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You can find many (but not all) of these statements by looking for words such as “approximates,” “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “would,” “may” and other similar expressions in this Quarterly Report on Form 10-Q. With respect to any such forward-looking statements, the Company claims the protection of the safe harbor provided for in the Private Securities Litigation Reform Act of 1995, as amended. The Company cautions investors that any forward-looking statements presented in this Quarterly Report on Form 10-Q, or those that the Company may make orally or in writing from time to time, are based on the beliefs of, assumptions made by, and information available to, management at the time such statements are first made. Actual outcomes will be affected by known and unknown risks, trends, uncertainties and factors that are beyond the Company’s control or ability to predict.  Although the Company believes that management’s beliefs and assumptions are reasonable, they are not guarantees of future performance and some will inevitably prove to be incorrect. As a result, the Company’s actual future results can be expected to differ from management’s expectations, and those differences may be material and adverse to the Company’s business, results of operations and financial condition. Accordingly, investors should use caution in placing any reliance on forward-looking statements to anticipate future results or trends.

The coronavirus disease 2019 ("COVID-19") pandemic is adversely affecting us, our customers, counterparties, employees, and third-party service providers, and the ultimate extent of the impacts on our business, financial position, results of operations, liquidity, and prospects is uncertain. Continued deterioration in general business and economic conditions, including further increases in unemployment rates, or turbulence in domestic or global financial markets could adversely affect our revenues and the values of our assets and liabilities, reduce the availability of funding, lead to a tightening of credit, and further increase stock price volatility. In addition, changes to statutes, regulations, or regulatory policies or practices as a result of, or in response to COVID-19, could affect us in substantial and unpredictable ways. Some of the other risks and uncertainties that may cause the Company’s actual results, performance or achievements to differ materially from those expressed include, but are not limited to, the following: the impact of changes in interest rates; political instability; changes in the monetary policies of the U.S. Government; a decline in economic conditions; deterioration in the value of West Coast real estate, both residential and commercial; an increase in the level of non-performing assets and charge-offs; further increased competition among financial institutions; the Company’s ability to continue to attract deposits and quality loan customers; further government regulation, including regulations regarding capital requirements, and the implementation and costs associated with the same; internal and external fraud and cyber-security threats including the loss of bank or customer funds, loss of system functionality or the theft or loss of data; management’s ability to successfully manage the Company’s operations; and the other risks set forth in the Company’s reports filed with the U.S. Securities and Exchange Commission. For further discussion of these and other factors, see “Item 1A. Risk Factors” in Part II of this Quarterly Report on Form 10-Q and the Company’s 2019 Annual Report on Form 10-K.

Any forward-looking statements in this Quarterly Report on Form 10-Q and all subsequent written and oral forward-looking statements attributable to the Company or any person acting on behalf of the Company are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. The Company does not undertake any obligation to release publicly any revisions to forward-looking statements to reflect events or circumstances after the date such forward-looking statements are made, and hereby specifically disclaims any intention to do so, unless required by law.


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PART I.

Item 1. Financial Statements
LUTHER BURBANK CORPORATION
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollar amounts in thousands)
June 30,
2020 (unaudited)		December 31,
2019
ASSETS
Cash, cash equivalents and restricted cash$170,197  $91,325  
Available for sale debt securities, at fair value635,324  625,074  
Held to maturity debt securities, at amortized cost (fair value of $9,839 and $10,349 at June 30, 2020 and December 31, 2019, respectively)
9,400  10,170  
Equity securities, at fair value12,070  11,782  
Loans receivable, net of allowance for loan losses of $45,985 and $36,001 at June 30, 2020 and December 31, 2019, respectively
6,235,054  6,194,976  
Accrued interest receivable20,388  20,814  
Federal Home Loan Bank ("FHLB") stock, at cost29,612  30,342  
Premises and equipment, net19,262  19,504  
Goodwill3,297  3,297  
Prepaid expenses and other assets33,742  38,544  
Total assets$7,168,346  $7,045,828  
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits $5,383,519  $5,234,717  
FHLB advances961,747  978,702  
Junior subordinated deferrable interest debentures61,857  61,857  
Senior debt
$95,000 face amount, 6.5% interest rate, due September 30, 2024 (less debt issuance costs of $522 and $584 at June 30, 2020 and December 31, 2019, respectively)
94,478  94,416  
Accrued interest payable1,253  2,901  
Other liabilities and accrued expenses68,810  58,771  
Total liabilities6,571,664  6,431,364  
Commitments and contingencies (Note 16)
Stockholders' equity:
Preferred stock, no par value; 5,000,000 shares authorized; none issued and outstanding at June 30, 2020 and December 31, 2019, respectively
—  —  
Common stock, no par value; 100,000,000 shares authorized; 52,382,895 and 55,999,754 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively
414,264  447,784  
Retained earnings175,852  165,236  
Accumulated other comprehensive income, net of taxes6,566  1,444  
Total stockholders' equity596,682  614,464  
Total liabilities and stockholders' equity$7,168,346  $7,045,828  
See accompanying notes to unaudited consolidated financial statements
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LUTHER BURBANK CORPORATION
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Dollar amounts in thousands, except per share data)
Three Months Ended June 30,Six Months Ended June 30,
2020201920202019
Interest and fee income:
Loans$58,190  $61,015  $118,895  $122,068  
Investment securities2,316  4,118  5,619  8,043  
Cash, cash equivalents and restricted cash55  522  372  922  
Total interest and fee income60,561  65,655  124,886  131,033  
Interest expense:
Deposits19,821  26,471  44,402  50,759  
FHLB advances5,685  6,410  11,243  13,182  
Junior subordinated deferrable interest debentures332  632  825  1,283  
Senior debt1,575  1,574  3,153  3,149  
Total interest expense27,413  35,087  59,623  68,373  
Net interest income before provision for loan losses33,148  30,568  65,263  62,660  
Provision for loan losses5,250  450  10,550  750  
Net interest income after provision for loan losses27,898  30,118  54,713  61,910  
Noninterest income:
Gain on sale of loans—  197  —  530  
FHLB dividends374  552  909  1,047  
Other income297  739  560  1,291  
Total noninterest income671  1,488  1,469  2,868  
Noninterest expense:
Compensation and related benefits10,300  8,614  21,505  18,666  
Deposit insurance premium471  487  947  985  
Professional and regulatory fees454  457  885  898  
Occupancy1,101  1,399  2,241  2,789  
Depreciation and amortization687  664  1,356  1,329  
Data processing1,038  945  2,005  1,864  
Marketing330  1,071  1,205  2,225  
Other expenses967  1,072  2,063  2,202  
Total noninterest expense15,348  14,709  32,207  30,958  
Income before provision for income taxes13,221  16,897  23,975  33,820  
Provision for income taxes3,903  5,239  7,081  10,152  
Net income$9,318  $11,658  $16,894  $23,668  
Basic earnings per common share$0.18  $0.21  $0.31  $0.42  
Diluted earnings per common share$0.18  $0.21  $0.31  $0.42  
Dividends per common share$0.06  $0.06  $0.12  $0.12  

See accompanying notes to unaudited consolidated financial statements
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LUTHER BURBANK CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)
(Dollar amounts in thousands)
Three Months Ended June 30,Six Months Ended June 30,
2020201920202019
Net income$9,318  $11,658  $16,894  $23,668  
Other comprehensive income:
Unrealized gain on available for sale debt securities:
Unrealized holding gain arising during the period6,172  5,469  7,223  7,973  
Tax effect(1,796) (1,585) (2,101) (2,309) 
Net of tax4,376  3,884  5,122  5,664  
Unrealized gain on cash flow hedge:
Unrealized holding gain arising during the period—  —  —  147  
Tax effect—  —  —  (43) 
Net of tax—  —  —  104  
Total other comprehensive income4,376  3,884  5,122  5,768  
Comprehensive income$13,694  $15,542  $22,016  $29,436  

See accompanying notes to unaudited consolidated financial statements
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LUTHER BURBANK CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED)
(Dollar amounts in thousands, except per share data)
Accumulated Other Comprehensive (Loss) Income (Net of Taxes)Total Stockholders' Equity
Common StockRetained EarningsAvailable for Sale Securities
SharesAmount
Balance, March 31, 201956,351,781  $452,931  $138,123  $(2,756) $588,298  
Comprehensive income:
Net income—  —  11,658  —  11,658  
Other comprehensive income—  —  —  3,884  3,884  
Issuance of restricted stock awards24,121  —  —  —  —  
Settled restricted stock units9,677  —  —  —  —  
Shares withheld to pay taxes on stock based compensation(3,119) (33) —  —  (33) 
Restricted stock forfeitures(33,268) (129) 9  —  (120) 
Stock based compensation expense—  805  —  —  805  
Shares repurchased(366,701) (3,749) —  —  (3,749) 
Cash dividends ($0.06 per share)
—  —  (3,276) —  (3,276) 
Balance, June 30, 201955,982,491  $449,825  $146,514  $1,128  $597,467  
Balance, March 31, 202054,286,465  $431,578  $169,572  $2,190  $603,340  
Comprehensive income:
Net income—  —  9,318  —  9,318  
Other comprehensive income—  —  —  4,376  4,376  
Shares withheld to pay taxes on stock based compensation(2,740) (28) —  —  (28) 
Restricted stock forfeitures(11,416) (17) 2—  (15) 
Stock based compensation expense—  899  —  —  899  
Shares repurchased(1,889,414) (18,168) —  —  (18,168) 
Cash dividends ($0.06 per share)
—  —  (3,040) —  (3,040) 
Balance, June 30, 202052,382,895  $414,264  $175,852  $6,566  $596,682  
See accompanying notes to unaudited consolidated financial statements
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Accumulated Other Comprehensive (Loss) Income (Net of Taxes)Total Stockholders' Equity
Common StockRetained EarningsAvailable for Sale SecuritiesCash Flow Hedge
SharesAmount
Balance, December 31, 201856,379,066  $456,378  $129,806  $(4,935) $(104) $581,145  
Cumulative effect of change in accounting principal (1)—  —  (399) 399  —  —  
Comprehensive income:
Net income—  —  23,668  —  —  23,668  
Other comprehensive income—  —  —  5,664  104  5,768  
Issuance of restricted stock awards321,784  —  —  —  —  —  
Settled restricted stock units121,979  —  —  —  —  —  
Shares withheld to pay taxes on stock based compensation(44,641) (437) —  —  —  (437) 
Restricted stock forfeitures(35,996) (131) 10  —  —  (121) 
Stock based compensation expense—  1,645  —  —  —  1,645  
Shares repurchased(759,701) (7,630) —  —  —  (7,630) 
Cash dividends ($0.12 per share)
—  —  (6,571) —  —  (6,571) 
Balance, June 30, 201955,982,491  $449,825  $146,514  $1,128  $—  $597,467  
Balance, December 31, 201955,999,754  $447,784  $165,236  $1,444  $—  $614,464  
Comprehensive income:
Net income—  —  16,894  —  —  16,894  
Other comprehensive income—  —  —  5,122  —  5,122  
Issuance of restricted stock awards250,118  —  —  —  —  —  
Settled restricted stock units70,220  —  —  —  —  —  
Shares withheld to pay taxes on stock based compensation(56,564) (591) —  —  —  (591) 
Restricted stock forfeitures(28,824) (25) 8—  —  (17) 
Stock based compensation expense—  1,810