Central Valley Community Bancorp has a market cap of $54.2 million; its shares were traded at around $5.95 with a P/E ratio of 19.2 and P/S ratio of 1.4.
Highlight of Business Operations:On January 30, 2009, the Company entered into a Letter Agreement (the Purchase Agreement) with the United States Department of the Treasury (the Treasury), pursuant to which the Company issued and sold (i) 7,000 shares of the Companys Series A Fixed Rate Cumulative Perpetual Preferred Stock (the Series A Preferred Stock) and (ii) a warrant (the Warrant) to purchase 158,133 shares of the Companys common stock, no par value, (the Common Stock) for an aggregate purchase price of $7,000,000 in cash. According to the agreement, if the Company received aggregate gross cash proceeds of not less than $7,000,000 from Qualified Equity Offerings on or prior to December 31, 2009, the number of shares of Common Stock issuable pursuant to the Treasurys exercise of the Warrant could be reduced by one half of the original number of shares, taking into account all adjustments, underlying the Warrant. On December 23, 2009, the Company received $8,000,000, as a result of entering into Stock Purchase Agreements to sell a total of 1,264,952 shares of common stock, without par value at $5.25 per share and 1,359 shares of non-voting Series B Convertible Adjustable Rate Non-Cumulative Perpetual Preferred Stock at $1,000 per share, for an aggregate gross purchase price of $8,000,000. The Company submitted a request to the Treasury to cancel one half of the outstanding Warrants and the Treasury reduced the number of warrants by one half to 79,067.
On December 23, 2009, the Company entered into Stock Purchase Agreements with a limited number of accredited investors to sell a total of 1,264,952 shares of common stock, without par value at $5.25 per share, and 1,359 shares of non-voting Series B Convertible Adjustable Rate Non-Cumulative Perpetual Preferred Stock (Series B Preferred Stock) at $1,000 per share, for an aggregate gross purchase price of $8,000,000. In May 2010, the shareholders of the Company approved an amendment to the Companys governing instruments to create a series of non-voting common stock. In June 2010, the Company exercised its option to require the Purchasers to exchange 1,359 shares of Series B Preferred Stock for 258,862 shares of non-voting common stock.
The Company had no stock repurchase plans in place during 2010, 2009 or 2008. In 2008 the Company repurchased 5,436 shares of common stock from shareholders who perfected their dissenters rights related to the merger with Service 1st at an average price of $10.30 for a total cost of $56,000.
The Banks operating policy since its inception has emphasized serving the banking needs of individuals and the business and professional communities in the central valley area of California. At December 31, 2010, we had total loans of $431,597,000. Total commercial and industrial loans outstanding were $96,478,000; total agricultural land and production loans outstanding were $38,787,000, total real estate construction, land development and other land loans outstanding were $32,039,000; total other real estate loans outstanding were $213,869,000, total equity loans and lines of credit were $34,521,000 and total consumer installment loans outstanding were $8,493,000. We accept real estate, listed securities, savings and time deposits, automobiles, inventory, machinery and equipment as collateral for loans.
The banking business in California generally, and our primary service area specifically, is highly competitive with respect to both loans and deposits, and is dominated by a relatively small number of major banks with many offices operating over a wide geographic area. Among the advantages such major banks have over us is their ability to finance wide-ranging advertising campaigns and to allocate their investment assets, including loans, to regions of higher yield and demand. Major banks offer certain services such as international banking and trust services which we do not offer directly but which we usually can offer indirectly through correspondent institutions. In addition, by virtue of their greater total capitalization, such banks have substantially higher lending limits than we do. Legal lending limits to an individual customer are limited to a percentage of our total capital accounts. As of December 31, 2010, the Banks legal lending limits to individual customers were $11,646,000 for unsecured loans and $19,411,000 for unsecured and secured loans combined. For borrowers desiring loans in excess of the Banks lending limits, the Bank makes, and may in the future make, such loans on a participation basis with other community banks taking the amount of loans in excess of the Banks lending limits. In other cases, the Bank may refer such borrowers to larger banks or other lending institutions.
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