CU Bancorp, the Encino parent of California United Bank, said its net income for the first quarter ended March 31 fell 39% to $986,000 from $1.62 million a year before, mainly because the bank increased its quarterly contribution to reserves for possible loan losses.
CU had assets of $487 million as of March 31, a 2% decline from $498 million a year before.
CU's loan loss provision for the first quarter was $1.14 million, compared with $300,000 a year ago. But CU's non-performing loans fell to $4.9 million, or 1.7% of total loans, as of March 31, from $7.2 million a year before. Non-performing loans increased from $4.0 million as of Dec. 31.
CU's net-interest income and fee income from mortgage banking increased for the quarter, according to John J. Keating, the company's chief executive. But the increases were offset by the larger loan loss provision.
In addition, CU said it realized loan loss recoveries of more than $500,000 after the end of the first quarter and that they will be reflected in second quarter results.