One Down

Many More to Go

February 2, 2024

Bay Community Bancorp (CBOBA) has about $70 million of common equity and got $119 million of ECIP bucks. This is one of the most leveraged ways to play the ECIP bonanza. Shares trade at 93% of stated tangible book value but only 40% of adjusted TBV taking into account their ECIP funding. They have an 8% return on tangible equity which could rise towards 12% with expense savings. Credit is stable. The CEO is 64 years old without a clear successor so his best exit plan is probably selling the bank.

February 26, 2024

Since disclosing the idea, Bay Community Bancorp (CBOBA) reported that they earned $0.15 in the last quarter and that their current tangible book value is $8.55. They bought back over 200,000 shares.

May 9, 2024

Bay Community Bancorp (CBOBA) trades at about 85% of stated tangible book value but only about a third of its ECIP-adjusted tangible book value. This is around 8x its earnings. Their net interest margins are improving while their deposit costs are falling. Today their net interest margins are up to about 3.5% and deposit costs are below 2%. They bought back 20k shares this past quarter. Non-performing assets are close to zero. They are poised to earn around $0.20–25 per quarter and generate around a 10% return on tangible common equity. They should continue to buy back shares then sell the bank when their CEO retires.

May 20, 2024

CBC Bancorp will acquire Bay Community Bancorp in an all-cash transaction valued at $14.00 per common share.