CoBiz Financial, Inc. :COBZ-US: Earnings Analysis: Q4, 2016 By the Numbers : February 1, 2017

CoBiz Financial, Inc. reports financial results for the quarter ended December 31, 2016.

We analyze the earnings along side the following peers of CoBiz Financial, Inc. – Guaranty Bancorp, Western Alliance Bancorporation, Glacier Bancorp, Inc., Cullen/Frost Bankers, Inc., First Interstate BancSystem, Inc. Class A, Zions Bancorporation, National Bank Holdings Corporation Class A, Pinnacle Financial Partners, Inc. and KeyCorp (GBNK-US, WAL-US, GBCI-US, CFR-US, FIBK-US, ZION-US, NBHC-US, PNFP-US and KEY-US) that have also reported for this period.


  • Summary numbers: Revenues of USD 38.31 million, Net Earnings of USD 8.73 million.
  • Net interest income margins narrowed from 78.65% to 78.02% compared to the same period last year.
  • Net loan assets changed 9.11% compared to same period last year and 3.84% from previous period, total deposits changed 10.51% compared to same period last year and 3.15% from previous period.
  • Earnings growth from operating margin improvements as well as from one-time items.

The table below shows the preliminary results and recent trends for key metrics such as revenues and net income (See complete table at the end of this report):

2016-12-31 2016-09-30 2016-06-30 2016-03-31 2015-12-31
Relevant Numbers (Quarterly)
Revenues (mil) 38.31 37.44 36.08 35.71 35.9
Revenue Growth (%YOY) 6.71 7.6 1.49 1.62 2.78
Earnings (mil) 8.73 10.15 8.44 7.28 4.35
Earnings Growth (%YOY) 100.85 47.79 15.67 -0.29 -36.98
Net Margin (%) 22.8 27.12 23.38 20.38 12.11
EPS 0.21 0.25 0.21 0.18 0.11
Return on Equity (%) 11.68 13.96 11.97 10.56 6.4
Return on Assets (%) 0.99 1.18 0.99 0.87 0.52

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Market Share Versus Profits

Revenues History
Earnings History

COBZ-US‘s change in revenue this period compared to the same period last year of 6.71% is almost the same as its change in earnings, and is about average among the announced results thus far in its peer group, suggesting that COBZ-US is holding onto its market share. Also, for comparison purposes, revenues changed by 2.33% and earnings by -13.99% compared to the immediate last period.

Revenues Growth Versus Earnings Growth

Quadrant label definitions. Hover to know more

Leader, Earnings Focus, Laggard, Revenues Focus

Earnings Growth Analysis

The company’s net interest income margins showed no year-on-year improvement. In spite of this, the earnings rose, influenced primarily by the increase in net interest income after provisions margins from 63.64% to 77.11%. Loan loss provisions as a percentage of net interest income were 1.17% this period, and 19.09% a year ago.

Net Interest Income Margin Versus Loan Loss Provisions Margin

Quadrant label definitions. Hover to know more

High Risk; High Reward Loans, Risky Loan Portfolio, Conservative Loan Portfolio, Safer Loan Portfolio
Net Interest Income Margin History
Loan Loss Provisions Margin History

Net Loans and Total Deposits

A financial institution’s core operations represented by Net Interest Income and Net Interest Income after Provisions are dependent on both the growth and quality of its deposits as well as the growth and quality of its loans. A firm could boost its interest income in the short-term by just increasing its loan assets with less concern about their quality – but this would eventually lead to greater loan loss provisions. Similarly a drive to increase deposits could result in higher interest expenses and eventually effect the firm’s equity. It is thus important to understand net interest income performance in context to loan loss provisions, loan assets and deposits.

Loan Assets Growth Rate History (Qtr YOY)
Total Deposits Growth Rate History (Qtr YOY)

The firm’s decline in net interest income margins was influenced by both the relative drops in the levels of net loan assets and the level of total deposits as a percentage of equity. On an absolute basis, net loan assets changed 9.11% compared to the same period last year and 3.84% from the previous period. Total deposits changed 10.51% compared to the same period last year and 3.15% from the previous period.


The company’s earnings growth has also been influenced by the following factors: (1) Improvements in operating margins from 12.98% to 30.31% and (2) one-time items. The company’s pretax margins are now 30.87%, compared to 14.25% for the same period last year.

EBIT Margin History
PreTax Margin History
EBIT Margin Versus PreTax Margin

Quadrant label definitions. Hover to know more

Operation driven Earnings, One-time Favorables, Low Earnings Base, One-time Unfavorables

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Company Profile

CoBiz Financial, Inc. operates as a diversified financial services company. The company operates through three business segments: Commercial Banking, Fee-Based Lines and Corporate Support & Other. The Commercial Banking segment consists of the operations of Colorado Business Bank and Arizona Business Bank, which offers real estate banking, private banking, interest-rate hedging, depository products and treasury management. The Fee-Based Lines segment divided into three segments those are Investment, Wealth Management and Insurance. The Investment Banking segment consists of the operations of Green Manning & Bunch, which provides middle-market companies with merger and acquisition advisory services, institutional private placements of debt and equity, and other strategic financial advisory services. The Wealth Management segment consists of the operations of CoBiz Investment Management, LLC. and CoBiz Trust and Financial Designs Ltd., which offers customized client investment policy, proprietary bond and equity offerings, tailored asset allocation strategies, trust administration, estate and business succession planning, carefully vetted investment options utilizing external managers, investment management, estate settlements, financial planning and family office services. The Insurance segment consists of the operations of CoBiz Insurance, Inc. and Financial Designs Ltd., which offers employee benefits and retirement planning, executive compensation and benefits planning, individual benefits, commercial lines, professional lines, private client and risk management services. The Corporate Support & Other segment is composed of activities of the parent company; non-production, back-office support operations; and eliminating transactions in consolidation. The non-production, back-office operations include human resources, accounting and finance, information technology, and loan and deposit operations. CoBiz Financial was founded on February 19, 1980 and is headquartered in Denver, CO.

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