Coastal Financial: A Community Bank With Growth Opportunities

Community banks have had a tough year, with the collapse of Silicon Valley Bank, First Republic Bank and Signature Bank hitting the domestic banking industry.

Standing out to weather the storm was Coastal Financial Corp. (CCB, Finance) is the bank holding company for Coastal Community Bank, a large community bank that provides banking products and services in the Puget Sound area, including the cities of Seattle and Tacoma. These include checking and savings accounts, business and industrial loans, mortgages and other banking products.

Additionally, Coastal Financial provides banking-as-a-service to digital financial services firms and broker-dealers through its CCBX division. With total assets in excess of $3.5 billion, the firm has 14 offices in the Seattle area, making these services readily available. The company prides itself on being the community bank with the largest deposit market share.

The company recently reported Q2 financial results, which showed solid deposit growth and as well as earnings per share growth. Total revenue increased 16.5% during the quarter while deposits rose $67.3 million to $3.16 billion. Net income was $12.9 million, or 95 cents per share, which compares to $12.4 million, or 91 cents, for the prior-year period.

Return on average assets was 1.52% for the quarter and return on average equity was 19.53%, which were both improvements over the prior-year period. Total assets increased 2.4% to $3.54 billion for the quarter, which compares to $3.45 billion as of March 31. Net loan growth increased 6% to $3.01 billion during the quarter.