Parent Company Financial Information

12 Months Ended

Dec. 31, 2015

Parent Company Financial Information

Parent Company Financial Information

Note 20. Parent Company Financial Information

Heritage Oaks Bancorp
Condensed Balance Sheets

	December 31,
	2015		2014
		(dollars in thousands)
Assets
Cash	$	6,034	$	6,642
Prepaid and other assets		2,077		2,122
Investment in subsidiary		208,916		202,565
Total assets	$	217,027	$	211,329
Liabilities
Junior subordinated debentures	$	10,438	$	13,233
Other liabilities		155		156
Total liabilities		10,593		13,389
Shareholders' Equity
Preferred stock		-		1,056
Common stock		165,517		164,196
Additional paid in capital		8,251		6,984
Retained earnings		32,200		24,772
Accumulated other comprehensive income		466		932
Total shareholders' equity		206,434		197,940
Total liabilities and shareholders' equity	$	217,027	$	211,329

Heritage Oaks Bancorp
Condensed Statements of Income

	For the Years Ended December 31,
	2015			2014			2013
		(dollars in thousands)
Income
Dividends from subsidiaries	$	10,000		$	10,000		$	25,309
Gain on extinguishment of debt		450			-			-
Interest income		17			16			19
Total income		10,467			10,016			25,328
Expense
Interest expense		540			499			167
Share-based compensation		294			211			133
Other professional fees and outside services		573			737			1,169
Total expense		1,407			1,447			1,469
Income before income tax benefit and equity in undistibuted earnings of subsidiaries		9,060			8,569			23,859
Income tax benefit		(395	)		(576	)		(347	)
Net income before equity in undistributed earnings of subsidiaries		9,455			9,145			24,206
Equity in undisbursed income of subsidiaries		5,894			(180	)		(13,365	)
Dividends and accretion on preferred stock		(70	)		(168	)		(898	)
Net income available to common shareholders	$	15,279		$	8,797		$	9,943

Heritage Oaks Bancorp
Condensed Statements of Comprehensive Income

	For the Years Ended December 31,
	2015			2014			2013
		(dollars in thousands)
Net income	$	15,349		$	8,965		$	10,841
Other comprehensive (loss) income, net of tax:
Unrealized holding (losses) gains on securities arising during the period		(164	)		8,075			(8,565	)
Reclassification for net gains on investments included in net income		(641	)		(646	)		(3,926	)
Other comprehensive (loss) income, before income tax expense (benefit)		(805	)		7,429			(12,491	)
Income tax (benefit) expense related to items of other comprehensive income		(339	)		3,072			(5,141	)
Other comprehensive (loss) income		(466	)		4,357			(7,350	)
Comprehensive income	$	14,883		$	13,322		$	3,491

Heritage Oaks Bancorp
Condensed Statements of Cash Flows

	For the Years Ended December 31,
	2015			2014			2013
		(dollars in thousands)
Cash flows from operating activities:
Net income	$	15,349		$	8,965		$	10,841
Adjustments to reconcile net income to net cash used in operating activities:
Share-based compensation expense		294			211			133
Amortization of premium on borrowings		199			175			-
Gain on extinguishment of debt		(450	)		-			-
Undistributed (income) loss of subsidiaries		(5,894	)		180			13,365
Decrease (increase) in other assets and other liabilities, net		30			(868	)		(83	)
Net cash provided by operating activities		9,528			8,663			24,256
Cash flows from investing activities:
Cash used in MISN Transaction, net		-			(3,928	)		-
Proceeds from the sale of assets		-			338			-
Other		-			(100	)		-
Net cash used in investing activities		-			(3,690	)		-
Cash flows from financing activities:
Proceeds from the exercise of options		293			453			138
Repurchase of common stock		(28	)		(387	)		-
Decrease in junior subordinated debentures		(2,550	)		-			-
Dividends paid		(7,851	)		(2,742	)		-
Dividends on Series A preferred stock		-			-			(708	)
Retirement of Series A preferred stock and related warrants		-			-			(22,575	)
Stock issuance costs		-			(381	)		-
Net cash used in financing activities		(10,136	)		(3,057	)		(23,145	)
Net increase in cash and cash equivalents		(608	)		1,916			1,111
Cash and cash equivalents, beginning of year		6,642			4,726			3,615
Cash and cash equivalents, end of year	$	6,034		$	6,642		$	4,726