Plumas Bancorp operates as a bank holding company for Plumas Bank (the ‘bank’).
The bank’s primary service area covers the Northeastern portion of California, with Lake Tahoe to the south and the Oregon border to the north, and the Northwestern portion of Nevada. The bank operates branches in California, including branches in Alturas, Chester, Chico, Fall River Mills, Greenville, Kings Beach, Portola, Quincy, Redding, Susanville, Tahoe City, Truckee, and Yuba City. The bank's newest branch was...
Plumas Bancorp operates as a bank holding company for Plumas Bank (the ‘bank’).
The bank’s primary service area covers the Northeastern portion of California, with Lake Tahoe to the south and the Oregon border to the north, and the Northwestern portion of Nevada. The bank operates branches in California, including branches in Alturas, Chester, Chico, Fall River Mills, Greenville, Kings Beach, Portola, Quincy, Redding, Susanville, Tahoe City, Truckee, and Yuba City. The bank's newest branch was opened in April 2023 and is located in Chico, California. In December 2015, the bank opened a branch in Reno, Nevada, its first branch outside of California, and in 2018, the bank purchased a branch located in Carson City, Nevada.
The bank maintains nineteen automated teller machines (‘ATMs’) tied in with major statewide and national networks. In addition to its branch network, the bank operates a lending office specializing in government-guaranteed lending in Auburn, California, with additional lenders in Utah and Southern California, and commercial/agricultural lending offices located in Chico, California, and Klamath Falls, Oregon. The bank’s primary business is servicing the banking needs of these communities. Its marketing strategy emphasizes its local ownership and commitment to serve the banking needs of individuals living and working in the bank’s primary service areas.
The bank primarily generates revenue from loans and investment securities in its portfolio and, to a lesser extent, service fees. With a predominant focus on personal service, the bank positions itself as a multi-community independent bank serving the financial needs of individuals and businesses within the bank’s geographic footprint. The bank’s principal commercial lending services include term real estate, commercial, and industrial term loans. In addition, the bank provides government-guaranteed and agricultural loans, as well as credit lines. The bank’s principal retail lending services include consumer and home equity loans. The bank provides land development and construction loans on a limited basis.
The bank provides Small Business Administration (SBA) loans to qualified borrowers mostly in Northern California, through its government-guaranteed lending center headquartered in Auburn, California. In addition to its Auburn location, the bank has an SBA lender based in San Diego, California, and an SBA lender based in South Jordan, Utah. In 2007, the bank was granted nationwide Preferred Lender status with the U.S. Small Business Administration, and it expects government-guaranteed lending to continue to be an important part of its overall lending operation. The SBA 7(a) loan product, in which the guaranteed portion is salable in the secondary market, is variable rate tied to prime, and it has seen a significant decline in interest in this product during the last two years. However, the bank has successfully pivoted to producing fixed-rate SBA 7(a) loans. It portfolios the entire fixed-rate SBA 7(a) loan.
As of December 31, 2024, the principal areas to which the bank has directed its lending activities, and the percentage of the company’s total loan portfolio consisted of each, were as follows: commercial real estate – 63.7%; agricultural loans (including agricultural real estate loans) – 11.7%; consumer loans (including residential equity lines of credit and automobile loans) – 10.6%; commercial and industrial loans – 7.6%; construction and land development – 5.3%; and residential real estate – 1.1%.
In addition to the company’s lending activities, the bank offers a wide range of deposit products for the commercial and retail banking markets, including checking, money market checking, business sweep, public funds sweep, savings, time deposit, and retirement accounts, as well as remote deposit, telephone, and mobile banking, including mobile deposit and internet banking with bill-pay options. Interest-bearing deposits include higher-yielding sweep accounts designed for its commercial customers and for public entities, such as municipalities.
Most of the bank’s deposits are attracted from individuals, business-related sources, and smaller municipal entities. This mix of deposit customers has resulted in a relatively modest average deposit balance of approximately $36 thousand as of December 31, 2024.
The bank also offers a variety of other products and services complementing its lending and deposit services. These include cashier’s checks, bank-by-mail, ATMs, night depository, safe deposit boxes, direct deposit, electronic funds transfers, FedNow-receive Service, and other customary banking services. The bank offers a Remote Deposit product that allows its business customers to make non-cash deposits remotely from their physical location. This product enables the company to extend its service area because it can now meet the deposit needs of customers who may not be located within a convenient distance of one of its branch offices.
The bank has devoted a substantial amount of time and capital to the improvement of existing bank services. During 2022, Plumas Bank upgraded and replaced the company’s fleet of ATM machines, enhanced incoming wire notifications, and developed electronic tracking and monitoring for ACH origination and Remote Deposit Capture services, and implemented the ability for the company’s commercial online banking clients to originate one-time ACH payments. In 2024, the bank upgraded its branch deposit acceptance system, entered real-time payments by implementing FedNow-receive, optimized its outgoing wire transfer capabilities, and launched Payee Match for Positive Pay to aid in combating the rising trend of check fraud. Additionally, beginning in 2024, the bank began accepting applications for its Business Exxpress product through its website.
The company’s business has a modest seasonal component due to the heavy agricultural and tourism orientation of some of the communities it serves. The company has established loan concentration guidelines as a percentage of capital and evaluates loan concentration levels within a single industry or group of related industries on a quarterly basis, or more frequently as loan conditions change.
The bank offers various loan products that encourage job growth and support community economic development. Types of loans offered range from personal and commercial loans to real estate, construction, agricultural, and government-guaranteed loans.
As of December 31, 2024, approximately 77% of the bank's total loan portfolio consisted of real estate-secured loans, including real estate mortgage loans, real estate construction loans, consumer equity lines of credit, and agricultural loans secured by real estate. Moreover, the business activities of the company is focused in the California counties of Butte, Lassen, Modoc, Nevada, Placer, Plumas, Shasta, and Sutter, and in Washoe and Carson City Counties in Northern Nevada.
Investment Portfolio
As of December 31, 2024, the company’s investment portfolio included U.S. Government-sponsored agencies collateralized by mortgage obligations-residential, U.S. Government agencies collateralized by mortgage obligations-commercial, and obligations of states and political subdivisions.
Supervision and Regulation
The company is a registered bank holding company under the Bank Holding Company Act of 1956, as amended, and is subject to supervision and regulation by the Board of Governors of the Federal Reserve System (the ‘FRB’). The company is required to file reports with the FRB, and the FRB periodically examines the company. FRB regulations and policies require the company to meet or exceed certain capital requirements and regulate provisions of certain bank holding company debt. The company is also a bank holding company for purposes of the California Financial Code, so the company and its subsidiaries are also subject to supervision and examination by the California Department of Financial Protection and Innovation (‘DFPI’).
As a bank holding company, the company must obtain prior approval from the FRB before taking any action that causes a bank to become a controlled subsidiary of the bank holding company, acquiring direct or indirect ownership of 5% of the outstanding shares of any class of voting securities of another bank or bank holding company, acquiring all or substantially all the assets of a bank, or merging or consolidating with another bank holding company.
As a California-chartered commercial bank that is a member of the Federal Reserve System, the bank is subject to the supervision and regulation of the DFPI and the FRB, as well as certain regulations of the FDIC and the Consumer Financial Protection Bureau (‘CFPB’).
As a member of the Federal Reserve System, the bank is required to purchase and maintain stock in the Federal Reserve Bank of San Francisco in an amount equal to 3.00% of the paid-up capital stock and surplus of the bank and have available another 3.00% in reserves.
The company qualifies for treatment under this policy and is not currently subject to the Basel III consolidated capital rules at the bank holding company level. The Basel III capital rules continue to apply to the bank.
The company’s ability to pay cash dividends is limited by California law and is dependent on dividends it may receive from the bank. The California General Corporation Law permits a California corporation, such as the company, to make a distribution to its shareholders if its retained earnings equal at least the amount of the proposed distribution, or if after giving effect to the distribution, the value of the corporation’s assets exceeds the amount of its liabilities plus the amount of shareholders' preferences, if any, and certain other conditions are met.
Federal banking regulators consider the bank’s Community Reinvestment Act (‘CRA’) performance in evaluating applications for mergers, acquisitions, and to establish new branches. A less than ‘Satisfactory’ rating would likely result in the suspension of any growth of the bank through acquisitions or opening de novo branches until the rating is improved. The bank’s most recent CRA rating was ‘Satisfactory.’
The bank is subject to certain restrictions imposed by the Federal Reserve Act on extensions of credit to executive officers, directors, principal shareholders (including the company), or any related interest of such persons.
The Federal Reserve Act and the FRB’s Regulation W limit the amount of certain loan and investment transactions between the bank and its affiliates, require certain levels of collateral for such loans, and limit the amount of advances to third parties that may be collateralized by the securities of the company or its subsidiaries.
The Federal Deposit Insurance Corporation (the ‘FDIC’) insures the bank’s deposits, up to prescribed statutory limits, through the Deposit Insurance Fund, currently $250,000 per depositor per institution.
While the FRB is the bank’s primary federal regulator, as a federally insured depository institution, the bank is also subject to certain regulations of and supervision by the FDIC.
The company is subject to many federal and state consumer protection and privacy statutes and regulations, including but not limited to the following: the Equal Credit Opportunity Act, the Truth in Lending Act (‘TILA’), the Fair Housing Act (‘FH Act’), the Home Mortgage Disclosure Act (‘HMDA’), the Right to Financial Privacy Act, and the Real Estate Settlement Procedures Act (‘RESPA’).
Smaller institutions, including the bank, are generally subject to rules promulgated by the CFPB but continue to be examined and supervised by their primary federal banking regulators for consumer compliance purposes.
The California Department of Financial Protection and Innovation (‘DFPI’) also has authority to bring similar enforcement actions against the bank.
The company’s earnings and growth are affected not only by general economic conditions, but also by the fiscal and monetary policies of the federal government, particularly the FRB.
History
Plumas Bancorp was founded in 1980. The company was incorporated in 2002.
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