SAN FRANCISCO, July 24, 2017 (GLOBE NEWSWIRE) -- New Resource Bank (OTC Link LLC:NWBN) reports higher earnings in the second quarter of 2017 compared to a year ago, reflecting strong growth in revenues, loans and deposits and solid asset quality. All financial results are unaudited.
Net income for the second quarter of 2017 was $394,000, or $0.07 per share, a 49% increase versus net income of $265,000, or $0.05 per share, for the second quarter of 2016, and up 28% from $308,000, or $0.05 per share, for the first quarter of 2017. Key factors impacting the annual comparison included a 17% increase in revenue largely due to strong loan growth, partially offset by a 17% increase in operating expense due to investments in staffing and technology.
As of June 30, 2017, gross loans stood at $259.6 million, an increase of 14%, or $31.8 million, compared to a year ago, and 2%, or $4.5 million, from March 31, 2017. Factors influencing the robust loan growth included the continuing appeal of New Resource Bank’s triple-bottom-line mission, as well as its target-market expertise. Total deposits grew 16% to $309.0 million, from $267.0 million a year ago, and were relatively unchanged from the preceding quarter. Asset quality remains strong, with non-performing assets to total assets at 0.07%, down from 0.18% a year ago and up from 0.01% in the preceding quarter. There was a charge-off of $136,000 in the second quarter, compared to a net recovery of $183,000 recorded in the preceding quarter.
“We are committed to putting deposits to work for good and to advancing sustainability through lending to green and socially responsible companies,” said Vince Siciliano, President and CEO. Socially responsible investing continues to attract investors and is estimated to account for $8.72 trillion in 2016, or one in five dollars under professional management, by the US SIF Foundation in its “Report of Sustainable and Responsible Investing Trends in the United States in 2016. Visit http://www.ussif.org/trends.
“New Resource Bank continues to demonstrate that banking can be both mission-driven and profitable,” Siciliano added. “Loan demand from green builders, organic producers, clean energy providers and not-for profit enterprises is robust. Likewise, more and more business owners and consumers are looking to make a positive impact in their communities and the planet by aligning their savings and deposits with their values. These trends continue to fuel our growth and profitability.”
Key financial results from the second quarter of 2017 compared with the second quarter of 2016 include:
- Return on Average Assets was 0.11% for the second quarter of 2017 and 0.08% for the second quarter of 2016.
- Return on Average Equity was 0.95% for the second quarter of 2017 and 0.66% for the second quarter of 2016.
- Loan growth: Loans outstanding grew 14%, to $259.6 million from $227.8 million a year ago.
- Deposits: Deposits rose 16%, to $309.0 million from $267.0 million one year ago.
- Total assets: Total assets increased 14%, to $353.2 million from $309.4 million a year ago.
- Net interest income: Net interest income for the second quarter of 2017 was $3.5 million, an increase of $479,000, or 16%, from the second quarter of 2016.
- Non-interest expense: Non-interest expense for the second quarter was $2.9 million, an increase of $419,000, or 17%, from a year ago and down $219,000 or -7%, from the first quarter of 2017 which included $230,000 in non-recurring items for compensation and technology upgrades.
- Provision expense: Provision expense for the quarter was $254,000, down 15% from $300,000 during the second quarter of 2016.
- Asset quality: Credit quality continues to be excellent, with non-performing assets to total assets at 0.07%, down from 0.18% a year ago and up from 0.01% in the preceding quarter.
- Efficiency ratio: The bank’s efficiency ratio for the second quarter was 77%, virtually unchanged compared to the second quarter of 2016.
- Risk-based capital: Common equity tier 1 capital ratio amounted to 12.50% and total risk-based capital ratio was 13.75%, significantly above the standard for a well-capitalized bank.
“The investments we are making in attracting and retaining excellent bankers is an important factor in our growth,” stated Mark A. Finser, Chairman of the Board, New Resource Bank. “While our customers are looking for socially responsible and green banking, they also expect and deserve superior service. We believe we deliver both mission-driven business practices and world-class banking services to our clients.”
About New Resource Bank
New Resource Bank (www.newresourcebank.com) is a triple-bottom-line bank serving values-driven businesses and nonprofits that are building a more sustainable world. We see money as an agent of positive social, environmental and economic change. We use banking to transform the economy into one that serves all people and the planet. We put deposits to work for good by lending to organizations that benefit our communities and protect our planet. By using banking to promote well-being, we aim to have an impact in four key areas: environmental protection; health & wellness; education & community empowerment; and sustainable commerce.
The company’s internal commitment to sustainability is equally crucial and demonstrated in many ways, notably through our LEED-certified San Francisco headquarters, our purchase of carbon offsets, our 87% waste diversion rate and generous employee benefits. In 2010, New Resource Bank became the first publicly traded, Certified B Corporation. B Corporations meet comprehensive social and environmental performance standards. For five consecutive years, New Resource Bank has earned the ‘B Corp Best for the World’ award. This list honors businesses that earned an overall score in the top 10% of more than 1,200 Certified B Corporations from over 120 industries on the B Impact Assessment, a rigorous and comprehensive assessment of a company’s impact on its workers, community and the environment.
This press release contains forward-looking statements such as statements about certain expectations and projections, and the bank’s preparedness for the coming year. Forward-looking statements are based on currently available information, are not guarantees of future performance and are subject to numerous risks and uncertainties. Such risks and uncertainties may include, but are not necessarily limited to, fluctuations in interest rates; fluctuations in asset prices, including real estate; inflation; changes in laws or government regulations or policies; general economic conditions, including the real estate market in California; the adequacy of the bank’s allowance for loan losses; and other factors beyond the bank’s control. Such risks and uncertainties could cause results for subsequent interim periods or for entire years to differ materially from those indicated. Readers should not place undue reliance on forward-looking statements, which reflect management’s view only as of the date of this press release. The bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.
| (in thousands) | |||||||||||||||||
| Balance Sheet | June 30, 2017 | March 31, 2017 | % Change | June 30, 2016 | % Change | ||||||||||||
| Assets | |||||||||||||||||
| Cash & Due From | $ | 10,762 | $ | 10,446 | 3.0 | % | $ | 14,028 | -23.3 | % | |||||||
| Interest Bearing Deposits | 42,755 | 45,935 | -6.9 | % | 25,355 | 68.6 | % | ||||||||||
| Money Market Funds | - | - | 0.0 | % | - | 0.0 | % | ||||||||||
| Fed Funds | - | - | 0.0 | % | - | 0.0 | % | ||||||||||
| Investments | 27,584 | 28,366 | -2.8 | % | 28,602 | -3.6 | % | ||||||||||
| Gross Loans | 259,596 | 255,052 | 1.8 | % | 227,806 | 14.0 | % | ||||||||||
| Allowance for Loan Loss | (3,985 | ) | (3,865 | ) | 3.1 | % | (3,715 | ) | 7.3 | % | |||||||
| Premises & Equipment | 2,253 | 2,325 | -3.1 | % | 2,534 | -11.1 | % | ||||||||||
| Other Real Estate Owned | - | - | 0.0 | % | 87 | NM | |||||||||||
| Other Assets | 14,188 | 14,245 | -0.4 | % | 14,664 | -3.2 | % | ||||||||||
| Total Assets | $ | 353,153 | $ | 352,503 | 0.2 | % | $ | 309,362 | 14.2 | % | |||||||
| Liabilities & Equity | |||||||||||||||||
| Deposits | $ | 309,032 | $ | 309,380 | -0.1 | % | $ | 266,971 | 15.8 | % | |||||||
| Borrowings | - | - | 0.0 | % | - | 0.0 | % | ||||||||||
| Other Liabilities | 2,732 | 2,269 | 20.4 | % | 2,287 | 19.5 | % | ||||||||||
| Total Liabilities | 311,764 | 311,649 | 0.0 | % | 269,259 | 15.8 | % | ||||||||||
| Equity | 41,389 | 40,854 | 1.3 | % | 40,103 | 3.2 | % | ||||||||||
| Total Liabilities & Equity | $ | 353,153 | $ | 352,503 | 0.2 | % | $ | 309,362 | 14.2 | % | |||||||
| Book value per outstanding share | $ | 7.02 | $ | 7.01 | $ | 6.90 | |||||||||||
| Leverage ratio | 10.74 | % | 10.94 | % | 11.21 | % | |||||||||||
| Total risk based capital ratio | 13.75 | % | 13.76 | % | 14.43 | % | |||||||||||
| BASEL III Common Equity Tier 1 | 12.50 | % | 12.50 | % | 13.17 | % | |||||||||||
| Loan loss reserves to total loans | 1.54 | % | 1.52 | % | 1.63 | % | |||||||||||
| Loan loss reserves to non-performing loans | 1696 | % | 9972 | % | 809 | % | |||||||||||
| Non-performing loans to total loans | 0.09 | % | 0.02 | % | 0.20 | % | |||||||||||
| Non-performing assets to total assets | 0.07 | % | 0.01 | % | 0.18 | % | |||||||||||
| Income Statement | Quarter Ended | ||||||||||||||||
| June 30, 2017 | March 31, 2017 | % Change | June 30, 2016 | % Change | |||||||||||||
| Interest Income | $ | 3,503 | $ | 3,351 | 4.5 | % | $ | 3,026 | 15.8 | % | |||||||
| Interest Expense | 36 | 32 | 12.5 | % | 36 | 0.0 | % | ||||||||||
| Net Interest Income | 3,468 | 3,318 | 4.5 | % | 2,989 | 16.0 | % | ||||||||||
| Non-Interest Income | 316 | 304 | 3.9 | % | 248 | 27.4 | % | ||||||||||
| Provision for Loan Loss | 254 | - | NM | 300 | NM | ||||||||||||
| Non-Interest Expense | 2,914 | 3,133 | -7.0 | % | 2,495 | 16.8 | % | ||||||||||
| Net Operating Income/(Loss) | 616 | 489 | 26.0 | % | 442 | 39.4 | % | ||||||||||
| Taxes | 222 | 181 | 22.7 | % | 177 | 25.4 | % | ||||||||||
| Net Income/(Loss) | $ | 394 | $ | 308 | 27.9 | % | $ | 265 | 48.7 | % | |||||||
| Net Interest Margin | 4.26 | % | 4.30 | % | -0.9 | % | 4.08 | % | 4.3 | % | |||||||
| Efficiency Ratio | 77.02 | % | 86.50 | % | -11.0 | % | 77.08 | % | -0.1 | % | |||||||
| NM = Not Meaningful | |||||||||||||||||
| N/A = Not Available | |||||||||||||||||