Posts First Profitable Quarter Since Inception
Exceeds $100 Million in Assets
FREEHOLD, N.J., July 21, 2010 (GLOBE NEWSWIRE) -- New Jersey Community Bank (OTCBB:NJCB) (the "Bank") reported net income of $11 thousand, or $0.01 per common share for the three months ended June 30, 2010, compared with a net loss of $378 thousand, or ($0.23) per common share for the same period in the prior year.
"Despite a challenging marketplace and the current economic conditions, this was our first profitable quarter since our inception in July 2008 and we surpassed $100 million in total assets," commented Robert D. O'Donnell, Chairman and CEO. "I am extremely grateful to our dedicated employees and our shareholders who helped us to achieve these milestones. We remain steadfast on our business plan of accepting deposits and making loans to qualified customers in the communities that we serve. We remain cautiously optimistic (as we steer through these difficult times) on continued expansion of our franchise and build shareholder value."
James A. Kinghorn, President and COO added that, "We are pleased with the Bank's operating performance. Most notably, we see an overall growth in our core business, continued growth of deposits and loans. Much of the improvement in our earnings is attributed to increase in loan interest income coupled with our ongoing efforts to manage our funding costs and overhead expenses." Mr. Kinghorn continued, "We believe our commitment to quality loans and consistent underwriting standards should allow us to prevail as the economy continues to work through the recession."
Balance Sheet Summary
At June 30, 2010, total assets were $105.2 million, an increase of $17.0 million, or 19.3%, over $88.2 million reported at December 31, 2009, primarily as a result of increases in interest-bearing due from banks, investment securities and loans, partially offset by a decrease in cash and cash equivalents. Cash and cash equivalents decreased $2.0 million, or 11.4%, to $15.9 million at June 30, 2010, from $17.9 million at December 31, 2009. The reduction in cash balances was used in part to fund the increase in interest-bearing due from banks.
Investment securities increased $2.8 million, or 35.8%, to $10.5 million at June 30, 2010, from $7.8 million reported at December 31, 2009. Total loans increased $15.1 million, or 25.9%, to $73.5 million at June 30, 2010, from $58.4 million reported at December 31, 2009. The increases in both the investment securities and the loans were funded utilizing the liquidity arising from the growth in deposits.
Total deposits grew by $16.9 million, or 22.6%, to $91.9 million during the first six months of the year 2010. Core deposits, consisting of savings, NOW, money market and demand deposit accounts increased $7.8 million or 48.2%. Time deposits increased $9.1 million or 15.5%. Shareholders' equity totaled $13.1 million as of June 30, 2010. The Bank's capital ratios exceed the regulatory requirements of a well capitalized financial institution.
Results of Operations
For the quarter ended June 30, 2010, net interest income totaled $813 thousand, increasing $459 thousand over the same period in the prior year. The increase in net interest income was primarily due to a combination of both a 66 basis points decrease in cost of average interest bearing liabilities and a 40 basis points increase in yield on earning assets. Interest income for the quarter ended June 30, 2010 totaled $1.2 million while the interest expense totaled $364 thousand. Net interest margin was 3.36% for the quarter ended June 30, 2010, an increase of 66 basis points over the comparable quarter in 2009, an increase of 28 basis points from 3.08% for the linked quarter ended March 31, 2010.
The provision for loan loss was $103 thousand for the quarter ended June 30, 2010, compared with $155 thousand in the year-ago quarter, a decline of $52 thousand. Mr. O'Donnell and Mr. Kinghorn also noted, "Given our loan portfolio mix and the level of our non-performing loans, we believe that we have provided adequate reserves." At June 30, 2010, non-performing loans totaled $162 thousand and there were no charge-offs during the quarter. The allowance for loan loss at period-end was $880 thousand, or 1.20% of total loans.
Non-interest income increased $62 thousand, to $96 thousand for the quarter ended June 30, 2010 compared with $34 thousand for the same quarter in the prior year. Majority of such increase is directly related to the increase in fees and service charges on deposit accounts.
Non-interest expense totaled $795 thousand for the quarter ended June 30, 2010, an increase of $185 thousand from year-ago quarter, primarily due to the growth of the bank. Of the total increase, salaries and employee benefits increased $130 thousand due to addition of personnel.
About the Bank
New Jersey Community Bank is a state-chartered commercial bank headquartered in Freehold, New Jersey. The Bank operates two full-service banking offices in the central New Jersey county of Monmouth. The Bank provides traditional commercial and retail banking services to small businesses and consumers. For additional information about New Jersey Community Bank, please visit www.njcbk.com or call 732-431-2265.
The New Jersey Community Bank logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=7748
Forward-Looking Statements
This release contains forward-looking statements relating to present or future trends or factors affecting the banking industry, and specifically the financial condition and results of operations, including without limitation, statements relating to the earnings outlook of the Bank, as well as its operations, markets and products. Actual results could differ materially from those indicated. Among the important factors that could cause results to differ materially are interest rate changes, change in economic climate, which could materially impact credit quality trends and the ability to generate loans, changes in the mix of the Bank's business, competitive pressures, changes in accounting, tax or regulatory practices or requirements, resolution of tax reviews, and those risk factors detailed in the Bank's periodic reports. The Bank undertakes no obligation to release revisions to these forward-looking statements or reflect events or circumstances after the date of this release.
| New Jersey Community Bank | |||||
| Selected Financial Highlights | |||||
| (unaudited) | |||||
| For the Quarter Ended | |||||
| ($s in thousands, except per share data) | 6/30/2010 | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 |
| SUMMARY of OPERATIONS: | |||||
| Interest income | $ 1,177 | $ 1,022 | $ 928 | $ 767 | $ 584 |
| Interest expense | 364 | 349 | 327 | 296 | 231 |
| Net interest income | 813 | 673 | 601 | 471 | 353 |
| Provision for loan loss | 103 | 113 | 382 | 114 | 155 |
| Non-interest income | 96 | 91 | 64 | 53 | 34 |
| Non-interest expense | 795 | 763 | 700 | 629 | 610 |
| Net income | 11 | (112) | (417) | (219) | (378) |
| Average shares outstanding | 1,649 | 1,649 | 1,649 | 1,649 | 1,649 |
| Average diluted shares outstanding | 1,649 | 1,649 | 1,649 | 1,649 | 1,649 |
| Earnings (loss) per share: | |||||
| Basic | $ 0.01 | $ (0.07) | $ (0.25) | $ (0.13) | $ (0.23) |
| Diluted | 0.01 | (0.07) | (0.25) | (0.13) | (0.23) |
| Book value per share | $ 7.95 | $ 7.90 | $ 7.96 | $ 8.20 | $ 8.33 |
| SELECTED FINANCIAL RATIOS: | |||||
| Return on average assets | 0.04% | -0.49% | -2.00% | -1.25% | -2.72% |
| Return on average common equity | 0.34% | -3.41% | -10.64% | -5.70% | -10.06% |
| Net interest margin | 3.36% | 3.08% | 3.01% | 2.83% | 2.70% |
| Efficiency ratio | 87.47% | 99.85% | 105.26% | 120.04% | 157.62% |
| Loan to deposit ratio | 79.98% | 84.38% | 77.84% | 80.35% | 89.12% |
| CAPITAL RATIOS: | |||||
| Average equity to average assets | 13.00% | 14.40% | 18.79% | 21.88% | 27.00% |
| Tier 1 leverage capital ratio | 13.04% | 14.32% | 15.71% | 19.22% | 24.62% |
| Tier 1 risk-based capital ratio | 16.36% | 17.22% | 19.76% | 22.90% | 26.99% |
| Total risk-based capital ratio | 17.46% | 18.24% | 20.76% | 23.89% | 27.91% |
| As of | |||||
| 6/30/2010 | 3/31/2010 | 12/31/2009 | 9/30/2009 | 6/30/2009 | |
| FINANCIAL CONDITION: | |||||
| End of period balances: | |||||
| Investment securities | $ 10,529 | $ 7,215 | $ 7,750 | $ 7,491 | $ 1,973 |
| Loans, net of unearned income | 73,534 | 68,421 | 58,393 | 51,948 | 43,375 |
| Total earning assets (before allowance) | 101,539 | 90,526 | 81,252 | 74,499 | 57,080 |
| Total assets | 105,244 | 94,210 | 88,209 | 78,272 | 62,543 |
| Deposits | 91,938 | 81,085 | 75,014 | 64,652 | 48,668 |
| Shareholder's equity | 13,114 | 13,034 | 13,127 | 13,526 | 13,733 |
| Average balances: | |||||
| Investment securities | $ 8,413 | $ 7,718 | $ 7,456 | $ 2,692 | $ 1,518 |
| Loans | 71,798 | 63,516 | 56,574 | 46,901 | 35,399 |
| Total earning assets (before allowance) | 96,783 | 87,352 | 79,975 | 66,656 | 52,403 |
| Total assets | 100,425 | 91,027 | 83,413 | 70,196 | 55,685 |
| Deposits | 87,194 | 77,731 | 65,193 | 52,228 | 41,641 |
| Shareholder's equity | 13,059 | 13,106 | 15,672 | 15,356 | 15,033 |
| ASSET QUALITY: | |||||
| Gross loan charge-offs | $ -- | $ -- | $ 300 | $ -- | $ -- |
| Net loan charge-offs | -- | -- | 300 | -- | -- |
| Allowance for loan losses | 880 | 777 | 664 | 582 | 468 |
| Past due and nonaccrual loans | 162 | 83 | 117 | -- | -- |
| Allowance for loan losses to total loans | 1.20% | 1.14% | 1.14% | 1.12% | 1.08% |
| Past due and nonaccrual loans to total loans | 0.22% | 0.12% | 0.20% | 0.00% | 0.00% |
| Net loan charge-offs to average loans | 0.00% | 0.00% | 0.53% | 0.00% | 0.00% |
| New Jersey Community Bank | ||
| Statements of Financial Condition | ||
| (dollars in thousands) | ||
|
June 30, 2010 |
December 31, 2009 |
|
| Assets | (unaudited) | |
| Cash and due from banks-non-interest bearing | $ 1,344 | $ 839 |
| Federal funds sold | 14,560 | 17,109 |
| Total Cash and Cash Equivalents | 15,904 | 17,948 |
| Due from banks - interest bearing | 2,916 | 1,524 |
| Investment Securities: | ||
| Available-for-sale | 10,273 | 7,495 |
| Held-to-maturity | 256 | 256 |
| Total Investment Securities | 10,529 | 7,751 |
| Loans Receivable, net of unearned income | 73,534 | 58,392 |
| Less: Allowance for loan losses | (880) | (664) |
| Net Loans | 72,654 | 57,728 |
| Premises and equipment, net | 2,618 | 2,652 |
| Accrued interest receivable | 240 | 206 |
| Other assets | 383 | 400 |
| Total Assets | $ 105,244 | $ 88,209 |
| Liabilities and Shareholders' Equity | ||
| Liabilities | ||
| Deposits: | ||
| Non-interest bearing | $ 5,909 | $ 4,382 |
| Savings, NOW and money market | 18,052 | 11,789 |
| Time deposits under $100M | 21,459 | 22,816 |
| Time deposits $100M and over | 46,518 | 36,027 |
| Total Deposits | 91,938 | 75,014 |
| Accrued interest payable | 3 | 3 |
| Other liabilities | 189 | 66 |
| Total Liabilities | 92,130 | 75,083 |
| Shareholders' Equity | ||
| Common stock, $2 par value; authorized 10,000,000 shares; issued and outstanding 1,648,783 shares | 3,298 | 3,297 |
| Surplus | 13,434 | 13,348 |
| Accumulated Deficit | (3,639) | (3,538) |
| Accumulated other comprehensive income | 21 | 19 |
| Total Shareholders' Equity | 13,114 | 13,126 |
| Total Liabilities and Shareholders' Equity | $ 105,244 | $ 88,209 |
| New Jersey Community Bank | ||||
| Statements of Operations | ||||
| (dollars in thousands, except per share data) | ||||
|
Three Months Ended June 30, |
Six Months Ended June 30, |
|||
| 2010 | 2009 | 2010 | 2009 | |
| Interest Income | (unaudited) | (unaudited) | ||
| Loans receivable, including fees | $1,113 | $559 | $2,075 | $947 |
| Investment securities | 49 | 13 | 96 | 17 |
| Federal funds sold | 77 | 5 | 14 | 12 |
| Due from banks - interest bearing | 8 | 7 | 14 | 9 |
| Total Interest Income | 1,177 | 584 | 2,199 | 984 |
| Interest Expense | ||||
| Deposits | 364 | 231 | 713 | 424 |
| Total Interest Expense | 364 | 231 | 713 | 424 |
| Net Interest Income before Provision for Loan Loss | 813 | 353 | 1,486 | 560 |
| Provision for Loan Loss | 103 | 155 | 216 | 223 |
| Net Interest Income after Provision for Loan Loss | 710 | 198 | 1,270 | 337 |
| Non-Interest Income | -- | |||
| Fees and service charges on deposit accounts | 74 | 26 | 152 | 49 |
| Loan fee income | 7 | 3 | 11 | 5 |
| All other income | 15 | 5 | 24 | 13 |
| Total Non-Interest Income | 96 | 34 | 187 | 67 |
| Non-Interest Expense | -- | |||
| Salaries and employee benefits | 466 | 336 | 913 | 665 |
| Occupancy and equipment | 138 | 110 | 285 | 221 |
| Data processing services | 32 | 19 | 58 | 42 |
| Professional and other fees | 35 | 42 | 74 | 69 |
| Advertising and promotion | 7 | 4 | 8 | 9 |
| Federal insurance assessment | 41 | 39 | 71 | 51 |
| Other operating expenses | 76 | 60 | 149 | 105 |
| Total Non-Interest Expenses | 795 | 610 | 1,558 | 1,162 |
| Net Income (Loss) | $11 | $ (378) | $ (101) | $ (758) |
| Income (Loss) per share: | ||||
| Basic | $0.01 | $ (0.23) | $ (0.06) | $ (0.46) |
| Diluted | 0.01 | (0.23) | (0.06) | (0.46) |