SAN FRANCISCO, Oct. 25, 2016 (GLOBE NEWSWIRE) -- New Resource Bank (OTC Link LLC:NWBN) has announced unaudited financial results for the third quarter ended September 30, 2016.
The bank performed strongly in the third quarter. Gross loans totaled $236.9 million — a $50 million or 27 percent increase over September 30, 2015. Factors influencing the robust growth in loans are a favorable economic environment coupled with the attractiveness of our mission to socially and environmentally responsible organizations. Total deposits amounted to $277.3 million, an increase of $39 million or 16 percent over September 30, 2015. Asset quality remained strong, with non-performing assets to total assets declining from 0.63 percent to 0.13 percent.
Pre-tax net income rose to $720,000, a 169 percent increase from the third quarter of 2015, while net income for the quarter dropped to $274,000. The decline in net income from $7.1 million from the quarter ended September 30, 2015, reflects the impact of income taxes. In the third quarter of 2015 the bank recognized a deferred tax asset amounting to $6.9 million, which was primarily associated with an accumulated net operating loss carryforward. The rise in pre-tax net income reflects our sound asset quality together with the 21% growth in net interest income.
“The strength of our business model in serving values-aligned organizations is underscored by our solid asset quality and loan and deposit growth. Our positive financial results demonstrate our continuing success as a values-based bank focused on growing the new economy,” said Vincent Siciliano, New Resource Bank president and CEO.
Key financial results from the third quarter of 2016 compared with the same quarter of 2015 include:
- Loan growth: Loans outstanding grew 27 percent, to $236.9 million from $186.3 million one year ago.
- Asset quality: Non-performing assets to total assets decreased from 0.63 percent to 0.13 percent as a result of the charge-off of a single loan in the fourth quarter of 2015.
- Deposit growth: Deposits rose 16 percent to $277.3 million from $238.5 million one year ago.
- Total assets: Total assets increased 14 percent to $320.4 million from $280.2 million one year ago.
- Net interest income: Net interest income for the third quarter ended September 30, 2016 was $3.1 million, an increase of $541,000 or 21 percent from the third quarter of 2015.
- Non-interest income: Non-interest income for the third quarter was $288,000, an increase of $83,000 or 41 percent. A key factor influencing growth was revenue generated from the purchase of bank-owned life insurance earlier in 2016.
- Non-interest expense: Non-interest expense for the third quarter was $2.7 million, an increase of $187,000 or 8 percent. The increase was influenced by the expansion in staffing to support the bank’s growth; the bank currently has 47 employees.
- Provision expense: Provision expense reflected a reduction of $15,000 for the quarter, due to our sound asset quality.
- Efficiency ratio: The bank’s efficiency ratio for the third quarter was 79.3 percent, a decrease from 90.4 percent from the third quarter of 2015. Performance was positively impacted by revenue growth from loans outpacing the growth in expenses.
- Risk-based capital: The common equity tier 1 capital ratio amounted to 12.83 percent and the total risk-based capital ratio was 14.09 percent, significantly above the standard for a well-capitalized bank.
“I am pleased with our favorable performance this quarter. Our strong financial ratios help maintain the bank’s solid foundation for us to continue to grow our mission to help achieve well-being for people and the planet through banking,” stated Mark A. Finser, chairman of the New Resource Bank board.
| Quarter Ended | |||||||||||
| (in thousands) | |||||||||||
| Balance Sheet | September 30, 2016 | September 30, 2015 | % Change | ||||||||
| Assets | |||||||||||
| Cash & Due From | $ | 7,352 | $ | 6,426 | 14.4 | % | |||||
| Interest Bearing Deposits | 31,360 | 48,970 | -36.0 | % | |||||||
| Money Market Funds | - | - | 0.0 | % | |||||||
| Fed Funds | - | - | 0.0 | % | |||||||
| Investments | 31,396 | 30,075 | 4.4 | % | |||||||
| Gross Loans | 236,949 | 186,287 | 27.2 | % | |||||||
| Allowance for Loan Loss | (3,702 | ) | (3,361 | ) | 10.1 | % | |||||
| Premises & Equipment | 2,464 | 2,520 | -2.2 | % | |||||||
| Other Real Estate Owned | 87 | - | 0.0 | % | |||||||
| Other Assets | 14,460 | 9,245 | 56.4 | % | |||||||
| Total Assets | $ | 320,367 | $ | 280,162 | 14.4 | % | |||||
| Liabilities & Equity | |||||||||||
| Deposits | $ | 277,335 | $ | 238,495 | 16.3 | % | |||||
| Borrowings | - | - | 0.0 | % | |||||||
| Other Liabilities | 2,671 | 2,410 | 10.8 | % | |||||||
| Total Liabilities | 280,006 | 240,904 | 16.2 | % | |||||||
| Equity | 40,361 | 39,258 | 2.8 | % | |||||||
| Total Liabilities & Equity | $ | 320,367 | $ | 280,162 | 14.4 | % | |||||
| Book value per outstanding share | $ | 6.94 | $ | 6.74 | |||||||
| Leverage ratio | 11.37 | % | 12.88 | % | |||||||
| Total risk based capital ratio | 14.09 | % | 17.07 | % | |||||||
| BASEL III Common Equity Tier 1 | 12.83 | % | 15.81 | % | |||||||
| Loan loss reserves to total loans | 1.56 | % | 1.80 | % | |||||||
| Loan loss reserves to non-performing loans | 1,098 | % | 191 | % | |||||||
| Non-performing loans to total loans | 0.14 | % | 0.95 | % | |||||||
| Non-performing assets to total assets | 0.13 | % | 0.63 | % | |||||||
| Quarter Ended | |||||||||||
| (in thousands) | |||||||||||
| Income Statement | |||||||||||
| September 30, 2016 | September 30, 2015 | % Change | |||||||||
| Interest Income | $ | 3,141 | $ | 2,596 | 21.0 | % | |||||
| Interest Expense | 33 | 28 | 16.6 | % | |||||||
| Net Interest Income | 3,108 | 2,567 | 21.1 | % | |||||||
| Non-Interest Income | 288 | 205 | 40.8 | % | |||||||
| Provision for Loan Loss | (15 | ) | - | NM | |||||||
| Non-Interest Expense | 2,692 | 2,505 | 7.5 | % | |||||||
| Net Operating Income/(Loss) | 720 | 267 | 169.3 | % | |||||||
| Taxes | 446 | (6,848 | ) | NM | |||||||
| Net Income/(Loss) | $ | 274 | $ | 7,115 | -96.2 | % | |||||
| Net Interest Margin | 4.26 | % | 4.02 | % | 5.9 | % | |||||
| Efficiency Ratio | 79.25 | % | 90.36 | % | -12.3 | % | |||||
| NM = Not Meaningful | |||||||||||
| N/A = Not Available | |||||||||||
About New Resource Bank
New Resource Bank (https://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 preserve our planet.
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.