BARDONIA, N.Y., April 25, 2018 (GLOBE NEWSWIRE) -- Greater Hudson Bank (the “Bank”) (OTCQX:GHDS), with assets of $501.3 million, today reported net income of $205,000 or $0.02 per common share for the first quarter of 2018 compared to $664,000 or $0.05 per common share for the 2017 first quarter. Return on average common stockholders’ equity was 1.43 percent for the three months ended March 31, 2018 compared to 5.82 percent for the three months ended March 31, 2017, respectively.
Edward T. Lutz, President and CEO stated, “Earnings in the first quarter of 2018 were adversely affected by a number of one-time charges including a decision to write off a long standing problem asset related to the Bank’s REO property, an adjustment to the Bank’s carrying value of the REO property, one time personnel costs associated with staff reorganization and certain non-recurring legal fees. Absent those costs, net income would have exceeded our internal forecast for the quarter. It is important to note that assets, deposits and loans have resumed a growth trajectory that is in line with our forecasts, as we indicated in the year end 2017 release. It is also important to note that our spread and margins, the life blood of our institution, have widened compared to last year’s results. Positively, non-performing assets declined by about 6 percent in the first quarter and we are actively working to effect additional reductions in the coming quarters. Our balance sheet remains strongly capitalized. We look forward to continued expansion in the loan portfolio as our pipeline continues to be robust and we see growth in core deposits, as our team based approach to our core markets continues to be effective.”
Financial highlights as of March 31, 2018 compared to December 31, 2017 are as follows:
- Deposits increased $20.0 million, or 5.2 percent, to $401.7 million.
- Total assets increased $18.5 million, or 3.8 percent, to $501.3 million.
- Loans, net of unearned income, increased $18.1 million or 5.6 percent, to $340.7 million.
- Investments increased $10.3 million, or 8.5 percent, to $131.3 million.
Performance highlights for the three months ended March 31, 2018 compared to the March 31, 2017 period are as follows:
- Net interest income decreased $41,000, or 1.0 percent, to $4.2 million.
- Non-interest income increased $36,000 or 12.7 percent to $319,000.
- Non-interest expense increased $583,000 or 19.0 percent to $3.7 million.
- The provision for loan losses increased $132,000.
Kenneth J. Torsoe, Chairman of the Board commented, “Our quarterly results are effected by a number of one-time charges, and don’t fully reflect the trend of our performance. The underlying components of the Bank’s performance continue to improve and should show positive results in the future. Management’s plans are being executed in an effective and efficient fashion with a keen eye on developing sound and long lasting customer relationships. We continue to be a soundly operated community bank dedicated to fulfilling our mission to serve the banking needs of commercial clients, non-profits, and municipalities in our core communities.”
EARNINGS
| *Results Unaudited | Three months Ended | |||||||
| March 31, (in thousands, except ratios) | ||||||||
| SUMMARY OF OPERATIONS DATA: | 2018 | 2017 | ||||||
| Net interest income | $ | 4,165 | $ | 4,206 | ||||
| Provision for loan losses | 592 | 461 | ||||||
| Noninterest income | 319 | 283 | ||||||
| Noninterest Expense | 3,652 | 3,069 | ||||||
| Income before income taxes | 240 | 959 | ||||||
| Provision for income taxes | 35 | 295 | ||||||
| Net income | $ | 205 | $ | 664 | ||||
| Efficiency Ratio | 81.4% | 68.4% | ||||||
| AVERAGE BALANCE SHEET DATA: | 2017 | 2016 | ||||||
| Earning Assets | $ | 464,109 | $ | 485,458 | ||||
| Total Interest Bearing Liabilities | 359,698 | 380,061 | ||||||
| Net interest spread | 3.52% | 3.40% | ||||||
| Net interest margin | 3.59% | 3.47% | ||||||
The decrease in net income for the three months ended March 31, 2018 compared to the three months ended March 31, 2017, is primarily attributable to an increase in non-interest expense of $583,000 and an increase of $132,000 to the provision for losses. The increase in non-interest expense is primarily related to one-time charges to salary and commission expenses and legal expenses incurred in the first quarter as part of a management review and reorganization, as well as a write-down of the Bank’s OREO property and an increase to the provision for loan losses as of March 31, 2018.
BALANCE SHEET & CREDIT QUALITY
| SELECTED BALANCE SHEET DATA – Unaudited: | As of | ||||||||
| (in thousands, except ratios) | March 31, | December 31, | March 31, | ||||||
| 2018 | 2017 | 2017 | |||||||
| Total Investments | $ | 131,250 | $ | 120,990 | $ | 144,145 | |||
| Loans, net of unearned income | 340,702 | 322,633 | 328,024 | ||||||
| Allowance for loan losses | 4,128 | 3,873 | 5,020 | ||||||
| Total assets | 501,339 | 482,867 | 502,439 | ||||||
| Total deposits | 401,731 | 381,764 | 401,843 | ||||||
| Borrowings | 39,187 | 39,276 | 41,537 | ||||||
| Nonperforming assets | 7,746 | 8,261 | 13,569 | ||||||
| Allowance for loan losses to total net loans | 1.21% | 1.20% | 1.53% | ||||||
| Nonperforming assets to total assets | 1.55% | 1.71% | 2.70% | ||||||
The Bank’s total loans, net of unearned income increased by $18.1 million to $340.7 million as of March 31, 2018 compared to December 31, 2017. Additionally, the Bank increased investments by $10.3 million in the first quarter. The increase in earning assets was funded by the increase in total deposits of $20.0 million and a decrease to cash and due from of $9.1 million as of March 31, 2018 compared to December 31, 2017.
Nonperforming assets decreased $515,000 to $7.7 million as of March 31, 2018 from $8.3 million as of December 31, 2017. The nonperforming assets are comprised of a limited number of relationships that the Bank’s management is aggressively attempting to resolve and are closely monitored.
CAPITAL
| EQUITY – Unaudited | As of | |||||
| (in thousands, except ratios) | March 31, | |||||
| 2018 | 2017 | |||||
| Tier 1 Capital | $ | 58,470 | $ | 55,613 | ||
| Total Stockholders' Equity | 56,761 | 55,815 | ||||
| Book value per common share | 4.58 | 4.53 | ||||
| Tier 1 Leverage Ratio | 11.7% | 11.0% | ||||
The Bank's leverage ratio was 11.7 percent at March 31, 2018 compared to 11.0 percent at March 31, 2017. The Bank continues to be considered a well-capitalized institution under current Federal regulatory guidelines.
Greater Hudson Bank’s annual Stockholders’ Meeting will be held Thursday, April 26, 2018 at 10:00 a.m. at the Crestview Conference Center, 440 West Nyack Road, West Nyack, NY 10994. All shareholders and interested parties are invited to attend.
Greater Hudson Bank, founded in 2002, is a premier NY community bank which specializes in providing customized banking services, SBA loans, commercial mortgages, and business lines of credit to Hudson Valley-based businesses, non-profits, and municipal agencies. The Bank is chartered by the New York State Department of Financial Services and its deposits are insured by the FDIC. As evidence of the Bank’s financial strength, Greater Hudson Bank has been recognized with a superior rating by the country's leading independent bank rating and research firm, BauerFinancial, Inc. Further information can be found on the Bank's website at GreaterHudsonBank.com or by calling 844-GREAT-11.
| Forward-Looking Statements: This Press Release may contain certain statements which are not historical facts or which concern the Bank's future operations or economic performance and which are to be considered forward-looking statements. Any such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Bank cautions that all forward-looking statements involve risk and uncertainties, and that actual results may differ from those indicated in the forward-looking statements as a result of various factors, such as changing economic and competitive conditions and other risk and uncertainties. In addition, any statements in this news release regarding historical stock price performance are not indicative of or guarantees of future price performance. |
Contact:
Jenet Ferris
(845) 367-4998