MIDLAND PARK, NJ--(Marketwired - May 07, 2015) - Stewardship Financial Corporation (
Paul Van Ostenbridge, Stewardship Financial Corporation's President and Chief Executive Officer, commented, "We are very pleased to report significant year-over-year improvement in the Corporation's earnings. In addition, we are pleased to show strong loan growth of $12.8 million for the three months ended March 31, 2015, which equates to an 11% annual rate of growth. The Corporation continues to demonstrate the ability to produce increasing results."
Operating Results
Net interest income was $5.4 million for the first quarter of 2015 compared to $5.3 million a year earlier. Interest income from loans increased $286,000 when compared to the three months ended March 31, 2014 due to the $53.1 million of growth in the average loan portfolio. The Corporation reported a net interest margin of 3.41% for the three months ended March 31, 2015, showing slight contraction when compared to 3.44% for the comparable period in 2014. "Like all financial institutions, the Corporation's net interest margin is reflective of lower yields on assets due to the low interest rate environment in which we continue to operate," said Van Ostenbridge.
The Corporation reported noninterest income of $918,000 for the three months ended March 31, 2015 compared to $399,000 for the equivalent prior year period. The current year reflects a $58,000 increase in fees and service charges as well as gains of $152,000 from the sale of available for sale securities and $53,000 from the sale of other real estate owned. The prior year period included a loss of $241,000 from the sale of nonperforming loans.
Total noninterest expenses were $5.0 million for the three months ended March 31, 2015 -- comparable to $5.1 million incurred in the prior year period. The Corporation remains committed to controlling expenses even with significant costs associated with regulatory compliance and expense incurred that supports the offering of today's required electronic services to customers.
Asset Quality
Results for the three months ended March 31, 2015 were positively impacted by the Corporation recording a negative provision for loan losses of $100,000 as compared to no provision for loan losses for the three months ended March 31, 2014. For the three months ended March 31, 2015, the Corporation recorded a $98,000 net recovery of previously charged off loan balances. In addition, nonperforming loans continue to decline and were $2.8 million, or 0.57% of total loans at March 31, 2015 compared to $3.6 million, or 0.76%, at December 31, 2014 and $5.1 million, or 1.20%, a year earlier. Total nonperforming assets of $3.1 million, which includes other real estate owned, also showed continued improvement and represented just 0.45% of total assets at March 31, 2015 compared to 0.71% and 1.02% at December 31, 2014 and March 31, 2014, respectively.
Balance Sheet / Financial Condition
Total assets at March 31, 2015 were $685.8 million, which reflected a slight decrease from assets of $693.6 million at December 31, 2014. A $12.8 million increase in gross loans during the first three months of 2015 was the result of new loan originations, partially offset by normal principal amortization. Van Ostenbridge noted, "We continue to make progress on our strategy to shift the balance sheet from investment securities into higher-yielding loans." During the three months ended March 31, 2015, the Corporation identified and sold approximately $27.8 million of available for sale securities with higher price volatility thus providing a portion of the funding for the loan growth while still continuing to manage overall asset growth.
Total deposits were $566.3 million at March 31, 2015, reflecting $9.8 million of growth when compared to deposits of $556.5 million at December 31, 2014. At March 31, 2015 noninterest bearing deposits now represent one-fourth of total deposits -- a very strong percentage which benefits the Corporation as these core deposits represent a consistent and lower cost source of funding.
Other borrowings decreased $16.7 million to $50.0 million at March 31, 2015. The decrease in other borrowings was partially the result of above discussed increase in deposits. In general, other borrowings enable the Corporation to deal with temporary deposit outflows and can assist in managing against rising interest rates through the extension of liabilities.
At March 31, 2015, the Corporation's leverage, common equity tier 1 and total risk based capital ratios were 9.83%, 8.93% and 14.46% percent, respectively. These ratios, calculated under the new Basel III guidelines, are all above the respective 6.5%, 5% and 10% levels required to be considered a "well capitalized" institution under regulatory guidelines.
About Stewardship Financial Corporation
Stewardship Financial Corporation's subsidiary, the Atlantic Stewardship Bank, has 12 banking offices in Midland Park, Hawthorne (2), Montville, North Haledon, Pequannock, Ridgewood, Waldwick, Wayne (2),Westwood and Wyckoff, New Jersey. The bank is known for tithing 10% of its pre-tax profits to Christian and local charities. To date, the Bank's tithe donations total $8.1 million.
We invite you to visit our website at www.asbnow.com for additional information.
The information disclosed in this document contains certain "forward looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, and may be identified by the use of such words as "believe," "expect," "anticipate," "should," "plan," "estimate," and "potential." Examples of forward looking statements include, but are not limited to, estimates with respect to the financial condition, results of operations and business of the Corporation that are subject to various factors which could cause actual results to differ materially from these estimates. These factors include: changes in general, economic and market conditions, legislative and regulatory conditions, or the development of an interest rate environment that adversely affects the Corporation's interest rate spread or other income anticipated from operations and investments.
| Stewardship Financial Corporation | ||||||||||||||||||||||
| Selected Consolidated Financial Information | ||||||||||||||||||||||
| (dollars in thousands, except per share amounts) | ||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||||
| 2015 | 2014 | 2014 | 2014 | 2014 | ||||||||||||||||||
| Selected Financial Condition Data: | ||||||||||||||||||||||
| Cash and cash equivalents | $ | 21,035 | $ | 10,086 | $ | 10,850 | $ | 14,630 | $ | 27,176 | ||||||||||||
| Securities available for sale | 94,553 | 124,918 | 138,255 | 144,459 | 171,692 | |||||||||||||||||
| Securities held to maturity | 55,811 | 55,097 | 54,234 | 54,225 | 24,685 | |||||||||||||||||
| FHLB Stock | 3,026 | 3,777 | 2,882 | 2,429 | 2,133 | |||||||||||||||||
| Loans receivable: | ||||||||||||||||||||||
| Loans receivable, gross | 490,087 | 477,320 | 443,006 | 433,198 | 423,471 | |||||||||||||||||
| Allowance for loan losses | (9,600 | ) | (9,602 | ) | (10,094 | ) | (9,825 | ) | (9,792 | ) | ||||||||||||
| Other, net | (7 | ) | (19 | ) | (17 | ) | 40 | 105 | ||||||||||||||
| Loans receivable, net | 480,480 | 467,699 | 432,895 | 423,413 | 413,784 | |||||||||||||||||
| Loans held for sale | 798 | - | 364 | 259 | 186 | |||||||||||||||||
| Other assets | 30,114 | 31,974 | 33,072 | 32,107 | 32,947 | |||||||||||||||||
| Total assets | $ | 685,817 | $ | 693,551 | $ | 672,552 | $ | 671,522 | $ | 672,603 | ||||||||||||
| Noninterest-bearing deposits | $ | 141,406 | $ | 136,721 | $ | 140,345 | $ | 143,711 | $ | 137,687 | ||||||||||||
| Interest-bearing deposits | 424,916 | 419,755 | 416,666 | 422,669 | 437,729 | |||||||||||||||||
| Total deposits | 566,322 | 556,476 | 557,011 | 566,380 | 575,416 | |||||||||||||||||
| Other borrowings | 50,000 | 66,700 | 46,800 | 31,000 | 25,000 | |||||||||||||||||
| Securities sold under agreements to repurchase | - | - | 100 | 7,601 | 7,601 | |||||||||||||||||
| Subordinated debentures | 7,217 | 7,217 | 7,217 | 7,217 | 7,217 | |||||||||||||||||
| Other liabilities | 2,166 | 4,189 | 4,166 | 2,329 | 2,209 | |||||||||||||||||
| Total liabilities | 625,705 | 634,582 | 615,294 | 614,527 | 617,443 | |||||||||||||||||
| Shareholders' equity | 60,112 | 58,969 | 57,258 | 56,995 | 55,160 | |||||||||||||||||
| Total liabilities and shareholders' equity | $ | 685,817 | $ | 693,551 | $ | 672,552 | $ | 671,522 | $ | 672,603 | ||||||||||||
| Book value per common share | $ | 6.98 | $ | 6.98 | $ | 6.98 | $ | 6.98 | $ | 6.98 | ||||||||||||
| Gross loans to deposits | 86.54 | % | 85.78 | % | 79.53 | % | 76.49 | % | 73.59 | % | ||||||||||||
| Equity to assets | 8.77 | % | 8.50 | % | 8.51 | % | 8.49 | % | 8.20 | % | ||||||||||||
| Asset Quality Data: | ||||||||||||||||||||||
| Nonaccrual loans | $ | 2,798 | $ | 3,628 | $ | 4,434 | $ | 4,875 | $ | 5,073 | ||||||||||||
| Loans past due 90 days or more and accruing | - | - | - | - | - | |||||||||||||||||
| Total nonperforming loans | 2,798 | 3,628 | 4,434 | 4,875 | 5,073 | |||||||||||||||||
| Other real estate owned | 320 | 1,308 | 2,090 | 1,225 | 1,789 | |||||||||||||||||
| Total nonperforming assets | $ | 3,118 | $ | 4,936 | $ | 6,524 | $ | 6,100 | $ | 6,862 | ||||||||||||
| Nonperforming loans to total loans | 0.57 | % | 0.76 | % | 1.00 | % | 1.13 | % | 1.20 | % | ||||||||||||
| Nonperforming assets to total assets | 0.45 | % | 0.71 | % | 0.97 | % | 0.91 | % | 1.02 | % | ||||||||||||
| Allowance for loan losses to nonperforming loans | 343.10 | % | 264.66 | % | 227.65 | % | 201.54 | % | 193.02 | % | ||||||||||||
| Allowance for loan losses to total gross loans | 1.96 | % | 2.01 | % | 2.28 | % | 2.27 | % | 2.31 | % | ||||||||||||
| Stewardship Financial Corporation | ||||||||||
| Selected Consolidated Financial Information | ||||||||||
| (dollars in thousands, except per share amounts) | ||||||||||
| (unaudited) | ||||||||||
| For the three months ended | ||||||||||
| March 31, | ||||||||||
| 2015 | 2014 | |||||||||
| Selected Operating Data: | ||||||||||
| Interest income | $ | 6,194 | $ | 6,145 | ||||||
| Interest expense | 793 | 839 | ||||||||
| Net interest and dividend income | 5,401 | 5,306 | ||||||||
| Provision for loan losses | (100 | ) | - | |||||||
| Net interest and dividend income after provision for loan losses | 5,501 | 5,306 | ||||||||
| Noninterest income: | ||||||||||
| Fees and service charges | 479 | 421 | ||||||||
| Bank owned life insurance | 96 | 96 | ||||||||
| Gain on calls and sales of securities | 152 | - | ||||||||
| Gain on sales of mortgage loans | 10 | 12 | ||||||||
| Loss on sales of loans | - | (241 | ) | |||||||
| Gain on sales of other real estate owned | 53 | - | ||||||||
| Other | 128 | 111 | ||||||||
| Total noninterest income | 918 | 399 | ||||||||
| Noninterest expenses: | ||||||||||
| Salaries and employee benefits | 2,708 | 2,678 | ||||||||
| Occupancy, net | 467 | 555 | ||||||||
| Equipment | 156 | 188 | ||||||||
| Data processing | 453 | 387 | ||||||||
| FDIC insurance premium | 113 | 211 | ||||||||
| Other | 1,152 | 1,075 | ||||||||
| Total noninterest expenses | 5,049 | 5,094 | ||||||||
| Income before income tax expense | 1,370 | 611 | ||||||||
| Income tax expense | 453 | 105 | ||||||||
| Net income | 917 | 506 | ||||||||
| Dividends on preferred stock | 171 | 171 | ||||||||
| Net income available to common shareholders | $ | 746 | $ | 335 | ||||||
| Weighted avg. no. of diluted common shares | 6,045,683 | 5,956,887 | ||||||||
| Diluted earnings per common share | $ | 0.12 | $ | 0.06 | ||||||
| Return on average common equity | 6.77 | % | 3.41 | % | ||||||
| Return on average assets | 0.54 | % | 0.31 | % | ||||||
| Yield on average interest-earning assets | 3.90 | % | 3.97 | % | ||||||
| Cost of average interest-bearing liabilities | 0.67 | % | 0.71 | % | ||||||
| Net interest rate spread | 3.23 | % | 3.26 | % | ||||||
| Net interest margin | 3.41 | % | 3.44 | % | ||||||
| Stewardship Financial Corporation | ||||||||||||||||||||||
| Selected Consolidated Financial Information | ||||||||||||||||||||||
| (dollars in thousands, except per share amounts) | ||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||
| For the three months ended | ||||||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||||
| 2015 | 2014 | 2014 | 2014 | 2014 | ||||||||||||||||||
| Selected Operating Data: | ||||||||||||||||||||||
| Interest income | $ | 6,194 | $ | 6,534 | $ | 6,069 | $ | 6,186 | $ | 6,145 | ||||||||||||
| Interest expense | 793 | 767 | 791 | 810 | 839 | |||||||||||||||||
| Net interest and dividend income | 5,401 | 5,767 | 5,278 | 5,376 | 5,306 | |||||||||||||||||
| Provision for loan losses | (100 | ) | (300 | ) | 250 | - | - | |||||||||||||||
| Net interest and dividend income | ||||||||||||||||||||||
| after provision for loan losses | 5,501 | 6,067 | 5,028 | 5,376 | 5,306 | |||||||||||||||||
| Noninterest income: | ||||||||||||||||||||||
| Fees and service charges | 479 | 568 | 510 | 504 | 421 | |||||||||||||||||
| Bank owned life insurance | 96 | 103 | 100 | 106 | 96 | |||||||||||||||||
| Gain on calls and sales of securities | 152 | 165 | - | - | - | |||||||||||||||||
| Gain on sales of mortgage loans | 10 | 26 | 32 | 2 | 12 | |||||||||||||||||
| Loss on sales of loans | - | - | - | - | (241 | ) | ||||||||||||||||
| Gain on sales of other real estate owned | 53 | 9 | - | 54 | - | |||||||||||||||||
| Other | 128 | 119 | 122 | 141 | 111 | |||||||||||||||||
| Total noninterest income | 918 | 990 | 764 | 807 | 399 | |||||||||||||||||
| Noninterest expenses: | ||||||||||||||||||||||
| Salaries and employee benefits | 2,708 | 2,738 | 2,624 | 2,557 | 2,678 | |||||||||||||||||
| Occupancy, net | 467 | 420 | 439 | 520 | 555 | |||||||||||||||||
| Equipment | 156 | 157 | 167 | 175 | 188 | |||||||||||||||||
| Data processing | 453 | 447 | 433 | 435 | 387 | |||||||||||||||||
| FDIC insurance premium | 113 | 103 | 133 | 133 | 211 | |||||||||||||||||
| Other | 1,152 | 1,179 | 1,193 | 1,286 | 1,075 | |||||||||||||||||
| Total noninterest expenses | 5,049 | 5,044 | 4,989 | 5,106 | 5,094 | |||||||||||||||||
| Income before income tax expense | 1,370 | 2,013 | 803 | 1,077 | 611 | |||||||||||||||||
| Income tax expense | 453 | 712 | 251 | 351 | 105 | |||||||||||||||||
| Net income | 917 | 1,301 | 552 | 726 | 506 | |||||||||||||||||
| Dividends on preferred stock | 171 | 171 | 170 | 171 | 171 | |||||||||||||||||
| Net income available to common shareholders | $ | 746 | $ | 1,130 | $ | 382 | $ | 555 | $ | 335 | ||||||||||||
| Weighted avg. no. of diluted common shares | 6,045,683 | 6,030,561 | 6,026,848 | 5,999,897 | 5,956,887 | |||||||||||||||||
| Diluted earnings per common share | $ | 0.12 | $ | 0.19 | $ | 0.06 | $ | 0.09 | $ | 0.06 | ||||||||||||
| Return on average common equity | 6.77 | % | 10.41 | % | 3.58 | % | 5.41 | % | 3.41 | % | ||||||||||||
| Return on average assets | 0.54 | % | 0.75 | % | 0.33 | % | 0.44 | % | 0.31 | % | ||||||||||||
| Yield on average interest-earning assets | 3.90 | % | 4.04 | % | 3.85 | % | 4.03 | % | 3.97 | % | ||||||||||||
| Cost of average interest-bearing liabilities | 0.67 | % | 0.64 | % | 0.68 | % | 0.70 | % | 0.71 | % | ||||||||||||
| Net interest rate spread | 3.23 | % | 3.40 | % | 3.17 | % | 3.33 | % | 3.26 | % | ||||||||||||
| Net interest margin | 3.41 | % | 3.57 | % | 3.36 | % | 3.51 | % | 3.44 | % | ||||||||||||
Contact Information:
Contact:
Claire M. Chadwick
EVP and Chief Financial Officer
630 Godwin Avenue
Midland Park, NJ 07432
201- 444-7100