New Jersey Community Bank Reports First Quarter 2015 Results

FREEHOLD, NJ--(Marketwired - Apr 29, 2015) - New Jersey Community Bank (OTCQB: NJCB) (the "Bank") reported net loss of $46 thousand, or ($0.02) for the three months ended March 31, 2015, compared with a net loss of $8 thousand for the same period in the prior year.

The earnings for the quarter were negatively impacted largely due to a decline in interest income on loans as a result of a decrease in total loans coupled with a decline in fee income on deposit accounts. The decline in interest income was largely offset by decreases in interest expense on deposits, provision for loan loss, and non-interest expenses. Net interest margin improved 10 basis points year over year primarily due to a moderate increase in yields on earning assets.

Balance Sheet Summary

At March 31, 2015, total assets were $129.3 million, an increase of $7.3 million from December 31, 2014 primarily as a result of increase in total deposits. Total cash and cash equivalents increased $5.8 million while due from banks time deposits and investment securities increased $2.7 million and $1.9 million, respectively, compared to year end 2014. Total loans decreased $3.1 million compared to year end 2014 resulting from loan pay-offs.

Total deposits increased $7.2 million compared to the levels at year end 2014. Savings, NOW and money market accounts increased $5.3 million and non-interest bearing deposits increased $2.2 million, slightly offset by a $300 thousand decrease in total time deposits.

Shareholders' equity totaled $14.5 million at March 31, 2015, increasing moderately from year-end 2014. The Bank's capital ratios continue to remain strong, with a leverage ratio of 10.48%, a tier 1 risk based capital ratio of 13.26% and a total risk based capital ratio of 14.51%. These ratios exceed those needed to be deemed a well-capitalized financial institution.

Results of Operations

For the quarter ended March 31, 2015, net interest income totaled $1.0 million, decreasing $108 thousand over the same period in the prior year. At March 31, 2015, net interest margin was 3.50%, increasing 10 basis points compared to the same period a year ago. Yield on average earning assets increased 6 basis points to 4.22% while the cost of interest-bearing deposits declined 5 basis points to 0.85%, compared to the same period in the prior year primarily due to low interest rates.

The provision for loan loss was $15 thousand for the first quarter 2015, a decrease of $45 thousand compared to a year-ago quarter. The allowance for loan loss at period-end was $1.6 million, or 1.91% of total loans. The asset quality continued to be monitored and management will take action as necessary to effect the provision for loan loss, however, the current level of the allowance for loan loss is considered to be adequate.

Non-interest income decreased $51 thousand to $80 thousand for the quarter ended March 31, 2015, compared with $131 thousand for the same quarter in the prior year. Majority of such decrease is directly related to decreases in fees and service charges on deposit accounts and loan fee income.

Non-interest expense totaled $1.1 million for the quarter ended March 31, 2015, a decrease of $41 thousand, from a year-ago quarter. Of the total decrease in non-interest expense, salaries and employee benefits decreased $73 thousand as a result of vacancies in staffing partially offset by increase of $34 thousand in other operating expenses primarily due to expenses recorded in connection with other real estate owned. All other components of total non-interest expenses showed moderate variances.

About the Bank
New Jersey Community Bank is a state-chartered commercial bank headquartered in Freehold, New Jersey. The Bank opened for business in July 2008 and operates three full-service banking offices in the central New Jersey counties of Monmouth and Middlesex. 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.

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)
				As of or for the Quarters Ended
(in thousands, except per share and percentage data)				3/31/2015				12/31/2014				9/30/2014				6/30/2014				3/31/2014
Summary of Operations:
	Interest income			$	1,219			$	1,218			$	1,339			$	1,372			$	1,367
	Interest expense				211				207				230				244				251
		Net interest income			1,008				1,011				1,109				1,128				1,116
	Provision for loan and lease loss				15				263				30				275				60
		Net interest income after provision for loan loss			993				748				1,079				853				1,056
	Non-interest income				80				78				92				119				132
	Non-interest expense				1,149				1,052				1,141				876				1,190
		Income before income tax expense			(76	)			(226	)			30				96				(3	)
	Income tax expense				(30	)			(103	)			18				45				5
		Net income		$	(46	)		$	(123	)		$	12			$	51			$	(8	)
Per Common Share:
		Basic		$	(0.02	)		$	(0.06	)		$	0.01			$	0.03			$	(0.00	)
		Diluted			(0.02	)			(0.06	)			0.01				0.03				(0.00	)
	Book value per share				7.62				7.60				7.63				7.61				7.51
	Average shares outstanding				1,908				1,908				1,908				1,908				1,908
	Average diluted shares outstanding				1,908				1,908				1,908				1,908				1,908
Selected Financial Ratios:
	Return on average assets				-0.15	%			-0.39	%			0.04	%			0.15	%			-0.02	%
	Return on average common equity				-1.26	%			-3.35	%			0.33	%			1.42	%			-0.22	%
	Average equity to average assets				11.53	%			11.72	%			11.03	%			10.34	%			10.15	%
	Risk-based capital:
		Total risk-based capital ratio			14.51	%			14.45	%			14.41	%			13.41	%			13.56	%
		Tier 1 risk-based capital ratio			13.26	%			13.19	%			13.16	%			12.16	%			12.31	%
		Tier 1 leverage capital ratio			10.48	%			10.54	%			10.15	%			9.61	%			9.74	%
Financial Condition:
	Total assets			$	129,317			$	122,018			$	128,171			$	138,555			$	139,670
	Loans, net of unearned income				83,058				86,111				86,472				94,166				95,720
	Deposits				114,293				107,088				113,192				123,698				123,123
	Shareholder's equity				14,543				14,495				14,554				14,511				14,330

New Jersey Community Bank
Statements of Financial Condition
(dollars in thousands, except share data)
						March 31,				December 31,
						2015				2014
Assets						(unaudited)
		Cash and due from banks - non-interest bearing				$	2,136			$	1,107
		Federal funds sold and interest-bearing deposits with banks					9,472				4,728
				Total Cash and Cash Equivalents			11,608				5,835
		Due from banks - time deposits					8,312				5,577
		Investment Securities:
			Available-for-sale				13,725				13,680
			Held-to-maturity				4,888				3,043
				Total Investment Securities			18,613				16,723
		Loans Receivable, net of unearned fees					83,058				86,111
			Less: Allowance for loan losses				(1,591	)			(1,576	)
				Net Loans			81,467				84,535
		Premises and equipment, net					2,299				2,361
		Accrued interest receivable					276				277
		Bank-owned life insurance					3,702				3,678
		Deferred tax assets					1,539				1,589
		Other assets					1,501				1,443
				Total Assets		$	129,317			$	122,018
Liabilities and Shareholders' Equity
	Liabilities
		Deposits:
			Non-interest bearing			$	12,907			$	10,670
			Savings, NOW and money market				50,347				45,028
			Time deposits $100M and over				38,830				38,750
			Time deposits, other				12,209				12,640
				Total Deposits			114,293				107,088
		Accrued interest payable					12				10
		Other liabilities					469				425
				Total Liabilities			114,774				107,523
	Shareholders' Equity
		Common stock, $2 par value; authorized 10,000,000 shares; issued and outstanding 1,908,445 shares, respectively					3,817				3,817
		Surplus					13,856				13,854
		Accumulated Deficit					(3,147	)			(3,101	)
		Accumulated other comprehensive loss					17				(75	)
				Total Shareholders' Equity			14,543				14,495
				Total Liabilities and Shareholders' Equity		$	129,317			$	122,018

New Jersey Community Bank Statements of Operations (dollars in thousands, except per share data)(unaudited)
					Three Months Ended
					March 31,
					2015				2014
Interest Income
	Loans receivable, including fees				$	1,114			$	1,254
	Investment securities					88				96
	Federal funds sold and interest-bearing deposits with banks					4				7
	Due from banks - interest bearing					13				10
			Total Interest Income			1,219				1,367
Interest Expense
Deposits						211				251
			Net Interest Income before Provision for Loan Loss			1,008				1,116
Provision for Loan Loss						15				60
			Net Interest Income after Provision for Loan Loss			993				1,056
Non-Interest Income
	Fees and service charges on deposit accounts					40				74
	Loan fee income					6				20
	Income from bank owned life insurance					24				24
	All other income					10				13
			Total Non-Interest Income			80				131
Non-Interest Expense
	Salaries and employee benefits					579				652
	Occupancy and equipment					206				212
	Data processing services					54				47
	Professional and other fees					111				117
	Advertising and promotion					2				5
	Federal insurance assessment					66				60
	Other operating expenses					131				97
			Total Non-Interest Expenses			1,149				1,190
			Loss Before Income Tax Benefit			(76	)			(3	)
	Income tax benefit					(30	)			5
Net Loss					$	(46	)		$	(8	)
Loss per share:
	Basic and diluted				$	(0.02	)		$	(0.00	)
Weighted average number of common shares outstanding
	Basic and diluted					1,908				1,908

New Jersey Community Bank
Analysis of Average Balance Sheet and Net Interest Income
(unaudited)
					For the Three Months Ended
					March 31, 2015										March 31, 2014
					Average				Average			Average			Average
					Balance				Interest			Rate			Balance				Interest			Rate
Interest Earning Assets:
	Loans				$	85,146			$	1,114		5.31	%		$	95,630			$	1,254		5.32	%
	Investment securities					17,255				88		2.04	%			17,795				96		2.16	%
	Federal funds sold and interest-bearing deposits with banks					7,487				4		0.21	%			12,804				7		0.22	%
	Due from banks - time deposits					7,042				13		0.75	%			6,879				10		0.59	%
			Total interest-earning assets			116,930				1,219		4.22	%			133,108				1,367		4.16	%
Allowance for loan loss						(1,583	)									(1,848	)
Cash and due from banks - non-interest bearing						1,505										1,450
All other assets						9,333										8,126
			Total assets		$	126,185									$	140,836
Interest Bearing Liabilities:
	Deposits:
		Savings, NOW and money market			$	48,587				62		0.52	%		$	43,235				49		0.46	%
		Time deposits $100M and over				39,192				117		1.21	%			52,299				148		1.15	%
		Time deposits, other				12,358				32		1.05	%			17,410				54		1.26	%
			Total interest-bearing deposits			100,137				211		0.85	%			112,944				251		0.90	%
Demand						10,999										12,262
Other liabilities						502										1,337
			Total liabilities			111,638										126,543
	Stockholders' equity					14,547										14,293
			Total liabilities & stockholders' equity		$	126,185									$	140,836
Net interest income									$	1,008									$	1,116
Average interest rate spread												3.37	%									3.26	%
Net interest margin												3.50	%									3.40	%