SOURCE: New Jersey Community Bank

New Jersey Community Bank

May 09, 2016 16:00 ET

New Jersey Community Bank Reports First Quarter 2016 Results

FREEHOLD, NJ--(Marketwired - May 9, 2016) - New Jersey Community Bank (OTCQB: NJCB) (the "Bank") reported a net loss of $283 thousand, or ($0.15) per share for the three months ended March 31, 2016, compared with a net loss of $46 thousand, or ($0.02) per share 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 partially offset by a decrease in interest expense on deposits. Net interest margin decreased 16 basis points year over year primarily due to a moderate decrease in the interest yield on loans.

Balance Sheet Summary

At March 31, 2016, total assets were $102.8 million, a decrease of $8.2 million from December 31, 2015 primarily as a result of decreases in total loans and investment securities. Total cash and cash equivalents increased $1.1 million while due from banks-time deposits decreased $0.7 million. Investment securities available-for-sale decreased $4.5 million as a result of calls on certain government agency securities. Total loans decreased $3.9 million compared to year end 2015 resulting from loan pay-offs.

Total deposits decreased $7.9 million compared to the levels at year end 2015. Savings, NOW and money market accounts decreased $6.1 million and non-interest bearing deposits decreased $2.4 million, slightly offset by $0.6 million increase in total time deposits.

Shareholders' equity totaled $11.5 million at March 31, 2016, decreasing moderately from year-end 2015. The Bank's capital ratios continue to remain strong, with a leverage ratio of 10.84%, common equity tier 1 risk based capital ratio of 14.65% and a total risk based capital ratio of 15.91%. These ratios exceed those needed to be deemed a well-capitalized financial institution.

Results of Operations

For the quarter ended March 31, 2016, net interest income totaled $0.8 million, decreasing $181 thousand over the same period in the prior year. At March 31, 2016, the net interest margin was 3.34%, decreasing 16 basis points compared to the same period a year ago. The yield on average earning assets decreased 20 basis points to 4.02% while the cost of interest-bearing deposits declined 2 basis points to 0.83%, compared to the same period in the prior year, primarily due to low interest rates.

The Bank did not record any provision for loan losses during the first quarter 2016. The allowance for loan losses at period-end was $1.6 million, or 2.28% of total loans. The asset quality continued to be monitored and management will take action as necessary to affect the provision for loan loss, however, the current level of the allowance for loan loss is considered to be adequate.

Non-interest income decreased $17 thousand to $63 thousand for the quarter ended March 31, 2016, compared with $80 thousand for the same quarter in the prior year. The majority of such decrease is directly related to decreases in fees and service charges on deposit accounts.

Non-interest expense totaled $1.2 million for the quarter ended March 31, 2016, increasing slightly from a year-ago quarter. Of the total increase in non-interest expense, salaries and employee benefits increased $27 thousand as a result of increases in health cost and annual salary increases. Professional and other fees increased $50 thousand largely due to consulting services utilized by the Bank to comply with the Consent Orders among the Bank and the regulators. These increases were offset by decreases in occupancy and equipment expense and other operating expenses. 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) 3/31/2016     12/31/2015     9/30/2015     6/30/2015     3/31/2015  
                                       
Summary of Operations:                                      
  Interest income $ 995     $ 1,060     $ 1,118     $ 1,238     $ 1,219  
  Interest expense   168       185       217       216       211  
        Net interest income   827       875       901       1,022       1,008  
  Provision for loan loss   -       -       695       -       15  
        Net interest income after provision for loan loss   827       875       206       1,022       993  
  Non-interest income   63       84       88       86       80  
  Non-interest expense   1,173       1,254       1,097       1,175       1,149  
        Loss before income tax expense (benefit)   (283 )     (295 )     (803 )     (67 )     (76 )
  Income tax expense (benefit)   -       1,919       (322 )     (26 )     (30 )
        Net loss $ (283 )   $ (2,214 )   $ (481 )   $ (41 )   $ (46 )
                                       
Per Common Share:                                      
      Basic $ (0.15 )   $ (1.16 )   $ (0.25 )   $ (0.02 )   $ (0.02 )
      Diluted   (0.15 )     (1.16 )     (0.25 )     (0.02 )     (0.02 )
  Book value per share   6.05       6.17       7.35       7.56       7.62  
    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   -1.07 %     -7.39 %     -1.50 %     -0.13 %     -0.15 %
    Return on average common equity   -9.66 %     -63.58 %     -13.35 %     -1.13 %     -1.26 %
    Average equity to average assets   11.05 %     11.62 %     11.21 %     11.21 %     11.53 %
    Risk-based capital:                                      
      Total risk-based capital ratio   15.91 %     15.21 %     15.20 %     14.62 %     14.51 %
      Common equity tier 1 risk-based capital ratio   14.65 %     13.95 %     -       -       -  
      Tier 1 risk-based capital ratio   14.65 %     13.95 %     13.92 %     13.26 %     13.26 %
      Tier 1 leverage capital ratio   10.84 %     9.84 %     9.83 %     10.20 %     10.48 %
                                       
Financial Condition:                                      
  Total assets $ 102,844     $ 111,078     $ 126,250     $ 132,065     $ 129,317  
  Loans, net of unearned income   68,759       72,674       77,092       81,914       83,058  
  Deposits   90,892       98,819       111,779       117,205       114,293  
  Shareholder's equity   11,535       11,770       14,021       14,420       14,543  
                                       
                                       
                                       
New Jersey Community Bank  
Statements of Financial Condition  
(dollars in thousands, except share data)  
   
    March 31,     December 31,  
    2016     2015  
Assets   (unaudited)        
    Cash and due from banks - non-interest bearing   $ 1,682     $ 1,615  
    Federal funds sold and interest-bearing deposits with banks     10,814       9,736  
          Total Cash and Cash Equivalents     12,496       11,351  
    Due from banks - time deposits     5,280       6,027  
    Investment Securities:                
      Available-for-sale     4,602       9,069  
      Held-to-maturity     6,277       6,537  
          Total Investment Securities     10,879       15,606  
    Loans Receivable, net of unearned fees     68,760       72,674  
        Less: Allowance for loan losses     (1,569 )     (1,569 )
          Net Loans     67,191       71,105  
    Premises and equipment, net     2,078       2,128  
    Accrued interest receivable     227       276  
    Bank-owned life insurance     3,798       3,774  
    Deferred tax assets     -       17  
    Other real estate owned     487       -  
    Other assets     407       794  
          Total Assets   $ 102,843     $ 111,078  
                 
Liabilities and Shareholders' Equity                
  Liabilities                
    Deposits:                
      Non-interest bearing   $ 12,715     $ 15,155  
      Savings, NOW and money market     32,744       38,808  
      Time deposits $250M and over     6,721       6,713  
      Time deposits, other     38,712       38,143  
          Total Deposits     90,892       98,819  
                     
    Accrued interest payable     9       9  
    Other liabilities     407       480  
          Total Liabilities     91,308       99,308  
                 
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     13,862       13,861  
    Accumulated Deficit     (6,165 )     (5,883 )
    Accumulated other comprehensive loss     21       (25 )
          Total Shareholders' Equity     11,535       11,770  
          Total Liabilities and Shareholders' Equity   $ 102,843     $ 111,078  
                 
                 
                 
New Jersey Community Bank  
Statements of Operations  
(dollars in thousands, except per share data)(unaudited)  
   
    Three Months Ended  
    March 31,  
    2016     2015  
Interest Income                
  Loans receivable, including fees   $ 894     $ 1,114  
  Investment securities     74       88  
  Federal funds sold and interest-bearing deposits with banks     13       4  
  Due from banks - interest bearing     14       13  
    Total Interest Income     995       1,219  
Interest Expense                
  Deposits     168       211  
    Net Interest Income before Provision for Loan Loss     827       1,008  
Provision for Loan Loss     -       15  
    Net Interest Income after Provision for Loan Loss     827       993  
Non-Interest Income                
  Fees and service charges on deposit accounts     22       40  
  Loan fee income     7       6  
  Income from bank owned life insurance     23       24  
  All other income     11       10  
                     
    Total Non-Interest Income     63       80  
                     
Non-Interest Expense                
  Salaries and employee benefits     606       579  
  Occupancy and equipment     188       206  
  Data processing services     60       54  
  Professional and other fees     161       111  
  Advertising and promotion     4       2  
  Federal insurance assessment     56       66  
  Other operating expenses     98       131  
    Total Non-Interest Expenses     1,173       1,149  
    Loss Before Income Taxes     (283 )     (76 )
  Income tax expense (benefit)     -       (30 )
Net Loss   $ (283 )   $ (46 )
Loss per share:                
  Basic and diluted   $ (0.15 )   $ (0.02 )
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, 2016     March 31, 2015  
  Average         Average     Average         Average  
  Balance     Interest   Rate     Balance     Interest   Rate  
Interest Earning Assets:                                      
  Loans $ 69,482     $ 894   5.18 %   $ 85,146     $ 1,114   5.31 %
  Investment securities   13,488       74   2.18 %     17,255       88   2.04 %
  Federal funds sold and interest-bearing deposits with banks   10,878       13   0.48 %     7,487       4   0.21 %
  Due from banks - time deposits   5,693       14   0.96 %     7,042       13   0.75 %
      Total interest-earning assets   99,542       995   4.02 %     116,930       1,219   4.22 %
Allowance for loan loss   (1,569 )                 (1,583 )            
Cash and due from banks - non-interest bearing   1,534                   1,505              
All other assets   6,544                   9,333              
      Total assets $ 106,050                 $ 126,185              
                                       
Interest Bearing Liabilities:                                      
  Deposits:                                      
    Savings, NOW and money market $ 35,989       28   0.31 %   $ 48,587       62   0.52 %
    Time deposits   45,206       140   1.25 %     51,550       149   1.16 %
      Total interest-bearing deposits   81,195       168   0.83 %     100,137       211   0.85 %
Demand   12,842                   10,999              
Other liabilities   293                   502              
      Total liabilities   94,330                   111,638              
                                       
Stockholders' equity   11,721                   14,547              
      Total liabilities & stockholders' equity $ 106,050                 $ 126,185              
Net interest income         $ 827                 $ 1,008      
                                       
Average interest rate spread               3.19 %                 3.37 %
                                       
Net interest margin               3.34 %                 3.50 %
                                       

Contact Information

  • Contacts at New Jersey Community Bank:

    William H. Placke
    Chairman, President and CEO
    bplacke@njcbk.com

    Naqi A. Naqvi
    Executive Vice President & CFO
    nnaqvi@njcbk.com