SOURCE: New Jersey Community Bank

New Jersey Community Bank

July 20, 2012 12:53 ET

New Jersey Community Bank Reports Second Quarter 2012 Results

FREEHOLD, NJ--(Marketwire - Jul 20, 2012) - New Jersey Community Bank (OTCBB: NJCB) (the "Bank") reported net income of $112 thousand, or $0.06 per common share for the three months ended June 30, 2012, compared to the second quarter 2011 earnings of $159 thousand, or $0.09 per common share. For the first six months of 2012, the Bank reported net income of $220 thousand, or $0.12 per common share compared with a net income of $300 thousand, or $0.16 per common share for the same period in the prior year.

Robert D. O'Donnell, Chairman, President and CEO commented that, "The outlook for the banking industry remains cloudy and complex, affecting both our customers and competitors, and the economic uncertainty will continue to pressure consumers. Our new loan demand has softened; however, we continue to explore ways to diversify our earnings sources. Though the lending opportunities are constrained by the uncertain economic environment, we will continue to focus on the financial needs in the communities we serve. Our earnings year over year reflect an increase in non-interest expense resulting directly from the addition of the new branch office, offset by a decrease in provision for loan loss in the same period."

All common share data presented in this press release including earnings per common share data was adjusted to reflect a five percent stock dividend issued on May 31, 2012.

Balance Sheet Summary

At June 30, 2012, total assets were $131.3 million, a moderate decrease compared to year end 2011. Total cash and cash equivalents and due from banks time deposits totaled $18.1 million, a decrease of $2.9 million from year end 2011. Total investment securities were almost unchanged from year end 2011 while loans receivable increased $2.5 million from December 31, 2011.

Deposits totaled $115.3 million at June 30, 2012, a decrease of $1.1 million from year end 2011. Of the total decrease in deposits, time deposits decreased $5.8 million, offset by an increase of $1.4 million in demand deposits and $3.3 million in savings, NOW and money market deposits. Shareholders' equity totaled $15.6 million at June 30, 2012. The Bank's capital ratios remain strong and exceed the regulatory requirements of a well capitalized financial institution.

Results of Operations

For the quarter ended June 30, 2012, net interest income totaled $1.1 million, a moderate decrease of $13 thousand over the same period in the prior year. The decrease in net interest income was primarily due to declining interest rates despite an increase in both average earning assets and interest-bearing deposits. Net interest margin declined 28 basis points to 3.60% for the quarter ended June 30, 2012, over the comparable quarter in 2011. Average yield on earning assets was 4.62%, dropping 48 basis points over the prior year and average rate on paying liabilities was 1.20%, dropping 22 basis points over the comparable quarter in the prior year.

The provision for loan loss was $25 thousand for the second quarter 2012, a decrease of $59 thousand compared to the year-ago quarter. The allowance for loan loss at period-end was $1.2 million, or 1.29% of total loans. Mr. O'Donnell noted, "We monitor the adequacy of the allowance for loan loss on an ongoing basis and consider the current level of the allowance for loan loss to be adequate."

Non-interest income decreased $22 thousand to $77 thousand for the quarter ended June 30, 2012 compared with $99 thousand for the same quarter in the prior year. The majority of the decrease is directly related to a decrease in fees and service charges on deposit accounts.

Non-interest expense totaled $994 thousand for the quarter ended June 30, 2012, an increase of $109 thousand from year-ago quarter, primarily due to the addition of a new branch office. Of the total increase, salaries and employee benefits increased $57 thousand, occupancy and equipment expense increased $32 thousand and all other expenses combined increased a net of $20 thousand.

Subsequent to quarter end, the Bank settled a lawsuit brought by a former employee. As a result of the settlement, the Bank will recognize $163 thousand, net of tax effect, in additional non-interest expense in the third quarter of 2012.

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)   6/30/2012     3/31/2012     12/31/2011     9/30/2011     6/30/2011  
                                         
Summary of Operations:                                        
  Interest income   $ 1,465     $ 1,459     $ 1,464     $ 1,509     $ 1,516  
  Interest expense     323       351       380       382       362  
    Net interest income     1,142       1,108       1,084       1,127       1,154  
  Provision for loan and lease loss     25       45       35       30       84  
    Net interest income after provision for loan loss     1,117       1,063       1,049       1,097       1,070  
  Non-interest income     77       102       127       99       99  
  Non-interest expense     994       974       964       989       884  
    Income before income tax expense     200       191       212       207       285  
  Income tax expense     88       83       74       94       126  
    Net income   $ 112     $ 108     $ 138     $ 113     $ 159  
                                         
Per Common Share(1):                                        
    Basic   $ 0.06     $ 0.06     $ 0.08     $ 0.06     $ 0.09  
    Diluted     0.06       0.06       0.08       0.06       0.09  
  Book value per share     8.57       8.47       8.41       8.38       8.26  
    Average shares outstanding     1,818       1,818       1,818       1,818       1,818  
    Average diluted shares outstanding     1,818       1,818       1,818       1,818       1,818  
                                         
Selected Financial Ratios:                                        
  Return on average assets     0.34 %     0.32 %     0.43 %     0.35 %     0.52 %
  Return on average common equity     2.90 %     2.81 %     3.62 %     3.00 %     4.29 %
  Average equity to average assets     11.80 %     11.47 %     11.73 %     11.70 %     12.03 %
  Risk-based capital:                                        
    Total risk-based capital ratio     16.15 %     16.67 %     16.39 %     16.35 %     15.58 %
    Tier 1 risk-based capital ratio     14.99 %     15.49 %     15.25 %     15.16 %     14.43 %
    Tier 1 leverage capital ratio     11.50 %     11.16 %     11.41 %     11.17 %     11.50 %
                                         
Financial Condition:                                        
  Total assets   $ 131,336     $ 132,176     $ 132,050     $ 129,402     $ 125,826  
  Loans, net of unearned income     90,440       87,794       87,857       86,938       89,678  
  Deposits     115,345       116,385       116,394       113,821       110,518  
  Shareholder's equity     15,587       15,406       15,293       15,231       15,024  
                                         
(1) Data have been restated to give effect to the 5% stock dividend paid in 2012.
 

 

New Jersey Community Bank      
Statements of Financial Condition      
(dollars in thousands, except share data)      
             
    June 30,     December 31,  
    2012     2011  
Assets     (unaudited)          
    Cash and due from banks - non-interest bearing   $ 944     $ 1,519  
    Federal funds sold and interest-bearing deposits with banks     11,510       12,877  
          Total Cash and Cash Equivalents     12,454       14,396  
    Due from banks - time deposits     5,671       6,671  
    Investment Securities:                
      Available-for-sale     17,132       18,719  
      Held-to-maturity     2,943       1,469  
          Total Investment Securities     20,075       20,188  
    Loans Receivable, net of unearned income     90,440       87,857  
        Less: Allowance for loan losses     (1,164 )     (1,101 )
          Net Loans     89,276       86,756  
    Premises and equipment, net     2,529       2,610  
    Accrued interest receivable     375       363  
    Deferred tax assets     617       753  
    Other assets     339       281  
          Total Assets   $ 131,336     $ 132,018  
                 
Liabilities and Shareholders' Equity                
  Liabilities                
    Deposits:                
      Non-interest bearing   $ 7,446     $ 6,057  
      Savings, NOW and money market     39,835       36,508  
      Time deposits $100M and over     46,510       50,483  
      Time deposits, other     21,554       23,346  
          Total Deposits     115,345       116,394  
                 
    Accrued interest payable     13       15  
    Other liabilities     391       316  
            Total Liabilities     115,749       116,725  
                 
  Shareholders' Equity                
    Common stock, $2 par value; authorized 10,000,000 shares; issued and outstanding 1,817,662 and 1,648,783 shares, respectively     3,635      
 3,462
 
    Surplus     13,804       13,930  
    Accumulated Deficit     (1,928 )     (2,147 )
    Accumulated other comprehensive income (loss)     76       48  
            Total Shareholders' Equity     15,587       15,293  
            Total Liabilities and Shareholders' Equity   $ 131,336     $ 132,018  
                 

 

New Jersey Community Bank
Statements of Income
(unaudited)
(dollars in thousands, except per share data)
                 
    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2012   2011   2012   2011
Interest Income                        
  Loans receivable, including fees   $ 1,345   $ 1,411   $ 2,684   $ 2,761
  Investment securities     104     92     205     169
  Federal funds sold and interest-bearing deposits with banks     7     5     14     8
  Due from banks - interest bearing     9     9     20     18
    Total Interest Income     1,465     1,517     2,923     2,955
Interest Expense                        
  Deposits     323     362     674     697
    Net Interest Income before Provision for Loan Loss     1,142     1,155     2,249     2,258
Provision for Loan Loss     25     84     70     178
    Net Interest Income after Provision for Loan Loss     1,117     1,071     2,179     2,080
Non-Interest Income                        
  Fees and service charges on deposit accounts     53     87     144     168
  Loan fee income     13     6     16     11
  All other income     11     6     20     14
    Total Non-Interest Income     77     99     180     192
Non-Interest Expense                        
  Salaries and employee benefits     587     530     1,151     1,017
  Occupancy and equipment     189     157     379     313
  Data processing services     38     34     78     65
  Professional and other fees     69     48     135     106
  Advertising and promotion     5     9     17     18
  Federal insurance assessment     28     29     57     72
  Other operating expenses     78     78     152     142
    Total Non-Interest Expenses     994     885     1,969     1,734
    Income Before Income Tax Expense     200     285     390     539
  Income tax expense     88     126     170     239
Net Income   $ 112   $ 159   $ 220   $ 300
Income per share:                        
  Basic and diluted   $ 0.06   $ 0.09   $ 0.12   $ 0.16
Weighted average number of common shares outstanding                        
  Basic and diluted     1,818     1,818     1,818     1,818
                         

 

New Jersey Community Bank  
Analysis of Average Balance Sheet and Net Interest Income  
       
    For the Three Months Ended  
    June 30, 2012   June 30, 2011  
    Average         Average   Average         Average  
    Balance     Interest   Rate   Balance     Interest   Rate  
Interest Earning Assets:                                      
  Loans   $ 88,249     $ 1,345   6.13 % $ 90,195     $ 1,411   6.28 %
  Investment securities     20,795       104   2.00 %   15,004       92   2.45 %
  Federal funds sold and interest-bearing deposits with banks     12,776       7   0.21 %   10,478       5   0.18 %
  Due from banks - time deposits     5,602       9   0.63 %   3,598       9   1.03 %
      Total interest-earning assets     127,422       1,465   4.62 %   119,275       1,517   5.10 %
Allowance for loan loss     (1,152 )               (1,095 )            
Cash and due from banks - non-interest bearing     1,244                 1,274              
All other assets     3,900                 4,294              
      Total assets   $ 131,414               $ 123,748              
                                       
Interest Bearing Liabilities:                                      
  Deposits:                                      
    Savings, NOW and money market   $ 39,480       74   0.75 % $ 30,067       82   1.10 %
    Time deposits $100M and over     46,927       162   1.38 %   49,589       185   1.50 %
    Time deposits, other     21,653       87   1.62 %   22,346       95   1.70 %
      Total interest-bearing deposits     108,060       323   1.20 %   102,002       362   1.42 %
                                       
Demand     7,401                 6,601              
Other liabilities     446                 261              
      Total liabilities     115,907                 108,864              
                                       
  Stockholders' equity     15,507                 14,884              
      Total liabilities & stockholders' equity   $ 131,414               $ 123,748              
Net interest income           $ 1,142               $ 1,155      
Average interest rate spread                 3.42 %               3.67 %
Net interest margin                 3.60 %               3.88 %
                                       

Contact Information

  • Contacts at New Jersey Community Bank:

    Robert D. O'Donnell
    Chairman, President and CEO
    rodonnell@njcbk.com

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

    New Jersey Community Bank
    3441 Route Nine North
    Freehold, New Jersey 07728
    (732) 431-2265
    Fax (732) 303-1831
    www.njcbk.com