Sussex Bancorp | Contact: Donald L. Kovach |
399 Route 23 | President/CEO |
Franklin, NJ 07416 | 973-827-2914 |
SUSSEX BANCORP ANNOUNCES FIRST QUARTER 2009 EARNINGS
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FRANKLIN, NEW JERSEY – April 30, 2009– Sussex Bancorp (NASDAQ: “SBBX”) today announced its financial results for the first quarter ended March 31, 2009.
For the quarter ended March 31, 2009, the Company earned net income of $253,000, a decrease of approximately 60.3% from net income of $637,000 for the first quarter of 2008. Basic and diluted earnings per share were $0.08 and $0.19 for the first quarter of 2009 and 2008, respectively. The Company’s first quarter 2009 performance reflects increases in net interest income offset by increased provision for loan losses and a decline in non-interest income.
The Company’s net interest income increased $211 thousand, to $3.1 million for the quarter ended March 31, 2009 from $2.9 million for the first quarter of 2008. The Company’s interest income increased $131 thousand, or 2.3%, to $5.7 million for the three months ended March 31, 2009 from $5.6 million for the first quarter of 2008. The Company’s interest expense decreased $80 thousand, or 3.0%, to $2.6 million for the first quarter of 2009 from $2.7 million for the first quarter of 2008.
The Company’s non-interest income decreased to $1.3 million for the quarter ended March 31, 2009 from $1.7 million for the first quarter of 2008. The decrease in non-interest income is attributable to lower insurance commissions and fees combined with decreased holding gains on trading securities. The Company’s non-interest expense remained unchanged at $3.5 million for the quarters ended March 31, 2009 and 2008. Salary and employee benefits decreased by $96 thousand, occupancy expense decreased $6 thousand, and furniture, fixtures and equipment decreased by $39 thousand. These decreases were offset by increases in FDIC assessments of $55 thousand and expenses related to foreclosed real estate of $161 thousand.
The Company’s provision for loan losses increased to $639 thousand in the first quarter of 2009 from $173 thousand in the first quarter of 2008. The increase reflects an increase in non-performing assets and added reserves necessary to adequately provide for potential collateral shortfalls caused by the decline in current real estate values, combined with increases deemed necessary by management due to continued general economic weakness and its potential impact on our borrowers. At March 31, 2009, non-performing assets totaled $18.1 million compared to $15.0 million at December 31, 2008, as foreclosed real estate increased by $743 thousand, non-accrual loans by $1.3 million and loans past due 90 days and still accruing $1.0 million. The increase in non-performing assets was primarily related to three real estate secured credit relationships.
The Company’s total deposits increased to $400.7 million at March 31, 2009 from $319.2 million at March 31, 2008. The Company’s gross loans, net of unearned income increased $20.8 million to $323.2 million at March 31, 2009 from $302.4 million at March 31, 2008. At March 31, 2009 the Company had total assets of $481.2 million, compared to total assets of $405.5 million at March 31, 2008. At March 31, 2009, the leverage capital, tier 1 capital to risk weighted assets and total capital to risk weighted assets ratios of Sussex Bank, the Company’s bank subsidiary, were 8.23%, 10.78% and 12.04%, respectively, in excess of the 5%, 6% and 10% required to be deemed “well capitalized” under regulatory requirements.
Separately, the Company announced that its Board of Directors has increased the Company’s stock buyback program, so that the Company may now repurchase up to a total of 400,000 shares of the Company’s common stock. The Company has already repurchased 239,062 shares under this program. Purchases may be made in open market or privately negotiated transactions.
Sussex Bancorp is the holding company for Sussex Bank, which operates through its main office in Franklin, New Jersey and branch offices in Andover, Augusta, Newton, Montague, Sparta, Vernon and Wantage, New Jersey, Port Jervis and Warwick, New York and for the Tri-State Insurance Agency, Inc., a full service insurance agency located in Sussex County, New Jersey.
SUSSEX BANCORP | ||||||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||||||
(Unaudited) | ||||||||||||
(Dollars in thousands, except share data) | March 31, 2009 | March 31, 2008 | December 31, 2008 | |||||||||
ASSETS | ||||||||||||
Cash and due from banks | $ | 10,871 | $ | 11,934 | $ | 7,602 | ||||||
Federal funds sold | 32,930 | 10,350 | 13,310 | |||||||||
Cash and cash equivalents | 43,801 | 22,284 | 20,912 | |||||||||
Interest bearing time deposits with other banks | 2,839 | 100 | 100 | |||||||||
Trading securities | 11,315 | 13,834 | 13,290 | |||||||||
Securities available for sale | 76,589 | 48,997 | 62,272 | |||||||||
Federal Home Loan Bank Stock, at cost | 1,974 | 2,077 | 1,975 | |||||||||
Loans receivable, net of unearned income | 323,204 | 302,402 | 320,880 | |||||||||
Less: allowance for loan losses | 6,412 | 5,309 | 5,813 | |||||||||
Net loans receivable | 316,792 | 297,093 | 315,067 | |||||||||
Foreclosed real estate | 4,607 | 316 | 3,864 | |||||||||
Premises and equipment, net | 8,332 | 8,941 | 8,526 | |||||||||
Accrued interest receivable | 2,032 | 1,944 | 2,115 | |||||||||
Goodwill | 2,820 | 2,820 | 2,820 | |||||||||
Other assets | 10,055 | 7,119 | 9,654 | |||||||||
Total Assets | $ | 481,156 | $ | 405,525 | $ | 440,595 | ||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||
Liabilities: | ||||||||||||
Deposits: | ||||||||||||
Non-interest bearing | $ | 36,215 | $ | 42,621 | $ | 34,784 | ||||||
Interest bearing | 364,461 | 276,626 | 325,297 | |||||||||
Total Deposits | 400,676 | 319,247 | 360,081 | |||||||||
Borrowings | 33,132 | 36,187 | 33,146 | |||||||||
Accrued interest payable and other liabilities | 2,525 | 2,336 | 2,571 | |||||||||
Junior subordinated debentures | 12,887 | 12,887 | 12,887 | |||||||||
Total Liabilities | 449,220 | 370,657 | 408,685 | |||||||||
Total Stockholders' Equity | 31,936 | 34,868 | 31,910 | |||||||||
Total Liabilities and Stockholders' Equity | $ | 481,156 | $ | 405,525 | $ | 440,595 |
SUSSEX BANCORP | ||||||||
CONSOLIDATED STATEMENTS OF INCOME | ||||||||
(Unaudited) | ||||||||
Three Months Ended March 31, | ||||||||
(Dollars in thousands) | 2009 | 2008 | ||||||
INTEREST INCOME | ||||||||
Loans receivable, including fees | $ | 4,808 | $ | 4,811 | ||||
Securities: | ||||||||
Taxable | 627 | 524 | ||||||
Tax-exempt | 273 | 236 | ||||||
Federal funds sold | 12 | 24 | ||||||
Interest bearing deposits | 7 | 1 | ||||||
Total Interest Income | 5,727 | 5,596 | ||||||
INTEREST EXPENSE | ||||||||
Deposits | 2,169 | 2,130 | ||||||
Borrowings | 352 | 382 | ||||||
Junior subordinated debentures | 104 | 193 | ||||||
Total Interest Expense | 2,625 | 2,705 | ||||||
Net Interest Income | 3,102 | 2,891 | ||||||
PROVISION FOR LOAN LOSSES | 639 | 173 | ||||||
Net Interest Income after Provision for Loan Losses | 2,463 | 2,718 | ||||||
OTHER INCOME | ||||||||
Service fees on deposit accounts | 367 | 351 | ||||||
ATM fees | 107 | 105 | ||||||
Insurance commissions and fees | 614 | 743 | ||||||
Investment brokerage fees | 47 | 47 | ||||||
Holding gains on trading securities | 35 | 217 | ||||||
Gain on sale of securities, available for sale | - | 84 | ||||||
Loss on sale of foreclosed real estate | (1 | ) | - | |||||
Other | 168 | 132 | ||||||
Total Other Income | 1,337 | 1,679 | ||||||
OTHER EXPENSES | ||||||||
Salaries and employee benefits | 1,783 | 1,879 | ||||||
Occupancy, net | 352 | 358 | ||||||
Furniture, equipment and data processing | 340 | 373 | ||||||
Stationary and supplies | 45 | 43 | ||||||
Professional fees | 183 | 109 | ||||||
Advertising and promotion | 59 | 126 | ||||||
Insurance | 41 | 38 | ||||||
FDIC Assessment | 150 | 95 | ||||||
Postage and freight | 42 | 38 | ||||||
Amortization of intangible assets | 5 | 15 | ||||||
Expenses related to foreclosed real estate | 183 | 22 | ||||||
Other | 365 | 377 | ||||||
Total Other Expenses | 3,548 | 3,473 | ||||||
Income before Income Taxes | 252 | 924 | ||||||
PROVISION (BENEFIT) FOR INCOME TAXES | (1 | ) | 287 | |||||
Net Income | $ | 253 | $ | 637 |
COMPARATIVE AVERAGE BALANCES AND AVERAGE INTEREST RATES | ||||||||
(Unaudited) | ||||||||
Three Months Ended March 31, | ||||||||||||||||||||||||
(Dollars in thousands) | 2009 | 2008 | ||||||||||||||||||||||
Average | Average | Average | Average | |||||||||||||||||||||
Interest earning assets: | Balance | Interest (1) | Rate (2) | Balance | Interest (1) | Rate (2) | ||||||||||||||||||
Securities: | ||||||||||||||||||||||||
Tax exempt (3) | $ | 26,709 | $ | 278 | 4.22 | % | $ | 22,643 | $ | 352 | 6.25 | % | ||||||||||||
Taxable | 56,817 | 627 | 4.48 | % | 40,389 | 524 | 5.22 | % | ||||||||||||||||
Total securities | 83,526 | 905 | 4.39 | % | 63,032 | 876 | 5.59 | % | ||||||||||||||||
Total loans receivable (4) | 322,535 | 4,808 | 6.05 | % | 300,024 | 4,811 | 6.45 | % | ||||||||||||||||
Other interest-earning assets | 26,676 | 19 | 0.29 | % | 2,941 | 25 | 3.42 | % | ||||||||||||||||
Total interest earning assets | 432,737 | $ | 5,732 | 5.37 | % | 365,997 | $ | 5,712 | 6.28 | % | ||||||||||||||
Non-interest earning assets | 34,492 | 29,437 | ||||||||||||||||||||||
Allowance for loan losses | (6,000 | ) | (5,226 | ) | ||||||||||||||||||||
Total Assets | $ | 461,228 | $ | 390,208 | ||||||||||||||||||||
Interest bearing liabilities: | ||||||||||||||||||||||||
Interest bearing deposits: | ||||||||||||||||||||||||
NOW | $ | 57,897 | $ | 159 | 1.11 | % | $ | 59,235 | $ | 244 | 1.66 | % | ||||||||||||
Money market | 14,703 | 48 | 1.33 | % | 32,716 | 215 | 2.65 | % | ||||||||||||||||
Savings | 159,739 | 1,026 | 2.61 | % | 38,504 | 112 | 1.17 | % | ||||||||||||||||
Time | 112,901 | 936 | 3.36 | % | 136,092 | 1,559 | 4.61 | % | ||||||||||||||||
Total interest bearing deposits | 345,240 | 2,169 | 2.55 | % | 266,547 | 2,130 | 3.21 | % | ||||||||||||||||
Borrowed funds | 33,138 | 352 | 4.25 | % | 35,650 | 382 | 4.24 | % | ||||||||||||||||
Junior subordinated debentures | 12,887 | 104 | 3.22 | % | 12,887 | 193 | 5.91 | % | ||||||||||||||||
Total interest bearing liabilities | 391,265 | $ | 2,625 | 2.72 | % | 315,084 | $ | 2,705 | 3.45 | % | ||||||||||||||
Non-interest bearing liabilities: | ||||||||||||||||||||||||
Demand deposits | 36,479 | 38,653 | ||||||||||||||||||||||
Other liabilities | 1,261 | 1,844 | ||||||||||||||||||||||
Total non-interest bearing liabilities | 37,740 | 40,497 | ||||||||||||||||||||||
Stockholders' equity | 32,223 | 34,627 | ||||||||||||||||||||||
Total Liabilities and Stockholders' Equity | $ | 461,228 | $ | 390,208 | ||||||||||||||||||||
Net Interest Income and Margin (5) | $ | 3,107 | 2.91 | % | $ | 3,007 | 3.30 | % |
(1) Includes loan fee income |
(2) Average rates on securities are calculated on amortized costs |
(3) Full taxable equivalent basis, using a 39% effective tax rate and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act) interest expense disallowance |
(4) Loans outstanding include non-accrual loans |
(5) Represents the difference between interest earned and interest paid, divided by average total interest-earning assets |