Center Bancorp, Inc. Reports Second Quarter 2009 Earnings
NJ -- (GLOBE NEWSWIRE) -- 07/30/2009 -- Center Bancorp, Inc. (NASDAQ: CNBC), parent company of Union Center National Bank (UCNB), today reported operating results for the second quarter ended June 30, 2009. Net income amounted to $1.2 million, or $0.08 per fully diluted common share, for the quarter ended June 30, 2009, as compared with earnings of $1.4 million, or $0.11 per fully diluted common share, for the quarter ended June 30, 2008.
For the six months ended June 30, 2009, net income amounted to $2.0 million, or $0.13 per fully diluted common share, as compared to $2.6 million, or $0.20 per fully diluted common share, for the same period in 2008.
President & CEO’s Remarks
"Center Bancorp continues to reflect strong core performance despite difficult economic conditions in the second quarter,” indicated Anthony C. Weagley, President & CEO. "Most notably, we see overall growth in our core business, a continued growth of deposits, loans and most important, client relationships. This continues to translate into improved balance sheet trends. Certain credit quality indicators improved, such as reduced net charge-offs and other real estate owned (OREO) compared to the previous quarter. We remain cautiously optimistic on market trends and resulting challenges in the months ahead. Furthermore, we believe we have taken the appropriate actions in dealing with the financial crisis and have positioned ourselves to continue to expand our franchise and build shareholder value. Another key factor underpinning our performance is the control of operating overhead.”
The Corporation continued to focus on building a superior balance sheet and increasing its liquidity. This resulted in a minor compression in net interest margin in the quarter and in year-to-date key performance measures. As of June 30, 2009, the Corporation maintained $173.6 million in cash at the Federal Reserve Bank of New York compared to $10.8 million at December 31, 2008. This represented growth in the Corporation’s customer base and enhanced our liquidity position while we continue to expand our earning asset base in a prudent manner. Further, the Corporation has had no outstanding overnight borrowings under its $93.7 million line of credit facility with the Federal Home Loan Bank of New York since October 2008. The Corporation's available for sale investment portfolio provides an additional source of liquidity.
“During the second quarter, the Corporation recorded an increase in other real estate expense of $1.3 million coupled with higher FDIC insurance expense of $920,000 due primarily to an additional expense taken on the special assessment coupled with changes in the premium rates. Taken together, these increases reduced second quarter earnings by approximately $0.10 per fully diluted common share, and skewed our efficiency ratio measurement for the period,” indicated Mr. Weagley.
“Despite these actions, we maintained solid core quarterly earnings, which fortified an already strong capital position. Overall, loans continued to show marked growth with commercial and commercial real estate demand still gaining strength, while new production of 1-4 family loans for sale into the secondary market coupled with refinancing activity reduced the residential loan portfolio. As we move forward, our focus will remain on preserving and growing our core business, and providing sound, prudent management of the Corporation."
Key items for the quarter include:
| § | Net income of $1,201,000 for the second quarter of 2009 compared with net income of $799,000 for the first quarter of 2009 and $1.4 million for the second quarter of 2008. |
| § | EPS of $0.08 per fully diluted common share compared with $0.05 per fully diluted common share for the first quarter of 2009 and $0.11 per fully diluted common share for the comparable second quarter period of 2008. Dividends and accretion relating to the preferred stock and warrants issued to the U.S. Treasury reduced earnings by approximately $0.01 per fully diluted common share. |
| § | Other real estate expense increased by $1.3 million compared to the same quarter last year, due primarily to the recognition of a $926,000 write-down coupled with the continued build out costs relating to the residential real estate condominium project in Union County, New Jersey. The Corporation currently has a contract for sale on this project, which is expected to close in the third quarter of 2009. |
| § | FDIC insurance expense increased $920,000 over the same quarter last year due to the recording of the mandated FDIC special assessment, which amounted to $630,000, along with higher FDIC assessments resulting from changes in the premium rates. |
| § | Overall credit quality in the Bank’s portfolio remains high, even though the economic weakness has impacted several potential problem loans. Non-performing assets amounted to 0.80% of total assets at June 30, 2009 compared to 0.81% at March 31, 2009 and 0.04% at June 30, 2008. |
| § | Strong Tier 1 capital ratio of 7.52% at June 30, 2009, 8.42% at March 31, 2009, and 8.03% at June 30, 2008. |
| § | A contraction in annualized net interest margin by 8 basis points to 2.73% compared to 2.81% for the first quarter of 2009 and down 27 basis points as compared to the comparable quarter of 2008, as a high level of uninvested excess cash has been accumulated due to strong deposit growth experienced during the quarter. |
| § | An increase in deposits to $955.1 million at June 30, 2009 from $768.4 million at March 31, 2009 and $621.2 million at June 30, 2008, reflecting inflows in core savings deposits and CDARS Reciprocal deposits, as customers’ desires for safety and liquidity became paramount in light of the financial crisis. |
| § | Book value per common share amounting to $6.14 at June 30, 2009 compared to $6.15 at March 31, 2009 and $6.18 at June 30, 2008. Tangible book value per common share was $4.83 at June 30, 2009 compared to $4.83 at March 31, 2009 and $4.86 at June 30, 2008. |
Selected financial ratios (annualized where applicable)
| As of or for the quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Return on average assets | 0.40 | % | 0.30 | % | 0.66 | % | 0.60 | % | 0.57 | % | 0.50 | % | ||||||||||||
| Return on average equity | 5.35 | % | 3.52 | % | 8.38 | % | 7.55 | % | 6.69 | % | 5.60 | % | ||||||||||||
| Net interest margin (tax equivalent basis) | 2.73 | % | 2.81 | % | 3.01 | % | 3.09 | % | 3.00 | % | 2.74 | % | ||||||||||||
| Loan/Deposit ratio | 72.68 | % | 88.24 | % | 102.53 | % | 97.64 | % | 101.61 | % | 90.71 | % | ||||||||||||
| Stockholders' equity/total assets | 6.67 | % | 7.98 | % | 7.99 | % | 7.73 | % | 8.15 | % | 8.58 | % | ||||||||||||
| Efficiency ratio | 96.3 | % | 72.5 | % | 59.7 | % | 55.4 | % | 67.7 | % | 70.9 | % | ||||||||||||
| Book value per common share | $ | 6.14 | $ | 6.15 | $ | 6.29 | $ | 6.21 | $ | 6.18 | $ | 6.51 | ||||||||||||
| Return on average tangible stockholders' equity | 6.61 | % | 4.33 | % | 10.62 | % | 9.60 | % | 8.41 | % | 6.98 | % | ||||||||||||
| Tangible common stockholders' equity/tangible assets | 4.74 | % | 5.69 | % | 6.42 | % | 6.19 | % | 6.52 | % | 6.98 | % | ||||||||||||
| Tangible book value per common share | $ | 4.83 | $ | 4.83 | $ | 4.97 | $ | 4.89 | $ | 4.86 | $ | 5.20 | ||||||||||||
Capital and Liquidity
Center remained well capitalized with strong liquidity in the second quarter of 2009. Total stockholders' equity amounted to $89.5 million, or 6.67% of total assets, at June 30, 2009. Tangible common stockholders' equity was $62.8 million, or 4.74% of tangible assets. Book value per common share was $6.14 at June 30, 2009, compared to $6.18 at June 30, 2008. Tangible book value per common share was $4.83 at June 30, 2009 compared to $4.86 at June 30, 2008.
At June 30, 2009, the Corporation’s Tier 1 Capital Leverage ratio was 7.52%, the Corporation’s total Tier 1 Risk Based Capital ratio was 10.46% and the Corporation’s Total Risk Based Capital ratio was 11.28%. Total Tier 1 capital increased to approximately $88.6 million at June 30, 2009 from $78.2 million at December 31, 2008, reflecting the Corporation’s participation in the TARP Capital Purchase Program. At June 30, 2009, the Corporation’s capital ratios continued to exceed each of the minimum Federal requirements for a bank holding company, and Union Center National Bank’s capital ratios continued to exceed each of the minimum levels required for classification as a “well capitalized institution” under the Federal Deposit Insurance Corporation Improvement Act.
The Corporation also announced that its Board of Directors has authorized a rights offering of up to approximately $11 million of common stock to its existing stockholders. The Corporation expects to use the net proceeds from the proposed rights offering to purchase the shares of preferred stock and the warrant to purchase shares of common stock issued to the U.S. Department of the Treasury in January 2009 under the TARP Capital Purchase Program.
Under the proposed rights offering, each shareholder of record as of a record date to be determined will receive, at no charge, one non-transferable subscription right for each share of Center Bancorp common stock owned on the record date. Each right will entitle the holder to purchase its pro rata allocation of the shares to be offered at a subscription price which is expected to be at a discount from the average market price of the Company's common stock for several trading days prior to the commencement of the rights offering. The proposed rights offering will also include an over-subscription privilege which will entitle each rights holder that exercises its basic subscription privilege in full to purchase any shares not purchased by other shareholders pursuant to the exercise of their basic subscription privileges at the same subscription price. Lawrence B. Seidman, an existing shareholder and member of the Corporation’s Board of Directors, and certain of his affiliates have agreed to purchase any shares of common stock that remain unsubscribed for at the same price as the subscription price.
The Corporation anticipates that the specific terms of the rights offering will be determined, and the rights offering will commence, within the next month.
Center Bancorp plans to file a registration statement with the Securities and Exchange Commission pertaining to the rights offering. This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction, nor shall there be any offer or sale of the common stock referred to in this press release in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. The proposed rights offering will be made only by means of a prospectus.
Asset Quality
At June 30, 2009, non-performing assets totaled $10.8 million, or 0.80% of total assets, as compared with $9.1 million, or 0.81%, at March 31, 2009 and $0.4 million, or 0.04%, at June 30, 2008.
“While overall credit quality in the Bank’s portfolio remains high, continued economic weakness has impacted several problem loans in the portfolio which have been previously disclosed. Non-accrual loans increased from $4.6 million at March 31, 2009 to $5.0 million at June 30, 2009; this increase was due primarily to the addition of one residential mortgage credit. Troubled debt restructurings increased from $91,000 at March 31, 2009 to $1.0 million at June 30, 2009; the increase in troubled debt restructurings reflects modifications to residential mortgage loans, which are all performing according to the terms in their respective modification agreements. Loans past due 90 days or more and still accruing increased from none at March 31, 2009 to $1.3 million at June 30, 2009 due to three new credits which are well secured and in the process of collection. With respect to the $4.0 million industrial warehouse project placed into non-accrual during the first quarter of 2009, we are currently working with the borrowers and the participating bank that is involved with the project, in an effort to sell or lease the remaining industrial warehouse units. Proceeds from the current units under contract, as well as the remaining units, will be used to make further principal reductions to our loan,” remarked Mr. Weagley.
The OREO balance decreased from $4.4 million at March 31, 2009 to $3.5 million at June 30, 2009. This decrease was related to the writedown of the carrying value of the residential condominium project that was taken into OREO during the fourth quarter of 2008. The Corporation currently has a contract for sale on the project, which is expected to close during the third quarter of 2009. Had this sale occurred on June 30, 2009, the Corporation’s total non-performing assets would have reflected a significant improvement from March 31, 2009. The Corporation expects to record a gain on the sale of the property in the approximate amount of $150,000.
At June 30, 2009, the total allowance for loan losses amounted to approximately $6.9 million, or 1.00% of total loans. The allowance for loan losses as a percent of total non-performing loans amounted to 94.8% at June 30, 2009 as compared to 145.4% at March 31, 2009 and 1,563.5% at June 30, 2008.
Selected credit quality ratios (unaudited)
| (Dollars in thousands) | ||||||||||||||||||||||||
| As of or for the quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Non-accrual loans | $ | 5,058 | $ | 4,566 | $ | 541 | $ | 541 | $ | 265 | $ | 1,215 | ||||||||||||
| Troubled debt restructuring | 975 | 91 | 93 | 95 | 97 | - | ||||||||||||||||||
| Past due loans 90 days or more and still accruing interest | 1,260 | - | 139 | 18 | - | - | ||||||||||||||||||
| Total non performing loans | 7,293 | 4,657 | 773 | 654 | 362 | 1,215 | ||||||||||||||||||
| Other real estate owned (“OREO”) | 3,500 | 4,426 | 3,949 | - | - | 478 | ||||||||||||||||||
| Total non performing assets | $ | 10,793 | $ | 9,083 | $ | 4,722 | $ | 654 | $ | 362 | $ | 1,693 | ||||||||||||
| Non performing assets as a percentage of total assets | 0.80 | % | 0.81 | % | 0.46 | % | 0.06 | % | 0.04 | % | 0.17 | % | ||||||||||||
| Non performing loans as a percentage of total loans | 1.05 | % | 0.69 | % | 0.11 | % | 0.10 | % | 0.06 | % | 0.22 | % | ||||||||||||
| Net charge-offs | $ | 8 | $ | 906 | $ | 251 | $ | 45 | $ | 106 | $ | 68 | ||||||||||||
| Net charge-offs as a percentage of average loans for the period (annualized) | 0.00 | % | 0.53 | % | 0.15 | % | 0.03 | % | 0.07 | % | 0.05 | % | ||||||||||||
| Allowance for loan losses as a percentage of period end loans | 1.00 | % | 1.00 | % | 0.92 | % | 0.92 | % | 0.90 | % | 0.93 | % | ||||||||||||
| Allowance for loan losses as a percentage of non-performing loans | 94.8 | % | 145.4 | % | 809.1 | % | 929.7 | % | 1,563.5 | % | 431.7 | % | ||||||||||||
| Total Assets | $ | 1,341,603 | $ | 1,121,013 | $ | 1,023,293 | $ | 1,042,778 | $ | 986,436 | $ | 995,167 | ||||||||||||
| Total Loans | 694,214 | 678,017 | 676,203 | 661,157 | 631,221 | 565,025 | ||||||||||||||||||
| Average loans for the quarter | 686,675 | 679,953 | 670,212 | 651,766 | 601,655 | 565,654 | ||||||||||||||||||
| Allowance for loan losses | 6,917 | 6,769 | 6,254 | 6,080 | 5,660 | 5,245 | ||||||||||||||||||
Net Interest Income and Margin
The Corporation recorded net interest income on a fully taxable equivalent basis of $6.8 million for the three months ended June 30, 2009 as compared to $6.8 million for the comparable quarter in 2008. Interest income increased by $0.3 million and interest expense increased by $0.3 million from the same period last year. Compared to 2008, average interest earning assets increased by $88.4 million while the net interest spread and net interest margin improved by 6 basis points and decreased by 27 basis points, respectively. On a linked quarter basis, the net interest spread and margin increased by 12 basis points and decreased by 8 basis points, respectively. Our net interest margin was impacted by the high level of uninvested excess cash, which accumulated due to strong deposit growth experienced during the quarter.
For the six months ended June 30, 2009, net interest income on a fully taxable equivalent basis amounted to $13.3 million as compared to $12.9 million for the same period in 2008. Interest income declined by $0.4 million while interest expense decreased by $0.8 million from the same period last year. Compared to 2008, average interest earning assets increased $65.0 million while our net interest spread and margin increased by 17 basis points and decreased by 10 basis points, respectively. Our net interest margin was impacted by the high level of uninvested excess cash, which accumulated due to strong deposit growth experienced during the first six months.
Quarterly Condensed Consolidated Income Statements (unaudited)
| (Dollars in thousands, except per share data) | ||||||||||||||||||||||||
| For the quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Net interest income | $ | 6,627 | $ | 6,379 | $ | 6,823 | $ | 6,860 | $ | 6,429 | $ | 5,687 | ||||||||||||
| Provision for loan losses | 156 | 1,421 | 425 | 465 | 521 | 150 | ||||||||||||||||||
| Net interest income after provision for loan losses | 6,471 | 4,958 | 6,398 | 6,395 | 5,908 | 5,537 | ||||||||||||||||||
| Other income | 2,551 | 1,384 | 615 | 47 | 1,116 | 866 | ||||||||||||||||||
| Other expense | (7,314 | ) | (5,319 | ) | (4,754 | ) | (4,578 | ) | (5,188 | ) | (4,953 | ) | ||||||||||||
| Income before income tax | 1,708 | 1,023 | 2,259 | 1,864 | 1,836 | 1,450 | ||||||||||||||||||
| Income tax expense | 507 | 224 | 560 | 346 | 428 | 233 | ||||||||||||||||||
| Net income | 1,201 | 799 | 1,699 | 1,518 | 1,408 | 1,217 | ||||||||||||||||||
| Net income available to common stockholders | $ | 1,053 | $ | 670 | $ | 1,699 | $ | 1,518 | $ | 1,408 | $ | 1,217 | ||||||||||||
| Earnings per common share: | ||||||||||||||||||||||||
| Basic | $ | 0.08 | $ | 0.05 | $ | 0.13 | $ | 0.12 | $ | 0.11 | $ | 0.09 | ||||||||||||
| Diluted | $ | 0.08 | $ | 0.05 | $ | 0.13 | $ | 0.12 | $ | 0.11 | $ | 0.09 | ||||||||||||
| Weighted average common shares outstanding: | ||||||||||||||||||||||||
| Basic | 12,994,429 | 12,991,312 | 12,989,304 | 12,990,441 | 13,070,868 | 13,144,747 | ||||||||||||||||||
| Diluted | 12,996,544 | 12,993,185 | 12,995,134 | 13,003,954 | 13,083,558 | 13,163,586 | ||||||||||||||||||
Other Income
Total other income increased $1.4 million for the second quarter of 2009 compared with the comparable quarter of 2008, primarily as a result of net securities gains. During the second quarter of 2009, the Corporation recorded net securities gains of $1.7 million. Excluding net securities gains, the Corporation recorded other income of $841,000 for the three months ended June 30, 2009 compared to $891,000 for the three months ended June 30, 2008, a decrease of $50,000 or 5.6%. This decrease was due primarily to lower levels of service charges offset in part by higher income on bank owned life insurance and commissions from sales of mutual funds and annuities.
For the six months ended June 30, 2009, total other income increased $2.0 million compared to the same period in 2008, primarily as a result of net securities gains. Excluding net securities gains, the Corporation recorded other income of $1.6 million for the six months ended June 30, 2009 compared to $1.7 million for the comparable period in 2008, a decrease of $132,000 or 7.5%. This decrease was primarily the result of lower levels of service charges offset partially by higher income on bank owned life insurance and commissions from sales of mutual funds and annuities.
Quarterly Consolidated Non-Interest Income (unaudited)
| (Dollars in thousands) | ||||||||||||||||||||||||
| For the quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Service charges on deposit accounts | $ | 324 | $ | 343 | $ | 376 | $ | 360 | $ | 383 | $ | 404 | ||||||||||||
| Commissions from mortgage broker activities | - | 2 | 7 | 6 | 17 | 12 | ||||||||||||||||||
| Loan related fees (LOC) | 45 | 30 | 53 | 46 | 37 | 41 | ||||||||||||||||||
| Commissions from sale of mutual funds and annuities | 45 | 40 | 22 | 35 | 38 | 17 | ||||||||||||||||||
| Debit card and ATM fees | 116 | 106 | 113 | 124 | 130 | 125 | ||||||||||||||||||
| Bank owned life insurance | 257 | 218 | 247 | 507 | 228 | 221 | ||||||||||||||||||
| Net securities gains (losses) | 1,710 | 600 | (256 | ) | (1,075 | ) | 225 | - | ||||||||||||||||
| Other service charges and fees | 54 | 45 | 53 | 44 | 58 | 46 | ||||||||||||||||||
| Total other income | $ | 2,551 | $ | 1,384 | $ | 615 | $ | 47 | $ | 1,116 | $ | 866 | ||||||||||||
Other Expense
Other expense for the second quarter of 2009 totaled $7.3 million, an increase of $2.1 million, or 41.0%, from the comparable period in 2008. For the six months ended June 30, 2009, other expense totaled $12.6 million, an increase of $2.5 million, or 24.6%. In May 2009, the FDIC adopted a final rule on the special assessment that will assess the industry 5 basis points on total assets less Tier 1 capital. The Corporation was required to accrue the charge during the second quarter of 2009, which amounted to approximately $630,000, even though the FDIC will collect the fee at the end of the third quarter when the regular quarterly assessments for the second quarter are collected. Additionally, in December 2008, the FDIC adopted a final rule increasing risk-based assessment rates beginning in the first quarter of 2009. As a result of these changes coupled with one-time assessment credits recognized in 2008, FDIC insurance expense amounted to $940,000 in the second quarter of 2009, an increase of $920,000, or 4,600%, over the comparable period in 2008. For the six months ended June 30, 2009, FDIC insurance expense increased $1.3 million, or 3,163%. OREO expense for the second quarter of 2009 and six months ended June 30, 2009 increased by $1.3 million compared to the same quarter and six month period last year, respectively, due primarily to the recognition of a $926,000 writedown coupled with the continued build out costs relating to the residential real estate condominium project in Union County, New Jersey. The Corporation currently has a contract for sale on this project, which is expected to close in the third quarter of 2009.
The efficiency ratio for the second quarter of 2009 was 96.3% as compared to 67.7% in the second quarter of 2008. For the six months ended June 30, 2009, the efficiency ratio was 84.6% as compared to 69.2% in the same period of 2008. This increase was due primarily to the increase in FDIC insurance expense and OREO expense.
Quarterly Consolidated Non-Interest Expense (unaudited)
| (Dollars in thousands) | ||||||||||||||||||||||||
| For the quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Employee salaries and wages | $ | 1,946 | $ | 1,861 | $ | 1,777 | $ | 1,752 | $ | 2,013 | $ | 1,896 | ||||||||||||
| Employee stock option expense | 25 | 22 | 23 | 23 | 36 | 45 | ||||||||||||||||||
| Health insurance and other employee benefits | 362 | 309 | (246 | ) | (32 | ) | 285 | 218 | ||||||||||||||||
| Payroll taxes | 166 | 194 | 139 | 167 | 182 | 179 | ||||||||||||||||||
| Other employee related expenses | 8 | 7 | 17 | 9 | 8 | 14 | ||||||||||||||||||
| Total salaries and employee benefits | $ | 2,507 | $ | 2,393 | $ | 1,710 | $ | 1,919 | $ | 2,524 | $ | 2,352 | ||||||||||||
| Occupancy, net | 583 | 797 | 983 | 803 | 734 | 759 | ||||||||||||||||||
| Premises and equipment | 319 | 321 | 362 | 352 | 356 | 366 | ||||||||||||||||||
| Professional and consulting | 236 | 212 | 152 | 189 | 190 | 172 | ||||||||||||||||||
| Stationery and printing | 102 | 70 | 97 | 87 | 118 | 95 | ||||||||||||||||||
| FDIC Insurance | 940 | 365 | 149 | 28 | 20 | 20 | ||||||||||||||||||
| Marketing and advertising | 141 | 130 | 144 | 145 | 188 | 160 | ||||||||||||||||||
| Computer expense | 228 | 214 | 229 | 238 | 226 | 141 | ||||||||||||||||||
| Bank regulatory related expenses | 60 | 60 | 55 | 54 | 55 | 58 | ||||||||||||||||||
| Postage and delivery | 64 | 46 | 69 | 67 | 65 | 78 | ||||||||||||||||||
| ATM related expenses | 61 | 61 | 59 | 61 | 62 | 60 | ||||||||||||||||||
| OREO expense (benefit) | 1,375 | 33 | - | (44 | ) | 31 | 33 | |||||||||||||||||
| Amortization of core deposit intangible | 22 | 22 | 23 | 23 | 24 | 25 | ||||||||||||||||||
| Other expenses | 676 | 595 | 722 | 656 | 595 | 634 | ||||||||||||||||||
| Total other expense | $ | 7,314 | $ | 5,319 | $ | 4,754 | $ | 4, 578 | $ | 5,188 | $ | 4,953 | ||||||||||||
Key Balance Sheet Changes at June 30, 2009
| § | The Corporation had total loans of $694.2 million at June 30, 2009, an $18.0 million, or 2.7%, increase from December 31, 2008 and a $63.0 million, or 10.0%, increase from June 30, 2008. |
| § | Loan growth continued during the quarter in the Corporation’s commercial related segment of the portfolio. Total gross loans booked for the quarter included $52.6 million of new loans and $12.5 million in advances principally offset by payoffs and principal payments of $48.9 million . |
| § | At June 30, 2009, the Corporation had $44.9 million in overall undispersed loan commitments, which are expected to fund over the next 90 days. |
| § | Loan originations and pipelines for the quarter increased in the commercial sector, primarily in the commercial real estate segment of the loan portfolio. |
Loan Mix:
(unaudited)
| (Dollars in thousands) | ||||||||||||||||||||||||
| At quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Real estate loans | ||||||||||||||||||||||||
| Residential | $ | 218,340 | $ | 229,903 | $ | 240,316 | $ | 249,258 | $ | 255,817 | $ | 260,237 | ||||||||||||
| Commercial | 262,676 | 256,885 | 256,527 | 246,089 | 224,990 | 163,664 | ||||||||||||||||||
| Construction | 54,105 | 41,242 | 42,075 | 47,722 | 50,638 | 48,494 | ||||||||||||||||||
| Total real estate loans | 535,121 | 528,030 | 538,918 | 543,069 | 531,445 | 472,395 | ||||||||||||||||||
| Commercial loans | 157,621 | 148,444 | 135,232 | 116,891 | 98,845 | 91,492 | ||||||||||||||||||
| Consumer and other loans | 921 | 928 | 1,481 | 672 | 339 | 592 | ||||||||||||||||||
| Total loans before unearned fees and costs | 693,663 | 677,402 | 675,631 | 660,632 | 630,629 | 564,479 | ||||||||||||||||||
| Unearned fees and costs, net | 551 | 615 | 572 | 525 | 592 | 546 | ||||||||||||||||||
| Total loans | $ | 694,214 | $ | 678,017 | $ | 676,203 | $ | 661,157 | $ | 631,221 | $ | 565,025 | ||||||||||||
| § | Investment securities increased by $125.1 million at June 30, 2009 compared to June 30, 2008 and increased by $136.2 million when compared to December 31, 2008. |
| § | Deposits totaled $955.1 million at June 30, 2009, an increase of $295.6 million from December 31, 2008 and an increase of $334.0 million from June 30, 2008. |
| § | Total deposit funding sources, including overnight repurchase agreements (which agreements are part of the demand deposit base), amounted to $979.3 million at June 30, 2009, an increase of $289.6 million from December 31, 2008, which reflected inflows in core savings deposits and CDARS Reciprocal deposits, as customers’ needs for safety and more liquidity became paramount in light of the financial crisis. |
| § | Time certificates of deposit of $100,000 and over increased $169.3 million as compared to December 31, 2008 due primarily to an increase in CDARS Reciprocal deposits, which has become an attractive product for customers who are sensitive to obtaining full FDIC insurance for their time deposits. |
| § | The Corporation expects its deposit gathering efforts to remain strong, supported in part by the recent actions by the FDIC in temporarily raising the deposit insurance limits. The Corporation is a participant in the FDIC’s Transaction Account Guarantee Program. Under this program, all non-interest bearing deposit transaction accounts are fully guaranteed by the FDIC, regardless of dollar amount, through December 31, 2009. The FDIC is currently seeking comment on whether to allow the guarantee to expire as scheduled on December 31, 2009 or extend the guarantee through June 30, 2010, with increased fees. |
| § | Borrowings totaled $252.5 million at June 30, 2009, reflecting a decrease of $21.1 million from December 31, 2008. |
The following table reflects the Corporation’s deposits for the periods specified.
Deposit Mix
(unaudited)
| (Dollars in thousands) | ||||||||||||||||||||||||
| At quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Checking accounts | ||||||||||||||||||||||||
| Non interest bearing | $ | 130,115 | $ | 114,607 | $ | 113,319 | $ | 114,631 | $ | 110,891 | $ | 117,053 | ||||||||||||
| Interest bearing | 137,578 | 132,682 | 139,349 | 129,070 | 124,469 | 125,152 | ||||||||||||||||||
| Savings deposits | 185,074 | 137,197 | 66,359 | 61,623 | 63,918 | 68,028 | ||||||||||||||||||
| Money market accounts | 129,756 | 114,363 | 111,308 | 140,533 | 147,202 | 170,742 | ||||||||||||||||||
| Time deposits | 372,619 | 269,530 | 229,202 | 231,287 | 174,710 | 141,949 | ||||||||||||||||||
| Total Deposits | $ | 955,142 | $ | 768,379 | $ | 659,537 | $ | 677,144 | $ | 621,190 | $ | 622,924 | ||||||||||||
Additional Information for the Second Quarter 2009
| § | Total assets of $1.3 billion at June 30, 2009, which positions the Corporation as one of the largest New Jersey headquartered financial institutions. |
| § | Continued improvement in earning asset mix from the same quarter last year, as average loans increased by $85.0 million while average investment securities, including federal fund sold, increased by $3.4 million |
| § | The Corporation relocated its Summit Banking Center on May 29, 2009, to the new Promenade Building on Morris Avenue in Summit from its existing downtown facility. |
Quarterly Condensed Consolidated Balance Sheets (unaudited)
| (Dollars in thousands) | ||||||||||||||||||||||||
| At quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Cash and due from banks | $ | 176,784 | $ | 90,634 | $ | 15,031 | $ | 15,952 | $ | 16,172 | $ | 15,155 | ||||||||||||
| Fed funds and money market funds | - | - | - | - | - | 45,300 | ||||||||||||||||||
| Investments | 378,895 | 266,032 | 242,714 | 284,349 | 253,780 | 281,746 | ||||||||||||||||||
| Loans | 694,214 | 678,017 | 676,203 | 661,157 | 631,221 | 565,025 | ||||||||||||||||||
| Allowance for loan losses | (6,917 | ) | (6,769 | ) | (6,254 | ) | (6,080 | ) | (5,660 | ) | (5,245 | ) | ||||||||||||
| Restricted investment in bank stocks, at cost | 10,675 | 10,228 | 10,230 | 10,277 | 10,325 | 10,036 | ||||||||||||||||||
| Premises and equipment, net | 18,430 | 18,313 | 18,488 | 18,545 | 18,203 | 17,404 | ||||||||||||||||||
| Goodwill | 16,804 | 16,804 | 16,804 | 16,804 | 16,804 | 16,804 | ||||||||||||||||||
| Core deposit intangible | 262 | 283 | 306 | 328 | 350 | 375 | ||||||||||||||||||
| Bank owned life insurance | 25,888 | 23,156 | 22,938 | 22,690 | 22,710 | 22,483 | ||||||||||||||||||
| Other real estate owned | 3,500 | 4,426 | 3,949 | - | - | - | ||||||||||||||||||
| Other assets | 23,068 | 19,889 | 22,884 | 18,756 | 22,531 | 26,084 | ||||||||||||||||||
| TOTAL ASSETS | $ | 1,341,603 | $ | 1,121,013 | $ | 1,023,293 | $ | 1,042,778 | $ | 986,436 | $ | 995,167 | ||||||||||||
| Deposits | $ | 955,142 | $ | 768,379 | $ | 659,537 | $ | 677,144 | $ | 621,190 | $ | 622,924 | ||||||||||||
| Borrowings | 252,498 | 255,365 | 273,595 | 281,046 | 279,585 | 279,024 | ||||||||||||||||||
| Other liabilities | 44,505 | 7,840 | 8,448 | 3,964 | 5,268 | 7,818 | ||||||||||||||||||
| Stockholders' equity | 89,458 | 89,429 | 81,713 | 80,624 | 80,393 | 85,401 | ||||||||||||||||||
| TOTAL LIABILITIES AND | ||||||||||||||||||||||||
| STOCKHOLDERS' EQUITY | $ | 1,341,603 | $ | 1,121,013 | $ | 1,023,293 | $ | 1,042,778 | $ | 986,436 | $ | 995,167 | ||||||||||||
Condensed Consolidated Average Balance Sheets (unaudited)
| (Dollars in thousands) | ||||||||||||||||||||||||
| For the quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Investments, Fed funds, and other | $ | 304,482 | $ | 253,445 | $ | 272,507 | $ | 273,337 | $ | 301,118 | $ | 326,397 | ||||||||||||
| Loans | 686,675 | 679,953 | 670,212 | 651,766 | 601,655 | 565,654 | ||||||||||||||||||
| Allowance for loan losses | (6,891 | ) | (6,384 | ) | (6,235 | ) | (5,840 | ) | (5,404 | ) | (5,237 | ) | ||||||||||||
| All other assets | 211,495 | 131,861 | 95,514 | 93,535 | 91,631 | 93,088 | ||||||||||||||||||
| TOTAL ASSETS | $ | 1,195,761 | $ | 1,058,875 | $ | 1,031,998 | $ | 1,012,798 | $ | 989,000 | $ | 979,902 | ||||||||||||
| Deposits-interest bearing | $ | 716,243 | $ | 588,599 | $ | 554,652 | $ | 521,459 | $ | 499,342 | $ | 519,295 | ||||||||||||
| Deposits-non interest bearing | 121,482 | 115,541 | 112,936 | 118,623 | 114,744 | 112,695 | ||||||||||||||||||
| Borrowings | 253,310 | 255,269 | 278,524 | 288,002 | 284,264 | 251,222 | ||||||||||||||||||
| Other liabilities | 14,921 | 8,567 | 4,798 | 4,321 | 6,508 | 9,769 | ||||||||||||||||||
| Stockholders’ equity | 89,805 | 90,899 | 81,088 | 80,393 | 84,142 | 86,921 | ||||||||||||||||||
| TOTAL LIABILITIES AND | ||||||||||||||||||||||||
| STOCKHOLDERS’ EQUITY | $ | 1,195,761 | $ | 1,058,875 | $ | 1,031,998 | $ | 1,012,798 | $ | 989,000 | $ | 979,902 | ||||||||||||
About Center Bancorp
Center Bancorp, Inc. is a financial services holding company and operates Union Center National Bank, its main subsidiary. Chartered in 1923, Union Center National Bank is one of the oldest national banks headquartered in the state of New Jersey and currently the largest commercial bank headquartered in Union County. Its primary market niche is its commercial banking business. The Bank focuses its lending activities on commercial lending to small and medium sized businesses, real estate developers and high net worth individuals.
The Bank, through its Private Wealth Management Division which includes its wholly owned subsidiary, Center Financial Group LLC, and through a strategic partnership with American Economic Planning Group, provides financial services, including brokerage services, insurance and annuities, mutual funds, financial planning, estate and tax planning, trust, elder care and benefit plan administration. Center additionally offers title insurance services in connection with the closing of real estate transactions, through two subsidiaries, Union Title Company and Center Title Company.
The Bank currently operates 13 banking locations in Union and Morris counties in New Jersey. Banking centers are located in Union Township (6 locations), Berkeley Heights, Boonton/Mountain Lakes, Madison, Millburn/Vauxhall, Morristown, Springfield, and Summit, New Jersey. The Bank also operates remote ATM locations in the Chatham and Madison New Jersey Transit train stations, and the Boys and Girls Club of Union.
While the Bank’s primary market area is comprised of Morris and Union Counties, New Jersey, the Corporation has expanded to northern and central New Jersey. At June 30, 2009, the Bank had total assets of $1.3 billion, total deposit funding sources, which includes overnight repurchase agreements, of $979.3 million and stockholders’ equity of $89.5 million. For further information regarding Center Bancorp, Inc., call 1-(800)-862-3683. For information regarding Union Center National Bank, visit our web site at http://www.centerbancorp.com
Non-GAAP Financial Measures
“Return on average tangible stockholders’ equity” is a non-GAAP financial measure and is defined as net income as a percentage of tangible stockholders’ equity. This measure may be important to investors that are interested in analyzing our return on equity exclusive of the effect of changes in intangible assets on equity. The following table presents a reconciliation of return on average stockholders’ equity and return on average tangible stockholders’ equity for the periods presented:
| (Dollars in thousands) | ||||||||||||||||||||||||
| For the quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Net income | $ | 1,201 | $ | 799 | $ | 1,699 | $ | 1,518 | $ | 1,408 | $ | 1,217 | ||||||||||||
| Average stockholders’ equity | $ | 89,805 | $ | 90,899 | $ | 81,088 | $ | 80,393 | $ | 84,142 | $ | 86,921 | ||||||||||||
| Less: Average goodwill and other intangible assets | 17,078 | 17,101 | 17,123 | 17,145 | 17,169 | 17,194 | ||||||||||||||||||
| Average tangible stockholders’ equity | $ | 72,727 | $ | 73,798 | $ | 63,965 | $ | 63,248 | $ | 66,973 | $ | 69,727 | ||||||||||||
| Return on average stockholders’ equity | 5.35 | % | 3.52 | % | 8.38 | % | 7.55 | % | 6.69 | % | 5.60 | % | ||||||||||||
| Add: Average goodwill and other intangible assets | 1.26 | 0.81 | 2.24 | 2.05 | 1.72 | 1.38 | ||||||||||||||||||
| Return on average tangible stockholders’ equity | 6.61 | % | 4.33 | % | 10.62 | % | 9.60 | % | 8.41 | % | 6.98 | % | ||||||||||||
“Tangible book value per common share” is also a non-GAAP financial measure and represents tangible stockholders’ equity (or tangible book value) calculated on a per common share basis. The Corporation believes that a disclosure of tangible book value per common share may be helpful for those investors who seek to evaluate the Corporation’s book value per common share without giving effect to goodwill and other intangible assets. The following table presents a reconciliation of total book value per common share to tangible book value per common share as of the dates presented:
| (Dollars in thousands) | ||||||||||||||||||||||||
| At quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Common shares outstanding | 13,000,601 | 12,991,312 | 12,991,312 | 12,988,284 | 13,016,075 | 13,113,760 | ||||||||||||||||||
| Stockholders’ equity | $ | 89,458 | $ | 89,429 | $ | 81,713 | $ | 80,624 | $ | 80,393 | $ | 85,401 | ||||||||||||
| Less: Preferred stock | 9,578 | 9,557 | - | - | - | - | ||||||||||||||||||
| Less: Goodwill and other intangible assets | 17,066 | 17,087 | 17,110 | 17,132 | 17,154 | 17,179 | ||||||||||||||||||
| Tangible common stockholders’ equity | $ | 62,814 | $ | 62,785 | $ | 64,603 | $ | 63,492 | $ | 63,239 | $ | 68,222 | ||||||||||||
| Book value per common share | $ | 6.14 | $ | 6.15 | $ | 6.29 | $ | 6.21 | $ | 6.18 | $ | 6.51 | ||||||||||||
| Less: Goodwill and other intangible assets | 1.31 | 1.32 | 1.32 | 1.32 | 1.32 | 1.31 | ||||||||||||||||||
| Tangible book value per common share | $ | 4.83 | $ | 4.83 | $ | 4.97 | $ | 4.89 | $ | 4.86 | $ | 5.20 | ||||||||||||
"Tangible common stockholders' equity/tangible assets" is a non-GAAP financial measure and is defined as tangible common stockholders' equity as a percentage of total assets minus goodwill and other intangible assets. This measure may be important to investors that are interested in analyzing the financial condition of the Corporation without consideration for intangible assets, inasmuch as tangible common stockholders' equity and tangible assets both back out goodwill and other intangible assets. The following table presents a reconciliation of total assets to tangible assets and then presents a reconciliation of total stockholders' equity/total assets to tangible common stockholders' equity/tangible assets as of the dates presented:
| (Dollars in thousands) | ||||||||||||||||||||||||
| At quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Total assets | $ | 1,341,603 | $ | 1,121,013 | $ | 1,023,293 | $ | 1,042,778 | $ | 986,436 | $ | 995,167 | ||||||||||||
| Less: Goodwill and other intangible assets | 17,066 | 17,087 | 17,110 | 17,132 | 17,154 | 17,179 | ||||||||||||||||||
| Tangible assets | $ | 1,324,537 | $ | 1,103,926 | $ | 1,006,183 | $ | 1,025,646 | $ | 969,282 | $ | 977,988 | ||||||||||||
| Total stockholders' equity/total assets | 6.67 | % | 7.98 | % | 7.99 | % | 7.73 | % | 8.15 | % | 8.58 | % | ||||||||||||
| Tangible common stockholders' equity/tangible assets | 4.74 | % | 5.69 | % | 6.42 | % | 6.19 | % | 6.52 | % | 6.98 | % | ||||||||||||
Total non-interest income is presented both including and excluding net securities gains (losses). We believe that many investors desire to evaluate non-interest income without regard for securities transactions. The following table presents a reconciliation of total non-interest (or other) income with total non-interest (or other) income excluding the impact of securities transactions.
| (Dollars in thousands) | ||||||||||||||||||||||||
| For the quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Total non-interest income | $ | 2,551 | $ | 1,384 | $ | 615 | $ | 47 | $ | 1,116 | $ | 866 | ||||||||||||
| Net securities gains (losses) | 1,710 | 600 | (256 | ) | (1,075 | ) | 225 | - | ||||||||||||||||
| Total non-interest income, excluding net securities gains (losses) | $ | 841 | $ | 784 | $ | 871 | $ | 1,122 | $ | 891 | $ | 866 | ||||||||||||
“Efficiency ratio” is a non-GAAP financial measure and is defined as non-interest expense as a percentage of net interest income on a tax equivalent basis plus non-interest income, excluding net securities gains (losses), as follows:
| (Dollars in thousands) | ||||||||||||||||||||||||
| For the quarter ended: | 6/30/09 | 3/31/09 | 12/31/08 | 9/30/08 | 6/30/08 | 3/31/08 | ||||||||||||||||||
| Other expense | $ | 7,314 | $ | 5,319 | $ | 4,754 | $ | 4,578 | $ | 5,188 | $ | 4,953 | ||||||||||||
| Net interest income (tax equivalent basis) | $ | 6,753 | $ | 6,556 | $ | 7,086 | $ | 7,148 | $ | 6,776 | $ | 6,117 | ||||||||||||
| Other income, excluding net securities gains (losses) | 841 | 784 | 871 | 1,122 | 891 | 866 | ||||||||||||||||||
| $ | 7,594 | $ | 7,340 | $ | 7,957 | $ | 8,270 | $ | 7,667 | $ | 6,983 | |||||||||||||
| Efficiency ratio | 96.3 | % | 72.5 | % | 59.7 | % | 55.4 | % | 67.7 | % | 70.9 | % | ||||||||||||
Forward-Looking Statements
All non-historical statements in this press release (including statements regarding market trends, management’s focus, the timing of a sale of an OREO property, the timing of funding of undisbursed commitments and the continuing ability to attract deposits) constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may use such forward-looking terminology such as "expect," "look," "believe," "plan," "anticipate," "may," "will" or similar statements or variations of such terms or otherwise express views concerning trends and the future. Such forward-looking statements involve certain risks and uncertainties. These include, but are not limited to, the direction of interest rates, continued levels of loan quality and origination volume, continued relationships with major customers including sources for loans, as well as the effects of international, national, regional and local economic conditions and legal and regulatory barriers and structure, including those relating to the current global financial crisis and the deregulation of the financial services industry, and other risks cited in reports filed by the Corporation with the Securities and Exchange Commission. Actual results may differ materially from such forward-looking statements. Center Bancorp, Inc. assumes no obligation for updating any such forward-looking statement at any time.
Investor Inquiries:
Anthony C. Weagley
President & Chief Executive Officer
(908) 206-2886
Joseph Gangemi
Investor Relations
(908) 206-2886
CENTER BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CONDITION
(unaudited)
| (Dollars in Thousands, Except Per Share Data) | June 30, 2009 | December 31, 2008 | |||||
| ASSETS | |||||||
| Cash and due from banks | $ | 176,784 | $ | 15,031 | |||
| Investment securities available-for sale | 378,895 | 242,714 | |||||
| Loans | 694,214 | 676,203 | |||||
| Less — Allowance for loan losses | 6,917 | 6,254 | |||||
| Net loans | 687,297 | 669,949 | |||||
| Restricted investment in bank stocks, at cost | 10,675 | 10,230 | |||||
| Premises and equipment, net | 18,430 | 18,488 | |||||
| Accrued interest receivable | 4,671 | 4,154 | |||||
| Bank owned life insurance | 25,888 | 22,938 | |||||
| Other real estate owned | 3,500 | 3,949 | |||||
| Goodwill and other intangible assets | 17,066 | 17,110 | |||||
| Other assets | 18,397 | 18,730 | |||||
| Total assets | $ | 1,341,603 | $ | 1,023,293 | |||
| LIABILITIES | |||||||
| Deposits: | |||||||
| Non-interest bearing | $ | 130,115 | $ | 113,319 | |||
| Interest-bearing | |||||||
| Time deposits $100 and over | 269,770 | 100,493 | |||||
| Interest-bearing transactions, savings and time deposits $100 and less | 555,257 | 445,725 | |||||
| Total deposits | 955,142 | 659,537 | |||||
| Short-term borrowings | 24,122 | 45,143 | |||||
| Long-term borrowings | 223,221 | 223,297 | |||||
| Subordinated debentures | 5,155 | 5,155 | |||||
| Accounts payable and accrued liabilities | 8,659 | 8,448 | |||||
| Due to brokers for investment securities | 35,846 | — | |||||
| Total liabilities | 1,252,145 | 941,580 | |||||
| STOCKHOLDERS’ EQUITY | |||||||
| Preferred stock, $1,000 liquidation value per share: | |||||||
| Authorized 5,000,000 shares; issued 10,000 shares in 2009 and none in 2008 | 9,578 | — | |||||
| Common stock, no par value: | |||||||
| Authorized 20,000,000 shares; issued 15,190,984 shares in 2009 and 2008; outstanding 13,000,601 in 2009 and 12,991,312 shares in 2008 | 86,908 | 86,908 | |||||
| Additional paid in capital | 5,636 | 5,204 | |||||
| Retained earnings | 16,458 | 16,309 | |||||
| Treasury stock, at cost (2,190,383 in 2009 and 2,199,672 shares in 2008) | (17,720 | ) | (17,796 | ) | |||
| Accumulated other comprehensive loss | (11,402 | ) | (8,912 | ) | |||
| Total stockholders’ equity | 89,458 | 81,713 | |||||
| Total liabilities and stockholders’ equity | $ | 1,341,603 | $ | 1,023,293 | |||
CENTER BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
((Dollars in Thousands, Except Per Share Data) | 2009 | 2008 | 2009 | 2008 | ||||||||||||
| Interest income: | ||||||||||||||||
| Interest and fees on loans | $ | 9,211 | $ | 8,677 | $ | 18,313 | $ | 17,148 | ||||||||
| Interest and dividends on investment securities: | ||||||||||||||||
| Taxable interest income | 3,079 | 2,635 | 5,459 | 5,400 | ||||||||||||
| Non-taxable interest income | 245 | 675 | 588 | 1,477 | ||||||||||||
| Dividends | 171 | 213 | 288 | 456 | ||||||||||||
Interest on Federal funds sold and securities purchased under agreement to resell | — | 30 | — | 109 | ||||||||||||
| Total interest income | 12,706 | 12,230 | 24,648 | 24,590 | ||||||||||||
| Interest expense: | ||||||||||||||||
| Interest on certificates of deposit $100 or more | 989 | 537 | 1,767 | 1,212 | ||||||||||||
| Interest on other deposits | 2,552 | 2,499 | 4,829 | 5,868 | ||||||||||||
| Interest on borrowings | 2,538 | 2,765 | 5,046 | 5,394 | ||||||||||||
| Total interest expense | 6,079 | 5,801 | 11,642 | 12,474 | ||||||||||||
| Net interest income | 6,627 | 6,429 | 13,006 | 12,116 | ||||||||||||
| Provision for loan losses | 156 | 521 | 1,577 | 671 | ||||||||||||
| Net interest income after provision for loan losses | 6,471 | 5,908 | 11,429 | 11,445 | ||||||||||||
| Other income: | ||||||||||||||||
| Service charges, commissions and fees | 440 | 513 | 889 | 1,042 | ||||||||||||
| Annuity and insurance | 45 | 38 | 85 | 55 | ||||||||||||
| Bank owned life insurance | 257 | 227 | 475 | 449 | ||||||||||||
| Net securities gains | 1,710 | 225 | 2,310 | 225 | ||||||||||||
| Other | 99 | 113 | 176 | 211 | ||||||||||||
| Total other income | 2,551 | 1,116 | 3,935 | 1,982 | ||||||||||||
Other expense: | ||||||||||||||||
| Salaries and employee benefits | 2,507 | 2,524 | 4,900 | 4,876 | ||||||||||||
| Occupancy, net | 583 | 734 | 1,380 | 1,493 | ||||||||||||
| Premises and equipment | 319 | 356 | 640 | 722 | ||||||||||||
| FDIC insurance | 940 | 20 | 1,305 | 40 | ||||||||||||
| Professional and consulting | 236 | 190 | 448 | 362 | ||||||||||||
| Stationery and printing | 102 | 118 | 172 | 213 | ||||||||||||
| Marketing and advertising | 141 | 188 | 271 | 348 | ||||||||||||
| Computer expense | 228 | 226 | 442 | 367 | ||||||||||||
| OREO expense, net | 1,375 | 31 | 1,408 | 64 | ||||||||||||
| Other | 883 | 801 | 1,667 | 1,656 | ||||||||||||
| Total other expense | 7,314 | 5,188 | 12,633 | 10,141 | ||||||||||||
| Income before income tax expense | 1,708 | 1,836 | 2,731 | 3,286 | ||||||||||||
| Income tax expense | 507 | 428 | 731 | 661 | ||||||||||||
| Net income | 1,201 | 1,408 | 2,000 | 2,625 | ||||||||||||
| Preferred stock dividends and accretion | 148 | — | 277 | — | ||||||||||||
| Net income available to common stockholders | $ | 1,053 | $ | 1,408 | $ | 1,723 | $ | 2,625 | ||||||||
Earnings per common share: | ||||||||||||||||
| Basic | $ | 0.08 | $ | 0.11 | $ | 0.13 | $ | 0.20 | ||||||||
| Diluted | $ | 0.08 | $ | 0.11 | $ | 0.13 | $ | 0.20 | ||||||||
Weighted average common shares outstanding: | ||||||||||||||||
| Basic | 12,994,429 | 13,070,868 | 12,992,879 | 13,107,808 | ||||||||||||
| Diluted | 12,996,544 | 13,083,558 | 12,994,518 | 13,123,136 | ||||||||||||
SUMMARY SELECTED QUARTERLY STATISTICAL INFORMATION AND FINANCIAL DATA
(Dollars in Thousands, Except per Share Data)
| Three Months Ended | ||||||||||||
| 6/30/2009 | 3/31/2009 | 6/30/2008 | ||||||||||
| Statements of Income Data: | ||||||||||||
| Interest income | $ | 12,706 | $ | 11,942 | $ | 12,230 | ||||||
| Interest expense | 6,079 | 5,563 | 5,801 | |||||||||
| Net interest income | 6,627 | 6,379 | 6,429 | |||||||||
| Provision for loan losses | 156 | 1,421 | 521 | |||||||||
| Net interest income after provision for loan losses | 6,471 | 4,958 | 5,908 | |||||||||
| Other income | 2,551 | 1,384 | 1,116 | |||||||||
| Other expense | 7,314 | 5,319 | 5,188 | |||||||||
| Income before income tax expense | 1,708 | 1,023 | 1,836 | |||||||||
| Income tax expense | 507 | 224 | 428 | |||||||||
| Net income | 1,201 | 799 | 1,408 | |||||||||
| Net income available to common stockholders | $ | 1,053 | $ | 670 | $ | 1,408 | ||||||
| Earnings per common share: | ||||||||||||
| Basic | $ | 0.08 | $ | 0.05 | $ | 0.11 | ||||||
| Diluted | $ | 0.08 | $ | 0.05 | $ | 0.11 | ||||||
| Statements of Condition Data (Period End): | ||||||||||||
| Investments | $ | 378,895 | $ | 266,032 | $ | 253,780 | ||||||
| Total loans | 694,214 | 678,017 | 631,221 | |||||||||
| Goodwill and other intangibles | 17,066 | 17,087 | 17,154 | |||||||||
| Total assets | 1,341,603 | 1,121,013 | 986,436 | |||||||||
| Deposits | 955,142 | 768,379 | 621,190 | |||||||||
| Borrowings | 252,498 | 255,365 | 279,585 | |||||||||
| Stockholders' equity | $ | 89,458 | $ | 89,429 | $ | 80,393 | ||||||
| Dividend Data on Common Shares: | ||||||||||||
| Cash dividends | $ | 390 | $ | 1,169 | $ | 1,177 | ||||||
| Dividend payout ratio | 37.04 | % | 174.48 | % | 83.59 | % | ||||||
| Cash dividends per share | $ | 0.03 | $ | 0.09 | $ | 0.09 | ||||||
| Weighted Average Common Shares Outstanding: | ||||||||||||
| Basic | 12,994,429 | 12,991,312 | 13,070,868 | |||||||||
| Diluted | 12,996,544 | 12,993,185 | 13,083,558 | |||||||||
| Operating Ratios: | ||||||||||||
| Return on average assets | 0.40 | % | 0.30 | % | 0.57 | % | ||||||
| Average stockholders' equity to average assets | 7.51 | % | 8.58 | % | 8.51 | % | ||||||
| Return on average equity | 5.35 | % | 3.52 | % | 6.69 | % | ||||||
| Return on average tangible stockholders’ equity | 6.61 | % | 4.33 | % | 8.41 | % | ||||||
| Book value per common share | $ | 6.14 | $ | 6.15 | $ | 6.18 | ||||||
| Tangible book value per common share | $ | 4.83 | $ | 4.83 | $ | 4.86 | ||||||
| Non-Financial Information (Period End): | ||||||||||||
| Common stockholders of record | 627 | 633 | 658 | |||||||||
| Staff-full time equivalent | 155 | 160 | 164 | |||||||||