Exhibit 99.1
FOR IMMEDIATE RELEASE CONTACT: KEITH WINCHESTER
November 3, 2009 856-439-0300
CORNERSTONE FINANCIAL CORPORATION
REPORTS ENHANCED THIRD QUARTER PERFORMANCE AND RETURN TO PROFITABILITY
Moorestown, NJ, November 3, 2009 - Cornerstone Financial Corporation (CFIC.OB),
the holding company for Cornerstone Bank, reported today that net income for the
third quarter of 2009 increased 122.3% over earnings in the prior year's third
quarter, to $269 thousand, or $0.15 per diluted share, as compared to net income
of $121 thousand, or $0.07 per diluted share, for the same period in 2008 and a
loss of $1.1 million, or ($0.66) per share, for the second quarter of 2009. The
Company's net interest margin was 3.49% for the third quarter of 2009,
increasing from 3.45% in the third quarter of 2008 and 3.27% for the second
quarter of 2009.
The improved quarterly performance reflects an increase in total interest income
of $681 thousand over the prior year, to $3.9 million from $3.2 million, and
$256 thousand over the second quarter of 2009. Net interest income increased by
$522 thousand over the year ago period and $359 thousand over the second quarter
of 2009. The increase in net interest income was partially offset by a $131
thousand increase in the provision for loan losses in the current third quarter
compared to the third quarter of 2008. However, the provision declined by $1.7
million compared to the second quarter of 2009.
Total assets at September 30, 2009 were $303.0 million, an increase of $55.5
million or 22.4% over December 31, 2008. This change was primarily due to
increases in net loans receivable of $38.6 million and investments held to
maturity of $17.9 million.
Total deposits at September 30, 2009 were $248.8 million, an increase of $46.8
million or 23.2% from December 31, 2008. The increase in total deposits was
spread among non-interest bearing deposits, with an increase of $10.5 million,
certificates of deposit with an increase of $12.5 million, and a significant
increase in interest bearing core deposits of $23.8 million.
Gross loans receivable at September 30, 2009, totaled $235.1 million, an
increase of $41.0 million or 21.1% from December 31, 2008. This increase was
attributable to increases in commercial loans of $26.6 million, commercial real
estate loans of $14.7 million and construction loans of $666 thousand, partially
offset by decreases in consumer loans of $777 thousand and residential real
estate loans of $132 thousand.
At both September 30, 2009 and June 30, 2009, our total non-performing assets
were $6.1 million. This represented 2.0% of our total assets at September 30,
2009 and 2.1% of our total assets at June 30, 2009. While our non-performing
assets were stable quarter to quarter, they did increase from $281 thousand in
other real estate owned and no non-accrual loans at year end 2008. The
non-performing assets primarily reflect four (4) non-accrual loan relationships
totaling $5.9 million, which were previously reported at June 30, 2009. The
increase in non-performing assets over the course of 2009 reflects the general
economic slowdown in our marketplace coupled with the rise in unemployment
levels.
For the nine month period ended September 30, 2009, Cornerstone Financial
Corporation reported a net loss of $1.0 million, or ($0.61) per share, as
compared to a net loss of $125 thousand, or ($0.08) per share, for the same
period in 2008. The change in net income for the nine-month period reflects an
increase of $1.2 million in net interest income, offset by increases of $2.0
million in provision for loan losses, $274 thousand in special assessment and
regular FDIC insurance premium expense and $420 thousand in increased salary and
benefit costs, net occupancy costs and other operating expenses incurred in
connection with the Bank's expansion, including costs relating to the Bank's
Moorestown Main Street branch, which opened in June 2008.
Cornerstone's Chairman, President, and CEO George W. Matteo, Jr. commented
"Although this past year has been filled with many challenges in our local and
national economy we are extremely pleased with the loan and deposit growth
experienced during the nine month period ended September 30, 2009 and our return
to profitability in the third quarter." Mr. Matteo added: " The improvement in
our third quarter earnings was partially brought about by an improvement in our
net interest margin. We were able to increase our core deposit base and were
able to reprice deposits at much lower costs." Mr. Matteo continued, "We
consider our third quarter earnings performance to be noteworthy especially in
the face of an extremely difficult economic environment and the difficult and
unsettled regulatory environment at both the state and national level for
today's banking industry".
Cornerstone Financial Corporation is a New Jersey based bank holding company
headquartered in Mount Laurel, New Jersey. Cornerstone Bank ("the Bank") is a
New Jersey state chartered commercial bank headquartered in Moorestown, New
Jersey. The Bank commenced operations on October 4, 1999, and conducts business
from its main office in Moorestown and from five additional branch offices
located in Medford, New Jersey, Burlington, New Jersey, Cherry Hill, New Jersey,
Voorhees New Jersey and Mount Laurel, New Jersey.
Set forth below is selected financial information concerning Cornerstone
Financial Corporation:
SELECTED BALANCE SHEET DATA September 30, December 31,
(Unaudited, in thousands) 2009 2008
------------- ------------
Investments held to maturity $ 46,308 $ 28,398
Loans receivable 235,081 194,104
Allowance for loan losses 3,484 1,133
Total assets 303,031 247,535
Deposits 248,820 202,030
Advances from the Federal Home Loan Bank 29,955 26,257
Stockholders equity 15,448 15,378
SELECTED INCOME STATEMENT DATA
THREE MONTHS THREE MONTHS NINE MONTHS NINE MONTHS
ENDED ENDED ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
(Unaudited, in thousands except per share data) 2009 2008 2009 2008
-------------- -------------- ------------- -------------
Interest income $ 3,873 $ 3,192 $ 10,841 $ 9,155
Interest expense 1,502 1,343 4,634 4,170
Net interest income 2,371 1,849 6,207 4,985
Provision for loan losses 131 - 2,351 317
Income (loss) before income taxes 422 159 (1,770) (303)
Net income (loss) 269 121 (1,025 (125)
Earnings per share
Basic $ 0.15 $ 0.07 $ (0.61) $ (0.08)
Diluted $ 0.15 $ 0.07 $ (0.61) $ (0.08)
Weighted average shares outstanding
Basic 1,741 1,656 1,686 1,656
Diluted 1,741 1,656 1,686 1,656
FORWARD-LOOKING STATEMENTS
Cornerstone Financial Corporation (the "Company") may from time to time
make written or oral "forward-looking statements," including statements
contained in the Company's filings with the Securities and Exchange Commission
(including this Quarterly Report on Form 10-Q and the exhibits hereto), in its
reports to shareholders and in other communications by the Company, which are
made in good faith by the Company pursuant to the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995.
These forward-looking statements involve risks and uncertainties, such as
statements of the Company's plans, objectives, expectations, estimates and
intentions that are subject to change based on various important factors (many
of which are beyond the Company's control). Forward-looking statements may be
identified by the use of words such as "expects," "subject," "believe," "will,"
"intends," "will be," or "would." The factors which could cause the Company's
financial performance to differ materially from the plans, objectives,
expectations, estimates and intentions expressed in such forward-looking
statements include those items listed under "Item 1A-Risk Factors" in our Annual
Report on Form 10-K for the year ended December 31, 2008 and the following
factors, among others: the strength of the United States economy in general and
the strength of the local economies in which the Company conducts operations;
the effects of, and changes in, trade, monetary and fiscal policies and laws,
including interest rate policies of the Board of Governors of the Federal
Reserve System ("Federal Reserve"); inflation; interest rates; market and
monetary fluctuations; the timely development of new products and services by
the Company and the perceived overall value of these products and services by
users, including the features, pricing and quality compared to competitors'
products and services; the success of the Company in gaining regulatory approval
of its products, services, dividends and of new branches, when required; the
impact of changes in financial services laws and regulations (including laws
concerning taxes, banking, securities and insurance); technological changes;
acquisitions; the ability to continue to effectively manage costs, including the
costs incurred in connection with the opening of new branches; changes in
consumer spending and saving habits; and the success of the Company at managing
the risks resulting from these factors.