updated 4/20/2011 11:16:27 AM ET 2011-04-20T15:16:27

FREEHOLD, N.J., April 20, 2011 (GLOBE NEWSWIRE) -- New Jersey Community Bank (OTCBB:NJCB) (the "Bank") reported net income of $142 thousand, or $0.09 per common share for the three months ended March 31, 2011, compared with a net loss of $112 thousand, or $0.07 per common share, for the same period in the prior year.

Robert D. O'Donnell, Chairman and CEO, commented that, "Our first quarter 2011 earnings, net interest margin and asset quality remains resilient throughout this unsettled economic environment. However, with the signs of modest recovery, we are cautiously optimistic that we will remain profitable as we navigate through year 2011."

James A. Kinghorn, President and COO, noted that, "During the quarter, we continued to wrestle with prolonged low level of interest rates and intense competition for new loans. Despite these challenges, we were able to report improved operating results year over year. Though the new loan demand has softened but our "approved but unfunded" loan pipeline remains healthy and credit metrics are strong. Our emphasis will continue to be on lending, focusing primarily on commercial mortgage, construction and business loan sectors."

Balance Sheet Summary

At March 31, 2011, total assets were $122.9 million, an increase of $10.3 million, or 9.2%, over $112.6 million reported at December 31, 2010, primarily as a result of increases in total cash and cash equivalents and loans receivable, partially offset by a slight decrease in due from banks time deposits. Total cash and cash equivalents increased $8.8 million, or 122.6%, to $16.0 million at March 31, 2011, from $7.2 million at December 31, 2010, primarily due to increase in total deposits.

Investment securities were almost unchanged at March 31, 2011 when compared to December 31, 2010. Total loans receivable increased $3.0 million, or 3.6%, to $87.7 million at March 31, 2011, from $84.7 million reported at December 31, 2010. The increase in loans receivable was funded utilizing the liquidity arising from the growth in deposits.

Total deposits grew by $10.1 million, or 10.3%, to $108.0 million during the first quarter of year 2011. Of the total increase, time deposits increased $9.8 million or 97.0%, while non-interest bearing, savings, NOW and money market deposits combined increased $0.3 million, or 3.0%. Shareholders' equity totaled $14.7 million as of March 31, 2011. The Bank's capital ratios exceed the regulatory requirements of a well capitalized financial institution.

Results of Operations

For the quarter ended March 31, 2011, net interest income totaled $1.1 million, increasing $430 thousand over the same period in the prior year. The increase in net interest income was primarily due to a combination of both a $23.4 million increase in average earning assets coupled with 51 basis points increase in average yield on earning assets.  During the first quarter, interest bearing liabilities increased $21.3 million; while the yield on the interest bearing liabilities declined 49 basis points. Net interest margin improved to 4.04% for the quarter ended March 31, 2011, an increase of 95 basis points over the comparable quarter in 2010.

The provision for loan loss was $95 thousand for the first quarter 2011, a decrease of $18 thousand compared to a year-ago quarter. The allowance for loan loss at period-end was $1.1 million, or 1.22% of total loans. Mr. Kinghorn 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 increased moderately to $94 thousand for the quarter ended March 31, 2011 compared with $91 thousand for the same quarter in the prior year. Majority of such increase is directly related to the increase in fees and service charges on deposit accounts.

Non-interest expense totaled $849 thousand for the quarter ended March 31, 2011, an increase of $92 thousand from year-ago quarter, primarily due to the growth of the bank.  Of the total increase, salaries and employee benefits increased $41 thousand, professional fees increased $19 thousand and all other expenses combined increased $30 thousand.

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 two full-service banking offices in the central New Jersey county of Monmouth. 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.

The New Jersey Community Bank logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=7748

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) 3/31/2011 12/31/2010 9/30/2010 6/30/2010 3/31/2010
           
Summary of Operations:          
Interest income  $ 1,439  $ 1,383  $ 1,294  $ 1,177  $ 1,022
Interest expense  335  355  388  364  349
Net interest income  1,104  1,027  906  813  673
 Provision for loan loss  95  141  115  103  113
Net interest income after provision for loan loss  1,009  886  791  710  560
 Non-interest income  94  124  101  96  91
 Non-interest expense  849  864  790  790  763
Income before income tax (benefit) expense  254  147  101  16  (112)
Income tax (benefit) expense  112  (1,190)  --  5  --
 Net income (loss)  $ 142  $ 1,337  $ 101  $ 11  $ (112)
           
Earnings (loss) per share:          
 Basic  $ 0.09  $ 0.81  $ 0.06  $ 0.01  $ (0.07)
 Diluted  0.09  0.81  0.06  0.01  (0.07)
 Book value per share  8.94  8.83  8.05  7.95  7.90
Average shares outstanding  1,649  1,649  1,649  1,649  1,649
Average diluted shares outstanding  1,649  1,649  1,649  1,649  1,649
           
Selected Financial Ratios:          
Return on average assets 0.49% 4.89% 0.37% 0.04% -0.49%
Return on average common equity 3.86% 39.99% 3.07% 0.34% -3.41%
Average equity to average assets 12.74% 12.23% 11.99% 13.00% 14.40%
Risk-based capital:          
Total risk-based capital ratio 15.80% 15.65% 16.14% 17.04% 18.24%
Tier 1 risk-based capital ratio 14.68% 14.61% 15.10% 15.97% 17.22%
Tier 1 leverage capital ratio 12.19% 12.69% 12.02% 13.04% 14.32%
           
Financial Condition:          
 Total assets  $ 122,898  $ 112,565  $ 112,173  $ 105,244  $ 94,210
 Loans, net of unearned income  87,713  84,693  78,600  73,534  68,421
 Deposits  107,984  97,855  98,730  91,938  81,085
 Shareholder's equity  14,738  14,554  13,267  13,114  13,034
 
New Jersey Community Bank
Statements of Financial Condition
(dollars in thousands)
     
  March 31, December 31,
  2011 2010
Assets (unaudited)  
Cash and due from banks - non-interest bearing  $ 1,090  $ 1,341
Federal funds sold and interest-bearing deposits with banks  14,948  5,865
Total Cash and Cash Equivalents  16,038  7,206
Due from banks - time deposits  3,421  4,659
Investment Securities:    
Available-for-sale  11,385  11,381
Held-to-maturity  1,221  1,220
Total Investment Securities  12,606  12,601
Loans Receivable, net of unearned income  87,713  84,693
Less: Allowance for loan losses  (1,070)  (975)
Net Loans  86,643  83,718
Premises and equipment, net  2,488  2,534
Accrued interest receivable  303  304
Deferred tax assets  1,078  1,190
Other assets  321  353
Total Assets  $ 122,898  $ 112,565
     
Liabilities and Shareholders' Equity    
     
Liabilities    
Deposits:    
Non-interest bearing  $ 5,888  $ 5,709
Savings, NOW and money market  29,874  29,740
Time deposits $100M and over  49,653  41,110
Time deposits, other  22,569  21,296
Total Deposits  107,984  97,855
     
Accrued interest payable  9  12
Other liabilities  167  144
Total Liabilities  108,160  98,011
     
Shareholders' Equity    
Common stock, $2 par value; authorized 10,000,000 shares;    
issued and outstanding 1,648,783 shares  3,298  3,298
Surplus  13,562  13,519
Accumulated Deficit  (2,059)  (2,201)
Accumulated other comprehensive (loss) income  (63)  (62)
Total Shareholders' Equity  14,738  14,554
Total Liabilities and Shareholders' Equity  $ 122,898  $ 112,565
 
New Jersey Community Bank
Statements of Operations
(in thousands, except per share data)
     
  Three Months Ended
  March 31,
  2011 2010
Interest Income (unaudited)
Loans receivable, including fees  $ 1,350  $ 962
Investment securities  77  47
Federal funds sold and interest-bearing deposits with banks  3  7
Due from banks - interest bearing  9  6
Total Interest Income  1,439  1,022
Interest Expense    
Deposits  335  349
     
Total Interest Expense  335  349
Net Interest Income before Provision for Loan Loss  1,104  673
Provision for Loan Loss  95  113
Net Interest Income after Provision for Loan Loss  1,009  561
Non-Interest Income    
Fees and service charges on deposit accounts  81  78
Loan fee income  5  4
All other income  8  9
Total Non-Interest Income  94  91
Non-Interest Expense    
Salaries and employee benefits  488  446
Occupancy and equipment  156  148
Data processing services  31  26
Professional and other fees  57  38
Advertising and promotion  9  1
Federal insurance assessment  43  30
Other operating expenses  65  74
Total Non-Interest Expenses  849  763
Income (Loss) Before Income Tax Benefit  254  (112)
Income tax expense  112  --
Net Income (Loss)  $ 142  $ (112)
Income (Loss) per share:    
Basic and diluted  $ 0.09  $ (0.07)
Weighted average number of common shares outstanding    
Basic and diluted  1,649  1,649
CONTACT: New Jersey Community Bank:
         Robert D. O'Donnell
         Chairman and CEO
         rodonnell@njcbk.com
         
         James A. Kinghorn
         President and COO
         jkinghorn@njcbk.com
         
         Naqi A. Naqvi
         SVP & CFO
         nnaqvi@njcbk.com

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