FREEHOLD, NJ — (Marketwired) — 04/17/13 — New Jersey Community Bank (OTCQB: NJCB) (the “Bank”) reported net income of $90 thousand, or $0.05 per common share for the three months ended March 31, 2013, compared with a net income of $108 thousand, or $0.06 per common share, for the same period in the prior year. Although the net interest income increased $34 thousand year over year but it was more than offset by an increase of $56 thousand in total non-interest expense. Net interest margin increased 14 basis points year over year largely due to a decline of 29 basis points in cost of interest-bearing liabilities.
Robert D. O-Donnell, Chairman and CEO, commented that, “We are pleased with the first quarter 2013 results during this continued market volatility and depressed interest rates. Recent months have brought some encouraging news on the employment and market fronts but the banking industry continues to reflect the impact of prolonged low interest rates. Our first quarter results reflect a decline in total assets which was driven primarily by our business decision to reduce the excess cash levels by paying off certain deposits that matured during the first quarter 2013. Though the new loan demand has softened, we continue to seek lending opportunities while focusing on safe and sound lending practices.”
At March 31, 2013, total assets were $130.9 million, a decline of $7.8 million from December 31, 2012. Total cash and cash equivalents declined $7.8 million compared to year end 2012, offsetting a similar decline in total deposits. Investment securities increased $1.4 million while loans receivable decreased $1.4 million compared to year end 2012. The decrease in loans receivables was a result of payoff of few loans and ongoing scheduled principal payments.
Total deposits decreased $7.9 million compared to the levels at year end 2012. Majority of the decrease resulted from the maturing time deposits which were paid off utilizing the excess levels of cash and cash equivalents during the first quarter of 2013. During the quarter, savings, NOW and money market deposits combined increased $1.5 million while non-interest bearing deposits declined by the same amount.
Shareholders- equity totaled $15.8 million at March 31, 2013, increasing moderately from year-end 2012. The Bank-s capital ratios remain strong and exceed the regulatory requirements to be deemed a well capitalized financial institution.
For the quarter ended March 31, 2013, net interest income totaled $1.1 million, increasing marginally over the same period in the prior year. At March 31, 2013, net interest margin was 3.56%, an improvement of 14 basis points compared to the same period a year ago resulting from a decrease in cost of interest-bearing deposits. At March 31, 2013, yield on average earning assets declined 12 basis points to 4.39% while the cost of interest-bearing deposits declined 29 basis points to 0.97%, compared to the same period in the prior year primarily due to low interest rates.
The provision for loan loss was $35 thousand for the first quarter 2013, a decrease of $10 thousand compared to a year-ago quarter. The allowance for loan loss at period-end was $1.2 million, or 1.36% of total loans. Asset quality remains resilient and the current level of the allowance for loan loss is considered to be adequate.
Non-interest income decreased $17 thousand to $86 thousand for the quarter ended March 31, 2013, compared with $103 thousand for the same quarter in the prior year. Majority of such decrease is directly related to the decrease in fees and service charges on deposit accounts offset by an increase of $14 thousand in all other income.
Non-interest expense totaled $1.0 million for the quarter ended March 31, 2013, an increase of $56 thousand, from a year-ago quarter. Of the total increase in non-interest expense, salaries and employee benefits increased $29 thousand as a result of increases in health costs and professional and other fees increased $21 thousand due to increase in cost of professional services utilized by the Bank.
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 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.
Contacts at New Jersey Community Bank:
Robert D. O-Donnell
Chairman and CEO
Terry H. Thompson
President and COO
Naqi A. Naqvi
Executive Vice President & CFO