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BCB Bancorp Inc. Reports Operating Results (10-K)
Posted by: gurufocus (IP Logged)
Date: March 31, 2012 01:24PM

BCB Bancorp Inc. (BCBP) filed Annual Report for the period ended 2011-12-31. Bcb Bancorp Inc has a market cap of $96.1 million; its shares were traded at around $10 with a P/E ratio of 16.6 and P/S ratio of 1.8. The dividend yield of Bcb Bancorp Inc stocks is 4.9%. Bcb Bancorp Inc had an annual average earning growth of 1.9% over the past 5 years.



Highlight of Business Operations:

Management uses its best judgment in estimating fair value measurements of the Company’s financial instruments; however, there are inherent weaknesses in any estimation technique. Management utilized various inputs to determine fair value including but not limited to the use of, valuation techniques based on various assumptions, including, but not limited to cash flows, discount rates, rate of return, adjustments for nonperformance and liquidity, quoted market prices, and appraisals. Therefore, for substantially all financial instruments, the fair value estimates herein are not necessarily indicative of the amounts the Company could have realized in a sales transaction on the dates indicated. The estimated fair value amounts have been measured as of their respective year-ends and have not been re-evaluated or updated for purposes of these consolidated financial statements subsequent to those respective dates. As such, the estimated fair values of these financial instruments subsequent to the respective reporting dates may be different than the amounts reported at each year-end.

Net interest income is the difference between interest income on interest-earning assets and interest expense on interest-bearing liabilities. Net interest income depends on the relative amounts of interest-earning assets and interest-bearing liabilities and the interest rates earned or paid on them, respectively.

The increase in non-interest income resulted primarily from the gain on bargain purchase associated with the completion of the acquisition of Pamrapo Bancorp, Inc. of $12.6 million for the year ended December 31, 2010 as compared to no such corresponding gain for the year ended December 31, 2009. A bargain purchase is defined as a business combination in which the total acquisition-date fair value of the identifiable net assets acquired exceeds the fair value of the consideration transferred plus any non-controlling interest in the acquire, and it requires the acquirer to recognize that excess in earnings as a gain attributable to the acquisition.

Interest income on other interest-earning assets consisting primarily of interest earning demand deposits increased by $70,000 or 148.9% to $117,000 for the year ended December 31, 2010 from $47,000 for the year ended December 31, 2009. This increase was primarily due to an increase in the average balance of other interest earning assets of $60.0 million or 126.6% to $107.4 million for the year ended December 31, 2010 from $47.4 million for the year ended December 31, 2009. The average yield on other interest-earning assets remained relatively stable at 0.11% for the year ended December 31, 2010 as compared to 0.10% for the year ended December 31, 2009. The increase in the average balance of other interest earning assets is primarily attributable to the completion of the acquisition of Pamrapo Bancorp, Inc. The static nature of the average yield on other interest earning assets reflects the current philosophy by the FOMC of keeping short term interest rates at historically low levels for the last two years.

Total non-interest income increased by $12.9 million to $13.86 million for the year ended December 31, 2010 from $931,000 for the year ended December 31, 2009. The increase in non-interest income resulted primarily from the gain on bargain purchase associated with the completion of the acquisition of Pamrapo Bancorp, Inc. of $12.6 million for the year ended December 31, 2010 from no such corresponding gain for the year ended December 31, 2009. A bargain purchase is defined as a business combination in which the total acquisition-date fair value of the identifiable net assets acquired exceeds the fair value of the consideration transferred plus any non-controlling interest in the acquire, and it requires the acquirer to recognize that excess in earnings as a gain attributable to the acquisition. The increase in non-interest income also reflects a $250,000 increase in fees and service charges to $907,000 for the year ended December 31, 2010 from $657,000 for the year ended December 31, 2009. Gain on sales of loans originated for sale increased by $70,000 or 31.1% to $295,000 for the year ended December 31, 2010 from $225,000 for the year ended December 31, 2009. The increase in gain on sale of loans originated for sale occurred primarily as a result of the active local market for refinancing one-to four-family residential mortgages, aided in large part by the low interest rate environment. Other income increased by $387,000 to $423,000 for the year ended December 31, 2010 from $36,000 for the year ended December 31, 2009. This increase occurred primarily as a result of a $237,500 litigation settlement with the Bayonne Medical Center, a $50,000 recovery from a previous charge-off regarding a check kiting incident and a $67,000 recovery received through litigation on a real estate facility where insurance proceeds were improperly retained by a third party. The aforementioned increases were partially offset by a loss on sale of real estate of $345,000 for the year ended December 31, 2010 compared to a gain of $13,000 for the year ended December 31, 2009.

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