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BCB Bancorp Inc. Reports Operating Results (10-Q)

August 16, 2010 | About:
10qk

10qk

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BCB Bancorp Inc. (BCBP) filed Quarterly Report for the period ended 2010-06-30.

Bcb Bancorp Inc. has a market cap of $40.11 million; its shares were traded at around $8.6 with a P/E ratio of 10.36 and P/S ratio of 1.14. The dividend yield of Bcb Bancorp Inc. stocks is 5.58%. Bcb Bancorp Inc. had an annual average earning growth of 7.3% over the past 5 years.

Highlight of Business Operations:

Net income increased by $290,000 or 45.9% to $922,000 for the three months ended June 30, 2010 from $632,000 for the three months ended June 30, 2009. The increase in net income was due to increases in net interest income and non-interest income and a decrease in non-interest expense, partially offset by an increase in income taxes. Net interest income increased by $355,000 or 8.2% to $4.69 million for the three months ended June 30, 2010 from $4.34 million for the three months ended June 30, 2009. This increase in net interest income resulted primarily from an increase of $29.1 million or 4.9% in the average balance of interest earning assets to $628.6 million for the three months ended June 30, 2010 from $599.5 million for the three months ended June 30, 2009, partially offset by a decrease in the yield on interest earning assets to 4.91% for the three months ended June 30, 2010 from 5.50% for the three months ended June 30, 2009. The average balance of interest bearing liabilities increased by $26.9 million or 5.1% to $552.4 million for the three months ended June 30, 2010 from $525.5 million for the three months ended June 30, 2009 and the average cost of interest bearing liabilities decreased by seventy-eight basis points to 2.19% for the three months ended June 30, 2010 from 2.97% for the three months ended June 30, 2009. As a consequence of the aforementioned, our net interest margin increased to 2.98% for the three months ended June 30, 2010 from 2.89% for the three months ended June 30, 2009.

Total non-interest income increased by $48,000 or 19.8% to $290,000 for the three months ended June 30, 2010 from $242,000 for the three months ended June 30, 2009. The increase in non-interest income resulted primarily from a $97,000 or 64.2% increase in general fees, service charges and other income to $248,000 for the three months ended June 30, 2010 from $151,000 for the three months ended June 30, 2009, partially offset by a $30,000 decrease in gain on sales of loans originated for sale to $56,000 for the three months ended June 30, 2010 from $86,000 for the three months ended June 30, 2009 and a $19,000 decrease in gain on real estate sold to a loss of $14,000 for the three months ended June 30, 2010 from a gain of $5,000 for the three months ended June 30, 2009. General fees, service charges and other income increased primarily as a result of a $67,000 recovery received through litigation relating to a real estate facility where insurance proceeds were improperly retained by a third party. The decrease in gain on sale of loans originated for sale occurred primarily as a result of the Bank holding in portfolio a certain percentage of in-house originated one-to four-family residential mortgage loans for the three months ended June 30, 2010 as opposed to no originations of these products being retained in portfolio for the three months ended June 30, 2009.

Total non-interest expense decreased by $22,000 or 0.7% to $3.165 million for the three months ended June 30, 2010 from $3.187 million for the three months ended June 30, 2009. Salaries and employee benefits expense increased by $97,000 or 7.4% to $1.4 million for the three months ended June 30, 2010 from $1.3 million for the three months ended June 30, 2009. This increase occurred primarily as a result of the retention of several senior level executives whose total compensation is higher than our average employee salary, partially offset by decrease in the number of full time equivalent employees to 86 for the three months ended June 30, 2010, from 89 for the three months ended June 30, 2009. Equipment expense increased by $10,000 or 1.9% to $536,000 for the three months ended June 30, 2010 from $526,000 for the three months ended June 30, 2009. The primary component of this expense item is data service provider expense which increases with the growth in the Banks assets. Occupancy expense and advertising decreased by an aggregate of $10,000 or 2.8% to $344,000 for the three months ended June 30, 2010 from $354,000 for the three months ended June 30, 2009. Regulatory assessments decreased by $288,000 or 60.4% to $189,000 for the three months ended June 30, 2010 from $477,000 for the three months ended June 30, 2009. The decrease in regulatory assessments resulted primarily from the one-time recapitalization assessment levied by the Federal Deposit Insurance Corporation on all financial institutions during the three months ended June 30, 2009. This assessment totaled $282,000 for the Company which was required to be accrued for in the second quarter of 2009 and payable in the third quarter of 2009. Merger related expenses increased by $69,000 or 92.0% to $144,000 for the three months ended June 30, 2010 from $75,000 for the three months ended June 30, 2009. This increase was related exclusively to expenses associated with the merger transaction with Pamrapo Bancorp, Inc. Director fees decreased by $17,000 or 13.6% to $108,000 for the three months ended June 30, 2010 from $125,000 for the three months ended June 30, 2009. Professional fees decreased by $40,000 or 39.6% to $61,000 for the three months ended June 30, 2010 from $101,000 for the three months ended June 30, 2009. Other non-interest expense increased by $157,000 or 70.4% to $380,000 for the three months ended June 30, 2010 from $223,000 for the three months ended June 30, 2009. The increase in other expenses occurred primarily as a result of an increase in loan expense and fees associated with the collection process on certain delinquent loan facilities. Additionally, other non-interest expense is also comprised of stationary, forms and printing, check printing, correspondent bank fees, telephone and communication, shareholder relations and other fees and expenses.

Net income decreased by $355,000 or 17.8% to $1.64 million for the six months ended June 30, 2010 from $2.0 million for the six months ended June 30, 2009. The decrease in net income was due to an increase in non-interest expense and an increase in the provision for loan losses, partially offset by an increase in net interest income and non-interest income and a decrease in income taxes. Net interest income increased by $176,000 or 1.9% to $9.43 million for the six months ended June 30, 2010 from $9.26 million for the six months ended June 30, 2009. This increase in net interest income resulted primarily from a increase of $39.0 million or 6.7% in the average balance of interest earning assets to $624.6 million for the six months ended June 30, 2010 from $585.6 million for the six months ended June 30, 2009, partially offset by a decrease in the average yield on interest earning assets to 5.02% for the six months ended June 30, 2010 from 5.84% for the six months ended June 30, 2009. The average balance of interest bearing liabilities increased by $35.7 million or 7.0% to $549.3 million for the six months ended June 30, 2010 from $513.6 million for the six months ended June 30, 2009, while the average cost of interest bearing liabilities decreased to 2.27% for the six months ended June 30, 2010 from 3.06% for the six months ended June 30, 2009. As a consequence of the decrease in the average yield earned on our interest earning assets, and despite the increase in the balance of average interest earning assets, our net interest margin decreased to 3.02% for the six months ended June 30, 2010 from 3.16% for the six months ended June 30, 2009.

The provision for loan losses totaled $750,000 for the six months ended June 30, 2010 and $650,000 for the six months ended June 30, 2009. The provision for loan losses is established based upon managements review of the Banks loans and consideration of a variety of factors including, but not limited to, (1) the risk characteristics of the loan portfolio, (2) current economic conditions, (3) actual losses previously experienced, (4) significant level of loan growth and (5) the existing level of reserves for loan losses that are probable and estimable. During the six months ended June 30, 2010, the Bank experienced $597,000 in net charge-offs (consisting of $610,000 in charge-offs and $13,000 in recoveries). During the six months ended June 30, 2009, the Bank experienced $16,000 in net charge-offs (consisting of $16,000 in charge-offs and no recoveries). The Bank had non-performing loans totaling $12.5 million or 3.14% of gross loans at June 30, 2010, $11.9 million or 2.92% of gross loans at December 31, 2009 and $5.0 million or 1.20% of gross loans at June 30, 2009. The allowance for loan losses was $6.8 million or 1.71% of gross loans at June 30, 2010, $6.6 million or 1.62% of gross loans at December 31, 2009 and $5.9 million or 1.43% of gross loans at June 30, 2009. The amount of the allowance is based on estimates and the ultimate losses may vary from such estimates. Management assesses the allowance for loan losses on a quarterly basis and makes provisions for loan losses as necessary in order to maintain the adequacy of the allowance. While management uses available information to recognize losses on loans, future loan loss provisions may be necessary based on changes in the aforementioned criteria. In addition various regulatory agencies, as an integral part of their examination process, periodically review the allowance for loan losses and may require the Bank to recognize additional provisions based on their judgment of information available to them at the time of their examination. Management believes that the allowance for loan losses was adequate at June 30, 2010, December 31, 2009 and June 30, 2009.

Total non-interest expense increased by $661,000 or 11.5% to $6.43 million for the six months ended June 30, 2010 from $5.77 million for the six months ended June 30, 2009. Salaries and employee benefits expense increased by $141,000 or 5.3% to $2.77 million for the six months ended June 30, 2010 from $2.63 million for the sRead the The complete Report

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