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1st Constitution Bancorp Reports Operating Results (10-Q)

November 15, 2010 | About:
10qk

10qk

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1st Constitution Bancorp (FCCY) filed Quarterly Report for the period ended 2010-09-30.

1st Constitution Bancorp has a market cap of $34.16 million; its shares were traded at around $7.61 with a P/E ratio of 13 and P/S ratio of 0.99. 1st Constitution Bancorp had an annual average earning growth of 1.1% over the past 10 years.

Highlight of Business Operations:

The Company realized net income of $881,599 for the three months ended September 30, 2010, an increase of $260,365, or 41.9%, from the $621,234 reported for the three months ended September 30, 2009. The increase is due primarily to an increase in net interest income for the three months ended September 30, 2010. Net income per diluted common share was $0.15 for the three months ended September 30, 2010 compared to net income per diluted common share of $0.10 for the three months ended September 30, 2009. Net income available to common shareholders increased from $444,251 for the three months ended September 30, 2009 to $704,615 for the three months ended September 30, 2010 principally for the reason indicated above. Net income available to common shareholders in the 2010 and 2009 periods reflected an aggregate of $176,984 and $176,983, respectively, attributable to dividends and discount accretion related to the Fixed Rate Cumulative Perpetual Preferred Stock, Series B (“Preferred Stock Series B”) issued to the United States Department of the Treasury (the “Treasury”). All prior year share information has been adjusted for the effect of a 5% stock dividend declared on December 17, 2009 and paid on February 3, 2010 to shareholders of record on January 19, 2010.

Average interest earning assets increased by $54,592,058, or 9.2%, to $649,496,027 for the quarter ended September 30, 2010 from $594,903,969 for the quarter ended September 30, 2009. Overall, the yield on interest earning assets, on a tax-equivalent basis, decreased 29 basis points to 4.73% for the quarter ended September 30, 2010 when compared to 5.02% for the quarter ended September 30, 2009.

Average interest bearing liabilities increased by $13,569,756, or 2.6%, to $526,001,295 for the quarter ended September 30, 2010 from $512,431,539 for the quarter ended September 30, 2009. Overall, the cost of total interest bearing liabilities decreased 79 basis points to 1.62% for the three months ended September 30, 2010 compared to 2.41% for the three months ended September 30, 2009.

Management considers a complete review of the following specific factors in determining the provisions for loan losses: historical losses by loan category, non-accrual loans, problem loans as identified through internal classifications, collateral values, and the growth and size of the loan portfolio. In addition to these factors, management takes into consideration current economic conditions and local real estate market conditions. Using this evaluation process, the Company s provision for loan losses was $875,000 for the three months ended September 30, 2010 and $505,000 for the three months ended September 30, 2009. While the risk profile of the loan portfolio was reduced by a change in its composition via a $9,482,563 reduction in higher risk construction loans, non-performing loans increased to $8,884,827 at September 30, 2010, as compared to $5,221,174 at September 30, 2009. This change in the overall risk profile of the loan portfolio necessitated the increased provision for loan losses.

All other expenses categories, in the aggregate decreased by $4,655, or 0.3%, to $1,539,554 for the three months ended September 30, 2010 compared to $1,544,209 for the three months ended September 30, 2009. Other expenses are comprised of a variety of operating expenses and fees as well as expenses associated with lending activities.

The Company realized net income of $2,376,416 for the nine months ended September 30, 2010, an increase of 45.6% from the $1,632,534 reported for the nine months ended September 30, 2009. The increase is due primarily to an increase in net interest income, the continued generation of non-interest income and stability in non-interest expenses for the nine months ended September 30, 2010 compared to nine months ended September 30, 2009. Net income available to common shareholders for the nine months ended September 30, 2010 increased to $1,845,464 from $1,089,916 for the nine months ended September 30, 2009 principally for the reasons indicated above. Net income available to common shareholders for the nine months ended September 30, 2010 and 2009 reflected an aggregate of $530,952 and $542,618, respectively, attributable to dividends and discount accretion related to the Preferred Stock Series B issued to the Treasury.

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10qk
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