Bancorp of New Jersey Inc. Reports Operating Results (10-Q)

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Nov 16, 2009
Bancorp of New Jersey Inc. (BKJ, Financial) filed Quarterly Report for the period ended 2009-09-30.

BANCORP OF NEW JERSEY INC is a holding company for the Bank of New Jersey, which is a state chartered commercial bank that provides a traditional range of financial products and services to meet the deposit and credit needs of individual customers, small businesses and professionals in the local market area. Bancorp Of New Jersey Inc. has a market cap of $44.86 million; its shares were traded at around $8.85 with a P/E ratio of 46.58 and P/S ratio of 6.49.

Highlight of Business Operations:

Net income for the third quarter of 2009 was $515 thousand, an increase of $276 thousand compared to net income of $239 thousand for the third quarter of 2008. The increase was primarily driven by an increase in the Bank s interest income of $511 thousand combined with a decrease in interest expense of $293 thousand which resulted in an increase to net interest income of $804 thousand for the third quarter of 2009. The increase in net interest income is reflective of management s focus to create a more efficient balance sheet by increasing the interest earning assets as well as increasing the yield on assets already earning income. The increased net interest income more than offset the increased FDIC insurance premiums, the FDIC special assessment, and costs associated with expansion.

During the nine months ended September 30, 2009, net interest income exceeded $6.8 million, an increase of $1.8 million over the 2008 net interest income amount of $5.0 million for the nine months ended September 30, 2008. This increase is also attributable to the increase in interest income from loans, including fees and the decrease in interest expense. Interest income from loans, including fees, securities and federal funds sold reached $11.5 million for the nine months ended September 30, 2009 from $10.8 million for the nine months ended September 30, 2008. At the same time, interest expense decreased by $1.2 million from $5.8 million for the nine months ended September 30, 2008 to $4.6 million for the nine months ended September 30, 2009.

Non-interest income, primarily attributable to service fees, was $55 thousand during the quarter ended September 30, 2009 compared to $57 thousand for the quarter ended September 30, 2008. For the nine months ended September 30, 2009, non-interest income totaled $141 thousand as compared to $202 thousand for the nine months ended September 30, 2008. As these fees are related, primarily, to deposits accounts, the decrease between periods is reflective of decreased customer activity during the period.

Non-interest expense reached $1.8 million during the third quarter of 2009 compared to $1.4 million in the third quarter of 2008, an increase of approximately $400 thousand. During the nine months ended September 30, 2009, non-interest expense reached approximately $5.3 million from approximately $4.3 million for the nine months ended September 30, 2008. These increases reflect increased salaries and employee benefits, occupancy and equipment expense, and other expenses related to opening and operating two additional office locations, as well as the overall growth of the Company.

For the three months ended September 30, 2009, the income tax provision increased by $172 thousand, and reached $351 thousand as compared to $179 thousand for the same period in 2008. For the nine months ended September 30, 2009, income tax expense reached $581 thousand as compared to $287 thousand for the nine months ended September 30, 2008, an increase of $294 thousand. For both the three month and the nine month periods, the increases were due to the increase in income during the respective period. The income tax provisioning is reflective of our pre-tax income and the effect of permanent differences between financial and tax reporting. These permanent tax differences include the recognition of non-deductible stock option expense as required under the guidance now codified as FASB ASC Topic 718, “Comparison – Stock Compensation”.

Total consolidated assets increased $18.8 million, or approximately 6.2%, from $304.1 million at December 31, 2008 to $322.9 million at September 30, 2009. Total deposits increased from $254.0 million at December 31, 2008 to $270.9 million at September 30, 2009, an increase of $16.9 million, or approximately 6.7%. Loans receivable, or “total loans,” increased from $234.9 million at December 31, 2008 to $259.5 million at September 30, 2009, an increase of $24.6 million, or approximately 10.5%.

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