NewBridge Bancorp ( NASDAQ: NBBC), parent of NewBridge Bank, today reported net income of $373,000 for the three months ended March 31, 2010 compared to a net loss of $3.6 million for the three months ended March 31, 2009. After payment of preferred dividends, the net loss to common shareholders was $357,000, or ($0.02) per diluted share, compared with a net loss to common shareholders of $4.3 million, or ($0.28) per diluted share, for the same quarter a year ago.
Pressley A. Ridgill, President and Chief Executive Officer of NewBridge Bancorp, commented: “Despite continuing economic challenges, we are beginning to see signs of an improving loan portfolio, which is leading to better financial performance. We achieved a first quarter improvement in pre-tax income of $7.0 million from the quarter ended March 31, 2009, to $476,000 from a loss of $6.5 million. This hard won improvement was due in large part to better trends in our nonperforming loan portfolio and improved operating efficiencies. Loan charge-offs continued to fall. Provision expense decreased from $8.5 million in the first quarter of 2009 to $3.7 million in the first quarter of 2010, a decline of 56%. We are increasingly confident that our disciplined approach to early recognition of problems and aggressive loan management has served us well. We are further encouraged as we achieved continued positive trends in rising net interest income and lower noninterest costs. Both of these are tracking closely to our 2010 profit plan. The increase in net interest income led to our higher net interest margin, to just under 4% in the quarter, and we expect it to continue at about that level for the balance of the year.”
Net interest income, net interest margin continued to grow
Net interest income increased $3.3 million to $17.2 million for the first quarter this year from $14.0 million for the same quarter last year. The gain was due primarily to lower interest expense paid on deposits which in addition to the decline in interest related expenses resulted in a wider net interest margin. For the first quarter, the Company’s net interest margin reached 3.97%, or 98 basis points higher than the same period a year ago, and 34 basis points higher than the three months ended December 31, 2009. The weighted average cost of deposits fell 127 basis points to 1.28% for the quarter ended March 31, 2010 compared to 2.55% for the same quarter the year before. Last year, the Company’s deposit prices were negatively impacted by irrational pricing pressure from competing financial institutions. That situation caused intense margin pressure during late 2008 and the first two quarters of 2009 until the higher rate time deposits began to mature. In mid 2009, the Company began shifting its marketing and strategic focus away from higher cost time deposits and towards checking accounts and other core deposit relationships. In addition, softening loan demand and reduced liquidity demands allowed the Company to significantly reduce its dependence on retail time deposits.