Broadway Financial Corporation (the “Company”) (NASDAQ Capital Market: BYFC), parent company of Broadway Federal Bank, f.s.b. (the “Bank”), today reported net earnings of $1.9 million, or $0.44 per diluted common share, for the year ended December 31, 2010, as compared to a net loss of ($6.5) million, or ($4.14) per diluted common share, for 2009. The improvement in net earnings reflected higher net interest income before loan loss provisions, substantially reduced provisions for losses, and higher non-interest income. The Company reported total provisions for losses of $6.8 million during 2010, compared to total provisions for losses of $20.4 million during 2009.
Net earnings for the fourth quarter of 2010 were $237 thousand, or ($0.03) loss per diluted common share, as compared to a net loss of ($7.5) million, or ($4.43) per diluted common share, for the fourth quarter of 2009. During the fourth quarter of 2010, the Bank recognized total provisions of $2.2 million compared to total provisions of $15.8 million in the comparable quarter in 2009.
Chief Executive Officer, Paul C. Hudson noted that, “2010 was a tumultuous but defining year in which we refocused on core profitability, balance sheet strength and management processes and procedures. As a result, we increased the Bank’s capital ratios to levels that exceed regulatory requirements, implemented more stringent and comprehensive procedures for originating, underwriting, documenting and servicing loans, enhanced our management team in various loan review and servicing functions, attained a much stronger liquidity position, and substantially reduced our brokered deposits. In addition, we have taken steps to address the recommendations of an independent third party that completed a comprehensive review of our loan portfolio and processes in the fourth quarter. Also, in late 2010 we adopted a plan to recapitalize the Company in 2011 to further enhance our capital ratios, simplify our capital structure, substantially reduce the servicing requirements of senior securities, and improve our common equity base and market float.” Mr. Hudson further emphasized that, “The Bank’s focus on serving the needs of low to moderate income urban communities represents a differentiated strategy that supports core earnings, despite the weak local economy, and depressed real estate market.”