Highlights for 2010
- Net interest income before provision for loan losses increased $1.9 million or 10.1% to $20.6 million from $18.7 million in 2009.
- Total provisions for losses were $6.8 million in 2010, compared to total provisions for losses of $20.4 million in 2009. The total provisions included provision for loan losses of $4.5 million in 2010 and $19.6 million in 2009.
- All requirements imposed by the Cease and Desist Order, effective September 9, 2010, have been met, including:
- Exceeded target Core Capital ratio of 8.00% and target Total Risk Based Capital ratio of 12.00% - the Bank’s Core Capital ratio was 8.82% and Total Risk Based Capital was 13.05% at December 31, 2010, compared to 6.69% and 10.19%, respectively, at December 31, 2009;
- Increased liquidity by $10.1 million, and increased liquid assets to 179% of brokered deposits;
- Substantially reduced brokered deposits by $82.8 million, to $18.2 million at year end;
- Completed a comprehensive review of our loan portfolio - Over 76% of the dollar amount of the gross loan portfolio was reviewed by an independent third party in the fourth quarter, including 100% of our church loan portfolio;
- Developed and are implementing a capital plan, which will increase our common equity base.
- As previously disclosed, we are pursuing our comprehensive Recapitalization Plan. To date, we have obtained (subject to documentation and certain terms and conditions):
- The consent of the U.S. Treasury to exchange our Series D and E Fixed Rate Cumulative Perpetual Preferred Stock for common stock at a discount of 50% of the liquidation amount, plus an undiscounted exchange of the accumulated but unpaid dividends on such preferred stock for common stock;
- An agreement in principle with the holders of both the Series A and Series B Perpetual Preferred Stock to exchange their holdings for common stock at a discount of 50% of the liquidation amount;
- An agreement in principle with our senior bank lender to exchange a portion of our senior loan for common stock at 100% of the face amount to be exchanged and to forgive the accrued interest on the loan to the date of the Recapitalization.
- Received $1.3 million in grants in 2010 from the U.S. Department of the Treasury’s Community Development Financial Institutions (CDFI) Fund, compared to $696 thousand in grants in 2009.
Fourth Quarter 2010 Earnings Summary
For the fourth quarter ended December 31, 2010, our net interest income before provision for loan losses was $4.8 million, which represented a decrease of $186 thousand, or 4%, from the fourth quarter of 2009. The decrease was primarily attributable to a decrease of $11.3 million in average interest-earning assets, combined with a 6 basis point decrease in net interest margin from 3.93% in the fourth quarter of 2009 to 3.87% in the fourth quarter of 2010. The decline in our net interest margin was due to a 21 basis point reduction in the yield on our interest-earning assets, primarily resulting from elevated levels of non-performing loans and higher average balances in lower yielding liquid assets.
Check Out Our Best Services for Investors
Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts
Check Out Our Best Services for Investors
Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
Every recommendation goes through 3 layers of intense scrutinyquantitative, fundamental and technical analysisto maximize profit potential and minimize risk.
Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.