Broadway Financial Corporation (the “Company”) (NASDAQ Capital Market: BYFC) today reported that its wholly-owned subsidiary, Broadway Federal Bank, f.s.b. (the “Bank”), recently completed the sale of approximately $16 million principal amount of loans, including $13.1 million of non-performing loans. The non-performing loans represented approximately 31% of the Bank’s estimated non-performing loans receivable and non-performing loans held for sale as of December 31, 2012.
The sales were made in cash transactions with two different buyers: a sale of approximately $14.1 million of single family residential loans, including approximately $11.8 million of non-performing single family residential loans representing substantially all of the Bank’s non-performing single family residential loans, and a separate sale of five church loans with an aggregate principal balance of approximately $1.8 million, including four non-performing church loans with an aggregate principal balance of $1.3 million.
The Company does not expect to take any material charge against net income because of the sale of these loans.
Chief Executive Officer, Wayne-Kent Bradshaw, stated, “These sales represent a substantial reduction in our non-performing loans, which will significantly reduce the time and resources that we devote to managing and monitoring non-performing loans. Furthermore, the sales will allow us to re-focus our efforts on improving operations, pursuing growth as permitted under our Cease and Desist Orders, and completing our previously announced Recapitalization. In addition, we believe that these sales represent a major step in addressing regulatory requirements for materially reducing our non-performing loans. With the sales completed, our non-performing loans have been reduced to approximately $23 million, or 6.4% of total estimated assets, after adjusting for the sales, as of December 31, 2012.”
Additional information regarding the loan sales will be made available in the Company’s Form 10-K for 2012, which the Company expects to file in late March.
About Broadway Financial Corporation
Broadway Financial Corporation conducts its operations through its wholly-owned subsidiary, Broadway Federal Bank, f.s.b., which is the leading community-oriented savings bank in Southern California serving low to moderate income communities. We offer a variety of residential and commercial real estate loan products for consumers, businesses, and non-profit organizations, other loan products, and a variety of deposit products, including checking, savings and money market accounts, certificates of deposits and retirement accounts. The Bank operates three full service branches, two in the city of Los Angeles, and one located in the nearby city of Inglewood, California.