- Net interest income increased $402,000 to $5.2 million for the quarter ended September 30, 2011 as compared to $4.8 million for the quarter ended September 30, 2010. This increase was the result of continued growth in earning assets which grew $49.6 million and a 26 basis point decrease in the rates paid on average interest bearing liabilities when comparing the quarters ended September 30, 2011 and 2010.
- Net interest spread decreased 4 basis points to 3.83% as compared to 3.87% when comparing the quarters ended September 30, 2011 and 2010, respectively. Net interest margin decreased 8 basis points to 3.96% as compared to 4.04% when comparing these same periods. This narrowing of the spread and margin were primarily due to the growth in deposits being invested mainly in securities which carry much lower yields than loans.
- Provision for loan loss increased $121,000 or 34.3% to $474,000 for the quarter ended September 30, 2011 as compared to $353,000 for the quarter ended September 30, 2010. During the quarter ended September 30, 2011, the Company added to its provision for loan loss as a result of its assessment of the impact on the loan portfolio for potential losses resulting from the recent destruction caused by Hurricane Irene. The increase was also due to the continued increases in nonperforming assets and loan charge-offs.
- The allowance for loan losses totaled $5.5 million at September 30, 2011 which increased $1.2 million from $4.3 million at September 30, 2010. The level of allowance for loan losses to total loans receivable increased to 1.75% at September 30, 2011 as compared to 1.43% at September 30, 2010.
- Net charge-offs increased to $90,000 for the quarter ended September 30, 2011 from $39,000 for the quarter ended September 30, 2010, an increase of $51,000.
- Nonperforming assets increased to $7.5 million at September 30, 2011 from $5.2 million at September 30, 2010, an increase of $2.3 million. This growth has been the result of adverse changes within the economy and increases in local unemployment compounded by the extended length of time required to complete the foreclosure process in New York State.
- Noninterest income increased $114,000 or 10.4% to $1.2 million for the quarter ended September 30, 2011 as compared to $1.1 million for the quarter ended September 30, 2010, primarily due to an increase in service charges on deposit accounts and debit card fees resulting from continued growth in the number of deposits accounts.
- Noninterest expense increased $130,000 or 3.7% when comparing the quarters ended September 30, 2011 and 2010 at $3.6 million and $3.5 million, respectively. This increase was primarily the result of higher compensation costs of $90,000, higher costs associated with debit cards of $80,000, as well as the recognition of losses on the sale of foreclosed real estate in the amount of $50,000, which were partially offset by lower FDIC insurance premiums of $53,000. The decrease in FDIC insurance premiums was the result of regulatory changes in the method of calculating the premiums.
- Total assets grew $8.9 million or 1.6% to $556.4 million at September 30, 2011 as compared to $547.5 million at June 30, 2011.
- Securities available for sale and securities held to maturity amounted to $202.8 million, or 36.4% of assets, at September 30, 2011 as compared to $214.3 million, or 39.1% of assets at June 30, 2011, a decrease of $11.5 million or 5.4%
- Net loans grew by $6.0 million or 2.0% to $307.0 million at September 30, 2011 as compared to $301.0 million at June 30, 2011. The increase in loans was primarily in nonresidential real estate and commercial installment loans, which generally carry higher yields than residential real estate loans.
- Deposits increased to $492.0 million at September 30, 2011 from $469.9 million at June 30, 2011, an increase of $22.1 million, or 4.7%. This increase was primarily the result of an increase of $18.8 million in balances at the Company’s Commercial Bank subsidiary due primarily to the annual collection of taxes by several local school districts.
- As a result of the increase in deposits, the Company repaid its overnight borrowings with the Federal Home Loan Bank. Borrowings decreased $14.3 million from $26.3 million at June 30, 2011 to $12.0 million at September 30, 2011.
- Total shareholders’ equity amounted to $49.5 million at September 30, 2011, or 8.9% of total assets.
|At or For the Three|
|Months Ended September 30,|
|Dollars In thousands, except share and per share data||2011||2010|
|Net interest income||5,199||4,797|
|Provision for loan losses||474||353|
|Income before taxes||2,281||2,016|
|Weighted average shares outstanding||4,145,828||4,121,299|
|Weighted average diluted shares outstanding||4,190,151||4,152,082|
|Dividends declared per share 2||$0.175||$0.175|
|Selected Financial Ratios|
|Return on average assets||1.10%||1.07%|
|Return on average equity||12.41%||11.70%|
|Net interest rate spread||3.83%||3.87%|
|Net interest margin||3.96%||4.04%|
|Efficiency ratio 1||57.04%||59.83%|
|Non-performing assets to total assets||1.35%||0.98%|
|Non-performing loans to total loans||2.37%||1.67%|
|Allowance for loan losses to non-performing loans||75.05%||86.99%|
|Allowance for loan losses to total loans||1.75%||1.43%|
|Shareholders’ equity to total assets||8.90%||8.68%|
|Dividend payout ratio 2||48.61%||54.47%|
|Book value per share||$11.94||$11.14|
|As of September 30, 2011||As of June 30, 2011|
|Dollars In thousands|
|Total cash and cash equivalents||$25,177||$9,966|
|Securities- available for sale, at fair value||80,673||90,117|
|Securities- held to maturity, at amortized cost||122,085||124,177|
|Federal Home Loan Bank stock, at cost||1,273||1,916|
|Gross loans receivable||312,024||305,620|
|Less: Allowance for loan losses||(5,453)||(5,069)|
|Unearned origination fees and costs, net||399||495|
|Net loans receivable||306,970||301,046|
|Premises and equipment||15,244||15,407|
|Accrued interest receivable||2,740||2,716|
|Foreclosed real estate||243||443|
|Prepaid expenses and other assets||1,980||1,737|
|Liabilities and shareholders’ equity|
|Noninterest bearing deposits||$50,740||$49,313|
|Interest bearing deposits||441,254||420,584|
|Borrowings from FHLB, short term||---||14,300|
|FHLB borrowings, long term||12,000||12,000|
|Accrued expenses and other liabilities||2,882||3,247|
|Total shareholders’ equity||49,509||48,081|
|Total liabilities and shareholders’ equity||$556,385||$547,525|
|Common shares outstanding||4,145,828||4,145,828|