BROOKLYN, N.Y., April 30 /PRNewswire-FirstCall/ -- Brooklyn Federal
Bancorp, Inc. (the "Company") (Nasdaq: BFSB), the parent company of Brooklyn
Federal Savings Bank (the "Bank"), today reported net income of $1.5 million
for the quarter ended March 31, 2008 compared to a net loss of $317,000 for
the same period in 2007. The Company reported basic and diluted earnings per
common share of $0.12 for the quarter ended March 31, 2008 compared to basic
and diluted loss per common share of $(0.02) for the quarter ended March 31,
2007.
On April 15, 2008 the Company's Board of Directors approved a cash
dividend of $0.07 per share of common stock. The dividend will be paid to
stockholders of record as of May 15, 2008, payable on May 29, 2008.
On April 30, 2008, Brooklyn Federal Savings Bank officially opened its
fifth full service branch facility located at 1174 Jericho Turnpike, Commack,
New York. Mr. Di Lorenzo, Vice Chairman and Chief Executive Officer
commented, "We are excited about the opening of our fifth full service office.
It will allow us to meet the banking needs of our existing customers as well
as attract new customers."
The Company also reported net income for the six months ended March 31,
2008 of $2.7 million, an increase of $1.3 million, or 94.5%, compared to
$1.4 million for the same period ended March 31, 2007. Basic and diluted
earnings per common share were $0.21 and $0.10 for the six months ended March
31, 2008 and March 31, 2007, respectively.
Total assets at March 31, 2008 were $419.5 million, an increase of $29.1
million, or 7.5%, compared to total assets of $390.4 million at September 30,
2007. The increase was primarily due to increases in loans held-for-sale of
$22.2 million, or 37.7%, to $81.4 million at March 31, 2008 from $59.2 million
at September 30, 2007, net loans receivable of $6.4 million, or 2.8%, to
$231.9 million at March 31, 2008 from $225.5 million at September 30, 2007,
securities investments, which include securities available-for-sale and
held-to-maturity, of $1.0 million, or 1.3%, to $79.0 million at March 31, 2008
from $78.0 million at September 30, 2007, Federal Home Loan Bank ("FHLB") of
New York stock of $701,000, or 67.9%, to $1.7 million at March 31, 2008 from
$1.0 million at September 30, 2007, other assets, which include accrued
interest receivable, premises and equipment, bank owned life insurance,
prepaid and other assets of $186,000, or 1.1% to $17.7 million at March 31,
2008 from $17.5 million at September 30, 2007, offset in part by decreases in
investments in certificates of deposit of $794,000, or 20.4%, to $3.1 million
at March 31, 2008 from $3.9 million at September 30, 2007 and cash and due
from banks of $666,000, or 12.3%, to $4.7 million at March 31, 2008 from $5.4
million at September 30, 2007.
Total deposits increased by $15.6 million, or 5.4%, to $302.8 million at
March 31, 2008 from $287.2 million at September 30, 2007. The increase was
primarily due to increases in certificates of deposit of $11.0 million, or
6.8%, to $173.9 million at March 31, 2008 from $162.9 million at September 30,
2007, interest-bearing deposits, which includes savings accounts, NOW accounts
and money market accounts, of $4.1 million, or 3.8%, to $112.4 million at
March 31, 2008 from $108.3 million at September 30, 2007 and non-interest
bearing deposits of $513,000, or 3.2%, to $16.5 million at March 31, 2008 from
$16.0 million at September 30, 2007. Total borrowings, which represent
short-term and long-term FHLB of New York advances, increased by $12.6
million, or 136.1%, to $21.9 million at March 31, 2008 from $9.3 million at
September 30, 2007. Advance payments by borrowers for taxes and insurance,
accrued expenses and other liabilities decreased by $457,000, or 5.2%, to $8.3
million at March 31, 2008 from $8.7 million at September 30, 2007.
Stockholders' equity increased by $1.3 million, or 1.6%, to $86.6 million at
March 31, 2008 from $85.3 million at September 30, 2007. The increase was
primarily due to the addition of net income, offset in part by the implemented
stock buy back programs and the payments of cash dividends.
COMPARISON OF OPERATING RESULTS FOR THE QUARTERS ENDED MARCH 31, 2008 AND
2007
Total net interest income before provision for loan losses decreased
$134,000, or 3.1%, to $4.3 million for the quarter ended March 31, 2008
compared to $4.4 million for the quarter ended March 31, 2007. The primary
reason for the decrease was decreased interest income for the quarter ended
March 31, 2008 of $211,000, or 3.0%, to $6.8 million compared to $7.0 million
for the comparable quarter in 2007, offset by decreased interest expense of
$77,000, or 2.9%, to $2.6 million for the quarter ended March 31, 2008 from
$2.7 million for the quarter ended March 31, 2007.
The average balance of net loans, including loans held-for-sale, increased
$20.3 million, or 7.1%, to $306.9 million for the quarter ended March 31, 2008
compared to $286.6 million for the quarter ended March 31, 2007. The total
average balance of the Company's securities and other interest-earning assets
decreased $9.3 million, or 9.5%, to $89.1 million for the quarter ended March
31, 2008 compared to $98.4 million for the comparable period in 2007. The
Company continued to deploy the funds from repayments in its securities
portfolio and net deposit inflows primarily into loan products. The average
balance of total interest-earning assets increased $11.1 million, or 2.9%, to
$396.0 million for the quarter ended March 31, 2008 compared to $384.9 million
for the comparable quarter in 2007. The average yield on total
interest-earning assets decreased 42 basis points to 6.90% for the quarter
ended March 31, 2008 compared to 7.32% for the comparable period in 2007. The
average balance of deposits, which includes savings accounts, money market,
NOW accounts and certificates of deposit, increased by $18.1 million, or 6.9%,
to $282.3 million for the quarter ended March 31, 2008 compared to $264.2
million for the same quarter in 2007. The average balance of borrowings,
which includes short and long term advances from the FHLB of New York,
decreased by $8.5 million, or 28.6%, to $21.1 million for the quarter ended
March 31, 2008 compared to $29.6 million for the quarter ended March 31, 2007.
The average cost of total interest-bearing liabilities decreased 22 basis
points to 3.40% for the quarter ended March 31, 2008 from 3.62% for the same
quarter in 2007.
The loan loss provision increased by $65,000, to $52,000 for the quarter
ended March 31, 2008 compared to a recovery of $13,000 for the quarter ended
March 31, 2007.
Non-interest income increased by $284,000, or 47.4%, to $883,000 for the
quarter ended March 31, 2008 from $599,000 for the same quarter in 2007. The
increase was primarily due to increases in syndicated loan fees of $220,000,
net gain on sale of loans held-for-sale of $171,000, bank owned life insurance
income of $4,000, offset in part by reductions in loan servicing and
miscellaneous loan fees of approximately $108,000 and depositor related fees
of $3,000.
Non-interest expense decreased by $3.0 million, or 53.4%, to $2.7 million
for the quarter ended March 31, 2008 from $5.7 million for the same period in
2007. The decrease was mainly due to decreases in compensation and benefit
expense of $3.0 million, professional fees of approximately $91,000 and data
processing fees of $50,000, offset in part by an increase in occupancy and
equipment expense of $73,000. The Company recorded the vesting charges of the
Company's stock-based incentive plan of $3.1 million in the quarter ended
March 31, 2007.
Provision for income taxes increased by $1.3 million, to $921,000 for the
quarter ended March 31, 2008 compared to a $407,000 benefit for the same
quarter in 2007. The primary reason for the increase was increased taxable
income before income taxes.
COMPARISON OF OPERATING RESULTS FOR THE SIX MONTHS ENDED MARCH 31, 2008
AND 2007
Net interest income before provision for loan losses decreased $438,000,
or 5.0%, to $8.3 million for the six months ended March 31, 2008 from $8.7
million for the same period in 2007. The primary reason for the decrease was
decreased interest income of $658,000, or 4.6%, to $13.5 million for the six
months ended March 31, 2008 from $14.2 million for the same period in 2007,
offset by a decreased interest expense of $220,000, or 4.0%, to $5.2 million
for the six months ended March 31, 2008 from $5.4 million for the same period
in 2007.
The average balance of net loans, including loans held-for-sale, increased
$10.9 million, or 3.8%, to $300.3 million for the six months ended March 31,
2008 from $289.4 million for the same period in 2007. The Company continues to
utilize repayments on its securities portfolio and net deposit inflows
primarily into loan products. The total average balance of the Company's
securities and other interest-earning assets decreased $12.4 million, or 12.4%
to $87.6 million for the six months ended March 31, 2008 compared to $100.0
million for same period in 2007. The average yield on total interest-earning
assets decreased 31 basis points to 6.98% for the six months ended March 31,
2008 from 7.29% for the same period in 2007. The average balance of
interest-bearing deposits, which includes savings accounts, money market
accounts, NOW accounts and certificates of deposit, increased $19.3 million,
or 7.4%, to $279.7 million for the six months ended March 31, 2008 from $260.4
million for the same period in 2007. The average balance of borrowings, which
includes short and long term FHLB of New York advances, decreased $22.0
million, or 58.8%, to $15.4 million for the six months ended March 31, 2008
from $37.4 million for the same period in 2007. The average cost of total
interest-bearing liabilities decreased 11 basis points to 3.54% for the six
months ended March 31, 2008 from 3.65% for the same period in 2007.
The loan loss provision increased $116,000, to $120,000 for the six months
ended March 31, 2008 from $4,000 for the same period in 2007. The primary
reasons for this increase was increased loan production in the commercial
mortgage loan and one- to four-family mortgage loan portfolios.
Non-interest income increased $181,000, or 13.1%, to $1.6 million for the
six months ended March 31, 2008 from $1.4 million for the period ended in
2007. The primary reasons for the increase were the increases in the net gain
on sale of mortgage loans of approximately $211,000, loan syndication fees of
$103,000 and bank owned life insurance income of $10,000, offset in part by
reductions in loan servicing and other loan fees of $128,000, depositor
related fees of $7,000 and miscellaneous fees and other income of
approximately $8,000.
Non-interest expense decreased $2.6 million, or 32.5%, to $5.5 million for
the six months ended March 31, 2008 from $8.1 million for the same period in
2007. The decrease is primarily due to expense reductions in compensation and
fringe benefits of $2.6 million, professional fees of $61,000, data
processing fees of $67,000 and other miscellaneous expense of $2,000, offset
in part by an increase in occupancy and equipment expense of $134,000. The
Company recorded the vesting charges of the Company's stock-based incentive
plan of $3.1 million in the quarter ended March 31, 2007.
Provision for income taxes increased $971,000, or 152.0%, to $1.6 million
for the six months ended March 31, 2008 from $639,000 the same period in 2007.
The primary reason for the increase is increased income before income taxes.
The effective income tax rate was 37.7% for the six months ended March 31,
2008 compared to 31.8% for the same period in 2007.
STOCK REPURCHASE PROGRAMS
The Company's Board of Directors authorized a $2.0 million stock
repurchase program in August 2007. The Company completed the $2.0 million
repurchase program on March 18, 2008 by repurchasing 147,339 shares at an
average cost of $13.57 per share, with a total cost of approximately $2.0
million. In March 2008 the Company's Board of Directors authorized a $3.0
million stock repurchase program. The Company is currently repurchasing shares
through its $3.0 million repurchase program and as of March 31, 2008, the
Company had repurchased 1,250 shares, at an average cost of $12.10 per share,
with a total cost of approximately $15,000.
Brooklyn Federal Savings Bank operates five banking offices, two located
in Brooklyn and one each in Nassau and Suffolk County, New York. The Bank
opened its fifth banking office, located in Commack, Suffolk County, New York,
on April 30, 2008. Additional financial data for the quarter and six months
ended March 31, 2008 may be found in Brooklyn Federal Bancorp's Quarterly
Report on Form 10-Q, which will be filed with the Securities and Exchange
Commission.
This press release may contain certain "forward-looking statements" which
may be identified by the use of such words as "believe," "expect," "intend,"
"anticipate," "should," "planned," "estimated," and "potential." Examples of
forward-looking statements include, but are not limited to, estimates with
respect to our financial condition, results of operations and business that
are subject to various factors which could cause actual results to differ
materially from these estimates and most other statements that are not
historical in nature. These factors include, but are not limited to, general
and local economic conditions, changes in interest rates, deposit flows,
demand for mortgage and other loans, real estate values, and competition;
changes in accounting principles, policies or guidelines; changes in
legislation or regulation; and other economic, competitive, governmental,
regulatory, and technological factors affecting our operations, pricing,
products and services.
FINANCIAL HIGHLIGHTS
At March 31, At September 30,
2008 2007
(In thousands)
Selected Financial Condition Data:
Total assets $419,562 $390,434
Cash and due from banks 4,732 5,398
Certificates of deposit 3,096 3,890
Securities available-for-sale 4,630 4,601
Securities held-to-maturity 74,333 73,354
Loans held-for-sale 81,447 59,153
Loans receivable, net 231,866 225,467
Deposits 302,773 287,155
Borrowings 21,889 9,271
Stockholders' equity 86,608 85,259
For the Three For the Six
Months Ended Months Ended
March 31, March 31,
2008 2007 2008 2007
(In thousands, except (In thousands, except
per share data) per share data)
Selected Operating Data:
Interest income $6,833 $7,044 $13,533 $14,191
Interest expense 2,581 2,658 5,221 5,441
Net interest income before
provision for loan losses 4,252 4,386 8,312 8,750
Provision for (recovery of)
loan losses 52 (13) 120 4
Net interest income after
provision for loan losses 4,200 4,399 8,192 8,746
Non-interest income 883 599 1,565 1,384
Non-interest expense 2,669 5,722 5,481 8,120
Income (loss) before income taxes 2,414 (724) 4,276 2,010
Provision for (benefit of)
income taxes 921 (407) 1,610 639
Net income $1,493 $(317) $2,666 $1,371
Basic earnings (loss) per
common share $0.12 $(0.02) $0.21 $0.10
Diluted earnings (loss) per
common share $0.12 $(0.02) $0.21 $0.10
At or For the Three At or For the Six
Months Ended Months Ended
March 31, March 31,
2008 2007 2008 2007
Selected Financial Ratios:
Performance Ratios:
Return on average assets (1) 1.44 % (0.32)% 1.31 % 0.67 %
Return on average equity (1) 6.96 % (1.53)% 6.24 % 3.34 %
Interest rate spread (2) 3.50 % 3.70 % 3.44 % 3.64 %
Net interest margin (1)(3) 4.29 % 4.56 % 4.29 % 4.49 %
Efficiency ratio (4) 51.98 % 114.78 % 55.49 % 80.13 %
Non-interest expense to average
total assets (1) 2.57 % 5.69 % 2.69 % 3.99 %
Average interest-earning assets
to average interest-bearing
liabilities 130.51 % 131.05 % 131.42 % 130.76 %
Asset Quality Ratios:
Non-performing assets as a
percent of total assets 0.00 %(5) 0.03 %
Non-performing loans as a
percent of total loans 0.01 % 0.04 %
Allowance for loan losses as a
percent of total loans 0.61 % 0.63 %
Other Data:
Number of full service offices 4 4 4 4
(1) Ratio is annualized.
(2) Represents the difference between the weighted-average yield on
interest-earning assets and the weighted-average cost of
interest-bearing liabilities for the period.
(3) Represents net interest income as a percent of average
interest-earning assets for the period.
(4) Represents non-interest expense divided by the sum of net interest
income and non-interest income.
(5) Less than 0.01%
SOURCE Brooklyn Federal Bancorp, Inc.
BROOKLYN 
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