Community National Bank (OTC BB: CBNY.OB) today announced second quarter results for 2011. Highlights for the quarter include:
- Net income of $635 thousand for the second quarter of 2011 compared to net income of $323 thousand for the same period in 2010.
- Net interest income grew $638 thousand or 18% over 2010 to $4.2 million for the quarter. The net interest margin was 3.50%.
- Commercial loans increased 20% or $34.3 million to $208.3 million compared to June 30, 2010.
- Deposits increased 12% or $45.7 million to $418 million compared to the same quarter in the prior year, including Demand Deposit growth of $33 million or 49%.
- $0.6 million in gains on the sale of Small Business Administration Loans ("SBA") during the quarter.
- The Bank hosted the Grand Opening of its eighth branch location in Bayside, New York in May.
Chairman, President and CEO, Stuart Lubow commented "We are proud that Community National Bank exceeded the $500 million in total asset plateau for the first time since opening in April 2005. We expect this growth to continue as we celebrated the grand opening of our eighth branch location in Bayside, New York in May and will open our ninth branch location in Melville, New York by the end of the year. We continue to develop banking relationships with small and medium sized business as evident by the growth in business demand deposits. The Bank's commercial loan pipeline remains robust and we expect continued loan growth during the second half of 2011. The Bank's growth in assets, capital and branch locations has enabled us to become a key business partner and an alternative choice for many local businesses that have become frustrated by the lack of service from the larger financial institutions. We are able to help our customers by providing quality customer service so that they can remain focused on growing their own business."
Net Earnings and Net Interest Income
Net income for the quarter ended June 30, 2011 was $635 thousand or $0.10 basic earnings per share as compared to net income of $323 thousand or $0.06 basic earnings per share for the comparable period in 2010.
For the quarter ended June 30, 2011, net interest income and net interest margin were $4.2 million and 3.50%, respectively, compared to $3.5 million and 3.28% for the prior 2010 quarter. The $0.7 million or 20% increase in net interest income was primarily due to the growth in our commercial and residential loan portfolios which were funded through $23 million in sales proceeds and principal repayments from the securities portfolio and an increase of $33 million in demand deposits and $11.8 million in certificate of deposits. The net interest margin increased 22 basis points from the prior year quarter due to the increase in higher yielding loan products as well as reductions in the cost of funds on core deposits and certificate of deposits.
Loans and Asset Quality
Loans held-for-investment increased $16.3 million for an annualized growth rate of 19% to $355.1 million at June 30, 2011 compared to $338.8 million at March 31, 2011. The commercial loan portfolio increased $34.3 million or 20% when compared to the prior year quarter.
Non-Performing loans remained stable at $4.9 million or 1.39% of total loans at June 30, 2011, significantly below the Bank's peer group average. The Bank's provision for loan losses was $473 thousand during the second quarter of 2011 compared to $410 thousand for quarter ended March 31, 2011. The increase in the provision was due to two loans that were classified as non-accrual during the quarter and an increase in the amount of general valuation reserves due to growth in the loan portfolio. The allowance for loan losses to total loans was 1.35% at June 30, 2011, a slight decrease from 1.38% at March 31, 2011. The Bank had $370 thousand in charged off loans during the second quarter.
Further information about the financial condition and performance of Community National Bank is available from its Call Reports filed by the Bank with the FDIC and available on the FDIC website at: http://www2.fdic.gov/idasp/main_bankfind.asp. The Bank expects to file its June 30, 2011 Call Report on or around July 30, 2011.
About Community National Bank
Community National Bank is a Long Island based independent commercial bank and operates eight locations in Nassau, Suffolk and Queen Counties. We offer a full range of modern financial services, backed by state-of-the-art technology. In addition to commercial loans, commercial mortgages, small business loans and lines of credit, residential mortgages, CNB also provides a complete selection of traditional personal and commercial deposit products such as no fee individual and business checking accounts, IRA accounts and statement savings.
Cautionary Statement about Forward-Looking Statements
This release contains certain "forward looking statements" about CNB which, to the extent applicable, are intended to be covered by the safe harbor for forward looking statements provided under the Federal securities laws and, regardless of such coverage, you are cautioned about. Examples of forward-looking statements include but are not limited to, CNB's financial condition, capital ratios, results of operations and outlook. Forward-looking statements are not historical facts. Such statements may be identified by the use of such words as "may," "believe," "expect," "anticipate," "plan," "continue," or similar terminology. These statements relate to future events or our future financial performance and involve risks and uncertainties that may cause our actual results, levels of activity, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we caution you not to place undue reliance on these forward-looking statements. Factors which may cause our forward looking statements to be materially inaccurate include, but are not limited to, a unexpected deterioration in our loan portfolio, unexpected increases in our expenses, greater than anticipated growth, unanticipated regulatory action, unexpected changes in interest rates, a loss of key personnel, an unanticipated loss of existing customers, competition from other institutions causing us unanticipated changes in our deposit or loan rates, increases in FDIC insurance costs and unanticipated adverse changes in our customers' economic conditions or economic conditions in our local area generally.
Forward-looking statements speak only as of the date of this press release We do not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
COMMUNITY NATIONAL BANK | ||||||||||||||
STATEMENTS OF INCOME | ||||||||||||||
Unaudited | ||||||||||||||
For The Three Months Ended | For The Six Months Ended | |||||||||||||
June 30, | June 30, | June 30, | June 30, | |||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||
Interest Income: | ||||||||||||||
Commercial Loans | $2,994,023 | $2,645,591 | $5,923,463 | $5,067,096 | ||||||||||
Residential and Consumer Loans | 1,724,763 | 1,590,295 | 3,288,745 | 3,306,109 | ||||||||||
Securities | 685,455 | 781,066 | 1,371,483 | 1,644,522 | ||||||||||
Money Market Investments | 2,970 | 13,771 | 5,760 | 18,960 | ||||||||||
Total Interest Income | 5,407,211 | 5,030,723 | 10,589,451 | 10,036,687 | ||||||||||
Interest Expense: | ||||||||||||||
NOW, Savings & Money Market | 132,960 | 207,256 | 276,691 | 426,227 | ||||||||||
Certificates of Deposit | 950,174 | 1,101,180 | 1,918,262 | 2,158,943 | ||||||||||
Borrowed Funds | 165,868 | 202,800 | 384,314 | 342,023 | ||||||||||
Total Interest Expense | 1,249,002 | 1,511,236 | 2,579,267 | 2,927,193 | ||||||||||
Net Interest Income | 4,158,209 | 3,519,487 | 8,010,184 | 7,109,494 | ||||||||||
Provision For Loan Losses | 473,000 | 410,000 | 1,233,000 | 717,000 | ||||||||||
Net Interest Income After Provision for Loan Losses | 3,685,209 | 3,109,487 | 6,777,184 | 6,392,494 | ||||||||||
Non-Interest Income: | ||||||||||||||
Service Charges | 123,880 | 92,503 | 238,927 | 164,286 | ||||||||||
Loan Fees & Servicing Income | 111,319 | 24,245 | 181,196 | 89,387 | ||||||||||
Gain on Sale of Investments | 21,597 | 52,915 | 31,381 | 54,983 | ||||||||||
Gain on Sale of Loans | 598,101 | 517,409 | 1,937,566 | 522,121 | ||||||||||
BOLI Income | 156,972 | 39,509 | 292,217 | 39,509 | ||||||||||
Total Non-Interest Income | 1,011,869 | 726,581 | 2,681,287 | 870,286 | ||||||||||
Non-Interest Expense: | ||||||||||||||
Compensation and Benefits | 1,797,948 | 1,490,136 | 3,652,390 | 2,893,372 | ||||||||||
Occupancy and Equipment | 951,748 | 901,056 | 1,886,244 | 1,828,066 | ||||||||||
Advertising | 27,838 | 39,885 | 89,544 | 53,679 | ||||||||||
Other Expenses | 927,290 | 866,416 | 1,851,814 | 1,725,644 | ||||||||||
Total Non-Interest Expense | 3,704,824 | 3,297,493 | 7,479,992 | 6,500,761 | ||||||||||
Income Before Income Taxes | 992,254 | 538,575 | 1,978,479 | 762,019 | ||||||||||
Provision For Income Taxes | 357,302 | 215,701 | 720,800 | 305,062 | ||||||||||
Net Income | $634,952 | $322,874 | $1,257,679 | $456,957 | ||||||||||
Earnings Per Share: | ||||||||||||||
Basic | $0.10 | $0.06 | $0.19 | $0.09 | ||||||||||
Diluted | $0.09 | $0.06 | $0.19 | $0.09 | ||||||||||
Weighted Average Shares Outstanding - Basic | 6,673,181 | 5,179,954 | 6,673,181 | 5,026,351 | ||||||||||
Weighted Average Shares Outstanding - Diluted | 6,701,982 | 5,179,954 | 6,692,901 | 5,026,351 | ||||||||||
COMMUNITY NATIONAL BANK | |||||||||||||||
STATEMENTS OF INCOME | |||||||||||||||
Unaudited | |||||||||||||||
For the Three Months Ended | |||||||||||||||
June 30, | March 31, | December 31, | June 30, | ||||||||||||
2011 | 2011 | 2010 | 2010 | ||||||||||||
Interest Income: | |||||||||||||||
Commercial Loans | $2,994,023 | $2,929,441 | $2,910,143 | $2,645,591 | |||||||||||
Residential and Consumer Loans | 1,724,763 | 1,563,982 | 1,583,430 | 1,590,295 | |||||||||||
Securities | 685,455 | 686,028 | 680,427 | 781,066 | |||||||||||
Money Market Investments | 2,970 | 2,790 | 5,916 | 13,771 | |||||||||||
Total Interest Income | 5,407,211 | 5,182,241 | 5,179,916 | 5,030,723 | |||||||||||
Interest Expense: | |||||||||||||||
NOW, Savings & Money Market | 132,960 | 143,731 | 152,376 | 207,256 | |||||||||||
Certificates of Deposit | 950,174 | 968,088 | 1,046,475 | 1,101,180 | |||||||||||
Borrowed Funds | 165,868 | 218,446 | 226,753 | 202,800 | |||||||||||
Total Interest Expense | 1,249,002 | 1,330,265 | 1,425,604 | 1,511,236 | |||||||||||
Net Interest Income | 4,158,209 | 3,851,976 | 3,754,312 | 3,519,487 | |||||||||||
Provision For Loan Losses | 473,000 | 760,000 | 300,000 | 410,000 | |||||||||||
Net Interest Income After Provision for Loan Losses | 3,685,209 | 3,091,976 | 3,454,312 | 3,109,487 | |||||||||||
Non-Interest Income: | |||||||||||||||
Service Charges | 123,880 | 115,047 | 120,992 | 92,503 | |||||||||||
Loan Fees & Servicing Income | 111,319 | 69,877 | 61,917 | 24,245 | |||||||||||
Gain on Sale of Investments | 21,597 | 9,784 | 215,228 | 52,915 | |||||||||||
Gain on Sale of Loans | 598,101 | 1,339,465 | 159,106 | 517,409 | |||||||||||
BOLI Income | 156,972 | 135,245 | 108,306 | 39,509 | |||||||||||
Total Non-Interest Income | 1,011,869 | 1,669,418 | 665,549 | 726,581 | |||||||||||
Non-Interest Expense: | |||||||||||||||
Compensation and Benefits | 1,797,948 | 1,854,442 | 1,559,078 | 1,490,136 | |||||||||||
Occupancy and Equipment | 951,748 | 934,496 | 911,585 | 901,056 | |||||||||||
Advertising | 27,838 | 61,706 | 60,199 | 39,885 | |||||||||||
Other Expenses | 927,290 | 924,524 | 702,532 | 866,416 | |||||||||||
Total Non-Interest Expense | 3,704,824 | 3,775,168 | 3,233,394 | 3,297,493 | |||||||||||
Income Before Income Taxes | 992,254 | 986,226 | 886,467 | 538,575 | |||||||||||
Provision For Income Taxes | 357,302 | 363,499 | 274,007 | 215,701 | |||||||||||
Net Income | $634,952 | $622,727 | $612,460 | $322,874 | |||||||||||
Earnings Per Share: | |||||||||||||||
Basic | $0.10 | $0.09 | $0.09 | $0.06 | |||||||||||
Diluted | $0.09 | $0.09 | $0.09 | $0.06 | |||||||||||
Weighted Average Shares Outstanding - Basic | 6,673,181 | 6,673,181 | 6,673,181 | 5,179,954 | |||||||||||
Weighted Average Shares Outstanding - Diluted | 6,701,982 | 6,684,195 | 6,681,994 | 5,179,954 | |||||||||||
COMMUNITY NATIONAL BANK | ||||||||||||||
STATEMENTS OF CONDITION | ||||||||||||||
Unaudited | ||||||||||||||
June 30, | March 31, | December 31, | June 30, | |||||||||||
2011 | 2011 | 2010 | 2010 | |||||||||||
Assets: | ||||||||||||||
Cash and Due From Banks | $4,308,554 | $4,733,264 | $3,690,489 | $4,654,965 | ||||||||||
Money Market Investments | 46,961,011 | 3,036,235 | 2,215,083 | 42,477,882 | ||||||||||
Securities - Available-for-Sale | 83,719,729 | 99,466,280 | 110,857,926 | 107,508,416 | ||||||||||
Restricted Stock | 4,140,100 | 4,245,250 | 4,472,200 | 3,367,750 | ||||||||||
Total Securities | 87,859,829 | 103,711,530 | 115,330,126 | 110,876,166 | ||||||||||
Loans Held-For-Sale | - | - | 7,518,629 | 5,065,700 | ||||||||||
Commercial Loans | 208,386,201 | 205,180,420 | 194,518,041 | 174,102,694 | ||||||||||
Residential & Consumer Loans | 146,673,520 | 133,616,246 | 130,020,381 | 115,901,584 | ||||||||||
Gross Loans Held-For-Investment | 355,059,721 | 338,796,666 | 324,538,422 | 290,004,278 | ||||||||||
Less: Allowance For Loans Losses | (4,784,505) | (4,681,642) | (3,956,864) | (3,263,027) | ||||||||||
Net Loans Held-For-Investment | 350,275,216 | 334,115,024 | 320,581,558 | 286,741,251 | ||||||||||
Premises and Equipment, net | 8,126,007 | 7,704,607 | 7,620,331 | 8,024,599 | ||||||||||
Bank Owned Life Insurance ("BOLI") | 15,552,223 | 15,336,213 | 10,260,005 | 10,039,509 | ||||||||||
Other Assets | 7,295,841 | 7,248,198 | 9,628,576 | 6,713,162 | ||||||||||
Total Assets | $520,378,681 | $475,885,071 | $476,844,797 | $474,593,234 | ||||||||||
Liabilities and Stockholders' Equity: | ||||||||||||||
Deposits: | ||||||||||||||
Demand | $100,564,404 | $70,448,381 | $66,609,198 | $67,506,715 | ||||||||||
NOW, Savings & Money Market | 108,291,294 | 107,193,520 | 106,383,448 | 107,530,296 | ||||||||||
Certificates of Deposit | 209,563,822 | 192,355,205 | 186,611,547 | 197,718,233 | ||||||||||
Total Deposits | 418,419,520 | 369,997,106 | 359,604,193 | 372,755,244 | ||||||||||
FHLB Borrowings | 32,957,800 | 37,445,600 | 42,930,582 | 30,892,157 | ||||||||||
Secured Borrowings - SBA Loans | - | - | 6,570,004 | 3,060,000 | ||||||||||
Accrued Expenses and Other Liabilities | 2,329,922 | 2,875,920 | 2,978,842 | 3,494,005 | ||||||||||
Total Liabilities | 453,707,242 | 410,318,626 | 412,083,621 | 410,201,406 | ||||||||||
Stockholders' Equity: | ||||||||||||||
Common Stock, par value $5.00; authorized | ||||||||||||||
10,000,000 shares; issued 6,673,181 shares at | ||||||||||||||
June 30, 2011 and 6,627,981 shares at June 30, 2010 | 33,365,905 | 33,365,905 | 33,365,905 | 33,139,905 | ||||||||||
Additional Paid in Capital | 33,775,379 | 33,732,805 | 33,693,112 | 33,421,447 | ||||||||||
Retained Deficit | (454,231) | (1,089,183) | (1,711,910) | (2,727,942) | ||||||||||
Unrealized (Loss)/Gain on Securities | (15,614) | (443,082) | (585,931) | 558,418 | ||||||||||
Total Stockholders' Equity | 66,671,439 | 65,566,445 | 64,761,176 | 64,391,828 | ||||||||||
Total Liabilities and Stockholders' Equity | $520,378,681 | $475,885,071 | $476,844,797 | $474,593,234 | ||||||||||
COMMUNITY NATIONAL BANK | ||||||||||||||
SELECTED FINANCIAL DATA & BALANCE SHEET COMPONENTS | ||||||||||||||
Unaudited | ||||||||||||||
For The Three Months Ended | For The Six Months Ended | |||||||||||||
June 30, 2011 | June 30, 2010 | June 30, 2011 | June 30, 2010 | |||||||||||
Per Share: | ||||||||||||||
Net Income-Basic | $0.10 | $0.06 | $0.19 | $0.09 | ||||||||||
Average Shares Outstanding - Basic | 6,673,181 | 5,179,954 | 6,673,181 | 5,026,351 | ||||||||||
Net Income - Diluted | $0.09 | $0.06 | $0.19 | $0.09 | ||||||||||
Average Shares Outstanding - Diluted | 6,701,982 | 5,179,954 | 6,692,901 | 5,026,351 | ||||||||||
Book Value | $9.99 | $9.72 | $9.99 | $9.72 | ||||||||||
Performance: | ||||||||||||||
Return on Average Assets | 0.52% | 0.29% | 0.52% | 0.21% | ||||||||||
Return on Average Equity | 3.85% | 2.61% | 3.86% | 1.92% | ||||||||||
Efficiency Ratio | 71.66% | 77.66% | 69.96% | 81.47% | ||||||||||
Yield on Average Earning Assets | 4.56% | 4.70% | 4.63% | 4.88% | ||||||||||
Cost on Average Interest Bearing Liabilities | 1.45% | 1.77% | 1.50% | 1.77% | ||||||||||
Cost of Deposits | 1.12% | 1.43% | 1.17% | 1.47% | ||||||||||
Net Interest Spread | 3.11% | 2.93% | 3.13% | 3.11% | ||||||||||
Net Interest Margin | 3.50% | 3.28% | 3.50% | 3.45% | ||||||||||
June 30, 2011 | March 31, 2011 | December 31, 2011 | June 30, 2010 | |||||||||||
Risk Based Capital: | ||||||||||||||
Leverage Ratio | 13.19% | 13.32% | 13.45% | 14.06% | ||||||||||
Tier 1 | 19.50% | 19.75% | 20.54% | 21.79% | ||||||||||
Total Risk Based | 20.75% | 21.00% | 21.79% | 22.91% | ||||||||||
Asset Quality: | ||||||||||||||
Allowance for Loan Losses to Total Loans | 1.35% | 1.38% | 1.22% | 1.13% | ||||||||||
Allowance for Loan Losses to Non-Performing Loans | 97% | 95% | 94% | 5516% | ||||||||||
Non-Performing Loans to Total Loans | 1.39% | 1.45% | 1.30% | 0.02% | ||||||||||
Non-Performing Assets to Total Assets | 0.95% | 1.03% | 0.88% | 0.01% | ||||||||||
Annualized Quarterly Net Charge offs to Avg. Loans | 0.42% | 0.04% | 0.01% | 0.91% |
Turchette Advertising
Christopher Dale, 973-227-8080, ext. 29
cdale@turchette.com
or
Community
National Bank
Jay McConie, 516-498-9111 Ext 139
Senior
Vice President
Chief Financial Officer