Clifton Bancorp Inc. (Nasdaq:CSBK) (the “Company”), the holding
company for Clifton Savings Bank, today announced results for the
quarter and year ended March 31, 2016. Net income for the quarter
was $878,000 ($0.04 per share, basic and diluted) as compared to
net income of $3.51 million ($0.14 per share, basic, $0.13 per
share, diluted) for the quarter ended March 31, 2015. Net income
for the year ended March 31, 2016 was $5.40 million ($0.22 per
share, basic and diluted) as compared to $8.55 million ($0.33 per
share, basic and diluted) for fiscal 2015.
The Board of Directors also announced today that the Company
will pay a cash dividend of $0.06 per common share for the quarter
ended March 31, 2016. The dividend will be paid on June 10, 2016 to
stockholders of record on May 27, 2016.
The results of operations for the three months and year ended
March 31, 2016 were most significantly affected by:
- Gains on sale of securities, which
decreased $1.9 million for both the three months and year ended
March 31, 2016;
- Increases in provision for loan losses
of $603,000 and $348,000, for the three months and year ended March
31, 2016, respectively, mainly due to loan growth;
- Increases in salaries and employee
benefits and directors’ compensation expenses related to the 2015
Equity Incentive Plan, which, in total, amounted to $439,000 and
$1.02 million, respectively, for the three months and year ended
March 31, 2016;
- Decreases in income from bank owned
life insurance of $788,000 and $536,000, for the three months and
year ended March 31, 2016, respectively, due to the prior year
including proceeds from a death benefit.
Other Notable Items
- Net loans increased 11.4% and 21.7%, or
$79.9 million and $139.1 million, during the three months and year
ended March 31, 2016, respectively;
- One-to-four family real estate loans
increased 3.0% and 10.8%, or $18.0 million and $60.4 million,
during the three months and year ended March 31, 2016,
respectively;
- Multi-family and commercial real estate
loans increased 69.9% and 106.9%, or $63.2 million and $79.4
million, during the three months and year ended March 31, 2016,
respectively;
- Loan mix between one-to-four family
real estate, and multi-family and commercial real estate loans to
total loans shifted from 86.7% and 11.6%, respectively, at March
31, 2015 to 79.0% and 19.7%, respectively, at March 31, 2016;
- Nonperforming loans to total gross
loans decreased to 0.47% at March 31, 2016 from 0.88% at March 31,
2015;
- 1,387,029 and 4,007,753 shares of
common stock were repurchased during the three months and year
ended March 31, 2016, respectively, at a weighted average price of
$14.28 and $14.02 per share.
Paul M. Aguggia, Chairman, President, and Chief Executive
Officer, stated, “Our fiscal year 2016 results demonstrate that our
strategic plan is being implemented effectively. We generated a
significant increase in our multi-family and commercial real estate
portfolios and continued to shift our deposit base to transactional
accounts. Much of this was accomplished in our fourth quarter. In
addition, our investment in talented professionals, initiatives to
generate business, innovative products, and our new Hoboken
location are taking root. We look forward to building upon the
momentum created during the quarter and the year.”
Balance Sheet and Credit Quality
Review
Total assets increased $66.2 million, or 5.6%, to $1.25 billion
at March 31, 2016, from $1.19 billion at March 31, 2015. The
increase in total assets was primarily due to an increase in
loans.
Net loans increased $139.1 million, or 21.7%, to $780.2 million
at March 31, 2016 from $641.1 million at March 31, 2015.
One-to-four family real estate loans increased $60.4 million, or
10.8%, while multi-family and commercial real estate loans
increased $79.4 million, or 106.9%, during fiscal 2016. The
increase included $38.5 million in participations in commercial
real estate loans purchased from in-market financial institutions.
Securities, including both available for sale and held to maturity
issues, decreased $61.4 million, or 14.7%, to $357.5 million at
March 31, 2016 from $418.9 million at March 31, 2015, mainly as a
result of calls, maturities and repayments on securities.
Securities totaling $1.9 million were sold during the year ended
March 31, 2016, resulting in a gain of $72,000. Cash and cash
equivalents decreased $18.2 million, or 37.0%, to $31.1 million at
March 31, 2016 from $49.3 million at March 31, 2015.
Deposits decreased $4.8 million, or 0.7%, to $694.7 million at
March 31, 2016 from $699.5 million at March 31, 2015. The Company’s
emphasis on transaction account generation resulted in a 3.1%
increase in the final quarter of 2016. Borrowed funds increased
$124.0 million, or 115.4%, to $231.5 million at March 31, 2016 from
$107.5 million at March 31, 2015. The Company’s outstanding
borrowings as of March 31, 2016 have a weighted average rate of
1.53% and a weighted average term of 16 months. All outstanding
borrowings are with the Federal Home Loan Bank of New York.
Total stockholders’ equity decreased $52.7 million, or 14.3%, to
$315.3 million at March 31, 2016 from $368.0 million at March 31,
2015, primarily as a result of $56.3 million in repurchases of
common stock, and the payment of $7.3 million in cash dividends,
partially offset by net income of $5.4 million.
Non-accrual loans decreased $1.9 million, or 35.2%, to $3.7
million at March 31, 2016 from $5.6 million at March 31, 2015.
Included in non-accrual loans at March 31, 2016 were six loans
totaling $606,000 that were current or less than 90 days
delinquent, but which were previously 90 days or more delinquent
and on a non-accrual status pending a sustained period of repayment
performance (generally six months). The percentage of nonperforming
loans to total gross loans decreased to 0.47% at March 31, 2016
from 0.88% at March 31, 2015. The allowance for loan losses to
nonperforming loans increased to 119.19% at March 31, 2016 from
61.53% at March 31, 2015, as nonperforming loans decreased, while
the allowance balance increased mainly as a result of a significant
increase in the loan balance.
Income Statement Review
Net interest income increased by $289,000, or 4.5%, to $6.69
million for the three months ended March 31, 2016 as compared to
$6.40 million for the three months ended March 31, 2015. The
increase in net interest income was primarily the result of an
increase of 7 basis points in net interest margin partially offset
by a decrease of $38.2 million in average net interest-earning
assets.
Net interest income increased $115,000, or 0.4%, to $26.24
million for the year ended March 31, 2016 as compared to $26.13
million for the year ended March 31, 2015, driven by an increase of
$12.5 million in average net interest-earning assets and an
increase of 3 basis points in net interest margin.
The provision for loan losses increased $603,000, or 603.0%, to
$703,000 for the three months ended March 31, 2016, as compared to
$100,000 for the three months ended March 31, 2015, and $348,000,
or 48.5%, to $1.07 million for the year ended March 31, 2016, as
compared to $717,000 for the year ended March 31, 2015. The
increase in the provision for the year ended March 31, 2016 was
mainly the result of the significant increase in the balance of
outstanding loans, partially offset by more favorable trends in
qualitative factors related to delinquencies considered in the
periodic review of the general valuation allowance.
Non-interest income decreased $2.65 million, or 85.8%, to
$440,000 for the three months ended March 31, 2016 from $3.09
million for the three months ended March 31, 2015, and $2.44
million, or 56.7%, to $1.87 million for the year ended March 31,
2016 from $4.31 million for the year ended March 31, 2015. The
decrease in both periods was mainly attributable to a decrease in
income from bank owned life insurance and a significant decrease in
gain on sales of securities. In 2015, income from bank owned life
insurance for both periods included proceeds from a death benefit.
Gains on sale of securities totaled $1.9 million and $2.0 million,
respectively, during the three months and year ended March 31,
2015, as compared to no gains and $72,000 in gains recorded during
the three months and year ended March 31, 2016, respectively.
Non-interest expenses for the three months ended March 31, 2016
increased $811,000, or 18.6%, to $5.17 million for the three months
ended March 31, 2016, as compared to $4.36 million for the three
months ended March 31, 2015. The increase consisted primarily of
increases in salaries and employee benefits of $532,000, or 20.6%,
directors’ compensation of $144,000, or 71.2%, and equipment
expense of $95,000, or 27.2%. The increase in equipment expense was
mainly related to the development and implementation of new
customer products and services, as well as additional costs related
to our new Hoboken location. Non-interest expenses for the year
ended March 31, 2016 increased $2.0 million, or 11.7%, to $19.1
million as compared to $17.1 million for the year ended March 31,
2015. The increase consisted primarily of an increase in salaries
and employee benefits of $1.68 million, or 17.3%, and directors’
compensation of $156,000, or 15.7%.
The increases in salaries and employee benefits during both
periods includes the addition of business development, compliance
and Hoboken location staff, typical annual increases in
compensation and benefits expenses, an increase in employee stock
ownership plan expense due an increase in the price of the
Company’s common stock, and the expense related to the granting of
equity awards under the Company’s 2015 Equity Incentive Plan.
About Clifton Bancorp
Inc.
Clifton Bancorp Inc. is the holding company of Clifton Savings
Bank (CSBK), a federally chartered savings bank headquartered in
Clifton, New Jersey. CSBK is a metropolitan, community-focused bank
serving residents and small businesses in its market area through
12 full-service banking centers. For additional investor relations
information, including subscribing to email alerts, visit
cliftonbancorp.com.
Forward-Looking
Statements
Clifton Bancorp makes forward-looking statements in this news
release. These forward-looking statements may include: statements
of goals, intentions, earnings expectations, and other
expectations; estimates of risks and of future costs and benefits;
assessments of probable loan and lease losses; assessments of
market risk; and statements of the ability to achieve financial and
other goals.
Forward-looking statements are typically identified by words
such as “believe,” “expect,” “anticipate,” “intend,” “outlook,”
“estimate,” “forecast,” “project” and other similar words and
expressions. Forward-looking statements are subject to numerous
assumptions, risks and uncertainties, which change over time.
Forward-looking statements speak only as of the date they are made.
Clifton Bancorp does not assume any duty and does not undertake to
update its forward-looking statements. Because forward-looking
statements are subject to assumptions and uncertainties, actual
results or future events could differ, possibly materially, from
those that Clifton Bancorp anticipated in its forward-looking
statements and future results could differ materially from
historical performance.
Clifton Bancorp’s forward-looking statements are subject to the
following principal risks and uncertainties: general economic
conditions and trends, either nationally or locally; conditions in
the securities markets; changes in interest rates; changes in
deposit flows, and in the demand for deposit, loan, and investment
products and other financial services; changes in real estate
values; changes in the quality or composition of the loan or
investment portfolios; changes in competitive pressures among
financial institutions or from non-financial institutions; the
ability to retain key members of management; changes in
legislation, regulations, and policies; and a variety of other
matters which, by their nature, are subject to significant
uncertainties. Clifton Bancorp provides greater detail regarding
some of these factors in the “Risk Factors” section of its Annual
Report on Form 10-K, which was filed on June 5, 2015. Clifton
Bancorp’s forward-looking statements may also be subject to other
risks and uncertainties, including those that it may discuss
elsewhere in this news release or in its filings with the SEC,
accessible on the SEC’s website at www.sec.gov.
Selected Consolidated Financial Condition
Data At March 31, 2016
2015
(In thousands)
Financial Condition Data: Total assets $ 1,253,127 $
1,186,924 Loans receivable, net 780,229 641,084 Cash and cash
equivalents 31,069 49,308 Securities 357,462 418,875 Deposits
694,662 699,476 FHLB advances 231,500 107,500 Total stockholders'
equity 315,277 368,001
Selected Consolidated Operating Data
Three Months EndedMarch 31, Year Ended March
31, 2016 2015 2016 2015 (In
thousands, except share and per share data)
Operating Data:
Interest income $ 9,158 $ 8,558 $ 35,345 $ 35,162 Interest expense
2,468 2,157 9,102 9,034 Net interest
income 6,690 6,401 26,243 26,128 Provision for loan losses
703 100 1,065 717
Net interest income after provision for
loan losses
5,987 6,301 25,178 25,411 Non-interest income 440 3,094 1,866 4,313
Non-interest expenses 5,173 4,362 19,101
17,106 Income before income taxes 1,254 5,033 7,943 12,618
Income taxes 376 1,520 2,542 4,064 Net
income $ 878 $ 3,513 $ 5,401 $ 8,554 Basic earnings per share $
0.04 $ 0.14 $ 0.22 $ 0.33 Diluted earnings per share $ 0.04 $ 0.13
$ 0.22 $ 0.33 Average shares outstanding - basic 23,434
25,979 24,477 25,538 Average shares outstanding - diluted 23,479
26,073 24,533 25,698
Average Balance Table
Three Months Ended March 31, 2016
2015
AverageBalance
InterestandDividends
Yield/Cost
AverageBalance
InterestandDividends
Yield/Cost
Assets: (Dollars in thousands) Interest-earning assets:
Loans receivable $739,496 $6,713 3.63% $636,175 $5,756 3.62%
Mortgage-backed securities 275,526 1,851 2.69% 283,461 2,013 2.84%
Investment securities 81,566 495 2.43% 143,308 697 1.95% Other
interest-earning assets 28,521 99 1.39% 45,633 92 0.81% Total
interest-earning assets 1,125,109 9,158 3.25% 1,108,577 8,558 3.09%
Non-interest-earning assets 84,339 81,989
Total
assets $1,209,448 $1,190,566
Liabilities and stockholders' equity: Interest-bearing
liabilities: Demand accounts $55,477 15 0.11% $54,581 18 0.13%
Savings and Club accounts 141,844 75 0.21% 138,978 53 0.15%
Certificates of deposit 464,519 1,541 1.33% 500,158 1,523 1.22%
Total interest-bearing deposits 661,840 1,631 0.99% 693,717 1,594
0.92% FHLB Advances 195,375 837 1.71% 108,750 563 2.07% Total
interest-bearing liabilities 857,215 2,468 1.15% 802,467 2,157
1.08% Non-interest-bearing liabilities:
Non-interest-bearing deposits 17,124 12,295 Other
non-interest-bearing liabilities 12,067 9,983 Total
non-interest-bearing liabilities 29,191 22,278 Total
liabilities 886,406 824,745 Stockholders' equity 323,042 365,821
Total liabilities and stockholders' equity $1,209,448
$1,190,566 Net interest income $6,690 $6,401 Interest
rate spread 2.10% 2.01% Net interest margin 2.38% 2.31%
Average interest-earning assets to average
interest-bearing liabilities
1.31
x
1.38
x
Year Ended March 31, 2016
2015
AverageBalance
InterestandDividends
Yield/Cost
AverageBalance
InterestandDividends
Yield/Cost
Assets: (Dollars in thousands) Interest-earning assets:
Loans receivable $687,670 $25,107 3.65% $617,696 $23,150 3.75%
Mortgage-backed securities 275,419 7,553 2.74% 298,251 8,998 3.02%
Investment securities 104,447 2,363 2.26% 146,327 2,657 1.82% Other
interest-earning assets 28,985 322 1.11% 46,693 357 0.76% Total
interest-earning assets 1,096,521 35,345 3.22% 1,108,967 35,162
3.17% Non-interest-earning assets 79,759 107,642
Total
assets $1,176,280 $1,216,609
Liabilities and stockholders' equity: Interest-bearing
liabilities: Demand accounts $54,074 60 0.11% $55,544 72 0.13%
Savings and Club accounts 141,174 254 0.18% 140,118 236 0.17%
Certificates of deposit 472,152 6,085 1.29% 519,183 6,399 1.23%
Total interest-bearing deposits 667,400 6,399 0.96% 714,845 6,707
0.94% FHLB Advances 141,885 2,703 1.91% 119,423 2,327 1.95% Total
interest-bearing liabilities 809,285 9,102 1.12% 834,268 9,034
1.08% Non-interest-bearing liabilities: Non-interest-bearing
deposits 14,817 11,676 Other non-interest-bearing liabilities
11,689 11,182 Total non-interest-bearing liabilities 26,506 22,858
Total liabilities 835,791 857,126 Stockholders' equity
340,489 359,483
Total liabilities and stockholders'
equity
$1,176,280 $1,216,609 Net interest income
$26,243 $26,128 Interest rate spread 2.10% 2.09% Net interest
margin 2.39% 2.36%
Average interest-earning assets to average
interest-bearing liabilities
1.35
x
1.33
x
Asset Quality Data Year Ended
March 31, 2016 2015 (Dollars in thousands)
Allowance for loan losses: Allowance at beginning of period $ 3,475
$ 3,071 Provision for loan losses 1,065 717 Charge-offs (183
) (313 ) Recoveries 3 - Net charge-offs
(180 ) (313 ) Allowance at end of period $ 4,360
$ 3,475 Allowance for loan losses to total
gross loans 0.56 % 0.54 % Allowance for loan losses to
nonperforming loans 119.19 % 61.53 %
At March
31, 2016 2015 (Dollars in thousands)
Nonperforming Assets: Nonaccrual loans: One- to four-family real
estate $ 3,412 $ 4,555 Multi-family real estate - 581 Commercial
real estate 186 439 Consumer real estate 60 73
Total nonaccrual loans 3,658 5,648 Real estate owned
58 - Total nonperforming assets $ 3,716
$ 5,648 Total nonperforming loans to total gross
loans 0.47 % 0.88 % Total nonperforming assets to total assets 0.30
% 0.48 %
Selected Consolidated Financial
Ratios
Three Months EndedMarch
31,
Year Ended March 31,
Selected
Performance Ratios (1):
2016 2015 2016 2015 Return on
average assets 0.29% 1.18% 0.46% 0.70% Return on average equity
1.09% 3.84% 1.59% 2.38% Interest rate spread 2.10% 2.01% 2.10%
2.09% Net interest margin 2.38% 2.31% 2.39% 2.36% Non-interest
expenses to average assets 1.71% 1.47% 1.62% 1.41% Efficiency ratio
(2) 72.55% 45.94% 67.95% 56.19%
Average interest-earning assets to average
interest-bearing liabilities
1.31x 1.38x 1.35x 1.33x Average equity to average assets 26.71%
30.73% 28.95% 29.55% Dividend payout ratio 159.23% 44.35% 135.40%
89.22%
Net charge-offs to average outstanding
loans during the period
0.05% 0.00% 0.03% 0.05%
(1)
Performance ratios are annualized.
(2)
Represents non-interest expense divided by
the sum of net interest income and non-interest income including
gains and losses on the sale of assets.
Quarterly Data Quarter Ended
March 31,2016
December 31,2015
September 30,2015
June 30,2015
March 31,2015
(In thousands except shares and per share data)
Operating
Data
Interest income $ 9,158 $ 8,736 $ 8,739 $ 8,712 $ 8,558 Interest
expense 2,468 2,300 2,199
2,135 2,157 Net interest income 6,690
6,436 6,540 6,577 6,401 Provision for loan losses 703
189 100 73 100
Net interest income after provision for
loan losses
5,987 6,247 6,440 6,504 6,301 Non-interest income 440 460 452 514
3,094 Non-interest expenses 5,173 4,833
4,580 4,515 4,362 Income
before income taxes 1,254 1,874 2,312 2,503 5,033 Income taxes
376 549 772 845
1,520 Net income $ 878 $ 1,325 $
1,540 $ 1,658 $ 3,513
Share
Data
Basic earnings per share $ 0.04 $ 0.05 $ 0.06 $ 0.07 $ 0.14 Diluted
earnings per share $ 0.04 $ 0.05 $ 0.06 $ 0.07 $ 0.13 Dividends per
share $ 0.06 $ 0.06 $ 0.06 $ 0.12 $ 0.06 Average shares outstanding
- basic 23,434 24,475 24,633 25,367 25,979 Average shares
outstanding - diluted 23,479 24,521 24,687 25,440 26,073 Shares
outstanding at period end 24,000 25,394 25,745 25,960 27,326
Financial
Condition Data
Total assets $ 1,253,127 $ 1,167,739 $ 1,153,895 $ 1,152,707 $
1,186,924 Loans receivable, net 780,229 700,283 677,286 654,802
641,084 Cash and cash equivalents 31,069 30,493 17,869 23,498
49,308 Securities 357,462 356,977 379,582 395,386 418,875 Deposits
694,662 674,002 678,624 685,248 699,476 FHLB advances 231,500
147,000 124,000 107,500 107,500 Total stockholders' equity 315,277
333,956 338,267 347,764 368,001
Assets
Quality:
Total nonperforming assets $ 3,716 $ 4,387 $ 4,330 $ 5,340 $ 5,648
Total nonperforming loans to total gross loans 0.47 % 0.63 % 0.64 %
0.81 % 0.88 % Total nonperforming assets to total assets 0.30 %
0.38 % 0.38 % 0.46 % 0.48 % Allowance for loan losses $ 4,360 $
3,750 $ 3,625 $ 3,525 $ 3,475 Allowance for loan losses to total
gross loans 0.56 % 0.53 % 0.53 % 0.54 % 0.54 % Allowance for loan
losses to nonperforming loans 119.19 % 85.48 % 83.72 % 66.01 %
61.53 %
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