Clifton Bancorp Inc. (Nasdaq:CSBK) (the “Company”), the holding
company for Clifton Savings Bank, today announced results for the
second quarter ended September 30, 2016. Net income for the second
quarter was $1.24 million ($0.06 per share, basic and diluted) as
compared to net income of $1.54 million ($0.06 per share, basic and
diluted) for the second quarter ended September 30, 2015. Net
income for the six months ended September 30, 2016 was $2.26
million ($0.10 per share, basic and diluted) as compared to $3.20
million ($0.13 per share, basic and diluted) for the same period in
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 September 30, 2016. The dividend will be paid on December 2,
2016 to stockholders of record on November 18, 2016.
Notable Items
- Total assets increased 4.7%, or $59.1
million, from $1.25 billion at March 31, 2016 to $1.31 billion at
September 30, 2016;
- Net loans increased 13.0%, or $101.4
million, from $780.2 million at March 31, 2016 to $881.6 million at
September 30, 2016;
- Multi-family and commercial real estate
loans increased 61.3%, or $94.1 million, from $153.6 million at
March 31, 2016 to $247.7 million at September 30, 2016;
- Loan mix between one-to-four family
real estate loans and multi-family/commercial real estate loans to
total loans shifted to 70.6% and 28.0%, respectively, at September
30, 2016 from 79.0% and 19.7%, respectively, at March 31,
2016;
- Nonperforming loans to total gross
loans decreased to 0.32% at September 30, 2016 from 0.64% at
September 30, 2015;
- Deposits increased 11.2%, or $77.6
million, from $694.7 million at March 31, 2016 to $772.3 million at
September 30, 2016;
- 484,400 shares of common stock were
repurchased during the three months ended September 30, 2016 at a
weighted average price of $14.95 per share.
Paul M. Aguggia, Chairman, President, and Chief Executive
Officer, stated, “As we pass our fiscal half-year mark, we are
pleased that our strategy and execution have resulted in both
deposit and loan growth. This has been accomplished, in large part,
due to our strong capital position, our innovative approach to
products, services and channels, and our focus on communicating the
essence of what CSBK is all about: a community bank that has always
put the needs of our customers first.”
Balance Sheet and Credit Quality
Review
Total assets increased $59.1 million, or 4.7%, to $1.31 billion
at September 30, 2016, from $1.25 billion at March 31, 2016. The
increase in total assets was primarily due to an increase in
loans.
Net loans increased $101.4 million, or 13.0%, to $881.6 million
at September 30, 2016 from $780.2 million at March 31, 2016.
One-to-four family real estate loans increased $6.0 million, or
1.0%, while multi-family and commercial real estate loans increased
$94.1 million, or 61.3%, during the six months ended September 30,
2016. Securities, including both available for sale and held to
maturity issues, decreased $40.3 million, or 11.3%, to $317.1
million at September 30, 2016 from $357.5 million at March 31,
2016, mainly as a result of calls, maturities and repayments. One
security totaling $3.7 million was sold during the six-month period
ended September 30, 2016, resulting in a gain of $84,000. Cash and
cash equivalents decreased $8.3 million, or 26.8%, to $22.8 million
at September 30, 2016 from $31.1 million at March 31, 2016.
Deposits increased $77.6 million, or 11.2%, to $772.3 million at
September 30, 2016 from $694.7 million at March 31, 2016. Borrowed
funds decreased $7.0 million, or 3.0%, to $224.5 million at
September 30, 2016 from $231.5 million at March 31, 2016. The
Company’s outstanding borrowings as of September 30, 2016 had a
weighted average rate of 1.63% and a weighted average term of 18
months. All outstanding borrowings are with the Federal Home Loan
Bank of New York.
Total stockholders’ equity decreased $12.4 million, or 3.9%, to
$302.9 million at September 30, 2016 from $315.3 million at March
31, 2016, primarily as a result of $13.3 million in repurchases of
common stock, and the payment of $2.7 million in cash dividends,
partially offset by net income of $2.3 million.
Nonaccrual loans decreased $855,000, or 23.4%, to $2.8 million
at September 30, 2016 from $3.7 million at March 31, 2016. Included
in nonaccrual loans at September 30, 2016 were four loans totaling
$568,000 that were current or less than 90 days’ delinquent, but
which were previously 90 days or more delinquent and on nonaccrual
status pending a sustained period of repayment performance
(generally six months). The percentage of nonperforming loans to
total gross loans decreased to 0.32% at September 30, 2016 from
0.47% at March 31, 2016. The allowance for loan losses to
nonperforming loans increased to 185.52% at September 30, 2016 from
119.19% at March 31, 2016, as nonperforming loans decreased, while
the allowance balance increased mainly as a result of provisions
associated with significant increases in loans.
Income Statement Review
Net interest income increased by $529,000, or 8.1%, to $7.07
million for the three months ended September 30, 2016 as compared
to $6.54 million for the three months ended September 30, 2015. Net
interest income increased despite a decrease of 10 basis points in
net interest margin and a decrease of $38.0 million in average net
interest-earning assets.
Net interest income increased by $894,000, or 6.8%, to $14.01
million for the six months ended September 30, 2016 as compared to
$13.12 million for the six months ended September 30, 2015. Net
interest income increased despite a decrease of 7 basis points in
net interest margin and a decrease of $42.7 million in average net
interest-earning assets.
The provision for loan losses increased $405,000, or 405.0%, to
$505,000 for the three months ended September 30, 2016, as compared
to $100,000 for the three months ended September 30, 2015, and
increased $858,000, or 496.0%, to $1.03 million for the six months
ended September 30, 2016, as compared to $173,000 for the six
months ended September 30, 2015. The increase in the provisions for
both periods 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 expenses for the three months ended September 30,
2016 increased $731,000, or 16.0%, to $5.31 million, as compared to
$4.58 million for the three months ended September 30, 2015. The
increase consisted primarily of increases in salaries and employee
benefits of $653,000, or 24.0%, occupancy expense of $83,000, or
23.7%, and equipment expense of $68,000, or 18.4%, partially offset
by a decrease in other expenses, mainly comprised of consulting and
personnel search costs, of $89,000, or 19.8%. The increases in
salaries and employee benefits includes the addition of a chief
operating officer and business development, compliance, lending and
Hoboken Banking Center personnel, as well as typical annual
increases in compensation and benefits expenses, employee stock
ownership plan expense due to 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. The
increases in occupancy and equipment expenses were mainly related
to the costs of the newly opened Hoboken Banking Center, along with
the costs associated with new customer products and services.
Non-interest expenses for the six months ended September 30,
2016 increased $1.69 million, or 18.6%, to $10.79 million, as
compared to $9.10 million for the six months ended September 30,
2015. The increase consisted primarily of increases in salaries and
employee benefits of $1.36 million, or 25.1%, occupancy expense of
$104,000, or 13.9%, equipment expense of $91,000, or 12.5%, and
advertising and marketing expense of $87,000, or 52.7%, partially
offset by a decrease in professional services of $95,000, or 20.3%.
The increases in salaries and employee benefits include the same
items noted above. The increases in occupancy, equipment, as well
as advertising and marketing expenses, were mainly related to the
costs of the newly opened Hoboken Banking Center, along with the
costs associated with new customer products and services.
Professional services decreased due to a decrease in legal
fees.
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
13 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 8, 2016. 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 September 30, At March
31, 2016
2016
(In thousands)
Financial Condition Data: Total assets $
1,312,190 $ 1,253,127 Loans receivable, net 881,593 780,229 Cash
and cash equivalents 22,758 31,069 Securities 317,147 357,462
Deposits 772,306 694,662 FHLB advances 224,500 231,500 Total
stockholders' equity 302,890 315,277
Selected
Consolidated Operating Data
Three Months Ended Six Months Ended
September 30, September 30, 2016
2015 2016 2015 (In thousands, except
share and per share data)
Operating Data: Interest
income $ 9,916 $ 8,739 $ 19,507 $ 17,451 Interest expense
2,847 2,199 5,496 4,334 Net interest income
7,069 6,540 14,011 13,117 Provision for loan losses 505
100 1,031 173 Net interest income after
provision for loan losses 6,564 6,440 12,980 12,944 Non-interest
income 501 452 1,028 966 Non-interest expenses 5,311
4,580 10,790 9,095 Income before income taxes 1,754
2,312 3,218 4,815 Income taxes 513 772 961
1,617 Net income $ 1,241 $ 1,540 $ 2,257 $ 3,198 Basic
earnings per share $ 0.06 $ 0.06 $ 0.10 $ 0.13 Diluted earnings per
share $ 0.06 $ 0.06 $ 0.10 $ 0.13 Average shares outstanding
- basic 22,216 24,633 22,495 25,000 Average shares outstanding -
diluted 22,276 24,687 22,555 25,064
Average Balance Table Three Months
Ended September 30, 2016 2015
Interest Interest Average and
Yield/ Average and Yield/
Balance Dividends
Cost Balance
Dividends Cost
Assets: (Dollars in thousands) Interest-earning assets:
Loans receivable $ 855,838 $ 7,748 3.62 % $ 666,434 $ 6,090 3.66 %
Mortgage-backed securities 267,646 1,734 2.59 % 273,417 1,899 2.78
% Investment securities 59,099 283 1.92 % 116,350 678 2.33 % Other
interest-earning assets 28,402 151 2.13 %
21,280 72 1.35 % Total interest-earning assets 1,210,985
9,916 3.27 % 1,077,481 8,739 3.24 %
Non-interest-earning assets 85,425 77,426
Total
assets $ 1,296,410 $ 1,154,907
Liabilities and stockholders' equity:
Interest-bearing liabilities: Demand accounts $ 53,270 14 0.11 % $
52,423 15 0.11 % Savings and Club accounts 183,426 178 0.39 %
142,039 58 0.16 % Certificates of deposit 492,921
1,731 1.40 % 473,311 1,514 1.28 % Total
interest-bearing deposits 729,617 1,923 1.05 % 667,773 1,587 0.95 %
FHLB Advances 226,250 924 1.63 % 116,625
612 2.10 % Total interest-bearing liabilities 955,867
2,847 1.19 % 784,398 2,199 1.12 %
Non-interest-bearing liabilities: Non-interest-bearing deposits
23,512 13,898 Other non-interest-bearing liabilities 11,652
12,971 Total non-interest-bearing liabilities 35,164
26,869 Total liabilities 991,031 811,267
Stockholders' equity 305,379 343,640
Total
liabilities and stockholders' equity $ 1,296,410
$ 1,154,907 Net interest income $ 7,069 $
6,540 Interest rate spread 2.08 % 2.12 % Net interest margin 2.33 %
2.43 % Average interest-earning assets to average interest-bearing
liabilities 1.27 x 1.37 x
Six Months Ended September
30, 2016 2015 Interest
Interest Average and Yield/
Average and Yield/ Balance
Dividends Cost
Balance Dividends
Cost Assets: (Dollars in thousands)
Interest-earning assets: Loans receivable $ 828,462 $ 14,966 3.61 %
$ 656,681 $ 12,074 3.68 % Mortgage-backed securities 270,566 3,577
2.64 % 276,092 3,841 2.78 % Investment securities 65,440 691 2.11 %
122,985 1,387 2.26 % Other interest-earning assets 29,388
273 1.86 % 28,795 149 1.03 % Total
interest-earning assets 1,193,856 19,507 3.27 % 1,084,553
17,451 3.22 % Non-interest-earning assets
85,722 78,857
Total assets $ 1,279,578
$ 1,163,410 Liabilities and stockholders'
equity: Interest-bearing liabilities: Demand accounts $ 53,390
29 0.11 % $ 53,107 30 0.11 % Savings and Club accounts 173,567 304
0.35 % 141,918 116 0.16 % Certificates of deposit 484,690
3,351 1.38 % 478,253 3,014 1.26 % Total
interest-bearing deposits 711,647 3,684 1.04 % 673,278 3,160 0.94 %
FHLB Advances 226,357 1,812 1.60 % 112,714
1,174 2.08 % Total interest-bearing liabilities 938,004
5,496 1.17 % 785,992 4,334 1.10 %
Non-interest-bearing liabilities: Non-interest-bearing deposits
21,463 13,701 Other non-interest-bearing liabilities 10,834
12,184 Total non-interest-bearing liabilities 32,297
25,885 Total liabilities 970,301 811,877
Stockholders' equity 309,277 351,533
Total
liabilities and stockholders' equity $ 1,279,578
$ 1,163,410 Net interest income $ 14,011 $
13,117 Interest rate spread 2.10 % 2.12 % Net interest margin 2.35
% 2.42 % Average interest-earning assets to average
interest-bearing liabilities 1.27 x 1.38 x
Asset Quality Data Six
Six Months Year Months Ended
Ended Ended September 30, March 31,
September 30, 2016 2016 2015 (Dollars
in thousands) Allowance for loan losses: Allowance at beginning of
period $ 4,360 $ 3,750 $ 3,475 Provision for loan losses 1,031 703
173 Charge-offs (193 ) (93 ) (26 ) Recoveries 2
- 3 Net charge-offs (191 ) (93 )
(23 ) Allowance at end of period $ 5,200
$ 4,360 $ 3,625 Allowance for loan
losses to total gross loans 0.59 % 0.56 % 0.53 % Allowance for loan
losses to nonperforming loans 185.52 % 119.19 % 83.72 %
At September 30, At March 31, At
September 30, 2016 2016 2015 (Dollars in
thousands) Nonperforming Assets: Nonaccrual loans: One- to
four-family real estate $ 2,619 $ 3,412 $ 3,452 Multi-family real
estate - - 568 Commercial real estate 184 186 192 Construction real
estate - - 49 Consumer real estate - 60
69 Total nonaccrual loans 2,803 3,658 4,330 Real
estate owned 943 58 -
Total nonperforming assets $ 3,746 $ 3,716 $ 4,330
Total nonperforming loans to total gross loans 0.32 %
0.47 % 0.64 % Total nonperforming assets to total assets 0.29 %
0.30 % 0.38 %
Selected Consolidated Financial Ratios Three Months
Ended Six Months Ended September 30, September
30,
Selected
Performance Ratios (1):
2016 2015 2016 2015 Return on average
assets 0.38% 0.53% 0.35% 0.55% Return on average equity 1.63% 1.79%
1.46% 1.82% Interest rate spread 2.08% 2.12% 2.10% 2.12% Net
interest margin 2.33% 2.43% 2.35% 2.42% Non-interest expenses to
average assets 1.64% 1.59% 1.69% 1.56% Efficiency ratio (2) 70.16%
65.50% 71.75% 64.58% Average interest-earning assets to average
interest-bearing liabilities 1.27x 1.37x 1.27x 1.38x Average equity
to average assets 23.56% 29.75% 24.17% 30.22% Dividend payout ratio
107.28% 95.06% 119.36% 139.15% Net charge-offs to average
ourtstanding loans during the periods 0.04% 0.00% 0.05% 0.01%
(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 September 30, June 30, March
31, December 31, September 30,
2016
2016
2016
2015
2015
(In thousands except shares and per share data)
Operating
Data
Interest income $ 9,916 $ 9,591 $ 9,158 $ 8,736 $ 8,739 Interest
expense 2,847 2,649 2,468
2,300 2,199 Net interest income 7,069
6,942 6,690 6,436 6,540 Provision for loan losses 505
526 703 189 100
Net interest income after provision for loan losses 6,564
6,416 5,987 6,247 6,440 Non-interest income 501 527 440 460 452
Non-interest expenses 5,311 5,479
5,173 4,833 4,580 Income
before income taxes 1,754 1,464 1,254 1,874 2,312 Income taxes
513 448 376 549
772 Net income $ 1,241 $ 1,016 $
878 $ 1,325 $ 1,540
Share
Data
Basic earnings per share $ 0.06 $ 0.04 $ 0.04 $ 0.05 $ 0.06 Diluted
earnings per share $ 0.06 $ 0.04 $ 0.04 $ 0.05 $ 0.06 Dividends per
share $ 0.06 $ 0.06 $ 0.06 $ 0.06 $ 0.06 Average shares outstanding
- basic 22,216 22,775 23,434 24,475 24,633 Average shares
outstanding - diluted 22,276 22,834 23,479 24,521 24,687 Shares
outstanding at period end 23,086 23,576 24,000 25,394 25,745
Financial
Condition Data
Total assets $ 1,312,190 $ 1,285,825 $ 1,253,127 $ 1,167,739 $
1,153,895 Loans receivable, net 881,593 826,629 780,229 700,283
677,286 Cash and cash equivalents 22,758 30,140 31,069 30,493
17,869 Securities 317,147 338,624 357,462 356,977 379,582 Deposits
772,306 719,592 694,662 674,002 678,624 FHLB advances 224,500
244,000 231,500 147,000 124,000 Total stockholders' equity 302,890
309,487 315,277 333,956 338,267
Assets
Quality:
Total nonperforming assets $ 3,746 $ 3,481 $ 3,716 $ 4,387 $ 4,330
Total nonperforming loans to total gross loans 0.32 % 0.38 % 0.47 %
0.63 % 0.64 % Total nonperforming assets to total assets 0.29 %
0.27 % 0.30 % 0.38 % 0.38 % Allowance for loan losses $ 5,200 $
4,775 $ 4,360 $ 3,750 $ 3,625 Allowance for loan losses to total
gross loans 0.59 % 0.58 % 0.56 % 0.53 % 0.53 % Allowance for loan
losses to nonperforming loans 185.52 % 153.34 % 119.19 % 85.48 %
83.72 %
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