NorthEast Community Bancorp, Inc. Reports Results for the Third Quarter of 2018

Date : 11/07/2018 @ 2:51PM
Source : GlobeNewswire Inc.
Stock : (MM) (NECB)
Quote : 6.93  0.0 (0.00%) @ 2:05AM

NorthEast Community Bancorp, Inc. Reports Results for the Third Quarter of 2018

(MM) (NASDAQ:NECB)
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1 Month : From Oct 2018 to Nov 2018

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NorthEast Community Bancorp, Inc. (OTC PX: NECB) (the “Company”), a majority owned subsidiary of NorthEast Community Bancorp, MHC, and the parent holding company of NorthEast Community Bank (the “Bank”), reported net income of $1.22 million for the quarter ended September 30, 2018, a decrease of 47.63%, compared to net income of $2.34 million for the quarter ended September 30, 2017. 

Financial Condition and Operating Results for September 30, 2018 compared to September 30, 2017:

Net income before taxes for the three months ended September 30, 2018 was $1.60 million compared to $3.91 million for the three months ended September 30, 2017, a decrease of 59.03%.  The decrease in net income before taxes was primarily the result of a provision for loan losses of $3.35 million and an increase of $1.07 million in operating expenses offset by an increase of $2.08 million in net interest income.  The increase in operating expenses was primarily due to increases of $494,000 in salaries and employee benefits, $131,000 in consulting fees, $111,000 in legal fees, $66,000 in personnel/recruitment expenses, and $154,000 in other operating expenses.

Net interest income for the three months ended September 30, 2018 increased by $2.08 million, or 26.22%, to $10.03 million from $7.95 million for the three months ended September 30, 2017.  The increase in net interest income was the result of our continuing focus on construction lending.

A provision for loan losses in the amount of $3.35 million was made for the three months ended September 30, 2018. The provision resulted from the write-off of a loan in the amount of $3.3 million, which is currently the subject of litigation. As previously disclosed, management continues to believe that this outstanding litigation will be settled and, if settled, would result in a partial recovery. 

 Total consolidated assets increased by $85.71 million, or 11.15%, to $854.34 million at September 30, 2018 from $768.63 million at September 30, 2017.  Loans receivable (net) increased by $77.72 million, or 11.53%, to $751.72 million at September 30, 2018 from $674.00 million at September 30, 2017, while commitments, loans-in-process and standby letters of credit outstanding increased to $443.02 million at September 30, 2018 compared to $361.64 million at September 30, 2017.  The increase in loans receivable was primarily due to growth in our construction loan portfolio.

Total liabilities at September 30, 2018 were $729.68 million compared to $653.55 million at September 30, 2017, an increase of $76.13 million, or 11.65%.  The increase in total liabilities was primarily due to a $80.51 million increase in deposits from $577.05 million at September 30, 2017 to $657.56 million at September 30, 2018.

Federal Home Loan Bank advances decreased by $1.84 million, or 2.89%, to $62.03 million at September 30, 2018 from $63.87 million at September 30, 2017.

Total stockholder’s equity increased by $9.59 million, or 8.33%, to $124.67 million at September 30, 2018 from $115.08 million at September 30, 2017.  The increase was a result of net income of $10.05 million for the twelve-month period ended September 30, 2018, partially offset by dividends declared and paid during the twelve-month period.

Total stockholder equity for the nine months from December 31, 2017 to September 30, 2018 increased by $7.77 million from $116.90 million on December 31, 2017 to $124.67 million on September 30, 2018, or 6.65%

Financial Condition at September 30, 2018 compared to December 31, 2017:

Total consolidated assets increased by $39.52 million, or 4.85%, to $854.34 million at September 30, 2018 from $814.82 million at December 31, 2017.  Loans receivable (net) increased by $47.60 million or 6.76% to $751.72 million at September 30, 2018 from $704.12 million at December 31, 2017, while commitments, loans-in-process and standby letters of credit outstanding increased to $443.02 million as of September 30, 2018 compared to $359.42 million at December 31, 2017.  The increase in total assets was due to increases in our construction loan portfolio.

Total liabilities at September 30, 2018 were $729.67 million compared to $697.92 million at December 31, 2017, an increase of $31.75 million, or 4.55%.  The increase in total liabilities was due to a $32.35 million increase in deposits from $625.21 million at December 31, 2017 to $657.56 million at September 30, 2018.  Federal Home Loan Bank advances decreased by $844,000, or 1.34%, to $62.03 million at September 30, 2018 compared to $62.87 million at December 31, 2017.

Non-performing loans totaled $1.86 million, or 0.22% of total assets at September 30, 2018 compared to $4.75 million or 0.58% of total assets at December 31, 2017.  The decrease in non-performing loans was primarily due to the write-off in the third quarter of a commercial loan with an outstanding balance due of approximately $3.3 million, as discussed above.

NorthEast Community Bancorp, Inc.’s total stockholders’ equity at September 30, 2018 is a strong 14.59% compared to 14.35% at December 31, 2017.

About NorthEast Community Bancorp, Inc. - NorthEast Community Bancorp, Inc. is the holding company for NorthEast Community Bank. NorthEast Community Bank is a New York State-chartered savings bank that operates four full-service branches in New York State and three full-service branches in Danvers, Framingham and Quincy, Massachusetts and loan production offices in Danvers, Massachusetts and White Plains and New City, New York. 

This release contains “forward-looking statements” that are based on assumptions and may describe future plans, strategies and expectations of the Company. These forward-looking statements are generally identified by the use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project” or similar expressions. The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors that could have a material adverse effect on the operations of the Company and its subsidiaries include, but are not limited to, changes in market interest rates, regional and national economic conditions, legislative and regulatory changes, monetary and fiscal policies of the United States government, including policies of the United States Treasury and the Federal Reserve Board, the quality and composition of the loan or investment portfolios, demand for loan products, deposit flows, competition, demand for financial services in the Company’s market area, changes in the real estate market values in the Company’s market area and changes in relevant accounting principles and guidelines  These risks and uncertainties should be considered in evaluating any forward-looking statements and undue reliance should not be placed on such statements. Except as required by applicable law or regulation, the Company does not undertake, and specifically disclaims any obligation, to release publicly the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of the statements or to reflect the occurrence of anticipated or unanticipated events.

Contact:Kenneth A. MartinekChief Executive Officer(914) 684-2500

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