Albina Community Bancorp (OTCBB:ACBC), the holding
company of Albina Community Bank, the only certified community
development bank headquartered in Portland, today reported it
earned $12,000, or $0.01 per diluted share, in the second quarter
ended June 30, 2012. This compared to $98,000, or $0.07 per share,
earned in the first quarter of 2012, and $101,000, or $0.08 per
share for the second quarter a year ago. Albina’s net income was
$110,000 or $0.08 per share for the first six months of 2012,
compared to $262,000, or $0.20 for the like period a year ago.
Continued improvements to asset quality and lower cost of funds
contributed to profits in the first and second quarters of this
year.
Net income at Albina Community Bank was $143,000 in the second
quarter of 2012, compared to $247,000 in the preceding quarter and
$233,000 in the second quarter a year ago. For the first six months
of 2012, the bank earned $390,000.
“This quarter’s results mark the fifth profitable quarter out of
the last six consecutive quarters for both the bank and the holding
company, reflecting our ongoing improving operations, particularly
with credit quality,” remarked Cheryl Cebula, President and Chief
Executive Officer of Albina Community Bank. “Although loan demand
has remained weak, we have made substantial progress in reducing
problem assets; and we have had very few, if any, construction
loans on the books since 2010. As a result, we did not provision
for any potential loan losses this quarter.”
“We are especially pleased with the bank’s progress and
appreciate the support we have received from our loyal employees
and investors, as well as from local businesses throughout the
greater Portland neighborhoods,” added Cebula. “In addition, we
continue to attract new customers to the bank while retaining and
expanding existing relationships. As a result, deposit trends
remain positive, as we continue to build a solid base in local core
deposits allowing us to be less reliant on brokered CDs.”
“In the meantime, we remain focused on our capital raising
efforts and continue to work with our financial advisors,” added
Cebula. “With improving credit metrics, our return to
profitability, a strong core deposit base and our status as a
community development bank, we believe we have a compelling story
for socially responsible investors. In addition, we are in the
final stages of placing the majority of the New Market Tax Credits
we were awarded in 2009, which is expected to contribute to
revenues for the holding company later this year.” Albina Community
Bank currently meets two of the three regulatory capital ratios for
‘adequately capitalized’ designation.
Financial Highlights (at or for the period ended June 30,
2012):
- Diluted earnings per share in the
second quarter of 2012 were $0.01, compared to $0.07 per diluted
share reported in the first quarter and $0.08 in the second quarter
of 2011.
- Deposits totaled $123.8 million, up 1%
from $123.0 million from the preceding quarter and flat from $123.3
million a year ago. Non-interest-bearing deposits accounted for 29%
of total deposits at June 30, 2012.
- Total assets grew 1% to $134.2 million,
from $133.4 million in the preceding quarter and declined 1%
compared to $135.7 million in the like quarter a year ago.
- Gross loans were $84.1 million,
compared to $85.4 million at March 31, 2012, and $98.3 million in
the year ago quarter.
- Net interest margin (NIM) was 3.61% in
the second quarter of 2012 and 3.91% year-to-date.
- Total non-interest expense dropped 13%
to $1.5 million from $1.7 million a year ago.
Credit Quality
Improvements in asset quality continued as reflected in the
following metrics:
- Nonperforming assets (NPAs) improved to
$4.4 million, or 3.29% of total assets at June 30, 2012, down 20%
from $5.5 million, or 4.12% of total assets a year ago, and down 5%
from $4.6 million, or 3.48% of total assets at March 31, 2012.
- Nonperforming loans (NPLs) declined
$323,000 in the second quarter of 2012, to $4.4 million, or 5.25%
of total loans, from $4.7 million, or 4.81% of total loans in the
like quarter a year ago, and declined $232,000 from $4.6 million,
or 5.43% of total loans at March 31, 2012.
- Albina had no other real estate owned
(OREO) at June 30, 2012 or March 31, 2012. As of June 30, 2011,
OREO was $795,000.
- For the quarter ended June 30, 2012,
charge-offs, net of recoveries, totaled $6,000 compared to $42,000
in the same quarter a year ago. Net charge-offs were $177,000 in
the first quarter of 2012.
- As a result of improving credit quality
metrics, the allowance for loan and lease losses (ALLL) to loan
ratio remained high at 3.31% at the end of the second quarter,
compared to 3.27% at March 31, 2012, and 3.03% at the end of the
second quarter a year ago. There was no provision for loan losses
for the quarter ended June 30, 2012, or for the like quarter a year
ago. A provision of $60,000 was booked in the quarter ended March
31, 2012.
“We continue to persevere with our borrowers, diligently working
to bring nonperforming loans into performing status. As a result,
our nonperforming loans have declined 7% from a year ago and 5%
from the first quarter,” Cebula said. “In addition, $2.7 million,
or 61%, of loans classified as NPAs, were current on their payments
at quarter end.” These NPAs are classified as nonaccrual loans due
to cash flow deficiencies for properties, which the borrowers are
supplementing from other sources.
Balance Sheet
Albina Community Bancorp’s total assets were $134.2 million at
June 30, 2012, compared to $135.7 million at June 30, 2011 and
$133.4 million at March 31, 2012.
The investment securities portfolio totaled $19.4 million at the
end of June, an increase of 8% from $17.9 million a year ago, and
declined 13% from $22.2 million at March 31, 2012. At June 30,
2012, the investment portfolio was comprised primarily of
government-sponsored mortgage-backed securities that have an
average life estimated at 1.5 years.
“Although loan demand has remained sluggish, we are seeing loan
demand start to pick up, and as the economy improves we hope to see
this trend continue during the year. To that end, our loan officers
are active in our communities promoting our revised competitive
products to credit worthy customers. We believe the rates we are
offering will help us compete for new loans,” said Cebula. “We have
ample liquidity to deploy by holding short-term marketable
securities and interest-bearing cash. And, of course, we have
available lines of credit at the Federal Home Loan Bank and the
Federal Reserve Bank.”
Loans, net of reserves, declined to $81.3 million at quarter
end, from $82.6 million at March 31, 2012, and $95.4 million at
June 30, 2011. The decline in total loans during the second quarter
was largely due to Albina exiting consumer loan participations in
the first quarter combined with the current weakness in loan
demand.
Albina’s loan portfolio remains well-diversified with a wide
variety of borrowers and collateral. Approximately 79% of the loan
portfolio is secured by either residential or commercial real
estate, with approximately 38% of Albina’s commercial real estate
(CRE) being owner-occupied. The following table shows the changes
in the loan portfolio in each category:
(Dollars in thousands)
As of the Date Ended (Certain
loan balances have been reclassified
June 30,
March 31, June 30, between categories in the
current period.)
2012 2012 2011 (unaudited)
(unaudited) (unaudited)
Loans
Commercial business $ 17,004 20.2 % $ 19,631 23.0 % $ 20,075 20.4 %
R/E construction - 0.0 % - 0.0 % - 0.0 % Commercial R/E 47,151 56.1
% 46,971 55.0 % 50,553 51.4 % Multifamily residential 2,464 2.9 %
2,483 2.9 % 3,535 3.6 % One to four family residential 16,488 19.6
% 15,275 17.9 % 16,398 16.7 % Consumer 1,087 1.3 % 1,193 1.4 %
7,911 8.0 % Unearned Loan Fees (120 ) -0.1 % (117 )
-0.1 % (128 ) -0.1 % Total Loans 84,073 100.0 % 85,436 100.0
% 98,343 100.0 %
“We continue to be heartened by the support we receive from our
neighboring communities reflected by the growth of our local core
deposits,” said Cebula. “As the only certified community
development bank headquartered in Portland, we pride ourselves on
understanding the financial needs of the small businesses in the
communities we serve.”
Non-interest-bearing deposits increased 21% year-over-year and
accounted for 29% of total deposits. Total deposits increased
slightly to $123.8 million at June 30, 2012, from $123.0 million at
March 31, 2012, and remained relatively flat from $123.3 million a
year ago. Interest-bearing and savings accounts represented 42% of
total deposits, and time certificates dropped 25% year-over-year
representing 29% of total deposits at the end of the second quarter
2012. Albina has significantly reduced its reliance on internet and
brokered deposits, replacing approximately $13 million of such
maturing deposits with locally sourced core deposits since March
31, 2011.
Operating Results
Net interest income before the provision for loan losses was
$1.1 million in the second quarter of 2012, compared to $1.4
million in the second quarter a year ago, and $1.3 million for the
first quarter of 2012. Net interest income for the second quarter
of 2012 decreased 13% from the second quarter primarily as a result
of lower yields on loans and investment securities. No loan loss
provision was booked in the second quarter of 2012 or the like
quarter a year ago. A provision of $60,000 was booked in the first
quarter of 2012.
For the first six months of 2012, net interest income before the
provision for loan losses, was $2.3 million, compared to $3.0
million for the six months ended June 30, 2011. The decline in net
interest income year-to-date was primarily due to the decrease in
the average balance of loans and the lower yields received from
loans.
The net interest margin (NIM) contracted to 3.61% for the second
quarter of 2012, compared to 4.21% for the first quarter of 2012,
and 4.45% for the second quarter a year ago. For the first six
months of 2012, net interest margin was 3.91% compared to 4.72% for
the first six months of 2011. The NIM compression in the second
quarter and year-to-date was largely due to lower yields from the
investment portfolio and lower yield on loans, the result of
historically low interest rates.
Non-interest income was $391,000 in the second quarter of 2012,
compared to $426,000 in second quarter of 2011. Non-interest income
in the first quarter of 2012 was $344,000. In the first six months
of 2012, non-interest income was $735,000, compared to $768,000 in
the first six months of 2011. Merchant and card interchange income
in the second quarter was up 12% year-over-year and increased 10%
from the preceding quarter, reflecting the increased volume of
customer transactions.
“We continue to closely monitor our expenses with current
quarter costs related to managing the loan portfolio and OREO down
78% from the second quarter a year ago,” Cebula said. “Expenses
related to professional fees are down 38% from the like quarter
year ago, and FDIC assessments are also down from a year ago.”
Total non-interest expense dropped 13% to $1.5 million in the
second quarter, from $1.7 million in the second quarter a year ago.
Non-interest expense in the first six months of 2012 decreased 14%
to $2.9 million, from $3.4 million in the first six months of
2011.
Other Relevant News
Albina Community Bancorp recently announced the appointment of
banking veteran, Joey Ingman as Senior Vice President/Chief
Financial Officer. Prior to joining Albina, Ingman was the
Controller at First Independent Bank, Vancouver, Washington. First
Independent Bank, which had approximately $780 million in assets,
was acquired by Sterling Savings Bank earlier this year. Ingman
brings 12 years of community banking experience to Albina.
Cheryl Cebula, President and Chief Executive Officer of Albina
Community Bank, was elected to the board of directors of the Oregon
Bankers Association in July 2012.
About Albina Community Bancorp
Albina Community Bank is a locally owned, full-service,
independent commercial bank committed to investing in individuals,
families, businesses and local neighborhoods. The Bank promotes
community development by providing products and services and
banking solutions that are directed towards improving the social or
economic conditions of underserved peoples or residents of
distressed communities. Albina offers a wide range of competitive
banking solutions, while also maintaining its mission to promote
jobs, growth of small businesses, and wealth in our local Portland
neighborhoods. Track Albina’s community involvement by viewing its
scorecard at: www.albinabank.com/company/scorecard.cfm.
Albina Community Bank opened in December 1995 as the sole
subsidiary of Albina Community Bancorp. Albina is one of
approximately 60 commercial banks across the United States
certified by the U.S. Treasury Department’s Community Development
Financial Institutions Fund as a community development financial
institution. Albina is the only CDFI-certified commercial bank
headquartered in Oregon. Albina operates from five local Portland
locations including offices at: 2002 Northeast Martin Luther King
Jr. Boulevard; 8040 North Lombard in the St. Johns neighborhood of
North Portland; 4020 Northeast Fremont Street in the Beaumont
neighborhood; 5636 Northeast Sandy Boulevard in the Rose City Park
neighborhood of the International District; and 430 Northwest 10th
Avenue in Portland’s Pearl District; and a remote ATM at New
Columbia in North Portland. For more information about Albina
Community Bank, please call 503-287-7537 or visit
www.albinabank.com.
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Act of 1995, including
statements concerning the continued financial performance of the
company and its plans and opportunities for future growth. These
forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ materially
than those expected. Specific risks include, but are not limited
to, general business and economic conditions, competitive factors,
pricing pressures, further interest rate changes, and other factors
listed from time to time in Albina Community Bancorp’s regulatory
reports.
Albina Community Bancorp Balance
Sheet (Dollars in thousands)
As of the Date Ended
June 30, March 31, June 30, 2012
2012 2011 (unaudited) (unaudited) (unaudited)
ASSETS Cash and due from banks $ 312 $ 402 $ 499
Interest-bearing deposits 22,956 17,860 10,650 Federal funds sold
28 18 18
Total cash and cash equivalents 23,297 18,280 11,167
Investment securities 19,418 22,205 17,909 Federal Home Loan Bank
Stock 1,325 1,325 1,325 Loans 84,073 85,436 98,343 Allowance
for loan and lease losses (2,787 ) (2,793 )
(2,985 ) Net loans 81,286 82,643 95,358
Property and equipment, net 4,656 4,716 4,883 Other real estate
owned - - 795 Other assets 4,253 4,244
4,304
Total assets $ 134,235 $ 133,415
$ 135,741
LIABILITIES AND EQUITY
Deposits Non-interest bearing deposits $ 35,457 $ 33,884 $ 29,360
Interest-bearing deposits 44,961 45,495 40,374 Savings account
deposits 7,460 6,875 5,537 Time certificates deposits 35,908
36,754 48,023
Total deposits 123,786 123,008 123,294 Liabilities Other
borrowings 3,032 3,061 5,144 Subordinated debentures 6,186 6,186
6,186 Other liabilities 2,436 2,328
2,299 Total liabilities 135,441 134,582
136,923 Shareholders' equity: Preferred stock 2,482 2,482
2,482 Common stock 8,611 8,611 8,611 Retained earnings (12,436 )
(12,449 ) (12,577 ) Accum. other comp. income 137
188 302 Total
shareholders' equity (1,206 ) (1,168 )
(1,182 ) Total
liabilities and equity $ 134,235 $ 133,415
$ 135,741
FINANCIAL RATIOS Loans /
deposits 66 % 67 % 77 % Non-performing loans / total loans 5.25 %
5.43 % 4.81 % Reserve / loans 3.31 % 3.27 % 3.03 %
Albina
Community Bancorp Income
Statement (Dollars in thousands, except per-share data)
Three Months Ended Six Months Ended June 30,
March 31, June 30, June 30,
2012 2012 2011 2012
2011 (unaudited) (unaudited) (unaudited) (unaudited)
(unaudited)
INTEREST INCOME Interest and fees on loans $
1,277 $ 1,465 $ 1,652 $ 2,742 $ 3,595 Interest on investment
securities 43 61 110 104 213 Other interest income 12
9 8 20
12 Total interest income 1,332 1,534 1,769
2,866 3,820
INTEREST EXPENSE Interest on deposits 130
160 270 290 564 Interest on borrowings 116
114 126 230
260 Total interest expense 246
274 395 520
824 -
NET INTEREST INCOME 1,086 1,260 1,374
2,346 2,996 Loan loss provision - 60
- 60 100
Net interest income after provision 1,086 1,200 1,374 2,286
2,896
NON-INTEREST INCOME Service charges and fees
150 152 148 301 288 Government payments and contracts - - - - -
Loan fees on brokered loans - - - - - Merchant & card
interchange income 121 110 108 231 206 Realized gain/(loss) on sale
of investment securities - - 3 - 3 Realized gain/(loss) on sale of
Loans & OREO - (34 ) 58 (34 ) 58 Realized (loss) on termination
of interest rate Swap - - - - - Other income 120
117 109 237
213 Total non-interest income 391 344 426 735
768
NON-INTEREST EXPENSE Salaries and employee
benefits 682 552 756 1,234 1,480 Occupancy and equipment 172 167
175 339 359 Legal and professional 116 199 185 314 417 Marketing 40
31 35 71 76 Data processing 195 182 189 377 384 Loan and OREO 24 71
108 95 114 FDIC assessment 111 111 168 222 279 Other 125
134 68 258
278 Total non-interest expense 1,465
1,447 1,684 2,912 3,387 -
PRETAX INCOME 12 98 116 110 277
Provision for income taxes - -
15 - 15
NET INCOME $ 12 $ 98 $
101 $ 110 $ 262 Earnings (loss)
per common share: Basic $ 0.01 $ 0.07 $ 0.08 $ 0.08 $ 0.20 Diluted
$ 0.01 $ 0.07 $ 0.08 $ 0.08 $ 0.20 Weighted average common
shares outstanding: Basic 1,073,310 1,073,310 1,073,310 1,073,133
1,073,133 Diluted 1,073,310 1,073,310 1,073,310 1,073,133 1,073,133
FINANCIAL RATIOS Return on average assets 0.04 % 0.30
% 0.29 % 0.17 % 0.37 % Efficiency ratio 99 % 90 % 94 % 94 % 90 %
Net interest margin 3.61 % 4.21 % 4.45 % 3.91 % 4.72 %
Albina
Community Bancorp
Selected Highlights (Dollars in thousands)
As of the Date
Ended (Certain loan balances have been reclassified
June
30, March 31, June 30, between categories in the
current period.)
2012 2012 2011
(unaudited) (unaudited) (unaudited)
Loans Commercial
business $ 17,004 20.2 % $ 19,631 23.0 % $ 20,075 20.4 % R/E
construction - 0.0 % - 0.0 % - 0.0 % Commercial R/E 47,151 56.1 %
46,971 55.0 % 50,553 51.4 % Multifamily residential 2,464 2.9 %
2,483 2.9 % 3,535 3.6 % One to four family residential 16,488 19.6
% 15,275 17.9 % 16,398 16.7 % Consumer 1,087 1.3 % 1,193 1.4 %
7,911 8.0 % Unearned Loan Fees (120 ) -0.1 % (117 )
-0.1 % (128 ) -0.1 % Total Loans 84,073 100.0 % 85,436 100.0
% 98,343 100.0 %
ASSET QUALITY Non-Performing
loans: Loans past due 90 days or more $ - $ - $ 74 Non-accrual
loans 4,411 4,643 4,660
Total non-performing loans 4,411 4,643 4,734 OREO -
- 795 Total non performing assets $
4,411 $ 4,643 $ 5,529 Non performing
assets / total assets 3.29 % 3.48 % 4.12 % Beginning
ALLL - from previous FYE 2,910 2,910 3,298 Provision for loan loss
expense 60 60 100 Loan charge offs (265 ) (233 ) (603 ) Loan
recoveries 82 56 189
(Charge offs), net of recoveries (183 ) (177 )
(413 ) Ending ALLL - YTD 2,787 2,793
2,985 Average Loans Quarter 84,806
91,018 100,480 YTD 87,851 91,018 106,362 Net charge-off Quarter 6
177 42 YTD 183 177 413 Net charge-offs (a) Quarter 0.03 % 0.78 %
0.17 % YTD 0.42 % 0.78 % 0.78 % (a) Annualized and calculated on
average loan balances Non-accrual loans Residential Real
Estate 2,516 2,607 2,581 Commercial Real Estate 1,814 1,950 2,012
Commercial/ Industrial 81 85 67
Total Non-accrual loans 4,411 4,642 4,660