FRANKLIN, N.J., Feb. 7, 2008 (PRIME NEWSWIRE) -- Sussex Bancorp (Nasdaq:SBBX) today announced its results of operations for the year ended December 31, 2007. For the year, the Company had net income of $1,509,000 compared to net income of $2,464,000 for the prior year, a decrease of 38.8%. Basic and diluted earnings per share for the year ended December 31, 2007 were $0.48 and $0.47, respectively, compared to $0.78 and $0.77 in the year ago period. The decline in net income reflects increased interest expense, non-interest expense and provision for loan losses exceeding increased interest and non-interest income.
The Company's total interest income increased to $22.8 million for the year ended December 31, 2007 from $20.0 million for the same period last year. For the year ended December 31, 2007, the Company's non-interest income increased by $372,000, or 7.1%, to $5.6 million from $5.2 million for the same period last year.
The Company's interest expense increased to $11.4 million for the year ended December 31, 2007 from $8.2 million for the same period last year. The increase reflects both an increase in the average volume of interest bearing liabilities to $304.1 million for 2007 from $254.2 million for 2006 and an increase in the cost of liabilities to 3.74% from 3.24% in 2006. The Company's total non-interest expense increased by $500,000, or 4.0%, reflecting increases associated with the Company's growth. At December 31, 2007 the Company had total loans of $300.6 million, compared to total loans of $262.3 million at December 31, 2006.
The Company's loan loss provision for the year ended December 31, 2007 increased to $1.9 million from $733,000 last year. The increase in the provision largely reflects a $1.1 million reserve for one non-accrual loan. The loan is secured by real estate in the process of build out as a residential development. In the current market, the value of the collateral has declined, leading to the increased reserve. The increased provision also reflects the increase in the Company's total loan portfolio and management's view of the risk inherent in the portfolio during a slowing economy.
During 2007, the Company's non-accrual loans increased to $12.3 million at December 31, 2007 from $6.8 million at September 30, 2007 and $1.4 million at year end 2006. The increase in non-accrual loans since third quarter 2007 primarily reflects the migration to non-accrual status of one loan with a principal balance of $3.3 million, which the Company had previously disclosed as performing but potentially troubled. The balance of the increase reflects a number of individual loans being placed on non-accrual status, all of which the Company believes are adequately secured.
At December 31, 2007 the Company had total assets of $393.5 million, compared to total assets of $356.3 million at December 31, 2006. In addition, the Company had total deposits of $308.5 million at December 31, 2007, compared to total deposits of $295.8 million at December 31, 2006.
Sussex Bancorp is the holding company for the Sussex Bank, which operates through ten branch offices, eight located in Sussex County, New Jersey and two in Orange County, New York, and for Tri-State Insurance Agency, Inc, a full service insurance agency located in Sussex County, New Jersey.
SUSSEX BANCORP
CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)
Dec. 31, Dec. 31,
ASSETS 2007 2006
------ ------------------
Cash and due from banks $ 7,985 $ 10,170
Federal funds sold 3,790 11,995
-------- --------
Cash and cash equivalents 11,775 22,165
Interest bearing time deposits with other banks 100 100
Trading securities 14,259 --
Securities available for sale 48,397 54,635
Federal Home Loan Bank Stock, at cost 2,032 1,188
Loans receivable, net of unearned income 300,646 262,276
Less: allowance for loan losses 5,140 3,340
-------- --------
Net loans receivable 295,506 258,936
Premises and equipment, net 9,112 7,794
Accrued interest receivable 2,035 1,910
Goodwill 2,820 2,820
Other assets 7,496 6,749
-------- --------
Total Assets $393,532 $356,297
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LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Liabilities:
Deposits:
Non-interest bearing $ 36,625 $ 40,083
Interest bearing 271,913 255,687
-------- --------
Total Deposits 308,538 295,770
Borrowings 35,200 18,251
Accrued interest payable and other liabilities 2,467 2,529
Junior subordinated debentures 12,887 5,155
-------- --------
Total Liabilities 359,092 321,705
Total Stockholders' Equity 34,440 34,592
-------- --------
Total Liabilities and Stockholders' Equity $393,532 $356,297
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SUSSEX BANCORP
CONSOLIDATED STATEMENTS OF INCOME
(Dollars In Thousands Except Per Share Data)
Years Ended
December 31,
------------------
2007 2006
-------- --------
INTEREST INCOME
Loans receivable, including fees $ 19,524 $ 17,009
Securities:
Taxable 1,696 1,455
Tax-exempt 1,014 1,032
Federal funds sold 569 490
Interest bearing deposits 5 12
-------- --------
Total Interest Income 22,808 19,998
-------- --------
INTEREST EXPENSE
Deposits 9,734 7,097
Borrowings 966 707
Junior subordinated debentures 687 445
-------- --------
Total Interest Expense 11,387 8,249
-------- --------
Net Interest Income 11,421 11,749
PROVISION FOR LOAN LOSSES 1,930 733
-------- --------
Net Interest Income after
Provision for Loan Losses 9,491 11,016
-------- --------
OTHER INCOME
Service fees on deposit accounts 1,396 1,370
ATM fees 412 374
Insurance commissions and fees 2,688 2,576
Investment brokerage fees 282 265
Holding gains on trading securities 258 --
Gain on sale of securities, available for sale 10 90
Other 570 569
-------- --------
Total Other Income 5,616 5,244
-------- --------
OTHER EXPENSES
Salaries and employee benefits 7,153 6,872
Occupancy, net 1,246 1,077
Furniture, equipment and data processing 1,462 1,210
Stationary and supplies 187 199
Professional fees 599 668
Advertising and promotion 556 518
Insurance 176 197
Postage and freight 167 208
Amortization of intangible assets 93 150
Other 1,509 1,549
-------- --------
Total Other Expenses 13,148 12,648
-------- --------
Income before Income Taxes 2,409 3,612
PROVISION FOR INCOME TAXES 450 1,148
-------- --------
Net Income $ 1,509 $ 2,464
======== ========
SUSSEX BANCORP
COMPARATIVE AVERAGE BALANCES AND AVERAGE INTEREST RATES
(Dollars In Thousands)
(Unaudited)
(dollars in Twelve Months Ended December 31,
thousands) 2007 2006
------------------------------------------- -------------------------
Average Interest Average Average Interest Average
Earning Assets: Balance (a) Rate (b) Balance (a) Rate (b)
-----------------------------------------------------
Securities:
Tax exempt (c) $ 24,033 $ 1,317 5.48% $ 24,018 $ 1,383 5.76%
Taxable 35,214 1,696 4.82% 35,687 1,455 4.08%
----------------------------------------------------
Total securities 59,247 3,013 5.09% 59,705 2,838 4.75%
Total loans
receivable (d) 283,346 19,524 6.89% 239,831 17,009 7.09%
Other
interest-earning
assets 11,603 574 4.95% 10,244 502 4.90%
----------------------------------------------------
Total earning
assets 354,196 $ 23,111 6.52% 309,780 $ 20,349 6.57%
Non-interest
earning assets 28,738 26,126
Allowance for
loan losses (3,779) (2,994)
-------- --------
Total Assets $379,155 $332,912
======== ========
Sources of Funds:
Interest bearing
deposits:
NOW $ 60,377 $ 1,282 2.12% $ 57,974 $ 1,306 2.25%
Money market 37,317 1,378 3.69% 30,773 1,200 3.90%
Savings 38,142 348 0.91% 45,916 401 0.87%
Time 138,633 6,726 4.85% 100,061 4,190 4.19%
----------------------------------------------------
Total interest
bearing
deposits 274,469 9,734 3.55% 234,724 7,097 3.02%
Borrowed funds 20,397 966 4.74% 14,359 707 4.92%
Junior
subordinated
debentures 9,271 687 7.41% 5,155 445 8.63%
----------------------------------------------------
Total interest
bearing
liabilities 304,137 $ 11,387 3.74% 254,238 $ 8,249 3.24%
Non-interest
bearing
liabilities:
Demand deposits 37,663 43,036
Other
liabilities 2,309 1,928
-------- --------
Total
non-interest
bearing
liabilities 39,972 44,964
Stockholders'
equity 35,046 33,710
-------- --------
Total Liabilities
and
Stockholders'
Equity $379,155 $332,912
======== ========
--------------- ---------------
Net Interest
Income and
Margin (e) $ 11,724 3.31% $ 12,100 3.91%
=============== ===============
(a) Includes loan fee income
(b) Average rates on securities are calculated on amortized costs
(c) Full taxable equivalent basis, using a 39% effective tax rate
and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act)
interest expense disallowance
(d) Loans outstanding include non-accrual loans
(e) Represents the difference between interest earned and interest
paid, divided by average total interest-earning assets