FRANKLIN, N.J., April 28, 2010 (GLOBE NEWSWIRE) -- Sussex Bancorp (Nasdaq:SBBX) today announced its financial results for the first quarter ended March 31, 2010.
For the quarter ended March 31, 2010, the Company earned net income of $643 thousand, an increase of 154.2% from net income of $253 thousand for the first quarter of 2009. Basic and diluted earnings per share were $0.20 in the first quarter of 2010 compared to $0.08 for the first quarter of 2009. "We are encouraged by our first quarter results," said Anthony Labozzetta, Sussex's President and Chief Executive Officer. "With the continued strengthening of our core earnings and strong capital, we believe that we are well positioned to execute our community bank strategy of delivering an extraordinary experience for our customers while assisting with their financial needs," added Mr. Labozzetta.
The Company's net interest income increased $855 thousand, to $4.0 million for the quarter ended March 31, 2010 from $3.1 million for the first quarter of 2009. This, in large part, is a product of management's effort to reduce funding costs, which helped improve the Company's net interest margin by 81 basis points to 3.84% in the first quarter of 2010 as compared to the same period in 2009. The average rate paid on interest bearing liabilities declined 115 basis points to 1.57% in the first three months of 2010 compared to 2.72% in the same period one year earlier.
Excluding holding gains on trading securities, the Company's non-interest income decreased $132 thousand, or 10.1%, to $1.2 million for the quarter ended March 31, 2010 from $1.3 million for the first quarter of 2009. The decrease in non-interest income is attributable to lower insurance commissions and lower service charges on deposit accounts.
The Company's non-interest expenses remained unchanged at $3.5 million for the quarters ended March 31, 2010 and 2009. The Company incurred higher expenses for FDIC assessments and salary and benefits in the first quarter of 2010 as compared to the same period a year ago. Offsetting the overall impact of these items was a decrease in foreclosed real estate expenses and other expense savings resulting from cost control initiatives implemented during 2009. Maintaining non-interest expenses at the first quarter 2009 level, coupled with the increase in net interest income, resulted in a 12.1% decrease in the Company's efficiency ratio to 65.1% for the first three months of 2010 compared to the first quarter of 2009.
At March 31, 2010, non-performing assets, which include non-accrual loans and foreclosed real estate, increased $5.4 million, to $26.4 million compared to $21.0 million at December 31, 2009, as foreclosed real estate increased by $486 thousand and non-accrual loans increased $4.9 million. As a result of this increase in non-performing assets, the ratio of non-performing assets to total assets increased to 5.59% at March 31, 2010 from 4.61% at December 31, 2009. Mr. Labozzetta noted that the increase in nonperforming assets reflects, among other things, management's aggressive approach to identifying and resolving the Bank's troubled assets.
At March 31, 2010 the Company's total assets were $471.8 million, an increase of $17.0 million, or 3.7%, compared to total assets of $454.8 million at December 31, 2009. The Company's total deposits increased $16.0 million, or 4.3%, to $388.1 million at March 31, 2010 from $372.1 million at December 31, 2009. The growth in deposits was primarily in core deposits, as they increased $13.2 million and time deposits grew $2.8 million between the two periods. The Company's gross loans, net of unearned income decreased $3.2 million to $329.8 million at March 31, 2010 from $333.0 million at December 31, 2009. At March 31, 2010, the leverage capital, tier 1 capital to risk weighted assets and total capital to risk weighted assets ratios of Sussex Bank, the Company's bank subsidiary, were 9.03%, 12.13% and 13.38%, respectively, all in excess of the 5%, 6% and 10% ratios required to be deemed "well capitalized" under regulatory requirements.
Sussex Bancorp is the holding company for Sussex Bank, which operates through its main office in Franklin, New Jersey and branch offices in Andover, Augusta, Newton, Montague, Sparta, Vernon and Wantage, New Jersey, Port Jervis and Warwick, New York and for the Tri-State Insurance Agency, Inc., a full service insurance agency located in Sussex County, New Jersey.
| CONSOLIDATED BALANCE SHEETS | ||
| (Unaudited) | ||
| (Dollars in thousands, except share data) | March 31, 2010 | December 31, 2009 |
| ASSETS | ||
| Cash and due from banks | $15,694 | $8,779 |
| Federal funds sold | 25,705 | 14,300 |
| Cash and cash equivalents | 41,399 | 23,079 |
| Interest bearing time deposits with other banks | 600 | 100 |
| Trading securities | 2,573 | 2,955 |
| Securities available for sale | 73,761 | 71,315 |
| Federal Home Loan Bank Stock, at cost | 2,045 | 2,045 |
| Loans receivable, net of unearned income | 329,782 | 332,959 |
| Less: allowance for loan losses | 6,225 | 5,496 |
| Net loans receivable | 323,557 | 327,463 |
| Foreclosed real estate | 4,329 | 3,843 |
| Premises and equipment, net | 7,067 | 7,065 |
| Accrued interest receivable | 1,857 | 1,943 |
| Goodwill | 2,820 | 2,820 |
| Other assets | 11,753 | 12,213 |
| Total Assets | $471,761 | $454,841 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| Liabilities: | ||
| Deposits: | ||
| Non-interest bearing | $37,812 | $34,155 |
| Interest bearing | 350,259 | 337,920 |
| Total Deposits | 388,071 | 372,075 |
| Borrowings | 33,075 | 33,090 |
| Accrued interest payable and other liabilities | 2,408 | 2,262 |
| Junior subordinated debentures | 12,887 | 12,887 |
| Total Liabilities | 436,441 | 420,314 |
| Total Stockholders' Equity | 35,320 | 34,527 |
| Total Liabilities and Stockholders' Equity | $471,761 | $454,841 |
| SUSSEX BANCORP | ||
| CONSOLIDATED STATEMENTS OF INCOME | ||
| (Unaudited) | ||
| Three Months Ended March 31, | ||
| (Dollars in thousands) | 2010 | 2009 |
| INTEREST INCOME | ||
| Loans receivable, including fees | $4,680 | $4,808 |
| Securities: | ||
| Taxable | 514 | 627 |
| Tax-exempt | 263 | 273 |
| Federal funds sold | 7 | 12 |
| Interest bearing deposits | 2 | 7 |
| Total Interest Income | 5,466 | 5,727 |
| INTEREST EXPENSE | ||
| Deposits | 1,104 | 2,169 |
| Borrowings | 352 | 352 |
| Junior subordinated debentures | 53 | 104 |
| Total Interest Expense | 1,509 | 2,625 |
| Net Interest Income | 3,957 | 3,102 |
| PROVISION FOR LOAN LOSSES | 737 | 639 |
| Net Interest Income after Provision for Loan Losses | 3,220 | 2,463 |
| OTHER INCOME | ||
| Service fees on deposit accounts | 334 | 367 |
| ATM fees | 115 | 107 |
| Insurance commissions and fees | 547 | 614 |
| Investment brokerage fees | 60 | 47 |
| Holding gains on trading securities | 11 | 35 |
| Loss on sale of foreclosed real estate | 4 | (1) |
| Other | 110 | 168 |
| Total Other Income | 1,181 | 1,337 |
| OTHER EXPENSES | ||
| Salaries and employee benefits | 1,841 | 1,783 |
| Occupancy, net | 347 | 352 |
| Furniture, equipment and data processing | 299 | 340 |
| Stationary and supplies | 44 | 45 |
| Professional fees | 159 | 183 |
| Advertising and promotion | 51 | 59 |
| Insurance | 56 | 41 |
| FDIC Assessment | 224 | 150 |
| Postage and freight | 31 | 42 |
| Amortization of intangible assets | 4 | 5 |
| Write-down on foreclosed real estate | 29 | -- |
| Expenses related to foreclosed real estate | 69 | 183 |
| Other | 382 | 365 |
| Total Other Expenses | 3,536 | 3,548 |
| Income before Income Taxes | 865 | 252 |
| PROVISION (BENEFIT) FOR INCOME TAXES | 222 | (1) |
| Net Income | $643 | $253 |
| SUSSEX BANCORP | |||||||
| COMPARATIVE AVERAGE BALANCES AND AVERAGE INTEREST RATES | |||||||
| (Unaudited) | |||||||
| Three Months Ended March 31, | |||||||
| (Dollars in thousands) | 2010 | 2009 | |||||
| Average | Average | Average | Average | ||||
| Interest earning assets: | Balance | Interest (1) | Rate (2) | Balance | Interest (1) | Rate (2) | |
| Securities: | |||||||
| Tax exempt (3) | $26,817 | $394 | 5.96% | $26,709 | $408 | 6.19% | |
| Taxable | 48,949 | 514 | 4.26% | 56,817 | 627 | 4.48% | |
| Total securities | 75,766 | 908 | 4.86% | 83,526 | 1,035 | 5.02% | |
| Total loans receivable (4) | 330,709 | 4,680 | 5.74% | 322,535 | 4,808 | 6.05% | |
| Other interest-earning assets | 25,656 | 9 | 0.14% | 26,676 | 19 | 0.29% | |
| Total interest earning assets | 432,131 | $5,597 | 5.25% | 432,737 | $5,862 | 5.49% | |
| Non-interest earning assets | 37,836 | 34,491 | |||||
| Allowance for loan losses | (5,808) | (6,000) | |||||
| Total Assets | $464,159 | $461,228 | |||||
| Interest bearing liabilities: | |||||||
| Interest bearing deposits: | |||||||
| NOW | $61,623 | $143 | 0.94% | $57,897 | $159 | 1.11% | |
| Money market | 12,435 | 24 | 0.78% | 14,703 | 48 | 1.33% | |
| Savings | 167,546 | 494 | 1.20% | 159,739 | 1,026 | 2.61% | |
| Time | 103,096 | 443 | 1.74% | 112,901 | 936 | 3.36% | |
| Total interest bearing deposits | 344,699 | 1,104 | 1.30% | 345,240 | 2,169 | 2.55% | |
| Borrowed funds | 33,081 | 352 | 4.25% | 33,138 | 352 | 4.25% | |
| Junior subordinated debentures | 12,887 | 53 | 1.64% | 12,887 | 104 | 3.22% | |
| Total interest bearing liabilities | 390,667 | $1,509 | 1.57% | 391,265 | $2,625 | 2.72% | |
| Non-interest bearing liabilities: | |||||||
| Demand deposits | 36,840 | 36,479 | |||||
| Other liabilities | 1,705 | 1,261 | |||||
| Total non-interest bearing liabilities | 38,545 | 37,740 | |||||
| Stockholders' equity | 34,947 | 32,223 | |||||
| Total Liabilities and Stockholders' Equity | $464,159 | $461,228 | |||||
| Net Interest Income and Margin (5) | $4,088 | 3.84% | $3,237 | 3.03% | |||
| (1) Includes loan fee income | |||||||
| (2) Average rates on securities are calculated on amortized costs | |||||||
| (3) Full taxable equivalent basis, using a 39% effective tax rate and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act) interest expense disallowance | |||||||
| (4) Loans outstanding include non-accrual loans | |||||||
| (5) Represents the difference between interest earned and interest paid, divided by average total interest-earning assets | |||||||