CLINTON, N.J., April 22, 2015 (GLOBE NEWSWIRE) -- Unity Bancorp, Inc. (Nasdaq:UNTY), parent company of Unity Bank, reported net income of $1.9 million, or $0.23 per diluted share, for the three months ended March 31, 2015, a 50.0% increase compared to net income of $1.3 million, or $0.17 per diluted share, for the same period a year ago. Return on average assets and average common equity for the quarter were 0.82% and 11.08%, respectively, compared to 0.59% and 9.06% for the same period a year ago.
Highlights include:
- 3.0% loan growth since year-end 2014 – 6.6% growth in residential mortgage loans, 5.8% growth in consumer loans and 2.2% growth in commercial loans.
- 10.1% increase in net interest income compared to the prior year's quarter due to strong loan growth.
- Net interest margin of 3.64% this quarter compared to 3.57% in the prior year's quarter.
- Improved credit quality metrics and reduced loan loss provision - 24.1% decrease in nonperforming loans and lower level of net charge-offs compared to the prior year's quarter.
"Our continued earnings momentum is a direct result of our commitment to providing exceptional service to our customers," reported James A. Hughes, President and CEO. "We are realizing record loan volume, as all of our loan departments are exceeding their goals. I have never been more confident about our ability to continue to grow market share, which in turn will result in increased shareholder value. I know this year will be a defining year for Unity, as we continue to build an organization that focuses on service and sales. I look forward to reporting our future successes."
Net Interest Income
Our core source of earnings, net interest income, increased $733 thousand to $8.0 million for the quarter ended March 31, 2015 compared to the prior year's period. This increase was the result of the strong loan growth over the past twelve months in commercial, residential mortgage and consumer loans. Quarterly average residential mortgage loans have increased $45.1 million, average commercial loans increased $41.8 million and consumer loans increased $16.4 million compared to the comparable quarter in 2014. Partially offsetting this increase was the lower level of interest income due to our smaller investment portfolio and the increase in deposit interest expense.
The net interest margin increased 7 basis points to 3.64% for the quarter ended March 31, 2015 compared to 3.57% for the prior year's quarter. We expect net interest income and net interest margin to continue to expand in future quarters due to strong loan growth.
Provision for Loan Losses
The provision for loan losses decreased $400 thousand to $200 thousand for the quarter ended March 31, 2015, compared to $600 thousand for the prior year period. The decrease was the result of improving credit quality as evidenced by lower levels of net charge-offs and reduced nonperforming assets.
Noninterest Income
Noninterest income increased $115 thousand to $1.6 million for the three months ended March 31, 2015, compared to the same period last year. Quarterly noninterest income increased due to higher gains on the sale of SBA loans. SBA loan sales totaled $3.5 million with net gains on sale of $363 thousand this quarter compared to sales of $928 thousand and net gains of $83 thousand in the prior year's quarter.
Quarterly gains on the sale of mortgage loans decreased slightly on a lower sales volume. During the quarter, $37.1 million in residential mortgage loans were originated, of which $15.0 million were sold at a gain of $344 thousand, compared to $22.2 million originated and $17.4 million sold at a gain of $365 thousand during the prior year's quarter. Approximately $7.5 million of the loans sold during the first quarter 2014 were from our portfolio, with the remainder consisting of new production.
Security gains totaled $110 thousand for the prior year's quarter. There were no security gains or losses on sales realized during the quarter.
Branch fee income, which consists of service charges and overdraft fees, declined $31 thousand in the quarter. The decreases were due to a lower volume of overdraft fees.
Noninterest Expense
Noninterest expense increased $244 thousand to $6.5 million for the quarter ended March 31, 2015. Compensation and benefits expenses have increased over the past twelve months due to increased head count in loan origination and support staff. Other expense increases included professional services, advertising, marketing agreements and promotional gift expense as well as director fees. Other real estate owned ("OREO") expenses decreased $212 thousand this quarter compared to a year ago due to the disposition of properties which had higher holding costs such as property maintenance, taxes and legal costs in the prior year's period.
Financial Condition
At March 31, 2015, total assets were $1.0 billion, an increase of $26.6 million from year-end 2014:
- Total loans increased $22.8 million or 3.0%, from year-end 2014 to $784.6 million at March 31, 2015. The majority of the growth came in our residential mortgage, commercial and consumer loan portfolios which increased $14.5 million, $8.8 million and $3.5 million, respectively.
- Total deposits decreased $4.9 million or 0.6%, to $789.4 million at March 31, 2015, due primarily to decreased savings, interest-bearing demand and time deposits, partially offset by an increase in noninterest-bearing demand deposits. The decreased savings and interest-bearing demand deposit balances were due to seasonal reductions in municipal deposits.
- Shareholders' equity was $72.0 million at March 31, 2015, an increase of $1.9 million from year-end 2014, due to year-to-date net income less the dividends paid.
- Book value per common share was $8.55 as of March 31, 2015.
- At March 31, 2015, the leverage, common equity Tier I, Tier I and Total Risk Based Capital ratios were 8.93%, 9.25, 11.22% and 12.48% respectively, all in excess of the ratios required to be deemed "well-capitalized".
Credit Quality
- Nonperforming assets totaled $11.1 million at March 31, 2015, or 1.41% of total loans and OREO, compared to $12.5 million or 1.64% of total loans and OREO at year-end 2014.
- Nonperforming loans decreased 19.6% to $9.1 million at March 31, 2015 from year-end.
- OREO increased $813 thousand to $2.0 million at March 31, 2015 from year-end.
- The allowance for loan losses totaled $12.2 million at March 31, 2015, or 1.55% of total loans compared to $12.6 million and 1.65% at December 31, 2014.
- Net charge-offs were $570 thousand for the three months ended March 31, 2015, down from $934 thousand for the same period a year ago.
Unity Bancorp, Inc. is a financial service organization headquartered in Clinton, New Jersey, with approximately $1.0 billion in assets and $789 million in deposits. Unity Bank provides financial services to retail, corporate and small business customers through its 15 retail service centers located in Hunterdon, Middlesex, Somerset, Union and Warren Counties in New Jersey and Northampton County, Pennsylvania. For additional information about Unity, visit our website at www.unitybank.com, or call 800-618-BANK.
This news release contains certain forward-looking statements, either expressed or implied, which are provided to assist the reader in understanding anticipated future financial performance. These statements may be identified by use of the words "believe", "expect", "intend", "anticipate", "estimate", "project" or similar expressions. These statements involve certain risks, uncertainties, estimates and assumptions made by management, which are subject to factors beyond the company's control and could impede its ability to achieve these goals. These factors include those items included in our Annual Report on Form 10-K under the heading "Item IA-Risk Factors" as well as general economic conditions, trends in interest rates, the ability of our borrowers to repay their loans, our ability to manage and reduce the level of our nonperforming assets, and results of regulatory exams, among other factors.
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.
| UNITY BANCORP, INC. | |||||
| SUMMARY FINANCIAL HIGHLIGHTS | |||||
| March 31, 2015 | |||||
| March 31, 2015 vs. | |||||
| December 31, 2014 | March 31, 2014 | ||||
| (In thousands, except percentages and per share amounts) | March 31, 2015 | December 31, 2014 | March 31, 2014 | % | % |
| BALANCE SHEET DATA: | |||||
| Total assets | $ 1,035,404 | $ 1,008,788 | $ 961,168 | 2.6 % | 7.7 % |
| Total deposits | 789,441 | 794,341 | 767,624 | (0.6) | 2.8 |
| Total loans | 784,642 | 761,825 | 683,951 | 3.0 | 14.7 |
| Total securities | 77,308 | 80,082 | 109,459 | (3.5) | (29.4) |
| Total shareholders' equity | 71,987 | 70,123 | 58,810 | 2.7 | 22.4 |
| Allowance for loan losses | (12,181) | (12,551) | (12,807) | (2.9) | (4.9) |
| FINANCIAL DATA - QUARTER TO DATE: | |||||
| Income before provision for income taxes | $ 2,959 | $ 2,653 | $ 1,955 | 11.5 | 51.4 |
| Provision for income taxes | 1,020 | 952 | 662 | 7.1 | 54.1 |
| Net income | $ 1,939 | $ 1,701 | $ 1,293 | 14.0 | 50.0 |
| Net income per common share - Basic (1) | $ 0.23 | $ 0.21 | $ 0.17 | 15.0 | 35.3 |
| Net income per common share - Diluted (1) | $ 0.23 | $ 0.20 | $ 0.17 | 15.0 | 35.3 |
| Return on average assets | 0.82 % | 0.70 % | 0.59 % | 17.1 | 39.0 |
| Return on average equity (2) | 11.08 % | 9.78 % | 9.06 % | 13.3 | 22.3 |
| Efficiency ratio | 67.30 % | 63.68 % | 71.91 % | 5.7 | (6.4) |
| SHARE INFORMATION: | |||||
| Market price per share | $ 9.08 | $ 9.43 | $ 7.95 | (3.7) | 14.2 |
| Dividends paid | $ 0.03 | $ 0.03 | $ 0.02 | -- | 0.5 |
| Book value per common share | $ 8.55 | $ 8.36 | $ 7.74 | 2.3 | 10.5 |
| Average diluted shares outstanding (QTD) | 8,514 | 8,478 | 7,654 | 0.4 | 11.2 |
| CAPITAL RATIOS: | |||||
| Total equity to total assets | 6.95 % | 6.95 % | 6.12 % | -- | 13.6 |
| Leverage ratio | 8.93 % | 8.71 % | 8.19 % | 2.5 | 9.0 |
| Common equity tier 1 risk-based capital ratio | 9.25 % | n/a | n/a | n/a | n/a |
| Tier 1 risk-based capital ratio | 11.22 % | 11.57 % | 10.77 % | (3.0) | 4.2 |
| Total risk-based capital ratio | 12.48 % | 12.83 % | 12.03 % | (2.7) | 3.7 |
| CREDIT QUALITY AND RATIOS: | |||||
| Nonperforming assets | $ 11,116 | $ 12,530 | $ 14,513 | (11.3) | (23.4) |
| QTD net chargeoffs (annualized) to QTD average loans | 0.30 % | 0.63 % | 0.56 % | (52.4) | (46.4) |
| Allowance for loan losses to total loans | 1.55 % | 1.65 % | 1.87 % | (6.1) | (17.1) |
| Nonperforming assets to total loans and OREO | 1.41 % | 1.64 % | 2.11 % | (14.0) | (33.2) |
| Nonperforming assets to total assets | 1.07 % | 1.24 % | 1.51 % | (13.7) % | (29.1) % |
| (1) Defined as net income adjusted for dividends accrued and accretion of discount on perpetual preferred stock divided by weighted average shares outstanding. | |||||
| (2) Defined as net income adjusted for dividends accrued and accretion of discount on perpetual preferred stock divided by average shareholders' equity (excluding preferred stock). | |||||
| UNITY BANCORP, INC. | |||||
| CONSOLIDATED BALANCE SHEETS | |||||
| March 31, 2015 | |||||
| March 31, 2015 vs. | |||||
| December 31, 2014 | March 31, 2014 | ||||
| (In thousands, except percentages) | March 31, 2015 | December 31, 2014 | March 31, 2014 | % | % |
| ASSETS | |||||
| Cash and due from banks | $ 25,282 | $ 29,351 | $ 30,025 | (13.9) % | (15.8) % |
| Federal funds sold and interest-bearing deposits | 108,563 | 100,470 | 98,188 | 8.1 | 10.6 |
| Cash and cash equivalents | 133,845 | 129,821 | 128,213 | 3.1 | 4.4 |
| Securities: | |||||
| Securities available for sale | 57,875 | 60,073 | 86,154 | (3.7) | (32.8) |
| Securities held to maturity | 19,433 | 20,009 | 23,305 | (2.9) | (16.6) |
| Total securities | 77,308 | 80,082 | 109,459 | (3.5) | (29.4) |
| Loans: | |||||
| SBA loans held for sale | 6,929 | 5,179 | 6,517 | 33.8 | 6.3 |
| SBA loans held for investment | 39,155 | 40,401 | 47,737 | (3.1) | (18.0) |
| SBA 504 loans | 29,893 | 34,322 | 33,550 | (12.9) | (10.9) |
| Commercial loans | 410,742 | 401,949 | 368,909 | 2.2 | 11.3 |
| Residential mortgage loans | 235,371 | 220,878 | 180,129 | 6.6 | 30.7 |
| Consumer loans | 62,552 | 59,096 | 47,109 | 5.8 | 32.8 |
| Total loans | 784,642 | 761,825 | 683,951 | 3.0 | 14.7 |
| Allowance for loan losses | (12,181) | (12,551) | (12,807) | 2.9 | 4.9 |
| Net loans | 772,461 | 749,274 | 671,144 | 3.1 | 15.1 |
| Premises and equipment, net | 15,465 | 15,231 | 15,474 | 1.5 | (0.1) |
| Bank owned life insurance ("BOLI") | 13,095 | 13,001 | 12,845 | 0.7 | 1.9 |
| Deferred tax assets | 5,743 | 5,860 | 6,308 | (2.0) | (9.0) |
| Federal Home Loan Bank stock | 7,382 | 6,032 | 5,752 | 22.4 | 28.3 |
| Accrued interest receivable | 3,637 | 3,518 | 3,212 | 3.4 | 13.2 |
| Other real estate owned ("OREO") | 1,975 | 1,162 | 2,467 | 70.0 | (19.9) |
| Goodwill and other intangibles | 1,516 | 1,516 | 1,516 | -- | -- |
| Other assets | 2,977 | 3,291 | 4,778 | (9.5) | (37.7) |
| Total assets | $ 1,035,404 | $ 1,008,788 | $ 961,168 | 2.6 % | 7.7 % |
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||
| Liabilities: | |||||
| Deposits: | |||||
| Noninterest-bearing demand deposits | $ 163,535 | $ 152,785 | $ 172,010 | 7.0 % | (4.9) % |
| Interest-bearing demand deposits | 124,110 | 128,875 | 134,321 | (3.7) | (7.6) |
| Savings deposits | 290,843 | 300,348 | 253,109 | (3.2) | 14.9 |
| Time deposits, under $100,000 | 112,671 | 113,119 | 112,150 | (0.4) | 0.5 |
| Time deposits, $100,000 and over | 98,282 | 99,214 | 96,034 | (0.9) | 2.3 |
| Total deposits | 789,441 | 794,341 | 767,624 | (0.6) | 2.8 |
| Borrowed funds | 155,000 | 125,000 | 115,000 | 24.0 | 34.8 |
| Subordinated debentures | 15,465 | 15,465 | 15,465 | -- | -- |
| Accrued interest payable | 478 | 474 | 455 | 0.8 | 5.1 |
| Accrued expenses and other liabilities | 3,033 | 3,385 | 3,814 | (10.4) | (20.5) |
| Total liabilities | 963,417 | 938,665 | 902,358 | 2.6 | 6.8 |
| Shareholders' equity: | |||||
| Common stock | 58,927 | 58,785 | 52,237 | 0.2 | 12.8 |
| Retained earnings | 12,880 | 11,195 | 6,739 | 15.1 | 91.3 |
| Accumulated other comprehensive income (loss) | 180 | 143 | (166) | 25.9 | 208.4 |
| Total shareholders' equity | 71,987 | 70,123 | 58,810 | 2.7 | 22.4 |
| Total liabilities and shareholders' equity | $ 1,035,404 | $ 1,008,788 | $ 961,168 | 2.6 % | 7.7 % |
| Issued and outstanding common shares | 8,423 | 8,388 | 7,602 | ||
| UNITY BANCORP, INC. | |||||||||||
| QTD CONSOLIDATED STATEMENTS OF INCOME | |||||||||||
| March 31, 2015 | |||||||||||
| March 31, 2015 vs. | |||||||||||
| For the three months ended | December 31, 2014 | March 31, 2014 | |||||||||
| (In thousands, except percentages and per share amounts) | March 31, 2015 | December 31, 2014 | March 31, 2014 | $ | % | $ | % | ||||
| INTEREST INCOME | |||||||||||
| Federal funds sold and interest-bearing deposits | $ 9 | $ 13 | $ 9 | $ (4) | (30.8) % | $ -- | -- % | ||||
| Federal Home Loan Bank stock | 44 | 38 | 47 | 6 | 15.8 | (3) | (6.4) | ||||
| Securities: | |||||||||||
| Taxable | 387 | 444 | 726 | (57) | (12.8) | (339) | (46.7) | ||||
| Tax-exempt | 72 | 79 | 105 | (7) | (8.9) | (33) | (31.4) | ||||
| Total securities | 459 | 523 | 831 | (64) | (12.2) | (372) | (44.8) | ||||
| Loans: | |||||||||||
| SBA loans | 679 | 605 | 583 | 74 | 12.2 | 96 | 16.5 | ||||
| SBA 504 loans | 346 | 425 | 399 | (79) | (18.6) | (53) | (13.3) | ||||
| Commercial loans | 5,066 | 5,064 | 4,601 | 2 | -- | 465 | 10.1 | ||||
| Residential mortgage loans | 2,582 | 2,461 | 2,058 | 121 | 4.9 | 524 | 25.5 | ||||
| Consumer loans | 699 | 673 | 495 | 26 | 3.9 | 204 | 41.2 | ||||
| Total loans | 9,372 | 9,228 | 8,136 | 144 | 1.6 | 1,236 | 15.2 | ||||
| Total interest income | 9,884 | 9,802 | 9,023 | 82 | 0.8 | 861 | 9.5 | ||||
| INTEREST EXPENSE | |||||||||||
| Interest-bearing demand deposits | 106 | 112 | 111 | (6) | (5.4) | (5) | (4.5) | ||||
| Savings deposits | 264 | 270 | 182 | (6) | (2.2) | 82 | 45.1 | ||||
| Time deposits | 686 | 715 | 644 | (29) | (4.1) | 42 | 6.5 | ||||
| Borrowed funds and subordinated debentures | 808 | 817 | 799 | (9) | (1.1) | 9 | 1.1 | ||||
| Total interest expense | 1,864 | 1,914 | 1,736 | (50) | (2.6) | 128 | 7.4 | ||||
| Net interest income | 8,020 | 7,888 | 7,287 | 132 | 1.7 | 733 | 10.1 | ||||
| Provision for loan losses | 200 | 850 | 600 | (650) | (76.5) | (400) | (66.7) | ||||
| Net interest income after provision for loan losses | 7,820 | 7,038 | 6,687 | 782 | 11.1 | 1,133 | 16.9 | ||||
| NONINTEREST INCOME | |||||||||||
| Branch fee income | 346 | 362 | 377 | (16) | (4.4) | (31) | (8.2) | ||||
| Service and loan fee income | 296 | 388 | 295 | (92) | (23.7) | 1 | 0.3 | ||||
| Gain on sale of SBA loans held for sale, net | 363 | 342 | 83 | 21 | 6.1 | 280 | 337.3 | ||||
| Gain on sale of mortgage loans, net | 344 | 323 | 365 | 21 | 6.5 | (21) | (5.8) | ||||
| Net security gains | -- | 55 | 110 | (55) | (100.0) | (110) | (100.0) | ||||
| Other income | 292 | 190 | 296 | 102 | 53.7 | (4) | (1.4) | ||||
| Total noninterest income | 1,641 | 1,660 | 1,526 | (19) | (1.1) | 115 | 7.5 | ||||
| NONINTEREST EXPENSE | |||||||||||
| Compensation and benefits | 3,472 | 3,197 | 3,217 | 275 | 8.6 | 255 | 7.9 | ||||
| Occupancy | 672 | 596 | 659 | 76 | 12.8 | 13 | 2.0 | ||||
| Processing and communications | 596 | 615 | 582 | (19) | (3.1) | 14 | 2.4 | ||||
| Furniture and equipment | 373 | 397 | 357 | (24) | (6.0) | 16 | 4.5 | ||||
| Professional services | 236 | 131 | 211 | 105 | 80.2 | 25 | 11.8 | ||||
| Loan costs | 221 | 211 | 170 | 10 | 4.7 | 51 | 30.0 | ||||
| OREO expenses | 35 | 72 | 247 | (37) | (51.4) | (212) | (85.8) | ||||
| Deposit insurance | 183 | 162 | 178 | 21 | 13.0 | 5 | 2.8 | ||||
| Advertising | 182 | 269 | 151 | (87) | (32.3) | 31 | 20.5 | ||||
| Other expenses | 532 | 395 | 486 | 137 | 34.7 | 46 | 9.5 | ||||
| Total noninterest expense | 6,502 | 6,045 | 6,258 | 457 | 7.6 | 244 | 3.9 | ||||
| Income before provision for income taxes | 2,959 | 2,653 | 1,955 | 306 | 11.5 | 1,004 | 51.4 | ||||
| Provision for income taxes | 1,020 | 952 | 662 | 68 | 7.1 | 358 | 54.1 | ||||
| Net income | $ 1,939 | $ 1,701 | $ 1,293 | $ 238 | 14.0 % | $ 646 | 50.0 % | ||||
| Effective tax rate | 34.5 % | 35.9 % | 33.9 % | ||||||||
| Net income per common share - Basic (1) | $ 0.23 | $ 0.21 | $ 0.17 | ||||||||
| Net income per common share - Diluted (1) | $ 0.23 | $ 0.20 | $ 0.17 | ||||||||
| Weighted average common shares outstanding - Basic | 8,417 | 8,378 | 7,586 | ||||||||
| Weighted average common shares outstanding - Diluted | 8,514 | 8,478 | 7,654 | ||||||||
| (1) Defined as net income adjusted for dividends accrued and accretion of discount on perpetual preferred stock divided by weighted average shares outstanding. | |||||||||||
| UNITY BANCORP, INC. | ||||||||||||
| QUARTER TO DATE NET INTEREST MARGIN | ||||||||||||
| March 31, 2015 | ||||||||||||
| (Dollar amounts in thousands, interest amounts and interest rates/yields on a fully tax-equivalent basis) | ||||||||||||
| For the three months ended | ||||||||||||
| March 31, 2015 | December 31, 2014 | |||||||||||
| Average Balance | Interest | Rate/Yield | Average Balance | Interest | Rate/Yield | |||||||
| ASSETS | ||||||||||||
| Interest-earning assets: | ||||||||||||
| Federal funds sold and interest-bearing deposits | $ 37,280 | $ 9 | 0.10 % | $ 50,929 | $ 13 | 0.10 % | ||||||
| Federal Home Loan Bank stock | 3,847 | 44 | 4.64 | 3,807 | 38 | 3.96 | ||||||
| Securities: | ||||||||||||
| Taxable | 67,046 | 387 | 2.34 | 71,542 | 444 | 2.48 | ||||||
| Tax-exempt | 11,984 | 106 | 3.59 | 13,226 | 117 | 3.54 | ||||||
| Total securities (A) | 79,030 | 493 | 2.53 | 84,768 | 561 | 2.65 | ||||||
| Loans: | ||||||||||||
| SBA loans | 48,405 | 679 | 5.69 | 50,816 | 605 | 4.76 | ||||||
| SBA 504 loans | 33,397 | 346 | 4.20 | 34,533 | 425 | 4.88 | ||||||
| Commercial loans | 406,095 | 5,066 | 5.06 | 401,215 | 5,064 | 5.01 | ||||||
| Residential mortgage loans | 226,125 | 2,582 | 4.63 | 217,008 | 2,461 | 4.54 | ||||||
| Consumer loans | 62,355 | 699 | 4.55 | 57,923 | 673 | 4.61 | ||||||
| Total loans (B) | 776,377 | 9,372 | 4.90 | 761,495 | 9,228 | 4.82 | ||||||
| Total interest-earning assets | $ 896,534 | $ 9,918 | 4.49 % | $ 900,999 | $ 9,840 | 4.35 % | ||||||
| Noninterest-earning assets: | ||||||||||||
| Cash and due from banks | 29,908 | 30,346 | ||||||||||
| Allowance for loan losses | (12,701) | (13,074) | ||||||||||
| Other assets | 43,206 | 43,577 | ||||||||||
| Total noninterest-earning assets | 60,413 | 60,849 | ||||||||||
| Total assets | $ 956,947 | $ 961,848 | ||||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||
| Interest-bearing liabilities: | ||||||||||||
| Interest-bearing demand deposits | $ 126,593 | $ 106 | 0.34 % | $ 126,788 | $ 112 | 0.35 % | ||||||
| Savings deposits | 290,006 | 264 | 0.37 | 298,166 | 270 | 0.36 | ||||||
| Time deposits | 211,425 | 686 | 1.32 | 219,866 | 715 | 1.29 | ||||||
| Total interest-bearing deposits | 628,024 | 1,056 | 0.68 | 644,820 | 1,097 | 0.68 | ||||||
| Borrowed funds and subordinated debentures | 91,909 | 808 | 3.57 | 91,009 | 817 | 3.51 | ||||||
| Total interest-bearing liabilities | $ 719,933 | $ 1,864 | 1.05 % | $ 735,829 | $ 1,914 | 1.03 % | ||||||
| Noninterest-bearing liabilities: | ||||||||||||
| Noninterest-bearing demand deposits | 161,729 | 152,359 | ||||||||||
| Other liabilities | 4,307 | 4,616 | ||||||||||
| Total noninterest-bearing liabilities | 166,036 | 156,975 | ||||||||||
| Total shareholders' equity | 70,978 | 69,044 | ||||||||||
| Total liabilities and shareholders' equity | $ 956,947 | $ 961,848 | ||||||||||
| Net interest spread | $ 8,054 | 3.44 % | $ 7,926 | 3.32 % | ||||||||
| Tax-equivalent basis adjustment | (34) | (38) | ||||||||||
| Net interest income | $ 8,020 | $ 7,888 | ||||||||||
| Net interest margin | 3.64 % | 3.49 % | ||||||||||
|
(A) Yields related to securities exempt from federal and state income taxes are stated on a fully tax-equivalent basis. They are reduced by the nondeductible portion of interest expense, assuming a federal tax rate of 34 percent and applicable state rates. |
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| (B) The loan averages are stated net of unearned income, and the averages include loans on which the accrual of interest has been discontinued. | ||||||||||||
| UNITY BANCORP, INC. | ||||||
| QUARTER TO DATE NET INTEREST MARGIN | ||||||
| March 31, 2015 | ||||||
| (Dollar amounts in thousands, interest amounts and interest rates/yields on a fully tax-equivalent basis) | ||||||
| For the three months ended | ||||||
| March 31, 2015 | March 31, 2014 | |||||
| Average Balance | Interest | Rate/Yield | Average Balance | Interest | Rate/Yield | |
| ASSETS | ||||||
| Interest-earning assets: | ||||||
| Federal funds sold and interest-bearing deposits | $ 37,280 | $ 9 | 0.10 % | $ 42,029 | $ 9 | 0.09 % |
| Federal Home Loan Bank stock | 3,847 | 44 | 4.64 | 3,988 | 47 | 4.78 |
| Securities: | ||||||
| Taxable | 67,046 | 387 | 2.34 | 92,808 | 726 | 3.13 |
| Tax-exempt | 11,984 | 106 | 3.59 | 16,841 | 155 | 3.68 |
| Total securities (A) | 79,030 | 493 | 2.53 | 109,649 | 881 | 3.21 |
| Loans: | ||||||
| SBA loans | 48,405 | 679 | 5.69 | 54,790 | 583 | 4.26 |
| SBA 504 loans | 33,397 | 346 | 4.20 | 31,719 | 399 | 5.10 |
| Commercial loans | 406,095 | 5,066 | 5.06 | 364,343 | 4,601 | 5.12 |
| Residential mortgage loans | 226,125 | 2,582 | 4.63 | 181,058 | 2,058 | 4.55 |
| Consumer loans | 62,355 | 699 | 4.55 | 45,939 | 495 | 4.37 |
| Total loans (B) | 776,377 | 9,372 | 4.90 | 677,849 | 8,136 | 4.85 |
| Total interest-earning assets | $ 896,534 | $ 9,918 | 4.49 % | $ 833,515 | $ 9,073 | 4.39 % |
| Noninterest-earning assets: | ||||||
| Cash and due from banks | 29,908 | 23,389 | ||||
| Allowance for loan losses | (12,701) | (13,410) | ||||
| Other assets | 43,206 | 43,599 | ||||
| Total noninterest-earning assets | 60,413 | 53,578 | ||||
| Total assets | $ 956,947 | $ 887,093 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||
| Interest-bearing liabilities: | ||||||
| Interest-bearing demand deposits | $ 126,593 | $ 106 | 0.34 % | $ 131,187 | $ 111 | 0.34 % |
| Savings deposits | 290,006 | 264 | 0.37 | 266,321 | 182 | 0.28 |
| Time deposits | 211,425 | 686 | 1.32 | 205,130 | 644 | 1.27 |
| Total interest-bearing deposits | 628,024 | 1,056 | 0.68 | 602,638 | 937 | 0.63 |
| Borrowed funds and subordinated debentures | 91,909 | 808 | 3.57 | 91,265 | 799 | 3.50 |
| Total interest-bearing liabilities | $ 719,933 | $ 1,864 | 1.05 % | $ 693,903 | $ 1,736 | 1.01 % |
| Noninterest-bearing liabilities: | ||||||
| Noninterest-bearing demand deposits | 161,729 | 132,167 | ||||
| Other liabilities | 4,307 | 3,169 | ||||
| Total noninterest-bearing liabilities | 166,036 | 135,336 | ||||
| Total shareholders' equity | 70,978 | 57,854 | ||||
| Total liabilities and shareholders' equity | $ 956,947 | $ 887,093 | ||||
| Net interest spread | $ 8,054 | 3.44 % | $ 7,337 | 3.38 % | ||
| Tax-equivalent basis adjustment | (34) | (50) | ||||
| Net interest income | $ 8,020 | $ 7,287 | ||||
| Net interest margin | 3.64 % | 3.57 % | ||||
| (A) Yields related to securities exempt from federal and state income taxes are stated on a fully tax-equivalent basis. They are reduced by the nondeductible portion of interest expense, assuming a federal tax rate of 34 percent and applicable state rates. | ||||||
| (B) The loan averages are stated net of unearned income, and the averages include loans on which the accrual of interest has been discontinued. | ||||||
| UNITY BANCORP, INC. | |||||
| QUARTERLY ALLOWANCE FOR LOAN LOSSES AND LOAN QUALITY SCHEDULES | |||||
| March 31, 2015 | |||||
| Amounts in thousands, except percentages | March 31, 2015 | December 31, 2014 | September 30, 2014 | June 30, 2014 | March 31, 2014 |
| ALLOWANCE FOR LOAN LOSSES: | |||||
| Balance, beginning of period | $ 12,551 | $ 12,918 | $ 12,858 | $ 12,807 | $ 13,141 |
| Provision for loan losses charged to expense | 200 | 850 | 550 | 550 | 600 |
| 12,751 | 13,768 | 13,408 | 13,357 | 13,741 | |
| Less: Chargeoffs | |||||
| SBA loans | 128 | 569 | 232 | 199 | 53 |
| SBA 504 loans | 589 | -- | -- | -- | 92 |
| Commercial loans | 100 | 377 | 72 | 134 | 454 |
| Residential mortgage loans | -- | 362 | 201 | 5 | 172 |
| Consumer loans | 30 | -- | 211 | 203 | 179 |
| Total chargeoffs | 847 | 1,308 | 716 | 541 | 950 |
| Add: Recoveries | |||||
| SBA loans | 37 | 12 | 111 | 10 | 7 |
| SBA 504 loans | -- | -- | -- | -- | -- |
| Commercial loans | 201 | 31 | 95 | 31 | 9 |
| Residential mortgage loans | 39 | 40 | 20 | -- | -- |
| Consumer loans | -- | 8 | -- | 1 | -- |
| Total recoveries | 277 | 91 | 226 | 42 | 16 |
| Net chargeoffs | 570 | 1,217 | 490 | 499 | 934 |
| Balance, end of period | $ 12,181 | $ 12,551 | $ 12,918 | $ 12,858 | $ 12,807 |
| LOAN QUALITY INFORMATION: | |||||
| Nonperforming loans (1) | $ 9,141 | $ 11,368 | $ 11,212 | $ 11,929 | $ 12,046 |
| Other real estate owned ("OREO") | 1,975 | 1,162 | 1,658 | 1,115 | 2,467 |
| Nonperforming assets | 11,116 | 12,530 | 12,870 | 13,044 | 14,513 |
| Less: Amount guaranteed by SBA | 270 | 1,569 | 200 | 2,305 | 1,320 |
| Net nonperforming assets | $ 10,846 | $ 10,961 | $ 12,670 | $ 10,739 | $ 13,193 |
| Loans 90 days past due & still accruing | $ 5 | $ 890 | $ -- | $ -- | $ 5 |
| Performing Troubled Debt Restructurings (TDRs) | $ 3,458 | $ 3,548 | $ 4,194 | $ 6,965 | $ 7,363 |
| (1) Nonperforming TDRs included in nonperforming loans | 2,911 | 2,960 | 3,473 | 741 | 448 |
| Total TDRs | $ 6,369 | $ 6,508 | $ 7,667 | $ 7,706 | $ 7,811 |
| Allowance for loan losses to: | |||||
| Total loans at quarter end | 1.55 % | 1.65 % | 1.74 % | 1.81 % | 1.87 % |
| Nonperforming loans (1) | 133.26 | 110.41 | 115.22 | 107.79 | 106.32 |
| Nonperforming assets | 109.58 | 100.17 | 100.37 | 98.57 | 88.25 |
| Net nonperforming assets | 112.31 | 114.51 | 101.96 | 119.73 | 97.07 |
| QTD net chargeoffs (annualized) to QTD average loans: | |||||
| SBA loans | 0.76 % | 4.35 % | 0.90 % | 1.40 % | 0.34 % |
| SBA 504 loans | 7.15 | -- | -- | -- | 1.18 |
| Commercial loans | (0.10) | 0.34 | (0.02) | 0.11 | 0.50 |
| Residential mortgage loans | (0.07) | 0.59 | 0.36 | 0.01 | 0.39 |
| Consumer loans | 0.20 | (0.05) | 1.58 | 1.70 | 1.58 |
| Total loans | 0.30 % | 0.63 % | 0.27 % | 0.29 % | 0.56 % |
| Nonperforming loans to total loans | 1.16 % | 1.49 % | 1.51 % | 1.68 % | 1.76 % |
| Nonperforming loans and TDRs to total loans | 1.61 | 1.96 | 2.07 | 2.67 | 2.84 |
| Nonperforming assets to total loans and OREO | 1.41 | 1.64 | 1.73 | 1.84 | 2.11 |
| Nonperforming assets to total assets | 1.07 | 1.24 | 1.33 | 1.40 | 1.51 |
| UNITY BANCORP, INC. | ||||||||||
| QUARTERLY FINANCIAL DATA | ||||||||||
| March 31, 2015 | ||||||||||
| (In thousands, except percentages and per share amounts) | March 31, 2015 | December 31, 2014 | September 30, 2014 | June 30, 2014 | March 31, 2014 | |||||
| SUMMARY OF INCOME: | ||||||||||
| Total interest income | $ 9,884 | $ 9,802 | $ 9,491 | $ 9,102 | $ 9,023 | |||||
| Total interest expense | 1,864 | 1,914 | 1,859 | 1,797 | 1,736 | |||||
| Net interest income | 8,020 | 7,888 | 7,632 | 7,305 | 7,287 | |||||
| Provision for loan losses | 200 | 850 | 550 | 550 | 600 | |||||
| Net interest income after provision for loan losses | 7,820 | 7,038 | 7,082 | 6,755 | 6,687 | |||||
| Total noninterest income | 1,641 | 1,660 | 1,853 | 1,640 | 1,526 | |||||
| Total noninterest expense | 6,502 | 6,045 | 6,241 | 6,144 | 6,258 | |||||
| Income before provision for income taxes | 2,959 | 2,653 | 2,694 | 2,251 | 1,955 | |||||
| Provision for income taxes | 1,020 | 952 | 808 | 723 | 662 | |||||
| Net income | $ 1,939 | $ 1,701 | $ 1,886 | $ 1,528 | $ 1,293 | |||||
| Net income per common share - Basic (1) | $ 0.23 | $ 0.21 | $ 0.24 | $ 0.20 | $ 0.17 | |||||
| Net income per common share - Diluted (1) | $ 0.23 | $ 0.20 | $ 0.24 | $ 0.20 | $ 0.17 | |||||
| COMMON SHARE DATA: | ||||||||||
| Market price per share | $ 9.08 | $ 9.43 | $ 9.63 | $ 9.28 | $ 7.95 | |||||
| Dividends paid | $ 0.03 | $ 0.03 | $ 0.03 | $ 0.02 | $ 0.02 | |||||
| Book value per common share | $ 8.55 | $ 8.36 | $ 8.17 | $ 7.95 | $ 7.74 | |||||
| Weighted average common shares outstanding - Basic | 8,417 | 8,378 | 7,847 | 7,605 | 7,586 | |||||
| Weighted average common shares outstanding - Diluted | 8,514 | 8,478 | 7,946 | 7,690 | 7,654 | |||||
| Issued and outstanding common shares | 8,423 | 8,388 | 8,370 | 7,607 | 7,602 | |||||
| OPERATING RATIOS (Annualized): | ||||||||||
| Return on average assets | 0.82 % | 0.70 % | 0.82 % | 0.68 % | 0.59 % | |||||
| Return on average equity (2) | 11.08 | 9.78 | 11.89 | 10.31 | 9.06 | |||||
| Efficiency ratio | 67.30 | 63.68 | 65.80 | 70.81 | 71.91 | |||||
| BALANCE SHEET DATA: | ||||||||||
| Total assets | $ 1,035,404 | $ 1,008,788 | $ 969,593 | $ 932,414 | $ 961,168 | |||||
| Total deposits | 789,441 | 794,341 | 781,920 | 728,083 | 767,624 | |||||
| Total loans | 784,642 | 761,825 | 744,366 | 708,889 | 683,951 | |||||
| Total securities | 77,308 | 80,082 | 86,879 | 90,470 | 109,459 | |||||
| Total shareholders' equity | 71,987 | 70,123 | 68,384 | 60,477 | 58,810 | |||||
| Allowance for loan losses | (12,181) | (12,551) | (12,918) | (12,858) | (12,807) | |||||
| TAX EQUIVALENT YIELDS AND RATES: | ||||||||||
| Interest-earning assets | 4.49 % | 4.35 % | 4.43 % | 4.34 % | 4.39 % | |||||
| Interest-bearing liabilities | 1.05 | 1.03 | 1.05 | 1.03 | 1.01 | |||||
| Net interest spread | 3.44 | 3.32 | 3.38 | 3.31 | 3.38 | |||||
| Net interest margin | 3.64 | 3.49 | 3.56 | 3.49 | 3.57 | |||||
| CREDIT QUALITY: | ||||||||||
| Nonperforming assets | 11,116 | 12,530 | 12,870 | 13,044 | 14,513 | |||||
| QTD net chargeoffs (annualized) to QTD average loans | 0.30 % | 0.63 % | 0.27 % | 0.29 % | 0.56 % | |||||
| Allowance for loan losses to total loans | 1.55 | 1.65 | 1.74 | 1.81 | 1.87 | |||||
| Nonperforming assets to total loans and OREO | 1.41 | 1.64 | 1.73 | 1.84 | 2.11 | |||||
| Nonperforming assets to total assets | 1.07 | 1.24 | 1.33 | 1.40 | 1.51 | |||||
| CAPITAL RATIOS AND OTHER: | ||||||||||
| Total equity to total assets | 6.95 % | 6.95 % | 7.05 % | 6.49 % | 6.12 % | |||||
| Leverage ratio | 8.93 | 8.71 | 8.96 | 8.24 | 8.19 | |||||
| Common equity tier 1 risk-based capital ratio | 9.25 | n/a | n/a | n/a | n/a | |||||
| Tier 1 risk-based capital ratio | 11.22 | 11.57 | 11.58 | 10.86 | 10.77 | |||||
| Total risk-based capital ratio | 12.48 | 12.83 | 12.84 | 12.12 | 12.03 | |||||
| Number of banking offices | 15 | 15 | 15 | 15 | 15 | |||||
| Number of ATMs | 16 | 16 | 16 | 16 | 16 | |||||
| Number of employees | 166 | 169 | 163 | 171 | 162 | |||||
| (1) Defined as net income adjusted for dividends accrued and accretion of discount on perpetual preferred stock divided by weighted average shares outstanding. | ||||||||||
| (2) Defined as net income adjusted for dividends accrued and accretion of discount on perpetual preferred stock divided by average shareholders' equity (excluding preferred stock). | ||||||||||