WHITE PLAINS, N.Y., Aug. 08, 2018 (GLOBE NEWSWIRE) -- NorthEast Community Bancorp, Inc. (OTC: 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 $3.38 million for the quarter ended June 30, 2018, an increase of 48.68%, compared to net income of $2.27 million for the quarter ended June 30, 2017.
Financial Condition and Operating Results for June 30, 2018 compared to June 30, 2017:
Net income before taxes for the three months ended June 30, 2018 was $4.41 million compared to $3.79 million for the three months ended June 30, 2017, an increase of 16.29%. The increase in net income before taxes was the result of our continuing focus on construction lending.
Net interest income for the three months ended June 30, 2018 increased by $1.81 million, or 23.94%, to $9.37 million from $7.56 million for the three months ended June 30, 2017. The increase in net interest income was the result of our continuing focus on construction lending.
Provision for loan losses decreased to $3.60 million for the three months ended June 30, 2018 from $3.73 million for the three months ended June 30, 2017. The decrease was due in part to an adjustment in our methodology for assessing the appropriateness of the allowance for loan losses from the prior year and reflects the increase in our construction loan portfolio, which currently represents 55% of our loan portfolio, and the lower loss factors on these loans due to their positive credit performance.
Total consolidated assets increased by $102.84 million, or 13.55%, to $861.84 million at June 30, 2018 from $759.00 million at June 30, 2017. Loans receivable (net) increased by $94.12 million, or 14.37%, to $748.90 million at June 30, 2018 from $654.78 million at June 30, 2017, while commitments, loans-in-process and standby letters of credit outstanding increased to $471.04 million at June 30, 2018 compared to $378.54 million at June 30, 2017. The increase in loans receivable was primarily due to growth in our construction loan portfolio.
Total liabilities at June 30, 2018 were $738.31 million compared to $646.18 million at June 30, 2017, an increase of $92.13 million, or 14.26%. The increase in total liabilities was primarily due to a $91.35 million increase in deposits from $574.00 million at June 30, 2017 to $665.35 million at June 30, 2018.
Federal Home Loan Bank advances remained the same at $62.87 million at June 30, 2018 and June 30, 2017.
Total stockholder’s equity increased by $10.71 million, or 9.49%, to $123.52 million at June 30, 2018 from $112.81 million at June 30, 2017. The increase was a result of net income of $11.16 million for the twelve month period ended June 30, 2018, partially offset by dividends declared and paid during the twelve month period.
Total stockholder equity for the six months from December 31, 2017 to June 30, 2018 increased by $6.60 million from $116.90 million on December 31, 2017 to $123.50 million on June 30, 2018, or 5.65%
Financial Condition at June 30, 2018 compared to December 31, 2017:
Total consolidated assets increased by $47.02 million, or 5.77%, to $861.84 million at June 30, 2018 from $814.82 million at December 31, 2017. Loans receivable (net) increased by $44.78 million or 6.36% to $748.90 million at June 30, 2018 from $704.12 million at December 31, 2017, while commitments, loans-in-process and standby letters of credit outstanding increased to $471.04 million as of June 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 June 30, 2018 were $738.31 million compared to $697.92 million at December 31, 2017, an increase of $40.39 million, or 5.79%. The increase in total liabilities was due to a $40.14 million increase in deposits from $625.21 million at December 31, 2017 to $665.35 million at June 30, 2018. Federal Home Loan Bank advances remained the same at $62.87 million at the end of the second quarter of 2018 and on December 31, 2017.
Non-performing loans totaled $4.90 million, or .56% of total assets at June 30, 2018 compared to $4.70 million or .58% of total assets at December 31, 2017. A commercial loan with an outstanding balance due of approximately $3.3 million and rated substandard is currently in litigation. During the second quarter of 2018, management made substantial progress toward a resolution involving this loan. In the event a settlement is not reached, it is likely that the borrower will seek bankruptcy protection. Management is currently assessing the value of the Bank’s collateral position and, following review of appraisals on the properties pledged as additional collateral for the loan and depending on the results of the settlement discussions and related matters, will determine if an allowance for loan losses is necessary and appropriate, and if so, the amount of such allowance. To the extent an allowance for loan losses is established for this commercial loan, our net income for the third quarter and the year will be adversely impacted.
NorthEast Community Bancorp, Inc.’s total stockholders’ equity at June 30, 2018 is a strong 14.33% 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. Martinek
Chief Executive Officer
(914) 684-2500