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Section 1: 8-K (BCB BANCORP, INC. FORM 8-K JULY 19, 2019)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): July 19, 2019

BCB BANCORP, INC.
(Exact Name of Registrant as Specified in its Charter)


New Jersey
 
0-50275
 
26-0065262
(State or Other Jurisdiction
of Incorporation)
 
(Commission File No.)
 
(I.R.S. Employer
Identification No.)

104-110 Avenue C, Bayonne, New Jersey
 
07002
(Address of Principal Executive Offices)
 
(Zip Code)

Registrant’s telephone number, including area code: (201) 823-0700

Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4c)

Title of each class
 
Trading
Symbol(s)
 
Name of each exchange on which registered
Common Stock, no par value per share
 
BCBP
 
The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company □

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. □

Item 2.02   Results of Operations and Financial Condition

On July 19, 2019, BCB Bancorp, Inc. (the “Company”) issued a press release reporting its financial results at and for the three and six months ended June 30, 2019.

A copy of the press release is attached as Exhibit 99.1 to this report and is being furnished to the Securities and Exchange Commission and shall not be deemed filed for any purpose.

Item 9.01   Financial Statements and Exhibits

(a)
 
Financial statements of businesses acquired.  None.
     
(b)
 
Pro forma financial information.  None.
     
(c)
 
Shell company transactions: None.
     
(d)
 
Exhibits.
   


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.


   
BCB BANCORP, INC.
 
 
DATE: July 19, 2019
By:  
 /s/ Thomas P. Keating
   
Thomas P. Keating
   
Senior Vice President and Chief Financial Officer

(Back To Top)

Section 2: EX-99.1 (PRESS RELEASE DATED JULY 19, 2019)



Contact:  Thomas Coughlin,
PRESIDENT & CEO
Thomas Keating, CFO
(201) 823-0700




BCB Bancorp, Inc. Earns $5.2 Million in 2Q19
Profits Grow 54% in First Six Months of the Year

BAYONNE, N.J., July 19, 2019 -- BCB Bancorp, Inc. (the “Company”), (NASDAQ: BCBP), the holding company for BCB Community Bank (the “Bank”), today reported that an increase in total interest income and decreases in the provision for loan losses and non-interest expenses, contributed to second quarter and year-to-date 2019 profits. Net income increased $2.9 million, or 126.0 percent, to $5.2 million for the second quarter of 2019, compared with $2.3 million for the second quarter of 2018. In the preceding quarter, the Company earned $5.5 million. There were no merger related costs associated with the IA Bancorp, Inc. (“IAB”) acquisition during the current quarter or the preceding quarter. This compares to acquisition costs of $2.0 million during the second quarter a year ago.
For the first six months of the year, net income increased $3.7 million, or 53.8 percent, to $10.7 million, compared with $7.0 million for the six months ended June 30, 2018.
“Our second quarter and year-to-date financial results reflect the success of our earnings-focused and conservative growth strategies, which are producing strong core earnings,” stated Thomas Coughlin, President and Chief Executive Officer. “This focus on pricing and profitable relationships resulted in higher net interest income. The on-going benefits of the IAB acquisition also contributed to profitability, as expenses were down through the continued capture of synergies from the transaction. We will continue to look for opportunities to build our relationships and grow our brand of banking throughout our surrounding markets.”
The IAB acquisition, which was completed during the second quarter of 2018, added approximately $221.4 million in assets, $178.4 million in deposits and $182.6 million in net loans.
Second Quarter 2019 Financial Highlights
Net income increased 126.0 percent to $5.2 million in the second quarter of 2019, compared to $2.3 million in the second quarter of 2018.
Earnings per diluted share increased to $0.30 in 2Q19 compared to $0.13 in 2Q18.
Net interest income, before the provision for loan losses, increased 4.4 percent to $20.9 million in the second quarter, compared to $20.0 million in the second quarter a year ago.
Net interest margin was 3.16 percent in the second quarter compared to 3.52 percent in the second quarter a year ago.
Total assets increased 8.8 percent to $2.738 billion at June 30, 2019, compared to $2.157 billion a year earlier.
Net loans receivable increased 8.5 percent to $2.300 billion at June 30, 2019, compared to $2.120 billion a year earlier.
Allowance for loan losses as a percentage of non-accrual loans was 433.4 percent at June 30, 2019, compared to 191.8 percent at June 30, 2018.
Tangible book value improved to $11.58 at June 30, 2019 from $10.69 a year ago.
Earlier this month, the Company’s Board of Directors declared a regular quarterly cash dividend of $0.14 per share. The dividend will be payable August 23, 2019, to common shareholders of record on August 9, 2019.
The Company issued $6.2 million of private placement common stock which closed in February 2019 and $5.3 million of preferred series G stock, which was issued in January 2019. The Company had also issued $33.5 million of subordinated debt in July 2018 which, for regulatory purposes, is treated as Tier 1 capital for the Bank and Tier 2 capital for the Company, when applicable.

Balance Sheet Review
Total assets increased by $221.6 million, or 8.8 percent, to $2.738 billion at June 30, 2019 from $2.517 billion at June 30, 2018 and increased by $19.7 million, or 0.7 percent, compared to March 31, 2019. The increase in total assets was primarily


BCBP Reports Second Quarter 2019 Earnings
July 19, 2019
Page 2

the result of an increase in total cash and cash equivalents as a result of new deposit relationships, organic loan growth, and the inclusion of operating and finance leases due to accounting standards changes.
Net loans receivable increased by $179.9 million, or 8.5 percent, to $2.300 billion at June 30, 2019 from $2.120 billion at June 30, 2018, and decreased slightly compared to $2.307 billion at March 31, 2019. The organic growth in loans over the first six months of 2019 represented increases of $27.2 million in construction loans, $4.3 million in commercial real estate and multi-family loans, and $603,000 in residential one-to-four family loans, partly offset by decreases of $9.0 million in home equity loans, $624,000 in commercial business loans, and $82,000 in consumer loans. The slight decrease in loans receivable for the current quarter reflects the Company’s growth and capital management strategies.
Total cash and cash equivalents increased by $47.2 million, or 26.2 percent, to $227.6 million at June 30, 2019 from $180.4 million a year ago, and increased by $34.1 million, or 17.6 percent compared to $193.5 million three months earlier. The Company’s level of cash and cash equivalents is a part of the Company’s strategy to maintain strong levels of liquidity. Total investment securities decreased by $13.3 million, or 9.8 percent, to $122.1 million at June 30, 2019 from $135.4 million at June 30, 2018, and decreased by $3.7 million, or 3.0 percent, compared to $125.9 million at March 31, 2019.
On January 1, 2019, the Company adopted Accounting Standards Update ("ASU") No. 2016-02 - Leases, requiring on-balance sheet reporting for all operating and financing leases, which resulted in the recording of $14.7 million in operating lease right-of-use assets and a corresponding $14.7 million in operating lease liabilities at June 30, 2019.
Total deposits increased by $223.3 million, or 11.3 percent, to $2.208 billion at June 30, 2019 from $1.985 billion at June 30, 2018, and increased by $19.6 million, or 0.9 percent, from $2.189 billion at March 31, 2019. Increases over the first six months of 2019 included $45.3 million in money market checking accounts, $14.0 million in non-interest bearing deposits, and $6.9 million in transaction accounts, partly offset by decreases of $36.0 million in certificates of deposit, and $2.7 million in savings and club accounts. The decrease in the Company’s certificates of deposit was related to reduced levels of listing service and brokered certificates of deposit, which saw decreases of $17.3 million and $132.0 million, respectively, during the first six months of 2019. These decreases were primarily related to the decrease in loan funding requirements and allowed the Company to reduce higher cost wholesale funding levels. The Company uses listing service and brokered certificates of deposit as additional sources of deposit liquidity, which totaled $19.6 million and $116.0 million, respectively, at June 30, 2019.
Debt obligations remained flat at $282.5 million at June 30, 2019 and March 31, 2019, and consisted of both Federal Home Loan Bank (“FHLB”) borrowings and subordinated debt balances. Debt obligations decreased when compared to $324.1 million at June 30, 2018. FHLB borrowings reflect the use of long-term advances to augment deposits as the Company’s funding source for originating loans and investing in investment securities. The weighted average interest rate of FHLB advances was 2.18 percent at June 30, 2019. The issuance of subordinated debt was to maintain adequate capital ratios for further growth. The fixed interest rate of subordinated debt balances was 5.625% at June 30, 2019.
Stockholders’ equity increased by $27.1 million, or 14.0 percent, to $221.2 million at June 30, 2019 from $194.1 million at June 30, 2018, and increased by $4.4 million, or 2.0 percent, compared to $216.7 million three months earlier. The year-over-year increase in stockholders’ equity was primarily attributable to the Company’s issuance of $6.2 million of common stock in a private placement which closed in February 2019 and the issuance of $5.3 million of preferred series G stock in a private placement, which was issued in January 2019. Retained earnings increased by $9.8 million to $43.3 million at June 30, 2019 from $33.6 million a year ago, due primarily to the increase in net income, net of dividends paid.
Second Quarter Income Statement Review
Net interest income increased by $875,000, or 4.4 percent, to $20.9 million for the second quarter of 2019 from $20.0 million for the second quarter of 2018. The increase in net interest income resulted primarily from an increase in the average balance of interest-earning assets of $361.0 million, or 15.9 percent, to $2.638 billion for the second quarter of 2019 from $2.277 billion for the second quarter a year ago. There was an increase in the average yield on interest-earning assets of 13 basis points to 4.66 percent for the second quarter of 2019, from 4.53 percent for the second quarter a year ago. There was also an increase in the average balance of interest-bearing liabilities of $304.6 million, or 16.1 percent, to $2.194 billion for


BCBP Reports Second Quarter 2019 Earnings
July 19, 2019
Page 3
the second quarter of 2019 from $1.890 billion for the second quarter a year ago, and an increase in the average rate on interest-bearing liabilities of 59 basis points to 1.80 percent for the second quarter of 2019 from 1.21 percent for the second quarter a year ago. Interest income on loans also included $518,000 of amortization of purchase credit adjustments related to the acquisition of IAB for the three months ended June 30, 2019, which added approximately eight basis points to the average yield on interest earning assets on an annualized basis. Interest expense, net, related to the issuance of subordinated debt in July 2018, totaled $529,000 for the three months ended June 30, 2019, which added approximately seven basis points to the average cost of funds on an annualized basis.
Net interest margin was 3.16 percent for the second quarter of 2019 and 3.52 percent for second quarter of 2018. “The decrease in the net interest margin was the result of the higher interest rate environment, with the increase in the cost of funds outpacing the return on interest earning assets for the short term,” said Coughlin.
Total non-interest income decreased by $235,000, or 15.0 percent, to $1.3 million for the second quarter of 2019 from $1.6 million for the second quarter of 2018. The decrease in total non-interest income was mainly related to lower income from fees and service charges as well as lower gains on sale of loans, partly offset by higher gain on sale of other real estate owned properties and gains on sale of investment securities. Fees and service charges decreased $169,000, or 17.4 percent to $802,000 for the second quarter of 2019 from $971,000 for the second quarter of 2018. The decrease in fees and service charges resulted primarily from lower loan-servicing fee income for the six months ended June 30, 2019 as compared to the same period in the prior year, which relates to less sales of loans in the current year period.
Second quarter 2019 total non-interest expense decreased by $2.1 million, or 13.1 percent, to $13.9 million from $16.0 million for the second quarter a year ago. There were no merger related expenses in the second quarter of 2019, compared to $2.0 million of merger-related expenses in the second quarter a year ago. Salaries and employee benefits expense decreased by $207,000 during the second quarter of 2019 compared to the second quarter a year ago. The decrease in salaries and employee benefits relates in part to a reduction in full-time equivalent employees, from 371 at June 30, 2018 to 366 at June 30, 2019, as part of management’s continued initiative to manage headcount throughout the organization.

The income tax provision increased by $1.1 million, or 93.1 percent, to $2.3 million for the second quarter of 2019 from $1.2 million for the second quarter of 2018, primarily due to the increase in income before taxes. The consolidated effective tax rate for the second quarter of 2019 was 30.7 percent compared to 34.2 percent for the second quarter of 2018. The lower effective tax rate in the current period primarily attributable to an adjustment for the second quarter of 2018, related to an increase in the New Jersey corporate business tax of 2.5 percent which was enacted July 1, 2018, and effective retroactively to January 1, 2018.

Year to Date Income Statement Review
Net interest income increased by $5.3 million, or 14.7 percent, to $41.8 million for the first six months of 2019 from $36.5 million for the first six months of 2018. Net interest margin was 3.17 percent for the first half of 2019 and 3.46 percent for the first half of 2018. The decrease in the net interest margin was the result of the higher interest rate environment within the period, with the increase in the cost of funds outpacing the return on interest earning assets for the short term. Interest income on loans also included $1.0 million of amortization of purchase credit adjustments related to the acquisition of IAB for the six months ended June 30, 2019, which added approximately eight basis points to the average yield on interest earning assets on an annualized basis. Interest expense, net, related to the issuance of subordinated debt in July 2018, totaled $1.0 million for the six months ended June 30, 2019, which added approximately seven basis points to the average cost of funds on an annualized basis.
Total non-interest income decreased by $2.0 million, or 39.6 percent, to $3.0 million for the first six months of 2019 from $5.0 million for the same period a year ago. The decrease in total non-interest income mainly related to a decrease in the amount of other non-interest income of $2.2 million, or 95.6 percent, to $102,000 for the first six months of 2019 from $2.3 million for the first six months of 2018. The decrease in other non-interest income was the result of $2.2 million in proceeds from a legal settlement recognized in the first quarter of 2018.

Total non-interest expense decreased by $320,000, or 1.1 percent, to $27.7 million for the first six months of 2019 from $28.0 million for the first six months of 2018. There were no merger-related expenses in the first six months of 2019,



BCBP Reports Second Quarter 2019 Earnings
July 19, 2019
Page 4

compared to $2.2 million in the first six months of 2018. Excluding merger-related expenses, total non-interest expense increased $1.9 million, or 7.2 percent, primarily related to normal inflationary increases and the inclusion of IAB expenses for the full six-month period ending June 30, 2019 as compared to the partial period of April 17 to June 30 in the prior year.
The income tax provision increased by $1.7 million, or 56.6 percent, to $4.8 million for the first six months of 2019 from $3.1 million for the six months of 2018, primarily related to the increase in income before taxes. The consolidated effective tax rate for the first half of 2019 was 30.8 percent compared to 30.5 percent for the first half of 2018.

Asset Quality
The provision for loan losses decreased by $1.3 million, to $755,000 for the second quarter of 2019 from $2.1 million for the second quarter of 2018.  Year-to-date, the provision for loan losses decreased by $1.8 million for the six months ended June 30, 2019, to $1.6 million from $3.4 million for the six months ended June 30, 2018. Non-accruing loans improved to $5.5 million, or 0.24 percent of gross loans at June 30, 2019, compared to $5.7 million, or 0.24 percent of gross loans at March 31, 2019, and $10.8 million, or 0.50 percent of gross loans, a year earlier. Non-accruing loans excluded $7.0 million of Purchased Credit-Impaired loans acquired through the merger with IAB.
Performing troubled debt restructured (“TDR”) loans that were not included in nonaccrual loans at June 30, 2019, were $21.8 million, compared to $23.1 million at March 31, 2019 and $20.7 million at June 30, 2018. Borrowers who are in financial difficulty and who have been granted concessions that may include interest rate reductions, term extensions, or payment alterations are categorized as TDR loans.
The allowance for loan losses was $23.8 million, or 433.5 percent of non-accruing loans and 1.02 percent of gross loans, at June 30, 2019 as compared to an allowance for loan losses of $23.0 million, or 405.7 percent of non-accruing loans and 0.99 percent of gross loans, at March 31, 2019 and an allowance for loan losses of $20.6 million or 191.8  percent of non-accruing loans and 0.96 percent of gross loans, a year ago.
The Company recognized net recoveries of $30,000 during the second quarter of 2019. This compares to net charge-offs of $244,000 in the first quarter of 2019 and net charge offs of $243,000 in the second quarter a year ago. Year-to-date, the Company recognized $214,000 in net charge-offs compared to $137,000 in net charge-offs in the first six months of 2018.
About BCB Bancorp, Inc.
Established in 2000 and headquartered in Bayonne, N.J., BCB Community Bank is the wholly-owned subsidiary of BCB Bancorp, Inc. (NASDAQ: BCBP). The Bank has 30 branch offices in Bayonne, Carteret, Colonia, Edison, Hoboken, Fairfield, Holmdel, Jersey City, Lodi, Lyndhurst, Maplewood, Monroe Township, Parsippany, Plainsboro, River Edge, Rutherford, South Orange, Union, and Woodbridge, New Jersey, three branches in Hicksville and Staten Island, New York. The Bank provides business and individuals a wide range of loans, deposit products, and retail and commercial banking services. For more information, please go to www.bcb.bank.
Forward-Looking Statements
This release, like many written and oral communications presented by BCB Bancorp, Inc., and our authorized officers, may contain certain forward-looking statements regarding our prospective performance and strategies within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for purposes of said safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies, and expectations of the Company, are generally identified by use of words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “project,” “seek,” “strive,” “try,” or future or conditional verbs such as “could,” “may,” “should,” “will,” “would,” or similar expressions. Our ability to predict results or the actual effects of our plans or strategies is inherently uncertain. Accordingly, actual results may differ materially from anticipated results.


BCBP Reports Second Quarter 2019 Earnings
July 19, 2019
Page 5

In addition to factors previously disclosed in the Company’s reports filed with the U.S. Securities and Exchange Commission (the "SEC") and those identified elsewhere in this document, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: difficulties and delays in integrating the Indus-American Bank business or fully realizing cost savings and other benefits of the Merger; business disruption following the Merger; changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates and capital markets; inflation; customer acceptance of BCB products and services; customer borrowing, repayment, investment and deposit practices; customer disintermediation; the introduction, withdrawal, success and timing of business initiatives; competitive conditions; the inability to realize cost savings or revenues or to implement integration plans and other consequences associated with mergers, acquisitions and divestitures; economic conditions; and the impact, extent and timing of technological changes, capital management activities, and actions of governmental agencies and legislative and regulatory actions and reforms.
Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results.

Explanation of Non-GAAP Financial Measures

Reported amounts are presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"). This press release also contains certain supplemental non-GAAP information that the Company’s management uses in its analysis of the Company’s financial results. The Company’s management believes that providing this information to analysts and investors allows them to better understand and evaluate the Company’s core financial results for the periods in question.
The Company provides measurements and ratios based on tangible stockholders' equity and efficiency ratios. These measures are utilized by regulators and market analysts to evaluate a company’s financial condition and, therefore, the Company’s management believes that such information is useful to investors.
For a reconciliation of GAAP to Non-GAAP financial measures included in this press release, see "Reconciliation of GAAP to Non-GAAP Financial Measures" below.


BCBP Reports Second Quarter 2019 Earnings
July 19, 2019
Page 6

 
Three Months Ended,
 
June 30, 2019
March 31, 2019
June 30, 2018
June 30, 2019 vs. March 31, 2019
June 30, 2019 vs. June 30, 2018
Interest and dividend income:
(Dollars in thousands)
   Loans, including fees
 $            28,634
 $                 28,233
 $             24,048
1.4%
19.1%
  Mortgage-backed securities
                    738
                         770
                     837
-4.2%
-11.8%
  Other investment securities
                    197
                         128
                     196
53.9%
0.5%
  FHLB stock and other interest earning assets
                 1,173
                      1,347
                     615
-12.9%
90.7%
      Total interest and dividend income
               30,742
                    30,478
                25,696
0.9%
19.6%
           
 Interest expense:
         
  Deposits:
         
     Demand
                 1,750
                      1,576
                     975
11.0%
79.5%
     Savings and club
                    110
                         113
                     105
-2.7%
4.8%
      Certificates of deposit
                 6,097
                      5,990
                  3,405
1.8%
79.1%
 
                 7,957
                      7,679
                  4,485
3.6%
77.4%
      Borrowings
                 1,920
                      1,897
                  1,221
1.2%
57.2%
       Total interest expense
                 9,877
                      9,576
                  5,706
3.1%
73.1%
           
Net interest income
               20,865
                    20,902
                19,990
-0.2%
4.4%
 Provision for loan losses
                    755
                         889
                  2,060
-15.1%
-63.3%
           
 Net interest income after provision for loan losses
               20,110
                    20,013
                17,930
0.5%
12.2%
           
 Non-interest income:
         
   Fees and service charges
                    802
                         883
                     971
-9.2%
-17.4%
   Gain on sales of loans
                    437
                         318
                     576
37.4%
-24.1%
   Gain on bulk sale of impaired loans held in portfolio
                       -
                         107
                        -
-100.0%
                           -
   Gain (loss) on sales of other real estate owned
                      45
                             8
                     (10)
462.5%
-550.0%
   Gain on sale of investment securities
                      21
                            -
                        -
                           -
                           -
   Unrealized (loss) gain on equity investments
                    (26)
                         291
                     (33)
-108.9%
-21.2%
   Other
                      49
                           53
                       59
-7.5%
-16.9%
       Total non-interest income
                 1,328
                      1,660
                  1,563
-20.0%
-15.0%
           
 Non-interest expense:
         
   Salaries and employee benefits
                 6,918
                      6,915
                  7,125
                           -
-2.9%
    Occupancy and equipment
                 2,649
                      2,630
                  2,476
0.7%
7.0%
   Data processing and service fees
                    731
                         721
                     828
1.4%
-11.7%
    Professional fees
                    473
                         533
                     533
-11.3%
-11.3%
   Director fees
                    316
                         318
                     201
-0.6%
57.2%
    Regulatory assessments
                    417
                         457
                     290
-8.8%
43.8%
   Advertising and promotional
                    123
                           73
                     100
68.5%
23.0%
    Other real estate owned, net
                    124
                          (16)
                     160
                           -
-22.5%
   Merger related costs
                       -
                            -
                  2,039
                           -
-100.0%
    Other
                 2,143
                      2,146
                  2,228
-0.1%
-3.8%
      Total non-interest expense
               13,894
                    13,777
                15,980
0.8%
-13.1%
           
Income before income tax provision
                 7,544
                      7,896
                  3,513
-4.5%
114.7%
 Income tax provision
                 2,317
                      2,445
                  1,200
-5.2%
93.1%
           
 Net Income
 $              5,227
 $                   5,451
 $               2,313
-4.1%
126.0%
Preferred stock dividends
                    342
                         317
                     262
7.9%
30.5%
 Net Income available to common stockholders
 $              4,885
 $                   5,134
 $               2,051
-4.9%
138.2%
           
 Net Income per common share-basic and diluted
         
   Basic
 $                0.30
 $                     0.32
 $                 0.13
-6.3%
130.8%
   Diluted
 $                0.30
 $                     0.32
 $                 0.13
-6.3%
130.8%
           
 Weighted average number of common shares outstanding
       
   Basic
               16,413
                    16,078
                15,610
2.1%
5.1%
   Diluted
               16,471
                    16,111
                15,748
2.2%
4.6%


BCBP Reports Second Quarter 2019 Earnings
July 19, 2019
Page 7

 
Six Months Ended,
 
June 30, 2019
June 30, 2018
June 30, 2019 vs. June 30, 2018
Interest and dividend income:
(Dollars in thousands)
   Loans, including fees
 $            56,867
 $                 43,569
30.5%
  Mortgage-backed securities
                 1,508
                      1,536
-1.8%
  Other investment securities
                    325
                         300
8.3%
  FHLB stock and other interest earning assets
                 2,520
                      1,233
104.4%
      Total interest and dividend income
               61,220
                    46,638
31.3%
       
 Interest expense:
     
  Deposits:
     
      Demand
                 3,326
                      1,772
87.7%
     Savings and club
                    223
                         202
10.4%
      Certificates of deposit
               12,087
                      6,135
97.0%
 
               15,636
                      8,109
92.8%
      Borrowings
                 3,817
                      2,099
81.8%
       Total interest expense
               19,453
                    10,208
90.6%
       
Net interest income
               41,767
                    36,430
14.7%
 Provision for loan losses
                 1,644
                      3,402
-51.7%
       
 Net interest income after provision for loan losses
               40,123
                    33,028
21.5%
       
 Non-interest income:
     
   Fees and service charges
                 1,685
                      1,681
0.2%
   Gain on sales of loans
                    755
                      1,159
-34.9%
   Gain (loss) on bulk sale of impaired loans held in portfolio
                    107
                          (24)
                       -
   Gain (loss) on sales of other real estate owned
                      53
                          (10)
                       -
   Gain on sale of investment securities
                      21
                            -
                       -
   Unrealized gain (loss) on equity investments
                    265
                        (160)
                       -
   Other
                    102
                      2,303
-95.6%
       Total non-interest income
                 2,988
                      4,949
-39.6%
       
 Non-interest expense:
     
   Salaries and employee benefits
               13,833
                    13,392
3.3%
    Occupancy and equipment
                 5,279
                      4,538
16.3%
   Data processing and service fees
                 1,452
                      1,557
-6.7%
    Professional fees
                 1,006
                      1,038
-3.1%
   Director fees
                    634
                         402
57.7%
    Regulatory assessments
                    874
                         529
65.2%
   Advertising and promotional
                    196
                         185
5.9%
    Other real estate owned, net
                    108
                         191
-43.5%
   Merger related costs
                       -
                      2,184
-100.0%
    Other
                 4,289
                      3,975
7.9%
      Total non-interest expense
               27,671
                    27,991
-1.1%
       
Income before income tax provision
               15,440
                      9,986
54.6%
 Income tax provision
                 4,762
                      3,041
56.6%
       
 Net Income
 $            10,678
 $                   6,945
53.8%
Preferred stock dividends
                    659
                         428
54.0%
 Net Income available to common stockholders
 $            10,019
 $                   6,517
53.7%
       
 Net Income per common share-basic and diluted
     
   Basic
 $                0.62
 $                     0.43
44.2%
   Diluted
 $                0.62
 $                     0.42
47.6%
       
 Weighted average number of common shares outstanding
   
   Basic
               16,245
                    15,329
6.0%
   Diluted
               16,290
                    15,465
5.3%

BCBP Reports Second Quarter 2019 Earnings
July 19, 2019
Page 8
 
 
June 30, 2019
March 31, 2019
June 30, 2018
June 30, 2019 vs. March 31, 2019
June 30, 2019 vs. June 30, 2018
 ASSETS
(Dollars in thousands)
 Cash and amounts due from depository institutions
 $            20,660
 $                18,610
 $          23,125
11.0%
-10.7%
Interest-earning deposits
             206,982
                 174,938
           157,320
18.3%
31.6%
    Total cash and cash equivalents
             227,642
                 193,548
           180,445
17.6%
26.2%
           
 Interest-earning time deposits
                    735
                        735
                  980
                           -
-25.0%
Debt securities available for sale
             116,258
                 117,942
           127,291
-1.4%
-8.7%
 Equity investments
                 5,901
                     7,963
               8,134
-25.9%
-27.5%
Loans held for sale
                       -
                     1,347
               1,405
-100.0%
-100.0%
 Loans receivable, net of allowance for loan losses
         
   of $23,789, $23,004, and $20,640, respectively
          2,299,765
              2,307,140
        2,119,829
-0.3%
8.5%
 Federal Home Loan Bank of New York stock, at cost
               13,821
                   13,405
             16,744
3.1%
-17.5%
Premises and equipment, net
               19,482
                   19,684
             21,055
-1.0%
-7.5%
 Operating lease right-of-use asset
               14,650
                   16,019
                     -
-8.5%
                           -
Accrued interest receivable
                 9,315
                     9,750
               7,563
-4.5%
23.2%
 Other real estate owned
                 1,235
                     1,746
               1,178
-29.3%
4.8%
Deferred income taxes
               12,962
                   13,302
             11,451
-2.6%
13.2%
 Goodwill and other intangibles
                 5,587
                     5,584
               5,691
0.1%
-1.8%
 Other assets
               10,777
                   10,235
             14,798
5.3%
-27.2%
     Total Assets
 $       2,738,130
 $           2,718,400
 $     2,516,564
0.7%
8.8%
           
LIABILITIES AND STOCKHOLDERS' EQUITY
         
           
LIABILITIES
         
 Non-interest bearing deposits
 $          278,602
 $              273,370
 $        229,292
1.9%
21.5%
Interest bearing deposits
          1,929,620
              1,915,263
        1,755,584
0.7%
9.9%
   Total deposits
          2,208,222
              2,188,633
        1,984,876
0.9%
11.3%
FHLB advances
             245,800
                 245,800
           320,005
                           -
-23.2%
 Subordinated debentures
               36,693
                   36,635
               4,124
0.2%
789.7%
 Operating lease liability
               14,724
                   16,059
                     -
-8.3%
-
 Other liabilities
               11,538
                   14,555
             13,483
-20.7%
-14.4%
     Total Liabilities
          2,516,977
              2,501,682
        2,322,488
0.6%
8.4%
           
STOCKHOLDERS' EQUITY
         
Preferred stock: $0.01 par value, 10,000,000 shares authorized
                       -
                           -
                     -
-
-
 Additional paid-in capital preferred stock
               25,016
                   25,016
             19,706
                           -
26.9%
Common stock: no par value, 20,000,000 shares authorized
                       -
                           -
                     -
-
-
 Additional paid-in capital common stock
             176,767
                 176,379
           175,716
0.2%
0.6%
Retained earnings
               43,347
                   40,750
             33,570
6.4%
29.1%
 Accumulated other comprehensive (loss)
               (1,929)
                   (3,379)
              (5,800)
-42.9%
-66.7%
Treasury stock, at cost
             (22,048)
                 (22,048)
            (29,116)
                           -
-24.3%
     Total Stockholders' Equity
             221,153
                 216,718
           194,076
2.0%
14.0%
           
      Total Liabilities and Stockholders' Equity
 $       2,738,130
 $           2,718,400
 $     2,516,564
0.7%
8.8%
           
Outstanding common shares
               16,461
                   16,398
             15,783
   


BCBP Reports Second Quarter 2019 Earnings
July 19, 2019
Page 9
 
   
Three Months Ended June 30,
   
2019
   
2018
   
Average Balance
   
Interest Earned/Paid
 
Average Yield/Rate (3)
   
Average Balance
   
Interest Earned/Paid
 
Average Yield/Rate (3)
   
(Dollars in thousands)
Interest-earning assets:
                             
Loans Receivable
$
 2,329,209 
 
$
 28,634 
 
4.92%
 
$
 2,033,372 
 
$
 24,048 
 
4.74%
Investment Securities
 
 124,520 
   
 935 
 
3.00%
   
 146,760 
   
 1,033 
 
2.82%
Interest-earning deposits
 
 184,266 
   
 1,173 
 
2.55%
   
 96,853 
   
 615 
 
2.55%
   Total Interest-earning assets
 
 2,637,995 
   
 30,742 
 
4.66%
   
 2,276,985 
   
 25,696 
 
4.53%
Non-interest-earning assets
 
 78,478 
             
 46,060 
         
   Total assets
$
 2,716,473 
           
$
 2,323,045 
         
Interest-bearing liabilities:
                             
Interest-bearing demand accounts
$
 341,418 
 
$
 648 
 
0.76%
 
$
 333,641 
 
$
 473 
 
0.57%
Money market accounts
 
 253,633 
   
 1,102 
 
1.74%
   
 186,650 
   
 502 
 
1.07%
Savings accounts
 
 259,398 
   
 110 
 
0.17%
   
 264,764 
   
 105 
 
0.16%
Certificates of Deposit
 
 1,056,375 
   
 6,097 
 
2.31%
   
 876,266 
   
 3,405 
 
1.56%
   Total interest-bearing deposits
 
 1,910,824 
   
 7,957 
 
1.67%
   
 1,661,321 
   
 4,485 
 
1.08%
Borrowed funds
 
 283,424 
   
 1,920 
 
2.71%
   
 228,353 
   
 1,221 
 
2.15%
   Total interest-bearing liabilities
 
 2,194,248 
   
 9,877 
 
1.80%
   
 1,889,674 
   
 5,706 
 
1.21%
Non-interest-bearing liabilities
 
 304,680 
             
 244,544 
         
   Total liabilities
 
 2,498,928 
             
 2,134,218 
         
Stockholders' equity
 
 217,545 
             
 188,827 
         
   Total liabilities and stockholders' equity
$
 2,716,473 
           
$
 2,323,045 
         
Net interest income
     
$
 20,865 
           
$
 19,990 
   
Net interest rate spread(1)
           
2.86%
             
3.32%
Net interest margin(2)
           
3.16%
             
3.52%
                               
                               

(1)
Net interest rate spread represents the difference between the average yield on average interest-earning assets and the average cost of average interest-bearing liabilities.
(2)
Net interest margin represents net interest income divided by average total interest-earning assets.
(3)
Annualized.




BCBP Reports Second Quarter 2019 Earnings
July 19, 2019
Page 10

   
Six Months Ended June 30,
   
2019
   
2018
   
Average Balance
   
Interest Earned/Paid
 
Average Yield/Rate (3)
   
Average Balance
   
Interest Earned/Paid
 
Average Yield/Rate (3)
   
(Dollars in thousands)
Interest-earning assets:
                             
Loans Receivable
$
 2,322,674 
 
$
 56,867 
 
4.90%
 
$
 1,876,349 
 
$
 43,569 
 
4.68%
Investment Securities
 
 125,139 
   
 1,833 
 
2.93%
   
 138,133 
   
 1,836 
 
2.68%
Interest-earning deposits
 
 185,368 
   
 2,520 
 
2.72%
   
 109,937 
   
 1,233 
 
2.26%
   Total Interest-earning assets
 
 2,633,181 
   
 61,220 
 
4.65%
   
 2,124,419 
   
 46,638 
 
4.43%
Non-interest-earning assets
 
 70,550 
             
 44,647 
         
   Total assets
$
 2,703,731 
           
$
 2,169,066 
         
Interest-bearing liabilities:
                             
Interest-bearing demand accounts
$
 341,538 
 
$
 1,252 
 
0.73%
 
$
 323,843 
 
$
 903 
 
0.56%
Money market accounts
 
 245,368 
   
 2,074 
 
1.69%
   
 172,074 
   
 869 
 
1.02%
Savings accounts
 
 259,958 
   
 223 
 
0.17%
   
 261,792 
   
 202 
 
0.16%
Certificates of Deposit
 
 1,070,757 
   
 12,087 
 
2.26%
   
 798,672 
   
 6,135 
 
1.55%
   Total interest-bearing deposits
 
 1,917,621 
   
 15,636 
 
1.63%
   
 1,556,381 
   
 8,109 
 
1.05%
Borrowed funds
 
 283,442 
   
 3,817 
 
2.69%
   
 205,311 
   
 2,099 
 
2.06%
   Total interest-bearing liabilities
 
 2,201,063 
   
 19,453 
 
1.77%
   
 1,761,692 
   
 10,208 
 
1.17%
Non-interest-bearing liabilities
 
 290,511 
             
 224,561 
         
   Total liabilities
 
 2,491,574 
             
 1,986,253 
         
Stockholders' equity
 
 212,157 
             
 182,813 
         
   Total liabilities and stockholders' equity
$
 2,703,731 
           
$
 2,169,066 
         
Net interest income
     
$
 41,767 
           
$
 36,430 
   
Net interest rate spread(1)
           
2.88%
             
3.26%
Net interest margin(2)
           
3.17%
             
3.46%
                               
                               


(1)
Net interest rate spread represents the difference between the average yield on average interest-earning assets and the average cost of average interest-bearing liabilities.
(2)
Net interest margin represents net interest income divided by average total interest-earning assets.
(3)
Annualized.



BCBP Reports Second Quarter 2019 Earnings
July 19, 2019
Page 11


 
Financial condition data by quarter
 
Q2 2019
Q1 2019
Q4 2018
Q3 2018
Q2 2018
Q1 2018
             
 
(In thousands, except tangible book value)
Total assets
 $     2,738,130
 $     2,718,400
 $     2,674,731
 $     2,637,868
 $         2,516,564
 $         2,082,313
Cash and cash equivalents
227,642
193,548
195,264
206,710
180,445
137,334
Securities
122,159
125,905
127,007
127,863
135,425
127,324
Loans receivable, net
2,299,765
2,307,140
2,278,492
2,225,001
2,119,829
1,764,597
Deposits
2,208,222
2,188,633
2,180,724
2,116,624
1,984,876
1,691,353
Borrowings
282,493
282,435
282,377
312,319
324,124
204,124
Stockholders’ equity
221,153
216,718
200,215
195,763
194,076
177,386
Tangible Book Value
11.58
11.35
11.00
10.78
10.69
10.90
             
 
Operating data by quarter
 
Q2 2019
Q1 2019
Q4 2018
Q3 2018
Q2 2018
Q1 2018
             
 
(In thousands, except for per share amounts)
Net interest income
 $             20,865
 $             20,902
 $             21,171
 $             20,080
 $                19,990
 $                16,440
Provision for loan losses
                        755
                        889
                        821
                        907
                       2,060
                       1,342
Non-interest income
1,328
1,660
1,159
1,852
1,563
3,386
Non-interest expense
13,894
13,777
13,884
14,391
15,980
12,011
Income tax expense
2,317
2,445
2,401
2,040
1,200
1,841
Net income
 $                5,227
 $                5,451
 $                5,224
 $                4,594
 $                   2,313
 $                   4,632
Net income per diluted share
 $                   0.30
 $                   0.32
 $                   0.31
 $                   0.27
 $                      0.13
 $                      0.29
Common Dividends declared per share
 $                   0.14
 $                   0.14
 $                   0.14
 $                   0.14
 $                      0.14
 $                      0.14
             
 
Financial Ratios
 
Q2 2019
Q1 2019
Q4 2018
Q3 2018
Q2 2018
Q1 2018
Return on average assets
0.77%
0.81%
0.78%
0.72%
0.40%
0.92%
Return on average stockholder’s equity
9.61%
10.55%
10.66%
9.44%
4.90%
10.48%
Net interest margin
3.16%
3.18%
3.24%
3.22%
3.52%
3.34%
Stockholder’s equity to total assets
8.08%
7.97%
7.49%
7.42%
7.71%
8.52%
Efficiency Ratio
62.61%
61.06%
62.18%
65.62%
74.14%
60.58%
             
 
Asset Quality Ratios
 
(In thousands, except for ratio %)
 
Q2 2019
Q1 2019
Q4 2018
Q3 2018
Q2 2018
Q1 2018
Non-Accrual Loans
 $                5,488
 $                5,670
 $                7,221
 $             11,093
 $                10,763
 $                10,619
Non-Accrual Loans as a % of Total Loans
0.24%
0.24%
0.31%
0.49%
0.50%
0.60%
ALLL as % of Non-Accrual Loans
433.47%
405.71%
309.64%
193.85%
191.79%
172.68%
Impaired Loans
                 37,275
                 40,533
                 42,408
                 47,251
                    50,899
                    36,199
Classified Loans
                 22,679
                 23,977
                 26,161
                 30,179
                    33,605
                    20,299


BCBP Reports Second Quarter 2019 Earnings
July 19, 2019
Page 12


 
Recorded Investment in Loans Receivable by quarter
 
Q2 2019
Q1 2019
Q4 2018
Q3 2018
Q2 2018
Q1 2018
 
(In Thousands)
Residential one-to-four family
 $              258,688
 $              258,184
 $              258,085
 $              254,149
 $     249,996
 $     238,275
Commercial and multi-family
1,702,132
1,724,326
1,697,837
1,701,105
1,622,881
1,362,684
Construction
134,963
114,462
107,783
75,601
56,067
48,433
Commercial business
164,569
167,067
165,193
142,312
137,767
81,054
Home equity
63,927
66,946
72,895
73,714
74,507
53,053
Consumer
727
731
809
1,368
898
1,127
 
 $          2,325,006
 $          2,331,716
 $          2,302,602
 $          2,248,249
 $ 2,142,116
 $ 1,784,626
Less:
           
   Deferred loan fees, net
                      (1,452)
                      (1,572)
                      (1,751)
                      (1,744)
             (1,647)
             (1,692)
   Allowance for loan loss
                   (23,789)
                   (23,004)
                   (22,359)
                   (21,504)
          (20,640)
          (18,337)
             
Total loans, net
 $          2,299,765
 $          2,307,140
 $          2,278,492
 $          2,225,001
 $ 2,119,829
 $ 1,764,597
             
 
Non-Accruing Loans in Portfolio by quarter
 
Q2 2019
Q1 2019
Q4 2018
Q3 2018
Q2 2018
Q1 2018
 
(In Thousands)
Originated loans:
           
   Residential one-to-four family
 $                    1,022
 $                    1,415
 $                    1,160
 $                    1,457
 $           1,480
 $           1,432
   Commercial and multi-family
1,881
1,364
2,568
5,572
5,578
5,652
Commercial business
                             745
                             256
                             356
                             251
                    163
                    176
Home equity
                             129
                             272
                             277
                             338
                    397
                    356
Consumer
                                  -
                                  -
                                  -
                                  -
                       42
                         -
Sub-total:
 $                    3,777
 $                    3,307
 $                    4,361
 $                    7,618
 $           7,660
 $           7,616
             
Acquired loans initially recorded at fair value:
           
   Residential one-to-four family
 $                    1,116
 $                    1,704
 $                    2,165
 $                    2,590
 $           2,474
 $           2,374
   Commercial and multi-family
                                  -
                             597
                             605
                             590
                    590
                    590
Commercial business
                             378
                                  -
                                48
                             295
                         -
                         -
Home equity
                             217
                                62
                                42
                                  -
                       39
                       39
Sub-total:
 $                    1,711
 $                    2,363
 $                    2,860
 $                    3,475
 $           3,103
 $           3,003
             
Total:
 $                    5,488
 $                    5,670
 $                    7,221
 $                 11,093
 $        10,763
 $        10,619

BCBP Reports Second Quarter 2019 Earnings
July 19, 2019
Page 13

 
Reconciliation of GAAP to Non-GAAP Financial Measures by quarter
             
 
Tangible Book Value per Share
 
Q2 2019
Q1 2019
Q4 2018
Q3 2018
Q2 2018
Q1 2018
 
(Dollars in thousnds, except per share amounts)
Total Stockholders' Equity
 $              221,153
 $              216,718
 $              200,215
 $              195,763
 $              194,076
 $              177,386
Less: goodwill
5,587
5,584
5,699
5,714
5,691
                                  -
Less: preferred stock
25,016
25,016
19,706
19,706
19,706
13,241
Total tangible stockholders' equity
190,550
186,118
174,810
170,343
168,679
164,145
Shares outstanding
                     16,461
                     16,398
                     15,889
                     15,799
                     15,783
                     15,055
Book value per share
 $                    13.43
 $                    13.22
 $                    12.60
 $                    12.39
 $                    12.30
 $                    11.78
Tangible book value per share
 $                    11.58
 $                    11.35
 $                    11.00
 $                    10.78
 $                    10.69
 $                    10.90
             
 
Efficiency Ratio
 
Q2 2019
Q1 2019
Q4 2018
Q3 2018
Q2 2018
Q1 2018
 
(Dollars in thousands)
Net interest income
 $                 20,865
 $                 20,902
 $                 21,171
 $                 20,080
 $                 19,990
 $                 16,440
Non-interest income
1,328
1,660
1,159
1,852
1,563
3,386
Total income
                     22,193
                     22,562
                     22,330
                     21,932
                     21,553
                     19,826
Non-interest expense
                     13,894
                     13,777
                     13,884
                     14,391
                     15,980
                     12,011
Efficiency Ratio
62.61%
61.06%
62.18%
65.62%
74.14%
60.58%


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