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

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): October 18, 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))

Title of each class
 
Trading
Symbol(s)
 
Name of each exchange on which registered
Common Stock, no par value
 
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 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
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 October 18, 2019, BCB Bancorp, Inc. (the “Company”) issued a press release reporting its financial results at and for the three and nine months ended September 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.

   

 
         


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: October 18, 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)


 Contact:



Thomas Keating, CFO
Pamela Sclafane, VP Marketing
(201) 823-0700




BCB Bancorp, Inc. Earnings Increase 14% to $5.2 Million in 3Q19, from 3Q18
Profits Grow 38% in First Nine Months of 2019

BAYONNE, N.J., October 18, 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 third quarter and year-to-date 2019 profits. Net income increased $638,000, or 13.9 percent, to $5.2 million for the third quarter of 2019, compared with $4.6 million for the third quarter of 2018. In the preceding quarter, the Company earned $5.2 million.
For the first nine months of the year, net income increased $4.4 million, or 37.9 percent, to $15.9 million, compared with $11.5 million for the first nine months of 2018.
“Our third quarter 2019 financial performance demonstrates that the execution of our strategic plan is effective and continues to build shareholder value,” stated Thomas Coughlin, President and Chief Executive Officer.  “Our focus on producing strong core earnings, fostering new client relationships to fund our growth and strengthening our capital position, are all showing results.  Additionally, we are taking steps to strengthen our balance sheet and position ourselves for future growth and higher performance.  We remain focused on competing for business in our local markets and looking for additional growth opportunities.”
Executive Summary
Net income increased 13.9 percent to $5.2 million in the third quarter of 2019, compared to $4.6 million in the third quarter of 2018.
Earnings per diluted share increased to $0.30 in 3Q19, compared to $0.27 in 3Q18.
Net interest margin was 3.06 percent in the third quarter 2019, compared to 3.22 percent in the third quarter a year ago. This decrease was the result of our focus on increasing our cash position to allow for paydowns of borrowings and higher cost CDs.
Total assets increased 7.1 percent to $2.825 billion at September 30, 2019, compared to $2.638 billion a year earlier.
As a result of management’s focus on repositioning the balance sheet, net loans receivable increased 1.3 percent to $2.254 billion at September 30, 2019, compared to $2.225 billion a year earlier.
Allowance for loan losses as a percentage of non-accrual loans was 486.6 percent at September 30, 2019, compared to 193.9 percent at September 30, 2018.
Tangible book value improved to $11.72 at September 30, 2019 from $10.78 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 November 22, 2019, to common shareholders of record on November 8, 2019.
The Company issued $6.3 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 $187.6 million, or 7.1 percent, to $2.825 billion at September 30, 2019 from $2.638 billion at September 30, 2018 and increased by $87.4 million, or 3.2 percent, compared to June 30, 2019. The increase in total assets was primarily the result of an increase in total cash and cash equivalents as a result of new deposit relationships, proceeds from FHLB borrowings, and the inclusion of operating and finance leases due to accounting standards changes.
Net loans receivable increased by $28.7 million, or 1.3 percent, to $2.254 billion at September 30, 2019 from $2.225 billion at September 30, 2018, and decreased slightly compared to $2.300 billion at June 30, 2019. After significant loan growth in 2018, management focused on repositioning the balance sheet, which included curtailing loan growth and strengthening our capital position. The change in loans over the first nine months of 2019 represented decreases of $28.9 million in commercial real estate and multi-family loans, $9.2 million in home equity loans, $5.1 million in residential one-to-four family loans, $3.5 million in commercial business loans, and $81,000 in consumer loans,  partly offset by an increase of  $23.9 million in construction loans.

BCBP Reports Third Quarter 2019 Earnings
October 18, 2019
Page 2

Total cash and cash equivalents increased by $169.9 million, or 82.2 percent, to $376.6 million at September 30, 2019 from $206.7 million a year ago, and increased by $149.0 million, or 65.4 percent compared to $227.6 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 $23.8 million, or 18.6 percent, to $104.1 million at September 30, 2019 from $127.9 million at September 30, 2018, and decreased by $18.1 million, or 14.8 percent, compared to $122.2 million at June 30, 2019, representing normal repayments, calls, and maturities.
On January 1, 2019, the Company adopted Accounting Standards Update ("ASU") No. 2016-02 - Leases, requiring on-balance sheet reporting for all operating leases, which resulted in the recording of $14.0 million in operating lease right-of-use assets and a corresponding $14.1 million in operating lease liabilities at September 30, 2019.
Total deposits increased by $146.8 million, or 6.9 percent, to $2.263 billion at September 30, 2019 from $2.117 billion at September 30, 2018, and increased by $55.2 million, or 2.5 percent, from $2.208 billion at June 30, 2019.  Increases over the first nine months of 2019 included $50.2 million in money market checking accounts, $12.2 million in non-interest bearing deposits, $13.9 million in transaction accounts, and $10.4 million in certificates of deposit, partly offset by decreases of $4.0 million in savings and club accounts. The Company uses listing service and brokered certificates of deposit as additional sources of deposit liquidity, which totaled $10.9 million and $0, respectively, at September 30, 2019.
Debt obligations remained flat at $312.6 million at September 30, 2019 compared to a year ago and increased $30.1 million compared to $282.5 million at June 30, 2019.  Debt obligations consisted of both Federal Home Loan Bank (“FHLB”) borrowings and subordinated debt balances. 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 increase in FHLB borrowings in the current quarter related to replacing $40 million in advance of the borrowing maturity dates in the next quarter that were secured at favorable interest rates. The weighted average interest rate of FHLB advances was 2.15 percent at September 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 September 30, 2019.
Stockholders’ equity increased by $28.0 million, or 14.3 percent, to $223.7 million at September 30, 2019 from $195.8 million at September 30, 2018, and increased by $2.6 million, or 1.2 percent, compared to $221.2 million three months earlier. The year-over-year increase in stockholders’ equity was primarily attributable to the Company’s issuance of $6.3 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 $10.2 million to $45.9 million at September 30, 2019 from $35.7 million a year ago, due primarily to the increase in net income, net of dividends paid, and the decrease in the accumulated other comprehensive loss of $4.0 million.
Third Quarter Income Statement Review
Net interest income increased by $680,000, or 3.4 percent, to $20.8 million for the third quarter of 2019 from $20.1 million for the third quarter of 2018.  The increase in net interest income resulted primarily from an increase in the average balance of interest-earning assets of $213.0 million, or 8.5 percent, to $2.710 billion for the third quarter of 2019 from $2.497 billion for the third quarter a year ago. There was also an increase in the average yield on interest-earning assets of 15 basis points to 4.63 percent for the third quarter of 2019 from 4.48 percent for the third quarter of 2018. The average balance of interest-bearing liabilities increased $173.6 million, or 8.3 percent, to $2.265 billion for the third quarter of 2019 from $2.092 billion for the third quarter of 2018, and there was an increase in the average rate on interest-bearing liabilities of 36 basis points to 1.87 percent for the third quarter of 2019 from 1.51 percent for the third quarter a year ago. Interest income on loans also included $505,000 of amortization of purchase credit adjustments related to the acquisition of IAB for the three months ended September 30, 2019, which added approximately seven basis points to the average yield on interest earning assets on an annualized basis.

BCBP Reports Third Quarter 2019 Earnings
October 18, 2019
Page 3

Net interest margin was 3.06 percent for the third quarter of 2019 and 3.22 percent for the third quarter of 2018.  “The decrease in our net interest margin for the current quarter was the result of a competitively higher interest rate environment, with the increase in the cost of funds outpacing the return on interest earning assets,” Coughlin said. “We expect with the two recent Federal Reserve rate cuts for our net interest margin to continue to remain under pressure in the short term.”
Total non-interest income decreased by $469,000, or 25.3 percent, to $1.4 million for the third quarter of 2019 from $1.9 million for the third 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 gains on sale of other real estate owned properties and gains on sale of investment securities. Fees and service charges decreased $237,000, or 21.7 percent to $855,000 for the third quarter of 2019 from $1.1 million for the third quarter of 2018, mainly related to less mortgage servicing fee income with less sales of loans. Gain on sales of loans decreased by $649,000, or 87.9 percent, to $89,000 for the third quarter of 2019 from $738,000 for the third quarter of 2018. Factors considered when deciding to sell loans include market conditions, demand, and the loan portfolio. Gains on sale of other real estate owned properties increased by $110,000, to $124,000 for the third quarter of 2019 from a gain of $14,000 for the third quarter of 2018. Gain on sale of investment securities was $283,000 for the third quarter of 2019, with no comparable sales for the third quarter a year ago.
Third quarter total non-interest expense decreased by $739,000, or 5.1 percent, to $13.7 million from $14.4 million for the third quarter a year ago. Regulatory fees associated with FDIC assessments decreased by $510,000 for the third quarter of 2019 from $419,000 for the third quarter of 2018. The decrease was primarily due to a decrease in the assessment rate, a credit that related to the receipt of an FDIC Small Bank Assessment Credit, which came as a result of the FDIC exceeding its stated Deposit Fund Reserve Ratio, partly offset by an increase in the assessment base.  Data processing expense decreased by $166,000, or 17.6 percent, to $776,000 for the third quarter of 2019 from $942,000 for the third quarter a year ago primarily attributable to non-recurring charges in the third quarter of 2018 related to the merger with IAB.  There were no merger-related expenses during the third quarter of 2019, compared to $119,000 in merger-related costs in the third quarter a year ago. Salaries and employee benefits expense increased by a modest 1.9 percent, or $138,000. The increase in salaries and employee benefits related in part to normal salary increases, partly offset by a reduction in full-time equivalent employees, from 371 at September 30, 2018 to 352 at September 30, 2019, as part of management’s continued initiative to manage headcount throughout the organization. Occupancy expense increased by $157,000, or 6.3 percent, to $2.6 million for the third quarter of 2019 from $2.5 million for the third quarter a year earlier, largely related to the opening of three new branches in 2019.

The income tax provision increased by $319,000, or 15.6 percent, to $2.4 million for the third quarter of 2019 from $2.0 million for the third quarter of 2018. The increase in the income tax provision comes as a result of higher taxable income for the third quarter of 2019 as compared to that same period for 2018. The consolidated effective tax rate for the third quarter of 2019 was 31.1 percent compared to 30.8 percent for the third quarter a year ago.
Year to Date Income Statement Review
Net interest income increased by $6.0 million, or 10.6 percent, to $62.5 million for first nine months of 2019 from $56.5 million for the first nine months of 2018. Net interest margin was 3.14 percent for the first nine months of 2019 compared to 3.34 percent for the first nine months of 2018. The decrease in the net interest margin was the result of a comparatively higher interest rate environment, with the increase in the average cost of funds outpacing the return on interest earning assets for the nine-month period ended September 30, 2019 as compared to the same period one year ago. Interest income on loans also included $1.5 million of amortization of purchase credit adjustments related to the acquisition of IAB for the nine months ended September 30, 2019, which added approximately eight basis points to the average yield on interest earning assets on an annualized basis.
Total non-interest income decreased by $2.4 million, or 35.7 percent, to $4.4 million for the first nine months of 2019 from $6.8 million for the first nine months 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 92.5 percent, to $179,000 for the first nine months of 2019 from $2.4 million for the first nine months a year ago. 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 $1.1 million or 2.5 percent, to $41.3 million for the first nine months of 2019 from $42.4 million for the first nine months of 2018. There were no merger-related expenses in the first nine months of 2019, compared to $2.3 million in the first nine months of 2018.  “Excluding the prior-year merger costs, total non-interest expense rose 3.1% over last year. Management is pleased with the results of our cost containment efforts. The increase would be less considering that the prior year did not include IAB non-interest costs until the merger date of April 17, 2018,” Coughlin stated.
The income tax provision increased by $2.0 million, or 40.1 percent, to $7.1 million for the first nine months of 2019 from $5.1 million for the first nine months of 2018. The increase in the income tax provision comes as a result of higher taxable income for the first nine months ended September 30, 2019 as compared to that same period for 2018. The consolidated effective tax rate for the first nine months of 2019 was 30.9 percent compared to 30.6 percent for the first nine months of 2018.

BCBP Reports Third Quarter 2019 Earnings
October 18, 2019
Page 4

Asset Quality
The provision for loan losses remained relatively flat at $900,000 for the third quarter of 2019 as compared to $907,000 for the third quarter of 2018.  Year-to-date, the provision for loan losses decreased by $1.8 million, to $2.5 million for the first nine months of 2019 from $4.3 million for the first nine months of 2018, mainly related to the loan growth curtailment. Non-accruing loans improved to $5.1 million, or 0.22 percent, of gross loans at September 30, 2019 as compared to $11.1 million, or 0.49 percent, of gross loans at September 30, 2018.
Performing troubled debt restructured (“TDR”) loans that were not included in nonaccrual loans at September 30, 2019, were $16.5 million, compared to $21.8 million at June 30, 2019 and $20.6 million at September 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 $24.7 million, or 486.6 percent of non-accruing loans and 1.08 percent of gross loans, at September 30, 2019 as compared to an allowance for loan losses of $23.8 million, or 433.5 percent of non-accruing loans and 1.02 percent of gross loans, at June 30, 2019 and an allowance for loan losses of $21.5 million or 193.9 percent of non-accruing loans and 0.96 percent of gross loans, a year ago.
The Company recognized net recoveries of $2,000 during the third quarter of 2019. This compares to net recoveries of $30,000 in the second quarter of 2019 and net charge offs of $43,000 in the third quarter a year ago. Year-to-date, the Company recognized $212,000 in net charge-offs compared to $180,000 in net charge-offs in the first nine 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.
In September 2019, the Company announced its inclusion into the prestigious Sandler O'Neill Sm-All Stars Class of 2019, an elite group of 30 publicly traded small-cap banks and thrifts, based on growth, profitability, credit quality and capital strength.
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 Third Quarter 2019 Earnings
October 18, 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 release, 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 Third Quarter 2019 Earnings
October 18, 2019
Page 6

 
Statements of Income  - Three Months Ended,
 
September 30, 2019
June 30, 2019
September 30, 2018
September 30, 2019 vs.
June 30, 2019
September 30, 2019 vs. September 30, 2018
Interest and dividend income:
(Dollars in thousands)
   Loans, including fees
 $                        28,860
 $                           28,634
 $                               26,019
0.8%
10.9%
  Mortgage-backed securities
                                 652
                                   738
                                       827
-11.7%
-21.2%
  Other investment securities
                                 107
                                   197
                                       116
-45.7%
-7.8%
  FHLB stock and other interest earning assets
                              1,750
                                1,173
                                    1,009
49.2%
73.4%
      Total interest and dividend income
                            31,369
                              30,742
                                  27,971
2.0%
12.1%
           
 Interest expense:
         
  Deposits:
         
     Demand
                              1,898
                                1,750
                                    1,130
8.5%
68.0%
     Savings and club
                                 102
                                   110
                                       116
-7.3%
-12.1%
      Certificates of deposit
                              6,603
                                6,097
                                    4,591
8.3%
43.8%
 
                              8,603
                                7,957
                                    5,837
8.1%
47.4%
      Borrowings
                              2,006
                                1,920
                                    2,054
4.5%
-2.3%
       Total interest expense
                            10,609
                                9,877
                                    7,891
7.4%
34.4%
           
Net interest income
                            20,760
                              20,865
                                  20,080
-0.5%
3.4%
 Provision for loan losses
                                 900
                                   755
                                       907
19.2%
-0.8%
           
 Net interest income after provision for loan losses
                            19,860
                              20,110
                                  19,173
-1.2%
3.6%
           
 Non-interest income:
         
  Fees and service charges
                                 855
                                   802
                                    1,092
6.6%
-21.7%
  Gain on sales of loans
                                    89
                                   437
                                       738
-79.6%
-87.9%
  Gain on sales of other real estate owned
                                 124
                                     45
                                         14
175.6%
                                         7.86
  Gain on sale of investment securities
                                 283
                                     21
                                          -
1247.6%
0.0%
  Unrealized (loss) on equity investments
                                  (45)
                                   (26)
                                        (82)
73.1%
-45.1%
  Other
                                    77
                                     49
                                         90
57.1%
-14.4%
       Total non-interest income
                              1,383
                                1,328
                                    1,852
4.1%
-25.3%
           
 Non-interest expense:
         
   Salaries and employee benefits
                              7,294
                                6,918
                                    7,156
5.4%
1.9%
    Occupancy and equipment
                              2,647
                                2,649
                                    2,490
-0.1%
6.3%
   Data processing and service fees
                                 776
                                   731
                                       942
6.2%
-17.6%
    Professional fees
                                 368
                                   473
                                       437
-22.2%
-15.8%
   Director fees
                                 356
                                   316
                                       192
12.7%
85.4%
    Regulatory assessments
                                  (91)
                                   417
                                       419
-121.8%
-121.7%
   Advertising and promotional
                                    64
                                   123
                                       129
-48.0%
-50.4%
   Other real estate owned, net
                                  (31)
                                   124
                                         22
-125.0%
-240.9%
   Merger related costs
                                     -
                                      -
                                       119
                                          -
-100.0%
    Other
                              2,269
                                2,143
                                    2,485
5.9%
-8.7%
      Total non-interest expense
                            13,652
                              13,894
                                  14,391
-1.7%
-5.1%
           
Income before income tax provision
                              7,591
                                7,544
                                    6,634
0.6%
14.4%
 Income tax provision
                              2,359
                                2,317
                                    2,040
1.8%
15.6%
           
 Net Income
 $                           5,232
 $                             5,227
 $                                 4,594
0.1%
13.9%
Preferred stock dividends
                                 342
                                   342
                                       263
                                          -
30.0%
 Net Income available to common stockholders
 $                           4,890
 $                             4,885
 $                                 4,331
0.1%
12.9%
           
 Net Income per common share-basic and diluted
         
Basic
 $                             0.30
 $                               0.30
 $                                   0.27
                                          -
11.1%
   Diluted
 $                             0.30
 $                               0.30
 $                                   0.27
                                          -
11.1%
           
 Weighted average number of common shares outstanding
         
Basic
                            16,468
                              16,413
                                  15,789
0.3%
4.3%
   Diluted
                            16,523
                              16,471
                                  15,896
0.3%
3.9%



BCBP Reports Third Quarter 2019 Earnings
October 18, 2019
Page 7

 
Nine Months Ended,
 
 
September 30, 2019
September 30, 2018
September 30, 2019 vs.
September 30, 2018
Interest and dividend income:
(Dollars in thousands)
   Loans, including fees
 $                        85,727
 $                          69,588
23.2%
  Mortgage-backed securities
                              2,160
                               2,363
-8.6%
  Other investment securities
                                 432
                                  416
3.8%
  FHLB stock and other interest earning assets
                              4,270
                               2,242
90.5%
      Total interest and dividend income
                            92,589
                             74,609
24.1%
       
 Interest expense:
     
  Deposits:
     
      Demand
                              5,224
                               2,902
80.0%
     Savings and club
                                 325
                                  318
2.2%
      Certificates of deposit
                            18,690
                             10,726
74.2%
 
                            24,239
                             13,946
73.8%
      Borrowings
                              5,823
                               4,153
40.2%
       Total interest expense
                            30,062
                             18,099
66.1%
       
Net interest income
                            62,527
                             56,510
10.6%
 Provision for loan losses
                              2,544
                               4,309
-41.0%
       
 Net interest income after provision for loan losses
                            59,983
                             52,201
14.9%
       
 Non-interest income:
     
   Fees and service charges
                              2,540
                               2,773
-8.4%
   Gain on sales of loans
                                 844
                               1,897
-55.5%
   Gain (loss) on bulk sale of impaired loans held in portfolio
                                 107
                                   (24)
545.8%
   Gain on sales of other real estate owned
                                 177
                                      4
4325.0%
   Gain on sale of investment securities
                                 304
                                     -
                                            -
   Unrealized gain (loss) on equity investments
                                 220
                                 (242)
190.9%
   Other
                                 179
                               2,393
-92.5%
       Total non-interest income
                              4,371
                               6,801
-35.7%
       
 Non-interest expense:
     
   Salaries and employee benefits
                            21,127
                             20,548
2.8%
    Occupancy and equipment
                              7,926
                               7,028
12.8%
   Data processing and service fees
                              2,228
                               2,499
-10.8%
    Professional fees
                              1,374
                               1,475
-6.8%
   Director fees
                                 990
                                  594
66.7%
    Regulatory assessments
                                 783
                                  948
-17.4%
   Advertising and promotional
                                 260
                                  314
-17.2%
    Other real estate owned, net
                                    77
                                  213
-63.8%
   Merger related costs
                                     -
                               2,303
-100.0%
    Other
                              6,558
                               6,460
1.5%
      Total non-interest expense
                            41,323
                             42,382
-2.5%
       
Income before income tax provision
                            23,031
                             16,620
38.6%
 Income tax provision
                              7,121
                               5,081
40.1%
       
 Net Income
 $                        15,910
 $                          11,539
37.9%
Preferred stock dividends
                              1,002
                                  691
45.0%
 Net Income available to common stockholders
 $                        14,908
 $                          10,848
37.4%
       
 Net Income per common share-basic and diluted
     
Basic
 $                             0.91
 $                              0.70
30.0%
   Diluted
 $                             0.91
 $                              0.69
31.9%
       
 Weighted average number of common shares outstanding
   
Basic
                            16,320
                             15,482
5.4%
   Diluted
                            16,369
                             15,609
4.9%





BCBP Reports Third Quarter 2019 Earnings
October 18, 2019
Page 8


Statements of Financial Condition
September 30, 2019
June 30, 2019
September 30, 2018
September 30, 2019 vs June 30, 2019
September 30, 2019 vs September 30, 2018
 ASSETS
(Dollars in thousands)
 Cash and amounts due from depository institutions
 $                        27,625
 $                         20,660
 $                          32,459
33.7%
-14.9%
Interest-earning deposits
                         348,986
                          206,982
                           174,251
68.6%
100.3%
    Total cash and cash equivalents
                         376,611
                          227,642
                           206,710
65.4%
82.2%
           
 Interest-earning time deposits
                                 735
                                 735
                                  980
                                     -
-25.0%
Debt securities available for sale
                            98,218
                          116,258
                           119,811
-15.5%
-18.0%
 Equity investments
                              5,857
                              5,901
                               8,052
-0.7%
-27.3%
Loans held for sale
                              3,195
                                    -
                               1,772
-
80.3%
 Loans receivable, net of allowance for loan losses
         
   of $24,691, $23,789, and $21,504, respectively
                      2,253,699
                       2,299,765
                        2,225,001
-2.0%
1.3%
 Federal Home Loan Bank of New York stock, at cost
                            15,171
                            13,821
                             14,755
9.8%
2.8%
Premises and equipment, net
                            20,315
                            19,482
                             20,392
4.3%
-0.4%
 Operating lease right-of-use asset
                            13,951
                            14,650
                                     -
-4.8%
                                         -
Accrued interest receivable
                              8,959
                              9,315
                               8,635
-3.8%
3.8%
 Other real estate owned
                                     -
                              1,235
                               1,232
-100.0%
-100.0%
Deferred income taxes
                            13,445
                            12,962
                             11,607
3.7%
15.8%
 Goodwill and other intangibles
                              5,570
                              5,587
                               5,223
-0.3%
6.6%
 Other assets
                              9,773
                            10,777
                             13,698
-9.3%
-28.7%
     Total Assets
 $                   2,825,499
 $                    2,738,130
 $                     2,637,868
3.2%
7.1%
           
LIABILITIES AND STOCKHOLDERS' EQUITY
         
           
LIABILITIES
         
 Non-interest bearing deposits
 $                      276,235
 $                       278,602
 $                        276,998
-0.8%
-0.3%
Interest bearing deposits
                      1,987,222
                       1,929,620
                        1,839,626
3.0%
8.0%
   Total deposits
                      2,263,457
                       2,208,222
                        2,116,624
2.5%
6.9%
FHLB advances
                         275,800
                          245,800
                           275,800
12.2%
-
 Subordinated debentures
                            36,752
                            36,693
                             36,519
0.2%
0.6%
 Operating lease liability
                            14,054
                            14,724
                                     -
-4.6%
-
 Other liabilities
                            11,717
                            11,538
                             13,162
1.6%
-11.0%
     Total Liabilities
                      2,601,780
                       2,516,977
                        2,442,105
3.4%
6.5%
           
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
                         177,253
                          176,767
                           175,970
0.3%
0.7%
Retained earnings
                            45,947
                            43,347
                             35,693
6.0%
28.7%
 Accumulated other comprehensive (loss)
                            (2,449)
                             (1,929)
                             (6,490)
27.0%
-62.3%
Treasury stock, at cost
                          (22,048)
                           (22,048)
                           (29,116)
                                     -
-24.3%
     Total Stockholders' Equity
                         223,719
                          221,153
                           195,763
1.2%
14.3%
           
      Total Liabilities and Stockholders' Equity
 $                   2,825,499
 $                    2,738,130
 $                     2,637,868
3.2%
7.1%
           
Outstanding common shares
                            16,477
                            16,461
                             15,799
0.1%
4.3%



BCBP Reports Third Quarter 2019 Earnings
October 18, 2019
Page 9

   
Three Months Ended September 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
$
 2,309,703
 
$
 28,860
 
5.00%
 
$
 2,183,872
 
$
 26,019
 
4.77%
Investment Securities
 
 111,551
   
 759
 
2.72%
   
 148,540
   
 943
 
2.54%
Interest-earning deposits
 
 289,080
   
 1,750
 
2.42%
   
 164,944
   
 1,009
 
2.45%
   Total Interest-earning assets
 
 2,710,334
   
 31,369
 
4.63%
   
 2,497,356
   
 27,971
 
4.48%
Non-interest-earning assets
 
 75,904
             
 63,729
         
   Total assets
$
 2,786,238
           
$
 2,561,085
         
Interest-bearing liabilities:
                             
Interest-bearing demand accounts
$
 344,439
 
$
 661
 
0.77%
 
$
 336,373
 
$
 504
 
0.60%
Money market accounts
 
 269,775
   
 1,237
 
1.84%
   
 195,436
   
 626
 
1.28%
Savings accounts
 
 257,392
   
 102
 
0.16%
   
 265,610
   
 116
 
0.17%
Certificates of Deposit
 
 1,095,481
   
 6,603
 
2.41%
   
 969,475
   
 4,591
 
1.89%
   Total interest-bearing deposits
 
 1,967,087
   
 8,603
 
1.75%
   
 1,766,894
   
 5,837
 
1.32%
Borrowed funds
 
 298,152
   
 2,006
 
2.69%
   
 324,767
   
 2,054
 
2.53%
   Total interest-bearing liabilities
 
 2,265,239
   
 10,609
 
1.87%
   
 2,091,661
   
 7,891
 
1.51%
Non-interest-bearing liabilities
 
 299,230
             
 274,850
         
   Total liabilities
 
 2,564,469
             
 2,366,511
         
Stockholders' equity
 
 221,769
             
 194,574
         
   Total liabilities and stockholders' equity
$
 2,786,238
           
$
 2,561,085
         
Net interest income
     
$
 20,760
           
$
 20,080
   
Net interest rate spread(1)
           
2.76%
             
2.97%
Net interest margin(2)
           
3.06%
             
3.22%
                               
                               

(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 Third Quarter 2019 Earnings
October 18, 2019
Page 10

   
Nine Months Ended September 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
$
 2,318,047
 
$
 85,727
 
4.93%
 
$
 1,983,562
 
$
 69,588
 
4.68%
Investment Securities
 
 120,560
   
 2,592
 
2.87%
   
 142,712
   
 2,779
 
2.60%
Interest-earning deposits
 
 220,318
   
 4,270
 
2.58%
   
 127,977
   
 2,242
 
2.34%
   Total Interest-earning assets
 
 2,658,925
   
 92,589
 
4.64%
   
 2,254,251
   
 74,609
 
4.41%
Non-interest-earning assets
 
 72,718
             
 53,375
         
   Total assets
$
 2,731,643
           
$
 2,307,626
         
Interest-bearing liabilities:
                             
Interest-bearing demand accounts
$
 342,515
 
$
 1,913
 
0.74%
 
$
 328,908
 
$
 1,402
 
0.57%
Money market accounts
 
 253,593
   
 3,311
 
1.74%
   
 179,290
   
 1,500
 
1.12%
Savings accounts
 
 259,093
   
 325
 
0.17%
   
 263,156
   
 318
 
0.16%
Certificates of Deposit
 
 1,079,090
   
 18,690
 
2.31%
   
 859,949
   
 10,726
 
1.66%
   Total interest-bearing deposits
 
 1,934,291
   
 24,239
 
1.67%
   
 1,631,303
   
 13,946
 
1.14%
Borrowed funds
 
 288,399
   
 5,823
 
2.69%
   
 245,567
   
 4,153
 
2.26%
   Total interest-bearing liabilities
 
 2,222,690
   
 30,062
 
1.80%
   
 1,876,870
   
 18,099
 
1.29%
Non-interest-bearing liabilities
 
 293,557
             
 243,973
         
   Total liabilities
 
 2,516,247
             
 2,120,843
         
Stockholders' equity
 
 215,396
             
 186,783
         
   Total liabilities and stockholders' equity
$
 2,731,643
           
$
 2,307,626
         
Net interest income
     
$
 62,527
           
$
 56,510
   
Net interest rate spread(1)
           
2.84%
             
3.13%
Net interest margin(2)
           
3.14%
             
3.34%
                               

(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 Third Quarter 2019 Earnings
October 18, 2019
Page 11

 
Financial condition data by quarter
 
Q3 2019
Q2 2019
Q1 2019
Q4 2018
Q3 2018
 
(In thousands, except tangible book value)
Total assets
 $       2,825,499
 $       2,738,130
 $       2,718,400
 $       2,674,731
 $       2,637,868
Cash and cash equivalents
376,611
227,642
193,548
195,264
206,710
Securities
104,075
122,159
125,905
127,007
127,863
Loans receivable, net
2,253,699
2,299,765
2,307,140
2,278,492
2,225,001
Deposits
2,263,457
2,208,222
2,188,633
2,180,724
2,116,624
Borrowings
312,552
282,493
282,435
282,377
312,319
Stockholders’ equity
223,719
221,153
216,718
200,215
195,763
Tangible Book Value
11.72
11.58
11.35
11.00
10.78
           
 
Operating data by quarter
 
Q3 2019
Q2 2019
Q1 2019
Q4 2018
Q3 2018
 
(In thousands, except for per share amounts)
Net interest income
 $             20,760
 $             20,865
 $             20,902
 $             21,171
 $             20,080
Provision for loan losses
                      900
                      755
                      889
                      821
                      907
Non-interest income
1,383
1,328
1,660
1,159
1,852
Non-interest expense
13,652
13,894
13,777
13,884
14,391
Income tax expense
2,359
2,317
2,445
2,401
2,040
Net income
 $               5,232
 $               5,227
 $               5,451
 $               5,224
 $               4,594
Net income per diluted share
 $                 0.30
 $                 0.30
 $                 0.32
 $                 0.31
 $                 0.27
Common Dividends declared per share
 $                 0.14
 $                 0.14
 $                 0.14
 $                 0.14
 $                 0.14
           
 
Financial Ratios
 
Q3 2019
Q2 2019
Q1 2019
Q4 2018
Q3 2018
Return on average assets
0.75%
0.77%
0.81%
0.78%
0.72%
Return on average stockholder’s equity
9.44%
9.61%
10.55%
10.66%
9.44%
Net interest margin
3.06%
3.16%
3.18%
3.24%
3.22%
Stockholder’s equity to total assets
7.92%
8.08%
7.97%
7.49%
7.42%
Efficiency Ratio
61.65%
62.61%
61.06%
62.18%
65.62%
           
 
Asset Quality Ratios
 
(In thousands, except for ratio %)
 
Q3 2019
Q2 2019
Q1 2019
Q4 2018
Q3 2018
Non-Accrual Loans
 $               5,074
 $               5,488
 $               5,670
 $               7,221
 $             11,093
Non-Accrual Loans as a % of Total Loans
0.22%
0.24%
0.24%
0.31%
0.49%
ALLL as % of Non-Accrual Loans
486.62%
433.47%
405.71%
309.64%
193.85%
Impaired Loans
                30,856
                37,275
                40,533
                42,408
                47,251
Classified Loans
                15,998
                22,679
                23,977
                26,161
                30,179


BCBP Reports Third Quarter 2019 Earnings
October 18, 2019
Page 12

 
Recorded Investment in Loans Receivable by quarter
 
Q3 2019
Q2 2019
Q1 2019
Q4 2018
Q3 2018
   (In Thousands) 
Residential one-to-four family
 $              252,971
 $              258,688
 $              258,184
 $              258,085
 $              254,149
Commercial and multi-family
1,668,982
1,702,132
1,724,326
1,697,837
1,701,105
Construction
131,697
134,963
114,462
107,783
75,601
Commercial business
161,649
164,569
167,067
165,193
142,312
Home equity
63,645
63,927
66,946
72,895
73,714
Consumer
728
727
731
809
1,368
 
 $           2,279,672
 $           2,325,006
 $           2,331,716
 $           2,302,602
 $           2,248,249
Less:
         
   Deferred loan fees, net
                     (1,282)
                     (1,452)
                     (1,572)
                     (1,751)
                     (1,744)
   Allowance for loan loss
                  (24,691)
                  (23,789)
                  (23,004)
                  (22,359)
                  (21,504)
           
Total loans, net
 $           2,253,699
 $           2,299,765
 $           2,307,140
 $           2,278,492
 $           2,225,001
           
 
Non-Accruing Loans in Portfolio by quarter
 
Q3 2019
Q2 2019
Q1 2019
Q4 2018
Q3 2018
   (In Thousands)  
Originated loans:
         
   Residential one-to-four family
 $                      814
 $                   1,022
 $                   1,415
 $                   1,160
 $                   1,457
   Commercial and multi-family
1,584
1,881
1,364
2,568
5,572
Commercial business
                          887
                          745
                          256
                          356
                          251
Home equity
                          350
                          129
                          272
                          277
                          338
Sub-total:
 $                   3,635
 $                   3,777
 $                   3,307
 $                   4,361
 $                   7,618
           
Acquired loans initially recorded at fair value:
       
   Residential one-to-four family
 $                   1,046
 $                   1,116
 $                   1,704
 $                   2,165
 $                   2,590
   Commercial and multi-family
                             -
                             -
                          597
                          605
                          590
Commercial business
                          378
                          378
                             -
                            48
                          295
Home equity
                            15
                          217
                            62
                            42
                             -
Sub-total:
 $                   1,439
 $                   1,711
 $                   2,363
 $                   2,860
 $                   3,475
           
Total:
 $                   5,074
 $                   5,488
 $                   5,670
 $                   7,221
 $                 11,093


BCBP Reports Third Quarter 2019 Earnings
October 18, 2019
Page 13

 
Reconciliation of GAAP to Non-GAAP Financial Measures by quarter
           
 
Tangible Book Value per Share
 
Q3 2019
Q2 2019
Q1 2019
Q4 2018
Q3 2018
   
(In Thousands, except per share amounts)
 
Total Stockholders' Equity
 $              223,719
 $              221,153
 $              216,718
 $              200,215
 $              195,763
Less: goodwill and other intangibles
5,570
5,587
5,584
5,699
5,714
Less: preferred stock
25,016
25,016
25,016
19,706
19,706
Total tangible stockholders' equity
193,133
190,550
186,118
174,810
170,343
Shares outstanding
                    16,477
                    16,461
                    16,398
                    15,889
                    15,799
Book value per share
 $                   13.58
 $                   13.43
 $                   13.22
 $                   12.60
 $                   12.39
Tangible book value per share
 $                   11.72
 $                   11.58
 $                   11.35
 $                   11.00
 $                   10.78
           
 
Efficiency Ratios
 
Q3 2019
Q2 2019
Q1 2019
Q4 2018
Q3 2018
   (In Thousands)  
Net interest income
 $                 20,760
 $                 20,865
 $                 20,902
 $                 21,171
 $                 20,080
Non-interest income
1,383
1,328
1,660
1,159
1,852
Total income
                    22,143
                    22,193
                    22,562
                    22,330
                    21,932
Non-interest expense
                    13,652
                    13,894
                    13,777
                    13,884
                    14,391
Efficiency Ratio
61.65%
62.61%
61.06%
62.18%
65.62%





Transmitted on Globe Newswire on October 18, 2019 at 4:15 p.m. Eastern Daylight Time.
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