Community National Bank Announces Earnings For First Quarter Of 2013

GREAT NECK, N.Y., April 17, 2013 /PRNewswire/ -- Community National Bank (SYMBOL: CBNY) today announced first quarter results for 2013.  Highlights for the quarter include:

  • Net income of $942 thousand or $0.14 per share for the first quarter of 2013 compared to net income of $527 thousand or $0.08 per share for the same period in 2012. 
  • Net interest income increased 28% or $1.4 million to $6.2 million for the quarter ended March 31, 2013 compared to $4.8 million for the quarter ended March 31, 2012.
  • Return on average assets and equity of 0.55% and 5.24%, respectively, for the quarter ended March 31, 2013 compared to 0.38% and 3.09%, respectively, for the quarter ended March 31, 2012. 
  • Commercial loans grew $98.2 million or 35% to $374.8 million at March 31, 2013 when compared to March 31, 2012.
  • On a linked quarter basis, commercial loans increased $23.2 million or 6.6% when compared to December 31, 2012.
  • Deposits increased $113.0 million or 24% to $588.0 million at March 31, 2013 compared to $475 million at March 31, 2012.
  • Demand deposits grew $53.4 million or 49% to 162.0 million at March 31, 2013 compared to March 31, 2012.
  • Continued strong asset quality with non-performing assets to total assets of 0.15%, which is well below peer group average.

Stuart Lubow, Chairman, President and CEO of Community National Bank commented "The Bank had a solid first quarter with continued growth in the commercial loan portfolio. This growth helped increase net interest income to $6.2 million at March 31, 2013, an increase of $550 thousand or 9.8% when compared to the linked quarter ended December 31, 2012. The first quarter results demonstrated our success in building on the momentum in core earnings from 2012. Service charges increased $104 thousand or 73% to $246 thousand for the quarter ended March 31, 2013 when compared to March 31, 2012. Our commercial loan pipeline remains strong, but the low interest rate environment will continue to create margin compression and loan prepayments in the future." 

Net Earnings and Net Interest Income
Net income for the quarter ended March 31, 2013 was $942 thousand or $0.14 basic earnings per share compared to net income of $527 thousand or $0.08 basic earnings per share for the same period in 2012, an increase of $415 thousand or 79%. The increase reflects higher net interest income predominantly as a result of the Bank's substantial commercial loan growth, increased fees from service charges and gains from the sale of SBA loans.

For the quarter ended March 31, 2013, net interest income increased $1.4 million or 28% to $6.2 million compared to $4.8 million for the quarter ended March 31, 2012. The net interest margin also increased during this same period by 10 basis points to 3.78% compared to 3.68% for the prior year quarter. The increase in net interest income and margin was primarily due to (1) growth in the commercial and residential loan portfolios; (2) an increase in non-interest bearing demand deposits; and (3) continued decline in overall costs of funds on deposits.

Non-Interest Income
Non-interest income increased $289 thousand or 44% to $939 thousand for the quarter ended March 31, 2013 compared to $650 thousand for the prior year period. The increase in non-interest income was attributable to higher gains from the sale of SBA loans, service charges, loan fees and servicing income. 

Non-Interest Expense
Non-interest expense increased $769 thousand or 18% to $4.9 million for the quarter ended March 31, 2013 compared to $4.2 million for the same period in 2012. The increase was primarily attributable to higher compensation and occupancy costs associated with our New York City branch location, which opened in June 2012, the hiring of additional personnel in human resources and operations and rent expense for our new corporate headquarters in Melville.  

Balance Sheet and Asset Quality
Total assets grew to $705.5 million at March 31, 2013, a 20% increase compared to total assets of $587.2 million at March 31, 2012. Total loans increased $118 million or 28% to $542.6 million at March 31, 2013 when compared to March 31, 2012. The commercial loan portfolio increased $98.2 million or 35% when compared to March 31, 2012. The residential loan portfolio increased $19.6 million or 13% when compared to March 31, 2012. Loans were funded by deposits from two new branch locations and the continued development of core banking relationships, which was evident by the $53.4 million rise in demand deposits since March 31, 2012.  

Our asset quality remains strong and is a core focus of management during these uncertain economic times. Non-performing loans, consisting of loans past due 90 days or more, decreased by $0.3 million or 25% to $1.0 million or 0.19% of total loans at March 31, 2013 from $1.3 million or 0.32% at March 31, 2012.

The Bank had $0.6 million in provision for loan losses for the first quarter of 2013. The increase in the provision for loan losses from $0.4 million for the prior year quarter was mostly attributable to general valuation reserves associated with the loan growth during the quarter. The allowance for loan losses was $7.2 million or 1.33% of total loans at March 31, 2013, an increase of $2.0 million from $5.2 million or 1.23% of total loans at March 31, 2012.

Deposits
Total deposits increased $113.0 million or 24% to $588.0 million at March 31, 2013 compared to $475.0 million at March 31, 2012. Demand deposits grew $53.4 million or 49% to $162.0 million at March 31, 2013 when compared to March 31, 2012. 

Further information about the financial condition and performance of Community National Bank is available from its Call Reports filed by the Bank with the FDIC and available on the FDIC website at: http://www2.fdic.gov/idasp/main_bankfind.asp. The Bank expects to file its March 31, 2013 Call Report on or around April 30, 2013.

ABOUT COMMUNITY NATIONAL BANK
Community National Bank is a Long Island based independent commercial bank and operates ten locations in Nassau, Suffolk, Queens and Manhattan County. We offer a full range of modern financial services, backed by state-of-the-art technology. In addition to commercial loans, commercial mortgages, small business loans and lines of credit and residential mortgages, CNB also provides a complete selection of traditional personal and commercial deposit products such as no fee individual and business checking accounts, IRA accounts and statement savings.

Cautionary Statement about Forward-Looking Statements

This release contains certain "forward looking statements" about CNB which, to the extent applicable, are intended to be covered by the safe harbor for forward looking statements provided under the Federal securities laws and, regardless of such coverage, you are cautioned about. Examples of forward-looking statements include but are not limited to, CNB's financial condition, capital ratios, results of operations and outlook. Forward-looking statements are not historical facts. Such statements may be identified by the use of such words as "may," "believe," "expect," "anticipate," "plan," "continue," or similar terminology. These statements relate to future events or our future financial performance and involve risks and uncertainties that may cause our actual results, levels of activity, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we caution you not to place undue reliance on these forward-looking statements. Factors which may cause our forward looking statements to be materially inaccurate include, but are not limited to, a unexpected deterioration in our loan portfolio, unexpected increases in our expenses, greater than anticipated growth, unanticipated regulatory action, unexpected changes in interest rates, a loss of key personnel, an unanticipated loss of existing customers, competition from other institutions causing us unanticipated changes in our deposit or loan rates, increases in FDIC insurance costs and unanticipated adverse changes in our customers' economic conditions or economic conditions in our local area generally. Forward-looking statements speak only as of the date of this press release We do not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

 

COMMUNITY NATIONAL BANK

STATEMENTS OF INCOME

(Unaudited)






For The Three Months Ended


March 31,

December 31,

March 31,


2013

2012

2012

Interest Income:




Commercial Loans

$4,872,995

$4,503,513

$3,740,684

Residential and Consumer Loans

1,647,870

1,626,252

1,628,761

Securities

541,085

541,214

584,850

Money Market Investments

9,715

23,148

7,079

   Total Interest Income

7,071,665

6,694,127

5,961,374





Interest Expense:




NOW, Savings & Money Market

204,820

229,149

203,681

Certificates of Deposit

577,432

649,781

810,241

Borrowed Funds

133,008

125,485

156,470

   Total Interest Expense

915,260

1,004,415

1,170,392

      Net Interest Income

6,156,405

5,689,712

4,790,982

Provision For Loan Losses

620,000

800,000

443,000

Net Interest Income After Provision for Loan Losses

5,536,405

4,889,712

4,347,982





Non-Interest Income:




Service Charges

246,820

189,246

142,018

Servicing and Other Income

155,221

99,005

93,453

Gain on Sale of Investments

29,439

6,788

132,576

Gain on Sale of Loans

346,460

289,091

120,681

Bank Owned Life Insurance ("BOLI")

158,119

196,659

161,262

   Total Non-Interest Income

936,059

780,789

649,990





Non-Interest Expense:




Compensation and Benefits

2,548,069

2,380,164

2,158,476

Occupancy and Equipment

1,302,557

1,141,651

1,071,253

Advertising

41,263

59,419

47,025

Other Expenses

1,073,984

1,039,938

919,930

   Total Non-Interest Expense

4,965,873

4,621,172

4,196,684

Income Before Income Taxes

1,506,591

1,049,329

801,288

Provision For Income Taxes

564,002

356,929

274,200

      Net Income

$942,589

$692,400

$527,088





Earnings Per Share:




   Basic

$0.14

$0.10

$0.08

   Weighted Average Shares Outstanding - Basic

6,673,181

6,673,181

6,673,181

   Diluted

$0.14

$0.10

$0.08

   Weighted Average Shares Outstanding - Diluted

6,745,079

6,701,691

6,684,369

 

 

 

COMMUNITY NATIONAL BANK

STATEMENTS OF CONDITION

(Unaudited)






March 31,

December 31,

March 31,

Assets:

2013

2012

2012

Cash and Due From Banks

$8,223,778

$13,453,651

$6,609,513

Money Market Investments

15,708,308

7,391,467

17,729,766





Securities - Available-for-Sale

104,853,026

100,126,177

105,002,112

Restricted Stock

4,603,950

3,904,850

4,032,100

   Total Securities

109,456,976

104,031,027

109,034,212









Commercial Loans

374,772,120

351,587,251

276,595,897

Residential & Consumer Loans

167,837,569

160,030,011

148,265,104

 Total Loans

542,609,689

511,617,262

424,861,001

Less:  Allowance For Loans Losses

(7,227,875)

(6,606,498)

(5,206,011)

   Net Loans

535,381,814

505,010,764

419,654,990





Premises and Equipment, net

8,614,816

8,709,570

8,744,302

Bank Owned Life Insurance ("BOLI")

19,651,976

19,493,857

17,533,353

Other Assets

8,505,838

7,693,014

7,870,560

   Total Assets

$705,543,506

$665,783,350

$587,176,696





Liabilities and Stockholders' Equity:




Deposits:




Demand

$161,971,063

$155,877,268

$108,594,884

NOW, Savings & Money Market

254,477,223

233,241,844

186,308,006

Certificates of Deposit

171,504,040

174,223,625

180,117,680

   Total Deposits

587,952,326

563,342,737

475,020,570





FHLB Advances

40,462,894

24,970,887

29,477,324

Due to Broker

-

-

10,202,500

Accrued Expenses and Other Liabilities

4,731,800

5,666,170

3,580,877

   Total Liabilities

633,147,020

593,979,794

518,281,271





Stockholders' Equity:




Common Stock, par value $5.00; authorized




10,000,000 shares;  issued 6,673,181 shares

33,365,905

33,365,905

33,365,905

Additional Paid in Capital

34,164,118

34,101,246

33,920,371

Retained Earnings

4,397,881

3,455,292

1,131,119

Unrealized Gain on Securities

468,582

881,113

478,030

      Total Stockholders' Equity

72,396,486

71,803,556

68,895,425

      Total Liabilities and Stockholders' Equity

$705,543,506

$665,783,350

$587,176,696

 

 

COMMUNITY NATIONAL BANK

SELECTED FINANCIAL DATA AND BALANCE SHEET COMPONENTS

(Unaudited)





SELECTED FINANCIAL DATA:

For The Three Months Ended


March 31,

December 31,

March 31,

Per Share:

2013

2012

2012

Net Income - Basic

$0.14

$0.10

$0.08

Average Shares Outstanding - Basic

6,673,181

6,673,181

6,673,181

Net Income - Diluted

$0.14

$0.10

$0.08

Average Shares Outstanding - Diluted

6,745,079

6,701,691

6,684,369

Book Value

$10.85

$10.76

$10.32





Performance:




Return on Average Total Assets

0.55%

0.42%

0.38%

Return on Average Equity

5.24%

3.88%

3.09%

Efficiency Ratio

70.02%

71.42%

77.13%









Yield on Average Earning Assets

4.34%

4.30%

4.58%

Yield on Average Interest Bearing Liabilities

0.81%

0.91%

1.25%

Cost of Deposits

0.54%

0.63%

0.91%

Net Interest Spread

3.53%

3.38%

3.33%

Net Interest Margin

3.78%

3.65%

3.68%






March 31,

December 31,

March 31,

Risk Based Capital:

2013

2012

2012

Leverage Ratio

10.42%

10.35%

11.99%

Tier 1

13.77%

13.85%

16.16%

Total

15.02%

15.10%

17.41%





Asset Quality:




Allowance for Loan Losses to Total Loans

1.33%

1.29%

1.23%

Allowance for Loan Losses to Non-Performing Loans

706%

456%

379%

Non-performing Loans to Total Loans

0.19%

0.28%

0.32%

Non-performing Assets to Total Assets

0.15%

0.22%

0.34%

Annualized Quarterly Net Charge-offs to Average Loans

0.00%

0.08%

0.00%

 

 

 

SOURCE Community National Bank



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