Gouverneur Bancorp Announces Fiscal 2010 Results
GOUVERNEUR, N.Y., Dec. 3, 2010 /PRNewswire-FirstCall/ -- Charles C. Van Vleet Jr., President and Chief Executive Officer of Gouverneur Bancorp, Inc. (OTC Bulletin Board: GOVB) (the "Company") holding company for Gouverneur Savings and Loan Association (the "Bank"), announced today results for its fiscal year ended September 30, 2010.
Net income for the fiscal year ended September 30, 2010 increased 28.8% to $1,663,000, or $0.74 per diluted share, compared to $1,291,000, or $0.56 per diluted share, in fiscal 2009. The return on average assets and average equity increased to 1.14% and 7.46%, respectively, for the year ended September 30, 2010 from 0.93% and 6.04%, respectively, for the year ended September 30, 2009. Total assets grew by $3.2 million, or 2.2%, from $143.7 million at September 30, 2009 to $146.9 million at September 30, 2010, while net loans increased $0.3 million, or 0.26%, from $114.1 million to $114.4 million over the same period.
Commenting on the results for the year, Mr. Van Vleet said, "We are pleased with our results for the 2010 fiscal year. The Bank continues to be profitable, has sound credit quality, and has not experienced any shrinkage in the loan portfolio. We continue to operate as a community bank by serving the needs of our local customers. Being a community bank and working with the people of the surrounding communities in this economic downturn has been a benefit for all. The community bank model continues to show its strength in this declining economic environment, unlike the 'too big to fail' models. However, as we look towards a future with an uncertain economic outlook and new regulatory environment, we expect to see additional strain being placed on the Bank's profitability."
Gouverneur Savings and Loan remains well-capitalized with a core capital ratio of 15.6%, an increase of 0.60% from 2009. Strong asset composition with non-performing assets represented only 1.13% of total assets, slightly higher than last year's 0.99%.
In fiscal 2010, interest income increased $223,000, or 2.9%, from $7,811,000 to $8,034,000, while interest expense decreased $789,000, or 27.2%, from $2,902,000 to $2,113,000. Interest spread, the difference between the rate earned on interest-earning assets and the rate paid on interest-bearing liabilities, was 4.11% in fiscal 2010 and 3.38% in fiscal 2009.
Non-interest income increased $59,000 from $865,000 in fiscal year 2009 to $924,000 in fiscal 2010. Increases in the value of the underlying investments in the deferred directors fees plan resulted in the gain.
Although non-performing loans increased in fiscal 2010, the quality of our loan portfolio has remained strong. Net loans grew $0.3 million in fiscal 2010 as compared to growth of $3.6 million in fiscal 2009. We made a $205,000 provision for loan losses in fiscal 2010 and a $60,000 provision in the 2009 fiscal year. Non-performing loans were $1,140,000 at September 30, 2010, compared to $750,000 at September 30, 2009. Net charge-offs were $153,000 for the year ended September 30, 2010. The allowance for loan losses was $849,000, or 0.74% of total loans outstanding at September 30, 2010 as compared to $797,000, or 0.70% at September 30, 2009.
The components of non-interest expense are presented in the following table:
For the year ended
Salaries and employee benefits
Building, occupancy and equipment
Other operating expense
Non interest expense
Salaries and employee benefits expense increased by $244,000 in fiscal 2010 mainly due to performance increases to employees, increased pension and retirement benefit expense and an increase in other employee benefit costs of $150,000, $75,000 and $60,000, respectively. The increase in other operating expense resulted mostly from an increase in the values of the underlying investments in the deferred directors fees plan and increased loss on real estate owned of $54,000 and $46,000 respectively.
Deposits increased $0.5 million, or 0.47%, to $91.9 million at September 30, 2010 from $91.4 million at September 30, 2009 including a decrease of $0.3 million in brokered deposits from $1.3 million last year to $1.0 million this year. Securities sold under agreements to repurchase with the Federal Home Loan Bank of New York ("FHLB") were $3.0 million and $5.0 million at September 30, 2010 and 2009, respectively. Advances from the FHLB increased $3.0 million from $22.0 million to $25.0 million over the same period as the Company implemented its 2010 Business Plan to purchase $5.0 million in investments funded by low-cost FHLB borrowings.
Shareholders' equity was $23.0 million at September 30, 2010, representing an increase of 5.1% over the September 30, 2009 balance of $21.9 million. The Company's book value was $10.22 per common share based on 2,246,946 shares issued and outstanding at September 30, 2010 versus $9.60 on 2,277,199 shares issued and outstanding on September 30, 2009. The Company paid cash dividends totaling $0.34 per share to all public holders of our stock, while Cambray Mutual Holding Company, our majority shareholder, waived its right to receive dividends during the fiscal year ending September 30, 2010.
The Company, which is headquartered in Gouverneur, New York, is the holding company for Gouverneur Savings and Loan Association. Founded in 1892, the Bank is a federally chartered savings and loan association offering a variety of banking products and services to individuals and businesses in its primary market area in southern St. Lawrence and northern Lewis and Jefferson Counties in New York State.
Statements in this news release contain forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements are based on the beliefs of management as well as assumptions made using information currently available to management. Since these statements reflect the views of management concerning future events, these statements involve risks, uncertainties and assumptions. These risks and uncertainties include among others, the impact of changes in market interest rates and general economic conditions, changes in government regulations, changes in accounting principles and the quality or composition of the loan and investment portfolios. Therefore, actual future results may differ significantly from results discussed in the forward-looking statements.
SOURCE Gouverneur Bancorp, Inc.