Parke Bancorp, Inc. Announces Record Earnings For 2015

Jan 25, 2016, 16:10 ET from Parke Bancorp, Inc.

WASHINGTON TOWNSHIP, N.J., Jan. 25, 2016 /PRNewswire/ -- Parke Bancorp, Inc. ("Parke Bancorp") (NASDAQ: PKBK), the parent company of Parke Bank, announced its operating results for the quarter and year ended December 31, 2015.

Parke Bancorp reported net income available to common shareholders of $9.5 million, or $1.56 per common share and $1.34 per diluted common share, for the year ended December 31, 2015. This compares to $9.3 million, or $1.55 per common and $1.32 per diluted share, for the year ended December 31, 2014, an increase in net income of 2.4%.

For the quarter ended December 31, 2015, net income available to common shareholders was $2.9 million, or $0.48 per common share and $0.40 per diluted common share, compared to net income of $1.9 million, or $0.32 per common and $0.28 per diluted common share for the quarter ended December 31, 2014, an increase in quarterly net income of 54.6%.

The following is a recap of significant items that impacted the fourth quarter of 2015 compared to the same quarter last year: a $665,000 increase in net interest income, primarily attributable to higher loan volumes; a $1.0 million decrease in the provision for loan losses, due to improving credit trends; and a $766,000 decrease in noninterest expense primarily attributable to lower Other Real Estate Owned ("OREO") expenses, partially offset by an increase in the loss on sale of OREO of $301,000.

At December 31, 2015, Parke Bancorp's total assets increased to $885.1 million from $821.7 million at December 31, 2014, an increase of $63.4 million, or 7.7%, primarily due to an increase in loans.

Parke Bancorp's total investment securities portfolio increased to $44.7 million at December 31, 2015 from $30.3 million at December 31, 2014, an increase of $14.4 million or 47.4%. During the first quarter of 2015, the Company purchased $20.7 million of mortgage-backed securities to bolster on-balance sheet liquidity to fund future growth. The purchase was funded with borrowings from the FHLB.

Parke Bancorp's total loans increased to $758.5 million at December 31, 2015 from $713.1 million at December 31, 2014, an increase of $45.4 million or 6.4%.

At December 31, 2015, Parke Bancorp had $13.6 million in nonperforming loans representing 1.8% of total loans, a decrease of $13.3 million or 49.6% from $26.9 million at December 31, 2014. OREO at December 31, 2015 was $16.6 million, compared to $20.9 million at December 31, 2014 a decrease of 20.6%. OREO consisted of 16 properties, the largest being a condominium development in Absecon, NJ, recorded at $6.4 million. Nonperforming assets (consisting of nonperforming loans and OREO) represented 3.4% of total assets at December 31, 2015 as compared to 5.8% of total assets at December 31, 2014. Loans past due 30 to 89 days were $1.2 million at December 31, 2015, a decrease of $40,000 from the previous quarter end and a decrease of $1.7 million from December 31, 2014.

At December 31, 2015, Parke Bancorp's allowance for loan losses was $16.1 million, as compared to $18.0 million at December 31, 2014. The ratio of allowance for loan losses to total loans was 2.1% at December 31, 2015 compared to 2.5% at December 31, 2014. The decrease is due to the charge-off of previously-established specific reserves and the continuing improvements in the credit quality of the loan portfolio. The ratio of allowance for loan losses to non-performing loans improved to 119.0% at December 31, 2015, compared to 67.1%, at December 31, 2014.

BOLI increased to $23.8 million at December 31, 2015, from $11.5 million at December 31, 2014, an increase of $12.3 million or 107.8%. The Company increased its position by $12.0 million in the fourth quarter in order to offset the rising cost of employee benefits.

At December 31, 2015, Parke Bancorp's total deposits were $665.2 million, up from $647.9 million at December 31, 2014, an increase of $17.3 million or 2.7%.

Parke Bancorp's total borrowings increased to $98.1 million at December 31, 2015 from $62.8 million at December 31, 2014, an increase of $35.3 million or 56.2% due to the additional borrowings used to fund the mortgage-backed securities purchases described above.

Total shareholders' equity increased to $112.0 million at December 31, 2015 from $102.9 million at December 31, 2014, an increase of $9.1 million or 8.9%.

Vito S. Pantilione, President and Chief Executive Officer of Parke Bancorp and Parke Bank, provided the following statement:

"2015 was a very challenging year in the banking industry. Net interest margins continued to compress, regulatory costs continued to escalate and online lending competition increased dramatically. Parke Bank faced these challenges and we are happy to report our third consecutive year of record earnings. Our core earnings continued to grow as our troubled assets continued to decline. We worked to attain a substantial improvement in our nonperforming loans, reducing them by 50% from December 31, 2014, to $13.6 million. Our OREO decreased year to year over 20% to $16.6 million. Our continued strong earnings combined with our strong capital base have supported our ability to expand our footprint in the Philadelphia area, with a new branch opening planned in Center City Philadelphia and a new state of the art branch that we will be opening soon in Collingswood, NJ. We also enhanced our shareholder value by increasing our cash dividend 17% in 2015. Although there will be many more challenges in 2016, including a volatile world economy, Parke Bank is well positioned to continue taking advantage of opportunities in the market and to grow our bank."

Parke Bancorp, Inc. was incorporated in January 2005, while Parke Bank commenced operations in January 1999. Parke Bancorp and Parke Bank maintain their principal offices at 601 Delsea Drive, Washington Township, New Jersey. Parke Bank conducts business through a branch office in Northfield, New Jersey, two branch offices in Washington Township, New Jersey, a branch office in Galloway Township, New Jersey and a branch in center city Philadelphia. Parke Bank is a full service commercial bank, with an emphasis on providing personal and business financial services to individuals and small-sized businesses primarily in Gloucester, Atlantic and Cape May counties in New Jersey and Philadelphia and surrounding counties in Pennsylvania. Parke Bank's deposits are insured up to the maximum legal amount by the Federal Deposit Insurance Corporation (FDIC). Parke Bancorp's common stock is traded on the NASDAQ Capital Market under the symbol "PKBK".

This release may contain forward-looking statements. Such forward-looking statements are subject to risks and uncertainties which may cause actual results to differ materially from those currently anticipated due to a number of factors including but not limited to: our ability to continue to generate strong net earnings; our ability to continue to reduce our nonperforming loans and delinquencies and the expenses associated with them; our ability to realize a high recovery rate on disposition of troubled assets; our ability to take advantage of opportunities in the improving economy and banking environment; our ability to continue to pay a dividend in the future; our ability to enhance shareholder value in the future; our ability to prudently expand our operations in our market; and our ability to continue to grow our loan portfolio, therefore, readers should not place undue reliance on any forward-looking statements. Parke Bancorp, Inc. does not undertake, and specifically disclaims, any obligations to publicly release the results of any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such circumstance.

 

Statements of Condition Data

December 31, 2015

December 31, 2014

% Change

(in thousands)

Total Assets

$

885,124

$

821,706

7.7%

Cash and cash equivalents

27,429

36,238

-24.3%

Investment securities

44,748

30,349

47.4%

Loans, net of unearned income

758,501

713,061

6.4%

Deposits

665,210

647,933

2.7%

Borrowings

98,053

62,755

56.2%

Total shareholders' equity

112,040

102,905

8.9%

 

Operating Ratios

Three Months Ended December 31,

Twelve Months Ended December 31,

2015

2014

2015

2014

Return on average assets

1.48%

1.08%

1.25%

1.30%

Return on average common equity

12.80%

9.16%

10.82%

11.74%

Interest rate spread

4.03%

3.99%

4.02%

4.43%

Net interest margin

4.16%

4.10%

4.14%

4.53%

Efficiency ratio

40.56%

51.06%

43.57%

47.06%

Asset Quality Data

December 31, 2015

December 31, 2014

(in thousands)

Allowance for loan losses

$

16,136

$

18,043

Allowance for loan losses to total loans

2.13%

2.53%

Non-accrual loans

$

13,559

$

26,892

OREO

$

16,629

$

20,931

 

Statements of Income Data

Three Months Ended December 31,

Twelve Months Ended December 31,

2015

2014

2015

2014

(in thousands)

Interest and dividend income

$

10,159

$

9,373

$

39,410

$

38,132

Interest expense

1,493

1,372

5,812

5,579

Net interest income

8,666

8,001

33,598

32,553

Provision for loan losses

1,000

3,040

3,250

Net interest income after provision for loan losses

8,666

7,001

30,558

29,303

Non-interest income

920

1,116

5,080

7,631

Non-interest expense

3,889

4,655

16,852

18,911

Income before income taxes

5,697

3,462

18,786

18,023

Provision for income taxes

2,204

1,136

6,843

5,711

Net income attributable to Company and noncontrolling interests

3,493

2,326

11,943

12,312

Net income attributable to noncontrolling interests

(247)

(120)

(1,246)

(1,839)

Net income attributable to Company

3,246

2,206

10,697

10,473

Preferred stock dividend and discount

300

300

1,200

1,200

Net income available to common shareholders

2,946

1,906

9,497

9,273

Basic income per common share

0.48

0.32

1.56

1.55

Diluted income per common share

0.40

0.28

1.34

1.32

Weighted shares - basic

6,182,266

5,992,397

6,091,562

5,991,226

Weighted shares - diluted

8,064,667

7,924,384

7,973,588

7,924,859

 

SOURCE Parke Bancorp, Inc.



RELATED LINKS

http://www.parkebank.com