Hilltop Community Bancorp, Inc. Reports Increased Second Quarter Results

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Jul 22, 2013, 11:33 ET

SUMMIT, N.J., July 22, 2013 /PRNewswire/ -- Hilltop Community Bancorp, Inc. (the Corporation or Hilltop) (OTCQB: HTBC), the holding company for Hilltop Community Bank (the Bank) today reported net income of $288,000 ($0.10 per common share, basic and diluted) for the quarter ended June 30, 2013. This was an increase of 32% when compared to net income of $219,000 ($0.08 per share, basic and diluted) for the second quarter of 2012.

Net income for the first half of 2013 was $471,000 ($0.16 per common share, basic and diluted) compared to net income of $454,000 ($0.16 per share, basic and diluted) for the first half of the prior year. Both the second quarter and first half results in 2013 were positively impacted by the sale of a bond in the Bank's investment portfolio that yielded a gain of $136,000.

Total assets amounted to $174.4 million at June 30, 2013, compared to total assets of $179.6 million at June 30, 2012, and total assets of $177.0 million at December 31, 2012. Gross loans were $106.0 million at June 30, 2013, down slightly from gross loan volume of $107.4 million at the mid point of last year. The allowance for loan losses was 1.73% of total loans at June 30, 2013. The net interest margin for the second quarter was 3.91%, a reduction of 19 basis points from the prior year's second quarter but generally higher than other New Jersey based community banks. The reduction in the margin was primarily caused by a lower yield on loans. Hilltop's net interest margin for the first six months of 2013 was 4.02%.

The proposed merger with Haven Bancorp, Inc., which was announced on June 5, 2013, is proceeding on schedule. Haven has submitted the required application to the regulators and Hilltop is working on the proxy statement which will be required as part of the shareholder approval process. A fourth quarter closing is anticipated. Under the proposed plan, shareholders of Hilltop Community Bancorp, Inc. will receive $9.42, in cash, for each share of the Corporation's stock that they own.

In a joint statement, Chairman of the Board Richard D. Wellbrock and President & CEO Mortimer J. O'Shea commented: "We are certainly pleased with our second quarter results. Hilltop continues to demonstrate a relatively low cost of funds that will help us stem the tide of lower rates on the asset side of the balance sheet. Our allowance for loan losses is very solid at 1.73% and we anticipate that we will be able to reduce our monthly provisioning for loan losses for the remainder of the year. It is gratifying that we have been able to negotiate a sale of the Corporation to Haven Bancorp, Inc. Most of our long time shareholders will realize a profit on their investment in Hilltop and our customers will become clients of a long established New Jersey financial institution."

Hilltop Community Bancorp, Inc. is the parent holding company for Hilltop Community bank. Hilltop Community Bank is a New Jersey state-chartered commercial bank which commenced operations in February 2000. The Bank operates as a locally headquartered, community bank engaged in a general commercial banking business. The Bank has offices in Summit, Berkeley Heights and Madison, and administrative offices in New Providence. The service area includes surrounding communities in Union, Essex, Morris and Somerset Counties.

The foregoing contains forward-looking statements within the meaning of the private Securities Litigation Reform Act of 1995. Such statements are not historical facts and include expressions about new and existing programs and products, relationships, opportunities, technology and market conditions. Such forward-looking statements involve certain risks and uncertainties . These include, but are not limited to, the direction of movement in interest rates, the possibility of disruption in credit markets, successful implementation and integration of acquisitions, the effects of economic conditions and the impact of legal barriers and structures. Actual results may differ from such forward-looking statements. The Corporation assumes no obligation for updating any such forward-looking statements at any time.

HILLTOP COMMUNITY BANCORP, INC.
Financial Information
June 30, 2013

Consolidated Balance Sheet
	06/30/13	06/30/12	12/31/12
Assets
Cash and due from banks	$ 2,679,200	$ 2,929,100	$ 2,437,600
Interest-bearing deposits in banks	20,661,600	22,986,500	20,277,400
Federal funds sold	100,000	995,000	100,000
Cash and cash equivalents	23,440,800	26,910,600	22,815,000
Investment securities	38,146,200	42,397,900	43,193,900
Loans receivable	106,023,300	107,407,900	108,305,400
Allowance for loan losses	(1,831,800)	(1,942,200)	(1,849,100)
Loans receivable, net	104,191,500	105,465,700	106,456,300
Bank premises and equipment, net	2,452,500	2,619,600	2,526,900
Intangible assets	372,900	372,900	372,900
Bank-owned life insurance	4,041,200	-	-
Other assets	1,793,700	1,876,800	1,632,300
Total assets	$174,438,800	$179,643,500	$176,997,300
Liabilities and Shareholders' Equity
Liabilities
Deposits:
Noninterest-bearing demand	$ 27,308,600	$ 29,880,000	$ 30,228,900
Interest-bearing demand	8,881,500	7,123,200	8,619,100
Money market and savings	80,039,200	80,115,600	77,206,700
Time deposits	31,721,200	37,195,100	34,286,900
Total deposits	147,950,500	154,313,900	150,341,600
Securities sold under agreements to repurchase	4,356,500	3,590,000	4,273,700
Other liabilities	1,379,000	1,196,200	1,471,700
Total liabilities	153,686,000	159,100,100	156,087,000
Shareholders' Equity
Common stock	19,051,100	19,051,100	19,051,100
Retained earnings	1,724,800	1,065,400	1,253,600
Treasury stock	(505,000)	(505,000)	(505,000)
Accumulated other comprehensive income	481,900	931,900	1,110,600
Total shareholders' equity	20,752,800	20,543,400	20,910,300
Total liabilities and shareholders' equity	$174,438,800	$179,643,500	$176,997,300

Consolidated Income Statement
	QTD		YTD
	06/30/13	06/30/12	06/30/13	06/30/12
Interest Income
Loans, including fees	$ 1,360,400	$ 1,479,500	$ 2,753,400	$ 3,006,400
Securities- taxable	125,800	215,200	266,200	438,600
Securities- tax-exempt	161,800	130,600	318,300	253,500
Other	13,800	16,200	24,700	28,200
Total interest income	1,661,800	1,841,500	3,362,600	3,726,700
Interest Expense
Deposits	134,500	204,500	264,900	413,600
Capital lease obligations and other borrowings	14,200	14,700	28,800	30,000
Total interest expense	148,700	219,200	293,700	443,600

Net interest income	1,513,100	1,622,300	3,068,900	3,283,100

Provision for Loan Losses	45,000	20,000	90,000	35,000
Net interest income after provision for
loan losses	1,468,100	1,602,300	2,978,900	3,248,100

Noninterest income
Gain on sale of investment security	135,800	-	135,800	-
OTTI charges, net	-	(23,500)	(11,900)	(65,400)
Service charges and fees	29,100	28,800	56,100	54,700
BOLI income	31,600	-	41,200	-
Other	38,800	54,100	71,600	116,100
Total noninterest income	235,300	59,400	292,800	105,400
Noninterest expense
Salaries and employee benefits	756,500	800,100	1,536,700	1,575,200
Occupancy and equipment	146,800	153,600	307,400	319,400
Data processing related operations	146,300	147,600	305,600	323,400
Advertising	10,300	29,200	28,100	58,300
Professional fees	50,700	43,700	96,200	91,900
FDIC insurance and assessments	26,800	20,600	51,100	43,300
Other operating	192,100	172,400	359,500	323,500
Total noninterest expense	1,329,500	1,367,200	2,684,600	2,735,000

Income before income tax expense	373,900	294,500	587,100	618,500
Income Tax Expense	85,500	75,100	115,900	164,500
Net income	$ 288,400	$ 219,400	$ 471,200	$ 454,000

Net Interest Margin (tax-equivalent basis)	3.91%	4.10%	4.02%	4.28%

Per Common Share Data:
Net income per common share- basic	$ 0.10	$ 0.08	$ 0.16	$ 0.16
Net income per common share- diluted	$ 0.10	$ 0.08	$ 0.16	$ 0.16
Tangible book value- period end			$ 6.97	$ 6.74

Return on Average Assets	0.66%	0.51%	0.55%	0.54%
Return on Average Equity	5.48%	4.29%	4.52%	4.47%

Asset Quality Data:
Accruing loans past due 30 to 89 days			$ 193,500	$ -
Accruing loans past due 90 days or more			$ -	$ -
Nonaccrual loans			$ 1,211,200	$ 1,085,200
Other real estate owned			$ -	$ -
Net charge-offs (recoveries)	$ (2,900)	$ 362,200	$ 92,400	$ 362,200

Miscellaneous:
Average assets	$174,622,300	$172,977,000	$171,962,400	$167,533,000
Average earning assets	$163,708,600	$165,914,000	$162,359,100	$160,549,400
Average deposits	$148,542,500	$147,581,100	$145,614,800	$141,845,600
Average shareholders' equity	$ 21,111,600	$ 20,500,200	$ 21,032,600	$ 20,405,400
Common shares outstanding- period end			2,856,399	2,856,399