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): August 17, 2009

CARVER BANCORP, INC.

(Exact name of registrant as specified in its charter)

DELAWARE	1-13007	13-3904174
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

75 West 125th Street New York, NY	10027-4512
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (212) 360-8820

(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:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

On August 17, 2009, Carver Bancorp, Inc. (the “Company”) issued a press release reporting financial results for the three months ending June 30, 2009, which is the first quarter of the Company’s fiscal year ending March 31, 2010. A copy of the press release is attached as Exhibit 99.1 to this report and incorporated herein by reference. The Company does not intend for this Item 2.02 or Exhibit 99.1 to be deemed “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934 or to be incorporated by reference into filings under the Securities Act of 1933.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

The following exhibit is filed as part of this report:

99.1   Press release entitled “CARVER BANCORP, INC. REPORTS FIRST QUARTER FISCAL YEAR 2010 EARNINGS”, dated August 17, 2009.

SIGNATURE

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 duly authorized.

DATE:  August 18, 2009

BY:	/s/ Mark A. Ricca
	Mark A. Ricca
	Executive Vice President, Chief Risk Officer and General Counsel

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EX-99.1

Exhibit 99.1

Contact:	David Lilly / Joseph Kuo	Mark Ricca
	Kekst and Company	Carver Bancorp, Inc.
	(212) 521-4800	(212) 360-8820

CARVER BANCORP, INC. REPORTS FIRST QUARTER FISCAL YEAR 2010 EARNINGS

Reports First Quarter Net Income of $0.7 million or Diluted Earnings per Share of $0.18
Board Declares Dividend of $0.10 per Share

New York, New York, August 17, 2009 – Carver Bancorp, Inc. (the “Company”) (NASDAQ: CARV), the holding company for Carver Federal Savings Bank (“Carver Federal” or the “Bank”), today announced financial results for the three month period ended June 30, 2009, the first quarter of the fiscal year ending March 31, 2010 (“fiscal 2010”).

The Company reported net income of $0.7 million and diluted earnings per share of $0.18 for the first quarter of fiscal 2010, compared to net income of $0.7 million and diluted earnings per share of $0.27 for the first quarter of fiscal 2009.  Net income for the first quarter of fiscal 2010 was negatively impacted by a $0.4 million FDIC special assessment as well as a $0.5 million increase in the provision for loan losses. The decline in earnings per share from the prior year period reflects the payment of $0.2 million in preferred dividends pursuant to Carver’s participation in the U.S. Treasury Department’s Troubled Asset Relief Program’s Capital Purchase Program (“TARP”).

Deborah C. Wright, the Company’s Chairman and Chief Executive Officer, stated: “I am pleased to report that the Company returned to profitable operations in the first quarter, despite economic headwinds that continue to impact our customers, and therefore our company. Carver’s strong net interest margin led the way, reaching 3.71%, up 18 basis points year over year, fueled by the steepness of the yield curve and our historically stable core deposit base. Total non-interest expense declined 3.7% year over year, reflecting our cost savings initiatives on a number of fronts, including compensation and benefits and other operating expenses. These savings were achieved despite the FDIC special assessment impacting our entire industry, reducing diluted earnings per share by $0.10 this quarter.

On the credit front, we continue to execute a very aggressive approach to address delinquent loans, which was successful in reducing non-performing loans from 3.42% of total assets at March 31, 2009 to 3.12% this quarter. However, total delinquencies continued to rise. We therefore increased the provision for loan losses by $0.7 million, or $0.18 per diluted share, generating a total allowance for loan losses of $7.4 million. The allowance now represents 1.12% of the total loan portfolio and 29.2% of non-performing assets.

We remain cautious, yet proactive, in managing credit in this unprecedented climate. While this remains a difficult period, making predictions of the future particularly challenging, Carver has a long history of low credit losses. This result follows, in part, from the nature of our loan portfolio. For example, the majority of Carver’s total delinquencies are in construction loans for affordable homes, an asset class that remains in high demand, and commercial mortgages. The housing developments are built by experienced builder-developers, whose apartment sales have been disrupted by dislocations in the secondary markets. While we work with our borrowers to identify mortgage options for their buyers, we note that the average loan-to-value on construction loans, when underwritten, was 45%. In addition, we have additional credit protection beyond the borrowers, and multiple ways to achieve payoff on these loans, including rental conversions and sale of the loans to the New York City Pension Fund.

As we address the risks inherent in the current economic climate, we continue to prepare to take advantage of business opportunities that are likely to occur during this period. When the economy emerges from the current financial crisis, we’ll be prepared to profitably provide the lending and deposit services that our customers need, thereby building the shareholder value to which we are all committed,” concluded Ms. Wright.

Carver also announced that on August 13, 2009, the Company’s Board of Directors declared a cash dividend on its common stock of ten cents $0.10 per common share for the first quarter. The dividend will be payable on September 14, 2009, to stockholders of record at the close of business on September 1, 2009.

First-Quarter Results

Net income for the first quarter of fiscal 2010 was $0.7 million, unchanged from the prior year period. Net interest income increased by $0.6 million to $6.9 million reflecting an 18 basis points increase in the net interest margin to 3.71%, compared to 3.53% in the prior year period. The increase in net interest income resulted from the significant reduction in interest rates during the year, attributable to the cost of interest-bearing liabilities declining faster than the yield on interest earning assets. Interest income decreased $1.2 million, or 10.8%, to $9.9 million, reflecting a decrease in yield on interest earning assets of 92 basis points to 5.34%, compared to the decrease in total interest expense of $1.8 million, reflecting a 117 basis points decrease in the average cost of interest-bearing liabilities to 1.82%.

The Bank provided a $0.7 million loan loss provision for the first quarter of fiscal 2010 compared to $0.2 million in the prior year period. At June 30, 2009, the Bank’s allowance for loan losses was $7.4 million, which represents 1.12% of total loans and 29.4% of non-performing loans. The Bank’s future level of non-performing loans will be influenced by economic conditions, including the impact of those conditions on the Bank’s customers, interest rates and other external factors existing at the time.

Non-interest income decreased $0.6 million, or 34.0%, to $1.2 million, primarily due to decreases of $0.2 million, in each of the following: loan fees and service charges, gain on sale of loans and other income.  The decrease in loan fees and gain on sales of loans reflects the decline in pre-payment fees during the quarter.  The $0.2 million decrease in other income reflects deconsolidation of a minority interest entity which was included in the first quarter prior year results.

Non-interest expense decreased $0.3 million, or 3.8%, to $7.1 million, primarily due to a decrease of $0.3 million in employee compensation and benefits and a $0.7 million decrease in other operating expenses offset by a $0.8 million increase in FDIC insurance premiums. The decrease in employee compensation and benefits is mainly related to reduced headcount. The decrease in other operating expenses is primarily related to progress made with respect to vendor management. Offsetting these significant reductions in expenses was higher FDIC insurance premiums compared to the prior year including a special assessment of $0.4 million.

Financial Condition Highlights

At June 30, 2009, total assets increased $18.2 million, or 2.3%, to $809.6 million from $791.4 million at March 31, 2009. The increase in total assets was primarily the result of an increase of $17.8 million in total gross loans receivable, an increase of $4.7 million in cash and cash equivalents, offset by a decrease of $5.6 million in investment securities. Total gross loans receivable, increased $17.8 million to $680.0 million compared to $662.2 million at March 31, 2009.  The increase was primarily related to increases in multi-family loans of $16.5 million, commercial business loans of $7.4 million, offset by decreases in construction loans of $5.7 million and one- to four- family loans of $2.1 million.  Total securities decreased $5.6 million, or 7.5%, to $69.2 million compared to $74.8 million at March 31, 2009. The decrease was primarily the result of principal repayments and maturities.

At June 30, 2009, total liabilities increased $18.2 million, or 2.5%, to $745.3 million compared to $727.1 million at March 31, 2009.  The increase in total liabilities was primarily the result of an increase of $16.1million, or 14.0%, in advances.  At June 30, 2009, based on available collateral held at the Federal Home Loan Bank of New York (“FHLB-NY”), the Bank had the ability to borrow an additional $29.7 million to meet its projected funding needs.

Total stockholders’ equity at June 30, 2009 totaled $64.4 million, unchanged compared to March 31, 2009. At June 30, 2009, the Bank’s capital levels met regulatory requirements of a well-capitalized financial institution.

Asset Quality 

At June 30, 2009, non-performing assets totaled $25.3 million, or 3.12% of total assets, compared to $27.1 million, or 3.42% of total assets at March 31, 2009. The ratio of the allowance for loan losses to non-performing loans was 29.4% at June 30, 2009 compared to 26.5% at March 31, 2009. The ratio of the allowance for loan losses to total loans was 1.12% at June 30, 2009 compared to 1.06% at March 31, 2009.

About Carver Bancorp, Inc.

Carver Bancorp, Inc. is the holding company for Carver Federal Savings Bank, a federally chartered stock savings bank.  Carver Federal Savings Bank, the largest African- and Caribbean-American run bank in the United States, operates nine full-service branches in the New York City boroughs of Brooklyn, Queens and Manhattan.  For further information, please visit the Company’s website at www.carverbank.com.

Certain statements in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from those included in these statements due to a variety of factors, risks and uncertainties.  More information about these factors, risks and uncertainties is contained in our filings with the Securities and Exchange Commission.

# # #

CARVER BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In thousands, except per share data)

	June 30,			March 31,
	2009			2009
	(unaudited)
ASSETS
Cash and cash equivalents:
Cash and due from banks	$	17,100		$	8,251
Money market investments		952			5,090
Total cash and cash equivalents		18,052			13,341
Securities:
Available-for-sale, at fair value (including pledged as collateral of $54,237 and $59,928 at June 30, 2009 and March 31, 2009, respectively)		54,685			59,973
Held-to-maturity, at amortized cost (including pledged as collateral of $14,087 and $14,342 at June 30, 2009 and March 31, 2009, respectively; fair value of $14,244 and $14,528 at June 30, 2009 and March 31, 2009, respectively)		14,474			14,808
Total securities		69,159			74,781
Loans held-for-sale		21,069			21,105
Loans receivable:
Real estate mortgage loans		592,611			581,987
Commercial business loans		64,789			57,398
Consumer loans		1,535			1,674
Allowance for loan losses		(7,369	)		(7,049	)
Total loans receivable, net		651,566			634,010
Office properties and equipment, net		14,888			15,237
Federal Home Loan Bank of New York stock, at cost		4,945			4,174
Bank owned life insurance		9,561			9,481
Accrued interest receivable		3,591			3,697
Core deposit intangibles, net		342			380
Other assets		16,465			15,222
Total assets	$	809,638		$	791,428
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Deposits	$	605,144		$	603,416
Advances from the FHLB-New York and other borrowed money		131,110			115,017
Other liabilities		9,005			8,657
Total liabilities		745,259			727,090
Stockholders’ equity:
Preferred stock (TARP) (par value $0.01 per share, 2,000,000 shares authorized; 18,980 shares, with a liquidation preference of $1,000.00 per share, issued and outstanding as of June 30, 2009)		18,980			18,980
Common stock (par value $0.01 per share: 10,000,000 shares authorized; 2,524,691 shares issued; 2,470,072 and 2,475,037 shares outstanding at June 30, 2009 and March 31, 2009, respectively)		25			25
Additional paid-in capital		24,219			24,214
Retained earnings		22,096			21,898
Unamortized awards of common stock under ESOP
Treasury stock, at cost (49,972 and 49,654 shares at June 30, 2009 and March 31, 2009, respectively		(696	)		(760	)
Accumulated other comprehensive loss		(245	)		(19	)
Total stockholders’ equity		64,379			64,338
Total liabilities and stockholders’ equity	$	809,638		$	791,428

CARVER BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)

	Three Months Ended
	June 30,
	2009			2008
Interest Income:
Loans	$	9,100		$	10,453
Mortgage-backed securities		743			561
Investment securities		60			66
Money market investments		10			39
Total interest income		9,913			11,119
Interest expense:
Deposits		2,037			4,139
Advances and other borrowed money		986			722
Total interest expense		3,023			4,861
Net interest income		6,890			6,258
Provision for loan losses		688			169
Net interest income after provision for loan losses		6,202			6,089
Non-interest income:
Depository fees and charges		717			668
Loan fees and service charges		228			417
Gain on loans		43			247
Other		165			416
Total non-interest income		1,153			1,748
Non-interest expense:
Employee compensation and benefits		3,119			3,414
Net occupancy expense		987			1,016
Equipment, net		584			615
Consulting fees		207			165
Federal deposit insurance premiums		793			31
Other		1,367			2,094
Total non-interest expense		7,057			7,335
Income before income taxes and minority interest		298			502
Income tax benefit		(396	)		(322	)
Minority interest, net of taxes		—			138
Net income	$	694		$	686
Earnings per common share:
Basic	$	0.18		$	0.28
Diluted	$	0.18		$	0.27

CARVER BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCES
(In thousands)
(Unaudited)

	For the Three Months Ended June 30,
	2009							2008
	Average				Average			Average				Average
	Balance		Interest		Yield/Cost			Balance		Interest		Yield/Cost
Interest Earning Assets:
Loans (1)	$	667,230	$	9,100		5.46	%	$	654,501	$	10,453		6.39	%
Mortgage-backed securities		70,159		743		4.24	%		43,454		561		5.16	%
Investment securities (2)		4,874		60		4.94	%		4,656		66		5.69	%
Other investments and federal funds sold		965		10		4.16	%		7,501		39		2.09	%
Total interest-earning assets		743,228		9,913		5.34	%		710,112		11,119		6.26	%
Non-interest-earning assets		52,737							78,692
Total assets	$	795,965						$	788,804
Interest Bearing Liabilities:
Deposits:
Now demand	$	54,172		23		0.17	%	$	24,231		20		0.33	%
Savings and clubs		119,239		66		0.22	%		125,496		166		0.53	%
Money market		43,674		147		1.35	%		46,229		296		2.57	%
Certificates of deposit		325,613		1,790		2.20	%		391,008		3,643		3.74	%
Mortgagors deposits		2,891		11		1.53	%		3,314		14		1.69	%
Total deposits		545,589		2,037		1.50	%		590,278		4,139		2.81	%
Borrowed money		120,276		986		3.29	%		62,267		722		4.65	%
Total interest-bearing liabilities		665,865		3,023		1.82	%		652,545		4,861		2.99	%
Non-interest-bearing liabilities:
Demand		58,406							53,658
Other liabilities		7,904							9,470
Total liabilities		732,175							715,673
Minority Interest		—							19,150
Stockholders’ equity		63,790							53,981
Total liabilities & stockholders’ equity	$	795,965						$	788,804
Net interest income			$	6,890						$	6,258
Average interest rate spread						3.52	%						3.28	%
Net interest margin						3.71	%						3.53	%

(1)	Includes non-accrual loans.
(2)	Includes FHLB-NY stock.

CARVER BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED SELECTED KEY RATIOS
(Unaudited)

	Three Months Ended
	June 30,
	2009			2008
Selected Statistical Data:
Return on average assets (1)		0.35	%		0.35	%
Return on average equity (2)		4.35			5.08
Net interest margin (3)		3.71			3.53
Interest rate spread (4)		3.52			3.28
Efficiency ratio (5)		87.74			91.62
Operating expenses to average assets (6)		3.55			3.72
Average equity to average assets (7)		8.01			6.84
Average interest-earning assets to average interest-bearing liabilities		1.12	x		1.09	x
Net income per share — basic	$	0.18		$	0.28
Net income per share — diluted	$	0.18		$	0.27
Average shares outstanding — basic		2,470,072			2,479,328
Average shares outstanding — diluted		2,470,072			2,517,058
Cash dividends	$	0.10		$	0.10
Dividend payout ratio (8)		35.59	%		36.07	%
Capital Ratios:
Tier I leverage capital ratio (9)		9.39	%		8.03	%
Tier I risk-based capital ratio (9)		11.40			9.86
Total risk-based capital ratio (9)		12.50			10.65

	At			At
	June 30,			March 31,
	2009			2009
Asset Quality Ratios:
Non performing assets to total assets (10)		3.12	%		3.42	%
Non performing loans to total loans receivable (10)		3.81			4.15
Allowance for loan losses to total loans receivable		1.12			1.06
Allowance for loan losses to non-performing loans		29.37			26.48

(1)	Net income, annualized, divided by average total assets.
(2)	Net income, annualized, divided by average total equity.
(3)	Net interest income, annualized, divided by average interest-earning assets.
(4)	Combined weighted average interest rate earned less combined weighted average interest rate cost.
(5)	Operating expenses divided by sum of net interest income plus non-interest income.
(6)	Non-interest expenses annualized, divided by average total assets.
(7)	Average equity divided by average assets for the period ended.
(8)	Dividends paid on common stock during the period divided by net income for the period.
(9)	These ratios reflect consolidated bank only.
(10)	Non performing assets consist of non-accrual loans, loans accruing 90 days or more past due and real estate owned.

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