EX-99.1 2 ex99-1.htm EX-99.1

EXHIBIT 99.1

 

 

  For Immediate Release
     
  Contact: Claire M. Chadwick
    SVP and Chief Financial Officer
    630 Godwin Avenue
    Midland Park, NJ 07432
    201- 444-7100

 

 

PRESS RELEASE

 

Stewardship Financial Corporation Announces

First Quarter of 2013 Earnings

 

Midland Park, NJ – May 9, 2013 – Stewardship Financial Corporation (NASDAQ:SSFN), parent of Atlantic Stewardship Bank, announced net income for the three months ended March 31, 2013 of $822,000 as compared to net income of $776,000 for the three months ended March 31, 2012. After dividends on preferred stock, the net income available to the common stockholders was $656,000, or $0.11 per diluted common share, for the current 2013 period compared to $701,000, or $0.12 per diluted common share, for the comparable period of 2012.

Net interest income was $5.9 million in the first quarter of 2013 compared to $6.1 million a year earlier. “In this prolonged, low interest rate environment, the Corporation continues to monitor and manage all expenses in order to alleviate some of the pressure on our asset yields,” said Paul Van Ostenbridge, Stewardship Financial Corporation’s President and Chief Executive Officer.

The Corporation recorded a $1.6 million provision for loan losses for the three months ended March 31, 2013 compared to a provision for loan losses of $1.8 million for the three months ended March 31, 2012. Van Ostenbridge commented, “The 2013 provision for loan

 
 

 

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losses, while lower than the prior year, remains elevated as a result of the continued challenging economic environment and its impact on our borrowers.”

Non-performing loans decreased to $17.5 million, or 3.97% of total loans at March 31, 2013, compared to $26.8 million, or 5.91% a year earlier and $18.2 million, or 4.14% at December 31, 2012. The ratio of allowance for loan losses to nonperforming loans increased to 65.67% at March 31, 2013, providing additional allowance coverage as compared to 48.83% at March 31, 2012 and 58.31% at December 31, 2012.

Addressing the Corporation’s problem assets, Van Ostenbridge stated, “Over the last year we have seen a significant decline in our level of nonperforming loans. While problem loans continue to migrate through the lengthy workout phase, including a very slow New Jersey foreclosure process, we are encouraged by the recent progress.”

The Corporation reported noninterest income of $1.5 million for the three months ended March 31, 2013 compared to $1.6 million for the equivalent prior year period. During the first quarter of 2013, noninterest income included $537,000 as a result of a death benefit insurance payment received. For the three months ended March 31, 2012 the Corporation realized a $433,000 gain from the sale of securities. Gain on sales of mortgage loans totaled $162,000 for the three months ended March 31, 2013, a decrease from $411,000 for the three months ended March 31, 2012, partially reflective of retaining a higher amount of mortgage loan originations for our portfolio.

Total noninterest expenses were $4.9 million for the three months ended March 31, 2013 – comparable to the prior year period.

Total assets at March 31, 2013 were $693.9 million, representing a slight increase from assets of $688.4 million at December 31, 2012. Additional liquidity was provided by increases in cash and cash equivalents. Gross loans receivable increased $1.1 million from December

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31, 2012, whereby new loans recorded were partially offset by payoffs and normal principal amortization.

Total deposits were $595.5 million at March 31, 2013, reflecting $5.3 million of deposit growth when compared to deposits of $590.3 million at December 31, 2012. The net growth in deposits during the first quarter of 2013 consisted of an $8.7 million increase in noninterest-bearing deposits and a $3.4 million decline in balances in interest-bearing accounts. At March 31, 2013 noninterest bearing deposits represented 22.3% of total deposits, up from 19.7% a year earlier.

Capital levels continue to significantly exceed the regulatory requirements for a “well capitalized” institution with a tier 1 leverage ratio of 9.27% and total risk based capital ratio of 15.08%.

Van Ostenbridge concluded, “While the substantial attention and resources devoted to addressing problem loans is showing results, we clearly recognize that there is more to accomplish. We are confident of our ability to implement appropriate loan work out strategies that improve asset quality and maximize loan repayments, supported by an appropriate level of loan loss reserves, coupled with a sound capital base.”

Stewardship Financial Corporation’s subsidiary, the Atlantic Stewardship Bank, has 13 banking offices in Midland Park, Hawthorne (2), Montville, North Haledon, Pequannock, Ridgewood, Waldwick, Wayne (3), Westwood and Wyckoff, New Jersey. The bank is known for tithing 10% of its pre-tax profits to Christian and local charities. To date, the Bank’s tithe donations total $7.7 million.

We invite you to visit our website at www.asbnow.com for additional information.

The information disclosed in this document contains certain “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, which forward looking statements may be identified by the use of such words as “believe,” “expect,” “anticipate,” “should,” “plan,” “estimate,” and “potential.” Examples of forward looking statements include,

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but are not limited to, estimates with respect to the financial condition, results of operations and business of the Corporation that are subject to various factors which could cause actual results to differ materially from these estimates. These factors include: changes in general, economic and market conditions, legislative and regulatory conditions, or the development of an interest rate environment that adversely affects the Corporation’s interest rate spread or other income anticipated from operations and investments.

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Stewardship Financial Corporation

Selected Consolidated Financial Information

(dollars in thousands, except per share amounts)

(unaudited)

 

   March 31,   December 31,   March 31, 
   2013   2012   2012 
             
Selected Financial Condition Data:               
     Cash and cash equivalents  $26,144   $21,016   $24,181 
     Securities available for sale   175,493    174,700    175,102 
     Securities held to maturity   28,548    29,718    36,353 
     FHLB Stock   2,213    2,213    2,266 
     Loans receivable:               
          Loans receivable, gross   441,533    440,423    453,671 
          Allowance for loan losses   (11,512)   (10,641)   (13,097)
          Other, net   62    50    62 
     Loans receivable, net   430,083    429,832    440,636 
                
     Loans held for sale   2,101    784    1,395 
     Other assets   29,344    30,125    32,112 
     Total assets  $693,926   $688,388   $712,045 
                
                
     Noninterest-bearing deposits  $132,960   $124,286   $118,597 
     Interest-bearing deposits   462,578    465,968    483,486 
     Total deposits   595,538    590,254    602,083 
     Other borrowings   25,000    25,000    28,000 
     Securities sold under agreements to repurchase   7,344    7,343    14,342 
     Subordinated debentures   7,217    7,217    7,217 
     Other liabilities   2,152    2,228    2,348 
     Stockholders' equity   56,675    56,346    58,055 
     Total liabilities and stockholders' equity  $693,926   $688,388   $712,045 
                
     Equity to assets   8.17%    8.19%    8.15% 
                
Asset Quality Data:               
     Nonaccrual loans  $17,479   $18,011   $26,823 
     Loans past due 90 days or more and accruing   50    237    — 
     Total nonperforming loans   17,529    18,248    26,823 
     Other real estate owned   876    1,058    3,840 
     Total nonperforming assets  $18,405   $19,306   $30,663 
                
                
     Nonperforming loans to total loans   3.97%    4.14%    5.91% 
     Nonperforming assets to total assets   2.65%    2.80%    4.31% 
     Allowance for loan losses to nonperforming loans   65.67%    58.31%    48.83% 
     Allowance for loan losses to total gross loans   2.61%    2.42%    2.89% 

 

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Stewardship Financial Corporation

Selected Consolidated Financial Information

(dollars in thousands, except per share amounts)

(unaudited)

 

   For the three months ended 
   March 31, 
   2013   2012 
Selected Operating Data:          
Interest income  $6,870   $7,516 
Interest expense   1,004    1,465 
Net interest and dividend income   5,866    6,051 
Provision for loan losses   1,600    1,765 
Net interest and dividend income          
after provision for loan losses   4,266    4,286 
Noninterest income:          
Fees and service charges   456    515 
Bank owned life insurance   76    80 
Gain on calls and sales of securities   2    433 
Gain on sales of mortgage loans   162    411 
Gain on sales of other real estate owned   126    99 
Gain on life insurance proceeds   537    — 
Other   115    111 
Total noninterest income   1,474    1,649 
Noninterest expenses:          
Salaries and employee benefits   2,696    2,386 
Occupancy, net   517    487 
Equipment   184    248 
Data processing   328    334 
FDIC insurance premium   150    148 
Other   1,057    1,250 
Total noninterest expenses   4,932    4,853 
Income before income tax expense (benefit)   808    1,082 
Income tax expense (benefit)   (14)   306 
Net income   822    776 
Dividends on preferred stock   166    75 
Net income available to common stockholders  $656   $701 
           
Weighted avg. no. of diluted common shares   5,930,981    5,892,366 
Diluted earnings per common share  $0.11   $0.12 
           
Return on average common equity   6.39%    6.47% 
           
Return on average assets   0.49%    0.44% 
           
Yield on average interest-earning assets   4.39%    4.59% 
Cost of average interest-bearing liabilities   0.82%    1.11% 
Net interest rate spread   3.57%    3.48% 
           
Net interest margin   3.76%    3.71% 

 

 

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