8-K

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): July 21, 2009

ECB BANCORP, INC.

(Exact name of registrant as specified in its charter)

North Carolina	000-24753	56-2090738
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

Post Office Box 337 Engelhard, North Carolina	27824
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (252) 925-9411

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:

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

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

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

¨ 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 July 21, 2009, we announced our results of operations for the three and six months ended June 30, 2009. A copy of our press release is being furnished as Exhibit 99.1 to this Report.

Item 9.01. Financial Statements and Exhibits.

(c) Exhibits. The following exhibit is furnished with this Report:

Exhibit No.	Exhibit Description
99.1	Copy of our press release dated July 21, 2009

Disclosures About Forward Looking Statements

Statements in this Report and its exhibits relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments, expectations or beliefs about future events or results, and other statements that are not descriptions of historical facts, may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, risk factors discussed in our Annual Report on Form 10-K and in other documents we file with the Securities and Exchange Commission from time to time. Copies of those reports are available through our Internet website at www.ecbbancorp.com or directly through the Commission’s website at www.sec.gov. Forward-looking statements may be identified by terms such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “forecasts”, “potential” or “continue”, or similar terms or the negative of these terms, or other statements concerning opinions or judgments of our management about future events. Factors that could influence the accuracy of such forward-looking statements include, but are not limited to, (a) the financial success or changing strategies of our customers; (b) actions of government regulators, or changes in laws, regulations or accounting standards, that adversely affect our business; (c) changes in the interest rate environment and the level of market interest rates that reduce our net interest margins and/or the volumes and values of loans we make and securities we hold; (d) changes in competitive pressures among depository and other financial institutions or in our ability to compete effectively against other financial institutions in our banking market; (e) changes in general economic and business conditions and changes in real estate values in our banking market (particularly changes that affect our loan portfolio, the abilities of our borrowers to repay their loans, and the values of loan collateral); (f) weather and similar conditions, particularly the effect of hurricanes on our banking and operations facilities and on our customers and the communities in which we do business; and (g) other developments or changes in our business that we do not expect. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. All forward-looking statements attributable to us are expressly qualified in their entirety by the cautionary statements in this paragraph.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, we have duly caused this Report to be signed on our behalf by the undersigned thereunto duly authorized.

	ECB BANCORP, INC.
	(Registrant)
Date: July 21, 2009	By:	/s/ Gary M. Adams
		Gary M. Adams
		Chief Financial Officer

EX-99.1

Exhibit 99.1

PRESS RELEASE

July 21, 2009

CONTACT:	ECB Bancorp, Inc.
	Gary M. Adams, Chief Financial Officer
	(252) 925-5525
	(252) 925-8491 facsimile

FOR IMMEDIATE RELEASE

ECB Bancorp, Inc. Reports 2009 Second Quarter Financial Results

ENGELHARD, N.C.-ECB Bancorp, Inc. (NASDAQ:ECBE) (“ECB” or the “Company”) today announced its results for the three and six months ended June 30, 2009.

2009 Second Quarter Financial Highlights

For the three months ended June 30, 2009, net income was $800,000, which compares to net income for the three months ended June 30, 2008 of $1,102,000. After adjusting for $268,000 in preferred stock dividends and accretion of warrant discount, net income available to common shareholders for the three months ended June 30, 2009 was $532,000 or $0.19 per diluted share compared to $0.38 per diluted share for the three months ended June 30, 2008.

For the six months ended June 30, 2009, net income was $2,053,000, which compares to net income for the six months ended June 30, 2008 of $2,148,000. After adjusting for $475,000 in preferred stock dividends and accretion of warrant discount, net income available to common shareholders for the six months ended June 30, 2009 was $1,578,000 or $0.55 per diluted share compared to $0.74 per diluted share for the prior year period.

Other Financial Highlights include:

• Consolidated assets increased 18.9% to $877,465,000 at June 30, 2009 from $738,040,000 at June 30, 2008.

• Loans increased 9.7% to $566,601,000 at June 30, 2009 from $516,492,000 at June 30, 2008.

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• Deposits increased 21.6% to $703,467,000 at June 30, 2009 from $578,273,000 at June 30, 2008.

• Net interest income increased 24.2% to $6,642,000 for the three months ended June 30, 2009 from $5,347,000 for the same three month period a year ago. For the six months ended June 30, 2009, net interest income increased 22.7% to $12,654,000 compared to $10,317,000 for the first six months of 2008.

• Non-interest income for the three months ended June 30, 2009 was $1,792,000, an increase of 3.8% compared to $1,727,000 for the same three month period a year ago. For the six months ended June 30, 2009, non-interest income increased 0.8% to $3,755,000 compared to $3,725,000 for the same period in 2008.

• Declared quarterly common stock dividend of $0.1825 per share, or $0.73 per share on an annualized basis, representing an identical dividend for 2009 as declared in 2008.

Arthur H. Keeney III, President and CEO (who retired July 1, 2009) stated: “While we made significant progress in some areas (net interest income, net interest margin and expense control), we continued to adopt a conservative posture regarding our provision for possible loan losses by significantly increasing it during the second quarter. The result is that allowance for loan losses (“AFLL”) to period end loans stands at 1.02% at June 30 versus 0.88% at March 31, 2009. We took this action as we watched our non-performing loans to period end loans tick up to 1.83% at June 30, 2009 from 1.43% at March 31, 2009 (as compared to 1.85% at 12/31/08). However, we also watched our net charge-offs to average loans (annualized) decrease during the second quarter to 0.74% as compared to 1.37% during the first quarter of 2009. Management continues to expect losses on these well collateralized, non-performing loans to be minimal and below peer average. Consequently, we feel well positioned for what now appears most likely to be the continuation of our nation’s distressed economic condition into 2010.

“While we enjoyed a healthy increase (in excess of 24%) in our net interest income during the second quarter of 2009 as well as a 25 BP jump in our net interest margin to 3.37% at June 30, 2009 over the 3.12% level at March 31, 2009 (2.70% at December 31, 2008), this was not enough to overcome the impact of the increase in our provision expense and FDIC insurance premiums, and the FDIC special assessment, which occurred during the first six months of 2009. FDIC insurance expense was $910,000 for the six months ended June 30, 2009 versus $167,000 for the similar period in 2008, a variance of $743,000. This expense alone caused our total non-interest expenses to increase 5.8% for the six month period ending June 30, 2009 over the six month period ending June 30, 2008.

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“We continue to be pleased with the overall credit quality of our loan portfolio and its growth through June 30, 2009. We have been able to add several quality business relationships even though market and economic conditions remained in a weakened condition. Our strong capital position, enhanced by our liquidity enabled this to happen. We are in the business to lend money and we will continue to do so to credit worthy businesses and individuals.”

After nearly 14 years as President/CEO of the organization (and 40 years in the banking industry) Arthur H. Keeney III retired effective July 1, 2009. Succeeding Mr. Keeney as President/CEO is Mr. A. Dwight Utz who comes to the Company from MidSouth Bank in Lafayette, Louisiana. Mr. Utz served at that organization since 2001 as its Executive Vice President/Chief Retail Officer. Mr. Utz also serves as a director of the Company, and Mr. Keeney will continue to serve as a director.

About ECB Bancorp, Inc.

ECB Bancorp, Inc. is a bank holding company, headquartered in Engelhard, North Carolina, whose wholly-owned subsidiary, The East Carolina Bank, is a state-chartered, independent community bank insured by the FDIC. The Bank provides a full range of financial services through its 24 offices covering eastern North Carolina from Currituck to Ocean Isle Beach and Greenville to Hatteras. The Bank also provides mortgages, insurance services through the Bank’s licensed agents, and investment and brokerage services offered through a third-party broker-dealer. The Company’s common stock is listed on The Nasdaq Global Market under the symbol “ECBE”. More information can be obtained by visiting ECB’s web site at www.ecbbancorp.com.

“Safe Harbor Statement” Under the Private Securities Litigation Reform Act of 1995

Statements in this Press Release relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments, expectations or beliefs about future events or results, and other statements that are not descriptions of historical facts, may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, risk factors discussed in the Company’s Annual Report on Form 10-K and in other documents filed by the Company with the Securities and Exchange Commission from time to time. Forward-looking statements may be identified by terms such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “forecasts”, “potential” or “continue,” or similar terms or the negative of these terms, or other statements concerning opinions or judgments of the

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Company’s management about future events. Factors that could influence the accuracy of such forward-looking statements include, but are not limited to pressures on the earnings, capital and liquidity of financial institutions in general, resulting from current and future conditions in the credit and equity markets, the financial success or changing strategies of the Company’s customers, actions of government regulators, the level of market interest rates, weather and similar conditions, particularly the effect of hurricanes on the Company’s banking and operations facilities and on the Company’s customers and the communities in which it does business, changes in general economic conditions and the real estate values in our banking market (particularly changes that affect our loan portfolio, the abilities of our borrowers to repay their loans, and the values of loan collateral). Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievements. All forward-looking statements attributable to the Company are expressly qualified in their entirety by the cautionary statements in this paragraph. The Company has no obligations, and does not intend to update these forward-looking statements.

###

See 3 pages of financial information attached

ECB BANCORP, INC. AND SUBSIDIARY

Consolidated Balance Sheets

June 30, 2009, December 31, 2008 and June 30, 2008

(Dollars in thousands, except per share data)

	June 30, 2009			December 31, 2008*			June 30, 2008
	(unaudited)						(unaudited)
Assets
Non-interest bearing deposits and cash	$	13,688		$	15,897		$	15,629
Interest bearing deposits		895			902			1,318
Overnight investments		10,645			—			—
Total cash and cash equivalents		25,228			16,799			16,947
Investment securities
Available-for-sale, at market value (cost of $231,683, $237,638 and $161,522 at June 30, 2009, December 31, 2008 and June 30, 2008, respectively)		232,521			239,709			157,589
Loans		566,601			538,836			516,492
Allowance for loan losses		(5,787	)		(5,931	)		(4,739	)
Loans, net		560,814			532,905			511,753
Real estate and repossessions acquired in settlement of loans, net		7,200			3,724			603
Federal Home Loan Bank common stock, at cost		5,116			3,859			4,309
Bank premises and equipment, net		25,340			25,737			25,143
Accrued interest receivable		4,577			4,663			4,464
Bank owned life insurance		8,511			8,347			8,195
Other assets		8,158			6,108			9,037
Total	$	877,465		$	841,851		$	738,040
Liabilities and Shareholders’ Equity
Deposits
Demand, noninterest bearing	$	96,023		$	90,197		$	106,601
Demand, interest bearing		115,738			99,011			97,542
Savings		18,341			16,882			17,796
Time		473,365			423,062			356,334
Total deposits		703,467			629,152			578,273
Payable, settlement for securities purchased		—			53,426			—
Accrued interest payable		1,646			2,889			3,089
Short-term borrowings		60,191			57,716			60,928
Long-term obligations		21,000			26,000			26,000
Other liabilities		5,369			4,725			4,944
Total liabilities		791,673			773,908			673,234
Shareholders’ equity
Preferred stock, Series A		17,041			—			—
Common stock, par value $3.50 per share		9,956			9,956			10,111
Capital surplus		25,746			25,707			26,332
Warrant		878			—			—
Retained earnings		31,676			31,026			30,801
Accumulated other comprehensive income (loss)		495			1,254			(2,438	)
Total shareholders’ equity		85,792			67,943			64,806
Total	$	877,465		$	841,851		$	738,040
Common shares outstanding		2,844,489			2,844,489			2,888,896
Common shares authorized		10,000,000			10,000,000			10,000,000
Preferred shares outstanding		17,949			—			—
Preferred shares authorized		2,000,000			—			—

* Derived from audited consolidated financial statements.

ECB BANCORP, INC. AND SUBSIDIARY

Consolidated Income Statements

For three and six months ended June 30, 2009 and 2008

(Dollars in thousands, except per share data)

	Three months ended June 30,				Six months ended June 30,
	2009		2008		2009		2008
	(unaudited)		(unaudited)		(unaudited)		(unaudited)
Interest income:
Interest and fees on loans	$	7,666	$	7,805	$	15,013	$	15,762
Interest on investment securities:
Interest exempt from federal income taxes		332		326		651		660
Taxable interest income		2,307		1,565		4,837		2,824
Dividend income				87		30		151
Other interest income		—		45		3		115
Total interest income		10,305		9,828		20,534		19,512
Interest expense:
Deposits:
Demand accounts		199		185		385		481
Savings		11		22		22		45
Time		3,173		3,668		6,768		7,571
Short-term borrowings		112		406		308		849
Long-term obligations		168		200		367		249
Other interest expense		—		—		30		—
Total interest expense		3,663		4,481		7,880		9,195
Net interest income		6,642		5,347		12,654		10,317
Provision for loan losses		2,000		570		2,750		900
Net interest income after provision for loan losses		4,642		4,777		9,904		9,417
Noninterest income:
Service charges on deposit accounts		916		859		1,792		1,705
Other service charges and fees		350		405		617		674
Mortgage origination brokerage fees		236		330		527		637
Net gain on sale of securities		183		19		588		94
Income from bank owned life insurance		82		76		164		165
Other operating income		25		38		67		450
Total noninterest income		1,792		1,727		3,755		3,725
Noninterest expenses:
Salaries		2,005		1,983		4,074		4,019
Retirement and other employee benefits		702		847		1,453		1,679
Occupancy		449		459		929		911
Equipment		431		414		819		836
Professional fees		102		86		399		296
Supplies		55		73		111		155
Telephone		138		161		290		338
FDIC deposit insurance		655		91		910		167
Other operating expenses		947		994		1,971		1,964
Total noninterest expenses		5,484		5,108		10,956		10,365
Income before income taxes		950		1,396		2,703		2,777
Income taxes		150		294		650		629
Net Income		800		1,102		2,053		2,148
Preferred stock dividends		224		—		406		—
Accretion of discounts		44		—		69		—
Income available to common stockholders	$	532	$	1,102	$	1,578	$	2,148
Net income per share – basic	$	0.19	$	0.38	$	0.55	$	0.74
Net income per share – diluted	$	0.19	$	0.38	$	0.55	$	0.74
Weighted average shares outstanding – basic		2,844,489		2,891,931		2,843,260		2,901,775
Weighted average shares outstanding – diluted		2,846,359		2,897,399		2,844,904		2,906,954

ECB Bancorp, Inc. Supplemental Quarterly Financial Data (unaudited)

(Dollars in thousands, except per share data)

	06/30/2009			03/31/2009			12/31/2008			09/30/2008			06/30/2008
Income Statement Data:
Interest income	$	10,305		$	10,229		$	9,712		$	9,874		$	9,828
Interest expense		3,663			4,217			5,056			4,574			4,481
Net interest income		6,642			6,012			4,656			5,300			5,347
Provision for loan losses		2,000			750			1,110			440			570
Net after provision expense		4,642			5,262			3,546			4,860			4,777
Noninterest income		1,792			1,963			1,219			1,865			1,727
Noninterest expense		5,484			5,472			4,792			5,476			5,108
Income (loss) before income taxes		950			1,753			(27	)		1,249			1,396
Income taxes		150			500			(289	)		240			294
Net Income		800			1,253			262			1,009			1,102
Preferred stock dividend & accretion of discount		268			207			—			—			—
Net Income available to common shareholders	$	532		$	1,046		$	262		$	1,009		$	1,102
Per Share Data and Shares Outstanding:
Net income – basic	$	0.19		$	0.37		$	0.09		$	0.35		$	0.38
Net income – diluted		0.19			0.37			0.09			0.35			0.38
Cash dividends		0.1825			0.1825			0.1825			0.1825			0.1825
Book value at period end		24.17			24.58			23.89			22.88			22.43
Dividend payout ratio		96.05	%		49.32	%		202.78	%		52.14	%		48.03	%
Weighted-average number of common shares outstanding:
Basic		2,844,489			2,842,017			2,851,292			2,883,121			2,891,931
Diluted		2,846,359			2,843,398			2,857,712			2,888,466			2,897,399
Shares outstanding at period end		2,844,489			2,844,489			2,844,489			2,887,996			2,888,896
Balance Sheet Data:
Total assets	$	877,465		$	865,383		$	841,851		$	767,768		$	738,040
Loans —gross		566,601			550,639			538,836			524,337			516,492
Allowance for loan losses		5,787			4,828			5,931			5,077			4,739
Investment securities		232,521			247,663			239,709			154,077			157,589
Interest earning assets		815,778			806,045			783,306			704,524			679,708
Premises and equipment, net		25,340			25,482			25,737			25,250			25,143
Total deposits		703,467			688,082			629,152			619,019			578,273
Short-term borrowings		60,191			62,161			57,716			45,674			60,928
Long-term obligations		21,000			21,000			26,000			26,000			26,000
Shareholders’ equity		85,792			86,925			67,943			66,086			64,806
Selected Performance Ratios (annualized):
Return on average assets		0.37	%		0.58	%		0.14	%		0.54	%		0.61	%
Return on average shareholders’ equity		3.64	%		5.98	%		1.59	%		6.23	%		6.52	%
Net interest margin		3.37	%		3.12	%		2.70	%		3.14	%		3.33	%
Efficiency ratio		63.08	%		66.52	%		80.93	%		73.81	%		69.73	%
Asset Quality Ratios:
Nonperforming loans to period-end loans		1.83	%		1.43	%		1.85	%		2.27	%		0.12	%
Allowance for loan losses to period-end loans		1.02	%		0.88	%		1.10	%		0.97	%		0.92	%
Allowance for loan losses to nonperforming loans		56	%		61	%		59	%		43	%		752	%
Net charge-offs to average loans (annualized)		0.74	%		1.37	%		0.19	%		0.08	%		0.17	%
Capital Ratios:
Equity-to-assets ratio		9.78	%		10.04	%		8.07	%		8.61	%		8.78	%
Leverage Capital Ratio		9.76	%		9.87	%		8.65	%		9.00	%		9.28	%
Tier 1 Capital Ratio		13.20	%		13.54	%		10.83	%		11.31	%		11.52	%
Total Capital Ratio		14.09	%		14.31	%		11.80	%		12.16	%		12.33	%

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