Community National Bank Announces Earnings for Fourth Quarter and Year-End Results for 2014

MELVILLE, N.Y.--()--Community National Bank (OTC: CBNY) today announced fourth quarter and year-end results for 2014. Highlights for the quarter and year include:

  • Net income of $0.9 million or $0.13 diluted earnings per share for the fourth quarter of 2014 compared to net income of $0.9 million or $0.14 diluted earnings per share for the same period in 2013. Net income for the 2014 fourth quarter included $0.3 million or $0.04 per share of merger related charges, net of tax, associated with the acquisition of Community National Bank in an all-stock merger by Bridge Bancorp. Inc., the parent company of Bridgehampton National Bank, which was announced on December 15, 2014.
  • Net interest income increased 12% or $0.8 million to $7.8 million for the quarter ended December 31, 2014 compared to $7.0 million for the quarter ended December 31, 2013.
  • Loans grew $99.1 million or 15% to $760.5 million at December 31, 2014 when compared to December 31, 2013. On a linked-quarter basis, loans increased $10.7 million or 1.4% compared to $749.8 million at September 30, 2014.
  • Deposits increased $141.8 million or 21% to $828.8 million at December 31, 2014 compared to $687.0 million at December 31, 2013.
  • Demand deposits grew $53.5 million or 30% to $230.6 million at December 31, 2014 compared to $177.1 million at December 31, 2013.
  • The Bank capital ratios remained strong with Tier 1 leverage, Tier 1 risk-based and total risk-based capital ratios of 8.63%, 11.48% and 12.74%, respectively, at December 31, 2014.

Net Income

Net income for the quarter ended December 31, 2014 was $0.9 million or $0.13 diluted earnings per share compared to net income of $0.9 million or $0.14 diluted earnings per share for the same period in 2013. Net income was flat when compared to the prior year as higher net interest income from loan growth was offset by additional loan loss provisions and merger related charges.

Net income for the year ended December 31, 2014 was $4.3 million or $0.63 diluted earnings per share compared to net income of $2.9 million or $0.44 diluted earnings per share for the year ended December 31, 2013, an increase of 46%. Net income for the year increased due to significant growth in net interest income from loan growth and additional service charge income, which were partially offset by higher personnel costs for lending, operations and compliance as well as the full year impact of facility related expenses.

Net Interest Income

For the quarter ended December 31, 2014, net interest income increased $0.8 million or 12% to $7.8 million compared to $7.0 million for the quarter ended December 31, 2013. The net interest margin decreased by 10 basis points to 3.53% for the quarter ended December 31, 2014 from 3.63% for the quarter ended December 31, 2013.

For the year ended December 31, 2014, net interest income increased $4.2 million or 16% to $30.7 million compared to $26.5 million for the year ended December 31, 2013. The net interest margin decreased by 12 basis points to 3.62% for the year ended December 31, 2014 from 3.74% for the year ended December 31, 2013.

The decline in the net interest margin for both the quarter and the year was primarily due to new loan originations carrying lower yields and existing loans re-pricing to lower rates.

Non-Interest Income

Non-interest income remained flat at $0.6 million for the quarter ended December 31, 2014 compared to $0.6 million for the prior year period.

Non-interest income increased $0.2 million or 5.3% to $3.8 million for the year ended December 31, 2014 compared to $3.6 million for the year ended December 31, 2013. The increase was due to higher service charge fee income and servicing and other income, which were partially offset by lower gains from the sale of SBA loans and lower BOLI income.

Non-Interest Expense

Non-interest expense increased $0.6 million or 10% to $6.3 million for the quarter ended December 31, 2014 compared to $5.7 million for the same period in 2013. Non-interest expense increased $3.1 million or 14% to $24.5 million for the year ended December 31, 2014 compared to $21.4 million for the year ended December 31, 2013.

The increase for both the quarter and year reflects the impact of a full year of expenses related to two new facilities and the employment of additional personnel in lending, credit administration, compliance and operations to support the growth in assets. The increase also included $0.5 million in merger related charges incurred during the fourth quarter.

Balance Sheet

Total assets grew to $950.7 million at December 31, 2014, an increase of $132.1 million or 16% when compared to total assets of $818.6 million at December 31, 2013. The commercial loan portfolio increased $70.8 million or 15% when compared to December 31, 2013 and the residential loan portfolio increased $28.3 million or 14% when compared to December 31, 2013. Loans were funded primarily by the growth in deposits.

Total deposits increased $141.8 million or 21% to $828.8 million at December 31, 2014 from $687.0 million at December 31, 2013. Demand deposits grew $53.5 million or 30% to $230.6 million at December 31, 2014 when compared to December 31, 2013. The increase was due primarily to additional commercial business relationships. Demand deposits represented 28% of total deposits at December 31, 2014. NOW, savings and money market deposits increased $47.5 million or 15% to $364.3 million at December 31, 2014 from $316.8 million at December 31, 2013. A significant portion of the money market deposit growth was from new and existing municipal banking relationships.

Asset Quality & Capital

Non-performing loans, which consist of loans past due 90 days or more, were $7.0 million or 0.92% of total loans at December 31, 2014 compared to $1.2 million or 0.18% of total loans at December 31, 2013. The increase was mostly attributable to two loans totaling approximately $5.4 million being placed on non-accrual basis. The Bank recorded $0.6 million in provision for loan losses during the fourth quarter of 2014 compared to $0.3 million for the fourth quarter of 2013.

The allowance for loan losses was $11.0 million or 1.45% of total loans at December 31, 2014, an increase of $1.6 million from $9.4 million or 1.42% of total loans at December 31, 2013. The Bank had net charge-offs of $0.2 million during the fourth quarter of 2014 and $1.0 million for the year ended December 31, 2014.

The Bank did not own any foreclosed properties at December 31, 2014 and December 31, 2013, respectively.

Further information about the financial condition and performance of Community National Bank is available from its Call Reports filed with the FDIC and available on the FDIC website at: http://www.fdic.gov/. The Bank expects to file its December 31, 2014 Call Report on or around January 30, 2015.

ABOUT COMMUNITY NATIONAL BANK

Community National Bank is a Long Island based independent commercial bank and operates eleven locations in Nassau, Suffolk, Queens and Manhattan Counties. We offer a full range of modern financial services, backed by state-of-the-art technology. In addition to commercial loans, commercial mortgages, small business loans and lines of credit and residential mortgages, CNB also provides a complete selection of traditional personal and commercial deposit products such as no fee individual and business checking accounts, IRA accounts and statement savings.

Cautionary Statement about Forward-Looking Statements

This release contains certain “forward looking statements” about CNB which, to the extent applicable, are intended to be covered by the safe harbor for forward looking statements provided under the Federal securities laws and, regardless of such coverage, you are cautioned about. Examples of forward-looking statements include but are not limited to, CNB’s financial condition, capital ratios, results of operations and outlook. Forward-looking statements are not historical facts. Such statements may be identified by the use of such words as “may,” “believe,” “expect,” “anticipate,” “plan,” “continue,” or similar terminology. These statements relate to future events or our future financial performance and involve risks and uncertainties that may cause our actual results, levels of activity, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we caution you not to place undue reliance on these forward-looking statements. Factors which may cause our forward looking statements to be materially inaccurate include, but are not limited to, a unexpected deterioration in our loan portfolio, unexpected increases in our expenses, greater than anticipated growth, unanticipated regulatory action, unexpected changes in interest rates, a loss of key personnel, an unanticipated loss of existing customers, competition from other institutions causing us unanticipated changes in our deposit or loan rates, increases in FDIC insurance costs and unanticipated adverse changes in our customers’ economic conditions or economic conditions in our local area generally. Forward-looking statements speak only as of the date of this press release We do not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

 

COMMUNITY NATIONAL BANK

STATEMENTS OF INCOME
Unaudited

 
For The Three Months Ended     For The Twelve Months Ended
December 31,     December 31,     December 31,     December 31,
2014     2013     2014     2013
Interest Income:
Commercial Loans $6,495,663 $5,672,443 $25,107,979 $21,151,026
Residential and Consumer Loans 1,916,549 1,738,300 7,367,590 6,752,885
Securities 626,761 609,843 2,496,564 2,285,048
Money Market Investments 25,643     20,428     44,932     53,846
Total Interest Income 9,064,616     8,041,014     35,017,065     30,242,805
 
Interest Expense:
NOW, Savings & Money Market 329,672 328,531 1,233,441 930,361
Certificates of Deposit 772,105 608,736 2,742,561 2,370,573
Borrowed Funds 90,166     75,860     372,969     482,056
Total Interest Expense 1,191,943     1,013,127     4,348,971     3,782,990
Net Interest Income 7,872,673 7,027,887 30,668,094 26,459,815
Provision For Loan Losses 610,000     373,000     2,690,000     4,003,000
Net Interest Income After Provision for Loan Losses 7,262,673     6,654,887     27,978,094     22,456,815
 
Non-Interest Income:
Service Charges 375,092 331,778 1,424,042 1,147,897
Servicing & Other Income 119,963 167,308 575,945 540,435
Gain on Sale of Investments 43,760 - 64,192 29,439
Gain on Sale of Loans 6,459 26,237 1,205,677 1,342,162
BOLI Income 139,515     151,206     589,777     605,703
Total Non-Interest Income 684,789     676,529     3,859,633     3,665,636
 
Non-Interest Expense:
Compensation and Benefits 3,205,963 2,836,429 12,562,411 10,688,891
Occupancy and Equipment 1,509,916 1,388,281 5,986,739 5,381,344
Advertising 4,148 49,321 102,015 223,032
Other Expenses 1,653,325     1,499,655     5,868,234     5,134,232
Total Non-Interest Expense 6,373,352     5,773,686     24,519,399     21,427,499
Income Before Income Taxes 1,574,110 1,557,730 7,318,328 4,694,952
Provision For Income Taxes 693,980     596,387     3,010,971     1,743,303
Net Income $880,130     $961,343     $4,307,357     $2,951,649
 
Earnings Per Share:
Basic $0.13 $0.14 $0.64 $0.44
Diluted $0.13 $0.14 $0.63 $0.44
Weighted Average Shares Outstanding – Basic 6,706,051 6,673,181 6,681,466 6,673,181
Weighted Average Shares Outstanding – Diluted 6,862,322 6,796,064 6,855,335 6,774,277

 

 

 

COMMUNITY NATIONAL BANK

STATEMENTS OF INCOME
Unaudited

 
    For the Three Months Ended
December 31,     September 30,     June 30,     December, 31
2014     2014     2014     2013
Interest Income:
Commercial Loans $6,495,663 $6,492,204 $5,930,011 $5,672,443
Residential and Consumer Loans 1,916,549 1,896,659 1,810,821 1,738,300
Securities 626,761 597,278 640,178 609,843
Money Market Investments 25,643     11,645     3,577     20,428
Total Interest Income 9,064,616     8,997,786     8,384,587     $8,041,014
 
Interest Expense:
NOW, Savings & Money Market 329,672 324,750 283,207 328,531
Certificates of Deposit 772,105 771,647 633,285 608,736
Borrowed Funds 90,166     93,868     102,541     75,860
Total Interest Expense 1,191,943     1,190,265     1,019,033     1,013,127
Net Interest Income 7,872,673 7,807,521 7,365,554 7,027,887
Provision For Loan Losses 610,000     565,000     540,000     373,000
Net Interest Income After Provision for Loan Losses 7,262,673     7,242,521     6,825,554     6,654,887
 
Non-Interest Income:
Service Charges 375,092 368,935 355,939 331,778
Servicing & Other Income 119,963 176,788 177,818 167,308
Gain on Sale of Investments 43,760 - - -
Gain on Sale of Loans 6,459 405,169 121,024 26,237
BOLI Income 139,515     160,015     148,321     151,206
Total Non-Interest Income 684,789     1,110,907     803,102     676,529
 
Non-Interest Expense:
Compensation and Benefits 3,205,963 3,142,732 3,071,264 2,836,429
Occupancy and Equipment 1,509,916 1,500,284 1,455,135 1,388,281
Advertising 4,148 1,855 44,969 49,321
Other Expenses 1,653,325     1,438,479     1,395,784     1,499,655
Total Non-Interest Expense 6,373,352     6,083,350     5,967,152     5,773,686
Income Before Income Taxes 1,574,110 2,270,078 1,661,504 1,557,730
Provision For Income Taxes 693,980     967,990     641,000     596,387
Net Income $880,130     $1,302,088     $1,020,504     $961,343
 
Earnings Per Share:
Basic $0.13 $0.20 $0.15 $0.14
Diluted $0.13 $0.19 $0.15 $0.14
Weighted Average Shares Outstanding – Basic 6,706,051 6,673,181 6,673,181 6,673,181
Weighted Average Shares Outstanding – Diluted 6,862,322 6,836,003 6,845,990 6,796,064

 

 

 

 

 

 

COMMUNITY NATIONAL BANK

STATEMENTS OF CONDITION
Unaudited

                       
December 31,     September 30,     June 30,     December, 31
2014     2014     2014     2013
Assets:
Cash and Due From Banks $15,092,542 $14,206,744 $12,876,224 $8,783,780
Money Market Investments 45,121,637 41,449,611 28,984,287 2,102,723
 
Securities – Available-for-Sale 84,288,861 93,370,412 96,991,395 100,894,759
Securities – Held-to-Maturity 8,229,963 8,605,371 8,989,549 6,053,339
Restricted Stock 4,580,100     4,605,100     4,924,950     5,408,850
Total Securities 97,098,924     106,580,883     110,905,894     112,356,948
 
 
Commercial Loans 534,876,102 529,813,930 509,189,897 464,037,616
Residential & Consumer Loans 225,637,144     220,032,946     214,296,552     197,350,345
Gross Loans Held-For-Investment 760,513,246 749,846,876 723,486,449 661,387,961
Less: Allowance For Loans Losses (11,008,163)     (10,629,364)     (10,897,125)     (9,383,788)
Net Loans Held-For-Investment 749,505,083 739,217,512 712,589,324 652,004,173
 
Premises and Equipment, net 10,007,801 10,298,002 10,529,647 11,116,968
Bank Owned Life Insurance (“BOLI”) 22,689,337 22,549,822 22,389,807 20,099,560
Other Assets 11,156,072     10,713,315     10,588,820     12,118,062
Total Assets $950,671,396     $945,015,889     $908,864,003     $818,582,214
 
Liabilities and Stockholders' Equity:
Deposits:
Demand $230,608,244 $224,352,849 $220,648,870 $177,107,547
NOW, Savings & Money Market 364,278,786 359,236,060 331,320,846 316,807,903
Certificates of Deposit 233,914,633     242,588,408     238,321,973     193,134,562
Total Deposits 828,801,663     826,177,317     790,291,689     687,050,012
 
FHLB Advances 35,891,243 36,448,268 37,178,305 54,921,135
Accrued Expenses and Other Liabilities 5,913,512     5,857,278     6,148,817     4,985,420
Total Liabilities 870,606,418     868,482,863     833,618,811     746,956,567
 
Stockholders’ Equity:
Common Stock, par value $5.00; authorized
10,000,000 shares; issued 6,673,181 shares 34,310,905 33,365,905 33,365,905 33,365,905
Additional Paid in Capital 35,581,203 34,566,573 34,496,707 34,362,152
Retained Earnings 10,714,298 9,834,168 8,532,080 6,406,941
Unrealized Loss on Securities (541,428)     (1,233,620)     (1,149,500)     (2,509,351)
Total Stockholders' Equity 80,064,978     76,533,026     75,245,192     71,625,647
Total Liabilities and Stockholders' Equity $950,671,396     $945,015,889     $908,864,003     $818,582,214
COMMUNITY NATIONAL BANK
SELECTED FINANCIAL DATA & BALANCE SHEET COMPONENTS
Unaudited
 
               
For The Three Months Ended     For The Twelve Months Ended
December 31, December 31, December 31, December 31,
2014     2013     2014     2013
Per Share:
Net Income-Basic $0.13 $0.14 $0.64 $0.44
Average Shares Outstanding – Basic 6,706,051 6,673,181 6,681,466 6,673,181
Net Income – Diluted $0.13 $0.14 $0.63 $0.44
Average Shares Outstanding – Diluted 6,862,322 6,796,064 6,855,335 6,774,277
Tangible Book Value $11.67 $10.73 $11.67 $10.73
 
Performance:
Return on Average Assets 0.38% 0.47% 0.49% 0.40%
Return on Average Equity 4.53% 5.35% 5.73% 4.09%
Efficiency Ratio 74.48% 74.94% 71.01% 71.13%
 
Yield on Average Earning Assets 4.06% 4.16% 4.14% 4.28%
Cost on Average Interest Bearing Liabilities 0.76% 0.74% 0.73% 0.76%
Cost of Deposits 0.54% 0.53% 0.52% 0.53%
Net Interest Spread 3.30% 3.42% 3.41% 3.51%
Net Interest Margin 3.53% 3.63% 3.62% 3.74%

 

                 
Quarter Ended
December 31, September 30, June 30, December 31,
2014     2014     2014     2013
Capital Ratios:
Tangible Common Equity 8.42% 8.10% 8.28% 8.75%
Leverage 8.63% 8.42% 8.94% 9.12%
Tier 1 11.48% 11.15% 11.42% 11.91%
Total Risk Based 12.74% 12.40% 12.68% 13.16%
 
Asset Quality:
Allowance for Loan Losses to Total Loans 1.45% 1.42% 1.51% 1.42%
Allowance for Loan Losses to Non-Performing Loans 157% 541% 402% 800%
Non-Performing Loans to Total Loans 0.92% 0.26% 0.37% 0.18%
Non-Performing Assets to Total Assets 0.74% 0.21% 0.30% 0.14%
Annualized Quarterly Net Charge offs to Avg. Loans 0.12% 0.45% 0.00% -0.04%
 
Yield on Average Earning Assets 4.06% 4.08% 4.10% 4.16%
Cost on Average Interest Bearing Liabilities 0.76% 0.76% 0.71% 0.74%
Cost of Deposits 0.54% 0.55% 0.51% 0.53%
Net Interest Spread 3.30% 3.32% 3.39% 3.42%
Net Interest Margin 3.53% 3.54% 3.60% 3.63%

Contacts

For Community National Bank
Jay McConie, 516-498-9111 Ext. 1139
Senior Vice President
Chief Financial Officer

Release Summary

Community National Bank announces earnings for Q4 2014 and year-end 2014

Contacts

For Community National Bank
Jay McConie, 516-498-9111 Ext. 1139
Senior Vice President
Chief Financial Officer