VERNON, N.J.--(BUSINESS WIRE)--Highlands Bancorp, Inc. (OTCPink: HSBK), parent company of Highlands State Bank, announced first quarter net income of $500,000, an increase of 29.5% when compared to net income of $386,000 for the same period in 2016. Net income before taxes for the first quarter of 2017 increased $177,000 to $789,000 compared to $612,000 for the first quarter of 2016. First quarter 2017 net income available to common stockholders was $500,000 or $.19 per basic and $.18 per diluted share, compared to $369,000 or $.21 per basic and $.20 per diluted share for the same period in 2016.
Net interest income increased by $305,000 to $3,096,000 for the first quarter of 2017, as compared to net interest income of $2,791,000 for the first quarter of 2016, which is attributed to higher average loan balances. The net interest rate spread declined to 2.91% for the first quarter of 2017, as compared to 3.39% for the first quarter of 2016. Net interest margin also decreased to 3.18% for the first three months 2017 as compared to 3.67% for the same period of 2016. The current year net interest spread and net interest margin decreases reflect an overall decline in loan interest rates due to the continued low rate environment, and higher rates paid by the Company on deposit promotions. The provision for loan losses increased by $113,000 to $279,000 for the first quarter of 2017 when compared to $166,000 for the same period of 2016 due primarily to loan portfolio growth. Charge-offs for the first quarter of 2017 were $10,000 compared to $282,000 in the first quarter of 2016. There were no recoveries of previously charged off loans for the first quarter of 2017 or 2016. Non-interest income decreased $176,000 to $792,000 for the first three months of 2017 from $968,000 for the comparable 2016 period due lower gains on sales of loans by the Company’s mortgage subsidiary. Non-interest expenses decreased by $161,000 to $2,820,000 for the first quarter of 2017 compared to $2,981,000 for the same period of 2016 due to lower salaries and commissions, occupancy, and insurance costs, which were partially offset by increased loan expenses.
The Company’s total assets were $407.6 million on March 31, 2017, an increase of $12.6 million or 3.2% when compared to total assets of $395.0 million at December 31, 2016. Deposits increased $15.4 million or 4.5% from $342.8 million on December 31, 2016 to $358.2 million on March 31, 2017. Net loans outstanding on March 31, 2017 were $355.5 million compared to $331.6 million on December 31, 2016, an increase of $23.9 million or 7.2%. Non-accrual loans increased $45 thousand to $2.2 million at March 31, 2017 when compared to December 31, 2016, but declined to .62% of total loans for March 31, 2017 from .65% of total loans at December 31, 2016.
The Company serves as the holding company for Highlands State Bank. Highlands State Bank is a full service community bank headquartered in Vernon, New Jersey with branch offices in Sparta, Totowa, and Denville, New Jersey. Highlands State Bank provides deposit and loan banking services to consumers and businesses in northern New Jersey. Secure Lending Solutions, Inc., a wholly owned subsidiary of Highlands State Bank, specializes in conventional 1-4 family mortgage loans.
This news release contains certain forward-looking statements, either expressed or implied, which are provided to assist the reader in understanding anticipated future financial performance. These statements involve certain risks, uncertainties, estimates and assumptions made by management, which are subject to factors beyond the company’s control and could impede its ability to achieve these goals. These factors include general economic conditions, trends in interest rates, the ability of our borrowers to repay their loans, and results of regulatory exams, among other factors.
|Highlands Bancorp, Inc.|
|(Dollars in thousands, except per share data)|
|Three Months Ended|
|Net interest income||$||3,096||$||2,791|
|Provision for loan losses||279||166|
|Net income before income tax||789||612|
|Income tax expense||(289||)||(226||)|
|Preferred stock dividends and accretion||-||(17||)|
Net income available to common stockholders
|EARNINGS PER COMMON SHARE:|
|Net income available to|
|Weighted average common shares|
|SELECTED BALANCE SHEET DATA|
|AT END OF PERIOD||3/31/2017||12/31/2016|
|Allowance for loan losses||3,836||3,567|
|Loans held for sale||1,565||5,009|
|Intangible Assets Other Than Goodwill||175||175|
|Book value per common share||$||10.07||$||9.89|
|Tangible book value per common share||$||9.58||$||9.40|
Loans past due 90 days and still accruing
Troubled debt restructurings (TDRs) currently in compliance with new terms
|Allowance for loan losses to total loans||1.07||%||1.06||%|
Non-performing loans and performing TDRs to total loans