VERNON, N.J.--(BUSINESS WIRE)--Highlands Bancorp, Inc. (OTCPink:HSBK) parent company of Highlands State Bank, reported second quarter 2018 net income of $912,000 compared to net income of $717,000 for the second quarter of 2017, increasing $195,000 or 27.2%. Second quarter 2018 net income available to common stockholders totaled $911,000 or $.34 per basic and $.32 per diluted common share, an increase of 27.2% compared to $716,000 or $.26 per basic and diluted common share for the same period in 2017. For the six months ended June 30, 2018 net income increased $524,000 or 43.1% to $1,741,000 compared to net income of $1,217,000 for the same period in 2017. Net income available to common stockholders for the six months of 2018 totaled $1,740,000 or $.64 per basic common share and $.62 per diluted common share compared to $1,216,000 or $.45 per basic and $.44 per diluted common share for 2017.
Net interest income increased by $409,000 to $3,669,000 for the second quarter of 2018 when compared to net interest income of $3,260,000 for the second quarter of 2017 due to growth in the loan and investment portfolios during the period. For the first six months of 2018, net interest income was $7,189,000 compared to $6,356,000 for the same period of 2017, reflecting an increase of $833,000 or 13.1%. The provision for loan losses for the second quarter of 2018 of $221,000 increased by $10,000 when compared to $211,000 for the second quarter of 2017, and decreased $171,000 to $319,000 for the first six months of 2018 when compared to $490,000 for the same period in 2017. The lower provision for loan losses in 2018 is a result of management’s continued assessment of the reserves maintained on non-performing loans. There were no loan charge-offs for the second quarter of 2018 or 2017, and no charge-offs for the six months ended June 30, 2018, compared to loan charge-offs of $10,000 for the same period in 2017. There were no recoveries of previously charged off loans during the second quarters of 2018 or 2017. Recoveries for the first six months of 2018 and 2017 totaled $0 and $1,000 respectively.
Non-interest income for the second quarter of 2018 increased $14,000 when compared to the same period in 2017 due to higher loan and late fees, and increased debit card interchange income. Non-interest income for the first six months of 2018 increased $86,000 when compared to the same period in 2017 due to higher loan fees and insufficient fund charges. Non-interest expenses increased by $354,000 to $3,082,000 for the second quarter of 2018, and by $731,000 to $6,279,000 for the six months ended June 30, 2018 when compared to similar periods of 2017 due to the additional costs associated with the Company’s growth and increased earnings, including higher salary and benefit costs from additions made to staff, and increased data processing, deposit insurance, foreclosed asset, advertising, legal, and professional costs.
The Company’s total assets were $487.9 million on June 30, 2018, increasing $38.9 million or 8.7% when compared to total assets of $449.0 million at December 31, 2017. Deposits increased $12.8 million or 3.3% from $389.1 million on December 31, 2017 to $401.9 million on June 30, 2018. Borrowings increased $23.3 million or 82.3% to $51.6 million from $28.3 million on December 31, 2017 to fund loan growth and provide additional liquidity. Net loans outstanding on June 30, 2018 were $422.7 million compared to $396.6 million on December 31, 2017, reflecting an increase of $26.1 million or 6.6%. Non-accrual loans decreased $414 thousand to $2.7 million at June 30, 2018 compared to $3.1 million at December 31, 2017, and non-performing loans and performing troubled debt restructurings as a percentage of total loans declined to .79% at June 30, 2018 from .96% at December 31, 2017.
The Company serves as the holding company for Highlands State Bank. Highlands State Bank is a full service community bank headquartered in Vernon, New Jersey with branch offices in Sparta, Totowa, and Denville New Jersey. Highlands State Bank provides deposit and loan banking services to consumers and businesses in northern New Jersey.
This news release contains certain forward-looking statements, either expressed or implied, which are provided to assist the reader in understanding anticipated future financial performance. These statements involve certain risks, uncertainties, estimates and assumptions made by management, which are subject to factors beyond the company’s control and could impede its ability to achieve these goals. These factors include general economic conditions, trends in interest rates, the ability of our borrowers to repay their loans, and results of regulatory exams, among other factors.
|Highlands Bancorp, Inc.|
|(Dollars in thousands, except per share data)|
|Three Months Ended||Six Months Ended|
|June 30,||June 30,|
|Net interest income||$||3,669||$||3,260||$||7,189||$||6,356|
|Provision for loan losses||221||211||319||490|
|Net income before income tax||1,191||1,132||2,280||1,921|
|Income tax expense||(279||)||(415||)||(539||)||(704||)|
|Net income attributable to|
|Net income available to|
|EARNINGS PER COMMON SHARE:|
|Net income available to|
|Weighted average common shares|
|SELECTED BALANCE SHEET DATA|
|AT END OF PERIOD||6/30/2018||12/31/2017|
|Allowance for loan losses||4,596||4,276|
|Loans held for sale||6,273||5,194|
|Book value per common share||$||11.15||$||10.55|
|Tangible book value per common share||$||10.72||$||10.13|
|Loans past due 90 days and|
|Troubled debt restructurings (TDRs)|
|currently in compliance with new terms||691||749|
|Allowance for loan losses to total loans||1.08||%||1.07||%|
|Non-performing loans and performing TDRs|
|to total loans||0.79||%||0.96||%|