DUNN, N.C., July 31 /PRNewswire-FirstCall/ -- New Century Bancorp (the "Company") , the holding company for New Century Bank, reported a net loss for the quarter ended June 30, 2009, of ($253,000) compared to net income of $404,000 for the same period in 2008. Basic and diluted earnings (loss) per share were ($0.04) for second quarter 2009 compared to $0.06 for second quarter 2008.
Earnings for the quarter were adversely impacted by an increase in the provision for loan losses resulting from an increase in nonaccrual loans and the impairment reserves related to those loans. During the second quarter, nonperforming loans increased to $13.4 million, largely due to five loan relationships, each over $500,000 and totaling $4.7 million, that were reclassified from past due to nonaccrual. Excluding nonaccruals, total past due loans improved on a linked quarter basis from 0.98% at March 31, 2009 to 0.51% at June 30, 2009.
The Company was further affected by two unusual items: a special insurance premium assessment from the Federal Deposit Insurance Corporation (FDIC) and a one-time write-off of $51,000 on the loss in value of stock in the parent company of Silverton Bank, Atlanta, GA. In June 2009, the FDIC required a special insurance assessment from all FDIC-insured banks. For New Century Bank, this resulted in a special assessment of $285,766, bringing year-to-date total insurance premiums paid for 2009 to $639,144 compared to total FDIC insurance premiums for the same period in 2008 of $224,499, an increase of $414,645 or 185%. Excluding the special assessment, non-interest expenses were lower in both the three and six month periods ending June 30, 2009, compared to the same periods one year earlier.
For the first six months of 2009, net income for New Century Bancorp was $155,000 compared to net income for the first six months of 2008 of $314,000. At this time, the Company's annual goodwill impairment evaluation process is underway. Pending the results of this evaluation, second quarter results as reported could be adversely impacted.
As of June 30, 2009, the Company reported total assets of $629.0 million, total deposits of $527.6 million and total loans of $467.9 million. As of June 30, 2008, these figures stood at total assets of $598.8 million, total deposits of $505.4 million, and total loans of $452.0 million, for increases of 5.04%, 4.39%, and 3.50%, respectively, in a year-to-year comparison. At December 31, 2008, total assets were $605.8 million, total deposits were $505.1 million and total loans were $460.6 million, meaning New Century experienced increases for the first six months of 2009 of 3.83%, 4.45%, and 1.57%, respectively.
"Although loan demand softened in the past quarter, overall we are satisfied with loan growth year-to-date," said William L. Hedgepeth II, president and CEO of New Century Bancorp and New Century Bank. "While the Company had a net loss for the quarter, year-to-date we were able to report positive net income and in light of continuing difficult economic conditions, we are pleased with this result. We use a disciplined approach to creating strong customer relationships and to lowering controllable operating expenses and this should give us a strong foundation for positive growth and profitability in the future.
"The housing and real estate markets continue to be impacted by a weak economy and to present challenges regarding property values and credit quality. This is reflected in the increase in our loan loss provision and loan charge-offs during the first six months of 2009. We continue to focus on monitoring and improving the quality of our loan portfolio.
"New Century is well-capitalized, which is the highest regulatory standard. Because of our capital position, the Company made the decision not to participate in the U.S. Government's TARP (Troubled Asset Relief Program) Capital Purchase Plan, as has already been reported. We are committed to maintaining a sound capital position and ample liquidity, meeting the borrowing needs of the markets we serve, and positioning the Company for future growth.
"During the quarter, we celebrated the 9th anniversary of the opening of New Century Bank on May 24, 2000. We appreciate the support of our board of directors, our shareholders, our customers, and the communities we serve. To all of you, and to our employees, especially all of you who have been with us from the very beginning--thank you."
New Century Bank is headquartered in Dunn and has offices in Dunn, Clinton (2), Fayetteville (2), Goldsboro, Lillington, Lumberton, Pembroke, and Raeford.
Keywords: New Century Bancorp, New Century Bank, NCBC
The information as of and for the quarter ended June 30, 2009, as presented is unaudited. This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, (i) statements regarding certain of our goals and expectations with respect to earnings, earnings per share, revenue, expenses and the growth rate in such items, as well as other measures of economic performance, including statements relating to estimates of credit quality trends, and (ii) statements preceded by, followed by or that include the words "may," "could," "should," "would," "believe," "anticipate," "estimate," "expect," "intend," "plan," "projects," "outlook" or similar expressions. The actual results might differ materially from those projected in the forward-looking statements for various reasons, including, but not limited to, our ability to manage growth, our limited operating history, substantial changes in financial markets, regulatory changes, changes in interest rates, loss of deposits and loan demand to other savings and financial institutions, and changes in real estate values and the real estate market. Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the Company's SEC filings, including its periodic reports under the Securities Exchange Act of 1934, as amended, copies of which are available upon request from the Company.
http://www.newcenturybanknc.com/ New Century Bancorp, Inc. Selected Financial Information and Other Data ($ in thousands, except per share data) At or for the three months ended -------------------------------- June 30, March 31, December 31, September 30, June 30, 2009 2009 2008 2008 2008 ------- --------- ------------ ------------- -------- Summary of Operations: Total interest income $8,009 $8,252 $8,348 $8,678 $8,827 Total interest expense 3,459 3,673 3,991 4,043 4,299 ----- ----- ----- ----- ----- Net interest income 4,550 4,579 4,357 4,635 4,528 Provision for loan losses 1,414 685 2,142 895 374 ----- --- ----- --- --- Net interest income after provision 3,136 3,894 2,215 3,740 4,154 Noninterest income 792 845 790 620 749 Noninterest expense 4,428 4,080 4,158 4,108 4,292 ----- ----- ----- ----- ----- Income (loss) Before income taxes (500) 659 (1,153) 252 611 Provision for income taxes (benefit) (247) 251 (487) 93 207 ---- --- ---- -- --- Net income (loss) $(253) $408 $(666) $159 $404 ===== ==== ===== ==== ==== Share and Per Share Data: Earnings (loss) per share -basic $(0.04) $0.06 $(0.10) $0.02 $0.06 Earnings (loss) per share - diluted (0.04) 0.06 (0.10) 0.02 0.06 Book value per share 9.21 9.23 9.17 9.03 8.97 Tangible book value per share 7.80 7.82 7.76 7.61 7.54 Ending shares outstanding 6,836,149 6,831,149 6,831,149 6,827,649 6,822,659 Weighted average shares outstanding: Basic 6,831,973 6,831,149 6,829,731 6,826,481 6,816,966 Diluted 6,831,973 6,835,476 6,829,731 6,879,919 6,860,016 Selected Performance Ratios: Return on average assets -0.16% 0.27% -0.43% 0.11% 0.27% Return on average equity -1.60% 2.61% -4.27% 1.02% 2.60% Net interest margin 3.16% 3.26% 3.07% 3.34% 3.29% Efficiency ratio (1) 82.89% 75.22% 80.78% 78.17% 81.33% Period End Balance Sheet Data: Loans, net of unearned income $467,872 $469,794 $460,626 $457,784 $452,045 Total Earning Assets 573,951 584,030 560,534 547,965 550,984 Goodwill and other intangible assets 9,603 9,642 9,680 9,719 9,757 Total Assets 629,000 628,748 605,767 596,457 598,831 Deposits 527,621 523,537 505,119 501,823 505,400 Short term debt 23,461 27,408 23,175 17,896 17,441 Long term debt 12,372 12,372 12,372 12,372 12,372 Shareholders' equity 62,947 63,059 62,659 61,653 61,201 Selected Average Balances: Gross Loans $469,581 $468,062 $458,100 $456,120 $449,254 Total Earning Assets 577,774 570,221 562,415 551,353 552,581 Goodwill and other intangible assets 9,622 9,660 9,699 9,738 9,776 Total Assets 630,180 616,026 607,685 595,049 597,193 Deposits 526,894 513,079 508,911 500,914 502,742 Short term debt 24,606 24,458 21,659 17,077 17,243 Long term debt 12,372 12,372 12,372 12,372 12,372 Shareholders' equity 63,615 63,421 61,868 62,017 62,275 Asset Quality Ratios: Nonperforming loans $13,352 $7,739 $8,630 $9,148 $8,443 Other real estate owned 2,196 2,333 2,799 677 439 Allowance for loan losses 8,519 7,792 8,860 7,140 6,483 Nonperforming loans (2) to period-end loans 2.85% 1.65% 1.87% 2.00% 1.87% Allowance for loan losses to period- end loans 1.82% 1.66% 1.92% 1.56% 1.43% Delinquency Ratio (3) 0.51% 0.98% 0.32% 0.34% 0.92% Net loan charge-offs to average loans 0.59% 1.52% 0.39% 0.21% 2.71% ---- ---- ---- ---- ---- At or for the six months ended ------------------------------ June 30, 2009 June 30, 2008 June 30, 2007 ------------- ------------- ------------- Summary of Operations: Total interest income $16,261 $18,208 $20,658 Total interest expense 7,132 9,339 10,035 ----- ----- ------ Net interest income 9,129 8,869 10,623 Provision for loan losses 2,100 1,247 3,044 ----- ----- ----- Net interest income after provision 7,029 7,622 7,579 Noninterest income 1,637 1,593 2,088 Noninterest expense 8,507 8,746 8,029 ----- ----- ----- Income (loss) before income taxes 159 469 1,638 Provision for income taxes (benefit) 4 155 566 --- --- --- Net income (loss) $155 $314 $1,072 ==== ==== ====== Share and Per Share Data: Earnings (loss) per share - basic $0.02 $0.05 $0.16 Earnings (loss) per share - diluted 0.02 0.05 0.16 Book value per share 9.21 8.97 8.95 Tangible book value per share 7.80 7.54 7.44 Ending shares outstanding 6,836,149 6,822,659 6,550,272 Weighted average shares outstanding: Basic 6,831,563 6,806,731 6,520,663 Diluted 6,842,137 6,870,808 6,771,458 Selected Performance Ratios: Return on average assets 0.05% 0.11% 0.38% Return on average equity 0.49% 1.01% 3.65% Net interest margin 3.21% 3.22% 4.03% Efficiency ratio (1) 79.02% 83.60% 63.17% Period End Balance Sheet Data: Loans, net of unearned income $467,872 $452,045 $455,939 Total Earning Assets 573,951 550,984 545,952 Goodwill and other intangible assets 9,603 9,757 9,911 Total Assets 629,000 598,831 590,486 Deposits 527,621 505,400 502,258 Short term debt 23,461 17,441 15,119 Long term debt 12,372 12,372 12,372 Shareholders' equity 62,947 61,201 58,649 Selected Average Balances: Gross Loans $468,825 $445,945 $446,422 Total Earning Assets 574,018 552,689 531,969 Goodwill and other intangible assets 9,641 9,795 9,949 Total Assets 623,143 598,442 575,624 Deposits 520,025 503,456 484,091 Short term debt 24,533 17,853 17,342 Long term debt 12,372 12,372 12,372 Shareholders' equity 63,518 62,273 59,297 Asset Quality Ratios: Nonperforming loans $13,352 $8,443 $3,292 Other real estate owned 2,196 439 326 Allowance for loan losses 8,519 6,483 6,682 Nonperforming loans (2) to period-end loans 2.85% 1.87% 0.72% Allowance for loan losses to period-end loans 1.82% 1.43% 1.47% Delinquency Ratio (3) 0.51% 0.92% 1.02% Net loan charge-offs to average loans 1.05% 1.38% 1.74% ---- ---- ---- (1) Efficiency ratio is calculated as non-interest expenses divided by the sum of net interest income and non-interest income. (2) Nonperforming loans consist of non-accrual loans and restructured loans. (3) Delinquency Ratio includes 30-89 days past due and excludes non- accrual loans.
New Century Bancorp
CONTACT: Lisa F. Campbell, Executive Vice President, Chief Operating
Officer and Chief Financial Officer of New Century Bancorp, +1-910-892-7080,
lisac@newcenturybanknc.com
Web Site: http://www.newcenturybanknc.com/
