DUNN, N.C., Oct. 30 /PRNewswire-FirstCall/ -- New Century Bancorp (the "Company" Nasdaq: NCBC), the holding company for New Century Bank, reported a net loss for the quarter ended September 30, 2009, of ($369,000) compared to net income of $159,000 for the same period in 2008. Basic and diluted net income (loss) per share was ($0.05) for third quarter 2009 compared to $0.02 for third quarter 2008.
For the nine month period ended the same date, the Company reported a net loss of ($214,000) compared to net income of $473,000 for the same period in 2008. Basic and diluted net income (loss) per share was ($0.03) for the first nine months of 2009 compared to $0.07 for the first nine months of 2008.
As New Century Bank, along with all banks nationwide, deals with the nearly unprecedented fallout from the recession, quarterly earnings continue to be adversely impacted by increases in the provision for loan losses resulting from nonperforming loans. The third quarter increase in the Company's nonperforming loans resulted principally from one $3.0 million relationship that was downgraded from past due to nonaccrual status. In response to this increase in our nonperforming loans, during the quarter we recorded a provision for loan losses of $2.4 million.
Net interest income increased in a year-to-year comparison from $4.6 million for the three months ended September 30, 2008, to nearly $5.1 million for the same period in 2009.
"While our quarterly and year-to-date results are not what we want them to be," said William L. Hedgepeth III, president and CEO of New Century Bancorp and New Century Bank, "there are a number of positive indicators we are pleased with at this time. Perhaps most importantly, net interest margin improved from 3.34% for the third quarter last year to 3.52% for the three months ended September 30, 2009. Net interest income is a key driver of a bank's financial performance so this positive trend from 2008 to 2009 is, we hope, an indication that things are moving in a positive direction. Our staff has worked hard to improve our margin and we are now seeing the results of their efforts.
"Hand-in-hand with this, we are closely managing noninterest expenses. We have accomplished this with a keen focus on reducing and eliminating expenses wherever we can without impacting service to our customers or hampering our ability to grow the bank. Due to these efforts, our efficiency ratio was 69.5% for the three months ended September 30, 2009, compared to 78.7% for the same period in 2008."
Impacting income for the first nine months of 2009, were two previously reported unusual items: a special insurance premium assessment of $286,000 from the Federal Deposit Insurance Corporation (FDIC) (the assessment was levied against all banks), and a one-time permanent impairment charge of $51,000 from our investment in the stock of the parent company of Silverton Bank, Atlanta, GA.
As of September 30, 2009, the Company reported total assets of $636.8 million, total deposits of $533.4 million and total loans of $472.6 million. As of September 30, 2008, these figures stood at total assets of $596.5 million, total deposits of $501.8 million, and total loans of $457.8 million, representing increases of 6.8%, 6.3%, and 3.2%, respectively, in a year-to-year comparison.
"To experience this level of growth in assets, loans and deposits in this economy is an indication of the hard work of our staff, as well as the strength of the unique markets we serve. We believe Cumberland and Harnett counties, in particular, are poised for tremendous growth due to BRAC (Base Realignment and Closure). In a recent article in the Fayetteville Observer, it was reported that BRAC would bring 40,000 new residents to Fayetteville, Cumberland County and the surrounding area by 2013, which will result in many new businesses and other opportunities as these communities support this incredible growth. New Century Bank is doing, and will continue to do, all we can to meet the financial services needs of these new residents, and to support our communities as we welcome this growth.
"New Century remains well-capitalized, which is the highest regulatory standard," Hedgepeth said. "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 sufficient liquidity, meeting the borrowing needs of the markets we serve, and positioning the Company for future growth,"
New Century Bank is headquartered in Dunn and has offices in Dunn, Clinton, Fayetteville (2), Goldsboro, Lillington, Lumberton, Pembroke, and Raeford.
The information as of and for the quarter ended September 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.
New Century Bancorp, Inc. Selected Financial Information and Other Data ($ in thousands, except per share data) At or for the three months ended September June March December September 30, 30, 31, 31, 30, 2009 2009 2009 2008 2008 --------- ------- ------ -------- --------- Summary of Operations: Total interest income $8,223 $8,009 $8,252 $8,348 $8,678 Total interest expense 3,170 3,459 3,673 3,991 4,043 --------- ------- ------ -------- --------- Net interest income 5,053 4,550 4,579 4,357 4,635 Provision for loan losses 2,377 1,414 685 2,142 895 --------- ------- ------ -------- --------- Net interest income after provision 2,676 3,136 3,894 2,215 3,740 Noninterest income 812 792 845 790 745 Noninterest expense 4,075 4,428 4,080 4,158 4,233 --------- ------- ------ -------- --------- Income (loss) before income taxes (587) (500) 659 (1,153) 252 Provision for income taxes (benefit) (218) (247) 251 (487) 93 --------- ------- ------ -------- --------- Net income (loss) $(369) $(253) $408 $(666) $159 ========= ======= ====== ======== ========= Share and Per Share Data: Earnings (loss) per share - basic $(0.05) $(0.04) $0.06 $(0.10) $0.02 Earnings (loss) per share - diluted (0.05) (0.04) 0.06 (0.10) 0.02 Book value per share 9.22 9.21 9.23 9.17 9.03 Tangible book value per share 7.82 7.80 7.82 7.76 7.61 Ending shares outstanding 6,837,742 6,836,149 6,831,149 6,831,149 6,827,649 Weighted average shares outstanding: Basic 6,837,292 6,831,973 6,831,149 6,829,731 6,826,481 Diluted 6,837,292 6,831,973 6,835,476 6,829,731 6,879,919 Selected Performance Ratios: Return on average assets -0.23% -0.16% 0.27% -0.43% 0.11% Return on average equity -2.30% -1.60% 2.61% -4.27% 1.02% Net interest margin 3.52% 3.16% 3.26% 3.07% 3.34% Efficiency ratio (1) 69.48% 82.89% 75.22% 80.78% 78.68% Period End Balance Sheet Data: Loans, net of unearned income $472,578 $467,872 $469,794 $460,626 $457,784 Total Earning Assets 591,973 573,951 584,030 560,534 547,965 Goodwill and other intangible assets 9,565 9,603 9,642 9,680 9,719 Total Assets 636,810 629,000 628,748 605,767 596,457 Deposits 533,350 527,621 523,537 505,119 501,823 Short term debt 25,693 23,461 27,408 23,175 17,896 Long term debt 12,372 12,372 12,372 12,372 12,372 Shareholders' equity 63,013 62,947 63,059 62,659 61,653 Selected Average Balances: Gross Loans $469,668 $469,581 $468,062 $458,100 $456,120 Total Earning Assets 570,059 577,774 570,221 562,415 551,353 Goodwill and other intangible assets 9,584 9,622 9,660 9,699 9,738 Total Assets 634,312 630,180 616,026 607,685 595,049 Deposits 532,427 526,894 513,079 508,911 500,914 Short term debt 23,020 24,606 24,458 21,659 17,077 Long term debt 12,372 12,372 12,372 12,372 12,372 Shareholders' equity 63,588 63,615 63,421 61,868 62,017 Asset Quality Ratios: Nonperforming loans $16,003 $13,352 $7,739 $8,630 $9,148 Other real estate owned 2,346 2,196 2,333 2,799 677 Allowance for loan losses 10,317 8,519 7,792 8,860 7,140 Nonperforming loans (2) to period-end loans 3.39% 2.85% 1.65% 1.87% 2.00% Allowance for loanlosses to period- end loans 2.18% 1.82% 1.66% 1.92% 1.56% Delinquency Ratio (3) 1.61% 0.51% 0.98% 0.32% 0.34% Net loan charge-offs to average loans 0.49% 0.59% 1.52% 0.39% 0.21% --------- ------- ------ -------- --------- At or for the nine months ended September September September 30, 2009 30, 2008 30, 2007 --------- --------- --------- Summary of Operations: Total interest income $24,483 $26,886 $31,255 Total interest expense 10,302 13,382 15,324 --------- --------- --------- Net interest income 14,181 13,504 15,931 Provision for loan losses 4,477 2,141 5,518 --------- --------- --------- Net interest income after provision 9,704 11,363 10,413 Noninterest income 2,449 2,338 2,970 Noninterest expense 12,581 12,980 12,166 --------- --------- --------- Income (loss) before income taxes (428) 721 1,217 Provision for income taxes (benefit) (214) 248 419 --------- --------- --------- Net income (loss) $(214) $473 $798 ========== ========= ========= Share and Per Share Data: Earnings (loss) per share - basic $(0.03) $0.07 $0.12 Earnings (loss) per share - diluted (0.03) 0.07 0.12 Book value per share 9.22 9.03 8.92 Tangible book value per share 7.82 7.61 7.45 Ending shares outstanding 6,837,742 6,827,649 6,730,874 Weighted average shares outstanding: Basic 6,833,494 6,808,914 6,560,750 Diluted 6,833,494 6,811,297 6,761,640 Selected Performance Ratios: Return on average assets -0.05% 0.11% 0.18% Return on average equity -0.45% 1.01% 1.79% Net interest margin 3.31% 3.26% 3.97% Efficiency ratio (1) 75.65% 81.93% 64.37% Period End Balance Sheet Data: Loans, net of unearned income $472,578 $457,784 $462,713 Total Earning Assets 591,973 547,965 545,760 Goodwill and other intangible assets 9,565 9,719 9,873 Total Assets 636,810 596,457 592,328 Deposits 533,350 501,823 504,535 Short term debt 25,693 17,896 12,974 Long term debt 12,372 12,372 12,372 Shareholders' equity 63,013 61,653 60,035 Selected Average Balances: Gross Loans $469,109 $449,362 $449,114 Total Earning Assets 572,684 552,240 536,324 Goodwill and other intangible assets 9,622 9,776 9,929 Total Assets 626,903 597,303 580,595 Deposits 524,204 502,603 490,053 Short term debt 24,023 17,593 16,070 Long term debt 12,372 12,372 12,372 Shareholders' equity 63,542 62,187 59,604 Asset Quality Ratios: Nonperforming loans $16,003 $9,148 $6,300 Other real estate owned 2,346 669 387 Allowance for loan losses 10,317 7,140 8,636 Nonperforming loans (2) to period-end loans 3.39% 2.00% 1.36% Allowance for loan losses to period-end loans 2.18% 1.56% 1.87% Delinquency Ratio (3) 1.61% 0.34% 1.43% Net loan charge-offs to average loans 0.86% 1.09% 1.30% --------- --------- --------- (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. http://www.newcenturybanknc.com/
New Century Bancorp
CONTACT: Lisa F. Campbell, Executive Vice President, Chief Operating
Officer and Chief Financial Officer, +1-910-892-7080;
lisac@newcenturybanknc.com
Web Site: http://www.newcenturybanknc.com/
