BELMONT, Mass., Feb. 10, 2012 /PRNewswire/ -- BSB Bancorp, Inc. (NASDAQ-BLMT) (the "Company"), the holding company for Belmont Savings Bank (the "Bank"), a state-chartered savings bank headquartered in Belmont, Massachusetts, today announced earnings for the fourth quarter and the year ended December 31, 2011.
For the quarter ended December 31, 2011, the Company reported a net loss of $1.3 million, as compared to net income of $178,000 for the fourth quarter of 2010. Net income for the year ended December31, 2011 and 2010 amounted to $299,000 and $1.8 million, respectively. Included in the fourth quarter of 2011 was a non-recurring expense of $1.4 million (net of taxes) for the contribution made to the Belmont Savings Bank Foundation.
The Company was organized to facilitate the conversion of BSB Bancorp, MHC from the mutual to the stock form of organization, which was completed on October 4, 2011. The offering of the Company's common stock in connection with the conversion, which was oversubscribed, closed at the adjusted maximum of the offering range. The Company issued 8,993,000 shares of common stock to subscribers in the offering at an offering price of $10.00 per share and the Company's stock began trading on October 5, 2011 on the Nasdaq Capital Market under the symbol "BLMT".
Robert M. Mahoney, President and Chief Executive Officer, said, "We have completed our first quarter as a publicly traded company. While the income statement was negatively impacted by large conversion-related expenses, our underlying business continues to grow profitably with particular strength in commercial real estate lending and deposit growth. Credit quality remains sound as our local economy continues to improve. Importantly, our ability to positively affect our community has been greatly enhanced by the creation of the $2 million Belmont Savings Bank Foundation."
Net interest and dividend income before provision for loan losses for the quarter ended December 31, 2011 increased $1.6 million or 47.1% as compared to the quarter ended December 31, 2010. This increase in net interest and dividend income was partially offset by an increase in the provision for loan losses of $556,000, resulting in a $1.0 million or 32.4% increase in net interest and dividend income after provision for loan losses. Net interest and dividend income before provision for loan losses for the year ended December 31, 2011 increased $2.9 million or 21.6% as compared to the year ended December 31, 2010. This increase in net interest and dividend income was partially offset by an increase in the provision for loan losses of $1.8 million.
The Company's net interest margin increased to 3.14% for the quarter ended December 31, 2011, from 2.83% for the quarter ended December 31, 2010, an improvement of 31 basis points. For the year ended December 31, 2011, the Company's net interest margin increased to 3.08% from 2.86% for the year ended December 31, 2010, an improvement of 22 basis points. The margin improvement was the result of shifting asset focus onto higher yielding loans, focusing deposit growth on lower cost core deposits and the replacement of maturing advances with lower cost advances.
Non-interest income for the quarter ended December 31, 2011 totaled $536,000 as compared to $293,000 for the fourth quarter of 2010. The increase was primarily due to increased customer service fees and a higher net gain on sales of loans in the fourth quarter of 2011 and a $93,000 net realized loss on investment securities in the fourth quarter of 2010. For the year ended December 31, 2011, non-interest income amounted to $4.5 million as compared to $1.7 million for the year ended December 31, 2010. This increase was a result of $2.8 million in net realized gains on investment securities as a result of the liquidation of the equity portfolio in the first quarter of 2011, as compared to $284,000 in net realized gains in 2010.
Non-interest expense for the quarter ended December 31, 2011 amounted to $6.6 million as compared to $3.9 million for the fourth quarter of 2010. Non-interest expense for the year ended December 31, 2011 amounted to $18.2 million, an increase of $5.3 million from 2010. These increases were primarily the result of new staff added to execute the Company's commercial and consumer business strategies, a $2.0 million charitable contribution to the Belmont Savings Bank Foundation, and costs associated with transitioning into a public company.
Since December 31, 2010, the Company's assets have increased by $168.8 million or 33.7% to $669.0 million. The Company experienced net loan growth, excluding loans held for sale, of $173.0 million, or 51.4%, from December31, 2010 which was primarily the result of significant increases to the commercial real estate and the indirect auto portfolios, which have increased by $75.0 million and $62.7 million, respectively. The Company does not anticipate continuing the rapid growth in the indirect auto portfolio that took place in 2011, as we expect to sell more of the originations going forward. Throughout 2011, we also increased residential one-to-four family loans, home equity lines of credit, and commercial business loans. The substantial loan growth was funded primarily through growth in deposits and the stock offering proceeds.
At December31, 2011, deposits totaled $430.7million, an increase of $83.8million or 24.2% from December31, 2010. Hal R. Tovin, Executive Vice President and Chief Operating Officer, said, "This deposit growth is the result of the execution of our strategic initiatives to grow our customer base through a) competitive products linked to core checking accounts, b) implementation of a new branch banking sales and service program and c) local, multi-channel marketing. In addition, the evolution of our Small Business sales team and cross sell initiatives by our commercial lenders further contributed to this performance."
The allowance for loan losses in total and as a percentage of total loans as of December 31, 2011 equaled $4.8million and 0.93%, respectively, as compared to $2.9million and 0.85%, respectively, as of December31, 2010. The Company recorded a provision for loan losses of $2.3million for the year ended 2011 as compared to $438,000 for the year ended 2010. This increase reflected changes in loan volume and composition in each period, and to a lesser extent higher specific allocations established against certain loans in 2011. Additionally, as part of a continuous review and analysis of current market and economic conditions by management, the Company adjusted the reserve ratio applied to certain loan categories in 2011. Although non-performing loans have increased to $4.4 million at December 31, 2011 from $1.7 million at December 31, 2010, $1.4 million of the non-performing loans were paid current and $276,000 were less than 90 days past due as of December 31, 2011.
Company Profile
BSB Bancorp, Inc. is headquartered in Belmont, Massachusetts and is the holding company for Belmont Savings Bank. The Bank provides financial services to individuals, families and businesses through its four full-service branch offices located in Belmont and Watertown in Southeast Middlesex County, Massachusetts. The Bank's primary lending market includes Essex, Middlesex, Norfolk and Suffolk Counties, Massachusetts. The Company's common stock is traded on the NASD Capital Market under the symbol "BLMT". For more information, visit the Company's website at www.belmontsavings.com.
Forward-looking statements
Certain statements herein constitute "forward-looking statements" within the meaning of Section27A of the Securities Act of 1933 and Section21E of the Securities Exchange Act of 1934, as amended. These statements are based on the beliefs and expectations of management, as well as the assumptions made using information currently available to management. Since these statements reflect the views of management concerning future events, these statements involve risks, uncertainties and assumptions. As a result, actual results may differ from those contemplated by these statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like "believe," "expect," "anticipate," "estimate," and "intend" or future or conditional verbs such as "will," "would," "should," "could" or "may." Certain factors that could cause actual results to differ materially from expected results include changes in the interest rate environment, changes in general economic conditions, legislative and regulatory changes that adversely affect the businesses in which the Company is engaged and changes in the securities market. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The Company disclaims any intent or obligation to update any forward-looking statements, whether in response to new information, future events or otherwise, except as may be required by law.
Contact: | Robert M. Mahoney | |
President and Chief Executive Officer | ||
Phone: | 617-484-6700 | |
Email: | robert.mahoney@belmontsavings.com | |
BSB BANCORP, INC AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS (Dollars in thousands) | ||||||||
December 31, 2011 | December 31, 2010 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Cash and due from banks | $ 1,196 | $ 3,108 | ||||||
Federal funds sold | - | 2,525 | ||||||
Money market mutual funds | - | 7,762 | ||||||
Interest-bearing deposits in other banks | 21,599 | 7,572 | ||||||
Cash and cash equivalents | 22,795 | 20,967 | ||||||
Interest-bearing time deposits with other banks | 119 | 119 | ||||||
Investments in available-for-sale securities, at fair value | - | 14,274 | ||||||
Investments in held-to-maturity securities, at cost | 89,391 | 93,899 | ||||||
Federal Home Loan Bank stock, at cost | 8,038 | 8,038 | ||||||
Loans held for sale | 15,877 | 3,775 | ||||||
Loans, net of allowance for loan losses of $4,776 as of | ||||||||
December 31, 2011 (unaudited) and $2,889 as of December 31, 2010 | 509,964 | 336,916 | ||||||
Premises and equipment, net | 2,000 | 1,939 | ||||||
Accrued interest receivable | 2,185 | 2,121 | ||||||
Deferred tax asset, net | 4,315 | 2,913 | ||||||
Income taxes receivable | - | 908 | ||||||
Bank-owned life insurance | 12,420 | 11,954 | ||||||
Other assets | 1,901 | 2,423 | ||||||
Total assets | $ 669,005 | $ 500,246 | ||||||
LIABILITIES AND EQUITY | ||||||||
Deposits: | ||||||||
Noninterest-bearing | $ 55,900 | $ 30,155 | ||||||
Interest-bearing | 374,754 | 316,686 | ||||||
Total deposits | 430,654 | 346,841 | ||||||
Federal Home Loan Bank advances | 95,600 | 92,800 | ||||||
Securities sold under agreements to repurchase | 2,985 | 2,654 | ||||||
Other borrowed funds | 1,502 | 5,199 | ||||||
Accrued interest payable | 177 | 223 | ||||||
Deferred compensation liability | 4,173 | 3,929 | ||||||
Income taxes payable | 121 | - | ||||||
Other liabilities | 2,287 | 1,673 | ||||||
Total liabilities | 537,499 | 453,319 | ||||||
Stockholders' Equity: | ||||||||
Common stock; $0.01 par value, 100,000,000 shares authorized; 9,172,860 | ||||||||
and 0 shares issued and outstanding at December 31, 2011 and 2010, respectively | 92 | - | ||||||
Additional paid-in capital | 90,016 | - | ||||||
Retained earnings | 45,951 | 45,652 | ||||||
Accumulated other comprehensive (loss) income | (5) | 1,275 | ||||||
Unearned compensation - ESOP | (4,548) | - | ||||||
Total stockholders' equity | 131,506 | 46,927 | ||||||
Total liabilities and stockholders' equity | $ 669,005 | $ 500,246 | ||||||
Asset Quality Data: | ||||||||
Total non-performing loans | 4,427 | 1,707 | ||||||
Non-performing loans to total loans | 0.86% | 0.50% | ||||||
Non-performing assets to total assets | 0.66% | 0.34% | ||||||
Allowance for loan losses to non-performing loans | 107.88% | 169.24% | ||||||
Allowance for loan losses to total loans | 0.93% | 0.85% | ||||||
BSB BANCORP, INC AND SUBSIDIARY CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in thousands) | |||||||||||||
Three months ended | Twelve months ended | ||||||||||||
December 31, | December 31, | ||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||
(unaudited) | (unaudited) | ||||||||||||
Interest and dividend income: | |||||||||||||
Interest and fees on loans | $ 5,456 | $ 4,264 | $ 19,525 | $ 17,967 | |||||||||
Interest on debt securities: | |||||||||||||
Taxable | 674 | 647 | 2,536 | 2,914 | |||||||||
Dividends | 19 | 90 | 127 | 298 | |||||||||
Other interest income | 30 | 2 | 46 | 9 | |||||||||
Total interest and dividend income | 6,179 | 5,003 | 22,234 | 21,188 | |||||||||
Interest expense: | |||||||||||||
Interest on deposits | 901 | 897 | 3,656 | 3,817 | |||||||||
Interest on Federal Home Loan Bank advances | 330 | 689 | 1,892 | 3,457 | |||||||||
Interest on securities sold under agreements to repurchase | 4 | 6 | 16 | 33 | |||||||||
Interest on other borrowed funds | 12 | 58 | 81 | 236 | |||||||||
Total interest expense | 1,247 | 1,650 | 5,645 | 7,543 | |||||||||
Net interest and dividend income | 4,932 | 3,353 | 16,589 | 13,645 | |||||||||
Provision for loan losses | 747 | 191 | 2,285 | 438 | |||||||||
Net interest and dividend income after provision | |||||||||||||
for loan losses | 4,185 | 3,162 | 14,304 | 13,207 | |||||||||
Noninterest income: | |||||||||||||
Customer service fees | 200 | 104 | 637 | 453 | |||||||||
Income from bank-owned life insurance | 124 | 121 | 435 | 474 | |||||||||
Net gain on sales of loans | 154 | 137 | 462 | 340 | |||||||||
Net gain on sales and calls of securities | 2 | 166 | 2,790 | 166 | |||||||||
Net (loss) gain on trading securities | - | (55) | - | 322 | |||||||||
Writedown of impaired securities | - | (204) | - | (204) | |||||||||
Other income | 56 | 24 | 160 | 143 | |||||||||
Total noninterest income | 536 | 293 | 4,484 | 1,694 | |||||||||
Noninterest expense: | |||||||||||||
Salaries and employee benefits | 2,814 | 2,369 | 10,203 | 8,009 | |||||||||
Trustee fees | 68 | 80 | 295 | 311 | |||||||||
Occupancy expense | 180 | 201 | 749 | 727 | |||||||||
Equipment expense | 102 | 85 | 350 | 247 | |||||||||
Deposit insurance | 125 | 88 | 456 | 497 | |||||||||
Data processing | 334 | 236 | 1,059 | 933 | |||||||||
Professional fees | 330 | 194 | 818 | 645 | |||||||||
Marketing | 233 | 259 | 930 | 533 | |||||||||
Other expense | 2,388 | 345 | 3,334 | 952 | |||||||||
Total noninterest expense | 6,574 | 3,857 | 18,194 | 12,854 | |||||||||
(Loss) income before income tax (benefit) expense | (1,853) | (402) | 594 | 2,047 | |||||||||
Income tax (benefit) expense | (516) | (580) | 295 | 220 | |||||||||
Net (loss) income | $ (1,337) | $ 178 | $ 299 | $ 1,827 | |||||||||
Performance Ratios: | |||||||||||||
Return on assets | (0.82)% | 0.14% | 0.05% | 0.36% | |||||||||
Return on equity | (4.13)% | 1.53% | 0.44% | 4.06% | |||||||||
Interest rate spread | 2.85% | 2.64% | 2.86% | 2.66% | |||||||||
Net interest margin | 3.14% | 2.83% | 3.08% | 2.86% | |||||||||
Efficiency ratio | 120.23% | 105.79% | 86.34% | 83.80% | |||||||||
SOURCE BSB Bancorp, Inc.
