CLINTON, N.J., July 29 NJ-UnityBancorp-earns
CLINTON, N.J., July 29 /PRNewswire-FirstCall/ -- Unity Bancorp, Inc.
(Nasdaq: UNTY), parent company of Unity Bank, reported net income of $1.1
million, or $0.15 per diluted share, for the quarter ended June 30, 2008,
compared to $1.5 million, or $0.20 per diluted share, for the quarter ended
June 30, 2007. Return on average assets and average common equity for the
second quarter of 2008 were 0.56% and 9.29%, respectively, compared to 0.89%
and 13.14%, respectively, for the second quarter of 2007.
For the six months ended June 30, 2008, net income was $2.3 million, or
$0.32 per diluted share, compared to $3.0 million, or $0.39 per diluted share
for the same period a year ago. Return on average assets and average common
equity for the six months ended June 30, 2007, were 0.60% and 9.87%,
respectively, as compared to 0.88% and 12.94%, respectively, for the prior
year's comparable period.
Earnings for the quarter and six months ended were impacted by an other-
than-temporary impairment charge of $222 thousand before taxes, or $0.02 per
diluted share, related to Federal Home Loan Mortgage Corporation ("FHLMC" or
"Freddie Mac") perpetual callable preferred securities. The other-than-
temporary impairment charge was recorded on three perpetual preferred stock
issues classified as available for sale investment securities. Unity decided
to recognize the other-than-temporary impairment charge as of June 30, 2008
due to the recent volatility and decline in market value, and the uncertainty
that the securities will recover to book value. The book value of the
securities, including the impairment charge, is approximately $1.9 million.
The securities continue to perform according to their contractual terms and
all dividend payments are current.
Total assets at June 30, 2008, were $832.3 million, a 13.6% increase from
June 30, 2007. The increase in assets from the prior year was due to growth
in the Company's earning assets. Total loans at June 30, 2008, were $643.0
million, an 18.8% increase from June 30, 2007. The growth in the loan
portfolio occurred in all product lines. The SBA portfolio grew $26.0
million, or 34.5% from a year ago, in part due to the Company's previously
announced strategy to hold more SBA loans for long-term investment.
"Although I am disappointed with the impairment charge on the Freddie Mac
securities as well as the continued reduced premiums we are receiving on the
sale of SBA loans; I am extremely pleased with our core loan and deposit
growth for the quarter," said Unity President and Chief Executive Officer,
James A. Hughes. "Despite the challenging economic environment, the
fundamentals of our Company continue to be sound."
At June 30, 2008, the allowance for loan losses was $8.9 million, or 1.39%
of total loans, compared to 1.48% of total loans at June 30, 2007.
Nonperforming assets at June 30, 2008, were $6.9 million, or 1.07% of total
loans and other real estate owned (OREO), an increase of $1.9 million,
compared to nonperforming assets of $5.0 million or 0.92% of total loans and
OREO at June 30, 2007. The increase in nonperforming assets was primarily
related to a $2.0 million commercial loan.
Total deposits at June 30, 2008, were $671.9 million, a 12.7% increase
from June 30, 2007. This increase was primarily the result of growth in time
deposit, demand deposit, and interest-bearing checking accounts, partially
offset by the decline in savings. Demand deposits grew $6.5 million, or 8.8%
from June 30, 2007. Time deposits increased $102.4 million, or 46.8% from
June 30, 2007.
Total shareholders' equity was $48.0 million at June 30, 2008, consistent
with June 30, 2007, due to an increase in retained profits of the Company,
offset by the purchase of 316 thousand shares of common stock during the third
and fourth quarters of 2007. The Company does not anticipate additional
purchases of shares for the foreseeable future, as retained profits will be
used for future growth.
Net interest income was $6.8 million for the second quarter of 2008, an
increase of 12.3%, compared to the same period a year ago. Net interest
income was primarily benefited by an increase in interest-earning assets and a
stable net interest margin. Net interest margin was 3.66% for the second
quarter of 2008, compared to 3.71% for the second quarter of 2007. Due to the
decline in short-term interest rates, the Company expects that the net
interest margin will expand during the remainder of 2008.
Net interest income was $13.5 million for the six months ended June 30,
2008, an increase of 11.3% compared to $12.1 million a year ago. Net interest
income was benefited by an increase in interest-earning assets, partially
offset by an 8 basis point decrease in net interest margin. Net interest
margin was 3.65% for the six months ended June 30, 2008, compared to 3.73% for
the same period a year ago.
The provision for loan losses for the second quarter of 2008 was $650
thousand, compared to $350 thousand for the second quarter of 2007. Net loan
charge-offs for the quarter ended June 30, 2008, were $355 thousand, compared
to net loan charge-offs of $110 thousand for the quarter ended June 30, 2007.
The provision for loan losses was $1.1 million for the six months ended June
30, 2008, an increase of $550 thousand from the six months ended June 30,
2007. Net loan charge-offs for the six months ended June 30, 2008, were $538
thousand, compared to $177 thousand for the same period a year ago.
Total noninterest income for the second quarter of 2008 was $1.0 million.
Gains on sales of SBA loans amounted to $417 thousand for the second quarter
of 2008, compared to $824 thousand for the quarter ended June 30, 2007,
reflecting a lower volume of loans sold in accordance with the Company's
decision to retain more of these loans in its portfolio and lower premiums on
loans sold, due to current market conditions. Service charges on deposits for
the second quarter of 2008 were $341 thousand, consistent to the second
quarter of 2007. Service and loan fees were $302 thousand for the second
quarter of 2008, a decrease of $78 thousand from a year ago.
Total noninterest income for the six months ended June 30, 2008, was $2.5
million. Gains on sales of SBA loans amounted to $993 thousand for the six
months ended June 30, 2008, compared to $1.5 million for the six months ended
June 30, 2007, reflecting a lower volume of loans sold and lower premiums on
loans sold, due to the factors discussed above. Service charges on deposits
for the six months ended June 30, 2008 were $661 thousand, consistent with
2007. Service and loan fees were $602 thousand for the six months ended June
30, 2008, a decrease of $144 thousand from a year ago.
Total noninterest expenses for the second quarter of 2008 were $5.6
million, an increase of 6.6% from the prior year's comparable quarter.
Compensation and benefits expense increased 9.4%, due to the increased
staffing associated with expansion of the national SBA program and annual cost
of living increases. Occupancy and furniture and equipment expenses increased
10.7% and 4.8% respectively, due to branch expansion.
Total noninterest expenses for the six months ended June 30, 2008 were
$11.4 million, an increase of 6.6% compared to a year ago. Compensation and
benefits expense increased 9.2%, due to the increased staffing associated with
expansion of the national SBA program and annual cost of living increases.
Occupancy and furniture and equipment expenses increased 7.4% and 0.9%
respectively, due to branch expansion.
As of June 30, 2008, the Company's Tier I leverage capital ratio was
8.01%, Tier I risk-based capital ratio was 9.42% and total risk-based capital
ratio was 10.67%. All regulatory capital ratios exceeded the well-
capitalized, federal capital adequacy requirements as of June 30, 2008.
Unity Bancorp, Inc. is a financial service organization headquartered in
Clinton, New Jersey, with approximately $832 million in assets and $672
million in deposits. Unity Bank provides financial services to retail,
corporate and small business customers through its 16 retail service centers
located in Hunterdon, Middlesex, Somerset, Union and Warren Counties in New
Jersey and Northampton County, Pennsylvania. For additional information about
Unity, visit our website at www.unitybank.com, or call 800- 618-BANK.
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.
Unity Bancorp, Inc.
Consolidated Financial Highlights
(Dollars in thousands, except per share data)
BALANCE SHEET DATA:Jun. 30,Mar. 31,Jun. 30, Jun. 08 vs.
200820082007 Mar. 08 Jun. 07
Assets $832,315$807,874$732,403 3.0%13.6%
Deposits 671,881 642,282 596,093 4.6 12.7
Loans 643,039 602,943 541,385 6.7 18.8
Securities106,972 114,348 99,460 (6.5) 7.6
Shareholders' equity 47,951 47,896 48,242 0.1 (0.6)
Allowance for loan
losses 8,945 8,650 7,997 3.4 11.9
FINANCIAL DATA -
QUARTER TO DATE:
Net income before
taxes $1,599 $1,870 $2,218(14.5)% (27.9)%
Federal and state
income tax provision 495 626 676(20.9) (26.8)
Net income 1,104 1,244 1,542(11.3) (28.4)
Per share-basic 0.160.180.21 (9.0) (23.9)
Per share-diluted0.150.170.20(12.3) (25.5)
Return on average
assets 0.56% 0.65% 0.89%(13.8) (37.1)
Return on average
common equity 9.29 10.50 13.14 (11.5) (29.3)
Efficiency ratio69.59 71.95 67.22 (3.3) 3.5
FINANCIAL DATA -
YEAR TO DATE:
Net income before
taxes $3,469 - $4,299-(19.3)%
Federal and state
income tax provision 1,121 - 1,306-(14.2)
Net income 2,348 - 2,993-(21.6)
Per share-basic 0.33 -0.41-(19.5)
Per share-diluted0.32 -0.39-(17.9)
Return on average
assets 0.60% -0.88% - (31.8)%
Return on average
common equity 9.87 - 12.94-(23.7)
Efficiency ratio70.76 - 68.83- 2.8
SHARE INFORMATION:
Closing price per
share $6.95 $7.48 $10.90 (7.0)% (36.3)%
Cash dividends
declared0.050.050.05 --
Book value per share 6.766.766.54 - 3.3
Average diluted
shares outstanding
(QTD) 7,275 7,271 7,660 0.1 (5.0)
CAPITAL RATIOS:
Total equity to
total assets5.76% 5.93% 6.59%(2.9)% (12.6)%
Tier I capital to
average assets
(leverage) 8.018.069.21 (0.7) (13.0)
Tier I capital to
risk-adjusted assets9.429.66 11.07 (2.5) (14.9)
Total risk-based
capital10.67 10.91 13.72 (2.2) (22.2)
CREDIT QUALITY AND
RATIOS:
Nonperforming assets $6,887 $4,408 $4,977 56.2%38.4%
Net charge offs to
average loans (QTD) 0.23% 0.12% 0.08%91.7% 187.5%
Allowance for loan
losses to total loans 1.391.431.48 (2.8)(6.1)
Nonperforming assets
to total loans and
OREO1.070.730.92 46.6 16.3
Unity Bancorp, Inc.
Consolidated Balance Sheets
(In thousands) Jun. 30, Mar. 31, Jun. 30, Jun. 08 vs.
2008 2008 2007Mar. 08 Jun. 07
ASSETS
Cash and due from banks $20,368$19,698$14,696 3.4%38.6%
Federal funds sold and
interest bearing
deposits33,678 44,042 51,063 (23.5) (34.0)
Securities:
Available for sale 77,110 79,726 62,929(3.3)22.5
Held to maturity 29,862 34,622 36,531 (13.7) (18.3)
Total securities 106,972114,348 99,460(6.5) 7.6
Loans:
SBA - Held for sale25,605 23,632 8,914 8.3187.2
SBA - Held to
Maturity 75,988 71,798 66,634 5.8 14.0
Commercial387,302372,695342,328 3.9 13.1
Residential mortgage 95,100 76,734 69,41723.9 37.0
Consumer 59,044 58,084 54,092 1.7 9.2
Total loans 643,039602,943541,385 6.7 18.8
Less: Allowance for
loan losses8,945 8,650 7,997 3.4 11.9
Net loans 634,094594,293533,388 6.7 18.9
Goodwill and other
intangibles 1,581 1,585 1,596(0.3)(0.9)
Premises and equipment,
net 12,372 12,067 11,614 2.5 6.5
Accrued interest
receivable 4,095 4,131 3,687(0.9)11.1
Loan servicing asset 1,877 1,990 2,289(5.7) (18.0)
Bank Owned Life
Insurance5,674 5,622 5,467 0.9 3.8
FHLB/ACBB Stock 4,407 4,170 3,270 5.7 34.8
Other assets 7,197 5,928 5,87321.4 22.5
Total Assets $832,315 $807,874 $732,403 3.0%13.6%
LIABILITIES AND
SHAREHOLDERS' EQUITY
Deposits:
Noninterest-bearing
demand deposits $81,273$80,960$74,731 0.4% 8.8%
Interest-bearing
deposits:
Interest bearing
checking88,551 76,256 84,10716.1 5.3
Savings 180,665188,628218,273(4.2) (17.2)
Time, under
$100,000 236,241211,739138,44011.6 70.6
Time, $100,000 and
over85,151 84,699 80,542 0.5 5.7
Total deposits 671,881642,282596,093 4.6 12.7
Borrowed funds and
subordinated
debentures 110,465110,465 84,744 - 30.4
Accrued interest
payable779794595(1.9)30.9
Accrued expenses and
other liabilities1,239 6,437 2,729 (80.8) (54.6)
Total liabilities 784,364759,978684,161 3.2 14.6
Commitments and
Contingencies- - -
Shareholders' equity:
Common stock, no par
value, 12,500
shares authorized 52,281 49,600 49,0875.4 6.5
Retained earnings 1,593 3,379 1,435 (52.9)11.0
Treasury stock at
cost (4,169)(4,169) (1,121) -271.9
Accumulated other
comprehensive loss,
net of tax(1,754) (914) (1,159) 91.9 51.3
Total
shareholders'
equity47,951 47,896 48,2420.1 (0.6)
Total Liabilities and
Shareholders' Equity $832,315 $807,874$732,4033.0%13.6%
COMMON SHARES AT
PERIOD END:
Issued 7,520 7,509 7,478
Outstanding 7,095 7,084 7,371
Treasury 425425 107
N/M= Not meaningful
Unity Bancorp, Inc.
Consolidated Statements of Income
(In thousands, except per share data)
FOR THE THREE MONTHS ENDED Jun. 30 Mar.31, Jun. 30, Jun. 08 vs.
20082008 2007 Mar. 08 Jun. 07
INTEREST INCOME
Fed funds sold and interest on
deposits $111$180$221 (38.3)% (49.8)%
FHLB/ACBB Stock 76 100 56 (24.0)(35.7)
Securities:
Available for sale 932 875 7226.5 29.1
Held to maturity 398 437 478 (8.9)(16.7)
Total securities 1,330 1,312 1,2001.4 10.8
Loans:
SBA2,028 2,328 2,202 (12.9) (7.9)
Commercial 6,667 6,735 6,378 (1.0) 4.5
Residential mortgage 1,209 1,079 967 12.0 25.0
Consumer 846 901 951 (6.1)(11.0)
Total loan interest income 10,750 11,043 10,498 (2.7) 2.4
Total interest income 12,267 12,635 11,975 (2.9) 2.4
INTEREST EXPENSE
Interest bearing demand
deposits 350 366 477 (4.4)(26.6)
Savings deposits 918 1,349 2,122 (31.9)(56.7)
Time deposits3,006 3,220 2,153 (6.6) 39.6
Borrowed funds and subordinated
debentures 1,155 1,065 1,1368.5 1.7
Total interest expense 5,429 6,000 5,888 (9.5) (7.8)
Net interest income 6,838 6,635 6,0873.1 12.3
Provision for loan losses 650 450 350 44.4 85.7
Net interest income after
provision for loan losses 6,188 6,185 5,737 - 7.9
NONINTEREST INCOME
Service charges on deposit
accounts 341 320 3396.6 0.6
Service and loan fee income302 300 3800.7 (20.5)
Gain on SBA loan sales 417 576 824 (27.6)(49.4)
Bank owned life insurance 53 51 463.9 15.2
Net securities (loss) gains (206) 70 -nm* nm*
Other income 121 138 159 (12.3)(23.9)
Total noninterest income 1,028 1,455 1,748 (29.3)(41.2)
NONINTEREST EXPENSES
Compensation and benefits2,980 3,220 2,723 (7.5) 9.4
Processing and communications 544 570 563 (4.6) (3.4)
Occupancy, net 713 701 6441.7 10.7
Furniture and equipment413 388 3946.4 4.8
Professional fees 143 198 162 (27.8)(11.7)
Loan servicing costs 138 102 169 35.3 (18.3)
Advertising 79 62 105 27.4 (24.8)
Other 607 529 507 14.7 19.7
Total noninterest expenses 5,617 5,770 5,267 (2.7) 6.6
Income before taxes 1,599 1,870 2,218 (14.5)(27.9)
Federal and state income tax
provision 495 626 676 (20.9)(26.8)
Net Income $1,104 $1,244 $1,542 (11.3)% (28.4)%
*nm = Not Meaningful
Net Income Per Common Share -
Basic $0.16 $0.18 $0.21 (9.0)% (23.9)%
Net Income Per Common Share -
Diluted $0.15 $0.17 $0.20 (12.3)% (25.5)%
AVERAGE COMMON SHARES
OUTSTANDING:
Basic 7,092 7,075 7,334
Diluted 7,275 7,271 7,660
Unity Bancorp, Inc.
Consolidated Statements of Income
(Dollars in thousands, except per share data)
YEAR TO DATEJun. 30, Jun. 30, Jun. 08 vs.
2008 2007 Jun. 07
INTEREST INCOME
Fed funds sold and interest on deposits$291 $483 (39.8)%
FHLB/ACBB Stock 176114 54.4%
Securities:
Available for sale 1,807 1,444 25.1
Held to maturity 835 1,018 (18.0)
Total securities 2,642 2,4627.3
Loans:
SBA 4,356 4,542 (4.1)
Commercial 13,402 12,3668.4
Residential mortgage2,288 1,855 23.3
Consumer1,747 1,855 (5.8)
Total loan interest income 21,793 20,6185.7
Total interest income24,902 23,6775.2
INTEREST EXPENSE
Interest bearing demand deposits716 1,029 (30.4)
Savings deposits 2,267 4,293 (47.2)
Time deposits 6,226 4,123 51.0
Borrowed funds and subordinated
debentures 2,220 2,1264.4
Total interest expense 11,429 11,571 (1.2)
Net interest income 13,473 12,106 11.3
Provision for loan losses 1,100550 100.0
Net interest income after
provision for loan losses 12,373 11,5567.1
NONINTEREST INCOME
Service charges on deposit accounts 661688 (3.9)
Service and loan fee income 602746 (19.3)
Gain on SBA loan sales 993 1,503 (33.9)
Bank owned life insurance 104 959.5
Net securities (loss) gains(136)10nm*
Other income259385 (32.7)
Total noninterest income 2,483 3,427 (27.5)
NONINTEREST EXPENSES
Compensation and benefits 6,200 5,6789.2
Processing and communications 1,114 1,1130.1
Occupancy, net1,414 1,3177.4
Furniture and equipment 8017940.9
Professional fees 341298 14.4
Loan servicing costs240259 (7.3)
Advertising 141199 (29.1)
Other 1,136 1,026 10.7
Total noninterest expenses 11,387 10,6846.6
Income before taxes 3,469 4,299 (19.3)
Federal and state income tax
provision 1,121 1,306 (14.2)
Net Income $2,348 $2,993 (21.6)%
*nm = Not Meaningful
Net Income Per Common Share-Basic $0.33 $0.41 (19.5)%
Net Income Per Common Share-Diluted $0.32 $0.39 (17.9)%
Average common shares outstanding:
Basic 7,084 7,330
Diluted7,274 7,663
Unity Bancorp, Inc.
Consolidated Average Balance Sheets
with Resultant Interest and Rates
(Tax-equivalent basis, dollars in thousands)
Three Months Ended
June 30, 2008 March 31, 2008
Balance Interest RateBalance Interest Rate
ASSETS
Interest-earning assets:
Federal funds sold
and interest-
bearing deposits
with banks $22,351$111 2.00%$22,925$180 3.16%
FHLB/ACBB Stock 4,400 76 6.95 4,174 100 9.64
Securities:
Available for sale 76,613 961 5.02 70,757 908 5.13
Held to maturity 31,547 416 5.27 34,147 455 5.33
Total securities 108,160 1,377 5.09 104,904 1,363 5.20
Loans, net of
unearned discount:
SBA 101,006 2,028 8.03 98,614 2,328 9.44
Commercial 378,389 6,667 7.09 372,343 6,735 7.28
Residential
mortgage79,985 1,209 6.05 74,341 1,079 5.81
Consumer 58,608 846 5.81 57,482 901 6.30
Total loans 617,988 10,750 6.99 602,780 11,043 7.36
Total interest-
earning assets 752,899 12,314 6.57 734,783 12,686 6.93
Noninterest-earning
assets:
Cash and due from
banks 14,37714,991
Allowance for loan
losses(8,814) (8,690)
Other assets 31,26230,304
Total
noninterest-
earning assets36,82536,605
Total Assets $789,724 $771,388
LIABILITIES AND
SHAREHOLDERS' EQUITY
Interest-bearing
liabilities:
Interest-bearing
demand deposits $82,195 $ 350 1.71 $78,999 $ 366 1.86
Savings deposits 185,674 918 1.99 190,574 1,349 2.85
Time deposits 282,182 3,006 4.28 276,426 3,220 4.69
Total interest-
bearing
deposits 550,051 4,274 3.13 545,999 4,935 3.64
Borrowed funds and
subordinated
debentures 110,464 1,155 4.21 100,850 1,065 4.25
Total interest-
bearing
liabilities 660,515 5,429 3.31 646,849 6,000 3.73
Noninterest-bearing
liabilities:
Demand deposits78,87974,709
Other liabilities 2,553 2,191
Total
noninterest-
bearing
liabilities 81,43276,900
Shareholders' equity 47,77747,639
Total Liabilities and
Shareholders' Equity $789,724 $771,388
Net interest spread 6,885 3.26% 6,686 3.20%
Tax-equivalent basis
adjustment (47) (51)
Net interest income $6,838$6,635
Net interest margin 3.66% 3.64%
Unity Bancorp, Inc.
Consolidated Average Balance Sheets
with Resultant Interest and Rates
(Tax-equivalent basis, dollars in thousands)
Three Months Ended
June 30, 2008 June 30, 2007
Balance Interest RateBalance Interest Rate
ASSETS
Interest-earning assets:
Federal funds sold
and interest-
bearing deposits
with banks $22,351$111 2.00%$19,029$221 4.66%
FHLB/ACBB Stock4,400 76 6.95 3,289 56 6.83
Securities:
Available for
sale 76,613 961 5.02 61,843 734 4.75
Held to maturity31,547 416 5.27 37,501 496 5.29
Total
securities 108,160 1,377 5.09 99,344 1,230 4.95
Loans, net of
unearned discount:
SBA101,006 2,028 8.03 83,080 2,202 10.60
Commercial 378,389 6,667 7.09 335,081 6,378 7.63
Residential
mortgage 79,985 1,209 6.05 65,256 967 5.93
Consumer58,608 846 5.81 55,227 951 6.91
Total loans 617,988 10,750 6.99 538,644 10,498 7.81
Total interest-
earning assets 752,899 12,314 6.57 660,306 12,005 7.28
Noninterest-earning
assets:
Cash and due from
banks14,37712,170
Allowance for loan
losses (8,814) (8,022)
Other assets 31,26229,092
Total
noninterest-
earning assets 36,82533,240
Total Assets $789,724 $693,546
LIABILITIES AND
SHAREHOLDERS' EQUITY
Interest-bearing
liabilities:
Interest-bearing
demand deposits $82,195 $ 350 1.71 $84,729 $ 477 2.26
Savings deposits 185,674 918 1.99 211,478 2,122 4.02
Time deposits282,182 3,006 4.28 184,727 2,153 4.67
Total interest-
bearing
deposits550,051 4,274 3.13 480,934 4,752 3.96
Borrowed funds and
subordinated
debentures110,464 1,155 4.21 87,815 1,136 5.19
Total interest-
bearing
liabilities 660,515 5,429 3.31 568,749 5,888 4.15
Noninterest-bearing
liabilities:
Demand deposits 78,87975,469
Other liabilities 2,553 2,262
Total
noninterest-
bearing
liabilities 81,43277,731
Shareholders'
equity 47,77747,066
Total Liabilities and
Shareholders' Equity $789,724 $693,546
Net interest spread 6,885 3.26% 6,117 3.13%
Tax-equivalent basis
adjustment(47) (30)
Net interest income $6,838$6,087
Net interest margin 3.66% 3.71%
Unity Bancorp, Inc.
Consolidated Average Balance Sheets
with Resultant Interest and Rates
(Tax-equivalent basis, dollars in thousands)
Year to Date
June 30, 2008June 30, 2007
Balance Interest Rate Balance Interest Rate
ASSETS
Interest-earning assets:
Federal funds sold and
interest-bearing deposits
with banks$22,638 $291 2.59 % $19,835 $483 4.91 %
FHLB/ACBB Stock 4,287 176 8.26 3,020114 7.61
Securities:
Available for sale73,685 1,869 5.0761,999 1,468 4.74
Held to maturity 32,847871 5.3039,881 1,054 5.29
Total securities 106,532 2,740 5.14 101,880 2,522 4.95
Loans, net of unearned
discount:
SBA 99,810 4,356 8.7382,435 4,542 11.02
Commercial 375,366 13,402 7.18 326,905 12,366 7.63
Residential mortgage 77,163 2,288 5.9364,086 1,855 5.79
Consumer 58,045 1,747 6.0554,328 1,855 6.89
Total loans610,384 21,793 7.17 527,754 20,618 7.86
Total interest-earning
assets743,841 25,000 6.75 652,489 23,737 7.31
Noninterest-earning assets:
Cash and due from banks 14,684 12,199
Allowance for loan losses (8,752)(7,950)
Other assets30,783 29,292
Total noninterest-
earning assets 36,715 33,541
Total Assets$780,556 $686,030
LIABILITIES AND SHAREHOLDERS'
EQUITY
Interest-bearing liabilities:
Interest-bearing demand
deposits $80,597 $ 716 1.79 $91,114 $1,029 2.28
Savings deposits 188,124 2,267 2.42 211,180 4,293 4.10
Time deposits 279,304 6,226 4.48 177,657 4,123 4.68
Total interest-bearing
deposits 548,025 9,209 3.38 479,951 9,445 3.97
Borrowed funds and
subordinated debentures 105,657 2,220 4.2381,509 2,126 5.26
Total interest-bearing
liabilities 653,682 11,429 3.52 561,460 11,571 4.16
Noninterest-bearing
liabilities:
Demand deposits 76,794 75,346
Other liabilities2,372 2,593
Total noninterest-
bearing
liabilities79,166 77,939
Shareholders' equity47,708 46,631
Total Liabilities and
Shareholders' Equity $780,556 $686,030
Net interest spread 13,571 3.23 % 12,166 3.15 %
Tax-equivalent basis adjustment (98)(60)
Net interest income $13,473 $12,106
Net interest margin 3.65 % 3.73 %
Unity Bancorp, Inc.
Allowance for Loan Losses and Loan Quality Schedules
(Dollars in thousands)
06/30/ 03/31/ 12/31/ 09/30/ 06/30/
2008 2008 2007 2007 2007
ALLOWANCE FOR LOAN LOSSES:
Balance, beginning of quarter$8,650 $8,383 $8,183 $7,997 $7,757
Provision charged to expense 650 450 550 450 350
9,3008,8338,7338,447 8,107
Less: Charge offs
SBA249 264 260 270 124
Commercial 60- 126 24 5
Residential mortgage - 25-- -
Consumer566 20 28 -
Total Charge Offs 365 295 406 322 129
Add: Recoveries
SBA 5 60 53 41 12
Commercial 4237 2
Residential mortgage ---- -
Consumer 1 50- 10 5
Total Recoveries 10 112 56 58 19
Net Charge Offs355 183 350 264 110
Balance, end of quarter $8,945 $8,650 $8,383 $8,183 $7,997
LOAN QUALITY INFORMATION:
Nonperforming loans $6,621 $4,142 $5,461 $4,185 $4,611
Other real estate owned, net266 266 106 134 366
Nonperforming assets $6,887 $4,408 $5,567 $4,319 $4,977
Loans 90 days past due and still
accruing $76 $546 $155 $340$167
Allowance for loan losses to:
Total loans at period end1.39%1.43%1.42%1.44% 1.48%
Nonperforming loans 135.10 208.84 153.49 195.53 173.43
Nonperforming assets129.88 196.23 150.58 189.47 160.68
Net charge offs to average loans
(QTD) 0.23 0.12 0.24 0.190.08
Net charge offs to average loans
(YTD) 0.18 0.12 0.14 0.110.07
Nonperforming loans to total loans 1.03 0.69 0.93 0.740.85
Nonperforming assets to total
loans and OREO1.07 0.73 0.94 0.760.92
Unity Bancorp, Inc.
Quarterly Financial Data
06/30/08 03/31/08 12/31/07 09/30/07 06/30/07
SUMMARY OF INCOME
(in thousands):
Interest income$12,267 $12,635 $12,657 $12,566 $11,975
Interest expense 5,429 6,000 6,310 6,593 5,888
Net interest income 6,838 6,635 6,347 5,973 6,087
Provision for loan losses 650 450 550 450 350
Net interest income after
provision 6,188 6,185 5,797 5,523 5,737
Noninterest income 1,028 1,455 1,053 1,460 1,748
Noninterest expense 5,617 5,770 5,928 5,501 5,267
Income before income taxes 1,599 1,870 922 1,482 2,218
Federal and state income tax
provision 495 626 242 430 676
Net Income 1,104 1,244 680 1,052 1,542
Net Income per Common Share:
Basic $0.16 $0.18 $0.10 $0.15 $0.21
Diluted 0.15 0.17 0.09 0.14 0.20
COMMON SHARE DATA:
Cash dividends declared $0.05 $0.05 $0.05 $0.05 $0.05
Book value at quarter end 6.76 6.76 6.70 6.61 6.54
Market value at quarter end 6.95 7.48 8.10 10.55 10.90
Average common shares
outstanding:
(000's)
Basic 7,092 7,075 7,107 7,215 7,334
Diluted 7,275 7,271 7,328 7,462 7,660
Common shares outstanding at
period end (000's) 7,095 7,084 7,063 7,154 7,371
OPERATING RATIOS:
Return on average assets 0.56% 0.65% 0.36% 0.57% 0.89%
Return on average common
equity 9.29 10.50 5.78 8.89 13.14
Efficiency ratio 69.59 71.95 74.07 74.23 67.22
BALANCE SHEET DATA
(in thousands):
Assets$832,315 $807,874 $752,196 $746,821 $732,403
Deposits 671,881 642,282 601,268 612,215 596,093
Loans 643,039 602,943 590,132 567,597 541,385
Shareholders' equity47,95147,89647,26047,26148,242
Allowance for loan losses8,945 8,650 8,383 8,183 7,997
TAX-EQUIVALENT YIELDS AND
RATES:
Interest-earning assets 6.57% 6.93% 7.15% 7.16% 7.28%
Interest-bearing liabilities 3.31 3.73 4.05 4.27 4.15
Net interest spread 3.26 3.20 3.10 2.89 3.13
Net interest margin 3.66 3.64 3.62 3.44 3.71
CREDIT QUALITY:
Nonperforming assets
(in thousands) $6,887$4,408$5,567$4,319$4,977
Allowance for loan losses to
period-end loans1.39% 1.43% 1.42% 1.44% 1.48%
Net charge offs to average
loans0.23 0.12 0.24 0.19 0.08
Nonperforming assets to loans
and OREO 1.07 0.73 0.94 0.76 0.92
CAPITAL AND OTHER:
Total equity to assets5.76% 5.93% 6.28 6.33% 6.59
Tier I capital to average
assets (leverage)8.01 8.06 8.25 8.37 9.21
Tier I capital to
risk-adjusted assets 9.42 9.66 9.81 10.51 11.07
Total capital to risk-adjusted
assets 10.67 10.91 11.06 11.76 13.72
Number of banking offices 1617171615
Number of ATMs 1920201918
Number of employees191 188 201 197 195
SOURCE Unity Bancorp, Inc.
