1ST Constitution Bancorp Reports a 48% Increase in Net Income for the First Quarter Ended March 31, 2012


CRANBURY, NJ--(Marketwire -05/07/12)- 1ST Constitution Bancorp (FCCY - News), parent company of 1ST Constitution Bank, reported net income of $1.16 million for the first quarter ended March 31, 2012, a 48% increase above the $790 thousand in net income for the first quarter of 2011. Diluted earnings were $0.23 per common share for the three months ended March 31, 2012, compared with $0.15 per common share reported for the three months ended March 31, 2011. All share and per share data for the respective reporting periods have been adjusted for a 5% stock dividend paid on common shares on February 2, 2012.

Robert F. Mangano, President and Chief Executive Officer, said, "The increase in net income for the first quarter ended March 31, 2012 was principally the result of an increase in net-interest income and non-interest income, partially offset by the increased non-interest expense on a comparative basis commensurate with the growth of the Company."

Total assets as of March 31, 2012 decreased to $749.6 million from $791.7 million at December 31, 2011. Loans at March 31, 2012 were $438.5 million, compared with $475.4 million at December 31, 2011; total investment securities at March 31, 2012 were $221.8 million, compared to $236.2 million at December 31, 2011, and total deposits at March 31, 2012 increased to $658.6 million from $623.9 million at December 31, 2011.

Net interest income for the three months ended March 31, 2012 totaled $6.6 million, an increase of 28.4% from $5.2 million earned for the first quarter of 2011. Further supporting earnings was the continued generation of non-interest income, which increased by 13.7% to $1.2 million for the quarter ended March 31, 2012, from $1.0 million earned for the first quarter of 2011.

Non-interest expense increased to $5.6 million for the first quarter of 2012, compared to $4.7 million for the first quarter of 2011. The key increases in non-interest expense related to other real estate owned expenses, occupancy, salary, and equipment expense associated with the previously announced branch acquisition in March 2011, and increases in salary and employee benefits primarily relating to merit increases, increased health costs, and overall increases in staffing levels.

Total consolidated assets at March 31, 2012 were $749.6 million, representing a decrease of $42.1 million, or 5.3%, from total consolidated assets of $791.7 million at December 31, 2011. The decrease in assets was primarily due to seasonal run-off in outstanding loans attributed to the Company's mortgage warehousing business.

For the first quarter of 2012, the provision for loan losses was $600 thousand, and net charge-offs were $253 thousand, compared to a provision for loan losses of $400 thousand and net charge-offs of $413 thousand for the first quarter of 2011.

At March 31, 2012, the allowance for loan losses was $5.9 million, or 1.34% of total loans, compared to $5.5 million, or 1.16% of total loans, at December 31, 2011. Total non-performing assets, which includes nonaccrual loans and OREO, was, as a percentage of total assets, 1.97% at March 31, 2012 and 1.95% at December 31, 2011.

Regulatory Capital Ratios continue to reflect a strong capital position. The Company's total risk-based capital, Tier I capital, and leverage capital were 13.54%, 12.46%, and 9.05%, respectively, at March 31, 2012. The regulatory requirements to be considered "well-capitalized" for total risk-based capital, Tier 1 capital, and leverage capital are 10%, 6%, and 5%, respectively.

1ST Constitution Bancorp, through its primary subsidiary, 1ST Constitution Bank, operate fourteen branch banking offices in Cranbury (2), Fort Lee, Hamilton, Hightstown, Hillsborough, Hopewell, Jamesburg, Lawrenceville, Perth Amboy, Plainsboro, Rocky Hill, West Windsor, and Princeton, New Jersey.

1ST Constitution Bancorp is traded on the Nasdaq Global Market under the trading symbol "FCCY" and can be accessed through the Internet at www.1STCONSTITUTION.com

The foregoing contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are not historical facts and include expressions about management's confidence and strategies and management's expectations about new and existing programs and products, relationships, opportunities, taxation, technology and market conditions. These statements may be identified by such forward-looking terminology as "expect," "look," "believe," "anticipate," "may," "will," or similar statements or variations of such terms. Actual results may differ materially from such forward-looking statements. Factors that may cause results to differ materially from such forward-looking statements include, but are not limited to, changes in the direction of the economy in New Jersey, the direction of interest rates, effective income tax rates, loan prepayment assumptions, continued levels of loan quality and origination volume, continued relationships with major customers including sources for loans, a higher level of net loan charge-offs and delinquencies than anticipated, bank regulatory rules, regulations or policies that restrict or direct certain actions, the adoption, interpretation and implementation of new or pre-existing accounting pronouncements, a change in legal and regulatory barriers including issues related to compliance with anti-money laundering and bank secrecy act laws, as well as the effects of general economic conditions and legal and regulatory barriers and structure. 1ST Constitution Bancorp assumes no obligation for updating any such forward-looking statements at any time, except as required by law.

1st Constitution Bancorp
Selected Consolidated Financial Data (Unaudited)

($ in thousands, except per share amounts) For the Three Months
Ended March 31,
2012 2011
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Income Statement Data :
Interest income $ 8,034 $ 6,933
Interest expense 1,403 1,769
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Net interest income 6,631 5,164
Provision for loan losses 600 400
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Net interest income after prov.for loan
losses 6,031 4,764
Non-interest income 1,165 1,025
Non-interest expense 5,613 4,663
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Income before income taxes 1,583 1,126
Income tax expense 416 336
------------- -------------
Net income $ 1,167 $ 790
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Per Common Share Data (a) :
Earnings per common share - Basic $ 0.23 $ 0.16
Earnings per common share - Diluted $ 0.23 $ 0.15
Tangible book value per common share $ 10.00 $ 8.86
Average common shares outstanding
Basic 5,096,186 5,043,023
Diluted 5,150,640 5,136,949

(a) Includes the effect of the 5% stock
dividend paid February 2, 2012.

Performance Ratios :
Return on average assets 0.62% 0.49%
Return on average equity 8.46% 6.49%
Net interest margin (tax-equivalent basis) 3.98% 3.54%
Efficiency ratio 72.0% 75.3%

March 31, December 31,
2012 2011
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Balance Sheet Data :
Total Assets $ 749,600 $ 791,727
Investment Securities 221,814 236,158
Loans 438,522 475,432
Loans held for sale 17,497 19,234
Allowance for loan losses (5,882) (5,534)
Goodwill and other intangible assets 5,359 5,426
Deposits 658,564 623,862
Shareholders' Equity 56,343 55,000

Asset Quality Data :
Loans past due over 90 days and still
accruing $ 245 $ 0
Nonaccrual loans 2,718 2,991
OREO property 11,840 12,409
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Total non-performing assets : 14,803 15,400
Net charge-offs for the quarter and year,
respectively 253 2,787
Allowance for loan losses to total loans 1.34% 1.16%
Nonperforming loans to total loans 0.68% 0.63%
Nonperforming assets to total assets 1.97% 1.95%

Capital Ratios :
1st Constitution Bancorp
Tier 1 capital to average assets 9.05% 8.82%
Tier 1 capital to risk weighted assets 12.46% 11.27%
Total capital to risk weighted assets 13.54% 12.22%
1st Constitution Bank
Tier 1 capital to average assets 8.70% 8.49%
Tier 1 capital to risk weighted assets 11.95% 10.79%
Total capital to risk weighted assets 13.03% 11.73%
Robert F. Mangano
President & Chief Executive Officer
(609) 655-4500

Joseph M. Reardon
Sr. Vice President & Treasurer
(609) 655-4500

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