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NorthEast Community Bancorp, Inc. Reports Results for the Three and Six Months Ended June 30, 2022

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NorthEast Community Bancorp, Inc.
NorthEast Community Bancorp, Inc.

WHITE PLAINS, N.Y., July 22, 2022 (GLOBE NEWSWIRE) -- NorthEast Community Bancorp, Inc. (Nasdaq: NECB) (the “Company”), the parent holding company of NorthEast Community Bank (the “Bank”), reported net income of $5.4 million and $9.0 million, or $0.35 and $0.58 per basic and diluted common share, for the three months and six months ended June 30, 2022 compared to net income of $3.7 million and $7.0 million, or $0.23 and $0.43 per basic and diluted common share, for the three months and six months ended June 30, 2021.

Kenneth A. Martinek, NorthEast Community Bancorp’s Chairman of the Board and Chief Executive Officer, stated, “We are pleased to report another quarter of strong earnings due to the strong performance of our loan portfolio.   Despite the continuing COVID-19 pandemic and the recent increase in interest rates, loan demand remained strong with originations and outstanding commitments increasing quarter over quarter. Our commitments, loans-in-process, and standby letters of credit outstanding totaled $879.0 million at June 30, 2022 compared to $749.0 million at December 31, 2021. The performance of our loan portfolio remains strong with only two non-residential loans secured by the same property to one borrower that are on non-accrual and in foreclosure due to a maturity default at June 30, 2022. At this time, we have no loans on deferral as a result of the COVID-19 pandemic. As has been in the past, construction lending for affordable housing units in high demand high absorption areas continues to be our focus.”

Highlights for the three months and six months ended June 30, 2022 are as follows:

  • Net income increased by $1.7 million and $2.0 million, or 44.9% and 29.7%, for the three months and six months ended June 30, 2022 compared to the same periods in the prior year.

  • Net interest income increased by $3.2 million and $4.7 million, or 30.5% and 22.8%, for the three months and six months ended June 30, 2022 compared to the same periods in 2021.

  • Asset quality metrics continued to remain strong with non-performing assets to total assets of 0.23% and 0.16% at June 30, 2022 and at December 31, 2021. Our allowance for loan losses totaled $5.5 million, or 0.53% of total loans at June 30, 2022 compared to $5.2 million, or 0.54% of total loans at December 31, 2021.

  • In accordance with the provisions of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), since March 2020, we granted pandemic-related loan payment deferrals to 196 loans totaling $190.9 million at the time payment deferral was requested. At June 30, 2022, we had no loans in deferral status.

Balance Sheet Summary
Total assets decreased by $3.5 million, or 0.3%, to $1.2 billion at June 30, 2022, from $1.2 billion at December 31, 2021. The decrease in assets was primarily due to decreases in cash and cash equivalents of $66.0 million and equity securities of $1.1 million, partially offset by increases in net loans of $50.6 million, securities held-to-maturity of $9.3 million, and premises and equipment of $2.3 million.

Cash and cash equivalents decreased by $66.0 million, or 43.4%, to $86.2 million at June 30, 2022 from $152.3 million at December 31, 2021. The decrease in cash and cash equivalents was a result of cash being deployed to fund an increase in net loans of $50.6 million, an increase in securities held-to-maturity of $9.3 million, an increase in property and equipment of $2.3 million due primarily to the purchase of property and equipment for a new branch office, and a reduction in FHLB advances of $7.0 million.

Equity securities decreased by $1.1 million, or 5.3%, to $18.9 million at June 30, 2022 from $19.9 million at December 31, 2021. The decrease in equity securities was primarily attributable to market depreciation of $1.1 million as market interest rates increased during the six months ended June 30, 2022.

Securities held-to-maturity increased by $9.3 million, or 52.1%, to $27.2 million at June 30, 2022 from $17.9 million at December 31, 2021 due primarily to the purchases of securities, partially offset by maturities and pay-downs.

Loans, net of the allowance for loan losses, increased by $50.6 million, or 5.2%, to $1.0 billion at June 30, 2022 from $968.1 million at December 31, 2021.   The increase in loans, net of the allowance for loan losses, was primarily due to loan originations of $307.4 million during the six months ended June 30, 2022, consisting primarily of $266.3 million in construction loans with respect to which approximately 32.1% of the funds were disbursed at loan closings, with the remaining funds to be disbursed over the terms of the construction loans.

Loan originations resulted in a net increase of $97.0 million in construction loans. The increase in our loan portfolio was partially offset by decreases in non-residential loans of $23.4 million, commercial and industrial loans of $15.8 million, mixed-use loans of $5.2 million, residential loans of $1.4 million, and multi-family loans of $560,000, coupled with normal pay-downs and principal reductions.

Premises and equipment increased by $2.3 million, or 9.7%, to $26.2 million at June 30, 2022 from $23.9 million at December 31, 2021 due to the acquisition of property and equipment for a new branch site located in Bloomingburg, New York.

Investments in restricted stock decreased by $331,000, or 21.1%, to $1.2 million at June 30, 2022 from $1.6 million at December 31, 2021 due primarily to a reduction in mandatory Federal Home Loan Bank stock in connection with the maturity/pay-off of $7.0 million in advances during the quarter ended June 30, 2022.

Accrued interest receivable increased by $949,000, or 22.2%, to $5.2 million at June 30, 2022 from $4.3 million at December 31, 2021 due to an increase in the loan portfolio.

Foreclosed real estate was $2.0 million at June 30, 2022 and December 31, 2021.

Right of use assets — operating decreased by $268,000, or 10.5%, to $2.3 million at June 30, 2022 from $2.6 million at December 31, 2021, primarily due to amortization.

Other assets increased by $793,000, or 16.9%, to $5.5 million at June 30, 2022 from $4.7 million at December 31, 2021 due to increases in suspense accounts of $406,000, tax assets of $326,000, and prepaid expenses of $84,000.

Total deposits increased by $1.4 million, or 0.2%, to $928.6 million at June 30, 2022 from $927.2 million at December 31, 2021. The increase was primarily due to an increase in non-interest bearing demand deposits of $31.6 million, or 9.6% and an increase in savings account balances of $24.5 million, or 13.3%. These increases were partially offset by a decrease in certificates of deposit of $48.7 million, or 16.6% and a decrease in NOW/money market accounts of $6.1 million, or 5.1%, from December 31, 2021 to June 30, 2022.

Federal Home Loan Bank advances decreased by $7.0 million, or 25.0%, to $21.0 million at June 30, 2022 from $28.0 million at December 31, 2021.

Advance payments by borrowers for taxes and insurance decreased by $147,000, or 7.8%, to $1.7 million at June 30, 2022 from $1.9 million at December 31, 2021 due primarily to the payment of taxes for borrowers, partially offset by the accumulation of tax payments from borrowers.

Lease liability – operating decreased by $260,000, or 10.0%, to $2.3 million at June 30, 2022 from $2.6 million at December 31, 2021, primarily due to amortization.

Accounts payable and accrued expenses decreased by $2.5 million, or 18.1%, to $11.1 million at June 30, 2022 from $13.5 million at December 31, 2021 due primarily to a decrease in suspense accounts for loan closings of $1.6 million and a decrease in accrued expenses of $1.2 million.

Stockholders’ equity increased by $4.9 million, or 2.0% to $256.3 million at June 30, 2022, from $251.4 million at December 31, 2021. The increase in stockholders’ equity was due to net income of $9.0 million for the six months ended June 30, 2022, a reduction of $504,000 in unearned employee stock ownership plan shares, and $41,000 in other comprehensive income, partially offset by dividends paid and declared of $4.7 million.

Net Interest Income
Net interest income totaled $13.5 million for the three months ended June 30, 2022, as compared to $10.4 million for the three months ended June 30, 2021. The increase in net interest income of $3.2 million, or 30.5%, was primarily due to an increase in interest income combined with a decrease in interest expense.

The increase in interest income is attributable to increases in loans, investment securities, equity securities, and interest-bearing deposits as we continued to deploy the proceeds raised in our July 2021 second-step conversion. The increase in interest income is also attributable to an increase in interest rates during the three months ended June 30, 2022.

The decrease in interest expense is attributable to a decrease in the balances and cost of funds on our certificates of deposits and on our borrowed money, partially offset by increases in the balances and cost of funds in our interest-bearing demand deposits and our savings and club accounts.

In this regard, total interest income increased by $3.2 million, or 27.1%, to $14.8 million for the three months ended June 30, 2022 from $11.7 million for the three months ended June 30, 2021 due to an increase in the average balance of interest earning assets of $257.0 million, or 27.8%, to $1.2 billion for the three months ended June 30, 2022 from $924.9 million for the three months ended June 30, 2021, partially offset by a decrease in the yield on interest earning assets by 3 basis points from 5.05% for the three months ended June 30, 2021 to 5.02% for the three months ended June 30, 2022.

Interest expense decreased by $2,000, or 0.2%, to $1.3 million for the three months ended June 30, 2022 from $1.3 million for the three months ended June 30, 2021 due to a decrease in the cost of interest bearing liabilities by 7 basis points from 0.91% for the three months ended June 30, 2021 to 0.84% for the three months ended June 30, 2022, partially offset by an increase in average interest bearing liabilities of $45.4 million, or 8.0%, to $613.6 million for the three months ended June 30, 2022 from $568.3 million for the three months ended June 30, 2021.

Net interest margin increased by 9 basis points, or 2.1%, during the three months ended June 30, 2022 to 4.58% compared to 4.49% during the three months ended June 30, 2021.

Net interest income totaled $25.5 million for the six months ended June 30, 2022, as compared to $20.7 million for the six months ended June 30, 2021. The increase in net interest income of $4.7 million, or 22.8%, was primarily due to an increase in interest income combined with a decrease in interest expense.

The increase in interest income is attributable to increases in loans, investment securities, equity securities, and interest-bearing deposits as we continued to deploy the proceeds raised in our July 2021 second-step conversion. The increase in interest income is also attributable to an increase in interest rates during the six months ended June 30, 2022.

The decrease in interest expense is attributable to a decrease in the balances and cost of funds on our certificates of deposits and on our borrowed money, partially offset by increases in the balances and cost of funds in our interest-bearing demand deposits and our savings and club accounts.

In this regard, interest income increased by $4.6 million, or 19.6%, to $28.1 million for the six months ended June 30, 2022 from $23.5 million for the six months ended June 30, 2021 due to an increase in the average balance of interest earning assets of $262.5 million, or 28.7%, to $1.2 billion for the six months ended June 30, 2022 from $913.5 million for the six months ended June 30, 2021, partially offset by a decrease in the yield on interest earning assets by 36 basis points from 5.14% for the six months ended June 30, 2021 to 4.78% for the six months ended June 30, 2022.

Interest expense decreased by $119,000, or 4.3%, to $2.6 million for the six months ended June 30, 2022 from $2.8 million for the six months ended June 30, 2021 due to a decrease in the cost of interest bearing liabilities by 12 basis points from 0.97% for the six months ended June 30, 2021 to 0.85% for the six months ended June 30, 2022, partially offset by an increase in average interest bearing liabilities of $52.6 million, or 9.2%, to $624.4 million for the six months ended June 30, 2022 from $571.8 million for the six months ended June 30, 2021.

Net interest margin decreased by 21 basis points, or 4.6%, during the six months ended June 30, 2022 to 4.33% compared to 4.54% during the six months ended June 30, 2021.

Provision for Loan Losses
The Company recorded no loan loss provision for the three months ended June 30, 2022 and June 30, 2021. We charged-off $7,000 and $9,000 during the three months ended June 30, 2022 and June 30, 2021, respectively, against various unpaid overdrafts in our demand deposit accounts. We recorded recoveries of $146,000 and $1,000 during the three months ended June 30, 2022 and June 30, 2021, respectively.

The Company recorded no loan loss provision for the six months ended June 30, 2022 compared to a loan loss provision of $17,000 for the six months ended June 30, 2021. We charged-off $17,000 and $20,000 during the six months ended June 30, 2022 and June 30, 2021, respectively, against various unpaid overdrafts in our demand deposit accounts. We recorded recoveries of $242,000 and $9,000 during the six months ended June 30, 2022 and June 30, 2021, respectively. The recoveries of $242,000 during the six months ended June 30, 2022 comprised of recoveries of $146,000 regarding a previously charged-off multi-family property, $53,000 regarding a previously charged-off non-residential property, and $43,000 regarding a previously charged-off mixed-use property.

Non-Interest Income
Non-interest income for the three months ended June 30, 2022 was $536,000 compared to non-interest income of $778,000 for the three months ended June 30, 2021. The decrease in total non-interest income was primarily due to an unrealized loss of $430,000 on equity securities during the three months ended June 30, 2022 compared to an unrealized gain of $93,000 on equity securities during the three months ended June 30, 2021. The unrealized loss of $430,000 on equity securities was primarily due to a rising interest rate environment and the Federal Reserve’s interest rate increases during the June 30, 2022 quarter.

The decrease in total non-interest income was partially offset by an increase of $234,000 in other loan fees and service charges, an increase of $39,000 on gain from the sale of fixed assets, an increase of $10,000 in other non-interest income, an increase of $2,000 in bank-owned life insurance income, and a decrease of $4,000 in investment advisory fees.

Non-interest income for the six months ended June 30, 2022 was $594,000 compared to non-interest income of $1.2 million for the six months ended June 30, 2021. The decrease in total non-interest income was primarily due to an unrealized loss of $1.1 million on equity securities during the six months ended June 30, 2022 compared to an unrealized loss of $62,000 on equity securities during the six months ended June 30, 2021. The unrealized loss of $1.1 million on equity securities was primarily due to a rising interest rate environment and the Federal Reserve’s interest rate increases during the six months ended June 30, 2022.

The decrease in total non-interest income was partially offset by an increase of $303,000 in other loan fees and service charges, an increase of $39,000 on gain from the sale of fixed assets, an increase of $15,000 in investment advisory fees, an increase of $16,000 in other non-interest income, and an increase of $2,000 in bank-owned life insurance income.

Non-Interest Expense
Non-interest expense increased by $698,000, or 11.0%, to $7.0 million for the three months ended June 30, 2022 from $6.3 million for the three months ended June 30, 2021. The increase resulted primarily from increases of $305,000 in other operating expense, $142,000 in outside data processing expense, $101,000 in salaries and employee benefits, $90,000 in occupancy expense, $38,000 in equipment expense, and $27,000 in advertising expense, partially offset by a decrease of $5,000 in real estate owned expense.

Non-interest expense increased by $1.4 million, or 10.6%, to $14.2 million for the six months ended June 30, 2022 from $12.9 million for the six months ended June 30, 2021. The increase resulted primarily from increases of $759,000 in other operating expense, $272,000 in salaries and employee benefits, $121,000 in occupancy expense, $91,000 in outside data processing expense, $78,000 in equipment expense, and $58,000 in advertising expense, partially offset by a decrease of $16,000 in real estate owned expense.

Income Taxes
We recorded income tax expense of $1.7 million and $1.1 million for the three months ended June 30, 2022 and 2021, respectively. For the three months ended June 30, 2022, we had approximately $185,000 in tax exempt income, compared to approximately $174,000 in tax exempt income for the three months ended June 30, 2021. Our effective income tax rates were 23.7% and 23.2% for the three months ended June 30, 2022 and 2021, respectively.

We recorded income tax expense of $2.8 million and $2.1 million for the six months ended June 30, 2022 and 2021, respectively. For the six months ended June 30, 2022, we had approximately $370,000 in tax exempt income, compared to approximately $336,000 in tax exempt income for the six months ended June 30, 2021. Our effective income tax rates were 23.6% and 23.2% for the six months ended June 30, 2022 and 2021, respectively.

Asset Quality
Non-performing assets totaled $2.8 million at June 30, 2022 compared to $2.0 million at December 31, 2021. We had two non-performing non-residential loans secured by the same property to one borrower that are on non-accrual and in foreclosure due to a maturity default at June 30, 2022 compared to no non-performing loans at December 31, 2021. Our ratio of non-performing assets to total assets remained low at 0.23% at June 30, 2022 and at 0.16% at December 31, 2021.

Based on a review of the loans that were in the loan portfolio at June 30, 2022, management believes that the allowance for loan losses is maintained at a level that represents its best estimate of inherent losses in the loan portfolio that were both probable and reasonably estimable.

The Company’s allowance for loan losses totaled $5.5 million, or 0.53% of total loans as of June 30, 2022, compared to $5.2 million, or 0.54% of total loans as of December 31, 2021.

Capital
The Company’s total stockholder’s equity to assets was 20.98% as of June 30, 2022. At June 30, 2022, the Company had the ability to borrow $24.1 million from the Federal Home Loan Bank of New York.

The Bank’s capital position remains strong relative to current regulatory requirements and the Bank is considered a well-capitalized institution under the Prompt Corrective Action framework. As of June 30, 2022, the Bank had a tier 1 leverage capital ratio of 16.25% and a total risk-based capital ratio of 14.52%.

About NorthEast Community Bancorp
NorthEast Community Bancorp, headquartered at 325 Hamilton Avenue, White Plains, New York 10601, is the holding company for NorthEast Community Bank, which conducts business through its eleven branch offices located in Bronx, New York, Orange, and Rockland Counties in New York and Essex, Middlesex, and Norfolk Counties in Massachusetts and three loan production offices located in New City, New York, White Plains, New York, and Danvers, Massachusetts. For more information about NorthEast Community Bancorp and NorthEast Community Bank, please visit www.necb.com.

Forward Looking Statement
This press release contains certain forward-looking statements. Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as “believe,” “expect,” “anticipate,” “estimate,” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” Forward-looking statements, by their nature, are subject to risks and uncertainties. Certain factors that could cause actual results to differ materially from expected results include, but are not limited to, changes in market interest rates, regional and national economic conditions (including higher inflation and its impact on regional and national economic conditions), the effect of the COVID-19 pandemic (including its impact on NorthEast Community Bank’s business operations and credit quality, on our customers and their ability to repay their loan obligations and on general economic and financial market conditions), legislative and regulatory changes, monetary and fiscal policies of the United States government, including policies of the United States Treasury and the Federal Reserve Board, the quality and composition of the loan or investment portfolios, demand for loan products, deposit flows, competition, demand for financial services in NorthEast Community Bank’s market area, changes in the real estate market values in NorthEast Community Bank’s market area and changes in relevant accounting principles and guidelines. Additionally, other risks and uncertainties may be described in our annual and quarterly reports filed with the U.S. Securities and Exchange Commission (the “SEC”), which are available through the SEC’s website located at www.sec.gov. These risks and uncertainties should be considered in evaluating any forward-looking statements and undue reliance should not be placed on such statements. Except as required by applicable law or regulation, the Company does not undertake, and specifically disclaims any obligation, to release publicly the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of the statements or to reflect the occurrence of anticipated or unanticipated events.

CONTACT:

Kenneth A. Martinek

 

Chairman and Chief Executive Officer

 

 

PHONE:

(914) 684-2500

NORTHEAST COMMUNITY BANCORP, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Unaudited)

 

June 30,

 

December 31,

 

2022

 

2021

 

(In thousands, except share

 

and per share amounts)

ASSETS

 

 

 

 

 

Cash and amounts due from depository institutions

$

14,302

 

 

$

8,344

 

Interest-bearing deposits

 

71,925

 

 

 

143,925

 

Total Cash and cash equivalents

 

86,227

 

 

 

152,269

 

Certificates of deposit

 

100

 

 

 

100

 

Equity securities

 

18,879

 

 

 

19,943

 

Securities available-for-sale, at fair value

 

1

 

 

 

1

 

Securities held-to-maturity (fair value of $24,385 and $17,620, respectively)

 

27,189

 

 

 

17,880

 

Loans receivable

 

1,023,622

 

 

 

972,851

 

Deferred loan costs, net

 

527

 

 

 

484

 

Allowance for loan losses

 

(5,467

)

 

 

(5,242

)

Net loans

 

1,018,682

 

 

 

968,093

 

Premises and equipment, net

 

26,215

 

 

 

23,907

 

Investments in restricted stock, at cost

 

1,238

 

 

 

1,569

 

Bank owned life insurance

 

25,588

 

 

 

25,291

 

Accrued interest receivable

 

5,232

 

 

 

4,283

 

Goodwill

 

651

 

 

 

651

 

Real estate owned

 

1,996

 

 

 

1,996

 

Property held for investment

 

1,463

 

 

 

1,481

 

Right of Use Assets – Operating

 

2,296

 

 

 

2,564

 

Right of Use Assets – Financing

 

357

 

 

 

359

 

Other assets

 

5,476

 

 

 

4,683

 

Total assets

$

1,221,590

 

 

$

1,225,070

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

Liabilities:

 

 

 

 

 

Deposits:

 

 

 

 

 

Non-interest bearing

$

362,484

 

 

$

330,853

 

Interest bearing

 

566,116

 

 

 

596,311

 

Total deposits

 

928,600

 

 

 

927,164

 

Advance payments by borrowers for taxes and insurance

 

1,737

 

 

 

1,884

 

Federal Home Loan Bank advances

 

21,000

 

 

 

28,000

 

Lease Liability – Operating

 

2,344

 

 

 

2,604

 

Lease Liability – Financing

 

514

 

 

 

496

 

Accounts payable and accrued expenses

 

11,083

 

 

 

13,540

 

Total liabilities

 

965,278

 

 

 

973,688

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

Preferred stock, $0.01 par value; 25,000,000 shares authorized; none issued or outstanding

 

 

 

 

 

Common stock, $0.01 par value; 75,000,000 shares authorized; 16,377,936 shares issued; and 16,377,936 shares outstanding

$

164

 

 

$

164

 

Additional paid-in capital

 

145,404

 

 

 

145,335

 

Unearned Employee Stock Ownership Plan (“ESOP”) shares

 

(7,866

)

 

 

(8,301

)

Retained earnings

 

118,708

 

 

 

114,323

 

Accumulated other comprehensive loss

 

(98

)

 

 

(139

)

Total stockholders’ equity

 

256,312

 

 

 

251,382

 

Total liabilities and stockholders’ equity

$

1,221,590

 

 

$

1,225,070

 

NORTHEAST COMMUNITY BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2022

 

2021

 

2022

 

2021

 

(In thousands, except per share amounts)

INTEREST INCOME:

 

 

 

 

 

 

 

 

 

 

 

Loans

$

14,412

 

 

$

11,575

 

$

27,473

 

 

$

23,302

 

Interest-earning deposits

 

249

 

 

 

11

 

 

304

 

 

 

21

 

Securities

 

177

 

 

 

90

 

 

335

 

 

 

173

 

Total Interest Income

 

14,838

 

 

 

11,676

 

 

28,112

 

 

 

23,496

 

INTEREST EXPENSE:

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

1,160

 

 

 

1,113

 

 

2,337

 

 

 

2,395

 

Borrowings

 

127

 

 

 

176

 

 

288

 

 

 

350

 

Financing lease

 

9

 

 

 

9

 

 

19

 

 

 

18

 

Total Interest Expense

 

1,296

 

 

 

1,298

 

 

2,644

 

 

 

2,763

 

Net Interest Income

 

13,542

 

 

 

10,378

 

 

25,468

 

 

 

20,733

 

Provision for loan loss

 

 

 

 

 

 

 

 

 

17

 

Net Interest Income after Provision for Loan Losses

 

13,542

 

 

 

10,378

 

 

25,468

 

 

 

20,716

 

NON-INTEREST INCOME:

 

 

 

 

 

 

 

 

 

 

 

Other loan fees and service charges

 

627

 

 

 

393

 

 

1,018

 

 

 

715

 

Gain (loss) on disposition of equipment

 

46

 

 

 

7

 

 

46

 

 

 

7

 

Earnings on bank owned life insurance

 

150

 

 

 

148

 

 

297

 

 

 

295

 

Investment advisory fees

 

120

 

 

 

124

 

 

257

 

 

 

242

 

Unrealized loss on equity securities

 

(430

)

 

 

93

 

 

(1,064

)

 

 

(62

)

Other

 

23

 

 

 

13

 

 

40

 

 

 

24

 

Total Non-Interest Income

 

536

 

 

 

778

 

 

594

 

 

 

1,221

 

NON-INTEREST EXPENSES:

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

3,613

 

 

 

3,512

 

 

7,441

 

 

 

7,169

 

Occupancy expense

 

562

 

 

 

472

 

 

1,166

 

 

 

1,045

 

Equipment

 

277

 

 

 

239

 

 

566

 

 

 

488

 

Outside data processing

 

479

 

 

 

337

 

 

915

 

 

 

824

 

Advertising

 

51

 

 

 

24

 

 

105

 

 

 

47

 

Real estate owned expense

 

21

 

 

 

26

 

 

52

 

 

 

68

 

Other

 

2,004

 

 

 

1,699

 

 

3,982

 

 

 

3,223

 

Total Non-Interest Expenses

 

7,007

 

 

 

6,309

 

 

14,227

 

 

 

12,864

 

INCOME BEFORE PROVISION FOR INCOME TAXES

 

7,071

 

 

 

4,847

 

 

11,835

 

 

 

9,073

 

PROVISION FOR INCOME TAXES

 

1,678

 

 

 

1,126

 

 

2,797

 

 

 

2,107

 

NET INCOME

$

5,393

 

 

$

3,721

 

$

9,038

 

 

$

6,966

 

NORTHEAST COMMUNITY BANCORP, INC.
SELECTED CONSOLIDATED FINANCIAL DATA
(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2022

 

2021

 

2022

 

2021

 

(In thousands, except per share amounts)

 

(In thousands, except per share amounts)

Per share data:

 

 

 

 

 

 

 

 

 

 

 

Earnings per share - basic and diluted¹

$

0.35

 

 

$

0.23

 

 

$

0.58

 

 

$

0.43

 

Weighted average shares outstanding - basic and diluted¹

 

15,544

 

 

 

16,181

 

 

 

15,534

 

 

 

16,176

 

Performance ratios/data:

 

 

 

 

 

 

 

 

 

 

 

Return on average total assets

 

1.72

%

 

 

1.50

%

 

 

1.45

%

 

 

1.42

%

Return on average shareholders' equity

 

8.42

%

 

 

9.32

%

 

 

7.09

%

 

 

8.83

%

Net interest income

$

13,542

 

 

$

10,378

 

 

$

25,468

 

 

$

20,733

 

Net interest margin

 

4.58

%

 

 

4.49

%

 

 

4.33

%

 

 

4.54

%

Efficiency ratio

 

49.77

%

 

 

56.56

%

 

 

54.59

%

 

 

58.60

%

Net charge-off ratio

 

(0.01

)%

 

 

0.00

%

 

 

(0.02

)%

 

 

0.00

%

 

 

 

 

 

 

 

 

 

 

 

 

Loan portfolio composition:

 

 

 

 

 

 

June 30, 2022

 

December 31, 2021

One-to-four family

 

 

 

 

 

 

$

5,758

 

 

$

7,189

 

Multi-family

 

 

 

 

 

 

 

83,866

 

 

 

84,425

 

Mixed-use

 

 

 

 

 

 

 

23,495

 

 

 

28,744

 

Total residential real estate

 

 

 

 

 

 

 

113,119

 

 

 

120,358

 

Non-residential real estate

 

 

 

 

 

 

 

26,633

 

 

 

50,016

 

Construction

 

 

 

 

 

 

 

780,858

 

 

 

683,830

 

Commercial and industrial

 

 

 

 

 

 

 

102,594

 

 

 

118,378

 

Consumer

 

 

 

 

 

 

 

418

 

 

 

269

 

Gross loans

 

 

 

 

 

 

 

1,023,622

 

 

 

972,851

 

Deferred loan (fees) costs, net

 

 

 

 

 

 

 

527

 

 

 

484

 

Total loans

 

 

 

 

 

 

$

1,024,149

 

 

$

973,335

 

Asset quality data:

 

 

 

 

 

 

 

 

 

 

 

Loans past due over 90 days and still accruing

 

 

 

 

 

 

$

-

 

 

$

-

 

Non-accrual loans

 

 

 

 

 

 

 

769

 

 

 

-

 

OREO property

 

 

 

 

 

 

 

1,996

 

 

 

1,996

 

Total non-performing assets

 

 

 

 

 

 

$

2,765

 

 

$

1,996

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for loan losses to total loans

 

 

 

 

 

 

 

0.53

%

 

 

0.54

%

Allowance for loan losses to non-performing loans

 

 

 

 

 

 

 

710.92

%

 

 

NA

 

Non-performing loans to total loans

 

 

 

 

 

 

 

0.08

%

 

 

0.00

%

Non-performing assets to total assets

 

 

 

 

 

 

 

0.23

%

 

 

0.16

%

 

 

 

 

 

 

 

 

 

 

 

 

Bank's Regulatory Capital ratios:

 

 

 

 

 

 

 

 

 

 

 

Common equity tier 1 capital to risk-weighted assets

 

 

 

 

 

 

 

14.52

%

 

 

15.28

%

Total capital to risk-weighted assets

 

 

 

 

 

 

 

14.14

%

 

 

14.87

%

Tier 1 capital to risk-weighted assets

 

 

 

 

 

 

 

14.14

%

 

 

14.87

%

Tier 1 leverage ratio

 

 

 

 

 

 

 

16.25

%

 

 

16.79

%

¹Shares amounts related to periods prior to the July 12, 2021 closing of the conversion offering have been restated to give retroactive recognition to the 1.3400 exchange ratio applied in the conversion offering.

NORTHEAST COMMUNITY BANCORP, INC.
NET INTEREST MARGIN ANALYSIS
(Unaudited)

 

Three Months Ended June 30, 2022

 

Three Months Ended June 30, 2021

 

Average

 

Interest

 

Average

 

Average

 

Interest

 

Average

 

Balance

 

and dividend

 

Yield

 

Balance

 

and dividend

 

Yield

 

(In thousands, except yield/cost information)

 

(In thousands, except yield/cost information)

Loan receivable Gross

$

997,983

 

 

$

14,412

 

 

5.78

%

 

$

833,973

 

 

$

11,575

 

5.55

%

Securities (1)

 

43,880

 

 

 

177

 

 

1.61

%

 

 

21,513

 

 

 

90

 

1.67

%

Other interest-earning assets

 

139,978

 

 

 

249

 

 

0.71

%

 

 

69,368

 

 

 

11

 

0.06

%

Total interest-earning assets

 

1,181,841

 

 

 

14,838

 

 

5.02

%

 

 

924,854

 

 

 

11,676

 

5.05

%

Allowance for loan losses

 

(5,333

)

 

 

 

 

 

 

 

 

(5,103

)

 

 

 

 

 

Non-interest-earning assets

 

77,693

 

 

 

 

 

 

 

 

 

72,615

 

 

 

 

 

 

Total assets

$

1,254,201

 

 

 

 

 

 

 

 

$

992,366

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing demand deposit

$

115,097

 

 

$

190

 

 

0.66

%

 

$

114,675

 

 

$

164

 

0.57

%

Savings and club accounts

 

214,840

 

 

 

354

 

 

0.66

%

 

 

101,162

 

 

 

48

 

0.19

%

Certificates of deposit

 

262,703

 

 

 

616

 

 

0.94

%

 

 

324,420

 

 

 

901

 

1.11

%

Total interest-bearing deposits

 

592,640

 

 

 

1,160

 

 

0.78

%

 

 

540,257

 

 

 

1,113

 

0.82

%

Borrowed money

 

21,000

 

 

 

136

 

 

2.59

%

 

 

28,000

 

 

 

185

 

2.64

%

Total interest-bearing liabilities

 

613,640

 

 

 

1,296

 

 

0.84

%

 

 

568,257

 

 

 

1,298

 

0.91

%

Non-interest-bearing demand deposit

 

368,359

 

 

 

 

 

 

 

 

 

239,996

 

 

 

 

 

 

Other non-interest-bearing liabilities

 

16,108

 

 

 

 

 

 

 

 

 

24,429

 

 

 

 

 

 

Total liabilities

 

998,107

 

 

 

 

 

 

 

 

 

832,682

 

 

 

 

 

 

Equity

 

256,094

 

 

 

 

 

 

 

 

 

159,684

 

 

 

 

 

 

Total liabilities and equity

$

1,254,201

 

 

 

 

 

 

 

 

$

992,366

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income / interest spread

 

 

 

$

13,542

 

 

4.18

%

 

 

 

 

$

10,378

 

4.14

%

Net interest rate margin

 

 

 

 

 

 

 

4.58

%

 

 

 

 

 

 

 

4.49

%

Net interest earning assets

$

568,201

 

 

 

 

 

 

 

 

$

356,597

 

 

 

 

 

 

Average interest-earning assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

to interest-bearing liabilities

 

192.60

%

 

 

 

 

 

 

 

 

162.75

%

 

 

 

 

 

______________________

(1)   Includes Federal Home Loan Bank of New York stock.

NORTHEAST COMMUNITY BANCORP, INC.
NET INTEREST MARGIN ANALYSIS
(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2022

 

Six Months Ended June 30, 2021

 

Average

 

Interest

 

Average

 

Average

 

Interest

 

Average

 

Balance

 

and dividend

 

Yield

 

Balance

 

and dividend

 

Yield

 

(In thousands, except yield/cost information)

 

(In thousands, except yield/cost information)

Loan receivable Gross

$

993,879

 

 

$

27,473

 

 

5.53

%

 

$

834,219

 

 

$

23,302

 

5.59

%

Securities (1)

 

41,489

 

 

 

335

 

 

1.61

%

 

 

20,312

 

 

 

173

 

1.70

%

Other interest-earning assets

 

140,582

 

 

 

304

 

 

0.43

%

 

 

58,942

 

 

 

21

 

0.07

%

Total interest-earning assets

 

1,175,950

 

 

 

28,112

 

 

4.78

%

 

 

913,473

 

 

 

23,496

 

5.14

%

Allowance for loan losses

 

(5,308

)

 

 

 

 

 

 

 

 

(5,096

)

 

 

 

 

 

Non-interest-earning assets

 

76,927

 

 

 

 

 

 

 

 

 

70,157

 

 

 

 

 

 

Total assets

$

1,247,569

 

 

 

 

 

 

 

 

$

978,534

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing demand deposit

$

116,228

 

 

$

359

 

 

0.62

%

 

$

111,357

 

 

$

320

 

0.57

%

Savings and club accounts

 

209,080

 

 

 

681

 

 

0.65

%

 

 

101,893

 

 

 

127

 

0.25

%

Certificates of deposit

 

275,612

 

 

 

1,297

 

 

0.94

%

 

 

330,546

 

 

 

1,948

 

1.18

%

Total interest-bearing deposits

 

600,920

 

 

 

2,337

 

 

0.78

%

 

 

543,796

 

 

 

2,395

 

0.88

%

Borrowed money

 

23,514

 

 

 

307

 

 

2.61

%

 

 

28,000

 

 

 

368

 

2.63

%

Total interest-bearing liabilities

 

624,434

 

 

 

2,644

 

 

0.85

%

 

 

571,796

 

 

 

2,763

 

0.97

%

Non-interest-bearing demand deposit

 

352,689

 

 

 

 

 

 

 

 

 

229,854

 

 

 

 

 

 

Other non-interest-bearing liabilities

 

15,352

 

 

 

 

 

 

 

 

 

19,020

 

 

 

 

 

 

Total liabilities

 

992,475

 

 

 

 

 

 

 

 

 

820,670

 

 

 

 

 

 

Equity

 

255,094

 

 

 

 

 

 

 

 

 

157,864

 

 

 

 

 

 

Total liabilities and equity

$

1,247,569

 

 

 

 

 

 

 

 

$

978,534

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income / interest spread

 

 

 

$

25,468

 

 

3.93

%

 

 

 

 

$

20,733

 

4.18

%

Net interest rate margin

 

 

 

 

 

 

 

4.33

%

 

 

 

 

 

 

 

4.54

%

Net interest earning assets

$

551,516

 

 

 

 

 

 

 

 

$

341,677

 

 

 

 

 

 

Average interest-earning assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

to interest-bearing liabilities

 

188.32

%

 

 

 

 

 

 

 

 

159.76

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

______________________

(1)   Includes Federal Home Loan Bank of New York stock.