Center Bancorp, Inc., Reports Record Fourth Quarter and Full Year 2001 - 20% Earnings Increase.Business Editors UNION, N.J.--(BUSINESS WIRE)--Jan. 24, 2002 Center Bancorp Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : CNBC CNBC Center for the Neural Basis of Cognition (artificial intelligence) CNBC Consumer News and Business Channel CNBC Congress of National Black Churches, Inc. ) parent company to Union Center National Bank of Union, New Jersey, today reported record earnings results for the fourth quarter and twelve months ended December December: see month. 31, 2001. John J. Davis See also John J. Davis (congressman) for the West Virginia politician. John J. Davis was a U.S. Army officer. From September 1, 1965 to October 19, 1966, Davis, then a Major General, served as the Assistant chief of Staff for Intelligence, Headquarters, Department , President & CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. noted that Center Bancorp's net income for the fourth quarter and for the full year increased 31.98% and 20.10 %, respectively. A continued widening of net interest margins and double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. gains in non-interest fee revenue growth were the primary drivers for the positive quarterly and twelve-month performance of the Corporation. Net income for the fourth quarter of 2001 amounted to $1,761,000 or $.44 per share fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. , an increase of 31.9 % over the $1,335,000 or $.34 per share fully diluted earned for the comparable fourth quarter of the previous year. For the twelve months ended December 31, 2001, net income increased 20.1% to $6,011,000 or $1.51 per fully diluted share, as compared to $5,005,000 or $1.26 per fully diluted share earned for the twelve months ended December 31, 2000. Strong interest-earning asset growth in both the loan and the investment security portfolios offset the effects of net interest margin pressure, with loans increasing $12.3 million, (up 6.17% percent over the prior year) and the investment securities portfolio increasing $87.0 million, (up 26.3% over the prior year). The increase in loan growth has been fueled by strong demand for commercial and residential mortgage loans. A robust commercial real estate and residential housing market prevailed throughout the year in New Jersey, despite the National economic downturn Downturn The transition point between a rising, expanding economy to a falling, contracting one. downturn A decline in security prices or economic activity following a period of rising or stable prices or activity. . Mr. Davis cited and attributed the expansion activity of the Corporation, into desirable markets such as Summit, Madison Madison, cities, United States Madison. 1 City (1990 pop. 12,006), seat of Jefferson co., SE Ind., on the Ohio River; settled c.1806, inc. 1838. It is a port of entry and a tobacco marketing center. and Morristown, New Jersey Morristown is a town in Morris County, New Jersey, United States. As of the United States 2000 Census, the town population was 18,544. Its estimated population in 2004 was 18,842. It is the county seat of Morris CountyGR6. , as a key reason for the increased loan demand. The increased size of the securities portfolio largely reflects the Corporation's leverage strategies. This was reflected in the addition of approximately $71.5 million in mortgage-backed securities Mortgage-backed securities (MSBs) Securities backed by a pool of mortgage loans. to the balance sheet during the fourth quarter in a recently initiated leverage program. While asset quality continues to remain high, during the fourth quarter, additional provisions of approximately $142,000 as compared with $110,000 in the fourth quarter of 2000 were made to the provision for loan losses, to maintain adequate loan loss a provision of reserves in relationship with loan portfolio growth. In 2001, the allowance was strengthened by a provision of $656,000. Non-interest bearing core deposits, a low-cost source of funding, continue to remain a key-funding source. At December 31, 2001, this source of funding amounted to $103.5 million or 16.4% of total funding sources and 20.8% of total deposits. For the twelve months average-earning assets grew $66.6 million or 13.3% and, interest-bearing liabilities increased on average $59.8 million. The net interest margin (net interest income as a percentage of earning-assets) increased 16 basis points during the fourth quarter to 4.04% from 3.88% recorded in the 2000 fourth quarter. This was driven by the 138 basis point reduction achieved in the cost on the volume of interest-bearing liabilities, which was sufficient to offset the decline of 92 basis points on interest-earning assets. Net interest margins, while increasing for the twelve months ended December 31, 2001, continued to come under pressure from the continued decline in interest rates. The Federal Reserve interest rate reductions have dictated dic·tate v. dic·tat·ed, dic·tat·ing, dic·tates v.tr. 1. To say or read aloud to be recorded or written by another: dictate a letter. 2. a. performance throughout the 4th quarter, as well as, for the year 2001. Due to the lower interest rate environment, the margin expanded in both the fourth quarter and for the twelve months ended December 31, 2001, as compared with the comparable twelve-month periods in 2000 Successful non-interest revenue generation continued to improve during the fourth quarter, and continues to increase as a percentage of total revenue. The increase in revenue for both periods was fueled by increased customer activity resulting in increased ATM and debit card debit card, card that allows the cost of goods or services that are purchased to be deducted directly from the purchaser's checking account. They can also be used at automated teller machines for withdrawing cash from the user's checking account. fees, coupled with increased other income attributable to an increase in the cash surrender value The amount of money that an insurance company pays the insured upon cancellation of a life insurance policy before death and which is a specific figure assigned to the policy at that particular time, reduced by a charge for administrative expenses. of bank owned life insurance. Non-interest income increased $218,000 or 51.1% for the fourth quarter of 2001. For the year 2001, total fee revenue, exclusive of gains in securities sold of $181,000, increased 34.8% or $596,000 as compared to the comparable twelve-month period in 2000. The Corporation intends to expand its ATM network in 2002, which should increase ATM fees in 2002. The Corporation also continues to see additional fee income opportunities in aggressively marketing the Bank's PC Banking service, Electronic Fund Transfer services, debit cards, lockbox Lockbox A collection and processing service provided to firms by banks, which collect payments from a dedicated postal box to which the firm directs its customers to send payment to. and merchant processing services. Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. remained in line for the quarter, rising 8.8 % sequentially from the prior quarter and 14.0% for the year. The efficiency ratio (operating expenses as a percentage of revenue) amounted to 59.87%, unchanged from 3rd quarter 2001, a level that is improved over historical performance and reflects favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. with peer group levels. Operating expenses were up with increased salary, benefits, and bank premise and occupancy expense accounting for most of the increase. Total assets at December 31, 2001, were $689.6 million, an increase of 21.1% from assets of $569.6 million at December 31, 2000. Annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. returns on average assets for the fourth quarter and twelve months ended December 31, 2001 were 1.07% and .99% compared to .96% and .94% for the 2000 periods, respectively. Total stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. increased 13.05% over 2000 to $44.3 million, and represented 6.42% of total assets at year-end. Book value per common share Book Value Per Common Share A measure used by owners of common shares in a firm to determine the level of safety associated with each individual share after all debts are paid accordingly. Formula: was $11.17 as compared with $10.02 a year ago. Tangible book value per common share increased to $10.65 from $9.40 a year ago. Annualized return on average stockholders' equity for the fourth quarter and twelve months ended December 31, 2001 were 15.7% and 14.1% compared to 14.2% and 13.4% for the 2000 periods, respectively. On December 11, 2001, the Corporation completed an issuance of $10.0 million in floating rate Capital Trust Preferred Securities, through a pooled offering with First Tennessee This article or section has multiple issues: * Its neutrality is disputed. * It reads like an advertisement and needs to be rewritten in a neutral point of view. * It may require general cleanup to meet Wikipedia's quality standards. Capital Markets. The securities are included as a component of Tier I leverage capital for regulatory capital purposes. The Tier I leverage capital ratio subsequently increased to 7.77 percent of total assets at December 31, 2001. Deposit growth was also strong for the quarter and year, up 8.43% and 5.43 % respectively on average. The growth in average deposits was in core interest-bearing accounts, premium savings and robust growth in demand deposits. Our entry into Morris County several years ago with the opening of our Madison and Morristown offices has proven to be an important step in our expansion. At December 31, 2001 total deposits for the Corporation were $497.8 million. Center Bancorp Inc., through its wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. , Union Center National Bank, Union, New Jersey, operates twelve-banking locations. Banking centers are located in Union Township There are many townships named Union Township in the United States: Michigan
Union Center National Bank is the largest commercial bank headquartered in Union County, chartered in 1923, and is a full service banking company. For further information regarding Center Bancorp Inc., call 800/862-3683.or visit our web site at http://www.centerbancorp.com. All non-historical statements in this press release constitute forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Such statements include expressions about management's confidence and strategies and management's expectations about new and existing programs and products, relationships, opportunities, technology and market conditions. These statements may use such forward-looking terminology as "expect", "look", "believe', "plan", "anticipate", "may", "will" or similar statements or variations of such terms or otherwise express views concerning trends and the future. Such forward-looking statements involve certain risks and uncertainties. These include, but are not limited to, the direction of interest rates, continued levels of loan quality and origination Origination The process through which a mortgage lender creates a mortgage secured by some amount of the mortgagor's real property. Notes: Also known as loan origination, everyone must go through the origination process when securing a mortgage for a piece of real volume, continued relationships with major customers including sources for loans, as well as the effects of economic conditions and legal and regulatory barriers and structure, including those relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the deregulation Deregulation The reduction or elimination of government power in a particular industry, usually enacted to create more competition within the industry. Notes: Traditional areas that have been deregulated are the telephone and airline industries. of the financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. industry. Actual results may differ materially from such forward-looking statements. Center Bancorp, Inc. assumes no obligation for updating any such forward-looking statement at any time.
CENTER BANCORP, INC.
FINANCIAL HIGHLIGHTS (UNAUDITED)
For the Three Months Ended For the Twelve Months Ended
December 31, December 31,
------------------------- -------------------------
2001 2000 2001 2000
(Dollars in
thousands
except per
share data)
----------------------------------------------------------------------
Earnings
Net Interest
Income $ 6,117 $ 4,988 $ 22,362 $ 19,472
Provision for
Loan Losses 142 110 656 363
Other Income 645 427 2,307 1,711
Gain/(Loss) on
Securities
Sold 1 (13) 181 (78)
Other Expenses 4,092 3,279 15,216 13,347
Net Income 1,762 1,335 6,011 5,005
Cash Dividend
Declared $ 594 $ 559 $ 2,338 $ 2,265
----------------------------------------------------------------------
Per Share Data
Net Income
Basic $ 0.45 $ 0.34 $ 1.53 $ 1.26
Diluted 0.44 0.34 1.51 1.26
Cash Dividends
Paid 0.15 0.14 0.59 0.58
Book Value 11.17 10.02 11.17 10.02
Tangible Book
Value $ 10.65 $ 9.40 $ 10.65 $ 9.40
Shares
Outstanding 3,964,652 3,911,805 3,964,652 3,911,805
----------------------------------------------------------------------
At Month End:
Market Value Bid Ask Bid Ask
------------ ------------
Per common
share $18.95 19.00 $20.00 20.24
----------------------------------------------------------------------
Financial
Ratios
Return on
average
assets 1.07% 0.96% 0.99% 0.94%
----------------------------------------------------------------------
Return on
average
stockholders'
equity 15.69% 14.23% 14.08% 13.43%
----------------------------------------------------------------------
Return on
tangible
average
stockholders'
equity 16.48% 15.23% 14.86% 14.43%
Cash dividend
declared as
a percent of
net income 33.73% 41.87% 38.90% 45.25%
----------------------------------------------------------------------
Balance Sheet
Data At
December 31:
Assets $ 689,603 $ 569,553
Deposits 497,833 425,296
Investment
Securities 417,274 330,267
Loans 211,236 198,949
Federal Home
Loan Bank
advances 60,000 50,000
Borrowings and
Overnight
Repurchase
Agreements 142,296 101,262
Stockholders'
Equity $ 44,296 $ 39,182
----------------------------------------------------------------------
Capital Ratios
Stockholders'
equity as a
percent of
total assets 6.42% 6.88%
Tier I
Leverage
Ratio 7.77% 6.60%
----------------------------------------------------------------------
All share and per share amounts have been restated to reflect the
5% stock dividend paid June 1, 2001.
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