Central Bancorp Reports Third Quarter Earnings.Business Editors SOMERVILLE Somerville. 1 City (1990 pop. 76,210), Middlesex co., E Mass., a residential and industrial suburb of Boston, on the Mystic River; settled 1630, set off from Charlestown 1842, inc. as a city 1871. , Mass.--(BUSINESS WIRE)--Jan. 28, 2003 Central 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 : CEBK) today reported net income of $910,000, or $0.58 per 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. share, for the three months ended December December: see month. 31, 2002, compared to $949,000, or $0.57 per diluted share, for the corresponding quarter in the prior fiscal year. For the nine months ended December 31, 2002, net income increased 27.5% to $2,605,000, or $1.63 per diluted share, from $2,043,000, or $1.22 per diluted share, in the year earlier period. Exclusive of the impact of gains and losses on the sales and write-downs of investment securities, core earnings increased 49.5% during the first nine months of the current fiscal year compared to the same period in the prior year. The elimination of goodwill amortization in the current fiscal year, as required by a change in generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting , contributed $216,000 to the improved results in fiscal 2003. John D. Doherty
Please [ improve this article] or discuss the issue on the talk page. exceeded $50 million during the third quarter, a record level for the Bank. In addition, core deposits increased at an 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. rate of over 25% during the current quarter." Mr. Doherty added, " We have implemented our plan to create a mortgage banking capability to increase our non-interest income and better manage interest rate risk, which has contributed greatly to our growth in loan origination activity. While the sales of loans through December 31, 2002 were not significant, we have committed to sell to secondary mortgage market investors nearly $20 million of recently originated fixed-rate residential mortgages. The gains from these sales are expected to make a major contribution to growth in the core components of non-interest income in the fourth quarter of this fiscal year." The results for the quarter ended December 31, 2002, as compared to the same period in the prior year, were favorably fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. affected by an increase of $644,000 in net interest and dividend income. Such increase was largely due to a 59 basis point reduction in the overall cost of funds Cost of Funds The interest rate paid on an outstanding loan. Notes: Money isn't free! Cost of funds is the cost of borrowing money. See also: Interest Rate Cost of funds Interest rate associated with borrowing money. to 3.20%. The Company experienced an increase in its net interest margin to 3.73% in the most recently completed quarter from 3.63% in the same quarter of the prior fiscal year. With the sustained low interest rate environment currently in existence, and the related record level of loan refinancing Refinancing An extension and/or increase in amount of existing debt. activity, the Company believes it is likely to experience some compression in its net interest margin during the upcoming year. Loan quality continued to be outstanding with no loans delinquent delinquent 1) adj. not paid in full amount or on time. 2) n. short for an underage violator of the law as in juvenile delinquent. DELINQUENT, civil law. He who has been guilty of some crime, offence or failure of duty. in excess of 90 days at December 31, 2002. In addition, loan delinquencies continued to be minimal and the Company held no foreclosed assets at end of the current quarter. Central Bancorp, Inc., is the holding company for Central Bank, whose legal name is Central Co-operative Bank The Co-operative Bank is a co-operative bank trading in the United Kingdom with headquarters in Manchester, UK. It is an ethical bank, and refuses to invest in companies involved in the arms trade, genetic engineering, animal testing and use of sweated labour as stated in its , a Massachusetts-chartered co-operative bank operating eight full-service full-ser·vice adj. Associated with or offering complete service: full-service gasoline pumps; full-service banks. banking offices and one limited-service high school branch in suburban Boston. (See accompanying tables.) This earnings report may contain certain 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. , which are based on management's current expectations regarding economic, legislative and regulatory issues that may impact the Company's earnings in future periods. Factors that could cause future results to vary materially from current management expectations include, but are not limited to, general economic conditions, changes in interest rates, deposit flows, real estate values and competition; changes in accounting principles, policies or guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. ; changes in legislation or regulation; and other economic, competitive, governmental, regulatory and technological factors affecting the Company's operations, pricing, products and services.
Central Bancorp, Inc.
Consolidated Operating Data
(In Thousands, Except Per Share Data)
Quarter Ended Nine Months Ended
December 31, December 31,
2002 2001 2002 2001
(Unaudited) (Unaudited)
Net interest and
dividend income $4,352 $3,708 $12,748 $10,304
Net gain (loss) on
sales and write-downs
of investment securities 14 16 (196) 339
Other non-interest income 292 228 783 652
Non-interest expenses 3,200 2,467 9,222 8,086
Income before taxes 1,458 1,485 4,113 3,209
Provision for income
taxes 548 536 1,508 1,166
Net income $910 $949 $2,605 $2,043
Earnings per share:
Basic $0.58 $0.57 $1.64 $1.23
Diluted $0.58 $0.57 $1.63 $1.22
Weighted average number
of shares outstanding:
Basic 1,569 1,657 1,584 1,661
Diluted 1,580 1,672 1,600 1,676
Reconciliation of GAAP
earnings to core earnings:
Net income per GAAP $910 $949 $2,605 $2,043
Net (gain) loss on
sales and write-downs
of investment securites,
net of taxes (9) (11) 121 (220)
Core earnings $901 $938 $2,726 $1,823
Consolidated Balance Sheet Data
(In Thousands)
December 31, March 31,
2002 2002
(Unaudited)
Total assets $488,047 $468,219
Total loans (1) 399,988 371,707
Allowance for loan losses 3,276 3,292
Deposits 286,721 261,907
Borrowings 155,857 164,000
Stockholders' equity 41,090 38,954
(1) Includes loans held for sale of $19,494 at December 31, 2002.
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