Central Jersey Bancorp Reports a 19% Increase in First Quarter Earnings.LONG BRANCH, N.J. -- Central Jersey Bancorp (NASDAQ Capital Market Originally called the NASDAQ Small Cap Market, NASDAQ announced a name change to the NASDAQ Capital Market on September 27, 2005. [1] The NASDAQ Capital Market exists for securities of smaller, less-capitalized companies (small caps) that do not qualify for : CJBK), the parent company of Central Jersey Bank, N.A., reported net income of $725,000 for the three months ended March 31, 2006, as compared to net income of $610,000 for the same period in 2005, representing an increase of 19%. Basic and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of for the three months ended March 31, 2006 were both $0.09 as compared to $0.08 and $0.07, respectively, for the same period in 2005. Per share earnings have been adjusted in both periods to reflect the two-for-one stock split paid by Central Jersey Bancorp on July July: see month. 1, 2005. George S George, river, c.345 mi (560 km) long, rising in a lake on the Quebec-Labrador boundary, E Canada. It flows N through Indian Lake (125 sq mi/324 sq km) to Ungava Bay (an arm of Hudson Strait). . Callas Cal·las , Maria Originally Maria Anna Sophia Cecilia Kalogeropoulos. 1923-1977. American soprano known for her technical capacity and dramatic intensity. Among her notable operatic roles was the title role in Bellini's Norma. , Chairman of the Board of Directors, and James James, person in the Bible James, in the Gospel of St. Luke, kinsman of St. Jude. The original does not specify the relationship. James, rivers, United States James. S. Vaccaro, President and 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. , commented that, "We are pleased with the first quarter operating results for Central Jersey Bancorp. In spite of in opposition to all efforts of; in defiance or contempt of; notwithstanding. See also: Spite the significant pressure on net interest margin being experienced throughout the banking industry due to the current interest rate environment, earnings grew by 19% over the same prior year quarter. This was achieved largely due to commercial loan growth and recently realized operating efficiencies and cost economies." Results of Operations Net interest income was $4.3 million for the three months ended March 31, 2006 and 2005. Net interest income for the three months ended March 31, 2006 was comprised primarily of $5.6 million in interest on loans, $1.4 million in interest on securities, and $48,000 in other interest income, less interest expense on deposits of $2.1 million, interest expense on borrowed funds of $603,000 and interest expense on subordinated debentures subordinated debenture An unsecured bond with a claim to assets that is subordinate to all existing and future debt. Thus, in the event that the issuer encounters financial difficulties and must be liquidated, all other claims must be satisfied before of $99,000. Although the net interest income for the three months ended March 31, 2006 and 2005 was the same, the cost of interest-bearing Adj. 1. interest-bearing - of financial obligations on which interest is paid liabilities increased to an average cost of 3.03% for the three months ended March 31, 2006 from an average cost of 1.74% for the same period in 2005. For the three months ended March 31, 2006, the average yield on interest-earning assets was 6.16% as compared to 5.50% for the same period in 2005. The average net interest margin for the three months ended March 31, 2006 was 3.69% as compared to 4.08% for the same period in 2005. For the three months ended March 31, 2006, provision for loan losses was $51,000 as compared to $100,000 for the same prior year period. The provision for loan losses for the three months ended March 31, 2006 was commensurate com·men·su·rate adj. 1. Of the same size, extent, or duration as another. 2. Corresponding in size or degree; proportionate: a salary commensurate with my performance. 3. with the growth in the loan portfolio during this period. Non-interest income, which consists of service charges on deposit accounts, income from bank owned life insurance and fees from the gain on the sale of residential mortgages, was $480,000 for the three months ended March 31, 2006, as compared to $345,000 for the same period in 2005. The increase is due primarily to the gain on sale of residential mortgages which we began to offer in the latter part of 2005. Non-interest expense was $3.5 million for the three months ended March 31, 2006, as compared to $3.6 million for the same period in 2005. Non-interest expense generally includes costs associated with employee salaries and benefits, occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy expenses, data processing data processing or information processing, operations (e.g., handling, merging, sorting, and computing) performed upon data in accordance with strictly defined procedures, such as recording and summarizing the financial transactions of a fees, professional fees, core deposit intangible amortization, and other 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. . Financial Condition Central Jersey Bancorp's assets, at March 31, 2006, totaled $512.1 million, a decrease of $2.5 million, or 0.49%, from the December December: see month. 31, 2005 total of $514.6 million. The total assets figure of $512.1 million at March 31, 2006, is inclusive of inclusive of prep. Taking into consideration or account; including. $27.2 million in goodwill and $2.9 million in core deposit intangible. Cash and cash equivalents were $17.4 million at March 31, 2006, a decrease of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $3.8 million, or 17.9%, from the December 31, 2005 total of $21.2 million. The decrease is due primarily to timing of the cash flows of the bank's business activities. Investments totaled $130.5 million at March 31, 2006, a decrease of $3.2 million, or 2.4%, from the December 31, 2005 total of $133.7 million. This decrease was primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to principal pay downs on mortgage-backed securities Mortgage-backed securities (MSBs) Securities backed by a pool of mortgage loans. totaling $1.8 million and matured investment securities totaling $1.2 million. The proceeds received by Central Jersey Bancorp from these transactions were used to fund loan growth that occurred during the period. Loans held for sale totaled $1.9 million at March 31, 2006, as compared to $3.1 million at December 31, 2005. The decrease is due primarily to timing. Loans, net of the allowance for loan losses, closed the three months ended March 31, 2006 at $313.1 million, an increase of $5.9 million, or 1.9%, over the $307.2 million balance at December 31, 2005. The increase is due primarily to the 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 of commercial real estate loans during the three months ended March 31, 2006. Deposits at March 31, 2006 totaled $393.6 million, a decrease of $14.0 million, or 3.4%, from the December 31, 2005 total of $407.6 million. The decrease in deposit balances is reflective Refers to light hitting an opaque surface such as a printed page or mirror and bouncing back. See reflective media and reflective LCD. of normal seasonal flows and the general funding and liquidity challenges prevalent prevalent widespread occurrence. throughout the banking industry. Other borrowings were $49.1 million at March 31, 2006, as compared to $38.2 million at December 31, 2005, an increase of $10.9 million, or 28.5%. The increased borrowings were necessary to mitigate mit·i·gate v. To moderate in force or intensity. mit  i·ga tion n. the decrease
in deposits. These borrowings, which are short-term Short-termAny investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. in nature, were used to fund loan growth that occurred during the period. At March 31, 2006, book value per share and tangible Possessing a physical form that can be touched or felt. Tangible refers to that which can be seen, weighed, measured, or apprehended by the senses. A tangible object is something that is real and substantial. An automobile is an example of tangible Personal Property. book value per share were $8.01 and $4.16, respectively, as compared to $7.91 and $4.04, respectively, at December 31, 2005. Asset Quality The allowance for loan losses, which began the year at $3.17 million, or 1.02% of total loans, was $3.23 million at March 31, 2006, with the allowance for loan losses ratio remaining at 1.02% of total loans. Non-performing loans A non-performing loan is a loan that is in default or close to being in default. Many loans become non-performing after being in default for 3 months, but this can depend on the contract terms. totaled $46,000 at March 31, 2006, as compared to $79,000 at December 31, 2005. There were no loans charged-off during this period. About the Company Central Jersey Bancorp is the holding company and sole shareholder of Central Jersey Bank, N.A., the national banking entity resulting from the August 22, 2005 combination of Monmouth Monmouth, city, United States Monmouth, city (1990 pop. 9,489), seat of Warren co., W Ill.; inc. 1852. Located in a farm area, it is a trade center with a packing plant. Manufactures include pottery, farm tools, and feed. Monmouth College is in the city. Community Bank, N.A. and Allaire
See: Ticker symbol "CJBK." Central Jersey Bank, N.A. can be accessed through the internet at www.CJBNA.com. Forward Looking Statements Statements about the future expectations of Central Jersey Bancorp and its subsidiary, Central Jersey Bank, N.A., including future revenues and earnings, and all other statements in this press release other than historical facts are "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 Section 27A of the Securities Act of 1933, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. , and Section 21E of the Securities Exchange Act of 1934, as amended. Since these statements involve risks and uncertainties and are subject to change at any time, the companies' actual results could differ materially from expected results. Among these risks, trends and uncertainties are the effect of governmental regulation on Central Jersey Bank, N.A., the availability of working capital, the cost of personnel, and the competitive market in which Central Jersey Bank, N.A. competes.
CONSOLIDATED BALANCE SHEETS
MARCH 31, 2006 (UNAUDITED) AND DECEMBER 31, 2005
(dollars in thousands)
March 31, December 31,
2006 2005
----------- ---------
ASSETS (unaudited)
------
Cash and due from banks $17,439 $21,228
Federal funds sold -- --
Investment securities available for sale, at
market value 108,386 111,175
Investment securities held to maturity (market
value of $21,480 (unaudited) and $22,058 at
March 31, 2006 and December 31, 2005,
respectively) 22,097 22,567
Loans held for sale 1,916 3,127
Loans, net 313,063 307,168
Premises and equipment 5,909 6,006
Bank owned life insurance 3,368 3,338
Accrued interest receivable 2,631 2,636
Goodwill 27,229 27,229
Core deposit intangible 2,942 3,097
Other assets 7,083 6,992
----------- ---------
Total assets $512,063 $514,563
=========== =========
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
Deposits:
Non-interest bearing $87,860 $91,297
Interest bearing 305,692 316,257
----------- ---------
393,552 407,554
Other borrowings 49,096 38,191
Subordinated debentures 5,155 5,155
Accrued expenses and other liabilities 1,537 1,885
----------- ---------
Total liabilities 449,340 452,785
----------- ---------
Shareholders' equity:
Common stock, par value $0.01 per share.
Authorized 100,000,000 shares and issued
and outstanding 7,825,314 and 7,780,804
shares at March 31, 2006 and December 31,
2005, respectively. 78 78
Additional paid-in capital 60,368 60,003
Accumulated other comprehensive loss, net of
tax benefit (2,298) (2,153)
Retained earnings 4,575 3,850
----------- ---------
Total shareholders' equity 62,723 61,778
----------- ---------
Total liabilities and shareholders'
equity $512,063 $514,563
=========== =========
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2006 AND 2005
(dollars in thousands, except per share amounts)
Three months ended
March 31,
2006 2005
---------- ----------
(unaudited)
Interest and dividend income:
Interest and fees on loans $5,605 $4,152
Interest on securities available for sale 1,156 1,334
Interest on securities held to maturity 255 299
Interest on federal funds sold and due from
banks 48 30
---------- ----------
Total interest and dividend income 7,064 5,815
Interest expense:
Interest expense on deposits 2,097 1,269
Interest expense on subordinated debentures 99 74
Interest expense on other borrowings 603 136
---------- ----------
Total interest expense 2,799 1,496
---------- ----------
Net interest income 4,265 4,336
---------- ----------
Provision for loan losses: 51 100
---------- ----------
Net interest income after provision
for loan losses 4,214 4,236
---------- ----------
Other income:
Service charges on deposit accounts 339 315
Gain on sale of loans 110 --
Income on bank owned life insurance 29 30
Other service charges, commissions and fees 2 --
---------- ----------
Total other income 480 345
---------- ----------
Operating expenses:
Salaries and employee benefits 1,882 1,812
Net occupancy expenses 402 460
Data processing fees 203 264
Core deposit intangible amortization 155 172
Other operating expenses 899 918
---------- ----------
Total other expenses 3,541 3,626
---------- ----------
Income before provision for income taxes 1,153 955
Income taxes 428 345
---------- ----------
Net income $725 $610
========== ==========
Basic earnings per share $.09 $.08
========== ==========
Diluted earnings per share $.09 $.07
========== ==========
Average basic shares outstanding 7,809,811 7,726,268
========== ==========
Average diluted shares outstanding 8,391,900 8,458,946
========== ==========
Performance Ratios (unaudited)
(dollars in thousands)
------------------------------
Three Months Ended
March 31,
------------------
Ratio 2006 2005
----- ----- -----
Return on average assets 0.57% 0.51%
----- -----
Return on average tangible assets 0.61% 0.54%
----- -----
Return on average equity 4.70% 3.87%
----- -----
Return on average tangible equity 9.08% 8.13%
----- -----
Efficiency ratio 74.6% 77.5%
----- -----
Efficiency ratio (less core deposit intangible
amortization expense) 71.4% 73.8%
----- -----
Operating expense ratio 2.79% 3.01%
----- -----
Interest rate margin 3.69% 4.68%
----- -----
Ratio Calculations
------------------
Efficiency ratio:
Net interest income $4,265 $4,336
------ ------
Non-interest income 480 345
------ ------
Total revenue 4,745 4,681
------ ------
Non-interest expense $3,541 $3,626
------ ------
Ratio 74.6% 77.5%
------ ------
Efficiency ratio (less core deposit intangible
amortization expense):
Net interest income $4,265 $4,336
------ ------
Non-interest income 480 345
------ ------
Total revenue 4,745 4,681
------ ------
Non-interest expense 3,541 3,626
------ ------
Less: Core deposit amortization expense (155) (172)
------ ------
Non-interest expense (less core
deposit intangible amortization
expense) $3,386 $3,454
------ ------
Ratio 71.4% 73.8%
------ ------
Operating expense ratio:
Average assets $515,590 $481,822
-------- --------
Non-interest expense $3,541 $3,626
-------- --------
Ratio 2.79% 3.01%
-------- --------
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