Cooperative Bankshares, Inc. Reports First Quarter Earnings.WILMINGTON, N.C. -- Cooperative Bankshares, 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 : COOP) (the "Company"), the parent company of Cooperative Bank Cooperative bank may refer to:
Property owned by a lender - usually a bank - after an unsuccessful sale at a foreclosure auction. This is common because most of the properties up for sale at these auctions are worth less than the total amount owed to the bank: the minimum bid in most , and a gain on the sale of a building recognized in the first quarter of 2007. The decrease in net interest income was primarily caused by a 62 basis point reduction in the interest rate spread from 3.10% at March 31, 2007 to 2.48% at March 31, 2008. This decrease is primarily attributable to action taken by the Federal Reserve to reduce interest rates by 200 basis points during the first quarter of 2008 and 300 basis points since September 18, 2007. As a result of these rate reductions, the Bank's loan portfolio has repriced faster than deposits, causing a decline in net interest income. As the interest rate environment becomes more stable or if interest rates rise, the Bank believes that its interest rate spread would increase. The provision for loan losses increased to $855,000 for the quarter ended March 31, 2008 compared to $300,000 for the quarter ended March 31, 2007. This increase in the provision for loan losses was primarily the result of an increase in valuation allowances for the recorded investment in nonperforming loans and, to a lesser extent, an increase in loan growth and delinquencies at March 31, 2008 compared to March 31, 2007. At March 31, 2008 and 2007, the recorded investment in nonperforming loans was $8.8 million and $1.2 million, respectively, with corresponding valuation allowances of $706,000 and $133,000, respectively. The Bank incurred additional expenses during the quarter ended March 31, 2008 related to foreclosed real estate owned. During the three months ended March 31, 2008, net expenses related to foreclosed real estate owned totaled $215,000 compared to net income related to foreclosed real estate owned of $8,000 for the same period last year. The majority of foreclosed real estate expenses for the three-month period ended March 31, 2008 is related to a valuation write down of $165,000 on one property. Also, during the quarter ended March 31, 2007, the Company recognized a $275,000 gain on the sale of a branch office that was relocated in Morehead City. "As a result of the slowdown in the housing market and the general softening of the economy, we have seen an increase in nonperforming assets Nonperforming asset An asset that is not effectively producing income, such as an overdue loan. nonperforming asset An asset that produces no income. . Our management team's assessment of our investment in nonperforming loans was such that we felt an increase to the provision for loan losses was prudent and justified," said Frederick Willetts, III, the Company's Chairman, President, and Chief Executive Officer. Total assets increased to $958.2 million at March 31, 2008 compared to $926.8 million at December 31, 2007. Asset growth was primarily the result of continued loan growth during the first quarter of 2008, which was funded by deposit growth and increased borrowings. Loans increased to $844.1 million at March 31, 2008 compared to $820.1 million at December 31, 2007. For the three-month period ended March 31, 2008, the bulk of the increase in the loan portfolio occurred in one-to-four family loans, which grew $18.0 million, and construction and land development loans, which grew $11.7 million. Deposits and borrowings at March 31, 2008 increased to $728.6 million and $158.3 million, respectively, from $714.9 and $141.9 million, respectively, at December 31, 2007. Loan and deposit growth was primarily attributable to the markets in which the Bank conducts its business and the Bank's improved branch network. Loan growth was also affected by the Bank's continued emphasis on increasing overall loan production. The Company's nonperforming assets, which consist of loans ninety days or more delinquent, non-accrual loans, and foreclosed real estate owned, increased to $13.3 million at March 31, 2008 compared to $11.6 million at December 31, 2007. The average balance of nonperforming loans at March 31, 2008 was $274,000 compared to $235,000 at December 31, 2007. Also, at March 31, 2008, foreclosed real estate owned consisted of twelve properties with an average value of $379,000 compared to thirteen properties with an average value of $456,000 at December 31, 2007. All foreclosed real estate owned has been appraised and is recorded at the lower of the loan balance or the estimated fair value of the property less estimated costs to sell. At March 31, 2008, 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. was $64.8 million, or $9.85 per share, and represented 6.77% of assets, compared to $65.2 million, or $9.94 per share, representing 7.03% of assets at December 31, 2007. Stockholders' equity for the quarter ended March 31, 2008 was affected by the adoption of EITF EITF Emerging Issues Task Force EITF Edinburgh International Television Festival EITF Europe International Taekwon-Do Federation 06-4 on January 1, 2008. The adoption of EITF 06-4 resulted in an adjustment to the carrying value Carrying Value Also know as "book value," it is a company's total assets minus intangible assets and liabilities, such as debt. Notes: This is different than market value, as it can be higher or lower depending on the circumstances. of liabilities with an offsetting adjustment to the opening balance of retained earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. of $1.0 million, as discussed in the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended December 31, 2007. Chartered in 1898, Cooperative Bank provides a full range of 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. through twenty three offices in Eastern North Carolina Eastern North Carolina or (often abbreviated as ENC) is the region of North Carolina which includes the eastern third of North Carolina. It includes the Outer and Inner banks, thus it is often known geographically as the state's coastal region. and two offices in South Carolina South Carolina, state of the SE United States. It is bordered by North Carolina (N), the Atlantic Ocean (SE), and Georgia (SW). Facts and Figures Area, 31,055 sq mi (80,432 sq km). Pop. (2000) 4,012,012, a 15. . The Bank's subsidiary, Lumina Mortgage, Inc., is a mortgage banking firm, originating and selling residential mortgage loans through three offices in North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. . Statements in this news release that are not 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. as defined in 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 forward-looking statements, which contain words such as "expects," "intends," "believes" or words of similar import, are subject to numerous risks and uncertainties disclosed from time to time in documents the Company files with the Securities and Exchange Commission (the "SEC"), which could cause actual results to differ materially from the results currently anticipated. Undue reliance should not be placed on such forward-looking statements. The Company has filed a Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. with the SEC containing additional financial information regarding the three-month period ended March 31, 2008. |
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