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CRESTMONT FINANCIAL ANNOUNCES YEAR-END EARNINGS

 CRESTMONT FINANCIAL ANNOUNCES YEAR-END EARNINGS
 EDISON, N.J., April 28 /PRNewswire/ -- Crestmont Financial Corp.,


(NASDAQ-NMS: CRES) the holding company for Crestmont Federal Savings and Loan Association, announced today that in its fourth fiscal quarter ended March 31, 1992, net income was $600,000 or $0.15 per share compared with $213,000 or $0.06 per share in the corresponding period a year ago. For the fiscal year, earnings were $1,059,000 or $0.27 per share compared with $641,000 or $0.17 per share for fiscal 1991. The company's tangible book value at March 31, 1992 was $14.92 per share.
 At March 31, 1992, Crestmont Federal's tangible, core, and risk- based capital ratios were 4.84 percent, 4.84 percent, and 9.32 percent, respectively. This compares with 4.08 percent, 4.08 percent, and 8.16 percent at March 31, 1991. The ratio of stockholders' equity to total assets at March 31, 1992 was 4.97 percent.
 Net interest income for the quarter was $8.1 million compared with $6.6 million for the March quarter last year. For fiscal 1992, net interest income was $30.2 million compared with $28.3 million during fiscal 1991. The increase in net interest income for the quarter and the fiscal year is primarily due to reduced interest expense on deposits and borrowed funds compared with the previous March quarter and fiscal year resulting from the overall decline in market interest rates. This increase was partially offset by a decline in earning assets. The net interest margins for the three- and 12-month periods ended March 31, 1992 were 3.05 percent and 2.63 percent, respectively, compared with 2.13 percent and 2 percent for the same respective periods last year.
 During the quarter, provisions for loan and real estate owned losses were $500,000 and $1.0 million, respectively. These provisions were based on management's evaluation of the current and projected future risks inherent in the loan and real estate owned portfolios, as well as the known standards in the current regulatory environment. At March 31, 1992, nonperforming assets were $66.7 million compared with $67.2 million at Dec. 31, 1991 and $69.7 million at March 31, 1991. Nonperforming assets consist of $26.5 million of nonperforming loans, including $17.8 million of residential loans, and $40.2 million of real estate owned and in-substance foreclosures. Included in nonperforming assets are approximately $6.3 million under contract for sale. Not included in nonperforming assets is a troubled debt restructured loan with an outstanding balance of $12.6 million at March 31, 1992. During the course of the fiscal year, the borrower repaid principal totalling $1.5 million, and is current in its interest payments. While the trend with regard to nonperforming assets has remained relatively stable over the last eight quarters, continued weakness in the New Jersey real estate market could result in further declines in the carrying value of assets and an increase in nonperforming assets, which may result in increased levels of loan and real estate owned loss provisions in the future as conditions dictate. At March 31, 1992, the allowance for loan losses was $13.1 million and the allowance for real estate owned losses was $4.9 million compared with $12.6 million and $4.9 million, respectively, at Dec. 31, 1991, and $12.7 million and $1.8 million, respectively, at March 31, 1991.
 Loan servicing income declined from $919,000 for the quarter ended March 31, 1991 to $823,000 for the quarter ended March 31, 1992. The decline was primarily due to the reduction in the average amount of loans serviced for others from $1.7 billion for the quarter ended March 31, 1991 to $1.4 billion for the quarter ended March 31, 1992. Loan servicing income declined from $4.9 million in fiscal 1991 to $2.5 million in fiscal 1992 due to the previously discussed reduction in loans serviced for others, as well as the increased amortization of the servicing rights purchased and deferred premium on sale of loans caused by the decline in interest rates over the last year and the associated increase in projected prepayment estimates. Increased amortization of the mortgage servicing assets had a substantial impact in the quarter ended Dec. 31, 1991, when loan servicing income was a loss of $72,000. Because of the potential volatility of market interest rate movements and loan prepayment rates, the future trend in loan servicing income is difficult to project and could result in uneven quarterly results.
 Real estate owned operations, net was a loss of $1.0 million for the quarter ended March 31, 1992, compared with a loss of $152,000 for the same quarter in fiscal 1991. The increase in real estate owned operation expenses is due to the increase in real estate owned properties from $26.0 million at March 31, 1991 to $40.2 million at March 31, 1992.
 Total other expenses decreased 4.8 percent from $6.6 million for the quarter ended March 31, 1991 to $6.3 million for the quarter ended March 31, 1992. Total other expenses decreased 14.4 percent from $28.7 million in fiscal 1991 to $24.5 million in fiscal 1992. Management has continued to improve productivity and control costs during fiscal 1992, particularly with regard to the reduction of salary and employee benefits expense and occupancy expense which decreased 13.9 percent and 10.7 percent, respectively, from fiscal 1991. Average full time equivalent employees declined from 368 in fiscal 1991 to 283 in fiscal 1992, causing the decrease in salary and benefits, while the 50 percent reduction in space leased at the company's corporate headquarters in November 1991 generated the reduction in occupancy expense.
 Crestmont Federal Savings and Loan Association, a wholly owned subsidiary of Crestmont Financial Corp., with $1.1 billion in assets, has fifteen retail branch locations, and two loan production offices serving Essex, Middlesex, Monmouth, Morris, and Union counties in the state of New Jersey.
 CRESTMONT FINANCIAL CORP. AND SUBSIDIARY
 Consolidated Statements of Financial Condition
 (Dollars in thousands)
 3/31/92 3/31/91
 Assets
 Cash and due from banks $17,157 $10,721
 Investment securities 20,245 30,311
 Loans 662,044 772,447
 Less: Allowance for
 loan losses (13,056) (12,700)
 Net loans 648,988 759,747
 Mortgage loans held
 for sale 29,401 9,439
 Mortgage-backed
 securities, net 332,803 375,700
 Interest and dividends
 receivable 10,983 14,147
 Real estate owned, net 35,268 24,147
 Federal Home Loan Bank
 stock, at cost 15,164 14,665
 Servicing rights
 purchased and deferred
 premium on sale of loans 21,654 28,755
 Office properties and
 equipment, net 3,843 4,278
 Other assets 10,792 14,527
 Total assets 1,146,298 1,286,437
 Liabilities and
 Stockholders' Equity
 Deposits 829,371 832,883
 Securities sold under
 repurchase agreements 59,551 54,303
 Borrowed money 177,569 322,661
 Advance payments by
 borrowers for taxes
 and insurance 5,161 6,285
 Accrued expenses and
 other liabilities 17,640 14,410
 Total liabilities 1,089,292 1,230,542
 Stockholders' equity:
 Preferred stock, 10,000,000
 shares authorized; none issued -- --
 Common stock, par value $1.00,
 20,000,000 shares authorized;
 issued and outstanding,
 3,820,067 at March 31, 1992
 and 3,791,325 at March 31, 1991 3,820 3,791
 Paid-in capital 35,208 35,185
 Retained earnings 17,978 16,919
 Total stockholders' equity 57,006 55,895
 Total liabilities and
 stockholders' equity $1,146,298 $1,286,437
 CRESTMONT FINANCIAL CORP. AND SUBSIDIARY
 Consolidated Statements of Operations
 (Dollars in thousands, except per share amounts)
 Three months ended Twelve months ended
 March 31, March 31,
 1992 1991 1992 1991
 (Unaudited)
 Interest income:
 Interest on loans $16,486 $19,435 $71,482 $88,730
 Interest on mortgage-
 backed securities 7,974 9,500 34,088 43,564
 Interest and dividends
 on investments 738 1,315 3,880 5,438
 Total interest income 25,198 30,250 109,450 137,732
 Interest expense:
 Interest on deposits 11,891 14,727 53,701 66,204
 Interest on borrowed
 money 5,168 8,894 25,564 43,234
 Total interest expense 17,059 23,621 79,265 109,438
 Net interest income 8,139 6,629 30,185 28,294
 Provision for loan losses 500 946 1,784 4,461
 Net interest income after
 provision for loan losses 7,639 5,683 28,401 23,833
 Other income:
 Loan servicing income 823 919 2,450 4,878
 Deposit account fees
 and other income 696 1,353 2,894 3,895
 Real estate owned
 operations, net (997) (152) (1,746) (652)
 Provision for real estate
 owned losses (1,000) (142) (7,005) (2,709)
 Net gain on sales of
 mortgage loans 287 78 635 230
 Net gain (loss) on sales
 of securities 1 (23) 13 (2,047)
 Net gain on sales of
 servicing and other
 assets 77 (276) 2,414 3,571
 Total other income (113) 1,757 (345) 7,166
 Other expenses:
 Salaries and employee
 benefits 2,737 2,626 10,156 11,791
 Occupancy 1,853 1,995 7,644 8,562
 Advertising and promotion 53 147 263 507
 Federal insurance premiums 465 480 1,869 2,052
 Other 1,153 1,331 4,585 5,743
 Total other expenses 6,261 6,579 24,517 28,655
 Income before income
 tax expense 1,265 861 3,539 2,344
 Income tax expense 665 648 2,480 1,703
 Net income $600 $213 $1,059 $641
 Net income per share $0.15 $0.06 $0.27 $0.17
 Average number shares of
 common stock outstanding 3,918 3,880 3,904 3,820
 -0- 4/28/92
 /CONTACT: Eric P. Graap of Crestmont Financial, 908-287-3838, ext. 357/
 (CRES) CO: Crestmont Financial Corp. ST: New Jersey IN: FIN SU: ERN


TQ-OS -- NY098 -- 3925 04/28/92 14:56 EDT
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