Newmil Bancorp (NASDAQ:NMIL)
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The Board of Directors of NewMil Bancorp, Inc.
(NASDAQ/NM:NMIL) today announced results of its third quarter ended
September 30, 2005.
Diluted earnings per share increased 6% to $0.53 for the third
quarter ended September 30, 2005 from $0.50 for the third quarter
ended September 30, 2004.
Net income increased 2.8% to $2.2 million for the third quarter of
2005, compared with $2.1 million for the third quarter of 2004. These
results were attributable to increases in net interest income and a
negative provision, which was attributable to a recovery of a
previously charged-off loan. Net interest income increased primarily
due to an increase of $85.9 million in average earning assets, which
more than offset the 46 basis point decrease in the net interest
margin to 3.42%, compared with 3.88% at September 30, 2004.
Non-interest income decreased primarily due to lower gains on sale of
mortgage loans and lower commission and other deposit fees.
Non-interest expense was also lower in the nine month period ended
September 30, 2005, contributing to an efficiency ratio of 58% for
this period.
NewMil's assets increased to $857 million, up $112 million since
December 31, 2004. Total gross loans were $501 million at September
30, 2005, which increased $19 million, or 3.9%, since December 31,
2004. Credit quality remains strong, as evidenced by nonperforming
assets at 16 basis points of total assets at September 30, 2005.
Deposits increased $14 million to $601 million from $587 million at
December 31, 2004. At September 30, 2005, book value and tangible book
value per common share were $13.04 and $11.06, respectively, and tier
1 leverage and total risk-based capital ratios were 7.00% and 13.13%,
respectively. Return on average shareholder's equity was 16% for the
third quarter of 2005.
Francis J. Wiatr, NewMil's Chairman, President and CEO noted,
"Given the very difficult yield curve, we are pleased with our results
for the quarter. Our commercial lending business had an excellent
quarter and is substantially ahead of last year. Our lending programs
for small business are contributing to our growth, as activity in the
markets we serve remains healthy. Recently, the statistics released
from the U.S. Small Business Administration rank us second in the
state among all financial institutions for SBA 504 Loans for the SBA's
fiscal year ending September 30, 2005.
"Our competitive deposit product programs and excellent customer
service are continuing to attract many new business and personal
household accounts to the Bank. We have announced a new checking
program with identity theft features that we feel will further
strengthen our deposit base over time. We continue to build market
share as people appreciate the difference dealing with a community
bank who can deliver excellent and timely service.
"Over the next several months we feel the Fed will be nearing a
point where the increases in short term interest rates that have been
put in place will be enough to strike a balance between a growing
economy and an acceptable inflation level. As a result, quality
lending projects will likely proceed at a level to sustain a nice pace
of growth in our region.
"Our 20th branch office located in Shelton opened this past
quarter. We have been enthusiastically received by the community and
look forward to our expansion in that area.
"We remain optimistic about the overall growth potential in the
markets we serve, our participation in that growth, as well as the
strategic value of the Bank's franchise."
The Board of Directors also announced a quarterly dividend of 20
cents per common share, payable on November 15, 2005 to shareholders
of record on October 28, 2005.
NewMil Bancorp is the parent company of NewMil Bank, which has
served western Connecticut since 1858, and operates 20 full-service
banking offices.
Financial highlights are attached.
Statements in this news release concerning future results,
performance, expectations or intentions are forward-looking
statements. Actual results, performance or developments may differ
materially from forward-looking statements as a result of known or
unknown risks, uncertainties, and other factors, including those
identified from time to time in the Company's other filings with the
Securities and Exchange Commission, press releases and other
communications.
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NewMil Bancorp, Inc
SELECTED CONSOLIDATED FINANCIAL DATA
(in thousands except ratios and per share amounts)
(unaudited)
Three month Nine month
period ended period ended
September 30 September 30
STATEMENT OF INCOME 2005 2004 2005 2004
---- ---- ---- ----
Interest and dividend income $10,214 $8,881 $29,329 $26,409
Interest expense 3,835 2,390 9,839 7,012
Net interest income 6,379 6,491 19,490 19,397
Provision for loan losses (135) - (135) -
Non-interest income
Service fees on deposit
accounts 783 774 2,226 2,204
Gains on sales of mortgage
loans 13 38 104 146
Gains on sale of OREO - - 65 -
Other non-interest income 186 217 575 608
Total non-interest income 982 1,029 2,970 2,958
Non-interest expense
Compensation 2,442 2,368 7,195 7,253
Occupancy and equipment 791 726 2,361 2,197
Postage and telecommunication 144 156 422 444
Professional services,
collection & OREO 162 214 576 728
Printing and office supplies 135 92 352 306
Marketing 60 188 208 409
Service bureau EDP 97 87 287 279
Amortization of intangible
assets 37 49 110 147
Other 509 496 1,541 1,464
Total non-interest expense 4,377 4,376 13,052 13,227
Income before income taxes 3,119 3,144 9,543 9,128
Provision for income taxes 916 1,000 2,856 2,899
Net income $ 2,203 $2,144 $ 6,687 $ 6,229
Per common share
Diluted earnings $ 0.53 $ 0.50 $ 1.57 $ 1.44
Basic earnings 0.53 0.51 1.60 1.48
Cash dividends 0.20 0.17 0.60 0.49
Statistical data
Net interest margin, (fully tax
equivalent) 3.42% 3.88% 3.59% 3.93%
Efficiency ratio 59.46 58.19 58.11 59.17
Return on average assets 1.07 1.19 1.13 1.17
Return on average common
shareholders' equity 16.28 15.87 16.24 15.44
Weighted average equivalent
common shares outstanding,
diluted 4,192 4,321 4,262 4,330
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NewMil Bancorp, Inc.
SELECTED CONSOLIDATED FINANCIAL DATA
(in thousands except ratios and per share amounts)
Sept. 30, Sept. 30, December 31,
FINANCIAL CONDITION 2005 2004 2004
---- ---- ----
Unaudited Unaudited
Total assets $ 857,246 $ 730,410 $ 744,599
Loans, net 496,386 480,447 476,660
Allowance for loan losses 4,986 5,146 5,048
Securities 305,268 196,087 216,558
Cash and cash equivalents 20,522 21,430 18,493
Intangible assets 8,130 8,289 8,240
Deposits 601,103 586,047 587,010
Federal Home Loan Bank advances 162,751 63,070 75,654
Repurchase agreements 15,018 12,491 13,147
Long term debt 9,851 9,791 9,806
Shareholders' equity 53,722 55,049 55,613
Non-performing assets 1,401 1,181 922
Deposits
Demand (non-interest bearing) $ 75,586 $ 66,846 $ 66,895
NOW accounts 81,107 82,386 85,889
Money market 146,302 155,514 147,375
Savings and other 79,254 85,858 85,829
Certificates of deposit 218,854 195,443 201,022
Total deposits 601,103 586,047 587,010
Per common share
Book value $ 13.04 $ 13.11 $ 13.25
Tangible book value 11.06 11.13 11.29
Statistical data
Non-performing assets to total
assets 0.16% 0.16% 0.12%
Allowance for loan losses to total
loans 0.99 1.06 1.05
Allowance for loan losses to non-
performing loans 355.89 435.73 547.51
Common shareholders' equity to
assets 6.27 7.54 7.47
Tangible common shareholders'
equity to assets 5.32 6.40 6.36
Tier 1 leverage capital 7.00 7.70 7.79
Total risk-based capital 13.13 14.19 14.40
Common shares outstanding, net
(period end) 4,121 4,200 4,197
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