Attached files
Exhibit 99.1
CORNERSTONE FINANCIAL CORPORATION
REPORTS NINTH CONSECUTIVE QUARTER OF PROFITABILITY
Mount Laurel, NJ - Cornerstone Financial Corporation (CFIC.OB), the holding
company for Cornerstone Bank, reported today net income available to common
shareholders of $416 thousand, or $0.21 per diluted share for the third quarter
of 2011, as compared to net income of $446 thousand, or $0.23 per share, for the
same period in 2010. Net income for the quarter before preferred stock dividends
totaled $449 thousand, versus $479 thousand a year ago and $359 thousand for the
second quarter of 2011.
The change in net income before preferred stock dividends reflects an increase
of $256 thousand in net interest income, coupled with a $28 thousand decrease in
the provision for loan losses and a $29 thousand reduction in income tax
expense. These changes were offset by a decrease of $218 thousand in
non-interest income and an increase of $125 thousand in non-interest expense.
The change in non-interest income was primarily related to a reduction of $273
thousand in gain on sale of loans partially offset by a $44 thousand gain on
sale of investments. The increase in non-interest expense was primarily related
to increased salary, benefit and net occupancy costs required due to the
addition of key administrative and branch personnel needed to manage our growth,
coupled with the effect of operating expenses related to the Marlton office
which opened in November 2010.
For the nine-month period ended September 30, 2011, Cornerstone Financial
Corporation reported net income available to common shareholders of $817
thousand, or $0.42 per diluted share as compared to net income available to
common shareholders of $1.4 million, or $0.70 per diluted share, for the same
period in 2010. The change in net income reflects increases of $797 thousand in
net interest income and a $376 thousand decrease in income tax expense. These
changes were offset by an increase of $996 thousand in the provision for loan
losses, a decrease of $50 thousand in non-interest income and an increase of
$685 thousand in non-interest expense.
Total deposits at September 30, 2011 were $329.7 million, an increase of $27.5
million or 9.1% from December 31, 2010. The increase in deposits was
attributable to an increase of $42.3 million in interest bearing deposit
accounts which reflects migration of $11.9 million from non-interest bearing
deposit accounts and $2.9 million from certificates of deposit, as well as $27.5
million in new deposit funds.
Total assets at September 30, 2011 were $390.4 million, an increase of $36.4
million or 10.3% over December 31, 2010. This change was primarily due to
increases in cash equivalents of $ 37.7 million, investment securities available
for sale of $17.4 million and loans receivable net of $2.4 million, partially
offset by a decrease in investment securities held to maturity of $18.5 million
and a decrease in deferred tax asset of $2 million. Gross loans receivable at
September 30, 2011, totaled $244.3 million, an increase of $1.4 million or 0.6%
from December 31, 2010. This change was attributable to increases of $10.4
million in commercial loans, offset by decrease of $5.7 million in residential
real estate loans, $1.6 million in commercial real estate loans, $1.4 million in
construction loans and $260 thousand in consumer loans. At September 30, 2011
our total non-performing assets were $18.3 million or 4.68% of our total assets,
an increase of $6.7 million from non-performing assets of $11.6 million or 3.26%
of total assets at December 31, 2010.
Cornerstone's Chairman, President, and CEO George W. Matteo, Jr. commented
"Obviously we are pleased with our performance over the past quarter. The
general economy, however, remains weak so we remain only guardedly optimistic.
The weakened economy has had a negative effect on some of our customers and as a
community bank, we feel it is our duty to continue to work with those customers
to see them through to better days. On the other hand, even in a down economy we
see demand and opportunities for a community bank like ourselves."
Cornerstone Financial Corporation is a New Jersey based bank holding company
headquartered in Mount Laurel, New Jersey and is the holding company for
Cornerstone Bank ("the Bank"), a New Jersey state chartered commercial bank
headquartered in Moorestown, New Jersey. The Bank commenced operations on
October 4, 1999, and conducts business from its main office in Moorestown and
from six additional branch offices located in Medford, Burlington, Cherry Hill,
Voorhees, Mount Laurel, and Marlton, New Jersey.
Set forth below is selected financial information concerning Cornerstone
Financial Corporation:
Selected Balance Sheet Data
September December
(In thousands) 30, 2011 31, 2010
--------------- --------------
Investments held to maturity $ 21,929 $ 40,435
Investments available for sale 62,081 44,635
Loans receivable 244,286 242,856
Allowance for loan losses 2,848 3,826
Total assets 390,423 354,017
Deposits 329,743 302,270
Advances from the Federal Home Loan Bank 25,000 25,000
Stockholders equity 21,042 17,748
SELECTED NON-PERFORMING ASSET DATA September December
30, 2011 31, 2010
(In thousands) --------------- --------------
Non-performing assets:
Loans past due 90 days or more and accruing
Commercial $ - $ 634
Construction 138 -
Consumer 243 244
--------------- --------------
Total loans past due 90 days or more and
accruing $ 381 $ 878
--------------- --------------
Non-accrual loans:
Commercial $ 4,311 $ 1,296
Commercial real estate 10,312 8,213
Residential real estate 964 -
Consumer 337 289
--------------- --------------
Total 15,924 9,798
Impaired loans 455 51
Restructured loans 694 -
Real estate owned 830 830
--------------- --------------
Total non-performing assets $ 18,284 $ 11,557
=============== ==============
September December
SELECTED CAPITAL RATIOS FOR THE BANK 30, 2011 31, 2010
--------------- --------------
Shareholders' equity to total assets 5.3% 5.6%
Leverage ratio 6.7% 6.9%
Risk-based capital ratios:
Tier 1 8.8% 8.9%
Total Capital 10.8% 11.2%
Nine Nine
months months
SELECTED ALLOWANCE FOR LOAN LOSS DATA ended ended
September September
30, 2011 30, 2010
(In thousands)
--------------- --------------
Balance at beginning of period $ 3,826 $ 3,432
Provision for loan losses 1,378 382
Charge-offs (net of recoveries) (2,356) (149)
--------------- --------------
Balance, end of period $ 2,848 $ 3,665
--------------- --------------
Three Three Nine Nine
months months months months
SELECTED INCOME STATEMENT DATA ended ended ended ended
September September September September
30, 2011 30, 2010 30, 2011 30, 2010
(In thousands except per share data) ---------- ----------- ------------ ------------
Interest income $ 4,254 $ 4,069 $ 12,677 $ 12,053
Interest expense 1,091 1,162 3,282 3,455
Net interest income 3,163 2,907 9,395 8,598
Provision for loan losses 207 235 1,378 382
Income before income taxes 731 790 1,480 2,414
Net income 449 479 917 1,475
Preferred stock dividends 33 33 100 99
Net income available to common 416 446 817 1376
shareholders
EARNINGS PER SHARE
Basic $ 0.21 $ 0.23 $ 0.42 $ 0.70
Diluted $ 0.21 $ 0.23 $ 0.42 $ 0.70
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic 1,954 1,954 1,954 1,954
Diluted 1,954 1,978 1,958 1,967
FORWARD-LOOKING STATEMENTS
Cornerstone Financial Corporation (the "Company") may from time to time
make written or oral "forward-looking statements," including statements
contained in the Company's filings with the Securities and Exchange Commission,
in its reports to shareholders and in other communications by the Company, which
are made in good faith by the Company pursuant to the "safe harbor" provisions
of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements involve risks and uncertainties, such
as statements of the Company's plans, objectives, expectations, estimates and
intentions that are subject to change based on various important factors (many
of which are beyond the Company's control). Forward-looking statements may be
identified by the use of words such as "expects," "subject," "believe," "will,"
"intends," "will be," or "would." The factors which could cause the Company's
financial performance to differ materially from the plans, objectives,
expectations, estimates and intentions expressed in such forward-looking
statements include those items listed under "Item 1A-Risk Factors" in our Annual
Report on Form 10-K for the year ended December 31, 2010 and the following
factors, among others: the strength of the United States economy in general and
the strength of the local economies in which the Company conducts operations;
the effects of, and changes in, trade, monetary and fiscal policies and laws,
including interest rate policies of the Board of Governors of the Federal
Reserve System ("Federal Reserve"); inflation; interest rates; market and
monetary fluctuations; the timely development of new products and services by
the Company and the perceived overall value of these products and services by
users, including the features, pricing and quality compared to competitors'
products and services; the success of the Company in gaining regulatory approval
of its products, services, dividends and of new branches, when required; the
impact of changes in financial services laws and regulations (including laws
concerning taxes, banking, securities and insurance); technological changes;
acquisitions; the ability to continue to effectively manage costs, including the
costs incurred in connection with the opening of new branches; changes in
consumer spending and saving habits; and the success of the Company at managing
the risks resulting from these factors
