EX-99.1 2 ex99-1.htm EXHIBIT 99.1 ex99-1.htm
 
Exhibit 99.1
 
Sussex Bancorp
Contacts: Anthony Labozzetta, President/CEO
200 Munsonhurst Road
Candace Leatham, SVP/CFO
Franklin, NJ  07416
973-827-2914


 
SUSSEX BANCORP ANNOUNCES 154% INCREASE IN FIRST QUARTER 2010 EARNINGS
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FRANKLIN, NEW JERSEY – April 28, 2010– Sussex Bancorp (NASDAQ: “SBBX”) today announced its financial results for the first quarter ended March 31, 2010.

For the quarter ended March 31, 2010, the Company earned net income of $643 thousand, an increase of 154.2% from net income of $253 thousand for the first quarter of 2009.   Basic and diluted earnings per share were $0.20 in the first quarter of 2010 compared to $0.08 for the first quarter of 2009.  “We are encouraged by our first quarter results” said Anthony Labozzetta, Sussex's President and Chief Executive Officer.  “With the continued strengthening of our core earnings and strong capital, we believe that we are well positioned to execute our community bank strategy of delivering an extraordinary experience for our customers while assisting with their financial needs” added Mr. Labozzetta.

 The Company’s net interest income increased $855 thousand, to $4.0 million for the quarter ended March 31, 2010 from $3.1 million for the first quarter of 2009. This, in large part, is a product of management’s effort to reduce funding costs, which helped improve the Company’s net interest margin by 81 basis points to 3.84% in the first quarter of 2010 as compared to the same period in 2009.  The average rate paid on interest bearing liabilities declined 115 basis points to 1.57% in the first three months of 2010 compared to 2.72% in the same period one year earlier.

Excluding holding gains on trading securities, the Company’s non-interest income decreased $132 thousand, or 10.1%, to $1.2 million for the quarter ended March 31, 2010 from $1.3 million for the first quarter of 2009.  The decrease in non-interest income is attributable to lower insurance commissions and lower service charges on deposit accounts.

The Company’s non-interest expenses remained unchanged at $3.5 million for the quarters ended March 31, 2010 and 2009.  The Company incurred higher expenses for FDIC assessments and salary and benefits in the first quarter of 2010 as compared to the same period a year ago.  Offsetting the overall impact of these items was a decrease in foreclosed real estate expenses and other expense savings resulting from cost control initiatives implemented during 2009. Maintaining non-interest expenses at the first quarter 2009 level, coupled with the increase in net interest income, resulted in a 12.1% decrease in the Company’s efficiency ratio to 65.1% for the first three months of 2010 compared to the first quarter of 2009.

At March 31, 2010, non-performing assets, which include non-accrual loans and foreclosed real estate, increased $5.4 million, to $26.4 million compared to $21.0 million at December 31, 2009, as foreclosed real estate increased by $486 thousand and non-accrual loans increased $4.9 million.  As a result of this increase in non-performing assets, the ratio of non-performing assets to total assets increased to 5.59% at March 31, 2010 from 4.61% at December 31, 2009.  “Mr. Labozzetta noted that the increase in nonperforming assets reflects, among other things, management’s aggressive approach to identifying and resolving the Bank’s troubled assets.”

At March 31, 2010 the Company’s total assets were $471.8 million, an increase of $17.0 million, or 3.7%, compared to total assets of $454.8 million at December 31, 2009.  The Company’s total deposits increased $16.0 million, or 4.3%, to $388.1 million at March 31, 2010 from $372.1 million at December 31, 2009.  The growth in deposits was primarily in core deposits, as they increased $13.2 million and time deposits grew $2.8 million between the two periods.  The Company’s gross loans, net of unearned income decreased $3.2 million to $329.8 million at March 31, 2010 from $333.0 million at December 31, 2009.  At March 31, 2010, the leverage capital, tier 1 capital

 
 

 

to risk weighted assets and total capital to risk weighted assets ratios of Sussex Bank, the Company’s bank subsidiary, were 9.03%, 12.13% and 13.38%, respectively, all in excess of the 5%, 6% and 10% ratios required to be deemed “well capitalized” under regulatory requirements.

Sussex Bancorp is the holding company for Sussex Bank, which operates through its main office in Franklin, New Jersey and branch offices in Andover, Augusta, Newton, Montague, Sparta, Vernon and Wantage, New Jersey, Port Jervis and Warwick, New York and for the Tri-State Insurance Agency, Inc., a full service insurance agency located in Sussex County, New Jersey.

 
CONSOLIDATED BALANCE SHEETS
(Unaudited)

 (Dollars in thousands, except share data)
 
March 31, 2010
 
December 31, 2009
 
             
ASSETS
           
Cash and due from banks
  $ 15,694     $ 8,779  
Federal funds sold
    25,705       14,300  
   Cash and cash equivalents
    41,399       23,079  
                 
Interest bearing time deposits with other banks
    600       100  
Trading securities
    2,573       2,955  
Securities available for sale
    73,761       71,315  
Federal Home Loan Bank Stock, at cost
    2,045       2,045  
                 
Loans receivable, net of unearned income
    329,782       332,959  
   Less:  allowance for loan losses
    6,225       5,496  
        Net loans receivable
    323,557       327,463  
                 
Foreclosed real estate
    4,329       3,843  
Premises and equipment, net
    7,067       7,065  
Accrued interest receivable
    1,857       1,943  
Goodwill
    2,820       2,820  
Other assets
    11,753       12,213  
                 
Total Assets
  $ 471,761     $ 454,841  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY
               
Liabilities:
               
   Deposits:
               
      Non-interest bearing
  $ 37,812     $ 34,155  
      Interest bearing
    350,259       337,920  
   Total Deposits
    388,071       372,075  
                 
Borrowings
    33,075       33,090  
Accrued interest payable and other liabilities
    2,408       2,262  
Junior subordinated debentures
    12,887       12,887  
                 
Total Liabilities
    436,441       420,314  
                 
Total Stockholders' Equity
    35,320       34,527  
                 
Total Liabilities and Stockholders' Equity
  $ 471,761     $ 454,841  


 
 

 


SUSSEX BANCORP
 
CONSOLIDATED STATEMENTS OF INCOME
 
(Unaudited)
 
             
   
Three Months Ended March 31,
 
(Dollars in thousands)
 
2010
   
2009
 
             
INTEREST INCOME
           
   Loans receivable, including fees
  $ 4,680     $ 4,808  
   Securities:
               
      Taxable
    514       627  
      Tax-exempt
    263       273  
   Federal funds sold
    7       12  
   Interest bearing deposits
    2       7  
         Total Interest Income
    5,466       5,727  
                 
INTEREST EXPENSE
               
   Deposits
    1,104       2,169  
   Borrowings
    352       352  
   Junior subordinated debentures
    53       104  
        Total Interest Expense
    1,509       2,625  
                 
        Net Interest Income
    3,957       3,102  
PROVISION FOR LOAN LOSSES
    737       639  
        Net Interest Income after Provision for Loan Losses
    3,220       2,463  
                 
OTHER INCOME
               
   Service fees on deposit accounts
    334       367  
   ATM fees
    115       107  
   Insurance commissions and fees
    547       614  
   Investment brokerage fees
    60       47  
   Holding gains on trading securities
    11       35  
   Loss on sale of foreclosed real estate
    4       (1 )
   Other
    110       168  
      Total Other Income
    1,181       1,337  
                 
OTHER EXPENSES
               
   Salaries and employee benefits
    1,841       1,783  
   Occupancy, net
    347       352  
   Furniture, equipment and data processing
    299       340  
   Stationary and supplies
    44       45  
   Professional fees
    159       183  
   Advertising and promotion
    51       59  
   Insurance
    56       41  
   FDIC Assessment
    224       150  
   Postage and freight
    31       42  
   Amortization of intangible assets
    4       5  
   Write-down on foreclosed real estate
    29       -  
   Expenses related to foreclosed real estate
    69       183  
   Other
    382       365  
      Total Other Expenses
    3,536       3,548  
                 
       Income before Income Taxes
    865       252  
PROVISION (BENEFIT) FOR INCOME TAXES
    222       (1 )
      Net Income
  $ 643     $ 253  


 
 

 


SUSSEX BANCORP
COMPARATIVE AVERAGE BALANCES AND AVERAGE INTEREST RATES
(Unaudited)
                 

   
Three Months Ended March 31,
 
(Dollars in thousands)
 
2010
   
2009
 
   
Average
         
Average
   
Average
         
Average
 
Interest earning assets:
 
Balance
   
Interest (1)
   
Rate (2)
   
Balance
   
Interest (1)
   
Rate (2)
 
   Securities:
                                   
      Tax exempt (3)
  $ 26,817     $ 394       5.96 %   $ 26,709     $ 408       6.19 %
      Taxable
    48,949       514       4.26 %     56,817       627       4.48 %
   Total securities
    75,766       908       4.86 %     83,526       1,035       5.02 %
   Total loans receivable (4)
    330,709       4,680       5.74 %     322,535       4,808       6.05 %
   Other interest-earning assets
    25,656       9       0.14 %     26,676       19       0.29 %
      Total interest earning assets
    432,131     $ 5,597       5.25 %     432,737     $ 5,862       5.49 %
                                                 
Non-interest earning assets
    37,836                       34,491                  
Allowance for loan losses
    (5,808 )                     (6,000 )                
      Total Assets
  $ 464,159                     $ 461,228                  
                                                 
Interest bearing liabilities:
                                               
   Interest bearing deposits:
                                               
      NOW
  $ 61,623     $ 143       0.94 %   $ 57,897     $ 159       1.11 %
      Money market
    12,435       24       0.78 %     14,703       48       1.33 %
      Savings
    167,546       494       1.20 %     159,739       1,026       2.61 %
      Time
    103,096       443       1.74 %     112,901       936       3.36 %
   Total interest bearing deposits
    344,699       1,104       1.30 %     345,240       2,169       2.55 %
      Borrowed funds
    33,081       352       4.25 %     33,138       352       4.25 %
      Junior subordinated debentures
    12,887       53       1.64 %     12,887       104       3.22 %
   Total interest bearing liabilities
    390,667     $ 1,509       1.57 %     391,265     $ 2,625       2.72 %
                                                 
Non-interest bearing liabilities:
                                               
      Demand deposits
    36,840                       36,479                  
      Other liabilities
    1,705                       1,261                  
   Total non-interest bearing liabilities
    38,545                       37,740                  
   Stockholders' equity
    34,947                       32,223                  
      Total Liabilities and Stockholders' Equity
  $ 464,159                     $ 461,228                  
                                                 
Net Interest Income and Margin (5)
          $ 4,088       3.84 %           $ 3,237       3.03 %
                                                 

   (1) Includes loan fee income
   (2) Average rates on securities are calculated on amortized costs
   (3) Full taxable equivalent basis, using a 39% effective tax rate and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act)  interest expense disallowance
   (4) Loans outstanding include non-accrual loans
   (5) Represents the difference between interest earned and interest paid, divided by average total interest-earning assets