NorthEast Community Bancorp, Inc. Reports Results for the Quarter Ended March 31, 2020
WHITE PLAINS, N.Y., May 01, 2020 (GLOBE NEWSWIRE) — NorthEast Community Bancorp, Inc. (OTC: NECB) (the “Company”), a majority owned subsidiary of NorthEast Community Bancorp, MHC, and the parent holding company of NorthEast Community Bank (the “Bank”), reported net income of $3.26 million for the quarter ended March 31, 2020 compared to net income of $3.22 million for the quarter ended March 31, 2019, an increase of 1.24%.
Financial Condition and Operating Results for March 31, 2020 compared to March 31, 2019:Net interest income for the three months ended March 31, 2020 decreased by $340,000, or 3.40%, to $9.67 million from $10.01 million for the three months ended March 31, 2019.Net income before taxes for the three months ended March 31, 2020 was $4.25 million compared to $4.21 million for the three months ended March 31, 2019, an increase of 1.09%. The increase in net income before taxes was the result of an increase of $278,000 in non-interest income and a decrease of $162,000 in provision for loan losses, partially offset by a decrease of $340,000 in net interest income and an increase of $54,000 in non-interest expense.Total consolidated assets decreased by $23.6 million, or 2.53%, to $908.48 million at March 31, 2020 from $932.07 million at March 31, 2019. Loans receivable (net) increased by $23.08 million, or 3.02%, to $787.53 million at March 31, 2020 from $764.45 million at March 31, 2019, while commitments, loans-in-process and standby letters of credit outstanding decreased to $444.51 million at March 31, 2020 compared to $484.79 million at March 31, 2019. The increase in loans receivable was primarily due to growth in our construction loan portfolio resulting from our continued focus on growing our construction lending operations in the lower Hudson Valley.Total liabilities at March 31, 2020 were $763.39 million compared to $799.38 million at March 31, 2019, a decrease of $35.99 million, or 4.50%. The decrease in total liabilities was primarily due to a $24.42 million decrease in deposits from $748.73 million at March 31, 2019 to $724.31 million at March 31, 2020 as we decreased our sourced wholesale deposits and increased our retail deposits.Federal Home Loan Bank advances decreased by $10.30 million, or 26.89% to $28.00 million at March 31, 2020 from $38.30 million at March 31, 2019.Total stockholder’s equity increased by $12.40 million, or 9.34%, to $145.09 million at March 31, 2020 from $132.69 million at March 31, 2019. The increase was a result of net income of $12.99 million for the twelve month period ended March 31, 2020, partially offset by dividends declared and paid and accounting adjustments during the twelve month period.Financial Condition and Operating Results for March 31, 2020 compared to December 31, 2019:Net interest income increased by $352,000, or 3.78%, to $9.67 million for the quarter ended March 31, 2020 compared to $9.32 million for the quarter ended December 31, 2019.Net income before taxes for the quarter ended March 31, 2020 was $4.25 million, an increase of $390,000, or 10.10%, compared to $3.86 million for the quarter ended December 31, 2019.Total consolidated assets decreased by $46.69 million, or 4.89%, to $908.48 million at March 31, 2020 from $955.17 million at December 31, 2019. Loans receivable (net) increased by $39.65 million or 5.30% to $787.53 million at March 31, 2020 from $747.88 million at December 31, 2019, while commitments, loans-in-process and standby letters of credit outstanding increased to $444.51 million as of March 31, 2020 compared to $434.96 million at December 31, 2019.Total liabilities at March 31, 2020 were $763.39 million compared to $813.06 million at December 31, 2019, a decrease of $49.67 million, or 6.11%. The decrease in total liabilities was due to a $54.85 million decrease in deposits from $779.16 million at December 31, 2019 to $724.31 million at March 31, 2020. Federal Home Loan Bank advances increased by $7.00 million, or 33.33% to $28.00 million at March 31, 2020 from $21.00 million at December 31, 2019.Covid-19 Pandemic Update:As a result of the Pandemic, NorthEast Community Bank is proactively working with borrowers whose payments have been made in accordance with the terms and conditions of the governing loan documents, and which under all normal economic conditions would be considered Pass rated loans. With respect to commercial real estate loans, we have granted a deferral of mortgage payments on such loans for periods of 90 days at a time with additional 90 day deferments available should the Pandemic continue. With respect to construction loans, maturity extensions have been granted based on the inability of completed projects to refinance with permanent lenders since most title companies are closed or working with severe delays in processing.Like most financial institutions a percentage of our loans have been or will be negatively affected at least temporarily by the Pandemic. In the case of commercial real estate loans, this may be due to reductions in rental income or mandated closure of owner occupied commercial space. In the case of construction loans, the closing of town and/or village offices overseeing zoning and planning, building permits, various construction inspections and water and sewer hook-ups and the State mandated temporary shut-down of construction projects have, or may impact such loans.As of April 30th our commercial real estate loan portfolio had an average debt coverage ratio of 2.47% and an average loan-to-value ratio of less than 40.00%.In addition, as of April 30th, we have granted deferrals with respect to $51.3 million of commercial real estate loans, $71.9 million of construction loans and $3.9 million of commercial and industrial loans. None of these loans are considered troubled debt restructurings (TDR) under the regulatory definition of TDRs.We also participate in the SBA’s Paycheck Protection Program, and have received approval from the SBA to fund more than $17 million of loans to assist the small businesses in our local communities.NorthEast Community Bancorp, Inc.’s total stockholders’ equity at March 31, 2020 is a strong 15.97% compared to 14.88% at December 31, 2019.NorthEast Community Bancorp, Inc. is the holding company for NorthEast Community Bank. NorthEast Community Bank is a New York State-chartered savings bank that operates six full-service branches in New York State and three full-service branches in Danvers, Framingham and Quincy, Massachusetts and loan production offices in White Plains and New City, New York. This release contains “forward-looking statements” that are based on assumptions and may describe future plans, strategies and expectations of the Company. These forward-looking statements are generally identified by the use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project” or similar expressions. The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors that could have a material adverse effect on the operations of the Company and its subsidiaries include, but are not limited to, changes in market interest rates, regional and national economic conditions, legislative and regulatory changes, monetary and fiscal policies of the United States government, including policies of the United States Treasury and the Federal Reserve Board, the quality and composition of the loan or investment portfolios, demand for loan products, deposit flows, competition, demand for financial services in the Company’s market area, changes in the real estate market values in the Company’s market area and changes in relevant accounting principles and guidelines These risks and uncertainties should be considered in evaluating any forward-looking statements and undue reliance should not be placed on such statements. Except as required by applicable law or regulation, the Company does not undertake, and specifically disclaims any obligation, to release publicly the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of the statements or to reflect the occurrence of anticipated or unanticipated events.Contact:
Kenneth A. Martinek
Chief Executive Officer