Business & Finance
Business and Finance
Business and Finance
Mon, February 23, 2009
Sun, February 22, 2009
Fri, February 20, 2009 New Resource Bank Presents Financial Results for the Fourth Quarter and Year-ended December 31, 2008
SAN FRANCISCO--([ BUSINESS WIRE ])--New Resource Bank (OTCBB:NWBN), announced unaudited financial results for the fourth quarter and year ended December 31, 2008.
In its second full year of operation, the Bank's total assets grew over $44 million to $170 million. Deposits grew $38 million to a total of $142 million, while loans grew $51 million to a total of $112 million. Additionally, as of December 31, 2008, the Bank reported $23 million in non-bank money market investment funds for our clients.
"Our 2008 asset growth, in a very difficult year for banking, reflected continued acceptance by our community and was a testament to our excellence in customer service and client satisfaction," stated President & CEO Clay Jones.
"We are pleased with the ongoing growth in our client relationships which numbered over 1,500 at December 31, 2008, compared to 880 at the end of 2007," stated Peter Liu, Vice Chair and Chief Business Development Officer.
"Operating results were affected by weakness in loan quality, principally in residential land and construction loans, beginning in the third quarter. We believe we were quick to recognize loan weaknesses related to the downturn in the residential construction market, and we have taken proactive steps to aggressively manage our troubled loans while adequately reserving for the risk. With our strong capital base and high liquidity levels, we are well-positioned to weather the current upheaval in the residential housing and banking markets," stated Mr. Jones.
The capital ratios of the bank substantially exceed the regulatory definition of "well capitalized" with a Total Risk-based Capital Ratio of 19.4%, a Tier I Risk-based Capital Ratio of 18.1% and a Tier I Leverage Ratio of 14.6%.
Below is a summary of selected balance sheet items:
Unaudited (all dollar | End of period | Net Change | % Change | |||||||||
| Dec-08 | Dec-07 | |||||||||||
| Gross Loans | $ | 112,524 | $ | 62,033 | $ | 50,491 | 81 | % | ||||
| Allowance for Loan Losses | 3,080 | 952 | 2,128 | 224 | % | |||||||
| Deposits | 142,999 | 105,345 | 37,654 | 36 | % | |||||||
| Shareholders' Equity | 25,707 | 20,545 | 5,162 | 25 | % | |||||||
| Total Assets | 170,416 | 126,361 | 44,055 | 35 | % | |||||||
The bank reported a net loss of $4.9 million for the quarter and $10.6 million for the year ending December 31, 2008, compared to a loss of $800,000 and $3.2 million for the prior-year periods. Increased losses were driven by credit costs of $4.0 million in the fourth quarter and $9.0 million for the full year ending December 31, 2008, compared to 395,000 and 908,000 in the prior year periods.
The following is a summary of selected income statement information:
| Quarter Ended | Year Ended | |||||||||||||||
Unaudited (all dollar | Dec-08 | Dec-07 | Dec-08 | Dec-07 | ||||||||||||
| Interest Income | $ | 1,950 | $ | 2,079 | $ | 8,851 | $ | 5,563 | ||||||||
| Interest Expense | 509 | 1,002 | 2,929 | 2,630 | ||||||||||||
| Net Interest Income | 1,441 | 1,078 | 5,922 | 2,933 | ||||||||||||
| Non-Interest Income | 103 | 40 | 372 | 83 | ||||||||||||
| Provision for Loan Loss | 4,001 | 395 | 9,022 | 908 | ||||||||||||
| Non-Interest Expense | 2,414 | 1,522 | 7,820 | 5,340 | ||||||||||||
| Net Operating Income/(Loss) | (4,871 | ) | (800 | ) | (10,549 | ) | (3,232 | ) | ||||||||
| Taxes | - | - | 1 | (4 | ) | |||||||||||
| Net Income/(Loss) | $ | (4,871 | ) | $ | (800 | ) | $ | (10,550 | ) | $ | (3,228 | ) | ||||
The increased net interest income for the quarter and year end was primarily related to increased earning assets including loans, offset by a compression in market interest rates as deposit rates approached an absolute interest rate floor.
The provision for loan losses was $4 million in the fourth quarter of 2008, compared to $395,000 in the prior-year period. The provision was primarily related to six land and construction loans that have been identified as classified loans. As of December 31, 2008, the allowance for loan losses totaled $3.1 million or 2.7% of gross loans. As of December 31, 2008, the bank reported six non-accrual loans, all but one in real estate related credits, totaling $14 million or 8.1% of total assets. As of December 31, 2007, the bank reported zero non-accrual loans. Net charge offs totaled $4.9 million for the quarter and $6.7 million for the year, compared to none in the prior year periods.
This release may contain forward-looking statements that are subject to risks and uncertainties. Such risks and uncertainties may include, but are not necessarily limited to, fluctuations in interest rates, inflation, government regulations, and general economic conditions, including the real estate market in California and other factors beyond the Bank's control. Such risks and uncertainties could cause results for subsequent interim periods or for the entire year to differ materially from those indicated. Readers should not place undue reliance on the forward-looking statements, which reflect management's view only as of the date hereof. The Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.
New Resource Bank is committed to setting a new standard in customer service while financing efficient and sustainable resources in its community.The Bank is founded by leading entrepreneurs, along with seasoned banking executives from national and local community banks.
