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Ocean Shore Holding Co. Reports 4th Quarter 2010 and Year-End Results

^{Published on 2011-01-25 06:10:26 - Market Wire}
 

OCEAN CITY, N.J.--([ BUSINESS WIRE ])--Ocean Shore Holding Co. (NASDAQ:OSHC) today announced net income of $1,428,000, or $0.21 per basic and diluted share, for the quarter ended December 31, 2010 as compared to $1,314,000, or $0.19 per basic and diluted share, for the same quarter last year.

For the full year ended December 31, 2010, net income rose to $5,444,000, or $0.80 per basic share and diluted share, as compared to $4,211,000, or $0.60 per basic share and $0.59 per diluted share, for 2009.

Ocean Shore Holding Co. (the "Company") is the holding company for Ocean City Home Bank (the "Bank"), a federal savings bank headquartered in Ocean City, New Jersey. The Bank operates a total of ten full-service banking offices in eastern New Jersey.

aWe are extremely proud to report that our net income for 2010 represents the Companya™s best annual performance since becoming a public company in 2004. Notwithstanding a challenging operating environment, we have succeeded in growing our franchise this year, with asset growth of 9% based entirely on growth in customer deposits. We have accomplished this while maintaining strong asset quality in a depressed real estate market, which we believe speaks well for our conservative operating philosophy,a said Steven E. Brady, President and CEO.

Balance Sheet Review

Total assets grew $69.7 million, or 9.1%, to $839.9 million at December 31, 2010 from December 31, 2009. Loans receivable, net, decreased $3.3 million, or (0.5)%, to $660.3 million. The decrease in loans receivable resulted from decreases in real estate loans of $1.1 million, consumer loans of $3.6 million and commercial loans of $0.9 million offset by an increase in real estate construction loans of $3.0 million. Cash and cash equivalents increased $77.8 million to $110.9 million while investments and mortgage-backed securities decreased $5.7 million, or 19.4%, to $23.7 million.

Deposits grew $65.9 million, or 12.3%, to $603.3 million at December 31, 2010 from December 31, 2009. Total borrowings remained unchanged at $125.5 million, including $110.0 million of FHLB advances.

Asset Quality

The provision for loan losses totaled $76,000 for the fourth quarter of 2010 compared to $357,000 for the fourth quarter of 2009 and $125,000 for the third quarter of 2010. The decrease in the provision resulted from a decrease in specific reserves on non-performing loans in the fourth quarter of 2010 compared to 2009. The provision decreased to $892,000 for the year-ended 2010 compared to $1,251,000 for the year-ended 2009. The allowance for loan losses totaled $4.0 million, or 0.60% of total loans, at December 31, 2010 compared to $3.5 million, or 0.52% of total loans, at December 31, 2009. The Company experienced $380,000 in charge-off activity for 2010 compared to $460,000 for 2009.

Non-performing assets totaled $5.3 million, or 0.79% of total assets, at December 31, 2010, compared to $1.9 million, or 0.25% of total assets, at December 31, 2009. Non-performing assets consisted of twelve residential mortgages totaling $4.3 million, three commercial mortgages totaling $729,000, two commercial loans totaling $134,000, two consumer equity loans totaling $77,000 and one real estate owned property totaling $98,000. Specific reserves recorded for these loans at December 31, 2010 were $482,000.

Income Statement Analysis

Net interest income was unchanged at $5.9 million for the fourth quarter of 2010 compared to the fourth quarter of 2009. Net interest margin decreased one basis points in the quarter ended December 31, 2010 to 3.41% from 3.42% for the quarter ended December 31, 2009. On a linked-quarter basis, net interest margin increased 2 basis points from 3.39% in the third quarter of 2010. A slight increase in net interest income for the fourth quarter was the result of an increase in average interest-earning assets of $3.7 million and a decrease of 42 basis points in the average cost of interest-bearing liabilities to 1.95% from 2.37%, offset by an increase in average interest-bearing liabilities of $66.5 million and a decrease of 22 basis points in the average yield on interest-earning assets to 5.34% from 5.56%.

Net interest income increased $1.7 million, or 7.7%, for the full year to $23.9 million compared to the prior year. An increase in net interest margin of 11 basis points to 3.43% from 3.32% was mainly the result of a decrease in the cost of interest-bearing liabilities of 41 basis points offset by a decrease in the yield on interest-earning assets of 16 basis points.

Other expenses increased $129,000, or 3.0%, to $4.37 million for the fourth quarter of 2010, compared to $4.25 million for the fourth quarter of 2009. Other expenses increased $1.4 million, or 8.6%, to $17.5 million for the year ended December 31, 2010 compared to $16.1 million for the year-ended December 31, 2009. Other expenses increased in 2010 over the prior year as a result of additional expenses associated with the opening of a new branch in the fourth quarter of 2009 as well as normal increases in salaries and benefits, occupancy and equipment, marketing, other expenses, partially offset by decreases in FDIC deposit insurance and qualified deferred costs associated with closed loans.

This press release, as well as other written communications made from time to time by the Company and its subsidiaries and oral communications made from time to time by authorized officers of the Company, may contain statements relating to the future results of the Company (including certain projections and business trends) that are considered "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 (the aPSLRAa). Such forward-looking statements may be identified by the use of such words as "believe," "expect," "anticipate," "should," "planned," "estimated," "intend" and "potential." For these statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the PSLRA.

The Company cautions you that a number of important factors could cause actual results to differ materially from those currently anticipated in any forward-looking statement. Such factors include, but are not limited to: prevailing economic and geopolitical conditions; changes in interest rates, loan demand, real estate values and competition; changes in accounting principles, policies, and guidelines; changes in any applicable law, rule, regulation or practice with respect to tax or legal issues; and other economic, competitive, governmental, regulatory and technological factors affecting the Company's operations, pricing, products and services and other factors that may be described in the Companya™s annual report on Form 10-K and quarterly reports on Form 10-Q as filed with the Securities and Exchange Commission. The forward-looking statements are made as of the date of this release, and, except as may be required by applicable law or regulation, the Company assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.