Broadway Financial Corporation (the “Company”) (NASDAQ Capital Market:
BYFC), today reported that its wholly-owned subsidiary, Broadway Federal
Bank, f.s.b. (the “Bank”), recently completed the sale of approximately
$8.7 million principal amount of non-performing loans, with a net book
value of $5.7 million as of March 31, 2013. In anticipation of the sale,
all of the loans sold were classified as loans held for sale as of March
31, 2013. The loans represented approximately 26% of the Bank’s
estimated principal amount of non-performing loans held for investment
and non-performing loans held for sale as of March 31, 2013.
The sale was made in a cash transaction with an institutional buyer and
consisted of approximately $4.6 million principal amount of multi-family
residential loans, representing approximately 70% of the Bank’s
non-performing multi-family residential loans, and approximately $4.1
million principal amount of commercial real estate loans, representing
almost 54% of the Bank’s non-performing commercial real estate loans. No
church loans or real estate owned were included in the sale.
The Company expects to take a charge of approximately $471 thousand
against net income in the first quarter ended March 31, 2013 because of
the sale of these loans.
Separately, in early April 2013 the Company sold both a first and a
second mortgage loan on one church property with an aggregate principal
balance of approximately $540 thousand. This sale is not expected to
result in a material loss for the Bank.
Chief Executive Officer Wayne-Kent Bradshaw stated, “These sales
represent another material reduction in our non-performing loans, which
will significantly reduce the time and resources that we devote to
managing and monitoring non-performing loans. Furthermore, the sales
further enhance our efforts to re-focus on improving operations,
pursuing growth to the extent permitted under our Cease and Desist
Orders, and completing our previously announced Recapitalization. In
addition, we believe that these sales represent another major step in
addressing regulatory requirements to reduce our non-performing loans
materially. With the loan sales completed this year, our non-performing
loans have been reduced to approximately $20.7 million, or 5.69% of
total estimated assets, after adjusting for the sales, as of March 31,
2013, down from $37.1 million, or 9.93% of total assets at the end of
2012.”
Additional information regarding the loan sales will be made available
in the Company’s Form 10-Q for the first quarter ended March 31, 2013,
which the Company expects to file in the near future.
About Broadway Financial Corporation
Broadway Financial Corporation conducts its operations through its
wholly-owned subsidiary, Broadway Federal Bank, f.s.b., which is the
leading community-oriented savings bank in Southern California serving
low to moderate income communities. We offer a variety of residential
and commercial real estate loan products for consumers, businesses, and
non-profit organizations, other loan products, and a variety of deposit
products, including checking, savings and money market accounts,
certificates of deposits and retirement accounts. The Bank operates
three full service branches, two in the city of Los Angeles, and one
located in the nearby city of Inglewood, California.
Shareholders, analysts and others seeking information about the Company
are invited to write to: Broadway Financial Corporation, Investor
Relations, 4800 Wilshire Blvd., Los Angeles, CA 90010, or visit our
website at www.broadwayfederalbank.com.
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based upon our management’s current
expectations, and involve risks and uncertainties. Actual results or
performance may differ materially from those suggested, expressed, or
implied by the forward-looking statements due to a wide range of factors
including, but not limited to, the general business environment, the
real estate market, competitive conditions in the business and
geographic areas in which the Company conducts its business, regulatory
actions or changes and other risks detailed in the Company’s reports
filed with the Securities and Exchange Commission, including the
Company’s Annual Reports on Form 10-K and Quarterly Reports on Form
10-Q. The Company undertakes no obligation to publicly revise any
forward-looking statement to reflect any future events or circumstances.
