Highlands Bancorp, Inc. (OTCQB:HSBK) parent company of Highlands State
Bank, reported that net income for the second quarter of 2015 was up
over 118% as compared to the second quarter 2014, and net income the
first six months showed an increase of over 84% as compared to the first
six months of 2014. The company reported second quarter 2015 net income
of $428,000 compared to net income of $196,000 for the same period in
2014. For the six months ended June 30, 2015 net income was $669,000
compared to net income of $363,000 for the same period in 2014. Second
quarter 2015 net income available to common stockholders was $411,000 or
$.23 per basic common share and $.22 per diluted common share compared
to net income of $179,000 or $.10 per basic and diluted common share for
the same period in 2014. Six month results reflect net income available
to common stockholders for 2015 of $635,000 or $.35 per basic common
share and $.34 per diluted common share compared to net income of
$329,000 or $.18 per basic and diluted common share for 2014.
Net interest income increased by $401,000 to $2,643,000 for the second
quarter of 2015 when compared to net interest income of $2,242,000 for
the second quarter of 2014 as a result of loan portfolio growth during
the period. For the first six months of 2015, net interest income was
$5,163,000 compared to $4,402,000 for the same period of 2014. The
provision for loan losses for the second quarter of 2015 of $215,000
decreased by $20,000 when compared to $235,000 for the second quarter of
2014, but increased $16,000 to $378,000 for the first six months of 2015
when compared to $362,000 for the same period in 2014. The higher
year-to-date provision for loan losses in 2015 is due to increased loan
portfolio balances and management’s continued assessment of the reserves
maintained on non-performing loans. There were no loan charge-offs for
the second quarter and year-to-date of 2015, compared to $89,000 and
$278,000 of loan charge-offs for the second quarter and year-to-date of
2014. There were no recoveries of previously charged off loans during
the second quarter of 2015 or the second quarter of 2014. Recoveries for
both the first six months of 2015 and 2014 totaled $1,000. Non-interest
income for the second quarter and first six months of 2015 increased
$274,000 and $622,000, respectively, when compared to the same periods
in 2014 primarily due to gains on sales of loans and from higher loan
fee income from the Bank’s mortgage subsidiary Secure Lending Solutions,
Inc. (“SLS”). The second quarter and the first six months of 2015
reflected a lower gain on the sale of investments, but increased
overdraft, debit card interchange, loan late fees, and lower writedowns
on foreclosed properties (“OREO”) when compared to the same periods in
2014. Non-interest expenses increased by $365,000 to $2,721,000 for the
second quarter of 2015, and by $913,000 to $5,195,000 for the six months
ended June 30, 2015 when compared to similar periods of 2014 due to the
additional costs associated with the Company’s continued growth and
increased earnings, including higher salary and benefit costs as a
result of the acquisition of SLS in February 2014, additions made to
staff, higher occupancy and equipment costs relating to SLS and the
openings of two new branch locations in 2014, and increased data
processing, professional, loan, and OREO charges.
The Company’s total assets were $298.8 million on June 30, 2015,
increasing $26.2 million or 9.6% when compared to total assets of $272.6
million at December 31, 2014. Deposits increased $18.7 million or 8.0%
from $234.4 million on December 31, 2014 to $253.1 million on June 30,
2015. Net loans outstanding on June 30, 2015 were $259.6 million
compared to $235.1 million on December 31, 2014, an increase of $24.5
million or 10.4%. Non-accrual loans declined to $2.3 million at June 30,
2015 compared to $2.6 million at December 31, 2014, and non-performing
loans and performing troubled debt restructurings as a percentage of
total loans declined to 1.07% at June 30, 2015 from 1.43% at December
31, 2014.
The Company serves as the holding company for Highlands State Bank.
Highlands State Bank is a full service community bank headquartered in
Vernon, New Jersey with branch offices in Sparta, Totowa, and Denville
New Jersey. Highlands State Bank provides deposit and loan banking
services to consumers and businesses in northern New Jersey. Secure
Lending Solutions, Inc., a wholly owned subsidiary of Highlands State
Bank, specializes in conventional 1-4 family mortgage loans.
Forward-Looking Statements
This news release contains certain forward-looking statements, either
expressed or implied, which are provided to assist the reader in
understanding anticipated future financial performance. These
statements involve certain risks, uncertainties, estimates and
assumptions made by management, which are subject to factors beyond the
company’s control and could impede its ability to achieve these goals.
These factors include general economic conditions, trends in interest
rates, the ability of our borrowers to repay their loans, and results of
regulatory exams, among other factors.
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Highlands Bancorp, Inc.
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Financial Highlights
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(Unaudited)
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(Dollars in thousands, except per share data)
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Three Months Ended
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Six Months Ended
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June 30,
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June 30,
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2015
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2014
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2015
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2014
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INCOME STATEMENT
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Net interest income
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|
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$
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2,643
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$
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2,242
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|
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$
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5,163
|
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$
|
4,402
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Provision for loan losses
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|
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215
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|
235
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378
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362
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Non-interest income
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|
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950
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676
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1,469
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|
|
847
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Non-interest expense
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|
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2,721
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2,356
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5,195
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|
|
4,282
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|
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Net income before income tax
|
|
|
657
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|
|
327
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|
1,059
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|
605
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Income tax (expense) benefit
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|
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(229
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)
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|
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(131
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)
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|
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(390
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)
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|
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(242
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)
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Net income
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|
|
|
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428
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|
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|
196
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|
|
669
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|
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|
363
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Preferred stock dividends and accretion
|
|
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(17
|
)
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|
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(17
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)
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|
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(34
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)
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(34
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)
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Net income available to
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|
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common stockholders
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$
|
411
|
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$
|
179
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|
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$
|
635
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|
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$
|
329
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EARNINGS PER COMMON SHARE:
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Net income available to
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common stockholders:
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Basic
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$
|
0.23
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$
|
0.10
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$
|
0.35
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$
|
0.18
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Diluted
|
|
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$
|
0.22
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$
|
0.10
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$
|
0.34
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$
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0.18
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Weighted average common shares
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Basic
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1,794,522
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1,796,679
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1,795,340
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1,793,982
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Diluted
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1,840,928
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1,839,846
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|
|
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1,841,239
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|
|
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1,840,949
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SELECTED BALANCE SHEET DATA
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AT END OF PERIOD
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|
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6/30/2015
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12/31/2014
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Total loans
|
|
|
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$
|
262,727
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|
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$
|
237,916
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|
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Allowance for loan losses
|
|
|
|
3,149
|
|
|
|
2,770
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Loans held for sale
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4,130
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4,456
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Investment securities
|
|
|
|
12,306
|
|
|
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10,877
|
|
|
|
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Total Assets
|
|
|
|
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298,823
|
|
|
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272,622
|
|
|
|
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Total Deposits
|
|
|
|
|
253,105
|
|
|
|
234,372
|
|
|
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Stockholders' Equity
|
|
|
|
23,415
|
|
|
|
22,811
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Book value per common share
|
|
$
|
9.23
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|
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$
|
8.88
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Tangible book value per common share
|
|
$
|
8.58
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|
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$
|
8.23
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ASSET QUALITY
|
|
|
|
|
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Non-accrual loans
|
|
|
$
|
2,308
|
|
|
$
|
2,559
|
|
|
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Loans past due 90 days and
|
|
|
|
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|
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still accruing
|
|
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-
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-
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Troubled debt restructurings (TDRs)
|
|
|
|
|
|
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currently in compliance with new terms
|
|
|
503
|
|
|
|
843
|
|
|
|
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|
OREO property
|
|
|
|
|
596
|
|
|
|
610
|
|
|
|
|
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Allowance for loan losses to total loans
|
|
|
1.20
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%
|
|
|
1.16
|
%
|
|
|
|
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Non-performing loans and performing TDRs
|
|
|
|
|
|
|
|
|
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to total loans
|
|
|
|
1.07
|
%
|
|
|
1.43
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%
|
|
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