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New Resource Bank Reports Third Quarter 2014 Financial Results

SAN FRANCISCO, Nov. 7, 2014 (GLOBE NEWSWIRE) -- New Resource Bank (OTCBB:NWBN) has announced unaudited financial results for the quarter ended September 30, 2014.

The bank recorded its 10th consecutive quarter of profitability. New Resource also achieved another quarter of strong year-over-year loan growth.

"These consistently strong results reflect the strength of our core markets and our expertise in serving them," said Vince Siciliano, New Resource Bank president and CEO. "We've been able to build the bank's loan portfolio while maintaining very high loan quality."

Net income for the quarter was $519,000, compared with $310,000 for the quarter ended September 30, 2013—a 67.3 percent rise. Gross loans increased 17.5 percent year over year, from $147.7 million at September 30, 2013, to $173.6 million at September 30, 2014. The bank also recorded growth in deposits, from $189.8 million at September 30, 2013, to $199.1 million at September 30, 2014, a 4.9 percent rise.

Included in the third quarter results was an operating loss due to fraudulent advances in our home equity line of credit portfolio. The bank has submitted a claim for the loss to its insurance carrier and has recognized in its financial results the amount of the insurance deductible. The bank is awaiting the insurance company's determination on payment or nonpayment of the claim. As a result of the fraud, which in the opinion of management was sophisticated, the bank has reviewed and modified its procedures associated with home equity line of credit advances.

Key financial results from the third quarter 2014 compared with the same quarter 2013 include:

  • Loan growth: Loans outstanding grew 17.5 percent, to $173.6 million from $147.7 million a year ago.
  • Asset quality: Non-performing loans as a percentage of total loans dropped to 0.13 percent at September 30, 2014, from 1.20 percent at September 30, 2013.
  • Non-performing assets to total assets: Non-performing assets to total assets decreased from 0.81 percent to 0.09 percent.
  • Deposits: Deposits rose 4.9 percent, to $199.1 million at September 30, 2014, from $189.8 million at September 30, 2013.
  • Total assets: Total assets increased 5.2 percent, to $230.7 million from $219.3 million at September 30, 2013.
  • Net interest income: Net interest income was $2.6 million, a 24.8 percent rise from $2.1 million for the quarter ended September 30, 2013.
  • Non-interest expense: Non-interest expense was $2.3 million, a 25.5 percent rise from $1.9 million for the quarter ended September 30, 2013. The increase was due to the aforementioned insurance deductible, investments in employees to support the bank's growth, and preparation for an office move in 2015.
  • Efficiency ratio: The bank's efficiency ratio for the quarter was 81.9 percent, compared with 79.8 percent for the quarter ended September 30, 2013. As with expenses, the efficiency rate rose due to the aforementioned insurance deductible, investments in employees to support the bank's growth, and preparation for an office move in 2015.
  • Risk-based capital: The bank's total risk-based capital ratio was 17.54 percent, significantly above the standard for a well-capitalized bank.

"New Resource has maintained a clear focus on meeting the needs of organic products, green building, cleantech, and sustainably managed businesses, as well as nonprofits," said Mark A. Finser, chairman of the New Resource Bank board. "That has contributed to the bank's success and, most importantly, to its mission of building sustainable communities."

Balance sheet (unaudited; dollar amounts in thousands):
September 30, 2014 September 30, 2013 Change
Assets
Cash and due from banks $ 5,623 $ 4,880 15.2%
Interest-bearing deposits 23,280 34,525 -32.6%
Money market funds -- -- 0.0%
Fed funds -- -- 0.0%
Investments 28,870 32,238 -10.4%
Gross loans 173,572 147,685 17.5%
Allowance for loan losses (3,328) (2,974) 11.9%
Premises and equipment 811 1,138 -28.8%
Other real estate owned -- -- 0.0%
Other assets 1,899 1,781 6.6%
Total assets $ 230,728 $ 219,273 5.2%
Liabilities and equity
Deposits $ 199,149 $ 189,763 4.9%
Borrowings -- -- 0.0%
Other liabilities 1,066 1,239 -14.0%
Total liabilities 200,215 191,002 4.8%
Equity 30,513 28,271 7.9%
Total liabilities and equity $ 230,728 $ 219,273 5.2%
Performance ratios:
September 30, 2014 September 30, 2013

Book value per outstanding share
$5.34 $5.05
Leverage ratio 13.02% 13.62%
Total risk-based capital ratio 17.54% 19.05%
Loan loss reserves to total loans 1.92% 2.01%
Loan loss reserves to non-performing loans 1524% 168%
Non-performing loans to total loans 0.13% 1.20%
Non-performing assets to total assets 0.09% 0.81%
Summary income statement (unaudited; dollar amounts in thousands):
Quarter ended
September 30, 2014 September 30, 2013 Change
Interest income $ 2,660 $ 2,146 23.9%
Interest expense 28 37 -24.5%
Net interest income 2,632 2,109 24.8%
Non-interest income 206 213 -3.5%
Provision for loan loss (20) 150 0.0%
Non-interest expense 2,324 1,852 25.5%
Net operating income/(loss) 534 320 66.8%
Taxes 15 10 NM
Net income/(loss) $ 519 $ 310 67.3%
Net interest margin 4.65% 4.09% 13.9%
Efficiency ratio 81.89% 79.76% 2.7%

NM = not meaningful

About New Resource Bank

New Resource Bank (https://www.newresourcebank.com) is the premier bank for people who are leading the way to a more sustainable world. We match an entrepreneurial spirit with a dedication to achieving environmental and social as well as financial returns. Our mission is to advance sustainability with everything we do—the loans we make, the way we operate and our commitment to putting deposits to work for good.

This press release contains forward-looking statements such as statements about certain expectations and projections, and the bank's preparedness for the coming year. Forward-looking statements are based on currently available information, are not guarantees of future performance and are subject to numerous risks and uncertainties. Such risks and uncertainties may include, but are not necessarily limited to, fluctuations in interest rates; fluctuations in asset prices, including real estate; inflation; changes in laws or government regulations or policies; general economic conditions, including the real estate market in California; the adequacy of the bank's allowance for loan losses; and other factors beyond the bank's control. Such risks and uncertainties could cause results for subsequent interim periods or for entire years to differ materially from those indicated. Readers should not place undue reliance on forward-looking statements, which reflect management's view only as of the date of this press release. The bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

CONTACT: Media contact: Vince Siciliano, President and CEO 415.995.8170 vsiciliano@newresourcebank.com

Source:New Resource Bank