OCEAN SHORE HOLDING CO OCEAN CITY, N.J., July 28, 2015 /PRNewswire/ -- Ocean Shore Holding Co. (NASDAQ: OSHC) today announced net income of $1,739,000, or $0.29 per diluted share, for the quarter ended June 30, 2015, as compared to $1,532,000, or $0.24 per diluted share, for the second quarter of 2014. Net income for the six months ended June 30, 2015 was $3,452,000, or $0.57 per diluted share, as compared to $3,119,000, or $0.48 per diluted share, for the same period in 2014.
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Ocean Shore Holding Co. is the holding company for Ocean City Home Bank, a federal savings bank headquartered in Ocean City, New Jersey. Ocean City Home Bank operates a total of eleven full-service banking offices in eastern New Jersey.
In a separate release, the Company announced the redemption of $7 million principal amount of its 8.67% Capital Securities issued by Ocean Shore Capital Trust I, a wholly-owned subsidiary of the Company. The redemption date for the Capital Securities is August 26, 2015. The Company will pay a redemption premium of $91,000 to be recorded in the third quarter of 2015.
"Our second quarter results reflect sustained performance following our solid first quarter earnings," said Steven E. Brady, President and CEO. "We benefited from lower funding costs, an increase in fee income, and lower operating expenses."
"With the redemption of our trust preferred securities, which we announced yesterday, net interest income will benefit from the reduction of annual interest expense of $607,000 without a significant reduction in our strong capital levels," said Brady.
Balance Sheet Review
Total assets decreased $5.8 million, or 0.6%, to $1,019.0 million at June 30, 2015 from $1,024.8 million at December 31, 2014. Loans receivable, net, increased $6.8 million, or 0.9%, to $780.8 million at June 30, 2015 from $774.0 million at December 31, 2014. Investments and mortgage-backed securities increased $4.2 million, or 3.8%, to $115.6 million during the first six months of 2015. Cash and cash equivalents decreased $16.4 million, or 20.5%, to $63.9 million at June 30, 2015 from $80.3 million at December 31, 2014. Loan originations and other advances totaling $79.4 million were offset by payoffs and payments received of $72.6 million, resulting in a $6.8 million increase in the portfolio. The increase in investments and mortgage-backed securities resulted from purchases offset by normal repayments, calls and maturities. Cash and cash equivalents were used to fund the increase in loans and investments and deposit withdrawals.
Deposits decreased $7.2 million, or 0.9%, to $779.9 million at June 30, 2015 from $787.1 million at December 31, 2014. Checking accounts increased $11.4 million, savings accounts increased $3.5 million, certificates of deposit decreased $628,000 and municipal deposits decreased $21.5 million at June 30, 2015 compared to December 31, 2014. Municipal deposits declined as a result of seasonal withdrawals. Total borrowings were unchanged at $117.2 million.
Stock Repurchase Plan
During the June 2015 quarter, the Company repurchased a total of 49,200 shares at a weighted average cost of $14.91. As of June 30, 2015, 16,400 shares remain to be purchased under the previously announced share repurchase plan.
Asset Quality
The provision for loan losses totaled $178,000 for the second quarter of 2015 compared to $50,000 for the second quarter of 2014 and $153,000 for the first quarter of 2015. The allowance for loan losses totaled $3.4 million, or 0.43% of total loans, at June 30, 2015 compared to $3.8 million, or 0.49% of total loans, at December 31, 2014. The Company experienced $699,000 in net charge-off activity for the first six months of 2015 as compared to $270,000 in net charge-off activity for the first six months of 2014.
Non-performing assets totaled $7.6 million, or 0.74% of total assets, at June 30, 2015, compared to $6.9 million, or 0.68% of total assets, at December 31, 2014. Non-performing assets consisted of seventeen real estate residential mortgages totaling $2.7 million, five real estate commercial mortgage totaling $1.6 million, one real estate construction mortgage totaling $143,000, six consumer equity loans totaling $489,000, nine TDR non-accrual loans totaling $1.5 million and six real estate owned properties totaling $1.2 million.
Income Statement Analysis
Net interest income increased $171,000, or 2.5%, to $7.1 million for the second quarter of 2015 compared to $6.9 million in the second quarter of 2014. Net interest margin increased 4 basis points in the quarter ended June 30, 2015 to 3.16% versus 3.12% for the quarter ended June 30, 2014 and decreased 3 basis points from 3.19% for the quarter ended March 31, 2015. The increase in net interest income in the second quarter of 2015 compared to the second quarter of 2014 resulted from an increase in average interest-earning assets of $8.8 million and a decrease in average interest-bearing liabilities of $86.4 million offset by a decrease of 5 basis points in the average yield on interest-earning assets. The average cost of interest-bearing liabilities remained stable at 0.94% over the comparable quarters.
Net interest income increased $302,000, or 2.2%, to $14.1 million for the first six months of 2015 compared to the same period in the prior year. Net interest margin increased 4 basis points for the six months ended June 30, 2015 to 3.18% versus 3.14% for the six months ended June 30, 2014. The increase in net interest income for the six month period was the result of a decrease in average interest-bearing liabilities of $82.8 million, an increase in average interest-earning assets of $9.9 million and a decrease in the average cost of interest-bearing liabilities of 1 basis point to 0.93%, offset by a decrease of 7 basis points in the average yield on interest-earning assets.
Other income increased $47,000 to $1.1 million and $90,000 to $2.2 million for the second quarter and first six months of 2015, respectively, compared to the same periods in 2014. The increase in other income resulted from increases in deposit account fees and debit card commissions offset by decreases in other income over the prior periods.
Other expenses decreased $157,000, or 2.8%, to $5.4 million for the second quarter of 2015, compared to $5.5 million for the second quarter of 2014. Other expenses decreased $162,000, or 1.5%, to $10.8 million for the six months ended June 30, 2015, compared to $11.0 million for the six months ended June 30, 2014. For the second quarter of 2015 decreases in occupancy and equipment, REO and other expenses of $211,000 were offset by increases in salaries and benefits, FDIC insurance and marketing expenses of $54,000. For the six months ended June 30, 2015 decreases in occupancy and equipment, REO and other expenses of $286,000 were offset by increases in salaries and benefits, FDIC insurance and marketing expenses of $124,000.
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 PSLRA). 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 Company'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.
SELECTED FINANCIAL CONDITION DATA (Unaudited)
June 30, December 31,
2015 2014 % Change
---- ---- --------
(Dollars in thousands)
Total
assets $1,019,031 $1,024,754 (0.6)%
Cash
and
cash
equivalents 63,853 80,307 (20.5)
Investment
securities 115,564 111,317 3.8
Loans
receivable,
net 780,789 774,017 0.9
Deposits 779,859 787,078 (0.9)
FHLB
advances 110,000 110,000 0.0
Subordinated
debt 7,217 7,217 0.0
Stockholder's
equity 106,883 105,811 1.0
SELECTED OPERATING DATA (Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
2015 2014 % Change 2015 2014 % Change
---- ---- -------- ---- ---- --------
(In thousands, except per share and per share amounts)
Interest and dividend income $8,764 $8,793 (0.3)% $17,551 $17,665 (0.6)%
Interest expense 1,708 1,908 (10.5) 3,403 3,819 (10.9)
----- ----- ----- -----
Net interest income 7,056 6,885 2.5 14,148 13,846 2.2
Provision for loan losses 178 50 256.0 331 138 139.9
--- --- --- ---
Net interest income after
provision for loan losses 6,878 6,835 0.6 13,817 13,708 0.8
Other income 1,133 1,086 4.3 2,182 2,092 4.3
Other expense 5,373 5,530 (2.8) 10,814 10,976 (1.5)
----- ----- ------ ------
Income before taxes 2,638 2,391 10.3 5,185 4,824 7.5
Provision for income taxes 899 859 4.7 1,733 1,705 1.6
--- --- ----- -----
Net Income $1,739 $1,532 13.5 $3,452 $3,119 10.7
Earnings per share basic $0.29 $0.24 $0.58 $0.49
Earnings per share diluted $0.29 $0.24 $0.57 $0.48
Average shares outstanding basic 5,920,475 6,361,499 5,952,732 6,386,799
Average shares outstanding diluted 6,036,007 6,495,037 6,062,866 6,507,498
.
Three Months Ended Three Months Ended
June 30, 2015 June 30, 2014
------------- -------------
Average Yield/Cost Average Yield/Cost
Balance Balance
------- -------
(Dollars in thousands)
Loans $776,880 4.21% $762,364 4.27%
Investment securities 115,966 2.02% 121,709 2.14%
------- -------
Total interest-earning assets 892,846 3.93% 884,073 3.98%
Interest-bearing deposits 607,339 0.41% 690,693 0.36%
Total borrowings 117,217 3.73% 120,309 4.25%
------- -------
Total interest-bearing liabilities 724,556 0.94% 811,002 0.94%
Interest rate spread 2.98% 3.04%
Net interest margin 3.16% 3.12%
Six Months Ended Six Months Ended
June 30, 2015 June 30, 2014
------------- -------------
Average Yield/Cost Average Yield/Cost
Balance Balance
------- -------
(Dollars in thousands)
Loans $775,426 4.22% $756,318 4.32%
Investment securities 115,004 2.09% 124,247 2.16%
------- -------
Total interest-earning assets 890,430 3.94% 880,565 4.01%
Interest-bearing deposits 613,601 0.40% 693,324 0.37%
Total borrowings 117,217 3.71% 120,309 4.23%
------- -------
Total interest-bearing liabilities 730,818 0.93% 813,633 0.94%
Interest rate spread 3.01% 3.07%
Net interest margin 3.18% 3.14%
ASSET QUALITY DATA (Unaudited)
Six Months Year Ended
Ended
December 31,
June 30, 2015 2014
------------- ----
(Dollars in thousands)
Allowance for Loan
Losses:
Allowance at beginning
of period $3,760 $4,199
Provision for loan
losses 331 462
Charge-offs (699) (977)
Recoveries - 76
--- ---
Net charge-offs (699) (901)
---- ----
Allowance at end of
period $3,392 $3,760
====== ======
0.43% 0.49%
Allowance for loan
losses as a percent of
total loans
Allowance for loan
losses as a percent of
nonperforming loans 53.1% 60.0%
At June 30, At December 31,
2015 2014
(Dollars in thousands)
Nonperforming
Assets:
Nonaccrual loans:
Real estate
mortgage -
residential $2,678 $3,626
Real estate
mortgage -
commercial 1,580 803
Real estate
mortgage -
construction 143 143
Commercial
business loans - 501
Consumer loans 489 502
--- ---
Total 4,890 5,575
Trouble debt
restructurings -
nonaccrual 1,496 694
----- ---
Total nonaccrual
loans 6,386 6,269
Real estate owned 1,193 650
----- ---
Total
nonperforming
assets $7,579 $6,919
====== ======
0.82% 0.81%
Nonperforming
loans as a
percent of total
loans
Nonperforming
assets as a
percent of total
assets 0.74% 0.68%
SELECTED FINANCIAL RATIOS (Unaudited)
Six Months Ended
June 30,
--------
2015 2014
---- ----
Selected Performance Ratios:
Return on average assets (1) 0.67% 0.61%
Return on average equity (1) 6.46% 5.82%
Interest rate spread (1) 3.01% 3.07%
Net interest margin (1) 3.18% 3.14%
Efficiency ratio 66.22% 68.87%
--(1) Annualized.
OCEAN SHORE HOLDING COMPANY - QUARTERLY DATA (Unaudited)
Q2 Q1 Q4 Q3 Q2
2015 2015 2014 2014 2014
---- ---- ---- ---- ----
(In thousands except per share amounts)
Income Statement Data:
Net interest income $7,056 $7,092 $6,997 $6,958 $6,885
Provision for loan losses 178 153 200 125 50
--- --- --- --- ---
Net interest income after
provision for loan losses 6,878 6,939 6,797 6,833 6,835
Other income 1,133 1,049 1,052 1,102 1,086
Other expense 5,373 5,442 5,337 5,451 5,530
----- ----- ----- ----- -----
Income before taxes 2,638 2,546 2,512 2,484 2,391
Provision for income taxes 899 833 914 904 859
--- --- --- --- ---
Net income $1,739 $1,713 $1,598 $1,580 $1,532
====== ====== ====== ====== ======
Share Data:
Earnings per share basic $0.29 $0.29 $0.26 $0.25 $0.24
Earnings per share diluted $0.29 $0.28 $0.26 $0.25 $0.24
Average shares outstanding basic 5,920,475 5,985,347 6,068,184 6,226,913 6,361,499
Average shares outstanding diluted 6,036,007 6,095,177 6,178,602 6,361,856 6,495,037
Total shares outstanding 6,257,899 6,251,912 6,393,344 6,469,943 6,759,423
Balance Sheet Data:
Total assets $1,019,031 $1,029,809 $1,024,754 $1,040,029 $1,013,305
Investment securities 115,564 114,830 111,317 114,927 119,899
Loans receivable, net 780,789 770,261 774,017 773,796 769,556
Deposits 779,859 792,891 787,078 804,552 770,831
FHLB advances 110,000 110,000 110,000 110,000 110,000
Subordinated debt 7,217 7,217 7,217 7,217 10,309
Stockholders' equity 106,883 105,643 105,811 105,149 108,217
Asset Quality:
Non-performing assets $7,579 $7,027 $6,919 $7,887 $7,349
Non-performing loans to total loans 0.82% 0.83% 0.81% 0.97% 0.91%
Non-performing assets to total assets 0.74% 0.68% 0.68% 0.76% 0.73%
Allowance for loan losses $3,392 $3,384 $3,760 $4,029 $4,067
Allowance for loan losses to total 0.43% 0.44% 0.49% 0.52% 0.53%
loans
Allowance for loan losses to non- performing loans 53.1% 52.7% 60.0% 53.7% 58.0%
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SOURCE Ocean Shore Holding Co.
