CLINTON, N.J., July 19 /PRNewswire-FirstCall/ -- Unity Bancorp, Inc.
(Nasdaq: UNTY), parent company of Unity Bank, reported net income of $1.5
million, or $0.21 per diluted share, for the quarter ended June 30, 2007,
compared to net income of $1.6 million, or $0.23 per diluted share, for the
quarter ended June 30, 2006. Return on average assets and average common
equity for the second quarter of 2007 were 0.89% and 13.14%, respectively, as
compared to 1.03% and 15.39%, respectively, for the second quarter of 2006.
For the six months ended June 30, 2007, net income was $3.0 million, or
$0.41 per diluted share, compared to $3.3 million, or $0.45 per diluted share
for the same period a year ago. Return on average assets and average common
equity for the six months ended June 30, 2007, were 0.88% and 12.94%,
respectively, as compared to 1.05% and 15.82%, respectively, for the prior
year's comparable period.
"During the second quarter of 2007, we had significant growth in both our
loan and deposit portfolios, in addition to an improvement in credit quality,"
said Unity President and Chief Executive Officer, James A. Hughes. "Although
the rate environment continues to be a challenge, we will continue to grow our
earning asset base, which will have a favorable effect on future earnings."
Net interest income was $6.1 million for the second quarter of 2007,
consistent from the same period a year ago. Net interest income was benefited
by an increase in interest-earning assets offset by a decrease in net interest
margin. Net interest margin was 3.71% for the second quarter of 2007,
compared to 3.99% for the second quarter of 2006.
Net interest income was $12.1 million for the six months ended June 30,
2007, consistent from the same period a year ago. Net interest income was
benefited by an increase in interest-earning assets offset by a decrease in
net interest margin. Net interest margin was 3.73% for the six months ended
2007, compared to 4.05% for the same period a year ago.
The provision for loan losses for the second quarter of 2007 was $350
thousand, compared to $250 thousand for the second quarter of 2006. Net loan
charge-offs for the quarter ended June 30, 2007 were $110 thousand, compared
to net charge-offs of $113 thousand for the quarter ended June 30, 2006. The
provision for loan losses was $550 thousand for the six months ended June 30,
2007, flat from the same period a year ago. Net loan charge-offs for the six
months ended June 30, 2007 were $177 thousand, compared to $185 thousand for
the same period a year ago.
Total noninterest income for the second quarter of 2007 was $1.7 million,
up 6.1%, from the same period a year ago. Service charges on deposits for the
second quarter were $339 thousand, a decrease of $70 thousand, compared to the
second quarter of 2006, primarily due to fee waivers and the acceleration of
the electronic clearing of checks "Check 21". Service and loan fees were $380
thousand for the second quarter of 2007, down $26 thousand from a year ago.
Gains on sales of SBA loans amounted to $824 thousand for the second quarter
of 2007, compared to $558 thousand for the quarter ended June 30, 2006,
primarily due to the higher volume of loans sold, offset by reduced premiums.
Total noninterest income for the six months ended June 30, 2007, was $3.4
million, down 6.1% from the same period a year ago. Service charges on
deposits for the six months ended were $688 thousand, a decrease of $154
thousand, compared to the same period a year ago, primarily due to the waiving
of fees and the acceleration of Check 21. Service and loan fees were $746
thousand for the second quarter of 2007, down $55 thousand from the same
period a year ago. Gains on sales of SBA loans amounted to $1.5 million for
the six months ended June 30, 2007, compared to $1.3 million for the same
period a year ago, primarily due to the higher volume of loans sold offset by
reduced premiums.
Total noninterest expenses for the second quarter of 2007 were $5.3
million, an increase of 5.3% from the prior year's comparable quarter.
Compensation and benefits increased 2.2% due to annual cost of living
increases and rising health insurance costs, partially offset by a planned
reduction in the employee base. Loan servicing costs increased due to
collection expenses associated with non-accrual loans.
Total noninterest expenses for the six months ended June 30, 2007, were
$10.7 million, an increase of 4.2% from the same period a year ago.
Compensation and benefits increased 5.4% due to cost of living increases and
rising health insurance costs, partially offset by a planned reduction in the
employee base. Processing and communications increased 3.1% due to increased
transactional volume due to a larger customer base. Loan servicing costs
increased $103 thousand due to collection expenses associated with past due
loans.
Total assets at June 30, 2007, were $732.4 million, a 9.2% increase from
June 30, 2006. The increase in assets from the prior year was primarily due
to growth in the Company's loan portfolio. Total loans at June 30, 2007, were
$541.4 million, an 11.7% increase from June 30, 2006. The growth in the loan
portfolio occurred in commercial, consumer and residential lending.
At June 30, 2007, the allowance for loan losses was $8.0 million, or 1.48%
of total loans, compared to 1.50% at December 31, 2006 and June 30, 2006.
Non-performing assets at June 30, 2007, were $5.0 million, or 0.92% of total
loans and other real estate owned, "OREO", a decline of $4.1 million in non
performing assets as compared to $9.1 million or 1.80% of total loans and OREO
at December 31, 2006, and an increase of $2.4 million in non performing, as
compared to $2.6 million or 0.53% of total loans and OREO from June 30, 2006.
Included in non-performing assets at June 30, 2007, are approximately $1.5
million of loans guaranteed by the SBA. Credit quality improved during the
quarter due to the resolution of certain problem credits.
Total deposits at June 30, 2007, were $596.1 million, a 3.4% increase from
June 30, 2006. This increase was primarily the result of growth in time
deposits and savings accounts, partially offset by the decline in interest
bearing checking accounts and demand deposit accounts. Savings accounts
increased $30.4 million, or 16.2% from June 30, 2006, due to a high-yield
savings product. Time deposits increased $28.7 million, or 15.1% from June
30, 2006, due to time deposit promotions.
"During the second quarter of 2007, the Company implemented remote deposit
capture. We believe this will increase the number of transactional
relationships inside and outside of our local market areas," said Mr. Hughes.
"In addition, we will be opening our sixteenth branch in the third quarter
2007. This will be our second office in the Lehigh Valley Pennsylvania area."
Total shareholders' equity was $48.2 million at June 30, 2007, an 11.0%
increase from June 30, 2006. The increase in shareholders' equity was
primarily due to retained profits and an increase in other comprehensive
income, partially offset by the payment of cash dividends and the purchase of
treasury stock. During the quarter, the Company took advantage of the
Company's reduced market valuation and purchased 78 thousand shares of
treasury stock.
As of June 30, 2007, the Company's Tier I leverage capital ratio was
9.28%, Tier I risk-based capital ratio was 11.12%, and total risk-based
capital ratio was 13.78%. All regulatory capital ratios exceeded the well-
capitalized, federal capital adequacy requirements as of June 30, 2007.
Unity Bancorp, Inc. is a financial service organization headquartered in
Clinton, New Jersey, with approximately $732 million in assets and $596
million in deposits. Unity Bank provides financial services to retail,
corporate and small business customers through its 15 retail service centers
located in Hunterdon, Middlesex, Somerset, Union and Warren Counties in New
Jersey and Northampton County, Pennsylvania. For additional information about
Unity, visit our website at www.unitybank.com, or call 800- 618-BANK.
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.
Unity Bancorp, Inc.
Consolidated Financial Highlights
(Dollars in thousands, except per share data)
Jun. 30, Mar. 31, Jun. 30, Jun. 07 vs.
2007 2007 2006 Mar. 07 Jun. 06
BALANCE SHEET DATA:
Assets $732,403 $681,302 $670,870 7.5 % 9.2 %
Deposits 596,093 541,399 576,376 10.1 3.4
Loans 541,385 515,562 484,622 5.0 11.7
Securities 102,730 104,318 108,979 (1.5) (5.7)
Shareholders' equity 48,242 47,825 43,446 0.9 11.0
Allowance for loan
losses 7,997 7,757 7,257 3.1 10.2
FINANCIAL DATA -
QUARTER TO DATE:
Net income before
taxes $2,218 $2,081 $2,429 6.6 % (8.7)%
Federal and state
income tax provision 676 630 792 7.3 (14.6)
Net income 1,542 1,451 1,637 6.3 (5.8)
Per share-basic 0.22 0.21 0.24 4.8 (8.3)
Per share-diluted 0.21 0.20 0.23 5.0 (8.7)
Return on average
assets 0.89 % 0.87 % 1.03 % 2.3 (13.6)
Return on average
common equity 13.14 12.74 15.39 3.1 (14.6)
Efficiency ratio 67.22 70.46 65.12 (4.6) 3.2
FINANCIAL DATA -
YEAR TO DATE:
Net income before
taxes $4,299 - $4,928 - (12.8)%
Federal and state
income tax provision 1,306 - 1,634 - (20.1)
Net income 2,993 - 3,294 - (9.1)
Per share-basic 0.43 - 0.48 - (10.4)
Per share-diluted 0.41 - 0.45 - (8.9)
Return on average
assets 0.88 % - 1.05 % - (16.2)
Return on average
common equity 12.94 - 15.82 - (18.2)
Efficiency ratio 68.83 - 65.19 - 5.6
SHARE INFORMATION:
Closing price per
share $11.45 $11.30 $14.75 1.4 % (22.4)%
Cash dividends
declared 0.05 0.05 0.05 - -
Book value per share 6.87 6.84 6.29 0.4 9.2
Average diluted shares
outstanding (QTD) 7,295 7,301 7,250 (0.1) 0.6
CAPITAL RATIOS:
Total equity to
total assets 6.59 % 7.02 % 6.48 % (6.1)% 1.7 %
Tier I capital to
average assets
(leverage) 9.28 9.24 8.22 0.4 12.9
Tier I capital to
risk-adjusted assets 11.12 11.43 9.85 (2.7) 12.9
Total risk-based
capital 13.78 14.21 11.10 (3.0) 24.1
CREDIT QUALITY AND
RATIOS:
Nonperforming assets $4,977 $6,771 $2,552 (26.5)% 95.0 %
Net charge offs to
average loans (QTD) 0.08 % 0.05 % 0.10 % 60.0 (20.0)
Allowance for loan
losses to total loans 1.48 1.50 1.50 (1.3) (1.3)
Nonperforming assets
to total loans and
OREO 0.92 1.31 0.53 (29.8) 73.6
Unity Bancorp, Inc.
Consolidated Balance Sheets
(In thousands)
Jun. 30, Mar. 31, Jun. 30, Jun. 07 vs.
2007 2007 2006 Mar. 07 Jun. 06
ASSETS
Cash and due from banks $14,696 $15,697 $13,709 (6.4)% 7.2 %
Federal funds sold and
interest bearing deposits 51,063 23,417 42,631 118.1 19.8
Securities:
Available for sale 66,199 66,197 68,104 - (2.8)
Held to maturity 36,531 38,121 40,875 (4.2) (10.6)
Total securities 102,730 104,318 108,979 (1.5) (5.7)
Loans:
SBA - Held for sale 8,914 9,298 24,384 (4.1) (63.4)
SBA - Held to Maturity 66,634 68,314 59,111 (2.5) 12.7
Commercial 342,328 318,905 297,826 7.3 14.9
Residential mortgage 69,417 63,615 55,966 9.1 24.0
Consumer 54,092 55,430 47,335 (2.4) 14.3
Total loans 541,385 515,562 484,622 5.0 11.7
Less: Allowance for loan
losses 7,997 7,757 7,257 3.1 10.2
Net loans 533,388 507,805 477,365 5.0 11.7
Goodwill and other
intangibles 1,596 1,599 1,611 (0.2) (0.9)
Premises and equipment,
net 11,614 11,525 10,954 0.8 6.0
Accrued interest
receivable 3,687 3,594 3,460 2.6 6.6
Loan servicing asset 2,289 2,261 2,424 1.2 (5.6)
Bank Owned Life Insurance 5,467 5,421 5,279 0.8 3.6
Other assets 5,873 5,665 4,458 3.7 31.7
Total Assets $732,403 $681,302 $670,870 7.5 % 9.2 %
LIABILITIES AND
SHAREHOLDERS' EQUITY
Deposits:
Noninterest-bearing
demand deposits $74,731 $75,928 $81,721 (1.6)% (8.6)%
Interest-bearing
deposits:
Interest bearing
checking 84,107 89,313 116,497 (5.8) (27.8)
Savings 218,273 214,636 187,841 1.7 16.2
Time, under $100,000 138,440 105,724 124,652 30.9 11.1
Time, $100,000 and
over 80,542 55,798 65,665 44.3 22.7
Total deposits 596,093 541,399 576,376 10.1 3.4
Borrowed funds and
subordinated debentures 84,744 89,744 49,279 (5.6) 72.0
Accrued interest payable 595 523 313 13.8 90.1
Accrued expenses and other
liabilities 2,729 1,811 1,456 50.7 87.4
Total liabilities 684,161 633,477 627,424 8.0 9.0
Commitments and
Contingencies - - -
Shareholders' equity:
Common stock, no par
value, 12,500 shares
authorized 49,087 44,677 43,866 9.9 11.9
Retained earnings 1,435 4,067 1,555 (64.7) (7.7)
Treasury stock at cost (1,121) (242) (242) 363.2 363.2
Accumulated other
comprehensive loss, net
of tax (1,159) (677) (1,733) 71.2 (33.1)
Total shareholders'
equity 48,242 47,825 43,446 0.9 11.0
Total Liabilities and
Shareholders' Equity $732,403 $681,302 $670,870 7.5 % 9.2 %
COMMON SHARES AT PERIOD
END:
Issued 7,122 7,019 6,932
Outstanding 7,020 6,995 6,908
Treasury 102 24 24
N/M= Not meaningful
Unity Bancorp, Inc.
Consolidated Statements of Income
(In thousands, except per share data)
Jun. 30, Mar. 31, Jun. 30, Jun. 07 vs.
FOR THE THREE MONTHS ENDED: 2007 2007 2006 Mar. 07 Jun. 06
INTEREST INCOME
Fed funds sold and interest on
deposits $221 $262 $354 (15.6)% (37.6)%
Securities:
Available for sale 778 780 709 (0.3) 9.7
Held to maturity 478 540 467 (11.5) 2.4
Total securities 1,256 1,320 1,176 (4.8) 6.8
Loans:
SBA 2,202 2,340 2,179 (5.9) 1.1
Commercial 6,378 5,988 5,368 6.5 18.8
Residential mortgage 967 888 788 8.9 22.7
Consumer 951 904 779 5.2 22.1
Total loan interest income 10,498 10,120 9,114 3.7 15.2
Total interest income 11,975 11,702 10,644 2.3 12.5
INTEREST EXPENSE
Interest bearing demand deposits 477 552 653 (13.6) (27.0)
Savings deposits 2,122 2,171 1,704 (2.3) 24.5
Time deposits 2,153 1,970 1,671 9.3 28.8
Borrowed funds and subordinated
debentures 1,136 990 583 14.7 94.9
Total interest expense 5,888 5,683 4,611 3.6 27.7
Net interest income 6,087 6,019 6,033 1.1 0.9
Provision for loan losses 350 200 250 75.0 40.0
Net interest income after
provision for loan losses 5,737 5,819 5,783 (1.4) (0.8)
NONINTEREST INCOME
Service charges on deposit
accounts 339 349 409 (2.9) (17.1)
Service and loan fee income 380 366 406 3.8 (6.4)
Gain on SBA loan sales 824 679 558 21.4 47.7
Gain on Mortgage loan sales 19 9 110 111.1 (82.7)
Gain on sales of other loans - - - - (100.0)
Bank owned life insurance 46 49 47 (6.1) (2.1)
Net securities gains - 10 - 100.0 100.0
Other income 140 217 117 (35.5) 19.7
Total noninterest income 1,748 1,679 1,647 4.1 6.1
NONINTEREST EXPENSES
Compensation and benefits 2,723 2,955 2,664 (7.9) 2.2
Processing and communications 563 550 553 2.4 1.8
Occupancy, net 644 673 646 (4.3) (0.3)
Furniture and equipment 394 400 381 (1.5) 3.4
Professional fees 162 136 151 19.1 7.3
Loan servicing costs 169 90 55 87.8 207.3
Advertising 105 94 148 11.7 (29.1)
Other 507 519 403 (2.3) 25.8
Total noninterest expenses 5,267 5,417 5,001 (2.8) 5.3
Income before taxes 2,218 2,081 2,429 6.6 (8.7)
Federal and state income tax
provision 676 630 792 7.3 (14.6)
Net Income $1,542 $1,451 $1,637 6.3 % (5.8)%
Net Income Per Common Share-
Basic $0.22 $0.21 $0.24 4.8 % (8.3)%
Net Income Per Common Share-
Diluted $0.21 $0.20 $0.23 5.0 % (8.7)%
AVERAGE COMMON SHARES
OUTSTANDING:
Basic 6,985 6,976 6,903
Diluted 7,295 7,301 7,250
Unity Bancorp, Inc.
Consolidated Statements of Income
(Dollars in thousands, except per share data)
Jun. 30, Jun. 30, Jun. 07 vs.
YEAR TO DATE 2007 2006 Jun. 06
INTEREST INCOME
Fed funds sold and interest on deposits $483 $561 (13.9)%
Securities:
Available for sale 1,558 1,417 10.0
Held to maturity 1,018 943 8.0
Total securities 2,576 2,360 9.2
Loans:
SBA 4,542 4,332 4.8
Commercial 12,366 10,260 20.5
Residential mortgage 1,855 1,608 15.4
Consumer 1,855 1,523 21.8
Total loan interest income 20,618 17,723 16.3
Total interest income 23,677 20,644 14.7
INTEREST EXPENSE
Interest bearing demand deposits 1,029 1,347 (23.6)
Savings deposits 4,293 2,896 48.2
Time deposits 4,123 3,170 30.1
Borrowed funds and subordinated
debentures 2,126 1,145 85.7
Total interest expense 11,571 8,558 35.2
Net interest income 12,106 12,086 0.2
Provision for loan losses 550 550 0.0
Net interest income after
provision for loan losses 11,556 11,536 0.2
NONINTEREST INCOME
Service charges on deposit accounts 688 842 (18.3)
Service and loan fee income 746 801 (6.9)
Gain on SBA loan sales 1,503 1,258 19.5
Gain on Mortgage loan sales 28 172 (83.7)
Gains on sales of other loans 0 82 (100.0)
Bank owned life insurance 95 94 1.1
Net securities gains 10 - 100.0
Other income 357 400 (10.8)
Total noninterest income 3,427 3,649 (6.1)
NONINTEREST EXPENSES
Compensation and benefits 5,678 5,389 5.4
Processing and communications 1,113 1,080 3.1
Occupancy, net 1,317 1,294 1.8
Furniture and equipment 794 774 2.6
Professional fees 298 283 5.3
Loan servicing costs 259 156 66.0
Advertising 199 318 (37.4)
Other 1,026 963 6.5
Total noninterest expenses 10,684 10,257 4.2
Income before taxes 4,299 4,928 (12.8)
Federal and state income tax
provision 1,306 1,634 (20.1)
Net Income $2,993 $3,294 (9.1)%
Net Income Per Common Share-Basic $0.43 $0.48 (10.4)%
Net Income Per Common Share-Diluted $0.41 $0.45 (8.9)%
Average common shares outstanding:
Basic 6,981 6,893
Diluted 7,298 7,246
Unity Bancorp, Inc.
Consolidated Average Balance Sheets
with Resultant Interest and Rates
(Tax-equivalent basis, dollars in thousands)
Three Months Ended
June 30, 2007 March 31, 2007
Balance Interest Rate Balance Interest Rate
ASSETS
Interest-earning
assets:
Federal funds sold
and interest-
bearing deposits
with banks $19,029 $221 4.66 % $20,650 $262 5.15 %
Securities:
Available for sale 65,132 790 4.85 64,905 792 4.88
Held to maturity 37,501 496 5.29 42,287 558 5.28
Total
securities 102,633 1,286 5.01 107,192 1,350 5.04
Loans, net of
unearned
discount:
SBA 83,080 2,202 10.60 81,783 2,340 11.44
Commercial 335,081 6,378 7.63 318,638 5,988 7.62
Residential
mortgage 65,256 967 5.93 62,903 888 5.65
Consumer 55,227 951 6.91 53,419 904 6.86
Total loans 538,644 10,498 7.81 516,743 10,120 7.91
Total interest-
earning assets 660,306 12,005 7.28 644,585 11,732 7.34
Noninterest-earning
assets:
Cash and due from
banks 12,170 12,228
Allowance for loan
losses (8,022) (7,877)
Other assets 29,092 29,495
Total
noninterest-
earning
assets 33,240 33,846
Total Assets $693,546 $678,431
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Interest-bearing
liabilities:
Interest-bearing
demand deposits $84,729 477 2.26 $97,570 552 2.29
Savings deposits 211,478 2,122 4.02 210,879 2,171 4.18
Time deposits 184,727 2,153 4.67 170,508 1,970 4.69
Total
interest-
bearing
deposits 480,934 4,752 3.96 478,957 4,693 3.97
Borrowed funds and
subordinated
debentures 87,815 1,136 5.19 75,133 990 5.34
Total
interest-
bearing
liabilities 568,749 5,888 4.15 554,090 5,683 4.16
Noninterest-bearing
liabilities:
Demand deposits 75,469 75,222
Other liabilities 2,262 2,927
Total
noninterest-
bearing
liabilities 77,731 78,149
Shareholders'
equity 47,066 46,192
Total Liabilities
and Shareholders'
Equity $693,546 $678,431
Net interest spread 6,117 3.13 % 6,049 3.18 %
Tax-equivalent basis
adjustment (30) (30)
Net interest income $6,087 $6,019
Net interest margin 3.71 % 3.75 %
Unity Bancorp, Inc.
Consolidated Average Balance Sheets
with Resultant Interest and Rates
(Tax-equivalent basis, dollars in thousands)
Three Months Ended
June 30, 2007 June 30, 2006
Balance Interest Rate Balance Interest Rate
ASSETS
Interest-earning
assets:
Federal funds sold
and interest-
bearing deposits
with banks $19,029 $221 4.66 % $30,005 $354 4.73 %
Securities:
Available for sale 65,132 790 4.85 62,831 722 4.60
Held to maturity 37,501 496 5.29 38,283 467 4.88
Total
securities 102,633 1,286 5.01 101,114 1,189 4.70
Loans, net of
unearned discount:
SBA 83,080 2,202 10.60 83,708 2,179 10.41
Commercial 335,081 6,378 7.63 286,943 5,368 7.50
Residential
mortgage 65,256 967 5.93 58,135 788 5.42
Consumer 55,227 951 6.91 46,690 779 6.69
Total loans 538,644 10,498 7.81 475,476 9,114 7.68
Total interest-
earning assets 660,306 12,005 7.28 606,595 10,657 7.04
Noninterest-earning
assets:
Cash and due from
banks 12,170 12,535
Allowance for loan
losses (8,022) (7,478)
Other assets 29,092 28,355
Total
noninterest-
earning assets 33,240 33,412
Total Assets $693,546 $640,007
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Interest-bearing
liabilities:
Interest-bearing
demand deposits $84,729 477 2.26 $116,303 653 2.25
Savings deposits 211,478 2,122 4.02 184,168 1,704 3.71
Time deposits 184,727 2,153 4.67 167,245 1,671 4.01
Total
interest-
bearing
deposits 480,934 4,752 3.96 467,716 4,028 3.45
Borrowed funds and
subordinated
debentures 87,815 1,136 5.19 49,279 583 4.75
Total
interest-
bearing
liabilities 568,749 5,888 4.15 516,995 4,611 3.58
Noninterest-bearing
liabilities:
Demand deposits 75,469 78,764
Other liabilities 2,262 1,589
Total
noninterest-
bearing
liabilities 77,731 80,353
Shareholders'
equity 47,066 42,659
Total Liabilities
and Shareholders'
Equity $693,546 $640,007
Net interest spread 6,117 3.13 % 6,046 3.46 %
Tax-equivalent basis
adjustment (30) (13)
Net interest income $6,087 $6,033
Net interest margin 3.71 % 3.99 %
Unity Bancorp, Inc.
Consolidated Average Balance Sheets
with Resultant Interest and Rates
(Tax-equivalent basis, dollars in thousands)
Year to Date
June 30, 2007 June 30, 2006
Balance Interest Rate Balance Interest Rate
ASSETS
Interest-earning
assets:
Federal funds sold
and interest-
bearing deposits
with banks $19,835 $483 4.91 % $24,778 $561 4.57 %
Securities:
Available for sale 65,019 1,582 4.87 63,816 1,443 4.52
Held to maturity 39,881 1,054 5.29 38,784 943 4.86
Total securities 104,900 2,636 5.03 102,600 2,386 4.65
Loans, net of
unearned discount:
SBA 82,435 4,542 11.02 84,813 4,332 10.22
Commercial 326,905 12,366 7.63 279,176 10,260 7.41
Residential
mortgage 64,086 1,855 5.79 59,622 1,608 5.39
Consumer 54,328 1,855 6.89 46,596 1,523 6.59
Total loans 527,754 20,618 7.86 470,207 17,723 7.58
Total interest-
earning assets 652,489 23,737 7.32 597,585 20,670 6.95
Noninterest-earning
assets:
Cash and due from
banks 12,199 12,119
Allowance for loan
losses (7,950) (7,317)
Other assets 29,292 27,605
Total
noninterest-
earning assets 33,541 32,407
Total Assets $686,030 $629,992
LIABILITIES AND
SHAREHOLDERS' EQUITY
Interest-bearing
liabilities:
Interest-bearing
demand deposits $91,114 1,029 2.28 $122,194 1,347 2.22
Savings deposits 211,180 4,293 4.10 171,185 2,896 3.41
Time deposits 177,657 4,123 4.68 164,902 3,170 3.88
Total interest-
bearing
deposits 479,951 9,445 3.97 458,281 7,413 3.26
Borrowed funds and
subordinated
debentures 81,509 2,126 5.26 49,279 1,145 4.69
Total interest-
bearing
liabilities 561,460 11,571 4.16 507,560 8,558 3.40
Noninterest-bearing
liabilities:
Demand deposits 75,346 78,473
Other liabilities 2,593 1,961
Total
noninterest-
bearing
liabilities 77,939 80,434
Shareholders' equity 46,631 41,998
Total Liabilities and
Shareholders' Equity $686,030 $629,992
Net interest spread 12,166 3.16 % 12,112 3.55 %
Tax-equivalent basis
adjustment (60) (26)
Net interest income $12,106 $12,086
Net interest margin 3.73 % 4.05 %
Unity Bancorp, Inc.
Allowance for Loan Losses and Loan Quality Schedules
(Dollars in thousands)
06/30/ 03/31/ 12/31/ 09/30/ 06/30/
2007 2007 2006 2006 2006
ALLOWANCE FOR LOAN
LOSSES:
Balance, beginning $7,757 $7,624 $7,480 $7,257 $7,120
Provision charged to
expense 350 200 600 400 250
8,107 7,824 8,080 7,657 7,370
Less: Charge offs
SBA 124 116 320 141 66
Commercial 5 - 196 50 48
Residential mortgage - - - - -
Consumer - 2 10 3 14
Total Charge Offs 129 118 526 194 128
Add: Recoveries
SBA 12 41 20 - -
Commercial 2 6 50 12 2
Residential mortgage - - - - -
Consumer 5 4 - 5 13
Total Recoveries 19 51 70 17 15
Net Charge Offs 110 67 456 177 113
Balance, ending $7,997 $7,757 $7,624 $7,480 $7,257
LOAN QUALITY
INFORMATION:
Nonperforming loans $4,611 $6,515 $8,909 $6,473 $2,552
Other real estate owned,
net 366 256 211 - -
Nonperforming assets $4,977 $6,771 $9,120 $6,473 $2,552
Loans 90 days past due
and still accruing $167 $145 $78 $658 $-
Allowance for loan
losses to:
Total loans at period
end 1.48 % 1.50 % 1.50 % 1.50 % 1.50 %
Nonperforming loans 173.43 119.06 85.58 115.56 284.37
Nonperforming assets 160.68 114.56 83.60 115.56 284.37
Net charge offs to
average loans (QTD) 0.08 0.05 0.35 0.14 0.10
Net charge offs to
average loans (YTD) 0.07 0.05 0.17 0.10 0.08
Nonperforming loans to
total loans 0.85 1.26 1.75 1.30 0.53
Nonperforming assets to
total loans and OREO 0.92 1.31 1.80 1.30 0.53
Unity Bancorp, Inc.
Quarterly Financial Data
06/30/07 03/31/07 12/31/06 09/30/06 06/30/06
SUMMARY OF INCOME (in
thousands) :
Interest income $11,975 $11,702 $11,275 $11,258 $10,644
Interest expense 5,888 5,683 5,560 5,314 4,611
Net interest income 6,087 6,019 5,715 5,944 6,033
Provision for loan losses 350 200 600 400 250
Net interest income after
provision 5,737 5,819 5,115 5,544 5,783
Noninterest income 1,748 1,679 1,746 2,243 1,647
Noninterest expense 5,267 5,417 5,472 5,316 5,001
Income before income taxes 2,218 2,081 1,389 2,471 2,429
Federal and state income tax
provision 676 630 465 844 792
Net Income 1,542 1,451 924 1,627 1,637
Net Income per Common Share:
Before non-recurring
items:
Basic $0.22 $0.21 $0.13 $0.24 $0.24
Diluted 0.21 0.20 0.13 0.22 0.23
COMMON SHARE DATA:
Cash dividends declared $0.05 $0.05 $0.05 $0.05 $0.05
Book value at quarter end 6.87 6.84 6.65 6.59 6.29
Market value at quarter end 11.45 11.30 14.01 14.55 14.75
Average common shares
outstanding: (000's)
Basic 6,985 6,976 6,941 6,921 6,903
Diluted 7,295 7,301 7,263 7,271 7,250
Common shares outstanding at
period end (000's) 7,020 6,995 6,949 6,930 6,908
OPERATING RATIOS:
Return on average assets 0.89% 0.87% 0.55% 1.00% 1.03%
Return on average common
equity 13.14 12.74 8.05 15.26 15.39
Efficiency ratio 67.22 70.46 73.34 65.48 65.12
BALANCE SHEET DATA (in
thousands):
Assets $732,403 $681,302 $694,106 $671,811 $670,870
Deposits 596,093 541,399 566,465 557,451 576,376
Loans 541,385 515,562 507,690 498,842 484,622
Shareholders' equity 48,242 47,825 46,228 45,643 43,446
Allowance for loan losses 7,997 7,757 7,624 7,480 7,257
TAX-EQUIVALENT YIELDS AND
RATES:
Interest-earning assets 7.28% 7.34% 7.05% 7.13% 7.04%
Interest-bearing liabilities 4.15 4.16 4.03 3.87 3.58
Net interest spread 3.13 3.18 3.02 3.26 3.46
Net interest margin 3.71 3.75 3.60 3.79 3.99
CREDIT QUALITY:
Nonperforming assets (in
thousands) $4,977 $6,771 $9,120 $6,473 $2,552
Allowance for loan losses to
period-end loans 1.48% 1.50% 1.50% 1.50% 1.50%
Net charge offs to average
loans 0.08 0.05 0.35 0.14 0.10
Nonperforming assets to loans
and OREO 0.92 1.31 1.80 1.30 0.53
CAPITAL AND OTHER:
Total equity to assets 6.59% 7.02% 6.66% 6.79% 6.48%
Tier I capital to average
assets (leverage) 9.28 9.24 9.13 9.12 8.22
Tier I capital to risk-
adjusted assets 11.12 11.43 10.92 10.92 9.85
Total capital to risk-
adjusted assets 13.78 14.21 13.72 12.91 11.10
Number of banking offices 15 15 15 14 14
Number of ATMs 18 18 18 17 17
Number of employees 195 179 185 205 191
Unity Bancorp, Inc. is a financial service organization headquartered in
Clinton, New Jersey, with $732 million in assets and $596 million in deposits.
Unity Bank provides financial services to retail, corporate & small business
customers through its 15 retail service centers located in Hunterdon,
Middlesex, Somerset, Union and Warren counties in New Jersey and Northampton
county in Pennsylvania. For additional information about Unity visit our
website at www.unitybank.com or call (800) 618-BANK.
This letter 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.
SOURCE Unity Bancorp, Inc.
Contact: Alan J. Bedner, EVP, Chief Financial Officer of Unity Bancorp, Inc., +1-908-713-4308