United Bancorp Inc. (UBCP, Financial) filed Quarterly Report for the period ended 2010-09-30.
United Bancorp Inc. has a market cap of $44.7 million; its shares were traded at around $8.45 with a P/E ratio of 14.1 and P/S ratio of 1.7. The dividend yield of United Bancorp Inc. stocks is 6.7%. United Bancorp Inc. had an annual average earning growth of 1.4% over the past 10 years.
The Company s earnings in the nine months ended September 30, 2010 generated an annualized 0.63% return on average assets (“ROA”) and a 7.74% return on average equity (“ROE”), compared to 0.62% ROA and 8.21% ROE for the nine months ended September 30, 2009. Comparing the nine months ended September 30, 2010 to 2009, the Company s net interest margin was 3.94% compared to 3.83%, an increase of 11 basis points. Although the net interest margin increased, the Company s net interest income decreased by approximately $158,000 or 1.4%, due to a decrease in the Company s earning assets. At September 30, 2010, the Company had approximately $41 million of liquidity in cash and cash equivalents to fund our future loan demand. With this high level of available funding, the Company has not been aggressive in the retention of higher cost deposit funding, mainly certificates of deposit. While this has resulted in a decrease in the earning assets of the Bank, it increased the net interest margin of the Company since the cost reduction of the certificates of deposit exceeded the rate of return on the cash and cash equivalents of the Company. Comparing the same periods, customer service charges on deposits increased $47,000. On the expense side, total noninterest expense increased $233,000 for the nine months ended September 30, 2010 as compared to 2009. The increase in total noninterest expense was primarily due to the third quarter 2010 implementation of our new data processing system. The Company incurred approximately $184,000 in direct expenses related to this new system, which is non-recurring. In addition, the Company incurred a $70,000 period-over-period increase in losses on foreclosed real estate due to additional write-downs that were taken and a period-over-period increase of $55,000 in our provision for loan losses. The increase in the provision for loan losses for the nine months ended September 30, 2010 was predicated primarily upon the economic challenges facing the banking industry. Asset quality improved in the current period with an 18.3% reduction in non-performing loans. During the third quarter of 2010, the Company recognized a tax benefit resulting from the resolution of a tax contingency, which reduced federal income taxes by approximately $120,000.
The Company s primary source of funds is core deposits from retail and business customers. These core deposits include all categories of interest-bearing and noninterest-bearing deposits, excluding certificates of deposit greater than $100,000. For the period ended September 30, 2010, total core deposits increased approximately $1.3 million, or less than 1.0%. The Company s savings accounts increased $6.4 million, or 14.0%, from December 31, 2009 totals. The Company s interest-bearing demand deposits increased $5.1 million, or 4.7%, noninterest-bearing demand deposits increased $2.2 million, or 9.7%, while certificates of deposit under $100,000 decreased by $12.4 million, or 10.6%.
Basic and diluted earnings per share for the nine months ended September 30, 2010 totaled $0.43 compared with $0.48 for the nine months ended September 30, 2009. In dollars, the Company s net income was $2,094,000 for the nine months ended September 30, 2010, a decrease of $136,000, or 6.1% compared with net income of $2,230,000 for the same period in 2009.
Noninterest expense was $10,529,000 for the nine months ended September 30, 2010 an increase of $233,000, or 2.3%, compared to the nine months ended September 30, 2009. Salaries and employee benefits expense increased $309,000, or 6.2%, for the period ended September 30, 2010 over the same period in 2009. This increase was primarily due to the expansion of the Company s management team in preparation for the previously announced management succession plan, plus normal merit increases, increase in benefit costs and restricted stock award expenses. During the third quarter of 2009, the Company issued restricted stock awards to certain officers and directors. Occupancy and equipment expense increased $53,000, or 4.3% for the nine months ended September 30, 2010 as compared to the same period in 2009. Increased depreciation expense on premises, computer hardware and software and related service maintenance was the primary reason for the increase. Professional fees increased $42,000 for the nine month ended September 30, 2010, as compared to the same period in 2009. Deposit insurance premiums decreased $306,000 for the nine months ended September 30, 2010, as compared to the same period in 2009. In the second quarter of September 2009, the Federal Deposit Insurance Corporation imposed a 5 basis point assessment on all FDIC insured banks. This special assessment was approximately $225,000 and was expensed in the second quarter of 2009. The Company incurred $184,000 in direct expenses related to the core processing conversion, which is non-recurring. In addition, the Company incurred a $70,000 period-over-period increase in losses on foreclosed real estate due to additional write-downs.
Noninterest expense was $3,687,000 for the three months ended September 30, 2010 an increase of $267,000, or 7.8%, compared to the three months ended September 30, 2009. Salaries and employee benefit expense increased $74,000, or 4.4%, for the three month period ended September 30, 2010 over the same period in 2009. This increase was primarily due to the expansion of the Company s management team in preparation for the previously announced management succession plan, plus normal merit increases, increase in benefits costs and restricted stock award expenses. During the third quarter of 2009, the Company issued restricted stock awards to certain officers and directors. Occupancy and equipment expense increased $9,000 for the three months ended September 30, 2010 over the same period in 2009. Increased depreciation expense on premises, computer hardware and software and related service maintenance was the primary reason for the increase. Deposit insurance premiums decreased $87,000 for the three months ended September 30, 2010, as compared to the same period in 2009. The Company incurred $184,000 in direct expenses related to the core data processing conversion, which is non-recurring. In addition, the Company incurred a $70,000 period-over-period increase in losses on foreclosed real estate due to additional write-downs.
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United Bancorp Inc. has a market cap of $44.7 million; its shares were traded at around $8.45 with a P/E ratio of 14.1 and P/S ratio of 1.7. The dividend yield of United Bancorp Inc. stocks is 6.7%. United Bancorp Inc. had an annual average earning growth of 1.4% over the past 10 years.
Highlight of Business Operations:
The Company reported net income of $710,000 for the quarter ended September 30, 2010, compared to $757,000 for the quarter ended September 30, 2009, a decrease of 6.2%. On a per share basis, the Company s three months diluted earnings were $0.15 for the 2010 period, as compared to $0.16 for the same period in 2009. For the nine months ended September 30, 2010 the Company reported net income of $2,094,000, compared to $2,230,000 for the nine months ended September 30, 2009, a decrease of $136,000 or 6.1%. On a per share basis, the Company s nine months diluted earnings were $0.43 for 2010, as compared to $0.48 for 2009.The Company s earnings in the nine months ended September 30, 2010 generated an annualized 0.63% return on average assets (“ROA”) and a 7.74% return on average equity (“ROE”), compared to 0.62% ROA and 8.21% ROE for the nine months ended September 30, 2009. Comparing the nine months ended September 30, 2010 to 2009, the Company s net interest margin was 3.94% compared to 3.83%, an increase of 11 basis points. Although the net interest margin increased, the Company s net interest income decreased by approximately $158,000 or 1.4%, due to a decrease in the Company s earning assets. At September 30, 2010, the Company had approximately $41 million of liquidity in cash and cash equivalents to fund our future loan demand. With this high level of available funding, the Company has not been aggressive in the retention of higher cost deposit funding, mainly certificates of deposit. While this has resulted in a decrease in the earning assets of the Bank, it increased the net interest margin of the Company since the cost reduction of the certificates of deposit exceeded the rate of return on the cash and cash equivalents of the Company. Comparing the same periods, customer service charges on deposits increased $47,000. On the expense side, total noninterest expense increased $233,000 for the nine months ended September 30, 2010 as compared to 2009. The increase in total noninterest expense was primarily due to the third quarter 2010 implementation of our new data processing system. The Company incurred approximately $184,000 in direct expenses related to this new system, which is non-recurring. In addition, the Company incurred a $70,000 period-over-period increase in losses on foreclosed real estate due to additional write-downs that were taken and a period-over-period increase of $55,000 in our provision for loan losses. The increase in the provision for loan losses for the nine months ended September 30, 2010 was predicated primarily upon the economic challenges facing the banking industry. Asset quality improved in the current period with an 18.3% reduction in non-performing loans. During the third quarter of 2010, the Company recognized a tax benefit resulting from the resolution of a tax contingency, which reduced federal income taxes by approximately $120,000.
The Company s primary source of funds is core deposits from retail and business customers. These core deposits include all categories of interest-bearing and noninterest-bearing deposits, excluding certificates of deposit greater than $100,000. For the period ended September 30, 2010, total core deposits increased approximately $1.3 million, or less than 1.0%. The Company s savings accounts increased $6.4 million, or 14.0%, from December 31, 2009 totals. The Company s interest-bearing demand deposits increased $5.1 million, or 4.7%, noninterest-bearing demand deposits increased $2.2 million, or 9.7%, while certificates of deposit under $100,000 decreased by $12.4 million, or 10.6%.
Basic and diluted earnings per share for the nine months ended September 30, 2010 totaled $0.43 compared with $0.48 for the nine months ended September 30, 2009. In dollars, the Company s net income was $2,094,000 for the nine months ended September 30, 2010, a decrease of $136,000, or 6.1% compared with net income of $2,230,000 for the same period in 2009.
Noninterest expense was $10,529,000 for the nine months ended September 30, 2010 an increase of $233,000, or 2.3%, compared to the nine months ended September 30, 2009. Salaries and employee benefits expense increased $309,000, or 6.2%, for the period ended September 30, 2010 over the same period in 2009. This increase was primarily due to the expansion of the Company s management team in preparation for the previously announced management succession plan, plus normal merit increases, increase in benefit costs and restricted stock award expenses. During the third quarter of 2009, the Company issued restricted stock awards to certain officers and directors. Occupancy and equipment expense increased $53,000, or 4.3% for the nine months ended September 30, 2010 as compared to the same period in 2009. Increased depreciation expense on premises, computer hardware and software and related service maintenance was the primary reason for the increase. Professional fees increased $42,000 for the nine month ended September 30, 2010, as compared to the same period in 2009. Deposit insurance premiums decreased $306,000 for the nine months ended September 30, 2010, as compared to the same period in 2009. In the second quarter of September 2009, the Federal Deposit Insurance Corporation imposed a 5 basis point assessment on all FDIC insured banks. This special assessment was approximately $225,000 and was expensed in the second quarter of 2009. The Company incurred $184,000 in direct expenses related to the core processing conversion, which is non-recurring. In addition, the Company incurred a $70,000 period-over-period increase in losses on foreclosed real estate due to additional write-downs.
Noninterest expense was $3,687,000 for the three months ended September 30, 2010 an increase of $267,000, or 7.8%, compared to the three months ended September 30, 2009. Salaries and employee benefit expense increased $74,000, or 4.4%, for the three month period ended September 30, 2010 over the same period in 2009. This increase was primarily due to the expansion of the Company s management team in preparation for the previously announced management succession plan, plus normal merit increases, increase in benefits costs and restricted stock award expenses. During the third quarter of 2009, the Company issued restricted stock awards to certain officers and directors. Occupancy and equipment expense increased $9,000 for the three months ended September 30, 2010 over the same period in 2009. Increased depreciation expense on premises, computer hardware and software and related service maintenance was the primary reason for the increase. Deposit insurance premiums decreased $87,000 for the three months ended September 30, 2010, as compared to the same period in 2009. The Company incurred $184,000 in direct expenses related to the core data processing conversion, which is non-recurring. In addition, the Company incurred a $70,000 period-over-period increase in losses on foreclosed real estate due to additional write-downs.
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