Monarch Community Bancorp Inc. (MCBF, Financial) filed Quarterly Report for the period ended 2010-03-31.
Monarch Community Bancorp Inc. has a market cap of $3.03 million; its shares were traded at around $1.48 with and P/S ratio of 0.15.
Total deposits increased $5.0 million, or 2.4%, from $213.4 million at December 31, 2009 to $218.4 million at March 31, 2010. This growth included increases of $2.8 million in money market deposits, $2.8 million in savings and checking deposits and $2.2 million in local certificates of deposit. The Bank continues to be committed to increasing its core deposit balances during 2010. Brokered deposits decreased $2.8 million as management continues to try to reduce its reliance on wholesale funding. The increase in local certificates of deposits and money market accounts is largely due to managements efforts to remain competitive with interest rates in these categories of deposits. The increase in money market accounts has provided funding so it has not been necessary for management to borrow additional FHLB advances or increase brokered deposits. Brokered deposits have been managed to provide additional liquidity or reduce excess liquidity depending on current conditions. Management expects future deposit growth to come from increased sales and marketing efforts to attract lower cost savings and checking accounts as well as product enhancement.
Total equity was $21.8 million at March 31, 2010 compared to $23.2 million at December 31, 2009. This represents 7.6% and 8.2% of total assets at March 31, 2010 and December 31, 2009, respectively. Decreases in equity for the three months ended March 31, 2010 included a net loss of $1.2 million and $84,000 in accrued dividend payments on the Preferred stock. The annual 5% dividend on the Preferred Stock together with the amortization of the discount will reduce net income (or increase the net loss) applicable to common stock by approximately $350,000 annually.
Fees and service charges, also included in non-interest income, increased $31,000 as a result of a $25,000 increase in loan related fees (from $96,000 to $121,000) and a $6,000 increase in deposit related fees (from $418,000 to $424,000). The increase in loan related fees was a result of $25,000 in loan brokerage fees. The increase in deposit related fees was a result of a $13,000 increase in ATM/Debit Card income and an increase of $2,000 in other fees, offset by a $9,000 decrease in NSF fees.
Noninterest expense decreased $17,000, or .70%, for the three months ended March 31, 2010 compared to the same period ending a year ago. Salaries and employee benefits decreased $43,000. Amortization of mortgage servicing rights decreased $111,000 as a result of the slow down in residential mortgage refinancing activity mentioned previously. Other operating expenses decreased $24,000. Foreclosed property expense increased $174,000 due to increases in taxes, maintenance costs, and loan collection costs associated with the maintaining and disposition of other real estate. Professional services increased $21,000 primarily due to increases in legal fees associated with non-performing loans.
The Banks total cash and cash equivalents increased by $8.4 million during the three months ended March 31, 2010 compared to a $11.9 million increase for the same period in 2009. The primary sources of cash for the three months ended March 31, 2010 were$5.0 million increase in deposits, $6.4 million in proceeds from the sale of mortgage loans, $2.9 million in sales and maturities of available-for-sale investment securities and $2.3 of principal loan collections in excess of loan originations compared to $6.8 million increase in cash generated by the issuance of preferred stock, $9.1 million increase in deposits, $34.3 million in proceeds from the sale of mortgage loans, $2.6 million in maturities of available-for-sale investment securities. The primary uses of cash for the three months ended March 31, 2010 were $6.1 million of mortgage loans originated for sale and $3.7 million in purchases of available-for-sale investment securities compared to $35.0 million of mortgage loans originated for sale, $3.5 million in repayments of FHLB advances, $1.0 million in repayment of Fed funds purchased and $8.6 million in purchases of available-for-sale investment securities.
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Monarch Community Bancorp Inc. has a market cap of $3.03 million; its shares were traded at around $1.48 with and P/S ratio of 0.15.
Highlight of Business Operations:
The allowance for loan losses was $6.3 million at March 31, 2010 compared to $5.8 million at December 31, 2009, an increase of $500,000. The increase was necessitated by the increases in net charge offs and nonperforming assets which are directly related to the continued overall weakness in the Michigan economy. Net charge offs totaled $1.4 million compared to $230,000 for the same period a year ago. Net charge offs year to date consisted of 68% construction loans, 27% one to four family residential mortgages, 1.5% commercial real estate, 2.3% consumer and the remaining 1.2% included commercial and industrial and home equity lines of credit. See Provision for Loan Losses below for further explanation regarding charge-offs and non-performing loans. We continue to be diligent in review of our loan portfolios for problem loans and believe that early detection of troubled credits is critical. We maintain the allowance for loan losses at a level considered adequate to cover losses within the loan portfolio. The allowance balance is established after considering past loan loss experience, current economic conditions, composition of the loan portfolio, delinquencies, and other relevant factors.Total deposits increased $5.0 million, or 2.4%, from $213.4 million at December 31, 2009 to $218.4 million at March 31, 2010. This growth included increases of $2.8 million in money market deposits, $2.8 million in savings and checking deposits and $2.2 million in local certificates of deposit. The Bank continues to be committed to increasing its core deposit balances during 2010. Brokered deposits decreased $2.8 million as management continues to try to reduce its reliance on wholesale funding. The increase in local certificates of deposits and money market accounts is largely due to managements efforts to remain competitive with interest rates in these categories of deposits. The increase in money market accounts has provided funding so it has not been necessary for management to borrow additional FHLB advances or increase brokered deposits. Brokered deposits have been managed to provide additional liquidity or reduce excess liquidity depending on current conditions. Management expects future deposit growth to come from increased sales and marketing efforts to attract lower cost savings and checking accounts as well as product enhancement.
Total equity was $21.8 million at March 31, 2010 compared to $23.2 million at December 31, 2009. This represents 7.6% and 8.2% of total assets at March 31, 2010 and December 31, 2009, respectively. Decreases in equity for the three months ended March 31, 2010 included a net loss of $1.2 million and $84,000 in accrued dividend payments on the Preferred stock. The annual 5% dividend on the Preferred Stock together with the amortization of the discount will reduce net income (or increase the net loss) applicable to common stock by approximately $350,000 annually.
Fees and service charges, also included in non-interest income, increased $31,000 as a result of a $25,000 increase in loan related fees (from $96,000 to $121,000) and a $6,000 increase in deposit related fees (from $418,000 to $424,000). The increase in loan related fees was a result of $25,000 in loan brokerage fees. The increase in deposit related fees was a result of a $13,000 increase in ATM/Debit Card income and an increase of $2,000 in other fees, offset by a $9,000 decrease in NSF fees.
Noninterest expense decreased $17,000, or .70%, for the three months ended March 31, 2010 compared to the same period ending a year ago. Salaries and employee benefits decreased $43,000. Amortization of mortgage servicing rights decreased $111,000 as a result of the slow down in residential mortgage refinancing activity mentioned previously. Other operating expenses decreased $24,000. Foreclosed property expense increased $174,000 due to increases in taxes, maintenance costs, and loan collection costs associated with the maintaining and disposition of other real estate. Professional services increased $21,000 primarily due to increases in legal fees associated with non-performing loans.
The Banks total cash and cash equivalents increased by $8.4 million during the three months ended March 31, 2010 compared to a $11.9 million increase for the same period in 2009. The primary sources of cash for the three months ended March 31, 2010 were$5.0 million increase in deposits, $6.4 million in proceeds from the sale of mortgage loans, $2.9 million in sales and maturities of available-for-sale investment securities and $2.3 of principal loan collections in excess of loan originations compared to $6.8 million increase in cash generated by the issuance of preferred stock, $9.1 million increase in deposits, $34.3 million in proceeds from the sale of mortgage loans, $2.6 million in maturities of available-for-sale investment securities. The primary uses of cash for the three months ended March 31, 2010 were $6.1 million of mortgage loans originated for sale and $3.7 million in purchases of available-for-sale investment securities compared to $35.0 million of mortgage loans originated for sale, $3.5 million in repayments of FHLB advances, $1.0 million in repayment of Fed funds purchased and $8.6 million in purchases of available-for-sale investment securities.
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