Freehold, NJ - (NewMediaWire) - March 04, 2016 - New Jersey Community Bank (OTCQB: NJCB) (the "Bank") reported a net loss of $2.2 million, or $(1.16) per common share for the three months ended December 31, 2015, compared to a net loss of $123 thousand, or $(0.06) per common share for the three months ended December 31, 2014. For the year 2015, the Bank reported a net loss of $2.8 million, or $(1.46) per common share compared with net loss of $68 thousand, or $(0.04) per common share for the year ended December 31, 2014.

The earnings for the year 2015 were negatively impacted by a valuation allowance recorded against the deferred tax assets. The earnings were further impacted by increases in professional fees as the Bank satisfies the requirements of the regulatory Consent Orders. The Provision for Loan Losses continues to burden the Bank's earnings as management attempts to address its asset quality and problem credits.

Annual Meeting Date

The Board of Directors voted that the Annual Meeting of Shareholders shall be held on April 21, 2016 at the American Hotel in Freehold, New Jersey at 9:30am. The record date of March 8, 2016 was established for the determination of the shareholders entitled to notice of, and to vote at, the annual meeting.

Balance Sheet Summary

At December 31, 2015, total assets were $111.1 million, a decrease of $10.9 million compared to year end 2014, primarily due to the decline in total loans. Total cash and cash equivalents were $11.4 million, an increase of $5.5 million from year end 2014. Total investment securities decreased $1.1 million to $15.6 million at December 31, 2015 compared with year end 2014.

Gross loans receivable decreased $13.4 million from December 31, 2014, primarily due to pay-offs of certain loans. The cash flow resulting from the decrease in total loans was largely used to fund the run-off of deposits and supported the increase in cash and cash equivalents.

Deposits totaled $98.8 million at December 31, 2015, a decrease of $8.3 million from year end 2014, primarily as a result of run-off of the core deposits and management's decision to utilize the excess liquidity to fund the matured time deposits. Of the total decrease, savings, NOW and money market deposits decreased $6.2 million and time deposits decreased $6.5 million, offset by an increase of $4.5 million in non-interest bearing demand deposits. Shareholders' equity totaled $11.8 million at December 31, 2015. The Bank's capital ratios continue to remain strong, with a tier 1 leverage ratio of 9.84%, a common equity tier 1 risk based capital ratio of 13.95% and a total risk based capital ratio of 15.21%. These ratios exceed those needed to be deemed a well-capitalized financial institution.

Results of Operations

Fourth Quarter 2015 For the quarter ended December 31, 2015, net interest income totaled $0.9 million, a decrease of $136 thousand over the same period in the prior year. Total interest income declined $158 thousand compared to the prior year fourth quarter largely due to a reduction in loan volume which impacted the decline in loan interest income. The reduction in interest expense on deposits was a result of a decrease in interest-bearing deposits.

The Bank did not record any provision for loan loss in the fourth quarter of 2015, compared with $263 thousand recorded in the same quarter a year-ago. The allowance for loan loss at period-end was $1.6 million, or 2.16% of gross loans compared with $1.6 million, or 1.83% of gross loans for the same period in the prior year. Management continually monitors the adequacy of the allowance for loan loss and considers the current level of the allowance for loan losses to be adequate.

Non-interest income increased moderately to $84 thousand for the quarter ended December 31, 2015 compared with $78 thousand for the same quarter in the prior year. The majority of the increase is directly related to a gain recorded on the sale of a bank owned automobile.

Non-interest expense totaled $1.3 million for the quarter ended December 31, 2015, an increase of $202 thousand from the year-ago quarter, primarily related to an increase in professional and other fees compared to the same quarter last year.

Income tax expense in the fourth quarter 2015 increased $2.0 million when compared to the same period in the prior year as a result of the valuation allowance recorded against the deferred tax assets ("DTA"). The DTA at year-end 2014 was $1.5 million. The pretax loss for the year 2015 created an additional $447 thousand in DTA as a result of the fact that net operating loss carrybacks claims have been exhausted. A full valuation allowance against the DTA was recorded resulting in an income tax expense of $1.9 million for the fourth quarter 2015.

US GAAP requires that all net deferred tax assets be evaluated on at least an annual basis to ensure that the asset is recorded at its net realizable value. If evidence exists which questions the realizability of this net deferred tax asset prior to its expiration, the Bank must record a valuation allowance.

Based on strong negative evidence that existed at year end December 31, 2015, management concluded that it needed to record a full valuation allowance against the Bank's deferred tax assets was necessary.

Full Year 2015 For the full year ended December 31, 2015, net interest income totaled $3.8 million, decreasing $558 thousand over the full prior year. The decrease in net interest income was primarily due to a decline in gross interest income resulting from a decrease in gross loans offset by a reduction in interest paid on deposits resulting primarily from declining balances in money market and time deposits. For the year, average interest earning assets and average interest bearing liabilities declined $8.3 million and $8.7 million, respectively, while the yield on interest earning assets and interest bearing deposits both declined 2 basis points. Net interest margin for the year declined 24 basis points to 3.25% over prior year.

The provision for loan losses was $710 thousand for the year, an increase of $82 thousand compared to prior year. The provision for loan loss continue to be impacted by classified loans during the year as management continues to resolve these problem credits.

Non-interest income totaled $339 thousand for the year 2015, reflecting a decrease of $82 thousand over the full year 2014, primarily resulting from decreases in fees on deposit accounts and loan fee income offset by gain on sale of fixed assets.

Non-interest expense totaled $4.7 million for the full year 2015, an increase of $415 thousand over prior full year, the majority of which was related to the litigation cost reversal recorded in the year 2014. Excluding the litigation cost reversal of $500 thousand, non-interest expense would have decreased $85 thousand year over year. Salaries and employee benefits, the largest component of non-interest expense, decreased $190 thousand as a result of reduction in staff. Professional fees increased $137 thousand primarily due to the consulting services utilized in connection with the compliance of the regulatory Consent Orders. Occupancy and equipment expense and data processing expenses decreased $36 thousand and $29 thousand, respectively, while other operating expenses increased $41 thousand.

Although the Bank reported a pretax loss for the year 2015, it had to record an income tax expense of $1.5 million for the year, primarily due to management's decision to provide for the valuation allowance against its deferred tax assets. Please refer to the discussion about the fourth quarter 2015 results for details on the valuation allowance.

About the Bank New Jersey Community Bank is a state-chartered commercial bank headquartered in Freehold, New Jersey. The Bank opened for business in July 2008 and operates three full-service banking offices in the central New Jersey counties of Monmouth and Middlesex. The Bank provides traditional commercial and retail banking services to small businesses and consumers. For additional information about New Jersey Community Bank, please visit www.njcbk.com or call 732-431-2265.

Forward-Looking Statements This release contains forward-looking statements relating to present or future trends or factors affecting the banking industry, and specifically the financial condition and results of operations, including without limitation, statements relating to the earnings outlook of the Bank, as well as its operations, markets and products. Actual results could differ materially from those indicated. Among the important factors that could cause results to differ materially are interest rate changes, change in economic climate, which could materially impact credit quality trends and the ability to generate loans, changes in the mix of the Bank's business, competitive pressures, changes in accounting, tax or regulatory practices or requirements, resolution of tax reviews, and those risk factors detailed in the Bank's periodic reports. The Bank undertakes no obligation to release revisions to these forward-looking statements or reflect events or circumstances after the date of this release.