UNION, N.J., July 22, 2009 (GLOBE NEWSWIRE) -- Center Bancorp, Inc. (Nasdaq:CNBC), the parent company for Union Center National Bank ("UCNB"), today announced that it has negotiated a sale of its major other real estate owned ("OREO") property for $3.9 million dollars.
Anthony C. Weagley, President & Chief Executive Officer, added, "When we announce second quarter earnings later this month, we expect to report that at June 30, 2009, our non-performing assets amounted to $10.8 million, as compared with $9.1 million at March 31, 2009. The property we are selling represents nearly one third of our June 30, 2009 non-performing assets. Had this sale occurred on June 30, 2009, our non-performing assets would have reflected, a significant improvement over March 31, 2009. In addition, we expect to book a gain on the sale of the property in the approximate amount of $150,000. The sale is subject to a mortgage contingency, which was recently committed and accepted. The sale is also subject to normal performance requirements and standard contingencies. The sale is expected to close during the third quarter of 2009."
Asset Quality
Non-performing assets, which include loans past due 90 days or more and still accruing interest, trouble debt restructures, non-accrual loans and OREO, as a percentage of total assets, decreased to 0.80% as of June 30, 2009, from 0.81% at March 31, 2009 but was up from the 0.46% reported at year-end 2008. These June 30, 2009 figures include in OREO the property we have agreed to sell; at June 30, 2009, that property alone represented 0.26% of assets. Had the Corporation's pending OREO sale been consummated by June 30, 2009, non-performing assets would have been significantly reduced.
The Corporation has provided a loan loss provision of $156,000 for the second quarter of 2009, which will more than cover the $8,000 of net charges for the quarter.
At June 30, 2009, the total allowance for loan losses is expected to amount to $6.9 million, or 1.00% of total loans, as compared to $6.8 million or 1.00% of total loans at March 31, 2009. Management believes the allowance at June 30, 2009 is adequate to cover losses inherent in the loan portfolio.
Capital Adequacy
Center remained well capitalized with strong liquidity in the second quarter of 2009. Total stockholders' equity amounted to $89.5 million, or 6.67% of total assets, at June 30, 2009.
At June 30, 2009, the Corporation's Tier 1 Capital Leverage ratio was 7.52% and the Corporation's total Tier 1 Risk Based Capital ratio was 10.46%.
