ECBK 8-K
ECB Bancorp, Inc. /MD/ (ECBK)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company
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Item 2.02 Results of Operations and Financial Condition
On April 24, 2025, ECB Bancorp, Inc., the holding company for Everett Co-operative Bank, issued a press release announcing its financial results at and for the three months ended March 31, 2025.
A copy of the press release announcing the results is included as Exhibit 99.1 to this Current Report on Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
99.1 |
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104 |
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Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.
ECB BANCORP, INC.
Date: April 24, 2025 By: /s/Brandon N. Lavertu
Brandon N. Lavertu
Executive Vice President and Chief Financial Officer
Exhibit 99.1
For Immediate Release
Date: April 24, 2025
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Contact: |
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Richard J. O’Neil, Jr. |
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President and Chief Executive Officer |
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Phone: |
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617-387-1110 |
Email: |
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ECB Bancorp, Inc. Reports First Quarter Results
EVERETT, MA, April 24, 2025 - ECB Bancorp, Inc. (NASDAQ-ECBK) (the “Company”), the holding company for Everett Co-operative Bank (the “Bank”), a state-chartered co-operative bank headquartered in Everett, Massachusetts, today reported net income of $1.3 million, or $0.16 per diluted share for the quarter ended March 31, 2025 compared to $621,000, or $0.07 per diluted share, for the quarter ended March 31, 2024, an increase of $676,000, or 108.9% in net income.
Richard J. O’Neil, Jr., President and Chief Executive Officer, said, "We continue to maintain our focus on orderly and disciplined growth. The retail team has enhanced our existing relationships and attracted new customers with an expanded suite of cash management product offerings, deposit products and outstanding customer service. The efforts and success of our retail team, and the resultant deposit growth, have enabled our lending team to add quality loans supported by strong sponsors. We recently completed our initial stock repurchase program as part of our overall strategy to enhance shareholder value. Through these efforts and strong balance sheet management we have maintained our standing as a “well capitalized” institution as we execute our strategic plan."
NET INTEREST AND DIVIDEND INCOME
Net interest and dividend income before provision for credit losses was $6.6 million for the quarter ended March 31, 2025, compared to $5.9 million for the quarter ended March 31, 2024, representing an increase of $745,000, or 12.6%. This increase was primarily due to increases in the average balance and yields on interest-earning assets. The resulting net interest margin expanded by five basis points to 1.89% for the quarter ended March 31, 2025 as compared to 1.84% for the quarter ended March 31, 2024. The benefit for credit losses was $10,000 for the quarter ended March 31, 2025 compared to provision expense of $147,000 for the quarter ended March 31, 2024. The combination of these items resulted in net interest and dividend income after provision for credit losses of $6.7 million for the quarter ended March 31, 2025, as compared to $5.8 million for the quarter ended March 31, 2024, or an increase of $902,000, or 15.7%.
NONINTEREST INCOME
Noninterest income was $271,000 for the quarter ended March 31, 2025, as compared to $307,000 for the quarter ended March 31, 2024, or a decrease of $36,000, or 11.7%. The decrease was primarily due to decreases in net gains on sales of loans as we did not sell any loans during the quarter ended March 31, 2025.
NONINTEREST EXPENSE
Noninterest expense was $5.2 million for the quarter ended March 31, as compared to $5.2 million for the quarter ended March 31, 2024, or a decrease of $23,000, or 0.4%.
INCOME TAXES
We recorded a provision for income tax expense of $424,000 for the quarter ended March 31, 2025, compared to a provision for income tax expense of $211,000 for the quarter ended March 31, 2024, reflecting effective tax rates of 24.6% and 25.4%, respectively.
BALANCE SHEET
Total assets were $1.45 billion at March 31, 2025, as compared to $1.42 billion at December 31, 2024, or an increase of $34.0 million, or 2.4%.
Cash and cash equivalents decreased $9.5 million, or 6.0%, to $148.1 million at March 31, 2025 from $157.6 million at December 31, 2024. The decrease in cash and cash equivalents was driven by growth in both loans and investments that in aggregate, was greater than our growth in deposits.
Investments in securities available for sale were $14.0 million at March 31, 2025, as compared to $6.6 million at December 31, 2024, or an increase of $7.4 million, or 112.5%. This increase was due to purchases of new securities.
Investments in securities held to maturity were $68.1 million at March 31, 2025, as compared to $73.2 million at December 31, 2024, or a $5.1 million, or 7.0%, decrease. This decrease was due to maturities of securities.
Total gross loans were $1.19 billion at March 31, 2025, as compared to $1.15 billion at December 31, 2024, or an increase of $41.1 million, or 3.6%.
Total deposits were $1.04 billion at March 31, 2025, as compared to $998.5 million at December 31, 2024, or an increase of $38.1 million, or 3.8%.
Total shareholders' equity increased $310,000, or 0.2%, to $168.6 million as of March 31, 2025 from $168.3 million as of December 31, 2024. This increase is primarily the result of earnings of $1.3 million. Partially offsetting the increase from earnings were decreases in additional paid-in capital ("APIC") and accumulated other comprehensive income ("AOCI") of $310,000 and $767,000, respectively. The decrease in APIC was driven by $672,000 in shares repurchased under our share repurchase plan, partially offset by an increase in APIC of $362,000 related to stock-based compensation and ESOP shares committed to be released. The decrease in AOCI was driven by a decrease in the fair value of cash flow hedges. Our book value per share increased by $0.13 to $18.63 at March 31, 2025 from $18.50 at December 31, 2024.
ASSET QUALITY
Asset quality remains strong. The allowance for credit losses in total and as a percentage of total loans as of March 31, 2025 was $8.8 million and 0.74%, respectively, as compared to $8.9 million and 0.78%, respectively, as of December 31, 2024. For the quarter ended March 31, 2025, the Company recorded $82,000 in net charge offs. The Company did not record any net charge offs for the quarter ended March 31, 2024. Total non-performing assets were $1.3 million, or 0.09%, of total assets as of March 31, 2025 as compared to $2.0 million, or 0.14%, of total assets as of December 31, 2024.
Company Profile
ECB Bancorp, Inc. is headquartered in Everett, Massachusetts and is the holding company for Everett Co-operative Bank. The Bank provides financial services to individuals, families, municipalities and businesses through its three full-service branch offices located in Everett, Lynnfield, and Woburn, Massachusetts. The Company's common stock is traded on the NASDAQ Capital Market under the symbol "ECBK." For more information, visit the Company's website at www.everettbank.com.
Forward-looking statements
Certain statements herein constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on the beliefs and expectations of management, as well as the assumptions made using information currently available to management. Since these statements reflect the views of management concerning future events, these statements involve risks, uncertainties and assumptions. As a result, actual results may differ from those contemplated by these statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like "believe," "expect," "anticipate," "estimate," and "intend" or future or conditional verbs such as "will," "would," "should," "could" or "may." Certain factors that could cause actual results to differ materially from expected results include changes in the interest rate environment, changes in general economic conditions, the Company's ability to continue to increase loans and deposit growth, legislative and regulatory changes that adversely affect the businesses in which the Company is engaged and changes in the securities market. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The Company disclaims any intent or obligation to update any forward-looking statements, whether in response to new information, future events or otherwise, except as may be required by law.
ECB Bancorp, Inc. and Subsidiary
Consolidated Balance Sheets
(unaudited)
(in thousands except share data)
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March 31, 2025 |
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December 31, 2024 |
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ASSETS |
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Cash and due from banks |
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$ |
4,431 |
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$ |
5,828 |
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Short-term investments |
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143,677 |
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151,789 |
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Total cash and cash equivalents |
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148,108 |
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157,617 |
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Interest-bearing time deposits |
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100 |
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100 |
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Investments in available-for-sale securities (at fair value) |
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13,950 |
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6,564 |
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Investments in held-to-maturity securities, at amortized cost (fair values of $63,355 at |
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68,081 |
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73,215 |
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Loans held-for-sale |
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83 |
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— |
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Loans, net of allowance for credit losses of $8,808 at March 31, 2025 |
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1,177,543 |
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1,136,449 |
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Federal Home Loan Bank stock, at cost |
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10,000 |
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10,000 |
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Premises and equipment, net |
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3,455 |
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3,512 |
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Accrued interest receivable |
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4,343 |
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4,015 |
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Deferred tax asset, net |
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4,920 |
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4,914 |
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Bank-owned life insurance |
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15,061 |
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14,945 |
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Other assets |
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6,547 |
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6,822 |
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Total assets |
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$ |
1,452,191 |
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$ |
1,418,153 |
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LIABILITIES AND SHAREHOLDERS' EQUITY |
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Deposits: |
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Noninterest-bearing |
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$ |
79,853 |
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$ |
84,958 |
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Interest-bearing |
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956,767 |
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913,575 |
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Total deposits |
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1,036,620 |
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998,533 |
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Federal Home Loan Bank advances |
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234,000 |
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234,000 |
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Other liabilities |
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12,993 |
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17,352 |
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Total liabilities |
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1,283,613 |
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1,249,885 |
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Shareholders' Equity: |
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Preferred Stock, par value $0.01; Authorized: 1,000,000 shares; Issued and outstanding: 0 shares and 0 shares, respectively |
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— |
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— |
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Common Stock, par value $0.01; Authorized: 30,000,000 shares; Issued and outstanding: 9,049,790 shares and 9,095,833 shares, respectively |
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90 |
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91 |
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Additional paid-in capital |
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85,879 |
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86,189 |
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Retained earnings |
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89,142 |
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87,845 |
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Accumulated other comprehensive (loss) income |
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(385 |
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382 |
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Unearned compensation - ESOP |
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(6,148 |
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(6,239 |
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Total stockholders' equity |
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168,578 |
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168,268 |
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Total liabilities and stockholders' equity |
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$ |
1,452,191 |
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$ |
1,418,153 |
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Book value per common share |
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$ |
18.63 |
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$ |
18.50 |
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Regulatory Capital Ratios (Everett Co-operative Bank) |
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Total capital to risk weighted assets |
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16.23 |
% |
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16.58 |
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Tier 1 capital to risk weighted assets |
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15.25 |
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15.56 |
% |
Tier 1 capital to average assets |
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10.31 |
% |
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10.47 |
% |
ECB Bancorp, Inc. and Subsidiary
Consolidated Statements of Income
(unaudited)
(in thousands except share data)
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Three months ended |
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March 31, |
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2025 |
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2024 |
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Interest and dividend income: |
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Interest and fees on loans |
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$ |
15,142 |
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$ |
13,446 |
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Interest and dividends on securities |
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853 |
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764 |
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Interest on short term investments |
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1,625 |
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1,484 |
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Interest on interest-bearing time deposits |
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1 |
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— |
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Total interest and dividend income |
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17,621 |
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15,694 |
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Interest expense: |
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Interest on deposits |
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8,859 |
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7,524 |
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Interest on Federal Home Loan Bank advances |
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2,114 |
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2,267 |
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Total interest expense |
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10,973 |
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9,791 |
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Net interest and dividend income |
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6,648 |
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5,903 |
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(Benefit) provision for credit losses |
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(10 |
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147 |
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Net interest and dividend income after (benefit) provision for credit losses |
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6,658 |
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5,756 |
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Noninterest income: |
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Customer service fees |
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140 |
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137 |
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Income from bank-owned life insurance |
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116 |
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117 |
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Net gain on sales of loans |
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— |
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35 |
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Other income |
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15 |
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18 |
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Total noninterest income |
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271 |
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307 |
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Noninterest expense: |
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Salaries and employee benefits |
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3,260 |
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3,311 |
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Director compensation |
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216 |
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209 |
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Occupancy and equipment |
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281 |
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274 |
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Data processing |
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311 |
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311 |
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Computer software and licensing |
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109 |
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85 |
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Advertising and promotions |
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132 |
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131 |
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Professional fees |
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310 |
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360 |
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Federal Deposit Insurance Corporation deposit insurance |
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185 |
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179 |
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Other expense |
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404 |
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371 |
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Total noninterest expense |
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5,208 |
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5,231 |
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Income before income tax expense |
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1,721 |
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832 |
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Income tax expense |
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424 |
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211 |
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Net income |
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$ |
1,297 |
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$ |
621 |
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Share data: |
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Weighted average shares outstanding, basic |
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8,210,782 |
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8,299,775 |
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Weighted average shares outstanding, diluted |
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8,343,771 |
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8,375,335 |
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Basic earnings per share |
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$ |
0.16 |
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$ |
0.07 |
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Diluted earnings per share |
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$ |
0.16 |
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$ |
0.07 |
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