Newport Bancorp doubles 4Q profit

NEWPORT – Newport Bancorp Inc., the holding company for Newport Federal Savings Co., said last week that it nearly doubled its fourth-quarter profit, posting $787,000 in net income compared with $399,000 in the same period a year earlier.
Earnings were 24 cents per diluted share, which beat the 12 cent estimate by the one analyst who follows Newport Bancorp, Frank Schiraldi of Sandler O’Neill & Partners L.P., according to Yahoo!Finance.
Newport Bancorp finished the full year with $1.8 million of net income, more than doubling the $708,000 profit it posted in 2009.
During the final quarter of 2010, the company said its total revenue was $9.49 million, slightly more than the $9.33 million in the 2009 fourth quarter.
Several factors helped the company to a much bigger bottom line.
In a low-interest rate environment, Newport Bancorp was able to cut its interest expenses for deposits and long-term borrowings to $1.69 million, $416,000 less than expenses reported in the 2009 fourth quarter.
It also reduced its provision for income taxes to $293,000 in the fourth quarter from $612,000 in the same period a year earlier.
Nonperforming assets totaled $208,000 – or 0.05 percent of total assets – as of Dec. 31, compared with $860,000 – or 0.19 percent of total assets – a year ago. There were no nonperforming assets on the bank’s balance sheet of as March 31, 2009. Net charge-offs – loans the bank has deemed uncollectible – for all of 2010 totaled $751,000, compared with $50,000 for all of 2009, the company said.
Meanwhile, Newport Bancorp raised its loan-loss provision – money set aside in anticipation of loan defaults – for the fourth quarter to $175,000, up from $146,000 in the same period of 2009.
The increased provision was “due to charge-offs and recognition of a deteriorating economy,” Newport Bancorp said.
Deposits declined slightly in 2010 to $261.05 million as of Dec. 31, down from $261.95 million a year earlier. The company’s total assets also decreased in 2010 to $449.69 million from $458.88 million at the end of 2009.