Profile: Northeast Bancorp (NBN.OQ)
23 Sep 2016
Northeast Bancorp (Northeast), incorporated on March 20, 1987, is a bank holding company. The Company's primary subsidiary its banking subsidiary, Northeast Bank (the Bank or Northeast Bank), a Maine state-chartered bank. The Company provides a range of banking services to individual and corporate customers throughout south-central and western Maine and conducts loan purchasing and origination activities nationwide through its subsidiary.
The Company conducts its loan-related activities through three primary channels: the Community Banking Division, the Loan Acquisition and Servicing Group (LASG) and Small Business Administration National group (SBA National). The Community Banking Division originates loans directly to consumers and businesses located in its market area. The LASG purchases primarily performing commercial real estate loans, on a nationwide basis. The LASG also originates commercial real estate and commercial business loans on a nationwide basis. As of June 30, 2015, of its total loan portfolio of $612.1 million, $220.2 million was originated by the Community Banking Division, $380.9 million was purchased or originated by the LASG and $11.0 million was originated by SBA National.
The Company's Community Bank originated loan portfolio consists primarily of loans to consumers and businesses in the Community Banking Division's market area. It originates residential mortgage loans secured by one- to four-family properties throughout Maine, southern New Hampshire and Massachusetts. It also offers home equity loans and home equity lines of credit, which are secured by first or second mortgages on one- to four-family owner-occupied properties. As of June 30, 2015, portfolio residential loans totaled $130.5 million of total loans. Included in residential loans are home equity lines of credit and other second mortgage loans aggregating approximately $24.3 million.
The Company's originates multi-family and other commercial real estate loans secured by property located primarily in the Community Banking Division's market area. As of June 30, 2015, commercial real estate loans outstanding were $70.6 million of total loans. It originates commercial business loans, including term loans, lines of credit and equipment and receivables financing to businesses located primarily in the Community Banking Division's market area. As of June 30, 2015, commercial business loans outstanding were $11.9 million of total loans. It originates, on a direct basis, automobile, boat and recreational vehicle loans. As of June 30, 2015, consumer loans outstanding were $7.7 million of total loans. The Company's SBA loan portfolio includes owner and non-owner occupied loans.
The Company's available-for-sale securities portfolio totaled $101.9 million as of June 30, 2015. Mortgage-backed securities and the United States Government-sponsored enterprise bonds totaling $12.4 million were pledged for outstanding borrowings as of June 30, 2015. As of June 30, 2015, the Company's investment portfolio was comprised entirely of the United States Government-sponsored enterprise bonds and mortgage-backed securities guaranteed by government agencies.
Sources of Funds
The Bank's primary source for lending and other investment purposes are deposits. In addition to deposits, the Bank obtains funds from the amortization and prepayment of loans and mortgage-backed securities, the sale, call or maturity of investment securities, advances from the Federal Home Loan Bank of Boston (the FHLB), other term borrowings and cash flows generated by operations. It offers a line of deposit products to customers in western and south-central Maine through its ten-branch network. Its deposit products consist of demand deposit, Negotiable Order of Withdrawal (NOW), money market, savings and certificate of deposit accounts. Its customers access their funds through automated teller machines (ATMs), MasterCard Debit Cards, Automated Clearing House funds (electronic transfers) and checks. It also offers telephone banking, online banking and bill payment, mobile banking and remote deposit capture services. As of June 30, 2015, it had core deposits of $674.2 million.
Short-term borrowings, FHLB advances, Federal Reserve Discount Window Borrower-in-custody advances, wholesale repurchase agreements and junior subordinated debentures are the Company's sources of funding other than deposits. Its total borrowings were $13.2 million. Advances from the FHLB were $30.2 million as of June 30, 2015. Short-term borrowings, consisting of sweep accounts and repurchase agreements, were $2.3 million as of June 30, 2015.
The Bank's subsidiaries include Northeast Bank Insurance Group, Inc. (NBIG), 200 Elm Realty, LLC, 500 Pine Realty, LLC and 17 Dogwood Realty, LLC. NBIG holds the real estate formerly used in its insurance agency business. 200 Elm Realty, LLC holds commercial real estate acquired as a result of loan workouts. 500 Pine Realty, LLC holds residential real estate acquired as a result of loan workouts. 17 Dogwood Realty, LLC holds commercial real estate acquired as a result of loan workouts.
500 Canal St
LEWISTON ME 04240-6594