Profile: Northeast Community Bancorp Inc (NECB.OQ)
7 Mar 2014
Northeast Community Bancorp, Inc. (Northeast Community Bancorp) is a holding company for Northeast Community Bank (the Bank). The Company’s primary activity is the ownership and operation of the Bank. The Bank is principally engaged in the business of attracting deposits and investing those funds into mortgage and commercial loans. As of December 31, 2011, the Bank conducted banking operations from its headquarters in White Plains, New York, its four full service branches in New York City, New York, its two full service branches in Danvers and Plymouth, Massachusetts and its loan production office in Danvers, Massachusetts, gathering deposits and lending from Pittsburgh, Pennsylvania to southern New Hampshire. The Bank also offers investment advisory and financial planning services under the name, Hayden Wealth Management Group, a division of the Bank. The Bank conducts lending activities throughout the Northeastern United States, including New York, Massachusetts, New Jersey, Connecticut and Pennsylvania.
The Bank originates loans primarily for investment purposes. The Bank originates multi-family residential real estate loans, mixed-use real estate loans and non-residential real estate loans and commercial loans. The Bank also makes consumer loans and purchases participation interests in construction loans. The Bank offers adjustable rate mortgage loans secured by multi-family and mixed-use real estate. These loans are comprised primarily of loans on low to moderate income apartment buildings located in its lending territory and include, loans on cooperative apartment buildings (in the New York area), and loans for Section 8 multi-family housing. On December 31, 2011, the largest outstanding multi-family real estate loan had a balance of $8.6 million.
The Bank originates a range of adjustable-rate and balloon multi-family and mixed-use real estate loans. The adjustable-rate loans have fixed rates for a period of up to five years and then adjust every one, two, three or five years thereafter, based on the terms of the loan. Maturities on these loans can be up to 15 years, and they amortize over a 20 to 30-year period. The Bank’s non-residential real estate loans are generally secured by office buildings, medical facilities and retail shopping centers that are primarily located within its lending territory. At December 31, 2011, the Bank had $83.6 million in non-residential real estate loans outstanding, or 23.4% of total loans.
The Bank offers equity lines of credit on multi-family, mixed-use and non-residential real estate properties, on which it holds the first mortgage. For existing borrowers only, the Bank offers an equity line of credit program secured by a second mortgage on the borrower’s multi-family, mixed-use or non-residential property. The Bank’s equity lines of credit are typically interest only for the first five years and then the remaining term of the line of credit is tied to the remaining term on the first mortgage on the multi-family, mixed-use property. The Bank’s . construction loans are typically for 12-24 month terms and pay interest only during that period. The outstanding balance of construction loan participation interests purchased totaled $9.1 million at December 31, 2011.
The Bank offers loans secured by savings accounts or certificates of deposit (share loans) and overdraft protection for checking accounts, which is linked to statement savings accounts and has the ability to transfer funds from the statement savings account to the checking account when needed to cover overdrafts. At December 31, 2011, our portfolio of consumer loans was $68,000, or 0.02% of total loans.
As of December 31, 2011, the Bank’s interest-bearing deposits, securities, and short-term investments totaled $100.6 million and consisted primarily of $80.1 million in interest earning deposits with the Federal Home Loan Bank of New York, $12.6 million in mortgage-backed securities issued primarily by Fannie Mae, Freddie Mac and Ginnie Mae, $3.7 million in collateralized mortgage obligations issued primarily by Federal National Mortgage Association (Fannie Mae), Federal Home Loan Mortgage Corporation (Freddie Mac) and Government National Mortgage Association (Ginnie Mae), $2.6 million in short-term certificates of deposits at other financial institutions, and $1.6 million in Federal Home Loan Bank of New York common stock. At December 31, 2011, it had no investments in callable securities.
Sources of Funds
Deposits, borrowings and loan repayments are principal sources of the Bank’s funds for lending and other investment purposes. The Bank offers a range of deposit accounts with a range of interest rates and terms. Its deposits principally consist of interest-bearing demand accounts (such as negotiable order of withdrawal (NOW) and money market accounts), regular savings accounts, noninterest-bearing demand accounts (such as checking accounts) and certificates of deposit. At December 31, 2011, the Bank did not utilize brokered deposits. The Bank may utilize advances from the Federal Home Loan Bank of New York to supplement its supply of investable funds.
Northeast Community Bancorp Inc
325 Hamilton Avenue
WHITE PLAINS NY 10601