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| ECBE > SEC Filings for ECBE > Form 10-Q on 11-May-2009 | All Recent SEC Filings |
11-May-2009
Quarterly Report
Forward-Looking Statements
Statements in this Report and exhibits relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments, expectations or beliefs about future events or results, and other statements that are not descriptions of historical facts, may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties,
and actual results could differ materially from those currently anticipated due
to a number of factors, which include, but are not limited to, risk factors
discussed in Item 1A under the heading "Rick Factors" in the Company's Annual
Report on Form 10-K and in other documents filed by the Company with the
Securities and Exchange Commission from time to time. Forward-looking statements
may be identified by terms such as "may", "will", "should", "could", "expects",
"plans", "intends", "anticipates", "believes", "estimates", "predicts",
"forecasts", "potential" or "continue," or similar terms or the negative of
these terms, or other statements concerning opinions or judgments of the
Company's management about future events. Factors that could influence the
accuracy of such forward-looking statements include, but are not limited to:
(a) pressures on the earnings, capital and liquidity of financial institutions
resulting from current and future adverse conditions in the credit and equity
markets and the banking industry in general, (b) the financial success or
changing strategies of the Company's customers, (c) actions of government
regulators, (d) the level of market interest rates, (e) weather and similar
conditions, particularly the effect of hurricanes on the Company's banking and
operations facilities and on the Company's customers and the communities in
which it does business, (f) changes in general economic conditions and the real
estate values in our banking market (particularly changes that affect our loan
portfolio, the abilities of our borrowers to repay their loans, and the values
of loan collateral), (g) changes in competitive pressures among depository and
other financial institutions or in our ability to compete effectively against
larger financial institutions in our banking market. Although the Company
believes that the expectations reflected in the forward-looking statements are
reasonable, it cannot guarantee future results, levels of activity, performance
or achievements. All forward-looking statements attributable to the Company are
expressly qualified in their entirety by the cautionary statements in this
paragraph. The Company has no obligations, and does not intend to update these
forward-looking statements.
Executive Summary
ECB Bancorp, Inc. is a bank holding company headquartered in Engelhard, North Carolina. Our wholly owned subsidiary, The East Carolina Bank (the "Bank") is a state-chartered community bank that was founded in 1919. For the purpose of this discussion, "we," "us" and "our" refers to the Bank and the bank holding company as a single, consolidated entity unless the context otherwise indicates.
As of March 31, 2009, we had consolidated assets of approximately $865.4 million, total loans of approximately $550.6 million, total deposits of approximately $688.1 million and shareholders' equity of approximately $86.9 million. For the three months ended March 31, 2009, we had income available to common shareholders of $1.0 million or $0.37 basic and diluted earnings per share, compared to income available to common shareholders of $1.0 million, or $0.36 basic and diluted earnings per share for the three months ended March 31, 2008.
Critical Accounting Policies
The Company's significant accounting policies are set forth in Note 1 to the Consolidated Financial Statements contained in the Form 10-K Annual Report for the fiscal year ended December 31, 2008. Of these significant accounting policies, the Company considers its policy regarding the allowance for loan losses to be its most critical accounting policy, because it requires management's most subjective and complex judgments. In addition, changes in economic conditions can have a significant impact on the allowance for loan losses and therefore the provision for loan losses and results of operations. The Company has developed appropriate policies and procedures for assessing the adequacy of the allowance for loan losses, recognizing that this process requires a number of assumptions and estimates with respect to its loan portfolio. The Company's assessments may be impacted in future periods by changes in economic conditions, the results of regulatory examinations, and the discovery of information with respect to borrowers that is not known to management at the time of the issuance of
the consolidated financial statements. For additional discussion concerning the Company's allowance for loan losses and related matters, see "Asset Quality".
We also consider our determination of retirement plans and other postretirement benefit cost to be a critical accounting estimate as it requires the use of estimates and judgments related to the amount and timing of expected future cash out-flows for benefit payments and cash in-flows for maturities and return on plan assets. Our retirement plans and other post-retirement benefit costs are actuarially determined based on assumptions on the discount rate, estimated future return on plan assets and the health care cost trend rate. Changes in estimates and assumptions related to mortality rates and future health care costs could have a material impact to our financial condition or results of operations. The discount rate is used to determine the present value of future benefit obligations and the net periodic benefit cost. The discount rate used to value the future benefit obligation as of each year-end is the rate used to determine the periodic benefit cost in the following year. For additional discussion concerning our retirement plans and other postretirement benefits refer to Note 8 to the Consolidated Financial Statements contained in our Form 10-K Annual Report for the fiscal year ended December 31, 2008.
Comparison of the Results of Operations for the Three Month Periods Ended March 31, 2009 and 2008
Results of Operations
The following table summarizes components of income and expense and the changes in those components for the three-month period ended March 31, 2009 as compared to the same period in 2008.
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