Welcome!

News Feed Item

University Bancorp 2013 Profit $1,826,008, $0.391 per Share

ANN ARBOR, MI -- (Marketwired) -- 04/04/14 -- University Bancorp, Inc. (OTCQB: UNIB) announced that it had audited net income attributable to University Bancorp, Inc. common stock shareholders in 2013 of $1,826,008, $0.391 per share on average shares outstanding of 4,673,980 for the year. For 2013, University Bancorp had pre-tax income of $3,678,893. For 2013, income allocated to non-controlling interests of $1,053,940, preferred stock dividends of $93,085 and income tax of $1,246,330 were incurred.

For 2013, the Company's return on equity attributable to common stock shareholders was 24.6% on initial equity of $7,436,190.

Net income (loss) attributable to University Bancorp, Inc. common stock shareholders in the fourth quarter of 2013 was ($177,287), or ($0.038) per share on average shares outstanding of 4,692,828. The final quarter of 2013 was negatively impacted by employee profit sharing in December 2013 of $400,000 with respect to the 2013 year. Profit sharing with respect to the 2012 year was accrued in March 2013 in the amount of $587,000 and the December 2013 charge represents a change in timing to recognize the employee profit sharing payments earlier based on estimates and at the time when actually approved by the board of directors. Also of note, we began amortizing the customer list related to our acquisition of the Ann Arbor Insurance Centre (AAIC) subsidiary, which resulted in a $71,143 expense in 4Q2013 and we will incur a similar charge at the rate of $17,786 per quarter for 2014 and each year until the end of 2019, when this acquisition cost will be fully amortized.

In addition to the extra $587,000 of profit sharing and new $71,143 insurance agency acquisition related amortization expense, unusual expenses in 2013 also included $80,000 expense related to the sale of $437,000 in substandard loans through DebtX, and the final payment of $447,385 under the tax sharing agreement with the minority investors in our University Islamic Financial subsidiary, fully completing these contractual payments. These were offset by MSR valuation gains of $1,151,405. Also of note, income from the fair value of hedged and rate locked loans held for sale dropped year over year by $1,228,212 as the mortgage origination pipeline ended 2013 at $17.7 million, significantly lower than the level at the end of 2012, which was $43.0 million.

Audited net income attributable to University Bancorp, Inc. common stock shareholders in 2012 was $1,915,859, $0.411 per share on average shares outstanding of 4,661,348 for the year. For 2012, University Bancorp had pre-tax income of $4,678,663. For 2012, income allocated to non-controlling interests was $859,534, preferred stock dividends were $93,938 and income tax of $1,955,885 was incurred. The effective tax rate differed from the statutory federal income tax rate as a result of permanent tax differences and changes in tax estimates as a result of two acquisitions. For 2012, the Company's return on equity attributable to common stock shareholders was 32.5% on initial equity of $5,887,158.

Unusual expenses in 2012 included $3.46 million in reserves and write-offs related to ORE sales, Allowance for Loan Losses (ALLL) reserves and other reserves only partially offset by $414,000 in unusual gains related to MSR valuation gains and hedged pipeline gains. We moved aggressively in 2012 to write-down, discount and sell substandard assets and add to our ALLL.

The ALLL had a balance of $968,244 at 12/31/2013 versus portfolio loans of $49,464,710, or 1.96%. Substandard assets dropped 30% during 2013 to $1,892,138, 14.67% of Tier 1 Capital at 12/31/2013, including other real estate owned of $431,553.

Tier 1 Capital rose to 12.75% at 12/31/2013 on average assets of $101.1 million, was 12.69% at 9/30/2013 on average assets of $108.1 million, and is projected to be 13.79% at 12/31/2014, if we achieve our 2014 budget goal unless we opt to pay dividends or conduct a stock buyback during 2014, which is a possibility.

President Stephen Lange Ranzini noted, "The budget for 2014 calls for the company to have net income attributable to University Bancorp, Inc. common stock shareholders of $2.68 million after-tax, $0.57 per share, and the bank to earn $5.17 million pre-tax and $3.4 million after-tax before minority interest."

Shareholders' equity attributable to University Bancorp, Inc. common stock shareholders rose to $9,439,485 or $2.011 per share, based on shares outstanding at December 31, 2013 of 4,692,828. Excluding goodwill & other intangibles related to the acquisition of Midwest Loan Services and AAIC, net tangible shareholders' equity attributable to University Bancorp, Inc. common stock shareholders rose to $8,656,318 or $1.845 per share at 12/31/2013. (Please note that we provide this statistic only because we are asked for it and do not see it as particularly useful or meaningful.)

Michigan and the Ann Arbor MSA continue to see increased employment and increased home prices and as a result, the performance of our portfolio loans and our overall asset quality continues to be superior with low loan delinquencies. As of 12/31/2013 in our loan portfolio held for investment we had no consumer or commercial loans delinquent over 30 days, and we had just two residential mortgage loans delinquent 30 days and one residential mortgage loan for $56,133 delinquent over 90 days.

In 2013, we originated $565.1 million in residential mortgage loans for our own account, versus $588.7 million in 2012. Of the 2013 retail originations, 80.2% of University Lending Group's and 66.8% of University Islamic Financial's residential mortgage originations financed purchase transactions. In addition we originated $89.8 million in portfolio residential mortgage loans for our credit union customers in 2013.

In 1Q2014 we completed the migration of all our credit union's retail originations to the unified back office platform across which our other residential originations flow. This is expected to enable an increase in the origination business won from our current 340 credit union and 7 community bank subservicing customers, since our unified origination platform is significantly more competitive than the platform it is replacing.

Liquidity remains excellent. We manage $70 million of deposits in an off-balance sheet sweep arrangement through a series of deposit accounts at the Federal Home Loan Bank of Indianapolis (FHLBI), which are available to us to meet any withdraws in just a few minutes, and on which we earn interest at Fed Funds rate.

President Stephen Lange Ranzini noted, "Although we didn't meet the 2013 budget due to an unbudgeted drop in mortgage originations in the fourth quarter, 2013 continued the long track record of success for the Company. Based on the rankings from our FDIC Call Report data, IDC Financial Publishing, Inc. (IDC) has rated University Bank with a perfect 300 out of 300 rating for three quarters in a row, and we are one of only two banks headquartered in Michigan the past two quarters with a perfect IDC rating. IDC is generally considered to be the best and most prestigious organization that rates the financial quality and strength of banks in the U.S."

The Company will host a conference call at Noon at Thursday April 10, 2014 to discuss the 2013 results with its shareholders. Please contact Stephen Lange Ranzini via
email at [email protected] to receive the call-in information for this call.

Other key statistics:

  • 5-year annual average revenue growth*, 37.7%
  • 1-year annual revenue growth*, -2.8%
  • Debt to equity ratio+, 11.1%
  • Current Ratio,# 38.3x
  • Trailing 12 Months P-E Ratiox, 19.2x

*2013, 2012 and 2008 sales were $38,856,573, $39,991,125 and $13,449,856, respectively.
+Outstanding Preferred Stock (including dividends payable) was $1,171,332 and total Company equity capital (common stock plus preferred stock) was $10,614,778.
#Parent company only current assets were $723,796 divided by 12 month proj. cash expenses.
xBased on last sale price of $7.50 per share.

Highlights for the year include:

  • Mortgages subserviced by Midwest Loan Services grew 12.5% to 92,763 from 82,456, the total of mortgages subserviced grew to $14.3 billion and revenue at Midwest Loan Services fell 5.0% to $12,808,888 from $13,478,140 due to a drop in mortgage origination from credit unions;
  • Deposit mortgage escrow deposits at University Bank including sweep accounts at the FHLBI grew 39.6% to $201,267,000 from $144,264,091;
  • Our Islamic division booked its third annual operating profit, pre-tax profit of $2,952,535 up 85.4% from $1,592,400 in 2012, Islamic assets under management rose to $377.5 million and revenues grew 33.1% to $8,050,093 from $6,047,000;
  • University Bank and its subsidiaries continue to actively lend in our local communities with $565,088,069 in residential mortgage originations in 2013 down 4.0% from $588,680,377 in 2012.

Key metrics for the year ended December 31, 2013 were:

  • Total Revenue decreased to $38.9 million from $40.0 million, down 2.8%;
  • Total Assets decreased to $111.2 million from $132.2 million, down 15.9%;
  • Net Interest and financing income decreased to $4.24 million, down 2.8%;
  • Loans and financings held for portfolio decreased 9.8% to $48.5 million;
  • Islamic residential originations fell 7.4% to $132,212,140 from $142,747,243;
  • Islamic residential real estate financings originated since inception of our Islamic business unit hit $500,179,343 at 12/31/2013;
  • University Lending Group (ULG) residential real estate financings originated since inception hit $2,005,140,075 at 12/31/2013;
  • ULG revenue fell 8.6% to $16,517,253 from $18,069,467 despite a 32% rise in residential purchase transactions financed;
  • Total FTE employees rose 0.6% to 311 from 309;
  • Tier 1 Capital rose to 12.75% from 9.69%;
  • Return on common stockholders' equity was 24.6%.

Shareholders and investors are encouraged to refer to the financial information including the audited financial statements, strategic plan and prior press releases, available on our investor relations web page at: http://www.university-bank.com/bancorp/.

Ann Arbor-based University Bancorp owns 100% of University Bank which, together with its Michigan-based subsidiaries, holds and manages a total of over $14.7 billion in loans and assets and our 331 employees make us the 9th largest bank based in Michigan. University Bank is an FDIC-insured, locally owned and managed community bank, and meets the financial needs of its community through its creative and innovative services. Founded in 1890, University Bank® is proud to have been selected as the "Community Bankers of the Year" by American Banker magazine and as the recipient of the American Bankers Association's Community Bank Award. University Bank is a Member FDIC. The operating subsidiaries of University Bank which are members of our corporate family, ranked by their size of revenues are:

  • University Lending Group, a retail residential mortgage originator based in Clinton Township;
  • Midwest Loan Services, a residential mortgage subservicer based in Houghton;
  • University Islamic Financial, an Islamic banking firm based in Farmington Hills;
  • Community Banking, based in Ann Arbor, which provides traditional community banking services in the Ann Arbor area;
  • Ann Arbor Insurance Centre, an independent insurance agency based in Ann Arbor.

CAUTIONARY STATEMENT: This press release contains certain forward-looking statements that involve risks and uncertainties. Forward-looking statements include, but are not limited to, statements concerning future growth in assets, pre-tax income and net income, budgeted income levels, the sustainability of past results, and other expectations and/or goals. Such statements are subject to certain risks and uncertainties which could cause actual results to differ materially from those expressed or implied by such forward-looking statements, including, but not limited to, economic, competitive, governmental and technological factors affecting our operations, markets, products, services, interest rates and fees for services. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release.

Contact:
Stephen Lange Ranzini
President and CEO
Phone: 734-741-5858, Ext. 9226
Email: Email Contact

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
The Internet giants are fully embracing AI. All the services they offer to their customers are aimed at drawing a map of the world with the data they get. The AIs from these companies are used to build disruptive approaches that cannot be used by established enterprises, which are threatened by these disruptions. However, most leaders underestimate the effect this will have on their businesses. In his session at 21st Cloud Expo, Rene Buest, Director Market Research & Technology Evangelism at Ara...
WebRTC is great technology to build your own communication tools. It will be even more exciting experience it with advanced devices, such as a 360 Camera, 360 microphone, and a depth sensor camera. In his session at @ThingsExpo, Masashi Ganeko, a manager at INFOCOM Corporation, will introduce two experimental projects from his team and what they learned from them. "Shotoku Tamago" uses the robot audition software HARK to track speakers in 360 video of a remote party. "Virtual Teleport" uses a mu...
Trying to improve density, lower costs and run applications faster than before? Today, enterprises looking for a secure cloud strategy are increasingly turning to container-based Platform as a Service solutions for on-premises hosted DevOps. In her session at 21st Cloud Expo, Alise Cashman Spence, Offering Manager, Power Systems Cloud Solutions at IBM, will discuss the driving factors behind these cloud trends and how IBM customers are realizing exceptional performance, security and control for ...
Internet of @ThingsExpo, taking place October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 21st Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The Internet of Things (IoT) is the most profound change in personal and enterprise IT since the creation of the Worldwide Web more than 20 years ago. All major researchers estimate there will be tens of billions devic...
Mobile device usage has increased exponentially during the past several years, as consumers rely on handhelds for everything from news and weather to banking and purchases. What can we expect in the next few years? The way in which we interact with our devices will fundamentally change, as businesses leverage Artificial Intelligence. We already see this taking shape as businesses leverage AI for cost savings and customer responsiveness. This trend will continue, as AI is used for more sophistica...
"When we talk about cloud without compromise what we're talking about is that when people think about 'I need the flexibility of the cloud' - it's the ability to create applications and run them in a cloud environment that's far more flexible,” explained Matthew Finnie, CTO of Interoute, in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
SYS-CON Events announced today that SourceForge has been named “Media Sponsor” of SYS-CON's 21st International Cloud Expo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. SourceForge is the largest, most trusted destination for Open Source Software development, collaboration, discovery and download on the web serving over 32 million viewers, 150 million downloads and over 460,000 active development projects each and every month.
"NetApp's vision is how we help organizations manage data - delivering the right data in the right place, in the right time, to the people who need it, and doing it agnostic to what the platform is," explained Josh Atwell, Developer Advocate for NetApp, in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
What You Need to Know You know you need the cloud, but you’re hesitant to simply dump everything at Amazon since you know that not all workloads are suitable for cloud. You know that you want the kind of ease of use and scalability that you get with public cloud, but your applications are architected in a way that makes the public cloud a non-starter. You’re looking at private cloud solutions based on hyperconverged infrastructure, but you’re concerned with the limits inherent in those technolog...
SYS-CON Events announced today that DXWorldExpo has been named “Global Sponsor” of SYS-CON's 21st International Cloud Expo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Digital Transformation is the key issue driving the global enterprise IT business. Digital Transformation is most prominent among Global 2000 enterprises and government institutions.
One of the biggest challenges with adopting a DevOps mentality is: new applications are easily adapted to cloud-native, microservice-based, or containerized architectures - they can be built for them - but old applications need complex refactoring. On the other hand, these new technologies can require relearning or adapting new, oftentimes more complex, methodologies and tools to be ready for production. In his general session at @DevOpsSummit at 20th Cloud Expo, Chris Brown, Solutions Marketi...
SYS-CON Events announced today that Nihon Micron will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Nihon Micron Co., Ltd. strives for technological innovation to establish high-density, high-precision processing technology for providing printed circuit board and metal mount RFID tags used for communication devices. For more inf...
SYS-CON Events announced today that Ryobi Systems will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Ryobi Systems Co., Ltd., as an information service company, specialized in business support for local governments and medical industry. We are challenging to achive the precision farming with AI. For more information, visit http:...
SYS-CON Events announced today that mruby Forum will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. mruby is the lightweight implementation of the Ruby language. We introduce mruby and the mruby IoT framework that enhances development productivity. For more information, visit http://forum.mruby.org/.
SYS-CON Events announced today that Mobile Create USA will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Mobile Create USA Inc. is an MVNO-based business model that uses portable communication devices and cellular-based infrastructure in the development, sales, operation and mobile communications systems incorporating GPS capabi...