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
SYS-CON Events announced today that MangoApps will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. MangoApps provides modern company intranets and team collaboration software, allowing workers to stay connected and productive from anywhere in the world and from any device. For more information, please visit https://www.mangoapps.com/.
The cloud market growth today is largely in public clouds. While there is a lot of spend in IT departments in virtualization, these aren’t yet translating into a true “cloud” experience within the enterprise. What is stopping the growth of the “private cloud” market? In his general session at 18th Cloud Expo, Nara Rajagopalan, CEO of Accelerite, will explore the challenges in deploying, managing, and getting adoption for a private cloud within an enterprise. What are the key differences betwee...
WebRTC is bringing significant change to the communications landscape that will bridge the worlds of web and telephony, making the Internet the new standard for communications. Cloud9 took the road less traveled and used WebRTC to create a downloadable enterprise-grade communications platform that is changing the communication dynamic in the financial sector. In his session at @ThingsExpo, Leo Papadopoulos, CTO of Cloud9, will discuss the importance of WebRTC and how it enables companies to fo...
As machines are increasingly connected to the internet, it’s becoming easier to discover the numerous ways Industrial IoT (IIoT) is helping to shape the business world. This is exactly why we have decided to take a closer look at this pervasive movement and to examine the desire to connect more things! Now if you need a refresher on IIoT and how it is changing the world, take a moment and listen to Greg Gorbach with ARC Advisory Group. Gorbach believes, "IIoT will significantly change the worl...
The IoT is changing the way enterprises conduct business. In his session at @ThingsExpo, Eric Hoffman, Vice President at EastBanc Technologies, discuss how businesses can gain an edge over competitors by empowering consumers to take control through IoT. We'll cite examples such as a Washington, D.C.-based sports club that leveraged IoT and the cloud to develop a comprehensive booking system. He'll also highlight how IoT can revitalize and restore outdated business models, making them profitable...
In his session at 18th Cloud Expo, Bruce Swann, Senior Product Marketing Manager at Adobe, will discuss how the Adobe Marketing Cloud can help marketers embrace opportunities for personalized, relevant and real-time customer engagement across offline (direct mail, point of sale, call center) and digital (email, website, SMS, mobile apps, social networks, connected objects). Bruce Swann has more than 15 years of experience working with digital marketing disciplines like web analytics, social med...
SYS-CON Events announced today that Super Micro Computer, Inc., a global leader in Embedded and IoT solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Supermicro (NASDAQ: SMCI), the leading innovator in high-performance, high-efficiency server technology, is a premier provider of advanced server Building Block Solutions® for Data Center, Cloud Computing, Enterprise IT, Hadoop/Big Data, HPC and ...
IoT generates lots of temporal data. But how do you unlock its value? How do you coordinate the diverse moving parts that must come together when developing your IoT product? What are the key challenges addressed by Data as a Service? How does cloud computing underlie and connect the notions of Digital and DevOps What is the impact of the API economy? What is the business imperative for Cognitive Computing? Get all these questions and hundreds more like them answered at the 18th Cloud Expo...
SYS-CON Events announced today the Docker Meets Kubernetes – Intro into the Kubernetes World, being held June 9, 2016, in conjunction with 18th Cloud Expo | @ThingsExpo, at the Javits Center in New York, NY. Register for 'Docker Meets Kubernetes Workshop' Here! This workshop led by Sebastian Scheele, co-founder of Loodse, introduces participants to Kubernetes (container orchestration). Through a combination of instructor-led presentations, demonstrations, and hands-on labs, participants learn ...
How will your company move to the cloud while ensuring a solid security posture? Organizations from small to large are increasingly adopting cloud solutions to deliver essential business services at a much lower cost. According to cyber security experts, the frequency and severity of cyber-attacks are on the rise, causing alarm to businesses and customers across a variety of industries. To defend against exploits like these, a company must adopt a comprehensive security defense strategy that is ...
SYS-CON Events announced today that ContentMX, the marketing technology and services company with a singular mission to increase engagement and drive more conversations for enterprise, channel and SMB technology marketers, has been named “Sponsor & Exhibitor Lounge Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York City, New York. “CloudExpo is a great opportunity to start a conversation with new prospects, but what happens after the...
In his session at 18th Cloud Expo, Andrew Cole, Director of Solutions Engineering at Peak 10, will discuss how the newest technology advances are reducing the cost and complexity of traditional business continuity and disaster recovery solutions. Attendees will: Learn why having a full disaster recovery strategy is more important now than ever before Explore the key drivers of a successful disaster recovery solution Achieve measurable operational and business value from a disaster recovery ...
SYS-CON Events announced today the How to Create Angular 2 Clients for the Cloud Workshop, being held June 7, 2016, in conjunction with 18th Cloud Expo | @ThingsExpo, at the Javits Center in New York, NY. Angular 2 is a complete re-write of the popular framework AngularJS. Programming in Angular 2 is greatly simplified. Now it’s a component-based well-performing framework. The immersive one-day workshop led by Yakov Fain, a Java Champion and a co-founder of the IT consultancy Farata Systems and...
Customer experience has become a competitive differentiator for companies, and it’s imperative that brands seamlessly connect the customer journey across all platforms. With the continued explosion of IoT, join us for a look at how to build a winning digital foundation in the connected era – today and in the future. In his session at @ThingsExpo, Chris Nguyen, Group Product Marketing Manager at Adobe, will discuss how to successfully leverage mobile, rapidly deploy content, capture real-time d...
SYS-CON Events announced today that Hanu Software will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Leveraging best-in-class people, processes, and technologies, Hanu provides high-quality, high-value software development and business process outsourcing services to independent software vendors (ISVs) and enterprises.