Oxford Bank Corporation, the holding company for Oxford Bank, last week announced 2006 earnings of $3,216,000 or $2.51 per share versus $4,420,000 or $3.45 per share reported twelve months earlier.
Net income for the fourth quarter ending December 31, 2006 was $375,000 ($0.29 per share) compared to $1,348,000 ($1.05 per share) in 2005.
Randall G. Fox, chairman of the Corporation and Oxford Bank, together with Corporate and Bank President and CEO Jeffrey M. Davidson, issued the report and commented, ‘As with most businesses whose primary dealings are tied to southeast Michigan, earnings at Oxford Bank were significantly impaired by the unique conditions of our local economy.
‘As we already know, no other state has recently faced the myriad of negative economic factors we have been burdened with. Declines in the state’s primary industry, the automobile sector, has resulted in high local unemployment and job losses, a stagnant housing market, declining commercial and residential real estate values, and high incidents of delinquent loans and home foreclosures.
‘For us, this has translated into lower collateral values, a higher contribution to the loan loss provision, and shrinking margins. Despite outstanding efforts by our management team and staff in managing credit quality in this environment, Oxford Bank was not immune.?
Fox went on to say, ‘Asset growth was further effected by, both, a strategic restructuring within our investment portfolio and a decision, in June, to discontinue our indirect vehicle lending program with local automobile, watercraft, and recreational vehicle dealers.
‘The latter move was a proactive measure made to inoculate Oxford Bank from the furthering instances of delinquent and impaired vehicle loans throughout southeast Michigan.
‘Each move has helped improve the quality of our earning assets and did allow us to generate income in an otherwise negative year.?
Mr. Davidson added, ‘As stated, 2006 was a challenging year; forcing us to decrease the size of the Bank. However, these measures will allow us to improve our overall asset quality and create a more efficient balance sheet.
‘Also, despite a decision to increase our loan loss reserve, our overall credit quality is sound and our rate of delinquent and impaired loans remains manageable. We will continue to be nimble and proactive in 2007, as the forecasts for the local Michigan economy remain unfriendly.?
The Corporation’s total assets at December 31, 2006 were $514,934,000, a decrease of 3.92 percent from one year earlier, whereas total deposits declined 1.69 percent to $460,151,000 over the same period.
In addition, net loans fell 2.18 percent to $378,267,000 during 2006, while shareholders? equity went up 4.90 percent to stand at $49,940,000 as the year ended, and book value per share increased $1.83 to end 2007 at $39.02 per share.
Finally, total cash dividends paid during the year increased by 1.79 percent over those paid in 2005.
Oxford Bank Corporation is a registered holding company.
Its subsidiary, Oxford Bank, is the oldest commercial bank in Oakland County and operates eight full-service offices in Clarkston, Davison, Dryden, Goodrich, Lake Orion, Oakland Township, Ortonville and Oxford.
It alsomanages a consumer lending center in Oxford and a commercial lending office in Lake Orion.
The Bank has operated continuously under local ownership and management since it first opened for business in 1884.