##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, DC 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended June 30, 2009
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number: 001-34089
 BANCORP OF NEW JERSEY, INC.
  New Jersey
    
    20-8444387(State or other jurisdiction of
    
    (I.R.S. Employer Identification No.)incorporation or organization)1365 Palisade Ave, Fort Lee, New Jersey
    
    07024(Address of principal executive offices)
    
    (Zip Code)
 (201) 944-8600  (Registrants
telephone number, including area code)
 þ o
 Yes o No o
 Rule 12b-2
 Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ
 o þ




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##### 



INDEX
 PAGEPart I Financial InformationItem 1. Financial Statements:Unaudited Consolidated Statements of Financial Condition
 June 30, 2009 and December 31, 2008
    
    
    3Unaudited Consolidated Statements of Operations  Three Months
Ended June 30, 2009 and 2008
    
    
    4Unaudited Consolidated Statements of Operations  Six
Months Ended June 30, 2009 and 2008
    
    
    5Unaudited Consolidated Statements of Cash Flows  Six
Months Ended June 30, 2009 and 2008
    
    
    6Notes to Unaudited Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis of Financial
Condition and Results of Operations
    
    
    24Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    32Item 4. Controls and Procedures
    
    
    32Part II Other InformationItem 1. Legal Proceedings
    
    
    33Item 1A. Risk Factors
    
    
    33Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    33Item 3. Defaults Upon Senior Securities
    
    
    33Item 4. Submission of Matters to a Vote of Securities Holders
    
    
    33Item 5. Other Information
    
    
    33Item 6. Exhibits
    
    
    33Signatures
    
    
    34Exhibit 31.1Exhibit 31.2Exhibit 32
   2




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BANCORP OF NEW JERSEY, INC.
 
   June 30, 2009
    
    
    December 31,     2008ASSETSCash and due from banks
    
    $
    7,191
    
    
    $
    304Interest bearing deposits
    
    
    60
    
    
    
    40,107Federal funds sold
    
    
    5,190
    
    
    
    69Total cash and cash equivalents
    
    
    12,441
    
    
    
    40,480Restricted investment in bank stock, at cost
    
    
    419
    
    
    
    346Securities available for sale, at fair value
(amortized cost of $24,250 and $17,641,
respectively)
    
    
    24,052
    
    
    
    17,731Securities held to maturity (fair value of $4,282
and $0, respectively)
    
    
    4,296
    
    
    
    Loans receivable
    
    
    254,760
    
    
    
    234,846Deferred loan fees and unamortized costs, net
    
    
    36
    
    
    
    90Less: allowance for loan losses
    
    
    (2,576
    )
    
    
    (2,371
    )Net loans
    
    
    252,220
    
    
    
    232,565Premises and equipment, net
    
    
    10,337
    
    
    
    10,284Accrued interest receivable
    
    
    1,360
    
    
    
    847Other assets
    
    
    1,733
    
    
    
    1,851TOTAL ASSETS
    
    $
    306,858
    
    
    $
    304,104LIABILITIES AND STOCKHOLDERS EQUITYLIABILITIES:Deposits:Non-interest bearing
    
    $
    34,904
    
    
    $
    28,187Savings and interest-bearing transaction accounts
    
    
    52,700
    
    
    
    60,289Time deposits under $100
    
    
    37,136
    
    
    
    41,855Time deposits $100 and over
    
    
    132,629
    
    
    
    123,675Total deposits
    
    
    257,369
    
    
    
    254,006Accrued interest payable and other liabilities
    
    
    1,237
    
    
    
    2,234TOTAL LIABILITIES
    
    
    258,606
    
    
    
    256,240Commitments and contingenciesStockholders equity:Common stock, no par value, authorized
20,000,000 shares; issued and outstanding
5,069,153 shares at June 30, 2009; and 5,065,283
shares at December 31, 2008
    
    
    47,385
    
    
    
    47,133Retained earnings
    
    
    986
    
    
    
    678Accumulated other comprehensive (loss)income
    
    
    (119
    )
    
    
    53TOTAL STOCKHOLDERS EQUITY
    
    
    48,252
    
    
    
    47,864TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
    
    $
    306,858
    
    
    $
    304,104
   3




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BANCORP OF NEW JERSEY, INC.
 
  For the Three Months Ended June 30,2009
    
    
    2008(In thousands, except per share data)INTEREST INCOMELoans, including fees
    
    $
    3,587
    
    
    $
    3,158Securities
    
    
    206
    
    
    
    229Federal funds sold
    
    
    16
    
    
    
    143TOTAL INTEREST INCOME
    
    
    3,809
    
    
    
    3,530INTEREST EXPENSESavings and money markets
    
    
    43
    
    
    
    305Time deposits
    
    
    1,445
    
    
    
    1,557TOTAL INTEREST EXPENSE
    
    
    1,488
    
    
    
    1,862NET INTEREST INCOME
    
    
    2,321
    
    
    
    1,668Provision for loan losses
    
    
    144
    
    
    
    67NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES
    
    
    2,177
    
    
    
    1,601NON-INTEREST INCOME  principally fees and service charges
    
    
    48
    
    
    
    81NON-INTEREST EXPENSESalaries and employee benefits
    
    
    911
    
    
    
    817Occupancy and equipment expense
    
    
    342
    
    
    
    275FDIC related expenses
    
    
    262
    
    
    
    36Data processing
    
    
    92
    
    
    
    80Professional fees
    
    
    111
    
    
    
    98Other expenses
    
    
    180
    
    
    
    197TOTAL NON-INTEREST EXPENSE
    
    
    1,898
    
    
    
    1,503Income before provision for income taxes
    
    
    327
    
    
    
    179Income tax expense
    
    
    136
    
    
    
    77NET INCOME
    
    $
    191
    
    
    $
    102PER SHARE OF COMMON STOCKBasic and diluted earnings
    
    $
    0.04
    
    
    $
    0.02
   4




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##### Table of Contents



BANCORP OF NEW JERSEY, INC.
 
  For the Six Months Ended June 30,2009
    
    
    2008(In thousands, except per share data)INTEREST INCOMELoans, including fees
    
    $
    6,963
    
    
    $
    6,301Securities
    
    
    385
    
    
    
    319Federal funds sold
    
    
    58
    
    
    
    639TOTAL INTEREST INCOME
    
    
    7,406
    
    
    
    7,259INTEREST EXPENSESavings and money markets
    
    
    167
    
    
    
    738Time deposits
    
    
    3,050
    
    
    
    3,339TOTAL INTEREST EXPENSE
    
    
    3,217
    
    
    
    4,077NET INTEREST INCOME
    
    
    4,189
    
    
    
    3,182Provision for loan losses
    
    
    205
    
    
    
    225NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES
    
    
    3,984
    
    
    
    2,957NON-INTEREST INCOME  principally fees and service charges
    
    
    86
    
    
    
    145NON-INTEREST EXPENSESalaries and employee benefits
    
    
    1,827
    
    
    
    1,658Occupancy and equipment expense
    
    
    684
    
    
    
    549FDIC related expenses
    
    
    303
    
    
    
    59Data processing
    
    
    171
    
    
    
    147Professional fees
    
    
    171
    
    
    
    208Other expenses
    
    
    377
    
    
    
    258TOTAL NON-INTEREST EXPENSE
    
    
    3,533
    
    
    
    2,879Income before provision for income taxes
    
    
    537
    
    
    
    223Income tax expense
    
    
    230
    
    
    
    109NET INCOME
    
    $
    307
    
    
    $
    114PER SHARE OF COMMON STOCKBasic and diluted earnings
    
    $
    0.06
    
    
    $
    0.02
   5




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BANCORP OF NEW JERSEY, INC.
 
  For the Six Months Ended June 30,2009
    
    
    2008(in thousands)CASH FLOWS FROM OPERATING ACTIVITIESNet income
    
    $
    307
    
    
    $
    114Adjustments to reconcile net income to net cash
Used in operating activities:Depreciation and amortization
    
    
    203
    
    
    
    170Provision for loan losses
    
    
    205
    
    
    
    225Recognition of stock option expense
    
    
    208
    
    
    
    193Fees earned from mortgage referrals
    
    
    
    
    
    
    (9
    )Changes in operating assets and liabilities:Increase in accrued interest receivable
    
    
    (513
    )
    
    
    (548
    )Decrease(increase) in other assets
    
    
    118
    
    
    
    (357
    )Decrease in other liabilities
    
    
    (997
    )
    
    
    (284
    )NET CASH USED IN OPERATING ACTIVITIES
    
    
    (469
    )
    
    
    (496
    )CASH FLOWS FROM INVESTING ACTIVITIESPurchases of securities available for sale, net
    
    
    (23,883
    )
    
    
    (23,905
    )Purchases of investment in bank stock
    
    
    (73
    )
    
    
    (18
    )Proceeds from sales or calls of securities available for sale
    
    
    17,391
    
    
    
    Purchases of securities held to maturity
    
    
    (4,296
    )Maturities of securities held to maturity
    
    
    
    
    
    
    2,000Net increase in loans
    
    
    (19,860
    )
    
    
    (23,480
    )Purchases of premises and equipment
    
    
    (256
    )
    
    
    (108
    )NET CASH USED IN INVESTING ACTIVITIES
    
    
    (30,977
    )
    
    
    (45,511
    )CASH FLOWS FROM FINANCING ACTIVITIESNet increase(decrease) in deposits
    
    
    3,363
    
    
    
    (2,364
    )Exercise of stock options
    
    
    23
    
    
    
    Exercise of warrants
    
    
    21
    
    
    
    530NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES
    
    
    3,407
    
    
    
    (1,834
    )Net decrease in cash and cash equivalents
    
    
    (28,039
    )
    
    
    (47,841
    )Cash and cash equivalents, beginning of year
    
    
    40,480
    
    
    
    66,115CASH AND CASH EQUIVALENTS, END OF PERIOD
    
    $
    12,441
    
    
    $
    18,274Cash paid during the period for:Interest
    
    $
    2,976
    
    
    $
    4,149Income taxes
    
    $
    501
    
    
    $
    263
   6




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BANCORP OF NEW JERSEY, INC.
 
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 Note 1. Significant Accounting Policies
 Basis of Financial Statement Presentation
        7




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Organization
   Note 2. Stockholders Equity and Related Transactions
  Note 3. Benefit Plans and Stock-Based Compensation
 2006 Stock Option Plan
    8




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2007 Director Plan
      9




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##### Table of Contents



Note 4. Earnings Per Share
 Basic earnings per share
 Diluted earnings per share
  For the Three Months EndedJune 30,(In thousands except per share data)
    
    2009
    
    
    2008Net income applicable to common stock
    
    $
    191
    
    
    $
    102Weighted average number of common
shares outstanding  basic
    
    
    5,069
    
    
    
    4,995Basic earnings per share
    
    $
    0.04
    
    
    $
    0.02Net income applicable to common stock
    
    $
    191
    
    
    $
    102Weighted average number of common
shares and common share equivalents 
diluted
    
    
    5,069
    
    
    
    5,351Diluted earnings per share
    
    $
    0.04
    
    
    $
    0.02
    10




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For the Six Months EndedJune 30,(In thousands except per share data)
    
    2009
    
    
    2008Net income applicable to common stock
    
    $
    307
    
    
    $
    114Weighted average number of common
shares outstanding  basic
    
    
    5,068
    
    
    
    4,988Basic earnings per share
    
    $
    0.06
    
    
    $
    0.02Net income applicable to common stock
    
    $
    307
    
    
    $
    114Weighted average number of common
shares and common share equivalents 
diluted
    
    
    5,068
    
    
    
    5,267Diluted earnings per share
    
    $
    0.06
    
    
    $
    0.02
    11




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Note 5. Comprehensive Income
  Three months ended June 30,2009
    
    
    2008Comprehensive IncomeNet income
    
    $
    191
    
    
    $
    102Unrealized holding loss on
securities available for sale, net of
taxes of $94 and $138 for 2009 and
2008, respectively
    
    
    (131
    )
    
    
    (191
    )Total comprehensive income
    
    $
    60
    
    
    $
    (89
    )
 Six months ended June 30,2009
    
    
    2008Comprehensive IncomeNet income
    
    $
    307
    
    
    $
    114Unrealized holding loss on
securities available for sale, net of
taxes of $79 and $90 for 2009 and 2008,
respectively
    
    
    (119
    )
    
    
    (130
    )Total comprehensive income
    
    $
    188
    
    
    $
    (16
    )
  12




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Note 6. Securities Available for Sale and Investment Securities
  Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairJune 30, 2009
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    ValueGovernment Sponsored Enterprise obligations
    
    $
    24,250
    
    
    $
    79
    
    
    $
    (277
    )
    
    $
    24,052
 Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairDecember 31, 2008
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    ValueGovernment Sponsored Enterprise obligations
    
    $
    17,641
    
    
    $
    90
    
    
    
    
    
    
    $
    17,731
   Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairJune 30, 2009
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    ValueMunicipal obligations
    
    $
    4,296
    
    
    
    
    
    
    $
    (14
    )
    
    $
    4,282
    13




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Securities Available for SaleAmortized
    
    
    FairCost
    
    
    ValueWithin 1 year
    
    
    
    
    
    
    1 to 5 years
    
    $
    17,000
    
    
    $
    16,9735 to 10 years
    
    $
    7,250
    
    
    $
    7,079$
    24,250
    
    
    $
    24,052
 Securities Held to MaturityAmortized
    
    
    FairCost
    
    
    ValueWithin 1 year
    
    $
    4,296
    
    
    $
    4,2821 to 5 years
    
    
    
    
    
    
    5 to 10 years
    
    
    
    
    
    
    $
    1,996
    
    
    $
    2,014
   14




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Note 7. Loans
  June 30,
    
    
    December 31,2009
    
    
    2008Real estate
    
    $
    172,012
    
    
    $
    159,058Commercial
    
    
    34,371
    
    
    
    33,319Credit lines
    
    
    43,924
    
    
    
    37,962Consumer
    
    
    4,453
    
    
    
    4,507$
    254,760
    
    
    $
    234,846
   15




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Three months ended
    
    
    Three months endedJune 30, 2009
    
    
    June 30, 2008Balance at beginning of period
    
    $
    2,432
    
    
    $
    2,070Provision charged to expense
    
    
    144
    
    
    
    67Loans charged off
    
    
    0
    
    
    
    0Recoveries
    
    
    0
    
    
    
    0Balance at end of period
    
    $
    2,576
    
    
    $
    2,137
 Six months ended
    
    
    Six months endedJune 30, 2009
    
    
    June 30, 2008Balance at beginning of period
    
    $
    2,371
    
    
    $
    1,912Provision charged to expense
    
    
    205
    
    
    
    225Loans charged off
    
    
    0
    
    
    
    0Recoveries
    
    
    0
    
    
    
    0Balance at end of period
    
    $
    2,576
    
    
    $
    2,137
   16




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##### Table of Contents



Note 8. Guarantees
  Note 9. Fair Value Measurements
    
    
    Level 1 Inputs Unadjusted quoted prices in active markets that are accessible at the
measurement date for identical, unrestricted assets or liabilities.
 
    
    Level 2 Inputs Quoted prices in markets that are not active, or inputs that are
observable either directly or indirectly, for substantially the full term of the asset or
liability.
 
    
    Level 3 Inputs Prices or valuation techniques that require inputs that are both
significant to the fair value measurement and unobservable (i.e. supported with little or
no market activity).
   17




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(Level 1)QuotedPrices in
    
    
    (Level 2)Active
    
    
    Significant
    
    
    (Level 3)Markets for
    
    
    Other
    
    
    SignificantJune 30,
    
    
    Identical
    
    
    Observable
    
    
    UnobservableDescription
    
    2009
    
    
    Assets
    
    
    Inputs
    
    
    InputsGovernment
Sponsored Enterprise
Obligations
    
    $
    24,052
    
    
    $
    
    
    
    $
    24,052
    
    
    $
    
 (Level 1)QuotedPrices in
    
    
    (Level 2)Active
    
    
    Significant
    
    
    (Level 3)Markets for
    
    
    Other
    
    
    SignificantDecember 31,
    
    
    Identical
    
    
    Observable
    
    
    UnobservableDescription
    
    2008
    
    
    Assets
    
    
    Inputs
    
    
    InputsGovernment
Sponsored Enterprise
Obligations
    
    $
    17,731
    
    
    $
    
    
    
    $
    17,731
    
    
    $
    
  (Level 1)QuotedPrices in
    
    
    (Level 2)Active
    
    
    Significant
    
    
    (Level 3)Markets for
    
    
    Other
    
    
    SignificantJune 30,
    
    
    Identical
    
    
    Observable
    
    
    UnobservableDescription
    
    2009
    
    
    Assets
    
    
    Inputs
    
    
    InputsImpaired loans
    
    $
    1,977
    
    
    $
    
    
    
    $
    
    
    
    $
    1,977
 (Level 1)QuotedPrices in
    
    
    (Level 2)Active
    
    
    Significant
    
    
    (Level 3)Markets for
    
    
    Other
    
    
    SignificantDecember 31,
    
    
    Identical
    
    
    Observable
    
    
    UnobservableDescription
    
    2008
    
    
    Assets
    
    
    Inputs
    
    
    InputsImpaired loans
    
    $
    1,977
    
    
    $
    
    
    
    $
    
    
    
    $
    1,977
  18




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Cash and Cash Equivalents (Carried at cost)
  Securities
  Restricted Investment in Bank Stock (Carried at Cost)
  Loans Receivable (Carried at Cost)
   19




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Impaired loans
 Accounting
by Creditors for Impairment of a Loan (SFAS 114)
 Accrued Interest Receivable and Payable (Carried at Cost)
  Deposits (Carried at Cost)
  Federal Funds Purchased and Short-Term Borrowings (Carried at Cost)
   20




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June 30, 2009
    
    
    December 31, 2008Carrying
    
    
    Estimated
    
    
    Carrying
    
    
    Estimatedamount
    
    
    Fair Value
    
    
    amount
    
    
    Fair ValueFinancial assets:Cash and cash equivalents
    
    $
    12,441
    
    
    $
    12,441
    
    
    $
    40,480
    
    
    $
    40,480Securities available for sale
    
    
    24,250
    
    
    
    24,052
    
    
    
    17,641
    
    
    
    17,731Securities held to maturity
    
    
    4,296
    
    
    
    4,282
    
    
    
    
    
    
    
    Restricted investment in bank stock
    
    
    419
    
    
    
    419
    
    
    
    346
    
    
    
    346Net loans
    
    
    252,220
    
    
    
    252,374
    
    
    
    232,565
    
    
    
    232,744Accrued interest receivable
    
    
    1,360
    
    
    
    1,360
    
    
    
    847
    
    
    
    847Financial liabilities:Deposits
    
    
    257,369
    
    
    
    259,726
    
    
    
    254,005
    
    
    
    255,935Federal funds purchased
    
    
    
    
    
    
    
    
    
    
    853
    
    
    
    853Accrued interest payable
    
    
    587
    
    
    
    587
    
    
    
    541
    
    
    
    541
 Limitation
    21




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Note 10. Recent Accounting Pronouncements
 Determining Fair Value When the Volume and Level of Activity for the Asset or
Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly
      22




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23




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ITEM 2
Managements Discussion and Analysis of
Financial Condition and Results of Operations
  Statements Regarding Forward Looking Information
     24




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Critical Accounting Policies, Judgments and Estimates
  Allowance for Loan Losses
  Deferred Income Taxes
   25




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Results of Operations
 Three Months Ended June 30, 2009 and 2008 and Six Months Ended June 30, 2009 and 2008
  Net Income
    Net Interest Income
    26




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Provision for Loan Losses
  Non-interest Income
  Non-interest Expense
   Income Tax Expense
  FINANCIAL CONDITION
   27




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Loans
    10-Q.
  28




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Loan Quality
      Investment Securities
  Deposits
   29




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Liquidity
     Capital Resources
     30




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MinimumJune 30,
    
    
    Regulatory2009
    
    
    RequirementsRisk-Based Capital:Tier 1 Capital Ratio
    
    
    19.49
    %
    
    
    4.0
    %Total Capital Ratio
    
    
    20.53
    %
    
    
    8.0
    %Leverage Ratio
    
    
    15.31
    %
    
    
    4.0
    %
    31




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##### Table of Contents



ITEM 3. Quantitative and Qualitative Disclosures about Market/Interest Risk
  
 ITEM 4. Controls and Procedures
 Evaluation of disclosure controls and procedures.
   Changes in internal controls over financial reporting.
   32




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##### Table of Contents



PART II OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Securities Holders
  DIRECTOR NAME
    
    YEAR TERM EXPIRES
    
    
    VOTES FOR
    
    
    WITHHELDMichael Bello
    
    
    2012
    
    
    
    3,393,156
    
    
    
    13,542Jay Blau
    
    
    2012
    
    
    
    3,402,653
    
    
    
    4,045Albert F. Buzzetti
    
    
    2012
    
    
    
    3,403,553
    
    
    
    3,145Albert L. Buzzetti
    
    
    2012
    
    
    
    3,404,853
    
    
    
    1,845Gerald A. Calabrese, Jr.
    
    
    2012
    
    
    
    3,400,461
    
    
    
    6,237Stephen Crevani
    
    
    2012
    
    
    
    3,405,153
    
    
    
    1,545
  
 Item 5. Other Information
  
 Item 6. Exhibits
   33




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##### Table of Contents



SIGNATURES
  Bancorp of New Jersey, Inc.Date:      August 14, 2009
    By:
    /s/ Albert F. BuzzettiAlbert F. BuzzettiChairman and Chief Executive Officer
(Principal Executive Officer)By:
    /s/ Michael LeslerMichael LeslerPresident and Chief Operating Officer
(Principal Financial Officer)  34




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description31.1
    
    
    Rule 13a-14(a) Certification of the Principal Executive Officer31.2
    
    
    Rule 13a-14(a) Certification of the Principal Financial Officer32
    
    
    Section 1350 Certifications
  35