Harvest Community Bank, Pennsville, NJ (HCBP)

A Case of Self-Dealing on the Banks of the Delaware River


Wouldn’t shareholders of Harvest Community be best served by a sale, e.g., at 120% of book value, $15/share? From a stock that’s trading at $3.5, looks to me like shareholders could make a 300% return if they could convince the bank board to do the right thing, instead of wallowing around between $3 and $5 per share while officers and directors line their own pockets.


Disclosure: As of this posting, I own significant shares of HCBP and may subsequently either dispose of them or purchase more.

Prospective Buyers
Penn Bancshares, Pennsville, NJ (PEBA) In late 2005, the Fed gave PEBA permission to buy up to 24.89% of Harvest Community Bank
Elmer Bancorp, Elmer, NJ (ELMA), a local bank that’s doing well for which this acquisition would represent a great in-market transaction
Fulton Financial, Lancaster, PA (FULT), also has branch overlap that would make an acquisition like this logical
Financial Snapshot
(as of 12/31/2011)

Total assets:

$191,554,000
Tangible book value per share:
$12.76
NPAs to assets:
6.7%
Price to book:
37.6%
Market cap:
$5.5M
Dividend yield:
$0.00
Trailing 12-month return on assets:
-1.05%
Trailing 12-month return on equity:
-12.6%
Scoundrels
Michael Williams, Chairman of the Board
Dennis Engle, CEO
Jenny Engle, CEO’s wife
Entire Board of Directors, the 12 joint owners of Wheat Properties LLC
Red Flags
CEO Dennis Engle only owns 1050 shares of stock outright, and was paid $188K in 2011
Engle led shareholders to believe Harvest Community Bank was having a great Q4 2011, when in fact it lost $4.2M pretax, a loss greater than the previous five years' earnings combined
The Directors as a group own an entity called Wheat Properties LLC, which purchased the branch building in Salem City on October 20, 2000 for $240,000, for which the bank pays $79,925 per year in rent — a nice fat 33% annual return for the Directors.
Google searches for "Wheat Properties" suggest great efforts have taken to keep the entity under the radar, and reveal little, other than:
Wheat Properties - one way Harvest Community Bank Directors screw shareholders
Harvest Community used one of its Director’s law firms, which billed it $187,393 over the last two years.
The bank also made payments to JKE Marketing—a company owned by Dennis Engle’s wife Jenny Engle—of $88,020 over the last two years. Is this President’s Message from the bank homepage the sort of thing Jenny Engle is getting $44,000 a year to produce for shareholders, I wonder?

Shareholders getting shallow message from Harvest Community Bank President
Sources
* NOTE: Although public companies usually readily post their annual reports and proxy statements on their websites, Harvest chooses not to. If you'd like your own copy, you'll need to contact rturmol@harvestcommunitybank.com

4 comments :

  1. This could not possibly be true, but if it is true, the guys running Harvest Community Bank in New Jersey should be taken to the top of the Empire State Building, it’s not that far away, doused in gasoline and hung from the gargoyles. Their screams of agony would be music to shareholders’ ears the world over. They have turned $10.00 into $3.75 while Penn Bancshares has made money all the way through the recession. No way did Penn offer $15.00 a share and the directors turned it down. Is this for real? Penn Bancshares is a great community bank that serves the community well. This can not be. If this is true, it should be illegal. Tell us it isn’t so. Tell us that the directors of Harvest are not this evil and corrupt. We have suffered long with these fools. Will our pain never end?

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  2. I'd do the jenny engle stuff for $43k. Doubtful fult would bother with this entity though.

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  3. In April of 1999 I purchased 100 IPO COMMON SHARES FROM THE HARVEST COMMUNITY BANK per share minimum offering price $10.00 , underwriting Commision -0- Proceed to bank $10.00. After much thought concerning this investment I deceided to just cut my losses and chalk it up to experiece. So I call the Bank in Pinnsville N.J after being put on hold for several minutes I was informed by Mr Frank McEntee, an officer of the bank as to what I would have to do in order, to liquidated my shares. Which I did, I had to go to my bank and get the share certificated stamped with a medellion seal then sign and date the original share certificate. I than sent the information by Certified Mail return receipt request. I never received any correspondence from Harvest Community Bank acknowledging that this information was received .Thank GOD for certified mail !! I wrote them again on April.2015. Concerning the above. To date I have not received even a post it from this institution. Now they hold my certificate of shares and I just don't what to do. I am senior citizen living on a fixed income and thought by investing into Harvest Communty Bank that I might have a little nest egg put away. Now I know I was just a
    OLD FOOL.If anyone can can help me with my dillemma I would be most appreciative.

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    Replies
    1. Dear Carmen,

      I'm so sorry about your experience with Harvest. And, to any investors who have followed me into the HCBP den of thieves, I also apologize.

      McEntee's failure to respond is inexcusable. I can tell you that he refuses to respond to my and other investor communications, as does Chairman Michael Williams. To increase likelihood of a response, I recommend sending another communication and cc-ing the Office of the Comptroller of the Currency at 1150 Northbrook Dr. Suite 303, Trevose, PA 19053

      Good luck! You deserve better.

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