UPDATE: Brunswick Bancorp, Brunswick, NJ (BRBW)

Four hundred and fifty five days after my April 2017 Review of Brunswick Bancorp, head scoundrel Roman Gumina met his Maker.

In death there is hope! If Roman's successor Uncle Frank Junior can right side the bank's expenses, it's entirely plausible we could see a resurrection of BRBW share price to $14. Were Uncle Frankie to sell the bank, Brunswick stock could conceivably garner the same.

Question is, how much of Roman Gumina's greed is embodied in the bank's operational design and family management DNA? In his wake, is BRBW a bargain buy or a pile of dead money?

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


Prospective Buyers
Still true today: The $95M of deposits in Brunswick's Livingston Ave branch headquarters might be appealing to area institutions, but I doubt any buyer would be interested in the 4 out of 7 other branches struggling to manage less than $9M each.

Amboy Bancorp, Old Bridge, NJ (private)
Magyar Bancorp, New Brunswick, NJ (MGYR)
Provident Financial Services, Iselin, NJ (PFS)

Financial Snapshot
†as of 06/30/2018
Total assets:
$187M†
Tangible book value per share:     
$12.50†
NPAs to assets:
4.6%†
Price to book:
70%
Market cap:
$26.5M
Dividend yield:
0%
Trailing 12-month ROA:
0.3%†
Trailing 12-month ROE:
1.7%†

Scoundrels
Frank Gumina, Jr, Interim Chairman
Nicholas A. Frungillo, Jr, President and CEO
Frank J. Gumina III, Esq, Vice President, Bank Counsel

Red Flag
My concerns about Brunswick Bank & Trust are essentially unchanged since my April 2017 review.
  1. The bank's expenses are way out of line with industry norms or anything justifiable (see table below).
  2. Roman Gumina owned at least 10 unrelated entities, and money is still flowing from the bank to some of them.
  3. More than half the bank's branches are too small to be profitable, and should be closed.
  4. NPA's are 4x current industry average.
Here's what I'd love to see Management do (and, what fiscal responsibility requires):
  • Cut Occupancy and Other Expenses in half! That alone should add $450K to pre-tax earnings and produce triple last quarter’s earnings.
  • Cut the asking price of REO low enough to sell it, then put the proceeds into earning assets. That could add another $160K to the pre-tax income.
  • Don't spend the late Gumina’s $310,000/year salary on anyone or anything new. That's cash straight to the bottom line.
  • Do these three things, and watch earnings rise six-fold!
How Brunswick Bank's expenses compare to peers'.

Brunswick Bank & Trust Expenses are more than double what they should be!


1 not including rent charged for Bank use of Gumina properties
2 a Timyan Bank Alert favorite in NJ
3 in the two quarters prior to close of merger with SB One Bancorp (SBBX)

Sources
  • Confidential interviews with shareholders and analysts
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8 comments :

  1. UnknownAugust 26, 2018 at 1:55 PM

    Your disrespect for the dead is disgusting. You may not have liked the guy but have some respect for his grieving family.

    ReplyDelete
    Replies
    1. Phil TimyanSeptember 3, 2018 at 3:40 AM

      Dear Unkown,
      Thank you for reading and commenting. If you have information that suggests my read on Mr Gumina is wrong, I am open to listening and to making amends if appropriate. Meantime, I will continue to take a stand for the hundreds of folks who have been harmed by this enterprise, and I remain hopeful that his family members and successors will do what’s right by others.
      Best,
      Phil

      Delete
  2. UnknownAugust 30, 2018 at 2:27 PM

    This article is sickening. Shame on you Timyan.

    ReplyDelete
    Replies
    1. Phil TimyanSeptember 3, 2018 at 3:48 AM

      Hi George! Are you the Talj who once worked at Brunswick Bank as a teller, or is that your son?

      In any case, thank you for reading and commenting. If you have information that suggests my read on Mr Gumina is wrong, I am open to listening and to making amends if appropriate. Meantime, I will continue to take a stand for the hundreds of folks who have been harmed by this enterprise, and I remain hopeful that his family members and successors will do what’s right by others.

      Best,
      Phil

      Delete
    2. UnknownSeptember 3, 2018 at 3:26 PM

      Phil,
      Yes I am that George Talj that worked at Brunswick Bank beginning as a Teller, later as a CSA at the Englishtown Branch and I am Romans nephew. I asked my Uncle Roman for that position because I was in college and in need of a job while I was in school. If not for him, my career would not be where it is today. This is only one of the many testimonies of his kindness.

      That being said, I respect your blog and your defense of people that have been wronged by small banks. I appreciate your passion in “calling out” those Bank leaders who you feel having wronged so many. I only ask that you retract the personal attacks on a man that has helped a community of people and his advised students at a local University, because it does no good to attack a person whose family is still grieving. To call him a “scoundrel,” “greedy,” is far from the truth because this man Roman Gumina, helped so many in need with charitable works and money from his own pockets that do not need to be discussed here, but for your sake, maybe they should. On a personal level, this man adopted children, cared for the poor, educated and helped those in need of work when they needed. If they only asked him, he would was always there.

      Yes the bank is not where it used to be and yes former workers have legitimate complaints, but so many have also been helped by Romans leadership than hurt and I have accounts that would bring this reply to the bottom of your page.

      If you stuck to the facts here your article would have much more merit. I only ask that you continue to stick to the facts as you have for the most part, but to please retract the accusations of Roman being a Scoundrel and Greedy and focus on the banks numbers. No one is perfect, not I, not you, nor was Uncle Roman but It would certainly mean a lot to the family who’s suffering tremendously right now, who is also reading your post, if you would kindly remove the personal attacks

      Sincerely,
      George Talj nephew of Roman Gumina

      Delete
    3. Phil TimyanSeptember 5, 2018 at 6:55 AM

      Dear George,
      Again, thank you for reading and thank you for the comments. I am glad to hear of the good and redeeming side of your Uncle Roman. It looks to me like you are a caring and successful man. I am glad he helped you become that. I’m also happy to learn he helped many others. I’m sure he was proud of you. And I know your other relatives are as well. Kudos to you for taking a stand and telling your story.
      To those grieving his passing I offer my condolences.
      At the end of the day, I think it would be better if banks like Brunswick Bank & Trust were completely privately held. Then the owners can run them as they please and do what they like with the profits.
      Best,
      Phil

      Delete
  3. UnknownSeptember 11, 2018 at 11:22 AM

    Thank you Phil.

    ReplyDelete
  4. UnknownSeptember 18, 2018 at 2:51 PM

    Thank you both for the constructive, respectful and civil conversation. It's a refreshing break from almost all comment boards I've seen.

    ReplyDelete

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