Attached files
| file | filename |
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| 8-K - FORM 8-K - CF BANKSHARES INC. | c98323e8vk.htm |
Exhibit 99
PRESS RELEASE
FOR IMMEDIATE RELEASE:
|
March 26, 2010 | |
For Further Information:
|
Mark S. Allio, Chairman, President and CEO | |
| Phone: 330.576.1334 | ||
| Fax: 330.666.7959 |
CENTRAL FEDERAL CORPORATION ANNOUNCES 2009 PERFORMANCE
Fairlawn, Ohio — March 26, 2010 — Central Federal Corporation (Nasdaq: CFBK) announced a net loss
of $9.9 million, or $2.51 per diluted common share for the year ended December 31, 2009. The net
loss compares to net income of $723,000, or $.17 per diluted common share in 2008. The 2009 net
loss was primarily due to a $9.9 million provision for loan losses and a $4.3 million valuation
allowance related to the deferred tax asset.
For the quarter ended December 31, 2009, the net loss totaled $2.2 million, or $.56 per diluted
common share, compared to net income of $90,000, or $.01 per diluted common share, for the quarter
ended December 31, 2008. The net loss for the fourth quarter of 2009 was primarily due to a $3.2
million provision for loan losses.
Despite the net loss, CFBank remains well-capitalized for regulatory purposes with a core capital
ratio of 8.90% and total risk-based capital ratio of 11.70% as of December 31, 2009.
The provision for loan losses was recorded in response to continuing adverse economic conditions
affecting loan performance, which resulted in an increase in nonperforming loans and loan
charge-offs. Nonperforming loans increased $10.8 million, and totaled $13.2 million at December
31, 2009, compared to $2.4 million at December 31, 2008. Net loan charge-offs increased $5.4
million, and totaled $5.9 million during 2009, compared to $482,000 in 2008. The provision in 2009
was significantly impacted by a $3.3 million net charge-off related to a single commercial loan
customer.
The net loan charge-offs reduced the Company’s near term estimates of future taxable income and the
amount of the deferred tax asset, primarily related to net operating loss carryforwards, considered
realizable. The Company recorded a $4.3 million valuation allowance to reduce the carrying amount
of the deferred tax asset to zero at December 31, 2009. We will recognize the tax benefits to the
extent we have taxable income in future years.
Other Information:
| • | We continue to execute on our business plan and the commitment to use the Troubled Asset
Relief Program (TARP) Capital Purchase Program funds to make financing available to
businesses and consumers in our communities. Loan originations totaled $108.9 million
since our receipt of the TARP funds on December 5, 2008 through December 31, 2009, and
included $73.5 million in single-family mortgage loans and $34.6 million in commercial,
commercial real estate and multi-family mortgage loans. |
||
| • | Net gains on sales of loans increased 304% and mortgage loans originated for sale
increased 144% in 2009 compared to 2008. |
4
| • | The ratio of noninterest expense to average assets improved in each quarter during 2009,
decreasing from 3.04% in the 1st quarter of 2009 to 2.63% in the fourth quarter
of 2009. |
||
| • | The efficiency ratio improved in each quarter during 2009, decreasing from 92.92% in the
1st quarter of 2009 to 67.69% in the 4th quarter of 2009. |
Net interest income
Net interest income for the quarter ended December 31, 2009 increased $68,000, or 3.1%, over the
same period last year and totaled $2.2 million. The increase in net interest income was due to a
higher net interest margin in the fourth quarter of 2009. The increase in net interest margin was
driven by the fact that the average cost of interest-bearing liabilities decreased by 100 basis
points (bp) in the fourth quarter of 2009 compared to the fourth quarter of 2008, while the average
yield on interest-earning assets decreased by only 85 bp.
Net interest income for the year decreased $203,000, or 2.3%, to $8.5 million. This was the result
of lower net interest margin for 2009 compared to the prior year as a result of a larger decrease
in the average yield on interest-earning assets (down 107 bp) than in the average cost of
interest-bearing liabilities (down 88 bp). The average yield on interest-earning assets was
reduced in 2009 by approximately 25 bp due to interest foregone on nonperforming loans.
The average yield on interest-earning assets decreased to 5.31% in the fourth quarter of 2009,
compared to 6.16% in the fourth quarter of 2008. The average yield on interest-earning assets
decreased to 5.34% for the year ended December 31, 2009, compared to 6.41% for the year ended
December 31 2008. The decrease in yield on interest-earning assets for both the quarter and year
ended December 31, 2009 was due to an increase in nonperforming loans and downward repricing on
adjustable-rate assets, as well as lower pricing on new loan production, in response to low market
interest rates. The decline in the average yield on interest-earning assets resulted in a decrease
in total interest income of 12.2% for the quarter and 13.2% for the year.
The average cost of interest-bearing liabilities also decreased, declining to 2.20% in the fourth
quarter from 3.20% in the fourth quarter of 2008. The average cost of interest-bearing liabilities
also decreased for the year, declining to 2.50% for 2009 from 3.38% for 2008. The decrease in cost
of interest-bearing liabilities for both the quarter and year was due to a decline in deposit and
borrowing costs, which reflected the sustained low market interest rate environment that existed in
2009. The decrease in the average cost of interest-bearing liabilities resulted in a decrease in
total interest expense of 30.3% for the fourth quarter of 2009 and 25.1% for the year.
Net interest margin for the quarter increased to 3.37%, compared to 3.33% in the fourth quarter of
2008. Net interest margin for the year was 3.14%, compared to 3.35% in 2008.
Noninterest income
Noninterest income for the fourth quarter totaled $477,000 and increased $113,000, or 31.0%. The
increase was due to a $112,000 increase in net gains on sales of loans and a $208,000 gain on the
Company’s purchase of the remaining two-thirds interest in Smith Ghent LLC. These increases were
partially offset by a $197,000 decrease in service charges on deposit accounts.
Noninterest income for the year totaled $1.4 million and increased $429,000, or 45.3%. Net gains
on sales of loans increased by $483,000 during 2009. Also contributing to the increase was the
$208,000 gain on the Company’s purchase of the remaining two-thirds interest in Smith-Ghent LLC.
These increases were partially offset by a $199,000 decrease in service
charges on deposit accounts. Noninterest income in 2008 also included $54,000 in net gains on
sales of securities. There were no security sales in 2009.
5
Net gains on the sales of loans in the fourth quarter totaled $141,000, an increase of $112,000
over the same period in 2008. The increase was due to a 169.8% increase in mortgage loans
originated for sale, which totaled $14.3 million in this year’s fourth quarter, compared to $5.3
million in the fourth quarter of 2008. Net gains on the sales of loans for the year totaled
$642,000 and increased $483,000, or 303.8%, over 2008. The year-over-year increase was due to a
$66.0 million, or 144.4%, increase in mortgage loans originated for sale. This increase in
mortgage loan production was driven by management’s decision to increase CFBank’s staff of
professional mortgage loan originators, who have been successful in increasing this business
despite the depressed condition of the housing market and also by consumers taking advantage of low
mortgage rates. CFBank’s mortgage professionals continue to gain market share by building
relationships with local realtors as well as building the ability to originate loans on a
nation-wide basis.
The $208,000 net gain on acquisition was due to recognition, at fair value, of the Company’s
one-third ownership interest in Smith-Ghent LLC, which was held prior to its purchase of the
remaining two-thirds interest in October 2009.
Service charges on deposit accounts totaled $87,000 in the fourth quarter of 2009 and $345,000 for
the year, both decreases from the comparable prior year periods. Virtually all of the decrease
related to the fourth quarter and was driven by loss of income related to certain, deposit accounts
of a third party payment processor that were not active in 2009.
Provision for loan losses
Provisions for loan losses are provided based on management’s estimate of probable incurred credit
losses in the loan portfolio and the resultant allowance for loan losses (ALLL) required.
Management analyzes the adequacy of the ALLL quarterly through reviews of the loan portfolio.
Based on its review as of the end of fiscal 2009, management increased the provision to a total of
$3.2 million for the fourth quarter of 2009 and $9.9 million for the year. This compares to a
provision of $250,000 and $917,000 for the quarter and year, respectively, ended December 31, 2008.
The increase in the provision for both the quarter and the year was due to continued adverse
economic conditions affecting loan performance, which resulted in an increase in nonperforming
loans and loan charge-offs. The ratio of the allowance for loan losses to total loans totaled 2.98%
at December 31, 2009, compared to 1.32% at December 31, 2008.
Nonperforming loans, which are nonaccrual loans and loans at least 90 days past due but still
accruing interest, increased $10.8 million and totaled $13.2 million, or 5.56% of total loans, at
December 31, 2009, compared to $2.4 million, or 1.02% of total loans, at December 31, 2008. The
increase in nonperforming loans was primarily related to the multi-family residential, commercial
real estate, and home equity lines of credit portfolios.
Individually impaired loans totaled $13.7 million at December 31, 2009, compared to $2.3 million at
December 31, 2008. All but $1.3 million of this total is included in nonperforming loans. The
$1.3 million not included relates to certain troubled debt restructurings where customers have
established a sustained period of repayment performance, loans are current according to their
modified terms, and repayment of the remaining contractual payments is expected. The amount of the
ALLL specifically allocated to individually impaired loans totaled $2.0 million at December 31,
2009, compared to $514,000 at December 31, 2008.
Net charge-offs totaled $5.9 million, or 2.48% of average loans in 2009, compared to $482,000, or
0.21% of average loans in 2008. Net commercial loan charge-offs in 2009 included $3.3 million
related to a single commercial loan customer. The increase in net charge-offs in 2009
was primarily in the commercial and commercial real estate portfolios. Net charge-offs in 2008
related primarily to home equity lines of credit.
6
Noninterest expense
Noninterest expense decreased $332,000, or 15.3%, to $1.8 million for the quarter ended December
31, 2009, compared to $2.2 million for the quarter ended December 31, 2008. The decrease was
primarily due to a reduction in salaries and employee benefits and in data processing expense. For
the year, noninterest expense increased $513,000, or 6.6%, to a total of $8.3 million. The
increase in noninterest expense was primarily due to an increase in FDIC premiums, salaries and
employee benefits and professional fees, partially offset by a decrease in depreciation expense.
Salaries and employee benefits decreased $132,000, or 12.9%, and totaled $890,000 for the fourth
quarter, primarily as a result of the elimination of bonuses. For the year, however, salaries and
employee benefits expense increased $108,000, or 2.7%. The increase was due to increased staffing
levels, salary adjustments and medical benefits expense, offset partially by the elimination of
bonuses.
Data processing expense decreased $105,000, or 39.5%, and totaled $161,000 for the fourth quarter.
Data processing expense in the fourth quarter of 2008 included expenses related to deposit accounts
of a third party payment processor, and those accounts were not active in 2009.
FDIC premiums increased $455,000 and totaled $541,000 for the year ended December 31, 2009. The
increase was due to higher quarterly assessment rates, an increase in deposit balances, and a
$128,000 special assessment to restore the reserve ratio of the Deposit Insurance Fund. Also, a
one-time FDIC credit issued to CFBank as a result of the Federal Deposit Insurance Reform Act of
2005 reduced premiums in 2008.
Professional fees increased $211,000, or 37.8%, and totaled $769,000 for the year ended December
31, 2009. The increase was due to $99,000 higher legal fees related to nonperforming loans and
$142,000 in legal and forensic accounting services related to the investigation of unusual return
item activity involving deposit accounts for a third party payment processor. The increases were
partially offset by a $36,000 decrease in consulting fees related to the Company’s implementation
of the internal control reporting requirements of Section 404 of the Sarbanes-Oxley Act.
Depreciation expense decreased $200,000, or 29.3%, and totaled $483,000 for the year ended December
31, 2009, compared to $683,000 for the year ended December 31, 2008. The decrease was due to
assets fully depreciated at December 31, 2008.
The ratio of noninterest expense to average assets improved to 2.63% in the fourth quarter of 2009,
from 3.13% in the fourth quarter of 2008. The efficiency ratio improved to 67.69% in the fourth
quarter of 2009, from 85.89% for the fourth quarter of 2008. For the year, the ratio of
noninterest expense to average assets increased to 2.88% in 2009, from 2.79% in 2008. The
efficiency ratio increased to 83.60% in 2009, from 80.75% in 2008. The increase in both ratios was
due to the increase in noninterest expense in 2009.
Income taxes
The Company realized an income tax benefit for the fourth quarter of $180,000 and expense for the
year of $1.6 million. In 2008, it had income tax expense of $17,000 in the fourth quarter and
$261,000 for the year. The tax benefit in the fourth quarter related to the valuation allowance on
the deferred tax asset and its affect on deferred tax liabilities associated with unrealized gains
on securities available for sale. The increase in the income tax expense for the year was due to
the $4.3 million valuation allowance against the deferred tax asset, discussed previously.
7
Balance sheet activity
Assets totaled $273.7 million at December 31, 2009 and decreased $4.1 million, or 1.5%, from $277.8
million at December 31, 2008. The decrease was primarily due to a $2.8 million decrease in net
loan balances as a result of net loan charge-offs and an increase in the ALLL, and a $1.6 million
decrease in the deferred tax asset due to the valuation allowance recorded in 2009.
Net loans totaled $231.1 million at December 31, 2009 a decrease of $2.8 million, or 1.2%, from
$233.9 million at December 31, 2008. The decrease was primarily due to the increase in the ALLL
and net loan charge-offs during 2009. Commercial, commercial real estate and multi-family loans
totaled $181.8 million at December 31, 2009, essentially unchanged from the end of 2008. Mortgage
loans totaled $30.6 million at December 31, 2009 and increased $1.7 million, or 6.1%, from $28.9
million at December 31, 2008. The increase in mortgage loans was due to an increase in loans
originated for portfolio and $1.9 million in loans transferred from loans held for sale to
portfolio. Consumer loans totaled $26.0 million at December 31, 2009 and decreased $399,000, or
1.5%, from $26.4 million at December 31, 2008. The decrease was due to repayments of auto and home
equity lines of credit, partially offset by the purchase of $2.2 million in auto loans.
Premises and equipment, net, totaled $7.0 million at December 31, 2009, which was an increased of
$1.8 million, or 33.5%, from $5.2 million at December 31, 2008. The increase was primarily due to
the purchase of the Company’s headquarters building in Fairlawn through the acquisition of the
remaining two-thirds interest in Smith-Ghent LLC, partially offset by current year depreciation.
Deposits totaled $211.1 million at December 31, 2009, an increase of $3.5 million, or 1.7%, from
$207.6 million at December 31, 2008. The increase was due to an $18.9 million increase in money
market account balances, a $2.5 million increase in noninterest bearing checking account balances,
a $508,000 increase in interest bearing checking accounts, and a $309,000 increase in savings
accounts. Certificate of deposit accounts decreased $18.8 million during 2009.
Money market account balances increased $18.9 million in 2009 due to competitive rates offered by
CFBank and the transfer of maturing certificate of deposit balances by customers seeking increased
liquidity and higher yields. Noninterest bearing checking account balances increased $2.5 million
in 2009 as a result of management’s continued focus on building complete banking relationships with
commercial clients.
CFBank is a participant in the Certificate of Deposit Account Registry Service® (CDARS), a network
of banks that allows us to provide our customers with FDIC insurance coverage on certificate of
deposit balances up to $50 million. Customer balances in the CDARS program decreased $11.0 million
and totaled $37.4 million at December 31, 2009. The current year decrease in CDARS account
balances was a result of customers transferring these funds into more liquid accounts, including
the money market account. CDARS balances are considered brokered deposits by regulations. Not
considering CDARS deposits, brokered deposits totaled $8.8 million at December 31, 2009 and
decreased $15.0 million, or 63.2%, from the end of 2008. The decrease in brokered deposits was
based on CFBank’s asset liability management strategies and a decrease in CFBank’s funding
requirements for loan growth in 2009.
Short-term FHLB advances totaled $2.1 million at December 31, 2009 a decrease of $3.8 million from
December 31, 2008. Short-term advances were repaid with funds from the increase in deposits and
cash flows from the securities portfolio. Long-term FHLB advances totaled $29.9 million at
December 31, 2009 and increased $6.7 million, or 29.1%, during 2009. The increase in long-term
FHLB advances resulted from management’s decision, as part of the Company’s asset liability
management program, to use these advances to extend the terms of
liabilities and fix their cost at the current low interest rates to protect net interest margin
should interest rates rise.
8
Stockholders’ equity totaled $23.2 million at December 31, 2009, which represented a decrease of
$9.8 million, or 29.8%, compared to equity of $33.1 million at December 31, 2008. The decrease
was due to the current year net loss, partially offset by a $354,000 increase in the market value
of the securities portfolio.
About Central Federal Corporation and CFBank
Central Federal Corporation is the holding company for CFBank, a federally chartered savings
association formed in Ohio in 1892. CFBank has four full-service banking offices in Fairlawn,
Calcutta, Wellsville and Worthington, Ohio. Additional information about CFBank’s banking services
and the Company is available at www.CFBankOnline.com.
Forward-Looking Information
Statements in this earnings release that are not statements of historical fact are forward-looking
statements. Forward-looking statements include, but are not limited to: (1) projections of
revenues, income or loss, earnings or loss per common share, capital structure and other financial
items; (2) plans and objectives of the Company, as defined below, or its management or Board of
Directors; (3) statements regarding future events, actions or economic performance; and (4)
statements of assumptions underlying such statements. Words such as “estimate,” “strategy,” “may,”
“believe,” “anticipate,” “expect,” “predict,” “will,” “intend,” “plan,” “targeted,” and the
negative of these terms, or similar expressions, are intended to identify forward-looking
statements, but are not the exclusive means of identifying such statements. Various risks and
uncertainties may cause actual results to differ materially from those indicated by our
forward-looking statements. Such differences could be caused by factors including, but not limited
to: (i) changes in political, economic or other factors such as inflation rates, recessionary or
expansive trends, and taxes; (ii) competitive pressures; (iii) fluctuations in interest rates; (iv)
the level of defaults and prepayments on loans made by CFBank; (v) unanticipated litigation, claims
or assessments; (vi) fluctuations in the cost of obtaining funds to make loans; and (vii)
regulatory changes. Further information on these risk factors is included in the Company’s filings
with the Securities and Exchange Commission. Forward-looking statements are not guarantees of
performance or results. A forward-looking statement may include a statement of the assumptions or
bases underlying the forward-looking statement. The Company believes it has chosen these
assumptions or bases in good faith and that they are reasonable. We caution you however, that
assumptions or bases almost always vary from actual results, and the differences between
assumptions or bases and actual results can be material. The forward-looking statements included
in this earnings release speak only as of the date they are made. We undertake no obligation to
publicly release revisions to any forward-looking statements to reflect events or circumstances
after the date of such statements, except to the extent required by law.
9
| Consolidated Statements of Operations | Three months ended | Twelve months ended | ||||||||||||||||||||||
| ($ in thousands, except share data) | December 31, | December 31, | ||||||||||||||||||||||
| (unaudited) | 2009 | 2008 | % change | 2009 | 2008 | % change | ||||||||||||||||||
Total interest income |
$ | 3,520 | $ | 4,010 | -12 | % | $ | 14,446 | $ | 16,637 | -13 | % | ||||||||||||
Total interest expense |
1,286 | 1,844 | -30 | % | 5,947 | 7,935 | -25 | % | ||||||||||||||||
Net interest income |
2,234 | 2,166 | 3 | % | 8,499 | 8,702 | -2 | % | ||||||||||||||||
Provision for loan losses |
3,245 | 250 | n/m | 9,928 | 917 | n/m | ||||||||||||||||||
Net interest income after provision for loan losses |
(1,011 | ) | 1,916 | -153 | % | (1,429 | ) | 7,785 | -118 | % | ||||||||||||||
Noninterest income |
||||||||||||||||||||||||
Service charges on deposit accounts |
87 | 284 | -69 | % | 345 | 544 | -37 | % | ||||||||||||||||
Net gain on sales of loans |
141 | 29 | 386 | % | 642 | 159 | 304 | % | ||||||||||||||||
Net gain on sale of securities |
— | — | n/m | — | 54 | n/m | ||||||||||||||||||
Net gain on acquisition |
208 | — | n/m | 208 | — | n/m | ||||||||||||||||||
Other |
41 | 51 | -20 | % | 182 | 191 | -5 | % | ||||||||||||||||
Noninterest income |
477 | 364 | 31 | % | 1,377 | 948 | 45 | % | ||||||||||||||||
Noninterest expense |
||||||||||||||||||||||||
Salaries and employee benefits |
890 | 1,022 | -13 | % | 4,166 | 4,058 | 3 | % | ||||||||||||||||
Occupancy and equipment |
69 | 162 | -57 | % | 481 | 485 | -1 | % | ||||||||||||||||
Data processing |
161 | 266 | -39 | % | 616 | 687 | -10 | % | ||||||||||||||||
Franchise taxes |
82 | 69 | 19 | % | 346 | 308 | 12 | % | ||||||||||||||||
Professional fees |
175 | 233 | -25 | % | 769 | 558 | 38 | % | ||||||||||||||||
Director fees |
28 | 34 | -18 | % | 108 | 136 | -21 | % | ||||||||||||||||
Postage, printing and supplies |
29 | 32 | -9 | % | 162 | 159 | 2 | % | ||||||||||||||||
Advertising and promotion |
26 | 6 | 333 | % | 52 | 45 | 16 | % | ||||||||||||||||
Telephone |
25 | 24 | 4 | % | 103 | 91 | 13 | % | ||||||||||||||||
Loan expenses |
35 | 6 | 483 | % | 82 | 20 | 310 | % | ||||||||||||||||
Foreclosed assets, net |
— | 7 | n/m | (1 | ) | (3 | ) | n/m | ||||||||||||||||
Depreciation |
133 | 165 | -19 | % | 483 | 683 | -29 | % | ||||||||||||||||
FDIC premiums |
94 | 37 | 154 | % | 541 | 86 | 529 | % | ||||||||||||||||
Amortization of intangibles |
6 | — | n/m | 6 | — | n/m | ||||||||||||||||||
Other |
88 | 110 | -20 | % | 348 | 436 | -20 | % | ||||||||||||||||
Noninterest expense |
1,841 | 2,173 | -15 | % | 8,262 | 7,749 | 7 | % | ||||||||||||||||
Income (loss) before income taxes |
(2,375 | ) | 107 | n/m | (8,314 | ) | 984 | n/m | ||||||||||||||||
Income tax expense |
(180 | ) | 17 | n/m | 1,577 | 261 | n/m | |||||||||||||||||
Net income (loss) |
$ | (2,195 | ) | $ | 90 | n/m | $ | (9,891 | ) | $ | 723 | n/m | ||||||||||||
Net income (loss) available to common stockholders |
$ | (2,297 | ) | $ | 61 | n/m | $ | (10,298 | ) | $ | 694 | n/m | ||||||||||||
Share Data |
||||||||||||||||||||||||
Basic earnings (loss) per common share |
$ | (0.56 | ) | $ | 0.01 | n/m | $ | (2.51 | ) | $ | 0.16 | n/m | ||||||||||||
Diluted earnings (loss) per common share |
$ | (0.56 | ) | $ | 0.01 | n/m | $ | (2.51 | ) | $ | 0.16 | n/m | ||||||||||||
Cash dividends per common share |
$ | — | $ | 0.05 | n/m | $ | — | $ | 0.20 | n/m | ||||||||||||||
Average common shares outstanding — basic |
4,092,903 | 4,078,409 | 4,088,904 | 4,200,504 | ||||||||||||||||||||
Average common shares outstanding — diluted |
4,092,903 | 4,080,082 | 4,088,904 | 4,202,070 | ||||||||||||||||||||
n/m — not meaningful |
||
10
| Consolidated Statements of Financial Condition | ||||||||||||||||||||
| ($ in thousands) | December 31, | September 30, | June 30, | March 31, | December 31, | |||||||||||||||
| (unaudited) | 2009 | 2009 | 2009 | 2009 | 2008 | |||||||||||||||
Assets |
||||||||||||||||||||
Cash and cash equivalents |
$ | 2,973 | $ | 9,400 | $ | 12,510 | $ | 12,329 | $ | 4,177 | ||||||||||
Securities available for sale |
21,241 | 22,824 | 22,700 | 22,529 | 23,550 | |||||||||||||||
Loans held for sale |
1,775 | 943 | 5,995 | 1,642 | 284 | |||||||||||||||
Loans |
||||||||||||||||||||
Mortgage |
30,519 | 30,386 | 28,703 | 27,756 | 28,778 | |||||||||||||||
Commercial, commercial real estate and multi-family |
181,629 | 180,746 | 181,921 | 186,492 | 181,818 | |||||||||||||||
Consumer |
26,047 | 27,425 | 25,079 | 25,482 | 26,445 | |||||||||||||||
Total loans |
238,195 | 238,557 | 235,703 | 239,730 | 237,041 | |||||||||||||||
Less allowance for loan losses |
(7,090 | ) | (4,619 | ) | (3,996 | ) | (3,528 | ) | (3,119 | ) | ||||||||||
Loans, net |
231,105 | 233,938 | 231,707 | 236,202 | 233,922 | |||||||||||||||
Federal Home Loan Bank stock |
1,942 | 1,942 | 2,109 | 2,109 | 2,109 | |||||||||||||||
Loan servicing rights |
88 | 91 | 97 | 105 | 112 | |||||||||||||||
Foreclosed assets, net |
— | — | — | 175 | — | |||||||||||||||
Premises and equipment, net |
7,003 | 4,926 | 5,032 | 5,139 | 5,246 | |||||||||||||||
Other intangible assets |
169 | — | — | — | — | |||||||||||||||
Bank owned life insurance |
4,017 | 3,989 | 3,956 | 3,924 | 3,892 | |||||||||||||||
Deferred tax asset |
— | — | 2,064 | 1,657 | 1,598 | |||||||||||||||
Accrued interest receivable and other assets |
3,429 | 2,373 | 2,232 | 3,481 | 2,891 | |||||||||||||||
Total assets |
$ | 273,742 | $ | 280,426 | $ | 288,402 | $ | 289,292 | $ | 277,781 | ||||||||||
Liabilities and Stockholders’ Equity |
||||||||||||||||||||
Deposits |
||||||||||||||||||||
Noninterest bearing |
$ | 17,098 | 16,458 | $ | 14,960 | $ | 15,108 | $ | 14,557 | |||||||||||
Interest bearing |
193,990 | 199,439 | 199,958 | 205,283 | 193,090 | |||||||||||||||
Total deposits |
211,088 | 215,897 | 214,918 | 220,391 | 207,647 | |||||||||||||||
Short-term Federal Home Loan Bank advances |
2,065 | — | — | — | 5,850 | |||||||||||||||
Long-term Federal Home Loan Bank advances |
29,942 | 30,942 | 33,942 | 28,200 | 23,200 | |||||||||||||||
Advances by borrowers for taxes and insurance |
161 | 111 | 72 | 93 | 167 | |||||||||||||||
Accrued interest payable and other liabilities |
2,104 | 2,919 | 2,265 | 2,531 | 2,687 | |||||||||||||||
Subordinated debentures |
5,155 | 5,155 | 5,155 | 5,155 | 5,155 | |||||||||||||||
Total liabilities |
250,515 | 255,024 | 256,352 | 256,370 | 244,706 | |||||||||||||||
Stockholders’ equity |
23,227 | 25,402 | 32,050 | 32,922 | 33,075 | |||||||||||||||
Total liabilities and stockholders’ equity |
$ | 273,742 | $ | 280,426 | $ | 288,402 | $ | 289,292 | $ | 277,781 | ||||||||||
11
| Consolidated Financial Highlights | At or for the three months ended | At or for the year ended | ||||||||||||||||||||||||||
| ($ in thousands except per share data) | December 31, | September 30, | June 30, | March 31, | December 31, | December 31, | ||||||||||||||||||||||
| (unaudited) | 2009 | 2009 | 2009 | 2009 | 2008 | 2009 | 2008 | |||||||||||||||||||||
Earnings (loss) |
||||||||||||||||||||||||||||
Net interest income |
$ | 2,234 | $ | 2,132 | $ | 2,073 | $ | 2,060 | $ | 2,166 | $ | 8,499 | $ | 8,702 | ||||||||||||||
Provision for loan losses |
$ | 3,245 | $ | 4,776 | $ | 1,357 | $ | 550 | $ | 250 | $ | 9,928 | $ | 917 | ||||||||||||||
Noninterest income |
$ | 477 | $ | 313 | $ | 301 | $ | 286 | $ | 364 | $ | 1,377 | $ | 948 | ||||||||||||||
Noninterest expense |
$ | 1,841 | $ | 2,059 | $ | 2,182 | $ | 2,180 | $ | 2,173 | $ | 8,262 | $ | 7,749 | ||||||||||||||
Net income (loss) |
$ | (2,195 | ) | $ | (6,688 | ) | $ | (762 | ) | $ | (246 | ) | $ | 90 | $ | (9,891 | ) | $ | 723 | |||||||||
Net income (loss) available to common stockholders |
$ | (2,297 | ) | $ | (6,790 | ) | $ | (864 | ) | $ | (347 | ) | $ | 61 | $ | (10,298 | ) | $ | 694 | |||||||||
Basic earnings (loss) per common share |
$ | (0.56 | ) | $ | (1.66 | ) | $ | (0.21 | ) | $ | (0.08 | ) | $ | 0.01 | $ | (2.51 | ) | $ | 0.16 | |||||||||
Diluted earnings (loss) per common share |
$ | (0.56 | ) | $ | (1.66 | ) | $ | (0.21 | ) | $ | (0.08 | ) | $ | 0.01 | $ | (2.51 | ) | $ | 0.16 | |||||||||
Performance Ratios (annualized) |
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Return on average assets |
(3.13 | %) | (9.26 | %) | (1.05 | %) | (0.34 | %) | 0.13 | % | (3.45 | %) | 0.26 | % | ||||||||||||||
Return on average equity |
(35.45 | %) | (89.50 | %) | (9.42 | %) | (2.98 | %) | 1.27 | % | (32.95 | %) | 2.68 | % | ||||||||||||||
Average yield on interest-earning assets |
5.31 | % | 5.20 | % | 5.33 | % | 5.53 | % | 6.16 | % | 5.34 | % | 6.41 | % | ||||||||||||||
Average rate paid on interest-bearing liabilities |
2.20 | % | 2.36 | % | 2.62 | % | 2.82 | % | 3.20 | % | 2.50 | % | 3.38 | % | ||||||||||||||
Average interest rate spread |
3.11 | % | 2.84 | % | 2.71 | % | 2.71 | % | 2.96 | % | 2.84 | % | 3.03 | % | ||||||||||||||
Net interest margin, fully taxable equivalent |
3.37 | % | 3.12 | % | 3.03 | % | 3.05 | % | 3.33 | % | 3.14 | % | 3.35 | % | ||||||||||||||
Efficiency ratio |
67.69 | % | 84.21 | % | 91.91 | % | 92.92 | % | 85.89 | % | 83.60 | % | 80.75 | % | ||||||||||||||
Noninterest expense to average assets |
2.63 | % | 2.85 | % | 3.01 | % | 3.04 | % | 3.13 | % | 2.88 | % | 2.79 | % | ||||||||||||||
Capital |
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Equity to total assets at end of period |
8.48 | % | 9.06 | % | 11.11 | % | 11.38 | % | 11.91 | % | 8.48 | % | 11.91 | % | ||||||||||||||
Tangible equity to tangible assets |
8.43 | % | 9.06 | % | 11.11 | % | 11.38 | % | 11.91 | % | 8.43 | % | 11.91 | % | ||||||||||||||
Book value per common share |
$ | 3.95 | $ | 4.49 | $ | 6.11 | $ | 6.32 | $ | 6.36 | $ | 3.95 | $ | 6.36 | ||||||||||||||
Tangible book value per common share |
$ | 3.91 | $ | 4.49 | $ | 6.11 | $ | 6.32 | $ | 6.36 | $ | 3.91 | $ | 6.36 | ||||||||||||||
Period-end market value per common share |
$ | 1.50 | $ | 2.65 | $ | 2.92 | $ | 2.90 | $ | 2.98 | $ | 1.50 | $ | 2.98 | ||||||||||||||
Dividends declared per common share |
$ | — | $ | — | $ | — | $ | — | $ | 0.05 | $ | — | $ | 0.20 | ||||||||||||||
Period-end common shares outstanding |
4,099,587 | 4,100,337 | 4,100,337 | 4,101,537 | 4,101,537 | 4,099,587 | 4,101,537 | |||||||||||||||||||||
Average basic common shares outstanding |
4,092,903 | 4,090,299 | 4,087,785 | 4,084,520 | 4,078,409 | 4,088,904 | 4,200,504 | |||||||||||||||||||||
Average diluted common shares outstanding |
4,092,903 | 4,090,299 | 4,087,785 | 4,084,520 | 4,080,082 | 4,088,904 | 4,202,070 | |||||||||||||||||||||
Asset Quality |
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Nonperforming loans |
$ | 13,234 | $ | 12,265 | $ | 7,288 | $ | 4,996 | $ | 2,412 | $ | 13,234 | $ | 2,412 | ||||||||||||||
Nonperforming loans to total loans |
5.56 | % | 5.14 | % | 3.09 | % | 2.08 | % | 1.02 | % | 5.56 | % | 1.02 | % | ||||||||||||||
Nonperforming assets to total assets |
4.83 | % | 4.37 | % | 2.53 | % | 1.79 | % | 0.87 | % | 4.83 | % | 0.87 | % | ||||||||||||||
Allowance for loan losses to total loans |
2.98 | % | 1.94 | % | 1.70 | % | 1.47 | % | 1.32 | % | 2.98 | % | 1.32 | % | ||||||||||||||
Allowance for loan losses to nonperforming loans |
53.57 | % | 37.66 | % | 54.83 | % | 70.62 | % | 129.31 | % | 53.57 | % | 129.31 | % | ||||||||||||||
Net charge-offs |
$ | 789 | $ | 4,102 | $ | 889 | $ | 141 | $ | 176 | $ | 5,921 | $ | 482 | ||||||||||||||
Annualized net charge-offs to average loans |
1.32 | % | 6.91 | % | 1.49 | % | 0.24 | % | 0.30 | % | 2.48 | % | 0.21 | % | ||||||||||||||
Average Balances |
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Loans |
$ | 233,146 | 233,041 | $ | 234,235 | $ | 236,011 | $ | 233,245 | $ | 234,108 | $ | 230,658 | |||||||||||||||
Assets |
$ | 280,357 | 289,025 | $ | 290,097 | $ | 287,216 | $ | 277,561 | $ | 286,648 | $ | 277,476 | |||||||||||||||
Stockholders’ equity |
$ | 24,770 | 29,889 | $ | 32,350 | $ | 33,070 | $ | 28,296 | $ | 30,020 | $ | 26,959 | |||||||||||||||
12