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| 8-K - 8-K - MSB FINANCIAL CORP | f8k_10182018-5468.htm |
MSB FINANCIAL CORP. RELEASES THIRD QUARTER EARNINGS
MILLINGTON, NJ, October 18, 2018 - MSB Financial Corp. (NASDAQ: MSBF) (the “Company”), parent company of Millington Bank, reported today the results of its operations for the three and nine months ended September 30, 2018.
The Company reported net income of $1.3 million, or $0.24 per diluted common share, for the three months ended September 30, 2018, compared to net income of $1.2 million, or $0.21 per diluted common share, for the three months ended September 30, 2017. Net income for the nine months ended September 30, 2018 was $3.6 million, or $0.66 per diluted common share, compared to net income of $2.5 million, or 0.44 per diluted common share, for the nine months ended September 30, 2017.
Highlights for the quarter:
• | Return on average assets was 0.92% for the three months ended September 30, 2018 compared to 0.90% for the three months ended September 30, 2017 and return on average equity was 7.56% for the three months ended September 30, 2018 compared to 6.31% for the three months ended September 30, 2017. |
• | Net interest margin increased 7 basis points to 3.44% for the quarter ended September 30, 2018 from 3.37% for the quarter ended September 30, 2017 due to the recognition of $280,000 in commercial prepayment penalties resulting from four large loan payoffs. |
• | The efficiency ratio, which is calculated by dividing non-interest expense by the sum of net interest income and non-interest income, improved to 61.96% for the quarter ended September 30, 2018 from 64.21% for the quarter ended September 30, 2017 driven by an increase in net interest income year over year. |
• | Non-performing assets represented 0.48% of total assets at September 30, 2018 compared with 0.73% at December 31, 2017. The allowance for loan losses as a percentage of total non-performing loans was 198.67% at September 30, 2018 compared to 130.99% at December 31, 2017. |
• | The Company’s balance sheet reflected total asset growth of $27.4 million at September 30, 2018, compared to December 31, 2017, improved asset quality, and capital levels that exceeded regulatory standards for a well-capitalized institution. |
• | The effective tax rate increased to 27.8% for the quarter ended September 30, 2018 compared to (7.9)% for the quarter ended September 30, 2017 primarily due to a permanent tax deduction for the 2017 period due to non-qualified stock options that were exercised during the prior year quarter. |
Selected Financial Ratios | ||||||||||||||||||||
(unaudited; annualized where applicable) | ||||||||||||||||||||
As of or for the quarter ended: | 9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | |||||||||||||||
Return on average assets | 0.92 | % | 0.87 | % | 0.74 | % | 0.20 | % | 0.90 | % | ||||||||||
Return on average equity | 7.56 | % | 7.17 | % | 5.65 | % | 1.48 | % | 6.31 | % | ||||||||||
Net interest margin | 3.44 | % | 3.24 | % | 3.24 | % | 3.30 | % | 3.37 | % | ||||||||||
Net loans / deposit ratio | 113.08 | % | 113.64 | % | 110.85 | % | 105.46 | % | 116.04 | % | ||||||||||
Shareholders' equity / total assets | 11.86 | % | 11.39 | % | 12.37 | % | 12.97 | % | 13.39 | % | ||||||||||
Efficiency ratio | 61.96 | % | 62.49 | % | 66.29 | % | 62.26 | % | 64.21 | % | ||||||||||
Book value per common share | $ | 12.70 | $ | 12.43 | $ | 12.63 | $ | 12.66 | $ | 12.57 | ||||||||||
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Net Interest Income
Total interest income for the three months ended September 30, 2018 increased $1.1 million, or 21.5%, to $6.2 million compared to $5.1 million for the third quarter of 2017. Interest income increased in the quarter ended September 30, 2018 compared to the comparable period in 2017, primarily due to a $52.7 million increase in average loan balances. In addition, $280,000 was recorded in interest income due to commercial prepayment penalties on four large loan payoffs. Total interest expense increased by $527,000, or 59.0%, to $1.4 million, for the three months ended September 30, 2018 compared to the same period in 2017 due to a combination of higher deposit rates and average deposit balances and an increase in the average balance of borrowings outstnading during the 2018 period.
Net interest income for the three months ended September 30, 2018 increased $565,000, or 13.5%, to $4.8 million compared to $4.2 million for the same three-month period in 2017. The change for the three months ended September 30, 2018 was primarily a result of an increase in average earning assets of $55.2 million. The annualized net interest spread was 3.23% and 3.19% for the three months ended September 30, 2018 and 2017, respectively. For the quarter ended September 30, 2018, the Company's annualized net interest margin increased to 3.44% compared to 3.37% for the corresponding three-month period in 2017.
Total interest income for the nine months ended September 30, 2018, increased $3.2 million, or 23.0%, to $17.3 million compared to $14.1 million for the nine months ended September 30, 2017 as average earning assets increased $76.0 million year over year. Total interest expense increased by $1.5 million, or 61.0%, to $3.9 million for the nine months ended September 30, 2018 compared to September 30, 2017 as average interest-bearing liabilities increased $81.9 million year over year and the average cost of such liabilities increased 27 basis points.
Net interest income grew $1.8 million, or 15.2%, to $13.5 million for the nine months ended September 30, 2018 compared to $11.7 million for the nine months ended September 30, 2017. Net interest spread and net interest margin for the nine months ended September 30, 2018, declined 4 and 3 basis points respectively, to 3.12% and 3.31% compared to 3.16% and 3.34% for the nine months ended September 30, 2017. Net interest income and net interest margin decreased as the Company's deposit pricing has become more competitive year over year.
Non-Interest Income and Non-Interest Expense
Non-interest income for the three months ended September 30, 2018 was $190,000, as compared to $205,000 for the same period in 2017. Non-interest expense, which consists of salaries and employee benefits, occupancy expense, professional services and other non-interest expenses totaled $3.1 million for the quarter ended September 30, 2018 as compared to $2.8 million for the same period in 2017. The increase in non-interest expense was primarily related to professional service expense for the costs associated with our Sarbanes-Oxley implementation which requires additional reporting on internal control over the financial reporting of the Company. Previously, the Company was not subject to these requirements as its public float was below the applicable threshold.
Non-interest income for the nine months ended September 30, 2018 was $602,000, as compared to $611,000 for the same period in 2017. Non-interest expense, totaled $9.0 million for the nine months ended September 30, 2018 as compared to $8.4 million for the same period in 2017 with the $593,000 increase primarily attributable to salaries and employee benefits as a result of merit and infrastructure increases. In addition, professional services expense increased as a result of costs associated with our SOX implementation offset by a decrease in director's compensation due to the termination of the director retirement plan last year.
Taxes
For the three months ended September 30, 2018, the Company recorded a $506,000 tax provision compared to a benefit of $86,000 for the three months ended September 30, 2017. The effective tax rate increased to 27.8% for the quarter ended September 30, 2018 compared to (7.9)% for the quarter ended September 30, 2017. As a result of the passage of the Tax Cuts and Jobs Act on December 22, 2017, the federal tax rate for corporations was reduced to 21% during 2018. The increase in tax provision is attributable to an increase in pre-tax income offset by a decrease in the applicable tax rate. The increase in the effective tax rate is due to a permanent tax deduction that was taken in the 2017 period due to non-qualified options that were exercised during the 2017 period.
For the nine months ended September 30, 2018, the Company recorded a $1,320,000 tax provision compared to a provision of $528,000 for the nine months ended September 30, 2017. The effective tax rate increased to 26.9% for the nine months ended September 30, 2018 compared to 17.7% for the nine months ended September 30, 2017. The increase in tax provision is attributable
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to an increase in pre-tax income offset by a decrease in the applicable tax rate. The increase in the effective tax rate is due to a permanent tax deduction that was taken in the 2017 period due to non-qualified options that were exercised during the 2017 period.
Earnings Summary for Period Ended September 30, 2018
The following table presents condensed consolidated statements of income data for the periods indicated.
Condensed Consolidated Statements of Income (unaudited) | ||||||||||||||||||||
(dollars in thousands, except for per share data) | ||||||||||||||||||||
For the quarter ended: | 9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | |||||||||||||||
Net interest income | $ | 4,755 | $ | 4,431 | $ | 4,302 | $ | 4,325 | $ | 4,190 | ||||||||||
Provision for loan losses | 60 | 90 | 90 | 200 | 490 | |||||||||||||||
Net interest income after provision for loan losses | 4,695 | 4,341 | 4,212 | 4,125 | 3,700 | |||||||||||||||
Other income | 190 | 208 | 204 | 211 | 205 | |||||||||||||||
Other expense | 3,064 | 2,899 | 2,987 | 2,824 | 2,822 | |||||||||||||||
Income before income taxes | 1,821 | 1,650 | 1,429 | 1,512 | 1,083 | |||||||||||||||
Income taxes (benefit) | 506 | 407 | 407 | 1,240 | (86 | ) | ||||||||||||||
Net income | $ | 1,315 | $ | 1,243 | $ | 1,022 | $ | 272 | $ | 1,169 | ||||||||||
Earnings per common share: | ||||||||||||||||||||
Basic | $ | 0.25 | $ | 0.23 | $ | 0.19 | $ | 0.05 | $ | 0.21 | ||||||||||
Diluted | $ | 0.24 | $ | 0.23 | $ | 0.19 | $ | 0.05 | $ | 0.21 | ||||||||||
Weighted average common shares outstanding: | ||||||||||||||||||||
Basic | 5,330,029 | 5,331,090 | 5,470,349 | 5,577,314 | 5,563,938 | |||||||||||||||
Diluted | 5,388,577 | 5,375,090 | 5,507,443 | 5,588,598 | 5,574,535 | |||||||||||||||
Statement of Condition Highlights at September 30, 2018
• | Balance sheet growth, with total assets amounting to $590.4 million at September 30, 2018, an increase of $27.4 million, or 4.86%, compared to December 31, 2017. |
• | The Company’s total gross loans receivable were $500.5 million at September 30, 2018, an increase of $21.7 million, or 4.5%, from December 31, 2017. |
• | Securities held to maturity were $43.0 million at September 30, 2018, an increase of $4.5 million, or 11.8%, compared to December 31, 2017. |
• | Deposits decreased $11.3 million totaling $437.6 million at September 30, 2018 compared to $448.9 million at December 31, 2017. |
• | Borrowings totaled $80.1 million at September 30, 2018, an increase of $42.4 million, or 112.5%, compared to $37.7 million at December 31, 2017. |
The following table presents condensed consolidated statements of condition data as of the dates indicated.
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Condensed Consolidated Statements of Condition (unaudited) | ||||||||||||||||||||
(in thousands) | ||||||||||||||||||||
At: | 9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | |||||||||||||||
Cash and due from banks | $ | 1,254 | $ | 1,654 | $ | 1,871 | $ | 2,030 | $ | 1,800 | ||||||||||
Interest-earning demand deposits with banks | 20,817 | 14,660 | 15,484 | 20,279 | 6,971 | |||||||||||||||
Securities held to maturity | 43,009 | 44,770 | 36,375 | 38,482 | 40,752 | |||||||||||||||
Loans receivable, net of allowance | 494,848 | 509,689 | 480,916 | 473,405 | 461,285 | |||||||||||||||
Premises and equipment | 8,323 | 8,461 | 8,580 | 8,698 | 8,804 | |||||||||||||||
Federal home Loan Bank of New York stock, at cost | 4,117 | 4,212 | 3,049 | 2,131 | 3,512 | |||||||||||||||
Bank owned life insurance | 14,489 | 14,392 | 14,294 | 14,197 | 14,097 | |||||||||||||||
Accrued interest receivable | 1,734 | 1,754 | 1,642 | 1,607 | 1,548 | |||||||||||||||
Other assets | 1,803 | 1,657 | 1,816 | 2,211 | 2,988 | |||||||||||||||
Total assets | $ | 590,394 | $ | 601,249 | $ | 564,027 | $ | 563,040 | $ | 541,757 | ||||||||||
Deposits | $ | 437,597 | $ | 448,512 | $ | 433,843 | $ | 448,913 | $ | 397,510 | ||||||||||
Borrowings | 80,075 | 82,175 | 58,075 | 37,675 | 68,375 | |||||||||||||||
Other liabilities | 2,714 | 2,056 | 2,350 | 3,427 | 3,332 | |||||||||||||||
Shareholders' equity | 70,008 | 68,506 | 69,759 | 73,025 | 72,540 | |||||||||||||||
Total liabilities and shareholders' equity | $ | 590,394 | $ | 601,249 | $ | 564,027 | $ | 563,040 | $ | 541,757 | ||||||||||
Loans
At September 30, 2018, the Company’s net loan portfolio totaled $494.8 million, an increase of $21.4 million, or 4.5%, compared to $473.4 million at December 31, 2017. The allowance for loan losses amounted to $5.7 million and $5.4 million at September 30, 2018 and December 31, 2017, respectively.
At September 30, 2018, the loan portfolio primarily consisted of commercial real estate loans (40.8%) and residential mortgages (33.6%). Commercial and industrial loans represented 19.8% of the portfolio while construction loans accounted for 5.6% of the portfolio. Total loans receivable increased $14.0 million to $513.1 million at September 30, 2018 compared to $499.2 million at December 31, 2017. The increase primarily reflects a $28.4 million increase in commercial and industrial loans and a $12.6 million increase in commercial real estate loans. These increases were partially offset by a $12.1 million decrease in residential mortgages as the Company continues to focus on commercial lending as well as a $14.9 million decrease in construction due to the completion of projects.
The following table shows the composition of the Company's loan portfolio as of the dates indicated.
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Loans (unaudited) | ||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||
At quarter ended: | 9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | |||||||||||||||
Residential mortgage: | ||||||||||||||||||||
One-to-four family | $ | 147,127 | $ | 151,372 | $ | 154,576 | $ | 157,876 | $ | 161,679 | ||||||||||
Home equity | 25,494 | 26,174 | 27,051 | 26,803 | 27,409 | |||||||||||||||
Total residential mortgage | 172,621 | 177,546 | 181,627 | 184,679 | 189,088 | |||||||||||||||
Commercial and multi-family real estate | 209,283 | 214,653 | 195,951 | 196,681 | 184,791 | |||||||||||||||
Construction | 28,788 | 48,423 | 49,397 | 43,718 | 36,002 | |||||||||||||||
Commercial and industrial | 101,849 | 94,140 | 82,712 | 73,465 | 73,409 | |||||||||||||||
Total commercial loans | 339,920 | 357,216 | 328,060 | 313,864 | 294,202 | |||||||||||||||
Consumer loans | 580 | 608 | 595 | 618 | 659 | |||||||||||||||
Total loans receivable | 513,121 | 535,370 | 510,282 | 499,161 | 483,949 | |||||||||||||||
Less: | ||||||||||||||||||||
Loans in process | 12,142 | 19,594 | 23,398 | 19,868 | 16,864 | |||||||||||||||
Deferred loan fees | 475 | 491 | 462 | 474 | 525 | |||||||||||||||
Allowance | 5,656 | 5,596 | 5,506 | 5,414 | 5,275 | |||||||||||||||
Total loans receivable, net | $ | 494,848 | $ | 509,689 | $ | 480,916 | $ | 473,405 | $ | 461,285 | ||||||||||
Asset Quality
At September 30, 2018, non-performing loans totaled $2.8 million, or 0.48% of total assets, compared with $4.1 million, or 0.73% of total assets, at December 31, 2017. Of the fifteen loans classified as non-performing, only two are currently in the foreclosure process. All other loans are chronic slow payers that continue to make payments, but are unable to maintain a current status for six consecutive months. Total delinquent loans (including nonperforming delinquent loans) were $6.6 million at September 30, 2018, an increase of $1.2 million from December 31, 2017 due to an increase in loans past due 30-59 days. The allowance for loan losses as a percentage of total loans was 1.13% at September 30, 2018 and at December 31, 2017, respectively, while the allowance for loan losses as a percentage of non-performing loans increased to 198.67% at September 30, 2018 from 130.99% at December 31, 2017. Non-performing loans to total loans decreased to 0.57% at September 30, 2018 from 0.86% at December 31, 2017 primarily due to loans previously on non-accrual moving to an accrual status due to at least six consecutive months of performance.
The following table presents the components of non-performing assets and other asset quality data for the periods indicated.
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(dollars in thousands, unaudited) | ||||||||||||||||||||
As of or for the quarter ended: | 9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | |||||||||||||||
Non-accrual loans | $ | 2,746 | $ | 3,430 | $ | 3,548 | $ | 3,975 | $ | 4,071 | ||||||||||
Loans 90 days or more past due and still accruing | 101 | 699 | 1,266 | 158 | 374 | |||||||||||||||
Total non-performing loans | $ | 2,847 | $ | 4,129 | $ | 4,814 | $ | 4,133 | $ | 4,445 | ||||||||||
Non-performing assets / total assets | 0.48 | % | 0.69 | % | 0.85 | % | 0.73 | % | 0.82 | % | ||||||||||
Non-performing loans / total loans | 0.57 | % | 0.80 | % | 0.99 | % | 0.86 | % | 0.95 | % | ||||||||||
Net charge-offs (recoveries) | $ | — | $ | — | $ | (2 | ) | $ | 61 | $ | 140 | |||||||||
Net charge-offs (recoveries) / average loans (annualized) | — | % | — | % | — | % | 0.05 | % | 0.13 | % | ||||||||||
Allowance for loan loss / total loans | 1.13 | % | 1.09 | % | 1.13 | % | 1.13 | % | 1.13 | % | ||||||||||
Allowance for loan losses / non-performing loans | 198.67 | % | 135.53 | % | 114.37 | % | 130.99 | % | 118.67 | % | ||||||||||
Total assets | $ | 590,394 | $ | 601,249 | $ | 564,027 | $ | 563,040 | $ | 541,757 | ||||||||||
Gross loans, excluding ALLL | $ | 500,504 | $ | 515,285 | $ | 486,422 | $ | 478,819 | $ | 466,560 | ||||||||||
Average loans | $ | 499,082 | $ | 500,959 | $ | 483,255 | $ | 472,388 | $ | 446,383 | ||||||||||
Allowance for loan losses | $ | 5,656 | $ | 5,596 | $ | 5,506 | $ | 5,414 | $ | 5,275 | ||||||||||
Deposits
Total deposits at September 30, 2018 were $437.6 million compared with $448.9 million at December 31, 2017. Overall, deposits decreased $11.3 million. Money market and interest demand balances declined $14.6 million and $5.0 million, respectively. Money market balances declined to $12.8 million compared to $27.4 million while interest demand balances declined to $150.2 million compared to $155.2 million from the prior year end. In addition, savings balances decreased $2.7 million to $102.4 million from $105.1 million from year end. Offsetting the decreases were increases in non-interest demand and certificates of deposit (including IRA) balances of $8.6 million and $2.3 million, respectively. Non-interest demand balances increased to $45.5 million from $36.9 million from year end while certificates of deposit balances increased to $126.6 million compared to $124.3 million from year end.
The following table shows the composition of the Company's deposits as of the dates indicated.
Deposits (unaudited) | ||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||
At quarter ended: | 9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | |||||||||||||||
Demand: | ||||||||||||||||||||
Non-interest bearing | $ | 45,501 | $ | 42,687 | $ | 36,751 | $ | 36,919 | $ | 40,504 | ||||||||||
Interest-bearing | 150,248 | 153,968 | 148,888 | 155,199 | 107,419 | |||||||||||||||
Savings | 102,434 | 109,254 | 109,215 | 105,106 | 108,249 | |||||||||||||||
Money market | 12,822 | 14,381 | 20,251 | 27,350 | 16,517 | |||||||||||||||
Time | 126,592 | 128,222 | 118,738 | 124,339 | 124,821 | |||||||||||||||
Total deposits | $ | 437,597 | $ | 448,512 | $ | 433,843 | $ | 448,913 | $ | 397,510 | ||||||||||
Capital
At September 30, 2018, the Company's total stockholders' equity amounted to $70.0 million, or 11.86% of total assets, compared to $73.0 million at December 31, 2017. The Company’s book value per common share was $12.70 at September 30, 2018, compared to $12.66 at December 31, 2017. The decline in shareholders' equity was primarily due to the repurchase of 249,837 shares of
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common stock for a total of $4.5 million and the payment of a special dividend in the aggregate amount of $2.5 million, partially offset by net income of $3.6 million.
At September 30, 2018, the Bank’s common equity tier 1 ratio was 11.72%, tier 1 leverage ratio was 10.50%, tier 1 capital ratio was 11.72% and the total capital ratio was 12.83%. At December 31, 2017, the Bank’s common equity tier 1 ratio was 11.98%, tier 1 leverage ratio was 10.72%, tier 1 capital ratio was 11.98% and the total capital ratio was 13.10%. At September 30, 2018, Company and the Bank were in compliance with all applicable regulatory capital requirements.
The following table sets forth the Company's consolidated average statements of condition for the periods presented.
Condensed Consolidated Average Statements of Condition (unaudited) | ||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||
For the quarter ended: | 9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | |||||||||||||||
Loans | $ | 499,082 | $ | 500,959 | $ | 483,255 | $ | 472,388 | $ | 446,383 | ||||||||||
Securities held to maturity | 43,871 | 36,494 | 37,661 | 39,899 | 41,423 | |||||||||||||||
Allowance for loan losses | (5,624 | ) | (5,538 | ) | (5,461 | ) | (5,376 | ) | (4,922 | ) | ||||||||||
All other assets | 37,466 | 38,053 | 38,851 | 41,886 | 38,545 | |||||||||||||||
Total assets | $ | 574,795 | $ | 569,968 | $ | 554,306 | $ | 548,797 | $ | 521,429 | ||||||||||
Non-interest bearing deposits | $ | 43,495 | $ | 38,903 | $ | 36,211 | $ | 43,336 | $ | 44,970 | ||||||||||
Interest-bearing deposits | 386,364 | 385,047 | 390,522 | 375,098 | 350,589 | |||||||||||||||
Borrowings | 73,077 | 74,192 | 53,191 | 53,844 | 47,788 | |||||||||||||||
Other liabilities | 2,320 | 2,495 | 1,972 | 3,104 | 3,964 | |||||||||||||||
Stockholders' Equity | 69,539 | 69,331 | 72,410 | 73,415 | 74,118 | |||||||||||||||
Total liabilities and shareholders' equity | $ | 574,795 | $ | 569,968 | $ | 554,306 | $ | 548,797 | $ | 521,429 | ||||||||||
CEO outlook:
“I’m very pleased with our third quarter results. Our staff remains focused on improving asset quality and strengthening our origination process. As a result, the Company experienced a lower loan loss provision and increased interest income from loan prepayment penalties associated with several payoffs,” stated Michael Shriner, President and Chief Executive Officer.
Mr. Shriner further commented, “The Company is committed to originating safe and sound loans at competitive terms and interest rates. The Company will not chase rates and terms, or lower underwriting standards during this period of intense competition for loans.”
Forward Looking Statement Disclaimer
The foregoing release may contain forward-looking statements concerning the financial condition, results of operations and business of the Company. We caution that such statements are subject to a number of uncertainties and actual results could differ materially, and, therefore, readers should not place undue reliance on any forward-looking statements. Factors that may cause actual results to differ from those contemplated include our continued ability to grow the loan portfolio, the impact of the passage of the Tax Cuts and Jobs Act and our continued ability to manage cybersecurity risks.
Contact: | Michael A. Shriner, President & CEO |
(908) 647-4000 | |
mshriner@millingtonbank.com | |
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MSB Financial Corp. and Subsidiaries | ||||||
Consolidated Statements of Financial Condition | ||||||
At September 30, 2018 | At December 31, 2017 | |||||
(Dollars in thousands, except per share amounts) | ||||||
Cash and due from banks | $ | 1,254 | $ | 2,030 | ||
Interest-earning demand deposits with banks | 20,817 | 20,279 | ||||
Cash and Cash Equivalents | 22,071 | 22,309 | ||||
Securities held to maturity (fair value of $41,765 and $38,255, respectively) | 43,009 | 38,482 | ||||
Loans receivable, net of allowance for loan losses of $5,656 and $5,414, respectively | 494,848 | 473,405 | ||||
Premises and equipment | 8,323 | 8,698 | ||||
Federal Home Loan Bank of New York stock, at cost | 4,117 | 2,131 | ||||
Bank owned life insurance | 14,489 | 14,197 | ||||
Accrued interest receivable | 1,734 | 1,607 | ||||
Other assets | 1,803 | 2,211 | ||||
Total Assets | $ | 590,394 | $ | 563,040 | ||
Liabilities and Stockholders' Equity | ||||||
Liabilities | ||||||
Deposits: | ||||||
Non-interest bearing | $ | 45,501 | $ | 36,919 | ||
Interest bearing | 392,096 | 411,994 | ||||
Total Deposits | 437,597 | 448,913 | ||||
Advances from Federal Home Loan Bank of New York | 80,075 | 37,675 | ||||
Advance payments by borrowers for taxes and insurance | 704 | 686 | ||||
Other liabilities | 2,010 | 2,741 | ||||
Total Liabilities | 520,386 | 490,015 | ||||
Stockholders' Equity | ||||||
Preferred stock, par value $0.01; 1,000,000 shares authorized; no shares issued or outstanding | — | — | ||||
Common stock, par value $0.01; 49,000,000 shares authorized; 5,513,165 and 5,768,632 issued and outstanding at September 30, 2018 and December 31, 2017, respectively | 55 | 58 | ||||
Paid-in capital | 46,848 | 51,068 | ||||
Retained earnings | 24,765 | 23,641 | ||||
Unearned common stock held by ESOP (182,218 and 190,390 shares, respectively) | (1,660 | ) | (1,742 | ) | ||
Total Stockholders' Equity | 70,008 | 73,025 | ||||
Total Liabilities and Stockholders' Equity | $ | 590,394 | $ | 563,040 | ||
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MSB Financial Corp. and Subsidiaries | ||||||||||||||||
Consolidated Statements of Income | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
(in thousands except per share amounts) | ||||||||||||||||
Interest Income | ||||||||||||||||
Loans receivable, including fees | $ | 5,788 | $ | 4,769 | $ | 16,360 | $ | 13,213 | ||||||||
Securities held to maturity | 304 | 264 | 763 | 762 | ||||||||||||
Other | 83 | 50 | 219 | 128 | ||||||||||||
Total Interest Income | 6,175 | 5,083 | 17,342 | 14,103 | ||||||||||||
Interest Expense | ||||||||||||||||
Deposits | 1,014 | 622 | 2,795 | 1,703 | ||||||||||||
Borrowings | 406 | 271 | 1,059 | 691 | ||||||||||||
Total Interest Expense | 1,420 | 893 | 3,854 | 2,394 | ||||||||||||
Net Interest Income | 4,755 | 4,190 | 13,488 | 11,709 | ||||||||||||
Provision for Loan Losses | 60 | 490 | 240 | 985 | ||||||||||||
Net Interest Income after Provision for Loan Losses | 4,695 | 3,700 | 13,248 | 10,724 | ||||||||||||
Non-Interest Income | ||||||||||||||||
Fees and service charges | 78 | 87 | 252 | 256 | ||||||||||||
Income from bank owned life insurance | 97 | 101 | 292 | 313 | ||||||||||||
Other | 15 | 17 | 58 | 42 | ||||||||||||
Total Non-Interest Income | 190 | 205 | 602 | 611 | ||||||||||||
Non-Interest Expenses | ||||||||||||||||
Salaries and employee benefits | 1,625 | 1,577 | 5,107 | 4,661 | ||||||||||||
Directors compensation | 121 | 188 | 365 | 551 | ||||||||||||
Occupancy and equipment | 390 | 394 | 1,172 | 1,217 | ||||||||||||
Service bureau fees | 107 | 67 | 251 | 164 | ||||||||||||
Advertising | 18 | 4 | 31 | 12 | ||||||||||||
FDIC assessment | 71 | 61 | 194 | 131 | ||||||||||||
Professional services | 528 | 342 | 1,217 | 1,050 | ||||||||||||
Other | 204 | 189 | 613 | 571 | ||||||||||||
Total Non-Interest Expenses | 3,064 | 2,822 | 8,950 | 8,357 | ||||||||||||
Income before Income Taxes | 1,821 | 1,083 | 4,900 | 2,978 | ||||||||||||
Income Tax Expense | 506 | (86 | ) | 1,320 | 528 | |||||||||||
Net Income | $ | 1,315 | $ | 1,169 | $ | 3,580 | $ | 2,450 | ||||||||
Earnings per share: | ||||||||||||||||
Basic | $ | 0.25 | $ | 0.21 | $ | 0.67 | $ | 0.44 | ||||||||
Diluted | $ | 0.24 | $ | 0.21 | $ | 0.66 | $ | 0.44 | ||||||||
9
MSB Financial Corp. and Subsidiaries | |||||||||||
Selected Quarterly Financial and Statistical Data | |||||||||||
Three Months Ended | |||||||||||
(in thousands, except for share and per share data) (annualized where applicable) | 9/30/2018 | 6/30/2018 | 9/30/2017 | ||||||||
(unaudited) | |||||||||||
Statements of Operations Data | |||||||||||
Interest income | $ | 6,175 | $ | 5,738 | $ | 5,083 | |||||
Interest expense | 1,420 | 1,307 | 893 | ||||||||
Net interest income | 4,755 | 4,431 | 4,190 | ||||||||
Provision for loan losses | 60 | 90 | 490 | ||||||||
Net interest income after provision for loan losses | 4,695 | 4,341 | 3,700 | ||||||||
Other income | 190 | 208 | 205 | ||||||||
Other expense | 3,064 | 2,899 | 2,822 | ||||||||
Income before income taxes | 1,821 | 1,650 | 1,083 | ||||||||
Income tax expense (benefit) | 506 | 407 | (86 | ) | |||||||
Net Income | $ | 1,315 | $ | 1,243 | $ | 1,169 | |||||
Earnings (per Common Share) | |||||||||||
Basic | $ | 0.25 | $ | 0.23 | $ | 0.21 | |||||
Diluted | $ | 0.24 | $ | 0.23 | $ | 0.21 | |||||
Statements of Condition Data (Period-End) | |||||||||||
Investment securities held to maturity (fair value of $41,765, $43,749, and $40,794) | $ | 43,009 | $ | 44,770 | $ | 40,752 | |||||
Loans receivable, net of allowance for loan losses | 494,848 | 509,689 | 461,285 | ||||||||
Total assets | 590,394 | 601,249 | 541,757 | ||||||||
Deposits | 437,597 | 448,512 | 397,510 | ||||||||
Borrowings | 80,075 | 82,175 | 68,375 | ||||||||
Stockholders' equity | 70,008 | 68,506 | 72,540 | ||||||||
Common Shares Dividend Data | |||||||||||
Cash dividends | $ | — | $ | 2,456 | $ | — | |||||
Weighted Average Common Shares Outstanding | |||||||||||
Basic | 5,330,029 | 5,331,090 | 5,563,938 | ||||||||
Diluted | 5,388,577 | 5,375,090 | 5,574,535 | ||||||||
Operating Ratios | |||||||||||
Return on average assets | 0.92 | % | 0.87 | % | 0.90 | % | |||||
Return on average equity | 7.56 | % | 7.17 | % | 6.31 | % | |||||
Average equity / average assets | 12.10 | % | 12.16 | % | 14.21 | % | |||||
Book value per common share (period-end) | $ | 12.70 | $ | 12.43 | $ | 12.57 | |||||
10