NEW BERLIN, Wis., Aug. 14 /PRNewswire-FirstCall/ -- Merchants &
Manufacturers Bancorporation, Inc. ("Merchants") (OTC:MMBI)
(BULLETIN BOARD: MMBI) announced net income of $920,000, or $0.25
per diluted share, for the three months ended June 30, 2007
compared to $1.4 million, or $0.37 per diluted share, for the three
months ended June 30, 2006, representing a 32.7% decrease in net
income and a 32.4% decrease per diluted share. For the six months
ended June 30, 2007, the Corporation had net income of $2.2
million, or $0.60 per diluted share, compared to $2.4 million, or
$0.65 per diluted share, for the six months ending June 30, 2006,
representing an 8.2% decrease in net income and a 7.7% decrease in
diluted earnings per share. Net income from continuing operations
was $611,000, or $0.17 per diluted share, for the three months
ended June 30, 2007 compared to $1.2 million, or $0.31 per diluted
share, for the three months ended June 30, 2006, representing a
47.3% decrease in net income and a 45.2% decrease per diluted
share. For the six months ended June 30, 2007, the Corporation had
net income from continuing operations of $1.7 million, or $0.46 per
diluted share, compared to $2.0 million, or $0.55 per diluted
share, for the six months ending June 30, 2006, representing a
17.4% decrease in net income and a 16.4% decrease in diluted
earnings per share. Net income from discontinued operations was
$309,000, or $0.08 per diluted share, for the three months ended
June 30, 2007 compared to $207,000, or $0.06 per diluted share, for
the three months ended June 30, 2006, representing a 49.3% increase
in net income and a 33.3% increase per diluted share. For the six
months ended June 30, 2007, the Corporation had net income from
discontinued operations of $508,000, or $0.14 per diluted share,
compared to $350,000, or $0.10 per diluted share, for the six
months ending June 30, 2006, representing a 45.1% increase in net
income and a 40.0% increase in diluted earnings per share. The
decrease in earnings for the three and six months ended June 30,
2007 compared to the same periods in 2006 is attributable to a
decrease in net interest income partially offset by an increase in
noninterest income and a decrease in noninterest expense. Earnings
were also negatively affected by a decline in the net interest
margin to 3.22% for the six months ended June 30, 2007 compared to
3.38% for the same period in the prior year. The decrease in our
net interest margin is due to an increased cost of funds as a
result of growth in relatively high cost deposits as well as
additional competitive pressure on loan pricing which has made it
difficult to increase loan volume. Total assets decreased $38.8
million, or 2.6%, to $1.47 billion at June 30, 2007 compared to
$1.51 billion at December 31, 2006. The decline in assets can be
primarily attributed to a decrease in loans and investment
securities partially offset by an increase in cash and cash
equivalents due to the sale of Fortress Bank Minnesota. On June 7,
2007, the Corporation closed on the sale of substantially all of
the assets of Fortress Bank Minnesota to Eastwood Bank. Eastwood
Bank purchased $23.0 million in loans, $41.3 million in deposits
and $1.0 million of fixed assets. Total net income after tax from
Fortress Bank Minnesota included in discontinued operations, was
$164,000, or $0.04 per diluted share, for the three months ended
June 30, 2007 compared to $81,000, or $0.02 per diluted share, for
the three months ended June 30, 2006. For the six months ended June
30, 2007, Fortress Bank Minnesota had net income of $239,000, or
$0.07 per diluted share, compared to $132,000, or $0.04 per diluted
share, for the six months ending June 30, 2006. In addition, we
were engaged in negotiations to sell Fortress Bank of Cresco during
the second quarter, and subsequently entered into a definitive
agreement to sell Fortress Bank of Cresco to Security Agency,
Incorporated on July 13, 2007. As a result, the assets and
liabilities of Fortress Bank of Cresco have been classified as held
for sale in the accompanying balance sheets with the related
operations reported in discontinued operations. Thus, total assets
and liabilities held for sale were $81.1 million and 71.5 million,
respectively, as of June 30, 2007. Total net income after tax from
Fortress Bank of Cresco included in discontinued operations, was
$145,000 or $0.04 per diluted share, for the three months ended
June 30, 2007 compared to $126,000, or $0.04 per diluted share, for
the three months ended June 30, 2006. For the six months ended June
30, 2007, Fortress Bank of Cresco had net income of $269,000, or
$0.07 per diluted share, compared to $218,000, or $0.06 per diluted
share, for the six months ending June 30, 2006. Merchants &
Manufacturers Bancorporation, Inc. is a financial holding company
headquartered in New Berlin, Wisconsin, a suburb of Milwaukee.
Through our Community Financial Group network, we operate six banks
in Wisconsin (Community Bank Financial, Fortress Bank, Grafton
State Bank, Lincoln State Bank, The Reedsburg Bank and Wisconsin
State Bank) and one bank in Iowa (Fortress Bank of Cresco). Our
banks are separately chartered with each having its own name,
management team, board of directors and community commitment.
Together, our banks operate 50 offices in the communities they
serve with more than 100,000 clients and total assets of $1.5
billion. In addition to traditional banking services, our Community
Financial Group network also provides our clients with a full range
of financial services including investment and insurance products,
residential mortgage services, private banking capabilities and tax
consultation and tax preparation services. Merchants' shares trade
on the Over-the-Counter Bulletin Board under the symbol "MMBI".
Certain statements contained in this press release constitute or
may constitute forward-looking statements about Merchants which we
believe are covered by the safe harbor provisions for
forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995. This release contains
forward-looking statements concerning the Corporation's prospects
that are based on the current expectations and beliefs of
management. When used in written documents, the words anticipate,
believe, estimate, expect, objective and similar expressions are
intended to identify forward-looking statements. The statements
contained herein and such future statements involve or may involve
certain assumptions, risks and uncertainties, many of which are
beyond the Corporation's control, that could cause the
Corporation's actual results and performance to differ materially
from what is expected. In addition to the assumptions and other
factors referenced specifically in connection with such statements,
the following factors could impact the business and financial
prospects of the Corporation: general economic conditions;
legislative and regulatory initiatives; monetary and fiscal
policies of the federal government; deposit flows;
disintermediation; the cost of funds; general market rates of
interest; interest rates or investment returns on competing
investments; demand for loan products; demand for financial
services; changes in accounting policies or guidelines; changes in
the quality or composition of the Corporation's loan and investment
portfolio; and the satisfaction of the closing conditions for the
sale of Fortress Bank of Cresco, including regulatory approval, and
risk that the transaction does not close. Such uncertainties and
other risk factors are discussed further in the Corporation's
filings with the Securities and Exchange Commission. The
Corporation undertakes no obligation to make any revisions to
forward-looking statements contained in this release or to update
them to reflect events or circumstances occurring after the date of
this release. June 30, December 31, June 30, 2007 2006 2006
(Dollars in Thousands, Except Share and Per Share Amounts) ASSETS
Cash and due from banks $38,280 $33,851 $42,858 Interest bearing
deposits in banks 1,784 907 4,018 Federal funds sold 11,848 6,023
259 Cash and cash equivalents 51,912 40,781 47,135
Available-for-sale securities 127,767 144,581 156,672 Loans, less
allowance for loan losses of $11,515 at June 30, 2007, $12,311 at
December 31, 2006 and $11,382 at June 30, 2006 1,106,795 1,137,954
1,135,632 Assets held for sale 81,130 81,703 81,491 Accrued
interest receivable 6,550 6,881 6,566 FHLB stock 11,446 11,437
14,299 Premises and equipment 28,948 30,600 29,088 Goodwill 27,320
28,798 28,723 Intangible assets 1,960 2,473 2,680 Other assets
23,345 20,732 20,016 Total assets $1,467,173 $1,505,940 $1,522,302
LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities Deposits:
Non-interest bearing $113,756 $133,623 $129,546 Interest bearing
955,829 972,853 955,541 Total deposits 1,069,585 1,106,476
1,085,087 Short-term borrowings 53,895 55,388 95,155 Long-term
borrowings 109,152 109,906 115,822 Junior subordinated debt owed to
unconsolidated trusts 53,611 53,611 46,394 Liabilities held for
sale 71,480 72,163 72,420 Accrued interest payable 3,747 4,213
3,878 Other liabilities 12,172 9,886 11,112 Total liabilities
1,373,642 1,411,643 1,429,868 Stockholders' equity Preferred stock,
$1.00 par value; 250,000 shares authorized, shares issued and
shares outstanding - none - - - Common stock $1.00 par value;
25,000,000 shares authorized; shares issued: 3,770,251 at June 30,
2007, December 31, 2006 and June 30, 2006; shares outstanding:
3,662,416 at June 30, 2007, 3,677,180 at December 31, 2006 and
3,687,180 at June 30, 2006 3,770 3,770 3,770 Additional paid-in
capital 53,666 53,684 53,673 Retained earnings 41,147 40,259 39,991
Accumulated other comprehensive loss (2,049) (881) (2,781) Treasury
stock, at cost (107,835 shares at June 30, 2007, 93,071 shares at
December 31, 2006 and 83,071 shares at June 30, 2006) (3,003)
(2,535) (2,219) Total stockholders' equity 93,531 94,297 92,434
Total liabilities and stockholders' equity $1,467,173 $1,505,940
$1,522,302 Three Months Ended Six Months Ended June 30, June 30,
2007 2006 2007 2006 (Dollars In Thousands, Except Per Share
Amounts) Interest income: Interest and fees on loans $19,928
$19,204 $39,921 $36,986 Interest and dividends on securities:
Taxable 209 249 412 535 Tax-exempt 521 585 1,032 1,170 Interest on
mortgage-backed securities 779 855 1,579 1,654 Interest on interest
bearing deposits in banks and federal funds sold 265 43 495 98
Total interest income 21,702 20,936 43,439 40,443 Interest expense:
Interest on deposits 8,898 7,049 17,379 13,411 Interest on
short-term borrowings 534 1,302 1,331 2,338 Interest on long-term
borrowings 1,298 1,183 2,550 2,190 Interest on junior subordinated
debt owed to unconsolidated trusts 1,058 903 2,104 1,766 Total
interest expense 11,788 10,437 23,364 19,705 Net interest income
9,914 10,499 20,075 20,738 Provision for loan losses 450 390 900
780 Net interest income after provision for loan losses 9,464
10,109 19,175 19,958 Non-interest income: Service charges on
deposit accounts 967 960 1,864 1,892 Service charges on loans 588
804 1,466 1,519 Securities gains, net - - - - Gain on sale of
loans, net 9 39 33 54 Gain on sale of fixed assets, net 162 - 161
175 Tax fees, brokerage and insurance commissions 535 461 1,412
1,265 Other 681 758 1,280 1,703 Total noninterest income 2,942
3,022 6,216 6,608 Noninterest expenses: Salaries and employee
benefits 6,633 6,821 13,194 14,081 Premises and equipment 1,781
1,564 3,691 3,300 Data processing fees 848 770 1,653 1,582
Marketing and business development 449 416 867 865 Other 1,824
1,890 3,493 3,832 Total noninterest expense 11,535 11,461 22,898
23,660 Income from continuing operations before income taxes 871
1,670 2,493 2,906 Income taxes 260 510 803 861 Income from
continuing operations 611 1,160 1,690 2,045 Discontinued operations
Income from discontinued operations before income tax expense 1,695
306 1,993 509 Income tax expense 1,386 99 1,485 159 Income from
discontinued operations 309 207 508 350 Net income $920 $1,367
$2,198 $2,395 Three Months Ended Six Months Ended June 30, June 30,
2007 2006 2007 2006 (Dollars In Thousands, Except Per Share
Amounts) Basic earnings per share from continuing operations $0.17
$0.31 $0.46 $0.55 Basic earnings per share from discontinued
operations $0.08 $0.06 $0.14 $0.10 Basic earnings per share $0.25
$0.37 $0.60 $0.65 Diluted earnings per share from continuing
operations $0.17 $0.31 $0.46 $0.55 Diluted earnings per share from
discontinued operations $0.08 $0.06 $0.14 $0.10 Diluted earnings
per share $0.25 $0.37 $0.60 $0.65 Dividends per share $0.18 $0.18
$0.36 $0.36 DATASOURCE: Merchants & Manufacturers
Bancorporation, Inc. CONTACT: Michael J. Murry, Chairman of the
Board of Directors, +1-414-425-5334, or Frederick R. Klug,
Executive Vice President and Chief Financial Officer,
+1-262-827-5632, both of Merchants & Manufacturers
Bancorporation, Inc.
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