Home Federal Bancorp, Inc. of Louisiana (the "Company")
(Nasdaq:HFBL), the holding company of Home Federal Bank, reported
net income for the three months ended June 30, 2013 of $636,000, a
decrease of $137,000 compared to net income of $773,000 reported
for the three months ended June 30, 2012. The Company's basic and
diluted earnings per share were $0.30 and $0.29, respectively, for
the quarter ended June 30, 2013, compared to basic and diluted
earnings per share of $0.29 and $0.28, respectively, for the
quarter ended June 30, 2012.
The Company reported net income of $3.1 million for the year
ended June 30, 2013, an increase of $287,000, or 10.1%, compared to
$2.8 million reported for the year ended June 30, 2012. The
Company's basic and diluted earnings per share were $1.34 and
$1.31, respectively, for the year ended June 30, 2013, compared to
basic and diluted earnings per share of $1.02 and $1.01,
respectively, for the year ended June 30, 2012.
The decrease in net income for the three months ended June 30,
2013, resulted primarily from a $205,000, or 9.9%, increase in
non-interest expense, a $123,000, or 45.1%, increase in income tax
expense, a decrease of $50,000, or 5.9%, in non-interest income,
and an $8,000, or 0.3%, decrease in net interest income, partially
offset by a $249,000, or 68.0%, decrease in the provision for loan
losses. The decrease in net interest income for the three months
ended June 30, 2013, was primarily due to a decrease of $107,000,
or 3.2%, in total interest income, partially offset by a decrease
of $99,000, or 13.8%, in aggregate interest expense on borrowings
and deposits primarily due to an overall decrease in rates paid on
interest-bearing liabilities. The Company's average interest rate
spread was 3.76% for the three months ended June 30, 2013, the same
as the prior year three month period. The Company's net interest
margin was 4.00% for the three months ended June 30, 2013, compared
to 4.08% for the quarter ended June 30, 2012. The decrease in net
interest margin on a comparative quarterly basis was primarily the
result of a higher average volume of interest earnings assets and a
decrease of 25 basis points in average yield on interest-earning
assets for the quarter ended June 30, 2013 compared to the prior
year quarterly period.
The increase in net income for the year ended June 30, 2013,
resulted primarily from a $903,000, or 9.3%, increase in net
interest income, a $100,000, or 3.0%, increase in non-interest
income, and a $298,000 or 34.8%, decrease in the provision for loan
losses, partially offset by an increase of $513,000, or 6.3%, in
non-interest expense and a $501,000, or 44.5%, increase in income
tax expense. The increase in net interest income for the twelve
month period was primarily due to a $432,000 increase in total
interest income as a result of an increase in the volume of
interest-earning assets combined with a $471,000 decrease in
interest expense on borrowings and deposits due to an overall
decline in the average cost of funds. The Company's average
interest rate spread was 3.80% for the year ended June 30, 2013,
compared to 3.62% for the year ended June 30, 2012. The Company's
net interest margin was 4.06% for the year ended June 30, 2013,
compared to 4.00% for the year ended June 30, 2012. The increase in
net interest margin and average interest rate spread is
attributable primarily to the implementation of management's
strategy to enhance our core earnings by increasing commercial loan
volume and related income in conjunction with decreasing costs
associated with deposits and advances from the Federal Home Loan
Bank.
The following tables set forth the Company's average balances
and average yields earned and rates paid on its interest-earning
assets and interest-bearing liabilities for the periods
indicated.
|
For the Three
Months Ended June 30, |
|
2013 |
2012 |
|
Average
Balance |
Average
Yield/Rate |
Average
Balance |
Average
Yield/Rate |
|
(Dollars in thousands) |
Interest-earning assets: |
|
|
|
|
Loans receivable |
$ 210,899 |
5.59% |
$176,534 |
6.32% |
Investment securities |
50,727 |
2.32 |
69,248 |
3.25 |
Interest-earning deposits |
1,247 |
0.64 |
12,598 |
0.06 |
Total interest-earning
assets |
$ 262,873 |
4.94% |
$ 258,380 |
5.19% |
|
|
|
|
|
Interest-bearing liabilities: |
|
|
|
|
Savings accounts |
9,475 |
0.30 |
$ 6,842 |
0.64% |
NOW accounts |
24,092 |
1.07 |
16,641 |
0.72 |
Money market accounts |
41,067 |
0.36 |
47,199 |
0.40 |
Certificates of deposit |
111,060 |
1.59 |
106,561 |
1.93 |
Total interest-bearing
deposits |
185,694 |
1.19 |
177,243 |
1.36 |
FHLB advances |
23,800 |
1.14 |
24,080 |
1.91 |
Total
interest-bearing liabilities |
$ 209,494 |
1.18% |
$ 201,323 |
1.43% |
|
|
|
For the Year
Ended June 30, |
|
2013 |
2012 |
|
Average
Balance |
Average
Yield/Rate |
Average
Balance |
Average
Yield/Rate |
|
(Dollars in thousands) |
Interest-earning assets: |
|
|
|
|
Loans receivable |
$ 197,812 |
5.82% |
$ 156,759 |
6.50% |
Investment securities |
58,132 |
2.80 |
76,310 |
3.31 |
Interest-earning deposits |
4,750 |
0.24 |
8,674 |
0.14 |
Total interest-earning
assets |
$260,694 |
5.05% |
$241,743 |
5.26% |
|
|
|
|
|
Interest-bearing liabilities: |
|
|
|
|
Savings accounts |
$ 7,724 |
0.27% |
$ 6,600 |
0.59% |
NOW accounts |
20,812 |
0.88 |
16,854 |
0.71 |
Money market accounts |
40,539 |
0.42 |
39,044 |
0.55 |
Certificates of deposit |
109,033 |
1.72 |
97,838 |
2.13 |
Total interest-bearing
deposits |
178,108 |
1.26 |
160,336 |
1.54 |
FHLB advances |
27,529 |
1.22 |
25,492 |
2.31 |
Total
interest-bearing liabilities |
$ 205,637 |
1.25% |
$ 185,828 |
1.64% |
The $50,000 decrease in non-interest income for the quarter
ended June 30, 2013, compared to the prior year quarterly period
was due to decreases of $107,000 in gain on sale of securities, and
$33,000 in other non-interest income, partially offset by an
increase of $92,000 in gain on sale of loans held for sale. The
$100,000 increase in non-interest income for the year ended June
30, 2013, compared to the prior year period was primarily due to an
increase of $320,000 in gain on loans held for sale, partially
offset by decreases of $146,000 in gain on sale of securities,
$55,000 in other non-interest income and $19,000 in income from
bank owned life insurance. The Company sells most of its fixed rate
mortgage loan originations other than those loans selected for
portfolio.
The $205,000 increase in non-interest expense for the three
months ended June 30, 2013 compared to 2012 was primarily due to
increases of $123,000 in compensation and benefits expense, $63,000
in occupancy and equipment expense, $14,000 in other non-interest
expenses, $10,000 in loan and collection expense, and $6,000 in
legal expense. These increases were partially offset by decreases
of $15,000 in advertising expense and $3,000 in franchise and bank
shares tax expense. The $513,000 increase in non-interest expense
for the year ended June 30, 2013 compared to 2012 was primarily due
to increases in compensation and benefits expense of $433,000, due
in part to increasing loan volume and related commissions to
commercial and residential loan officers, as well as increases of
$88,000 in legal expenses, $73,000 in data processing costs and
$45,000 in occupancy and equipment expense. These increases were
partially offset by decreases of $60,000 in audit and examination
fees, $41,000 in advertising expense, $21,000 in loan and
collection expense, $10,000 in franchise and bank shares tax
expense and $9,000 other non-interest expenses. Additions to the
provision for loan losses during the quarter and year ended June
30, 2013, reflect the increase in loan loss allowances deemed
necessary by management for risks associated with the increasing
volume of non-residential and commercial loans.
At June 30, 2013, the Company reported total assets of $277.2
million, a decrease of $19.0 million, or 6.4%, compared to total
assets of $296.2 million at June 30, 2012. The decrease in assets
was comprised primarily of decreases in investment securities of
$20.4 million, or 29.2%, from $69.8 million at June 30, 2012, to
$49.4 million at June 30, 2013, loans held-for-sale of $7.7
million, or 69.0%, from $11.2 million at June 30, 2012 to $3.5
million at June 30, 2013, and a decrease in cash and cash
equivalents of $31.2 million, or 89.4%, from $34.9 million at June
30, 2012 to $3.7 million at June 30, 2013, partially offset by an
increase in net loans receivable of $37.8 million, or 22.5% from
$168.3 million at June 30, 2012 to $206.1 million at June 30, 2013.
The decrease in cash and cash equivalents was due to a
non-recurring deposit in the quarter ended June 30, 2012 which had
a balance of approximately $31.7 million at June 30, 2012. The
deposit was short-term in nature and was fully withdrawn during the
quarter ended September 30, 2012. The decrease in investment
securities was due to sales and principal repayments during the
year ended June 30, 2013. The decrease in loans held-for-sale
primarily reflects a decrease at June 30, 2013 in receivables from
financial institutions purchasing the Company's loans held-for-sale
and a decrease in loan origination volume during the last quarter
of fiscal 2013.
The following table shows total loans originated and sold during
the periods indicated.
|
Year
Ended June 30, |
|
|
2013 |
2012 |
% Change |
|
(In thousands) |
|
Loan originations: |
|
|
|
One — to four-family
residential |
$ 169,806 |
$ 163,326 |
3.97 % |
Commercial — real estate secured
(owner occupied and non-owner occupied) |
17,018 |
13,195 |
28.97% |
Multi-family residential |
7,325 |
4,751 |
54.18% |
Commercial business |
9,877 |
14,145 |
(30.17)% |
Land |
6,591 |
7,596 |
(13.23)% |
Construction |
26,410 |
39,608 |
(33.32)% |
Home equity loans and lines of credit and
other consumer |
3,827 |
9,309 |
(58.89)% |
Total loan
originations |
$ 240,854 |
$ 251,930 |
(4.40)% |
Loans sold |
$(110,428) |
$(119,969) |
(7.95)% |
Included in the $26.4 million of construction loan originations
for the year ended June 30, 2013 are approximately $23.1 million of
one- to four-family residential construction loans and $3.3 million
of commercial and multi-family construction loans, secured by
properties which are primarily located in the Company's market
area.
Total liabilities decreased $11.1 million, or 4.5%, from $246.3
million at June 30, 2012 to $235.2 million at June 30, 2013,
primarily due to a decrease in total deposits of $9.5 million, or
4.3%, to $211.9 million at June 30, 2013, compared to $221.4
million at June 30, 2012. The decrease in deposits was primarily
due to the withdrawal during the quarter ended September 30, 2012,
of the non-recurring deposit discussed above which had a balance of
approximately $31.7 million at June 30, 2012. During the latter
part of fiscal 2012, the Company began utilizing brokered
certificates of deposit as a component of its strategy for lowering
Home Federal Bank's overall cost of funds. The Company has accepted
$2.3 million in new brokered certificates of deposit in fiscal
2013. The brokered certificates of deposit which have maturity
dates greater than twelve months are callable by Home Federal Bank
after twelve months pursuant to early redemption provisions. At
June 30, 2013 and June 30, 2012, the Company had $12.7 million and
$10.4 million, respectively, in brokered deposits. Advances from
the Federal Home Loan Bank of Dallas decreased $1.8 million, or
7.7%, to $21.7 million at June 30, 2013, from $23.5 million at June
30, 2012.
At June 30, 2013, the Company had $649,000 of non-performing
assets compared to $14,000 of non-performing assets at June 30,
2012, consisting of four single-family residential loans and one
non-performing line of credit at June 30, 2013, compared to one
non-performing single family residential loan at June 30, 2012. The
Company had three commercial loans and one residential mortgage
loan classified substandard at June 30, 2013 in the aggregate
amount of $5.3 million, compared to two residential mortgage loans
and one line of credit classified as substandard at June 30, 2012
in the aggregate amount of $451,000. The loans are performing in
accordance with their terms at June 30, 2013. The Company had one
line of credit classified as doubtful at June 30, 2013 in the
amount of $27,000 compared to none at June 30, 2012.
Shareholders' equity decreased $7.9 million, or 15.8%, to $42.0
million at June 30, 2013, from $49.9 million at June 30,
2012. The primary reasons for the decrease in shareholders'
equity from June 30, 2012, were the acquisition of treasury stock
of $10.5 million, dividends paid of $633,000 and a decrease in the
Company's accumulated other comprehensive income of $1.3 million.
These decreases in shareholders' equity were partially offset by
net income of $3.1 million for the year ended June 30, 2013,
proceeds from the issuance of common stock from the exercise of
stock options of $767,000 and the vesting of restricted stock
awards, stock options and release of employee stock ownership plan
shares totaling $617,000.
The Company repurchased 584,842 shares of its common stock
during the year ended June 30, 2013 at an average price per share
of $17.57. Of the repurchased shares, 397,342 shares were acquired
under the stock repurchase programs. As of June 30, 2013, there
were a total of 123,607 shares remaining for repurchase under the
programs.
Home Federal Bancorp, Inc. of Louisiana is the holding company
for Home Federal Bank which conducts business from its four
full-service banking offices and one agency in northwest
Louisiana.
Statements contained in this news release which are not
historical facts may be forward-looking statements as that term is
defined in the Private Securities Litigation Reform Act of
1995. Forward-looking statements can be identified by the fact
that they do not relate strictly to historical or current
facts. They often include words like "believe," "expect,"
"anticipate," "estimate" and "intend" or future or conditional
verbs such as "will," "would," "should," "could" or "may." We
undertake no obligation to update any forward-looking
statements.
|
Home Federal Bancorp,
Inc. of Louisiana |
CONDENSED CONSOLIDATED
STATEMENTS OF FINANCIAL CONDITION |
(In thousands) |
|
June
30, |
|
2013 |
2012 |
ASSETS |
(Unaudited) |
|
|
|
Cash and cash equivalents |
$ 3,685 |
$ 34,863 |
Securities available for sale at fair
value |
47,961 |
68,426 |
Securities held to maturity (fair value June
30, 2013: $1,465; June 30, 2012: $1,381) |
1,465 |
1,381 |
Loans held-for-sale |
3,464 |
11,157 |
Loans receivable, net of allowance for loan
losses (June 30, 2013: $2,240; June 30, 2012: $1,698) |
206,079 |
168,263 |
Other assets |
14,501 |
12,093 |
|
|
|
Total assets |
$ 277,155 |
$ 296,183 |
|
|
|
LIABILITIES AND SHAREHOLDERS'
EQUITY |
|
|
|
|
|
Deposits |
$ 211,922 |
$ 221,436 |
Advances from the Federal Home Loan Bank of
Dallas |
21,662 |
23,469 |
Other liabilities |
1,589 |
1,390 |
|
|
|
Total liabilities |
235,173 |
246,295 |
|
|
|
Shareholders' equity |
41,982 |
49,888 |
|
|
|
Total liabilities and shareholders'
equity |
$ 277,155 |
$ 296,183 |
|
|
Home Federal Bancorp,
Inc. of Louisiana |
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME |
(In thousands, except per share
data) |
|
|
|
|
|
|
Three Months
Ended |
Year
Ended |
|
June
30, |
June
30, |
|
2013 |
2012 |
2013 |
2012 |
|
(Unaudited) |
(Unaudited) |
Interest income |
|
|
|
|
Loans, including fees |
$ 2,949 |
$ 2,788 |
$ 11,513 |
$ 10,181 |
Investment securities |
2 |
7 |
21 |
95 |
Mortgage-backed
securities |
293 |
556 |
1,608 |
2,433 |
Other interest-earning
assets |
2 |
2 |
12 |
13 |
Total interest
income |
3,246 |
3,353 |
13,154 |
12,722 |
Interest expense |
|
|
|
|
Deposits |
551 |
603 |
2,244 |
2,461 |
Federal Home Loan Bank
borrowings |
63 |
115 |
326 |
589 |
Other bank borrowings |
5 |
-- |
9 |
-- |
Total interest
expense |
619 |
718 |
2,579 |
3,050 |
Net interest income |
2,627 |
2,635 |
10,575 |
9,672 |
Provision for loan losses |
117 |
366 |
558 |
856 |
Net interest income after provision for loan losses |
2,510 |
2,269 |
10,017 |
8,816 |
|
|
|
|
|
Non-interest income |
|
|
|
|
Gain on sale of loans |
681 |
589 |
2,673 |
2,353 |
Gain on sale of
securities |
1 |
108 |
216 |
362 |
Income on Bank Owned Life
Insurance |
45 |
47 |
186 |
205 |
Other income |
76 |
109 |
349 |
404 |
|
|
|
|
|
Total non-interest income |
803 |
853 |
3,424 |
3,324 |
|
|
|
|
|
Non-interest expense |
|
|
|
|
Compensation and
benefits |
1,451 |
1,328 |
5,519 |
5,086 |
Occupancy and equipment |
257 |
194 |
798 |
753 |
Data processing |
105 |
100 |
418 |
345 |
Audit and examination
fees |
48 |
49 |
206 |
266 |
Franchise and bank shares
tax |
84 |
87 |
308 |
318 |
Advertising |
60 |
75 |
241 |
282 |
Legal fees |
77 |
71 |
475 |
387 |
Loan and collection |
38 |
28 |
124 |
145 |
Deposit insurance
premium |
33 |
30 |
128 |
113 |
Other expenses |
128 |
114 |
466 |
475 |
|
|
|
|
|
|
Total
non-interest expense |
2,281 |
2,076 |
8,683 |
8,170 |
|
|
|
|
|
|
|
Income before income taxes |
1,032 |
1,046 |
4,758 |
3,970 |
|
Provision for income tax expense |
396 |
273 |
1,628 |
1,127 |
|
|
|
|
|
|
|
NET INCOME |
$ 636 |
$ 773 |
$ 3,130 |
$ 2,843 |
|
|
|
|
|
|
|
EARNINGS PER SHARE |
|
|
|
|
|
Basic |
$ 0.30 |
$ 0.29 |
$ 1.34 |
$ 1.02 |
|
Diluted |
$ 0.29 |
$ 0.28 |
$ 1.31 |
$ 1.01 |
|
|
|
|
Three Months
Ended |
Year Ended |
|
June
30, |
June
30, |
|
2013 |
2012 |
2013 |
2012 |
|
(Unaudited) |
(Unaudited) |
Selected Operating
Ratios(1): |
|
|
|
|
Average interest rate spread |
3.76% |
3.76% |
3.80% |
3.62% |
Net interest margin |
4.00% |
4.08% |
4.06% |
4.00% |
Return on average assets |
0.91% |
1.13% |
1.13% |
1.11% |
Return on average equity |
5.80% |
6.19% |
6.86% |
5.62% |
|
|
|
|
|
Asset Quality
Ratios(2): |
|
|
|
|
Non-performing assets as a percent of
total assets |
0.23% |
*% |
0.23% |
*% |
Allowance for loan losses as a percent of
non-performing loans |
345.15% |
12,128.57% |
345.15% |
12,128.57% |
Allowance for loan losses as a percent of
total loans receivable |
1.07% |
1.00% |
1.07% |
1.00% |
|
|
|
|
|
Per Share Data: |
|
|
|
|
Shares outstanding at period end |
2,351,950 |
2,877,032 |
2,351,950 |
2,877,032 |
Weighted average shares outstanding: |
|
|
|
|
Basic |
2,120,677 |
2,683,551 |
2,330,303 |
2,799,945 |
Diluted |
2,181,365 |
2,722,588 |
2,394,517 |
2,818,075 |
Tangible book value at period end |
$17.85 |
$17.34 |
$17.85 |
$17.34 |
_______________ |
|
|
|
|
(1) Ratios for the three month periods are
annualized. |
|
|
|
|
(2) Asset quality ratios are end of
period ratios. |
|
|
|
|
* Not meaningful |
|
|
|
|
CONTACT: James R. Barlow
President and Chief Operating Officer
(318) 222-1145
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