KS Bancorp, Inc. (the �Company�) (OTCBB: KSBI), parent company
of KS Bank, Inc., today reported results for the first quarter
ended March 31, 2009. In addition, the Company announced that its
Board of Directors voted to suspend payment of the Company�s
quarterly cash dividend.
Net income for the quarter ended March 31, 2009 was $100,000, or
$0.08 per diluted share, compared to earnings of $374,000, or $0.29
per diluted share, for the same period in 2008. Comparing the first
quarter of 2008 to the first quarter 2009, the reduction in earning
is primarily reflective of an increase of $430,000 to the allowance
for loan losses during the first quarter of 2009 compared to
$35,000 in 2008.
Total noninterest income increased by $144,000 for the first
quarter 2009 to $602,000 compared to $458,000 for the same period
in 2008. This increase is a result of $104,000 in gains on sales of
investments and an increase in fees from presold mortgages. The
Company�s noninterest expense remained relativity flat at $2.4
million for the quarters ended March 31, 2009 and March 31,
2008.
The Company�s consolidated total assets decreased $1.6 million
to $323.2 million during the three months ended March 31, 2009, as
compared to $324.8 million at December 31, 2008. This decrease in
the Company�s total assets resulted primarily from the decrease of
$1.7 million in net loans to $242.7 million at March 31, 2009
compared to $244.3 at December 31, 2008. Total deposits were $240.8
million at March 31, 2009 compared to $242.4 million at December
31, 2008
Nonperforming assets, which includes nonaccrual loans, and other
real estate owned totaled $8.6 million at March 31, 2009, versus
$8.5 million at December 31, 2008. As it was in the fourth quarter
of 2008, nonperforming loans and charge-offs are primarily related
to our residential construction and development portfolio, which
has been and continues to be negatively affected by the slowing
housing market.
Commenting on the first quarter 2009 results, Harold Keen,
President and CEO, stated, �The current recession and economic
pressures on the housing and real estate market continues to impact
property values and credit quality; as a result, we continue to
adjust our provision for loan losses accordingly. Our staff is
proactively monitoring delinquencies and we continue to work with
customers to effectively resolve problem credits and provide relief
until market conditions improve.�
�While disappointing, the suspension of our quarterly dividend
is a prudent step in preserving capital during this continuing
economic downturn. While no assurances can be given regarding the
resumption of dividend payments, the Board of Directors will
continue to monitor business conditions, the Company�s
profitability and capital levels, as well as, asset quality in
considering whether to resume cash dividend payments. KS Bank
continues to be well-capitalized according to regulatory guidelines
and we continue to be focused on our core business.�
�In addition, we are pleased to announce that this month marks
our 85th year of service to our customers. During this timeframe,
the Bank has grown from a one branch Savings and Loan to full
service community bank with nine branches. We are looking forward
to continuing our service to the communities in which we are
located.�
KS Bancorp, Inc. is a Smithfield, North Carolina-based single
bank holding company. KS Bank, Inc., a state-chartered savings
bank, is KS Bancorp�s sole subsidiary. The Bank is a full service
community bank serving the citizens of eastern North Carolina since
1924 and offers a variety of financial products and services
including a securities brokerage service through an affiliation
with a broker/dealer. There are nine full service branches located
in Kenly, Selma, Clayton, Garner, Goldsboro, Wilson, Wendell,
Smithfield, and Four Oaks, North Carolina. For more information,
visit www.ksbankinc.com.
This release contains certain forward-looking statements with
respect to the financial condition, results of operations and
business of the Company. These forward-looking statements involve
risks and uncertainties and are based on the beliefs and
assumptions of management of the Company and on the information
available to management at the time that these disclosures were
prepared. These statements can be identified by the use of words
like �expect,� �anticipate,� �estimate� and �believe,� variations
of these words and other similar expressions. Readers should not
place undue reliance on forward-looking statements as a number of
important factors could cause actual results to differ materially
from those in the forward-looking statements. The Company
undertakes no obligation to update any forward-looking
statements.
KS Bancorp, Inc. and
Subsidiary
Consolidated Statements of Financial Condition � � � � March
31, 2009
(unaudited) December 31,
2008* �
(Dollars in thousands)
ASSETS � Cash and due from banks:
Interest-earning
$ 3,122 $ 3,116 Noninterest-earning 1,839 1,550
Time Deposit
100 100 Investment securities available for sale, at fair value
53,672 54,588 Federal Home Loan Bank stock, at cost 2,975 3,008
Presold mortgages in process of settlement 1,926 924 � Loans
246,797 248,097 Less Allowance for loan losses �
(4,118 ) �
(3,753
) Net loans 242,679 244,344 � Accrued interest
receivable 1,678 1,672 Foreclosed assets, net 2,025 2,450 Property
and equipment, net 9,578 9,665 Other assets �
3,607 �
�
3,371 � � Total assets
$
323,201 �
$ 324,788 � �
LIABILITIES AND STOCKHOLDERS' EQUITY � Liabilities Deposits
$ 240,795 $ 242,366 Short-term borrowings 8,877 5,084 Long-term
borrowings 54,048 58,048 Accrued interest payable 502 528 Accounts
payable and accrued expenses �
1,166 � �
1,032 � � Total liabilities �
305,388 � �
307,058 � � Stockholder's Equity: Preferred stock, no
par value, 5,000,000 shares authorized; no shares issued and
outstanding $ - $ - Common stock, no par value, authorized
20,000,000 shares; 1,309,501 shares issued and outstanding in 2007
and 2006 1,607 1,607 Retained earnings, substantially restricted
17,139 17,117 Accumulated other comprehensive loss �
(933 ) �
(994 )
� Total stockholders' equity �
17,813 � �
17,730 � � Total liabilities and stockholders' equity
$ 323,201 �
$
324,788 � � * Derived from audited financial
statements � �
KS Bancorp, Inc and
Subsidiary
Consolidated Statements of Income (Unaudited) � � � � Three
Months Ended March 31,
2009 �
2008 (In
thousands, except per share data) �
Interest and dividend
income: Loans $ 3,781 $ 4,542
Investment securities
Taxable 297 309 Tax-exempt 358 338 Dividends - 45 Interest-bearing
deposits �
- � �
26 Total interest and
dividend income �
4,436 � �
5,260 �
Interest expense: Deposits 1,637 2,194 Borrowings �
601 � �
683 Total interest expense �
2,238 � �
2,877 � Net interest income
2,198 2,383 � Provision for loan losses �
430 � �
35 � Net interest income after provision for loan
losses �
1,768 � �
2,348 �
Noninterest
income: Service charges on deposit accounts 313 329 Fees from
presold mortgages 134 91 Gain (loss) on sale of investments 104
Other income �
51 � �
38 Total
noninterest income �
602 � �
458 �
Noninterest expenses: Compensation and benefits 1,411 1,495
Occupancy and Equipment 261 242 Data processing & outside
service fees 208 210 Advertising 15 53 Net Foreclosed real estate
27 23 Other �
458 � �
333 Total
noninterest expenses �
2,380 � �
2,356 �
Income before income taxes (10 ) 450 � Income tax (benefit) expense
�
(110 ) �
76 � Net income
$ 100 �
$ 374 �
Basic and Diluted earnings per share
$
0.08 �
$ 0.29 � Dividends
per common share
$ 0.06 �
$
0.13
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