Quaint Oak Bancorp, Inc. (the "Company") (OTCQB:QNTO), the holding
company for Quaint Oak Bank (the "Bank"), announced today that net
income for the quarter ended March 31, 2013 was $140,000, or $0.16
per basic and $0.15 per diluted share, compared to $176,000 or
$0.20 per basic and diluted share for the same period in 2012.
Robert T. Strong, President and Chief Executive Officer stated,
"Last year's performance presented the opportunity to reinvest in
Quaint Oak's personnel and infrastructure in order to continue our
forward momentum. Primarily, this entailed increasing our lending
staff in both the Bank and its mortgage company subsidiary and
expanding and structuring the Credit Administration Team in order
to support increased lending. Secondly, I am pleased to report
that we completed the installation of a core computer platform
upgrade in the first quarter which allows us to offer additional
products and improved electronic delivery. This upgrade is
intended to position the Bank to better serve and potentially
expand our customer base. We realized that these two decisions
would potentially stress first quarter performance. I am
pleased to report, however, that we achieved a record amount of
loan originations during the quarter, having closed on average
approximately $5.3 million in gross loans each month. We
expect that the increase in loan balances will positively impact
net income through subsequent periods of this year."
Mr. Strong continued, "I am also pleased to report that
non-performing loans and non-performing assets continued to improve
having declined from 4.32% to 2.86% of net loans receivable and
from 3.17% to 2.24% of total assets, respectively, at March 31,
2013 compared to the same period one year ago."
In closing, Mr. Strong commented, "It is important to note that
funds we reserved for other potential opportunities were redirected
for use in our existing stock repurchase program. This
resulted in 17,700 shares having been repurchased in 2013 through
the date of this release. I am extremely pleased to report
that along with the stock repurchase activity, the dividend rate
was increased by 25% as a result of our 2012 performance and
optimistic view toward opportunities that lie ahead this
year. As always, in conjunction with our historically strong
repurchase plan, our current and continued business strategy
includes long term profitability and payment of dividends
reflecting our strong commitment to shareholder value."
Net income amounted to $140,000 for the three months ended March
31, 2013, a decrease of $36,000, or 20.5%, compared to net income
of $176,000 for three months ended March 31, 2012. The
decrease in net income on a comparative quarterly basis was
primarily the result of an increase in non-interest expense of
$305,000, offset by increases in net interest income of $75,000 and
non-interest income of $148,000, and decreases in the provision for
loan losses of $19,000 and the provision for income taxes of
$27,000.
The $75,000, or 7.6% increase in net interest income for the
three months ended March 31, 2013 over the comparable period in
2012 was driven by a $59,000, or 4.1% increase in interest income
and a $16,000, or 3.5% decrease in interest expense. The increase
in interest income was primarily due to a $13.4 million increase in
average loans receivable, net, including loans held for sale, which
increased from an average balance of $78.6 million for the three
months ended March 31, 2012 to an average balance of $92.0 million
for the three months ended March 31, 2013. The decrease in
interest expense was primarily attributable to a 28 basis point
decrease in the overall cost of interest-bearing liabilities from
1.98% for the three months ended March 31, 2012 to 1.70% for the
same period in 2013. The average interest rate spread
decreased from 3.53% for the three months ended March 31, 2012, to
3.50% for the same period in 2013 while the net interest margin
decreased from 3.78% for the three months ended March 31, 2012 to
3.69% for the three months ended March 31, 2013.
The $19,000 decrease in the provision for loan losses for the
three months ended March 31, 2013 over the three months ended March
31, 2012 was based on an evaluation of the allowance relative to
such factors as volume of the loan portfolio, concentrations of
credit risk, prevailing economic conditions, prior loan loss
experience and amount of non-performing loans.
The $148,000, or 74.4% increase in non-interest income for the
three months ended March 31, 2013 over the comparable period in
2012 was primarily attributable to a $106,000 increase in the net
gain on the sales of loans held for sale and a $74,000 increase in
fee income generated by Quaint Oak Bank's mortgage banking and
title abstract subsidiaries. These increases were offset by a
$32,000 decrease in the gain on sale of an SBA loan which was sold
during the quarter ended March 31, 2012.
The $305,000, or 37.1% increase in non-interest expense for the
three months ended March 31, 2013 compared to the same period in
2012 was primarily attributable to a $212,000 increase in salaries
and employee benefits expense, a $33,000 increase in occupancy and
equipment expense, a $23,000 increase in other expense, a $22,000
increase in professional fees and a $12,000 increase in advertising
expense. The increase in salaries and employee benefits
expense for the 2013 period compared to 2012 was primarily
attributable to increased staff as the Company expanded its
mortgage banking and lending operations. The increase in
occupancy and equipment expense was primarily related to the move
of our Delaware Valley office from 607 Lakeside Office Park,
Southampton, PA to a larger facility at 501 Knowles Avenue,
Southampton, PA and computer system upgrades. The increase in
professional fees was primarily due to costs related compliance and
loan collections.
The $27,000, or 23.9% decrease in the provision for income taxes
for the three months ended March 31, 2013 over the three month
period ended March 31, 2012 was due primarily to the decrease in
pre-tax income as our effective tax rate remained relatively
consistent at 38.1% for the 2013 period compared to 39.1% for the
comparable period in 2012.
The Company's total assets at March 31, 2013 were $122.8
million, an increase of $5.4 million, or 4.6%, from $117.4 million
at December 31, 2012. This growth in total assets was
primarily due to increases in loans receivable, net of $6.0 million
and loans held for sale of $215,000. Offsetting these
increases were decreases in investment securities of $464,000, as a
result of calls, and cash and cash equivalents of $406,000.
Total interest-bearing deposits increased $6.1 million, or 6.2%,
to $103.1 million at March 31, 2013 from $97.0 million at December
31, 2012. This increase in deposits was primarily attributable to
increases of $3.2 million in certificates of deposit and $2.8
million in eSavings accounts.
Total stockholders' equity decreased $38,000 to $16.80 million
at March 31, 2013 from $16.84 million at December 31, 2012.
Contributing to the decrease were dividends paid of $40,000 and the
purchase of 13,900 shares of the Company's stock as part of the
Company's stock repurchase program, for an aggregate purchase price
of $210,000. These decreases were partially offset by
increases in net income for the quarter ended March 31, 2013 of
$140,000, amortization of stock awards and options under our stock
compensation plans of $30,000, common stock earned by participants
in the employee stock ownership plan of $26,000, and accumulated
other comprehensive income of $16,000.
Non-performing loans amounted to $2.6 million, or 2.86% of net
loans receivable at March 31, 2013, consisting of thirty-two loans,
twenty-one of which are on non-accrual status and eleven of which
are 90 days or more past due and accruing interest. Comparably,
non-performing loans amounted to $2.1 million, or 2.54% of net
loans receivable at December 31, 2012, consisting of twenty-six
loans, seventeen of which were on non-accrual status and nine of
which were 90 days or more past due and accruing interest. The
non-performing loans at March 31, 2013 include sixteen one-to-four
family non-owner occupied residential loans, nine home equity
loans, three commercial real estate loans, three one-to-four family
owner-occupied residential loans, and one consumer non-real estate
loan, and all are generally well-collateralized or adequately
reserved for. During the quarter ended March 31, 2013, six
loans were placed on non-accrual status resulting in the reversal
of approximately $17,000 of previously accrued interest income and
two loans that were on non-accrual were returned to accrual
status. Included in non-performing loans are six loans
identified as troubled debt restructurings which totaled $365,000
at March 31, 2013. The Company had two additional troubled
debt restructuring not included in non-performing loans at March
31, 2013 in the amount of $248,000 that were current. The
allowance for loan losses as a percent of total loans receivable
was 1.00% at March 31, 2013 and 1.01% at December 31, 2012.
Other real estate owned (OREO) amounted to $199,000 at March 31,
2013, consisting of three properties. These are the same three
properties that totaled $170,000 at December 31, 2012. The
$29,000 increase is attributable to capital improvements made on
two of the properties during the quarter ended March 31, 2013.
Quaint Oak Bancorp, Inc. is the holding company for Quaint Oak
Bank. Quaint Oak Bank is a Pennsylvania-chartered stock savings
bank headquartered in Southampton, Pennsylvania and conducts
business through its two banking offices located in Bucks County
and Lehigh County, Pennsylvania.
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.
Such forward-looking statements are subject to risks and
uncertainties which could cause actual results to differ materially
from those currently anticipated due to a number of factors.
Factors which could result in material variations include, but are
not limited to, changes in interest rates which could affect net
interest margins and net interest income, competitive factors which
could affect net interest income and noninterest income, changes in
demand for loans, deposits and other financial services in the
Company's market area; changes in asset quality, general economic
conditions as well as other factors discussed in documents filed by
the Company with the Securities and Exchange Commission from time
to time. The Company undertakes no obligation to update these
forward-looking statements to reflect events or circumstances that
occur after the date on which such statements were made.
QUAINT OAK BANCORP,
INC. |
Consolidated Balance
Sheets |
(In Thousands) |
|
|
|
|
|
|
|
At March 31,
2013 |
At December 31,
2012 |
Assets |
(Unaudited) |
(Unaudited) |
Cash and cash equivalents |
$11,994 |
$12,400 |
Investment in interest-earning time
deposits |
8,137 |
8,132 |
Investment securities available for sale
at fair value |
3,530 |
3,994 |
Loans held for sale |
5,090 |
4,875 |
Loans receivable, net of allowance for
loan losses (2013: $912; 2012: $860) |
90,302 |
84,291 |
Accrued interest receivable |
736 |
657 |
Investment in Federal Home Loan Bank
stock, at cost |
373 |
437 |
Premises and equipment, net |
1,707 |
1,608 |
Other real estate owned, net |
199 |
170 |
Prepaid expenses and other assets |
731 |
811 |
Total Assets |
$122,799 |
$117,375 |
|
|
|
Liabilities and Stockholders'
Equity |
|
|
Liabilities |
|
|
Deposits, interest-bearing |
$103,085 |
$97,038 |
Federal Home Loan Bank advances and other
borrowings |
2,000 |
2,000 |
Accrued interest payable |
84 |
81 |
Advances from borrowers for taxes and
insurance |
543 |
991 |
Accrued expenses and other
liabilities |
288 |
428 |
Total Liabilities |
106,000 |
100,538 |
|
|
|
Stockholders' Equity |
16,799 |
16,837 |
Total Liabilities and
Stockholders' Equity |
$122,799 |
$117,375 |
|
QUAINT OAK BANCORP,
INC. |
Consolidated Statements
of Income |
(In Thousands, except share
data) |
|
|
|
|
For the Three
Months Ended March 31, |
|
2013 |
2012 |
|
(Unaudited) |
Interest Income |
$1,494 |
$1,435 |
Interest Expense |
435 |
451 |
Net Interest Income |
1,059 |
984 |
Provision for Loan Losses |
52 |
71 |
Net Interest Income after
Provision for Loan Losses |
1,007 |
913 |
Non-Interest Income |
347 |
199 |
Non-Interest Expense |
1,128 |
823 |
Income before Income
Taxes |
226 |
289 |
Income Taxes |
86 |
113 |
Net Income |
$140 |
$176 |
|
|
Per Common Share Data: |
Three Months
Ended |
|
March
31, |
|
2013 |
2012 |
Earnings per share – basic |
$0.16 |
$0.20 |
Average shares outstanding – basic |
892,666 |
880,380 |
Earnings per share – diluted |
$0.15 |
$0.20 |
Average shares outstanding –
diluted |
930,816 |
886,222 |
|
|
|
Tangible book value per share, end of
period |
$17.32 |
$16.36 |
Shares outstanding, end of period |
969,921 |
987,126 |
|
|
|
Three Months
Ended |
|
March
31, |
Selected Operating
Ratios: |
2013 |
2012 |
Average yield on interest-earning
assets |
5.20% |
5.51% |
Average rate on interest-bearing
liabilities |
1.70% |
1.98% |
Average interest rate spread |
3.50% |
3.53% |
Net interest margin |
3.69% |
3.78% |
Average interest-earning assets to
average interest-bearing liabilities |
112.49% |
114.29% |
Efficiency ratio |
80.17% |
69.57% |
|
|
|
Asset Quality Ratios
(1): |
|
|
Non-performing loans as a percent
of total loans receivable, net |
2.86% |
4.32% |
Non-performing assets as a percent
of total assets |
2.24% |
3.17% |
Allowance for loan losses as a
percent of non-performing loans |
35.36% |
25.91% |
Allowance for loan losses as a
percent of total loans receivable |
1.00% |
1.11% |
|
|
|
(1) Asset quality ratios are end
of period ratios. |
CONTACT: Quaint Oak Bancorp, Inc.
Robert T. Strong, President and Chief Executive Officer
(215) 364-4059
Quaint Oak Bancorp (QB) (USOTC:QNTO)
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