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 March 31, 2014 of $638,000, a
decrease of $38,000 compared to net income of $676,000 reported for
the three months ended March 31, 2013. The Company's basic and
diluted earnings per share were both $0.31 for the quarter ended
March 31, 2014, compared to basic and diluted earnings per share of
$0.31 and $0.30, respectively, for the quarter ended March 31,
2013.
The Company reported net income of $2.0 million for the nine
months ended March 31, 2014, a decrease of $499,000 compared to
$2.5 million for the nine months ended March 31, 2013. The
Company's basic and diluted earnings per share were $0.96 and
$0.94, respectively, for the nine months ended March 31, 2014,
compared to $1.04 and $1.01, respectively, for the nine months
ended March 31, 2013.
The decrease in net income for the three months ended March 31,
2014, resulted primarily from a decrease of $143,000, or 18.6%, in
non-interest income, a $97,000, or 4.4%, increase in non-interest
expense and a $3,000, or 0.1%, decrease in net interest income,
partially offset by a $184,000, or 86.0%, decrease in the provision
for loan losses, and a $21,000, or 6.5%, decrease in income tax
expense. The decrease in net interest income for the three months
ended March 31, 2014, was primarily due to a $64,000, or 2.0%,
decrease in total interest income, partially offset by a decrease
of $61,000, or 9.8%, 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 3.71% for the three months ended March 31, 2014,
compared to 3.80% for the three months ended March 31, 2013. The
Company's net interest margin was 3.92% for the three months ended
March 31, 2014, compared to 4.03% for the quarter ended March 31,
2013. The decrease in the average interest rate spread on a
comparative quarterly basis was primarily the result of a decrease
of 22 basis points in average yield on interest-earning assets. The
decrease in net interest margin was primarily the result of a
higher average volume of interest earning assets for the quarter
ended March 31, 2014 compared to the prior year quarterly
period.
The decrease in net income for the nine months ended March 31,
2014, resulted primarily from an $822,000, or 31.4%, decrease in
non-interest income, and an increase of $310,000, or 4.8%, in
non-interest expense partially offset by a $34,000, or 0.4%,
increase in net interest income, a $323,000, or 73.2% decrease in
the provision for loan losses, and a $276,000, or 22.4%, decrease
in income tax expense. The increase in net interest income for the
nine month period was primarily due to a $169,000, or 8.6% decrease
in interest expense on borrowings and deposits due to an overall
decline in the average cost of funds, partially offset by a
$135,000, or 1.4%, decrease in total interest income. The
Company's average interest rate spread was 3.68% for the nine
months ended March 31, 2014, compared to 3.80% for the nine months
ended March 31, 2013. The Company's net interest margin was 3.91%
for the nine months ended March 31, 2014, compared to 4.08% for the
nine months ended March 31, 2013. The decrease in net interest
margin and average interest rate spread on a comparative nine month
basis is attributable primarily to a decrease of 29 basis points in
average yield on interest earning assets for the nine months ended
March 31, 2014 compared to the prior year nine month period.
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 March 31, |
|
2014 |
2013 |
|
Average Balance |
Average
Yield/Rate |
Average Balance |
Average
Yield/Rate |
|
(Dollars in thousands) |
Interest-earning assets: |
|
|
|
|
Investment Securities |
$43,010 |
2.19% |
$55,851 |
2.78% |
Loans Receivable |
224,019 |
5.30 |
201,100 |
5.73 |
Interest-earning deposits |
2,940 |
0.26 |
6,352 |
0.12 |
Total interest-earning assets |
$269,969 |
4.75% |
$263,303 |
4.97% |
|
|
|
|
|
Interest-bearing liabilities: |
|
|
|
|
Savings accounts |
$ 11,603 |
0.19% |
$7,948 |
0.22% |
NOW accounts |
26,941 |
0.85 |
21,776 |
0.77 |
Money market accounts |
45,230 |
0.31 |
38,533 |
0.37 |
Certificates of deposit |
113,963 |
1.49 |
110,439 |
1.67 |
Total interest-bearing deposits |
197,737 |
1.06 |
178,696 |
1.22 |
FHLB advances |
17,357 |
0.85 |
33,567 |
0.91 |
Total interest-bearing liabilities |
$215,094 |
1.04% |
$212,263 |
1.17% |
|
|
|
|
|
|
|
|
|
|
|
For the Nine
Months Ended March 31, |
|
2014 |
2013 |
|
Average Balance |
Average
Yield/Rate |
Average Balance |
Average
Yield/Rate |
|
(Dollars in thousands) |
Interest-earning assets: |
|
|
|
|
Investment securities |
$ 48,080 |
2.17% |
$ 60,601 |
2.94% |
Loans receivable |
218,796 |
5.47 |
193,450 |
5.90 |
Interest-earning deposits |
5,072 |
0.25 |
5,917 |
0.22 |
Total interest-earning assets |
$271,948 |
4.79% |
$259,968 |
5.08% |
|
|
|
|
|
Interest-bearing liabilities: |
|
|
|
|
Savings accounts |
$ 10,851 |
0.21% |
$ 7,140 |
0.26% |
NOW accounts |
26,445 |
0.98 |
19,719 |
0.80 |
Money market accounts |
43,617 |
0.35 |
40,363 |
0.43 |
Certificates of deposit |
114,022 |
1.55 |
108,357 |
1.76 |
Total interest-bearing deposits |
194,935 |
1.13 |
175,579 |
1.29 |
Other bank borrowings |
333 |
5.70 |
-- |
-- |
FHLB advances |
19,060 |
0.88 |
28,773 |
1.24 |
Total interest-bearing liabilities |
$214,328 |
1.11% |
$204,352 |
1.28% |
The $143,000 decrease in non-interest income for the quarter
ended March 31, 2014, compared to the prior year quarterly period
was due to a decrease of $295,000 in gain on sale of loans held for
sale, partially offset by $129,000 in gain on sale of real estate
and an increase of $23,000 in other non-interest income. The
$822,000 decrease in non-interest income for the nine months ended
March 31, 2014, compared to the prior year period was primarily due
to decreases of $752,000 in gain on sale of loans held for sale,
$180,000 in gain on sale of securities, $10,000 in income on bank
owned life insurance and $9,000 in other non-interest income,
partially offset by $129,000 in gain on sale of real
estate. The $129,000 gain on sale of real estate arose from
the disposition of a lot in Bossier City, Louisiana that had been
held for a possible branch location site. The $97,000
increase in non-interest expense for the quarter ended March 31,
2014, compared to the same period in 2013, is primarily
attributable to increases of $71,000 in compensation and benefits,
$54,000 in occupancy and equipment expense, $26,000 in data
processing expense, $7,000 in deposit insurance premiums and $5,000
in audit and examination fees. These increases were partially
offset by decreases of $69,000 in legal fees and $2,000 in other
non-interest expenses.
The $310,000 increase in non-interest expense for the nine
months ended March 31, 2014, compared to the same period in 2013,
is primarily attributable to increases of $136,000 in compensation
and benefits expense, $94,000 in occupancy and equipment expense,
$43,000 in other non-interest expenses, $40,000 in data processing,
$39,000 in franchise and bank shares taxes and $14,000 in
advertising expense. These increases were partially offset by
a decrease of $78,000 in legal fees.
At March 31, 2014, the Company reported total assets of $289.5
million, an increase of $12.4 million, or 4.5%, compared to total
assets of $277.2 million at June 30, 2013. The increase in assets
was comprised primarily of increases in loans receivable, net of
$12.7 million, or 6.1%, from $206.1 million at June 30, 2013, to
$218.7 million at March 31, 2014, loans held-for-sale of $3.3
million, or 96.2%, from $3.5 million at June 30, 2013, to $6.8
million at March 31, 2014, cash and cash equivalents of $3.0
million, or 80.4%, from $3.7 million at June 30, 2013 to $6.6
million at March 31, 2014, and an increase in other assets of $1.6
million, or 11.3%, from $14.5 million at June 30, 2013 to $16.1
million at March 31, 2014. These increases were partially
offset by a decrease in investment securities of $8.2 million, or
16.6%, from $49.4 million at June 30, 2013, to $41.2 million at
March 31, 2014. The increase in loans held-for-sale results
primarily from an increase at March 31, 2014 in receivables from
financial institutions purchasing the Company's loans
held-for-sale.
The following table shows total loans originated and sold during
the periods indicated.
|
Nine Months Ended
March 31, |
|
|
2014 |
2013 |
% Change |
|
(In thousands) |
|
Loan originations: |
|
|
|
One- to four-family residential |
$ 97,574 |
$124,945 |
(21.9)% |
Commercial — real estate secured
(owner occupied and non-owner occupied) |
12,715 |
13,780 |
(7.7)% |
Multi-family residential |
-- |
7,289 |
(100.0)% |
Commercial business |
31,036 |
5,787 |
436.3% |
Land |
7,627 |
4,164 |
83.2% |
Construction |
20,172 |
22,562 |
(10.6)% |
Home equity loans and lines of credit and
other consumer |
651 |
2,228 |
(70.8)% |
Total loan originations |
$169,775 |
$180,755 |
(6.1)% |
Loans sold |
$ (49,753) |
$ (91,702) |
(45.7)% |
Included in the $20.2 million and $22.6 million of
construction loan originations for the nine months ended March 31,
2014 and 2013, respectively, are approximately $13.4 million and
$19.8 million, respectively, of one- to four-family residential
construction loans and $6.8 million and $2.8 million, respectively,
of commercial and multi-family construction loans, all of which are
primarily located in the Company's market area.
Total liabilities increased $12.4 million, or 5.3%,
from $235.2 million at June 30, 2013, to $247.5 million at March
31, 2014, primarily due to an increase in total deposits of $17.3
million, or 8.2%, to $229.2 million at March 31, 2014, compared to
$211.9 million at June 30, 2013. Total non-interest bearing demand
deposits increased $6.4 million, or 24.8%, from $26.0 million at
June 30, 2013 to $32.5 million at March 31, 2014. At both March 31,
2014 and June 30, 2013, the Company had $12.7 million in brokered
deposits. The Company utilizes brokered certificates of deposit as
a component of its strategy for lowering Home Federal Bank's
overall cost of funds. 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. Advances from the Federal Home Loan Bank of Dallas
decreased $4.2 million, or 19.4%, to $17.5 million at March 31,
2014, from $21.7 million at June 30, 2013.
At March 31, 2014, the Company had $294,000 of
non-performing assets compared to $649,000 of non-performing assets
at June 30, 2013, consisting of four single-family residential
loans, and one non-performing line of credit at both periods. At
March 31, 2014, the Company had one residential mortgage loan
classified as substandard in the aggregate amount of $71,000
compared to three commercial loans and one residential mortgage
loan in the aggregate amount of $5.3 million at June 30, 2013. The
Company had one line of credit classified as doubtful in the amount
of $27,000 at both March 31, 2014 and June 30, 2013.
Shareholders' equity was $42.0 million at March 31, 2014
and June 30, 2013. The primary changes within shareholders'
equity from June 30, 2013, were dividends paid of $416,000,
acquisition of treasury stock of $2.3 million, and a decrease in
the Company's accumulated other comprehensive income of $63,000.
These decreases were offset by net income of $2.0 million, proceeds
from the issuance of common stock from the exercise of stock
options of $272,000, and the vesting of restricted stock awards,
stock options and release of employee stock ownership plan shares
totaling $526,000.
The Company repurchased 7,346 shares of its common stock
under its stock repurchase programs during the quarter ended March
31, 2014 at an average price per share of $17.64. On January
8, 2014, the Company announced that its Board of Directors approved
a fourth stock repurchase program for the repurchase of up to an
additional 115,000 shares. As of March 31, 2014, there were a
total of 117,109 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) |
|
March 31, 2014 |
June 30, 2013 |
ASSETS |
(Unaudited) |
|
|
|
Cash and cash equivalents |
$ 6,649 |
$ 3,685 |
Securities available for sale at fair
value |
40,094 |
47,961 |
Securities held to maturity (fair value March
31, 2014: $1,113 June 30, 2013: $1,465) |
1,113 |
1,465 |
Loans held-for-sale |
6,795 |
3,464 |
Loans receivable, net of allowance for loan
losses (March 31, 2014: $2,346; June 30, 2013: $2,240) |
218,731 |
206,079 |
Other assets |
16,142 |
14,501 |
|
|
|
Total assets |
$289,524 |
$277,155 |
|
|
|
LIABILITIES AND SHAREHOLDERS'
EQUITY |
|
|
|
|
|
Deposits |
$229,246 |
$211,922 |
Advances from the Federal Home Loan Bank of
Dallas |
17,454 |
21,662 |
Other liabilities |
845 |
1,589 |
|
|
|
Total liabilities |
247,545 |
235,173 |
|
|
|
Shareholders' equity |
41,979 |
41,982 |
|
|
|
Total liabilities and shareholders'
equity |
$289,524 |
$277,155 |
|
|
Home Federal Bancorp,
Inc. of Louisiana |
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME |
(In thousands, except per share
data) |
|
|
Three Months
Ended March 31, |
Nine Months Ended
March 31, |
|
2014 |
2013 |
2014 |
2013 |
|
(Unaudited) |
(Unaudited) |
Interest income |
|
|
|
|
Loans, including fees |
$ 2,968 |
$2,880 |
$ 8,979 |
$8,564 |
Investment securities |
1 |
5 |
4 |
20 |
Mortgage-backed securities |
235 |
383 |
780 |
1,314 |
Other interest-earning assets |
2 |
2 |
10 |
10 |
Total interest income |
3,206 |
3,270 |
9,773 |
9,908 |
Interest expense |
|
|
|
|
Deposits |
522 |
543 |
1,652 |
1,693 |
Federal Home Loan Bank borrowings |
37 |
76 |
125 |
263 |
Other bank borrowings |
-- |
1 |
14 |
4 |
Total interest expense |
559 |
620 |
1,791 |
1,960 |
Net interest income |
2,647 |
2,650 |
7,982 |
7,948 |
|
|
|
|
|
Provision for loan losses |
30 |
214 |
118 |
441 |
Net interest income after provision for
loan losses |
2,617 |
2,436 |
7,864 |
7,507 |
|
|
|
|
|
Non-interest income |
|
|
|
|
Gain on sale of real estate |
129 |
-- |
129 |
-- |
Gain on sale of loans |
360 |
655 |
1,240 |
1,992 |
Gain on sale of securities |
1 |
-- |
35 |
215 |
Income on Bank Owned Life Insurance |
43 |
44 |
131 |
141 |
Other income |
94 |
71 |
264 |
273 |
|
|
|
|
|
Total non-interest
income |
627 |
770 |
1,799 |
2,621 |
|
|
|
|
|
Non-interest expense |
|
|
|
|
Compensation and benefits |
1,474 |
1,403 |
4,204 |
4,068 |
Occupancy and equipment |
202 |
148 |
634 |
540 |
Data Processing |
152 |
126 |
353 |
313 |
Audit and Examination Fees |
57 |
52 |
163 |
158 |
Franchise and Bank Shares Tax |
85 |
84 |
263 |
224 |
Advertising |
62 |
61 |
195 |
181 |
Legal fees |
82 |
151 |
320 |
398 |
Loan and collection |
28 |
25 |
92 |
87 |
Deposit insurance premium |
39 |
32 |
107 |
95 |
Other expenses |
123 |
125 |
381 |
338 |
|
|
|
|
|
Total non-interest
expense |
2,304 |
2,207 |
6,712 |
6,402 |
|
|
|
|
|
Income before income taxes |
940 |
999 |
2,951 |
3,726 |
Provision for income tax expense |
302 |
323 |
955 |
1,231 |
|
|
|
|
|
NET INCOME |
$ 638 |
$ 676 |
$ 1,996 |
$ 2,495 |
|
|
|
|
|
EARNINGS PER SHARE |
|
|
|
|
Basic |
$ 0.31 |
$ 0.31 |
$ 0.96 |
$ 1.04 |
Diluted |
$ 0.31 |
$ 0.30 |
$ 0.94 |
$ 1.01 |
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended March 31, |
Nine Months Ended
March 31, |
|
2014 |
2013 |
2014 |
2013 |
|
(Unaudited) |
(Unaudited) |
Selected Operating
Ratios(1): |
|
|
|
|
Average interest rate spread |
3.71% |
3.80% |
3.68% |
3.80% |
Net interest margin |
3.92% |
4.03% |
3.91% |
4.08% |
Return on average assets |
0.87% |
0.97% |
0.91% |
1.21% |
Return on average equity |
5.91% |
6.33% |
6.08% |
7.20% |
|
|
|
|
|
Asset Quality
Ratios(2): |
|
|
|
|
Non-performing assets as a percent of
total assets |
0.10% |
0.28% |
0.10% |
0.28% |
Allowance for loan losses as a percent of
non-performing loans |
797.50% |
276.29% |
797.50% |
276.29% |
Allowance for loan losses as a percent of
total loans receivable |
1.06% |
1.07% |
1.06% |
1.07% |
|
|
|
|
|
Per Share Data: |
|
|
|
|
Shares outstanding at period end |
2,243,047 |
2,361,879 |
2,243,047 |
2,361,879 |
Weighted average shares outstanding: |
|
|
|
|
Basic |
2,030,216 |
2,180,265 |
2,081,010 |
2,399,921 |
Diluted |
2,081,572 |
2,246,667 |
2,130,561 |
2,467,577 |
Tangible book value at period end |
$ 18.72 |
$17.92 |
$ 18.72 |
$17.92 |
|
|
|
|
|
|
|
|
|
|
(1) Ratios for the three and nine
month periods are annualized. |
(2) Asset quality ratios are end
of period ratios. |
CONTACT: James R. Barlow
President and Chief Operating Officer
(318) 222-1145
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