May 05, 2015
OTC Disclosure & News Service
Home Financial Bancorp (“Company”) (OTCQB Symbol “HWEN”), an Indiana corporation which is the holding company for Our Community Bank, (“Bank”) based in Spencer, Indiana, announces results for the third quarter and nine months ended March 31, 2015.
Third Quarter Highlights:
- Net Interest Income declined 7%, or $56,000;
- Non-interest income more than doubled to $188,000;
- Net income increased 64%, from $105,000 to $172,000 or $.15 per share.
Nine Month Highlights:
- Non-performing loans decreased 34%, or $398,000;
- Net interest income fell 8%, or $187,000;
- Non-interest income increased 32%, or $108,000;
- Salaries and employee benefits declined 8%, or $87,000;
- Net income decreased 10%, from $289,000 to $261,000.
For the quarter ended March 31, 2015, the Company reported net income of $172,000 or $.15 basic and diluted earnings per share. For the same period last year, the Company reported net income of $105,000 or $.09 per share. Net income was higher, compared to third quarter 2014 results, due to nonrecurring income from key-man life insurance proceeds associated with the death of Executive Vice President and Chief Financial Officer, Gary (Mike) Monnett in January, 2015.
Due to declining interest income on loans, total interest income was lower by $79,000 or 9%, while interest expense fell $22,000 or 15% during the quarter ended March 31, 2015. As a result, net interest income decreased $57,000, or 8%, for the three months ended March 31, 2015, compared to the same period in 2014.
Loan loss provisions for third quarter 2015 totaled $40,000. Loan loss provisions were $34,000 for the same period a year earlier. A regular assessment of loan loss allowance adequacy indicated that these provisions were necessary to maintain an appropriate allowance level. Net loan losses totaled $3,000, compared to $224,000 for third quarter 2014. Changes in volume, composition and quality of the loan portfolio, as well as actual loan loss experience, will influence the need for future loss provisions.
Third quarter 2015 non-interest income totaled $188,000 compared to $87,000 a year earlier. In 2015 the quarter included $100,000 from nonrecurring life insurance proceeds. Non-interest expense for the quarter ended March 31, 2015 totaled $679,000, compared to $698,000 for the same period a year earlier. Non-interest expense includes salaries and employee benefits, which decreased $52,000 and were partially offset by a $19,000 increase in legal and professional fees.
For the nine-month period ended March 31, 2015, the Company reported net income of $261,000 or $.22 earnings per share. Net income was $289,000 or $.24 earnings per share for the year-earlier period. Net income was lower due to a continued decline in interest income; particularly from lower loan yields and lower balances of total loans.
Total interest income decreased $248,000, or 9%. Interest expense fell $61,000 or 13%. Consequently, net interest income before provisions for loan losses dropped $187,000 or 8%, compared to the same period in 2014.
For the nine-month period ended March 31, 2015, loan loss provisions were $160,000 and totaled $154,000 for the nine-month period ended March 31, 2014. Loan loss provisions reflect management’s assessment of various risk factors including, but not limited to, the level and trend of loan delinquencies and losses. Net loan losses totaled $135,000 during the first three quarters of fiscal 2015, compared to $298,000 for the year-earlier period.
Total non-interest income rose $108,000, or 32%. Nonrecurring income from life insurance proceeds account for most of the change in non-interest income. Total non-interest expense decreased $10,000, compared to the same nine-months during the prior year. Salaries and employee benefits decreased $87,000, or 8%. Repossessed property expense fell $14,000 or 12%. Partially offsetting these decreases, computer processing fees increased $34,000, or 14%. Legal and professional fees also increased $26,000 or 22%, compared to the same period a year earlier.
At March 31, 2015, total assets were $65.9 million. Total assets were $67.8 million nine months earlier. Cash and interest-bearing deposits totaled $7.7 million. Investment securities available for sale increased $1.0 million to $7.8 million. Total loans decreased 6% to $46.5 million, from $49.4 million at June 30, 2014.
Loans delinquent 90 days or more decreased 34% and totaled $766,000, or 1.7% of total loans at March 31, 2015. At June 30, 2014, non-performing loans were $1.2 million, or 2.4% of total loans. Total non-performing assets were $1.2 million, or 1.8% of total assets at March 31, 2015, compared to $1.5 million, or 2.2% of total assets at June 30, 2014. Non-performing assets included $416,000 in Other Real Estate Owned (“OREO”) and other repossessed properties at March 31, 2015, compared to $330,000 nine months earlier.
The balance of the loan loss allowance increased 5% to $509,000, or 1.1% of total loans at March 31, 2015, compared to $484,000, or 1.0% of total loans at June 30, 2014. Management considered the level of loan loss allowances at March 31, 2015 to be adequate to cover estimated losses inherent in the loan portfolio at that date.
Deposits decreased to $48.0 million as of March 31, 2015, from $48.7 million nine months earlier. Total borrowings declined $1.5 million, or 15%, to $8.5 million.
Shareholders’ equity was $8.9 million, or 13.5% of total assets at March 31, 2015, compared to $8.7 million or 12.8% of total assets at June 30, 2014. Factors impacting shareholder equity during the first three quarters of fiscal 2015 included net income, three quarterly cash dividends totaling $.09 per share, $80,000 net decrease in unrealized loss on securities available for sale, and a $12,000 decrease in equity components associated with a stock-based employee benefit plan. During the nine months ended March 31, 2015, the Company repurchased 4,500 shares of its stock. At March 31, 2015, the Company’s book value per share was $7.48 based on 1,191,583 shares outstanding. The last reported price per share on March 31, 2015 was $5.70.
Home Financial Bancorp and Our Community Bank, an FDIC-insured, Indiana stock commercial bank, operate from headquarters in Spencer, Indiana, and a branch office in Cloverdale, Indiana. Additional information concerning Home Financial Bancorp and its subsidiaries is available at www.h$fbancorp.com or www.ocbconnect.com.
HOME FINANCIAL BANCORP
FOR THREE MONTHS ENDED MARCH 31:
|Net Interest Income||$700||$756|
|Provision for Loan Losses||40||34|
|Basic and Diluted Earnings Per Share:||$.15||$.09|
|Average Shares Outstanding – Basic||1,184,614||1,188,577|
|Average Shares Outstanding – Diluted||1,184,919||1,190,327|
FOR NINE MONTHS ENDED MARCH 31:
|Net Interest Income||$2,117||$2,304|
|Provision for Loan Losses||160||154|
|Basic and Diluted Earnings Per Share:||$.22||$.24|
|Average Shares Outstanding – Basic||1,186,725||1,187,045|
|Average Shares Outstanding – Diluted||1,187,978||1,189,219|
|Allowance for Loan Losses||509||484|
|Non-Performing Assets to Total Assets||1.79||%||2.20||%|
|Non-Performing Loans to Total Loans||1.65||2.35|
|Book Value Per Share*||$7.48||$7.27|
*Based on 1,191,583 shares at March 31, 2015 and 1,196,083 shares at June 30, 2014.
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Source: otc markets