UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934
For Quarter Ended: March 31, 2005
Commission File Number: 0-19345
ESB FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
| Pennsylvania | 25-1659846 | |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) | |
| 600 Lawrence Avenue, Ellwood City, PA | 16117 | |
| (Address of principal executive offices) | (Zip Code) | |
(724) 758-5584
(Registrant’s telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the Registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2) Yes x No ¨
Number of shares of common stock outstanding as of April 30, 2005:
| Common Stock, $0.01 par value | 13,500,786 shares | |
| (Class) | (Outstanding) |
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
ESB Financial Corporation and Subsidiaries
Consolidated Statements of Financial Condition
As of March 31, 2005 and December 31, 2004 (Unaudited)
(Dollar amounts in thousands)
| March 31, 2005 |
December 31, 2004 |
|||||||
| Assets | ||||||||
| Cash on hand and in banks |
$ | 9,902 | $ | 6,100 | ||||
| Interest-earning deposits |
15,413 | 7,470 | ||||||
| Federal funds sold |
1,733 | 4,133 | ||||||
| Cash and cash equivalents |
27,048 | 17,703 | ||||||
| Securities available for sale; cost of $1.1 billion and $920,443 |
1,094,690 | 929,794 | ||||||
| Loans receivable, net of allowance for loan losses of $5,316 and $3,940 |
497,107 | 343,524 | ||||||
| Accrued interest receivable |
9,329 | 7,843 | ||||||
| Federal Home Loan Bank (FHLB) stock |
33,967 | 31,607 | ||||||
| Premises and equipment, net |
13,954 | 9,592 | ||||||
| Real estate acquired through foreclosure, net |
1,234 | 1,303 | ||||||
| Real estate held for investment |
12,474 | 12,612 | ||||||
| Goodwill |
41,086 | 7,127 | ||||||
| Intangible assets |
4,825 | 500 | ||||||
| Bank owned life insurance |
25,814 | 25,586 | ||||||
| Prepaid expenses and other assets |
16,717 | 7,324 | ||||||
| Total assets |
$ | 1,778,245 | $ | 1,394,515 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Liabilities: |
||||||||
| Deposits |
$ | 825,817 | $ | 580,346 | ||||
| FHLB advances |
643,265 | 601,242 | ||||||
| Repurchase agreements |
87,000 | 67,000 | ||||||
| Other borrowings |
19,106 | 19,320 | ||||||
| Junior subordinated notes |
51,313 | 15,211 | ||||||
| Advance payments by borrowers for taxes and insurance |
2,039 | 1,642 | ||||||
| Accrued expenses and other liabilities |
20,405 | 11,953 | ||||||
| Total liabilities |
1,648,945 | 1,296,714 | ||||||
| Stockholders’ Equity: |
||||||||
| Preferred stock, $.01 par value, 5,000,000 shares authorized; none issued |
— | — | ||||||
| Common stock, $.01 par value, 30,000,000 shares authorized; |
138 | 109 | ||||||
| Additional paid-in capital |
100,479 | 60,940 | ||||||
| Treasury stock, at cost; 292,629 and 247,725 shares |
(3,997 | ) | (3,394 | ) | ||||
| Unearned Employee Stock Ownership Plan (ESOP) shares |
(5,259 | ) | (5,518 | ) | ||||
| Unvested shares held by Management Recognition Plan (MRP) |
(309 | ) | (332 | ) | ||||
| Retained earnings |
41,245 | 40,408 | ||||||
| Accumulated other comprehensive (loss) income, net |
(2,997 | ) | 5,588 | |||||
| Total stockholders’ equity |
129,300 | 97,801 | ||||||
| Total liabilities and stockholders’ equity |
$ | 1,778,245 | $ | 1,394,515 | ||||
See accompanying notes to unaudited consolidated financial statements.
1
ESB Financial Corporation and Subsidiaries
Consolidated Statements of Operations
For the three months ended March 31, 2005 and 2004 (Unaudited)
(Dollar amounts in thousands, except share data)
| Three Months Ended March 31, | |||||||
| 2005 |
2004 | ||||||
| Interest income: |
|||||||
| Loans receivable |
$ | 6,292 | $ | 5,053 | |||
| Taxable securities available for sale |
9,897 | 8,862 | |||||
| Tax-exempt securities available for sale |
1,323 | 1,192 | |||||
| FHLB stock |
185 | 77 | |||||
| Interest-earning deposits and federal funds sold |
25 | 16 | |||||
| Total interest income |
17,722 | 15,200 | |||||
| Interest expense: |
|||||||
| Deposits |
3,383 | 2,713 | |||||
| Borrowed funds |
6,326 | 5,762 | |||||
| Junior subordinated notes |
537 | 254 | |||||
| Total interest expense |
10,246 | 8,729 | |||||
| Net interest income |
7,476 | 6,471 | |||||
| (Recovery of) provision for loan losses |
(16 | ) | 19 | ||||
| Net interest income after (recovery of) provision for loan losses |
7,492 | 6,452 | |||||
| Noninterest income: |
|||||||
| Fees and service charges |
647 | 434 | |||||
| Net gain on sale of loans |
2 | 13 | |||||
| Increase of cash surrender value of bank owned life insurance |
228 | 234 | |||||
| Net realized gain on sale of securities available for sale |
— | 943 | |||||
| Income from real estate joint ventures |
229 | 345 | |||||
| Other |
204 | 93 | |||||
| Total noninterest income |
1,310 | 2,062 | |||||
| Noninterest expense: |
|||||||
| Compensation and employee benefits |
3,065 | 2,823 | |||||
| Premises and equipment |
571 | 438 | |||||
| Data processing |
421 | 394 | |||||
| Amortization of intangible assets |
144 | 43 | |||||
| Minority interest |
79 | 140 | |||||
| Loss on early extinguishment of debt |
— | 844 | |||||
| Advertising |
143 | 72 | |||||
| Other |
921 | 801 | |||||
| Total noninterest expense |
5,344 | 5,555 | |||||
| Income before income taxes |
3,458 | 2,959 | |||||
| Provision for income taxes |
597 | 521 | |||||
| Net income |
$ | 2,861 | $ | 2,438 | |||
| Net income per share |
|||||||
| Basic |
$ | 0.24 | $ | 0.24 | |||
| Diluted |
$ | 0.24 | $ | 0.23 | |||
| Cash dividends declared per share |
$ | 0.10 | $ | 0.10 | |||
| Weighted average shares outstanding |
11,716,903 | 10,218,532 | |||||
| Weighted average shares and share equivalents outstanding |
12,036,600 | 10,670,413 | |||||
See accompanying notes to unaudited consolidated financial statements.
2
ESB Financial Corporation and Subsidiaries
Consolidated Statement of Changes in Stockholders’ Equity
For the three months ended March 31, 2005 (Unaudited)
(Dollar amounts in thousands)
| Common stock |
Additional capital |
Treasury stock |
Unearned ESOP shares |
Unvested MRP shares |
Retained earnings |
Accumulated other comprehensive (loss) income net of tax |
Total stockholders’ equity |
|||||||||||||||||||||||
| Balance at January 1, 2005 |
$ | 109 | $ | 60,940 | $ | (3,394 | ) | $ | (5,518 | ) | $ | (332 | ) | $ | 40,408 | $ | 5,588 | $ | 97,801 | |||||||||||
| Comprehensive results: |
||||||||||||||||||||||||||||||
| Net income |
— | — | — | — | — | 2,861 | — | 2,861 | ||||||||||||||||||||||
| Other comprehensive results, net |
— | — | — | — | — | — | (8,634 | ) | (8,634 | ) | ||||||||||||||||||||
| Reclassification adjustment |
— | — | — | — | — | — | 49 | 49 | ||||||||||||||||||||||
| Total comprehensive results |
— | — | — | — | — | 2,861 | (8,585 | ) | (5,724 | ) | ||||||||||||||||||||
| Common stock issued as a result of the acquisition of PHSB Financial Corp. |
29 | 39,473 | — | — | — | — | — | 39,502 | ||||||||||||||||||||||
| Cash dividends at $0.10 per share |
— | — | — | — | — | (1,301 | ) | — | (1,301 | ) | ||||||||||||||||||||
| Purchase of treasury stock, at cost (107,519 shares) |
— | — | (1,510 | ) | — | — | — | — | (1,510 | ) | ||||||||||||||||||||
| Reissuance of treasury stock for stock option exercises |
— | — | 907 | — | — | (723 | ) | — | 184 | |||||||||||||||||||||
| Principal payments on ESOP debt |
— | 66 | — | 259 | — | — | ||||||||||||||||||||||||