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8-K - FORM 8-K - HOME BANCORP, INC.d8k.htm

Exhibit 99.1

For further information contact:

John W. Bordelon, President and CEO

(337) 237-1960

 

Release Date:    April 26, 2011
   For Immediate Release

HOME BANCORP ANNOUNCES 2011 FIRST QUARTER RESULTS

Lafayette, Louisiana – Home Bancorp, Inc. (Nasdaq: “HBCP”) (the “Company”), the parent company for Home Bank (www.home24bank.com), a Federally chartered savings bank headquartered in Lafayette, Louisiana (the “Bank”), announced net income of $795,000 for the first quarter of 2011, a decrease of $670,000 compared to the fourth quarter of 2010 and a decrease of $51,000 compared to the first quarter of 2010. Diluted earnings per share were $0.11 for the first quarter of 2011 and the fourth quarter of 2010, compared to $0.20 first quarter of 2010.

“Although loan demand was modest to start the year,” stated John W. Bordelon, President and Chief Executive Officer of the Company and the Bank, “we continue to enjoy excellent core deposit growth, which increased at an annualized rate of over 14% during the first quarter.”

“We finished the quarter by announcing our expansion into Orleans and Jefferson Parishes through the acquisition of Guaranty Savings Bank,” added Mr. Bordelon. “We are confident that Guaranty’s talented team of bankers and Home Bank’s commitment to enhancing the long-term success of our customers will set us apart in New Orleans just as it has in our other markets.”

Acquisition of GS Financial Corp.

As previously disclosed on March 30, 2011, the Company entered into a definitive agreement to merge with GS Financial Corp. (Nasdaq: “GSLA”), the holding company of the 74-year-old Guaranty Savings Bank. Under the terms of the agreement, GS Financial will be merged with and into Home Bancorp in a two-step transaction and Guaranty Savings Bank will be merged with and into the Bank. Shareholders of GS Financial will receive $21.00 per share in cash upon completion of the merger. The merger, which is expected to be completed in the third quarter of 2011, is subject to GS Financial Corp. shareholder approval, regulatory approval and other customary conditions. The Company anticipates that the transaction will be over 10% accretive to earnings once savings are fully phased in by 2012. The dilution to tangible book value is expected to be minimal. Upon completion of the merger, the combined company will have total assets of approximately $950 million, $625 million in loans and $750 million in deposits. The Company incurred $191,000 in pre-tax merger-related expenses during the first quarter of 2011.

Loans and Credit Quality

The Company’s total loans were $442.0 million at March 31, 2011, an increase of $2.1 million, or 1%, from December 31, 2010, and a decrease of $8.3 million, or 2%, from March 31, 2010. During the first quarter of 2011, Noncovered Loans increased $6.5 million, while Covered Loans decreased $4.5 million. Growth in the Noncovered Loan portfolio was in commercial and industrial (up $6.2 million) and commercial real estate (up $1.3 million) loans. Growth in these portfolios was partially offset by decreases in Noncovered one- to four-family first mortgage (down $933,000) and construction and land (down $918,000) loans.


The following table sets forth the composition of the Company’s loan portfolio as of the dates indicated.

 

(dollars in thousands)

   March 31,
2011
     December 31,
2010
     Total Loans
Increase/(Decrease)
 

Noncovered real estate loans:

          

One- to four-family first mortgage

   $ 104,224       $ 105,157       $ (933     (1 )% 

Home equity loans and lines

     24,796         24,898         (102     —     

Commercial real estate

     117,264         115,946         1,318        1   

Construction and land

     44,259         45,177         (918     (2

Multi-family residential

     4,634         4,493         141        3   
                                  

Total noncovered real estate loans

     295,177         295,671         (494     —     
                                  

Noncovered other loans:

          

Commercial

     48,440         42,247         6,193        15   

Consumer

     22,386         21,546         840        4   
                                  

Total noncovered other loans

     70,826         63,793         7,033        11   
                                  

Total noncovered loans

     366,003         359,464         6,539        2   

Covered loans

     75,996         80,447         (4,451     (6
                                  

Total loans

   $ 441,999       $ 439,911       $ 2,088        1   
                                  

Credit quality statistics remained exceptional during the first quarter of 2011. Nonperforming assets, excluding Covered Assets, were $1.2 million at March 31, 2011, an increase of $34,000, or 3%, from December 31, 2010, and a decrease of $712,000, or 38%, from March 31, 2010. The ratio of nonperforming assets, excluding Covered Assets, to total assets was 0.19% at March 31, 2011 and December 31, 2010, compared to 0.32% at March 31, 2010.

The Company recorded net charge-offs of $3,000 during the first quarter of 2011, compared to net charge-offs of $151,000 in the fourth quarter of 2010 and $21,000 in the first quarter of 2010. The Company’s loan loss provision for the first quarter of 2011 was $102,000, compared to $147,000 and $350,000 for the fourth quarter of 2010 and the first quarter of 2010, respectively.

At March 31, 2011, the Company’s ratio of allowance for loan losses to total Noncovered Loans was 1.10%, compared to 1.09% and 1.08% at December 31, 2010 and March 31, 2010, respectively.

Investment Securities Portfolio

Due to more favorable market pricing, the Company sold $3.6 million of its non-agency mortgage-backed securities portfolio during the first quarter of 2011. The sale of these securities, which included the below-investment-grade securities held by the Company, resulted in a $166,000 pre-tax net loss. The remaining portfolio of non-agency mortgage-backed securities, which had an amortized cost of $16.5 million at March 31, 2011, are all rated AAA or Aaa by Standard & Poor’s or Moody’s.

The Company’s investment securities portfolio totaled $141.7 million at March 31, 2011, an increase of $14.5 million, or 11%, from December 31, 2010, and an increase of $3.5 million, or 3%, from March 31, 2010. At March 31, 2011, the Company had a net unrealized gain position on its investment securities portfolio of $1.6 million, compared to a net unrealized gain of $1.0 million and a net unrealized loss of $191,000 at December 31, 2010 and March 31, 2010, respectively.


Deposits

Core deposits (i.e., checking, savings and money market accounts) increased for the seventh consecutive quarter, posting growth of $12.0 million, or 4%, during the first three months of 2011. Total deposits were $543.6 million at March 31, 2011, a decrease of $9.6 million, or 2%, from December 31, 2010, and an increase of $3.7 million, or 1%, from March 31, 2010.

The following table sets forth the composition of the Company’s deposits at the dates indicated.

 

     March 31,      December 31,      Increase / (Decrease)  

(dollars in thousands)

   2011      2010      Amount     Percent  

Demand deposit

   $ 102,335       $ 100,579       $ 1,756        2

Savings

     31,264         29,258         2,006        7   

Money market

     143,088         133,245         9,843        7   

NOW

     66,757         68,398         (1,641     (2

Certificates of deposit

     200,175         221,738         (21,563     (10
                                  

Total deposits

   $ 543,619       $ 553,218       $ (9,599     (2 )% 
                                  

Net Interest Income

Net interest income for the first quarter of 2011 totaled $6.9 million, a decrease of $265,000, or 4%, compared to the fourth quarter of 2010, and an increase of $1.0 million, or 17%, compared to the first quarter of 2010. The Company’s net interest margin was 4.67% for the first quarter of 2011, three basis points lower than the fourth quarter of 2010 and two basis points lower than the first quarter of 2010.

The following table sets forth the Company’s average volume and rate of its interest-earning assets and interest-bearing liabilities for the periods indicated.

 

     For the Three Months Ended  
     March 31, 2011     December 31, 2010     March 31, 2010  

(dollars in thousands)

   Average
Balance
     Average
Yield/Rate
    Average
Balance
     Average
Yield/Rate
    Average
Balance
     Average
Yield/Rate
 

Earning-assets:

               

Loans receivable

   $ 439,490         6.59   $ 448,172         6.61   $ 360,963         6.61

Investment securities

     130,607         2.94        124,561         3.39        123,183         4.30   

Other interest-earning assets

     24,423         0.61        32,045         0.47        20,049         0.55   
                                 

Total earning-assets

   $ 594,520         5.55      $ 604,778         5.62      $ 504,195         5.81   
                                 

Interest-bearing liabilities:

               

Deposits:

               

Savings, checking, and money market

   $ 233,440         0.53      $ 220,556         0.56      $ 153,003         0.72   

Certificates of deposit

     209,734         1.69        228,848         1.70        181,861         2.15   
                                 

Total interest-bearing deposits

     443,174         1.08        449,404         1.14        334,864         1.50   

FHLB advances

     15,280         2.64        14,027         3.17        17,897         3.53   
                                 

Total interest-bearing liabilities

   $ 458,454         1.13      $ 463,431         1.20      $ 352,761         1.60   
                                 

Net interest spread

        4.42        4.42        4.21

Net interest margin

        4.67        4.70        4.69


Noninterest Income

Noninterest income for the first quarter of 2011 totaled $1.2 million, a decrease of $232,000, or 16%, compared to the fourth quarter of 2010 and an increase of $246,000, or 25%, compared to the first quarter of 2010.

The decrease in noninterest income in the first quarter of 2011 compared to the fourth quarter of 2010 resulted primarily from lower gains on the sale of mortgage loans and a net loss on the sale of a sizeable portion of the Company’s non-agency mortgage-backed securities portfolio. The sale of securities, which included the Company’s holdings of below-investment-grade securities, resulted in a $166,000 pre-tax net loss.

The increase in noninterest income in the first quarter of 2011 compared to the first quarter of 2010 resulted primarily from higher levels of bank card fees and the discount accretion of the FDIC loss sharing receivable associated with the acquisition of Statewide Bank late in the first quarter of 2010. The increase in bank card fees was primarily the result of the addition of accounts through the Statewide acquisition.

Subsequent to the end of the first quarter of 2011, the Company entered into a settlement agreement with respect to litigation brought by the Company against a counterparty for losses reported by the Company in 2008 relating to the Company’s former business line of providing cash to third-party ATM providers. Under the terms of the settlement agreement, the Company received $525,000 in April 2011 and has foregone its right to pursue future claims related to any unrecovered loss. The $525,000 will be reported as noninterest income in the second quarter of 2011. The Company ceased providing cash to third-party ATM providers in 2009.

Noninterest Expense

Noninterest expense for the first quarter of 2011 totaled $6.7 million, an increase of $459,000, or 7%, compared to the fourth quarter of 2010 and an increase of $1.5 million, or 28%, compared the first quarter of 2010.

The increase in noninterest expense in the first quarter of 2011 compared to the fourth quarter of 2010 resulted primarily from an increase in franchise and shares taxes, compensation and benefits expense and $191,000 of merger-related expenses. These increases were partially offset by a $101,000 decrease in repossessed asset expenses (reported in other noninterest expenses).

The increase in noninterest expense in the first quarter of 2011 compared to the first quarter of 2010 was primarily due to higher compensation and benefits, occupancy and data processing and communications expenses related to the Statewide Bank acquisition and the addition of our Baton Rouge headquarters location in mid-March 2010. Additionally, regulatory fees increased during the quarter ended March 31, 2011 compared to the same quarter a year ago as a result of an increase in base insurance premium assessments on deposits by the FDIC.

This news release contains certain forward-looking statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.”


Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors - many of which are beyond our control - could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Home Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2010, describes some of these factors, including risk elements in the loan portfolio, the level of the allowance for losses on loans, risks of our growth strategy, geographic concentration of our business, dependence on our management team, risks of market rates of interest and of regulation on our business and risks of competition. Forward-looking statements speak only as of the date they are made. We do not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made or to reflect the occurrence of unanticipated events.


HOME BANCORP, INC. AND SUBSIDIARY

CONDENSED STATEMENTS OF FINANCIAL CONDITION

 

     March 31,
2011
    March 31,
2010
    %
Change
    December 31,
2010
 

Assets

        

Cash and cash equivalents

   $ 22,466,923      $ 17,841,146        26   $ 36,970,638   

Interest-bearing deposits in banks

     8,857,000        5,652,000        57        7,867,000   

Investment securities available for sale, at fair value

     133,933,288        123,608,320        8        111,962,331   

Investment securities held to maturity

     7,764,023        14,628,588        (47     15,220,474   

Mortgage loans held for sale

     560,991        2,411,700        (77     2,436,986   

Loans covered by loss sharing agreements

     75,996,118        108,056,686        (30     80,446,859   

Noncovered loans, net of unearned income

     366,003,288        342,247,448        7        359,464,400   
                          

Total loans

     441,999,406        450,304,134        (2     439,911,259   

Allowance for loan losses

     (4,019,285     (3,680,819     9        (3,919,745
                          

Total loans, net of allowance for loan losses

     437,980,121        446,623,315        (2     435,991,514   
                          

FDIC loss sharing receivable

     31,030,272        34,422,039        (10     32,012,783   

Office properties and equipment, net

     23,216,809        17,386,998        34        23,371,915   

Cash surrender value of bank-owned life insurance

     16,338,064        15,710,189        4        16,192,645   

Accrued interest receivable and other assets

     18,327,587        18,455,796        (1     18,396,806   
                          

Total Assets

   $ 700,475,078      $ 696,740,091        1      $ 700,423,092   
                          

Liabilities

        

Deposits

   $ 543,619,256      $ 539,934,197        1   $ 553,217,853   

Federal Home Loan Bank advances

     21,000,000        19,259,424        9        13,000,000   

Accrued interest payable and other liabilities

     3,281,323        4,681,109        (30     2,675,297   
                          

Total Liabilities

     567,900,579        563,874,730        1        568,893,150   
                          

Shareholders’ Equity

        

Common stock

     89,270      $ 89,270        —     $ 89,270   

Additional paid-in capital

     89,183,147        88,424,553        1        88,818,862   

Treasury stock

     (11,028,575     (2,980,831     (270     (10,425,725

Common stock acquired by benefit plans

     (9,676,562     (10,824,200     11        (9,770,556

Retained earnings

     62,920,252        58,282,859        8        62,125,568   

Accumulated other comprehensive income (loss)

     1,086,967        (126,290     961        692,523   
                          

Total Shareholders’ Equity

     132,574,499        132,865,361        —          131,529,942   
                          

Total Liabilities and Shareholders’ Equity

   $ 700,475,078      $ 696,740,091        1      $ 700,423,092   
                          


HOME BANCORP, INC. AND SUBSIDIARY

CONDENSED STATEMENTS OF INCOME

 

     For The Three Months Ended      %
Change
    For The Three     %
Change
 
     March 31,        Months Ended    
     2011     2010        December 31, 2010    

Interest Income

           

Loans, including fees

   $ 7,160,653      $ 5,907,230         21   $ 7,456,346        (4 )% 

Investment securities

     960,821        1,323,218         (27     1,056,751        (9

Other investments and deposits

     36,721        27,323         34        37,895        (3
                             

Total interest income

     8,158,195        7,257,771         12        8,550,992        (5
                             

Interest Expense

           

Deposits

     1,177,048        1,236,197         (5 )%      1,294,223        (9 )% 

Federal Home Loan Bank advances

     100,640        157,659         (36     111,440        (10
                             

Total interest expense

     1,277,688        1,393,856         (8     1,405,663        (9
                             

Net interest income

     6,880,507        5,863,915         17        7,145,329        (4

Provision for loan losses

     102,276        350,032         (71     147,297        (31
                             

Net interest income after provision for loan losses

     6,778,231        5,513,883         23        6,998,032        (3
                             

Noninterest Income

           

Service fees and charges

     474,824        467,389         2     477,547        (1 )% 

Bank card fees

     398,094        283,057         41        405,685        (2

Gain on sale of loans, net

     104,393        78,393         33        337,435        (69

Income from bank-owned life insurance

     145,419        149,246         (3     158,496        (8

Other-than-temporary impairment of securities

     —          —           —          (218,266     100   

Gain (loss) on the sale of securities, net

     (166,082     —           —          10,374        (1,701

Discount accretion of FDIC loss sharing receivable

     238,669        —           —          236,895        1   

Other income

     48,036        19,535         146        66,968        (28
                             

Total noninterest income

     1,243,353        997,620         25        1,475,134        (16
                             

Noninterest Expense

           

Compensation and benefits

     3,998,408        3,012,137         33     3,797,201        5

Occupancy

     565,261        387,983         46        565,753        —     

Marketing and advertising

     161,050        201,737         (20     238,500        (32

Data processing and communication

     541,507        379,382         43        493,814        10   

Professional fees

     419,732        468,062         (10     188,737        122   

Franchise and shares tax

     180,500        201,071         (10     (40,515     546   

Regulatory fees

     229,739        110,904         107        228,244        1   

Other expenses

     632,378        485,207         30        798,210        (21
                             

Total noninterest expense

     6,728,575        5,246,483         28        6,269,944        7   
                             

Income before income tax expense

     1,293,009        1,265,020         2        2,203,222        (41

Income tax expense

     498,325        419,605         19        738,301        (33
                             

Net income

   $ 794,684      $ 845,415         (6 )%    $ 1,464,921        (46 )% 
                             

Earnings per share:

           

Basic

   $ 0.11      $ 0.11         —     $ 0.20        (45 )% 
                             

Diluted

   $ 0.11      $ 0.11         —        $ 0.20        (45
                             


HOME BANCORP, INC. AND SUBSIDIARY

SUMMARY FINANCIAL INFORMATION

 

     For The Three Months Ended           For The Three        
     March 31,     %     Months Ended     %  
     2011     2010     Change     December 31, 2010     Change  

AVERAGE BALANCE SHEET DATA

          

Total assets

   $ 692,755      $ 559,413        24   $ 698,683        (1 )% 

Total interest-earning assets

     594,520        504,195        18        604,779        (2

Loans

     439,490        360,963        22        448,172        (2

Interest-bearing deposits

     443,174        334,864        32        449,404        (1

Interest-bearing liabilities

     458,454        352,761        30        463,431        (1

Total deposits

     543,323        407,380        33        551,010        (1

Total shareholders’ equity

     131,994        129,618        2        131,802        —     

SELECTED RATIOS (1)

          

Return on average assets

     0.46     0.60     (23 )%      0.84     (45 )% 

Return on average equity

     2.41        2.61        (8     4.45        (46

Efficiency ratio (2)

     82.82        76.46        8        72.18        15   

Average equity to average assets

     19.05        23.17        (18     18.86        1   

Tier 1 leverage capital ratio (3)

     15.59        14.94        4        15.46        1   

Total risk-based capital ratio (3)

     24.86        21.32        17        23.65        5   

Net interest margin

     4.67        4.69        —          4.70        (1

PER SHARE DATA

          

Basic earnings per share

   $ 0.11      $ 0.11        —     $ 0.20        (45 )% 

Diluted earnings per share

     0.11        0.11        —          0.20        (45

Book value at period end

     16.39        15.30        7        16.18        1   

PER SHARE DATA

          

Shares outstanding at period end

     8,087,159        8,682,700        (7 )%      8,131,002        (1 )% 

Weighted average shares outstanding

          

Basic

     7,177,377        7,707,576        (7 )%      7,274,882        (1 )% 

Diluted

     7,277,013        7,789,451        (7     7,347,275        (1

 

(1) 

With the exception of end-of-period ratios, all ratios are based on average monthly balances during the respective periods and are annualized where appropriate.

(2) 

The efficiency ratio represents noninterest expense as a percentage of total revenues. Total revenues is the sum of net interest income and noninterest income.

(3) 

Capital ratios are end of period ratios for the Bank only.


HOME BANCORP, INC. AND SUBSIDIARY

SUMMARY CREDIT QUALITY INFORMATION

 

     March 31, 2011     March 31, 2010     December 31, 2010  
     Covered     Noncovered     Total     Covered     Noncovered     Total     Covered     Noncovered     Total  

(dollars in thousands)

                  

CREDIT QUALITY (1)

                  

Nonaccrual loans

   $ 15,479      $ 1,090      $ 16,569      $ 16,780      $ 1,473      $ 18,253      $ 15,988      $ 1,056      $ 17,044   

Accruing loans past due 90 days and over

     —          —          —          —          —          —          —          —          —     
                                                                        

Total nonperforming loans

     15,479        1,090        16,569        16,780        1,473        18,253        15,988        1,056        17,044   

Other real estate owned

     5,281        92        5,373        2,536        421        2,957        5,661        92        5,753   
                                                                        

Total nonperforming assets

     20,760        1,182        21,942        19,316        1,894        21,210        21,649        1,148        22,797   

Performing troubled debt restructurings

     —          1,067        1,067        —          762        762        —          721        721   
                                                                        

Total nonperforming assets and troubled debt restructurings

   $ 20,760      $ 2,249      $ 23,009      $ 19,316      $ 2,656      $ 21,972      $ 21,649      $ 1,869      $ 23,518   
                                                                        

Nonperforming assets to total assets (2)

       0.19         0.32         0.19  

Nonperforming loans to total assets (2)

       0.18            0.25            0.17     

Nonperforming loans to total loans (2)

       0.30            0.43            0.29     

Allowance for loan losses to nonperforming assets

       340.12            194.30            341.51     

Allowance for loan losses to nonperforming loans

       368.80            249.90            371.23     

Allowance for loan losses to total loans

       1.10            1.08            1.09     

Year-to-date loan charge-offs

   $ —        $ 9      $ 9      $ —        $ 28      $ 28      $ —        $ 369      $ 369   

Year-to-date loan recoveries

     —          6        6        —          7        7        —          72        72   
                                                                        

Year-to-date net loan charge-offs

   $ —        $ 3      $ 3      $ —        $ 21      $ 21      $ —        $ 297      $ 297   
                                                                        

Annualized YTD net loan charge-offs to total loans

     —       —       —       —       0.02     0.02     —       0.08     0.07

 

(1) 

Nonperforming loans consist of nonaccruing loans and loans 90 days or more past due. Nonperforming assets consist of nonperforming loans and repossessed assets. It is our policy to cease accruing interest on loans 90 days or more past due. Repossessed assets consist of assets acquired through foreclosure or acceptance of title in-lieu of foreclosure.

(2) 

Asset quality information excludes assets covered under FDIC loss sharing agreements.