Attached files
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| 8-K - TIMBERLAND BANCORP, INC. FORM 8-K - TIMBERLAND BANCORP INC | k863012.htm |
Exhibit 99.1
| Contact: | Michael R. Sand, |
| President & CEO | |
| Dean J. Brydon, CFO | |
| (360) 533-4747 | |
Timberland Bancorp Reports EPS of $0.16 for Fiscal Third Quarter 2012
Net Interest Margin Increases, Credit Quality Improves, Capital Ratios Remain Strong
HOQUIAM, WA – July 24, 2012- Timberland Bancorp, Inc. (NASDAQ: TSBK) (“Timberland” or “the Company”) today reported fiscal 2012 third quarter net income of $1.35 million. Net income available to common shareholders, after adjusting for the preferred stock dividend and the preferred stock discount accretion was $1.08 million, or $0.16 per diluted common share. This compares to net income to common shareholders of $541,000, or $ 0.08 per diluted common share, for the quarter ended March 31, 2012 and a net loss to common shareholders of $(1.55 million), or $(0.23) per diluted common share, for the quarter ended June 30, 2011.
Net income for the first nine months of fiscal 2012 of $3.44 million is a significant increase over the net income of $1.16 million recorded for the first nine months of fiscal 2011. Net income available to common shareholders for the first nine months of fiscal 2012 after the preferred stock dividends and the preferred stock discount accretion was $2.64 million, or $0.39 per diluted common share, compared to $370,000, or $0.05 per diluted common share, in the like period one year ago.
“The continuation of a low interest rate environment presents challenges to the banking industry, however we noted significant improvements in a number of operational metrics this quarter,” stated Michael R. Sand, President and CEO. “Net interest margin increased, credit costs declined, the efficiency ratio improved and net income significantly increased compared to the prior quarter and fiscal year to date. Our employees continue to compete effectively in an extremely competitive environment which shows little near term signs of abating. Demand for portfolio loans remains less than robust although the market for one- to four-family refinance mortgage loans continues to be strong.”
Fiscal Third Quarter 2012 Highlights (at or for the period ended June 30, 2012, compared to March 31, 2012, or June 30, 2011):
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Net income increased to $1.35 million compared to $808,000 for the preceding quarter and a net loss of $(1.28 million) for the comparable quarter one year ago ;
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Earnings per diluted common share increased to $0.16 from $0.08 for the preceding quarter and from a loss of $(0.23) for the comparable quarter one year ago;
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Net interest margin increased to 3.96% compared to 3.72% for the preceding quarter and 3.76% for the comparable quarter one year ago;
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Total delinquent and non-accrual loans decreased 21% during the quarter and 23% year-over-year;
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The non-performing asset ratio improved to 5.14%;
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Efficiency ratio improved to 67.98% compared to 74.97% for the preceding quarter and 82.98% for the comparable quarter one year ago;
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Capital levels remain very strong: Total Risk Based Capital of 16.85%; Tier 1 Leverage Capital Ratio of 11.59%; Tangible Capital to Tangible Assets Ratio of 11.52%; and
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Book value per common share increased to $10.38, and tangible book value per common share increased to $9.53 at quarter end.
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Capital Ratios and Asset Quality
Timberland Bancorp remains very well capitalized with a total risk-based capital ratio of 16.85%, a Tier 1 leverage capital ratio of 11.59% and a tangible capital to tangible assets ratio of 11.52% at June 30, 2012. On May 21, 2012 Timberland received approval and paid $1.0 million in dividends on the preferred shares issued to the U.S. Treasury in December 2008. On July 16, 2012 Timberland requested permission from the Federal Reserve to pay the remaining accrued dividends of $1.19 million to
Timberland Q3 Earnings
July 24, 2012
Page 2
the U.S. Treasury and is currently awaiting a response. The payment of such dividends does not reduce Timberland’s reported capital ratios since appropriate accruals for the dividends were recorded in the current and prior quarters.
Timberland provisioned $900,000 to its loan loss allowance during the quarter ended June 30, 2012 compared to $1.05 million in the preceding quarter and $3.40 million in the comparable quarter one year ago. Net charge-offs for the quarter totaled $1.56 million, of which $1.08 million had been previously classified as impairments and specifically reserved for in previous quarters.
Total delinquent loans (past due 30 days or more) and non-accrual loans decreased 21% to $34.7 million at June 30, 2012 from $44.0 million at March 31, 2012 and decreased 23% from $45.0 million one year ago. The non-performing assets to total assets ratio was 5.14% at June 30, 2012 compared to 5.40% three months earlier and 5.53% one year ago.
Non-accrual loans totaled $24.0 million at June 30, 2012 and were comprised of 57 loans and 50 credit relationships. By category: 41% of non-accrual loans are secured by land and land development properties; 38% are secured by commercial properties; 18% are secured by residential properties; and 3% are secured by residential construction projects.
Other real estate owned (“OREO”) and other repossessed assets increased by $2.0 million to $10.0 million at June 30, 2012 from $8.0 million at March 31, 2012 and decreased from $11.0 million at June 30, 2011. The conversion of non-performing loans to OREO moves the assets closer to final resolution. The OREO portfolio consisted of 56 individual properties and two other repossessed assets at June 30, 2012. The properties consisted of 38 land parcels totaling $5.2 million, 12 single family homes totaling $1.5 million, five commercial real estate properties totaling $2.4 million and a condominium project of $842,000. The two other repossessed assets totaled $44,000. During the quarter ended June 30, 2012, nine OREO properties and other repossessed assets totaling $739,000 were sold for a net gain of $34,000.
Balance Sheet Management
Total assets decreased by $13.6 million, or 2%, to $729.1 million at June 30, 2012 from $742.7 million at March 31, 2012. The decrease in total assets was primarily due to a $14.2 million decrease in total deposits which reduced the amount of assets held in overnight funds and contributed to an increased net interest margin.
Liquidity as measured by cash and cash equivalents, CDs held for investment and available for sale investments was 18.9% of total liabilities at June 30, 2012 compared to 20.9% at March 31, 2012 and 21.6% one year ago.
Net loans receivable increased $2.2 million to $537.2 million at June 30, 2012 from $535.0 million at March 31, 2012. The increase was primarily due to a $7.4 million increase multi-family loan balances, a $4.1 million increase in one-to four-family loan balances and $3.2 million increase in commercial real estate loan balances. These increases to net loans receivable were partially offset by an $8.4 million decrease in construction and land development loan balances, a $3.3 million decrease in land loan balances and an $829,000 decrease in commercial business loan balances.
Timberland continued to reduce its exposure to land development and land loans during the quarter. Land development loan balances decreased to $609,000 at June 30, 2012, a 38% decrease from the preceding quarter and a 76% decrease year-over-year. The Bank’s land loan portfolio decreased to $41.3 million at June 30, 2012, a 7% decrease from the preceding quarter and an 18% decrease year-over-year. The well diversified land loan portfolio consists of 331 loans on a variety of land types including individual building lots, acreage, raw land and commercially zoned properties. The average loan balance for the entire land portfolio was approximately $125,000 at June 30, 2012.
Timberland Q3 Earnings
July 24, 2012
Page 3
LOAN PORTFOLIO
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June 30, 2012
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March 31, 2012
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June 30, 2011
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($ in thousands)
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Amount
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Percent
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Amount
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Percent
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Amount
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Percent
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||||||||||||||||||
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Mortgage Loans:
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One-to four-family
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$ | 109,624 | 19 | % | $ | 105,570 | 19 | % | $ | 112,838 | 20 | % | ||||||||||||
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Multi-family
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38,146 | 7 | 30,745 | 5 | 31,058 | 6 | ||||||||||||||||||
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Commercial
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258,545 | 46 | 255,327 | 46 | 229,800 | 41 | ||||||||||||||||||
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Construction and land
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Development
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48,639 | 9 | 57,069 | 10 | 68,017 | 12 | ||||||||||||||||||
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Land
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41,273 | 7 | 44,553 | 8 | 50,238 | 9 | ||||||||||||||||||
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Total mortgage loans
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496,227 | 88 | 493,264 | 88 | 491,951 | 88 | ||||||||||||||||||
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Consumer Loans:
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Home equity and second
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Mortgage
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34,080 | 6 | 33,979 | 6 | 36,991 | 7 | ||||||||||||||||||
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Other
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6,413 | 1 | 6,234 | 1 | 8,226 | 1 | ||||||||||||||||||
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Total consumer loans
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40,493 | 7 | 40,213 | 7 | 45,217 | 8 | ||||||||||||||||||
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Commercial business loans
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26,052 | 5 | 26,881 | 5 | 20,621 | 4 | ||||||||||||||||||
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Total loans
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562,772 | 100 | % | 560,358 | 100 | % | 557,789 | 100 | % | |||||||||||||||
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Less:
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Undisbursed portion of
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construction loans in
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Process
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(12,239 | ) | (11,245 | ) | (22,713 | ) | ||||||||||||||||||
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Deferred loan origination
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Fees
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(1,761 | ) | (1,856 | ) | (1,988 | ) | ||||||||||||||||||
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Allowance for loan losses
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(11,603 | ) | (12,264 | ) | (11,790 | ) | ||||||||||||||||||
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Total loans receivable, net
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$ | 537,169 | $ | 534,993 | $ | 521,298 | ||||||||||||||||||
CONSTRUCTION LOAN COMPOSITION
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June 30, 2012
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March 31, 2012
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June 30, 2011
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($ in thousands)
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Amount
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Percent
of Loan
Portfolio
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Amount
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Percent
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Amount
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Percent
of Loan
Portfolio
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Custom and owner / builder
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$ | 27,643 | 5 | % | $ | 28,109 | 5 | % | $ | 28,128 | 5 | % | ||||||||||||
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Speculative one- to four-
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Family
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2,122 | 1 | 2,271 | 1 | 3,028 | 1 | ||||||||||||||||||
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Commercial real estate
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17,920 | 3 | 17,079 | 3 | 26,081 | 4 | ||||||||||||||||||
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Multi-family (including
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condominium)
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345 | -- | 8,632 | 1 | 8,254 | 1 | ||||||||||||||||||
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Land development
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609 | -- | 978 | -- | 2,526 | 1 | ||||||||||||||||||
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Total construction loans
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$ | 48,639 | 9 | % | $ | 57,069 | 10 | % | $ | 68,017 | 12 | % | ||||||||||||
Timberland’s loan originations increased 26% to $63.6 million during the quarter ended June 30, 2012 compared to $50.4 million for the preceding quarter and increased 78% from the $35.7 million originated during the quarter one year ago. Timberland continues to sell fixed rate one-to-four family mortgage loans into the secondary market for asset–liability management purposes and to generate non-interest income. During the quarter ended June 30, 2012, $21.2 million fixed-rate
Timberland Q3 Earnings
July 24, 2012
Page 4
one-to four-family mortgage loans were sold compared to $23.9 million for the preceding quarter and $8.2 million for the like quarter ended one year ago.
Timberland’s mortgage-backed securities (“MBS”) and other investments decreased by $351,000 during the quarter to $8.6 million at June 30, 2012 from $9.0 million at March 31, 2012, primarily due to prepayments and scheduled amortization. During the quarter ended June 30, 2012, other-than-temporary-impairment (“OTTI”) credit related write-downs and realized losses of $37,000 were recorded on the private label MBS that were acquired in the in-kind redemption from the AMF family of mutual funds in June 2008. At June 30, 2012 the Bank’s remaining private label MBS portfolio had been reduced to $2.9 million from an original acquired balance of $15.3 million.
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DEPOSIT BREAKDOWN
($ in thousands)
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June 30, 2012
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March 31, 2012
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June 30, 2011
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Amount
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Percent
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Amount
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Percent
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Amount
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Percent
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Non-interest bearing
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$ | 70,004 | 12 | % | $ | 69,633 | 12 | % | $ | 57,735 | 10 | % | ||||||||||||
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N.O.W. checking
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149,821 | 25 | 158,635 | 26 | 158,725 | 27 | ||||||||||||||||||
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Savings
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88,210 | 15 | 89,676 | 15 | 77,391 | 13 | ||||||||||||||||||
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Money market
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73,857 | 13 | 69,345 | 11 | 56,151 | 9 | ||||||||||||||||||
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Certificates of deposit under $100
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130,233 | 22 | 135,538 | 22 | 146,037 | 25 | ||||||||||||||||||
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Certificates of deposit $100 and over
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78,241 | 13 | 81,769 | 14 | 93,459 | 16 | ||||||||||||||||||
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Certificates of deposit – brokered
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- - | -- | - - | -- | -- | -- | ||||||||||||||||||
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Total deposits
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$ | 590,366 | 100 | % | $ | 604,596 | 100 | % | $ | 589,498 | 100 | % | ||||||||||||
Total deposits decreased 2% to $590.4 million at June 30, 2012, from $604.6 million at March 31, 2012 primarily as a result of an $8.8 million decrease in certificates of deposit account balances, an $8.8 million decrease in N.O.W. checking account balances and a $1.5 million decrease in savings account balances. These decreases were partially offset by a $4.5 million increase in money market account balances and a $371,000 increase in non-interest bearing account balances.
Total shareholders’ equity increased $1.30 million to $89.28 million at June 30, 2012, from $87.98 million at March 31, 2012. The increase in shareholders’ equity was primarily a result of net income for the quarter. Book value per common share increased to $10.38 and tangible book value per common share increased to $9.53 at June 30, 2012.
Operating Results
Fiscal third quarter operating revenue (net interest income before provision for loan losses, plus non-interest income excluding OTTI charges and valuation allowances or recoveries on mortgage servicing rights (“MSRs”)), increased 4% to $9.09 million from $8.72 million for the preceding quarter and 7% from the $8.48 million for the comparable quarter one year ago.
Net interest income increased 6% to $6.63 million for the quarter ended June 30, 2012 from $6.27 million for the preceding quarter and increased 3% from $6.41 million for the comparable quarter one year ago. The net interest margin for the current quarter increased to 3.96% from 3.72% for the preceding quarter and from 3.76% for the comparable quarter one year ago. The increase in net interest income and net interest margin was primarily a result of an increase in average loans outstanding, a decrease in non-accrual loans and an in increase in late fees received and deferred loan origination fees taken into income on loans that paid off during the current quarter. Average loans outstanding increased by $7.6 million to $548.5 million (81.9% of average total interest earning assets) for the quarter ended June 30, 2012 from $540.9 million (80.2% of average total interest earning assets) for the quarter ended March 31, 2012. Late fees and deferred loan origination fees taken into income (and classified as interest income) on loans that paid off during the quarter ended June 30, 2012 increased $129,000 relative to the total recorded for the quarter ended March 31, 2012. The increase in late fees and loan origination fees increased the net interest margin by approximately eight basis points. For the first nine months of fiscal 2012, net interest income increased 1% to $19.20 million from $19.10 million for the first nine months of fiscal 2011. Timberland’s net interest margin for the first net months of fiscal 2012 increased to 3.80% from 3.78% for the first nine months of 2011.
Timberland provisioned $900,000 to its loan loss allowance for the quarter ended June 30, 2012, compared to $1.05 million in the preceding quarter and $3.40 million in the comparable quarter one year prior. For the first nine months of fiscal 2012, the
Timberland Q3 Earnings
July 24, 2012
Page 5
provision for loan losses totaled $2.6 million compared to $5.0 million in the first nine months of fiscal 2011. Net charge-offs for the quarter ended June 30, 2012 totaled $1.56 million compared to $758,000 for the quarter ended March 31, 2011 and $3.41 million for the quarter one year ago. Fiscal year-to-date, net charge-offs were $2.94 million compared to $4.47 million for the first nine months of fiscal 2011.
Non-interest income decreased 6% to $2.34 million for the quarter ended June 30, 2012, from $2.49 million in the preceding quarter and increased 33% from $1.76 million for the comparable quarter one year ago. The decrease in non-interest income compared to the preceding quarter was primarily due to a $224,000 net decrease in the valuation recovery of the Bank’s MSRs, which was partially offset by an increase in service charges on deposits. Year to date, non-interest income increased $458,000, or 7%, to $7.28 million from $6.82 million for the first nine months of fiscal 2011, primarily due to an increase in gain on sale of loans and an increase in ATM and debit card interchange fee income.
Total operating (non-interest) expenses decreased 7% to $6.10 million for the third fiscal quarter from $6.57 million for the preceding quarter and 10% from $6.78 million for the comparable quarter one year ago. The decreased expenses for the current quarter compared to the preceding quarter were primarily the result of a $290,000 decrease in loan administration and foreclosure expenses and a $71,000 decrease in OREO and other repossessed assets expense. Year to date, operating expenses decreased 2% to $18.89 million from $19.34 million for the first nine months of fiscal 2011, primarily due to decreased salaries and employee benefits expense and decreased FDIC insurance expense, which were partially offset by increased OREO and other repossessed assets expense.
About Timberland Bancorp, Inc.
Timberland Bancorp, Inc., a Washington corporation, is the holding company for Timberland Bank (“Bank”). The Bank opened for business in 1915 and serves consumers and businesses across Grays Harbor, Thurston, Pierce, King, Kitsap and Lewis counties, Washington with a full range of lending and deposit services through its 22 branches (including its main office in Hoquiam).
Disclaimer
Certain matters discussed in this press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact and often include the words “believes,” “expects,” “anticipates,” “estimates,” “forecasts,” “intends,” “plans,” “targets,” “potentially,” “probably,” “projects,” “outlook” or similar expressions or future or conditional verbs such as “may,” “will,” “should,” “would” and “could.” Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, assumptions and statements about future performance. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause our actual results to differ materially from the results anticipated, including, but not limited to: the credit risks of lending activities, including changes in the level and trend of loan delinquencies and write-offs and changes in our allowance for loan losses and provision for loan losses that may be impacted by deterioration in the housing and commercial real estate markets and may lead to increased losses and non-performing assets in our loan portfolio, and may result in our allowance for loan losses not being adequate to cover actual losses, and require us to materially increase our reserves; changes in general economic conditions, either nationally or in our market areas; changes in the levels of general interest rates, and the relative differences between short and long term interest rates, deposit interest rates, our net interest margin and funding sources; fluctuations in the demand for loans, the number of unsold homes, land and other properties and fluctuations in real estate values in our market areas; secondary market conditions for loans and our ability to sell loans in the secondary market; results of examinations of us by the Federal Reserve and our bank subsidiary by the Federal Deposit Insurance Corporation, the Washington State Department of Financial Institutions, Division of Banks or other regulatory authorities, including the possibility that any such regulatory authority may, among other things, require us to increase our allowance for loan losses, write-down assets, change our regulatory capital position or affect our ability to borrow funds or maintain or increase deposits, which could adversely affect our liquidity and earnings; our compliance with regulatory enforcement actions, including regulatory memoranda of understandings (“MOUs”) to which we are subject; legislative or regulatory changes that adversely affect our business including changes in regulatory policies and principles, or the interpretation of regulatory capital or other rules; our ability to attract and retain deposits; further increases in premiums for deposit insurance; our ability to control operating costs and expenses; the use of estimates in determining fair value of certain of our assets, which estimates may prove to be incorrect and result in significant declines in valuation; difficulties in reducing risk associated with the loans on our balance sheet; staffing fluctuations in response to product demand or the implementation of corporate strategies that affect our workforce and potential associated charges; computer systems on which we depend could fail or experience a security breach; our ability to retain key members of our senior management team; costs and effects of litigation, including settlements and judgments; our ability to successfully integrate any assets, liabilities, customers, systems, and management personnel we may in the future acquire into our operations and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto; our ability to manage loan delinquency rates; increased competitive pressures among financial services companies; changes in consumer spending, borrowing and savings habits; legislative or regulatory changes that adversely affect our business including changes in regulatory policies and principles, the interpretation of regulatory capital or other rules and any changes in the rules applicable to institutions participating in the TARP Capital Purchase Program; the availability of resources to address changes in laws, rules, or regulations or to respond to regulatory actions; adverse changes in the securities markets; inability of key third-party providers to perform their obligations to us; changes in accounting policies and practices, as may be adopted by the financial institution regulatory agencies or the Financial Accounting Standards Board, including additional guidance and interpretation on accounting issues and details of the implementation of new accounting methods; the economic impact of war or any terrorist activities; other economic, competitive, governmental, regulatory, and technological factors affecting our operations; pricing, products and services; and other risks detailed in our reports filed with the Securities and Exchange Commission.
Any of the forward-looking statements that we make in this press release and in the other public statements we make are based upon management’s beliefs and assumptions at the time they are made. We undertake no obligation to publicly update or revise any forward-looking statements included in this report or to update the reasons why actual results could differ from those contained in such statements, whether as a result of new information, future events or otherwise.
Timberland Q3 Earnings
July 24, 2012
Page 6
We caution readers not to place undue reliance on any forward-looking statements. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. These risks could cause our actual results for fiscal 2012 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of us, and could negatively affect the Company’s operations and stock price performance.
Timberland Q3 Earnings
July 24, 2012
Page 7
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TIMBERLAND BANCORP INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
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Three Months Ended
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June 30,
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March 31,
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June 30,
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2012
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2012
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2011
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Interest and dividend income
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Loans receivable
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$ | 7,842 | $ | 7,607 | $ | 8,192 | |||||||
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MBS and other investments
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89 | 109 | 141 | ||||||||||
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Dividends from mutual funds
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6 | 7 | 8 | ||||||||||
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Interest bearing deposits in banks
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82 | 81 | 90 | ||||||||||
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Total interest and dividend income
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8,019 | 7,804 | 8,431 | ||||||||||
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Interest expense
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Deposits
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925 | 1,035 | 1,463 | ||||||||||
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FHLB advances and other borrowings
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466 | 496 | 556 | ||||||||||
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Total interest expense
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1,391 | 1,531 | 2,019 | ||||||||||
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Net interest income
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6,628 | 6,273 | 6,412 | ||||||||||
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Provision for loan losses
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900 | 1,050 | 3,400 | ||||||||||
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Net interest income after provision for loan losses
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5,728 | 5,223 | 3,012 | ||||||||||
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Non-interest income
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OTTI and realized losses on MBS
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and other investments, net
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(37 | ) | (94 | ) | (165 | ) | |||||||
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Gain on sale of MBS and other investments
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2 | 20 | -- | ||||||||||
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Service charges on deposits
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955 | 890 | 993 | ||||||||||
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Gain on sale of loans, net
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567 | 596 | 247 | ||||||||||
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Bank owned life insurance (“BOLI”) net earnings
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146 | 154 | 121 | ||||||||||
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Valuation recovery (allowance) on MSRs
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(82 | ) | 142 | (137 | ) | ||||||||
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ATM and debit card interchange transaction fees
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564 | 540 | 515 | ||||||||||
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Other
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226 | 245 | 187 | ||||||||||
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Total non-interest income, net
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2,341 | 2,493 | 1,761 | ||||||||||
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Non-interest expense
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Salaries and employee benefits
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3,006 | 3,055 | 3,150 | ||||||||||
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Premises and equipment
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647 | 682 | 640 | ||||||||||
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Advertising
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173 | 172 | 235 | ||||||||||
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OREO and other repossessed assets expense, net
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363 | 434 | 496 | ||||||||||
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ATM
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206 | 197 | 203 | ||||||||||
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Postage and courier
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124 | 139 | 139 | ||||||||||
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Amortization of core deposit intangible (“CDI”)
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37 | 37 | 42 | ||||||||||
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State and local taxes
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159 | 152 | 155 | ||||||||||
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Professional fees
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217 | 232 | 190 | ||||||||||
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FDIC insurance
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237 | 241 | 248 | ||||||||||
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Other insurance
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51 | 53 | 56 | ||||||||||
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Loan administration and foreclosure
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82 | 372 | 345 | ||||||||||
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Data processing and telecommunications
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303 | 315 | 285 | ||||||||||
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Deposit operations
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177 | 193 | 202 | ||||||||||
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Other
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315 | 298 | 396 | ||||||||||
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Total non-interest expense
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6,097 | 6,572 | 6,782 | ||||||||||
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(Table continued on following page)
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Timberland Q3 Earnings
July 24, 2012
Page 8
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Three Months Ended
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June 30,
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March 31,
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June 30,
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| 2012 | 2012 | 2011 | |||||||||||
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Income (loss) before income taxes
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$ | 1,972 | $ | 1,144 | $ | (2,009 | ) | ||||||
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Provision (benefit) for income taxes
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624 | 336 | (729 | ) | |||||||||
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Net income (loss)
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1,348 | 808 | (1,280 | ) | |||||||||
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Preferred stock dividends
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(208 | ) | (208 | ) | (208 | ) | |||||||
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Preferred stock discount accretion
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(61 | ) | (59 | ) | (57 | ) | |||||||
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Net income (loss) to common shareholders
|
$ | 1,079 | $ | 541 | $ | (1,545 | ) | ||||||
|
Net income (loss) per common share:
|
|||||||||||||
|
Basic
|
$ | 0.16 | $ | 0.08 | $ | (0.23 | ) | ||||||
|
Diluted
|
0.16 | 0.08 | (0.23 | ) | |||||||||
|
Weighted average common shares outstanding:
|
|||||||||||||
|
Basic
|
6,780,516 | 6,780,516 | 6,745,250 | ||||||||||
|
Diluted
|
6,780,516 | 6,780,516 | 6,745,250 | ||||||||||
Timberland Q3 Earnings
July 24, 2012
Page 9
|
TIMBERLAND BANCORP INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
|
Nine Months Ended
|
||||||||
| ($ in thousands, except per share amounts) |
June 30,
|
June 30,
|
|||||||
| (unaudited) |
2012
|
2011
|
|||||||
|
Interest and dividend income
|
|||||||||
|
Loans receivable
|
$ | 23,254 | $ | 24,966 | |||||
|
MBS and other investments
|
323 | 486 | |||||||
|
Dividends from mutual funds
|
26 | 23 | |||||||
|
Interest bearing deposits in banks
|
252 | 260 | |||||||
|
Total interest and dividend income
|
23,855 | 25,735 | |||||||
|
Interest expense
|
|||||||||
|
Deposits
|
3,128 | 4,805 | |||||||
|
FHLB advances and other borrowings
|
1,525 | 1,835 | |||||||
|
Total interest expense
|
4,653 | 6,640 | |||||||
|
Net interest income
|
19,202 | 19,095 | |||||||
|
Provision for loan losses
|
2,600 | 5,000 | |||||||
|
Net interest income after provision for loan losses
|
16,602 | 14,095 | |||||||
|
Non-interest income
|
|||||||||
|
OTTI and realized losses on MBS
|
|||||||||
|
and other investments, net
|
(190 | ) | (338 | ) | |||||
|
Gain on sale of MBS and other investments
|
22 | 79 | |||||||
|
Service charges on deposits
|
2,815 | 2,875 | |||||||
|
Gain on sale of loans, net
|
1,722 | 1,214 | |||||||
|
BOLI net earnings
|
457 | 361 | |||||||
|
Valuation recovery on MSRs
|
144 | 703 | |||||||
|
ATM and debit card interchange transaction fees
|
1,621 | 1,384 | |||||||
|
Other
|
687 | 542 | |||||||
|
Total non-interest income, net
|
7,278 | 6,820 | |||||||
|
Non-interest expense
|
|||||||||
|
Salaries and employee benefits
|
8,989 | 9,393 | |||||||
|
Premises and equipment
|
1,979 | 1,967 | |||||||
|
Advertising
|
553 | 604 | |||||||
|
OREO and other repossessed assets expense, net
|
1,299 | 930 | |||||||
|
ATM
|
598 | 583 | |||||||
|
Postage and courier
|
381 | 400 | |||||||
|
Amortization of CDI
|
111 | 125 | |||||||
|
State and local taxes
|
460 | 475 | |||||||
|
Professional fees
|
628 | 567 | |||||||
|
FDIC insurance
|
703 | 919 | |||||||
|
Other insurance
|
161 | 299 | |||||||
|
Loan administration and foreclosure
|
615 | 711 | |||||||
|
Data processing and telecommunications
|
918 | 847 | |||||||
|
Deposit operations
|
593 | 447 | |||||||
|
Other
|
903 | 1,069 | |||||||
|
Total non-interest expense
|
18,891 | 19,336 | |||||||
|
(Table continued on following page)
|
|||||||||
Timberland Q3 Earnings
July 24, 2012
Page 10
|
Nine Months Ended
|
|||||||||
|
June 30,
|
June 30,
|
||||||||
| 2012 | 2011 | ||||||||
|
Income before income taxes
|
$ | 4,989 | $ | 1,579 | |||||
|
Provision for income taxes
|
1,551 | 417 | |||||||
|
Net income
|
3,438 | 1,162 | |||||||
|
Preferred stock dividends
|
(624 | ) | (624 | ) | |||||
|
Preferred stock discount accretion
|
(179 | ) | (168 | ) | |||||
|
Net income to common shareholders
|
$ | 2,635 | $ | 370 | |||||
|
Net income per common share:
|
|||||||||
|
Basic
|
$ | 0.39 | $ | 0.05 | |||||
|
Diluted
|
0.39 | 0.05 | |||||||
|
Weighted average common shares outstanding:
|
|||||||||
|
Basic
|
6,780,516 | 6,745,250 | |||||||
|
Diluted
|
6,780,516 | 6,745,250 | |||||||
Timberland Q3 Earnings
July 24, 2012
Page 11
|
TIMBERLAND BANCORP INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
|
||||||||||||
|
($ in thousands, except per share amounts) (unaudited)
|
June 30,
|
March 31,
|
June 30,
|
|||||||||
|
2012
|
2012
|
2011
|
||||||||||
|
Assets
|
||||||||||||
|
Cash and due from financial institutions
|
$ | 12,489 | $ | 11,154 | $ | 10,997 | ||||||
|
Interest-bearing deposits in banks
|
80,499 | 100,467 | 103,306 | |||||||||
|
Total cash and cash equivalents
|
92,988 | 111,621 | 114,303 | |||||||||
|
Certificates of deposit (“CDs”) held for investment, at cost
|
22,781 | 20,180 | 18,087 | |||||||||
|
MBS and other investments:
|
||||||||||||
|
Held to maturity, at amortized cost
|
3,503 | 3,706 | 4,283 | |||||||||
|
Available for sale, at fair value
|
5,113 | 5,261 | 7,679 | |||||||||
|
FHLB stock
|
5,705 | 5,705 | 5,705 | |||||||||
|
Loans receivable
|
544,708 | 545,961 | 532,322 | |||||||||
|
Loans held for sale
|
4,064 | 1,296 | 766 | |||||||||
|
Less: Allowance for loan losses
|
(11,603 | ) | (12,264 | ) | (11,790 | ) | ||||||
|
Net loans receivable
|
537,169 | 534,993 | 521,298 | |||||||||
|
Premises and equipment, net
|
17,723 | 17,640 | 16,981 | |||||||||
|
OREO and other repossessed assets, net
|
9,997 | 8,024 | 10,996 | |||||||||
|
BOLI
|
16,374 | 16,228 | 13,762 | |||||||||
|
Accrued interest receivable
|
2,161 | 2,369 | 2,527 | |||||||||
|
Goodwill
|
5,650 | 5,650 | 5,650 | |||||||||
|
Core deposit intangible
|
286 | 323 | 439 | |||||||||
|
Mortgage servicing rights, net
|
2,150 | 2,284 | 2,463 | |||||||||
|
Prepaid FDIC insurance assessment
|
1,415 | 1,643 | 2,335 | |||||||||
|
Other assets
|
6,121 | 7,082 | 8,510 | |||||||||
|
Total assets
|
$ | 729,136 | $ | 742,709 | $ | 735,018 | ||||||
|
Liabilities and shareholders’ equity
|
||||||||||||
|
Deposits: Non-interest-bearing demand
|
$ | 70,004 | $ | 69,633 | $ | 57,735 | ||||||
|
Deposits: Interest-bearing
|
520,362 | 534,963 | 531,763 | |||||||||
|
Total deposits
|
590,366 | 604,596 | 589,498 | |||||||||
|
FHLB advances
|
45,000 | 45,000 | 55,000 | |||||||||
|
Repurchase agreements
|
826 | 948 | 598 | |||||||||
|
Other liabilities and accrued expenses
|
3,669 | 4,181 | 3,588 | |||||||||
|
Total liabilities
|
639,861 | 654,725 | 648,684 | |||||||||
|
Shareholders’ equity
|
||||||||||||
|
Preferred stock, $.01 par value; 1,000,000 shares authorized;
16,641 shares, Series A, issued and outstanding
$1,000 per share liquidation value
|
16,168 | 16,107 | 15,932 | |||||||||
|
Common stock, $.01 par value; 50,000,000 shares authorized;
7,045,036 shares issued and outstanding
|
10,500 | 10,480 | 10,463 | |||||||||
|
Unearned shares- Employee Stock Ownership Plan
|
(1,785 | ) | (1,851 | ) | (2,049 | ) | ||||||
|
Retained earnings
|
64,905 | 63,826 | 62,609 | |||||||||
|
Accumulated other comprehensive loss
|
(513 | ) | (578 | ) | (621 | ) | ||||||
|
Total shareholders’ equity
|
89,275 | 87,984 | 86,334 | |||||||||
|
Total liabilities and shareholders’ equity
|
$ | 729,136 | $ | 742,709 | $ | 735,018 | ||||||
Timberland Q3 Earnings
July 24, 2012
Page 12
|
KEY FINANCIAL RATIOS AND DATA
|
Three Months Ended
|
||||||
|
($ in thousands, except per share amounts) (unaudited)
|
June 30,
|
March 31,
|
June 30,
|
||||
|
2012
|
2012
|
2011
|
|||||
|
PERFORMANCE RATIOS:
|
|||||||
|
Return (loss) on average assets (a)
|
0.74%
|
0.44%
|
(0.69)%
|
||||
|
Return (loss) on average equity (a)
|
6.09%
|
3.69%
|
(5.83)%
|
||||
|
Net interest margin (a)
|
3.96%
|
3.72%
|
3.76%
|
||||
|
Efficiency ratio
|
67.98%
|
74.97%
|
82.98%
|
||||
|
Nine Months Ended
|
|||||||
|
June 30,
|
June 30,
|
||||||
|
2012
|
2011
|
||||||
|
PERFORMANCE RATIOS:
|
|||||||
|
Return on average assets (a)
|
0.62% |
0.21%
|
|||||
|
Return on average equity (a)
|
5.24% |
1.79%
|
|||||
|
Net interest margin (a)
|
3.80%
|
3.78%
|
|||||
|
Efficiency ratio
|
71.34%
|
74.61% | |||||
|
June 30,
|
March 31,
|
June 30,
|
|||||
|
2012
|
2012
|
2011
|
|||||
|
ASSET QUALITY RATIOS AND DATA:
|
|||||||
|
Non-accrual loans
|
$24,018
|
$26,623
|
$21,545
|
||||
|
Loans past due 90 days and still accruing
|
945
|
2,967
|
4,893
|
||||
|
Non-performing investment securities
|
2,484
|
2,516
|
3,184
|
||||
|
OREO and other repossessed assets
|
9,997
|
8,024
|
10,996
|
||||
|
Total non-performing assets (b)
|
$37,444
|
$40,130
|
$40,618
|
||||
|
Non-performing assets to total assets (b)
|
5.14%
|
5.40%
|
5.53%
|
||||
|
Net charge-offs during quarter
|
$ 1,561
|
$ 758
|
$ 3,408
|
||||
|
Allowance for loan losses to non-accrual loans
|
48%
|
46%
|
55%
|
||||
|
Allowance for loan losses to loans receivable, net (c)
|
2.11%
|
2.24%
|
2.21%
|
||||
|
Troubled debt restructured loans on accrual status (d)
|
$14,579
|
$15,890
|
$ 20,783
|
||||
|
CAPITAL RATIOS:
|
|||||||
|
Tier 1 leverage capital
|
11.59%
|
11.42%
|
11.01%
|
||||
|
Tier 1 risk based capital
|
15.58%
|
15.27%
|
15.34%
|
||||
|
Total risk based capital
|
16.85%
|
16.54%
|
16.60%
|
||||
|
Tangible capital to tangible assets (e)
|
11.52%
|
11.13%
|
11.01%
|
||||
|
BOOK VALUES:
|
|||||||
|
Book value per common share
|
$ 10.38
|
$ 10.20
|
$ 9.99
|
||||
|
Tangible book value per common share (e)
|
9.53
|
9.35
|
9.13
|
||||
__________________________________________________
(a) Annualized
(b) Non-performing assets include non-accrual loans, loans past due 90 days and still accruing, non-performing investment securities and OREO and other repossessed assets. Troubled debt restructured loans on accrual status are not included.
(c) Includes loans held for sale and is before the allowance for loan losses.
(d) Does not include troubled debt restructured loans totaling $9,319, $7,097 and $4,956 reported as non-accrual loans at June 30, 2012, March 31, 2012 and June 30, 2011, respectively.
(e) Calculation subtracts goodwill and core deposit intangible from the equity component and from assets.
Timberland Q3 Earnings
July 24, 2012
Page 13
|
AVERAGE CONSOLIDATED BALANCE SHEETS:
|
Three Months Ended
|
|||||
|
($ in thousands) (unaudited)
|
June 30,
|
March 31,
|
June 30,
|
|||
|
2012
|
2012
|
2011
|
||||
|
Average total loans
|
$548,450
|
$540,858
|
$537,858
|
|||
|
Average total interest-bearing assets (a)
|
669,715
|
673,970
|
682,529
|
|||
|
Average total assets
|
733,243
|
732,882
|
743,207
|
|||
|
Average total interest-bearing deposits
|
524,249
|
529,707
|
535,873
|
|||
|
Average FHLB advances and other borrowings
|
45,818
|
45,967
|
55,509
|
|||
|
Average shareholders’ equity
|
88,535
|
87,587
|
87,797
|
|||
|
Nine Months Ended
|
||||||
|
June 30,
|
June 30,
|
|||||
|
2012
|
2011
|
|||||
|
Average total loans
|
$542,378
|
$537,782
|
||||
| Average total interest-bearing assets (a) | 673,049 |
672,772
|
||||
|
Average total assets
|
734,138 |
732,041
|
||||
|
Average total interest-bearing deposits
|
526,683
|
529,736
|
||||
|
Average FHLB advances and other borrowings
|
49,138
|
55,514 | ||||
|
Average shareholders’ equity
|
87,548
|
86,686 | ||||
_________________________________
(a) Includes loans and MBS on non-accrual status