Northeast Bancorp ("Northeast" or the "Company") (Nasdaq:NBN), a
Maine-based full-service financial services company and parent of
Northeast Bank (the "Bank"), today reported net income of $1.6
million, or $0.16 per diluted common share, for the quarter ended
December 31, 2014, compared to net income of $1.4 million, or $0.13
per diluted common share, for the quarter ended December 31, 2013.
Net income for the six months ended December 31, 2014 was $3.2
million, compared to $1.7 million for the six months ended December
31, 2013.
The Board of Directors has declared a cash dividend of $0.01 per
share, payable on February 26, 2015 to shareholders of record as of
February 12, 2015.
"We closed another productive quarter," said Richard Wayne,
President and Chief Executive Officer. "Total loans grew by 6%, on
the strength of 10% growth in our LASG loan book. Transactional
income of $2.8 million produced a 13.7% return on purchased loans,
contributing significantly to a 4.9% net interest margin for the
period. We made significant progress in building out our new SBA
lending initiative, hiring 7 new business development officers in
November. And, in our continuing effort to improve returns for
shareholders, we repurchased 434 thousand shares at an average
price of $9.14."
At December 31, 2014, total assets were $810.0 million, an
increase of $48.1 million, or 6.3%, compared to June 30, 2014. The
principal components of the change in the balance sheet follow:
1. The loan portfolio – excluding
loans held for sale – grew by $58.9 million, or 11.4%, compared to
June 30, 2014, the result of net growth of $65.9 million in
commercial loans purchased or originated by the Bank's Loan
Acquisition and Servicing Group ("LASG"), offset by a $7.0 million
decrease in the Bank's Community Banking Division loan
portfolio.
New loans generated by the LASG
totaled $68.2 million and $121.7 million for the three and
six-month periods, respectively, ending December 31, 2014. The
quarterly growth in LASG loans consisted of $39.7 million in
purchases, at an average price of 85.7%, and $28.5 million in
originations. Residential and consumer loan production sold in the
secondary market totaled $26.0 million for the quarter.
As discussed in the Company's prior
SEC filings, the Company made certain commitments to the Board of
Governors of the Federal Reserve System in connection with the
merger of FHB Formation LLC with and into the Company in December
2010. The Company's loan purchase and commercial real estate loan
availability under these conditions follow.
Basis for Regulatory Condition |
Condition |
Availability at December 31,
2014 |
|
|
(Dollars in millions) |
Total Loans |
Purchased loans may not exceed 40% of total
loans |
$ 19.7 |
Regulatory Capital |
Commercial real estate loans may not exceed
300% of total risk-based capital |
$ 132.6 |
An overview of the Bank's LASG portfolio follows:
|
LASG Portfolio |
|
Three Months Ended
December 31, |
|
2014 |
2013 |
|
Purchased |
Originated |
Total LASG |
Purchased |
Originated |
Total LASG |
|
(Dollars in thousands) |
Loans purchased or originated during the
period: |
|
|
|
|
|
|
Unpaid principal balance |
$ 46,307 |
$ 28,579 |
$ 74,886 |
$ 15,663 |
$ 17,138 |
$ 32,801 |
Net investment basis |
39,667 |
28,565 |
68,232 |
13,619 |
17,138 |
30,757 |
|
|
|
|
|
|
|
Loan returns during the period: |
|
|
|
|
|
|
Yield |
13.27% |
4.00% |
10.17% |
13.82% |
5.14% |
11.38% |
Total Return (1) |
13.72% |
4.57% |
10.67% |
13.76% |
5.14% |
11.35% |
|
|
|
|
|
|
|
|
|
|
Six Months Ended December
31, |
|
2014 |
2013 |
|
Purchased |
Originated |
Total LASG |
Purchased |
Originated |
Total LASG |
|
(Dollars in thousands) |
Loans purchased or originated during the
period: |
|
|
|
|
|
|
Unpaid principal balance |
$ 62,425 |
$ 68,915 |
$ 131,340 |
$ 33,994 |
$ 43,564 |
$ 77,558 |
Net investment basis |
52,834 |
68,904 |
121,738 |
29,967 |
43,564 |
73,531 |
|
|
|
|
|
|
|
Loan returns during the period: |
|
|
|
|
|
|
Yield |
13.02% |
5.08% |
10.53% |
12.00% |
5.37% |
10.35% |
Total Return (1) |
13.24% |
5.58% |
10.85% |
12.20% |
5.37% |
10.51% |
|
|
|
|
|
|
|
Total loans as of period end: |
|
|
|
|
|
|
Unpaid principal balance |
$ 262,445 |
$ 126,620 |
$ 389,065 |
$ 212,767 |
$ 78,828 |
$ 291,595 |
Net investment basis |
$ 220,391 |
$ 126,563 |
$ 346,954 |
$ 177,435 |
$ 78,868 |
$ 256,303 |
|
|
|
|
|
|
|
(1) The total return
on purchased loans represents scheduled accretion, accelerated
accretion, gains on asset sales, and other noninterest income
recorded during the period divided by the average invested balance,
on an annualized basis. |
2. Deposits increased by $37.9
million, or 6.4%, for the quarter, attributable primarily to growth
in non-maturity accounts, which increased by $39.2 million, or
15.5%, for the three months ended December 31, 2014, offset in part
by a decrease of $1.3 million in time deposits. For the six-month
period, deposits increased by $57.4 million, or 10.0%. Growth in
both periods was attributable mainly to increases in money market
accounts attracted through the Bank's online-only ableBanking
division.
3. Stockholders' equity decreased by
$1.1 million from June 30, 2014, due principally to $4.1 million in
share repurchases (representing 448,686 shares), a decrease in
accumulated other comprehensive income of $358 thousand and $204
thousand in dividends paid on common stock, offset in part by
earnings of $3.2 million and $298 thousand of scheduled
amortization of stock-based compensation.
Net income from continuing operations increased by $169 thousand
to $1.6 million for the quarter ended December 31, 2014, compared
to $1.4 million for the quarter ended December 31, 2013.
1. Net interest and dividend income
before provision for loan losses increased by $409 thousand, or
4.5%, for the quarter ended December 31, 2014 compared to the
quarter ended December 31, 2013, due primarily to higher
transactional interest income from purchased loan payoffs and the
positive effect of balance sheet growth. Average total
interest-earning assets for the three months ended December 31,
2014 increased by $76.0 million, and average loans increased by
$59.3 million, when compared to the three months ended December 31,
2013. For the six months ended December 31, 2014, average total
interest-earning assets increased by $68.0 million and average
loans increased by $61.3 million compared to the six months ended
December 31, 2013.
The various components of transactional income are set forth in
the table below entitled "Total Return on Purchased
Loans." When compared to the three and six month periods ended
December 31, 2013, transactional interest income increased by $515
thousand and $1.8 million, respectively. The following table
summarizes interest income and related yields recognized on the
loan portfolios.
|
Interest Income and Yield
on Loans |
|
Three Months Ended
December 31, |
|
2014 |
2013 |
|
Average Balance |
Interest Income |
Yield |
Average Balance |
Interest Income |
Yield |
|
(Dollars in thousands) |
Community Banking Division |
$ 236,127 |
$ 2,899 |
4.87% |
$ 247,057 |
$ 3,284 |
5.27% |
LASG: |
|
|
|
|
|
|
Originated |
105,167 |
1,060 |
4.00% |
68,449 |
886 |
5.14% |
Purchased |
208,935 |
6,989 |
13.27% |
175,469 |
6,112 |
13.82% |
Total LASG |
314,102 |
8,049 |
10.17% |
243,918 |
6,998 |
11.38% |
Total |
$ 550,229 |
$ 10,948 |
7.89% |
$ 490,975 |
$ 10,282 |
8.31% |
|
|
|
|
|
|
|
|
Six Months Ended December
31, |
|
2014 |
2013 |
|
Average Balance |
Interest Income |
Yield |
Average Balance |
Interest Income |
Yield |
|
(Dollars in thousands) |
Community Banking Division |
$ 238,646 |
$ 5,960 |
4.95% |
$ 244,880 |
$ 6,626 |
5.37% |
LASG: |
|
|
|
|
|
|
Originated |
93,751 |
2,399 |
5.08% |
57,828 |
1,566 |
5.37% |
Purchased |
205,896 |
13,511 |
13.02% |
174,318 |
10,547 |
12.00% |
Total LASG |
299,647 |
15,910 |
10.53% |
232,146 |
12,113 |
10.35% |
Total |
$ 538,293 |
$ 21,870 |
8.06% |
$ 477,026 |
$ 18,739 |
7.79% |
The yield on purchased loans in each period shown increased
primarily due to unscheduled loan payoffs, which resulted in
immediate recognition of the prepaid loans' discount in interest
income. The following table details the "total return" on purchased
loans, which includes transactional income of $2.8 million for the
quarter ended December 31, 2014, an increase of $738 thousand from
the quarter ended December 31, 2013. Additionally, total
transactional income for the six months ended December 31, 2014
increased by $1.8 million, compared to the six months ended
December 31, 2013. The following table summarizes the total return
recognized on the purchased loan portfolio.
|
Total Return on Purchased
Loans |
|
Three Months Ended
December 31, |
|
2014 |
2013 |
|
Income |
Return (1) |
Income |
Return (1) |
|
(Dollars in thousands) |
Regularly scheduled interest and
accretion |
$ 4,376 |
8.31% |
$ 4,014 |
9.02% |
Transactional income: |
|
|
|
|
Gains on loan sales |
194 |
0.37% |
11 |
0.02% |
Gain on sale of real estate
owned |
40 |
0.08% |
-- |
0.00% |
Other noninterest income |
-- |
0.00% |
-- |
0.00% |
Accelerated accretion and loan
fees |
2,613 |
4.96% |
2,098 |
4.72% |
Total transactional income |
2,847 |
5.41% |
2,109 |
4.74% |
Total |
$ 7,223 |
13.72% |
$ 6,123 |
13.76% |
|
|
|
|
|
|
Six Months Ended December
31, |
|
2014 |
2013 |
|
|
Income |
Return (1) |
Income |
Return (1) |
|
(Dollars in thousands) |
Regularly scheduled interest and
accretion |
$ 8,873 |
8.55% |
$ 7,753 |
8.78% |
Transactional income: |
|
|
|
|
Gains on loan sales |
190 |
0.18% |
227 |
0.26% |
Gain on sale of real estate
owned |
40 |
0.04% |
-- |
0.00% |
Other noninterest income |
-- |
0.00% |
-- |
0.00% |
Accelerated accretion and loan
fees |
4,638 |
4.47% |
2,794 |
3.16% |
Total transactional income |
4,868 |
4.69% |
3,021 |
3.42% |
Total |
$ 13,741 |
13.24% |
$ 10,774 |
12.20% |
|
|
|
|
|
(1) The total return
on purchased loans represents scheduled accretion, accelerated
accretion, gains on asset sales, and other noninterest income
recorded during the period divided by the average invested balance,
on an annualized basis. |
2. Noninterest income increased by
$535 thousand for the quarter ended December 31, 2014, compared to
the quarter ended December 31, 2013, principally due to the
following:
- An increase of $432 thousand in gain on sales of portfolio
loans, realized primarily on the sale of the guaranteed portion of
SBA loans. The Company recognized $445 thousand in gains on SBA
loans sold for the three months ended December 31, 2014, compared
to no SBA gain for the quarter ended December 31, 2013; and
- An increase of $106 thousand in gains realized on sale of
residential loans originated for sale in the secondary market, due
principally to an increase in purchase-related mortgage loan
activity in the current period.
3. Noninterest expense increased by
$596 thousand for the quarter ended December 31, 2014, compared to
the quarter ended December 31, 2013, principally due to the
following:
- An increase of $484 thousand in salaries and employee benefits,
principally due to increased employee head count and incentive
compensation, offset by a decrease in group insurance expense and
employee stock options expense;
- An increase of $177 thousand in professional fees, due
primarily to fees for temporary consulting services;
- An increase of $123 thousand in loan acquisition and collection
expenses, due in part to an increased level of loan purchases in
the quarter ended December 31, 2014 when compared to the quarter
ended December 31, 2013; and
- A decrease of $130 thousand in occupancy and equipment expense,
the result of a reduction in software maintenance and depreciation
expense following the conversion of the Bank's core systems
platform to an outsourced model in May 2014. The decrease in
equipment expense was offset in part by higher data processing
fees, which increased by $70 thousand.
4. The Company's effective tax rate
for the quarter ended December 31, 2014 was 36.1%, compared to
32.4% for the quarter ended December 31, 2013. The increase in the
quarter was primarily the result of a change in estimated state tax
apportionment.
At December 31, 2014, nonperforming assets totaled $14.3
million, or 1.8% of total assets, as compared to $9.3 million, or
1.2% of total assets at June 30, 2014. The increase in
nonperforming assets during the six months ended December 31, 2014
was mainly due to the addition of one recently-purchased loan
relationship.
At December 31, 2014, the Company's Tier 1 leverage capital
ratio was 14.8%, a decrease from 15.9% at June 30, 2014, and the
total risk-based capital ratio was 21.4%, a decrease from 23.7% at
June 30, 2014. The decreases resulted primarily from balance sheet
growth and the effect of purchases under the Company's share
repurchase program in the six months ended December 31, 2014.
Investor Call Information
Richard Wayne, Chief Executive Officer of Northeast Bancorp,
Claire Bean, Chief Operating Officer of Northeast Bancorp, and
Brian Shaughnessy, Chief Financial Officer of Northeast Bancorp,
will host a conference call to discuss second quarter
earnings and business outlook at 9:00 a.m. Eastern Time on Friday,
January 30, 2015. Investors can access the call by dialing
877.878.2762 and entering the following passcode: 70956761. The
call will be available via live webcast, which can be viewed by
accessing the Company's website at www.northeastbank.com and
clicking on the About Us - Investor Relations section. To listen to
the webcast, attendees are encouraged to visit the website at least
fifteen minutes early to register, download and install any
necessary audio software. Please note there will also be a slide
presentation that will accompany the webcast. For those who cannot
listen to the live broadcast, a replay will be available online for
one year at www.northeastbank.com.
About Northeast Bancorp
Northeast Bancorp (Nasdaq:NBN) is the holding company for
Northeast Bank, a full-service bank headquartered in Lewiston,
Maine. Northeast Bank offers traditional banking services through
its Community Banking Division, which operates ten full-service
branches and two loan production offices that serve individuals and
businesses located in western and south-central Maine and southern
New Hampshire. Northeast Bank's Loan Acquisition and Servicing
Group purchases and originates commercial loans for the Bank's
portfolio. In addition, the Small Business Lending division
supports the needs of growing businesses nationally. ableBanking, a
division of Northeast Bank, offers savings products to consumers
online. Information regarding Northeast Bank can be found on its
website at www.northeastbank.com.
Non-GAAP Financial Measure
In addition to results presented in accordance with generally
accepted accounting principles ("GAAP"), this press release
contains certain non-GAAP financial measures, including tangible
common stockholders' equity, tangible book value per share, and net
operating earnings. Northeast's management believes that the
supplemental non-GAAP information is utilized by regulators and
market analysts to evaluate a company's financial condition and
therefore, such information is useful to investors. These
disclosures should not be viewed as a substitute for financial
results determined in accordance with GAAP, nor are they
necessarily comparable to non-GAAP performance measures that may be
presented by other companies. Because non-GAAP financial measures
are not standardized, it may not be possible to compare these
financial measures with other companies' non-GAAP financial
measures having the same or similar names.
Statements in this press release that are not historical facts
are forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, and are intended to be
covered by the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Although Northeast believes that
these forward-looking statements are based on reasonable estimates
and assumptions, they are not guarantees of future performance and
are subject to known and unknown risks, uncertainties, and other
factors. You should not place undue reliance on our forward-looking
statements. You should exercise caution in interpreting and relying
on forward-looking statements because they are subject to
significant risks, uncertainties and other factors which are, in
some cases, beyond the Company's control. The Company's actual
results could differ materially from those projected in the
forward-looking statements as a result of, among other factors,
changes in interest rates and real estate values; competitive
pressures from other financial institutions; the effects of
weakness in general economic conditions on a national basis or in
the local markets in which the Company operates, including changes
which adversely affect borrowers' ability to service and repay our
loans; changes in loan defaults and charge-off rates; changes in
the value of securities and other assets, adequacy of loan loss
reserves, or deposit levels necessitating increased borrowing to
fund loans and investments; increasing government regulation; the
risk that the Company may not be successful in the implementation
of its business strategy; the risk that intangibles recorded in the
Company's financial statements will become impaired; changes in
assumptions used in making such forward-looking statements; and the
other risks and uncertainties detailed in the Company's Annual
Report on Form 10-K and updated by the Company's Quarterly Reports
on Form 10-Q and other filings submitted to the Securities and
Exchange Commission. These statements speak only as of the date of
this release and the Company does not undertake any obligation to
update or revise any of these forward-looking statements to reflect
events or circumstances occurring after the date of this
communication or to reflect the occurrence of unanticipated
events.
NBN-F
NORTHEAST
BANCORP AND SUBSIDIARY |
|
|
CONSOLIDATED
BALANCE SHEETS |
|
|
(Unaudited) |
|
|
(Dollars in
thousands, except share and per share data) |
|
|
|
December 31, 2014 |
June 30, 2014 |
Assets |
|
|
Cash and due from banks |
$ 2,626 |
$ 3,372 |
Short-term investments |
80,643 |
78,887 |
Total cash and cash
equivalents |
83,269 |
82,259 |
|
|
|
Available-for-sale securities, at fair
value |
107,841 |
113,881 |
Loans held for sale |
5,154 |
11,945 |
|
|
|
Loans |
|
|
Commercial real estate |
343,479 |
316,098 |
Residential real estate |
140,019 |
148,634 |
Commercial and industrial |
82,939 |
41,800 |
Consumer |
8,898 |
9,884 |
Total loans |
575,335 |
516,416 |
Less: Allowance for loan
losses |
1,664 |
1,367 |
Loans, net |
573,671 |
515,049 |
|
|
|
Premises and equipment, net |
8,494 |
9,135 |
Real estate owned and other possessed
collateral, net |
2,058 |
1,991 |
Regulatory stock, at cost |
4,102 |
4,102 |
Intangible assets, net |
2,466 |
2,798 |
Bank owned life insurance |
15,055 |
14,836 |
Other assets |
7,925 |
5,935 |
Total assets |
$ 810,035 |
$ 761,931 |
|
|
|
Liabilities and Stockholders' Equity |
|
|
Deposits |
|
|
Demand |
$ 51,920 |
$ 50,140 |
Savings and interest
checking |
95,373 |
98,340 |
Money market |
144,523 |
83,901 |
Time |
339,904 |
341,948 |
Total deposits |
631,720 |
574,329 |
|
|
|
Federal Home Loan Bank
advances |
35,244 |
42,824 |
Wholesale repurchase
agreements |
10,117 |
10,199 |
Short-term borrowings |
2,775 |
2,984 |
Junior subordinated debentures
issued to affiliated trusts |
8,530 |
8,440 |
Capital lease obligation |
1,464 |
1,558 |
Other liabilities |
9,262 |
9,531 |
Total liabilities |
699,112 |
649,865 |
|
|
|
Commitments and contingencies |
-- |
-- |
|
|
|
Stockholders' equity |
|
|
Preferred stock, $1.00 par
value, 1,000,000 shares authorized; no shares issued and
outstanding at December 31, 2014 and June 30, 2014 |
-- |
-- |
Voting common stock, $1.00 par
value, 25,000,000 shares authorized; 8,965,424 and 9,260,331 shares
issued and outstanding at December 31, 2014 and June 30, 2014,
respectively |
8,965 |
9,260 |
Non-voting common stock, $1.00
par value, 3,000,000 shares authorized; 880,963 shares issued and
outstanding at December 31, 2014 and June 30, 2014 |
881 |
881 |
Additional paid-in
capital |
87,404 |
90,914 |
Retained earnings |
15,314 |
12,294 |
Accumulated other comprehensive
income (loss) |
(1,641) |
(1,283) |
Total stockholders' equity |
110,923 |
112,066 |
Total liabilities and
stockholders' equity |
$ 810,035 |
$ 761,931 |
|
|
|
|
|
NORTHEAST
BANCORP AND SUBSIDIARY |
|
|
|
|
CONSOLIDATED
STATEMENTS OF INCOME |
|
|
|
|
(Unaudited) |
|
|
|
|
(Dollars in
thousands, except share and per share data) |
|
|
|
|
|
Three Months Ended
December 31, |
Six Months Ended December
31, |
|
2014 |
2013 |
2014 |
2013 |
Interest and dividend income: |
|
|
|
|
Interest on loans |
$ 10,948 |
$ 10,282 |
$ 21,870 |
$ 18,739 |
Interest on available-for-sale
securities |
232 |
262 |
475 |
544 |
Other interest and dividend
income |
79 |
96 |
146 |
147 |
Total interest and dividend
income |
11,259 |
10,640 |
22,491 |
19,430 |
|
|
|
|
|
Interest expense: |
|
|
|
|
Deposits |
1,281 |
979 |
2,410 |
2,026 |
Federal Home Loan Bank
advances |
265 |
327 |
588 |
651 |
Wholesale repurchase
agreements |
73 |
98 |
145 |
192 |
Short-term borrowings |
7 |
6 |
16 |
11 |
Junior subordinated debentures
issued to affiliated trusts |
188 |
192 |
394 |
385 |
Obligation under capital lease
agreements |
19 |
21 |
38 |
43 |
Total interest expense |
1,833 |
1,623 |
3,591 |
3,308 |
|
|
|
|
|
Net interest and dividend income before
provision for loan losses |
9,426 |
9,017 |
18,900 |
16,122 |
Provision for loan losses |
113 |
151 |
433 |
227 |
Net interest and dividend income after
provision for loan losses |
9,313 |
8,866 |
18,467 |
15,895 |
|
|
|
|
|
Noninterest income: |
|
|
|
|
Fees for other services to
customers |
392 |
421 |
786 |
861 |
Gain on sales of loans held for
sale |
447 |
341 |
1,029 |
880 |
Gain on sales of portfolio
loans |
445 |
13 |
525 |
230 |
(Loss) gain recognized on real
estate owned and other repossessed collateral, net |
(31) |
(77) |
(54) |
(115) |
Bank-owned life insurance
income |
110 |
116 |
219 |
234 |
Other noninterest income |
7 |
21 |
19 |
34 |
Total noninterest income |
1,370 |
835 |
2,524 |
2,124 |
|
|
|
|
|
Noninterest expense: |
|
|
|
|
Salaries and employee
benefits |
4,737 |
4,253 |
9,270 |
8,865 |
Occupancy and equipment
expense |
1,181 |
1,311 |
2,384 |
2,601 |
Professional fees |
458 |
281 |
766 |
657 |
Data processing fees |
347 |
277 |
692 |
554 |
Marketing expense |
80 |
103 |
148 |
139 |
Loan acquisition and collection
expense |
413 |
290 |
687 |
763 |
FDIC insurance premiums |
110 |
117 |
234 |
227 |
Intangible asset
amortization |
166 |
210 |
331 |
420 |
Legal settlement recovery |
-- |
-- |
-- |
(250) |
Other noninterest expense |
718 |
772 |
1,437 |
1,490 |
Total noninterest expense |
8,210 |
7,614 |
15,949 |
15,466 |
|
|
|
|
|
Income from continuing operations before
income tax expense |
2,473 |
2,087 |
5,042 |
2,553 |
Income tax expense |
893 |
676 |
1,818 |
832 |
Net income from continuing operations |
1,580 |
1,411 |
3,224 |
1,721 |
|
|
|
|
|
Income from discontinued operations before
tax (benefit) expense |
-- |
(27) |
-- |
(12) |
Income tax (benefit) expense |
-- |
(9) |
-- |
(4) |
Net (loss) income from discontinued
operations |
-- |
(18) |
-- |
(8) |
Net income |
$ 1,580 |
$ 1,393 |
$ 3,224 |
$ 1,713 |
|
|
|
|
|
Weighted-average shares outstanding: |
|
|
|
|
Basic |
10,132,349 |
10,432,833 |
10,155,598 |
10,436,673 |
Diluted |
10,132,349 |
10,432,833 |
10,155,598 |
10,436,673 |
Earnings per common share: |
|
|
|
|
Basic: |
|
|
|
|
Income from continuing
operations |
$ 0.16 |
$ 0.13 |
$ 0.32 |
$ 0.16 |
Income from discontinued
operations |
0.00 |
0.00 |
0.00 |
0.00 |
Net Income |
$ 0.16 |
$ 0.13 |
$ 0.32 |
$ 0.16 |
Diluted: |
|
|
|
|
Income from continuing
operations |
$ 0.16 |
$ 0.13 |
$ 0.32 |
$ 0.16 |
Income from discontinued
operations |
0.00 |
0.00 |
0.00 |
0.00 |
Net Income |
$ 0.16 |
$ 0.13 |
$ 0.32 |
$ 0.16 |
Cash dividends declared per common share |
$ 0.01 |
$ 0.09 |
$ 0.02 |
$ 0.18 |
|
|
|
|
|
|
|
NORTHEAST
BANCORP AND SUBSIDIARY |
|
|
|
|
|
|
CONSOLIDATED
AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS |
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
(Dollars in
thousands) |
|
|
|
|
|
|
|
Three Months Ended
December 31, |
|
2014 |
2013 |
|
Average Balance |
Interest Income/ Expense |
Average Yield/ Rate |
Average Balance |
Interest Income/ Expense |
Average Yield/ Rate |
Assets: |
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
Investment securities (1) |
$ 109,498 |
$ 232 |
0.84% |
$ 116,888 |
$ 262 |
0.89% |
Loans (2) (3) |
550,229 |
10,948 |
7.89% |
490,975 |
10,282 |
8.31% |
Regulatory stock |
4,102 |
15 |
1.45% |
5,721 |
48 |
3.33% |
Short-term investments (4) |
104,822 |
64 |
0.24% |
79,049 |
48 |
0.24% |
Total interest-earning assets |
768,651 |
11,259 |
5.81% |
692,633 |
10,640 |
6.09% |
Cash and due from banks |
2,637 |
|
|
3,053 |
|
|
Other non-interest earning assets |
32,500 |
|
|
36,222 |
|
|
Total assets |
$ 803,788 |
|
|
$ 731,908 |
|
|
|
|
|
|
|
|
|
Liabilities & Stockholders' Equity: |
|
|
|
|
|
|
Interest-bearing liabilities: |
|
|
|
|
|
|
NOW accounts |
$ 62,259 |
$ 40 |
0.25% |
$ 58,987 |
$ 40 |
0.27% |
Money market accounts |
127,394 |
241 |
0.75% |
86,245 |
114 |
0.52% |
Savings accounts |
33,648 |
12 |
0.14% |
33,540 |
12 |
0.14% |
Time deposits |
348,118 |
988 |
1.13% |
309,790 |
813 |
1.04% |
Total interest-bearing
deposits |
571,419 |
1,281 |
0.89% |
488,562 |
979 |
0.80% |
Short-term
borrowings |
2,869 |
7 |
0.97% |
2,397 |
6 |
0.99% |
Borrowed funds |
45,587 |
357 |
3.11% |
59,941 |
446 |
2.95% |
Junior subordinated
debentures |
8,508 |
188 |
8.77% |
8,331 |
192 |
9.14% |
Total interest-bearing liabilities |
628,383 |
1,833 |
1.16% |
559,231 |
1,623 |
1.15% |
|
|
|
|
|
|
|
Non-interest bearing liabilities: |
|
|
|
|
|
|
Demand deposits and escrow accounts |
55,131 |
|
|
53,184 |
|
|
Other liabilities |
7,130 |
|
|
5,677 |
|
|
Total liabilities |
690,644 |
|
|
618,092 |
|
|
Stockholders' equity |
113,144 |
|
|
113,816 |
|
|
Total liabilities and stockholders'
equity |
$ 803,788 |
|
|
$ 731,908 |
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ 9,426 |
|
|
$ 9,017 |
|
|
|
|
|
|
|
|
Interest rate spread |
|
|
4.65% |
|
|
4.94% |
Net interest margin (5) |
|
|
4.87% |
|
|
5.16% |
|
|
|
|
|
|
|
(1) Interest
income and yield are stated on a fully tax-equivalent basis using a
34% tax rate. |
|
|
|
|
|
|
(2) Includes
loans held for sale. |
|
|
|
|
|
|
(3) Nonaccrual
loans are included in the computation of average, but unpaid
interest has not been included for purposes of determining interest
income. |
|
|
(4) Short term
investments include FHLB overnight deposits and other
interest-bearing deposits. |
|
|
|
|
|
(5) Net interest
margin is calculated as net interest income divided by total
interest-earning assets. |
|
|
|
|
|
|
|
|
|
|
|
|
NORTHEAST
BANCORP AND SUBSIDIARY |
|
|
|
|
|
|
CONSOLIDATED
AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS |
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
(Dollars in
thousands) |
|
|
|
|
|
|
|
Six Months Ended December
31, |
|
2014 |
2013 |
|
Average Balance |
Interest Income/ Expense |
Average Yield/ Rate |
Average Balance |
Interest Income/ Expense |
Average Yield/ Rate |
Assets: |
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
Investment securities (1) |
$ 110,874 |
$ 475 |
0.85% |
$ 118,093 |
$ 544 |
0.91% |
Loans (2) (3) |
538,293 |
21,870 |
8.06% |
477,026 |
18,739 |
7.79% |
Regulatory stock |
4,102 |
31 |
1.50% |
5,721 |
52 |
1.80% |
Short-term investments (4) |
93,792 |
115 |
0.24% |
78,228 |
95 |
0.24% |
Total interest-earning assets |
747,061 |
22,491 |
5.97% |
679,068 |
19,430 |
5.68% |
Cash and due from banks |
2,674 |
|
|
3,045 |
|
|
Other non-interest earning assets |
33,326 |
|
|
35,117 |
|
|
Total assets |
$ 783,061 |
|
|
$ 717,230 |
|
|
|
|
|
|
|
|
|
Liabilities & Stockholders' Equity: |
|
|
|
|
|
|
Interest-bearing liabilities: |
|
|
|
|
|
|
NOW accounts |
$ 62,934 |
$ 81 |
0.26% |
$ 59,055 |
$ 80 |
0.27% |
Money market accounts |
106,844 |
365 |
0.68% |
85,967 |
226 |
0.52% |
Savings accounts |
34,004 |
23 |
0.13% |
33,733 |
24 |
0.14% |
Time deposits |
344,243 |
1,941 |
1.12% |
297,090 |
1,696 |
1.13% |
Total interest-bearing
deposits |
548,025 |
2,410 |
0.87% |
475,845 |
2,026 |
0.84% |
Short-term
borrowings |
3,095 |
16 |
1.03% |
2,337 |
11 |
0.93% |
Borrowed funds |
49,283 |
771 |
3.10% |
59,964 |
886 |
2.93% |
Junior subordinated
debentures |
8,484 |
394 |
9.21% |
8,309 |
385 |
9.19% |
Total interest-bearing liabilities |
608,887 |
3,591 |
1.17% |
546,455 |
3,308 |
1.20% |
|
|
|
|
|
|
|
Non-interest bearing liabilities: |
|
|
|
|
|
|
Demand deposits and escrow accounts |
54,187 |
|
|
51,788 |
|
|
Other liabilities |
7,220 |
|
|
5,619 |
|
|
Total liabilities |
670,294 |
|
|
603,862 |
|
|
Stockholders' equity |
112,767 |
|
|
113,368 |
|
|
Total liabilities and stockholders'
equity |
$ 783,061 |
|
|
$ 717,230 |
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ 18,900 |
|
|
$ 16,122 |
|
|
|
|
|
|
|
|
Interest rate spread |
|
|
4.80% |
|
|
4.48% |
Net interest margin (5) |
|
|
5.02% |
|
|
4.71% |
|
|
|
|
|
|
|
(1) Interest
income and yield are stated on a fully tax-equivalent basis using a
34% tax rate. |
|
|
|
|
|
|
(2) Includes
loans held for sale. |
|
|
|
|
|
|
(3) Nonaccrual
loans are included in the computation of average, but unpaid
interest has not been included for purposes of determining interest
income. |
|
|
(4) Short term
investments include FHLB overnight deposits and other
interest-bearing deposits. |
|
|
|
|
|
|
(5) Net interest
margin is calculated as net interest income divided by total
interest-earning assets. |
|
|
|
|
|
|
|
|
|
|
|
|
NORTHEAST
BANCORP AND SUBSIDIARY |
|
|
|
|
|
SELECTED
CONSOLIDATED FINANCIAL HIGHLIGHTS AND OTHER DATA |
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
(Dollars in
thousands, except share and per share data) |
|
|
|
|
|
|
Three Months Ended: |
|
December 31,
2014 |
September 30, 2014 |
June 30, 2014 |
March 31, 2014 |
December 31, 2013 |
Net interest income |
$ 9,426 |
$ 9,471 |
$ 8,484 |
$ 7,112 |
$ 9,017 |
Provision for loan losses |
113 |
320 |
124 |
180 |
151 |
Noninterest income |
1,370 |
1,154 |
1,437 |
1,308 |
835 |
Noninterest expense |
8,210 |
7,737 |
8,795 |
7,516 |
7,614 |
Net income from continuing operations |
1,580 |
1,644 |
542 |
437 |
1,411 |
Net income |
1,580 |
1,644 |
542 |
437 |
1,393 |
|
|
|
|
|
|
Weighted average common shares
outstanding: |
|
|
|
|
|
Basic |
10,132,349 |
10,180,038 |
10,314,197 |
10,432,494 |
10,432,833 |
Diluted |
10,132,349 |
10,180,038 |
10,314,197 |
10,432,494 |
10,432,833 |
Earnings per common share: |
|
|
|
|
|
Basic |
$0.16 |
$0.16 |
$0.05 |
$0.04 |
$0.13 |
Diluted |
0.16 |
0.16 |
0.05 |
0.04 |
0.13 |
Dividends per common share |
0.01 |
0.01 |
0.01 |
0.09 |
0.09 |
|
|
|
|
|
|
Return on average assets |
0.78% |
0.85% |
0.29% |
0.24% |
0.76% |
Return on average equity |
5.54% |
5.80% |
1.98% |
1.55% |
4.86% |
Net interest rate spread (1) |
4.65% |
4.95% |
4.53% |
3.87% |
4.94% |
Net interest margin (2) |
4.87% |
5.18% |
4.75% |
4.08% |
5.16% |
Efficiency ratio (3) |
76.05% |
72.82% |
88.65% |
89.26% |
77.28% |
Noninterest expense to average total
assets |
4.05% |
4.02% |
4.69% |
4.08% |
4.13% |
Average interest-earning assets to
average |
122.32% |
123.09% |
121.92% |
122.17% |
123.85% |
interest-bearing liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
As of: |
|
December 31,
2014 |
September 30, 2014 |
June 30, 2014 |
March 31, 2014 |
December 31, 2013 |
Nonperforming loans: |
|
|
|
|
|
Originated portfolio: |
|
|
|
|
|
Residential real estate |
$ 2,706 |
$ 2,105 |
$ 1,743 |
$ 1,678 |
$ 1,895 |
Commercial real estate |
1,166 |
721 |
1,162 |
798 |
487 |
Home equity |
11 |
28 |
160 |
214 |
204 |
Commercial business |
-- |
-- |
5 |
-- |
61 |
Consumer |
237 |
145 |
139 |
152 |
259 |
Total originated portfolio |
4,120 |
2,999 |
3,209 |
2,842 |
2,906 |
Total purchased portfolio |
8,129 |
4,287 |
4,116 |
4,582 |
3,245 |
Total nonperforming loans |
12,249 |
7,286 |
7,325 |
7,424 |
6,151 |
Real estate owned and other possessed
collateral, net |
2,058 |
2,115 |
1,991 |
2,000 |
3,211 |
Total nonperforming assets |
$ 14,307 |
$ 9,401 |
$ 9,316 |
$ 9,424 |
$ 9,362 |
|
|
|
|
|
|
Past due loans to total loans |
2.64% |
1.40% |
1.14% |
|
|
Nonperforming loans to total loans |
2.13% |
1.34% |
1.42% |
|
|
Nonperforming assets to total assets |
1.77% |
1.20% |
1.22% |
|
|
Allowance for loan losses to total loans |
0.29% |
0.28% |
0.26% |
0.26% |
0.27% |
Allowance for loan losses to nonperforming
loans |
13.58% |
21.12% |
18.66% |
18.12% |
21.95% |
|
|
|
|
|
|
Commercial real estate loans to risk-based
capital (4) |
190.05% |
167.57% |
176.98% |
175.10% |
170.69% |
Net loans to core deposits (5) |
91.79% |
92.80% |
92.13% |
93.18% |
95.10% |
Purchased loans to total loans, including
held for sale |
37.97% |
37.38% |
38.51% |
35.29% |
34.89% |
Equity to total assets |
13.69% |
14.48% |
14.71% |
15.18% |
15.61% |
Tier 1 leverage capital ratio |
14.81% |
15.89% |
15.90% |
16.28% |
16.66% |
Total risk-based capital ratio |
21.44% |
22.97% |
23.69% |
24.21% |
24.61% |
|
|
|
|
|
|
Total stockholders' equity |
$ 110,923 |
$ 113,242 |
$ 112,066 |
$ 114,008 |
$ 114,383 |
Less: Preferred stock |
-- |
-- |
-- |
-- |
-- |
Common stockholders' equity |
110,923 |
113,242 |
112,066 |
114,008 |
114,383 |
Less: Intangible assets |
(2,466) |
(2,632) |
(2,798) |
(2,962) |
(3,124) |
Tangible common stockholders' equity
(non-GAAP) |
$ 108,457 |
$ 110,610 |
$ 109,268 |
$ 111,046 |
$ 111,259 |
|
|
|
|
|
|
Common shares outstanding |
9,846,387 |
10,248,034 |
10,141,294 |
10,432,494 |
10,432,494 |
Book value per common share |
$ 11.27 |
$ 11.05 |
$ 11.05 |
$ 10.93 |
|
Tangible book value per share (non-GAAP)
(6) |
11.01 |
10.79 |
10.77 |
10.64 |
10.66 |
|
|
|
|
|
|
|
Reconciliation of Net
Income (GAAP) to Net Operating Earnings (non-GAAP) |
|
Three Months Ended: |
|
December 31,
2014 |
September 30, 2014 |
June 30, 2014 |
March 31, 2014 |
December 31, 2013 |
Net income (GAAP) |
$ 1,580 |
$ 1,644 |
$ 542 |
$ 437 |
$ 1,393 |
Items excluded from operating
earnings, net of tax: |
|
|
|
|
|
Discontinued operations |
-- |
-- |
-- |
-- |
18 |
Income from life insurance
death benefits |
36 |
52 |
407 |
35 |
-- |
Severance expense |
-- |
-- |
148 |
84 |
59 |
Legal settlement expense and
related professional fees |
-- |
-- |
-- |
-- |
-- |
Total after-tax items |
36 |
52 |
555 |
119 |
77 |
Net operating earnings (non-GAAP) |
$ 1,616 |
$ 1,696 |
$ 1,097 |
$ 556 |
$ 1,470 |
Net operating earnings per share - basic
(non-GAAP) |
$ 0.16 |
$ 0.17 |
$ 0.11 |
$ 0.05 |
$ 0.14 |
|
|
|
|
|
|
(1) The net interest
rate spread represents the difference between the weighted-average
yield on interest-earning assets and the weighted-average cost of
interest-bearing liabilities for the period. |
|
|
(2) The net interest
margin represents net interest income as a percent of average
interest-earning assets for the period. |
|
|
|
|
|
(3) The efficiency
ratio represents non-interest expense divided by the sum of net
interest income (before the loan loss provision) plus non-interest
income. |
|
|
|
|
(4) For purposes of
calculating this ratio, commercial real estate includes all those
loans defined as such by regulatory guidance, including all land
development and construction loans. |
|
|
|
(5) Core deposits
include all non-maturity deposits and maturity deposits less than
$250 thousand. Loans include loans held-for-sale. |
|
|
|
|
|
(6) Tangible book
value per share represents total stockholders' equity less the sum
of preferred stock and intangible assets divided by common shares
outstanding. |
|
|
|
|
CONTACT: For More Information:
Claire S. Bean, COO
Northeast Bank, 500 Canal Street, Lewiston, ME 04240
207.786.3245 ext. 3202
www.northeastbank.com
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