First Defiance Financial Corp. Announces 2015 First Quarter Earnings

  • Earnings per share of $0.69 for 2015 first quarter, up from $0.51 per share in the first quarter of 2014
  • Net income of $6.6 million for 2015 first quarter compared to $5.2 million in the first quarter of 2014
  • Net interest margin of 3.88%, up from 3.61% in the first quarter of 2014
  • Loan growth $37.7 million during the 2015 first quarter
  • Deposit growth $11.9 million during the 2015 first quarter
  • Nonperforming loans down 30.1% from first quarter of 2014

DEFIANCE, Ohio--()--First Defiance Financial Corp. (NASDAQ: FDEF) announced today that net income for the first quarter ended March 31, 2015 totaled $6.6 million, or $0.69 per diluted common share, compared to $5.2 million or $0.51 per diluted common share for the quarter ended March 31, 2014.

The first quarter 2014 results were negatively impacted by $786,000 ($511,000 after tax), or $0.05 per diluted common share, for costs to terminate a merger agreement.

“We are extremely pleased with our overall results for the first quarter, especially our progress regarding our strategic priorities,” said Donald P. Hileman, President and CEO of First Defiance Financial Corp. “Compared to the first quarter last year, total revenues grew by 9.7%, the efficiency ratio improved by over 5% and total nonperforming assets declined by 23.5%. We are very encouraged by such a strong start to 2015.”

Net Interest Income up from first quarter 2014

Net interest income of $18.2 million in the first quarter of 2015 was up from $16.8 million in the first quarter of 2014. The net interest margin increased to 3.88% in the first quarter of 2015 compared with 3.61% in the first quarter of 2014 and 3.76% in the fourth quarter of 2014. Yield on interest earning assets increased by 24 basis points, to 4.20% in the first quarter of 2015 from 3.96% in the first quarter of 2014. The cost of interest-bearing liabilities decreased by 3 basis points in the first quarter of 2015 to 0.42% from 0.45% in the first quarter of 2014.

“Our solid loan growth in the first quarter further improved our earning asset mix and yield, increasing our net interest margin,” said Hileman. “Our net interest margin improved to 3.88%, up 27 basis points from the first quarter last year; and net interest income increased $1.4 million, or 8.3%.”

Non-Interest Income up from first quarter 2014

First Defiance’s non-interest income for the first quarter of 2015 was $8.3 million compared with $7.3 million in the first quarter of 2014. Mortgage banking income was $1.8 million in the first quarter of 2015, up from $1.2 million in the first quarter of 2014. Gains from the sale of mortgage loans increased in the first quarter of 2015 to $1.3 million from $641,000 in the first quarter of 2014. Mortgage loan servicing revenue was $875,000 in the first quarter of 2015, down slightly from $905,000 in the first quarter of 2014. The Company had a positive change in the valuation adjustment in mortgage servicing rights of $26,000 in the first quarter of 2015 compared with a negative adjustment of $7,000 in the first quarter of 2014.

Service fees and other charges were $2.5 million in the first quarter of 2015, up from $2.3 million in the first quarter of 2014 due to the benefits of new fee structures and product redesigns implemented in the third quarter of 2014.

Income from the sale of insurance and investment products was $3.1 million for the first quarter of 2015, compared with $3.0 million in the first quarter of 2014. The first quarter typically includes contingent revenues, bonuses paid by insurance carriers when the Company achieves certain loss ratios or growth targets. In the first quarter of 2015, First Defiance’s insurance subsidiary, First Insurance Group, earned $967,000 of contingent income, compared to $878,000 during the first quarter of 2014.

“Our non-interest income was very strong this quarter, up 13% versus the same quarter last year, with improvements in all of our key business lines,” stated Hileman. “Lower interest rates aided in a notably robust quarter for mortgage banking where mortgage origination volumes were up 83% from the prior year.”

Non-Interest Expenses up from first quarter 2014

Total non-interest expense was $16.9 million in the first quarter of 2015, an increase from $16.7 million in the first quarter of 2014. Compensation and benefits increased to $8.9 million in the first quarter of 2015 compared to $8.5 million in the first quarter of 2014. The increase in compensation and benefits from a year ago is mainly related to merit increases and higher incentive compensation accruals partially offset by lower medical insurance costs. Occupancy expense was $1.8 million in the first quarter 2015, up from $1.6 million in the first quarter 2014. Data processing cost increased to $1.5 million in the first quarter of 2015 from $1.4 million in the first quarter of 2014. Other non-interest expense was $3.6 million in the first quarter of 2015, a decrease from $4.1 million in the first quarter of 2014. The decrease in other non-interest expense is due to a $786,000 cost in the first quarter 2014 for terminating a merger agreement which was partially offset by $522,000 of fixed asset real estate owned write-downs in the first quarter of 2015.

Credit Quality

Nonperforming loans totaled $18.7 million at March 31, 2015, a decrease from $26.8 million at March 31, 2014. In addition, First Defiance had $6.4 million of real estate owned at March 31, 2015 compared to $6.0 million at March 31, 2014. Accruing troubled debt restructured loans were $19.6 million at March 31, 2015 compared with $26.7 million at March 31, 2014. For the first quarter of 2015, First Defiance recorded $416,000 of net recoveries versus net charge-offs of $270,000 in the first quarter of 2014. The allowance for loan loss as a percentage of total loans was 1.50% at March 31, 2015 compared with 1.58% at March 31, 2014.

The first quarter results include expense for provision for loan losses of $120,000, compared with $103,000 for the same period in 2014.

“Our asset quality improvement was significant this quarter with reductions in nonperforming loans of $5.4 million and restructured loans of $5.1 million,” said Hileman. “Our allowance for loan losses coverage of nonperforming loans is now over 135%.”

Total Assets at $2.2 Billion

Total assets at March 31, 2015 were $2.20 billion compared to $2.18 billion at December 31, 2014 and $2.16 billion at March 31, 2014. Net loans receivable (excluding loans held for sale) were $1.66 billion at March 31, 2015 compared to $1.62 billion at December 31, 2014 and $1.54 billion at March 31, 2014. Total cash and cash equivalents were $81.5 million at March 31, 2015 compared with $112.9 million at December 31, 2014 and $211.2 million at March 31, 2014. Also, at March 31, 2015, goodwill and other intangible assets totaled $63.7 million compared to $63.9 million at December 31, 2014 and $64.7 million at March 31, 2014.

Total deposits at March 31, 2015 were $1.77 billion compared with $1.76 billion at both December 31, 2014 and March 31, 2014. Non-interest bearing deposits at March 31, 2015 were $371.0 million compared to $379.6 million at December 31, 2014 and $338.4 million at March 31, 2014. Total stockholders’ equity was $273.1 million at March 31, 2015 compared to $279.5 million at December 31, 2014 and $274.9 million at March 31, 2014.

The reduction in stockholders’ equity from year-end 2014 includes the $12 million cost of the previously announced March 11, 2015 repurchase of the warrant issued to the U.S. Treasury under the TARP Capital Purchase Program.

Dividend to be paid May 28

The Board of Directors declared a quarterly cash dividend of $0.20 per common share payable May 28, 2015 to shareholders of record at the close of business on May 21, 2015. The dividend represents an annual dividend of 2.46% based on the First Defiance common stock closing price on April 17, 2015. As of that date, First Defiance had approximately 9,253,133 common shares outstanding.

Conference Call

First Defiance will host a conference call at 11:00 a.m. (ET) on Tuesday, April 21, 2015 to discuss the earnings results and business trends. The conference call may be accessed by calling 1-877-444-1726. In addition, a live webcast may be accessed at http://services.choruscall.com/links/fdef150421.html.

Replay of the Internet Webcast will be available at www.fdef.com until April 21, 2016.

Annual Meeting of Shareholders

First Defiance will host its Annual Meeting of Shareholders at 2:00 p.m. on Tuesday, April 21, 2015. This Annual Meeting will be an entirely virtual meeting, meaning all shareholders will attend online. Following the meeting, the audio replay and transcript will be available at the Company’s Website at www.fdef.com.

First Defiance Financial Corp.

First Defiance Financial Corp., headquartered in Defiance, Ohio, is the holding company for First Federal Bank of the Midwest and First Insurance Group. First Federal operates 33 full-service branches and 42 ATM locations in northwest Ohio, southeast Michigan and northeast Indiana and a loan production office in Columbus, Ohio. First Insurance Group is a full-service insurance agency with five offices throughout northwest Ohio.

For more information, visit the company’s Web site at www.fdef.com.

Financial Statements and Highlights Follow -

Safe Harbor Statement

This news release may contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21 B of the Securities Act of 1934, as amended, which are intended to be safe harbors created thereby. Those statements may include, but are not limited to, all statements regarding intent, beliefs, expectations, projections, forecasts and plans of First Defiance Financial Corp. and its management, and specifically include statements regarding: changes in economic conditions, the nature, extent and timing of governmental actions and reforms, future movements of interest rates, the production levels of mortgage loan generation, the ability to continue to grow loans and deposits, the ability to benefit from a changing interest rate environment, the ability to sustain credit quality ratios at current or improved levels, the ability to sell real estate owned properties, continued strength in the market area for First Federal Bank of the Midwest, and the ability to grow in existing and adjacent markets. These forward-looking statements involve numerous risks and uncertainties, including those inherent in general and local banking, insurance and mortgage conditions, competitive factors specific to markets in which First Defiance and its subsidiaries operate, future interest rate levels, legislative and regulatory decisions or capital market conditions and other risks and uncertainties detailed from time to time in our Securities and Exchange Commission (SEC) filings, including our Annual Report on Form 10-K for the year ended December 31, 2014. One or more of these factors have affected or could in the future affect First Defiance's business and financial results in future periods and could cause actual results to differ materially from plans and projections. Therefore, there can be no assurances that the forward-looking statements included in this news release will prove to be accurate. In light of the significant uncertainties in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by First Defiance or any other persons, that our objectives and plans will be achieved. All forward-looking statements made in this news release are based on information presently available to the management of First Defiance. We assume no obligation to update any forward-looking statements.

As required by U.S. GAAP, First Defiance will evaluate the impact of subsequent events through the issuance date of its March 31, 2015 consolidated financial statements as part of its Quarterly Report on Form 10-Q to be filed with the SEC. Accordingly, subsequent events could occur that may cause First Defiance to update its critical accounting estimates and to revise its financial information from that which is contained in this news release.

                 
Consolidated Balance Sheets (Unaudited)
First Defiance Financial Corp.
           
March 31, December 31,
(in thousands)       2015       2014
 
Assets
Cash and cash equivalents
Cash and amounts due from depository institutions $ 38,472 $ 41,936
Interest-bearing deposits   43,000     71,000  
81,472

 

112,936
Securities

 

Available-for sale, carried at fair value 248,438 239,321
Held-to-maturity, carried at amortized cost   299     313  
248,737 239,634
 
Loans 1,684,518 1,646,786
Allowance for loan losses   (25,302 )   (24,766 )
Loans, net 1,659,216 1,622,020
Loans held for sale 9,544 4,535
Mortgage servicing rights 8,947 9,012
Accrued interest receivable 6,967 6,037
Federal Home Loan Bank stock 13,802 13,802
Bank Owned Life Insurance 47,221 47,013
Office properties and equipment 39,952 40,496
Real estate and other assets held for sale 6,392 6,181
Goodwill 61,525 61,525
Core deposit and other intangibles 2,178 2,395
Other assets   15,368     13,366  
Total Assets $ 2,201,321   $ 2,178,952  
 

Liabilities and Stockholders’ Equity

Non-interest-bearing deposits $ 370,997 $ 379,552
Interest-bearing deposits   1,401,696     1,381,261  
Total deposits 1,772,693 1,760,813
Advances from Federal Home Loan Bank 31,298 21,544
Notes payable and other interest-bearing liabilities 60,271 54,759
Subordinated debentures 36,083 36,083
Advance payments by borrowers for tax and insurance 1,199 2,309
Deferred Taxes 1,507 1,176
Other liabilities   25,153     22,763  
Total Liabilities 1,928,204 1,899,447
Stockholders’ Equity
Preferred stock - -
Common stock, net 127 127
Common stock warrant - 878
Additional paid-in-capital 125,271 136,266
Accumulated other comprehensive income 5,089 4,114
Retained earnings 205,300 200,600
Treasury stock, at cost   (62,670 )   (62,480 )
Total stockholders’ equity   273,117     279,505  
Total Liabilities and Stockholders’ Equity $ 2,201,321   $ 2,178,952  
 
                 
Consolidated Statements of Income (Unaudited)
First Defiance Financial Corp.
      Three Months Ended

March 31,

(in thousands, except per share amounts)       2015       2014
Interest Income:      
Loans $ 17,887 $ 16,651
Investment securities 1,692 1,527
Interest-bearing deposits 39 101
FHLB stock dividends   139   195
Total interest income 19,757 18,474
Interest Expense:

 

Deposits 1,272 1,358
FHLB advances and other 110 133
Subordinated debentures 147 146
Notes Payable   38   41
Total interest expense   1,567   1,678
Net interest income 18,190 16,796
Provision for loan losses   120   103
Net interest income after provision for loan losses 18,070 16,693
Non-interest Income:
Service fees and other charges 2,529 2,324
Mortgage banking income 1,775 1,247
Gain on sale of non-mortgage loans 36 3
Gain on sale of securities - -
Impairment on securities - -
Insurance commissions 3,139 3,030
Trust income 357 278
Income from Bank Owned Life Insurance 208 219
Other non-interest income   237   225
Total Non-interest Income 8,281 7,326
Non-interest Expense:
Compensation and benefits 8,922 8,472
Occupancy 1,764 1,588
FDIC insurance premium 351 385
Financial institutions tax 481 495
Data processing 1,523 1,365
Amortization of intangibles 217 289
Other non-interest expense   3,639   4,067
Total Non-interest Expense   16,897   16,661
Income before income taxes 9,454 7,358
Income taxes   2,853   2,179
Net Income $ 6,601 $ 5,179
 
 
Earnings per common share:
Basic $ 0.71 $ 0.53
Diluted $ 0.69 $ 0.51
 
Average Shares Outstanding:
Basic 9,234 9,681
Diluted 9,611 10,108
 
                         
Financial Summary and Comparison (Unaudited)
First Defiance Financial Corp.
      Three Months Ended

March 31,

(dollars in thousands, except per share data)       2015       2014       % change
Summary of Operations            
 
Tax-equivalent interest income (1) $ 20,221 $ 18,900 7.0 %
Interest expense 1,567 1,678 (6.6 )
Tax-equivalent net interest income (1) 18,654 17,222 8.3
Provision for loan losses 120 103 16.5
Tax-equivalent NII after provision for loan loss (1) 18,534 17,119 8.3
Investment Securities gains - - NM
Non-interest income (excluding securities gains/losses) 8,281 7,326 13.0
Non-interest expense 16,897 16,661 1.4
Income taxes 2,853 2,179 30.9
Net Income 6,601 5,179 27.5
Tax equivalent adjustment (1)         464           426         8.9  
At Period End
Assets 2,201,321 2,163,659 1.7
Earning assets 1,999,601 1,965,225 1.7
Loans 1,684,518 1,563,953 7.7
Allowance for loan losses 25,302 24,783 2.1
Deposits 1,772,693 1,760,617 0.7
Stockholders’ equity         273,117           274,877         (0.6 )
Average Balances
Assets 2,179,576 2,146,369 1.5
Earning assets 1,958,463 1,937,145 1.1
Loans 1,647,059 1,544,902 6.6
Deposits and interest-bearing liabilities 1,871,871 1,852,322 1.1
Deposits 1,760,383 1,741,237 1.1
Stockholders’ equity 279,917 273,745 2.3
Stockholders’ equity / assets         12.84 %         12.75 %       0.7  
Per Common Share Data
Net Income
Basic $ 0.71 $ 0.53 34.0
Diluted 0.69 0.51 35.3
Dividends 0.175 0.15 16.7
Market Value:
High $ 34.64 $ 28.23 22.7
Low 29.05 24.24 19.8
Close 32.82 27.12 21.0
Common Book Value 29.53 28.38 4.0
Tangible Common Book Value 22.64 21.68 4.5
Shares outstanding, end of period (000)         9,248           9,653         (4.2 )
Performance Ratios (annualized)
Tax-equivalent net interest margin (1) 3.88 % 3.61 % 7.4
Return on average assets 1.23 % 0.98 % 25.5
Return on average equity 9.56 % 7.67 % 24.6
Efficiency ratio (2) 62.73 % 67.87 % (7.6 )
Effective tax rate 30.18 % 29.61 % 1.9
Dividend payout ratio (basic)         24.65 %         28.30 %       (12.9 )
 

(1)

 

Interest income on tax-exempt securities and loans has been adjusted to a tax-equivalent basis using the statutory federal income tax rate of 35%

(2)

Efficiency ratio = Non-interest expense divided by sum of tax-equivalent net interest income plus non-interest income, excluding securities gains or losses, net.

NM Percentage change not meaningful
 
                 
Income from Mortgage Banking
           
Revenue from sales and servicing of mortgage loans consisted of the following:
 
Three Months Ended

March 31,

(dollars in thousands)         2015           2014  
 
Gain from sale of mortgage loans $ 1,285 $ 641
Mortgage loan servicing revenue (expense):
Mortgage loan servicing revenue 875 905
Amortization of mortgage servicing rights (411 ) (292 )
Mortgage servicing rights valuation adjustments   26           (7 )
  490           606  
Total revenue from sale and servicing of mortgage loans $ 1,775         $ 1,247  
 
                                     
Yield Analysis
First Defiance Financial Corp.
    Three Months Ended March 31,
(dollars in thousands)
2015     2014
Average         Yield Average         Yield
Balance Interest(1) Rate(2) Balance Interest(1) Rate(2)
Interest-earning assets:
Loans receivable $ 1,647,059 $ 17,932 4.42 % $ 1,544,902 $ 16,672 4.38 %
Securities 241,023 2,111 3.67 % 202,275 1,932 3.93 %
Interest Bearing Deposits 56,579 39 0.28 % 172,666 101 0.24 %
FHLB stock   13,802   139 4.08 %   17,302   195 4.57 %
Total interest-earning assets 1,958,463 20,221 4.20 % 1,937,145 18,900 3.96 %
Non-interest-earning assets   221,113   209,224
Total assets $ 2,179,576 $ 2,146,369
Deposits and Interest-bearing liabilities:
Interest bearing deposits $ 1,394,262 $ 1,272 0.37 % $ 1,399,951 $ 1,358 0.39 %
FHLB advances and other 21,490 110 2.08 % 22,363 133 2.41 %
Subordinated debentures 36,129 147 1.65 % 36,134 146 1.64 %
Notes payable   53,869   38 0.29 %   52,588   41 0.32 %
Total interest-bearing liabilities 1,505,750 1,567 0.42 % 1,511,036 1,678 0.45 %
Non-interest bearing deposits   366,121   - -   341,286   - -
Total including non-interest-bearing demand deposits 1,871,871 1,567 0.34 % 1,852,322 1,678 0.37 %
Other non-interest-bearing liabilities   27,788   20,302
Total liabilities 1,899,659 1,872,624
Stockholders' equity   279,917   273,745
Total liabilities and stockholders' equity $ 2,179,576   $ 2,146,369  
Net interest income; interest rate spread $ 18,654 3.78 % $ 17,222 3.51 %
Net interest margin (3) 3.88 % 3.61 %
Average interest-earning assets to average interest bearing liabilities 130 % 128 %
 

(1)

 

Interest on certain tax exempt loans and securities is not taxable for Federal income tax purposes. In order to compare the tax-exempt yields on these assets to taxable yields, the interest earned on these assets is adjusted to a pre-tax equivalent amount based on the marginal corporate federal income tax rate of 35%.

(2)

Annualized

(3)

Net interest margin is net interest income divided by average interest-earning assets.

 
                               
Selected Quarterly Information
First Defiance Financial Corp.
                   
(dollars in thousands, except per share data)     1st Qtr 2015     4th Qtr 2014     3rd Qtr 2014     2nd Qtr 2014     1st Qtr 2014
Summary of Operations
Tax-equivalent interest income (1) $ 20,221 $ 20,174 $ 19,751 $ 19,221 $ 18,900
Interest expense 1,567 1,612 1,623 1,645 1,678
Tax-equivalent net interest income (1) 18,654 18,562 18,128 17,576 17,222
Provision for loan losses 120 162 406 446 103
Tax-equivalent NII after provision for loan losses (1) 18,534 18,400 17,722 17,130 17,119
Investment securities gains, net of impairment - 1 460 471 -
Non-interest income (excluding securities gains/losses) 8,281 7,341 8,896 7,146 7,326
Non-interest expense 16,897 16,969 16,771 16,357 16,661
Income taxes 2,853 1,957 2,773 2,254 2,179
Net income 6,601 6,355 7,069 5,689 5,179
Tax equivalent adjustment (1)       464         461         465         447         426  
At Period End
Total assets $ 2,201,321 $ 2,178,952 $ 2,151,079 $ 2,151,490 $ 2,163,659
Earning assets 1,999,601 1,975,757 1,954,496 1,949,729 1,965,225
Loans 1,684,518 1,646,786 1,636,266 1,581,984 1,563,953
Allowance for loan losses 25,302 24,766 24,567 24,627 24,783
Deposits 1,772,693 1,760,813 1,730,645 1,741,812 1,760,617
Stockholders’ equity 273,117 279,505 278,233 276,449 274,877
Stockholders’ equity / assets 12.41 % 12.83 % 12.93 % 12.85 % 12.70 %
Goodwill       61,525         61,525         61,525         61,525         61,525  
Average Balances
Total assets $ 2,179,576 $ 2,184,792 $ 2,153,226 $ 2,165,486 $ 2,146,369
Earning assets 1,958,463 1,964,074 1,934,651 1,952,440 1,937,145
Loans 1,647,059 1,615,657 1,586,652 1,551,799 1,544,902
Deposits and interest-bearing liabilities 1,871,871 1,879,918 1,853,271 1,865,824 1,852,322
Deposits 1,760,383 1,764,908 1,738,494 1,756,098 1,741,237
Stockholders’ equity 279,917 278,944 276,968 276,490 273,745
Stockholders’ equity / assets       12.84 %       12.77 %       12.86 %       12.77 %       12.75 %
Per Common Share Data
Net Income:
Basic $ 0.71 $ 0.68 $ 0.75 $ 0.59 $ 0.53
Diluted 0.69 0.65 0.71 0.57 0.51
Dividends 0.18 0.18 0.15 0.15 0.15
Market Value:
High $ 34.64 $ 35.70 $ 29.00 $ 29.00 $ 28.23
Low 29.05 26.95 26.99 26.50 24.24
Close 32.82 34.06 27.01 28.70 27.12
Common Book Value 29.53 30.17 29.60 28.96 28.38
Shares outstanding, end of period (in thousands)       9,248         9,235         9,371         9,515         9,653  
Performance Ratios (annualized)
Tax-equivalent net interest margin (1) 3.88 % 3.76 % 3.73 % 3.62 % 3.61 %
Return on average assets 1.23 % 1.15 % 1.30 % 1.05 % 0.98 %
Return on average equity 9.56 % 9.04 % 10.13 % 8.25 % 7.67 %
Efficiency ratio (2) 62.73 % 65.51 % 62.06 % 66.16 % 67.87 %
Effective tax rate 30.18 % 23.54 % 28.18 % 28.38 % 29.61 %
Common dividend payout ratio (basic)       24.65 %       25.74 %       20.00 %       25.42 %       28.30 %
 

(1)

 

Interest income on tax-exempt securities and loans has been adjusted to a tax-equivalent basis using the statutory federal income tax rate of 35%

(2)

Efficiency ratio = Non-interest expense divided by sum of tax-equivalent net interest income plus non-interest income, excluding securities gains, net.

                               
Selected Quarterly Information
First Defiance Financial Corp.
           
(dollars in thousands, except per share data)     1st Qtr 2015   4th Qtr 2014   3rd Qtr 2014   2nd Qtr 2014   1st Qtr 2014
Loan Portfolio Composition
One to four family residential real estate $ 203,558 $ 206,437 $ 209,135 $ 199,886 $ 196,940
Construction 125,144 112,385 116,809 108,478 82,049
Commercial real estate 876,476 840,488 834,443 801,923 809,071
Commercial 395,378 399,730 392,465 390,055 380,144
Consumer finance 14,967 15,466 16,616 15,800 16,346
Home equity and improvement   110,755         111,813         111,151         108,460         106,632  
Total loans 1,726,278 1,686,319 1,680,619 1,624,602 1,591,182
Less:
Loans in process 40,833 38,653 43,548 41,874 26,487
Deferred loan origination fees 927 880 805 744 742
Allowance for loan loss   25,302         24,766         24,567         24,627         24,783  
Net Loans $ 1,659,216       $ 1,622,020       $ 1,611,699       $ 1,557,357       $ 1,539,170  
                               
Allowance for loan loss activity
Beginning allowance $ 24,766 $ 24,567 $ 24,627 $ 24,783 $ 24,950
Provision for loan losses 120 162 406 446 103
Credit loss charge-offs:
One to four family residential real estate 78 61 95 42 228
Commercial real estate 155 505 246 39 228
Commercial 2 212 1,272 973 525
Consumer finance 3 1 16 12 11
Home equity and improvement   43         87         42         80         184  
Total charge-offs 281 866 1,671 1,146 1,176
Total recoveries   697         903         1,205         544         906  
Net charge-offs (recoveries)   (416 )       (37 )       466         602         270  
Ending allowance $ 25,302       $ 24,766       $ 24,567       $ 24,627       $ 24,783  
                               
Credit Quality
Total non-performing loans (1) $ 18,703 $ 24,130 $ 22,525 $ 24,863 $ 26,774
Real estate owned (REO)   6,392         6,181         5,326         5,554         6,028  
Total non-performing assets (2) $ 25,095       $ 30,311       $ 27,851       $ 30,417       $ 32,802  
Net charge-offs (recoveries) (416 ) (37 ) 466 602 270
 
Restructured loans, accruing (3) 19,616 24,686 26,579 26,975 26,654
 
Allowance for loan losses / loans 1.50 % 1.50 % 1.50 % 1.56 % 1.58 %
Allowance for loan losses / non-performing assets 100.82 % 81.71 % 88.21 % 80.96 % 75.55 %
Allowance for loan losses / non-performing loans 135.28 % 102.64 % 109.07 % 99.05 % 92.56 %
Non-performing assets / loans plus REO 1.48 % 1.83 % 1.70 % 1.92 % 2.09 %
Non-performing assets / total assets 1.14 % 1.39 % 1.29 % 1.41 % 1.52 %
Net charge-offs / average loans (annualized) -0.10 % -0.01 % 0.12 % 0.16 % 0.07 %
                               
Deposit Balances
Non-interest-bearing demand deposits $ 370,997 $ 379,552 $ 340,575 $ 355,268 $ 338,412
Interest-bearing demand deposits and money market 737,533 727,729 739,292 717,506 740,783
Savings deposits 215,590 203,673 197,464 200,626 199,361
Retail time deposits less than $100,000 286,890 286,904 289,326 299,288 309,758
Retail time deposits greater than $100,000   161,683         162,955         163,988         169,124         172,303  
Total deposits $ 1,772,693       $ 1,760,813       $ 1,730,645       $ 1,741,812       $ 1,760,617  
 

(1)

 

Non-performing loans consist of non-accrual loans.

(2)

Non-performing assets are non-performing loans plus real estate and other assets acquired by foreclosure or deed-in-lieu thereof.

(3)

Accruing restructured loans are loans with known credit problems that are not contractually past due and therefore are not included in non-performing loans.

 
                                 
Loan Delinquency Information
First Defiance Financial Corp.
                       
 

 

 

30 to 89 days Non Accrual
(dollars in thousands)      

Total Balance

     

Current

      past due       Loans
 
March 31, 2015                                
One to four family residential real estate $ 203,558 $ 199,758 $ 559 $ 3,241
Construction 125,144 125,144 - -
Commercial real estate 876,476 863,611 1,466 11,399
Commercial 395,378 391,631 234 3,513
Consumer finance 14,967 14,934 17 16
Home equity and improvement   110,755         110,092         129         534
Total loans $ 1,726,278       $ 1,705,170       $ 2,405       $ 18,703
 
December 31, 2014                                
One to four family residential real estate $ 206,437 $ 201,931 $ 1,174 $ 3,332
Construction 112,385 112,385 - -
Commercial real estate 840,488 824,770 544 15,174
Commercial 399,730 394,671 66 4,993
Consumer finance 15,466 15,330 124 12
Home equity and improvement   111,813         109,993         1,201         619
Total loans $ 1,686,319       $ 1,659,080       $ 3,109       $ 24,130
 
March 31, 2014                                
One to four family residential real estate $ 196,940 $ 192,942 $ 1,024 $ 2,974
Construction 82,049 82,049 - -
Commercial real estate 809,071 792,289 1,100 15,682
Commercial 380,144 371,829 592 7,723
Consumer finance 16,346 16,300 46 -
Home equity and improvement   106,632         105,627         610         395
Total loans $ 1,591,182       $ 1,561,036       $ 3,372       $ 26,774
 

Contacts

First Defiance Financial Corp.
Donald P. Hileman, 419-782-5104
President and CEO
dhileman@first-fed.com

Release Summary

First Defiance Financial Corp. Announces 2015 First Quarter Earnings

Contacts

First Defiance Financial Corp.
Donald P. Hileman, 419-782-5104
President and CEO
dhileman@first-fed.com