SPENCER, Ind.--(BUSINESS WIRE)--Home Financial Bancorp (“Company”) (OTCPink: HWEN), an Indiana corporation which is the holding company for Our Community Bank, (“Bank”) based in Spencer, Indiana, announces unaudited results for the fourth quarter and twelve months ended June 30, 2019.
Fourth Quarter Highlights:
- Net interest income increased 9%, or $60,000;
- Non-interest expense decreased 24%, or $231,000;
- Net income was $113,000, compared to year-earlier net loss of $84,000.
Twelve Month Highlights:
- Shareholders’ equity was $8.9 million, or 12.4% of total assets;
- Non-interest income increased 15%, or $65,000;
- Non-interest expense decreased 7%, or $200,000;
- Net income increased 97% to $314,000, from $159,000;
For the quarter ended June 30, 2019, the Company reported net income of $113,000, or $.10 basic and diluted earnings per common share. For the same period last year, the Company reported net loss of $84,000, or ($.07) basic and diluted earnings per common share. Excluding $265,000 of non-recurring costs and related tax benefit, net income for fourth quarter 2018 would have been $100,000 or $.09 basic and diluted earnings per common share. The improvement in earnings resulted from increased net interest income and substantially lower non-interest expense.
Total interest income for the quarter increased $95,000, or 12%. Total interest expense increased $35,000, or 25%. Consequently, net interest income before provisions for loan losses increased $60,000, or 9% for the three months ended June 30, 2019, compared to the same quarter in 2018.
Provision for loan losses was $17,000 during fourth quarter 2019, compared to $12,000 for the same period a year earlier. Net loan losses totaled $20,000 for the most recent quarter, and were $4,000 a year ago. A regular analysis of the allowance for loan losses indicated the reserve was adequate at June 30, 2019. This analysis included reviewing changes in volume, composition and quality of the loan portfolio, as well as actual loan loss experience.
Non-interest income increased $22,000 or 19%, to $140,000 for the three months ended June 30, 2019. Non-interest income was $118,000 for the same period a year earlier. Service charges on deposit accounts increased $12,000, or 24% compared to the same period in 2018.
Non-interest expense decreased $231,000, or 24%, to $713,000. A number of non-recurring expenses resulted in high non-interest expense during fourth quarter 2018. One-time data system conversion-related charges and associated expenses totaled $182,000. In addition, during the quarter-ended June 30, 2018, the Company recognized $83,000 of impairment and depreciation expense for assets no longer in use. Contributing to the overall reduction in non-interest expense for the current quarter, computer processing fees decreased $127,000, or 59% compared to the same quarter a year earlier.
For the twelve-month period ended June 30, 2019, the Company reported net income of $314,000, or $.27 basic and diluted earnings per common share. The Company reported earnings of $159,000 or $.14 basic and diluted earnings per common share for fiscal 2018. Excluding $265,000 of non-recurring expenses and related tax benefit, net income would have been $346,000 or $.30 basic and diluted earnings per common share for fiscal 2018.
Net interest income before provisions for loan losses decreased $37,000, or 1% for fiscal year 2019. Total interest income increased $184,000, or 6%, but was substantially offset by a $221,000, or 45% increase in interest expense for the year. Loan loss provisions increased to $66,000, compared to $52,000 for the prior year. Net loan charge-offs totaled $47,000 for fiscal year 2019, compared to $35,000 for fiscal year 2018.
Non-interest income increased $65,000 or 15%, to $503,000 for fiscal 2019. Service charges on deposit accounts increased $58,000, or 32%, compared to the prior year. Non-interest expense decreased $200,000 or 7%, to $2.8 million. As mentioned above, non-recurring expenses led to higher non-interest expense in 2018. Contributing to the overall reduction in non-interest expense for 2019 compared to 2018, computer processing fees decreased $85,000 or 20%, and salaries and employee benefits decreased $51,000, or 4%.
At June 30, 2019, total assets were $72.0 million, compared to $73.3 million at June 30, 2018. During the twelve months ended June 30, 2019, loans outstanding increased $884,000, or 2%, to $53.2 million. Cash and cash equivalents and interest-bearing time deposits decreased from $6.5 million at June 30, 2018 to $5.3 million at June 30, 2019. Investment securities decreased $1.1 million, or 11% during the year.
Loans delinquent 90 days or more decreased 55% to $386,000, and equaled 0.7% of total loans at June 30, 2019. A year earlier, loans delinquent 90 days or more totaled $857,000 and 1.6% of total loans. Other real estate owned (“OREO”) and repossessed property was $109,000 at June 30, 2019, compared to $53,000 at June 30, 2018.
Allowances for loan losses were $504,000 at June 30, 2019, and $485,000 at June 30, 2018. Loan loss allowances equaled 0.95% of total loans at June 30, 2019, and 0.93% of total loans a year earlier. Periodic provisions to allowances for loan losses reflect management’s view of risk in the Company’s entire loan portfolio due to a number of dynamic factors, including current economic conditions, quantity of outstanding loans, and loan delinquency trends. Management considered the level of allowances for loan losses at June 30, 2019 adequate to cover probable incurred losses inherent in the loan portfolio at that date.
At June 30, 2019, total deposits were $53.1 million, compared to $50.1 million twelve months earlier. Total borrowings decreased 32% to $9.5 million at June 30, 2019, compared to $14.0 million a year earlier.
Shareholders’ equity was $8.9 million, or 12.4% of total assets at June 30, 2019, compared to $8.7 million, or 11.9% of total assets at June 30, 2018. Factors impacting shareholder equity during fiscal 2019 included net income, four quarterly cash dividends totaling $.16 per share, and a change from accumulated other comprehensive loss of $91,000 at June 30, 2018 to $37,000 accumulated other comprehensive gain at June 30, 2019. At June 30, 2019, the Company’s book value per share was $7.70 based on 1,155,594 shares outstanding. At June 30, 2018, book value was $7.48 per share based on 1,166,002 shares outstanding. The last reported price per share on June 30, 2019 was $6.70.
Home Financial Bancorp and Our Community Bank, an FDIC-insured, Indiana stock commercial bank, operate from headquarters in Spencer, Indiana, and a branch office in Cloverdale, Indiana. Additional information concerning Home Financial Bancorp and its subsidiaries is available at www.hfbancorp.com or www.ocbconnect.com.
HOME FINANCIAL BANCORP |
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(Unaudited) |
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Consolidated Financial Highlights |
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(Dollars in thousands, except per share and book value amounts) |
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FOR THREE MONTHS ENDED JUNE 30: |
2019 |
2018 |
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Net Interest Income |
$714 |
$654 |
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Provision for Loan Losses |
17 |
12 |
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Non-interest Income |
140 |
118 |
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Non-interest Expense |
713 |
944 |
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Income Tax (Benefit) |
11 |
(100) |
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Net Income |
113 |
(84) |
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|
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Basic and Diluted (Loss) Earnings Per Share: |
$.10 |
($.07) |
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Average Shares Outstanding - Basic |
1,155,594 |
1,165,594 |
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Average Shares Outstanding - Diluted |
1,155,594 |
1,165,594 |
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|
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FOR TWELVE MONTHS ENDED JUNE 30: |
2019 |
2018 |
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Net Interest Income |
$2,648 |
$2,685 |
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Provision for Loan Losses |
66 |
52 |
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Non-interest Income |
503 |
438 |
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Non-interest Expense |
2,775 |
2,975 |
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Income Tax (Benefit) |
(4) |
(63) |
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Net Income |
314 |
159 |
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|
|
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Basic and Diluted Earnings Per Share: |
$.27 |
$.14 |
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Average Shares Outstanding - Basic |
1,160,034 |
1,165,526 |
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Average Shares Outstanding - Diluted |
1,160,034 |
1,165,713 |
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|
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June 30, |
June 30, |
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2018 |
2019 |
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Total Assets |
$72,011 |
$73,347 |
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Total Loans |
53,232 |
52,348 |
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Allowance for Loan Losses |
504 |
485 |
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Total Deposits |
53,081 |
50,133 |
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Borrowings |
9,500 |
14,000 |
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Shareholders’ Equity |
8,900 |
8,717 |
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|
|
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90-days Past Due Loans and OREO |
495 |
910 |
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90-days Past Due Loans |
386 |
857 |
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|
|
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90-days Past Due Loans and OREO to Total Assets |
0.69% |
1.24% |
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90-days Past Due Loans to Total Loans |
0.73% |
1.64% |
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|
|
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Book Value Per Share* |
$7.70 |
$7.48 |
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*Based on 1,155,594 Shares at June 30, 2019 and 1,166,002 at June 30, 2018.