HELENA, Mont., Jan. 15, 2009 (GLOBE NEWSWIRE) -- Eagle Bancorp ("Eagle") (OTCBB:EBMT), the stock holding company of American Federal Savings Bank (the "Bank"), reported net income of $524,000, or $0.49 per share ($0.43 per share diluted), for the three months ended December 31, 2008, and declared a cash dividend of $0.255 per share. Earnings for the quarter increased by 139.27% from the $219,000 earned for the quarter ended December 31, 2007. Earnings for the six month period ended December 31, 2008 were $424,000, or $0.40 per share ($0.35 per share diluted), a decrease of $259,000 or 37.92%, compared to $683,000 for the six month period ended December 31, 2007. "We are pleased that our performance for the second quarter was so robust and that our net interest income showed significant growth for this quarter and for the six month period ended December 31, 2008. Excluding the losses in market value stemming from our ownership of Fannie Mae and Freddie Mac preferred stock, our performance on an operational basis continues to be strong," said CEO Pete Johnson.
The increase in net income for the second quarter was the result of an increase in net interest income of $591,000, and an increase in noninterest income of $175,000. Those increases were partially offset by an increase in noninterest expense of $269,000. Eagle's tax provision was $158,000 higher in the current quarter.
Noninterest income increased substantially due to the prior period's loss in market value on investments in certain preferred stock, issued by Fannie Mae and Freddie Mac. For the quarter ended December 31, 2008 these losses were $47,000 while the prior period's losses were $390,000. This increase was partially offset by a decrease in mortgage loan servicing fees of $220,000, which includes a provision against the valuation of mortgage servicing rights of $239,000.
Eagle's annualized return on assets was 0.73% and its annualized return on equity was 8.54% for the quarter, compared with 0.35% and 3.50%, respectively, for the same quarter in 2007.
Total interest and dividend income increased $449,000 to $3,943,000 for the quarter ended December 31, 2008 from $3,494,000 for the quarter ended December 31, 2007. This was due primarily to an increase in interest and fees on loans of $204,000. Lower funding costs caused total interest expense to decrease by $142,000 to $1.58 million for the quarter ended December 31, 2008 from $1.72 million for the quarter ended December 31, 2007. Interest expense on deposits decreased $341,000 and interest expense on borrowed money increased $199,000.
For the six month period ended December 31, 2008 earnings were $424,000, or $0.40 per share ($0.35 per share diluted), as noted above. The decrease in net income for the period was the result of a decrease in noninterest income of $913,000, an increase in noninterest expense of $450,000, offset by an increase in net interest income of $1.08 million. Eagle's tax provision was $20,000 lower in the current period. The decrease in noninterest income was primarily attributable to the recognition of a decline in value of $1.29 million on Fannie Mae and Freddie Mac preferred stock, which primarily occurred during the first quarter of the fiscal year. Also, the mortgage servicing fees decreased $213,000, which includes a provision against the valuation of mortgage servicing rights of $239,000, as noted above. The increase in noninterest expense was primarily due to an increase in salaries and employee benefits of $238,000 resulting from merit raises, inflationary costs, and a slightly larger staff. Eagle's annualized return on assets was 0.30% and its annualized return on equity was 3.46%, compared with 0.55% and 5.55% respectively for the same six-month period in 2007.
Total assets increased by $7.42 million, or 2.65%, to $287.99 million at December 31, 2008 from $279.91 million at June 30, 2008. Loans receivable increased $10.44 million, or 6.21%, to $178.58 million from $168.15 million. Loans held-for-sale decreased to $1.87 million from $7.37 million. Deposits increased $2.43 million, or 1.36%, to $181.28 million at December 31, 2008 from $178.85 million at June 30, 2008. Advances from the Federal Home Loan Bank and other borrowings increased $4.68 million, or 7.16%, to $69.89 million from $65.22 million, while federal fund purchases increased from $3.0 million to $3.9 million. Total stockholders' equity decreased $713,000 or 2.78%, to $24.92 million at December 31, 2008 from $25.63 million at June 30, 2008. This was a result of the net income for the period of $524,000 offset by an increase in accumulated other comprehensive loss of $826,000 (mainly due to an increase in net unrealized loss on securities available-for-sale), and by dividends paid and purchases of treasury stock.
Eagle's Board of Directors declared a quarterly cash dividend of $0.255 per share for the second quarter of Eagle's fiscal year. The dividend is payable February 20, 2009 to shareholders of record at the close of business on January 30, 2009.
American Federal Savings Bank was formed in 1922 and is headquartered in Helena, Montana. It has additional branches in Butte, Bozeman and Townsend. Eagle's common stock trades on the OTC Bulletin Board under the symbol "EBMT." Eagle is a subsidiary of Eagle Financial MHC, a federal mutual holding company formed in 2000, which owns approximately 59% of Eagle Bancorp's outstanding common stock.
This release may contain certain 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. Eagle intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and is including this statement for purposes of these safe harbor provisions.
Financial highlights for Eagle Bancorp follow.
EAGLE BANCORP AND SUBSIDIARY
(consolidated)
(Dollars in Thousands)
December 31, June 30,
2008 2008
(Unaudited) (Audited)
ASSETS
Cash and due from banks 5,526 3,541
Interest-bearing deposits with banks 127 549
---------- ---------
Total cash and cash equivalents 5,653 4,090
Securities available-for-sale,
at market value 77,029 78,417
Securities held-to-maturity, at cost 381 697
Preferred stock - SFAS 159, at market value 35 1,321
Federal Home Loan Bank stock, at cost 1,925 1,715
Investment in Eagle Bancorp Statutory Trust I 155 155
Mortgage loans held-for-sale 1,871 7,370
Loans receivable, net of deferred loan fees
and allowance for loan losses of $340 at
December 31, 2008 and $300 at June 30, 2008 178,584 168,149
Accrued interest and dividends receivable 1,433 1,426
Mortgage servicing rights, net 1,512 1,652
Premises and equipment, net 10,848 8,080
Cash surrender value of life insurance 6,403 6,285
Real estate acquired in settlement of loans,
net of allowance for losses -- --
Other assets 1,494 550
--------- ---------
Total assets 287,323 279,907
========== =========
LIABILITIES
Deposit accounts:
Noninterest bearing 12,902 14,617
Interest bearing 168,378 164,234
---------- ---------
Total deposits 181,280 178,851
Accrued expenses and other liabilities 2,178 2,045
Federal funds purchased 3,900 3,000
FHLB advances and other borrowings 69,889 65,222
Subordinated debentures 5,155 5,155
---------- ---------
Total liabilities 262,402 254,273
EQUITY
Preferred stock (no par value, 1,000,000 shares
authorized, none issued or outstanding) -- --
Common stock (par value $0.01 per share;
9,000,000 shares authorized; 1,223,572
shares issued; 1,075,312 and 1,076,072
shares outstanding at December 31, 2008
and June 30, 2008, respectively) 12 12
Additional paid-in capital 4,526 4,487
Unallocated common stock held by employee
stock ownership plan ("ESOP") (37) (55)
Treasury stock, at cost (148,260 and 147,500
shares at December 31, 2008 and
June 30, 2008, respectively) (5,034) (5,013)
Retained earnings 27,102 27,025
Accumulated other comprehensive loss (1,648) (822)
---------- ---------
Total equity 24,921 25,634
Total liabilities and equity 287,323 279,907
========== =========
EAGLE BANCORP AND SUBSIDIARY
Consolidated Statements of Income
(In Thousands, except for Per Share Data)
Three Months Ended Six Months Ended
December 31, December 31,
-------------------- ---------------------
2008 2007 2008 2007
--------- --------- --------- ---------
Interest and Dividend
Income:
Interest and fees on
loans $2,955 $2,751 5,792 5,419
Securities
available-for-sale 977 704 1,940 1,426
Securities
held-to-maturity 5 9 10 18
Interest on deposits
with banks 1 27 5 34
FHLB Stock dividends 5 3 12 5
--------- --------- --------- ---------
Total interest and
dividend income 3,943 3,494 7,759 6,902
--------- --------- --------- ---------
Interest Expense:
Deposits 830 1,171 1,692 2,356
Advances and other
borrowings 670 471 1,313 910
Subordinated debentures 75 75 150 150
--------- --------- --------- ---------
Total interest expense 1,575 1,717 3,155 3,416
--------- --------- --------- ---------
Net Interest Income 2,368 1,777 4,604 3,486
Loan loss provision 34 0 34 0
--------- --------- --------- ---------
Net interest income
after loan loss
provision 2,334 1,777 4,570 3,486
--------- --------- --------- ---------
Noninterest income:
Service charges on
deposit accounts 181 190 371 356
Net gain on sale of loans 238 183 421 382
Mortgage loan servicing
fees (83) 137 57 270
Net gain on sale of
available-for-sale
securities 0 0 57 0
Net gain (loss) on
securities FAS 159 (47) (390) (1,286) (431)
Other 155 149 320 276
--------- --------- --------- ---------
Total noninterest
income 444 269 (60) 853
--------- --------- --------- ---------
Noninterest expense:
Salaries and employee
benefits 1,146 1,008 2,192 1,954
Occupancy expenses 136 130 285 265
Furniture and equipment
depreciation 65 70 132 141
In-house computer
expense 101 84 174 158
Advertising 103 70 194 133
Amortization of mtg
servicing fees 66 75 137 141
Federal insurance
premiums 9 5 16 10
Postage 45 33 78 56
Legal,accounting, and
examination fees 65 65 113 121
Consulting fees 19 7 62 22
ATM processing 14 13 28 27
Other 287 227 494 427
Total noninterest --------- --------- --------- ---------
expense 2,056 1,787 3,905 3,455
--------- --------- --------- ---------
Income before provision
for income taxes 722 259 605 884
--------- --------- --------- ---------
Provision for income
taxes 198 40 181 201
--------- --------- --------- ---------
Net income $524 $219 $424 $683
========= ========= ========= =========
Basic earnings
per share $0.49 $0.20 $0.40 $0.64
========= ========= ========= =========
Diluted earnings
per share $0.43 $0.18 $0.35 $0.56
========= ========= ========= =========
Weighted average shares
outstanding (basic
eps) 1,069,952 1,070,862 1,069,581 1,071,651
========= ========= ========= =========
Weighted average shares
outstanding (diluted
eps) 1,218,212 1,213,612 1,217,635 1,213,035
========= ========= ========= =========