MILLINGTON, N.J., May 4, 2009 (GLOBE NEWSWIRE) -- MSB Financial Corp. (Nasdaq:MSBF) (the "Company"), the holding company for Millington Savings Bank (the "Bank"), reported net income of $116,000 for the three months ended March 31, 2009, compared to $170,000 for the quarter ended March 31, 2008, representing a decrease of $54,000 or 31.8%. For the nine months ended March 31, 2009, the Company reported net income of $420,000, compared to net income of $530,000 for the nine month period ended March 31, 2008, a decrease of $110,000 or 20.8%. Both reporting periods reflect increases in the provision for loan losses and FDIC insurance expense. Compensation expense also increased for both the three and nine months ended March 31, 2009, compared to the same periods in 2008 primarily as a result of the implementation of a stock option plan in May 2008. In addition, the nine month period ended March 31, 2009 reflects expenses associated with the opening of the Bank's new Bernardsville location in late summer 2008 and an unrealized loss of $66,000 on the Bank's trading securities portfolio.
Net interest income for the three and nine months ended March 31, 2009 increased to $2.2 million and $6.5 million, respectively, from $1.9 million and $5.6 million for the three and nine months ended March 31, 2008. For the three months ended March 31, 2009, the yield on interest earning assets was 5.37%, a decrease of 62 basis points when compared to the same period in 2008. For the nine months ended March 31, 2009, the yield on interest earning assets was 5.54%, a decrease of 54 basis points when compared to the same period in 2008. Correspondingly, the rate on interest-bearing liabilities for the three months ended March 31, 2009 was 2.80%, a decrease of 94 basis points when compared to the same period in 2008. For the nine months ended March 31, 2009, the rate on interest-bearing liabilities was 3.03%, a decrease of 85 basis points when compared to the same period in 2008. The net interest margin increased to 2.85% for the three months ended March 31, 2009, compared to 2.75% for the three months ended March 31, 2008, an increase of 10 basis points. The net interest margin increased to 2.88% for the nine months ended March 31, 2009, compared to 2.73% for the nine months ended March 31, 2008, an increase of 15 basis points. The reduction in interest-bearing liability rates, partially offset by a lesser reduction in interest-earning assets yields, resulted in the higher levels of net interest income and net interest margin.
The loan loss provision for the three and nine months ended March 31, 2009 was $91,000 and $223,000 respectively, compared to $40,000 and $95,000 for the same periods ended March 31, 2008. The Bank's management reviews the level of the allowance for loan losses on a quarterly basis and establishes the provision for loan losses based upon the volume and types of lending, delinquency levels, loss experience, the amount of impaired and classified loans, economic conditions and other factors related to the collectability of the loan portfolio. The provision was increased primarily due to growth in the loan portfolio, increased non-performing loans and local economic conditions.
Non-interest income for the quarter ended March 31, 2009 totaled $104,000, a decrease of $15,000 or 12.6% compared to the same period in 2008. For the nine months ended March 31, 2009, non-interest income totaled $378,000, a decrease of $65,000, or 14.7%, when compared to the same period in 2008. The decrease for the three month period ended March 31, 2009, was primarily attributable to a decrease in fees and service charges, whereas, the decrease for the nine months ended March 31, 2009 was primarily attributable to unrealized losses in the trading security portfolio.
Non-interest expense was $2.0 million for the quarter ended March 31, 2009, an increase of 16.7% compared to $1.7 million for the three months ended March 31, 2008. For the nine months ended March 31, 2009, non-interest expense totaled $6.0 million, compared to $5.2 million for the nine months ended March 31, 2008, an increase of 15.5%. Salaries and benefits expense increased due to normal salary increases and the implementation of our stock option plan in May 2008. Occupancy, equipment, and advertising expense increased as the result of the Bank opening its Bernardsville branch location. Other expense increased primarily due to an increase in FDIC expense and other expenses associated with the new Bernardsville branch location.
Total assets increased to $349.9 million at March 31, 2009, from $308.1 million at June 30, 2008 due primarily to an increase of $23.3 million in cash and cash equivalents and an increase of $13.8 million in loans receivable, net. Deposits were $269.4 million at March 31, 2009, compared to $225.4 million at June 30, 2008. FHLB advances were $36.4 million at March 31, 2009, as compared to $37.1 million at June 30, 2008. Stockholders' equity was $41.7 million at March 31, 2009, as compared to $43.4 million at June 30, 2008. The decrease in stockholders' equity is primarily due to share repurchases under the Company's stock repurchase plan.
Shares of the Company's common stock trade on the NASDAQ Global Market under the symbol "MSBF." The Company is majority owned by its mutual holding company parent, MSB Financial, MHC.
Forward Looking Statements
The foregoing release may contain forward-looking statements concerning the financial condition, results of operations and business of the Company. We caution that such statements are subject to a number of uncertainties and actual results could differ materially, and, therefore, readers should not place undue reliance on any forward-looking statements.
MSB FINANCIAL CORP
(Dollars in Thousands, except for per share amount)
SELECTED FINANCIAL AND OTHER DATA
MSB FINANCIAL CORP
(Dollars in Thousands, except for per share amount)
SELECTED FINANCIAL AND OTHER DATA
Balance Sheet Data:
(Unaudited)
At March 31, At June 30,
------------ ------------
2009 2008
------------ ------------
Total assets $ 349,943 $ 308,058
Cash and cash equivalents 28,018 4,695
Loans receivable, net 268,118 254,290
Securities held to maturity 32,865 28,743
Deposits 269,385 225,371
Federal Home Loan Bank advances 36,433 37,068
Total stockholders' equity 41,698 43,396
Summary of Operations:
(Unaudited) (Unaudited)
For the Nine For the Three
Months Ended Months Ended
March 31, March 31, March 31, March 31,
------------------------ ------------------------
2009 2008 2009 2008
----------- ----------- ----------- -----------
Total interest
income $ 12,478 $ 12,478 $ 4,140 $ 4,176
Total interest
expense 6,003 6,866 1,940 2,258
---------- ----------- ----------- -----------
Net interest
income 6,475 5,612 2,200 1,918
Provision for loan
losses 223 95 91 40
---------- ----------- ----------- -----------
Net interest
income after
provision for
loan losses 6,252 5,517 2,109 1,878
Noninterest income 378 443 104 119
Noninterest
expense 5,952 5,154 2,026 1,736
---------- ----------- ----------- -----------
Income before
taxes 678 806 187 261
Income tax
provision 258 276 71 91
---------- ----------- ----------- -----------
Net income $ 420 $ 530 $ 116 $ 170
========== =========== =========== ===========
Net income per
common share:
basic and
diluted $ 0.09 $ 0.10 $ 0.02 $ 0.03
Weighted average
number of shares
of common stock
outstanding 4,973,740 5,431,905 4,880,155 5,435,314
Performance Ratios:
(Unaudited) (Unaudited)
For the Nine For the Three
Months Ended Months Ended
March 31, March 31, March 31, March 31,
------------------------ ------------------------
2009 2008 2009 2008
----------- ----------- ----------- -----------
Return on average
assets (ratio of
net income to
average total
assets) 0.17% 0.24% 0.14% 0.23%
Return on average
equity (ratio of
net income to
average equity) 1.32 1.61 1.11 1.55
Net interest rate
spread 2.51 2.20 2.57 2.25
Net interest
margin on average
interest-earning
assets 2.88 2.73 2.85 2.75
Average interest-
earning assets to
average interest-
bearing
liabilities 113.58 115.99 111.31 115.59
Operating expense
ratio
(noninterest
expenses to
average total
assets) 2.48 2.37 2.45 2.35
Efficiency ratio
(noninterest
expense divided
by sum of net
interest income
and noninterest
income 86.85 85.12 87.93 85.22
(Unaudited)
At or For the
Nine Months Ended,
March 31, March 31,
-------------------------
2009 2008
------------ ------------
Asset Quality Ratios:
Non-performing loans to total loans 3.02% 1.51%
Non-performing assets to total assets 2.38 1.27
Net charge-offs to average loans
outstanding 0.00 0.00
Allowance for loan losses to non-
performing loans 15.01 26.70
Allowance for loan losses to total loans 0.45 0.40
Capital Ratios:
Equity to total assets at end of period 11.92% 14.42
Average equity to average assets 13.20 15.08
Number of Offices 5 4