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MSB Financial Corp Announces Earnings for the Fourth Quarter and Fiscal Year 2013

MSB Financial Corp Announces Earnings for the Fourth Quarter and Fiscal Year
2013

MILLINGTON, N.J., Aug. 30, 2013 (GLOBE NEWSWIRE) -- MSB Financial Corp.
(Nasdaq:MSBF) (the "Company") reported a net loss of $1.4 million or ($0.28)
per diluted common share for the fiscal year ended June 30, 2013, compared to
net income of $497,000 or $0.10 per diluted share for the year ended June 30,
2012. The $1.9 million decrease in net income for fiscal year 2013 as compared
to fiscal year 2012 was primarily attributable to an increase in the provision
for loan losses, decrease in net interest income and non-interest income and
an increase in non-interest expense. Income tax expense decreased for the
period to a net tax benefit.

For the quarter ended June 30, 2013, the Company reported net income of
$193,000 compared to net loss of $32,000 for the quarter ended June 30, 2012.
The $225,000 increase was attributable to a decrease of $608,000 in the
provision for loan losses, a $52,000 decrease in non-interest expense and a
$7,000 increase in non-interest income, offset by a $269,000 decrease in net
interest income and a $173,000 increase in income tax expense.

Net interest income for fiscal year 2013 was down $1.2 million or 11.0% to
$9.3 million as compared to $10.5 million for the year ended June 30, 2012.
This decrease resulted from a decrease in total interest income of $1.8
million, or 12.8%, offset by a decrease in total interest expense of $615,000,
or 18.4%. The decrease in total interest income was primarily attributable to
a 53 basis point decrease in the average yield earned on interest-earning
assets in addition to a decrease of $2.7 million or 0.9%, in the average
balance of such assets. The decrease of $615,000 or 18.4% in total interest
expense for the year ended June 30, 2013 was primarily due to a $2.7 million
decrease in average interest-bearing liabilities and a 21 basis point decrease
in the average rate paid on these liabilities. The interest rate spread for
fiscal 2013 was 2.90%, compared to 3.22% for fiscal 2012.

Net interest income decreased $269,000 or 10.7%, for the three months ended
June 30, 2013 compared to the three months ended June 30, 2012, due to the
combined effects of a decrease in the average yield on interest-earning assets
and an increase in the average balance of interest-bearing liabilities, offset
by an increase in the balance of average interest-earning assets and a
decrease in the rate paid on interest-bearing balances for the period.
Interest income on interest-earning assets for the three months ended June 30,
2013 decreased by $366,000, or 11.2%, while the average balance of
interest-earning assets increased by $4.0 million, or 1.3%, compared to the
three month period ended June 30, 2012. Interest expense decreased by $97,000,
or 12.9%, with the increase in the average balance of interest-bearing
liabilities of $6.6 million or 2.3% for the three months ended June 30, 2013
compared to the three months ended June 30, 2012, being more than offset by
the 15 basis point decrease in the average rate paid on those liabilities. The
interest rate spread for the three months ended June 30, 2013 was 2.77%,
compared to 3.13% for the three months ended June 30, 2012.

For the year ended June 30, 2013, the Company recorded a $4.0 million
provision for loan losses as compared to a $2.2 million provision recorded for
the year ended June 30, 2012. The higher provision was reflective of a
strategy the Company implemented during the quarter ended December 31, 2012. A
$2.0 million increase in the provision was made at that time to support the
Company's assets disposition strategy that had been approved by the Board of
Directors. This strategy was implemented in an attempt to rapidly reduce the
dollar amount of non-performing loans in the Company's loan portfolio.

The allowance for loan losses to total loans ratio at June 30, 2013 was at
1.9% compared to 1.2% at June 30, 2012, while the allowance for loan losses to
non-performing loans ratio increased from 18.29% at June 30, 2012 to 30.30% at
June 30, 2013. Non-performing loans to total loans and net charge-offs to
average loans outstanding ratios were at 6.16% and 1.19%, respectively, at
June 30, 2013 compared to 6.81% and 0.53% at June 30, 2012. Management
continues to closely monitor its loan portfolio in an attempt to mitigate
future loan losses.

Non-interest income increased by $19,000, or 3.0%, to $650,000 for the year
ended June 30, 2013 compared to $631,000 for the year ended June 30, 2012,
primarily due to a $16,000 increase in bank owned life insurance income, a
$9,000 increase in unrealized gains on trading securities and a $6,000
increase in other income, offset by a $12,000 decrease in fees and service
charges. Non-interest income increased by $7,000 or 4.3% for the three months
ended June 30, 2013 compared to the three months ended June 30, 2012 due to a
$6,000 increase in unrealized gain on trading securities and a $5,000 increase
in bank owned life insurance income, offset by a $4,000 decrease in fees and
service charges.

Non-interest expense totaled $8.3 million for the year ended June 30, 2013 as
compared to $8.1 million for the year ended June 30, 2012, an increase of
$190,000, or 2.4%. The increase in non-interest expense was attributable to a
$94,000 increase in other expense, a $83,000 increase in service bureau fees,
as well as a $49,000 increase in salaries and employee benefits expense and a
$29,000 increase in professional service expense, offset by a $30,000 decrease
in occupancy and equipment expense, a $19,000 decrease in directors'
compensation expense, a $12,000 decrease in advertising expense and a $4,000
decrease in FDIC assessment expense. Non-interest expense decreased by $52,000
or 2.6%, for the three months ended June 30, 2013 compared to the three months
ended June 30, 2012 primarily due to a $70,000 decrease in other expense, a
$35,000 decrease in directors' compensation expense, as well as a $26,000
decrease in professional services expense and a $1,000 decrease in FDIC
assessment expense, offset by a $39,000 increase in occupancy and equipment
expense, a $22,000 increase in salaries and employee benefits expense, as well
as an $11,000 increase in service bureau fees and a $8,000 increase in
advertising expense.

The Company had a tax benefit of $987,000 for the year ended June 30, 2013
compared to tax expense of $283,000 for the year ended June 30, 2012, a
decrease of $1.3 million or 448.8%. Income tax expense for the three months
ended June 30, 2013 was $100,000 compared to a tax benefit of $73,000 for the
three months ended June 30, 2012, representing an increase of $173,000 or
237.0%.

Total assets were $352.6 million at June 30, 2013, compared to $347.3 million
at June 30, 2012. The Company recorded a $30.2 million or 59.6% increase in
securities held to maturity, while loans receivable, net, decreased by $17.3
million or 7.2%, and cash equivalent balances decreased by $9.0 million or
26.7% from June 30, 2012 to June 30, 2013. Deposits decreased $3.3 million or
1.2%, while advances from the Federal Home Loan Bank of New York increased by
$10.0 million or 50.0% from June 30, 2012 to June 30, 2013. The $10.0 million
increase in Federal Home Loan Bank of New York borrowing was the result of a
strategy the Company instituted in February 2013 to invest these funds in
higher yielding held to maturity securities due to the lack of loan demand.
This borrowing, in addition to the funds made available due to do to the lack
of loan demand and lower cash and cash equivalent balances, primarily resulted
in the increase in the securities held to maturity balance as of June 30, 2013
compared to June 30, 2012.In addition, total cash and cash equivalent
balances, in part, decreased due to a decrease in deposit balances.The
decrease in deposit balances was primarily due to the Company lowering its
offering rates during this period.Stockholders' equity was $39.5 million at
June 30, 2013 compared to $40.9 million at June 30, 2012, a decrease of $1.4
million or 3.3%. The decrease was primarily the result of a decrease in
retained earnings as a result of the $1.4 million loss the Company incurred
for the year ended June 30, 2013. In addition, treasury stock increased by
$476,000 due to repurchases of the Company's common stock, while the increase
in paid in capital of $259,000 related primarily to the compensation expense
attributable to the Company's stock-based compensation plan.The unallocated
common stock held by ESOP balance decreased by $169,000, as did the
accumulated other comprehensive loss balance which decreased by $68,000 for
the period ended June 30, 2013 compared to the period ended June 30, 2012.

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 forgoing 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
                                                                  
Statement of Financial Condition Data:
                                                       (Unaudited) 
                                                       At June 30, 
                                              2013      2012        2011
                                                                  
Total assets                                   $352,592  $347,347    $349,459
                                                                  
Cash and cash equivalents                      24,755    33,757      30,976
                                                                  
Loans receivable, net                          223,256   240,520     253,251
                                                                  
Securities held to maturity                    80,912    50,706      41,693
                                                                  
Deposits                                       280,467   283,798     286,175
                                                                  
Borrowed funds                                 30,000    20,000      20,000
                                                                  
Total stockholder's equity                     39,513    40,878      40,680
                                                                  
                                                                  
Summary of Operations:
                                                       (Unaudited) 
                                              For the Year Ended June 30,
                                              2013      2012        2011
                                                                  
Total interest income                          $12,032   $13,801     $15,127
                                                                  
Total interest expense                         2,721     3,336       4,226
                                                                  
Net interest income                            9,311     10,465      10,901
                                                                  
Provision for loan losses                      4,044     2,217       1,686
                                                                  
Net interest income after provision for loan   5,267     8,248       9,215
losses
                                                                  
Noninterest income                             650       631         773
                                                                  
Noninterest expense                            8,289     8,099       8,767
                                                                  
Income before taxes                            (2,372)   780         1,221
                                                                  
Income tax provision                           (987)     283         515
                                                                  
Net income                                     ($1,385)  $497        $706
                                                                  
                                                                  
Net income per common share: basic and diluted ($0.28)   $0.10       $0.14
                                                                  
Weighted average number of shares of common    4,933,187 4,985,512   5,040,643
stock outstanding
                                                                  
                                                                  
                                                                  
                                              (Unaudited)          
                                              At or For the        
                                              Year Ended           
Performance Ratios:                            June 30,             
                                              2013      2012        
                                                                  
Return on average assets (ratio of net income  (0.40)    0.14%       
to average total assets)
                                                                  
Return on average equity (ratio of net income  (3.45)    1.21        
to average equity)
                                                                  
Net interest rate spread                       2.90      3.22        
                                                                  
Net interest margin on average                 2.98      3.32        
interest-earning assets
                                                                  
Average interest-earning assets to average     109.33    109.22      
interest-bearing liabilities
                                                                  
Operating expense ratio (noninterest expenses  2.39      2.34        
to average total assets)
                                                                  
Efficiency ratio (noninterest expense divided
by sum of net interest income and noninterest  83.21     73.07       
income)
                                                                  
Asset Quality Ratios:                                              
                                                                  
Non-performing loans to total loans            6.16      6.81        
                                                                  
Non-performing assets to total assets          4.15      4.82        
                                                                  
Net charge-offs to average loans outstanding   1.19      0.53        
                                                                  
Allowance for loan losses to non-performing    30.30     18.29       
loans
                                                                  
Allowance for loan losses to total loans       1.87      1.24        
                                                                  
                                                                  
Capital Ratios:                                                    
                                                                  
Equity to total assets at end of period        11.21     11.77       
                                                                  
Average equity to average assets               11.58     11.79       
                                                                  
Number of Offices                              5         5           

CONTACT: MSB Financial Corp.
         Michael Shriner, President/CEO
         908-647-4000
         mshriner@millingtonsb.com