United Community Bancorp Reports Second Quarter Results

           United Community Bancorp Reports Second Quarter Results

PR Newswire

LAWRENCEBURG, Ind., Jan. 28, 2014

LAWRENCEBURG, Ind., Jan.28, 2014 /PRNewswire/ --United Community Bancorp
(the "Company") (Nasdaq:UCBA), the parent company of United Community Bank
(the "Bank"), today reported net income of $582,000, or $0.12 per diluted
share, for the quarter ended December 31, 2013, compared to net income of
$696,000, or $0.14  per diluted share, for the quarter ended December 31,
2012. Net income for the six months ended December 31, 2013 was $1.3 million,
or $0.28 per diluted share, compared to net income of $1.2 million, or $0.24
per diluted share, for the six months ended December 31, 2012.



United Community Bancorp
Summarized Statements of Income
(In thousands, except per share data)
                                           For the six months ended
                                           12/31/2013   12/31/2012
                                           (Unaudited)  (Unaudited)
Interest income                            $7,527       $8,328
Interest expense                           1,386        1,892
 Net interest income                      6,141        6,436
Provision for (recovery of) loan losses    (367)        475
 Net interest income after provision for  6,508        5,961
 (recovery of) loan losses
Total other income                         2,063        2,434
Total noninterest expense                  6,742        6,787
 Income before income taxes               1,829        1,608
Income tax provision                       485          418
 Net income                               $1,344       $1,190
Basic and diluted earnings per share^(1)   $0.28        $0.24
Weighted average shares outstanding^(1)    4,875,257    5,050,134

^(1) Weighted average share and related earnings per share amounts for
periods prior to January
 9, 2013 have been restated retroactively to reflect the previously
announced second step
 conversion at a conversion rate of 0.6573 to 1.



Summarized Consolidated Statements of Financial Condition
                (Unaudited)  (Unaudited) (Audited)    (Unaudited) (Unaudited)
(In thousands,  12/31/2013   9/30/2013   6/30/2013    3/31/2013   12/31/2012
as of)
ASSETS
Cash and Cash   $          $  16,639 $ 16,787     $ 27,621    $ 39,375
Equivalents     21,553
Investment      204,677      208,828     202,547      204,783     173,258
Securities
Loans           247,165      247,202     254,578      258,454     266,684
Receivable, net
Other Assets    38,817       38,782      38,719       35,109      37,347
Total Assets    $  512,212 $ 511,451  $ 512,631   $  525,967 $ 516,664
LIABILITIES
Municipal       $  103,240 $ 101,994   $   90,141 $          $  102,806
Deposits                                              103,483
Other Deposits  317,226      322,837     331,102      333,498     322,311
FHLB Advances   15,000       10,000      15,000       10,083      10,333
Other           2,530        3,241       2,845        3,932       3,006
Liabilities
Total           437,996      438,072     439,088      450,996     438,456
Liabilities
Commitments and -            -           -            -           22,889
contingencies
Total
Stockholders'   74,216       73,379      73,543       74,971      55,319
Equity
Total
Liabilities &   $  512,212 $ 511,451  $ 512,631   $          $ 516,664
Stockholders'                                         525,967
Equity
Summarized Consolidated Statements of Income
                (Unaudited)  (Unaudited) (Unaudited)  (Unaudited) (Unaudited)
                12/31/2013   9/30/2013   6/30/2013    3/31/2013   12/31/2012
                (for the three months ended, in thousands, except per share
                data)
Interest Income $         $        $         $        $   
                3,768       3,759      3,712       3,847      4,103
Interest        638          748         712          747         889
Expense
Net Interest    3,130        3,011       3,000        3,100       3,214
Income
Provision for
(Recovery of)   75           (442)       (651)        110         225
Loan Losses
Net Interest
Income after
Provision
 for
(Recovery of)   3,055        3,453       3,651        2,990       2,989
Loan Losses
Total Other     1,011        1,052       1,106        949         1,367
Income
Total
Noninterest     3,294        3,448       3,381        3,427       3,370
Expense
Income before   772          1,057       1,376        512         986
Tax Provision
Income Tax      190          295         406          105         290
Provision
Net Income      $       $      $       $      $     
                582          762         970          407         696
Basic and
Diluted         $        $       $        $       $    
Earnings per    0.12        0.16       0.20        0.08       0.14
Share (1)
Weighted
Average Shares
Outstanding
(1):
Basic and       4,875,257    4,875,257   4,875,257    4,892,523   5,050,134
Diluted
(1) Weighted average share and related earnings per share amounts for periods
prior to January 9, 2013 have been restated
  retroactively to reflect the previously announced second step
conversion at a conversion rate of 0.6573 to 1.



                  (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
                  For the three months ended
                  12/31/2013  9/30/2013   6/30/2013   3/31/2013   12/31/2012
Performance
Ratios:
Return on average 0.45%       0.59%       0.75%       0.31%       0.55%
assets (1)
Return on average 3.14%       4.17%       5.19%       2.41%       5.02%
equity (1)
Interest rate     2.58%       2.48%       2.43%       2.47%       2.70%
spread (2)
Net interest      2.62%       2.53%       2.48%       2.53%       2.75%
margin (3)
Noninterest
expense to        2.55%       2.68%       2.60%       2.61%       2.67%
average assets
(1)
Efficiency ratio 79.55%      84.86%      82.34%      84.64%      73.56%
(4)
Average
interest-earning
assets to
 average
interest-bearing  108.81%     108.65%     109.29%     109.16%     106.17%
liabilities
Average equity to 14.36%      14.23%      14.37%      12.83%      10.98%
average assets
Bank Capital
Ratios:
Tangible capital  12.30%      12.18%      12.07%      11.56%      9.37%
Core capital      12.30%      12.18%      12.07%      11.56%      9.37%
Total risk-based  27.33%      26.95%      26.72%      26.17%      20.36%
capital
Asset Quality
Ratios:
Nonperforming
loans as a
percent
 of total loans 3.48%       3.74%       4.87%       5.39%       5.34%
Nonperforming
assets as a
percent
 of total       1.88%       1.98%       2.60%       2.79%       2.98%
assets
Allowance for
loan losses as a
percent
 of total loans 2.12%       2.15%       2.09%       2.18%       2.10%
Allowance for
loan losses as a
percent
 of
nonperforming     60.90%      57.57%      42.83%      40.35%      39.37%
loans
Net charge-offs
(recoveries) to
average
 outstanding
loans during the  0.30%       (0.76)%     (0.56)%     0.13%       0.29%
period (1)
(1) Quarterly income and expense amounts used in
calculating the ratio have been annualized.
(2) Represents the difference between the weighted average yield on
average interest-earning assets and the weighted average
  cost of average interest-bearing liabilities.
(3) Represents net interest income as a percent of average
interest-earning assets.
(4) Represents total noninterest expense divided by the sum of net
interest income and total other income.

For the three months ended December 31, 2013:

Net income decreased $114,000 to $582,000 for the quarter ended December 31,
2013, compared to net income of $696,000 for the quarter ended December 31,
2012.

Net interest income decreased $84,000, or 2.6%, to $3.1 million for the
quarter ended December 31, 2013 as compared to $3.2 million for the quarter
ended December 31, 2012. A decrease of $335,000 in interest income was
partially offset by a $251,000 decrease in interest expense. The decrease in
interest income was the result of a $22.4 million decrease in the average
balance of loans, a decrease in the average rate earned on loans from 4.94%
for the quarter ended December 31, 2012 to 4.82% for the quarter ended
December 31, 2013, and a decrease in the average rate earned on investments
from 1.81% for the quarter ended December 31, 2012 to 1.53% for the quarter
ended December 31, 2013, partially offset by a $35.2 million increase in the
average balance of investments. The decrease in interest expense was
primarily the result of a decrease in the average interest rate paid on
deposits from 0.78% for the quarter ended December 31, 2012 to 0.55% for the
quarter ended December 31, 2013. Changes in interest rates are reflective of
decreases in overall market rates.

The provision of loan losses was $75,000 for the quarter ended December 31,
2013, compared to $225,000 for the same quarter in the prior year. The
decrease in the provision for loan losses is reflective of continued
improvement in our asset quality. Asset quality continues to improve primarily
due to the Bank's continuing efforts to resolve asset quality issues.
Nonperforming assets as a percentage of total assets decreased from 2.98% at
December 31, 2012 to 1.88% at December 31, 2013.

Other income decreased $356,000, or 26.0%, to $1.0 million for the quarter
ended December 31, 2013 compared to $1.4 million for the prior year quarter.
The decrease is primarily due to a $245,000 decrease in gain on sale of loans
and a $263,000 decrease in gain on sale of investments, partially offset by a
$147,000 increase in other income. The decrease in gain on sale of loans is
the result of a higher level of refinancing activity during the quarter ended
December 31, 2012 as compared to the current year quarter due to higher loan
rates in the current year quarter. The decrease in gain on sale of investments
is due to the sale of mortgage-backed securities in the quarter ended December
31, 2012 with no such sales in the current year quarter. The increase in other
income is primarily due to an increase in the value of mortgage servicing
rights during the quarter ended December 31, 2013. The increase in income from
mortgage servicing rights is primarily due to the year over year decrease in
the prepayment of mortgages. 

Noninterest expense decreased $76,000 to $3.3 million for the quarter ended
December 31, 2013 compared to $3.4 million for the prior year quarter.
Decreases of $79,000 in premises and occupancy expense and $96,000 in
provision for loss on real estate owned were partially offset by an increase
of $127,000 in professional fees. The decrease in premises and occupancy
expense was primarily the result of non-recurring expenses for data processing
upgrades in the prior year quarter. The decrease in provision for loss on
real estate owned is due to write-downs on two commercial OREO properties in
the prior year quarter with no such write-downs during the quarter ended
December 31, 2013. The increase in professional fees is primarily the result
of acquiring outside resources for internal audit and planning in the current
year.

For the six months ended December 31, 2013:

Net income increased $154,000 to $1.3 million for the six months ended
December 31, 2013, compared to net income of $1.2 million for the six months
ended December 31, 2012.

Net interest income decreased $295,000, or 4.6%, to $6.1 million for the six
months ended December 31, 2013 as compared to $6.4 million for the six months
ended December 31, 2012. A decrease of $801,000 in interest income was
partially offset by a $506,000 decrease in interest expense. The decrease in
interest income was the result of a $24.4 million decrease in the average
balance of loans, a decrease in the average rate earned on loans from 4.96%
for the six months ended December 31, 2012 to 4.88% for the six months ended
December 31, 2013, and a decrease in the average rate earned on investments
from 1.90% for the six months ended December 31, 2012 to 1.40% for the six
months ended December 31, 2013, partially offset by a $43.7 million increase
in the average balance of investments. The decrease in interest expense was
primarily the result of a decrease in the average interest rate paid on
deposits from 0.84% for the six months ended December 31, 2012 to 0.60% for
the six months ended December 31, 2013. Changes in interest rates are
reflective of decreases in overall market rates.

The recovery of loan losses was $367,000 for the six months ended December 31,
2013, compared to a provision for loan losses of $475,000 for the same period
in the prior year. The decrease in the provision for loan losses was primarily
due to a $379,000 recovery of a commercial loan and a $124,000 recovery from
two one- to four-family loans during the six months ended December 31, 2013.
The decrease in the provision for loan losses is also reflective of continued
improvement in our asset quality. Nonperforming assets as a percentage of
total assets decreased from 2.98% at December 31, 2012 to 1.88% at December
31, 2013.

Other income decreased $371,000, or 15.2%, to $2.1 million for the six months
ended December 31, 2013 compared to $2.4 million for the prior year period.
The decrease is primarily due to a $406,000 decrease in gain on sale of loans
and a $263,000 decrease in gain on sale of investments, partially offset by a
$136,000 increase in gain on sale of fixed assets and a $162,000 increase in
other income. The decrease in gain on sale of loans is the result of a higher
level of refinancing activity during the six months ended December 31, 2012 as
compared to the current year period due to higher loan rates in the current
year period. The decrease in gain on sale of investments is due to the sale of
mortgage-backed securities in the six months ended December 31, 2012 with no
such sales in the current year period. The increase in gain on sale of fixed
assets was the result of the sale of our Osgood branch facility during the six
months ended December 31, 2013. The increase in other income is primarily due
to an increase in the value of mortgage servicing rights during the six months
ended December 31, 2013. The increase in income from mortgage servicing rights
is primarily due to the decrease during the six month period in the prepayment
of mortgages as compared to the prepayment of mortgages during the prior six
month period. 

Noninterest expense decreased $45,000 to $6.7 million for the six months ended
December 31, 2013 compared to $6.8 million for the prior year period.
Decreases of $114,000 in premises and occupancy expense, $105,000 in deposit
insurance premium and $104,000 in provision for loss on real estate owned were
partially offset by increases of $114,000 in professional fees and $120,000 in
other operating expenses. The decrease in premises and occupancy expense was
primarily the result of non-recurring expenses for data processing upgrades in
the prior year period. The decrease in provision for loss on real estate
owned is due to write-downs on two commercial OREO properties in the prior
year period with no such write-downs during the six months ended December 31,
2013. The increase in professional fees is primarily the result of acquiring
outside resources for internal audit and planning in the current year. The
increase in other operating expenses is primarily the result of a short-term
loan-related promotion during the current year period.

Total assets were $512.2 million at December 31, 2013, compared to $512.6
million at June 30, 2013. A $7.4 million decrease in loans was partially
offset by a $4.8 million increase in cash and cash equivalents, and a $2.1
million increase in investment securities. The decrease in loans was
primarily the result of net payoffs totaling $5.8 million in one- to
four-family real estate loans and $2.3 million in commercial real estate loans
during the six months ended December 31, 2013. The increase in cash and cash
equivalents and investment securities was the result of the payoff of loans
with a portion of the proceeds redeployed into purchases of mortgage-backed
securities and available for sale securities.

Total liabilities were $438.0 million at December 31, 2013, compared to $439.1
million at June 30, 2013.

Total stockholders' equity was $74.2 million at December 31, 2013, compared to
$73.5 million at June 30, 2013. The increase was primarily the result of net
income of $1.3 million for the six months ended December 31, 2013, partially
offset by dividends paid of $504,000 and a $441,000 after-tax decrease in
unrealized loss on investments. At December 31, 2013, the Bank was considered
"well-capitalized" under applicable regulatory requirements.

United Community Bancorp is the parent company of United Community Bank,
headquartered in Lawrenceburg, Indiana. The Bank currently operates eight
offices in Dearborn and Ripley Counties, Indiana.

This news release may contain forward-looking statements, which can be
identified by the use of words such as "believes," "expects," "anticipates,"
"estimates" or similar expressions. Such forward-looking statements and all
other statements that are not historic facts are subject to risks and
uncertainties which could cause actual results to differ materially from those
currently anticipated due to a number of factors. These factors include, but
are not limited to, general economic conditions, changes in the interest rate
environment, legislative or regulatory changes that may adversely affect our
business, changes in accounting policies and practices, changes in competition
and demand for financial services, adverse changes in the securities markets,
changes in deposit flows and changes in the quality or composition of the
Company's loan or investment portfolios. Additionally, other risks and
uncertainties may be described in the Company's annual report on Form 10-K for
the year ended June 30, 2013 filed with the SEC on September 27, 2013 which is
available through the SEC's website at www.sec.gov. Should one or more of
these risks materialize, actual results may vary from those anticipated,
estimated or projected. Readers are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date of this
press release. Except as may be required by applicable law or regulation, the
Company assumes no obligation to update any forward-looking statements.

SOURCE United Community Bancorp

Website: http://www.bankucb.com
Contact: United Community Bancorp, William F. Ritzmann, President and Chief
Executive Officer, (812) 537-4822
 
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