Peoples Federal Bancshares, Inc. Announces Fiscal First Quarter 2014 Results

Peoples Federal Bancshares, Inc. Announces Fiscal First Quarter 2014 Results

BRIGHTON, Mass., Jan. 30, 2014 (GLOBE NEWSWIRE) -- Peoples Federal Bancshares,
Inc. (the "Company") (Nasdaq:PEOP), the holding company for Peoples Federal
Savings Bank (the "Bank"), reported financial results for the fiscal first
quarter ended December 31, 2013. For the quarter ended December 31, 2013, the
Company reported net income of $554,000 or $0.09 per share, basic and diluted,
as compared to net income of $681,000 or $0.11 per share, basic and diluted,
for the same period last year, and net income of $461,000, or $0.07 per share,
basic and diluted, for the quarter ended September 30, 2013.

For both the quarters ended December 31, 2013 and 2012, net interest and
dividend income totaled $4.3 million. The low interest rate environment has
continued to impact the Company's net interest and dividend income as recently
originated loans reflect the current low interest rate environment.
Non-interest income totaled $399,000 for the quarter ended December 31, 2013,
as compared to $492,000 for the quarter ended December 31, 2012, as gain on
sales of loans decreased $101,000, or 100.0%, during the current quarter.
Non-interest expense totaled $3.8 million for the quarter ended December 31,
2013 as compared to $3.4 million for the quarter ended December 31, 2012.

On a linked quarter basis, total interest and dividend income was $4.9 million
for the Company's fiscal quarter ended December 31, 2013 and as compared to
$4.8 million for the previous quarter ended September 30, 2013. Non-interest
income for the fiscal first quarter of 2014 decreased to $399,000 from
$402,000 for the quarter ended September 30, 2013. Non-interest expense
remained at $3.8 million for both the quarters ended December 31, 2013 and
September 30, 2013.

Total assets increased $3.2 million, or 0.5%, to $588.4 million at December
31, 2013 from $585.2 million at September 30, 2013. Loans, net increased $4.4
million, or 0.9% during the quarter, as residential loans and construction
loans increased, while commercial real estate, commercial loans and consumer
loans decreased. Cash and cash equivalents decreased $6.0 million to $31.1
million at December 31, 2013 from $37.1 million at September 30, 2013.
Securities available-for-sale and held-to-maturity in total increased $4.8
million, or 10.4%, to $51.1 million at December 31, 2013 from $46.3 million at
September 30, 2013. Borrowings increased to $52.0 million at December 31, 2013
from $44.0 million at September 30, 2013.

Deposits decreased $2.6 million to $422.5 million at December 31, 2013 from
$425.1 million at September 30, 2013. NOW accounts increased $4.2 million and
money market accounts increased $1.1 million during the December 31, 2013
quarter. Demand deposits decreased $3.2 million, savings accounts decreased
$218,000, and term certificates decreased $4.5 million during the same
quarter. At December 31, 2013, total stockholders' equity was $105.2 million,
a decrease of $1.2 million from $106.4 million at September 30, 2013,
resulting primarily from dividends paid of $1.7 million and the repurchase and
retirement of 34,607 shares or $607,000, of the Company's common stock
pursuant to the Company's stock repurchase plan.The decline in stockholder's
equity was offset, in part, by net income of $554,000, stock based
compensation expense of $525,000 and common stock released by the ESOP of
$124,000.

During the quarters ended December 31, 2013 and 2012, the Company paid
quarterly cash dividends of $0.04 and $0.03 per common share, respectively.In
addition, during both the December 31, 2013 and 2012 quarters, the Company
paid special cash dividends of $0.25 per common share.Dividends paid totaled
$1.7 million for each of the quarters ended December 31, 2013 and 2012.

Non-performing assets totaled $2.8 million, or 0.5% of total assets, at
December 31, 2013, compared to $2.1 million, or 0.4% of total assets, at
September 30, 2013.Classified assets decreased to $3.6 million at December
31, 2013, as compared to $4.1 million at September 30, 2013.The Company did
not provide to the allowance for loan losses during the quarter ended December
31, 2013 reflecting little change in net loans and improvements in loan
delinquencies, non-performing assets and classified assets.

Certain statements herein constitute "forward-looking statements" and actual
results may differ from those contemplated by these statements.
Forward-looking statements can be identified by the fact that they do not
relate strictly to historical or current facts. They often include words like
"believe," "expect," "anticipate," "estimate," and "intend" or future or
conditional verbs such as "will," "would," "should," "could" or "may."
Certain factors that could cause actual results to differ materially from
expected results include changes in the interest rate environment, changes in
general economic conditions, legislative and regulatory changes that adversely
affect the businesses in which Peoples Federal Bancshares, Inc. is engaged and
changes in the securities market. The Company disclaims any intent or
obligation to update any forward-looking statements, whether in response to
new information, future events or otherwise.

PEOPLES FEDERAL BANCSHARES, INC. AND SUBSIDIARIES
                                                            
CONSOLIDATED BALANCE SHEETS
                                                            
                                            December 31,     September 30,
                                            2013             2013
                                            (Unaudited)      
                                            (In thousands, except share data)
ASSETS
Cash and due from banks                      $4,438         $4,047
Interest-bearing demand deposits with other  24,363          30,906
banks
Federal funds sold                           239             79
Federal Home Loan Bank - overnight deposit   2,102           2,102
Total cash and cash equivalents              31,142          37,134
Securities available-for-sale                13,246          14,225
Securities held-to-maturity (fair values of  37,871          32,054
$37,524 and $32,105)
Federal Home Loan Bank stock (at cost)      3,775           3,775
Loans                                       474,438         470,086
Allowance for loan losses                   (4,019)         (4,037)
Loans, net                                  470,419         466,049
Premises and equipment, net                  3,431           3,465
Cash surrender value of life insurance       20,175          20,007
policies
Accrued interest receivable                 1,327           1,448
Deferred income tax asset, net               5,329           5,432
Other assets                                1,636           1,657
Total assets                                 $588,351       $585,246
                                                            
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:                                                    
Non-interest bearing                         $54,703        $57,891
Interest-bearing                             367,764         367,202
Total deposits                               422,467         425,093
Short-term borrowings                        8,000           6,000
Long-term debt                               44,000          38,000
Accrued expenses and other liabilities       8,701           9,801
Total liabilities                            483,168         478,894
                                                            
Stockholders' equity:                                        
Preferred stock, $0.01 par value; 50,000,000 --              --
shares authorized; none issued
Common stock, $0.01 par value; 100,000,000
shares authorized;
6,431,327 and 6,465,934 shares issued and    64              65
outstanding at December 31, 2013 and
September 30, 2013, respectively
Additional paid-in capital                   59,619          60,039
Retained earnings                            53,923          55,103
Accumulated other comprehensive loss         (61)            (30)
Unearned restricted shares; 233,387 and
256,894 shares at December 31, 2013 and     (3,791)         (4,183)
September 30, 2013, respectively
Unearned compensation - ESOP                 (4,571)         (4,642)
Total stockholders' equity                   105,183         106,352
Total liabilities and stockholders' equity   $588,351       $585,246



PEOPLES FEDERAL BANCSHARES, INC. AND SUBSIDIARIES
                                                        
CONSOLIDATED STATEMENTS OF INCOME
                                                        
                                    Three Months Ended
                                    December 31,
                                    2013                 2012
                                    (Unaudited)
                                    (Dollars in thousands, except share data)
Interest and dividend income:                            
Interest and fees on loans           $4,673             $4,853
Interest on debt securities:                             
Taxable                              233                 150
Other interest                       15                  18
Dividends on equity securities       4                   5
Total interest and dividend income   4,925               5,026
                                                        
Interest expense:                                        
Interest on deposits                 454                 612
Interest on Federal Home Loan Bank   168                 150
advances
Total interest expense               622                 762
Net interest and dividend income     4,303               4,264
Provision for loan losses            --                  120
Net interest and dividend income,    4,303               4,144
after provision for loan losses
                                                        
Non-interest income:                                     
Customer service fees                196                 210
Loan servicing fees, net             13                  8
Net gain on sales of mortgage loans  --                  101
Increase in cash surrender value of  168                 162
life insurance
Other income                         22                  11
Total non-interest income            399                 492
                                                        
Non-interest expense:                                    
Salaries and employee benefits      2,610               2,326
Occupancy expense                    228                 229
Equipment expense                    99                  106
Professional fees                    157                 117
Advertising expense                  133                 129
Data processing expense              219                 208
Deposit insurance expense            61                  69
Other expense                        253                 257
Total non-interest expense           3,760               3,441
Income before income taxes           942                 1,195
Provision for income taxes          388                 514
Net income                           $554               $681
                                                        
Weighted-average shares outstanding:                     
Basic                                5,746,458           5,975,422
Diluted                              5,810,294           6,031,289
                                                        
Earnings per common share:                               
Basic                                $0.09              $0.11
Diluted                              $0.09              $0.11



PEOPLES FEDERAL BANCSHARES, INC. AND SUBSIDIARIES
                                                        
CONSOLIDATED STATEMENTS OF INCOME
                                                        
                                    Three Months Ended
                                    December 31,         September 30,
                                    2013                 2013
                                    (Unaudited)
                                    (Dollars in thousands, except share data)
Interest and dividend income:                            
Interest and fees on loans           $4,673             $4,574
Interest on debt securities:                             
Taxable                              233                 183
Other interest                       15                  17
Dividends on equity securities       4                   4
Total interest and dividend income   4,925               4,778
                                                        
Interest expense:                                        
Interest on deposits                 454                 469
Interest on Federal Home Loan Bank   168                 156
advances
Total interest expense               622                 625
Net interest and dividend income     4,303               4,153
Provision for loan losses            --                  --
Net interest and dividend income,    4,303               4,153
after provision for loan losses
                                                        
Non-interest income:                                     
Customer service fees                196                 209
Loan servicing fees, net             13                  13
Increase in cash surrender value of  168                 157
life insurance
Other income                         22                  23
Total non-interest income            399                 402
                                                        
Non-interest expense:                                    
Salaries and employee benefits      2,610               2,626
Occupancy expense                    228                 246
Equipment expense                    99                  96
Professional fees                    157                 172
Advertising expense                  133                 118
Data processing expense              219                 216
Deposit insurance expense            61                  57
Other expense                        253                 236
Total non-interest expense           3,760               3,767
Income before income taxes           942                 788
Provision for income taxes          388                 327
Net income                          $554               $461
                                                        
Weighted-average shares outstanding:                     
Basic                                5,746,458           5,763,952
Diluted                              5,810,294           5,811,421
                                                        
Earnings per common share:                               
Basic                                $0.09              $0.07
Diluted                              $0.09              $0.07

The following table sets forth average assets, liability and equity account
balances, average yields and costs, and certain other information for the
periods indicated.No tax-equivalent yield adjustments were made, as the
effect thereof was not material.All average balances are daily average
balances.Non-accrual loans were included in the computation of average
balances, but have been reflected in the table as loans carrying a zero
yield.The yields set forth below include the effect of deferred fees,
discounts and premiums that are amortized or accreted to interest income or
expense.

                    Three Months Ended December 31,
                    2013                         2012
                    Average     Interest Average Average     Interest Average
                    Outstanding Earned/  Yield/  Outstanding Earned/  Yield/
                    Balance     Paid     Rate    Balance     Paid     Rate
                                          (1)                          (1)
                    (Unaudited)
                    (Dollars in thousands)
Interest-earning                                                  
assets:
Loans (2)            $467,306  $4,673 4.00%   $452,554  $4,853 4.29%
Taxable securities   49,126     233     1.90   42,062     150     1.43
(3)
Other
interest-earning     27,414     15      0.22   35,656     18      0.20
assets
FHLB stock           3,775      4       0.42   4,014      5       0.50
Total
interest-earning     547,621    4,925   3.60   534,286    5,026   3.76
assets
Non-interest-earning 35,806                    37,373             
assets
Total assets         $583,427                 $571,659          
                                                                 
Interest-bearing                                                  
liabilities:
Deposits:                                                         
Savings             $56,362   14      0.10   $50,814   20      0.16
Money market         150,495    155     0.41   153,038    235     0.61
accounts
NOW accounts         41,054     7       0.07   37,085     6       0.06
Term certificates    118,657    278     0.94   127,764    351     1.10
Total deposits       366,568    454     0.50   368,701    612     0.66
FHLB advances        44,326     168     1.52   32,457     150     1.85
Total
interest-bearing     410,894    622     0.61   401,158    762     0.76
liabilities
Demand deposits      56,014                    50,643             
Other
non-interest-bearing 10,564                    9,654              
liabilities
Total
non-interest-bearing 66,578                    60,297             
liabilities
Total liabilities    477,472                   461,455            
Stockholders' equity 105,955                   110,204            
Total liabilities
and stockholders'    $583,427                 $571,659          
equity
                                                                 
Net interest income             $4,303                   $4,264 
Net interest rate                       2.99%                      3.00%
spread (4)
Net interest-earning $136,727                 $133,128          
assets (5)
Net interest margin                     3.14%                      3.19%
(6)
Ratio of
interest-earning
assetsto total      1.33 x                    1.33 x             
interest-bearing
liabilities
                                                                 
(1) Yields are annualized.
(2) Average loans include non-accrual loans and are net of average deferred
loan fees/costs.
(3) Average balances are presented at average amortized cost.
(4) Net interest rate spread represents the difference between the yield on
interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest-earning assets represent total interest-earning assets less
total interest-bearing liabilities.
(6) Net interest margin represents net interest income divided by average
total interest-earning assets.


                    Three Months Ended
                    December 31, 2013            September 30, 2013
                    Average     Interest Average Average     Interest Average
                    Outstanding Earned/  Yield/  Outstanding Earned/  Yield/
                    Balance     Paid     Rate    Balance     Paid     Rate
                                          (1)                          (1)
                    (Unaudited)
                    (Dollars in thousands)
Interest-earning                                                  
assets:
Loans (2)            $467,306  $4,673 4.00%   $460,109  $4,574 3.98%
Taxable securities   49,126     233     1.90   43,861     183     1.67
(3)
Other
interest-earning     27,414     15      0.22   33,521     17      0.20
assets
FHLB stock           3,775      4       0.42   3,775      4       0.42
Total
interest-earning     547,621    4,925   3.60   541,266    4,778   3.53
assets
Non-interest-earning 35,806                    35,540             
assets
Total assets         $583,427                 $576,806          
                                                                 
Interest-bearing                                                  
liabilities:
Deposits:                                                         
Savings             $56,362   14      0.10   $55,991   14      0.10
Money market         150,495    155     0.41   151,019    158     0.42
accounts
NOW accounts         41,054     7       0.07   39,075     6       0.06
Term certificates    118,657    278     0.94   122,769    291     0.95
Total deposits       366,568    454     0.50   368,854    469     0.51
FHLB advances        44,326     168     1.52   35,685     156     1.75
Total
interest-bearing     410,894    622     0.61   404,539    625     0.62
liabilities
Demand deposits      56,014                    55,890             
Other
non-interest-bearing 10,564                    9,782              
liabilities
Total
non-interest-bearing 66,578                    65,672             
liabilities
Total liabilities    477,472                   470,211            
Stockholders' equity 105,955                   106,595            
Total liabilities
and stockholders'    $583,427                 $576,806          
equity
                                                                 
Net interest income             $4,303                   $4,153 
Net interest rate                       2.99%                      2.91%
spread (4)
Net interest-earning $136,727                 $136,727          
assets (5)
Net interest margin                     3.14%                      3.07%
(6)
Ratio of
interest-earning
assetsto total      1.33 x                    1.34 x             
interest-bearing
liabilities
                                                                 
(1) Yields are annualized.
(2) Average loans include non-accrual loans and are net of average deferred
loan fees/costs.
(3) Average balances are presented at average amortized cost.
(4) Net interest rate spread represents the difference between the yield on
interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest-earning assets represent total interest-earning assets less
total interest-bearing liabilities.
(6) Net interest margin represents net interest income divided by average
total interest-earning assets.

CONTACT: Maurice H. Sullivan, Jr.
         (617) 254-0707
 
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