Breaking News

Tweet TWEET

HopFed Bancorp, Inc. Reports First Quarter Results

  HopFed Bancorp, Inc. Reports First Quarter Results  Business Wire  HOPKINSVILLE, Ky. -- April 25, 2014  HopFed Bancorp, Inc. (NASDAQ: HFBC) (the “Company”), the holding company for Heritage Bank USA, Inc. (the “Bank”), today reported results for the three month period ended March 31, 2014. For the three month period ended March 31, 2014, the Company’s net income was $354,000, or $0.05 per share, basic and diluted, compared to net income of $984,000, or $0.13 per share basic and diluted, for the three month period ended March 31, 2013.  Commenting on the first quarter results, John E. Peck, President and Chief Executive Officer, said, “The Company’s net interest income for the three month period ended March 31, 2014, declined by $66,000 as compared to the three month period ended December 31, 2013, and $71,000 as compared to the three month period ended March 31, 2013. At March 31, 2014, net loans totaled $536.0 million, a decline of $7.6 million as compared to December 31, 2013. The Company’s loan pipeline remains relatively robust, but the Company’s lending markets remain extremely competitive.  “The Company experienced a significant decline in non-interest income during the three month period ended March 31, 2014, as compared to the three month periods ended December 31, 2013, and March 31, 2013. On a linked quarter basis, non-interest income declined by $694,000, or 30.2%. The linked quarter decline in non-interest income was largely the result of a $412,000 gain on the sale of the Company’s insurance assets in December 2013. As compared to March 31, 2013, non-interest income declined by $885,000, or 35.6%. For the three month period ended March 31, 2013, the Company recognized $627,000 in gains on the sale of securities as compared to $13,000 for the three month period ended March 31, 2014,” Mr. Peck concluded.  Financial Highlights    *At March 31, 2014, the Company’s tangible book value was $13.10 per share     and tangible commonequity ratio was 10.10%. The Bank’s Tier 1 Leverage     Ratio and Total Risk Based Capital Ratio at March 31, 2014, were 10.65%     and 18.21%, respectively. The Company’s Tier 1 Leverage Ratio and Total     Risk Based Capital Ratio at March 31, 2014, were 11.09% and 18.88%,     respectively.   *The Company purchased 10,386 shares of its common stock in the quarter at     a weighted average price of $11.49 per share. The Company has purchased a     total of 86,854 shares since September 16, 2013, at a weighted average     price of $11.19 per share.   *At March 31, 2014, the Company’s allowance for loan loss totaled $8.9     million, or 1.64% of total loans and 88.85% of non-accrual loans. In the     three month period ended March 31, 2014, the Company’s net charge offs     totaled $149,000, or an annualized rate of 0.11% of average loans.   *For the three month period ended March 31, 2014, the Company’s net     interest margin was 3.00%, as compared to 3.10% for the three month period     ended December 31, 2013, and 2.99% for the three month period ended March     31, 2013.  Asset Quality  At March 31, 2014, the Company’s level of non-accrual loans totaled $10.0 million, as compared to $10.1 million at December 31, 2013. A summary of non-accrual loans at March 31, 2014, and December 31, 2013, is as follows:                                March 31, 2014  December 31, 2013                                (Dollars in Thousands)                                                  One-to-four family mortgages   $     1,056      $      945 Home equity line of credit           49                1 Junior lien                          1                 2 Multi-family                         ---               --- Construction                         ---               175 Land                                 1,217             1,218 Non-residential real estate          6,585             6,546 Farmland                             669               703 Consumer loans                       2                 13 Commercial loans                    453              463 Total non-accrual loans        $     10,032     $      10,066                                                          At each of March 31, 2014, and December 31, 2013, non-accrual loans plus other real estate owned totaled $11.7 million, or 1.21% of total assets. A summary of the activity in other real estate owned for the three month period ended March 31, 2014, is as follows:                   Activity During 2013                   Balance                             Reduction  Gain    Balance                                                                      (Loss)                   12/31/2013  Foreclosures  Proceeds  in Values  on      3/31/2014                                                                      Sale                   (Dollars in Thousands) One-to-four family            $   350      166            (66   )    ---         (4   )   $  446 mortgages Multi-family          ---      ---            ---        ---         ---         --- Construction          ---      ---            ---        ---         ---         --- Land                  1,124    ---            (71   )    ---         (19  )      1,034 Non-residential       200      ---            ---        ---         ---         200 real estate Consumer assets      ---      ---            ---       ---         ---       ---                                                                                Total             $   1,674    166            (137  )    ---         (23  )   $  1,680                                                                                    The Company had no loans classified as performing Troubled Debt Restructurings (“TDRs”) at March 31, 2014, and December 31, 2013.  Asset Quality (continued)  At March 31, 2014, the Company’s level of loans classified as substandard was $39.0 million as compared to $42.6million at December 31, 2013. At March 31, 2014, the Company’s classified loan to risk-based capital ratio was 34.08%. The Company’s specific reserve for impaired loans was $2.0 million at March 31, 2014, and $1.9 million at December 31, 2013. A summary of the level of classified loans net of unearned fees, at March 31, 2014, is as follows:                                                                         Specific    Allowance                                         Impaired Loans                       Allowance    for March 31, 2014                Special                                       for          Performing                   Pass        Mention   Substandard   Doubtful   Total       Impairment   Loans                   (Dollars in Thousands) One-to-four family            $ 150,717   904       2,336         ---        $ 153,957   $    580     $   1,571 mortgages Home equity         33,404    ---       543           ---          33,947         ---         221 line of credit Junior liens        2,764     42        23            ---          2,829          ---         27 Multi-family        23,871    4,899     ---           ---          28,770         ---         267 Construction        11,278    ---       ---           ---          11,278         ---         --- Land                16,058    3,464     14,632        ---          34,154         722         577 Non-residential     141,275   345       12,320        ---          154,083        546         2,366 real estate Farmland            41,605    488       5,658         ---          47,608         ---         754 Consumer loans      14,604    ---       656           ---          15,260         160         520 Commercial         58,822    1,399     2,877         ---         63,098        ---        602 loans                                                                                            Total             $ 494,398   11,541    39,045        ---        $ 544,984   $    2,008   $   6,905                                                                                                 Net Interest Income  For the three month period ended March 31, 2014, the Company’s net interest income was $6.3 million, compared to$6.4million for each of the three month periods ended December 31, 2013, and March 31, 2013. For the three month period ended March 31, 2014, the Company’s net interest margin was 3.00%, as compared to 3.10% for the three month period ended December 31, 2013, and 2.99% for the three month period ended March 31, 2013.  The decline in net interest income was the result of lower average balances and yields on loans, offsetting lower levels of interest expense. For the three month period ended March 31, 2014, interest income on loans was $6.3 million, declining $251,000 and $555,000, as compared to the three month periods ended December 31, 2013, and March 31, 2013. For the three month period ended March 31, 2014, the average yield on loans was 4.75%, compared to 4.96% and 5.27% for the three month periods ended December 31, 2013, and March 31, 2013, respectively.  For the three month period ended March 31, 2014, interest expense was $2.3 million, declining $39,000 and $576,000 as compared to the three month periods ended December 31, 2013 and March 31, 2013, respectively. For the three month period ending March 31, 2014, the average cost of interest bearing liabilities was 1.23%, as compared to 1.28% and 1.51% for the three month periods ended December 31, 2013 and March 31, 2013, respectively.  Non-interest Income  Non-interest income for the three month period ended March 31, 2014, was $1.6 million, as compared to $2.3 million for the three month period ended December 31, 2013, and $2.5 million for the three month period ended March 31, 2013. The decline in non-interest income for the three month period ended March 31, 2014, as compared to the three month period ended December 31, 2013, was primarily the result of a $412,000 gain on the sale of the Company’s insurance assets in December of 2013. Additionally, the Company earned $94,000 in non-interest income related to the Company’s insurance assets in the three month period ended December 31, 2013. Despite the reduction in non-interest income, the Company’s insurance assets were marginally profitable, contributing less than $60,000 in net income to the Company during the twelve month period ended December 31, 2013.  For the three month period ended March 31, 2014, service charge income declined by $153,000 and $75,000, respectively, as compared to the three month periods ended December 31, 2013 and March 31, 2013. For the three month period ended March 31, 2014, merchant card income was $259,000, an increase of $3,000 and $36,000, respectively, as compared to the three month periods ended December 31, 2013 and March 31, 2013. Typically, the Company’s service charge and merchant fee income are highest in the fourth quarter of each year and lowest in the first quarter of each year.  For the three month period ended March 31, 2014, the Company’s income on the origination of mortgage loans was $58,000, a decline from the $200,000 of income earned during the three month period ended March 31, 2013. The decline in mortgage origination income was largely the result of higher, long term interest rates, as the market rate on a thirty-year, fixed rate mortgage has increased significantly since March 31, 2013, virtually eliminating refinancing activity.  The Company recognized net gains on the sale of securities of $13,000, $44,000, and $627,000 for the three month periods ended March 31, 2014, December 31, 2013, and March 31, 2013, respectively. As interest rates have increased, the Company has experienced a reduction in its unrealized gain on the sale of securities, limiting the opportunities to harvest gains from the investment portfolio.  Non-interest Expense  On a linked quarter basis, the Company’s non-interest expenses increased by $68,000. The most significant increases in operating expenses were a $359,000 increase in salaries and benefits and a $108,000 increase in deposit insurance expense. The most significant reductions in operating expense line items were those expenses related to losses on real estate owned and the management of those assets for a combined decrease of $210,000, a $106,000 decline in advertising expenses and a $190,000 decline in other operating expenses.  For the three month period ended March 31, 2014, non-interest expenses increased by $50,000 as compared to the three month period ended March 31, 2013. At March 31, 2014, the Company’s state deposit taxes increased by $104,000; and our data processing expenses increased by $78,000, each as compared to the three month period ended March 31, 2013.  Balance Sheet  At March 31, 2014, consolidated assets were $965.0 million, a decline of $8.6 million as compared to December31,2013. For the three month period ended March 31, 2014, the Company experienced a $10.9 million decrease in time deposits, a $5.5 million decrease in FHLB borrowings, a $20.4 million decrease in cash balances and a $7.7 million decrease in net loan balances. The Company invested excess liquidity in securities as the balance of available for sale securities increased $22.6 million to $341.5 million.  The Company  Prior to June 5, 2013, HopFed Bancorp, Inc. was a federally chartered savings and loan holding company with Heritage Bank as its wholly owned thrift subsidiary. On June 5, 2013, Heritage Bank’s legal name was changed to Heritage Bank USA, Inc., and its charter was converted to a Kentucky state chartered commercial bank with the Kentucky Department of Financial Institutions and the Federal Deposit Insurance Corporation as its regulators. Also on June 5, 2013, HopFed Bancorp, Inc. became a non-member federally chartered commercial bank holding company regulated by the Federal Reserve Board. HopFed Bancorp, Inc. is the holding company for Heritage Bank USA, Inc. headquartered in Hopkinsville, Kentucky. TheBank haseighteen offices in western Kentucky and middle Tennessee. The Company has two additional operating divisions including Heritage Wealth Management of Murray,Kentucky, Hopkinsville, Kentucky, and Pleasant View,Tennessee, which offers a broad line of financial services. Heritage Mortgage Services of Clarksville, Tennessee, offers long term fixed rate 1- 4 family mortgages loans that are originated for the secondary market in all communities in the Company’s general market area. The Bank offers a broad line of banking and financialproducts and services with the personalized focus of a community banking organization. More information about HopFed Bancorpand Heritage Bank USA, Inc. may be found on its website www.bankwithheritage.com.  Forward-Looking Information  Information contained in this press release, other than historical information, may be considered forward-looking in nature andis subject to various risk, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize, orshould the underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated orexpected. Among the key factors that may have a direct bearing on the Company’s operating results, performance or financial condition are competition and the demand for the Company’s products and services, and other factors as set forth infilings with the Securities and Exchange Commission. The Company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations. Certain tabular presentations may not reconcile because of rounding.       HOPFED BANCORP, INC. Consolidated Balance Sheets (Dollars in thousands)   Assets                                       March 31, 2014   December 31,                                                                   2013                                                (unaudited)                                                                    Cash and due from banks                        $    25,449        37,229 Interest-earning deposits                          8,730         18,619 Cash and cash equivalents                           34,179        55,848 Federal Home Loan Bank stock, at cost               4,428         4,428 Securities available for sale                       341,538       318,910 Loans held for sale                                 152           --- Loans receivable, net of allowance for loan losses of $8,913 at March 31, 2014,            535,951       543,632 and $8,682 at December 31, 2013 Accrued interest receivable                         4,447         5,233 Real estate and other assets owned                  1,680         1,674 Bank owned life insurance                           9,764         9,677 Premises and equipment, net                         23,063        23,108 Deferred tax assets                                 3,327         4,610 Intangible asset                                    97            130 Other assets                                       6,398         6,399 Total assets                                   $    965,024       973,649                                                                                                                                       Liabilities and Stockholders' Equity Liabilities: Deposits: Non-interest-bearing accounts                  $    105,848       105,252 Interest-bearing accounts Interest-bearing checking accounts                  190,804       183,643 Savings and money market accounts                   93,780        92,106 Other time deposits                                371,094       381,996 Total deposits                                      761,526       762,997                                                                    Advances from Federal Home Loan Bank                41,280        46,780 Repurchase agreements                               50,129        52,759 Subordinated debentures                             10,310        10,310 Advances from borrowers for taxes and               572           521 insurance Dividends payable                                   309           326 Accrued expenses and other liabilities             3,385         4,239 Total liabilities                                  867,511       877,932   This information is preliminary and based on company data available at the time of the presentation.         HOPFED BANCORP, INC. Consolidated Balance Sheets, Continued (Dollars in thousands)                                           March 31, 2014   December 31, 2013                                           (unaudited)                                                               Stockholders' equity Preferred stock, par value $0.01 per share; authorized - 500,000 shares;          ---             --- no shares issued and outstanding at March 31, 2014, and December 31, 2013 Common stock, par value $.01 per share; authorized 15,000,000 shares; 7,927,287 issued and 7,437,517 outstanding at March           79              79 31, 2014, and 7,927,287 issued and 7,447,903 outstanding at December 31, 2013 Additional paid-in-capital                   58,333          58,302 Retained earnings                            44,753          44,694 Treasury stock- common (at cost, 489,770 shares at March 31, 2014, and        (6,049   )      (5,929      ) 479,384 shares at December 31, 2013) Accumulated other comprehensive             397            (1,429      ) income (loss), net of taxes                                                               Total stockholders' equity                  97,513         95,717                                                                     Total liabilities and stockholders'       $  965,024        973,649      equity   This information is preliminary and based on company data available at the time of the presentation.        HOPFED BANCORP, INC. Consolidated Condensed Statements of Income (Dollars in thousands) Unaudited                                             For the Three Month Periods                                             Ended March 31,                                                                                                              2014                      2013 Interest and dividend income: Loans receivable                            $      6,327              6,882 Investment in securities, taxable                  1,779              1,832 Nontaxable securities available                    544                585 for sale Interest-earning deposits                         8                  6 Total interest and dividend                       8,658              9,305 income                                                                        Interest expense: Deposits                                           1,471              2,046 Advances from Federal Home Loan                    434                444 Bank Repurchase agreements                              249                242 Subordinated debentures                           184                182 Total interest expense                            2,338              2,914                                                                        Net interest income                               6,320              6,391 Provision for loan losses                         380                376                                                                        Net interest income after provision for loan losses                         5,940              6,015                                                                        Non-interest income: Service charges                                    778                853 Merchant card income                               259                223 Mortgage origination revenue                       58                 200 Gain on sale of securities                         13                 627 Income from bank owned life                        95                 75 insurance Financial services commission                      206                297 Other operating income                            189                208 Total non-interest income                         1,598              2,483   This information is preliminary and based on company data available at the time of the presentation.        HOPFED BANCORP, INC. Consolidated Condensed Statements of Income, Continued (Dollars in thousands, except share and per share data) (Unaudited)                                         For the Three Month Periods                                         Ended March 31,                                                                                                       2014                     2013 Non-interest expenses: Salaries and benefits                   $   3,795                   3,848 Occupancy expense                           909                     845 Data processing expense                     728                     650 State deposit tax                           246                     142 Intangible amortization expense             32                      49 Professional services expense               314                     393 Deposit insurance and                       287                     232 examination expense Advertising expense                         197                     333 Postage and communications                  143                     139 expense Supplies expense                            145                     136 Loss on sale of real estate                 23                      35 owned Real estate owned expenses                  130                     76 Other operating expenses                   375                   396 Total non-interest expense                 7,324                 7,274                                                                   Income before income tax                    214                     1,224 expense Income tax expense                         (140        )          240                                                                   Net income                              $   354                   984 Net income per share: Basic                                   $   0.05                $  0.13 Fully diluted                           $   0.05                $  0.13 Dividend per share                      $   0.04                $  0.02                                                                   Weighted average shares                    7,416,716             7,488,445 outstanding - basic Weighted average shares                    7,416,716             7,488,445 outstanding - diluted   This information is preliminary and based on company data available at the time of the presentation.        HOPFED BANCORP, INC. Selected Financial Data (Dollars in thousands)                                   For the Three Months Ended                                                                   Change from                                   3/31/2014       12/31/2013     Prior Quarter                                                                   Interest and dividend income: Loans receivable                  $    6,327      6,578          (251     ) Investment in securities,              1,779      1,636          143 taxable Nontaxable securities                  544        543            1 available for sale Interest-earning deposits             8          6              2         Total interest and dividend           8,658      8,763          (105     ) income                                                                   Interest expense: Deposits                               1,471      1,510          (39      ) Advances from Federal Home             434        445            (11      ) Loan Bank Repurchase agreements                  249        237            12 Subordinated debentures               184        185            (1       ) Total interest expense                2,338      2,377          (39      )                                                                   Net interest income                   6,320      6,386          (66      ) Provision for loan losses             380        396            (16      )                                                                   Net interest income after             5,940      5,990          (50      ) provision for loan losses                                                                   Non-interest income: Service charges                        778        931            (153     ) Merchant card income                   259        256            3 Mortgage origination revenue           58         75             (17      ) Gain on sale of securities             13         44             (31      ) Income from bank owned life            95         103            (8       ) insurance Financial services commission          206        292            (86      ) Gain on sale of assets                 ---        412            (412     ) Other operating income                189        179            10                                                                          Total non-interest income             1,598      2,292          (694     )   This information is preliminary and based on company data available at the time of the presentation        HOPFED BANCORP, INC. Selected Financial Data (Dollars in thousands, except share and per share data)                              Months Ended                                                                                      Change from                              3/31/2014         12/31/2013        Prior Quarter                                                                   Non-interest expenses: Salaries and benefits        $ 3,795             3,436           359 Occupancy expense              909               870             39 Data processing expense        728               747             (19       ) State deposit tax              246               149             97 Intangible amortization        32                32              --- expense Professional services          314               338             (24       ) expense Deposit insurance and          287               179             108 examination expense Advertising expense            197               303             (106      ) Postage and                    143               140             3 communications expense Supplies expense               145               107             38 Loss on sale of other          ---               12              (12       ) assets Loss on sale of real           23                147             (124      ) estate owned Real estate owned              130               216             (86       ) expenses Other operating expenses      375             580            (205      )                                                                   Total non-interest            7,324           7,256          68         expense                                                                   Income before income tax       214               1,026           (812      ) expense Income tax expense            (140      )      (50       )     (90       )                                                                   Net income                   $ 354             1,076          (722      ) Net income (loss) available (attributable) to common stockholders Per share, basic             $ 0.05           $ 0.14           (0.09     ) Per share, diluted           $ 0.05           $ 0.14           (0.09     ) Dividend per share           $ 0.04           $ 0.04                                                                         Weighted average shares       7,416,716       7,430,970  outstanding - basic Weighted average shares       7,416,716       7,430,970  outstanding - diluted   This information is preliminary and based on company data available at the time of the presentation.        HOPFED BANCORP, INC. Selected Financial Data  The table below adjusts tax-free investment income for the three month periods ended March 31, 2014, and March 31, 2013, by $266,000 and $282,000, respectively, for a tax equivalent rate using a cost of funds rate of 1.20 for the three month period ended March 31, 2014, and 1.50% for the three month period ended March 31, 2013. The table adjusts tax-free loan income by $1,000 for three month periods ended March 31, 2014, and March 31, 2013, respectively, for a tax equivalent rate using the same cost of funds rate:                  Average      Income &     Average      Average      Income &     Average                   Balance        Expense        Rates          Balance        Expense        Rates                   03/31/2014     03/31/2014     03/31/2014     03/31/2013     03/31/2013     03/31/2013                                                                                               Loans             $  532,720     $  6,328       4.75   %       $  522,705     $  6,883       5.27   % Investments          266,780        1,779       2.67   %          284,378        1,832       2.58   % AFS taxable Investments          67,294         810         4.81   %          75,689         867         5.15   % AFS tax free Interest earning             12,569        8          0.25   %         9,882         6          0.24   % deposits                                                                                               Total interest             879,363       8,925      4.06   %          892,654       9,588      4.30   % earning assets                                                                                               Other assets        84,187                                      85,058                                                                                               Total assets      $  963,550                                   $  977,712                                                                                                                                                                                                                                                                                           Retail time       $  332,033        963         1.16   %       $  384,815        1,499       1.56   % deposits Brokered             46,119         145         1.26   %          47,100         184         1.56   % deposits Interest bearing              184,114        321         0.70   %          164,074        330         0.80   % checking accounts MMDA and savings              93,325         42          0.18   %          80,687         33          0.16   % accounts FHLB                 45,808         434         3.79   %          43,558         444         4.08   % borrowings Repurchase           49,362         249         2.02   %          43,032         242         2.25   % agreements Subordinated        10,310        184        7.14   %         10,310        182        7.06   % debentures                                                                                               Total interest             761,071       2,338      1.23   %          773,576       2,914      1.51   % bearing liabilities                                                                                               Non-interest bearing              100,237                                      94,100 deposits Other non-interest         4,429                                        4,989 bearing liabilities                                                                                               Stockholders'       97,813                                      105,047 equity                                                                                               Total liabilities and               $  963,550                                   $  977,712 stockholders' equity                                                                                               Net change in interest earning assets and                       $  6,587                                    $  6,674  interest bearing liabilities Interest rate                                   2.83   %                                     2.79   % spread Net interest                       3.00  %                                     2.99  % margin   This information is preliminary and based on company data available at the time of the presentation.    Contact:  HopFed Bancorp, Inc. John E. Peck, 270-885-1171 President and CEO  
Press spacebar to pause and continue. Press esc to stop.