Kentucky First Federal Bancorp Releases Earnings

Kentucky First Federal Bancorp Releases Earnings

HAZARD, Ky., FRANKFORT, Ky., DANVILLE, Ky. and LANCASTER, Ky., Feb. 07, 2018
(GLOBE NEWSWIRE) -- Kentucky First Federal Bancorp (Nasdaq:KFFB), the holding
company for First Federal Savings and Loan Association of Hazard and First
Federal Savings Bank of Kentucky, announced net earnings of $869,000 or $0.11
diluted earnings per share for the three months ended December 31, 2017,
compared to net earnings of $254,000 or $0.03 diluted earnings per share for
the three months ended December 31, 2016, an increase of $615,000 or 242.1%.
  Net earnings were $1.1 million or $0.14 diluted earnings per share for the
six months ended December 31, 2017, compared to net earnings of $551,000 or
$0.07 diluted earnings per share for the six months ended December 31, 2016,
an increase of $598,000 or 108.5%.

The increase in net earnings on a quarter-to-quarter basis was primarily
attributable to increased non-interest income and lower income tax expense. 

Non-interest income increased $360,000 to $436,000 for the three months ended
December 31, 2017, compared to the prior year quarter, primarily because of an
increase in earnings on bank-owned life insurance (“BOLI”).  During the
quarter just ended the Bank received BOLI insurance proceeds on policies
maintained under its long-standing overall employee benefits program pursuant
to the passing of a covered individual.

The Company recorded a net income tax benefit of $160,000 for the three months
ended December 31, 2017, compared to federal income tax expense of $139,000 in
the prior year quarter.  The decrease in income tax expense was primarily
related to a change in income tax law.  Recently-enacted tax reform has
reduced the top income tax rate for corporations beginning January 1, 2018. 
Under U.S. Generally Accepted Accounting Principles the effect of changes in
tax laws or rates is recognized in income tax expense in the period in which
the legislation is enacted.  The Company recognized an income tax benefit of
approximately $268,000 related to lower tax rates expected to be applied to
its net deferred tax liabilities in the future.

Net interest income before provision for loan losses increased $12,000 or 0.5%
to $2.5  million  for  the  three-month period  just  ended.  Interest  income 
increased by  $173,000,  or 6.2%,  to  $3.0 million,  while  interest  expense 
increased $161,000 or 47.2%  to $502,000 for the  three months ended  December 
31, 2017.  Costs associated with the Company’s funding sources are  increasing 
as short-term interest rates continue to rise.  The Company recorded a  $3,000 
provision for losses on loans during the three months ended December 31, 2017,
compared to a  provision of $52,000  for the three  months ended December  31, 
2016.  Non-interest  expense  increased  $105,000 or  5.0%  and  totaled  $2.2 
million for the three months ended December 31, 2017.

The increase in net earnings on a six-month basis was also primarily
attributable to increased non-interest income and lower income tax expense. 

Non-interest income increased $332,000 to $576,000 for the six months ended
December 31, 2017, compared to the prior year quarter, primarily because of an
increase in BOLI earnings.  Federal income taxes decreased $324,000 or 108.4%
as the Company’s income tax benefit totaled $25,000 for the recently-ended
six-month period compared to income tax expense of $299,000 in the prior year
period, primarily because of the change in income tax law.

Net interest income before provision for loan losses decreased $16,000 or 0.3%
to $4.9 million for the six-month period just ended. Interest income increased
by $285,000,  or  5.1%, to  $5.9  million, while  interest  expense  increased 
$301,000 or 45.0% to $970,000 for the six months ended December 31, 2017.  The
Company recorded a $3,000 provision for losses on loans during the six  months 
ended December 31, 2017, compared to a provision of $56,000 for the six months
ended December 31, 2016.  Non-interest  expense increased $95,000 or 2.2%  and 
totaled $4.4 million for the six months ended December 31, 2017.

At December 31, 2017 assets increased $955,000 or 0.3% to $309.4 million
compared to $308.5 million at June 30, 2017.  This increase is attributable
primarily to increases in loans and time deposits, which were partially offset
by a decrease in cash and cash equivalents.  Total liabilities increased
$436,000 or 0.2% to $241.8 million at December 31, 2017, primarily as a result
of an increase in deposits, which increased $8.5 million or 4.6% to $191.3
million at December 31, 2017.  The Company has been successful in competing
for and attracting deposits in its local markets as short-term interest rates
have risen.  FHLB advances decreased $7.2 million or 12.8% and totaled $48.6
million at quarter end. 

At December 31, 2017, the Company reported its book value per share as $8.01.

This press release may contain statements that are forward-looking, as that
term is defined by the Private Securities Litigation Act of 1995 or the
Securities and Exchange Commission in its rules, regulations and releases. 
The Company intends that such forward-looking statements be subject to the
safe harbors created thereby.  All forward-looking statements are based on
current expectations regarding important risk factors including, but not
limited to, real estate values, the impact of interest rates on financing,
changes in general economic conditions, legislative and regulatory changes
that adversely affect the business of the Company, changes in the securities
markets and the Risk Factors described in Item 1A of the Company’s Annual
Report on Form 10-K for the year ended June 30, 2017.  Accordingly, actual
results may differ from those expressed in the forward-looking statements, and
the making of such statements should not be regarded as a representation by
the Company or any other person that results expressed therein will be
achieved.

Kentucky First Federal Bancorp is the parent company of First Federal Savings
and Loan Association, which operates one banking office in Hazard, Kentucky,
and First Federal Savings Bank, which operates six banking offices in
Kentucky, including three in Frankfort, two in Danville, and one in
Lancaster.  Kentucky First Federal Bancorp shares are traded on the Nasdaq
National Market under the symbol KFFB.  At December 31, 2017, the Company had
approximately 8,444,515 shares outstanding of which approximately 56.0% was
held by First Federal MHC.

                                                                           
  SUMMARY OF FINANCIAL HIGHLIGHTS                                          
  Condensed Consolidated Balance Sheets                                    
                                       December 31,           June 30,     
                                       2017                   2017         
                                                  (In thousands, except    
                                       share data)
                                         (Unaudited)                       
Assets                                                                     
  Cash and Cash Equivalents         $  9,360         $        12,804       
  Time deposits in other financial     6,681                  4,201        
  institutions
  Investment Securities                1,315                  1,558        
  Loans Held for Sale                  240                    --           
  Loans, net                           260,806                258,244      
  Real estate acquired through         806                    358          
  foreclosure
  Other Assets                         30,232                 31,320       
  Total Assets                      $  309,440       $        308,485      
Liabilities                                                                
  Deposits                          $  191,303       $        182,845      
  FHLB Advances                        48,627                 55,780       
  Deferred revenue                     567                    578          
  Other Liabilities                    1,278                  2,136        
  Total Liabilities                    241,775                241,339      
Shareholders' Equity                   67,665                 67,146       
Total Liabilities and Equity        $  309,440       $        308,485      
Book Value Per Share                $  8.01          $        7.95         
                                                                               
                                                   
  Condensed
  Consolidated                                                               
  Statements of Income
  (In
  thousands,                                                                   
  except share
  data)
                 Six months ended December      Three months ended December    
                 31,                            31,
                 2017           2016            2017                2016       
                   (Unaudited)                    (Unaudited)                  
  Interest     $ 5,885        $ 5,600         $ 2,984        $      2,811      
  Income
  Interest       970            669             502                 341        
  Expense
  Net Interest   4,915          4,931           2,482               2,470      
  Income
  Provision
  for Losses     3              56              3                   52         
  on Loans
  Non-interest   576            244             436                 76         
  Income
  Non-interest   4,364          4,269           2,206               2,101      
  Expense
  Income
  Before         1,124          850             709                 393        
  Income Taxes
  Income Taxes   (25       )    299             (160      )         139        
  Net Income   $ 1,149       $  551          $  869          $      254        
  Earnings per                                                                 
  share:
  Basic and    $ 0.14        $  0.07         $  0.11         $      0.03       
  diluted
  Weighted
  average                                                                      
  outstanding
  shares:
  Basic and      8,361,941      8,382,239       8,364,276           8,384,586  
  diluted
                                                                               

Contact:         
Kentucky First Federal Bancorp
Don Jennings, President
Clay Hulette, Vice President
(502) 223-1638

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