Ameriana Bancorp Reports Net Income of $383,000 or $0.13 Per Share for the Quarter Ended March 31, 2008
NEW CASTLE, Ind.--(Business Wire)--
Ameriana Bancorp (NASDAQ:ASBI) today announced net income of
$383,000 or $0.13 per basic and diluted share for the quarter ended
March 31, 2008, reversing a net loss of $24,000 or $0.01 per basic and
diluted share in the year-earlier period.
The quarter included continued growth in Ameriana's loan portfolio
and ongoing improvement in its net interest margin, both of which
contributed to higher net interest income for the quarter. Also, in
the first quarter of 2008, the Company reported a reduction in other
expense as well as a benefit from the resolution of a long-standing
tax issue. These overall improvements were partially offset by a
higher provision for loan losses in the first quarter compared with
the same period last year, as Ameriana maintained a conservative
posture toward potential risk in its loan portfolio in light of
current economic pressures and the recent rise in the level of
non-performing loans.
Commenting on the results, Jerome J. Gassen, President and Chief
Executive Officer, said, "We are pleased that our growth strategies
continue to translate into improved business fundamentals, leading to
ongoing loan and deposit growth in the first quarter of 2008 and
extending the success we achieved last year. These accomplishments are
particularly noteworthy considering the current competitive
environment. Furthermore, our higher net interest margin for the first
quarter demonstrates the positive impact of our asset and liability
management efforts, and our ability to react quickly to declining
interest rate levels. We believe this progress, coupled with the
acceleration of our expansion activities, gives us a solid start to
2008 and provides the foundation for improved performance over the
longer term."
Ameriana's higher earnings for the first quarter of 2008 reflects
growth in the Company's loan portfolio. A greater focus on commercial
lending remains at the heart of this success, contributing a 20%
increase in the Company's commercial loan portfolio over the past year
and driving a 12% overall increase in the total loan portfolio since
March 31, 2007.
In terms of physical expansion, Gassen noted that Ameriana
recently announced plans to open two new full-service banking centers
in Hamilton County, which lies just north of Marion County and
Indianapolis. The new offices in Fishers and Carmel, expected to open
in October 2008 and January 2009, respectively, will enhance
Ameriana's presence in one of the fastest growing areas of Indiana,
considerably increase its footprint in the Indianapolis area, and
boost the Company's overall visibility in this market.
Net interest income for the first quarter of 2008 increased 17% to
$2,725,000 from $2,333,000 in the year-earlier period. This reflected
the positive effects of the Company's balance sheet restructuring
strategies that began in late 2006, Ameriana's increased emphasis on
commercial lending and its higher yields, and efforts to reduce
funding costs quickly in a declining-rate environment. Net interest
margin on a fully tax-equivalent basis for the first quarter was
2.97%, up seven basis points from 2.90% in the fourth quarter of 2007
and 36 basis points ahead of 2.61% in the year-earlier quarter.
Although the Company has no exposure to sub-prime lending products
in its loan portfolio, the Company's overall credit quality showed the
increasing pressure of current macroeconomic conditions in the first
quarter. Non-performing loans at March 31, 2008 totaled $4,557,000, up
$1,919,000 from $2,638,000 at December 31, 2007 and $1,028,000 from
$3,529,000 at March 31, 2007. The increase from December 31, 2007 was
related primarily to five real estate development loans in the Hancock
County, Indiana area totaling $1,275,000 that represented two
long-time lending relationships. Ameriana increased its provision for
loan losses to $371,000 for the first quarter compared with $90,000 in
the year-earlier period to reflect the increase in non-performing
loans and the growth in the loan portfolio. The Company's allowance
for loan losses totaled 0.97% of total loans as of March 31, 2008,
versus 0.90% at December 31, 2007 and 1.02% at March 31, 2007.
Other income for the first quarter of 2008 was $1,141,000, up 16%
from $985,000 in the same quarter in 2007, primarily due to higher
commissions from insurance sales and a $49,000 pre-tax gain from the
partial redemption of the Company's equity interest in Visa realized
through Visa's recent initial public offering. Other expense for the
first quarter declined 4% to $3,392,000 from $3,545,000 in the same
quarter last year, largely due to lower compensation costs this year
reflecting severance costs incurred last year, lower legal and
professional fees with the mid-2007 conclusion of the Company's
litigation with RLI, and non-recurring recruiting costs incurred in
the first quarter of 2007.
For the first quarter of 2008, the Company's earnings included a
$280,000 income tax benefit. This was due primarily to the significant
amount of tax-exempt interest on municipal securities, tax-exempt
income from increases in the cash value of life insurance, and a
$150,000 reversal of an income tax liability recorded in prior years
that resulted from a favorable tax court ruling regarding the
application of the Tax Equity and Fiscal Responsibility Act penalty to
investment subsidiaries of commercial banks.
Ameriana's total assets were $445,306,000 at March 31, 2008, up 4%
from $426,791,000 at December 31, 2007, and up 2% from $436,995,000 at
March 31, 2007. The Company's loan portfolio increased 1% to
$298,467,000 at March 31, 2008 from $296,951,000 at December 31, 2007
and was up 12% from $265,706,000 at March 31, 2007. Investment
securities totaled $80,147,000 at March 31, 2008, up 20% from
$66,692,000 at December 31, 2007, but down 32% from $117,430,000 at
March 31, 2007, as proceeds from the repositioning and reduction of
the Company's investment portfolio last year were used to support
Ameriana's growing focus on higher-yielding commercial loans. The
growth of the investment securites portfolio in the first quarter of
2008 came from the addition of $15 million of Fannie Mae
mortgage-backed securities funded at an attractive spread with FHLB
fixed-rate advances.
Total deposits rose 2% to $322,402,000 at March 31, 2008, from
$314,746,000 at December 31, 2007, and were up 1% from $319,366,000 at
March 31, 2007. Shareholders' equity totaled $33,180,000 at March 31,
2008, versus $33,989,000 at December 31, 2007, and $32,396,000 at
March 31, 2007. The decrease in capital for the first quarter of 2008
was a result of the Company recording a liability for post-retirement
benefits as required under EITF Issues 06-04 and 06-10. Ameriana's
capital position continues to exceed all of the regulatory minimum
capital levels required to be considered a "well-capitalized"
institution.
Ameriana Bancorp is a bank holding company. Through its wholly
owned subsidiary, Ameriana Bank, SB, the Company offers an extensive
line of banking services and provides a range of investments and
securities products through banking centers in the central Indiana
area. Ameriana owns Ameriana Insurance Agency, a full-service
insurance agency, and has interests in Family Financial Holdings, Inc.
and Indiana Title Insurance Company. Ameriana Financial Services
offers securities and insurance products through LPL Financial (Member
FINRA/SIPC).
This news release contains forward-looking statements within the
meaning of the federal securities laws. Statements in this release
that are not strictly historical are forward-looking and are based
upon current expectations that may differ materially from actual
results. These forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially
from those anticipated by the statements made herein. These risks and
uncertainties involve general economic trends, changes in interest
rates, loss of deposits and loan demand to other financial
institutions, substantial changes in financial markets, changes in
real estate value and the real estate market, regulatory changes,
possibility of unforeseen events affecting the industry generally, the
uncertainties associated with newly developed or acquired operations,
the outcome of pending litigation, and market disruptions and other
effects of terrorist activities. For discussion of these and other
risks that may cause actual results to differ from expectations, refer
to the Company's Annual Report on Form 10-K for the year ended
December 31, 2007, on file with the Securities and Exchange
Commission, including the section entitled "Risk Factors." The Company
undertakes no obligation to update these forward-looking statements to
reflect events or circumstances after the date hereof or to reflect
the occurrence of unforeseen events, except as required under the
rules and regulations of the Securities and Exchange Commission.
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AMERIANA BANCORP
Unaudited Financial Highlights
(In thousands, except per share amounts)
Three Months Ended
March 31
------------------
2008 2007
-------- --------
Interest income $ 5,935 $ 5,890
Interest expense 3,210 3,557
-------- --------
Net interest income 2,725 2,333
Provision for loan losses 371 90
-------- --------
Net interest income after provision for loan losses 2,354 2,243
Other income 1,141 985
Other expense 3,392 3,545
-------- --------
Income (loss) before income taxes 103 (317)
Income tax benefit (280) (293)
-------- --------
Net income (loss) $ 383 $ (24)
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Basic and diluted earnings (loss) per share $ 0.13 $ (0.01)
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Weighted average shares outstanding:
Basic 2,989 3,032
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Diluted 2,989 3,032
======== ========
Dividends declared per share $ 0.04 $ 0.04
======== ========
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March 31 Dec. 31 March 31
2008 2007 2007
--------- --------- ---------
Total assets $445,306 $427,134 $436,996
Cash and cash equivalents 17,272 17,173 9,563
Investment securities available for sale 80,147 66,692 117,430
Loans receivable 298,467 296,951 265,706
Allowance for loan losses 2,909 2,677 2,707
--------- --------- ---------
Loans, net 295,558 294,274 262,999
Allowance for loan losses as a
percentage of loans receivable 0.97% 0.90% 1.02%
Non-performing loans $ 4,557 $ 2,638 $ 3,529
Allowance for loan losses as a
percentage of non-performing loans 63.8% 101.5% 76.7%
Deposits:
Non-interest bearing 23,206 20,429 19,991
Interest bearing 299,196 294,317 299,376
--------- --------- ---------
322,402 314,746 319,367
Borrowed funds 81,235 68,513 76,634
Shareholders' equity 33,180 33,989 32,396
Loans accounted for on a non-accrual
basis 4,157 2,638 3,528
Book value per share 11.10 11.37 10.84
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Ameriana Bancorp
Jerome J. Gassen
President and Chief Executive Officer
765-529-2230
Copyright Business Wire 2008
