Profile: HopFed Bancorp Inc (HFBC.OQ)
24 Jun 2019
HopFed Bancorp, Inc., incorporated on May 29, 1997, is a savings and loan holding company that operates through its subsidiary, Heritage Bank USA, Inc. (the Bank). The Bank is a Kentucky state chartered commercial bank with branch offices in Kentucky and Tennessee. The business of the Bank primarily consists of attracting deposits from the general public and investing such deposits in loans secured by single family residential real estate and investment securities, including the United States Government and agency securities, municipal and corporate bonds, collateralized mortgages obligations (CMOs), and mortgage-backed securities. The Bank also originates single-family residential/construction loans, and multi-family and commercial real estate loans, as well as loans secured by deposits, other consumer loans and commercial loans. The Bank's Kentucky locations include Hopkinsville, Murray, Cadiz, Elkton, Fulton, Calvert City and Benton. The Tennessee locations include Clarksville, Pleasant View, Ashland City, Kingston Springs and Erin. The primary market area of the Bank consists of the adjacent counties of Calloway, Christian, Todd, Trigg, Fulton, and Marshall located in southwestern Kentucky and Montgomery, Cheatham, Houston, Davidson, Obion and Weakley counties located in Tennessee.
The Bank's total gross loan portfolio totaled approximately $562.5 million, representing 62.3% of total assets at that date. The Bank's loan portfolio consists of one- to four-family, residential mortgage loans. Other loans secured by real estate include non-residential real estate loans amounted to approximately $214.4 million and multi-family residential loans amounted to approximately $24.7 million. The Bank's construction loans amounted to approximately $34.9 million, and total consumer and commercial loans totaled approximately $107.1 million. The Bank is an originator of one- to four-family residential real estate loans in its market area. The Bank's one- to four-family residential mortgage loans totaled approximately $181.4 million. The Bank primarily originates residential mortgage loans with adjustable rates.
The Bank's one- to four-family loan portfolio consists of closed end first and second mortgages, as well as opened ended home equity lines of credit. The Bank engages in construction lending involving loans to individuals for construction of one- to four-family residential housing, multi-family housing and non-residential real estate located within the Bank's market area, with such loans converting to permanent financing upon completion of construction. The Bank's loan portfolio included approximately $34.9 million of loans secured by properties under construction, including construction/permanent loans structured to become permanent loans upon the completion of construction and interim construction loans structured to be repaid in full upon completion of construction and receipt of permanent financing. The Bank's multi-family residential loan portfolio consists of fixed and adjustable rate loans secured by real estate. The Bank had approximately $24.7 million of multi-family residential loans. The Bank's non-residential real estate loans consisted of approximately $42.2 million in farmland, approximately $67.4 million in non-owner occupied properties, and approximately $82.3 million in owner occupied commercial real estate and approximately $22.4 million in raw land. The consumer loans in the Bank's loan portfolio consist of loans secured by savings deposits and other consumer loans. The Bank's loans on deposit accounts totaled approximately $14.1 million. Other consumer loans include automobile loans, the amount and terms of which are determined by management, and closed end home equity and home improvement loans. The Bank's all other consumer loans accounts totaled approximately $6.2 million. The Bank originates commercial loans on a secured and, to a lesser extent, unsecured basis. The Bank's commercial loans amounted to approximately $86.7 million. The Bank's net loans amounted to approximately $560 million.
The investment activities of the Bank consist primarily of investments in the United States Government agency securities, municipal and corporate bonds, CMOs and mortgage-backed securities. Typical investments include federally sponsored agency mortgage pass-through and federally sponsored agency and mortgage-related securities. The Bank's securities with an amortized cost of approximately $233.4 million and an approximate market value of $237.2 million were classified as available for sale. Mortgage-backed securities represent a participation interest in a pool of one- to four-family or multi-family mortgages, the principal and interest payments, on which are passed from the mortgage originators through intermediaries that pool and repackage the participation interest in the form of securities to investors, such as the Bank. The Company owns approximately $3.7 million in securities collateralized by federally insured student loans. The Bank's securities available for sale amounted to approximately $240 million.
Sources of Funds
Deposits are the primary source of the Bank's funds for lending, investment activities and general operational purposes. In addition to deposits, the Bank derives funds from loan principal and interest repayments, maturities of investment securities and mortgage-backed securities and interest payments thereon. The Bank attracts deposits principally from within its market area by offering various deposit instruments, including money market accounts, passbook savings accounts, individual retirement accounts, and certificates of deposit that range in maturity from 3 months to 5 years. The Bank has, on a limited basis, utilized brokered deposits to augment its funding requirements. The Bank had approximately $34.4 million in brokered deposits. The Bank's total time deposits amounted to approximately $314.7 million. The Bank is authorized to use advances from the Federal Home Loan Bank (FHLB) of Cincinnati to supplement its supply of lendable funds and to meet deposit withdrawal requirements. Advances from the FHLB of Cincinnati amounted to over $10 million.
The Bank owns JBMM, LLC, a limited liability company, owns and manages the Bank's other real estate and other assets owned. The Bank owns Heritage Interim Corporation, a Tennessee corporation established to facilitate the acquisition of a bank in Tennessee. The Bank owns Heritage USA Title, LLC, which sells title insurance to the Bank's real estate loan customers. The Bank owns Fort Webb LLLP, LLC, which owns a limited partnership interest in Fort Webb LLLP, a low income senior citizen housing facility in Bowling Green, Kentucky.
The Company competes with Planters Bank, Community Financial Services Bank, U.S. Bank N/A, Branch Bank & Trust and Regions Bank.
HopFed Bancorp Inc
4155 Lafayette Rd
HOPKINSVILLE KY 42240-5366