Territorial Bancorp Inc. (NASDAQ:TBNK) (the “Company”),
headquartered in Honolulu, Hawaii, the holding company parent of
Territorial Savings Bank, announced net income of $4.04 million or
$0.43 per diluted share for the three months ended June 30, 2016,
compared to $3.84 million or $0.41 per diluted share for the three
months ended June 30, 2015.
The Company also announced that its Board of Directors approved
a quarterly cash dividend of $0.18 per share. The dividend is
expected to be paid on August 26, 2016 to stockholders of record as
of August 12, 2016.
Allan Kitagawa, Chairman and Chief Executive Officer, said,
“Hawaii’s strong economy has allowed us to grow our loan portfolio
by 13.4% from June 30, 2015 to June 30, 2016. The solid
growth in our loan portfolio has resulted in a 5.2% rise in net
income for the three months ended June 30, 2016 compared to the
same period last year. Our strong performance will allow us
to pay our 27th consecutive dividend.”
Interest Income
Net interest income after provision for loan losses increased to
$14.52 million for the three months ended June 30, 2016 from $13.96
million for the three months ended June 30, 2015. Total interest
and dividend income was $16.54 million for the three months ended
June 30, 2016 compared to $15.61 million for the three months ended
June 30, 2015. The increase in interest and dividend income was
primarily due to a $1.38 million increase in interest earned on
loans, which occurred because of the $148.52 million growth in
loans receivable as new loan originations exceeded loan repayments
and loan sales. The increase in interest income on loans was
offset by a $524,000 decline in interest income on investment
securities due to a $69.72 million decrease in the investment
securities portfolio as repayments and sales exceeded securities
purchased.
Interest Expense and Provision for Loan
Losses
Total interest expense increased to $1.94 million for the three
months ended June 30, 2016 from $1.55 million for the three months
ended June 30, 2015. Interest expense on deposits increased
to $1.47 million for the three months ended June 30, 2016 from
$1.15 million for the three months ended June 30, 2015. The
increase in interest expense on deposits occurred because of the
$96.38 million growth in total deposits over the past year.
Interest expense on advances from the Federal Home Loan Bank rose
by $99,000 due to a $12.00 million increase in Federal Home Loan
Bank advances, which was primarily used to fund new loans.
For the three months ended June 30, 2016, the provision for loan
losses was $84,000 compared to a $101,000 provision for the three
months ended June 30, 2015.
Noninterest Income
Noninterest income was $1.13 million for the three months ended
June 30, 2016 compared to $1.25 million for the three months ended
June 30, 2015. The reduction in noninterest income was
primarily due to a $54,000 decrease in service fees on loans and
deposit accounts and a $50,000 decrease in the gain on sale of
investment securities for the three months ended June 30, 2016 as
compared to the three months ended June 30, 2015.
Noninterest Expense
Noninterest expense was $8.99 million for the three months ended
June 30, 2016 compared to $8.84 million for the three months ended
June 30, 2015. Salaries and employee benefits was $5.26
million for the three months ended June 30, 2016 compared to $5.06
million for the three months ended June 30, 2015. The
increase in salaries and employee benefits expense is primarily due
to the increased staffing to handle the additional workload
associated with an increase in regulatory requirements. A decrease
in the number of loans originated in the three months ended June
30, 2016 compared to June 30, 2015 also increased salaries and
benefit expense. As new loans are originated, the Bank
capitalizes the cost of new loan originations as part of the loan
and reduces salary expense. The reduction in loan volume for
the three months ended June 30, 2016 lowered capitalized loan costs
and increased salary expense. The increase in salaries and
employee benefits expense can also be attributed to an increase in
ESOP expense, health insurance and pension expense.
Assets and Equity
Total assets increased to $1.851 billion at June 30, 2016 from
$1.821 billion at December 31, 2015. Loans receivable grew by
$70.69 million or 6.0% to $1.259 billion at June 30, 2016 from
$1.189 billion at December 31, 2015 as residential mortgage loan
originations exceeded loan repayments and sales. The growth in
loans receivable was funded primarily by a $24.65 million increase
in deposits and a $37.07 million decrease in investment
securities. Deposits increased to $1.470 billion at June 30,
2016 from $1.445 billion at December 31, 2015. Investment
securities declined to $455.99 million at June 30, 2016 from
$493.06 million at December 31, 2015 as repayments and the sale of
securities exceeded new purchases. Total stockholders’ equity
increased to $225.72 million at June 30, 2016 from $219.64 million
at December 31, 2015. The increase in stockholders’ equity
occurred as the Company’s net income for the year exceeded share
repurchases and dividends paid to shareholders.
Share Repurchases
Through June 30, 2016, the Company had repurchased 3,138,153
shares of stock or 25.65% of the shares issued in its initial
public offering in 2009. During the first quarter of 2016, the
Company announced the adoption of its seventh share repurchase
program of up to 275,000 shares, or approximately 3% of the current
outstanding shares. The Company uses share repurchases as
part of its overall program to enhance shareholder value. In
evaluating our share repurchase programs, the Company considers the
effect of repurchases on its tangible book value per share. At the
Company’s current share price level, the amount of dilution to
tangible book value may limit the Company’s repurchasing of shares.
The Company will closely monitor this issue and, depending on
market and other conditions, will conduct repurchases when it makes
financial sense.
Asset Quality
Total delinquent loans 90 days or more past due and not accruing
totaled $1.84 million (7 loans) at June 30, 2016, compared to $1.63
million (7 loans) at December 31, 2015. Non-performing assets
totaled $5.06 million at June 30, 2016 compared to $5.42 million at
December 31, 2015. The ratio of non-performing assets to
total assets declined to 0.27% at June 30, 2016 from 0.30% at
December 31, 2015 and continues to remain one of the lowest in the
country. The allowance for loan losses at June 30, 2016 was
$2.28 million and represented 0.18% of total loans compared to
$2.17 million and 0.18% of total loans as of December 31,
2015.
About Us
Territorial Bancorp Inc., headquartered in Honolulu, Hawaii, is
the stock holding company for Territorial Savings Bank.
Territorial Savings Bank is a state chartered savings bank which
was originally chartered in 1921 by the Territory of Hawaii.
Territorial Savings Bank conducts business from its headquarters in
Honolulu, Hawaii and has 28 branch offices in the state of
Hawaii. For additional information, please visit the
Company’s website at:
https://www.territorialsavings.net.
Forward-looking statements - this earnings
release contains forward-looking statements, which can be
identified by the use of words such as “estimate,” “project,”
“believe,” “intend,” “anticipate,” “plan,” “seek,” “expect,”
“will,” “may” and words of similar meaning. These forward-looking
statements include, but are not limited to:
- statements of our goals, intentions and expectations;
- statements regarding our business plans, prospects, growth and
operating strategies;
- statements regarding the asset quality of our loan and
investment portfolios; and
- estimates of our risks and future costs and benefits.
These forward-looking statements are based on our current
beliefs and expectations and are inherently subject to significant
business, economic and competitive uncertainties and contingencies,
many of which are beyond our control. In addition, these
forward-looking statements are subject to assumptions with respect
to future business strategies and decisions that are subject to
change. We are under no duty to and do not take any obligation to
update any forward-looking statements after the date of this
earnings release.
The following factors, among others, including those set forth
in the Company’s filings with the Securities and Exchange
Commission, could cause actual results to differ materially from
the anticipated results or other expectations expressed in the
forward-looking statements:
- general economic conditions, either nationally, internationally
or in our market areas, that are worse than expected;
- competition among depository and other financial
institutions;
- inflation and changes in the interest rate environment that
reduce our margins or reduce the fair value of financial
instruments;
- adverse changes in the securities markets;
- changes in laws or government regulations or policies affecting
financial institutions, including changes in regulatory fees and
capital requirements;
- our ability to enter new markets successfully and capitalize on
growth opportunities;
- our ability to successfully integrate acquired entities, if
any;
- changes in consumer spending, borrowing and savings
habits;
- changes in market and other conditions that would affect our
ability to repurchase our shares of common stock;
- changes in accounting policies and practices, as may be adopted
by the bank regulatory agencies, the Financial Accounting Standards
Board, the Securities and Exchange Commission and the Public
Company Accounting Oversight Board;
- changes in our organization, compensation and benefit
plans;
- changes in our financial condition or results of operations
that reduce capital available to pay dividends; and
- changes in the financial condition or future prospects of
issuers of securities that we own.
Because of these and a wide variety of other uncertainties, our
actual future results may be materially different from the results
indicated by these forward-looking statements.
Territorial Bancorp Inc. and
Subsidiaries |
|
Consolidated Statements of Income (Unaudited) |
|
(Dollars in thousands, except per share data) |
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Six Months
Ended |
|
|
|
|
June 30, |
|
June 30, |
|
|
|
|
2016 |
|
2015 |
|
2016 |
|
2015 |
|
|
Interest
and dividend income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans |
|
$ |
12,647 |
|
$ |
11,266 |
|
$ |
25,008 |
|
$ |
21,952 |
|
|
Investment securities |
|
|
3,750 |
|
|
4,274 |
|
|
7,625 |
|
|
8,797 |
|
|
Other investments |
|
|
146 |
|
|
70 |
|
|
290 |
|
|
149 |
|
|
Total interest and dividend
income |
|
|
16,543 |
|
|
15,610 |
|
|
32,923 |
|
|
30,898 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
1,470 |
|
|
1,154 |
|
|
2,878 |
|
|
2,288 |
|
|
Advances from the Federal Home Loan
Bank |
|
|
256 |
|
|
157 |
|
|
513 |
|
|
227 |
|
|
Securities sold under agreements to
repurchase |
|
|
218 |
|
|
243 |
|
|
436 |
|
|
555 |
|
|
Total interest expense |
|
|
1,944 |
|
|
1,554 |
|
|
3,827 |
|
|
3,070 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income |
|
|
14,599 |
|
|
14,056 |
|
|
29,096 |
|
|
27,828 |
|
|
Provision for loan losses |
|
|
84 |
|
|
101 |
|
|
112 |
|
|
295 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income after provision
for loan losses |
|
|
14,515 |
|
|
13,955 |
|
|
28,984 |
|
|
27,533 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service fees on loan and deposit
accounts |
|
|
473 |
|
|
527 |
|
|
929 |
|
|
987 |
|
|
Income on bank-owned life
insurance |
|
|
240 |
|
|
256 |
|
|
487 |
|
|
511 |
|
|
Gain on sale of investment
securities |
|
|
190 |
|
|
240 |
|
|
190 |
|
|
476 |
|
|
Gain on sale of loans |
|
|
129 |
|
|
110 |
|
|
190 |
|
|
239 |
|
|
Other |
|
|
102 |
|
|
115 |
|
|
224 |
|
|
281 |
|
|
Total noninterest income |
|
|
1,134 |
|
|
1,248 |
|
|
2,020 |
|
|
2,494 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee benefits |
|
|
5,256 |
|
|
5,064 |
|
|
10,682 |
|
|
10,163 |
|
|
Occupancy |
|
|
1,433 |
|
|
1,428 |
|
|
2,853 |
|
|
2,865 |
|
|
Equipment |
|
|
912 |
|
|
953 |
|
|
1,818 |
|
|
1,898 |
|
|
Federal deposit insurance
premiums |
|
|
227 |
|
|
211 |
|
|
452 |
|
|
420 |
|
|
Other general and administrative
expenses |
|
|
1,160 |
|
|
1,187 |
|
|
2,242 |
|
|
2,401 |
|
|
Total noninterest expense |
|
|
8,988 |
|
|
8,843 |
|
|
18,047 |
|
|
17,747 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
before income taxes |
|
|
6,661 |
|
|
6,360 |
|
|
12,957 |
|
|
12,280 |
|
|
Income
taxes |
|
|
2,624 |
|
|
2,523 |
|
|
5,136 |
|
|
4,917 |
|
|
Net income |
|
$ |
4,037 |
|
$ |
3,837 |
|
$ |
7,821 |
|
$ |
7,363 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
earnings per share |
|
$ |
0.45 |
|
$ |
0.42 |
|
$ |
0.86 |
|
$ |
0.81 |
|
|
Diluted
earnings per share |
|
$ |
0.43 |
|
$ |
0.41 |
|
$ |
0.84 |
|
$ |
0.79 |
|
|
Cash
dividends declared per common share |
|
$ |
0.18 |
|
$ |
0.16 |
|
$ |
0.36 |
|
$ |
0.32 |
|
|
Basic
weighted-average shares outstanding |
|
|
9,059,515 |
|
|
9,053,383 |
|
|
9,047,217 |
|
|
9,086,865 |
|
|
Diluted
weighted-average shares outstanding |
|
|
9,345,262 |
|
|
9,307,988 |
|
|
9,323,432 |
|
|
9,314,776 |
|
|
Territorial Bancorp Inc. and
Subsidiaries |
|
|
Consolidated Balance Sheets (Unaudited) |
|
(Dollars in thousands, except per share data) |
|
|
|
|
|
|
|
|
|
June 30, |
|
December
31, |
|
|
|
|
|
2016 |
|
2015 |
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
|
63,878 |
|
|
$ |
|
65,919 |
|
|
|
|
Investment securities held to maturity, at amortized cost (fair
value of $474,058 and $497,982 at June 30, 2016 and December 31,
2015, respectively) |
|
|
|
455,991 |
|
|
|
|
493,059 |
|
|
|
|
Loans
held for sale |
|
|
|
353 |
|
|
|
|
2,139 |
|
|
|
|
Loans
receivable, net |
|
|
|
1,259,339 |
|
|
|
|
1,188,649 |
|
|
|
|
Federal
Home Loan Bank stock, at cost |
|
|
|
4,945 |
|
|
|
|
4,790 |
|
|
|
|
Federal
Reserve Bank stock, at cost |
|
|
|
3,062 |
|
|
|
|
3,022 |
|
|
|
|
Accrued
interest receivable |
|
|
|
4,812 |
|
|
|
|
4,684 |
|
|
|
|
Premises
and equipment, net |
|
|
|
4,399 |
|
|
|
|
4,903 |
|
|
|
|
Bank-owned life insurance |
|
|
|
42,815 |
|
|
|
|
42,328 |
|
|
|
|
Current
income taxes receivable |
|
|
— |
|
|
— |
|
|
|
Deferred
income tax assets, net |
|
|
|
8,974 |
|
|
|
|
9,378 |
|
|
|
|
Prepaid
expenses and other assets |
|
|
|
2,404 |
|
|
|
|
2,270 |
|
|
|
|
Total assets |
|
$ |
|
1,850,972 |
|
|
$ |
|
1,821,141 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
Liabilities: |
|
|
|
|
|
|
|
|
|
Deposits |
|
$ |
|
1,469,754 |
|
|
$ |
|
1,445,103 |
|
|
|
|
Advances from the Federal Home Loan
Bank |
|
|
|
69,000 |
|
|
|
|
69,000 |
|
|
|
|
Securities sold under agreements to
repurchase |
|
|
|
55,000 |
|
|
|
|
55,000 |
|
|
|
|
Accounts payable and accrued
expenses |
|
|
|
24,227 |
|
|
|
|
25,178 |
|
|
|
|
Current income taxes payable |
|
|
|
1,960 |
|
|
|
|
2,095 |
|
|
|
|
Advance payments by borrowers for
taxes and insurance |
|
|
|
5,315 |
|
|
|
|
5,124 |
|
|
|
|
Total liabilities |
|
|
|
1,625,256 |
|
|
|
|
1,601,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ Equity: |
|
|
|
|
|
|
|
|
|
Preferred stock, $.01 par value;
authorized 50,000,000 shares, no shares issued or outstanding |
|
|
— |
|
|
— |
|
|
|
Common stock, $.01 par value;
authorized 100,000,000 shares; issued and outstanding 9,663,122 and
9,659,685 shares at June 30, 2016 and December 31, 2015,
respectively |
|
|
|
96 |
|
|
|
|
96 |
|
|
|
|
Additional paid-in capital |
|
|
|
71,389 |
|
|
|
|
70,118 |
|
|
|
|
Unearned ESOP shares |
|
|
|
(6,117 |
) |
|
|
|
(6,361 |
) |
|
|
|
Retained earnings |
|
|
|
165,553 |
|
|
|
|
161,024 |
|
|
|
|
Accumulated other comprehensive
loss |
|
|
|
(5,205 |
) |
|
|
|
(5,236 |
) |
|
|
|
Total stockholders’ equity |
|
|
|
225,716 |
|
|
|
|
219,641 |
|
|
|
|
Total liabilities and stockholders’
equity |
|
$ |
|
1,850,972 |
|
|
$ |
|
1,821,141 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TERRITORIAL BANCORP INC. AND SUBSIDIARIES |
|
|
|
|
|
|
|
|
|
|
|
|
Selected Financial Data (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
|
|
|
|
|
|
|
|
|
2016 |
|
|
|
2015 |
|
|
|
|
|
Performance
Ratios (annualized): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on
average assets |
|
|
|
|
|
0.88 |
% |
|
|
0.89 |
% |
|
|
|
|
Return on
average equity |
|
|
|
|
|
7.18 |
% |
|
|
7.04 |
% |
|
|
|
|
Net
interest margin on average interest earning assets |
|
|
3.27 |
% |
|
|
3.37 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At June |
|
At December |
|
|
|
|
|
|
|
|
|
|
|
30, 2016 |
|
|
|
31, 2015 |
|
|
|
|
|
Selected
Balance Sheet Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Book value
per share (1) |
|
|
|
|
$ |
23.36 |
|
|
$ |
22.74 |
|
|
|
|
|
Stockholders' equity to total assets |
|
|
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|
12.19 |
% |
|
|
12.06 |
% |
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Asset Quality |
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|
(Dollars in
thousands): |
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Delinquent
loans 90 days or more past due and not accruing (2) |
|
$ |
1,835 |
|
|
$ |
1,625 |
|
|
|
|
|
Non-performing assets (2) |
|
|
|
|
|
5,058 |
|
|
|
5,415 |
|
|
|
|
|
Allowance
for loan losses |
|
|
|
|
|
2,276 |
|
|
|
2,166 |
|
|
|
|
|
Non-performing assets to total assets |
|
|
|
|
0.27 |
% |
|
|
0.30 |
% |
|
|
|
|
Allowance
for loan losses to total loans |
|
|
|
|
0.18 |
% |
|
|
0.18 |
% |
|
|
|
|
Allowance
for loan losses to non-performing assets |
|
|
|
45.00 |
% |
|
|
40.00 |
% |
|
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Note: |
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(1) Book
value per share is equal to stockholders' equity divided by number
of shares issued and |
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outstanding |
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(2)
Non-performing loans consists of non-accrual loans and real estate
owned. Amounts are net of charge-offs. |
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Contact: Walter Ida
(808) 946-1400
Territorial Bancorp (NASDAQ:TBNK)
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From Mar 2024 to Apr 2024
Territorial Bancorp (NASDAQ:TBNK)
Historical Stock Chart
From Apr 2023 to Apr 2024