MSB Financial Corp. (NASDAQ: MSBF) (the
“Company”), parent company of Millington Bank, reported today the
results of its operations for the three and six months ended
June 30, 2018.
The Company reported net income of $1.2 million,
or $0.23 per diluted common share, for the three months ended
June 30, 2018, compared to net income of $732,000, or $0.13
per diluted common share, for the three months ended June 30,
2017. Net income for the six months ended June 30, 2018 was
$2.3 million, or $0.42 per diluted common share, compared to net
income of $1.3 million, or $0.23 per diluted common share, for the
six months ended June 30, 2017.
Highlights for the quarter:
- Return on average assets was 0.87% for the three months ended
June 30, 2018 compared to 0.59% for the three months ended
June 30, 2017 and return on average equity was 7.17% for the
three months ended June 30, 2018 compared to 3.91% for the
three months ended June 30, 2017.
- Net interest margin decreased 11 basis points to 3.24% for the
quarter ended June 30, 2018 from 3.35% for the quarter ended
June 30, 2017 due to a change in deposit pricing as
competition for deposits has increased.
- The efficiency ratio, which is calculated by dividing
non-interest expense by the sum of net interest income and
non-interest income, improved to 62.49% for the quarter ended
June 30, 2018 from 68.02% for the quarter ended June 30,
2017 driven by an increase in net interest income year over
year.
- Non-performing assets represented 0.69% of total assets at
June 30, 2018 compared with 0.73% at December 31, 2017.
The allowance for loan losses as a percentage of total
non-performing loans was 135.53% at June 30, 2018 compared to
130.99% at December 31, 2017.
- The Company’s balance sheet reflected total asset growth of
$38.2 million at June 30, 2018, compared to December 31,
2017, improving asset quality, and capital levels that exceeded
regulatory standards for a well-capitalized
institution.
- The effective tax rate improved to 24.7% for the quarter ended
June 30, 2018 compared to 28.6% for the quarter ended
June 30, 2017 primarily due to the passage of the Tax Cuts and
Jobs Act.
|
Selected Financial Ratios |
|
|
|
|
|
|
|
|
|
|
| (unaudited; annualized where
applicable) |
| |
|
|
|
|
|
|
|
|
|
|
| As of or for the quarter ended: |
|
6/30/2018 |
|
3/31/2018 |
|
12/31/2017 |
|
9/30/2017 |
|
6/30/2017 |
| Return on
average assets |
|
0.87 |
% |
|
0.74 |
% |
|
0.20 |
% |
|
0.90 |
% |
|
0.59 |
% |
| Return on
average equity |
|
7.17 |
% |
|
5.65 |
% |
|
1.48 |
% |
|
6.31 |
% |
|
3.91 |
% |
| Net
interest margin |
|
3.24 |
% |
|
3.24 |
% |
|
3.30 |
% |
|
3.37 |
% |
|
3.35 |
% |
| Net loans /
deposit ratio |
|
113.64 |
% |
|
110.85 |
% |
|
105.46 |
% |
|
116.04 |
% |
|
109.31 |
% |
|
Shareholders' equity / total assets |
|
11.39 |
% |
|
12.37 |
% |
|
12.97 |
% |
|
13.39 |
% |
|
14.79 |
% |
| Efficiency
ratio |
|
62.49 |
% |
|
66.29 |
% |
|
62.26 |
% |
|
64.21 |
% |
|
68.02 |
% |
| Book value
per common share |
|
$ |
12.43 |
|
|
$ |
12.63 |
|
|
$ |
12.66 |
|
|
$ |
12.57 |
|
|
$ |
13.07 |
|
| |
Net Interest Income
Total interest income for the three months ended
June 30, 2018 increased $1.0 million, or 21.4%, to $5.7
million compared to $4.7 million for the second quarter of 2017.
Interest income increased in the quarter ended June 30, 2018
compared to the comparable period in 2017, primarily due to a $83.9
million increase in average loan balances. Total interest expense
increased by $504,000, or 62.8%, to $1.3 million, for the three
months ended June 30, 2018 compared to the same period in 2017
due to a mix of higher deposit rates and average deposit
balances.
Net interest income for the three months ended
June 30, 2018 increased $507,000, or 12.9%, to $4.4 million
compared to $3.9 million for the same three-month period in 2017.
The change for the three months ended June 30, 2018 was
primarily a result of an increase in average earning assets of
$78.8 million. The annualized net interest spread was 3.05% and
3.18% for the three months ended June 30, 2018 and 2017,
respectively. For the quarter ended June 30, 2018, the
Company's annualized net interest margin decreased to 3.24%
compared to 3.35% for the corresponding three-month period in
2017.
Total interest income for the six months ended
June 30, 2018, increased $2.1 million, or 23.8%, to $11.2
million compared to $9.0 million for the six months ended
June 30, 2017 as average earning assets increased $86.6
million year over year. Total interest expense increased by
$933,000, or 62.2%, to $2.4 million for the six months ended
June 30, 2018 compared to June 30, 2017 as average
interest-bearing liabilities increased $67.3 million year over year
and the average cost of such liabilities increased 24 basis
points.
Net interest income grew $1.2 million, or 16.1%,
to $8.7 million for the six months ended June 30, 2018
compared to $7.5 million for the six months ended June 30,
2017. Net interest spread and net interest margin for the six
months ended June 30, 2018, declined 8 basis points
respectively, to 3.06% and 3.24% compared to 3.14% and 3.32% for
the six months ended June 30, 2017. Net interest income and
net interest margin decreased as the Company's deposit pricing has
become more competitive year over year.
Non-Interest Income and Non-Interest
Expense
Non-interest income for the three months ended
June 30, 2018 was $208,000, as compared to $219,000 for the
same period in 2017. Non-interest expense, which consists of
salaries and employee benefits, occupancy expense, professional
services and other non-interest expenses totaled $2.9 million for
the quarter ended June 30, 2018 as compared to $2.8 million
for the same period in 2017.
Non-interest income for the six months ended
June 30, 2018 was $412,000, as compared to $406,000 for the
same period in 2017. Non-interest expense, totaled $5.9
million for the six months ended June 30, 2018 as compared to
$5.5 million for the same period in 2017 with the $351,000 increase
primarily attributable to salaries and employee benefits as a
result of merit and infrastructure increases.
Taxes
For the three months ended June 30, 2018,
the Company recorded a $407,000 tax provision compared to a
provision of $293,000 for the three months ended June 30,
2017. The effective tax rate improved to 24.7% for the quarter
ended June 30, 2018 compared to 28.6% for the quarter ended
June 30, 2017. As a result of the passage of the Tax Cuts and
Jobs Act on December 22, 2017, the federal tax rate for
corporations was reduced to 21% during 2018. The increase in tax
provision is attributable to an increase in pre-tax income offset
by a decrease in the applicable tax rate.
For the six months ended June 30, 2018, the
Company recorded a $814,000 tax provision compared to a provision
of $614,000 for the six months ended June 30, 2017. The
effective tax rate improved to 26.4% for the six months ended
June 30, 2018 compared to 32.4% for the six months ended
June 30, 2017. The increase in tax provision is attributable
to an increase in pre-tax income offset by a decrease in the
applicable tax rate.
Earnings Summary for Period Ended
June 30, 2018
The following table presents condensed
consolidated statements of income data for the periods
indicated.
| Condensed Consolidated Statements of Income
(unaudited) |
| |
|
|
|
|
|
|
|
|
|
|
| (dollars in thousands, except for per share
data) |
| For the quarter ended: |
|
6/30/2018 |
|
3/31/2018 |
|
12/31/2017 |
|
9/30/2017 |
|
6/30/2017 |
| Net
interest income |
|
$ |
4,431 |
|
|
$ |
4,302 |
|
|
$ |
4,325 |
|
|
$ |
4,190 |
|
|
$ |
3,924 |
|
| Provision
for loan losses |
|
90 |
|
|
90 |
|
|
200 |
|
|
490 |
|
|
300 |
|
| Net
interest income after provision for loan losses |
|
4,341 |
|
|
4,212 |
|
|
4,125 |
|
|
3,700 |
|
|
3,624 |
|
| Other
income |
|
208 |
|
|
204 |
|
|
211 |
|
|
205 |
|
|
219 |
|
| Other
expense |
|
2,899 |
|
|
2,987 |
|
|
2,824 |
|
|
2,822 |
|
|
2,818 |
|
| Income
before income taxes |
|
1,650 |
|
|
1,429 |
|
|
1,512 |
|
|
1,083 |
|
|
1,025 |
|
| Income
taxes (benefit) |
|
407 |
|
|
407 |
|
|
1,240 |
|
|
(86 |
) |
|
293 |
|
| Net
income |
|
$ |
1,243 |
|
|
$ |
1,022 |
|
|
$ |
272 |
|
|
$ |
1,169 |
|
|
$ |
732 |
|
| Earnings
per common share: |
|
|
|
|
|
|
|
|
|
|
| Basic |
|
$ |
0.23 |
|
|
$ |
0.19 |
|
|
$ |
0.05 |
|
|
$ |
0.21 |
|
|
$ |
0.13 |
|
| Diluted |
|
$ |
0.23 |
|
|
$ |
0.19 |
|
|
$ |
0.05 |
|
|
$ |
0.21 |
|
|
$ |
0.13 |
|
| Weighted
average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
| Basic |
|
5,331,090 |
|
|
5,470,349 |
|
|
5,577,314 |
|
|
5,563,938 |
|
|
5,539,796 |
|
| Diluted |
|
5,375,090 |
|
|
5,507,443 |
|
|
5,588,598 |
|
|
5,574,535 |
|
|
5,679,012 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Statement of Condition Highlights at June 30,
2018
- Balance sheet growth, with total assets amounting to $601.2
million at June 30, 2018, an increase of $38.2 million, or
6.79%, compared to December 31, 2017.
- The Company’s total gross loans receivable were $515.3 million
at June 30, 2018, an increase of $36.5 million, or 7.6%, from
December 31, 2017.
- Securities held to maturity were $44.8 million at June 30,
2018, an increase of $6.3 million, or 16.3%, compared to
December 31, 2017.
- Deposits were relatively flat totaling $448.5 million at
June 30, 2018 compared to $448.9 million at December 31,
2017.
- Borrowings totaled $82.2 million at June 30, 2018, an
increase of $44.5 million, or 118.1%, compared to $37.7 million at
December 31, 2017.
The following table presents condensed
consolidated statements of condition data as of the dates
indicated.
| Condensed Consolidated Statements of Condition
(unaudited) |
| |
|
|
|
|
|
|
|
|
|
|
| (in
thousands) |
|
|
|
|
|
|
|
|
|
|
| At: |
|
6/30/2018 |
|
3/31/2018 |
|
12/31/2017 |
|
9/30/2017 |
|
6/30/2017 |
| Cash and
due from banks |
|
$ |
1,654 |
|
$ |
1,871 |
|
$ |
2,030 |
|
$ |
1,800 |
|
$ |
1,839 |
|
Interest-earning demand deposits with banks |
|
14,660 |
|
15,484 |
|
20,279 |
|
6,971 |
|
7,195 |
| Securities
held to maturity |
|
44,770 |
|
36,375 |
|
38,482 |
|
40,752 |
|
42,441 |
| Loans
receivable, net of allowance |
|
509,689 |
|
480,916 |
|
473,405 |
|
461,285 |
|
426,370 |
| Premises
and equipment |
|
8,461 |
|
8,580 |
|
8,698 |
|
8,804 |
|
8,902 |
| Federal
home Loan Bank of New York stock, at cost |
|
4,212 |
|
3,049 |
|
2,131 |
|
3,512 |
|
2,263 |
| Bank owned
life insurance |
|
14,392 |
|
14,294 |
|
14,197 |
|
14,097 |
|
13,996 |
| Accrued
interest receivable |
|
1,754 |
|
1,642 |
|
1,607 |
|
1,548 |
|
1,402 |
| Other
assets |
|
1,657 |
|
1,816 |
|
2,211 |
|
2,988 |
|
2,690 |
| Total assets |
|
$ |
601,249 |
|
$ |
564,027 |
|
$ |
563,040 |
|
$ |
541,757 |
|
$ |
507,098 |
|
Deposits |
|
$ |
448,512 |
|
$ |
433,843 |
|
$ |
448,913 |
|
$ |
397,510 |
|
$ |
390,063 |
|
Borrowings |
|
82,175 |
|
58,075 |
|
37,675 |
|
68,375 |
|
38,675 |
| Other
liabilities |
|
2,056 |
|
2,350 |
|
3,427 |
|
3,332 |
|
3,371 |
|
Shareholders' equity |
|
68,506 |
|
69,759 |
|
73,025 |
|
72,540 |
|
74,989 |
| Total liabilities and shareholders' equity |
|
$ |
601,249 |
|
$ |
564,027 |
|
$ |
563,040 |
|
$ |
541,757 |
|
$ |
507,098 |
| |
Loans
At June 30, 2018, the Company’s net loan
portfolio totaled $509.7 million, an increase of $36.3 million, or
7.7%, compared to $473.4 million at December 31, 2017.
The allowance for loan losses amounted to $5.6 million and $5.4
million at June 30, 2018 and December 31, 2017,
respectively.
At June 30, 2018, the loan portfolio
primarily consisted of commercial real estate loans (40.1%) and
residential mortgages (33.2%). Commercial and industrial loans
represented 17.6% of the portfolio while construction loans
accounted for 9.0% of the portfolio. Total loans receivable
increased $36.2 million to $535.4 million at June 30, 2018
compared to $499.2 million at December 31, 2017. The increase
primarily reflects a $20.7 million increase in commercial and
industrial loans and an 18.0 million increase in commercial real
estate loans. The increases were partially offset by a $7.1 million
decrease in residential mortgages as the Company continues to focus
on commercial lending.
The following table shows the composition of the
Company's loan portfolio as of the dates indicated.
|
Loans (unaudited) |
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
| (dollars in thousands) |
| At quarter ended: |
|
6/30/2018 |
|
3/31/2018 |
|
12/31/2017 |
|
9/30/2017 |
|
6/30/2017 |
| Residential
mortgage: |
|
|
|
|
|
|
|
|
|
|
| One-to-four family |
|
$ |
151,372 |
|
$ |
154,576 |
|
$ |
157,876 |
|
$ |
161,679 |
|
$ |
164,448 |
| Home equity |
|
26,174 |
|
27,051 |
|
26,803 |
|
27,409 |
|
29,021 |
| Total
residential mortgage |
|
177,546 |
|
181,627 |
|
184,679 |
|
189,088 |
|
193,469 |
| Commercial
and multi-family real estate |
|
214,653 |
|
195,951 |
|
196,681 |
|
184,791 |
|
153,984 |
|
Construction |
|
48,423 |
|
49,397 |
|
43,718 |
|
36,002 |
|
29,623 |
| Commercial
and industrial |
|
94,140 |
|
82,712 |
|
73,465 |
|
73,409 |
|
67,686 |
| Total
commercial loans |
|
357,216 |
|
328,060 |
|
313,864 |
|
294,202 |
|
251,293 |
| Consumer
loans |
|
608 |
|
595 |
|
618 |
|
659 |
|
434 |
| Total loans
receivable |
|
535,370 |
|
510,282 |
|
499,161 |
|
483,949 |
|
445,196 |
| Less: |
|
|
|
|
|
|
|
|
|
|
| Loans in process |
|
19,594 |
|
23,398 |
|
19,868 |
|
16,864 |
|
13,315 |
| Deferred loan fees |
|
491 |
|
462 |
|
474 |
|
525 |
|
586 |
| Allowance |
|
5,596 |
|
5,506 |
|
5,414 |
|
5,275 |
|
4,925 |
| Total loans
receivable, net |
|
$ |
509,689 |
|
$ |
480,916 |
|
$ |
473,405 |
|
$ |
461,285 |
|
$ |
426,370 |
| |
Asset Quality
At June 30, 2018, non-performing loans
totaled $4.1 million, or 0.69% of total assets, compared with $4.1
million, or 0.73% of total assets, at December 31, 2017. Total
delinquent loans (including nonperforming delinquent loans) were
$7.0 million at June 30, 2018, an increase of $1.6 million
from December 31, 2017 due to an increase in loans past due
30-59 days. The allowance for loan losses as a percentage of
total loans was 1.09% at June 30, 2018 and 1.13% at
December 31, 2017, respectively, while the allowance for loan
losses as a percentage of non-performing loans increased to 135.53%
at June 30, 2018 from 130.99% at December 31, 2017.
Non-performing loans to total loans decreased to 0.80% at
June 30, 2018 from 0.86% at December 31, 2017.
The following table presents the components of
non-performing assets and other asset quality data for the periods
indicated.
| |
|
|
|
|
|
|
|
|
|
|
| (dollars in thousands, unaudited) |
| As of or for the quarter ended: |
|
6/30/2018 |
|
3/31/2018 |
|
12/31/2017 |
|
9/30/2017 |
|
6/30/2017 |
| Non-accrual
loans |
|
$ |
3,430 |
|
|
$ |
3,548 |
|
|
$ |
3,975 |
|
|
$ |
4,071 |
|
|
$ |
6,916 |
|
| Loans 90
days or more past due and still accruing |
|
699 |
|
|
1,266 |
|
|
158 |
|
|
374 |
|
|
— |
|
| Total non-performing loans |
|
$ |
4,129 |
|
|
$ |
4,814 |
|
|
$ |
4,133 |
|
|
$ |
4,445 |
|
|
$ |
6,916 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
Non-performing assets / total assets |
|
0.69 |
% |
|
0.85 |
% |
|
0.73 |
% |
|
0.82 |
% |
|
1.36 |
% |
|
Non-performing loans / total loans |
|
0.80 |
% |
|
0.99 |
% |
|
0.86 |
% |
|
0.95 |
% |
|
1.60 |
% |
| Net
charge-offs (recoveries) |
|
$ |
— |
|
|
$ |
(2 |
) |
|
$ |
61 |
|
|
$ |
140 |
|
|
$ |
1 |
|
| Net
charge-offs (recoveries) / average loans (annualized) |
|
— |
% |
|
— |
% |
|
0.05 |
% |
|
0.13 |
% |
|
— |
% |
| Allowance
for loan loss / total loans |
|
1.09 |
% |
|
1.13 |
% |
|
1.13 |
% |
|
1.13 |
% |
|
1.14 |
% |
| Allowance
for loan losses / non-performing loans |
|
135.53 |
% |
|
114.37 |
% |
|
130.99 |
% |
|
118.69 |
% |
|
71.21 |
% |
| |
|
|
|
|
|
|
|
|
|
|
| Total
assets |
|
$ |
601,249 |
|
|
$ |
564,027 |
|
|
$ |
563,040 |
|
|
$ |
541,757 |
|
|
$ |
507,098 |
|
| Gross
loans, including ALLL |
|
$ |
515,285 |
|
|
$ |
486,422 |
|
|
$ |
478,819 |
|
|
$ |
466,560 |
|
|
$ |
431,295 |
|
| Average
loans |
|
$ |
500,959 |
|
|
$ |
483,255 |
|
|
$ |
472,388 |
|
|
$ |
446,383 |
|
|
$ |
417,065 |
|
| Allowance
for loan losses |
|
$ |
5,596 |
|
|
$ |
5,506 |
|
|
$ |
5,414 |
|
|
$ |
5,275 |
|
|
$ |
4,925 |
|
| |
Deposits
Total deposits at June 30, 2018 were $448.5
million compared with $448.9 million at December 31,
2017. Overall, deposits were relatively flat. Non-interest
demand balances and savings balances increased $5.8 million and
$4.1 million, respectively. Non-interest demand balances increased
to $42.7 million from $36.9 million from year end while savings
balances increased to $109.3 million from $105.1 million from year
end. In addition, certificates of deposit (including IRA) balances
increased $3.9 million to $128.2 million compared to $124.3 million
from year end. Offsetting the increases were declines in money
market and interest demand balances of $13.0 million and $1.2
million, respectively. Money market balances declined to $14.4
million compared to $27.4 million while interest demand balances
declined to $154.0 million compared to $155.2 million from year
end.
The following table shows the composition of the
Company's deposits as of the dates indicated.
| Deposits (unaudited) |
| |
|
|
|
|
|
|
|
|
|
|
| (dollars in thousands) |
| At quarter ended: |
|
6/30/2018 |
|
3/31/2018 |
|
12/31/2017 |
|
9/30/2017 |
|
6/30/2017 |
|
Demand: |
|
|
|
|
|
|
|
|
|
|
| Non-interest bearing |
|
$ |
42,687 |
|
$ |
36,751 |
|
$ |
36,919 |
|
$ |
40,504 |
|
$ |
44,584 |
| Interest-bearing |
|
153,968 |
|
148,888 |
|
155,199 |
|
107,419 |
|
95,196 |
|
Savings |
|
109,254 |
|
109,215 |
|
105,106 |
|
108,249 |
|
105,560 |
| Money
market |
|
14,381 |
|
20,251 |
|
27,350 |
|
16,517 |
|
15,842 |
| Time |
|
128,222 |
|
118,738 |
|
124,339 |
|
124,821 |
|
128,881 |
| Total deposits |
|
$ |
448,512 |
|
$ |
433,843 |
|
$ |
448,913 |
|
$ |
397,510 |
|
$ |
390,063 |
| |
Capital
At June 30, 2018, the Company's total
stockholders' equity amounted to $68.5 million, or 11.39% of total
assets, compared to $73.0 million at December 31, 2017. The
Company’s book value per common share was $12.43 at June 30,
2018, compared to $12.66 at December 31, 2017. The decline in
shareholders' equity was primarily due to the repurchase of 249,837
shares of common stock for a total of $4.5 million and the payment
of a special dividend in the aggregate amount of $2.5 million,
partially offset by net income of $2.3 million.
At June 30, 2018, the Bank’s common equity
tier 1 ratio was 11.30%, tier 1 leverage ratio was 10.33%, tier 1
capital ratio was 11.30% and the total capital ratio was 12.39%. At
December 31, 2017, the Bank’s common equity tier 1 ratio was
11.98%, tier 1 leverage ratio was 10.72%, tier 1 capital ratio was
11.98% and the total capital ratio was 13.10%. At June 30,
2018, the Bank was in compliance with all applicable regulatory
capital requirements.
The following table sets forth the Company's
consolidated average statements of condition for the periods
presented.
| Condensed Consolidated Average Statements of
Condition (unaudited) |
| |
|
|
|
|
|
|
|
|
|
|
| (dollars in thousands) |
| For the quarter ended: |
|
6/30/2018 |
|
3/31/2018 |
|
12/31/2017 |
|
9/30/2017 |
|
6/30/2017 |
| Loans |
|
$ |
500,959 |
|
|
$ |
483,255 |
|
|
$ |
472,388 |
|
|
$ |
446,383 |
|
|
$ |
417,065 |
|
| Securities
held to maturity |
|
36,494 |
|
|
37,661 |
|
|
39,899 |
|
|
41,423 |
|
|
41,885 |
|
| Allowance
for loan losses |
|
(5,538 |
) |
|
(5,461 |
) |
|
(5,376 |
) |
|
(4,922 |
) |
|
(4,695 |
) |
| All other
assets |
|
38,053 |
|
|
38,851 |
|
|
41,886 |
|
|
38,545 |
|
|
38,603 |
|
| Total assets |
|
$ |
569,968 |
|
|
$ |
554,306 |
|
|
$ |
548,797 |
|
|
$ |
521,429 |
|
|
$ |
492,858 |
|
|
Non-interest bearing deposits |
|
$ |
38,903 |
|
|
$ |
36,211 |
|
|
$ |
43,336 |
|
|
$ |
44,970 |
|
|
$ |
43,030 |
|
|
Interest-bearing deposits |
|
385,047 |
|
|
390,522 |
|
|
375,098 |
|
|
350,589 |
|
|
333,902 |
|
|
Borrowings |
|
74,192 |
|
|
53,191 |
|
|
53,844 |
|
|
47,788 |
|
|
37,715 |
|
| Other
liabilities |
|
2,495 |
|
|
1,972 |
|
|
3,104 |
|
|
3,964 |
|
|
3,363 |
|
|
Stockholders' Equity |
|
69,331 |
|
|
72,410 |
|
|
73,415 |
|
|
74,118 |
|
|
74,848 |
|
| Total liabilities and shareholders' equity |
|
$ |
569,968 |
|
|
$ |
554,306 |
|
|
$ |
548,797 |
|
|
$ |
521,429 |
|
|
$ |
492,858 |
|
| |
|
|
|
|
|
|
|
|
|
|
CEO outlook:
"During the quarter the Company furthered its
goals to create shareholder value and to reward stockholders by
distributing a second special dividend of $0.445 per share," stated
Michael Shriner, President and Chief Executive Officer. Mr.
Shriner added, "Our staff remains committed to improving earnings,
and ultimately our return to shareholders, by focusing out efforts
on growing the balance sheet, building new relationships, becoming
more efficient and reducing the number of non-performing
assets."
Mr. Shriner further commented, "I am very
pleased with our growth in the second quarter, however the trend of
higher short term interest rates we are experiencing will
ultimately dictate where growth ends up by the fourth
quarter. Strong competition for deposits is beginning to show
up in out cost of funds, which may affect the level of growth the
Company achieves in the latter half of 2018."
Forward Looking Statement
Disclaimer
The foregoing release may contain
forward-looking statements concerning the financial condition,
results of operations and business of the Company. We caution that
such statements are subject to a number of uncertainties and actual
results could differ materially, and, therefore, readers should not
place undue reliance on any forward-looking statements. Factors
that may cause actual results to differ from those contemplated
include our continued ability to grow the loan portfolio, the
impact of the passage of the Tax Cuts and Jobs Act and our
continued ability to manage cybersecurity risks.
|
Contact: |
Michael A.
Shriner, President & CEO |
| |
(908)
647-4000 |
| |
mshriner@millingtonbank.com |
| |
|
|
| MSB Financial Corp. and
Subsidiaries |
| |
| Consolidated Statements of Financial
Condition |
| |
At June 30,
2018 |
At December 31,
2017 |
| (Dollars in
thousands, except per share amounts) |
|
|
| Cash and due from banks |
$ |
1,654 |
|
$ |
2,030 |
|
| Interest-earning demand deposits with banks |
14,660 |
|
20,279 |
|
| Cash and Cash Equivalents |
16,314 |
|
22,309 |
|
| Securities held to maturity (fair value of $43,749 and
$38,255, respectively) |
44,770 |
|
38,482 |
|
| Loans receivable, net of allowance for loan losses of $5,596
and $5,414, respectively |
509,689 |
|
473,405 |
|
| Premises and equipment |
8,461 |
|
8,698 |
|
| Federal Home Loan Bank of New York stock, at cost |
4,212 |
|
2,131 |
|
| Bank owned life insurance |
14,392 |
|
14,197 |
|
| Accrued interest receivable |
1,754 |
|
1,607 |
|
| Other assets |
1,657 |
|
2,211 |
|
| Total Assets |
$ |
601,249 |
|
$ |
563,040 |
|
| Liabilities and Stockholders' Equity |
|
|
|
Liabilities |
|
|
| Deposits: |
|
|
| Non-interest bearing |
$ |
42,687 |
|
$ |
36,919 |
|
| Interest bearing |
405,825 |
|
411,994 |
|
| Total Deposits |
448,512 |
|
448,913 |
|
| Advances from Federal Home Loan Bank of New York |
82,175 |
|
37,675 |
|
| Advance payments by borrowers for taxes and insurance |
772 |
|
686 |
|
| Other liabilities |
1,284 |
|
2,741 |
|
| Total Liabilities |
532,743 |
|
490,015 |
|
|
Stockholders' Equity |
|
|
| Preferred stock, par value $0.01; 1,000,000 shares
authorized; no shares issued or outstanding |
— |
|
— |
|
| Common stock, par value $0.01; 49,000,000 shares authorized;
5,513,165 and 5,768,632 issued and outstanding at June 30, 2018 and
December 31, 2017, respectively |
55 |
|
58 |
|
| Paid-in capital |
46,688 |
|
51,068 |
|
| Retained earnings |
23,450 |
|
23,641 |
|
| Unearned common stock held by ESOP (184,942 and 190,390
shares, respectively) |
(1,687 |
) |
(1,742 |
) |
| Total Stockholders' Equity |
68,506 |
|
73,025 |
|
| Total Liabilities and Stockholders'
Equity |
$ |
601,249 |
|
$ |
563,040 |
|
| |
|
|
| |
| |
|
|
|
|
|
|
|
|
| MSB Financial Corp. and
Subsidiaries |
| |
| Consolidated Statements of Income |
| |
|
Three Months
EndedJune 30, |
|
Six Months
Ended June 30, |
| |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
| (in
thousands except per share amounts) |
|
|
|
|
|
|
|
|
|
Interest Income |
|
|
|
|
|
|
|
|
| Loans receivable, including fees |
|
$ |
5,436 |
|
|
$ |
4,444 |
|
|
$ |
10,572 |
|
|
$ |
8,444 |
|
| Securities held to maturity |
|
240 |
|
|
247 |
|
|
459 |
|
|
498 |
|
| Other |
|
62 |
|
|
36 |
|
|
136 |
|
|
78 |
|
| Total Interest Income |
|
5,738 |
|
|
4,727 |
|
|
11,167 |
|
|
9,020 |
|
|
Interest Expense |
|
|
|
|
|
|
|
|
| Deposits |
|
935 |
|
|
579 |
|
|
1,781 |
|
|
1,081 |
|
| Borrowings |
|
372 |
|
|
224 |
|
|
653 |
|
|
420 |
|
| Total Interest Expense |
|
1,307 |
|
|
803 |
|
|
2,434 |
|
|
1,501 |
|
| Net Interest Income |
|
4,431 |
|
|
3,924 |
|
|
8,733 |
|
|
7,519 |
|
|
Provision for Loan Losses |
|
90 |
|
|
300 |
|
|
180 |
|
|
495 |
|
| Net Interest Income after Provision for Loan
Losses |
|
4,341 |
|
|
3,624 |
|
|
8,553 |
|
|
7,024 |
|
|
Non-Interest Income |
|
|
|
|
|
|
|
|
| Fees and service charges |
|
91 |
|
|
98 |
|
|
174 |
|
|
169 |
|
| Income from bank owned life insurance |
|
98 |
|
|
105 |
|
|
195 |
|
|
212 |
|
| Other |
|
19 |
|
|
16 |
|
|
43 |
|
|
25 |
|
| Total Non-Interest Income |
|
208 |
|
|
219 |
|
|
412 |
|
|
406 |
|
|
Non-Interest Expenses |
|
|
|
|
|
|
|
|
| Salaries and employee benefits |
|
1,677 |
|
|
1,578 |
|
|
3,482 |
|
|
3,084 |
|
| Directors compensation |
|
122 |
|
|
187 |
|
|
244 |
|
|
363 |
|
| Occupancy and equipment |
|
397 |
|
|
429 |
|
|
782 |
|
|
823 |
|
| Service bureau fees |
|
77 |
|
|
49 |
|
|
144 |
|
|
97 |
|
| Advertising |
|
9 |
|
|
5 |
|
|
13 |
|
|
8 |
|
| FDIC assessment |
|
69 |
|
|
37 |
|
|
123 |
|
|
70 |
|
| Professional services |
|
336 |
|
|
349 |
|
|
689 |
|
|
708 |
|
| Other |
|
212 |
|
|
184 |
|
|
409 |
|
|
382 |
|
| Total Non-Interest Expenses |
|
2,899 |
|
|
2,818 |
|
|
5,886 |
|
|
5,535 |
|
|
Income before Income Taxes |
|
1,650 |
|
|
1,025 |
|
|
3,079 |
|
|
1,895 |
|
| Income Tax Expense |
|
407 |
|
|
293 |
|
|
814 |
|
|
614 |
|
| Net
Income |
|
$ |
1,243 |
|
|
$ |
732 |
|
|
$ |
2,265 |
|
|
$ |
1,281 |
|
|
Earnings per share: |
|
|
|
|
|
|
|
|
| Basic |
|
$ |
0.23 |
|
|
$ |
0.13 |
|
|
$ |
0.42 |
|
|
$ |
0.23 |
|
| Diluted |
|
$ |
0.23 |
|
|
$ |
0.13 |
|
|
$ |
0.42 |
|
|
$ |
0.23 |
|
| |
|
|
|
|
|
|
|
|
| |
| |
|
|
|
|
|
| MSB Financial Corp. and
Subsidiaries |
| |
|
|
|
|
|
| Selected Quarterly Financial and Statistical
Data |
| |
Three Months Ended |
| (in
thousands, except for share and per share data) (annualized where
applicable) |
6/30/2018 |
|
3/31/2018 |
|
6/30/2017 |
|
(unaudited) |
|
|
|
|
|
| Statements of Operations Data |
|
|
|
|
|
| |
|
|
|
|
|
| Interest income |
$ |
5,738 |
|
|
$ |
5,429 |
|
|
$ |
4,727 |
|
| Interest expense |
1,307 |
|
|
1,127 |
|
|
803 |
|
| Net interest income |
4,431 |
|
|
4,302 |
|
|
3,924 |
|
| Provision for loan losses |
90 |
|
|
90 |
|
|
300 |
|
| Net interest income after provision for loan losses |
4,341 |
|
|
4,212 |
|
|
3,624 |
|
| Other income |
208 |
|
|
204 |
|
|
219 |
|
| Other expense |
2,899 |
|
|
2,987 |
|
|
2,818 |
|
| Income before income taxes |
1,650 |
|
|
1,429 |
|
|
1,025 |
|
| Income tax expense (benefit) |
407 |
|
|
407 |
|
|
293 |
|
| Net Income |
$ |
1,243 |
|
|
$ |
1,022 |
|
|
$ |
732 |
|
| Earnings (per Common Share) |
|
|
|
|
|
| Basic |
$ |
0.23 |
|
|
$ |
0.19 |
|
|
$ |
0.13 |
|
| Diluted |
$ |
0.23 |
|
|
$ |
0.19 |
|
|
$ |
0.13 |
|
| Statements of Condition Data
(Period-End) |
|
|
|
|
|
| Investment securities held to maturity (fair value of
$43,749, $35,561, and $42,523) |
$ |
44,770 |
|
|
$ |
36,375 |
|
|
$ |
42,441 |
|
| Loans receivable, net of allowance for loan losses |
509,689 |
|
|
480,916 |
|
|
426,370 |
|
| Total assets |
601,249 |
|
|
564,027 |
|
|
507,098 |
|
| Deposits |
448,512 |
|
|
433,843 |
|
|
390,063 |
|
| Borrowings |
82,175 |
|
|
58,075 |
|
|
38,675 |
|
| Stockholders' equity |
68,506 |
|
|
69,759 |
|
|
74,989 |
|
| Common Shares Dividend Data |
|
|
|
|
|
| Cash dividends |
$ |
2,456 |
|
|
$ |
— |
|
|
$ |
— |
|
| Weighted Average Common Shares
Outstanding |
|
|
|
|
|
| Basic |
5,331,090 |
|
|
5,470,349 |
|
|
5,539,796 |
|
| Diluted |
5,375,090 |
|
|
5,507,443 |
|
|
5,679,012 |
|
| Operating Ratios |
|
|
|
|
|
| Return on average assets |
0.87 |
% |
|
0.74 |
% |
|
0.59 |
% |
| Return on average equity |
7.17 |
% |
|
5.65 |
% |
|
3.91 |
% |
| Average equity / average assets |
12.16 |
% |
|
13.06 |
% |
|
15.19 |
% |
| Book value per common share (period-end) |
$ |
12.43 |
|
|
$ |
12.63 |
|
|
$ |
13.07 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
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