NEWTOWN, Pa., April 25, 2013 (GLOBE NEWSWIRE) -- TF Financial Corporation (Nasdaq:THRD) today reported net income of $1,223,000 ($0.45 per diluted share) for the first quarter of 2013, a 5.9% increase when compared with $1,155,000 ($0.42 per diluted share) for the first quarter of 2012. The Company also announced that its Board of Directors declared a quarterly dividend of $0.05 per share, payable May 15, 2013, to shareholders of record on May 8, 2013.
"We produced another consistent, profitable quarter in which there was excellent progress in reducing problem assets," said Kent C. Lufkin, President and Chief Executive Officer. "Nonperforming loans declined to $7.6 million or 1.45% of total loans at quarter end, down from $13.9 million or 2.79% of total loans at quarter-end a year ago. Notably, foreclosed properties were reduced by $3.1 million year-over-year to $7.2 million at March 31, 2013."
"Encouragingly, the local economy continues to improve and good, well-qualified borrowers are stepping up both consumer and commercial loan demand as they re-enter the marketplace. Our commercial loan pipelines are currently stronger than at any point of the past 24 months," Lufkin said.
Results for the first quarter included:
- Pre-tax income was $1,804,000 for the quarter, an increase of $331,000 over the first quarter of 2012. The key drivers of this increase were an $86,000 increase in net interest income, a $61,000 decrease in the provision for loan losses and a $158,000 increase in non-interest income, mainly the result of a $417,000 gain related to an eminent domain matter affecting a parcel of Company property, a $153,000 increase over the amount recorded in 2012 related to the same matter, which is now finalized. Weighing on operating results during the first quarter of 2013 compared with the first quarter of 2012 were $320,000 of merger costs, treated as non-deductible for tax purposes at this time, related to the previously-announced agreement for the acquisition of Roebling Financial Corp, Inc. by the Company. These expenses were largely the cause of the increase in the Company's effective tax rate to 32.2% during the first quarter of 2013 from 21.6% during the first quarter of 2012.
- Net interest income was $5,878,000 which was an $86,000 or 1.5% increase when compared with the first quarter of 2012, driven by a $25.3 million increase in average earning assets, while the Company's net interest margin decreased by a modest 5 basis points to 3.73% from 3.78%. The yields on the Company's interest-earning assets fell by 38 basis points for the first quarter of 2013 compared with the first quarter of 2012, mainly due to the consequences of record-low market interest rates which have existed since the first quarter of 2012, causing mortgage loan borrowers to refinance their higher rate loans into those with lower rates and the resulting downward drift in the Company's loan and mortgage-backed securities yields. However, the cost of the Company's interest bearing liabilities improved by 34 basis points since the first quarter of 2012, primarily the result of a 24 basis point or 31.2% improvement in the cost of deposits, due to a favorable change in the deposit pricing and mix, and the maturity of time deposits which had been originated during periods of higher market interest rates.
- The provision for loan losses was $439,000 for the quarter compared with $500,000 for the first quarter of 2012. The allowance for loan losses stood at approximately $6.7 million at March 31, 2013. Charge-offs during the first quarter of 2013 were $699,000 compared with $1.6 million during the first quarter of 2012. The allowance for loan losses was 1.26% of total loans and 87.12% of non-performing loans at March 31, 2013.
- Asset quality continued to show improvement with total non-performing assets at 2.07% of total assets, down from 2.20% at year end 2012 and 3.48% at March 31, 2012. Non-performing loans were $7.6 million or 1.45% of total loans at quarter end compared with $8.4 million or 1.56% of total loans at December 31, 2012 and $13.9 million or 2.79% of total loans at March 31, 2012. Foreclosed property at March 31, 2013 was $7.2 million compared with $7.3 million at December 31, 2012 and $10.2 million at March 31, 2012.
- Loans totaled were $528.2 million, a $29.9 million or 6.0% increase since the end of the first quarter of 2012. Mortgage loans originated for sale were $11.7 million compared with $15.9 million for the first quarter of 2012.
- At quarter end, total deposits were $571.3 million, an $11.0 million or 2.0% increase when compared with December 31, 2012, led by a $5.0 million increase in non-interest bearing checking accounts.
- Non-interest expenses were $26,000 lower in the first quarter of 2013 compared to the first quarter of 2012. However, excluding merger-related expenses, total non-interest expenses were $346,000 lower during the first quarter of 2013 compared with the first quarter of 2012, with each category of expenses showing improvement. The Company's efficiency ratio, which excludes certain non-operating items, was 64.56% during the first quarter of 2013 compared with 70.55% during the first quarter of 2012.
TF Financial Corporation is a holding company whose principal subsidiary is 3rd Fed Bank, which operates 13 full service retail and commercial banking offices in Philadelphia and Bucks County, Pennsylvania and in Mercer County, New Jersey. Deposits at 3rd Fed Bank are insured up to the maximum amount by the Federal Deposit Insurance Corporation (FDIC). In addition, the Bank's website can be found at www.3rdfedbank.com. Statements contained in this news release that are not historical facts are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, factors discussed in documents filed by TF Financial Corporation with the Securities and Exchange Commission from time to time. The Company does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company.
T F FINANCIAL CORPORATION | |||||
UNAUDITED FINANCIAL INFORMATION | |||||
(dollars in thousands except per share data) | QUARTER ENDED | ||||
3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |
EARNINGS SUMMARY | |||||
Interest income | $ 6,857 | $ 7,234 | $ 7,395 | $ 7,328 | $ 7,263 |
Interest expense | 979 | 1,048 | 1,141 | 1,277 | 1,471 |
Net interest income | 5,878 | 6,186 | 6,254 | 6,051 | 5,792 |
Loan loss provision | 439 | 650 | 750 | 500 | 500 |
Non-interest income | 1,395 | 1,196 | 914 | 739 | 1,237 |
Non-interest expense | 5,030 | 4,690 | 4,466 | 4,649 | 5,056 |
Income before taxes | 1,804 | 2,042 | 1,952 | 1,641 | 1,473 |
Income taxes | 581 | 536 | 479 | 392 | 318 |
Net income | $ 1,223 | $ 1,506 | $ 1,473 | $ 1,249 | $ 1,155 |
PER SHARE INFORMATION | |||||
Earnings per share, basic | $ 0.45 | $ 0.55 | $ 0.54 | $ 0.46 | $ 0.42 |
Earnings per share, diluted | $ 0.45 | $ 0.55 | $ 0.54 | $ 0.46 | $ 0.42 |
Weighted average basic shares (000's) | 2,738 | 2,733 | 2,729 | 2,724 | 2,719 |
Weighted average diluted shares (000's) | 2,742 | 2,734 | 2,732 | 2,728 | 2,722 |
Dividends paid | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 |
FINANCIAL RATIOS | |||||
Annualized return on average assets | 0.70% | 0.86% | 0.84% | 0.74% | 0.68% |
Annualized return on average equity | 5.92% | 7.21% | 7.21% | 6.31% | 5.94% |
Efficiency ratio (1) | 64.56% | 60.98% | 60.24% | 62.34% | 70.55% |
REGULATORY CAPITAL RATIOS | |||||
Tier 1 leverage ratio | 10.50% | 10.45% | 10.47% | 10.45% | 10.21% |
Total risk-based capital ratio | 17.90% | 17.89% | 17.62% | 17.37% | 17.41% |
Tier 1 risk-based capital ratio | 16.65% | 16.63% | 16.37% | 16.13% | 16.16% |
T F FINANCIAL CORPORATION | |||||
UNAUDITED FINANCIAL INFORMATION | |||||
(dollars in thousands except per share data) | QUARTER ENDED | ||||
3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |
AVERAGE BALANCES | |||||
Loans | $ 525,275 | $ 530,026 | $ 527,195 | $ 501,757 | $ 493,396 |
Mortgage-backed securities | 41,988 | 49,383 | 55,820 | 61,580 | 61,971 |
Investment securities | 65,131 | 63,773 | 64,304 | 68,181 | 67,035 |
Other interest-earning assets | 28,877 | 6,482 | 393 | 3,074 | 13,619 |
Total earning assets | 661,271 | 649,664 | 647,712 | 634,592 | 636,021 |
Non-earning assets | 46,572 | 46,985 | 46,168 | 48,329 | 50,557 |
Total assets | 707,843 | 696,649 | 693,880 | 682,921 | 686,578 |
Deposits | 560,750 | 539,653 | 538,637 | 550,040 | 554,523 |
FHLB advances and other borrowed money | 56,114 | 66,223 | 66,740 | 46,785 | 47,387 |
Total interest bearing liabilities | 616,864 | 605,876 | 605,377 | 596,825 | 601,910 |
Non-interest bearing liabilities | 7,216 | 7,629 | 7,179 | 6,486 | 6,523 |
Stockholders' equity | 83,763 | 83,144 | 81,324 | 79,610 | 78,145 |
Total liabilities & stockholders' equity | $ 707,843 | $ 696,649 | $ 693,880 | $ 682,921 | $ 686,578 |
SPREAD AND MARGIN ANALYSIS (TAX EQUIVALENT) | |||||
Average yield on: | |||||
Loans | 4.68% | 4.76% | 4.86% | 4.99% | 5.05% |
Mortgage-backed securities | 2.64% | 3.04% | 3.23% | 3.68% | 3.50% |
Investment securities | 4.43% | 4.37% | 4.32% | 4.31% | 4.27% |
Other interest-earning assets | 0.06% | 0.37% | 0.00% | 0.00% | 0.06% |
Total interest-earning assets | 4.33% | 4.55% | 4.66% | 4.77% | 4.71% |
Average cost of: | |||||
Deposits | 0.53% | 0.54% | 0.59% | 0.68% | 0.77% |
FHLB advances and other borrowed money | 1.79% | 1.87% | 2.01% | 3.02% | 3.44% |
Total interest-bearing liabilities | 0.64% | 0.69% | 0.75% | 0.86% | 0.98% |
Interest rate spread | 3.68% | 3.86% | 3.91% | 3.91% | 3.73% |
Net interest margin | 3.73% | 3.90% | 3.96% | 3.96% | 3.78% |
T F FINANCIAL CORPORATION | |||||
UNAUDITED FINANCIAL INFORMATION | |||||
(dollars in thousands except per share data) | QUARTER ENDED | ||||
3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |
INTEREST INCOME AND EXPENSE DETAIL | |||||
Interest income on: | |||||
Loans | $ 6,066 | $ 6,341 | $ 6,436 | $ 6,231 | $ 6,197 |
Mortgage-backed securities | 273 | 377 | 453 | 564 | 539 |
Investment securities | 711 | 701 | 699 | 731 | 712 |
Other interest-earning assets | 4 | 6 | -- | -- | 2 |
Total interest-earning assets | $ 7,054 | $ 7,425 | $ 7,588 | $ 7,526 | $ 7,450 |
Interest expense on: | |||||
Deposits | $ 731 | $ 737 | $ 803 | $ 926 | $ 1,066 |
FHLB advances and other borrowed money | 248 | 311 | 338 | 351 | 405 |
Total interest-bearing liabilities | $ 979 | $ 1,048 | $ 1,141 | $ 1,277 | $ 1,471 |
Net interest income: tax equivalent basis | $ 6,075 | $ 6,377 | $ 6,447 | $ 6,249 | $ 5,979 |
Tax equivalent adjustment on investment securities | 197 | 191 | 193 | 198 | 187 |
Net interest income | $ 5,878 | $ 6,186 | $ 6,254 | $ 6,051 | $ 5,792 |
NON-INTEREST INCOME DETAIL | |||||
Service fees, charges and other | $ 497 | $ 484 | $ 433 | $ 448 | $ 458 |
Impairment adjustment to mortgage servicing rights | 33 | 50 | (53) | (75) | 39 |
Bank-owned life insurance | 143 | 147 | 152 | 152 | 152 |
Gain on sale of investment securities | -- | 85 | -- | -- | -- |
Gain on sale of loans | 305 | 430 | 382 | 214 | 324 |
Gain on disposition of real estate | 417 | -- | -- | -- | 264 |
NON-INTEREST EXPENSE DETAIL | |||||
Compensation and benefits | $ 2,817 | $ 2,760 | $ 2,651 | $ 2,697 | $ 2,874 |
Occupancy and equipment | 697 | 727 | 686 | 672 | 710 |
Professional fees | 288 | 302 | 349 | 174 | 351 |
Merger-related costs | 320 | 108 | -- | -- | -- |
Marketing and advertising | 39 | 79 | 76 | 106 | 85 |
FDIC insurance premiums | 110 | 149 | 146 | 150 | 151 |
Loss on foreclosed real estate | 178 | 46 | -- | 246 | 179 |
Operating expenses on foreclosed real estate | 46 | 60 | 78 | 94 | 108 |
Other operating | 535 | 459 | 480 | 510 | 598 |
T F FINANCIAL CORPORATION | |||||
UNAUDITED FINANCIAL INFORMATION | |||||
(dollars in thousands except per share data) | PERIOD ENDED | ||||
3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |
DEPOSIT INFORMATION | |||||
Non-interest checking | $ 57,422 | $ 52,433 | $ 50,421 | $ 47,826 | $ 49,408 |
Interest checking | 78,263 | 76,370 | 70,797 | 74,925 | 69,195 |
Money market | 156,736 | 153,827 | 153,351 | 151,375 | 154,417 |
Savings | 108,554 | 106,268 | 106,693 | 107,924 | 108,219 |
CD's | 170,355 | 171,417 | 152,011 | 164,990 | 180,962 |
OTHER INFORMATION | |||||
Per Share | |||||
Book value | $ 29.37 | $ 29.23 | $ 28.89 | $ 28.25 | $ 27.71 |
Tangible book value | $ 27.85 | $ 27.70 | $ 27.37 | $ 26.73 | $ 26.18 |
Closing market price | $ 25.15 | $ 23.83 | $ 23.79 | $ 24.66 | $ 24.20 |
Balance Sheet | |||||
Loans | $ 528,229 | $ 534,348 | $ 541,610 | $ 519,946 | $ 498,357 |
Cash and cash equivalents | 48,690 | 31,137 | 3,712 | 4,367 | 22,340 |
Mortgage-backed securities | 38,320 | 44,639 | 51,463 | 58,753 | 63,988 |
Investment securities | 63,987 | 65,041 | 63,822 | 66,012 | 69,556 |
Total assets | 716,002 | 711,836 | 697,056 | 685,387 | 693,421 |
Total deposits | 571,330 | 560,315 | 533,273 | 547,040 | 562,201 |
FHLB advances and other borrowed money | 54,151 | 60,656 | 75,156 | 51,084 | 46,685 |
Stockholders' equity | 83,408 | 82,945 | 81,965 | 80,102 | 78,528 |
Asset Quality | |||||
Non-performing loans | $ 7,647 | $ 8,359 | $ 10,400 | $ 12,566 | $ 13,889 |
Allowance for loan losses | $ 6,662 | $ 6,922 | $ 6,772 | $ 6,163 | $ 6,981 |
Net charge-offs | $ 699 | $ 500 | $ 141 | $ 1,318 | $ 1,619 |
Allowance for loan losses to non-performing loans | 87.12% | 82.81% | 65.12% | 49.05% | 50.26% |
Allowance for loan losses to gross loans | 1.26% | 1.30% | 1.25% | 1.19% | 1.40% |
Non-performing loans to gross loans | 1.45% | 1.56% | 1.92% | 2.42% | 2.79% |
Non-performing loans to total assets | 1.07% | 1.17% | 1.49% | 1.83% | 2.00% |
Foreclosed property | $ 7,170 | $ 7,282 | $ 7,619 | $ 6,625 | $ 10,247 |
Foreclosed property to total assets | 1.00% | 1.02% | 1.09% | 0.97% | 1.48% |
Non-performing assets to total assets | 2.07% | 2.20% | 2.59% | 2.80% | 3.48% |
Statistical | |||||
Shares outstanding (000's) | 2,840 | 2,838 | 2,837 | 2,835 | 2,834 |
Number of branch offices | 13 | 13 | 14 | 14 | 14 |
Full time equivalent employees | 165 | 167 | 167 | 171 | 176 |
(1) The efficiency ratio is non-interest expense excluding merger-related costs and loss on foreclosed real estate divided by net interest income on a tax equivalent basis plus non-interest income excluding impairment adjustment to mortgage servicing rights, gain on sale of investment securities, and gain on disposition of real estate. |