LAFAYETTE, Ind., May 2 /PRNewswire-FirstCall/ -- LSB Financial Corp. , the parent company of Lafayette Savings Bank, FSB, today reported earnings for the quarter ended March 31, 2008. Compared to the first quarter of 2007, net income was $515,000, down 33.9%, resulting in diluted earnings per share of $0.33. LSB Financial President & CEO, Randolph F. Williams stated, "The current banking environment is extremely challenging, and I am pleased with our recent growth and positive trends. We are starting to see activity in the real estate market and loans were up $7.1 million, or 2.3%, compared to year-end. Deposits also increased over $8.5 million, or 3.7%, during the quarter."
Williams continued, "Largely as a result of the Fed cutting short term interest rates, an unprecedented 3.0% in just six months, the net interest margin for the first quarter of 2008 was down 37 basis points to 3.11% when compared to the previous year. This translates to a $424,000 decrease in net interest income. While interest rate changes are out of our control, our managers have done a remarkable job of improving asset quality, growing core deposits, and containing expenses. At quarter end, non-performing loans totaled $8.3 million or 2.69% of total loans, compared to $10.0 million, or 3.32%, at December 31, 2007 and $12.5 million, or 3.97%, one year ago."
Williams continued, "Despite the fact that Tippecanoe County's unemployment rate has been increasing since year end, we are seeing signs of an improving economy. Our delinquent loans are at a 19-month low, properties are selling at closer to the appraised values and there has been a slowing in the rate of local foreclosures and bankruptcies. Data from March of this year indicates that Indiana is now 11th in the country in foreclosures, with one out of every 538 households facing foreclosure. Last year Indiana was ranked in the top three."
The Company also announced that it will pay a quarterly cash dividend of $0.25 per share to shareholders of record as of the close of business on May 9, 2008 with a payment date of June 6, 2008. Williams stated, "At slower growth times like this, we are pleased to be able to return equity to our shareholders in the form of a higher dividend. This is particularly significant based on the current favorable dividend tax rate."
The closing market price of LSB stock on May 1, 2006 was $18.00 per share as reported by the NASDAQ National Market.
LSB FINANCIAL CORP. SELECTED CONSOLIDATED FINANCIAL INFORMATION (Dollars in thousands except share and per share amounts) Three months Year ended Selected balance sheet data: ended December 31, March 31, 2008 2007 Cash and due from banks $1,487 $1,644 Short-term investments 11,852 4,846 Securities available-for-sale 12,992 13,221 Loans held for sale 247 --- Net portfolio loans 303,766 296,908 Allowance for loan losses 3,277 3,702 Premises and equipment, net 6,736 6,815 Federal Home Loan Bank stock, at cost 3,997 3,997 Bank owned life insurance 5,671 5,613 Other assets 7,593 8,966 Total assets 354,341 342,010 Deposits 240,560 232,030 Advances from Federal Home Loan Bank 77,256 74,256 Other liabilities 2,338 1,792 Shareholders' equity 34,187 33,932 Book value per share $21.92 $22.07 Equity / assets 9.65 % 9.92 % Total shares outstanding 1,559,409 1,557,968 Asset quality data: Non-accruing loans $6,592 $9,935 Loans past due 90 days still on accrual 1,669 59 Other real estate / assets owned 3,291 3,944 Total non-performing assets 11,552 13,938 Non-performing loans / total loans 2.69 % 3.32 % Non-performing assets / total assets 3.26 % 4.08 % Allowance for loan losses / non-performing loans 39.67 % 37.04 % Allowance for loan losses / non-performing assets 28.37 % 26.56 % Allowance for loan losses / total loans 1.07 % 1.23 % Loans charged off (quarter-to-date and year-to-date, respectively) $676 $672 Recoveries on loans previously charged off 1 38 Three months ended March 31, Selected operating data: 2008 2007 Total interest income $5,421 $5,869 Total interest expense 2,878 2,902 Net interest income 2,543 2,967 Provision for loan losses 250 250 Net interest income after provision for loan losses 2,293 2,717 Non-interest income: Deposit account service charges 396 406 Gain on sale of mortgage loans 16 42 Gain on sale of securities 0 0 Net gain on sale of real estate owned 91 0 Other non-interest income 279 252 Total non-interest income 782 700 Non-interest expense: Salaries and benefits 1,227 1,190 Occupancy and equipment, net 344 314 Computer service 135 121 Advertising 69 41 Other 558 523 Total non-interest expense 2,333 2,189 Income before income taxes 742 1,228 Income tax expense 227 449 Net income 515 779 Weighted average number of diluted shares 1,560,997 1,612,091 Diluted earnings per share $0.33 $0.48 Return on average equity 6.03 % 8.87 % Return on average assets 0.59 % 0.86 % Average earning assets $327,333 $341,323 Net interest margin 3.11 % 3.48 % Efficiency ratio 75.87 % 64.06 %
