HUNTINGTON, Ind., Oct. 13 /PRNewswire-FirstCall/ -- Northeast Indiana Bancorp, Inc. (BULLETIN BOARD: NIDB) , the parent company of First Federal Savings Bank, today announced net income of $518,000 ($0.42 per diluted common share) for the Company's third quarter ended September 30, 2009 compared to a net loss of ($967,000) ($0.79 per diluted common share) for the third quarter ended September 30, 2008. The prior year quarterly period contained non-cash other than temporary impairment ("OTTI") write-downs of $1.7 million taken on FHLMC Preferred Shares and in the bank's investment in the Shay Ultrashort Mortgage Fund as well as specific reserves established of $280,000 on four real estate owned properties. The current three months earnings equates to an annualized return on average assets (ROA) of 0.82% and a return on average equity (ROE) of 9.20%.
Net interest income increased sharply by $341,000 or 19.4% to $2.1 million for the quarter ended September 30, 2009 when compared to $1.8 million for the quarter ended September 30, 2008. The Company's net interest margin increased significantly by sixty-five basis points to 3.53% for the current quarter compared to 2.88% in the year earlier quarter. On a linked quarter basis, the Company's 3.53% net interest margin was ten basis points higher during the current quarter ended September 30, 2009 compared to 3.43% during the quarter ended June 30, 2009.
The Company made a $350,000 provision for loan loss during the quarter ended September 30, 2009 compared to a $100,000 provision for loan loss for the quarter ended September 30, 2008. Management continues to feel it is prudent to increase the allowance for loan losses by setting aside provisions for loan losses at higher levels during these uncertain economic conditions. The Company experienced net charge-offs of $89,000 for the quarter ended September 30, 2009 compared to net charge-offs of $1.4 million for the quarter ended September 30, 2008.
Noninterest income increased to $669,000 for the third quarter ended September 30, 2009 compared to ($1.2 million) during the quarter ended September 30, 2008. The significant increase is mostly due to the OTTI write-downs discussed above on FHLMC preferred shares and the Shay fund during the prior quarterly period. Net gain on the sale of loans also increased $177,000 or 316.4% to $233,000 during the quarter ended September 30, 2009 due to increased sales volumes to FHLMC and the SBA.
Noninterest expense decreased $68,000 from $1.7 million for the quarter ended September 30, 2008 to $1.6 million for the quarter ended September 30, 2009. The decrease was mostly due to no valuation allowances on repossessed assets for the current quarterly period compared to $280,000 during the three months ended September 30, 2008.
This sharp reduction was partially offset by increases in occupancy, wages, professional fees and FDIC insurance premiums between quarterly periods. Wages and occupancy increases were related to the opening of the bank's fifth full service branch in Fort Wayne, Indiana during the current quarter as well as an increase in property taxes on existing branches.
Net income for the nine months ended September 30, 2009 increased to $1.5 million ($1.24 per diluted common share) compared to a net loss of ($200,000) ($0.16 per diluted common share) for the nine months ended September 30, 2008. This increase is mostly due to the non-cash OTTI charges taken during the quarter ended September 30, 2008 as discussed above. Net interest income increased $1.2 million or 25.5% to $6.1 million for the nine months ended September 30, 2009 compared to $4.9 million for the prior year nine month period. Noninterest income increased sharply due to the OTTI charges in the prior year period but net gain on sale of loans also increased $552,000 or 500% between periods. Noninterest expense was higher for the nine months ended September 30, 2009 primarily due to the sharp increase of $256,000 or 366% in FDIC insurance premiums between nine month periods. Most noninterest expense increases were partially offset by a reduction in valuation allowances on repossessed assets of $360,000 during the prior year nine month period.
Total assets decreased $12.7 million or 4.9% to $247.5 million at September 30, 2009 compared to December 31, 2008 assets of $260.2 million. The asset decline is primarily due to large noninterest bearing funds on hand at year end 2008 clearing early in first quarter 2009 as well as a reduction in single family portfolio mortgage balances due to most fixed rate originations being sold servicing retained to FHLMC. Net loans decreased $7.1 million to $197.1 million at September 30, 2009 compared to $204.2 million at December 31, 2008. Total deposits increased $2.4 million to $158.1 million at September 30, 2009 from $155.7 million at December 31, 2008. Borrowed funds decreased $15.7 million to $64.3 million at September 30, 2009 compared to $80.0 million at December 31, 2008. Proceeds from the sale of fixed rate mortgages to FHLMC were used to pay down borrowed funds.
Shareholders' equity at September 30, 2009 was $22.9 million compared to $21.8 million at December 31, 2008. The book value of NEIB's stock was $18.60 per common share as of September 30, 2009. The number of outstanding common shares was 1,230,670. The last reported trade of the stock on October 12, 2009 was $9.25 per common share.
Northeast Indiana Bancorp, Inc. is headquartered at 648 N. Jefferson Street, Huntington, Indiana. The company offers a full array of banking and financial brokerage services to its customers through its main office in Huntington and four full-service Indiana offices in Huntington (2), Warsaw and Fort Wayne. The Company is traded on the Over the Counter Bulletin Board under the symbol "NIDB". Our web site address is http://www.firstfedindiana.com/.
This press release may contain forward-looking statements, which are based on management's current expectations regarding economic, legislative and regulatory issues. Factors which may cause future results to vary materially include, but are not limited to, general economic conditions, changes in interest rates, loan demand, and competition. Additional factors include changes in accounting principles, policies or guidelines; changes in legislation or regulation; and other economic, competitive, regulatory and technological factors affecting each company's operations, pricing, products and services.
NORTHEAST INDIANA BANCORP CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) ------------------------------------------------------------------------ CONSOLIDATED STATEMENT OF FINANCIAL CONDITION ASSETS September 30, December 31, 2009 2008 ------------- ------------- Interest-earning cash and cash equivalents $1,957,446 $6,122,439 Noninterest earning cash and cash equivalents 1,732,062 2,284,062 ------------- ------------- Total cash and cash equivalents 3,689,508 8,406,501 Securities available for sale 32,545,085 33,022,602 Securities held to maturity 550,000 550,000 Loans held for sale 168,000 709,400 Loans receivable, net of allowance for loan loss September 30, 2009 $2,422,874 and December 31, 2008 $1,750,605 197,114,642 204,171,179 Accrued interest receivable 1,012,825 1,070,708 Premises and equipment 2,181,119 2,178,416 Investments in limited liability partnerships 353,802 462,279 Cash surrender value of life insurance 6,442,915 6,253,417 Other assets 3,457,262 3,415,020 ------------- ------------- Total Assets $247,515,158 $260,239,522 ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY Non-interest bearing deposits 9,758,793 19,873,896 Interest bearing deposits 148,356,373 135,824,869 Borrowed Funds 64,268,992 79,982,575 Accrued interest payable and other liabilities 2,238,087 2,782,849 ------------- ------------- Total Liabilities 224,622,245 238,464,189 ------------- ------------- Retained earnings - substantially restricted 22,892,913 21,775,333 ------------- ------------- Total Liabilities and Shareholders' Equity $247,515,158 $260,239,522 ============= ============= ------------------------------------------------------------------------ CONSOLIDATED STATEMENTS OF INCOME Three Months Ended Nine Months Ended September 30, September 30, 2009 2008 2009 2008 ---- ---- ---- ---- Total interest income $3,462,834 $3,663,318 $10,446,720 $10,825,370 Total interest expense 1,369,172 1,910,458 4,351,652 5,968,852 ------------------------------------------------------------------------ Net interest income $2,093,662 $1,752,860 $6,095,068 $4,856,518 ------------------------------------------------------------------------ Provision for loan losses 350,000 100,000 925,000 280,000 Net interest income after provision for loan losses $1,743,662 $1,652,860 $5,170,068 $4,576,518 Service charges on deposit accounts 188,516 193,025 519,706 531,391 Net (loss) on sale of securities (37,346) (31,140) (84,135) (18,726) Other than temporary impairment-securities - (1,677,916) - (1,677,916) Net gain on sale of loans 232,774 55,903 662,010 110,390 Net (loss) on sale of repossessed assets (33,064) (5,822) (126,656) (15,554) Brokerage fees 77,279 97,438 215,690 303,449 Increase in cash surrender value of life insurance 61,626 60,744 189,499 184,443 Other income 179,317 150,412 493,521 439,605 ------------------------------------------------------------------------ Total noninterest income $669,102 $(1,157,356) $1,869,635 $(142,918) ------------------------------------------------------------------------ Salaries and employee benefits 817,746 752,334 2,314,347 2,314,924 Occupancy 234,574 168,315 629,670 566,815 Data processing 181,915 168,506 566,629 501,061 Deposit insurance premiums 90,000 62,188 326,000 69,954 Professional fees 89,276 44,930 202,156 117,756 Correspondent bank charges 28,729 30,837 91,448 101,867 Valuation allowances - repossessed assets - 280,000 - 360,000 Other expense 204,388 207,471 644,631 625,465 ------------------------------------------------------------------------ Total noninterest expenses $1,646,628 $1,714,581 $4,774,881 $4,657,842 ------------------------------------------------------------------------ Income/(Loss) before income tax expense $766,136 $(1,219,077) $2,264,822 $(224,242) ------------------------------------------------------------------------ Income tax expense/(benefit) 248,048 (252,543) 737,567 (24,003) Net Income/(Loss) $518,088 $(966,534) $1,527,255 $(200,239) ======================================================================== NORTHEAST INDIANA BANCORP CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2009 2008 2009 2008 ---- ---- ---- ---- Basic Earnings per common share 0.42 (0.79) 1.24 (0.16) Dilutive Earnings per share 0.42 (0.79) 1.24 (0.16) Net interest margin 3.53% 2.88% 3.45% 2.76% Return on average assets 0.82% (1.49%) 0.81% (0.11%) Return on average equity 9.20% (18.00%) 9.17% (1.19%) Efficiency ratio 59.60% 287.92%(2) 59.95% 98.82%(2) Average shares outstanding- primary 1,228,539 1,226,989 1,228,060 1,265,799 Average shares outstanding- diluted 1,228,615 1,226,989 1,228,780 1,265,799 ------------------------------------------------------------------------ Allowance for loan losses: Balance at beginning of period $2,161,415 $2,855,624 $1,750,605 $2,712,378 Charge-offs: One-to-four family 9,695 32,616 203,962 32,616 Commercial real estate - 1,469,710 - 1,469,710 Commercial 59,834 107,041 74,192 291,764 Consumer 26,493 13,283 144,030 25,275 ------------------------------------------------- Gross charge-offs 96,022 1,622,651 422,184 1,819,365 ------------------------------------------------- Recoveries: One-to-four family 625 - 1,755 - Commercial real estate - 226,858 - 226,588 Commercial - 18,130 136,635 150,964 Consumer 6,856 13,243 31,063 40,639 ------------------------------------------------- Gross recoveries 7,481 258,231 169,453 418,191 ------------------------------------------------- Net charge-offs 88,541 1,364,420 252,731 1,401,174 Additions charged to operations 350,000 100,000 925,000 280,000 ------------------------------------------------- Balance at end of period $2,422,874 $1,591,204 $2,422,874 $1,591,204 ================================================= Net loan charge-offs to average loans (1) 0.18% 2.71% 0.17% 0.94% ------------------------------------------------------------------------ Nonperforming assets At Sept. 30, At Sept. 30, At June 30, At Dec. 30, (000's) 2009 2008 2009 2008 Loans: ---- ---- ---- ---- Non-accrual $2,251 $1,887 $2,501 $1,570 Past 90 days or more and still accruing - - - - Troubled debt restructured 3,000 - 1,622 - ------------------------------------------------- Total nonperforming loans 5,251 1,887 4,123 1,570 Real estate owned 1,556 1,242 1,498 1,423 Other repossessed assets 7 7 1 8 ------------------------------------------------- Total nonperforming assets $6,184 $3,136 $5,622 $3,001 ================================================= Nonperforming assets to total assets 2.75% 1.22% 2.28% 1.15% Nonperforming loans to total loans 2.63% 0.93% 2.06% 0.76% Allowance for loan losses to nonperforming loans 46.14% 84.31% 52.41% 111.53% Allowance for loan losses to net loans receivable 1.21% 0.78% 1.09% 0.86% ------------------------------------------------------------------------ At September 30, 2009 2008 ---- ---- Stockholders' equity as a % of total assets 9.25% 8.37% Book value per share $18.60 $17.47 Common shares outstanding- EOP 1,230,670 1,230,670 (1) Ratios for the three-month periods are annualized. (2) Core efficiency ratios were 75.42% for 3 months ended 9/30/08 and 72.88% for 9 months ended 9/30/08 without OTTI
Northeast Indiana Bancorp, Inc.
CONTACT: Randy J. Sizemore, Sr. Vice President, CFO, +1-260-358-4680
Web Site: http://www.firstfedindiana.com/
