SE Financial Corp. (trading symbol: SEFL) (the "Company"), the holding company for St. Edmond's Federal Savings Bank, announced net income of $255.5 thousand for the three months ended April 30, 2010 as compared to $237.9 thousand for the same period last year. For the six months ended April 30, 2010, the Company announced net income of $543.9 thousand compared to $36.1 thousand for the same period last year.
- Total deposits increased $7.5 million for the quarter to $266.5 million at April 30, 2010 from $259.0 million as of January 31, 2010, representing a 11.51% increase on an annualized basis. The increase was comprised of increases in savings, checking and certificate of deposit accounts of $4.6 million, $1.7 million and $2.2 million respectively, offset by a decrease in money market accounts of $1.8 million.
- Despite intense competition in the Greater Philadelphia market, the Bank continues to attract new deposit customers and expand existing relationships while adhering to prudent pricing strategy resulting in a decrease of 14 basis points in the average cost of interest-bearing deposits to 1.79% for the quarter ended April 30, 2010 as compared to 1.93% for the quarter ended January 31, 2010. At April 30, 2010, the Bank's total cost of deposits was 1.76%. This pricing strategy includes aggressive re-pricing of maturing certificates of deposit at lower rates, a decrease in rates paid on certain core deposit products and a focus on the collection of lower costing, service-sensitive, deposit accounts.
- During the quarter, loans receivable increased $1.2 million to $207.2 million at April 30, 2010, as compared to loans receivable of $206.0 million at January 31, 2010. The yield on loans for the quarter ended April 30, 2010 decreased 14 basis points to 5.99% as compared to 6.13% for the quarter ended January 31, 2010.
- The net interest margin was 3.21% for the quarter ended April 30, 2010 versus 3.27% for the quarter ended January 31, 2010.
- The ratio of total non-performing assets to total assets increased to 277 basis points from 218 basis points at January 31, 2010. Real estate owned for the quarter ended April 30, 2010 totaled $593.6 due to the foreclosure of one loan secured by commercial real estate. The property is currently under agreement of sale. Nonaccrual loans as of April 30, 2010 were comprised of 8 single-family mortgage loans totaling $1.3 million, 3 non-owner occupied mixed use mortgage loans totaling $200 thousand, 5 multi-family and commercial real estate mortgage loans totaling $4.8 million and 2 single family residential construction loans totaling $1.7 million.
- The allowance for loan losses to total loans was 128 basis points at April 30, 2010. During the quarter ended April 30, 2010 additional provisions totaling $416.4 thousand were recorded due mainly to loan risk rating downgrades, trends in delinquency, charge-off history and other qualitative factors used to calculate the estimate of the allowance for loan losses. There were charge-offs during the quarter ended April 30, 2010 totaling $330.1 thousand. The allowance represents management's estimate of the amount necessary to cover known and inherent losses in the loan portfolio.
- As of April 30, 2010 the Company's stockholders' equity to assets was 8.01% and the Bank's capital exceeds ratios to be considered "Well Capitalized" as defined by the Office of Thrift Supervision.
- On May 18, 2010 the Board of Directors declared a cash dividend of $.03 per share to stockholders of record as of June 1, 2010.
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SE FINANCIAL CORP. UNAUDITED QUARTER HIGHLIGHTS (Dollars in Thousands) | ||||||||||||||||||||||||||
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QTR | QTR | $ Increase | % Increase | |||||||||||||||||||||||
4/30/2010 | Â | Â | Â | Â | 1/31/2010 | Â | Â | Â | Â | (Decrease) | Â | Â | Â | Â | (Decrease) | |||||||||||
Total Assets | $ | 311,550 | Â | Â | Â | Â | Â | $ | 307,519 | Â | Â | Â | Â | Â | $ | 4,031 | Â | Â | Â | Â | Â | 1.31 | % | |||
Investment Securities | Â | 59,139 | Â | Â | Â | Â | Â | Â | 58,288 | Â | Â | Â | Â | Â | Â | 851 | Â | Â | Â | Â | Â | 1.46 | % | |||
Loans | Â | 207,221 | Â | Â | Â | Â | Â | Â | 205,982 | Â | Â | Â | Â | Â | Â | 1,239 | Â | Â | Â | Â | Â | 0.60 | % | |||
Deposits | Â | 266,496 | Â | Â | Â | Â | Â | Â | 259,046 | Â | Â | Â | Â | Â | Â | 7,450 | Â | Â | Â | Â | Â | 2.88 | % | |||
Borrowings | Â | 19,530 | Â | Â | Â | Â | Â | Â | 23,013 | Â | Â | Â | Â | Â | Â | (3,483 | ) | Â | Â | Â | Â | -15.13 | % | |||
Equity | Â | 24,957 | Â | Â | Â | Â | Â | Â | 24,696 | Â | Â | Â | Â | Â | Â | 261 | Â | Â | Â | Â | Â | 1.06 | % | |||
Interest Income | Â | 3,595 | Â | Â | Â | Â | Â | Â | 3,835 | Â | Â | Â | Â | Â | Â | (240 | ) | Â | Â | Â | Â | -6.26 | % | |||
Interest Expense | Â | 1,326 | Â | Â | Â | Â | Â | Â | 1,450 | Â | Â | Â | Â | Â | Â | (124 | ) | Â | Â | Â | Â | -8.55 | % | |||
Net Interest Income | Â | 2,270 | Â | Â | Â | Â | Â | Â | 2,385 | Â | Â | Â | Â | Â | Â | (115 | ) | Â | Â | Â | Â | -4.82 | % | |||
Provision | Â | 416 | Â | Â | Â | Â | Â | Â | 449 | Â | Â | Â | Â | Â | Â | (33 | ) | Â | Â | Â | Â | -7.35 | % | |||
Noninterest Income | Â | 404 | Â | Â | Â | Â | Â | Â | 312 | Â | Â | Â | Â | Â | Â | 92 | Â | Â | Â | Â | Â | 29.49 | % | |||
Noninterest Expense | Â | 1,890 | Â | Â | Â | Â | Â | Â | 1,813 | Â | Â | Â | Â | Â | Â | 77 | Â | Â | Â | Â | Â | 4.25 | % | |||
Net Income (Loss) | Â | 256 | Â | Â | Â | Â | Â | Â | 288 | Â | Â | Â | Â | Â | Â | (32 | ) | Â | Â | Â | Â | -11.11 | % | |||
Net Interest Margin | Â | 3.21 | % | Â | Â | Â | Â | Â | 3.27 | % | Â | Â | Â | Â | Â | -0.06 | % | Â | Â | Â | Â | -1.83 | % | |||
Yield on Loans | Â | 5.99 | % | Â | Â | Â | Â | Â | 6.13 | % | Â | Â | Â | Â | Â | -0.14 | % | Â | Â | Â | Â | -2.28 | % | |||
Yield on Investments | Â | 4.23 | % | Â | Â | Â | Â | Â | 4.18 | % | Â | Â | Â | Â | Â | 0.05 | % | Â | Â | Â | Â | 1.20 | % | |||
Cost of Deposits | Â | 1.79 | % | Â | Â | Â | Â | Â | 1.93 | % | Â | Â | Â | Â | Â | -0.14 | % | Â | Â | Â | Â | -7.25 | % | |||
Cost of Borrowings | Â | 3.63 | % | Â | Â | Â | Â | Â | 3.61 | % | Â | Â | Â | Â | Â | 0.02 | % | Â | Â | Â | Â | 0.55 | % | |||
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Comparison of the Results of Operations for the Three Months Ended April 30, 2010 and April 30, 2009
For the three-month periods ended April 30, 2010 and 2009, net interest income after provision for loan losses totaled $1.9 million and $1.6 million, respectively. The increase of $245 thousand was due to an increase in the average balance of interest-earning assets of $15.9 million to $292.2 million for the three months ended April 30, 2010 as compared to $276.3 million for the three months ended April 30, 2009 and an increase in the net interest margin of 36 basis points to 3.21% for the three months ended April 30, 2010 from 2.85% for the three months ended April 30, 2009.
The provision for loan losses increased $116.7 thousand to $416.4 thousand for the three months ended April 30, 2010 versus $299.8 thousand for the three months ended April 30, 2009.
Non-interest income was $404.4 thousand for the three months ended April 30, 2010 compared to $488.1 thousand for the three months ended April 30, 2009. The decrease of $83.7 thousand was due mainly to $230 thousand adjustment in the prior year related to the value of pooled trust preferred securities deemed to be other than temporarily impaired offset by increases in non-interest income of $95.3 thousand in gains on sale of securities, $26.3 thousand in service fees on deposit accounts and $25.3 in other income.
Non-interest expense increased $151.1 thousand to $1.9 million for the three months ended April 30, 2010 compared to $1.7 million for the three months ended April 30, 2009. The increase in non-interest expense was due mainly to increases in professional fees, federal deposit insurance premiums and data processing fees offset by a decrease in compensation and employee benefits. The $113.3 thousand increase in professional fees is a result of legal fees incurred in connection with loan workout. The $22.2 thousand increase in federal deposit insurance premiums is a result of the increased premiums.
Comparison of the Results of Operations for the Six Months Ended April 30, 2010 and April 30, 2009
For the six month periods ended April 30, 2010 and 2009, net interest income after provision for loan losses totaled $3.8 million and $3.3 million, respectively. The increase of $487.3 thousand was due to an increase in the average balance of interest-earning assets of $19.8 million to $291.8 million for the six months ended April 30, 2010 as compared to $272.0 million for the six months ended April 30, 2009 and an increase in the net interest margin of 43 basis points to 3.22% for the six months ended April 30, 2010 from 2.79% for the six months ended April 30, 2009.
The provision for loan losses increased $395.9 thousand to $865.4 thousand for the six months ended April 30, 2010 versus $469.5 thousand for the six months ended April 30, 2009.
Non-interest income was $716.1 thousand for the six months ended April 30, 2010 compared to $99.7 thousand for the six months ended April 30, 2009. The increase of $616.4 thousand was due to increases in gains on sale of investment securities available for sale and service fees on deposit accounts in the amount of $172.4 thousand and $40.3 thousand respectively in the current year and to other than temporary impairment charges on pooled trust preferred securities posted in the prior year of $370 thousand.
Non-interest expense increased $326.1 thousand to $3.7 million for the six months ended April 30, 2010 compared to $3.4 million for the six months ended April 30, 2009. The increase in non-interest expense was due mainly to increases in professional fees and federal deposit insurance premiums. The $168.9 thousand increase in professional fees is a result of legal fees incurred in connection with loan workout. The $118.4 thousand increase in federal deposit insurance premiums is a result of the increased premiums.
The increase in income tax expense of approximately $270.0 thousand for the six months ended April 30, 2010 compared to the same period last year is due to the increase in pretaxable income.
Comparison of Financial Condition at April 30, 2010 and October 31, 2009
Total assets decreased $116.1 thousand to $311.6 million at April 30, 2010 as compared to $311.7 million at October 31, 2009. Cash and cash equivalents increased $2.7 million to $27.5 million at April 30, 2010 from $24.8 million at October 31, 2009. Loans receivable decreased $188.7 thousand to $207.2 million at April 30, 2010 from $207.4 million at October 31, 2009. Deposits increased $9.6 million to $266.5 million at April 30, 2010 from $256.9 million at October 31, 2009. Borrowed money decreased $9.3 million to $19.5 million at April 30, 2010 from $28.9 million at October 31, 2009 due to maturities of Federal Home Loan Bank Advances. Stockholders' equity increased $217.6 thousand to $24.9 million at April 30, 2010 from $24.7 million at October 31, 2009 due mainly to net income of $543.9 offset by dividends paid and a change in accumulated other comprehensive income (loss).
Company Information
SE Financial Corp. is the holding company for St. Edmond's Federal Savings Bank, a federally chartered stock savings institution with six Neighborhood Banking Offices serving South Philadelphia, Roxborough, Ardmore and Drexel Hill, Pennsylvania and Deptford and Sewell, New Jersey. SE Financial Corp. is incorporated under the laws of the Commonwealth of Pennsylvania and its executive offices are located at 1901-03 East Passyunk Avenue, Philadelphia, Pennsylvania 19148. As of April 30, 2010, there were issued and outstanding 2,179,814 shares of common stock, par value $0.10 per share of SE Financial Corp. Registrar and Transfer Company serves as the transfer agent for SE Financial Corp. and its address is 10 Commerce Drive, Cranford, New Jersey 07016.
Senior Management: Pamela M. Cyr, President and CEO, J. Christopher Jacobsen, EVP and Chief Operating Officer, Charles F. Miller, EVP and Chief Lending and Credit Officer, and Caroline H. Doyle, Chief Financial Officer.
Board of Directors: Marcy C. Panzer (Chairman), Samuel Barsky (Secretary), Charles M. Cahn, Andrew A. Hines, Megan L. Mahoney, J. W. Parker, Jr., CPA, William F. Saldutti, III, Susanne Spinell Shuster, CPA.
Forward-Looking Statements Disclaimer
This news release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Any statement that is not a historical fact is a forward-looking statement. Such forward-looking statements are subject to risk and uncertainties, which could cause actual results to differ materially from those currently anticipated due to a number of factors.
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SE FINANCIAL CORP. | |||||||||||||
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Selected Income Statement Data (Unaudited) | |||||||||||||
(Dollars in thousands except per share data) | Three Months Ended April 30, | Six Months Ended April 30, | |||||||||||
2010 | 2009 | 2010 | 2009 | ||||||||||
Interest income | $ | 3,595 | $ | 3,849 | $ | 7,430 | $ | 7,748 | |||||
Interest expense | Â | 1,326 | Â | 1,942 | Â | 2,775 | Â | 3,976 | |||||
Net interest income | 2,269 | 1,907 | 4,655 | 3,772 | |||||||||
Provision for loan losses | Â | 416 | Â | 300 | Â | 865 | Â | 469 | |||||
Net interest income after provision for loan losses | 1,853 | 1,607 | 3,790 | 3,303 | |||||||||
Noninterest income | 404 | 488 | 716 | 99 | |||||||||
Noninterest expense | Â | 1,890 | Â | 1,739 | Â | 3,703 | Â | 3,377 | |||||
Income before taxes | 367 | 356 | 803 | 25 | |||||||||
Income tax (benefit) expense | Â | 112 | Â | 119 | Â | 259 | Â | (11) | |||||
Net income | $ | 255 | $ | 237 | $ | 544 | $ | 36 | |||||
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Weighted average shares outstanding- basic and diluted (1) | 1,894,803 | 1,873,004 | 1,892,629 | 1,874,406 | |||||||||
Income per share - basic and diluted (1) | Â | $0.13 | Â | $0.13 | Â | $0.29 | Â | $0.02 | |||||
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Performance Ratios (Unaudited) | Three Months Ended April 30, | Six Months Ended April 30, | |||||||||||
2010 | 2009 | 2010 | 2009 | ||||||||||
Return on average assets (2) | 0.33% | 0.33% | 0.35% | 0.03% | |||||||||
Return on average equity (2) | 4.08% | 3.96% | 4.35% | 0.30% | |||||||||
Net interest margin on average interest earning assets (2)(3) | 3.21% | 2.85% | 3.22% | 2.79% | |||||||||
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Selected Balance Sheet Data (Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands except per share data) | April 30, | October 31, | |||||||||||||||||||||||||||||||||||||||||||||
 |  | 2010 | 2009 | ||||||||||||||||||||||||||||||||||||||||||||
Assets | $ | 311,551 | $ | 311,667 | |||||||||||||||||||||||||||||||||||||||||||
Loan receivable, net | 207,221 | 207,410 | |||||||||||||||||||||||||||||||||||||||||||||
Cash and cash equivalents | 27,468 | 24,812 | |||||||||||||||||||||||||||||||||||||||||||||
Investment securities | 59,139 | 63,355 | |||||||||||||||||||||||||||||||||||||||||||||
Deposits | 266,496 | 256,905 | |||||||||||||||||||||||||||||||||||||||||||||
FHLB borrowings | 19,530 | 28,872 | |||||||||||||||||||||||||||||||||||||||||||||
Total stockholders' equity | 24,957 | 24,740 | |||||||||||||||||||||||||||||||||||||||||||||
Ending shares outstanding (1) | 1,898,588 | 1,884,451 | |||||||||||||||||||||||||||||||||||||||||||||
Book value per share (1) | 13.15 | 13.09 | |||||||||||||||||||||||||||||||||||||||||||||
Stockholders' equity to total assets | 8.01% | 7.93% | |||||||||||||||||||||||||||||||||||||||||||||
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Asset Quality (Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | April 30, | October 31, | |||||||||||||||||||||||||||||||||||||||||||||
2010 | 2009 | ||||||||||||||||||||||||||||||||||||||||||||||
Non-performing assets (4) | $ | 8,645 | $ | 4,406 | |||||||||||||||||||||||||||||||||||||||||||
Allowance for losses | 2,651 | 2,116 | |||||||||||||||||||||||||||||||||||||||||||||
Non-performing assets to total assets | 2.77% | 1.42% | |||||||||||||||||||||||||||||||||||||||||||||
Allowance for losses to total loans | 1.28% | 1.02% | |||||||||||||||||||||||||||||||||||||||||||||
Allowance for losses to non-performing assets | 30.67% | 48.03% | |||||||||||||||||||||||||||||||||||||||||||||
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(1) | Â | Shares outstanding does not include unreleased ESOP shares, unearned nonvested RSP shares, or shares held in the Stock Compensation Trust for purposes of the weighted average shares outstanding calculation and the ending shares outstanding calculation. |
(2) | Annualized for the three and six months ended April 30, 2010 and 2009. | |
(3) | The yield on municipal securities has been adjusted to a tax-equivalent basis. | |
(4) | Non-performing assets include non-accrual loans and real estate owned. |
Contacts:
SE Financial Corp.
Pamela M. Cyr
President
and CEO
215-468-1700