HELENA, Mont., July 21, 2005 (PRIMEZONE) -- Eagle Bancorp ("Eagle") (OTCBB:EBMT), the stock holding company of American Federal Savings Bank (the "Bank"), reported net income of $1,743,000, or $1.55 per share ($1.45 per share diluted), for the year ended June 30, 2005, and announced an increased cash dividend of $0.20 per share. These earnings represent a decrease of $335,000, or 16.1%, compared to $2,078,000 for the year ended June 30, 2004. Earnings for the quarter ended June 30, 2005 were $370,000, or $0.34 per share, an increase of 11.1% compared to $333,000 for the quarter ended June 30, 2004, but a decline of 16.9% from the $445,000 earned in the prior quarter ended March 31, 2005.
Eagle also announced that the Board of Directors approved a repurchase program for the company's shares. The Board's action permits Eagle to acquire up to 28,750 shares of its common stock subject to market conditions. This represents approximately 6% of the outstanding common stock currently held by the public. Repurchases are authorized to be made from time to time in open market transactions as, in the opinion of management, market conditions warrant. The repurchased shares will be held as treasury stock and will be held for general corporate purposes and/or issuance pursuant to Eagle's benefit plans. The repurchase plan also allows for the possibility of unsolicited negotiated transactions or other types of purchases. No shares will be purchased from directors or officers of Eagle.
Eagle's Board of Directors declared a quarterly cash dividend of $0.20 per share for the fourth quarter of Eagle's fiscal year. This represents an increase of $0.02 per share, or 11.1%, over the previous quarter's dividend. The dividend is payable August 26, 2005 to shareholders of record at the close of business on August 5, 2005.
The decrease in net income for the year ended June 30, 2005 was the result of a decrease in non-interest income of $1.375 million, offset by an increase in net interest income of $400,000 and a decrease in noninterest expense of $19,000. Eagle's tax provision was $418,000 lower in 2005. Eagle's return on assets was 0.85% and its return on equity was 7.53%, compared with 1.02% and 8.75%, respectively, for the year ended June 30, 2004. Eagle also incurred an extraordinary loss of $203,000 (net of tax benefit of $127,000) in the fourth quarter of 2004. This was the result of prepayment penalties on Federal Home Loan Bank (FHLB) borrowings, which were paid off prior to maturity.
The decrease in noninterest income for the year was due primarily to two factors: the decline in net gain on sale of loans and the larger increases in the value of Eagle's mortgage servicing rights recorded in 2004. Net gain on sale of loans was $694,000 lower in 2005, due to lower mortgage origination volumes. The mortgage servicing fees (where changes in the valuation of mortgage servicing rights are recorded) were $657,000 lower in 2005.
The increase in net income of $37,000 for the fourth quarter was the result of an increase in net interest income of $120,000 offset by a decrease in noninterest income of $334,000 and an increase in noninterest expense of $53,000. Eagle's tax provision was $101,000 lower in the current quarter. As mentioned earlier, in the fourth quarter of 2004 Eagle incurred an extraordinary loss of $203,000 (net of tax benefit). Eagle's annualized return on assets was 0.73% and its annualized return on equity was 6.76%, compared with 0.65% and 5.42%, respectively, for the same quarter in 2004.
Total interest and dividend income increased $87,000 to $2,302,000 for the quarter ended June 30, 2005 from $2,215,000 for the quarter ended June 30, 2004. This was due to an increase in interest and fees on loans of $174,000. This was partially offset by a decrease in interest on securities available-for-sale of $51,000. Total interest expense decreased $33,000 to $674,000 for the quarter ended June 30, 2005 from $707,000 for the quarter ended June 30, 2004. Interest on advances decreased $85,000 and interest on deposits increased $52,000.
Total assets increased $3.4 million, or 1.7%, to $206.4 million at June 30, 2005 from $203.0 million at June 30, 2004. Loans receivable increased $14.4 million, or 15.6%, to $106.8 million from $92.4 million. Investment securities available-for-sale decreased $13.3 million, or 15.0%, to $75.2 million from $88.5 million. Deposits increased $2.4 million, or 1.4%, to $172.5 million from $170.1 million. Advances from the Federal Home Loan Bank increased $2.4 million, or 32.0%, to $9.9 million from $7.5 million. Total stockholders' equity decreased $1.8 million, or 7.5%, to $22.2 million at June 30, 2005 from $24.0 million at June 30, 2004. This was the result of $3.9 million in treasury stock purchased during the period, net income for the period of $1.743 million, dividends paid, and a decrease in accumulated other comprehensive loss of $558,000, mainly due to a reduction in net unrealized loss on securities available-for-sale.
"We are pleased that net interest income, our main component of core earnings, has increased over last year, at a time when many financial institutions have been faced with shrinking margins. We are also pleased to again increase the dividend to our stockholders," said President and CEO, Larry Dreyer.
American Federal Savings Bank was formed in 1922 and is headquartered in Helena, Montana. It has additional branches in Butte, Bozeman and Townsend. Eagle's common stock trades on the OTC Bulletin Board under the symbol "EBMT." Eagle is a subsidiary of Eagle Financial MHC, a federal mutual holding company formed in 2000, which owns approximately 53% of Eagle Bancorp's common stock.
This release may contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and is including this statement for purposes of these safe harbor provisions.
Financial highlights for Eagle Bancorp follow:
EAGLE BANCORP AND SUBSIDIARY (consolidated)
June 30, 2005 June 30, 2004
(Unaudited) (Audited)
----------- -----------
ASSETS
Cash and due from banks 3,122,459 3,587,145
Interest-bearing deposits with banks 1,843,976 759,621
Investment securities available-for-sale,
at market value 75,226,539 88,547,458
Investment securities held-to-maturity,
at cost 1,200,971 1,565,692
Federal Home Loan Bank stock, at cost 1,315,400 1,672,200
Mortgage loans held-for-sale 2,148,327 1,436,747
Loans receivable, net of deferred loan
fee and allowance for loan losses 106,839,159 92,456,589
Accrued interest and
dividends receivable 1,101,729 1,079,815
Mortgage servicing rights, net 1,857,154 2,003,258
Property and equipment, net 6,241,918 6,557,883
Cash surrender value of life insurance 5,049,117 2,476,842
Real estate acquired in settlement of
loans, net of allowance for losses 0 0
Other assets 467,095 870,001
----------- -----------
Total assets 206,413,844 203,013,251
=========== ===========
LIABILITIES
Deposit accounts:
Noninterest bearing 11,659,648 9,267,458
Interest bearing 160,836,785 160,801,422
Advances from Federal Home Loan Bank 9,885,185 7,450,000
Accrued expenses and other liabilities 1,767,122 1,469,832
----------- -----------
Total liabilities 184,148,740 178,988,712
EQUITY
Preferred stock (no par value, 1,000,000
shares authorized, none issued
or outstanding)
Common stock (par value $0.01 per share;
9,000,000 shares authorized; 1,223,572
shares issued; 1,103,972 and 1,212,372
shares outstanding at June 30, 2005
and June 30, 2004, respectively) 12,236 12,236
Additional paid-in capital 4,187,742 4,072,947
Unallocated common stock held by employee
stock ownership plan ("ESOP") (165,648) (202,448)
Treasury stock, at cost (119,600 and
11,200 shares at June 30, 2005 and
June 30, 2004, respectively) (4,047,890) (198,665)
Retained earnings 22,629,987 21,250,088
Accumulated other comprehensive
(loss) income (351,323) (909,619)
----------- -----------
Total equity 22,265,104 24,024,539
Total liabilities and equity 206,413,844 203,013,251
=========== ===========
EAGLE BANCORP (consolidated)
Three Months Ended Twelve Months Ended
June 30, (unaudited) June 30,
--------------------- ---------------------
2005 2004 2005 2004
(unaudited) (audited)
--------- --------- --------- ---------
Interest and
Dividend Income:
Interest and fees on
loans 1,619,382 1,445,303 6,117,299 6,266,332
Interest on deposits
with banks 5,022 12,015 34,180 49,054
FHLB Stock dividends (7,350) 16,547 19,865 77,600
Securities
available-for-sale 669,846 720,970 2,807,185 2,789,898
Securities
held-to-maturity 14,700 19,666 64,653 90,839
--------- --------- --------- ---------
Total interest and
dividend income 2,301,600 2,214,501 9,043,182 9,273,723
--------- --------- --------- ---------
Interest Expense:
Deposits 630,770 578,384 2,394,481 2,631,139
FHLB Advances 43,759 128,993 168,339 562,466
--------- --------- --------- ---------
Total interest
expense 674,529 707,377 2,562,820 3,193,605
--------- --------- --------- ---------
Net Interest Income 1,627,071 1,507,124 6,480,362 6,080,118
Loan loss provision 0 0 0 0
--------- --------- --------- ---------
Net interest income
after loan
loss provision 1,627,071 1,507,124 6,480,362 6,080,118
--------- --------- --------- ---------
Noninterest income:
Net gain on sale
of loans 97,317 133,710 441,603 1,135,693
Demand deposit service
charges 137,989 151,808 548,638 627,404
Mortgage loan
servicing fees 90,503 360,707 584,002 1,240,722
Net gain (loss)
on sale of available
-for-sale securities (5,415) 60,043 3,984 72,415
Other 135,331 83,141 480,189 357,545
--------- --------- --------- ---------
Total noninterest
income 455,725 789,409 2,058,416 3,433,779
--------- --------- --------- ---------
Noninterest expense:
Salaries and
employee benefits 827,949 794,691 3,312,335 3,155,219
Occupancy expenses 136,223 125,373 514,433 490,299
Furniture and
equipment
depreciation 77,513 75,263 312,382 256,060
In-house computer
expense 66,047 52,578 261,515 231,969
Advertising expense 58,390 54,504 189,520 161,447
Amortization of mtg
servicing fees 103,753 121,965 379,982 628,526
Federal insurance
premiums 5,956 6,534 24,427 25,935
Postage 25,285 26,894 101,612 120,219
Legal, accounting, and
examination fees 36,565 41,460 156,518 158,828
Consulting fees 13,253 8,045 50,667 20,585
ATM processing 12,922 12,023 48,664 51,007
Other 200,048 191,655 828,362 898,986
--------- --------- --------- ---------
Total noninterest
expense 1,563,904 1,510,985 6,180,417 6,199,080
--------- --------- --------- ---------
Income before
provision for
income taxes 518,892 785,548 2,358,361 3,314,817
--------- --------- --------- ---------
Provision for
income taxes 148,538 249,515 615,094 1,033,070
--------- --------- --------- ---------
Income before
extraordinary item 370,354 536,033 1,743,267 2,281,747
--------- --------- --------- ---------
Extraordinary
item-extinguishment
of debt (net of tax
benefit of $127,000) 0 (203,378) 0 (203,378)
Net income 370,354 332,655 1,743,267 2,078,369
========= ========= ========= =========
Earnings per share 0.34 0.28 1.55 1.76
========= ========= ========= =========
Diluted earnings
per share 0.31 0.28 1.45 1.74
========= ========= ========= =========
Weighted average
shares outstanding
(basic eps) 1,082,512 1,187,521 1,126,552 1,183,848
========= ========= ========= =========
Weighted average
shares outstanding
(diluted eps) 1,202,112 1,197,512 1,200,386 1,195,786
========= ========= ========= =========