NEWTOWN, Pa., Jan. 23, 2008 (PRIME NEWSWIRE) -- TF Financial Corporation (Nasdaq:THRD) today reported net income of $4,845,000 ($1.78 per diluted share) for 2007, compared with $5,514,000 ($2.03 per diluted share) for 2006. Net income for the three month period ended December 31, 2007 was $1,222,000 ($0.45 per diluted share) compared with $1,455,000 ($0.53 per diluted share) during the comparable period of 2006. The Company also announced that its Board of Directors declared a quarterly dividend of $0.20 per share, payable February 15, 2008 to shareholders of record on February 8, 2008.
Highlights for 2007 included:
* Interest income increased by a modest 0.3% or $109,000 during
2007. Net loans outstanding increased by $33.5 million or 6.9% to
$518.1 million because of the Company's highly successful new
loan production efforts during the year. Loan yields increased by
2 basis points to 6.46% despite a 100 basis point decrease in
the prime rate during the year, which resulted in lower interest
yields on the Company's prime rate-based construction,
commercial, and home equity loans.
* Interest expense increased by 15.7% or $2.5 million. Deposits
decreased by $5.7 million or 1.2% to $472.4 million. The average
cost of deposits increased by 55 basis points during 2007, mainly
due to a shift in the Company's deposit mix away from lower cost
savings and passbook accounts and toward higher cost money market
accounts and other products. In addition, market interest rates
on certificates of deposit especially in the later part of the
year remained stubbornly high despite continuously lower U.S.
Treasury interest rates throughout the year.
* Non-performing assets were 0.76% of total assets at year end, and
net charge-off's during the year were only $23,000. The allowance
for loan losses was over $2.8 million at year end and there was
no loan loss provision during the year. The Company was
unaffected by subprime loan issues because the Company did not
engage in subprime lending and did not purchase securities backed
by subprime loans.
* Return on assets and return on equity were 0.73% and 7.24%,
respectively, during the year. In addition, the Bank continued to
perform better than the majority of its peer group.
* Non-interest income increased by $926,000 during 2007 when
compared with 2006 and included a $777,000 non-recurring
settlement payment received during the first quarter, related to
a lease fraud which occurred during 2003. Non-interest expense
decreased by $266,000 and included a $305,000 non-recurring
expense associated with the bankruptcy of a loan subservicer of
the Company. Without these non-recurring items, net non-interest
expense decreased by $720,000 as the Company continued to
diversify and increase its non-interest income sources, and
worked diligently to control and reduce operating expenses.
* Dividends for the year were $0.80 per share, up 5.3% from the
$0.76 paid during 2006.
Commenting on the performance of the company, President Kent C. Lufkin stated, "Although we strive to do even better, we believe the Company has performed well over the last quarter and year. This is especially gratifying in light of the ongoing economic uncertainty, the shrinking net interest margins due to extremely aggressive competitor deposit gathering strategies, and the ramifications of the subprime mortgage problems that have affected many other financial institutions."
TF Financial Corporation is a holding company whose principal subsidiary is Third Federal Bank, which operates 15 full service retail and commercial banking offices in Philadelphia and Bucks County, Pennsylvania and in Mercer County, New Jersey. In addition, the Bank's website can be found at www.thirdfedbank.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.
TF FINANCIAL CORPORATION
UNAUDITED FINANCIAL INFORMATION
(dollars in thousands except per share data)
THREE MONTHS
------------ INC
12/31/2007 12/31/2006 (DEC)
---------- ---------- -----
EARNINGS SUMMARY
Interest income $ 9,780 $ 9,678 1.1%
Interest expense 4,933 4,224 16.8%
Net interest income 4,847 5,454 -11.1%
Loan loss provision 0 0 0.0%
Non-interest income 772 691 11.7%
Non-interest expense 3,987 4,127 -3.4%
Income taxes 410 563 -27.2%
Net income $ 1,222 $ 1,455 -16.0%
PER SHARE INFORMATION
Earnings per share, basic $ 0.45 $ 0.54 -16.7%
Earnings per share, diluted $ 0.45 $ 0.53 -15.1%
Dividends paid $ 0.20 $ 0.19 5.3%
FINANCIAL RATIOS
Annualized return on average assets 0.71% 0.88% -19.3%
Annualized return on average equity 7.15% 8.80% -18.8%
Efficiency ratio 70.96% 67.16% 5.7%
AVERAGE BALANCES
Loans $ 511,635 $ 496,343 3.1%
Mortgage-backed securities 92,149 77,725 18.6%
Investment securities 39,968 42,628 -6.2%
Other interest-earning assets 765 2,198 -65.2%
Total earning assets 644,517 618,894 4.1%
Non-earning assets 37,361 35,639 4.8%
Total assets 681,878 654,533 4.2%
Deposits 472,875 475,707 -0.6%
FHLB advances 132,643 105,727 25.5%
Total interest bearing liabilities 605,518 581,434 4.1%
Non-interest bearing liabilities 8,573 7,515 14.1%
Stockholders' equity 67,787 65,584 3.4%
Total liabilities & stockholders'
equity $ 681,878 $ 654,533 4.2%
SPREAD AND MARGIN ANALYSIS
Average yield on:
Loans 6.39% 6.60%
Mortgage-backed securities 4.71% 4.50%
Investment securities 5.48% 5.81%
Other interest-earning assets 4.15% 5.23%
Average cost of:
Deposits 2.95% 2.64%
FHLB advances 4.25% 3.97%
Interest rate spread 2.86% 3.40%
Net interest margin 3.06% 3.57%
NON-INTEREST INCOME DETAIL
Service fees, charges and other $ 574 $ 515 11.5%
Bank-owned life insurance 153 128 19.5%
Gain on sale of loans 45 48 -6.3%
NON-INTEREST EXPENSE DETAIL
Salaries and benefits 2,444 2,621 -6.8%
Occupancy 679 664 2.3%
Professional fees 195 264 -26.1%
Advertising 93 (28) -432.1%
Other 576 606 -5.0%
TF FINANCIAL CORPORATION
UNAUDITED FINANCIAL INFORMATION
(dollars in thousands except per share data)
TWELVE MONTHS
------------- INC
12/31/2007 12/31/2006 (DEC)
---------- ---------- -----
EARNINGS SUMMARY
Interest income $ 38,128 $ 38,019 0.3%
Interest expense 18,355 15,861 15.7%
Net interest income 19,773 22,158 -10.8%
Loan loss provision 0 150 -100.0%
Non-interest income 3,736 2,810 33.0%
Non-interest expense 16,902 17,168 -1.5%
Income taxes 1,762 2,136 -17.5%
Net income $ 4,845 $ 5,514 -12.1%
PER SHARE INFORMATION
Earnings per share, basic $ 1.78 $ 2.04 -12.7%
Earnings per share, diluted $ 1.78 $ 2.03 -12.3%
Dividends paid $ 0.80 $ 0.76 5.3%
FINANCIAL RATIOS
Annualized return on average assets 0.73% 0.83% -12.0%
Annualized return on average equity 7.24% 8.68% -16.6%
Efficiency ratio 71.90% 69.18% 3.9%
AVERAGE BALANCES
Loans $ 501,112 $ 502,048 -0.2%
Mortgage-backed securities 86,816 81,750 6.2%
Investment securities 38,666 41,984 -7.9%
Other interest-earning assets 2,180 1,653 31.9%
Total earning assets 628,774 627,435 0.2%
Non-earning assets 35,937 35,050 2.5%
Total assets 664,711 662,485 0.3%
Deposits 477,299 468,933 1.8%
FHLB advances 112,277 122,671 -8.5%
Total interest bearing liabilities 589,576 591,604 -0.3%
Non-interest bearing liabilities 8,189 7,332 11.7%
Stockholders' equity 66,946 63,549 5.3%
Total liabilities & stockholders'
equity $ 664,711 $ 662,485 0.3%
SPREAD AND MARGIN ANALYSIS
Average yield on:
Loans 6.46% 6.44%
Mortgage-backed securities 4.72% 4.55%
Investment securities 5.55% 5.47%
Other interest-earning assets 4.83% 5.69%
Average cost of:
Deposits 2.88% 2.33%
FHLB advances 4.17% 4.03%
Interest rate spread 3.03% 3.45%
Net interest margin 3.23% 3.60%
NON-INTEREST INCOME DETAIL
Service fees, charges and other $ 2,915 $ 2,121 37.4%
Bank-owned life insurance 607 502 20.9%
Gain on sale of loans 214 238 -10.1%
Gain (loss) on sales of securities 0 (51) -100.0%
NON-INTEREST EXPENSE DETAIL
Salaries and benefits 10,390 10,636 -2.3%
Occupancy 2,812 2,834 -0.8%
Professional fees 698 739 -5.5%
Advertising 419 500 -16.2%
Other 2,583 2,459 5.0%
TF FINANCIAL CORPORATION
UNAUDITED FINANCIAL INFORMATION
(dollars in thousands except per share data)
PERIOD ENDING
------------- INC
12/31/2007 12/31/2006 (DEC)
---------- ---------- -----
DEPOSIT INFORMATION
Non-interest checking $ 35,904 $ 36,991 -2.9%
Interest checking 46,543 51,272 -9.2%
Money market 79,267 62,914 26.0%
Savings 130,423 131,359 -0.7%
CD's, retail 180,257 183,847 -2.0%
CD's, broker 0 11,704 -100.0%
OTHER INFORMATION
Per Share
Book value (a) $ 25.48 $ 24.29
Tangible book value (a) $ 23.86 $ 22.68
Closing market price $ 24.64 $ 31.00
Balance sheet
Loans, net $ 518,067 $ 484,539 6.9%
Cash and cash equivalents 5,680 12,364 -54.1%
Mortgage-backed securities 104,338 82,035 27.2%
Investment securities 41,389 42,371 -2.3%
Total assets 702,000 652,603 7.6%
Total deposits 472,394 478,087 -1.2%
FHLB advances and other 153,221 101,701 50.7%
Stockholders' equity 68,059 65,639 3.7%
Asset Quality
Non-performing loans 5,358 2,110 153.9%
Loan loss reserves 2,842 2,865 -0.8%
Reserves to gross loans 0.55% 0.59% -6.8%
Non-performing loans to gross loans 1.03% 0.43% 139.5%
Non-performing loans to total assets 0.76% 0.32% 137.5%
Foreclosed property 0 0 0.0%
Foreclosed property to total assets 0.00% 0.00% 0.0%
Non-performing assets to total assets 0.76% 0.32% 137.5%
Statistical
Shares outstanding (000's) (a) 2,671 2,703
Number of branch offices 15 15
Full time equivalent employees 181 189
(a) Excludes 159,000 and 171,000 unallocated employee stock
ownership plan shares at December 31, 2007 and 2006,
respectively.