Peoples Bancorp Reports 32% Quarterly Net Income Increase

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| Source: Peoples Bancorp

AUBURN, Ind., April 17, 2014 (GLOBE NEWSWIRE) -- Peoples Bancorp (OTCBB:PBNI) reported net income for the second quarter ended March 31, 2014, of $745,652 versus the same quarter last year income of $565,042. Second quarter earnings per share were $0.32 compared to $0.24 per share for the same period one year ago, an increase of 33%.

Maurice F. Winkler, President of Peoples Bancorp, indicated "Strong growth in net interest margin has had a positive impact on earnings results for both the just completed quarter and on a year to date basis. Net interest margin is up 33% on a quarter over quarter basis, as well as year to date. Reduced prepayment speeds on mortgage backed securities within the Company's investment portfolio have been the primary factor in contributing to the positive performance. The Company is also still seeing a reduction in its cost of funds. Non-interest income increased 12.4%, mostly because of gains taken on the sale of investment securities along with an increase in fiduciary trust income. This helped to offset an increase in the provision for loan losses, as well as, a 2.4% increase in non-interest expenses compared to the same quarter a year ago.

On a year over year basis, we have been able to keep non-interest expenses relatively flat. Year to date, net interest income has grown 10%. Loan balances have now grown by $5.3 million during the first six months of the fiscal year, while our delinquency ratios continue to decrease. We feel like the Company is positioned to benefit from improvements in the local economy."

Peoples reported assets on March 31, 2014, of $468,434,171, an increase of $17.7 million from September 30, 2013. Peoples' deposit balances increased during the quarter ended March 31, 2014 by $746,419 to $354,759,605.

Peoples had 2,313,788 shares of stock outstanding as of March 31, 2014, and the closing price of Peoples Bancorp stock as of April 15, 2014, was $24.00 per share as listed on the OTCQB System under the symbol PBNI. At March 31, 2014, Peoples had stockholders equity of $59,423,579, a capital to assets ratio of 12.64%, and a book value of $25.68.

Peoples Bancorp, through its subsidiary, Peoples Federal Savings Bank, operates sixteen full-service offices located in Auburn, Avilla, Garrett, Howe, Kendallville, Lagrange, Middlebury, Topeka, Waterloo, Woodburn, and two in Columbia City, Indiana; and Three Rivers (two offices), Schoolcraft, and Union in Michigan.

SELECTED CONSOLIDATED FINANCIAL DATA OF PEOPLES BANCORP
         
  March 31, September 30, March 31,  
  2014 2013 2013  
Balance Sheet Data:        
Total assets $468,434,171 $450,760,405 $470,991,440  
Loans receivable including loans held for sale, net 234,114,629 228,360,874 228,378,311  
Investment securities 184,236,308 180,938,743 193,608,116  
Other interest earning assets 19,512,556 11,614,650 17,138,844  
Deposits 354,759,605 349,677,821 361,441,818  
Borrowed Funds 50,992,239 40,061,234 42,632,200  
Stockholder's equity 59,423,579 58,282,473 62,403,319  
Non-performing loans and REO 830,000 1,066,000 1,238,000  
Equity to assets ratio 12.64% 12.88% 13.25%  
Book value per share $25.68 $25.19 $26.32  
         
  Three Months Ended Six Months Ended
  March 31, March 31,
  2014 2013 2014 2013
Operating Data:        
Interest income $3,932,761 $3,792,016 $7,826,358 $7,818,359
Interest expense 761,547 968,831 1,526,627 2,097,652
Net interest income $3,171,214 $2,823,185 $6,299,731 $5,720,707
Provision for losses on loans 130,000 60,000 170,000 150,000
Net interest income after provision for losses on loans $3,041,214 $2,763,185 $6,129,731 $5,570,707
Non-Interest income 867,633 771,789 1,558,331 1,636,600
Non-Interest expenses 3,067,002 2,995,057 5,986,693 5,960,051
Income before income taxes 841,845 539,917 1,701,369 1,247,256
Income tax expense 96,193 (25,125) 195,705 4,304
Net income $745,652 $565,042 $1,505,664 $1,242,952
         
Basic income per common share $0.32 $0.24 $0.65 $0.52
Diluted income per common share $0.32 $0.24 $0.65 $0.52
Dividends per common share $0.20 $0.20 $0.40 $0.40
         
Other Data:        
Average yield on all interest-earning assets 3.64% 3.51% 3.62% 3.53%
Average cost of all interest-bearing liabilities 0.81% 1.04% 0.81% 1.10%
Interest rate spread 2.83% 2.47% 2.81% 2.43%
         
Net interest margin 2.94% 2.61% 2.92% 2.59%
         
Return on assets (net income divided by average total assets) 0.64% 0.48% 0.65% 0.52%
Return on equity (net income divided by average total equity) 5.02% 3.57% 5.08% 3.91%
Dividend payout ratio (dividends per common share divided by net income per common share) 62.50% 83.33% 61.54% 76.92%
Maurice F. Winkler, III
Phone: 260-925-2500