MILLINGTON, N.J., Feb. 12, 2016 (GLOBE NEWSWIRE) -- MSB Financial Corp. (NASDAQ:MSBF) (the “Company”) parent company of Millington Bank, reported today the results of its operations for the three and twelve months ended December 31, 2015. The results of operations reflect the results of operations of MSB Financial Corp., a federal corporation (“Old MSB”) which was merged with and into the Company on July 16, 2015 upon completion of the second-step conversion transaction.
The Company reported net income of $2,000 for the three months ended December 31, 2015, compared to a net loss of $9,000 for the three months ended December 31, 2014. Net income for the twelve months ended December 31, 2015 was $443,000 compared to net income of $707,000 for the twelve months ended December 31, 2014. Net income for the quarter and the full year 2015 reflect the impact of $457,000 of charges related to the conversion from the Company’s existing core data processor as previously disclosed. In addition, the Company recorded expense of approximately $60,000 related to the conversion from its current website provider.
Net income per diluted common share was zero for both the three months ended December 31, 2015 and December 31, 2014. Net income per diluted common share was $0.08 for the twelve months ended December 31, 2015 compared to $0.13 for the twelve months ended December 31, 2014.
Total assets were $375.7 million at December 31, 2015, compared to $340.3 million at December 31, 2014, an increase of $35.4 million or 10.4%. On July 16, 2015, the Company sold 3,766,592 shares of its common stock (including 150,663 shares sold to the Bank’s employee stock ownership plan) at $10.00 per share, for gross proceeds of approximately $37.7 million. In addition, 2,187,242 shares were issued to former holders of the common stock of Old MSB (other than the MHC) in exchange for such shares at a per share exchange ratio of 1.1397 with cash paid in lieu of fractional shares. During 2015, the Company experienced growth of $30.9 million or 13.3%, in loans receivable, net. Commercial and multi-family real estate loans had the most growth during 2015 as the Company continues to diversify its loan portfolio.
The following table summarizes loan balances and composition at December 31, 2015 and 2014:
| At | At | ||||||||||
| December 31, | December 31, | ||||||||||
| (In thousands) | 2015 | 2014 | |||||||||
| Residential mortgage: | |||||||||||
| One-to-four family | $ | 154,624 | 57.1 | % | $ | 144,966 | 61.2 | % | |||
| Home equity | 35,002 | 12.9 | 36,847 | 15.6 | |||||||
| Total residential mortgage | 189,626 | 70.0 | 181,813 | 76.7 | |||||||
| Commercial and multi-family real estate | 59,642 | 22.0 | 31,637 | 13.4 | |||||||
| Construction | 10,895 | 4.0 | 12,651 | 5.3 | |||||||
| Commercial and industrial | 10,275 | 3.8 | 9,663 | 4.1 | |||||||
| Total commercial loans | 80,812 | 29.8 | 53,951 | 22.8 | |||||||
| Consumer loans | 493 | 0.2 | 1,152 | 0.5 | |||||||
| Total loans receivable | 270,931 | 100.0 | % | 236,916 | 100.0 | % | |||||
| Less: | |||||||||||
| Loans in process | 4,600 | 1,499 | |||||||||
| Deferred loan fees | 417 | 334 | |||||||||
| Allowance | 3,602 | 3,634 | |||||||||
| Total loans receivable, net | $ | 262,312 | $ | 231,449 | |||||||
Other real estate owned (OREO) was reduced to zero as of December 31, 2015 compared to $1.3 million at December 31, 2014.
Total deposits at December 31, 2015 were $262.6 million compared with $266.1 million at December 31, 2014. Overall, deposits decreased by $3.5 million; however, non-interest-bearing balances increased by $3.3 million while interest-bearing deposits declined $6.8 million year-over-year as the Company focused on deposit pricing and the development of deeper customer relationships. Within non-interest-bearing accounts, growth was experienced in business checking accounts. Savings and club account growth combined to offset some of the decrease in certificates of deposit during the quarter.
“The year 2015 was a transformative one for the organization. During the course of the year the Company undertook several significant transformations beginning with the adoption of a December fiscal year end, the expansion of an experienced management team and the successful completion of the Company’s stock offering and transition to a fully publicly held institution”, stated Michael A. Shriner, President and Chief Executive Officer. “Our staff is working diligently on a core system conversion that is expected to provide a more efficient and effective delivery system for our products and services to position us in the proper direction toward achieving our goal of becoming a high performing organization. Additionally, our transition to a managed IT function has provided for a stronger infrastructure and has assisted us greatly in managing the increasing risk of cybersecurity.”
Mr. Shriner added, “During 2015, our efforts related to loan production were substantial as well as our management of nonperforming assets indicated by the lack of OREO properties at December 31, 2015. Non-performing loans to total loans were 2.29% at December 31, 2015 compared to 2.57% at December 31, 2014.
“We are pleased to welcome two new experienced directors to our boards this quarter. Together with the board, Millington Bank and its employees are driven to deliver on the Vision that has been defined with Integrity and Passion,” Mr. Shriner concluded.
Forward Looking Statement Disclaimer
The foregoing release may contain forward-looking statements concerning the financial condition, results of operations and business of the Company. We caution that such statements are subject to a number of uncertainties and actual results could differ materially, and, therefore, readers should not place undue reliance on any forward-looking statements. Factors that may cause actual results to differ from those contemplated include our continued ability to grow the loan portfolio, the successful conversion of our core system and our continued ability to manage cybersecurity risks.
| MSB FINANCIAL CORP | ||||||
| (In Thousands, except for per share amount) | (Unaudited) | |||||
| Statement of Financial Condition Data: | 12/31/2015 | 12/31/2014 | ||||
| Total assets | $ | 375,690 | $ | 340,252 | ||
| Cash and cash equivalents | 12,303 | 7,519 | ||||
| Loans receivable, net | 262,312 | 231,449 | ||||
| Securities held to maturity | 78,995 | 78,518 | ||||
| Deposits | 262,598 | 266,068 | ||||
| Federal Home Loan Bank advances | 32,675 | 30,000 | ||||
| Total stockholders' equity | 76,363 | 41,025 | ||||
| Stock Information: | ||||||
| Number of shares of common stock outstanding | 5,954 | 5,010 | ||||
| Book value per share of common stock* | $ | 12.83 | $ | 8.19 | ||
| Closing market price | $ | 12.50 | $ | 8.99 | ||
| *In in previous quarters, the unallocated shares of ESOP reduced the number of shares used for the calculation and to be consistent with industry releases we have adjusted our calculation to conform and make the date comparable to others within our industry. | ||||||
| Summary of Operations: (In Thousands, except for per share amounts) | (Unaudited) For the three months ended December 31, | (Unaudited) For the twelve months ended December 31, | ||||||||||
| 2015 | 2014 | 2015 | 2014 | |||||||||
| Total interest income | $ | 3,123 | $ | 2,981 | $ | 12,206 | $ | 11,990 | ||||
| Total interest expense | 522 | 582 | 2,156 | 2,346 | ||||||||
| Net interest income | 2,601 | 2,399 | 10,050 | 9,644 | ||||||||
| Provision for loan losses | 90 | - | 113 | 400 | ||||||||
| Net interest income after provision for loan losses | 2,511 | 2,399 | 9,937 | 9,244 | ||||||||
| Non-interest income | 210 | 162 | 714 | 685 | ||||||||
| Non-interest expense | 2,724 | 2,628 | 10,024 | 8,878 | ||||||||
| (Loss) income before taxes | (3 | ) | (67 | ) | 627 | 1,051 | ||||||
| Income tax (benefit) expense | (5 | ) | (58 | ) | 184 | 344 | ||||||
| Net income | $ | 2 | $ | (9 | ) | $ | 443 | $ | 707 | |||
| Net income per common share - basic | - | - | 0.08 | 0.13 | ||||||||
| Net income per common share - diluted | - | - | 0.08 | 0.13 | ||||||||
| Weighted average number of shares - basic | 5,737 | 5,632 | 5,685 | 5,625 | ||||||||
| Weighted average number of shares - diluted | 5,786 | 5,632 | 5,717 | 5,625 | ||||||||
| Performance Ratios: | ||||||||||||
| Return on average assets annualized | 0.00 | % | (0.01 | )% | 0.12 | % | 0.21 | % | ||||
| Return on average common equity annualized | 0.01 | % | (0.09 | )% | 0.79 | % | 1.73 | % | ||||
| Net interest margin | 2.96 | % | 3.02 | % | 2.95 | % | 3.00 | % | ||||
| Efficiency ratio | 96.91 | % | 102.62 | % | 93.13 | % | 85.95 | % | ||||
| Operating expenses / average assets annualized | 2.92 | % | 3.08 | % | 2.77 | % | 2.58 | % | ||||
| For the three months ended | ||||||||||||||||||
| 12/31/15 | 12/31/14 | |||||||||||||||||
| Average Balance Sheet (In Thousands) | Average Balance | Interest Income/Expense | Yield | Average Balance | Interest Income/Expense | Yield | ||||||||||||
| Interest-earning assets: | ||||||||||||||||||
| Loans Receivable | $ | 261,090 | $ | 2,660 | 4.08 | % | $ | 234,772 | $ | 2,537 | 4.32 | % | ||||||
| Securities held to maturity | 79,112 | 438 | 2.21 | 79,750 | 423 | 2.12 | ||||||||||||
| Other interest-earning assets | 11,490 | 25 | 0.87 | 3,056 | 21 | 2.75 | ||||||||||||
| Total interest-earning assets | 351,692 | 3,123 | 3.55 | 317,578 | 2,981 | 3.75 | ||||||||||||
| Allowance for Loan Loss | (3,631 | ) | (3,523 | ) | ||||||||||||||
| Non-interest-earning assets | 24,961 | 27,719 | ||||||||||||||||
| Total non-interest-earning assets | 21,330 | 24,196 | ||||||||||||||||
| Total Assets | $ | 373,022 | $ | 341,774 | ||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||
| NOW & Money Market | $ | 44,789 | $ | 19 | 0.17 | % | $ | 42,367 | $ | 16 | 0.15 | % | ||||||
| Savings and club deposits | 102,156 | 58 | 0.23 | 99,938 | 55 | 0.22 | ||||||||||||
| Certificates of deposit | 82,741 | 241 | 1.17 | 95,985 | 318 | 1.33 | ||||||||||||
| Total interest-bearing deposits | 229,686 | 318 | 0.55 | 238,290 | 389 | 0.65 | ||||||||||||
| Federal Home Loan Bank advances | 32,675 | 204 | 2.50 | 30,870 | 193 | 2.50 | ||||||||||||
| Total interest-bearing liabilities | 262,361 | 522 | 0.80 | 269,160 | 582 | 0.86 | ||||||||||||
| Non-interest-bearing deposit | 30,462 | 28,413 | ||||||||||||||||
| Other non-interest-bearing liabilities | 3,504 | 2,858 | ||||||||||||||||
| Total Liabilities | 296,327 | 300,431 | ||||||||||||||||
| Equity | 76,695 | 41,343 | ||||||||||||||||
| Total Liabilities and Equity | $ | 373,022 | $ | 341,774 | ||||||||||||||
| Net Interest Spread | 2,601 | 2.75 | % | 2,399 | 2.89 | % | ||||||||||||
| Net Interest Margin | 2.96 | % | 3.02 | % | ||||||||||||||
| Ratio of Interest Earning Assets to Interest Bearing Liabilities | 134.05 | % | 117.99 | % | ||||||||||||||
| For the twelve months ended | ||||||||||||||||||
| 12/31/15 | 12/31/14 | |||||||||||||||||
| Average Balance Sheet (In Thousands) | Average Balance | Interest Income/Expense | Yield | Average Balance | Interest Income/Expense | Yield | ||||||||||||
| Interest-earning assets: | ||||||||||||||||||
| Loans Receivable | $ | 247,997 | $ | 10,376 | 4.18 | % | $ | 234,619 | $ | 10,095 | 4.30 | % | ||||||
| Securities held to maturity | 79,868 | 1,726 | 2.16 | 83,338 | 1,807 | 2.17 | ||||||||||||
| Other interest-earning assets | 12,880 | 104 | 0.81 | 3,428 | 88 | 2.57 | ||||||||||||
| Total interest-earning assets | 340,745 | 12,206 | 3.58 | 321,385 | 11,990 | 3.73 | ||||||||||||
| Allowance for Loan Loss | (3,593 | ) | (3,645 | ) | ||||||||||||||
| Non-interest-earning assets | 25,066 | 26,842 | ||||||||||||||||
| Total non-interest-earning assets | 21,473 | 23,197 | ||||||||||||||||
| Total Assets | $ | 362,218 | $ | 344,582 | ||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||
| NOW & Money Market | $ | 46,493 | $ | 75 | 0.16 | % | $ | 41,217 | $ | 57 | 0.14 | % | ||||||
| Savings and club deposits | 101,106 | 223 | 0.22 | 103,345 | 223 | 0.22 | ||||||||||||
| Certificates of deposit | 86,948 | 1,064 | 1.22 | 97,640 | 1.291 | 1.32 | ||||||||||||
| Total interest-bearing deposits | 234,547 | 1,362 | 0.58 | 242,202 | 1,571 | 0.65 | ||||||||||||
| Federal Home Loan Bank advances | 34,087 | 794 | 2.33 | 33,865 | 775 | 2.29 | ||||||||||||
| Total interest-bearing liabilities | 268,634 | 2,156 | 0.80 | 276,067 | 2,346 | 0.85 | ||||||||||||
| Non-interest-bearing deposit | 34,248 | 24,698 | ||||||||||||||||
| Other non-interest-bearing liabilities | 3,135 | 2,959 | ||||||||||||||||
| Total Liabilities | 306,017 | 303,724 | ||||||||||||||||
| Equity | 56,201 | 40,858 | ||||||||||||||||
| Total Liabilities and Equity | $ | 362,218 | $ | 344,582 | ||||||||||||||
| Net Interest Spread | 10,050 | 2.78 | % | 9,644 | 2.88 | % | ||||||||||||
| Net Interest Margin | 2.95 | % | 3.00 | % | ||||||||||||||
| Ratio of Interest Earning Assets to Interest Bearing Liabilities | 126.84 | % | 116.42 | % | ||||||||||||||