Exhibit 99.1
| Contact: | Michael R. Sand, |
| | President & CEO Dean J. Brydon, CFO (360) 533-4747 |
| | |
Timberland Bancorp EPS Increases 40% to $0.21 for First Fiscal Quarter
Declares Dividend to Common Shareholders
HOQUIAM, WA – January 21, 2013 - Timberland Bancorp, Inc. (NASDAQ: TSBK) (“Timberland” or “the Company”) today reported net income of $1.71 million for the quarter ended December 31, 2012. Net income to common shareholders, after adjusting for the preferred stock dividend and the preferred stock discount accretion was $1.44 million, or $0.21 per diluted common share. This compares to net income to common shareholders of $883,000, or $0.13 per diluted common share, for the quarter ended September 30, 2012 and net income to common shareholders of $1.02 million, or $0.15 per diluted common share, for the quarter ended December 31, 2011.
“We are pleased to report a solid first fiscal quarter with continued loan growth, sustained mortgage banking activity and a stable net interest margin,” stated Michael R. Sand, President and CEO. “I am also pleased to announce that Timberland’s Board of Directors has declared a cash dividend of $0.03 per common share payable on February 20, 2013 to shareholders of record on February 6, 2013.”
“We reported last month that the FDIC and the State of Washington Department of Financial Institution’s Memorandum of Understanding (“MOU”) with Timberland Bank had been rescinded. We can now report that the MOU between the Federal Reserve Bank of San Francisco and Timberland Bancorp, Inc. was rescinded on January 15, 2013,” commented Sand.
Fiscal First Quarter 2013 Highlights (at or for the period ended December 31, 2012, compared to December 31, 2011, or September 30, 2012):
| · | Earnings per diluted common share for the current quarter increased 62% to $0.21 from $0.13 for the preceding quarter and increased 40% from $0.15 for the comparable quarter one year ago; |
| · | Net income for the current quarter increased 48% to $1.71 million from $1.15 million for the preceding quarter and increased 33% from $1.28 million for the comparable quarter one year ago; |
| · | Net interest margin for the current quarter remained strong at 3.78%; |
| · | Non-interest income for the current quarter increased 8% to $2.72 million from $2.50 million for the preceding quarter and increased 11% from $2.44 million for the comparable quarter one year ago; |
| · | Total delinquent and non-accrual loans decreased 18% during the quarter and 49% year-over-year; |
| · | Net charge-offs for the current quarter decreased 62% to $256,000 compared to $679,000 for preceding quarter and decreased 59% from $624,000 for the comparable quarter one year ago; |
| · | Capital levels remain very strong: Total Risk Based Capital Ratio of 16.92%; Tier 1 Leverage Capital Ratio of 11.86%; Tangible Capital to Tangible Assets Ratio of 11.81%; and |
| · | Book value per common share increased to $10.73, and tangible book value per common share increased to $9.90 at quarter end. |
Capital Ratios and Asset Quality
Timberland Bancorp remains very well capitalized with a total risk-based capital ratio of 16.92%, a Tier 1 leverage capital ratio of 11.86% and a tangible capital to tangible assets ratio of 11.81% at December 31, 2012. On November 1, 2012 the U.S. Treasury successfully auctioned the preferred shares it had purchased from Timberland in December 2008. The clearing price in the auction was $862.50 per preferred share and the sale closed on November 13, 2012. Timberland is no longer a participant in the Treasury’s TARP program since the preferred shares are now owned by private investors. The sale of the preferred shares did not affect Timberland’s capital ratios since the terms of the preferred shares did not change in connection with the sale.
Timberland Q1 Earnings
January 21, 2013
Page 2
Timberland provisioned $200,000 to its loan loss allowance during the quarter ended December 31, 2012 compared to $900,000 in the preceding quarter and $650,000 in the comparable quarter one year ago. Net charge-offs for the first fiscal quarter decreased to $256,000 compared to $679,000 for the preceding quarter and $624,000 for the comparable quarter one year ago. Net charge-offs during the current quarter were reduced by recoveries of $240,000 on loans previously charged off.
Total delinquent loans (past due 30 days or more) and non-accrual loans decreased 18% to $25.0 million at December 31, 2012 from $30.4 million at September 30, 2012 and decreased 49% from $49.1 million one year ago. The non-performing assets to total assets ratio decreased to 5.13% at December 31, 2012 compared to 5.19% three months earlier and 5.55% one year ago.
Non-accrual loans increased slightly to $21.7 million at December 31, 2012 from $21.3 million at September 30, 2012 and decreased from $27.8 million at December 31, 2011. The non-accrual loans at December 31, 2012 were comprised of 58 loans and 46 credit relationships. By dollar amount per category: 39% of non-accrual loans are secured by land and land development properties; 31% are secured by residential properties; 27% are secured by commercial properties; and 3% are secured by residential construction projects.
Other real estate owned (“OREO”) and other repossessed assets decreased to $13.2 million at December 31, 2012 from $13.3 million at September 30, 2012 and increased from $7.7 million at December 31, 2011. At December 31, 2012 the OREO portfolio consisted of 55 individual properties. The properties consisted of eight commercial real estate properties totaling $6.4 million, 34 land parcels totaling $4.3 million, 12 single family homes totaling $1.6 million and a condominium project of $842,000. During the quarter ended December 31, 2012, 12 OREO properties totaling $1.2 million were sold for a net gain of $211,000.
Balance Sheet Management
Total assets decreased by $2.3 million to $734.6 million at December 31, 2012 from $737.0 million at September 30, 2012. The decrease in total assets was primarily due to a $3.5 million decrease in total deposits which reduced the amount of assets held in overnight funds.
Liquidity as measured by cash and cash equivalents, CDs held for investment and available for sale investments was 18.2% of total liabilities at December 31, 2012 compared to 19.3% at September 30, 2012 and 21.2% one year ago.
Net loans receivable increased $6.4 million to $544.9 million at December 31, 2012 from $538.5 million at September 30, 2012. The increase was primarily due to a $14.3 million increase in commercial real estate loan balances, a $1.9 million increase in one-to four-family loan balances, a $943,000 increase in multi-family loan balances and a $2.2 million decrease in the undisbursed portion of construction loans in process. These increases to net loans receivable were partially offset by decreases of $9.4 million in construction and land development loan balances, $1.8 million in consumer loan balances and $1.7 million in land loan balances. The increase in commercial real estate loan balances and the decrease in construction loan balances were primarily due to several large commercial construction loan projects converting to permanent financing during the quarter.
Timberland continued to reduce its exposure to land development and land loans. Land development loan balances decreased to $581,000 at December 31, 2012, a 68% decrease year-over-year. The Bank’s land loan portfolio decreased to $37.9 million at December 31, 2012, a 4% decrease from the preceding quarter and an 18% decrease year-over-year. The well diversified land loan portfolio consists of 301 loans on a variety of land types including individual building lots, acreage, raw land and commercially zoned properties. The average loan balance for the entire land portfolio was approximately $126,000 at December 31, 2012.
Timberland Q1 Earnings
January 21, 2013
Page 3
LOAN PORTFOLIO
| | | December 31, 2012 | | | September 30, 2012 | | | December 31, 2011 | |
| ($ in thousands) | | Amount | | | Percent | | | Amount | | | Percent | | | Amount | | | Percent | |
| | | | | | | | | | | | | | | | | | | |
| Mortgage Loans: | | | | | | | | | | | | | | | | | | |
| One-to four-family | | $ | 108,835 | | | | 19 | % | | $ | 106,979 | | | | 19 | % | | $ | 110,502 | | | | 20 | % |
| Multi-family | | | 48,464 | | | | 8 | | | | 47,521 | | | | 8 | | | | 30,866 | | | | 6 | |
| Commercial | | | 270,537 | | | | 47 | | | | 256,254 | | | | 45 | | | | 245,874 | | | | 44 | |
| Construction and land | | | | | | | | | | | | | | | | | | | | | | | | |
| development | | | 46,985 | | | | 8 | | | | 56,406 | | | | 10 | | | | 57,803 | | | | 10 | |
| Land | | | 37,920 | | | | 7 | | | | 39,655 | | | | 7 | | | | 46,198 | | | | 8 | |
| Total mortgage loans | | | 512,741 | | | | 89 | | | | 506,815 | | | | 89 | | | | 491,243 | | | | 88 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Consumer Loans: | | | | | | | | | | | | | | | | | | | | | | | | |
| Home equity and second | | | | | | | | | | | | | | | | | | | | | | | | |
| mortgage | | | 31,196 | | | | 6 | | | | 32,814 | | | | 6 | | | | 34,607 | | | | 6 | |
| Other | | | 6,029 | | | | 1 | | | | 6,183 | | | | 1 | | | | 6,695 | | | | 1 | |
| Total consumer loans | | | 37,225 | | | | 7 | | | | 38,997 | | | | 7 | | | | 41,302 | | | | 7 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial business loans | | | 22,596 | | | | 4 | | | | 22,588 | | | | 4 | | | | 27,426 | | | | 5 | |
| Total loans | | | 572,562 | | | | 100 | % | | | 568,400 | | | | 100 | % | | | 559,971 | | | | 100 | % |
| Less: | | | | | | | | | | | | | | | | | | | | | | | | |
| Undisbursed portion of | | | | | | | | | | | | | | | | | | | | | | | | |
| construction loans in | | | | | | | | | | | | | | | | | | | | | | | | |
| process | | | (14,100 | ) | | | | | | | (16,325 | ) | | | | | | | (17,073 | ) | | | | |
| Deferred loan origination | | | | | | | | | | | | | | | | | | | | | | | | |
| fees | | | (1,767 | ) | | | | | | | (1,770 | ) | | | | | | | (1,884 | ) | | | | |
| Allowance for loan losses | | | (11,769 | ) | | | | | | | (11,825 | ) | | | | | | | (11,972 | ) | | | | |
| Total loans receivable, net | | $ | 544,926 | | | | | | | $ | 538,480 | | | | | | | $ | 529,042 | | | | | |
CONSTRUCTION LOAN COMPOSITION
| | | December 31, 2012 | | | September 30, 2012 | | | December 31, 2011 | |
| ($ in thousands) | | Amount | | | Percent of Loan Portfolio | | | Amount | | | Percent of Loan Portfolio | | | Amount | | | Percent of Loan Portfolio | |
| | | | | | | | | | | | | | | | | | | |
| Custom and owner / builder | | $ | 33,530 | | | | 6 | % | | $ | 33,345 | | | | 6 | % | | $ | 28,797 | | | | 5 | % |
| Speculative one- to four- | | | | | | | | | | | | | | | | | | | | | | | | |
| family | | | 1,912 | | | | -- | | | | 1,880 | | | | -- | | | | 2,186 | | | | 1 | |
| Commercial real estate | | | 10,617 | | | | 2 | | | | 20,247 | | | | 4 | | | | 16,693 | | | | 3 | |
| Multi-family (including | | | | | | | | | | | | | | | | | | | | | | | | |
| condominium) | | | 345 | | | | -- | | | | 345 | | | | -- | | | | 8,320 | | | | 1 | |
| Land development | | | 581 | | | | -- | | | | 589 | | | | -- | | | | 1,807 | | | | -- | |
| Total construction loans | | $ | 46,985 | | | | 8 | % | | $ | 56,406 | | | | 10 | % | | $ | 57,803 | | | | 10 | % |
Timberland Q1 Earnings
January 21, 2013
Page 4
Timberland’s loan originations were $51.9 million during the quarter ended December 31, 2012 compared to $69.0 million for the preceding quarter and $51.6 million for the quarter one year ago. Timberland continues to sell fixed rate one-to-four family mortgage loans into the secondary market for asset–liability management purposes and to generate non-interest income. During the quarter ended December 31, 2012, $24.1 million fixed-rate one-to four-family mortgage loans were sold compared to $28.5 million for the preceding quarter and $22.9 million for the comparable quarter ended one year ago.
Timberland’s mortgage-backed securities (“MBS”) and other investments decreased by $405,000 during the quarter to $7.9 million at December 31, 2012 from $8.3 million at September 30, 2012, primarily due to prepayments and scheduled amortization. During the quarter ended December 31, 2012, other-than-temporary-impairment (“OTTI”) credit related write-downs and realized losses of $10,000 were recorded on private label MBS. At December 31, 2012 the Bank’s remaining private label MBS portfolio had been reduced to $2.7 million from an original acquired balance of $15.3 million.
DEPOSIT BREAKDOWN ($ in thousands) | |
| | | December 31, 2012 | | | September 30, 2012 | | | December 31, 2011 | |
| | | Amount | | | Percent | | | Amount | | | Percent | | | Amount | | | Percent | |
| Non-interest bearing | | $ | 78,425 | | | | 13 | % | | $ | 75,296 | | | | 13 | % | | $ | 61,178 | | | | 10 | % |
| N.O.W. checking | | | 152,431 | | | | 26 | | | | 150,139 | | | | 25 | | | | 156,799 | | | | 27 | |
| Savings | | | 87,628 | | | | 15 | | | | 87,493 | | | | 15 | | | | 85,335 | | | | 15 | |
| Money market | | | 79,142 | | | | 13 | | | | 79,549 | | | | 13 | | | | 66,266 | | | | 11 | |
| Certificates of deposit under $100 | | | 123,510 | | | | 21 | | | | 127,909 | | | | 21 | | | | 136,859 | | | | 23 | |
| Certificates of deposit $100 and over | | | 73,263 | | | | 12 | | | | 77,540 | | | | 13 | | | | 82,738 | | | | 14 | |
| Certificates of deposit – brokered | | | - - | | | | -- | | | | - - | | | | -- | | | | -- | | | | -- | |
| Total deposits | | $ | 594,399 | | | | 100 | % | | $ | 597,926 | | | | 100 | % | | $ | 589,175 | | | | 100 | % |
Total deposits decreased $3.5 million, or 1% to $594.4 million at December 31, 2012, from $597.9 million at September 30, 2012 primarily as a result of an $8.7 million decrease in certificates of deposit account balances and a $407,000 decrease in money market account balances. These decreases were partially offset by increases of $3.1 million in non-interest bearing account balances and $2.3 million in N.O.W. checking account balances.
Total shareholders’ equity increased $1.58 million to $91.90 million at December 31, 2012, from $90.32 million at September 30, 2012. The increase in shareholders’ equity was primarily a result of net income for the quarter. Book value per common share increased to $10.73 and tangible book value per common share increased to $9.90 at December 31, 2012.
Operating Results
Fiscal first quarter operating revenue (net interest income before provision for loan losses, plus non-interest income excluding OTTI charges and valuation allowances or recoveries on mortgage servicing rights (“MSRs”)), decreased 3% to $8.86 million from $9.12 million for the preceding quarter and increased 2% from the $8.72 million for the comparable quarter one year ago.
Net interest income decreased 1% to $6.39 million for the quarter ended December 31, 2012 from $6.46 million for the preceding quarter and increased 1% from $6.30 million for the comparable quarter one year ago. The net interest margin for the current quarter decreased to 3.78% from 3.83% for the preceding quarter and increased from 3.73% for the comparable quarter one year ago.
Non-interest income increased 8% to $2.72 million for the quarter ended December 31, 2012, from $2.50 million in the preceding quarter and increased 11% from $2.44 million for the comparable quarter one year ago. The increase in non-interest income compared to the preceding quarter was primarily due to a $388,000 net increase in the valuation adjustment on the Bank’s MSRs, which was partially offset by $107,000 decrease in gain on sale of loans. The $388,000 net increase in the valuation adjustment was comprised of a $254,000 recovery in the current quarter and a $134,000 allowance in the preceding quarter. The decrease in gains on sale of loans was primarily due to a decrease in the dollar volume of fixed-rate one-to four-family loans sold during the current quarter.
Timberland Q1 Earnings
January 21, 2013
Page 5
Total operating (non-interest) expenses decreased 4% to $6.38 million for the first fiscal quarter from $6.68 million for the preceding quarter and increased 3% from $6.22 million for the comparable quarter one year ago. The decreased expenses for the current quarter compared to the preceding quarter were primarily the result of a $396,000 decrease in OREO and other repossessed assets expense. OREO related expenses during the current quarter were reduced by $211,000 in net gains on sale of OREO properties.
The provision for income taxes increased $589,000 to $819,000 for the quarter ended December 31, 2012, from $230,000 for the preceding quarter primarily due to higher income before income taxes. Also affecting the comparison was a $205,000 recovery to the deferred tax valuation allowance (recorded during the quarter ended September 30, 2012) based on the expected implementation of certain tax planning strategies. The deferred tax valuation allowance relates to a capital loss carry forward on the sale of securities in fiscal 2008.
About Timberland Bancorp, Inc.
Timberland Bancorp, Inc., a Washington corporation, is the holding company for Timberland Bank (“Bank”). The Bank opened for business in 1915 and serves consumers and businesses across Grays Harbor, Thurston, Pierce, King, Kitsap and Lewis counties, Washington with a full range of lending and deposit services through its 22 branches (including its main office in Hoquiam).
Disclaimer
Certain matters discussed in this press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact and often include the words “believes,” “expects,” “anticipates,” “estimates,” “forecasts,” “intends,” “plans,” “targets,” “potentially,” “probably,” “projects,” “outlook” or similar expressions or future or conditional verbs such as “may,” “will,” “should,” “would” and “could.” Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, assumptions and statements about future performance. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause our actual results to differ materially from the results anticipated, including, but not limited to: the credit risks of lending activities, including changes in the level and trend of loan delinquencies and write-offs and changes in our allowance for loan losses and provision for loan losses that may be impacted by deterioration in the housing and commercial real estate markets and may lead to increased losses and non-performing assets in our loan portfolio, and may result in our allowance for loan losses not being adequate to cover actual losses, and require us to materially increase our loan loss reserves; changes in general economic conditions, either nationally or in our market areas; changes in the levels of general interest rates, and the relative differences between short and long term interest rates, deposit interest rates, our net interest margin and funding sources; fluctuations in the demand for loans, the number of unsold homes, land and other properties and fluctuations in real estate values in our market areas; secondary market conditions for loans and our ability to sell loans in the secondary market; results of examinations of us by the Board of Governors of the Federal Reserve System and our bank subsidiary by the Federal Deposit Insurance Corporation, the Washington State Department of Financial Institutions, Division of Banks or other regulatory authorities, including the possibility that any such regulatory authority may, among other things, institute a formal or informal enforcement action or require us to increase our allowance for loan losses, write-down assets, change our regulatory capital position or affect our ability to borrow funds or maintain or increase deposits or impose additional requirements or restrictions, which could adversely affect our liquidity and earnings; legislative or regulatory changes that adversely affect our business including changes in regulatory policies and principles, or the interpretation of regulatory capital or other rules including as a result of Basel III; the impact of the Dodd Frank Wall Street Reform and Consumer Protection Act and the implementation of related rules and regulations; our ability to attract and retain deposits; increases in premiums for deposit insurance; our ability to control operating costs and expenses; the use of estimates in determining fair value of certain of our assets, which estimates may prove to be incorrect and result in significant declines in valuation; difficulties in reducing risk associated with the loans on our consolidated balance sheet; staffing fluctuations in response to product demand or the implementation of corporate strategies that affect our workforce and potential associated charges; computer systems on which we depend could fail or experience a security breach; our ability to retain key members of our senior management team; costs and effects of litigation, including settlements and judgments; our ability to successfully integrate any assets, liabilities, customers, systems, and management personnel we may in the future acquire into our operations and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto; our ability to manage loan delinquency rates; increased competitive pressures among financial services companies; changes in consumer spending, borrowing and savings habits; the availability of resources to address changes in laws, rules, or regulations or to respond to regulatory actions; our ability to pay dividends on our common and preferred stock; adverse changes in the securities markets; inability of key third-party providers to perform their obligations to us; changes in accounting policies and practices, as may be adopted by the financial institution regulatory agencies or the Financial Accounting Standards Board, including additional guidance and interpretation on accounting issues and details of the implementation of new accounting methods; the economic impact of war or any terrorist activities; other economic, competitive, governmental, regulatory, and technological factors affecting our operations; pricing, products and services; and other risks detailed in our reports filed with the Securities and Exchange Commission.
Any of the forward-looking statements that we make in this press release and in the other public statements we make are based upon management’s beliefs and assumptions at the time they are made. We undertake no obligation to publicly update or revise any forward-looking statements included in this report or to update the reasons why actual results could differ from those contained in such statements, whether as a result of new information, future events or otherwise. We caution readers not to place undue reliance on any forward-looking statements. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. These risks could cause our actual results for fiscal 2013 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of us, and could negatively affect the Company’s operations and stock price performance.
Timberland Q1 Earnings
January 21, 2013
Page 6
TIMBERLAND BANCORP INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
($ in thousands, except per share amounts)
| | | Three Months Ended | |
| | Dec. 31, | | | Sept. 30, | | | Dec. 31, | |
| | | 2012 | | | 2012 | | | 2011 | |
| Interest and dividend income | | | | | | | | | |
| Loans receivable | | $ | 7,414 | | | $ | 7,577 | | | $ | 7,805 | |
| MBS and other investments | | | 77 | | | | 81 | | | | 125 | |
| Dividends from mutual funds | | | 12 | | | | 6 | | | | 13 | |
| Interest bearing deposits in banks | | | 86 | | | | 86 | | | | 89 | |
| Total interest and dividend income | | | 7,589 | | | | 7,750 | | | | 8,032 | |
| | | | | | | | | | | | | |
| Interest expense | | | | | | | | | | | | |
| Deposits | | | 728 | | | | 822 | | | | 1,169 | |
FHLB advances | | | 472 | | | | 472 | | | | 562 | |
| Total interest expense | | | 1,200 | | | | 1,294 | | | | 1,731 | |
| Net interest income | | | 6,389 | | | | 6,456 | | | | 6,301 | |
| | | | | | | | | | | | | |
| Provision for loan losses | | | 200 | | | | 900 | | | | 650 | |
| Net interest income after provision for loan losses | | | 6,189 | | | | 5,556 | | | | 5,651 | |
| | | | | | | | | | | | | |
| Non-interest income | | | | | | | | | | | | |
| OTTI and realized losses on MBS | | | | | | | | | | | | |
and other investments, net | | | (10 | ) | | | (25 | ) | | | (60 | ) |
| Service charges on deposits | | | 947 | | | | 980 | | | | 970 | |
| Gain on sale of loans, net | | | 642 | | | | 749 | | | | 560 | |
| Bank owned life insurance (“BOLI”) net earnings | | | 143 | | | | 150 | | | | 157 | |
| Valuation recovery (allowance) on MSRs | | | 254 | | | | (134 | ) | | | 84 | |
| ATM and debit card interchange transaction fees | | | 515 | | | | 551 | | | | 517 | |
| Other | | | 224 | | | | 232 | | | | 216 | |
| Total non-interest income, net | | | 2,715 | | | | 2,503 | | | | 2,444 | |
| | | | | | | | | | | | | |
| Non-interest expense | | | | | | | | | | | | |
| Salaries and employee benefits | | | 3,114 | | | | 3,061 | | | | 2,929 | |
| Premises and equipment | | | 690 | | | | 696 | | | | 650 | |
| Advertising | | | 177 | | | | 173 | | | | 208 | |
| OREO and other repossessed assets expense, net | | | 288 | | | | 684 | | | | 502 | |
| ATM | | | 221 | | | | 196 | | | | 194 | |
| Postage and courier | | | 113 | | | | 120 | | | | 118 | |
| Amortization of core deposit intangible (“CDI”) | | | 33 | | | | 37 | | | | 37 | |
| State and local taxes | | | 139 | | | | 148 | | | | 149 | |
| Professional fees | | | 242 | | | | 195 | | | | 178 | |
| FDIC insurance | | | 241 | | | | 239 | | | | 225 | |
| Other insurance | | | 52 | | | | 51 | | | | 56 | |
| Loan administration and foreclosure | | | 138 | | | | 201 | | | | 161 | |
| Data processing and telecommunications | | | 287 | | | | 346 | | | | 300 | |
| Deposit operations | | | 164 | | | | 183 | | | | 223 | |
| Other | | | 478 | | | | 347 | | | | 291 | |
| Total non-interest expense | | | 6,377 | | | | 6,677 | | | | 6,221 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| (Table continued on following page) | |
Timberland Q1 Earnings
January 21, 2013
Page 7
| | | Three Months Ended | |
| | | Dec. 31, | | | Sept. 30, | | | Dec. 31, | |
| | | 2012 | | | 2012 | | | 2011 | |
| Income before income taxes | | $ | 2,527 | | | $ | 1,382 | | | $ | 1,874 | |
| Provision for income taxes | | | 819 | | | | 230 | | | | 591 | |
| Net income | | | 1,708 | | | | 1,152 | | | | 1,283 | |
| | | | | | | | | | | | | |
| Preferred stock dividends | | | (201 | ) | | | (208 | ) | | | (208 | ) |
| Preferred stock discount accretion | | | (63 | ) | | | (61 | ) | | | (59 | ) |
| Net income to common shareholders | | $ | 1,444 | | | $ | 883 | | | $ | 1,016 | |
| | | | | | | | | | | | | |
| Net income per common share: | | | | | | | | | | | | |
Basic | | $ | 0.21 | | | $ | 0.13 | | | $ | 0.15 | |
Diluted | | | 0.21 | | | | 0.13 | | | | 0.15 | |
| | | | | | | | | | | | | |
| Weighted average common shares outstanding: | | | | | | | | | | | | |
Basic | | | 6,815,782 | | | | 6,780,899 | | | | 6,780,516 | |
Diluted | | | 6,815,782 | | | | 6,780,899 | | | | 6,780,516 | |
Timberland Q1 Earnings
January 21, 2013
Page 8
TIMBERLAND BANCORP INC. AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS | | | |
| ($ in thousands, except per share amounts) (unaudited) | | Dec. 31, | | | Sept. 30, | | | Dec. 31, | |
| | | 2012 | | | 2012 | | | 2011 | |
| Assets | | | | | | | | | |
| Cash and due from financial institutions | | $ | 12,082 | | | $ | 11,008 | | | $ | 12,671 | |
| Interest-bearing deposits in banks | | | 73,766 | | | | 85,660 | | | | 98,876 | |
| Total cash and cash equivalents | | | 85,848 | | | | 96,668 | | | | 111,547 | |
| | | | | | | | | | | | | |
| Certificates of deposit (“CDs”) held for investment, at cost | | | 26,752 | | | | 23,490 | | | | 19,810 | |
| MBS and other investments: | | | | | | | | | | | | |
| Held to maturity, at amortized cost | | | 3,197 | | | | 3,339 | | | | 3,941 | |
| Available for sale, at fair value | | | 4,682 | | | | 4,945 | | | | 6,284 | |
| FHLB stock | | | 5,604 | | | | 5,655 | | | | 5,705 | |
| | | | | | | | | | | | | |
| Loans receivable | | | 554,659 | | | | 548,878 | | | | 537,904 | |
| Loans held for sale | | | 2,036 | | | | 1,427 | | | | 3,110 | |
| Less: Allowance for loan losses | | | (11,769 | ) | | | (11,825 | ) | | | (11,972 | ) |
| Net loans receivable | | | 544,926 | | | | 538,480 | | | | 529,042 | |
| | | | | | | | | | | | | |
| Premises and equipment, net | | | 18,027 | | | | 17,886 | | | | 17,353 | |
| OREO and other repossessed assets, net | | | 13,230 | | | | 13,302 | | | | 7,714 | |
| BOLI | | | 16,668 | | | | 16,524 | | | | 16,074 | |
| Accrued interest receivable | | | 2,080 | | | | 2,183 | | | | 2,388 | |
| Goodwill | | | 5,650 | | | | 5,650 | | | | 5,650 | |
| Core deposit intangible | | | 217 | | | | 249 | | | | 360 | |
| Mortgage servicing rights, net | | | 2,213 | | | | 2,011 | | | | 2,169 | |
| Prepaid FDIC insurance assessment | | | 957 | | | | 1,186 | | | | 1,873 | |
| Other assets | | | 4,570 | | | | 5,386 | | | | 5,939 | |
| Total assets | | $ | 734,621 | | | $ | 736,954 | | | $ | 735,849 | |
| | | | | | | | | | | | | |
| Liabilities and shareholders’ equity | | | | | | | | | | | | |
| Deposits: Non-interest-bearing demand | | $ | 78,425 | | | $ | 75,296 | | | $ | 61,178 | |
| Deposits: Interest-bearing | | | 515,974 | | | | 522,630 | | | | 527,997 | |
| Total deposits | | | 594,399 | | | | 597,926 | | | | 589,175 | |
| | | | | | | | | | | | | |
| FHLB advances | | | 45,000 | | | | 45,000 | | | | 55,000 | |
| Repurchase agreements | | | 625 | | | | 855 | | | | 538 | |
| Other liabilities and accrued expenses | | | 2,694 | | | | 2,854 | | | | 3,806 | |
| Total liabilities | | | 642,718 | | | | 646,635 | | | | 648,519 | |
| Shareholders’ equity | | | | | | | | | | | | |
Preferred stock, $.01 par value; 1,000,000 shares authorized; 16,641 shares, Series A, issued and outstanding $1,000 per share liquidation value | | | 16,292 | | | | 16,229 | | | | 16,048 | |
Common stock, $.01 par value; 50,000,000 shares authorized; 7,045,036 shares issued and outstanding | | | 10,500 | | | | 10,484 | | | | 10,464 | |
| Unearned shares- Employee Stock Ownership Plan | | | (1,653 | ) | | | (1,719 | ) | | | (1,917 | ) |
| Retained earnings | | | 67,232 | | | | 65,788 | | | | 63,286 | |
| Accumulated other comprehensive loss | | | (468 | ) | | | (463 | ) | | | (551 | ) |
| Total shareholders’ equity | | | 91,903 | | | | 90,319 | | | | 87,330 | |
| Total liabilities and shareholders’ equity | | $ | 734,621 | | | $ | 736,954 | | | $ | 735,849 | |
Timberland Q1 Earnings
January 21, 2013
Page 9
| KEY FINANCIAL RATIOS AND DATA | | Three Months Ended | |
| ($ in thousands, except per share amounts) (unaudited) | | Dec. 31, | | | Sept. 30, | | | Dec. 31, | |
| | | 2012 | | | 2012 | | | 2011 | |
| | | | | | | | | | |
| PERFORMANCE RATIOS: | | | | | | | | | |
| Return on average assets (a) | | | 0.92 | % | | | 0.62 | % | | | 0.70 | % |
| Return on average equity (a) | | | 7.53 | % | | | 5.14 | % | | | 5.93 | % |
| Net interest margin (a) | | | 3.78 | % | | | 3.83 | % | | | 3.73 | % |
| Efficiency ratio | | | 70.05 | % | | | 74.53 | % | | | 71.14 | % |
| | | | | | | | | | | | | |
| | | Dec. 31, | | | Sept. 30, | | | Dec. 31, | |
| | | 2012 | | | 2012 | | | 2011 | |
| ASSET QUALITY RATIOS AND DATA: | | | | | | | | | | | | |
| Non-accrual loans | | $ | 21,737 | | | $ | 21,331 | | | $ | 27,803 | |
| Loans past due 90 days and still accruing | | | 357 | | | | 1,198 | | | | 2,677 | |
| Non-performing investment securities | | | 2,334 | | | | 2,442 | | | | 2,650 | |
| OREO and other repossessed assets | | | 13,230 | | | | 13,302 | | | | 7,714 | |
| Total non-performing assets (b) | | $ | 37,658 | | | $ | 38,273 | | | $ | 40,844 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Non-performing assets to total assets (b) | | | 5.13 | % | | | 5.19 | % | | | 5.55 | % |
| Net charge-offs during quarter | | $ | 256 | | | $ | 679 | | | $ | 624 | |
| Allowance for loan losses to non-accrual loans | | | 54 | % | | | 55 | % | | | 43 | % |
| Allowance for loan losses to loans receivable, net (c) | | | 2.11 | % | | | 2.15 | % | | | 2.21 | % |
| Troubled debt restructured loans on accrual status (d) | | $ | 13,008 | | | $ | 13,410 | | | $ | 18,297 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| CAPITAL RATIOS: | | | | | | | | | | | | |
| Tier 1 leverage capital | | | 11.86 | % | | | 11.66 | % | | | 11.26 | % |
| Tier 1 risk based capital | | | 15.66 | % | | | 15.51 | % | | | 15.39 | % |
| Total risk based capital | | | 16.92 | % | | | 16.77 | % | | | 16.65 | % |
| Tangible capital to tangible assets (e) | | | 11.81 | % | | | 11.55 | % | | | 11.14 | % |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| BOOK VALUES: | | | | | | | | | | | | |
| Book value per common share | | $ | 10.73 | | | $ | 10.52 | | | $ | 10.12 | |
| Tangible book value per common share (e) | | | 9.90 | | | | 9.68 | | | | 9.26 | |
| | | | | | | | | | | | | |
__________________________________________________
(a) Annualized
(b) Non-performing assets include non-accrual loans, loans past due 90 days and still accruing, non-performing investment securities and OREO and other repossessed assets. Troubled debt restructured loans on accrual status are not included.
(c) Includes loans held for sale and is before the allowance for loan losses.
(d) Does not include troubled debt restructured loans totaling $10,733, $10,093 and $7,334 reported as non-accrual loans at December 31, 2012, September 30, 2012 and December 31, 2011, respectively.
(e) Calculation subtracts goodwill and core deposit intangible from the equity component and from assets.
Timberland Q1 Earnings
January 21, 2013
Page 10
| AVERAGE CONSOLIDATED BALANCE SHEETS: | | Three Months Ended | |
| ($ in thousands) (unaudited) | | Dec. 31, | | | Sept. 30, | | | Dec. 31, | |
| | | 2012 | | | 2012 | | | 2011 | |
| | | | | | | | | | |
| Average total loans | | $ | 553,404 | | | $ | 547,028 | | | $ | 537,876 | |
| Average total interest-bearing assets (a) | | | 676,061 | | | | 673,827 | | | | 675,432 | |
| Average total assets | | | 739,858 | | | | 738,161 | | | | 736,265 | |
| Average total interest-bearing deposits | | | 519,308 | | | | 523,461 | | | | 526,100 | |
| Average FHLB advances and other borrowings | | | 45,649 | | | | 45,784 | | | | 55,559 | |
| Average shareholders’ equity | | | 90,721 | | | | 89,695 | | | | 86,534 | |
_________________________________
(a) Includes loans and MBS on non-accrual status
