PRESS RELEASE
FOR RELEASE JANUARY 25, 2013 AT 4:00 P.M.
For More Information Contact
Joseph J. Bouffard
(410) 248-9130
BCSB Bancorp, Inc.
Baltimore County Savings Bank
BCSB BANCORP, INC. REPORTS RESULTS FOR THE FIRST QUARTER ENDED
DECEMBER 31, 2012
BCSB Bancorp, Inc. (the “Company”) (NASDAQ: BCSB), the holding company for Baltimore County Savings Bank (the “Bank”) reported net income of $639,000 or $0.21 per basic share and $.20 per diluted share for the three months ended December 31, 2012, which represents the first quarter of its 2013 fiscal year. This compares to net income of $462,000 or $0.15 per basic and diluted share for the three months ended December 31, 2011.
During the three months ended December 31, 2012, earnings were favorably impacted primarily by higher net interest income and increased non-interest income as compared to the corresponding period during the prior fiscal year. Earnings were negatively affected by increased provision for loan losses as compared with the three months ended December 31, 2011.
The increase in net interest income during the three months ended December 31, 2012 as compared to the three months ended December 31, 2011 was primarily due to declining cost of funds on the deposit portfolio, partially offset by lower interest income from the Company’s loan portfolio, which declined by approximately $26 million during the twelve months ended December 31, 2012.
Non-interest income during the three months ended December 31, 2012 improved in comparison with the three months ended December 31, 2011 partly due to prepayment fees received as certain loans paid off prior to scheduled maturity. The Company also experienced increased commission income from sales of investment products during the current period.
The increase in loan loss provisions during the three months ended December 31, 2012 as compared to the prior year was directly related to declines is estimated realizable values of certain problem loans, primarily investor rental properties. The Company also experienced $0.5 million of net charge-offs during the three months ended December 31, 2012, primarily due to the transfer of a $1.5 million land acquisition and development loan to Foreclosed Real Estate, for which specific loan loss reserves had already been established. Specifically allocated loan loss reserves are charged-off as properties are foreclosed upon.
President and Chief Executive Officer Joseph J. Bouffard commented “Earnings continued to show improvement during the quarter ended December 31, 2012, as was also the case during our most recent fiscal year ended September 30, 2012. Our interest rate spread has improved and operating expenses remain manageable. Notable declines in nonperforming loans and Troubled Debt Restructurings have been achieved as we push hard to resolve problem assets. We remain focused on the Company’s earnings and asset quality with the ultimate goal of improved shareholder value.”
This press release contains statements that are forward-looking, as that term is defined by the Private Securities Litigation Reform Act of 1995 or the Securities and Exchange Commission in its rules, regulations and releases. The Company intends that such forward-looking statements be subject to the safe harbors created thereby. All forward-looking statements are based on current expectations regarding important risk factors, including but not limited to real estate values, market conditions, the impact of interest rates on financing, local and national economic factors and the matters described in “Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended September 30, 2012. Accordingly, actual results may differ from those expressed in the forward-looking statements, and the making of such statements should not be regarded as a representation by the Company or any other person that results expressed herein will be achieved.
BCSB Bancorp, Inc.
Consolidated Statements of Financial Condition
(Unaudited)
| | | December 31, | | | September 30, | |
| | | 2012 | | | 2012 | |
| | | (Dollars in thousands) | |
| ASSETS | | | | | | |
| Cash equivalents and time deposits | | $ | 59,370 | | | $ | 50,924 | |
| Investment Securities, available for sale | | | 4,801 | | | | 4,628 | |
| Loans Receivable, net | | | 329,298 | | | | 335,616 | |
| Mortgage-backed Securities, available for sale | | | 209,018 | | | | 213,563 | |
| Foreclosed Real Estate | | | 3,370 | | | | 1,674 | |
| Premises and Equipment, net | | | 10,183 | | | | 10,288 | |
| Bank Owned Life Insurance | | | 17,007 | | | | 16,869 | |
| Other Assets | | | 10,966 | | | | 11,537 | |
| Total Assets | | $ | 644,013 | | | $ | 645,099 | |
| | | | | | | | | |
| | | | | | | | | |
| LIABILITIES | | | | | | | | |
| Deposits | | $ | 563,992 | | | $ | 566,356 | |
| Junior Subordinated Debentures | | | 17,011 | | | | 17,011 | |
| Other Liabilities | | | 7,395 | | | | 6,593 | |
| Total Liabilities | | | 588,398 | | | | 589,960 | |
| Total Stockholders’ Equity | | | 55,615 | | | | 55,139 | |
| Total Liabilities & Stockholders’ Equity | | $ | 644,013 | | | $ | 645,099 | |
Consolidated Statements of Operations
(Unaudited)
| | | | Three Months ended December 31, |
| | | | 2012 | | | 2011 |
| | | | (Dollars in thousands except per share data) |
| Interest income | | $ | 6,598 | | $ | 6,701 |
| Interest expense | | | 1,484 | | | 1,931 |
| Net interest income | | | 5,114 | | | 4,770 |
| Provision for loan losses | | | 500 | | | 300 |
| Net interest income after provision for loan losses | | | 4,614 | | | 4,470 |
| Total non-interest income | | | 665 | | | 544 |
| Total non-interest expenses | | | 4,267 | | | 4,315 |
| Income before income tax expense | | | 1,012 | | | 699 |
| Income tax expense | | | 373 | | | 237 |
| Net income | | $ | 639 | | $ | 462 |
| | | | | | | |
| Basic Earnings per Share | | $ | 0.21 | | $ | 0.15 |
| | | | | | | |
| Diluted Earnings per Share | | $ | 0.20 | | $ | 0.15 |
Summary of Financial Highlights
(Unaudited)
| | | | Three Months ended December 31, | |
| | | | 2012 | | | 2011 | |
| | | | | | | | |
| Return on average assets (annualized) | | | 0.40 | % | | 0.29 | % |
| Return on average equity (annualized) | | | 4.61 | % | | 3.55 | % |
| | | | | | | | |
| Interest rate spread | | | 3.36 | % | | 3.24 | % |
| Net interest margin | | | 3.39 | % | | 3.26 | % |
| | | | | | | | |
| Efficiency ratio | | | 73.8 | % | | 81.2 | % |
| Ratio of average interest earning assets/interest bearing liabilities | | | 103.4 | % | | 102.0 | % |
| | | | | | | | |
| Tangible Book Value |
| (Unaudited) |
| | | | | | | | | |
| | | | | | | | | |
| | At December 31, | | | At September 30, | | | At December 31, | |
| | 2012 | | | 2012 | | | 2011 | |
| | | | | | | | |
| | (Dollars in thousands except per share data) |
| | | | | | | | | | | | |
| Tangible book value per common share: | | | | | | | | | | | |
| Total stockholders’ equity | $ | 55,615 | | | $ | 55,139 | | | $ | 52,154 | |
| Less: Intangible assets | | (34 | ) | | | (37 | ) | | | (46 | ) |
| Tangible common equity | $ | 55,581 | | | | 55,102 | | | $ | 52,108 | |
| Outstanding common shares | | 3,188,655 | | | | 3,188,655 | | | | 3,188,665 | |
| | | | | | | | | | | | |
Tangible book value per common share (1) | $ | 17.43 | | | $ | 17.28 | | | $ | 16.34 | |
| (1) | Tangible book value provides a measure of tangible equity on a per share basis. It is determined by methods other than in accordance with Accounting Principles Generally Accepted in the United States (“GAAP”) and, as such, is considered to be a non-GAAP financial measure. Management believes the presentation of Tangible book value per common share is meaningful supplemental information for shareholders. We calculate Tangible book value per common share by dividing tangible common equity by common shares outstanding, as of period end. |
Allowance for Loan Losses
(Unaudited)
| | | Three Months ended December 31, |
| | | 2012 | | | 2011 |
| | | (Dollars in thousands) |
| | | |
| Allowance at beginning of period | | $ | 5,470 | | | $ | 4,768 | |
| Provision for loan losses | | | 500 | | | | 300 | |
| Recoveries | | | 23 | | | | 12 | |
| Charge-offs | | | (505 | ) | | | (16 | ) |
| Allowance at end of period | | $ | 5,488 | | | $ | 5,064 | |
| | | | | | | | | |
| Allowance for loan losses as a percentage of gross loans | | | 1.64 | % | | | 1.40 | % |
| | | | | | | | | |
| Allowance for loan losses to nonperforming loans | | | 37 | % | | | 29 | % |
Non-Performing Assets
(Unaudited)
| | | At December 31, 2012 | At September 30, 2012 | | At December 31, 2011 |
| | | (Dollars in thousands) |
| | | | | |
| Nonaccrual Loans: | | | | | | | | | |
| Commercial | | $ | 5,914 | | $ | 10,545 | | $ | 9,070 |
| Residential Real Estate (1) | | | 3,447 | | | 2,600 | | | 6,968 |
| Consumer | | | -- | | | -- | | | 20 |
| Total Nonaccrual Loans (2) | | | 9,361 | | | 13,145 | | | 16,058 |
| Accruing Troubled Debt Restructurings | | | 5,493 | | | 6,647 | | | 1,133 |
| Total Nonperforming Loans | | | 14,854 | | | 19,792 | | | 17,191 |
| Foreclosed Real Estate | | | 3,370 | | | 1,674 | | | 1,275 |
| Total Nonperforming Assets | | $ | 18,224 | | $ | 21,466 | | $ | 18,466 |
| | | | | | | | | | |
| Nonperforming Loans to Loans Receivable | | | 4.51% | | | 5.90% | | | 4.84% |
| | | | | | | | | | |
| Nonperforming Assets to Total Assets | | | 2.83% | | | 3.33% | | | 2.87% |
| (1) | Includes residential owner occupied properties and residential rental investor properties. |
| (2) | Nonaccrual status denotes loans on which, in the opinion of management, the collection of additional interest is questionable. Also included in this category at December 31, 2012 are $1.0 million in Troubled Debt Restructurings. Reporting guidance requires disclosure of these loans as nonaccrual until the loans have performed according to the modified terms for a sustained period. As of December 31, 2012, the Company had a total of $6.5 million in Troubled Debt Restructurings of which $6.2 million are performing according to their restructured terms. |
