101 Main St.
P.O. Box 1628
Lafayette, IN 47902
(765) 742-1064
www.LSBANK.com
lsbmail@LSBANK.com
FOR IMMEDIATE RELEASE | FOR FURTHER INFORMATION CONTACT: |
May 2, 2007 | Randolph F. Williams President/CEO (765) 742-1064 Fax: (765) 429-5932 |
LSB Financial Corp. Announces First Quarter Results
LSB Financial Corp. (NASDAQ:LSBI), the parent company of Lafayette Savings Bank, FSB, today reported earnings for the quarter ended March 31, 2007. Net income decreased $129,000 or 14.2% for the first quarter of 2007 from the first quarter of 2006, resulting in diluted earnings per share of $0.48. LSB Financial President & CEO, Randolph F. Williams stated, “This market presents quite a challenge with increased competition, high consumer delinquency and an inverted yield curve. Our management team has done a great job of containing costs and generating non-interest income to help meet the challenge.”
For the first quarter of 2007, the net interest margin was down four basis points to 3.48% when compared to the previous year. This decrease in margin resulted in $154,000 less in net interest income. Additionally, the Bank increased the provision for loan losses to $250,000, up 67% from last year’s level of $150,000. Non-interest expenses were down $27,000 and non-interest income was up $38,000 for the quarter. At quarter end, non-performing loans stood at $11.2 million or 3.97% of total loans, with over 96% of those loans collateralized by real estate property.
Williams continued, “While we see signs of an improving economy, loan demand remains weak. We are encouraged by the recent Manpower Inc. survey which showed that 57% of local companies surveyed planned to hire more people in the April-June time frame. Tippecanoe County’s unemployment rate stood at 4.2% in March compared to 4.7% in March of 2006. We believe that Lafayette Savings Bank’s 138-year presence in Greater Lafayette, its knowledge of the community and its commitment to providing excellent service to its customers will serve us well in these challenging times and provide a consistent return to our shareholders.”
The Company also announced that it will pay a quarterly cash dividend of $0.20 per share to shareholders of record as of the close of business on May 4, 2007 with a payment date of June 1, 2007. Williams stated, “At slower growth times like this, we are pleased to be able to return equity to our shareholders in the form of a higher dividend. This is particularly significant based on the current dividend tax rate.”
The closing market price of LSB stock on April 30, 2007 was $26.00 per share as reported by the NASDAQ National Market.
LSB FINANCIAL CORP. SELECTED CONSOLIDATED FINANCIAL INFORMATION (Dollars in thousands except share and per share amounts) | |
Selected balance sheet data: | | Three months ended March 31, 2007 | | Year ended December 31, 2006 | |
| | | | | | |
| Cash and due from banks | | $ | 1,511 | | $ | 1,391 | |
| Short-term investments | | | 7,708 | | | 8,336 | |
| Securities available-for-sale | | | 14,407 | | | 16,316 | |
| Loans held for sale | | | 801 | | | 992 | |
| Net portfolio loans | | | 311,599 | | | 316,699 | |
| Allowance for loan losses | | | 2,876 | | | 2,770 | |
| Premises and equipment, net | | | 6,891 | | | 6,600 | |
| Federal Home Loan Bank stock, at cost | | | 3,997 | | | 3,997 | |
| Bank owned life insurance | | | 5,438 | | | 5,381 | |
| Other assets | | | 9,269 | | | 8,688 | |
| Total assets | | | 361,621 | | | 368,400 | |
| | | | | | | | |
| Deposits | | | 254,151 | | | 255,304 | |
| Advances from Federal Home Loan Bank | | | 70,118 | | | 76,618 | |
| Other liabilities | | | 2,124 | | | 1,638 | |
| | | | | | | | |
| Shareholders’ equity | | | 35,228 | | | 34,840 | |
| Book value per share | | $ | 22.07 | | $ | 21.73 | |
| Equity / assets | | | 9.74 | % | | 9.46 | % |
| Total shares outstanding | | | 1,595,999 | | | 1,603,209 | |
| | | | | | | | |
| Asset quality data: | | | | | | | |
| Non-accruing loans | | $ | 11,192 | | $ | 7,364 | |
| Loans past due 90 days still on accrual | | | 1,331 | | | 147 | |
| Other real estate / assets owned | | | 4,691 | | | 4,169 | |
| Total non-performing assets | | | 17,214 | | | 11,680 | |
| Non-performing loans / total loans | | | 3.97 | % | | 2.34 | % |
| Non-performing assets / total assets | | | 4.76 | % | | 3.17 | % |
| Allowance for loan losses / non-performing loans | | | 22.97 | % | | 36.88 | % |
| Allowance for loan losses / non-performing assets | | | 16.71 | % | | 23.72 | % |
| Allowance for loan losses / total loans | | | 0.91 | % | | 0.86 | % |
| Loans charged off (quarter-to-date and year-to-date, respectively) | | $ | 153 | | $ | 1,149 | |
| Recoveries on loans previously charged off | | | 9 | | | 49 | |
| | Three months ended March 31, |
| Selected operating data: | | | 2007 | | | 2006 | |
| Total interest income | | $ | 5,869 | | $ | 5,786 | |
| Total interest expense | | | 2,902 | | | 2,665 | |
| Net interest income | | | 2,967 | | | 3,121 | |
| Provision for loan losses | | | 250 | | | 150 | |
| Net interest income after provision for loan losses | | | 2,717 | | | 2,971 | |
| Non-interest income: | | | | | | | |
| Deposit account service charges | | | 406 | | | 424 | |
| Gain on sale of mortgage loans | | | 42 | | | 51 | |
| Gain on sale of securities | | | 0 | | | 0 | |
| Other non-interest income | | | 252 | | | 187 | |
| Total non-interest income | | | 700 | | | 662 | |
| Non-interest expense: | | | | | | | |
| Salaries and benefits | | | 1,190 | | | 1,287 | |
| Occupancy and equipment, net | | | 314 | | | 290 | |
| Computer service | | | 121 | | | 98 | |
| Advertising | | | 41 | | | 58 | |
| Other | | | 523 | | | 483 | |
| Total non-interest expense | | | 2,189 | | | 2,216 | |
| Income before income taxes | | | 1,228 | | | 1,417 | |
| Income tax expense | | | 449 | | | 509 | |
| Net income | | | 779 | | | 908 | |
| | | | | | | | |
| Weighted average number of diluted shares | | | 1,612,091 | | | 1,629,588 | |
| Diluted earnings per share | | $ | 0.48 | | $ | 0.56 | |
| | | | | | | | |
| Return on average equity | | | 8.87 | % | | 10.90 | % |
| Return on average assets | | | 0.86 | % | | 0.97 | % |
| Average earning assets | | $ | 341,323 | | $ | 354,734 | |
| Net interest margin | | | 3.48 | % | | 3.52 | % |
| Efficiency ratio | | | 64.06 | % | | 61.00 | % |
