Exhibit 99.1
101 Main St.
P.O. Box 1628
Lafayette, IN 47902
(765) 742-1064
www.LSBANK.com
| FOR IMMEDIATE RELEASE | For further information contact: |
| | Randolph F. Williams |
| | President/CEO |
| | (765) 742-1064 |
| | Fax: (765) 429-5932 |
LSB Financial Corp. Announces First Quarter Results and Payment of a Cash Dividend
LSB Financial Corp. (NASDAQ:LSBI), the parent company of Lafayette Savings Bank, FSB, today reported earnings for the quarter ended March 31, 2008. Compared to the first quarter of 2007, net income was $515,000, down 33.9%, resulting in diluted earnings per share of $0.33. LSB Financial President & CEO, Randolph F. Williams stated, “The current banking environment is extremely challenging, and I am pleased with our recent growth and positive trends. We are starting to see activity in the real estate market and loans were up $7.1 million, or 2.3%, compared to year-end. Deposits also increased over $8.5 million, or 3.7%, during the quarter.”
Williams continued, “Largely as a result of the Fed cutting short term interest rates, an unprecedented 3.0% in just six months, the net interest margin for the first quarter of 2008 was down 37 basis points to 3.11% when compared to the previous year. This translates to a $424,000 decrease in net interest income. While interest rate changes are out of our control, our managers have done a remarkable job of improving asset quality, growing core deposits, and containing expenses. At quarter end, non-performing loans totaled $8.3 million or 2.69% of total loans, compared to $10.0 million, or 3.32%, at December 31, 2007 and $12.5 million, or 3.97%, one year ago.”
Williams continued, “Despite the fact that Tippecanoe County’s unemployment rate has been increasing since year end, we are seeing signs of an improving economy. Our delinquent loans are at a 19-month low, properties are selling at closer to the appraised values and there has been a slowing in the rate of local foreclosures and bankruptcies. Data from March of this year indicates that Indiana is now 11th in the country in foreclosures, with one out of every 538 households facing foreclosure. Last year Indiana was ranked in the top three.”
The Company also announced that it will pay a quarterly cash dividend of $0.25 per share to shareholders of record as of the close of business on May 9, 2008 with a payment date of June 6, 2008. 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 favorable dividend tax rate.”
The closing market price of LSB stock on May 1, 2006 was $18.00 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, 2008 | | | Year ended December 31, 2007 | |
| | | | | | | |
| Cash and due from banks | | $ | 1,487 | | | $ | 1,644 | |
| Short-term investments | | | 11,852 | | | | 4,846 | |
| Securities available-for-sale | | | 12,992 | | | | 13,221 | |
| Loans held for sale | | | 247 | | | | --- | |
| Net portfolio loans | | | 303,766 | | | | 296,908 | |
| Allowance for loan losses | | | 3,277 | | | | 3,702 | |
| Premises and equipment, net | | | 6,736 | | | | 6,815 | |
| Federal Home Loan Bank stock, at cost | | | 3,997 | | | | 3,997 | |
| Bank owned life insurance | | | 5,671 | | | | 5,613 | |
| Other assets | | | 7,593 | | | | 8,966 | |
| Total assets | | | 354,341 | | | | 342,010 | |
| | | | | | | | | |
| Deposits | | | 240,560 | | | | 232,030 | |
| Advances from Federal Home Loan Bank | | | 77,256 | | | | 74,256 | |
| Other liabilities | | | 2,338 | | | | 1,792 | |
| | | | | | | | | |
| Shareholders’ equity | | | 34,187 | | | | 33,932 | |
| Book value per share | | $ | 21.92 | | | $ | 22.07 | |
| Equity / assets | | | 9.65 | % | | | 9.92 | % |
| Total shares outstanding | | | 1,559,409 | | | | 1,557,968 | |
| | | | | | | | | |
| Asset quality data: | | | | | | | | |
| Non-accruing loans | | $ | 6,592 | | | $ | 9,935 | |
| Loans past due 90 days still on accrual | | | 1,669 | | | | 59 | |
| Other real estate / assets owned | | | 3,291 | | | | 3,944 | |
| Total non-performing assets | | | 11,552 | | | | 13,938 | |
| Non-performing loans / total loans | | | 2.69 | % | | | 3.32 | % |
| Non-performing assets / total assets | | | 3.26 | % | | | 4.08 | % |
| Allowance for loan losses / non-performing loans | | | 39.67 | % | | | 37.04 | % |
| Allowance for loan losses / non-performing assets | | | 28.37 | % | | | 26.56 | % |
| Allowance for loan losses / total loans | | | 1.07 | % | | | 1.23 | % |
| Loans charged off (quarter-to-date and year-to-date, respectively) | | $ | 676 | | | $ | 672 | |
| Recoveries on loans previously charged off | | | 1 | | | | 38 | |
| | | Three months ended March 31, | |
| Selected operating data: | | 2008 | | | 2007 | |
| Total interest income | | $ | 5,421 | | | $ | 5,869 | |
| Total interest expense | | | 2,878 | | | | 2,902 | |
| Net interest income | | | 2,543 | | | | 2,967 | |
| Provision for loan losses | | | 250 | | | | 250 | |
| Net interest income after provision for loan losses | | | 2,293 | | | | 2,717 | |
| Non-interest income: | | | | | | | | |
| Deposit account service charges | | | 396 | | | | 406 | |
| Gain on sale of mortgage loans | | | 16 | | | | 42 | |
| Gain on sale of securities | | | 0 | | | | 0 | |
| Net gain on sale of real estate owned | | | 91 | | | | 0 | |
| Other non-interest income | | | 279 | | | | 252 | |
| Total non-interest income | | | 782 | | | | 700 | |
| Non-interest expense: | | | | | | | | |
| Salaries and benefits | | | 1,227 | | | | 1,190 | |
| Occupancy and equipment, net | | | 344 | | | | 314 | |
| Computer service | | | 135 | | | | 121 | |
| Advertising | | | 69 | | | | 41 | |
| Other | | | 558 | | | | 523 | |
| Total non-interest expense | | | 2,333 | | | | 2,189 | |
| Income before income taxes | | | 742 | | | | 1,228 | |
| Income tax expense | | | 227 | | | | 449 | |
| Net income | | | 515 | | | | 779 | |
| | | | | | | | | |
| Weighted average number of diluted shares | | | 1,560,997 | | | | 1,612,091 | |
| Diluted earnings per share | | $ | 0.33 | | | $ | 0.48 | |
| | | | | | | | | |
| Return on average equity | | | 6.03 | % | | | 8.87 | % |
| Return on average assets | | | 0.59 | % | | | 0.86 | % |
| Average earning assets | | $ | 327,333 | | | $ | 341,323 | |
| Net interest margin | | | 3.11 | % | | | 3.48 | % |
| Efficiency ratio | | | 75.87 | % | | | 64.06 | % |
