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
May 13, 2011, Lafayette, IN - LSB Financial Corp. (NASDAQ:LSBI), the parent company of Lafayette Savings Bank, FSB, today reported quarterly earnings of $205,000 or $0.13 diluted earnings per share compared to $532,000 or $0.34 diluted earnings per share a year earlier. The major contributor to the bank’s performance, net interest income, was up $416,000, a 14% improvement over last year. Interest income totaled $4.5 million while interest expense decreased to $1.1 million resulting in net interest income of $3.4 million compared to last year’s level of $2.9 million. Randolph F. Williams, president and CEO stated, “Pre-tax, pre-provision (“PTPP”) income continues to be strong and indicates that the core performance of the bank is robust. This quarter’s PTPP income was up 48% from the first quarter of 2008 at the beginning of the recession, up 50% from the first quarter of 2009 and up 19% from the first quarter of 2010.”
The major offsetting factor to income was the loan loss provision of $1,176,000 in the first quarter, compared to a provision of $434,000 in the same quarter last year. The main reason for the increase was the addition of specific reserves on impaired loans due to circumstances arising in the quarter that affected our evaluation of the credits. This substantial provision brings the loan loss reserve to $6.5 million, up from $4.1 million at March 31, 2010 and now stands at 2.03% of total loans. At quarter end, non-performing assets totaled $19.8 million or 5.44% of total assets, compared to $19.3 million or 5.18%, at the end of 2010. Williams continued, “We believe it is important as we continue to work with our borrowers that we also prudently set aside reserves. The $19.8 million of non-performing assets includes $6.2 million or 32.4% of loans where the borrower has been able to resume payments but because of regulatory guidelines must remain categorized as non-performing for at least six months to show a pattern of performance. This quarter we were able to upgrade several loans from this status and expect to see more progress in the coming quarters. The loan loss reserve now stands at 33.1% of the non-performing assets. The level of OREO (other real estate owned) is $1.0 million, an improvement from $1.2 million at year-end.”
The bank continues to maintain a strong capital base with a capital-to-asset ratio at March 31, 2011 of 9.84% and a risk-based capital ratio of 14.13%, both of which are well above the current definition of “well-capitalized” as defined by the bank regulators. Capital increased by nearly 4.75% since last year as the bank increased capital and reduced our asset size, thereby improving our leverage. Once the new capital requirements mandated under the Dodd-Frank Act become known, we will be better able to set our longer term capital targets.
The closing market price of LSB stock on May 12, 2011 was $15.67 per share as reported by the Nasdaq Global 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, 2011 | | | Year ended December 31, 2010 | |
| | | | | | | |
| Cash and due from banks | | $ | 8,495 | | | $ | 10,593 | |
| Short-term investments | | | 4,166 | | | | 2,980 | |
| Securities available-for-sale | | | 11,994 | | | | 11,805 | |
| Loans held for sale | | | 489 | | | | 2,265 | |
| Net portfolio loans | | | 315,630 | | | | 320,810 | |
| Allowance for loan losses | | | 6,547 | | | | 5,343 | |
| Premises and equipment, net | | | 6,099 | | | | 6,116 | |
| Federal Home Loan Bank stock, at cost | | | 3,583 | | | | 3,583 | |
| Bank owned life insurance | | | 6,306 | | | | 6,264 | |
| Other assets | | | 7,015 | | | | 7,431 | |
| Total assets | | | 363,777 | | | | 371,847 | |
| | | | | | | | | |
| Deposits | | | 304,929 | | | | 311,458 | |
| Advances from Federal Home Loan Bank | | | 20,500 | | | | 22,500 | |
| Other liabilities | | | 2,543 | | | | 2,312 | |
| | | | | | | | | |
| Shareholders’ equity | | | 35,805 | | | | 35,577 | |
| Book value per share | | $ | 23.05 | | | $ | 22.90 | |
| Equity / assets | | | 9.84 | % | | | 9.57 | % |
| Total shares outstanding | | | 1,553,525 | | | | 1,553,525 | |
| | | | | | | | | |
| Asset quality data: | | | | | | | | |
| Non-accruing loans | | $ | 18,757 | | | $ | 17,370 | |
| Loans past due 90 days still on accrual | | | --- | | | | 676 | |
| Other real estate / assets owned | | | 1,024 | | | | 1,214 | |
| Total non-performing assets | | | 19,781 | | | | 19,260 | |
| Non-performing loans / total loans | | | 5.81 | % | | | 5.50 | % |
| Non-performing assets / total assets | | | 5.44 | % | | | 5.18 | % |
| Allowance for loan losses / non-performing loans | | | 34.90 | % | | | 29.61 | % |
| Allowance for loan losses / non-performing assets | | | 33.10 | % | | | 27.74 | % |
| Allowance for loan losses / total loans | | | 2.03 | % | | | 1.65 | % |
| Loans charged off (quarter-to-date and year-to-date, respectively) | | $ | 9 | | | $ | 1,382 | |
| Recoveries on loans previously charged off | | | 37 | | | | 229 | |
| | | Three months ended March 31, | |
| Selected operating data: | | 2011 | | | 2010 | |
| | | | | | | |
| Total interest income | | $ | 4,475 | | | $ | 4,671 | |
| Total interest expense | | | 1,111 | | | | 1,723 | |
| Net interest income | | | 3,364 | | | | 2,948 | |
| Provision for loan losses | | | 1,176 | | | | 434 | |
| Net interest income after provision for loan losses | | | 2,188 | | | | 2,514 | |
| Non-interest income: | | | | | | | | |
| Deposit account service charges | | | 292 | | | | 367 | |
| Gain on sale of mortgage loans | | | 164 | | | | 85 | |
| Net (loss) on sale of real estate owned | | | (24 | ) | | | (33 | ) |
| Other non-interest income | | | 260 | | | | 275 | |
| Total non-interest income | | | 692 | | | | 694 | |
| Non-interest expense: | | | | | | | | |
| Salaries and benefits | | | 1,410 | | | | 1,292 | |
| Occupancy and equipment, net | | | 329 | | | | 339 | |
| Computer service | | | 142 | | | | 127 | |
| Advertising | | | 58 | | | | 56 | |
| Other | | | 650 | | | | 599 | |
| Total non-interest expense | | | 2,589 | | | | 2,413 | |
| Income before income taxes | | | 291 | | | | 795 | |
| Income tax expense | | | 86 | | | | 263 | |
| Net income | | | 205 | | | | 532 | |
| | | | | | | | | |
| Weighted average number of diluted shares | | | 1,556,240 | | | | 1,553,535 | |
| Diluted earnings per share | | $ | 0.13 | | | $ | 0.34 | |
| | | | | | | | | |
| Return on average equity | | | 2.29 | % | | | 6.23 | % |
| Return on average assets | | | 0.22 | % | | | 0.57 | % |
| Average earning assets | | $ | 339,878 | | | $ | 341,481 | |
| Net interest margin | | | 3.96 | % | | | 3.45 | % |
| Efficiency ratio | | | 89.90 | % | | | 75.22 | % |
