JEFFERSON BANCSHARES, INC. ANNOUNCES EARNINGS FOR THE
THREE AND NINE MONTHS ENDED MARCH 31, 2009
Morristown, Tennessee -- (May 5, 2009) - Jefferson Bancshares, Inc. (NasdaqGM:
JFBI), the holding company for Jefferson Federal Bank, announced net earnings
for the quarter ended March 31, 2009 of $515,000, or $0.09 per diluted share,
compared to net earnings of $495,000, or $0.09 per diluted share, for the
quarter ended March 31, 2008. For the nine months ended March 31, 2009, net
earnings were $1.8 million, or $0.31 per diluted share, compared to $753,000, or
$0.13 per diluted share, for the comparable period in 2008. The 2009 results
reflect the Company's acquisition of State of Franklin Bancshares, Inc., the
parent company of State of Franklin Bank, a Tennessee chartered savings bank
headquartered in Johnson City, Tennessee, (collectively, "State of Franklin") on
October 31, 2008. Costs associated with the acquisition were approximately $11.8
million, consisting of 736,000 shares of Company common stock issued to former
State of Franklin shareholders and $4.9 million in cash.
Financial results for the nine months ended March 31, 2008 include a $637,000
non-cash charge to deferred income tax expense to establish a valuation
allowance against deferred tax assets related to the charitable contribution
carryforward directly attributable to the company's contribution to the
Jefferson Federal Charitable Foundation in July 2003. Excluding this tax charge,
core net earnings were $1.4 million, or $0.24 per diluted share, for the nine
month period ended March 31, 2008. For a reconciliation of core net earnings and
net earnings on a GAAP basis, see the table below.
Anderson L. Smith, President and Chief Executive Officer commented, "Financial
institutions have more challenges ahead due to the struggling economy and
historically low interest rates. We continue to thoroughly review the
performance of our loan portfolio and have strengthened our allowance for loan
losses as a percentage of total loans. Although non-performing assets increased
during the third quarter of fiscal 2009, the Company's asset quality continues
to compare favorably with industry peers."
At March 31, 2009, total assets were $663.1 million compared to $330.3 million
at June 30, 2008. Net loans increased $225.9 million to $508.4 million at March
31, 2009, compared to $282.5 million at June 30, 2008, reflecting the State of
Franklin acquisition. Deposits increased $258.6 million to $482.1 million at
March 31, 2009, due to deposits assumed in connection with the State of Franklin
acquisition. Total shareholders' equity was $78.9 million at March 31, 2009
compared to $72.8 million at June 30, 2008. The increase in stockholders' equity
is primarily due to the issuance of 736,000 shares of common stock related to
the State of Franklin acquisition.
Nonperforming assets increased to 1.21% of total assets at March 31, 2009,
compared to 0.25% of total assets at March 31, 2008, primarily due to an
increase in nonaccrual real estate loans. Net charge-offs for the nine months
ended March 31, 2009 were $178,000, or 0.06% of average loans on an annualized
basis, compared to $521,000, or 0.25% of average loans on an annualized basis,
for the same period in 2008. The allowance for loan losses was $4.8 million, or
0.94% of total gross loans, at March 31, 2009 compared to $1.8 million, or 0.64%
of total gross loans, at March 31, 2008. The provision for loan losses totaled
$610,000 for the nine months ended March 31, 2009, compared to $371,000 for the
nine months ended March 31, 2008. The allowance for loan losses increased $3.0
million during the nine months ended March 31, 2009 due primarily to the
addition of the State of Franklin allowance for loan losses. The increase in the
provision for loan losses was primarily the result of the increase in nonaccrual
real estate loans.
Jefferson Bancshares, Inc. is the holding company for Jefferson Federal Bank, a
Tennessee-chartered savings bank headquartered in Morristown, Tennessee.
Jefferson Federal is a community oriented financial institution offering
traditional financial services with offices in Hamblen, Knox, Washington and
Sullivan Counties, Tennessee. The Company's stock is listed on the NASDAQ Global
Market under the symbol "JFBI." More information about Jefferson Bancshares and
Jefferson Federal Bank can be found at its website: www.jeffersonfederal.com.
------------------------
This press release, as well as other written communications made from time to
time by the Company and its subsidiaries and oral communications made from time
to time by authorized officers of the Company, may contain statements relating
to the future results of the Company (including certain projections and business
trends) that are considered "forward-looking statements" as defined in the
Private Securities Litigation Reform Act of 1995 (the "PSLRA"). Such
forward-looking statements may be identified by the use of such words as
"believe," "expect," "anticipate," "should," "planned," "estimated," "intend"
and "potential." For these statements, the Company claims the protection of the
safe harbor for forward-looking statements contained in the PSLRA.
The Company cautions you that a number of important factors could cause actual
results to differ materially from those currently anticipated in any
forward-looking statement. Such factors include, but are not limited to:
prevailing economic and geopolitical conditions; changes in interest rates, loan
demand, real estate values and competition; changes in accounting principles,
policies and guidelines; changes in any applicable law, rule, regulation or
practice with respect to tax or legal issues; and other economic, competitive,
governmental, regulatory and technological factors affecting the Company's
operations, pricing, products and services and other factors that may be
described in the Company's annual report on Form 10-K and quarterly reports on
Form 10-Q as filed with the Securities and Exchange Commission. The
forward-looking statements are made as of the date of this release, and, except
as may be required by applicable law or regulation, the Company assumes no
obligation to update the forward-looking statements or to update the reasons why
actual results could differ from those projected in the forward-looking
statements.
Nine Months Ended
March 31,
2009 2008
---- ----
(Dollars in thousands,
except per share data)
GAAP net earnings (loss) $ 1,838 $ 753
Plus: non-cash charge to deferred income tax expense $ 0 $ 637
----------- ------------
Core net earnings $ 1,838 $ 1,390
=========== ============
GAAP earnings (loss) per diluted share $ 0.31 $ 0.13
Plus: non-cash charge to deferred income tax expense $ 0.00 $ 0.11
----------- ------------
Core net earnings per diluted share $ 0.31 $ 0.24
=========== ============
JEFFERSON BANCSHARES, INC.
AT AT
MARCH 31, 2009 JUNE 30, 2008
------------------------ --------------------
(Dollars in thousands)
FINANCIAL CONDITION DATA:
Total assets $ 663,113 $ 330,265
Loans receivable, net 508,371 282,483
Cash and cash equivalents, and
interest-bearing deposits 33,264 17,616
Investment securities 36,375 3,478
Deposits 482,117 223,552
Borrowings 90,427 33,000
Stockholders' equity $ 78,932 $ 72,777
THREE MONTHS ENDED MARCH 31, NINE MONTHS ENDED MARCH 31,
2009 2008 2009 2008
------------ ------------- ------------ -------------
(Dollars in thousands, except per share data)
OPERATING DATA:
Interest income $ 8,038 $ 5,198 $ 19,778 $ 16,100
Interest expense 3,476 2,293 8,238 7,338
Net interest income 4,562 2,905 11,540 8,762
Provision for loan losses 300 243 610 371
Net interest income after
provision for loan losses 4,262 2,662 10,930 8,391
Noninterest income 645 378 1,668 1,137
Noninterest expense 4,038 2,290 9,912 7,397
Earnings before income taxes 869 750 2,686 2,131
Total income taxes 354 255 848 1,378
Net earnings $ 515 $ 495 $ 1,838 $ 753
SHARE DATA:
Earnings per share, basic $ 0.09 $ 0.09 $ 0.31 $ 0.13
Earnings per share, diluted $ 0.09 $ 0.09 $ 0.31 $ 0.13
Dividends per share $ 0.06 $ 0.06 $ 0.18 $ 0.18
Book value per common share $ 11.71 $ 11.67 $ 11.71 $ 11.67
Weighted average shares:
Basic 6,265,163 5,763,588 6,006,052 5,828,374
Diluted 6,265,163 5,763,588 6,006,052 5,828,374
THREE MONTHS ENDED MARCH 31, NINE MONTHS ENDED MARCH 31,
2009 2008 2009 2008
------------ ------------- ------------ -------------
(Dollars in thousands)
ALLOWANCE FOR LOAN LOSSES:
Allowance at beginning of period $ 4,692 $ 1,827 $ 1,836 $ 1,955
Allowance of acquired bank 0 -- 2,577 --
Provision for loan losses 300 243 610 371
Recoveries 26 34 68 64
Charge-offs (173) (299) (246) (585)
------------ ------------- ------------- ------------
Net Charge-offs (147) (265) (178) (521)
------------ ------------- ------------- ------------
Allowance at end of period $ 4,845 $ 1,805 $ 4,845 $ 1,805
============ ============= ============= ============
Net charge-offs to average outstanding
loans during the period, annualized 0.12% 0.37% 0.06% 0.25%
AT AT AT
MARCH 31, 2009 JUNE 30, 2008 MARCH 31, 2008
------------------------ -------------------- ----------------------
(Dollars in thousands)
NONPERFORMING ASSETS:
Nonaccrual loans:
Real estate $ 6,246 $ 139 $ 386
Commercial business 161 162 --
Consumer 258 -- --
----------- --------- --------
Total 6,665 301 386
----------- --------- --------
Real estate owned 1,359 462 407
Other nonperforming assets -- 5 33
----------- --------- --------
Total nonperforming assets $ 8,024 $ 768 $ 826
=========== ========= ========
NINE MONTHS ENDED YEAR ENDED
MARCH 31, 2009 JUNE 30, 2008
------------------------ --------------------
PERFORMANCE RATIOS:
Return on average assets 0.48% 0.37%
Return on average equity 3.20% 1.69%
Interest rate spread 3.11% 3.00%
Net interest margin 3.39% 3.73%
Efficiency ratio 75.05% 75.38%
Average interest-earning assets to
average interest-bearing liabilities 111.64% 124.75%
ASSET QUALITY RATIOS:
Allowance for loan losses as a
percent of total gross loans 0.94% 0.65%
Allowance for loan losses as a
percent of nonperforming loans 72.69% 609.97%
Nonperforming loans as a percent
of total loans 1.30% 0.11%
Nonperforming assets as a percent
of total assets 1.21% 0.23%
Contacts:
Jefferson Bancshares, Inc.
Anderson L. Smith, President and Chief Executive Officer
423-586-8421
Jane P. Hutton, Chief Financial Officer
423-586-8421