Exhibit 99.1
FOR IMMEDIATE RELEASE
October 15, 2003
FOR ADDITIONAL INFORMATION
CONTACT: RANDY J. SIZEMORE
SR VICE PRESIDENT, CFO
(260) 358-4680
NORTHEAST INDIANA BANCORP, INC.
ANNOUNCES THIRD QUARTER EARNINGS
HUNTINGTON, INDIANA, -- Northeast Indiana Bancorp, Inc. (NEIB), the parent
company of First Federal Savings Bank, today announced net income of $395,000
($0.28 per diluted common share) for the Company's third quarter ended September
30, 2003 compared to net income of $430,000 ($0.30 per diluted common share) for
the third quarter ended September 30, 2002, a decrease in net income of $35,000
or 8.1%. The current three months earnings represents an annualized return on
average assets (ROA) of 0.72% and a return on average equity (ROE) of 5.96% as
compared to an ROA of 0.77% and an ROE of 6.48% for the three months ended
September 30, 2002.
Net interest income declined to $1.4 million for the quarter ended September 30,
2003 when compared to $1.6 million for the quarter ended September 30, 2002.
This decrease was primarily due to the loss of asset yields on loans and
mortgage-related investments from the high level of mortgage refinancing that
occurred during the second and third quarter of 2003. This was further evidenced
in the Company's net interest margin of 2.69% for the current quarter, a decline
from the net interest margin of 3.04% in the year earlier period.
For the third consecutive quarter, Northeast Indiana Bancorp, Inc. saw
significant improvement in non-performing asset trends. The Company's
non-performing assets were $3.5 million or 1.6% of total assets at September 30,
2003, a decline of 47.8% from the $6.7 million or 3.0% of total assets reported
at December 31, 2002 and a 16.7% decline from the $4.2 million or 1.9% of total
assets reported at June 30, 2003. In addition, net charge-offs were $2,000 for
the quarter ended September 30, 2003 compared to $145,000 in net charge-offs for
the quarter ended September 30, 2002. These trends enabled the Company to make
no provisions for loan losses during the current quarter versus $190,000 in the
year earlier quarter.
Noninterest income increased 7.0% to $353,000 for the third quarter ended
September 30, 2003 compared to $330,000 during the quarter ended September 30,
2002. Declines in net gain on the sale of loans and Trust/Brokerage fees were
more than offset by increases in service charges on deposit accounts, net gains
on sale of securities, other income and smaller net losses on the sale of
repossessed assets.
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Noninterest expenses were relatively unchanged between periods. Increases in
data processing were offset by declines in salaries, occupancy, deposit
insurance premiums, professional fees, and other expenses as management
continued to focus on cost containment where possible.
Net income for the nine months ended September 30, 2003 increased $401,000 or
36.2% to $1.5 million compared to $1.1 million for the nine months ended
September 30, 2002. This significant increase is primarily due to no provisions
for loan losses in the current nine month period compared to $582,000 in
provisions for loan losses in the prior nine month period and a sharp increase
in noninterest income between periods mainly attributable to gains on the sale
of loans. Both of these items were more than enough to offset a decline in net
interest income of $438,000 to $4.4 million for the nine months ending September
30, 2003 compared to $4.8 million for the nine months ending September 30, 2002.
Noninterest expenses were relatively unchanged between periods.
Total assets at September 30, 2003 of $221.5 million compared to December 31,
2002 assets of $225.0 million reflects a 1.6% decrease. Asset reduction at
September 30, 2003 compared to December 31, 2002 was due to an advance being
repaid to the Federal Home Loan Bank and excess funds being held in repurchase
agreements at the prior year end flowing out. Cash and cash equivalents were
used to fund both outflows.
Shareholder's equity at September 30, 2003 was $27.1 million compared to $26.6
million at December 31, 2002. The company repurchased no common shares of
treasury stock during the quarter ended September 30, 2003. Northeast Indiana
Bancorp still has approximately 55,000 shares that may be repurchased under the
current stock repurchase program, which was previously announced.
The book value of NEIB's stock was $18.41 per common share as of September 30,
2003. The number of outstanding common shares was 1,472,944. The last reported
trade of the stock on October 10, 2003 was $18.39 per common share. This
represents a 16.4% increase over the closing price of $15.80 per common share on
December 31, 2002.
Northeast Indiana Bancorp, Inc. is headquartered at 648 North Jefferson Street,
Huntington, Indiana. The company offers a full array of banking, trust, and
financial brokerage services to its customers through three full service
branches located in Huntington, Indiana. The company is traded on The NASDAQ
Stock Market under the symbol "NEIB".
This press release may contain forward-looking statements, which are based on
management's current expectations regarding economic, legislative and regulatory
issues. Factors which may cause future results to vary materially include, but
are not limited to, general economic conditions, changes in interest rates, loan
demand, and competition. Additional factors include changes in accounting
principles, policies or guidelines; changes in legislation or regulation; and
other economic, competitive, regulatory and technological factors affecting each
company's operations, pricing, products and services.
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NORTHEAST INDIANA BANCORP
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
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CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
ASSETS September 30, December 31,
2003 2002
Interest-earning cash and cash equivalents $ 6,429,253 $15,195,326
Noninterest earning cash and cash equivalents 708,461 3,061,082
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Total cash and cash equivalents 7,137,714 18,256,408
Securities available for sale 49,127,744 42,838,211
Securities held to maturity estimated market value of $150,000 and $225,000 at September 30, 2003
and December 31, 2002 150,000 225,000
Loans held for sale 150,850 409,375
Loans receivable, net of allowance for loan loss September 30, 2003 $1,856,347 and December 31, 2002
$ 2,135,630 154,510,694 154,559,565
Accrued interest receivable 819,936 694,593
Premises and equipment 2,091,562 2,176,356
Investments in limited liability partnerships 1,659,954 1,833,375
Cash surrender value of life insurance 4,208,969 2,082,890
Other assets 1,626,464 1,943,142
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Total Assets $221,483,887 $225,018,915
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LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits 122,431,845 122,356,652
Borrowed Funds 70,220,256 74,893,922
Accrued interest payable and other liabilities 1,709,923 1,205,856
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Total Liabilities 194,362,024 198,456,430
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Retained earnings - substantially restricted 27,121,863 26,562,485
-------------------------------
Total Liabilities and Shareholder's Equity $221,483,887 $225,018,915
===============================
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CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended Nine Months Ended
September 30, September 30,
2003 2002 2003 2002
---- ---- ---- ----
Total interest income $ 2,997,728 $ 3,562,600 $ 9,380,905 $ 10,945,676
Total interest expense 1,599,978 1,934,491 5,013,744 6,140,110
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Net interest income $ 1,397,750 $ 1,628,109 $ 4,367,161 $ 4,805,566
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Provision for loan losses -- 190,000 -- 582,300
Net interest income after provision for
Loan losses $ 1,397,750 $ 1,438,109 $ 4,367,161 $ 4,223,266
Service charges on deposit account 94,669 88,423 272,788 262,273
Net gain (loss) on sale of securities 12,397 -- 12,397 (10,535)
Net gain on sale of loans 52,095 106,887 477,215 179,094
Net gain (loss) on sale of repossessed assets (5,829) (37,782) 57,033 (100,070)
Trust and brokerage fees 31,989 56,149 134,202 172,415
Other income 167,741 116,094 480,963 377,022
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Total noninterest income $ 353,062 $ 329,771 $ 1,434,598 $ 880,199
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Salaries and employee benefits * 653,916 659,701 1,931,281 1,951,108
Occupancy 111,459 115,585 358,642 346,899
Data processing 175,808 148,330 512,135 457,864
Deposit insurance premiums 5,001 5,738 15,072 18,209
Professional fees 50,948 57,500 197,953 195,889
Correspondent bank charges 55,540 59,398 155,314 166,899
Other expense * 172,216 195,348 570,279 559,969
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Total noninterest expenses $ 1,224,888 $ 1,241,600 $ 3,740,676 $ 3,696,837
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Income before income tax expenses $ 525,924 $ 526,280 $ 2,061,083 $ 1,406,628
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Income tax expenses 130,728 95,868 552,628 299,106
Net Income $ 395,196 $ 430,412 $ 1,508,455 $ 1,107,522
=========================================================================================================================
* - Certain prior year line items were reclassified to conform with current
year presentations.
NORTHEAST INDIANA BANCORP
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
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Three Months Ended Nine Months Ended
September 30, September 30,
2003 2002 2003 2002
---- ---- ---- ----
Basic Earnings per common share 0.28 0.30 1.06 0.76
Dilutive Earnings per share 0.28 0.30 1.02 0.74
Net interest margin 2.69% 3.04% 2.77% 2.91%
Return on average assets 0.72% 0.77% 0.91% 0.64%
Return on average equity 5.96% 6.48% 7.56% 5.58%
Average shares outstanding- primary 1,410,934 1,438,787 1,419,016 1,452,981
Average shares outstanding- diluted 1,432,864 1,454,882 1,476,235 1,494,661
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Allowance for loan losses:
Balance at beginning of period $1,857,963 $2,067,072 $2,135,630 $1,954,900
Charge-offs:
One-to-four family -- -- 25,954 --
Commercial real estate 34,343 -- 235,722 61,400
Commercial -- -- 100,488 --
Consumer 30,323 193,333 171,188 543,887
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Gross charge-offs 64,666 193,333 533,352 605,287
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Recoveries:
One-to-four family -- -- --
Commercial real estate -- -- --
Commercial -- -- 96,000 10,493
Consumer 63,050 47,968 158,069 169,301
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Gross recoveries 63,050 47,968 254,069 179,794
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Net charge-offs (recoveries) 1,616 145,365 279,283 425,493
Additions charged to operations -- 190,000 -- 582,300
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Balance at end of period $1,856,347 $2,111,707 $1,856,347 $2,111,707
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Net loan charge-offs (recoveries) to average loans (1) 0.00% 0.35% 0.24% 0.34%
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Nonperforming assets (000's) At September 30, At September 30, At June 30, At December 31,
Loans: 2003 2002 2003 2002
------ ---- ---- ---- ----
Non-accrual $ 3,231 $ 6,655 $ 3,845 $ 6,218
Past 90 days or more and still accruing - - - -
Troubled debt restructured - - - -
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Total nonperforming loans 3,231 6,655 3,845 6,218
Real estate owned 218 160 370 516
Other repossessed assets 11 50 14 12
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Total nonperforming assets $ 3,460 $ 6,865 $ 4,229 $ 6,746
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Nonperforming assets to total assets 1.56% 3.08% 1.92% 3.00%
Nonperforming loans to total loans 2.07% 4.16% 2.53% 3.97%
Allowance for loan losses to nonperforming loans 57.44% 31.74% 48.30% 34.35%
Allowance for loan losses to net loans receivable 1.19% 1.32% 1.22% 1.36%
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At September 30,
2003 2002
---- ----
Stockholders' equity as a % of total assets 12.25% 11.81%
Book value per share $ 18.41 $ 17.42
Common shares outstanding- EOP 1,472,944 1,511,943
(1) Ratios for the three-month periods are annualized.