Exhibit 99.1
FOR IMMEDIATE RELEASE
For further information contact:
Donald A. Williams, Chairman & CEO
Michael J. Janosco Jr., CFO
413-568-1911
Westfield Financial, Inc. Declares Dividend and Reports Results
for the Quarter Ended June 30, 2007
Westfield, Massachusetts, July 18, 2007: (AMEX:WFD) Westfield Financial, Inc.
(the "Company"), the holding company for Westfield Bank (the "Bank"), reported
net income of $1.9 million for the quarter ended June 30, 2007 compared to $1.3
million for the same period in 2006. This represents earnings of $0.06 per
diluted share for the quarter ended June 30, 2007, compared to $0.04 per
diluted share for the same period in 2006.
The increase in earnings was primarily the result of an increase in net
interest income. Net interest income was $7.4 million for the three months
ended June 30, 2007 and $5.9 million for the same period in 2006. The increase
in net interest income was mainly due to a $163.8 million increase in average
earning assets as a result of funds raised in the second step stock offering.
The net interest margin, on a tax equivalent basis, was 3.25% for the three
months ended June 30, 2007, compared to 3.19% for the same period in 2006.
Noninterest expense for the three months ended June 30, 2007 was $5.6 million,
compared to $4.9 million for the same period in 2006. Salaries and benefits
increased $301,000 as a result of hiring new employees and normal increases in
expenses related to employee salaries and benefits. Much of the new hiring was
associated with a new Westfield Bank branch which opened for business during
the second quarter of 2007.
Advertising and marketing expense increased $137,000 for the three months ended
June 30, 2007 compared to the same period in 2006. Also, charitable
contributions increased $93,000 for the three months ended June 30, 2007
compared to the same period in 2006. For advertising and marketing expense, as
well as charitable contributions, management authorized a larger portion of the
anticipated annual expenditures in the three months ended June 30, 2007.
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Dividend Declaration
Donald A. Williams, Chairman and Chief Executive Officer stated, "On July 17,
2007, the Board of Directors declared a regular cash dividend of $0.05 per
share, payable on August 23, 2007, to all shareholders of record on August 9,
2007."
Balance Sheet Growth
Total assets increased $34.8 million to over $1.0 billion at June 30, 2007 from
$996.8 million at December 31, 2006.
Investment securities increased $80.1 million, to $489.1 million at June 30,
2007 from $409.0 million at December 31, 2006. Investment securities increased
as Management invested the proceeds of the second step stock offering. Cash and
cash equivalents decreased $69.4 million, to $85.1 million at June 30, 2007
from $154.5 million at December 31, 2006. The decrease in cash and cash
equivalents is the result of using funds to purchase investment securities.
Net loans increased by $9.5 million, to $394.7 million at June 30, 2007 from
$385.2 million at December 31, 2006. This was primarily the result of an
increase of $14.2 million in commercial and industrial loans, which were $114.6
million at June 30, 2007 and $100.4 million at December 31, 2006. Commercial
real estate loans decreased $1.6 million, to $172.8 million at June 30, 2007
from $174.5 million at December 31, 2006. This was primarily due to a single
commercial relationship that divested real estate holdings and paid off loans
totaling $10.2 million. This was partially offset by new commercial loan
originations.
James Hagan, President and COO, stated "While the balance in our commercial and
industrial loan portfolio held steady in 2006, we are pleased with the growth
in these loans during the first half of 2007. Our strategy emphasizes
commercial relationships and I feel that Westfield Bank has built a good
platform from which to grow."
Asset growth was funded primarily through a $25.0 million increase in Federal
Home Loan Bank borrowings, which totaled $80.0 million at June 30, 2007. In
addition, customer repurchase agreements increased $2.4 million to $20.3
million at June 30, 2007 from $17.9 million at December 31, 2006. All of
Westfield Bank's customer repurchase agreements at June 30, 2007 were held by
commercial customers. Total deposits increased $2.8 million to $630.3 million
at June 30, 2007 from $627.5 million at December 31, 2006.
Stockholders' equity at June 30, 2007 and December 31, 2006 was $293.3 million
and $289.4 million, respectively, which represented 28.4% of total assets as of
June 30, 2007 and 29.0% of total assets as of December 31, 2006.
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Credit Quality
Nonperforming loans were $1.0 million at both June 30, 2007 and December 31,
2006. This represents 0.25% of total loans at June 30, 2007 and 0.26% of total
loans at December 31, 2006.
The allowance for loan losses was $5.7 million at June 30, 2007 and $5.4
million at December 31, 2006. This represents 1.42% of total loans at June 30,
2007 and 1.39% of total loans at December 31, 2006. At these levels, the
allowance for loan losses as a percentage of nonperforming loans was 563% at
June 30, 2007 and 529% at December 31, 2006.
The Bank is headquartered in Westfield, Massachusetts and operates through 11
banking offices in Agawam, East Longmeadow, Holyoke, Southwick, Springfield,
West Springfield and Westfield, Massachusetts. The Bank's deposits are insured
by the Federal Deposit Insurance Corporation.
The Company wishes to caution readers not to place undue reliance on any such
forward-looking statements contained in this news release, which speak only as
of the date made. The Company wishes to advise readers that the factors listed
above could affect the Company's financial performance and could cause the
Company's actual results for future periods to differ materially from any
opinions or statements expressed with respect to future periods in any current
statements. The Company and the Bank do not undertake and specifically decline
any obligation to publicly release the result of any revisions that may be made
to any forward-looking statements to reflect events or circumstances after the
date of such statements or to reflect the occurrence of anticipated or
unanticipated events.
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WESTFIELD FINANCIAL, INC. and SUBSIDIARIES
Selected Consolidated Statement of Operations and Other Data
($ in thousands, except per share data)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2007 2006 2007 2006
---- ---- ---- ----
Interest and dividend income $ 13,059 $ 10,613 $ 25,903 $ 20,542
Interest expense 5,646 4,702 10,969 8,852
----------- ----------- ----------- -----------
Net interest and dividend income 7,413 5,911 14,934 11,690
Provision for loan losses 75 200 175 275
----------- ----------- ----------- -----------
Net interest and dividend income after
provision for loan losses 7,338 5,711 14,759 11,415
Noninterest income 974 883 1,793 1,736
Noninterest expense 5,581 4,904 10,887 9,698
----------- ----------- ----------- -----------
Income before income taxes 2,731 1,690 5,665 3,453
Income taxes 826 430 1,740 879
----------- ----------- ----------- -----------
Net income $ 1,905 $ 1,260 $ 3,925 $ 2,574
=========== =========== =========== ===========
Basic earnings per share (1) $ 0.06 $ 0.04 $ 0.13 $ 0.08
Average shares outstanding (1) 30,120,536 30,547,810 30,107,957 30,544,387
Diluted earnings per share (1) $ 0.06 $ 0.04 $ 0.13 $ 0.08
Diluted average shares outstanding (1) 30,575,244 31,103,863 30,625,328 31,103,797
Other Data:
Return on Average Assets (2) 0.77% 0.62% 0.80% 0.64%
Return on Average Equity (2) 2.61% 4.41% 2.71% 4.52%
Net Interest Margin (3) 3.25% 3.19% 3.31% 3.19%
(1) Per share amounts related to periods prior to the date of completion of the conversion (January
3, 2007) have been restated to give retroactive recognition to the exchange ratio applied in
the conversion.
(2) Three and six month results have been annualized.
(3) Net interest margin is calculated on a tax equivalent basis.
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WESTFIELD FINANCIAL, INC. and SUBSIDIARIES
Selected Consolidated Balance Sheet and Other Data
($ in thousands, except per share data)
(Unaudited)
June 30 December 31
2007 2006
---- ----
Total assets $1,031,629 $996,829
Securities held to maturity 263,129 240,392
Securities available for sale 225,961 168,629
Stock in Federal Home Loan Bank of Boston 5,575 4,246
Loans 400,400 390,621
Allowance for loan losses 5,674 5,437
---------- --------
Net loans 394,726 385,184
Total deposits 630,268 627,466
Federal Home Loan Bank advances 80,000 55,000
Customer repurchase agreements 20,279 17,919
Stockholders' equity 293,285 289,408
Book value per share 9.19 9.07
Other Data:
Nonperforming loans $ 1,007 $ 1,028
Nonperforming loans as a percentage
of total assets 0.10% 0.10%
Nonperforming loans as a percentage
of total loans 0.25% 0.26%
Allowance for loan losses as a percentage
of nonperforming loans 563% 529%
Allowance for loan losses as a percentage
of total loans 1.42% 1.39%
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