Exhibit 99.1
Press Release FOR IMMEDIATE RELEASE
Contact: Frederick A. Marcell Jr., CEO
Christopher E. Bell, CFO
Telephone: 215-646-5405
WILLOW GROVE BANCORP, INC. ANNOUNCES
FOURTH QUARTER AND YEAR-END RESULTS,
DIVIDEND DECLARATION, AND NEW SHARE REPURCHASE PROGRAM
Maple Glen, Pennsylvania - (July 25, 2001) Willow Grove Bancorp, Inc.
(the "Company") (Nasdaq/NMS: WGBC), the holding company for Willow Grove Bank
(the "Bank"), reported net income of $813,000, or $.16 diluted earnings per
share for the quarter ended June 30, 2001 compared to net income of $1.2
million or $.25 diluted earnings per share for the quarter ended June 30,
2000. Net income for the fiscal year ended June 30, 2001 was $157,000 or $.03
diluted earnings per share compared to net income of $4.8 million, or $.97
diluted earnings per share for the comparable prior fiscal year. As described
below, the Company's results for the fourth quarter and fiscal year were
negatively affected by two commercial business loans which were placed on
non-accrual status during the year.
President Marcell stated, "in spite of these recent loan challenges, we
are encouraged by this quarter's profitability. Excluding the effect of the
aforementioned challenges, net income for the fiscal year would have been $4.8
million. The Bank continues to have capital well in excess of regulatory
requirements." He also stated, "it is our intention, as we put these loan
problems behind us, to resume our focus on the successful implementation of
our current business plan which calls for continued expansion and increased
profitability as we serve the needs of our customers in the Delaware Valley
region of Pennsylvania."
Net interest income for the three-month and twelve-month periods ended
June 30, 2001 was $5.2 million and $20.1 million, respectively. This compares
to $5.2 million and $19.5 million in net interest income for the respective
prior comparable periods. Net interest income remained steady primarily as a
result of increased average balances on interest-earning assets. However, for
the three months ended June 30, 2001, primarily due to a 34 basis point
reduction on the average rates earned on interest-earning assets, combined
with a slight increase in the average rate of interest paid on
interest-bearing liabilities, the Company's net interest margin declined by 40
basis points from the comparable prior year period. While for the twelve
months ended June 30, 2001, greater increases on average rates paid on
interest-bearing liabilities compared to the average rates earned on
interest-earning assets were a primary factor in a reduction in the Company's
net interest margin of 37 basis points compared to the prior year. However,
based on recent Federal Reserve Board interest rate reductions, the Company is
anticipating a reversal in margin decline.
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The Company's provision for loan loss for the three-month period ended
June 30, 2001 was $638,000. For the twelve-month period ended June 30, 2001,
the Company's provision was $7.9 million, which included $7.2 million in
charges with respect to two commercial business loans that were previously
reported in the second and third quarters. This compares to the $20,000 and
$706,000 for the respective prior three-month and twelve-month periods. For
the three-month period ended June 30, 2001, an additional provision of
$387,000 was made with respect to a commercial business loan placed on
non-accrual status during the quarter ended December 31, 2000. The additional
provision was deemed appropriate as a result of uncertainty in the Company's
ability to collect on certain remaining non-real estate collateral securing a
$6.7 million non-accrual loan which, as a result of charge-offs and payments
during the fiscal year, is now carried at $545,000. In addition, the
three-month period ended June 30, 2001 included other loan charges totaling
$150,000, of which $139,000 relates to one non-accrual commercial business
loan secured by, among other things, certain residential real estate.
Non-interest income for the three-month period ended June 30, 2001 was
$275,000 compared to $287,000 at June 30, 2000. For the twelve-month period
ended June 30, 2001 non-interest income was $1.8 million compared to $1.1
million for the similar prior year period. The increase in the fiscal year
ended June 30, 2001 was primarily a result of the Company's taking advantage
of market opportunities to realize gains upon the sale of loans available for
sale as well as increases in general service charges and fees.
Non-interest expense for the three-month and twelve-month periods ended
June 30, 2001 were $3.6 million and $13.9 million, respectively. This
compares to $3.3 million and $12.1 million, respectively, for the similar
prior year periods. Increases in the fiscal 2001 periods primarily were the
result of the costs associated with the full-year expenses of opening an
operations center, the expansion of the banking office network with two
additional offices (Rhawnhurst, Philadelphia County and North Wales,
Montgomery County) and increased professional fees. Additional costs were
incurred during the three-month period ended June 30, 2001 as a result of the
opening of our 12th banking office in Southampton, Bucks County.
Total assets amounted to $625.1 million at June 30, 2001, an increase of
$65.0 million, or 11.6%, from June 30, 2000. The increase in assets resulted
from net loans increasing $29.3 million, or 6.9%, and securities
available-for-sale increasing $59.8 million, or 84.7%. This increase was
partially a result of fixed-rate and adjustable-rate securities purchased
utilizing proceeds from a sale of an aggregate of $35.0 million of fixed-rate
loans during the year. Total liabilities amounted to $564.8 million at June
30, 2001, an increase of $65.3 million, or 13.1%, from June 30, 2000.
Deposits increased $44.2 million, or 9.8% to $497.0 million while borrowings
increased $22.4 million, or 59.6% to $59.9 million at June 30, 2001.
Stockholders' equity decreased $286,000 to $60.4 million at June 30, 2001
compared to $60.6 million at June 30, 2000. Changes in stockholders' equity
reflect the purchase of 184,000 additional shares of treasury stock as part of
the Company's Stock Buyback Program and appreciation of $2.2 million in
accumulated other comprehensive income (loss), primarily as a result of
declining interest rates relating to our security portfolio.
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The Company announced that its Board of Directors, on July 24, 2001,
declared a $.12 cash dividend per share on the common stock of the Company
payable on August 17, 2001 to stockholders of record at the close of business
on August 3, 2001. This is the tenth regular quarterly dividend paid to
stockholders since the Company's inception on December 23, 1998.
The Company also announced that its Board of Directors on July 24, 2001,
authorized the repurchase of up to 10% of the Company's remaining outstanding
stock over the next one-year period. This program is anticipated to continue
the success of the previous plan pursuant to which, during the fourth quarter,
the Company repurchased 44,000 shares of its common stock in the market at an
average price of $11.88. In the aggregate, the recently completed plan
resulted in the repurchase of a total of 206,500 shares at an average price of
$11.39.
Willow Grove Bancorp, Inc. is the holding company for Willow Grove Bank,
a federally chartered, FDIC-insured savings bank. The Bank was founded in
1909 and conducts its business from its headquarters in Maple Glen,
Pennsylvania. Its banking office network now has twelve offices located
throughout Montgomery, Bucks, and Philadelphia counties. Additional banking
offices are located in Willow Grove, Dresher, Huntingdon Valley, Hatboro,
Warminster (2), Roslyn, Philadelphia (2), North Wales, and Southampton.
This news release contains certain forward-looking statements.
Forward-looking statements can be identified by the fact that they do not
relate strictly to historical or current facts. They often include the words
"believe," "expect," "anticipate," "intend," "plan," "estimate" or words of
similar meaning, or future or conditional verbs such as "will," "would,"
"should," "could" or "may."
Forward-looking statements, by their nature, are subject to risks and
uncertainties. A number of factors - many of which are beyond the Company's
control - could cause actual conditions, events or results to differ
significantly from those described in the forward-looking statements. The
Company's reports filed from time-to-time with the Securities and Exchange
Commission, including the Company's Form 10-K for the year ended June 30,
2000, describe some of these factors, including general economic conditions,
changes in interest rates, deposit flows, the cost of funds, changes in credit
quality and interest rate risks associated with the Company's business and
operations. Other factors described in the Company's June 30, 2000 Form 10-K
include changes in competition, fiscal and monetary policies and legislation
and regulatory changes.
Forward-looking statements speak only as of the date they are made. The
Company does not undertake to update forward-looking statements to reflect
circumstances or events that occur after the date the forward-looking
statements are made or to reflect the occurrence of unanticipated events.
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WILLOW GROVE BANCORP, INC.
At June 30, 2001 At June 30, 2000
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Selected Financial (Dollars in thousands, except per share data)
Condition Data:
Total assets $625,148 $560,123
Cash and cash equivalents 22,209 14,681
Loans receivable, net 454,199 424,940
Loans available-for-sale 2,644 35,753
Securities available-
for-sale 130,358 70,577
Deposits 497,030 452,857
Stockholders' equity 60,357 60,643
Book value per diluted
common share 12.27 12.22
Three Months Fiscal
Ended Year Ended
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June 30, June 30, June 30, June 30,
2001 2000 2001 2000
-------------- ------------- -------------- ------------
(Dollars in thousands, (Dollars in thousands,
except per share data) except per share data)
Selected Operating
Statement Data:
Interest income $11,241 $10,602 $44,285 $38,893
Interest expense 6,089 5,416 24,216 19,369
Net interest income 5,152 5,186 20,069 19,524
Provision for loan losses 638 20 7,856 706
Total non-interest income 275 287 1,787 1,102
Total non-interest expense 3,572 3,286 13,875 12,076
Income tax (benefit) 404 916 (32) 3,001
Net income 813 1,251 157 4,843
Diluted earnings per share 0.16 0.25 0.03 0.97
Selected Other Data:
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Average yield interest- 7.51% 7.85% 7.64% 7.62%
earning assets (1)
Average cost interest- 4.86% 4.84% 5.05% 4.62%
bearing liabilities (1)
Average interest rate 2.65% 3.01% 2.59% 3.00%
spread (1)
Return on average 0.13% 0.89% 0.03% 0.93%
assets (1)
Return on average 1.32% 8.14% 0.25% 8.09%
equity (1)
Net interest margin (1) 3.44% 3.84% 3.46% 3.83%
Ratio of non-performing 0.81% 0.20% 0.81% 0.20%
asets to total assets
at period end
Ratio of non-performing 1.11% 0.15% 1.11% 0.15%
loans to total loans
Ratio of loan loss 0.94% 0.91% 0.94% 0.91%
reserves to total loans
at period end
Ratio of loan loss 84.77% 310.91% 84.77% 310.91%
reserves to non-
performing loans at
period end
Efficiency ratio 65.82% 60.04% 63.48% 58.55%
Full service banking 12 11 12 11
offices at period end
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(1) Annualized for the three months ended June 30, 2001 and 2000
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