Exhibit 99
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P R E S S R E L E A S E
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RELEASE DATE: CONTACT:
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January 25, 2006 CHARLES P. EVANOSKI
GROUP SENIOR VICE PRESIDENT
CHIEF FINANCIAL OFFICER
(724) 758-5584
FOR IMMEDIATE RELEASE
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ESB FINANCIAL CORPORATION ANNOUNCES
EARNINGS FOR FOURTH QUARTER AND 2005 YEAR END
Ellwood City, Pennsylvania, January 25, 2006 - ESB Financial
Corporation (NASDAQ: ESBF), the parent company of ESB Bank, today
announced earnings of $0.71 per diluted share on net income of
$9.18 million for the year ended December 31, 2005, compared to
earnings of $0.94 per diluted share on net income of $9.99 million
for the year ended December 31, 2004. The Company's return on
average assets and average equity were 0.52% and 7.16%,
respectively, for the year ended December 31, 2005.
For the three months ended December 31, 2005, the Company
announced earnings of $0.02 per diluted share on net income of
$209,000, compared to earnings of $0.25 per diluted share on net
income of $2.59 million for the quarter ended December 31, 2004.
During the quarter ended December 31, 2005, the Company
restructured a portion of its securities portfolios to reduce the
prepayment risk associated with these securities. In connection
with the restructuring, the Company incurred a pre-tax loss of
approximately $2.99 million, or an after tax loss of approximately
$1.98 million or $0.15 per diluted share. The Company's annualized
return on average assets and average equity were 0.05% and 0.66%,
respectively, for the quarter ended December 31, 2005.
Commenting on the quarter and year end results, Charlotte A.
Zuschlag, President and Chief Executive Officer of the Company and
the Bank, stated, "The interest rate environment and the continued
flattening of the yield curve made 2005 a very challenging year.
The Company remains focused on improving net interest and
noninterest income, while pursuing strategies to grow and provide
a sound investment return to our shareholders. One such strategy
to improve the long-term profitability of the Company and maximize
long-term value for our stockholders was management's ability to
capitalize on the current interest rate environment and positively
restructure its securities portfolio. While the current quarter
and year to date earnings were adversely impacted, the sale of
these lower coupon securities should improve our interest rate
margin and earnings going forward. Additionally, the Company's
focus is exemplified this year with the efforts of the Company's
management and employees to coordinate and complete the successful
integration of PHSB Financial Corporation (PHSB), which was
acquired on February 11, 2005, into the operations of ESB
Financial Corporation."
Consolidated net income for the year ended December 31, 2005
decreased $811,000 or 8.1% to $9.18 million from $9.99 million, as
compared to the year ended December 31, 2004. This net decrease
was a result of a decrease in non-interest income of $3.82 million
and increases in non-interest expense of $2.96 million, partially
offset by an increase in net interest income of $4.94 million
after the increase to provision for loan losses of $362,000 and a
decrease in the provision for income taxes of $1.02 million. The
$3.82
Press Release
Page 2 of 3
January 25, 2006
million decrease to noninterest income was primarily due to
a decrease to the gain on the sale of securities available for
sale of approximately $3.86 million, primarily as a result of the
securities restructuring, as well as a decline in the income
generated by the Company's real estate joint ventures of
approximately $1.22 million. Declines in these areas were
partially offset by an increase in fees and service charges of
approximately $1.1 million. The $2.96 million increase in
noninterest expense was primarily related to increases to
compensation and employee benefits, premises and equipment,
amortization of intangible assets, data processing and other
expenses of approximately $1.17 million, $737,000, $690,000,
$361,000 and $1.29 million, respectively. Other noninterest
expense was affected by an increase in the amortization of the
core deposit intangible recorded in connection with the
acquisition of PHSB of $719,000. Partially offsetting these
increases were decreases to the loss on early extinguishment of
debt and minority interest of approximately $844,000 and $605,000,
respectively. Noninterest income and noninterest expense were
affected by increases due primarily to the acquisition of PHSB's
operations.
Consolidated net income for the quarter ended December 31, 2005
decreased $2.38 million or 91.9% to $209,000 from $2.59 million,
as compared to the quarter ended December 31, 2004. This net
decrease was a result of a decrease in non-interest income of
$3.37 million and an increase in non-interest expense of $869,000,
partially offset by an increase in net interest income of $276,000
after the increase to provision for loan losses of $590,000. The
$3.37 million decrease to noninterest income was primarily due to
a decrease in the gain on the sale of securities available for
sale of approximately $3.04 million, primarily as a result of the
securities restructuring, as well as a decline in the income
generated by the Company's real estate joint ventures of
approximately $786,000. The declines in these areas were partially
offset by an increase in fees and service charges of approximately
$409,000. The $869,000 increase in noninterest expense was
primarily related to increases associated with the compensation
and employee benefits, premises and equipment, data processing and
other expenses of $146,000, $249,000, $116,000 and $544,000,
respectively. Other noninterest expense was affected by an
increase in the amortization of the core deposit intangible
recorded in connection with the acquisition of PHSB of $203,000.
Partially offsetting these increases was a decrease to minority
interest of approximately $400,000. Noninterest income and
noninterest expense were affected by increases due primarily to
the acquisition of PHSB's operations.
The Company's consolidated total assets increased $458.3 million
or 32.9% to $1.85 billion at December 31, 2005, from $1.39 billion
at December 31, 2004. Securities increased $187.3 million or
20.1% to $1.12 billion and net loans receivable increased $196.8
million or 57.3% to $540.3 million. Total deposits increased
$254.2 million or 43.8% to $834.5 million and borrowed funds
increased $166.5 million or 23.69% to $869.2 million, as compared
to December 31, 2004.
Total stockholders' equity was $126.9 million or 6.85% of total
assets, and book value per share was $9.58 at December 31, 2005
compared to $97.8 million or 7.01% of total assets, and book value
per share of $9.16 at December 31, 2004.
The Company also announced that its annual meeting of stockholders
will be held on Wednesday, April 19, 2006 at 4:00 p.m. at the
Connoquenessing Country Club in Ellwood City, Pennsylvania.
ESB Financial Corporation is the parent holding company of ESB
Bank, and offers a wide variety of financial products and services
through 23 offices in the contiguous counties of Allegheny,
Lawrence, Beaver and Butler in Pennsylvania. The common stock of
the Company is traded on The NASDAQ Stock Market under the symbol
"ESBF". We make available on our web site, which is located at
http://www.esbbank.com, our annual report on Form 10-K, quarterly
reports on Form 10-Q and current reports on Form 8-K, on the date
which we electronically file these reports with the Securities and
Exchange Commission. Investors are encouraged to access these
reports and the other information about our business and
operations on our web site.
Press Release
Page 3 of 3
January 25, 2006
ESB FINANCIAL CORPORATION AND SUBSIDIARIES
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Financial Highlights
(Dollars in Thousands - Except Per Share Amounts)
OPERATIONS DATA:
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Year Ended Three Months
December 31, Ended December 31,
2005 2004 2005 2004
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<s> <c> <c> <c> <c>
Interest income $80,353 $ 60,798 $ 21,515 $ 15,637
Interest expense 49,823 35,569 14,210 9,198
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Net interest income 30,530 25,229 7,305 6,439
Provision for (recovery of) loan losses 568 206 499 (91)
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Net interest income after provision for
(recovery of) loan losses 29,962 25,023 6,806 6,530
Noninterest income 3,142 6,960 (1,671) 1,700
Noninterest expense 23,115 20,157 5,859 4,990
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Income before provision for income taxes 9,989 11,826 (724) 3,240
Provision for (recovery of) income taxes 810 1,836 (933) 649
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Net income $ 9,179 $ 9,990 $ 209 $ 2,591
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Earnings per share:
Basic $0.73 $0.98 $0.02 $0.25
Diluted $0.71 $0.94 $0.02 $0.25
Annualized return on average assets 0.52% 0.73% 0.05% 0.75%
Annualized return on average equity 7.16% 10.38% 0.66% 10.57%
FINANCIAL CONDITION DATA:
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12/31/05 12/31/04
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Total assets $1,852,779 $1,394,515
Cash and cash equivalents 28,215 17,703
Total investment securities 1,117,063 929,794
Loans receivable, net 540,277 343,524
Customer deposits 834,530 580,346
Borrowed funds (includes subordinated debt) 869,242 702,773
Stockholders' equity 126,877 97,801
Book value per share $9.58 $9.16
Average equity to average assets 7.28% 6.99%
Allowance for loan losses to loans receivable 0.86% 1.06%
Non-performing assets to total assets 0.27% 0.26%