EXHIBIT 99.1
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Contact: Clement B. Knapp, Jr. FOR IMMEDIATE RELEASE
President
(219) 836-5870 April 27, 2005
AMB FINANCIAL ANNOUNCES AN INCREASE IN THE QUARTERLY
DIVIDEND AND FIRST QUARTER RESULTS
Munster, Indiana - AMB Financial Corp. (OTCBB: AMFC) (the "Company") the parent
holding company for American Savings, FSB (the "Bank") announced today that
earnings per share for the first quarter ended March 31, 2005 totaled $.14 per
diluted share, compared to $.26 per diluted share reported for the quarter ended
March 31, 2004. The decreased earnings per share compared to last year resulted
primarily from a higher loan loss provision as well as the reporting of an
unrealized loss from the Company's trading portfolio compared to an unrealized
gain reported in the prior year period. Net income for the current quarter
totaled $144,000 compared to $265,000 reported in the year earlier period.
Return on average equity and return on average assets were 4.24% and .37%,
respectively, in the current quarter compared to 8.29% and .72% in last year's
comparable period.
AMB Financial Corp. also announced an increase in its quarterly cash dividend to
$.07 per share for the quarter ending March 31, 2005, an increase of 16.67% from
the $.06 per share paid for the prior quarter. The dividend will be payable on
May 25, 2005 to the shareholders of record on May 11, 2005.
RESULTS FOR THE QUARTER ENDED MARCH 31, 2005
Net interest income for the current quarter totaled $1.13 million, up slightly
from the $1.12 million for last year's first quarter. The Bank's net interest
margin was 3.23% in the current quarter, compared to 3.39% in the March 31, 2004
quarter. The decline in the net interest margin was primarily due to a decline
in the yield on interest-earning assets to 5.73% in the current quarter compared
to 5.93% in last year's first quarter. This decrease resulted primarily from the
impact of loan prepayments, with new loans originating at lower rates as well as
the acceleration of amortization of premium write-off on purchased loans. The
lower asset yields were partially offset by a decline in funding costs as the
average cost of interest-bearing liabilities decreased to 2.53% in the current
quarter from 2.56% in last year's comparable quarter.
Non-interest income decreased to $271,000 in the current quarter, compared to
$352,000 reported in last year's first quarter. The decline in non-interest
income was primarily attributable to a $68,000 decrease in income from trading
account securities as the market price of the Company's portfolio of small
thrift and community bank stocks declined primarily due to a general decline in
financial institution stock prices during the quarter. In addition, the prior
year period includes a $27,000 gain from the excess proceeds on a life insurance
policy due to the death of one of the Company's directors. Offsetting these
decreases in non-interest income was a $12,000 increase in deposit related fees,
primarily due to a new fee structure on NOW account overdrafts and higher ATM
surcharge fees as well as an increase of $17,000 in service fee income related
to the Company's accounts receivable, serviced by others, which experienced an
increase in activity between the periods. The Company also incurred a loss of
$22,500 in the current quarter compared to a loss of $21,500 in prior year's
quarter, related to an investment in a low-income housing joint venture. As a
result of this investment, the Company recorded an offsetting $35,000 in federal
income tax credits during both periods, which resulted in the reduction of the
Company's effective income tax rate.
In March 2005, the shareholders of Intrieve, Incorporated, the Bank's data
processing provider, approved the sale and merger of Intrieve into Harland
Financial Solutions, Inc., a wholly owned subsidiary of John H. Harland Company.
This transaction closed in April 2005. As a shareholder of Intrieve, the Bank
received $344,000 in cash on its $15,000 investment, resulting in a gain of
$329,000, which will be recorded in the second quarter of 2005.
Non-interest expense totaled $1.06 million in the current quarter; a decline of
$9,000 from the $1.07 million reported for the quarter ended March 31, 2004. The
decrease resulted from a reduction in
advertising costs of $25,000 as well as a decline in real estate tax and
depreciation expense of $15,000. These decreases were offset by increases in
staffing costs of $5,000, primarily increased benefit costs, increased data
processing costs of $9,000 and increased professional fees of $14,000 due to
ongoing regulatory compliance efforts and increased examination fees.
The Company recorded a provision for loan losses of $154,000 during the
three-month period ended March 31, 2005 as compared to a $26,000 provision in
the prior year period. There were no changes in estimation method or assumptions
that impacted the provision for loan losses during the quarter. During the
current quarter, the Company's management, based upon updated information,
authorized the establishment of $105,000 of additional reserves against three
non-accrual loans including two related purchased commercial business loans
secured by medical equipment having a net book value at December 31, 2004 of
$72,000 and one unsecured loan to an unrelated borrower having a net book value
at December 31, 2004 of $33,000. At March 31, 2005, as a result of these
reserves, the subject loans had no remaining net book value. These loans were
charged off in April 2005. The Bank's general allowance for loan losses was
$658,000 at March 31, 2005, which is equal to 37.8% of non-performing loans and
..50% of net loans receivable.
Income tax expense totaled $40,000 in the current quarter, an effective tax rate
of 21.9%, compared to $103,000 or an effective tax rate of 28.0% for the quarter
ended March 31, 2004. Both periods were positively impacted by the recognition
of approximately $35,000 in low-income housing tax credits, which have a greater
impact on the effective rate in a lower earnings period compared to a higher
earnings period.
BALANCE SHEET AND CAPITAL
Total assets of the Company increased by $3.2 million to $160.3 million at March
31, 2005 from $157.1 million reported at December 31, 2004. The increase in
assets during the three-month period resulted primarily from growth in loan
balances, which totaled $132.3 million at March 31, 2005 compared to $129.3
million at December 31, 2004, an increase of $3.0 million. In addition, the
Company increased its cash position by $400,000 at March 31, 2005. The growth in
assets during the three-month period was funded primarily from an increase in
borrowed money, which increased by $2.0 million to $21.0 million at March 31,
2005. Deposit balances also increased slightly to $116.0 million at March 31,
2005 from $115.7 million at December 31, 2004.
As of March 31, 2005, stockholders' equity in AMB Financial Corp. totaled $13.3
million. The number of common shares outstanding at March 31, 2005 was 974,143
and the book value per common share outstanding was $13.69. The Bank's tangible,
core and risk-based capital percentages of 9.02%, 9.02% and 15.33%,
respectively, at March 31, 2005 exceeded all regulatory requirements by a
significant margin.
Non-performing assets increased during the past three months totaling $1.95
million or 1.22% of total assets at March 31, 2005 compared to $1.61 million or
1.02% of total assets at December 31, 2004. The increase in the most recent
three-month period relates to several delinquent single-family residential
loans. One of these loans, amounting to $106,000 at March 31, 2005, has since
been brought current.
This news release contains various forward-looking statements consisting of
estimates with respect to the financial condition, results of operations and
business of the Company and the Bank. These estimates are subject to various
factors that could cause actual results to differ materially from those
estimates. These factors include, but are not limited to, (i) the effect that
movements in interest rates could have on net interest income and loan
repayments, (ii) changes in customer preference for our products and services,
(iii) changes in national and local economic and market conditions, including
prevailing real estate values, (iv) higher than anticipated operating expenses,
(v) a lower level of or higher cost for deposits or a higher cost for borrowings
than anticipated, (vi) changes in accounting principles, policies or guidelines,
(vii) legislation or regulations adversely affecting the Bank or Company, and
(viii) the success of the Company's workout programs for troubled assets.
2
American Savings, FSB is a federally chartered stock savings bank. The Bank is a
community oriented institution offering a variety of traditional deposit and
loan products. It operates three full service offices located in Dyer, Hammond
and Munster, Indiana.
(Two pages of selected financial information are included with this release.)
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AMB Financial Corp.
Selected Financial Condition Data
(In Thousands)
Mar. 31 Dec. 31
2005 2004
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(Unaudited)
Total assets 160,263 157,094
Loans receivable, net 132,309 129,342
Mortgage-backed securities 2,152 2,286
Investment securities and interest bearing deposits 9,623 9,305
Deposits 116,041 115,659
Borrowed money 20,954 18,954
Guaranteed preferred beneficial interest
in the Company's subordinated debentures 5,000 5,000
Stockholders' equity 13,339 13,409
Selected Operations Data
(In Thousands)
(Unaudited)
Three Months Ended
March 31
2005 2004
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Total interest income $ 2,006 1,955
Total interest expense 874 839
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Net interest income 1,132 1,116
Provision for loan losses 154 26
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Net interest income after provision for
loan losses 978 1,090
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Non-interest income:
Fees and service charges 250 226
Rental Income 35 34
Gain (loss) on trading securities (26) 42
Loss from investment in joint venture (23) (22)
Increase in cash surrrender value of life insurance 30 39
Gain from life insurance proceeds -- 27
Other operating income 5 6
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Total non-interest income: 271 352
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Non-interest expense:
Staffing cost 556 551
Advertising 25 50
Occupancy and equipment costs 106 121
Data processing 147 136
Professional fees 61 47
Other 170 169
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Total non-interest expense 1,065 1,074
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Net income before income taxes 184 368
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Provision for federal & state income taxes 40 103
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Net income $ 144 265
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Earnings per share
Basic $0.15 $0.28
Diluted $0.14 $0.26
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AMB Financial Corp.
Selected Financial Ratios and Other Data
(Unaudited)
Three Months Ended
March 31
2005 2004
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Performance Ratios:
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Return on average assets 0.37% 0.72%
Return on average equity 4.24 8.29
Interest rate spread information:
Average during period 3.20 3.37
End of period 3.06 3.27
Net interest margin 3.23 3.39
Efficiency ratio 75.90 74.47
Ratio of operating expense to average total assets 2.72 2.90
Ratio of average interest earning assets to average
interest-bearing liabilities: 1.01x 1.00x
Weighted average common shares outstanding:
Basic 964,743 931,030
Diluted 1,024,271 1,012,977
At At
Mar.31 Dec.31
2005 2004
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Quality Ratios: (Unaudited) (Unaudited)
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Non-performing assets to total assets at end of
period 1.22% 1.02%
Allowance for loan losses to non-performing
loans 44.60 44.50
Allowance for loan losses to loans receivable, net 0.65 0.55
Capital Ratios:
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Equity to total assets at end of period 8.32 8.54
Average equity to average assets 8.66 8.56
Other Data:
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Number of full service offices 3 3
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CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the quarterly report of AMB Financial Corporation (the
"Company") on Form 8-K for the period ending March 31, 2005 as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I Clement
B. Knapp, President and Chief Executive Officer of the Company, certify,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:
(1) The report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations
of the Company.
Date: April 27, 2005 /s/ Clement B. Knapp
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Clement B. Knapp
President and Chief Executive Officer
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the quarterly report of AMB Financial Corporation (the
"Company") on Form 8-K for the period ending March 31, 2005 as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I Daniel
T. Poludniak, Vice President, Treasurer and Chief Financial Officer of the
Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations
of the Company.
Date: April 27, 2005 /s/ Daniel T. Poludniak
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Daniel T. Poludniak, Vice President,
Treasurer and Chief Financial Officer
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