Exhibit 99.1
CHARTER FINANCIAL REPORTS FY05 NET INCOME INCREASES 39%
-- EPS Climbs To $0.58 From $0.42 In Prior Year
-- Loan Balances Increase $40.7 Million To $356.8 Million
WEST POINT, Ga., Nov. 9 /PRNewswire-FirstCall/ -- Charter Financial Corporation
(Nasdaq: CHFN) today reported fiscal 2005 net income climbed approximately 39
percent to $11.4 million, or $0.58 per share, from $8.2 million, or $0.42 per
share, a year earlier. Net income for the quarter ended September 30, 2005, was
$2.8 million, or $0.14 per share, compared with $2.4 million, or $0.12 per
share, for the prior year period.
The increase in net income for the year was attributed to a $1.2 million
improvement in net interest income and a $4.5 million increase in noninterest
income. The increase in noninterest income resulted from an increased gain on
the sale of Freddie Mac stock and the improvement in net interest income was
from growth in the loan portfolio. These increases to net income were partially
offset by increases of $1.1 million in noninterest expense and $1.3 million in
tax expense.
Building Retail Bank Franchise
"We made significant progress in building our retail franchise and improving the
resulting earnings," said Robert L. Johnson, president and chief executive
officer. "We increased our net loans receivable by $40.7 million to $356.8
million, which contributed to the increase in net interest income of $1.2
million. Deposit fees also increased by seven percent to $2.7 million for the
year from $2.5 million for the prior year. This was consistent with the fourth
quarter, when deposit fees increased to $745,000 from $689,000 for the fourth
quarter last year. We have started construction on a replacement branch for our
downtown Opelika branch. The new branch will be more convenient and accessible
for our customers."
Capital Management
Johnson pointed out that Charter Financial continued to manage its capital by
investing in a second branch in LaGrange and consolidating its management and
support staff in one facility. The company also paid dividends that totaled
$3.20 per share during the year compared with $1.10 per share the prior year.
Charter Financial increased its regular quarterly cash dividend to $0.35 per
share in the third quarter from $0.25 per share. The company also paid a $2.00
special dividend during the year.
Managing Freddie Mac Common Stock
During the year, the company recognized $525,000 in income from covered calls on
Freddie Mac common stock compared with $149,000 in the prior year. Sales
resulting from exercises of covered calls generated gains of $6.1 million
compared with $2.1 million in fiscal 2004.
Charter Financial Corporation is a savings and loan holding company and the
parent company of CharterBank, a full-service community bank and a federal
savings institution. Charter Financial Corporation and its subsidiary,
CharterBank, are in a mutual holding company structure. CharterBank is
headquartered in West Point, Georgia, and operates nine full-service branches on
the I-85 corridor from LaGrange, Georgia to Auburn, Alabama. CharterBank's
deposits are insured by the Federal Deposit Insurance Corporation.
Forward-Looking Statements
This release may contain "forward-looking statements" that may be identified by
use of such words as "believe," "expect," "anticipate," "should," "planned,"
"estimated," and "potential." Examples of forward-looking statements include,
but are not limited to, estimates with respect to our financial condition and
results of operation and business that are subject to various factors that could
cause actual results to differ materially from these estimates. These factors
include but are not limited to general and local economic conditions; changes in
interest rates, deposit flows, demand for mortgages and other loans, real estate
values, and competition; changes in accounting principles, policies, or
guidelines; changes in legislation or regulation; and other economic,
competitive, governmental, regulatory, and technological factors affecting our
operations, pricing, products, and services. Any or all forward-looking
statements in this release and in any other public statements we make may turn
out to be wrong. They can be affected by inaccurate assumptions we might make or
known or unknown risks and uncertainties. Consequently, no forward-looking
statements can be guaranteed. The Company disclaims any obligation to
subsequently revise or update 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.
Selected Financial Data (in thousands except share data):
September 30, September 30, June 30,
2005 2004 2005
------------- ------------- -------------
Unaudited
Total Assets $ 1,050,570 $ 1,068,201 $ 1,081,518
Loans Receivable, Net 356,808 316,151 338,201
Mortgage Securities Available
for Sale 358,461 378,357 379,886
Freddie Mac Common Stock 254,776 300,430 295,981
Other Investment Securities 17,712 22,157 9,951
Retail Deposits 250,391 245,463 237,799
Core Deposits 131,361 129,349 126,647
Total Deposits 320,129 279,575 291,773
Deferred Income Taxes 92,143 111,603 109,641
Borrowings 382,336 392,789 395,817
Realized Stockholders' Equity* 93,825 92,141 91,530
Accumulated Other
Comprehensive Income** 149,405 180,359 177,238
Total Equity 243,230 272,500 268,768
Book Value per Share $ 12.31 $ 13.80 $ 13.60
Tangible Book Value per Share 12.02 13.49 13.31
Minority Shares Outstanding 3,904,492 3,893,642 3,900,442
Total Shares Outstanding
- at Quarter End 19,762,416 19,751,566 19,758,366
Weighted Average Total Shares
Outstanding - Basic 19,523,748 19,437,613 19,521,693
Weighted Average Total Shares
Outstanding - Fully Diluted 19,569,097 19,478,037 19,570,164
* Includes Total Stockholders Equity less Accumulated Other Comprehensive
Income.
** Includes unrealized gains and losses on Freddie Mac common stock and
other investment securities adjusted for income taxes at a tax rate of
38.6%
Selected Operating Data (in thousands except share data):
Three months ended
Year Ended ------------------------------------
September 30, September 30,
----------------------- ----------------------- June 30,
2005 2004 2005 2004 2005
---------- ---------- ---------- ---------- ----------
Unaudited
Total Interest
Income $ 44,689 $ 38,813 $ 11,530 $ 10,239 $ 11,422
Total Interest
Expense 21,782 17,068 5,831 4,549 5,610
Net Interest
Income 22,907 21,745 5,699 5,690 5,812
Provision for
Loan Losses 75 30 75 - -
Net Interest
Income after
Provision for
Loan Losses 22,832 21,715 5,624 5,690 5,812
Noninterest
Income 10,966 6,508 2,871 1,987 3,108
Noninterest
Expense 18,269 17,156 4,603 4,361 4,535
Income before
Income Taxes 15,529 11,067 3,892 3,316 4,385
Income Tax Expense
(Benefit) 4,116 2,850 1,075 892 1,176
Net Income $ 11,413 $ 8,217 $ 2,817 $ 2,424 $ 3,209
Earnings per
Share $ 0.58 $ 0.42 $ 0.14 $ 0.12 $ 0.16
Earnings per Share
- Fully Diluted 0.58 0.42 0.14 0.12 0.16
Cash Dividends
per Share*** 3.20 1.10 0.35 0.25 0.35
Net Charge-offs
(Recoveries) 537 187 269 15 28
Deposit Fees 2,726 2,549 745 689 679
Gain on Sale of
Loans 884 1,152 254 255 196
Gain on Sale of
Freddie Mac
Common Stock 6,085 2,113 1,603 988 1,906
Gain (Loss) on
Covered Calls
Related to
Freddie Mac
Common Stock 525 149 76 11 141
*** First Charter, MHC has waived its portion of these dividends, resulting
in payment only to the minority stockholders.
Three months ended
Year Ended --------------------------------------
September 30, September 30,
------------------------ ------------------------ June 30,
Performance Ratios: 2005 2004 2005 2004 2005
- ------------------------- ---------- ---------- ---------- ---------- ----------
Unaudited
Return on Equity 4.23% 3.23% 4.28% 3.59% 4.89%
Return on Assets 1.06 0.79 1.06 0.90 1.19
Net Interest Margin 2.18 2.14 2.21 2.17 2.22
Loan Loss Reserve as a
% of Total Loans 1.69 2.05 1.69 2.05 1.84
Loan Loss Reserve as a %
of Nonperforming Assets 118.56 104.83 118.56 104.83 104.50
Nonperforming Assets as a
% of Total Loans and
REO 1.42 1.95 1.42 1.95 1.75
Net Chargeoffs
(Recoveries) as a % of
Average Loans 0.16 0.06 0.08 0.01 0.01
Nonperforming Assets to
Total Assets 0.49 0.59 0.49 0.59 0.56
Bank Core Capital Ratio 9.86 9.46 9.86 9.46 9.86
Dividend Payout Ratio 98.56 46.02 43.70 36.03 38.36
Effective Tax Rate
Expense (Benefit) 26.51 25.75 27.61 26.91 26.81
SOURCE Charter Financial Corporation
-0- 11/09/2005
/CONTACT: Robert L. Johnson, President & CEO, of Charter Financial
Corporation, +1-706-645-1391, bjohnson@charterbank.net ; or Mike Arneth,
marneth@tirc.com , or Woody Wallace, wwallace@tirc.com , both of The Investor
Relations Company, +1-847-296-4200/