Exhibit 99.1
CHARTER FINANCIAL REPORTS SECOND QUARTER EARNINGS
- -- Core Deposit Balances Grow $14.5 million to $143.4 million
- -- Loan Balances Increase by $6.8 Million to $383.5 Million
WEST POINT, Ga., April 26 /PRNewswire-FirstCall/ -- Charter Financial
Corporation (Nasdaq: CHFN) today reported second quarter fiscal 2006 net
income of $2.6 million, or $0.13 per share, compared with $2.5 million,
or $0.13 per share, for same quarter of the prior year. Net income for
the six months ending March 31, 2006 was $7.9 million or $0.40 per share
compared with $5.4 million or $0.28 per share for the comparable period
in the prior year.
The increase in net income for the quarter was attributed to a $910,000
improvement in net interest income, which was partially offset by
increases in noninterest expense and tax expense. The improvement in net
interest income was from growth in the loan portfolio and increases in
dividends received from Freddie Mac. Our net interest income increased
as we increased balances in the higher margin loans and decreased
balances in the lower margin securities and borrowings.
"We continue to 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 to $383.5
million, which is up $6.8 million from the balance at December 31, 2005
and up $56.3 million from March 31, 2005. We attribute our loan growth
to having strengthened our commercial real estate loan staff. We grew
core deposits $14.5 million for the quarter to $143.4 million. Deposit
fees also increased by approximately six percent to $883,000 for the
quarter from $833,000 for the prior quarter indicating continued
marketing success of our suite of checking products."
During the six months ended March 31, 2006, the company recognized $4.8
million in income from sales of Freddie Mac common stock compared with
$2.6 million in the prior year period. The sales resulted from exercises
of covered calls written by the Company. These sales are a positive
development because they allow the company to realize the value of the
asset at a measured pace.
"We anticipate a significant boost to the economy in our market area
over the next several years from a new manufacturing facility," Johnson
states. "Kia Motors Corporation announced that it will build a $1.2
billion automotive assembly and manufacturing plant in West Point. It is
anticipated that this facility will directly provide more than 2,000
jobs. The plant is scheduled to begin construction later this year and
is tentatively scheduled to begin operations in 2008. Charter Financial
is well-positioned to provide the entire spectrum of banking services
required, from checking accounts and mortgages for workers, to cash
management and commercial loans for the variety of supporting business
enterprises.
"As a leading community bank in the area, we should see accelerated
growth in both our retail banking and commercial businesses. It is,
however, too early to project the extent of that growth," Johnson
concluded.
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.
Charter Financial owns 4.4 million shares of Freddie Mac common stock
with a market value of $270.7 million. 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 and per share data):
March 31, December 31, September 30, March 31,
2006 2005 2005 2005
------------- ------------- ------------- -------------
Unaudited
Total Assets $ 1,100,952 $ 1,094,812 $ 1,050,570 $ 1,070,653
Loans Receivable, Net 383,480 376,647 356,808 327,184
Mortgage Securities
Available for Sale 331,094 348,000 358,461 385,406
Freddie Mac Common Stock 270,688 289,991 254,776 288,666
Other Investment
Securities 37,589 17,227 17,712 13,823
Retail Deposits 272,935 254,239 250,391 238,259
Core Deposits 143,386 128,859 131,361 126,566
Total Deposits 365,501 354,977 320,129 287,232
Deferred Income Taxes 98,553 106,360 93,271 104,458
Borrowings 366,935 351,036 382,336 407,714
Realized Stockholders' Equity* 97,781 96,735 93,825 89,552
Accumulated Other
Comprehensive Income** 157,807 170,225 149,405 168,994
Total Equity 255,588 266,960 243,230 258,545
Book Value per Share $ 13.02 $ 13.51 $ 12.31 $ 13.09
Tangible Book Value
per Share 12.73 13.22 12.02 12.79
Minority Shares
Outstanding 3,559,854 3,542,754 3,542,754 3,517,056
Total Shares Outstanding
- at Quarter End 19,630,772 19,629,372 19,629,372 19,603,674
Weighted Average Total
Shares Outstanding
- Basic 19,401,055 19,533,722 19,523,748 19,517,703
Weighted Average Total
Shares Outstanding
- Fully Diluted 19,584,927 19,575,347 19,569,097 19,581,137
* 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 and per share data):
Three months ended Six months ended
-------------------------------------- -----------------------
March 31, December 31, March 31,
------------------------ ------------ -----------------------
2006 2005 2005 2006 2005
---------- ---------- ------------ ---------- ----------
Unaudited
Total Interest Income $ 13,273 $ 11,059 $ 12,787 $ 26,060 $ 21,738
Total Interest Expense 6,606 5,302 6,307 12,913 10,341
Net Interest Income 6,667 5,757 6,480 13,147 11,397
Provision for Loan Losses - - - - -
Net Interest Income
after Provision for
Loan Losses 6,667 5,757 6,480 13,147 11,397
Noninterest Income 1,694 1,695 5,961 7,655 4,987
Noninterest Expense 4,873 4,530 5,040 9,913 9,131
Income before
Income Taxes 3,488 2,922 7,401 10,889 7,253
Income Tax Expense 936 459 2,067 3,003 1,866
Net Income $ 2,552 $ 2,463 $ 5,334 $ 7,886 $ 5,387
Earnings per Share $ 0.13 $ 0.13 $ 0.27 $ 0.40 $ 0.28
Earnings per Share
- Fully Diluted 0.13 0.13 0.27 0.40 0.28
Cash Dividends
per Share*** 0.45 0.25 0.70 1.15 2.50
Net (Recoveries)
Charge-offs (2) 27 19 17 240
Deposit Fees 883 632 833 1,716 1,302
Gain on Sale of Loans 153 201 163 316 434
Gain on Sale of Freddie Mac
Common Stock - - 4,769 4,769 2,577
Gain on Covered Calls
Related to Freddie Mac
Common Stock 310 674 13 323 308
*** First Charter, MHC has waived its portion of these dividends,
resulting in payment only to the minority stockholders.
Three months ended Six months ended
------------------------------------ --------------------
March 31, December 31, March 31,
-------------------- ------------ --------------------
2006 2005 2005 2006 2005
-------- -------- ------------ -------- --------
Unaudited
Return on Equity 3.74% 3.60% 8.43% 6.00% 3.90%
Return on Assets 0.92 0.90 2.00 1.45 0.99
Net Interest Margin 2.49 2.16 2.50 2.49 2.14
Loan Loss Reserve as
a % of Total Loans 1.57 1.91 1.60 1.57 1.91
Loan Loss Reserve as
a % of Nonperforming
Assets 139.27 101.37 128.27 139.27 101.37
Nonperforming Assets
as a % of Total Loans
and REO 1.13 1.88 1.24 1.13 1.88
Net Chargeoffs as a % of
Average Loans - 0.01 0.01 - 0.08
Nonperforming Assets
to Total Assets 0.40 0.59 0.44 0.40 0.59
Bank Core Capital Ratio 8.79 9.64 8.84 8.79 9.64
Dividend Payout Ratio 62.77 35.70 46.49 51.76 163.11
Effective Tax Rate Expense 26.84 15.72 27.93 27.58 25.73
SOURCE Charter Financial Corporation
-0- 04/26/2006
/CONTACT: Robert L. Johnson, President & CEO of Charter Financial,
+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,
+1-312-245-2700/