United Community Financial Corp. (Company) (Nasdaq: UCFC), holding company of The Home Savings and Loan Company of Youngstown, Ohio (Home Savings), today reported consolidated net income of $3.0 million, or $0.10 per diluted share, for the three months ended March 31, 2011. This compares to a net loss of $5.1 million, or $(0.17) per diluted share, for the three months ended March 31, 2010.
Selected first quarter results:
- Delinquent loans declined $7.3 million to $158.3 million from the prior quarter
- Net interest margin increased 32 basis points to 3.49% from the prior quarter
- Home Savings’ Tier 1 leverage ratio increased 60 basis points from the prior quarter to 8.44%
- Home Savings’ Total Risk Based Capital increased 48 basis points from the prior quarter to 13.02%
- Book value per share and tangible book value per share increased $0.04 and $0.05, respectively, from the prior quarter to $5.73 and $5.72, respectively
Net Interest Income and Margin
Net interest income for the three months ended March 31, 2011, was $17.7 million, which was unchanged from a year earlier. Total interest income decreased $3.1 million in the first quarter of 2011 compared to the first quarter of 2010, primarily as a result of a decrease of $215.3 million in the average balance of outstanding loans. Total interest expense, however, also decreased by a comparable amount of $3.0 million for the first quarter of 2011, as compared to the same quarter last year. The decline was due to a reduction in interest paid on deposits due to changes in the deposit portfolio composition and lower rates paid on certificates of deposit.Net interest margin was 3.49% for the first quarter of 2011 compared with 3.28% for the first quarter of 2010 and 3.17% from December 31, 2010.