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Hingham Institution For Savings Reports 13% Increase In Quarterly Earnings

The Bank’s shares of common stock are listed and traded on The NASDAQ Stock Market under the symbol HIFS.

 
 
HINGHAM INSTITUTION FOR SAVINGS
Consolidated Balance Sheets
               

March 31,2012

December 31,2011

March 31,2011
(Dollars in thousands except per share data)
(Unaudited)
ASSETS
 
Cash and due from banks $ 8,146 $ 8,918 $ 7,037
Short-term investments   108,345   107,422     65,420
Cash and cash equivalents 116,491 116,340 72,457
 
Certificates of deposit 13,754 13,405 13,980
Securities available for sale, at fair value 99,772 96,689 94,053
Federal Home Loan Bank stock, at cost 13,159 13,373 13,373

Loans, net of allowance for loan losses of $7,639 at March 31, 2012, $7,516 at December 31, 2011 and $7,205 at March 31, 2011
869,051 849,776 803,653
Foreclosed assets 3,884 3,629 3,044
Bank-owned life insurance 14,621 14,524 14,190
Premises and equipment, net 10,509 10,597 9,106
Accrued interest receivable 2,973 2,858 3,208
Prepaid FDIC assessment 1,755 1,871 2,173
Deferred income tax asset, net 3,462 3,425 2,852
Other assets   1,049   789     923
Total assets $ 1,150,480 $ 1,127,276   $ 1,033,012
 

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
Deposits $ 807,730 $ 787,573 $ 738,204
Federal Home Loan Bank advances 246,442 247,471 211,553
Mortgage payable 1,097 1,107 1,137
Mortgagors’ escrow accounts 2,709 2,517 2,443
Accrued interest payable 472 475 571
Other liabilities   7,121   5,868   4,093
Total liabilities   1,065,571   1,045,011   958,001
 
Stockholders’ equity:

Preferred stock, $1.00 par value, 2,500,000 shares authorized, none issued

Common stock, $1.00 par value, 5,000,000 shares authorized; 2,125,750 shares issued and outstanding as of March 31, 2012 and December 31, 2011 and 2,124,250 shares issued and outstanding as of March 31, 2011
2,126 2,126 2,124
Additional paid-in capital 10,500 10,500 10,417
Undivided profits 72,114 69,404 62,369
Accumulated other comprehensive income   169   235   101
Total stockholders’ equity   84,909   82,265   75,011
Total liabilities and stockholders’ equity $ 1,150,480 $ 1,127,276 $   1,033,012
       
 

HINGHAM INSTITUTION FOR SAVINGS

Consolidated Statements of Income
 
Three Months Ended

March 31,
(Dollars in thousands, except per share amounts) 2012         2011
(Unaudited)
 
Interest and dividend income:
Loans $ 11,843 $ 11,568
Debt securities 149 239
Equity securities 42 34
Short-term investments and certificates of deposit   89   82
Total interest and dividend income   12,123   11,923
 
Interest expense:
Deposits 1,506 1,758
Federal Home Loan Bank advances 1,240 1,492
Mortgage payable   16   17
Total interest expense   2,762   3,267
Net interest income 9,361 8,656
Provision for loan losses   225   300
Net interest income, after provision for loan losses   9,136   8,356
Other income:
Customer service fees on deposits 253 235
Increase in Bank-owned life insurance 97 116
Miscellaneous   57   60
Total other income   407   411
Operating expenses:
Salaries and employee benefits 2,335 2,150
Data processing 231 221
Occupancy and equipment 419 355
Deposit insurance 133 319
Foreclosure 200 168
Marketing 134 111
Other general and administrative   625   587
Total operating expenses   4,077   3,911
Income before income taxes 5,466 4,856
Income tax provision   2,225   1,976
Net income $ 3,241 $ 2,880
 
Cash dividends declared per common share $ 0.25 $ 0.24
 
Weighted average shares outstanding:
Basic   2,126   2,124
Diluted   2,127   2,125
 
Earnings per share:
Basic $ 1.52 $ 1.36
Diluted $ 1.52 $ 1.35
   
 

HINGHAM INSTITUTION FOR SAVINGS

Net Interest Income Analysis
 
Three Months Ending March 31,
2012       2011

AVERAGE BALANCE
     

INTEREST
     

YIELD/ RATE

AVERAGE BALANCE
     

INTEREST
     

YIELD/ RATE
(Dollars in thousands)
(Unaudited)
 
Loans (1) (2) $ 864,131 $ 11,843 5.48 % $ 806,714 $ 11,568 5.74 %
Securities (3) (4) 97,387 191 0.78 107,945 273 1.01
Short-term investments and certificates of deposit   115,706   89 0.31   72,365   82 0.45
Total earning assets 1,077,224   12,123 4.50 987,024   11,923 4.83
Other assets   46,899   34,203
Total assets $ 1,124,123 $ 1,021,227
 
Interest-bearing deposits (5) $ 735,651 1,506 0.82 $ 682,247 1,758 1.03
Borrowed funds   236,817   1,256 2.12   206,527   1,509 2.92
Total interest-bearing liabilities 972,468   2,762 1.14 888,774   3,267 1.47
Demand deposits 63,352 54,222
Other liabilities   3,547   3,266
Total liabilities 1,039,367 946,262
Stockholders’ equity   84,756   74,965

Total liabilities and stockholders’ equity
$ 1,124,123 $ 1,021,227
Net interest income $ 9,361 $ 8,656
 
Weighted average spread 3.36 % 3.36 %
 
Net interest margin (6) 3.48 % 3.51 %
 

Average interest-earning assets to average interest-bearing liabilities (7)

110.77

%

111.05

%
(1)     Before allowance for loan losses.
(2) Includes non-accrual loans.
(3) Excludes the impact of the average net unrealized gain or loss on securities available for sale.
(4) Includes Federal Home Loan Bank stock.
(5) Includes mortgagors' escrow accounts.
(6) Net interest income divided by average total earning assets.
(7) Total earning assets divided by total interest-bearing liabilities.
       
 

HINGHAM INSTITUTION FOR SAVINGS

Selected Financial Ratios
 
Three Months Ended

March 31,
2012     2011
(Unaudited)
 
Key Performance Ratios
Return on average assets (1)

1.15

%
1.13 %
Return on average equity (1) 15.30 15.37
Interest rate spread (1) (2) 3.36 3.36
Net interest margin (1) (3) 3.48 3.51
Non-interest expense to average assets (1) 1.45 1.53
Efficiency ratio (4) 41.74 43.13
Average equity to average assets 7.54 7.34

Average interest-bearing assets to average interest bearing liabilities

 

110.77

111.05
 

March 31, 2012
 

December 31, 2011

March 31, 2011
(Unaudited)
 
Asset Quality Ratios
Allowance for loan losses/total loans 0.87 % 0.88 %   0.89 %
Allowance for loan losses/non-performing loans 120.09 111.30 110.80
 
Non-performing loans/total loans 0.73 0.79 0.81
Non-performing loans/total assets 0.55 0.60 0.63
Non-performing assets/total assets 0.89 0.92 0.92
 
Share Related
Book value per share $ 39.94 $ 38.70 $ 35.31
Market value per share $ 56.44 $ 47.80 $ 51.51
Shares outstanding at end of period 2,125,750 2,125,750 2,124,250
(1)     Annualized
(2) Interest rate spread represents the difference between the yield on earning assets and cost of interest-bearing liabilities.
(3) Net interest margin represents net interest income divided by average earning assets.
(4) The efficiency ratio represents non-interest expense, divided by the sum of net interest income and non-interest income.

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