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Jefferson Bancshares, Inc. (NASDAQ: JFBI), the holding company for Jefferson Federal Bank (the “Bank”), announced net income for the quarter ended June 30, 2012 of $291,000, or $0.05 per diluted share, compared to a net loss of $848,000, or $0.14 per diluted share, for the quarter ended June 30, 2011.
For the fiscal year ended June 30, 2012, the Company reported a net loss of $4.0 million, or $0.64 per diluted share, compared to net income of $30,000, or $0.00 per diluted share, for the fiscal year ended June 30, 2011. Financial results for the fiscal year ended June 30, 2012 were negatively impacted by a $9.9 million provision for loan losses compared to a provision of $4.4 million for the fiscal year ended June 30, 2011. The increase in the provision for loan losses was attributable to higher realized and estimated losses.
Anderson L. Smith, President and Chief Executive Officer, commented, “The resolution of nonperforming assets continues to be the primary focus for management. Although our level of nonperforming assets remains elevated, we are encouraged by positive trends in many areas of the Bank. The extended low interest rate environment continues to pressure asset yields, however, we have been successful in lowering funding costs to offset decreases in asset yields and in improving the deposit mix. Our liquidity position is strong and our capital ratios continue to exceed those required to be considered “well capitalized” for regulatory purposes.”
Net interest income decreased $481,000, or 10.1%, to $4.3 million for the quarter ended June 30, 2012 compared to $4.8 million for the same period in 2011. The net interest margin was 3.68% for the quarter ended June 30, 2012 compared to 3.80% for the same period in 2011. The decrease in the net interest margin was attributable to a shift in the asset mix to higher levels of lower yielding investments and unfavorable asset repricing. These decreases were partially offset by lower rates paid on deposits and a lower average balance of higher-costing time deposits. For the fiscal year ended June 30, 2012, net interest income declined $442,000 to $17.9 million compared to $18.3 million for the fiscal year ended June 30, 2011, while the net interest margin increased 37 basis points to 3.72% compared to 3.35% for fiscal 2011.