PVF Capital Corp. Announces Fiscal 2012 Fourth-Quarter Earnings And Full-Year Financial Results
Net Interest Income Improves
Net interest income continued to improve during the quarter to $5.7 million, an increase of $12,000, or 0.2%, over the linked quarter ended March 31, 2012. In this continued low-rate environment, the Company has been able to lower its funding costs at a slightly greater amount than the decline in the yield on its earning assets. This improvement is largely attributable to a higher level of performing interest-earning assets as the Company continues to successfully resolve and reduce its level of nonperforming assets. The net interest margin for the quarter was 3.07%, a slight decrease from the prior quarter net interest margin of 3.10%, as the mix of the higher level of interest-earning assets was less favorable as the Company works to redeploy its overnight funds position.
Compared with the year-ago quarter ended June 30, 2011, net interest income for the quarter increased $0.3 million, or 4.8%. The net interest margin improved 12 basis points from the prior-year net interest margin of 2.95%. This improvement is also attributable to the reduced level of nonperforming assets along with the strategic increase in, as well as a change in the mix of, average earning assets.
Mortgage Banking Activity Remains Strong, Boosting Non-interest Income Compared with Prior-Year QuarterMortgage banking volumes remained strong during the quarter ended June 30, 2012, as a result of the historical low interest rate environment and home refinance programs. Revenue from mortgage banking activities totaled $3.0 million during the quarter. Although mortgage banking volumes were strong, they were slightly lower than the quarter ended March 31, 2012, resulting in a comparative decline of $0.3 million. Non-interest income totaled $3.0 million for the quarter, a decrease of $0.2 million from the previous quarter. Contributing to the strong level of non-interest income, the Company realized a gain of $0.2 million from its Small Business Administration lending program as this new initiative takes hold. Partially offsetting this pick-up in non-interest income was an increase in credit-related costs associated with other real estate owned, which increased $0.1 million compared with the prior quarter and totaled $0.7 million. The credit-related costs resulted from updated valuations on other real estate owned and losses on property dispositions.
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