The Bank continues to work diligently to address non-performing assets. During the quarter ended June 30, 2013, the Bank sold $141,000 of real estate owned with no new additions to real estate owned. Total non-performing assets, which include $1.8MM of repossessed assets, decreased $600,000, or 10.5%, during the quarter to $5.1MM as of June 30, 2013, as compared to $5.7MM as of March 31, 2013. Non-performing assets decreased $1.1MM, or 17.7%, from $6.2MM at June 30, 2012.
Gross loans were $48.0MM at June 30, 2013, which is unchanged from the prior quarter. The Bank continues to lend to qualified borrowers and is actively seeking qualified borrowers. During the quarter just ended, the Bank originated and refinanced $3.6MM in loans. Year to date the Bank has originated and refinanced $6.6MM in loans. With the improving economy in Missoula, the Bank has seen some existing loans payoff. However, in several cases the payoffs have enhanced the quality of the Bank's loan portfolio.
The Bank continues to work diligently to reduce its cost of funds. At June 30, 2013 the cost of funds was 0.91% as compared to 0.97% at March 31, 2013 and 1.19% at June 30, 2012.
Nearly eighteen cents of every dollar is held in domestic liquid assets to cushion the Bank from a rising interest rate environment and to allow for the funding of new loans. In addition, the investment securities that the Bank owns have very short term maturities, which will not fluctuate significantly in market value should interest rates increase. A significant increase in interest rates would result in reduced loan fees earned on loans originated for sale to the secondary markets. These loan fees have been a significant source of income for the Bank, as well as for the banking industry."For more information regarding this release, or the Bank in general, you may contact James A. Salisbury, President and CEO, at 406-543-8700.