MSB Financial Corp. Releases First Quarter Earnings

MILLINGTON, N.J., April 29, 2016 (GLOBE NEWSWIRE) -- MSB Financial Corp. (NASDAQ:MSBF) (the "Company"), parent company of Millington Bank, reported today the results of its operations for the three months ended March 31, 2016. 

The Company reported net income of $159,000 for the three months ended March 31, 2016, compared to net income of $216,000 for the three months ended March 31, 2015. Net income per diluted common share was $0.03 for the three months ended March 31, 2016 and $0.04 for the three months ended March 31, 2015. The results of operations for the three months ended March 31, 2015 reflect the results of operations of MSB Financial Corp., a federal corporation which was the predecessor company to the Company.

Total assets were $380.1 million at March 31, 2016, compared to $375.7 million at December 31, 2015, an increase of $4.4 million or 1.2%. During 2016, the Company experienced growth of $8.4 million or 3.2%, in loans receivable, net. Commercial and multi-family real estate loans continued to have the most growth during the first three months of 2016 as the Company continues to diversify its loan portfolio.

The following table summarizes loan balances and composition at March 31, 2016 and December 31, 2015:
  At     At  
March 31,   December 31,  
(In thousands) 2016     2015  
                       
Residential mortgage:                      
One-to-four family $ 155,764   55.9 %   $ 154,624   57.1 %
Home equity   34,484   12.4       35,002   12.9  
                       
Total residential mortgage   190,248   68.3       189,626   70.0  
                       
Commercial and multi-family real estate   65,227   23.4       59,642   22.0  
Construction   11,280   4.0       10,895   4.0  
Commercial and industrial   11,399   4.1       10,275   3.8  
                       
Total commercial loans   87,906   31.5       80,812   29.8  
                       
Consumer loans   371   0.2       493   0.2  
                       
Total loans receivable   278,525   100.0 %     270,931   100.0 %
                       
Less:                      
Loans in process   3,729           4,600      
Deferred loan fees   412           417      
Allowance   3,671           3,602      
                       
Total loans receivable, net $ 270,713         $ 262,312      
                       

Total deposits at March 31, 2016 were $276.8 million compared with $262.6 million at December 31, 2015.  Overall, deposits increased by $14.2 million, or 5.4% with most of the growth occurring in interest demand deposits of $8.0 million or 19.1%. Noninterest demand deposits also increased $5.0 million, or 17.6%. Most of the growth in these two categories was attributable to developing stronger relationships with our commercial and small business customers.

The following table summarizes deposit balances and composition at March 31, 2016 and December 31, 2015:

  At     At  
(Dollars in thousands) March 31, 2016     December 31, 2015  
                   
Noninterest demand $ 33,139     11.97 %   $ 28,173     10.73 %
Interest demand   49,875     18.02       41,893     15.95  
Savings   103,575     37.41       102,196     38.92  
Money Market   5,211     1.88       4,928     1.88  
                   
Total demand deposits   191,800     69.28       177,190     67.48  
                   
Certificates of Deposit   85,041     30.72       85,408     32.52  
                   
Total Deposits $ 276,841     100.00 %   $ 262,598     100.00 %
                           

"We are pleased with the progress we have made during the first quarter of 2016," stated Michael A. Shriner, President and Chief Executive Officer.  "Much of our staff has been focused on our core system conversion, which will occur in May 2016, as well as normal activities.   The investment in our infrastructure will position us well for the years ahead and we are looking forward to our transition.  The organization remains committed to continue to enhance and strengthen its defenses specifically as they relate to mitigating the ever increasing risk of cybersecurity."

Mr. Shriner added, "So far in 2016, our efforts have resulted in the positive growth and diversification of the organization's deposit portfolio as well as its loan portfolio.  We are encouraged that this ongoing strategy has provided a favorable expansion of the company's net interest margin."

Forward Looking Statement Disclaimer

The foregoing release may contain forward-looking statements concerning the financial condition, results of operations and business of the Company. We caution that such statements are subject to a number of uncertainties and actual results could differ materially, and, therefore, readers should not place undue reliance on any forward-looking statements. Factors that may cause actual results to differ from those contemplated include our continued ability to grow the loan portfolio, the successful conversion of our core system and our continued ability to manage cybersecurity risks.

MSB FINANCIAL CORP      
(In Thousands, except for per share amount)   (Unaudited) (Unaudited)
Statement of Financial Condition Data:   03/31/2016 03/31/2015
Total assets   $ 380,134   $ 347,455  
       
Cash and cash equivalents     14,515     6,849  
       
Loans receivable, net     270,713     239,274  
       
Securities held to maturity     73,603     78,228  
       
Deposits     276,841     265,760  
       
Federal Home Loan Bank advances     22,675     37,100  
       
Total stockholders' equity     76,560     41,290  
       
Stock Information:      
Number of shares of common stock outstanding     5,953     5,010  
Book value per share of common stock   $ 12.86   $ 8.24  
Closing market price   $ 12.85   $ 11.41  
 

Summary of Operations: (In Thousands, except for per share amounts) (Unaudited)For the three months ended March 31,
  2016     2015  
Total interest income $ 3,298   $ 2,934  
         
Total interest expense   510     554  
         
Net interest income   2,788     2,380  
         
Provision (credit) for loan losses   130     (52 )
         
Net interest income after provision (credit) for loan losses   2,658     2,432  
         
Non-interest income   141     163  
         
Non-interest expense   2,564     2,258  
         
Income before taxes   235     337  
         
Income tax expense   76     121  
         
Net income $ 159   $ 216  
         
Net income per common share - basic $ 0.03   $ 0.04  
Net income per common share - diluted $ 0.03   $ 0.04  
         
Weighted average number of shares - basic   5,743     5,637  
Weighted average number of shares - diluted   5,812     5,637  
         
Performance Ratios:        
Return on average assets annualized   0.17 %   0.25 %
Return on average common equity annualized   0.83 %   2.10 %
Net interest margin   3.12 %   3.00 %
Efficiency ratio   87.54 %   88.79 %
Operating expenses / average assets annualized   2.73 %   2.65 %
 

  For the three months ended
        03/31/16             03/31/15      
Average Balance Sheet (In Thousands) AverageBalance Interest Income/Expense Yield AverageBalance Interest Income/Expense Yield
Interest-earning assets:            
Loans Receivable $ 271,815   $ 2,838     4.18 % $ 235,387   $ 2,508     4.26 %
Securities held to maturity   76,932     431     2.24     78,461     404     2.06  
Other interest-earning assets   8,430     29     1.38     3,176     22     2.77  
Total interest-earning assets   357,177     3,298     3.69     317,024     2,934     3.70  
                     
Allowance for Loan Loss   (3,622 )       (3,587 )    
Non-interest-earning assets   21,646         26,758      
Total non-interest-earning assets   18,024         23,171      
                     
Total Assets $ 375,201       $ 340,195      
             
Interest-bearing liabilities:            
NOW & Money Market $ 48,453   $ 21     0.17 % $ 45,667   $ 17     0.15 %
Savings and club deposits   102,445     56     0.22     100,350     53     0.21  
Certificates of deposit   84,437     237     1.12     92,658     295     1.27  
Total interest-bearing deposits   235,335     314     0.53     238,675     365     0.61  
             
Federal Home Loan Bank advances   29,754     196     2.63     31,783     189     2.38  
Total interest-bearing liabilities   265,089     510     0.77     270,458     554     0.82  
             
Non-interest-bearing deposit   29,621         25,638      
Other non-interest-bearing liabilities   3,820         2,882      
Total Liabilities   298,530         298,978      
             
Equity   76,671         41,217      
Total Liabilities and Equity $ 375,201       $ 340,195      
             
Net Interest Spread     2,788     2.92 %     2,380     2.88 %
             
Net Interest Margin       3.12 %       3.00 %
             
Ratio of Interest Earning Assets to Interest Bearing Liabilities   134.74 %       117.22 %    
             

 
Contact:	Michael A. Shriner, President & CEO (908) 647-4000 mshriner@millingtonbank.com

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