Home Financial Bancorp Announces First Quarter Results

Home Financial Bancorp ("Company") (OTC Symbol "HWEN"), an Indiana corporation which is the holding company for Our Community Bank, ("Bank") based in Spencer, Indiana, announces unaudited results for the first quarter ended September 30, 2016.

First Quarter Highlights:
  • Total assets increased $2.9 million or 4%;
  • Non-interest income increased $37,000 or 26%;
  • Non-interest expense decreased $87,000 or 11%;
  • Net income improved $68,000, to $82,000.

For the quarter ended September 30, 2016, the Company reported net income of $82,000 or $.07 basic and diluted earnings per share. Net income totaled $14,000 or $.01 basic and diluted earnings per share for the quarter ended September 30, 2015. An increase in non-interest income and lower non-interest expense resulted in higher net income compared to the same period a year earlier.

Net interest income decreased 4% to $652,000 for the three months ended September 30, 2016. Total interest income declined $36,000 or 5%, while interest expense fell $12,000, or 11%. Net interest margin for the quarter was 4.17%, compared to 4.35% a year earlier.

Loan loss provisions were steady at $20,000 for the quarters-ended September 30, 2016, and the year-earlier period. A regular assessment of loan loss allowance adequacy indicated that these provisions were required to maintain an appropriate allowance level. Changes in volume, composition and quality of the loan portfolio, as well as actual loan loss experience, will influence the need for future loan loss provisions.

Non-interest income increased $37,000 or 26%, compared to the year-earlier period. This change was due to gain on sale of securities totaling $39,000 during first quarter 2017. No gains on sale of securities were reported for the same period a year earlier. Non-interest expense declined $87,000 or 11%. Repossessed property expense decreased $66,000 and rental expenses decreased $41,000, compared to the same period a year earlier.

At September 30, 2016, total assets were $67.4 million, an increase of $2.9 million, or 4% from $64.5 million at June 30, 2016. During fiscal first quarter 2017, cash and cash equivalents increased $537,000 and investment securities decreased $900,000. Total loans were stable at $44.3 million and interest-bearing time deposits with other banks increased by $3.2 million from June 30, 2016 to September 30, 2016. The growth in assets was funded by a $2.9 million, or 6% increase in total deposits.

Loans delinquent 90 days or more decreased 3% to $673,000, or 1.5% of total loans at September 30, 2016. Three months earlier, non-performing loans were at $692,000 or 1.6% of total loans. Non-performing assets, which includes non-performing loans, were $943,000, or 1.4% of total assets, at September 30, 2016. Non-performing assets totaled $947,000, or 1.5% of assets, at June 30, 2016. Non-performing assets included $270,000 in Other Real Estate Owned ("OREO") and other repossessed properties at September 30, 2016, compared to $255,000 three months earlier.

The allowance for loan losses was $442,000 at September 30, 2016, compared to $454,000 at June 30, 2016. Loan loss allowances were 1.00% of total loans at September 30, 2016, and 1.02% at June 30, 2016. Net loans charged off during the quarter ended September 30, 2016 totaled $32,000, compared to $30,000 for the first quarter of fiscal 2016. Periodic provisions to loan loss allowances reflect management's view of risk in the Bank's entire portfolio due to a number of dynamic factors, which include, but are not limited to, current economic conditions and loan delinquency trends. Management considered the level of loan loss allowances at September 30, 2016 to be adequate to cover probable incurred losses inherent in the loan portfolio at that date.

Total deposits were $49.7 million as of September 30, 2016, compared to $46.7 million three months earlier. Total borrowings were unchanged at $8.5 million for quarters-ended September 30, 2016 and June 30, 2016.

Shareholders' equity was $8.8 million or 13.0% of total assets at September 30, 2016. Factors affecting shareholders' equity during the quarter included net income, quarterly cash dividends of $.035 per share, a $43,000 net decrease in the market value of securities available for sale, and the repurchase of 9,701 shares of its common stock at a total cost of $58,454. Based on 1,166,002 shares outstanding, the Company's book value per share was $7.53 at September 30, 2016.

Home Financial Bancorp and Our Community Bank, an FDIC-insured, state stock commercial bank, operate from headquarters in Spencer, Indiana, and a branch office in Cloverdale, Indiana. Additional information concerning Home Financial Bancorp and its subsidiaries is available at www.hfbancorp.com or www.ocbconnect.com.
 

HOME FINANCIAL BANCORP

Consolidated Financial Highlights
(Dollars in thousands, except per share and book value amounts)
 
 

FOR THREE MONTHS ENDED SEPTEMBER 30:
 

2016
 

2015
Net Interest Income 652 676
Provision for Loan Losses 20 20
Non-interest Income 178 141
Non-interest Expense 712 799
Income Tax 16 (16 )
Net Income 82 14
 
Basic Earnings Per Share: $ .07 $ .01
Diluted Earnings Per Share: .07 .01
Average Shares Outstanding - Basic 1,165,645 1,189,093
Average Shares Outstanding - Diluted 1,165,745 1,189,718
 

September 30,

June 30,

2016

2016
Total Assets $ 67,406 $ 64,548
Total Loans 44,347 44,311
Allowance for Loan Losses 442 454
Total Deposits 49,667 46,738
Borrowings

8,500
8,500
Shareholders' Equity

8,777
8,836
 
Non-Performing Assets 943 947
Non-Performing Loans 673 692
 
Non-Performing Assets to Total Assets 1.41 % 1.47 %
Non-Performing Loans to Total Loans 1.52 % 1.56 %
 
Book Value Per Share* $ 7.53 $ 7.52
 

*Based on 1,166,002 shares at September 30, 2016 and 1,175,703 shares at June 30, 2016.

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