HELENA, Mont., April 17, 2008 (PRIME NEWSWIRE) -- Eagle Bancorp ("Eagle") (OTCBB:EBMT), the stock holding company of American Federal Savings Bank (the "Bank"), reported net income of $538,000, or $0.50 per share ($0.44 per share diluted), for the three months ended March 31, 2008 and declared a cash dividend of $0.24 per share. Earnings for the quarter increased by 18.76% from the $453,000 earned for the quarter ended March 31, 2007. Earnings for the nine month period ended March 31, 2008 were $1,221,000, or $1.14 per share ($1.01 per share diluted), a decrease of $115,000, or 8.61%, compared to $1,336,000 for the nine month period ended March 31, 2007. "We are pleased with our growth in retail deposits for this quarter and for our growth in net interest income the nine month period ending March 31, 2008. Excluding the losses in market value on the preferred stock held in our investment portfolio, our financial performance has been strong. Our credit quality remains excellent, with loan delinquencies at a level well below our peers," said CEO Pete Johnson.
The increase in net income for the third quarter was the result of increases in net interest income of $107,000 and noninterest income of $75,000, offset by an increase in noninterest expense of $101,000. Eagle's tax provision was $4,000 lower in the current quarter.
Net loss on securities accounted for under FAS 159, reported within noninterest income, increased substantially due to a loss in market value on investments in certain preferred stock, issued by Fannie Mae and Freddie Mac. Under Statement of Financial Accounting Standard (SFAS) No. 159, "Fair Value Option for Financial Assets and Financial Liabilities," a company elects fair value for the initial and subsequent measurement for certain financial assets and liabilities on a contract-by-contract basis, and subsequent changes in fair value are recognized in earnings when incurred. For the quarter, the market value of Fannie Mae and Freddie Mac preferred stock, owned by Eagle, decreased $118,000.
Eagle's annualized return on assets was 0.83%, and its annualized return on equity was 8.45% for the quarter, compared with 0.76% and 7.51%, respectively, for the same quarter in 2007.
Total interest and dividend income increased $214,000 to $3,474,000 for the quarter ended March 31, 2008 from $3,260,000 for the quarter ended March 31, 2007. This was due primarily to an increase in interest and fees on loans of $241,000. Higher funding costs caused total interest expense to increase by $107,000 to $1.64 million for the quarter ended March 31, 2008 from $1.53 million for the quarter ended March 31, 2007. Interest expense on deposits increased $24,000 and interest expense on borrowings increased $83,000.
Earnings for the nine month period ended March 31, 2008 were $1,221,000, or $1.14 per share ($1.01 per share diluted), a decrease of $115,000, or 8.61%, compared to $1,336,000, or $1.25 per share ($1.11 per share diluted) for the nine month period ended March 31, 2007. The decrease in net income for the period was the result of an increase in net interest income of $309,000, offset by a decrease in noninterest income of $201,000 and an increase in noninterest expense of $279,000. Eagle's tax provision was $56,000 lower in the current period. Net interest income was higher, as the interest costs of funding decreased faster during the period than decreases in the yield on earning assets. The decrease in noninterest income was primarily attributable to the recognition of a decline in value of $549,000 on Fannie Mae and Freddie Mac preferred stock as described above. Noninterest expense increase was primarily due to an increase in salaries and employee benefits of $257,000 resulting from merit raises, inflationary costs, and a slightly larger staff. Eagle's annualized return on assets was 0.63% and its annualized return on equity was 6.53%, compared with 0.76% and 7.59%, respectively, for the same nine month period in 2007.
Total assets increased by $23.61 million, or 9.65%, to $268.3 million at March 31, 2008 from $244.69 million at June 30, 2007. Loans receivable increased $6.56 million, or 4.1%, to $164.7 million from $158.14 million. Loans held-for-sale increased to $1.49 million from $1.18 million. Deposits decreased $507,000, or 0.28%, to $179.14 million at March 31, 2008 from $179.65 million at June 30, 2007. Advances from the Federal Home Loan Bank and other borrowings increased $26.0 million, or 86.67%, to $56.0 million from $30.0 million, while federal fund purchases decreased from $3.8 million to zero. Total stockholders' equity increased $1.71 million, or 7.08%, to $25.79 million at March 31, 2008 from $24.09 million at June 30, 2007, as a result of the net income for the period of $1,221,000 and a decrease in accumulated other comprehensive loss of $1,007,000 (mainly due to a decrease in net unrealized loss on securities available-for-sale). These were partially offset by dividends paid and purchases of treasury stock.
Eagle's Board of Directors declared a quarterly cash dividend of $0.24 per share for the third quarter of Eagle's fiscal year. The dividend is payable May 9, 2008 to shareholders of record at the close of business on April 25, 2008.
American Federal Savings Bank was formed in 1922 and is headquartered in Helena, Montana. It has additional branches in Butte, Bozeman, and Townsend. Eagle's common stock trades on the OTC Bulletin Board under the symbol "EBMT." Eagle is a subsidiary of Eagle Financial MHC, a federal mutual holding company formed in 2000, which owns approximately 59% of Eagle Bancorp's outstanding common stock.
This release may contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Eagle intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and is including this statement for purposes of these safe harbor provisions.
Financial highlights for Eagle Bancorp follow.
EAGLE BANCORP AND SUBSIDIARY
(consolidated)
(Dollars in Thousands)
March 31, 2008 June 30, 2007
(Unaudited) (Audited)
ASSETS
Cash and due
from banks 3,708 2,709
Interest-bearing
deposits with banks 3,553 360
-------------- -------------
Total cash and
cash equivalents 7,261 3,069
Investment securities FAS 159,
at market value 1,283 0
Investment securities
available-for-sale, at
market value 75,385 64,774
Investment securities
held-to-maturity, at cost 711 921
Investment in nonconsolidated
subsidiary 155 155
Federal Home Loan Bank stock,
at cost 1,315 1,315
Mortgage loans held-for-sale 1,486 1,175
Loans receivable, net of
deferred loan fees and
allowance for loan losses
of $495 at March 31, 2008
and $518 at June 30, 2007 164,701 158,140
Accrued interest and
dividends receivable 1,416 1,333
Mortgage servicing rights, net 1,639 1,628
Property and equipment, net 6,426 5,806
Cash surrender value of
life insurance 6,225 5,764
Real estate acquired in
settlement of loans,
net of allowance for losses 0 0
Other assets 293 606
-------------- -------------
Total assets 268,296 244,686
============== =============
LIABILITIES
Deposit accounts:
Noninterest bearing 13,536 13,694
Interest bearing 165,604 165,953
-------------- -------------
Total deposits 179,140 179,647
Federal Funds Purchased 0 3,800
Advances from Federal Home
Loan Bank and Other Borrowings 56,000 30,000
Long-Term Subordinated
Debentures 5,155 5,155
Accrued expenses and
other liabilities 2,207 1,996
-------------- -------------
Total liabilities 242,502 220,598
EQUITY
Preferred stock (no par value,
1,000,000 shares authorized,
none issued or outstanding)
Common stock (par value
$0.01 per share; 9,000,000
shares authorized; 1,223,572
shares issued; 1,078,072 and
1,084,357 shares outstanding
at March 31, 2008 and
June 30, 2007, respectively) 12 12
Additional paid-in capital 4,464 4,387
Unallocated common stock held
by employee stock ownership
plan ("ESOP") (64) (92)
Treasury stock, at cost
(145,500 and 139,215 shares
at March 31, 2008 and
June 30, 2007, respectively) (4,957) (4,759)
Retained earnings 26,240 25,448
Accumulated other
comprehensive (loss) income 99 (908)
-------------- -------------
Total equity 25,794 24,088
Total liabilities and equity 268,296 244,686
============== =============
EAGLE BANCORP AND SUBSIDIARY
Consolidated Statements of Income
(In Thousands, except for Per Share Data)
Three Months Nine Months
Ended Ended
March 31, March 31,
(unaudited) (unaudited)
---------------------- ----------------------
2008 2007 2008 2007
---------- ---------- ---------- ----------
Interest and
Dividend Income:
Interest and
fees on loans $2,750 $2,509 $8,169 $7,198
Interest on
deposits with banks 20 11 54 39
Securities
held-to-maturity 8 11 26 33
Securities
available-for-sale 692 726 2,118 2,082
FHLB Stock dividends 4 3 9 4
---------- ----------- ---------- ----------
Total interest and
dividend income 3,474 3,260 10,376 9,356
---------- ----------- ---------- ----------
Interest Expense:
Deposits 1,096 1,072 3,452 3,048
Advances and other
borrowings 468 385 1,378 1,071
Subordinated
debentures 75 75 225 225
---------- ----------- ---------- ----------
Total interest
expense 1,639 1,532 5,055 4,344
---------- ----------- ---------- ----------
Net Interest Income 1,835 1,728 5,321 5,012
Loan loss provision 0 0 0 0
---------- ----------- ---------- ----------
Net interest income
after loan loss
provision 1,835 1,728 5,321 5,012
---------- ----------- ---------- ----------
Noninterest income:
Net gain on sale
of loans 164 153 546 462
Demand deposit
service charges 191 114 547 377
Mortgage loan
servicing fees 136 134 406 405
Net gain on sale of
available-for-sale
securities 72 (5) 72 (4)
Net gain (loss) on
securities FAS 159 (118) 0 (549) 0
Other 174 148 450 433
---------- ----------- ---------- ----------
Total noninterest
income 619 544 1,472 1,673
---------- ----------- ---------- ----------
Noninterest expense:
Salaries and
employee benefits 998 943 2,952 2,695
Occupancy expenses 136 135 401 410
Furniture and
equipment
depreciation 69 69 210 216
In-house computer
expense 86 70 244 211
Marketing expense 52 43 185 196
Amortization of mtg
servicing fees 83 66 224 215
Federal insurance
premiums 5 5 15 16
Postage 23 25 79 64
Legal,accounting,
and examination
fees 48 54 169 178
Consulting fees 26 20 48 56
ATM processing 13 13 40 35
Other 222 217 649 645
---------- ----------- ---------- ----------
Total noninterest
expense 1,761 1,660 5,216 4,937
---------- ----------- ---------- ----------
Income before
provision for
income taxes 693 612 1,577 1,748
---------- ----------- ---------- ----------
Provision for income
taxes 155 159 356 412
---------- ----------- ---------- ----------
Net income $538 $453 $1,221 $1,336
========== =========== ========== ==========
Basic earnings
per share $0.50 $0.42 $1.14 $1.25
========== =========== ========== ==========
Diluted earnings
per share $0.44 $0.37 $1.01 $1.11
========== =========== ========== ==========
Weighted average
shares outstanding
(basic eps) 1,070,070 1,072,347 1,071,124 1,072,849
========== =========== ========== ==========
Weighted average
shares outstanding
(diluted eps) 1,214,762 1,210,162 1,213,610 1,209,011
========== =========== ========== ==========
CONTACT: Eagle BancorpPeter J. Johnson, President and Chief Executive Officer
(406) 457-4006
Clint J. Morrison, Senior Vice President and Chief Financial
Officer
(406) 457-4007