ý
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
For
the quarterly period ended
|
September
30, 2007
|
o
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
WAYNE
SAVINGS BANCSHARES, INC.
|
(Exact
name of registrant as specified in its
charter)
|
Delaware
|
31-1557791
|
|
(State
or other jurisdiction of
|
(I.R.S.
Employer
|
|
incorporation
or organization)
|
Identification
Number)
|
|
151
North Market Street
|
||
Wooster,
Ohio
|
44691
|
|
(Address
of principal
|
(Zip
Code)
|
|
executive
office)
|
Yes
ý
|
No
o
|
Large
accelerated filer o
|
Accelerated
filer o
|
Non-accelerated
filer ý
|
Yes
o
|
No
ý
|
Page
|
||
3
|
||
4
|
||
5
|
||
6
|
||
8
|
||
12
|
||
23
|
||
23
|
||
24
|
||
24
|
||
24
|
||
24
|
||
24
|
||
25
|
||
25
|
||
26
|
September
30,
|
March
31,
|
|||||||
ASSETS
|
2007
|
2007
|
||||||
(Unaudited)
|
||||||||
Cash
and due from banks
|
$ |
2,227
|
$ |
2,194
|
||||
Federal
funds sold
|
2,400
|
9,000
|
||||||
Interest-earning
deposits in other financial institutions
|
5,286
|
6,021
|
||||||
Cash
and cash equivalents
|
9,913
|
17,215
|
||||||
Investment
securities available for sale - at fair value
|
44,167
|
54,128
|
||||||
Investment
securities held to maturity - at amortized cost,
approximate
|
||||||||
fair
value of $518 and $573 at September 30, 2007 and March 31,
2007,
|
||||||||
Respectively
|
512
|
565
|
||||||
Mortgage-backed
securities available for sale - at fair value
|
73,413
|
67,856
|
||||||
Mortgage-backed
securities held to maturity - at amortized cost,
approximate
|
||||||||
fair
value of $959 and $1,219 at September 30, 2007 and March 31,
2007,
|
||||||||
Respectively
|
955
|
1,209
|
||||||
Loans
receivable - net of allowance for loan losses of $1,605 and
$1,523
|
||||||||
at
September 30, 2007 and March 31, 2007, respectively
|
245,443
|
240,049
|
||||||
Office
premises and equipment - net
|
8,113
|
8,179
|
||||||
Real
estate acquired through foreclosure
|
7
|
-
|
||||||
Federal
Home Loan Bank stock - at cost
|
4,829
|
4,829
|
||||||
Cash
surrender value of life insurance
|
6,150
|
6,034
|
||||||
Accrued
interest receivable on loans
|
1,136
|
1,100
|
||||||
Accrued
interest receivable on mortgage-backed securities
|
338
|
314
|
||||||
Accrued
interest receivable on investments and interest-bearing
deposits
|
456
|
667
|
||||||
Prepaid
expenses and other assets
|
1,046
|
1,065
|
||||||
Goodwill
and other intangible assets
|
2,348
|
2,402
|
||||||
Prepaid
federal income taxes
|
92
|
125
|
||||||
Total
assets
|
$ |
398,918
|
$ |
405,737
|
||||
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||||||
Deposits
|
$ |
322,631
|
$ |
333,540
|
||||
Advances
from the Federal Home Loan Bank
|
39,000
|
34,500
|
||||||
Advances
by borrowers for taxes and insurance
|
656
|
616
|
||||||
Accrued
interest payable
|
471
|
383
|
||||||
Accounts
payable on mortgage loans serviced for others
|
178
|
197
|
||||||
Other
liabilities
|
1,025
|
1,071
|
||||||
Deferred
federal income taxes
|
889
|
997
|
||||||
Total
liabilities
|
364,850
|
371,304
|
||||||
Commitments
|
-
|
-
|
||||||
Stockholders’
equity
|
||||||||
Preferred
stock (500,000 shares of $.10 par value authorized; no
|
||||||||
shares
issued)
|
-
|
-
|
||||||
Common
stock (9,000,000 shares of $.10 par value authorized;
3,978,731
|
||||||||
shares
issued)
|
398
|
398
|
||||||
Additional
paid-in capital
|
36,106
|
36,106
|
||||||
Retained
earnings - substantially restricted
|
12,292
|
11,982
|
||||||
Less
required contributions for shares acquired by Employee
Stock
|
||||||||
Ownership
Plan
|
(1,158 | ) | (1,158 | ) | ||||
Less
835,409 and 784,622 shares of treasury stock at September 30,
2007
|
||||||||
and
March 31, 2007, respectively - at cost
|
(13,062 | ) | (12,419 | ) | ||||
Accumulated
comprehensive loss, net of tax benefits
|
(508 | ) | (476 | ) | ||||
Total
stockholders’ equity
|
34,068
|
34,433
|
||||||
Total
liabilities and stockholders’ equity
|
$ |
398,918
|
$ |
405,737
|
Six
months
|
Three
months
|
|||||||||||||||
ended
|
ended
|
|||||||||||||||
September
30,
|
September
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Interest
income
|
||||||||||||||||
Loans
|
$ |
8,314
|
$ |
7,876
|
$ |
4,224
|
$ |
3,985
|
||||||||
Mortgage-backed
securities
|
1,907
|
1,481
|
985
|
782
|
||||||||||||
Investment
securities
|
1,005
|
1,455
|
473
|
712
|
||||||||||||
Interest-bearing
deposits and other
|
266
|
202
|
111
|
99
|
||||||||||||
Total
interest income
|
11,492
|
11,014
|
5,793
|
5,578
|
||||||||||||
Interest
expense
|
||||||||||||||||
Deposits
|
5,069
|
4,649
|
2,538
|
2,417
|
||||||||||||
Borrowings
|
823
|
628
|
437
|
345
|
||||||||||||
Total
interest expense
|
5,892
|
5,277
|
2,975
|
2,762
|
||||||||||||
Net
interest income
|
5,600
|
5,737
|
2,818
|
2,816
|
||||||||||||
Provision
for losses on loans
|
55
|
60
|
25
|
30
|
||||||||||||
Net
interest income after provision for losses on loans
|
5,545
|
5,677
|
2,793
|
2,786
|
||||||||||||
Other
income
|
||||||||||||||||
Increase
in cash surrender value of life insurance
|
116
|
110
|
58
|
55
|
||||||||||||
Trust
income
|
96
|
53
|
40
|
26
|
||||||||||||
Gain
on disposal of real estate acquired through foreclosure
|
31
|
-
|
31
|
-
|
||||||||||||
Service
fees, charges and other operating
|
674
|
694
|
340
|
350
|
||||||||||||
Total
other income
|
917
|
857
|
469
|
431
|
||||||||||||
General,
administrative and other expense
|
||||||||||||||||
Employee
compensation and benefits
|
2,783
|
2,847
|
1,400
|
1,449
|
||||||||||||
Occupancy
and equipment
|
983
|
935
|
497
|
477
|
||||||||||||
Federal
deposit insurance premiums
|
19
|
20
|
9
|
10
|
||||||||||||
Franchise
taxes
|
194
|
198
|
98
|
80
|
||||||||||||
Amortization
of intangible assets
|
53
|
53
|
26
|
27
|
||||||||||||
Other
operating
|
992
|
972
|
500
|
495
|
||||||||||||
Total
general, administrative and other expense
|
5,024
|
5,025
|
2,530
|
2,538
|
||||||||||||
Income
before income taxes
|
1,438
|
1,509
|
732
|
679
|
||||||||||||
Federal
incomes taxes
|
||||||||||||||||
Current
|
459
|
298
|
229
|
90
|
||||||||||||
Deferred
|
(91 | ) |
134
|
(44 | ) |
105
|
||||||||||
Total
federal income taxes
|
368
|
432
|
185
|
195
|
||||||||||||
NET
INCOME
|
$ |
1,070
|
$ |
1,077
|
$ |
547
|
$ |
484
|
||||||||
EARNINGS
PER SHARE
|
||||||||||||||||
Basic
|
$ |
0.35
|
$ |
0.33
|
$ |
0.18
|
$ |
0.15
|
||||||||
Diluted
|
$ |
0.35
|
$ |
0.33
|
$ |
0.18
|
$ |
0.15
|
||||||||
DIVIDENDS
PER SHARE
|
$ |
0.24
|
$ |
0.24
|
$ |
0.12
|
$ |
0.12
|
Six
months
|
Three
months
|
|||||||||||||||
ended
|
ended
|
|||||||||||||||
September
30,
|
September
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Net
income
|
$ |
1,070
|
$ |
1,077
|
$ |
547
|
$ |
484
|
||||||||
Other
comprehensive income:
|
||||||||||||||||
Unrealized
holding gains (losses) on securities, net of
related
|
||||||||||||||||
taxes
(benefits) of $(16), $225, $416 and $485 during the
|
||||||||||||||||
respective
periods
|
(32 | ) |
436
|
807
|
941
|
|||||||||||
Comprehensive
income
|
$ |
1,038
|
$ |
1,513
|
$ |
1,354
|
$ |
1,425
|
||||||||
Accumulated
comprehensive loss
|
$ | (508 | ) | $ | (575 | ) | $ | (508 | ) | $ | (575 | ) |
2007
|
2006
|
|||||||
(Unaudited)
|
||||||||
Cash
flows from operating activities:
|
||||||||
Net
income for the period
|
$ |
1,070
|
$ |
1,077
|
||||
Adjustments
to reconcile net income to net cash provided by
|
||||||||
operating
activities:
|
||||||||
Amortization
of discounts and premiums on loans,
|
||||||||
investments
and mortgage-backed securities – net
|
(33 | ) | (52 | ) | ||||
Amortization
of deferred loan origination fees
|
(26 | ) | (30 | ) | ||||
Depreciation
and amortization
|
321
|
348
|
||||||
Amortization
of expense related to ESOP
|
-
|
40
|
||||||
Provision
for losses on loans
|
55
|
60
|
||||||
Federal
Home Loan Bank stock dividends
|
-
|
(135 | ) | |||||
Increase
in cash surrender value of life insurance
|
(116 | ) | (111 | ) | ||||
Increase
(decrease) in cash due to changes in:
|
||||||||
Accrued
interest receivable on loans
|
48
|
(85 | ) | |||||
Accrued
interest receivable on mortgage-backed securities
|
(24 | ) | (60 | ) | ||||
Accrued
interest receivable on investments and interest-bearing
deposits
|
127
|
(66 | ) | |||||
Prepaid
expenses and other assets
|
19
|
(68 | ) | |||||
Amortization
of intangible assets
|
53
|
53
|
||||||
Accrued
interest payable
|
88
|
75
|
||||||
Accounts
payable on mortgage loans serviced for others
|
(19 | ) | (4 | ) | ||||
Other
liabilities
|
(46 | ) |
482
|
|||||
Federal
income taxes
|
||||||||
Current
|
33
|
(331 | ) | |||||
Deferred
|
(91 | ) |
134
|
|||||
Net
cash provided by operating activities
|
1,459
|
1,327
|
||||||
Cash
flows from investing activities:
|
||||||||
Purchase
of investment securities designated as available for sale
|
(6,569 | ) | (1,101 | ) | ||||
Proceeds
from maturity of investment securities designated as held to
maturity
|
53
|
2,681
|
||||||
Proceeds
from sale of investment securities designated as held to
maturity
|
-
|
2,512
|
||||||
Proceeds
from maturity of investment securities designated as available for
sale
|
16,616
|
6,430
|
||||||
Purchase
of mortgage-backed securities designated as available for
sale
|
(16,451 | ) | (15,584 | ) | ||||
Principal
repayments on mortgage-backed securities designated as held to
maturity
|
252
|
305
|
||||||
Principal
repayments and sales of mortgage-backed securities designated
as
|
||||||||
available
for sale
|
10,795
|
2,761
|
||||||
Loan
principal repayments
|
25,668
|
30,932
|
||||||
Loan
disbursements
|
(31,098 | ) | (31,949 | ) | ||||
Purchase
of office premises and equipment - net
|
(255 | ) | (179 | ) | ||||
Proceeds
from sale of real estate acquired through foreclosure
|
-
|
59
|
||||||
Net
cash used in investing activities
|
(989 | ) | (3,133 | ) | ||||
Net
cash provided by (used in) operating and investing
activities
|
||||||||
(balance
carried forward)
|
470
|
(1,806 | ) |
2007
|
2006
|
|||||||
(Unaudited)
|
||||||||
Net
cash provided by (used in) operating and investing
activities
|
||||||||
(balance
brought forward)
|
$ |
470
|
$ | (1,806 | ) | |||
Cash
flows from financing activities:
|
||||||||
Net
decrease in deposit accounts
|
(10,909 | ) | (5,094 | ) | ||||
Proceeds
from Federal Home Loan Bank advances
|
27,000
|
71,400
|
||||||
Repayments
of Federal Home Loan Bank advances
|
(22,500 | ) | (65,250 | ) | ||||
Advances
by borrowers for taxes and insurance
|
40
|
9
|
||||||
Dividends
paid on common stock
|
(760 | ) | (799 | ) | ||||
Proceeds
from exercise of stock options
|
-
|
279
|
||||||
Purchase
of treasury shares
|
(643 | ) | (836 | ) | ||||
Net
cash used in financing activities
|
(7,772 | ) | (291 | ) | ||||
Net
decrease in cash and cash equivalents
|
(7,302 | ) | (2,097 | ) | ||||
Cash
and cash equivalents at beginning of period
|
17,215
|
14,123
|
||||||
Cash
and cash equivalents at end of period
|
$ |
9,913
|
$ |
12,026
|
||||
Supplemental
disclosure of cash flow information:
|
||||||||
Cash
paid during the period for:
|
||||||||
Federal
income taxes
|
$ |
535
|
$ |
630
|
||||
Interest
on deposits and borrowings
|
$ |
5,804
|
$ |
5,202
|
||||
Supplemental
disclosure of noncash investing activities:
|
||||||||
Transfers
from loans to real estate acquired through foreclosure
|
$ |
113
|
$ |
-
|
||||
Unrealized
gains (losses) on securities designated as available for
sale,
|
||||||||
net
of related tax effects
|
$ | (32 | ) | $ |
436
|
|||
Dividends
payable
|
$ |
377
|
$ |
396
|
1.
|
Basis
of Presentation
|
|
In
the opinion of management, all adjustments (consisting only of normal
recurring accruals) which are necessary for a fair presentation of
the
unaudited financial statements have been included. The results
of operations for the six and three month periods ended September
30, 2007
are not necessarily indicative of the results which may be expected
for
the entire fiscal year.
|
|
Critical
Accounting Policy – The Company’s critical accounting policy relates
to the allowance for loan losses. The Company has established a
systematic method of periodically reviewing the credit quality of
the loan
portfolio in order to establish a sufficient allowance for loan
losses. The allowance for loan losses is based on management’s
current judgments about the credit quality of individual loans and
segments of the loan portfolio. The allowance for loan losses
is established through a provision, and considers all known internal
and
external factors that affect loan collectability as of the reporting
date. Such evaluation, which included a review of all loans on
which full collectability may not be reasonably assured, considers
among
other matters, the estimated net realizable value or the fair value
of the
underlying collateral, economic conditions, historical loan loss
experience, management’s knowledge of inherent risks in the portfolio that
are probable and reasonably estimable and other factors that warrant
recognition in providing an appropriate loan loss
allowance. Management has discussed the development and
selection of this critical accounting policy with the audit committee
of
the Board of Directors.
|
|
Use
of Estimates – The preparation of financial
statements in conformity with accounting principles generally accepted
in
the United States of America requires management to make estimates
and
assumptions that affect the reported amounts of assets and liabilities
and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from
those estimates.
|
2.
|
Principles
of Consolidation
|
|
The
accompanying consolidated financial statements include Wayne Savings
Bancshares, Inc. and the Company’s wholly-owned subsidiary, Wayne Savings
Community Bank (“Wayne Savings” or the
“Bank”).
|
|
Wayne
Savings has eleven banking locations in Wayne, Holmes, Ashland, Medina
and
Stark counties. All significant intercompany transactions and
balances have been eliminated in the
consolidation.
|
3.
|
Earnings
Per Share
|
|
Basic
earnings per common share is computed based upon the weighted-average
number of common shares outstanding during the period, less shares
in the
Company’s Employee Stock Ownership Plan (“ESOP”) that are unallocated and
not committed to be released. Diluted earnings per common share
include the dilutive effect of all additional potential common shares
issuable under the Company’s stock option plan. The
computations are as follows:
|
For
the six months ended
|
For
the three months ended
|
|||||||||||||||
September
30,
|
September
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Weighted-average
common shares
|
||||||||||||||||
outstanding
(basic)
|
3,078,585
|
3,230,084
|
3,071,966
|
3,225,249
|
||||||||||||
Dilutive
effect of assumed exercise
|
||||||||||||||||
of
stock options
|
82
|
12,135
|
-
|
11,333
|
||||||||||||
Weighted-average
common shares
|
||||||||||||||||
outstanding
(diluted)
|
3,078,667
|
3,242,219
|
3,071,966
|
3,236,582
|
Six
months ended
|
Year
ended
|
|||||||||||||||||||||||
September
30,
|
March
31,
|
|||||||||||||||||||||||
2007
|
2007
|
2006
|
||||||||||||||||||||||
Weighted-
|
Weighted-
|
Weighted-
|
||||||||||||||||||||||
average
|
average
|
average
|
||||||||||||||||||||||
exercise
|
exercise
|
exercise
|
||||||||||||||||||||||
Shares
|
price
|
Shares
|
price
|
Shares
|
price
|
|||||||||||||||||||
Outstanding
at beginning of period
|
114,224
|
$ |
13.95
|
179,148
|
$ |
13.92
|
214,204
|
$ |
13.84
|
|||||||||||||||
Granted
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||
Exercised
|
-
|
-
|
(60,924 | ) |
13.86
|
(27,556 | ) |
13.32
|
||||||||||||||||
Forfeited
|
-
|
-
|
(4,000 | ) |
13.95
|
(7,500 | ) |
13.95
|
||||||||||||||||
Outstanding
at end of period
|
114,224
|
$ |
13.95
|
114,224
|
$ |
13.95
|
179,148
|
$ |
13.92
|
|||||||||||||||
Options
exercisable at period-end
|
114,224
|
$ |
13.95
|
114,224
|
$ |
13.95
|
179,148
|
$ |
13.92
|
Number
outstanding
|
114,224
|
|
Exercise
price on all remaining options outstanding
|
$13.95
|
|
Weighted-average
remaining contractual life
|
6.5
years
|
|
·
|
Separately
recognize financial assets as servicing assets or servicing liabilities,
each time it undertakes an obligation to service a financial asset
by
entering into certain kinds of servicing
contracts;
|
|
·
|
Initially
measure all separately recognized servicing assets and liabilities
at fair
value, if practicable; and
|
|
·
|
Separately
present servicing assets and liabilities subsequently measured at
fair
value in the statement of financial condition and additional disclosures
for all separately recognized servicing assets and servicing
liabilities.
|
5.
|
Recent
Accounting Developments
(continued)
|
ITEM
2
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION
AND RESULTS OF OPERATIONS
|
For
the six months ended September 30,
|
||||||||||||||||||||||||
2007
|
2006
|
|||||||||||||||||||||||
Average
|
Average
|
Average
|
Average
|
|||||||||||||||||||||
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
|||||||||||||||||||
(Dollars
in thousands)
|
||||||||||||||||||||||||
Interest-earning
assets:
|
||||||||||||||||||||||||
Loans
receivable, net1
|
$ |
242,817
|
$ |
8,314
|
6.85 | % | $ |
236,034
|
$ |
7,876
|
6.67 | % | ||||||||||||
Mortgage-backed
|
||||||||||||||||||||||||
securities2
|
72,405
|
1,907
|
5.27
|
60,714
|
1,481
|
4.88
|
||||||||||||||||||
Investment
securities
|
47,009
|
1,005
|
4.28
|
69,376
|
1,455
|
4.19
|
||||||||||||||||||
Interest-bearing
deposits3
|
11,759
|
266
|
4.52
|
10,427
|
202
|
3.87
|
||||||||||||||||||
Total
interest-
|
||||||||||||||||||||||||
earning
assets
|
373,990
|
11,492
|
6.15
|
376,551
|
11,014
|
5.85
|
||||||||||||||||||
Non-interest-earning
assets
|
21,827
|
22,782
|
||||||||||||||||||||||
Total
assets
|
$ |
395,817
|
$ |
399,333
|
||||||||||||||||||||
Interest-bearing
liabilities:
|
||||||||||||||||||||||||
Deposits
|
$ |
324,064
|
5,069
|
3.13
|
$ |
332,611
|
4,649
|
2.80
|
||||||||||||||||
Borrowings
|
34,074
|
823
|
4.83
|
28,078
|
628
|
4.47
|
||||||||||||||||||
Total
interest-
|
||||||||||||||||||||||||
bearing
liabilities
|
358,138
|
5,892
|
3.29
|
360,689
|
5,277
|
2.93
|
||||||||||||||||||
Non-interest
bearing
|
||||||||||||||||||||||||
Liabilities
|
3,544
|
2,913
|
||||||||||||||||||||||
Total
liabilities
|
361,682
|
363,602
|
||||||||||||||||||||||
Stockholders’
equity
|
34,135
|
35,731
|
||||||||||||||||||||||
Total
liabilities and
|
||||||||||||||||||||||||
stockholders’
equity
|
$ |
395,817
|
$ |
399,333
|
||||||||||||||||||||
Net
interest income
|
$ |
5,600
|
$ |
5,737
|
||||||||||||||||||||
Interest
rate spread4
|
2.86 | % | 2.92 | % | ||||||||||||||||||||
Net
yield on interest-
|
||||||||||||||||||||||||
earning
assets5
|
2.99 | % | 3.05 | % | ||||||||||||||||||||
Ratio
of average interest-
|
||||||||||||||||||||||||
earning
assets to average
|
||||||||||||||||||||||||
interest-bearing
liabilities
|
104.43 | % | 104.40 | % |
1
|
Includes
non-accrual loan balances.
|
2
|
Includes
mortgage-backed securities designated as available for
sale.
|
3
|
Includes
federal funds sold and interest-bearing deposits in other financial
institutions.
|
4
|
Interest
rate spread represents the difference between the average yield on
interest-earning assets and the average cost of interest-bearing
liabilities.
|
5
|
Net
yield on interest-earning assets represents net interest income as
a
percentage of average interest-earning
assets.
|
For
the three months ended September 30,
|
||||||||||||||||||||||||
2007
|
2006
|
|||||||||||||||||||||||
Average
|
Average
|
Average
|
Average
|
|||||||||||||||||||||
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
|||||||||||||||||||
(Dollars
in thousands)
|
||||||||||||||||||||||||
Interest-earning
assets:
|
||||||||||||||||||||||||
Loans
receivable, net1
|
$ |
245,545
|
$ |
4,224
|
6.88 | % | $ |
236,649
|
$ |
3,985
|
6.74 | % | ||||||||||||
Mortgage-backed
|
||||||||||||||||||||||||
securities2
|
73,258
|
985
|
5.38
|
62,906
|
782
|
4.97
|
||||||||||||||||||
Investment
securities
|
44,034
|
473
|
4.30
|
67,751
|
712
|
4.20
|
||||||||||||||||||
Interest-bearing
deposits3
|
10,090
|
111
|
4.40
|
10,186
|
99
|
3.88
|
||||||||||||||||||
Total
interest-
|
||||||||||||||||||||||||
earning
assets
|
372,927
|
5,793
|
6.21
|
377,492
|
5,578
|
5.91
|
||||||||||||||||||
Non-interest-earning
assets
|
21,727
|
22,706
|
||||||||||||||||||||||
Total
assets
|
$ |
394,654
|
$ |
400,198
|
||||||||||||||||||||
Interest-bearing
liabilities:
|
||||||||||||||||||||||||
Deposits
|
$ |
321,686
|
2,538
|
3.16
|
$ |
331,448
|
2,417
|
2.92
|
||||||||||||||||
Borrowings
|
35,914
|
437
|
4.87
|
30,158
|
345
|
4.58
|
||||||||||||||||||
Total
interest-
|
||||||||||||||||||||||||
bearing
liabilities
|
357,600
|
2,975
|
3.33
|
361,606
|
2,762
|
3.06
|
||||||||||||||||||
Non-interest
bearing
|
||||||||||||||||||||||||
liabilities
|
3,065
|
2,767
|
||||||||||||||||||||||
Total
liabilities
|
360,665
|
364,373
|
||||||||||||||||||||||
Stockholders’
equity
|
33,989
|
35,825
|
||||||||||||||||||||||
Total
liabilities and
|
||||||||||||||||||||||||
stockholders’
equity
|
$ |
394,654
|
$ |
400,198
|
||||||||||||||||||||
Net
interest income
|
$ |
2,818
|
$ |
2,816
|
||||||||||||||||||||
Interest
rate spread4
|
2.88 | % | 2.85 | % | ||||||||||||||||||||
Net
yield on interest-
|
||||||||||||||||||||||||
earning
assets5
|
3.02 | % | 2.98 | % | ||||||||||||||||||||
Ratio
of average interest-
|
||||||||||||||||||||||||
earning
assets to average
|
||||||||||||||||||||||||
interest-bearing
liabilities
|
104.29 | % | 104.40 | % |
1
|
Includes
non-accrual loan balances.
|
2
|
Includes
mortgage-backed securities designated as available for
sale.
|
3
|
Includes
federal funds sold and interest-bearing deposits in other financial
institutions.
|
4
|
Interest
rate spread represents the difference between the average yield on
interest-earning assets and the average cost of interest-bearing
liabilities.
|
5
|
Net
yield on interest-earning assets represents net interest income as
a
percentage of average interest-earning
assets.
|
September
30, 2007
|
March
31, 2007
|
|||||||||||||||
(Dollars
in thousands)
|
||||||||||||||||
Mortgage
loans:
|
||||||||||||||||
One-
to four-family residential1
|
$ |
142,294
|
56.64 | % | $ |
144,311
|
57.88 | % | ||||||||
Residential
construction loans
|
2,257
|
.90
|
2,019
|
.81
|
||||||||||||
Multi-family
residential
|
9,060
|
3.61
|
8,938
|
3.58
|
||||||||||||
Non-residential
real estate/land2
|
65,476
|
26.06
|
61,873
|
24.82
|
||||||||||||
Total
mortgage loans
|
219,087
|
87.21
|
217,141
|
87.09
|
||||||||||||
Other
loans:
|
||||||||||||||||
Consumer
loans3
|
6,159
|
2.45
|
5,460
|
2.19
|
||||||||||||
Commercial
business loans
|
25,991
|
10.34
|
26,730
|
10.72
|
||||||||||||
Total
other loans
|
32,150
|
12.79
|
32,190
|
12.91
|
||||||||||||
Total
loans before net items
|
251,237
|
100.00 | % |
249,331
|
100.00 | % | ||||||||||
Less:
|
||||||||||||||||
Loans
in process
|
3,766
|
7,334
|
||||||||||||||
Deferred
loan origination fees
|
423
|
425
|
||||||||||||||
Allowance
for loan losses
|
1,605
|
1,523
|
||||||||||||||
Total
loans receivable, net
|
$ |
245,443
|
$ |
240,049
|
||||||||||||
Mortgage-backed
securities, net4
|
$ |
74,368
|
$ |
69,065
|
1
|
Includes
equity loans collateralized by second mortgages in the aggregate
amount of
$17.9 million and $19.2 million as of September 30, 2007 and March
31,
2007, respectively. Such loans have been underwritten on
substantially the same basis as the Company’s first mortgage
loans.
|
2
|
Includes
land loans of $205,000 and $204,000 as of September 30, 2007 and
March 31,
2007, respectively.
|
3
|
Includes
second mortgage loans of $348,000 and $425,000 as of September 30,
2007
and March 31, 2007, respectively.
|
4
|
Includes
the carrying values of mortgage-backed securities both designated
as
available for sale and held to
maturity.
|
September
30,
|
March
31,
|
|||||||
2007
|
2007
|
|||||||
(Dollars
in thousands)
|
||||||||
Past
due loans 30-89 days:
|
||||||||
Mortgage
loans:
|
||||||||
One-
to four-family residential
|
$ |
915
|
$ |
270
|
||||
Nonresidential
|
-
|
-
|
||||||
Land
|
-
|
-
|
||||||
Non-mortgage
loans:
|
||||||||
Commercial
business loans
|
264
|
-
|
||||||
Consumer
loans
|
3
|
11
|
||||||
$ |
1,182
|
$ |
281
|
|||||
Non-performing
loans:
|
||||||||
Mortgage
loans:
|
||||||||
One-
to four-family residential1
|
$ |
840
|
$ |
683
|
||||
All
other mortgage loans
|
-
|
-
|
||||||
Non-mortgage
loans:
|
||||||||
Commercial
business loans
|
-
|
267
|
||||||
Consumer
|
-
|
-
|
||||||
Total
non-performing loans
|
840
|
950
|
||||||
Total
real estate acquired through foreclosure
|
7
|
-
|
||||||
Total
non-performing assets
|
$ |
847
|
$ |
950
|
||||
Total
non-performing loans to net
|
||||||||
loans
receivable
|
0.34 | % | 0.40 | % | ||||
Total
non-performing loans to total assets
|
0.21 | % | 0.23 | % | ||||
Total
non-performing assets to total assets
|
0.21 | % | 0.23 | % |
For the six months ended |
For
the year ended
|
|||||||
September 30, 2007 |
March
31, 2007
|
|||||||
(Dollars
in thousands)
|
||||||||
Loans
receivable, net
|
$ |
245,443
|
$ |
240,049
|
||||
Average
loans receivable, net
|
$ |
242,817
|
$ |
237,429
|
||||
Allowance
balance (at beginning of period)
|
$ |
1,523
|
$ |
1,484
|
||||
Charge-offs:
|
||||||||
Mortgage
loans:
|
||||||||
One-
to four-family
|
-
|
(31 | ) | |||||
Residential
construction
|
-
|
-
|
||||||
Multi-family
residential
|
-
|
-
|
||||||
Non-residential
real estate and land
|
-
|
(31 | ) | |||||
Other
loans:
|
||||||||
Consumer
|
-
|
(21 | ) | |||||
Commercial
|
-
|
-
|
||||||
Gross
charge-offs
|
-
|
(83 | ) | |||||
Recoveries:
|
||||||||
Mortgage
loans:
|
||||||||
One-
to four-family
|
13
|
1
|
||||||
Residential
construction
|
-
|
-
|
||||||
Multi-family
residential
|
-
|
-
|
||||||
Non-residential
real estate and land
|
-
|
-
|
||||||
Other
loans:
|
||||||||
Consumer
|
14
|
21
|
||||||
Commercial
|
-
|
-
|
||||||
Gross
recoveries
|
27
|
22
|
||||||
Net
(charge-offs) recoveries
|
27
|
(61 | ) | |||||
Provision
charged to operations
|
55
|
100
|
||||||
Allowance
for loans losses balance (at end
|
||||||||
of
period)
|
$ |
1,605
|
$ |
1,523
|
||||
Allowance
for loan losses as a percent of loans
|
||||||||
receivable,
net at end of period
|
0.65 | % | 0.63 | % | ||||
Net
loans charged off as a percent of average
|
||||||||
loans
receivable, net
|
0.00 | % | 0.03 | % | ||||
Ratio
of allowance for loan losses to non-
|
||||||||
performing
loans at end of period
|
191.07 | % | 160.32 | % |
ITEM
3
|
QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
|
ITEM
4
|
CONTROLS
AND
PROCEDURES
|
|
(a)
|
Evaluation
of disclosure controls and
procedures.
|
|
(b)
|
Changes
in internal controls.
|
ITEM
1.
|
Legal
Proceedings
|
ITEM
1A.
|
Risk
Factors
|
ITEM
2.
|
Unregistered
Sales of Equity Securities and Use of
Proceeds
|
|
(c)
|
The
following table sets forth certain information regarding repurchases
by
the Company for the quarter ended September 30,
2007.
|
Total
# of
|
Maximum
# of shares
|
|||||||||||||||
Total
|
Average
|
shares
purchased
|
which
may still be
|
|||||||||||||
#
of shares
|
price
paid
|
as
part of the
|
purchased
as part
|
|||||||||||||
Period
|
purchased
|
per
share
|
announced
plan
|
of
the announced plan
|
||||||||||||
July
1-31, 2007
|
-
|
$
|
-
|
-
|
112,967
|
|||||||||||
August 1-31,
2007
|
21,287
|
$
|
12.50
|
70,485
|
91,680
|
|||||||||||
September
1-30, 2007
|
29,500
|
$
|
12.76
|
99,985
|
62,180
|
|||||||||||
ITEM
3.
|
Defaults
Upon Senior
Securities
|
ITEM
4.
|
Submission
of Matters to a Vote of Security
Holders
|
Russell
L. Harpster
|
For:
|
2,412,598
|
Withheld:
|
108,240
|
||
Terry
A. Gardner
|
For:
|
2,447,575
|
Withheld:
|
73,264
|
||
Frederick
J. Krum
|
For:
|
2,423,178
|
Withheld:
|
97,661
|
For: 2,473,738
|
Against:
13,229
|
Abstain:
29,337
|
ITEM
5.
|
Other
Information
|
ITEM
6.
|
Exhibits
|
|
Certification
of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002, 18 U.S.C. Section 1350
|
|
Certification
of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002, 18 U.S.C. Section 1350
|
|
Written
Statement of Chief Executive Officer and Chief Financial Officer
furnished
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C.
Section 1350
|
Date:
|
November
13, 2007
|
By:
|
/s/Phillip
E. Becker
|
|
Phillip
E. Becker
|
||||
President
and Chief Executive Officer
|
||||
Date:
|
November
13, 2007
|
By:
|
/s/H.
Stewart Fitz Gibbon III
|
|
H.
Stewart Fitz Gibbon III
|
||||
Executive
Vice President and
|
||||
Chief
Financial Officer
|