Home Bancorp Announces 2013 Second Quarter Results

LAFAYETTE, La., July 23, 2013 /PRNewswire/ -- Home Bancorp, Inc. (Nasdaq:  "HBCP") (the "Company"), the parent company for Home Bank (www.home24bank.com), a Federally chartered savings bank headquartered in Lafayette, Louisiana (the "Bank"), announced net income of $1.2 million for the second quarter of 2013, a decrease of $618,000, or 33%, compared to the first quarter of 2013 and a decrease of $509,000, or 29%, compared to the second quarter of 2012.  Diluted earnings per share were $0.18 for the second quarter of 2013, a decrease of $0.08, or 31%, compared to the first quarter of 2013 and a decrease of $0.06, or 25%, compared to the second quarter of 2012. 

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"Second quarter performance was significantly impacted by the write down of one problem loan relationship in our Baton Rouge market," stated John W. Bordelon, President and Chief Executive Officer of the Company and the Bank. "We remain committed to early identification of problem loans and are working aggressively to resolve nonperforming assets as quickly as the legal process allows."

"While we had a relatively strong quarter of loan production," added Mr. Bordelon, "the effect was muted by anticipated reductions in our Covered Loan portfolio."

Loans and Credit Quality

Loans totaled $675.9 million at June 30, 2013, a decrease of $2.7 million, or 0.4%, from March 31, 2013, and a decrease of $3.9 million, or 0.6%, from June 30, 2012.  During the second quarter, decreases in residential mortgage loans (down $5.0 million), multi-family loans (down $1.6 million) and construction and land loans (down $3.0 million) were largely offset by increases in commercial and industrial loans (up $7.0 million).  Loans covered under loss sharing agreements with the FDIC ("Covered Loans") totaled $27.4 million as of June 30, 2013, a decrease of $14.2 million, or 34.1%, compared to March 31, 2013.  The decrease in Covered Loans was primarily the result of principal repayments.   

The following table sets forth the composition of the Company's loan portfolio (including Covered Loans) as of the dates indicated. 










June 30,


December 31,


Increase/(Decrease)


(dollars in thousands)


2013


2012


Amount

Percent


Real estate loans:









     One- to four-family first mortgage

$

181,243

$

177,816

$

3,427

2

%

     Home equity loans and lines


37,950


40,425


(2,475)

(6)


     Commercial real estate


250,786


252,805


(2,019)

(1)


     Construction and land


71,269


75,529


(4,260)

(6)


     Multi-family residential


16,875


19,659


(2,784)

(14)


        Total real estate loans


558,123


566,234


(8,111)

(1)


Other loans:









     Commercial and industrial


81,377


72,253


9,124

13


     Consumer


36,419


34,641


1,778

5


        Total other loans


117,796


106,894


10,902

10


        Total loans

$

675,919

$

673,128

$

2,791

0

%

Nonperforming assets ("NPAs"), which include $9.7 million in assets covered under loss sharing agreements with the FDIC ("Covered Assets") and $12.2 million in assets acquired from GS Financial Corp. ("GSFC"), totaled $27.5 million at June 30, 2013, a decrease of $2.9 million compared to March 31, 2013 and a decrease of $2.8 million compared to June 30, 2012.  The ratio of total NPAs to total assets was 2.83% at June 30, 2013, compared to 3.12% at March 31, 2013 and 3.06% at June 30, 2012.  Excluding acquired assets, the ratio of NPAs to total assets was 0.68% at June 30, 2013, compared to 0.80% at March 31, 2013 and 0.90% at June 30, 2012. 

The Company recorded net loan charge-offs of $1.8 million during the second quarter of 2013, compared to net loan charge-offs of $165,000 in the first quarter of 2013 and $1.7 million in the second quarter of 2012.  The increase in net charge-offs for the second quarter of 2013 resulted primarily from a $1.7 million charge-off on a $1.9 million accounts receivable line of credit which was downgraded and placed on nonaccrual status during the quarter.

The Company's provision for loan losses for the second quarter of 2013 was $2.2 million, compared to $520,000 for the first quarter of 2013 and $1.2 million for the second quarter of 2012.  The elevated level of provision during the second quarter of 2013 relates primarily to the accounts receivable line of credit mentioned above. 

The ratio of allowance for loan losses to total loans was 0.90% at June 30, 2013 compared to 0.84% and 0.78% at March 31, 2013 and June 30, 2012, respectively.  Excluding acquired loans, the ratio of the allowance for loan losses to total loans was 1.08% at June 30, 2013 compared to 1.05% at March 31, 2013 and June 30, 2012.           

Investment Securities Portfolio

The Company's investment securities portfolio totaled $155.9 million at June 30, 2013, a decrease of $3.8 million, or 2%, from March 31, 2013, and an increase of $752,000, or 1%, from June 30, 2012.  At June 30, 2013, the Company had a net unrealized gain position on its investment securities portfolio of $1.4 million, compared to net unrealized gains of $4.6 million and $4.1 million at March 31, 2013 and June 30, 2012, respectively. The decrease in the unrealized gain primarily reflects the increasing market interest rates.  The investment securities portfolio had a modified duration of 4.2 years at June 30, 2013, compared to 3.7 and 3.6 years at March 31, 2013 and June 30, 2012, respectively.

During the second quarter of 2013, the Company sold five securities with an aggregate book value of $7.3 million and realized an aggregate gain of $428,000 on the transactions.   

Deposits

During the second quarter of 2013, core deposits (i.e., checking, savings and money market accounts) increased $12.5 million, or 2%, from March 31, 2013, and increased $50.7 million, or 10%, from June 30, 2012.  Total deposits were $777.2 million at June 30, 2013, a decrease of $4.1 million, or 1%, from March 31, 2013, and a decrease of $2.0 million, or 0.3%, from June 30, 2012.

The following table sets forth the composition of the Company's deposits at the dates indicated.










June 30,


December 31,


Increase / (Decrease)


(dollars in thousands)


2013


2012


Amount

Percent


Demand deposit

$

180,376

$

152,462

$

27,914

18

%

Savings


54,395


51,515


2,880

6


Money market


193,725


191,191


2,534

1


NOW


125,344


123,294


2,050

2


Certificates of deposit


223,396


252,967


(29,571)

(12)


        Total deposits

$

777,236

$

771,429

$

5,807

1

%










Share Repurchases

The Company completed its July 2012 share repurchase program at the beginning of June 2013.  Under the July 2012 program, the Company acquired 383,598 shares of the Company's common stock at an average price of $17.68 per share. 

On June 7, 2013, the Company announced the commencement of a new share repurchase program (the "June 2013 program").  Under the June 2013 program, the Company may purchase up to 370,000 shares, or approximately 5%, of the Company's outstanding common stock.  Under the June 2013 program, the Company purchased 157,700 shares of its common stock during the second quarter of 2013 at an average price per share of $17.88.  As of July 17, 2013, the Company has purchased 176,300 shares under the June 2013 plan at an average price per share of $17.95; hence, an additional 193,700 shares remain eligible for purchase under the plan.  The tangible book value per share of the Company's common stock was $19.06 at June 30, 2013.     

Net Interest Income

Net interest income for the second quarter of 2013 totaled $9.9 million, an increase of $79,000, or 1%, compared to the first quarter of 2013, and a decrease of $38,000, or 0.4%, compared to the second quarter of 2012.  The modest increase in net interest income in the second quarter of 2013 compared to the first quarter of 2013 was due largely to lower average yields paid on interest-bearing liabilities.  The decline in net interest income in the second quarter of 2013 compared to the second quarter of 2012 was due largely to lower loan interest income as a result of lower average yields earned on loans, reflecting the continuing low interest rate environment as well as the effects of competition for loans in our marketplace.    

The Company's net interest margin was 4.59% for the second quarter of 2013, four basis points lower than the first quarter of 2013 and seven basis points lower than the second quarter of 2012.  The decrease in the net interest margin related primarily to lower loan yields.    

The following table sets forth the Company's average volume and rate of its interest-earning assets and interest-bearing liabilities for the periods indicated.  Taxable equivalent ("TE") yields on investment securities are calculated using a marginal tax rate of 35%.



For the Three Months Ended



June 30, 2013



March 31, 2013



June 30, 2012


(dollars in thousands)


Average Balance

Average Yield/Rate



Average Balance

Average Yield/Rate



Average Balance

Average Yield/Rate


Interest-earning assets:













Loans receivable

$

683,394

5.86

%

$

675,435

5.98

%

$

674,244

6.12

%

Investment securities (TE)


154,523

2.11



153,958

2.15



152,916

2.24


Other interest-earning assets


28,153

0.46



28,753

0.44



26,504

0.53


    Total interest-earning assets

$

866,070

5.01


$

858,146

5.11


$

853,664

5.25















Interest-bearing liabilities:













Deposits:













Savings, checking, and money market

$

372,613

0.26


$

369,594

0.30


$

329,371

0.39


Certificates of deposit


231,824

0.97



245,421

1.01



276,800

1.11


    Total interest-bearing deposits


604,437

0.53



615,015

0.58



606,171

0.72


FHLB advances


50,734

0.96



41,243

1.39



73,488

0.97


    Total interest-bearing liabilities

$

655,171

0.56


$

656,258

0.63


$

679,659

0.75















Net interest spread (TE)



4.45

%



4.48

%



4.50

%

Net interest margin (TE)



4.59

%



4.63

%



4.66

%

Noninterest Income

Noninterest income for the second quarter of 2013 totaled $2.2 million, an increase of $416,000, or 23%, compared to the first quarter of 2013 and an increase of $297,000, or 16%, compared to the second quarter of 2012.  The increase in noninterest income in the second quarter of 2013 compared to the first quarter of 2013 resulted primarily from increases in gains on the sale of securities (up $428,000), bank card fees (up $40,000) and service fees and charges (up $33,000), which were partially offset by a decrease in gains on the sale of mortgage loans (down $122,000).     

The increase in noninterest income in the second quarter of 2013 compared to the second quarter of 2012 resulted primarily from higher gains on the sale of securities (up $369,000), which was partially offset by decreases in discount accretion on the FDIC loss sharing receivable (down $64,000), bank card fees (down $30,000) and income from bank-owned life insurance (down $13,000).      

Noninterest Expense

Noninterest expense for the second quarter of 2013 totaled $8.0 million, a decrease of $282,000, or 3%, compared to the first quarter of 2013 and a decrease of $29,000, or 0.4%, compared to the second quarter of 2012.  The decrease in noninterest expense in the second quarter of 2013 compared to the first quarter of 2013 resulted primarily from lower foreclosed asset expenses (down $210,000 primarily due to a gain of $194,000 recorded on a disposed asset), compensation and benefits expenses (down $216,000) and marketing and advertising expenses (down $67,000), which were partially offset by higher other expenses (up $169,000 primarily due to penalties incurred in prepaying long-term FHLB borrowings), occupancy expenses (up $51,000) and forms, printing and supplies expenses (up $29,000).  

The decrease in noninterest expense in the second quarter of 2013 compared to the second quarter of 2012 resulted primarily from lower foreclosed asset expenses (down $275,000), which was partially offset by higher other expenses (up $151,000) and Louisiana shares taxes (up $97,000). 

This news release contains financial information determined by methods other than in accordance with generally accepted accounting principles ("GAAP"). The Company's management uses this non-GAAP financial information in its analysis of the Company's performance. In this news release, information is included which excludes loans acquired from the FDIC and GSFC. Management believes the presentation of this non-GAAP financial information provides useful information that is essential to a proper understanding of the Company's financial position and core operating results. This non-GAAP financial information should not be viewed as a substitute for financial information determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP financial information presented by other companies. 

This news release contains certain forward‑looking statements. Forward‑looking statements can be identified by the fact that they do not relate strictly to historical or current facts.  They often include the words "believe," "expect," "anticipate," "intend," "plan," "estimate" or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could" or "may."

Forward‑looking statements, by their nature, are subject to risks and uncertainties.  A number of factors ‑ many of which are beyond our control ‑ could cause actual conditions, events or results to differ significantly from those described in the forward‑looking statements.  Home Bancorp's Annual Report on Form 10-K for the year ended December 31, 2012, describes some of these factors, including risk elements in the loan portfolio, the level of the allowance for losses on loans, risks of our growth strategy, geographic concentration of our business, dependence on our management team, risks of market rates of interest and of regulation on our business and risks of competition. Forward‑looking statements speak only as of the date they are made.  We do not undertake to update forward‑looking statements to reflect circumstances or events that occur after the date the forward‑looking statements are made or to reflect the occurrence of unanticipated events.

 

HOME BANCORP, INC. AND SUBSIDIARY

CONDENSED STATEMENTS OF FINANCIAL CONDITION
























June 30,


June 30,


%



March 31,


December 31,


2013


2012


Change



2013


2012

Assets











Cash and cash equivalents

$   51,957,884


$   51,694,432


1

%


$   48,271,579


$   39,539,366

Interest-bearing deposits in banks

3,284,000


4,509,000


(27)



3,529,000


3,529,000

Investment securities available for sale, at fair value

150,387,103


152,718,411


(2)



158,264,273


157,255,828

Investment securities held to maturity

5,505,716


2,422,574


127



1,463,543


1,665,184

Mortgage loans held for sale

4,229,298


4,832,498


(12)



4,373,926


5,627,104

Loans covered by loss sharing agreements

27,350,973


46,827,556


(42)



41,533,637


45,764,397

Noncovered loans, net of unearned income

648,568,074


632,944,049


2



637,044,534


627,363,937

     Total loans

675,919,047


679,771,605


(1)



678,578,171


673,128,334

Allowance for loan losses

(6,093,556)


(5,314,386)


15



(5,674,179)


(5,319,235)

     Total loans, net of allowance for loan losses

669,825,491


674,457,219


(1)



672,903,992


667,809,099

FDIC loss sharing receivable

15,065,655


22,827,051


(34)



15,658,092


15,545,893

Office properties and equipment, net

30,473,517


30,618,073


-



30,540,350


30,777,184

Cash surrender value of bank-owned life insurance

17,523,536


17,033,380


3



17,405,985


17,286,434

Accrued interest receivable and other assets

23,511,646


27,402,864


(14)



24,614,631


23,891,172

Total Assets

$ 971,763,846


$ 988,515,502


(2)



$ 977,025,371


$ 962,926,264























Liabilities











Deposits

$ 777,236,290


$ 779,233,938


-

%


$ 781,335,468


$ 771,429,335

Federal Home Loan Bank advances

52,500,000


54,874,645


(4)



49,346,176


46,256,805

Accrued interest payable and other liabilities

3,868,422


15,375,621


(75)



3,225,771


3,666,264

Total Liabilities

833,604,712


849,484,204


(2)



833,907,415


821,352,404












Shareholders' Equity











Common stock

89,563


89,453


-

%


89,534


89,506

Additional paid-in capital

91,309,237


90,069,141


1



91,458,193


90,986,820

Treasury stock

(27,187,845)


(17,208,855)


58



(22,390,786)


(21,719,954)

Common stock acquired by benefit plans

(6,487,467)


(7,666,096)


(15)



(7,358,139)


(7,455,669)

Retained earnings 

79,540,747


71,058,483


12



78,297,156


76,435,222

Accumulated other comprehensive income 

894,899


2,689,172


(67)



3,021,998


3,237,935

Total Shareholders' Equity

138,159,134


139,031,298


(1)



143,117,956


141,573,860

Total Liabilities and Shareholders' Equity

$ 971,763,846


$ 988,515,502


(2)



$ 977,025,371


$ 962,926,264

 

 

HOME BANCORP, INC. AND SUBSIDIARY

CONDENSED STATEMENTS OF INCOME


























 For The Three Months Ended 





 For The Six Months Ended 





 June 30, 

%



 June 30, 

%



2013

2012


Change



2013

2012


Change


Interest Income












Loans, including fees

$   10,067,629

$   10,383,044


(3)

%


$   20,140,379

$   20,754,401


(3)

%

Investment securities

752,159

812,148


(7)



1,523,210

1,671,631


(9)


Other investments and deposits

32,299

35,068


(8)



63,606

69,466


(8)


    Total interest income

10,852,087

11,230,260


(3)



21,727,195

22,495,498


(3)














Interest Expense












Deposits

799,667

1,084,579


(26)

%


1,680,680

2,216,427


(24)

%

Federal Home Loan Bank advances

122,517

177,766


(31)



266,196

358,602


(26)


    Total interest expense

922,184

1,262,345


(27)



1,946,876

2,575,029


(24)


Net interest income

9,929,903

9,967,915


-



19,780,319

19,920,469


(1)


Provision for loan losses

2,247,802

1,160,326


94



2,768,193

1,872,226


48


Net interest income after provision for loan losses

7,682,101

8,807,589


(13)



17,012,126

18,048,243


(6)














Noninterest Income












Service fees and charges

579,594

583,916


(1)

%


1,125,941

1,153,858


(2)

%

Bank card fees

454,123

484,408


(6)



868,515

952,692


(9)


Gain on sale of loans, net

426,442

417,934


2



974,861

744,105


31


Income from bank-owned life insurance

117,551

130,927


(10)



237,102

262,206


(10)


Gain on the sale of securities, net

428,200

59,079


625



428,200

59,247


623


Discount accretion of FDIC loss sharing receivable

111,649

175,622


(36)



223,848

353,131


(37)


Other income

78,766

47,773


65



118,132

74,335


59


    Total noninterest income

2,196,325

1,899,659


16



3,976,599

3,599,574


10














Noninterest Expense












Compensation and benefits

4,880,129

4,826,649


1

%


9,976,347

9,522,358


5

%

Occupancy

759,939

702,003


8



1,468,725

1,396,945


5


Marketing and advertising

172,327

184,890


(7)



411,523

336,364


22


Data processing and communication

626,156

666,999


(6)



1,267,671

1,339,340


(5)


Professional fees

193,506

255,483


(24)



406,252

487,736


(17)


Forms, printing and supplies

136,023

140,449


(3)



242,796

266,715


(9)


Franchise and shares tax

272,960

175,651


55



546,580

351,302


56


Regulatory fees

219,635

213,018


3



442,884

411,175


8


Foreclosed assets, net

(32,185)

242,726


(113)



145,758

510,724


(71)


Other expenses

785,588

635,046


24



1,401,859

1,229,077


14


    Total noninterest expense

8,014,078

8,042,914


-



16,310,395

15,851,736


3


Income before income tax expense

1,864,348

2,664,334


(30)



4,678,330

5,796,081


(19)


Income tax expense

620,757

911,659


(32)



1,572,805

1,982,948


(21)


Net income

$     1,243,591

$     1,752,675


(29)



$     3,105,525

$     3,813,133


(19)














Earnings per share - basic

$              0.19

$              0.25


(24)

%


$              0.46

$              0.55


(16)

%

Earnings per share - diluted

$              0.18

$              0.24


(25)



$              0.44

$              0.53


(17)


 

 

HOME BANCORP, INC. AND SUBSIDIARY

SUMMARY FINANCIAL INFORMATION




























For The Three Months Ended





For The Three






June 30,


%



Months Ended



%



2013


2012


Change



March 31, 2013



Change


(dollars in thousands except per share data)













EARNINGS DATA













Total interest income

$   10,852


$   11,230


(3)

%


$             10,875



-

%

Total interest expense

922


1,262


(27)



1,025



(10)


Net interest income

9,930


9,968


-



9,850



1


Provision for loan losses

2,248


1,160


94



520



332


Total noninterest income

2,196


1,900


16



1,780



23


Total noninterest expense

8,014


8,043


-



8,296



(3)


Income tax expense

621


912


(32)



952



(35)


Net income

$     1,243


$     1,753


(29)



$              1,862



(33)















AVERAGE BALANCE SHEET DATA













Total assets

$ 967,683


$963,270


-

%


$           961,542



1

%

Total interest-earning assets

866,070


853,664


1



858,146



1


Total loans

683,394


674,244


1



675,435



1


Total interest-bearing deposits

604,437


606,171


-



615,015



(2)


Total interest-bearing liabilities

655,171


679,659


(4)



656,258



-


Total deposits

771,868


747,148


3



775,937



(1)


Total shareholders' equity

143,708


139,113


3



143,113



-















SELECTED RATIOS (1)













Return on average assets

0.51

%

0.73

%

(30)

%


0.77

%


(34)

%

Return on average equity

3.46


5.04


(31)



5.20



(33)


Efficiency ratio (2)

66.09


67.77


(2)



71.33



(7)


Average equity to average assets

14.85


14.44


3



14.88



-


Tier 1 leverage capital ratio(3) 

13.85


12.72


9



13.70



1


Total risk-based capital ratio(3) 

22.14


20.70


7



22.11



-


Net interest margin (4)

4.59


4.66


(2)



4.63



(1)















PER SHARE DATA













Basic earnings per share

$      0.19


$0.25


(24)

%


$                0.28



(32)

%

Diluted earnings per share

0.18


0.24


(25)



0.26



(31)


Book value at period end

19.35


18.07


7



19.33



-


Tangible book value at period end

19.06


17.76


7



19.03



-















PER SHARE DATA













Shares outstanding at period end

7,141,691


7,693,769


(7)

%


7,405,767



(4)

%

Weighted average shares outstanding













   Basic

6,652,097


6,972,170


(5)

%


6,748,752



(1)

%

   Diluted

6,963,570


7,234,806


(4)



7,099,544



(2)















(1) 

With the exception of end-of-period ratios, all ratios are based on average monthly balances during the respective periods.

(2) 

The efficiency ratio represents noninterest expense as a percentage of total revenues. Total revenues is the sum of net interest income and noninterest income.

(3) 

Capital ratios are end of period ratios for the Bank only.

(4) 

Net interest margin represents net interest income as a percentage of average interest-earning assets. Taxable equivalent yields are calculated using a marginal

tax rate of 35%.

 

HOME BANCORP, INC. AND SUBSIDIARY

SUMMARY CREDIT QUALITY INFORMATION












































June 30, 2013


March 31, 2013


June 30, 2012


Covered

Noncovered

Total


Covered

Noncovered

Total


Covered

Noncovered

Total

(dollars in thousands)





















CREDIT QUALITY(1)  (2)





















Nonaccrual loans

$  6,949


$ 16,938


$ 23,887



$  8,105


$ 15,225


$ 23,330



$9,585


$15,842


$ 25,427


Accruing loans past due 90 days and over

-


-


-



-


-


-



-


-


-


Total nonperforming loans

6,949


16,938


23,887



8,105


15,225


23,330



9,585


15,842


25,427


Other real estate owned

2,755


888


3,643



3,517


3,612


7,129



3,244


1,623


4,867


Total nonperforming assets

9,704


17,826


27,530



11,622


18,837


30,459



12,829


17,465


30,294


Performing troubled debt restructurings

321


532


853



297


482


779



20


831


851


Total nonperforming assets and troubled 





















debt restructurings

$ 10,025


$ 18,358


$ 28,383



$ 11,919


$ 19,319


$ 31,238



$ 12,849


$ 18,296


$ 31,145























Nonperforming assets to total assets





2.83

%






3.12

%






3.06

%

Nonperforming loans to total assets 





2.46







2.39







2.57


Nonperforming loans to total loans 





3.53







3.44







3.74


Allowance for loan losses to nonperforming assets





22.13







18.63







17.54


Allowance for loan losses to nonperforming loans





25.51







24.32







20.90


Allowance for loan losses to total loans





0.90







0.84







0.78























Year-to-date loan charge-offs





$  2,030







$     189







$  1,684


Year-to-date loan recoveries





37







24







22


Year-to-date net loan charge-offs





$  1,993







$     165







$  1,662


Annualized YTD net loan charge-offs to total loans





0.59

%






0.10

%






0.49

%
































































(1) 

Nonperforming loans consist of nonaccruing loans and accruing loans 90 days or more past due. Nonperforming assets consist of nonperforming loans and

repossessed assets. It is our policy to cease accruing interest on loans 90 days or more past due. Repossessed assets consist of assets acquired through

foreclosure or acceptance of title in-lieu of foreclosure.

(2) 

Asset quality information includes assets covered under FDIC loss sharing agreements. Such assets covered by FDIC loss sharing agreements are referred

to as "Covered" assets. All other assets are referred to as "Noncovered".

 

 

SOURCE Home Bancorp, Inc.



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