WELLS, Minn., Oct. 26, 2011 /PRNewswire/ --
Selected Financial Data (Dollars in Thousands, except per share data) (unaudited) |
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Quarter Ended September 30, |
Nine Months Ended September 30, |
||||
2011 |
2010 |
2011 |
2010 |
||
Net Income |
$ 427 |
$ 587 |
$ 1,099 |
$ 1,413 |
|
Basic earnings per share |
$ 0.54 |
$ 0.75 |
$ 1.40 |
$ 1.81 |
|
Diluted earnings per share |
$ 0.54 |
$ 0.75 |
$ 1.40 |
$ 1.80 |
|
Return on average equity (1) |
7.0% |
10.3% |
6.1% |
8.4% |
|
Return on average assets (1) |
0.7% |
1.0% |
0.6% |
0.7% |
|
Net interest rate spread |
3.9% |
3.9% |
3.9% |
3.6% |
|
Net interest rate margin |
4.0% |
3.9% |
4.0% |
3.7% |
|
Book value per share |
$ 31.21 |
$ 29.42 |
$ 31.21 |
$ 29.42 |
|
(1) Annualized |
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Lonnie R. Trasamar, President of Wells Financial Corp. (OTC BB: WEFP) (the Company), the holding company of Wells Federal Bank (the Bank), announced earnings for the third quarter of 2011 of $427,000, down $160,000 or 27.3%, when compared to the third quarter of 2010. Basic and diluted earnings per share for the third quarter of 2011 were $0.54, down $0.21, or 28.0% when compared to the same period in 2010.
Net income for the nine months ended September 30, 2011 was $1,099,000, down $314,000 or 22.2% when compared to the same period in 2010. Basic and diluted earnings per share were $1.40, down $0.41 and $0.40, or 22.7% and 22.1%, respectively, when compared to the same period in 2010.
When comparing the third quarter of 2011 with the third quarter of 2010, the decrease in net income resulted, primarily, from a $255,000 decrease in gain on sale of loans originated for sale and a $251,000 increase in the provision for loan losses. During the third quarter of 2011 fewer loans were originated for sale to the secondary market resulting in the decrease in gain on sale of loans. For more information regarding the increase in the provision for loan losses please see the allowance for loan loss discussion below.
When comparing the nine months ended September 30, 2011 with the same period in 2010 the decrease in net income was due, primarily, to an increase of $377,000 in the provision for loan loss. Please see the discussion below for information on the allowance and provision for loan loss.
In accordance with the Bank's internal classification of assets policy, management evaluates the loan portfolio on a quarterly basis to identify and determine the adequacy of the allowance for loan loss and adjusts the level of the allowance for loan loss through the provision for loan loss. The provision for loan losses increased by $251,000 for the third quarter of 2011 when compared to the same period in 2010 and increased by $377,000 for the nine months ended September 30, 2011 when compared to the same period in 2010. As of September 30, 2011 and December 31, 2010, the balance in the allowance for loan losses and the allowance for loan losses as a percentage of total loans were $2,405,000 and $2,207,000 and 1.4% and 1.2%, respectively.
Forward-looking Statements
Statements in this press release that are not strictly historical may be "forward-looking" statements, which involve risks and uncertainties. The foregoing material 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. The Company does not undertake, and specifically disclaims, any obligation to publicly release the results of any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances arising after the date hereof.
**An unaudited consolidated balance sheet and income statement are part of this press release**
Wells Financial Corp. and Subsidiary Consolidated Statement of Financial Condition (Dollars in Thousands) (Unaudited) |
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ASSETS |
|||||
09/30/11 |
12/31/10 |
||||
Cash, including interest-bearing accounts: |
$ 14,671 |
$ 8,244 |
|||
09/30/11 $9,302; 12/31/10 $2,468 |
|||||
Certificates of deposit |
3,735 |
- |
|||
Fed Funds Sold |
14,026 |
12,542 |
|||
Securities available for sale |
19,920 |
14,624 |
|||
Securities held to maturity |
- |
- |
|||
Federal Home Loan Stock |
2,360 |
1,859 |
|||
Loans held for sale |
2,928 |
2,217 |
|||
Loans receivable, net |
170,981 |
185,418 |
|||
Accrued interest receivable |
1,149 |
1,366 |
|||
Prepaid Income Taxes |
- |
- |
|||
Foreclosed real estate |
5,091 |
5,628 |
|||
Premises and equipment |
3,369 |
3,439 |
|||
Mortgage servicing rights, net |
1,734 |
1,687 |
|||
Other assets |
1,068 |
1,383 |
|||
TOTAL ASSETS |
$ 241,032 |
$ 238,407 |
|||
LIABILITIES AND EQUITY |
|||||
LIABILITIES: |
|||||
Deposits |
$ 210,914 |
$ 210,819 |
|||
Borrowed funds |
1,300 |
1,785 |
|||
Advances from borrowers for taxes and insurance |
3,358 |
2,300 |
|||
Income taxes: |
|||||
Deferred |
(43) |
- |
|||
Accrued interest payable |
208 |
53 |
|||
Accrued expenses and other liabilities |
736 |
223 |
|||
TOTAL LIABILITIES |
216,473 |
215,180 |
|||
STOCKHOLDER'S EQUITY: |
|||||
Common stock, $.10 par value; 7,000.000 shares |
|||||
authorized; 2,187,500 shares issued |
$ 219 |
$ 219 |
|||
Additional paid in capital |
17,117 |
17,104 |
|||
Retained earnings, substantially restricted |
34,713 |
33,615 |
|||
Other comprehensive income |
368 |
147 |
|||
Treasury stock, at cost, 1,400,705 shares at September |
|||||
30, 2011; 1,400,705 shares at December 31, 2010 |
(27,858) |
(27,858) |
|||
TOTAL EQUITY |
24,559 |
23,227 |
|||
TOTAL LIABILITIES AND EQUITY |
$ 241,032 |
$ 238,407 |
|||
Wells Financial Corp. and Subsidiary Consolidated Statement of Income (Dollars in thousands, except per share data) (Unaudited) |
||||||||||
Three Months Ended |
Nine Months Ended |
|||||||||
September 30, |
September 30, |
|||||||||
2011 |
2010 |
2011 |
2010 |
|||||||
Interest and dividend income |
||||||||||
Loans receivable: |
||||||||||
Residential loans |
$ 590 |
$ 599 |
$ 1,762 |
$ 1,798 |
||||||
Commercial Loans |
512 |
569 |
1,571 |
1,743 |
||||||
Ag Real Estate Loans |
474 |
713 |
1,577 |
2,203 |
||||||
Consumer and other loans |
952 |
1,094 |
2,894 |
3,332 |
||||||
Investment securities and other interest- |
||||||||||
bearings deposits |
149 |
138 |
422 |
434 |
||||||
Total interest income |
2,677 |
3,113 |
8,226 |
9,510 |
||||||
Interest expense |
||||||||||
Deposits |
442 |
725 |
1,510 |
2,383 |
||||||
Borrowed funds |
19 |
159 |
60 |
647 |
||||||
Total interest expense |
461 |
884 |
1,570 |
3,030 |
||||||
Net interest income |
2,216 |
2,229 |
6,656 |
6,480 |
||||||
Provision for loan losses |
376 |
125 |
882 |
505 |
||||||
Net interest income after |
||||||||||
provision for loan losses |
1,840 |
2,104 |
5,774 |
5,975 |
||||||
Noninterest income |
||||||||||
Gain on sale of loans |
345 |
600 |
841 |
1,066 |
||||||
Loan servicing fees |
237 |
237 |
706 |
714 |
||||||
Insurance commissions |
185 |
160 |
486 |
517 |
||||||
Fees and service charges |
132 |
136 |
399 |
409 |
||||||
Other |
139 |
100 |
385 |
358 |
||||||
Total noninterest income |
1,038 |
1,233 |
2,817 |
3,064 |
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Noninterest expense |
||||||||||
Compensation and benefits |
1,084 |
1,046 |
3,212 |
3,158 |
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Occupancy and equipment |
195 |
233 |
633 |
739 |
||||||
Federal insurance premiums |
15 |
115 |
260 |
341 |
||||||
Data processing |
170 |
174 |
545 |
551 |
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Advertising |
68 |
62 |
185 |
177 |
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Amortization & Valuation adjustments for MSR's |
80 |
72 |
229 |
238 |
||||||
Impairment of Securities Available for Sale |
- |
- |
- |
- |
||||||
Other |
582 |
688 |
1,733 |
1,543 |
||||||
Total noninterest expense |
2,194 |
2,390 |
6,797 |
6,747 |
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Income before income taxes |
684 |
947 |
1,794 |
2,292 |
||||||
Income tax expense |
257 |
360 |
695 |
879 |
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Net Income |
$ 427 |
$ 587 |
$ 1,099 |
$ 1,413 |
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Earnings per share |
||||||||||
Basic earnings per share |
$ 0.54 |
$ 0.75 |
$ 1.40 |
$ 1.81 |
||||||
Diluted earnings per share |
$ 0.54 |
$ 0.75 |
$ 1.40 |
$ 1.80 |
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SOURCE Wells Financial Corp.
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