Northeast Indiana Bancorp, Inc. Announces First Quarter Earnings

News provided by

Apr 13, 2012, 11:10 ET

HUNTINGTON, Ind., April 13, 2012 /PRNewswire/ -- Northeast Indiana Bancorp, Inc., (OTCQB: NIDB), the parent company of First Federal Savings Bank, has announced net income of $694,000 ($0.56 per diluted common share) for the first quarter ended March 31, 2012 compared to a net loss of ($14,000) ($0.01 per diluted common share) for the first quarter ended March 31, 2011. The prior year quarterly net loss was due to an outsized loan loss provision that was taken to improve the Bank's Allowance for Loan Loss coverage ratios during that period. The current three months earnings equate to an annualized return on average assets (ROA) of 1.07% and a return on average equity (ROE) of 10.51%.

Commenting on the financial results, First Federal Savings Bank CEO Michael S. Zahn stated, "I'm very proud to announce such strong earnings for the first quarter of 2012. Even factoring out the loan loss provision difference between the two quarterly periods presented, our net income was still $164,000 higher for the current quarter ended March 31, 2012 compared to the quarter ended March 31, 2011. This is due to wider net interest margins and stronger mortgage banking activity in the current quarterly period."

Net interest income was $2.3 million for the quarter ended March 31, 2012 compared to $2.1 million for the quarter ended March 31, 2011. The Company's net interest margin increased 22 basis points to 3.80% for the current quarter compared to 3.58% for the year earlier quarter.

The Company made a $300,000 provision for loan loss during the quarter ended March 31, 2012 compared to a $1.2 million provision for loan loss for the quarter ended March 31, 2011. Management elected to take the higher provision levels in the prior year quarterly period due to increased non-performing assets and continued weakness in the real estate markets during that time period. Net charge-offs were $921,000 for the quarter ended March 31, 2012 compared to net charge-offs of $737,000 for the quarter ended March 31, 2011. Nonperforming assets decreased $1.3 million or 12.8% to $8.6 million at March 31, 2012 when compared to $9.9 million at December 31, 2011.

Noninterest income increased sharply by $210,000 or 44.3% to $684,000 for the current period compared to $474,000 during the year earlier period. The increase is due to a significant increase in net gain on sale of loans of $174,000, an increase in brokerage fees and a decline in net losses on the sale of repossessed assets.

Noninterest expense increased to $1.7 million for the quarter ended March 31, 2012 compared to $1.6 million for the quarter ended March 31, 2011. An increase in professional fees between quarters was due to added legal and examination fees from the Bank's pending charter conversion. There were also increases in wages/benefits, occupancy, data processing and other expense that were partially offset by lower FDIC premiums.

Net loans receivable decreased $4.8 million to $172.1 million at March 31, 2012 when compared to $176.9 million at December 31, 2011. Total deposits increased sharply by $10.5 million or 5.5% to $200.3 million at March 31, 2012 compared to $189.8 million at December 31, 2011. The significant increase in deposits came in non-interest bearing demand, NOW, MMDA and Savings balances through First Federal's full service branches. These newly acquired core deposits were utilized to pay off maturing wholesale borrowed funds. Borrowed funds declined $9.4 million or 21.9% to $33.6 million at March 31, 2012 compared to $43.0 million at December 31, 2012.

Shareholders' equity increased to $26.5 million at March 31, 2012 compared to $26.1 million at December 31, 2011. The book value of NIDB stock was $21.39 per common share as of March 31, 2012. The number of outstanding common shares was 1,239,946. The last reported trade of the stock on April 11, 2012 was $14.13 per common share.

Northeast Indiana Bancorp, Inc. is headquartered at 648 N. Jefferson Street, Huntington, Indiana. The company offers a full array of banking and financial brokerage services to its customers through its main office in Huntington and four full-service Indiana offices in Huntington (2), Warsaw and Fort Wayne. The Company is traded on the OTC Markets Group, Inc. (www.otcmarkets.com) utilizing the OTCQB platform under the symbol "NIDB". Our web site address is www.firstfedindiana.com.

This press release may contain forward-looking statements, which are based on management's current expectations regarding economic, legislative and regulatory issues. Factors which may cause future results to vary materially include, but are not limited to, general economic conditions, changes in interest rates, loan demand, and competition. Additional factors include changes in accounting principles, policies or guidelines; changes in legislation or regulation; and other economic, competitive, regulatory and technological factors affecting each company's operations, pricing, products and services.

NORTHEAST INDIANA BANCORP
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION

*ASSETS*					March 31, 2012		December 31, 2011
Interest-earning cash and cash equivalents					$	11,746,906	$	11,598,753
Noninterest earning cash and cash equivalents					2,452,139		2,495,578
Total cash and cash equivalents					14,199,045		14,094,331
Securities available for sale					59,085,538		55,117,994
Securities held to maturity					351,491		482,807
Loans held for sale					647,050		42,500
Loans receivable, net of allowance for loan loss March 31, 2012 $3,440,919 and December 31, 2011 $4,061,508					172,144,627		176,893,452
Accrued interest receivable					974,943		980,464
Premises and equipment					2,900,287		2,691,780
Investments in limited liability partnerships					134,016		153,813
Cash surrender value of life insurance					7,078,706		7,016,493
Other assets					5,700,689		4,050,116
*Total Assets*					$	263,216,392	$	261,523,750
*LIABILITIES AND STOCKHOLDERS' EQUITY*
Non-interest bearing deposits					17,532,620		14,847,250
Interest bearing deposits					182,801,416		174,988,658
Borrowed Funds					33,567,687		42,955,096
Accrued interest payable and other liabilities					2,788,214		2,587,575
*Total Liabilities*					236,689,937		235,378,579

Retained earnings – substantially restricted					26,526,455		26,145,171
*Total Liabilities and Shareholders' Equity*					$	263,216,392	$		261,523,750

CONSOLIDATED STATEMENTS OF INCOME

	Three Months Ended
	March 31,
	2012		2011
Total interest income	$	2,923,939	$	3,029,647
Total interest expense		625,090		884,363
Net interest income	$	2,298,849	$	2,145,284
Provision for loan losses		300,000		1,200,000
Net interest income after provision for loan losses	$	1,998,849	$	945,284
Service charges on deposit accounts		138,180		135,681
Net gain on sale of loans		235,591		61,812
Net loss on sale of repossessed assets		(23,623)		(49,501)
Brokerage fees		113,546		96,555
Increase in cash surrender value of life insurance		62,213		64,866
Other income		157,680		164,431
Total noninterest income	$	683,587	$	473,844
Salaries and employee benefits		874,755		849,760
Occupancy		236,158		225,769
Data processing		216,467		194,636
Deposit insurance premiums		60,000		84,000
Professional fees		111,745		77,198
Correspondent bank charges		30,421		32,351
Other expense		196,661		179,235
Total noninterest expenses	$	1,726,207	$	1,642,949
Income/(loss) before income tax expenses	$	956,229	$	(223,821)
Income tax expense/(benefit)		262,521		(209,659)
Net Income/(loss)	$	693,708	$	(14,162)

	Three Months Ended March 31,
	2012					2011
Basic Earnings per common share	0.56					(.01)
Dilutive Earnings per share	0.56					(.01)
Net interest margin	3.80%					3.58%
Return on average assets	1.07%					(.02%)
Return on average equity	10.51%					(.23%)
Efficiency ratio	57.88%					62.73%
Average shares outstanding- primary	1,233,870					1,231,160
Average shares outstanding- diluted	1,234,489					1,231,778
Allowance for loan losses:
Balance at beginning of period	$		4,061,508			$		3,227,844
Charge-offs:
One-to-four family	71,320					330,453
Commercial real estate	45,566					-
Land/land development	653,451					284,961
Commercial	176,345					46,588
Consumer	7,713					82,854
Gross charge-offs	954,395					744,856
Recoveries:
One-to-four family	1,349					800
Commercial real estate	-					-
Land/land development	-					-
Commercial	-					-
Consumer	32,457					6,594
Gross recoveries	33,806					7,394
Net charge-offs	920,589					737,462
Additions charged to operations	300,000					1,200,000
Balance at end of period	$		3,440,919			$		3,690,382

Net loan charge-offs to average loans (1)	2.04%					1.58%

Nonperforming assets (000's)	At March 31,					At December 31,
Loans:	2012					2011
Non-accrual		$		4,066			$		7,474
Past 90 days or more and still accruing	-					-
Troubled debt restructured	1,419					1,213
Total nonperforming loans	5,485					8,687
Real estate owned	3,162					1,242
Other repossessed assets	10					-
Total nonperforming assets		$		8,657			$		9,929

Nonperforming assets to total assets				3.29%					3.85%
Nonperforming loans to total loans				3.12%					4.80%
Allowance for loan losses to nonperforming loans				62.73%					46.76%
Allowance for loan losses to net loans receivable					2.00%				2.30%


	At March 31,
	2012					2011

Stockholders' equity as a % of total assets	10.08%					9.45%
Book value per share		$ 21.39					$ 19.48
Common shares outstanding- EOP	1,239,946					1,239,946

(1) Ratios for the three-month periods are annualized.