Wake Forest Bancshares, Inc. Announces First Quarter Results

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Jan 18, 2012, 12:34 ET

WAKE FOREST, N.C., Jan. 18, 2012 /PRNewswire/ -- Wake Forest Bancshares, Inc., (OTC Electronic Bulletin Board: WAKE) parent company of Wake Forest Federal Savings and Loan Association, announced today that the Company reported earnings of $151,047 or $0.13 per share for its quarter ended December 31, 2011. The first quarter results were similar to one year earlier when the Company reported earnings of $146,858 or $0.13 per share for the quarter ended December 31, 2010.

In announcing the earnings, Robert C. White, President and Chief Executive Officer, stated that given the operating environment, the Company was pleased with its quarterly results. Although the Company's earnings continue to be impacted by compressed interest rate margins, the Company has shown some improvement in its level of non-performing assets and associated loan loss provisions, charge-offs, and costs related to foreclosed properties from its fiscal year ended September 30, 2011. A significant portion of the Company's loans and investments have either shorter maturities or variable rates and therefore the portfolios tend to move in tandem with the prime rate. The Federal Reserve has kept interest rates at historic lows since December of 2008 and the Company's interest rate sensitive loan and investment portfolios have adjusted to those rate movements to a greater extent than has the Company's deposit base.

The lackluster economic conditions along with a weakened housing market for the past three years have continued to negatively influence the Company's operations. Real estate lending, including construction lending, are at levels significantly below what is considered normal for the Company's markets. As a historically high growth area, relocation sales have typically represented a sizable portion of our local real estate market but have suffered during this period because of limited job opportunities. The broader local real estate market has stagnated primarily because the economy has created uncertainty and buyers have either elected to forego home purchases in the interim or have been unable to qualify for financing.

The Company provided $68,500 and $70,000, respectively, during the current quarter and the same period a year earlier in loan loss provisions and write downs to the value of its foreclosed properties. The Company had no loans charged off during the current quarter as compared to $30,000 in charge-offs during the quarter ended December 31, 2010. The Company also incurred $21,900 in foreclosure related expense and a net profit $9,286 from the sale of foreclosed properties during the quarter ended December 31, 2011. In comparison, the Company incurred $30,962 in foreclosure related expense and a net profit of $953 from disposing of foreclosed properties during the quarter ended December 31, 2010. The Company's loan loss allowances amounted to approximately 1.89% of total loans outstanding at December 31, 2011. Foreclosed assets and non-performing loans amounted to $1,312,350 and $2,077,643, respectively, at December 31, 2011.

Total assets of the Company amounted to $115,940,408 at December 31, 2011. Total loans receivable and deposits outstanding at December 31, 2011 amounted to $70,655,919 and $93,537,682, respectively. Wake Forest Bancshares Inc.'s capital to assets ratio was 18.18% at December 31, 2011.

Wake Forest Bancshares, Inc. has 1,154,535 shares of common stock outstanding. Based in Wake Forest, North Carolina since 1922, the Company conducts business as Wake Forest Federal from its office in Wake Forest, (Wake County), North Carolina.

SOURCE Wake Forest Federal