UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date of
Report (Date of earliest event reported): January
21,
2009
NORTHEAST
BANCORP
(Exact
Name of Registrant as Specified in its Charter)
|
Maine
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1-14588
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01-0425066
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(State
or Other Jurisdiction Incorporation)
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(Commission
File Number)
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(IRS
Employer Identification
Number)
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|
500 Canal Street,
Lewiston, Maine
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04240
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|
(Address
of Principal Executive Offices)
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(Zip
Code)
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Registrant's
telephone number, including area code:
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(207)
786-3245
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Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions.
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425).
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12).
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|
o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)).
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240. Rule 13e-4(c)).
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Item
9.01
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Financial
Statements and Exhibits.
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(c)
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Exhibits.
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Exhibit No.
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Description
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99.1
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Press
Release, dated January 21, 2009 regarding second quarter 2009 earnings and
the declaration of a
dividend.
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Item
7.01 Regulation FD Disclosure.
On
January 21, 2009, Northeast Bancorp, a Maine corporation (the "Company"), issued
a press release announcing its earnings for the second quarter ended December
31, 2008 and declaring the payment of a dividend. The full text of this press
release is attached hereto as Exhibit 99.1 and is incorporated herein by
reference.
The
information contained herein, including the exhibit attached hereto, is
furnished pursuant to Item 7.01 of this Form 8-K and shall not be deemed "filed"
for purposes of Section 18 of the Securities Exchange Act of 1934, as amended,
or otherwise subject to the liability of that section. Further, the
information in this report (including the exhibits hereto) are not to be
incorporated by reference into any of the Company's filings with the Securities
and Exchange Commission, whether filed prior to or after the furnishing of these
certificates, regardless of any general or specific incorporation language in
such filing.
Item
2.02 Results of Information and Financial
Condition.
The press
release referred to under Item 7.01 above and filed as Exhibit 99.1 hereto
included disclosure regarding the earnings and financial results of Northeast
Bancorp for the second quarter ended December 31, 2008 and declaration of a
dividend. The full text of this press release is attached hereto as Exhibit 99.1
and is incorporated herein by reference.
The
information contained herein, including the exhibit attached
hereto, is furnished pursuant to Item 2.02 of this Form 8-K and shall
not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act
of 1934, as amended, or otherwise subject to the liability of that
section. Further, the information in this report (including the
exhibits hereto) are not to be incorporated by reference into any of the
Company's filings with the Securities and Exchange Commission, whether filed
prior to or after the furnishing of these certificates, regardless of any
general or specific incorporation language in such filing.
[Rest
of Page Intentionally Blank. Signature on Following
Page.]
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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NORTHEAST
BANCORP
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||
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Date:
January 22, 2009
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By:
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/s/ James D.
Delamater
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James
D. Delamater
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||
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President
and Chief Executive Officer
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EXHIBIT
INDEX
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Exhibit No.
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Description
|
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99.1
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Press
Release, dated January 21, 2009 regarding second quarter 2009 earnings and
the declaration of a
dividend.
|
|
FOR
IMMEDIATE RELEASE
|
 |
|
For
More Information:
Jim
Delamater, President & CEO
Northeast Bank, 500 Canal Street,
Lewiston, ME 04240
www.northeastbank.com |
1-800-284-5989
ext. 3569
jdelamater@northeastbank.com |
Northeast
Bancorp Announces Year to Date Earnings and Declares Dividend
Lewiston,
MAINE (January 21, 2009)
- - Northeast Bancorp (NASDAQ: NBN), the parent company of Northeast Bank
(www.northeastbank.com), reported net income for the quarter ended December 31,
2008 of $293,575 or $.12 per diluted share, an increase of $224,459 or 424%,
over the linked quarter ended September 30, 2008 and a decrease of $108,853 or
27%, over the quarter ended December 31, 2007. Results for the six months ended
December 31, 2008 were $362,690 or $0.15 per diluted share, compared to net
income for the six months ended December 31, 2007 of $832,993 or $0.35 per
diluted share.
Revenues
from operations (net interest income plus noninterest income) continue to grow,
reflecting an increase of approximately $1 million for the quarter ended
December 31, 2008 as compared to the same period last year, and an increase of
approximately $2 million year to date over the same period last year. In
addition, revenues from non-traditional banking services, such as insurance and
investments continue to keep pace, a 31% growth to date over last
year.
Jim
Delamater, President and CEO of Northeast Bancorp since 1981 states, “The
economy is under tremendous pressure and I am pleased that our long-term
strategic plan remains on track to deliver a diverse array of financial products
and services to our market areas. We continue to take actions to protect the
integrity of our balance sheet in order to support the risk associated with the
present economic downturn. As such, our earnings reflect the conservative manner
in which we continue to manage our loan operations, steering clear of lending
programs without traditional underwriting standards and maintaining our
common-sense underwriting and risk-rating guidelines.”
Net
interest income increased 18% for the quarter ended December 31, 2008 compared
to the quarter ended December 31, 2007, and 15% for the six months ended
December 31, 2008 compared to the six months ended December 31,
2007. Net interest income increased primarily from a better net
interest margin, which increased 33 basis points and 34 basis points,
respectively, for the quarter and six months ended December 31,
2008. This increase in net interest margin was attributable to a
decrease in cost of funds. Leveraging the balance sheet with investment
securities increased earning assets some $29 million, which also contributed to
increasing net interest income.
The
Company reports that the decrease in net income in comparison to the same
periods during the previous fiscal year was due in part to limited growth in the
size of its loan portfolio and a build-up of loan loss reserves. Another
contributing factor was the increase in non-interest expenses related to the
previously reported expansion of Northeast Bank Insurance Group. This has been
an aggressive move, made to diversify the company’s revenue streams and has been
ongoing over the past 24 months.
Compared
to the quarter ended September 30, 2008, the balances of delinquent loans and
non-performing loans and assets increased. As a result, the allowance for loan
losses was increased during the quarter ended December 31, 2008 through a
provision for loan losses of $504,000. The allowance represented 1.40% of total
loans at December 31, 2008 compared to 1.38% of total loans at September 30,
2008. Management believes that the allowance for loan losses balance of $5.7
million at December 31, 2008 is sufficient to cover losses inherent in the
loan portfolio on that date and is appropriate based on applicable accounting
standards.
“There is
no credit crunch at Northeast Bank. In fact, our expanded mortgage operations
are very active and we have been able to add experienced mortgage loan
originators to support our growing demand for mortgage loans,” explains
Delamater.
The
company had over $619 million in assets at December 31, 2008, with net loans
demonstrating a slight increase of $420 thousand at December 31, 2008 as
compared to December 31, 2007. Northeast Bancorp continues to grow and expand,
this quarter announcing the opening of a four-person loan production office in
Portsmouth, New Hampshire. The company now employs over 250 people and operates
in both Maine and New Hampshire.
In
addition to announcing earnings, the company declared the payment of its regular
quarterly dividend of $0.09 per share, payable on February 20, 2009 to the
shareholders of record as of January 30, 2009. The company has paid a dividend
every quarter since going public in 1987.
Delamater
notes, “Northeast Bancorp is well positioned for the future as we embrace a
visionary business model that delivers one-stop shopping for financial products.
We continue to generate upwards of 40% of our revenue from non-interest sources,
a level that is well above that of our peers. We will continue to forge ahead,
developing new technologies and launching new products to meet the growing needs
of our customers, while maintaining the value and diversity of the Northeast
Bancorp franchise for our shareholders.”
Capital
Purchase Program (CPP)
During
this past quarter, the company announced that it received $4,227,000 in capital
from the U.S. Treasury’s Capital Purchase Program, which was designed
specifically for healthy banks to help stimulate the economy. In return, the
company issued the U.S. Treasury shares of Northeast Bancorp preferred stock and
warrants to purchase Northeast Bancorp common stock. The $4,227,000 in capital
represents approximately 1% of Northeast’s risk-based assets, the minimum level
for participation in the program. Northeast’s risk-based capital ratio was
12.10% at December 31, 2008, well above required regulatory levels.
“With the
downshift in the economy it is our responsibility to help our customers and
provide viable and affordable financing options and, when necessary, loan
work-outs and modifications, explains Delamater. “This relatively small
injection of capital received through CPP is being invested back into our
markets in the form of new loans for borrowers.”
About
Northeast Bancorp
Northeast
Bancorp (NASDAQ: NBN) is the holding company for Northeast Bank, a leader in
delivering one-stop shopping for financial services. Headquartered in Lewiston,
Maine, Northeast Bank, together with its wholly owned subsidiary Northeast Bank
Insurance Group, Inc. derives its income from a combination of traditional
banking services and non-traditional financial products and services including
insurance and investments. Northeast Bank operates eleven traditional bank
branches, fourteen insurance offices, three investment centers and a loan
production office that serve seven counties in Maine and two in New Hampshire.
Information regarding Northeast Bank can be found on its website at www.northeastbank.com
or by contacting 1-800-284-5989.
---------------------------------------------------------------------------------------------------------------------
This
communication contains certain “forward-looking statements”. Although
the Company believes that these forward-looking statements are based on
reasonable estimates and assumptions, they are not guarantees of future
performance and are subject to known and unknown risks, uncertainties, and other
factors. These statements speak only as of the date of this report
and we do not undertake any obligation to update or revise any of these
forward-looking statements to reflect events or circumstances occurring after
the date of this communication or to reflect the occurrence of unanticipated
events. For a more complete discussion of certain risks and
uncertainties affecting the Company, please see "Item 1.
Business-Forward-Looking Statements and Risk Factors" set forth in the Company's
Form 10-K for the year ended June 30, 2008.
Customer
access to securities is provided through Commonwealth Financial Network, Member
NASD/SIPC. Important
information--Securities, annuities, and insurance products are not deposit
products, not FDIC insured, are subject to investment risk, including the
possible loss of principal, and are not an obligation of or guaranteed by the
Bank.
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NORTHEAST
BANCORP
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||||||||||||||||||||||||
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(Dollars
in Thousands, Except Per Share and Shares Outstanding
Data)
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||||||||||||||||||||||||
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(Unaudited)
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||||||||||||||||||||||||
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Three
Months Ended
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Six
Months Ended
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|||||||||||||||||||||||
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December
31,
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%
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December
31,
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%
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|||||||||||||||||||||
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2008
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2007
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Change
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2008
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2007
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Change
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|||||||||||||||||||
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Selected
financial information
|
||||||||||||||||||||||||
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Income
statement data:
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||||||||||||||||||||||||
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Interest
income
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$ | 8,653 | $ | 9,073 | -5 | % | $ | 17,248 | $ | 18,029 | -4 | % | ||||||||||||
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Interest
expense
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4,426 | 5,503 | -20 | % | 8,980 | 10,867 | -17 | % | ||||||||||||||||
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Net
interest income
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4,227 | 3,570 | 18 | % | 8,268 | 7,162 | 15 | % | ||||||||||||||||
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Provision
for loan losses
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504 | 180 | 180 | % | 1,024 | 370 | 177 | % | ||||||||||||||||
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Net
interest income afterprovision for loan losses
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3,723 | 3,390 | 10 | % | 7,244 | 6,792 | 7 | % | ||||||||||||||||
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Gain
on sale of loans
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111 | 121 | -8 | % | 223 | 274 | -19 | % | ||||||||||||||||
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Gain
(loss) on securities
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26 | (2 | ) | -1400 | % | (82 | ) | (8 | ) | 925 | % | |||||||||||||
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Investment
brokerage income
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608 | 586 | 4 | % | 1,028 | 984 | 4 | % | ||||||||||||||||
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Insurance
agency income
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1,431 | 1,099 | 30 | % | 2,948 | 1,965 | 50 | % | ||||||||||||||||
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Other
noninterest income
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575 | 592 | -3 | % | 1,194 | 1,171 | 2 | % | ||||||||||||||||
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Noninterest
Income
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2,751 | 2,396 | 15 | % | 5,311 | 4,386 | 21 | % | ||||||||||||||||
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Noninterest
expense
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6,141 | 5,281 | 16 | % | 12,230 | 10,122 | 21 | % | ||||||||||||||||
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Operating
(loss) income before income tax
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333 | 505 | -34 | % | 325 | 1,056 | -69 | % | ||||||||||||||||
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Income
tax (benefit) expense
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39 | 103 | -62 | % | (38 | ) | 223 | -117 | % | |||||||||||||||
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Net
income
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$ | 294 | $ | 402 | -27 | % | $ | 363 | $ | 833 | -56 | % | ||||||||||||
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Per
share data:
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||||||||||||||||||||||||
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Basic
earning per common share
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$ | 0.12 | $ | 0.17 | -29 | % | $ | 0.15 | $ | 0.35 | -57 | % | ||||||||||||
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Diluted
earnings per common share
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$ | 0.12 | $ | 0.17 | -29 | % | $ | 0.15 | $ | 0.35 | -57 | % | ||||||||||||
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Weighted
average shares outstanding:
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||||||||||||||||||||||||
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Basic
|
2,321,264 | 2,357,104 | -2 | % | 2,318,353 | 2,386,528 | -3 | % | ||||||||||||||||
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Diluted
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2,321,480 | 2,370,853 | -2 | % | 2,330,163 | 2,402,895 | -3 | % | ||||||||||||||||
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Book
value per share
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$ | 18.82 | $ | 17.73 | $ | 18.82 | $ | 17.73 | ||||||||||||||||
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Tangible
book value per share
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$ | 13.46 | $ | 11.91 | $ | 13.46 | $ | 11.91 | ||||||||||||||||
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Net
interest margin
|
2.99 | % | 2.66 | % | 2.95 | % | 2.71 | % | ||||||||||||||||
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Net
interest spread
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2.82 | % | 2.39 | % | 2.76 | % | 2.40 | % | ||||||||||||||||
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Return
on average assets (annualized)
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0.19 | % | 0.28 | % | 0.12 | % | 0.29 | % | ||||||||||||||||
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Return
on equity (annualized)
|
2.75 | % | 3.85 | % | 1.74 | % | 4.01 | % | ||||||||||||||||
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Tier
I leverage ratio (Bank)
|
7.62 | % | 6.89 | % | 7.62 | % | 6.89 | % | ||||||||||||||||
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Tier
I risk-based capital ratio (Bank)
|
10.85 | % | 9.61 | % | 10.85 | % | 9.61 | % | ||||||||||||||||
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Total
risk-based capital ratio (Bank)
|
12.10 | % | 10.86 | % | 12.10 | % | 10.86 | % | ||||||||||||||||
|
Efficiency
ratio
|
88 | % | 89 | % | 90 | % | 88 | % | ||||||||||||||||
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Nonperforming
loans
|
7,369 | 6,610 | 7,369 | 6,610 | ||||||||||||||||||||
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Total
nonperforming assets
|
8,111 | 6,610 | 8,111 | 6,610 | ||||||||||||||||||||
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Nonperforming
loans as a % of total loans
|
1.81 | % | 1.62 | % | 1.81 | % | 1.62 | % | ||||||||||||||||
|
Nonperforming
assets as a % of total assets
|
1.31 | % | 1.12 | % | 1.31 | % | 1.12 | % | ||||||||||||||||
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December
31,
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%
|
|||||||||||||||||||||||
|
2008
|
2007
|
Change
|
||||||||||||||||||||||
|
Balance
sheet highlights:
|
||||||||||||||||||||||||
|
Available-for-sale
securities, at fair value
|
$ | 157,834 | $ | 129,754 | 22 | % | ||||||||||||||||||
|
Loans
held for sale
|
1,357 | 706 | 92 | % | ||||||||||||||||||||
|
Loans
|
408,243 | 408,236 | 0 | % | ||||||||||||||||||||
|
Allowance
for loan losses
|
5,721 | 5,756 | -1 | % | ||||||||||||||||||||
|
Goodwill
& intangibles
|
12,451 | 13,537 | -8 | % | ||||||||||||||||||||
|
Total
assets
|
618,653 | 588,398 | 5 | % | ||||||||||||||||||||
|
Deposits:
|
||||||||||||||||||||||||
|
NOW
and money market
|
71,221 | 63,772 | 12 | % | ||||||||||||||||||||
|
Savings
|
18,559 | 19,674 | -6 | % | ||||||||||||||||||||
|
Certificates
of deposits
|
224,943 | 225,975 | 0 | % | ||||||||||||||||||||
|
Brokered
time deposits
|
17,547 | 20,957 | -16 | % | ||||||||||||||||||||
|
Noninterest-bearing
deposits
|
32,721 | 33,271 | -2 | % | ||||||||||||||||||||
|
Total
deposits
|
364,991 | 363,649 | 0 | % | ||||||||||||||||||||
|
Borrowings
|
203,406 | 180,523 | 13 | % | ||||||||||||||||||||
|
Shareholders'
equity
|
47,914 | 41,219 | 16 | % | ||||||||||||||||||||
|
Shares
outstanding
|
2,321,332 | 2,324,182 | 0 | % | ||||||||||||||||||||