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 30, 2012
NORTHEAST BANCORP
(Exact Name of Registrant as Specified in its Charter)
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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 2.02 Results of Information and Financial Condition.
On January 27, 2012, Northeast Bancorp, a Maine corporation (the "Company"), issued a press release announcing its earnings for the second quarter ended December 31, 2011 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 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.
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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 of the Company, dated January 27, 2012
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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 30, 2012
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By:
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/s/ Claire S. Bean
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Claire S. Bean
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||
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Chief Financial 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 of the Company, dated January 27, 2012
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FOR IMMEDIATE RELEASE
For More Information:
|
 |
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Claire S. Bean, Chief Financial Officer & C.O.O.
Northeast Bank, 500 Canal Street, Lewiston, ME 04240
207.786.3245 ext. 6202
www.northeastbank.com
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Northeast Bancorp Reports Second Quarter Results, Declares Dividend
Lewiston, ME (January 27, 2012) ‒ Northeast Bancorp (“Northeast” or the “Company”) (NASDAQ: NBN), a Maine-based full-service financial services company and parent of Northeast Bank, today reported net income of $418 thousand, or $0.09 per diluted common share, for the quarter ended December 31, 2011. For the six months ended December 31, 2011, the Company earned net income of $947 thousand, or $0.21 per diluted common share.
The Board of Directors has declared a cash dividend of $0.09 per share, payable on February 24, 2012 to shareholders of record as of February 10, 2012.
Results for the six months ended December 31, 2011 include net income from discontinued operations of $1.1 million, which included the gain earned on the sale of the Company’s insurance agency business. As announced in the first quarter of fiscal year 2012, the assets of Northeast’s insurance agency division were acquired by local agencies in two separate transactions. The sale yielded a pre-tax gain of $1.5 million and served to increase the Company’s tangible capital. At December 31, 2011, the Company’s tangible book value per share was $16.15, compared to $13.58 at June 30, 2011.
“We continue to make progress in positioning Northeast for growth and success,” said Richard Wayne, President and Chief Executive Officer of Northeast. “We made significant investments in 2011 in our new loan purchasing business, and in our online affinity deposit program, ableBanking, which we expect to launch this quarter. We are particularly encouraged by the progress of our Loan Acquisition and Servicing Group, which primarily purchases performing commercial real estate loans, on a nationwide basis, at a discount from their outstanding principal balances, producing yields higher than those normally achievable on the Company’s originated loans. During the six month period ending December 31, 2011, we purchased loans totaling $51.7 million. The purchased loan portfolio produced a yield of 15.8%, including accelerated interest income associated with unscheduled loan payoffs during the six months ended December 31, 2011. There were no purchased loans delinquent at quarter-end.”
Quarterly results included the following items of significance:
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1.
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An improved net interest margin (“NIM”), which increased to 3.53%, compared to 3.09% in the first quarter of fiscal year 2012. Improvement in the NIM is principally the result of growth in the Company’s purchased loan portfolio, which increased to $51.5 million at December 31, 2011 from $637 thousand at June 30, 2011. The yield on the purchased loan portfolio was 16.1% and 15.8% for the three and six months ended December 31, 2011, respectively, compared to a yield of 5.9% and 6.1% for the three and six month periods, respectively, on the Company’s originated loan portfolio. The following summarizes interest income and related yields recognized on the Company’s purchased loan and originated loan portfolios for the three and six months ended December 31, 2011.
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Three Months Ended December 31, 2011
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Six Months Ended December 31, 2011
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||||||||||||||
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Average
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Interest
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Average
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Average
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Interest
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Average
|
||||||||||
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Daily
|
Income/
|
Yield/
|
Daily
|
Income/
|
Yield/
|
||||||||||
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Balance
|
Expense
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Rate
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Balance
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Expense
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Rate
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||||||||||
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(Dollars in thousands)
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|||||||||||||||
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Loans - originated
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$
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309,171
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$
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4,620
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5.93%
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$
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309,948
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$
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9,557
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6.12%
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|||||
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Loans - purchased
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31,001
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1,254
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16.05%
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18,262
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1,454
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15.79%
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|||||||||
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Total
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$
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340,172
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$
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5,874
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6.85%
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$
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328,210
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$
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11,011
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6.66%
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|||||
The yield on purchased loans was increased by unscheduled loans payoffs during the period, which resulted in immediate recognition of the prepaid loans’ discount in interest income. The following table details the components of the yield on purchased loans during the three and six months ended December 31, 2011. “Accelerated accretion” represents the amount of a loan’s discount recognized resulting from an unscheduled payoff or principal payment.
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Three Months Ended December 31, 2011
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Six Months Ended December 31, 2011
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||||||||||||||
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Average
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Interest
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Average
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Average
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Interest
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Average
|
||||||||||
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Daily
|
Income/
|
Yield/
|
Daily
|
Income/
|
Yield/
|
||||||||||
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Balance
|
Expense
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Rate
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Balance
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Expense
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Rate
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||||||||||
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(Dollars in thousands)
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|||||||||||||||
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Regularly scheduled
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|||||||||||||||
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interest and accretion
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$
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31,001
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$
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772
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9.88%
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$
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18,262
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$
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972
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10.56%
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|||||
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Accelerated accretion
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31,001
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482
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6.17%
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18,262
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482
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5.24%
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|||||||||
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Total
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31,001
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$
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1,254
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16.05%
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18,262
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$
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1,454
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15.79%
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|||||||
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2.
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The sale of a commercial real estate loan for a gain of $203 thousand. The loan had been reported as nonperforming in previous quarters.
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3.
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A net gain on sale of available-for-sale investment securities of $433 thousand.
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4.
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Increased noninterest expenses, principally resulting from increased marketing expenses and up-front staffing and infrastructure costs for the Company’s new loan purchasing and deposit initiatives.
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Total assets declined by $1.8 million or 0.3% to $594.6 million at December 31, 2011, compared to total assets of $596.4 million at June 30, 2011. The principal components of the change in the balance sheet during the six months ended December 31, 2011 were as follows:
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1.
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A $35.1 million, or 15.0%, decrease in cash and investments, principally as a result of growth in loans during the period. Cash and securities, net of holdings pledged as collateral for borrowed funds, represent 21.0% of total assets at quarter-end, a level of balance sheet liquidity that is intended in part for future purchases of commercial loans.
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2.
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Loan growth of $37.1 million or 12.0%, principally due to growth of $50.8 million in loans purchased by the Company’s Loan Acquisition and Servicing Group, offset in part by amortization and payoffs from the originated loan portfolio of $13.7 million;
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3.
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A $4.2 million, or 3.0%, reduction in borrowed funds, resulting primarily from the $2.1 million repayment of insurance agency debt in connection with the insurance transaction;
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4.
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An $8.1 million, or 6.2%, decrease in intangible assets, resulting primarily from the insurance agency transaction.
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Non-performing assets were essentially unchanged at $7.7 million or 1.3% of total assets at December 31, 2011, compared to $7.9 million or 1.3% of total assets at June 30, 2011.
At December 31, 2011, the Company’s tier 1 leverage ratio was 11.9%, an increase from 10.3% at June 30, 2011 and the total risk-based capital ratio was 19.3%, an increase from 19.0% at June 30, 2011.
About Northeast Bancorp
Northeast Bancorp (NASDAQ: NBN) is the holding company for Northeast Bank, a full service bank headquartered in Lewiston, Maine. Northeast Bank derives its income from a combination of traditional banking services as well as from its Loan Acquisition and Servicing Group, which purchases performing commercial loans for the Bank’s portfolio. ableBanking, a division of Northeast Bank, launching in 2012 will offer savings products to consumers online, through affinity partnerships with non-profit organizations. Northeast Bank operates ten bank branches, three investment centers and four loan production offices 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.
On December 29, 2010, FHB Formation LLC (“FHB”) merged with and into Northeast, with Northeast as the surviving company. The Company applied the acquisition method of accounting, as described in Accounting Standards Codification 805, Business Combinations, to this transaction, which represents an acquisition by FHB of Northeast, with Northeast as the surviving company. As a result, the Company’s financial statements from the periods prior to the transaction date are not directly comparable to the financial statements for periods subsequent to the transaction date. To make this distinction, the Company has labeled balances and results of operations prior to the transaction date as “Predecessor Company” and balances and results of operations for periods subsequent to the transaction date as “Successor Company.” The lack of comparability arises from the assets and liabilities having new accounting bases as a result of recording them at their fair values as of the transaction date rather than at historical cost basis. To denote this lack of comparability, the Company has placed a heavy black line between the Successor Company and Predecessor Company columns in its consolidated financial statements and, where applicable, in this discussion.
Non-GAAP Financial Measure
In addition to results presented in accordance with generally accepted accounting principles ("GAAP"), this press release contains certain non-GAAP financial measures. Northeast's management believes that the supplemental non-GAAP information, which consists of tangible book value, is utilized by regulators and market analysts to evaluate a company's financial condition and therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.
_________________________________________________________________________________________________________________________________________________________
Statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Although Northeast 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. You should not place undue reliance on our forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they are subject to significant risks, uncertainties and other factors which are, in some cases, beyond the Company's control. The Company's actual results could differ materially from those projected in the forward-looking statements as a result of, among other factors, changes in interest rates; competitive pressures from other financial institutions; the effects of a continuing deterioration in general economic conditions on a national basis or in the local markets in which the Company operates, including changes which adversely affect borrowers' ability to service and repay our loans; changes in loan defaults and charge-off rates; changes in the value of securities and other assets, adequacy of loan loss reserves, or deposit levels necessitating increased borrowing to fund loans and investments; increasing government regulation, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010; the risk that goodwill and intangibles recorded in the Company's financial statements will become impaired; changes in assumptions used in making such forward-looking statements; and the other risks and uncertainties detailed in the Company's Annual Report on Form 10-K and updated by the Company's Quarterly Reports on Form 10-Q; and other filings submitted to the Securities and Exchange Commission. These statements speak only as of the date of this release 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.
IMPORTANT NOTE: Securities and Advisory Services offered through Commonwealth Financial Network, Member FINRA, SIPC, and a Registered Investment Adviser. Securities are not FDIC insured, not bank obligations or otherwise bank guaranteed and may lose value. Northeast Financial is located at 202 Rte. 1, Suite 206, Falmouth, ME 04105.
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NORTHEAST BANCORP AND SUBSIDIARY
|
||||||||
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CONSOLIDATED BALANCE SHEETS
(Unaudited)
|
||||||||
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(Dollars in thousands, except per share data)
|
||||||||
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December 31, 2011
|
June 30, 2011
|
|||||||
|
Assets
|
||||||||
|
Cash and due from banks
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$ | 3,005 | $ | 3,227 | ||||
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Short-term investments
|
55,358 | 80,704 | ||||||
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Total cash and cash equivalents
|
58,363 | 83,931 | ||||||
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Available-for-sale securities, at fair value
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139,480 | 148,962 | ||||||
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Loans held-for-sale
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8,189 | 5,176 | ||||||
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Loans
|
||||||||
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Residential real estate
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98,129 | 95,417 | ||||||
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Commercial real estate
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162,999 | 117,761 | ||||||
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Construction
|
1,280 | 2,015 | ||||||
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Commercial business
|
19,210 | 22,225 | ||||||
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Consumer
|
65,441 | 72,495 | ||||||
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Total loans
|
347,059 | 309,913 | ||||||
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Less: Allowance for loan losses
|
737 | 437 | ||||||
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Loans, net
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346,322 | 309,476 | ||||||
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Premises and equipment, net
|
9,262 | 8,271 | ||||||
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Acquired assets, net
|
837 | 690 | ||||||
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Accrued interest receivable
|
1,761 | 1,244 | ||||||
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Federal Home Loan Bank stock, at cost
|
4,889 | 4,889 | ||||||
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Federal Reserve Bank stock, at cost
|
871 | 871 | ||||||
|
Intangible assets, net
|
5,012 | 13,133 | ||||||
|
Bank owned life insurance
|
14,047 | 13,794 | ||||||
|
Other assets
|
5,522 | 5,956 | ||||||
|
Total assets
|
$ | 594,555 | $ | 596,393 | ||||
|
Liabilities and Stockholders' Equity
|
||||||||
|
Liabilities
|
||||||||
|
Deposits
|
||||||||
|
Demand
|
$ | 43,682 | $ | 48,215 | ||||
|
Savings and interest checking
|
87,356 | 89,804 | ||||||
|
Money market
|
43,353 | 48,695 | ||||||
|
Brokered time deposits
|
4,905 | 4,924 | ||||||
|
Certificates of deposit
|
221,728 | 209,480 | ||||||
|
Total deposits
|
401,024 | 401,118 | ||||||
|
Federal Home Loan Bank advances
|
43,684 | 43,922 | ||||||
|
Structured repurchase agreements
|
67,089 | 68,008 | ||||||
|
Short-term borrowings
|
1,744 | 2,515 | ||||||
|
Junior subordinated debentures issued to affiliated trusts
|
8,029 | 7,957 | ||||||
|
Capital lease obligation
|
1,994 | 2,075 | ||||||
|
Other borrowings
|
0 | 2,229 | ||||||
|
Other liabilities
|
5,091 | 3,615 | ||||||
|
Total liabilities
|
528,655 | 531,439 | ||||||
|
Commitments and contingencies
|
||||||||
|
Stockholders' equity
|
||||||||
|
Preferred stock, $1.00 par value, 1,000,000 shares authorized; 4,227
shares issued and outstanding at December 31, 2011 and June 30,
2011; liquidation preference of $1,000 per share
|
4 | 4 | ||||||
|
Voting common stock, $1.00 par value, 13,500,000 shares authorized; 3,312,173
issued and outstanding at December 31, 2011 and June 30, 2011, respectively
|
3,312 | 3,312 | ||||||
|
Non-voting common stock, $1.00 par value, 1,500,000 shares authorized
195,351 issued and outstanding at December 31, 2011 and June 30, 2011, respectively
|
195 | 195 | ||||||
|
Warrants to purchase common stock
|
406 | 406 | ||||||
|
Additional paid-in capital
|
49,982 | 49,700 | ||||||
|
Unearned restricted stock
|
(145 | ) | (163 | ) | ||||
|
Retained earnings
|
11,846 | 11,726 | ||||||
|
Accumulated other comprehensive income (loss)
|
300 | (226 | ) | |||||
|
Total stockholders' equity
|
65,900 | 64,954 | ||||||
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Total liabilities and stockholders' equity
|
$ | 594,555 | $ | 596,393 | ||||
|
NORTHEAST BANCORP AND SUBSIDIARY
|
||||||||||||||||
|
CONSOLIDATED STATEMENTS OF INCOME
|
||||||||||||||||
|
(Unaudited)
|
||||||||||||||||
|
(Dollars in thousands, except per share data)
|
||||||||||||||||
|
Successor Company (1)
|
Predecessor Company (2)
|
|||||||||||||||
| Three Months Ended |
Six Months Ended
|
Three Days Ended
|
89 Days Ended
|
181 Days Ended
|
||||||||||||
| December 31, 2011 |
December 31, 2011
|
December 31, 2010
|
December 28, 2010
|
December 28, 2010
|
||||||||||||
|
Interest and dividend income:
|
||||||||||||||||
|
Interest on loans
|
$
|
5,874
|
$
|
11,011
|
$
|
196
|
$
|
5,468
|
$
|
11,210
|
||||||
|
Interest and dividends on available-for-sale securities
|
541
|
1,180
|
45
|
1,439
|
3,111
|
|||||||||||
|
Dividends on regulatory stock
|
21
|
33
|
0
|
9
|
18
|
|||||||||||
|
Other interest and dividend income
|
36
|
83
|
1
|
28
|
39
|
|||||||||||
|
Total interest and dividend income
|
6,472
|
12,307
|
242
|
6,944
|
14,378
|
|||||||||||
|
Interest expense:
|
||||||||||||||||
|
Deposits
|
836
|
1,673
|
42
|
1,273
|
2,796
|
|||||||||||
|
Federal Home Loan Bank advances
|
258
|
516
|
15
|
451
|
918
|
|||||||||||
|
Structured repurchase agreements
|
249
|
497
|
23
|
685
|
1,392
|
|||||||||||
|
Short-term borrowings
|
3
|
8
|
6
|
205
|
376
|
|||||||||||
|
Junior subordinated debentures issued to affiliated trusts
|
185
|
368
|
6
|
167
|
340
|
|||||||||||
|
Obligation under capital lease agreements
|
25
|
51
|
1
|
27
|
55
|
|||||||||||
|
Total interest expense
|
1,556
|
3,113
|
93
|
2,808
|
5,877
|
|||||||||||
|
Net interest and dividend income before provision for
loan losses |
4,916
|
9,194 |
149 |
4,136
|
8,501
|
|||||||||||
|
Provision for loan losses
|
134
|
534
|
0
|
453
|
912
|
|||||||||||
|
Net interest and dividend income after provision for
loan losses |
4,782 |
8,660 |
149 |
3,683 |
7,589 |
|||||||||||
|
Noninterest income:
|
||||||||||||||||
|
Fees for other services to customers
|
370
|
710
|
14
|
331
|
698
|
|||||||||||
|
Net securities gains
|
433
|
380
|
0
|
5
|
17
|
|||||||||||
|
Gain on sales of residential loans
|
770
|
1,426
|
49
|
919
|
1,867
|
|||||||||||
|
Gain on sale of commercial loan
|
203
|
203
|
0
|
0
|
0
|
|||||||||||
|
Investment commissions
|
704
|
1,391
|
25
|
625
|
1,174
|
|||||||||||
|
Bank owned life insurance income
|
126
|
253
|
4
|
123
|
250
|
|||||||||||
|
Bargain purchase gain
|
0
|
0
|
14,921
|
0
|
0
|
|||||||||||
|
Other income
|
86
|
107
|
7
|
153
|
225
|
|||||||||||
|
Total noninterest income
|
2,692
|
4,470
|
15,020
|
2,156
|
4,231
|
|||||||||||
|
Noninterest expense:
|
||||||||||||||||
|
Salaries and employee benefits
|
3,729
|
7,446
|
139
|
2,493
|
4,949
|
|||||||||||
|
Occupancy and equipment expense
|
916
|
1,765
|
23
|
674
|
1,352
|
|||||||||||
|
Professional fees
|
277
|
692
|
10
|
239
|
509
|
|||||||||||
|
Data processing fees
|
289
|
563
|
8
|
273
|
521
|
|||||||||||
|
Marketing expense
|
254
|
345
|
4
|
123
|
230
|
|||||||||||
|
FDIC insurance premiums
|
122
|
239
|
5
|
170
|
346
|
|||||||||||
|
Intangible asset amortization
|
337
|
673
|
0
|
0
|
0
|
|||||||||||
|
Merger expense
|
0
|
0
|
3,050
|
23
|
94
|
|||||||||||
|
Other
|
953
|
1,807
|
103
|
751
|
1,454
|
|||||||||||
|
Total noninterest expense
|
6,877
|
13,530
|
3,342
|
4,746
|
9,455
|
|||||||||||
|
Income (loss) from continuing operations before income
tax expense (benefit) |
597 |
(400) |
11,827 |
1,093 |
2,365 |
|||||||||||
|
Income tax expense (benefit)
|
179
|
(224)
|
(14)
|
310
|
698
|
|||||||||||
|
Net income (loss) from continuing operations
|
$
|
418
|
$
|
(176)
|
$
|
11,841
|
$
|
783
|
$
|
1,667
|
||||||
|
NORTHEAST BANCORP AND SUBSIDIARY
|
||||||||||||||||
|
CONSOLIDATED STATEMENTS OF INCOME
|
||||||||||||||||
|
(Unaudited)
|
||||||||||||||||
|
(Dollars in thousands, except per share data)
|
||||||||||||||||
|
(Continued)
|
||||||||||||||||
|
Successor Company (1)
|
Predecessor Company (2)
|
|||||||||||||||
| Three Months Ended |
Six Months Ended
|
Three Days Ended
|
89 Days Ended
|
181 Days Ended
|
||||||||||||
|
December 31, 2011
|
December 31, 2011
|
December 31, 2010
|
December 28, 2010
|
December 28, 2010
|
||||||||||||
|
Discontinued operations:
|
||||||||||||||||
|
Income (loss) from discontinued operations
|
$
|
0
|
$
|
186
|
$
|
(10)
|
$
|
(23)
|
$
|
94
|
||||||
|
Gain on sale of discontinued operations
|
0
|
1,529
|
0
|
105
|
105
|
|||||||||||
|
Income tax expense (benefit)
|
0
|
592
|
(4)
|
29
|
70
|
|||||||||||
|
Net income (loss) from discontinued operations
|
0
|
1,123
|
(6)
|
53
|
129
|
|||||||||||
|
Net income
|
$
|
418
|
$
|
947
|
$
|
11,835
|
$
|
836
|
$
|
1,796
|
||||||
|
Net income available to common stockholders
|
$
|
320
|
$
|
751
|
$
|
11,833
|
$
|
777
|
$
|
1,677
|
||||||
|
Weighted-average shares outstanding:
|
||||||||||||||||
|
Basic
|
3,494,498
|
3,494,498
|
3,492,498
|
2,331,332
|
2,330,197
|
|||||||||||
|
Diluted
|
3,511,994
|
3,494,498
|
3,588,756
|
2,358,647
|
2,354,385
|
|||||||||||
|
Earnings per common share:
|
||||||||||||||||
|
Basic:
|
||||||||||||||||
|
Income (loss) from continuing operations
|
$
|
0.09
|
$
|
(0.11)
|
$
|
3.38
|
$
|
0.31
|
$
|
0.66
|
||||||
|
Income from discontinued operations
|
0.00
|
0.32
|
0.00
|
0.02
|
0.06
|
|||||||||||
|
Net income
|
$
|
0.09
|
$
|
0.21
|
$
|
3.38
|
$
|
0.33
|
$
|
0.72
|
||||||
|
Diluted:
|
||||||||||||||||
|
Income (loss) from continuing operations
|
$
|
0.09
|
$
|
(0.11)
|
$
|
3.29
|
$
|
0.31
|
$
|
0.65
|
||||||
|
Income from discontinued operations
|
0.00
|
0.32
|
0.00
|
0.02
|
0.06
|
|||||||||||
|
Net income
|
$
|
0.09
|
$
|
0.21
|
$
|
3.29
|
$
|
0.33
|
$
|
0.71
|
||||||
|
(1)
|
“Successor Company” means Northeast Bancorp and its subsidiary after the closing of the merger with FHB Formation LLC on December 29, 2010.
|
|
(2)
|
“Predecessor Company” means Northeast Bancorp and its subsidiary before the closing of the merger with FHB Formation LLC on December 29, 2010.
|
|
NORTHEAST BANCORP AND SUBSIDIARY
|
|
|
CONSOLIDATED AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS
|
|
|
(Unaudited)
|
|
|
(Dollars in thousands)
|
|
|
Successor Company (1)
|
|||||||||||||||
|
Three Months Ended December 31, 2011
|
Six Months Ended December 31, 2011
|
||||||||||||||
|
Average
|
Interest
|
Average
|
Average
|
Interest
|
Average
|
||||||||||
|
Daily
|
Income/
|
Yield/
|
Daily
|
Income/
|
Yield/
|
||||||||||
|
Balance
|
Expense
|
Rate
|
Balance
|
Expense
|
Rate
|
||||||||||
|
(Dollars in thousands)
|
|||||||||||||||
|
Assets:
|
|||||||||||||||
|
Interest-earning assets:
|
|||||||||||||||
|
Investment securities
|
$
|
139,051
|
$
|
541
|
1.54%
|
$
|
143,372
|
$
|
1,180
|
1.63%
|
|||||
|
Loans (2) (3)
|
340,172
|
5,874
|
6.85%
|
328,210
|
11,011
|
6.66%
|
|||||||||
|
Regulatory stock
|
5,761
|
21
|
1.45%
|
5,761
|
33
|
1.14%
|
|||||||||
|
Short-term investments (4)
|
67,455
|
36
|
0.21%
|
72,903
|
83
|
0.23%
|
|||||||||
|
Total interest-earning assets
|
552,439
|
6,472
|
4.65%
|
550,246
|
12,307
|
4.44%
|
|||||||||
|
Non-interest earning assets:
|
|||||||||||||||
|
Cash & due from banks
|
2,981
|
2,950
|
|||||||||||||
|
Bank premises and equipment, net
|
8,924
|
8,598
|
|||||||||||||
|
Other assets
|
28,941
|
29,963
|
|||||||||||||
|
Allowance for loan losses
|
(743)
|
(596)
|
|||||||||||||
|
Total non-interest earning assets
|
40,103
|
40,915
|
|||||||||||||
|
Total assets
|
$
|
592,542
|
$
|
591,161
|
|||||||||||
|
Liabilities & Stockholders' Equity:
|
|||||||||||||||
|
Interest-bearing liabilities:
|
|||||||||||||||
|
NOW
|
$
|
54,806
|
$
|
54
|
0.39%
|
$
|
55,494
|
$
|
123
|
0.44%
|
|||||
|
Money market
|
44,247
|
42
|
0.38%
|
45,114
|
92
|
0.40%
|
|||||||||
|
Savings
|
32,360
|
18
|
0.22%
|
32,899
|
44
|
0.27%
|
|||||||||
|
Time
|
220,670
|
722
|
1.30%
|
218,133
|
1,414
|
1.29%
|
|||||||||
|
Total interest-bearing deposits
|
352,083
|
836
|
0.94%
|
351,640
|
1,673
|
0.94%
|
|||||||||
|
Short-term borrowings (5)
|
631
|
3
|
1.89%
|
886
|
8
|
1.79%
|
|||||||||
|
Borrowed funds
|
113,100
|
532
|
1.87%
|
113,423
|
1,064
|
1.86%
|
|||||||||
|
Junior subordinated debentures
|
8,009
|
185
|
9.16%
|
7,990
|
368
|
9.14%
|
|||||||||
|
Total interest-bearing liabilities
|
473,823
|
1,556
|
1.30%
|
473,939
|
3,113
|
1.30%
|
|||||||||
|
Interest-bearing liabilities of discontinued operations (6)
|
0
|
570
|
|||||||||||||
|
Non-interest bearing liabilities:
|
|||||||||||||||
|
Demand deposits and escrow accounts
|
47,290
|
46,524
|
|||||||||||||
|
Other liabilities
|
5,723
|
4,498
|
|||||||||||||
|
Total liabilities
|
526,836
|
525,531
|
|||||||||||||
|
Stockholders' equity
|
65,706
|
65,630
|
|||||||||||||
|
Total liabilities and stockholders' equity
|
$
|
592,542
|
$
|
591,161
|
|||||||||||
|
Net interest income
|
$
|
4,916
|
$
|
9,194
|
|||||||||||
|
Interest rate spread
|
3.35%
|
3.14%
|
|||||||||||||
|
Net interest margin (7)
|
3.53%
|
3.31%
|
|||||||||||||
|
(1)
|
"Successor Company" means Northeast Bancorp and its subsidiary after the closing of the merger with FHB Formation LLC on December 29, 2010.
|
|
(2)
|
Non-accruing loans are included in the computation of average balances, but unpaid interest on nonperforming loans has not been included for purposes of determining interest income.
|
|
(3)
|
Includes Loans held for sale
|
|
(4)
|
Short term investments include FHLB overnight deposits and other interest-bearing deposits.
|
|
(5)
|
Short-term borrowings include securities sold under repurchase agreements and sweep accounts.
|
|
(6)
|
The average balance of borrowings associated with discontinued operations has been excluded from interest expense, interest rate spread, and net interest margin.
|
|
(7)
|
Net interest margin is calculated as net interest income divided by total interest-earning assets.
|
|
NORTHEAST BANCORP AND SUBSIDIARY
|
|
|
CONSOLIDATED AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS
|
|
|
(Unaudited)
|
|
|
(Dollars in thousands)
|
|
|
Predecessor Company (1)
|
|||||||||||||||
|
89 days ended December 28, 2010
|
181 days ended December 28, 2010
|
||||||||||||||
|
Average
|
Interest
|
Average
|
Average
|
Interest
|
Average
|
||||||||||
|
Daily
|
Income/
|
Yield/
|
Daily
|
Income/
|
Yield/
|
||||||||||
|
Balance
|
Expense
|
Rate
|
Balance
|
Expense
|
Rate
|
||||||||||
|
Assets:
|
|||||||||||||||
|
Interest-earning assets:
|
|||||||||||||||
|
Investment securities
|
$
|
160,332
|
$
|
1,439
|
3.68%
|
$
|
161,894
|
$
|
3,111
|
3.88%
|
|||||
|
Loans (2)(3)
|
381,076
|
5,468
|
5.88%
|
385,286
|
11,210
|
5.87%
|
|||||||||
|
Regulatory stock
|
5,486
|
9
|
0.67%
|
5,486
|
18
|
0.66%
|
|||||||||
|
Short-term investments (4)
|
49,403
|
28
|
0.23%
|
39,212
|
39
|
0.20%
|
|||||||||
|
Total interest-earning assets
|
596,297
|
6,944
|
4.78%
|
591,878
|
14,378
|
4.90%
|
|||||||||
|
Non-interest earning assets:
|
|||||||||||||||
|
Cash & due from banks
|
|||||||||||||||
|
Bank premises and equipment, net
|
3,347
|
3,340
|
|||||||||||||
|
Other assets
|
7,983
|
8,006
|
|||||||||||||
|
Allowance for loan losses
|
32,377
|
32,620
|
|||||||||||||
|
Total non-interest earning assets
|
(5,915)
|
(5,902)
|
|||||||||||||
|
Total assets
|
37,792
|
38,064
|
|||||||||||||
|
$
|
634,089
|
$
|
629,942
|
||||||||||||
|
Liabilities & Stockholders' Equity:
|
|||||||||||||||
|
Interest-bearing liabilities:
|
|||||||||||||||
|
NOW
|
$
|
55,147
|
$
|
85
|
0.63%
|
$
|
53,780
|
$
|
183
|
0.69%
|
|||||
|
Money market
|
55,645
|
88
|
0.65%
|
55,955
|
212
|
0.76%
|
|||||||||
|
Savings
|
38,234
|
42
|
0.45%
|
38,303
|
99
|
0.52%
|
|||||||||
|
Time
|
190,650
|
1,058
|
2.28%
|
196,318
|
2,302
|
2.36%
|
|||||||||
|
Total interest-bearing deposits
|
339,676
|
1,273
|
1.54%
|
344,356
|
2,796
|
1.64%
|
|||||||||
|
Short-term borrowings (5)
|
61,364
|
205
|
1.37%
|
53,873
|
376
|
1.41%
|
|||||||||
|
Borrowed funds
|
117,668
|
1,163
|
4.05%
|
117,688
|
2,365
|
4.05%
|
|||||||||
|
Junior subordinated debentures
|
16,496
|
167
|
4.15%
|
16,496
|
340
|
4.16%
|
|||||||||
|
Total interest-bearing liabilities
|
535,204
|
2,808
|
2.15%
|
532,413
|
5,877
|
2.23%
|
|||||||||
|
Interest-bearing liabilities of discontinued operations (6)
|
2,351
|
2,462
|
|||||||||||||
|
Non-interest bearing liabilities:
|
|||||||||||||||
|
Demand deposits and escrow accounts
|
39,252
|
37,941
|
|||||||||||||
|
Other liabilities
|
5,711
|
5,576
|
|||||||||||||
|
Total liabilities
|
582,518
|
578,392
|
|||||||||||||
|
Stockholders' equity
|
51,571
|
51,550
|
|||||||||||||
|
Total liabilities and stockholders' equity
|
$
|
634,089
|
$
|
629,942
|
|||||||||||
|
Net interest income
|
$
|
4,136
|
$
|
8,501
|
|||||||||||
|
Interest rate spread
|
2.63%
|
2.67%
|
|||||||||||||
|
Net interest margin (7)
|
2.84%
|
2.90%
|
|||||||||||||
|
(1)
|
"Predecessor Company" means Northeast Bancorp and its subsidiary prior to the closing of the merger with FHB Formation LLC on December 29, 2010.
|
|
(2)
|
Non-accruing loans are included in the computation of average balances, but unpaid interest on nonperforming loans has not been included for purposes of determining interest income.
|
|
(3)
|
Includes Loans Held-for-Sale
|
|
(4)
|
Short term investments include FHLB overnight deposits and other interest-bearing deposits.
|
|
(5)
|
Short-term borrowings include securities sold under repurchase agreements and sweep accounts.
|
|
(6)
|
The average balance of borrowings associated with discontinued operations has been excluded from interest expense, interest rate spread, and net interest margin.
|
| (7) | Net interest margin is calculated as net interest income divided by total interest-earning assets. |
|
NORTHEAST BANCORP AND SUBSIDIARY
|
|||||||
|
SELECTED CONSOLIDATED FINANCIAL HIGHLIGHTS AND OTHER DATA
|
|||||||
|
(Unaudited)
|
|||||||
|
(Dollars in thousands, except share and per share data)
|
|||||||
|
Successor Company (1)
|
|||||||
|
Three Months
|
Six Months
|
||||||
|
Ended
|
Ended
|
||||||
|
December 31, 2011
|
December 31, 2011
|
||||||
|
Net interest income
|
$ 4,916
|
$ 9,194
|
|||||
|
Net income
|
$ 418
|
$ 947
|
|||||
|
Weighted average shares outstanding:
|
|||||||
|
Basic
|
3,494,498
|
3,494,498
|
|||||
|
Diluted
|
3,511,994
|
3,494,498
|
|||||
|
Earnings per share:
|
|||||||
|
Basic
|
$ 0.09
|
$ 0.21
|
|||||
|
Diluted
|
$ 0.09
|
$ 0.21
|
|||||
|
Return on average assets
|
0.28%
|
0.32%
|
|||||
|
Return on average equity
|
2.52%
|
2.86%
|
|||||
|
Net interest rate spread (4)
|
3.35%
|
3.14%
|
|||||
|
Net interest margin (5)
|
3.53%
|
3.31%
|
|||||
|
Efficiency ratio (6)
|
90.39%
|
99.02%
|
|||||
|
Non-interest expense to average total assets
|
4.60%
|
4.54%
|
|||||
|
Average interest-earning assets to average interest-bearing liabilities
|
116.59%
|
116.10%
|
|||||
|
Successor Company (1)
|
|||||||
|
Non-performing loans:
|
December 31, 2011
|
September 30, 2011
|
June 30, 2011
|
||||
|
Originated portfolio:
|
|||||||
|
Residential
|
$ 3,264
|
$ 2,733
|
$ 2,195
|
||||
|
Commercial
|
1,998
|
2,797
|
3,601
|
||||
|
Construction
|
0
|
121
|
121
|
||||
|
Home equity
|
182
|
205
|
205
|
||||
|
Commercial business
|
1,119
|
1,224
|
559
|
||||
|
Consumer
|
329
|
356
|
527
|
||||
|
6,892
|
7,436
|
7,208
|
|||||
|
Purchased portfolio:
|
|||||||
|
Residential
|
0
|
0
|
0
|
||||
|
Commercial
|
0
|
0
|
0
|
||||
|
Commercial business
|
0
|
0
|
0
|
||||
|
0
|
0
|
0
|
|||||
|
Total non-performing loans
|
6,892
|
7,436
|
7,208
|
||||
|
Repossessed collateral
|
837
|
463
|
690
|
||||
|
Total non-performing assets
|
$ 7,729
|
$ 7,899
|
$ 7,898
|
||||
|
Ratio of nonperforming loans to total loans
|
1.99%
|
2.35%
|
2.33%
|
||||
|
Ratio of nonperforming assets to total assets
|
1.30%
|
1.35%
|
1.32%
|
||||
|
Allowance for loan losses to total loans
|
0.21%
|
0.22%
|
0.14%
|
||||
|
Allowance for loan losses to nonperforming loans
|
10.69%
|
9.55%
|
6.06%
|
||||
|
Commercial real estate loans to risk-based capital
|
236.88%
|
194.08%
|
200.53%
|
||||
|
Net loans to core deposits (2)
|
91.34%
|
84.75%
|
84.46%
|
||||
|
Purchased loans to total loans
|
14.83%
|
3.90%
|
0.21%
|
||||
|
Equity to total assets
|
11.08%
|
11.27%
|
10.89%
|
||||
|
Tier 1 leverage capital ratio
|
11.86%
|
11.85%
|
10.35%
|
||||
|
Total risk-based capital ratio
|
19.28%
|
20.93%
|
18.99%
|
||||
|
Number of full service branches
|
10
|
10
|
10
|
||||
|
Number of investment and mortgage loan origination offices
|
7
|
7
|
7
|
||||
|
Stockholders' equity
|
$ 65,900
|
$ 66,188
|
$ 64,954
|
||||
|
Book value per share
|
$ 17.58
|
$ 17.66
|
$ 17.33
|
||||
|
Tangible book value per share (3)
|
$ 16.15
|
$ 16.14
|
$ 13.58
|
||||
|
(1)
|
"Successor Company" means Northeast Bancorp and its subsidiary after the closing of the merger with FHB Formation LLC on December 29, 2010.
|
||||||
|
(2)
|
Core deposits includes all non-maturity deposits and maturity deposits less than $250 thousand. Net loans includes loans held-for-sale.
|
||||||
|
(3)
|
Reconciliation of Non-GAAP Ratio:
|
||||||
|
Per Common
|
|||||||
|
Equity
|
Share
|
||||||
|
Total Stockholders' Equity
|
$ 65,900
|
||||||
|
Less Preferred Stock
|
4,227
|
||||||
|
Total Common Equity
|
$ 61,673
|
$ 17.58
|
|||||
|
Less Core Deposit Intangible
|
5,012
|
1.43
|
|||||
|
Tangible Common Equity
|
$ 56,661
|
$ 16.15
|
|||||
|
Outstanding Common Shares
|
3,507,524
|
||||||
|
(4)
|
The net interest rate spread represents the difference between the weighted-average yield on interest-earning assets and the weighted-average
|
||||||
|
cost of interest-bearing liabilities for the period.
|
|||||||
|
(5)
|
The net interest margin represents net interest income as a percent of average interest-earning assets for the period.
|
||||||
|
(6)
|
The efficiency ratio represents non-interest expense divided by the sum of net interest income (before the loan loss provision) plus non-interest income.
|
||||||