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): October
20,
2008
NORTHEAST
BANCORP
(Exact
Name of Registrant as Specified in its Charter)
|
Maine
|
1-14588
|
01-0425066
|
|
(State
or Other Jurisdiction Incorporation)
|
(Commission
File Number)
|
(IRS
Employer Identification Number)
|
|
500
Canal Street, Lewiston,
Maine
|
04240
|
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
|
Registrant's
telephone number, including area code:
|
(207)
786-3245
|
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.
|
o
|
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425).
|
|
o
|
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12).
|
|
o
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)).
|
|
o
|
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240. Rule 13e-4(c)).
|
|
Item
9.01
|
Financial
Statements and Exhibits.
|
|
(c)
|
Exhibits.
|
|
Exhibit
No.
|
Description
|
|
99.1
|
Press
Release, dated October 20, 2008 regarding first quarter 2009 earnings and
the declaration of a dividend.
|
Item
7.01 Regulation FD Disclosure.
On
October 20, 2008, Northeast Bancorp, a Maine corporation (the "Company"), issued
a press release announcing its earnings for the first quarter ended September
30, 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 first quarter ended September 30, 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.
|
NORTHEAST
BANCORP
|
||
|
Date: October
21, 2008
|
By:
|
/s/ James D.
Delamater
|
|
James D. Delamater
|
||
|
President and Chief Executive
Officer
|
EXHIBIT
INDEX
|
Exhibit
No.
|
Description
|
|
99.1
|
Press
Release, dated October 20, 2008 regarding first 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 1st Quarter
Earnings and
Approves
2009 Dividend Plan
Lewiston,
MAINE (October 20, 2008)
- - Northeast Bancorp (NASDAQ: NBN), the parent company of Northeast Bank
(www.northeastbank.com), reported earnings for the quarter ended September 30,
2008 of $69,116, or $0.03 per diluted share, as compared to earnings for the
same period last year of $430,565, or $0.18 per diluted share. The decline in
earnings was the result of a higher provision for loan losses and one-time
charges related to the realized losses and impairment expense of various common
and preferred stock investments of $391,000 that were negatively affected by
recent market events. Excluding the impact of common and preferred stock
realized losses and impairment expenses, earnings were $324,500, or $0.14 per
diluted share, a 25% decline over the same quarter last year.
James
Delamater, Northeast Bancorp President and CEO, commented: “As part of our
ongoing comprehensive risk management program, we have scrubbed our portfolio
and believe that we have properly identified any problem investments. After
putting this one-time charge behind us, we intend to continue to develop our
business plan of pursuing a high level of product and income
diversity.”
For the
first quarter 2009, total net interest income and noninterest income increased
by 18%, to $6,601,854, up from $5,582,221. Noninterest income levels increased
to $2,560,647 for the quarter ended September 30, 2008 as compared to $1,989,374
for the same period in 2007, an increase of 29%, with insurance and investment
revenues increasing by 75% and 6%, respectively. Net interest income increased
12% to $4,401,207 primarily due to a 17 basis point increase in net interest
margin to 2.92% as compared to the same period one year ago.
Mr.
Delamater commented further; “Our strategy, calling for the full diversification
of our revenue streams, continues to serve us well. Revenues from the operations
of the Company’s insurance and investment divisions exceeded our expectations
this past quarter. We are encouraged as we continue to grow, improve our margins
and focus on the right products and markets, especially as we are seeing
substantial progress in the delivery of property & casualty insurance to our
customers, the result of our aggressive agency acquisition
strategy.”
As of
September 30, 2008, Northeast Bancorp had total assets of approximately $605
million. Loans decreased $12.5 million compared to September 30, 2007; primarily
resulting from a $9.1 million decrease in commercial loans. In addition, the
allowance for loan losses as a percentage of total loans was 1.38% at September
30, 2008 as compared to 1.37% for the same period one year ago.
“Our risk
management program, adopted some time ago, called for the full analysis and
rating of our loan portfolio. Therefore, we believe that we have properly
measured our credit risk and that our allowance for loan losses is adequate. We
are pleased to see growth in mortgages and consumer loans, and anticipate an
increase in fee income related to the origination and sale of mortgages into the
secondary market as more customers return to ‘community banks’ where they will
find a better understanding of the need for quality advice,” said
Delamater.
The
Company continued to reduce its reliance on brokered deposits to fund asset
growth, with brokered deposits declining by $6.2 million since September 2007.
Over the past year, deposits declined by $4.4 million as the decline in brokered
deposits was partially offset by an increase in core deposits, primarily money
market accounts, of $1.8 million.
“With the
recent changes to the FDIC deposit insurance levels from $100,000 to $250,000,
we’re anticipating a further increase in core deposits as customers look for
safe places to invest and save. We are taking this opportunity to bolster our
liquidity levels so as to position the Company to take advantage of quality
lending opportunities,” noted Delamater.
In
addition to announcing earnings, the Board of Directors declared a dividend of
$0.09 per share payable on November 21, 2008 to shareholders of record as of the
close of business on October 31, 2008. The board approved a dividend payout plan
of quarterly cash dividends at this level for fiscal year 2009; this plan is
subject to exceeding the regulatory definition of well-capitalized.
“Community
banks are vital to local economies and to helping families and businesses
weather this current financial situation. Northeast Bancorp is fortunate to have
investors and shareholders who have embraced our long-term strategy for product
and income diversification and understand the importance of a more conservative
approach to pricing and lending; a plan that the Board of Directors and
Management executed three years ago. And, for that reason, we are pleased to
continue to pay a quarterly dividend, as we have since our
inception.”
Northeast
Bancorp common shares trade on the NASDAQ with
approximately 2.3 million shares outstanding and, as of September 30, 2008, had
a book value of $17.80 per share, an increase from $17.14 at the end of the
same period last year.
“We have
taken a number of steps to protect our investors, customers and other
stakeholders from the risks impacting the financial services industry, including
full product and income diversification, conservative lending and prudent
oversight. We have a strong capital position, adequate liquidity, good products,
growing revenues, strong risk management discipline and multiple revenue streams
with a high level of product and income diversity. As a result, we believe the
Company is in a solid position for continued growth,” Delamater
said.
Northeast
Bancorp, headquartered at 500 Canal Street, Lewiston, ME 04240, is the holding
company for the Maine-based Northeast Bank, founded in 1872. Northeast Bank,
together with its wholly-owned subsidiary, Northeast Bank Insurance Group, Inc.,
operates 25 retail and insurance locations and derives its income from a
combination of traditional banking services and non-traditional financial
products and services including insurance and investments.
Management
encourages present and prospective shareholders to contact President and CEO Jim
Delamater directly to discuss the Company, its products and services, and
ongoing efforts to develop shareholder value. He can be reached at
jdelamater@northeastbank.com or toll free at 1-800-284-5989. Management also
suggests that any person wishing to utilize the services of Northeast Bancorp or
its subsidiaries or interested in learning more about the Company can access its
web site at www.northeastbank.com.
---------------------------------------------------------------------------------------------------------------------
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.
|
NORTHEAST
BANCORP
|
||||||||||||
|
(Dollars
in Thousands, Except Per Share and Shares Outstanding
Data)
|
||||||||||||
|
(Unaudited)
|
||||||||||||
|
Three
Months Ended
|
||||||||||||
|
September
30,
|
%
|
|||||||||||
|
2008
|
2007
|
Change
|
||||||||||
|
Selected
financial information
|
||||||||||||
|
Income
statement data:
|
||||||||||||
|
Interest
income
|
$ | 8,595 | $ | 8,957 | -4 | % | ||||||
|
Interest
expense
|
4,554 | 5,364 | -15 | % | ||||||||
|
Net
interest income
|
4,041 | 3,593 | 12 | % | ||||||||
|
Provision
for loan losses
|
521 | 190 | 174 | % | ||||||||
|
Net
interest income afterprovision for loan losses
|
3,520 | 3,403 | 3 | % | ||||||||
|
Gain
on sale of loans
|
111 | 153 | -27 | % | ||||||||
|
Loss
on securities sales
|
(108 | ) | (6 | ) | 1700 | % | ||||||
|
Investment
brokerage income
|
421 | 398 | 6 | % | ||||||||
|
Insurance
agency income
|
1,517 | 866 | 75 | % | ||||||||
|
Other
noninterest income
|
620 | 578 | 7 | % | ||||||||
|
Noninterest
Income
|
2,561 | 1,989 | 29 | % | ||||||||
|
Noninterest
expense
|
6,089 | 4,842 | 26 | % | ||||||||
|
Operating
(loss) income before income tax
|
(8 | ) | 550 | -101 | % | |||||||
|
Income
tax (benefit) expense
|
(77 | ) | 119 | -165 | % | |||||||
|
Net
income
|
$ | 69 | $ | 431 | -84 | % | ||||||
|
Per
share data:
|
||||||||||||
|
Basic
earning per common share
|
$ | 0.03 | $ | 0.18 | -83 | % | ||||||
|
Diluted
earnings per common share
|
$ | 0.03 | $ | 0.18 | -83 | % | ||||||
|
Weighted
average shares outstanding:
|
||||||||||||
|
Basic
|
2,315,443 | 2,415,952 | -4 | % | ||||||||
|
Diluted
|
2,324,916 | 2,432,977 | -4 | % | ||||||||
|
Book
value per share
|
$ | 17.80 | $ | 17.14 | ||||||||
|
Tangible
book value per share
|
$ | 12.36 | $ | 13.66 | ||||||||
|
Net
interest margin
|
2.92 | % | 2.75 | % | ||||||||
|
Net
interest spread
|
2.69 | % | 2.42 | % | ||||||||
|
Return
on average assets (annualized)
|
0.05 | % | 0.31 | % | ||||||||
|
Return
on equity (annualized)
|
0.68 | % | 4.17 | % | ||||||||
|
Tier
I leverage ratio (Bank)
|
6.92 | % | 8.11 | % | ||||||||
|
Tier
I risk-based capital ratio (Bank)
|
9.62 | % | 10.84 | % | ||||||||
|
Total
risk-based capital ratio (Bank)
|
10.97 | % | 12.09 | % | ||||||||
|
Efficiency
ratio
|
92 | % | 87 | % | ||||||||
|
Nonperforming
loans
|
6,561 | 4,737 | ||||||||||
|
Total
nonperforming assets
|
7,040 | 4,737 | ||||||||||
|
Nonperforming
loans as a % of total loans
|
1.61 | % | 1.12 | % | ||||||||
|
Nonperforming
assets as a % of total assets
|
1.16 | % | 0.83 | % | ||||||||
|
September
30,
|
%
|
|||||||||||
|
2008
|
2007
|
Change
|
||||||||||
|
Balance
sheet highlights:
|
||||||||||||
|
Available-for-sale
securities, at fair value
|
$ | 143,445 | $ | 109,526 | 31 | % | ||||||
|
Loans
held for sale
|
1,046 | 830 | 26 | % | ||||||||
|
Loans
|
408,759 | 421,290 | -3 | % | ||||||||
|
Allowance
for loan losses
|
5,656 | 5,756 | -2 | % | ||||||||
|
Goodwill
& intangibles
|
12,640 | 8,254 | 53 | % | ||||||||
|
Total
assets
|
605,170 | 573,680 | 5 | % | ||||||||
|
Deposits:
|
||||||||||||
|
NOW
and money market
|
69,696 | 63,597 | 10 | % | ||||||||
|
Savings
|
20,123 | 21,519 | -6 | % | ||||||||
|
Certificates
of deposits
|
216,291 | 222,478 | -3 | % | ||||||||
|
Brokered
time deposits
|
12,603 | 18,861 | -33 | % | ||||||||
|
Noninterest-bearing
deposits
|
37,879 | 34,558 | 10 | % | ||||||||
|
Total
deposits
|
356,592 | 361,013 | -1 | % | ||||||||
|
Borrowings
|
204,393 | 169,242 | 21 | % | ||||||||
|
Shareholders'
equity
|
41,324 | 40,641 | 2 | % | ||||||||
|
Shares
outstanding
|
2,321,182 | 2,371,332 | -2 | % | ||||||||