For
the quarterly period ended
|
September
30, 2007
|
Commission
File Number
|
1-14588
|
Maine
_____________________________________________
|
01-0425066
____________________________________
|
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification No.)
|
500
Canal Street, Lewiston, Maine
___________________________________
|
04240
____________________________________
|
(Address
of Principal executive offices)
|
(Zip
Code)
|
Part
I.
|
Financial
Information
|
|
|
Item
1.
|
Consolidated
Financial Statements
|
|
|
|
|
|
Consolidated
Balance Sheets
September
30, 2007 (Unaudited) and June 30, 2007
|
|
|
|
|
|
Consolidated
Statements of Income (Unaudited)
Three
Months Ended September 30, 2007 and 2006
|
|
|
|
|
|
Consolidated
Statements of Changes in Stockholders' Equity (Unaudited)
Three
Months Ended September 30, 2007 and 2006
|
|
|
|
|
|
Consolidated
Statements of Cash Flows (Unaudited)
Three
Months ended September 30, 2007 and 2006
|
|
|
|
|
|
Notes
to Consolidated Financial Statements (Unaudited)
|
|
|
|
|
Item
2.
|
Management's
Discussion and Analysis of Results of Operations and
Financial
Condition
|
|
|
|
|
Item
3.
|
Quantitative
and Qualitative Disclosure about Market Risk
|
|
|
|
|
Item
4.
|
Controls
and Procedures
|
|
|
|
Part
II.
|
Other
Information
|
|
|
|
|
|
Item
1.
|
Legal
Proceedings
|
|
|
|
|
Item
1.a.
|
Risk
Factors
|
|
|
|
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
|
|
|
|
Item
3.
|
Defaults
Upon Senior Securities
|
|
|
|
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
|
|
|
|
Item
5.
|
Other
Information
|
|
|
|
|
Item
6.
|
Exhibits
|
PART
1 - FINANCIAL INFORMATION
|
|
|||||||
|
|
|
|
|
|
|
||
Item
1. Financial Statements
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
NORTHEAST
BANCORP AND SUBSIDIARY
|
|
|||||||
Consolidated
Balance Sheets
|
|
|||||||
|
|
|||||||
|
|
|
|
|
|
|
||
|
|
September
30,
|
|
|
|
|
||
2007
|
June
30,
|
|||||||
|
|
(Unaudited)
|
|
|
2007
|
|
||
Assets
|
|
|
|
|
|
|
||
Cash
and due from banks
|
|
$
|
7,353,302
|
|
|
$
|
9,065,330
|
|
Interest-bearing
deposits
|
|
|
1,562,126
|
|
|
|
1,676,391
|
|
Total
cash and cash equivalents
|
|
|
8,915,428
|
|
|
|
10,741,721
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale
securities, at fair value
|
|
|
109,525,834
|
|
|
|
86,348,070
|
|
Loans
held-for-sale
|
|
|
829,610
|
|
|
|
1,636,485
|
|
|
|
|
|
|
|
|
|
|
Loans
receivable
|
|
|
421,289,576
|
|
|
|
425,571,418
|
|
Less
allowance for loan losses
|
|
|
5,756,000
|
|
|
|
5,756,000
|
|
Net
loans
|
|
|
415,533,576
|
|
|
|
419,815,418
|
|
|
|
|
|
|
|
|
|
|
Premises
and equipment, net
|
|
|
7,388,998
|
|
|
|
7,545,430
|
|
Accrued
interest receivable
|
|
|
2,590,134
|
|
|
|
2,586,720
|
|
Federal
Home Loan Bank stock, at cost
|
|
|
4,825,700
|
|
|
|
4,825,700
|
|
Federal
Reserve Bank stock, at cost
|
|
|
471,500
|
|
|
|
471,500
|
|
Goodwill
|
|
|
3,467,993
|
|
|
|
2,880,803
|
|
Intangible
assets, net of accumulated amortization of $2,784,685
at 09/30/07 and
$2,681,148 at 6/30/07
|
|
|
4,785,544
|
|
|
|
4,110,081
|
|
Bank
owned life insurance (BOLI)
|
|
|
9,946,784
|
|
|
|
9,844,584
|
|
Other
assets
|
|
|
5,398,590
|
|
|
|
5,994,468
|
|
Total
assets
|
|
$
|
573,679,691
|
|
|
$
|
556,800,980
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
and Stockholders' Equity
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
|
|
Demand
|
|
$
|
34,557,846
|
|
|
$
|
36,332,604
|
|
NOW
|
|
|
55,167,710
|
|
|
|
53,405,241
|
|
Money
market
|
|
|
8,429,069
|
|
|
|
8,053,552
|
|
Regular
savings
|
|
|
21,518,956
|
|
|
|
21,145,567
|
|
Brokered
time deposits
|
|
|
18,860,960
|
|
|
|
22,546,163
|
|
Certificates
of deposit
|
|
|
222,478,254
|
|
|
|
223,070,650
|
|
Total
deposits
|
|
|
361,012,795
|
|
|
|
364,553,777
|
|
|
|
|
|
|
|
|
|
|
Federal
Home Loan Bank advances
|
|
|
85,240,181
|
|
|
|
93,016,698
|
|
Structured
repurchase agreements
|
|
|
30,000,000
|
|
|
|
-
|
|
Short-term
borrowings
|
|
|
31,685,285
|
|
|
|
33,105,377
|
|
Junior
subordinated debentures issued to affiliated trusts
|
|
|
16,496,000
|
|
|
|
16,496,000
|
|
Capital
lease obligation
|
|
|
2,620,886
|
|
|
|
2,653,511
|
|
Other
borrowings
|
|
|
3,200,057
|
|
|
|
2,292,163
|
|
Other
liabilities
|
|
|
2,783,353
|
|
|
|
3,833,576
|
|
Total
liabilities
|
|
|
533,038,557
|
|
|
|
515,951,102
|
|
|
|
|
|
|
|
|
|
|
Commitments
and contingent liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity
|
|
|
|
|
|
|
|
|
Preferred
stock, $1.00 par value, 1,000,000 shares authorized;
none
issued
|
|
|
-
|
|
|
|
-
|
|
Common
stock, at stated value, 15,000,000 shares authorized;
2,371,332 and
2,448,832 shares
|
|
|
|
|
|
|
|
|
outstanding
at September 30, 2007 and June 30, 2007, respectively
|
|
|
2,371,332
|
|
|
|
2,448,832
|
|
Additional
paid-in capital
|
|
|
3,409,539
|
|
|
|
4,715,164
|
|
Retained
earnings
|
|
|
35,810,257
|
|
|
|
35,600,428
|
|
Accumulated
other comprehensive loss
|
|
|
(949,994
|
)
|
|
|
(1,914,546
|
)
|
Total
stockholders' equity
|
|
|
40,641,134
|
|
|
|
40,849,878
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities and stockholders' equity
|
|
$
|
573,679,691
|
|
|
$
|
556,800,980
|
|
NORTHEAST
BANCORP AND SUBSIDIARY
|
|
|||||||
Consolidated
Statements of Income
|
|
|||||||
(Unaudited)
|
|
|||||||
|
|
|
|
|
|
|
||
|
|
Three
Months Ended
|
|
|||||
|
|
September
|
|
|||||
|
|
2007
|
|
|
2006
|
|
||
Interest
and dividend income:
|
|
|
|
|
|
|
||
Interest
on loans
|
|
$
|
7,723,178
|
|
|
$
|
7,942,105
|
|
Interest
on Federal Home Loan Bank overnight
deposits
|
|
|
10,909
|
|
|
|
19,494
|
|
Taxable
interest on available-for-sale securities
|
|
|
973,414
|
|
|
|
803,909
|
|
Tax-exempt
interest on available-for-sale securities
|
|
|
111,123
|
|
|
|
110,381
|
|
Dividends
on available-for-sale securities
|
|
|
32,779
|
|
|
|
33,661
|
|
Dividends
on Federal Home Loan Bank and Federal Reserve
Bank stock
|
|
|
85,283
|
|
|
|
100,429
|
|
Other
interest and dividend income
|
|
|
20,201
|
|
|
|
12,010
|
|
Total
interest and dividend income
|
|
|
8,956,887
|
|
|
|
9,021,989
|
|
|
|
|
|
|
|
|
|
|
Interest
expense:
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
3,414,576
|
|
|
|
3,350,654
|
|
Federal
Home Loan Bank advances
|
|
|
1,102,051
|
|
|
|
934,636
|
|
Short-term
borrowings
|
|
|
372,425
|
|
|
|
307,829
|
|
Junior
subordinated debentures issued to affiliated trusts
|
|
|
273,480
|
|
|
|
277,991
|
|
Structured
repurchase agreements
|
|
|
125,989
|
|
|
|
-
|
|
Obligation
under capital lease agreements
|
|
|
33,441
|
|
|
|
35,061
|
|
Other
borrowings
|
|
|
42,078
|
|
|
|
441
|
|
Total
interest expense
|
|
|
5,364,040
|
|
|
|
4,906,612
|
|
|
|
|
|
|
|
|
|
|
Net
interest and dividend income before provision for
loan
losses
|
|
|
3,592,847
|
|
|
|
4,115,377
|
|
|
|
|
|
|
|
|
|
|
Provision
for loan losses
|
|
|
190,283
|
|
|
|
300,786
|
|
Net
interest and dividend income after provision for loan
losses
|
|
|
3,402,564
|
|
|
|
3,814,591
|
|
|
|
|
|
|
|
|
|
|
Noninterest
income:
|
|
|
|
|
|
|
|
|
Fees
for other services to customers
|
|
|
273,613
|
|
|
|
266,808
|
|
Net
securities (losses) gains
|
|
|
(5,937
|
)
|
|
|
4,386
|
|
Gain
on sales of loans
|
|
|
152,956
|
|
|
|
95,785
|
|
Investment
commissions
|
|
|
398,010
|
|
|
|
371,608
|
|
Insurance
commissions
|
|
|
866,042
|
|
|
|
428,465
|
|
BOLI
income
|
|
|
111,766
|
|
|
|
97,044
|
|
Other income
|
|
|
192,924
|
|
|
|
198,332
|
|
Total
noninterest income
|
|
|
1,989,374
|
|
|
|
1,462,428
|
|
|
|
|
|
|
|
|
|
|
Noninterest
expense:
|
|
|
|
|
|
|
|
|
Salaries
and employee benefits
|
|
|
2,861,145
|
|
|
|
2,773,924
|
|
Occupancy
expense
|
|
|
411,007
|
|
|
|
411,349
|
|
Equipment
expense
|
|
|
379,380
|
|
|
|
398,369
|
|
Intangible
assets amortization
|
|
|
103,537
|
|
|
|
66,762
|
|
Other
|
|
|
1,086,535
|
|
|
|
1,019,274
|
|
Total
noninterest expense
|
|
|
4,841,604
|
|
|
|
4,669,678
|
|
|
|
|
|
|
|
|
|
|
Income
before income tax expense
|
|
|
550,334
|
|
|
|
607,341
|
|
Income
tax expense
|
|
|
119,769
|
|
|
|
152,674
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
|
430,565
|
|
|
$
|
454,667
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings
per common share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.18
|
|
|
$
|
0.19
|
|
Diluted
|
|
$
|
0.18
|
|
|
$
|
0.18
|
|
|
|
|
|
|
|
|
|
|
Net
interest margin (tax equivalent basis)
|
|
|
2.75
|
%
|
|
|
3.05
|
%
|
Net
interest spread (tax equivalent basis)
|
|
|
2.42
|
%
|
|
|
2.77
|
%
|
Return
on average assets (annualized)
|
|
|
0.31
|
%
|
|
|
0.32
|
%
|
Return
on average equity (annualized)
|
|
|
4.17
|
%
|
|
|
4.52
|
%
|
Efficiency
ratio
|
|
|
87
|
%
|
|
|
84
|
%
|
NORTHEAST
BANCORP AND SUBSIDIARY
|
||||||||||||||||||||||||
Consolidated
Statements of Changes in Stockholders' Equity
|
||||||||||||||||||||||||
Three
Months Ended September 30, 2007 and 2006
|
||||||||||||||||||||||||
(Unaudited)
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||||||
|
|
|
|
|
Accumulated
|
|
||||||||||||||||||
|
|
|
Additional
|
|
Other
|
|
||||||||||||||||||
|
Preferred
|
Common
|
Paid-in
|
Retained
|
Comprehensive
|
|
||||||||||||||||||
|
Stock
|
Stock
|
Capital
|
Earnings
|
Loss
|
Total
|
||||||||||||||||||
Balance
at June 30, 2006
|
$ |
-
|
$ |
2,447,132
|
$ |
4,675,258
|
$ |
34,596,204
|
$ | (2,622,469 | ) | $ |
39,096,125
|
|||||||||||
Net
income for three months ended 9/30/06
|
454,667
|
454,667
|
||||||||||||||||||||||
Other
comprehensive income net of tax:
|
||||||||||||||||||||||||
Net
unrealized losses on investments available
|
||||||||||||||||||||||||
for
sale, net of reclassification adjustment
|
1,170,126
|
1,170,126
|
||||||||||||||||||||||
Total
comprehensive income
|
1,624,793
|
|||||||||||||||||||||||
|
||||||||||||||||||||||||
Dividends
on common stock at $0.09 per share
|
(220,242 | ) | (220,242 | ) | ||||||||||||||||||||
Common
stock issued in connection with
|
||||||||||||||||||||||||
the
purchase of branch real estate
|
5,000
|
98,000
|
103,000
|
|||||||||||||||||||||
|
||||||||||||||||||||||||
Balance
at September 30, 2006
|
$ |
-
|
$ |
2,452,132
|
$ |
4,773,258
|
$ |
34,830,629
|
$ | (1,452,343 | ) | $ |
40,603,676
|
|||||||||||
|
||||||||||||||||||||||||
Balance
at June 30, 2007
|
$ |
-
|
$ |
2,448,832
|
$ |
4,715,164
|
$ |
35,600,428
|
$ | (1,914,546 | ) | $ |
40,849,878
|
|||||||||||
Net
income for three months ended 9/30/07
|
430,565
|
430,565
|
||||||||||||||||||||||
Other
comprehensive income net of tax:
|
||||||||||||||||||||||||
Net
unrealized losses on investments available
|
||||||||||||||||||||||||
for
sale, net of reclassification adjustment
|
964,552
|
964,552
|
||||||||||||||||||||||
Total
comprehensive income
|
1,395,117
|
|||||||||||||||||||||||
|
||||||||||||||||||||||||
Dividends
on common stock at $0.09 per share
|
(220,736 | ) | (220,736 | ) | ||||||||||||||||||||
Common
stock re-purchased
|
(77,500 | ) | (1,305,625 | ) | (1,383,125 | ) | ||||||||||||||||||
|
||||||||||||||||||||||||
Balance
at September 30, 2007
|
$ |
-
|
$ |
2,371,332
|
$ |
3,409,539
|
$ |
35,810,257
|
$ | (949,994 | ) | $ |
40,641,134
|
|
NORTHEAST
BANCORP AND SUBSIDIARY
|
|
|||||||
|
Consolidated
Statements of Cash Flows
|
|
|||||||
|
(Unaudited)
|
|
|||||||
|
|
|
|
|
|
|
|
||
|
|
|
Three
Months Ended
|
|
|||||
|
|
|
September
30,
|
|
|||||
|
|
|
2007
|
|
|
2006
|
|
||
Cash
(used) provided by operating activities:
|
|
$
|
(485,207
|
)
|
|
$
|
266,586
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
flows from investing activities:
|
|
|
|
|
|
|
|
|
|
Available-for-sale
securities purchased
|
|
|
(25,540,529
|
)
|
|
|
(3,133,932
|
)
|
|
Available-for-sale
securities matured
|
|
|
3,440,048
|
|
|
|
2,566,629
|
|
|
Available-for-sale
securities sold
|
|
|
395,695
|
|
|
|
266,573
|
|
|
Net
change in loans
|
|
|
4,366,136
|
|
|
|
(4,352,246
|
)
|
|
Net
capital expenditures
|
|
|
(111,003
|
)
|
|
|
(46,681
|
)
|
|
Cash
paid in connection with purchase of branch real
estate
|
|
|
-
|
|
|
|
(297,000
|
)
|
|
Cash
paid in connection with acquisition of insurance agency
|
|
|
(425,250
|
)
|
|
|
-
|
|
|
Net
cash used by investing activities
|
|
|
(17,874,903
|
)
|
|
|
(4,996,657
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Cash
flows from financing activities:
|
|
|
|
|
|
|
|
|
|
Net
change in deposits
|
|
|
(3,540,982
|
)
|
|
|
(5,006,450
|
)
|
|
Net
change in short-term borrowings
|
|
|
(1,420,092
|
)
|
|
|
9,301,032
|
|
|
Dividends
paid
|
|
|
(220,736
|
)
|
|
|
(220,242
|
)
|
|
Company
stock repurchased
|
|
|
(1,383,125
|
)
|
|
|
-
|
|
|
Advances
from the Federal Home Loan Bank
|
|
|
-
|
|
|
|
19,000,000
|
|
|
Repayment
of advances from the Federal Home Loan Bank
|
|
|
(8,211,517
|
)
|
|
|
(17,205,734
|
)
|
|
Net
advances on Federal Home Loan Bank overnight advances
|
|
|
435,000
|
|
|
|
-
|
|
|
Structured
repurchase agreements
|
|
|
30,000,000
|
|
|
|
-
|
|
|
Debt
from purchase of insurance agency
|
|
|
933,000
|
|
|
|
-
|
|
|
Repayment
on debt from insurance agencies acquisitions
|
|
|
(25,106
|
)
|
|
|
-
|
|
|
Repayment
on capital lease obligation
|
|
|
(32,625
|
)
|
|
|
(31,004
|
)
|
|
Net
cash provided by financing activities
|
|
|
16,533,817
|
|
|
|
5,837,602
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(decrease) increase in cash and cash equivalents
|
|
|
(1,826,293
|
)
|
|
|
1,107,531
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents, beginning of period
|
|
|
10,741,721
|
|
|
|
12,103,721
|
|
|
Cash
and cash equivalents, end of period
|
|
$
|
8,915,428
|
|
|
$
|
13,211,252
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents include cash on hand, amounts
due from banks, and
interest-bearing deposits.
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
schedule of noncash activities:
|
|
|
|
|
|
|
|
|
|
Net
change in valuation for unrealized gains/losses,
net of income tax, on
available-for-sale securities
|
|
$
|
964,552
|
|
|
$
|
1,170,126
|
|
|
Common
stock issued in connection with purchase of branch
real
estate
|
|
|
-
|
|
|
|
103,000
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosures of cash paid during the period for:
|
|
|
|
|
|
|
|
|
|
Income
taxes paid, net of refunds
|
|
$
|
220,000
|
|
|
$
|
664,500
|
|
|
Interest
paid
|
|
|
5,306,321
|
|
|
|
4,927,132
|
|
|
Insurance
Agency acquisitions - see Note 10
|
|
|
|
|
|
|
|
|
Affiliated
Trusts
|
|
Trust
Preferred
Securities
|
|
|
Common
Securities
|
|
|
Junior
Subordinated
Debentures
|
|
|
Interest
Rate
|
|
Maturity
Date
|
||||
NBN
Capital Trust II
|
|
$
|
3,000,000
|
|
|
$
|
93,000
|
|
|
$
|
3,093,000
|
|
|
|
8.03
|
%
|
March
30, 2034
|
NBN
Capital Trust III
|
|
|
3,000,000
|
|
|
|
93,000
|
|
|
|
3,093,000
|
|
|
|
6.50
|
%
|
March
30, 2034
|
NBN
Capital Trust IV
|
|
|
10,000,000
|
|
|
|
310,000
|
|
|
|
10,310,000
|
|
|
|
5.88
|
%
|
February
23, 2035
|
Total
|
|
$
|
16,000,000
|
|
|
$
|
496,000
|
|
|
$
|
16,496,000
|
|
|
|
6.40
|
%
|
|
September
30,
|
June
30,
|
|||||||
|
2007
|
2007
|
||||||
Residential
real estate
|
$ |
142,354,415
|
$ |
145,184,733
|
||||
Commercial
real estate
|
108,864,523
|
112,534,812
|
||||||
Construction
|
6,254,224
|
5,450,826
|
||||||
Commercial
|
38,917,994
|
40,783,958
|
||||||
Consumer
& Other
|
122,077,760
|
118,880,723
|
||||||
Total
|
418,468,916
|
422,835,052
|
||||||
Net
Deferred Costs
|
2,820,660
|
2,736,366
|
||||||
Total
Loans
|
$ |
421,289,576
|
$ |
425,571,418
|
|
|
Three
months Ended
September
30,
|
|
|||||
|
|
2007
|
|
|
2006
|
|
||
Balance
at beginning of period
|
|
$
|
5,756,000
|
|
|
$
|
5,496,000
|
|
Add
provision charged to operations
|
|
|
190,283
|
|
|
|
300,786
|
|
Recoveries
on loans previously charged off
|
|
|
17,788
|
|
|
|
40,998
|
|
|
|
|
5,964,071
|
|
|
|
5,837,784
|
|
Less
loans charged off
|
|
|
208,071
|
|
|
|
231,784
|
|
Balance
at end of period
|
|
$
|
5,756,000
|
|
|
$
|
5,606,000
|
|
|
|
September
30, 2007
|
|
|
June
30, 2007
|
|
||||||||||
|
|
Amortized
Cost
|
|
|
Fair
Value
|
|
|
Amortized
Cost
|
|
|
Fair
Value
|
|
||||
Debt
securities issued by U. S.
Government-sponsored enterprises
|
|
$
|
20,765,448
|
|
|
$
|
20,437,642
|
|
|
$
|
21,765,732
|
|
|
$
|
21,158,409
|
|
Mortgage-backed
securities
|
|
|
76,365,301
|
|
|
|
75,504,323
|
|
|
|
53,987,824
|
|
|
|
52,138,732
|
|
Municipal
Bonds
|
|
|
11,280,609
|
|
|
|
11,182,258
|
|
|
|
11,067,197
|
|
|
|
10,709,069
|
|
Corporate
bonds
|
|
|
500,000
|
|
|
|
493,285
|
|
|
|
500,000
|
|
|
|
484,625
|
|
Equity
securities
|
|
|
2,031,348
|
|
|
|
1,908,326
|
|
|
|
1,928,144
|
|
|
|
1,857,235
|
|
|
|
$
|
110,942,706
|
|
|
$
|
109,525,834
|
|
|
$
|
89,248,897
|
|
|
$
|
86,348,070
|
|
|
September
30, 2007
|
June
30, 2007
|
||||||||||||||
|
Amortized
Cost
|
Fair
Value
|
Amortized
Cost
|
Fair
Value
|
||||||||||||
Due
in one year or less
|
$ |
13,194,898
|
$ |
13,026,854
|
$ |
6,505,701
|
$ |
6,410,365
|
||||||||
Due
after one year through five years
|
5,680,304
|
5,630,635
|
13,370,205
|
12,989,363
|
||||||||||||
Due
after five years through ten years
|
997,048
|
983,290
|
996,925
|
972,840
|
||||||||||||
Due
after ten years
|
12,673,807
|
12,472,406
|
12,460,098
|
11,979,535
|
||||||||||||
Mortgage-backed
securities (including securities with interest rates
ranging
|
||||||||||||||||
from 4.0% to 6.4% maturing November 2007 to March
2037)
|
76,365,301
|
75,504,323
|
53,987,824
|
52,138,732
|
||||||||||||
Equity
securities
|
2,031,348
|
1,908,326
|
1,928,144
|
1,857,235
|
||||||||||||
|
$ |
110,942,706
|
$ |
109,525,834
|
$ |
89,248,897
|
$ |
86,348,070
|
September
30, 2007
|
||||
Principal
Amounts
|
|
Interest
Rates
|
|
Maturity
Dates For Periods Ending September 30,
|
$ 52,240,181
|
|
2.68% - 5.83%
|
|
2008
|
20,000,000
|
|
4.86 – 5.11
|
|
2009
|
3,000,000
|
|
4.99
|
|
2011
|
10,000,000
|
|
4.26
|
|
2017
|
$ 85,240,181
|
|
|
|
|
June
30, 2007
|
||||
Principal
Amounts
|
|
Interest
Rates
|
|
Maturity
Dates For Periods Ending June 30,
|
$ 50,016,698
|
|
2.68% - 5.69%
|
|
2008
|
30,000,000
|
|
4.86 - 5.21
|
|
2009
|
3,000,000
|
|
4.99
|
|
2011
|
10,000,000
|
|
4.26
|
|
2017
|
$ 93,016,698
|
|
|
|
|
Amount
|
Interest
Rate
|
Cap/Floor
|
Amount
of Cap/Floor
|
Strike
Rate
|
||||
$20,000,000
|
4.68%
|
Purchased
Caps
|
$40,000,000
|
5.50%
|
||||
$10,000,000
|
3.98%
|
Sold
Floors
|
$20,000,000
|
4.86%
|
Purchase
Price:
|
Hartford
|
|||
Cash
|
$ |
425,250
|
||
Debt
|
933,000
|
|||
Acquisition
Costs
|
5,181
|
|||
Total
|
$ |
1,363,431
|
||
|
||||
Allocation:
|
||||
Customer
List
|
$ |
679,000
|
||
Non-compete
Agreement
|
100,000
|
|||
Goodwill
|
584,431
|
|||
Total
|
$ |
1,363,431
|
||
|
|
|
Difference
Due to
|
|
|
|
|
||||||
|
|
Volume
|
|
|
Rate
|
|
|
Total
|
|
|||
Investments
|
|
$
|
80,762
|
|
|
$
|
73,785
|
|
|
$
|
154,547
|
|
Loans,
net
|
|
|
(254,546
|
)
|
|
|
35,619
|
|
|
|
(218,927
|
)
|
FHLB
& Other Deposits
|
|
|
(3,208
|
)
|
|
|
2,814
|
|
|
|
(394
|
)
|
Total
Interest-earnings Assets
|
|
|
(176,992
|
)
|
|
|
112,218
|
|
|
|
(64,774
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
(258,386
|
)
|
|
|
322,308
|
|
|
|
63,922
|
|
Securities
sold under repurchase Agreements
|
|
|
28,932
|
|
|
|
35,664
|
|
|
|
64,596
|
|
Borrowings
|
|
|
280,407
|
|
|
|
48,503
|
|
|
|
328,910
|
|
Total
Interest-bearing Liabilities
|
|
|
50,953
|
|
|
|
406,475
|
|
|
|
457,428
|
|
Net
Interest and Dividend Income
|
|
$
|
(227,945
|
)
|
|
$
|
(294,257
|
)
|
|
$
|
(522,202
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rate/volume
amounts which are partly attributable to rate and volume
are spread
proportionately between volume and rate based on the
direct change
attributable to rate and volume. Borrowings in the
table include junior
subordinated notes, FHLB borrowings, structured repurchase
agreement,
capital lease obligation and other borrowings. The
adjustment to interest
income and yield on a fully tax equivalent basis was
$49,577 and $49,249
for the three months ended September 30, 2007 and 2006,
respectively.
|
|
|
Consumer
Loans as of
|
|
||||||||||||||
September
30,
|
June
30,
|
|||||||||||||||
2007
|
%
of Total
|
2007
|
%
of Total
|
|||||||||||||
Indirect
Auto
|
$ |
36,348,353
|
30 | % | $ |
36,808,246
|
31 | % | ||||||||
Indirect
RV
|
56,233,605
|
46 | % |
51,611,223
|
43 | % | ||||||||||
Indirect
Mobile Home
|
23,860,006
|
19 | % |
24,961,562
|
21 | % | ||||||||||
Subtotal Indirect
|
116,441,964
|
95 | % |
113,381,031
|
95 | % | ||||||||||
Other
|
5,635,796
|
5 | % |
5,499,692
|
5 | % | ||||||||||
Total
|
$ |
122,077,760
|
100 | % | $ |
118,880,723
|
100 | % |
September
30,
|
June
30,
|
|||||||
Description
|
|
2007
|
|
|
2007
|
|
||
Residential
Real Estate
|
|
$
|
495,000
|
|
|
$
|
477,000
|
|
Commercial
Real Estate
|
|
|
1,391,000
|
|
|
|
2,033,000
|
|
Commercial
Loans
|
|
|
2,452,000
|
|
|
|
2,104,000
|
|
Consumer
and Other
|
|
|
399,000
|
|
|
|
476,000
|
|
Total
non-performing
|
|
$
|
4,737,000
|
|
|
$
|
5,090,000
|
|
9-30-07
|
6-30-07
|
3-31-07
|
12-31-06
|
9-30-06
|
3.11%
|
2.90%
|
2.47%
|
2.93%
|
2.54%
|
Brokered
time deposits
|
$ |
124,559,000
|
Subject
to policy limitation of 25% of total assets
|
|
Federal
Home Loan Bank of Boston
|
$ |
16,476,000
|
Unused
advance capacity subject to eligible and qualified
collateral
|
|
Federal
Reserve Bank Discount Window Borrower-in-Custody
|
$ |
26,690,000
|
Unused
credit line subject to the pledge of indirect auto
loans
|
|
Total
Unused Borrowing Capacity
|
$ |
167,725,000
|
|
Affiliated
Trusts
|
|
Outstanding
Balance
|
|
|
Rate
|
|
First
Call Date
(At
Par)
|
||||
NBN
Capital Trust II
|
|
$
|
3,093,000
|
|
|
|
8.03
|
%
|
March
30, 2009
|
||
NBN
Capital Trust III
|
|
|
3,093,000
|
|
|
|
6.50
|
%
|
March
30, 2009
|
||
NBN
Capital Trust IV
|
|
|
10,310,000
|
|
|
|
5.88
|
%
|
February
23, 2010
|
||
Total
|
|
$
|
16,496,000
|
|
|
|
6.40
|
%
|
|
Northeast
Bancorp
|
|
Actual
|
|
|
Required
For Capital Adequacy Purposes
|
|
|
Required
To Be "Well Capitalized" Under Prompt Corrective Action
Provisions
|
|
|||||||||||||||
(Dollars
in Thousands)
|
|
Amount
|
|
|
Ratio
|
|
|
Amount
|
|
|
Ratio
|
|
|
Amount
|
|
|
Ratio
|
|
||||||
As
of September 30, 2007:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total
capital to risk weighted assets
|
|
$
|
55,274
|
|
|
|
13.45
|
%
|
|
$
|
32,870
|
|
|
|
8.00
|
%
|
|
$
|
41,087
|
|
|
|
10.00
|
%
|
Tier
1 capital to risk weighted assets
|
|
$
|
47,201
|
|
|
|
11.49
|
%
|
|
$
|
16,435
|
|
|
|
4.00
|
%
|
|
$
|
24,652
|
|
|
|
6.00
|
%
|
Tier
1 capital to total average assets
|
|
$
|
47,201
|
|
|
|
8.53
|
%
|
|
$
|
22,141
|
|
|
|
4.00
|
%
|
|
$
|
27,677
|
|
|
|
5.00
|
%
|
Northeast
Bank
|
|
Actual
|
|
|
Required
For Capital Adequacy Purposes
|
|
|
Required
To Be "Well Capitalized" Under Prompt Corrective Action
Provisions
|
|
|||||||||||||||
(Dollars
in Thousands)
|
|
Amount
|
|
|
Ratio
|
|
|
Amount
|
|
|
Ratio
|
|
|
Amount
|
|
|
Ratio
|
|
||||||
As
of September 30, 2007:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total
capital to risk weighted assets
|
|
$
|
49,462
|
|
|
|
12.09
|
%
|
|
$
|
32,726
|
|
|
|
8.00
|
%
|
|
$
|
40,908
|
|
|
|
10.00
|
%
|
Tier
1 capital to risk weighted assets
|
|
$
|
44,338
|
|
|
|
10.84
|
%
|
|
$
|
16,363
|
|
|
|
4.00
|
%
|
|
$
|
24,545
|
|
|
|
6.00
|
%
|
Tier
1 capital to total average assets
|
|
$
|
44,338
|
|
|
|
8.11
|
%
|
|
$
|
21,864
|
|
|
|
4.00
|
%
|
|
$
|
27,330
|
|
|
|
5.00
|
%
|
|
|
Payments
Due by Period
|
||||||||||||||||||
Contractual
Obligations
|
Total
|
Less
Than
1
Year
|
1-3
Years
|
4-5
Years
|
After
5 Years
|
|||||||||||||||
FHLB
advances
|
$ |
85,240,181
|
$ |
52,240,181
|
$ |
20,000,000
|
$ |
3,000,000
|
$ |
10,000,000
|
||||||||||
Structured
repurchase agreements
|
30,000,000
|
-
|
30,000,000
|
-
|
-
|
|||||||||||||||
Junior
subordinated debentures
|
16,496,000
|
-
|
16,496,000
|
-
|
-
|
|||||||||||||||
Capital
lease obligation
|
2,620,886
|
135,791
|
292,867
|
323,730
|
1,868,498
|
|||||||||||||||
Other
borrowings
|
3,200,057
|
648,236
|
1,244,910
|
647,621
|
659,290
|
|||||||||||||||
Total
long-term debt
|
137,557,124
|
53,024,208
|
68,033,777
|
3,971,351
|
12,527,788
|
|||||||||||||||
|
|
|||||||||||||||||||
Operating
lease obligations (1)
|
2,421,061
|
489,637
|
810,763
|
713,322
|
407,339
|
|||||||||||||||
Total
contractual obligations
|
$ |
139,978,185
|
$ |
53,513,845
|
$ |
68,844,540
|
$ |
4,684,673
|
$ |
12,935,127
|
||||||||||
|
||||||||||||||||||||
|
|
Amount
of Commitment Expiration - Per Period
|
||||||||||||||||||
Commitments
with off-balance sheet risk
|
Total
|
Less
Than
1
Year
|
1-3
Years
|
4-5
Years
|
After
5 Years
|
|||||||||||||||
Commitments
to extend credit (2)(4)
|
$ |
23,805,233
|
$ |
23,805,233
|
$ |
-
|
$ |
-
|
$ |
-
|
||||||||||
Commitments
related to loans held for sale(3)
|
1,618,320
|
1,618,320
|
-
|
-
|
-
|
|||||||||||||||
Unused
lines of credit (4)(5)
|
44,704,929
|
20,440,982
|
5,800,639
|
2,811,171
|
15,652,137
|
|||||||||||||||
Standby
letters of credit (6)
|
952,318
|
952,318
|
-
|
-
|
-
|
|||||||||||||||
|
$ |
71,080,800
|
$ |
46,816,853
|
$ |
5,800,639
|
$ |
2,811,171
|
$ |
15,652,137
|
(1)
|
Represents
an off-balance sheet obligation.
|
(2)
|
Represents
commitments outstanding for residential real estate,
commercial real
estate, and commercial loans.
|
(3)
|
Commitments
of residential real estate loans that will be held
for
sale.
|
(4)
|
Loan
commitments and unused lines of credit for commercial
and construction
loans expire or are subject to renewal in twelve months
or
less.
|
(5)
|
Represents
unused lines of credit from commercial, construction,
and home equity
loans.
|
(6)
|
Standby
letters of credit generally expire in twelve
months.
|
Item
1.
|
Legal
Proceedings
None.
|
|||||
|
|
|||||
Item
1. a.
|
Risk
Factors
There
have been no material changes in the risk factors set
forth in the last
10-K.
|
|||||
|
|
|||||
Item
2.(c)
|
Unregistered
Sales of Equity Securities and Use of Proceeds
The
following table provides information on purchases made
by or on behalf of
the Company of shares of Northeast Bancorp common stock
during the
indicated periods.
|
|||||
|
Period
(1)
|
Total
Number
Of
Shares
Purchased
(2)
|
Average
Price
Paid
per Share
|
Total
Number of
Shares
Purchased
as
Part of Publicly
Announced
Program
|
Maximum
Number of
Shares
that May Yet be
Purchased
Under
The
Program (3)
|
|
|
Jul.
1 – Jul. 31
|
-
|
-
|
-
|
196,200
|
|
|
Aug.
1 – Aug. 31
|
50,000
|
17.90
|
50,000
|
146,200
|
|
|
Sep.
1 – Sep. 30
|
27,500
|
17.75
|
27,500
|
118,700
|
|
|
|
|
|
|
|
|
(1)
|
Based
on trade date, not settlement date.
|
|||||
(2)
|
Represents
shares purchased in open-market transactions pursuant
to the Company's
2006 Stock Repurchase Plan.
|
|||||
(3)
|
On
December 15, 2006, the Company announced that its Board
of Directors of
the Company approved the 2006 Stock Repurchase Plan
pursuant to which the
Company is authorized to repurchase in open-market
transactions up to
200,000 shares from time to time until the plan expires
on December 31,
2007, unless extended.
|
|||||
|
|
|||||
Item
3.
|
Defaults
Upon Senior Securities
None
|
|||||
|
|
|||||
Item
4.
|
Submission
of Matters to a Vote of Security Holders
None
|
|||||
|
|
|||||
Item
5.
|
Other
Information
None.
|
|||||
|
|
|||||
Item
6.
|
Exhibits
|
|||||
|
List
of Exhibits:
|
|||||
|
Exhibits
No.
|
Description
|
||||
3.1
|
Articles
(incorporated by reference to the Company's June 30,
2007 10K filed on
September 27, 2007)
|
|||||
3.2
|
Bylaws
(incorporated by reference to the Company's June 30,
2007 10K filed on
September 27, 2007)
|
|||||
|
11
|
Statement
Regarding Computation of Per Share Earnings.
|
||||
|
31.1
|
Certification
of the Chief Executive Officer pursuant to Section
302 of the
Sarbanes-Oxley Act of 2002 (Rule 13a-14(a)).
|
||||
|
31.2
|
Certification
of the Chief Financial Officer pursuant to Section
302 of the
Sarbanes-Oxley Act of 2002 (Rule 13a-14(a)).
|
||||
|
32.1
|
Certificate
of the Chief Executive Officer Pursuant to 18 U.S.C.
Section
1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 (Rule 13a-14(b)).
|
||||
|
32.2
|
Certificate
of the Chief Financial Officer Pursuant to 18 U.S.C.
Section
1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 (Rule 13a-14(b)).
|
Date: November
13, 2007
|
NORTHEAST BANCORP
|
|
|
By:
|
/s/
James D. Delamater
|
|
|
James D. Delamater
|
|
|
President and CEO
|
|
|
|
|
By:
|
/s/
Robert S. Johnson
|
|
|
Robert S. Johnson
|
|
|
Chief Financial Officer
|
|
|
|
EXHIBIT
NUMBER
|
DESCRIPTION
|
3.1
|
Articles (incorporated by reference to the Company's June 30, 2007 10K filed on September 27, 2007) |
3.2
|
Bylaws (incorporated by reference to the Company's June 30, 2007 10K filed on September 27, 2007) |
11
|
Statement
Regarding Computation of Per Share Earnings
|
31.1
|
Certification
of the Chief Executive Officer pursuant to Section
302 of the
Sarbanes-Oxley Act of 2002 (Rule 13a-14(a)).
|
31.2
|
Certification
of the Chief Financial Officer pursuant to Section
302 of the
Sarbanes-Oxley Act of 2002 (Rule 13a-14(a)).
|
32.1
|
Certificate
of the Chief Executive Pursuant to 18 U.S.C. Section
1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 (Rule
13a-14(b)).
|
32.2
|
Certificate
of the Chief Financial Officer Pursuant to 18 U.S.C.
Section
1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 (Rule 13a-14(b)).
|
NORTHEAST
BANCORP
|
||||||||
Exhibit
11. Statement Regarding Computation of Per Share Earnings
|
||||||||
Three
Months Ended
|
Three
Months Ended
|
|||||||
September
30, 2007
|
September
30, 2006
|
|||||||
EQUIVALENT
SHARES:
|
||||||||
Weighted
Average Shares Outstanding
|
2,415,952
|
2,448,762
|
||||||
Total
Diluted Shares
|
2,432,977
|
2,470,202
|
||||||
.
|
||||||||
Net
Income
|
$ |
430,565
|
$ |
454,667
|
||||
Basic
Earnings Per Share
|
$ |
0.18
|
$ |
0.19
|
||||
Diluted
Earnings Per Share
|
$ |
0.18
|
$ |
0.18
|
I,
James D. Delamater, certify that:
|
|
1.
|
I
have reviewed this quarterly report on Form 10-Q of Northeast
Bancorp;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement
of a
material fact or omit to state a material fact necessary to make
the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects
the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant
and have
|
(a) Designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to
ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is
being
prepared;
|
|
(b) Evaluated
the effectiveness of the registrant's disclosure controls and procedures
and presented in this report our conclusions about the effectiveness
of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation; and
|
|
(c) Disclosed
in this report any change in the registrant's internal control over
financial reporting that occurred during the registrant's most recent
fiscal quarter (the registrant's fourth quarter in the case of an
annual
report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial
reporting; and
|
|
5.
|
The
registrant's other certifying officer and I have disclosed, based
on our
most recent evaluation of internal control over financial reporting,
to
the registrant's auditors and the audit committee of the registrant's
board of directors (or persons performing the equivalent
functions):
|
(a) All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to
record,
process, summarize and report financial information;
and
|
|
(b) Any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
control
over financial reporting.
|
November
13, 2007
|
/s/
James D. Delamater
|
James
D. Delamater
|
|
Chief
Executive Officer
|
I,
Robert S. Johnson, certify that:
|
|
1.
|
I
have reviewed this quarterly report on Form 10-Q of Northeast
Bancorp;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement
of a
material fact or omit to state a material fact necessary to make
the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects
the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant
and have:
|
(a) Designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to
ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is
being
prepared;
|
|
(b) Evaluated
the effectiveness of the registrant's disclosure controls and procedures
and presented in this report our conclusions about the effectiveness
of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation; and
|
|
(c) Disclosed
in this report any change in the registrant's internal control over
financial reporting that occurred during the registrant's most recent
fiscal quarter (the registrant's fourth quarter in the case of an
annual
report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial
reporting; and
|
|
5.
|
The
registrant's other certifying officer and I have disclosed, based
on our
most recent evaluation of internal control over financial reporting,
to
the registrant's auditors and the audit committee of the registrant's
board of directors (or persons performing the equivalent
functions):
|
(a) All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to
record,
process, summarize and report financial information;
and
|
|
(b) Any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
control
over financial reporting.
|
November
13, 2007
|
/s/
Robert S. Johnson
|
Robert
S. Johnson
|
|
Chief
Financial Officer
|
In
connection with the Quarterly Report of Northeast Bancorp. (the "Company")
on Form 10-Q for the quarterly period ending September 30, 2007 as
filed
with the Securities and Exchange Commission on the date hereof (the
"Report"), I, James D. Delamater, as Chief Executive Officer of the
Company, hereby certify pursuant to 18 U.S.C. 1350, as adopted pursuant
to
906 of the Sarbanes-Oxley Act of
2002, that:
|
|
(1) The
Report fully complies with the requirements of Section 13(a) of the
Securities Exchange Act of 1934; and
|
|
(2) The
information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the
Company
for the dates and the periods covered by the Report.
|
|
A
signed original of this written statement has been provided to Northeast
Bancorp and will be retained by Northeast Bancorp and furnished to
the
Securities and Exchange Commission or its staff upon
request.
|
November
13, 2007
|
/s/
James D. Delamater
|
James
D. Delamater
|
|
Chief
Executive Officer
|
In
connection with the Quarterly Report of Northeast Bancorp. (the "Company")
on Form 10-Q for the quarterly period ending September 30, 2007 as
filed
with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Robert S. Johnson, as Chief Financial Officer of the
Company, hereby certify pursuant to 18 U.S.C. 1350, as adopted pursuant
to
906 of the Sarbanes-Oxley Act of
2002, that:
|
|
(1) The
Report fully complies with the requirements of Section 13(a) of the
Securities Exchange Act of 1934; and
|
|
(2) The
information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the
Company
for the dates and the periods covered by the Report.
|
|
A
signed original of this written statement has been provided to Northeast
Bancorp and will be retained by Northeast Bancorp and furnished to
the
Securities and Exchange Commission or its staff upon
request.
|
November
13, 2007
|
/s/
Robert S. Johnson
|
Robert
S. Johnson
|
|
Chief
Financial Officer
|