Abington Bancorp Reports 2001 Earnings; Steady Growth Hindered by One-Time Charges.Business Editors ABINGTON Abington, township (1990 pop. 59,084), Montgomery co., SE Pa., a residential suburb of Philadelphia; settled 1696, inc. 1906. The site of combat during the Revolutionary War, Abington has abrasives and other light manufacturing industries. , Mass.--(BUSINESS WIRE)--Jan. 25, 2002 Abington Bancorp, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on NMS See NetWare Management System. : ABBK) a one-bank holding company for Abington Savings Bank savings bank, financial institution that, until recently, performed only the following functions: receiving savings deposits of individuals, investing them, and providing a modest return to its depositors in the form of interest. ("the Bank"), today announced its 2001 earnings. 2001 earnings were $3,077,000 or $.95 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, after the cumulative effect of an accounting change, as compared to $4,493,000 or $1.41 per diluted share for 2000. For the three month period ended December December: see month. 31, 2001, the Bank reported a net loss of $410,000 or a loss per diluted share of $.13, as compared to net income of $1,038,000 and earnings per diluted share of $.33 for the corresponding period in 2000. The net earnings levels for 2001 were adversely influenced by several events in the fourth quarter. First, the Bank realized a loss on the sale of a corporate bond of approximately $2,200,000 which was previously disclosed. Management made the decision to sell this bond, which was the only investment holding which had been downgraded to below investment grade, after considering the issuer's (Crown,Cork & Seal) financial difficulties exacerbated by continuing asbestos asbestos, mineral asbestos, common name for any of a variety of silicate minerals within the amphibole and serpentine groups that are fibrous in structure and more or less resistant to acid and fire. litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. claims. Additionally, in the fourth quarter of 2001, the Bank recognized approximately $635,000 of writedowns primarily associated with management's re-valuation of some non-branch premises premises n. 1) in real estate, land and the improvements on it, a building, store, shop, apartment, or other designated structure. The exact premises may be important in determining if an outbuilding (shed, cabana, detached garage) is insured or whether a person and real estate holdings. The Bank also elected to change its accounting to reflect promotional gifts given to customers as a marketing expense through the early adoption of a new accounting pronouncement. Previously, these costs had been capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. and amortized over the life of the accounts. The cumulative effect of this change in accounting principle was approximately $497,000 and it is presented in this statement of operations See Income statement. on a separate line, net of applicable tax effects, at $298,000. "While the impact of these one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. charges and an increase in the provision for loan losses (discussed later) were significant, the Bank's financial performance in 2001 showed gains in a number of areas including growth in deposits, fees and net interest margins", noted President & Chief Executive Officer James James, person in the Bible James, in the Gospel of St. Luke, kinsman of St. Jude. The original does not specify the relationship. James, rivers, United States James. P. McDonough McDonough is the name of several places in the United States:
tr. & intr.v. deep·ened, deep·en·ing, deep·ens To make or become deep or deeper. deepen Verb to make or become deeper or more intense Verb 1. customer relationships has been a critical part of our retail strategy and overall success in the past several years," said McDonough. Mr. McDonough continued by stating, "Net interest margins have also been stronger in 2001 at 3.24% as compared to 2.97% in 2000. The increase in margins is attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the Bank's continued success in attracting core deposit relationships as well as the steepening of the yield curve Steepening of the yield curve A change in the yield curve where the spread between the yield on a long-term and short-term Treasury has increased. Compare flattening of the yield curve and butterfly shift. . This has allowed the Bank to decrease overall cost of funds Cost of Funds The interest rate paid on an outstanding loan. Notes: Money isn't free! Cost of funds is the cost of borrowing money. See also: Interest Rate Cost of funds Interest rate associated with borrowing money. on wholesale funding rapidly to offset the impact that the overall low interest rate environment is beginning to have on asset yields." "Additionally, mortgage banking activities contributed to our level of success in 2001," noted McDonough. "This area of our business contributed roughly $595,000 of net income or $.18 per diluted share in 2001 as compared to a net loss of approximately $57,000 or $.02 per share in 2000. This is reflective Refers to light hitting an opaque surface such as a printed page or mirror and bouncing back. See reflective media and reflective LCD. of a very favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. market for residential loan originations The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. and refinancings as well as the Bank's solid position in the marketplace as a mortgage provider. The current outlook for mortgage banking activities for 2002 looks to be positive although we do expect less of a contribution to earnings from mortgage banking activities in 2002 as the expectations are for lower application volumes from the record levels in 2001." "While earnings results were disappointing in 2001, there continues to be several underlying positive business trends which we feel we can continue to build upon in 2002," noted McDonough. He continued, "Based on these factors, we feel that the current street estimates for the Bank's 2002 earnings of $1.75 per share are reasonable and achievable given our assessment of current conditions", continued McDonough. The Company disclaims any intent or obligation to update this information, whether in response to new information, future events or otherwise. Despite the unusual items noted earlier, the Bank's earnings overall were strong enough to withstand some unexpected losses which related to the overall slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. in the economy. For instance, the provision for loan losses increased to $1,705,000 in 2001 as compared to $160,000 for the same period in 2000, an increase of $1,545,000. This increase in provisions for loan losses was primarily related to two credits, both of which are on non-accrual at December 31, 2001, the most significant of which is a $3,363,000 relationship which is primarily a commercial credit involved in the telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. industry. Without this credit alone, delinquency delinquency Criminal behaviour carried out by a juvenile. Young males make up the bulk of the delinquent population (about 80% in the U.S.) in all countries in which the behaviour is reported. rates and levels of non-performing assets are consistent with prior periods although further portfolio deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. could occur should the economy decline further. At December 31, 2001, assets totaled $770,118,000, and net loans and deposits were $403,552,000 and $497,459,000, respectively. Stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. was $39,151,000 or 5.1 % of total assets. Book value per common share Book Value Per Common Share A measure used by owners of common shares in a firm to determine the level of safety associated with each individual share after all debts are paid accordingly. Formula: at December 31, 2001 was $12.56. Abington Savings Bank is a Massachusetts-chartered savings bank with offices in Abington, Brockton Brockton, industrial city (1990 pop. 92,788), Plymouth co., E Mass.; settled c.1700, set off from Bridgewater 1821, inc. as a city 1881. It formerly had a large shoe and leather products industry. , Canton Canton, cities, United States Canton. 1 City (1990 pop. 13,922), Fulton co., W central Ill., in the corn belt; inc. 1849. It is a trade and industrial center for a coal and farm area. 2 Town (1990 pop. 18,530), Norfolk co. , Cohasset Cohasset can refer to:
Halifax, city (1991 pop. 114,455), provincial capital, S central N.S., Canada, on the Atlantic Ocean. It is the largest city in the Maritime Provinces and is one of Canada's principal ice-free Atlantic ports. , Hanover Hanover, city, Germany Hanover, Ger. Hannover, city (1994 pop. 524,820), capital of Lower Saxony, N Germany, on the Leine River and the Midland Canal. , Hanson Hanson may refer to:
Kingston, city (1991 pop. 56,597), S Ont., Canada, on Lake Ontario, near the head of the St. Lawrence River and at the end of Rideau Canal from Ottawa. Kingston has probably the best harbor on the lake. , Pembroke Pembroke, town, Canada Pembroke (pĕm`brōk), town (1991 pop. 13,997), SE Ont., Canada, NW of Ottawa, on the Ottawa River. It is a lumbering center and also has steel and electric-products factories. , Randolph Randolph, town (1990 pop. 30,093), Norfolk co., E Mass.; settled c.1710, set off from Braintree and inc. 1793. A suburb of Boston, it has diverse light manufacturing. and Whitman Whitman, town (1990 pop. 13,240), Plymouth co., SE Mass., S of Boston; settled c.1670, set off from Abington and inc. 1875. It is an industrial town that manufactures shoes, plastics, foundry products, and textile machinery. The Toll House (1709) is restored. . Its deposits are insured by the Federal Deposit Insurance Corporation Federal Deposit Insurance Corporation (FDIC), an independent U.S. federal executive agency designed to promote public confidence in banks and to provide insurance coverage for bank deposits up to $100,000. and Depositors Insurance Fund The Depositors Insurance Fund was created by the state government of Massachusetts in response to the large number of Massachusetts bank failures during the Great Depression. The Federal Deposit Insurance Corporation was inspired by this fund. . Certain statements herein constitute "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " that involve a number of risks and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking statements, including changing regional and national economic conditions, changes in the real estate market, changes in levels of market interest rates, credit risks of lending activities, and competitive and regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. factors.
ABINGTON BANCORP, INC.
Operating Results
(Dollars in thousands, except share and per share data)
Three Months Ended Year Ended
December 31, December 31,
(unaudited)
2001 2000 2001 2000
Interest and
dividend income $12,317 $12,496 $50,493 $48,349
Net interest income 5,831 5,058 22,850 19,953
Provision for
possible loan losses 865 100 1,705 160
Non-interest income:
Loan fees 52 72 255 311
Customer service fees 2,314 1,921 7,949 6,396
Gains (loss) on
securities, net (1,676) 3 (1,723) 405
Gains on mortgages, net 882 437 2,888 1,315
Loss on sale of
other real estate (2) -- (2) --
Other 90 115 402 472
Total non-interest
income 1,660 2,548 9,769 8,899
Non-interest expenses:
Salaries and
employee benefits 3,132 2,989 12,521 11,022
Occupancy and equipment 1,517 809 4,032 3,201
Trust preferred
securities expense 280 280 1,120 1,120
Other non-interest
expense 2,423 1,753 8,032 6,332
Total non-interest
expense 7,352 5,831 25,705 21,675
Income before
income taxes (726) 1,675 5,209 7,017
Net income before
cumulative effect
of accounting change (410) 1,038 3,375 4,493
Cumulative effect of
change in accounting
for costs of
sales incentives -- -- (298) --
Net income (loss) $(410) $1,038 $3,077 $4,493
Dividends per share $.10 $.09 $.40 $.36
Basic earnings
per share -
Income before
cumulative effect
of accounting change $(.13) $.34 $1.09 $1.46
Cumulative effect
of accounting change -- -- $(.10) --
Net income (loss) $(.13) $.34 $.99 $1.46
Weighted average
common shares - basic 3,113,000 3,067,000 3,103,000 3,068,000
Diluted - earnings
per share -
Income before
cumulative effect
of accounting change $(.13) $.33 $1.04 $1.41
Cumulative effect
of accounting change -- -- $(.09) --
Net income (loss) $(.13) $.33 $.95 $1.41
Weighted average
common shares
- diluted 3,113,000 3,172,000 3,239,000 3,186,000
ABINGTON BANCORP, INC.
Balance Sheet Data
(Dollars in thousands, except share and per share data)
December 31, December 31,
2001 2000
Investments(1) $277,627 $290,211
Loans, net 403,552 374,138
Allowance for loan losses 5,482 3,856
Intangible assets 2,259 2,710
Total assets 770,118 728,249
Deposits 497,459 454,747
Stockholders' equity:
Equity, excluding effect
of investment market value,
net of taxes 37,512 35,500
Unrealized gain (loss) on
securities, net of taxes 1,639 (1,195)
Total $39,151 $34,305
Book value per share $12.56 $11.18
Shares outstanding 3,118,000 3,068,000
Branch Openings
Randolph April 1998
Hanson September 1998
Brockton May 1999
Canton November 2000
Hanover July 2001
(1) All of the Company's investments are classified as available for
sale even though management does not necessarily have any plans or
intentions to sell these securities in the immediate future. As
required by the accounting rules, these securities are marked to
market, net of applicable taxes, through shareholders equity.
ABINGTON BANCORP, INC.
Yields and Returns
Year Ended
December 31,
2001 2000
Return on assets .40% .64%
Return on equity 8.02% 15.14%
Net overhead ratio(1) 1.86% 1.80%
Yields
Year Ended
December 31,
2001 2000
Loans 7.66% 7.60%
Bonds and Government Obligations 7.30% 6.92%
Mortgage Backed Securities 6.62% 6.78%
Equities and FHLB Stock 4.77% 4.81%
Earning assets 7.17% 7.20%
Now and DDAs(2) .33% .42%
Savings and Money Market 2.19% 2.26%
Time deposits 5.72% 5.54%
Total Deposits 3.59% 3.60%
Borrowed funds 5.77% 6.32%
Cost of funds 3.97% 4.31%
Interest margin 3.24% 2.97%
(1) Excludes the accrued distributions (expenses) related to trust
preferred securities, the cumulative effect of change in
accounting principle and securities gains/(losses).
(2) Includes the effect of average non-interest bearing DDAs which
were $62,110,000 and $53,553,000, in 2001 and 2000, respectively.
ABINGTON BANCORP, INC.
Asset Quality Statistics
(Dollars in thousands)
December 31, December 31,
2001 2000
Non accrual loans(1) $3,881 $549
Loans greater than 90 days still accruing 78 7
Non performing loans 3,959 556
Other real estate owned -- --
Non performing assets $3,959 $556
Loan loss reserve to non performing loans 138.5% 693.5%
Loan loss reserve to total loans 1.34% 1.02%
Delinquency ratio(1) 1.16% .22%
Tier I capital leverage ratio 6.16% 6.13%
Total risk-based capital ratio 12.82% 12.14%
12 Months 12 Months
Ended Ended
December 31, December 31,
2001 2000
Allowance for loan losses,
beginning of period $3,856 $3,701
Charge-offs (243) (284)
Recoveries 164 279
Net (charge-offs) recoveries (79) (5)
Provision for possible loan losses 1,705 160
Allowance for loan losses,
end of Period $5,482 $3,856
(1) These amounts include a single commercial relationship and an
associated residential mortgage with total balances of $3,363.
Without factoring in this relationship, the nonaccrual loans and
delinquency rate is $518 and .30%, respectively at December 31,
2001.
ABINGTON BANCORP, INC
Segment Analysis
(Dollars in thousands)
Year Ended
December 31,
2001
Community Mortgage
Banking Banking Other Elimination Consolidated
Total interest
income $50,471 $667 $18 $(663) $50,493
Net interest
income 22,722 110 18 -- 22,850
Provision for
possible loan
losses 1,705 -- -- -- 1,705
Total non-interest
income 6,881 2,899 -- (11) 9,769
Total non-interest
expense 22,652 1,933 1,120 -- 25,705
Net income (loss) 3,218 595 (729) (7) 3,077
Year Ended
December 31,
2000
Community Mortgage
Banking Banking Other Elimination Consolidated
Total interest
income $48,386 $341 $61 $(439) $48,349
Net interest
income 19,867 25 61 -- 19,953
Provision for
possible loan
losses 160 -- -- -- 160
Total non-interest
income 7,585 1,507 -- (193) 8,899
Total non-interest
expense 18,887 1,549 1,239 -- 21,675
Net income (loss) 5,451 (57) (776) (125) 4,493
ABINGTON BANCORP, INC.
Other Key Loan and Deposit Information
(Dollars in thousands)
December 31, December 31,
2001 2000
Loan portfolio:
Residential $275,514 $261,702
Home equity 28,301 27,415
Commercial real estate 83,874 65,238
Commercial 13,994 15,981
Other 7,351 7,658
Total loans and loans held for sale $409,034 $377,994
Deposits:
DDA's $ 66,344 $ 62,025
Now's 79,659 67,246
Savings & Money Market 163,798 135,494
Core deposits $ 309,801 $ 264,765
Time deposits 187,658 189,982
Total Deposits $497,459 $454,747
Loan Originations - Mortgage Banking
(Dollars in thousands)
Applications(1): 2001 2000
Quarter 1 $ 76,800 $ 40,700
Quarter 2 61,900 37,900
Quarter 3 65,900 34,300
Quarter 4 90,900 34,800
Year to Date $295,500 $147,700
(1) Applications typically take 30 to 60 days to convert into loan
sales.
ABINGTON BANCORP, INC.
Quarterly Earnings for 2001
(Dollars in thousands, except share and per share data)
First Second Third Fourth
Quarter Quarter Quarter Quarter 2001
Net interest income $ 5,318 $ 5,702 $ 5,999 $ 5,831 $ 22,850
Provision for possible
loan losses -- 330 510 865 1,705
Non-interest income 2,446 2,911 2,752 1,660 9,769
Non-interest expense 5,893 6,209 6,251 7,351 25,704
Income (loss) before
income taxes 1,871 2,074 1,990 (725) 5,210
Income tax provision
(benefit) 656 741 753 (315) 1,835
Net income 1,215 1,333 1,237 (410) 3,375
Cumulative effect of
change in accounting (298) -- -- -- (298)
Net income (loss) $ 917 $ 1,333 $ 1,237 $ (410) $ 3,077
Basic earnings (loss)
per share-
Income (loss) before
cumulative effect of
accounting change $ 0.40 $ 0.43 $ 0.40 $ (0.13) $ 1.09
Cumulative effect of
accounting change (0.10) -- -- -- (0.10)
Income (loss)
per share $ 0.30 $ 0.43 $ 0.40 $ (0.13) $ 0.99
Weighted average
common shares -
basic 3,078 3,109 3,111 3,113 3,103
Diluted earnings
(loss) per share-
Income (loss) before
cumulative effect of
accounting change $ 0.38 $ 0.41 $ 0.38 $ (0.13) $ 1.04
Cumulative effect of
accounting change (0.09) -- -- -- (0.09)
Income (loss)
per share $ 0.29 $ 0.41 $ 0.38 $ (0.13) $ 0.95
Weighted average
common shares -
diluted 3,208 3,236 3,262 3,113 3,239
|
|
||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion