Abington Bancorp Requests Extension for Filing Form 10-K.Business Editors WEYMOUTH, Mass.--(BUSINESS WIRE)--April 1, 2003 Revising 2002 Results to Account for Impact of Accelerated Mortgage Prepayment Prepayment 1. The payment of a debt obligation prior to its due date. 2. The excess payment over a scheduled debt repayment amount. Notes: 1. Examples include deferred expenses such as rent and early loan repayments. 2. on Securities Portfolio Abington Bancorp (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 : 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 that it has filed a Form 12b-25 with the Securities and Exchange Commission requesting an extension for filing its Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 2002. The Bank expects to file its Form 10-K on or before April 15, 2003. The Bank is delaying its filing to revise previously reported 2002 results to account for the impact of increased mortgage prepayment assumptions, as well as errors in accounting for the distribution of certain payments received, on portions of the Company's MBS See Mb/sec. MBS - mobile broadband services (mortgage backed securities) portfolio. MBSs are investment-grade securities backed by pools of mortgages of differing maturities. Borrowers taking advantage of interest rates at 40-year lows are prepaying mortgages at an accelerated pace, thus shortening the schedule for amortizing the premiums paid for certain of these securities. During an internal review by its accounting department, the Bank determined that underlying prepayment assumptions used in the calculation of net interest margins in 2002 did not adequately reflect the actual prepayment rates of certain of the securities in its portfolio. The Bank also determined that certain payments received on a portion of its MBS portfolio were not properly applied. Correcting these assumptions and related accounting issues will result in a downward adjustment in the Bank's interest income, and is expected to cause the Bank's adjusted earnings per share for 2002 to decrease by no more than $.58 per diluted share from the previously-reported $2.07. Diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of for the years ended December 31, 2001 and December 31, 2000 were $0.95 and $1.41, respectively. James P. McDonough, President and Chief Executive Officer, commented, "We have been quick to refine our financial model to pinpoint the effect of this accounting issue on our 2002 results, have adjusted our prepayment assumptions going forward and already have taken the necessary proactive steps in the management of our entire investment portfolio to mitigate the impact on our 2003 results." The Bank plans to hold a conference call to address this issue in detail following the filing of its Form 10-K. Details of the call will be issued at that time. About Abington Bancorp. Abington Savings Bank is a Massachusetts-chartered savings bank with offices in Abington, Boston (Dorchester), Brockton, Canton, Cohasset, Halifax, Hanover, Hanson, Holbrook, Hull, Kingston, Milton, Pembroke, Quincy, Randolph and Whitman. 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. ," within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995, that involve a number of risks and uncertainties that could cause actual results to differ materially from those indicated, including changing regional and national economic conditions, changes in the real estate market, changes in levels of market interest rates, credit risks on lending activities, and competitive and regulatory factors. All forward-looking statements are necessarily speculative and undue reliance should not be placed on any such statements, which are accurate only as of the date made. The Company disclaims any duty to update such forward-looking statements. |
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