Home Bancorp of Elgin, Inc. announces fourth quarter and year end operating results.ELGIN Elgin, town, ScotlandElgin, town (1991 pop. 18,702), Moray, NE Scotland, on the Lossie River. Lossiemouth is its port. Elgin is the market town for Moray's farm belt. Woolen textiles are manufactured, and scotch is distilled. , Ill.--(BUSINESS WIRE)--Jan. 21, 1997--Home Bancorp of Elgin, Inc. (Nasdaq: HBEI) ("Home Bancorp" or the "Company"), the holding company for Home Federal Savings and Loan Association Home Federal Savings and Loan Association was a federal stock savings and loan association operating in Fayetteville, North Carolina, Lumberton, North Carolina, and Spring Lake, North Carolina with consolidated assets of $155.6 million, as of July 31, 1997. of Elgin ("Home Federal" or the "Association"), today reported its results of operations for the three months and the year ended December December: see month. 31, 1996. For the fourth quarter of 1996, the Company reported net income of $731,000, or $0.11 per share, as compared to net income of $500,000 for the fourth quarter of 1995. For the year ended December 31, 1996, the Company reported net income of $642,000, or $0.10 per share, as compared to net income of $2,364,000 for the year ended December 31, 1995. Home Bancorp's results for the year ended December 31, 1996 includes a one time after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. charge of $1,077,000 resulting from the recently-enacted assessment to recapitalize re·cap·i·tal·ize tr.v. re·cap·i·tal·ized, re·cap·i·tal·iz·ing, re·cap·i·tal·iz·es To change the capital structure of (a corporation). re·cap the Savings Association Insurance Fund Savings Association Insurance Fund (SAIF) A government organization that replaced the Federal Savings and Loan Insurance Corporation as the provider of deposit insurance for thrift institutions. (the "SAIF") and a one time after-tax charge of $512,000 resulting from the termination of the Association's pension plan. The operating results for the year ended December 31, 1996 are primarily those of the Association, since Home Bancorp became the Association's holding company in connection with the Association's conversion from the mutual to the stock form in September September: see month. 26, 1996. The operating results for the three months and the year ended December 31, 1995 are those of Home Federal only, since Home Bancorp was not in existence during such time. "The most significant event in the fourth quarter was the relocation RELOCATION, Scotch law, contracts. To let again to renew a lease, is called a relocation. 2. When a tenant holds over after the expiration of his lease, with the consent of his landlord, this will amount to a relocation. and grand opening of the new South Elgin Office," said George George, river, c.345 mi (560 km) long, rising in a lake on the Quebec-Labrador boundary, E Canada. It flows N through Indian Lake (125 sq mi/324 sq km) to Ungava Bay (an arm of Hudson Strait). Perucco, President and Chief Executive Officer. "The new location is in the heart of the area that has experienced commercial and residential growth recently. 1996 has certainly been an exciting year of change with the successful completion of the conversion from mutual to stock ownership, the well received initial public offering and the recapitalization Recapitalization Restructuring a company's debt and equity mixture often with the aim of making a company's capital structure more stable. Notes: Companies often want to diversify their debt-to-equity ratio to improve liquidity. of SAIF." The $231,000 increase in Home Bancorp's net income for the fourth quarter of 1996 as compared to the corresponding period in 1995, was due primarily to an increase in interest income and a decrease in interest expense, which was partially offset by an increase in non-interest expense. The increase in interest income was due to an increase in the average balance of interest-earning assets, related primarily to the conversion, which was partially offset by a decrease in the average yield on interest earning assets Earning Assets Any income-earning asset owned by a company. Notes: These assets are generally interest-bearing accounts, bonds, and securities available for sale. See also: Asset, Asset Valuation, Earnings, Net Interest Margin . The decrease in interest expense was due primarily to a decrease in the average balance of interest-bearing Adj. 1. interest-bearing - of financial obligations on which interest is paid liabilities. The increase in non-interest expense was due primarily to increases in compensation and benefits expense, advertising and promotion expense and other expense. The increase in compensation and benefits expense was due to the new Employee Stock Ownership Plan (the "ESOP ESOP See: Employee Stock Ownership Plan ESOP See Employee Stock Ownership Plan (ESOP). ") which was established as part of the conversion to the stock form of ownership. The increase in advertising and promotion expense was primarily due to the promotion expense associated with the opening of the newly relocated re·lo·cate v. re·lo·cat·ed, re·lo·cat·ing, re·lo·cates v.tr. To move to or establish in a new place: relocated the business. v.intr. South Elgin office. The increase in other expense was primarily due to increases in real estate expense, legal expense, office supply expense and postage POSTAGE. The money charged by law for carrying letters, packets and documents by mail. By act of congress of March 3, 1851, Minot's Statute at Large, U. S. 587, it is enacted as follows: 2.-Sec. 1. expense. Home Bancorp's net income for the year ended December 31, 1996, excluding the one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. after-tax charge of $1,077,000 for the recapitalization of the SAIF and excluding the one-time after-tax charge of $512,000 for the termination of the Association's pension plan, was $2,231,000, or $0.35 per share, as compared to net income of $2,364,000 for the year ended December 31, 1995. The decrease of $133,000 was due primarily to the increase in non-interest expense which was partially offset by increases in interest income. The increase in non-interest expense was primarily in compensation and benefits and was the result of normal salary increases and the adoption of the ESOP. The increase in interest income was primarily due to an increase in the average balance of interest earning assets, related primarily to the conversion, which was partially offset by a decrease in average yield on interest earning assets. Asset quality remained strong at December 31, 1996. Non-performing loans A non-performing loan is a loan that is in default or close to being in default. Many loans become non-performing after being in default for 3 months, but this can depend on the contract terms. as a percentage of total loans increased slightly to 0.36% at December 31, 1996 from 0.34% at December 31, 1995. The allowance for loan losses as a percentage of total loans increased to 0.36% at December 31, 1996 from 0.31% at December 31, 1995. The allowance for loan losses as a percentage of non-performing loans increased from 90.17% at December 31, 1995 to 100.85% at December 31, 1996. The Company's loan portfolio is comprised primarily of real estate loans secured by single-family sin·gle-fam·i·ly adj. Relating to or being a dwelling designed for one family only: a single-family home; single-family occupancy. homes in portions of Cook, Kane Kane can refer to: In sports:
Illinois, river, 273 mi (439 km) long, formed by the confluence of the Des Plaines and Kankakee rivers, NE Ill., and flowing SW to the Mississippi at Grafton, Ill. It is an important commercial and recreational waterway. . At December 31, 1996, the Company had total assets of $356.3 million, which included net loans of $261.3 million. Total savings deposits Savings deposits Accounts that pay interest, typically at below-market interest rates, that do not have a specific maturity, and that usually can be withdrawn upon demand. at December 31, 1996 was $251.8 million. The increase in total assets of $51.8 million was primarily due to net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). from the conversion of $68.0 million, which was partially offset by the purchase of $5.6 million of stock by the ESOP, the repayment of $4.0 million of borrowed funds and the disbursement DISBURSEMENT. Literally, to take money out of a purse. Figuratively, to pay out money; to expend money; and sometimes it signifies to advance money. 2. of funds resulting from the decrease in savings deposits of $8.2 million. 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. increased $63.2 million from $36.7 million at December 31, 1995 to $99.9 million at December 31, 1996. The increase was primarily due to the conversion and 1996 net income of $0.6 million. At December 31, 1996, the Association exceeded all of the 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. capital requirements Capital requirements Financing required for the operation of a business, composed of long-term and working capital plus fixed assets. of its primary regulator regulator, n the mechanical part of a gas delivery system that controls gas pressure that allows a manageable flow of drug vapor to escape. regulator see reducing valve. (Office of Thrift Supervision The Office of Thrift Supervision (OTS) was established as a bureau of the Treasury Department in August 1989 as part of a major Reorganization Plan of the thrift regulatory structure mandated by the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) (12 U.S.C.A. ) and had regulatory core and tangible capital ratios each equal to 20.05% and a total risk-based capital ratio Risk-based capital ratio Bank requirement that there be a minimum ratio of estimated total capital to estimated risk-weighted asset. of 41.09%. The Company also announced today that it had established April 17, 1997 as the date of the 1997 Annual Stockholders Meeting. The voting record date has been set as February February: see month. 21, 1997. Home Bancorp of Elgin, Inc., with $356.3 million in assets at December 31, 1996, is the holding company for Home Federal Savings and Loan Association of Elgin, a federally-chartered stock savings and loan association savings and loan association, type of financial institution that was originally created to accept savings from private investors and to provide home mortgage services for the public. The first U.S. savings and loan association was founded in 1831. . Home Federal was established in 1883 and is a community-oriented institution serving the area northwest of Chicago Chicago, city, United States Chicago (shĭkä`gō, shĭkô`gō), city (1990 pop. 2,783,726), seat of Cook co., NE Ill., on Lake Michigan; inc. 1837. through its main office in Elgin, Illinois
TABLES FOLLOW -0-
HOME BANCORP OF ELGIN, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF EARNINGS
For the Three For the Year
Months Ended Ended
December 31, December 31,
1996 1995 1996 1995
____ ____ ____ ____
(In thousands, except per share amounts)
(Unaudited)
INTEREST INCOME
Loans secured by real estate $5,175 $5,380 $20,936 $21,719
Other loans 15 16 56 60
Mortgage-backed securities
held to maturity 3 3 11 15
Investment securities
held to maturity 510 90 780 360
Interest-earning deposits 447 112 1,089 569
FHLB of Chicago stock 47 54 187 202
________ ________ ________ ________
Total interest income 6,197 5,655 23,059 22,925
INTEREST EXPENSE
Savings deposits 2,622 2,752 10,844 10,773
Borrowed funds 0 60 37 77
________ ________ ________ ________
Total interest expense 2,622 2,812 10,881 10,850
________ ________ ________ ________
Net interest income before
provision for loan losses 3,575 2,843 12,178 12,075
Provision for loan losses 30 45 120 180
________ ________ ________ ________
Net interest income after
provision for loan losses 3,545 2,798 12,058 11,895
________ ________ ________ ________
NON-INTEREST INCOME
Service fee income 283 306 1,176 1,129
Gain on sale of real
estate owned 0 0 21 0
Gain on sale of office
properties and equipment 0 0 1 0
Other income 6 5 23 21
________ ________ ________ ________
Total non-interest income 289 311 1,221 1,150
NON-INTEREST EXPENSE
Compensation and benefits 1,156 930 4,907 3,692
Occupancy expense 419 423 1,557 1,608
Federal deposit insurance
premiums 152 174 2,441 709
Advertising and promotion 170 101 440 371
Automated teller machines 90 90 416 314
Data processing 225 225 946 950
Other 423 350 1,513 1,425
________ ________ ________ ________
Total non-interest expense 2,635 2,293 12,220 9,069
________ ________ ________ ________
Income before income tax
expense 1,199 816 1,059 3,976
Income tax expense 468 316 417 1,612
________ ________ ________ ________
Net income $ 731 $500 $642 $2,364
________ ________ ________ ________
________ ________ ________ ________
Earnings per share: Income $0.11 NA $0.10 NA
________ ________ ________ ________
________ ________ ________ ________
HOME BANCORP OF ELGIN, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
Dec. 31, Dec. 31,
1996 1995
____ ____
(In thousands)
(Unaudited)
ASSETS
Cash and due from banks $ 5,661 $ 10,021
Interest-earning deposits 22,341 8,588
Investment securities held-to-maturity 53,786 5,948
Loans receivable, net 261,306 267,153
Government National Mortgage Association
mortgage-backed securities held-to-maturity 142 187
Accrued interest receivable 1,701 1,484
Real estate owned and in judgement,
at lower of cost or fair value 550 496
FHLB of Chicago stock, at cost 2,678 3,056
Office properties and equipment, net 7,564 6,817
Prepaid expenses and other assets 606 770
________ ________
Total assets $356,335 $304,520
________ ________
________ ________
LIABILITIES AND STOCKHOLDERS' EQUITY
Savings deposits $251,795 $259,971
Borrowed funds 0 4,000
Advance payments by borrowers
for taxes and insurance 2,012 1,860
Accrued interest payable and
other liabilities 2,647 2,006
________ ________
Total liabilities $256,454 $267,837
________ ________
________ ________
Stockholders' Equity:
Preferred stock, $.01 par value, 3,000,000
shares authorized; none outstanding $ 0 $ 0
Common stock, $.01 par value; 12,000,000
shares authorized 7,009,250 shares
issued at December 31, 1996 and none
issued at December 31, 1995 70 0
Additional paid-in capital 67,953 0
Retained earnings, substantially restricted 37,325 36,683
Unearned ESOP compensation (5,467) 0
________ ________
Total stockholders' equity 99,881 36,683
________ ________
Total liabilities and stockholders' equity $356,335 $304,520
________ ________
________ ________
HOME BANCORP OF ELGIN, INC.
SELECTED CONSOLIDATED FINANCIAL RATIOS
At or For the At or For the
Three Months Year Ended
Ended Dec. 31, Dec. 31,
1996 1995 1996 1995
____ ____ ____ ____
(Dollars in thousands, except shares and
per share amounts)
(Unaudited)
Selected Financial Ratios(1):
Performance Ratios:
Return on average assets(2) 0.82% 0.66% 0.20% 0.78%
Return on average equity(2) 2.94 5.43 1.11 6.53
Average interest rate spread(3) 3.06 3.54 3.28 3.78
Net interest margin(4) 4.23 3.99 4.02 4.19
Average interest-earning assets
to average interest-bearing
liabilities 137.78% 111.37% 120.29% 111.09%
Non-interest expense to
average assets(2) 2.97 3.05 3.81 2.99
Capital Ratios(1):
Average equity to average assets 28.06 12.25 18.07 11.93
Equity to total assets at
end of period 28.03 12.05 28.03 12.05
Tangible capital(5) 20.05 11.96 20.05 11.96
Core capital(5) 20.05 11.96 20.05 11.96
Total risk-based capital(5) 41.09 23.32 41.09 23.32
Asset Quality Ratios And Other
Data(1):
Total non-performing loans (6) $ 937 $ 916 $ 937 $ 916
Real estate owned, net 550 496 550 496
Non-performing loans to
total loans 0.36% 0.34% 0.36% 0.34%
Non-performing assets to
total assets 0.42 0.46 0.42 0.46
Allowance for loan losses to:
Non-performing loans 100.85 90.17 100.85 90.17
Total loans 0.36 0.31 0.36 0.31
Number of shares outstanding 7,009,250 NA 7,009,250 NA
Book value per share $ 14.25 NA $ 14.25 NA
(1) With the exception of end-of-period ratios, all ratios are based on average monthly balances during the indicated periods and are annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. where appropriate. Capital Ratios and Asset Quality Ratios And Other Data are end-of-period ratios and data (2) Includes one time charge of $1,759,000 ($1,077,000 net of tax effects) associated with the recapitalization of the Savings Association Insurance Fund (the "SAIF") and a loss on termination of pension plan of $837,000 ($512,000 net of tax effects) for the year ended December 31, 1996. Excluding the SAIF recapitalization charge and the loss on termination of the pension plan, the return on average assets and average equity would have been 0.70% and 3.85%, respectively, for the year ended December 31, 1996. Likewise, the ratio of non-interest expense to average assets would have been 3.00% for the year ended December 31, 1996. (3) The average interest rate spread represents the difference between the weighted-average yield on interest-earning assets and the weighted-average cost of interest-bearing liabilities. (4) The net interest margin represents net interest income as a percent of average interest-earning assets. (5) These regulatory capital ratios are for Home Federal Savings and Loan Association of Elgin only. (6) Non-performing loans consist of non-accrual loans; the Company did not have any loans that were 90 days or more past due and still accruing at any of the dates referred to in the table above. CONTACT: Home Bancorp of Elgin, Inc. David G. Towe, 847/742-3800 |
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