SI Financial Group, Inc. Reports Results for the Quarter and Six Months Ended June 30, 2005.WILLIMANTIC
SIFI Seismic Induced Frame Instability ), the holding company of Savings Institute Bank and Trust Company (the "Bank"), reported net income of $845,000, or $0.07 basic and 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. earnings per common share, for the quarter ended June June: see month. 30, 2005 versus net income of $392,000 for the quarter ended June 30, 2004. Net income for the six months ended June 30, 2005 was $1.7 million, or $0.14 basic and diluted earnings per common share, compared to $1.2 million for the six months ended June 30, 2004. The increase in net income was primarily due to increases in net interest and dividend income and noninterest income, offset by an increase in noninterest expenses. Per share data is not presented for the three months and the six months ended June 30, 2004, as the Company had no shares outstanding prior to the Company's initial public offering on September September: see month. 30, 2004. For the three months and the six months ended June 30, 2005, net interest and dividend income increased 16.8% to $5.4 million from $4.6 million and increased 16.9% to $10.7 million from $9.1 million, respectively, compared to the same periods in the prior year. Net interest and dividend income rose primarily due to an increase in the average balance of interest-earning assets, offset by an increase in the 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. for both periods presented of 2005. The provision for loan losses totaled $130,000 for the second quarter of 2005, representing a decrease of $20,000 over the same period in 2004. The provision for loan losses decreased $65,000 for the first half of 2005 compared to the same period in the prior year. The lower provision reflects a high quality loan portfolio, as evidenced by a $531,000, or 35.9%, reduction in the Bank's nonperforming loans and net recoveries from loan losses of $75,000 for the six months ended June 30, 2005 compared to net charge-offs of $21,000 for the six months ended June 30, 2004. Noninterest income was $1.6 million for the quarter ended June 30, 2005 compared to $1.1 million for the quarter ended June 30, 2004, mainly due to an increase in service fees of $403,000 resulting from the expansion of the Bank's deposit-related products. To a lesser extent, noninterest income included a gain of $72,000 from the sale of real property. Noninterest income was $3.0 million for the first half of 2005 compared to $2.3 million for the same period of 2004. Contributing to the rise in noninterest income were increases primarily related to service fees of $561,000 and net gains on the sale of loans of $167,000, offset by lower realized gains Realized Gain A gain resulting from selling an asset at a price higher than the original purchase price. Notes: There may be tax consequences for a realized profit. on the sale of available for sale securities of $151,000. The net gain on the sale of loans for 2005 resulted from the sale of $31.6 million of predominately fixed-rate residential mortgage loans. Higher loan sales in 2005 reflect the Bank's initiative to mitigate mit·i·gate v. To moderate in force or intensity. mit  i·ga tion n. interest rate risk and to manage
liquidity in a rising interest rate environment.Noninterest expenses were $5.6 million for the quarter ended June 30, 2005 compared to $5.0 million for the quarter ended June 30, 2004, principally as a result of increases in compensation costs, professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. and marketing expenses of $540,000, $213,000 and $83,000, respectively, offset by a decrease in occupancy costs Occupancy costs are the whole life costs of buildings and their associated land from occupancy until disposal. These costs may be incurred on a regular or irregular basis. Occupancy costs are those costs related to occupying a space including; rent, real estate taxes, personal of $251,000. Marketing costs increased in the second quarter of 2005 in response to an aggressive marketing campaign. Occupancy costs were higher in the second quarter of 2004 due to an impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charge of $337,000 recorded to reduce the carrying value Carrying Value Also know as "book value," it is a company's total assets minus intangible assets and liabilities, such as debt. Notes: This is different than market value, as it can be higher or lower depending on the circumstances. on a former branch facility to its estimated net market value. Noninterest expenses increased $1.4 million for the six months ended June 30, 2005. For both the three months and the six months ended June 30, 2005, the increase in compensation costs primarily reflects additional salaries, benefits and taxes for elevated staffing levels in response to the expansion of branch facilities and the commercial lending division and amortization of share-based compensation awards. Additionally, the increase in professional services resulted from higher legal and auditing costs associated with the Company's public reporting requirements. Total assets grew $33.3 million, representing a 5.3% increase, to $657.9 million at June 30, 2005 from $624.6 million at December December: see month. 31, 2004. Contributing to the increase in assets at June 30, 2005 were increases of $26.3 million in loans receivable, $4.4 million in investment securities and $2.6 million in other assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. . The increase in loans receivable reflects strong 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. , offset by increased loan sales over the prior year. Increases in investment securities consisted primarily of shorter-term U.S. government and agency obligations and corporate debt securities. The rise in other assets resulted from an increase in capital expenditures associated with branch expansion during the first six months of 2005. Total liabilities were $576.2 million at June 30, 2005 compared to $543.8 million at December 31, 2004. Deposits increased $26.9 million, or 5.9%, from year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. , reflecting a rise in NOW and money market accounts and certificates of deposit. Borrowings increased from $79.9 million at December 31, 2004 to $86.5 million at June 30, 2005, resulting from an increase in FHLB FHLB Federal Home Loan Bank advances used to fund loan demand and to invest in securities yielding greater returns than the cost of borrowings. Total 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 $971,000 from $80.8 million at December 31, 2004 to $81.8 million at June 30, 2005. The increase in equity related primarily to current year's earnings of $1.7 million, offset by an increase of $348,000 in unrealized losses Unrealized Loss A loss that results from holding onto an asset rather than cashing it in and officially taking the loss. Notes: Let's say you own a stock that is down 50%, but you haven't sold it to realize the loss yet. This is said to be an unrealized loss. on available for sale securities (net of taxes) and a decrease of $112,000 related to stock options and restricted share awards granted under the Company's new equity incentive plan, which received shareholder approval during the second quarter of 2005. The Company's investment securities portfolio, which includes primarily U.S. government and agency obligations and mortgage-backed securities Mortgage-backed securities (MSBs) Securities backed by a pool of mortgage loans. , was unfavorably affected by market rates, and resulted in higher unrealized losses on available for sale securities for the period. As previously announced, the Company declared a cash dividend of $0.03 per outstanding common share, at a total cost of $158,000, on June 23, 2005 to be paid on or about July July: see month. 29, 2005 to shareholders of record as of July 8, 2005. The total amount of the dividend reflects SI Bancorp, MHC's, the Company's mutual holding company parent, waiver The voluntary surrender of a known right; conduct supporting an inference that a particular right has been relinquished. The term waiver is used in many legal contexts. of receipt of its dividend. The Company continues to utilize its proceeds from the initial public offering to invest in loans and securities, branch expansion and the development of the Company's infrastructure and employees. The Bank recently opened its sixteenth branch office in Tolland, Connecticut Tolland is a town in Tolland County, Connecticut, United States. The population was 13,146 at the 2000 census. Tolland was named in May, 1715, and incorporated in May, 1722. and 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. its branch in Stonington, Connecticut The Town of Stonington is in New London County, Connecticut in the southeastern corner of that U.S. state. It includes the borough of Stonington, the villages of Pawcatuck and Wequetequock, and the eastern half of the village of Mystic (the other half being in the town of Groton). . The Bank anticipates the opening of new branch locations in South Windsor, Connecticut South Windsor is a town in Hartford County, Connecticut, United States. The population is 24,412 (2000 census). Geography According to the United States Census Bureau, the town has a total area of 74.2 km² (28.7 mi²). 72.4 km² (28.0 mi²) of it is land and 1.8 km² (0. during the second half of 2005 and East Lyme, Connecticut East Lyme is a town in New London County, Connecticut, United States. The population was 18,118 at the 2000 census. The latitude of East Lyme is 41.353N. The longitude is -72.23W. Geography According to the United States Census Bureau, the town has a total area of 108. in early 2006. "We are pleased with the success of both our Stonington Stonington (stōn`ĭngtən), town (1990 pop. 16,919), New London co., extreme SE Conn., on a peninsula jutting into Long Island Sound; settled 1649 from Plymouth, inc. 1662. and Tolland Tolland is the name of some places:
Savings Institute Bank and Trust Company is headquartered in Willimantic, Connecticut Connecticut, state, United States Connecticut (kənĕt`ĭkət), southernmost of the New England states of the NE United States. It is bordered by Massachusetts (N), Rhode Island (E), Long Island Sound (S), and New York (W). , with sixteen offices in eastern Connecticut. The Bank continues to explore other locations for further expansion. The Bank is a full service community-oriented financial institution dedicated to servicing the financial service needs of consumers and businesses within its market area. This release contains "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. " which may describe future plans and strategies, including our expectations of future financial results. Management's ability to predict results or the effect of future plans or strategies is inherently uncertain. Among the factors that could affect our actual results include market interest rate trends, the general regional and national economic market, our ability to control costs and expenses, our ability to operate new branch offices profitably, actions by our competitors and their pricing, loan 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 changes in federal and state regulation. As we have no control over any of these factors, they should be considered in evaluating any forward-looking statements and undue reliance should not be placed on such statements. Except as required by applicable law or regulation, SI Financial Group, Inc. disclaims any obligation to update such forward-looking statements.
SELECTED FINANCIAL CONDITION DATA:
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June 30, December 31,
(Dollars In Thousands / Unaudited) 2005 2004
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ASSETS
Noninterest-bearing cash and due from banks $ 18,860 $ 21,647
Interest-bearing cash and cash equivalents 11,946 9,128
Investment securities 129,268 124,870
Loans held for sale - 200
Loans receivable, net 474,241 447,957
Cash surrender value of life insurance 7,698 7,561
Other assets 15,922 13,286
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Total assets $ 657,935 $ 624,649
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LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Deposits $ 484,696 $ 457,758
Borrowings 86,529 79,891
Other liabilities 4,930 6,191
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Total liabilities 576,155 543,840
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Stockholders' equity 81,780 80,809
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Total liabilities and stockholders'
equity $ 657,935 $ 624,649
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SELECTED OPERATIONS DATA:
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Three Months Ended Six Months Ended
June 30, June 30,
(Dollars In Thousands, Except --------- ---------
Per Share Data / Unaudited) 2005 2004 2005 2004
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Interest and dividend income $ 8,192 $ 6,903 $16,084 $13,686
Interest expense 2,824 2,307 5,416 4,557
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Net interest and dividend
income 5,368 4,596 10,668 9,129
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Provision for loan losses 130 150 235 300
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Net interest and dividend income
after provision for loan losses 5,238 4,446 10,433 8,829
Noninterest income 1,629 1,069 2,956 2,304
Noninterest expenses 5,611 4,958 10,805 9,391
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Income before provision for
income taxes 1,256 557 2,584 1,742
Provision for income taxes 411 165 837 546
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Net income $ 845 $ 392 $ 1,747 $ 1,196
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Earnings per common share:
Basic $ 0.07 N/A $ 0.14 N/A
Diluted $ 0.07 N/A $ 0.14 N/A
Weighted-average common shares
outstanding:
Basic 12,087,104 N/A 12,083,278 N/A
Diluted 12,095,709 N/A 12,093,218 N/A
SELECTED FINANCIAL RATIOS:
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At or For the At or For the
Three Months Six Months
Ended Ended
June 30, June 30,
--------- ---------
(Dollars in Thousands) 2005 2004 2005 2004
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Selected Performance Ratios:(1)
Return on average assets 0.53 % 0.29 % 0.56 % 0.45 %
Return on average equity 4.16 4.51 4.33 6.91
Interest rate spread 3.26 3.46 3.30 3.52
Net interest margin 3.61 3.63 3.64 3.68
Efficiency ratio(2) 80.36 87.55 79.51 83.50
Asset Quality Ratios:
Allowance for loan losses $3,510 $2,967
Allowance for loan losses as a
percent of total loans 0.74 % 0.72 %
Allowance for loan losses as a
percent of nonperforming loans 369.47 200.34
Nonperforming loans $950 $1,481
Nonperforming loans as a percent of
total loans 0.20 % 0.36 %
Nonperforming assets(3) $950 $1,749
Nonperforming assets as a percent
of total assets 0.14 % 0.32 %
(1) Quarterly ratios have been annualized.
(2) Represents noninterest expense divided by the sum of net
interest income and noninterest income, less any realized gains
or losses on the sale of securities.
(3) Nonperforming assets consist of nonperforming loans and other
real estate owned.
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