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Abington Savings Bank reports results for third quarter and nine months ended Sept. 30, 1995.

ABINGTON, Mass.--(BUSINESS WIRE)--Nov. 10, 1995--Abington Savings Bank (NASDAQ:ABBK) today announced results for the third quarter and nine months ended Sept. 30, 1995.

The bank recognized a net loss for the quarter ended Sept. 30, 1995 of $668,000 or $.36 per share compared to net income of $684,000 or $.35 per share for the same period a year earlier. Net income for the nine months ended Sept. 30, 1995 was $640,000 or $.33 per share compared to $2,006,000 or $1.03 per share for the same period a year earlier. The loss for the third quarter is due primarily to a net loss on the sale of loans of $1,654,000 which is attributable to the bank's recent decision to sell approximately $9.2 million of non-performing and certain other loans at a discount. In addition, the bank also recognized a loss on other real estate owned amounting to $225,000 during the quarter ended Sept. 30, 1995. The loan sale is expected to close during the fourth quarter of 1995.

During October 1995, the bank's management and board of directors evaluated the feasibility of a sale, at a discount, of a group of approximately $9.2 million of loans. These loans consist of approximately $5.7 million of loans which were nonperforming at Sept. 30, 1995 and certain other loans which, although performing, required a higher than average level of management attention.

The bank entered into a definitive agreement with a third party to sell the loans, and expects to consummate the transaction during the fourth quarter of 1995. As a result, at Sept. 30, 1995, these loans have been reflected on the bank's balance sheet as loans held for sale. The loans will be sold at approximately 64 percent of par, which will result in a pre-tax loss of approximately $1,654,000. The loss on the sale of these loans is reflected in the bank's consolidated income statements for the three months and nine months ended Sept. 30, 1995 as an addition to the provision for loan losses. After giving effect to the loan sale, the bank's nonperforming assets are expected to be approximately $1.6 million, consisting of $500,000 of nonperforming loans and $1.1 million of other real estate owned (OREO).

James P. McDonough, the bank's president and chief executive officer, commented, "In deciding to proceed with the loan sale, the Board of Directors and management carefully evaluated the bank's nonperforming and other high-maintenance loans. While the bank has made tremendous progress over the past several years in working out problem assets, we found that a number of our borrowers were continuing to have difficulty despite somewhat improved economic conditions. We concluded that certain nonperforming and other high- maintenance loans would continue to occupy significant management time and could entail additional cost and lost income on an ongoing basis. It also appeared to be a favorable market in which to sell non-performing loans. In light of these factors, we decided to take advantage of the opportunity to sell a significant portion of the bank's nonperforming assets. We look forward to devoting more time and attention to new loan business."

McDonough added that when the additional provision for loan loss of $1,654,000 and OREO losses of $225,000 are netted out of the financial results net income would have been $679,000 or $.35 per share and $1,987,000 or $1.02 per share, for the quarter and nine months ended Sept. 30, 1995, respectively. "The restructuring to the bank's loan portfolio which is reflected in the third quarter of 1995 operating results has pointed the organization in a direction which management and the board of directors believe will allow earnings in future quarters to reach greater levels given efficiencies which will be recognized as a result of the loan sale." McDonough noted that future earnings reaching increased levels will be a key ingredient toward creating greater value for the bank's shareholders.

At Sept. 30, 1995, assets totaled $441,893,000 compared to $421,833,000 at Dec. 31, 1994. Total outstanding net loans and deposits at Sept. 30, 1995 were $233,248,000 and $275,381,000, respectively, compared with $235,439,000 and $246,843,000, respectively at Dec. 31, 1994. Stockholders' equity at Sept. 30, 1995 was $29,682,000, reflecting a stockholders' equity to assets ratio of 6.7 percent. Book value per common share at Sept. 30, 1995 was $15.82. The results for the quarter and nine months ended Sept. 30, 1995 reflect the acquisition of certain assets and liabilities of a branch office in Holbrook, Mass. on June 23, 1995. The deposits acquired amounted to approximately $16 million.

Abington Savings Bank is a Massachusetts-chartered savings bank whose deposits are insured by the Federal Deposit Insurance Corp. and the Depositors Insurance Fund. In addition to its headquarters and loan center in Abington, the bank has six other branches in Halifax, Holbrook, Hull, Kingston, Pembroke and Whitman. -0-
 Abington Savings Bank
 Operating Results
 (In thousands, except per share data)

 Three Months Ended
 Sept. 30,
 1995 1994

Interest and dividend income $8,037 $7,213
Net interest income 3,422 3,367
Provision for possible loan losses 1,804 150
Non-interest income 567 542
Non-interest expenses 3,111 2,619
Income (loss) before income taxes (926) 1,140
Net income (loss) (668) 684
Earnings (loss) per share $ (.36) $ .35
Dividends per share $ .10 $ .10
Weighted average shares outstanding 1,876,000 1,981,000

 Nine Months Ended
 Sept. 30,
 1995 1994

Interest and dividend income $23,456 $19,459
Net interest income 10,169 9,305
Provision for possible loan losses 2,104 460
Non-interest income 1,998 1,804
Non-interest expenses 8,890 7,548
Income before income taxes 1,173 3,101
Net income 640 2,006
Earnings per share $ .33 $ 1.03
Dividends per share $ .30 $ .30
Weighted average shares outstanding 1,959,000 1,958,000

 Balance Sheet Data
 (In thousands, except per share data)

 Sept. 30, Dec. 31,
 1995 1994

Total assets $441,893 $421,833
Loans, net 233,248 235,439
Allowance for loan losses 1,417 2,845
Deposits 275,381 246,843
Stockholders' equity 29,682 28,366
Book value per share $ 15.82 15.13
Shares outstanding 1,876 1,875

CONTACT: Abington Savings Bank

Edward J. Merritt, 617/982-3271
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Publication:Business Wire
Date:Nov 10, 1995
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