Printer Friendly

FINANCIAL SECURITY CORP. ANNOUNCES THIRD QUARTER EARNINGS

 CHICAGO, Oct. 22 /PRNewswire/ -- Financial Security Corp. (NASDAQ-NMS: FNSC), the holding company for Security Federal Savings and Loan Association, today announced earnings for the third quarter ending Sept. 30, 1993. Net income was $773,000 for the three months ending Sept. 30, 1993, as compared to $572,000 for the comparable period in 1992, an increase of $201,000, or 35.1 percent. For the nine months ended Sept. 30, 1993, net income before cumulative effect of a change in accounting for taxes was $1.79 million, as compared to $1.31 million, an increase of $480,000, or 36.6 percent. The cumulative effect of the change in accounting for taxes in 1993 increased net income by an additional $1,508,000.
 Earnings per share before cumulative effect of the change in accounting for taxes amounted to 47 cents for the third quarter of 1993 and $1.07 for the nine months ended Sept. 30, 1993. For the nine months ended Sept. 30, 1993, earnings per share amounted to $1.97, after the cumulative effect of the change in accounting for taxes. Earnings per share have been determined by dividing net income for the periods by the weighted average number of shares outstanding. Earnings per share information for the prior year period is not meaningful as the company did not complete its conversion from mutual to stock ownership until Dec. 29, 1992.
 Comparison of Operating Results for the Quarter and Nine-Months
 Ended Sept. 30, 1993 and 1992
 For the quarter ended Sept. 30, 1993, total interest income amounted to $4.7 million, a decrease of $500,000, or 9.6 percent, as compared to $5.2 million for the same period in 1992. For the nine months ended Sept. 30, 1993, total interest income amounted to $14.1 million, a decrease of $1.4 million, or 9.7 percent, as compared to $15.5 million for the same period in 1992. The decrease in interest income is the direct result of lower interest rates on loan originations, investment securities and the refinancing of existing loans.
 Total interest expense decreased $500,000, or 18.5 percent, to $2.2 million for the quarter ended Sept. 30, 1993, as compared to $2.7 million for the comparable period in 1992. For the nine months ended Sept. 30, 1993, interest expense decreased $1.7 million, or 20.7 percent, to $6.5 million, as compared to $8.2 million for the comparable period in 1992. This decrease is due to a reduction in the cost of funds to 4.19 percent at Sept. 30, 1993, from 4.67 percent at Dec. 31, 1992.
 The company's loss provisions for the quarter ended Sept. 30, 1993, amounted to $250,000 as compared to $450,000 in 1992, a decrease of $200,000, or 44.4 percent. For the nine months ended Sept. 30, 1993, total loss provisions amounted to $1.0 million, as compared to $1.4 million in 1992, a decrease of $400,000, or 28.6 percent.
 This reduction reflects management's determination to maintain adequate reserves while reducing non-performing assets. As of Sept. 30, 1993, non-performing assets totaled $14.6 million, as compared to $16.6 million at Dec. 31, 1992. This represents a decrease of $2.0 million, or 12.0 percent, from December 1992. As of Sept. 30, 1993, the association's valuation allowances amounted to 52.1 percent of non-performing loans, as compared to 39.2 percent as of Dec. 31, 1992, and 35.5 percent of non-performing assets, as compared to 23.1 percent as of Dec. 31, 1992.
 Non-interest income for the third quarter of 1993 remained unchanged at $343,000, as compared to the comparable period in 1992. For the nine months ended Sept. 30, 1993, non-interest income decreased $85,000, or 13.9 percent, to $525,000 from $610,000 in 1992. This decrease was due primarily to a decrease in unrealized gains on investments of $161,000 and an increase in loss on sale of foreclosed real estate of $71,000, which were partially offset by non-recurring, non-operating income of $133,000. All other sources of non-interest income increased by $14,000.
 Non-interest expense for the quarter ended Sept. 30, 1993, amounted to $1.4 million, as compared to $1.3 million for the comparable quarter in 1992. This increase was due primarily to an increase in E.S.O.P and RRP compensation of $99,000.
 For the nine months ended Sept. 30, 1993, non-interest expense amounted to $4.3 million, as compared to $3.7 million, an increase of $600,000, or 16.2 percent.
 This increase was due to increases in E.S.O.P. and RRP compensation expense of $300,000, occupancy expense of $23,000, professional fees of $112,000, loss from foreclosed real estate operations of $70,000 and loss on sale of foreclosed real estate of $88,000.
 Income tax expense for the quarter and nine-month period ended Sept. 30, 1993, amounted to $490,000 and $999,000 respectively, as compared to $616,000 and $1,314,000 in 1992, or decreases of $126,000 (20.5 percent) and $446,000 (30.7 percent). The decreases are primarily the result of a change in the method of calculating income tax expense due to the adoption of SFAS. No. 109 as of Jan. 1, 1993.
 Comments on Statement of Condition
 During the nine month period ended Sept. 30, 1993, total assets increased $8.7 million to $247.2 million from $238.5 million, or 3.6 percent. Loans receivable increased $14.3 million to $176.9 million from $162.6 million, or 8.8 percent. Investment securities decreased $11.3 million, or 29.5 percent, to $27.0 million from $38.3 million. Investments in mortgage backed securities increased $4.5 million, or 26.2 percent, to $21.7 million from $17.2 at Dec. 31, 1992. The changes in asset composition reflect the movement from lower rate securities to higher yielding mortgage loans.
 Non-performing assets totaled $14.6 million at Sept. 30, 1993, as compared to $16.6 million as of Dec. 31, 1992. This represents a decrease of $2.0 million, or 12.0 percent. Non-performing assets, as a percentage of total assets, as of Sept. 30, 1993, were 5.91 percent, as compared to 6.96 percent as of Dec. 31, 1992. Non-performing loans as a percentage of total loans as of Sept. 30, 1993, amounted to 4.48 percent as compared to 5.74 percent. Loan loss allowances as a percentage of non-performing loans were 52.1 percent as of Sept. 30, 1993, as compared to 39.2 percent as of Dec. 31, 1992.
 Total deposits increased $4.3 million, or 2.18 percent, to $201.6 million as of Sept. 30, 1993, as compared to $197.3 million as of Dec. 31, 1992.
 Stockholders' equity totaled $37.1 million, or 15.0 percent of assets, as of Sept. 30, 1993, an increase of $2.3 million, or 6.61 percent, from $34.8 million at Dec. 31, 1992. The increase resulted from net income of $3.3 million plus payments of $.3 million from employee stock plans which were partially offset by Treasury Stock purchases.
 Security Federal Savings and Loan Association is a community- oriented thrift offering traditional deposit and mortgage loan products. It operates from a single office located at 1209 N. Milwaukee Ave., Chicago, Ill., 60622.
 Financial Security Corp. is publicly traded on the NASDAQ under the symbol of FNSC.
 Comments on consolidated statements of financial condition, selected financial ratios and results of operations follow:
 FINANCIAL SECURITY CORP.
 Selected Financial Information
 (Dollars in Thousands Except Stockholders' Equity Per Share Data)
 Sept. 30, 1993 Dec. 31, 1992
 (Unaudited)
 Financial Condition Highlights:
 Total assets $247,246 $238,458
 Loans receivable-net 176,927 162,627
 Mortgage-backed securities 21,716 17,200
 Investment securities 27,042 38,327
 Deposits 201,617 197,323
 Borrowed funds 4,532 1,160
 Stockholders equity 37,119 34,791
 Stockholders equity per share $22.73 $20.24
 Selected Asset Quality Ratios:
 Non-performing loans to total loans 4.5 pct. 5.7 pct.
 Non-performing assets to total assets 5.9 pct. 6.9 pct.
 Allowance for losses to non-performing loans 52.1 pct. 39.2 pct.
 Allowances for losses to non-performing
 assets 35.5 pct. 23.1 pct.
 Consolidated Statement of Income
 Sept. 30, 1993
 (Dollars in thousands, except earnings per share data)
 Three Months Ended Nine Months Ended
 Sept. 30, Sept. 30,
 1993 1992 1993 1992
 Income:
 Interest income $4,741 $5,221 $14,135 $15,489
 Interest expense 2,171 2,659 6,544 8,245
 Net interest income before
 provision for loan losses 2,570 2,562 7,591 7,244
 Provision for losses 250 450 1,000 1,350
 Non-Interest income 343 343 525 610
 Non-Interest expense 1,400 1,267 4,328 3,745
 Income before income tax
 expense 1,263 1,188 2,788 2,759
 Income tax expense 490 616 999 1,445
 Net income before cumulative
 effect of a change in
 accounting principle 773 572 1,789 1,314
 Cumulative effect to Jan. 1,
 1993 of change in the method
 of calculating income tax
 expense 0 0 1,508 0
 Net income $ 773 $ 572 $3,297 $1,314
 Net earnings per share before
 cumulative effect of a change
 in accounting principal $0.47 N/A $1.07 N/A
 Cumulative effect to Jan. 1,
 1993 of change in the method
 of calculating income tax
 expense 0 N/A $0.90 N/A
 Net earnings per share $0.47 N/A $1.97 N/A
 Average shares
 outstanding 1,633,288 N/A 1,677,217 N/A
 -0- 10/22/93
 /CONTACT: William C. Preissner, CFO of Financial Security Corp., 312-227-7020/
 (FNSC)


CO: Financial Security Corp. ST: Illinois IN: FIN SU: ERN

TW -- NY054 -- 5814 10/22/93 14:48 EDT
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Oct 22, 1993
Words:1658
Previous Article:TRANSAMERICAN WASTE INDUSTRIES REPORTS YEAR-END RESULTS
Next Article:TRIAD GUARANTY ANNOUNCES INITIAL PUBLIC OFFERING
Topics:

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters