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INDIANA FEDERAL CORPORATION REPORTS RECORD SECOND QUARTER EARNINGS

 VALPARAISO, Ind., July 21 /PRNewswire/ -- Indiana Federal Corporation, parent company of Indiana Federal Bank for Savings, today reported record net income of $1.7 million or 51 cents per share, for the second quarter ended June 30 1993, compared to net income of $1.3 million or 41 cents per share for the same period in 1992.
 Earnings for the six months ended June 30, 1993, were also a record $3.3 million or $1.00 per share compared to net income of $3.1 million or 94 cents per share for the same period last year. Included in net income for the six months ended June 30, 1992, was a non-recurring adjustment of $250,000 or 8 cents per share for the cumulative effect of changing to a different method of accounting for income taxes.
 Peter R. Candela, president and chief executive officer said, "Our continued good earnings are the result of our favorable net interest margins, mortgage loan demand and substantial improvements in non-performing assets."
 For the quarter ended June 30 1993, net interest after provision for loan losses, the company's core business was $5.0 million or a 10.7 percent increase from the $4.5 million recorded for the same period in 1992. Net interest income after provision for loan losses for the six month period ended June 30, 1993, increased by 9.6 percent to $10.0 million for $9.1 million for the same period last year. The increase in net interest income was primarily the result of lower interest rates and the purchase of $49.0 million of FHLMC 15 year fixed-rate mortgage-backed securities which were funded with $37.5 million of three and five year callable FHLB advances and $10.0 million of short term borrowings. The net interest margin (net interest income divided by average interest-earning assets) for the six months ended June 30, 1993, was 3.53 percent compared to 3.57 percent for the same period last year.
 Other income increased by 43 percent to $913,000 for the three months ended June 30, 1993, from $638,000 for the same period last year. For the six months ended June 30, 1993, other income increased by 17.8 percent to $1.7 million from $1.4 million for the same period last year. The increase in other income was primarily the result of positive operating results from real estate owned properties, higher loan servicing fee income and increased gains on sale of mortgage loans.
 Operating expenses increased by 14.2 percent to $3.4 million for the three months period ended June 30, 1993, from $3.0 million for the same period last year. For the six months ended June 30, 1993, operating expenses increased by 11.7 percent to $6.7 million from $6.0 million for the same period last year. The increase in operating expenses was primarily due to the opening of our Highland/Munster full-service banking center, the addition of our commercial banking division, and to normal salary increases.
 Non-performing assets declined substantially to $9.4 million or 1.44 percent of assets at June 30, 1993, from $14.3 million or 2.38 percent of assets at Dec. 31. 1992. The improvement in non-preforming assets was primarily a result of a decline of $700,000 in delinquent loans and the reclassification of $3.8 million of restructured loans which have been current for at least twelve months and have current market interest rates.
 At June 30, 1993, total assets were $650.1 million, up 15.8 percent on an annualized basis from $602.4 million at year end 1992. Shareholders' equity increase to $61.7 million or $19.52 per share at June 30, 1993, compared to $18.98 per share at year end 1992. The return on average shareholders' equity increased to 10.80 percent for the six months ended June 30, 1993, compared to 9.89 percent for the same period last year.
 Indiana Federal Corporation's wholly-owned subsidiary, Indiana Federal Bank for Savings, maintains a network of nine full service offices in Northwest Indiana and loan production offices in Valparaiso, Highland and South Bend, Indiana. Indiana Federal Corporation shares are traded on the NASDAQ National Market System under the symbol ``IFSL.''
 INDIANA FEDERAL CORPORATION
 Selected Financial Data
 ($ in thousands except per share amount)
 Three Months Ended Six Months Ended
 June 30, June 30,
 1993 1992 1993 1992
 Net income before cumulative
 effect of a change in
 accounting principles $ 1,663 $1,347 $3,274 $2,819
 Cumulative effect of changing
 methods of acounting
 for Income Taxes -- -- -- 250
 Net income after cumulative
 adjustment 1,663 1,347 3,274 3,069
 Earnings per share before
 cumulative effect of a change
 in accounting principles .51 .41 1.00 .86
 Cumulative effect per share of
 changing methods of accounting
 for Income Taxes -- -- -- .08
 Net income after
 cumulative adjustment .51 .41 1.00 .94
 Cash dividends per share .20 .15 .40 .30
 Weighted average number of
 shares outstanding (000's) 3,166 3,186 3,165 3,188
 June 30, Dec. 31, June 30,
 1993 1992 1992
 Assets $ 650,100 $ 602,400 $ 573,900
 Net loans 399,900 397,200 399,900
 Investment securities 46,900 60,500 82,100
 Mortgage backed securities 140,400 93,300 48,200
 Deposits 432,100 416,100 428,300
 FHLB advances & other
 borrowings 151,200 121,300 81,300
 Shareholders' equity 61,700 59,800 58,000
 Return on average assets 1.05% 1.08% 1.03%
 Return on average equity 10.80% 10.78% 10.33%
 Operating expenses to
 average assets 2.15% 2.16% 2.07%
 Reserves to loans
 receivable ratio 1.18% 1.11% .95%
 Non-performing assets to
 total assets ratio 1.44% 2.38% 2.52%
 Equity to assets ratio 9.49% 9.93% 10.10%
 Book value per common share $ 19.52 $ 18.98 $ 18.26
 Shares outstanding, net of
 treasury stock (000's) 3,161 3,152 3,173
 Net interest margin 3.53% 3.65% 3.57%
 -0- 7/21/93
 /CONTACT: Peter R. Candela, President/CEO of Indiana Federal Bank, 219-465-6607/
 (IFSL)


CO: Indiana Federal Corporation ST: Indiana IN: FIN SU: ERN

DH -- NY020 -- 3786 07/21/93 09:13 EDT
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Date:Jul 21, 1993
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