Home Financial Bancorp Announces Fourth
Quarter and Year-End Results
August 10, 2010 11:13 AM Eastern Daylight Time
SPENCER, Ind.--(EON: Enhanced Online News)--Home Financial Bancorp (“Company”) (OTCBB: HWEN), an
Indiana corporation which is the holding company for Owen Community Bank, s.b., (“Bank”) based in Spencer,
Indiana, announces unaudited results for the fourth quarter and twelve months ended June 30, 2010.
Fourth Quarter Highlights:
l Net interest income increased 11%, or $79,000;
l Repossessed property expense fell 50%, or $70,000;
l Net income improved to $107,000, from negative $33,000.
Twelve Month Highlights:
l Shareholders’ equity totaled $8.0 million, or 11% of total assets;
l Net interest income rose 10%, or $279,000;
l Non-interest expense eased 7%, or $222,000;
l Net income improved from $149,000 to $430,000.
For the quarter ended June 30, 2010, the Company reported $107,000, or $.08 basic and diluted earnings per
common share. For the same period last year, the Company reported a net loss of $33,000, or $.03 basic and
diluted loss per common share. Lower repossessed property costs, including loan loss provisions, and improved net
interest income produced better fourth quarter results.
Net interest income before provisions for loan losses grew $79,000 or 11% for the three months ended June 30,
2010, compared to the same period in 2009. Interest income for the quarter was down $11,000, but was more than
offset by a $90,000, or 21% drop in interest expense due to extremely low market interest rates.
Provisions for loan losses declined $28,000, or 19% to $121,000 in fourth quarter 2010. Net loan losses totaled
$133,000, compared to $118,000 for the same period a year earlier. A regular analysis of the allowance for loan
losses indicated the reserve was adequately funded at June 30, 2010. This analysis included reviewing changes in
volume, composition and quality of the loan portfolio, as well as actual loan loss experience.
Non-interest income increased 26% to $207,000, compared to $164,000 for the year-earlier period. This
improvement primarily resulted from recognized gain on sale of real estate acquired for development. Non-interest
expense decreased $106,000 or 13%. Accounting for most of this change, repossessed property expense lowered
to $70,000, compared to $140,000 for the quarter ended June 30, 2009.
For the twelve-month period ended June 30, 2010, net income increased to $430,000, or $.33 basic and diluted
earnings per common share, compared to $149,000 or $.11 basic and diluted earnings per common share for fiscal
2009. Lower interest expense and less repossessed property expense significantly contributed to improved earnings
compared to fiscal 2009.
Net interest income before the provision for loan losses rose $279,000 or 10%, to $3.0 million for the year. Interest
income fell $168,000 or 4%, but was more than offset by a $447,000 or 23% decline in interest expense for the
year. Loan loss provisions increased to $381,000, compared to $375,000 the prior year. Net charge-offs
decreased to $317,000 for fiscal year 2010, compared to $354,000 for 2009.
Non-interest income grew $85,000 or 11%, to $854,000 for fiscal 2010. Most of this change is tied to a $72,000
increase in gain on sale of investment securities. Non-interest expense fell $223,000 or 7%. Repossessed property
expense, including net loss on sale of foreclosed property, fell $136,000 or 41%, to $194,000 for the year. Also
contributing to the overall decrease in non-interest expense, computer processing expense and legal and professional
fees were lower compared to 2009.
Tax expense increased $299,000 for 2010, compared to a year earlier. In addition to greater before tax income,
higher tax expense reflects the expiration of investment tax credits in June 2009. Tax credits reduced tax expense by
$107,000 in 2009.
At June 30, 2010, total assets were $72.2 million compared to $69.9 million at June 30, 2009. During the twelve
months ended June 30, 2010, loans outstanding increased $354,000. Accounting for most of the growth in assets,
investment securities available for sale increased to $3.7 million, from $1.4 million a year earlier.
Loans delinquent 90 days or more decreased 10% to $2.4 million, or 4.1% of total loans at June 30, 2010. A year
earlier, non-performing loans amounted to $2.6 million or 4.6% of total loans. Total non-performing assets fell to
$3.3 million or 4.5% of total assets. Twelve months earlier, non-performing assets totaled $3.4 million or 4.8% of
total assets. Non-performing assets included $896,000 in real estate owned (“REO”) and other repossessed
properties at June 30, 2010, compared to $733,000 at June 30, 2009.
The allowance for loan losses increased 10% to $677,000, compared to $613,000 at June 30, 2009. Loan loss
allowances were 1.17% of total loans at June 30, 2010 and 1.07% of total loans a year earlier. Periodic provisions
to allowances for loan losses reflect management’s view of risk in the Company’s entire loan portfolio due to a
number of dynamic factors, including current economic conditions, quantity of outstanding loans, and loan
delinquency trends. Management considered the level of allowances for loan losses at June 30, 2010 to be adequate
to cover probable incurred losses inherent in the loan portfolio at that date.
At June 30, 2010, deposits grew 9% to $47.2 million, from $43.3 million twelve months earlier. Total borrowings
decreased to $16.5 million at June 30, 2010, compared to $18.5 million a year earlier.
Shareholders’ equity was $8.0 million or 11.1% of total assets at June 30, 2010. The Company’s book value per
share was $5.92 based on 1,350,605 shares outstanding. Factors impacting shareholder equity during fiscal 2010
included net income, four quarterly cash dividends totaling $.12 per share, $11,000 net increase in unrealized gain on
securities available for sale, and a $34,000 decrease in costs associated with a stock-based employee benefit plan.
During the twelve months ended June 30, 2010, the Company repurchased 2,321 shares of its stock in open market
Home Financial Bancorp and Owen Community Bank, s.b., an FDIC-insured, federal stock savings bank, operate
from headquarters in Spencer, Indiana, and a branch office in Cloverdale, Indiana. Additional information concerning
Home Financial Bancorp and its subsidiaries is available at www.hfbancorp.com or www.owencom.com.
HOME FINANCIAL BANCORP
Consolidated Financial Highlights
(Dollars in thousands, except per share and book value amounts)
FOR THREE MONTHS ENDED JUNE 30: 2010 2009
Net Interest Income $775 $696
Provision for Loan Losses 121 149
Non-interest Income 207 164
Non-interest Expense 704 810
Income Tax 50 (66 )
Net Income 107 (33 )
Basic and Diluted (Loss) Earnings Per Share: $ .08 $ (.03 )
Average Shares Outstanding - Basic 1,316,438 1,312,556
Average Shares Outstanding - Diluted 1,316,438 1,312,820
FOR TWELVE MONTHS ENDED JUNE 30: 2010 2009
Net Interest Income $2,961 $2,682
Provision for Loan Losses 381 375
Non-interest Income 854 769
Non-interest Expense 2,784 3,007
Income Tax 219 (80 )
Net Income 430 149
Basic and Diluted Earnings Per Share: $ .33 $ .11
Average Shares Outstanding - Basic 1,313,788 1,311,314
Average Shares Outstanding - Diluted 1,313,902 1,312,070
June 30, June 30,
Total Assets $72,232 $69,851
Total Loans 57,783 57,429
Allowance for Loan Losses 677 613
Total Deposits 47,218 43,266
Borrowings 16,500 18,500
Shareholders’ Equity 8,001 7,695
Non-Performing Assets 3,259 3,368
Non-Performing Loans 2,363 2,635
Non-Performing Assets to Total Assets 4.51 % 4.82 %
Non-Performing Loans to Total Loans 4.09 % 4.59 %
Book Value Per Share* $5.92 $5.69
*Based on 1,350,605 Shares at June 30, 2010 and 1,352,926 Shares at June 30, 2009.
Home Financial Bancorp
Kurt D. Rosenberger, 812-829-2095