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SE Financial Corp. Announces Fiscal 2010 Results

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SE Financial Corp. Announces Fiscal 2010 Results Powered By Docstoc
					SE Financial Corp. Announces Fiscal 2010 Results
December 17, 2010 06:28 PM Eastern Time  

PHILADELPHIA--(EON: Enhanced Online News)--SE Financial Corp. (trading symbol: SEFL) (the “Company”),
the holding company for St. Edmond’s Federal Savings Bank, announced a net loss of $89.6 thousand for the three
months ended October 31, 2010 as compared to net income of $235.1 thousand for the same period last year. For
the twelve months ended October 31, 2010, the Company announced net income of $635.1 thousand compared to
$394.3 thousand for the same period last year.

   l   Total deposits increased $4.9 million for the quarter to $282.4 million at October 31, 2010 from $277.5
       million as of July 31, 2010, representing a 7.02% increase on an annualized basis. The increase was
       comprised of increases in savings, interest bearing checking and non-interest bearing checking accounts of
       $3.1 million, $2.5 million and $1.1 million respectively, offset by a decrease in certificate of deposit accounts
       of $1.9 million.

   l   Despite intense competition in the Greater Philadelphia market, the Bank continues to attract new deposit
       customers and expand existing relationships while adhering to prudent pricing strategy. At October 31, 2010,
       the Bank’s total cost of deposits was 1.38% versus 1.61% at July 31, 2010. This pricing strategy includes
       aggressive re-pricing of maturing certificates of deposit at lower rates, a decrease in rates paid on certain core
       deposit products and a focus on the collection of lower costing, service-sensitive, deposit accounts.
   l   During the quarter, loans receivable decreased $10.9 million to $193.7 million at October 31, 2010, as
       compared to loans receivable of $204.6 million at July 31, 2010. The yield on loans for the quarter ended
       October 31, 2010 decreased 7 basis points to 5.71% as compared to 5.78% for the quarter ended July 31,
       2010 which was attributable to an increase in non-performing assets.
   l   The net interest margin was 2.76% for the quarter ended October 31, 2010 versus 2.90% for the quarter
       ended July 31, 2010. The decrease is due to an increase in cash and cash equivalents resulting from loan
       repayments. Subsequent to quarter end excess cash was used to fund residential loan originations and
       reinvested into investment securities.
   l   The ratio of total non-performing assets to total assets increased to 404 basis points from 334 basis points at
       July 31, 2010. Real estate owned at October 31, 2010 totaled $3.0 million and consisted of one commercial
       real estate property under agreement of sale and three single family residential properties.
   l   The allowance for loan losses to total loans was 146 basis points at October 31, 2010. During the quarter
       ended October 31, 2010 additional provisions totaling $485.1 thousand were recorded due mainly to loan
       risk rating downgrades, trends in delinquency, charge-off history and other qualitative factors used to calculate
       the estimate of the allowance for loan losses. There were charge-offs during the quarter ended October 31,
       2010 totaling $952.7 thousand. The allowance represents management's estimate of the amount necessary to
       cover known and inherent losses in the loan portfolio.
   l   On November 22, 2010 the Board of Directors declared a cash dividend of $.03 per share to stockholders
       of record as of December 6, 2010.

SE FINANCIAL CORP.
UNAUDITED QUARTER HIGHLIGHTS
(Dollars in Thousands)
                      QTR        QTR       $ Increase % Increase
                      10/31/2010 7/31/2010 (Decrease) (Decrease)
Total Assets          321,915 320,577 1,338           0.42%
Investment Securities 59,595     46,087    13,508     29.31%
Loans                 193,727 204,633 (10,906) -5.33%
Deposits              282,359 277,491 4,868           1.75%
Borrowings            13,294     16,786    (3,492)    -20.80%
Equity               25,372        25,444     (72)        -0.28%
Interest Income      3,271         3,526      (255)       -7.23%
Interest Expense     1,186         1,352      (166)       -12.28%
Net Interest Income 2,085          2,174      (89)        -4.09%
Provision            485           696        (211)       -30.32%
Noninterest Income 471             646        (175)       -27.09%
Noninterest Expense 2,284          1,893      391         20.66%
Net Income (Loss) (90)             181        (271)       -149.72%
Net Interest Margin 2.76%          2.90%      -0.14%      -4.83%
Yield on Loans       5.71%         5.78%      -0.07%      -1.21%
Yield on Investments 3.20%         3.93%      -0.73%      -18.58%
Cost of Deposits     1.57%         1.80%      -0.23%      -12.78%
Cost of Borrowings 3.73%           3.66%      0.07%       1.91%

Comparison of the Results of Operations for the Three Months Ended October 31, 2010 and October 31, 2009

For the three-month periods ended October 31, 2010 and 2009, net interest income before provision for loan losses
totaled $2.1 million and $2.2 million, respectively. The decrease of $158 thousand was due to a decrease in the net
interest margin of 34 basis points to 2.76% for the three months ended October 31, 2010 from 3.11% for the three
months ended October 31, 2009 offset somewhat by an increase in the average balance of interest-earning assets of
$13.9 million to $302.7 million for the three months ended October 31, 2010 as compared to $288.8 million for the
three months ended October 31, 2009.

The provision for loan losses increased $145.4 thousand to $485.1 thousand for the three months ended October
31, 2010 versus $339.7 thousand for the three months ended October 31, 2009 due to downgrades and additional
reserves against specific loans in the portfolio.

Non-interest income was $471.2 thousand for the three months ended October 31, 2010 compared to $205.2
thousand for the three months ended October 31, 2009. The increase of $266.0 thousand was due mainly to
increases of $145.6 thousand in gains on sale of investment securities. The quarter ended October 31, 2009
included an other than temporary impairment charge on pooled trust preferred securities totaling $87.9 thousand.

Non-interest expense increased $523.2 thousand to $2.3 million for the three months ended October 31, 2010
compared to $1.8 million for the three months ended October 31, 2009. The increase in non-interest expense was
due mainly to increased losses on sale of REO, professional fees and federal deposit insurance premiums. The loss
on sale of REO for the three months ended October 31, 2010 was $284.4 thousand versus $49.8 thousand for the
same period in the prior year. The $171.0 thousand increase in professional fees is a result of legal fees incurred in
connection with loan workout. The $116.0 thousand increase in federal deposit insurance premiums is a result of the
increased premiums.

Comparison of the Results of Operations for the Twelve Months Ended October 31, 2010 and October 31, 2009

For the twelve month periods ended October 31, 2010 and 2009, net interest income before provision for loan
losses totaled $8.9 million and $8.0 million, respectively. The increase of $890.0 thousand was due to an increase in
the average balance of interest-earning assets of $18.0 million to $296.7 million for the twelve months ended
October 31, 2010 as compared to $278.7 million for the twelve months ended October 31, 2009 and an increase in
the net interest margin of 13 basis points to 3.03% for the twelve months ended October 31, 2010 from 2.90% for
the twelve months ended October 31, 2009.

The provision for loan losses increased $954.3 thousand to $2.0 million for the twelve months ended October 31,
2010 versus $1.1 million for the twelve months ended October 31, 2009 due to downgrades and additional reserves
against specific loans in the portfolio.

Non-interest income was $1.8 million for the twelve months ended October 31, 2010 compared to $548.9
thousand for the twelve months ended October 31, 2009. The increase of $1.2 million was due to increases in gains
on sale of investment securities available for sale and service fees on deposit accounts in the amount of $608.6
thousand and $105.5 thousand respectively in the current year and other than temporary impairment charges on
pooled trust preferred securities posted in the prior year of $470.0 thousand.
Non-interest expense increased $849.3 thousand to $7.8 million for the twelve months ended October 31, 2010
compared to $7.0 million for the twelve months ended October 31, 2009. The increase in non-interest expense was
due mainly to increases in professional fees and federal deposit insurance premiums. The $496.4 thousand increase
in professional fees is a result of legal fees incurred in connection with loan workout. The $250.9 thousand increase
in federal deposit insurance premiums is a result of the increased premiums.

The increase in income tax expense of approximately $56.8 thousand for the twelve months ended October 31,
2010 compared to the same period last year is due to the increase in pretaxable income.

Comparison of Financial Condition at October 31, 2010 and October 31, 2009

Total assets increased $10.2 million to $321.9 million at October 31, 2010 as compared to $311.7 million at
October 31, 2009. Cash and cash equivalents increased $24.1 million to $48.9 million at October 31, 2010 from
$24.8 million at October 31, 2009. Loans receivable decreased $13.7 million to $193.7 million at October 31,
2010 from $207.4 million at October 31, 2009. Deposits increased $25.5 million to $282.4 million at October 31,
2010 from $256.9 million at October 31, 2009. Borrowed money decreased $15.6 million to $13.3 million at
October 31, 2010 from $28.9 million at October 31, 2009 due to maturities of Federal Home Loan Bank
Advances. Stockholders’ equity increased $632.5 thousand to $25.4 million at October 31, 2010 from $24.7
million at October 31, 2009 due mainly to net income of $635.1 offset by dividends paid and a change in
accumulated other comprehensive income (loss).

Company Information

SE Financial Corp. is the holding company for St. Edmond’s Federal Savings Bank, a federally chartered stock
savings institution with six Neighborhood Banking Offices serving South Philadelphia, Roxborough, Ardmore and
Drexel Hill, Pennsylvania and Deptford and Sewell, New Jersey. SE Financial Corp. is incorporated under the laws
of the Commonwealth of Pennsylvania and its executive offices are located at 1901-03 East Passyunk Avenue,
Philadelphia, Pennsylvania 19148. As of October 31, 2010, there were issued and outstanding 2,179,814 shares of
common stock, par value $0.10 per share of SE Financial Corp. Registrar and Transfer Company serves as the
transfer agent for SE Financial Corp. and its address is 10 Commerce Drive, Cranford, New Jersey 07016.

Senior Management: Pamela M. Cyr, President and CEO, J. Christopher Jacobsen, EVP and Chief Operating
Officer, Charles F. Miller, EVP and Chief Lending and Credit Officer, and Caroline H. Doyle, Chief Financial
Officer.

Board of Directors: Marcy C. Panzer (Chairman), Samuel Barsky (Secretary), Charles M. Cahn, Andrew A. Hines,
Megan L. Mahoney, J. W. Parker, Jr., CPA, William F. Saldutti, III, Susanne Spinell Shuster, CPA.

Forward-Looking Statements Disclaimer

This news release contains forward-looking statements as that term is defined in the Private Securities Litigation
Reform Act of 1995. Any statement that is not a historical fact is a forward-looking statement. Such forward-looking
statements are subject to risk and uncertainties, which could cause actual results to differ materially from those
currently anticipated due to a number of factors.

SE FINANCIAL CORP.
Selected Income Statement Data
(Unaudited)
                                               Three Months Ended October         Twelve Months Ended October
(Dollars in thousands except per share data)
                                               31,                                31,
                                                 2010          2009                 2010          2009
Interest income                                $ 3,271       $ 3,846              $ 14,227      $ 15,452
Interest expense                                 1,186         1,603                5,313         7,408
Net interest income                              2,085         2,243                8,914         8,044
Provision for loan losses                        485           340                  2,046         1,092
Net interest income after provision for loan
                                                 1,600           1,903              6,868           6,952
losses
Noninterest income                            471           205                          1,780          549
Noninterest expense                           2,284         1,760                        7,827          6,978
Income before taxes                           (213      ) 348                            821            523
Income tax expense                            (123      ) 113                            186            129
Net (loss) income                           $ (90       ) $ 235                        $ 635          $ 394
Weighted average shares outstanding - basic
                                              1,907,681     1,881,050                   1,900,517       1,875,666
and diluted (1)
Income per share - basic and diluted (1)      ($0.05    ) $ 0.12                       $ 0.33         $ 0.21
                                                  Three Months Ended October           Twelve Months Ended October
Performance Ratios (Unaudited)
                                                  31,                                  31,
                                                   2010          2009                   2010          2009
Return on average assets (2)                       -0.11     % 0.31        %            0.20      % 0.13        %
Return on average equity (2)                   -1.40     % 3.84                 %       2.51         % 1.64         %
Net interest margin on average interest
                                               2.76      % 3.11                 %       3.03         % 2.90         %
earning assets (2)(3)
Selected Balance Sheet Data (Unaudited)
(Dollars in thousands except per share data) October 31,                               October 31,
                                               2010                                      2009
Assets                                       $ 321,915                                 $ 311,667
Loan receivable, net                           193,727                                   207,410
Cash and cash equivalents                      48,876                                    24,812
Investment securities                          59,595                                    63,355
Deposits                                       282,359                                   256,905
FHLB borrowings                                13,294                                    28,872
Total stockholders' equity                     25,372                                    24,740
                           (1)                 1,911,059                                 1,884,451
Ending shares outstanding
Book value per share (1)                            13.28                             13.09
Stockholders' equity to total assets                7.88                            % 7.93                              %
Asset Quality (Unaudited)
(Dollars in thousands)                            October 31,                        October 31,
                                                    2010                               2009
Non-performing assets (4)                         $ 12,998                           $ 4,406
Allowance for losses                                2,820                              2,116
Non-performing assets to total assets               4.04                            % 1.42                    %
Allowance for losses to total loans                 1.46                            % 1.02                    %
Allowance for losses to non-performing
                                                21.70                        % 48.03                          %
assets
    Shares outstanding does not include unreleased ESOP shares, unearned nonvested RSP shares, or shares held in
(1) the Stock Compensation Trust for purposes of the weighted average shares outstanding calculation and the
    ending shares outstanding calculation.
(2) Annualized for the three months ended October 31, 2010 and 2009.
(3)   The yield on municipal securities has been adjusted to a tax-equivalent basis.
(4)   Non-performing assets include non-accrual loans and real estate owned.

Contacts
SE Financial Corp.
Pamela M. Cyr
President and CEO
215-468-1700

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Description: PHILADELPHIA--(EON: Enhanced Online News)--SE Financial Corp. (trading symbol: SEFL) (the “Company”), the holding company for St. Edmond’s Federal Savings Bank, announced a net loss of $89.6 thousand for the three months ended October 31, 2010 as compared to net income of $235.1 thousand for the same period last year. For the twelve months ended October 31, 2010, the Company announced net income of $635.1 thousand compared to $394.3 thousand for the same period last year. Total deposits increase a st
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