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Eagle Bancorp Announces Year End Earnings, Fourth Quarter Earnings and Increases Quarterly Cash Dividend HELENA, Mont., July 17, 2008 (PRIME NEWSWIRE) -- Eagle Bancorp
(``Eagle'') (OTC BB:EBMT.OB - News), the stock holding company of American
Federal Savings Bank (the ``Bank''), reported net income of
$2,110,000, or $1.97 per share ($1.74 per share diluted),
for the year ended June 30, 2008, and announced an increased
cash dividend of $0.255 per share. These earnings represent
an increase of $332,000, or 18.7%, compared to $1,778,000
for the year ended June 30, 2007. Earnings for the quarter
ended June 30, 2008 were $889,000, or $0.83 per share ($0.73
per share diluted), an increase of 101.13% compared to $442,000
for the quarter ended June 30, 2007. Eagle's quarterly cash dividend of $0.255 per share for the fourth quarter of Eagle's fiscal year represents an increase of $0.015 per share, or 6.25%, over the previous quarter's dividend. The dividend is payable August 22, 2008 to shareholders of record at the close of business on August 1, 2008. ``We are pleased with our strong growth in assets and to again increase the dividend to our stockholders. Also, our asset quality remains very strong during a period when other parts of the country are experiencing a difficult lending environment,'' said CEO Peter Johnson. The increase in net income for the year ended June 30, 2008 was the result of an increase in net interest income of $751,000 offset by a decrease in noninterest income of $37,000 and an increase in noninterest expense of $449,000. Eagle's tax provision was $108,000 higher in 2008. Eagle's return on assets was 0.80% and its return on equity was 8.49%, compared with 0.76% and 7.63%, respectively, for the year ended June 30, 2007. The decrease in noninterest income of $37,000 for the year ended June 30, 2008 was due to a recognized loss on Freddie Mac and Fannie Mae preferred stock of $511,000 that is accounted for under Statement of Financial Accounting Standard (SFAS) No. 159 ``Fair Value Option for Financial Assets and Financial Liabilities''. Eagle implemented SFAS on July 1, 2007. The preferred stock of Freddie Mac and Fannie Mae currently held by the company constitutes $1.321 million or 0.47 percent of total assets as of June 30, 2008. This stock continues to demonstrate high price volatility and could negatively impact future earnings of the Company. The increase in net income of $447,000 for the fourth quarter was the result of an increase in net interest income of $442,000 along with an increase in noninterest income of $164,000 offset by an increase in noninterest expense of $170,000. Eagle's tax provision was $164,000 higher in the current quarter. Eagle's fourth quarter annualized return on assets was 1.30% and its annualized return on equity was 13.83%, compared with 0.73% and 7.30%, respectively, for the same quarter in 2007. Total interest and dividend income increased $425,000 to $3.713 million for the quarter ended June 30, 2008 from $3.288 million for the quarter ended June 30, 2007. This was due primarily to increases in interest and fees on loans of $203,000 and interest on securities available-for-sale of $222,000. Total interest expense decreased $17,000 to $1.598 million for the quarter ended June 30, 2008 from $1.615 million for the quarter ended June 30, 2007. Interest on deposits decreased $208,000 while interest on borrowings increased $193,000. The favorable economic conditions in the southwestern Montana markets where the Bank conducts its principal operations enabled Eagle to reduce its allowance for loan loss by $175,000 at the end of the quarter ended June 30, 2008. During the year, Eagle's asset quality has been very strong. For example, its portfolio of first lien 1-4 family mortgages experienced little or no delinquencies during the year. In addition, asset quality in the other loan categories remains strong. This has been reflected in low loan delinquencies and loss rates over the past several years. Likewise, the economy in Montana in general and more specifically in southwest Montana has continued to be robust unlike other parts of the country. Montana's unemployment remains low at 4.2 percent, as reported by the Bureau of Labor Statistics at the end of May 2008 and only 3.2 percent for Lewis and Clark County where a majority of the Bank's loans are located. Thus far the difficulties in other markets with regard to housing have not been felt as acutely in the Bank's markets. RealtyTrac(r) ranks Montana 46th among all states for single family residential foreclosures at the end of June 2008. Total assets increased $35.22 million, or 14.39%, to $279.91 million at June 30, 2008 from $244.69 million at June 30, 2007. Loans receivable increased $16.01 million, or 10.12%, to $174.15 million from $158.14 million. Investment securities available-for-sale increased to $78.42 million from $64.77 million. Deposits decreased $800 thousand, or 0.45%, to $178.85 million from $179.65 million. Advances and other borrowings increased $34.42 million, or 101.84%, to $68.22 million from $33.80 million. Total stockholders' equity increased $1.54 million, or 6.42%, to $25.63 million at June 30, 2008 from $24.09 million at June 30, 2007. This was the result of net income for the period of $2.110 million and by a decrease in accumulated other comprehensive loss of $86,000 (mainly due to a decrease in net unrealized loss on securities available-for-sale). These were partially offset by treasury stock purchases and dividends paid. American Federal Savings Bank was formed in 1922 and is headquartered in Helena, Montana. It has additional branches in Butte, Bozeman and Townsend. Eagle's common stock trades on the OTC Bulletin Board under the symbol ``EBMT.'' Eagle is a subsidiary of Eagle Financial MHC, a federal mutual holding company formed in 2000, which owns approximately 60.3% of Eagle Bancorp's common stock. This release may contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and is including this statement for purposes of these safe harbor provisions. Financial highlights for Eagle Bancorp follow.
EAGLE BANCORP AND SUBSIDIARY
(consolidated)
(Dollars in Thousands)
June 30, June 30,
2008 2007
(Unaudited) (Audited)
ASSETS
Cash and due from banks 3,541 2,709
Interest-bearing deposits with banks 549 360
-------- --------
Total cash and cash equivalents 4,090 3,069
Investment securities FAS 159, at market value 1,321 0
Investment securities available-for-sale, at
market value 78,417 64,774
Investment securities held-to-maturity, at cost 697 921
Investment in nonconsolidated subsidiary 155 155
Federal Home Loan Bank stock, at cost 1,715 1,315
Mortgage loans held-for-sale 1,370 1,175
Loans receivable, net of deferred loan fees and
allowance for loan losses of $300 at June 30,
2008 and $518 at June 30, 2007 174,149 158,140
Accrued interest and dividends receivable 1,426 1,333
Mortgage servicing rights, net 1,652 1,628
Property and equipment, net 8,080 5,806
Cash surrender value of life insurance 6,285 5,764
Real estate acquired in settlement of loans,
net of allowance for losses 0 0
Other assets 550 606
-------- --------
Total assets 279,907 244,686
======== ========
LIABILITIES
Deposit accounts:
Noninterest bearing 14,617 13,694
Interest bearing 164,233 165,953
-------- --------
Total deposits 178,850 179,647
Federal Funds Purchased 3,000 3,800
Advances from Federal Home Loan Bank and
Other Borrowings 65,223 30,000
Long-Term Subordinated Debentures 5,155 5,155
Accrued expenses and other liabilities 2,045 1,996
-------- --------
Total liabilities 254,273 220,598
EQUITY
Preferred stock (no par value, 1,000,000 shares
authorized, none issued or outstanding)
Common stock (par value $0.01 per share;
9,000,000 shares authorized; 1,223,572 shares
issued; 1,076,072 and 1,084,357 shares
outstanding at June 30, 2008 and June 30,
2007, respectively) 12 12
Additional paid-in capital 4,487 4,387
Unallocated common stock held by employee stock
ownership plan ("ESOP") (55) (92)
Treasury stock, at cost (147,500 and 139,215
shares at June 30, 2008 and June 30, 2007,
respectively) (5,013) (4,759)
Retained earnings 27,025 25,448
Accumulated other comprehensive (loss) income (822) (908)
-------- --------
Total equity 25,634 24,088
Total liabilities and equity 279,907 244,686
======== ========
EAGLE BANCORP AND SUBSIDIARY
Consolidated Statements of Income
(In Thousands, except for Per Share Data)
Three Months Ended Twelve Months Ended
June 30, June 30,
(unaudited) (unaudited)
------------------------ ------------------------
2008 2007 2008 2007
----------- ----------- ----------- -----------
Interest and
Dividend Income:
Interest and
fees on loans $ 2,736 $ 2,533 10,905 $ 9,731
Interest on
deposits with
banks 9 11 63 50
Securities
held-to-
maturity 8 10 34 43
Securities
available-for-
sale 953 731 3,071 2,820
FHLB dividends 7 3 16 7
----------- ----------- ----------- -----------
Total
interest
and
dividend
income 3,713 3,288 14,089 12,651
----------- ----------- ----------- -----------
Interest Expense:
Deposits 935 1,143 4,387 4,191
Advances and
other borrowings 588 395 1,966 1,466
Subordinated
debentures 75 77 300 309
----------- ----------- ----------- -----------
Total
interest
expense 1,598 1,615 6,653 5,966
----------- ----------- ----------- -----------
Net Interest
Income 2,115 1,673 7,436 6,685
Loan loss
provision (175) 0 (175) 0
----------- ----------- ----------- -----------
Net interest
income after
loan loss
provision 2,290 1,673 7,611 6,685
----------- ----------- ----------- -----------
Noninterest
income:
Net gain on sale
of loans 255 181 801 643
Demand deposit
service charges 164 119 711 496
Mortgage loan
servicing fees 136 128 542 533
Net gain on sale
of available-for-
sale securities 0 0 72 (4)
Net gain (loss)
on securities
FAS 159 38 0 (511) 0
Other 159 160 609 593
----------- ----------- ----------- -----------
Total
noninterest
income 752 588 2,224 2,261
----------- ----------- ----------- -----------
Noninterest
expense:
Salaries and
employee
benefits 1,013 922 3,965 3,617
Occupancy
expenses 136 127 537 537
Furniture and
equipment
depreciation 71 71 281 287
In-house computer
expense 77 75 297 286
Marketing expense 108 51 293 247
Amortization of
mtg servicing
fees 89 90 313 305
Federal
insurance
premiums 5 5 20 21
Postage 20 22 99 86
Legal,accounting,
and examination
fees 51 54 220 232
Consulting fees 44 23 116 79
ATM processing 16 14 56 49
Other 217 223 866 868
----------- ----------- ----------- -----------
Total
noninterest
expense 1,847 1,677 7,063 6,614
----------- ----------- ----------- -----------
Income before
provision for
income taxes 1,195 584 2,772 2,332
----------- ----------- ----------- -----------
Provision for
income taxes 306 142 662 554
----------- ----------- ----------- -----------
Net income $ 889 $ 442 $ 2,110 $ 1,778
=========== =========== =========== ===========
Basic earnings
per share $ 0.83 $ 0.41 $ 1.97 $ 1.66
=========== =========== =========== ===========
Diluted earnings
per share $ 0.73 $ 0.37 $ 1.74 $ 1.47
=========== =========== =========== ===========
Weighted average
shares
outstanding
(basic eps) 1,069,027 1,072,745 1,070,600 1,072,823
=========== =========== =========== ===========
Weighted average
shares
outstanding
(diluted eps) 1,215,912 1,211,312 1,214,186 1,209,586
=========== =========== =========== ===========
Contact: Eagle Bancorp
Peter J. Johnson, President and Chief Executive Officer
(406) 457-4006
Clint J. Morrison, Senior Vice President and Chief
Financial Officer
(406) 457-4007
Source: Eagle Bancorp
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