SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange act 1934
January 22, 2019
(Date of report/date of earliest event reported)
CONSUMERS BANCORP, INC.
(Exact name of registrant as specified in its charter)
| OHIO | 033-79130 | 34-1771400 |
| (State or other jurisdiction | (Commission File Number) | (I.R.S. Employer Identification No.) |
| of incorporation or organization) |
614 East Lincoln Way
P.O. Box 256
Minerva, Ohio 44657
(Address of principal executive offices)
(330) 868-7701
(Issuer’s telephone number)
N/A
(Former name of former address, if changes since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐
Item 2.02 Results of Operations and Financial Condition
On January 22, 2019, Consumers Bancorp, Inc. issued a press release reporting its results for the second fiscal quarter ended December 31, 2018. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
Item 9.01 Financial Statements and Exhibits
d. Exhibits
| Exhibit No. | Description |
| 99.1 | Press Release of Consumers Bancorp, Inc. dated January 22, 2019. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Consumers Bancorp, Inc. | ||
| Date: January 22, 2019 | /s/ Ralph J. Lober, II | |
| Ralph J. Lober, II President and Chief | ||
| Executive Officer |
Exhibit 99.1
Consumers Bancorp, Inc. Reports:
|
● |
Net income increased by $1.2 million, or 181.4%, to $1.8 million for the three-month period ended December 31, 2018 compared with the same period last year |
|
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Net income increased by $1.9 million, or 122.1%, to $3.5 million for the six-month period ended December 31, 2018 compared with the same period last year |
|
● |
Total loans increased by $15.1 million, or an annualized 9.5%, for the six-month period ended December 31, 2018 compared to June 30, 2018 |
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● |
Total deposits increased by $12.6 million, or an annualized 5.8%, for the six-month period ended December 31, 2018 compared to June 30, 2018 |
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● |
Net recoveries of $806 thousand were collected during the six-month period ended December 31, 2018 |
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● |
Non-performing loans to total loans declined to 0.27% at December 31, 2018 |
Minerva, Ohio— January 22, 2019 (OTCQB: CBKM) Consumers Bancorp, Inc. (Consumers) reported net income of $1.8 million for the second fiscal quarter of 2019, an increase of $1.2 million from the same period last year. Earnings per share for the second fiscal quarter of 2019 were $0.68 compared to $0.24 for the same period last year. Net income for the second fiscal quarter of 2019 was positively impacted by a negative provision for loan loss expense of $775 thousand primarily as a result of net recoveries of $806 thousand that were collected during the three months ended December 31, 2018.
For the six months ended December 31, 2018, net income was $3.5 million an increase of $1.9 million, or 122.1%, from the same period last year. Net income for the 2019 fiscal year was positively impacted by a negative provision for loan loss expense of $775 thousand and a net gain on sale of securities of $560 thousand. In addition, net income was positively impacted by a $960 thousand, or 12.4%, increase in net interest income which was the result of a $38.9 million increase in average interest-earning assets from the prior year period combined with an increase on the yield on interest-earning assets.
Assets at December 31, 2018 totaled $518.0 million, an increase of $15.3 million, or an annualized 6.1%, from June 30, 2018. Loans increased by $15.1 million, or an annualized 9.5%, and deposits increased by $12.6 million, or an annualized 5.8% from June 30, 2018.
“While a full principal recovery of a prior period commercial real estate loss and a securities gain associated with a previously written down holding are reflected in strong three- and six-month results, we believe improvements in other core factors are contributing to asset growth and profitability, said Ralph J. Lober, II, President and Chief Executive Officer. “Our business bankers, mortgage originators, and retail staff across our markets continue to identify opportunities and win business by clearly defining and delivering on the community bank difference. These efforts are reflected in a $40.0 million, or 13.6%, increase in gross loans outstanding over the twelve months ending December 31, 2018, and a 12.4% increase in net interest income. Further, residential mortgage production for the six months ended December 31, 2018 increased 41% over the same year earlier period. We continue to enhance sales processes as well as internal and customer facing technology to drive new business and efficiencies. Strong economic activity and employment levels are reflected in record low nonaccrual and loan delinquencies; however, the flattening yield curve has lessened the expected increase in net interest income and margin,” he noted.
The net interest margin was 3.63% for the quarter ended December 31, 2018 and was 3.61% for the quarter ended December 31, 2017. The Corporation’s yield on average interest-earning assets was 4.20% for the three months ended December 31, 2018, an increase from 3.94% for the same period last year. The Corporation’s cost of funds was 0.79% for the three months ended December 31, 2018 and 0.46% for the same period last year.
Other income increased by $105 thousand to $944 thousand for the second quarter of fiscal year 2019 compared with $839 thousand for the same period last year. The increase in other income for the second quarter of fiscal year 2019 was primarily a result of increases in gain on sale of mortgage loans and debit card interchange income. These increases were partially offset by a $27 thousand loss from the sale of securities.
Other expenses increased by $320 thousand, or 9.0%, for the second fiscal quarter of 2019 from the same period last year. The increase in other expenses was primarily the result of an increase in salary and benefit expenses and marketing expenses.
Non-performing loans were $900 thousand at December 31, 2018, $1.1 million at June 30, 2018 and $865 thousand at December 31, 2017. The allowance for loan losses (ALLL) as a percent of total loans at December 31, 2018 was 1.07% and net recoveries totaled $806 thousand for the six months ended December 31, 2018. The ALLL to loans ratio was 1.10% at December 31, 2017 and annualized net charge-offs to total loans were 0.01% for the six-month period ended December 31, 2017.
Consumers provides a complete range of banking and other investment services to businesses and clients through its fourteen full service locations and one loan production office in Carroll, Columbiana, Jefferson, Stark, Summit and Wayne counties in Ohio. Information about Consumers National Bank can be accessed on the internet at http://www.consumersbank.com.
The information contained in this press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may involve risks and uncertainties that are difficult to predict, may be beyond Consumers’ control and could cause actual results to differ materially from those described in such statements. Although Consumers believes that the expectations reflected in such forward-looking statements are reasonable, Consumers can give no assurance that such expectations will prove to be correct. Important factors that could cause actual results to differ materially from those suggested by these forward-looking statements and that could adversely affect Consumers’ performance include, but are not limited to: changes in general economic, political, or industry conditions; uncertainty in U.S. fiscal and monetary policy, including the interest rate policies of the Federal Reserve Board; volatility and disruptions in global capital and credit markets; movements in interest rates; competitive pressures on product pricing and services; success, impact, and timing of our business strategies; the nature, extent, timing, and results of governmental actions; and other factors that may affect our future results. The forward-looking statements included in this discussion speak only as of the date they are made, and, except as required by law, Consumers undertakes no obligation to update these forward-looking statements to reflect subsequent events or circumstances.
Contact: Ralph J. Lober, President and Chief Executive Officer 1-330-868-7701 extension 1135.
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Consumers Bancorp, Inc. Consolidated Financial Highlights |
|
(Dollars in thousands, except per share data) |
Three Month Periods Ended |
Six Month Periods Ended |
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|
Consolidated Statements of Income |
Dec. 31, 2018 |
Dec. 31, 2017 |
Dec. 31, 2018 |
Dec. 31, 2017 |
||||||||||||
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Total interest income |
$ | 5,063 | $ | 4,291 | $ | 9,958 | $ | 8,434 | ||||||||
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Total interest expense |
689 | 364 | 1,285 | 721 | ||||||||||||
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Net interest income |
4,374 | 3,927 | 8,673 | 7,713 | ||||||||||||
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Provision for loan losses |
(775 | ) | 60 | (660 | ) | 150 | ||||||||||
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Other income |
944 | 839 | 2,439 | 1,711 | ||||||||||||
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Other expenses |
3,880 | 3,560 | 7,564 | 6,953 | ||||||||||||
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Income before income taxes |
2,213 | 1,146 | 4,208 | 2,321 | ||||||||||||
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Income tax expense |
364 | 489 | 686 | 735 | ||||||||||||
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Net income |
$ | 1,849 | $ | 657 | $ | 3,522 | $ | 1,586 | ||||||||
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Basic and diluted earnings per share |
$ | 0.68 | $ | 0.24 | $ | 1.29 | $ | 0.58 | ||||||||
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Consolidated Statements of Financial Condition |
December 31, 2018 |
June 30, 2018 |
December 31, 2017 |
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Assets |
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Cash and cash equivalents |
$ | 9,749 | $ | 7,772 | $ | 9,141 | ||||||
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Certificates of deposit in other financial institutions |
2,473 | 2,973 | 3,921 | |||||||||
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Securities, available-for-sale |
143,833 | 144,028 | 135,738 | |||||||||
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Securities, held-to-maturity |
3,824 | 4,024 | 4,061 | |||||||||
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Federal bank and other restricted stocks, at cost |
1,459 | 1,459 | 1,425 | |||||||||
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Loans held for sale |
1,068 | 1,448 | 814 | |||||||||
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Total loans |
333,562 | 318,509 | 293,594 | |||||||||
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Less: allowance for loan losses |
3,569 | 3,422 | 3,225 | |||||||||
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Net loans |
329,993 | 315,087 | 290,369 | |||||||||
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Other assets |
25,556 | 25,828 | 24,813 | |||||||||
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Total assets |
$ | 517,955 | $ | 502,619 | $ | 470,282 | ||||||
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Liabilities and Shareholders’ Equity |
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Deposits |
$ | 442,530 | $ | 429,963 | $ | 382,989 | ||||||
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Other interest-bearing liabilities |
24,699 | 25,123 | 39,695 | |||||||||
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Other liabilities |
3,830 | 3,772 | 3,427 | |||||||||
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Total liabilities |
471,059 | 458,858 | 426,111 | |||||||||
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Shareholders’ equity |
46,896 | 43,761 | 44,171 | |||||||||
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Total liabilities and shareholders’ equity |
$ | 517,955 | $ | 502,619 | $ | 470,282 | ||||||
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At or For the Six Month Periods Ended |
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Performance Ratios: |
December 31, 2018 |
December 31, 2017 |
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Return on Average Assets (Annualized) |
1.38 | % | 0.67 | % | ||||||||
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Return on Average Equity (Annualized) |
15.71 | 7.09 | ||||||||||
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Average Equity to Average Assets |
8.75 | 9.44 | ||||||||||
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Net Interest Margin (Fully Tax Equivalent) |
3.69 | 3.62 | ||||||||||
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Market Data: |
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Book Value to Common Share |
$ | 17.15 | $ | 16.18 | ||||||||
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Dividends Paid per Common Share (YTD) |
0.26 | 0.245 | ||||||||||
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Period End Common Shares |
2,733,845 | 2,729,644 | ||||||||||
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Asset Quality: |
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Net Charge-offs (Recoveries) to Total Loans (Annualized) |
(0.48 | )% | 0.01 | % | ||||||||
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Non-performing Assets to Total Assets |
0.17 | % | 0.20 | |||||||||
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ALLL to Total Loans |
1.07 | 1.10 | ||||||||||