UNITED STATES
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 of 1934
Date of Report (Date of earliest event reported): January 19, 2017
UNITED BANCSHARES, INC.
(Exact name of Registrant as specified in its Charter)
Ohio | 333-86453 | 34-1516518 | ||
(State or other jurisdiction of incorporation) | (Commission File No.) | (IRS Employer Identification Number) | ||
100 S. High Street, Columbus Grove, Ohio | 45830-1241 | |||
(Address of principal executive offices) | (Zip Code) | |||
Registrant’s telephone number, including area code: |
| (419) 659-2141 | ||
N/A
(Former name or former address, if changed 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):
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition.
On January 19, 2017, United Bancshares, Inc. issued an earnings release announcing its financial results for the quarter and year ended December 31, 2016. A copy of the earnings release (Exhibit 99.1) and unaudited financial information (Exhibit 99.2) are attached.
The information in this Item 2.02, including Exhibit 99.1 and Exhibit 99.2 furnished herewith, is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that Section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933 (the “Securities Act”) or the Exchange Act, except as otherwise stated in such filing.
Item 7.01 Regulation FD Disclosure.
On January 19, 2017, United Bancshares, Inc. issued an earnings release announcing its financial results for the quarter and year ended December 31, 2016 and that its Board of Directors increased its dividend by 9.01% compared to the prior quarter, approving a cash dividend of $0.12 per common share payable March 15, 2017 to shareholders of record at the close of business on February 28, 2017. A copy of the release (Exhibit 99.1) and unaudited financial information (Exhibit 99.2) are attached.
The information in this Item 7.01, including Exhibit 99.1 and Exhibit 99.2 furnished herewith, is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that Section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act or the Exchange Act, except as otherwise stated in such filing.
Item 8.01 Other Events
On January 19, 2017, United Bancshares, Inc. issued a release announcing that its Board of Directors increased its dividend by 9.01% compared to the prior quarter, approving a cash dividend of $0.12 per common share payable March 15, 2017 to shareholders of record at the close of business on February 28, 2017. A copy of the release (Exhibit 99.1) is attached.
The information in this Item 8.01, including Exhibit 99.1 furnished herewith, is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that Section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act or the Exchange Act, except as otherwise stated in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. | Description | ||||||||
99.1 | Release dated January 19, 2017 | ||||||||
99.2 | Unaudited Financial Information | ||||||||
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 thereunto duly authorized.
United Bancshares, Inc. | ||||||
Date: January 19, 2017 | By: /s/ Brian D. Young | |||||
Brian D. Young President and Chief Executive Officer | ||||||
Exhibit 99.1
On January 19, 2017, United Bancshares, Inc. issued the following release:
United Bancshares, Inc. (Nasdaq: UBOH – news), a bank holding company headquartered in Columbus Grove, Ohio with consolidated assets of $633.1 million today announced operating results for the quarter and year ended December 31, 2016 and that its Board of Directors increased its dividend by 9.01% compared to the prior quarter, approving a cash dividend of $0.12 per common share payable March 15, 2017 to shareholders of record at the close of business on February 28, 2017.
For the quarter ended December 31, 2016, the Corporation reported net income of $1,500,000, or $0.46 basic earnings per share, an increase of $111,000 (8.0%). This compares to the fourth quarter of 2015 net income of $1,389,000, or $0.42 basic earnings per share. The increase in operating results for the fourth quarter of 2016 as compared to the same period in 2015 was primarily attributable to a $332,000 favorable change in the provision (credit) for loan losses and a $119,000 increase in other non-interest income, offset by a decrease in net interest income of $243,000 and an increase in the provision for income taxes of $119,000. The decrease in net interest income was largely attributable to less loan discount accretion relating to the November 2014 Ohio State Bank (OSB) acquisition. The increase in non-interest income was largely attributable to an increase in fair value of mortgage servicing rights.
Net income for the year ended December 31, 2016 totaled $5,521,000, or $1.68 basic earnings per share compared to $5,917,000 or $1.77 basic earnings per share for the year ended December 31, 2015. Compared with the year ended December 31, 2015, net income decreased $396,000, or 6.7%. The decrease in operating results for the year ended December 31, 2016 as compared to the year ended December 31, 2015 was primarily attributable to a decrease in net interest income of $1,363,000 and an increase in non-interest expenses of $92,000, offset by an increase in non-interest income of $266,000 and an increase in income taxes of $339,000, as well as a credit for loan losses of $750,000 in 2016 compared to a $382,000 provision in 2015.
The Corporation recognized a $50,000 credit, or negative provision, for loan losses for the fourth quarter of 2016 and a $750,000 credit for the year ended December 31, 2016, compared to a $282,000 provision for loan losses for the fourth quarter of 2015 and a $382,000 provision for the year ended December 31, 2015. The allowance for loan losses as a percentage of total loans decreased to 0.89% at December 31, 2016 compared to 1.08% at December 31, 2015.
For the quarter ended December 31, 2016, non-interest income was $1,433,000, compared to $1,314,000 for the fourth quarter of 2015, a $119,000 (9.0%) increase. For the year ended December 31, 2016, non-interest income was $4,903,000 compared to $4,637,000 in 2015, a $266,000 (5.7%) increase. The increase in non-interest income was mainly attributable to increases in net demand deposit account service charges and Non-Sufficient funds & Overdraft charges as well as the impact of the change in fair value of mortgage servicing rights.
For the quarter ended December 31, 2016, non-interest expenses were $4,412,000, compared to $4,435,000 for the fourth quarter of 2015, a $23,000 (0.5%) decrease. For the year ended December 31, 2016, non-interest expenses totaled $17,784,000, compared to $17,692,000 for the year ended December 31, 2015, an increase of $92,000 (0.5%). The increase in non-interest expenses for the year ended December 31, 2016 was primarily attributed to increases in salary & benefits expense, premises and equipment expense, advertising & promotion, media, loan closing fees, ATM processing fees, and IT expense offset by decreases in data processing expense, FDIC Assessment, consultant fees, Ohio financial institutions tax, other real estate owned expense and asset management legal expense.
Total assets amounted to $633.1 million at December 31, 2016, compared to $608.7 million at December 31, 2015, an increase of $24.4 million (4.0%). The increase in total assets was primarily the result of increases of $22.3 million (6.4%) in net loans and leases and $7.3 million (4.0%) in available-for-sale securities, offset by a decrease in cash of $8.7 million (38.1%). Deposits during this same period increased $6.3 million, or 1.2%.
Shareholders’ equity increased from $71.6 million at December 31, 2015 to $72.6 million at December 31, 2016. This increase was the result of net income of $5,521,000, dividends paid of $1,446,000, and $18,000 from the issuance of 843 treasury shares under the Corporation’s Employee Stock Purchase Plan, offset by a $2,263,000 negative equity change in unrealized securities gains (losses), net of tax, and $833,000 from the repurchase of 43,665 shares, during the year ended December 31, 2016. The negative change in net unrealized securities gains (losses) was due to long-term interest rate increases, primarily in November 2016. These changes are considered ordinary and customary in the bond market. Net unrealized gains (losses) on available-for-sale securities are reported as accumulated other comprehensive income (loss) in the consolidated balance sheets.
United Bancshares, Inc. is the holding company of The Union Bank Company which serves Allen, Delaware, Hancock, Marion, Putnam, Sandusky, Van Wert and Wood Counties in Ohio, with office locations in Bowling Green, Columbus Grove, Delaware, Delphos, Findlay, Gibsonburg, Kalida, Leipsic, Lima, Marion, Ottawa, and Pemberville, Ohio.
This release may contain certain forward-looking statements that are provided to assist in the understanding of anticipated future financial performance. However, such performance involves risk and uncertainties that may cause actual results to differ materially. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to, the strength of the local economies in which operations are conducted, the effects of and changes in policies and laws of regulatory agencies, inflation, and interest rates. For further discussion of certain factors that may cause such forward-looking statements to differ materially from actual results, refer to the 2015 Form 10-K.
Exhibit 99.2
United Bancshares, Inc.
Quarterly Report
December 31, 2016
Shareholders, Customers and Team Members:
I am pleased to report that your Company had another successful year in 2016. In addition to reporting income before taxes of approximately $7.3 million, return on average equity of 7.94% and return on average assets of 0.90%, the Company also reported growth of approximately 6.2% and 5.0% for loans and non-interest bearing deposits, respectively.
The strategic decisions previously communicated to reposition our balance sheet after the 2014 acquisition through the systematic run off of volatile deposits and loan relationships were essentially completed during the fourth quarter of 2016. During this time of transition, the bank has built a robust pipeline of opportunities which positively impacted our balance sheet in the fourth quarter of 2016. Your management team remains committed to a methodical and consistent growth strategy through building relationships in our communities and reviewing other opportunities as they present themselves. We continue to believe that a measured balance sheet growth strategy reduces overall risk and drives long-term value for our shareholders.
I am also pleased to report that our shares closed the year 17% higher than in 2015 and that the Board of Directors declared a $0.12 per share dividend (approximately a 9% increase from the prior quarter), payable on March 15th to shareholders of record as of February 28, 2017. This decision was reached after their review of your Company’s capital position, risk profile, earnings levels, and available capital sources. We understand how important dividends and increased stock value are for our shareholders; both of these investment objectives have and will remain important parts of the Company’s consideration as the board determines capital allocation.
As we look forward, our journey will undoubtedly be presented with numerous obstacles and challenges. Regardless of the environment, we continue to believe that the drivers of our success are, and will continue to be, our strong corporate values of respect for and accountability to our shareholders, customers, colleagues, and communities.
As always, we greatly appreciate your continued support and the trust you have placed in us.
Respectfully,
Brian D. Young
President & CEO
United Bancshares, Inc.
and Subsidiary
Financial Information (unaudited) | For the Year ended December 31, 2016 | For the Year ended December 31, 2015 | ||
(dollars in thousands, except per share data) | ||||
CONDENSED STATEMENT OF INCOME | ||||
Interest income | $ 21,627 | $ 22,836 | ||
Interest expense | 2,231 | 2,077 | ||
Net interest income | 19,396 | 20,759 | ||
Provision (credit) for loan and lease losses | (750) | 382 | ||
Net interest income after provision (credit) for loan and | ||||
lease losses | 20,146 | 20,377 | ||
Non-interest income | 4,903 | 4,637 | ||
Non-interest expenses | 17,784 | 17,692 | ||
Income before income taxes | 7,265 | 7,322 | ||
Provision for income taxes | 1,744 | 1,405 | ||
Net income | $ 5,521 | $ 5,917 | ||
Average common shares outstanding | 3,289,497 | 3,339,242 | ||
PER COMMON SHARE | ||||
Net income | $ 1.68 | $ 1.77 | ||
Book value | $22.21 | $21.62 | ||
Tangible book value | $18.89 | $18.31 | ||
Closing price | $21.42 | $18.24 | ||
FINANCIAL RATIOS | ||||
Return on average assets | 0.90% | 0.94% | ||
Return on average equity | 7.94% | 8.51% | ||
Net interest margin | 3.54% | 3.71% | ||
Efficiency ratio | 71.71% | 68.13% | ||
Loans to deposits | 71.68% | 67.59% | ||
Allowance for loan and lease losses to loans | 0.89% | 1.08% | ||
PERIOD END BALANCES | ||||
As of December 31, 2016 | As of December 31, 2015 | |||
Assets | $633,119 | $608,665 | ||
Loans and leases, gross | $376,086 | $354,250 | ||
Deposits | $524,680 | $518,419 | ||
Shareholders' equity | $ 72,558 | $ 71,561 | ||
Common shares outstanding | 3,266,517 | 3,309,339 |
UNITED BANCSHARES, INC.
DIRECTORS
Robert L. Benroth
Daniel W. Schutt – Vice Chairman
James N. Reynolds - Chairman
R. Steven Unverferth
H. Edward Rigel
Brian D. Young
David P. Roach
OFFICERS
Brian D. Young - President/CEO
Heather M. Oatman - Secretary
Daniel J. Lucke - Chief Financial Officer
THE UNION BANK COMPANY
DIRECTORS
Robert L. Benroth
H.Edward Rigel
Anthony M.V. Eramo
David P. Roach
Herbert H. Huffman
Robert M. Schulte, Sr.
Kevin L. Lammon
Daniel W. Schutt
William R. Perry
R. Steven Unverferth
James N. Reynolds
Brian D. Young - Chairman/President/CEO
INVESTOR MATERIALS:
United Bancshares, Inc. has traded its common stock on the NASDAQ Markets Exchange under the symbol “UBOH” since March 2001. Annual and quarterly shareholder reports, regulatory filings, press releases, and articles about United Bancshares, Inc. are available in the Shareholder Information section of our website www.theubank.com or by calling 1-800-837-8111.
Locations
1300 N. Main St.
Bowling Green, OH 43402
419-353-6088
100 S. High St.
Columbus Grove, OH 45830
419-659-2141
101 Progressive Dr.
Columbus Grove, OH 45830
419-659-4250
30 Coal Bend
Delaware, OH 43015
740-549-3400
114 E. 3rd St.
Delphos, OH 45833
419-692-2010
1500 Bright Rd.
Findlay, OH 45840
419-424-1400
230 W. Madison St.
Gibsonburg, OH 43431
419-637-2124
110 E. North St.
Kalida, OH 45853
419-532-3366
318 S. Belmore St.
Leipsic, OH 45856
419-943-2171
1410 Bellefontaine Ave.
Lima, OH 45804
419-229-6500
3211 Elida Rd.
Lima, OH 45805
419-331-3211
701 Shawnee Rd.
Lima, OH 45805
419-228-2114
111 S. Main St.
Marion, OH 43302
740-387-2265
220 Richland Rd.
Marion, OH 43302
740-386-2171
245 W. Main St.
Ottawa, OH 45875
419-523-2265
132 E. Front St.
Pemberville, OH 43450
419-287-3211