-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EkQK5G0ude6lYznC25wUuIT6a/7Kdui5XUoYS7gUezgMo5sXKxi18l/2s75c1Fzv /HulH2sOg6ryI3UhKkqa/Q== 0000909654-08-001297.txt : 20080801 0000909654-08-001297.hdr.sgml : 20080801 20080801133957 ACCESSION NUMBER: 0000909654-08-001297 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20080731 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20080801 DATE AS OF CHANGE: 20080801 FILER: COMPANY DATA: COMPANY CONFORMED NAME: COMMUNITY FINANCIAL SHARES INC CENTRAL INDEX KEY: 0001123735 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 364387843 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-51296 FILM NUMBER: 08984437 BUSINESS ADDRESS: STREET 1: 357 ROOSEVELT ROAD CITY: GLEN ELLYN STATE: IL ZIP: 60137 BUSINESS PHONE: 6305450900 MAIL ADDRESS: STREET 1: 357 ROOSEVELT ROAD CITY: GLEN ELLYN STATE: IL ZIP: 60137 8-K 1 communityfin8kaug1-08.txt 1 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): July 31, 2008 ------------- COMMUNITY FINANCIAL SHARES, INC. (Exact name of registrant as specified in its charter) Delaware 0-51296 36-4387843 -------- --------- ---------- (State or other Jurisdiction of (Commission (IRS Employer incorporation) File Number) Identification No.) 357 Roosevelt Road, Glen Ellyn, Illinois 60137 ---------------------------------------------- (Address of principal executive offices) (630) 545-0900 -------------- (Registrant's telephone number, including area code) Not Applicable -------------- (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: [ ] 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)) 2 ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION. --------------------------------------------- On July 31, 2008, Community Financial Shares, Inc. (the "Company") announced its unaudited financial results for the quarter ended June 30, 2008. For more information, reference is made to the Company's press release dated July 31, 2008, a copy of which is attached to this Report as Exhibit 99.1 and is furnished herewith. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS. --------------------------------- (d) Exhibits Number Description ------ ------------ 99.1 Press Release Dated July 31, 2008 3 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. Dated: August 1, 2008 By: /s/ Eric J. Wedeen ---------------------------------- Eric J. Wedeen Vice President and Chief Financial Officer EX-99.1 2 communityfinexb99aug1-08.txt 1 EXHIBIT 99.1 Glen Ellyn, Illinois Contact: Scott W. Hamer July 31, 2008 President/CEO Company Release 630-545-0900 COMMUNITY FINANCIAL SHARES, INC. ANNOUNCES SECOND QUARTER 2008 OPERATING RESULTS Community Financial Shares, Inc. (OTCBB: CFIS) (the "Company"), the holding company for Community Bank-Wheaton/Glen Ellyn (the "Bank"), reported net loss (unaudited) for the three and six months ended June 30, 2008 of $327,000 and $246,000, respectively. This compares to net income of $405,000 and $1.3 million for the comparable prior year periods. For the three months ended June 30, 2008, basic and diluted loss per share both totaled $0.26. This represents a decrease of 189.7% from $0.29 for both basic and diluted earnings per share for the comparable prior year period. In addition, for the six months ended June 30, 2008 basic and diluted earnings loss per share both totaled $0.20. This represents a decrease of 121.3% from $0.94 for both basic and diluted earnings per share for the six months ended June 30, 2007. The decrease in net income for the three months ended June 30, 2008 is primarily the result of the net effect of an $800,000 increase in provision for loan losses, a $291,000 decrease in net interest income and a $144,000 increase in noninterest expense, partially offset by a credit for income tax of $322,000 as opposed to a $123,000 expense for the comparable prior year period. Similarly, the decrease in net income for the six months ended June 30, 2008 is primarily the result of the net effect of an $830,000 increase in provision for loan losses, a $610,000 decrease in net interest income, a $321,000 decrease in noninterest income and a $444,000 increase in noninterest expense, partially offset by a credit for income tax of $374,000 as opposed to a $285,000 expense for the comparable prior year period. Total assets at June 30, 2008 were $289.8 million, which represents a decrease of $8.5 million, or 2.8%, compared to $298.3 million at December 31, 2007. The decrease in total assets was the result of a decrease in cash and cash equivalents of $2.8 million to $5.0 million at June 30, 2008 from $7.8 million from December 31, 2007, a decrease in loans receivable of $4.2 million, or 1.9%, to $223.5 million at June 30, 2008 from $227.7 million at December 31, 2007, a decrease in investment securities of $2.2 million, 6.5%, to $31.0 million at June 30, 2008 from $33.2 million at December 31, 2007. The decrease in loans is primarily due to the sale of $6.6 million of commercial real estate loans in March 2008. Net of loans sold, loans receivable increased $2.4 million. The net growth in loans during the six months ended June 30, 2008 is primarily due to continued strong relationships within our community maintained by our loan staff. 2 The decreases in total loans were partially offset by an increase in premises and equipment of $482,000, or 2.9%, to $17.0 million at June 30, 2008 from $16.5 million at December 31, 2007. The increase in premises and equipment is primarily due to the Company's final construction costs associated with its fourth full-service location in north Wheaton, Illinois, which opened November 21, 2007. Deposits decreased $3.2 million, or 1.3%, to $245.8 million at June 30, 2008 from $249.0 million at December 31, 2007. Deposits decreased primarily due to strong local competition for certificates of deposit. As a result, the percentage of certificates of deposit to total deposits decreased from 47.0% at December 31, 2007 to 41.3% at June 30, 2008 and the percentage of interest bearing demand deposit accounts increased to 19.8% at June 30, 2008 from 15.9% at December 31, 2007. Borrowed money, consisting of Federal Home Loan Bank advances and other borrowings, decreased $3.6 million to $21.4 million at June 30, 2008 from $25.0 million at December 31, 2007. Stockholders' equity decreased $777,000, or 4.2%, to $17.7 million at June 30, 2008 from $18.5 million at December 31, 2007. The decrease in stockholders' equity for the six months ended June 30, 2008 was primarily the result of stock repurchases by the Company of 6,333 shares of its outstanding common stock totaling $165,000, dividends paid of $149,000, a decrease of $244,000 in the Company's accumulated other comprehensive income relating to the change in fair value of its available-for-sale investment portfolio and the Company's net loss for the six months ended June 30, 2008. As of June 30, 2008 there were 1,245,267 shares of Company common stock outstanding, resulting in a book value of $14.24 per share. Net interest income before provision for loan losses decreased $291,000, or 12.2%, to $2.1 million for the three months ended June 30, 2008 and $610,000, or 12.9%, to $4.1 million for the six months ended June 30, 2008 as compared to the comparable prior year periods. These decreases are primarily due to decreases in the average yield on interest-earning assets of 124 and 99 basis points for the three and six months ended June 30, 2008, respectively. The average yield on interest-earning assets decreased to 5.76% and 5.95% for the three and six months ended June 30, 2008, respectively, from 7.00% and 6.94% for the comparable prior year periods. The effect of this decrease in average yield was partially offset by decreases in the average cost of interest bearing liabilities of 66 and 32 basis points for the three and six months ended June 30, 2008, respectively. 3 The average cost of interest-bearing liabilities decreased to 2.83% and 3.11% for the three and six months ended June 30, 2008, respectively, from 3.49% and 3.43% for the comparable prior year periods. The net interest margin, expressed as a percentage of average earning assets, decreased 71 basis points to 3.16% for the three months ended June 30, 2008 from 3.87% for the three months ended June 30, 2007; however it increased 15 basis points from the linked quarter, and decreased 78 basis points to 3.08% for the six months ended June 30, 2008 from 3.86% for the six months ended June 30, 2007. The average yield on loans decreased 155 and 127 basis points for the three and six months ended June 30, 2008 compared to the comparable prior year periods. This decrease is partially due to approximately one-half of the Bank's loan portfolio being adjustable rate. The average yield on loans decreased to 6.05% and 6.25% for the three and six months ended June 30, 2008, respectively, from 7.60% and 7.52% for the comparable prior year periods. The provision for loan losses increased $800,000 and $830,000 for the three and six months ended June 30, 2008 compared to the prior year period. The increase in the provision was the result of regulatory considerations as well as management's quarterly analysis of the allowance for loan loss. Nonperforming loans totaled $3.1 million, or 1.09% of total assets at June 30, 2008 and $152,000 or 0.06% of total assets at June 30, 2007. The increase in nonperforming loans was primarily the result of the addition of a $2.0 million condominium construction loan located in the western suburbs of Chicago, Illinois. This credit represents approximately 65% of total nonperforming loans at June 30, 2008 and is closely monitored by senior management. The ratio of the allowance for loan losses to nonperforming loans totaled 89.2% and 1,021.7% at June 30, 2008 and June 30, 2007, respectively. Noninterest income increased $59,000, or 14.9%, to $454,000 for the three months ended June 30, 2008 as compared to the comparable prior year period. The increase is primarily due to increases in gain on sale of loans of $44,000 and service charges on deposit accounts of $29,000. Noninterest income decreased $321,000, or 24.7%, to $981,000 for the six months ended June 30, 2008 as compared to the comparable prior year period. This decrease is primarily due to a decrease in life insurance death benefit of $478,000. Partially offsetting this decrease are increases in gain on sale of loans of $109,000, gain on sale of securities of $42,000 and an increase in service charges on deposit accounts of $38,000. 4 Noninterest expense increased $144,000, or 6.4%, to $2.4 million for the three months ended June 30, 2008 as compared to the comparable prior year period. This increase is primarily due to increases in compensation and benefits of $91,000, building and equipment expense of $62,000 and data processing expense of $32,000. The increase in compensation and benefits expense is the result of annual merit increases and the addition of staff. The additional staff expenses are primarily due to the new facility, which opened November 21, 2007. The increase in building and equipment expense are due to higher real estate taxes and a higher level of depreciation expense directly related to our new north Wheaton facility. Noninterest expenses increased $444,000, or 10.0%, to $4.9 million for the six months ended June 30, 2008 as compared to the comparable prior year period. This increase is primarily due to increases in compensation and benefits of $180,000, building and equipment expense of $158,000, data processing expense of $76,000 and FDIC insurance premiums of $103,000 primarily due to the depletion of the one-time credit. Partially offsetting these increases was a decrease in advertising and marketing of $32,000. On June 18, 2008, the Company's Board of Directors approved a $0.06 per share dividend. The cash dividend will be paid on or about July 31, 2008 to shareholders of record on July 16, 2008. Community Financial Shares, Inc. is a bank holding company headquartered in Glen Ellyn, Illinois with $289.8 million in assets at June 30, 2008. Its primary subsidiary, Community Bank-Wheaton/Glen Ellyn, maintains four full service offices in Glen Ellyn and Wheaton. For further information about the Company and the Bank visit them on the world-wide-web at www.commbank-wge.com. In addition, information on the Company's stock can be found at www.otcbb.com under the symbol CFIS. Statements contained in this news release which are not historical facts, are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. 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, which include, but are not limited to, factors discussed in documents filed by the Company with the Securities and Exchange Commission from time to time. The Company does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events. 5
COMMUNITY FINANCIAL SHARES, INC. - --------------------------------------------------------------------------------------------------------------- SELECTED CONSOLIDATED FINANCIAL DATA: (UNAUDITED) June 30, March 31, December 31, (IN THOUSANDS) 2008 2008 2007 - --------------------------------------------------------------------------------------------------------------- Total assets $ 289,836 $ 300,515 $ 298,311 Loans receivable, net 223,457 229,929 227,736 Investment securities available-for-sale 30,996 28,036 33,163 Deposits 245,795 255,100 249,032 FHLB Advances 17,000 19,500 17,500 Stockholders' equity 17,728 18,263 18,505 Nonperforming assets 3,145 454 697 Nonperforming loans 3,145 454 697 Allowance for loan losses 2,805 2,002 1,970 - --------------------------------------------------------------------------------------------------------------- SELECTED RATIOS: Total equity to total assets 6.12% 6.08% 6.20% Allowance for loan losses as a % of nonperforming assets 89.2% 441.3% 282.7% Allowance for loan losses as a % of loans, net 1.24% 0.86% 0.86% Book value per share $ 14.24 $ 14.67 $ 14.85 Market value per share 20.00 25.00 25.60 Dividends per share (for the quarter ended) 0.06 0.06 0.06 Quarterly net interest margin (1) 3.16% 3.01% 3.20% - --------------------------------------------------------------------------------------------------------------- Three months ended Six months ended June 30, June 30, - --------------------------------------------------------------------------------------------------------------- SELECTED OPERATING DATA: (UNAUDITED) 2008 2007 2008 2007 - --------------------------------------------------------------------------------------------------------------- (IN THOUSANDS, EXCEPT PER SHARE DATA) Interest income $ 3,827 $ 4,327 $ 7,969 $ 8,507 Interest expense 1,727 1,936 3,844 3,773 --------- --------- --------- --------- Net interest income 2,100 2,391 4,125 4,734 Provision for loan losses 800 - 830 - --------- --------- --------- --------- Net interest income after provision for loan losses 1,300 2,391 3,295 4,734 Noninterest income 454 395 981 1,302 Noninterest expense 2,403 2,258 4,896 4,452 --------- --------- --------- --------- Income (loss) before income tax (649) 528 (620) 1,584 Income tax expense (benefit) (322) 123 (374) 285 --------- --------- --------- --------- Net income (loss) $ (327) $ 405 $ (246) $ 1,299 ========= ========= ========= ========= Earnings (loss) per share - basic $ (0.26) $ 0.29 $ (0.20) $ 0.94 Earnings (loss) per share - diluted (0.26) 0.29 (0.20) 0.94 SELECTED PERFORMANCE RATIOS: Return (loss) on average assets (1) -0.44% 0.59% -0.17% 0.96% Return (loss) on average equity (1) -7.12% 7.58% -2.67% 12.34% Noninterest expense to average total assets (1) 3.27% 3.31% 3.30% 3.29% Net interest margin (1) 3.16% 3.87% 3.08% 3.86% Average total assets $ 294,983 $ 273,995 $ 297,469 $ 272,754 Average total equity 18,413 21,441 18,501 21,234
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