-----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, MzLZ/drIvLug9HWEZKHp/OSc+ln9Yauw4i0MaFGJpmNyHJMgE0ix7Q6Vcxol+HNl PxQuYAIYsFcI6l0aGxe0Lg== 0000909654-08-001817.txt : 20081103 0000909654-08-001817.hdr.sgml : 20081103 20081103145003 ACCESSION NUMBER: 0000909654-08-001817 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20081031 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20081103 DATE AS OF CHANGE: 20081103 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: 081157169 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 communityfin8koct31-08.txt 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): October 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)) ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION. --------------------------------------------- On October 31, 2008, Community Financial Shares, Inc. (the "Company") announced its unaudited financial results for the quarter ended September 30, 2008. For more information, reference is made to the Company's press release dated October 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 October 31, 2008 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: October 31, 2008 By: /s/ Eric J. Wedeen ------------------------------------------ Eric J. Wedeen VICE PRESIDENT AND CHIEF FINANCIAL OFFICER EX-99.1 2 communityfin8koct31-08ex99.txt Exhibit 99.1 Glen Ellyn, Illinois Contact: Scott W. Hamer October 31, 2008 President/CEO Company Release 630-545-0900 COMMUNITY FINANCIAL SHARES, INC. ANNOUNCES OPERATING RESULTS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2008 Community Financial Shares, Inc. (OTCBB: CFIS) (the "Company"), the holding company for Community Bank-Wheaton/Glen Ellyn (the "Bank"), reported a net loss (unaudited) for the three and nine months ended September 30, 2008 of $800,000 and $1.0 million, respectively. This compares to net income of $358,000 and $1.7 million for the comparable prior year periods. For the three months ended September 30, 2008, basic and diluted loss per share both totaled $0.64. This represents a decrease of 346.2% from $0.26 for both basic and diluted earnings per share for the comparable prior year period. In addition, for the nine months ended September 30, 2008 basic and diluted loss per share both totaled $0.84. This represents a decrease of 170.0% from $1.20 for both basic and diluted earnings per share for the nine months ended September 30, 2007. The decrease in net income for the three months ended September 30, 2008 is primarily the result of the net effect of a $785,000 increase in provision for loan losses, an other-than-temporary impairment charge of $485,000 related to the Company's investment in Freddie Mac ("FHLMC") preferred stock, a $163,000 decrease in net interest income and a $210,000 increase in noninterest expense, partially offset by a credit for income tax of $308,000 as opposed to a $98,000 expense for the comparable prior year period. Similarly, the decrease in net income for the nine months ended September 30, 2008 is primarily the result of the net effect of a $1.6 million increase in provision for loan losses, a non-cash charge of $485,000 related to the impairment of FHLMC preferred stock, a $773,000 decrease in net interest income, a $654,000 increase in noninterest expense, partially offset by a credit for income tax of $682,000 as opposed to a $383,000 expense for the comparable prior year period. Total assets at September 30, 2008 were $285.1 million, which represents a decrease of $13.2 million, or 4.4%, 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 $2.4 million , or 30.8%, to $5.4 million at September 30, 2008 from $7.8 million from December 31, 2007, a decrease in loans receivable of $6.4 million, or 2.8%, to $221.3 million at September 30, 2008 from $227.7 million at December 31, 2007, a decrease in investment securities of $5.4 million, or 16.2%, to $27.8 million at September 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 $200,000. The net growth in loans during the nine months ended September 30, 2008 is primarily due to continued strong relationships within our community maintained by our loan staff. The decreases in total loans were partially offset by an increase in premises and equipment of $386,000, or 2.3%, to $16.9 million at September 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 $6.1 million, or 2.4%, to $242.9 million at September 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 42.1% at September 30, 2008 and the percentage of interest bearing demand deposit accounts increased to 19.3% at September 30, 2008 from 15.9% at December 31, 2007. Borrowed money, consisting of Federal Home Loan Bank advances and other borrowings, decreased $4.0 million to $21.0 million at September 30, 2008 from $25.0 million at December 31, 2007. Stockholders' equity decreased $1.8 million, or 9.6%, to $16.7 million at September 30, 2008 from $18.5 million at December 31, 2007. The decrease in stockholders' equity for the nine months ended September 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 $438,000 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 nine months ended September 30, 2008. As of September 30, 2008 there were 1,245,267 shares of Company common stock outstanding, resulting in a book value of $13.44 per share. Net interest income before provision for loan losses decreased $163,000, or 7.0%, to $2.2 million for the three months ended September 30, 2008 and $773,000, or 11.0%, to $6.3 million for the nine months ended September 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 121 and 107 basis points for the three and nine months ended September 30, 2008, respectively. The average yield on interest-earning assets decreased to 5.60% and 5.84% for the three and nine months ended September 30, 2008, respectively, from 6.81% and 6.91% 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 105 and 56 basis points for the three and nine months ended September 30, 2008, respectively. The average cost of interest-bearing liabilities decreased to 2.53% and 2.92% for the three and nine months ended September 30, 2008, respectively, from 3.58% and 3.48% for the comparable prior year periods. The net interest margin, expressed as a percentage of average earning assets, decreased 32 basis points to 3.27% for the three months ended September 30, 2008 from 3.59% for the three months ended September 30, 2007; however it increased 11 basis points from the three months ended June 30, 2008, and decreased 62 basis points to 3.15% for the nine months ended September 30, 2008 from 3.77% for the nine months ended September 30, 2007. The average yield on loans decreased 146 and 133 basis points for the three and nine months ended September 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 5.85% and 6.12% for the three and nine months ended September 30, 2008, respectively, from 7.31% and 7.45% for the comparable prior year periods. The provision for loan losses increased $785,000 and $1.6 million for the three and nine months ended September 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 $5.0 million, or 1.75% of total assets, at September 30, 2008 and $156,000 or 0.05% of total assets, at September 30, 2007. The increase in nonperforming loans was primarily the result of the addition of a $1.8 million condominium construction loan located in the western suburbs of Chicago, Illinois and a $2.2 million commercial and industrial loan. Both of these credits are being closely monitored by senior management. These credits represent approximately 80% of total nonperforming loans at September 30, 2008. The ratio of the allowance for loan losses to nonperforming loans totaled 69.8% and 995.7% at September 30, 2008 and September 30, 2007, respectively. Noninterest income was significantly impacted by the other-than-temporary impairment charge related to an investment in FHLMC preferred stock. As a result of this $485,000 write-down, noninterest income decreased $405,000 or 107.2%, to a loss of $27,000 for the three months ended September 30, 2008 as compared to the comparable prior year period. The FHLMC write-down was offset by increases in gain on sale of loans of $49,000 and service charges on deposit accounts of $47,000. Including the $485,000 write-down mentioned above, noninterest income decreased $726,000, or 43.2%, to $954,000 for the nine months ended September 30, 2008 as compared to the comparable prior year period. This decrease is 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 $158,000, gain on sale of securities of $17,000 and an increase in service charges on deposit accounts of $85,000. Noninterest expense increased $210,000, or 9.4%, to $2.4 million for the three months ended September 30, 2008 as compared to the comparable prior year period. This increase is primarily due to increases in compensation and benefits of $69,000, building and equipment expense of $89,000 and data processing expense of $46,000. The increase in compensation and benefits expense is the result of annual merit increases and additional staff expenses primarily relating to the opening of our new facility on 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. The increases were partially offset by decreases in advertising and marketing of $28,000 and professional fees of $25,000. Noninterest expenses increased $654,000, or 9.8%, to $7.3 million for the nine months ended September 30, 2008 as compared to the comparable prior year period. This increase is primarily due to increases in compensation and benefits of $249,000, building and equipment expense of $247,000, data processing expense of $122,000 and FDIC insurance premiums of $147,000 primarily due to the depletion of the one-time credit. Partially offsetting these increases was a decrease in advertising and marketing expense of $59,000. Management continues to emphasize the importance of expense management and control in order to continue to provide expanded banking services to a growing market base. Community Financial Shares, Inc. is a bank holding company headquartered in Glen Ellyn, Illinois with $285.1 million in assets at September 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.
Community Financial Shares, Inc. - ------------------------------------------------------------------------------------------------------------------ Selected Consolidated Financial Data: (Unaudited) September 30, June 30, March 31, December 31, (In thousands) 2008 2008 2008 2007 - ------------------------------------------------------------------------------------------------------------------ Total assets $ 285,109 $ 289,836 $ 300,515 $ 298,311 Loans receivable, net 221,334 223,457 229,929 227,736 Investment securities available-for-sale 27,784 30,996 28,036 33,163 Deposits 242,949 245,795 255,100 249,032 FHLB Advances 17,000 17,000 19,500 17,500 Stockholders' equity 16,736 17,728 18,263 18,505 Nonperforming assets 4,982 3,145 454 697 Nonperforming loans 4,982 3,145 454 697 Allowance for loan losses 3,479 2,805 2,002 1,970 - ------------------------------------------------------------------------------------------------------------------ Selected ratios: Total equity to total assets 5.87% 6.12% 6.08% 6.20% Allowance for loan losses as a % of nonperforming assets 69.8% 89.2% 441.3% 282.7% Allowance for loan losses as a % of loans 1.55% 1.24% 0.86% 0.86% Book value per share $ 13.44 $ 14.24 $ 14.67 $ 14.85 Market value per share 17.50 20.00 25.00 25.60 Dividends per share (for the quarter ended) -- 0.06 0.06 0.06 Quarterly net interest margin (1) 3.27% 3.16% 3.01% 3.20% - ------------------------------------------------------------------------------------------------------------------ Three months ended Nine months ended September 30, September 30, -------------------------------------------------------- Selected operating data: (Unaudited) 2008 2007 2008 2007 -------------------------------------------------------- (In thousands, except per share data) Interest income $ 3,688 $ 4,404 $ 11,657 $ 12,911 Interest expense 1,531 2,083 5,376 5,856 --------- --------- --------- --------- Net interest income 2,157 2,321 6,281 7,055 Provision for loan losses 795 10 1,625 10 --------- --------- --------- --------- Net interest income after provision for loan losses 1,362 2,311 4,656 7,045 Noninterest income (27) 377 954 1,680 Noninterest expense 2,443 2,232 7,339 6,685 --------- --------- --------- --------- Income (loss) before income tax (1,108) 456 (1,728) 2,040 Income tax expense (benefit) (308) 98 (682) 383 --------- --------- --------- --------- Net income (loss) $ (800) $ 358 $ (1,046) $ 1,656 ========= ========= ========= ========= Earnings (loss) per share - basic $ (0.64) $ 0.26 $ (0.84) $ 1.20 Earnings (loss) per share - diluted (0.64) 0.26 (0.84) 1.20 Selected performance ratios: Return (loss) on average assets (1) (1.10%) 0.50% (0.47%) 0.80% Return (loss) on average equity (1) (17.92%) 6.56% (7.64%) 10.33% Noninterest expense to average total assets (1) 3.36% 3.13% 3.32% 3.22% Net interest margin (1) 3.27% 3.59% 3.15% 3.77% Average total assets $ 288,040 $ 283,177 $ 294,370 $ 276,293 Average total equity 17,706 21,636 18,234 21,368
(1) Annualized. -----END PRIVACY-ENHANCED MESSAGE-----