Quarterly Financial and Statistical Supplement

EX-99.3 4 dex993.htm QUARTERLY FINANCIAL AND STATISTICAL SUPPLEMENT Quarterly Financial and Statistical Supplement

Exhibit 99.3

BANKFINANCIAL CORPORATION

FOURTH QUARTER 2007

QUARTERLY FINANCIAL AND STATISTICAL SUPPLEMENT

FOR THE LATEST FIVE QUARTERS

Note: Certain reclassifications have been made in the prior period’s financial statements and reflected in the Selected Quarterly Financial and Statistical Data tables to conform with the current period’s presentation.

The information and statistical data contained herein have been prepared by BankFinancial Corporation and have been derived or calculated from selected quarterly and period-end historical financial statements prepared in accordance with accounting principles generally accepted in the United States. BankFinancial Corporation is under no obligation to update, keep current or continue to provide the information contained herein. This information is provided solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or establish any business relationships with BankFinancial Corporation or its subsidiary.

BANKFINANCIAL CORPORATION

SELECTED QUARTERLY FINANCIAL AND STATISTICAL DATA

Latest Five Quarters

(Dollars in thousands; except per share) – (Unaudited)

PERFORMANCE MEASUREMENTS:


	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
Return on assets (ratio of net income to average total assets) (1)		0.25	%		0.59	%		0.61	%		0.42	%		0.30	%
Return on equity (ratio of net income to average equity) (1)		1.23			2.90			3.01			2.03			1.48
Net interest rate spread (1)		3.02			2.91			2.88			2.98			2.91
Net interest margin (1)		3.80			3.76			3.74			3.84			3.74
Efficiency ratio		92.05			77.38			80.79			81.66			93.01
Noninterest expense to average total assets (1)		3.86			3.26			3.28			3.31			3.82
Average interest-earning assets to average interest-bearing liabilities		130.01			130.11			131.30			132.31			131.53
Offices		18			18			18			18			18
Employees (full time equivalents)		425			416			418			425			438

SUMMARY INCOME STATEMENT:

	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
Total interest income	$	21,925		$	23,124		$	23,111		$	23,793		$	23,867
Total interest expense		8,880			9,899			9,760			9,765			9,854

Net interest income before provision		13,045			13,225			13,351			14,028			14,013
Provision (credit) for loan losses		10			460			(354	)		581			(537	)

Net interest income		13,035			12,765			13,705			13,447			14,550
Noninterest income		2,502			2,777			2,327			2,042			2,533
Noninterest expense		14,311			12,383			12,666			13,122			15,390

Income before income tax		1,226			3,159			3,366			2,367			1,693
Income tax expense		297			922			1,028			716			486

Net income	$	929		$	2,237		$	2,338		$	1,651		$	1,207


Basic earnings per common share	$	0.05		$	0.11		$	0.11		$	0.08		$	0.06

Diluted earnings per common share	$	0.05		$	0.11		$	0.11		$	0.08		$	0.06


NONINTEREST INCOME AND EXPENSE:

	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
Noninterest Income:
Deposit service charges and fees	$	915		$	938		$	918		$	835		$	1,022
Other fee income		484			495			499			461			507
Insurance commissions and annuities income		287			251			225			244			378
Gain on sales of loans		34			43			1			48			61
Gain (loss) on sales of investment securities		—			399			—			—			(43	)
Gain on disposition of premises and equipment		(4	)		—			7			6			1
Loan servicing fee income		204			182			214			211			227
Amortization and impairment of servicing assets		(64	)		(131	)		(106	)		(95	)		(121	)
REO operations		(13	)		(4	)		—			—			1
Earnings on bank-owned life insurance		231			219			135			—			—
Other		428			385			434			332			500

Total noninterest income	$	2,502		$	2,777		$	2,327		$	2,042		$	2,533


Noninterest Expense:
Compensation and benefits	$	8,206		$	7,773		$	7,860		$	8,437		$	10,674
Office occupancy and equipment		1,615			1,428			1,399			1,507			1,416
Advertising		320			409			455			228			243
Data processing		848			821			823			749			855
Supplies, telephone and postage		572			485			484			568			560
Amortization of intangibles		464			469			469			477			489
Visa Settlement		1,240			—			—			—			—
Other		1,046			998			1,176			1,156			1,153

Total noninterest expenses	$	14,311		$	12,383		$	12,666		$	13,122		$	15,390

(1)	Annualized

Page 2

BANKFINANCIAL CORPORATION

SELECTED QUARTERLY FINANCIAL AND STATISTICAL DATA

Latest Five Quarters

(Dollars in thousands; except per share) – (Unaudited)

SUMMARY BALANCE SHEET:


	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
ASSETS:
Cash	$	28,279		$	30,694		$	32,071		$	35,357		$	38,286
Interest-bearing deposits and short-term investments		669			14,003			33,887			30,947			29,051
Securities available for sale, net		77,049			67,686			69,085			106,884			117,853
Loans held for sale		173			2,031			620			143			298
Loans receivable, net		1,253,999			1,276,303			1,282,645			1,298,489			1,330,091
Federal Home Loan Bank stock		15,598			15,598			15,598			15,598			15,598
Premises and equipment		34,487			34,171			34,437			34,571			35,005
Intangible assets		30,335			30,799			31,268			31,750			32,227
BOLI		19,585			19,354			19,135			—			—
Other assets		20,370			14,157			13,182			13,382			14,889

Total assets	$	1,480,544		$	1,504,796		$	1,531,928		$	1,567,121		$	1,613,298


LIABILITIES AND EQUITY:
Deposits	$	1,073,650		$	1,098,541		$	1,105,237		$	1,105,846		$	1,129,585
Borrowings		96,433			81,138			100,862			134,300			138,148
Other liabilities		19,324			21,496			18,917			17,388			19,550

Total liabilities		1,189,407			1,201,175			1,225,016			1,257,534			1,287,283
Stockholders’ equity		291,137			303,621			306,912			309,587			326,015

Total liabilities and stockholders’ equity	$	1,480,544		$	1,504,796		$	1,531,928		$	1,567,121		$	1,613,298


CAPITAL RATIOS:

	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
BankFinancial Corporation:
Equity to total assets (end of period)		19.66	%		20.18	%		20.03	%		19.76	%		20.21	%
Tangible equity to tangible total assets (end of period)		17.95			18.51			18.37			18.10			18.58

BankFinancial FSB:
Risk-based total capital ratio		16.74			19.07			20.26			20.64			20.09
Risk-based tier 1 capital ratio		15.93			18.22			19.43			19.74			19.26
Tier 1 leverage ratio		13.95			15.16			15.94			15.51			15.05

Stock repurchases—$ (000’s)	$	5,273		$	5,643		$	3,780		$	19,261		$	3,960
Stock repurchases—shares		335,900			377,406			232,643			1,131,974			226,600

COMMON STOCK AND DIVIDENDS:

	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
Stock Prices:
Close	$	15.82		$	15.82		$	15.45		$	16.27		$	17.81
High		16.67			16.39			16.75			17.98			18.50
Low		14.54			13.01			15.45			16.10			17.23

Cash dividends paid	$	0.07		$	0.07		$	0.07		$	0.07		$	0.06

DEPOSITS:

	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
Non-interest-bearing demand	$	111,554		$	111,772		$	126,304		$	122,422		$	134,097
Interest-bearing NOW		306,517			297,589			282,300			277,683			274,391
Money market		250,682			266,737			262,265			258,400			260,796
Savings		97,280			101,176			107,030			114,793			114,851
Certificates of deposit—Retail		305,610			314,450			317,946			321,444			323,957
Certificates of deposit—Wholesale		2,007			6,817			9,392			11,104			21,493

Total certificates of deposit		307,617			321,267			327,338			332,548			345,450

Total deposits	$	1,073,650		$	1,098,541		$	1,105,237		$	1,105,846		$	1,129,585

Page 3

BANKFINANCIAL CORPORATION

SELECTED QUARTERLY FINANCIAL AND STATISTICAL DATA

Latest Five Quarters

(Dollars in thousands; except per share) – (Unaudited)


	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
LOANS:
One- to four-family residential real estate	$	345,245		$	373,830		$	381,447		$	391,759		$	397,545
Multi-family mortgage loans		291,395			288,883			291,963			299,566			297,131
Nonresidential real estate		325,885			326,368			321,943			314,275			320,729
Construction and land loans		64,483			61,482			68,024			68,742			85,222
Commercial loans		83,233			80,358			84,410			90,103			89,346
Commercial leases		144,841			145,761			134,217			134,327			139,164
Consumer loans		3,506			4,009			4,697			3,531			4,045
Other loans (including municipal)		4,544			4,544			4,544			4,752			4,959

Total loans		1,263,132			1,285,235			1,291,245			1,307,055			1,338,141
Loans in process		(168	)		(63	)		(87	)		154			148
Net deferred loan origination costs		2,086			2,211			2,266			2,402			2,424
Allowance for loan losses		(11,051	)		(11,080	)		(10,779	)		(11,122	)		(10,622	)

Loans, net	$	1,253,999		$	1,276,303		$	1,282,645		$	1,298,489		$	1,330,091


CREDIT QUALITY RATIOS:

	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
Nonperforming Loans and Assets:
Nonperforming loans	$	12,058		$	9,557		$	9,720		$	8,759		$	9,226
Real estate owned		820			252			—			—			—

Nonperforming assets	$	12,878		$	9,809		$	9,720		$	8,759		$	9,226


Asset Quality Ratios:
Nonperforming assets to total assets		0.87	%		0.65	%		0.63	%		0.56	%		0.57	%
Nonperforming loans to total loans		0.95			0.74			0.75			0.67			0.69
Allowance for loan losses to nonperforming loans		91.65			115.94			110.90			126.98			115.13
Allowance for loan losses to total loans		0.87			0.86			0.83			0.85			0.79
Net charge-off ratio (1)		0.01			0.05			0.00			0.02			0.23

ALLOWANCE FOR LOAN LOSSES:

	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
Beginning balance	$	11,080		$	10,779		$	11,122		$	10,622		$	11,924
Provision (credit) for loan losses		10			460			(354	)		581			(537	)
Loans charged off		(46	)		(159	)		(3	)		(97	)		(767	)
Recoveries		7			—			14			16			2

Ending balance	$	11,051		$	11,080		$	10,779		$	11,122		$	10,622

(1)	Annualized

Page 4

BANKFINANCIAL CORPORATION

SELECTED QUARTERLY FINANCIAL AND STATISTICAL DATA

Latest Five Quarters

(Dollars in thousands; except per share) – (Unaudited)

SELECTED AVERAGE BALANCES:


	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
Average total assets	$	1,484,541		$	1,518,670		$	1,543,985		$	1,584,765		$	1,611,689
Average earning assets		1,362,890			1,397,286			1,432,238			1,481,465			1,486,033
Average total loans		1,277,238			1,291,593			1,297,583			1,323,345			1,328,482
Average investment securities		64,097			73,370			98,791			112,206			110,033
Average FHLB stock		15,598			15,598			15,598			15,598			18,299
Average other earning assets		5,957			16,725			20,266			30,316			29,219
Average interest-bearing deposits		966,082			986,113			978,601			981,956			980,771
Average total borrowings		82,220			87,782			112,209			137,715			149,001
Average interest-bearing liabilities		1,048,302			1,073,895			1,090,810			1,119,671			1,129,772
Average total stockholders’ equity		301,911			308,041			310,219			325,806			326,010

SELECTED YIELDS AND COST OF FUNDS (1):

	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
Average earning assets		6.38	%		6.57	%		6.47	%		6.51	%		6.37	%
Average total loans		6.46			6.67			6.60			6.66			6.52
Average investment securities		6.47			5.90			5.66			5.51			5.43
Average FHLB stock		—			2.77			2.75			3.72			3.21
Average other earning assets		4.66			5.08			5.30			5.15			5.28

Average interest-bearing deposits		3.22			3.55			3.48			3.42			3.33
Average total borrowings		5.04			4.81			4.51			4.38			4.29
Average interest-bearing liabilities		3.36			3.66			3.59			3.54			3.46

Interest rate spread		3.02			2.91			2.88			2.98			2.91
Net interest margin		3.80			3.76			3.74			3.84			3.74

EARNINGS PER SHARE COMPUTATIONS:

	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
Net income	$	929		$	2,237		$	2,338		$	1,651		$	1,207


Average common shares outstanding		22,429,477			22,692,613			23,124,955			23,924,011			24,384,369
Less: Unearned ESOP shares		(1,728,813	)		(1,753,480	)		(1,777,881	)		(1,802,198	)		(1,826,679	)
Less: Unvested restricted stock		(575,800	)		(619,385	)		(618,600	)		(637,882	)		(730,208	)

Weighted average common shares outstanding		20,124,864			20,319,748			20,728,474			21,483,931			21,827,482
Plus: Dilutive common shares equivalents		—			97,765			26,049			53,611			12,994

Weighted average dilutive shares outstanding		20,124,864			20,417,513			20,754,523			21,537,542			21,840,476


Number of antidilutive stock options excluded from the diluted earnings per share calculation		1,597,400			1,576,200			1,557,500			1,301,000			1,301,000
Weighted average exercise price of anti-dilutive option shares	$	17.40		$	17.34		$	17.36		$	17.63		$	17.63

Earnings per basic share	$	0.05		$	0.11		$	0.11		$	0.08		$	0.06

Earnings per diluted share	$	0.05		$	0.11		$	0.11		$	0.08		$	0.06


N.A. = Not Applicable

(1)	Annualized

Page 5

BANKFINANCIAL CORPORATION

NON-GAAP FINANCIAL MEASURES

The Company utilizes a number of different financial measures, both GAAP and non-GAAP, in making operating, budgeting and planning decisions for future periods. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles in the United States of America, or GAAP. The Company believes that the use of the non-GAAP financial measures described below provides the Board of Directors and management, and may provide some investors, with a more complete understanding of the Company’s operating results and trends, and facilitate comparisons to historical and peer performance. The Company’s non-GAAP financial measures should be considered supplemental in nature and should not be considered in isolation, or as superior to or a substitute for, financial measures that are prepared in accordance with GAAP. In addition, the Company’s non-GAAP financial measures may differ from similar non-GAAP financial measures that are used by other companies, thus limiting their usefulness as a comparative tool.

Amortization of Intangibles Expense. The Company believes that the exclusion from its net income of expense for the amortization of the core deposit intangible assets resulting from its acquisition of Success Bancshares and University National Bank facilitates the comparison of the Company’s operating results to the Company’s historical performance and to the performance of other financial institutions with different acquisition histories. In addition, the level of amortization of core deposit intangible assets arising from an acquisition can vary significantly depending on the valuation methodology used and the interest rate environment that existed at the time of the acquisition.

Equity-based Compensation. The Company believes that the exclusion of equity-based compensation expense from its net income facilitates the comparison of the Company’s operating results to the Company’s historical performance, including the prior periods in which it operated as a mutual institution and had no stock outstanding. In addition, the Company believes that this non-GAAP measure facilitates the comparison of the Company’s performance to the performance of other financial institutions that have different or more seasoned equity-based compensation plans, including plans pursuant to which stock option awards vested prior to the effective date of SFAS No. 123R.

Visa Settlement. The Company believes that the exclusion of this one-time litigation expense due to our proportionate share of Visa litigation charges from its net income facilitates the comparison of the Company’s operating results to the Company’s historical performance

Core Return on Assets. The Company believes that adjusting the calculation of its return on assets to exclude the equity-based compensation expense, the amortization of intangibles expenses and the Visa settlement expense furthers the purposes described above. Thus, the Company calculates core return on assets by dividing net income for a period, adjusted to exclude these expenses, by its average assets for the period.

Core Return on Equity. The Company believes that adjusting the calculation of its return on equity to exclude the equity-based compensation expense, the amortization of intangibles expenses and the Visa settlement expense furthers the purposes described above. Thus, the Company calculates core return on equity by dividing average stockholders’ equity for a period by net income, adjusted to exclude these expenses, for the period.

Core Dilutive Earnings per Share. The Company believes that adjusting the calculation of its dilutive earnings per share to exclude the equity-based compensation expense, the amortization of intangibles expenses and the Visa settlement expense furthers the purposes described above. Thus, the Company calculates core dilutive earnings per share by net income, adjusted to exclude these expenses, for the period by the weighted average dilutive common shares outstanding, for the period.

Page 6

Core Noninterest Expense to Average Total Assets. The Company believes that adjusting the calculation of its noninterest expense to average total assets to exclude the equity-based compensation expense, the amortization of intangibles expenses and the Visa settlement expense furthers the purposes described above. Thus, the Company calculates noninterest expense to average total assets by dividing noninterest expense, adjusted to exclude these expenses, by average total assets for the period.

Core Efficiency Ratio. The Company believes that adjusting the calculation of its efficiency ratio to exclude the equity-based compensation expense, the amortization of intangibles expenses and the Visa settlement expense furthers the purposes described above. Thus, the Company calculates core efficiency ratio by dividing noninterest expense, adjusted to exclude these expenses, by the sum of net interest income and noninterest income.

There are inherent limitations associated with the use of each of the above non-GAAP financial measures as an analytical tool. In particular, these non-GAAP financial measures are not based on a comprehensive set of accounting rules or principles and reflect the exclusion of items that are recurring and will be reflected in the Company’s financial results in the future. The Company has further highlighted these and the other limitations described above by providing a reconciliation of the GAAP amounts that have been excluded from these non-GAAP financial measures.

Page 7

BANKFINANCIAL CORPORATION

NON-GAAP FINANCIAL MEASURES

(Dollars in thousands; except per share) – (Unaudited)

FOR THE QUARTERS AND YEARS ENDED

DECEMBER 31, 2007 AND 2006


	Three months ended December 31,						Years ended December 31,
	2007			2006			2007			2006
Core Operating Income:
Net Income	$	929		$	1,207		$	7,155		$	10,046

Adjustments:
Equity-based compensation and benefits		1,219			3,542			5,084			5,377
Amortization of core deposit intangible		464			489			1,879			1,873
Visa settlement		1,240			—			1,240			—
Tax effect on adjustments assuming 39.745% tax rate		(1,162	)		(1,602	)		(3,260	)		(2,882	)

Core Operating Income	$	2,690		$	3,636		$	12,098		$	14,414


Return on assets (ratio of net income to average total assets) (1)		0.25	%		0.30	%		0.47	%		0.61	%
Core return on assets (ratio of core operating income to average total assets) (1)		0.72	%		0.90	%		0.79	%		0.88	%

Return on equity (ratio of net income to average equity) (1)		1.23	%		1.48	%		2.30	%		3.02	%
Core return on equity (ratio of core operating income to average equity) (1)		3.56	%		4.46	%		3.88	%		4.34	%

Dilutive earnings per common share	$	0.05		$	0.06		$	0.35		$	0.45
Core dilutive earnings per common share	$	0.13		$	0.17		$	0.59		$	0.64

Core Noninterest Expenses:
Noninterest Expenses	$	14,311		$	15,390		$	52,482		$	52,370
Adjustments:
Equity-based compensation and benefits		(1,219	)		(3,542	)		(5,084	)		(5,377	)
Amortization of core deposit intangible		(464	)		(489	)		(1,879	)		(1,873	)
Visa settlement		(1,240	)		—			(1,240	)		—

Core Noninterest Expenses	$	11,388		$	11,359		$	44,279		$	45,120


Noninterest expense to average total assets (1)		3.86	%		3.82	%		3.42	%		3.19	%
Core noninterest expense to average total assets (1)		3.07	%		2.82	%		2.89	%		2.75	%

Efficiency ratio (ratio of noninterest expense to net interest income plus noninterest income)		92.05	%		93.01	%		82.91	%		78.04	%
Core efficiency ratio (ratio of core noninterest expense to net interest income plus noninterest income)		73.25	%		68.65	%		69.95	%		67.24	%

(1)	Annualized for the three-month periods.

Page 8

FOR THE LATEST FIVE QUARTERS


	2007												2006 IVQ
	IVQ			IIIQ			IIQ			IQ			2006 IVQ
Core Operating Income:
Net Income	$	929		$	2,237		$	2,338		$	1,651		$	1,207
Adjustments:
Equity-based compensation and benefits		1,219			1,311			1,294			1,261			3,542
Amortization of core deposit intangible		464			469			469			476			489
Visa settlement		1,240			—			—			—			—
Tax effect on adjustments assuming 39.745% tax rate		(1,162	)		(707	)		(701	)		(690	)		(1,602	)

Core Operating Income	$	2,690		$	3,310		$	3,400		$	2,698		$	3,636


Return on assets (ratio of net income to average total assets) (1)		0.25	%		0.59	%		0.61	%		0.42	%		0.30	%
Core return on assets (ratio of core operating income to average total assets) (1)		0.72	%		0.87	%		0.88	%		0.68	%		0.90	%

Return on equity (ratio of net income to average equity) (1)		1.23	%		2.90	%		3.01	%		2.03	%		1.48	%
Core return on equity (ratio of core operating income to average equity) (1)		3.56	%		4.30	%		4.38	%		3.31	%		4.46	%

Dilutive earnings per common share	$	0.05		$	0.11		$	0.11		$	0.08		$	0.06
Core dilutive earnings per common share	$	0.13		$	0.16		$	0.16		$	0.13		$	0.17

Core Operating Expenses:
Noninterest Expenses	$	14,311		$	12,383		$	12,666		$	13,122		$	15,390
Adjustments:
Equity-based compensation and benefits		(1,219	)		(1,311	)		(1,294	)		(1,261	)		(3,542	)
Amortization of core deposit intangible		(464	)		(469	)		(469	)		(476	)		(489	)
Visa settlement		(1,240	)		—			—			—			—

Core Noninterest Expenses	$	11,388		$	10,603		$	10,903		$	11,385		$	11,359


Noninterest expense to average total assets (1)		3.86	%		3.26	%		3.28	%		3.31	%		3.82	%
Core noninterest expense to average total assets (1)		3.07	%		2.79	%		2.82	%		2.87	%		2.82	%

Efficiency ratio (ratio of noninterest expense to net interest income plus noninterest income)		92.05	%		77.38	%		80.79	%		81.66	%		93.01	%
Core efficiency ratio (ratio of core noninterest expense to net interest income plus noninterest income)		73.25	%		66.26	%		69.54	%		70.85	%		68.65	%

(1)	Annualized for the three-month periods.

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