EX-99 2 ex-99.htm PRESS RELEASE - EARNINGS RELEASE ex-99.htm
MSB Financial Corp. Announces Quarterly Results

MILLINGTON, N.J., February 2, 2011 – MSB Financial Corp. (Nasdaq: MSBF) (the “Company”), the holding company for Millington Savings Bank (the “Bank”), reported net income of $120,000 for the three months ended December 31, 2010, compared to $233,000 for the quarter ended December 31, 2009, representing a decrease of $113,000 or 48.5%.  For the six months ended December 31, 2010, the Company reported net income of $335,000, compared to net income of $427,000 for the six month period ended December 31, 2009, a decrease of $92,000 or 21.5%.  Both reporting periods reflect increased net interest income after provision for loan losses and increased non-interest income, offset by increased levels of non-interest expense.

Net interest income for the three and six months ended December 31, 2010 increased to $2.7 million and $5.5 million, respectively, from $2.6 million and $5.2 million for the three and six months ended December 31, 2009.  For the three months ended December 31, 2010, the yield on interest earning assets was 4.80%, a decrease of 29 basis points when compared to the same period in 2009.  For the six months ended December 31, 2010, the yield on interest earning assets was 4.82%, a decrease of 29 basis points when compared to the same period in 2009.  The rate on interest-bearing liabilities for the three months ended December 31, 2010 was 1.46%, a decrease of 65 basis points when compared to the same period in 2009.  For the six months ended December 31, 2010, the rate on interest-bearing liabilities was 1.51%, a decrease of 70 basis points when compared to the same period in 2009.  The net interest margin increased to 3.45% for the three months ended December 31, 2010, compared to 3.15% for the three months ended December 31, 2009, an increase of 30 basis points.  The net interest margin increased to 3.41% for the six months ended December 31, 2010, compared to 3.10% for the six months ended December 31, 2009, an increase of 31 basis points.  The reduction in interest-bearing liability rates, partially offset by a lesser reduction in interest-earning assets yields, resulted in the higher levels of net interest income and net interest margins.  Total interest income decreased for both periods primarily due to a reduction in the net interest yield as volume also decreased during these comparative periods.

The loan loss provision for the three and six months ended December 31, 2010 was $350,000 and $825,000, respectively, compared to $405,000 and $750,000 for the same periods ended December 31, 2009.  The Bank’s management reviews the level of the allowance for loan losses on a quarterly basis and establishes the provision for loan losses based upon various quantitative and qualitative factors, which include the volume and types of lending, delinquency levels, loss experience, the amount of impaired and classified loans, economic conditions and other factors related to the collectability of the loan portfolio.  The decrease in the provision for the three month period ended December 31, 2010 compared to the same period ended December 31, 2009, reflects the additional provision that was required at December 31, 2009 based on the analysis performed at that time.  The increase in the provision for the six months ended December 31, 2010 compared to the same period ended December 31, 2009 reflects the overall performance of the loan portfolio during this period.  The Bank had $16.6 million in nonperforming loans as of December 31, 2010 compared to $16.8 million as of December 31, 2009.
 
 
 
 
 

 
Non-interest income for the quarter ended December 31, 2010 totaled $189,000, an increase of $33,000 or 21.2% compared to the same period in 2009.   For the six months ended December 31, 2010, non-interest income totaled $446,000, an increase of $123,000, or 38.1%, when compared to the same period in 2009.  The increase in non-interest income for the three month reporting period ended December 31, 2010 compared to December 31, 2009, was primarily attributed to unrealized gains in the trading security portfolio.  The increase for the six month period ended December 31, 2010 compared to December 31, 2009, was mostly attributed to $78,000 in fees that were received from the early prepayment of an investment security and a general overall increase in fees and service charges during the period.

Non-interest expense increased by $344,000 or 17.0% to $2.4 million for the three month period ended December 31, 2010 compared to $2.0 million for the three month period ended December 31, 2009.  For the six months ended December 31, 2010, non-interest expense totaled $4.5 million, compared to $4.1 million for the six months ended December 31, 2009, an increase of $455,000 or 11.2%.  The primary increase in non-interest expense for three and six month reporting periods ended December 31, 2010 compared to December 31, 2009, was attributed to an increase in other expense related to other real estate expense.  Other real estate expense increased by $143,000 and $171,000, as did other non-operating expense by $65,000 and $84,000, respectively, for the three and six month periods ended December 31, 2010, compared to the same periods ended December 31, 2009.  Other real estate expense consisted of property upkeep expense for both the three and six month periods ended December 31, 2010, whereas a loss on property sold was realized during the three month period ended December 31, 2010.  Salaries and benefits, directors’ compensation, and occupancy and equipment expense increased during both of these periods, as did FDIC assessment and service bureau fees.  Advertising expense increased slightly for the three month comparative period, while decreasing slightly for the six month comparative period ended December 31, 2010.

Total assets decreased to $350.6 million at December 31, 2010, from $358.7 million at June 30, 2010, primarily due to a decrease of $6.1 million in cash and cash equivalents and a $3.0 million decrease in loans receivable, net, offset by an increase of $1.4 million in securities held to maturity.  Deposits were $287.9 million at December 31, 2010, down $8.5 million compared to $296.4 million at June 30, 2010.   The decrease in deposit balances was primarily due to the Bank lowering its offering rates.  FHLB advances were $20.0 million at both December 31, and June 30, 2010.  Stockholders’ equity was $40.3 million at December 31, 2010, compared to $40.0 million at June 30, 2010.  The increase in shareholders’ equity was primarily due to earnings for the six months ended December 31, 2010, partially offset by dividends paid during the period.

Shares of the Company’s common stock trade on the NASDQ Global Market under the symbol “MSBF.” The Company is majority owned by its mutual holding company parent, MSB Financial, MHC.

 
 
 
 
 
Forward Looking Statements

The foregoing release may contain forward-looking statements concerning the financial condition, results of operations and business of the Company. We caution that such statements are subject to a number of uncertainties and actual results could differ materially, and, therefore, readers should not place undue reliance on any forward-looking statements.


CONTACT:
MSB Financial Corp.
  
 
Michael Shriner, Executive Vice President
  
 
908-647-4000
  
 
mshriner@millingtonsb.com
  
 
 
 
 
 
 
 
 
MSB FINANCIAL CORP
(Dollars in Thousands, except for per share amount)
         
SELECTED FINANCIAL AND OTHER DATA
         
         
Balance Sheet Data:
      
   
(Unaudited)
    At December 31,    At June 30,
   
2010
  
2010
         
            Total assets
  
$350,592
  
$358,743
         
            Cash and cash equivalents
15,007
  
21,144
         
            Loans receivable, net
262,780
  
265,814
         
            Securities held to maturity
48,858
  
47,477
         
            Deposits
  
287,929
  
296,401
         
            Federal Home Loan Bank advances
20,000
  
20,000
         
            Total stockholders' equity
40,324
  
39,968
 
 
 
 
 
 
 
 
Summary of Operations:
                        
   
(Unaudited)
    
(Unaudited)
  
   
For the Six
    
For the Three
  
   
Months Ended
    
Months Ended
  
   
December 31,
    
December 31,
    
December 31,
    
December 31,
  
   
2010
    
2009
    
2010
    
2009
  
                         
            Total interest income
   $ 7,729     $ 8,562     $ 3,826     $ 4,282  
                                 
            Total interest expense
     2,265       3,380       1,079       1,633  
                                 
            Net interest income
     5,464       5,182       2,747       2,649  
                                 
            Provision for loan losses
     825       750       350       405  
                                 
            Net interest income after provision
                                
              for loan losses
     4,639       4,432       2,397       2,244  
                                 
            Noninterest income
     446       323       189       156  
                                 
            Noninterest expense
     4,520       4,065       2,367       2,023  
                                 
            Income before taxes
     565       690       219       377  
                                 
            Income tax provision
     230       263       99       144  
                                 
            Net income
   $ 335     $ 427     $ 120     $ 233  
                                 
                                 
            Net income per common share:
                                
                                 
            basic and diluted
   $ 0.07     $ 0.08     $ 0.02     $ 0.05  
                                 
            Weighted average number of shares of common stock
     5,041,046       5,123,015       5,042,224       5,107,102  
            outstanding
                                
                                 
 
 
 
 
 
 
 
 
Performance Ratios:
              
       
(Unaudited)
  
(Unaudited)
       
For the Six
  
For the Three
       
Months Ended
  
Months Ended
         December 31,    December 31,    December 31,    December 31,
       
2010
  
2009
  
2010
  
2009
                     
 
Return on average assets (ratio of net income
          
 
to average total assets)
0.13%
  
0.16%
  
0.14%
  
0.26%
                     
 
Return on average equity (ratio of net income
  
 
      
 
 
to average equity)
1.11
  
1.39
  
1.19
  
2.29
                     
 
Net interest rate spread
3.31
  
2.90
  
3.34
  
2.98
                     
 
Net interest margin on average interest-earning
            
 
assets
    
3.41
  
3.10
  
3.45
  
3.15
                     
 
Average interest-earning assets to average
            
 
interest-bearing liabilities
106.69
  
109.60
  
107.48
  
108.67
                     
 
Operating expense ratio (noninterest expenses
            
 
to average total assets)
1.69
  
1.50
  
2.69
  
2.22
                     
 
Efficiency ratio (noninterest expense divided by
            
 
sum of net interest income and noninterest income)
76.48
  
73.84
  
80.62
  
72.12
                     
 
 
 
 
 
 
 
 
       
(Unaudited)
       
At or For the
       
Six Months Ended,
         December 31,    December 31,
       
2010
  
2009
Asset Quality Ratios:
      
             
 
Non-performing loans to total loans
6.13%
  
5.96%
             
 
Non-performing assets to total assets
5.10
  
4.62
             
 
Net charge-offs to average loans outstanding
0.10
  
0.03
             
 
Allowance for loan losses to non-performing loans
18.97
  
14.77
             
 
Allowance for loan losses to total loans
1.16
  
0.88
             
             
Capital Ratios:
        
       
 
    
 
Equity to total assets at end of period
11.50%
  
11.01%
             
 
Average equity to average assets
11.34
  
11.34
             
             
 
Number of Offices
5
  
5