Washington | __ 26-0610707___ |
(State or other jurisdiction of incorporation or organization | (I.R.S. Employer Identification Number) |
201 Wells Avenue South, Renton, Washington | 98057 |
(Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: | ____(425) 255-4400___ |
PART 1 - FINANCIAL INFORMATION | |
Item 1 - Financial Statements | 3 |
Item 2 - Management’s Discussion and Analysis of Financial Condition
and Results of Operations
|
39 |
Item 3 - Quantitative and Qualitative Disclosures About Market Risk | 57 |
Item 4 - Controls and Procedures | 60 |
PART II - OTHER INFORMATION | |
Item 1 - Legal Proceedings | 61 |
Item 1A - Risk Factors | 61 |
Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds | 61 |
Item 3 - Defaults upon Senior Securities | 61 |
Item 4 - Mine Safety Disclosures | 61 |
Item 5 - Other Information | 61 |
Item 6 - Exhibits | 61 |
SIGNATURES |
FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(Dollars in thousands, except share data)
(Unaudited)
|
September 30,
|
December 31,
|
|||||||
Assets
|
2012
|
2011
|
||||||
Cash on hand and in banks
|
$ | 5,265 | $ | 4,620 | ||||
Interest-bearing deposits
|
103,968 | 160,141 | ||||||
Investments available-for-sale, at fair value
|
158,959 | 129,002 | ||||||
Loans receivable, net of allowance of $14,168 and $16,559
|
650,348 | 703,288 | ||||||
Premises and equipment, net
|
18,259 | 18,922 | ||||||
Federal Home Loan Bank stock, at cost
|
7,347 | 7,413 | ||||||
Accrued interest receivable
|
3,730 | 3,856 | ||||||
Federal income tax receivable
|
60 | 1,060 | ||||||
Deferred tax assets
|
1,000 | - | ||||||
Other real estate owned ("OREO")
|
19,209 | 26,044 | ||||||
Prepaid expenses and other assets
|
4,908 | 5,044 | ||||||
Total assets
|
$ | 973,053 | $ | 1,059,390 | ||||
Liabilities and Stockholders' Equity
|
||||||||
Interest-bearing deposits
|
$ | 689,950 | $ | 782,652 | ||||
Noninterest-bearing deposits
|
6,147 | 6,013 | ||||||
Advances from the Federal Home Loan Bank
|
83,066 | 83,066 | ||||||
Advance payments from borrowers for taxes and insurance
|
4,164 | 2,093 | ||||||
Accrued interest payable
|
187 | 184 | ||||||
Other liabilities
|
4,577 | 4,062 | ||||||
Total liabilities
|
788,091 | 878,070 | ||||||
Commitments and contingencies
|
||||||||
Stockholders' Equity
|
||||||||
Preferred stock, $0.01 par value; authorized 10,000,000 shares,
|
||||||||
no shares issued or outstanding
|
- | - | ||||||
Common stock, $0.01 par value; authorized 90,000,000 shares;
|
||||||||
issued and outstanding 18,805,168 shares at September 30, 2012
|
||||||||
and December 31, 2011
|
188 | 188 | ||||||
Additional paid-in capital
|
190,085 | 188,816 | ||||||
Retained earnings, substantially restricted
|
5,139 | 3,937 | ||||||
Accumulated other comprehensive income, net of tax
|
835 | 511 | ||||||
Unearned Employee Stock Ownership Plan ("ESOP") shares
|
(11,285 | ) | (12,132 | ) | ||||
Total stockholders' equity
|
184,962 | 181,320 | ||||||
Total liabilities and stockholders' equity
|
$ | 973,053 | $ | 1,059,390 | ||||
See accompanying notes to consolidated financial statements.
|
FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(Dollars in thousands, except share data)(Unaudited)
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
Interest income
|
||||||||||||||||
Loans, including fees
|
$ | 9,539 | $ | 11,397 | $ | 29,813 | $ | 35,716 | ||||||||
Investments available-for-sale
|
507 | 926 | 1,600 | 3,393 | ||||||||||||
Interest-bearing deposits with banks
|
111 | 127 | 305 | 297 | ||||||||||||
Total interest income
|
$ | 10,157 | $ | 12,450 | $ | 31,718 | $ | 39,406 | ||||||||
Interest expense
|
||||||||||||||||
Deposits | 2,429 | 3,981 | 7,997 | 12,714 | ||||||||||||
Federal Home Loan Bank advances
|
517 | 589 | 1,539 | 1,748 | ||||||||||||
Total interest expense
|
$ | 2,946 | $ | 4,570 | $ | 9,536 | $ | 14,462 | ||||||||
Net interest income
|
7,211 | 7,880 | 22,182 | 24,944 | ||||||||||||
Provision for loan losses
|
700 | 1,300 | 3,050 | 4,100 | ||||||||||||
Net interest income after provision for loan losses
|
$ | 6,511 | $ | 6,580 | $ | 19,132 | $ | 20,844 | ||||||||
Noninterest income
|
||||||||||||||||
Net gain on sale of investments
|
- | 479 | 288 | 1,741 | ||||||||||||
Other | 107 | 77 | 430 | 237 | ||||||||||||
Total noninterest income
|
$ | 107 | $ | 556 | $ | 718 | $ | 1,978 | ||||||||
Noninterest expense
|
||||||||||||||||
Compensation and employee benefits
|
3,680 | 3,544 | 10,558 | 10,047 | ||||||||||||
Occupancy and equipment
|
391 | 370 | 1,191 | 1,167 | ||||||||||||
Professional fees
|
460 | 449 | 1,401 | 1,431 | ||||||||||||
Data processing
|
174 | 181 | 540 | 573 | ||||||||||||
Gain on sale of OREO property, net
|
(78 | ) | (293 | ) | (427 | ) | (1,427 | ) | ||||||||
OREO market value adjustments
|
1,157 | 515 | 1,702 | 1,432 | ||||||||||||
OREO related expenses, net
|
486 | 540 | 1,421 | 2,376 | ||||||||||||
Regulatory assessments
|
298 | 578 | 709 | 1,900 | ||||||||||||
Insurance and bond premiums
|
100 | 248 | 300 | 743 | ||||||||||||
Proxy contest and related litigation
|
264 | - | 868 | - | ||||||||||||
Marketing | 68 | 43 | 181 | 154 | ||||||||||||
Other general and administrative
|
457 | 338 | 1,203 | 1,111 | ||||||||||||
Total noninterest expense
|
$ | 7,457 | $ | 6,513 | $ | 19,647 | $ | 19,507 | ||||||||
Income (loss) before benefit for federal income taxes
|
(839 | ) | 623 | 203 | 3,315 | |||||||||||
Federal income tax benefit
|
(48 | ) | - | (999 | ) | - | ||||||||||
Net income (loss)
|
$ | (791 | ) | $ | 623 | $ | 1,202 | $ | 3,315 | |||||||
Basic income (loss) per share
|
$ | (0.04 | ) | $ | 0.04 | $ | 0.07 | $ | 0.19 | |||||||
Diluted income (loss) per share
|
$ | (0.04 | ) | $ | 0.04 | $ | 0.07 | $ | 0.19 | |||||||
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
Net income (loss)
|
$ | (791 | ) | $ | 623 | $ | 1,202 | $ | 3,315 | |||||||
Other comprehensive income (loss), before tax
|
||||||||||||||||
Unrealized holding gains on available-for-sale securities
|
815 | 402 | 612 | 2,060 | ||||||||||||
Reclassification adjustment for net gains realized in income
|
- | (479 | ) | (288 | ) | (1,741 | ) | |||||||||
Other comprehensive income (loss), before tax
|
815 | (77 | ) | 324 | 319 | |||||||||||
Income tax benefit related to items of other comprehensive income (loss)
|
- | 1,490 | - | 1,060 | ||||||||||||
Other comprehensive income (loss), net of tax
|
$ | 815 | $ | (1,567 | ) | $ | 324 | $ | (741 | ) | ||||||
Total comprehensive income (loss)
|
$ | 24 | $ | (944 | ) | $ | 1,526 | $ | 2,574 | |||||||
FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES
Consolidated Statements of Stockholders' Equity
For the Nine Months Ended September 30, 2012
(Dollars in thousands, except share data)
(Unaudited)
|
Accumulated
|
||||||||||||||||||||||||||||
Other
|
||||||||||||||||||||||||||||
Comprehensive
|
Total
|
|||||||||||||||||||||||||||
Common
|
Additional
|
Retained
|
Income,
|
Unearned
|
Stockholders'
|
|||||||||||||||||||||||
Shares
|
Stock
|
Paid-in Capital
|
Earnings
|
Net of Tax
|
ESOP Shares
|
Equity
|
||||||||||||||||||||||
Balances at December 31, 2011
|
18,805,168 | $ | 188 | $ | 188,816 | $ | 3,937 | $ | 511 | $ | (12,132 | ) | $ | 181,320 | ||||||||||||||
Total other comprehensive
income, net of tax
|
- | - | - | 1,202 | 324 | - | 1,526 | |||||||||||||||||||||
Compensation related to stock options
|
||||||||||||||||||||||||||||
and restricted stock awards
|
- | - | 1,472 | - | - | - | 1,472 | |||||||||||||||||||||
Allocation of 84,640 ESOP shares
|
- | - | (203 | ) | - | - | 847 | 644 | ||||||||||||||||||||
Balances at September 30, 2012
|
18,805,168 | $ | 188 | $ | 190,085 | $ | 5,139 | $ | 835 | $ | (11,285 | ) | $ | 184,962 | ||||||||||||||
FIRST FINANCIAL NORTHWEST, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
|
Nine Months Ended September 30,
|
||||||||||||
2012
|
2011
|
|||||||||||
Cash flows from operating activities:
|
||||||||||||
Net income
|
$
|
1,202
|
$
|
3,315
|
||||||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||||||
Provision for loan losses
|
3,050
|
4,100
|
||||||||||
OREO market value adjustments
|
1,702
|
1,432
|
||||||||||
Gain on sale of OREO property, net
|
(427)
|
(1,427)
|
||||||||||
Depreciation of premises and equipment
|
767
|
792
|
||||||||||
Net amortization of premiums and discounts on investments
|
1,260
|
1,835
|
||||||||||
ESOP expense
|
644
|
446
|
||||||||||
Compensation expense related to stock options and restricted stock awards
|
1,472
|
1,489
|
||||||||||
Net realized gain on investments available-for-sale
|
(288)
|
(1,741)
|
||||||||||
Loss from disposal of premises and equipment
|
9
|
-
|
||||||||||
Deferred federal income taxes
|
(1,000)
|
(1,061)
|
||||||||||
Changes in operating assets and liabilities:
|
||||||||||||
Prepaid expenses and other assets
|
136
|
1,222
|
||||||||||
Federal income taxes, net
|
1,000
|
5,916
|
||||||||||
Accrued interest receivable
|
126
|
714
|
||||||||||
Accrued interest payable
|
3
|
14
|
||||||||||
Other liabilities
|
515
|
513
|
||||||||||
Investment transactions payable
|
-
|
10,000
|
||||||||||
Net cash provided by operating activities
|
$
|
10,171
|
$
|
27,559
|
||||||||
Cash flows from investing activities:
|
||||||||||||
Proceeds from sales or calls of investments
|
23,200
|
74,633
|
||||||||||
Reimbursed (capitalized) improvements on OREO
|
16
|
(181)
|
||||||||||
Proceeds from sales of OREO properties
|
15,067
|
25,814
|
||||||||||
Principal repayments on investments
|
15,734
|
24,602
|
||||||||||
Purchases of investments
|
(69,539)
|
(74,679)
|
||||||||||
Net decrease in loans receivable
|
40,367
|
104,393
|
||||||||||
FHLB stock dividend redemption
|
66
|
-
|
||||||||||
Purchases of premises and equipment
|
(113)
|
(55)
|
||||||||||
Net cash provided by investing activities
|
$
|
24,798
|
$
|
154,527
|
||||||||
Balance, carried forward
|
$
|
34,969
|
$
|
182,086
|
Nine Months Ended September 30,
|
||||||||||||
2012
|
2011
|
|||||||||||
Balance, brought forward
|
$
|
34,969
|
$
|
182,086
|
||||||||
Cash flows from financing activities:
|
||||||||||||
Net decrease in deposits
|
(92,568)
|
(69,681)
|
||||||||||
Advances from the Federal Home Loan Bank
|
110
|
-
|
||||||||||
Repayments of advances from the Federal Home Loan Bank
|
(110)
|
-
|
||||||||||
Net increase in advance payments from borrowers for taxes and insurance
|
2,071
|
1,367
|
||||||||||
Net cash used by financing activities
|
$
|
(90,497)
|
$
|
(68,314)
|
||||||||
Net increase (decrease) in cash
|
(55,528)
|
113,772
|
||||||||||
Cash and cash equivalents:
|
||||||||||||
Beginning of period
|
164,761
|
98,427
|
||||||||||
End of period
|
$
|
109,233
|
$
|
212,199
|
||||||||
Supplemental disclosures of cash flow information:
|
||||||||||||
Cash paid during the period for:
|
||||||||||||
Interest
|
$
|
9,533
|
$
|
14,448
|
||||||||
Federal income taxes
|
$
|
60
|
$
|
-
|
||||||||
Noncash transactions:
|
||||||||||||
Loans, net of deferred loan fees and allowance for loan losses, transferred to OREO
|
$
|
9,523
|
$
|
20,737
|
||||||||
September 30, 2012
|
||||||||||||||||
Gross
|
Gross
|
|||||||||||||||
Amortized
|
Unrealized
|
Unrealized
|
||||||||||||||
Cost
|
Gains
|
Losses
|
Fair Value
|
|||||||||||||
(In thousands)
|
||||||||||||||||
Mortgage-backed investments:
|
||||||||||||||||
Fannie Mae
|
$ | 38,253 | $ | 1,341 | $ | (1 | ) | $ | 39,593 | |||||||
Freddie Mac
|
16,439 | 376 | - | 16,815 | ||||||||||||
Ginnie Mae
|
33,199 | 90 | (124 | ) | 33,165 | |||||||||||
Municipal bonds
|
2,049 | 11 | (233 | ) | 1,827 | |||||||||||
U.S. Government sponsored entities and agencies
|
67,395 | 191 | (27 | ) | 67,559 | |||||||||||
Total
|
$ | 157,335 | $ | 2,009 | $ | (385 | ) | $ | 158,959 | |||||||
December 31, 2011
|
||||||||||||||||
Gross
|
Gross
|
|||||||||||||||
Amortized
|
Unrealized
|
Unrealized
|
||||||||||||||
Cost
|
Gains
|
Losses
|
Fair Value
|
|||||||||||||
(In thousands)
|
||||||||||||||||
Mortgage-backed investments:
|
||||||||||||||||
Fannie Mae
|
$ | 50,981 | $ | 1,182 | $ | - | $ | 52,163 | ||||||||
Freddie Mac
|
19,285 | 560 | - | 19,845 | ||||||||||||
Ginnie Mae
|
7,416 | 79 | - | 7,495 | ||||||||||||
Municipal bonds
|
2,085 | 32 | (270 | ) | 1,847 | |||||||||||
U.S. Government sponsored entities and agencies
|
47,934 | 2 | (284 | ) | 47,652 | |||||||||||
Total
|
$ | 127,701 | $ | 1,855 | $ | (554 | ) | $ | 129,002 | |||||||
September 30, 2012
|
||||||||||||||||||||||||
Less Than 12 Months
|
12 Months or Longer
|
Total
|
||||||||||||||||||||||
Unrealized
|
Unrealized
|
Unrealized
|
||||||||||||||||||||||
Fair Value
|
Loss
|
Fair Value
|
Loss
|
Fair Value
|
Loss
|
|||||||||||||||||||
(In thousands)
|
||||||||||||||||||||||||
Mortgage-backed investments:
|
||||||||||||||||||||||||
Fannie Mae
|
$ | 4,892 | $ | (1 | ) | $ | - | $ | - | $ | 4,892 | $ | (1 | ) | ||||||||||
Ginnie Mae
|
16,358 | (124 | ) | - | - | 16,358 | (124 | ) | ||||||||||||||||
Municipal bonds
|
- | - | 1,173 | (233 | ) | 1,173 | (233 | ) | ||||||||||||||||
U.S Government sponsored
|
||||||||||||||||||||||||
entities and agencies
|
12,883 | (27 | ) | - | - | 12,883 | (27 | ) | ||||||||||||||||
Total
|
$ | 34,133 | $ | (152 | ) | $ | 1,173 | $ | (233 | ) | $ | 35,306 | $ | (385 | ) | |||||||||
December 31, 2011 | ||||||||||||||||||||||||
Less Than 12 Months
|
12 Months or Longer
|
Total
|
||||||||||||||||||||||
Unrealized
|
Unrealized
|
Unrealized
|
||||||||||||||||||||||
Fair Value
|
Loss
|
Fair Value
|
Loss
|
Fair Value
|
Loss
|
|||||||||||||||||||
(In thousands)
|
||||||||||||||||||||||||
Municipal bonds
|
$ | - | $ | - | $ | 1,137 | $ | (270 | ) | $ | 1,137 | $ | (270 | ) | ||||||||||
U.S. Government sponsored
|
||||||||||||||||||||||||
entities and agencies
|
45,039 | (284 | ) | - | - | 45,039 | (284 | ) | ||||||||||||||||
Total
|
$ | 45,039 | $ | (284 | ) | $ | 1,137 | $ | (270 | ) | $ | 46,176 | $ | (554 | ) |
September 30, 2012
|
||||||||
Amortized Cost
|
Fair Value
|
|||||||
(In thousands)
|
||||||||
Due after one year through five years
|
$ | 50,053 | $ | 50,078 | ||||
Due after five years through ten years
|
4,722 | 4,760 | ||||||
Due after ten years
|
14,669 | 14,548 | ||||||
69,444 | 69,386 | |||||||
Mortgage-backed investments
|
87,891 | 89,573 | ||||||
Total
|
$ | 157,335 | $ | 158,959 |
September 30, 2012
|
December 31, 2011
|
|||||||
(In thousands)
|
||||||||
One-to-four family residential: (1)
|
$ | 313,562 | $ | 335,412 | ||||
Multifamily:
|
||||||||
Permanent
|
107,575 | 110,148 | ||||||
Construction
|
- | 3,526 | ||||||
107,575 | 113,674 | |||||||
Commercial real estate:
|
||||||||
Permanent
|
200,490 | 218,032 | ||||||
Construction
|
12,500 | 12,500 | ||||||
Land | 1,947 | 1,811 | ||||||
214,937 | 232,343 | |||||||
Construction/land development: (2)
|
||||||||
One-to-four family residential
|
1,625 | 6,194 | ||||||
Multifamily
|
806 | 855 | ||||||
Commercial
|
- | 1,104 | ||||||
Land development
|
14,435 | 16,990 | ||||||
16,866 | 25,143 | |||||||
Business
|
3,503 | 3,909 | ||||||
Consumer
|
10,778 | 12,499 | ||||||
Total loans
|
667,221 | 722,980 | ||||||
Less:
|
||||||||
Loans in process
|
931 | 1,372 | ||||||
Deferred loan fees, net
|
1,774 | 1,761 | ||||||
ALLL | 14,168 | 16,559 | ||||||
Loans receivable, net
|
$ | 650,348 | $ | 703,288 |
(1)
|
Includes $144.5 million and $147.4 million of non-owner occupied loans at
September 30, 2012 and December 31, 2011, respectively.
|
||||||||||
(2) Excludes construction loans that will convert to permanent loans. We consider
|
|||||||||||
these loans to be "rollovers" in that one loan is originated for both the construction
|
|||||||||||
loan and permanent financing. These loans are classified according to the underlying
|
|||||||||||
collateral. As a result, at September 30, 2012, we had $12.5 million, or 5.8% of our total
|
|||||||||||
commercial real estate portfolio and no multifamily loans in these "rollover" type of
|
|||||||||||
loans. At December 31, 2011, we had $12.5 milllion, or 5.4% of our total commercial
|
|||||||||||
real estate portfolio and $3.5 million, or 3.1% of our total multifamily loan portfolio
|
|||||||||||
in these "rollover" type of loans. At September 30, 2012 and December 31, 2011, $1.9
|
|||||||||||
million and $1.8 million, respectively, of commercial real estate land loans were not
|
|||||||||||
included in the construction/land development category because we classify
|
|||||||||||
our buildable lots where we do not intend to finance the construction as commercial
|
|||||||||||
real estate land loans.
|
At or For the Three Months Ended September 30, 2012
|
||||||||||||||||||||||||||||
One-to-Four | Construction/ | |||||||||||||||||||||||||||
Family
|
Commercial
|
Land
|
||||||||||||||||||||||||||
Residential
|
Multifamily
|
Real Estate
|
Development
|
Business
|
Consumer
|
Total
|
||||||||||||||||||||||
ALLL:
|
(In thousands)
|
|||||||||||||||||||||||||||
Beginning balance
|
$ | 5,966 | $ | 2,024 | $ | 5,634 | $ | 567 | $ | 35 | $ | 224 | $ | 14,450 | ||||||||||||||
Charge-offs
|
(681 | ) | - | (1,313 | ) | (149 | ) | - | (198 | ) | (2,341 | ) | ||||||||||||||||
Recoveries
|
- | - | 3 | 1,355 | - | 1 | 1,359 | |||||||||||||||||||||
Provision
|
863 | (707 | ) | 1,623 | (1,275 | ) | - | 196 | 700 | |||||||||||||||||||
Ending balance
|
$ | 6,148 | $ | 1,317 | $ | 5,947 | $ | 498 | $ | 35 | $ | 223 | $ | 14,168 | ||||||||||||||
General reserve
|
$ | 4,831 | $ | 1,317 | $ | 5,741 | $ | 498 | $ | 35 | $ | 223 | $ | 12,645 | ||||||||||||||
Specific reserve
|
$ | 1,317 | $ | - | $ | 206 | $ | - | $ | - | $ | - | $ | 1,523 | ||||||||||||||
Loans: (1)
|
||||||||||||||||||||||||||||
Total Loans
|
$ | 313,562 | $ | 107,575 | $ | 214,937 | $ | 15,935 | $ | 3,503 | $ | 10,778 | $ | 666,290 | ||||||||||||||
General reserve (2)
|
$ | 252,649 | $ | 101,621 | $ | 201,591 | $ | 7,938 | $ | 3,503 | $ | 10,637 | $ | 577,939 | ||||||||||||||
Specific reserve (3)
|
$ | 60,913 | $ | 5,954 | $ | 13,346 | $ | 7,997 | $ | - | $ | 141 | $ | 88,351 | ||||||||||||||
(1) Net of undisbursed funds.
|
||||||||||||||||||||||||||||
(2) Loans collectively evaluated for impairment.
|
||||||||||||||||||||||||||||
(3) Loans individually evaluated for impairment.
|
||||||||||||||||||||||||||||
At or For the Nine Months Ended September 30, 2012
|
||||||||||||||||||||||||||||
One-to-Four | Construction/ | |||||||||||||||||||||||||||
Family
|
Commercial
|
Land
|
||||||||||||||||||||||||||
Residential
|
Multifamily
|
Real Estate
|
Development
|
Business
|
Consumer
|
Total
|
||||||||||||||||||||||
ALLL:
|
(In thousands) | |||||||||||||||||||||||||||
Beginning balance
|
$ | 5,756 | $ | 950 | $ | 6,846 | $ | 2,503 | $ | 154 | $ | 350 | $ | 16,559 | ||||||||||||||
Charge-offs
|
(2,018 | ) | (153 | ) | (4,409 | ) | (318 | ) | - | (491 | ) | (7,389 | ) | |||||||||||||||
Recoveries
|
12 | - | 475 | 1,457 | - | 4 | 1,948 | |||||||||||||||||||||
Provision
|
2,398 | 520 | 3,035 | (3,144 | ) | (119 | ) | 360 | 3,050 | |||||||||||||||||||
Ending balance
|
$ | 6,148 | $ | 1,317 | $ | 5,947 | $ | 498 | $ | 35 | $ | 223 | $ | 14,168 | ||||||||||||||
General reserve
|
$ | 4,831 | $ | 1,317 | $ | 5,741 | $ | 498 | $ | 35 | $ | 223 | $ | 12,645 | ||||||||||||||
Specific reserve
|
$ | 1,317 | $ | - | $ | 206 | $ | - | $ | - | $ | - | $ | 1,523 | ||||||||||||||
Loans: (1)
|
||||||||||||||||||||||||||||
Total Loans
|
$ | 313,562 | $ | 107,575 | $ | 214,937 | $ | 15,935 | $ | 3,503 | $ | 10,778 | $ | 666,290 | ||||||||||||||
General reserve (2)
|
$ | 252,649 | $ | 101,621 | $ | 201,591 | $ | 7,938 | $ | 3,503 | $ | 10,637 | $ | 577,939 | ||||||||||||||
Specific reserve (3)
|
$ | 60,913 | $ | 5,954 | $ | 13,346 | $ | 7,997 | $ | - | $ | 141 | $ | 88,351 | ||||||||||||||
(1) Net of undisbursed funds.
|
||||||||||||||||||||||||||||
(2) Loans collectively evaluated for impairment.
|
||||||||||||||||||||||||||||
(3) Loans individually evaluated for impairment.
|
At or For the Three Months Ended September 30, 2011
|
||||||||||||||||||||||||||||
One-to-Four | Construction/ | |||||||||||||||||||||||||||
Family
|
Commercial
|
Land
|
||||||||||||||||||||||||||
Residential
|
Multifamily
|
Real Estate
|
Development
|
Business
|
Consumer
|
Total
|
||||||||||||||||||||||
ALLL:
|
(In thousands)
|
|||||||||||||||||||||||||||
Beginning balance
|
$ | 5,499 | $ | 984 | $ | 7,279 | $ | 2,893 | $ | 14 | $ | 320 | $ | 16,989 | ||||||||||||||
Charge-offs
|
(371 | ) | - | (590 | ) | (633 | ) | - | (92 | ) | (1,686 | ) | ||||||||||||||||
Recoveries
|
12 | - | - | 18 | - | 1 | 31 | |||||||||||||||||||||
Provision
|
164 | 5 | 429 | 457 | 127 | 118 | 1,300 | |||||||||||||||||||||
Ending balance
|
$ | 5,304 | $ | 989 | $ | 7,118 | $ | 2,735 | $ | 141 | $ | 347 | $ | 16,634 | ||||||||||||||
General reserve
|
$ | 4,739 | $ | 989 | $ | 7,074 | $ | 2,735 | $ | 141 | $ | 347 | $ | 16,025 | ||||||||||||||
Specific reserve
|
$ | 565 | $ | - | $ | 44 | $ | - | $ | - | $ | - | $ | 609 | ||||||||||||||
Loans: (1)
|
||||||||||||||||||||||||||||
Total Loans
|
$ | 346,222 | $ | 116,461 | $ | 236,775 | $ | 28,821 | $ | 3,531 | $ | 13,898 | $ | 745,708 | ||||||||||||||
General reserve (2)
|
$ | 280,334 | $ | 113,311 | $ | 220,966 | $ | 16,930 | $ | 3,531 | $ | 13,784 | $ | 648,856 | ||||||||||||||
Specific reserve (3)
|
$ | 65,888 | $ | 3,150 | $ | 15,809 | $ | 11,891 | $ | - | $ | 114 | $ | 96,852 | ||||||||||||||
(1) Net of undisbursed funds.
|
||||||||||||||||||||||||||||
(2) Loans collectively evaluated for impairment.
|
||||||||||||||||||||||||||||
(3) Loans individually evaluated for impairment.
|
||||||||||||||||||||||||||||
At or For the Nine Months Ended September 30, 2011
|
||||||||||||||||||||||||||||
One-to-Four | Construction/ | |||||||||||||||||||||||||||
Family
|
Commercial
|
Land
|
||||||||||||||||||||||||||
Residential
|
Multifamily
|
Real Estate
|
Development
|
Business
|
Consumer
|
Total
|
||||||||||||||||||||||
ALLL:
|
(In thousands)
|
|||||||||||||||||||||||||||
Beginning balance
|
$ | 8,302 | $ | 1,893 | $ | 6,742 | $ | 5,151 | $ | 7 | $ | 439 | $ | 22,534 | ||||||||||||||
Charge-offs
|
(1,987 | ) | (88 | ) | (4,184 | ) | (3,815 | ) | - | (263 | ) | (10,337 | ) | |||||||||||||||
Recoveries
|
31 | - | - | 304 | - | 2 | 337 | |||||||||||||||||||||
Provision
|
(1,042 | ) | (816 | ) | 4,560 | 1,095 | 134 | 169 | 4,100 | |||||||||||||||||||
Ending balance
|
$ | 5,304 | $ | 989 | $ | 7,118 | $ | 2,735 | $ | 141 | $ | 347 | $ | 16,634 | ||||||||||||||
General reserve
|
$ | 4,739 | $ | 989 | $ | 7,074 | $ | 2,735 | $ | 141 | $ | 347 | $ | 16,025 | ||||||||||||||
Specific reserve
|
$ | 565 | $ | - | $ | 44 | $ | - | $ | - | $ | - | $ | 609 | ||||||||||||||
Loans: (1)
|
||||||||||||||||||||||||||||
Total Loans
|
$ | 346,222 | $ | 116,461 | $ | 236,775 | $ | 28,821 | $ | 3,531 | $ | 13,898 | $ | 745,708 | ||||||||||||||
General reserve (2)
|
$ | 280,334 | $ | 113,311 | $ | 220,966 | $ | 16,930 | $ | 3,531 | $ | 13,784 | $ | 648,856 | ||||||||||||||
Specific reserve (3)
|
$ | 65,888 | $ | 3,150 | $ | 15,809 | $ | 11,891 | $ | - | $ | 114 | $ | 96,852 | ||||||||||||||
(1) Net of undisbursed funds.
|
||||||||||||||||||||||||||||
(2) Loans collectively evaluated for impairment.
|
||||||||||||||||||||||||||||
(3) Loans individually evaluated for impairment.
|
September 30, 2012
|
|||||||||||||
Unpaid
|
|||||||||||||
Recorded
|
Principal
|
Related
|
|||||||||||
Investment (1) |
Balance (2)
|
Allowance
|
|||||||||||
(In thousands)
|
|||||||||||||
Loans with no related allowance:
|
|||||||||||||
One-to-four family residential:
|
|||||||||||||
Owner occupied
|
$ | 6,437 | $ | 7,538 | $ | - | |||||||
Non-owner occupied
|
35,339 | 35,742 | - | ||||||||||
Multifamily
|
5,954 | 6,136 | - | ||||||||||
Commercial real estate
|
7,647 | 10,900 | - | ||||||||||
Construction/land development
|
7,997 | 12,671 | - | ||||||||||
Consumer
|
141 | 176 | - | ||||||||||
Total
|
63,515 | 73,163 | - | ||||||||||
Loans with an allowance:
|
|||||||||||||
One-to-four family residential:
|
|||||||||||||
Owner occupied
|
5,376 | 5,547 | 377 | ||||||||||
Non-owner occupied
|
13,761 | 13,965 | 940 | ||||||||||
Commercial real estate
|
5,699 | 5,699 | 206 | ||||||||||
Total
|
24,836 | 25,211 | 1,523 | ||||||||||
Total impaired loans:
|
|||||||||||||
One-to-four family residential:
|
|||||||||||||
Owner occupied
|
11,813 | 13,085 | 377 | ||||||||||
Non-owner occupied
|
49,100 | 49,707 | 940 | ||||||||||
Multifamily
|
5,954 | 6,136 | - | ||||||||||
Commercial real estate
|
13,346 | 16,599 | 206 | ||||||||||
Construction/land development
|
7,997 | 12,671 | - | ||||||||||
Consumer
|
141 | 176 | - | ||||||||||
Total
|
$ | 88,351 | $ | 98,374 | $ | 1,523 |
_________ | |||||||||||||
(1)
|
Represents the loan balance less charge-offs.
|
||||||||||||
(2)
|
Contractual loan principal balance.
|
December 31, 2011
|
|||||||||||||
Unpaid
|
|||||||||||||
Recorded
|
Principal
|
Related
|
|||||||||||
Investment (1)
|
Balance (2)
|
Allowance
|
|||||||||||
(In thousands)
|
|||||||||||||
Loans with no related allowance:
|
|||||||||||||
One-to-four family residential:
|
|||||||||||||
Owner occupied
|
$ | 8,007 | $ | 8,931 | $ | - | |||||||
Non-owner occupied
|
40,406 | 42,794 | - | ||||||||||
Multifamily
|
3,453 | 3,578 | - | ||||||||||
Commercial real estate
|
12,802 | 15,957 | - | ||||||||||
Construction/land development
|
9,199 | 22,776 | - | ||||||||||
Consumer
|
70 | 70 | - | ||||||||||
Total
|
73,937 | 94,106 | - | ||||||||||
Loans with an allowance:
|
|||||||||||||
One-to-four family residential:
|
|||||||||||||
Owner occupied
|
4,588 | 4,724 | 180 | ||||||||||
Non-owner occupied
|
9,575 | 9,735 | 325 | ||||||||||
Commercial real estate
|
1,817 | 1,817 | 59 | ||||||||||
Total
|
15,980 | 16,276 | 564 | ||||||||||
Total impaired loans:
|
|||||||||||||
One-to-four family residential:
|
|||||||||||||
Owner occupied
|
12,595 | 13,655 | 180 | ||||||||||
Non-owner occupied
|
49,981 | 52,529 | 325 | ||||||||||
Multifamily
|
3,453 | 3,578 | - | ||||||||||
Commercial real estate
|
14,619 | 17,774 | 59 | ||||||||||
Construction/land development
|
9,199 | 22,776 | - | ||||||||||
Consumer
|
70 | 70 | - | ||||||||||
Total
|
$ | 89,917 | $ | 110,382 | $ | 564 |
__________ | |||||||||||||
(1)
|
Represents the loan balance less charge-offs.
|
||||||||||||
(2)
|
Contractual loan principal balance.
|
||||||||||||
Three Months Ended September 30, 2012
|
Nine Months Ended September 30, 2012
|
|||||||||||||||
Average
|
Interest
|
Average
|
Interest
|
|||||||||||||
Recorded
|
Income
|
Recorded
|
Income
|
|||||||||||||
Investment (1)
|
Recognized
|
Investment (1)
|
Recognized
|
|||||||||||||
(In thousands)
|
||||||||||||||||
Loans with no related allowance:
|
||||||||||||||||
One-to-four family residential:
|
||||||||||||||||
Owner occupied
|
$
|
7,284
|
$
|
46
|
$
|
7,813
|
$
|
119
|
||||||||
Non-owner occupied
|
36,147
|
497
|
37,738
|
1,545
|
||||||||||||
Multifamily
|
4,620
|
143
|
4,035
|
234
|
||||||||||||
Commercial real estate
|
8,106
|
75
|
11,411
|
255
|
||||||||||||
Construction/land development
|
8,364
|
-
|
8,729
|
-
|
||||||||||||
Consumer
|
211
|
1
|
182
|
3
|
||||||||||||
Total |
64,732
|
762
|
69,908
|
2,156
|
||||||||||||
Loans with an allowance:
|
||||||||||||||||
One-to-four family residential:
|
||||||||||||||||
Owner occupied
|
4,814
|
56
|
4,617
|
185
|
||||||||||||
Non-owner occupied
|
11,615
|
298
|
10,489
|
519
|
||||||||||||
Commercial real estate
|
5,709
|
73
|
3,885
|
212
|
||||||||||||
Total |
22,138
|
427
|
18,991
|
916
|
||||||||||||
Total impaired loans:
|
||||||||||||||||
One-to-four family residential:
|
||||||||||||||||
Owner occupied
|
12,098
|
102
|
12,430
|
304
|
||||||||||||
Non-owner occupied
|
47,762
|
795
|
48,227
|
2,064
|
||||||||||||
Multifamily
|
4,620
|
143
|
4,035
|
234
|
||||||||||||
Commercial real estate
|
13,815
|
148
|
15,296
|
467
|
||||||||||||
Construction/land development
|
8,364
|
-
|
8,729
|
-
|
||||||||||||
Consumer
|
211
|
1
|
182
|
3
|
||||||||||||
Total |
$
|
86,870
|
$
|
1,189
|
$
|
88,899
|
$
|
3,072
|
Three Months Ended September 30, 2011
|
Nine Months Ended September 30, 2011
|
|||||||||||||||
Average
|
Interest
|
Average
|
Interest
|
|||||||||||||
Recorded
|
Income
|
Recorded
|
Income
|
|||||||||||||
Investment (1)
|
Recognized
|
Investment (1)
|
Recognized
|
|||||||||||||
(In thousands)
|
||||||||||||||||
Loans with no related allowance:
|
||||||||||||||||
One-to-four family residential:
|
||||||||||||||||
Owner occupied
|
$
|
7,618
|
$
|
40
|
$
|
7,747
|
$
|
126
|
||||||||
Non-owner occupied
|
44,759
|
552
|
44,858
|
1,683
|
||||||||||||
Multifamily
|
3,154
|
42
|
2,833
|
126
|
||||||||||||
Commercial real estate
|
13,311
|
112
|
11,744
|
329
|
||||||||||||
Construction/land development
|
13,786
|
-
|
11,687
|
-
|
||||||||||||
Consumer
|
114
|
1
|
123
|
2
|
||||||||||||
Total
|
82,742
|
747
|
78,992
|
2,266
|
||||||||||||
Loans with an allowance:
|
||||||||||||||||
One-to-four family residential:
|
||||||||||||||||
Owner occupied
|
5,207
|
57
|
5,216
|
193
|
||||||||||||
Non-owner occupied
|
8,683
|
194
|
9,410
|
384
|
||||||||||||
Multifamily
|
-
|
-
|
175
|
-
|
||||||||||||
Commercial real estate
|
3,742
|
47
|
6,594
|
151
|
||||||||||||
Construction/land development
|
-
|
-
|
9,332
|
-
|
||||||||||||
Consumer
|
-
|
-
|
20
|
-
|
||||||||||||
Total
|
17,632
|
298
|
30,747
|
728
|
||||||||||||
Total impaired loans:
|
||||||||||||||||
One-to-four family residential:
|
||||||||||||||||
Owner occupied
|
12,825
|
97
|
12,963
|
319
|
||||||||||||
Non-owner occupied
|
53,442
|
746
|
54,268
|
2,067
|
||||||||||||
Multifamily
|
3,154
|
42
|
3,008
|
126
|
||||||||||||
Commercial real estate
|
17,053
|
159
|
18,338
|
480
|
||||||||||||
Construction/land development
|
13,786
|
-
|
21,019
|
-
|
||||||||||||
Consumer
|
114
|
1
|
143
|
2
|
||||||||||||
Total
|
$
|
100,374
|
$
|
1,045
|
$
|
109,739
|
$
|
2,994
|
September 30,
|
December 31,
|
|||||||
2012
|
2011
|
|||||||
(In thousands)
|
||||||||
Nonperforming assets (1):
|
||||||||
Nonaccrual loans
|
$ | 18,570 | $ | 18,613 | ||||
Nonaccrual TDRs
|
5,013 | 5,079 | ||||||
Total nonaccrual loans
|
23,583 | 23,692 | ||||||
OREO | 19,209 | 26,044 | ||||||
Total nonperforming assets
|
$ | 42,792 | $ | 49,736 | ||||
Performing TDRs
|
$ | 64,768 | $ | 66,225 | ||||
Nonaccrual TDRs
|
5,013 | 5,079 | ||||||
Total TDRs
|
$ | 69,781 | $ | 71,304 | ||||
_____________ | ||||||||
(1) There were no loans 90 days or more past due and still accruing interest at September 30, 2012 and December 31, 2011.
|
September 30,
|
December 31,
|
|||||||||
2012
|
2011
|
|||||||||
(In thousands)
|
||||||||||
One-to-four family residential
|
$
|
8,447
|
$
|
9,808
|
||||||
Multifamily
|
4,711
|
949
|
||||||||
Commercial real estate
|
2,287
|
3,736
|
||||||||
Construction/land development
|
7,997
|
9,199
|
||||||||
Consumer
|
141
|
-
|
||||||||
Total nonaccrual loans
|
$
|
23,583
|
$
|
23,692
|
Loans Past Due at September 30, 2012
|
||||||||||||||||||||||||
30-59 Days | 60-89 Days |
90 Days
and Greater
|
Total
|
Current
|
Total Loans
(1) (2)
|
|||||||||||||||||||
(In thousands)
|
||||||||||||||||||||||||
Real estate:
|
||||||||||||||||||||||||
One-to-four family residential:
|
||||||||||||||||||||||||
Owner occupied
|
$ | 2,376 | $ | 672 | $ | 4,008 | $ | 7,056 | $ | 161,995 | $ | 169,051 | ||||||||||||
Non-owner occupied
|
- | - | 885 | 885 | 143,626 | 144,511 | ||||||||||||||||||
Multifamily
|
1,800 | 2,703 | - | 4,503 | 103,072 | 107,575 | ||||||||||||||||||
Commercial real estate
|
4,803 | 129 | 1,934 | 6,866 | 208,071 | 214,937 | ||||||||||||||||||
Construction/land development
|
166 | - | 4,015 | 4,181 | 11,754 | 15,935 | ||||||||||||||||||
Total real estate
|
9,145 | 3,504 | 10,842 | 23,491 | 628,518 | 652,009 | ||||||||||||||||||
Business
|
- | - | - | - | 3,503 | 3,503 | ||||||||||||||||||
Consumer
|
345 | 644 | 119 | 1,108 | 9,670 | 10,778 | ||||||||||||||||||
Total
|
$ | 9,490 | $ | 4,148 | $ | 10,961 | $ | 24,599 | $ | 641,691 | $ | 666,290 | ||||||||||||
(1) There were no loans 90 days or more past due and still accruing interest at September 30, 2012.
|
||||||||||||||||||||||||
(2) Net of undisbursed funds.
|
||||||||||||||||||||||||
Loans Past Due at December 31, 2011
|
||||||||||||||||||||||||
30-59 Days
|
60-89 Days
|
90 Days
and Greater
|
Total
|
Current
|
Total Loans
(1) (2)
|
|||||||||||||||||||
(In thousands)
|
||||||||||||||||||||||||
Real estate:
|
||||||||||||||||||||||||
One-to-four family residential:
|
||||||||||||||||||||||||
Owner occupied
|
$ | 2,594 | $ | 1,318 | $ | 4,076 | $ | 7,988 | $ | 180,009 | $ | 187,997 | ||||||||||||
Non-owner occupied
|
761 | - | 3,224 | 3,985 | 143,394 | 147,379 | ||||||||||||||||||
Multifamily
|
- | - | 949 | 949 | 112,314 | 113,263 | ||||||||||||||||||
Commercial real estate
|
633 | - | 2,621 | 3,254 | 228,583 | 231,837 | ||||||||||||||||||
Construction/land development
|
- | - | 9,199 | 9,199 | 15,525 | 24,724 | ||||||||||||||||||
Total real estate
|
3,988 | 1,318 | 20,069 | 25,375 | 679,825 | 705,200 | ||||||||||||||||||
Business
|
240 | - | - | 240 | 3,669 | 3,909 | ||||||||||||||||||
Consumer
|
1,133 | - | - | 1,133 | 11,366 | 12,499 | ||||||||||||||||||
Total
|
$ | 5,361 | $ | 1,318 | $ | 20,069 | $ | 26,748 | $ | 694,860 | $ | 721,608 | ||||||||||||
(1) There were no loans 90 days or more past due and still accruing interest at December 31, 2011.
|
||||||||||||||||||||||||
(2) Net of undisbursed funds.
|
September 30, 2012
|
|||||||||||||||||||||||||
One-to-Four
Family
Residential
|
Multifamily
|
Commercial
Real Estate
|
Construction/
Land
Development
|
Business
|
Consumer
|
Total (1)
|
|||||||||||||||||||
(In thousands)
|
|||||||||||||||||||||||||
Risk Rating:
|
|||||||||||||||||||||||||
Pass
|
$
|
289,037
|
$
|
101,621
|
$
|
193,505
|
$
|
7,772
|
$
|
3,503
|
$
|
9,778
|
$
|
605,216
|
|||||||||||
Special mention
|
12,283
|
-
|
13,277
|
166
|
-
|
644
|
26,370
|
||||||||||||||||||
Substandard
|
12,242
|
5,954
|
8,155
|
7,997
|
-
|
356
|
34,704
|
||||||||||||||||||
Total
|
$
|
313,562
|
$
|
107,575
|
$
|
214,937
|
$
|
15,935
|
$
|
3,503
|
$
|
10,778
|
$
|
666,290
|
|||||||||||
(1) Net of undisbursed funds.
|
|||||||||||||||||||||||||
December 31, 2011
|
|||||||||||||||||||||||||
One-to-Four
Family
Residential
|
Multifamily
|
Commercial
Real Estate
|
Construction/
Land
Development
|
Business
|
Consumer
|
Total (1)
|
|||||||||||||||||||
(In thousands)
|
|||||||||||||||||||||||||
Risk Rating:
|
|||||||||||||||||||||||||
Pass
|
$
|
307,807
|
$
|
106,900
|
$
|
203,997
|
$
|
15,101
|
$
|
3,909
|
$
|
11,822
|
$
|
649,536
|
|||||||||||
Special mention
|
13,193
|
5,414
|
14,256
|
424
|
-
|
488
|
33,775
|
||||||||||||||||||
Substandard
|
14,376
|
949
|
13,584
|
9,199
|
-
|
189
|
38,297
|
||||||||||||||||||
Total
|
$
|
335,376
|
$
|
113,263
|
$
|
231,837
|
$
|
24,724
|
$
|
3,909
|
$
|
12,499
|
$
|
721,608
|
|||||||||||
(1) Net of undisbursed funds.
|
September 30, 2012
|
|||||||||||||||||||||||||
One-to-Four
Family
Residential
|
Multifamily
|
Commercial
Real Estate
|
Construction/
Land
Development
|
Business
|
Consumer
|
Total (3)
|
|||||||||||||||||||
(In thousands)
|
|||||||||||||||||||||||||
Performing (1)
|
$
|
305,115
|
$
|
102,864
|
$
|
212,650
|
$
|
7,938
|
$
|
3,503
|
$
|
10,637
|
$
|
642,707
|
|||||||||||
Nonperforming (2)
|
8,447
|
4,711
|
2,287
|
7,997
|
-
|
141
|
23,583
|
||||||||||||||||||
Total
|
$
|
313,562
|
$
|
107,575
|
$
|
214,937
|
$
|
15,935
|
$
|
3,503
|
$
|
10,778
|
$
|
666,290
|
|||||||||||
(1)
|
There were $163.4 million of owner-occupied one-to-four family residential loans and $141.7 million of non-owner occupied one-to-four family residential loans classified as performing.
|
||||||||||||||||||||||||
(2)
|
There were $5.7 million of owner-occupied one-to-four family residential loans and $2.8 million of non-owner occupied one-to-four family residential loans classified as nonperforming.
|
||||||||||||||||||||||||
(3)
|
Net of undisbursed funds.
|
||||||||||||||||||||||||
December 31, 2011
|
|||||||||||||||||||||||||
One-to-Four
Family
Residential
|
Multifamily
|
Commercial
Real Estate
|
Construction/
Land
Development
|
Business
|
Consumer
|
Total (3)
|
|||||||||||||||||||
(In thousands)
|
|||||||||||||||||||||||||
Performing (1)
|
$
|
325,568
|
$
|
112,314
|
$
|
228,101
|
$
|
15,525
|
$
|
3,909
|
$
|
12,499
|
$
|
697,916
|
|||||||||||
Nonperforming (2)
|
9,808
|
949
|
3,736
|
9,199
|
-
|
-
|
23,692
|
||||||||||||||||||
Total
|
$
|
335,376
|
$
|
113,263
|
$
|
231,837
|
$
|
24,724
|
$
|
3,909
|
$
|
12,499
|
$
|
721,608
|
|||||||||||
(1)
|
There were $183.0 million of owner-occupied one-to-four family residential loans and $142.6 million of non-owner occupied one-to-four family residential loans classified as performing.
|
||||||||||||||||||||||||
(2)
|
There were $5.0 million of owner-occupied one-to-four family residential loans and $4.8 million of non-owner occupied one-to-four family residential loans classified as nonperforming.
|
(3)
|
Net of undisbursed funds.
|
Three Months Ended September 30, 2012
|
Nine Months Ended September 30, 2012
|
|||||||||||||||||||||||
Number
of
Loans
|
Pre-
Modification Outstanding Recorded Investment
|
Post-
Modification Outstanding Recorded Investment
|
Number
of
Loans
|
Pre-
Modification Outstanding Recorded Investment
|
Post-
Modification Outstanding Recorded Investment
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
TDRs that Occurred During the Period:
|
||||||||||||||||||||||||
One-to-four family residential:
|
||||||||||||||||||||||||
Principal and interest with interest rate
concession
|
21 | $ | 3,750 | $ | 3,738 | 22 | $ | 3,964 | $ | 3,950 | ||||||||||||||
Principal and interest reamortized no
interest rate concession
|
1 | 71 | 71 | 1 | 71 | 71 | ||||||||||||||||||
Commercial real estate:
|
||||||||||||||||||||||||
Principal and interest with interest rate
concession
|
- | - | - | 1 | 1,415 | 1,400 | ||||||||||||||||||
Interest only payments with interest rate
concession
|
- | - | - | 2 | 2,508 | 2,504 | ||||||||||||||||||
Total
|
22 | $ | 3,821 | $ | 3,809 | 26 | $ | 7,958 | $ | 7,925 |
Three Months Ended September 30, 2011
|
Nine Months Ended September 30, 2011
|
|||||||||||||||||||||||
Number
of
Loans
|
Pre-
Modification Outstanding Recorded Investment
|
Post-
Modification Outstanding Recorded Investment
|
Number
of
Loans
|
Pre-
Modification Outstanding Recorded Investment
|
Post-
Modification Outstanding Recorded Investment
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
TDRs that Occurred During the Period:
|
||||||||||||||||||||||||
One-to-four family residential:
|
||||||||||||||||||||||||
A/B note restructure
|
- | $ | - | $ | - | 6 | $ | 1,130 | $ | 635 | ||||||||||||||
Interest only payments with interest rate
concession
|
1 | 1,019 | 1,017 | 12 | 4,459 | 4,451 | ||||||||||||||||||
Principal and interest with interest rate
concession
|
14 | 2,471 | 2,464 | 23 | 6,190 | 6,069 | ||||||||||||||||||
Interest only payments with no interest rate
concession
|
- | - | - | 2 | 527 | 510 | ||||||||||||||||||
Total
|
15 | $ | 3,490 | $ | 3,481 | 43 | $ | 12,306 | $ | 11,665 |
Types of Modifications
|
||||||||||||||||||||||||
Three Months Ended September 30, 2012
|
Nine Months Ended September 30, 2012
|
|||||||||||||||||||||||
Number
of
Loans
|
Interest Only Payments with
Interest Rate Concession
|
Interest
Rate
Concession
|
Number
of
Loans
|
Interest Only Payments with
Interest Rate Concession
|
Interest Rate Concession
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
TDRs that Subsequently Defaulted:
|
||||||||||||||||||||||||
One-to-four family residential
|
2 | $ | 377 | $ | - | 2 | $ | 377 | $ | - | ||||||||||||||
Commercial real estate
|
1 | 495 | - | 2 | 1,895 | - | ||||||||||||||||||
Total
|
3 | $ | 872 | $ | - | 4 | $ | 2,272 | $ | - |
Types of Modifications
|
||||||||||||||||||||
Three Months Ended September 30, 2011
|
Nine Months Ended September 30, 2011
|
|||||||||||||||||||
Number
of
Loans
|
Interest Only
Payments with
Interest Rate
Concession
|
Interest
Rate
Concession
|
|
Number of Loans
|
Interest Only
Payments with
Interest Rate
Concession
|
Interest
Rate
Concession
|
||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
TDRs that Subsequently Defaulted:
|
||||||||||||||||||||
One-to-four family residential
|
3
|
$
|
-
|
$
|
2,233
|
4
|
$
|
391
|
$
|
2,233
|
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
(In thousands)
|
||||||||||||||||
Beginning balance
|
$ | 22,206 | $ | 25,979 | $ | 26,044 | $ | 30,102 | ||||||||
Loans transferred to OREO
|
1,501 | 4,787 | 9,523 | 20,737 | ||||||||||||
Capitalized (reimbursed) improvements
|
(16 | ) | 91 | (16 | ) | 181 | ||||||||||
Dispositions of OREO
|
(3,325 | ) | (5,141 | ) | (14,640 | ) | (24,387 | ) | ||||||||
Market value adjustments
|
(1,157 | ) | (515 | ) | (1,702 | ) | (1,432 | ) | ||||||||
Ending balance
|
$ | 19,209 | $ | 25,201 | $ | 19,209 | $ | 25,201 |
·
|
Level 1 – Quoted prices for identical instruments in active markets.
|
·
|
Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable.
|
·
|
Level 3 – Instruments whose significant value drivers are unobservable.
|
Fair Value Measurements at September 30, 2012
|
||||||||||||||||
Quoted Prices in
|
Significant
|
|||||||||||||||
Active Markets
|
Other
|
Significant
|
||||||||||||||
Fair Value
|
for Identical
|
Observable
|
Unobservable
|
|||||||||||||
Measurements
|
Assets (Level 1)
|
Inputs (Level 2)
|
Inputs (Level 3)
|
|||||||||||||
(In thousands)
|
||||||||||||||||
Available-for-sale investments:
|
||||||||||||||||
Mortgage-backed investments:
|
||||||||||||||||
Fannie Mae
|
$ | 39,593 | $ | - | $ | 39,593 | $ | - | ||||||||
Freddie Mac
|
16,815 | - | 16,815 | - | ||||||||||||
Ginnie Mae
|
33,165 | - | 33,165 | - | ||||||||||||
Municipal bonds
|
1,827 | - | 1,827 | - | ||||||||||||
U.S. Government sponsored entities and agencies
|
67,559 | - | 67,559 | - | ||||||||||||
Total
|
$ | 158,959 | $ | - | $ | 158,959 | $ | - |
Fair Value Measurements at December 31, 2011
|
||||||||||||||||
Quoted Prices in
|
Significant
|
|||||||||||||||
Active Markets
|
Other
|
Significant
|
||||||||||||||
Fair Value
|
for Identical
|
Observable
|
Unobservable
|
|||||||||||||
Measurements
|
Assets (Level 1)
|
Inputs (Level 2)
|
Inputs (Level 3)
|
|||||||||||||
(In thousands)
|
||||||||||||||||
Available-for-sale investments:
|
||||||||||||||||
Mortgage-backed investments:
|
||||||||||||||||
Fannie Mae
|
$ | 52,163 | $ | - | $ | 52,163 | $ | - | ||||||||
Freddie Mac
|
19,845 | - | 19,845 | - | ||||||||||||
Ginnie Mae
|
7,495 | - | 7,495 | - | ||||||||||||
Municipal bonds
|
1,847 | - | 1,847 | - | ||||||||||||
U.S. Government sponsored entities and agencies
|
47,652 | - | 47,652 | - | ||||||||||||
Total
|
$ | 129,002 | $ | - | $ | 129,002 | $ | - |
Fair Value Measurements at September 30, 2012
|
||||||||||||||||||||
Quoted Prices in
|
Significant
|
|||||||||||||||||||
Active Markets
|
Other
|
Significant
|
||||||||||||||||||
Fair Value
|
for Identical
|
Observable
|
Unobservable
|
Total
|
||||||||||||||||
Measurements
|
Assets (Level 1)
|
Inputs (Level 2)
|
Inputs (Level 3)
|
Losses
|
||||||||||||||||
(In thousands)
|
||||||||||||||||||||
Impaired loans (included in loans
|
||||||||||||||||||||
receivable, net) (1) (2)
|
$ | 86,828 | $ | - | $ | - | $ | 86,828 | $ | 1,523 | ||||||||||
OREO (3)
|
19,209 | - | - | 19,209 | 1,157 | |||||||||||||||
Total
|
$ | 106,037 | $ | - | $ | - | $ | 106,037 | $ | 2,680 |
__________ | |||
(1) The loss represents the specific reserve against loans that were considered impaired at September 30, 2012.
|
|||
(2) There were no undisbursed funds at September 30, 2012.
|
|||
(3) The loss represents OREO market value adjustments for the quarter ended September 30, 2012.
|
Fair Value Measurements at December 31, 2011
|
||||||||||||||||||||
Quoted Prices in |
Significant
|
|||||||||||||||||||
Active Markets |
Other
|
Significant
|
||||||||||||||||||
Fair Value
|
for Identical
|
Observable
|
Unobservable
|
Total
|
||||||||||||||||
Measurements
|
Assets (Level 1)
|
Inputs (Level 2) |
Inputs (Level 3)
|
Losses
|
||||||||||||||||
(In thousands)
|
||||||||||||||||||||
Impaired loans including undisbursed
|
||||||||||||||||||||
but committed funds of $36 (included
|
||||||||||||||||||||
in loans receivable, net) (1)
|
$ | 89,389 | $ | - | $ | - | $ | 89,389 | $ | 564 | ||||||||||
OREO (2)
|
26,044 | - | - | 26,044 | 1,924 | |||||||||||||||
Total
|
$ | 115,433 | $ | - | $ | - | $ | 115,433 | $ | 2,488 |
____________ | |||
(1) The loss represents the specific reserve against loans that were considered impaired at December 31, 2011.
|
|||
(2) The loss represents OREO market value adjustments for the year ended December 31, 2011.
|
September 30, 2012 | |||||||||
Fair Value
|
Valuation
Technique(s)
|
Unobservable Input(s) | Range
(Weighted Average)
|
||||||
(Dollars in thousands) | |||||||||
Impaired loans
|
$
|
86,828
|
Market approach
|
Adjusted for differences between comparable sales
|
0% - 100% (1.4%)
|
||||
OREO
|
$
|
19,209
|
Market approach
|
Adjusted for differences between comparable sales
|
0% - 30% (13.0%)
|
September 30, 2012
|
||||||||||||||||||||
Carrying
|
Estimated
|
Fair Value Measurements Using:
|
||||||||||||||||||
Value
|
Fair Value
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||||||
(In thousands)
|
||||||||||||||||||||
Financial Assets:
|
||||||||||||||||||||
Cash on hand and in banks
|
$ | 5,265 | $ | 5,265 | $ | 5,265 | $ | - | $ | - | ||||||||||
Interest-bearing deposits
|
103,968 | 103,968 | 103,968 | - | - | |||||||||||||||
Investments available-for-sale
|
158,959 | 158,959 | - | 158,959 | - | |||||||||||||||
Loans receivable, net
|
650,348 | 681,776 | - | - | 681,776 | |||||||||||||||
Federal Home Loan Bank stock
|
7,347 | 7,347 | 7,347 | - | - | |||||||||||||||
Accrued interest receivable
|
3,730 | 3,730 | - | 3,730 | - | |||||||||||||||
Financial Liabilities:
|
||||||||||||||||||||
Deposits
|
195,233 | 195,233 | 195,233 | - | - | |||||||||||||||
Certificates of deposit
|
500,864 | 505,033 | - | - | 505,033 | |||||||||||||||
Advances from the FHLB
|
83,066 | 84,165 | - | 84,165 | - | |||||||||||||||
Accrued interest payable
|
187 | 187 | - | 187 | - |
December 31, 2011
|
||||||||
Carrying
|
Estimated
|
|||||||
Value
|
Fair Value
|
|||||||
(In thousands)
|
||||||||
Financial Assets:
|
||||||||
Cash on hand and in banks
|
$ | 4,620 | $ | 4,620 | ||||
Interest-bearing deposits
|
160,141 | 160,141 | ||||||
Investments available-for-sale
|
129,002 | 129,002 | ||||||
Loans receivable, net
|
703,288 | 738,266 | ||||||
Federal Home Loan Bank stock
|
7,413 | 7,413 | ||||||
Accrued interest receivable
|
3,856 | 3,856 | ||||||
Financial Liabilities:
|
||||||||
Deposits
|
218,621 | 218,621 | ||||||
Certificates of deposit
|
570,044 | 577,570 | ||||||
Advances from the FHLB
|
83,066 | 84,926 | ||||||
Accrued interest payable
|
184 | 184 |
·
|
Financial instruments with book value equal to fair value: The fair value of financial instruments that are short-term or reprice frequently and that have little or no risk are considered to have a fair value equal to book value. These instruments include cash on hand and in banks, interest-bearing deposits, Federal Home Loan Bank of Seattle (“FHLB”) stock, accrued interest receivable and accrued interest payable. FHLB stock is not publicly-traded, however, it may be redeemed on a dollar-for-dollar basis, for any amount the Bank is not required to hold, subject to the FHLB’s discretion. The fair value is therefore equal to the book value.
|
·
|
Investments available-for-sale: The fair value of all investments, excluding FHLB stock, was based upon quoted market prices for similar investments in active markets, identical or similar investments in markets that are not active and model-derived valuations whose inputs are observable.
|
·
|
Loans receivable: For variable rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values. The fair value of fixed-rate loans is estimated using discounted cash flow analysis, utilizing interest rates that would be offered for loans with similar terms to borrowers of similar credit quality. As a result of current market conditions, cash flow estimates have been further discounted to include a credit factor. The fair value of nonperforming loans is estimated using the fair value of the underlying collateral.
|
·
|
Liabilities: The fair value of deposits with no stated maturity, such as statement, NOW, and money market accounts, is equal to the amount payable on demand. The fair value of certificates of deposit is based on the discounted value of contractual cash flows using current interest rates for certificates of deposit with similar remaining maturities. The fair value of FHLB advances is estimated based on discounting the future cash flows using current interest rates for debt with similar remaining maturities.
|
·
|
Off balance sheet commitments: No fair value adjustment is necessary for commitments made to extend credit, which represents commitments for loan originations or for outstanding commitments to purchase loans. These commitments are at variable rates, are for loans with terms of less than one year and have interest rates which approximate prevailing market rates, or are set at the time of loan closing.
|
Annual dividend yield | 0.00% | |
Expected volatility | 30.00% | |
Risk-free interest rate | 1.06% | |
Expected term | 6.5 years | |
Weighted-average grant date fair value per option granted | $2.58 |
Weighted-Average
|
Aggregate
|
Weighted-Average
|
||||||||
Weighted-Average
|
Remaining Contractual
|
Intrinsic
|
Grant-Date
|
|||||||
Shares
|
Exercise Price
|
Term in Years
|
Value
|
Fair Value
|
||||||
Outstanding at January 1, 2012
|
1,373,524
|
$
|
9.52
|
6.60
|
$
|
94
|
$
|
1.91
|
||
Granted
|
50,000
|
8.01
|
9.97
|
2
|
2.58
|
|||||
Exercised
|
-
|
-
|
-
|
-
|
||||||
Forfeited or expired
|
(25,000)
|
9.78
|
-
|
1.92
|
||||||
Outstanding at September 30, 2012
|
1,398,524
|
9.46
|
6.00
|
203
|
1.93
|
|||||
Expected to vest assuming a 3% forfeiture
|
||||||||||
rate over the vesting term
|
339,211
|
8.95
|
6.56
|
119
|
||||||
Exercisable at September 30, 2012
|
1,048,819
|
9.63
|
5.81
|
80
|
Weighted-Average
|
||||||||
Grant-Date
|
||||||||
Nonvested Shares
|
Shares
|
Fair Value
|
||||||
Nonvested at January 1, 2012
|
310,494 | $ | 9.66 | |||||
Granted
|
50,000 | 8.01 | ||||||
Vested
|
(143,647 | ) | 9.93 | |||||
Forfeited
|
(4,000 | ) | 10.35 | |||||
Nonvested at September 30, 2012
|
212,847 | 9.08 | ||||||
Expected to vest assuming a 3% forfeiture
|
||||||||
rate over the vesting term
|
206,461 |
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
(Dollars in thousands, except share data)
|
||||||||||||||||
Net income
|
$ | (791 | ) | $ | 623 | $ | 1,202 | $ | 3,315 | |||||||
Basic weighted-average common shares outstanding
|
17,658,005 | 17,545,157 | 17,629,863 | 17,519,016 | ||||||||||||
Plus common stock options considered outstanding for
|
||||||||||||||||
dilutive purposes (excludes antidilutive options)
|
- | - | 18,137 | - | ||||||||||||
Diluted weighted-average common shares outstanding
|
17,658,005 | 17,545,157 | 17,648,000 | 17,519,016 | ||||||||||||
Basic earnings (loss) per share
|
$ | (0.04 | ) | $ | 0.04 | $ | 0.07 | $ | 0.19 | |||||||
Diluted earnings (loss) per share
|
$ | (0.04 | ) | $ | 0.04 | $ | 0.07 | $ | 0.19 |
Construction/
|
Aggregate
|
||||||||||||||||||||
One-to-Four Family
|
Commercial
|
Land
|
Balance
|
||||||||||||||||||
Borrower (1)
|
Residential
|
Multifamily
|
Real Estate
|
Development
|
of Loans (2)
|
||||||||||||||||
(In thousands)
|
|||||||||||||||||||||
Real estate builder
|
$ | 20,765 | $ | - | $ | 99 | $ | 4,915 | $ | 25,779 | |||||||||||
Real estate investor
|
- | - | 18,096 | - | 18,096 | ||||||||||||||||
Real estate builder (3)
|
14,591 | - | 227 | 3,210 | 18,028 | ||||||||||||||||
Real estate investor
|
10,196 | 3,688 | 934 | - | 14,818 | ||||||||||||||||
Real estate builder (4)
|
13,318 | - | 812 | - | 14,130 | ||||||||||||||||
Total
|
$ | 58,870 | $ | 3,688 | $ | 20,168 | $ | 8,125 | $ | 90,851 |
(1) The composition of borrowers represented in the table may change between periods.
|
||||||||||||||||||||
(2) Net of undisbursed funds.
|
||||||||||||||||||||
(3) Of this amount, $16.4 million were considered impaired loans consisting of $13.2 million in performing one-to-
|
||||||||||||||||||||
four family residential loans and $3.2 million in nonperforming construction/land development loans.
|
||||||||||||||||||||
(4) Of this amount, $13.3 million were considered impaired loans consisting of $12.1 million in performing one-to-
|
||||||||||||||||||||
four family residential loans, $428,000 in nonperforming one-to-four family residential loans and $812,000 in
|
||||||||||||||||||||
performing commercial real estate loans.
|
Increase/
|
Percentage
|
|||||||||||
Balance at
|
(Decrease) from
|
Increase/
|
||||||||||
September 30, 2012
|
December 31, 2011
|
(Decrease)
|
||||||||||
(Dollars in thousands)
|
||||||||||||
Cash on hand and in banks
|
$ | 5,265 | $ | 645 | 14.0 | % | ||||||
Interest-bearing deposits
|
103,968 | (56,173 | ) | (35.1 | ) | |||||||
Investments available-for-sale, at fair value
|
158,959 | 29,957 | 23.2 | |||||||||
Loans receivable, net
|
650,348 | (52,940 | ) | (7.5 | ) | |||||||
Premises and equipment, net
|
18,259 | (663 | ) | (3.5 | ) | |||||||
FHLB stock, at cost
|
7,347 | (66 | ) | (0.9 | ) | |||||||
Accrued interest receivable
|
3,730 | (126 | ) | (3.3 | ) | |||||||
Federal income tax receivable
|
60 | (1,000 | ) | (94.3 | ) | |||||||
Deferred tax assets
|
1,000 | 1,000 | 100.0 | |||||||||
OREO
|
19,209 | (6,835 | ) | (26.2 | ) | |||||||
Prepaid expenses and other assets
|
4,908 | (136 | ) | (2.7 | ) | |||||||
Total assets
|
$ | 973,053 | $ | (86,337 | ) | (8.1 | ) |
Increase/
|
Percentage
|
|||||||||||
Balance at
|
(Decrease) from
|
Increase/
|
||||||||||
September 30, 2012
|
December 31, 2011
|
(Decrease)
|
||||||||||
(Dollars in thousands)
|
||||||||||||
Noninterest-bearing
|
$ | 6,147 | $ | 134 | 2.2 | % | ||||||
NOW
|
14,149 | (44 | ) | (0.3 | ) | |||||||
Statement savings
|
17,894 | 110 | 0.6 | |||||||||
Money market
|
157,043 | (23,588 | ) | (13.1 | ) | |||||||
Certificates of deposit
|
500,864 | (69,180 | ) | (12.1 | ) | |||||||
Total deposits
|
$ | 696,097 | $ | (92,568 | ) | (11.7 | ) |
Three Months Ended September 30, 2012
|
Nine Months Ended September 30, 2012
|
|||||||||||||||||||||||
Compared to September 30, 2011
|
Compared to September 30, 2011
|
|||||||||||||||||||||||
Increase/(Decrease) Due to
|
Increase/(Decrease) Due to
|
|||||||||||||||||||||||
Rate
|
Volume
|
Total
|
Rate
|
Volume
|
Total
|
|||||||||||||||||||
(In thousands)
|
||||||||||||||||||||||||
Interest-earning assets:
|
||||||||||||||||||||||||
Loans receivable, net
|
$ | (455 | ) | $ | (1,403 | ) | $ | (1,858 | ) | $ | (599 | ) | $ | (5,304 | ) | $ | (5,903 | ) | ||||||
Investments available-for-sale
|
(497 | ) | 78 | (419 | ) | (1,566 | ) | (227 | ) | (1,793 | ) | |||||||||||||
Interest-bearing deposits
|
38 | (54 | ) | (16 | ) | 20 | (12 | ) | 8 | |||||||||||||||
Total net change in income on
|
||||||||||||||||||||||||
interest-earning assets
|
(914 | ) | (1,379 | ) | (2,293 | ) | (2,145 | ) | (5,543 | ) | (7,688 | ) | ||||||||||||
Interest-bearing liabilities:
|
||||||||||||||||||||||||
NOW
|
- | 1 | 1 | (3 | ) | 2 | (1 | ) | ||||||||||||||||
Statement savings
|
(3 | ) | 1 | (2 | ) | (23 | ) | 4 | (19 | ) | ||||||||||||||
Money market
|
(59 | ) | (19 | ) | (78 | ) | (355 | ) | (69 | ) | (424 | ) | ||||||||||||
Certificates of deposit
|
(668 | ) | (805 | ) | (1,473 | ) | (1,895 | ) | (2,378 | ) | (4,273 | ) | ||||||||||||
Advances from the FHLB
|
(8 | ) | (64 | ) | (72 | ) | (19 | ) | (190 | ) | (209 | ) | ||||||||||||
Total net change in expenses
|
||||||||||||||||||||||||
on interest-bearing liabilities
|
(738 | ) | (886 | ) | (1,624 | ) | (2,295 | ) | (2,631 | ) | (4,926 | ) | ||||||||||||
Change in net interest income
|
$ | (176 | ) | $ | (493 | ) | $ | (669 | ) | $ | 150 | $ | (2,912 | ) | $ | (2,762 | ) |
Three Months Ended September 30,
|
Increase/ | |||||||||||||
2012
|
2011
|
(Decrease)
|
||||||||||||
Average
|
Average
|
in Interest and
|
||||||||||||
Balance
|
Yield
|
Balance
|
Yield
|
Dividend Income
|
||||||||||
(Dollars in thousands)
|
||||||||||||||
Loans receivable, net
|
$
|
651,744
|
5.85
|
%
|
$
|
743,439
|
6.13
|
%
|
$
|
(1,858)
|
||||
Investments available-for-sale
|
144,147
|
1.41
|
133,001
|
2.78
|
(419)
|
|||||||||
Interest-bearing deposits
|
132,509
|
0.34
|
200,039
|
0.25
|
(16)
|
|||||||||
FHLB stock
|
7,409
|
-
|
7,413
|
-
|
-
|
|||||||||
Total interest-earning assets
|
$
|
935,809
|
4.34
|
%
|
$
|
1,083,892
|
4.59
|
%
|
$
|
(2,293)
|
Nine Months Ended September 30,
|
||||||||||||||||||
2012
|
2011
|
Increase/
(Decrease)
|
||||||||||||||||
Average
|
Average
|
in Interest and
|
||||||||||||||||
Balance
|
Yield
|
Balance
|
Yield
|
Dividend Income
|
||||||||||||||
(Dollars in thousands) | ||||||||||||||||||
Loans receivable, net
|
$ | 667,955 | 5.95 | % | $ | 784,956 | 6.07 | % | $ | (5,903 | ) | |||||||
Investments available-for-sale
|
139,613 | 1.53 | 149,596 | 3.02 | (1,793 | ) | ||||||||||||
Interest-bearing deposits
|
147,455 | 0.28 | 158,077 | 0.25 | 8 | |||||||||||||
FHLB stock
|
7,412 | - | 7,413 | - | - | |||||||||||||
Total interest-earning assets
|
$ | 962,435 | 4.39 | % | $ | 1,100,042 | 4.78 | % | $ | (7,688 | ) |
Three Months Ended September 30,
|
|||||||||||||||||
2012
|
2011
|
Increase/
|
|||||||||||||||
Average
|
Average
|
(Decrease) in
|
|||||||||||||||
Balance
|
Cost
|
Balance
|
Cost
|
Interest Expense
|
|||||||||||||
(Dollars in thousands) | |||||||||||||||||
NOW
|
$ | 14,429 | 0.17 | $ | 12,690 | 0.16 |
|
$ | 1 | ||||||||
Statement savings
|
18,018 | 0.20 | 16,827 | 0.26 | (2 | ) | |||||||||||
Money market
|
157,952 | 0.28 | 175,814 | 0.43 | (78 | ) | |||||||||||
Certificates of deposit
|
513,222 | 1.79 | 652,549 | 2.31 | (1,473 | ) | |||||||||||
Advances from the FHLB
|
83,067 | 2.49 | 93,066 | 2.53 | (72 | ) | |||||||||||
Total interest-bearing liabilities
|
$ | 786,688 | 1.50 | $ | 950,946 | 1.92 | $ | (1,624 | ) |
Nine Months Ended September 30,
|
||||||||||||||
2012
|
2011 |
Increase/
|
||||||||||||
Average
|
Average
|
(Decrease) in
|
||||||||||||
Balance
|
Cost
|
Balance
|
Cost
|
Interest Expense
|
||||||||||
(Dollars in thousands)
|
||||||||||||||
NOW
|
$
|
14,344
|
0.15
|
%
|
$
|
12,818
|
0.18
|
%
|
$
|
(1)
|
||||
Statement savings
|
17,935
|
0.20
|
16,343
|
0.38
|
(19)
|
|||||||||
Money market
|
166,984
|
0.29
|
182,800
|
0.57
|
(424)
|
|||||||||
Certificates of deposit
|
536,111
|
1.89
|
670,116
|
2.36
|
(4,273)
|
|||||||||
Advances from the FHLB
|
83,067
|
2.47
|
93,066
|
2.50
|
(209)
|
|||||||||
Total interest-bearing liabilities
|
$
|
818,441
|
1.55
|
$
|
975,143
|
1.98
|
$
|
(4,926)
|
·
|
Nonperforming loans as a percentage of total loans decreased to 3.54% at September 30, 2012, from 4.13% at September 30, 2011;
|
·
|
Nonperforming loans decreased $7.2 million to $23.6 million at September 30, 2012, from $30.8 million at September 30, 2011;
|
·
|
The loan portfolio declined $76.9 million, or 10.6% from $727.2 million at September 30, 2011. In particular, our risk profile improved as construction/land development loans declined $13.0 million from September 30, 2011 to $16.9 million at September 30, 2012;
|
·
|
Management continues to be proactive in managing problem loans and assessing the risk inherent in the loan portfolio and when it is determined that a loan is impaired, the amount of the loss is quantified and charged-off. Net charge-offs declined to $1.0 million for the three months ended September 30, 2012, from $1.7 million for this same period in 2011.
|
Nine Month |
One Year
|
|||||||||||||||||||
September 30,
|
December 31,
|
September 30,
|
Increase/ | Increase/ | ||||||||||||||||
2012
|
2011
|
2011
|
(Decrease)
|
(Decrease)
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
One-to-four family residential
|
$ | 8,447 | $ | 9,808 | $ | 12,859 | $ | (1,361 | ) | $ | (4,412 | ) | ||||||||
Multifamily
|
4,711 | 949 | 638 | 3,762 | 4,073 | |||||||||||||||
Commercial real estate
|
2,287 | 3,736 | 5,400 | (1,449 | ) | (3,113 | ) | |||||||||||||
Construction/land development
|
7,997 | 9,199 | 11,891 | (1,202 | ) | (3,894 | ) | |||||||||||||
Consumer
|
141 | - | 44 | 141 | 97 | |||||||||||||||
Total nonperforming loans
|
23,583 | 23,692 | 30,832 | (109 | ) | (7,249 | ) | |||||||||||||
OREO
|
19,209 | 26,044 | 25,201 | (6,835 | ) | (5,992 | ) | |||||||||||||
Total nonperforming assets
|
$ | 42,792 | $ | 49,736 | $ | 56,033 | $ | (6,944 | ) | $ | (13,241 | ) | ||||||||
Nonperforming assets as a
|
||||||||||||||||||||
percent of total assets
|
4.4 | % | 4.7 | % | 4.9 | % |
Nine Month
|
One Year
|
|||||||||||||||||||
September 30,
|
December 31,
|
September 30,
|
Increase/
|
Increase/
|
||||||||||||||||
2012
|
2011
|
2011
|
(Decrease)
|
(Decrease)
|
||||||||||||||||
(In thousands)
|
||||||||||||||||||||
Nonperforming TDRs:
|
||||||||||||||||||||
One-to-four family residential
|
$ | 3,907 | $ | 3,994 | $ | 5,185 | $ | (87 | ) | $ | (1,278 | ) | ||||||||
Multifamily
|
1,058 | - | - | 1,058 | 1,058 | |||||||||||||||
Commercial real estate
|
- | 902 | 1,531 | (902 | ) | (1,531 | ) | |||||||||||||
Construction/land development
|
- | 183 | 472 | (183 | ) | (472 | ) | |||||||||||||
Consumer
|
48 | - | - | 48 | 48 | |||||||||||||||
Total nonperforming TDRs
|
5,013 | 5,079 | 7,188 | (66 | ) | (2,175 | ) | |||||||||||||
Performing TDRs:
|
||||||||||||||||||||
One-to-four family residential
|
52,467 | 52,768 | 53,029 | (301 | ) | (562 | ) | |||||||||||||
Multifamily
|
1,243 | 2,504 | 2,512 | (1,261 | ) | (1,269 | ) | |||||||||||||
Commercial real estate
|
11,058 | 10,883 | 10,409 | 175 | 649 | |||||||||||||||
Consumer
|
- | 70 | 70 | (70 | ) | (70 | ) | |||||||||||||
Total performing TDRs
|
64,768 | 66,225 | 66,020 | (1,457 | ) | (1,252 | ) | |||||||||||||
Total TDRs
|
$ | 69,781 | $ | 71,304 | $ | 73,208 | $ | (1,523 | ) | $ | (3,427 | ) |
County
|
Total
|
Number of
|
Percent of
|
||||||||||||||||||||||
King
|
Pierce
|
Kitsap
|
All Other
|
OREO
|
Properties
|
Total OREO
|
|||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||
OREO:
|
|||||||||||||||||||||||||
One-to-four family residential
|
$
|
3,101
|
$
|
1,422
|
$
|
-
|
$
|
539
|
$
|
5,062
|
23
|
26.3
|
%
|
||||||||||||
Multifamily
|
560
|
-
|
-
|
-
|
560
|
1
|
2.9
|
||||||||||||||||||
Commercial real estate (1)
|
2,220
|
6,925
|
1,201
|
287
|
10,633
|
30
|
55.4
|
||||||||||||||||||
Construction/land development
|
-
|
1,962
|
601
|
391
|
2,954
|
8
|
15.4
|
||||||||||||||||||
Total OREO
|
$
|
5,881
|
$
|
10,309
|
$
|
1,802
|
$
|
1,217
|
$
|
19,209
|
62
|
100.0
|
%
|
||||||||||||
(1) Of the 30 properties classified as commercial real estate, nine are office/retail buildings, one is a mixed use building, 15 are
|
|||||||||||||||||||||||||
developed lots and five are undeveloped lots.
|
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
(In thousands)
|
||||||||||||||||
Beginning balance
|
$
|
22,206
|
$
|
25,979
|
$
|
26,044
|
$
|
30,102
|
||||||||
Loans transferred to OREO
|
1,501
|
4,787
|
9,523
|
20,737
|
||||||||||||
Capitalized (reimbursed) improvements
|
(16)
|
91
|
(16)
|
181
|
||||||||||||
Dispositions of OREO
|
(3,325)
|
(5,141)
|
(14,640)
|
(24,387)
|
||||||||||||
Market value adjustments
|
(1,157)
|
(515)
|
(1,702)
|
(1,432)
|
||||||||||||
Ending balance
|
$
|
19,209
|
$
|
25,201
|
$
|
19,209
|
$
|
25,201
|
At or For the Nine Months
|
|||||||
Ended September 30,
|
|||||||
2012
|
2011
|
||||||
(Dollars in thousands)
|
|||||||
Provision for loan losses
|
$
|
3,050
|
$
|
4,100
|
|||
Charge-offs
|
7,389
|
10,337
|
|||||
Recoveries
|
1,948
|
337
|
|||||
ALLL
|
14,168
|
16,634
|
|||||
ALLL as a percent of total loans
|
2.13
|
%
|
2.23
|
%
|
|||
ALLL as a percent of nonperforming loans
|
60.08
|
%
|
53.95
|
%
|
|||
Total nonperforming loans
|
$
|
23,583
|
$
|
30,832
|
|||
Nonperforming loans as a percent of total loans
|
3.54
|
%
|
4.13
|
%
|
|||
Total loans receivable
|
$
|
666,290
|
$
|
745,708
|
|||
Total loans originated
|
64,607
|
22,203
|
Three Months
|
Increase/(Decrease)
|
Percentage
|
|||||||||||
Ended
|
from
|
Increase/
|
|||||||||||
September 30, 2012
|
September 30, 2011
|
(Decrease)
|
|||||||||||
(Dollars in thousands)
|
|||||||||||||
Service fees on deposit accounts
|
$ | 18 | $ | 1 | 5.9 |
%
|
|||||||
Loan service fees
|
36 | (23 | ) | (39.0 | ) | ||||||||
Gain on sale of investments
|
- | (479 | ) | (100.0 | ) | ||||||||
Servicing rights, net
|
(12 | ) | 12 | (50.0 | ) | ||||||||
Other
|
65 | 40 | 160.0 | ||||||||||
Total noninterest income
|
$ | 107 | $ | (449 | ) | (80.8 | ) |
Nine Months
|
Increase/(Decrease)
|
Percentage
|
|||||||||||
Ended
|
from
|
Increase/
|
|||||||||||
September 30, 2012
|
September 30, 2011
|
(Decrease)
|
|||||||||||
(Dollars in thousands)
|
|||||||||||||
Service fees on deposit accounts
|
$ | 65 | $ | - | 0.0 |
%
|
|||||||
Loan service fees
|
230 | 77 | 50.3 | ||||||||||
Gain on sale of investments
|
288 | (1,453 | ) | (83.5 | ) | ||||||||
Servicing rights, net
|
(34 | ) | 26 | (43.3 | ) | ||||||||
Other
|
169 | 90 | 113.9 | ||||||||||
Total noninterest income
|
$ | 718 | $ | (1,260 | ) | (63.7 | ) |
Three Months
|
Increase/(Decrease)
|
Percentage
|
|||||||||||
Ended
|
from
|
Increase/
|
|||||||||||
September 30, 2012
|
September 30, 2011
|
(Decrease)
|
|||||||||||
(Dollars in thousands)
|
|||||||||||||
Compensation and benefits
|
$ | 3,680 | $ | 136 | 3.8 |
%
|
|||||||
Occupancy and equipment
|
391 | 21 | 5.7 | ||||||||||
Professional fees
|
460 | 11 | 2.4 | ||||||||||
Data processing
|
174 | (7 | ) | (3.9 | ) | ||||||||
Loss (gain) on sale of OREO property, net
|
(78 | ) | 215 | (73.4 | ) | ||||||||
OREO market value adjustments
|
1,157 | 642 | 124.7 | ||||||||||
OREO related expenses, net
|
486 | (54 | ) | (10.0 | ) | ||||||||
Regulatory assessments
|
298 | (280 | ) | (48.4 | ) | ||||||||
Insurance/bond premiums
|
100 | (148 | ) | (59.7 | ) | ||||||||
Proxy contest and related litigation
|
264 | 264 | 100.0 | ||||||||||
Marketing
|
68 | 25 | 58.1 | ||||||||||
Other
|
457 | 119 | 35.2 | ||||||||||
Total noninterest expense
|
$ | 7,457 | $ | 944 | 14.5 |
Nine Months
|
Increase/(Decrease)
|
Percentage
|
|||||||||||
Ended
|
from
|
Increase/
|
|||||||||||
September 30, 2012
|
September 30, 2011
|
(Decrease)
|
|||||||||||
(Dollars in thousands)
|
|||||||||||||
Compensation and benefits
|
$ | 10,558 | $ | 511 | 5.1 |
%
|
|||||||
Occupancy and equipment
|
1,191 | 24 | 2.1 | ||||||||||
Professional fees
|
1,401 | (30 | ) | (2.1 | ) | ||||||||
Data processing
|
540 | (33 | ) | (5.8 | ) | ||||||||
Loss (gain) on sale of OREO property, net
|
(427 | ) | 1,000 | (70.1 | ) | ||||||||
OREO market value adjustments
|
1,702 | 270 | 18.9 | ||||||||||
OREO related expenses, net
|
1,421 | (955 | ) | (40.2 | ) | ||||||||
Regulatory assessments
|
709 | (1,191 | ) | (62.7 | ) | ||||||||
Insurance/bond premiums
|
300 | (443 | ) | (59.6 | ) | ||||||||
Proxy contest and related litigation
|
868 | 868 | 100.0 | ||||||||||
Marketing
|
181 | 27 | 17.5 | ||||||||||
Other
|
1,203 | 92 | 8.3 | ||||||||||
Total noninterest expense
|
$ | 19,647 | $ | 140 | 0.7 |
Amount of Commitment Expiration - Per Period
|
||||||||||||||||||||
After One
|
After Three
|
|||||||||||||||||||
Total Amounts
|
Through
|
Through
|
Through
|
After
|
||||||||||||||||
Committed
|
One Year
|
Three Years |
Five Years
|
Five Years
|
||||||||||||||||
(In thousands)
|
||||||||||||||||||||
Commitments to originate loans
|
$ | 17,136 | $ | 17,136 | $ | - | $ | - | $ | - | ||||||||||
Unused portion of lines of credit
|
8,331 | 262 | 2,908 | 1,010 | 4,151 | |||||||||||||||
Undisbursed portion of construction loans
|
931 | 931 | - | - | - | |||||||||||||||
Total commitments
|
$ | 26,398 | $ | 18,329 | $ | 2,908 | $ | 1,010 | $ | 4,151 |
Net Interest Income Change at
|
||||
September 30, 2012
|
||||
Basis Point
Change in Rates
|
% Change
|
|||
+300
|
7.02 %
|
|
||
+200
|
5.39
|
|||
+100
|
3.67
|
|||
Base
|
1.22
|
|||
(100)
|
1.09
|
|||
(1)
|
(200)
|
N/A
|
||
(1)
|
(300)
|
N/A
|
||
(1) | The current federal funds rate is 0.25%, | |||
making a 200 or 300 basis point decrease
|
||||
in rates impossible.
|
Basis Point
|
Net Portfolio as % of
|
Market
|
||||||||||||||||
Change in
|
Net Portfolio Value (2)
|
Portfolio Value of Assets
|
Value of
|
|||||||||||||||
Rates (1)
|
Amount
|
$ Change (3)
|
% Change
|
NPV Ratio (4)
|
% Change (5)
|
Assets (6)
|
||||||||||||
(Dollars in thousands)
|
||||||||||||||||||
+300
|
$
|
172,370
|
$
|
(48,491)
|
(21.96)%
|
|
18.36%
|
|
(4.78)%
|
|
$
|
938,832
|
||||||
+200
|
191,563
|
(29,298)
|
(13.27)
|
19.83
|
(2.89)
|
966,049
|
||||||||||||
+100
|
208,081
|
(12,780)
|
(5.79)
|
20.99
|
(1.26)
|
991,255
|
||||||||||||
Base
|
220,861
|
-
|
-
|
21.79
|
-
|
1,013,801
|
||||||||||||
(100)
|
244,779
|
23,918
|
10.83
|
23.45
|
2.36
|
1,043,845
|
||||||||||||
(200)
|
(1)
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
|||||||||||
(300)
|
(1)
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
N/A
|
(1) The current federal funds rate is 0.25%, making a 200 and 300 basis point decrease impossible.
|
||||||||||||||||||||
(2) The net portfolio value is the difference between the present value of the discounted cash flows of assets and
|
||||||||||||||||||||
liabilities and represents the market value of the Company's equity for any given interest rate scenario. Net
|
||||||||||||||||||||
portfolio value is useful for determining, on a market value basis, how equity changes in response to various
|
||||||||||||||||||||
interest rate scenarios. Large changes in net portfolio value reflect increased interest rate sensitivity and generally
|
||||||||||||||||||||
more volatile earnings streams.
|
||||||||||||||||||||
(3) The increase or decrease in the estimated net portfolio value at the indicated interest rates compared to the net
|
||||||||||||||||||||
portfolio value, assuming no change in interest rates.
|
||||||||||||||||||||
(4) Net portfolio value divided by the market value of assets.
|
||||||||||||||||||||
(5) The increase or decrease in the net portfolio value divided by the market value of assets.
|
||||||||||||||||||||
(6) The market value of assets represents the value of assets under the various interest rate scenarios and reflects the
|
||||||||||||||||||||
sensitivity of those assets to interest rate changes.
|
(a)
|
Evaluation of Disclosure Controls and Procedures: An evaluation of our disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act) was carried out under the supervision and with the participation of our Chief Executive Officer, Chief Financial Officer (Principal Financial and Accounting Officer) and several other members of our senior management as of the end of the period covered by this report. Our Chief Executive Officer and Chief Financial Officer concluded that, as of September 30, 2012, our disclosure controls and procedures were effective in ensuring that the information required to be disclosed by us in the reports we file or submit under the Exchange Act is (i) accumulated and communicated to our management (including the Chief Executive Officer and Chief Financial Officer) in a timely manner and (ii) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
|
(b)
|
Changes in Internal Controls: In the quarter ended September 30, 2012, there was no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
|
3.1 | Articles of Incorporation of First Financial Northwest (1) |
3.2 | Amended and Restated Bylaws of First Financial Northwest (2) |
4 | Form of stock certificate of First Financial Northwest (1) |
10.1 | Form of Employment Agreement for President and Chief Executive Officer (1) |
10.2 | Form of Change in Control Severance Agreement for Executive Officers (1) |
10.3 | Form of First Savings Bank Employee Severance Compensation Plan (1) |
10.4
|
Form of Supplemental Executive Retirement Agreement entered into by First Savings Bank with Victor Karpiak, Harry A. Blencoe and Robert H. Gagnier (1)
|
10.5 | Form of Financial Institutions Retirement Fund (1) |
10.6 | Form of 401(k) Retirement Plan (3) |
10.7
|
2008 Equity Incentive Plan (4) |
10.8 | Forms of incentive and non-qualified stock option award agreements (5) |
10.9 | Form of restricted stock award agreement (5) |
14 | Code of Business Conduct and Ethics (6) |
|
Subsidiaries of the Registrant |
31.1 | Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act |
31.2 | Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act |
32
|
Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act
|
101
|
The following materials from First Financial Northwest’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2012, formatted in Extensible Business Reporting Language (XBRL): (1) Consolidated Balance Sheets; (2) Consolidated Statements of Operations; (3) Consolidated
|
Statements of Comprehensive Income; (4) Consolidated Statements of Changes in Stockholders’ Equity; (5) Consolidated Statements of Cash Flows; and (6) Selected Notes to Consolidated Financial Statements.*
|
(1) |
Filed as an exhibit to First Financial Northwest’s Registration Statement on Form S-1 (333-143549).
|
(2) |
Filed as an exhibit to First Financial Northwest’s Current Report on Form 8-K dated March 22, 2012.
|
(3) |
Filed as an exhibit to First Financial Northwest’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2007 and incorporated herein by reference.
|
(4) |
Filed as Appendix A to First Financial Northwest’s definitive proxy statement dated April 15, 2008.
|
(5) |
Filed as an exhibit to First Financial Northwest’s Current Report on Form 8-K dated July 1, 2008.
|
(6) |
Registrant elects to satisfy Regulation S-K §229.406 (c) by posting its code of ethics on its website at www.fsbnw.com.
|
First Financial Northwest, Inc. | |
Date: November 8, 2012 | /s/Victor Karpiak |
Victor Karpiak | |
Chairman of the Board, President and | |
Chief Executive Officer
|
|
(Principal Executive Officer) | |
Date: November 8, 2012 | /s/Kari Stenslie |
Kari Stenslie | |
Chief Financial Officer | |
(Principal Financial and Accounting Officer) |
31.1
|
Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act
|
31.2
|
Certification of Chief Financial Officer and Principal Financial and Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act
|
32
|
Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act
|
101
|
The following materials from First Financial Northwest’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2012, formatted in Extensible Business Reporting Language XBRL): (1) Consolidated Balance Sheets; (2) Consolidated Statements of Operations; (3) Consolidated Statements of Comprehensive Income; (4) Consolidated Statements of Changes in Stockholders’ Equity; (5) Consolidated Statements of Cash Flows; and (6) Selected Notes to Consolidated Financial Statements.*
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of First Financial Northwest, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weakness in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial data information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: November 8, 2012 | /s/Victor Karpiak |
Victor Karpiak
|
|
Chairman of the Board, President and
|
|
Chief Executive Officer
|
|
(Principal Executive Officer) |
1.
|
I have reviewed this Quarterly Report on Form 10-Q of First Financial Northwest, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weakness in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial data information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: November 8, 2012 | /s/Kari Stenslie |
Kari Stenslie | |
Chief Financial Officer | |
(Principal Financial and Accounting Officer) | |
1.
|
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
2.
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods presented in the financial statements included in the Report.
|
/s/Victor Karpiak |
Victor Karpiak |
Chairman of the Board, President and Chief Executive Officer
|
(Principal Executive Officer) |
Dated: November 8, 2012 |
/s/Kari Stenslie |
Kari Stenslie |
Chief Financial Officer |
(Principal Financial and Accounting Officer) |
Dated: November 8, 2012 |
Other Real Estate Owned: Other Real Estate, Roll Forward (Tables)
|
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Tables/Schedules | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Real Estate, Roll Forward |
|
Loans Receivable: Non-performing Loans, Foregone interest, and loans committed (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2011
|
Sep. 30, 2012
|
Sep. 30, 2011
|
Dec. 31, 2011
|
|
Loans Receivable, non-performing | $ 23,600 | $ 23,600 | $ 23,700 | ||
Loans and Leases Receivable, Impaired, Interest Lost on Nonaccrual Loans | 338 | 527 | 1,100 | 2,100 | |
Loans and Leases Receivable, Impaired, Commitment to Lend | $ 0 | $ 0 | $ 36 |
Investments: Available-for-sale Securities (Details) (USD $)
In Thousands, unless otherwise specified |
Sep. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Available-for-sale Securities, Amortized Cost Basis | $ 157,335 | $ 127,701 |
Available-for-sale Securities, Gross Unrealized Gains | 2,009 | 1,855 |
Available-for-sale Securities, Gross Unrealized Losses | (385) | (554) |
Investments available for sale, at fair value | 158,959 | 129,002 |
Mortgage-backed investments, Fannie Mae
|
||
Available-for-sale Securities, Amortized Cost Basis | 38,253 | 50,981 |
Available-for-sale Securities, Gross Unrealized Gains | 1,341 | 1,182 |
Available-for-sale Securities, Gross Unrealized Losses | (1) | |
Investments available for sale, at fair value | 39,593 | 52,163 |
Mortgage-backed investments, Freddie Mac
|
||
Available-for-sale Securities, Amortized Cost Basis | 16,439 | 19,285 |
Available-for-sale Securities, Gross Unrealized Gains | 376 | 560 |
Investments available for sale, at fair value | 16,815 | 19,845 |
Mortgage-backed investments, Ginnie Mae
|
||
Available-for-sale Securities, Amortized Cost Basis | 33,199 | 7,416 |
Available-for-sale Securities, Gross Unrealized Gains | 90 | 79 |
Available-for-sale Securities, Gross Unrealized Losses | (124) | |
Investments available for sale, at fair value | 33,165 | 7,495 |
Municipal Bonds
|
||
Available-for-sale Securities, Amortized Cost Basis | 2,049 | 2,085 |
Available-for-sale Securities, Gross Unrealized Gains | 11 | 32 |
Available-for-sale Securities, Gross Unrealized Losses | (233) | (270) |
Investments available for sale, at fair value | 1,827 | 1,847 |
US Government-sponsored Enterprises Debt Securities
|
||
Available-for-sale Securities, Amortized Cost Basis | 67,395 | 47,934 |
Available-for-sale Securities, Gross Unrealized Gains | 191 | 2 |
Available-for-sale Securities, Gross Unrealized Losses | (27) | (284) |
Investments available for sale, at fair value | $ 67,559 | $ 47,652 |
Loans Receivable: Schedule of non-accrual loans (Tables)
|
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Tables/Schedules | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of non-accrual loans |
|
Stock-Based Compensation: Fair Value Assumptions and Methodology (Details) (First Financial Northwest, Inc. 2008 Equity Incentive Plan, Stock Options, USD $)
|
9 Months Ended |
---|---|
Sep. 30, 2012
|
|
First Financial Northwest, Inc. 2008 Equity Incentive Plan | Stock Options
|
|
Fair Value, Option, Methodology and Assumptions | Black-Scholes model |
Stock Granted During Period, Shares, Share-based Compensation | 50,000 |
Fair Value Assumptions, Expected Dividend Rate | 0.00% |
Fair Value Assumptions, Expected Volatility Rate | 30.00% |
Fair Value Assumptions, Risk Free Interest Rate | 1.06% |
Fair Value Assumptions, Expected Term | 6 years 6 months |
Weighted-average grant date fair value per option granted | $ 2.58 |
Loans Receivable: Schedule of Non-performing assets and troubled debt restructured loans (Details) (USD $)
In Thousands, unless otherwise specified |
Sep. 30, 2012
|
Jun. 30, 2012
|
Dec. 31, 2011
|
Sep. 30, 2011
|
Jun. 30, 2011
|
Dec. 31, 2010
|
||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Financing Receivable, Recorded Investment, Nonaccrual Status | $ 18,570 | [1] | $ 18,613 | [1] | ||||||||||
Nonaccrual Troubled Debt Restructured Loans | 5,013 | [1] | 5,079 | [1] | ||||||||||
Nonaccrual Loans, total | 23,583 | [1] | 23,692 | [1] | ||||||||||
Other Real Estate | 19,209 | [2] | 22,206 | 26,044 | [3] | 25,201 | 25,979 | 30,102 | ||||||
Non Performing Assets | 42,792 | 49,736 | ||||||||||||
Troubled Debt Restructured Loans, now performing | 64,768 | 66,225 | ||||||||||||
Troubled Debt Restructured Loans, nonaccrual status | 5,013 | 5,079 | ||||||||||||
Loans and Leases Receivable, Impaired, Troubled Debt Restructuring, Amount | 69,781 | 71,304 | ||||||||||||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | $ 0 | $ 0 | ||||||||||||
|
Earnings Per Share: Schedule of Earnings Per Share Reconciliation (Details) (USD $)
|
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2011
|
Sep. 30, 2012
|
Sep. 30, 2011
|
|
Weighted Average Number of Shares Outstanding, Basic | 17,658,005 | 17,545,157 | 17,629,863 | 17,519,016 |
Weighted Average Number Diluted Shares Outstanding Adjustment | 18,137 | |||
Weighted Average Number of Shares Outstanding, Diluted | 17,658,005 | 17,545,157 | 17,648,000 | 17,519,016 |
Basic earnings (loss) per share | $ (0.04) | $ 0.04 | $ 0.07 | $ 0.19 |
Diluted earnings (loss) per share | $ (0.04) | $ 0.04 | $ 0.07 | $ 0.19 |
Earnings Per Share (Details)
|
9 Months Ended |
---|---|
Sep. 30, 2012
|
|
On September 30, 2012
|
|
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,348,524 |
On September 30, 2011
|
|
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,323,524 |
Federal Home Loan Bank Stock (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified |
Sep. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Federal Home Loan Bank stock, at cost | $ 7,347 | $ 7,413 |
Federal Home Loan Bank Stock, Par Value | $ 100 |
Investments: Available-for-sale Securities (Tables)
|
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2012
|
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Tables/Schedules | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Available-for-sale Securities |
|
Investments: Gain/Loss on Investments (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2011
|
Sep. 30, 2012
|
Sep. 30, 2011
|
|
Value of Investments sold during period | $ 0 | $ 43,100 | $ 22,900 | $ 72,900 |
Gain (Loss) on Investments | 487 | 294 | 1,700 | |
Marketable Securities, Loss (Gain) | $ 0 | $ 6 | $ 8 |
Fair Value: Schedule of quantitative information about Level 3 Fair Value Measurements on a nonrecurring basis (Tables)
|
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
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Tables/Schedules | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of quantitative information about Level 3 Fair Value Measurements on a nonrecurring basis |
|
Federal Income Taxes (Details) (USD $)
In Thousands, unless otherwise specified |
Sep. 30, 2012
|
---|---|
Deferred Tax Assets, Gross | $ 26,400 |
Deferred Tax Assets, Valuation Allowance | $ 22,100 |
Loans Receivable: Troubled Debt Restructurings on Financing Receivables (Tables)
|
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2012
|
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Tables/Schedules | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Troubled Debt Restructurings on Financing Receivables |
|
Loans Receivable (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 9 Months Ended | |
---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2012
|
Dec. 31, 2011
|
|
Loans Held-for-sale, Other | $ 0 | $ 0 | $ 0 |
TroubledDebtRestructuringCommitmentToExtendAdditionalCredit | 0 | 0 | |
Troubled debt restructuring, charge to Allowance for Loan and Lease Losses | $ 107,000 | $ 751,000 |
Fair Value: Schedule of balances of assets and liabilities, measured at fair value on a non-recurring basis (Details) (USD $)
In Thousands, unless otherwise specified |
Sep. 30, 2012
|
Jun. 30, 2012
|
Dec. 31, 2011
|
Sep. 30, 2011
|
Jun. 30, 2011
|
Dec. 31, 2010
|
||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
LoansandLeasesReceivable,Impaired | $ 86,828 | [1],[2] | $ 89,389 | [3] | ||||||||||||||
ImpairedLoansincludingundisbursedbutcommittedfunds | 1,523 | [1],[2] | 564 | [3] | ||||||||||||||
Other Real Estate | 19,209 | [4] | 22,206 | 26,044 | [5] | 25,201 | 25,979 | 30,102 | ||||||||||
OREO | 1,157 | [4] | 1,924 | [5] | ||||||||||||||
ImpairedLoansReceivableandotherrealestateowned,FairValueMeasurement | 106,037 | 115,433 | ||||||||||||||||
AccruedlossesonImpairedLoansandOtherRealEstateOwned | 2,680 | 2,488 | ||||||||||||||||
Fair Value, Inputs, Level 3
|
||||||||||||||||||
LoansandLeasesReceivable,Impaired | 86,828 | [1],[2] | 89,389 | [3] | ||||||||||||||
Other Real Estate | 19,209 | [4] | 26,044 | [5] | ||||||||||||||
ImpairedLoansReceivableandotherrealestateowned,FairValueMeasurement | $ 106,037 | $ 115,433 | ||||||||||||||||
|
Loans Receivable: Financing Receivables, Summary of loans by type and payment activity (Details) (USD $)
In Thousands, unless otherwise specified |
Sep. 30, 2012
|
Dec. 31, 2011
|
||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Financing Receivable | $ 666,290 | [1],[2] | $ 721,608 | [1],[3] | ||||||||||||||
One-to-four family, residential
|
||||||||||||||||||
Financing Receivable | 313,562 | 335,376 | ||||||||||||||||
One-to-four family, residential | Performing Financing Receivable
|
||||||||||||||||||
Financing Receivable | 305,115 | [4] | 325,568 | [5] | ||||||||||||||
One-to-four family, residential | Nonperforming Financing Receivable
|
||||||||||||||||||
Financing Receivable | 8,447 | [6] | 9,808 | [7] | ||||||||||||||
Multifamily
|
||||||||||||||||||
Financing Receivable | 107,575 | [1],[2] | 113,263 | [1],[3] | ||||||||||||||
Multifamily | Performing Financing Receivable
|
||||||||||||||||||
Financing Receivable | 102,864 | [4] | 112,314 | [5] | ||||||||||||||
Multifamily | Nonperforming Financing Receivable
|
||||||||||||||||||
Financing Receivable | 4,711 | [6] | 949 | [7] | ||||||||||||||
Commercial Real Estate
|
||||||||||||||||||
Financing Receivable | 214,937 | [1],[2] | 231,837 | [1],[3] | ||||||||||||||
Commercial Real Estate | Performing Financing Receivable
|
||||||||||||||||||
Financing Receivable | 212,650 | [4] | 228,101 | [5] | ||||||||||||||
Commercial Real Estate | Nonperforming Financing Receivable
|
||||||||||||||||||
Financing Receivable | 2,287 | [6] | 3,736 | [7] | ||||||||||||||
Construction/Land Development
|
||||||||||||||||||
Financing Receivable | 15,935 | [1],[2] | 24,724 | [1],[3] | ||||||||||||||
Construction/Land Development | Performing Financing Receivable
|
||||||||||||||||||
Financing Receivable | 7,938 | [4] | 15,525 | [5] | ||||||||||||||
Construction/Land Development | Nonperforming Financing Receivable
|
||||||||||||||||||
Financing Receivable | 7,997 | [6] | 9,199 | [7] | ||||||||||||||
Business
|
||||||||||||||||||
Financing Receivable | 3,503 | [1],[2] | 3,909 | [1],[3] | ||||||||||||||
Business | Performing Financing Receivable
|
||||||||||||||||||
Financing Receivable | 3,503 | [4] | 3,909 | [5] | ||||||||||||||
Consumer
|
||||||||||||||||||
Financing Receivable | 10,778 | [1],[2] | 12,499 | [1],[3] | ||||||||||||||
Consumer | Performing Financing Receivable
|
||||||||||||||||||
Financing Receivable | 10,637 | [4] | 12,499 | [5] | ||||||||||||||
Consumer | Nonperforming Financing Receivable
|
||||||||||||||||||
Financing Receivable | 141 | [6] | ||||||||||||||||
Property, total
|
||||||||||||||||||
Financing Receivable | 666,290 | [1] | 721,608 | [1] | ||||||||||||||
Property, total | Performing Financing Receivable
|
||||||||||||||||||
Financing Receivable | 642,707 | [1] | 697,916 | [1] | ||||||||||||||
Property, total | Nonperforming Financing Receivable
|
||||||||||||||||||
Financing Receivable | 23,583 | [1] | 23,692 | [1] | ||||||||||||||
One-to-four family, residential, owner occupied
|
||||||||||||||||||
Financing Receivable | 169,051 | [1],[2] | 187,997 | [1],[3] | ||||||||||||||
One-to-four family, residential, owner occupied | Performing Financing Receivable
|
||||||||||||||||||
Financing Receivable | 163,400 | 183,000 | ||||||||||||||||
One-to-four family, residential, owner occupied | Nonperforming Financing Receivable
|
||||||||||||||||||
Financing Receivable | 5,700 | 5,000 | ||||||||||||||||
One-to-four family, residential, non-owner occupied
|
||||||||||||||||||
Financing Receivable | 144,511 | [1],[2] | 147,379 | [1],[3] | ||||||||||||||
One-to-four family, residential, non-owner occupied | Performing Financing Receivable
|
||||||||||||||||||
Financing Receivable | 141,700 | 142,600 | ||||||||||||||||
One-to-four family, residential, non-owner occupied | Nonperforming Financing Receivable
|
||||||||||||||||||
Financing Receivable | $ 2,800 | $ 4,800 | ||||||||||||||||
|
Investments: Schedule of Available for sale Securities in Continuous Unrealized Loss positions (Details) (USD $)
In Thousands, unless otherwise specified |
Sep. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | $ 34,133 | $ 45,039 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses | (152) | (284) |
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | 1,173 | 1,137 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses | (233) | (270) |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 35,306 | 46,176 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses | (385) | (554) |
Mortgage-backed investments, Fannie Mae
|
||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | 4,892 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses | (1) | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 4,892 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses | (1) | |
Mortgage-backed investments, Ginnie Mae
|
||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | 16,358 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses | (124) | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 16,358 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses | (124) | |
Municipal Bonds
|
||
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | 1,173 | 1,137 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses | (233) | (270) |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 1,173 | 1,137 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses | (233) | (270) |
US Government-sponsored Enterprises Debt Securities
|
||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | 12,883 | 45,039 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses | (27) | (284) |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 12,883 | 45,039 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses | $ (27) | $ (284) |
Regulatory Items
|
9 Months Ended |
---|---|
Sep. 30, 2012
|
|
Notes | |
Regulatory Items | (2) Note 2 Regulatory Items
On April 14, 2010, the Office of Thrift Supervision (OTS) and members of the Board of Directors of First Financial Northwest entered into an informal supervisory agreement or Memorandum of Understanding (MOU), which is now enforced by the FRB, the successor to the OTS as the regulator of the holding company. Under the terms of the MOU, the Company agreed, among other things, to provide notice to and obtain a written non-objection from the FRB prior to the Company (a) declaring a dividend or redeeming any capital stock and (b) incurring, issuing, renewing or repurchasing any new debt.
On March 27, 2012, the Banks regulators, the FDIC and the DFI, terminated the Consent Order (Order) which became effective on September 24, 2010. In place of the Order, the Bank entered into an MOU which is an informal regulatory action, with the FDIC and DFI. The Order was terminated as a result of the steps the Bank took in complying with the Order, including reducing its level of classified assets, increasing earnings, augmenting management and improving the overall condition of the Bank.
The MOU with the Bank contains provisions concerning the management and directors of the Bank, interest rate risk, minimum capital levels, the allowance for loan and lease losses (ALLL), lending and collection policies, policies concerning the Bank and its affiliates, restrictions on paying dividends and a requirement to furnish progress reports to the FDIC and DFI. A copy of the MOU with the Bank is attached to the Form 8-K that we filed with the Securities and Exchange Commission (SEC) on April 2, 2012. |
Loans Receivable: Troubled Debt Restructurings on Financing Receivables (Details) (USD $)
In Thousands, unless otherwise specified |
Sep. 30, 2012
|
Sep. 30, 2011
|
---|---|---|
Preceding 3 months
|
||
Financing Receivable, Modifications, Number of Contracts | 22 | 15 |
Financing Receivable, Modifications, Pre-Modification Recorded Investment | $ 3,821 | $ 3,490 |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 3,809 | 3,481 |
Preceding 3 months | One-to-four family, residential | Principal and Interest with Interest Rate Concession
|
||
Financing Receivable, Modifications, Number of Contracts | 21 | 14 |
Financing Receivable, Modifications, Pre-Modification Recorded Investment | 3,750 | 2,471 |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 3,738 | 2,464 |
Preceding 3 months | One-to-four family, residential | PrincipalAndInterestReamortizedNoInterestConcessionMember
|
||
Financing Receivable, Modifications, Number of Contracts | 1 | |
Financing Receivable, Modifications, Pre-Modification Recorded Investment | 71 | |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 71 | |
Preceding 3 months | One-to-four family, residential | Interest only payments, with Interest Rate Concession
|
||
Financing Receivable, Modifications, Number of Contracts | 1 | |
Financing Receivable, Modifications, Pre-Modification Recorded Investment | 1,019 | |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 1,017 | |
Preceding 9 months
|
||
Financing Receivable, Modifications, Number of Contracts | 26 | 43 |
Financing Receivable, Modifications, Pre-Modification Recorded Investment | 7,958 | 12,306 |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 7,925 | 11,665 |
Preceding 9 months | One-to-four family, residential | Principal and Interest with Interest Rate Concession
|
||
Financing Receivable, Modifications, Number of Contracts | 22 | 23 |
Financing Receivable, Modifications, Pre-Modification Recorded Investment | 3,964 | 6,190 |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 3,950 | 6,069 |
Preceding 9 months | One-to-four family, residential | PrincipalAndInterestReamortizedNoInterestConcessionMember
|
||
Financing Receivable, Modifications, Number of Contracts | 1 | |
Financing Receivable, Modifications, Pre-Modification Recorded Investment | 71 | |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 71 | |
Preceding 9 months | One-to-four family, residential | Interest only payments, with Interest Rate Concession
|
||
Financing Receivable, Modifications, Number of Contracts | 12 | |
Financing Receivable, Modifications, Pre-Modification Recorded Investment | 4,459 | |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 4,451 | |
Preceding 9 months | One-to-four family, residential | ABNoteRestructureMember
|
||
Financing Receivable, Modifications, Number of Contracts | 6 | |
Financing Receivable, Modifications, Pre-Modification Recorded Investment | 1,130 | |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 635 | |
Preceding 9 months | One-to-four family, residential | InterestOnlyPaymentsWithNoInterestRateConcessionMember
|
||
Financing Receivable, Modifications, Number of Contracts | 2 | |
Financing Receivable, Modifications, Pre-Modification Recorded Investment | 527 | |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 510 | |
Preceding 9 months | Commercial Real Estate | Principal and Interest with Interest Rate Concession
|
||
Financing Receivable, Modifications, Number of Contracts | 1 | |
Financing Receivable, Modifications, Pre-Modification Recorded Investment | 1,415 | |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 1,400 | |
Preceding 9 months | Commercial Real Estate | Interest only payments, with Interest Rate Concession
|
||
Financing Receivable, Modifications, Number of Contracts | 2 | |
Financing Receivable, Modifications, Pre-Modification Recorded Investment | 2,508 | |
Financing Receivable, Modifications, Post-Modification Recorded Investment | $ 2,504 |