-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MAsy8QuhPtqxRhJIkNw8TTbH3LIW6kNa8j/ETPFeXRexd3m2q+PGmj4NSeEKcTch +D44el8quJLLmHHlthJgZw== 0000921183-96-000008.txt : 19960718 0000921183-96-000008.hdr.sgml : 19960718 ACCESSION NUMBER: 0000921183-96-000008 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960718 ITEM INFORMATION: Other events FILED AS OF DATE: 19960717 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: HMN FINANCIAL INC CENTRAL INDEX KEY: 0000921183 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 411777397 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-24100 FILM NUMBER: 96595965 BUSINESS ADDRESS: STREET 1: 101 N BROADWAY CITY: SPRING VALLEY STATE: MN ZIP: 55975-1223 BUSINESS PHONE: 5073467345 8-K 1 2ND QUARTER EARNINGS SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) July 18, 1996 HMN FINANCIAL, INC. (Exact name of Registrant as specified in its Charter) Delaware 0-24100 41-1777397 (State or other (Commission File No.) (IRS Employer jurisdiction of Identification incorporation) Number) 101 North Broadway, Spring Valley, Minnesota 55975 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (507) 346-7345 N/A (Former name or former address, if changed since last report) Item 5. Other Events On July 18, 1996, the Registrant issued the attached press release announcing quarterly earnings. Item 7. Financial Statements and Exhibits (a) Exhibits 99. Press release, July 18, 1996. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized. HMN FINANCIAL, INC. Date: July 18, 1996 By: /s/ Roger P. Weise ------------------------ Roger P. Weise, Chairman President and Chief Executive Officer Exhibit 99 EX-99 2 2ND QTR PRESS RELEASE [logo of open winged eagle] HMN FINANCIAL, INC. 101 North Broadway P.O. Box 231 Spring Valley, MN 55975-0231 Phone (507) 346-7345 Fax (507) 346-1111 NEWS RELEASE CONTACT: James B. Gardner, Executive Vice President HMN Financial, Inc. (507) 346-7345 FOR IMMEDIATE RELEASE HMN FINANCIAL, INC. ANNOUNCES QUARTERLY RESULTS - ----------------------------------------------- EARNINGS SUMMARY Three Months Ended Six Months Ended June 30, June 30, ------------------ ----------------- 1996 1995 1996 1995 -------- -------- -------- -------- Net income $1,533,084 1,405,472 $3,119,775 2,768,898 Earnings per common share and common share equivalent 0.34 0.27 0.67 0.52 Return on average assets 1.13% 1.07% 1.15% 1.07% Return on average common equity 6.77% 5.82% 6.84% 5.70% Book value per share $ 17.73 16.38 $ 17.73 16.38 SPRING VALLEY, MINNESOTA, July 18, 1996 . . . HMN Financial, Inc. (HMN) (NASDAQ:HMNF), the $555 million holding company for Home Federal Savings Bank (the Bank), today reported net income of $1.5 million for the second quarter of 1996, up 9% from $1.4 million for the second quarter of 1995. Earnings per share were $0.34 for the second quarter of 1996, up 26% from $0.27 per share for the second quarter of 1995. Return on average assets was 1.13% and return on average equity was 6.77% for the second quarter of 1996, an increase of 6% and 16%, respectively, from the second quarter of 1995. Book value per share was $17.73, up 8%, from $16.38 for the second quarter of 1995. Net income for the six months ended June 30, 1996 was $3.1 million, up 13% from $2.8 million for the six months ended June 30, 1995. Earnings per share were $0.67 for the six months ended June 30, 1996, up 29% from $0.52 per share for the same period in 1995. Return on average assets was 1.15% and return on average equity was 6.84% for the six months ended June 30, 1996, an increase of 7% and 20%, respectively, from the same period in 1995. HMN Financial, Inc.'s Chairman, Roger P. Weise, said that he was pleased with the increased earnings per share for both the quarter and the six month period ended June 30, 1996. The increased earnings per share is primarily due to an increase in earnings coupled with the repurchase of HMN's own common stock from the open market. Net income for the second quarter of 1996 compared to the second quarter of 1995 increased by $128,000, or 9.1%, principally due to an increase of $274,000 in net security gains which was partially offset by an increase of $121,000 in compensation and benefit expenses. Net income for the six month period ended June 30, 1996 compared to the same period of 1995 increased by $351,000, or 12.7%, principally due to an increase of $781,000 in net security gains which was partially offset by an increase of $267,000 in compensation and benefit expenses. Net interest income was $4.0 million for both the second quarter of 1996 and the second quarter of 1995. Net interest income for the six months ended June 30, 1996 was $7.91 million, a decrease of $56,000, or 0.7%, from $7.97 million for the six months ended June 30, 1995. HMN has been purchasing its own stock in the open market at an average price that is less than its current book value. The balance sheet impact of the stock repurchase program has been to reduce equity and replace it with additional advances or deposit growth. As HMN has increased in total assets its average interest-earning assets have increased at a slower pace than its average outstanding interest-bearing liabilities. Therefore, interest expense has increased at a more rapid pace than interest income. The more rapid increase in liabilities coupled with changing interest rates caused net interest income for the second quarter of 1996 to be the same as the second quarter of 1995. It was also the principal cause for the decrease in net interest income when comparing the six months ended June 30, 1996 to the same period of 1995. Non-interest income was $485,000 for the second quarter of 1996, an increase of $304,000, or 168%, compared to $181,000 for the second quarter of 1995. The increase was principally due to a $274,000 increase in gain on the sale of securities, a $104,000 increase in other income and was partially offset by a $76,000 decrease in gain on sale of loans. Non- interest income for the six months ended June 30, 1996 was $1.2 million, an increase of $901,000, or 316%, compared to $285,000 for the six months ended June 30, 1995. The increase was principally due to a $781,000 increase in gain on the sale of securities, a $184,000 increase in other income and was partially offset by a $70,000 decrease in gain on sale of loans. Non-interest expense was $1.98 million for the second quarter of 1996, an increase of $147,000, or 8%, from $1.84 million for the second quarter of 1995. The majority of the increase in non-interest expense between the two quarters was due to a $121,000, or 12.4%, increase in compensation and benefits and was the result of adding new employees, normal merit and salary increases and the impact of the Recognition and Retention Plan adopted in June of 1995. Non-interest expense for the six months ended June 30, 1996 was $3.967 million, an increase of $318,000, or 8.7%, from $3.649 million for the six months ended June 30, 1995. The principal cause for the increase in non-interest expense between the two periods was due to a $267,000, or 13.8%, increase in compensation and benefits expense and was the result of adding new employees, normal merit and salary increases and the impact of the Recognition and Retention Plan adopted in June of 1995. During July of 1996, HMN completed the purchase of 246,060 shares of its own stock in the open market. HMN Financial, Inc. and Home Federal Savings Bank are headquartered in Spring Valley, MN. The Bank operates seven offices in southern Minnesota. (Three pages of selected consolidated financial information are included with this release.) ***END*** HMN FINANCIAL, INC. AND SUBSIDIARIES Consolidated Balance Sheets (unaudited)
June 30, December 31, ASSETS 1996 1995 --------------- -------------- Cash and cash equivalents $ 5,942,504 4,334,694 Securities available for sale: Mortgage-backed and related securities (amortized cost $151,722,163 and $158,517,548) 148,705,801 158,416,201 Other marketable securities (amortized cost $41,173,928 and $32,247,959) 40,441,555 31,903,566 ------------ ------------ 189,147,356 190,319,767 ------------ ------------ Securities held to maturity: Mortgage-backed and related securities (estimated market value $13,952,026 and $13,931,879) 13,834,625 13,744,063 Other marketable securities (estimated market value $996,540 and $3,224,263) 999,343 3,227,729 ------------ ------------ 14,833,968 16,971,792 ------------ ------------ Loans receivable, net 331,649,722 314,850,684 Federal Home Loan Bank stock, at cost 5,157,900 3,801,900 Real estate, net 153,122 279,851 Premises and equipment, net 3,547,124 3,645,536 Accrued interest receivable 3,425,342 3,381,507 Deferred income taxes 635,326 0 Prepaid expenses and other assets 486,959 362,928 ------------ ------------ Total assets $ 554,979,323 537,948,659 ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY Deposits $ 363,194,751 373,539,468 Federal Home Loan Bank advances 101,053,053 68,876,978 Accrued interest payable 1,717,330 1,562,347 Advance payments by borrowers for taxes and insurance 517,502 550,990 Accrued expenses and other liabilities 1,233,906 1,732,193 ------------ ------------ Total liabilities 467,716,542 446,261,976 ------------ ------------ Commitments and contingencies Stockholders' equity: Serial preferred stock: authorized 500,000 shares; issued and outstanding none 0 0 Common stock ($.01 par value): authorized 7,000,000 shares; issued 6,085,775 shares 60,858 60,858 Additional paid-in capital 59,348,005 59,285,581 Retained earnings, subject to certain restrictions 53,490,813 50,371,038 Net unrealized loss on securities available for sale (2,231,697) (265,358) Unearned employee stock ownership plan shares (5,137,310) (5,336,150) Unearned compensation restricted stock awards (933,605) (1,050,305) Treasury stock, shares at cost 1,164,575 and 783,850 (17,334,283) (11,378,981) ------------- ------------ Total stockholders' equity 87,262,781 91,686,683 ------------ ------------ Total liabilities and stockholders' equity $554,979,323 537,948,659 ============ ============
HMN FINANCIAL, INC. AND SUBSIDIARIES Consolidated Statements of Income (unaudited)
Three Months Ended Six Months Ended June 30, June 30, 1996 1995 1996 1995 --------------------------------------------- Interest Income: Loans receivable $6,409,310 5,727,836 12,548,056 11,182,650 Securities available for sale: Mortgage-backed and related 2,527,670 2,598,254 5,301,360 5,255,555 Other marketable 580,897 828,629 985,741 1,377,378 Securities held to maturity: Mortgage-backed and related 256,754 163,004 523,777 292,827 Other marketable 32,405 125,210 75,853 250,963 Cash equivalents 62,086 132,915 165,804 272,511 Other 74,648 59,919 138,630 112,368 --------- --------- ---------- ---------- Total interest income 9,943,770 9,635,767 19,739,221 18,744,252 --------- --------- ---------- ---------- Interest expense: Deposits 4,720,966 4,630,653 9,539,249 8,917,227 Federal Home Loan Bank advances 1,227,662 1,025,995 2,289,523 1,860,776 --------- --------- ---------- ---------- Total interest expense 5,948,628 5,656,648 11,828,772 10,778,003 --------- --------- ---------- ---------- Net interest income 3,995,142 3,979,119 7,910,449 7,966,249 Provision for loan losses 75,000 75,000 150,000 150,000 --------- --------- ---------- ---------- Net interest income after provision for loan losses 3,920,142 3,904,119 7,760,449 7,816,249 --------- --------- ---------- ---------- Non-interest income: Fees and service charges 81,855 79,342 159,371 153,133 Securities gains (losses), net 268,487 (5,190) 769,037 (11,867) Gain on sales of loans 1,135 76,951 7,084 76,951 Other 133,533 30,007 250,922 66,864 --------- --------- ---------- ---------- Total non-interest income 485,010 181,110 1,186,414 285,081 --------- --------- ---------- ---------- Non-interest expense: Compensation and benefits 1,099,123 977,992 2,205,118 1,937,821 Occupancy 195,363 186,298 392,145 365,857 Federal deposit insurance premiums 214,864 198,474 424,656 396,947 Advertising 79,354 66,650 152,039 138,138 Data processing 120,743 120,902 249,196 243,682 Other 274,789 287,016 543,902 566,220 --------- --------- ---------- ---------- Total non-interest expense 1,984,236 1,837,332 3,967,056 3,648,665 --------- --------- ---------- ---------- Income before income tax expense 2,420,916 2,247,897 4,979,807 4,452,665 Income tax expense 887,832 842,425 1,860,032 1,683,768 --------- --------- ---------- ---------- Net income $1,533,084 1,405,472 3,119,775 2,768,897 ========= ========= ========== ========== Earnings per common share and common share equivalents $ 0.34 0.27 0.67 0.52 ========= ========= ========== ==========
HMN FINANCIAL, INC. AND SUBSIDIARIES Selected Consolidated Financial Information (unaudited)
Selected Financial Data: (dollars in thousands, except per share data) Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, 1996 1995 1996 1995 -------------------- -------------------- I. OPERATING DATA: Interest income $ 9,944 9,636 19,739 18,744 Interest expense 5,949 5,657 11,829 10,778 Net interest income 3,995 3,979 7,910 7,966 II. AVERAGE BALANCES: Assets (1) 547,513 527,280 543,787 519,700 Loans receivable, net 320,832 282,430 315,979 278,053 Mortgage-backed and related securities (1) 166,897 162,898 170,292 165,406 Interest earnings assets (1) 537,290 522,704 534,012 513,000 Interest bearing liabilities 450,704 425,754 446,148 416,968 Equity (1)(2) 91,082 96,877 91,697 97,971 III.PERFORMANCE RATIOS: (1) Return on average assets (annualized) 1.13% 1.07% 1.15% 1.07% Interest rate spread information: Average during period 2.11 2.06 2.09 2.16 End of period 2.23 2.11 2.23 2.11 Net interest margin 2.98 3.05 2.97 3.13 Ratio of operating expense to average total assets 1.46 1.40 1.47 1.42 Return on average equity (annualized) 6.77 5.82 6.84 5.70
June 30, Dec 31, June 30, 1996 1995 1995 ----------------------------- IV.ASSET QUALITY: Total non-performing assets $ 523 850 369 Non-performing assets to total assets 0.09% 0.16% 0.07% Non-performing loans to total loans receivable, net 0.11 0.17 0.10 Allowance for loan losses $ 2,339 2,191 2,042 Allowance for loan losses to total assets 0.42% 0.41% 0.38% Allowance for loan losses to total loans receivable, net 0.71 0.70 0.71 Allowance for loan losses to nonperforming loans 668.75 409.13 706.55 V. BOOK VALUE PER SHARE: Book value per share excluding net unrealized loss on securities available for sale(3) $ 18.19 17.34 16.56 Book value per share(3) 17.73 17.29 16.38
Six Months Twelve Months Six Months Ended Ended Ended June 30, 1996 Dec. 31, 1995 June 30, 1995 ------------------------------------------- VI. CAPITAL RATIOS Stockholders' equity or retained earnings to total assets, at end of period 15.72% 17.04% 17.91% Average stockholders' equity or average retained earnings to average assets (1)(2) 16.86 18.24 18.85% Ratio of average interest- earning assets to average interest-bearing liabilities(1) 119.69 121.95 123.03% Average balances were calculated based upon amortized cost without the market value impact of SFAS 115. Average equity and average equity/average asset ratio decreasing due in part by a repurchase of 568,336 shares of common stock in the second half of 1995 and an additional repurchase of 380,725 shares of common stock in the first half of 1996. On June 21, 1995 84,486 shares of restricted common stock were awarded to directors and officers and are included as outstanding shares for book value calculations.
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