FFD Financial Corporation reports net earning for three months ended Sept. 30
FFD Financial Corporation, parent company of First Federal Community Bank, reported net earnings for the three months ended Sept. 30, of $368,000, or diluted earnings per share of 36 cents, compared to net earnings of $414,000, or 41 cents per diluted share, for the comparable three-month period in 2010. The $46,000, or 11.1 percent, decrease in net earnings resulted from increases of $77,000, or 5.5 percent, in noninterest expense and $57,000, or 30.7 percent, in the provision for losses on loans and a decrease of $84,000, or 22.0 percent, in noninterest income, which were partially offset by an increase of $149,000, or 8.1 percent, in net interest income and a decrease of $23,000, or 10.7 percent, in the provision for federal income taxes.
The increase in net interest income was primarily due to the rates on interest bearing liabilities declining faster than the yields on interest earning assets. On an annualized basis, yields on interest earning assets decreased approximately 46 basis points period to period while the cost of interest bearing liabilities decreased approximately 55 basis points.
The decrease in noninterest income was primarily the result of a $97,000, or 37.3 percent, decrease in gain on sale of loans, which was partially offset by a $15,000, or 16.0 percent, increase in service charges on deposit accounts. The decrease in gain on sale of loans resulted from a 52.5 percent decrease in loans sold into the secondary mortgage market due to a significant decrease in the number of newly originated and refinanced loans in the current economic climate.
The increase in the provision for loan losses was due to management’s assessment of the loan portfolio, delinquency rates, net charge-offs, the adequacy of the existing allowance and current economic conditions. Net charge-offs were $451,000 for the quarter ended Sept. 30, and $77,000 for the comparable quarter in 2010. A large portion of the charge-offs in the 2011 period were previously allocated specific reserves. The decision to charge-off these loans was due to continued evaluation of the borrower’s ability to repay and economic circumstances. Non-performing loans were $1.8 million, or .82 percent, of total assets at June 30, compared to $2.0 million, or .89 percent, of total assets at Sept. 30.
FFD Financial Corporation reported total assets of $225.3 million at Sept. 30, an increase of $5.8 million over the June 30 balance. Cash and cash equivalents increased to $20.1 million at Sept. 30 from $16.3 million at June 30. Mortgage-backed securities remained relatively constant at $6.3 million at June 30 compared to $6.2 million at Sept. 30. Investment securities decreased from $6.0 million at June 30 to $2.0 million at Sept. 30 because investment securities called during the quarter ended Sept. 30 were not replaced. Loans receivable, net, increased $5.5 million from June 30 to $187.5 million at Sept. 30. Loans held for sale increased to $812,000 at Sept. 30 from none at June 30. Total liabilities increased by $5.4 million from the June 30 balance to $206.0 million at Sept. 30, and included deposits of $190.4 million, up from $185.0 million at June 30. Shareholders’ equity was $19.2 million at Sept. 30, a 1.4 percent increase over the June 30 balance of $19.0 million.
The coverage ratio for loan losses, or the allowance for loan losses as a percentage of total loans, decreased to 1.04 percent, at Sept. 30, from 1.18 percent at June 30. The decrease was primarily attributable to the charge-off of impaired loans which had $303,000 of specific reserves allocated to them in prior periods. An increase of $96,000 in general reserves was recorded on non-impaired loans during the quarter ended Sept. 30 as compared to the prior quarter largely in response to loan portfolio growth. Overall delinquency improved to 1.17 percent of total loans at Sept. 30 compared to 1.19 percent at June 30.
FFD Financial Corporation is traded on the NASDAQ Capital Market under the symbol FFDF. First Federal Community Bank has full service offices in downtown Dover, downtown New Philadelphia, on the Boulevard in Dover, in Sugarcreek and in Berlin. The corporation maintains an interactive website at https://www.onlinefirstfed.com.
The increase in net interest income was primarily due to the rates on interest bearing liabilities declining faster than the yields on interest earning assets. On an annualized basis, yields on interest earning assets decreased approximately 46 basis points period to period while the cost of interest bearing liabilities decreased approximately 55 basis points.
The decrease in noninterest income was primarily the result of a $97,000, or 37.3 percent, decrease in gain on sale of loans, which was partially offset by a $15,000, or 16.0 percent, increase in service charges on deposit accounts. The decrease in gain on sale of loans resulted from a 52.5 percent decrease in loans sold into the secondary mortgage market due to a significant decrease in the number of newly originated and refinanced loans in the current economic climate.
The increase in the provision for loan losses was due to management’s assessment of the loan portfolio, delinquency rates, net charge-offs, the adequacy of the existing allowance and current economic conditions. Net charge-offs were $451,000 for the quarter ended Sept. 30, and $77,000 for the comparable quarter in 2010. A large portion of the charge-offs in the 2011 period were previously allocated specific reserves. The decision to charge-off these loans was due to continued evaluation of the borrower’s ability to repay and economic circumstances. Non-performing loans were $1.8 million, or .82 percent, of total assets at June 30, compared to $2.0 million, or .89 percent, of total assets at Sept. 30.
FFD Financial Corporation reported total assets of $225.3 million at Sept. 30, an increase of $5.8 million over the June 30 balance. Cash and cash equivalents increased to $20.1 million at Sept. 30 from $16.3 million at June 30. Mortgage-backed securities remained relatively constant at $6.3 million at June 30 compared to $6.2 million at Sept. 30. Investment securities decreased from $6.0 million at June 30 to $2.0 million at Sept. 30 because investment securities called during the quarter ended Sept. 30 were not replaced. Loans receivable, net, increased $5.5 million from June 30 to $187.5 million at Sept. 30. Loans held for sale increased to $812,000 at Sept. 30 from none at June 30. Total liabilities increased by $5.4 million from the June 30 balance to $206.0 million at Sept. 30, and included deposits of $190.4 million, up from $185.0 million at June 30. Shareholders’ equity was $19.2 million at Sept. 30, a 1.4 percent increase over the June 30 balance of $19.0 million.
The coverage ratio for loan losses, or the allowance for loan losses as a percentage of total loans, decreased to 1.04 percent, at Sept. 30, from 1.18 percent at June 30. The decrease was primarily attributable to the charge-off of impaired loans which had $303,000 of specific reserves allocated to them in prior periods. An increase of $96,000 in general reserves was recorded on non-impaired loans during the quarter ended Sept. 30 as compared to the prior quarter largely in response to loan portfolio growth. Overall delinquency improved to 1.17 percent of total loans at Sept. 30 compared to 1.19 percent at June 30.
FFD Financial Corporation is traded on the NASDAQ Capital Market under the symbol FFDF. First Federal Community Bank has full service offices in downtown Dover, downtown New Philadelphia, on the Boulevard in Dover, in Sugarcreek and in Berlin. The corporation maintains an interactive website at https://www.onlinefirstfed.com.
Published: November 1, 2011
