UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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) January 31, 2012
Emclaire Financial Corp.
(Exact name of registrant as specified in its charter)
Pennsylvania | 001-34527 | 25-1606091 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
612 Main Street, Emlenton, PA | 16373 | |||
(Address of principal executive offices) | (Zip Code) |
Registrant's telephone number, including area code: (724) 867-2311
________________________________________________________________________________
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: | ||
[ ] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
[ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
[ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
[ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
EMCLAIRE FINANCIAL CORP.
CURRENT REPORT ON FORM 8-K
Item 2.02. Results of Operations and Financial Condition.
On January 31, 2012, Emclaire Financial Corp. announced its results of operations for the quarter and year ended December 31, 2011. A copy of the related press release is being filed as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference in its entirety. The information furnished under Item 9.01 of this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be "filed" for purposes of the Securities Exchange Act of 1934, as amended.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit Number
Description
99.1
Press Release dated January 31, 2012 issued by Emclaire Financial Corp.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Emclaire Financial Corp. (Registrant) |
||
January 31, 2012 (Date) |
/s/ WILLIAM C. MARSH William C. Marsh Chief Executive Officer President |
EXHIBIT 99.1
EMLENTON, Pa., Jan. 31, 2012 (GLOBE NEWSWIRE) -- Emclaire Financial Corp. (Nasdaq:EMCF), the parent holding company of The Farmers National Bank of Emlenton, reported consolidated net income of $3.8 million for 2011, compared to $3.1 million for 2010. Primarily contributing to the improvement of earnings was an increase in net interest income and a decrease in the provision for loan losses, along with a modest increase in recurring noninterest income. The Corporation realized a return on average assets of 0.78% and a return on average common equity of 8.98% for the year ended December 31, 2011, which compares favorably to 0.64% and 8.48%, respectively, as reported for 2010.
Net income was $1.2 million for the quarter ended December 31, 2011, compared to $583,000 for the same period in 2010. The fourth quarter of 2011 included $100,000 in provision for loan loss compared to $841,000 for the same quarter in 2010.
FINANCIAL HIGHLIGHTS
William C. Marsh, Chairman, President and Chief Executive Officer of the Corporation and the Bank, noted, "The Board of Directors, management and I are quite pleased with the record earnings for 2011 and the continued growth of our franchise. During this past year, we have seen a strong increase in net interest revenues and core noninterest revenues and disciplined management of operating expenses. Further, we solidified our already sound capital and earnings base through our first quarter common stock offering, the SBLF funding and TARP/CPP repayment, and through hands-on balance sheet and credit quality management. Our record financial performance was a direct result of our business development efforts, customer retention strategies and expansion in our markets."
YEAR-TO-DATE OPERATING RESULTS OVERVIEW
Net income available to common stockholders increased $640,000 or 23.9% to $3.3 million or $1.98 per common share in 2011, compared to $2.7 million or $1.85 per common share in 2010. The increase was primarily related to a $624,000 increase in net interest income and a $886,000 decrease in the provision for loan losses, partially offset by a $365,000 decrease in noninterest income and increases in noninterest expense and the provision for income taxes of $232,000 and $149,000, respectively.
Net interest income increased $624,000 or 4.2% to $15.4 million for the year ended December 31, 2011 from $14.8 million in 2010. The increase in net interest income was primarily related to a decrease in interest expense of $1.2 million or 16.9% as the Corporation's cost of funds decreased 29 basis points to 1.33% for 2011 from 1.62% for 2010. Driving this improvement was a $718,000 decrease in interest paid on deposits and a $479,000 decrease in interest paid on borrowings, the latter of which related to the Corporation's repayment of $10.0 million in borrowings during the year. The Corporation improved its non-time deposit ratio to 65.1% at December 31, 2011 from 64.7% at December 31, 2010, resulting in an overall reduction in deposit costs.
Noninterest income decreased $365,000 or 8.7% to $3.8 million for the year ended December 31, 2011 from $4.2 million for the same period in 2010. The decrease was primarily related to a $493,000 decrease in nonrecurring securities gains and a $180,000 decrease in fees from financial services, which were partially offset by increases in customer service fees and other income of $71,000 and $248,000, respectively. Excluding the securities gains, recurring noninterest income increased 3.9% to $3.4 million in 2011 from $3.2 million in 2010.
The provision for loan losses declined $886,000 or 67.8% to $420,000 for the year ended December 31, 2011 from $1.3 million in 2010. The decrease was primarily related to the successful resolution and payoff of certain nonperforming commercial credit relationships in the third quarter of 2011, which led to a decline in the ratio of nonperforming assets to total assets to 1.19% at December 31, 2011 from 1.45% at December 31, 2010 and an overall decrease in the provision for loan losses. The Corporation continues to maintain sound asset quality as delinquencies continue to remain below national and peer averages.
Noninterest expense increased $232,000 or 1.7% to $14.0 million for the year ended December 31, 2011 from $13.8 million for the prior year. The increase was primarily related to increases in compensation and benefits, premises and equipment, professional fees and other noninterest expense of $248,000, $55,000, $158,000 and $54,000, respectively. Included in other noninterest expense was $336,000 in prepayment penalties incurred in the third quarter of 2011 associated with the early retirement of a $5.0 million Federal Home Loan Bank advance, compared to $557,000 in prepayment penalties related to the early retirement of $10.0 million in advances during 2010. On a recurring basis, which excludes the impact of the aforementioned prepayment penalties, noninterest expense increased $453,000 or 3.4% between the two annual periods.
The provision for income taxes increased $149,000 or 18.6% to $950,000 for the year ended December 31, 2011 from $801,000 for 2010. This increase was primarily related to an increase in pre-tax net income while the effective tax rate decreased slightly to 19.9% for 2011, compared to 20.7% for 2010.
The Corporation realized an annualized return on average assets and common equity of 0.78% and 8.98%, respectively, for the year ended December 31, 2011, compared to 0.64% and 8.48%, respectively, for 2010.
FOURTH QUARTER OPERATING RESULTS OVERVIEW
Net income available to common stockholders increased $548,000 to $1.0 million or $0.59 per common share for the quarter ended December 31, 2011 compared to $485,000 or $0.33 per common share for the same period last year. This increase was primarily related to a $741,000 decrease in provision for loan losses and a $174,000 increase in net interest income. Excluding $55,000 in other-than temporary impairment charges incurred during the fourth quarter of 2010, recurring noninterest income increased $15,000 or 1.8% to $863,000 for the current period from $848,000 for the same period last year. Partially offsetting these favorable variances, noninterest expense and the provision for income taxes increased $236,000 and $179,000, respectively, between the two quarterly periods. The Corporation continues to experience growth in recurring revenues as the aforementioned balance sheet management strategies and prudent management of deposit costs have fueled net interest income growth. The decrease in the provision for loan losses mostly relates to a reduction in classified and criticized assets and an overall improvement in credit quality.
The Corporation realized an annualized return on average assets and common equity of 0.93% and 10.23%, respectively, for the three months ended December 31, 2011, compared to 0.48% and 5.92%, respectively, for the same period last year.
CONSOLIDATED BALANCE SHEET & ASSET QUALITY OVERVIEW
Total assets increased $10.0 million or 2.1% to $491.9 million at December 31, 2011 from $481.9 million at December 31, 2010. Asset growth was primarily driven by increases in customer deposits of $6.8 million and stockholders' equity of $11.6 million, which funded increases in net loans of $6.4 million or 2.1% and cash and equivalents of $9.2 million or 48.2% and a reduction in borrowed funds of $10.0 million or 33.3%.
Total nonperforming assets were $5.9 million or 1.19% of total assets at December 31, 2011 compared to $7.0 million or 1.45% of total assets at December 31, 2010. This decrease in nonperforming assets was primarily due to the successful resolution and payoff of certain nonperforming commercial credit relationships, one of which represented $1.3 million in outstanding balances at December 31, 2010. Classified and criticized assets decreased $616,000 or 5.0% to $11.8 million at December 31, 2011 from $12.4 million at December 31, 2010.
Stockholders' equity increased $11.6 million or 29.7% to $50.7 million at December 31, 2011 compared to $39.1 million at December 31, 2010. Driving this change was an increase in common equity of $9.1 million or 29.0% to $40.7 million from $31.6 million, respectively, $4.6 million of which related to the private stock offering completed in early 2011. The Corporation remains well capitalized and is positioned for continued growth with total stockholders' equity at 10.3% of total assets. Book value and tangible book value per common share were $23.25 and $20.26, respectively, at December 31, 2011, compared to $21.67 and $17.77, respectively, at December 31, 2010.
ANNUAL SHAREHOLDER MEETING
In addition to reporting earnings, the Corporation announced that the annual meeting of shareholders will be held on Wednesday, April 25, 2012 at 9:00 a.m. at the main office of The Farmers National Bank of Emlenton, in Emlenton, Pennsylvania. The voting record date for the purpose of determining stockholders eligible to vote on proposals presented at the annual meeting will be March 1, 2012.
Emclaire Financial Corp. is the parent company of The Farmers National Bank of Emlenton, an independent, nationally chartered, FDIC-insured community bank headquartered in Emlenton, Pennsylvania, operating 13 full service offices in Venango, Butler, Clarion, Clearfield, Crawford, Elk, Jefferson and Mercer counties, Pennsylvania. The Corporation's common stock is quoted on and traded through the NASDAQ Capital Market under the symbol "EMCF". For more information, visit the Corporation's website at "www.emclairefinancial.com".
This news release may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements may contain words such as "believe", "expect", "anticipate", "estimate", "should", "may", "can", "will", "outlook", "project", "appears" or similar expressions. Such forward-looking statements are subject to risk and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors. Such factors include, but are not limited to, changes in interest rates which could affect net interest margins and net interest income, the possibility that increased demand or prices for the Corporation's financial services and products may not occur, changing economic and competitive conditions, technological and regulatory developments, and other risks and uncertainties, including those detailed in the Corporation's filings with the Securities and Exchange Commission. The Corporation does not undertake, and specifically disclaims any obligation to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements.
EMCLAIRE FINANCIAL CORP. | ||||
Consolidated Financial Highlights | ||||
(Unaudited - Dollar amounts in thousands, except share data) | ||||
CONSOLIDATED OPERATING RESULTS DATA: | Three month period | Year ended | ||
ended December 31, | December 31, | |||
2011 | 2010 | 2011 | 2010 | |
Interest income | $ 5,380 | $ 5,437 | $ 21,279 | $ 21,852 |
Interest expense | 1,362 | 1,593 | 5,872 | 7,069 |
Net interest income | 4,018 | 3,844 | 15,407 | 14,783 |
Provision for loan losses | 100 | 841 | 420 | 1,306 |
Noninterest income | 863 | 793 | 3,841 | 4,206 |
Noninterest expense | 3,289 | 3,053 | 14,045 | 13,813 |
Income before provision for income taxes | 1,492 | 743 | 4,783 | 3,870 |
Provision for income taxes | 339 | 160 | 950 | 801 |
Net income | 1,153 | 583 | 3,833 | 3,069 |
Accumulated preferred stock dividends and discount accretion | 120 | 98 | 517 | 393 |
Net income available to common stockholders | $ 1,033 | $ 485 | $ 3,316 | $ 2,676 |
Basic and diluted earnings per common share | $0.59 | $0.33 | $1.98 | $1.85 |
Dividends per common share | $0.16 | $0.14 | $0.64 | $0.56 |
Return on average assets (1) | 0.93% | 0.48% | 0.78% | 0.64% |
Return on average equity (1) | 9.13% | 5.71% | 8.44% | 7.85% |
Return on average common equity (1) | 10.23% | 5.84% | 8.98% | 8.48% |
Yield on average interest-earning assets | 4.75% | 4.91% | 4.74% | 4.94% |
Cost of average interest-bearing liabilities | 1.54% | 1.77% | 1.64% | 1.95% |
Cost of funds | 1.24% | 1.46% | 1.33% | 1.62% |
Net interest margin | 3.59% | 3.52% | 3.47% | 3.39% |
Efficiency ratio | 62.98% | 60.99% | 69.70% | 71.07% |
____________________ | ||||
(1) Returns are annualized for the three month period ended December 31, 2011. | ||||
CONSOLIDATED FINANCIAL CONDITION DATA: | As of | As of | ||
12/31/2011 | 12/31/2010 | |||
Total assets | $ 491,882 | $ 481,885 | ||
Cash and equivalents | 28,193 | 19,027 | ||
Securities | 123,154 | 125,820 | ||
Loans, net | 312,545 | 306,152 | ||
Deposits | 416,468 | 409,658 | ||
Borrowed funds | 20,000 | 30,000 | ||
Common stockholders' equity | 40,730 | 31,583 | ||
Stockholders' equity | 50,730 | 39,118 | ||
Book value per common share | $23.25 | $21.67 | ||
Tangible book value per common share | $20.26 | $17.77 | ||
Net loans to deposits | 75.05% | 74.73% | ||
Allowance for loan losses to total loans | 1.12% | 1.33% | ||
Nonperforming assets to total assets | 1.19% | 1.45% | ||
Earning assets to total assets | 95.18% | 95.95% | ||
Stockholders' equity to total assets | 10.31% | 8.12% | ||
Shares of common stock outstanding | 1,751,908 | 1,457,404 |
CONTACT: William C. Marsh Chairman, President and Chief Executive Officer Phone: (724) 867-2018 Email: wmarsh@farmersnb.com