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): February 3, 2014
BANKFINANCIAL CORPORATION
(Exact Name of Registrant as Specified in Charter)
Maryland | 0-51331 | 75-3199276 | ||
(State or Other Jurisdiction of Incorporation) | (Commission File No.) | (I.R.S. Employer Identification No.) | ||
15W060 North Frontage Road, Burr Ridge, Illinois | 60527 | |||
(Address of Principal Executive Offices) | (Zip Code) | |||
Registrant’s telephone number, including area code: (800) 894-6900
Not Applicable
(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 (see General Instruction A.2. below):
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. Results of Operations and Financial Condition
On February 3, 2014, the Company issued a press release announcing the results for the fourth quarter and year ended December 31, 2013 and issued the Fourth Quarter 2013 Quarterly Financial and Statistical Supplement for the latest five quarters. The press release and Quarterly Financial and Statistical Supplement are included as Exhibits 99.1 and 99.2 to this report.
Item 7.01. | Regulation FD Disclosure |
The press release referenced in Item 2.02, above, included certain predictions as to the Company’s performance for the year ending December 31, 2014.
Item 9.01. Financial Statements and Exhibits.
(a) | Not Applicable. |
(b) | Not Applicable. |
(c) | Not Applicable. |
(d) | Exhibits. |
Exhibit No. Description
99.1 Press Release dated February 3, 2014
99.2 Quarterly Financial and Statistical Supplement
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, hereunto duly authorized.
BANKFINANCIAL CORPORATION | |||||
Dated: | February 3, 2014 | By: | /s/ F. Morgan Gasior | ||
F. Morgan Gasior | |||||
Chairman of the Board and Chief Executive Officer | |||||
EXHIBIT INDEX
Exhibit No. Description
99.1 Press Release dated February 3, 2014
99.2 Quarterly Financial and Statistical Supplement
Exhibit 99.1
FOR IMMEDIATE RELEASE
BANKFINANCIAL CORPORATION ANNOUNCES FOURTH QUARTER 2013 FINANCIAL RESULTS
Burr Ridge, Illinois - February 3, 2014 (GLOBE NEWSWIRE) -- BankFinancial Corporation (BFIN) (the “Company”) filed its Quarterly Financial and Statistical Supplement on Form 8-K with the U.S. Securities and Exchange Commission (the "SEC") today.
BankFinancial recorded net income of $3.3 million and earnings per share of common stock of $0.16 for the year ended December 31, 2013. The Company recorded net income of $1.5 million, or $0.07 earnings per common share, for the fourth quarter of 2013.
For the fourth quarter of 2013, the Company’s net interest income before provision for loan losses increased to $11.5 million due to stronger loan originations and improved asset quality. For 2014, the Company believes that net interest income before provision for loan losses should range from $46 million and $49 million, with a quarterly target level of approximately $12.5 million to $13 million. Non-interest income declined modestly due to lower deposit service fees and income from bank-owned life insurance. Based on planned changes in loan, lease and deposit product pricing, as well as stronger performance in insurance and non-deposit product sales, the Company believes that non-interest income for the year ending December 31, 2014 should range between $6.8 million and $7.2 million, with a quarterly target level of approximately $1.8 million to $1.9 million. Non-interest expense rose by $432,000 to $12.8 million due to higher expenses for loan and lease origination, loan underwriting and marketing expenses related to loan and lease origination, which was partially offset by lower non-performing asset expenses. Office occupancy and equipment expense included approximately $100,000 in costs associated with the consolidation of the Hyde Park East branch, as well as $97,000 in snow removal costs. For 2014, the Company believes that core non-interest expenses should approximate $42 million, reaching an average quarterly core non-interest expense level of approximately $10 million by the third quarter of 2014.
The Company’s asset quality metrics continued to improve during the fourth quarter of 2013. At December 31, 2013 the Company’s ratio of non-performing loans to total loans was 1.66%. The ratio of classified assets to Bank Tier 1 Capital plus loan loss reserves was 29.6% as of December 31, 2013. Based on current information and trends, the Company expects that non-performing loan to total loans ratio should decline below 1.00% by the end of the third quarter of 2014. Total non-performing asset expense was $4.3 million in 2013; the Company also expects that non-performing asset expense should decline by as much as 50% during 2014 as the Company approaches its asset quality targets.
The Company’s Tangible Capital ratio was 11.93% as of December 31, 2013. The Company’s Tier 1 Risk-Based Capital ratio was 16.03%, reflecting the Company’s loan growth during the fourth quarter of 2013.
The Company’s liquidity and core deposit balances remained strong with total liquid funds available of $160 million and core deposits of $977.1 million as of December 31, 2013. The Company’s core deposit ratio was 78.0% at December 31, 2013.
The Company expects to release its schedule for the filing of its Form 10-K and anticipated investor conference call by March 15, 2014. The Company also expects to participate in one or more investor conferences in 2014 and will announce events and dates during the course of 2014 as plans are finalized. The Quarterly Financial and Statistical Supplement will be available today on BankFinancial's website, www.bankfinancial.com on the “Stockholder Information” page, and through the EDGAR database on the SEC's website, www.sec.gov. The Quarterly Financial and Statistical Supplement include comparative GAAP and non-GAAP performance data and financial measures for the most recent five quarters.
BankFinancial Corporation is the holding company for BankFinancial, F.S.B., a full-service, community-oriented bank providing financial services to individuals, families and businesses through 19 full-service banking offices,
located in Cook, DuPage, Lake and Will Counties, Illinois. BankFinancial Corporation's common stock trades on the Nasdaq Global Select Market under the symbol BFIN. Additional information may be found at the company's website, www.bankfinancial.com.
This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, which involve significant risks and uncertainties. Forward-looking statements may include statements relating to our future plans, strategies and expectations, as well as our future revenues, expenses, earnings, losses, financial performance, financial condition, asset quality metrics and future prospects. Forward looking statements are generally identifiable by use of the words “believe,” “may,” “will,” “should,” “could,” “expect,” “estimate,” “intend,” “anticipate,” “project,” “plan,” or similar expressions. Forward looking statements are frequently based on assumptions that may or may not materialize, and are subject to numerous uncertainties that could cause actual results to differ materially from those anticipated in the forward looking statements. We intend all forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for the purpose of invoking these safe harbor provisions.
Factors that could cause actual results to differ materially from the results anticipated or projected and which could materially and adversely affect our operating results, financial condition or future prospects include, but are not limited to: (i) less than anticipated loan growth due to intense competition for high quality loans and leases, particularly in terms of pricing and credit underwriting, or a dearth of borrowers who meet our underwriting standards; (ii) the impact of re-pricing and competitors’ pricing initiatives on loan and deposit products; (iii) adverse economic conditions in general and in the Chicago metropolitan area in particular, including high or increasing unemployment levels, that could result in increased delinquencies in our loan portfolio or a decline in the value of our investment securities and the collateral for our loans; (iv) declines in real estate values that adversely impact the value of our loan collateral, OREO; asset dispositions and the level of borrower equity in their investments; (v) borrowers that experience legal or financial difficulties that we do not currently foresee; (vi) results of supervisory monitoring or examinations by regulatory authorities, including the possibility that a regulatory authority could, among other things, require us to increase our allowance for loan losses or adversely change our loan classifications, write-down assets, reduce credit concentrations or maintain specific capital levels; (vii) interest rate movements and their impact on the economy, customer behavior and our net interest margin; (viii) changes, disruptions or illiquidity in national or global financial markets; (ix) the credit risks of lending activities, including risks that could cause changes in the level and direction of loan delinquencies and charge-offs or changes in estimates relating to the computation of our allowance for loan losses; (x) monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board; (xi) factors affecting our ability to access deposits or cost-effective funding, and the impact of competitors' pricing initiatives on our deposit products; (xii) the impact of new legislation or regulatory changes, including the Dodd-Frank Act and Basel III, on our products, services, operations and operating expenses; (xiii) higher federal deposit insurance premiums; (xiv) higher than expected overhead, infrastructure and compliance costs; (xv) changes in accounting principles, policies or guidelines; and (xv) and our failure to achieve expected synergies and cost savings from acquisitions.
These risks and uncertainties, as well as the Risk Factors set forth in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012, should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Forward looking statements speak only as of the date they are made. We do not undertake any obligation to update any forward-looking statement in the future, or to reflect circumstances and events that occur after the date on which the forward-looking statement was made.
For Further Information Contact: | ||
Shareholder, Analyst and Investor Inquiries: | Media Inquiries: | |
Elizabeth A. Doolan Senior Vice President – Controller BankFinancial Corporation Telephone: 630-242-7151 | Gregg T. Adams Executive Vice President – Marketing & Sales BankFinancial, F.S.B. Telephone: 630-242-7234 | |
Exhibit 99.2
BANKFINANCIAL CORPORATION
FOURTH QUARTER 2013
QUARTERLY FINANCIAL AND STATISTICAL SUPPLEMENT
FOR THE LATEST FIVE QUARTERS
Note: Certain reclassifications have been made in the prior period’s financial statements and reflected in the Selected Quarterly Financial and Statistical Data tables to conform to the current period’s presentation.
The information and statistical data contained herein have been prepared by BankFinancial Corporation and have been derived or calculated from selected quarterly and period–end historical financial statements prepared in accordance with accounting principles generally accepted in the United States. BankFinancial Corporation is under no obligation to update, keep current, or continue to provide the information contained herein. This information is provided solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or establish any business relationships with BankFinancial Corporation or its subsidiary.
BANKFINANCIAL CORPORATION
SELECTED QUARTERLY FINANCIAL AND STATISTICAL DATA
Latest Five Quarters
(Dollars in thousands; except per share) – (Unaudited)
2013 | 2012 | ||||||||||||||||||
IVQ | IIIQ | IIQ | IQ | IVQ | |||||||||||||||
PERFORMANCE MEASUREMENTS | |||||||||||||||||||
Return on assets (ratio of net income (loss) to average total assets) (1) | 0.42 | % | 0.29 | % | 0.02 | % | 0.19 | % | (6.66 | )% | |||||||||
Return on equity (ratio of net income (loss) to average equity) (1) | 3.43 | 2.38 | 0.17 | 1.55 | (50.32 | ) | |||||||||||||
Net interest rate spread (1) | 3.25 | 3.21 | 3.25 | 3.39 | 3.51 | ||||||||||||||
Net interest margin (1) | 3.31 | 3.26 | 3.31 | 3.45 | 3.58 | ||||||||||||||
Efficiency ratio | 97.51 | 95.36 | 97.84 | 90.51 | 104.71 | ||||||||||||||
Noninterest expense to average total assets(1) | 3.53 | 3.43 | 3.51 | 3.65 | 4.10 | ||||||||||||||
Average interest–earning assets to average interest–bearing liabilities | 121.97 | 121.95 | 121.24 | 120.81 | 123.20 | ||||||||||||||
Number of full service offices | 20 | 20 | 20 | 20 | 20 | ||||||||||||||
Employees (full time equivalents) | 301 | 308 | 308 | 347 | 352 | ||||||||||||||
SUMMARY STATEMENT OF FINANCIAL CONDITION | |||||||||||||||||||
ASSETS | |||||||||||||||||||
Cash and due from other financial institutions | $ | 15,781 | $ | 18,068 | $ | 18,303 | $ | 17,742 | $ | 20,361 | |||||||||
Interest-bearing deposits in other financial institutions | 145,176 | 225,410 | 293,790 | 293,386 | 255,403 | ||||||||||||||
Securities, at fair value | 110,907 | 83,409 | 53,014 | 61,273 | 77,832 | ||||||||||||||
Loans held for sale | — | 15 | 276 | 55 | 2,166 | ||||||||||||||
Loans receivable, net | 1,098,077 | 1,035,331 | 1,012,316 | 1,004,404 | 1,030,465 | ||||||||||||||
Other real estate owned, net | 6,306 | 5,403 | 6,262 | 8,088 | 10,358 | ||||||||||||||
Stock in Federal Home Loan Bank, at cost | 6,068 | 6,068 | 6,068 | 7,566 | 8,412 | ||||||||||||||
Premises and equipment, net | 35,328 | 36,154 | 36,830 | 37,530 | 38,251 | ||||||||||||||
Intangible assets | 2,433 | 2,583 | 2,732 | 2,882 | 3,038 | ||||||||||||||
Bank owned life insurance | 21,958 | 21,881 | 21,797 | 21,715 | 21,645 | ||||||||||||||
FDIC prepaid expense | — | — | — | 2,188 | 2,658 | ||||||||||||||
Income tax receivable | — | — | — | — | 461 | ||||||||||||||
Other assets | 11,560 | 7,626 | 9,744 | 9,306 | 10,142 | ||||||||||||||
Total assets | $ | 1,453,594 | $ | 1,441,948 | $ | 1,461,132 | $ | 1,466,135 | $ | 1,481,192 | |||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||||
Deposits | $ | 1,252,708 | $ | 1,249,833 | $ | 1,262,096 | $ | 1,271,550 | $ | 1,282,351 | |||||||||
Borrowings | 3,055 | 2,883 | 2,940 | 2,740 | 5,567 | ||||||||||||||
Other liabilities | 22,204 | 14,921 | 22,867 | 18,206 | 20,384 | ||||||||||||||
Total liabilities | 1,277,967 | 1,267,637 | 1,287,903 | 1,292,496 | 1,308,302 | ||||||||||||||
Stockholders’ equity | 175,627 | 174,311 | 173,229 | 173,639 | 172,890 | ||||||||||||||
Total liabilities and stockholders’ equity | $ | 1,453,594 | $ | 1,441,948 | $ | 1,461,132 | $ | 1,466,135 | $ | 1,481,192 | |||||||||
(1)Annualized
Page 2
BANKFINANCIAL CORPORATION
SELECTED QUARTERLY FINANCIAL AND STATISTICAL DATA
Latest Five Quarters
(Dollars in thousands; except per share) – (Unaudited)
2013 | 2012 | ||||||||||||||||||
IVQ | IIIQ | IIQ | IQ | IVQ | |||||||||||||||
SUMMARY STATEMENT OF OPERATIONS | |||||||||||||||||||
Total interest income | $ | 12,296 | $ | 12,107 | $ | 12,276 | $ | 12,713 | $ | 13,801 | |||||||||
Total interest expense | 842 | 882 | 935 | 994 | 1,059 | ||||||||||||||
Net interest income before provision | 11,454 | 11,225 | 11,341 | 11,719 | 12,742 | ||||||||||||||
Provision (recovery) for loan losses | (1,178 | ) | (437 | ) | 206 | 722 | 24,328 | ||||||||||||
Net interest income | 12,632 | 11,662 | 11,135 | 10,997 | (11,586 | ) | |||||||||||||
Noninterest income | 1,665 | 1,737 | 1,703 | 3,029 | 1,984 | ||||||||||||||
Noninterest expense | 12,792 | 12,360 | 12,762 | 13,348 | 15,420 | ||||||||||||||
Income (loss) before income tax | 1,505 | 1,039 | 76 | 678 | (25,022 | ) | |||||||||||||
Income tax expense (benefit) | — | — | — | — | — | ||||||||||||||
Net income (loss) | $ | 1,505 | $ | 1,039 | $ | 76 | $ | 678 | $ | (25,022 | ) | ||||||||
Basic earnings (loss) per common share | $ | 0.07 | $ | 0.05 | $ | — | $ | 0.03 | $ | (1.25 | ) | ||||||||
Diluted earnings (loss) per common share | $ | 0.07 | $ | 0.05 | $ | — | $ | 0.03 | $ | (1.25 | ) | ||||||||
NONINTEREST INCOME AND EXPENSE | |||||||||||||||||||
Noninterest Income | |||||||||||||||||||
Deposit service charges and fees | $ | 477 | $ | 520 | $ | 509 | $ | 499 | $ | 550 | |||||||||
Other fee income | 537 | 571 | 604 | 538 | 593 | ||||||||||||||
Insurance commissions and annuities income | 173 | 106 | 86 | 109 | 151 | ||||||||||||||
Gain (loss) on sales of loans, net | 24 | 32 | (4 | ) | 1,417 | 246 | |||||||||||||
Gain (loss) on disposition of premises and equipment | (43 | ) | — | — | — | 8 | |||||||||||||
Loan servicing fees | 112 | 112 | 114 | 123 | 115 | ||||||||||||||
Amortization of servicing assets | (40 | ) | (49 | ) | (85 | ) | (59 | ) | (68 | ) | |||||||||
Recovery (impairment) of servicing assets | 24 | 6 | 9 | 26 | (17 | ) | |||||||||||||
Earnings on bank owned life insurance | 77 | 84 | 82 | 70 | 83 | ||||||||||||||
Trust income | 175 | 172 | 183 | 181 | 188 | ||||||||||||||
Other | 149 | 183 | 205 | 125 | 135 | ||||||||||||||
Total noninterest income | $ | 1,665 | $ | 1,737 | $ | 1,703 | $ | 3,029 | $ | 1,984 | |||||||||
Noninterest Expense | |||||||||||||||||||
Compensation and benefits | $ | 6,614 | $ | 6,143 | $ | 6,686 | $ | 6,752 | $ | 6,278 | |||||||||
Office occupancy and equipment | 1,997 | 1,797 | 1,805 | 1,948 | 2,019 | ||||||||||||||
Advertising and public relations | 316 | 195 | 268 | 146 | 258 | ||||||||||||||
Information technology | 697 | 817 | 816 | 749 | 813 | ||||||||||||||
Supplies, telephone, and postage | 463 | 382 | 403 | 461 | 413 | ||||||||||||||
Amortization of intangibles | 150 | 149 | 150 | 156 | 156 | ||||||||||||||
Nonperforming asset management | 607 | 682 | 655 | 694 | 1,126 | ||||||||||||||
Loss (gain) on sales of other real estate owned | (34 | ) | 64 | 49 | 69 | 379 | |||||||||||||
Valuation adjustments of other real estate owned | 79 | 241 | 141 | 89 | 1,783 | ||||||||||||||
Operations of other real estate owned | 159 | 171 | 232 | 353 | 344 | ||||||||||||||
FDIC insurance premiums | 468 | 476 | 477 | 492 | 480 | ||||||||||||||
Other | 1,276 | 1,243 | 1,080 | 1,439 | 1,371 | ||||||||||||||
Total noninterest expense | $ | 12,792 | $ | 12,360 | $ | 12,762 | $ | 13,348 | $ | 15,420 | |||||||||
Page 3
BANKFINANCIAL CORPORATION
SELECTED QUARTERLY FINANCIAL AND STATISTICAL DATA
Latest Five Quarters
(Dollars in thousands; except per share) – (Unaudited)
2013 | 2012 | ||||||||||||||||||
IVQ | IIIQ | IIQ | IQ | IVQ | |||||||||||||||
LOANS | |||||||||||||||||||
One–to–four family residential real estate loans | $ | 201,382 | $ | 204,205 | $ | 200,181 | $ | 209,540 | $ | 218,596 | |||||||||
Multi–family mortgage loans | 396,058 | 375,786 | 353,924 | 338,502 | 352,019 | ||||||||||||||
Nonresidential real estate loans | 263,567 | 246,524 | 255,429 | 261,207 | 264,672 | ||||||||||||||
Construction and land loans | 6,570 | 6,429 | 7,152 | 6,933 | 8,552 | ||||||||||||||
Commercial loans | 54,255 | 52,978 | 51,701 | 55,362 | 61,388 | ||||||||||||||
Commercial leases | 187,112 | 161,822 | 157,606 | 147,168 | 139,783 | ||||||||||||||
Consumer loans | 2,317 | 2,561 | 2,622 | 2,414 | 2,745 | ||||||||||||||
1,111,261 | 1,050,305 | 1,028,615 | 1,021,126 | 1,047,755 | |||||||||||||||
Net deferred loan origination costs | 970 | 902 | 798 | 731 | 745 | ||||||||||||||
Allowance for loan losses | (14,154 | ) | (15,876 | ) | (17,097 | ) | (17,453 | ) | (18,035 | ) | |||||||||
Loans, net | $ | 1,098,077 | $ | 1,035,331 | $ | 1,012,316 | $ | 1,004,404 | $ | 1,030,465 | |||||||||
LOAN ORIGINATIONS (1) | |||||||||||||||||||
One–to–four family residential real estate loans | $ | 6,316 | $ | 13,425 | $ | 3,670 | $ | 4,601 | $ | 3,864 | |||||||||
Multi–family mortgage loans | 37,351 | 46,675 | 28,606 | 6,308 | 3,453 | ||||||||||||||
Nonresidential real estate loans | 26,009 | 4,185 | 6,017 | 9,298 | 10,464 | ||||||||||||||
Construction and land loans | 1,118 | 1,015 | 366 | 55 | — | ||||||||||||||
Commercial loans | 56,222 | 44,811 | 43,735 | 45,719 | 42,352 | ||||||||||||||
Commercial leases | 47,101 | 27,192 | 30,854 | 30,047 | 37,893 | ||||||||||||||
Consumer loans | 962 | 970 | 1,090 | 874 | 1,262 | ||||||||||||||
$ | 175,079 | $ | 138,273 | $ | 114,338 | $ | 96,902 | $ | 99,288 | ||||||||||
LOAN PAYMENTS and PAYOFFS (2) | |||||||||||||||||||
One–to–four family residential real estate loans | $ | 8,749 | $ | 9,012 | $ | 10,934 | $ | 13,146 | $ | 14,102 | |||||||||
Multi–family mortgage loans | 13,966 | 23,678 | 16,035 | 19,683 | 19,366 | ||||||||||||||
Nonresidential real estate loans | 9,673 | 14,042 | 9,853 | 12,163 | 20,874 | ||||||||||||||
Construction and land loans | 979 | 1,376 | 140 | 742 | 1,435 | ||||||||||||||
Commercial loans | 54,744 | 43,760 | 46,851 | 51,801 | 40,864 | ||||||||||||||
Commercial leases | 19,480 | 23,402 | 20,448 | 24,711 | 17,194 | ||||||||||||||
Consumer loans | 951 | 1,036 | 912 | 886 | 1,024 | ||||||||||||||
$ | 108,542 | $ | 116,306 | $ | 105,173 | $ | 123,132 | $ | 114,859 | ||||||||||
LOAN PAYMENTS and PAYOFFS (Loans rated 5 or higher) (2) | |||||||||||||||||||
One–to–four family residential real estate loans | $ | 1,022 | $ | 932 | $ | 2,481 | $ | 1,151 | $ | 2,873 | |||||||||
Multi–family mortgage loans | 1,651 | 13,311 | 7,912 | 4,058 | 7,291 | ||||||||||||||
Nonresidential real estate loans | 3,055 | 9,659 | 7,803 | 4,698 | 10,930 | ||||||||||||||
Construction and land loans | 926 | 1,303 | 90 | 692 | 1,345 | ||||||||||||||
Commercial loans | 6,262 | 4,079 | 3,366 | 6,829 | 7,720 | ||||||||||||||
Commercial leases | 35 | 26 | 30 | 30 | 32 | ||||||||||||||
Consumer loans | — | — | — | 2 | 9 | ||||||||||||||
$ | 12,951 | $ | 29,310 | $ | 21,682 | $ | 17,460 | $ | 30,200 | ||||||||||
(1) Loan originations include draws on revolving lines of credit and exclude loan renewals.
(2) Loan payments and payoffs exclude loan renewals.
Page 4
BANKFINANCIAL CORPORATION
SELECTED QUARTERLY FINANCIAL AND STATISTICAL DATA
Latest Five Quarters
(Dollars in thousands; except per share) – (Unaudited)
2013 | 2012 | ||||||||||||||||||
IVQ | IIIQ | IIQ | IQ | IVQ | |||||||||||||||
CREDIT QUALITY: | |||||||||||||||||||
Nonperforming Assets: | |||||||||||||||||||
Nonaccrual loans: | |||||||||||||||||||
One–to–four family residential real estate loans | $ | 4,641 | $ | 5,398 | $ | 5,399 | $ | 5,988 | $ | 7,299 | |||||||||
Multi–family mortgage loans | 7,098 | 11,913 | 12,204 | 10,822 | 3,517 | ||||||||||||||
Nonresidential real estate loans | 4,214 | 5,335 | 7,037 | 6,182 | 8,985 | ||||||||||||||
Construction and land loans | 382 | 1,018 | 1,601 | 1,575 | 2,210 | ||||||||||||||
Commercial loans | 77 | 272 | 689 | 883 | 256 | ||||||||||||||
Commercial leases | — | — | — | — | — | ||||||||||||||
Consumer loans | 12 | 2 | 1 | 11 | — | ||||||||||||||
Nonaccrual loans | 16,424 | 23,938 | 26,931 | 25,461 | 22,267 | ||||||||||||||
Loans past due over 90 days, still accruing | 228 | 965 | 234 | 243 | 329 | ||||||||||||||
Loans held for sale | — | 15 | 15 | 15 | 1,752 | ||||||||||||||
Other real estate owned: | |||||||||||||||||||
One–to–four family residential real estate loans | 901 | 808 | 1,316 | 1,515 | 1,760 | ||||||||||||||
Multi–family real estate | 1,921 | 195 | — | — | 720 | ||||||||||||||
Nonresidential real estate | 1,181 | 1,047 | 1,757 | 2,896 | 3,504 | ||||||||||||||
Land | 275 | 919 | 933 | 1,144 | 1,323 | ||||||||||||||
Other real estate owned | 4,278 | 2,969 | 4,006 | 5,555 | 7,307 | ||||||||||||||
Nonperforming assets (excluding purchase impaired loans and purchased other real estate owned) | 20,930 | 27,887 | 31,186 | 31,274 | 31,655 | ||||||||||||||
Purchased impaired loans: | |||||||||||||||||||
One–to–four family residential real estate loans | $ | 100 | $ | 405 | $ | 396 | $ | 388 | $ | 380 | |||||||||
Nonresidential real estate loans | 1,633 | 1,611 | 1,607 | 2,554 | 2,568 | ||||||||||||||
Construction and land loans | — | — | 997 | 1,021 | 1,021 | ||||||||||||||
Commercial loans | 23 | 22 | 21 | 21 | 20 | ||||||||||||||
Purchased impaired loans | 1,756 | 2,038 | 3,021 | 3,984 | 3,989 | ||||||||||||||
Purchased other real estate owned: | |||||||||||||||||||
One–to–four family residential real estate | 176 | 201 | 179 | 205 | 320 | ||||||||||||||
Nonresidential real estate | — | 372 | 372 | 372 | 462 | ||||||||||||||
Land | 1,852 | 1,861 | 1,705 | 1,956 | 2,269 | ||||||||||||||
Purchased other real estate owned | 2,028 | 2,434 | 2,256 | 2,533 | 3,051 | ||||||||||||||
Purchased impaired loans and OREO | 3,784 | 4,472 | 5,277 | 6,517 | 7,040 | ||||||||||||||
Nonperforming assets | $ | 24,714 | $ | 32,359 | $ | 36,463 | $ | 37,791 | $ | 38,695 | |||||||||
Asset Quality Ratios | |||||||||||||||||||
Nonperforming assets to total assets | 1.70 | % | 2.24 | % | 2.50 | % | 2.58 | % | 2.61 | % | |||||||||
Nonperforming assets to total assets (1) | 1.44 | 1.93 | 2.13 | 2.13 | 2.14 | ||||||||||||||
Nonperforming loans to total loans | 1.66 | 2.57 | 2.94 | 2.91 | 2.70 | ||||||||||||||
Nonperforming loans to total loans (1) | 1.50 | 2.37 | 2.64 | 2.52 | 2.32 | ||||||||||||||
Allowance for loan losses to nonperforming loans | 76.89 | 58.90 | 56.61 | 58.76 | 63.64 | ||||||||||||||
Allowance for loan losses to nonperforming loans(1) | 85.00 | 63.71 | 62.90 | 67.86 | 74.07 | ||||||||||||||
(1) | Asset quality ratios exclude purchased impaired loans and acquired other real estate owned resulting from the Downers Grove National Bank merger. |
Page 5
BANKFINANCIAL CORPORATION
SELECTED QUARTERLY FINANCIAL AND STATISTICAL DATA
Latest Five Quarters
(Dollars in thousands; except per share) – (Unaudited)
2013 | 2012 | ||||||||||||||||||
IVQ | IIIQ | IIQ | IQ | IVQ | |||||||||||||||
SUBSTANDARD PERFORMING LOANS | |||||||||||||||||||
One–to–four family residential real estate loans | $ | 2,634 | $ | 1,597 | $ | 1,546 | $ | 2,983 | $ | 4,868 | |||||||||
Multi–family mortgage loans | 5,063 | 7,028 | 10,476 | 13,935 | 22,909 | ||||||||||||||
Nonresidential real estate loans | 13,645 | 15,427 | 16,185 | 17,176 | 22,345 | ||||||||||||||
Construction and land loans | 832 | 1,062 | 1,628 | 1,707 | 2,394 | ||||||||||||||
Commercial loans | 977 | 1,061 | 1,083 | 1,817 | 2,485 | ||||||||||||||
Commercial leases | 210 | — | — | — | — | ||||||||||||||
Consumer loans | 1 | — | — | — | 3 | ||||||||||||||
$ | 23,362 | $ | 26,175 | $ | 30,918 | $ | 37,618 | $ | 55,004 | ||||||||||
PERFORMING LOANS GREATER THAN 30 DAYS PAST DUE | |||||||||||||||||||
30 – 59 days past due | $ | 5,574 | $ | 1,706 | $ | 2,001 | $ | 4,539 | $ | 8,100 | |||||||||
60 – 89 days past due | 1,535 | 1,268 | 268 | 425 | 2,652 | ||||||||||||||
Matured Loans | 3,458 | 2,740 | 1,839 | 2,670 | 3,550 | ||||||||||||||
$ | 10,567 | $ | 5,714 | $ | 4,108 | $ | 7,634 | $ | 14,302 | ||||||||||
ALLOWANCE FOR LOAN LOSSES | |||||||||||||||||||
Beginning balance | $ | 15,876 | $ | 17,097 | $ | 17,453 | $ | 18,035 | $ | 20,588 | |||||||||
Charge offs: | |||||||||||||||||||
One–to–four family residential real estate loans | (432 | ) | (528 | ) | (176 | ) | (369 | ) | (7,958 | ) | |||||||||
Multi–family mortgage loans | (320 | ) | (902 | ) | (374 | ) | (236 | ) | (4,355 | ) | |||||||||
Nonresidential real estate loans | (207 | ) | (138 | ) | (153 | ) | (79 | ) | (10,097 | ) | |||||||||
Construction and land loans | — | (16 | ) | — | (927 | ) | (3,273 | ) | |||||||||||
Commercial loans | (62 | ) | (131 | ) | (213 | ) | (19 | ) | (1,255 | ) | |||||||||
Commercial leases | — | — | — | — | (53 | ) | |||||||||||||
Consumer loans | (5 | ) | (38 | ) | (12 | ) | — | (8 | ) | ||||||||||
(1,026 | ) | (1,753 | ) | (928 | ) | (1,630 | ) | (26,999 | ) | ||||||||||
Recoveries: | |||||||||||||||||||
One–to–four family residential real estate loans | 12 | 108 | 85 | 242 | 41 | ||||||||||||||
Multi–family mortgage loans | 17 | 3 | 159 | 57 | 48 | ||||||||||||||
Nonresidential real estate loans | 68 | 329 | 103 | 19 | 6 | ||||||||||||||
Construction and land loans | 267 | 193 | 1 | 2 | 2 | ||||||||||||||
Commercial loans | 114 | 335 | 16 | 5 | 16 | ||||||||||||||
Consumer loans | 4 | 1 | 2 | 1 | 5 | ||||||||||||||
482 | 969 | 366 | 326 | 118 | |||||||||||||||
Net charge–offs | (544 | ) | (784 | ) | (562 | ) | (1,304 | ) | (26,881 | ) | |||||||||
Provision for (recovery of) loan losses | (1,178 | ) | (437 | ) | 206 | 722 | 24,328 | ||||||||||||
Ending balance | $ | 14,154 | $ | 15,876 | $ | 17,097 | $ | 17,453 | $ | 18,035 | |||||||||
Allowance for loan losses to total loans | 1.27 | % | 1.51 | % | 1.66 | % | 1.71 | % | 1.72 | % | |||||||||
Net charge–off ratio (1) | 0.20 | 0.31 | 0.22 | 0.51 | 9.97 | ||||||||||||||
(1) | Annualized |
Page 6
BANKFINANCIAL CORPORATION
SELECTED QUARTERLY FINANCIAL AND STATISTICAL DATA
Latest Five Quarters
(Dollars in thousands; except per share) – (Unaudited)
2013 | 2012 | ||||||||||||||||||
IVQ | IIIQ | IIQ | IQ | IVQ | |||||||||||||||
DEPOSITS | |||||||||||||||||||
Noninterest–bearing demand | $ | 126,680 | $ | 133,094 | $ | 137,146 | $ | 131,856 | $ | 134,597 | |||||||||
Savings deposits | 149,602 | 146,685 | 147,758 | 148,184 | 144,726 | ||||||||||||||
Money market accounts | 347,017 | 341,175 | 340,243 | 345,591 | 349,092 | ||||||||||||||
Interest–bearing NOW accounts | 353,787 | 349,622 | 349,942 | 348,059 | 348,683 | ||||||||||||||
Certificates of deposits | 275,622 | 279,257 | 287,007 | 297,860 | 305,253 | ||||||||||||||
$ | 1,252,708 | $ | 1,249,833 | $ | 1,262,096 | $ | 1,271,550 | $ | 1,282,351 | ||||||||||
SELECTED AVERAGE BALANCES | |||||||||||||||||||
Total average assets | $ | 1,450,403 | $ | 1,440,561 | $ | 1,453,413 | $ | 1,462,119 | $ | 1,503,759 | |||||||||
Total average interest–earning assets | 1,374,544 | 1,364,625 | 1,373,855 | 1,379,156 | 1,416,629 | ||||||||||||||
Average loans | 1,061,829 | 1,019,402 | 1,014,591 | 1,028,907 | 1,078,708 | ||||||||||||||
Average securities | 92,223 | 68,109 | 57,022 | 73,284 | 80,485 | ||||||||||||||
Average stock in FHLB | 6,068 | 6,068 | 6,809 | 8,026 | 8,761 | ||||||||||||||
Average other interest–earning assets | 214,424 | 271,046 | 295,433 | 268,939 | 248,675 | ||||||||||||||
Total average interest–bearing liabilities | 1,126,973 | 1,118,967 | 1,133,159 | 1,141,625 | 1,149,888 | ||||||||||||||
Average interest–bearing deposits | 1,123,977 | 1,116,154 | 1,130,294 | 1,138,438 | 1,143,586 | ||||||||||||||
Average borrowings | 2,996 | 2,813 | 2,865 | 3,187 | 6,302 | ||||||||||||||
Average stockholders’ equity | 175,305 | 174,790 | 174,643 | 174,766 | 198,908 | ||||||||||||||
SELECTED YIELDS AND COST OF FUNDS (1): | |||||||||||||||||||
Total average interest–earning assets | 3.55 | % | 3.52 | % | 3.58 | % | 3.74 | % | 3.88 | % | |||||||||
Average loans | 4.44 | 4.55 | 4.69 | 4.84 | 4.91 | ||||||||||||||
Average securities | 1.17 | 1.40 | 1.54 | 1.39 | 1.55 | ||||||||||||||
Average other interest–earning assets | 0.26 | 0.27 | 0.27 | 0.27 | 0.27 | ||||||||||||||
Total average interest–bearing liabilities | 0.30 | 0.31 | 0.33 | 0.35 | 0.37 | ||||||||||||||
Average interest–bearing deposits | 0.30 | 0.31 | 0.33 | 0.35 | 0.36 | ||||||||||||||
Average borrowings | 0.26 | 0.28 | 0.28 | 1.02 | 1.52 | ||||||||||||||
Net interest rate spread | 3.25 | 3.21 | 3.25 | 3.39 | 3.51 | ||||||||||||||
Net interest margin | 3.31 | 3.26 | 3.31 | 3.45 | 3.58 | ||||||||||||||
Page 7
BANKFINANCIAL CORPORATION
SELECTED QUARTERLY FINANCIAL AND STATISTICAL DATA
Latest Five Quarters
(Dollars in thousands; except per share) – (Unaudited)
2013 | 2012 | ||||||||||||||||||
IVQ | IIIQ | IIQ | IQ | IVQ | |||||||||||||||
CAPITAL RATIOS | |||||||||||||||||||
BankFinancial Corporation | |||||||||||||||||||
Equity to total assets (end of period) | 12.08 | % | 12.09 | % | 11.86 | % | 11.84 | % | 11.67 | % | |||||||||
Tangible equity to tangible total assets (end of period) | 11.93 | 11.93 | 11.69 | 11.67 | 11.49 | ||||||||||||||
Risk–based total capital ratio | 17.28 | 18.15 | 18.38 | 18.59 | 18.01 | ||||||||||||||
Risk–based tier 1 capital ratio | 16.03 | 16.90 | 17.12 | 17.33 | 16.75 | ||||||||||||||
Tier 1 leverage ratio | 11.92 | 11.91 | 11.66 | 11.62 | 11.43 | ||||||||||||||
Tier 1 capital | $ | 172,775 | $ | 171,269 | $ | 169,823 | $ | 169,763 | $ | 168,734 | |||||||||
BankFinancial FSB | |||||||||||||||||||
Risk–based total capital ratio | 14.93 | % | 15.58 | % | 15.74 | % | 15.84 | % | 15.32 | % | |||||||||
Risk–based tier 1 capital ratio | 13.68 | 14.33 | 14.48 | 14.59 | 14.07 | ||||||||||||||
Tier 1 leverage ratio | 10.16 | 10.10 | 9.86 | 9.77 | 9.60 | ||||||||||||||
Tier 1 capital | $ | 147,363 | $ | 145,203 | $ | 143,589 | $ | 142,861 | $ | 141,629 | |||||||||
COMMON STOCK AND DIVIDENDS | |||||||||||||||||||
Stock Prices: | |||||||||||||||||||
Close | $ | 9.16 | $ | 8.84 | $ | 8.50 | $ | 8.09 | $ | 7.42 | |||||||||
High | 9.74 | 9.40 | 8.71 | 8.40 | 8.85 | ||||||||||||||
Low | 8.70 | 8.15 | 7.25 | 7.19 | 6.62 | ||||||||||||||
Book value per share | $ | 8.32 | $ | 8.26 | $ | 8.21 | $ | 8.24 | $ | 8.20 | |||||||||
Tangible book value per share | $ | 8.21 | $ | 8.14 | $ | 8.08 | $ | 8.10 | $ | 8.06 | |||||||||
Cash dividends declared on common stock | $ | 0.02 | $ | — | $ | 0.02 | $ | — | $ | — | |||||||||
Stock repurchases | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||
Stock repurchases – shares | — | — | — | — | — | ||||||||||||||
EARNINGS PER SHARE COMPUTATIONS | |||||||||||||||||||
Net income (loss) | $ | 1,505 | $ | 1,039 | $ | 76 | $ | 678 | $ | (25,022 | ) | ||||||||
Average common shares outstanding | 21,101,966 | 21,101,966 | 21,088,263 | 21,072,966 | 21,072,966 | ||||||||||||||
Less: Unearned ESOP shares | (1,002,041 | ) | (1,028,158 | ) | (1,084,709 | ) | (1,108,938 | ) | (1,133,374 | ) | |||||||||
Unvested restricted stock shares | (25,750 | ) | (25,750 | ) | (13,797 | ) | — | — | |||||||||||
Weighted average common shares outstanding | 20,074,175 | 20,048,058 | 19,989,757 | 19,964,028 | 19,939,592 | ||||||||||||||
Plus: Dilutive common shares equivalents | 9,500 | 6,034 | 556 | — | — | ||||||||||||||
Weighted average dilutive common shares outstanding | 20,083,675 | 20,054,092 | 19,990,313 | 19,964,028 | 19,939,592 | ||||||||||||||
Basic earnings (loss) per common share | $ | 0.07 | $ | 0.05 | $ | — | $ | 0.03 | $ | (1.25 | ) | ||||||||
Diluted earnings (loss) per common share | $ | 0.07 | $ | 0.05 | $ | — | $ | 0.03 | $ | (1.25 | ) | ||||||||
Page 8
BANKFINANCIAL CORPORATION
NON–GAAP FINANCIAL MEASURES
BankFinancial Corporation, a Maryland corporation (“the Company”) utilizes a number of different financial measures, both GAAP and non–GAAP, in making operating, budgeting and planning decisions for future periods. Generally, a non–GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles in the United States, or GAAP. The Company believes that the use of the non–GAAP financial measures described below provides the Board of Directors and management, and may provide some investors, with a more complete understanding of the Company’s operating results and trends, and facilitate comparisons to historical and peer performance. The Company’s non–GAAP financial measures should be considered supplemental in nature and should not be considered in isolation, or as superior to or a substitute for, financial measures that are prepared in accordance with GAAP. In addition, the Company’s non–GAAP financial measures may differ from similar non–GAAP financial measures that are used by other companies, thus limiting their usefulness as a comparative tool.
These measures include pre–tax pre–provision earnings from core operations and pre–tax pre–provision earnings from core operations to average total assets. Management believes that by excluding gain on sale of owner-occupied and investor-owned one-to-four family residential loans that we designated as held for sale from noninterest income, and other real estate owned related income and expense items and nonperforming asset management expenses from noninterest expense, these measures better reflect our core operating performance.
Page 9
BANKFINANCIAL CORPORATION
NON-GAAP FINANCIAL MEASURES
(Dollars in thousands, except per share) - (Unaudited)
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Pre–tax pre–provision earnings from core operations | |||||||||||||||
Income (loss) before income taxes | $ | 1,505 | $ | (25,022 | ) | $ | 3,298 | $ | (27,109 | ) | |||||
Provision for (recovery of) loan losses | (1,178 | ) | 24,328 | (687 | ) | 31,522 | |||||||||
327 | (694 | ) | 2,611 | 4,413 | |||||||||||
Adjustments: | |||||||||||||||
Gain on sale of owner-occupied and investor-owned one-to-four family residential loans designated as held for sale | — | — | (1,340 | ) | — | ||||||||||
Nonperforming asset management | 607 | 1,126 | 2,638 | 5,211 | |||||||||||
Loss (gain) on sale of other real estate owned | (34 | ) | 379 | 148 | 252 | ||||||||||
Valuation adjustments of other real estate owned | 79 | 1,783 | 550 | 5,560 | |||||||||||
Operations of other real estate owned | 159 | 344 | 915 | 1,679 | |||||||||||
Adjustments | 811 | 3,632 | 2,911 | 12,702 | |||||||||||
Pre–tax pre–provision earnings from core operations | $ | 1,138 | $ | 2,938 | $ | 5,522 | $ | 17,115 | |||||||
Pre–tax pre–provision earnings from core operations to average total assets (1) | 0.31 | % | 0.78 | % | 0.38 | % | 1.13 | % | |||||||
(1) | Annualized |
Page 10
BANKFINANCIAL CORPORATION
NON-GAAP FINANCIAL MEASURES
(Dollars in thousands, except per share) - (Unaudited)
FOR THE LATEST FIVE QUARTERS
2013 | 2012 | ||||||||||||||||||
IVQ | IIIQ | IIQ | IQ | IVQ | |||||||||||||||
Pre–tax pre–provision earnings from core operations | |||||||||||||||||||
Income (loss) before income taxes | $ | 1,505 | $ | 1,039 | $ | 76 | $ | 678 | $ | (25,022 | ) | ||||||||
Provision for (recovery of) loan losses | (1,178 | ) | (437 | ) | 206 | 722 | 24,328 | ||||||||||||
327 | 602 | 282 | 1,400 | (694 | ) | ||||||||||||||
Adjustments: | |||||||||||||||||||
Gain on sale of owner-occupied and investor-owned one-to-four family residential loans designated as held for sale | — | — | (40 | ) | (1,300 | ) | — | ||||||||||||
Nonperforming asset management | 607 | 682 | 655 | 694 | 1,126 | ||||||||||||||
Loss (gain) on sale of other real estate owned | (34 | ) | 64 | 49 | 69 | 379 | |||||||||||||
Valuation adjustments of other real estate owned | 79 | 241 | 141 | 89 | 1,783 | ||||||||||||||
Operations of other real estate owned | 159 | 171 | 232 | 353 | 344 | ||||||||||||||
811 | 1,158 | 1,037 | (95 | ) | 3,632 | ||||||||||||||
Pre–tax pre–provision earnings from core operations | $ | 1,138 | $ | 1,760 | $ | 1,319 | $ | 1,305 | $ | 2,938 | |||||||||
Pre–tax pre–provision earnings from core operations to average total assets (1) | 0.31 | % | 0.49 | % | 0.36 | % | 0.36 | % | 0.78 | % | |||||||||
(1) | Annualized |
Page 11