Wells Financial Corp. Announces First Quarter Results and Cash
Dividend WELLS, Minn., April 25 /PRNewswire-FirstCall/ -- Selected
Financial Data (Unaudited) Quarter ended Quarter ended 03/31/05
03/31/04 Net Income $521,000 $477,000 Basic earnings per share
$0.49 $0.41 Diluted earnings per share $0.48 $0.40 Return on
average equity 7.95% 6.80% Return on average assets 0.86% 0.85%
Book value per share $24.23 $24.33 Net interest rate spread 3.67%
3.59% Net interest rate margin 3.83% 3.76% Allowance for loan loss
to total loans 0.43% 0.51% Lonnie R. Trasamar, President of Wells
Financial Corp. (NASDAQ:WEFC) (the Company), the holding company of
Wells Federal Bank (the Bank), announced earnings for the first
quarter of 2005 of $521,000, up $44,000 or 9.2%, when compared to
the first quarter of 2004. Basic and diluted earnings per share for
the quarter were $0.49 and $0.48, respectively. This compares to
basic and diluted earnings per share for the first quarter of 2004
of $0.41 and $0.40, respectively. The increase in net income was
primarily due to an increase of $222,000 in net interest income
being partially offset by a $99,000 decrease in noninterest income
and a $35,000 increase in the provision for loan losses. The
increase in net interest income resulted from a $408,000 increase
in interest income being partially offset by a $186,000 in interest
expense. Total assets increased during the first quarter of 2005 by
$5,952,000 from $239,395,000 at December 31, 2004 to $245,347,000
at March 31, 2005 due primarily to an increase of $5,240,000 in
loans receivable. The increase in loans receivable resulted
primarily from increases in commercial real estate loans,
agricultural real estate loans and home equity line of credit
loans. Liabilities increased by $7,388,000 during the first quarter
of 2005 from $212,805,000 at December 31, 2004 to $220,193,000 at
March 31, 2005 due primarily to a $6,000,000 increase in borrowed
funds. On April 19, 2005 the Company's Board of Directors declared
a $0.24 cash dividend payable on May 20, 2005 to shareholders of
record on May 6, 2005. Wells Financial Corp. and Wells Federal Bank
are headquartered in Wells, Minnesota. The Bank operates nine full
service offices located in Wells, Blue Earth, Mankato, Fairmont,
North Mankato, Albert Lea, St. Peter and Owatonna Minnesota and
Mason City, Iowa and a loan origination office located in
Farmington, Minnesota. The Bank is a community oriented, full
service savings bank offering traditional mortgage, consumer,
commercial and agricultural loan products. The Bank offers
insurance, mutual funds and variable rate annuity products through
its subsidiary, Wells Insurance Agency. Forward-looking Statements
Statements in this press release that are not strictly historical
may be "forward-looking" statements, which involve risks and
uncertainties. The foregoing material may contain forward-looking
statements concerning the financial condition, results of
operations and business of the Company. We caution that such
statements are subject to a number of uncertainties and actual
results could differ materially and, therefore, readers should not
place undue reliance on any forward-looking statements. The Company
does not undertake, and specifically disclaims, any obligation to
publicly release the results of any revisions that may be made to
any forward-looking statements to reflect the occurrence of
anticipated or unanticipated events or circumstances arising after
the date hereof. WELLS FINANCIAL CORP. and SUBSIDIARY Consolidated
Statements of Financial Condition March 31, 2005 and December 31,
2004 (Dollars in Thousands) (Unaudited) ASSETS 2005 2004 Cash,
including interest-bearing accounts March 31, 2005 $3,068; December
31, 2004 $1,383 $8,153 $5,605 Certificates of deposit 200 100
Securities available for sale, at fair value 12,873 13,945 Federal
Home Loan Bank Stock, at cost 2,424 2,133 Loans held for sale 2,194
3,454 Loans receivable, net 210,902 205,662 Accrued interest
receivable 1,433 1,533 Premises and equipment, net 4,304 4,212
Mortgage servicing rights, net 2,412 2,515 Other assets 452 236
TOTAL ASSETS $245,347 $239,395 LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES Deposits $167,673 $167,495 Borrowed funds 47,640 41,640
Advances from borrowers for taxes and insurance 2,906 1,877
Deferred income taxes 1,248 1,494 Accrued interest payable 130 38
Accrued expenses and other liabilities 596 261 TOTAL LIABILITIES
220,193 212,805 STOCKHOLDERS' EQUITY: Preferred stock, no par
value; 500,000 shares authorized; none outstanding - - Common
stock, $.10 par value; authorized 7,000,000 shares; issued
2,187,500 shares 219 219 Additional paid-in capital 17,104 17,177
Retained earnings, substantially restricted 28,323 28,063
Accumulated other comprehensive income 418 600 Unearned
compensation restricted stock awards (276) (329) Treasury stock, at
cost, shares at March 31, 2005, 1,149,512 and 1,105,852 shares at
December 31, 2004 (20,634) (19,140) TOTAL STOCKHOLDERS' EQUITY
25,154 26,590 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $245,347
$239,395 WELLS FINANCIAL CORP. and SUBSIDIARY Consolidated
Statements of Income (Dollars in thousands, except per share data)
(Unaudited) Three Months Ended March 31, 2005 2004 Interest and
dividend income Loans receivable: First mortgage loans $1,793
$1,730 Consumer and other loans 1,384 976 Investment securities and
other interest bearing deposits 163 226 Total interest income 3,340
2,932 Interest Expense Deposits 705 661 Borrowed funds 452 310
Total interest expense 1,157 971 Net interest income 2,183 1,961
Provision for loan losses 35 - Net interest income after provision
for loan losses 2,148 1,961 Noninterest income Gain on sale of
loans originated for sale 240 279 Loan servicing fees 239 241
Insurance commissions 167 188 Fees and service charges 133 181
Other 41 30 Total noninterest income 820 919 Noninterest expense
Compensation and benefits 1,037 1,022 Occupancy and equipment 291
264 Data processing 130 140 Advertising 76 81 Amortization and
valuation adjustments for mortgage servicing rights 193 240 Other
408 387 Total noninterest expense 2,135 2,134 Income before taxes
833 746 Income tax expense 312 269 Net income $521 $477 Cash
dividends declared per share $0.24 $0.22 Earnings per share Basic
$0.49 $0.41 Diluted $0.48 $0.40 Weighted average number of common
shares outstanding: Basic 1,067,048 1,158,546 Diluted 1,089,184
1,196,291 DATASOURCE: Wells Financial Corp. CONTACT: Lonnie R.
Trasamar of Wells Financial Corp., +1-507-553-3151
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