Northway Financial, Inc. (the "Company") (OTCBB: NWYF) reported net
income for the quarter ended March 31, 2012 of $1,483,000 compared
to net income of $1,005,000 for the quarter ended March 31, 2011,
an increase of $478,000. For the quarter ended March 31, 2012, net
income available to common stockholders was $1,340,000, or $0.51
per common share, and was 59% more than the same period last year.
Other Financial Highlights
- Taking into account the level of net income for the quarter
ended March 31, 2012, the Company's returns on average assets and
average equity for this period were 0.72% and 7.81%, respectively,
compared to 0.48% and 7.19% for the same period last year.
- Total equity increased $18,829,000, or 32.9%, to $75,987,000 at
March 31, 2012, compared to $57,158,000 at March 31, 2011.
Approximately $13,000,000 of the increase was due to the Company's
participation in the Small Business Lending Fund, a program
designed to encourage lending to small business. This is described
in greater detail in the Company's 2011 Annual Report. In addition,
net income for the twelve month period ended March 31, 2012
accounted for $5,600,000 of the increase.
- Total deposits decreased $14,440,000, or 2.3%, to $617,923,000
at March 31, 2012, compared to $632,363,000 at March 31, 2011. The
sale of three banking centers in May 2011 resulted in a reduction
in deposits of $63,800,000. This was partially offset by organic
deposit growth of $49,360,000.
- Net loans increased $7,951,000, or 1.6%, to $507,584,000 at
March 31, 2012, compared to $499,633,000 at March 31, 2011. The
sale of the three banking centers in May 2011 included the sale of
loans totaling $33,375,000, which was more than offset by a
$41,326,000 increase in the Company's loan portfolio.
- Nonaccrual loans as a percentage of total loans at March 31,
2012 decreased to 3.27% from 4.03% as of March 31, 2011 as a result
of a focused effort to resolve problem loans.
Earnings Summary
As noted above, the Company recorded net income of $1,483,000
for the quarter ended March 31, 2012 compared to $1,005,000 for the
same period in 2011. For the quarter ended March 31, 2012,
$1,340,000, or $0.51 per common share, was available to common
stockholders compared to $844,000, or $0.32 per common share, for
the same period last year.
Net interest and dividend income for the quarter ended March 31,
2012, increased $571,000 to $6,351,000 compared to $5,780,000 for
the same period last year. The provision for loan losses
year-to-date 2012 increased $123,000 to $738,000 compared to
$615,000 for the same period in 2011. Net gains on sales of
securities were $1,060,000 compared to $306,000 for the quarter
ended March 31, 2011, an increase of $754,000. Gains on sales of
loans decreased $147,000 as of March 31, 2012 compared to the same
period last year. All other noninterest income decreased $186,000
to $1,204,000 compared to $1,390,000 for the same period last year
due primarily to a decrease in service charges and fees on deposit
accounts. Total noninterest expense increased $98,000 to $6,324,000
for the quarter ended March 31, 2012, compared to $6,226,000 for
the same period last year. This increase resulted primarily from an
increase in pension expense and higher staffing levels and
advertising expense to support our expansion strategy which was
partially offset by lower FDIC insurance, legal fees, OREO and loan
workout expenses and consulting expense. Income tax expense for the
quarter ended March 31, 2012, increased $293,000 from the same
period last year.
Balance Sheet Summary
At March 31, 2012, the Company had total assets of $821,167,000
compared to $831,026,000 at March 31, 2011, a decrease of
$9,859,000. Cash and due from banks and interest-bearing deposits
decreased $36,044,000 to $15,228,000 at March 31, 2012 compared to
$51,272,000 at March 31, 2011. Securities available-for-sale
increased $23,052,000 to $251,147,000 at March 31, 2012, compared
to $228,095,000 at March 31, 2011. Loans at March 31, 2012,
increased $7,951,000 to $507,584,000 compared to $499,633,000 at
March 31, 2011. The sale of three banking centers in May 2011
included the sale of loans totaling $33,375,000, which was more
than offset by a $41,326,000 increase in the Company's loan
portfolio.
Total deposits were $617,923,000 at March 31, 2012, compared to
$632,363,000 at March 31, 2011, a decrease of $14,440,000.
Securities sold under agreements to repurchase decreased $9,040,000
to $19,048,000 at March 31, 2012 compared to $28,088,000 at March
31, 2011. These decreases were due to the sale of the three banking
centers, which resulted in a reduction in total deposits and
securities sold under agreements to repurchase of $63,800,000 and
$3,200,000, respectively. Excluding the impact of the banking
center sale, total deposits increased $49,360,000 and securities
sold under agreements to repurchase decreased $5,840,000. Other
borrowings decreased $7,340,000 to $99,247,000 at March 31, 2012,
compared to $106,587,000 at March 31, 2011.
Total equity increased $18,829,000 to $75,987,000 at March 31,
2012 compared to $57,158,000 at March 31, 2011, of which
approximately $13,000,000 was an additional investment from the U.
S. Department of the Treasury during 2011 under the Small Business
Lending Fund program. Stockholders' equity available to common
stockholders totaled $52,519,000, resulting in a book value per
common share of $20.04 per share at March 31, 2012, based on
2,620,755 shares of common stock outstanding, an increase of $2.26,
or 12.7% per share, from March 31, 2011.
About Northway Financial, Inc.
Northway Financial, Inc., headquartered in North Conway, New
Hampshire, is a bank holding company. Through its subsidiary bank,
Northway Bank, the Company offers a broad range of financial
products and services to individuals, businesses and the public
sector from its 17 full-service banking offices and its loan
production offices located in Bedford and Portsmouth, New
Hampshire.
Forward-looking Statements
Statements included in this press release that are not
historical or current fact are "forward-looking statements" made
pursuant to the safe harbor provision of the Private Securities
Litigation Reform Act of 1995, and are subject to certain risks and
uncertainties that could cause actual results to differ materially
from historical earnings and those presently anticipated or
projected. Northway Financial, Inc. disclaims any obligation to
subsequently revise any forward-looking statements to reflect
events or circumstances after the date of such statements, or to
reflect the occurrence of anticipated or unanticipated events or
circumstances.
Northway Financial, Inc.
Selected Financial Highlights
(Unaudited)
(Dollars in thousands, except per share data) Three Months Ended
-----------------------
3/31/2012 3/31/2011
----------- -----------
Interest and Dividend Income $ 8,207 $ 7,992
Interest Expense 1,856 2,212
Net Interest and Dividend Income 6,351 5,780
Provision for Loan Losses 738 615
Noninterest Income 2,468 2,047
Noninterest Expense 6,324 6,226
Provision for Income Tax 274 (19)
Net Income 1,483 1,005
Net Income Available to Common Stockholders 1,340 844
Earnings Per Common Share, Basic 0.51 0.32
Dividends Declared per Common Share - -
3/31/2012 3/31/2011
------------- -------------
Total Assets $ 821,167 $ 831,026
Cash and Due from Banks and Interest-Bearing
Deposits 15,228 51,272
Securities Available-for-Sale, at Fair Value 251,147 228,095
Loans, Net 507,584 499,633
Total Deposits 617,923 632,363
Federal Home Loan Bank Advances 78,627 85,967
Securities Sold Under Agreements to Repurchase 19,048 28,088
Junior Subordinated Debentures 20,620 20,620
Stockholders' Equity 75,987 57,158
Book Value Per Share of Common Shares
Outstanding 20.04 17.78
Tangible Book Value Per Share of Common Shares
Outstanding 15.82 13.14
Tier 1 Core Capital to Average Assets 10.45% 7.69%
Common Shares Outstanding 2,620,755 2,620,755
Return on Average Assets 0.72% 0.48%
Return on Average Equity 7.81 7.19
Nonperforming Loans as a % of Total Loans 3.27 4.03
Contact: Richard P. Orsillo Senior Vice President and Chief
Financial Officer 603-752-1171
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