Royal Financial, Inc. Announces First Quarter Net Income of $7.2 Million, Reversal of Deferred Tax Asset Valuation and Annual...
CHICAGO, Nov. 1, 2013 /PRNewswire/ -- Royal Financial, Inc. (the "Company") (OTCBB: RYFL.OB), incorporated under the laws of Delaware on December 15, 2004, for the purpose of serving as the holding company of Royal Savings Bank (the "Bank"), announced the financial results for the first quarter end of fiscal year 2014.
For the first quarter ended September 30, 2013, the Company reported net income of $7.2 million, or $2.87 per common share, after a $6.9 million benefit from the reversal of the valuation against deferred tax assets. Income before taxes for the quarter, reflecting the benefit of a $370,000 reversal in loan loss reserve, totaled $614,000.
The Company reported income of $614,000 for the first three months of fiscal 2014 (excluding the reversal of the valuation allowance against the deferred tax assets, net of the tax accrual for the current quarter), compared to $140,000 in the same period of fiscal 2013. The increase in income was due to an increase in net interest income of $152,000 and a credit provision for loan losses of $370,000, partially offset by a decrease in non-interest income of $22,000 and an increase in non-interest expense of $34,000. The decrease in non-interest income is primarily due to a decrease of $20,000 in secondary mortgage market fees. The increase in noninterest expense is primarily the result of an increase in professional services of $52,000, partially offset by a decrease in occupancy expense of $33,000 and foreclosed asset expense of $14,000. The decrease in the provision for loan losses was related to the recognition of a credit provision of $370,000, which was directly related to a recovery of previously charged off bad debt.
Comparison of Financial Condition at September 30, 2013 and June 30, 2013
The Company's total assets increased $10.4 million, or 10.12%, to $113.6 million at September 30, 2013, from $103.2 million at June 30, 2013.
Securities available for sale increased $1.8 million, or 7.78%, to $24.4 million at September 30, 2013 from $22.6 million at June 30, 2013. The increase in the securities portfolio was due to the purchase of an additional government sponsored agency bond.
Loans, net of allowance, increased $1.8 million, or 2.55%, to $70.7 million at September 30, 2013, from $68.9 million at June 30, 2013. The increase in loans was primarily a result of locally originated commercial loan growth, consisting of commercial real estate and multi-family properties.
The Company recorded a $6.9 million reversal of the valuation allowance against the deferred tax assets, partially offset by estimated current taxes due of $267,000, resulting in an increase in assets of $6.6 million for the period.
Total deposits increased $4.8 million, or 4.80%, to $73.6 million at September 30, 2013 from $68.9 million at June 30, 2013.
Federal Home Loan Bank advances decreased $1.0 million, or 6.71%, to $13.9 million at September 30, 2013 from $14.9 million at June 30, 2013.
Total stockholders' equity increased $6.9 million, or 37.96%, to $25.0 million at September 30, 2013 from $18.1 million at June 30, 2013. The increase is primarily a result of the $6.9 million reversal of the valuation allowance against the deferred tax assets, net income of $347,000, partially offset by a decrease in accumulated other comprehensive income of $342,000, net of deferred taxes.
The allowance for loan losses was $1.3 million, or 1.86% of total loans, at September 30, 2013, as compared to $1.5 million, or 2.13% of total loans, at June 30, 2013. The Company believes, as of September 30, 2013, its allowance for loan losses was adequate to cover probable incurred losses. Nonperforming assets were $3.7 million, or 3.16%, at September 30, 2013 compared to $3.6 million, or 3.48%, at June 30, 2013.
The Bank is required to maintain regulatory capital sufficient to meet Tier 1 leverage, Tier 1 risk-based and total risk-based capital ratios of at least 4.0%, 4.0%, and 8.0%, respectively. At September 30, 2013, the Bank exceeded each of its capital requirements with ratios of 18.41%, 27.90%, and 29.16%, respectively. At September 30, 2013, the book value per common share, shares outstanding 2,507,112, was $9.96 compared to the book value per common share, shares outstanding 2,507,112, was $7.22 at June 30, 2013.
The complete audited consolidated financial statements for 2013 and 2012 remain available at www.royal-bank.us.
Submission of Matters to a Vote of Security Holders
At the Company's Annual Meeting of Stockholders held on October 29, 2013, the following matters were submitted to and approved by a vote of stockholders:
1) The election of two Class III directors for a three-year term expiring at the Annual Meeting of Stockholders to be held in 2016:
Directors
Votes For
Votes Withheld
John T. Dempsey
1,471,129
26,727
Leonard Szwajkowski
1,471,030
26,826
The following directors continue to serve after the Annual Meeting:
Continuing Director
Term Expires
C. Michael McLaren
2014
Philip J. Timyan
2014
James A. Fitch, Jr.
2015
Roger L. Hupe
2015
John T. Dempsey
2016
Leonard Szwajkowski
2016
2) Ratification of the appointment of Crowe Horwath LLP as the Company's independent accountants for the fiscal year ending June 30, 2014:
Total votes for
2,010,500
Total votes against
63,981
Total votes abstaining
16,412
Contact: Mr. Leonard Szwajkowski
President and CEO
Telephone: (773) 382-2111
E-mail: lszwajkowski@royal-bank.us
Consolidated Statements of Financial Condition
September 30, 2013 and June 30, 2013
(Unaudited)
September 30, 2013
June 30, 2013
Assets
Cash and non-interest bearing balances in financial institutions
$ 1,008,689
$ 893,499
Interest bearing balances in financial institutions
2,525,927
2,274,266
Federal funds sold
79,699
97,148
Total cash and cash equivalents
3,614,315
3,264,913
Securities available for sale
24,352,739
22,594,623
Loans receivable, net of allowance for loan losses of
$1,345,380 at September 30, 2013, $1,508,966 at June 30, 2013
70,706,695
68,945,527
Federal Home Loan Bank stock, at cost
1,295,000
1,295,000
Premises & equipment, net
4,277,320
4,217,182
Land held for sale
265,000
265,000
Accrued interest receivable
450,928
447,888
Other real estate owned
1,895,000
1,895,000
Deferred tax asset
6,586,820
-
Other assets
174,261
249,592
Total assets
$ 113,618,079
$ 103,174,725
Liabilities & Stockholders' Equity
Deposits
$ 73,648,888
$ 68,886,926
Advances from borrowers for taxes and insurance
617,569
866,913
Federal Home Loan Bank advances
13,900,000
14,900,000
Accrued interest payable and other liabilities
478,443
419,710
Total liabilities
88,644,900
85,073,549
Stockholders' equity
Preferred stock $0.01 par value per share, authorized
1,000,000 shares, no issues are outstanding
-
-
Common stock, $0.01 par value per share, authorized 5,000,000 shares, 2,645,000 shares issued
26,450
26,450
Additional paid-in capital
23,773,360
23,759,673
Retained earnings (deficit)
2,012,863
(5,187,593)
Treasury stock, 137,888, at cost
(1,012,924)
(1,012,924)
Accumulated other comprehensive income
173,431
515,570
Total stockholders' equity
24,973,180
18,101,176
Total liabilities and stockholders' equity
$ 113,618,079
$ 103,174,725
This report has not been prepared in accordance with Securities and Exchange Commission ("SEC") rules applicable to SEC registrant companies and is not intended to comply with such rules.
Consolidated Statements of Operations
Three Months Ended September 30, 2013 and 2012
(Unaudited)
Three Months Ended
September 30
2013
2012
Interest income
Loans
$ 1,003,718
$718,855
Securities
162,619
305,087
Federal funds sold and other
1,761
1,333
Total interest income
1,168,098
1,025,275
Interest expense
Deposits
36,664
39,638
Borrowings
5,797
11,581
Total interest expense
42,461
51,219
Net interest income
1,125,637
974,056
Provision/(Credit) for loan losses
(369,785)
-
Net interest income after provision/ (credit) for loan losses
1,495,422
974,056
Non-interest income
Service charges on deposit accounts
42,869
41,713
Secondary mortgage market fees
33,428
53,651
Income on other real estate owned
43,251
46,277
Gain on sale of investment securities
-
-
Other
227
277
Total non-interest income
119,775
141,918
Non-interest expense
Salaries and employee benefits
417,095
414,450
Occupancy and equipment
147,600
180,246
Data processing
86,015
87,908
Professional services
146,783
93,928
Director fees
28,800
15,800
Marketing
4,675
4,717
FDIC insurance expense
32,759
31,291
Insurance premiums
17,457
16,548
Foreclosed asset expense
20,460
34,688
Other
99,917
88,304
Total non-interest expense
1,001,561
967,880
Income before income taxes
613,636
148,094
Provision (Benefit) for income taxes
(6,586,820)
8,000
Net income
$ 7,200,456
$ 140,094
Basic and diluted earnings per share
$ 2.87
$ 0.06
This report has not been prepared in accordance with Securities and Exchange Commission ("SEC") rules applicable to SEC registrant companies and is not intended to comply with such rules.
SOURCE Royal Financial, Inc.
Copyright 2013 PR Newswire
CHICAGO, Nov. 1, 2013 /PRNewswire/ -- Royal Financial, Inc. (the "Company") (OTCBB: RYFL.OB), incorporated under the laws of Delaware on December 15, 2004, for the purpose of serving as the holding company of Royal Savings Bank (the "Bank"), announced the financial results for the first quarter end of fiscal year 2014.
For the first quarter ended September 30, 2013, the Company reported net income of $7.2 million, or $2.87 per common share, after a $6.9 million benefit from the reversal of the valuation against deferred tax assets. Income before taxes for the quarter, reflecting the benefit of a $370,000 reversal in loan loss reserve, totaled $614,000.
The Company reported income of $614,000 for the first three months of fiscal 2014 (excluding the reversal of the valuation allowance against the deferred tax assets, net of the tax accrual for the current quarter), compared to $140,000 in the same period of fiscal 2013. The increase in income was due to an increase in net interest income of $152,000 and a credit provision for loan losses of $370,000, partially offset by a decrease in non-interest income of $22,000 and an increase in non-interest expense of $34,000. The decrease in non-interest income is primarily due to a decrease of $20,000 in secondary mortgage market fees. The increase in noninterest expense is primarily the result of an increase in professional services of $52,000, partially offset by a decrease in occupancy expense of $33,000 and foreclosed asset expense of $14,000. The decrease in the provision for loan losses was related to the recognition of a credit provision of $370,000, which was directly related to a recovery of previously charged off bad debt.
Comparison of Financial Condition at September 30, 2013 and June 30, 2013
The Company's total assets increased $10.4 million, or 10.12%, to $113.6 million at September 30, 2013, from $103.2 million at June 30, 2013.
Securities available for sale increased $1.8 million, or 7.78%, to $24.4 million at September 30, 2013 from $22.6 million at June 30, 2013. The increase in the securities portfolio was due to the purchase of an additional government sponsored agency bond.
Loans, net of allowance, increased $1.8 million, or 2.55%, to $70.7 million at September 30, 2013, from $68.9 million at June 30, 2013. The increase in loans was primarily a result of locally originated commercial loan growth, consisting of commercial real estate and multi-family properties.
The Company recorded a $6.9 million reversal of the valuation allowance against the deferred tax assets, partially offset by estimated current taxes due of $267,000, resulting in an increase in assets of $6.6 million for the period.
Total deposits increased $4.8 million, or 4.80%, to $73.6 million at September 30, 2013 from $68.9 million at June 30, 2013.
Federal Home Loan Bank advances decreased $1.0 million, or 6.71%, to $13.9 million at September 30, 2013 from $14.9 million at June 30, 2013.
Total stockholders' equity increased $6.9 million, or 37.96%, to $25.0 million at September 30, 2013 from $18.1 million at June 30, 2013. The increase is primarily a result of the $6.9 million reversal of the valuation allowance against the deferred tax assets, net income of $347,000, partially offset by a decrease in accumulated other comprehensive income of $342,000, net of deferred taxes.
The allowance for loan losses was $1.3 million, or 1.86% of total loans, at September 30, 2013, as compared to $1.5 million, or 2.13% of total loans, at June 30, 2013. The Company believes, as of September 30, 2013, its allowance for loan losses was adequate to cover probable incurred losses. Nonperforming assets were $3.7 million, or 3.16%, at September 30, 2013 compared to $3.6 million, or 3.48%, at June 30, 2013.
The Bank is required to maintain regulatory capital sufficient to meet Tier 1 leverage, Tier 1 risk-based and total risk-based capital ratios of at least 4.0%, 4.0%, and 8.0%, respectively. At September 30, 2013, the Bank exceeded each of its capital requirements with ratios of 18.41%, 27.90%, and 29.16%, respectively. At September 30, 2013, the book value per common share, shares outstanding 2,507,112, was $9.96 compared to the book value per common share, shares outstanding 2,507,112, was $7.22 at June 30, 2013.
The complete audited consolidated financial statements for 2013 and 2012 remain available at www.royal-bank.us.
Submission of Matters to a Vote of Security Holders
At the Company's Annual Meeting of Stockholders held on October 29, 2013, the following matters were submitted to and approved by a vote of stockholders:
1) The election of two Class III directors for a three-year term expiring at the Annual Meeting of Stockholders to be held in 2016:
Directors
Votes For
Votes Withheld
John T. Dempsey
1,471,129
26,727
Leonard Szwajkowski
1,471,030
26,826
The following directors continue to serve after the Annual Meeting:
Continuing Director
Term Expires
C. Michael McLaren
2014
Philip J. Timyan
2014
James A. Fitch, Jr.
2015
Roger L. Hupe
2015
John T. Dempsey
2016
Leonard Szwajkowski
2016
2) Ratification of the appointment of Crowe Horwath LLP as the Company's independent accountants for the fiscal year ending June 30, 2014:
Total votes for
2,010,500
Total votes against
63,981
Total votes abstaining
16,412
Contact: Mr. Leonard Szwajkowski
President and CEO
Telephone: (773) 382-2111
E-mail: lszwajkowski@royal-bank.us
Consolidated Statements of Financial Condition
September 30, 2013 and June 30, 2013
(Unaudited)
September 30, 2013
June 30, 2013
Assets
Cash and non-interest bearing balances in financial institutions
$ 1,008,689
$ 893,499
Interest bearing balances in financial institutions
2,525,927
2,274,266
Federal funds sold
79,699
97,148
Total cash and cash equivalents
3,614,315
3,264,913
Securities available for sale
24,352,739
22,594,623
Loans receivable, net of allowance for loan losses of
$1,345,380 at September 30, 2013, $1,508,966 at June 30, 2013
70,706,695
68,945,527
Federal Home Loan Bank stock, at cost
1,295,000
1,295,000
Premises & equipment, net
4,277,320
4,217,182
Land held for sale
265,000
265,000
Accrued interest receivable
450,928
447,888
Other real estate owned
1,895,000
1,895,000
Deferred tax asset
6,586,820
-
Other assets
174,261
249,592
Total assets
$ 113,618,079
$ 103,174,725
Liabilities & Stockholders' Equity
Deposits
$ 73,648,888
$ 68,886,926
Advances from borrowers for taxes and insurance
617,569
866,913
Federal Home Loan Bank advances
13,900,000
14,900,000
Accrued interest payable and other liabilities
478,443
419,710
Total liabilities
88,644,900
85,073,549
Stockholders' equity
Preferred stock $0.01 par value per share, authorized
1,000,000 shares, no issues are outstanding
-
-
Common stock, $0.01 par value per share, authorized 5,000,000 shares, 2,645,000 shares issued
26,450
26,450
Additional paid-in capital
23,773,360
23,759,673
Retained earnings (deficit)
2,012,863
(5,187,593)
Treasury stock, 137,888, at cost
(1,012,924)
(1,012,924)
Accumulated other comprehensive income
173,431
515,570
Total stockholders' equity
24,973,180
18,101,176
Total liabilities and stockholders' equity
$ 113,618,079
$ 103,174,725
This report has not been prepared in accordance with Securities and Exchange Commission ("SEC") rules applicable to SEC registrant companies and is not intended to comply with such rules.
Consolidated Statements of Operations
Three Months Ended September 30, 2013 and 2012
(Unaudited)
Three Months Ended
September 30
2013
2012
Interest income
Loans
$ 1,003,718
$718,855
Securities
162,619
305,087
Federal funds sold and other
1,761
1,333
Total interest income
1,168,098
1,025,275
Interest expense
Deposits
36,664
39,638
Borrowings
5,797
11,581
Total interest expense
42,461
51,219
Net interest income
1,125,637
974,056
Provision/(Credit) for loan losses
(369,785)
-
Net interest income after provision/ (credit) for loan losses
1,495,422
974,056
Non-interest income
Service charges on deposit accounts
42,869
41,713
Secondary mortgage market fees
33,428
53,651
Income on other real estate owned
43,251
46,277
Gain on sale of investment securities
-
-
Other
227
277
Total non-interest income
119,775
141,918
Non-interest expense
Salaries and employee benefits
417,095
414,450
Occupancy and equipment
147,600
180,246
Data processing
86,015
87,908
Professional services
146,783
93,928
Director fees
28,800
15,800
Marketing
4,675
4,717
FDIC insurance expense
32,759
31,291
Insurance premiums
17,457
16,548
Foreclosed asset expense
20,460
34,688
Other
99,917
88,304
Total non-interest expense
1,001,561
967,880
Income before income taxes
613,636
148,094
Provision (Benefit) for income taxes
(6,586,820)
8,000
Net income
$ 7,200,456
$ 140,094
Basic and diluted earnings per share
$ 2.87
$ 0.06
This report has not been prepared in accordance with Securities and Exchange Commission ("SEC") rules applicable to SEC registrant companies and is not intended to comply with such rules.
SOURCE Royal Financial, Inc.
Copyright 2013 PR Newswire
