ONEIDA, N.Y., Jan. 30 /PRNewswire-FirstCall/ -- Oneida Financial Corp. (Nasdaq: ONFC), the parent company of The Oneida Savings Bank, has announced its operating results for the year and three months ended December 31, 2005 . Net income for the year ended December 31, 2005 is $3.9 million or $0.50 diluted earnings per share, an increase of 17.2% compared with $3.3 million , or $0.43 diluted earnings per share, for the year ended December 31, 2004 . The increase in net income is primarily the result of an increase in net interest income, an increase in non-interest income and a decrease in provisions for loan losses, partially offset by an increase in non-interest expense during 2005 as compared with 2004. Net income for the three months ended December 31, 2005 is $1.0 million , or $0.13 diluted earnings per share, as compared to $588,000 or $0.08 diluted earnings per share for the same period in 2004. The increase in net income in the fourth quarter of 2005 is primarily due to an increase in non-interest income.
Total assets increased $14.1 million , or 3.3% to $436.7 million at December 31, 2005 from $422.6 million at December 31, 2004 . The increase in the Company's assets is primarily due to increases in loans receivable and investment securities, partially offset by a decrease in mortgage-backed securities. Loans receivable increased $24.2 million at December 31, 2005 as compared with December 31, 2004 , after recording the sale of $14.8 million in fixed rate one-to-four family residential real estate loans. Mortgage-backed securities decreased $15.3 million to $29.1 million and investment securities increased $560,000 to $110.3 million at December 31, 2005 . The comparable levels at December 31, 2004 were $44.4 million and $109.7 million , respectively. The decrease in mortgage-backed securities supported the increase in loans receivable at December 31, 2005 compared with December 31, 2004 .
Michael R. Kallet, President and Chief Executive Officer of Oneida
Financial Corp., said, 'Our Company's operating results continue to reflect
the successful execution of our business plan. The growth and diversification
of our asset mix, income sources and product offering has resulted in a record
level of net income earned during 2005.' Kallet continued, 'Net income is only
one measure of our Company's success; Oneida Savings reported a record level
of net loans receivable at December 31, 2005 , our insurance and financial
services subsidiary,
Net interest income increased $498,000 , or 3.9%, for the year ended December 31, 2005 to $13.3 million compared with $12.8 million for the year ended December 31, 2004 . The increase in net interest income is due primarily to an increase in net earning assets and an increase in net interest margin. Average interest-earning assets increased $3.7 million to $380.5 million for the year ended December 31, 2005 . Average interest-bearing deposits increased $367,000 while average borrowings outstanding increased by $2.6 million .
Interest income for the twelve-month period ending December 31, 2005 is $21.0 million , compared with $19.7 million for the twelve months ending December 31, 2004 , an increase of 6.9%. The increase in interest income during the year ended December 31, 2005 resulted primarily from an increase in the yield on interest earning assets of 30 basis points, reflecting the increased yields earned on investments and loans during 2005 due to the increase in market interest rates. The increase in yield was further supported by an increase in the average balances of interest-earning assets during 2005.
Interest expense for the twelve-month period ending December 31, 2005 is $7.7 million , compared with $6.8 million for the twelve months ending December 31, 2004 , an increase of 12.4%. This increase was due to an increase in the cost of interest-bearing liabilities of 24 basis points and by the previously reported increase in the average balance of interest-bearing liabilities. Borrowed funds outstanding are $77.3 million at December 31, 2005 , compared with $64.4 million at December 31, 2004 . Interest expense on deposits increased 14.3% for the year ended December 31, 2005 as compared with the same period in 2004. The increase in interest expense is primarily the result of the steady increase of short-term market interest rates during 2005 partially offset by the continued emphasis to increase the level of lower costing core savings and checking deposits.
Other non-interest income is $11.9 million for the twelve months ending December 31, 2005 compared with $10.2 million for the same 2004 period. The increase in other non-interest income is the result of increases in net investment gains, commissions earned on the sale of financial products and services charges on deposit accounts. Net gains realized upon the sale of investment securities are $275,000 for the year ended December 31, 2005 compared with a net loss on investment securities of $961,000 during 2004, the result of a non-cash charge of $1.1 million to record the other-than-temporary impairment of certain perpetual preferred stock investments in Fannie Mae and Freddie Mac. Revenue derived from the Company's insurance agency subsidiary activities, increased $439,000 , or 5.7% during 2005 as compared with 2004. During 2005 the Company had a decrease in revenue derived from the sale and servicing of fixed-rate residential real estate loans due to a reduction volume of loan refinancing activity in 2005 as compared with 2004. This decrease in other non-interest income was offset by an increased level of service charges on deposit accounts, increasing $124,000 , or 6.1% for the year ended December 31, 2005 compared with 2004.
Other non-interest expense is $19.6 million for the twelve months ending December 31, 2005 compared with $18.3 million for 2004, an increase of 7.1%. The increase in other non-interest expense is primarily the result of an increase in salaries and employee benefits associated with an increase in revenue derived from insurance operations. In addition, during 2004 employee benefits expense was reduced by $357,000 due to the curtailment of future benefits under the Company's defined benefit pension plan.
The provision for loan losses is $360,000 in 2005, down from $450,000 in 2004. Net loan charge-offs in 2005 totaled $383,000 , or 0.16% of average loans outstanding, decreasing from $584,000 or 0.28% of average loans in 2004. The ratio of non-performing assets to total assets is 0.05% at December 31, 2005 compared with 0.14% at December 31, 2004 . The decrease in net loan charge- offs and the decrease in non-performing assets supports the reduction in the provision for loan losses during 2005. The ratio of the loan loss allowance to loans receivable is 0.83% at December 31, 2005 compared with a ratio of 0.94% at December 31, 2004 . The decline in the allowance as a percentage of loans reflects improvement in various credit factors, including the reduction in non-performing assets.
Net income for the three months ended December 31, 2005 was $1.0 million , or $0.13 diluted earnings per share, as compared to $588,000 or $0.08 diluted earnings per share for the same period in 2004. The increase in net income for the quarter is primarily the result of an increase in net investment security gains for the fourth quarter of 2005 as compared with fourth quarter of 2004, due to the non-cash impairment charge recognized during the 2004 period. Partially offsetting this increase in revenue is an increase in expense associated with the Company's defined benefit pension plans due to the absence in 2005 of the curtailment credit realized in 2004, an increase in the provision for possible loan losses and an increase in income tax provisions
Shareholders' equity was $53.5 million , or 12.3% of assets at December 31, 2005 compared with $52.6 million , or 12.5% of assets, at December 31, 2004 . The increase in shareholders' equity was primarily a result of the contribution of net earnings for the period, partially offset by valuation adjustments made for the Company's available for sale investment and mortgage- backed securities, as well as recognition of a minimum pension liability and the payment of cash dividends during 2005. The Company announced a stock repurchase program in June 2004 , to date there has not been any Company stock acquired under the repurchase program.
This release may contain certain forward-looking statements, which are based on management's current expectations regarding economic, legislative, and regulatory issues that may impact the Company's earnings in future periods. Factors that could cause future results to vary materially from current management expectations include, but are not limited to, general economic conditions, changes in interest rates, deposit flows, loan demand, real estate values, and competition; changes in accounting principles, policies, or guidelines; changes in legislation or regulation; and economic, competitive, governmental, regulatory, and technological factors affecting the Company's operations, pricing, products, and services.
All financial information provided at and for the year ended December 31, 2005 and all quarterly data is unaudited. Selected financial ratios have been annualized where appropriate. Operating data is presented in thousands of dollars, except for per share amounts. Per share amounts for prior periods have been restated for the effect of the three-for-two stock split paid on February 24, 2004 .
At and for the At and for the
Selected Financial Ratios Three Months Twelve months
(unaudited) Ended Dec 31, Ended Dec 31,
2005 2004 2005 2004
Return on Average Assets 0.94% 0.55% 0.89% 0.77%
Return on Average Equity 7.74% 4.51% 7.30% 6.49%
Return on Average Tangible
Equity 10.61% 6.05% 9.84% 8.73%
Net Interest Margin 3.42% 3.45% 3.50% 3.40%
Non-Performing Assets to
Total Assets (end of period) 0.05% 0.14% 0.05% 0.14%
Allowance for Loan Losses to
Loans Receivable, net 0.83% 0.94% 0.83% 0.94%
Average Equity to Average
Assets 12.08% 12.20% 12.21% 11.84%
Selected Financial
Data At At % At At
(in thousands except Dec 31, Dec 31, Change Dec 31, Dec 31,
per share data) 2005 2004 '05 vs '04 2003 2002
(unaudited) (audited) (audited) (audited)
Total Assets $436,717 $422,609 3.3% $428,189 $416,670
Loans receivable, net 236,077 211,879 11.4% 200,596 197,896
Mortgage-backed
securities 29,097 44,378 (34.4%) 51,788 39,719
Investment securities 110,290 109,730 0.5% 122,049 123,256
Goodwill and other
intangibles 14,364 13,270 8.2% 12,731 12,091
Interest bearing
deposits 250,142 251,565 (0.6%) 255,871 245,828
Non-interest bearing
deposits 51,044 50,082 1.9% 49,644 45,951
Borrowings 77,270 64,400 20.0% 67,400 73,500
Shareholders' Equity 53,544 52,644 1.7% 50,835 48,064
Book value per share
(end of period) $7.02 $7.00 2.9% $6.83 $6.56
Tangible value per share
(end of period) $5.14 $5.23 (1.7%) $5.12 $4.91
Selected Operating
Data
(in thousands except Three Months Ended % Three Months Ended
per share data) Dec 31, Dec 31, Change Dec 31, Dec 31,
2005 2004 '05 vs '04 2003 2002
(unaudited)(unaudited) (unaudited)(unaudited)
Interest income:
Interest and fees
on loans $3,795 $3,257 16.5% $3,251 $3,683
Interest and
dividends on
investments 1,655 1,676 (1.3%) 1,695 1,894
Interest on fed
funds 8 23 (65.2%) 14 33
Total interest
income 5,458 4,956 10.1% 4,960 5,610
Interest expense:
Interest on deposits 1,315 979 34.3% 1,130 1,499
Interest on
borrowings 840 739 13.7% 739 909
Total interest
expense 2,155 1,718 25.4% 1,869 2,408
Net interest income 3,303 3,238 2.0% 3,091 3,202
Provision for loan
losses 100 0 100.0% 120 (186)
Net interest income
after provision for
loan losses 3,203 3,238 (1.1%) 2,971 3,388
Other income:
Net investment gains
(losses) 222 (1,010) N/M 536 183
Service charges on
deposit accts 586 521 12.5% 470 341
Commissions earned on
sale of financial
products 1,992 1,869 6.6% 1,808 1,279
Other revenue from
operations 329 408 (19.4%) 367 515
Total non-interest
income 3,129 1,788 75.0% 3,181 2,318
Other expense:
Salaries and employee
benefits 3,108 2,701 15.1% 3,207 2,759
Equipment and net
occupancy 842 824 2.2% 842 816
Intangible
amortization 28 28 - 28 27
Other costs of
operations 954 888 7.4% 1,335 761
Total non-interest
expense 4,932 4,441 11.1% 5,412 4,363
Income before income
taxes 1,400 585 139.3% 740 1,343
Income tax provision 369 (3) N/M 112 296
Net income $1,031 $588 75.3% $628 $1,047
Net income per
common share
(EPS - Basic) $0.14 $0.08 75.0% $0.08 $0.14
Net income per
common share
(EPS - Diluted) $0.13 $0.08 62.5% $0.08 $0.13
Selected Operating
Data
(in thousands except Twelve Months Ended % Twelve Months Ended
per share data) Dec 31, Dec 31, Change Dec 31, Dec 31,
2005 2004 '05 vs '04 2003 2002
(unaudited) (audited) (audited) (audited)
Interest income:
Interest and fees
on loans $14,197 $12,907 10.0% $13,592 $14,014
Interest and
dividends on
investments 6,766 6,714 0.8% 7,108 7,452
Interest on fed
funds 49 43 14.0% 94 185
Total interest
income 21,012 19,664 6.9% 20,794 21,651
Interest expense:
Interest on deposits 4,546 3,976 14.3% 4,941 6,541
Interest on
borrowings 3,141 2,861 9.8% 3,282 3,627
Total interest
expense 7,687 6,837 12.4% 8,223 10,168
Net interest income 13,325 12,827 3.9% 12,571 11,483
Provision for loan
losses 360 450 (20.0%) 530 164
Net interest income
after provision for
loan losses 12,965 12,377 4.8% 12,041 11,319
Other income:
Net investment gains
(losses) 275 (961) N/M 765 299
Service charges on
deposit accts 2,145 2,021 6.1% 1,625 1,062
Commissions earned
on sale of
financial products 8,163 7,724 5.7% 6,751 5,455
Other revenue from
operations 1,309 1,456 (10.1%) 1,813 1,703
Total non-interest
income 11,892 10,240 16.1% 10,954 8,519
Other expense:
Salaries and
employee benefits 12,413 11,430 8.6% 11,407 9,582
Equipment and net
occupancy 3,315 3,265 1.5% 3,318 2,876
Intangible
amortization 113 113 - 110 63
Other costs of
operations 3,768 3,508 7.4% 3,890 2,961
Total non-interest
expense 19,609 18,316 7.1% 18,725 15,482
Income before income
taxes 5,248 4,301 22.0% 4,270 4,356
Income tax provision 1,390 1,009 37.8% 1,148 1,160
Net income $3,858 $3,292 17.2% $3,122 $3,196
Net income per
common share
(EPS - Basic) $0.51 $0.44 15.9% $0.42 $0.44
Net income per
common share
(EPS - Diluted) $0.50 $0.43 16.3% $0.41 $0.43
Cash Dividends Paid $0.410 $0.377 8.8% $0.367 $0.340
SOURCE Oneida Financial Corp.
