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PRESS RELEASE
| FROM: |
Robert H. Gaughen, Jr., President Hingham Institution for Savings Hingham, MA (NASDAQ - HIFS) |
| DATE: | October 17, 2001 |
| CONTACT: | William M. Donovan, Jr., Vice President -Administration, (781) 749-2200 |
21% INCREASE IN NET INCOME
HINGHAM INSTITUTION FOR SAVINGS (NASDAQ - HIFS), Hingham, Massachusetts, announced third quarter results highlighted by continued growth in earnings driven primarily by strong growth in the balance sheet.
President Robert H. Gaughen, Jr. announced that "Net income for the third quarter increased by 21% over that of the same quarter last year. This earnings trend has been driven by our ability to expand our balance sheet and at the same time, increase our net interest margin. Our total deposits and total loans have increased by 12% and 10% respectively over the last twelve months. Additionally, earnings have benefitted from an increase in our net interest margin due to a rapidly decreasing cost of funds. The net interest margin has increased from 3.81% for the third quarter 2000 to 3.91% for the third quarter 2001."
The net income of $1,282,000, or $0.63 per share, for the third quarter represents a 21% increase over the $1,060,000, or $0.52 per share , for the third quarter of 2000. The Bank's total assets as of September 30, 2001 of $375,618,000 represent a 15% increase over the total of $326,268,000 on September 30, 2000. Total loan originations of $78,625,000 during the first nine months of 2001 contributed strongly to the $25,062,000 net increasein the size of the Bank's loan portfolio during the past year.
Asset quality continued to remain strong. At the end of the third quarter of 2001, nonperforming assets totaled only 0.12% of total assets.
The annualized Return on Average Equity and Return on Average Assets for the nine months ended September 30, 2001 were 15.93% and 1.43% respectively. Book value per share was $16.11 as of September 30, 2001, and the Bank continued to merit the Federal Deposit Insurance Corporation's highest capital rating with a tier one capital ratio of 8.88%.
Hingham Institution for Savings is a Massachusetts-chartered savings bank. Incorporated in 1834, it is the oldest financial institution headquartered in Hingham and one of the oldest in Massachusetts. The Bank's main offices are located on Main Street, Hingham, Massachusetts 02043, phone (781) 749-2200. The Bank also maintains branch offices in South Hingham and the neighboring towns of Cohasset, Hull, Scituate, and Weymouth.
The Bank's shares of common stock are listed and traded on The Nasdaq Stock Market under the symbol HIFS.
Page 1 of 3
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| Consolidated Balance Sheets | ||
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($ in thousands except per share amounts) |
September 30 , | September 30, |
|
(Unaudited) |
2001 | 2000 |
|
ASSETS |
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Cash and due from banks |
$8,022 | $5,530 |
|
Interest-bearing deposits |
32,467 | 11,166 |
|
Cash and cash equivalents |
40,489 | 16,696 |
|
Securities available for sale, at fair value |
40,718 | 41,019 |
|
Loans, net of allowance for loan losses of |
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$2,452,000 in 2001 and $2,182,000 in 2000 |
283,302 | 258,240 |
|
Banking premises and equipment, net |
3,652 | 3,231 |
|
Accrued interest receivable |
1,930 | 1,961 |
|
Deferred income tax asset, net |
712 | 1,067 |
|
Federal Home Loan Bank stock, at cost |
4,343 | 3,695 |
|
Other Assets |
472 | 359 |
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Total assets |
$375,618 | $326,268 |
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LIABILITIES AND STOCKHOLDERS' EQUITY |
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Deposits |
$248,589 | $222,690 |
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Federal Home Loan Bank advances |
86,843 | 70,902 |
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Other borrowed funds |
226 | 146 |
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Mortgagors' escrow accounts |
1,169 | 1,145 |
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Accrued interest payable |
390 | 364 |
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Other liabilities |
5,454 | 2,466 |
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Total liabilities |
342,671 | 297,713 |
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Commitments and contingencies |
-- | -- |
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Stockholders' equity: |
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Preferred stock, $1.00 par value, |
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2,500,000 shares authorized; none issued |
-- | -- |
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Common stock, $1.00 par value, 5,000,000 shares |
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authorized; shares issued and outstanding: 2,045,250 at |
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September 30, 2001 and 2,040,750 at September 30, 2000 |
2,045 | 2,041 |
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Additional paid-in capital |
8,857 | 8,809 |
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Undivided profits |
21,227 | 17,819 |
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Accumulated other comprehensive income(loss) |
818 | (114) |
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Total stockholders' equity |
32,947 | 28,555 |
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Total liabilities and stockholders' equity |
$375,618 | $326,268 |
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Book value per share |
$16.11 | $13.99 |
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Return on average equity |
15.93% | 14.93% |
Page 2 of 3
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Consolidated Statements
of Income
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(In Thousands, Except for Per Share Amounts) |
Three Months Ended September 30 |
Nine Months
Ended September 30, |
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(Unaudited) |
2001 | 2000 | 2001 | 2000 |
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Interest and dividend income: |
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Loans |
$5,736 | $5,304 | $17,157 | $15,235 |
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Investment securities |
638 | 625 | 1,929 | 1,907 |
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Interest-bearing deposits |
211 | 214 | 533 | 462 |
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Total interest and dividend income |
6,585 | 6,143 | 19,619 | 17,604 |
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Interest expense: |
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Deposits |
2,062 | 2,093 | 6,321 | 5,715 |
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Borrowed funds |
1,084 | 1,078 | 3,338 | 3,124 |
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Total interest expense |
3,146 | 3,171 | 9,659 | 8,839 |
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Net interest income |
3,439 | 2,972 | 9,960 | 8,765 |
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Provision for loan losses |
60 | 60 | 180 | 194 |
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Net interest income after provision for loan losses |
3,379 | 2,912 | 9,780 | 8,571 |
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Other income: |
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Customer service fees on deposits |
168 | 164 | 524 | 492 |
| Gain on sale of loans and securities available for sale | - | - | 136 | - |
| Other | 39 | 37 | 121 | 109 |
| Total other income | 207 | 201 | 781 | 601 |
| Operating expenses: | ||||
| Salaries and employee benefits | 936 | 845 | 2,771 | 2,530 |
| Data processing | 139 | 128 | 408 | 353 |
| Occupancy and equipment | 178 | 171 | 544 | 543 |
| Legal | 1 | 7 | 11 | 21 |
| Other | 395 | 347 | 1,152 | 1,047 |
| Total operating expenses | 1,649 | 1,498 | 4,886 | 4,494 |
| Income before income taxes | 1,937 | 1,615 | 5,675 | 4,678 |
| Income tax provision | 655 | 555 | 1,921 | 1,602 |
| Net income | $1,282 | $1,060 | $3,754 | $3,076 |
| Cash dividends declared per common share | $0.15 | $0.14 | $0.45 | $0.40 |
| Weighted average shares outstanding: | ||||
| Basic | 2,045 | 2,041 | 2,045 | 2,041 |
| Diluted | 2,073 | 2,055 | 2,070 | 2,053 |
| Earnings per share: | ||||
| Basic | $0.63 | $0.52 | $1.84 | $1.51 |
| Diluted | $0.62 | $0.52 | $1.81 | $1.50 |
