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Provident Financial Holdings Inc. Reports Operating Results (10-Q)

February 09, 2012 | About:
10qk

10qk

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Provident Financial Holdings Inc. (PROV) filed Quarterly Report for the period ended 2011-12-31.

Provident Financial Holdings Inc. has a market cap of $110.1 million; its shares were traded at around $9.7 with a P/E ratio of 13.1 and P/S ratio of 1.2. The dividend yield of Provident Financial Holdings Inc. stocks is 1.2%.

Highlight of Business Operations:

The Corporation s net income for the quarter ended December 31, 2011 was $1.9 million, a decrease of $2.4 million or 56 percent, from $4.3 million for the same quarter of fiscal 2011. The decrease in net earnings was primarily a result of a $2.8 million decrease in non-interest income and a $1.2 million increase in non-interest expenses. For the six months ended December 31, 2011, the Corporation s net income was $4.2 million, a decrease of $4.6 million or 52 percent, from $8.8 million for the same period of fiscal 2011. The decrease in net income was primarily a result of a $1.2 million decrease in net interest income (before provision for loan losses), a $4.5 million decrease in non-interest income and a $2.2 million increase in non-interest expenses.

For the Quarters Ended December 31, 2011 and 2010. Net interest income (before the provision for loan losses) decreased $202,000, or two percent, to $9.5 million for the quarter ended December 31, 2011 from $9.7 million for the comparable period in fiscal 2011, due to a decline in average earning assets, partly offset by an increase in the net interest margin. The average balance of earning assets decreased $51.4 million, or four percent, to $1.26 billion in the second quarter of fiscal 2012 from $1.31 billion in the comparable period of fiscal 2011, consistent with the Corporation s strategy of managing liquidity and credit risks. The net interest margin was 3.02 percent in the second quarter of fiscal 2012, up six basis points from 2.96 percent in the same period of fiscal 2011 due to the decline in the average cost of liabilities outpacing the declining yield of interest-earning assets. The weighted-average cost of interest-bearing liabilities decreased by 43 basis points to 1.37 percent, while the weighted-average yield of interest-earning assets decreased by 36 basis points to 4.27 percent for the second quarter of fiscal 2012 as compared to the same period last year.

For the Six Months Ended December 31, 2011 and 2010. Net interest income (before the provision for loan losses) decreased $1.2 million, or six percent, to $18.3 million for the six months ended December 31, 2011 from $19.5 million in the comparable period last year due primarily to a decline in average earning assets and a lower net interest margin. The average balance of earning assets decreased $61.4 million, or five percent, to $1.26 billion in the first six months of fiscal 2012 from $1.32 billion in the comparable period of fiscal 2011. The net interest margin was 2.90 percent in the first six months of fiscal 2012, a five basis point decrease from 2.95 percent for the same period of fiscal 2011. The decrease in the net interest margin during the six months of fiscal 2012 was primarily attributable to the decrease in the weighted-average yield of interest-earning assets which was more than the decrease in the weighted-average cost of interest-bearing liabilities. The weighted-average yield of interest-earning assets decreased by 50 basis points to 4.20 percent, while the weighted-average cost of interest-bearing liabilities decreased by 46 basis points to 1.41 percent for the first six months of fiscal 2012 as compared to the same period last year.

Interest income from interest-earning deposits, primarily cash deposited at the Federal Reserve Bank of San Francisco, was $37,000 in the second quarter of fiscal 2012, down from $65,000 in the same quarter of fiscal 2011. The decrease was due to a lower average balance for the quarter ended December 31, 2011 as compared to the same period last year as the average yield was unchanged at 25 basis points. The average balance of the interest-earning deposits in the second quarter of fiscal 2012 was $57.2 million, a decrease of $46.4 million or 45 percent, from $103.6 million in the same quarter of fiscal 2011.

For the Six Months Ended December 31, 2011 and 2010. Total interest income decreased by $4.6 million, or 15 percent, to $26.5 million for the first six months of fiscal 2012 from $31.1 million in the comparable period of fiscal 2011. This decrease was primarily the result of a lower average earning asset yield and, to a lesser extent, a lower average balance of earning assets. The average yield on earning assets during the first six months of fiscal 2012 was 4.20 percent, 50 basis points lower than the average yield of 4.70 percent during the same period of fiscal 2011. The average balance of earning assets decreased $61.4 million, or five percent, to $1.26 billion during the first six months of fiscal 2012 from $1.32 billion during the comparable period of fiscal 2011.

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