Southern Missouri Bancorp Inc. Reports Operating Results (10-Q)
SOUTHERN MO BANCORP INC. is a bank holding company. Southern Missouri Bancorp Inc. has a market cap of $20.88 million; its shares were traded at around $9.7501 with a P/E ratio of 6.6 and P/S ratio of 0.75. The dividend yield of Southern Missouri Bancorp Inc. stocks is 4.8%. Southern Missouri Bancorp Inc. had an annual average earning growth of 15.8% over the past 5 years. Highlight of Business Operations:During the first six months of fiscal 2009, we grew our balance sheet by $35.4 million; this above-trend growth was due to the leveraged use of $9.6 million in preferred capital invested by the U.S. Treasury Department under the terms of their Capital Purchase Program. This additional growth primarily reflected an $18.4 million increase in available-for-sale investments, an $8.2 million increase in total net loans, a $28.6 million increase in borrowed funds, and a $6.2 million decrease in deposits (the decrease was primarily due to public fund withdrawals, most of which was anticipated, and scheduled draws on bond proceeds). The growth in available-for-sale investments was primarily in the form of collateralized mortgage obligations (CMOs) and municipal bonds. The growth in loans was primarily due to commercial and commercial real estate loan growth. The increase in borrowed funds related to advances from the Federal Home Loan Bank (FHLB), and was used to fund investment and loan growth and offset deposit losses.
The Treasury Department created the Capital Purchase Program with the intention of building capital at U.S. financial institutions in order to increase the flow of financing to U.S. businesses and consumers, and to support the U.S. economy. As of December 31, 2008, the Company has contributed to the accomplishment of that objective by leveraging the Treasury s investment to increase loan balances by $8.2 million in the current fiscal year, and by $31.6 million over the last twelve months. Additionally, the Company has purchased $15 million in agency-backed collateralized mortgage obligations (CMOs) and $4.5 million in municipal debt since the Treasury investment was made, helping to improve the availability of credit in two distressed markets. These are investment purchases that the Company would not likely have made, absent the Treasury investment. Including both direct loans and investment securities, the Company has increased its investment in credit markets by $52.6 million over the last twelve months.
other-than-temporary impairment of the bank s investment in a trust preferred pool – a 122.2% increase in loan loss provisions, and an 11.6% increase in non-interest expense. Diluted earnings per share for the second quarter of fiscal 2009 were $0.40, as compared to $0.39 for the second quarter of fiscal 2008. For the first six months of fiscal 2008, net income increased 7.6% to $1.8 million, as compared to $1.7 million earned during the same period of the prior year. The increase in net income compared to the year-ago period was primarily due to a 27.9% increase in net interest income, partially offset by a 51.6% decrease in non-interest income – the result of charges to record the other-than-temporary impairment of Company investments – a 200% increase in loan loss provisions, and a 9.5% increase in non-interest expense. For both the second quarter and first six months of fiscal 2009, our increase in net interest income was due primarily to an increase in average interest rate spread, as well as an increase in average interest-earning assets.
The Company s total assets increased by $35.4 million, or 8.5%, to $453.3 million at December 31, 2008, as compared to $417.8 million at June 30, 2008. Available-for-sale investment balances increased by $18.4 million, or 46.1%, to $58.3 million, as compared to $39.9 million at June 30, 2008. This growth was attributed to the Company s leveraged use of the investment by the U.S. Treasury Department of $9.6 million under its Capital Purchase Program. Loans, net of the allowance for loan losses, increased $8.2 million, or 2.4%, to $351.2 million at December 31, 2008, as compared to $343.1 million at June 30, 2008. Commercial real estate loan balances grew by $3.7 million, while commercial loans were up $2.5 million, as the Company continues to focus on developing this business.
Asset growth during the first nine months of fiscal 2008 has been funded primarily with FHLB advances, which increased $28.6 million, or 44.7%, to $92.7 million at December 31, 2008, as compared to $64.1 million at June 30, 2008. Deposits decreased $6.2 million, or 2.1%, to $286.0 million at December 31, 2008, compared to $292.3 million at June 30, 2008. This reflected public unit deposit runoff of $13.7 million, partially offset by non-public deposit growth of $7.5 million. By account type, the decrease in deposits was due to a $13.2 million decrease in money market passbook savings and money market deposit accounts, a $3.6 million decrease in certificates of deposit, and a $2.8 million decrease in statement saving accounts, partially offset by checking account growth of $12.1 million, as the Company introduced a new, high-rate “rewards checking” product. Securities sold under agreements to repurchase totaled $25.5 million at December 31, 2008, an increase of $3.7 million, or 17.0%, compared to $21.8 million at June 30, 2008.
Total stockholders equity increased $9.8 million, or 32.1%, to $40.3 million at December 31, 2008, as compared to $30.5 million at June 30, 2008. The increase was primarily due to the $9.6 million investment in preferred equity by the U.S. Treasury Department under the terms of its Capital Purchase Program. Additionally, capital increased due to retention of net income, an increase in the market value of the Company s available-for-sale investment portfolio, and the exercise of stock options outstanding, partially offset by stock repurchases and cash dividends paid.
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