Citizens Community Bancorp Inc. Reports Operating Results (10-Q)

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May 11, 2009
Citizens Community Bancorp Inc. (CZWI, Financial) filed Quarterly Report for the period ended 2009-03-31.

Citizens Community Bancorp Inc. has a market cap of $40.4 million; its shares were traded at around $5.76 with a P/E ratio of 29.4. The dividend yield of Citizens Community Bancorp Inc. stocks is 3.3%.

Highlight of Business Operations:

Total Assets. Total Company assets as of March 31, 2009, were $507.5 million, compared with $480.0 million as of September 30, 2008, and $487.6 million as of December 31, 2008, a fiscal year-to-date increase of $27.5 million, or 5.7 percent. The gain was primarily due to a $30.8 million increase in loans receivable—of which, $24.1 million were generated through the Company s new Walmart in-store branches. This was partially offset by decreases in cash and cash equivalents to help fund new loan demand.

Loans Receivable. Loans increased by $30.8 million, or 8.3 percent, to $400.5 million as of March 31, 2009, from $369.7 million as of September 30, 2008, and $383.6 million as of December 31, 2008. At March 31, 2009, the loan portfolio was comprised of $220.7 million of loans secured by real estate, or 55.1 percent of total loans, and $179.7 million of consumer loans, or 44.9 percent of total loans. Of the $30.8 increase in loans receivable, $24.1 million was originated through the Company s Walmart in-store branches.

Deposits. Deposits grew to $342.2 million at March 31, 2009, from $297.2 million at September 30, 2008, and $315.7 million at December 31, 2008. The increase for the six-month period of $45.0 million was primarily a result of core deposit growth (which includes all deposits excluding CDs) from the Company s Walmart supercenter in-store branch locations combined with CD growth. $35.2 million of the deposit growth came from the Company s Walmart supercenter branch locations; of that, $25.0 million was core deposit growth.

Total Interest and Dividend Income. Total interest income increased by $1.1 million to $7.5 million for the three-month period ended March 31, 2009, from $6.4 million for the same period in 2008. Total interest income increased by $2.1 million to $14.8 million for the six-month period, from $12.7 million for the prior year six-month period. The increase for both periods was largely a result of an increase in the average balance of loans receivable from strong loan demand due to marketing efforts at the Walmart in-store branch office, partially offset by a decline in earning asset yield as a result of declining market rates. The average balance of loans receivable increased from $339.0 million for the prior fiscal year second quarter to $391.4 million for the current year second quarter. The average balance of loans receivable increased from $333.8 million to $384.2 million for the six-month prior year period compared to the current six-month period. The yield on average loans receivable decreased from 6.70 percent to 6.68 percent for the three-month period ended March 31, 2008, and 2009, respectively. For the six-month periods, the yield on the average loans receivable decreased from 6.71 percent to 6.69 percent ended March 31, 2008, and 2009, respectively.

Total Interest Expense. Total interest expense increased $237,000 to $3.7 million for the quarter ended March 31, 2009, from $3.5 million for the prior year period. For the current six-month period, interest expense increased $700,000 to $7.5 million, from $6.8 million for the prior year six-month period. The increase for both periods was the result of an increase in the average balance of deposits, partially offset by a decline in the rates paid as a result of declining market rates. The average balance of interest-bearing liabilities increased from $339.3 million for the prior year three-month period ended March 31, 2008 to $430.6 million for the current three-month period. The average balance of interest- bearing liabilities increased from $328.7 million for the prior year six-month period to $422.8 million for the current six-month period.

Net Interest Income. Net interest income before provision for loan losses increased by $783,000, to $3.8 million for the three-month period ended March 31, 2009, compared to $3.0 million for the prior year three-month period. Net interest income increased by $1.4 million to $7.3 million from $5.9 million for the six-month periods ended March 31, 2009 and 2008, respectively. Largely responsible for the increase in both periods was a rise in the average balance of interest-earning assets, partially offset by a rise in the average balance of interest-bearing liabilities, combined with an increase in the net interest spread as a result of the cost of interest-bearing liabilities declining at a faster pace than the earnings yield of interest-earning assets discussed earlier.

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