We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Register for Free to get streaming real-time quotes, interactive charts, live options flow, and more.
| Share Name | Share Symbol | Market | Type |
|---|---|---|---|
| Blackhawk Bancorp Inc (QX) | USOTC:BHWB | OTCMarkets | Common Stock |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 33.35 | 32.10 | 33.99 | 0.00 | 01:00:00 |
From Jul 2019 to Jul 2024
Blackhawk Bancorp, Inc. (OTCBB: BHWB) reports that its 2014 third quarter results include the recognition of a $2,611,000 impairment charge related to short-term securities, which were backed by loans and United States Department of Agriculture guarantees, that were found to be fraudulent. The after-tax loss recognized on these securities was $1,593,000 resulting in a net loss of $375,000 for the third quarter compared to net income of $980,000 earned in the third quarter of 2013. The net loss per diluted share for the quarter was $0.17, a $0.53 decrease compared to the $0.36 per diluted share earned the third quarter of last year.
The securities fraud loss caused year to date net income to drop to $1,308,000, a 37% decrease compared to net income of $2,076,000 for the first nine months of 2013. The earnings per diluted share for the nine months ended September 30, 2014 was $0.50, a $0.21 decrease compared to $0.71 per diluted share earned the first nine months of 2013.
“While the fraud loss was an isolated and unfortunate event, we are not letting it distract us from the growth and momentum we’ve achieved improving core earnings and credit quality”, said Rick Bastian, the Company’s chief executive officer. “Excluding the impairment charge, third quarter net income was up 24% to $1,218,000 and year to date net income was up 40% to $2,902,000. The after-tax impairment charge due to the fraud equaled $0.71 per diluted share. Excluding this charge, diluted earnings per share increased by 50% for the quarter and 69% year to date compared to 2013”, he added. “We’ve performed an extensive review of our processes and the due diligence surrounding the investments in question and found no breakdown in controls or warning signs that were missed. We recognized the impairment charge in the third quarter; however we do expect to ultimately recover a substantial portion of the loss in future periods”, said Bastian.
In addition, the Company’s Board of Directors has declared a cash dividend on the Company’s common stock. Shareholders of record on November 14, 2014 will be paid a dividend of $0.02 per share on November 29, 2014. This amounts to $0.08 per share on an annualized basis.
The following table summarizes key performance and asset quality measures for the quarter ended September 30, 2014 compared to the previous four quarters. The diluted earnings per share (Diluted EPS), return on average assets (ROAA), and return on average common equity (ROACE) are each presented based on actual results and the results, excluding after tax impact of the securities fraud.
3rd Qtr
2nd Qtr
1st Qtr
4th Qtr
3rd Qtr
Key Performance and Asset Quality Measures 2014 2014 2014 2013 2013 Diluted EPS ($0.17) $0.42 $0.24 $0.75 $0.36 Diluted EPS, excluding net securities fraud loss $0.54 $0.42 $0.24 $0.75 $0.36 ROAA (.25%) .67% .49% 1.25% .67% ROAA, excluding net securities fraud loss .81% .67% .49% 1.25% .67% ROACE (3.55%) 9.37% 5.70% 17.47% 8.95% ROACE, excluding net securities fraud loss 11.53% 9.37% 5.70% 17.47% 8.95% Efficiency Ratio* 71.2% 69.3% 78.3% 76.2% 72.4% Net interest margin 3.66% 3.60% 3.70% 3.79% 3.69% Nonaccrual loans to total loans 1.53% 1.38% 1.49% 1.63% 1.97% Nonaccrual loans and OREO to total loans 1.79% 1.72% 1.89% 2.11% 2.75% Allowance for loan losses to total loans 1.12% 1.14% 1.26% 1.26% 1.58% Allowance for loan losses to nonaccrual loans 73.1% 82.7% 84.7% 77.5% 82.3% Subsidiary bank total risk-based capital 13.27% 13.94% 13.80% 13.51% 13.46%* - The efficiency ratio calculation excludes net gains and losses on trading and available for sale securities, net gains and losses on other assets and the securities fraud loss.
The short-term securities, which incurred the impairment, were purchased through an arrangement with Pennant Management, Inc., a Milwaukee based investment advisor, as safe short-term investments, backed by loans and guarantees of the United States Department of Agriculture (USDA). Blackhawk has a twelve year history with Pennant, a recognized leader in dealing with government guaranteed loans and securities, and has participated in similar arrangements over the entire term of the relationship. The fraudulent activity was committed by a USDA approved lender with whom Pennant, on behalf of its clients, had entered into an agreement to purchase USDA guaranteed loans. It was discovered that the underlying loans and the USDA guarantees on 25 loans totaling approximately $176 million were fraudulent. Blackhawk had a $5.5 million interest in the underlying loans and USDA guarantees. The amount of the loss was mitigated by recovery efforts that resulted in a court approved agreement identifying and seizing assets that are to be liquidated for the benefit of investors. While the amount and timing of additional recoveries is uncertain, Blackhawk expects the recoveries in future periods to be substantial. Additional recovery is being sought from a number of sources including, but not limited to: claims being made on the USDA to honor their guarantees, continued seizure of assets from the perpetrator of the fraud, a potential claim on Blackhawk’s insurance, and the exercise of any other legal rights and remedies that may be available to Blackhawk.
Net Interest Income
Net interest income for the third quarter increased by 2% to $4,932,000 compared to $4,848,000 for the third quarter of 2013 with the net interest margin decreasing 3 basis points to 3.66% compared to 3.69% the third quarter last year.
Average total earning assets for the quarter increased by $13.1 million to $552.6 million compared to $539.5 million in the third quarter of 2013. The growth in earning assets includes an $11.8 million, or 3%, increase in average total loans. Average total deposits for the third quarter increased by $2.3 million to $507.9 million compared to $505.5 million the third quarter of last year. A $7.3 million, or 8%, increase in average demand deposits was offset by a decrease in time deposits.
Net interest income for the first three quarters of the year increased $94,000, or 1%, to $14,463,000 compared to $14,369,000 prior year. The net interest margin for the first nine months was $3.65%, down 5 basis points compared to the first nine months of last year.
Year to date average total earning assets increased $12.0 million to $547.5 million compared to $535.5 million for the first nine months of 2013. The increase was driven by a $14.8 million increase in average loans. Total average deposits increased by $10.4 million with $7.0 million of the growth occurring in demand deposits.
Provision for Loan Losses and Credit Quality
The provision for loan losses in the third quarter dropped by $98,000, or 20%, to $578,000 compared to $480,000 in third quarter of 2013. The provision for the nine months ended September 30, 2014 was $1,768,000, 50% less than the $3,540,000 provision recorded the first nine months of 2013.
Nonaccrual loans and other real estate owned totaled $7.0 million, or 1.79% of total loans, at September 30, 2014 compared to $8.1 million, or 2.10% of total loans, at December 31, 2013 and $10.4 million, or 2.68% of total loans, at September 30, 2013.
Net loan charge-offs for the first nine months of 2014 decreased by 42% to $2,276,000 compared to $3,930,000 the first three quarters of 2013. The following table summarizes the activity in the allowance for loan losses for the nine months ended September 30, 2014 and 2013 and the year ended December 31, 2013:
Nine Months Ended Year Ended September 30, December 31, (in Thousands) 2014 2013 2013 Beginning allowance for loan losses 4,894 6,520 6,520 Provision for loan losses 1,769 3,540 4,140 Charge-offs (2,556) (4,695) (6,590) Recoveries 280 765 824 Ending allowance for loan losses 4,387 6,130 4,894Net charge-offs to average total loans
0.80% 1.43%1.55%
Non-Interest Income and Operating Expenses
Excluding the impairment charge on short-term securities, non-interest income for the third quarter of 2014 increased by 12% to $2,448,000 compared to $2,191,000 the third quarter of the prior year. The increase in non-interest income was driven by a $361,000 increase in net other gains (losses), primarily related to sale of assets acquired in foreclosure.
Excluding the impairment charge on short-term securities, non-interest income for the first nine months of the year totaled $6,393,000, a 14% decrease compared to $7,391,000 the nine months of 2013. The decrease reflects the slow- down in mortgage refinance activity. Revenue from the sale and servicing of secondary market mortgages dropped by $834,000 to $1,483,000 compared to $2,317,000 the first nine months last year.
Operating expenses for the third quarter decreased by $219,000, or 4%, to $5,147,000 compared to $5,366,000 the third quarter of last year. Year to date operating expenses are down $661,000, or 4%, to $15,416,000 compared to $16,077,000 the first three quarters of 2013.
Outlook
Blackhawk has created a strong credit culture and the processes to support it; however, economic uncertainties and depressed real estate values have resulted in an elevated level of losses and nonperforming loans. While the level of nonperforming loans has been decreasing and should result in improved earnings, the potential for continuing economic weakness presents a heightened level of risk. For that reason, the company expects to continue fortifying its balance sheet by conserving capital, strengthening the allowance for loan losses and maintaining ample liquidity to meet the demands of its customer base. The company will however continue to seek profitable growth opportunities in its Wisconsin and Illinois markets, without sacrificing profitability or credit quality. Blackhawk emphasizes the value of its personal attention and the service it provides that remain unmatched by larger competitors.
About Blackhawk Bancorp
Blackhawk Bancorp, Inc. is headquartered in Beloit, Wisconsin and is the parent company of Blackhawk Bank, which operates eight banking centers in south central Wisconsin and north central Illinois, along the I-90 corridor from Belvidere, Illinois to Janesville, Wisconsin. Blackhawk’s locations serve individuals and small businesses, primarily with fewer than 200 employees. The company offers a variety of value-added consultative services to small businesses and their employees related to its banking products such as health savings accounts and investment management.
Forward-Looking Statements
When used in this communication, the words “believes,” “expects,” and similar expressions are intended to identify forward-looking statements. The company’s actual results may differ materially from those described in the forward-looking statements. Factors which could cause such a variance to occur include, but are not limited to: heightened competition; adverse state and federal regulation; failure to obtain new or retain existing customers; ability to attract and retain key executives and personnel; changes in interest rates; unanticipated changes in industry trends; unanticipated changes in credit quality and risk factors, including general economic conditions; success in gaining regulatory approvals when required; changes in the Federal Reserve Board monetary policies; unexpected outcomes of new and existing litigation in which Blackhawk or its subsidiaries, officers, directors or employees is named defendants; technological changes; changes in accounting principles generally accepted in the United States; changes in assumptions or conditions affecting the application of “critical accounting policies”; inability to recover previously recorded losses as anticipated, and the inability of third party vendors to perform critical services for the company or its customers.
Further information is available on the Company’s website at www.blackhawkbank.com.
BLACKHAWK BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2014 AND DECEMBER 31, 2013 (UNAUDITED) September 30, December 31, Assets 2014 2013 (Amounts in thousands, except share and per share data) Cash and due from banks $ 13,233 $ 11,350 Federal funds sold and securities purchased under agreements to resell 8,453 21,064 Interest-bearing deposits in banks 4,525 2,078 Total cash and cash equivalents 26,211 34,492 Trading securities 79 315 Securities available-for-sale 144,077 127,985 Loans held for sale 1,791 1,161 Federal Home Loan Bank stock, at cost 2,266 2,266Loans, less allowance for loan losses of $4,387 and $4,894 at September 30, 2014 and December 31, 2013, respectively
387,454 382,295 Office buildings and equipment, net 8,656 8,922 Goodwill 5,037 5,037 Other intangible assets, net 2,732 3,091 Cash surrender value of bank-owned life insurance 9,532 9,311 Other assets 10,762 8,565 Total assets $ 598,597 $ 583,440 Liabilities and Stockholders' Equity Liabilities Deposits: Noninterest-bearing $ 97,768 $ 91,450 Interest-bearing 418,716 419,308 Total deposits 516,484 510,758Borrowings (including $0 and $2,157 at fair value at September 30, 2014 and December 31, 2013, respectively)
25,500 10,157Subordinated debentures and notes (including $1,031 at fair value at September 30, 2014 and December 31, 2013)
11,255 11,255 Other liabilities 4,353 2,968 Total liabilities 557,592 535,138 Stockholders’ equityPreferred stock, $0.01 par value, 1,000,000 shares authorized;
0 and 10,500 shares issued as of September 30, 2014 and December 31, 2013, respectively
- 10,483 Common stock, $0.01 par value, 10,000,000 shares authorized;2,316,397 and 2,299,496 shares issued as of September 30, 2014 and December 31, 2013, respectively
23 23 Surplus 9,909 9,768 Retained earnings 30,191 29,166Treasury stock, 87,865 and 83,252 shares at cost as of September 30, 2014 and December 31, 2013, respectively
(969 ) (909 ) Accumulated other comprehensive income (loss) 1,851 (229 ) Total stockholders' equity 41,005 48,302 Total liabilities and stockholders' equity $ 598,597 $ 583,440 BLACKHAWK BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) Three months ended September 30, 2014 2013 (Amounts in thousands, except share and per share data) Interest Income: Interest and fees on loans $ 4,732 $ 4,757 Interest on trading securities 4 11 Interest and dividends on securities: Taxable 591 445 Tax-exempt 325 337 Interest on federal funds sold and securities purchased under agreements to resell 45 83 Interest on interest-bearing deposits in banks 1 2 Total interest and dividend income 5,698 5,635 Interest Expenses: Interest on deposits 518 602 Interest on borrowings 96 33 Interest on subordinated debentures 152 152 Total interest expense 766 787 Net interest and dividend income 4,932 4,848 Provision for loan losses 578 480 Net interest and dividend income after provision for loan losses 4,354 4,368 Noninterest Income: Service charges on deposits accounts 741 760 Net gain on sale of loans 516 613 Net mortgage servicing income 72 17 Debit card interchange fees 561 564 Net gains (losses) on trading activities (3 ) 33 Net gains (losses) on available-for-sale securities 214 27 Net other gains (losses) (2,512 ) (262 ) Increase in cash value of bank-owned life insurance 71 74 Other 176 365 Total noninterest income (164 ) 2,191 Noninterest Expenses: Salaries and employee benefits 2,845 2,840 Occupancy and equipment 632 651 Data processing 579 587 Advertising and marketing 55 54 Amortization of intangibles - 35 Professional fees 235 305 Office Supplies 108 100 Telephone 98 93 Other 594 701 Total noninterest expenses 5,146 5,366 Income before income taxes (956 ) 1,193 Provision for income taxes (581 ) 213 Net income $ (375 ) $ 980 Key Ratios Basic Earnings Per Common Share $ (0.17 ) $ 0.37 Diluted Earnings Per Common Share (0.17 ) 0.36 BLACKHAWK BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) Nine months ended September 30, 2014 2013 (Amounts in thousands, except share and per share data) Interest Income: Interest and fees on loans $ 13,946 $ 14,163 Interest on trading securities 12 38 Interest and dividends on available-for-sale securities: Taxable 1,578 1,501 Tax-exempt 994 916 Interest on federal funds sold and securities purchased under agreements to resell 154 292 Interest on interest-bearing deposits in banks 3 6 Total interest and dividend income 16,687 16,916 Interest Expense: Interest on deposits 1,578 2,006 Interest on borrowings 191 180 Interest on subordinated debentures and notes 456 361 Total interest expense 2,225 2,547 Net interest and dividend income before provision for loan losses 14,462 14,369 Provision for loan losses 1,769 3,540 Net interest and dividend income after provision for loan losses 12,693 10,829 Noninterest Income: Service charges on deposits accounts 2,100 2,099 Net gain on sale of loans 1,291 2,353 Net loan servicing income (loss) 192 (36 ) Debit card interchange fees 1,680 1,687 Net gains (losses) on trading activities 4 40 Net gains (losses) on available-for-sale securities 469 614 Net other gains (losses) (2,883 ) (282 ) Increase in cash surrender value of bank-owned life insurance 221 224 Other 681 692 Total noninterest income 3,755 7,391 Noninterest Expenses: Salaries and employee benefits 8,436 8,419 Occupancy and equipment 1,903 1,956 Data processing 1,757 1,769 Advertising and marketing 167 205 Amortization of intangibles 25 104 Professional fees 688 880 Office Supplies 285 278 Telephone 280 278 Other 1,848 2,188 Total noninterest expenses 15,389 16,077 Income before income taxes 1,059 2,143 Provision for income taxes (249 ) 67 Net income $ 1,308 $ 2,076 Key Ratios Basic Earnings Per Common Share $ 0.50 $ 0.72 Diluted Earnings Per Common Share 0.50 0.71 BLACKHAWK BANCORP, INC. AND SUBSIDIARIES AVERAGE BALANCE SHEET WITH RESULTANT INTEREST AND RATES Average Balance Sheet with Resultant Interest and Rates (Amounts in thousands) (yields on a tax-equivalent basis) Three months ended September 30, 2014 Three months ended September 30, 2013 Average Average Average AverageBalance
Interest
Rate
Balance
Interest
Rate
Interest Earning Assets: Interest-bearing deposits in banks $ 1,973 $ 1 0.14 % $ 3,362 $ 2 0.24 %Federal funds sold & securities purchased under agreements to resell
12,693 45 1.39 % 28,636 83 1.15 % Investment securities: Taxable investment securities 113,325 595 2.08 % 94,436 456 1.91 % Tax-exempt investment securities 38,623 325 5.02 % 38,982 337 5.17 % Total Investment securities 151,948 920 2.83 % 133,418 793 2.86 % Loans 385,923 4,732 4.86 % 374,124 4,757 5.04 % Total Earning Assets $ 552,537 $ 5,698 4.21 % $ 539,540 $ 5,635 4.27 % Allowance for loan losses (4,310 ) (7,005 ) Cash and due from banks 13,129 12,653 Other assets 32,914 37,594 Total Assets $ 594,270 $ 582,782 Interest Bearing Liabilities: Interest bearing checking accounts $ 167,651 $ 118 0.28 % $ 165,199 $ 130 0.31 % Savings and money market deposits 143,616 54 0.15 % 147,445 52 0.14 % Time deposits 102,407 346 1.34 % 105,977 420 1.57 % Total interest bearing deposits 413,674 518 0.50 % 418,621 602 0.57 % Subordinated debentures 11,255 152 5.37 % 10,876 152 5.56 % Borrowings 20,084 96 1.90 % 12,784 33 1.01 % Total Interest-Bearing Liabilities $ 445,013 $ 766 0.68 % $ 442,281 $ 787 0.71 % Interest Rate Spread 3.53 % 3.56 % Noninterest checking accounts 94,177 86,890 Other liabilities 13,180 6,368 Total liabilities 552,370 535,539 Preferred Stock - 10,442 Common Stockholders' equity 41,900 36,801 Total Stockholders' equity 41,900 47,243Total Liabilities and Stockholders' Equity
$ 594,270 $ 582,782 Net Interest Income/Margin $ 4,932 3.66 % $ 4,848 3.69 % BLACKHAWK BANCORP, INC. AND SUBSIDIARIES AVERAGE BALANCE SHEET WITH RESULTANT INTEREST AND RATES Average Balance Sheet with Resultant Interest and Rates (Amounts in thousands) (Yields on a tax-equivalent basis) Nine months ended September 30, 2014 Nine months ended September 30, 2013 Average Average Average AverageBalance
Interest
Rate
Balance
Interest
Rate
Interest Earning Assets: Interest-bearing deposits in banks $ 2,667 $ 3 0.16 % $ 3,450 $ 6 0.23 %Federal funds sold & securities purchased under agreements to resell
15,179 154 1.36 % 32,581 292 1.20 % Investment securities: Taxable investment securities 109,125 1,590 1.95 % 97,308 1,539 2.11 % Tax-exempt investment securities 39,116 994 5.11 % 35,567 916 5.18 % Total Investment securities 148,241 2,584 2.78 % 132,875 2,455 2.94 % Loans 381,395 13,946 4.89 % 366,582 14,163 5.17 % Total Earning Assets $ 547,482 $ 16,687 4.20 % $ 535,488 $ 16,916 4.34 % Allowance for loan losses (4,652 ) (6,587 ) Cash and due from banks 12,932 13,078 Other assets 33,531 36,334 Total Assets $ 589,293 $ 578,313 Interest Bearing Liabilities: Interest bearing checking accounts $ 164,331 $ 354 0.29 % $ 162,178 $ 542 0.45 % Savings and money market deposits 152,495 164 0.14 % 148,382 173 0.16 % Time deposits 103,216 1,060 1.37 % 106,078 1,291 1.63 % Total interest bearing deposits 420,042 1,578 0.50 % 416,638 2,006 0.64 % Subordinated debentures and notes 11,180 456 5.46 % 9,300 361 5.18 % Borrowings 16,144 191 1.58 % 14,093 180 1.70 % Total Interest-Bearing Liabilities $ 447,366 $ 2,225 0.66 % $ 440,031 $ 2,547 0.77 % Interest Rate Spread 3.54 % 3.57 % Noninterest checking accounts 93,684 86,686 Other liabilities 3,378 3,017 Total liabilities 544,428 529,734 Preferred Stock 4,382 10,417 Common Stockholders' equity 40,483 38,162 Total Stockholders' equity 44,865 48,579Total Liabilities and Stockholders' Equity
$ 589,293 $ 578,313 Net Interest Income/Margin $ 14,462 3.65 % $ 14,369 3.70 %
For further information:Blackhawk Bancorp, Inc.R. Richard Bastian, III, CEOrbastian@blackhawkbank.comorTodd J. James, EVP & CFOtjames@blackhawkbank.comPhone: (608) 364-8911
1 Year Blackhawk Bancorp (QX) Chart |
1 Month Blackhawk Bancorp (QX) Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
Hot Features
Premium
