ALASKA PACIFIC BANCSHARES, INC. 
By Alaska Pacific Bancshares, Inc. (OTCBB:AKPB) ("Company"), the parent company of Alaska Pacific Bank ("Bank"), today reported net income available to common shareholders of $97,000, or $0.13 per diluted common share, for the first quarter ended March 31, 2012, as compared to net income available to common shareholders of $67,000, or $0.09 per diluted common share for the first quarter of 2011.
"Everyone at the Bank is pleased with the progress we have made during the first quarter of 2012 and is looking forward to the remainder of the year. Our mortgage department is fully staffed and you can see by the increase in first quarter performance that the lending team has done a great job in the mortgage area," stated Craig Dahl, President and CEO. "During the first quarter of 2012 we had solid growth in the commercial business loan portfolio and are continuing to see a steady increase in residential construction and business activity over the past two years. While we still have a higher than desired level of classified assets, which is attributable to the same small number of loans that are working through the process of collection or restructuring, the Bank continues to have very low delinquency rate and we have continued to focus on our retail business."
The provision for loan losses was $90,000 and $60,000 for the quarters ended March 31, 2012 and 2011, respectively. The allowance for loan losses at March 31, 2012 was $1.9 million, representing 1.28% of total loans outstanding. Total non-accrual loans were $2.6 million at both March 31, 2012 and December 31, 2011 and $624,000 at March 31, 2011. In addition, the Bank's real estate owned and repossessed assets were $754,000 at March 31, 2012 compared with $880,000 at December 31, 2011 and $1.2 million at March 31, 2011. There was $36,000 in net loan charge offs for the quarter ended March 31, 2012 compared with $234,000 net loan charge offs for the quarter ended December 31, 2011 and net loan recoveries of $227,000 for the quarter ended March 31, 2011.
Net interest income was $1.9 million for both the first quarter of 2012 and for the first quarter of 2011. Net interest margin on average interest-earning assets for the first quarter of 2012 was 4.93% compared with 5.04% in the first quarter of 2011.
Loans (excluding loans held for sale and before the allowance for loan losses) were $149.4 million at March 31, 2012, an increase of $1.6 million, or 1.1% from $147.8 million at December 31, 2011, and an increase of $5.4 million, or 3.8% from $144.0 million at March 31, 2011. Deposits at March 31, 2012, were $140.6 million, a $6.6 million, or 4.5% decrease from $147.2 million at December 31, 2011, and a $1.3 million, or 0.9% decrease from $141.9 million at March 31, 2011.
Gain on sale of loans increased $60,000 to $110,000 for the first quarter of 2012 from $50,000 for first quarter of 2011 as a result of an increase in mortgage loans originated for sale. Excluding mortgage banking income, noninterest income increased $11,000, or 3.8%, to $303,000 for the first quarter of 2012 compared with $292,000 for the first quarter 2011.
Noninterest expense for the first quarter of 2012 increased $46,000, or 2.4%, to $2.0 million from $1.9 million for the quarter ended December 31, 2011 and decreased $99,000, or 4.8%, from the quarter ended March 31, 2011. The net increase in expense in the first quarter of 2012 compared to the fourth quarter of 2011 is attributable to higher compensation and benefit expense, and professional and consulting expense.
Forward-Looking Statements
Certain matters in this news release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to, among other things, expectations of the business environment in which we operate, projections of future performance, perceived opportunities in the market, potential future credit experience, and statements regarding our mission and vision. These forward-looking statements are based upon current management expectations, and may, therefore, involve risks and uncertainties. Our actual results, performance, or achievements may differ materially from those suggested, expressed, or implied by forward-looking statements as a result of a wide variety or range of factors including, but not limited to: the credit risks of lending activities, including changes in the level and trend of loan delinquencies and write-offs that may be impacted by deterioration in the housing and commercial real estate markets and may lead to increased losses and non-performing assets in our loan portfolio, result in our allowance for loan losses not being adequate to cover actual losses, and require us to materially increase our reserves; changes in general economic conditions, either nationally or in our market areas; changes in the levels of general interest rates, and the relative differences between short and long term interest rates, deposit interest rates, our net interest margin and funding sources; deposit flows; fluctuations in the demand for loans, the number of unsold homes and other properties and fluctuations in real estate values in our market areas; adverse changes in the securities markets; results of examinations by our banking regulators including the possibility that any such regulatory authority may, among other things, require us to increase our reserve for loan losses, write-down assets, change our regulatory capital position or affect our ability to borrow funds or maintain or increase deposits, which could adversely affect our liquidity and earnings; the possibility that we will be unable to comply with the conditions imposed upon us in the Cease and Desist Orders entered into with the Office of Thrift Supervision that are now enforced by its successors the Office of the Comptroller of the Currency for the Bank and the Federal Reserve for the Company; computer systems on which we depend could fail or experience a security breach, or the implementation of new technologies may not be successful; our ability to retain key members of our senior management team; legislative or regulatory changes such as the Dodd-Frank Wall Street Reform and Consumer Protection Act that adversely affect our business including changes in regulatory policies and principles, and the interpretation of regulatory capital or other rules; the time it may take to lease excess space in Company-owned buildings; future legislative changes in the United States Department of Treasury Troubled Asset Relief Program Capital Purchase Program; and other risks detailed in our reports filed with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the fiscal year ended December 31, 2011. Accordingly, these factors should be considered in evaluating forward-looking statements, and undue reliance should not be placed on such statements. We undertake no responsibility to update or revise any forward-looking statements.
Alaska Pacific Bancshares, Inc. | ||||||||||||
| Three Months Ended | ||||||||||||
|
March 31, 2012 |
December 31, 2011 |
March 31, 2011 | ||||||||||
| Condensed Statement of Income: | ||||||||||||
| Interest income | $ | 2,090 | $ | 2,142 | $ | 2,142 | ||||||
| Interest expense | 147 | 157 | 201 | |||||||||
| Net interest income | 1,943 | 1,985 | 1,941 | |||||||||
| Provision for loan losses | 90 | 60 | 60 | |||||||||
| Gain on sale of loans | 110 | 69 | 50 | |||||||||
| Other noninterest income | 303 | 174 | 292 | |||||||||
| Noninterest expense | 1,979 | 1,933 | 2,078 | |||||||||
| Net income before income tax benefit | 287 | 235 | 145 | |||||||||
| Provision for income tax | 113 | - | - | |||||||||
| Net income | 174 | 235 | 145 | |||||||||
| Preferred stock dividend and discount accretion | ||||||||||||
| Preferred stock dividend | 60 | 60 | 62 | |||||||||
| Preferred stock discount accretion | 17 | 18 | 16 | |||||||||
| Net income available to common shareholders | $ | 97 | $ | 157 | $ | 67 | ||||||
| Income per common share: | ||||||||||||
| Basic | $ | 0.15 | $ | 0.24 | $ | 0.10 | ||||||
| Diluted | $ | 0.13 | $ | 0.22 | $ | 0.09 | ||||||
| Performance Ratios: | ||||||||||||
| Return on average equity | 3.38 | % | 4.60 | % | 2.93 | % | ||||||
| Return on average assets | 0.45 | 0.58 | 0.37 | |||||||||
| Yield on average interest-earning assets | 5.31 | 5.53 | 5.56 | |||||||||
| Cost of average interest-bearing liabilities | 0.51 | 0.53 | 0.68 | |||||||||
| Interest rate spread | 4.80 | 5.00 | 4.88 | |||||||||
| Net interest margin on: | ||||||||||||
| Average interest-earning assets | 4.93 | 5.13 | 5.04 | |||||||||
| Average total assets | 4.98 | 4.89 | 4.89 | |||||||||
| Efficiency ratio (a) | 88.11 | 89.53 | 93.06 | |||||||||
| Average balances: | ||||||||||||
| Loans | $ | 149,000 | $ | 144,743 | $ | 143,884 | ||||||
| Interest-earning assets | 157,553 | 154,806 | 154,073 | |||||||||
| Assets | 156,099 | 162,238 | 158,865 | |||||||||
| Interest-bearing deposits | 112,809 | 116,369 | 114,155 | |||||||||
| Total deposits | 141,673 | 148,977 | 142,985 | |||||||||
| Interest-bearing liabilities | 116,060 | 119,369 | 119,003 | |||||||||
| Shareholders' equity | 20,604 | 20,452 | 19,810 | |||||||||
| Weighted average common shares outstanding: | ||||||||||||
| Basic | 654,486 | 654,486 | 654,486 | |||||||||
| Diluted | 720,915 | 714,862 | 723,849 | |||||||||
March 31, |
December 31, |
March 31, | ||||||||||
| Balance sheet data: | ||||||||||||
| Total assets | $ | 166,881 | $ | 172,057 | $ | 167,561 | ||||||
| Loans, before allowance | 149,441 | 147,766 | 144,035 | |||||||||
| Loans held for sale | 162 | 976 | 4,904 | |||||||||
| Investment securities available for sale | 5,836 | 5,714 | 4,981 | |||||||||
| Total deposits | 140,599 | 147,201 | 141,882 | |||||||||
| Federal Home Loan Bank advances | 3,500 | 3,000 | 3,500 | |||||||||
| Shareholders' equity | 20,666 | 20,542 | 19,843 | |||||||||
| Shares outstanding (b) | 654,486 | 654,486 | 654,486 | |||||||||
| Book value per share | $ | 24.27 | $ | 24.08 | $ | 23.01 | ||||||
| Asset quality: | ||||||||||||
| Allowance for loan losses | $ | 1,919 | $ | 1,865 | $ | 1,870 | ||||||
| Allowance as a percent of loans | 1.28 | % | 1.26 | % | 1.30 | % | ||||||
| Nonaccrual loans | $ | 2,607 | $ | 2,645 | $ | 624 | ||||||
| Total nonperforming assets | 3,361 | 3,525 | 1,813 | |||||||||
| Impaired loans | 11,938 | 11,980 | 11,287 | |||||||||
| Estimated specific reserves for impairment | 473 | 473 | 310 | |||||||||
| Net charge offs (recoveries) for quarter | 36 | 234 | (227 | ) | ||||||||
| Net charge offs (recoveries) YTD | 36 | 91 | (227 | ) | ||||||||
| Real estate owned and repossessed assets | 754 | 880 | 1,189 | |||||||||
(a) Noninterest expense, divided by the sum of net interest income and noninterest income, excluding gains on sale of loans or securities.
(b) Excludes treasury stock.
Alaska Pacific Bancshares, Inc.
Senior Vice President and CFO
Julie
M. Pierce, 907-790-5135
or
President and CEO
Craig E.
Dahl, 907-790-5101
