Hingham Institution for Savings Reports Record Annual Earnings

Business Wire

HINGHAM, Mass.--(BUSINESS WIRE)--

HINGHAM INSTITUTION FOR SAVINGS (HIFS), Hingham, Massachusetts announced its earnings for 2013. Net income for the year ended December 31, 2013 was $13,371,000 or $6.28 per share (basic and diluted) as compared to $13,290,000 or $6.25 per share (basic and diluted) for 2012. Net income for the fourth quarter 2013 was $3,488,000 or $1.64 per share (basic and diluted) as compared to $3,354,000 or $1.58 per share (basic and diluted) for the fourth quarter 2012. The Bank’s return on average equity for the year ended December 31, 2013 was 13.52%, and the return on average assets was 1.07%.

Deposits increased by $71.0 million, or 8%, net loans increased by $129.2 million, or 14%, and total assets increased by 12% from December 31, 2012 to December 31, 2013. Total assets were $1,356,441,000 at December 31, 2013 as compared to $1,205,884,000 at December 31, 2012. Book value per share increased to $48.49 per share at December 31, 2013 from $43.65 per share at December 31, 2012. At December 31, 2013, non-performing assets totaled 0.46% of total assets compared to 0.28% of total assets at December 31, 2012.

President Robert H. Gaughen, Jr. stated, “We are pleased to report our sixth consecutive year of record earnings. Although the current interest rate environment has continued to put pressure on our net interest margin, the strong growth of our balance sheet, effective cost control and aggressive management of asset quality have again produced some of the industry’s strongest returns. We remain focused on increasing shareholder value through the continued development of a truly outstanding community banking organization.”

Hingham Institution for Savings is a Massachusetts-chartered savings bank located in Hingham, Massachusetts. Incorporated in 1834, it is the oldest financial institution headquartered in Hingham and one of the oldest in the Commonwealth. The Bank’s main offices are located on Main Street, Hingham, Massachusetts 02043, phone (781) 749-2200. The Bank also maintains branch offices in South Hingham and the neighboring towns of Cohasset, Hull, Scituate, Norwell, Weymouth as well as branches in the South End of Boston, Beacon Hill and the island of Nantucket.

The Bank’s shares of common stock are listed and traded on The NASDAQ Stock Market under the symbol HIFS.

                   
HINGHAM INSTITUTION FOR SAVINGS
Selected Financial Ratios
 
 
 

Three Months Ended

Twelve Months Ended
December 31, December 31,
2013   2012 2013   2012
(Unaudited)
 
Key Performance Ratios
Return on average assets (1) 1.06 % 1.11 % 1.07 % 1.15 %
Return on average equity (1) 13.62 14.58 13.52 15.05
Interest rate spread (1) (2) 3.03 3.15 3.07 3.25
Net interest margin (1) (3) 3.14 3.28 3.19 3.38
Non-interest expense to average assets (1) 1.37 1.41 1.40 1.42
Efficiency ratio (4) 43.06 42.28 43.26 41.54
Average equity to average assets 7.75 7.61 7.89 7.62
Average interest-bearing assets to average interest

bearing liabilities

113.93

113.33

113.92

112.75

 
   
December 31, December 31,
2013 2012
(Unaudited)
 
Asset Quality Ratios
Allowance for loan losses/total loans 0.78 % 0.84 %
Allowance for loan losses/non-performing loans 143.37 273.66
 
Non-performing loans/total loans 0.55 0.31
Non-performing loans/total assets 0.44 0.24
Non-performing assets/total assets 0.46 0.28
 
Share Related
Book value per share $ 48.49 $ 43.65
Market value per share $ 78.49 $ 62.60
Shares outstanding at end of period 2,128,750 2,125,750
 
 

(1) Annualized

 

(2) Interest rate spread represents the difference between the yield on earning assets and cost of interest-bearing liabilities.

 
(3) Net interest margin represents net interest income divided by average earning assets.
 

(4) The efficiency ratio represents non-interest expense, divided by the sum of net interest income and non-interest income.

 
       

HINGHAM INSTITUTION FOR SAVINGS

Consolidated Balance Sheets

 
 
 
December 31, December 31,

(Dollars in thousands except per share data)

2013   2012
(Unaudited)
ASSETS
 
Cash and due from banks $ 11,922 $ 7,961
Short-term investments 90,925   79,373
Cash and cash equivalents 102,847 87,334
 
Certificates of deposit 13,011 13,737
Securities available for sale, at fair value 106,369 102,866
Federal Home Loan Bank stock, at cost 15,978 14,105

Loans, net of allowance for loan losses of $8,509 at December 31, 2013 and $7,999 at December 31, 2012

1,078,879

949,662

Foreclosed assets 271 471
Bank-owned life insurance 15,375 14,945
Premises and equipment, net 15,854 14,180
Accrued interest receivable 2,792 2,667
Deferred income tax asset, net 2,934 2,556
Other assets 2,131   3,361
Total assets $ 1,356,441   $ 1,205,884
 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 
Deposits $ 940,906 $ 869,886
Federal Home Loan Bank advances 302,732 234,355
Mortgage payable 1,020 1,065
Mortgagors’ escrow accounts 3,709 3,231
Accrued interest payable 490 478
Other liabilities 4,367   4,070
Total liabilities 1,253,224   1,113,085
 
Stockholders’ equity:

Preferred stock, $1.00 par value, 2,500,000 shares authorized, none issued

Common stock, $1.00 par value, 5,000,000 shares authorized; 2,128,750 shares issued and outstanding at December 31, 2013 and 2,125,750 shares issued and outstanding at December 31, 2012

 

2,129

2,126

Additional paid-in capital 10,659 10,519
Undivided profits 90,449 79,930
Accumulated other comprehensive income (20 ) 224
Total stockholders’ equity 103,217   92,799
Total liabilities and stockholders’ equity $ 1,356,441   $ 1,205,884
 
           
HINGHAM INSTITUTION FOR SAVINGS
Consolidated Statements of Net Income
 
 
 
Three Months Ended Twelve Months Ended
December 31, December 31,
2013       2012 2013       2012
(Unaudited) (In thousands, except per share amounts)
Interest and dividend income:            
Loans $ 12,455 $ 12,126 $ 48,455 $ 47,753
Debt securities 92 111 407 526
Equity securities 65 70 181 198
Short-term investments and certificates of deposit 86 92 299 354
Total interest and dividend income 12,698 12,399 49,342 48,831
Interest expense:
Deposits 1,430 1,467 5,660 5,858
Federal Home Loan Bank advances 1,177 1,282 4,779 5,014
Mortgage payable 16 16 63 65
Total interest expense 2,623 2,765 10,502 10,937
Net interest income 10,075 9,634 38,840 37,894
Provision for loan losses 90 150 380 725
Net interest income, after provision for loan losses 9,985 9,484 38,460 37,169
Other income:
Customer service fees on deposits 261 253 1,019 1,008
Increase in bank-owned life insurance 107 102 430 421
Miscellaneous 66 73 229 237
Total other income 434 428 1,678 1,666
Operating expenses:
Salaries and employee benefits 2,773 2,506 10,602 9,643
Data processing 261 234 1,015 884
Occupancy and equipment 481 438 1,868 1,709
Deposit insurance 172 164 684 611
Foreclosure (32) 5 186 336
Marketing 167 157 557 654
Other general and administrative 700 750 2,615 2,597
Total operating expenses 4,525 4,254 17,527 16,434
Income before income taxes 5,894 5,658 22,611 22,401
Income tax provision 2,406 2,304 9,240 9,111
Net income $ 3,488 $ 3,354 $ 13,371 $ 13,290
 
Weighted average common shares outstanding:
Basic 2,129 2,126 2,128 2,126
Diluted 2,131 2,128 2,130 2,127
 
Earnings per common share:
Basic $ 1.64 $ 1.58 $ 6.28 $ 6.25
Diluted $ 1.64 $ 1.58 $ 6.28 $ 6.25
 
 
HINGHAM INSTITUTION FOR SAVINGS
Net Interest Income Analysis
 
 
 
Three Months Ended December 31,
2013     2012
AVERAGE        

YIELD/

AVERAGE        

YIELD/

BALANCE INTEREST

RATE

BALANCE INTEREST

RATE

(Dollars in thousands)
(Unaudited)
 
Loans (1) (2) $ 1,053,754 $ 12,455 4.73 % $ 938,446 $ 12,126 5.17 %
Securities (3) (4) 115,344 157 0.54 115,630 181 0.63
Short-term investments and certificates of deposit 114,398 86 0.30 119,942 92 0.31
Total earning assets 1,283,496 12,698 3.96 1,174,018 12,399 4.22
Other assets 38,414 36,189
Total assets $ 1,321,910 $ 1,210,207
 
Interest-bearing deposits (5) $ 833,128 1,430 0.69 $ 777,259 1,467 0.75
Borrowed funds 293,442 1,193 1.63 258,641 1,298 2.01
Total interest-bearing liabilities 1,126,570 2,623 0.93 1,035,900 2,765 1.07
Demand deposits 88,294 77,972
Other liabilities 4,571 4,298
Total liabilities 1,219,435 1,118,170
Stockholders’ equity 102,475 92,037

Total liabilities and stockholders’ equity

$ 1,321,910 $ 1,210,207
Net interest income $ 10,075 $ 9,634
 
Weighted average spread 3.03 % 3.15 %
 
Net interest margin (6) 3.14 % 3.28 %
 

Average interest-earning assets to average interest-bearing liabilities (7)

113.93

%

113.33

%

 
 

(1)   Before allowance for loan losses.

(2)   Includes non-accrual loans.

(3)   Excludes the impact of the average net unrealized gain or loss on securities available for sale.

(4)   Includes Federal Home Loan Bank stock.

(5)   Includes mortgagors' escrow accounts.

(6)   Net interest income divided by average total earning assets.

(7)   Total earning assets divided by total interest-bearing liabilities.

 
 
HINGHAM INSTITUTION FOR SAVINGS
Net Interest Income Analysis
 
 
 
Twelve Months Ended December 31,
2013     2012
AVERAGE         YIELD/ AVERAGE         YIELD/
BALANCE INTEREST RATE BALANCE INTEREST RATE
(Dollars in thousands)
(Unaudited)
 
Loans (1) (2) $ 1,000,412 $ 48,455 4.84 % $ 896,372 $ 47,753 5.33 %
Securities (3) (4) 115,246 588 0.51 111,430 724 0.65

Short-term investments and certificates of deposit

100,527 299 0.30 114,845 354 0.31
Total earning assets 1,216,185 49,342 4.06 1,122,647 48,831 4.35
Other assets 37,096 36,623
Total assets $ 1,253,281 $ 1,159,270
 
Interest-bearing deposits (5) $ 806,728 5,660 0.70 $ 752,516 5,858 0.78
Borrowed funds 260,817 4,842 1.86 243,162 5,079 2.09
Total interest-bearing liabilities 1,067,545 10,502 0.98 995,678 10,937 1.10
Demand deposits 83,222 70,946
Other liabilities 3,626 4,357
Total liabilities 1,154,393 1,070,981
Stockholders’ equity 98,888 88,289

Total liabilities and stockholders’ equity

$ 1,253,281 $ 1,159,270
Net interest income $ 38,840 $ 37,894
 
Weighted average spread 3.07 % 3.25 %
 
Net interest margin (6) 3.19 % 3.38 %
 

Average interest-earning assets to average interest-bearing liabilities (7)

113.92

%

112.75

%

 
 

(1)   Before allowance for loan losses.

(2)   Includes non-accrual loans.

(3)   Excludes the impact of the average net unrealized gain or loss on securities available for sale.

(4)   Includes Federal Home Loan Bank stock.

(5)   Includes mortgagors' escrow accounts.

(6)   Net interest income divided by average total earning assets.

(7)   Total earning assets divided by total interest-bearing liabilities.

Contact:
Hingham Institution for Savings
Robert H. Gaughen, Jr., President
William M. Donovan, Jr., Vice President-Administration
781-749-2200

Rates

View Comments (0)