Indiana Business Bancorp Reports First Quarter Results and Cash Dividend

Business Wire


Indiana Business Bancorp (OTCBB:IBBI.OB), the holding company for Indiana Business Bank, announced results for the three months ended March 31, 2014 and its second quarterly cash dividend.

The company recorded a profit of $117,294, or $0.07 per share for the first quarter of 2014. This compares to a profit of $234,355, or $0.16 per share for the first quarter of 2013. The decrease in profitability was a result of increased provision expense, a decrease in noninterest income and an increase in noninterest expense. Provision expense of $85,000 for the quarter ended March 31, 2014 was $25,000 greater than the provision for the same quarter of 2013. Although the Bank’s credit profile continues to improve, an increase in provision expense was made to maintain an appropriate loan loss reserve.

Non-interest income for the first quarter of 2014 was $85,224 compared to $133,885 for the first quarter of 2013. Gains on sale of government guaranteed loans were exceptionally high in the first quarter of 2013. The 2014 results for sales of government guaranteed loans represent a more normalized level.

Non-interest expense was $639,209 for the quarter ended March 31, 2014 compared to $602,529 for the same quarter of 2013. The increased expense was driven by higher salaries and benefits costs. Salaries rose as a result of staffing increases and merit raises for existing personnel. Benefits increased primarily due to increased health insurance costs.

The Bank’s Tier I Leverage Ratio of 14.68% and Total Risk Based Capital Ratio of 20.24% exceeded the levels needed to be considered “well capitalized” at March 31, 2014. The allowance for loan losses at the same date was $989,376, or 1.89% of total loans.

Dividend Declared

The Company also announced that the Board of Directors has declared a dividend of $0.02 per share of common stock, payable on May 19, 2014 to shareholders of record at the close of business on May 9, 2014. The Company expects to continue paying cash dividends on a quarterly basis; however, the payment and amount of any future dividends will be determined by the Board of Directors on the basis of Company’s financial condition, earnings, regulatory constraints and other factors.

President and CEO James S. Young stated, “We are pleased with our first quarter performance. Although our profits were down, we view our increase in loan reserves and our increase in personnel expenses as an investment in future core earnings. We are focused on the prudent growth of our loan portfolio over the long term.” He also added, “We are pleased once again to pay a cash dividend to our shareholder base.”

About Indiana Business Bancorp and Indiana Business Bank

Indiana Business Bancorp is a bank holding company whose operations are conducted through its subsidiary, Indiana Business Bank, a state-chartered, locally-owned and managed commercial bank formed for the purpose of providing highly-personalized banking services for small to medium-sized businesses, their owners and professional services firms in the Indianapolis, Indiana metropolitan area. The bank provides a full line of commercial banking loan, deposit, and cash management services that are delivered in a highly personalized manner by experienced banking professionals. The bank specializes in serving the commercial and consumer banking needs of small to medium sized businesses and their owners, and professionals located primarily throughout Central Indiana.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding Indiana Business Bank and Indiana Business Bancorp’s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties which may cause actual results to differ materially from expected results, including: changes in general, regional and local economic conditions, and their effect on interest rates; the impact of the downturn in housing and the adverse conditions in the credit markets; competition among banks and other financial intermediaries within the Indianapolis metropolitan market; risks that borrowers may default on their loans; and changes in regulations and accounting policies affecting financial institutions.



As of and for the Three Months
Ending March 31

Operating Data     2014     2013
Net Interest Income     706,279     712,999
Provision for Loan Losses     85,000     60,000
Noninterest Income     85,224     133,885
Noninterest Expense     639,209     602,529
Pre Tax Net Income     67,294     184,355
Def Tax Benefit     50,000     50,000
After Tax Net Income     117,294     234,355
Per Share Data            
Net Earnings (Loss) – Basic     0.07     0.16

Weighted Average Shares Outstanding

    1,594,095     1,510,376
    As of    
Balance Sheet Data

March 31, 2014

    December 31, 2013 March 31, 2013
Total Assets 66,471,548 68,671,914 64,859,034
Gross Loans 52,012,345 54,159,075 52,112,235
Allowance for Loan Losses 989,376 874,370 1,289,671
Investment Securities 9,031,628 8,141,359 5,920,357
Total Deposits 47,559,674 49,661,051 48,125,443
Total Shareholders’ Equity 10,399,775 10,418,284 10,041,577

Indiana Business Bancorp
Gregory Gault, Executive Vice President, 317-218-2181
Guy Johnson Public Relations
Guy Johnson, 317-503-4605


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