Eagle Financial Bancorp, Inc. (OTCQB: EFBI) (the “Company”), the
holding company for Eagle Savings Bank (the “Bank”), today
announced net income of $497 thousand, or $0.34 per common share on
1.4 million shares outstanding for the quarter ended June 30, 2020,
as compared to $81 thousand, or $0.05 per common share on 1.5
million shares outstanding for the quarter ended June 30, 2019. The
improvement was largely driven by a $784 thousand increase in total
non-interest income, offset by a $200 thousand provision for loan
losses and a $118 thousand increase in income taxes.
Net income for the six months ended June 30, 2020 increased $512
thousand to $674 thousand, or $0.44 per common share as compared to
$162 thousand, or $0.11 per common share for the six months ended
June 30, 2019. The improvement was largely driven by a $1.1
million, or 111.2% increase in total non-interest income, offset by
a $225 thousand increase in provision for loan losses, a $142
thousand increase in income taxes, and a $183 thousand decrease in
net interest income.
The decrease in net interest income for the three months ended
June 30, 2020 was largely driven by a decline in the weighted
average yield on total interest earning assets to 3.88% for the
quarter ended June 30, 2020 from 4.46% for the comparable 2019
period. This decrease was primarily the result of declining
interest rates, especially interest rates on interest earning
deposits which saw a decline in the weighted average yield of 203
basis points for the quarter ended June 30, 2020 as compared to the
quarter ended June 30, 2019.
FINANCIAL HIGHLIGHTS
- Net income of $497 thousand for the three months ended June 30,
2020 compared to $81 thousand for the comparable period in 2019,
representing an increase of $416 thousand, or 513.6%.
- Net income of $674 thousand for the six months ended June 30,
2020 compared to $162 thousand for the comparable period in 2019,
representing an increase of $512 thousand, or 316.0%.
- Net income before taxes of $637 thousand for the quarter ended
June 30, 2020 compared to $103 thousand for the comparable period
in 2019, representing an increase of $534 thousand, or 518.4%.
- Net income before taxes of $866 thousand for the six months
ended June 30, 2020 compared to $212 thousand for the comparable
period in 2019, representing an increase of $654 thousand, or
308.5%
- Non-interest income of $2.0 million for the six months ended
June 30, 2020 compared to $961 thousand for the comparable period
in 2019, representing an increase of $1.1 million, or 111.2%.
- Capital ratios of 14.7%, 17.1% and 18.1% for the Tier 1
Leverage ratio, Tier 1 Risked Based Capital ratio and Total Risked
Based Capital ratio, respectively at June 30, 2020.
Comparison of Financial Condition at June 30, 2020 and
December 31, 2019
Total assets were $154.5 million at June 30, 2020, an increase
of $11.7 million, or 8.2%, over the $142.8 million at December 31,
2019. The increase was primarily due to an increase in loans, net
of allowance for loan losses of $16.8 million, offset by a decrease
in cash and cash equivalents of $4.6 million, and a decrease in
interest-bearing time deposits in other banks of $1.5 million.
Net loans totaled $123.3 million at June 30, 2020, as compared
to $106.6 million at December 31, 2019, an increase of $16.8
million or 15.7%. During the six months ended June 30, 2020, we
originated $100.0 million of loans, $77.3 million of which were
one- to four-family residential real estate loans, and sold $63.1
million of loans in the secondary market. During the six months
ended June 30, 2020, one- to four-family residential real estate
loans decreased $4.2 million, or 7.1%, to $55.6 million,
multi-family loans decreased $27,000, or 2.5%, to $1.0 million,
commercial real estate loans and land loans decreased $533,000, or
2.6%, to $20.3 million, construction loans increased $3.7 million,
or 31.6%, to $15.4 million, home equity and other consumer loans
decreased $1.5 million, or 15.8% to $8.2 million, and commercial
loans increased $22.7 million, or 383.5% to $28.6 million, of which
$22.3 million was due to loans made under the Small Business
Administration’s Payment Protection Program (or “PPP”) . Management
continues to emphasize the origination of high quality loans for
retention in the loan portfolio.
Deposits increased by $10.8 million, or 9.6%, to $122.8 million
at June 30, 2020 from $112.0 million at December 31, 2019. Our core
deposits, which are all deposits other than certificates of
deposit, increased $12.2 million, or 18.9%, to $76.6 million at
June 30, 2020 from $64.4 million at December 31, 2019. Certificates
of deposit decreased $1.4 million, or 3.0%, to $46.2 million at
June 30, 2020 from $47.6 million at December 31, 2019. During the
six months ended June 30, 2020, management continued its strategy
of pursuing growth in demand accounts and other lower cost core
deposits. Management intends to continue its efforts to increase
core deposits, with a special emphasis on growth in consumer and
business demand deposits.
Shareholders’ equity increased $488,000, or 1.7%, to $28.4
million at June 30, 2020 from $27.9 million at December 31, 2019.
The increase resulted from net income of $674,000 during the six
months ended June 30, 2020, expense of $51,000 related to the ESOP
shares committed to be released and expense of $123,000 related to
stock based compensation, offset by a repurchase of common stock of
$281,000 and dividends paid of $79,000.
EAGLE FINANCIAL BANCORP, INC.
STATEMENTS OF CONDITION
June 30, 2020 and March 31, 2020
(Unaudited)
December 31, 2019 (Audited)
(In Thousands)
6/30/2020
3/31/2020 12/31/2019 ASSETS Cash and cash
equivalents
$
10,662
$
15,396
$
15,301
Interest-bearing time deposits in other banks
1,494
2,988
2,988
Loans held for sale
6,421
8,487
6,390
Loans
124,662
106,855
107,734
Less: allowance for loan losses
(1,319
)
(1,196
)
(1,166
)
Loans, net
123,343
105,659
106,568
Premises and equipment, net
4,165
4,049
4,062
Other assets
8,420
7,528
7,479
Total Assets
$
154,505
$
144,107
$
142,788
LIABILITIES AND SHAREHOLDERS’ EQUITY Deposits:
Non-interest bearing
$
7,007
$
5,767
$
5,967
Interest bearing
115,770
107,476
106,024
Total Deposits
122,777
113,243
111,991
Other Liabilities
3,337
2,776
2,894
Total Liabilities
126,114
116,019
114,885
Total Shareholders’ Equity
28,391
28,088
27,903
Total Liabilities and Shareholders’ Equity
$
154,505
$
144,107
$
142,788
Comparison of Operating Results for the Three Months Ended
June 30, 2020 and June 30, 2019
General. Our net income for the three months ended June
30, 2020 was $497,000, compared to a net income of $81,000 for the
three months ended June 30, 2019, an increase of $416,000, or
513.6%. The increase in net income was primarily due to a $784,000
increase in noninterest income, the result of a large increase in
net gain on loan sales, offset by an increase in provision for loan
losses of $200,000, a decrease in net interest income of $55,000,
and an increase in income taxes of $118,000.
Interest Income. Interest income decreased $51,000, or
3.7%, to $1.3 million for the three months ended June 30, 2020 from
$1.4 million for the three months ended June 30, 2019. This
decrease was primarily attributable to a $52,000 decrease in
dividend income on Federal Home Loan Bank (“FHLB”) stock and
interest income on other interest earning deposits. The average
balance of interest earning deposits increased $4.2 million for the
three months ended June 30, 2020, or 38.7%, from the average
balance for the three months ended June 30, 2019, while the average
yield on interest earning deposits decreased by 203 basis points to
0.29% for the three months ended June 30, 2020 from 2.32% for the
three months ended June 30, 2019.
Interest Expense. Total interest expense increased
$4,000, or 1.5%, to $271,000 for the three months ended June 30,
2020 from $267,000 for the three months ended June 30, 2019. This
increase is primarily the result of interest expense on FHLB
advances. The average balance of deposits for the three months
ended June 30, 2020 increased by $12.1 million, or 12.0% from the
average balance for the three months ended June 30, 2019, while the
average cost of deposits decreased by 11 basis points to 0.95% for
the three months ended June 30, 2020 from 1.06% for the three
months ended June 30, 2019.
Interest expense on FHLB advances was $4,000 for the three
months ended June 30, 2020. The average balance of FHLB advances
during the three months ended June 30, 2020 increased by $5.6
million, from the average balance for the three months ended June
30, 2019. The average cost of FHLB advances decreased by 232 basis
points to 0.28% for the three months ended June 30, 2020 from 2.60%
for the three months ended June 30, 2019.
Net Interest Income. Net interest income decreased
$55,000, or 5.0%, to $1.0 million for the three months ended June
30, 2020, compared to $1.1 million for the three months ended June
30, 2019. The decrease reflected a decrease in total interest and
dividend income of $51,000, and an increase in total interest
expense of $4,000. Our net interest margin decreased to 3.08% for
the three months ended June 30, 2020 from 3.59% for the three
months ended June 30, 2019. Our net interest rate spread decreased
to 2.96% for the three months ended June 30, 2020 from 3.40% for
the three months ended June 30, 2019. The interest rate spread and
net interest margin were impacted by declining interest rates in
the three months ended June 30, 2020.
Provision for Loan Losses. Based on our analysis of the
factors described in “Critical Accounting Policies—Allowance for
Loan Losses,” we recorded a provision of $200,000 for loan losses
for the three months ended June 30, 2020, compared to $0 for the
three months ended June 30, 2019. The allowance for loan losses was
$1.3 million, or 0.98% of total loans, at June 30, 2020, compared
to $1.2 million, or 1.02% of total loans, at December 31, 2019.
Total nonperforming loans were $1.7 million at June 30, 2020,
compared to $1.1 million at December 31, 2019. Classified loans
increased to $1.7 million at June 30, 2020, compared to $1.4
million at December 31, 2019. Total loans past due 30 days or more
were $1.3 million and $952,000 at June 30, 2020 and December 31,
2019, respectively. Net recovery totaled $5,000 for the three
months ended June 30, 2020, compared to $4,000 of net recovery for
the three months ended June 30, 2019. The allowance for loan losses
reflects the estimate we believe to be appropriate to cover
incurred probable losses which were inherent in the loan portfolio
at June 30, 2020 and 2019. While we believe the estimates and
assumptions used in our determination of the adequacy of the
allowance are reasonable, such estimates and assumptions could be
proven incorrect in the future, and the actual amount of future
provisions may exceed the amount of past provisions, and the
increase in future provisions that may be required may adversely
impact our financial condition and results of operations. In
addition, bank regulatory agencies periodically review our
allowance for loan losses and may require an increase in the
provision for possible loan losses or the recognition of further
loan charge-offs, based on judgments different than those of
management.
Non-Interest Income. Non-interest income increased
$784,000, or 142.0%, to $1.3 million for the three months ended
June 30, 2020 from $552,000 for the three months ended June 30,
2019. The increase was primarily due to a $766,000 increase in the
net gain on sale of loans during the three months ended June 30,
2020 as compared to the three months ended June 30, 2019.
Non-Interest Expense. Non-interest expense decreased
$5,000, or 0.3%, to $1.54 million for the three months ended June
30, 2020, compared to $1.55 million for the three months ended June
30, 2019. The increase was primarily the result of an increase in
compensation and employee benefits of $51,000, offset by a $57,000
decrease in other operating expenses.
Federal Income Taxes. Federal income taxes increased by
$118,000 to an income tax expense of $140,000 for the three months
ended June 30, 2020, compared to an income tax expense of $22,000
for the three months ended June 30, 2019. The increase in income
tax expense for the three months ended June 30, 2020 was a direct
result of the increase in gain on loans sales, and the resulting
increase in net income.
Comparison of Operating Results for the Six Months Ended June
30, 2020 and June 30, 2019
General. Our net income for the six months ended June 30,
2020 was $674,000, compared to a net income of $162,000 for the six
months ended June 30, 2019, an increase of $512,000, or 316.0%. The
increase in net income was due to an increase in non-interest
income of $1.1 million, offset by an increase in provision for loan
losses of $225,000, a decrease in net interest income of $183,000,
and an increase in income taxes of $142,000 for the six months
ended June 30, 2020 as compared to the six months ended June 30,
2019.
Interest Income. Interest income decreased $130,000, or
4.8%, to $2.6 million for the six months ended June 30, 2020 from
$2.7 million for the six months ended June 30, 2019. This decrease
was attributable to an $83,000 decrease in interest income on loans
receivable, a decrease on FHLB stock dividends of $13,000, and a
decrease in interest income on other interest-earning deposits of
$34,000. The average balance of loans during the six months ended
June 30, 2020 increased by $1.4 million, or 1.2%, from the average
balance for the six months ended June 30, 2019, but the average
yield on loans decreased by 20 basis points to 4.41% for the six
months ended June 30, 2020 from 4.61% for the six months ended June
30, 2019, and the average balance of interest earning deposits
increased $6.5 million, however, the average yield on those
deposits decreased by 139 basis points to 0.96% for the six months
ended June 30, 2020 from 2.35% for the six months ended June 30,
2019.
Interest Expense. Total interest expense increased
$53,000, or 10.5%, to $557,000 for the six months ended June 30,
2020 from $504,000 for the six months ended June 30, 2019. Interest
expense on deposit accounts increased $50,000, or 9.9%, to $553,000
for the six months ended June 30, 2020 from $503,000 for the six
months ended June 31, 2019. The average balance of deposits during
the six months ended June 30, 2019 increased by $8.8 million, or
8.7% from the average balance for the six months ended June 30,
2019, while the average cost of deposits increased by one basis
point to 1.01% for the six months ended June 30, 2020 from 1.00%
for the six months ended June 30, 2019.
Interest expense on FHLB advances increased $3,000, or 300.0%,
to $4,000 for the six months ended June 30, 2020 compared to $1,000
for the six months ended June 30, 2019. The average balance of FHLB
advances during the six months ended June 30, 2020 increased by
$2.8 million from the average balance for the six months ended June
30, 2019, while the average cost of FHLB advances decreased by 232
basis point to 0.28% for the six months ended June 30, 2020 from
2.60% for the six months ended June 30, 2019.
Net Interest Income. Net interest income decreased
$183,000, or 8.3%, to $2.0 million for the six months ended June
30, 2020, compared to $2.2 million for the six months ended June
30, 2019. The decrease reflected a decrease in total interest and
dividend income of $130,000, and an increase in total interest
expense of $53,000. Our net interest margin decreased to 3.09% for
the six months ended June 30, 2020 from 3.59% for the six months
ended June 30, 2019. Our net interest rate spread decreased to
2.95% for the six months ended June 30, 2020 from 3.40% for the six
months ended June 30, 2019. The interest rate spread and net
interest margin were impacted by declining interest rates in the
six months ended June 30, 2020.
Provision for Loan Losses. Based on our analysis of the
factors described in “Critical Accounting Policies—Allowance for
Loan Losses,” we recorded a $225,000 provision for loan losses for
the six months ended June 30, 2020, as compared to $0 for the six
months ended June 30, 2019. The allowance for loan losses was $1.3
million, or 0.98% of total loans, at June 30, 2020, compared to
$1.2 million, or 1.02% of total loans, at December 31, 2019. Total
nonperforming loans were $1.7 million at June 30, 2020, compared to
$1.1 million at December 31, 2019. Classified loans increased to
$1.7 million at June 30, 2020, compared to $1.4 million at December
31, 2019. Total loans past due 30 days or more were $1.3 million
and $952,000 at June 30, 2020 and December 31, 2019, respectively.
Net charge-offs totaled $72,000 for the six months ended June 30,
2020, compared to $31,000 of net loan charge-off for the six months
ended June 30, 2019. The allowance for loan losses reflects the
estimate we believe to be appropriate to cover incurred probable
losses which were inherent in the loan portfolio at June 30, 2019
and 2018. While we believe the estimates and assumptions used in
our determination of the adequacy of the allowance are reasonable,
such estimates and assumptions could be proven incorrect in the
future, and the actual amount of future provisions may exceed the
amount of past provisions, and the increase in future provisions
that may be required may adversely impact our financial condition
and results of operations. In addition, bank regulatory agencies
periodically review our allowance for loan losses and may require
an increase in the provision for possible loan losses or the
recognition of further loan charge-offs, based on judgments
different than those of management.
Non-Interest Income. Non-interest income increased $1.1
million, or 111.2%, to $2.0 million for the six months ended June
30, 2020 from $961,000 for the six months ended June 30, 2019. The
increase was primarily due to an increase in the net gain on sale
of loans of $1.0 million, and a $55,000 increase in other service
charges and fees during the six months ended June 30, 2020 as
compared to the six months ended June 30, 2019.
Non-Interest Expense. Non-interest expense increased
$7,000, or 0.2%, to $2.97 million for the six months ended June 30,
2020, compared to $2.96 million for the six months ended June 30,
2019. The increase was primarily the result of an increase in
compensation and employee benefits of $91,000, offset by an $83,000
decrease in other operating expenses.
Federal Income Taxes. Federal income taxes increased by
$142,000 to an income tax expense of $192,000 for the six months
ended June 30, 2020, compared to an income tax expense of $50,000
for the six months ended June 30, 2019. The increase in income tax
expense for the six months ended June 30, 2020 was a direct result
of the increase in gain on loans sales, and the resulting increase
in net income.
EAGLE FINANCIAL BANCORP, INC.
STATEMENTS OF INCOME
Three and Six Months Ended June 30,
2020 and 2019 (Unaudited)
(In Thousands, except share and per
share data)
Three Months
Three Months
Six Months
Six Months
Ended
Ended
Ended
Ended
6/30/2020
6/30/2019
6/30/2020
6/30/2019
Total interest income
$
1,312
$
1,363
$
2,587
$
2,717
Total interest expense
271
267
557
504
Net interest income
1,041
1,096
2,030
2,213
Provision for loan losses
200
----
225
----
Net interest income after provision for loan loss
841
1,096
1,805
2,213
Total non-interest income
1,336
552
2,030
961
Compensation and benefits
1,109
1,058
2,112
2,021
Occupancy and equipment
63
66
121
125
Data processing
88
78
172
159
Legal and professional fees
82
86
159
167
FDIC Premium Expense
6
8
6
8
Other operating expenses
192
249
399
482
Total non-interest expense
1,540
1,545
2,969
2,962
Net Income Before Taxes
637
103
866
212
Provision for income taxes
140
22
192
50
Net Income
$
497
$
81
$
674
$
162
Basic and Diluted Earnings per Share
$
0.34
$
0.05
$
0.44
$
0.11
Weighted-average shares outstanding Basic and Diluted
1,441,264
1,486,647
1,446,015
1,487,604
EAGLE FINANCIAL BANCORP, INC.
OTHER FINANCIAL INFORMATION
(In Thousands)
(Unaudited)
6/30/2020
3/31/2020
12/31/19
Asset Quality Allowance for Loan Losses
$
1,319
$
1,196
$
1,166
Nonperforming Loans/Total Loans
0.77
%
1.09
%
0.74
%
Nonperforming Assets/Total Assets
1.08
%
1.06
%
0.80
%
ALLL / Nonperforming Loans
105.94
%
115.67
%
101.83
%
ALLL / Loans, Gross
0.98
%
1.05
%
1.02
%
Profitability (For the three months ended) Yield on
Average Earning Assets
3.88
%
4.00
%
4.19
%
Cost of Avg. Interest Bearing Liabilities
0.92
%
1.08
%
1.14
%
Net Spread
2.96
%
2.92
%
3.05
%
Net Margin
3.08
%
3.10
%
3.24
%
6/30/2020
3/31/2020
12/31/19
Capital (Bank Only) Tier 1 Capital Ratio
14.70
%
15.70
%
15.40
%
Tier 1 Risk Based Capital Ratio
17.10
%
16.30
%
16.30
%
Total Risk Based Capital Ratio
18.10
%
17.20
%
17.20
%
Coronavirus Disease 2019 (COVID-19) Impact
Loan Modifications
The Coronavirus Aid, Relief, and Economic Security (CARES) Act
was passed by Congress and signed into law by the President on
March 27, 2020. The CARES Act provides financial institutions the
option of temporarily not accounting for eligible loans as troubled
debt restructurings in accordance with GAAP. In addition,
Interagency Statements were issued on March 22, 2020 and April 7,
2020 by bank regulatory agencies to encourage financial
institutions to work prudently with borrowers. The agencies
confirmed with the FASB that loans that were not more than 30 days
past due as of December 31, 2019 and receive short-term
modifications of six months or less, are not considered to be
delinquent or troubled debt restructurings and are not reported as
nonaccrual.
We began receiving requests from borrowers for loan deferrals in
March 2020. Modifications include the deferral of principal and
interest for generally 90 days. Requests were evaluated
individually and approved modifications were based on the unique
circumstances of each borrower. We are committed to working with
our clients to allow time to work through the challenges of this
pandemic. The Company will be using the provisions of the CARES Act
and the Interagency Statements to account for the loans receiving
forbearance, which means the loans will remain on accrual status
unless the borrower is unable to satisfy the terms of the loans
once the forbearance period ends. At this time, it is uncertain
what future impact loan modifications related to COVID-19
difficulties will have on our financial condition, results of
operations and reserve for loan losses. The following table shows
coronavirus (COVID-19) loan modifications outstanding at June 30,
2020. Of these modifications, $11.9 million, or 100%, were
performing in accordance with their modified terms. Details with
respect to actual modifications are as follows:
Types of Loans
Number of Loans
Balance
Residential mortgage loans
10
$
1,543
Commercial real estate and land loans
13
8,200
Home Equity and other consumer
---
---
Residential Construction
---
---
Residential mortgage loans, non-owner occupied
---
---
Multi-family real estate loans
---
---
Commercial loans
7
2,169
Total
30
$
11,912
Paycheck Protection Program (PPP)
As part of the CARES Act, approved by the President on March 27,
2020, the Small Business Administration (SBA) has been authorized
to guarantee loans under the PPP through June 30, 2020 for small
businesses who meet the necessary eligibility requirements in order
to keep their workers on the payroll. At June 30, 2020, the Bank
has 85 loans for $22.4 million of loans under the PPP. At June 30,
2020, the Bank has recognized interest and fees on these loans of
$101,000.
This release may contain certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995. This release contains forward-looking statements, which
can be identified by the use of words such as “estimate,”
“project,” “believe,” “intend,” “anticipate,” “assume,” “plan,”
“seek,” “expect,” “will,” “may,” “should,” “indicate,” “would,”
“contemplate,” “continue,” “target” and words of similar meaning.
These forward-looking statements include, but are not limited
to:
- statements of our goals, intentions and expectations;
- statements regarding our business plans, prospects, growth and
operating strategies;
- statements regarding the asset quality of our loan and
investment portfolios; and
- estimates of our risks and future costs and benefits.
These forward-looking statements are based on our current
beliefs and expectations and are inherently subject to significant
business, economic and competitive uncertainties and contingencies,
many of which are beyond our control. In addition, these
forward-looking statements are subject to assumptions with respect
to future business strategies and decisions that are subject to
change. We are under no duty to and do not take any obligation to
update any forward-looking statements after the date of this
report.
The following factors, among others, could cause actual results
to differ materially from the anticipated results or other
expectations expressed in the forward-looking statements:
- our ability to continue to manage our operations
successfully;
- effect of the Coronavirus Disease 2019 (COVID-19) pandemic on
our Company, the communities where we have our branches, the state
of Ohio and the United States, related to the economy and overall
financial stability, which may also exacerbate the effects of the
other factors listed herein;
- our ability to successfully implement our business plan of
managed growth, diversifying our loan portfolio and increasing
mortgage banking operations to improve profitability;
- our success in increasing our commercial business, commercial
real estate, construction and home equity lending;
- adverse changes in the financial industry, securities, credit
and national local real estate markets (including real estate
values);
- significant increases in our loan losses, including as a result
of our inability to resolve classified and non-performing assets or
reduce risks associated with our loans, and management’s
assumptions in determining the adequacy of the allowance for loan
losses;
- credit risks of lending activities, including changes in the
level and trend of loan delinquencies and write-offs and in our
allowance for loan losses and provision for loan losses;
- the use of estimates in determining fair value of certain of
our assets, which may prove to be incorrect and result in
significant declines in valuations;
- competition among depository and other financial
institutions;
- our ability to attract and maintain deposits and our success in
introducing new financial products;
- our ability to maintain our asset quality even as we increase
our commercial business, commercial real estate, construction, and
home equity lending;
- changes in interest rates generally, including changes in the
relative differences between short term and long term interest
rates and in deposit interest rates, that may affect our net
interest margin and funding sources;
- fluctuations in the demand for loans, which may be affected by
the number of unsold homes, land and other properties in our market
areas and by declines in the value of real estate in our market
area;
- changes in consumer spending, borrowing and saving habits;
- declines in the yield on our assets resulting from the current
low interest rate environment;
- risks related to a high concentration of loans secured by real
estate located in our market area;
- the results of examinations by our regulators, including the
possibility that our regulators may, among other things, require us
to increase our allowance for loan losses, write down assets,
change our regulatory capital position, limit our ability to borrow
funds or maintain or increase deposits, or prohibit us from paying
dividends, which could adversely affect our dividends and
earnings;
- changes in the level of government support of housing
finance;
- our ability to enter new markets successfully and capitalize on
growth opportunities;
- changes in laws or government regulations or policies affecting
financial institutions, including the Dodd-Frank Act and the JOBS
Act, which could result in, among other things, increased deposit
insurance premiums and assessments, capital requirements,
regulatory fees and compliance costs, particularly the new capital
regulations, and the resources we have available to address such
changes;
- changes in accounting policies and practices, as may be adopted
by the bank regulatory agencies, the Financial Accounting Standards
Board, the Securities and Exchange Commission and the Public
Company Accounting Oversight Board;
- changes in our compensation and benefit plans, and our ability
to retain key members of our senior management team and to address
staffing needs in response to product demand or to implement our
strategic plans;
- loan delinquencies and changes in the underlying cash flows of
our borrowers;
- our ability to control costs and expenses, particularly those
associated with operating as a publicly traded company;
- the failure or security breaches of computer systems on which
we depend;
- the ability of key third-party service providers to perform
their obligations to us;
- changes in the financial condition or future prospects of
issuers of securities that we own; and
- other economic, competitive, governmental, regulatory and
operational factors affecting our operations, pricing, products and
services described elsewhere in our SEC filings.
Given its ongoing and dynamic nature, it is difficult to predict
the full impact of the COVID-19 outbreak on our business. The
extent of such impact will depend on future developments, which are
highly uncertain, including when the coronavirus that has caused
the COVID-19 pandemic can be controlled and abated and when and how
the economy may be reopened. As the result of the COVID-19 pandemic
and the related adverse local and national economic consequences,
our forward-looking statements are subject to the following
additional risks, uncertainties and assumptions:
- demand for our products and services may decline;
- if the economy is unable to substantially reopen, and high
levels of unemployment continue for an extended period of time,
loan delinquencies, problem assets, and foreclosures may
increase;
- collateral for loans, especially real estate, may decline in
value;
- our allowance for loan losses may have to be increased if
borrowers experience financial difficulties;
- the net worth and liquidity of loan guarantors may
decline;
- as the result of the decline in the Federal Reserve Board’s
target federal funds rate to near 0%, the yield on our assets may
decline to a greater extent than the decline in our cost of
interest-bearing liabilities;
- a material decrease in net income or a net loss over several
quarters could result in a decrease in the rate of our quarterly
cash dividend;
- actions taken by the federal, state or local governments to
cushion the impact of COVID-19 on consumers and businesses may have
a negative impact on us and our business;
- our cyber security risks are increased as the result of an
increase in the number of employees working remotely; and
- FDIC premiums may increase if the agency experiences additional
resolution costs.
Because of these and a wide variety of other uncertainties our
actual future results may be materially different from the results
indicated by these forward-looking statements.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200807005028/en/
Gary Koester, President & Chief Executive Officer Patricia
Walter, Executive Vice President Kevin Schramm, Vice President
& Chief Financial Officer (513) 574-0700
Eagle Financial Bancorp (NASDAQ:EFBI)
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Eagle Financial Bancorp (NASDAQ:EFBI)
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