SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
10-Q
(mark
one)
ý
QUARTERLY
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE
ACT OF 1934
For
the quarterly period ended March 31, 2009
or
¨
TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the
transition period from _______to_______
Commission
File Number 000-51876
MUTUAL
FEDERAL BANCORP, INC.
(Exact
name of registrant specified in its charter)
|
Federal
(State
or other jurisdiction of incorporation or organization)
|
33-1135091
(I.R.S.
Employer Identification Number)
|
|
2212
West Cermak Road
Chicago,
Illinois 60608
(Address
of principal executive offices)
|
(773)
847-7747
(Registrant’s
telephone number, including area code)
Not
Applicable
(Former
name, former address and former fiscal year,
if
changed since last report)
Indicate
by check mark whether the registrant (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes
ý
No
¨
Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding
12 months (or for such shorter period that the registrant was required to submit
and post such files). Yes
¨
No
¨
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of “large accelerated filer,”
“accelerated filer” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act.
|
Large
accelerated filer
¨
|
Accelerated
filer
¨
|
|
Non-accelerated
filer
¨
(Do not check if
a smaller reporting company)
|
Smaller
reporting company
ý
|
Indicate
by a check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes
¨
No
ý
Indicate
the number of shares outstanding of each of the issuer’s classes of common
equity, as of the latest practicable date:
|
Class
|
Outstanding
as of May 1, 2009
|
|
Common
Stock, $0.01 par value
|
3,334,273
|
MUTUAL
FEDERAL BANCORP, INC.
FORM
10-Q
For
the quarterly period ended March 31, 2009
TABLE OF CONTENTS
|
|
Page
|
|
|
|
|
|
|
|
|
1
|
|
|
2
|
|
|
3
|
|
|
5
|
|
|
13
|
|
|
23
|
|
|
23
|
|
|
|
|
|
|
|
|
25
|
|
|
25
|
|
|
25
|
|
|
25
|
|
|
25
|
|
|
25
|
|
|
26
|
|
|
|
|
|
27
|
|
|
|
|
|
|
PART I
. – FINANCIAL INFORMATION
Item 1
.
Financial
Statements
MUTUAL
FEDERAL BANCORP, INC.
CONSOLIDATED
STATEMENTS OF FINANCIAL CONDITION
(unaudited)
(Dollar
amounts in thousands except share data)
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
$
|
5,653
|
|
|
$
|
3,454
|
|
|
Trading
securities
|
|
|
1,300
|
|
|
|
2,100
|
|
|
Securities
available-for-sale
|
|
|
10,434
|
|
|
|
10,812
|
|
|
Loans,
net of allowance for loan losses of $755 at
March 31, 2009; $1,287 at December 31, 2008
|
|
|
49,040
|
|
|
|
51,464
|
|
|
Real
estate owned
|
|
|
1,160
|
|
|
|
235
|
|
|
Federal
Home Loan Bank stock, at cost
|
|
|
610
|
|
|
|
610
|
|
|
Premises
and equipment, net
|
|
|
1,022
|
|
|
|
918
|
|
|
Accrued
interest receivable
|
|
|
333
|
|
|
|
343
|
|
|
Other
assets
|
|
|
1,296
|
|
|
|
1,272
|
|
|
Total
assets
|
|
$
|
70,848
|
|
|
$
|
71,208
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDER’S EQUITY
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
deposits
|
|
$
|
303
|
|
|
$
|
199
|
|
|
Interest-bearing
deposits
|
|
|
39,285
|
|
|
|
38,293
|
|
|
Total
deposits
|
|
|
39,588
|
|
|
|
38,492
|
|
|
Advance
payments by borrowers for taxes
and
insurance
|
|
|
112
|
|
|
|
364
|
|
|
Advances
from the Federal Home Loan Bank
|
|
|
6,000
|
|
|
|
6,000
|
|
|
Accrued
interest payable and other liabilities
|
|
|
986
|
|
|
|
1,443
|
|
|
Common
stock in ESOP subject to contingent repurchase
obligation
|
|
|
131
|
|
|
|
138
|
|
|
Total
liabilities
|
|
|
46,817
|
|
|
|
46,437
|
|
|
Commitments
and contingencies
|
|
|
|
|
|
|
|
|
|
Stockholders’
equity
|
|
|
|
|
|
|
|
|
|
Preferred
stock, $0.01 par value, 1,000,000 shares
authorized
at March 31, 2009 and December 31, 2008
|
|
|
—
|
|
|
|
—
|
|
|
Common
stock, $0.01 par value, 12,000,000 shares
authorized,
3,636,875 shares issued at March 31, 2009
and
December 31, 2008
|
|
|
36
|
|
|
|
36
|
|
|
Additional
paid-in capital
|
|
|
10,046
|
|
|
|
9,981
|
|
|
Treasury
stock, at cost, 302,602 shares at March 31, 2009
and
235,558 at December 31, 2008
|
|
|
(3,146
|
)
|
|
|
(2,558
|
)
|
|
Retained
earnings
|
|
|
17,758
|
|
|
|
18,015
|
|
|
Reclassification
of ESOP shares
|
|
|
(131
|
)
|
|
|
(138
|
)
|
|
Unearned
ESOP shares
|
|
|
(697
|
)
|
|
|
(711
|
)
|
|
Accumulated
other comprehensive income
|
|
|
165
|
|
|
|
146
|
|
|
Total
stockholders’ equity
|
|
|
24,031
|
|
|
|
24,771
|
|
|
Total
liabilities and stockholders’ equity
|
|
$
|
70,848
|
|
|
$
|
71,208
|
|
See
accompanying notes to unaudited consolidated financial statements.
MUTUAL
FEDERAL BANCORP, INC.
CONSOLIDATED
STATEMENTS OF INCOME
(unaudited)
(Dollar
amounts in thousands except share data)
|
|
|
Three
Months Ended
March 31,
|
|
|
|
|
|
|
|
|
|
|
Interest
and dividend income
|
|
|
|
|
|
|
|
Loans,
including fees
|
|
$
|
786
|
|
|
$
|
823
|
|
|
Securities
|
|
|
139
|
|
|
|
189
|
|
|
Interest
earning deposits
|
|
|
—
|
|
|
|
15
|
|
|
Federal
Home Loan Bank stock dividends
|
|
|
—
|
|
|
|
—
|
|
|
Total
interest and dividend income
|
|
|
925
|
|
|
|
1,027
|
|
|
Interest
expense
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
204
|
|
|
|
272
|
|
|
Advances
from Federal Home Loan Bank
|
|
|
54
|
|
|
|
62
|
|
|
|
|
|
258
|
|
|
|
334
|
|
|
Net
interest income
|
|
|
667
|
|
|
|
693
|
|
|
Provision
for loan losses
|
|
|
195
|
|
|
|
40
|
|
|
Net
interest income after provision for
loan losses
|
|
|
472
|
|
|
|
653
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest
income
|
|
|
|
|
|
|
|
|
|
Changes
in fair value of trading securities
|
|
|
(50
|
)
|
|
|
(8
|
)
|
|
Other
income
|
|
|
10
|
|
|
|
11
|
|
|
Total
non-interest income
|
|
|
(40
|
)
|
|
|
3
|
|
|
Non-interest
expense
|
|
|
|
|
|
|
|
|
|
Compensation
and benefits
|
|
|
386
|
|
|
|
373
|
|
|
Occupancy
and equipment
|
|
|
45
|
|
|
|
40
|
|
|
Data
processing
|
|
|
34
|
|
|
|
26
|
|
|
Professional
fees
|
|
|
170
|
|
|
|
117
|
|
|
Other
expense
|
|
|
125
|
|
|
|
72
|
|
|
Total
non-interest expense
|
|
|
760
|
|
|
|
628
|
|
|
Income
(loss) before income taxes
|
|
|
(328
|
)
|
|
|
28
|
|
|
Income
tax expense (benefit)
|
|
|
(118
|
)
|
|
|
13
|
|
|
Net
income (loss)
|
|
$
|
(210
|
)
|
|
$
|
15
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings
(loss) per share (basic and diluted)
|
|
$
|
(0.06
|
)
|
|
$
|
0.00
|
|
See
accompanying notes to unaudited consolidated financial statements.
MUTUAL
FEDERAL BANCORP, INC.
CONSOLIDATED
STATEMENTS OF STOCKHOLDERS’
EQUITY (unaudited)
(Dollar
amounts in thousands)
|
|
|
|
|
|
Additional
Paid-in Capital
|
|
|
|
|
|
|
|
|
Amount
Reclassified on ESOP Shares
|
|
|
|
|
|
Accumulated
Other
Comprehensive
Income/(Loss)
|
|
|
|
|
|
Balance
at January 1, 2009
|
|
$
|
36
|
|
|
$
|
9,981
|
|
|
$
|
(2,558
|
)
|
|
$
|
18,015
|
|
|
$
|
(138
|
)
|
|
$
|
(711
|
)
|
|
$
|
146
|
|
|
$
|
24,771
|
|
|
Comprehensive
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income (loss)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(210
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(210
|
)
|
|
Change
in net unrealized gain
loss)
on
securities
available-for-sale, net
of
taxes and
reclassification
adjustments
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
19
|
|
|
|
19
|
|
|
Total
comprehensive
income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(191
|
)
|
|
Treasury
stock purchases
|
|
|
—
|
|
|
|
—
|
|
|
|
(588
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(588
|
)
|
|
Dividends
paid
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(51
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(51
|
)
|
|
Income
tax benefit of
dividends on
non-
vested MRP shares
|
|
|
—
|
|
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1
|
|
|
MRP
shares earned
|
|
|
—
|
|
|
|
39
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
39
|
|
|
Stock
option shares earned
|
|
|
—
|
|
|
|
27
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
27
|
|
|
Adjustment
to fair value of
common
stock
in ESOP
subject to
contingent
repurchase
obligation
of ESOP shares
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
7
|
|
|
|
—
|
|
|
|
—
|
|
|
|
7
|
|
|
ESOP
shares committed to
be released (1,393)
|
|
|
—
|
|
|
|
(2
|
)
|
|
|
—
|
|
|
|
4
|
|
|
|
—
|
|
|
|
14
|
|
|
|
—
|
|
|
|
16
|
|
|
Balance
at March 31, 2009
|
|
$
|
36
|
|
|
$
|
10,046
|
|
|
$
|
(3,146
|
)
|
|
$
|
17,758
|
|
|
$
|
(131
|
)
|
|
$
|
(697
|
)
|
|
$
|
165
|
|
|
$
|
24,031
|
|
See
accompanying notes to unaudited consolidated financial statements.
|
|
|
|
|
|
Additional
Paid-in Capital
|
|
|
|
|
|
|
|
|
Amount
Reclassified on ESOP Shares
|
|
|
|
|
|
Accumulated
Other
Comprehensive
Income/(Loss)
|
|
|
|
|
|
Balance
at January 1, 2008
|
|
$
|
36
|
|
|
$
|
9,738
|
|
|
$
|
(1,286
|
)
|
|
$
|
19,077
|
|
|
$
|
(108
|
)
|
|
$
|
(768
|
)
|
|
$
|
222
|
|
|
$
|
26,911
|
|
|
Comprehensive
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
15
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
15
|
|
|
Change
in net unrealized gain (loss)
on
securities available-for-sale, net
of
taxes and reclassification
adjustments
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
35
|
|
|
|
35
|
|
|
Total
comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
50
|
|
|
MRP
share grants, 2,138
shares
at
cost
|
|
|
—
|
|
|
|
(25
|
)
|
|
|
25
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
MRP
shares earned
|
|
|
—
|
|
|
|
38
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
38
|
|
|
Stock
option shares earned
|
|
|
—
|
|
|
|
26
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
26
|
|
|
Adjustment
to fair value of
common stock in ESOP
subject to contingent
repurchase obligation
of ESOP shares
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(25
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(25
|
)
|
|
ESOP
shares committed to
be
released
(1,440)
|
|
|
—
|
|
|
|
3
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
14
|
|
|
|
—
|
|
|
|
17
|
|
|
Balance
at March 31, 2008
|
|
$
|
36
|
|
|
$
|
9,780
|
|
|
$
|
(1,261
|
)
|
|
$
|
19,092
|
|
|
$
|
(133
|
)
|
|
$
|
(754
|
)
|
|
$
|
257
|
|
|
$
|
27,017
|
|
See
accompanying notes to unaudited consolidated financial statements.
MUTUAL
FEDERAL BANCORP, INC.
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(unaudited)
(Dollar
amounts in thousands)
|
|
|
Three
Months Ended
March 31,
|
|
|
|
|
|
|
|
|
|
|
Cash
flows from operating activities
|
|
|
|
|
|
|
|
Net
income (loss)
|
|
$
|
(210
|
)
|
|
$
|
15
|
|
|
Adjustments
to reconcile net income (loss) to net cash
from
operating activities
|
|
|
|
|
|
|
|
|
|
Provision
for loan losses
|
|
|
195
|
|
|
|
40
|
|
|
Depreciation
|
|
|
11
|
|
|
|
13
|
|
|
Net
amortization of securities
|
|
|
2
|
|
|
|
5
|
|
|
Dividends
reinvested on securities
|
|
|
—
|
|
|
|
(27
|
)
|
|
Changes
in fair value of trading securities
|
|
|
50
|
|
|
|
8
|
|
|
ESOP
expense
|
|
|
16
|
|
|
|
17
|
|
|
MRP
expense
|
|
|
39
|
|
|
|
38
|
|
|
Option
expense
|
|
|
27
|
|
|
|
26
|
|
|
(Increase)
decrease in accrued interest receivable
and
other assets
|
|
|
(15
|
)
|
|
|
(242
|
)
|
|
Increase
(decrease) in accrued interest payable
and
other liabilities
|
|
|
(467
|
)
|
|
|
(142
|
)
|
|
Net
cash used in operating activities
|
|
|
(352
|
)
|
|
|
(249
|
)
|
|
Cash
flows from investing activities
|
|
|
|
|
|
|
|
|
|
Activity
in securities available-for-sale:
|
|
|
|
|
|
|
|
|
|
Proceeds
from maturities, calls, and principal
repayments
|
|
|
407
|
|
|
|
949
|
|
|
Proceeds
from redemption of mutual funds
|
|
|
750
|
|
|
|
—
|
|
|
Loan
originations and payments, net
|
|
|
1,304
|
|
|
|
740
|
|
|
Additions
to premises and equipment
|
|
|
(115
|
)
|
|
|
(2
|
)
|
|
Net
cash provided by investing activities
|
|
|
2,346
|
|
|
|
1,687
|
|
|
Cash
flows from financing activities
|
|
|
|
|
|
|
|
|
|
Net
increase (decrease) in deposits
|
|
|
1,096
|
|
|
|
40
|
|
|
Net
decrease in advance payments by borrowers for taxes and
insurance
|
|
|
(252
|
)
|
|
|
(91
|
)
|
|
Advances
from the Federal Home Loan Bank
|
|
|
—
|
|
|
|
2,000
|
|
|
Repayment
of advances from the Federal Home Loan Bank
|
|
|
—
|
|
|
|
(2,000
|
)
|
|
Dividends
paid
|
|
|
(51
|
)
|
|
|
—
|
|
|
Treasury
stock purchases
|
|
|
(588
|
)
|
|
|
—
|
|
|
Net
cash provided by financing activities
|
|
|
205
|
|
|
|
(51
|
)
|
|
Net
increase in cash and cash equivalents
|
|
|
2,199
|
|
|
|
1,387
|
|
|
Cash
and cash equivalents at beginning of
period
|
|
|
3,454
|
|
|
|
2,264
|
|
|
Cash
and cash equivalents at end of
period
|
|
$
|
5,653
|
|
|
$
|
3,651
|
|
See
accompanying notes to unaudited consolidated financial statements.
|
Supplemental
disclosure of cash flow information
|
|
|
|
|
|
|
|
|
|
Adoption
of fair value option
|
|
|
|
|
|
|
|
|
|
Securities
transferred from available-for-sale to trading
|
|
$
|
—
|
|
|
$
|
2,423
|
|
|
Transfers
to real estate owned
|
|
|
925
|
|
|
|
—
|
|
|
Cash
paid during the year for:
|
|
|
|
|
|
|
|
|
|
Interest
|
|
$
|
237
|
|
|
$
|
346
|
|
|
Income
taxes
|
|
|
—
|
|
|
|
106
|
|
See
accompanying notes to unaudited consolidated financial statements.
MUTUAL
FEDERAL BANCORP, INC.
NOTES TO UNAUDITED CONSOLIDATED
FINANCIAL STATEMENTS
Note
1 – Basis of Presentation
The accompanying unaudited consolidated
financial statements have been prepared in accordance with U.S. generally
accepted accounting principles (GAAP) for interim financial information and with
instructions to Form 10-Q (as applicable to smaller reporting companies) and
Article 10 of Regulation S-X. Accordingly, they do not include
all of the information and notes required by GAAP for complete financial
statements. In the opinion of management, all adjustments consisting
of normal recurring accruals necessary for a fair presentation have been
included. The results of operations and other data for the three
months ended March 31, 2009, are not necessarily indicative of results that may
be expected for the entire fiscal year ended December 31,
2009.
The
consolidated financial statements include Mutual Federal Bancorp, Inc. (the
“Company”), and its wholly owned subsidiary Mutual Federal Savings and Loan
Association of Chicago and its wholly owned subsidiaries, EMEFES Service
Corporation and 2212 Holdings, LLC, together referred to as “the
Bank.” Intercompany transactions and balances are eliminated in
consolidation. As of March 31, 2009, Mutual Federal Bancorp, MHC (the
“MHC”) was the majority (76%) stockholder of the Company. The MHC is
owned by the depositors of the Bank. The financial statements
included in this Form 10-Q do not include the transactions and balances of
the MHC. EMEFES Service Corporation is an insurance agency that sells
insurance products to the Bank’s customers. The insurance products
are underwritten and provided by a third party. 2212 Holdings, LLC
was established in 2008 to hold and manage real estate acquired through
foreclosure.
The Bank
provides financial services through its office in Chicago. Its
primary deposit products are checking, savings, and term certificate accounts,
and its primary lending products are residential mortgage loans and loans on
deposit accounts. Substantially all loans are secured by specific
items of collateral, including one- to four-family and multifamily residential
real estate, and deposit accounts. However, the
customers’ ability to repay their loans is dependent on the real estate and
general economic conditions in the Chicago area.
Note
2 – Capital Resources
The Bank
is subject to regulatory capital requirements administered by the federal
banking agencies. Failure to meet minimum capital requirements can
initiate certain mandatory, and possibly additional discretionary actions by
regulators that, if undertaken, could have a material impact on the Bank’s
financial statements. Under capital adequacy guidelines and the
regulatory framework for prompt corrective action, the Bank must meet specific
capital guidelines that involve quantitative measures of the Bank’s assets,
liabilities, and certain off-balance sheet items as calculated for regulatory
accounting purposes. The Bank’s capital amounts and classification
are also subject to qualitative judgments by the regulators about components,
risk weightings, and other factors.
Quantitative
measures established by regulation to ensure capital adequacy require the Bank
to maintain minimum amounts and ratios of total and Tier 1 capital to
risk-weighted assets, and of Tier 1 capital to average assets and of tangible
capital to average assets. As of March 31, 2009, the Bank met
the capital adequacy requirements to which it is subject. The Bank’s
tangible capital ratio at March 31, 2009 was 31.81%. The Tier 1
capital ratio was 31.81%, the Tier 1 risk-based capital ratio was 52.10%, and
the total risk-based capital ratio was 53.32%.
The most
recent notification from the federal banking agencies categorized the Bank as
well-capitalized under the regulatory framework for prompt corrective
action. To be well-capitalized, the Bank must maintain minimum total
risk-based, Tier 1 risk-based, and Tier 1 leverage ratios. There are
no conditions or events since that notification that have changed the Bank’s
category.
MUTUAL
FEDERAL BANCORP, INC.
NOTES TO UNAUDITED
CONSOLIDATED FINANCIAL STATEMENTS
Note 3
– Commitments
At
March 31, 2009, the Bank had outstanding commitments to make loans of
$95,000. At December 31, 2008, the Bank had no outstanding
commitments to make loans.
Note
4 – Recently Issued and Not Yet Effective Accounting
Standards
In April
2009, the FASB issued Staff Position (FSP) No. 115-2 and No. 124-2,
Recognition and Presentation of
Other-Than-Temporary Impairments,
which amends existing guidance for
determining whether impairment is other-than-temporary for debt
securities. The FSP requires an entity to assess whether it intends
to sell, or it is more likely than not that it will be required to sell a
security in an unrealized loss position before recovery of its amortized cost
basis. If either of these criteria is met, the entire difference
between amortized cost and fair value is recognized in earnings. For
securities that do not meet the aforementioned criteria, the amount of
impairment recognized in earnings is limited to the amount related to credit
losses, while impairment related to other factors is recognized in other
comprehensive income. Additionally, the FSP expands and
increases the frequency of existing disclosures about other-than-temporary
impairments for debt and equity securities. This FSP is effective for
interim and
annual reporting
periods ending after June 15,
2009, with early adoption permitted for periods ending after March 15,
2009. The Company plans to adopt this FSP in the second quarter,
however, does not expect the adoption to have a material effect on the results
of operations or financial position.
In April
2009, the FASB issued Staff Position (FSP) No. 157-4,
Determining Fair Value When the
Volume and Level of Activity for the Asset and Liability Have Significantly
Decreased and Identifying Transactions That Are Not
Orderly
. This FSP emphasizes that even if there has been a
significant decrease in the volume and level of activity, the objective of a
fair value measurement remains the same. Fair value is the price that
would be received to sell an asset or paid to transfer a liability in an orderly
transaction (that is, not a forced liquidation or distressed sale) between
market participants. The FSP provides a number of factors to consider
when evaluating whether there has been a significant decrease in the volume and
level of activity for an asset or liability in relation to normal market
activity. In addition, when transactions or quoted prices are
not considered orderly, adjustments to those prices based on the weight of
available information may be needed to determine the appropriate fair
value. The FSP also requires increased disclosures. This
FSP is effective for interim and annual reporting periods ending after June 15,
2009, and shall be applied prospectively. Early adoption is permitted
for periods ending after March 15, 2009. The Company plans to adopt
this FSP in the second quarter, however, does not expect the adoption to have a
material effect on the results of operations or financial position.
In April
2009, the FASB issued Staff Position (FSP) No. 107-1 and APB 28-1,
Interim Disclosures about Fair Value
of Financial Instruments
. This FSP amends FASB Statement No.
107,
Disclosures about Fair
Value of Financial Instruments
, to require disclosures about fair value
of financial instruments for interim reporting periods of publicly traded
companies that were previously only required in annual financial
statements. This FSP is effective for interim reporting periods
ending after June 15, 2009, with early adoption permitted for periods ending
after March 15, 2009. The Company plans to adopt this FSP in the
second quarter.
MUTUAL
FEDERAL BANCORP, INC.
NOTES TO UNAUDITED
CONSOLIDATED FINANCIAL STATEMENTS
Note
5 – Fair Value
Fair Value
Option
The
Company has elected the fair value option for various mutual funds in order to
make them more readily available for liquidity management. The mutual
funds are the only assets being designated as trading assets. The
Company’s investments in Federal Home Loan Mortgage Corporation preferred stock,
and all debt securities, will continue to be held as available for sale, carried
at fair value with unrealized gains and losses recorded through accumulated
other comprehensive income. Unrealized losses on securities held as
available for sale that management considers other-than-temporary are recognized
through income as write downs of the cost basis of the securities.
Fair
Value Measurement
Statement
157 defines fair value as the exchange price that would be received for an asset
or paid to transfer a liability (an exit price) in the principal or most
advantageous market for the asset or liability in an orderly transaction between
market participants on the measurement date. Statement 157 also establishes a
fair value hierarchy which requires an entity to maximize the use of observable
inputs and minimize the use of unobservable inputs when measuring fair value.
The standard describes three levels of inputs that may be used to measure fair
value:
Level 1:
Quoted prices (unadjusted) of identical assets or liabilities in active markets
that the entity has the ability to access as of the measurement
date.
Level 2:
Significant other observable inputs other than Level 1 prices such as quoted
prices for similar assets or liabilities; quoted prices in markets that are not
active; or other inputs that are observable or can be corroborated by observable
market data.
Level 3:
Significant unobservable inputs that reflect a company’s own assumptions about
the assumptions that market participants would use in pricing an asset or
liability.
The
Company determines the fair values of trading securities and securities
available for sale by obtaining quoted prices on nationally recognized
securities exchanges (Level 1 inputs) or matrix pricing, which is a mathematical
technique widely used in the industry to value debt securities without relying
exclusively on quoted prices for the specific securities, but rather by relying
on the securities’ relationship to other benchmark quoted securities (Level 2
inputs). The Company determines the fair values of impaired loans and
other real estate owned by obtaining current appraisals of the collateral real
estate properties (Level 2 inputs) or adjusting estimated fair values of
appraisals using management judgment (Level 3 inputs).
Assets Measured on a
Recurring Basis:
|
|
|
|
|
|
Fair
Value Measurements at March 31, 2009 Using
|
|
|
(Dollar
amounts in thousands)
|
|
|
|
|
Quoted
Prices in Active Markets for Identical Assets
|
|
|
Significant
Other Observable Inputs
|
|
|
Significant
Unobservable Inputs
|
|
|
|
|
|
|
|
Level
1
|
|
|
Level
2
|
|
|
Level
3
|
|
|
Trading
securities
|
|
$
|
1,300
|
|
|
$
|
1,300
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Securities
available-for-sale
|
|
|
10,434
|
|
|
|
7
|
|
|
|
10,427
|
|
|
|
—
|
|
|
|
|
$
|
11,734
|
|
|
$
|
1,307
|
|
|
$
|
10,427
|
|
|
$
|
—
|
|
MUTUAL
FEDERAL BANCORP, INC.
NOTES TO UNAUDITED
CONSOLIDATED FINANCIAL STATEMENTS
Note
5 – Fair Value (continued)
|
|
|
|
|
|
Fair
Value Measurements at December 31, 2008 Using
|
|
|
(Dollar
amounts in thousands)
|
|
|
|
|
Quoted
Prices in Active Markets for Identical Assets
|
|
|
Significant
Other Observable Inputs
|
|
|
Significant
Unobservable Inputs
|
|
|
|
|
|
|
|
Level
1
|
|
|
Level
2
|
|
|
Level
3
|
|
|
Trading
securities
|
|
$
|
2,100
|
|
|
$
|
2,100
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Securities
available-for-sale
|
|
|
10,812
|
|
|
|
7
|
|
|
|
10,805
|
|
|
|
—
|
|
|
|
|
$
|
12,912
|
|
|
$
|
2,107
|
|
|
$
|
10,805
|
|
|
$
|
—
|
|
Dividend
income earned on trading securities was reinvested and used to purchase
additional shares through May 31, 2008. The Company discontinued
reinvesting dividends in these securities as of June 1, 2008. Changes
in share price are recorded through the income statement as changes in fair
value of trading securities. During the three months ended March 31,
2009, the Company recognized an unrealized loss of $50,000 on changes in fair
value of trading securities. Restrictions on redemption of these
securities have been imposed by the manager of these funds, limiting cash
redemptions to $250,000 per fund (there are three funds) per
quarter. The Company requested the maximum redemption for all
three funds during the three months ended March 31, 2009, realizing proceeds of
$750,000 and an aggregate loss of $174,000. The realized loss on sold
securities has previously been recorded in the statement of income within
changes in fair value of trading securities. The Company has not
decided whether or not to continue redemptions in following
quarters.
Assets Measured on a
Non-Recurring Basis:
|
|
|
|
|
|
Fair
Value Measurements at March 31, 2009 Using
|
|
|
(Dollar amounts in
thousands)
|
|
|
|
|
Quoted
Prices in Active Markets for Identical Assets
|
|
|
Significant
Other Observable Inputs
|
|
|
Significant
Unobservable Inputs
|
|
|
|
|
|
|
|
Level
1
|
|
|
Level
2
|
|
|
Level
3
|
|
|
Impaired
loans
|
|
$
|
1,499
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,499
|
|
|
Real
estate owned
|
|
|
1,160
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,160
|
|
|
|
|
$
|
2,659
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,659
|
|
|
|
|
|
|
|
Fair
Value Measurements at December 31, 2008 Using
|
|
|
(Dollar amounts in
thousands)
|
|
|
|
|
Quoted
Prices in Active Markets for Identical Assets
|
|
|
Significant
Other Observable Inputs
|
|
|
Significant
Unobservable Inputs
|
|
|
|
|
|
|
|
Level
1
|
|
|
Level
2
|
|
|
Level
3
|
|
|
Impaired
loans
|
|
$
|
1,756
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,756
|
|
|
Real
estate owned
|
|
|
235
|
|
|
|
—
|
|
|
|
—
|
|
|
|
235
|
|
|
|
|
$
|
1,991
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,991
|
|
At March
31, 2009, impaired loans, which are measured for impairment using the fair value
of the collateral for collateral dependent loans, had valuation allowances of
$231,000 and a net carrying amount of $1.5 million. For the quarters
ended March 31, 2009 and 2008, additional provisions for loan loss of $120,000
and $0 were recorded on impaired loans. At December 31, 2008,
impaired loans had valuation allowances of $850,000 and a net carrying amount of
$1.8 million.
MUTUAL
FEDERAL BANCORP, INC.
NOTES TO UNAUDITED
CONSOLIDATED FINANCIAL STATEMENTS
Note
5 – Fair Value (continued)
Real
estate owned, acquired through foreclosure, is measured for impairment using the
fair value of the collateral, less estimated costs to sell. There
were no loss provisions for real estate acquired through foreclosure for the
quarters ended March 31, 2009 and 2008.
Note
6 – Earnings Per Share
Basic
earnings per share are computed by dividing income available to common
stockholders by the weighted average number of common shares outstanding for the
period. Diluted earnings per share reflects the potential dilution
that could occur if securities or other contracts to issue common stock were
exercised or converted into common stock or resulted in the issuance of common
stock that then shared in the earnings of the Company. Both basic and
fully diluted weighted average shares outstanding for the three months ended
March 31, 2009 and 2008, are 3,298,415 and 3,452,408,
respectively. During the three months ended March 31, 2009 and 2008,
the average fair value of the Company’s common stock was less than the exercise
price, and the stock option awards had no dilutive effect on earnings per
share.
In June
2008, the FASB issued FASB Staff Position EITF 03-6-1—
Determining Whether Instruments
Granted in Share-Based Payment Transactions Are Participating Securities
(FSP EITF 03-6-1). This FASB Staff Position (FSP) addresses whether instruments
granted in share-based payment transactions are participating securities prior
to vesting and, therefore, need to be included in the earnings allocation in
computing earnings per share (EPS) under the two-class method of FASB Statement
No. 128,
Earnings Per
Share
. FSP EITF 03-6-1 provides that unvested share-based
payment awards that contain non-forfeitable rights to dividends or dividend
equivalents (whether paid or unpaid) are participating securities and shall be
included in the computation of EPS pursuant to the two-class method. This FSP
was effective for financial statements issued for fiscal years beginning after
December 15, 2008, and interim periods within those years. Adoption of this
FSP did not impact the Company's EPS calculation as the Company's EPS
calculation has always considered stock grant awards under its Management
Recognition Plan (MRP) that remain subject to vesting to be outstanding stock
due to their dividend and voting rights.
The
factors used in the earnings per share computation for the three months ended
March 31, 2009 and 2008, follow:
|
(Dollar amounts in thousands,
except per share amounts)
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
|
|
Net
income (loss)
|
|
$
|
(210
|
)
|
|
$
|
15
|
|
|
Weighted
average common shares outstanding
|
|
|
3,368,780
|
|
|
|
3,528,508
|
|
|
Less: Average
unallocated ESOP shares
|
|
|
(70,365
|
)
|
|
|
(76,100
|
)
|
|
Average
shares
|
|
|
3,298,415
|
|
|
|
3,452,408
|
|
|
Basic
earnings (loss) per common share
|
|
$
|
(0.06
|
)
|
|
$
|
0.00
|
|
|
Diluted
|
|
|
|
|
|
|
|
|
|
Net
income (loss)
|
|
$
|
(210
|
)
|
|
$
|
15
|
|
|
Weighted
average common shares outstanding for basic earnings per common
share
|
|
|
3,298,415
|
|
|
|
3,452,408
|
|
|
Add: Dilutive
effects of assumed exercises of stock options
|
|
|
—
|
|
|
|
—
|
|
|
Average
shares and dilutive potential common shares
|
|
|
3,298,415
|
|
|
|
3,452,408
|
|
|
Diluted
earnings (loss) per common share
|
|
$
|
(0.06
|
)
|
|
$
|
0.00
|
|
Item
2.
Management’s Discussion and
Analysis of Financial Condition and Results of Operations
.
General
This
discussion and analysis reflects our consolidated financial statements and other
relevant statistical data and is intended to enhance your understanding of our
financial condition and results of operations. You should read the
information in this section in conjunction with our audited consolidated
financial statements for the years ended December 31, 2008 and 2007, which
are included in Form 10-K filed with the Securities and Exchange Commission on
March 27, 2009.
Forward-Looking
Information
This
report contains forward-looking statements, which can be identified by the use
of such words as estimate, project, believe, intend, anticipate, plan, seek,
expect and similar expressions. These forward-looking statements
include statements of our goals, intentions and expectations; statements
regarding our business plans and prospects and 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 subject to significant risks, assumptions and
uncertainties, including, among other things, the following important factors
that could affect the actual outcome of future events:
|
|
·
|
general
economic conditions, either nationally or in our market area, continue to
deteriorate or become worse than
expected;
|
|
|
·
|
adverse
changes or continued volatility and disruption in the securities and
credit markets;
|
|
|
·
|
deterioration
in asset quality due to adverse changes in the residential real estate
market;
|
|
|
·
|
inflation
and changes in the interest rate environment that reduce our margins or
reduce the fair value of financial instruments, which can decrease our
earnings;
|
|
|
·
|
any
need to increase our allowance for loan
losses;
|
|
|
·
|
charges
related to asset impairments;
|
|
|
·
|
adverse
developments in our loan or investment
portfolios;
|
|
|
·
|
significantly
increased competition among depository and other financial
institutions;
|
|
|
·
|
our
ability to enter new markets successfully and take advantage of growth
opportunities;
|
|
|
·
|
our
ability to successfully implement our business
plan;
|
|
|
·
|
legislative
or regulatory changes that adversely affect our
business;
|
|
|
·
|
changes
in consumer spending, borrowing and savings
habits;
|
|
|
·
|
changes
in accounting policies and practices, as may be adopted by the bank
regulatory agencies, the Financial Accounting Standards Board and the
PCAOB; and
|
|
|
·
|
changes
in our organization, compensation and benefit
plans.
|
These
risks and uncertainties should be considered in evaluating forward-looking
statements, and undue reliance should not be placed on such
statements. Because of these and other uncertainties, our actual
future results may be materially different from the results indicated by these
forward-looking statements.
Overview
Our
results of operations depend primarily on our net interest
income. Net interest income is the difference between the interest
income we earn on our interest-earning assets, consisting primarily of loans,
U.S. government and agency securities, mortgage-backed securities and other
interest earning assets (primarily cash and cash equivalents), and the interest
we pay on our interest-bearing liabilities, consisting of savings accounts, time
deposits, and advances from the Federal Home Loan Bank. Our results
of operations are also affected by our provisions for loan losses, non-interest
income and non-interest expense. Non-interest income consists
primarily of miscellaneous fees and charges on loan and deposit accounts, and
changes in the fair value of trading securities. Non-interest expense
currently consists primarily of salaries and employee benefits, occupancy, data
processing, professional fees, and other operating expenses. Our
results of operations also may be affected significantly by general and local
economic and competitive conditions, changes in market interest rates,
governmental policies and actions of regulatory authorities.
Throughout
2008 and continuing into 2009, there have been severe disruptions in the
mortgage, credit and housing markets, both locally and
nationally. These disruptions have had a significant negative impact
on real estate and related industries, which has led to decreases in commercial
and residential real estate sales, construction and property
values. These disruptions have had a significant negative impact on
the Bank’s loan portfolio, resulting in a reduction in demand for new loans,
with a consequential effect in the size of our loan portfolio, and an increase
in the number of non-performing loans. At March 31, 2009 and December
31, 2008, non-performing loans represented 3.47% and 5.59% of gross loans,
respectively, which is significantly in excess of the historical experience of
the Bank. We also recorded net loan charge-offs of $727,000 on
foreclosed mortgages during the first quarter of 2009 compared to no charge-offs
for the first quarter of 2008. Accordingly, the decreased demand for
new residential mortgage loans and the significant increase in non-performing
loans, including increased fees and expenses related to foreclosed property,
continues to have a material adverse impact on our financial condition and
results of operations, including a contraction in net interest margin and the
need to increase the provision for loan losses. Should the housing
market and economic conditions in the Chicago-area stagnate or continue to
deteriorate, it may continue to have a negative effect on the Company’s business
and results of operations.
Critical
Accounting Policies
We
consider accounting policies involving significant judgments and assumptions by
management that have, or could have, a material impact on the carrying value of
certain assets or on income to be critical accounting policies. We
consider our critical accounting policies to be those related to our allowance
for loan losses.
The
allowance for loan losses is the estimated amount considered necessary to cover
probable incurred losses in the loan portfolio at the balance sheet
date. The allowance is established through a provision for loan
losses that is charged against income. In determining the allowance
for loan losses, management makes significant estimates and has identified this
policy as one of our most critical.
Management
performs a quarterly evaluation of the adequacy of the allowance for loan
losses. We consider a variety of factors in establishing this
estimate including, but not limited to, current economic conditions, delinquency
statistics, geographic and industry concentrations, the adequacy of the
underlying collateral, the financial strength of the borrower, results of
internal loan reviews and other relevant factors. This evaluation is
inherently subjective as it requires material estimates that may be subject to
significant change.
The
analysis has two components: specific and general
allocations. Specific allocations are made for loans that are
determined to be impaired. Impairment is measured by determining the
present value of expected future cash flows or, for collateral-dependent loans,
the fair value of the collateral adjusted for market conditions and selling
expenses. The general allocation is determined by segregating the
remaining loans by type of loan, risk weighting (if applicable) and payment
history. We also analyze historical loss experience, delinquency
trends, general economic conditions and geographic and industry
concentrations. This analysis establishes factors that are applied to
the loan groups to determine the amount of the general allowance for loan
losses. Actual loan losses may be significantly more than the
allowances we have established which could have a material negative effect on
our financial results.
Comparison
of Financial Condition at March 31, 2009 and December 31,
2008
Our total
assets decreased $360,000, or 0.5%, to $70.8 million at March 31, 2009,
from $71.2 million at December 31, 2008. Loans receivable
decreased $2.4 million, or 4.7%, to $49.0 million at March 31, 2009, from
$51.5 million at December 31, 2008. There were $925,000 in
transfers of one-to-four family properties to real estate owned, acquired
through foreclosure, and $587,000 in net repayments on one-to-four family
residential mortgages during the three months ended March 31,
2009. There were net repayments of $704,000 on multi-family
residential mortgages during this same period. The allowance for loan
losses decreased $532,000, to $755,000 at March 31, 2009, from $1.3 million at
December 31, 2008, following net charge-offs of $727,000 on foreclosed
one-to-four family residential mortgages and a provision for loan losses of
$195,000 for the quarter.
Total
deposits increased $1.1 million, or 2.9%, to $39.6 million at March 31,
2009, from $38.5 million at December 31, 2008. Stockholders’
equity decreased $666,000,or 2.7%, to $24.0 million at March 31,
2009, from $24.8 million at December 31, 2008. The decrease
reflects a net loss of $210,000 for the quarter, treasury stock purchases of
$588,000, dividends paid of $51,000, a $19,000 increase in accumulated other
comprehensive income from net unrealized gains on securities available-for-sale,
an $83,000 increase from recognition of stock benefits earned under the
Company’s Employee Stock Ownership Plan, Management Recognition and Retention
Plan, and Stock Option Plan, and a $7,000 reclassification due to the commitment
for release and change in fair value of common stock in the ESOP subject to the
contingent repurchase obligation of ESOP shares.
Comparison
of Operating Results for the Three Months Ended March 31, 2009 and
2008
General
. Net
income decreased $225,000, to a net loss of $210,000 for the three months ended
March 31, 2009, from net income of $15,000 for the three months ended
March 31, 2008. Net interest income decreased $26,000, or
3.8%,to $667,000 for the three months ended March 31, 2009, from $693,000 for
the three months ended March 31, 2008. The provision for losses on
loans increased, to $195,000 for the three months ended March 31, 2009, from
$40,000 in the first quarter of 2008.
Changes
in the fair value of trading securities resulted in losses of $50,000 for the
three months ended March 31, 2009, compared to losses of $8,000 for the three
months ended March 31, 2008.
Compensation
and benefits increased $13,000, or 3.5%, to $386,000 for the three months ended
March 31, 2009, from $373,000 for the three months ended March 31, 2008,
primarily due to salary increases in the normal course of
business. Professional fees increased $53,000, or 45.3%, to $170,000
for the three months ended March 31, 2009, from $117,000 for the three months
ended March 31, 2008, primarily due to a $48,000 increase in legal fees from
loan foreclosures. Miscellaneous expenses also increased $53,000, or
73.6%, to $125,000 for the quarter ended March 31, 2009, from $72,000 for the
quarter ended March 31, 2008, primarily due to $43,000 in real estate taxes on
foreclosed real estate owned.
The
annualized return on average assets was (1.18)% for the three months ended
March 31, 2009, compared to 0.08% for the same period last year, and the
annualized return on equity was (3.45)% and 0.22%, respectively, for these
two periods.
Interest
Income
. Interest and dividend income decreased $102,000, or
9.9%, to $925,000 for the three months ended March 31, 2009, compared to
$1.0 million for the three months ended March 31, 2008. The decrease
resulted from the $4.0 million, or 5.7%, decrease in the average balance of
interest-earning assets, to $66.9 million in the first quarter of 2009, compared
to $70.9 million in the first quarter of 2008, and to a decrease of 26 basis
points in the average yield on interest earning assets, to 5.53% in 2009, from
5.79% in 2008. In addition, it is the Company’s policy to reserve all
accrued interest on loans 90 days or more delinquent, which resulted in a
$54,000 reduction in interest income on loans during the first quarter of 2009,
compared to a $36,000 decrease during the first quarter of 2008.
Interest
income and fees from loans receivable decreased $37,000, or 4.5%, to $786,000
for the three months ended March 31, 2009, from $823,000 for the three
months ended March 31, 2008. The primary reasons for the
decrease were the increase in the reserve for uncollected interest and the $1.9
million, or 3.6%, decrease in the average balance of loans receivable, to $50.6
million in the first quarter of 2009, compared to $52.5 million in the first
quarter of 2008. The average yield on loans receivable decreased 6
basis points, to 6.21% in 2009, from 6.27% in 2008.
Interest
and dividend income from securities, FHLB stock, and interest-earning deposits
decreased $65,000, or 31.9%, to $139,000 for the three months ended
March 31, 2009, from $204,000 for the three months ended March 31,
2008. The primary reasons for the decrease were the decrease in
average balances of securities, FHLB stock, and interest-earning deposits
of $2.1 million, or 11.7%, to $16.3 million in 2009, from $18.4 million in 2008,
and a 101 basis point decrease in average yield to 3.42% in 2009, from 4.43% in
2008. In addition, the FHLB of Chicago suspended its dividend in
2007, and the Federal Home Loan Mortgage Corporation suspended dividends on its
common and preferred stock in 2008. The Company cannot predict when
or if either entity will resume dividend payments. During the quarter
ended March 31, 2008, dividends from FHLMC amounted to $9,000. The
Company still owns 10,000 shares of FHLMC preferred stock with an adjusted
carrying balance of $7,000.
Interest
Expense
. Interest expense on deposits decreased $68,000, or
25.0%, to $204,000 for the three months ended March 31, 2009, from $272,000
for the three months ended March 31, 2008. The decrease in
interest expense was due primarily to a 67 basis point decrease in the average
rate paid on deposits, to 2.10% for the quarter ended March 31, 2009, from
2.77% for the quarter ended March 31, 2008. Interest expense on
certificates of deposit decreased $68,000, or 31.63%, to $147,000 in 2009, from
$215,000 in 2008, primarily due to a 125 basis point decrease in the average
rate paid, to 2.92% in 2009, from 4.17% in 2008.
Interest
expense on FHLB advances decreased $8,000, to $54,000 for the three months ended
March 31, 2009, compared to $62,000 for the three months ended March 31,
2008. The average balance of FHLB advances increased $385,000, to
$6.0 million for the first quarter of 2009, from $5.6 million for the first
quarter of 2008. The rate paid on advances decreased 82 basis points, to 3.60%
in 2009, from 4.42% in 2008. The overall average cost of funds
decreased 68 basis points, to 2.30% in 2009, from 2.98% in 2008.
Net Interest
Income
. Net interest income decreased $26,000, or 3.8%, to
$667,000 for the three months ended March 31, 2009, from $693,000 for the
same quarter last year. Our net interest margin increased 8 basis
points, to 3.99% in 2009, from 3.91% in 2008. The average yield on
interest-earning assets decreased 26 basis points, to 5.53% in 2009, from 5.79%
in 2008, and the average balance of interest-earning assets decreased $4.0
million, or 5.7%, from the comparable prior-year period. Both
decreases contributed to interest income decreasing by $102,000. The
average rate paid on interest-
bearing
liabilities decreased, to 2.30% in 2009, from 2.98% in 2008, and the average
balance of interest-bearing liabilities increased $80,000, with interest expense
decreasing by $76,000. The interest rate spread between
interest-earning assets and interest-bearing liabilities increased 42 basis
points, to 3.23% in 2009, from 2.81% in 2008.
Provision for Loan
Losses
. During the three months ended March 31, 2009,
management made an additional $195,000 provision for losses on loans, based on
its quarterly evaluation of the level of the allowance necessary to absorb
probable incurred loan losses at March 31, 2009. Management
considers changes in delinquencies, changes in the composition and volume of
loans, historical loan loss experience, general economic and real estate market
conditions, as well as peer group data, when determining the level on the
allowance for loan losses.
During
the three months ended March 31, 2009, non-performing (non-accrual) loans
decreased to $1.7 million, from $3.0 million at December 31,
2008. Loans delinquent 60-89 days were $2.2 million at March 31,
2009, approximately the same as they were at December 31,
2008. Loans receivable decreased $2.4 million, or 4.7%, to $49.0
million at March 31, 2009, from $51.5 million at December 31,
2008.
There
were $925,000 in transfers of one-to-four family properties to real estate
owned, acquired through foreclosure, during the first quarter of
2009. The allowance for loan losses decreased $532,000, to $755,000
at March 31, 2009, from $1.3 million at December 31, 2008, following net
charge-offs of $727,000 on foreclosed one-to-four family residential mortgages
and a provision of $195,000 for the quarter. There were no loan
charge-offs during the first quarter of 2008. Impaired loans, which
are measured for impairment using the fair value of the collateral for
collateral-dependent loans, had a carrying amount of $2.1 million, with specific
valuation allowances of $231,000 at March 31, 2009.
At
March 31, 2009, the allowance for loan losses was $755,000, or 1.51% of
gross loans receivable, compared to $1.3 million, or 2.43% of gross loans
receivable at December 31, 2008. At March 31, 2009, the
allowance for loan losses was 43.6% of non-performing loans, compared to 43.6%
at December 31, 2008. In a similar evaluation of the allowance for
loan losses at March 31, 2008, management determined that there was a need
for a $40,000 provision for the three months then ended.
Non-interest
Income
. Non-interest income decreased $43,000, to a loss of
$40,000 for the three month period ended March 31, 2009, compared to income
of $3,000 for the three months ended March 31, 2008. The decrease was
due to a $50,000 fair value loss adjustment to various mutual funds carried as
trading securities and accounted for under FASB Statement No. 159,
The Fair Value Option for Financial
Assets and Financial Liabilities,
for the three months ended March 31,
2009, compared to an $8,000 loss adjustment for the three months ended March 31,
2008.
Non-interest
Expense
. Non-interest expense increased $132,000, or 21.0%, to
$760,000 for the three months ended March 31, 2009, from $628,000 for the
same quarter last year. Compensation and employee benefits increased
$13,000, or 3.5%, to $386,000 in 2009, from $373,000 in 2008, primarily due to
salary increases in the ordinary course of business.
Occupancy
costs increased $5,000, or 12.5%, to $45,000 in 2009, from $40,000 in 2008,
primarily due to building maintenance costs. Data processing fees
increased $8,000, or 30.8%, to $34,000 in 2009, from $26,000 in 2008, primarily
due to new products and services being offered, including interest-bearing
checking accounts and on-line banking. Professional fees, including
legal, accounting and consulting fees, increased $53,000, or 45.3%, to $170,000
in 2009, from $117,000 in 2008, primarily due to a $48,000 increase in legal
fees from loan foreclosures. Miscellaneous expenses increased
$53,000, or 73.6%, to $125,000 for the first quarter of 2009, from $72,000 for
the first quarter of 2008, primarily due to $43,000 in accrued real estate taxes
on foreclosed real estate owned.
The
Company’s ratio of non-interest expense to average assets increased to 4.28% in
the first quarter of 2009, from 3.40% in 2008, and its efficiency ratio was
112.3% in 2009, compared to 89.2% in 2008.
Income Tax
Expense
. The provision for income taxes decreased $131,000, to
a benefit of $118,000 in 2009, from an expense of $13,000 in 2008, largely due
to the $356,000 decrease in pre-tax income, to a loss of $328,000 in 2009, from
income of $28,000 in 2008. The effective tax rate for the quarter
ended March 31, 2009, decreased to 36.0%, compared to 46.4% for this
quarter last year. The decrease in the effective rate was due
primarily to nondeductible expenses associated with stock benefit
plans.
Average
Balance Sheet
The
following table sets forth average balance sheets, average annualized yields and
costs, and certain other information for the three months ended March 31,
2009 and 2008. No tax-equivalent yield adjustments were made, as
their effects were not material. All average balances are based on an
average of daily balances. Non-accrual loans are included in the
computation of average balances, but have been reflected in the table as loans
carrying a zero yield. The yields set forth below include the effect
of deferred fees, discounts and premiums that are amortized or accreted to
interest income or expense.
|
|
|
For
the Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
Outstanding Balance
|
|
|
|
|
|
|
|
|
Average
Outstanding Balance
|
|
|
|
|
|
|
|
|
Interest-earning assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
|
|
$
|
50,634
|
|
|
$
|
786
|
|
|
|
6.21
|
%
|
|
$
|
52,520
|
|
|
$
|
823
|
|
|
|
6.27
|
%
|
|
Securities
available for
sale
|
|
|
12,195
|
|
|
|
139
|
|
|
|
4.56
|
|
|
|
15,800
|
|
|
|
189
|
|
|
|
4.78
|
|
|
Interest-earning
deposits
|
|
|
3,463
|
|
|
|
—
|
|
|
|
0.00
|
|
|
|
2,004
|
|
|
|
15
|
|
|
|
2.99
|
|
|
Federal
Home Loan Bank
Stock
|
|
|
610
|
|
|
|
—
|
|
|
|
0.00
|
|
|
|
610
|
|
|
|
—
|
|
|
|
0.00
|
|
|
Total
interest-earning
assets
|
|
|
66,902
|
|
|
$
|
925
|
|
|
|
5.53
|
%
|
|
|
70,934
|
|
|
$
|
1,027
|
|
|
|
5.79
|
%
|
|
Non-interest-earning
assets
|
|
|
4,126
|
|
|
|
|
|
|
|
|
|
|
|
2,943
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
71,028
|
|
|
|
|
|
|
|
|
|
|
$
|
73,877
|
|
|
|
|
|
|
|
|
|
|
Interest-Bearing
Liabilities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings
deposits
|
|
$
|
18,788
|
|
|
$
|
57
|
|
|
|
1.21
|
%
|
|
$
|
18,611
|
|
|
$
|
57
|
|
|
|
1.23
|
%
|
|
Certificates
of deposit
|
|
|
20,126
|
|
|
|
147
|
|
|
|
2.92
|
|
|
|
20,608
|
|
|
|
215
|
|
|
|
4.17
|
|
|
Total
interest-bearing
deposits
|
|
|
38,914
|
|
|
|
204
|
|
|
|
2.10
|
|
|
|
39,219
|
|
|
|
272
|
|
|
|
2.77
|
|
|
Federal
Home Loan Bank
advances
|
|
|
6,000
|
|
|
|
54
|
|
|
|
3.60
|
|
|
|
5,615
|
|
|
|
62
|
|
|
|
4.42
|
|
|
Total
interest-bearing
liabilities
|
|
|
44,914
|
|
|
|
258
|
|
|
|
2.30
|
%
|
|
|
44,834
|
|
|
|
334
|
|
|
|
2.98
|
%
|
|
Non-interest-bearing
liabilities
|
|
|
3,474
|
|
|
|
|
|
|
|
|
|
|
|
1,854
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
48,388
|
|
|
|
|
|
|
|
|
|
|
|
46,688
|
|
|
|
|
|
|
|
|
|
|
Stockholders’
equity
|
|
|
22,640
|
|
|
|
|
|
|
|
|
|
|
|
27,189
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities and
stockholders’
equity
|
|
$
|
71,028
|
|
|
|
|
|
|
|
|
|
|
$
|
73,877
|
|
|
|
|
|
|
|
|
|
|
Net
interest income
|
|
|
|
|
|
$
|
667
|
|
|
|
|
|
|
|
|
|
|
$
|
693
|
|
|
|
|
|
|
Net
interest rate spread
(2)
|
|
|
|
|
|
|
|
|
|
|
3.23
|
%
|
|
|
|
|
|
|
|
|
|
|
2.81
|
%
|
|
Net
interest-earning
assets
(3)
|
|
$
|
21,988
|
|
|
|
|
|
|
|
|
|
|
$
|
26,100
|
|
|
|
|
|
|
|
|
|
|
Net
interest margin
(4)
|
|
|
|
|
|
|
|
|
|
|
3.99
|
%
|
|
|
|
|
|
|
|
|
|
|
3.91
|
%
|
|
Ratio
of interest-earning
assets
to interest-
bearing
liabilities
|
|
|
|
|
|
|
|
|
|
|
148.96
|
%
|
|
|
|
|
|
|
|
|
|
|
158.21
|
%
|
|
(1)
|
Non-interest-bearing
checking deposits are included in non-interest-bearing
liabilities.
|
|
(2)
|
Net
interest rate spread represents the difference between the yield on
average interest-earning assets and the cost of average interest-bearing
liabilities.
|
|
(3)
|
Net
interest-earning assets represents total interest-earning assets less
total interest-bearing liabilities.
|
|
(4)
|
Net
interest margin represents net interest income divided by average total
interest-earning assets.
|
Liquidity
and Capital Resources
We
maintain liquid assets at levels we consider adequate to meet our liquidity
needs. We adjust our liquidity levels to fund deposit outflows, to
pay real estate taxes on mortgage loans, to repay our borrowings and to fund
loan commitments. We also adjust liquidity as appropriate to meet
asset and liability management objectives.
Our
primary sources of liquidity are deposits, amortization and prepayment of loans,
maturities of investment securities and other short-term investments, and
earnings and funds provided from operations.
While
scheduled principal repayments on loans are a relatively predictable source of
funds, deposit flows and loan prepayments are greatly influenced by market
interest rates, economic conditions, and rates offered by our
competition. We set the interest rates on our deposits to maintain a
desired level of total deposits. In addition, we invest excess funds
in short-term interest-earning assets, which provide liquidity to meet lending
requirements.
A portion
of our liquidity consists of cash and cash equivalents, which are a product of
our operating, investing and financing activities. At March 31,
2009, $5.7 million of our assets were invested in cash and cash
equivalents. Our primary sources of cash are principal repayments on
loans, proceeds from the calls and maturities of investment securities,
increases in deposit accounts, and FHLB advances. Our cash flows are
derived from operating activities, investing activities and financing activities
as reported in our consolidated statements of cash flows.
Our
primary investing activities are the origination of loans and the purchase of
investment securities. During the three months ended March 31,
2009 and 2008, collected principal payments exceeded our originations by $1.3
million and $740,000, respectively. We do not sell
loans. Cash received from principal repayments, calls and maturities
of securities totaled $407,000 and $949,000 for the three months ended
March 31, 2009 and 2008, respectively. During the three months
ended March 31, 2009, we sold shares in three mutual funds for proceeds of
$750,000, incurring a realized loss of $174,000, in order to reduce our exposure
to these securities. We did not purchase any securities during the
three months ended March 31, 2009 or 2008.
Deposit
flows are generally affected by the level of interest rates, the interest rates
and products offered by us and by local competitors, and other
factors. There was a net increase in total deposits of $1.0 million
for the three months ended March 31, 2009, and a net increase of $40,000 in
2008. The increase in deposits during the first quarter was
attributed primarily to re-intermediation from the securities
markets.
Liquidity
management is both a daily and long-term function of business
management. If we require funds beyond our ability to generate them
internally, borrowing agreements exist with the Federal Home Loan Bank of
Chicago, which provide an additional source of funds. Our available
borrowing limit through the Federal Home Loan Bank of Chicago at March 31,
2009, was $12.2 million (an additional $6.2 million).
At
March 31, 2009, we had outstanding commitments to make loans of
$95,000. At March 31, 2009, certificates of deposit scheduled to
mature in less than one year totaled $18.5 million. Based on prior
experience, management believes that a significant portion of such deposits will
remain with us, although there can be no assurance that this will be the
case. In the event we do not retain a significant portion of our
maturing certificates of deposit, we will have to utilize other funding sources,
such as Federal Home Loan Bank of Chicago advances, in order to maintain our
level of assets. Alternatively, we would reduce our level of liquid
assets, such as our cash and cash equivalents. In addition, the cost
of such deposits may be significantly higher if market interest rates are higher
at the time of renewal.
Off-Balance
Sheet Arrangements
In the
ordinary course of business, the Company is a party to credit-related financial
instruments with off-balance-sheet risk to meet the financing needs of its
customers. These financial instruments include commitments to extend
credit. The Company follows the same credit policies in making
commitments as it does for on-balance-sheet instruments.
Commitments
to extend credit are agreements to lend to a customer as long as there is no
violation of any condition established in the contract. Commitments
generally have fixed expiration dates
or other
termination clauses and may require payment of a fee. Therefore, the
total commitment amounts do not necessarily represent future cash
requirements.
We had
outstanding commitments to make loans of $95,000 at March 31, 2009. We had no
commitments to make loans at December 31, 2008.
Impact
of Inflation and Changing Prices
Our
financial statements and related notes have been prepared in accordance with
U.S. generally accepted accounting principles (“GAAP”). GAAP
generally requires the measurement of financial position and operating results
in terms of historical dollars without consideration for changes in the relative
purchasing power of money over time due to inflation. The impact of
inflation is reflected in the increased cost of our
operations. Unlike industrial companies, our assets and liabilities
are primarily monetary in nature. As a result, changes in market
interest rates have a greater impact on performance than the effects of
inflation.
Management
of Market Risk
General
. The
majority of our assets and liabilities are monetary in
nature. Consequently, our most significant form of market risk is
interest rate risk. Our assets, consisting primarily of mortgage
loans, have longer maturities than our liabilities, which consist primarily of
deposits. As a result, a principal part of our business strategy is
to manage interest rate risk and reduce the exposure of our net interest income
to changes in market interest rates. Our board of directors has
approved a series of policies for evaluating interest rate risk inherent in our
assets and liabilities; for determining the level of risk that is appropriate
given our business strategy, operating environment, capital, liquidity and
performance objectives; and for managing this risk consistent with these
policies. Senior management regularly monitors the level of interest
rate risk and reports to the board of directors on our compliance with our
asset/liability policies and on our interest rate risk position.
We have
sought to manage our interest rate risk in order to control the exposure of our
earnings and capital to changes in interest rates. During the low
interest rate environment that has existed in recent years, we have managed our
interest rate risk by maintaining a high equity-to-assets ratio and building and
maintaining portfolios of shorter-term fixed rate residential loans and second
mortgage loans. By maintaining a high equity-to-assets ratio, we
believe that we are better positioned to absorb more interest rate risk in order
to improve our net interest margin. However, maintaining high equity
balances reduces our return on equity ratio, and investments in shorter-term
assets generally bear lower yields than longer-term investments.
Net Portfolio
Value
. In past years, many savings institutions have measured
interest rate sensitivity by computing the “gap” between the assets and
liabilities that are expected to mature or reprice within certain time periods,
based on assumptions regarding loan prepayment and deposit decay rates formerly
provided by the OTS. However, the OTS now requires the computation of
amounts by which the net present value of an institution’s cash flow from
assets, liabilities and off balance sheet items (the institution’s net portfolio
value or “NPV”) would change in the event of a range of assumed changes in
market interest rates. The OTS provides all institutions that file a
Consolidated Maturity/Rate Schedule as a part of their quarterly Thrift
Financial Report with an interest rate sensitivity report of net portfolio
value. The OTS simulation model uses a discounted cash flow analysis
and an option-based pricing approach to measuring the interest rate sensitivity
of net portfolio value. Historically, the OTS model estimated the
economic value of each type of asset, liability and off-balance sheet contract
under the assumption that the United States Treasury yield curve increases or
decreases instantaneously by 100 to 300 basis points in 100 basis point
increments. A basis point equals one-hundredth of one percent, and
100 basis points equals one percent. An increase in interest rates
from 3% to 4% would mean, for
example,
a 100 basis point increase in the “Change in Interest Rates” column
below. The OTS provides us the results of the interest rate
sensitivity model, which is based on information we provide to the OTS to
estimate the sensitivity of our net portfolio value.
The table
below sets forth, as of December 31, 2008, the latest date available, the
estimated changes in our NPV and our net interest income that would result from
the designated instantaneous changes in the U.S. Treasury yield
curve. Computations of prospective effects of hypothetical interest
rate changes are based on numerous assumptions including relative levels of
market interest rates, loan prepayments and deposit decay, and should not be
relied upon as indicative of actual results.
|
Change In
|
|
|
|
|
|
Net
Portfolio Value as a
Percentage
of Present Value of
Assets
|
|
Interest
Rates
(Basis
Points)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars
in thousands)
|
|
|
|
|
|
|
|
|
|
|
+300
|
|
|
$
|
20,470
|
|
|
$
|
(4,954
|
)
|
|
|
-19
|
%
|
|
|
29.72
|
%
|
|
|
-436
|
bp
|
|
|
+200
|
|
|
|
22,330
|
|
|
|
(3,094
|
)
|
|
|
-12
|
|
|
|
31.46
|
|
|
|
-262
|
|
|
|
+100
|
|
|
|
24,000
|
|
|
|
(1,423
|
)
|
|
|
-6
|
|
|
|
32.92
|
|
|
|
-116
|
|
|
|
+50
|
|
|
|
24,727
|
|
|
|
(697
|
)
|
|
|
-3
|
|
|
|
33.52
|
|
|
|
-56
|
|
|
Unchanged
|
|
|
|
25,423
|
|
|
|
—
|
|
|
|
—
|
|
|
|
34.08
|
|
|
|
—
|
|
|
|
-50
|
|
|
|
26,055
|
|
|
|
631
|
|
|
|
+2
|
|
|
|
34.57
|
|
|
|
+49
|
|
|
|
-100
|
|
|
|
26,630
|
|
|
|
1,207
|
|
|
|
+5
|
|
|
|
35.01
|
|
|
|
+93
|
|
The table
above indicates that at December 31, 2008, in the event of a 100 basis
point decrease in interest rates, we would experience a 5% increase in net
portfolio value. In the event of a 200 basis point increase in
interest rates, we would experience a 12% decrease in net portfolio
value.
Certain
shortcomings are inherent in the methodology used in the above interest rate
risk measurement. Modeling changes in net portfolio value requires
making certain assumptions that may or may not reflect the manner in which
actual yields and costs respond to changes in market interest
rates. In this regard, the net portfolio value table presented
assumes that the composition of our interest-sensitive assets and liabilities
existing at the beginning of a period remains constant over the period being
measured and assumes that a particular change in interest rates is reflected
uniformly across the yield curve regardless of the duration or repricing of
specific assets and liabilities. Accordingly, although the net
portfolio value table provides an indication of our interest rate risk exposure
at a particular point in time, such measurements do not provide a precise
forecast of the effect of changes in market interest rates on net interest
income and will differ from actual results.
Item
3.
Quantitative and Qualitative
Disclosures About Market Risk
Disclosure
for this item is currently not required for smaller reporting companies on an
interim basis.
Item
4.
Controls and
Procedures
As of the
end of the period covered by this report, we carried out an evaluation, under
the supervision, and with the participation of our management, including our
Chief Executive Officer and Chief Financial Officer, of the effectiveness of the
design and operation of our disclosure controls and procedures as contemplated
by Exchange Act Rule 13a-15. Based upon, and as of the date of
that
evaluation,
the Chief Executive Officer and Chief Financial Officer concluded that, as of
the end of the period covered by this report, the Company’s disclosure controls
and procedures are effective, in all material respects, in timely alerting them
to material information relating to the Company (and its consolidated
subsidiaries) required to be included in the periodic reports the Company is
required to file and submit to the Securities and Exchange Commission under the
Exchange Act.
There
have been no changes in the Company’s internal controls during the period
covered by this report that have materially affected, or are reasonably likely
to materially affect, the Company’s internal controls over financial
reporting.
PART
II. – OTHER INFORMATION
Item
1.
Legal
Proceedings
.
The
Company and the Bank are not involved in any pending proceedings other than the
legal proceedings occurring in the ordinary course of business. Such
legal proceedings in the aggregate are believed by management to be immaterial
to the Company’s business, financial condition, results of operations and cash
flows.
Item
1A.
Risk
Factors
.
The
Company has included in Part I, Item 1A of its Annual Report on Form 10-K for
the year ended December 31, 2008, descriptions of certain risks and
uncertainties that could affect the Company’s business, operating results and
financial condition (“Risk Factors”). In addition to all the other
information contained in the reports the Company files with the SEC, including
in this Form 10-Q, investors should consider the risks described in the Risk
Factors prior to making an investment decision with respect to the Company’s
stock. The risks described in our Risk Factors, however, are not the
only risks facing the Company. Additional risks and uncertainties not
currently known to us or that we currently consider immaterial also may
materially adversely affect our business, financial condition and/or operating
results.
Item
2.
Unregistered Sales of Equity
Securities and Use of Proceeds
.
|
|
|
Total
number of shares purchased
|
|
|
Average
price paid per share
|
|
|
Total
number of shares purchased as part of publicly announced plans or
programs
|
|
|
Maximum
number of shares that may yet be purchased under the plans or
programs
(1)
|
|
|
1/1/09–1/31/09
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
67,044
|
|
|
2/1/09–2/28/09
|
|
|
57,044
|
|
|
$
|
8.89
|
|
|
|
57,044
|
|
|
|
10,000
|
|
|
3/1/09–3/31/09
|
|
|
10,000
|
|
|
$
|
8.05
|
|
|
|
10,000
|
|
|
|
—
|
|
|
(1)
|
On
May 29, 2008 the Company announced that its Board of Directors had
approved a stock repurchase program that authorized the purchase of up to
5%, or 175,500 shares, of the Company’s then outstanding shares of common
stock, from time to time in open market or privately negotiated
transactions. The Company has repurchased all 175,500 shares
and the current stock repurchase plan has
ended.
|
Item
3.
Defaults Upon Senior
Securities
.
None
Item
4.
Submission of Matters to a
Vote of Security Holders
.
No
matters were submitted to a vote of stockholders of the Company during the first
quarter of 2009.
Item
5.
Other
Information
.
None
Item
6.
Exhibits
.
The
exhibits filed as part of this Form 10-Q are listed in the Exhibit Index,
which is incorporated herein by reference.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
|
Date:
May 12, 2009
|
MUTUAL FEDERAL BANCORP,
INC.
|
|
|
|
|
|
|
|
|
By:
|
/s/
Stephen M.
Oksas
|
|
|
|
|
Stephen
M. Oksas
|
|
|
|
|
President
and Chief Executive Officer
|
|
|
|
|
|
|
|
Date:
May 12, 2009
|
|
|
|
|
By:
|
/s/
John L.
Garlanger
|
|
|
|
|
John
L. Garlanger
|
|
|
|
|
|
|
|
|
|
|
|
EXHIBIT
INDEX
|
31.1
|
Certification
of Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
|
31.2
|
Certification
of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
|
|
32.1
|
Certification
of Chief Executive Officer and Chief Financial Officer pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
|
Mutual Federal Bancorp (PK) (USOTC:MFDB)
Gráfica de Acción Histórica
De Dic 2024 a Ene 2025
Mutual Federal Bancorp (PK) (USOTC:MFDB)
Gráfica de Acción Histórica
De Ene 2024 a Ene 2025
