Banking & Finance

UCFC Reports Record Second-Quarter Net Income

YOUNGSTOWN, Ohio – United Community Financial Corp., holding company of Home Savings Bank and the James & Sons Insurance agency, Tuesday reported second-quarter net income of $8.2 million, or 16.3 cents per basic share.

The $8.2 million, UCFC noted, is a record for second-quarter earnings.

First-quarter net income was $1.54 million, or 3.2 cents per basic share, and a 45.5% improvement from year-ago income of $5.33 million, or 11.2 cents per basic share.

UCFC directors declared a cash dividend of four cents per share payable Aug. 11 to shareholders of record July 28. The dividend is a penny per share increase.

In a prepared statement, the president and CEO of UCFC and Home Savings Bank, Gary M. Small, said, “The results for the quarter reflect the successful efforts of the entire Home Savings team. Outstanding earnings were driven by strong revenue growth combined with a disciplined approach to managing the business. We continue to see very good opportunities across all our markets and business lines and believe the quarterly performance to be reflective of the organization’s capabilities going forward.”

Key financial ratios for the quarters ended June 30, March 31 and June 30, 2016:

  • Return on average assets, 1.27%, 0.25%, 1.04%.
  • Return on average equity, 11.60%, 2.24%, 8.63%.
  • Net interest margin, 3.46%, 3.28%, 3.25%.
  • Efficiency ratio, 54.71%, 83.78%, 60.81%.

Total loans, including those held for sale, stood at $1.97 billion at June 30 compared to $1.93 billion at March 31.

Total nonperforming loans (those 90 and more days past due) were at $842,000, up from $447,000 the year–ago quarter.

Net interest income was $20.5 million, up from $18.5 million at March 31 and $15.3 million at the second quarter of 2016.

Total noninterest income (includes insurance agency income, brokerage income and debit and credit card fees) was $7.1 million, up 22.7% from the $5.3 million reported at March 31 and the $5.8 million the year-ago quarter.

Noninterest expense (salaries and employee benefits, rents, data processing, acquisition-related, marketing, professional fees and Federal Deposit Insurance Corp. premiums) was $15.2 million, down 25.2% from $20.3 million the first quarter but up from $12.9 million the year-ago quarter.

Excluding the $5.0 million in acquisition expense for Ohio Legacy Corp., parent of Premier Bank & Trust, earlier this year, noninterest income was down $152,000 compared to the first quarter, UCFC said.

The ratio of nonperforming loans $10.78 million to net loans ($1.944 billion) improved 0.58%, down from 1.45% a year ago, UCFC noted. And the company allowance for loan losses to total loans was 1.04% at June 30 compared to 1.21% a year ago.

Published by The Business Journal, Youngstown, Ohio.