SOUTHERN MISSOURI BANCORP REPORTS PRELIMINARY FIRST QUARTER RESULTS, DECLARES QUARTERLY DIVIDEND OF $0.09 PER COMMON SHARE, SCHEDULES CONFERENCE CALL TO DISCUSS RESULTS FOR TUESDAY, OCTOBER 27, AT 3:30PM CDT

Poplar Bluff, Oct. 26, 2015 (GLOBE NEWSWIRE) — http://www.globenewswire.com/NewsRoom/AttachmentNg/91425122-7cf1-470b-9fc2-c7fda86ad033

FOR IMMEDIATE RELEASE Contact: Matt Funke, CFO
October 26, 2015 (573) 778-1800


Poplar Bluff, Missouri – Southern Missouri Bancorp, Inc. (“Company”) (NASDAQ: SMBC), the parent corporation of Southern Bank (“Bank”), today announced preliminary net income available to common shareholders for the first quarter of fiscal 2016 of $3.6 million, an increase of $336,000, or 10.3%, as compared to the same period of the prior fiscal year. The increase was attributable to increases in net interest income, noninterest income, and a decrease in provision for loan losses, partially offset by an increase in noninterest expense and provision for income tax. Preliminary net income available to common shareholders was $.48 per fully diluted common share for the first quarter of fiscal 2016, an increase of $0.04, or 9.1%, as compared to the same period of the prior fiscal year, adjusted for the two-for-one common stock split in the form of a 100% common stock dividend paid in January 2015.

Highlights for the first quarter of fiscal 2016:

  • Earnings per common share (diluted) were up $.04, or 9.1%, as compared to $.44 earned in the same quarter a year ago (adjusted for the January 2015 stock split), and up $.01, or 2.1%, as compared to the $.47 earned in the fourth quarter of fiscal 2015, the linked quarter.
     
  • Annualized return on average assets was 1.12%, while annualized return on average common equity was 12.6%, as compared to 1.09% and 13.2%, respectively, in the same quarter a year ago, and as compared to a 1.11% and 12.5%, respectively, in the fourth quarter of fiscal 2015, the linked quarter.
     
  • Net loan growth for the first three months of fiscal 2016 was $15.9 million, or 1.5%. Deposits were up $2.5 million, or 0.5%.
     
  • Net interest margin for the first quarter of fiscal 2016 was 3.87%, down from the 3.93% reported for the year ago period, and up from the net interest margin of 3.85% for the fourth quarter of fiscal 2015, the linked quarter.
     
  • Noninterest income was up 11.2% for the first quarter of fiscal 2016, compared to the year ago period, and down 8.2% from the fourth quarter of fiscal 2015, the linked quarter (none of the periods included securities gains or losses).
     
  • Noninterest expense was up 5.1% for the first quarter of fiscal 2016, compared to the year ago period, and down 0.2% from the fourth quarter of fiscal 2015, the linked quarter. The year-ago period included $128,000 in noninterest expense related to merger and acquisition activity, with no comparable expenses in the current quarter, or in the linked quarter.
     
  • Non-performing assets were $8.6 million, or 0.65% of total assets, at September 30, 2015, as compared to $8.3 million, or 0.64% of total assets, at June 30, 2015.

Dividend Declared:

The Company is pleased to announce that the Board of Directors, on October 20, 2015, declared its 86th consecutive quarterly dividend on common stock since the inception of the Company. The cash dividend of $.09 per common share will be paid November 30, 2015, to common stockholders of record at the close of business on November 13, 2015. The Board of Directors and management believe the payment of a quarterly cash dividend enhances shareholder value and demonstrates our commitment to and confidence in our future prospects.

Repurchase of Small Business Lending Fund Preferred Stock Completed:

The Company noted in a Current Report on Form 8-k filed October 16, 2015, that it redeemed all 20,000 shares of the Company’s Senior Preferred Non-Cumulative Perpetual Preferred Stock, Series A (the “Preferred Stock”), which were issued to the U.S. Department of the Treasury in July 2011 pursuant to Treasury’s Small Business Lending Fund (SBLF) program. The shares of Preferred Stock were redeemed at their liquidation amount of $1,000 per share plus accrued but unpaid dividends to the redemption date.

Conference Call:

The Company will host a conference call to review the information provided in this press release on Tuesday, October 27, 2014, at 3:30 p.m. central time (4:30 p.m. eastern). The call will be available live to interested parties by calling 1-888-339-0709 in the United States (Canada: 1-855-669-9657, international: 1-412-902-4189). Telephone playback will be available beginning one hour following the conclusion of the call through November 9, 2015. The playback may be accessed by dialing 1-877-344-7529 (Canada: 1-855-669-9658, international: 1-412-317-0088), and using the conference passcode 10075043. Participants should ask to be joined into the Southern Missouri Bancorp (SMBC) call.

Balance Sheet Summary:

The Company experienced balance sheet growth in the first three months of fiscal 2016, with total assets of $1.3 billion at September 30, 2015, reflecting an increase of $19.7 million, or 1.5%, as compared to June 30, 2015. Balance sheet growth was funded primarily with Federal Home Loan Bank (FHLB) overnight borrowings and deposit growth.

Available-for-sale (AFS) securities were $127.5 million at September 30, 2015, a decrease of $2.1 million, or 1.6%, as compared to June 30, 2015. The decrease was attributable to principal payments received on mortgage-backed securities and U.S. government agency obligations, partially offset by purchases of municipal securities. Cash equivalents and time deposits were $20.2 million, an increase of $1.5 million, or 8.2%, as compared to June 30, 2015.

Loans, net of the allowance for loan losses, were $1.1 billion at September 30, 2015, an increase of $15.9 million, or 1.5%, as compared to June 30, 2015. The increase was primarily attributable to increased balances for commercial and agricultural operating and equipment loans, residential real estate loans (primarily, multifamily real estate), and commercial real estate loans, partially offset by declines in drawn construction loan balances and consumer loan balances.

Non-performing loans were $4.1 million, or 0.38% of gross loans, at September 30, 2015, as compared to $3.8 million, or 0.36% of gross loans, at June 30, 2015. Non-performing assets were $8.6 million, or 0.65% of total assets, at September 30, 2015, as compared to $8.3 million, or 0.64% of total assets, at June 30, 2015. Our allowance for loan losses at September 30, 2015, totaled $12.8 million, representing 1.18% of gross loans and 315% of non-performing loans, as compared to $12.3 million, or 1.15% of gross loans, and 323% of non-performing loans, at June 30, 2015. For all impaired loans, the Company has measured impairment under ASC 310-10-35, and management believes the allowance for loan losses at September 30, 2015, is adequate, based on that measurement.

Total liabilities were $1.2 billion at September 30, 2015, an increase of $16.5 million, or 1.4%, as compared to June 30, 2015.

Deposits were $1.1 billion at September 30, 2015, an increase of $2.5 million, or 0.2%, as compared to June 30, 2015. The increase was primarily attributable to increased interest-bearing and noninterest-bearing transaction account balances, partially offset by decreases in savings account and certificate of deposit balances. The average loan-to-deposit ratio for the first quarter of fiscal 2016 was 101.8%, unchanged from the same period of the prior fiscal year.

FHLB advances were $82.1 million at September 30, 2015, an increase of $17.3 million, or 26.7%, as compared to June 30, 2015. The increase was attributable to overnight borrowings utilized to fund asset growth. Securities sold under agreements to repurchase totaled $24.4 million at September 30, 2015, a decrease of $2.9 million, or 10.6%, as compared to June 30, 2015. At both dates, the full balance of repurchase agreements was due to local small business and government counterparties.

The Company’s stockholders’ equity was $135.9 million at September 30, 2015, an increase of $3.2 million, or 2.4%, as compared to June 30, 2015. The increase was attributable primarily to the retention of net income and an increase in accumulated other comprehensive income, partially offset by dividends paid on common and preferred stock.

Income Statement Summary:

On August 5, 2014, the Company closed on the acquisition of Peoples Service Company and its subsidiaries, Peoples Banking Company and Peoples Bank of the Ozarks (the “Peoples Acquisition”). Beginning in the first quarter of fiscal 2015, the Peoples Acquisition impacted our reported results through a larger average balance sheet, and increased noninterest income and noninterest expense.

The Company’s net interest income for the three-month period ended September 30, 2015, was $11.7 million, an increase of $575,000, or 5.2%, as compared to the same period of the prior fiscal year. The increase was attributable to a 6.7% increase in the average balance of interest-earning assets, partially offset by a decrease in net interest margin, from 3.93% in the three-month period ended September 30, 2014, to 3.87% in the current three-month period.

Accretion of fair value discount on loans and amortization of fair value premiums on time deposits related to the Peoples Acquisition increased to $412,000 for the three-month period ended September 30, 2015, as compared to $390,000 in the same period of the prior fiscal year. This component of net interest income contributed 14 basis points to net interest margin in the three-month period ended September 30, 2015, equal to the impact in the same period of the prior fiscal year. The dollar impact from the Peoples Acquisition increased in comparison to the year-ago period primarily as a result of the Company’s ownership of the underlying assets for a full quarter, while the impact on net interest margin was stable because average interest earning assets increased by a similar percentage. The trend generally has been for the impact to decline each sequential quarter as a result of acquired assets maturing or prepaying.

The provision for loan losses for the three-month period ended September 30, 2015, was $618,000, as compared to $827,000 in the same period of the prior fiscal year. As a percentage of average loans outstanding, provision for loan losses in the current three-month period represented a charge of .23% (annualized), while the Company recorded net charge offs during the period of .04% (annualized). During the same period of the prior fiscal year, provision for loan losses as a percentage of average loans outstanding represented a charge of .35% (annualized), while the Company recorded a net recovery of .01% (annualized).

The Company’s noninterest income for the three-month period ended September 30, 2015, was $2.2 million, an increase of $222,000, or 11.2%, as compared to the same period of the prior fiscal year. The increase was attributed to increases in bank card interchange income, deposit account service charges, and loan fees, partially offset by a decrease in gains realized on secondary market loan originations.

Noninterest expense for the three-month period ended September 30, 2015, was $8.0 million, an increase of $386,000, or 5.1%, as compared to the same period of the prior fiscal year. The increase was attributed primarily to compensation and benefits and occupancy expenses, partially offset by a decline in legal and professional fees, including losses on debit card fraud and charges related to foreclosed real estate. Included in noninterest expense for the three-month period ended September 30, 2014, was $128,000 in merger-related charges, with no comparable expenses in the current period. The efficiency ratio for the three-month period ended September 30, 2015, was 57.4%, as compared to 58.0% for the same period of the prior fiscal year. The improvement resulted from a combined 5.7% increase in net interest income and noninterest income, while noninterest expense increased 5.1%.

The income tax provision for the three-month period ended September 30, 2015, was $1.7 million, an increase of $284,000, or 20.6%, as compared to the same period of the prior fiscal year, attributable to higher pre-tax income, as well as an increase in the effective tax rate, from 29.5% to 31.4%. The general trend in the effective tax rate has been upward, as the Company’s taxable income has grown at a rate faster than its investments in tax advantaged assets.

Forward-Looking Information:

Except for the historical information contained herein, the matters discussed in this press release may be deemed to be forward-looking statements that are subject to known and unknown risks, uncertainties, and other factors that could cause the actual results to differ materially from the forward-looking statements, including: the strength of the United States economy in general and the strength of the local economies in which we conduct operations; fluctuations in interest rates and in real estate values; monetary and fiscal policies of the Board of Governors of the Federal Reserve System and the U.S. Government and other governmental initiatives affecting the financial services industry; the risks of lending and investing activities, including changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses; our ability to access cost-effective funding; the timely development of and acceptance of our new products and services and the perceived overall value of these products and services by users, including the features, pricing and quality compared to competitors’ products and services; expected cost savings, synergies and other benefits from the Company’s merger and acquisition activities might not be realized to the extent anticipated or within the anticipated time frames, if at all, and costs or difficulties relating to integration matters, including but not limited to customer and employee retention, might be greater than expected; fluctuations in real estate values and both residential and commercial real estate market conditions; demand for loans and deposits in our market area; legislative or regulatory changes that adversely affect our business; results of examinations of us by our regulators, including the possibility that our regulators may, among other things, require us to increase our reserve for loan losses or to write-down assets; the impact of technological changes; and our success at managing the risks involved in the foregoing. Any forward-looking statements are based upon management’s beliefs and assumptions at the time they are made. We undertake no obligation to publicly update or revise any forward-looking statements or to update the reasons why actual results could differ from those contained in such statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking statements discussed might not occur, and you should not put undue reliance on any forward-looking statements.

Southern Missouri Bancorp, Inc.

UNAUDITED CONDENSED CONSOLIDATED FINANCIAL INFORMATION
           
Summary Balance Sheet Data as of:  September 30,  June 30,  March 31,  December 31,  September 30,
  (dollars in thousands, except per share data)    2015      2015      2015      2014      2014  
           
Cash equivalents and time deposits $   20,250   $   18,719   $   23,496   $   40,018   $   28,139  
AFS securities     127,485       129,593       133,637       146,030       156,785  
FHLB/FRB membership stock     7,162       6,467       6,475       5,384       7,212  
Loans receivable, gross     1,081,899       1,065,443       1,061,267       1,025,447       1,029,644  
  Allowance for loan losses     12,812       12,297        11,743       10,958       10,109  
Loans receivable, net     1,069,087       1,053,146       1,049,524       1,014,489       1,019,535  
Bank-owned life insurance     19,836        19,692       19,549       19,409       19,266  
Intangible assets     8,470       8,757       9,007       9,289       9,595  
Premises and equipment     42,788       39,726       37,490       35,982       34,415  
Other assets     24,715       23,964       23,680       25,650        20,956  
  Total assets $   1,319,793   $   1,300,064   $   1,302,858   $   1,296,251   $   1,295,903  
           
Interest-bearing deposits $   935,375   $   937,771   $   935,347   $    937,273   $   905,980  
Noninterest-bearing deposits     122,341       117,471       121,647       125,603       115,682  
Securities sold under agreements to repurchase     24,429       27,332       27,960       21,385       24,113  
FHLB advances     82,110       64,794       65,080       62,966       108,751  
Other liabilities     4,981       5,395       5,232       4,472       522  
Subordinated debt     14,682       14,658       14,635       14,617       14,594  
  Total liabilities     1,183,918       1,167,421       1,169,901       1,166,316       1,169,642  
           
Preferred stock     20,000       20,000       20,000       20,000       20,000  
Common stockholders’ equity     115,875       112,643       112,957       109,935       106,261  
  Total stockholders’ equity     135,875       132,643       132,957       129,935       126,261  
           
  Total liabilities and stockholders’ equity $   1,319,793   $   1,300,064   $   1,302,858   $   1,296,251   $   1,295,903  
           
Equity to assets ratio   10.30 %   10.20 %   10.21 %   10.02 %   9.74 %
Common shares outstanding     7,424,666       7,419,666       7,413,666       7,411,666       7,382,666  
  Less: Restricted common shares not vested     54,800       55,600       73,200       71,200       72,000  
Common shares for book value determination     7,369,866       7,364,066       7,340,466       7,340,466       7,310,666  
           
Book value per common share $   15.72   $   15.30   $   15.39   $   14.98   $   14.54  
Closing market price     20.72        18.85       18.87       18.99       17.94  
           
Nonperforming asset data as of:  September 30,  June 30,  March 31,  December 31,  September 30,
  (dollars in thousands)    2015      2015      2015      2014      2014  
           
Nonaccrual loans $   4,021   $   3,758   $   4,200   $   4,665   $   2,925  
Accruing loans 90 days or more past due     50        45       137       15       24  
Nonperforming troubled debt restructurings (1)     –        –        –         –        –   
  Total nonperforming loans     4,071       3,803       4,337       4,680       2,949  
Other real estate owned (OREO)     4,392       4,440       4,291       4,099       3,804  
Personal property repossessed     109       64       36       29       9  
Nonperforming investment securities     –        –        –        –        –   
  Total nonperforming assets $    8,572   $   8,307   $   8,664   $   8,808   $   6,762  
           
Total nonperforming assets to total assets   0.65 %   0.64 %   0.66 %   0.68 %   0.52 %
Total nonperforming loans to gross loans   0.38 %   0.36 %   0.41 %   0.46 %   0.29 %
Allowance for loan losses to
  nonperforming loans
  314.71 %   323.35 %   270.76 %   234.15 %   342.79 %
Allowance for loan losses to gross loans   1.18 %   1.15 %   1.11 %   1.07 %   0.98 %
           
Performing troubled debt restructurings $    6,949   $   6,548   $   3,620   $   3,503   $   5,050  
           
  (1) reported here only if not otherwise listed as nonperforming (i.e., nonaccrual or 90+ days past due)    

   For the three-month period ended
Quarterly Average Balance Sheet Data:  September 30,  June 30,  March 31,  December 31,  September 30,
  (dollars in thousands)    2015      2015      2015      2014      2014  
           
Interest-bearing cash equivalents $    9,488   $   12,398   $   16,148   $   20,542   $   27,326  
AFS securities and membership stock     135,706       136,063       147,433       155,506        156,172  
Loans receivable, gross     1,063,851       1,050,087       1,040,371       1,030,821       950,060  
  Total interest-earning assets     1,209,045       1,198,548       1,203,952        1,206,869       1,133,558  
Other assets     91,437       91,493       92,966       90,682       76,860  
  Total assets $   1,300,482   $   1,290,041   $   1,296,918   $   1,297,551   $   1,210,418  
           
Interest-bearing deposits $   925,089   $   933,444   $   943,035   $   920,566   $   833,477  
Securities sold under agreements to repurchase      25,885       27,442       26,256       23,475       24,599  
FHLB advances     68,843       56,377       57,596       88,642       119,043  
Subordinated debt     14,670       14,647       14,626       14,606       12,569  
  Total interest-bearing liabilities     1,034,487       1,031,910       1,041,513       1,047,289       989,688  
Noninterest-bearing deposits     120,283       124,436       123,033       121,280       99,879  
Other noninterest-bearing liabilities     11,473        802       754       658       2,087  
  Total liabilities     1,166,243       1,157,148       1,165,300       1,169,227       1,091,654  
           
Preferred stock     20,000       20,000       20,000       20,000       20,000  
Common stockholders’ equity     114,239       112,893       111,618       108,324       98,764  
  Total stockholders’ equity     134,239       132,893       131,618       128,324       118,764  
           
  Total liabilities and stockholders’ equity $   1,300,482   $   1,290,041   $   1,296,918   $   1,297,551   $   1,210,418  
           
   For the three-month period ended
Quarterly Summary Income Statement Data:  September 30,  June 30,  March 31,  December 31,  September 30,
  (dollars in thousands, except per share data)    2015      2015      2015      2014      2014  
           
Interest income:          
  Cash equivalents $   7   $   18   $   16   $   49   $   34  
  AFS securities and membership stock     865       843       918       948       959  
  Loans receivable     13,098        12,955       12,975       13,361       12,225  
  Total interest income     13,970       13,816       13,909       14,358       13,218  
Interest expense:          
  Deposits     1,785       1,800       1,756       1,703       1,601  
  Securities sold under agreements to repurchase     29        32       30       27       28  
  FHLB advances     317       304       301       333        339  
  Subordinated debt     135       134       125       133       121  
  Total interest expense     2,266       2,270        2,212       2,196       2,089  
Net interest income     11,704       11,546       11,697       12,162       11,129  
Provision for loan losses      618       659       837       862       827  
Securities gains     –        –        3        3       –   
Other noninterest income     2,202       2,398       2,091       2,184       1,980  
Noninterest expense     7,988        8,002       8,091       8,590       7,602  
Income taxes     1,665       1,718       1,497       1,460       1,381  
Net income      3,635       3,565       3,366       3,437       3,299  
  Less: effective dividend on preferred shares     50       50       50       50       50  
  Net income available to common shareholders $   3,585   $   3,515   $   3,316   $   3,387   $   3,249  
           
Basic earnings per common share (2) $   0.48   $   0.47   $   0.45   $   0.46   $   0.46  
Diluted earnings per common share (2)     0.48       0.47       0.44       0.45       0.44  
Dividends per common share (2)     0.090       0.085       0.085       0.085       0.085  
Average common shares outstanding (2):          
  Basic     7,422,000       7,418,000       7,413,000       7,404,000       7,114,000  
  Diluted     7,454,000       7,524,000       7,604,000       7,593,000       7,308,000  
           
Return on average assets   1.12 %   1.11 %   1.04 %   1.06 %   1.09 %
Return on average common shareholders’ equity   12.6 %   12.5 %   11.9 %   12.5 %   13.2 %
           
Net interest margin   3.87 %   3.85 %   3.89 %   4.03 %   3.93 %
Net interest spread   3.74 %   3.73 %   3.77 %   3.92 %   3.82 %
           
Efficiency ratio   57.4 %   57.4 %   58.7 %   59.9 %   58.0 %
           
  (2) adjusted to reflect the 2-for-1 stock split in the form of a 100% stock dividend paid January 30, 2015