IF Bancorp, Inc. Announces Results for Second Quarter of Fiscal Year 2024
- Unaudited net income of $185,000 for Q4 2023
- Interest income increased to $10.2 million for Q4 2023 from $8.1 million for Q4 2022
- Stockholders' equity increased to $73.7 million at December 31, 2023, from $71.8 million at June 30, 2023
- Net interest income decreased to $4.4 million from $6.0 million
- Deposits decreased to $678.0 million from $735.3 million due to a large withdrawal of tax monies
Insights
The reported financial results of IF Bancorp, Inc. reflect a significant decrease in net income for both the three-month and six-month periods ending December 31, 2023, compared to the same periods in the previous year. This decline is a critical indicator of the company's current financial health and will likely influence investor sentiment. The increase in interest expense, which more than doubled, suggests a rising cost of capital that could potentially squeeze margins if not managed effectively. However, the increase in net loans receivable indicates potential growth in the company's core lending business, which could be a positive sign for future revenue streams.
It is also notable that the provision for credit losses has increased substantially, which could imply that the company is anticipating higher loan defaults. This is a crucial point of concern as it might signal a more cautious outlook on asset quality. The decrease in deposits, particularly due to the withdrawal of tax monies from a public entity, may affect the company’s liquidity position and could necessitate increased borrowings, as evidenced by the rise in total borrowings including repurchase agreements. This dynamic warrants close monitoring as it could impact the company's financial flexibility and cost of funds.
From a market perspective, the performance of IF Bancorp, Inc. should be contextualized within the broader economic environment and the banking sector. The rising interest rates environment could explain both the increased interest income and the increased interest expenses. Banks typically benefit from a widening interest rate spread, but the data suggests that IF Bancorp's interest expenses are growing at a faster rate than interest income, compressing net interest income.
The decrease in non-interest income and the modest reduction in non-interest expenses may reflect efforts to streamline operations, but they also highlight the challenges of generating alternative revenue streams. The banking industry is highly competitive and IF Bancorp's ability to adapt to changing market conditions, while maintaining a strong balance sheet, will be critical for its long-term success. The changes in the company's asset composition, such as the decrease in cash and cash equivalents and investment securities, alongside an increase in net loans receivable, suggest a strategic shift that could have implications for risk management and the company's ability to respond to economic shifts.
An economist might highlight the macroeconomic factors influencing IF Bancorp's financial results, such as interest rate trends, inflationary pressures and economic growth prospects. The reported figures indicate that IF Bancorp is experiencing the effects of a changing economic landscape, which could have contributed to the increased provision for credit losses. This is an indicator that the company is preparing for potential economic headwinds that could affect borrowers' ability to repay loans.
The decrease in deposits and the significant increase in borrowings reflect a shift in the company's capital structure that could be a response to the current interest rate environment. An increase in stockholders' equity, primarily due to comprehensive income and stock activity, provides a cushion against potential losses, but the overall financial performance suggests that the company may face challenges in maintaining profitability if the economic conditions deteriorate or if interest rates continue to rise.
For the three months ended December 31, 2023, net interest income was
The Company announced unaudited net income of
Total assets at December 31, 2023 were
IF Bancorp, Inc. is the savings and loan holding company for Iroquois Federal Savings and Loan Association. The Association, originally chartered in 1883 and headquartered in
This press release may contain statements relating to the future results of the Company (including certain projections and business trends) that are considered "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 (the “PSLRA”). Such forward-looking statements may be identified by the use of such words as "believe," "expect," "anticipate," "should," "planned," "estimated," "intend" and "potential." For these statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the PSLRA.
The Company cautions you that a number of important factors could cause actual results to differ materially from those currently anticipated in any forward-looking statement. Such factors include, but are not limited to: prevailing economic and geopolitical conditions, including as a result of the COVID-19 pandemic; changes in interest rates, loan demand, real estate values and competition; changes in accounting principles, policies, and guidelines; changes in any applicable law, rule, regulation or practice with respect to tax or legal issues; and other economic, competitive, governmental, regulatory and technological factors affecting the Company's operations, pricing, products and services and other factors that may be described in the Company’s annual report on Form 10-K and quarterly reports on Form 10-Q as filed with the Securities and Exchange Commission. The forward-looking statements are made as of the date of this release, and, except as may be required by applicable law or regulation, the Company assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.
Selected Income Statement Data |
||||||||||||
(Dollars in thousands, except per share data) |
||||||||||||
|
For the Three Months Ended
|
For the Six Months Ended
|
|
|||||||||
|
2023 |
2022 |
2023 |
2022 |
|
|||||||
|
(unaudited) |
|
||||||||||
Interest and dividend income |
$ |
10,229 |
$ |
8,106 |
$ |
19,520 |
$ |
15,184 |
|
|||
Interest expense |
|
5,841 |
|
2,061 |
|
10,549 |
|
2,889 |
|
|||
Net interest income |
|
4,388 |
|
6,045 |
|
8,971 |
|
12,295 |
|
|||
Provision for credit losses |
|
364 |
|
101 |
|
586 |
|
13 |
|
|||
Net interest income after provision for credit losses |
|
4,024 |
|
5,944 |
|
8,385 |
|
12,282 |
|
|||
Noninterest income |
|
915 |
|
868 |
|
2,043 |
|
2,086 |
|
|||
Noninterest expense |
|
4,707 |
|
4,922 |
|
9,555 |
|
9,769 |
|
|||
Income before taxes |
|
232 |
|
1,890 |
|
873 |
|
4,599 |
|
|||
Income tax expense |
|
47 |
|
486 |
|
222 |
|
1,226 |
|
|||
|
|
|
|
|
|
|||||||
Net income |
$ |
185 |
$ |
1,404 |
$ |
651 |
$ |
3,373 |
|
|||
|
|
|
|
|
|
|||||||
Earnings per share (1) Basic |
$ |
0.06 |
$ |
0.44 |
$ |
0.20 |
$ |
1.07 |
|
|||
Diluted |
$ |
0.06 |
$ |
0.43 |
$ |
0.20 |
$ |
1.05 |
|
|||
Weighted average shares outstanding (1) |
|
|
|
|
|
|||||||
Basic |
|
3,207,883 |
|
3,171,638 |
|
3,205,477 |
|
3,138,188 |
|
|||
Diluted |
|
3,207,883 |
|
3,244,962 |
|
3,205,477 |
|
3,212,964 |
|
|||
Performance Ratios |
||||||
|
For the Six Months Ended
|
For the Year Ended
|
||||
|
(unaudited) |
|
||||
Return on average assets |
0.15 |
% |
0.56 |
% |
||
Return on average equity |
1.88 |
% |
6.56 |
% |
||
Net interest margin on average interest earning assets |
2.16 |
% |
2.80 |
% |
||
Selected Balance Sheet Data |
||||||
(Dollars in thousands, except per share data) |
||||||
|
At
|
At
|
||||
|
(unaudited) |
|
||||
Assets |
$ |
910,783 |
|
$ |
848,976 |
|
Cash and cash equivalents |
|
8,169 |
|
|
10,988 |
|
Investment securities |
|
199,930 |
|
|
201,299 |
|
Net loans receivable |
|
653,549 |
|
|
587,457 |
|
Deposits |
|
678,045 |
|
|
735,314 |
|
Federal Home Loan Bank borrowings, repurchase agreements and other borrowings |
|
148,465 |
|
|
30,287 |
|
Total stockholders’ equity |
|
73,741 |
|
|
71,753 |
|
Book value per share (2) |
|
21.98 |
|
|
21.39 |
|
Average stockholders’ equity to average total assets |
|
7.98 |
% |
|
8.59 |
% |
Asset Quality |
||||||
(Dollars in thousands) |
||||||
|
At
|
At
|
||||
|
(unaudited) |
|||||
Non-performing assets (3) |
$ |
36 |
|
$ |
148 |
|
Allowance for credit losses |
|
7,935 |
|
|
7,139 |
|
Non-performing assets to total assets |
|
0.01 |
% |
|
0.02 |
% |
Allowance for credit losses to total loans |
|
1.20 |
% |
|
1.20 |
% |
(1) |
Shares outstanding do not include ESOP shares not committed for release. |
(2) |
Total stockholders’ equity divided by shares outstanding of 3,354,626 at December 31, 2023 and June 30, 2023. |
(3) |
Non-performing assets include non-accrual loans, loans past due 90 days or more and accruing, and foreclosed assets held for sale. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240130723198/en/
Walter H. Hasselbring, III
(815) 432-2476
Source: IF Bancorp, Inc.
FAQ
What is the unaudited net income for Q4 2023?
How did interest income change for Q4 2023 compared to Q4 2022?
What happened to deposits from June 30, 2023, to December 31, 2023?
What is the stockholders' equity at December 31, 2023?
