MW Bancorp, Inc. Reports Third Quarter Results

CINCINNATI, April 28, 2016 /PRNewswire/ -- MW Bancorp, Inc. (the "Company") (OTC: MWBC), the parent company of Watch Hill Bank (the "Bank"), today reported net income of $669,000, or $0.83 per share, for the quarter ended March 31, 2016.  Net income increased by $606,000, compared to the quarter ended March 31, 2015. 

The Company also reported net income of $739,000, or $0.92 per share, for the nine months ended March 31, 2016, which represented an increase of $597,000 over the nine months ended March 31, 2015. 

The increase in net income for the three months ended March 31, 2016, compared to the same quarter in 2015, was due primarily to recognition of a $680,000 tax benefit related to the partial reversal of the impairment valuation allowance on the Company's deferred tax assets, along with a $76,000 increase in net interest income and a $136,000 increase in non-interest income, which were partially offset by a $291,000 increase in non-interest expenses.  Interest income increased $137,000, or 15.9%, for the three months ended March 31, 2016, compared to the three months ended March 31, 2015, primarily due to a $128,000 increase in interest on loans receivable.  Total interest expense increased $61,000, or 24.7%, for the three months ended March 31, 2016, over the three months ended March 31, 2015, due primarily to an increase in interest expense on deposits of $52,000, or 30.1%.  Non-interest income increased $136,000, or 348.7%, for the three months ended March 31, 2016 over the three months ended March 31, 2015, primarily due to a $109,000 increase in gain on sale of loans.  Non-interest expense increased $291,000, or 49.5%, for the three months ended March 31, 2016 compared to the three months ended March 31, 2015, primarily due to an increase of $186,000, or 56.2%, in salaries, employee benefits and directors fees expense, as the Company increased staffing levels and bonus and incentive compensation. 

The increase in net income for the nine months ended March 31, 2016, compared to the same period in 2015, was due primarily to recognition of the $680,000 tax benefit related to the partial reversal of the impairment valuation allowance on the Company's deferred tax assets, along with a $282,000 increase in net interest income and a $153,000 increase in non-interest income, which were partially offset by a $540,000 increase in non-interest expenses.  Interest income increased $451,000, or 18.0%, for the nine months ended March 31, 2016 over the nine months ended March 31, 2015. This increase was primarily attributable to a $436,000 increase in interest on loans receivable.  Total interest expense increased $169,000, or 23.0%, for the nine months ended March 31, 2016, over the nine months ended March 31, 2015, due primarily to an increase in interest expense on deposits of $132,000, or 25.2%.  Non-interest income increased $153,000, or 106.3%, for the nine months ended March 31, 2016 over the nine months ended March 31, 2015, primarily due to a $134,000 increase in gain on sale of loans.  Non-interest expense increased $540,000, or 31.1%, for the nine months ended March 31, 2016 compared to the nine months ended March 31, 2015, due primarily to an increase of $280,000, or 27.4%, in salaries, employee benefits and directors fees expense, as the Company increased staffing levels and bonus and incentive compensation. 

The Company reported total assets of $119.2 million at March 31, 2016, an increase of $12.4 million, or 11.6% over June 30, 2015.  Total loans increased by 9.1% to $96.9 million, total deposits increased by 16.3% to $79.7 million and stockholders' equity increased by 5.0% to $16.5 million at March 31, 2016 compared to June 30, 2015. 

Total nonperforming loans were $988,000 at March 31, 2016, compared to $1.1 million at March 31, 2015. Classified loans totaled $1.7 million at March 31, 2016, compared to $1.9 million at March 31, 2015, and total loans past due greater than 30 days were $13,000 and $88,000 at those respective dates.  The Company had net recoveries totaling $18,000 for the nine months ended March 31, 2016, compared to net recoveries of $27,000 for the nine months ended March 31, 2015.  As a percentage of nonperforming loans, the allowance for loan losses was 165.3% at March 31, 2016, compared to 143.8% at March 31, 2015. 

The Company was formed in 2014 to serve as the stock holding company for the Bank following its mutual-to-stock conversion.  The conversion was completed effective January 29, 2015, whereby the Company issued 876,163 shares at an offering price of $10.00 per share.  Proceeds of the offering, net of offering costs and shares acquired by the ESOP, totaled $6.7 million. 

Information contained in this press release may be considered forward-looking in nature as defined by the Private Securities Litigation Reform Act of 1995 and is subject to various risks, uncertainties, and assumptions. Such forward-looking statements in this release are inherently subject to many uncertainties arising in MW Bancorp's operations and business environment. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or expected. Among the key factors that may have a direct bearing on MW Bancorp's operating results, performance or financial condition are competition, the demand for our products and services, our ability to maintain current deposit and loan levels at current interest rates, deteriorating credit quality, including changes in the interest rate environment reducing interest margins, changes in prepayment speeds, loan origination and sale volumes, charge-offs and loan loss provisions, our ability to maintain required capital levels and adequate sources of funding and liquidity, our ability to secure confidential information through the use of computer systems and telecommunications networks, and other factors as set forth in filings with the Securities and Exchange Commission, including the risk factors set forth in our Annual Report on Form 10-K for the year ended June 30, 2015. MW Bancorp undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in our expectations, except as required to be reported under the rules and regulations of the Securities and Exchange Commission. 

SOURCE MW Bancorp, Inc.