ý
|
Quarterly
Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of
1934. For the Quarterly Period Ended June 30,
2007
|
o
|
Transition
Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of
1934 For the Transition Period from
___________to__________
|
Ohio
|
34-1803915
|
(State
or other jurisdiction of
|
(I.R.S.
Employer
|
incorporation
or organization)
|
Identification
Number)
|
601
Clinton Street, Defiance, Ohio
|
43512
|
(Address
or principal executive office)
|
(Zip
Code)
|
Large
accelerated filer o
|
Accelerated
filer ý
|
Non-accelerated
filer o
|
June
30,
2007
|
December
31,
2006
|
|||||||
(In
Thousands)
|
||||||||
Assets
|
||||||||
Cash
and cash equivalents:
|
||||||||
Cash
and amounts due from
depository institutions
|
$ |
41,836
|
$ |
47,668
|
||||
Interest-bearing
deposits
|
635
|
2,355
|
||||||
42,471
|
50,023
|
|||||||
Securities:
|
||||||||
Available-for-sale,
carried at
fair value
|
113,184
|
110,682
|
||||||
Held-to-maturity,
carried at
amortized cost
|
||||||||
(fair
value $1,326 and $1,492 at
June 30, 2007
|
||||||||
and
December 31, 2006,
respectively)
|
1,288
|
1,441
|
||||||
114,472
|
112,123
|
|||||||
Loans
held for sale
|
7,083
|
3,426
|
||||||
Loans
receivable, net of allowance of $13,417 at June 30,
|
||||||||
2007
and $13,579 at December 31, 2006, respectively
|
1,231,610
|
1,226,310
|
||||||
Accrued
interest receivable
|
7,445
|
6,984
|
||||||
Federal
Home Loan Bank stock
|
18,586
|
18,586
|
||||||
Bank
owned life insurance
|
27,993
|
25,326
|
||||||
Premises
and equipment
|
36,212
|
34,899
|
||||||
Real
estate and other assets held for sale
|
3,324
|
2,392
|
||||||
Goodwill
|
36,551
|
35,090
|
||||||
Core
deposit and other intangibles
|
3,834
|
3,397
|
||||||
Mortgage
servicing rights
|
5,777
|
5,529
|
||||||
Other
assets
|
5,317
|
3,794
|
||||||
Total
assets
|
$ |
1,540,675
|
$ |
1,527,879
|
June
30,
2007
|
December
31,
2006
|
|||||||
(In
Thousands)
|
||||||||
Liabilities
and stockholders’ equity
|
||||||||
Liabilities:
|
||||||||
Deposits
|
$ |
1,167,198
|
$ |
1,138,445
|
||||
Advances
from the Federal Home
Loan Bank
|
128,685
|
162,228
|
||||||
Short
term borrowings and other
interest-bearing liabilities
|
27,572
|
30,424
|
||||||
Subordinated
debentures
|
36,083
|
20,619
|
||||||
Advance
payments by
borrowers
|
470
|
667
|
||||||
Deferred
taxes
|
990
|
1,295
|
||||||
Other
liabilities
|
15,020
|
14,376
|
||||||
Total
liabilities
|
1,376,018
|
1,368,054
|
||||||
Stockholders’
equity:
|
||||||||
Preferred
stock, no par value per
share:
|
||||||||
5,000
shares authorized; no
shares issued
|
-
|
-
|
||||||
Common
stock, $.01 par value per
share:
|
||||||||
20,000
shares authorized; 11,703
shares issued
|
||||||||
and
7,178 and 7,142 shares
outstanding, respectively
|
117
|
117
|
||||||
Additional
paid-in
capital
|
112,289
|
110,285
|
||||||
Stock
acquired by
ESOP
|
(309 | ) | (628 | ) | ||||
Accumulated
other comprehensive
loss, net of
|
||||||||
tax
of $(635) and $(362),
respectively
|
(1,182 | ) | (671 | ) | ||||
Retained
earnings
|
123,522
|
120,112
|
||||||
Treasury
stock, at cost, 4,525 and
4,561 shares
respectively
|
(69,780 | ) | (69,390 | ) | ||||
Total
stockholders’ equity
|
164,657
|
159,825
|
||||||
Total
liabilities and stockholders’ equity
|
$ |
1,540,675
|
$ |
1,527,879
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30
|
June
30
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Interest
Income
|
||||||||||||||||
Loans
|
$ |
22,601
|
$ |
21,217
|
$ |
44,900
|
$ |
41,264
|
||||||||
Investment
securities:
|
||||||||||||||||
Taxable
|
1,130
|
1,266
|
2,274
|
2,470
|
||||||||||||
Non-taxable
|
290
|
148
|
577
|
287
|
||||||||||||
Interest-bearing
deposits
|
210
|
67
|
221
|
138
|
||||||||||||
FHLB
stock
dividends
|
301
|
255
|
593
|
504
|
||||||||||||
Total
interest income
|
24,532
|
22,953
|
48,565
|
44,663
|
||||||||||||
Interest
Expense
|
||||||||||||||||
Deposits
|
10,054
|
7,872
|
19,594
|
14,695
|
||||||||||||
FHLB
advances and
other
|
1,614
|
2,374
|
3,617
|
4,521
|
||||||||||||
Subordinated
debentures
|
585
|
321
|
922
|
620
|
||||||||||||
Notes
payable
|
157
|
127
|
326
|
259
|
||||||||||||
Total
interest expense
|
12,410
|
10,694
|
24,459
|
20,095
|
||||||||||||
Net
interest income
|
12,122
|
12,259
|
24,106
|
24,568
|
||||||||||||
Provision
for loan losses
|
575
|
683
|
1,032
|
1,066
|
||||||||||||
Net
interest income after provision for loan losses
|
11,547
|
11,576
|
23,074
|
23,502
|
||||||||||||
Non-interest
Income
|
||||||||||||||||
Service
fees and other
charges
|
2,715
|
2,365
|
5,233
|
4,077
|
||||||||||||
Insurance
commission
income
|
1,361
|
1,002
|
3,064
|
2,662
|
||||||||||||
Mortgage
banking
income
|
1,076
|
888
|
1,858
|
1,622
|
||||||||||||
Gain
on sale of non-mortgage
loans
|
61
|
437
|
66
|
437
|
||||||||||||
Trust
income
|
99
|
78
|
185
|
157
|
||||||||||||
Income
from Bank Owned Life
Insurance
|
313
|
243
|
608
|
480
|
||||||||||||
Other
non-interest
income
|
45
|
114
|
263
|
207
|
||||||||||||
Total
non-interest income
|
5,670
|
5,127
|
11,277
|
9,642
|
||||||||||||
Non-interest
Expense
|
||||||||||||||||
Compensation
and
benefits
|
6,634
|
5,934
|
13,186
|
12,040
|
||||||||||||
Occupancy
|
1,405
|
1,287
|
2,808
|
2,515
|
||||||||||||
State
franchise
tax
|
355
|
337
|
718
|
664
|
||||||||||||
Data
processing
|
944
|
943
|
1,897
|
1,857
|
||||||||||||
Amortization
of
intangibles
|
170
|
180
|
313
|
359
|
||||||||||||
Other
non-interest
expense
|
2,374
|
2,114
|
4,731
|
4,102
|
||||||||||||
Total
non-interest expense
|
11,882
|
10,795
|
23,653
|
21,537
|
||||||||||||
Income
before income taxes
|
5,335
|
5,908
|
10,698
|
11,607
|
||||||||||||
Federal
income taxes
|
1,724
|
1,955
|
3,481
|
3,803
|
||||||||||||
Net
Income
|
3,611
|
3,953
|
7,217
|
7,804
|
||||||||||||
Earnings
per share (Note 6)
|
||||||||||||||||
Basic
|
$ |
0.51
|
$ |
0.56
|
$ |
1.01
|
$ |
1.11
|
||||||||
Diluted
|
$ |
0.50
|
$ |
0.55
|
$ |
1.00
|
$ |
1.09
|
||||||||
Dividends
declared per share (Note 5)
|
$ |
0.25
|
$ |
0.24
|
$ |
0.50
|
$ |
0.48
|
||||||||
Average
shares outstanding (Note 6)
|
||||||||||||||||
Basic
|
7,129
|
7,029
|
7,115
|
7,013
|
||||||||||||
Diluted
|
7,229
|
7,162
|
7,220
|
7,168
|
See
accompanying notes
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30
|
June
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Balance
at beginning of period
|
$ |
164,540
|
$ |
154,045
|
$ |
159,825
|
$ |
151,216
|
||||||||
Adjustment
to initially apply FIN 48
|
-
|
-
|
(200 | ) |
-
|
|||||||||||
Balance
at beginning of period as adjusted
|
164,540
|
154,045
|
159,625
|
151,216
|
||||||||||||
Comprehensive
income:
|
||||||||||||||||
Net
income
|
3,611
|
3,953
|
7,217
|
7,804
|
||||||||||||
Other
comprehensive income
(loss)
|
(608 | ) | (456 | ) | (511 | ) | (1,007 | ) | ||||||||
Total
comprehensive income
|
3,003
|
3,497
|
6,706
|
6,797
|
||||||||||||
ESOP
shares released
|
342
|
327
|
1,043
|
1,002
|
||||||||||||
Stock
option expense
|
71
|
74
|
130
|
133
|
||||||||||||
Tax
benefit of employee plans
|
12
|
-
|
56
|
-
|
||||||||||||
Shares
issued under stock option plans
|
190
|
495
|
462
|
1,710
|
||||||||||||
Treasury
shares repurchased
|
(1,729 | ) | (2,446 | ) | (2,055 | ) | (3,172 | ) | ||||||||
Acquisition
of Huber, Harger, Welt and Smith
|
-
|
-
|
2,250
|
-
|
||||||||||||
Common
cash dividends declared (Note 5)
|
(1,772 | ) | (1,680 | ) | (3,560 | ) | (3,374 | ) | ||||||||
Balance
at end of period
|
$ |
164,657
|
$ |
154,312
|
$ |
164,657
|
$ |
154,312
|
Six
Months Ended
|
||||||||
June
30,
|
||||||||
2007
|
2006
|
|||||||
Operating
Activities
|
||||||||
Net
cash provided by operating activities
|
$ |
4,852
|
$ |
6,557
|
||||
Investing
Activities
|
||||||||
Proceeds
from maturities of held-to-maturity securities
|
152
|
112
|
||||||
Proceeds
from maturities of available-for-sale securities
|
10,603
|
6,139
|
||||||
Proceeds
from sale of real estate and other assets held for sale
|
2,040
|
1,308
|
||||||
Proceeds
from sale of property, plant and equipment
|
-
|
43
|
||||||
Net
cash received in acquisition of Huber, Harger, Welt and
Smith
|
159
|
-
|
||||||
Proceeds
from sale of non-mortgage loans
|
8,440
|
-
|
||||||
Purchases
of available-for-sale securities
|
(13,935 | ) | (12,328 | ) | ||||
Investment
in bank owned life insurance
|
(2,060 | ) |
-
|
|||||
Purchases
of office properties and equipment
|
(2,715 | ) | (2,891 | ) | ||||
Net
increase in loans receivable
|
(17,701 | ) | (58,935 | ) | ||||
Net
cash (used in) provided by investing activities
|
(15,017 | ) | (66,552 | ) | ||||
Financing
Activities
|
||||||||
Net
increase in deposits and advance payments by borrowers
|
28,624
|
41,206
|
||||||
Repayment
of Federal Home Loan Bank long-term advances
|
(434 | ) | (1,750 | ) | ||||
Net
(decrease) increase in Federal Home Loan Bank short-term
advances
|
(33,100 | ) |
15,500
|
|||||
Proceeds
from issuance of subordinated debentures
|
15,464
|
-
|
||||||
Decrease
in securities sold under repurchase agreements
|
(2,852 | ) | (5,278 | ) | ||||
Purchase
of common stock for treasury
|
(2,055 | ) | (3,172 | ) | ||||
Cash
dividends paid
|
(3,552 | ) | (3,355 | ) | ||||
Proceeds
from exercise of stock options
|
462
|
1,710
|
||||||
Excess
tax benefits from exercise of stock options
|
56
|
-
|
||||||
Net
cash provided by financing activities
|
2,613
|
44,861
|
||||||
(Decrease)
increase in cash and cash equivalents
|
(7,552 | ) | (15,134 | ) | ||||
Cash
and cash equivalents at beginning of period
|
50,023
|
49,256
|
||||||
Cash
and cash equivalents at end of period
|
$ |
42,471
|
$ |
34,122
|
||||
Supplemental
cash flow information:
|
||||||||
Interest
paid
|
$ |
24,134
|
$ |
19,887
|
||||
Income
taxes paid
|
$ |
3,252
|
$ |
2,601
|
||||
Transfers
from loans to other real estate owned and other
|
||||||||
assets
held for
sale
|
$ |
2,972
|
$ |
4,338
|
Six
months ended June 30
|
||||||||||||||||
2007
|
2006
|
|||||||||||||||
Options
Outstanding
|
Weighted
Average
Option
Prices
|
Options
Outstanding
|
Weighted
Average
Option
Prices
|
|||||||||||||
Options
outstanding, beginning of period
|
404,154
|
$ |
19.36
|
569,099
|
$ |
16.00
|
||||||||||
Forfeited
or cancelled
|
(1,850 | ) |
26.50
|
(9,300 | ) |
22.51
|
||||||||||
Exercised
|
(32,922 | ) |
14.04
|
(149,222 | ) |
11.46
|
||||||||||
Granted
|
54,250
|
27.41
|
47,250
|
26.47
|
||||||||||||
Options
outstanding, end of period
|
423,632
|
$ |
20.77
|
457,827
|
$ |
18.43
|
Six
Months Ended June 30
|
||||||||
2007
|
2006
|
|||||||
Proceeds
of options exercised
|
$ |
462,076
|
$ |
1,709,906
|
||||
Related
tax benefit recognized
|
55,414
|
191,897
|
||||||
Intrinsic
value of options exercised
|
475,048
|
2,275,611
|
Six
Months Ended June 30
|
||||||||
2007
|
2006
|
|||||||
Expected
average risk-free rate
|
4.86 | % | 5.18 | % | ||||
Expected
average life
|
6.63
years
|
6.50
years
|
||||||
Expected
volatility
|
21.80 | % | 22.40 | % | ||||
Expected
dividend yield
|
3.64 | % | 3.63 | % |
Three
months ended June 30,
|
Six
months ended June 30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Numerator
for basic and diluted
earnings
per share – Net income
|
$ |
3,611
|
$ |
3,953
|
$ |
7,217
|
$ |
7,804
|
||||||||
Denominator:
|
||||||||||||||||
Denominator
for basic
earnings
per
share – weighted average
shares
|
7,129
|
7,029
|
7,115
|
7,013
|
||||||||||||
Effect
of dilutive
securities:
|
||||||||||||||||
Employee
stock
options
|
100
|
133
|
105
|
155
|
||||||||||||
Denominator
for diluted earnings per
share
– adjusted weighted average
shares
and assumed conversions
|
7,229
|
7,162
|
7,220
|
7,168
|
||||||||||||
Basic
earnings per share from net income
|
$ |
0.51
|
$ |
0.56
|
$ |
1.01
|
$ |
1.11
|
||||||||
Diluted
earnings per share from
net
income
|
$ |
0.50
|
$ |
0.55
|
$ |
1.00
|
$ |
1.09
|
Amortized
Cost
|
Gross
Unrealized
Gains
|
Gross
Unrealized
Losses
|
Fair
Value
|
|||||||||||||
At
June 30, 2007
|
||||||||||||||||
Available-for-Sale
Securities:
|
||||||||||||||||
U.S.
Treasury securities and
obligations
of
U.S. Government
corporations and
agencies
|
$ |
34,068
|
$ |
48
|
$ | (170 | ) | $ |
33,946
|
|||||||
Mortgage-backed
securities
|
21,034
|
8
|
(487 | ) |
20,555
|
|||||||||||
REMICs
|
3,064
|
-
|
(40 | ) |
3,024
|
|||||||||||
Collateralized
mortgage
obligations
|
20,478
|
25
|
(425 | ) |
20,078
|
|||||||||||
Trust
preferred
stock
|
7,996
|
156
|
(129 | ) |
8,023
|
|||||||||||
Obligations
of state and political
subdivisions
|
27,474
|
174
|
(90 | ) |
27,558
|
|||||||||||
Totals
|
$ |
114,114
|
$ |
411
|
$ | (1,341 | ) | $ |
113,184
|
|||||||
Held-to-Maturity
Securities:
|
||||||||||||||||
FHLMC
certificates
|
$ |
219
|
$ |
6
|
$ |
-
|
$ |
225
|
||||||||
FNMA
certificates
|
534
|
3
|
(4 | ) |
533
|
|||||||||||
GNMA
certificates
|
175
|
1
|
-
|
176
|
||||||||||||
Obligations
of state and
political subdivisions
|
360
|
32
|
-
|
392
|
||||||||||||
Totals
|
$ |
1,288
|
$ |
42
|
$ | (4 | ) | $ |
1,326
|
At
December 31, 2006
|
||||||||||||||||
Available-for-Sale
Securities:
|
||||||||||||||||
U.S.
Treasury securities and
obligations
of
U.S. Government
corporations and
agencies
|
$ |
36,108
|
$ |
106
|
$ | (171 | ) | $ |
36,043
|
|||||||
Mortgage-backed
securities
|
18,595
|
23
|
(276 | ) |
18,342
|
|||||||||||
REMICs
|
3,071
|
-
|
(11 | ) |
3,060
|
|||||||||||
Collateralized
mortgage
obligations
|
20,099
|
52
|
(346 | ) |
19,805
|
|||||||||||
Trust
preferred
stock
|
8,116
|
82
|
(20 | ) |
8,178
|
|||||||||||
Obligations
of state and
political subdivisions
|
24,840
|
418
|
(4 | ) |
25,254
|
|||||||||||
Totals
|
$ |
110,829
|
$ |
681
|
$ | (828 | ) | $ |
110,682
|
|||||||
Held-to-Maturity
Securities:
|
||||||||||||||||
FHLMC
certificates
|
$ |
272
|
$ |
8
|
$ |
-
|
$ |
280
|
||||||||
FNMA
certificates
|
614
|
5
|
(4 | ) |
615
|
|||||||||||
GNMA
certificates
|
195
|
1
|
-
|
196
|
||||||||||||
Obligations
of state and
political
subdivisions
|
360
|
41
|
-
|
401
|
||||||||||||
Totals
|
$ |
1,441
|
$ |
55
|
$ | (4 | ) | $ |
1,492
|
Duration
of Unrealized Loss Position
|
||||||||||||||||||||||||
Less
than 12 Months
|
12
Month or Longer
|
Total
|
||||||||||||||||||||||
Gross
|
Gross
|
|||||||||||||||||||||||
Fair
|
Unrealized
|
Fair
|
Unrealized
|
Fair
|
Unrealized
|
|||||||||||||||||||
Value
|
Loss
|
Value
|
Loss
|
Value
|
Losses
|
|||||||||||||||||||
(In
Thousands)
|
||||||||||||||||||||||||
At
June 30, 2007
|
||||||||||||||||||||||||
Available-for-sale
securities:
|
||||||||||||||||||||||||
U.S.
treasury securities and obligations of U.S. government corporations
and
agencies
|
$ |
8,368
|
$ | (65 | ) | $ |
13,460
|
$ | (105 | ) | $ |
21,828
|
$ | (170 | ) | |||||||||
Mortgage-backed
securities
|
7,468
|
(100 | ) |
11,004
|
(387 | ) |
18,472
|
(487 | ) | |||||||||||||||
Collateralized
mortgage obligations
|
5,455
|
(75 | ) |
14,669
|
(390 | ) |
20,124
|
(465 | ) | |||||||||||||||
Trust
preferred stock
|
2,406
|
(74 | ) |
360
|
(55 | ) |
2,766
|
(129 | ) | |||||||||||||||
Obligations
of state and political subdivisions
|
8,809
|
(86 | ) |
171
|
(4 | ) |
8,980
|
(90 | ) | |||||||||||||||
Held
to maturity securities:
|
||||||||||||||||||||||||
Mortgage-backed
securities
|
160
|
(4 | ) |
148
|
-
|
308
|
(4 | ) | ||||||||||||||||
Total
temporarily
impaired
securities
|
$ |
32,666
|
$ | (404 | ) | $ |
39,812
|
$ | (941 | ) | $ |
72,478
|
$ | (1,345 | ) |
June
30,
2007
|
December
31,
2006
|
|||||||
Real
Estate:
|
||||||||
One-to-four
family
residential
|
$ |
234,819
|
$ |
250,808
|
||||
Construction
|
16,346
|
17,339
|
||||||
Non-residential
and
multi-family
|
583,046
|
579,860
|
||||||
834,211
|
848,007
|
|||||||
Other
Loans:
|
||||||||
Commercial
|
255,022
|
232,914
|
||||||
Consumer
finance
|
40,693
|
43,770
|
||||||
Home
equity and
improvement
|
123,936
|
122,789
|
||||||
419,651
|
399,473
|
|||||||
Total
real estate and other loans
|
1,253,862
|
1,247,480
|
||||||
Deduct:
|
||||||||
Loans
in process
|
7,761
|
6,409
|
||||||
Net
deferred loan origination
fees and costs
|
1,074
|
1,182
|
||||||
Allowance
for loan
loss
|
13,417
|
13,579
|
||||||
Totals
|
$ |
1,231,610
|
$ |
1,226,310
|
Three
Months ended
June
30,
|
Six
Months ended
June
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Balance
at beginning of period
|
$ |
13,752
|
$ |
13,848
|
$ |
13,579
|
$ |
13,673
|
||||||||
Provision
for loan losses
|
575
|
683
|
1,032
|
1,066
|
||||||||||||
Charge-offs:
|
||||||||||||||||
One-to-four
family residential
real estate
|
51
|
23
|
136
|
211
|
||||||||||||
Non-residential
and multi-family
real estate
|
936
|
173
|
1,082
|
230
|
||||||||||||
Commercial
|
11
|
13
|
92
|
30
|
||||||||||||
Home
equity and
improvement
|
-
|
21
|
-
|
53
|
||||||||||||
Consumer
finance
|
23
|
135
|
94
|
230
|
||||||||||||
Total
charge-offs
|
1,021
|
365
|
1,404
|
754
|
||||||||||||
Recoveries
|
111
|
73
|
210
|
254
|
||||||||||||
Net
charge-offs
|
910
|
292
|
1,194
|
500
|
||||||||||||
Ending
allowance
|
$ |
13,417
|
$ |
14,239
|
$ |
13,417
|
$ |
14,239
|
June
30,
2007
|
December
31,
2006
|
|||||||
(in
thousands)
|
||||||||
Non-accrual
loans
|
$ |
6,427
|
$ |
7,283
|
||||
Loans
over 90 days past due and still accruing
|
-
|
-
|
||||||
Total
non-performing loans
|
6,427
|
$ |
7,283
|
|||||
Real
estate owned (REO)
|
3,324
|
2,392
|
||||||
Total
non-performing assets
|
$ |
9,751
|
$ |
9,675
|
June
30,
2007
|
December
31,
2006
|
|||||||
Non-interest-bearing
checking accounts
|
$ |
107,111
|
$ |
106,328
|
||||
Interest-bearing
checking and money market accounts
|
314,923
|
306,003
|
||||||
Savings
accounts
|
97,004
|
74,491
|
||||||
Retail
certificates of deposit less than $100,000
|
504,301
|
493,594
|
||||||
Retail
certificates of deposit greater than $100,000
|
136,319
|
140,392
|
||||||
Brokered
or national certificates of deposit
|
7,540
|
17,637
|
||||||
$ |
1,167,198
|
$ |
1,138,445
|
June
30,
2007
|
December
31,
2006
|
|||||||
(in
thousands)
|
||||||||
FHLB
Advances:
|
||||||||
Overnight
borrowings
|
$ |
-
|
$ |
33,100
|
||||
Single
maturity fixed rate advances
|
10,000
|
10,000
|
||||||
Single
maturity LIBOR based advances
|
45,000
|
45,000
|
||||||
Putable
advances
|
45,000
|
45,000
|
||||||
Strike-rate
advances
|
27,000
|
27,000
|
||||||
Amortizable
mortgage advances
|
1,685
|
2,128
|
||||||
Total
|
$ |
128,685
|
$ |
162,228
|
||||
Junior
subordinated debentures owed to
unconsolidated
subsidiary trusts
|
$ |
36,083
|
$ |
20,619
|
||||
June
30,
2007
|
December
31,
2006
|
|||||||
First
Defiance Statutory Trust I due December 2035
|
$ |
20,619
|
$ |
20,619
|
||||
First
Defiance Statutory Trust II due June 2037
|
15,464
|
-
|
||||||
Total
junior subordinated debentures owned to unconsolidated subsidiary
Trusts
|
$ |
36,083
|
$ |
20,619
|
||||
June
30,
2007
|
December
31,
2006
|
|||||||
(In
Thousands)
|
||||||||
Loan
commitments
|
$ |
278,282
|
$ |
260,349
|
||||
Standby
Letters of Credit
|
16,397
|
16,869
|
||||||
Total
|
$ |
294,679
|
$ |
277,218
|
Three
Months Ended
June
30,
|
Six
Months Ended
June
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
(In
Thousands)
|
||||||||||||||||
Service
cost-benefits attributable
to
service during the
period
|
$ |
12
|
$ |
10
|
$ |
24
|
$ |
20
|
||||||||
Interest
cost on accumulated post-
retirement
benefit
obligation
|
31
|
27
|
63
|
54
|
||||||||||||
Net
amortization and deferral
|
11
|
8
|
22
|
16
|
||||||||||||
Net
periodic postretirement
benefit
cost
|
$ |
54
|
$ |
45
|
$ |
109
|
$ |
90
|
Three
Months Ended June 30,
|
||||||||||||||||||||||||
2007
|
2006
|
|||||||||||||||||||||||
Average
|
Yield/
|
Average
|
Yield/
|
|||||||||||||||||||||
Balance
|
Interest(1)
|
Rate(2)
|
Balance
|
Interest(1)
|
Rate(2)
|
|||||||||||||||||||
Interest-earning
assets:
|
||||||||||||||||||||||||
Loans
receivable
|
$ |
1,231,192
|
$ |
22,613
|
7.37 | % | $ |
1,209,263
|
$ |
21,223
|
7.04 | % | ||||||||||||
Securities
|
111,756
|
1,585
|
5.67
|
114,895
|
1,562
|
5.40
|
||||||||||||||||||
Interest-earning
deposits
|
14,497
|
210
|
5.81
|
4,677
|
67
|
5.75
|
||||||||||||||||||
FHLB
stock and other
|
18,585
|
301
|
6.50
|
17,795
|
255
|
5.75
|
||||||||||||||||||
Total
interest-earning assets
|
1,376,030
|
24,709
|
7.20
|
1,346,630
|
23,107
|
6.88
|
||||||||||||||||||
Non-interest-earning
assets
|
151,833
|
147,905
|
||||||||||||||||||||||
Total
assets
|
$ |
1,527,863
|
$ |
1,494,535
|
||||||||||||||||||||
Interest-bearing
liabilities:
|
||||||||||||||||||||||||
Deposits
|
$ |
1,056,187
|
$ |
10,054
|
3.82 | % | $ |
995,848
|
$ |
7,872
|
3.17 | % | ||||||||||||
FHLB
advances and other
|
128,823
|
1,614
|
5.03
|
196,280
|
2,374
|
4.85
|
||||||||||||||||||
Notes
payable
|
21,323
|
157
|
2.95
|
18,114
|
127
|
2.81
|
||||||||||||||||||
Subordinated
debentures
|
36,247
|
585
|
6.47
|
20,619
|
321
|
6.24
|
||||||||||||||||||
Total
interest-bearing liabilities
|
1,242,580
|
12,410
|
4.01
|
1,230,861
|
10,694
|
3.48
|
||||||||||||||||||
Non-interest
bearing deposits
|
101,606
|
-
|
94,483
|
-
|
||||||||||||||||||||
Total
including non-interest bearing
|
||||||||||||||||||||||||
demand
deposits
|
1,344,186
|
12,410
|
3.70
|
1,325,344
|
10,694
|
3.24
|
||||||||||||||||||
Other
non-interest-bearing liabilities
|
19,086
|
14,931
|
||||||||||||||||||||||
Total
liabilities
|
1,363,272
|
1,340,275
|
||||||||||||||||||||||
Stockholders'
equity
|
164,591
|
154,260
|
||||||||||||||||||||||
Total
liabilities and stock-
|
||||||||||||||||||||||||
holders'
equity
|
$ |
1,527,863
|
$ |
1,494,535
|
||||||||||||||||||||
Net
interest income; interest
|
||||||||||||||||||||||||
rate
spread
|
$ |
12,299
|
3.19 | % | $ |
12,413
|
3.40 | % | ||||||||||||||||
Net
interest margin (3)
|
3.58 | % | 3.69 | % | ||||||||||||||||||||
Average
interest-earning assets
|
||||||||||||||||||||||||
to
average interest-bearing
|
||||||||||||||||||||||||
liabilities
|
111 | % | 109 | % |
(1)
|
Interest
on certain tax-exempt loans and securities is not taxable for Federal
income tax purposes. In order to compare the tax-exempt yields on
these
assets to taxable yields, the interest earned on these assets is
adjusted
to a pre-tax equivalent amount based on the marginal corporate federal
income tax rate of 35%.
|
(2)
|
Annualized
|
(3)
|
Net
interest margin is net interest income divided by average interest-earning
assets.
|
Six
Months Ended June 30,
|
||||||||||||||||||||||||
2007
|
2006
|
|||||||||||||||||||||||
Average
|
Yield/
|
Average
|
Yield/
|
|||||||||||||||||||||
Balance
|
Interest(1)
|
Rate(2)
|
Balance
|
Interest(1)
|
Rate(2)
|
|||||||||||||||||||
Interest-earning
assets:
|
||||||||||||||||||||||||
Loans
receivable
|
$ |
1,228,716
|
$ |
44,922
|
7.37 | % | $ |
1,193,485
|
$ |
41,276
|
6.97 | % | ||||||||||||
Securities
|
112,377
|
3,180
|
5.70
|
114,509
|
3,044
|
5.33
|
||||||||||||||||||
Interest-earning
deposits
|
7,811
|
221
|
5.71
|
5,699
|
138
|
4.88
|
||||||||||||||||||
FHLB
stock and other
|
18,585
|
593
|
6.43
|
17,671
|
504
|
5.75
|
||||||||||||||||||
Total
interest-earning assets
|
1,367,489
|
48,916
|
7.21
|
1,331,364
|
44,962
|
6.81
|
||||||||||||||||||
Non-interest-earning
assets
|
151,530
|
145,482
|
||||||||||||||||||||||
Total
assets
|
$ |
1,519,019
|
$ |
1,476,846
|
||||||||||||||||||||
Interest-bearing
liabilities:
|
||||||||||||||||||||||||
Deposits
|
$ |
1,043,509
|
$ |
19,594
|
3.79 | % | $ |
984,749
|
$ |
14,695
|
3.01 | % | ||||||||||||
FHLB
advances and other
|
144,332
|
3,617
|
5.05
|
191,111
|
4,521
|
4.77
|
||||||||||||||||||
Notes
payable
|
21,912
|
326
|
3.00
|
18,961
|
259
|
2.75
|
||||||||||||||||||
Subordinated
debentures
|
28,573
|
922
|
6.51
|
20,619
|
620
|
6.06
|
||||||||||||||||||
Total
interest-bearing liabilities
|
1,238,326
|
24,459
|
3.98
|
1,215,440
|
20,095
|
3.34
|
||||||||||||||||||
Non-interest
bearing deposits
|
99,770
|
-
|
93,255
|
-
|
||||||||||||||||||||
Total
including non-interest bearing
|
||||||||||||||||||||||||
demand
deposits
|
1,338,096
|
24,459
|
3.69
|
1,308,695
|
20,095
|
3.10
|
||||||||||||||||||
Other
non-interest-bearing liabilities
|
18,063
|
14,720
|
||||||||||||||||||||||
Total
liabilities
|
1,356,159
|
1,323,415
|
||||||||||||||||||||||
Stockholders'
equity
|
162,860
|
153,431
|
||||||||||||||||||||||
Total
liabilities and stock-
|
||||||||||||||||||||||||
holders'
equity
|
$ |
1,519,019
|
$ |
1,476,846
|
||||||||||||||||||||
Net
interest income; interest
|
||||||||||||||||||||||||
rate
spread
|
$ |
24,457
|
3.23 | % | $ |
24,867
|
3.47 | % | ||||||||||||||||
Net
interest margin (3)
|
3.61 | % | 3.76 | % | ||||||||||||||||||||
Average
interest-earning assets
|
||||||||||||||||||||||||
to
average interest-bearing
|
||||||||||||||||||||||||
liabilities
|
110 | % | 110 | % |
June
30,
2007
|
December
31,
2006
|
|||||||
(in
thousands)
|
||||||||
Non-accrual
loans
|
$ |
6,427
|
$ |
7,283
|
||||
Loans
over 90 days past due and still accruing
|
-
|
-
|
||||||
Total
non-performing loans
|
6,427
|
$ |
7,283
|
|||||
Real
estate owned (REO)
|
3,324
|
2,392
|
||||||
Total
non-performing assets
|
$ |
9,751
|
$ |
9,675
|
||||
Allowance
for loans losses as a percentage
of
total loans
|
1.08 | % | 1.10 | % | ||||
Allowance
for loan losses as a percentage
of
non-performing assets
|
137.60 | % | 140.35 | % | ||||
Allowance
for loan losses as a percentage
of
non-performing loans
|
208.76 | % | 186.45 | % | ||||
Total
non-performing assets as a percentage
of
total assets
|
0.63 | % | 0.64 | % | ||||
Total
non-performing loans as a percentage
of
total loans
|
0.51 | % | 0.59 | % |
Core
Capital
|
Risk-Based
Capital
|
|||||||||||||||
Adequately
Capitalized
|
Well
Capitalized
|
Adequately
Capitalized
|
Well
Capitalized
|
|||||||||||||
Regulatory
capital
|
$ |
148,597
|
$ |
148,597
|
$ |
162,016
|
$ |
162,016
|
||||||||
Minimum
required regulatory capital
|
59,888
|
74,860
|
104,783
|
130,979
|
||||||||||||
Excess
regulatory capital
|
$ |
88,709
|
$ |
73,737
|
$ |
57,233
|
$ |
31,037
|
||||||||
Regulatory
capital as a percentage of assets (1)
|
9.9 | % | 9.9 | % | 12.4 | % | 12.4 | % | ||||||||
Minimum
capital required as a percentage of assets
|
4.0 | % | 5.0 | % | 8.0 | % | 10.0 | % | ||||||||
Excess
regulatory capital as a percentage of assets
|
5.9 | % | 4.9 | % | 4.4 | % | 2.4 | % |
(1)
|
Core
capital is computed as a percentage of adjusted total assets of $1.50
billion. Risk-based capital is computed as a percentage of total
risk-weighted assets of $1.31
billion.
|
|
First
Defiance is not engaged in any legal proceedings of a material
nature.
|
Period
|
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
(a)
|
April
1, 2007 –
April
30, 2007
|
42,705
|
$27.51
|
37,877
|
264,293
|
May
1, 2007 –
May
31, 2007
|
18,531
|
$27.81
|
18,531
|
245,762
|
June
1, 2007 –
June
30, 2007
|
1,361
|
$28.42
|
445
|
245,317
|
Total
for 2007
Second
Quarter
|
62,597
|
$27.62
|
56,853
|
245,317
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
|
|
Non applicable | |
Item
5.
|
Other
Information
|
|
|
Non applicable | |
Item
6.
|
Exhibits
|
|
Certification
of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
Act
|
||
Certification
of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
Act
|
||
Certification
of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley
Act
|
||
Certification
of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley
Act
|
First
Defiance Financial Corp.
|
||
(Registrant)
|
||
Date: August
9, 2007
|
By:
|
/s/
William J. Small
|
William
J. Small
|
||
Chairman,
President and
|
||
Chief
Executive Officer
|
||
Date: August
9, 2007
|
By:
|
/s/
John C. Wahl
|
John
C. Wahl
|
||
Executive
Vice President, Chief
|
||
Financial
Officer and
|
||
Treasurer
|