Kentucky First Federal Bancorp(KFFB) - 2019 Q2 - Quarterly Report

Financial Performance - Net income for the six months ended December 31, 2018, was $305,000, a decrease of 73.4% from $1,149,000 in the same period of 2017[10] - Earnings per share for the six months ended December 31, 2018, was $0.04, down from $0.14 in the same period of 2017[10] - Net interest margin was 3.22% for the six months ended December 31, 2018, compared to 3.51% for the same period in 2017[84] - Net interest income before provision for loan losses decreased by $188,000 or 3.8% to $4.7 million for the six-month period ended December 31, 2018[102] - Non-interest income decreased by $464,000 or 80.6% to $112,000, primarily due to a decrease in earnings on bank-owned life insurance[108] - Federal income tax expense for the six months ended December 31, 2018, was $69,000, compared to an income tax benefit of $25,000 in the prior year[110] Assets and Liabilities - Total assets increased to $320,954,000 as of December 31, 2018, compared to $318,394,000 on June 30, 2018, reflecting a growth of 0.8%[8] - Total liabilities increased to $254,144,000 as of December 31, 2018, from $251,191,000 on June 30, 2018, marking a growth of 1.2%[8] - Cash and cash equivalents at the end of the period were $10,142,000, an increase from $9,943,000 at the end of June 30, 2018[8] - Deposits rose to $197,277,000 as of December 31, 2018, compared to $195,653,000 on June 30, 2018, an increase of 0.8%[8] - Shareholders' equity decreased by $393,000, or 0.6%, to $66.8 million at December 31, 2018[98] Loans and Credit Quality - The total loans receivable as of December 31, 2018, amounted to $273,111,000, an increase from $270,310,000 as of June 30, 2018, representing a growth of approximately 1%[41] - The allowance for loan losses decreased from $1,576,000 to $1,529,000 over the six months ended December 31, 2018, indicating a reduction of about 3%[42] - Non-performing loans totaled approximately $8.3 million, or 3.0% of total loans, as of December 31, 2018[91] - The allowance for loan losses represented 18.4% of non-performing loans and 0.6% of total loans at December 31, 2018[91] - The recorded investment in nonaccrual loans was $6.184 million as of December 31, 2018, compared to $5.246 million on June 30, 2018, indicating an increase in nonaccrual loans[49] Interest Income and Expense - Total interest income rose to $6,224,000 for the six months ended December 31, 2018, up 5.8% from $5,885,000 in 2017[10] - Interest income on loans increased by $286,000 or 5.1% to $5.9 million, driven by a $12.1 million or 4.7% increase in the average loan portfolio balance[103] - Interest expense on deposits increased by $294,000 or 46.3% to $929,000, attributed to a 27 basis point increase in the average rate paid on deposits[105] Securities and Investments - At December 31, 2018, the Company's available-for-sale securities had an amortized cost of $545,000 and a fair value of $547,000[37] - The fair value of agency mortgage-backed residential assets was $44,000, and agency bonds were valued at $503,000[70] - The company reported unrealized holding gains on available-for-sale securities of $1,000 for the six months ended December 31, 2018[80] Regulatory and Compliance - The Company adopted ASU No. 2014-09 effective July 1, 2018, resulting in a cumulative-effect adjustment of $441,000 to retained earnings[26] - The Company has formed a functional committee to assess data and system needs for the upcoming adoption of ASU 2016-13, which will impact credit loss evaluations[33] - The Company reported no significant changes in internal control over financial reporting for the quarter ended December 31, 2018[124] - The certifications by the CEO and CFO were completed in accordance with the Sarbanes-Oxley Act of 2002[132] Miscellaneous - The Company operates primarily through its two banking subsidiaries, First Federal of Hazard and First Federal of Kentucky, focusing on community-oriented services[20] - The Company repurchased its common stock during the quarter ended December 31, 2018, with specific details provided in the financial statements[128] - The Company has not disclosed any legal proceedings during this reporting period[126]