Essa Bancorp, Inc. (ESSA) 10-K Annual Report Fri Dec 14 2018

Stroudsburg, PA. – October 24, 2018 — ESSA Bancorp, Inc. (the “Company”) (NASDAQ: ESSA) today announced financial results for fiscal three months and year ended September 30, 2018. The Company is the holding company for ESSA Bank & Trust (the “Bank”), a $1.8 billion asset institution, which provides full service retail and commercial banking, financial, and investment services from 22 locations in eastern Pennsylvania, including the Lehigh Valley, suburban Philadelphia and Northeastern Pennsylvania.

The Company reported net income of $3.1 million, or $0.28 per diluted share, for the fourth quarter ended September 30, 2018, compared with net income of $2.0 million, or $0.19 per diluted share, for the same quarter last year. For the year ended September 30, 2018, the Company reported net income of $6.5 million or $0.60 per diluted share, compared to $7.3 million or $0.69 per diluted share for the comparable period in 2017.

Results for the year ended September 30, 2018, reflected a one-time charge to income tax expense of $3.7 million recorded in the Company’s first fiscal quarter related to the reduction in the carrying value of the Company’s deferred tax assets, which resulted from the reduction in the Federal corporate income tax rate under the Tax Cuts and Jobs Act of 2017.

Gary S. Olson, President and CEO, commented: “We were pleased that throughout fiscal 2018, and particularly in the second half of the year, the Company generated accelerating interest income and loan growth from commercial lending. Strong underwriting and risk management ensured the quality of new and existing loans and banking relationships, which supported sound asset quality measurements. Deposit growth reflected a focus on earning a greater share of customers’ total banking business, and our goal of using internally generated product and other data to grow deposits even more.

New team members, organizational restructuring, greater productivity, and a market-focused operational structure played important roles in identifying the Company’s best growth opportunities and securing new business. Operationally, we implemented new systems and procedures for improved performance measurement and analysis, which contributed to greater efficiency and lower noninterest expense.”

HIGHLIGHTS

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Total interest income in the fourth quarter of 2018 was $16.6 million, up from $14.9 million for the three months ended September 30, 2017. Total interest income for the year ended September 30, 2018 rose to $64.5 million compared to $58.3 million for the fiscal year ended September 30, 2017.

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Net interest income was $12.0 million in the fourth quarter of 2018 compared to $11.4 million for the comparable period in 2017. Net interest income for the 2018 year was $48.2 million, up 6.0% from $45.5 million for the comparable period in 2017.

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Reduced compensation and employee benefit costs and selective facility closures were key components of a year-over-year decline in noninterest expense in fiscal 2018 compared with fiscal 2017 of 3.8%.

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Core deposits (demand, savings and money market accounts) were 60.7% of total deposits at September 30, 2018.

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Total net loans at September 30, 2018 were $1.31 billion, up 5.5% from September 30, 2017, with growth driven by commercial and government lending.

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Total commercial loans (commercial & industrial, commercial real estate, and government), increased 28.3% to $539.4 million at fiscal year-end 2018, compared to $420.5 million a year earlier.

The following information was filed by Essa Bancorp, Inc. (ESSA) on Thursday, October 25, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Essa Bancorp, Inc.'s 10-K Annual Report:

Financial - Earnings Highlight
Our business strategy is to grow and improve our profitability by: Increasing customer relationships through the offering of excellent service and the distribution of that service through effective delivery systems; Continuing to transform into a full service community bank by meeting the financial services needs of our customers; Continuing to develop into a high performing financial institution, in part by increasing interest revenue and fee income; Remaining within our risk management parameters; and Employing affordable technology to increase profitability and improve customer service.

Other - Other Highlight
Our primary sources of cash are principal repayments on loans, proceeds from the maturities of investment securities, principal repayments of mortgage-backed securities and increases in deposit accounts.
Financial - Income Highlight
We also intend to focus on the following: We consider accounting policies that require management to exercise significant judgment or discretion or make significant assumptions that have, or could have, a material impact on the carrying value of certain assets or on income, to be critical accounting policies.
Other - Other Highlight
As management evaluates the allowance for loan losses, the increased risk associated with larger non-homogenous commercial real estate may result in large additions to the allowance for loan losses in future periods.
Financial - Income Highlight
As of September 30, 2018, the level of net interest income at risk in a 200 basis points increase or a 200 basis point decrease was within the Companys policy limit of a decline less than 10% of net interest income.
Financial - Expense
The impact of inflation is...Read more
Financial - Income
Accordingly, although the net interest...Read more
Other - Other
The post retirement benefit payments...Read more
Other - Other
Overly optimistic assumptions or negative...Read more
Other - Other
As of September 30, 2018,...Read more
Other - Other
We believe, however, based on...Read more
Other - Other
In certain cases, however, when...Read more
Other - Other
Actual loan losses may be...Read more
Financial - Earnings
Our primary sources of liquidity...Read more
Other - Other
Additionally, such loans typically involve...Read more
Other - Other
We have access to FHLB...Read more

Financial Statements, Disclosures and Schedules

Inside this 10-K Annual Report

Material Contracts, Statements, Certifications & more

Essa Bancorp, Inc. provided additional information to their SEC Filing as exhibits

Exhibit 10.5: Material Contract

Exhibit 10.10: Material Contract

Exhibit 21: Subsidaries Of The Registrant

Exhibit 23: Consents Of Experts And Counsel

Exhibit 31.1: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 31.2: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 32: Section 1350 Certification

Ticker: ESSA
CIK: 1382230
Form Type: 10-K Annual Report
Accession Number: 0001564590-18-030936
Submitted to the SEC: Fri Dec 14 2018 11:02:59 AM EST
Accepted by the SEC: Fri Dec 14 2018
Period: Sunday, September 30, 2018
Industry: Savings Institutions Not Federally Chartered