Exhibit 99.1
 

 
FOR RELEASE:  Monday, July 23, 2018 at
4:30 PM (Eastern)

QUAINT OAK BANCORP, INC. ANNOUNCES SECOND QUARTER EARNINGS

Southampton, PA – Quaint Oak Bancorp, Inc. (the "Company") (OTCQX: QNTO), the holding company for Quaint Oak Bank (the "Bank"), announced today that net income for the quarter ended June 30, 2018 was $535,000, or $0.28 per basic and $0.27 per diluted share, compared to $524,000, or $0.28 per basic and $0.26 per diluted share for the same period in 2017.  Net income for the six months ended June 30, 2018 was $823,000, or $0.43 per basic and $0.42 per diluted share, compared to $695,000, or $0.38 per basic and $0.35 per diluted share for the same period in 2017.

Robert T. Strong, President and Chief Executive Officer stated, "We are pleased to report that our total assets increased 6.8% to $255.9 million at June 30, 2018 when compared to December 31, 2017, largely driven by a $15.8 million increase in total deposits over the same period.  Our growth in deposits was used in part to fund loan closings which reached a high point in June at both our bank and our mortgage company subsidiaries.  This resulted in increases in both non-interest income and net interest income for the three and six months ended June 30, 2018."

Mr. Strong continued, "As we move into the second half of 2018, we continue to focus on the long term growth in each of our operating companies.  However, continually increasing the loan volume at both our bank and our mortgage company subsidiaries remains the immediate driver for improved earnings."

Mr. Strong added, "Although, the Bank's Texas Ratio increased marginally by 1.99% over the six month period when compared to the same period of one year ago; the Bank's non-performing loans as a percent of total loans receivable, net, decreased to 0.38% at June 30, 2018.  We are pleased that loan quality remains high within the Bank's portfolio."

Mr. Strong commented, "As always, in conjunction with having maintained a strong repurchase plan that has repurchased over 37% of our original shares issued in our initial public offering, our current and continued business strategy includes long term profitability and payment of dividends reflecting our strong commitment to shareholder value."

Net income amounted to $535,000 for the three months ended June 30, 2018, an increase of $11,000, or 2.1%, compared to net income of $524,000 for three months ended June 30, 2017.  The increase in net income on a comparative quarterly basis was primarily the result of an increase in net interest income of $171,000, a decrease in the provision for income taxes of $104,000, and an increase in non-interest income of $59,000, partially offset by an increase in non-interest expense of $293,000 and an increase in the provision for loan losses of $30,000.
 
     The $171,000, or 9.1%, increase in net interest income for the three months ended June 30, 2018 over the comparable period in 2017 was driven by a $395,000, or 15.2%, increase in interest income, partially offset by a $224,000, or 31.3%, increase in interest expense.  The increase in interest income was primarily due to a $25.7 million increase in average loans receivable, net, including loans held for sale, which increased from an average balance of $187.9 million for the three months ended June 30, 2017 to an average balance of $213.6 million for the three months ended June 30, 2018, and had the effect of increasing interest income $345,000.  The increase in interest income was also due to a $10.4 million increase in average cash and cash equivalents due from banks, interest bearing, which increased from an average balance of $6.7 million for the three months ended June 30, 2017 to an average balance of $17.1 million for the three months ended June 30, 2018, and had the effect of increasing interest income $27,000.  Also contributing to this increase was a 64 basis point increase in the yield on average cash and cash equivalents due from banks, interest bearing, which increased from 1.02% for the three months ended June 30, 2017 to 1.66% for the three months ended June 30, 2018, which had the effect of increasing interest income $27,000.  The increase in interest expense was primarily attributable to a $28.2 million increase in average interest-bearing liabilities, which increased from an average balance of $189.0 million for the three months ended June 30, 2017 to an average balance of $217.2 million for the three months ended June 30, 2018, and had the effect of increasing interest expense $122,000.  This increase in average interest-bearing liabilities was primarily attributable to an $18.7 million increase in average certificate of deposit accounts which increased from an average balance of $136.2 million for the three months ended June 30, 2017 to an average balance of $154.9 million for the three months ended June 30, 2018, and had the effect of increasing interest expense $81,000, and an $11.1 million increase in average Federal Home Loan Bank borrowings which increased from an average balance of $16.9 million for the three months ended June 30, 2017 to an average balance of $28.0 million for the three months ended June 30, 2018, and had the effect of increasing interest expense $45,000.  Also contributing to this increase was a 22 basis point increase in the average rate on interest-bearing liabilities, from 1.51% for the three months ended June 30, 2017 to 1.73% for the three months ended June 30, 2018, which had the effect of increasing interest expense by $102,000.  This increase in rate was primarily attributable to an 18 basis point increase in rate on average certificate of deposit accounts, which increased from 1.72% for the three months ended June 30, 2017 to 1.90% for the three months ended June 30, 2018, and had the effect of increasing interest expense by $68,000, and a 55 basis point  increase in rate on average Federal Home Loan Bank borrowings, which increased from 1.44% for the three months ended June 30, 2017 to 1.99% for the three months ended June 30, 2018, which had the effect of increasing interest expense by $34,000.  The average interest rate spread decreased from 3.45% for the three months ended June 30, 2017, to 3.18% for the same period in 2018 while the net interest margin decreased from 3.60% for the three months ended June 30, 2017 to 3.37% for the three months ended June 30, 2018.
1

The following information was filed by Quaint Oak Bancorp Inc (QNTO) on Monday, July 23, 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-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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