Exhibit 99.1




FOR IMMEDIATE RELEASE

QUAINT OAK BANCORP, INC. ANNOUNCES FIRST 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 March 31, 2019 was $413,000, or $0.21 per basic and diluted share, compared to $288,000, or $0.15 per basic and $0.14 per diluted share for the same period in 2018.

Robert T. Strong, President and Chief Executive Officer stated, “We are very pleased to report that the Company’s first quarter earnings are 43% higher than the same period of one year ago.  Loan production of $18.8 million in loans closed by our Bank along with $18.2 million in loans closed by the Bank’s mortgage company subsidiary during the quarter ended March 31, 2019, was a primary driver for first quarter earnings.  Our performance during the quarter more than offset the additional interest expense from our $8.0 million subordinated debt offering completed at the end of 2018.”

Mr. Strong continued, “I am additionally pleased that our stockholders will benefit from these earnings as we recently announced an increase in our cash dividend by $0.02 per share bringing the quarterly cash dividend from $0.07 to $0.09 per share.  This represents an increase of 29% over the prior dividend rate.  Our stockholders’ equity at March 31, 2019 reflected the increase in net income for the quarter combined with modest stock repurchase activity that continues to improve our book value per share.  The Company acquired over 9,300 shares during the first quarter of 2019.”

Mr. Strong added, “Our credit quality continued to improve as our non-performing loans as a percent of total loans receivable, net, declined to 0.40% at March 31, 2019 compared to 1.31% at March 31, 2018.  Additionally, our Texas Ratio was 10.34% at March 31, 2019, down from 11.56% at March 31, 2018. Needless to say, we are very pleased that loan quality remains high within the Bank’s portfolio.”

Mr. Strong commented, “Including the shares repurchased in the first quarter as mentioned above, the Company has now repurchased approximately 39% of the original shares issued in our initial public offering.  As always, in conjunction with having maintained a strong repurchase plan, 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 $413,000 for the three months ended March 31, 2019, an increase of $125,000, or 43.4%, compared to net income of $288,000 for the three months ended March 31, 2018.  The increase in net income on a comparative quarterly basis was primarily the result of an increase in net interest income of $158,000 and an increase non-interest income of $100,000, partially offset by an increase in the provision for income taxes of $119,000 and an increase in the provision for loan losses of $14,000.







    The $158,000, or 8.0% increase in net interest income for the three months ended March 31, 2019 over the comparable period in 2018 was driven by a $567,000, or 20.0%, increase in interest income, partially offset by a $409,000, or 47.8%, increase in interest expense.  The increase in interest income was primarily due to a $15.4 million increase in average loans receivable, net, including loans held for sale, which increased from an average balance of $207.8 million for the three months ended March 31, 2018 to an average balance of $223.2 million for the three months ended March 31, 2019, and had the effect of increasing interest income $200,000. Also contributing to this increase was a 41 basis point increase in the yield on average loans receivable, net, including loans held for sale, which increased from 5.21% for the three months ended March 31, 2018 to 5.62% for the three months ended March 31, 2019, which had the effect of increasing interest income $213,000.  The increase in interest income was also due to a $17.0 million increase in average cash and cash equivalents due from banks, interest bearing, which increased from an average balance of $12.4 million for the three months ended March 31, 2018 to an average balance of $29.4 million for the three months ended March 31, 2019, and had the effect of increasing interest income $67,000.  Also contributing to this increase was a 49 basis point increase in the yield on average cash and cash equivalents due from banks, interest bearing, which increased from 1.61% for the three months ended March 31, 2018 to 2.10% for the three months ended March 31, 2019, which had the effect of increasing interest income $16,000.  The increase in interest expense was primarily attributable to a $23.8 million increase in average certificate of deposit accounts which increased from an average balance of $148.6 million for the three months ended March 31, 2018 to an average balance of $172.4 million for the three months ended March 31, 2019, and had the effect of increasing interest expense $107,000.  Also contributing to this increase was a 39 basis point increase in rate on average certificate of deposit accounts, which increased from 1.80% for the three months ended March 31, 2018 to 2.19% for the three months ended March 31, 2019, and had the effect of increasing interest expense by $147,000.  The increase in interest expense was also due to average subordinated debt of $7.8 million for the three months ended March 31, 2019, at the applicable interest rate of 6.5%, which had the effect of increasing interest expense by $129,000 compared to no effect for the three months ended March 31, 2018.  The average interest rate spread decreased from 3.21% for the three months ended March 31, 2018 to 2.90% for the three months ended March 31, 2019 while the net interest margin decreased from 3.38% for the three months ended March 31, 2018 to 3.19% for the three months ended March 31, 2019.

The $14,000, or 19.7% increase in the provision for loan losses for the three months ended March 31, 2019 over the three months ended March 31, 2018 was based on an evaluation of the allowance relative to such factors as volume of the loan portfolio, concentrations of credit risk, prevailing economic conditions, prior loan loss experience and amount of non-performing loans at March 31, 2019.

The $100,000, or 13.5% increase in non-interest income for the three months ended March 31, 2019 over the comparable period in 2018 was primarily attributable to a $109,000, or 33.6%, increase in net gain on the sales of loans held for sale, an $83,000, or 360.9%, increase in gain on the sale of SBA loans, a $35,000, or 31.8%, increase in mortgage banking and abstract fees, and a $13,000, or 17.6%, increase in insurance commissions. These increases were offset by a $63,000, decrease in the gain on the sales of other real estate owned, a $46,000, or 62.2% decrease on other fees and service charges, and a $31,000, or 39.2%, decrease in real estate sales commissions, net.

Total non-interest expense of $2.3 million for the three months ended March 31, 2019 was unchanged from the three months ended March 31, 2018.  Professional fees increased $22,000, or 36.7%, advertising expense increased $17,000, or 31.5%, data processing expense increased $16,000, or 18.6%, occupancy and equipment expense increased $10,000, or 6.7%, other real estate owned expenses increased $7,000, and director fees increased $3,000, or 5.6%.  These increases were offset by $42,000, or 2.5% decrease in salaries and benefits expense, a $19,000, or 40.4%, decrease in FDIC deposit insurance assessment, and a $14,000, or 8.0%, decrease in other expense.

The provision for income tax increased $119,000, or 216.4%, from $55,000 for the three months ended March 31, 2018 to $174,000 for the three months ended March 31, 2019 due primarily to the increase in pre-tax income and an increase in our effective tax rate from 16.0% for the three months ended March 31, 2018 to 29.6% for the three months ended March 31, 2019.  The increase in our effective tax rate was primarily due a tax deduction taken in the first quarter of 2018 related to the exercise of non-qualified stock options during the three months ended March 31, 2018.


2





The Company’s total assets at March 31, 2019 were $281.9 million, an increase of $10.5 million, or 3.9%, from $271.4 million at December 31, 2018.  This growth in total assets was primarily due to a $5.2 million, or 106.1%, increase in investment in interest-earning time deposits, a $2.5 million, or 1.2%, increase in loans receivable, net, and a $2.4 million, or 9.1%, increase in cash and cash equivalents.  The largest increase within the loan portfolio occurred in commercial business loans which increased $5.5 million, or 23.1%.  This increase was partially offset by a $1.8 million, or 17.6%, decrease in construction loans and a $1.4 million, or 2.9%, decrease in one-to-four family residential non-owner occupied loans.

Total deposits increased $10.1 million, or 4.8%, to $222.0 million at March 31, 2019 from $211.9 million at December 31, 2018. This increase in deposits was primarily attributable to increases of $12.9 million, or 7.8%, in certificates of deposit and $1.5 million, or 5.6%, in money market accounts, partially offset by a $4.3 million, or 24.5%, decrease in non-interest bearing checking accounts.

Total stockholders’ equity increased $370,000, or 1.6%, to $24.2 million at March 31, 2019 from $23.8 million at December 31, 2018.  Contributing to the increase was net income for the three months ended March 31, 2019 of $413,000, the reissuance of treasury stock for exercised stock options of $109,000, common stock earned by participants in the employee stock ownership plan of $45,000, amortization of stock awards and options under our stock compensation plans of $43,000, the reissuance of treasury stock under the Bank’s 401(k) Plan of $12,000, and other comprehensive income, net of $1,000.  These increases were partially offset by dividends paid of $138,000 and by the purchase of treasury stock of $115,000.

Non-performing loans amounted to $880,000 or 0.40% of net loans receivable at March 31, 2019, consisting of five loans, two of which are on non-accrual status and three of which are 90 days or more past due and accruing interest. Comparably, non-performing loans amounted to $1.2 million, or 0.54% of net loans receivable at December 31, 2018, consisting of six loans, three of which were on non-accrual status and three of which were 90 days or more past due and accruing interest.  The non-performing loans at March 31, 2019 include two one-to-four family non-owner occupied residential loans, one one-to-four family owner occupied residential loan, one commercial real estate loan, and one construction loan, and all are generally well-collateralized or adequately reserved for.  During the quarter ended March 31, 2019, one loan that was previously on non-accrual status was paid-off.  The allowance for loan losses as a percent of total loans receivable was 0.93% at March 31, 2019 and 0.90% at December 31, 2018.

Other real estate owned (OREO) amounted to $1.74 million at March 31, 2019, consisting of one property that was collateral for a non-performing construction loan.  During the quarter ended March 31, 2019, the Company made $94,000 of capital improvements to the property.  The balance of this OREO property amounted to $1.65 million at December 31, 2018.  Non-performing assets amounted to $2.6 million, or 0.93% of total assets at March 31, 2019 compared to $2.8 million, or 1.04% of total assets at December 31, 2018.

Quaint Oak Bancorp, Inc. is the parent company for the Quaint Oak Family of Companies.  Quaint Oak Bank, a Pennsylvania-chartered stock savings bank and wholly-owned subsidiary of the Company, headquartered in Southampton, Pennsylvania and the Bank’s subsidiary companies conduct business through two regional offices located in the Delaware Valley and Lehigh Valley markets, a Chalfont, PA and a Philadelphia, PA location.  Quaint Oak Bank’s subsidiary companies include Quaint Oak Abstract, LLC, Quaint Oak Insurance Agency, LLC, Quaint Oak Mortgage, LLC and Quaint Oak Real Estate, LLC.

Statements contained in this news release which are not historical facts may be forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors. Factors which could result in material variations include, but are not limited to, changes in interest rates which could affect net interest margins and net interest income, competitive factors which could affect net interest income and noninterest income, changes in demand for loans, deposits and other financial services in the Company's market area; changes in asset quality, general economic conditions as well as other factors discussed in documents filed by the Company with the Securities and Exchange Commission from time to time. The Company undertakes no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date on which such statements were made.



3





QUAINT OAK BANCORP, INC.
Consolidated Balance Sheets
(In Thousands)
 
             
   
At March 31,
2019
   
At December 31,
2018
 
   
(Unaudited)
   
(Unaudited)
 
Assets
           
Cash and cash equivalents
 
$
28,378
   
$
26,012
 
Investment in interest-earning time deposits
   
10,153
     
4,927
 
Investment securities available for sale at fair value
   
6,493
     
6,680
 
Loans held for sale
   
4,213
     
5,103
 
Loans receivable, net of allowance for loan losses (2019: $2,050; 2018: $1,965)
   
219,442
     
216,898
 
Accrued interest receivable
   
1,255
     
1,153
 
Investment in Federal Home Loan Bank stock, at cost
   
1,086
     
1,086
 
Bank-owned life insurance
   
3,914
     
3,894
 
Premises and equipment, net
   
2,061
     
2,058
 
      Goodwill
   
515
     
515
 
Other intangible, net of accumulated amortization
   
356
     
368
 
Other real estate owned, net
   
1,744
     
1,650
 
Prepaid expenses and other assets
   
2,309
     
1,060
 
Total Assets
 
$
281,919
   
$
271,404
 
                 
Liabilities and Stockholders’ Equity
 
Liabilities
               
Deposits
               
       Non-interest bearing
 
$
13,243
   
$
17,542
 
       Interest-bearing
   
208,743
     
194,369
 
           Total deposits
   
221,986
     
211,911
 
Federal Home Loan Bank advances
   
24,000
     
24,000
 
Subordinated debt
   
7,840
     
7,831
 
Accrued interest payable
   
364
     
221
 
Advances from borrowers for taxes and insurance
   
1,690
     
2,568
 
Accrued expenses and other liabilities
   
1,833
     
1,037
 
Total Liabilities
   
257,713
     
247,568
 
Stockholders’ Equity
   
24,206
     
23,836
 
Total Liabilities and Stockholders’ Equity
 
$
281,919
   
$
271,404
 
                 



4




QUAINT OAK BANCORP, INC.
Consolidated Statements of Income
(In Thousands)

 
For the Three Months Ended
March 31,
 
 
2019
   
2018
 
   
(Unaudited)
 
Interest Income
 
$
3,402
   
$
2,835
 
Interest Expense
   
1,265
     
856
 
Net Interest Income
   
2,137
     
1,979
 
Provision for Loan Losses
   
85
     
71
 
Net Interest Income after Provision for Loan Losses
   
2,052
     
1,908
 
Non-Interest Income
   
842
     
742
 
Non-Interest Expense
   
2,307
     
2,307
 
      Income before Income Taxes
   
587
     
343
 
Income Taxes
   
174
     
55
 
Net Income
 
$
413
   
$
288
 

 
Three Months Ended
March 31,
 
Per Common Share Data:
2019
   
2018
 
  Earnings per share – basic
 
$
0.21
   
$
0.15
 
  Average shares outstanding – basic
   
1,940,363
     
1,881,865
 
  Earnings per share – diluted
 
$
0.21
   
$
0.14
 
  Average shares outstanding - diluted
   
1,991,779
     
1,990,290
 
  Book value per share, end of period
 
$
12.22
   
$
11.50
 
  Shares outstanding, end of period
   
1,981,091
     
1,954,571
 
                 
 
Three Months Ended
March 31,
 
Selected Operating Ratios:
   
2019
     
2018
 
  Average yield on interest-earning assets
   
5.07
%
   
4.84
%
  Average rate on interest-bearing liabilities
   
2.17
%
   
1.63
%
  Average interest rate spread
   
2.90
%
   
3.21
%
  Net interest margin
   
3.19
%
   
3.38
%
  Average interest-earning assets to average interest-bearing liabilities
   
115.03
%
   
111.47
%
  Efficiency ratio
   
77.45
%
   
84.76
%
                 
Asset Quality Ratios (1):
               
  Non-performing loans as a percent of total loans receivable, net
   
0.40
%
   
1.31
%
  Non-performing assets as a percent of total assets
   
0.93
%
   
1.08
%
  Allowance for loan losses as a percent of non-performing loans
   
232.85
%
   
67.89
%
  Allowance for loan losses as a percent of total loans receivable
   
0.93
%
   
0.88
%
  Texas Ratio (2)
   
10.34
%
   
11.56
%
_________________________
               
(1) Asset quality ratios are end of period ratios.
               
(2) Total non-performing assets divided by consolidated tangible common equity plus the allowance for loan losses.
 


Contact:
   
Quaint Oak Bancorp, Inc.
Robert T. Strong, President and Chief Executive Officer
(215) 364-4059
 






5

View differences made from one to another to evaluate Quaint Oak Bancorp Inc's financial trajectory

Compare SEC Filings Year-over-Year (YoY) and Quarter-over-Quarter (QoQ)
Sample 10-K Year-over-Year (YoY) Comparison

Compare this 8-K Corporate News to its predecessor by reading our highlights to see what text and tables were  removed  ,   added    and   changed   by Quaint Oak Bancorp Inc.

Continue

Never Miss A New SEC Filing Again


Real-Time SEC Filing Notifications
Screenshot taken from Gmail for a new 10-K Annual Report
Last10K.com Member Feature

Receive an e-mail as soon as a company files an Annual Report, Quarterly Report or has new 8-K corporate news.

Continue

We Highlighted This SEC Filing For You


SEC Filing Sentiment Analysis - Bullish, Bearish, Neutral
Screenshot taken from Wynn's 2018 10-K Annual Report
Last10K.com Member Feature

Read positive and negative remarks made by management in their entirety without having to find them in a 10-K/Q.

Continue

Widen Your SEC Filing Reading Experience


Increased Reading Area for SEC Filings
Screenshot taken from Adobe Inc.'s 10-Q Quarterly Report
Last10K.com Member Feature

Remove data columns and navigations in order to see much more filing content and tables in one view

Continue

Uncover Actionable Information Inside SEC Filings


SEC Filing Disclosures
Screenshot taken from Lumber Liquidators 10-K Annual Report
Last10K.com Member Feature

Read both hidden opportunities and early signs of potential problems without having to find them in a 10-K/Q

Continue

Adobe PDF, Microsoft Word and Excel Downloads


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshots of actual 10-K and 10-Q SEC Filings in PDF, Word and Excel formats
Last10K.com Member Feature

Export Annual and Quarterly Reports to Adobe PDF, Microsoft Word and Excel for offline viewing, annotations and analysis

Continue

FREE Financial Statements


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshot of actual balance sheet from company 10-K Annual Report
Last10K.com Member Feature

Get one-click access to balance sheets, income, operations and cash flow statements without having to find them in Annual and Quarterly Reports

Continue for FREE

Log in with your credentials

or    

Forgot your details?

Create Account