Hot Stock under Consideration: Territorial Bancorp Inc. (NASDAQ: TBNK)

Charles Barnes

I am Charles Barnes and I focus on breaking news stories and ensuring we (“Import Tourism”) offer timely reporting on some of the most recent stories released through market wires about “Financial” sector.

I have formerly spent over 3 years as a trader in U.S. Stock Market and is now semi-stepped down. I work on a full time basis for Import Tourism specializing in quicker moving active shares with a short term view on investment opportunities and trends.

Address: 3819 Sun Valley Road, George, WA 98824, USA
Phone: (+1) 509-785-0774
Email: charlesbarnes@importtourism.com
Charles Barnes

HONOLULU, July 14, 2019 – Shares of Territorial Bancorp Inc. (NASDAQ: TBNK) lost -0.17% to $29.90. The stock traded total volume of 12.111K shares higher than the average volume of 11.45K shares.

Territorial Bancorp Inc. (TBNK) declared net income of $6.52M or $0.70 per fully- diluted share for the three months ended March 31, 2019, contrast to $4.82M or $0.51 per fully-diluted share for the three months ended March 31, 2018.

Interest Income:

Net interest income reduced to $14.84M for the three months ended March 31, 2019 from $15.24M for the three months ended March 31, 2018. Total interest income was $18.71M for the three months ended March 31, 2019 contrast to $18.23M for the three months ended March 31, 2018. The $471.0K growth in total interest income was because of a $701.0K increase in interest income on loans which resulted mainly from the $82.09M increase in the average loans receivable. The growth in interest income on loans was offset by a $258.0K decline in interest income on investment securities. The decrease earned on securities occurred mainly because of a $34.90M decline in the average securities portfolio balance that occurred because of repayments on the securities portfolio.

Interest Expense:

Total interest expense rose to $3.87M for the three months ended March 31, 2019 from $3.00M for the three months ended March 31, 2018. Interest expense on deposits increased to $3.22M for the three months ended March 31, 2019 from $2.45M for the three months ended March 31, 2018. The increase in interest expense on deposits occurred mainly because of a $24.07M increase in average total deposits and a 19 basis point increase in the average cost of deposits. Interest expense on advances from the FHLB increased to $555.0K for the three months ended March 31, 2019 contrast to $419.0K for the three months ended March 31, 2018. This increase was because of a $9.50M increase in the average balance of FHLB advances and a 35 basis point increase in the average cost of advances for the three months ended March 31, 2019 as contrast to three months ended March 31, 2018.

Noninterest Income:

Noninterest income was $3.44M for the three months ended March 31, 2019 contrast to $742.0K for the three months ended March 31, 2018. The increase in noninterest income was mainly because of a $2.72M gain on sale of a trust preferred security investment. This security was written down in 2010. The $2.72M gain exceeded the write down.

Noninterest Expense:

Noninterest expense was $9.77M for the three months ended March 31, 2019 contrast to $9.39M for the three months ended March 31, 2018. The increase in noninterest expense was mainly because of a $151.0K increase in equipment expense, a $76.0K increase in occupancy expense and a $124.0K increase in other general and administrative expenses.

Income Taxes:

Income tax expense for the three months ended March 31, 2019 was $1.97M contrast to $1.76M for the three months ended March 31, 2018. This increase in income tax expense was mainly because of the $1.92M increase in income before taxes for the quarter ended March 31, 2019 as contrast to the quarter ended March 31, 2018. The increase in income tax expense that occurred because of the increase in income before taxes was partially offset by a $69.0K increase in the tax benefits related to the exercise of stock options in the quarter ended March 31, 2019.

Assets and Equity:

Total assets reduced to $2.06B at March 31, 2019 from $2.07B at December 31, 2018. Loans receivable grew by $11.88M to $1.59B at March 31, 2019 from $1.57B at December 31, 2018. The growth in loans receivable occurred as residential mortgage loan originations exceeded loan repayments. Cash and cash equivalents reduced by $23.40M to $23.67M at March 31, 2019 from $47.06M at December 31, 2018. During the same period, deposits rose by $38.22M to $1.67B at March 31, 2019 from $1.63B at December 31, 2018. The decrease in cash and cash equivalents and the additional deposits were used to pay off $37.70M of Federal Home Loan Bank advances and $20.00M of securities sold under agreements to repurchase. During the quarter ending March 31, 2019, the Company transferred investment securities with a book value of $11.39M and a market value of $11.80M to its available for sale investment portfolio from its held to maturity investment portfolio. The transfer was made when the Company adopted the amended Derivatives and Hedging topic of the FASB ASC. On January 1, 2019, the Company also adopted the amended Lease topic of the FASB ASC by capitalizing net present value of future lease payments and recording a right-of-use asset and a million lease liabilities. The right-of-use asset and lease liability had balances of $12.30M and $12.79M, respectively, at March 31, 2019. Total stockholders’ equity increased to $238.84M at March 31, 2019 from $235.08M at December 31, 2018. The increase in stockholders’ equity occurred as the Company’s net income and the increase in capital from the exercise of stock options and the allocation of ESOP shares exceeded dividends paid to shareholders and share repurchases.

Capital Management:

During the quarter ended March 31, 2019, the Company repurchased $1.60M, or 59,700 shares under in its eighth repurchase program. Through March 31, 2019, the Company has repurchased a total of 3,501,353 shares. The shares repurchased represent 28.62% of the total shares issued in its initial public offering.

As of March 31, 2019, the Company has 263.094K of outstanding, exercisable stock options. The exercise of options would increase the number of shares outstanding, which among other things, would reduce earnings per share.

Asset Quality:

Total delinquent loans 90 days or more past due and not accruing totaled $879.0K at March 31, 2019 and at December 31, 2018. Non-performing assets totaled $2.18M at March 31, 2019 contrast to $2.21M at December 31, 2018. The ratio of non-performing assets to total assets was 0.11% at March 31, 2019 and at December 31, 2018. The allowance for loan losses at March 31, 2019 was $2.66M and represented 0.17% of total loans contrast to $2.64M and 0.17% of total loans as of December 31, 2018.

TBNK has the market capitalization of $285.54M and its EPS growth ratio for the past five years was 6.50%. The return on assets ratio of the Company was 1.00% while its return on investment ratio stands at 22.80%. Price to sales ratio was 3.87 while 46.50% of the stock was owned by institutional investors.

Charles Barnes

Charles Barnes

I am Charles Barnes and I focus on breaking news stories and ensuring we (“Import Tourism”) offer timely reporting on some of the most recent stories released through market wires about “Financial” sector. I have formerly spent over 3 years as a trader in U.S. Stock Market and is now semi-stepped down. I work on a full time basis for Import Tourism specializing in quicker moving active shares with a short term view on investment opportunities and trends. Address: 3819 Sun Valley Road, George, WA 98824, USA Phone: (+1) 509-785-0774 Email: charlesbarnes@importtourism.com