UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
July 24, 1997
FFY FINANCIAL CORP.
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(Exact name of registrant as specified in its charter)
Delaware 0-21638 34-1735753
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(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification
incorporation) Number)
724 Boardman-Poland Road, Youngstown, Ohio 44512
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 330-726-3396
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N/A
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(Former name or former address, if changed since last report)
Item 5. Other Events
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On July 24, 1997, the Registrant issued the attached press release.
Item 7. Financial Statements and Exhibits
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FFY FINANCIAL CORP. AND SUBSIDIARY
<TABLE>
<CAPTION>
Selected Consolidated Financial Condition Data: June 30, June 30, %
($ in thousands) 1997 1996 Change
-------- -------- ------
<S> <C> <C> <C>
Total assets $599,249 $575,602 4%
Loans receivable, net 460,712 438,790 5%
Allowance for loan losses 2,962 3,439 -14%
Non-performing assets 3,993 4,673 -15%
Securities available for sale 112,036 109,836 2%
Deposits 450,224 456,541 -1%
Securities sold under agreements to repurchase:
Short-term 7,307 6,640 10%
Long-term 25,000 0 NM
Borrowed funds 27,455 1,200 NM
Stockholders' equity 82,174 101,921 -19%
</TABLE>
<TABLE>
<CAPTION>
Three months ended Year ended
June 30, June 30,
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Selected Consolidated Operations Data: % %
($ in thousands except per share amounts) 1997 1996 Change 1997 1996 Change
---- ---- ------ ---- ---- ------
<S> <C> <C> <C> <C> <C> <C>
Total interest income $11,709 $11,041 6% $ 45,925 $ 43,716 5%
Total interest expense 6,219 5,468 14% 23,823 22,133 8%
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Net interest income 5,490 5,573 -1% 22,102 21,583 2%
Provision for loan losses 126 99 27% 688 325 112%
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Net interest income after
provision for loan losses 5,364 5,474 -2% 21,414 21,258 1%
Non-interest income 268 269 0% 938 1,070 -12%
Gain (loss) on sale of securities 25 9 NM (320) 30 NM
Total non-interest expense (2,764) (2,929) -6% (14,288) (11,991) 19%
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Income before federal income taxes 2,893 2,823 2% 7,744 10,367 -25%
Federal income tax expense 886 927 -4% 2,420 3,465 -30%
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Net income $ 2,007 $ 1,896 6% $ 5,324 $ 6,902 -23%
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Earnings per share $ 0.50 $ 0.39 28% $ 1.19 $ 1.37 -13%
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Cash dividends declared per share $ 0.175 $ 0.15 17% $ 0.70 $ 0.60 17%
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<F-NM> Not a meaningful measure of performance.
</TABLE>
FFY FINANCIAL CORP. AND SUBSIDIARY
<TABLE>
<CAPTION>
Three months ended Year ended
June 30, June 30,
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Selected Financial Ratios and Other Data: 1997 1996 1997 1996
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<S> <C> <C> <C> <C>
Performance Ratios:
Return on assets (ratio of net income to
average total assets) 1.34%(2) 1.32%(2) 0.90%(4) 1.20%
Interest rate spread information:
Average during period (3) 3.20%(2) 3.21%(2) 3.17% 3.04%
End of period (3) 3.06% 2.95% 3.06% 2.95%
Net interest margin (1) (3) 3.82%(2) 4.03%(2) 3.89% 3.89%
Ratio of operating expense to average
total assets 1.85%(2) 2.04%(2) 2.42%(4) 2.09%
Return on equity (ratio of net income
to average equity) 9.70%(2) 7.47%(2) 5.73%(4) 6.58%
Efficiency ratio 48.00% 50.14% 62.01%(4) 52.93%
Dividend payout ratio 35.00% 38.46% 58.82% 43.80%
Liquidity ratio (Bank only) 5.12% 7.57% 5.12% 7.57%
Quality Ratios:
Non-performing assets to total assets at end
of period 0.67% 0.81% 0.67% 0.81%
Allowance for loan losses to non-performing
assets 74.18% 73.59% 74.18% 73.59%
Provision for loan losses to total loans
receivable, net 0.11%(2) 0.09%(2) 0.15% 0.07%
Capital Ratios:
Equity to total assets at end of period 13.71% 17.71% 13.71% 17.71%
Average equity to average assets 13.82% 17.71% 15.71% 18.29%
Book value per share $19.83 $20.06 $19.83 $20.06
Change in book value per share
due to SFAS No. 115 $ 0.03 ($0.17) $ 0.03 ($0.17)
Ratio of average interest-earning assets to
average interest-bearing liabilities 1.14x 1.20x 1.17x 1.21x
Regulatory capital ratios: (Bank only)
Tangible capital - 1.50% required 9.56% 9.88% 9.56% 9.88%
Core capital - 3.00% required 9.56% 9.88% 9.56% 9.88%
Risk-based capital - 8.00% required 17.04% 17.78% 17.04% 17.78%
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<F1> Net interest income divided by average interest earning assets -
calculated without consideration of the unrealized loss on securities
available for sale.
<F2> Annualized.
<F3> Ratio is presented on a fully taxable equivalent basis using the
company's federal statutory tax rate of 34%.
<F4> Ratio would be positively effected if calculated without regard to the
SAIF special assessment of $3,011.
</TABLE>
(a) Exhibits
20. Press release, dated July 24, 1997.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
FFY FINANCIAL CORP.
Date: July 28, 1997 By: /s/ Jeffrey L. Francis
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Jeffrey L. Francis,
President and CEO
For Immediate Release For Further Information:
Thursday, July 24, 1997 Jeff Francis, President and CEO
Terri Liutkus, Treasurer and CFO
330/726-3396 - telephone
330/758-1356 - telecopier
FFY Financial Corp. Reports FY97 Net Income of $5.3 Million
$1.19 Annual Net Earnings Per Share
$.50 4th Quarter Earnings Per Share
Youngstown, Ohio July 24, 1997 - FFY Financial Corp. (NASDAQ: FFYF)
announced net income of $5.3 million or $1.19 per share for its fiscal year
ended June 30, 1997. Earnings for the current year compare to $6.9 million
or $1.37 per share for the year ended June 30, 1996. The decline in
earnings for the current year was primarily due to a one-time charge
assessed in the 1st quarter of the fiscal year of approximately $2.0 million
after tax resulting from legislation to recapitalize the Savings Association
Insurance Fund (SAIF).
Earnings for the 4th quarter ended June 30, 1997 totaled $2.0 million
or $.50 per share, representing a 6% increase in net income and 28% increase
in earnings per share compared to the 4th quarter last year.
Assets totaled $599.2 million at June 30, 1997, an increase of $23.6
million, or 4.1% from $575.6 million at June 30, 1996. Net loans receivable
increased $21.9 million and totaled $460.7 million at June 30, 1997 with
growth predominantly in 1-4 family mortgages. Deposits totaled $450.2
million at June 30, 1997, a decline of $6.3 million, or 1.4% from $456.5
million at June 30, 1996 due primarily to the maturity of brokered
certificates of deposit particularly in the 3rd quarter of the year. Growth
in assets was funded largely through borrowings and long term repurchase
agreements, which totaled $27.5 million and $25.0 million, respectively at
June 30, 1997, enabling the Company to further leverage its excess capital.
Nonperforming indirect auto loans totaled $400,000 at June 30, 1997, a
64% decline from $1.1 million at December 31, 1996 and a 51% decline from
$812,000 at March 31, 1997. The provision for loan losses totaled $688,000
for the current year due to losses in the indirect auto loan portfolio. The
allowance for losses on this portfolio is 102.7% of nonperforming loans at
June 30, 1997. At March 31, 1997, after an analysis of the returns
generated by the existing portfolio and potential returns from such a line
of business, the Bank exited the indirect auto loan business.
In November 1996, the Company commenced a Modified Dutch Auction
Tender Offer whereby FFY Financial offered to purchase up to 1.5 million
shares of its common stock within a price range of $24 to $26 per share. On
December 31, 1996, as a result of the offer, the Company purchased 808,000
shares, approximately 15.8% of the shares outstanding, at $26.00 per share
at a total cost of $21.2 million. On July 18, 1997, the Company announced
the completion of its share buyback program which began on April 21, 1997
where the Company purchased 215,943 shares, approximately 5% of the shares
outstanding, at an average price of $25.95 per share. As a result of these
transactions, capital has been reduced by 19.4%; from $101.9 million or
17.7% of assets at June 30, 1996 to $82.2 million or 13.7% of total assets
at June 30, 1997. Since completing its conversion to a publicly owned stock
company on June 28, 1993, the Company has repurchased 2.8 million shares, or
approximately 42% of the shares initially issued in the conversion, at an
average price of $21.19 per share.
At its meeting on July 15, 1997 the Company's board of directors
approved its regular quarterly dividend of 17.5 cents per share. The
dividend will be paid on August 14, 1997 to shareholders of record on July
31,1997.
Except for the historical information contained herein, the matters
discussed in this press release may be deemed to be forward-looking
statements that involve risks and uncertainties, including changes in
economic conditions in the Company's market area, changes in policies by
regulatory agencies, fluctuations in interest rates, demand for loans in the
Company's market area and competition, and other risks detailed from time to
time in the Company's SEC reports, including the report on Form 10-K for the
year ended June 30, 1996 and Form 10-Q for the quarters ended September 30,
1996, December 31, 1996 and March 31, 1997. Actual strategies and results
in future periods may differ materially from those currently expected.
These forward-looking statements represent the Company's judgment as of the
date of this release. The Company disclaims, however, any intent or
obligation to update these forward-looking statements.
