SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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)
February 15, 2000
WESTERFED FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its Charter)
Delaware 0-22772 81-0487794
- --------------------------------------------------------------------------------
(State or other (Commission File No.) (IRS Employer
jurisdiction of Identification
incorporation) Number)
110 East Broadway, Missoula, Montana 59802
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (406) 721-5254
- --------------------------------------------------------------------------------
N/A
- --------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE>
Item 5. OTHER EVENTS
On February 15, 2000 the Registrant issued the press release
attached as Exhibit 99.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Exhibits
99.1 Press Release dated February 15, 2000.
2
<PAGE>
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.
WesterFed Financial Corporation
Date: February 15, 2000 By: /s/ Ralph K. Holliday
----------------- ---------------------------------
Ralph K. Holliday
President/Chief Executive Officer
3
<PAGE>
EXHIBIT 99
WESTERFED FINANCIAL CORPORATION ANNOUNCES
QUARTERLY AND FISCAL YEAR EARNINGS
RECORD QUARTERLY EARNINGS PER SHARE
STOCK BUY BACK PROGRAM
BRANCH CLOSURES
ANNUAL MEETING DATE
Missoula, Montana - February 15, 2000 - WesterFed Financial Corporation
(the "Company") (NASDAQ -WSTR), the holding company for Western Security Bank
(the "Bank"), announced earnings for the quarter ended December 31, 1999 of $2.0
million, or a record $0.45 per share (cash earnings of $0.53 per share), as
compared to $1.8 million, or $0.33 per share (cash earnings of $0.40 per share)
for the same period last year. Earnings for the six month period ended December
31, 1999 were $4.0 million, or $0.89 per share (cash earnings of $1.05 per
share), as compared to $3.6 million, or $0.64 per share (cash earnings of $0.79
per share), for the same period last year. Cash earnings, which represent the
amount by which tangible equity changes each period due to operating results,
include reported earnings plus the non-cash charges for goodwill amortization
and amortization relating to core deposit intangible and certain employee stock
plans and related tax benefit. On November 4, 1999 the Company announced that it
was changing the Company's fiscal year end to December 31, 1999 from a fiscal
year end of June 30.
The Board of Directors of the Company has also authorized a plan to
repurchase up to an additional 7.5% of its outstanding shares of common stock in
the open market during a twelve month period depending upon market conditions.
The program will be conducted through the use of certain registered
broker-dealers with repurchases to be made from time-to-time at prevailing
market prices. On December 31, 1999 there were 4,351,404 shares of common stock
outstanding. The Company had previously announced a 5% stock repurchase of the
then outstanding 4,538,557 shares. On December 31, 1999 substantially all of
those shares have been repurchased.
The annual Meeting of Stockholders will be held at 9:00 a.m. on April
25, 2000 at the Missoula Southgate Branch of Western Security Bank located at
2601 Garfield Street, Missoula, Montana.
The Company also announced that it intends to close two branches in the
Missoula, Montana market and consolidate the facilities into existing facilities
or a new facility that is currently under construction. The branch at 2230
Brooks Street will be consolidated into the Western Security branch six blocks
away at 2601 Garfield near Southgate Mall. The branch at 1610 South 3rd West
will be closed and customer accounts will be consolidated at either the 2601
Garfield branch or the new facility at 3045 North Reserve Street that is
expected to be completed June 1, 2000. Both the Garfield and Reserve Street
facilities are within three miles from the 1610 South 3rd West branch that is
closing. The 2230 Brooks Street facility is scheduled to close May 12, 2000 and
the 1610 South 3rd West branch June 15, 2000.
WesterFed President Ralph Holliday stated, "I am again pleased to
announce that the Company is reporting its second consecutive quarter of record
earnings per share. The $0.45 per share for the quarter ended December 31, 1999
is a 36.4% increase over the $0.33 per share reported for the same period last
year and the $0.89 per share for the six month period ended December 31, 1999 is
a 39.1% increase over the $0.64 per share reported for the same period last
year. We have been aggressively attempting to improve on the Company's
efficiency ratio, (the ratio of non-interest expense to net interest income and
non-interest income) which was 64.34% for the quarter ended December 31, 1999 as
compared to 67.55% for the same period last year, a 4.8% reduction. The
efficiency ratio for the fiscal year ended June 30, 1999 was 69.1%. The
efficiency ratio without intangibles amortization decreased to 61.00% for the
quarter ended December 31, 1999 as compared to 63.94% for the same period last
year, a 4.6% reduction. The efficiency ratio without intangibles amortization
for the fiscal year ended June 30, 1999 was 65.6%. Because the increasing
interest rate environment has resulted in lower fee income as loan refinance
activity has slowed we must continue to be diligent in our efforts to improve on
our efficiency ratio until this trend is reversed. In addition, because of our
stock repurchase programs and earnings, our return on equity has increased 32.0%
to 8.75% at December 31, 1999 as compared to 6.63% at December 31, 1998."
Holliday further stated, " On November 18, 1999 we announced the sale
of six branches with deposits of $57.0 million located in Glasgow, Hardin,
Malta, Miles City, Plentywood and Sidney to Stockman Bank of Montana. The
<PAGE>
geographic location of those branches made it increasingly difficult to provide
the level of service those customers are entitled to today and in the future.
The announced closing of the two branch facilities in Missoula continues our
efforts to provide excellent customer service in a cost efficient manner.
Customers will have only a short distance to travel to larger and more efficient
facilities that offer a wider choice of products and lending services that our
customers have come to expect. In addition, I am pleased that the Bank
successfully entered the Year 2000 without any computer related problems.
Finally, we have introduced our own bank web site at
"www.westernsecuritybank.com". We look forward to providing Internet Banking
services to our customers in the near future."
Total assets decreased $6.4 million to $1.001 billion at December 31,
1999 as compared to $1.007 billion at June 30, 1999. Loans receivable and loans
available-for-sale decreased $10.6 million and other non-earning assets
decreased $8.5 million while investment securities, Federal Home Loan Bank stock
and all other interest earning assets increased $5.5 million and mortgage-backed
securities increased $7.2 million. The $10.6 million decrease in loans
receivable and loans available-for-sale is primarily the result of a $20.9
million decrease in residential loans and a $12.0 million decrease in dealer
finance loans, while commercial and agriculture loans increased $12.6 million
and other consumer related loans increased $9.7 million. Total deposits
increased $12.9 million as a result of money market, checking accounts and
certificates of deposit increasing $15.6 million while savings accounts
decreased $2.7 million. Stockholders' equity decreased $1.6 million to $89.5
million due primarily to the repurchase of 219,000 shares of common stock for a
total of $3.7 million and the payment of dividends totaling $1.3 million,
partially offset by earnings of $4.0 million.
Net income increased $138,000 to $2.0 million for the quarter ended
December 31, 1999 from $1.8 million for the same period last year . Net interest
income before provision for loan losses for the quarter ended December 31, 1999
increased $164,000 to $8.1 million as compared to $8.0 million over the same
period last year. The provision for loan losses increased $165,000 to $435,000
during the quarter ended December 31, 1999 from $270,000 during the same period
last year. These provisions were required to maintain the allowance for loan
losses at a level which is considered adequate to absorb losses inherent in the
loan portfolio, especially related to charge-offs incurred with dealer finance
loans and other consumer related loans. Total non-interest income decreased
$419,000 to $2.0 million during the quarter ended December 31, 1999 from $2.4
million during the same period last year. Loan origination fees and gain on sale
of loans available-for-sale decreased $501,000 while service fees increased
$71,000. The decrease in loan related fees was the result of an increase in
interest rates during the end of 1999 as compared to a mostly declining interest
rate environment during the end of 1998 which resulted in lower volumes of
refinance activity on residential loans during the quarter ended December 31,
1999 as compared to the same period last year. Non-interest expenses decreased
$497,000, or 7.1%, to $6.5 million for the quarter ended December 31, 1999 from
$7.0 million for the same period last year.
Net income increased $392,000 to $4.0 million for the six month period
year ended December 31, 1999 as compared to $3.6 million for the same period
last year. The $392,000 increase in net income was comprised primarily of an
increase in net interest income of $403,000 and a $944,000 decrease in
non-interest expense, partially offset by a $370,000 increase in provision for
loan losses and a decrease in non-interest income of $577,000. The interest rate
spread decreased to 3.10% at December 31, 1999 from 3.16% at June 30, 1999 and
3.21% at December 31, 1998.
Interest income decreased $642,000 to $35.6 million for the six month
period ended December 31, 1999 from $36.2 million for the same period last year.
This decrease was primarily the result of a decrease in the average yield on
interest-earning assets to 7.68% during six month period ended December 31, 1999
from 7.92% during the same period last year.
Interest expense decreased $1.0 million to $19.4 million for the six
month period ended December 31, 1999 from $20.4 million for the same period last
year. This decrease was primarily the result of a decrease in the average rate
paid on interest-bearing liabilities to 4.33% during six month period ended from
4.71% during the six month period ended December 31, 1998.
The provision for loan losses increased $370,000 to $880,000 for the
six month period ended December 31, 1999 from $510,000 for the same period last
year. The increased provision for loan losses is primarily related to dealer
<PAGE>
finance and other consumer loans. At December 31, 1999, the Company had $3.1
million of non-performing assets (representing 0.31% of total assets) compared
to $4.2 million at June 30, 1999 (representing 0.42% of total assets). The 0.31%
is substantially less than the national composite for thrifts of 0.65% at
September 30, 1999, which is the latest available information reported by the
Office of Thrift Supervision. At December 31, 1999, the Company had allowance
for loan losses to non-performing assets of 165.4% as compared to 121.1% at June
30, 1999. Management's evaluation of the adequacy of its loan loss reserves, the
quality of the loan portfolio and economic conditions in Montana resulted in the
$880,000 provision for loan losses. Future additions to the Company's allowance
for loan losses and any change in the related ratio of the allowance for loan
losses to non-performing loans are dependent upon the performance and
composition of the Company's loan portfolio, the economy, inflation, changes in
real estate values and interest rates and the view of the regulatory authorities
toward adequate reserve levels.
Non-interest income decreased $577,000 to $4.1 million during the six
month period ended December 31, 1999 from $4.7 million during the same period
last year. The $577,000 decrease resulted primarily from decreases in loan
origination fees and net gain on sale of loans and securities available-for-sale
of $776,000, while service fees increased $208,000. The increasing interest rate
environment that existed during the six month period ended December 31, 1999
reduced loan refinance activity, resulting in a decrease in loans sold to $41.6
million during the six month period ended December 31, 1999 as compared to $66.6
million during the same period last year. Seasonal fluctuations in loan volume
and a decline in loan volume due to increased interest rates could continue to
adversely affect origination fees and gains on sale of loans available-for-
sale.
Non-interest expense decreased $944,000 or 6.8%, to $13.0 million
during the six month period ended December 31, 1999 from $14.0 million during
the same period last year. Compensation and employee benefits , equipment and
furnishings expense and other expenses decreased $436,000, $110,000 and $339,000
respectively while marketing and advertising increased $102,000.
FORWARD LOOKING STATEMENTS
When used in this press release or other public shareholder
communications, or in oral statements made with the approval of an authorized
executive officer, the words or phrases "will likely result," "are expected to,"
"will continue," "is anticipated," "estimate," "project," "significantly" or
similar expressions are intended to identify "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995. The Company
wishes to caution readers not to place undue reliance on any forward-looking
statements, which speak only as of the date made, and to advise readers that
various factors including regional and national economic conditions, changes in
levels of market interest rates, credit risks of lending activities ,
competitive and regulatory factors could affect the Bank's financial performance
and could cause the Company's actual results for future periods to differ
materially from those anticipated or projected.
The Company does not undertake, and specifically disclaims, any
obligation to publicly release the result of any revisions which may be made to
any forward-looking statements to reflect the occurrence of anticipated or
unanticipated events or circumstances after the date of such statements.
WesterFed Financial Corporation's only subsidiary, Western Security
Bank, which is Montana's largest savings bank, operates thirty-four offices in
twenty Montana communities.
CONTACT: James A. Salisbury, Executive Vice President/Treasurer
and Chief Financial Officer
(406) 721-5254
<PAGE>
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEETS
WESTERFED FINANCIAL CORPORATION AND SUBSIDIARIES
(Dollars in thousands, except share and per share data)
December 31, 1999 June 30, 1999
----------------- -------------
<S> <C> <C>
ASSETS
Cash and due from banks $ 20,233 $ 25,867
Interest-bearing due from banks 5,910 3,079
------------ -----------
Cash and cash equivalents 26,143 28,946
Interest-bearing deposits 100 1,985
Investment securities available-for-sale 106,212 103,441
Investment securities, at amortized cost (estimated fair value
of $9,295 at December 31, 1999 and $9,255 at June 30, 1999) 9,205 9,235
Stock in Federal Home Loan Bank of Seattle, at cost 15,154 14,615
Mortgage-backed securities available-for-sale 81,276 68,029
Mortgage-backed securities, at amortized cost
(estimated fair value of $77,926 at
December 31, 1999 and $85,252 at June 30, 1999)
77,672 83,720
Loans available-for-sale 4,470 3,740
Loans receivable, net 616,281 627,631
Interest receivable 7,492 7,635
Premises and equipment, net 27,477 28,269
Core deposit intangible 3,401 3,741
Goodwill 14,763 15,096
Cash surrender value of life insurance policies 8,164 6,916
Other assets 3,075 4,350
------------ -----------
Total assets $ 1,000,885 $ 1,007,349
============ ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits $ 658,404 $ 645,549
Repurchase agreements 7,731 6,702
Borrowed funds 227,078 244,483
Advances from borrowers for taxes and insurance 3,296 3,302
Income taxes - current and deferred 597 1,552
Accrued interest payable 6,476 6,156
Accrued expenses and other liabilities 7,778 8,456
------------ -----------
Total liabilities 911,360 916,200
------------ -----------
Stockholders' Equity:
Preferred stock, $.01 par value, 5,000,000 shares authorized;
none outstanding -- --
Common stock, $.01 par value, 10,000,000 shares authorized;
4,351,404 shares outstanding at December 31, 1999, and
4,538,557 outstanding at June 30, 1999 44 56
Paid-in capital 70,040 69,572
Common stock acquired by ESOP/RRP (2,090) (2,216)
Treasury stock, at cost (28,962) (25,319)
Accumulated other comprehensive loss (2,930) (1,717)
Retained earnings 53,423 50,773
------------ -----------
Total stockholders' equity 89,525 91,149
------------ -----------
Total liabilities and stockholders' equity $ 1,000,885 $ 1,007,349
============ ===========
Book value per common share outstanding $20.57 $20.08
====== ======
Tangible book value per common share outstanding $16.40 $15.93
====== ======
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF INCOME WESTERFED FINANCIAL CORPORATION AND
SUBSIDIARIES (Dollars in thousands, except share and per share data)
(Unaudited)
Three Months Ended Six Months Ended
December 31, December 31,
------------------------- ------------------------
<S> <C> <C> <C> <C>
1999 1998 1999 1998
--------- ------- -------- ---------
Interest income:
Loans receivable $13,030 $13,604 $25,980 $27,670
Mortgage-backed securities 2,646 1,860 5,270 3,920
Investment securities 2,019 2,011 4,004 4,137
Interest-bearing deposits 76 273 172 361
Other 90 80 180 160
--------- ------- -------- ---------
Total interest income 17,861 17,828 35,606 36,248
--------- ------- -------- ---------
Interest expense:
NOW and money market demand 1,012 792 1,947 1,673
Savings 552 578 1,097 1,223
Certificates of deposit 4,764 5,291 9,398 10,692
--------- ------- -------- ---------
6,328 6,661 12,442 13,588
Borrowed funds and repurchase agreements 3,406 3,204 6,943 6,842
--------- ------- -------- ---------
Total interest expense 9,734 9,865 19,385 20,430
--------- ------- -------- ---------
Net interest income 8,127 7,963 16,221 15,818
Provision for loan losses 435 270 880 510
--------- ------- -------- ---------
Net interest income after provision for loan losses 7,692 7,693 15,341 15,308
--------- ------- -------- ---------
Non-interest income:
Loan origination fees on loans sold 446 742 957 1,429
Service fees 1,251 1,180 2,600 2,392
Net gain on sale of loans available-for-sale 120 325 277 581
Net gain on sale of securities available-for-sale 9 -- 13 --
Other 132 130 280 302
--------- ------- -------- ---------
Total non-interest income 1,958 2,377 4,127 4,704
--------- ------- -------- ---------
Non-interest expenses:
Compensation and employee benefits 3,018 3,234 6,156 6,592
Net occupancy expense of premises 491 519 943 1,035
Equipment and furnishings 484 542 985 1,095
Data processing 412 402 820 815
Deposit insurance premium 86 83 170 171
Intangibles amortization 337 373 673 746
Marketing and advertising 295 219 475 373
Other 1,365 1,613 2,788 3,127
--------- ------- -------- ---------
Total non-interest expense 6,488 6,985 13,010 13,954
--------- ------- -------- ---------
Income before income taxes 3,162 3,085 6,458 6,058
Income taxes 1,195 1,256 2,483 2,475
--------- ------- -------- ---------
Net income $1,967 $1,829 $3,975 $3,583
========= ======= ======== =========
Net income per common share:
Basic $0.47 $0.35 $0.93 $0.67
========= ======= ======== =========
Diluted $0.45 $0.33 $0.89 $0.64
========= ======= ======== =========
Dividends per share $0.160 $0.140 $0.315 0$.275
========= ======= ======== =========
Dividend payout ratio - basic 34.04% 40.00% 33.87% 41.04%
========= ======= ======== =========
Average common and common equivalent shares outstanding:
Basic 4,227,313 5,294,511 4,291,092 5,332,611
========= ======= ======== =========
Diluted 4,400,922 5,565,944 4,461,361 5,620,681
========= ======= ======== =========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Selected Financial Ratios and Other Data:
(Unaudited)
Three Months Ended Six Months Ended
December 31, December 31,
--------------------- --------------------
1999 1998 1999 1998
--------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
Performance Ratios:
Return on assets (ratio of net income to average total assets) (1) 0.78% 0.74% 0.79% 0.72%
Return on equity (ratio of net income to average equity) (1) 8.70 6.97 8.75 6.63
Interest rate spread information:
Average during period 3.38 3.28 3.35 3.21
End of period 3.10 3.21 3.10 3.21
Net interest margin (1) (4) 3.52 3.51 3.50 3.45
Ratio of non-interest expense to average total assets (1) 2.59 2.82 2.58 2.79
Efficiency ratio (2) 64.34 67.55 63.94 67.99
Efficiency ratio without intangibles (3) 61.00 63.94 60.63 64.36
Asset Quality Ratios:
Non-performing assets to total assets, at end of period 0.31 0.47 0.31 0.47
Total allowance for loan losses to total non-performing
assets (5) 165.36 105.78 165.36 105.78
Capital Ratios:
Stockholders' equity to total assets, at end of period 8.94 9.34 8.94 9.34
Tangible stockholders' equity to tangible assets, at end of period 7.26 7.48 7.26 7.48
Ratio of average interest-earning assets to average
interest-bearing liabilities 103.42 105.12 103.59 105.60
<FN>
(1) Annualized
(2) Ratio of non-interest expense to net interest income and non-interest
income
(3) Ratio of non-interest expense without intangibles to net interest
income and non-interest income
(4) Net interest income divided by average interest-earning assets
(5) Includes non-performing and foreclosed assets
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
WESTERFED FINANCIAL CORP
(Unaudited)
Three Months Ended
--------------------------------------------------------------
DECEMBER 31, 1999 DECEMBER 31, 1998
------------------------------ -------------------------------
Average Interest Average Interest
Outstanding Earned/ Yield/ Outstanding Earned/ Yield/
Balance (5) Paid Rate Balance (5) Paid Rate
------------ ------- --------- ------------ --------- --------
(Dollars in Thousands)
<S> <C> <C> <C> <C> <C> <C>
INTEREST EARNING ASSETS:
Loans receivable (1) (2) $621,395 $13,030 8.39% $642,972 $13,604 8.46%
Mortgage-backed securities (2) 159,782 2,646 6.62% 112,678 1,860 6.60%
Investments (2) 129,144 2,019 6.25% 124,358 2,011 6.47%
Other interest-earning assets (3) 4,007 76 7.59% 21,241 273 5.14%
Cash surrender value of life insurance 7,973 90 4.52% 6,824 80 4.69%
-------- ------- ---- ------- ------- ----
Total Interest-Earning Assets 922,301 17,861 7.75% 908,073 17,828 7.85%
======== ======= ==== ======= ======= ====
INTEREST-BEARING LIABILITIES:
Certificates of deposits 368,510 4,764 5.17% 376,463 5,291 5.62%
Savings accounts 88,831 552 2.49% 90,831 578 2.55%
Demand and now accounts 119,819 203 0.68% 116,539 205 0.70%
Money market accounts 79,412 809 4.07% 60,763 587 3.86%
-------- ------- ---- ------- ------- ----
Total deposits 656,572 6,328 3.86% 644,596 6,661 4.13%
FHLB advances and other borrowed money 235,199 3,406 5.79% 219,277 3,204 5.84%
-------- ------- ---- ------- ------- ----
Total Interest-Bearing Liabilities 891,771 9,734 4.37% 863,873 9,865 4.57%
======== ======= ==== ======= ======= ====
Net interest income $ 8,127 $ 7,963
======= =======
Net interest rate spread 3.38% 3.28%
==== ====
Net interest earning assets $ 30,530 $ 44,200
======== ========
Net interest margin (4) 3.52% 3.51%
==== ====
Average interest-earning assets to average
interest-bearing liabilities 103.42% 105.12%
====== ======
</TABLE>
<TABLE>
<CAPTION>
WESTERFED FINANCIAL CORP
Six Months Ended
--------------------------------------------------------------
DECEMBER 31, 1999 DECEMBER 31, 1998
------------------------------ -------------------------------
Average Interest Average Interest
Outstanding Earned/ Yield/ Outstanding Earned/ Yield/
Balance (5) Paid Rate Balance (5) Paid Rate
------------ ------- --------- ------------ --------- --------
(Dollars in Thousands)
<S> <C> <C> <C> <C> <C> <C>
INTEREST EARNING ASSETS:
Loans receivable (1) (2) $624,230 $25,980 8.32% $650,235 $27,670 8.51%
Mortgage-backed securities (2) 161,611 5,270 6.52% 116,978 3,920 6.70%
Investments (2) 128,731 4,004 6.22% 128,496 4,137 6.44%
Other interest-earning assets (3) 4,926 172 6.98% 13,163 361 5.49%
Cash surrender value of life insurance 7,752 180 4.64% 6,789 160 4.71%
-------- ------- ---- ------- ------- ----
Total Interest-Earning Assets 927,250 35,606 7.68% 915,661 36,248 7.92%
======== ======= ==== ======= ======= ====
INTEREST-BEARING LIABILITIES:
Certificates of deposits 364,503 9,398 5.16% 377,251 10,692 5.67%
Savings accounts 89,566 1,097 2.45% 91,179 1,223 2.68%
Demand and now accounts 118,364 401 0.68% 112,876 491 0.87%
Money market accounts 77,405 1,546 3.99% 59,213 1,182 3.99%
-------- ------- ---- ------- ------- ----
Total deposits 649,838 12,442 3.83% 640,519 13,588 4.24%
FHLB advances and other borrowed money 245,249 6,943 5.66% 226,623 6,842 6.04%
-------- ------- ---- -------- ------- ----
Total Interest-Bearing Liabilities 895,087 19,385 4.33% 867,142 20,430 4.71%
======== ======= ==== ======= ======= ====
Net interest income $16,221 $15,818
======= =======
Net interest rate spread 3.35% 3.21%
==== ====
Net interest earning assets $ 32,163 $ 48,519
======== ========
Net interest margin (4) 3.50% 3.45%
==== ====
Average interest-earning assets to average
interest-bearing liabilities 103.59% 105.60%
====== ======
<FN>
(1) Calculated net of deferred loan fees, loan discounts, loans in process
and loss reserves
(2) Includes held and available for sale categories
(3) Includes primarily short term liquid assets
(4) Net interest income divided by average interest earning assets
(5) Based on average monthly balances
</FN>
</TABLE>
<PAGE>
WESTERFED FINANCIAL CORPORATION
Non-Performing Assets
December 31 June 30,
1999 1999
----------- --------
(In Thousands)
Non-accruing loans:
Real Estate:
One-to-four family $ 549 $ 521
Multi-family - -
Nonresidential property (except land) 348 -
Land - -
Construction 324 112
Agriculture 1,113 1,098
Commercial - non real estate 51 106
Consumer 508 1,212
------ ------
Total 2,893 3,049
------ ------
Accruing loans delinquent 90 days or more:
Real Estate:
One-to-four family 40 426
Multi-family - -
Nonresidential property (except land) - -
Construction - 344
Agriculture - -
Commercial - non real estate - -
Consumer 20 5
------ ------
Total 60 775
------ ------
Foreclosed assets:
Real Estate:
One-to-four family 94 238
Multi-family - -
Commercial - -
Land 26 26
Construction - -
Consumer 48 106
------ ------
Total 168 370
------ ------
Total non-performing assets $3,121 $4,194
====== ======
<PAGE>
<TABLE>
<CAPTION>
WESTERFED FINANCIAL CORPORATION
Allowance for Loan Losses
(Unaudited)
For the Three Month For the Six Month
Period Ended Period Ended
December 31, December 31,
------------------ ------------------
1999 1998 1999 1998
------ ------ ------ ------
(In Thousands) (In Thousands)
<S> <C> <C> <C> <C>
Balance at beginning of period $5,300 $4,880 $5,079 $4,907
Charge-Offs:
Real Estate:
One- to four-family (23) (130) (27) (130)
Commercial -- -- -- --
Other:
Commercial (116) (45) (161) (48)
Consumer (587) (152) (798) (438)
------ ------ ------ ------
Total charge-offs (726) (327) (986) (616)
------ ------ ------ ------
Recoveries:
Other:
Commercial 2 -- 2 --
Consumer 150 23 186 45
------ ------ ------ ------
Total recoveries 152 23 188 45
------ ------ ------ ------
Net charge-offs (574) (304) (798) (571)
Provisions charged to operations 435 270 880 510
------ ------ ------ ------
Balance at end of period $5,161 $4,846 $5,161 $4,846
====== ====== ====== ======
Ratio of net charge-offs during the period to
average loans outstanding during the period 0.09% 0.05% 0.13% 0.09%
===== ===== ===== =====
Ratio of net charge-offs during the period to
average non-performing assets during the
period 15.87% 6.23% 22.06% 11.70%
===== ===== ===== =====
Ratio of allowance for loan losses to net loans
before allowance 0.82% 0.75% 0.82% 0.75%
===== ===== ===== =====
</TABLE>
