Waterstone earnings down on lower loan margins

Wauwatosa-based Waterstone Financial Inc. reported fourth quarter net income of $1.9 million, or 6 cents per share, down from $18.1 million, or 53 cents per share, in the fourth quarter of 2012.

For the full year, the WaterStone Bank parent company reported net income was $14.7 million, or 43 cents per share, down from $34.9 million, or $1.02 per share, in 2012.

The company reported lower loan margins, which resulted in a 3.5 percent decrease in total mortgage banking revenue for the year.
It also attributed a recent subscription offering, with $388.7 million in proceeds, to the declines.

Nonperforming assets as a percentage of total assets declined from 6.6 percent in 2012 to 3.78 percent in 2013. Delinquent loans were down 40.9 percent, to $44 million.

“Financial performance for 2013 reflects continued asset quality improvement for the community banking segment partially offset by reduced profitability for the mortgage banking segment,” said Doug Gordon, president and chief executive officer of the company. “In addition, Waterstone Financial, Inc. completed its second-step conversion in January of 2014 which resulted in our becoming a stock holding company with a gross capital raise of $253 million. Strong participation in the capital raise by WaterStone Bank depositors is gratifying and will enable us to execute growth strategies to further improve profitability and franchise value.”

The company has $1.9 billion in assets as of December 31. The bank has nine branches in the area and loan and mortgage banking offices nationwide.

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