Wells Financial Corp. Announces Annual Results WELLS, Minn., March
10 /PRNewswire-FirstCall/ -- Selected Financial Data Year ended
Year ended 12/31/04 12/31/03 Net Income $2,164,000 $3,540,000 Basic
earnings per share $1.87 $3.12 Diluted earnings per share $1.83
$3.05 Return on average equity 7.64% 13.30% Return on average
assets 0.95% 1.58% Book value per share $24.58 $24.15 Net interest
rate spread 3.75% 3.16% Net interest rate margin 3.92% 3.33%
Allowance for loan loss to total loans 0.44% 0.56% Lonnie R.
Trasamar, President of Wells Financial Corp. (the Company), the
holding company of Wells Federal Bank (the Bank), announced
earnings for 2004 of $2,164,000, down $1,376,000 or 38.9% when
compared to 2003. Basic and diluted earnings per share for 2004
were $1.87 and $1.83, respectively. This compares to basic and
diluted earnings per share of $3.12 and $3.05, respectively, for
2003. The decrease in net income for 2004 when compared to 2003 was
primarily the result of a decrease of $4,192,000 in the gain on
sale of loans originated for sale. During 2004 fewer mortgage loans
were originated for sale when compared to 2003 resulting in a
decrease in the gain on sale of loans originated for sale.
Partially offsetting the decrease in gain on sale of loans
originated for sale was an increase of $1,468,000 in net interest
income. Total assets increased by $15,590,000 during 2004 due
primarily to an increase of $45,613,000 in loans receivable. The
increase in loans receivable resulted primarily from increases in
commercial and agricultural real estate loans. Cash and securities
available for sale decreased by $19,713,000 and $13,465,000,
respectively. Liabilities increased by $16,868,000 during 2004 due
to a $18,640,000 increase in borrowed funds being partially offset
by a $2,167,000 decrease in deposits. Wells Financial Corp. and
Wells Federal Bank are headquartered in Wells, Minnesota. The Bank
operates nine full service offices located in Wells, Blue Earth,
Mankato, Fairmont, North Mankato, Albert Lea, St. Peter and
Owatonna Minnesota and Mason City, Iowa and a loan origination
office located in Farmington, Minnesota. The Bank is a community
oriented, full service savings bank offering traditional mortgage,
consumer, commercial and agricultural loan products. The Bank
offers insurance, mutual funds and variable rate annuity products
through its subsidiary, Wells Insurance Agency. Forward-looking
Statements Statements in this press release that are not strictly
historical may be "forward-looking" statements, which involve risks
and uncertainties. The foregoing material may contain
forward-looking statements concerning the financial condition,
results of operations and business of the Company. We caution that
such statements are subject to a number of uncertainties and actual
results could differ materially and, therefore, readers should not
place undue reliance on any forward-looking statements. The Company
does not undertake, and specifically disclaims, any obligation to
publicly release the results of any revisions that may be made to
any forward-looking statements to reflect the occurrence of
anticipated or unanticipated events or circumstances arising after
the date hereof. Consolidated Statements of Financial Condition
December 31, 2004 and 2003 (dollars in thousands) Assets 2004 2003
Cash, including interest-bearing accounts 2004 $1,383; 2003 $17,655
$5,605 $25,318 Certificates of deposit 100 200 Securities available
for sale 13,945 27,410 Federal Home Loan Bank Stock, at cost 2,133
1,303 Loans held for sale 3,454 1,997 Loans receivable, net of
allowance for loan losses of $924 in 2004 and $904 in 2003 205,662
160,049 Accrued interest receivable 1,533 1,209 Premises and
equipment 4,212 3,585 Mortgage servicing rights, net 2,515 2,681
Other assets 236 53 Total assets $239,395 $223,805 Liabilities and
Stockholders' Equity Liabilities Deposits $167,495 $169,662
Borrowed funds 41,640 23,000 Advances from borrowers for taxes and
insurance 1,877 1,585 Deferred income taxes 1,494 1,456 Accrued
interest payable 38 34 Accrued expenses and other liabilities 261
200 Total liabilities 212,805 195,937 Stockholders' Equity
Preferred stock, no par value; 500,000 shares authorized; none
outstanding - - Common stock, $.10 par value; 7,000,000 shares
authorized; 2,187,500 shares issued 219 219 Additional paid-in
capital 17,177 17,154 Retained earnings, substantially restricted
28,063 26,922 Accumulated other comprehensive income 600 525
Unearned Employee Stock Ownership Plan shares - - Unearned
compensation-restricted stock awards (329) (561) Less cost of
treasury stock, 2004 1,105,852 shares; 2003 1,033,673 shares
(19,140) (16,391) Total stockholders' equity 26,590 27,868 Total
liabilities and stockholders' equity $239,395 $223,805 Consolidated
Statements of Income Years Ended December 31, 2004 and 2003
(dollars in thousands, except per share data) 2004 2003 Interest
and Dividend Income Loans receivable: First mortgage loans $7,036
$7,447 Consumer and other loans 4,569 2,848 Investment securities
and interest-bearing deposits 797 1,219 Total interest income
12,402 11,514 Interest Expense Deposits 2,609 3,350 Borrowed funds
1,406 1,245 Total interest expense 4,015 4,595 Net interest income
8,387 6,919 Provision for loan losses 120 - Net interest income
after provision for loan losses 8,267 6,919 Noninterest Income Gain
on sale of loans originated for sale 1,421 5,090 Loan servicing
fees 962 947 Insurance commissions 643 459 Fees and service charges
621 1,058 Other 98 196 Total noninterest income 3,745 7,750
Noninterest Expenses Compensation and benefits 4,393 4,159
Occupancy 1,070 1,153 Data processing 652 471 Advertising 331 293
Amortization and valuation adjustments for mortgage servicing
rights 656 1,071 Other 1,525 1,752 Total noninterest expenses 8,627
8,899 Income before income taxes 3,385 5,770 Income tax expense
1,221 2,230 Net income $2,164 $3,540 Cash dividends declared per
share $0.88 $0.80 Earnings per share Basic $1.87 $3.12 Diluted
$1.83 $3.05 DATASOURCE: Wells Financial Corp. CONTACT: Lonnie R.
Trasamar of Wells Financial Corp., +1-507-553-3151
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