Press Release

Provident Financial Holdings Reports Third Quarter of Fiscal 2020 Results

Company Release - 4/28/2020 6:00 AM ET

Company Reports $1.14 Million of Net Income in the March 2020 Quarter in Comparison to the $151,000 Net Loss in the March 2019 Quarter

Non-Interest Expense Declines by 42% in the March 2020 Quarter in Comparison to the March 2019 Quarter

Loans Held for Investment Increase 4% to $914.3 Million from June 30, 2019

Non-Performing Assets Decrease 42% to $3.6 Million at March 31, 2020 in Comparison to $6.2 Million at June 30, 2019

RIVERSIDE, Calif., April 28, 2020 (GLOBE NEWSWIRE) -- Provident Financial Holdings, Inc. (“Company”), NASDAQ GS: PROV, the holding company for Provident Savings Bank, F.S.B. (“Bank”), today announced third quarter earnings results for the fiscal year ending June 30, 2020.

For the quarter ended March 31, 2020, the Company reported net income of $1.14 million, or $0.15 per diluted share (on 7.60 million average diluted shares outstanding), in contrast to the net loss of $151,000, or $(0.02) per diluted share (on 7.51 million average diluted shares outstanding), in the comparable period a year ago. Compared to the same quarter last year, the increase in earnings was primarily attributable to lower non-interest expenses (mainly, lower salaries and employee benefits expenses related to fewer employees resulting from the scaling back of saleable single-family loan originations), partly offset by lower non-interest income (mainly, lower gain on sale of loans), a higher provision for loan losses and lower net interest income.

“Like all companies, we began to see the early implications of the COVID-19 pandemic in the March 2020 quarter. As a result, we increased our provision for loan losses, we tightened our underwriting criteria for new loan originations and purchases, and we began developing programs to help those customers who may be impacted by this event,” said Craig G. Blunden, Chairman and Chief Executive Officer of the Company. “Nonetheless, we remain profitable, strongly capitalized and well-positioned to serve the communities of the Inland Empire,” said Mr. Blunden.

Mr. Blunden went on to say, “We have suspended foreclosure sales, offered late fee waivers and implemented a payment forbearance plan, among other actions. Our branches are open and operating with normal branch hours. We’ve implemented social distancing recommendations, sanitizing and cleaning procedures, and are generally operating under state, county, and city recommendations for essential service providers.”

“Provident plays an important role in the Inland Empire and I specifically wish to recognize and thank our employees who are working diligently to support our customers and communities under difficult circumstances,” Mr. Blunden concluded.

Return on average assets for the third quarter of fiscal 2020 was 0.41 percent in contrast to (0.05) percent for the same period of fiscal 2019; and return on average stockholders’ equity for the third quarter of fiscal 2020 was 3.70 percent in contrast to (0.49) percent for the comparable period of fiscal 2019.

On a sequential quarter basis, the $1.14 million net income for the third quarter of fiscal 2020 reflects a $1.26 million or 52 percent decrease from $2.40 million in the second quarter of fiscal 2020. The decrease in earnings for the third quarter of fiscal 2020 compared to the second quarter of fiscal 2020 was primarily attributable to an $896,000 higher provision for loan losses, a $749,000 reduction in net interest income and a $243,000 decrease in non-interest income (mainly reflecting $236,000 of lower loan servicing and other fees). Diluted earnings per share for the third quarter of fiscal 2020 were $0.15 per share, down 52 percent from the $0.31 per share during the second quarter of fiscal 2020. Return on average assets was 0.41 percent for the third quarter of fiscal 2020 compared to 0.87 percent in the second quarter of fiscal 2020; and return on average stockholders’ equity for the third quarter of fiscal 2020 was 3.70 percent, compared to 7.81 percent for the second quarter of fiscal 2020.

For the nine months ended March 31, 2020 net income increased $2.48 million, or 68 percent, to $6.11 million from $3.63 million in the comparable period ended March 31, 2019; and diluted earnings per share for the nine months ended March 31, 2020 increased 67 percent to $0.80 per share (on 7.61 million average diluted shares outstanding) from $0.48 per share (on 7.56 million average diluted shares outstanding) for the comparable nine month period last year. Compared to the same period last year, the increase in earnings was primarily attributable to a $13.28 million decrease in non-interest expense; partly offset by a $7.68 million decrease in non-interest income (mainly, a $7.23 million decrease in the gain on sale of loans) and a $1.12 million change in the provision for loan losses to a $671,000 provision from a $450,000 recovery. The decrease in non-interest expense was mainly attributable to a $9.80 million decrease in salaries and employee benefits expenses (primarily related to fewer employees resulting from the scaling back of saleable single-family loan originations) and a $1.30 million decrease in premises and occupancy expenses.

Net interest income decreased $722,000, or eight percent, to $8.89 million in the third quarter of fiscal 2020 from $9.61 million for the same quarter of fiscal 2019, attributable to a decrease in the net interest margin, and to a lesser extent, a lower average interest-earning assets balance. The net interest margin during the third quarter of fiscal 2020 decreased 23 basis points to 3.30 percent from 3.53 percent in the same quarter last year, primarily due to a decrease in the average yield of interest-earning assets and a slight increase in the average cost of interest-bearing liabilities. The average yield on interest-earning assets decreased by 22 basis points to 3.87 percent in the third quarter of fiscal 2020 from 4.09 percent in the same quarter last year reflecting in part recent significant decreases in the targeted Federal Funds Rate in response to the COVID-19 pandemic; while the average cost of interest-bearing liabilities increased by one basis point to 0.64 percent in the third quarter of fiscal 2020 from 0.63 percent in the same quarter last year. The average balance of interest-earning assets decreased by $11.3 million, or one percent, to $1.08 billion in the third quarter of fiscal 2020 from $1.09 billion in the same quarter last year. The average balance of interest-bearing liabilities decreased by $11.1 million, or one percent, to $967.9 million in the third quarter of fiscal 2020 from $979.0 million in the same quarter last year.

The average balance of loans receivable (including loans held for sale in the prior year) increased by $14.5 million, or two percent, to $929.5 million in the third quarter of fiscal 2020 from $915.0 million in the same quarter of fiscal 2019, primarily due to an increase in loans held for investment, partly offset by a decrease in loans held for sale. There were no loans held for sale during the third quarter of fiscal 2020. The average yield on loans receivable decreased by 24 basis points to 4.14 percent in the third quarter of fiscal 2020 from an average yield of 4.38 percent in the same quarter of fiscal 2019. Net deferred loan cost amortization in the third quarter of fiscal 2020 increased 152% to $451,000 from $179,000 in the same quarter of fiscal 2019 due primarily to higher loan payoffs. Total loans originated and purchased for investment in the third quarter of fiscal 2020 were $28.8 million, down 35 percent from $44.0 million in the same quarter of fiscal 2019. Loan principal payments received in the third quarter of fiscal 2020 were $55.7 million, up 53 percent from $36.5 million in the same quarter of fiscal 2019.

The average balance of investment securities decreased by $23.3 million, or 23 percent, to $78.6 million in the third quarter of fiscal 2020 from $101.9 million in the same quarter of fiscal 2019. The average yield on investment securities increased 11 basis points to 2.43 percent in the third quarter of fiscal 2020 from 2.32 percent for the same quarter of fiscal 2019. The increase in the average yield was primarily attributable to a lower premium amortization ($99,000 vs. $181,000).

In the third quarter of fiscal 2020, the Federal Home Loan Bank – San Francisco (“FHLB”) distributed a $144,000 cash dividend to the Bank on its FHLB stock, unchanged from the same quarter last year.

The average balance of the Company’s interest-earning deposits, primarily cash with the Federal Reserve Bank of San Francisco, decreased $2.5 million, or four percent, to $61.9 million in the third quarter of fiscal 2020 from $64.4 million in the same quarter of fiscal 2019. The average yield earned on interest-earning deposits in the third quarter of fiscal 2020 was 1.20 percent, down 120 basis points from 2.40 percent in the same quarter of fiscal 2019 largely as a result of decreases in the targeted Federal Funds Rate since July 2019.

Average deposits decreased $36.4 million, or four percent, to $836.9 million in the third quarter of fiscal 2020 from $873.3 million in the same quarter of fiscal 2019, primarily due to a managed run-off of higher cost time deposits over the last year consistent with the reduction in the Bank’s funding needs resulting from no loans originated for sale during the first nine months of fiscal 2020. The average cost of deposits improved, decreasing by three basis points to 0.36 percent in the third quarter of fiscal 2020 from 0.39 percent in the same quarter last year.

Transaction account balances or “core deposits” increased slightly to $650.2 million at March 31, 2020 from $648.1 million at June 30, 2019, while time deposits decreased $7.5 million, or four percent, to $185.6 million at March 31, 2020 from $193.1 million at June 30, 2019.

The average balance of borrowings, which consisted of FHLB advances, increased $25.3 million, or 24 percent, to $131.1 million while the average cost of borrowings decreased 17 basis points to 2.44 percent in the third quarter of fiscal 2020, compared to an average balance of $105.8 million with an average cost of 2.61 percent in the same quarter of fiscal 2019. The increase in the average balance of borrowings was primarily due to new long-term borrowings with a lower average cost obtained during the first quarter of fiscal 2020.

During the third quarter of fiscal 2020, the Company recorded a provision for loan losses of $874,000, up from only $4,000 recorded during the same period of fiscal 2019 and up from the recovery of $22,000 recorded in the second quarter of fiscal 2020 (sequential quarter).The increase in the provision for loan losses was primarily due to a qualitative component established in our allowance for loan losses methodology in response to the COVID-19 pandemic which has negatively impacted the current economic environment.

Non-performing assets, with underlying collateral located in California, decreased $2.6 million, or 42 percent, to $3.6 million, or 0.33 percent of total assets, at March 31, 2020, compared to $6.2 million, or 0.57 percent of total assets, at June 30, 2019. The non-performing loans at March 31, 2020 are comprised of 16 single-family loans ($3.6 million) and one commercial business loan ($34,000). At both March 31, 2020 and June 30, 2019, there was no real estate owned.

Net loan recoveries for the quarter ended March 31, 2020 were $15,000 or 0.01 percent (annualized) of average loans receivable, similar to net loan recoveries of $15,000 or 0.01 percent (annualized) of average loans receivable for the quarter ended March 31, 2019 and net loan recoveries of $14,000 or 0.01 percent (annualized) of average loans receivable for the quarter ended December 31, 2019 (sequential quarter).

Classified assets at March 31, 2020 were $15.1 million, comprised of $11.4 million of loans in the special mention category, $3.7 million of loans in the substandard category and no real estate owned; while classified assets at June 30, 2019 were $16.2 million, comprised of $8.6 million of loans in the special mention category, $7.6 million of loans in the substandard category and no real estate owned.

For the quarter ended March 31, 2020, no new loans were restructured from their original terms and classified as restructured loans. The outstanding balance of restructured loans at March 31, 2020 was $1.8 million (six loans), down 53 percent from $3.8 million (eight loans) at June 30, 2019. As of March 31, 2020, all of the restructured loans were classified as substandard non-accrual. As of March 31, 2020, 39% or $683,000 of the restructured loans have a current payment status.

The allowance for loan losses was $7.8 million at March 31, 2020, or 0.85 percent of gross loans held for investment, compared to $7.1 million at June 30, 2019, or 0.80 percent of gross loans held for investment. Management believes that, based on currently available information, the allowance for loan losses is sufficient to absorb potential losses inherent in loans held for investment at March 31, 2020.

Non-interest income decreased by $1.95 million, or 64 percent, to $1.10 million in the third quarter of fiscal 2020 from $3.05 million in the same period of fiscal 2019, primarily as a result of no loan sales during the current quarter. The gain on sale of loans during the third quarter of fiscal 2019 was $1.72 million. On a sequential quarter basis, non-interest income decreased $243,000, or 18 percent, primarily as a result of a decrease in loan servicing and other loan fees. There were no loans originated for sale during the current or sequential quarters.

Non-interest expenses decreased $5.50 million, or 42 percent, to $7.50 million in the third quarter of fiscal 2020 from $13.00 million in the same quarter last year. The decrease was due primarily to lower salaries and employee benefits expenses resulting from fewer employees and lesser reductions in premises and occupancy and other non-interest expense consistent with the scaling back of saleable single-family mortgage loan originations. On a sequential quarter basis, non-interest expenses remained virtually unchanged, decreasing $49,000 or one percent from $7.55 million.

The Company’s efficiency ratio in the third quarter of fiscal 2020 was 75 percent, an improvement from 103 percent in the same quarter last year but an increase from 69 percent in the second quarter of fiscal 2020 (sequential quarter).

The Company’s provision for income tax was $467,000 for the third quarter of fiscal 2020 in contrast to an income tax benefit of $189,000 in the same quarter last year. The effective tax rate in the third quarter of fiscal 2020 was 28.97%. The Company believes that the tax provision recorded in the third quarter of fiscal 2020 reflects its current federal and state income tax obligations.

The Company repurchased 46,756 shares of its common stock during the quarter ended March 31, 2020 at an average cost of $18.95 per share. As of March 31, 2020, a total of 118,040 shares or 32 percent of the shares authorized for repurchase under the April 2018 stock repurchase plan were purchased at an average cost of $19.57 per share. The April 2018 stock repurchase plan expired on April 26, 2020.

The Bank currently operates 13 retail/business banking offices in Riverside County and San Bernardino County (Inland Empire).

The Company will host a conference call for institutional investors and bank analysts on Wednesday, April 29, 2020 at 9:00 a.m. (Pacific) to discuss its financial results. The conference call can be accessed by dialing 1-877-226-8216 and referencing access code number 8875397. An audio replay of the conference call will be available through Wednesday, May 6, 2020 by dialing 1-866-207-1041 and referencing access code number 7751893.

For more financial information about the Company please visit the website at www.myprovident.com and click on the “Investor Relations” section.

Safe-Harbor Statement

This press release contains statements that the Company believes are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to the Company’s financial condition, liquidity, results of operations, plans, objectives, future performance or business. You should not place undue reliance on these statements, as they are subject to risks and uncertainties. When considering these forward-looking statements, you should keep in mind these risks and uncertainties, as well as any cautionary statements the Company may make. Moreover, you should treat these statements as speaking only as of the date they are made and based only on information then actually known to the Company. There are a number of important factors that could cause future results to differ materially from historical performance and these forward-looking statements. Factors which could cause actual results to differ materially from the results anticipated or implied by our forward-looking statements include, but are not limited to the effect of the COVID-19 pandemic, including on Company’s credit quality and business operations, as well as its impact on general economic and financial market conditions and other uncertainties resulting from the COVID-19 pandemic, such as the extent and duration of the impact on public health, the U.S. and global economies, and consumer and corporate customers, including economic activity, employment levels and market liquidity; increased competitive pressures; changes in the interest rate environment; secondary market conditions for loans and our ability to originate for sale and sell loans in the secondary market; changes in general economic conditions and conditions within the securities markets including as a result of the COVID-19 pandemic; legislative and regulatory changes; and other factors described in the Company’s latest Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and other filings with the Securities and Exchange Commission (“SEC”) - which are available on our website at www.myprovident.com and on the SEC’s website at www.sec.gov. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements whether as a result of new information, future events or otherwise. These risks could cause our actual results for fiscal 2020 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of us and could negatively affect our operating and stock price performance.

Contacts:

Craig G. Blunden 
Chairman and 
Chief Executive Officer 

Donavon P. Ternes
President, Chief Operating Officer 
and Chief Financial Officer

(951) 686-606

PROVIDENT FINANCIAL HOLDINGS, INC.
Condensed Consolidated Statements of Financial Condition
(Unaudited –In Thousands, Except Share Information)

  March 31,  December 31,  September 30,  June 30,  March 31, 
  2020  2019  2019  2019  2019 
Assets          
Cash and cash equivalents$84,250 $48,233 $54,515 $70,632 $61,458 
Investment securities – held to maturity, at cost 

69,482
  

77,161
  

85,088
  

94,090
  

102,510
 
Investment securities - available for sale, at fair value 4,828  5,237  5,517  5,969  6,294 
Loans held for investment, net of allowance for loan losses of $7,810; $6,921; $6,929; $7,076 and $7,080, respectively; includes $3,835; $4,173; $4,386; $5,094 and $5,239 at fair value, respectively 914,307
  941,729
  924,314
  879,925
  883,554
 
Loans held for sale, at fair value -  -  -  -  30,500 
Accrued interest receivable 3,154  3,292  3,380  3,424  3,386 
FHLB – San Francisco stock 8,199  8,199  8,199  8,199  8,199 
Premises and equipment, net 10,606  10,967  11,215  8,226  8,395 
Prepaid expenses and other assets 12,741  12,569  13,068  14,385  15,099 
           
Total assets$1,107,567 $1,107,387 $1,105,296 $1,084,850 $1,119,395 
           
Liabilities and Stockholders’ Equity          
Liabilities:          
Non interest-bearing deposits$86,585 $85,846 $85,338 $90,184 $90,875 
Interest-bearing deposits 749,246  747,804  746,398  751,087  786,009 
Total deposits 835,831  833,650  831,736  841,271  876,884 
           
Borrowings 131,070  131,085  131,092  101,107  101,121 
Accounts payable, accrued interest and other liabilities 17,508  18,876  20,299  21,831  20,181 
Total liabilities 984,409  983,611  983,127  964,209  998,186 
           
Stockholders’ equity:          
Preferred stock, $.01 par value (2,000,000 shares authorized; none issued and outstanding)- - - - - 
Common stock, $.01 par value (40,000,000 shares authorized; 18,097,615; 18,097,615; 18,091,865; 18,081,365 and 18,064,365 shares issued, respectively; 7,436,315; 7,483,071; 7,479,682; 7,486,106 and 7,497,357 shares outstanding, respectively)181 181 181 181 181 
Additional paid-in capital 95,355  95,118  94,795  94,351  96,114 
Retained earnings 193,802  193,704  192,354  190,839  191,103 
Treasury stock at cost (10,661,300; 10,614,544; 10,612,183; 10,559,259 and 10,567,008 shares, respectively) (166,247) (165,360) (165,309) (164,891) (166,352)
Accumulated other comprehensive income, net of tax 67  133  148  161  163 
           
Total stockholders’ equity 123,158  123,776  122,169  120,641  121,209 
           
Total liabilities and stockholders’ equity$1,107,567 $1,107,387 $1,105,296 $1,084,850 $1,119,395 

PROVIDENT FINANCIAL HOLDINGS, INC.
Condensed Consolidated Statements of Operations
(Unaudited - In Thousands, Except Earnings Per Share)

 Quarter Ended
March 31,
 
 Nine Months Ended
March 31,

  2020   2019   2020   2019 
Interest income:           
Loans receivable, net$9,622  $10,011  $30,017  $30,516 
Investment securities 478   592   1,659   1,381 
FHLB – San Francisco stock 144   144   432   565 
Interest-earning deposits 186   386   621   1,111 
Total interest income 10,430   11,133   32,729   33,573 
            
Interest expense:           
Checking and money market deposits 106   102   333   327 
Savings deposits 131   139   396   437 
Time deposits 509   600   1,571   1,851 
Borrowings 794   680   2,318   2,158 
Total interest expense 1,540   1,521   4,618   4,773 
            
Net interest income 8,890   9,612   28,111   28,800 
Provision (recovery) for loan losses 874   4   671   (450)
Net interest income, after provision (recovery) for loan losses 8,016   9,608   27,440   29,250 
            
Non-interest income:           
Loan servicing and other fees 131   262   631   863 
Gain (loss) on sale of loans, net 14   1,719   (115)  7,114 
Deposit account fees 423   471   1,321   1,485 
Gain (loss) on sale and operations of real estate owned acquired in the settlement of loans -   2   -   (4)
Card and processing fees 360   373   1,121   1,163 
Other 173   225   557   575 
Total non-interest income 1,101   3,052   3,515   11,196 
            
Non-interest expense:           
Salaries and employee benefits 4,966   9,292   14,950   24,753 
Premises and occupancy 845   1,286   2,603   3,905 
Equipment 314   417   855   1,333 
Professional expenses 351   513   1,090   1,371 
Sales and marketing expenses 177   246   506   668 
Deposit insurance premiums and regulatory assessments 54   124   97   461 
Other 798   1,122   2,196   3,088 
Total non-interest expense 7,505   13,000   22,297   35,579 
            
Income (loss) before taxes 1,612   (340)  8,658   4,867 
Provision (benefit) for income taxes 467   (189)  2,553   1,237 
Net income (loss)$1,145  $(151) $6,105  $3,630 
            
Basic earnings (loss) per share$0.15  $ (0.02) $ 0.82  $ 0.49 
Diluted earnings (loss) per share$0.15  $ (0.02) $ 0.80  $ 0.48 
Cash dividends per share$0.14  $0.14  $ 0.42  $ 0.42 


PROVIDENT FINANCIAL HOLDINGS, INC.

Condensed Consolidated Statements of Operations – Sequential Quarters
(Unaudited – In Thousands, Except Share Information)

 Quarter Ended
 March 31,December 31, September 30, June 30,
 March 31,
 2020
2019 2019 2019
 2019
Interest income: 
Loans receivable, net$9,622 $10,320 $10,075 $9,576 $10,011 
Investment securities 478  567  614  661  592 
FHLB – San Francisco stock 144  145  143  142  144 
Interest-earning deposits 186  189  246  426  386 
Total interest income 10,430  11,221  11,078  10,805  11,133 
           
Interest expense:          
Checking and money market deposits 106  117  110  101  102 
Savings deposits 131  131  134  135  139 
Time deposits 509  530  532  530  600 
Borrowings 794  804  720  669  680 
Total interest expense 1,540  1,582  1,496  1,435  1,521 
           
Net interest income 8,890  9,639  9,582  9,370  9,612 
Provision (recovery) for loan losses 874  (22) (181) (25) 4 
Net interest income, after provision (recovery) for loan losses 8,016  9,661  9,763  9,395  9,608 
           
Non-interest income:          
Loan servicing and other fees 131  367  133  188  262 
Gain (loss) on sale of loans, net 14  (43) (86) 21  1,719 
Deposit account fees 423  451  447  443  471 
Gain on sale and operations of real estate owned acquired in the settlement of loans, net -  -  -  -  2 
Card and processing fees 360  371  390  405  373 
Other 173  198  186  258  225 
Total non-interest income 1,101  1,344  1,070  1,315  3,052 
           
Non-interest expense:          
Salaries and employee benefits 4,966  4,999  4,985  5,396  9,292 
Premises and occupancy 845  880  878  1,133  1,286 
Equipment 314  262  279  1,141  417 
Professional expenses 351  331  408  493  513 
Sales and marketing expenses 177  212  117  312  246 
Deposit insurance premiums and regulatory assessments 54  59  (16) 129  124 
Other 798  811  587  1,053  1,122 
Total non-interest expense 7,505  7,554  7,238  9,657  13,000 
           
Income (loss) before taxes 1,612  3,451  3,595  1,053  (340)
Provision (benefit) for income taxes 467  1,053  1,033  266  (189)
Net income (loss)$1,145 $2,398 $2,562 $787 $(151)
           
Basic earnings (loss) per share$ 0.15 $ 0.32 $ 0.34 $ 0.10 $ (0.02)
Diluted earnings (loss) per share$ 0.15 $ 0.31 $ 0.34 $ 0.10 $ (0.02)
Cash dividends per share $ 0.14 $ 0.14 $ 0.14 $ 0.14 $ 0.14 

 

PROVIDENT FINANCIAL HOLDINGS, INC.
Financial Highlights
(Unaudited - Dollars in Thousands, Except Share Information)

 Quarter Ended
March 31,
 Nine Months Ended
March 31,
 
  2020   2019   2020   2019 
SELECTED FINANCIAL RATIOS:       
Return (loss) on average assets 0.41%  (0.05)%  0.74%  0.42% 
Return (loss) on average stockholders’ equity 3.70%  (0.49)%  6.64%  3.97% 
Stockholders’ equity to total assets 11.12%  10.83%  11.12%  10.83% 
Net interest spread 3.23%  3.46%  3.44%  3.39% 
Net interest margin 3.30%  3.53%  3.51%  3.45% 
Efficiency ratio 75.12%  102.65%  70.50%  88.96% 
Average interest-earning assets to average        
interest-bearing liabilities 111.39%  111.28%  111.48%  111.04% 
         
SELECTED FINANCIAL DATA:        
Basic earnings (loss) per share$0.15  $(0.02) $0.82  $0.49  
Diluted earnings (loss) per share$0.15  $(0.02) $0.80  $0.48  
Book value per share$16.56  $16.17  $16.56  $16.17  
Shares used for basic EPS computation 7,468,932   7,506,770   7,477,922   7,481,095  
Shares used for diluted EPS computation 7,590,348   7,506,770   7,606,494   7,555,013  
Total shares issued and outstanding 7,436,315   7,497,357   7,436,315   7,497,357  
         
LOANS ORIGINATED AND PURCHASED FOR INVESTMENT:          
Mortgage Loans:        
Single-family$9,654  $15,288  $95,954  $56,684  
Multi-family 12,850   21,546   89,490   44,323  
Commercial real estate 5,570   5,197   14,468   13,677  
Construction 774   1,970   3,983   5,313  
Consumer loans -   -   1   -  
Total loans originated and purchased for investment$28,848  $44,001  $203,896  $119,997  
         
LOANS ORIGINATED FOR SALE:          
Retail originations$-  $72,353  $-  $287,399  
Wholesale originations -   38,353   -   166,045  
Total loans originated for sale$-  $110,706  $-  $453,444  
         
LOANS SOLD:        
Servicing released$-  $134,264  $-  $510,798  
Servicing retained -   2,409   -   5,193  
Total loans sold$-  $136,673  $-  $515,991  

 

PROVIDENT FINANCIAL HOLDINGS, INC.
Financial Highlights
(Unaudited-Dollars in Thousands, Except Share Information)

 Quarter
Ended
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 03/31/20  12/31/19  09/30/19  06/30/19  03/31/19 
SELECTED FINANCIAL RATIOS:              
Return (loss) on average assets0.41%  0.87%  0.95%  0.29%  (0.05)% 
Return (loss) on average stockholders’ equity3.70%  7.81%  8.46%  2.60%  (0.49)% 
Stockholders’ equity to total assets11.12%  11.18%  11.05%  11.12%  10.83% 
Net interest spread3.23%  3.53%  3.58%  3.46%  3.46% 
Net interest margin3.30%  3.59%  3.64%  3.52%  3.53% 
Efficiency ratio75.12%  68.78%  67.95%  90.38%  102.65% 
Average interest-earning assets to average interest-bearing liabilities111.39%  111.43%  111.61%  111.45%  111.28% 
               
SELECTED FINANCIAL DATA:              
Basic earnings (loss) per share$0.15  $0.32  $0.34  $0.10  $(0.02)
Diluted earnings (loss) per share$0.15  $0.31  $0.33  $0.10  $(0.02)
Book value per share$16.56  $16.54  $16.33  $16.12  $16.17 
Average shares used for basic EPS7,468,932  7,482,300  7,482,435  7,496,457  7,506,770 
Average shares used for diluted EPS7,590,348  7,658,050  7,647,763  7,626,661  7,506,770 
Total shares issued and outstanding7,436,315  7,483,071  7,479,682  7,486,106  7,497,357 
               
LOANS ORIGINATED AND PURCHASED FOR INVESTMENT:              
Mortgage Loans:              
Single-family$9,654  $52,671  $33,629  $31,982  $15,288 
Multi-family12,850  20,164  56,476  14,513  21,546 
Commercial real estate5,570  6,479  2,419  2,882  5,197 
Construction774  2,313  896  1,846  1,970 
Consumer loans-  1  -  -  - 
Total loans originated and purchased for investment$28,848  $81,628
  $93,420  $51,223  $44,001 
               
LOANS ORIGINATED FOR SALE:              
Retail originations$-  $-  $-  $9,593  $72,353 
Wholesale originations-  -  -  4,057  38,353 
Total loans originated for sale$-  $-  $-  $13,650  $110,706 
               
LOANS SOLD:              
Servicing released$-  $-  $-  $40,956  $134,264 
Servicing retained-  -  -  2,003  2,409 
Total loans sol$-  $-  $-  $42,959  $136,673 



PROVIDENT FINANCIAL HOLDINGS, INC.
Financial Highlights
(Unaudited - Dollars in Thousands)

 As of As of As of As of As of
 03/31/20 12/31/19 09/30/19 06/30/19 03/31/19
ASSET QUALITY RATIOS AND DELINQUENT LOANS:         
Recourse reserve for loans sold$250  $250  $250  $250  $250 
Allowance for loan losses$7,810  $6,921  $6,929  $7,076  $7,080 
Non-performing loans to loans held for investment, net 0.40%   0.36%   0.57%   0.71%   0.69% 
Non-performing assets to total assets 0.33%   0.31%   0.47%   0.57%   0.55% 
Allowance for loan losses to gross loans held for investment 0.85%   0.73%   0.74%   0.80%   0.79% 
Net loan charge-offs (recoveries) to average loans receivable (annualized) (0.01)%   (0.01)%   (0.02)%   (0.01)%   (0.01)% 
Non-performing loans$3,635  $3,427  $5,230  $6,218  $6,115 
Loans 30 to 89 days delinquent$2,827  $986  $990  $665  $699 
                    


 Quarter
Ended
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Ended
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Ended
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Ended
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Ended
 
 03/31/20  12/31/19  09/30/19  06/30/19  03/31/19 
Provision (recovery) for loan losses$874  $(22) $(181) $(25) $4 
Net loan charge-offs (recoveries)$(15) $(14) $(34) $(21) $(15)
              
 As of  As of  As of  As of  As of
 03/31/20  12/31/19  09/30/19  06/30/19  03/31/19
REGULATORY CAPITAL RATIOS (BANK):
Tier 1 leverage ratio10.36%  10.24%  10.21%  10.50%  10.17%
Common equity tier 1 capital ratio17.26%  16.62%  16.32%  18.00%  17.24%
Tier 1 risk-based capital ratio17.26%  16.62%  16.32%  18.00%  17.24%
Total risk-based capital ratio18.45%  17.65%  17.37%  19.13%  18.34%
              


 As of March 31,
 2020 2019
 Balance Rate(1) Balance Rate(1)
INVESTMENT SECURITIES:         
Held to maturity:         
Certificates of deposit$800 2.63% $400 2.74%
U.S. SBA securities2,083 2.10  2,917 2.85 
U.S. government sponsored enterprise MBS66,599 2.78  99,193 2.75 
Total investment securities held to maturity$69,482 2.76% $102,510 2.75%
          
Available for sale (at fair value):         
U.S. government agency MBS$3,001 3.54% $3,796 3.72%
U.S. government sponsored enterprise MBS1,630 4.17  2,198 4.60 
Private issue collateralized mortgage obligations197 4.40  300 4.20 
Total investment securities available for sale$4,828 3.79% $6,294 4.05%
               
Total investment securities$74,310 2.82% $108,804 2.83%
        
(1) The interest rate described in the rate column is the weighted-average interest rate or yield of all instruments, which are included in the balance of the respective line item.


PROVIDENT FINANCIAL HOLDINGS, INC.
Financial Highlights
(Unaudited - Dollars in Thousands)

 As of March 31,
 2020
 2019
  Balance Rate(1)   Balance Rate(1)  
 
LOANS HELD FOR INVESTMENT: 
Held to maturity: 
Single-family (1 to 4 units)$326,686 4.16% $314,824 4.52%
Multi-family (5 or more units) 475,941 4.33   449,812 4.35 
Commercial real estate 105,691 4.78   115,355 4.92 
Construction 6,346 6.49   4,139 7.44 
Other - -   167 6.50 
Commercial business 502 6.05   483 6.32 
Consumer 122 15.00   133 15.47 
Total loans held for investment 915,288 4.34%  884,913 4.50%
          
Advance payments of escrows 193     225   
Deferred loan costs, net 6,636     5,496   
Allowance for loan losses (7,810)    (7,080)  
Total loans held for investment, net$914,307    $883,554   
          
Purchased loans serviced by others included above$26,941 3.71% $17,122 3.35%
        
            
(1) The interest rate described in the rate column is the weighted-average interest rate or yield of all instruments, which are included in the balance of the respective line item.


 As of March 31,
 2020
 2019
 Balance
Rate(1)
 Balance
Rate(1)
            
DEPOSITS:           
Checking accounts – non interest-bearing$86,585 -% $90,875 -%
Checking accounts – interest-bearing 270,389 0.12   269,648 0.12 
Savings accounts 261,659 0.20   271,971 0.20 
Money market accounts 31,575 0.21   34,229 0.21 
Time deposits 185,623 1.08   210,161 1.14 
Total deposits$835,831 0.35% $876,884 0.38%
            
BORROWINGS:           
Overnight$- -% $- -%
Three months or less - -   - - 
Over three to six months - -   - - 
Over six months to one year 20,000 3.85   - - 
Over one year to two years 31,063 1.90   20,000 3.85 
Over two years to three years 20,000 1.75   21,121 2.06 
Over three years to four years 40,000 2.25   - - 
Over four years to five years 10,007 2.61   40,000 2.25 
Over five years 10,000 2.79   20,000 2.70 
            
            
Total borrowings$131,070 2.40%  101,121 2.62%
            
            
(1) The interest rate described in the rate column is the weighted-average interest rate or cost of all instruments, which are included in the balance of the respective line item.


PROVIDENT FINANCIAL HOLDINGS, INC.
Financial Highlights
(Unaudited - Dollars in Thousands)

 Quarter Ended Quarter Ended
 March 31, 2020 March 31, 2019
  Balance  Rate(1)   Balance 
 Rate(1) 
            
            
SELECTED AVERAGE BALANCE SHEETS:           
Loans receivable, net (2)$929,485 4.14% $915,049 4.38%
Investment securities 78,632 2.43%  101,851 2.32%
FHLB – San Francisco stock 8,199 7.03%  8,199 7.03%
Interest-earning deposits 61,900 1.20%  64,390 2.40%
Total interest-earning assets$1,078,216 3.87% $1,089,489 4.09%
Total assets$1,110,158   $1,119,717  
        
Deposits$836,855 0.36% $873,252 0.39%
Borrowings 131,075 2.44%  105,793 2.61%
Total interest-bearing liabilities$967,930 0.64% $979,045 0.63%
Total stockholders’ equity$123,786   $122,681  
  
(1) The interest rate described in the rate column is the weighted-average interest rate or yield/cost of all instruments, which are included in the balance of the respective line item.

(2) Includes loans held for sale at fair value for the quarter ended March 31, 2019.



 Nine Months Ended Nine Months Ended 
 March 31, 2020 March 31, 2019 
 Balance
 Rate(1)  Balance Rate(1) 
          
SELECTED AVERAGE BALANCE SHEETS:
         
Loans receivable, net (2)$922,246 4.34% $941,336 4.32
%
Investment securities87,260 2.53% 95,494 1.93%
FHLB – San Francisco stock8,199 7.03% 8,199 9.19%
Interest-earning deposits50,642 1.61% 66,498 2.20%
Total interest-earning assets$1,068,347 4.08% $1,111,527
 4.03%
Total assets$1,100,162    $1,142,238   
          
Deposits$833,731 0.37% $888,674 0.39%
Borrowings124,577 2.48% 112,363 2.56%
Total interest-bearing liabilities$958,308 0.64% $1,001,037 0.64%
Total stockholders’ equity$122,592    $121,895   
          
(1) The interest rate described in the rate column is the weighted-average interest rate or yield/cost of all instruments, which are included in the balance of the respective line item. 

(2) Includes loans held for sale at fair value for the nine months ended March 31, 2019. 



PROVIDENT FINANCIAL HOLDINGS, INC. 
Asset Quality (1)
(Unaudited – Dollars in Thousands)

  As of  As of As of As of As of 
 03/31/20 12/31/19 09/30/19 06/30/19 03/31/19 
Loans on non-accrual status (excluding restructured loans):          
Mortgage loans:          
Single-family$1,875 $1,607 $2,737 $3,315 $2,657 
Construction -  -  1,139  971  745 
Total 1,875  1,607  3,876  4,286  3,402 
           
Accruing loans past due 90 days or more: -  -  -  -  - 
Total -  -  -  -  - 
           
Restructured loans on non-accrual status:          
Mortgage loans: