Timberland earnings slip, but loans strong, it says

rboone@theolympian.comNovember 14, 2013 

Strong loan demand helped the parent company of Timberland Bank earn a net income of $894,000, according to its fiscal fourth-quarter earnings.

After adjustments to earnings, though, including the payment of a preferred stock dividend, Timberland Bancorp of Hoquiam earned a $696,000 profit, or 10 cents a share, which was down from last year’s $883,000 profit, or 13 cents a share.

President and Chief Executive Michael Sand said Wednesday it was a “good, solid, strong quarter,” that would have been stronger if not for some bank-owned property that had to be revalued.

Take away the revaluation expense and earnings per share for the fourth quarter would have been 22 cents, not 10 cents, he said.

Sand also said the company experienced good loan demand in the quarter, both from construction loans for single-family homes and other commercial loans.

The company, too, is considering whether to take a step that would end the payment of preferred stock dividends to private investors.

“During the current quarter, we will be evaluating the opportunity to purchase the preferred shares that remain outstanding from Timberland’s preferred share issuance in December 2008,” Sand said in a statement.

The preferred stock dividend payments stem from $16.6 million in TARP funds that the company borrowed at a time when the U.S. Treasury urged community banks to accept money because of concerns about the economy during the financial meltdown.

Stock dividends were first repaid to Treasury and later to private investors, after the remaining balance of the original $16.6 million was auctioned off by Treasury.

The company repurchased 27 percent of those preferred shares earlier in the year and now is contemplating the remaining 73 percent, Sand said Wednesday.

The company also announced that it will pay a cash dividend of three cents a share on Nov. 29 to all shareholders of record as of Nov. 18.

Timberland’s stock, which trades under the ticker symbol TSBK, closed up more than 2 percent Wednesday, or 21 cents, to $8.90 a share. In the past 52 weeks, the stock has ranged from $5.77 a share to $9.29 a share.

Rolf Boone: 360-754-5403 rboone@theolympian.com

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