SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): April 24, 2007
UNITED BANCSHARES, INC.
(Exact name of Registrant as specified in its Charter)
Ohio | 000-29283 | 34-1516518 | ||
(State or other jurisdiction of incorporation) | (Commission File No.) | (IRS Employer Identification Number) | ||
100 S. High Street, Columbus Grove, Ohio | 45830-1241 | |||
(Address of principal executive offices) | (Zip Code) | |||
Registrant’s telephone number, including area code: |
| (419) 659-2141 | ||
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. Results of Operations and Financial Condition.
On April 24, 2007, United Bancshares, Inc. issued an earnings release announcing its financial results for the quarter ended March 31, 2007 and that the Board of Directors declared a dividend of $0.14 per share. A copy of the earnings release (Exhibit 99.1) and unaudited financial information (Exhibit 99.2) are attached.
The information in this Item 2.02, including Exhibit 99.1 and Exhibit 99.2 furnished herewith, is being furnished and shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liabilities of that Section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933 or the Exchange Act, except as otherwise stated in such filing.
Item 7.01. Regulation FD Disclosure.
On April 24, 2007, United Bancshares, Inc. issued an earnings release announcing its financial results for the quarter ended March 31, 2007 and that the Board of Directors declared a dividend of $0.14 per share. A copy of the earnings release (Exhibit 99.1) and unaudited financial information (Exhibit 99.2) are attached.
The information in this Item 7.01, including Exhibit 99.1 and Exhibit 99.2 furnished herewith, is being furnished and shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liabilities of that Section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933 or the Exchange Act, except as otherwise stated in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. | Description | ||||||||
99.1 | Release dated April 24, 2007 | ||||||||
99.2 | Unaudited Financial Information | ||||||||
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.
United Bancshares, Inc. | ||||||
Date: April 24, 2007 | By: /s/ Brian D. Young | |||||
Brian D. Young CFO | ||||||
Exhibit 99.1
On April 24, 2007, United Bancshares, Inc. issued the following release:
United Bancshares, Inc. (Nasdaq: UBOH – news), a bank holding company headquartered in Columbus Grove, Ohio with consolidated assets of $554 million, today announced first quarter 2007 operating results and that the Board of Directors declared a dividend of $0.14 per share to shareholders of record on May 31, 2007, payable on June 15, 2007. The Union Bank Company (“Union”), a wholly-owned subsidiary of the Corporation, is engaged in the business of commercial banking. Union is an Ohio state-chartered bank, which serves Allen, Putnam, Sandusky, Van Wert and Wood Counties, with office locations in Bowling Green, Columbus Grove, Delphos, Gibsonburg, Kalida, Leipsic, Lima, Ottawa, and Pemberville.
For the quarter ended March 31, 2007, the Corporation reported net income of $977,000, or $0.27 basic earnings per share. This compares to first quarter 2006 net earnings of $1,181,000, or $0.33 basic earnings per share. Compared with the same period in 2006, first quarter 2007 net income decreased $204,000 or 17.3%. The $204,000 decrease was primarily the result of a $259,000 decrease in net interest income, a $240,000 loss on write-down of available-for-sale securities, a decrease of $111,000 in the fair value of mortgage servicing rights during the quarter, and an increase of $50,000 in the provision for loan losses, offset by a gain of $355,000 on the sale of Union’s credit card portfolio and a decrease of $89,000 in the provision for income taxes.
Net interest income was $4,128,000 for the first quarter of 2007, compared to $4,387,000 for the same period of 2006. For the three months ended March 31, 2007, the net interest margin (on a taxable equivalent basis) was 3.41% compared with 3.70% for the same period of 2006. Management believes that decrease was primarily the result of pressures on the net interest margin from market conditions.
Gain on sales of loans amounted to $78,000 for the quarter ended March 31, 2007, compared to $63,000 for the comparable 2006 period. The quarterly gain included capitalized servicing rights of $46,000 and $45,000 on $4.8 million and $4.6 million of originated loan sales during the quarters ended March 31, 2007 and 2006, respectively. The balance of the gain on sales of loans represented cash gains. Effective March 31, 2007, Union entered into an agreement to sell its credit card portfolio resulting in a gain for the quarter ended March 31, 2007 of $355,000. As a result of Union’s Board approving management’s plan to restructure its balance sheet, including selling approximately $15.5 million of available-for-sale securities, an impairment loss of $240,000 was recognized for the quarter ended March 31, 2007, representing the amount by which amortized cost exceeded fair value for the securities being sold.
Other non-interest income decreased $111,000 (16.0%) to $582,000 for the quarter ended March 31, 2007 due to the decrease during the quarter of the fair value of mortgage servicing rights. As a result of the adoption of Statement of Financial Accounting Standards No. 156, “Accounting for Servicing of Financial Assets, an Amendment of FASB Statement 140” (Statement 156) effective January 1, 2007, quarterly changes in the fair value of mortgage servicing rights will be reflected in the Corporation’s operations.
For the quarter ended March 31, 2007, non-interest expenses totaled $3,561,000, compared to $3,555,000 for the comparable period of 2006, a $6,000 (0.2%) increase. Management believes the $6,000 increase is indicative of the Corporation’s commitment to control costs in an environment where the costs of conducting business continue to increase. The Corporation’s efficiency ratio for the first quarter of 2007 was 69.24%, compared to 66.17% for the same period of 2006.
Return on average assets was 0.70% for the first quarter of 2007, compared to 0.88% for the comparable quarter of 2006. Return on average equity for the first quarter of 2007 was 8.37% compared to 10.81% for the same period of 2006.
United Bancshares, Inc. is a locally owned and operated holding company of The Union Bank Company which serves Allen, Putnam, Sandusky, Van Wert and Wood Counties, with office locations in Bowling Green, Columbus Grove, Delphos, Gibsonburg, Kalida, Leipsic, Lima, Ottawa, and Pemberville.
This release may contain certain forward-looking statements that are provided to assist in the understanding of anticipated future financial performance. However, such performance involves risk and uncertainties that may cause actual results to differ materially. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to, the strength of the local economies in which operations are conducted, the effects of and changes in policies and laws of regulatory agencies, inflation, and interest rates. For further discussion of certain factors that may cause such forward-looking statements to differ materially from actual results, refer to the 2006 Form 10-K.
Exhibit 99.2
United Bancshares, Inc.
Quarterly Report
March 31, 2007
Dear Shareholders, Customers and Employees,
I am pleased to report that during the first quarter of 2007 the Company increased its loan portfolio, shareholders’ equity and non-interest income, while controlling non-interest expenses. As compared to December 31, 2006, loans and shareholders’ equity increased $3.8 million and $1.1 million, respectively, while first quarter 2007 non-interest income and non-interest expenses increased $22,000 and $6,000, respectively, as compared to the same period in 2006.
The Company’s earnings per share for the first quarter of 2007 were $0.27 compared to $0.33 for the same period in 2006. Earnings were significantly impacted by continued margin compression created by an inverted yield curve. Consequently, net interest income declined $259,000 (5.9%) for the first quarter of 2007 as compared to the same period in 2006. Other significant transactions during the first quarter of 2007 included the Company’s sale of its credit card portfolio resulting in a gain of $355,000; an $111,000 decrease in the fair value of the Company’s mortgage servicing rights portfolio; and a $240,000 impairment write-down relating to the planned sale of approximately $15.5 million of investment securities. This sale is part of a plan to restructure the Company’s balance sheet.
We will continue to work diligently to grow the Company and seek additional opportunities to add value to the institution. Your continued support is appreciated.
Respectfully,
Daniel W. Schutt
President & CEO
United Bancshares, Inc.
and Subsidiary
Financial Information (unaudited)
Three Months
Three Months
ended
ended
March 31, 2007
March 31, 2006
(dollars in thousands, except share data)
CONDENSED STATEMENT OF INCOME
Interest income
$8,465
$7,717
Interest expense
4,337
3,330
Net interest income
4,128
4,387
Provision for loan losses
150
100
Net interest income after provision for loan losses
3,978
4,287
Non-interest income
774
752
Non-interest expenses
3,561
3,555
Income before income taxes
1,191
1,484
Provision for income taxes
214
303
Net income
$977
$1,181
Average common shares outstanding
3,554,944
3,613,504
PER COMMON SHARE
Net income
$0.27
$0.33
Cash dividends
$0.14
$0.13
Book value
$13.36
$12.12
Closing price
$16.17
$16.38
FINANCIAL RATIOS
Return on average assets
0.70%
0.88%
Return on average equity
8.37%
10.81%
Net interest margin
3.41%
3.70%
Efficiency ratio
69.24%
66.17%
Loans to deposits
88.08%
88.03%
Allowance for loan losses to loans
0.65%
0.79%
Cash dividends to net income
50.61%
39.71%
PERIOD END BALANCES
As of
As of
March 31, 2007
Dec. 31, 2006
Assets
$553,781
$550,375
Loans (including available-for-sale)
$339,349
$335,549
Deposits
$385,259
$377,640
Shareholders’ equity
$47,204
$46,152
Common shares outstanding
3,532,940
3,568,049
DIRECTORS/OFFICERS
UNITED BANCSHARES, INC.
Robert L. Benroth
H. Edward Rigel
Robert L. Dillhoff
David P. Roach
R. Steven Unverferth
James N. Reynolds— Chairman
Daniel W. Schutt—President/CEO
Bonita R. Selhorst—Secretary
Brian D. Young—CFO/Executive V.P./Treasurer
DIRECTORS
THE UNION BANK CO.
Robert L. Benroth
William R. Perry
Robert L. Dillhoff
James N. Reynolds
H. Edward Rigel David P. Roach
Herbert H. Huffman Robert M. Schulte, Sr.
Kevin L. Lammon
R. Steven Unverferth
Daniel W. Schutt—President/CEO/Chairman
INVESTOR MATERIALS:
United Bancshares, Inc. has traded its common stock on the Nasdaq Markets Exchange under the symbol “UBOH” since March 2001. Annual and quarterly shareholder reports, regulatory filings, press releases, and articles about The Union Bank Company are available in the Shareholder Information section of our website www.theubank.com or by calling 1-800-837-8111.
Locations
1204 W. Wooster St.
Bowling Green, OH 43402
419-353-6088
100 S. High St.
Columbus Grove, OH 45830
419-659-2141
101 Progressive Drive
Columbus Grove, Ohio 45830
419-659-4250
114 E. 3rd St.
Delphos, OH 45833
419-692-2010
230 W. Madison St.
Gibsonburg, OH 43431
419-637-2124
110 E. North St.
Kalida, OH 45853
419-532-3366
318 S. Belmore St.
Leipsic, OH 45856
419-943-2171
215 W. Market St.
Lima, OH 45801
419-228-2114
1410 Bellefontaine Ave.
Lima, OH 45804
419-229-6500
3211 Elida Rd.
Lima, OH 45805
419-331-3211
245 W. Main St.
Ottawa, OH 45875
419-523-2265
132 E. Front St.
Pemberville, OH 43450
419-287-3211