OAK Financial Achieves Record Assets
According to the company, the decline in 2007 net income was the result of a significant increase in the provision for loan losses, loan collection costs primarily with one commercial borrower and employee health care costs. However, by year end OAK reached a new record for total assets, which exceeded $743 million, up $74 million, or 11 percent, from the year before.
Fourth quarter net income was down 22 percent to $1.47 million, compared with $1.8 million in 2006’s fourth quarter. Basic and diluted earnings per share in the just passed quarter were 55 cents, marking a decline of 21 percent form the 70 cents reported for the prior year’s fourth quarter. The company indicated that earnings were impacted by an increased in the provision for loan losses, the reversal of previously-accrued interest on loans placed on non-accrual and unusually high employee health care costs.
The provision for loan losses was $442,000 higher in the fourth quarter than the year-ago quarter as a result of the continued weakness in the residential real estate construction market, continued overall weakness in the
Total loans in fiscal 2007 increased $68 million, or 13 percent, and total deposits declined $2 million, or less than 1 percent. The decline in deposits, the company said, reflects and intentional shift from brokered certificates of deposits to lower costing Federal Home Loan Bank advances, repurchase agreements and federal funds purchased.
“Despite unprecedented challenges to the