Northern Star Financial, Inc. (OTCBB: NSBK) today announced results
for the Company and its wholly owned subsidiary Northern Star Bank
(Bank) for the fourth quarter and for the fiscal year ending June
30, 2008.
Northern Star Financial, Inc., the parent company of Northern
Star Bank, reported a consolidated net loss of $186,316 in the
fourth quarter and $518,974 for the fiscal year ended June 30, 2008
compared with a net loss of $142,896 in the fourth quarter and a
net loss of $569,424 during fiscal year 2007. The Company reported
a basic loss per share of $(0.61) during the fiscal year ending
June 30, 2006 compared with a basic loss of $(0.77) per share
during fiscal year ending June 30, 2007. The Company's wholly owned
subsidiary, Northern Star Bank, reported operating losses of $3,200
during the fourth quarter and $87,441 for the fiscal year ending
June 30, 2008.
Thomas Stienessen, President and Chief Executive Officer,
commented that when comparing operations to the prior fiscal year
there had been a $50,000 improvement in annual operating results.
President Stienessen reiterated his comments of previous earnings
releases in that the Company's operating results were overshadowed
by the more than $200 thousand annual cost of carrying the
Company's debt.
When commenting on the organization's operating performance
Stienessen reported that sudden and deep drops in interest rates
had resulted in a $300 thousand reduction in net interest income
during the prior fiscal year which was exacerbated by $100 thousand
increase in professional fees associated with the Company's
previously announced plans to acquire Rive City Mortgage and
Financial, Inc. of Eagan, Minnesota. Stienessen advised investors
that the Company was able to compensate for the loss in net
interest income and for the increase in expenses by increasing fee
income $110 thousand; reducing compensation and benefits by $90
thousand; and a $110 thousand reduction in provisions for loan
losses.
The Company commenced operations on January 25, 1999 as a bank
holding company whose subsidiary provides financial services.
Northern Star Bank's business is that of financial intermediary and
consists primarily of attracting deposits from the general public
and using such deposits, together with borrowings and other funds,
to make secured and unsecured loans to business and professional
concerns and mortgage loans secured by residential real estate and
other consumer loans.
THIS PRESS RELEASE CONTAINS FORWARD-LOOKING INFORMATION AND
ACTUAL RESULTS MAY DIFFER.
Statements that Northern Star Financial, Inc. may publish,
including those in this announcement that are not strictly
historical, are "forward-looking" statements made under the safe
harbor provisions of the Private Securities Litigation Reform Act
of 1995.
Forward-looking statements are inherently unreliable and actual
results may vary. Factors which could cause actual results to
differ from these forward-looking statements include changes in
competitive marketplace, changes in the interest rate environment,
economic conditions, and outcome of pending litigations, risks
associated with credit quality and other factors discussed in the
Company's filings with the Securities and Exchange Commission. The
Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
NORTHERN STAR FINANCIAL, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
YEARS ENDED JUNE 30, 2008 AND 2007
2008 2007
------------ ------------
ASSETS
Cash and due from banks $ 1,037,213 $ 1,270,856
Federal funds sold - 1,447,688
------------ ------------
Cash and cash equivalents 1,037,213 2,718,544
Securities available for sale, at fair value 4,804,281 4,093,750
Restricted stock, at cost 500,000 420,900
Loans held for sale 9,740,876 -
Loans receivable, net of allowance for loan
and lease losses of $319,657 and $319,978 36,523,996 39,883,169
Property and equipment, net of depreciation 225,238 279,089
Other real estate owned 954,422 -
Cash surrender value of life insurance 1,151,488 1,109,770
Accrued interest receivable 254,316 281,204
Other assets 157,644 152,311
------------ ------------
Total Assets $ 55,349,474 $ 48,938,737
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Demand deposits $ 2,173,937 $ 2,558,306
NOW and money market 8,128,707 8,716,094
Savings 3,490,022 3,440,319
Time deposits 25,794,456 22,619,026
------------ ------------
Total deposits 39,587,122 37,333,745
Federal funds purchased 2,902,194 -
Notes payable and other borrowings 8,814,693 8,066,862
Subordinated notes payable 2,155,000 1,450,000
Accrued interest payable 565,439 486,173
Other liabilities 162,721 30,370
------------ ------------
Total Liabilities 54,187,169 47,367,150
Stockholders' Equity:
Common stock, $.01 par value, 15,000,000 shares
authorized; 871,553 and 837,188 shares issued 8,715 8,371
Undesignated stock, par value $.01 per share;
5,000,000 shares authorized, no shares issued - -
Additional paid in capital 6,107,930 5,987,838
Accumulated deficit (4,909,732) (4,390,764)
Accumulated other comprehensive income (loss) (44,608) (33,858)
------------ ------------
Total Stockholders' Equity 1,162,305 1,571,587
------------ ------------
Total Liabilities and Stockholders
Equity $ 55,349,474 $ 48,938,737
============ ============
NORTHERN STAR FINANCIAL, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
YEARS ENDED JUNE 30, 2008 AND 2007
2008 2007
----------- -----------
INTEREST INCOME
Loans receivable $ 2,963,498 $ 3,163,823
Securities available-for-sale 232,971 182,713
Other 92,429 106,423
----------- -----------
Total interest income 3,288,898 3,452,959
INTEREST EXPENSE
Deposits 1,531,997 1,508,932
Borrowed Funds 621,734 534,677
----------- -----------
Total interest expense 2,153,731 2,043,609
----------- -----------
NET INTEREST INCOME 1,135,167 1,409,350
PROVISON FOR LOAN LOSSES 4,500 114,885
----------- -----------
NEW INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 1,130,667 1,294,465
NON-INTEREST INCOME
Other fees and service charges 229,330 164,528
Gain on sale of loans held for sale 157,209 108,166
Gain on sale of investments 12,225 -
Other income - 12,580
----------- -----------
Total non-interest income 398,764 285,274
NON-INTEREST EXPENSE
Compensation and employee benefits 941,917 1,032,499
Board fees 23,750 27,100
Occupancy 266,137 262,983
Printing and supplies 33,560 49,761
Furniture, fixtures and equipment depreciation 39,450 68,458
Data processing 209,770 192,200
Professional fees 206,148 87,614
Other 327,673 428,548
----------- -----------
Total non-interest expense 2,048,405 2,149,163
----------- -----------
NET LOSS $ (518,974) $ (569,424)
=========== ===========
NET LOSS PER COMMON SHARE
Basic and diluted loss per share
of common stock $ (0.61) $ (0.77)
=========== ===========
Contact: Thomas Stienessen Chief Executive Officer (507)
387-2265
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