William Penn Bancorp, Inc. Announces Second Quarter Earnings

LEVITTOWN, PA / ACCESSWIRE / February 23, 2018 / William Penn Bancorp, Inc. (the "Company") WMPN announced a net loss of $309,000 (($0.09) per basic and diluted share) for the three months ended December 31, 2017, as compared to a profit of $651,000 ($0.19 per basic and diluted share) for the same period last year. Net interest income after provision for loan losses increased from $2,071,000 for the three months ended December 31, 2016 to $2,316,000 for the three months ended December 31, 2017. Non-interest expense increased to $1,587,000 for three months ended December 31, 2017, from $1,296,000 for the same period prior year. This increase was primarily due to an increase in other non-operating expenses related to the announced merger (see below). Income taxes increased by $804,000 to $1,174,000 for three months ended December 31, 2017, as compared to $370,000 for the same period in the prior year. This increase was primarily due to the effect of the one-time non-cash charge related to the re-measurement of the Company's deferred tax assets arising from the lower U.S. corporate tax rate provided for by the Tax Cuts and Jobs Act enacted in December 2017. The Company had total assets of $300.6 million at December 31, 2017, as compared to $316.0 million at June 30, 2017. The decline was primarily due to the repayment of $14,000,000 of advances from the Federal Home Loan Bank during the quarter ended December 31, 2017.

Net income was $282,000 ($0.08 per basic and diluted share) for the six months ended December 31, 2017, as compared to $1,196,000 ($0.35 per basic and diluted share) for the same period last year. The decline is attributable to the write down of deferred tax assets as discussed previously. Net interest income after provision for loan losses increased from $4,135,000 for the six months ended December 31, 2016 to $4,450,000 for the six months ended December 31, 2017. Non-interest expense increased to $2,967,000 for the six months ended December 31, 2017, from $2,656,000 for the six months ended December 31, 2016. Income taxes increased by $820,000 to $1,467,000 for the six months ended December 31, 2017, as compared to $647,000 for the same period prior year. During fiscal 2018, commencing with the quarter ended December 31, 2017, the Company's statutory income tax rate will be 27.5%, as compared to companies which are calendar year tax reporting companies whose statutory rate decreased to 21% starting January 1, 2018. Effective July 1, 2018, the Company's statutory tax rate will be reduced to 21%.

On July 20, 2017, the Company declared a dividend of $0.31 per share payable on August 10, 2017 to stockholders of record on August 1, 2017. In the same period last year, a cash dividend of $0.28 per share was declared in July of 2016 and paid to shareholders in August of 2016. As of December 31, 2017, the Company had 3,641,018 shares of common stock issued and 3,464,686 shares of common stock outstanding, of which 2,664,045 shares are held by William Penn, MHC, the Company's mutual holding company parent (the "MHC").

On December 6, 2017, the Company and Audubon Savings Bank ("ASB") jointly announced the execution of a definitive merger agreement pursuant to which ASB will merge with and into William Penn Bank, the Company's wholly-owned subsidiary. The Company, the MHC, William Penn Bank, and ASB have submitted the required regulatory applications to effect the merger of ASB with William Penn Bank. The merger is expected to close late in the second quarter of 2018 or early in the third quarter. The completion of the merger is subject to certain customary closing conditions, including approval by the ASB members and the receipt of all required regulatory approvals.

William Penn Bancorp, Inc. is the holding company for William Penn Bank, which serves Bucks County through its main office in Levittown, and additional branch offices in Morrisville and Richboro, Pennsylvania.

The Company's executive offices are located at 1309 S. Woodbourne Road, Levittown, Pennsylvania 19057. William Penn Bank's deposits are insured up to the legal maximum (generally $250,000 per depositor) by the Federal Deposit Insurance Corporation (FDIC). The primary federal regulator for William Penn Bank is the Federal Deposit Insurance Corporation (FDIC).

Senior Management: Terry L. Sager, President and Chief Executive Officer, Charles Corcoran, Executive Vice President and Chief Financial Officer, and James Douglas, Vice President and Chief Lending Officer.

Board of Directors: William J. Feeney (Chairman), Craig Burton, Charles Corcoran, Glenn Davis, William B. K. Parry, Jr., and Terry L. Sager.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, expectations or predictions of future financial or business performance, conditions relating to the Company and ASB, or other effects of the proposed merger on the Company and ASB. These forward-looking statements include statements with respect to the Company's beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, that are subject to significant risks and uncertainties, and are subject to change based on various factors (some of which are beyond the Company's control). The words "may," "could," "should," "would," "will," "believe," "anticipate," "estimate," "expect," "intend," "plan," and similar expressions are intended to identify forward-looking statements.

In addition, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: the ability to obtain regulatory approvals and satisfy other closing conditions to the merger, including approval by the members of ASB; delay in closing the merger; difficulties and delays in integrating the ASB business or fully realizing anticipated cost savings and other benefits of the merger; business disruptions following the merger; the strength of the United States economy in general and the strength of the local economies in which the Company and ASB conduct their operations; general economic conditions, legislative and regulatory changes, monetary and fiscal policies of the federal government, changes in tax policies, rates and regulations of federal, state and local tax authorities, changes in interest rates, deposit flows, the cost of funds, demand for loan products, demand for financial services, competition, changes in the quality or composition of the Company's loan, investment and mortgage-backed securities portfolios, changes in accounting principles, policies or guidelines and other economic, competitive, governmental and technological factors affecting the Company's operations, markets, products, services and fees; and the success of the Company at managing the risks involved in the foregoing.

The Company does not undertake, and specifically disclaims, any obligation to publicly release the results of any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances arising after the date hereof.

WILLIAM PENN BANCORP, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)
(Dollars in thousands, except per share data)

FOR FURTHER INFORMATION:

Contact Terry L. Sager, President
215-269-1200

SOURCE: William Penn Bancorp, Inc.