William Penn Bancorp, Inc. Announces Third Quarter Earnings

LEVITTOWN, PA / ACCESSWIRE / May 2, 2018 / William Penn Bancorp, Inc. (the "Company") WMPN announced net income of $518,000 ($0.15 per basic and diluted share) for the three months ended March 31, 2018 as compared to $670,000 ($0.19 per basic and diluted share) for the same period last year. Net interest income after provision for loan losses increased from $2,214,000 for the three months ended March 31, 2017 to $2,270,000 for the three months ended March 31, 2018. Non-interest expense increased to $1,646,000 for three months ended March 31, 2018, from $1,344,000 for the same period prior year. This increase was primarily due to an increase in salaries, employee and director benefit expenses combined with other non-operating expenses related to the announced pending merger (see below). The Company had total assets of $304.0 million at March 31, 2018 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 $800,000 ($0.23 per basic and diluted share) for the nine months ended March 31, 2018 as compared to $1,866,000 ($0.54 per basic and diluted share) for the same period last year. The decline was primarily attributable to a $959,000 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. Net interest income after provision for loan losses increased from $6,349,000 for the nine months ended March 31, 2017 to $6,720,000 for the nine months ended March 31, 2018. Non-interest expense increased to $4,613,000 for the nine months ended March 31, 2018, from $4,000,000 for the nine months ended March 31, 2017. This increase was primarily attributable to merger related expenses, and an increase in salaries, employee and director benefit expenses. Income taxes increased by $722,000 to $1,696,000 for the nine months ended March 31, 2018 as compared to $974,000 for the same period prior year, all of the increase being due to the one-time non-cash charge described above, partially offset by the decrease in net income before income tax. During fiscal 2018, 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 March 31, 2018, the Company had 3,641,018 shares of common stock issued and 3,464,686 shares outstanding, of which 2,664,045 shares were 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 early in the third quarter of 2018. 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. As of this time, approvals have been received from the Federal Reserve, the Federal Deposit Insurance Corporation (FDIC), and the Pennsylvania Department of Banking and Securities.

William Penn Bancorp, Inc. is the holding company for William Penn Bank, which serves Bucks County, Pennsylvania 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 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. Mr. Corcoran has announced his retirement, effective May 11, 2018. The Bank has engaged an interim chief financial officer as it commences the search for a permanent replacement for Mr. Corcoran.

Board of Directors: William J. Feeney (Chairman), Craig Burton, Charles Corcoran, Glenn Davis, William B. K. Parry, Jr., and Terry L. Sager. Mr. Corcoran has announced his retirement from the Board of Directors, effective May 16, 2018. A successor has not been appointed at this time.

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 all required 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.

FOR FURTHER INFORMATION

Terry L. Sager, President
215-269-1200

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

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SOURCE: William Penn Bancorp, Inc.