Fox Chase Bancorp, Inc. Reports Increased Earnings for the Three Months Ended March 31, 2015

HATBORO, Pa., April 29, 2015 (GLOBE NEWSWIRE) -- Fox Chase Bancorp, Inc. (the "Company") FXCB, the holding company for Fox Chase Bank (the "Bank"), today announced net income of $2.3 million, or $0.20 per diluted share, for the three months ended March 31, 2015, compared to net income of $2.0 million, or $0.17 per diluted share, for the three months ended March 31, 2014 and $2.1 million, or $0.19 per diluted share, for the three months ended December 31, 2014.

Commenting on performance for the quarter, Thomas M. Petro, President and CEO said, "The Company's business fundamentals remained strong as earnings improved and average commercial loan growth exceeded 8%. A portion of this growth is from higher seasonal line of credit utilization and is expected to normalize later in 2015; however, we expect to see continued loan growth during 2015. To continue to support our commercial banking strategy, during the quarter the Company completed a comprehensive review of its systems and processes and decided to change its outsourced data processing systems to a new vendor. This system conversion is expected to be completed in the fourth quarter of 2015, and will provide the Company the ability to be more responsive to customers, deliver the innovative services our customers have come to expect and provide increased productivity. The pretax expenses related to this initiative were $230,000 in the first quarter of 2015 and are estimated to be approximately $1.1 million to $1.3 million for 2015. It is our objective to offset as much of these expenses as we can during 2015."

Highlights for the quarter ended March 31, 2015 included:

• Total average assets were $1.10 billion for the three months ended March 31, 2015 as compared to $1.06 billion for the three months ended December 31, 2014 and $1.09 billion for the three months ended March 31, 2014. Total average commercial loans increased by $43.6 million, or 7.6%, to $615.5 million for the three months ended March 31, 2015, compared to $571.9 million for the three months ended December 31, 2014. Additionally, average commercial loans increased by $49.3 million, or 8.7%, for the three months ended March 31, 2015, compared to $566.2 million for the three months ended March 31, 2014.
• Assets were $1.12 billion at March 31, 2015 as compared to $1.09 billion at December 31, 2014 and $1.08 billion at March 31, 2014. Total commercial loans increased by $35.0 million, or 5.8%, to $642.5 million at March 31, 2015, compared to $607.5 at December 31, 2014, and increased $82.9 million, or 14.8%, compared to $559.6 million at March 31, 2014.
• Nonperforming assets totaled $6.2 million, or 0.55% of total assets, at March 31, 2015 compared to $6.3 million, or 0.57% of total assets, at December 31, 2014 and $8.6 million, or 0.79% of total assets, at March 31, 2014.
• Return on average assets improved to 0.83% for the three months ended March 31, 2015, compared to 0.79% for the three months ended December 31, 2014 and 0.72% for the three months ended March 31, 2014.
• Net interest income increased $355,000, or 4.3%, to $8.7 million for the three months ended March 31, 2015, compared to $8.3 million for the three months ended March 31, 2014. The net interest margin was 3.29% for the three months ended March 31, 2015, 3.18% for the three months ended December 31, 2014, and 3.17% for the three months ended March 31, 2014. During the three months ended March 31, 2015, the Company received a $254,000 special dividend from the FHLB of Pittsburgh, which increased the net interest margin by 0.10%.
• Credit related costs, which include (i) provision for loan losses, (ii) valuation adjustments on assets acquired through foreclosure and (iii) net (loss) gain on sale of assets acquired through foreclosure, totaled $487,000 for the three months ended March 31, 2015, compared to $305,000 for the three months ended December 31, 2014 and $282,000 for the three months ended March 31, 2014. Net loan charge-offs totaled $24,000 for the three months ended March 31, 2015, compared to $720,000 for the three months ended December 31, 2014 and $93,000 for the three months ended March 31, 2014.
• Noninterest income increased $112,000 to $571,000 for the three months ended March 31, 2015 compared to $459,000 for the three months ended March 31, 2014 primarily due to an increase of $73,000 in equity in earnings of affiliate due to higher mortgage volumes and an increase of $32,000 in service charges and other fee income due to increased loan fees.
• Noninterest expense decreased $228,000, or 3.8%, to $5.8 million for the three months ended March 31, 2015, compared to $6.0 million for the three months ended March 31, 2014. This decrease was primarily due to a decrease of $291,000 in assets acquired through foreclosure expense as the Company recorded $15,000 in valuation adjustments on assets acquired through foreclosure during the three months ended March 31, 2015 compared to $282,000 during the three months ended March 31, 2014. The Company also incurred a decrease of $115,000 in professional fees offset by an increase of $188,000 in data processing costs. The increase in data processing costs was largely due to the decision during the first quarter of 2015 to change outsourced data processing systems.
• Income tax provision for the three months ended March 31, 2015 includes the reversal of an $182,000 valuation allowance on certain state deferred tax assets. The effective income tax rate for the three months ended March 31, 2015 was 24.2%. Excluding this reversal, the effective income tax rate for the three months ended March 31, 2015 was 30.3% compared to 29.7% for the three months ended March 31, 2014.
• During the three months ended March 31, 2015, the Company repurchased 69,800 shares of treasury stock and has approximately 457,000 shares remaining in its' approved repurchase plan.
• As of March 31, 2015, the Company and Bank adopted the final rule for the Basel III capital framework and continue to be well-capitalized by all capital measures.

The Company also announced that its Board of Directors declared a cash dividend of $0.14 per outstanding share of common stock. The dividend will be paid on or about May 28, 2015 to stockholders of record as of the close of business on May 14, 2015.

Fox Chase Bancorp, Inc. will host a conference call to discuss first quarter 2015 results on Thursday, April 30, 2015 at 9:00 am EDT. The general public can access the call by dialing (877) 507-3275. A replay of the conference call will be available through June 12, 2015 by dialing (877) 344-7529; use Conference ID: 10063905. Participants may preregister at http://dpregister.com/10063905.

Fox Chase Bancorp, Inc. is the stock holding company of Fox Chase Bank. The Bank is a Pennsylvania state-chartered savings bank originally established in 1867. The Bank offers traditional banking services and products from its main office in Hatboro, Pennsylvania and nine branch offices in Bucks, Montgomery, Chester and Philadelphia Counties in Pennsylvania and Atlantic and Cape May Counties in New Jersey. For more information, please visit the Bank's website at www.foxchasebank.com.

This news release contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements can generally be identified by the fact that they do not relate strictly to historical or current facts. They often include words like "believe," "expect," "anticipate," "estimate" and "intend" or future or conditional verbs such as "will," "would," "should," "could" or "may." Statements in this release that are not strictly historical are forward-looking and are based upon current expectations that may differ materially from actual results. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those anticipated by the statements made herein. These risks and uncertainties involve general economic trends, changes in interest rates, loss of deposits and loan demand to other financial institutions, substantial changes in financial markets; changes in real estate value and the real estate market, regulatory changes, possibility of unforeseen events affecting the industry generally, the uncertainties associated with newly developed or acquired operations, the outcome of pending litigation, and market disruptions and other effects of terrorist activities. The Company undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unforeseen events, except as required under the rules and regulations of the Securities and Exchange Commission.