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Malvern Bancorp, Inc. Reports Third Fiscal Quarter 2019 Results

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PAOLI, Pa., July 31, 2019 (GLOBE NEWSWIRE) -- Malvern Bancorp, Inc. (NASDAQ:MLVF) (the "Company"), parent company of Malvern Bank, National Association ("Malvern" or the "Bank"), today reported operating results for the third fiscal quarter ended June 30, 2019.   Net income amounted to $2.7 million, or $0.35 per fully diluted common share, for the quarter ended June 30, 2019, compared with net income of $2.2 million, or $0.35 per fully diluted common share, for the quarter ended June 30, 2018. Annualized return on average assets ("ROAA") was 0.88 percent for the three months ended June 30, 2019, compared to 0.85 percent for the three months ended June 30, 2018, and annualized return on average equity ("ROAE") was 7.66 percent for the three months ended June 30, 2019, compared with 8.40 percent for the three months ended June 30, 2018.  Excluding provision expense, net of tax, of $44,000, third fiscal quarter 2019 adjusted ROAA was 0.89 percent and adjusted ROAE was 7.79 percent.

For the nine months ended June 30, 2019, net income amounted to $6.6 million, or $0.87 per fully diluted common share, compared with net income of $4.7 million, or $0.72 per fully diluted common share, for the nine months ended June 30, 2018.  ROAA was 0.78 percent for the nine months ended June 30, 2019, compared to 0.59 percent for the nine months ended June 30, 2018, and ROAE was 6.48 percent for the nine months ended June 30, 2019, compared with 5.92 percent for the nine months ended June 30, 2018.  Excluding provision expense, net of tax, of $1.9 million, adjusted ROAA was 1.00 percent and adjusted annualized ROAE was 8.34 percent for the nine months ended June 30, 2019.

"Our top line revenue increased despite the lower net growth in loans during the period.  Other aspects of operations were also positive, and we believe we are well positioned to execute our strategic plan through the remainder of fiscal 2019 and into 2020.  Our continued focus on client service remains constant and is a key driver in gathering customer relationships, fueling the business model advancement and our resulting performance," commented Anthony C. Weagley, President and Chief Executive Officer. 

Joseph D. Gangemi, Chief Financial Officer of the Company, added: "Liquidity remained elevated to fuel loan growth during the quarter and anticipated loan growth in the fourth fiscal quarter. While the large cash balances do have a dampening effect on margins, we expect liquidity to continue to remain elevated to fund current pipelines, we also anticipate a positive impact on margins with the investment of our cash into loans."

Linked Quarter Financial Ratios  
(unaudited)
           
             
As of or for the quarter ended : 6/30/19
  3/31/19
  12/31/18
  9/30/18
  6/30/18
   
Return on average assets (1)   0.88 %   0.70 %   0.74 %   1.02 %   0.85 %  
Return on average equity (1)   7.66 %   5.74 %   6.00 %   9.63 %   8.40 %  
Net interest margin (tax equivalent basis) (2)   2.54 %   2.67 %   2.65 %   2.85 %   2.75 %  
Loans / deposits ratio   106.52 %   106.82 %   110.70 %   117.62 %   114.46 %  
Shareholders' equity / total assets   11.03 %   11.37 %   12.02 %   10.72 %   10.25 %  
Efficiency ratio, non-GAAP (1)  (2)  (3)   56.9 %   57.6 %   48.1 %   58.3 %   52.9 %  
Book value per common share $17.98   $17.68   $17.45   $16.84   $16.42    

(1) Annualized.

(2) Information reconciling non-GAAP measures to GAAP measures is presented beginning on page 12 in this press release.

(3) Efficiency ratio is a non-GAAP financial measure and is defined as other expense, excluding certain non-core items, as a percentage of net interest income on a tax equivalent basis plus other income.

Linked Quarter Income Statement Highlights

   
Linked Quarter
Income Statement and Other Data  
(unaudited)
(in thousands, except share and per share data)
       
             
For the quarter ended: 6/30/19 3/31/19 12/31/18 9/30/18 6/30/18  
Net interest income $   7,461 $   7,249 $   6,947 $   7,109 $   6,976  
Provision for loan losses   56   870   1,453   125   589  
 Net interest income after provision for loan losses   7,405   6,379   5,494   6,984   6,387  
Other income   454   441   1,146   429   715  
Other expense   4,497   4,443   4,094   4,437   4,790  
Income before income tax expense   3,362   2,377   2,546   2,976   2,312  
Income tax expense   706   411   535   334   69  
Net income $   2,656 $   1,966 $   2,011 $   2,642 $   2,243  
Earnings per common share            
Basic $   0.35 $   0.26 $   0.27 $   0.41 $   0.35  
Diluted $   0.35 $   0.26 $   0.27 $   0.41 $   0.35  
Weighted average common shares outstanding          
Basic   7,671,623   7,667,518
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