First Federal Bancshares Posts Positive 2Q Income

First Federal Bancshares of Arkansas Inc. posted second-quarter net income of $637,000, up from a loss of $937,000 for the same period a year earlier.

First Federal Bancshares of Harrison is the holding company for publicly traded thrift, First Federal Bank.

Earnings per diluted common share were 9 cents, up from a loss of 24 cents per share for the second quarter of 2009. Stockholders' equity per common share as of June 30 was $5.82, the company said.
In April, First Federal revised its calendar 2009 losses to $46.7 million and it became public that the Office of Thrift Supervision had issued a cease-and-desist order, which requires the company to raise its capital ratios.

The company said this year it has paid back about $39 million it had borrowed from the Federal Home Loan Bank in Dallas and sold about $12.2 million in "real estate owned" properties it acquired through foreclosure or deed in lieu of foreclosures.

The bank sold about $7.6 million in REO property during the second quarter.

"We believe, like many economists, that we will not see a double dip recession, but the recovery will be much slower than previously projected," said CEO Larry J. Brandt in the company's earnings statement. "Our capital levels continue to improve but we still plan to pursue later this year additional measures to increase our capital levels to permit potential growth and expansion of our franchise."
FFB had $82.4 million in nonperforming assets as of June 30, about 12 percent of its total portfolio, which is up from $78 million reported at the end of 2009.

The company's assets were $678 million on June 30, down from $731 million at the end of 2009.
Shares of First Federal (Nasdaq: FFBH) were trading at $1.80 on Tuesday, unchanged from the close on Monday.