 HELENA, Montana, July 28, 2020 GLOBE NEWSWIRE -- Eagle Bancorp Montana, Inc. NASDAQ: EBMT, the Company, Eagle, the holding company of Opportunity Bank of Montana, today reported net income in the second quarter of 2020 increased 78.1 to 5.7 million, or 0.84 per diluted share, compared to 3.2 million, or 0.51 per diluted share, in the second quarter a year ago, reflecting the high level of contributions from mortgage banking and gains from sale of loans. Net income increased 46.0 when compared to 3.9 million, or 0.57 per diluted share, in the preceding quarter. In the first six months of 2020, net income increased 118.1 to 9.7 million, or 1.41 per diluted share, compared to 4.4 million, or 0.69 per diluted share, in the first six months of 2019.Eagles board of directors increased its quarterly cash dividend by 2.7 to 0.0975 per share on July 23, 2020. The dividend will be payable September 4, 2020 to shareholders of record August 14, 2020. The current annualized dividend yield is 2.50 based on recent market prices.Higher mortgage banking operations due to the historically low interest rate environment contributed to record second quarter earnings, said Peter J. Johnson, President and CEO. While our second quarter operating performance was strong, we continued to see the impact of the COVID-19 pandemic and its consequences on our Montana communities. When Montana entered its Phase 2 reopening June 1, 2020, we reopened our branch lobbies; however, due to increased COVID-19 cases throughout the state, we closed some branch lobbies again on July 10. In addition, effective July 16 Montana implemented a mandatory mask directive for indoor areas open to the public. To keep our employees, and communities safe and healthy, we have made accommodations for employees to work from home when feasible while keeping drive-ups open and scheduling in-person appointments. We are closely monitoring borrowers and businesses we service and are providing debt service relief for those who have been impacted. COVID-19 Preparations as of June 30, 2020: Industry Exposure: Restaurants, lodging, schools, childcare, health care and entertainment industries, among others, have seen a dramatic change in revenues for their business. Eagles 5 largest concentrations by industry, as a percentage of total loans, are lessors of nonresidential buildings 10.0, lessors of residential buildings 5 units 6.8, construction and related 8.0, farm and ranch related 8.2 and hotels 3.4. Loan Accommodations: The bank has offered multiple accommodation options to its clients, including 90-day deferrals, forbearances and interest only payments. As of June 30, 2020, there were 222 loans totaling 77.7 million deferring payments for 90 days, primarily from the lessors of nonresidential buildings, hotels, and restaurants and bars industries. Approximately 93 borrowers, representing 48.0 million in loans, have been approved for up to 6-months interest only payments. There have been approximately 121 forbearances approved for residential mortgage loans, of which 104 are sold and serviced. Utilization of credit lines were 83.4 at the end of the quarter, compared to 84.6 at the end of the previous quarter, which aligns with historical usage rates. Additionally, the Bank halted deposit fees associated with early withdrawal requests. Eagle will continue to closely monitor each of its loans for risk. SBA Paycheck Protection Program PPP: Congress passed the Coronavirus Aid, Relief, and Economic Security Act CARES Act providing economic relief for the country, including the Small Business Administration Paycheck Protection Program to fund short-term loans for small businesses. Eagle began taking loan applications from its small business clients immediately after the program was implemented, and as of June 30, 2020, had helped 742 of its customers receive 44.9 million in SBA PPP loans. Provision for Loan Losses: Due to the economic slowdown resulting from the COVID-19 pandemic, Eagle increased its provision for loan losses to 1.2 million for the quarter ended June 30, 2020, which is the largest provision ever taken during a quarter. Eagle had net loan recoveries of 23,000 during the quarter and approximately 450,000 of the provisions were related to loan growth. Additionally, management determined that with the closing of many businesses and resulting decline in business cash-flows, an increase in the related economic factors included in the allowance for loan losses analysis and loan loss reserves of approximately 777,000 was warranted. Liquidity Changes: Through the quarter ended June 30, 2020, the liquidity level remained consistent with the prior quarters. Eagle used Federal Reserves Paycheck Protection Program Liquidity Facility PPPLF as a partial source of funding for its SBA PPP loans. Technology Updates and Unusual Expenses: To accommodate the immediate need for personnel to work from home, Eagle purchased additional laptop computers and docking stations. There were also extra supplies and equipment needed to provide each location with a clean, disinfected and safer work environment. Special staff accommodations related to additional protection and comfort were also experienced. These expenses were incurred during the second quarter of 2020 and total approximately 200,000.Recent EventsOn June 10, 2020, Eagle issued 15 million in subordinated notes to certain qualified institutional accredited investors through a private placement offering. The net cash proceeds from the sale of the subordinated notes was approximately 14.7 million, and the subordinated notes are expected to qualify as Tier 2 capital for regulatory purposes. Eagle intends to use the net proceeds from the offering for general corporate purposes. In July the Company redeemed 10 million of 6.75 subordinated notes due 2025.AcquisitionsOn January 1, 2020, Eagle completed its acquisition of Western Holding Company of Wolf Point, and its wholly owned subsidiary, Western Bank of Wolf Point, in a transaction valued at approximately 15.0 million. In the transaction, Eagle acquired one retail bank branch and approximately 104 million in assets, 87 million in deposits and 43 million in gross loans.On January 1, 2019, Eagle completed its acquisition of Big Muddy Bancorp, Inc. and its wholly owned subsidiary, The State Bank of Townsend, located in Townsend, Montana, which added approximately 108 million in assets, 93 million in deposits and 89 million in gross loans.On January 31, 2018, Eagle completed its acquisition of TwinCo Inc., which added approximately 96 million in assets, 82 million in deposits and 55 million in gross loans.Second Quarter 2020 Highlights at or for the three-month period ended June 30, 2020, except where noted Net income increased 76.6 to 5.7 million, or 0.84 per diluted share, in the second quarter of 2020, compared to 3.2 million, or 0.51 per diluted share, in the second quarter of 2019, and increased 46.0 compared to 3.9 million, or 0.57 per diluted share in the preceding quarter. Annualized return on average assets was 1.89. Annualized return on average equity was 16.66. Net interest margin NIM was 3.85 in the second quarter of 2020, compared to 4.04 in the preceding quarter, and 4.31 in the second quarter a year ago. Revenues net interest income before the provision for loan losses, plus non-interest income increased 28.4 to a record 24.1 million in the second quarter of 2020, compared to 18.8 million in the previous quarter, and increased 58.7 compared to 15.2 million in the second quarter a year ago. Purchase discount on loans from the Western Holding Company of Wolf Point portfolio was 1.2 million at January 1, 2020, the acquisition date of which 918,000 remained as of June 30, 2020. Purchase discount on loans from the Big Muddy Bancorp, Inc. portfolio was 2.8 million at January 1, 2019, the acquisition date of which 1.0 million remained as of June 30, 2020. Purchase discount on loans from the TwinCo, Inc. portfolio was 1.8 million at January 31, 2018, the acquisition date of which 500,000 remained as of June 30, 2020. The accretion of the loan purchase discount into loan interest income from the Western Holding Company of Wolf Point, the Big Muddy Bancorp, Inc. and the TwinCo, Inc. transactions was 357,000 in the second quarter of 2020, compared to interest accretion on purchased loans from the three acquisitions of 558,000 in the preceding quarter. The allowance for loan losses represented 124.6 of nonperforming loans at June 30, 2020, compared to 206.4 a year earlier. Total loans increased 11.7 to 840.8 million at June 30, 2020, compared to 752.4 million a year earlier. Total deposits increased 27.7 to 955.4 million at June 30, 2020, compared to 748.4 million a year ago. Eagle remained well capitalized with a tangible common shareholders equity ratio of 9.64 at June 30, 2020. Increased its quarterly cash dividend by 2.7 to 0.0975 per share.Balance Sheet Results Total assets increased 23.9 to 1.25 billion at June 30, 2020, compared to 1.01 billion a year ago, in large part due to the Western Holding Company of Wolf Point acquisition. Total assets grew 7.8 from 1.16 billion three months earlier, primarily due to the addition of SBA PPP loans and the related deposit inflows. Our recent acquisitions continue to deliver strong balance sheet growth, with total loans increasing 11.7 year-over-year, resulting in solid overall expansion of the loan portfolio, said Johnson. Additionally, loans increased 2.3 over the preceding quarter, largely due to the addition of 44.9 million in SBA PPP loans during the quarter. Total loans were 840. 