Attached files
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| 8-K - CURRENT REPORT - FIRST UNITED CORP/MD/ | f8k011110_firstunited.htm |
Exhibit
99.1
January 11, 2010
Dear
Fellow Shareholder:
I wanted
to take this opportunity to write to you. 2009 will certainly go down in history
as one of the most challenging years ever for the banking industry. Your
Company, like thousands of others across the country, felt a significant impact
from this recession.
I am enclosing, for your review, a
recent press release which spoke to this, and to our most recently declared
dividend. The essence of the release was the decision to cut the quarterly
dividend on the common stock from $0.20 per share to $0.10 per share. I can tell
you that this was an incredibly difficult decision for your Board. With some
deterioration of credit quality in our loan portfolio, coupled with persistent
charges in our investment portfolio, there was a desire on the part of your
Board to preserve capital. For more detail on these matters, please review our
most recent Quarterly Report on Form 10-Q that was filed with the Securities and
Exchange Commission. Of equal concern was your Board’s recognition that many of
you rely on the dividend as part of your budget. What emerged from the Board’s
deliberations was a decision, based on today’s circumstances, to find a balance
between taking the actions necessary to preserve sufficient capital and
providing a dividend. The Board believes this result is in the best interests of
the Company and, thus, you our shareholder.
While buffeted by these extraordinary
events, we continue to be encouraged by the strength of our core earnings. By
this, I mean the earnings your Company derives from what we earn on our loans
and investments, less the amount we pay our depositors and other funding
sources. We continue to see gains in core earnings year after year, as well as
through the third quarter of 2009. Sales in our trust department and through our
insurance area have been excellent through the third fiscal quarter of 2009. As
the markets for these products strengthen, we hope to see the resumption of
income growth for these two important fee income lines of business.
We believe our outlook for the future
is positive. Yes, 2009 was the most challenging year in nearly a century for
your Company. And, yes, we expect that during 2010 we will have some bumps in
the road as well. As the economy slowly expands, however, we anticipate a
renewed strength in your Company, and a return to our historically strong
financial performance.
Sincerely,
/s/ William B. Grant
William B. Grant
Chairman, President and
Chief Executive Officer
Portions of this letter
contain “forward-looking statements” within the meaning of The Private
Securities Litigation Reform Act of 1995. Statements that are not historical in
nature, including those that include the words “anticipate”, “estimate”,
“should”, “expect”, “believe”, “intend”, and similar expressions, are based on
current expectations, estimates and projections of the Company, and they are not
guarantees of future performance. Whether actual results will conform to
expectations and predictions is subject to known and unknown risks and
uncertainties, and there can be no assurance that the actual results anticipated
will be realized, or if substantially realized, will have the expected
consequences on the Company’s business or operations. These and other risks are
discussed in detail in the periodic reports that the Company files with the
Securities and Exchange Commission.
P.O Box 9 Oakland MD 21550-0009 Telephone ((888)
692-2654
FIRST UNITED CORPORATION
19 S. Second Street Oakland, MD
21550
FOR IMMEDIATE RELEASE
Date: December 17, 2009
Contact: Carrisa Rodeheaver
301-533-2362 Fax 301-334-1421
FIRST
UNITED CORPORATION ANNOUNCES FOURTH QUARTER DIVIDEND
Oakland, Maryland, December 17,
2009 -- The Board of Directors of First United Corporation
(NASDAQ: FUNC), the parent company of First United Bank & Trust,
announced that it has reduced the quarterly cash dividend on its common stock
for the fourth quarter of 2009 to $.10 per share from $.20 per share for the
third quarter. The fourth quarter dividend will be paid on February
1, 2010 to shareholders of record as of January 13, 2010. The
reduction in the quarterly cash dividend should, if it remains at its present
level, allow the Company to retain approximately $2.5 million in additional
common equity per year.
“While
regrettable, our Board’s decision underscores its commitment to preserving a
strong balance sheet as the Company, and indeed the nation, navigate through
this difficult economic cycle,” said William B. Grant, Chairman and CEO of First
United. “Core earnings remain strong for the Company, but bottom-line
earnings have been negatively impacted by challenges in the loan portfolio and
certain securities in the investment portfolio. The Company’s capital
remains stable, and exceeds the regulatory requirements to be considered “well
capitalized”. The Board clearly understands the importance of the
dividend to many of the Company’s long-term shareholders. Today’s
action, in light of today’s economic and market conditions, strikes a balance
between this need and efforts to conserve shareholder equity.”
This
press release contains forward-looking statements within the meaning of The
Private Securities Litigation Reform Act of 1995. Readers should be
aware of the speculative nature of “forward-looking
statements”. Statements that are not historical in nature, including
those that include the words “anticipate”, “estimate”, “should”, “expect”,
“believe”, “intend”, and similar expressions, are based on current expectations,
estimates and projections of First United Corporation, and they are not
guarantees of future performance. Whether actual results will conform
to expectations and predictions is subject to known and unknown risks and
uncertainties. Consequently, all of the forward-looking statements
made herein are qualified by these cautionary statements, and there can be no
assurance that the actual results anticipated will be realized, or if
substantially realized, will have the expected consequences on First United
Corporation’s business or operations. These and other risks are
discussed in detail in the periodic reports that First United Corporation files
with the Securities and Exchange Commission.
About
First United Corporation
First
United Corporation operates one full-service commercial bank, First United Bank
& Trust. The Bank has a network of community offices in Garrett,
Allegany, Washington, and Frederick Counties in Maryland, as well as Mineral,
Hardy, Berkeley and Monongalia Counties in West Virginia. First United’s website
can be located at www.mybank4.com. As of
September 30, 2009, the Corporation posted assets of $1.68 billion.