Attached files
| file | filename |
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| 8-K - THE BANCORP, INC. FORM 8-K - Bancorp, Inc. | bancorp8k.htm |
Exhibit 99.1
The Bancorp, Inc. Reports First Quarter 2011 Financial Results
Wilmington, Delaware – April 26, 2011 - The Bancorp, Inc. ("Bancorp") (NASDAQ: TBBK), a financial holding company, today reported results for the quarter ended March 31, 2011.
Financial Highlights
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-
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Net income increased to $2.7 million in first quarter 2011 compared to $2.2 million in first quarter 2010, prior to $6.2 million of charges in 2010 related to the repayment of TARP and other TARP costs.
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-
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First quarter 2011 diluted earnings per share increased to $0.10, compared to $0.08 in first quarter 2010, prior to $6.2 million of charges in 2010 related to the repayment of TARP and other TARP costs.
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-
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Non-interest income, excluding security gains, increased to $7.8 million compared to $4.7 million in first quarter 2010, reflecting significant increases in prepaid and debit card income. Non-interest income excluding a $485,000 legal settlement in favor of the Bancorp in 2011, increased 55% between those periods. That increase was driven primarily by prepaid card income, which increased $1.9 million or 69% between those periods.
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Average loans and leases for first quarter 2011 totaled $1.6 billion, an increase of $112 million or 7% over first quarter 2010. Average securities for first quarter 2011 totaled $263 million, an increase of $102 million, or 63% over first quarter 2010.
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-
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Average deposits for first quarter 2011 totaled $2.7 billion, an increase of $645 million or 31% over first quarter 2010, while transaction accounts grew to 98% of total average deposits. The average cost of funds between those respective periods decreased to 0.41% from 0.70%.
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A successful stock offering was concluded during the quarter. Shareholders’ equity was increased by approximately $54.5 million to fund our continuing growth opportunities.
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Betsy Z. Cohen, Bancorp’s Chief Executive Officer, said, “Our net-interest income totaled $18.2 million in first quarter 2011, an increase of $1.9 million, or 12% over first quarter 2010. Larger loan and security balances and a lower cost of funds were the drivers behind the increase. Our core earnings for the quarter, as detailed below, increased $2.1 million over the prior year same quarter reflecting the increase in net interest income and the 69% increase in prepaid card income. Our SBA (Small Business Administration) program is moving forward, and we are carefully approving new franchisors. Our recent SBA PLP (Preferred Lending Program) designation should add momentum to the program’s growth.”
Financial Results
Bancorp reported net income available to common shareholders for the three months ended March 31, 2011 of $2.7 million or diluted earnings per share of $0.10, based on 28,058,333 weighted average shares, compared to a net loss available to common shareholders of $4.1 million or a loss per share of $0.15, based on 26,181,281 weighted average shares, for the three months ended March 31, 2010. Core operating earnings, a non-GAAP measure, increased to $8.9 million for the three months ended March 31, 2011 compared to $6.8 million for the three months ended March 31, 2010. The following is a reconciliation of core operating earnings to net income available to common shareholders (for the three month period):
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March 31,
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March 31,
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2011
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2010
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Net income (loss) available to common shareholders
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$ | 2,688 | $ | (4,056 | ) | |||
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Preferred stock dividend and accretion
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- | 6,242 | ||||||
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Income tax expense
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1,431 | 1,233 | ||||||
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Gains on sales of investment securities
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- | (750 | ) | |||||
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Other than temporary impairment of securities
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75 | - | ||||||
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Provision for loan and lease losses
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4,672 | 4,148 | ||||||
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Core operating earnings (1)
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$ | 8,866 | $ | 6,817 | ||||
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(1)
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As a supplement to GAAP, Bancorp has provided this non-GAAP performance result. The Bancorp believes that this non-GAAP financial measure is useful because it allows investors to assess its operating performance, specifically its overall earnings capacity. Other companies may calculate core earnings differently. Although this non-GAAP financial measure is intended to enhance investors’ understanding of Bancorp’s business and performance, it should not be considered, and is not intended to be, a substitute for GAAP.
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Capital Ratios
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Tier 1 capital
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Tier 1 capital
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Total capital
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to average
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to risk-weighted
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to risk-weighted
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assets ratio
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assets ratio
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assets ratio
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As of March 31, 2011
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The Company
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8.62 | % | 15.33 | % | 16.58 | % | ||||||
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The Bancorp Bank
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6.00 | % | 10.69 | % | 11.94 | % | ||||||
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"Well capitalized" institution (under FDIC regulations)
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5.00 | % | 6.00 | % | 10.00 | % | ||||||
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As of March 31, 2010
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The Company
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8.64 | % | 13.08 | % | 14.33 | % | ||||||
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The Bancorp Bank
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7.41 | % | 11.23 | % | 12.48 | % | ||||||
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"Well capitalized" institution (under FDIC regulations)
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5.00 | % | 6.00 | % | 10.00 | % | ||||||
Balance Sheet Summary
At March 31, 2011, Bancorp's total assets were $2.8 billion, an increase of $744 million or 36% over total assets at March 31, 2010. During that period, investments increased to $295 million, an increase of $117 million or 66%; loans increased to $1.6 billion, an increase of $109 million or 7%; and deposits increased to $2.5 billion, an increase of $669 million or 36%.
Conference Call Webcast
You may access the LIVE webcast of Bancorp's Quarterly Earnings Conference Call at 10:00 AM EDT Tuesday, April 26, 2011 by clicking on the webcast link on Bancorp's homepage at www.thebancorp.com. Or, you may dial 800.901.5248 using access code 21180968. You may listen to the replay of the webcast following the live call on Bancorp's investor relations website or telephonically until Tuesday, May 3, 2011 by dialing 888.286.8010, access code 97477604.
About Bancorp
The Bancorp, Inc. is a financial holding company that operates The Bancorp Bank, an FDIC-insured commercial bank that delivers a full array of financial services both directly and through private-label affinity programs nationwide. The Bancorp Bank’s regional community bank operations serve the needs of small and mid-size businesses and their principals in the Philadelphia-Wilmington region.
Forward Looking Statements
Statements in this earnings release regarding The Bancorp, Inc.’s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. These statements may be identified by the use of forward-looking terminology, including but not limited to the words “may,” “believe,” “will,” “expect,” “look,” “anticipate,” “estimate,” “continue,” or similar words. For further discussion of the risks and uncertainties to which these forward-looking statements may be subject, see The Bancorp, Inc.’s filings with the SEC, including the “Risk Factors” sections of The Bancorp Inc.’s filings. These risks and uncertainties could cause actual results to differ materially from those projected in the forward-looking statements. The forward-looking statements speak only as of the date of this presentation. The Bancorp, Inc. does not undertake to publicly revise or update forward-looking statements in this presentation to reflect events or circumstances that arise after the date of this presentation, except as may be required under applicable law.
The Bancorp, Inc. Contact
Andres Viroslav
215-861-7990
andres.viroslav@thebancorp.com
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The Bancorp, Inc.
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Financial highlights
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(unaudited)
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Three months ended
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Year ended
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March 31,
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December 31,
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2011
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2010
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2010
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(dollars in thousands except per share data)
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Condensed income statement
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Net interest income
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$ | 18,198 | $ | 16,280 | $ | 68,193 | ||||||
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Provision for loan and lease losses
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4,672 | 4,148 | 19,287 | |||||||||
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Non-interest income
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Gain on sales of investment securities
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- | 750 | 1,207 | |||||||||
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Other than temporary impairment of investment securities
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(75 | ) | - | (135 | ) | |||||||
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Other non-interest income
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7,820 | 4,744 | 19,524 | |||||||||
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Total non-interest income
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7,745 | 5,494 | 20,596 | |||||||||
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Non-interest expense
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Loss on other real estate owned
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52 | 20 | 22 | |||||||||
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Other non-interest expense
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17,100 | 14,187 | 61,726 | |||||||||
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Total non-interest expense
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17,152 | 14,207 | 61,748 | |||||||||
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Net income before income tax expense
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4,119 | 3,419 | 7,754 | |||||||||
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Income tax expense
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1,431 | 1,233 | 2,532 | |||||||||
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Net income
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2,688 | 2,186 | 5,222 | |||||||||
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Less preferred stock dividends
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- | (433 | ) | (433 | ) | |||||||
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Less preferred stock accretion
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- | (5,809 | ) | (5,809 | ) | |||||||
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Net income (loss) available to common shareholders
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$ | 2,688 | $ | (4,056 | ) | $ | (1,020 | ) | ||||
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Basic earnings (loss) per share
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$ | 0.10 | $ | (0.15 | ) | $ | (0.04 | ) | ||||
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Diluted earnings (loss) per share
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$ | 0.10 | $ | (0.15 | ) | $ | (0.04 | ) | ||||
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Weighted average shares – basic
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28,051,948 | 26,181,281 | 26,181,281 | |||||||||
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Weighted average shares – diluted
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28,058,333 | 26,181,281 | 26,181,281 | |||||||||
| Balance sheet |
March 31,
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December 31,
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September 30,
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March 31,
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2011
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2010
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2010
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2010
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Assets:
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Cash and cash equivalents
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Cash and due from banks
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$ | 223,420 | $ | 157,411 | $ | 164,948 | $ | 106,316 | ||||||||
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Interest bearing deposits
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630,524 | 314,908 | 584,857 | 232,117 | ||||||||||||
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Total cash and cash equivalents
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853,944 | 472,319 | 749,805 | 338,433 | ||||||||||||
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Investment securities, available-for-sale, at fair value
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273,643 | 231,165 | 249,342 | 156,191 | ||||||||||||
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Investment securities, held-to-maturity
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21,298 | 21,364 | 21,354 | 21,488 | ||||||||||||
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Loans, net of deferred costs
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1,636,253 | 1,619,195 | 1,590,507 | 1,527,691 | ||||||||||||
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Allowance for loan and lease losses
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(25,802 | ) | (24,063 | ) | (21,798 | ) | (20,357 | ) | ||||||||
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Loans, net of deferred costs
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1,610,451 | 1,595,132 | 1,568,709 | 1,507,334 | ||||||||||||
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Premises and equipment, net
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8,533 | 8,767 | 8,602 | 8,140 | ||||||||||||
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Accrued interest receivable
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8,807 | 8,878 | 8,396 | 7,589 | ||||||||||||
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Intangible assets, net
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8,754 | 9,005 | 9,255 | 9,755 | ||||||||||||
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Other real estate owned
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3,379 | 2,115 | 225 | 648 | ||||||||||||
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Deferred tax asset, net
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23,817 | 24,365 | 19,434 | 20,872 | ||||||||||||
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Other assets
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24,071 | 22,613 | 24,554 | 22,063 | ||||||||||||
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Total assets
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$ | 2,836,697 | $ | 2,395,723 | $ | 2,659,676 | $ | 2,092,513 | ||||||||
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Liabilities:
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Deposits
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Demand (non-interest bearing)
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$ | 1,412,656 | $ | 945,605 | $ | 1,402,538 | $ | 973,116 | ||||||||
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Savings, money market and interest checking
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1,105,226 | 975,973 | 1,001,959 | 875,511 | ||||||||||||
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Time deposits
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1,397 | 90,862 | 9,218 | 1,317 | ||||||||||||
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Time deposits, $100,000 and over
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11,830 | 11,657 | 8,672 | 12,339 | ||||||||||||
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Total deposits
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2,531,109 | 2,024,097 | 2,422,387 | 1,862,283 | ||||||||||||
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Securities sold under agreements to repurchase
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19,783 | 14,383 | 9,429 | 8,245 | ||||||||||||
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Short-term borrowings
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- | 87,000 | - | - | ||||||||||||
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Federal funds purchased
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- | 49,000 | - | - | ||||||||||||
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Accrued interest payable
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149 | 124 | 109 | 136 | ||||||||||||
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Subordinated debenture
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13,401 | 13,401 | 13,401 | 13,401 | ||||||||||||
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Other liabilities
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14,654 | 8,812 | 12,918 | 6,401 | ||||||||||||
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Total liabilities
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$ | 2,579,096 | $ | 2,196,817 | $ | 2,458,244 | $ | 1,890,466 | ||||||||
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Shareholders' equity:
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Preferred stock – authorized 5,000,000 shares, Series A, $0.01 par value; 0 shares issued and outstanding at March 31, 2011 and 2010;
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- | - | - | - | ||||||||||||
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Common stock - authorized, 50,000,000 shares of $1.00 par value; 33,196,281 and 26,181,281 shares issued and outstanding at March 31, 2011 and 2010, respectively
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33,196 | 26,181 | 26,181 | 26,181 | ||||||||||||
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Additional paid-in capital
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240,640 | 192,711 | 192,492 | 196,898 | ||||||||||||
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Accumulated deficit
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(15,507 | ) | (18,195 | ) | (20,236 | ) | (21,231 | ) | ||||||||
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Accumulated other comprehensive (loss) gain
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(728 | ) | (1,791 | ) | 2,995 | 199 | ||||||||||
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Total shareholders' equity
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257,601 | 198,906 | 201,432 | 202,047 | ||||||||||||
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Total liabilities and shareholders' equity
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$ | 2,836,697 | $ | 2,395,723 | $ | 2,659,676 | $ | 2,092,513 | ||||||||
Average balance sheet and net interest income
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Three months ended March 31, 2011
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Three months ended March 31, 2010
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(dollars in thousands)
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Average
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Average
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Average
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Average
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Assets:
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Balance
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Interest
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Rate
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Balance
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Interest
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Rate
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Interest-earning assets:
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Loans net of unearned discount
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$ | 1,627,928 | $ | 18,260 | 4.49 | % | $ | 1,518,631 | $ | 17,916 | 4.72 | % | ||||||||||||
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Leases - bank qualified*
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2,344 | 50 | 8.53 | % | - | - | ||||||||||||||||||
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Investment securities-taxable
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185,583 | 1,557 | 3.36 | % | 130,432 | 1,308 | 4.01 | % | ||||||||||||||||
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Investment securities-nontaxable*
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77,592 | 1,011 | 5.21 | % | 30,855 | 587 | 7.61 | % | ||||||||||||||||
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Interest bearing deposits at Federal Reserve Bank
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833,085 | 515 | 0.25 | % | 472,388 | 351 | 0.30 | % | ||||||||||||||||
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Net interest-earning assets
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2,726,532 | 21,393 | 3.14 | % | 2,152,306 | 20,162 | 3.75 | % | ||||||||||||||||
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Allowance for loan and lease losses
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(24,811 | ) | (19,821 | ) | ||||||||||||||||||||
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Other assets
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286,553 | 201,340 | ||||||||||||||||||||||
| $ | 2,988,274 | $ | 2,333,825 | |||||||||||||||||||||
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Liabilities and Shareholders' Equity:
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Deposits:
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Demand (non-interest bearing)**
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$ | 1,647,682 | $ | 425 | 0.10 | % | $ | 950,319 | $ | 219 | 0.09 | % | ||||||||||||
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Interest bearing deposits
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Interest checking
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714,846 | 1,279 | 0.72 | % | 539,757 | 1,924 | 1.43 | % | ||||||||||||||||
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Savings and money market
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321,472 | 797 | 0.99 | % | 544,758 | 1,182 | 0.87 | % | ||||||||||||||||
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Time
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46,507 | 104 | 0.89 | % | 50,270 | 133 | 1.06 | % | ||||||||||||||||
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Total interest bearing deposits
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1,082,825 | 2,180 | 0.81 | % | 1,134,785 | 3,239 | 1.14 | % | ||||||||||||||||
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Total deposits
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2,730,507 | 2,605 | 0.38 | % | 2,085,104 | 3,458 | 0.66 | % | ||||||||||||||||
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Short-term borrowings
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3,022 | 3 | 0.40 | % | 3,183 | 5 | 0.63 | % | ||||||||||||||||
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Repurchase agreements
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17,030 | 16 | 0.38 | % | 4,774 | 7 | 0.59 | % | ||||||||||||||||
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Subordinated debt
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13,401 | 215 | 6.42 | % | 13,401 | 215 | 6.42 | % | ||||||||||||||||
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Net interest bearing liabilities
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1,116,278 | 2,414 | 0.87 | % | 1,156,143 | 3,466 | 1.20 | % | ||||||||||||||||
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Total cost of funds
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2,763,960 | 2,839 | 0.41 | % | 2,106,462 | 3,685 | 0.70 | % | ||||||||||||||||
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Other liabilities
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9,435 | 12,658 | ||||||||||||||||||||||
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Total liabilities
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2,773,395 | 2,119,120 | ||||||||||||||||||||||
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Shareholders' equity
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214,879 | 214,705 | ||||||||||||||||||||||
| $ | 2,988,274 | $ | 2,333,825 | |||||||||||||||||||||
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Net interest income on tax equivalent basis*
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$ | 18,554 | $ | 16,477 | ||||||||||||||||||||
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Tax equivalent adjustment
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356 | 197 | ||||||||||||||||||||||
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Net interest income
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$ | 18,198 | $ | 16,280 | ||||||||||||||||||||
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Net interest margin *
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2.72 | % | 3.06 | % | ||||||||||||||||||||
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* Full taxable equivalent basis to be comparable to the interest income of all other categories, using a 34% statutory tax rate
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** Interest includes fees paid to affinity groups.
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Allowance for loan and lease losses:
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Three months ended
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For year ended
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March 31,
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March 31,
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December 31,
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2011
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2010
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2010
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Balance in the allowance for loan and lease losses at beginning of period
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$ | 24,063 | $ | 19,123 | $ | 19,123 | ||||||
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Loans charged-off:
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Commercial
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106 | 2,728 | 13,513 | |||||||||
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Construction
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2,143 | - | - | |||||||||
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Lease financing
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- | - | 3 | |||||||||
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Residential mortgage
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31 | 223 | 1,254 | |||||||||
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Consumer
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668 | 44 | 618 | |||||||||
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Total
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2,948 | 2,995 | 15,388 | |||||||||
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Recoveries:
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Commercial
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14 | 79 | 279 | |||||||||
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Construction
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1 | 1 | 4 | |||||||||
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Lease financing
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- | - | 10 | |||||||||
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Residential mortgage
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- | - | 742 | |||||||||
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Consumer
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- | 1 | 6 | |||||||||
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Total
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15 | 81 | 1,041 | |||||||||
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Net charge-offs
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2,933 | 2,914 | 14,347 | |||||||||
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Provision charged to operations
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4,672 | 4,148 | 19,287 | |||||||||
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Balance in allowance for loan and lease losses at end of period
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$ | 25,802 | $ | 20,357 | $ | 24,063 | ||||||
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Net charge-offs/average loans
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0.18 | % | 0.19 | % | 0.92 | % | ||||||
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Loan portfolio:
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March 31,
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December 31,
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September 30,
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March 31,
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2011
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2010
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2010
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2010
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Commercial
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$ | 430,081 | $ | 441,799 | $ | 409,697 | $ | 413,361 | ||||||||
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Commercial mortgage (1)
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601,046 | 580,780 | 580,491 | 557,713 | ||||||||||||
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Construction
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202,105 | 203,120 | 206,551 | 206,275 | ||||||||||||
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Total commercial loans
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1,233,232 | 1,225,699 | 1,196,739 | 1,177,349 | ||||||||||||
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Direct financing leases
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107,624 | 103,289 | 103,278 | 81,904 | ||||||||||||
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Residential mortgage
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94,682 | 93,004 | 93,833 | 89,005 | ||||||||||||
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Consumer loans and others
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197,876 | 194,320 | 193,968 | 177,456 | ||||||||||||
| 1,633,414 | 1,616,312 | 1,587,818 | 1,525,714 | |||||||||||||
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Unamortized costs (fees)
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2,839 | 2,883 | 2,689 | 1,977 | ||||||||||||
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Total loans, net of unamortized fees and costs
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$ | 1,636,253 | $ | 1,619,195 | $ | 1,590,507 | $ | 1,527,691 | ||||||||
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Supplemental loan data:
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Construction 1-4 family
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$ | 96,240 | $ | 100,689 | $ | 100,848 | $ | 104,213 | ||||||||
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Construction commercial, acquisition and development
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105,865 | 102,431 | 105,703 | 102,062 | ||||||||||||
| $ | 202,105 | $ | 203,120 | $ | 206,551 | $ | 206,275 | |||||||||
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(1) At March 31, 2011 our owner-occupied loans amounted to $136 million, or 22.7% of commercial mortgages.
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March 31,
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December 31,
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September 30,
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March 31,
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2011
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2010
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2010
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2010
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Asset quality ratios:
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Nonperforming loans to total loans (1)
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1.05 | % | 1.08 | % | 1.51 | % | 1.44 | % | ||||||||
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Nonperforming assets to total assets (1)
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0.73 | % | 0.82 | % | 0.91 | % | 1.08 | % | ||||||||
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Allowance for loan and lease losses to total loans
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1.58 | % | 1.49 | % | 1.37 | % | 1.33 | % | ||||||||
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Nonaccrual loans
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$ | 14,228 | $ | 15,298 | $ | 19,640 | $ | 17,863 | ||||||||
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Total nonperforming loans
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14,228 | 15,298 | 19,640 | 17,863 | ||||||||||||
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Other real estate owned
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3,379 | 2,115 | 225 | 648 | ||||||||||||
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Total nonperforming assets
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$ | 17,607 | $ | 17,413 | $ | 19,865 | $ | 18,511 | ||||||||
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Loans 90 days past due still accruing interest
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$ | 3,028 | $ | 2,219 | $ | 4,352 | $ | 4,071 | ||||||||
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(1) Nonperforming loans are defined as nonaccrual loans and restructure loans. Loans 90 days past due and still accruing interest are also included in these ratios.
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Three months ended
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Year ended
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March 31,
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December 31,
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December 31,
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2011
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2010
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2010
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2010
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Selected operating ratios:
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Return on average assets
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0.36 | % | 0.37 | % | 0.34 | % | 0.23 | % | ||||||||
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Return on average equity
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5.07 | % | 4.07 | % | 4.01 | % | 2.45 | % | ||||||||
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Net interest margin
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2.72 | % | 3.06 | % | 3.36 | % | 3.28 | % | ||||||||
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Efficiency ratio
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66.11 | % | 67.58 | % | 69.37 | % | 70.52 | % | ||||||||
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Book value per share
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$ | 7.76 | $ | 7.72 | $ | 7.60 | $ | 7.60 | ||||||||