Attached files
| file | filename |
|---|---|
| 8-K - THE BANCORP, INC. FORM 8-K - Bancorp, Inc. | bancorp8k.htm |
Exhibit 99.1
The Bancorp, Inc. Reports Fourth Quarter and Fiscal 2016 Financial Results
Wilmington, DE – February 9, 2017 – The Bancorp, Inc. ("The Bancorp") (NASDAQ: TBBK), a financial holding company, today reported financial results for fourth quarter and fiscal 2016.
Highlights
| |
Net interest income increased 34% to $25.0 million for the quarter ended December 31, 2016 compared to $18.6 million for the quarter ended December 31, 2015. Year over year, net interest income increased 29% to $90.0 million from $69.9 million.
|
| |
Net interest margin increased to 2.84% for the quarter ended December 31, 2016 compared to 2.52% for the quarter ended December 31, 2015. Year over year, the net interest margin was 2.74% compared to 2.37%.
|
| |
Loans, excluding loans held for sale, increased 14% to $1.23 billion at December 31, 2016 compared to $1.08 billion at December 31, 2015.
|
| |
Direct lease financing increased 50% to $346.6 million from $231.5 million at December 31, 2015.
|
| |
Small Business Administration ("SBA") loans increased 20% to $369.8 million from $307.1 million at December 31, 2015.
|
| |
Security backed lines of credit ("SBLOC") increased 9% to $630.4 million from $575.9 million at December 31, 2015.
|
| |
Prepaid card fee income increased 2% to $12.0 million for the quarter ended December 31, 2016 from $11.7 million for the quarter ended December 31, 2015. Year over year, prepaid card fee income increased 8% to $51.3 million.
|
| |
Gross dollar volume on prepaid cards ("GDV") (1) increased 8% to $10.6 billion for Q4 2016 from $9.8 billion for Q4 2015. Year over year, GDV increased over 12%.
|
| |
Assets held for sale from discontinued operations decreased 38% from $583.9 million at December 31, 2015 to $360.7 million at December 31, 2016.
|
| |
The rate on our average deposits and interest bearing liabilities of $3.88 billion in Q4 2016 was 0.30% with a rate of 0.14% for $1.86 billion of average prepaid card deposits.
|
| |
The $1.86 billion of average Q4 2016 prepaid card deposits, which are among the lowest cost of our deposits, reflected a 16% increase over fourth quarter 2015.
|
| |
Book value per common share at December 31, 2016 of $5.40 per share. The Bancorp and its subsidiary, The Bancorp Bank, remain well capitalized.
|
(1) Gross dollar volume represents the total dollar amount spent on prepaid and debit cards issued by The Bancorp.
The Bancorp reported a net loss of $29.0 million, or $0.52 loss per diluted share, for the quarter ended December 31, 2016 compared to net income of $18.6 million, or $0.49 income per diluted share for the quarter ended December 31, 2015. Net loss from continuing operations for the quarter ended December 31, 2016 was $24.0 million or a loss of $0.43 per diluted share compared to net income from continuing operations of $17.3 million or income of $0.46 per diluted share for the quarter ended December 31, 2015. Loss from continuing operations does not include any income which may result from the reinvestment of the proceeds from sales of the remaining assets in The Bancorp's discontinued operations. Tier one capital to assets, tier one capital to risk-weighted assets, total capital to risk-weighted assets and common equity-tier 1 ratios were 7.06%, 13.84%, 14.13% and 13.84% compared to well capitalized minimums of 5%, 8%, 10% and 6.5%.
1
Damian Kozlowski, The Bancorp's Chief Executive Officer, said, "Discontinued operations and Walnut Street were reevaluated with updated values, which resulted in a significant charge during the fourth quarter. We've reviewed the related loan processes and enhanced related governance. A commercial credit, in the discontinued loan portfolio, was impacted by suspected fraud leading to a write-down and loss in discontinued operations. We've added additional details in this release on our credits from discontinued operations including a chart detailing the types of assets and other related information. Our goal, as stated before, is to reduce risk in the portfolios and complete an orderly wind-down with the least amount of future volatility. Our continuing operations results, excluding the charge to Walnut Street which resulted from the 2014 financing of the sale of certain discontinued operations loans, showed improvement this quarter. This improvement reflected the elimination of the BSA lookback expense which terminated in the prior quarter. It also reflected continuing revenue growth, while expense cuts and restructuring are also beginning to have an impact on profitability. While certain of the expense cuts are not immediate, we have targeted total 2017 expense reductions of $20 million."
Conference Call Webcast
You may access the LIVE webcast of The Bancorp's Quarterly Earnings Conference Call at 8:00 AM ET Friday, February 10, 2017 by clicking on the webcast link on Bancorp's homepage at www.thebancorp.com. Or, you may dial 844.775.2543, access code 51403334. You may listen to the replay of the webcast following the live call on The Bancorp's investor relations website or telephonically until Friday, February 17, 2017 by dialing 855.859.2056, access code 51403334.
About The Bancorp
The Bancorp, Inc. (NASDAQ: TBBK) is dedicated to serving the unique needs of non-bank financial service companies, ranging from entrepreneurial start-ups to those on the Fortune 500. The company's chief financial institution, The Bancorp Bank (Member FDIC, Equal Housing Lender), has been repeatedly recognized in the payments industry as the Top Issuer of Prepaid Cards (US), a top merchant sponsor bank, and a top ACH originator. Specialized lending distinctions include National Preferred SBA Lender, a leading provider of securities-backed lines of credit, and one of the few bank-owned commercial leasing groups in the nation. For more information please visit www.thebancorp.com.
Forward-Looking Statements
Statements in this earnings release regarding Bancorp'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 Bancorp's filings with the SEC, including the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of those 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 press release. The Bancorp does not undertake to publicly revise or update forward-looking statements in this press release 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
aviroslav@thebancorp.com
2
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The Bancorp, Inc.
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||||||||||||||||
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Financial highlights
|
||||||||||||||||
|
(unaudited)
|
||||||||||||||||
|
Three months ended
|
Year ended
|
|||||||||||||||
|
December 31,
|
December 31,
|
|||||||||||||||
|
Condensed income statement
|
2016
|
2015
|
2016
|
2015
|
||||||||||||
|
(dollars in thousands except per share data)
|
||||||||||||||||
|
Net interest income
|
$
|
24,978
|
$
|
18,582
|
$
|
89,966
|
$
|
69,931
|
||||||||
|
Provision for loan and lease losses
|
1,550
|
300
|
3,360
|
2,100
|
||||||||||||
|
Non-interest income
|
||||||||||||||||
|
Service fees on deposit accounts
|
1,789
|
1,889
|
5,124
|
7,468
|
||||||||||||
|
Card payment and ACH processing fees
|
1,343
|
1,489
|
5,526
|
5,731
|
||||||||||||
|
Prepaid card fees
|
11,993
|
11,744
|
51,326
|
47,496
|
||||||||||||
|
Gain (loss) on sale of loans
|
2,092
|
3,333
|
2,901
|
10,080
|
||||||||||||
|
Gain on sale of investment securities
|
40
|
14,497
|
3,171
|
14,435
|
||||||||||||
|
Gain on sale of health savings portfolio
|
-
|
33,531
|
-
|
33,531
|
||||||||||||
|
Change in value of investment in unconsolidated entity
|
(24,720
|
)
|
(1,412
|
)
|
(37,033
|
)
|
1,729
|
|||||||||
|
Leasing income
|
551
|
564
|
2,007
|
2,291
|
||||||||||||
|
Debit card income
|
202
|
253
|
-
|
1,611
|
||||||||||||
|
Affinity fees
|
1,056
|
967
|
4,563
|
3,358
|
||||||||||||
|
Other non-interest income
|
508
|
3,412
|
5,401
|
5,337
|
||||||||||||
|
Total non-interest income
|
(5,146
|
)
|
70,267
|
42,986
|
133,067
|
|||||||||||
|
Non-interest expense
|
||||||||||||||||
|
Bank Secrecy Act and lookback consulting expenses
|
5
|
14,801
|
29,081
|
41,444
|
||||||||||||
|
Other non-interest expense
|
42,123
|
44,198
|
169,492
|
152,644
|
||||||||||||
|
Total non-interest expense
|
42,128
|
58,999
|
198,573
|
194,088
|
||||||||||||
|
Income (loss) from continuing operations before income tax expense
|
(23,846
|
)
|
29,550
|
(68,981
|
)
|
6,810
|
||||||||||
|
Income tax expense (benefit)
|
153
|
12,267
|
(15,171
|
)
|
1,450
|
|||||||||||
|
Net income (loss) from continuing operations
|
(23,999
|
)
|
17,283
|
(53,810
|
)
|
5,360
|
||||||||||
|
Net income (loss) from discontinued operations, net of tax
|
(5,044
|
)
|
1,336
|
(42,953
|
)
|
8,072
|
||||||||||
|
Net income (loss) available to common shareholders
|
$
|
(29,043
|
)
|
$
|
18,619
|
$
|
(96,763
|
)
|
$
|
13,432
|
||||||
|
Net income (loss) per share from continuing operations - basic
|
$
|
(0.43
|
)
|
$
|
0.46
|
$
|
(1.21
|
)
|
$
|
0.14
|
||||||
|
Net income (loss) per share from discontinued operations - basic
|
$
|
(0.09
|
)
|
$
|
0.03
|
$
|
(0.96
|
)
|
$
|
0.21
|
||||||
|
Net income (loss) per share - basic
|
$
|
(0.52
|
)
|
$
|
0.49
|
$
|
(2.17
|
)
|
$
|
0.35
|
||||||
|
Net income (loss) per share from continuing operations - diluted
|
$
|
(0.43
|
)
|
$
|
0.46
|
$
|
(1.21
|
)
|
$
|
0.14
|
||||||
|
Net income (loss) per share from discontinued operations - diluted
|
$
|
(0.09
|
)
|
$
|
0.03
|
$
|
(0.96
|
)
|
$
|
0.21
|
||||||
|
Net income (loss) per share - diluted
|
$
|
(0.52
|
)
|
$
|
0.49
|
$
|
(2.17
|
)
|
$
|
0.35
|
||||||
|
Weighted average shares - basic
|
55,419,204
|
37,759,975
|
44,567,357
|
37,755,588
|
||||||||||||
|
Weighted average shares - diluted
|
55,790,543
|
37,813,345
|
44,776,138
|
38,074,218
|
||||||||||||
|
(a) For loss periods the weighted averages shares - basic is used in both the basic and diluted computations.
|
||||||||||||||||
3
|
Balance sheet
|
December 31,
|
September 30,
|
June 30,
|
December 31,
|
||||||||||||
|
2016
|
2016
|
2016
|
2015
|
|||||||||||||
|
(dollars in thousands)
|
||||||||||||||||
|
Assets:
|
||||||||||||||||
|
Cash and cash equivalents
|
||||||||||||||||
|
Cash and due from banks
|
$
|
4,127
|
$
|
4,061
|
$
|
4,006
|
$
|
7,643
|
||||||||
|
Interest earning deposits at Federal Reserve Bank
|
955,733
|
312,605
|
528,094
|
1,147,519
|
||||||||||||
|
Securities sold under agreements to resell
|
39,199
|
39,463
|
39,360
|
-
|
||||||||||||
|
Total cash and cash equivalents
|
999,059
|
356,129
|
571,460
|
1,155,162
|
||||||||||||
|
Investment securities, available-for-sale, at fair value
|
1,248,613
|
1,334,927
|
1,328,693
|
1,070,098
|
||||||||||||
|
Investment securities, held-to-maturity
|
93,467
|
93,495
|
93,537
|
93,590
|
||||||||||||
|
Loans held for sale, at fair value
|
663,140
|
562,957
|
441,593
|
489,938
|
||||||||||||
|
Loans, net of deferred fees and costs
|
1,222,911
|
1,198,237
|
1,182,106
|
1,078,077
|
||||||||||||
|
Allowance for loan and lease losses
|
(6,332
|
)
|
(6,058
|
)
|
(5,398
|
)
|
(4,400
|
)
|
||||||||
|
Loans, net
|
1,216,579
|
1,192,179
|
1,176,708
|
1,073,677
|
||||||||||||
|
Federal Home Loan Bank & Atlantic Community Bancshares stock
|
1,614
|
11,014
|
12,289
|
1,062
|
||||||||||||
|
Premises and equipment, net
|
24,125
|
21,797
|
22,429
|
21,631
|
||||||||||||
|
Accrued interest receivable
|
10,589
|
10,496
|
10,271
|
9,471
|
||||||||||||
|
Intangible assets, net
|
6,906
|
5,682
|
6,074
|
4,929
|
||||||||||||
|
Other real estate owned
|
104
|
-
|
-
|
-
|
||||||||||||
|
Deferred tax asset, net
|
37,862
|
29,765
|
28,870
|
36,207
|
||||||||||||
|
Investment in unconsolidated entity
|
127,430
|
157,396
|
162,275
|
178,520
|
||||||||||||
|
Assets held for sale from discontinued operations
|
360,711
|
386,155
|
487,373
|
583,909
|
||||||||||||
|
Other assets
|
50,683
|
55,519
|
60,203
|
47,629
|
||||||||||||
|
Total assets
|
$
|
4,840,882
|
$
|
4,217,511
|
$
|
4,401,775
|
$
|
4,765,823
|
||||||||
|
Liabilities:
|
||||||||||||||||
|
Deposits
|
||||||||||||||||
|
Demand and interest checking
|
$
|
3,816,524
|
$
|
3,364,103
|
$
|
3,569,669
|
$
|
3,602,376
|
||||||||
|
Savings and money market
|
421,780
|
402,832
|
389,851
|
383,832
|
||||||||||||
|
Time deposits
|
-
|
-
|
101,160
|
428,549
|
||||||||||||
|
Total deposits
|
4,238,304
|
3,766,935
|
4,060,680
|
4,414,757
|
||||||||||||
|
Securities sold under agreements to repurchase
|
274
|
353
|
318
|
925
|
||||||||||||
|
Short-term borrowings
|
-
|
70,000
|
-
|
-
|
||||||||||||
|
Long-term borrowings
|
263,099
|
-
|
-
|
-
|
||||||||||||
|
Subordinated debenture
|
13,401
|
13,401
|
13,401
|
13,401
|
||||||||||||
|
Other liabilities
|
27,112
|
27,744
|
37,094
|
16,739
|
||||||||||||
|
Total liabilities
|
$
|
4,542,190
|
$
|
3,878,433
|
$
|
4,111,493
|
$
|
4,445,822
|
||||||||
|
Shareholders' equity:
|
||||||||||||||||
|
Common stock - authorized, 75,000,000 shares of $1.00 par value; 55,419,204 and 37,861,303 shares issued at December 31, 2016 and 2015, respectively
|
55,419
|
55,419
|
37,945
|
37,861
|
||||||||||||
|
Treasury stock (100,000 shares)
|
(866
|
)
|
(866
|
)
|
(866
|
)
|
(866
|
)
|
||||||||
|
Additional paid-in capital
|
360,564
|
359,793
|
301,680
|
300,549
|
||||||||||||
|
Accumulated deficit
|
(112,212
|
)
|
(83,169
|
)
|
(57,721
|
)
|
(15,449
|
)
|
||||||||
|
Accumulated other comprehensive income (loss)
|
(4,213
|
)
|
7,901
|
9,244
|
(2,094
|
)
|
||||||||||
|
Total shareholders' equity
|
298,692
|
339,078
|
290,282
|
320,001
|
||||||||||||
|
Total liabilities and shareholders' equity
|
$
|
4,840,882
|
$
|
4,217,511
|
$
|
4,401,775
|
$
|
4,765,823
|
||||||||
4
|
Average balance sheet and net interest income
|
Three months ended December 31, 2016
|
Three months ended December 31, 2015
|
||||||||||||||||||||||
|
(dollars in thousands)
|
||||||||||||||||||||||||
|
Average
|
Average
|
Average
|
Average
|
|||||||||||||||||||||
|
Assets:
|
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
||||||||||||||||||
|
Interest-earning assets:
|
||||||||||||||||||||||||
|
Loans net of unearned fees and costs **
|
$
|
1,717,927
|
$
|
18,374
|
4.28
|
%
|
$
|
1,416,176
|
$
|
14,502
|
4.10
|
%
|
||||||||||||
|
Leases - bank qualified*
|
21,018
|
414
|
7.88
|
%
|
28,658
|
487
|
6.80
|
%
|
||||||||||||||||
|
Investment securities-taxable
|
1,371,209
|
8,437
|
2.46
|
%
|
1,022,914
|
5,290
|
2.07
|
%
|
||||||||||||||||
|
Investment securities-nontaxable*
|
37,529
|
156
|
1.66
|
%
|
248,662
|
2,203
|
3.54
|
%
|
||||||||||||||||
|
Interest earning deposits at Federal Reserve Bank
|
403,834
|
560
|
0.55
|
%
|
751,126
|
595
|
0.32
|
%
|
||||||||||||||||
|
Federal funds sold and securities purchased under agreement to resell
|
39,485
|
151
|
1.53
|
%
|
31,406
|
112
|
1.43
|
%
|
||||||||||||||||
|
Net interest earning assets
|
3,591,002
|
28,092
|
3.13
|
%
|
3,498,942
|
23,189
|
2.65
|
%
|
||||||||||||||||
|
Allowance for loan and lease losses
|
(5,781
|
)
|
(4,178
|
)
|
||||||||||||||||||||
|
Assets held for sale from discontinued operations
|
377,044
|
3,238
|
3.44
|
%
|
617,983
|
6,650
|
4.30
|
%
|
||||||||||||||||
|
Other assets
|
257,469
|
321,170
|
||||||||||||||||||||||
|
$
|
4,219,734
|
$
|
4,433,917
|
|||||||||||||||||||||
|
Liabilities and Shareholders' Equity:
|
||||||||||||||||||||||||
|
Deposits:
|
||||||||||||||||||||||||
|
Demand and interest checking
|
$
|
3,405,296
|
$
|
2,182
|
0.26
|
%
|
$
|
3,518,223
|
$
|
2,689
|
0.31
|
%
|
||||||||||||
|
Savings and money market
|
407,039
|
498
|
0.49
|
%
|
378,301
|
581
|
0.61
|
%
|
||||||||||||||||
|
Time
|
-
|
-
|
0.00
|
%
|
174,530
|
263
|
0.60
|
%
|
||||||||||||||||
|
Total deposits
|
3,812,335
|
2,680
|
0.28
|
%
|
4,071,054
|
3,533
|
0.35
|
%
|
||||||||||||||||
|
Short-term borrowings
|
55,913
|
96
|
0.69
|
%
|
18,152
|
12
|
0.00
|
%
|
||||||||||||||||
|
Repurchase agreements
|
304
|
-
|
0.00
|
%
|
1,148
|
1
|
0.35
|
%
|
||||||||||||||||
|
Subordinated debt
|
13,401
|
137
|
4.09
|
%
|
13,401
|
120
|
3.58
|
%
|
||||||||||||||||
|
Total deposits and interest bearing liabilities
|
3,881,953
|
2,913
|
0.30
|
%
|
4,103,755
|
3,666
|
0.36
|
%
|
||||||||||||||||
|
Other liabilities
|
18,896
|
13,313
|
||||||||||||||||||||||
|
Total liabilities
|
3,900,849
|
4,117,068
|
||||||||||||||||||||||
|
Shareholders' equity
|
318,885
|
316,849
|
||||||||||||||||||||||
|
$
|
4,219,734
|
$
|
4,433,917
|
|||||||||||||||||||||
|
Net interest income on tax equivalent basis*
|
$
|
28,417
|
$
|
26,173
|
||||||||||||||||||||
|
Tax equivalent adjustment
|
200
|
942
|
||||||||||||||||||||||
|
Net interest income
|
$
|
28,217
|
$
|
25,231
|
||||||||||||||||||||
|
Net interest margin *
|
2.84
|
%
|
2.52
|
%
|
||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
* Full taxable equivalent basis, using a 35% statutory tax rate.
|
||||||||||||||||||||||||
|
** Includes loans held for sale.
|
||||||||||||||||||||||||
5
|
Average balance sheet and net interest income
|
Year ended December 31, 2016
|
Year ended December 31, 2015
|
||||||||||||||||||||||
|
(dollars in thousands)
|
||||||||||||||||||||||||
|
Average
|
Average
|
Average
|
Average
|
|||||||||||||||||||||
|
Assets:
|
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
||||||||||||||||||
|
Interest-earning assets:
|
||||||||||||||||||||||||
|
Loans net of unearned fees and costs **
|
$
|
1,587,306
|
$
|
66,436
|
4.19
|
%
|
$
|
1,245,189
|
$
|
48,733
|
3.91
|
%
|
||||||||||||
|
Leases - bank qualified*
|
20,718
|
1,748
|
8.44
|
%
|
25,126
|
1,734
|
6.90
|
%
|
||||||||||||||||
|
Investment securities-taxable
|
1,303,445
|
31,219
|
2.40
|
%
|
989,705
|
19,918
|
2.01
|
%
|
||||||||||||||||
|
Investment securities-nontaxable*
|
54,271
|
1,139
|
2.10
|
%
|
452,526
|
16,646
|
3.68
|
%
|
||||||||||||||||
|
Interest earning deposits at Federal Reserve Bank
|
466,728
|
2,237
|
0.48
|
%
|
935,093
|
2,354
|
0.25
|
%
|
||||||||||||||||
|
Federal funds sold and securities purchased under agreement to resell
|
30,448
|
450
|
1.48
|
%
|
40,402
|
578
|
1.43
|
%
|
||||||||||||||||
|
Net interest-earning assets
|
3,462,916
|
103,229
|
2.98
|
%
|
3,688,041
|
89,963
|
2.44
|
%
|
||||||||||||||||
|
Allowance for loan and lease losses
|
(4,741
|
)
|
(4,111
|
)
|
||||||||||||||||||||
|
Assets held for sale
|
490,115
|
18,275
|
3.73
|
%
|
715,116
|
28,925
|
4.04
|
%
|
||||||||||||||||
|
Other assets
|
266,777
|
311,501
|
||||||||||||||||||||||
|
$
|
4,215,067
|
$
|
4,710,547
|
|||||||||||||||||||||
|
Liabilities and Shareholders' Equity:
|
||||||||||||||||||||||||
|
Deposits:
|
||||||||||||||||||||||||
|
Demand and interest checking
|
$
|
3,347,191
|
$
|
9,399
|
0.28
|
%
|
$
|
3,975,475
|
$
|
10,982
|
0.28
|
%
|
||||||||||||
|
Savings and money market
|
394,434
|
1,526
|
0.39
|
%
|
337,168
|
1,867
|
0.55
|
%
|
||||||||||||||||
|
Time
|
77,576
|
447
|
0.58
|
%
|
44,789
|
275
|
0.61
|
%
|
||||||||||||||||
|
Total deposits
|
3,819,201
|
11,372
|
0.30
|
%
|
4,357,432
|
13,124
|
0.30
|
%
|
||||||||||||||||
|
Short-term borrowings
|
57,517
|
359
|
0.62
|
%
|
4,575
|
12
|
0.26
|
%
|
||||||||||||||||
|
Repurchase agreements
|
685
|
2
|
0.29
|
%
|
5,224
|
15
|
0.29
|
%
|
||||||||||||||||
|
Subordinated debt
|
13,401
|
520
|
3.88
|
%
|
13,401
|
448
|
3.34
|
%
|
||||||||||||||||
|
Total deposits and interest bearing liabilities
|
3,890,804
|
12,253
|
0.31
|
%
|
4,380,632
|
13,599
|
0.31
|
%
|
||||||||||||||||
|
Other liabilities
|
14,916
|
10,403
|
||||||||||||||||||||||
|
Total liabilities
|
3,905,720
|
4,391,035
|
||||||||||||||||||||||
|
Shareholders' equity
|
309,347
|
319,512
|
||||||||||||||||||||||
|
$
|
4,215,067
|
$
|
4,710,547
|
|||||||||||||||||||||
|
Net interest income on tax equivalent basis*
|
109,251
|
105,289
|
||||||||||||||||||||||
|
Tax equivalent adjustment
|
1,010
|
6,433
|
||||||||||||||||||||||
|
Net interest income
|
$
|
108,241
|
$
|
98,856
|
||||||||||||||||||||
|
Net interest margin *
|
2.74
|
%
|
2.37
|
%
|
||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
* Full taxable equivalent basis, using a 35% statutory tax rate.
|
||||||||||||||||||||||||
|
** Includes loans held for sale.
|
||||||||||||||||||||||||
6
|
Allowance for loan and lease losses:
|
Year ended
|
|||||||||||||||
|
December 31,
|
December 31,
|
|||||||||||||||
|
2016
|
2015
|
|||||||||||||||
|
(dollars in thousands)
|
||||||||||||||||
|
Balance in the allowance for loan and lease losses at beginning of period (1)
|
$
|
4,400
|
$
|
3,638
|
||||||||||||
|
Loans charged-off:
|
||||||||||||||||
|
SBA non real estate
|
128
|
111
|
||||||||||||||
|
SBA commercial mortgage
|
-
|
-
|
||||||||||||||
|
Direct lease financing
|
119
|
30
|
||||||||||||||
|
Other consumer loans
|
1,211
|
1,220
|
||||||||||||||
|
Total
|
1,458
|
1,361
|
||||||||||||||
|
Recoveries:
|
||||||||||||||||
|
SBA non real estate
|
1
|
-
|
||||||||||||||
|
Direct lease financing
|
17
|
-
|
||||||||||||||
|
Other consumer loans
|
12
|
23
|
||||||||||||||
|
Total
|
30
|
23
|
||||||||||||||
|
Net charge-offs
|
1,428
|
1,338
|
||||||||||||||
|
Provision charged to operations
|
3,360
|
2,100
|
||||||||||||||
|
Balance in allowance for loan and lease losses at end of period
|
$
|
6,332
|
$
|
4,400
|
||||||||||||
|
Net charge-offs/average loans
|
0.09
|
%
|
0.11
|
%
|
||||||||||||
|
Net charge-offs/average assets
|
0.03
|
%
|
0.03
|
%
|
||||||||||||
|
(1) Excludes activity from assets held for sale
|
||||||||||||||||
|
Loan portfolio:
|
December 31,
|
September 30,
|
June 30,
|
December 31,
|
||||||||||||
|
2016
|
2016 |
2016
|
2015
|
|||||||||||||
|
(dollars in thousands)
|
||||||||||||||||
|
SBA non real estate
|
$
|
74,644
|
$
|
74,262
|
$
|
71,596
|
$
|
68,887
|
||||||||
|
SBA commercial mortgage
|
126,159
|
117,053
|
116,617
|
114,029
|
||||||||||||
|
SBA construction
|
8,826
|
6,317
|
3,751
|
6,977
|
||||||||||||
|
Total SBA loans
|
209,629
|
197,632
|
191,964
|
189,893
|
||||||||||||
|
Direct lease financing
|
346,645
|
332,632
|
315,639
|
231,514
|
||||||||||||
|
SBLOC
|
630,400
|
621,456
|
607,017
|
575,948
|
||||||||||||
|
Other specialty lending
|
11,073
|
20,076
|
40,543
|
48,315
|
||||||||||||
|
Other consumer loans
|
17,374
|
19,375
|
20,005
|
23,180
|
||||||||||||
|
1,215,121
|
1,191,171
|
1,175,168
|
1,068,850
|
|||||||||||||
|
Unamortized loan fees and costs
|
7,790
|
7,066
|
6,938
|
9,227
|
||||||||||||
|
Total loans, net of deferred loan fees and costs
|
$
|
1,222,911
|
$
|
1,198,237
|
$
|
1,182,106
|
$
|
1,078,077
|
||||||||
|
Small business lending portfolio:
|
December 31,
|
September 30,
|
June 30,
|
December 31,
|
||||||||||||
| 2016 | 2016 | 2016 | 2015 | |||||||||||||
|
(dollars in thousands)
|
||||||||||||||||
|
SBA loans, including deferred fees and costs
|
215,786
|
203,196
|
197,544
|
197,966
|
||||||||||||
|
SBA loans included in HFS
|
154,016
|
146,450
|
136,660
|
109,174
|
||||||||||||
|
Total SBA loans
|
$
|
369,802
|
$
|
349,646
|
$
|
334,204
|
$
|
307,140
|
||||||||
7
|
Capital ratios:
|
Tier 1 capital
to average |
Tier 1 capital
to risk-weighted |
Total capital
to risk-weighted |
Common equity
tier 1 to risk |
||||||||||||
|
assets ratio
|
assets ratio
|
assets ratio
|
weighted assets
|
|||||||||||||
|
As of December 31, 2016
|
||||||||||||||||
|
The Bancorp, Inc.
|
7.06
|
%
|
13.84
|
%
|
14.13
|
%
|
13.84
|
%
|
||||||||
|
The Bancorp Bank
|
6.83
|
%
|
13.31
|
%
|
13.60
|
%
|
13.31
|
%
|
||||||||
|
"Well capitalized" institution (under FDIC regulations)
|
5.00
|
%
|
8.00
|
%
|
10.00
|
%
|
6.50
|
%
|
||||||||
|
As of December 31, 2015
|
||||||||||||||||
|
The Bancorp, Inc.
|
7.17
|
%
|
14.67
|
%
|
14.88
|
%
|
14.67
|
%
|
||||||||
|
The Bancorp Bank
|
6.90
|
%
|
13.98
|
%
|
14.18
|
%
|
13.98
|
%
|
||||||||
|
"Well capitalized" institution (under FDIC regulations)
|
5.00
|
%
|
8.00
|
%
|
10.00
|
%
|
6.50
|
%
|
||||||||
|
Three months ended
|
Year ended
|
|||||||||||||||
|
December 31,
|
December 31,
|
|||||||||||||||
|
2016
|
2015
|
2016
|
2015
|
|||||||||||||
|
Selected operating ratios:
|
||||||||||||||||
|
Return on average assets (annualized)
|
nm
|
1.67
|
%
|
nm
|
0.28
|
%
|
||||||||||
|
Return on average equity (annualized)
|
nm
|
23.31
|
%
|
nm
|
4.19
|
%
|
||||||||||
|
Net interest margin
|
2.84
|
%
|
2.52
|
%
|
2.74
|
%
|
2.37
|
%
|
||||||||
|
Book value per share
|
$
|
5.40
|
$
|
8.47
|
$
|
5.40
|
$
|
8.47
|
||||||||
|
December 31,
|
September 30,
|
June 30,
|
December 31,
|
|||||||||||||
|
2016
|
2016
|
2016
|
2015
|
|||||||||||||
|
Asset quality ratios:
|
||||||||||||||||
|
Nonperforming loans to total loans (2)
|
0.30
|
%
|
0.58
|
%
|
0.53
|
%
|
0.22
|
%
|
||||||||
|
Nonperforming assets to total assets (2)
|
0.08
|
%
|
0.16
|
%
|
0.14
|
%
|
0.05
|
%
|
||||||||
|
Allowance for loan and lease losses to total loans
|
0.52
|
%
|
0.51
|
%
|
0.46
|
%
|
0.41
|
%
|
||||||||
|
Nonaccrual loans
|
$
|
2,972
|
$
|
4,021
|
$
|
3,147
|
$
|
1,927
|
||||||||
|
Other real estate owned
|
104
|
-
|
-
|
-
|
||||||||||||
|
Total nonperforming assets
|
$
|
3,076
|
$
|
4,021
|
$
|
3,147
|
$
|
1,927
|
||||||||
|
Loans 90 days past due still accruing interest
|
$
|
661
|
$
|
2,933
|
$
|
3,172
|
$
|
403
|
||||||||
|
(2) Nonperforming loan and asset ratios include nonaccrual loans and loans 90 days past due still accruing interest.
|
||||||||||||||||
|
Three months ended
|
||||||||||||||||
|
December 31,
|
September 30,
|
June 30,
|
December 31,
|
|||||||||||||
|
2016
|
2016
|
2016
|
2015
|
|||||||||||||
|
(in thousands)
|
||||||||||||||||
|
Gross dollar volume (GDV) (1):
|
||||||||||||||||
|
Prepaid card GDV
|
$
|
10,647,520
|
$
|
10,459,097
|
$
|
11,442,294
|
$
|
9,839,782
|
||||||||
|
(1) Gross dollar volume represents the total dollar amount spent on prepaid and debit cards issued by The Bancorp.
|
||||||||||||||||
8
|
Cumulative analysis of marks on discontinued commercial loan principal
|
||||||||||||||||||||||||
|
(dollars in millions)
|
||||||||||||||||||||||||
|
Commercial
loan principal |
Cumulative
marks |
Mark
chargedowns |
Cumulative
marks |
% to principal
|
||||||||||||||||||||
|
12 loan relationships >$8 million
|
$
|
232
|
$
|
232
|
||||||||||||||||||||
|
Add back mark chargedowns to principal
|
20
|
|||||||||||||||||||||||
|
Total principal to compare to cumulative marks
|
$
|
252
|
$
|
40
|
$
|
20
|
$
|
60
|
24
|
%
|
||||||||||||||
|
Other loans
|
92
|
10
|
-
|
10
|
11
|
%
|
||||||||||||||||||
|
Total discontinued loan principal *
|
$
|
324
|
$
|
50
|
$
|
20
|
$
|
70
|
||||||||||||||||
|
* Of the $324 million commercial loan principal at 12.31.16, $93.5 million was non performing.
|
||||||||||||||||||||||||
|
Discontinued operations portfolio composition 12/31/2016:
|
||||||||||||
|
Collateral type
|
Unpaid principal balance
|
Mark 12.31.16
|
Mark as % of portfolio
|
|||||||||
|
(dollars in millions)
|
||||||||||||
|
Commercial real estate - non-owner occupied:
|
||||||||||||
|
Retail
|
$
|
60
|
$
|
24.5
|
41
|
%
|
||||||
|
Other
|
51
|
0.2
|
-
|
|||||||||
|
Office
|
15
|
0.2
|
1
|
%
|
||||||||
|
Construction and land
|
83
|
2.1
|
3
|
%
|
||||||||
|
Commercial non-real estate and industrial
|
38
|
15.5
|
41
|
%
|
||||||||
|
1 to 4 family construction
|
31
|
1.3
|
4
|
%
|
||||||||
|
First mortgage residential non-owner occupied
|
21
|
5.2
|
25
|
%
|
||||||||
|
Commercial real estate owner occupied:
|
||||||||||||
|
Retail
|
11
|
0.2
|
2
|
%
|
||||||||
|
Other
|
2
|
-
|
-
|
|||||||||
|
Office
|
-
|
-
|
-
|
|||||||||
|
First mortgage residential owner occupied
|
4
|
0.2
|
5
|
%
|
||||||||
|
Multifamily
|
3
|
-
|
-
|
|||||||||
|
Residential junior mortgage
|
3
|
0.1
|
3
|
%
|
||||||||
|
Other
|
2
|
-
|
-
|
|||||||||
|
Total
|
$
|
324
|
$
|
49.5
|
15
|
%
|
||||||
9
|
Analysis of Walnut Street marks:
|
||||||||
|
Loan activity
|
Marks
|
|||||||
|
(dollars in millions)
|
||||||||
|
Original Walnut Street loan balance 12.31.14
|
$
|
267
|
||||||
|
Marks through 12.31.14 sale date
|
(58
|
)
|
$
|
(58
|
)
|
|||
|
Sales price of Walnut Street
|
209
|
|||||||
|
Equity investment from independent investor
|
(16
|
)
|
||||||
|
12.31.2014 Bancorp book value
|
193
|
|||||||
|
Additional marks 2015 and 2016
|
(42
|
)
|
(42
|
)
|
||||
|
Payments received
|
(24
|
)
|
||||||
|
12.31.2016 Bancorp book value*
|
$
|
127
|
||||||
|
Total marks
|
$
|
(100
|
)
|
|||||
|
Divided by:
|
||||||||
|
Original Walnut Street loan balance
|
$
|
267
|
||||||
|
Percentage of total mark to original balance
|
37
|
%
|
||||||
|
* Approximately 21% of expected principal recoveries were classified as non performing as of 12.31.16.
|
||||||||
|
Walnut Street portfolio composition 12/31/2016:
|
|
|
Collateral type
|
% of Portfolio
|
|
Commercial real estate non-owner occupied
|
|
|
Retail
|
25.2%
|
|
Other
|
23.4%
|
|
Office
|
19.7%
|
|
Construction and land
|
19.7%
|
|
Commercial non real estate and industrial
|
4.7%
|
|
First mortgage residential owner occupied
|
3.5%
|
|
First mortgage residential non-owner occupied
|
2.7%
|
|
Other
|
1.1%
|
|
Total
|
100.0%
|
10