2014

Severn Bancorp Announces Fourth Quarter Earnings and Significant Growth In Year End Net Income

ANNAPOLIS, Md., Jan. 25, 2013 /PRNewswire/ -- Severn Bancorp, Inc., (Nasdaq: SVBI) parent company of Severn Savings Bank, FSB ("Severn"), today announced net income of $1,156,000 or $.08 per share for the fourth quarter, slightly higher than net income of  $1,067,000, or $.06 per share for the fourth quarter of 2011.  Net income was $3,283,000, or $.18 per share for the year ended December 31, 2012, compared to net income of $1,219,000, or $(.05) per share for the year ended December 31, 2011.  Earnings per share is calculated using net income available for common shareholders, which is net income less preferred stock dividends.

"These are our best year end results in four years.  While they are improved, we are not yet satisfied.  These results and the positive trend are strong motivators and reaffirm our dedication to continue our hard work," said Alan J. Hyatt, president and chief executive officer.  Mr. Hyatt continued, "We have had a decent year financially and also enjoyed some recognition for our commitment to the community through several awards.  We are energized for 2013."

About Severn Savings Bank:
Founded in 1946, Severn is a full-service community bank offering a wide array of personal and commercial banking products as well as residential and commercial mortgage lending. It has assets of approximately $850 million and four branches located in Annapolis, Edgewater and Glen Burnie, Maryland. The bank specializes in exceptional customer service and holds itself and its employees to a high standard of community contribution. Severn is on the Web at www.severnbank.com.

Forward Looking Statements
In addition to the historical information contained herein, this press release contains forward-looking statements that involve risks and uncertainties that may be affected by various factors that may cause actual results to differ materially from those in the forward-looking statements.  The forward-looking statements contained herein include, but are not limited to, those with respect to management's determination of the amount of loan loss reserve and statements about the economy.  The words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "will," "would," "could," "should," "guidance," "potential," "continue," "project," "forecast," "confident," and similar expressions are typically used to identify forward-looking statements.  Severn's operations and actual results could differ significantly from those discussed in the forward-looking statements.  Some of the factors that could cause or contribute to such differences include, but are not limited to, changes in the economy and interest rates both in the nation and in Severn's general market area, federal and state regulation, competition and other factors detailed from time to time in Severn's filings with the Securities and Exchange Commission (the "SEC"), including "Item 1A. Risk Factors" contained in Severn's Annual Report on Form 10-K for the fiscal year ended December 31, 2011.


Severn Bancorp, Inc.

Selected Financial Data

(dollars in thousands, except per share data)

(Unaudited)























For the Three Months Ended





December 31,

September 30,

June 30,

March 31,

December 31,





2012

2012

2012

2012

2011










Summary Operating Results:







Interest income

$              9,412

$              9,104

$             10,276

$             10,265

$             10,558


Interest expense

2,587

3,027

3,336

3,552

3,659



Net interest income

6,825

6,077

6,940

6,713

6,899


Provision for loan losses

300

-

-

465

141



Net interest income after provision









for loan losses

6,525

6,077

6,940

6,248

6,758


Non-interest income

1,478

1,039

835

891

873


Non-interest expense

6,010

6,152

5,906

6,311

5,772


Income before income taxes

1,993

964

1,869

828

1,859


Income tax expense

837

406

772

356

792


Net income

$              1,156

$                 558

$              1,097

$                 472

$              1,067










Per Share Data:







Basic earnings per share

$                0.08

$                0.02

$                0.07

$                0.01

$                0.06


Diluted earnings per share

$                0.08

$                0.02

$                0.07

$                0.01

$                0.06


Common stock dividends per share

$                      -

$                      -

$                      -

$                      -

$                      -


Average basic shares outstanding

10,066,679

10,066,679

10,066,679

10,066,679

10,066,679


Average diluted shares outstanding

10,066,679

10,066,679

10,066,679

10,066,679

10,066,679










Performance Ratios:







Return on average assets

0.13%

0.06%

0.12%

0.05%

0.12%


Return on average equity

1.09%

0.52%

1.04%

0.45%

1.01%


Net interest margin

3.33%

3.09%

3.41%

3.27%

3.27%


Efficiency ratio*

66.05%

73.88%

67.20%

66.99%

64.84%












*

The efficiency ratio is general and administrative expenses as a percentage of net interest income plus non-interest income














As of





December 31,

September 30,

June 30,

March 31,

December 31,





2012

2012

2012

2012

2011










Balance Sheet Data:







Total assets

$           851,138

$           861,766

$           896,644

$           900,471

$           900,628


Total loans receivable

680,305

695,198

691,647

701,596

719,241


Allowance for loan losses

(17,478)

(23,180)

(24,097)

(25,795)

(25,938)



Net loans

662,827

672,018

667,550

675,801

693,303


Deposits

599,394

609,772

643,653

650,473

652,757


Borrowings

115,000

115,000

115,000

115,000

115,000


Stockholders' equity

108,017

107,142

106,866

106,051

105,930


Bank's Tier 1 core capital to total assets

14.5%

14.1%

13.3%

13.1%

13.0%


Book value per share

$                8.08

$                8.00

$                7.97

$                7.89

$                7.88










Asset Quality Data:







Non-accrual loans

$             30,537

$             29,790

$             29,450

$             17,882

$             23,912


Non-accrual troubled debt restructurings

7,208

12,574

9,515

11,677

19,351


Foreclosed real estate

11,441

13,801

16,329

19,853

19,932



Total non-performing assets

49,186

56,165

55,294

49,412

63,195


Performing troubled debt restructurings

54,875

51,230

51,034

51,034

52,255


Total non-accrual loans to net loans

5.7%

6.3%

5.8%

4.4%

6.2%


Allowance for loan losses

17,478

23,180

24,097

25,795

25,938


Allowance for loan losses to total loans

2.6%

3.3%

3.5%

3.7%

3.6%


Allowance for loan losses to total








non-performing loans

46.3%

54.7%

61.8%

87.3%

60.0%


Total non-accrual loans to total assets

4.4%

4.9%

4.3%

3.3%

4.8%


Total non-performing assets to total assets

5.8%

6.5%

6.2%

5.5%

7.0%

 

SOURCE Severn Bancorp, Inc.



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http://www.severnbank.com

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