CommerceFirst Bancorp Announces Results of Operations

ANNAPOLIS, Md., Oct. 19, 2011 /PRNewswire/ -- CommerceFirst Bancorp, Inc. (NASDAQ: CMFB), the holding company for CommerceFirst Bank, earned a consolidated net profit of $1.4 million for the nine months ended September 30, 2011 as compared to $1.3 million for the nine months ended September 30, 2010.  Basic and diluted earnings were $0.77 per share for the nine months ended September 30, 2011 as compared to $0.70 during the same period in 2010. Earnings increased during 2011 as compared to 2010 because of increases in net interest income and non-interest income. Net interest margin increased in 2011 as compared to 2010 primarily because of reduced interest expense paid on deposits. Assets increased $1.7 million at September 30, 2011 from December 31, 2010 with increases in cash and cash equivalents offsetting the decline in loans receivable. The Company continues to experience the detrimental effects of the weakened economy on new loan volume as well as its loan customers' ability to pay and on collateral values. Key measurements and events for the nine months ended September 30, 2011 include the following:

• Net interest income, the Company's main source of income, increased by 7.2% from $7.0 million in 2010 to $7.5 million in 2011. Net interest income increased primarily because of the reduced cost of funds during 2011 as the Company renewed or replaced certificates of deposit at lower interest rates.  Net interest margin was 5.02% in the nine months ended September 30, 2011, as compared to 4.64% in the same period in 2010.

• The Company's net income of $1.4 million for the nine months ended September 30, 2011 was comparable to net income of $1.3 million for the nine months ended September 30, 2010. Net income for the three months ended September 30, 2011 was $495 thousand, or $0.27 per share, as compared to $356 thousand, or $0.20 per share, for the three months ended September 30, 2010.

• The provision for loan losses increased from $1.6 million in the nine months ended September 30, 2010 to $1.9 million in the nine months ended September 30, 2011. The Company also wrote-down the recorded value of its other real estate owned by $125 thousand to recognize the decline in the value of other real estate owned in 2011 as compared to a $75 thousand write-down during the same period in 2010. Loan collection expenses increased from $49 thousand in 2010 to $145 thousand in 2011. These expense increases were offset by increases in net interest income and increases in non-interest income.

• Total assets increased by 0.8% from $203 million at December 31, 2010 to $205 million at September 30, 2011. Net loans outstanding decreased by 2.2% from $182 million at December 31, 2010 to $178 million as of September 30, 2011. Deposits increased by 0.1% from $180.1 million at December 31, 2010 to $180.3 million at September 30, 2011. The Company has concentrated on increasing earnings through balance sheet management to grow its capital levels and establishing strong loss reserves during these economically challenging times. The Company's capital ratios exceed those necessary to be considered "Well Capitalized" under Federal capital guidelines.  

• Non-performing loans declined to $5.0 million at September 30, 2011 from $7.3 million at December 31, 2010. The allowance for loan losses was $3.0 million, 1.7% of loans receivable, at September 30, 2011 as compared to $3.2 million, 1.7% of loans receivable, at December 31, 2010. Loans in the amount of $2.0 million, net of recoveries, were written-off during the nine months ended September 30, 2011.

• Non-interest income increased by 16.8% from $780 thousand in 2010 to $911 thousand in 2011 primarily from gains on sales of other real estate owned, net rental income on leased other real estate owned and increased deposit fee income during 2011.  Non-interest expenses increased by 5.5% from $4.0 million in 2010 to $4.3 million in 2011, including the asset write-offs and collection expenses noted above.

Forward Looking Statements.  This press release includes forward looking statements within the meaning of Section 21(e) of the Securities Exchange Act of 1934. These statements are based on the Company's current expectations and estimates as to prospective events and circumstances that may or may not be in the Company's control and as to which there can be no firm assurances given. These forward looking statements are subject to risks and uncertainties; there can be no assurance that any of these forward looking statements may prove to be correct and actual results may differ materially.

SOURCE CommerceFirst Bancorp, Inc.