Middleburg Financial Corporation Announces First Quarter 2011 Results
MIDDLEBURG, Va., April 27, 2011 /PRNewswire/ -- Middleburg Financial Corporation (the "Company") (Nasdaq: MBRG), today announced net income of $1.2 million for the quarter ending March 31, 2011 representing an increase of 50.7% over the same quarter in 2010.
"First Quarter net income of $1.2 million created a nice foundation for continued earnings growth for Middleburg as we move forward into 2011," commented Gary R. Shook, President and Chief Executive Officer of Middleburg Financial Corporation. "While we were disappointed with the slight increase in non-performing assets, we are pleased with the strong growth in net interest income during the quarter, which helped to offset lower fee income from mortgage operations. Our majority owned mortgage subsidiary, Southern Trust Mortgage capitalized upon recent disruptions in the market place by bringing aboard new loan officers and leadership, most notably in our Northern Virginia and Richmond markets." Mr. Shook went on to say, "Additionally, we are extremely pleased with the marked improvement in our commercial loan and investment management business pipelines These renewed signs of life bode well for the Company over the coming quarters. While we do expect our non-performing assets to remain elevated through 2011, our strong focus on loan work-outs, sales of foreclosed properties, and expense controls along with new revenue growth creates the opportunity for increased profitability as the economy continues to improve."
First Quarter 2011 Highlights:
- Net income of $1.2 million or $0.18 per diluted share, up 50.7% compared to first quarter of 2010;
- Net interest margin of 3.80% compared to margin of 3.60% for fourth quarter of 2010;
- Total revenue of $14.0 million, up 3.7% compared to first quarter of 2010;
- Loan growth of 0.5% during the quarter;
- Total assets of $1.1 billion, down 1.8% from December 31, 2010;
- Deposits decreased $24.9 million or 2.8% during the quarter;
- Provision for loan losses for the quarter decreased by 51.1% compared to first quarter of 2010; and
- Capital ratios continue to be strong: Tangible Common Equity Ratio of 8.54%, Total Risk-Based Capital Ratio of 14.5%, Tier I Risk-Based Capital Ratio of 13.3%, and a Tier 1 Leverage Ratio of 9.4% at March 31, 2011.
Total Revenue
Total revenue was $14.0 million in the quarter ended March 31, 2011 compared to $17.0 million in the previous quarter and $13.5 million in the quarter ended March 31, 2010, representing a decrease of 17.1% compared to the previous linked quarter and an increase of 3.7% compared to the calendar quarter ended March 31, 2010.
Net interest income was $9.0 million during the three months ended March 31, 2011, which was unchanged compared to the quarter ended December 31, 2010 and an increase of 6.8% compared to the quarter ended March 31, 2010. The average yield on earning assets was 4.91% for the quarter ended March 31, 2011 compared to 4.78% for the previous quarter and 5.58% for the quarter ended March 31, 2010, representing an increase of 13 basis points from the previous quarter and a decrease of 67 basis points from the quarter ended March 31, 2010. Average earning assets declined 3.1% compared to the previous quarter. The primary reason for the decline in earning assets during the first quarter was a reduction in balances of mortgage loans held-for-sale. The increase in yields on earning assets from the previous quarter reflected a decrease of 21 basis points in the yield of the securities portfolio and a 26 basis point increase in yields for the loan portfolio.
The average cost of interest bearing liabilities was 1.30% for the quarter ended March 31, 2011, compared to 1.41% in the previous quarter, and 1.93% for the quarter ended March 31, 2010, representing a decrease of 11 basis points from the previous quarter and a decrease of 63 basis points from the quarter ended March 31, 2010. Costs for wholesale borrowings increased by 2 basis points during the quarter, while costs for retail deposits decreased by 9 basis points during the same period. The decline in the cost of retail deposits was driven by a 6 basis point decline in the cost of interest checking deposits and a 4 basis point decline in the cost of time deposits. Cost of funds is calculated by dividing total interest expense by the sum of average interest bearing liabilities and average demand deposits. Cost of funds was 1.14% for the quarter ended March 31, 2011 compared to 1.21% for the quarter ended December 31, 2010, a decrease of 7 basis points from the previous quarter
The net interest margin for the three months ended March 31, 2011 was 3.80%, compared to 3.60% for the previous quarter, and 3.94% for the quarter ended March 31, 2010, representing an increase of 20 basis points from the previous quarter and a decrease of 14 basis points compared to the quarter ended March 31, 2010.
The Company's net interest margin is not a measurement under accounting principles generally accepted in the United States, but it is a common measure used by the financial services industry to determine how profitably earning assets are funded. The Company's net interest margin is calculated by dividing tax equivalent net interest income by total average earning assets. Tax equivalent net interest income is calculated by grossing up interest income for the amounts that are non-taxable (i.e., municipal income) then subtracting interest expense. The tax rate utilized is 34%. Details on the calculation of the net interest margin are included in the "Key Statistics" table.
Non-interest income declined by $3.0 million or 37.7% when comparing the quarter ended March 31, 2011 to the previous quarter, and declined by $103,000 or 2.0% compared to the calendar quarter ended March 31, 2010. The primary reason for the lower non-interest income in the first quarter of 2011 was a decline in gain-on-sale revenues from the Company's mortgage operations.
Southern Trust Mortgage originated $136.4 million in mortgage loans during the quarter ended March 31, 2011 compared to $227.7 million originated during the previous quarter, a decrease of 40%, and $149 million originated during the quarter ended March 31, 2010, a decrease of 10% when comparing calendar quarters. Gains on mortgage loan sales decreased by 48.6% when comparing the quarter ended March 31, 2011 to the previous quarter. Gains on mortgage loan sales increased by 8.2% when comparing the quarter ended March 31, 2011 to the quarter ended March 31, 2010. The decline in mortgage originations and the decrease in gain-on-sale revenue in the first quarter of 2011 was driven by an increase in mortgage rates during the first quarter.
The revenues and expenses of Southern Trust Mortgage for the three month period ended March 31, 2011 is reflected in the Company's financial statements on a consolidated basis following generally accepted accounting principles in the United States. The outstanding equity interest not held by the Company is reported on the Company's balance sheet as "Non-controlling interest in consolidated subsidiary" and the earnings or loss attributable to the non-controlling interest is reported on the Company's statement of operations as "Net (income) / loss attributable to non-controlling interest."
Trust and investment advisory service fees earned by Middleburg Trust Company ("MTC") increased by 3.5% when comparing the quarter ended March 31, 2011 to the previous quarter, and increased by 6.4% compared to the quarter ended March 31, 2010. On January 3, 2011, Middleburg Investment Advisers was merged into Middleburg Trust Company and ceased operating as an independent company.
Trust and investment advisory fees are based primarily upon the market value of the accounts under administration. Total consolidated assets under administration by MTC were at $1.2 billion at March 31, 2011, a decrease of 7.6% relative to December 31, 2010 and an increase of 5.9% relative to March 31, 2010.
Net securities gains were $34,000 during the quarter ended March 31. 2011 compared to net securities losses of $20,000 during the quarter ended December 31, 2010. The net securities gains during the quarter ended March 31, 2011 included $1,000 of other than temporary impairment losses related to one trust preferred security identified as impaired under generally accepted accounting principles.
Non-Interest Expense
Non-interest expense in the first quarter of 2011 decreased by 13.5% compared to the previous quarter and increased by 2.5% compared to the quarter ended March 31, 2010.
Salaries and employee benefit expenses decreased by $432,000 or 5.6% when comparing the first quarter of 2011 to the quarter ended December 31, 2010, primarily due to a decline in commission expenses. Expenses related to Other Real Estate Owned (OREO) decreased by $498,000 or 59.1% when comparing the first quarter of 2011 to the previous quarter. Other expenses, which include expenses such as supplies, travel and entertainment expenses fell by $841,000 when comparing the quarter ended March 31, 2011 to the previous quarter.
The Company's efficiency ratio which is represented by the ratio of non-interest expense to the sum of tax equivalent net interest income and non-interest income, excluding securities gains and losses, was 84.96% for the first quarter of 2011, compared to an efficiency ratio of 81.42% in the quarter ending December 31, 2010.
Asset Quality and Provision for Loan Losses
The provision for loan losses in the quarter ended March 31, 2011 was $454,000 compared to a $655,000 provision in the quarter ended December 31, 2010 and a provision of $929,000 in the quarter ended March 31, 2010, representing a decrease of 30.7% from the previous quarter and a decrease of 51.1% from the quarter ended March 31, 2010.
The Allowance for Loan and Lease Losses (ALLL) at March 31, 2011 was $14.6 million representing 2.20% of total portfolio loans outstanding versus 2.27% at December 31, 2010 and 1.50% of total portfolio loans at March 31, 2010.
Loans that were delinquent for more than 90 days and still accruing were $6.6 million as of March 31, 2011 compared to $909,000 as of December 31, 2010. The increase in delinquent loans in the first quarter was primarily due to two credit relationships:
- Credit Relationship for $4.5 million –The loan has matured and negotiations are underway with the borrower to resolve the delinquency status. Management believes that the reserve provided for on this loan at March 31, 2011 is adequate.
- Credit Relationship for $1.6 million – The loan is secured with commercial real estate which is undergoing a tenant transition and is expected to be brought current in the near future. Management believes that the loan is adequately collateralized and that no additional reserve is needed as of March 31, 2011.
Non-accrual loans were $27.6 million at the end of the first quarter compared to $29.4 million as of December 31, 2010, representing a decrease of 6.1% during the first quarter. Restructured loans were $1.3 million at the end of the first quarter, unchanged from the balance of restructured loans as of December 31, 2010. Other Real Estate Owned (OREO) was $7.8 million as of March 31, 2011 compared to $8.4 million as of December 31, 2010, representing a decrease of 7.1% during the first quarter. Non-performing assets were $43.3 million or 4.0% of total assets at March 31, 2011, compared to $39.9 million or 3.5% of total assets as of December 31, 2010.
Total Consolidated Assets
Total assets at March 31, 2011 were $1.1 billion, a decrease of $20.3 million or 1.8% compared to total assets at December 31, 2010.
Growth in total portfolio loans was $3.2 million or 0.5% for the first quarter. The securities portfolio increased by $6.4 million or 2.5% in the first quarter relative to the previous quarter. Balances of mortgages held for sale declined by $5.0 million or 42.0% in the first quarter of 2011. Cash balances and deposits at other banks decreased by 5.3% in the first quarter of 2011.
Deposits and Other Borrowings
Total deposits decreased by 2.8% in the first quarter. Brokered deposits, including CDARS program funds, were $93.1 million at March 31, 2011, down $29.2 million or 23.8% from December 31, 2010. Brokered deposit balances declined in the first quarter as the Company used proceeds from sales of mortgage loans to pay off maturing deposits. FHLB advances were $72.9 million at March 31, 2011, up $10 million from December 31, 2010, or an increase of 15.9%.
Equity and Capital
Total shareholders' equity at March 31, 2011 was $98.4 million, compared to shareholders' equity of $97.0 million as of December 31, 2010. Retained earnings at March 31, 2011 were $38.5 million compared to $37.6 million at December 31, 2010. The book value of the Company's common stock at March 31, 2011 was $14.18 per share. The Company's total risk-based capital ratio increased from 14.1% at December 31, 2010 to 14.5% at March 31, 2011, the Tier 1 risk-based capital ratio increased from 12.8% to 13.3% and the Tier 1 Leverage Ratio increased from 9.0% to 9.4% during the same period. The increases in the risk-based capital ratios resulted from increased capital levels from December 31, 2010 to March 31, 2011 due to quarterly earnings and a slight decrease in average assets from the quarter ended December 31, 2010 to the quarter ended March 31, 2011.
Certain information contained in this discussion may include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements relate to the Company's future operations and are generally identified by phrases such as "the Company expects," "the Company believes" or words of similar import. Although the Company believes that its expectations with respect to the forward-looking statements are based upon reliable assumptions within the bounds of its knowledge of its business and operations, there can be no assurance that actual results, performance or achievements of the Company will not differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. For details on factors that could affect expectations, see the risk factors and other cautionary language included in the Company's Annual Report on Form 10-K for the year ended December 31, 2010, and other filings with the Securities and Exchange Commission.
About Middleburg Financial Corporation
Middleburg Financial Corporation is headquartered in Middleburg, Virginia and has two wholly owned subsidiaries, Middleburg Bank and Middleburg Investment Group, Inc. Middleburg Bank serves communities in Virginia with financial centers in Ashburn, Gainesville, Leesburg, Marshall, Middleburg, Purcellville, Reston, Warrenton and Williamsburg. Middleburg Investment Group owns Middleburg Trust Company, which is headquartered in Richmond, Virginia with offices in Middleburg, Alexandria and Williamsburg. Middleburg Financial Corporation is also the majority owner of Southern Trust Mortgage, which is based in Virginia Beach and provides mortgages through 17 offices in 11 states.
MIDDLEBURG FINANCIAL CORPORATION CONSOLIDATED STATEMENTS OF INCOME (In thousands, except for per share data) |
||||||||
Unaudited |
||||||||
For the Three Months |
||||||||
Ended March 31, |
||||||||
2011 |
2010 |
|||||||
INTEREST INCOME |
||||||||
Interest and fees on loans |
$ 9,735 |
$ 10,445 |
||||||
Interest and dividends on securities available for sale |
||||||||
Taxable |
1,399 |
938 |
||||||
Tax-exempt |
561 |
693 |
||||||
Dividends |
36 |
21 |
||||||
Interest on deposits in banks and federal funds sold |
27 |
35 |
||||||
Total interest and dividend income |
11,758 |
12,132 |
||||||
INTEREST EXPENSE |
||||||||
Interest on deposits |
2,308 |
3,174 |
||||||
Interest on securities sold under agreements to |
||||||||
repurchase |
56 |
20 |
||||||
Interest on short-term borrowings |
63 |
44 |
||||||
Interest on long-term debt |
296 |
438 |
||||||
Total interest expense |
2,723 |
3,676 |
||||||
NET INTEREST INCOME |
9,035 |
8,456 |
||||||
Provision for loan losses |
454 |
929 |
||||||
NET INTEREST INCOME AFTER PROVISION |
||||||||
FOR LOAN LOSSES |
8,581 |
7,527 |
||||||
NONINTEREST INCOME |
||||||||
Service charges on deposit accounts |
489 |
441 |
||||||
Trust services income |
867 |
815 |
||||||
Net gains on loans held for sale |
2,847 |
2,630 |
||||||
Net gains on securities available for sale |
35 |
506 |
||||||
Total other-than-temporary impairment (loss) gain on securities |
343 |
(41) |
||||||
Portion of (gain) loss recognized in other comprehensive income |
(344) |
(110) |
||||||
Net impairment loss on securities |
(1) |
(151) |
||||||
Commissions on investment sales |
180 |
144 |
||||||
Fees on mortgages held for sale |
154 |
358 |
||||||
Other service charges, commissions and fees |
115 |
113 |
||||||
Bank-owned life insurance |
123 |
125 |
||||||
Other operating income |
160 |
91 |
||||||
Total noninterest income |
4,969 |
5,072 |
||||||
NONINTEREST EXPENSE |
||||||||
Salaries and employees' benefits |
7,316 |
6,924 |
||||||
Net occupancy and equipment expense |
1,676 |
1,604 |
||||||
Advertising |
156 |
180 |
||||||
Computer operations |
365 |
328 |
||||||
Other real estate owned |
344 |
210 |
||||||
Other taxes |
197 |
196 |
||||||
Federal deposit insurance expense |
407 |
801 |
||||||
Other operating expenses |
1,775 |
1,700 |
||||||
Total noninterest expense |
12,236 |
11,943 |
||||||
Income before income taxes |
1,314 |
656 |
||||||
Income tax expense |
317 |
87 |
||||||
NET INCOME |
997 |
569 |
||||||
Net (income) loss attributable to non- |
||||||||
controlling interest |
230 |
245 |
||||||
Net income attributable to Middleburg |
||||||||
Financial Corporation |
$ 1,227 |
$ 814 |
||||||
Earnings per share: |
||||||||
Basic |
$ 0.18 |
$ 0.12 |
||||||
Diluted |
$ 0.18 |
$ 0.12 |
||||||
MIDDLEBURG FINANCIAL CORPORATION CONSOLIDATED BALANCE SHEETS (In thousands, except for share and per share data) |
||||||||
(Unaudited) |
||||||||
March 31, |
December 31, |
|||||||
2011 |
2010 |
|||||||
ASSETS |
||||||||
Cash and due from banks |
$ |
22,060 |
$ |
21,955 |
||||
Interest-bearing deposits with other institutions |
39,237 |
42,769 |
||||||
Total cash and cash equivalents |
61,297 |
64,724 |
||||||
Securities available for sale |
258,412 |
252,042 |
||||||
Loans held for sale |
34,407 |
59,361 |
||||||
Restricted securities, at cost |
6,746 |
6,296 |
||||||
Loans receivable, net of allowance for loan losses of $14,575 at |
||||||||
March 31, 2011 and $14,967 at December 31, 2010. |
647,985 |
644,345 |
||||||
Premises and equipment, net |
20,908 |
21,112 |
||||||
Goodwill and identified intangibles |
6,317 |
6,360 |
||||||
Other real estate owned, net of valuation allowance of |
||||||||
$1,187 at March 31, 2011 and $1,486 at December 31, 2010. |
7,825 |
8,394 |
||||||
Prepaid federal deposit insurance |
4,791 |
5,154 |
||||||
Accrued interest receivable and other assets |
35,601 |
36,779 |
||||||
TOTAL ASSETS |
$ |
1,084,289 |
$ |
1,104,567 |
||||
LIABILITIES |
||||||||
Deposits: |
||||||||
Non-interest-bearing demand deposits |
$ |
122,888 |
$ |
130,488 |
||||
Savings and interest-bearing demand deposits |
448,065 |
436,718 |
||||||
Time deposits |
294,502 |
323,100 |
||||||
Total deposits |
865,455 |
890,306 |
||||||
Securities sold under agreements to repurchase |
27,963 |
25,562 |
||||||
Short-term borrowings |
4,244 |
13,320 |
||||||
Long-term debt |
72,912 |
62,912 |
||||||
Subordinated notes |
5,155 |
5,155 |
||||||
Accrued interest payable and other liabilities |
7,353 |
7,319 |
||||||
TOTAL LIABILITIES |
983,082 |
1,004,574 |
||||||
SHAREHOLDERS' EQUITY |
||||||||
Common stock ($2.50 par value; 20,000,000 shares authorized, |
||||||||
6,945,261 issued; 6,942,315 and 6,925,437 outstanding at |
||||||||
March 31, 2011 and December 31, 2010, respectively) |
17,314 |
17,314 |
||||||
Capital surplus |
43,105 |
43,058 |
||||||
Retained earnings |
38,473 |
37,593 |
||||||
Accumulated other comprehensive loss |
(480) |
(1,012) |
||||||
Total Middleburg Financial Corporation shareholders' equity |
98,412 |
96,953 |
||||||
Non-controlling interest in consolidated subsidiary |
2,795 |
3,040 |
||||||
TOTAL SHAREHOLDERS' EQUITY |
101,207 |
99,993 |
||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY |
$ |
1,084,289 |
$ |
1,104,567 |
||||
QUARTERLY SUMMARY INCOME STATEMENTS MIDDLEBURG FINANCIAL CORPORATION (Unaudited. Dollars in thousands except per share data) |
||||||||||
For the Three Months Ended |
||||||||||
Mar. 31, 2011 |
Dec. 31, 2010 |
Sep. 30, 2010 |
Jun. 30, 2010 |
Mar. 31, 2010 |
||||||
Interest and Dividend Income |
||||||||||
Interest and fees on loans |
$ 9,735 |
$ 9,887 |
$ 9,832 |
$ 10,384 |
$ 10,445 |
|||||
Interest on securities available for sale |
||||||||||
Taxable |
1,399 |
1,539 |
1,166 |
1,090 |
938 |
|||||
Exempt from federal income taxes |
561 |
600 |
621 |
600 |
693 |
|||||
Dividends |
36 |
30 |
32 |
22 |
21 |
|||||
Interest on federal funds sold and other |
27 |
32 |
36 |
28 |
35 |
|||||
Total interest and dividend income |
$ 11,758 |
$ 12,088 |
$ 11,687 |
$ 12,124 |
$ 12,132 |
|||||
Interest Expense |
||||||||||
Interest on deposits |
$ 2,308 |
$ 2,623 |
$ 3,160 |
$ 3,077 |
$ 3,174 |
|||||
Interest on securities sold under agreements to repurchase |
56 |
61 |
63 |
60 |
20 |
|||||
Interest on short-term borrowings |
63 |
148 |
134 |
67 |
44 |
|||||
Interest on long-term debt |
296 |
246 |
372 |
488 |
438 |
|||||
Total interest expense |
$ 2,723 |
$ 3,078 |
$ 3,729 |
$ 3,692 |
$ 3,676 |
|||||
Net interest income |
$ 9,035 |
$ 9,010 |
$ 7,958 |
$ 8,432 |
$ 8,456 |
|||||
Provision for loan losses |
454 |
655 |
9,130 |
1,291 |
929 |
|||||
Net interest income (loss) after provision |
||||||||||
for loan losses |
$ 8,581 |
$ 8,355 |
$ (1,172) |
$ 7,141 |
$ 7,527 |
|||||
Other Income |
||||||||||
Trust services income |
$ 867 |
$ 838 |
$ 807 |
$ 875 |
$ 815 |
|||||
Service charges on deposit accounts |
489 |
488 |
487 |
468 |
441 |
|||||
Net gains (losses) on securities available for sale |
35 |
109 |
288 |
(37) |
506 |
|||||
Total other-than-temporary impairment gain (loss) on securities |
343 |
(44) |
(557) |
(97) |
(41) |
|||||
Portion of (gain) loss recognized in other comprehensive income |
(344) |
(85) |
(169) |
- |
(110) |
|||||
Net other-than-temporary impairment loss |
(1) |
(129) |
(726) |
(97) |
(151) |
|||||
Commissions on investment sales |
180 |
169 |
142 |
167 |
144 |
|||||
Bank owned life insurance |
123 |
112 |
136 |
130 |
125 |
|||||
Gain on loans held for sale |
2,847 |
5,537 |
5,147 |
3,844 |
2,630 |
|||||
Fees on loans held for sale |
154 |
570 |
477 |
476 |
358 |
|||||
Other service charges, commissions and fees |
115 |
114 |
97 |
143 |
113 |
|||||
Other operating income |
160 |
169 |
42 |
88 |
91 |
|||||
Total other income |
$ 4,969 |
$ 7,977 |
$ 6,897 |
$ 6,057 |
$ 5,072 |
|||||
Other Expense |
||||||||||
Salaries and employee benefits |
$ 7,316 |
$ 7,748 |
$ 7,464 |
$ 7,457 |
$ 6,924 |
|||||
Net occupancy expense of premises |
1,676 |
1,598 |
1,557 |
1,490 |
1,604 |
|||||
Other taxes |
197 |
200 |
201 |
201 |
196 |
|||||
Advertising |
156 |
386 |
257 |
248 |
180 |
|||||
Computer operations |
365 |
316 |
340 |
340 |
328 |
|||||
Other real estate owned |
344 |
842 |
666 |
295 |
210 |
|||||
Audits and examinations |
126 |
219 |
96 |
162 |
115 |
|||||
Legal fees |
89 |
50 |
96 |
167 |
139 |
|||||
FDIC insurance |
407 |
386 |
368 |
352 |
801 |
|||||
Other operating expenses |
1,560 |
2,401 |
3,342 |
1,554 |
1,446 |
|||||
Total other expense |
$ 12,236 |
$ 14,146 |
$ 14,387 |
$ 12,266 |
$ 11,943 |
|||||
Income (loss) before income taxes |
$ 1,314 |
$ 2,186 |
$ (8,662) |
$ 932 |
$ 656 |
|||||
Income tax expense (benefit) |
317 |
573 |
(3,297) |
75 |
87 |
|||||
Net income (loss) |
$ 997 |
$ 1,613 |
$ (5,365) |
$ 857 |
$ 569 |
|||||
Less: Net (income) loss attributable to non-controlling interest |
230 |
(51) |
(423) |
(133) |
245 |
|||||
Net income (loss) attributable to Middleburg Financial Corporation |
$ 1,227 |
$ 1,562 |
$ (5,788) |
$ 724 |
$ 814 |
|||||
Net income (loss) per common share, basic |
$ 0.18 |
$ 0.23 |
$ (0.83) |
$ 0.10 |
$ 0.12 |
|||||
Net income (loss) per common share, diluted |
$ 0.18 |
$ 0.23 |
$ (0.83) |
$ 0.10 |
$ 0.12 |
|||||
Dividends per common share |
$ 0.05 |
$ 0.05 |
0.10 |
$ 0.10 |
$ 0.10 |
|||||
MIDDLEBURG FINANCIAL CORPORATION KEY STATISTICS |
||||||||||||
(Unaudited. Dollars in thousands except per share data) |
For the Three Months Ended |
|||||||||||
Mar 31, 2011 |
Dec 31, 2010 |
Sep 30, 2010 |
Jun 30, 2010 |
Mar 31, 2010 |
||||||||
Net Income (dollars in thousands) |
$ 1,227 |
$ 1,562 |
$ (5,788) |
$ 724 |
$ 814 |
|||||||
Earnings (loss) per share, basic |
$ 0.18 |
$ 0.23 |
$ (0.83) |
$ 0.10 |
$ 0.12 |
|||||||
Earnings (loss) per share, diluted |
$ 0.18 |
$ 0.23 |
$ (0.83) |
$ 0.10 |
$ 0.12 |
|||||||
Dividend per share |
$ 0.05 |
$ 0.05 |
$ 0.10 |
$ 0.10 |
$ 0.10 |
|||||||
Return on average total assets - Year to Date |
0.46% |
-0.25% |
-2.11% |
0.28% |
0.33% |
|||||||
Return on average total equity - Year to Date |
5.11% |
-2.71% |
-22.03% |
2.85% |
3.25% |
|||||||
Dividend payout ratio |
27.78% |
22.21% |
NA |
100.00% |
84.90% |
|||||||
Non-interest revenue to total revenue (1) |
35.02% |
39.82% |
38.56% |
34.05% |
28.00% |
|||||||
Net interest margin (2) |
3.80% |
3.60% |
3.27% |
3.67% |
3.94% |
|||||||
Yield on average earning assets |
4.91% |
4.78% |
4.74% |
5.22% |
5.58% |
|||||||
Yield on average interest-bearing liabilities |
1.30% |
1.41% |
1.73% |
1.82% |
1.93% |
|||||||
Net interest spread |
3.61% |
3.37% |
3.01% |
3.40% |
3.65% |
|||||||
Non-interest income to average assets (3) |
1.82% |
2.88% |
2.69% |
2.39% |
1.93% |
|||||||
Non-interest expense to average assets (3) |
4.53% |
5.09% |
5.29% |
4.73% |
4.90% |
|||||||
Efficiency ratio - QTD (Tax Equiv) (4) |
84.96% |
81.42% |
91.77% |
81.78% |
87.85% |
|||||||
- Excludes securities gains and losses including OTTI adjustments.
- The net interest margin is calculated by dividing tax equivalent net interest income by total average earning assets. Tax equivalent net interest income is calculated by grossing up interest income for the amounts that are non taxable (i.e., municipal income) then subtracting interest expense. The tax rate utilized is 34%. The Company's net interest margin is a common measure used by the financial service industry to determine how profitably earning assets are funded. Because the Company earns a fair amount of non taxable interest income due to the mix of securities in its investment security portfolio, net interest income for the ratio is calculated on a tax equivalent basis as described above. This calculation excludes net securities gains and losses.
- Ratios are computed by dividing annualized income and expense amounts by quarterly average assets.
- The efficiency ratio is not a measurement under accounting principles generally accepted in the United States. It is calculated by dividing non interest expense by the sum of tax equivalent net interest income and non interest income excluding gains and losses on the investment portfolio. The tax rate utilized is 34%. The Company calculates this ratio in order to evaluate its overhead structure or how effectively it is operating.
MIDDLEBURG FINANCIAL CORPORATION SELECTED FINANCIAL DATA BY QUARTER |
||||||||||||
(Unaudited. Dollars in thousands except per share data) |
Mar 31, 2011 |
Dec 31, 2010 |
Sep 30, 2010 |
Jun 30, 2010 |
Mar 31, 2010 |
|||||||
BALANCE SHEET RATIOS |
||||||||||||
Loans to deposits (Including HFS) |
80.53% |
80.72% |
81.69% |
83.43% |
84.69% |
|||||||
Average interest-earning assets to |
||||||||||||
average-interest bearing liabilities |
117.58% |
118.50% |
117.22% |
117.69% |
117.51% |
|||||||
PER SHARE DATA |
||||||||||||
Dividends |
$ 0.05 |
$ 0.05 |
$ 0.10 |
$ 0.10 |
$ 0.10 |
|||||||
Book value (MFC Shareholders) |
$ 14.18 |
$ 14.02 |
$ 14.22 |
$ 14.84 |
$ 14.65 |
|||||||
Tangible book value (3) |
$ 13.27 |
$ 13.10 |
$ 13.29 |
$ 13.91 |
$ 13.71 |
|||||||
SHARE PRICE DATA |
||||||||||||
Closing price |
$ 17.75 |
$ 14.26 |
$ 14.08 |
$ 13.91 |
$ 15.06 |
|||||||
Diluted earnings multiple (1) |
24.65 |
15.50 |
NA |
34.78 |
31.38 |
|||||||
Book value multiple(2) |
1.25 |
1.02 |
0.99 |
0.94 |
1.03 |
|||||||
COMMON STOCK DATA |
||||||||||||
Outstanding shares at end of period |
6,942,315 |
6,925,437 |
6,915,687 |
6,914,687 |
6,909,293 |
|||||||
Weighted average shares O/S Basic - QTD |
6,940,154 |
6,937,801 |
6,934,366 |
6,911,744 |
6,909,293 |
|||||||
Weighted average shares O/S, diluted - QTD |
6,943,189 |
6,938,359 |
6,934,366 |
6,924,338 |
6,912,173 |
|||||||
CAPITAL RATIOS |
||||||||||||
Capital to Assets - Common shareholders |
9.08% |
8.79% |
8.85% |
9.67% |
9.94% |
|||||||
Capital to Assets - with Noncontrolling Interest |
9.33% |
9.05% |
9.13% |
9.92% |
10.20% |
|||||||
Tangible common equity ratio (4) |
8.54% |
8.26% |
8.32% |
9.11% |
9.36% |
|||||||
Total risk based capital ratio |
14.59% |
14.10% |
13.54% |
14.58% |
15.02% |
|||||||
Tier 1 risk based capital ratio |
13.33% |
12.84% |
12.29% |
13.33% |
13.77% |
|||||||
Leverage ratio |
9.37% |
9.04% |
9.08% |
10.58% |
10.71% |
|||||||
CREDIT QUALITY |
||||||||||||
Net charge-offs to average loans |
0.12% |
0.22% |
0.47% |
0.15% |
0.04% |
|||||||
Total non-performing loans to total portfolio loans |
5.36% |
4.66% |
4.69% |
2.81% |
2.00% |
|||||||
Total non-performing assets to total assets |
3.99% |
3.54% |
3.50% |
2.64% |
1.88% |
|||||||
Non-accrual loans to: |
||||||||||||
total loans |
4.17% |
4.46% |
4.57% |
1.87% |
1.46% |
|||||||
total assets |
2.55% |
2.66% |
2.69% |
1.15% |
0.94% |
|||||||
Allowance for loan losses to: |
||||||||||||
total portfolio loans |
2.20% |
2.27% |
2.42% |
1.54% |
1.50% |
|||||||
non-performing assets |
33.65% |
38.29% |
40.84% |
35.98% |
51.43% |
|||||||
non-accrual loans |
52.74% |
50.93% |
53.04% |
82.51% |
102.67% |
|||||||
NON-PERFORMING ASSETS: |
||||||||||||
Loans delinquent over 90 days and still accruing |
$ 6,593 |
$ 909 |
$ 388 |
$ 6,188 |
$ 3,544 |
|||||||
Non-accrual loans |
27,638 |
29,385 |
29,923 |
12,211 |
9,613 |
|||||||
Restructured Loans |
1,254 |
1,254 |
404 |
1,346 |
- |
|||||||
Other real estate owned and repossessed assets |
7,825 |
8,394 |
8,142 |
8,257 |
6,034 |
|||||||
Total non-performing assets |
$ 43,310 |
$ 39,942 |
$ 38,857 |
$ 28,002 |
$ 19,191 |
|||||||
NET LOAN CHARGE-OFFS: |
||||||||||||
Loans charged off |
$ 933 |
$ 1,600 |
$ 3,351 |
$ 1,142 |
$ 291 |
|||||||
(Recoveries) |
(87) |
(42) |
(16) |
(56) |
(47) |
|||||||
Net charge-offs |
$ 846 |
$ 1,558 |
$ 3,335 |
$ 1,086 |
$ 244 |
|||||||
PROVISION FOR LOAN LOSSES |
$ 454 |
$ 655 |
$ 9,130 |
$ 1,291 |
$ 929 |
|||||||
ALLOWANCE FOR LOAN LOSS SUMMARY |
||||||||||||
Balance at the beginning of period |
$ 14,967 |
$ 15,870 |
$ 10,075 |
$ 9,870 |
$ 9,185 |
|||||||
Provision |
454 |
655 |
9,130 |
1,291 |
929 |
|||||||
Net charge-offs |
(846) |
(1,558) |
(3,335) |
(1,086) |
(244) |
|||||||
Balance at the end of period |
$ 14,575 |
$ 14,967 |
$ 15,870 |
$ 10,075 |
$ 9,870 |
|||||||
- The diluted earnings multiple is calculated by dividing the period's closing market price per share by the annualized diluted earnings per share for the period. The diluted earnings multiple is a measure of how much an investor may be willing to pay for $1.00 of the Company's earnings. In quarters where the Company incurs net losses, the diluted earnings multiple is not meaningful and is shown as "NA".
- The book value multiple (or price to book ratio) is calculated by dividing the period's closing market price per share by the period's book value per share. The book value multiple is a measure used to compare the Company's market value per share to its book value per share.
- Tangible book value is not a measurement under accounting principles generally accepted in the United States. It is computed by subtracting identified intangible assets and goodwill from total Middleburg Financial Corporation shareholders' equity and then dividing the result by the number of shares of common stock issued and outstanding at the end of the accounting period.
- The tangible common equity ratio is not a measurement under accounting principles generally accepted in the United States. It is computed by subtracting identified intangible assets and goodwill from total Middleburg Financial Corporation shareholders' equity and total assets and then dividing the adjusted shareholders' equity balance by the adjusted total asset balance.
Average Balances, Income and Expenses, Yields and Rates |
||||||||||||
Three Months Ended March 31 |
||||||||||||
2011 |
2010 |
|||||||||||
Average |
Income/ |
Yield/ |
Average |
Income/ |
Yield/ |
|||||||
Balance |
Expense |
Rate (2) |
Balance |
Expense |
Rate (2) |
|||||||
(Dollars in thousands) |
||||||||||||
Assets : |
||||||||||||
Securities: |
||||||||||||
Taxable |
$ 204,725 |
$ 1,435 |
2.84% |
$ 119,744 |
$ 959 |
3.25% |
||||||
Tax-exempt (1) |
53,974 |
850 |
6.39% |
63,929 |
1,050 |
6.66% |
||||||
Total securities |
$ 258,699 |
$ 2,285 |
3.58% |
$ 183,673 |
$ 2,009 |
4.44% |
||||||
Loans |
||||||||||||
Taxable |
$ 694,628 |
$ 9,735 |
5.68% |
$ 678,854 |
$ 10,445 |
6.24% |
||||||
Total loans (3) |
$ 694,628 |
$ 9,735 |
5.68% |
$ 678,854 |
$ 10,445 |
6.24% |
||||||
Federal funds sold |
- |
- |
0.00% |
- |
- |
0.00% |
||||||
Interest bearing deposits in |
||||||||||||
other financial institutions |
41,980 |
27 |
0.26% |
44,677 |
35 |
0.32% |
||||||
Total earning assets |
$ 995,307 |
$ 12,047 |
4.91% |
$ 907,204 |
$ 12,489 |
5.58% |
||||||
Less: allowances for credit losses |
(14,747) |
(9,104) |
||||||||||
Total nonearning assets |
95,185 |
90,757 |
||||||||||
Total assets |
$ 1,075,745 |
$ 988,857 |
||||||||||
Liabilities: |
||||||||||||
Interest-bearing deposits: |
||||||||||||
Checking |
$ 287,005 |
$ 486 |
0.69% |
$ 279,655 |
$ 601 |
0.87% |
||||||
Regular savings |
89,650 |
187 |
0.85% |
70,393 |
183 |
1.05% |
||||||
Money market savings |
60,872 |
101 |
0.67% |
50,957 |
115 |
0.92% |
||||||
Time deposits: |
||||||||||||
$100,000 and over |
130,641 |
605 |
1.88% |
161,447 |
1,152 |
2.89% |
||||||
Under $100,000 |
168,537 |
929 |
2.24% |
136,953 |
1,123 |
3.33% |
||||||
Total interest-bearing deposits |
$ 736,705 |
$ 2,308 |
1.27% |
$ 699,405 |
$ 3,174 |
1.84% |
||||||
Short-term borrowings |
5,739 |
63 |
4.45% |
4,843 |
44 |
3.68% |
||||||
Securities sold under agreements |
||||||||||||
to repurchase |
29,308 |
56 |
0.77% |
21,643 |
20 |
0.37% |
||||||
Long-term debt |
74,734 |
296 |
1.61% |
46,136 |
438 |
3.85% |
||||||
Total interest-bearing liabilities |
$ 846,486 |
$ 2,723 |
1.30% |
$ 772,027 |
$ 3,676 |
1.93% |
||||||
Non-interest bearing liabilities |
||||||||||||
Demand Deposits |
122,118 |
105,994 |
||||||||||
Other liabilities |
6,873 |
6,563 |
||||||||||
Total liabilities |
$ 975,477 |
$ 884,584 |
||||||||||
Non-controlling interest |
2,830 |
2,725 |
||||||||||
Shareholders' equity |
97,438 |
101,548 |
||||||||||
Total liabilities and shareholders' |
||||||||||||
equity |
$ 1,075,745 |
$ 988,857 |
||||||||||
Net interest income |
$ 9,324 |
$ 8,813 |
||||||||||
Interest rate spread |
3.61% |
3.65% |
||||||||||
Cost of funds |
1.14% |
1.70% |
||||||||||
Interest expense as a percent of |
||||||||||||
average earning assets |
1.11% |
1.64% |
||||||||||
Net interest margin |
3.80% |
3.94% |
||||||||||
(1) Income and yields are reported on tax equivalent basis assuming a federal tax rate of 34%. |
||||||||||||
(2) All yields and rates have been annualized on a 365 day year. |
||||||||||||
(3) Total average loans include loans on non-accrual status. |
||||||||||||
SOURCE Middleburg Financial Corporation
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