Provident Bankshares Corporation Announces Operating Earnings for the 2001 First Quarter

Core Banking Businesses Continue to Drive Strong Revenue Performance



Apr 18, 2001, 01:00 ET from Provident Bankshares Corporation

    BALTIMORE, April 18 /PRNewswire/ --
 Provident Bankshares Corporation (Nasdaq:   PBKS), the parent company of
 Provident Bank, the second largest independent commercial bank headquartered
 in Maryland, today reported operating earnings of $11.7 million or $.45 per
 share.
     These solid operating results were driven by the strong performance of the
 Company's core banking businesses.  The quarter was highlighted by a 26.2%
 increase in fee income, a 12.4% growth in average core deposits, a 31.4%
 increase in average commercial real estate loans and continued focus on
 operating expense control, which limited growth in non-interest expense to
 2.4%.
 
     First Quarter Financial Highlights
 
     -- Earnings per share (diluted) were $.45
     -- Operating earnings were $11.7 million for the quarter
     -- Return on average common equity was 15.34% for the quarter
     -- Average core deposits increased 12.4%
     -- Average core loans increased $164 million or 12.7%
     -- Cash dividend was increased to $.19 per share
     -- Non-interest income (excluding securities gains) grew 23.0% for the
         quarter compared to first quarter 2000 and comprised 32% of
         Provident's total income (net of securities gains) for the quarter
 
     First Quarter Strategic Highlights
 
     -- Increased average core deposits $273 million or 12.4% from the first
         quarter of 2000
     -- Increased fee income 26.2%, up from $11.8 million in first quarter
         2000
     -- Direct consumer loan production increased 64% over first quarter 2000
     -- Expanded commercial business with commercial deposits up $27.1 million
         or 13.2% and average commercial loans bankwide were up $106 million
         or 14.1% compared to first quarter 2000
     -- Opened more than 21,000 retail checking accounts during the quarter, a
         4.50% increase from first quarter 2000
     -- Repurchased 1.6 million shares during the quarter under the current
         stock buyback program, including more than 1.4 million PBKS shares
         held by Mid-Atlantic Investors and its affiliates
 
     First Quarter Operating Results
     Provident Bankshares today reported operating earnings for the quarter
 ended March 31, 2001 of $11.7 million, or $.45 per share on a diluted basis.
 This is an increase of 7.9% from $10.9 million, or $.40 per diluted share in
 the 2000 comparable quarter.
     As a result of a one-time transition adjustment of $1.2 million (net of
 taxes) for Statement of Financial Accounting Standards No. 133 "Accounting of
 Derivative Instruments and Hedging Activities," net income is $10.6 million,
 or $.40 per diluted share.
     The Company, like many institutions, adopted these new mandatory
 accounting standards in the first quarter of 2001.
     Exclusive of accounting change, return on average common equity was 15.34%
 for the first quarter 2001, compared to 14.72% in the same quarter a year ago
 and 15.42% from the prior quarter.  Return on average assets was .88% for the
 quarter ending March 31, 2001, compared to .90% for the quarter ending
 March 31, 2000 and .89% for the quarter ending December 31, 2000.
     Net interest margin for the 2001 first quarter was 2.91%, a decrease from
 3.04% in the fourth quarter of 2000.  This margin decline was largely the
 result of two one-time events: the reclassification of trust preferred stock
 interest from non-interest expense to interest expense, and the accelerated
 reversal of $1.4 million in accrued interest to comply with the new FFIEC
 policy for consumer credit that required the reclassification of previously
 unclassified second mortgages as non-performing loans.
     Non-interest income (excluding securities gains) was up $3.3 million or
 23.0% for the 2001 first quarter.  There were $6.0 million in securities gains
 during the 2001 first quarter compared to $79 thousand in the same period a
 year ago.  Securities gains were taken mainly as part of Provident's program
 to hedge accelerated prepayments on the second mortgage portfolio as well as
 to fund the sale of a non-performing health care credit.
     Core banking operations continued to show solid revenue growth driven by
 Provident's strength in attracting and retaining customers, generating fee
 income and acquiring core deposits.
     Led by a strong increase in deposit service fees associated with
 Provident's continued growth in retail and commercial checking accounts, non-
 interest income from core business operations was up $3.3 million or 23.0% for
 the quarter ending March 31, 2001.  Income from deposit service fees was up
 more than $3.3 million or 31.5% from one year ago.
     Average loans and deposits showed strong growth in first quarter 2001
 compared to 2000.  Average core loans increased $164 million or 12.7%.  Led by
 a strong increase in non-interest bearing demand deposits, average core
 deposits increased 12.4% from the first quarter of 2000.
     The Company's commitment to expense control was evidenced by a 2.4%
 increase in non-interest expense, up $849 thousand from the same quarter last
 year.  Expansion branches (open less than eighteen months) continued their
 progress toward break-even status, recording $955 thousand in net fee income
 growth during the quarter while limiting operating expense growth to just over
 $1 million.
     Provident continued to use its stock buyback authority to strategically
 purchase shares in the open market to enhance stockholder value.  The Company
 repurchased 1.6 million shares during the quarter, including all of the
 1,407,157 PBKS shares held by Mid-Atlantic Investors and its affiliates.  This
 transaction accelerated the completion of a substantial portion of the
 Company's share repurchase program within the price range approved by its
 Board of Directors in December 2000.  The Company has remaining authority to
 repurchase up to 920,000 of common stock under the current repurchase program.
 
     Asset Quality
     The Company remains confident of its asset quality based on regular
 monitoring of all its loan portfolios.  As a result of this management
 process, the Company took the following actions during the quarter.
     Provident continued to reduce its syndicated health care portfolio by
 selling its remaining position in a previously reported non-performing
 healthcare credit.  To further limit its exposure to syndicated credits, the
 Company also elected to sell a large national credit that had been performing
 as agreed at face value.
     A one-time addition of $12 million was made to non-performing loans to
 conform to a new FFIEC policy on consumer loans.  While there has been no
 change in the underlying fundamentals of Provident's consumer loan portfolio,
 the new FFIEC policy required the reclassification of previously unclassified
 second mortgages as non-performing loans.
     At March 31, 2001, the allowance for loan losses stood at $42.8 million.
 
     Dividend Declared
     Provident Bankshares also announced today that its Board of Directors has
 declared a quarterly cash dividend of $.19 per share.  This quarterly cash
 dividend will be paid on May 11, 2001 to stockholders of record at the close
 of business on April 30, 2001.
     In addition, the Board declared a stock dividend of 5% per share.  This
 stock dividend will also be paid on May 11, 2001, subsequent to the cash
 dividend, to stockholders of record at the close of business on April 30,
 2001.
 
     Management Comment
     Commenting on the first quarter, Provident Bankshares Chairman and CEO
 Peter M. Martin said, "I'm pleased with the performance of our core banking
 units.  Their continued growth and solid earnings results provided significant
 revenue momentum for our operations this quarter.
     "We continue to focus efforts on our most profitable business lines.  We
 also launched a number of new business initiatives this quarter as part of our
 specific core banking growth strategies."
 
     New Business Initiatives
     Provident's Baltimore Commercial Banking team embarked on a significant
 prospect-calling program during the quarter.  Teams of commercial lenders
 traveled the Baltimore metro market to increase market awareness, qualify
 prospects and acquire new customers.  The target businesses for the call blitz
 had revenues of $5 million or greater, and loan needs of $250,000 and up.
 Over 500 calls were made during the quarter as the first step towards
 intensifying efforts to attain a larger portion of the commercial market
 share.
     Provident also took steps to become a significant player in the small
 business banking arena.  A new small business unit was finalized and staffed
 during the quarter with highly experienced employees from the organization.
 An expanded product mix, including new business checking products, will enable
 Provident to meet a complete range of financial needs for the small business
 customer.
     Provident will continue to expand its branch network into attractive
 markets this year.  Six branches are due to open in 2001, with four scheduled
 for the dynamic Northern Virginia area.  During this quarter, expansion
 branches deposits grew to $69 million compared to $9.4 million at the close of
 the first quarter of 2000.  Fee income from expansion branches totaled more
 than $1.3 million for the quarter, up 293% from $326 thousand for the same
 period last year.  Expansion branches contributed 17% of bankwide fee income
 and added 31% of total retail banking fee income.
     A retooled home equity product line generated over $9.2 million of new
 lines during the quarter, an 88% increase from first quarter 2000.  Provident
 produced $71 million in consumer loans during the first quarter of 2001, a 64%
 increase over first quarter 2000.
 
     Solid Results from a Proven Performer
     Commenting on the outlook for Provident Bankshares, Peter Martin said, "We
 will continue to implement our successful core banking strategies with
 specific goals in 2001 to meet our financial targets, enhance our commercial
 banking businesses and continue our strong growth in core deposits and non-
 interest income.  I am confident we will meet the consensus earnings estimate
 for 2001."
 
     Provident Bankshares Corporation is the holding company for Provident
 Bank, the second largest independent commercial bank headquartered in
 Maryland.  With $5.3 billion in assets, Provident serves individuals and
 businesses in the dynamic Baltimore-Washington corridor through a network of
 98 offices in Maryland, Northern Virginia, and southern York County, PA.
 Provident Bank also offers related financial services through its wholly owned
 subsidiaries.  Mutual funds, annuities and insurance products are available
 through Provident Investment Center and leases through Court Square Leasing
 and Provident Lease Corp.  Visit Provident on the web at www.provbank.com.
 
     Special Note:  Provident Bankshares Corporation's First Quarter Earnings
 Teleconference will be webcast at 10:00 a.m. on Thursday, April 19, 2001.  Log
 on to www.provbank.com.  The webcast will involve discussions of the most
 recent quarter's results of operations and may include forward-looking
 information, such as guidance of future results.
 
     Statements contained in this Press Release that are not historical facts
 are forward-looking statements, as the term is defined in the Private
 Securities Litigation Reform Act of 1995.  Such forward-looking statements are
 subject to risks and uncertainties which could cause actual results to differ
 materially from those currently anticipated due to a number of factors, which
 include, but are not limited to, factors discussed in documents filed by the
 Company with the Securities and Exchange Commission from time to time.
 
 
     PROVIDENT BANKSHARES CORPORATION
     FINANCIAL SUMMARY
 
     (dollars in thousands, except
     per share data)                    Three Months Ended March 31,
     (tax-equivalent basis)             2001         2000   % Change
     SUMMARY OF OPERATIONS
     Interest Income                  $97,760      $98,255     (0.5)%
     Interest Expense                  60,654       57,595      5.3
       Net Interest Income             37,106       40,660     (8.7)
     Provision for Loan Losses          7,175        4,300     66.9
       Net Interest Income after
        Provision
        for Loan Losses                29,931       36,360    (17.7)
     Non-Interest Income               23,537       14,369     63.8
 
     Non-Interest Expense              35,878       35,029      2.4
       Income Before Income Taxes      17,590       15,700     12.0
     Income Tax Expense                 5,610        4,594     22.1
     Less: Tax-Equivalent
      Adjustment                          255          241      5.8
     Income Before Extraordinary
      Item and Cumulative
      Effect of Change in
      Accounting Principle             11,725       10,865      7.9
     Extraordinary Item -- Gain on
      Debt Extinguishment, Net              -          770        -
     Cumulative Effect of Change
      in Accounting Principle,
      Net*                             (1,160)           -        -
     Net Income                       $10,565      $11,635     (9.2)
 
     PER SHARE
       Basic
       Income Before Extraordinary
        Item and Cumulative
        Effect of Change in
        Accounting Principle            $0.47        $0.41
       Net Income                        0.42         0.44
       Diluted
       Income Before Extraordinary
        Item and Cumulative
        Effect of Change in
        Accounting Principle             0.45         0.40
       Net Income                        0.40         0.43
 
     Cash Dividends Paid                0.185        0.157
     Stockholders' Equity               11.97        10.94
     Market Value (closing sales
      price as
        reported on the NASDAQ
         Stock Market)                  22.38        15.00
     Common Shares Outstanding     24,400,891   25,073,952
     Weighted Average Shares --
      Basic                        25,125,278   26,619,994
     Weighted Average Shares --
      Diluted                      26,091,147   27,142,033
     PROFITABILITY RATIOS**
     Return on Average Assets            0.88 %       0.90 %
     Return on Average Equity           15.66        17.33
     Return on Average Common
      Equity                            15.34        14.72
     Net Yield on Average Earning
      Assets (t/e basis)                 2.91         3.23
     CAPITAL RATIOS AT MARCH 31
     Leverage Ratio                      6.62 %       7.44 %
     Risk-Based Capital Ratios:
        Tier I Capital Ratio             9.01         9.69
        Total Capital Ratio             10.06        10.71
     ASSET QUALITY
     Non-Performing Loans             $26,038      $26,000      0.1 %
     Loans Past Due 90 Days or
      More                             27,576       28,512     (3.3)
     Allowance for Loan Losses         42,832       41,051      4.3
     Net Charge-offs                    5,003        3,029     65.2
     Non-Performing Loans to Loans       0.79 %       0.78 %
     Allowance for Loan Losses to
      Loans                              1.29         1.23
     Net Charge-Offs to Average
      Loans                              0.60         0.37
     Allowance for Loan Losses to
        Non-Performing Loans           164.50       157.89
     AVERAGE BALANCES
     Investment Securities
      Portfolio                    $1,765,614   $1,738,383      1.6 %
     Loans                          3,390,557    3,275,491      3.5
     Earning Assets                 5,169,377    5,060,376      2.2
     Assets                         5,382,555    5,227,759      3.0
     Deposits                       3,842,611    3,791,779      1.3
     Stockholders' Equity             303,633      270,069     12.4
     Common Equity                    310,044      318,010     (2.5)
     SELECTED FINANCIAL DATA AT
      PERIOD END
     Investment Securities
      Portfolio                    $1,639,388   $1,686,192     (2.8)%
     Loans                          3,314,795    3,348,247     (1.0)
     Earning Assets                 4,972,130    5,049,902     (1.5)
     Assets                         5,252,379    5,247,507      0.1
     Deposits                       3,808,215    3,782,312      0.7
     Stockholders' Equity             292,035      274,405      6.4
     Common Equity                    295,931      319,089     (7.3)
 
     *  Effective January 1, 2001, the Corporation adopted SFAS No. 133,
         "Accounting for Derivative Instruments and Hedging Activities"
     ** Exclusive of cumulative effect of change in accounting principle
 
 

SOURCE Provident Bankshares Corporation
    BALTIMORE, April 18 /PRNewswire/ --
 Provident Bankshares Corporation (Nasdaq:   PBKS), the parent company of
 Provident Bank, the second largest independent commercial bank headquartered
 in Maryland, today reported operating earnings of $11.7 million or $.45 per
 share.
     These solid operating results were driven by the strong performance of the
 Company's core banking businesses.  The quarter was highlighted by a 26.2%
 increase in fee income, a 12.4% growth in average core deposits, a 31.4%
 increase in average commercial real estate loans and continued focus on
 operating expense control, which limited growth in non-interest expense to
 2.4%.
 
     First Quarter Financial Highlights
 
     -- Earnings per share (diluted) were $.45
     -- Operating earnings were $11.7 million for the quarter
     -- Return on average common equity was 15.34% for the quarter
     -- Average core deposits increased 12.4%
     -- Average core loans increased $164 million or 12.7%
     -- Cash dividend was increased to $.19 per share
     -- Non-interest income (excluding securities gains) grew 23.0% for the
         quarter compared to first quarter 2000 and comprised 32% of
         Provident's total income (net of securities gains) for the quarter
 
     First Quarter Strategic Highlights
 
     -- Increased average core deposits $273 million or 12.4% from the first
         quarter of 2000
     -- Increased fee income 26.2%, up from $11.8 million in first quarter
         2000
     -- Direct consumer loan production increased 64% over first quarter 2000
     -- Expanded commercial business with commercial deposits up $27.1 million
         or 13.2% and average commercial loans bankwide were up $106 million
         or 14.1% compared to first quarter 2000
     -- Opened more than 21,000 retail checking accounts during the quarter, a
         4.50% increase from first quarter 2000
     -- Repurchased 1.6 million shares during the quarter under the current
         stock buyback program, including more than 1.4 million PBKS shares
         held by Mid-Atlantic Investors and its affiliates
 
     First Quarter Operating Results
     Provident Bankshares today reported operating earnings for the quarter
 ended March 31, 2001 of $11.7 million, or $.45 per share on a diluted basis.
 This is an increase of 7.9% from $10.9 million, or $.40 per diluted share in
 the 2000 comparable quarter.
     As a result of a one-time transition adjustment of $1.2 million (net of
 taxes) for Statement of Financial Accounting Standards No. 133 "Accounting of
 Derivative Instruments and Hedging Activities," net income is $10.6 million,
 or $.40 per diluted share.
     The Company, like many institutions, adopted these new mandatory
 accounting standards in the first quarter of 2001.
     Exclusive of accounting change, return on average common equity was 15.34%
 for the first quarter 2001, compared to 14.72% in the same quarter a year ago
 and 15.42% from the prior quarter.  Return on average assets was .88% for the
 quarter ending March 31, 2001, compared to .90% for the quarter ending
 March 31, 2000 and .89% for the quarter ending December 31, 2000.
     Net interest margin for the 2001 first quarter was 2.91%, a decrease from
 3.04% in the fourth quarter of 2000.  This margin decline was largely the
 result of two one-time events: the reclassification of trust preferred stock
 interest from non-interest expense to interest expense, and the accelerated
 reversal of $1.4 million in accrued interest to comply with the new FFIEC
 policy for consumer credit that required the reclassification of previously
 unclassified second mortgages as non-performing loans.
     Non-interest income (excluding securities gains) was up $3.3 million or
 23.0% for the 2001 first quarter.  There were $6.0 million in securities gains
 during the 2001 first quarter compared to $79 thousand in the same period a
 year ago.  Securities gains were taken mainly as part of Provident's program
 to hedge accelerated prepayments on the second mortgage portfolio as well as
 to fund the sale of a non-performing health care credit.
     Core banking operations continued to show solid revenue growth driven by
 Provident's strength in attracting and retaining customers, generating fee
 income and acquiring core deposits.
     Led by a strong increase in deposit service fees associated with
 Provident's continued growth in retail and commercial checking accounts, non-
 interest income from core business operations was up $3.3 million or 23.0% for
 the quarter ending March 31, 2001.  Income from deposit service fees was up
 more than $3.3 million or 31.5% from one year ago.
     Average loans and deposits showed strong growth in first quarter 2001
 compared to 2000.  Average core loans increased $164 million or 12.7%.  Led by
 a strong increase in non-interest bearing demand deposits, average core
 deposits increased 12.4% from the first quarter of 2000.
     The Company's commitment to expense control was evidenced by a 2.4%
 increase in non-interest expense, up $849 thousand from the same quarter last
 year.  Expansion branches (open less than eighteen months) continued their
 progress toward break-even status, recording $955 thousand in net fee income
 growth during the quarter while limiting operating expense growth to just over
 $1 million.
     Provident continued to use its stock buyback authority to strategically
 purchase shares in the open market to enhance stockholder value.  The Company
 repurchased 1.6 million shares during the quarter, including all of the
 1,407,157 PBKS shares held by Mid-Atlantic Investors and its affiliates.  This
 transaction accelerated the completion of a substantial portion of the
 Company's share repurchase program within the price range approved by its
 Board of Directors in December 2000.  The Company has remaining authority to
 repurchase up to 920,000 of common stock under the current repurchase program.
 
     Asset Quality
     The Company remains confident of its asset quality based on regular
 monitoring of all its loan portfolios.  As a result of this management
 process, the Company took the following actions during the quarter.
     Provident continued to reduce its syndicated health care portfolio by
 selling its remaining position in a previously reported non-performing
 healthcare credit.  To further limit its exposure to syndicated credits, the
 Company also elected to sell a large national credit that had been performing
 as agreed at face value.
     A one-time addition of $12 million was made to non-performing loans to
 conform to a new FFIEC policy on consumer loans.  While there has been no
 change in the underlying fundamentals of Provident's consumer loan portfolio,
 the new FFIEC policy required the reclassification of previously unclassified
 second mortgages as non-performing loans.
     At March 31, 2001, the allowance for loan losses stood at $42.8 million.
 
     Dividend Declared
     Provident Bankshares also announced today that its Board of Directors has
 declared a quarterly cash dividend of $.19 per share.  This quarterly cash
 dividend will be paid on May 11, 2001 to stockholders of record at the close
 of business on April 30, 2001.
     In addition, the Board declared a stock dividend of 5% per share.  This
 stock dividend will also be paid on May 11, 2001, subsequent to the cash
 dividend, to stockholders of record at the close of business on April 30,
 2001.
 
     Management Comment
     Commenting on the first quarter, Provident Bankshares Chairman and CEO
 Peter M. Martin said, "I'm pleased with the performance of our core banking
 units.  Their continued growth and solid earnings results provided significant
 revenue momentum for our operations this quarter.
     "We continue to focus efforts on our most profitable business lines.  We
 also launched a number of new business initiatives this quarter as part of our
 specific core banking growth strategies."
 
     New Business Initiatives
     Provident's Baltimore Commercial Banking team embarked on a significant
 prospect-calling program during the quarter.  Teams of commercial lenders
 traveled the Baltimore metro market to increase market awareness, qualify
 prospects and acquire new customers.  The target businesses for the call blitz
 had revenues of $5 million or greater, and loan needs of $250,000 and up.
 Over 500 calls were made during the quarter as the first step towards
 intensifying efforts to attain a larger portion of the commercial market
 share.
     Provident also took steps to become a significant player in the small
 business banking arena.  A new small business unit was finalized and staffed
 during the quarter with highly experienced employees from the organization.
 An expanded product mix, including new business checking products, will enable
 Provident to meet a complete range of financial needs for the small business
 customer.
     Provident will continue to expand its branch network into attractive
 markets this year.  Six branches are due to open in 2001, with four scheduled
 for the dynamic Northern Virginia area.  During this quarter, expansion
 branches deposits grew to $69 million compared to $9.4 million at the close of
 the first quarter of 2000.  Fee income from expansion branches totaled more
 than $1.3 million for the quarter, up 293% from $326 thousand for the same
 period last year.  Expansion branches contributed 17% of bankwide fee income
 and added 31% of total retail banking fee income.
     A retooled home equity product line generated over $9.2 million of new
 lines during the quarter, an 88% increase from first quarter 2000.  Provident
 produced $71 million in consumer loans during the first quarter of 2001, a 64%
 increase over first quarter 2000.
 
     Solid Results from a Proven Performer
     Commenting on the outlook for Provident Bankshares, Peter Martin said, "We
 will continue to implement our successful core banking strategies with
 specific goals in 2001 to meet our financial targets, enhance our commercial
 banking businesses and continue our strong growth in core deposits and non-
 interest income.  I am confident we will meet the consensus earnings estimate
 for 2001."
 
     Provident Bankshares Corporation is the holding company for Provident
 Bank, the second largest independent commercial bank headquartered in
 Maryland.  With $5.3 billion in assets, Provident serves individuals and
 businesses in the dynamic Baltimore-Washington corridor through a network of
 98 offices in Maryland, Northern Virginia, and southern York County, PA.
 Provident Bank also offers related financial services through its wholly owned
 subsidiaries.  Mutual funds, annuities and insurance products are available
 through Provident Investment Center and leases through Court Square Leasing
 and Provident Lease Corp.  Visit Provident on the web at www.provbank.com.
 
     Special Note:  Provident Bankshares Corporation's First Quarter Earnings
 Teleconference will be webcast at 10:00 a.m. on Thursday, April 19, 2001.  Log
 on to www.provbank.com.  The webcast will involve discussions of the most
 recent quarter's results of operations and may include forward-looking
 information, such as guidance of future results.
 
     Statements contained in this Press Release that are not historical facts
 are forward-looking statements, as the term is defined in the Private
 Securities Litigation Reform Act of 1995.  Such forward-looking statements are
 subject to risks and uncertainties which could cause actual results to differ
 materially from those currently anticipated due to a number of factors, which
 include, but are not limited to, factors discussed in documents filed by the
 Company with the Securities and Exchange Commission from time to time.
 
 
     PROVIDENT BANKSHARES CORPORATION
     FINANCIAL SUMMARY
 
     (dollars in thousands, except
     per share data)                    Three Months Ended March 31,
     (tax-equivalent basis)             2001         2000   % Change
     SUMMARY OF OPERATIONS
     Interest Income                  $97,760      $98,255     (0.5)%
     Interest Expense                  60,654       57,595      5.3
       Net Interest Income             37,106       40,660     (8.7)
     Provision for Loan Losses          7,175        4,300     66.9
       Net Interest Income after
        Provision
        for Loan Losses                29,931       36,360    (17.7)
     Non-Interest Income               23,537       14,369     63.8
 
     Non-Interest Expense              35,878       35,029      2.4
       Income Before Income Taxes      17,590       15,700     12.0
     Income Tax Expense                 5,610        4,594     22.1
     Less: Tax-Equivalent
      Adjustment                          255          241      5.8
     Income Before Extraordinary
      Item and Cumulative
      Effect of Change in
      Accounting Principle             11,725       10,865      7.9
     Extraordinary Item -- Gain on
      Debt Extinguishment, Net              -          770        -
     Cumulative Effect of Change
      in Accounting Principle,
      Net*                             (1,160)           -        -
     Net Income                       $10,565      $11,635     (9.2)
 
     PER SHARE
       Basic
       Income Before Extraordinary
        Item and Cumulative
        Effect of Change in
        Accounting Principle            $0.47        $0.41
       Net Income                        0.42         0.44
       Diluted
       Income Before Extraordinary
        Item and Cumulative
        Effect of Change in
        Accounting Principle             0.45         0.40
       Net Income                        0.40         0.43
 
     Cash Dividends Paid                0.185        0.157
     Stockholders' Equity               11.97        10.94
     Market Value (closing sales
      price as
        reported on the NASDAQ
         Stock Market)                  22.38        15.00
     Common Shares Outstanding     24,400,891   25,073,952
     Weighted Average Shares --
      Basic                        25,125,278   26,619,994
     Weighted Average Shares --
      Diluted                      26,091,147   27,142,033
     PROFITABILITY RATIOS**
     Return on Average Assets            0.88 %       0.90 %
     Return on Average Equity           15.66        17.33
     Return on Average Common
      Equity                            15.34        14.72
     Net Yield on Average Earning
      Assets (t/e basis)                 2.91         3.23
     CAPITAL RATIOS AT MARCH 31
     Leverage Ratio                      6.62 %       7.44 %
     Risk-Based Capital Ratios:
        Tier I Capital Ratio             9.01         9.69
        Total Capital Ratio             10.06        10.71
     ASSET QUALITY
     Non-Performing Loans             $26,038      $26,000      0.1 %
     Loans Past Due 90 Days or
      More                             27,576       28,512     (3.3)
     Allowance for Loan Losses         42,832       41,051      4.3
     Net Charge-offs                    5,003        3,029     65.2
     Non-Performing Loans to Loans       0.79 %       0.78 %
     Allowance for Loan Losses to
      Loans                              1.29         1.23
     Net Charge-Offs to Average
      Loans                              0.60         0.37
     Allowance for Loan Losses to
        Non-Performing Loans           164.50       157.89
     AVERAGE BALANCES
     Investment Securities
      Portfolio                    $1,765,614   $1,738,383      1.6 %
     Loans                          3,390,557    3,275,491      3.5
     Earning Assets                 5,169,377    5,060,376      2.2
     Assets                         5,382,555    5,227,759      3.0
     Deposits                       3,842,611    3,791,779      1.3
     Stockholders' Equity             303,633      270,069     12.4
     Common Equity                    310,044      318,010     (2.5)
     SELECTED FINANCIAL DATA AT
      PERIOD END
     Investment Securities
      Portfolio                    $1,639,388   $1,686,192     (2.8)%
     Loans                          3,314,795    3,348,247     (1.0)
     Earning Assets                 4,972,130    5,049,902     (1.5)
     Assets                         5,252,379    5,247,507      0.1
     Deposits                       3,808,215    3,782,312      0.7
     Stockholders' Equity             292,035      274,405      6.4
     Common Equity                    295,931      319,089     (7.3)
 
     *  Effective January 1, 2001, the Corporation adopted SFAS No. 133,
         "Accounting for Derivative Instruments and Hedging Activities"
     ** Exclusive of cumulative effect of change in accounting principle
 
 SOURCE  Provident Bankshares Corporation