ANNAPOLIS, Md., Nov. 18 /PRNewswire-FirstCall/ -- Severn Bancorp, Inc,
(Nasdaq: SVBI) parent company of Severn Savings Bank FSB ("Severn"), announced
today that it has successfully completed its private placement offering
("PPO") of preferred stock and subordinated notes. Severn has also been
approved to participate in the U.S. Treasury Capital Purchase Program ("CPP").
Effective as of November 15, 2008, Severn accepted subscriptions under its PPO
in the amount of $7.0 million in gross capital proceeds and will issue 437,500
shares of Preferred Stock and $3,500,000 aggregate principal amount of
Subordinated Notes. On November 14, 2008, Severn received notice from the U.S.
Treasury that its application for the CPP had been approved in the amount of
approximately $23.5 million. Closing on the CPP is expected to occur on
November 21, 2008. The combined total of new capital to Severn will be
approximately $30.5 million before adjustment for related expenses.
Chairman of the Board and CEO of Severn, Alan Hyatt, said, "We are very
pleased to successfully close our PPO and be selected by the U.S. Treasury,
upon the recommendation of Severn's primary regulator, the Office of Thrift
Supervision, Atlanta District Office, to be granted the opportunity to
participate in the CPP. This will increase our regulatory capital from
approximately $100 million to $130 million. While we are already a well
capitalized institution, this infusion of low-cost capital under the CPP will
further strengthen our ability to continue our long-standing tradition of
lending in our community."
About Severn
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 nearly $1 billion 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, statements about the expected closing on the securities offerings. 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. The Company'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 Company's general market area, federal
and state regulation, competition and other factors detailed from time to time
in the Company's filings with the Securities and Exchange Commission (the
"SEC"), including "Item 1A. Risk Factors" contained in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2007 and Quarterly
Report on Form 10-Q for the quarter ended June 30, 2008.
SOURCE Severn Bancorp, Inc