SEVERN BANCORP 
By ANNAPOLIS, Md., Oct. 15 /PRNewswire-FirstCall/ -- Severn Bancorp, Inc., (Nasdaq: SVBI) parent company of Severn Savings Bank, FSB ("Severn"), today announced results for the quarter and nine months ended September 30, 2010. Net income for the third quarter was $485,000 (unaudited), or $.01 per share, compared to net loss of $4.4 million (unaudited), or ($.48) per share for the third quarter of 2009. Net income was $550,000, or ($.07) per share for the nine months ended September 30, 2010, compared to net loss of $12.6 million, or ($1.38) per share for the nine months ended September 30, 2009. At September 30, 2010, Severn's regulatory capital ratios continued to exceed the levels required to be considered "well capitalized" under applicable federal banking regulations, including its core (leverage) ratio of approximately 12.1% compared to the regulatory requirement of 5% for "well capitalized" status.
"While we are pleased to report a modest profit for the third quarter compared to last year's third quarter loss, it is clear that economic conditions remain challenging," said Alan J. Hyatt, president and chief executive officer. "Despite the disruptions in our industry and the overall economy we are continuing our strategy to provide full service banking to our customers." Mr. Hyatt continued "We are confident that we are the best choice for Anne Arundel County residents who are seeking a financial institution that provides sound banking products and excellent customer service, as well as a commitment to reinvest 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 approximately $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, 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. 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, 2009.
Severn Bancorp, Inc.
Selected Financial Data
(dollars in thousands, except per share data)
(Unaudited)
For the Three Months Ended
September 30, June 30, March 31,
2010 2010 2010
---- ---- ----
Summary Operating
Results:
Interest income $12,083 $13,045 $12,596
Interest expense 4,906 4,995 4,980
----- ----- -----
Net interest income 7,177 8,050 7,616
Provision for loan
losses 1,000 1,000 2,544
----- ----- -----
Net interest income
(loss) after provision
for loan losses 6,177 7,050 5,072
Non-interest income 724 537 563
Non-interest expense 6,031 6,533 6,464
----- ----- -----
Income (loss) before
income taxes 870 1,054 (829)
Income tax expense
(benefit) 385 461 (301)
--- --- ----
Net income (loss) $485 $593 $(528)
---- ---- -----
Per Share Data:
Basic earnings (loss)
per share $0.01 $0.02 $(0.10)
Diluted earnings (loss)
per share $0.01 $0.02 $(0.10)
Common stock dividends
per share $- $- $-
Average basic shares
outstanding 10,066,679 10,066,679 10,066,679
Average diluted shares
outstanding 10,066,679 10,076,763 10,066,679
Performance Ratios:
Return on average
assets 0.05% 0.06% -0.05%
Return on average
equity 0.47% 0.60% -0.50%
Net interest margin 3.17% 3.63% 3.49%
Efficiency ratio* 62.85% 56.97% 59.20%
For the Three Months Ended
December 31, September 30,
2009 2009
---- ----
Summary Operating
Results:
Interest income $12,822 $13,347
Interest expense 5,667 6,296
----- -----
Net interest income 7,155 7,051
Provision for loan
losses 5,458 8,909
----- -----
Net interest income
(loss) after provision
for loan losses 1,697 (1,858)
Non-interest income 586 570
Non-interest expense 6,628 5,980
----- -----
Income (loss) before
income taxes (4,345) (7,268)
Income tax expense
(benefit) (1,694) (2,909)
------ ------
Net income (loss) $(2,651) $(4,359)
------- -------
Per Share Data:
Basic earnings (loss)
per share $(0.31) $(0.48)
Diluted earnings (loss)
per share $(0.31) $(0.48)
Common stock dividends
per share $- $0.03
Average basic shares
outstanding 10,066,679 10,066,679
Average diluted shares
outstanding 10,066,679 10,066,679
Performance Ratios:
Return on average
assets -0.27% -0.44%
Return on average
equity -2.46% -3.90%
Net interest margin 3.17% 3.06%
Efficiency ratio* 61.36% 60.90%
* The efficiency ratio is general and administrative expenses as a
percentage of net interest income plus non-interest income
As of
September 30, June 30, March 31,
2010 2010 2010
---- ---- ----
Balance Sheet Data:
Total assets $975,894 $1,002,284 $970,791
Total loans receivable 816,726 840,049 842,529
Allowance for loan
losses (30,335) (34,040) (34,560)
------- ------- -------
Net loans 786,391 806,009 807,969
Deposits 717,319 742,042 712,376
Stockholders' equity 105,813 105,647 105,374
Bank's Tier 1 core
capital to total
assets 12.1% 11.6% 11.9%
Book value per share $7.86 $7.85 $7.82
Asset Quality Data:
Non-accrual loans $53,563 $47,857 $50,556
Foreclosed real estate 18,783 16,272 23,586
------ ------ ------
Total non-performing
assets 72,346 64,129 74,142
Total non-accrual
loans to net loans 6.8% 5.9% 6.3%
Allowance for loan
losses 30,335 34,040 34,560
Allowance for loan
losses to total loans 3.7% 4.1% 4.1%
Allowance for loan
losses to total non-
performing loans 56.6% 71.1% 68.4%
Total non-accrual
loans to total assets 5.5% 4.8% 5.2%
Total non-performing
assets to total assets 7.4% 6.4% 7.6%
As of
December 31, September 30,
2009 2009
---- ----
Balance Sheet Data:
Total assets $967,936 $995,904
Total loans receivable 848,927 869,765
Allowance for loan
losses (34,693) (34,009)
------- -------
Net loans 814,234 835,756
Deposits 710,330 725,040
Stockholders' equity 106,231 109,212
Bank's Tier 1 core
capital to total
assets 11.8% 12.2%
Book value per share $7.91 $8.21
Asset Quality Data:
Non-accrual loans $62,685 $68,801
Foreclosed real estate 21,574 17,877
------ ------
Total non-performing
assets 84,259 86,678
Total non-accrual
loans to net loans 7.7% 8.2%
Allowance for loan
losses 34,693 34,009
Allowance for loan
losses to total loans 4.1% 3.9%
Allowance for loan
losses to total non-
performing loans 55.3% 49.4%
Total non-accrual
loans to total assets 6.5% 6.9%
Total non-performing
assets to total assets 8.7% 8.7%
SOURCE Severn Bancorp, Inc.
