ANNAPOLIS, Md., April 23, 2018 /PRNewswire/ -- Severn
Bancorp, Inc., (Nasdaq: SVBI) parent company of Severn Savings
Bank, FSB, today announced an increase in net income of over 100%
for the first quarter of 2018 versus the first quarter of 2017. Net
income was $1.9 million versus
$925 thousand for the quarters ended
March 31, 2018 and 2017,
respectively. On a diluted per share basis, earnings were
$0.15 versus $0.06 for the quarters ended March 31, 2018 and 2017, respectively.
Net interest income increased 19% during the first quarter of
2018. Net interest income was $7.0
million during the first quarter of 2018 versus $5.9 million during the first quarter of 2017.
The increase is due to higher interest income resulting from loan
growth and lower interest expense on borrowings. Interest expense
on borrowing has decreased due to maturing FHLB advances being
refinanced at lower rates.
Non-interest income increased to $1.9
million in the first quarter of 2018 versus $1.4 million in the first quarter of 2017.
The increase was due to higher volume of fees on a growing
deposit portfolio and higher sales of mortgages into the secondary
market. Non-interest expenses increased modestly to $6.2 million in the first quarter of 2018 versus
$5.7 million in the first quarter of
2017. The increase is due to added staffing which was needed to
support the growth in our lending and deposit programs.
"We are pleased to report earnings for the quarter that show
substantial progress year over year," stated Alan
J. Hyatt, President and Chief Executive Officer. Mr.
Hyatt continued, "The Company has seen notable improvement in asset
quality, and recently also announced payment of a dividend to
shareholders. We continue to execute our strategy of generating
core deposits and growing our commercial and mortgage lending
units. While our results for the quarter are trending in the
right direction, we remain focused on continued improvement in our
operations and enhancing long term shareholder value."
About Severn Savings Bank: 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 $801 million and five
branches located in Annapolis,
Edgewater, Severna Park 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. Severn'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 in Severn's general market area, federal and
state regulation, competition and other factors detailed from time
to time in Severn's filings with
the Securities and Exchange Commission (the "SEC"), including "Item
1A. Risk Factors" contained in Severn's Annual Report on Form 10-K for the
fiscal year ended December 31,
2017.
Severn Bancorp,
Inc.
|
Consolidated
Income Statement
|
(dollars in
thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
Year-to-Date
income statement results:
|
Year Ended March
31,
|
|
|
|
|
|
2018
|
2017
|
$
Change
|
%
Change
|
|
|
|
|
|
|
|
Interest
Income
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
loans
|
|
$
8,371
|
$
7,131
|
$
1,240
|
17.38%
|
|
Interest on
securities
|
|
320
|
269
|
51
|
18.99%
|
|
Other interest
income
|
|
186
|
157
|
29
|
18.45%
|
|
|
|
|
|
|
|
|
Total interest
income
|
|
8,877
|
7,557
|
1,320
|
17.46%
|
|
|
|
|
|
|
|
Interest
Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
|
1,133
|
975
|
158
|
16.18%
|
|
Interest on long term
borrowings
|
|
760
|
996
|
(236)
|
-23.67%
|
|
|
|
|
|
|
|
|
Total interest
expense
|
|
1,893
|
1,971
|
(78)
|
-3.96%
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
6,984
|
5,586
|
1,398
|
25.02%
|
|
|
|
|
|
|
|
|
Provision for
(reversal of) loan losses
|
|
0
|
(275)
|
275
|
-100.00%
|
|
|
|
|
|
|
|
|
Net interest income
after provision for (reversal of) loan losses
|
|
6,984
|
5,861
|
1,123
|
19.15%
|
|
|
|
|
|
|
|
Non-interest
income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage-banking
revenue
|
|
595
|
535
|
60
|
11.20%
|
|
Real Estate
Commissions
|
|
385
|
380
|
5
|
1.40%
|
|
Real Estate
Management Income
|
|
183
|
194
|
(11)
|
-5.53%
|
|
All other
income
|
|
706
|
249
|
457
|
183.58%
|
|
|
|
|
|
|
|
|
Net non-interest
income
|
|
1,870
|
1,358
|
512
|
37.68%
|
|
|
|
|
|
|
|
|
Net interest income
after provision for (reversal of) loan losses plus
non-interest income
|
|
8,853
|
7,219
|
1,634
|
22.64%
|
|
|
|
|
|
|
|
Non-Interest
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and
related expenses
|
|
4,278
|
3,757
|
521
|
13.86%
|
|
Net Occupancy &
Depreciation
|
|
344
|
336
|
8
|
2.44%
|
|
Net Costs of
Foreclosed Real Estate
|
|
32
|
33
|
(1)
|
-2.81%
|
|
Other
|
|
1,569
|
1,549
|
20
|
1.27%
|
|
|
|
|
|
|
|
|
Total non-interest
expenses
|
|
6,223
|
5,675
|
548
|
9.65%
|
|
|
|
|
|
|
|
|
Income before income
tax provision
|
|
2,631
|
1,544
|
1,087
|
70.37%
|
|
|
|
|
|
|
|
|
Income tax
provision
|
|
745
|
619
|
126
|
20.43%
|
|
|
|
|
|
|
|
|
Net income
|
|
$
1,885
|
$
925
|
$
960
|
103.80%
|
|
Net income available
to common shareholders
|
|
$
1,815
|
$
855
|
$
960
|
112.28%
|
Severn Bancorp,
Inc.
|
Consolidated
Balance Sheet
|
(dollars in
thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
2018
|
December 31,
2017
|
$
Change
|
%
Change
|
Balance Sheet
Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
Cash
|
|
|
$
2,291
|
$
2,382
|
$
(90)
|
-3.79%
|
|
Federal funds and
Interest bearing deposits in other banks
|
|
|
16,016
|
19,471
|
(3,455)
|
-17.74%
|
|
Certificates of
deposit held for investment
|
|
|
8,780
|
8,780
|
0
|
0.00%
|
|
Investment securities
available for sale
|
|
|
12,011
|
10,119
|
1,892
|
18.70%
|
|
Investment securities
held to maturity
|
|
|
49,911
|
54,303
|
(4,392)
|
-8.09%
|
|
Loans held for
sale
|
|
|
5,803
|
4,530
|
1,272
|
28.08%
|
|
Loans
receivable
|
|
|
669,912
|
668,151
|
1,760
|
0.26%
|
|
Loan valuation
allowance
|
|
|
(8,169)
|
(8,055)
|
(114)
|
1.41%
|
|
Accrued interest
receivable
|
|
2,454
|
2,640
|
(186)
|
-7.03%
|
|
Foreclosed real
estate, net
|
|
237
|
403
|
(166)
|
-41.19%
|
|
Premises and
equipment, net
|
|
23,121
|
23,139
|
(18)
|
-0.08%
|
|
Restricted stock
investments
|
|
4,844
|
4,489
|
355
|
7.91%
|
|
Bank owned life
insurance
|
|
5,104
|
5,064
|
41
|
0.81%
|
|
Deferred income
taxes
|
|
4,565
|
5,302
|
(737)
|
-13.90%
|
|
Prepaid expenses and
other assets
|
|
4,205
|
4,070
|
135
|
3.31%
|
|
|
|
|
|
|
|
|
|
|
|
|
$
801,085
|
$
804,788
|
$
(3,703)
|
-0.46%
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS EQUITY
|
|
|
|
|
|
|
|
Deposits
|
|
|
$
589,916
|
$
602,228
|
$ (12,312)
|
-2.04%
|
|
Borrowings
|
|
|
96,500
|
88,500
|
8,000
|
9.04%
|
|
Subordinated
debentures
|
|
|
20,619
|
20,619
|
-
|
0.00%
|
|
Accounts payable and
accrued expenses
|
|
|
1,632
|
2,340
|
(709)
|
-30.27%
|
|
|
|
|
|
|
|
|
|
Total
Liabilities
|
|
|
708,667
|
713,688
|
(5,021)
|
-3.79%
|
|
|
|
|
|
|
|
|
|
Preferred
stock
|
|
|
4
|
4
|
-
|
-3.79%
|
|
Common
stock
|
|
|
122
|
122
|
(0)
|
-3.79%
|
|
Additional paid-in
capital
|
|
|
65,060
|
65,137
|
(77)
|
-3.79%
|
|
Retained
earnings
|
|
|
27,320
|
25,873
|
1,448
|
-3.79%
|
|
Accumulated
comprehensive income (loss)
|
|
|
(89)
|
(36)
|
(52)
|
-3.79%
|
|
|
|
|
|
|
|
|
|
Total
Stockholders' Equity
|
|
92,419
|
91,100
|
1,319
|
1.45%
|
|
|
|
|
|
|
|
|
|
|
|
|
$
801,085
|
$
804,788
|
$
(3,702)
|
-0.46%
|
Severn Bancorp,
Inc.
|
Selected Financial
Data
|
(dollars in
thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
|
|
|
2018
|
2017
|
Per Share
Data:
|
|
|
|
|
Basic earnings per
share
|
|
$
0.15
|
$
0.07
|
|
Diluted earnings per
share
|
|
$
0.15
|
$
0.07
|
|
Average basic shares
outstanding
|
|
12,241,554
|
12,125,553
|
|
Average diluted
shares outstanding
|
|
12,334,637
|
12,210,580
|
|
|
|
|
|
|
Performance
Ratios:
|
|
|
|
|
Return on average
assets
|
|
|
0.94%
|
0.48%
|
|
Return on average
equity
|
|
8.22%
|
4.24%
|
|
Net interest
margin
|
|
3.66%
|
3.09%
|
|
Efficiency
ratio*
|
|
69.92%
|
81.25%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
2018
|
December 31,
2017
|
Asset Quality
Data:
|
|
|
|
|
Non-accrual
loans
|
|
$
5,702
|
$
5,710
|
|
Foreclosed real
estate
|
|
237
|
403
|
|
Total non-performing
assets
|
|
5,939
|
6,113
|
|
Total non-accrual
loans to total loans
|
|
0.9%
|
0.9%
|
|
Total non-accrual
loans to total assets
|
|
0.7%
|
0.7%
|
|
Allowance for loan
losses
|
|
8,169
|
8,055
|
|
Allowance for loan
losses to total loans
|
|
1.2%
|
1.2%
|
|
|
|
|
|
|
Allowance for loan
losses to total non-accrual
loans
|
|
143.3%
|
141.1%
|
|
Total non-performing
assets to total assets
|
|
0.7%
|
0.8%
|
|
Non-accrual troubled
debt restructurings (included above)
|
|
811
|
819
|
|
Performing troubled
debt restructurings
|
|
12,758
|
13,713
|
|
Loan to deposit
ratio
|
|
113.6%
|
110.9%
|
|
|
|
|
|
* This non-GAAP financial
measure is calculated as non-interest expenses less OREO expenses
divided by net interest income plus non-interest
income.
|
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SOURCE Severn Bancorp, Inc.