By ANNAPOLIS, Md., Jan. 24, 2014 /PRNewswire/ -- Severn Bancorp, Inc., (Nasdaq: SVBI) ("Company") parent company of Severn Savings Bank, FSB ("Severn"), today announced that non-performing assets, comprised of other real estate owned and non-accrual loans, have been reduced to $20,007,000, or 2.5% of total assets, as of December 31, 2013 compared to $48,936,000, or 5.7% of total assets, as of December 31, 2012.
"Our organization has been focused on cleaning up our balance sheet with the goal being to start 2014 with a clean and strong financial position," said Alan J. Hyatt, president and chief executive officer. Mr. Hyatt continued, "Severn sold over $48 million in underperforming loans and $9 million in real estate acquired through foreclosure in 2013, with several million dollars' worth of real estate pending sale as of 2013 year end."
As a result of these transactions and conservatively calculating reserves and charge offs, the Company incurred a net loss of $5,470,000 or $(.58) per share for the fourth quarter of 2013, compared to net income of $1,274,000 or $.09 per share for the fourth quarter of 2012. Net loss was $25,165,000, or $(2.64) per share for the year ended December 31, 2013, compared to net income of $3,728,000, or $.22 per share for the year ended December 31, 2012. Earnings per share is calculated using net income available for common shareholders, which is net income less preferred stock dividends.
"We are fortunate that our organization has been well capitalized making it able to withstand the balance sheet cleanup and the resulting losses," said Mr. Hyatt. Mr. Hyatt continued, "Severn now looks forward to progress and growth as its balance sheet and the overall economic conditions have continued to improve. Severn remains one of the area's few community banks and continues to offer exceptional service that some businesses and individuals prefer over the larger out-of-town based banks."
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 approximately $800 million 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. 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, 2012.
Severn Bancorp, Inc.
Selected Financial Data
(dollars in thousands, except per share data)
(Unaudited)
For the Three Months Ended
December 31, September 30, June 30, March 31, December 31,
2013 2013 2013 2013 2012
---- ---- ---- ---- ----
Summary Operating Results:
Interest income $7,984 $8,321 $8,574 $8,913 $9,412
Interest expense 2,204 2,301 2,364 2,315 2,587
----- ----- ----- ----- -----
Net interest income 5,780 6,020 6,210 6,598 6,825
Provision for loan losses 3,700 12,200 300 320 300
----- ------ --- --- ---
Net interest income (loss) after provision
for loan losses 2,080 (6,180) 5,910 6,278 6,525
Non-interest income 1,196 1,312 1,881 1,572 1,478
Non-interest expense 8,745 7,504 7,470 6,785 5,815
----- ----- ----- ----- -----
Income (loss) before income tax
provision (5,469) (12,372) 321 1,065 2,188
Income tax provision 1 8,176 89 444 914
--- ----- --- --- ---
Net income (loss) $(5,470) $(20,548) $232 $621 $1,274
------- -------- ---- ---- ------
Per Share Data:
Basic earnings (loss) per share $(0.58) $(2.08) $(0.01) $0.03 $0.09
Diluted earnings (loss) per
share $(0.58) $(2.08) $(0.01) $0.03 $0.09
Common stock dividends per
share $ - $ - $ - $ - $ -
Average basic shares
outstanding 10,066,679 10,066,679 10,066,679 10,066,679 10,066,679
Average diluted shares
outstanding 10,066,679 10,066,679 10,108,470 10,100,454 10,066,679
Performance Ratios:
Return on average assets -0.66% -2.45% 0.03% 0.07% 0.14%
Return on average equity -6.31% -19.07% 0.21% 0.57% 1.19%
Net interest margin 3.15% 3.21% 3.29% 3.47% 3.33%
Efficiency ratio* 88.43% 83.70% 76.42% 72.01% 63.70%
* The efficiency ratio is general and administrative expenses as a percentage of net interest income plus non-
interest income
As of
December 31, September 30, June 30, March 31, December 31,
2013 2013 2013 2013 2012
---- ---- ---- ---- ----
Balance Sheet Data:
Total assets $799,603 $815,198 $839,053 $849,598 $852,118
Total loans receivable 614,552 608,769 642,801 653,595 669,187
Allowance for loan losses (11,739) (12,270) (12,765) (15,465) (17,478)
------- ------- ------- ------- -------
Net loans 602,813 596,499 630,036 638,130 651,709
Deposits 571,249 580,915 583,271 593,900 599,394
Borrowings 115,000 115,000 115,000 115,000 115,000
Stockholders' equity 82,769 88,496 109,313 109,349 108,996
Bank's Tier 1 core capital to
total assets 12.9% 13.3% 14.9% 14.8% 14.6%
Book value per share $5.57 $6.14 $8.21 $8.22 $8.18
Asset Quality Data:
Non-accrual loans $11,035 $22,771 $37,537 $35,064 $37,495
Foreclosed real estate 8,972 13,877 13,297 14,895 11,441
----- ------ ------ ------ ------
Total non-performing assets 20,007 36,648 50,834 49,959 48,936
Total non-accrual loans to net
loans 1.8% 3.8% 6.0% 5.5% 5.8%
Total non-accrual loans to
total assets 1.4% 2.8% 4.5% 4.1% 4.4%
Allowance for loan losses 11,739 12,270 12,765 15,465 17,478
Allowance for loan losses to
total loans 1.9% 2.0% 2.0% 2.4% 2.6%
Allowance for loan losses to total
non-accrual loans 106.4% 53.9% 34.0% 44.1% 46.6%
Total non-performing assets to
total assets 2.5% 4.5% 6.1% 5.9% 5.7%
Non-accrual troubled debt
restructurings (included
above) 2,091 4,750 5,908 6,774 5,635
Performing troubled debt
restructurings 34,564 39,548 45,851 46,607 56,448
SOURCE Severn Bancorp, Inc.
