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Severn Bancorp Announces First Quarter Earnings

               Severn Bancorp Announces First Quarter Earnings

PR Newswire

ANNAPOLIS, Md., April 16, 2013

ANNAPOLIS, Md., April 16, 2013 /PRNewswire/ --Severn Bancorp, Inc., (Nasdaq:
SVBI) parent company of Severn Savings Bank, FSB ("Severn"), today announced
net income of $621,000 or $.03 per share for the first quarter of 2013, a
slight increase of $44,000, or 7.6% compared to net income of $577,000, or
$.02 per share for the first quarter of 2012. Earnings per share is
calculated using net income available for common shareholders, which is net
income less preferred stock dividends.

"The profit posted in the first quarter was a modest one," stated Alan J.
Hyatt, president and chief executive officer. Mr. Hyatt continued, "Severn
continues to work through real estate loans that became troubled. It is a
slow process. We are confident that the bank is on the right path to improved
future earnings, but the effort will continue to take time. Severn is up to
the challenge and intends to provide outstanding community banking services in
a market with a diminishing number of community 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 $850 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
                    March 31,   December    September   June 30,    March 31,
                                31,         30,
                    2013        2012        2012        2012        2012
Summary Operating
Results:
 Interest income    $      $      $      $      $    
                     8,913     9,412     9,104     10,276      10,265
 Interest expense   2,315       2,587       3,027       3,336       3,552
    Net interest    6,598       6,825       6,077       6,940       6,713
    income
 Provision for loan 320         300         -           -           465
 losses
    Net interest
    income after
    provision
         for loan   6,278       6,525       6,077       6,940       6,248
         losses
 Non-interest       1,572       1,478       1,039       835         891
 income
 Non-interest       6,785       5,815       5,961       5,732       6,139
 expense
 Income before
 income tax         1,065       2,188       1,155       2,043       1,000
 provision
 Income tax         444         914         481         840         423
 provision
                    $      $      $      $      $    
    Net income         621    1,274       674    1,203       
                                                                    577
Per Share Data:
 Basic earnings per $      $      $      $      $    
 share                0.03     0.09     0.03     0.08     
                                                                    0.02
 Diluted earnings   $      $      $      $      $    
 per share            0.03     0.09     0.03     0.08     
                                                                    0.02
 Common stock       $      $      $      $      $    
 dividends per           -      -      -      -     
 share                                                               -
 Average basic      10,066,679  10,066,679  10,066,679  10,066,679  10,066,679
 shares outstanding
 Average diluted    10,100,454  10,066,679  10,066,679  10,066,679  10,066,679
 shares outstanding
Performance Ratios:
 Return on average  0.07%       0.14%       0.08%       0.13%       0.06%
 assets
 Return on average  0.57%       1.19%       0.63%       1.13%       0.54%
 equity
 Net interest       3.47%       3.33%       3.09%       3.41%       3.27%
 margin
 Efficiency ratio*  72.01%      63.70%      71.19%      64.96%      64.73%
    *    The efficiency ratio is general and administrative expenses as a
         percentage of net interest income plus non-interest income
                    As of
                    March 31,   December    September   June 30,    March 31,
                                31,         30,
                    2013        2012        2012        2012        2012
Balance Sheet Data:
 Total assets       $      $      $      $      $    
                    849,598     852,118     862,628     897,390      901,111
 Total loans        653,595     669,187     688,405     687,796     701,596
 receivable
 Allowance for loan (15,465)    (17,478)    (23,180)    (24,097)    (25,795)
 losses
    Net loans       638,130     651,709     665,225     663,699     675,801
 Deposits           593,900     599,394     609,772     643,653     650,473
 Borrowings         115,000     115,000     115,000     115,000     115,000
 Stockholders'      109,349     108,996     108,004     107,612     106,691
 equity
 Bank's Tier 1 core
 capital to total   14.8%       14.6%       14.1%       13.4%       13.2%
 assets
 Book value per     $      $      $      $      $    
 share                8.22     8.18     8.08     8.04     
                                                                    7.95
Asset Quality Data:
 Non-accrual loans  $      $      $      $      $    
                     35,064     37,495     42,596     38,965      29,559
 Foreclosed real    14,895      11,441      13,801      16,329      19,853
 estate
    Total
    non-performing  49,959      48,936      56,397      55,294      49,412
    assets
 Total non-accrual  5.5%        5.8%        6.4%        5.9%        4.4%
 loans to net loans
 Total non-accrual
 loans to total     4.1%        4.4%        4.9%        4.3%        3.3%
 assets
 Allowance for loan 15,465      17,478      23,180      24,097      25,795
 losses
 Allowance for loan
 losses to total    2.4%        2.6%        3.4%        3.5%        3.7%
 loans
 Allowance for loan
 losses to total
    non-accrual     44.1%       46.6%       54.4%       61.8%       87.3%
    loans
 Total
 non-performing     5.9%        5.7%        6.5%        6.2%        5.5%
 assets to total
 assets
 Non-accrual
 troubled debt      6,774       5,635       12,574      9,515       11,677
 restructurings
 (included above)
 Performing
 troubled debt      46,607      56,448      51,230      51,034      51,219
 restructurings

SOURCE Severn Bancorp, Inc.

Website: http://www.severnbank.com
Contact: Thomas G. Bevivino, Chief Operating Officer &, Executive Vice
President, tbevivino@severnbank.com, 410.260.2000
 
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