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Severn Bancorp, Inc. Announces Additional Sale of Loans

           Severn Bancorp, Inc. Announces Additional Sale of Loans

PR Newswire

ANNAPOLIS, Md., Jan. 3, 2014

ANNAPOLIS, Md., Jan. 3, 2014 /PRNewswire/ -- Severn Bancorp, Inc., (Nasdaq:
SVBI) parent company of Severn Savings Bank, FSB (" the Bank"), announced
today that the Bank recently completed the sale of underperforming loans with
a book value of approximately $15 million for a sale price of approximately
$11 million. As a result of the sale, the Bank will experience a pre-tax
charge to income for the 4^th quarter of approximately $4 million.

The sale consisted of approximately $12 million of non-performing loans, the
bulk of which were residential loans. This was a follow up to the previous
quarter sale of loans with an approximate book value of $33 million. In
addition to the loan sales, management has aggressively written down and sold
certain foreclosed properties. As a result, the balance of foreclosed
property is expected to be below $10 million at December 31, 2013.

"Both sales represent material reductions in our non-performing loans,
significantly reducing the resources that have been necessary to manage
non-performing loans," stated Alan J. Hyatt, president and chief executive
officer. Mr. Hyatt continued, "Furthermore, the sales enhance our efforts to
focus on improving earnings and increasing profitability. We have worked very
hard the past few years managing problem loans since the economy faltered. It
was time for a quicker resolution to the issues that were impeding progress
for the Bank. Management and the Board made the decision to do what needed to
be done to clean up the Bank's balance sheet and position the company for
growth in 2014 and beyond." 

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 $820 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.

SOURCE Severn Bancorp, Inc.

Contact: Thomas G. Bevivino, Executive Vice President & CFO/COO, Email:
tbevivino@severnbank.com, Phone: 410.260.2000