Severn Bancorp, Inc. Announces First Quarter Earnings

            Severn Bancorp, Inc. Announces First Quarter Earnings  PR Newswire  ANNAPOLIS, Md., April 16, 2014  ANNAPOLIS, Md., April 16, 2014 /PRNewswire/ -- Severn Bancorp, Inc., (Nasdaq: SVBI) parent company of Severn Savings Bank, FSB ("Severn"), today announced net income of $867,000 or $.03 per share for the first quarter of 2014, an increase of approximately 40% compared to net income of $621,000 or $.03 per share for first quarter of 2013. Results reported also represent a significant increase in earnings compared to a net loss of $5,470,000 or $(.58) per share for the fourth quarter of 2013. Earnings per share is calculated using net income available for common shareholders, which is net income less preferred stock dividends.  "We are encouraged to be able to report a profit for this first quarter after successfully concluding almost $50 million of problem asset sales in late 2013," stated Alan J. Hyatt, president and chief executive officer. Mr. Hyatt continued, "Severn made decisions to position the bank for success as one of the few remaining local community banks, and this is a first step in the right direction. We are now dedicated to expanding technology and service offerings rather than dealing with problems. Severn is proud to continue the tradition of offering the personal service that residents and business owners in Anne Arundel County have come to expect from a community bank."  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 $790 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, 2013.  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,                     2014        2013        2013        2013        2013 Summary Operating Results:  Interest income    $      $      $      $      $                          7,922     7,984     8,321     8,574      8,913  Interest expense   2,115       2,204       2,301       2,364       2,315    Net interest     5,807       5,780       6,020       6,210       6,598    income  Provision for loan 200         3,700       12,200      300         320  losses    Net interest    income (loss)    after provision          for loan   5,607       2,080       (6,180)     5,910       6,278          losses  Non-interest       976         1,032       1,227       1,742       1,528  income  Non-interest       5,706       8,581       7,419       7,331       6,741  expense  Income (loss)  before income tax  877         (5,469)     (12,372)    321         1,065  provision  Income tax         10          1           8,176       89          444  provision    Net income       $      $      $      $      $        (loss)              867    (5,470)   (20,548)       232                                                                           621 Per Share Data:  Basic earnings     $      $      $      $      $      (loss) per share      0.03    (0.58)   (2.08)   (0.01)                                                                         0.03  Diluted earnings   $      $      $      $      $      (loss) per share      0.03    (0.58)   (2.08)   (0.01)                                                                         0.03  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    10,103,153  10,066,679  10,066,679  10,108,470  10,100,454  shares outstanding Performance Ratios:  Return on average  0.11%       -0.66%      -2.45%      0.03%       0.07%  assets  Return on average  1.06%       -6.31%      -19.07%     0.21%       0.57%  equity  Net interest       3.23%       3.15%       3.21%       3.29%       3.47%  margin  Efficiency ratio*  84.90%      88.15%      83.51%      76.01%      71.86%    *     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,                     2014        2013        2013        2013        2013 Balance Sheet Data:  Total assets       $      $      $      $      $                         793,433     799,603     815,198     839,053      849,598  Total loans        614,986     614,552     608,769     642,801     653,595  receivable  Allowance for loan (11,225)    (11,739)    (12,270)    (12,765)    (15,465)  losses    Net loans        603,761     602,813     596,499     630,036     638,130  Deposits           562,964     571,249     580,915     583,271     593,900  Borrowings         115,000     115,000     115,000     115,000     115,000  Stockholders'      83,202      82,769      88,496      109,313     109,349  equity  Bank's Tier 1 core  capital to total   13.2%       12.9%       13.3%       14.9%       14.8%  assets  Book value per     $      $      $      $      $      share                5.62     5.57     6.14     8.21                                                                          8.22 Asset Quality Data:  Non-accrual loans  $      $      $      $      $                          12,567     11,035     22,771     37,537      35,064  Foreclosed real    5,561       8,972       13,877      13,297      14,895  estate    Total    non-performing   18,128      20,007      36,648      50,834      49,959    assets  Total non-accrual  2.1%        1.8%        3.8%        6.0%        5.5%  loans to net loans  Total non-accrual  loans to total     1.6%        1.4%        2.8%        4.5%        4.1%  assets  Allowance for loan 11,225      11,739      12,270      12,765      15,465  losses  Allowance for loan  losses to total    1.8%        1.9%        2.0%        2.0%        2.4%  loans  Allowance for loan  losses to total    non-accrual      89.3%       106.4%      53.9%       34.0%       44.1%    loans  Total  non-performing     2.3%        2.5%        4.5%        6.1%        5.9%  assets to total  assets  Non-accrual  troubled debt      2,390       2,091       4,750       5,908       6,774  restructurings  (included above)  Performing  troubled debt      33,149      34,827      39,548      45,851      46,607  restructurings    SOURCE Severn Bancorp, Inc.  Contact: Thomas G. Bevivino, Executive Vice President & CFO/COO, Email: tbevivino@severnbank.com, Phone: 410.260.2000