Metro Bancorp Reports Net Income of $4.9 Million; EPS up 31% and Loans Grow 15%

  Metro Bancorp Reports Net Income of $4.9 Million; EPS up 31% and Loans Grow
  15%

Business Wire

HARRISBURG -- April 24, 2014

Metro Bancorp, Inc. (Metro or the Company) (NASDAQ Global Select Market
Symbol: METR), parent company of Metro Bank, today reported net income of $4.9
million, or $0.34 per diluted common share, for the quarter ended March31,
2014, compared to net income of $3.6 million, or $0.26 per diluted common
share, for the first quarter of 2013. The Company also reported net loan
growth of $231.4 million, or 15%, over the past twelve months.


Financial Highlights
(in millions, except per share data)
                                                              
                                      Quarter Ended
                                                                  %
                                    03/31/14     03/31/13     Increase
Total assets                          $ 2,850.0     $ 2,614.6     9    %
                                                                       
Total loans (net)                     1,778.3       1,546.9       15   %
                                                                       
Total deposits                        2,195.3       2,196.8       —    %
                                                              
                                                                       
Total revenues                        $ 30.4        $ 29.7        2    %
                                                                       
Net income                            4.9           3.6           36   %
                                                                       
Diluted net income per common share   $ 0.34        $ 0.26        31   %
                                                            
                                                                       

“Our strong balance sheet, led by our 15% growth in net loans, and our
continued momentum and focus helped us to record our highest quarterly net
income in the Company's 29 year history,” said Gary L. Nalbandian, the
Company's Chairman and Chief Executive Officer. "Our net interest margin and
asset quality were both stable for the quarter and our expense management
remains diligent and controlled."

Income Statement Highlights

  *The Company recorded net income of $4.9 million, or $0.34 per diluted
    common share, for the first quarter of 2014 compared to net income of $3.6
    million, or $0.26 per diluted common share, for the same period one year
    ago, a $1.3 million, or 36%, increase.
  *Return on average stockholders' equity was 8.42% for the first quarter of
    2014, compared to 8.30% for the previous quarter and compared to 6.28% for
    the same period last year.

  *Total revenues (net interest income plus noninterest income) for the first
    quarter of 2014 were $30.4 million, up $703,000, or 2%, over total
    revenues of $29.7 million for the same quarter one year ago.
  *The Company's net interest margin on a fully-taxable basis for the first
    quarter of 2014 was 3.56%, compared to 3.55% recorded in the fourth
    quarter of 2013 and compared to 3.67% for the first quarter of 2013. The
    Company's deposit cost of funds for the first quarter was 0.27%, compared
    to 0.28% for the previous quarter and compared to 0.31% for the same
    period one year ago.
  *The provision for loan losses totaled $900,000 for the first quarter of
    2014, compared to $1.6 million for the previous quarter and compared to
    $2.3 million for the first quarter one year ago. Our allowance for loan
    losses totaled $23.9 million, or 1.33%, of total loans at March31, 2014,
    up $824,000, or 4%, over the previous quarter and compared to $27.5
    million, or 1.74%, of total loans at March31, 2013.
  *Noninterest expenses for the first quarter 2014 were $22.8 million, up
    $45,000, compared to the previous quarter and up $453,000, or 2%, over the
    same quarter last year.

Balance Sheet Highlights

  *Net loans grew $50.5 million, or 3%, on a linked quarter basis to $1.78
    billion and were up $231.4 million, or 15%, over the first quarter 2013.
  *Total deposits were $2.20 billion, basically flat compared to the same
    quarter last year.
  *Nonperforming assets were 1.57% of total assets at March31, 2014,
    compared to 1.61% of total assets for the previous quarter and compared to
    1.67% of total assets one year ago.
  *Metro's capital levels remain strong with a Tier 1 Leverage ratio of 9.48%
    and a total risk-based capital ratio of 14.59%.
  *Stockholders' equity totaled $240.8 million, or 8.45% of total assets, at
    the end of the first quarter 2014. At March31, 2014, the Company's book
    value per share was $16.92. The market price of Metro's common stock
    increased by 28% from $16.54 per common share at March31, 2013 to $21.14
    per common share at March31, 2014.

Income Statement Overview

                                          
                                           Three months ended
                                            March 31,
(dollars in thousands, except per share    2014        2013        % Change
data)
Total revenues                              $ 30,413    $ 29,710    2     %
Provision for loan losses                   900          2,300        (61   )
Total noninterest expenses                  22,782       22,329       2
Net income                                  4,944        3,645        36
Diluted net income per share               $ 0.34     $ 0.26     31    %
                                                                            

Metro recorded net income of $4.9 million, or $0.34 per diluted common share,
for the first quarter of 2014 compared to net income of $3.6 million, or $0.26
per diluted common share, for the first quarter of 2013.

Total revenues (net interest income plus noninterest income) for the first
quarter of 2014 were $30.4 million, up $703,000, or 2%, over the first quarter
of 2013.

Noninterest expenses for the quarter totaled $22.8 million, up $453,000, or
2%, compared to the same period in 2013. On a linked quarter basis, total
noninterest expenses were up $45,000.

Net Interest Income and Net Interest Margin

Net interest income for the first quarter of 2014 totaled $23.3 million, up
$1.0 million, or 4%, over the first quarter of 2013. Average interest-earning
assets for the first quarter of 2014 totaled $2.68 billion versus $2.66
billion for the previous quarter and were up $182.2 million, or 7%, over the
first quarter of 2013. Average loans receivable increased by $222.1 million,
or 14%, and average investment securities decreased by $39.9 million, or 4%,
for the first quarter 2014 compared to the same period one year ago. Average
interest-bearing deposits totaled $1.72 billion for the first quarter of 2014,
up $36.0 million, or 2%, over the same period of 2013 and average
noninterest-bearing deposits for the first quarter 2014 were $446.1 million,
up $13.0 million, or 3%, over the first quarter last year. Total interest
expense for the quarter was down $138,000, or 7%, from the first quarter of
2013 as a result of a 5 basis points (bps) reduction in the Company's overall
total cost of all funds over the past twelve months.

The net interest margin for the first quarter of 2014 was 3.48%, up 2 bps over
the 3.46% recorded for the previous quarter and down 10 bps over the first
quarter one year ago. The net interest margin on a fully-taxable basis for the
first quarter of 2014 was 3.56%, up 1 bp over the previous quarter and down 11
bps compared to 3.67% for the first quarter of 2013.

The Bank's deposit cost of funds for the first quarter of 2014 was 0.27%,
compared to 0.28% for the previous quarter, and down 4 bps from 0.31% recorded
in the first quarter one year ago. The total cost of all funding sources for
the first quarter was 0.31%, compared to 0.33% for the previous quarter and
down 5 basis points from the same period in 2013.

Change in Net Interest Income and Rate/Volume Analysis

As shown in the following table, the increase in net interest income on a
fully tax-equivalent basis for the first quarter over the same period of 2013
was primarily due to an increase in the level of interest earning assets,
offset partially by a lower net interest margin. Lower yields on interest
earning assets were partially offset by a reduction in the Company's cost of
funds.

                       
(dollars in thousands)  Tax Equivalent Net Interest Income
                         Volume  Rate      Total     %
2014 vs. 2013           Change  Change    Increase  Increase
1st Quarter             $2,313  $(1,347)  $966      4%
                                                        

Noninterest Income

Noninterest income for the first quarter of 2014 totaled $7.1 million, down
$297,000, or 4%, from the first quarter one year ago. Service charges and fees
for the first quarter were $6.9 million, the same as the first quarter last
year. Gains on the sale of loans totaled $136,000 for the first quarter of
2014 versus $413,000 for the same period in 2013, due to a lower volume of
residential mortgage loan sales to the secondary market.

The breakdown of noninterest income for the quarters ended March31, 2014 and
2013, respectively, is shown in the table below:

                                                       
                                        Three months ended
                                         March 31,
(dollars in thousands)                  2014     2013     % Change
Service charges, fees and other income   $ 6,931  $ 6,932  —    %
Gains on sales of loans                  136       413       (67  )
Net gains on sales/calls of securities  11       30       (63  )
Total noninterest income                $ 7,078  $ 7,375  (4   )%
                                                                  

Noninterest Expenses

Noninterest expenses for the first quarter of 2014 were $22.8 million, up
$453,000, or 2%, compared to $22.3 million recorded in the first quarter one
year ago.

The breakdown of noninterest expenses for the quarters ended March31, 2014
and 2013, are shown in the table below:

                                         
                                          Three months ended
                                           March 31,
(dollars in thousands)                    2014      2013      % Change
Salaries and employee benefits             $ 11,427  $ 10,825  6     %
Occupancy and equipment                    3,505      3,210      9
Advertising and marketing                  393        356        10
Data processing                            3,250      3,206      1
Regulatory assessments and related costs   569        534        7
Other expenses                            3,638     4,198     (13   )
Total noninterest expenses                $ 22,782  $ 22,329  2     %
                                                                       

Balance Sheet

                                                        
                            As of March 31,           
                                                         %
(dollars in thousands)      2014         2013        
                                                         Increase
Total assets                 $ 2,850,039  $ 2,614,559  9    %
                                                              
Total loans (net)            1,778,311     1,546,866     15   %
                                                              
Total deposits               2,195,272     2,196,831     —    %
                                                              
Total core deposits          2,128,101     2,143,424     (1   )%
                                                              
Total stockholders' equity  240,787      236,523      2    %
                                                              

Lending

Gross loans grew by $51.4 million, (12% annualized), during the first quarter
of 2014.

Gross loans totaled $1.80 billion at March31, 2014, an increase of $227.9
million, or 14%, over March31, 2013. The Company continued to experience loan
growth in all but one category over the past twelve months as a result of
general economic improvement in the markets we serve, growth in the breadth
and experience of the lending team as well as expansion of the Bank's middle
market lending function. The composition of the Company's loan portfolio at
March31, 2014 and March31, 2013 was as follows:

                                                             
              March 31,    % of                % of   $            %
(dollars in   2014         Total  March 31,    Total  Change       Change
thousands)                          2013
Commercial
and           $ 465,931     26  %   $ 393,826     25  %   $ 72,105      18  %
industrial
Commercial    77,566        4       82,651        5       (5,085    )   (6  )
tax-exempt
Owner
occupied real 306,765       17      274,641       18      32,124        12
estate
Commercial
construction  123,789       7       99,795        6       23,994        24
and land
development
Commercial    512,582       28      427,928       27      84,654        20
real estate
Residential   98,827        6       84,845        6       13,982        16
Consumer      216,785      12    210,652      13    6,133       3   
Gross loans   $ 1,802,245  100 %  $ 1,574,338  100 %  $ 227,907   14  %
                                                                            

Asset Quality

The Company's asset quality ratios are shown below:

                                        
                                         Quarters Ended
                                          March 31,  December 31,  March 31,
                                        2014       2013          2013
Nonperforming assets/total assets         1.57   %    1.61    %      1.67   %
Net loan charge-offs                      0.02   %    1.35    %      0.03   %
(annualized)/average total loans
Loan loss allowance/total loans           1.33   %    1.32    %      1.74   %
Nonperforming loan coverage               59     %    57      %      67     %
Nonperforming assets/capital and         17     %   18      %     17     %
reserves
                                                                            

Nonperforming assets increased slightly during the first quarter of 2014 by
$52,000, to $44.9 million, or 1.57%, of total assets at March31, 2014, from
$44.8 million, or 1.61%, of total assets at December31, 2013, and compared to
$43.7 million, or 1.67%, of total assets one year ago.

Nonperforming loans increased by $539,000 during the first quarter of 2014,
while foreclosed asset balances decreased by $487,000. Compared to March31,
2013, nonperforming loans decreased $145,000 and foreclosed assets increased
$1.3 million.

Net loan charge-offs totaled $76,000 for the first quarter of 2014, comprised
of $1.5 million in gross loan charge-offs offset almost entirely by $1.4
million in recoveries. Charge-offs were primarily related to 3 larger
relationships and the recoveries related to 3 large relationships that had
been charged off in prior years.

The Company recorded a provision for loan losses of $900,000 for the first
quarter of 2014 as compared to $1.6 million for the previous quarter and to
$2.3 million recorded in the first quarter of 2013. The allowance for loan
losses totaled $23.9 million as of March31, 2014 as compared to $23.1 million
at December31, 2013 and to $27.5 million at March31, 2013. The allowance
represented 1.33% of gross loans outstanding at March31, 2014, compared to
1.32% at December31, 2013 and 1.74% at March31, 2013.

Deposits

The Company's deposit balances at March31, 2014 were $2.20 billion, compared
to total deposits of $2.24 billion at December31, 2013 and compared to $2.20
billion one year ago. The change in core deposits over the past twelve months
by type of account is as follows:

                                                                    
                            As of March 31,                       
                                                                      1st
                                                            %        Quarter
                                                                      2014
(dollars in thousands)      2014           2013           Change  Cost of
                                                                      Funds
Demand noninterest-bearing   $ 487,723       $ 482,200       1   %    0.00  %
Demand interest-bearing      1,058,734       1,066,808       (1  )    0.27
Savings                     455,956       460,057       (1  )   0.30  
Subtotal                     2,002,413       2,009,065       —        0.22
Time                        125,688       134,359       (6  )   1.06  
Total core deposits         $ 2,128,101   $ 2,143,424   (1  )%  0.27  %
                                                                            

Total core deposits, excluding time deposits, decreased $6.7 million, over the
past twelve months and decreased by $44.4 million, or 2%, on a linked quarter
basis. The cost of core deposits, excluding time deposits, during the first
quarter of 2014 was 0.22%, the same as the previous quarter and down 2 bps
from the first quarter one year ago. The cost of total core deposits for the
first quarter of 2014 was 0.27%, which was down 1 bp from the previous quarter
and down 4 bps from first quarter of 2013.

Change in core deposits by type of customer was as follows:

                                                           
                        March 31,    % of   March 31,    % of   %
(dollars in thousands)  2014         Total  2013         Total  Increase
Consumer                 $ 1,026,989   48  %   $ 1,004,920   47  %   2    %
Commercial               679,940       32      669,783       31      2
Government              421,172      20    468,721      22    (10  )
Total                   $ 2,128,101  100 %  $ 2,143,424  100 %  (1   )%
                                                                          

Investments

At March31, 2014, the Company's investment portfolio totaled $859.9 million,
down $9.9 million, or 1%, on a linked quarter basis and down $35.4 million, or
4%, compared to March31, 2013. Detailed below is information regarding the
composition and characteristics of the portfolio at March31, 2014:

                                                             
                                      Available    Held to     
Product Description                   for Sale     Maturity     Total
(dollars in thousands)
U.S. Government agencies/other         $ 30,888      $ 149,100     $ 179,988
Mortgage-backed securities:
Federal government agencies pass       62,400        7,619         70,019
through certificates
Agency collateralized mortgage         459,484       115,401       574,885
obligations
Corporate debt securities              —             5,000         5,000
Municipal securities                  27,019      2,976       29,995    
Total                                 $ 579,791   $ 280,096   $ 859,887 
Duration (in years)                    4.9           6.5           5.4
Average life (in years)                5.6           7.5           6.2
Quarterly average yield (annualized)  2.26      %  2.53      %  2.35      %
                                                                             

At March31, 2014, the after-tax unrealized loss on the Bank's available for
sale portfolio was $11.0 million, as compared to an unrealized loss of $16.5
million at December 31, 2013 and compared to an after-tax unrealized gain of
$4.6 million at March31, 2013.

Capital

Stockholders' equity at March31, 2014 totaled $240.8 million, compared to
$236.5 million at March31, 2013. Return on average stockholders' equity (ROE)
for the first quarter of 2014 was 8.42%, compared to 8.30% for the previous
quarter and up over 6.28% for the first quarter last year.

The Company's capital ratios at March31, 2014 and 2013 were as follows:

                                   
                                      Regulatory
                                         Guidelines “Well
               3/31/2014  3/31/2013  Capitalized”
Leverage ratio   9.48   %    9.40   %    5.00       %
Tier 1           13.39       13.94       6.00
Total capital   14.59     15.19     10.00      
                                                    

Both the Company and its subsidiary bank continue to maintain strong capital
ratios and are well capitalized under various regulatory capital guidelines as
required by federal banking agencies.

At March31, 2014, the Company's book value per common share was $16.92.

The market price of Metro's common stock increased by 28% from $16.54 per
common share at March31, 2013 to $21.14 per common share at March31, 2014.

Forward-Looking Statements

This document contains forward-looking statements, within the meaning of
Section 27A of the Securities Act of 1933, as amended, which we refer to as
the Securities Act and Section 21E of the Securities Exchange Act of 1934,
which we refer to as the Exchange Act, with respect to the financial
condition, liquidity, results of operations, future performance and business
of Metro Bancorp, Inc. These forward-looking statements are intended to be
covered by the safe harbor for "forward-looking statements" provided by the
Private Securities Litigation Reform Act of 1995. Forward-looking statements
are those that are not historical facts. These forward-looking statements
include statements with respect to our beliefs, plans, objectives, goals,
expectations, anticipations, estimates and intentions that are subject to
significant risks and uncertainties and are subject to change based on various
factors (some of which are beyond our control). The words "may," "could,"
"should," "would," "believe," "anticipate," "estimate," "expect," "intend,"
"plan" and similar expressions are intended to identify forward-looking
statements.

While we believe our plans, objectives, goals, expectations, anticipations,
estimates and intentions as reflected in these forward-looking statements are
reasonable, we can give no assurance that any of them will be achieved. You
should understand that various factors, in addition to those discussed
elsewhere in this document, could affect our future results and could cause
results to differ materially from those expressed in these forward-looking
statements, including:

  *the effects of and changes in, trade, monetary and fiscal policies,
    including interest rate policies of the Board of Governors of the Federal
    Reserve System, including the duration of such policies;
  *general economic or business conditions, either nationally, regionally or
    in the communities in which we do business, may be less favorable than
    expected, resulting in, among other things, a deterioration in credit
    quality and loan performance or a reduced demand for credit;
  *the effects of ongoing short and long-term federal budget and tax
    negotiations and their effects on economic and business conditions in
    general and our customers in particular;
  *the effects of the failure of the federal government to reach a deal to
    permanently raise the debt ceiling and the potential negative results on
    economic and business conditions;
  *the impact of the Dodd-Frank Act and other changes in financial services’
    laws and regulations (including laws concerning taxes, banking, securities
    and insurance);
  *possible impacts of the capital and liquidity requirements of the Basel
    III standards and other regulatory pronouncements;
  *continued effects of the aftermath of recessionary conditions and the
    impacts on the economy in general and our customers in particular,
    including adverse impacts on loan utilization rates as well as
    delinquencies, defaults and customers' ability to meet credit obligations;
  *our ability to manage current levels of impaired assets;
  *continued levels of loan volume origination;
  *the adequacy of the allowance for loan losses;
  *the impact of changes in Regulation Z and other consumer credit protection
    laws and regulations;
  *changes resulting from legislative and regulatory actions with respect to
    the current economic and financial industry environment;
  *changes in the FDIC deposit fund and the associated premiums that banks
    pay to the fund;
  *interest rate, market and monetary fluctuations;
  *the results of the regulatory examination and supervision process;
  *unanticipated regulatory or legal proceedings and liabilities and other
    costs;
  *compliance with laws and regulatory requirements of federal, state and
    local agencies;
  *our ability to continue to grow our business internally or through
    acquisitions and successful integration of new or acquired entities while
    controlling costs;
  *deposit flows;
  *the willingness of customers to substitute competitors’ products and
    services for our products and services and vice versa, based on price,
    quality, relationship or otherwise;
  *changes in consumer spending and saving habits relative to the financial
    services we provide;
  *the ability to hedge certain risks economically;
  *the loss of certain key officers;
  *changes in accounting principles, policies and guidelines as may be
    adopted by the regulatory agencies, as well as the Public Company
    Accounting Oversight Board, the Financial Accounting Standards Board
    (FASB), and other accounting standards setters;
  *the timely development of competitive new products and services by us and
    the acceptance of such products and services by customers;
  *rapidly changing technology;
  *continued relationships with major customers;
  *effect of terrorist attacks and threats of actual war;
  *other economic, competitive, governmental, regulatory and technological
    factors affecting the Company’s operations, pricing, products and
    services;
  *interruption or breach in security of our information systems resulting in
    failures or disruptions in customer account management, general ledger
    processing and loan or deposit systems;
  *our ability to maintain compliance with the exchange rules of The Nasdaq
    Stock Market, Inc.;
  *our ability to maintain the value and image of our brand and protect our
    intellectual property rights;
  *disruptions due to flooding, severe weather or other natural disasters or
    Acts of God; and
  *our success at managing the risks involved in the foregoing.

Because such forward-looking statements are subject to risks and
uncertainties, actual results may differ materially from those expressed or
implied by such statements. The foregoing list of important factors is not
exclusive and you are cautioned not to place undue reliance on these factors
or any of our forward-looking statements, which speak only as of the date of
this document or, in the case of documents incorporated by reference, the
dates of those documents. We do not undertake to update any forward-looking
statements, whether written or oral, that may be made from time to time by or
on behalf of us except as required by applicable law.


Metro Bancorp, Inc. and Subsidiaries
Selected Consolidated Financial Data
               At or for the
              Three Months Ended
                March 31,      December 31,   %       March 31,      %
(dollars in
thousands,
except per     2014           2013           Change  2013           Change
share
amounts)
Income
Statement
Data:
Net interest    $ 23,335        $ 23,329        —    %   $ 22,335        4    %
income
Provision for   900             1,575           (43  )   2,300           (61  )
loan losses
Noninterest     7,078           7,965           (11  )   7,375           (4   )
income
Total           30,413          31,294          (3   )   29,710          2
revenues
Noninterest     22,782          22,737          —        22,329          2
expenses
Net income      4,944           4,891           1        3,645           36
Per Common
Share Data:
Net income
per common
share:
Basic           $ 0.35          $ 0.34          3    %   $ 0.26          35   %
Diluted         0.34            0.34            —        0.26            31
                                                                              
Book Value      $ 16.92         $ 16.19                  $ 16.66
                                                                              
Weighted
average
common shares
outstanding:
Basic           14,161          14,155                   14,132
Diluted         14,344          14,359                   14,161
Balance Sheet
Data:
Total assets    $ 2,850,039     $ 2,781,118     2    %   $ 2,614,559     9    %
Loans (net)     1,778,311       1,727,762       3        1,546,866       15
Allowance for   23,934          23,110          4        27,472          (13  )
loan losses
Investment      859,887         869,737         (1   )   895,333         (4   )
securities
Total           2,195,272       2,239,621       (2   )   2,196,831       —
deposits
Core deposits   2,128,101       2,176,600       (2   )   2,143,424       (1   )
Stockholders'   240,787         230,183         5        236,523         2
equity
Capital:
Total
stockholders'   8.45        %   8.28        %            9.05        %
equity to
assets
Leverage        9.48            9.39                     9.40
ratio
Risk based
capital
ratios:
Tier 1          13.39           13.41                    13.94
Total Capital   14.59           14.59                    15.19
Performance
Ratios:
Deposit cost    0.27        %   0.28        %            0.31        %
of funds
Cost of funds   0.31            0.33                     0.36
Net interest    3.48            3.46                     3.58
margin
Return on
average         0.72            0.70                     0.56
assets
Return on
average         8.42            8.30                     6.28
stockholders'
equity
Asset
Quality:
Net
charge-offs
(annualized)    0.02        %   1.35        %            0.03        %
to average
loans
outstanding
Nonperforming
assets to
total           1.57            1.61                     1.67
period-end
assets
Allowance for
loan losses
to total        1.33            1.32                     1.74
period-end
loans
Allowance for
loan losses
to period-end   59              57                       67
nonperforming
loans
Nonperforming
assets to      17            18                  17                
capital and
allowance
                                                                              


Metro Bancorp, Inc. and Subsidiaries
Consolidated Balance Sheets
                                                                       
                                                March 31,      December 31,
                                                 2014            2013
(in thousands, except share and per share       (Unaudited)               
amounts)
                                                                             
Assets                                                                  
Cash and cash equivalents                        $ 77,728        $ 44,996
Securities, available for sale at fair value     579,791         585,923
Securities, held to maturity at cost (fair       280,096         283,814
value 2014: $265,374; 2013: $263,697)
Loans, held for sale                             3,541           6,225
Loans receivable, net of allowance for loan
losses (allowance 2014: $23,934; 2013:           1,778,311       1,727,762
$23,110)
Restricted investments in bank stock             21,557          20,564
Premises and equipment, net                      75,055          75,783
Other assets                                    33,960        36,051      
Total assets                                    $ 2,850,039   $ 2,781,118 
                                                                 
Liabilities and Stockholders' Equity                          
Deposits:
Noninterest-bearing                              $ 487,723       $ 443,287
Interest-bearing                                1,707,549     1,796,334   
Total deposits                                   2,195,272       2,239,621
Short-term borrowings                            380,189         277,750
Long-term debt                                   15,800          15,800
Other liabilities                               17,991        17,764      
Total liabilities                                2,609,252       2,550,935
Stockholders' Equity:
Preferred stock - Series A noncumulative;
$10.00 par value; $1,000 liquidation             400             400
preference; (1,000,000 shares authorized;
40,000 shares issued and outstanding)
Common stock - $1.00 par value; 25,000,000
shares authorized; (issued and outstanding       14,167          14,157
shares 2014: 14,166,960; 2013: 14,157,219)
Surplus                                          158,825         158,650
Retained earnings                                78,415          73,491
Accumulated other comprehensive loss            (11,020     )  (16,515     )
Total stockholders' equity                      240,787       230,183     
Total liabilities and stockholders' equity      $ 2,850,039   $ 2,781,118 
                                                                             

                                                                  
Metro Bancorp, Inc. and Subsidiaries
Consolidated Statements of Income (Unaudited)
                                                                 
                                                          Three Months Ended
                                                          March 31,
(in thousands, except per share amounts)                 2014      2013
Interest Income                                                   
Loans receivable, including fees:
Taxable                                                   $ 19,210   $ 17,971
Tax-exempt                                                861        931
Securities:
Taxable                                                   5,046      5,359
Tax-exempt                                               190       184
Total interest income                                    25,307    24,445
Interest Expense                                                  
Deposits                                                  1,434      1,619
Short-term borrowings                                     231        131
Long-term debt                                           307       360
Total interest expense                                   1,972     2,110
Net interest income                                       23,335     22,335
Provision for loan losses                                900       2,300
Net interest income after provision for loan losses      22,435    20,035
Noninterest Income                                                
Service charges, fees and other operating income          6,931      6,932
Gains on sales of loans                                  136       413
Total fees and other income                              7,067     7,345
Net gains on sales/calls of securities                   11        30
Total noninterest income                                 7,078     7,375
Noninterest Expenses                                              
Salaries and employee benefits                            11,427     10,825
Occupancy and equipment                                   3,505      3,210
Advertising and marketing                                 393        356
Data processing                                           3,250      3,206
Regulatory assessments and related costs                  569        534
Other                                                    3,638     4,198
Total noninterest expenses                               22,782    22,329
Income before taxes                                       6,731      5,081
Provision for federal income taxes                       1,787     1,436
Net income                                               $ 4,944   $ 3,645
Net Income per Common Share
Basic                                                     $ 0.35     $ 0.26
Diluted                                                  0.34      0.26
Average Common and Common Equivalent Shares Outstanding
Basic                                                     14,161     14,132
Diluted                                                  14,344    14,161
                                                                     


Metro Bancorp, Inc. and Subsidiaries Average Balances and Net Interest Income
(unaudited)
                                                                                                           
                                                                                                     
                        Quarters ended,
                      March 31, 2014                   December 31, 2013                March 31, 2013
                        Average                  Avg.     Average                  Avg.     Average                  Avg.
                        Balance      Interest  Rate    Balance      Interest  Rate    Balance      Interest  Rate
(dollars in
thousands)
Earning Assets
Investment
securities:
Taxable                 $ 876,249     $ 5,046    2.30 %   $ 894,620     $ 5,165    2.31 %   $ 917,165     $ 5,359    2.34 %
Tax-exempt             30,927       293       3.79   30,446       289       3.79   29,869       283       3.80 
Total securities        907,176       5,339      2.35     925,066       5,454      2.36     947,034       5,642      2.38
Total loans            1,775,981    20,534    4.63   1,731,862    20,527    4.66   1,553,914    19,403    5.01 
receivable
Total earning assets   $ 2,683,157  $ 25,873  3.86 %  $ 2,656,928  $ 25,981  3.86 %  $ 2,500,948  $ 25,045  4.01 %
Sources of Funds
Interest-bearing
deposits:
Regular savings         $ 460,324     $ 336      0.30 %   $ 448,976     $ 356      0.31 %   $ 414,297     $ 326      0.32 %
Interest checking and   1,070,068     719        0.27     1,112,292     770        0.27     1,077,739     802        0.30
money market
Time deposits           126,453       329        1.06     126,523       380        1.19     138,630       447        1.31
Public time and other  64,717       50        0.32   61,977       51        0.33   54,926       44        0.32 
noncore deposits
Total
interest-bearing        1,721,562     1,434      0.34     1,749,768     1,557      0.35     1,685,592     1,619      0.39
deposits
Short-term borrowings   356,554       231        0.26     320,644       211        0.26     228,911       131        0.23
Long-term debt         15,800       307       7.77   15,800       306       7.77   36,911       360       3.90 
Total
interest-bearing        2,093,916     1,972      0.38     2,086,212     2,074      0.39     1,951,414     2,110      0.44
liabilities
Demand deposits        446,131                     433,944                      433,085               
(noninterest-bearing)
Sources to fund         2,540,047     1,972      0.31     2,520,156     2,074      0.33     2,384,499     2,110      0.36
earning assets
Noninterest-bearing    143,110                      136,772                      116,449               
funds (net)
Total sources to fund  $ 2,683,157  $ 1,972   0.30 %  $ 2,656,928  $ 2,074   0.31 %  $ 2,500,948  $ 2,110   0.34 %
earning assets
                                                                                                                          
Net interest income
and margin on a tax-                  $ 23,901   3.56 %                 $ 23,907   3.55 %                 $ 22,935   3.67 %
equivalent basis
Tax-exempt adjustment                 566                              578                              600      
Net interest income                $ 23,335  3.48 %              $ 23,329  3.46 %              $ 22,335  3.58 %
and margin
                                                                                                                          
Other Balances:
Cash and due from       $ 43,752                          $ 46,666                          $ 42,817
banks
Other assets            68,553                            68,529                            91,967
Total assets            2,795,462                         2,772,123                         2,635,732
Other liabilities       17,253                            18,331                            15,790
Stockholders' equity   238,162                     233,636                     235,443                   
                                                                                                                          

                                                              
Metro Bancorp, Inc. and Subsidiaries
Summary of Allowance for Loan Losses and Other Related Data
(Unaudited)
                                                                    
                                        Three Months Ended        Year Ended
                                        March 31,                 December 31,
(dollars in thousands)                 2014        2013        2013
                                                                             
Balance at beginning of period          $ 23,110     $ 25,282     $  25,282
Provisions charged to operating        900        2,300      6,875      
expenses
                                        24,010       27,582       32,157
Recoveries of loans previously
charged-off:
Commercial and industrial               1,005        138          1,122
Commercial tax-exempt                   —            —            —
Owner occupied real estate              243          3            3
Commercial construction and land        100          486          490
development
Commercial real estate                  73           —            —
Residential                             —            3            10
Consumer                               23         36         76         
Total recoveries                       1,444      666        1,701      
Loans charged-off:
Commercial and industrial               (354     )   (36      )   (3,427     )
Commercial tax-exempt                   —            —            —
Owner occupied real estate              (25      )   (184     )   (295       )
Commercial construction and land        (12      )   (17      )   (2,844     )
development
Commercial real estate                  (716     )   (82      )   (2,773     )
Residential                             (283     )   (116     )   (332       )
Consumer                               (130     )  (341     )  (1,077     )
Total charged-off                      (1,520   )  (776     )  (10,748    )
Net charge-offs                        (76      )  (110     )  (9,047     )
Balance at end of period               $ 23,934   $ 27,472   $  23,110  
Net charge-offs (annualized) as a
percentage of average loans             0.02     %   0.03     %   0.55       %
outstanding
Allowance for loan losses as a          1.33     %   1.74     %   1.32       %
percentage of period-end loans
                                                                             

                                                               
Metro Bancorp, Inc. and Subsidiaries
Summary of Nonperforming Loans and Assets
(Unaudited)
                                                                              
The following table presents information regarding nonperforming loans and
assets as of March 31, 2014 and for the preceding four quarters (dollar amounts
in thousands).
                                                               
                 March 31,    December     September    June 30,     March 31,
                              31,          30,
               2014        2013        2013        2013        2013
Nonperforming
Assets
Nonaccrual
loans:
Commercial and   $ 9,014      $ 10,217     $ 9,967      $ 12,053     $ 12,451
industrial
Commercial       —            —            —            —            —
tax-exempt
Owner occupied   6,005        4,838        4,924        4,999        3,428
real estate
Commercial
construction     10,734       8,587        11,723       12,027       12,024
and land
development
Commercial       6,043        6,705        6,904        3,893        5,575
real estate
Residential      6,551        7,039        7,316        7,133        3,295
Consumer        2,524      2,577      2,541      3,422      2,517    
Total
nonaccrual       40,871       39,963       43,375       43,527       39,290
loans
Loans past due
90 days or      —          369        119        —          1,726    
more and still
accruing
Total
nonperforming    40,871       40,332       43,494       43,527       41,016
loans
Foreclosed      3,990      4,477      3,556      4,611      2,675    
assets
Total
nonperforming   $ 44,861   $ 44,809   $ 47,050   $ 48,138   $ 43,691 
assets
                                                                              
Troubled Debt
Restructurings
(TDRs)
Nonaccruing
TDRs (included   $ 19,862     $ 17,149     $ 23,621     $ 18,817     $ 18,927
in nonaccrual
loans above)
Accruing TDRs   9,970      12,091     11,078     14,888     14,308   
Total TDRs      $ 29,832   $ 29,240   $ 34,699   $ 33,705   $ 33,235 
                                                                              
Nonperforming
loans to total   2.27     %   2.30     %   2.55     %   2.66     %   2.61     %
loans
                                                                              
Nonperforming
assets to        1.57     %   1.61     %   1.71     %   1.81     %   1.67     %
total assets
                                                                              
Nonperforming    59       %   57       %   63       %   64       %   67       %
loan coverage
                                                                              
Allowance for
loan losses as
a percentage     1.33     %   1.32     %   1.61     %   1.72     %   1.74     %
of total
period-end
loans
                                                                              
Nonperforming
assets /
capital plus    17       %  18       %  18       %  19       %  17       %
allowance for
loan losses
                                                                              

Contact:

Metro Bancorp, Inc.
Gary L. Nalbandian
Chairman/President
717-412-6301
or
Mark A. Zody
Chief Financial Officer
717-412-6301
 
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