Bancorp, Inc. - FORM 8-K - EX-99.1 - EXHIBIT 99.1

Attached files

file	filename
8-K - THE BANCORP, INC. FORM 8-K - Bancorp, Inc.	bancorp8k.htm

The Bancorp, Inc. Reports First Quarter 2012 Financial Results

Wilmington, Delaware – April 24, 2012 – The Bancorp, Inc. ("Bancorp") (NASDAQ: TBBK), a financial holding company, today reported financial results for the quarter ended March 31, 2012.

Financial Highlights

·	Net income for the first quarter of 2012 increased by 48%, to $4.0 million compared to $2.7 million in the same quarter of 2011. Diluted earnings per share for the first quarter of 2012 increased to $0.12 on 33.1 million shares versus $0.10 on 28.1 million shares in the same quarter of 2011.

Key factors driving these results were:

90% increase in quarterly prepaid card fees to $9.0 million compared to $4.8 million in first quarter 2011.

15% increase in quarterly net interest income to $20.9 million compared to $18.2 million in first quarter 2011.

58% increase in quarterly non-interest income (including prepaid card fees) to $12.3 million compared to $7.7 million in first quarter 2011 excluding security gains and other than temporary impairment (OTTI).

At March 31, 2012 the portfolio of loans and securities had grown to $2.2 billion, an increase of $323 million, or 17% over first quarter 2011. Outstanding loans increased 7% over that period.

Average deposits for first quarter 2012 totaled $3.8 billion, an increase of $1.1 billion or 39% over 2011, reflecting growth in all major deposit categories. The interest paid on deposits between those respective periods decreased to 0.29% from 0.38%.

Betsy Z. Cohen, Bancorp’s Chief Executive Officer, said, “First quarter 2012 saw a continuation in our earnings growth as a result of significant increases in both our non-interest and net-interest income. Quarterly net income of $4.0 million was achieved notwithstanding $1.5 million of other real estate owned (OREO) charges and an increase in the loan loss provision. Adjusted operating earnings, a non-GAAP measure, increased to $12.9 million, a $4.0 million, or 44% increase over the prior year period. Our position as a leader in the prepaid card space continues to drive the increase in non-interest income. On the asset side, we grew our loans 7% over the year in a difficult lending environment. We continue to target what we believe to be lower risk assets including Small Business Administration (SBA) loans, security backed lines of credit and vehicle fleet leasing. Leasing balances grew 21% over the year to $130 million and we have recently added relationships which should result in additional security backed line of credit balances. The Company is well capitalized, and book value per share increased from $7.76 at March 31, 2011, to $8.41, or an increase of 8%. We note that our leverage capital ratio was distorted during the quarter as a result of the seasonal deposits referenced earlier, and that we expect that the ratio will increase next quarter as these balances terminate. ”

Financial Results

Bancorp reported net income available to common shareholders for the three months ended March 31, 2012 of $4.0 million or diluted earnings per share of $0.12, based on 33,107,037 weighted average shares outstanding, compared to net income available to common shareholders of $2.7 million or diluted earnings per share of $0.10, based on 28,058,333 weighted average shares outstanding, for the three months ended March 31, 2011. Adjusted operating earnings, a non-GAAP measure, increased to $12.9 million for the three months ended March 31, 2012 compared to $8.9 million for the three months ended March 31, 2011. The following is a reconciliation of adjusted operating earnings to net income available to common shareholders (for the three month period):

	March 31,		March 31,
	2012		2011

Net income available to common shareholders	$	3,972	$	2,688
Income tax expense		2,227		1,431
Other than temporary impairment in securities		-		75
Losses and write downs on other real estate owned		1,451		52
Provision for loan and lease losses		5,220		4,672
Adjusted operating earnings (1)	$	12,870	$	8,918

(1)

As a supplement to GAAP, Bancorp has provided this non-GAAP performance result. The Bancorp believes that this non-GAAP financial measure is useful because it allows investors to assess its operating performance. Management utilizes adjusted operating earnings to measure the combined impact of changes in net interest income, non-interest income and certain other expenses. Other companies may calculate adjusted operating earnings differently. Although this non-GAAP financial measure is intended to enhance investors’ understanding of Bancorp’s business and performance, it should not be considered, and is not intended to be, a substitute for GAAP.

Balance Sheet Summary

At March 31, 2012, Bancorp's total assets were $4.1 billion, an increase of $1.3 billion or 45% over total assets at March 31, 2011. During that period, investments increased to $500 million, an increase of $211 million or 73%; loans increased to $1.7 billion, an increase of $113 million or 7%; and deposits increased to $3.8 billion, an increase of $1.2 billion or 49%. Total assets increased compared to March 31, 2011, primarily as a result of deposit growth.

Conference Call Webcast

You may access the LIVE webcast of Bancorp's Quarterly Earnings Conference Call at 8:30 AM EDT Wednesday, April 25, 2012 by clicking on the webcast link on Bancorp's homepage at www.thebancorp.com. Or, you may dial 888.268.4176, access code 16809756. You may listen to the replay of the webcast following the live call on Bancorp's investor relations website or telephonically until Wednesday, May 2, 2012 by dialing 888.286.8010, access code 65379042.

About Bancorp

The Bancorp, Inc. is a financial holding company that operates The Bancorp Bank, an FDIC-insured commercial bank that delivers a full array of financial services both directly and through private-label affinity programs nationwide. The Bancorp Bank’s regional community bank operations serve the needs of small and mid-size businesses and their principals in the Philadelphia-Wilmington region.

Forward Looking Statements

Statements in this earnings release regarding The Bancorp, Inc.’s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. These statements may be identified by the use of forward-looking terminology, including but not limited to the words “may,” “believe,” “will,” “expect,” “look,” “anticipate,” “estimate,” “continue,” or similar words. For further discussion of the risks and uncertainties to which these forward-looking statements may be subject, see The Bancorp, Inc.’s filings with the SEC, including the “Risk Factors” sections of The Bancorp Inc.’s filings. These risks and uncertainties could cause actual results to differ materially from those projected in the forward-looking statements. The forward-looking statements speak only as of the date of this presentation. The Bancorp, Inc. does not undertake to publicly revise or update forward-looking statements in this presentation to reflect events or circumstances that arise after the date of this presentation, except as may be required under applicable law.

The Bancorp, Inc. Contact

Andres Viroslav

215-861-7990

aviroslav@thebancorp.com

	Three months ended					Year ended
	March 31,					December 31,
	2012		2011			2011
	(dollars in thousands except per share data)
Condensed income statement
Net interest income	$	20,916	$	18,198		$	76,406
Provision for loan and lease losses		5,220		4,672			21,498
Non-interest income
Gain on sales of investment securities		-		-			759
Other than temporary impairment of investment securities		-		(75	)		(75	)
Other non-interest income		12,290		7,758			29,841
Total non-interest income		12,290		7,683			30,525
Non-interest expense
Losses and write downs on other real estate owned		1,451		52			555
Other non-interest expense		20,336		17,038			71,649
Total non-interest expense		21,787		17,090			72,204
Net income before income tax expense		6,199		4,119			13,229
Income tax expense		2,227		1,431			4,311
Net income		3,972		2,688			8,918
Less preferred stock dividends		-		-			-
Less preferred stock accretion		-		-			-
Net income available to common shareholders	$	3,972	$	2,688		$	8,918

Basic earnings per share	$	0.12	$	0.10		$	0.28

Diluted earnings per share	$	0.12	$	0.10		$	0.28
Weighted average shares - basic		33,097,325		28,051,948			31,927,815
Weighted average shares - diluted		33,107,037		28,058,333			31,933,592

Balance sheet	March 31,			December 31,			September 30,			March 31,
	2012			2011			2011			2011
	(dollars in thousands)
Assets:
Cash and cash equivalents
Cash and due from banks	$	142,123		$	96,228		$	259,116		$	223,420
Interest earning deposits at Federal Reserve Bank		1,663,664			652,946			932,152			630,524
Total cash and cash equivalents		1,805,787			749,174			1,191,268			853,944

Investment securities, available-for-sale, at fair value		481,553			448,204			416,362			267,715
Investment securities, held-to-maturity		17,971			18,044			18,095			21,298
Federal Home Loan Bank & Atlantic Central Bankers Bank stock		4,836			5,088			5,354			5,928

Loans, net of deferred costs		1,748,867			1,744,828			1,715,648			1,636,253
Allowance for loan and lease losses		(31,500	)		(29,568	)		(27,671	)		(25,802	)
Loans, net of deferred costs		1,717,367			1,715,260			1,687,977			1,610,451
Premises and equipment, net		8,514			8,358			8,307			8,533
Accrued interest receivable		9,032			8,476			8,541			8,807
Intangible assets, net		7,754			8,004			8,254			8,754
Other real estate owned		7,726			7,405			6,415			3,379
Deferred tax asset, net		20,804			21,941			19,902			23,817
Other assets		22,703			20,727			22,538			24,071
Total assets	$	4,104,047		$	3,010,681		$	3,393,013		$	2,836,697

Liabilities:
Deposits
Demand (non-interest bearing)	$	2,441,256		$	1,424,913		$	1,866,259		$	1,412,656
Savings, money market and interest checking		1,302,538			1,222,368			1,171,349			1,105,226
Time deposits		20,637			25,528			25,552			1,397
Time deposits, $100,000 and over		9,447			9,742			10,341			11,830
Total deposits		3,773,878			2,682,551			3,073,501			2,531,109

Securities sold under agreements to repurchase		25,906			33,177			25,057			19,783
Accrued interest payable		129			123			113			149
Subordinated debenture		13,401			13,401			13,401			13,401
Other liabilities		12,500			9,950			12,262			14,654
Total liabilities	$	3,825,814		$	2,739,202		$	3,124,334		$	2,579,096

Shareholders' equity:
Common stock - authorized, 50,000,000 shares of $1.00 par value; 33,101,281 and 33,196,281 shares issued at March 31, 2012 and 2011, respectively		33,201			33,196			33,196			33,196
Treasury stock (100,000 shares)		(866	)		(866	)		-			-
Additional paid-in capital		242,661			241,997			241,473			240,640
Accumulated deficit		(5,305	)		(9,277	)		(12,565	)		(15,507	)
Accumulated other comprehensive (loss) gain		8,542			6,429			6,575			(728	)
Total shareholders' equity		278,233			271,479			268,679			257,601

Total liabilities and shareholders' equity	$	4,104,047		$	3,010,681		$	3,393,013		$	2,836,697

Average balance sheet and net interest income	Three months ended March 31, 2012								Three months ended March 31, 2011
(dollars in thousands)	Average					Average			Average					Average
Assets:	Balance			Interest		Rate			Balance			Interest		Rate
Interest-earning assets:
Loans net of unearned discount	$	1,733,736		$	18,823		4.34	%	$	1,627,928		$	18,260		4.49	%
Leases - bank qualified*		10,439			189		7.24	%		2,344			50		8.53	%
Investment securities-taxable		369,921			3,190		3.45	%		179,469			1,557		3.47	%
Investment securities-nontaxable*		96,384			1,066		4.42	%		77,592			1,011		5.21	%
Interest earning deposits at Federal Reserve Bank		1,698,456			1,053		0.25	%		833,085			515		0.25	%
Net interest earning assets		3,908,936			24,321		2.49	%		2,720,418			21,393		3.15	%

Allowance for loan and lease losses		(30,638	)							(24,811	)
Other assets		229,504								292,667
	$	4,107,802							$	2,988,274

Liabilities and Shareholders' Equity:
Deposits:
Demand (non-interest bearing)**	$	2,487,860		$	412		0.07	%	$	1,647,682		$	425		0.10	%
Interest bearing deposits
Interest checking		804,788			1,582		0.79	%		714,846			1,279		0.72	%
Savings and money market		457,855			631		0.55	%		321,472			797		0.99	%
Time		31,355			97		1.24	%		46,507			104		0.89	%
Total interest bearing deposits		1,293,998			2,310		0.71	%		1,082,825			2,180		0.81	%
Total deposits		3,781,858			2,722		0.29	%		2,730,507			2,605		0.38	%

Short-term borrowings		-			-		0.00	%		3,022			3		0.40	%
Repurchase agreements		28,259			27		0.38	%		17,030			16		0.38	%
Subordinated debt		13,401			217		6.48	%		13,401			215		6.42	%
Net interest bearing liabilities		1,335,658			2,554		0.76	%		1,116,278			2,414		0.87	%
Total deposits and interest bearing liabilities		3,823,518			2,966		0.31	%		2,763,960			2,839		0.41	%

Other liabilities		10,598								9,435
Total liabilities		3,834,116								2,773,395

Shareholders' equity		273,686								214,879
	$	4,107,802							$	2,988,274
Net interest income on tax equivalent basis*				$	21,355							$	18,554

Tax equivalent adjustment					439								356

Net interest income				$	20,916							$	18,198
Net interest margin *							2.19	%							2.73	%

* Full taxable equivalent basis, using a 35% statutory tax rate.
** Non-interest bearing demand accounts are not paid interest. The amount shown as interest reflects the fees paid to affinity groups, which are based upon a rate index, and therefore classified as interest expense.

Allowance for loan and lease losses:	Three months ended						For year ended
	March 31,			March 31,			December 31,
	2012			2011			2011
	(dollars in thousands)

Balance in the allowance for loan and lease losses at beginning of period	$	29,568		$	24,063		$	24,063

Loans charged-off:
Commercial		2,448			106			8,651
Construction		702			2,143			3,254
Lease financing		86			-			39
Residential mortgage		-			31			2,870
Consumer		172			668			1,280
Total		3,408			2,948			16,094

Recoveries:
Commercial		36			14			91
Construction		1			1			4
Lease financing		-			-			-
Residential mortgage		83			-			-
Consumer		-			-			6
Total		120			15			101
Net charge-offs		3,288			2,933			15,993
Provision charged to operations		5,220			4,672			21,498

Balance in allowance for loan and lease losses at end of period	$	31,500		$	25,802		$	29,568
Net charge-offs/average loans		0.19	%		0.18	%		0.96	%


Loan portfolio:	March 31,			December 31,			September 30,			March 31,
		2012			2011			2011			2011
	(dollars in thousands)

Commercial	$	445,912		$	450,411		$	461,679		$	430,081
Commercial mortgage (1)		617,871			609,487			577,237			601,046
Construction		248,232			246,611			242,806			202,105
Total commercial loans		1,312,015			1,306,509			1,281,722			1,233,232
Direct lease financing		130,321			129,682			129,400			107,624
Residential mortgage		94,438			96,110			96,139			94,682
Consumer loans and others		208,584			209,041			205,243			197,876
		1,745,358			1,741,342			1,712,504			1,633,414
Unamortized loan costs		3,509			3,486			3,144			2,839
Total loans, net of deferred loan costs	$	1,748,867		$	1,744,828		$	1,715,648		$	1,636,253

Supplemental loan data:
Construction 1-4 family	$	85,461		$	85,189		$	91,783		$	96,240
Commercial construction, acquisition and development		162,771			161,422			151,023			105,865
	$	248,232		$	246,611		$	242,806		$	202,105
(1) At March 31, 2012 our owner-occupied loans amounted to $144 million, or 23.3% of commercial mortgages.

Capital Ratios

	Tier 1 capital			Tier 1 capital			Total capital
	to average			to risk-weighted			to risk-weighted
	assets ratio			assets ratio			assets ratio

As of March 31, 2012
The Company		6.59	%		14.94	%		16.19	%
The Bancorp Bank		5.41	%		12.29	%		13.54	%
"Well capitalized" institution (under FDIC regulations)		5.00	%		6.00	%		10.00	%

As of March 31, 2011
The Company		8.62	%		15.33	%		16.58	%
The Bancorp Bank		6.00	%		10.69	%		11.94	%
"Well capitalized" institution (under FDIC regulations)		5.00	%		6.00	%		10.00	%

	Three months ended									Year ended
	March 31,						December 31,			December 31,
	2012			2011			2011			2011
Selected operating ratios:
Return on average assets		0.39	%		0.36	%		0.43	%		0.31	%
Return on average equity		5.84	%		5.07	%		4.84	%		3.54	%
Net interest margin		2.19	%		2.73	%		2.89	%		2.96	%
Efficiency ratio (1)		65.61	%		66.03	%		67.21	%		67.96	%
Book value per share	$	8.41		$	7.76		$	8.18		$	8.18

(1) Excluding the impact of the OREO losses in the first quarter of 2012 the efficiency ratio would have been 61.24%


	March 31,			December 31,			September 30,			March 31,
		2012			2011			2011			2011
Asset quality ratios:
Nonperforming loans to total loans (1)		1.42	%		1.24	%		1.33	%		1.05	%
Nonperforming assets to total assets (1)		0.79	%		0.97	%		0.86	%		0.73	%
Allowance for loan and lease losses to total loans		1.80	%		1.69	%		1.61	%		1.58	%

Nonaccrual loans	$	20,929		$	17,587		$	17,201		$	14,228
Other real estate owned		7,726			7,405			6,415			3,379
Total nonperforming assets	$	28,655		$	24,992		$	23,616		$	17,607

Loans 90 days past due still accruing interest	$	3,914		$	4,101		$	5,550		$	3,028
(1) Nonperforming loans are defined as nonaccrual loans and restructure loans. Loans 90 days past due and still accruing interest are also included in these ratios.

Bancorp, Inc. - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - April 24, 2012

Attached files

Bancorp, Inc. Reports