Attached files
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| 8-K - OLD LINE BANCSHARES, INC. FORM 8-K - OLD LINE BANCSHARES INC | oldline8k.htm |
EXHIBIT 99.1
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PRESS RELEASE
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OLD LINE BANCSHARES, INC.
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FOR IMMEDIATE RELEASE
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CONTACT: MARK SEMANIE
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July 30, 2013
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ACTING CHIEF FINANCIAL OFFICER
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(301) 430-2500
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OLD LINE BANCSHARES, INC. REPORTS STRONG ORGANIC GROWTH IN ADDITION TO THE ACQUISITION OF WSB HOLDINGS, INC. DURING THE SIX MONTHS ENDED JUNE 30, 2013
BOWIE, MD – Old Line Bancshares, Inc. (NASDAQ: OLBK), the parent company of Old Line Bank, reported that total assets and net loans both increased by 33.1% while deposits increased by 35.4% for the six months ended June 30, 2013. The increases were attributable to strong organic growth as well as the completion of the previously announced merger with WSB Holdings, Inc. (“WSB”). Net income decreased $2.1 million to a net loss of $84,285 for the three months ended June 30, 2013, compared to net income of $2.0 million for the three months ended June 30, 2012. Earnings were ($0.01) per basic and diluted common share for the three months ended June 30, 2013 and $0.30 and $0.29, respectively, per basic and diluted common share, for the same period in 2012. This decrease is primarily the result of $2.9 million of merger related expenses incurred during the second quarter of 2013. These merger related expenses were primarily related to legal fees, investment banking fees, severance and charges associated with the termination of WSB’s core data processing contract. Earnings were $1.2 million for the six months ended June 30, 2013, compared with $3.8 million for the same six month period last year. Earnings were $0.16 and $0.15, respectively, per basic and diluted common share compared to $0.55 per basic and diluted share for the same period last year. As with the three month period, the decrease is primarily the result of an increase in non-interest expenses including merger related costs that totaled $3.0 million for the six month period as a result of merger with WSB.
HIGHLIGHTS:
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·
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The merger with WSB became effective May 10, 2013 causing total assets to grow to $1.1 billion at June 30, 2013 compared to $861.9 million at December 31, 2012
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·
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Net loss of $84,285, or $0.01 per basic share was recorded for the three month period ending June 30, 2013, compared to net income of $2.0 million or $.30 per basic share for the second quarter of 2012, representing a decrease of $2.1 million compared to the second quarter of 2012.
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·
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Net income was $1.2 million or $0.16 per basic share for the six months ended June 30, 2013 compared to $3.8 million, or $0.55 per basic share for the same period in 2012.
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Net loans increased by $196.8 million, or 33.1%, since December 31, 2012.
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Total deposits grew by $260.1 million, or 35.4%, since December 31, 2012.
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·
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The second quarter Return on Average Assets (ROAA) and Return on Average Equity (ROAE) were (0.03%) and (0.35%), respectively, compared to ROAA and ROAE of 0.99% and 12.27%, respectively, for the second quarter of 2012.
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·
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For the six months ended June 30, 2013, ROAA and ROAE were 0.26% and 2.89%, respectively, as compared to ROAA and ROAE of 0.93% and 11.59%, respectively, for the six months ended June 30, 2012.
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The net interest margin for the second quarter of 2013 was 4.28% compared to 4.84% for the same period in 2012.
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Non-performing assets increased to 1.92% of total assets at June 30, 2013 compared to 1.31% at June 30, 2012 and 1.12% at December 31, 2012.
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The significant increase in total loans for the six month period included $43.2 million, or 6.77% of organic growth and $153.5 million of loans acquired in the WSB transaction. Loan growth is comprised of an organic increase of $16.7 million, or 2.61% in the first quarter and $26.5 million, or 4.16% in the second quarter. Similarly, deposit growth was comprised of $37.2 million, or 4.81% of organic growth and $222.9 of deposits acquired in the WSB transaction. Deposits increased organically by $13.0 million, or 1.69% in the first quarter and $24.1 million or 3.12% in the second quarter.
“We continue to generate strong organic loan growth while maintaining above average margins. As a result of the merger with WSB, we incurred anticipated merger and acquisition expenses during the quarter which negatively impacted second quarter and year to date earnings,” stated James W. Cornelsen, President and Chief Executive Officer “With the dedication and teamwork of both organizations, the two core processing systems will be merged. We expect that project to be completed during the fourth quarter of 2013. We believe that Old Line Bank is well positioned to continue its profitable growth while also executing on our strategic initiatives to maximize shareholder value. We will maintain the WSB mortgage department which should enhance non-interest income. We also expect that the new Montgomery County, Maryland loan production office and the Old Line Financial Services team will increase interest and fee income in the future.”
The decrease in net income during the second quarter of 2013 compared to the second quarter of 2012 was primarily the result of a $4.3 million, or 68.58%, increase in total non-interest expense, which was partially offset by a $740,000 increase in net interest income and a $175,000 decrease in the provision for loan losses. The increase in non-interest expenses was mainly attributable to increases in merger and integration expenses as well as salaries and benefits, occupancy and equipment expenses and data processing expenses. As noted above, merger and integration expenses increased $2.9 million compared to the same period in 2012 as a result of the WSB transaction. Salaries and benefits increased by $1.1 million or 36.43%, when compared to the second quarter of 2012 primarily as a result of the acquisition of WSB. Occupancy and equipment expenses increased $300,000 or 32.85% compared to the same period in 2012 primarily due to the additional branches acquired in the acquisition of WSB. In addition, a decrease of $800,000 in the fair value accretion in the three month period ended June 30, 2013, to $300,000 compared to $1.1 million for the three month period ended June 30, 2012 contributed to the decrease in net income.
Non-performing assets to total assets increased to 1.92% at June 30, 2013 compared to 1.12% at December 31, 2012 and 1.31% at June 30, 2012. The increase in non-performing assets from the prior periods is primarily the result of acquiring $22 million of non-performing assets from WSB in the merger. The percentage of non-performing assets after the completion of the Maryland Bankcorp acquisition in 2011 was similarly high, at 1.89%, but decreased in the periods following such acquisition, and we expect a similar decrease following the recent acquisition of WSB as well. The allowance for loan losses as a percent of gross loans decreased to 0.53% as compared to 0.71% at June 30, 2012. The decrease in the allowance for loan losses as a percent of gross loans is primarily a result of the addition of the acquired loans which are recorded at estimated fair value on their purchase date with no carryover of the related allowance for loan and lease losses. The legacy loan portfolio’s asset quality remained strong during the quarter ended June 30, 2013. As a result, the provision expense was decreased for the second quarter of 2013 as compared to the same quarter in 2012. Based on internal analysis, the ratio of non-performing assets to total assets, and the satisfactory historical performance of the loan portfolio, management believes that the allowance continues to appropriately reflect the inherent risk of loss in the portfolio and the current economic climate regarding the loans acquired in an acquisition. However, should there be any evidence that there is deterioration in the loan portfolio the allowance will be adjusted accordingly through a charge to provision expense to increase the allowance.
As previously reported, the Company announced the merger with WSB became effective May 10, 2013. Until final conversion, it is anticipated that the Company will continue to incur merger related expenses that may cause earnings to be lower than would otherwise be expected. However, future merger related costs should be substantially lower than those incurred to date and it is anticipated the WSB merger will be accretive to earnings by the first quarter of 2014. This combination created a $1.1 billion banking institution and has allowed Old Line to expand its financial services with the addition of a successful and growing mortgage origination team. Old Line also anticipates that the acquisition and integration of WSB will enhance the liquidity of its stock as well as overall financial condition and operating performance.
Old Line Bancshares, Inc. is the parent company of Old Line Bank, a Maryland chartered commercial bank headquartered in Bowie, Maryland, approximately 10 miles east of Andrews Air Force Base and 20 miles east of Washington, D.C. Old Line Bank has 23 branches located in its primary market area of suburban Maryland (Washington, D.C. suburbs and Southern Maryland) counties of Anne Arundel, Calvert, Charles, Prince George's and St. Mary's. It also targets customers throughout the greater Washington, D.C. metropolitan area.
The statements in this press release that are not historical facts, in particular the statements with respect to the anticipated effects on us and our stock of our recent merger with WSB, including that the merger will be accretive to earnings by the first quarter of 2014 and anticipated merger costs going forward, anticipated decreases in our percentages of non-performing assets following the recent WSB acquisition, continued profitable growth, , increased interest and fee income and the adequacy of our loan loss allowance constitute “forward-looking statements” as defined by Federal securities laws. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. These statements can generally be identified by the use of forward-looking terminology such as “believes,” “expects,” “intends,” “may,” “will,” “should,” “anticipates”, “plans” or similar terminology. Actual results could differ materially from those currently anticipated due to a number of factors, including, but not limited to, that integrating WSB’s business into our own could take longer or be more difficult than anticipated, deterioration in economic conditions or a slower than anticipated recovery in our target markets or nationally, sustained high levels of or further increases in the unemployment rate in our target markets, the actions of our competitors and our ability to successfully compete, in particular in new market areas, and changes in laws impacting our ability to collect on outstanding loans or otherwise negatively impact our business, including regulations implemented pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act enacted in July 2010. Forward-looking statements speak only as of the date they are made. Old Line Bancshares, Inc. will not update forward-looking statements to reflect factual assumptions, circumstances or events that have changed after a forward-looking statement was made. For further information regarding risks and uncertainties that could affect forward-looking statements Old Line Bancshares, Inc. may make, please refer to the filings made by Old Line Bancshares, Inc. with the U.S. Securities and Exchange Commission available at www.sec.gov.
Old Line Bancshares, Inc. & Subsidiaries
Consolidated Balance Sheets
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June 30,
2013
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March 31,
2013
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December 31,
2012 (1)
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September 30,
2012
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June 30,
2012
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March 31,
2012
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||||||||||||||||||
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(Unaudited)
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(Unaudited)
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(Unaudited)
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(Unaudited)
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(Unaudited)
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||||||||||||||||||||
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Cash and due from banks
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$ | 50,689,336 | $ | 37,651,112 | $ | 28,332,456 | $ | 43,813,588 | $ | 37,533,354 | $ | 24,018,472 | ||||||||||||
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Interest bearing accounts
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30,352 | 30,291 | 130,192 | 26,137 | 122,824 | 1,020,231 | ||||||||||||||||||
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Federal funds sold
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3,017,257 | 331,153 | 228,113 | 908,495 | 508,150 | 1,094,891 | ||||||||||||||||||
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Total cash and cash equivalents
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53,736,945 | 38,012,556 | 28,690,761 | 44,748,220 | 38,164,328 | 26,133,594 | ||||||||||||||||||
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Investment securities available for sale
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184,190,791 | 154,081,188 | 171,541,222 | 180,363,532 | 168,502,783 | 163,204,721 | ||||||||||||||||||
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Loans, less allowance for loan losses
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791,936,893 | 611,850,594 | 595,144,928 | 573,147,401 | 573,146,131 | 552,843,016 | ||||||||||||||||||
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Equity securities at cost
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3,709,490 | 3,174,220 | 3,615,444 | 3,828,237 | 3,765,079 | 3,894,766 | ||||||||||||||||||
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Premises and equipment
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35,313,769 | 24,912,937 | 25,133,013 | 23,883,734 | 23,763,775 | 23,651,682 | ||||||||||||||||||
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Accrued interest receivable
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3,623,274 | 2,511,753 | 2,639,483 | 2,606,790 | 2,592,123 | 2,562,773 | ||||||||||||||||||
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Prepaid income taxes
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621,176 | - | - | - | - | 27,964 | ||||||||||||||||||
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Deferred income taxes
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23,111,238 | 8,015,351 | 7,139,545 | 6,791,483 | 7,346,728 | 7,307,974 | ||||||||||||||||||
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Bank owned life insurance
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30,135,483 | 16,977,347 | 16,869,307 | 16,757,707 | 16,644,925 | 16,530,205 | ||||||||||||||||||
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Prepaid pension
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- | - | - | 1,030,551 | 1,030,551 | 1,030,551 | ||||||||||||||||||
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Other real estate owned
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5,396,654 | 2,726,910 | 3,719,449 | 3,231,449 | 3,490,730 | 3,919,461 | ||||||||||||||||||
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Goodwill
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6,847,424 | 633,790 | 633,790 | 633,790 | 633,790 | 633,790 | ||||||||||||||||||
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Core deposit intangible
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5,749,737 | 3,513,889 | 3,691,471 | 3,869,054 | 4,046,636 | 4,224,218 | ||||||||||||||||||
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Other assets
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2,711,768 | 2,575,612 | 3,038,064 | 2,990,530 | 3,036,820 | 3,727,066 | ||||||||||||||||||
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Total assets
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$ | 1,147,084,642 | $ | 868,986,147 | $ | 861,856,477 | $ | 863,882,478 | $ | 846,164,399 | $ | 809,691,781 | ||||||||||||
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Deposits
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Non-interest bearing
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$ | 213,570,493 | $ | 188,172,189 | $ | 188,895,263 | $ | 185,347,907 | $ | 186,639,878 | $ | 169,180,497 | ||||||||||||
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Interest bearing
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781,968,601 | 560,330,114 | 546,562,555 | 545,730,571 | 532,956,475 | 517,467,161 | ||||||||||||||||||
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Total deposits
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995,539,094 | 748,502,303 | 735,457,818 | 731,078,478 | 719,596,353 | 686,647,658 | ||||||||||||||||||
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Short term borrowings
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28,818,101 | 31,510,107 | 37,905,467 | 44,544,608 | 41,955,385 | 40,505,782 | ||||||||||||||||||
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Long term borrowings
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6,142,962 | 6,166,788 | 6,192,350 | 6,216,463 | 6,239,129 | 6,261,429 | ||||||||||||||||||
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Accrued interest payable
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259,847 | 279,907 | 311,735 | 341,494 | 359,367 | 370,712 | ||||||||||||||||||
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Accrued pension
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4,768,470 | 4,690,584 | 4,615,699 | 4,570,725 | 4,480,261 | 4,411,462 | ||||||||||||||||||
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Other liabilities
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3,825,204 | 2,749,707 | 2,120,247 | 2,757,115 | 1,853,766 | 1,582,906 | ||||||||||||||||||
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Total liabilities
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1,039,353,678 | 793,899,396 | 786,603,316 | 789,508,883 | 774,484,261 | 739,779,949 | ||||||||||||||||||
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Stockholders' equity
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Common stock
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98,202 | 68,538 | 68,454 | 68,308 | 68,285 | 68,285 | ||||||||||||||||||
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Additional paid-in capital
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92,145,572 | 53,875,593 | 53,792,015 | 53,647,456 | 53,574,827 | 53,519,196 | ||||||||||||||||||
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Retained earnings
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19,066,586 | 19,543,682 | 18,531,387 | 17,087,831 | 15,332,768 | 13,576,596 | ||||||||||||||||||
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Accumulated other comprehensive loss
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(3,946,354 | ) | 1,220,486 | 2,469,758 | 3,171,006 | 2,284,600 | 2,311,030 | |||||||||||||||||
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Total Old Line Bancshares, Inc.
stockholders' equity
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107,364,006 | 74,708,299 | 74,861,614 | 73,974,601 | 71,260,480 | 69,475,107 | ||||||||||||||||||
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Non-controlling interest
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366,958 | 378,452 | 391,547 | 398,994 | 419,658 | 436,725 | ||||||||||||||||||
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Total stockholders' equity
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107,730,964 | 75,086,751 | 75,253,161 | 74,373,595 | 71,680,138 | 69,911,832 | ||||||||||||||||||
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Total liabilities and
stockholders' equity
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$ | 1,147,084,642 | $ | 868,986,147 | $ | 861,856,477 | $ | 863,882,478 | $ | 846,164,399 | $ | 809,691,781 | ||||||||||||
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Shares of basic common stock outstanding
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9,820,217 | 6,853,814 | 6,845,432 | 6,830,832 | 6,828,452 | 6,828,452 | ||||||||||||||||||
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(1) Financial information as of December 31, 2012 has been derived from audited financial statements.
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Old Line Bancshares, Inc. & Subsidiaries
Consolidated Statements of Income
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Three Months
Ended
June 30,
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Three Months
Ended
March 31,
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Three Months
Ended
December 31,
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Three Months
Ended
September 30,
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Three Months
Ended
June 30,
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Six Months
Ended
June 30,
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Six Months
Ended
June 30,
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Three Months
Ended
March 31,
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2013
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2013
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2012 (1)
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2012
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2012
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2013
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2012
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2012
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|||||||||||||||||||||||||
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(Unaudited)
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(Unaudited)
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(Unaudited)
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(Unaudited)
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(Unaudited)
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(Unaudited)
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(Unaudited)
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Interest revenue
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Loans, including fees
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$ | 9,327,905 | $ | 7,831,823 | $ | 8,521,466 | $ | 8,702,142 | $ | 8,632,296 | $ | 17,159,728 | $ | 16,585,131 | $ | 7,952,835 | ||||||||||||||||
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Investment securities and other
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979,699 | 985,253 | 1,034,100 | 1,098,431 | 1,131,401 | 1,964,952 | 2,280,852 | 1,149,451 | ||||||||||||||||||||||||
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Total interest revenue
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10,307,604 | 8,817,076 | 9,555,566 | 9,800,573 | 9,763,697 | 19,124,680 | 18,865,983 | 9,102,286 | ||||||||||||||||||||||||
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Interest expense
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Deposits
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964,955 | 857,139 | 963,334 | 1,057,075 | 1,087,200 | 1,822,094 | 2,214,698 | 1,127,498 | ||||||||||||||||||||||||
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Borrowed funds
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139,472 | 112,487 | 190,310 | 206,721 | 213,111 | 251,959 | 425,487 | 212,376 | ||||||||||||||||||||||||
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Total interest expense
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1,104,427 | 969,626 | 1,153,644 | 1,263,796 | 1,300,311 | 2,074,053 | 2,640,185 | 1,339,874 | ||||||||||||||||||||||||
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Net interest income
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9,203,177 | 7,847,450 | 8,401,922 | 8,536,777 | 8,463,386 | 17,050,627 | 16,225,798 | 7,762,412 | ||||||||||||||||||||||||
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Provision for loan losses
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200,000 | 200,000 | 400,000 | 375,000 | 375,000 | 400,000 | 750,000 | 375,000 | ||||||||||||||||||||||||
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Net interest income after
provision for loan losses
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9,003,177 | 7,647,450 | 8,001,922 | 8,161,777 | 8,088,386 | 16,650,627 | 15,475,798 | 7,387,412 | ||||||||||||||||||||||||
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Non-interest revenue
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||||||||||||||||||||||||||||||||
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Service charges on
deposit accounts
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367,674 | 300,741 | 318,250 | 315,468 | 328,142 | 668,415 | 647,469 | 319,327 | ||||||||||||||||||||||||
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Gain on sales or calls
of investment securities
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9,659 | 631,429 | 307,242 | 289,511 | 282,858 | 641,088 | 560,028 | 277,170 | ||||||||||||||||||||||||
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Earnings on bank owned
life insurance
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200,641 | 133,228 | 136,171 | 137,082 | 138,496 | 333,869 | 275,201 | 136,705 | ||||||||||||||||||||||||
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Gains (losses) on sales
other real estate owned
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145,795 | (200,454 | ) | - | (48,509 | ) | 191,201 | (201,224 | ) | 159,213 | (31,988 | ) | ||||||||||||||||||||
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Losses on disposal of assets
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(19,078 | ) | (85,561 | ) | - | - | - | (104,639 | ) | - | - | |||||||||||||||||||||
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Gain on sale of loans
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146,565 | - | - | - | - | 146,565 | - | |||||||||||||||||||||||||
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Other fees and commissions
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301,268 | 247,683 | 182,450 | 146,550 | 215,089 | 695,516 | 392,688 | 177,599 | ||||||||||||||||||||||||
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Total non-interest revenue
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1,152,524 | 1,027,066 | 944,113 | 840,102 | 1,155,786 | 2,179,590 | 2,034,599 | 878,813 | ||||||||||||||||||||||||
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Non-interest expense
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Salaries & employee benefits
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4,126,567 | 3,232,677 | 3,188,366 | 3,016,334 | 3,024,815 | 7,359,245 | 5,833,809 | 2,808,994 | ||||||||||||||||||||||||
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Occupancy & Equipment
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1,214,947 | 1,068,867 | 931,197 | 933,775 | 914,576 | 2,283,815 | 1,822,447 | 907,871 | ||||||||||||||||||||||||
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Pension plan termination
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- | - | 700,884 | - | - | - | - | |||||||||||||||||||||||||
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Data processing
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329,878 | 239,057 | 238,830 | 214,187 | 192,232 | 568,934 | 416,967 | 224,735 | ||||||||||||||||||||||||
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Merger and integration
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2,786,350 | 240,485 | 363,375 | 49,290 | 29,166 | 3,026,835 | 58,333 | 29,167 | ||||||||||||||||||||||||
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Core deposit premium
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198,875 | 177,582 | 177,582 | 177,582 | 177,582 | 376,457 | 372,257 | 194,675 | ||||||||||||||||||||||||
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OREO expense
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154,908 | 314,165 | 124,167 | 39,092 | 320,795 | 469,073 | 813,183 | |||||||||||||||||||||||||
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Other operating
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1,723,373 | 1,606,608 | 1,531,026 | 1,651,498 | 1,590,002 | 3,329,981 | 2,618,345 | 1,520,731 | ||||||||||||||||||||||||
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Total non-interest expense
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10,534,898 | 6,879,441 | 7,255,427 | 6,081,758 | 6,249,168 | 17,414,340 | 11,935,341 | 5,686,173 | ||||||||||||||||||||||||
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Income (loss) before income taxes
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(379,197 | ) | 1,795,075 | 1,690,608 | 2,920,121 | 2,995,004 | 1,415,877 | 5,575,056 | 2,580,052 | |||||||||||||||||||||||
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Income tax (benefit) expense
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(283,417 | ) | 521,722 | (18,808 | ) | 912,490 | 982,759 | 238,305 | 1,826,764 | 844,005 | ||||||||||||||||||||||
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Net income (loss)
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(95,780 | ) | 1,273,353 | 1,709,416 | 2,007,631 | 2,012,245 | 1,177,572 | 3,748,292 | 1,736,047 | |||||||||||||||||||||||
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Less: Net income (loss)
attributable to the
noncontrolling interest
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(11,495 | ) | (13,095 | ) | (7,447 | ) | (20,664 | ) | (17,067 | ) | (24,590 | ) | (37,014 | ) | (19,947 | ) | ||||||||||||||||
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Net income (loss) available to
common stockholders
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$ | (84,285 | ) | $ | 1,286,448 | $ | 1,716,863 | $ | 2,028,295 | $ | 2,029,312 | $ | 1,202,162 | $ | 3,785,306 | $ | 1,755,994 | |||||||||||||||
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Earnings (loss) per basic share
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$ | (0.01 | ) | $ | 0.19 | $ | 0.25 | $ | 0.30 | $ | 0.30 | $ | 0.16 | $ | 0.55 | $ | 0.26 | |||||||||||||||
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Earnings (loss) per diluted share
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$ | (0.01 | ) | $ | 0.19 | $ | 0.25 | $ | 0.29 | $ | 0.29 | $ | 0.16 | $ | 0.55 | $ | 0.26 | |||||||||||||||
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Dividend per common share
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$ | 0.04 | $ | 0.04 | $ | 0.04 | $ | 0.04 | $ | 0.04 | $ | 0.08 | $ | 0.08 | $ | 0.04 | ||||||||||||||||
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Average number of basic shares
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8,505,016 | 6,848,505 | 6,834,665 | 6,829,785 | 6,828,452 | 7,681,337 | 6,824,673 | 6,820,894 | ||||||||||||||||||||||||
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Average number of dilutive shares
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8,609,164 | 6,950,749 | 6,929,296 | 6,909,147 | 6,905,041 | 7,585,449 | 6,871,727 | 6,855,568 | ||||||||||||||||||||||||
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(1) Financial information as of December 31, 2012 has been derived from audited financial statements.
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Old Line Bancshares, Inc. & Subsidiaries
Average Balances, Interest and Yields
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6/30/2013
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3/31/2013
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12/31/2012
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9/30/2012
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6/30/2012
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3/31/2012
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Average
Balance
|
Yield
|
Average
Balance
|
Yield
|
Average
Balance
|
Yield
|
Average
Balance
|
Yield
|
Average
Balance
|
Yield
|
Average
Balance
|
Yield
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Assets:
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Int. Bearing Deposits
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$ | 6,978,382 | 0.11% | $ | 1,870,920 | 0.15% | $ | 10,506,932 | 0.20% | $ | 9,609,610 | 0.21% | $ | 8,718,890 | 0.21% | $ | 5,240,111 | 0.16% | ||||||||||||||||||||||||||||||
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Investment Securities
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180,559,860 | 2.81% | 168,672,425 | 3.06% | 177,162,367 | 2.88% | 171,086,288 | 3.11% | 165,770,050 | 3.28% | 163,199,617 | 3.26% | ||||||||||||||||||||||||||||||||||||
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Loans
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721,222,893 | 5.28% | 605,701,991 | 5.35% | 587,421,759 | 5.86% | 576,428,450 | 6.11% | 558,859,415 | 6.27% | 549,594,392 | 5.87% | ||||||||||||||||||||||||||||||||||||
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Allowance for Loan Losses
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(4,164,025) | (4,058,816) | (4,186,009) | (4,266,214) | (3,966,131) | (3,825,189) | ||||||||||||||||||||||||||||||||||||||||||
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Total Loans
Net of allowance
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717,058,868 | 5.31% | 601,643,175 | 5.39% | 583,235,750 | 5.90% | 572,162,236 | 6.16% | 554,893,284 | 6.32% | 545,769,203 | 5.94% | ||||||||||||||||||||||||||||||||||||
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Total interest-earning assets
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904,597,110 | 4.77% | 772,186,520 | 4.87% | 770,905,049 | 5.15% | 752,858,134 | 5.39% | 729,382,224 | 5.56% | 714,208,931 | 5.26% | ||||||||||||||||||||||||||||||||||||
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Noninterest bearing cash
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45,762,911 | 25,465,996 | 30,544,104 | 50,174,932 | 34,172,441 | 27,694,416 | ||||||||||||||||||||||||||||||||||||||||||
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Other Assets
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85,200,150 | 62,206,398 | 61,756,948 | 61,911,524 | 62,310,069 | 62,002,664 | ||||||||||||||||||||||||||||||||||||||||||
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Total Assets
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$ | 1,035,560,171 | $ | 859,858,914 | $ | 863,206,101 | $ | 864,944,590 | $ | 825,864,734 | $ | 803,906,011 | ||||||||||||||||||||||||||||||||||||
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Liabilities and Stockholders' Equity
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Interest-bearing Deposits
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$ | 686,544,106 | 0.56% | $ | 552,649,682 | 0.63% | $ | 551,598,937 | 0.69% | $ | 553,524,257 | 0.76% | $ | 524,538,999 | 0.83% | $ | 521,623,877 | 0.87% | ||||||||||||||||||||||||||||||
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Borrowed Funds
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41,494,215 | 1.35% | 40,335,859 | 1.13% | 35,952,280 | 2.10% | 49,608,300 | 1.66% | 46,432,730 | 1.85% | 45,823,568 | 1.86% | ||||||||||||||||||||||||||||||||||||
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Total interest-bearing
liabilities
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728,038,321 | 0.61% | 592,985,541 | 0.66% | 587,551,217 | 0.78% | 603,132,557 | 0.83% | 570,971,729 | 0.92% | 567,447,445 | 0.95% | ||||||||||||||||||||||||||||||||||||
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Noninterest bearing deposits
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205,050,472 | 187,697,564 | 197,676,047 | 186,319,471 | 181,789,188 | 164,540,014 | ||||||||||||||||||||||||||||||||||||||||||
| 933,088,793 | 780,683,105 | 785,227,264 | 789,452,028 | 752,760,917 | 731,987,459 | |||||||||||||||||||||||||||||||||||||||||||
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Other Liabilities
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6,624,502 | 6,909,547 | 7,600,642 | 6,898,432 | 6,172,023 | 6,631,135 | ||||||||||||||||||||||||||||||||||||||||||
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Noncontrolling Interest
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369,671 | 387,467 | 392,942 | 406,102 | 423,568 | 443,876 | ||||||||||||||||||||||||||||||||||||||||||
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Stockholder's Equity
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95,477,205 | 71,878,795 | 69,985,253 | 68,188,028 | 66,508,226 | 64,843,541 | ||||||||||||||||||||||||||||||||||||||||||
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Total Liabilities and
Stockholder's Equity
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$ | 1,035,560,171 | $ | 859,858,914 | $ | 863,206,101 | $ | 864,944,590 | $ | 825,864,734 | $ | 803,906,011 | ||||||||||||||||||||||||||||||||||||
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Net interest spread
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4.16% | 4.21% | 4.37% | 4.56% | 4.64% | 4.31% | ||||||||||||||||||||||||||||||||||||||||||
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Net interest income and
Net interest margin(1)
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$ | 9,657,000 | 4.28% | $ | 8,299,213 | 4.36% | $ | 8,818,546 | 4.55% | $ | 8,932,729 | 4.72% | $ | 8,775,024 | 4.84% | $ | 8,003,071 | 4.51% | ||||||||||||||||||||||||||||||
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(1)
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Interest revenue is presented on a fully taxable equivalent (FTE) basis. The FTE basis adjusts for the tax favored status of these types of assets. Management believes providing this information on a FTE basis provides investors with a more accurate picture of our net interest spread and net interest income and we believe it to be the preferred industry measurement of these calculations. See “Reconciliation of Non-GAAP Measures.”
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(2)
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Available for sale investment securities are presented at amortized cost.
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The accretion of the fair value adjustments positively impacted the yield on loans and increased the net interest margin as follows:
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6/30/2013
|
3/31/2013
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12/31/2012
|
9/30/2012
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6/30/2012
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3/31/2012
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Fair Value
Accretion
Dollars
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% Impact on
Net Interest
Margin
|
Fair Value
Accretion
Dollars
|
% Impact on
Net Interest
Margin
|
Fair Value
Accretion
Dollars
|
% Impact on
Net Interest
Margin
|
Fair Value
Accretion
Dollars
|
% Impact on
Net Interest
Margin
|
Fair Value
Accretion
Dollars
|
% Impact on
Net Interest
Margin
|
Fair Value
Accretion
Dollars
|
% Impact on
Net Interest
Margin
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Commercial loans (1)
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$ | 38,933 | 0.02 | % | $ | 209,144 | 0.11 | % | $ | 38,783 | 0.02 | % | $ | 64,142 | 0.03 | % | $ | 42,718 | 0.02 | % | $ | 41,752 | 0.02 | % | ||||||||||||||||||||||||
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Mortgage loans (1)
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173,261 | 0.08 | (4,500 | ) | (0.00 | ) | 819,028 | 0.42 | 776,089 | 0.41 | 1,007,812 | 0.56 | 423,275 | 0.24 | ||||||||||||||||||||||||||||||||||
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Consumer loans
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2,876 | 0.00 | 2,371 | 0.00 | 2,188 | 0.00 | 1,968 | 0.01 | 1,899 | 0.00 | 1,694 | 0.00 | ||||||||||||||||||||||||||||||||||||
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Interest bearing deposits
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85,046 | 0.04 | 33,461 | 0.02 | 33,379 | 0.02 | 33,847 | 0.01 | 57,081 | 0.03 | 64,813 | 0.04 | ||||||||||||||||||||||||||||||||||||
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Total Fair Value Accretion
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$ | 300,116 | 0.13 | % | $ | 240,476 | 0.13 | % | $ | 893,378 | 0.46 | % | $ | 876,046 | 0.46 | % | $ | 1,109,510 | 0.61 | % | $ | 531,534 | 0.30 | % | ||||||||||||||||||||||||
(1) Reclassification of a single loan from mortgage loans to commercial loans during the period caused the negative amortization in mortgage loans during the first quarter of 2013. The impact of this reclassification was immaterial in prior periods.
Below is a reconciliation of the fully tax equivalent adjustments and the GAAP basis information presented in this report:
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6/30/2013
|
3/31/2013
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12/31/2012
|
9/30/2012
|
6/30/2012
|
3/30/2012
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Net Interest
Income
|
Yield
|
Net Interest
Income
|
Yield
|
Net Interest
Income
|
Yield
|
Net Interest
Income
|
Yield
|
Net Interest
Income
|
Yield
|
Net Interest
Income
|
Yield
|
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GAAP net interest income
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$ | 9,203,177 | 4.08 | % | $ | 7,847,450 | 4.12 | % | $ | 8,401,922 | 4.34 | % | $ | 8,536,777 | 4.51 | % | $ | 8,463,386 | 4.67 | % | $ | 7,762,412 | 4.37 | % | ||||||||||||||||||||||||
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Tax equivalent adjustment
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Federal funds sold
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1 | 0.00 | 2 | 0.00 | 1 | 0.00 | - | - | 1 | 0.00 | - | - | ||||||||||||||||||||||||||||||||||||
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Investment securities
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285,049 | 0.13 | 287,612 | 0.15 | 258,483 | 0.13 | 241,934 | 0.13 | 224,794 | 0.12 | 174,470 | 0.10 | ||||||||||||||||||||||||||||||||||||
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Loans
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168,773 | 0.07 | 164,149 | 0.09 | 158,140 | 0.08 | 154,018 | 0.08 | 86,843 | 0.05 | 66,189 | 0.04 | ||||||||||||||||||||||||||||||||||||
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Total tax equivalent adjustment
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453,823 | 0.20 | 451,763 | 0.24 | 416,624 | 0.21 | 395,952 | 0.21 | 311,638 | 0.17 | 240,659 | 0.14 | ||||||||||||||||||||||||||||||||||||
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Tax equivalent interest yield
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$ | 9,657,000 | 4.28 | % | $ | 8,299,213 | 4.36 | % | $ | 8,818,546 | 4.55 | % | $ | 8,932,729 | 4.72 | % | $ | 8,775,024 | 4.84 | % | $ | 8,003,071 | 4.51 | % | ||||||||||||||||||||||||
Old Line Bancshares, Inc. & Subsidiaries
Selected Loan Information
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(Dollars in thousands)
|
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|
|
June 30,
2013
|
March 31,
2013
|
December 31,
2012
|
September 30,
2012
|
June 30,
2012
|
March 31,
2012
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Acquired Loans(1)
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Non-accrual(2)
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$ | 23,684 | $ | 4,064 | $ | 4,092 | $ | 5,079 | $ | 4,842 | $ | 4,860 | ||||||||||||
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Accruing 30-89 days past due
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4,434 | 802 | 602 | 24 | 726 | 2,652 | ||||||||||||||||||
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Accruing 90 or more days past due
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8 | - | 6 | 82 | 940 | 6 | ||||||||||||||||||
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Legacy Loans(3)
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Non-accrual
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$ | 1,889 | $ | 1,388 | $ | 1,818 | $ | 3,151 | $ | 1,787 | $ | 1,787 | ||||||||||||
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Accruing 30-89 days past due
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2,607 | 2,077 | 1,799 | 2,348 | 2,799 | 1,278 | ||||||||||||||||||
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Accruing 90 or more days past due
|
- | - | - | 2 | - | - | ||||||||||||||||||
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Allowance for loan losses as % of gross loans
|
0.53 | % | 0.66 | % | 0.66 | % | 0.78 | % | 0.71 | % | 0.68 | % | ||||||||||||
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Allowance for loan losses as % of legacy loans
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0.81 | % | 0.84 | % | 0.85 | % | 1.03 | % | 0.96 | % | 0.96 | % | ||||||||||||
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Total non-performing loans as a % of gross loans
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2.77 | % | 0.89 | % | 0.99 | % | 2.00 | % | 1.92 | % | 1.90 | % | ||||||||||||
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Total non-performing assets as a % of total assets
|
1.92 | % | 0.94 | % | 1.12 | % | 1.34 | % | 1.31 | % | 1.31 | % | ||||||||||||
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(1)
|
Acquired loans represent all loans acquired on April 1, 2011 from MB&T and on May 10, 2013 from WSB. We originally recorded these loans at fair value upon acquisition.
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(2)
|
These loans are loans that are considered non-accrual because they are not paying in conformance with the original contractual agreement. At acquisition, we recorded these loans at fair value. As provided for under ASC 310-30, we recognize interest income on these loans through the accretion of the difference between the carrying value of these loans and their expected cash flows.
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(3)
|
Legacy loans represent total loans excluding loans acquired on April 1, 2011 and May 10, 2013.
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