Attached files
| file | filename |
|---|---|
| 8-K - THE BANCORP, INC. FORM 8-K - Bancorp, Inc. | bancorp8k.htm |
Exhibit 99.1
The Bancorp, Inc. Reports Third Quarter 2017 Financial Results
Wilmington, DE – October 26, 2017 – The Bancorp, Inc. ("The Bancorp") (NASDAQ: TBBK), a financial holding company, today reported financial results for third quarter 2017.
Highlights
| · |
Net income of $7.3 million and earnings per diluted share of $0.13 for the quarter ended September 30, 2017.
|
| · |
Net interest income increased 19% to $27.9 million for the quarter ended September 30, 2017, compared to $23.5 million for the quarter ended September 30, 2016.
|
| · |
Non-interest income increased 46% to $29.0 million for the quarter ended September 30, 2017, compared to $19.9 million for the quarter ended September 30, 2016.
|
| · |
Net interest margin increased to 3.26% for the quarter ended September 30, 2017, compared to 2.69% for the quarter ended September 30, 2016.
|
| · |
Loans increased 15% to $1.37 billion at September 30, 2017, compared to $1.20 billion at September 30, 2016.
|
| · |
Security backed lines of credit ("SBLOC") increased 16% to $720.3 million at September 30, 2017, compared to $621.5 million at September 30, 2016.
|
| · |
Direct lease financing increased 11% to $369.1 million at September 30, 2017 compared to $332.6 million at September 30, 2016.
|
| · |
Small Business Administration ("SBA") loans increased 11% to $386.8 million at September 30, 2017, compared to $349.6 million at September 30, 2016.
|
| · |
The rate on average deposits and interest bearing liabilities of $3.73 billion in the third quarter of 2017 was 0.43% with a rate of 0.51% for $1.92 billion of average prepaid card deposits.
|
| · |
Assets held for sale from discontinued operations decreased 18% to $315.0 million at September 30, 2017, compared to $386.2 million at September 30, 2016.
|
| · |
Consolidated leverage ratio increased to 8.25% at September 30, 2017.
|
| · |
Book value per common share at September 30, 2017 was $6.09 per share. The Bancorp and its subsidiary, The Bancorp Bank, remain well capitalized.
|
Damian Kozlowski, The Bancorp's Chief Executive Officer, said, "Bancorp's third quarter 2017 performance was another positive step forward for our company. In the third quarter of 2017, The Bancorp earned $7.3 million in net income or 13 cents a share on approximately $57 million of total continuing operations net revenue. All of our businesses are improving, and the Bancorp was able to realize an approximate $11 million gain in the third quarter of 2017 from our floating rate commercial loan securitization business. Our run-rate earnings are improving as revenue continues to build across our businesses while tight expense management improves operating efficiency."
1
The Bancorp reported net income of $7.3 million, or $0.13 earnings per diluted share, for the quarter ended September 30, 2017, compared to a net loss of $25.6 million, or $0.54 loss per diluted share for the quarter ended September 30, 2016. Net income from continuing operations for the quarter ended September 30, 2017, was $6.8 million, or $0.12 earnings per diluted share, compared to a net loss of $1.5 million from continuing operations, or $0.03 loss per diluted share, for the quarter ended September 30, 2016. Income from continuing operations does not include any income which may result from the reinvestment of the proceeds from sales or repayment of the remaining assets in The Bancorp's discontinued operations. Tier one capital to assets, tier one capital to risk-weighted assets, total capital to risk-weighted assets and common equity-tier 1 ratios were 8.25%, 16.27%, 16.62% and 16.27% respectively, compared to well capitalized minimums of 5%, 8%, 10% and 6.5%, respectively. In the third quarter of 2017, we recognized $2.5 million of expense for a non-tax deductible civil money penalty in connection with an internal system programming glitch within one of the Bank's third party payment processors. As a result, a higher fee was assessed to consumers for certain point of sale transactions during the period from December 2010 to November 2014. Additionally, in the third quarter of 2017, we terminated a data processing contract which resulted in a $1.1 million pretax and $725,000 after tax charge. Adjusted operating earnings after consideration of these two items amounted to $10.5 million for the third quarter of 2017. The following is a reconciliation of net income available to common shareholders to adjusted operating earnings, a non-GAAP measure which reflects the financial impact of those two items:
|
Three months ended
|
||||
|
September 30, 2017
|
||||
|
(in thousands)
|
||||
|
Net income available to common shareholders
|
$
|
7,282
|
||
|
Adjustments:
|
||||
|
tax-effected:
|
||||
|
Civil money penalty *
|
2,500
|
|||
|
Termination of data processing contract
|
725
|
|||
|
Adjusted operating earnings (1)
|
$
|
10,507
|
||
|
* Civil money penalty may not be deductible for Federal income tax purposes
|
||||
| (1) |
As a supplement to GAAP, Bancorp has provided this non-GAAP performance measure. 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 net income calculated pursuant to GAAP.
|
Conference Call Webcast
You may access the LIVE webcast of The Bancorp's Quarterly Earnings Conference Call at 8:00 AM ET Friday, October 27, 2017 by clicking on the webcast link on Bancorp's homepage at www.thebancorp.com. Or, you may dial 844.775.2543, access code 95371306. You may listen to the replay of the webcast following the live call on The Bancorp's investor relations website or telephonically until Friday, November 3, 2017 by dialing 855.859.2056, access code 95371306.
About The Bancorp
The Bancorp, Inc. (NASDAQ: TBBK) is dedicated to serving the unique needs of non-bank financial service companies, ranging from entrepreneurial start-ups to those on the Fortune 500. The company's only subsidiary, The Bancorp Bank (Member FDIC, Equal Housing Lender), has been repeatedly recognized in the payments industry as the Top Issuer of Prepaid Cards (US), a top merchant sponsor bank and a top ACH originator. Specialized lending distinctions include National Preferred SBA Lender, a leading provider of securities-backed lines of credit, and one of the few bank-owned commercial leasing groups in the nation. For more information please visit www.thebancorp.com.
2
Forward-Looking Statements
Statements in this earnings release regarding Bancorp'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 Bancorp's filings with the SEC, including the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of those 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 press release. The Bancorp does not undertake to publicly revise or update forward-looking statements in this press release 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
3
|
The Bancorp, Inc.
|
||||||||||||||||
|
Financial highlights
|
||||||||||||||||
|
(unaudited)
|
||||||||||||||||
|
Three months ended
|
Nine months ended
|
|||||||||||||||
|
September 30,
|
September 30,
|
|||||||||||||||
|
Condensed income statement
|
2017
|
2016
|
2017
|
2016
|
||||||||||||
|
(dollars in thousands except per share data)
|
||||||||||||||||
|
Net interest income
|
$
|
27,901
|
$
|
23,542
|
$
|
79,993
|
$
|
64,988
|
||||||||
|
Provision for loan and lease losses
|
800
|
750
|
2,150
|
1,810
|
||||||||||||
|
Non-interest income
|
||||||||||||||||
|
Service fees on deposit accounts
|
1,700
|
1,510
|
4,895
|
3,335
|
||||||||||||
|
Card payment and ACH processing fees
|
1,564
|
1,459
|
4,596
|
4,183
|
||||||||||||
|
Prepaid card fees
|
12,491
|
12,249
|
39,272
|
39,333
|
||||||||||||
|
Gain on sale of loans
|
11,394
|
903
|
17,535
|
809
|
||||||||||||
|
Gain on sale of investment securities
|
506
|
981
|
1,595
|
3,131
|
||||||||||||
|
Change in value of investment in unconsolidated entity
|
(4
|
)
|
811
|
(20
|
)
|
(12,313
|
)
|
|||||||||
|
Leasing income
|
705
|
588
|
2,088
|
1,456
|
||||||||||||
|
Affinity fees
|
275
|
1,091
|
1,445
|
3,507
|
||||||||||||
|
Gain on sale of health savings accounts
|
-
|
-
|
2,538
|
-
|
||||||||||||
|
Loss from sale of European prepaid card operations
|
-
|
-
|
(3,437
|
)
|
-
|
|||||||||||
|
Other non-interest income
|
376
|
312
|
892
|
4,691
|
||||||||||||
|
Total non-interest income
|
29,007
|
19,904
|
71,399
|
48,132
|
||||||||||||
|
Non-interest expense
|
||||||||||||||||
|
Bank Secrecy Act and lookback consulting expenses
|
-
|
1,340
|
-
|
29,076
|
||||||||||||
|
One time fee to exit data processing contract
|
1,136
|
-
|
1,136
|
-
|
||||||||||||
|
Civil money penalty
|
2,500
|
-
|
2,500
|
-
|
||||||||||||
|
Other non-interest expense
|
40,246
|
42,831
|
115,392
|
127,369
|
||||||||||||
|
Total non-interest expense
|
43,882
|
44,171
|
119,028
|
156,445
|
||||||||||||
|
Income (loss) from continuing operations before income tax expense
|
12,226
|
(1,475
|
)
|
30,214
|
(45,135
|
)
|
||||||||||
|
Income tax expense (benefit)
|
5,455
|
55
|
(457
|
)
|
(15,324
|
)
|
||||||||||
|
Net income (loss) from continuing operations
|
6,771
|
(1,530
|
)
|
30,671
|
(29,811
|
)
|
||||||||||
|
Net income (loss) from discontinued operations, net of tax
|
511
|
(24,021
|
)
|
3,438
|
(37,909
|
)
|
||||||||||
|
Net income (loss) available to common shareholders
|
$
|
7,282
|
$
|
(25,551
|
)
|
$
|
34,109
|
$
|
(67,720
|
)
|
||||||
|
Net income (loss) per share from continuing operations - basic
|
$
|
0.12
|
$
|
(0.03
|
)
|
$
|
0.55
|
$
|
(0.73
|
)
|
||||||
|
Net income (loss) per share from discontinued operations - basic
|
$
|
0.01
|
$
|
(0.51
|
)
|
$
|
0.06
|
$
|
(0.92
|
)
|
||||||
|
Net income (loss) per share - basic
|
$
|
0.13
|
$
|
(0.54
|
)
|
$
|
0.61
|
$
|
(1.65
|
)
|
||||||
|
Net income (loss) per share from continuing operations - diluted
|
$
|
0.12
|
$
|
(0.03
|
)
|
$
|
0.55
|
$
|
(0.73
|
)
|
||||||
|
Net income (loss) per share from discontinued operations - diluted
|
$
|
0.01
|
$
|
(0.51
|
)
|
$
|
0.06
|
$
|
(0.92
|
)
|
||||||
|
Net income (loss) per share - diluted
|
$
|
0.13
|
$
|
(0.54
|
)
|
$
|
0.61
|
$
|
(1.65
|
)
|
||||||
|
Weighted average shares - basic
|
55,758,433
|
47,153,658
|
55,661,538
|
40,957,247
|
||||||||||||
|
Weighted average shares - diluted
|
56,312,838
|
47,153,658
|
56,043,909
|
40,957,247
|
||||||||||||
|
For loss periods the weighted averages shares - basic is used in both the basic and diluted computations.
|
||||||||||||||||
4
|
Balance sheet
|
September 30,
|
June 30,
|
December 31,
|
September 30,
|
||||||||||||
|
2017
|
2017
|
2016
|
2016
|
|||||||||||||
|
(dollars in thousands)
|
||||||||||||||||
|
Assets:
|
||||||||||||||||
|
Cash and cash equivalents
|
||||||||||||||||
|
Cash and due from banks
|
$
|
5,813
|
$
|
6,458
|
$
|
4,127
|
$
|
4,061
|
||||||||
|
Interest earning deposits at Federal Reserve Bank
|
328,023
|
475,387
|
955,733
|
312,605
|
||||||||||||
|
Securities sold under agreements to resell
|
65,095
|
65,076
|
39,199
|
39,463
|
||||||||||||
|
Total cash and cash equivalents
|
398,931
|
546,921
|
999,059
|
356,129
|
||||||||||||
|
Investment securities, available-for-sale, at fair value
|
1,196,956
|
1,149,116
|
1,248,614
|
1,334,927
|
||||||||||||
|
Investment securities, held-to-maturity
|
86,402
|
93,419
|
93,467
|
93,495
|
||||||||||||
|
Loans held for sale, at fair value
|
380,272
|
542,819
|
663,140
|
562,957
|
||||||||||||
|
Loans, net of deferred fees and costs
|
1,374,060
|
1,370,263
|
1,222,911
|
1,198,237
|
||||||||||||
|
Allowance for loan and lease losses
|
(7,283
|
)
|
(7,353
|
)
|
(6,332
|
)
|
(6,058
|
)
|
||||||||
|
Loans, net
|
1,366,777
|
1,362,910
|
1,216,579
|
1,192,179
|
||||||||||||
|
Federal Home Loan Bank & Atlantic Community Bancshares stock
|
991
|
6,211
|
1,613
|
11,014
|
||||||||||||
|
Premises and equipment, net
|
21,087
|
22,004
|
24,125
|
21,797
|
||||||||||||
|
Accrued interest receivable
|
10,131
|
10,880
|
10,589
|
10,496
|
||||||||||||
|
Intangible assets, net
|
5,185
|
5,515
|
6,906
|
5,682
|
||||||||||||
|
Other real estate owned
|
-
|
-
|
104
|
-
|
||||||||||||
|
Deferred tax asset, net
|
53,017
|
53,226
|
55,666
|
29,765
|
||||||||||||
|
Investment in unconsolidated entity
|
107,711
|
120,862
|
126,930
|
157,396
|
||||||||||||
|
Assets held for sale from discontinued operations
|
314,994
|
336,246
|
360,711
|
386,155
|
||||||||||||
|
Other assets
|
51,164
|
53,888
|
50,611
|
55,519
|
||||||||||||
|
Total assets
|
$
|
3,993,618
|
$
|
4,304,017
|
$
|
4,858,114
|
$
|
4,217,511
|
||||||||
|
Liabilities:
|
||||||||||||||||
|
Deposits
|
||||||||||||||||
|
Demand and interest checking
|
$
|
3,113,212
|
$
|
3,437,482
|
$
|
3,816,524
|
$
|
3,364,103
|
||||||||
|
Savings and money market
|
452,183
|
438,602
|
421,780
|
402,832
|
||||||||||||
|
Total deposits
|
3,565,395
|
3,876,084
|
4,238,304
|
3,766,935
|
||||||||||||
|
Securities sold under agreements to repurchase
|
180
|
273
|
274
|
353
|
||||||||||||
|
Short-term borrowings
|
-
|
-
|
-
|
70,000
|
||||||||||||
|
Subordinated debenture
|
13,401
|
13,401
|
13,401
|
13,401
|
||||||||||||
|
Long-term borrowings
|
42,482
|
42,680
|
263,099
|
-
|
||||||||||||
|
Other liabilities
|
32,699
|
40,560
|
44,073
|
27,744
|
||||||||||||
|
Total liabilities
|
$
|
3,654,157
|
$
|
3,972,998
|
$
|
4,559,151
|
$
|
3,878,433
|
||||||||
|
Shareholders' equity:
|
||||||||||||||||
|
Common stock - authorized, 75,000,000 shares of $1.00 par value; 55,859,660 and 55,419,119 shares issued at September 30, 2017 and 2016, respectively
|
55,860
|
55,858
|
55,419
|
55,419
|
||||||||||||
|
Treasury stock (100,000 shares)
|
(866
|
)
|
(866
|
)
|
(866
|
)
|
(866
|
)
|
||||||||
|
Additional paid-in capital
|
362,340
|
361,478
|
360,564
|
359,793
|
||||||||||||
|
Accumulated deficit
|
(77,850
|
)
|
(85,114
|
)
|
(111,941
|
)
|
(83,169
|
)
|
||||||||
|
Accumulated other comprehensive income (loss)
|
(23
|
)
|
(337
|
)
|
(4,213
|
)
|
7,901
|
|||||||||
|
Total shareholders' equity
|
339,461
|
331,019
|
298,963
|
339,078
|
||||||||||||
|
Total liabilities and shareholders' equity
|
$
|
3,993,618
|
$
|
4,304,017
|
$
|
4,858,114
|
$
|
4,217,511
|
||||||||
5
|
Average balance sheet and net interest income
|
Three months ended September 30, 2017
|
Three months ended September 30, 2016
|
||||||||||||||||||||||
|
(dollars in thousands)
|
||||||||||||||||||||||||
|
Average
|
Average
|
Average
|
Average
|
|||||||||||||||||||||
|
Assets:
|
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
||||||||||||||||||
|
Interest-earning assets:
|
||||||||||||||||||||||||
|
Loans net of unearned fees and costs **
|
$
|
1,816,751
|
$
|
21,147
|
4.66
|
%
|
$
|
1,661,807
|
$
|
17,425
|
4.19
|
%
|
||||||||||||
|
Leases - bank qualified*
|
20,787
|
419
|
8.06
|
%
|
21,006
|
418
|
7.96
|
%
|
||||||||||||||||
|
Investment securities-taxable
|
1,235,615
|
8,847
|
2.86
|
%
|
1,373,776
|
8,350
|
2.43
|
%
|
||||||||||||||||
|
Investment securities-nontaxable*
|
13,238
|
133
|
4.02
|
%
|
48,683
|
218
|
1.79
|
%
|
||||||||||||||||
|
Interest earning deposits at Federal Reserve Bank
|
366,724
|
1,190
|
1.30
|
%
|
324,179
|
397
|
0.49
|
%
|
||||||||||||||||
|
Federal funds sold and securities purchased under agreement to resell
|
65,008
|
371
|
2.28
|
%
|
39,392
|
146
|
1.48
|
%
|
||||||||||||||||
|
Net interest earning assets
|
3,518,123
|
32,107
|
3.65
|
%
|
3,468,843
|
26,954
|
3.11
|
%
|
||||||||||||||||
|
Allowance for loan and lease losses
|
(6,961
|
)
|
(5,267
|
)
|
||||||||||||||||||||
|
Assets held for sale from discontinued operations
|
325,912
|
3,098
|
3.80
|
%
|
459,400
|
3,891
|
3.39
|
%
|
||||||||||||||||
|
Other assets
|
235,070
|
246,171
|
||||||||||||||||||||||
|
$
|
4,072,144
|
$
|
4,169,147
|
|||||||||||||||||||||
|
Liabilities and Shareholders' Equity:
|
||||||||||||||||||||||||
|
Deposits:
|
||||||||||||||||||||||||
|
Demand and interest checking
|
$
|
3,224,167
|
$
|
3,136
|
0.39
|
%
|
$
|
3,249,801
|
$
|
2,379
|
0.29
|
%
|
||||||||||||
|
Savings and money market
|
439,688
|
552
|
0.50
|
%
|
392,045
|
423
|
0.43
|
%
|
||||||||||||||||
|
Time
|
-
|
-
|
0.00
|
%
|
76,931
|
104
|
0.54
|
%
|
||||||||||||||||
|
Total deposits
|
3,663,855
|
3,688
|
0.40
|
%
|
3,718,777
|
2,906
|
0.31
|
%
|
||||||||||||||||
|
Short-term borrowings
|
51,413
|
175
|
1.36
|
%
|
102,243
|
153
|
0.60
|
%
|
||||||||||||||||
|
Repurchase agreements
|
189
|
-
|
0.00
|
%
|
376
|
-
|
0.00
|
%
|
||||||||||||||||
|
Subordinated debt
|
13,401
|
150
|
4.48
|
%
|
13,401
|
131
|
3.91
|
%
|
||||||||||||||||
|
Total deposits and interest bearing liabilities
|
3,728,858
|
4,013
|
0.43
|
%
|
3,834,797
|
3,190
|
0.33
|
%
|
||||||||||||||||
|
Other liabilities
|
8,046
|
19,670
|
||||||||||||||||||||||
|
Total liabilities
|
3,736,904
|
3,854,467
|
||||||||||||||||||||||
|
Shareholders' equity
|
335,240
|
314,680
|
||||||||||||||||||||||
|
$
|
4,072,144
|
$
|
4,169,147
|
|||||||||||||||||||||
|
Net interest income on tax equivalent basis*
|
$
|
31,192
|
$
|
27,655
|
||||||||||||||||||||
|
Tax equivalent adjustment
|
193
|
222
|
||||||||||||||||||||||
|
Net interest income
|
$
|
30,999
|
$
|
27,433
|
||||||||||||||||||||
|
Net interest margin *
|
3.26
|
%
|
2.69
|
%
|
||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
* Full taxable equivalent basis, using a 35% statutory tax rate.
|
||||||||||||||||||||||||
|
** Includes loans held for sale.
|
||||||||||||||||||||||||
6
|
Average balance sheet and net interest income
|
Nine months ended September 30, 2017
|
Nine months ended September 30, 2016
|
||||||||||||||||||||||
|
(dollars in thousands)
|
||||||||||||||||||||||||
|
Average
|
Average
|
Average
|
Average
|
|||||||||||||||||||||
|
Assets:
|
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
||||||||||||||||||
|
Interest-earning assets:
|
||||||||||||||||||||||||
|
Loans net of unearned fees and costs **
|
$
|
1,740,655
|
$
|
58,266
|
4.46
|
%
|
$
|
1,543,448
|
$
|
48,061
|
4.15
|
%
|
||||||||||||
|
Leases - bank qualified*
|
21,167
|
1,231
|
7.75
|
%
|
20,618
|
1,334
|
8.63
|
%
|
||||||||||||||||
|
Investment securities-taxable
|
1,269,922
|
26,990
|
2.83
|
%
|
1,280,692
|
22,782
|
2.37
|
%
|
||||||||||||||||
|
Investment securities-nontaxable*
|
14,423
|
351
|
3.24
|
%
|
59,892
|
983
|
2.19
|
%
|
||||||||||||||||
|
Interest earning deposits at Federal Reserve Bank
|
532,223
|
3,961
|
0.99
|
%
|
490,037
|
1,677
|
0.46
|
%
|
||||||||||||||||
|
Federal funds sold and securities purchased under agreement to resell
|
60,119
|
931
|
2.06
|
%
|
27,414
|
301
|
1.46
|
%
|
||||||||||||||||
|
Net interest-earning assets
|
3,638,509
|
91,730
|
3.36
|
%
|
3,422,101
|
75,138
|
2.93
|
%
|
||||||||||||||||
|
Allowance for loan and lease losses
|
(6,793
|
)
|
(4,538
|
)
|
||||||||||||||||||||
|
Assets held for sale
|
337,102
|
9,594
|
3.79
|
%
|
528,168
|
15,037
|
3.80
|
%
|
||||||||||||||||
|
Other assets
|
251,629
|
283,171
|
||||||||||||||||||||||
|
$
|
4,220,447
|
$
|
4,228,902
|
|||||||||||||||||||||
|
Liabilities and Shareholders' Equity:
|
||||||||||||||||||||||||
|
Deposits:
|
||||||||||||||||||||||||
|
Demand and interest checking
|
$
|
3,433,027
|
$
|
8,836
|
0.34
|
%
|
$
|
3,325,047
|
$
|
7,217
|
0.29
|
%
|
||||||||||||
|
Savings and money market
|
434,768
|
1,718
|
0.53
|
%
|
390,202
|
1,028
|
0.35
|
%
|
||||||||||||||||
|
Time
|
-
|
-
|
0.00
|
%
|
103,624
|
447
|
0.58
|
%
|
||||||||||||||||
|
Total deposits
|
3,867,795
|
10,554
|
0.36
|
%
|
3,818,873
|
8,692
|
0.30
|
%
|
||||||||||||||||
|
Short-term borrowings
|
19,498
|
197
|
1.35
|
%
|
58,056
|
263
|
0.60
|
%
|
||||||||||||||||
|
Repurchase agreements
|
245
|
-
|
0.00
|
%
|
812
|
1
|
0.16
|
%
|
||||||||||||||||
|
Subordinated debt
|
13,401
|
432
|
4.30
|
%
|
13,401
|
383
|
3.81
|
%
|
||||||||||||||||
|
Total deposits and interest bearing liabilities
|
3,900,939
|
11,183
|
0.38
|
%
|
3,891,142
|
9,339
|
0.32
|
%
|
||||||||||||||||
|
Other liabilities
|
431
|
21,306
|
||||||||||||||||||||||
|
Total liabilities
|
3,901,370
|
3,912,448
|
||||||||||||||||||||||
|
Shareholders' equity
|
319,077
|
316,454
|
||||||||||||||||||||||
|
$
|
4,220,447
|
$
|
4,228,902
|
|||||||||||||||||||||
|
Net interest income on tax equivalent basis*
|
$
|
$ 90,141
|
$
|
$ 80,836
|
||||||||||||||||||||
|
Tax equivalent adjustment
|
554
|
811
|
||||||||||||||||||||||
|
Net interest income
|
$
|
89,587
|
$
|
80,025
|
||||||||||||||||||||
|
Net interest margin *
|
3.02
|
%
|
2.57
|
%
|
||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
* Full taxable equivalent basis, using a 35% statutory tax rate.
|
||||||||||||||||||||||||
|
** Includes loans held for sale.
|
||||||||||||||||||||||||
7
|
Allowance for loan and lease losses:
|
Nine months ended
|
Year ended
|
||||||||||||||
|
September 30,
|
September 30,
|
December 31,
|
||||||||||||||
|
2017
|
2016
|
2016
|
||||||||||||||
|
(dollars in thousands)
|
||||||||||||||||
|
Balance in the allowance for loan and lease losses at beginning of period (1)
|
$
|
6,332
|
$
|
4,400
|
$
|
4,400
|
||||||||||
|
Loans charged-off:
|
||||||||||||||||
|
SBA non real estate
|
344
|
-
|
128
|
|||||||||||||
|
SBA commercial mortgage
|
-
|
76
|
-
|
|||||||||||||
|
Direct lease financing
|
779
|
63
|
119
|
|||||||||||||
|
Other consumer loans
|
113
|
39
|
1,211
|
|||||||||||||
|
Total
|
1,236
|
178
|
1,458
|
|||||||||||||
|
Recoveries:
|
||||||||||||||||
|
SBA non real estate
|
12
|
1
|
1
|
|||||||||||||
|
Direct lease financing
|
-
|
17
|
17
|
|||||||||||||
|
Other consumer loans
|
25
|
8
|
12
|
|||||||||||||
|
Total
|
37
|
26
|
30
|
|||||||||||||
|
Net charge-offs
|
1,199
|
152
|
1,428
|
|||||||||||||
|
Provision charged to operations
|
2,150
|
1,810
|
3,360
|
|||||||||||||
|
Balance in allowance for loan and lease losses at end of period
|
$
|
7,283
|
$
|
6,058
|
$
|
6,332
|
||||||||||
|
Net charge-offs/average loans
|
0.07
|
%
|
0.01
|
%
|
0.09
|
%
|
||||||||||
|
Net charge-offs/average loans (annualized)
|
0.09
|
%
|
0.01
|
%
|
0.09
|
%
|
||||||||||
|
Net charge-offs/average assets
|
0.03
|
%
|
0.00
|
%
|
0.03
|
%
|
||||||||||
|
(1) Excludes activity from assets held for sale.
|
||||||||||||||||
|
Loan portfolio:
|
September 30,
|
June 30,
|
December 31,
|
September 30,
|
||||||||||||
|
2017
|
2017
|
2016
|
2016
|
|||||||||||||
|
(dollars in thousands)
|
||||||||||||||||
|
SBA non real estate
|
$
|
72,055
|
$
|
74,511
|
$
|
74,644
|
$
|
74,262
|
||||||||
|
SBA commercial mortgage
|
132,997
|
126,224
|
126,159
|
117,053
|
||||||||||||
|
SBA construction
|
14,205
|
11,057
|
8,826
|
6,317
|
||||||||||||
|
Total SBA loans
|
219,257
|
211,792
|
209,629
|
197,632
|
||||||||||||
|
Direct lease financing
|
369,069
|
371,002
|
346,645
|
332,632
|
||||||||||||
|
SBLOC
|
720,279
|
718,707
|
630,400
|
621,456
|
||||||||||||
|
Other specialty lending
|
36,664
|
44,389
|
11,073
|
20,076
|
||||||||||||
|
Other consumer loans
|
20,107
|
15,858
|
17,374
|
19,375
|
||||||||||||
|
1,365,376
|
1,361,748
|
1,215,121
|
1,191,171
|
|||||||||||||
|
Unamortized loan fees and costs
|
8,684
|
8,515
|
7,790
|
7,066
|
||||||||||||
|
Total loans, net of deferred loan fees and costs
|
$
|
1,374,060
|
$
|
1,370,263
|
$
|
1,222,911
|
$
|
1,198,237
|
||||||||
|
Small business lending portfolio:
|
September 30,
|
June 30,
|
December 31,
|
September 30,
|
||||||||||||
|
2017
|
2017
|
2016
|
2016
|
|||||||||||||
|
(dollars in thousands)
|
||||||||||||||||
|
SBA loans, including deferred fees and costs
|
225,909
|
218,391
|
215,786
|
203,196
|
||||||||||||
|
SBA loans included in HFS
|
160,855
|
158,252
|
154,016
|
146,450
|
||||||||||||
|
Total SBA loans
|
$
|
386,764
|
$
|
376,642
|
$
|
369,802
|
$
|
349,646
|
||||||||
8
|
Capital ratios:
|
Tier 1 capital
|
Tier 1 capital
|
Total capital
|
Common equity
|
||||||||||||
|
to average
|
to risk-weighted
|
to risk-weighted
|
tier 1 to risk
|
|||||||||||||
|
assets ratio
|
assets ratio
|
assets ratio
|
weighted assets
|
|||||||||||||
|
As of September 30, 2017
|
||||||||||||||||
|
The Bancorp, Inc.
|
8.25
|
%
|
16.27
|
%
|
16.62
|
%
|
16.27
|
%
|
||||||||
|
The Bancorp Bank
|
8.04
|
%
|
15.95
|
%
|
16.30
|
%
|
15.95
|
%
|
||||||||
|
"Well capitalized" institution (under FDIC regulations)
|
5.00
|
%
|
8.00
|
%
|
10.00
|
%
|
6.50
|
%
|
||||||||
|
As of December 31, 2016
|
||||||||||||||||
|
The Bancorp, Inc.
|
6.90
|
%
|
13.34
|
%
|
13.63
|
%
|
13.34
|
%
|
||||||||
|
The Bancorp Bank
|
6.84
|
%
|
13.24
|
%
|
13.53
|
%
|
13.24
|
%
|
||||||||
|
"Well capitalized" institution (under FDIC regulations)
|
5.00
|
%
|
8.00
|
%
|
10.00
|
%
|
6.50
|
%
|
||||||||
|
Three months ended
|
Nine months ended
|
||||||||||||||||
|
September 30,
|
September 30,
|
||||||||||||||||
|
2017
|
2016
|
2017
|
2016
|
||||||||||||||
|
Selected operating ratios:
|
|||||||||||||||||
|
Return on average assets (annualized)
|
0.71
|
%
|
nm
|
1.08
|
%
|
nm
|
|||||||||||
|
Return on average equity (annualized)
|
8.62
|
%
|
nm
|
14.29
|
%
|
nm
|
|||||||||||
|
Net interest margin
|
3.26
|
%
|
2.69
|
%
|
3.02
|
%
|
2.57
|
%
|
|||||||||
|
Book value per share
|
$
|
6.09
|
$
|
6.13
|
$
|
6.09
|
$
|
6.13
|
|||||||||
|
September 30,
|
June 30,
|
December 31,
|
September 30,
|
||||||||||||||
|
2017
|
2017
|
2016
|
2016
|
||||||||||||||
|
Asset quality ratios:
|
|||||||||||||||||
|
Nonperforming loans to total loans (1)
|
0.39
|
%
|
0.41
|
%
|
0.30
|
%
|
0.58
|
%
|
|||||||||
|
Nonperforming assets to total assets (1)
|
0.13
|
%
|
0.13
|
%
|
0.08
|
%
|
0.16
|
%
|
|||||||||
|
Allowance for loan and lease losses to total loans
|
0.53
|
%
|
0.54
|
%
|
0.52
|
%
|
0.51
|
%
|
|||||||||
|
Nonaccrual loans
|
$
|
4,953
|
$
|
5,115
|
$
|
2,972
|
$
|
4,021
|
|||||||||
|
Other real estate owned
|
-
|
104
|
104
|
-
|
|||||||||||||
|
Total nonperforming assets
|
$
|
4,953
|
$
|
5,219
|
$
|
3,076
|
$
|
4,021
|
|||||||||
|
Loans 90 days past due still accruing interest
|
$
|
354
|
$
|
494
|
$
|
661
|
$
|
2,933
|
|||||||||
|
(1) Nonperforming loan and asset ratios include nonaccrual loans and loans 90 days past due still accruing interest.
|
|||||||||||||||||
|
Three months ended
|
|||||||||||||||||
|
September 30,
|
June 30,
|
December 31,
|
September 30,
|
||||||||||||||
|
2017
|
2017
|
2016
|
2016
|
||||||||||||||
|
(in thousands)
|
|||||||||||||||||
|
Gross dollar volume (GDV) (1):
|
|||||||||||||||||
|
Prepaid card GDV
|
$
|
10,970,085
|
$
|
11,894,601
|
$
|
10,647,520
|
$
|
10,459,097
|
|||||||||
|
(1) Gross dollar volume represents the total dollar amount spent on prepaid and debit cards issued by The Bancorp.
|
|||||||||||||||||
9
|
Analysis of Walnut Street marks:
|
||||||||
|
Loan activity
|
Marks
|
|||||||
|
(dollars in millions)
|
||||||||
|
Original Walnut Street loan balance, December 31, 2014
|
$
|
267
|
||||||
|
Marks through December 31, 2014 sale date
|
(58
|
)
|
$
|
(58
|
)
|
|||
|
Sales price of Walnut Street
|
209
|
|||||||
|
Equity investment from independent investor
|
(16
|
)
|
||||||
|
December 31, 2014 Bancorp book value
|
193
|
|||||||
|
Additional marks 2015 and 2016
|
(42
|
)
|
(42
|
)
|
||||
|
Payments received
|
(43
|
)
|
||||||
|
September 30, 2017 Bancorp book value*
|
$
|
108
|
||||||
|
Total marks
|
$
|
(100
|
)
|
|||||
|
Divided by:
|
||||||||
|
Original Walnut Street loan balance
|
$
|
267
|
||||||
|
Percentage of total mark to original balance
|
37
|
%
|
||||||
|
* Approximately 30% of expected principal recoveries were classified as nonperforming as of September 30, 2017.
|
||||||||
|
Walnut Street portfolio composition as of September 30, 2017
|
||||||||
|
Collateral type
|
% of Portfolio
|
|||||||
|
Commercial real estate non-owner occupied
|
||||||||
|
Retail
|
30.8
|
%
|
||||||
|
Office
|
26.9
|
%
|
||||||
|
Other
|
15.5
|
%
|
||||||
|
Construction and land
|
16.3
|
%
|
||||||
|
Commercial non real estate and industrial
|
3.6
|
%
|
||||||
|
First mortgage residential owner occupied
|
3.3
|
%
|
||||||
|
First mortgage residential non-owner occupied
|
2.8
|
%
|
||||||
|
Other
|
0.8
|
%
|
||||||
|
Total
|
100.0
|
%
|
||||||
10
|
Cumulative analysis of marks on discontinued commercial loan principal as of September 30, 2017
|
|||||||||||
|
Discontinued
|
Cumulative
|
% to original
|
|||||||||
|
loan principal
|
marks
|
principal
|
|||||||||
|
(dollars in millions)
|
|||||||||||
|
Commercial loan discontinued principal before marks
|
$
|
230
|
|||||||||
|
Florida mall held in discontinued OREO
|
42
|
24
|
|||||||||
|
Previous mark charges
|
33
|
33
|
|||||||||
|
Mark at September 30, 2017
|
16
|
||||||||||
|
Total
|
$
|
305
|
$
|
73
|
24%
|
||||||
|
Analysis of large loan relationship principal, nonperforming loans and distribution of marks as of September 30, 2017
|
|||||||||||||||||||||||||
|
Performing
|
Nonperforming
|
Total
|
Performing
|
Nonperforming
|
Total
|
||||||||||||||||||||
|
loan principal
|
loan principal
|
loan principal
|
loan marks
|
loan marks
|
marks
|
||||||||||||||||||||
|
(in millions)
|
|||||||||||||||||||||||||
|
9 loan relationships > $8 million
|
$
|
155
|
$
|
5
|
$
|
160
|
$
|
6
|
$
|
-
|
$
|
6
|
|||||||||||||
|
Loan relationships < $8 million
|
45
|
9
|
54
|
3
|
7
|
10
|
|||||||||||||||||||
|
$
|
200
|
$
|
14
|
$
|
214
|
$
|
9
|
$
|
7
|
$
|
16
|
||||||||||||||
|
Quarterly activity for commercial loan discontinued principal
|
||||
|
Commercial
|
||||
|
loan principal
|
||||
|
(in millions)
|
||||
|
Commercial loan discontinued principal December 31, 2016 before marks
|
$
|
324
|
||
|
Transfer of Florida mall to other real estate owned
|
(42
|
)
|
||
|
2017 net paydowns
|
(39
|
)
|
||
|
2017 chargedowns of loans from marks taken in prior years
|
(13
|
)
|
||
|
Commercial loan discontinued principal September 30, 2017 before marks
|
$
|
230
|
||
|
Marks at September 30, 2017
|
(16
|
)
|
||
|
Net commercial loan exposure September 30, 2017
|
$
|
214
|
||
|
Residential mortgages
|
64
|
|||
|
Net loans
|
$
|
278
|
||
|
Florida mall in other real estate owned
|
18
|
|||
|
Other 27 properties in other real estate owned
|
19
|
|||
|
Total discontinued assets at September 30, 2017
|
$
|
315
|
||
11
|
Discontinued commercial loan composition as of September 30, 2017
|
||||||||||||
|
Collateral type
|
Unpaid
principal
balance
|
Mark
September 30,
2017
|
Mark as %
of portfolio
|
|||||||||
|
(dollars in millions)
|
||||||||||||
|
Commercial real estate - non-owner occupied:
|
||||||||||||
|
Retail
|
$
|
15
|
$
|
0.8
|
5
|
%
|
||||||
|
Office
|
9
|
0.2
|
2
|
%
|
||||||||
|
Other
|
43
|
0.1
|
-
|
|||||||||
|
Construction and land
|
84
|
1.7
|
2
|
%
|
||||||||
|
Commercial non-real estate and industrial
|
17
|
3.3
|
19
|
%
|
||||||||
|
1 to 4 family construction
|
27
|
4.5
|
17
|
%
|
||||||||
|
First mortgage residential non-owner occupied
|
20
|
4.9
|
25
|
%
|
||||||||
|
Commercial real estate owner occupied:
|
||||||||||||
|
Retail
|
10
|
-
|
0
|
%
|
||||||||
|
Office
|
-
|
-
|
-
|
|||||||||
|
Other
|
2
|
-
|
0
|
%
|
||||||||
|
Residential junior mortgage
|
1
|
-
|
0
|
%
|
||||||||
|
Other
|
2
|
-
|
-
|
|||||||||
|
Total
|
$
|
230
|
||||||||||
|
Less: mark
|
(16
|
)
|
||||||||||
|
Net commercial loan exposure September 30, 2017
|
$
|
214
|
$
|
15.5
|
7
|
%
|
||||||
12