TBBK Bancorp Inc

The Bancorp, Inc. ("The Bancorp") (NASDAQ: TBBK), a financial holding company, today reported financial results for the fourth quarter and full year 2017.

Highlights

• Fourth quarter and full year pre tax income of $10.2 million and $40.4 million, respectively, from continuing operations
• Net interest income increased 7% to $26.7 million for the quarter ended December 31, 2017, compared to $25.0 million for the quarter ended December 31, 2016.
• Net interest margin increased to 3.11% for the quarter ended December 31, 2017, compared to 2.84% for the quarter ended December 31, 2016.
• Prepaid fees for the quarter ended December 31, 2017 increased to $14.1 million, or 18%, compared to fourth quarter 2016.
• Loans increased 14% to $1.39 billion at December 31, 2017, compared to $1.22 billion at December 31, 2016.
• Security backed lines of credit (“SBLOC”) increased 16% to $730.5 million at December 31, 2017, compared to $630.4 million at December 31, 2016.
• Direct lease financing increased 9% to $378.0 million at December 31, 2017 compared to $346.6 million at December 31, 2016.
• Small Business Administration (“SBA”) loans increased 9% to $401.9 million at December 31, 2017, compared to $369.8 million at December 31, 2016.
• The rate on average deposits and interest bearing liabilities of $3.71 billion in the fourth quarter of 2017 was 0.45% with a rate of 0.56% for $2.05 billion of average prepaid card deposits.
• Assets held for sale from discontinued operations decreased 16% to $304.2 million at December 31, 2017, compared to $360.7 million at December 31, 2016.
• Consolidated leverage ratio was 7.9% at December 31, 2017, after the deferred tax adjustment relating to the tax reform reduction in the corporate tax rate.
• Book value per common share at December 31, 2017 was $5.81 per share. The Bancorp and its subsidiary, The Bancorp Bank, remain well capitalized.

Damian Kozlowski, The Bancorp’s Chief Executive Officer, said, “2017 was a year of accomplishments and transition for The Bancorp. We made significant progress in reducing the risk of the institution and greatly enhancing productivity and efficiency while setting the necessary conditions for future success.”

While fourth quarter income before tax for continuing operations amounted to $10.2 million, a fourth quarter 2017 loss resulted from an additional tax provision of approximately $18 million resulting from the legislative change in tax rates applied to deferred tax assets. While the statutory federal rate was reduced from 34% to 21%, which reduced the carrying value of deferred tax assets, future income will be taxed at the 21% rate. The Bancorp reported net loss of $12.4 million, or $0.22 loss per diluted share, for the quarter ended December 31, 2017, compared to a net loss of $28.7 million, or $0.52 loss per diluted share for the quarter ended December 31, 2016. For full year 2017, Bancorp reported net income of $21.7 million, or $0.39 earnings per diluted share, compared to a net loss of $96.5 million, or $2.17 loss per diluted share, in full year 2016. The impact of deferred tax adjustments which reduced net income in 2017 is shown in the footnotes for return on assets and return on equity in the table section of this release. 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 7.90%, 16.75%, 17.11% and 16.75%, respectively, compared to well capitalized minimums of 5%, 8%, 10% and 6.5%, respectively. In connection with the pending sale of a Florida mall property, a charge of $3.0 million was recorded in discontinued operations in the fourth quarter of 2017. The following is a reconciliation of pre tax income to adjusted operating earnings, a non-GAAP measure which reflects the financial impact of that charge:

    Three months ended December 31, 2017 (in thousands) Pretax income (loss): Continuing operations $ 10,181 Discontinued operations   (1,429 ) Total 8,752 Add back: Loss on mall   3,000   Pretax income excluding loss on mall (1) $ 11,752     (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, January 26, 2018 by clicking on the webcast link on Bancorp's homepage at www.thebancorp.com. Or, you may dial 844.775.2543, access code 5485438. You may listen to the replay of the webcast following the live call on The Bancorp's investor relations website or telephonically until Friday, February 2, 2018 by dialing 855.859.2056, access code 5485438.

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 vehicle leasing groups in the nation. For more information please visit www.thebancorp.com.

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. Financial highlights (unaudited)     Three months ended   Year ended December 31, December 31, Condensed income statement 2017   2016 2017   2016 (dollars in thousands except per share data)   Net interest income $ 26,687   $ 24,978   $ 106,680   $ 89,966   Provision for loan and lease losses   770     1,550     2,920     3,360   Non-interest income Service fees on deposit accounts 1,893 1,789 6,788 5,124 Card payment and ACH processing fees 1,722 1,343 6,318 5,526 Prepaid card fees 14,095 11,993 53,367 51,326 Gain on sale of loans 384 2,092 17,919 2,901 Gain on sale of investment securities 636 40 2,231 3,171 Change in value of investment in unconsolidated entity - (25,220 ) (20 ) (37,533 ) Leasing income 575 551 2,663 2,007 Affinity fees 100 1,056 1,545 4,563 Gain on sale of health savings accounts - - 2,538 - Loss from sale of European prepaid card operations - - (3,437 ) - Other non-interest income   744     710     1,636     5,401   Total non-interest income 20,149 (5,646 ) 91,548 42,486 Non-interest expense Losses and write downs on other real estate owned - - 19 - Bank Secrecy Act and lookback consulting expenses - 5 - 29,081 One time fee to exit data processing contract - - 1,136 - Civil money penalty (210 ) - 2,290 - Other non-interest expense   36,095     42,123     151,469     169,492   Total non-interest expense   35,885     42,128     154,914     198,573   Income (loss) from continuing operations before income tax expense 10,181 (24,346 ) 40,394 (69,481 ) Income tax expense (benefit)   23,513     2,557     23,056     (12,664 ) Net income (loss) from continuing operations (13,332 ) (26,903 ) 17,338 (56,817 ) Discontinued operations Income (loss) from discontinued operations before income taxes (1,429 ) (5,044 ) 4,059 (43,117 ) Income tax benefit   (2,326 )   (3,278 )   (276 )   (3,442 ) Net income (loss) from discontinued operations, net of tax   897     (1,766 )   4,335     (39,675 ) Net income (loss) available to common shareholders $ (12,435 ) $ (28,669 ) $ 21,673   $ (96,492 )   Net income (loss) per share from continuing operations - basic $ (0.24 ) $ (0.49 ) $ 0.31   $ (1.28 ) Net income (loss) per share from discontinued operations - basic $ 0.02   $ (0.03 ) $ 0.08   $ (0.89 ) Net income (loss) per share - basic $ (0.22 ) $ (0.52 ) $ 0.39   $ (2.17 )   Net income (loss) per share from continuing operations - diluted $ (0.24 ) $ (0.49 ) $ 0.31   $ (1.28 ) Net income (loss) per share from discontinued operations - diluted $ 0.02   $ (0.03 ) $ 0.08   $ (0.89 ) Net income (loss) per share - diluted $ (0.22 ) $ (0.52 ) $ 0.39   $ (2.17 ) Weighted average shares - basic 55,759,372 55,419,204 55,686,507 44,567,357 Weighted average shares - diluted 56,656,710 55,790,543 56,176,269 44,776,138   For loss periods the weighted averages shares - basic is used in both the basic and diluted computations.           Balance sheet December 31, September 30, June 30, December 31, 2017 2017 2017 2016 (dollars in thousands) Assets: Cash and cash equivalents Cash and due from banks $ 3,152 $ 5,813 $ 6,458 $ 4,127 Interest earning deposits at Federal Reserve Bank 841,471 328,023 475,387 955,733 Securities sold under agreements to resell   64,312     65,095     65,076     39,199   Total cash and cash equivalents   908,935     398,931     546,921     999,059     Investment securities, available-for-sale, at fair value 1,294,484 1,196,956 1,149,116 1,248,614 Investment securities, held-to-maturity 86,380 86,402 93,419 93,467 Loans held for sale, at fair value 503,316 380,272 542,819 663,140 Loans, net of deferred fees and costs 1,392,228 1,374,060 1,370,263 1,222,911 Allowance for loan and lease losses   (7,096 )   (7,283 )   (7,353 )   (6,332 ) Loans, net   1,385,132     1,366,777     1,362,910     1,216,579   Federal Home Loan Bank & Atlantic Community Bancshares stock 991 991 6,211 1,613 Premises and equipment, net 20,051 21,087 22,004 24,125 Accrued interest receivable 10,900 10,131 10,880 10,589 Intangible assets, net 5,377 5,185 5,515 6,906 Other real estate owned 593 - - 104 Deferred tax asset, net 34,802 53,017 53,226 55,666 Investment in unconsolidated entity 74,473 107,711 120,862 126,930 Assets held for sale from discontinued operations 304,170 314,994 336,246 360,711 Other assets   78,543     51,164     53,888     50,611   Total assets $ 4,708,147   $ 3,993,618   $ 4,304,017   $ 4,858,114     Liabilities: Deposits Demand and interest checking $ 3,806,965 $ 3,113,212 $ 3,437,482 $ 3,816,524 Savings and money market   453,877     452,183     438,602     421,780   Total deposits   4,260,842     3,565,395     3,876,084     4,238,304     Securities sold under agreements to repurchase 217 180 273 274 Subordinated debenture 13,401 13,401 13,401 13,401 Long-term borrowings 42,323 42,482 42,680 263,099 Other liabilities   67,214     32,699     40,560     44,073   Total liabilities $ 4,383,997   $ 3,654,157   $ 3,972,998   $ 4,559,151     Shareholders' equity: Common stock - authorized, 75,000,000 shares of $1.00 par value; 55,861,150 and 55,419,204 shares issued at December 31, 2017 and 2016, respectively 55,861 55,860 55,858 55,419 Treasury stock (100,000 shares) (866 ) (866 ) (866 ) (866 ) Additional paid-in capital 363,196 362,340 361,478 360,564 Accumulated deficit (89,484 ) (77,850 ) (85,114 ) (111,941 ) Accumulated other comprehensive loss   (4,557 )   (23 )   (337 )   (4,213 ) Total shareholders' equity   324,150     339,461     331,019     298,963     Total liabilities and shareholders' equity $ 4,708,147   $ 3,993,618   $ 4,304,017   $ 4,858,114         Average balance sheet and net interest income Three months ended December 31, 2017 Three months ended December 31, 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 ** $ 1,749,644 $ 19,764 4.52 % $ 1,717,927 $ 18,374 4.28 % Leases - bank qualified* 19,510 383 7.85 % 21,018 414 7.88 % Investment securities-taxable 1,329,508 9,132 2.75 % 1,371,209 8,437 2.46 % Investment securities-nontaxable* 13,119 119 3.63 % 37,529 156 1.66 % Interest earning deposits at Federal Reserve Bank 386,796 1,241 1.28 % 403,834 560 0.55 % Federal funds sold and securities purchased under agreement to resell   64,839     379 2.34 %   39,485     151 1.53 % Net interest earning assets 3,563,416 31,018 3.48 % 3,591,002 28,092 3.13 %   Allowance for loan and lease losses (7,079 ) (5,781 ) Assets held for sale from discontinued operations 311,005 3,062 3.94 % 377,044 3,238 3.44 % Other assets   190,465     257,469   $ 4,057,807   $ 4,219,734     Liabilities and Shareholders' Equity: Deposits: Demand and interest checking $ 3,205,273 $ 3,319 0.41 % $ 3,405,296 $ 2,182 0.26 % Savings and money market   454,038     545 0.48 %   407,039     498 0.49 % Total deposits 3,659,311 3,864 0.42 % 3,812,335 2,680 0.28 %   Short-term borrowings 38,250 138 1.44 % 55,913 96 0.69 % Securities sold under agreements to repurchase 219 - 0.00 % 304 - 0.00 % Subordinated debentures   13,401     153 4.57 %   13,401     137 4.09 % Total deposits and interest bearing liabilities 3,711,181 4,155 0.45 % 3,881,953 2,913 0.30 %   Other liabilities   14,820     18,896   Total liabilities 3,726,001 3,900,849   Shareholders' equity   331,806     318,885   $ 4,057,807   $ 4,219,734   Net interest income on tax equivalent basis* $ 29,925 $ 28,417   Tax equivalent adjustment   176   200   Net interest income $ 29,749 $ 28,217 Net interest margin * 3.11 % 2.84 %       * Full taxable equivalent basis, using a 35% statutory tax rate. ** Includes loans held for sale.       Average balance sheet and net interest income Year ended December 31, 2017 Year ended December 31, 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 ** $ 1,763,392 $ 78,033 4.43 % $ 1,587,306 $ 66,436 4.19 % Leases - bank qualified* 20,750 1,613 7.77 % 20,718 1,748 8.44 % Investment securities-taxable 1,284,941 36,121 2.81 % 1,303,445 31,219 2.40 % Investment securities-nontaxable* 14,094 470 3.33 % 54,271 1,139 2.10 % Interest earning deposits at Federal Reserve Bank 495,568 5,202 1.05 % 466,728 2,237 0.48 % Federal funds sold and securities purchased under agreement to resell   61,309     1,310 2.14 %   30,448     450 1.48 % Net interest-earning assets 3,640,054 122,749 3.37 % 3,462,916 103,229 2.98 %   Allowance for loan and lease losses (6,865 ) (4,741 ) Assets held for sale 310,058 12,655 4.08 % 490,115 18,275 3.73 % Other assets   221,097     266,777   $ 4,164,344   $ 4,215,067     Liabilities and Shareholders' Equity: Deposits: Demand and interest checking $ 3,371,969 $ 12,155 0.36 % $ 3,347,191 $ 9,399 0.28 % Savings and money market 439,625 2,263 0.51 % 394,434 1,526 0.39 % Time   -     - 0.00 %   77,576     447 0.58 % Total deposits 3,811,594 14,418 0.38 % 3,819,201 11,372 0.30 %   Short-term borrowings 24,224 336 1.39 % 57,517 359 0.62 % Securities sold under agreements to repurchase 239 - 0.00 % 685 2 0.29 % Subordinated debentures   13,401     586 4.37 %   13,401     520 3.88 % Total deposits and interest bearing liabilities 3,849,458 15,340 0.40 % 3,890,804 12,253 0.31 %   Other liabilities   3,329     14,916   Total liabilities 3,852,787 3,905,720   Shareholders' equity   311,557     309,347   $ 4,164,344   $ 4,215,067   Net interest income on tax equivalent basis* $

120,064

$

109,251

  Tax equivalent adjustment   729   1,010   Net interest income $ 119,335 $ 108,241

Net interest margin*

3.04 % 2.74 %       * Full taxable equivalent basis, using a 35% statutory tax rate. ** Includes loans held for sale.           Allowance for loan and lease losses: Year ended Year ended December 31, December 31, 2017 2016 (dollars in thousands)   Balance in the allowance for loan and lease losses at beginning of period (1) $ 6,332   $ 4,400     Loans charged-off: SBA non real estate 1,171 128 SBA commercial mortgage - - Direct lease financing 926 119 Other consumer loans   110     1,211   Total   2,207     1,458     Recoveries: SBA non real estate 18 1 Direct lease financing 7 17 Other consumer loans   26     12   Total   51     30   Net charge-offs 2,156 1,428 Provision charged to operations   2,920     3,360     Balance in allowance for loan and lease losses at end of period $ 7,096   $ 6,332   Net charge-offs/average loans 0.12 % 0.09 % Net charge-offs/average assets 0.05 % 0.03 % (1) Excludes activity from assets held for sale.   Loan portfolio: December 31, September 30, June 30, December 31, 2017 2017 2017 2016 (dollars in thousands)   SBA non real estate $ 71,263 $ 72,055 $ 74,511 $ 74,644 SBA commercial mortgage 142,086 132,997 126,224 126,159 SBA construction   16,740     14,205     11,057   8,826 Total SBA loans 230,089 219,257 211,792 209,629 Direct lease financing 378,029 369,069 371,002 346,645 SBLOC 730,462 720,279 718,707 630,400 Other specialty lending 30,720 36,664 44,389 11,073 Other consumer loans   14,133     20,107     15,858   17,374 1,383,433 1,365,376 1,361,748 1,215,121 Unamortized loan fees and costs   8,795     8,684     8,515   7,790 Total loans, net of deferred loan fees and costs $ 1,392,228   $ 1,374,060   $ 1,370,263 $ 1,222,911   Small business lending portfolio: December 31, September 30, June 30, December 31, 2017 2017 2017 2016 (dollars in thousands)   SBA loans, including deferred fees and costs 236,724 225,909 218,253 215,786 SBA loans included in HFS   165,177     160,855     158,389   154,016 Total SBA loans $ 401,901   $ 386,764   $ 376,642 $ 369,802           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 December 31, 2017 The Bancorp, Inc. 7.90 % 16.75 % 17.11 % 16.75 % The Bancorp Bank 7.61 % 16.22 % 16.58 % 16.22 % "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 Year ended December 31, December 31, 2017 2016 2017 2016 Selected operating ratios: Return on average assets (annualized) (1) nm nm 0.52 % nm Return on average equity (annualized) (1) nm nm 6.96 % nm Net interest margin 3.11 % 2.84 % 3.04 % 2.74 % Book value per share $ 5.81 $ 5.40 $ 5.81 $ 5.40   Three months ended Year ended December 31, 2017 December 31, 2017   Net income (loss) available to common shareholders $ (12,435 ) $ 21,673 Add: Q4 deferred tax adjustment: change in rate due to tax reform 18,000 18,000 Subtract: Q2 reversal of deferred tax valuation allowance   -     (10,940 ) Adjusted net income available to common shareholders $ 5,565   $ 28,733   Divided by: Average assets 4,057,807 4,164,344 Adjusted ROA (1) 0.55 % 0.69 %   Three months ended Year ended December 31, 2017 December 31, 2017   Net income (loss) available to common shareholders $ (12,435 ) $ 21,673 Add: Q4 deferred tax adjustment: change in rate due to tax reform 18,000 18,000 Subtract: Q2 reversal of deferred tax valuation allowance   -     (10,940 ) Adjusted net income available to common shareholders $ 5,565   $ 28,733   Divided by: Average equity 331,806 311,557 Adjusted ROE (1) 6.71 % 9.22 %   (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.           December 31, September 30, June 30, December 31, 2017 2017 2017 2016 Asset quality ratios: Nonperforming loans to total loans (2) 0.30 % 0.39 % 0.41 % 0.30 % Nonperforming assets to total assets (2) 0.10 % 0.13 % 0.13 % 0.08 % Allowance for loan and lease losses to total loans 0.51 % 0.53 % 0.54 % 0.52 %   Nonaccrual loans $ 3,996 $ 4,953 $ 5,115 $ 2,972 Other real estate owned   593     -     104     104   Total nonperforming assets $ 4,589   $ 4,953   $ 5,219   $ 3,076     Loans 90 days past due still accruing interest $ 227   $ 354   $ 494   $ 661     (2) Nonperforming loan and asset ratios include nonaccrual loans and loans 90 days past due still accruing interest.

 

  Three months ended December 31, September 30, June 30, December 31, 2017 2017 2017 2016 (in thousands) Gross dollar volume (GDV) (1): Prepaid card GDV $ 10,963,456   $ 10,970,085   $ 11,894,601   $ 10,647,520    

(1) Gross dollar volume represents the total dollar amount spent on prepaid and debit cards issued by The Bancorp.

      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   (77) December 31, 2017 Bancorp book value* $ 74     Total marks $ (100) Divided by: Original Walnut Street loan balance $ 267 Percentage of total mark to original balance 37%   * Approximately 28% of expected principal recoveries were classified as nonperforming as of December 31, 2017.   Walnut Street portfolio composition as of December 31, 2017   Collateral type   % of Portfolio Commercial real estate non-owner occupied Retail 44.6% Office 14.2% Other 3.3% Construction and land 23.5% Commercial non real estate and industrial 4.6% First mortgage residential owner occupied 4.8% First mortgage residential non-owner occupied 3.9% Other     1.1% Total 100.0%     Cumulative analysis of marks on discontinued commercial loan principal as of December 31, 2017       Discontinued Cumulative % to original loan principal   marks   principal (dollars in millions)   Commercial loan discontinued principal before marks $ 225 $ - Florida mall held in discontinued OREO 42 27 Previous mark charges 33 33 Mark at December 31, 2017       16 Total $ 300   $ 76 25%     Analysis of large loan relationship principal, nonperforming loans and distribution of marks as of December 31, 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 $ 153 $ 5 $ 158 $ 6 $ - $ 6 Loan relationships < $8 million   40     11     51   4     6     10 $ 193   $ 16   $ 209 $ 10   $ 6   $ 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 (44) 2017 chargedowns of loans from marks taken in prior years   (13) Commercial loan discontinued principal December 31, 2017 before marks 225 Marks at December 31, 2017   (16) Net commercial loan exposure December 31, 2017 209 Residential mortgages   61 Net loans 270 Florida mall in other real estate owned prior to Q4 writedown 18 Writedown of Florida mall in Q4 (3) Other 29 properties in other real estate owned   19 Total discontinued assets at December 31, 2017 $ 304     Discontinued commercial loan composition as of December 31, 2017       Collateral type

Unpaidprincipalbalance

 

MarkDecember 31,2017

 

Mark as %of portfolio

(dollars in millions) Commercial real estate - non-owner occupied: Retail $ 13 $ 0.8 6% Office 8 0.2 3% Other 43 0.2 0% Construction and land 85 1.8 2% Commercial non-real estate and industrial 16 3.3 21% 1 to 4 family construction 26 4.3 17% First mortgage residential non-owner occupied 19 4.9 26% Commercial real estate owner occupied: Retail 10 - 0% Office - - - Other 2 - 0% Residential junior mortgage 1 - 0% Other   2   - 0% Total $ 225 Less: mark   (16)     Net commercial loan exposure December 31, 2017 $ 209 $ 15.5 7%  

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The Bancorp, Inc.Andres Viroslav, 215-861-7990aviroslav@thebancorp.com