ANNAPOLIS, Md., July 27, 2018 /PRNewswire/ -- Severn
Bancorp, Inc., (Nasdaq: SVBI) parent company of Severn Bank, today
announced net income of $1.9 million
for the three months ending June 30,
2018 versus $982 thousand for
the same quarter in 2017. This is an increase of 95% year over year
for the period. On a diluted per share basis, earnings were
$0.15 versus $0.08 for the quarters ended June 30, 2018 and 2017, respectively. Net income
for the six months ended June 30,
2018 is $3.8 million, a 99%
increase over net income of $1.9
million for the same six month period in 2017.
Net interest income increased 15.3% during the second quarter of
2018. Net interest income was $6.9
million during the second quarter of 2018 versus
$6.0 million during the second
quarter of 2017. Net interest margin improved to 3.57% for the
three months ending June 30, 2018
from 3.26% for the same period in 2017. Net interest income
increased to $13.9 million for the
first six months of 2018 from $11.6
million for the same time frame in 2017. Non-interest
expenses increased modestly by 11% from $5.8
million for the second quarter of 2017 to $6.5 million for 2018. The additional expense was
mostly related to new lending staff being added.
Severn Bank experienced a significant increase in mortgage
banking revenue of 126% in the second quarter of 2018 versus the
second quarter of 2017. Year to date mortgage banking revenue saw
an increase of 51% for the first six months of 2018 versus 2017.
The company's efficiency ratio improved to 71.23% for the three
months ending June 30, 2018 versus
82.96% for that same three months in 2017. Year over year the
efficiency ratio improved to 70.59% from 82.11% for the first six
months of 2018 and 2017 respectively.
"Earnings for the company are the best they have been in
some time", stated Alan J. Hyatt,
President and Chief Executive Officer. Mr. Hyatt continued,
"In June we opened a new branch in Lothian/Wayson's Corner so we now have
excellent coverage of the county from north to south. We are making
tremendous progress in picking up some strong local business
relationships and bringing key staff on board. We were pleased to
be able to pay a dividend the past couple of quarters, and
management and the Board of Directors are focused on continued
improvement in our operations and enhancing long term shareholder
value."
About Severn Bank: Founded in 1946, Severn is a full-service community bank
offering a wide array of personal and commercial banking products
as well as residential and commercial mortgage lending. It has
assets of $821 million and six
branches located in Annapolis,
Edgewater, Severna Park, Lothian/Wayson's Corner and Glen Burnie, Maryland. The bank specializes in
exceptional customer service and holds itself and its employees to
a high standard of community contribution. Severn is on the Web at
www.severnbank.com.
Forward Looking Statements
In addition to the historical information contained herein, this
press release contains forward-looking statements that involve
risks and uncertainties that may be affected by various factors
that may cause actual results to differ materially from those in
the forward-looking statements. The forward-looking statements
contained herein include, but are not limited to, those with
respect to management's determination of the amount of loan loss
reserve and statements about the economy. The words "anticipate,"
"believe," "estimate," "expect," "intend," "may," "plan," "will,"
"would," "could," "should," "guidance," "potential," "continue,"
"project," "forecast," "confident," and similar expressions are
typically used to identify forward-looking statements. Severn's operations and actual results could
differ significantly from those discussed in the forward-looking
statements. Some of the factors that could cause or contribute to
such differences include, but are not limited to, changes in the
economy and interest rates both in the nation and in Severn's general market area, federal and
state regulation, competition and other factors detailed from time
to time in Severn's filings with
the Securities and Exchange Commission (the "SEC"), including "Item
1A. Risk Factors" contained in Severn's Annual Report on Form 10-K for the
fiscal year ended December 31,
2017.
|
Severn Bancorp,
Inc.
|
|
Consolidated
Income Statement
|
|
(dollars in
thousands, except per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Quarterly income
statement results:
|
Three Months Ended
June 30,
|
|
|
|
|
|
|
|
2018
|
2017
|
$
Change
|
%
Change
|
|
|
|
|
|
|
|
|
|
|
|
Interest
Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
loans
|
$
8,516
|
$
7,394
|
$
1,122
|
15.17%
|
|
|
Interest on
securities
|
307
|
328
|
(21)
|
-6.40%
|
|
|
Other interest
income
|
178
|
174
|
4
|
2.30%
|
|
|
|
|
|
|
|
|
|
|
|
Total interest
income
|
9,001
|
7,896
|
1,105
|
13.99%
|
|
|
|
|
|
|
|
|
|
|
|
Interest
Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
1,274
|
938
|
336
|
35.82%
|
|
|
Interest on long term
borrowings
|
800
|
951
|
(151)
|
-15.88%
|
|
|
|
|
|
|
|
|
|
|
|
Total interest
expense
|
2,074
|
1,889
|
185
|
9.79%
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
6,927
|
6,007
|
920
|
15.32%
|
|
|
|
|
|
|
|
|
|
|
|
Provision for
(reversal of) loan losses
|
0
|
(375)
|
375
|
-100.00%
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
after provision for (reversal of) loan losses
|
6,927
|
6,382
|
545
|
8.54%
|
|
|
|
|
|
|
|
|
|
|
|
Non-Interest
Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage-banking
revenue
|
635
|
281
|
354
|
125.98%
|
|
|
Real Estate
Commissions
|
360
|
268
|
92
|
34.33%
|
|
|
Real Estate
Management Income
|
187
|
122
|
65
|
53.28%
|
|
|
All other
income
|
1,010
|
334
|
676
|
202.40%
|
|
|
|
|
|
|
|
|
|
|
|
Net Non-Interest
Income
|
2,192
|
1,005
|
1,187
|
118.11%
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
plus non-interest income
|
9,119
|
7,387
|
1,732
|
23.45%
|
|
|
after provision for (reversal of) loan losses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Interest
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and
related expenses
|
4,420
|
3,674
|
746
|
20.30%
|
|
|
Net Occupancy &
Depreciation
|
391
|
325
|
66
|
20.31%
|
|
|
Net Costs of
Foreclosed Real Estate
|
(18)
|
7
|
(25)
|
-357.14%
|
|
|
Other
|
|
1,684
|
1,818
|
(134)
|
-7.37%
|
|
|
|
|
|
|
|
|
|
|
|
Total non-interest
expenses
|
6,477
|
5,824
|
653
|
11.21%
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
tax provision
|
2,642
|
1,563
|
1,079
|
69.03%
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
provision
|
724
|
581
|
143
|
24.61%
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
1,918
|
$
982
|
$
936
|
95.32%
|
|
|
Net income available
to common shareholders
|
$
1,918
|
$
912
|
$
1,006
|
110.31%
|
|
|
|
|
|
|
|
|
|
|
|
Severn Bancorp,
Inc.
|
|
Consolidated
Income Statement
|
|
(dollars in
thousands, except per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Year-to-Date
income statement results:
|
Six Months Ended
June 30,
|
|
|
|
|
|
|
2018
|
2017
|
$
Change
|
%
Change
|
|
|
|
|
|
|
|
|
|
Interest
Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
loans
|
$
16,887
|
$
14,525
|
$
2,362
|
16.26%
|
|
Interest on
securities
|
627
|
597
|
30
|
5.03%
|
|
Other interest
income
|
364
|
331
|
33
|
9.97%
|
|
|
|
|
|
|
|
|
|
Total interest
income
|
17,878
|
15,453
|
2,425
|
15.69%
|
|
|
|
|
|
|
|
|
|
Interest
Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on
deposits
|
2,407
|
1,913
|
494
|
25.82%
|
|
Interest on long term
borrowings
|
1,560
|
1,947
|
(387)
|
-19.88%
|
|
|
|
|
|
|
|
|
|
Total interest
expense
|
3,967
|
3,860
|
107
|
2.77%
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
13,911
|
11,593
|
2,318
|
19.99%
|
|
|
|
|
|
|
|
|
|
Provision for
(reversal of) loan losses
|
0
|
(650)
|
650
|
-100.00%
|
|
|
|
|
|
|
|
|
|
Net interest income
after provision for (reversal of) loan losses
|
13,911
|
12,243
|
1,668
|
13.62%
|
|
|
|
|
|
|
|
|
|
Non-Interest
Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage-banking
revenue
|
1,230
|
816
|
414
|
50.74%
|
|
Real Estate
Commissions
|
745
|
648
|
97
|
14.97%
|
|
Real Estate
Management Income
|
370
|
316
|
54
|
17.09%
|
|
All other
income
|
1,716
|
583
|
1,133
|
194.34%
|
|
|
|
|
|
|
|
|
|
Net Non-Interest
Inccome
|
4,061
|
2,363
|
1,698
|
71.86%
|
|
|
|
|
|
|
|
|
|
Net interest income
plus non-interest income
|
17,972
|
14,606
|
3,366
|
23.05%
|
|
after provision for (reversal of) loan losses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Interest
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and
related expenses
|
8,698
|
7,431
|
1,267
|
17.05%
|
|
Net Occupancy &
Depreciation
|
735
|
661
|
74
|
11.20%
|
|
Net Costs of
Foreclosed Real Estate
|
14
|
40
|
(26)
|
-65.00%
|
|
Other
|
|
3,253
|
3,367
|
(114)
|
-3.39%
|
|
|
|
|
|
|
|
|
|
Total non-interest
expenses
|
12,700
|
11,499
|
1,201
|
10.44%
|
|
|
|
|
|
|
|
|
|
Income before income
tax provision
|
5,272
|
3,107
|
2,165
|
69.68%
|
|
|
|
|
|
|
|
|
|
Income tax
provision
|
1,469
|
1,200
|
269
|
22.42%
|
|
|
|
|
|
|
|
|
|
Net income
|
$
3,803
|
$
1,907
|
$
1,896
|
99.42%
|
|
Net income available
to common shareholders
|
$
3,733
|
$
1,767
|
$
1,966
|
111.26%
|
|
|
|
|
|
|
|
|
|
Severn Bancorp,
Inc.
|
|
Consolidated
Balance Sheet
|
|
(dollars in
thousands, except per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2018
|
December 31,
2017
|
$
Change
|
%
Change
|
|
Balance Sheet
Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Cash
|
|
$
2,239
|
$
2,382
|
$
(143)
|
-6.00%
|
|
Federal funds and
Interest bearing deposits in other banks
|
19,926
|
19,471
|
455
|
2.34%
|
|
Certificates of
deposit held as investment
|
8,780
|
8,780
|
0
|
0.00%
|
|
Investment securities
available for sale
|
11,975
|
10,119
|
1,856
|
18.34%
|
|
Investment securities
held to maturity
|
46,487
|
54,303
|
(7,816)
|
-14.39%
|
|
Loans held for
sale
|
9,444
|
4,530
|
4,914
|
108.48%
|
|
Loans
receivable
|
686,912
|
668,151
|
18,761
|
2.81%
|
|
Loan valuation
allowance
|
(8,257)
|
(8,055)
|
(202)
|
2.51%
|
|
Accrued interest
receivable
|
2,604
|
2,640
|
(36)
|
-1.36%
|
|
Foreclosed real
estate, net
|
295
|
403
|
(108)
|
-26.80%
|
|
Premises and
equipment, net
|
23,059
|
23,139
|
(80)
|
-0.35%
|
|
Restricted stock
investments
|
4,227
|
4,489
|
(262)
|
-5.84%
|
|
Bank owned life
insurance
|
5,146
|
5,064
|
82
|
1.62%
|
|
Deferred income
taxes
|
3,993
|
5,302
|
(1,309)
|
-24.69%
|
|
Prepaid expenses and
other assets
|
3,858
|
4,069
|
(211)
|
-5.19%
|
|
|
|
|
|
|
|
|
|
|
|
|
$
820,688
|
$
804,787
|
$
15,901
|
1.98%
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS EQUITY
|
|
|
|
|
|
Deposits
|
$
621,615
|
$
602,228
|
$
19,387
|
3.22%
|
|
Borrowings
|
82,000
|
88,500
|
(6,500)
|
-7.34%
|
|
Subordinated
debentures
|
20,619
|
20,619
|
-
|
0.00%
|
|
Accounts payable and
accrued expenses
|
2,413
|
2,340
|
73
|
3.12%
|
|
|
|
|
|
|
|
|
|
Total
Liabilities
|
726,647
|
713,687
|
12,960
|
1.82%
|
|
|
|
|
|
|
|
|
|
Preferred
stock
|
-
|
4
|
(4)
|
-100.00%
|
|
Common
stock
|
127
|
122
|
5
|
4.10%
|
|
Additional paid-in
capital
|
65,157
|
65,137
|
20
|
0.03%
|
|
Retained
earnings
|
28,858
|
25,872
|
2,986
|
11.54%
|
|
Accumulated
comprehensive income (loss)
|
(101)
|
(35)
|
(66)
|
188.57%
|
|
|
|
|
|
|
|
|
|
Total
Stockholders' Equity
|
94,041
|
91,100
|
2,941
|
3.23%
|
|
|
|
|
|
|
|
|
|
|
|
|
$
820,688
|
$
804,787
|
$
15,901
|
1.98%
|
|
Severn Bancorp,
Inc.
|
|
|
|
Selected Financial
Data
|
|
|
|
(dollars in
thousands, except per share data)
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30,
|
|
Three Months Ended
June 30,
|
|
|
|
|
|
|
2018
|
2017
|
|
2018
|
2017
|
|
|
|
Per Share
Data:
|
|
|
|
|
.
|
|
|
|
Basic earnings per
share
|
$
0.30
|
$
0.15
|
|
$
0.15
|
$
0.08
|
|
|
|
Diluted earnings per
share
|
$
0.30
|
$
0.14
|
|
$
0.15
|
$
0.07
|
|
|
|
Average basic shares
outstanding
|
12,463,132
|
12,125,324
|
|
12,684,711
|
12,125,324
|
|
|
|
Average diluted
shares outstanding
|
12,559,069
|
12,209,250
|
|
12,781,037
|
12,209,250
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance
Ratios:
|
|
|
|
|
|
|
|
|
Return on average
assets
|
0.95%
|
0.45%
|
|
0.95%
|
0.46%
|
|
|
|
Return on average
equity
|
9.04%
|
4.03%
|
|
8.12%
|
4.14%
|
|
|
|
Net interest
margin
|
3.62%
|
3.18%
|
|
3.57%
|
3.26%
|
|
|
|
Efficiency
ratio*
|
70.59%
|
82.11%
|
|
71.23%
|
82.96%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2018
|
December 31,
2017
|
|
|
|
|
|
|
Asset Quality
Data:
|
|
|
|
|
|
|
|
|
Non-accrual
loans
|
$
7,610
|
$
5,710
|
|
|
|
|
|
|
Foreclosed real
estate
|
295
|
403
|
|
|
|
|
|
|
|
Total non-performing
assets
|
7,905
|
6,113
|
|
|
|
|
|
|
Total non-accrual
loans to total loans
|
1.1%
|
0.9%
|
|
|
|
|
|
|
Total non-accrual
loans to total assets
|
0.9%
|
0.7%
|
|
|
|
|
|
|
Allowance for loan
losses
|
8,257
|
8,055
|
|
|
|
|
|
|
Allowance for loan
losses to total loans
|
1.2%
|
1.2%
|
|
|
|
|
|
|
Allowance for loan
losses to total
|
|
|
|
|
|
|
|
|
|
non-accrual
loans
|
108.5%
|
141.1%
|
|
|
|
|
|
|
Total non-performing
assets to total assets
|
1.0%
|
0.8%
|
|
|
|
|
|
|
Non-accrual troubled
debt restructurings (included above)
|
803
|
820
|
|
|
|
|
|
|
Performing troubled
debt restructurings
|
11,868
|
13,714
|
|
|
|
|
|
|
Loan to deposit
ratio
|
110.5%
|
110.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
|
This non-GAAP
financial measure is calculated as noninterest expenses less OREO
expenses divided by net interest income plus noninterest
income
|
|
|
View original content with
multimedia:http://www.prnewswire.com/news-releases/severn-bancorp-inc-announces-substantial-increase-in-second-quarter-earnings-300687776.html
SOURCE Severn Bancorp, Inc.