Delaware
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23-3016517
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(State or other jurisdiction of
|
|
(IRS Employer
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incorporation)
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Identification No.)
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The Bancorp, Inc.
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||||||||
Date: October 30, 2014
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By:
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/s/ Paul Frenkiel
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||||||
Paul Frenkiel
|
||||||||
Chief Financial Officer and Secretary
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||||||||
Exhibit No.
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|
Description
|
EX-99.1
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|
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·
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Bancorp has decided to discontinue its commercial lending operations. The loans which constitute that portfolio are in the process of disposition. This represents a strategic continuation of the shift to a focus on Bancorp’s specialty lending including small fleet leasing, security backed lines of credit (“SBLOC”), CMBS origination and SBA lending. The discontinuance resulted in a charge to earnings of $18.3 million, net of tax.
|
|
·
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44% increase in net interest income to $15.4 million compared to $10.7 million in third quarter 2013.
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|
·
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21% increase in prepaid card fees to $12.3 million compared to $10.2 million in third quarter 2013.
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|
·
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33% increase in card processing and ACH fees to $1.4 million.
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·
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Increases over prior year targeted loan balances: SBA lending 65%, SBLOC 44%, Leasing 14%.
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·
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Tax equivalent yield on earning assets increased to 2.65% compared to 2.19% in third quarter 2013.
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·
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Tier one capital to assets, tier one capital to risk assets and total capital to risk assets were 8.10%, 12.95% and 13.11%, compared to well capitalized minimums of 5%, 6% and 10%.
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Financial highlights
|
||||||||||||||||
(unaudited)
|
||||||||||||||||
Three months ended
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Nine months ended
|
|||||||||||||||
September 30,
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September 30,
|
|||||||||||||||
2014
|
2013
|
2014
|
2013
|
|||||||||||||
(dollars in thousands except per share data)
|
||||||||||||||||
Condensed income statement
|
||||||||||||||||
Net interest income
|
$ | 15,380 | $ | 10,676 | $ | 44,118 | $ | 29,370 | ||||||||
Provision for loan and lease losses
|
965 | 379 | 3,420 | 461 | ||||||||||||
Non-interest income
|
||||||||||||||||
Service fees on deposit accounts
|
1,640 | 1,238 | 4,146 | 3,296 | ||||||||||||
Card payment and ACH processing fees
|
1,369 | 1,027 | 3,989 | 2,940 | ||||||||||||
Prepaid card fees
|
12,307 | 10,177 | 38,673 | 33,682 | ||||||||||||
Gain on sale of loans
|
2,772 | 4,739 | 13,468 | 12,665 | ||||||||||||
Gain (loss) on sales of investment securities
|
(35 | ) | 42 | 365 | 785 | |||||||||||
Other than temporary impairment of investment securities
|
- | - | - | (20 | ) | |||||||||||
Leasing income
|
840 | 624 | 2,236 | 1,853 | ||||||||||||
Debit card income
|
414 | 158 | 1,296 | 555 | ||||||||||||
Affinity fees
|
649 | 722 | 1,851 | 2,428 | ||||||||||||
Other non-interest income
|
299 | 449 | 1,217 | 1,936 | ||||||||||||
Total non-interest income
|
20,255 | 19,176 | 67,241 | 60,120 | ||||||||||||
Non-interest expense
|
||||||||||||||||
Bank Secrecy Act and lookback consulting expenses
|
2,749 | - | 4,918 | - | ||||||||||||
Other non-interest expense
|
30,386 | 26,384 | 93,437 | 74,686 | ||||||||||||
Total non-interest expense
|
33,135 | 26,384 | 98,355 | 74,686 | ||||||||||||
Income from continuing operations before income tax expense
|
1,535 | 3,089 | 9,584 | 14,343 | ||||||||||||
Income tax expense
|
45 | 935 | 282 | 4,344 | ||||||||||||
Net income from continuing operations
|
1,490 | 2,154 | 9,302 | 9,999 | ||||||||||||
Net income (loss) from discontinued operations, net of tax
|
(18,295 | ) | 2,634 | (25,471 | ) | 7,787 | ||||||||||
Net income (loss) available to common shareholders
|
$ | (16,805 | ) | $ | 4,788 | $ | (16,169 | ) | $ | 17,786 | ||||||
Net income per share from continuing operations - basic
|
$ | 0.04 | $ | 0.06 | $ | 0.25 | $ | 0.27 | ||||||||
Net income (loss) per share from discontinued operations - basic
|
$ | (0.49 | ) | $ | 0.07 | $ | (0.68 | ) | $ | 0.21 | ||||||
Net income (loss) per share - basic
|
$ | (0.45 | ) | $ | 0.13 | $ | (0.43 | ) | $ | 0.48 | ||||||
Net income per share from continuing operations - diluted
|
$ | 0.04 | $ | 0.06 | $ | 0.25 | $ | 0.26 | ||||||||
Net income (loss) per share from discontinued operations - diluted
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$ | (0.49 | ) | $ | 0.07 | $ | (0.68 | ) | $ | 0.21 | ||||||
Net income (loss) per share - diluted
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$ | (0.45 | ) | $ | 0.13 | $ | (0.43 | ) | $ | 0.47 | ||||||
Weighted average shares - basic
|
37,708,862 | 37,440,838 | 37,698,759 | 37,359,230 | ||||||||||||
Weighted average shares - diluted
|
37,708,862 | 38,283,317 | 37,698,759 | 37,978,108 |
Balance sheet
|
September 30,
|
June 30,
|
December 31,
|
September 30,
|
||||||||||||
2014
|
2014
|
2013
|
2013
|
|||||||||||||
(dollars in thousands)
|
||||||||||||||||
Assets:
|
||||||||||||||||
Cash and cash equivalents
|
||||||||||||||||
Cash and due from banks
|
$ | 9,913 | $ | 13,288 | $ | 31,890 | $ | 30,056 | ||||||||
Interest earning deposits at Federal Reserve Bank
|
430,117 | 441,422 | 1,196,515 | 657,618 | ||||||||||||
Securities sold under agreements to resell
|
55,450 | 15,906 | 7,544 | 40,811 | ||||||||||||
Total cash and cash equivalents
|
495,480 | 470,616 | 1,235,949 | 728,485 | ||||||||||||
Investment securities, available-for-sale, at fair value
|
1,442,049 | 1,459,626 | 1,253,117 | 1,083,154 | ||||||||||||
Investment securities, held-to-maturity
|
96,951 | 97,130 | 97,205 | 97,459 | ||||||||||||
Loans held for sale, at fair value
|
136,115 | 154,474 | 69,904 | 25,557 | ||||||||||||
Loans, net of deferred fees and costs
|
866,765 | 812,164 | 655,320 | 636,038 | ||||||||||||
Allowance for loan and lease losses
|
(4,390 | ) | (4,082 | ) | (2,164 | ) | (2,516 | ) | ||||||||
Loans, net
|
862,375 | 808,082 | 653,156 | 633,522 | ||||||||||||
Federal Home Loan Bank & Atlantic Central Bankers Bank stock
|
3,409 | 3,409 | 3,209 | 3,209 | ||||||||||||
Premises and equipment, net
|
17,536 | 16,236 | 15,659 | 14,252 | ||||||||||||
Accrued interest receivable
|
11,272 | 10,692 | 8,747 | 8,157 | ||||||||||||
Intangible assets, net
|
6,573 | 6,988 | 7,612 | 6,253 | ||||||||||||
Other real estate owned
|
725 | - | - | - | ||||||||||||
Deferred tax asset, net
|
41,601 | 24,606 | 30,415 | 26,434 | ||||||||||||
Assets held for sale
|
1,143,380 | 1,227,215 | 1,299,914 | 1,345,530 | ||||||||||||
Other assets
|
39,046 | 36,089 | 31,178 | 28,271 | ||||||||||||
Total assets
|
$ | 4,296,512 | $ | 4,315,163 | $ | 4,706,065 | $ | 4,000,283 | ||||||||
Liabilities:
|
||||||||||||||||
Deposits
|
||||||||||||||||
Demand and interest checking
|
$ | 3,412,593 | $ | 3,424,719 | $ | 3,585,241 | $ | 2,923,591 | ||||||||
Savings and money market
|
241,518 | 226,085 | 434,834 | 407,179 | ||||||||||||
Time deposits
|
24 | 24 | 142 | 142 | ||||||||||||
Time deposits, $100,000 and over
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- | - | 100 | 101 | ||||||||||||
Total deposits
|
3,654,135 | 3,650,828 | 4,020,317 | 3,331,013 | ||||||||||||
Securities sold under agreements to repurchase
|
21,496 | 17,481 | 21,221 | 22,057 | ||||||||||||
Accrued interest payable
|
- | - | - | 73 | ||||||||||||
Subordinated debenture
|
13,401 | 13,401 | 13,401 | 13,401 | ||||||||||||
Liabilities held for sale
|
227,898 | 231,587 | 253,203 | 238,614 | ||||||||||||
Other liabilities
|
23,194 | 29,371 | 38,319 | 41,792 | ||||||||||||
Total liabilities
|
$ | 3,940,124 | $ | 3,942,668 | $ | 4,346,461 | $ | 3,646,950 | ||||||||
Shareholders' equity:
|
||||||||||||||||
Common stock - authorized, 50,000,000 shares of $1.00 par value; 37,808,862 and 37,720,945 shares issued at September 30, 2014 and 2013, respectively
|
37,809 | 37,809 | 37,721 | 37,721 | ||||||||||||
Treasury stock (100,000 shares)
|
(866 | ) | (866 | ) | (866 | ) | (866 | ) | ||||||||
Additional paid-in capital
|
297,122 | 296,523 | 294,576 | 292,715 | ||||||||||||
Retained earnings
|
10,955 | 27,763 | 27,615 | 20,291 | ||||||||||||
Accumulated other comprehensive income
|
11,368 | 11,266 | 558 | 3,472 | ||||||||||||
Total shareholders' equity
|
356,388 | 372,495 | 359,604 | 353,333 | ||||||||||||
Total liabilities and shareholders' equity
|
$ | 4,296,512 | $ | 4,315,163 | $ | 4,706,065 | $ | 4,000,283 |
Average balance sheet and net interest income
|
Three months ended September 30, 2014
|
Three months ended September 30, 2013
|
||||||||||||||||||||||
(dollars in thousands)
|
Average
|
Average
|
Average
|
Average
|
||||||||||||||||||||
Assets:
|
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
||||||||||||||||||
Interest-earning assets:
|
||||||||||||||||||||||||
Loans net of unearned fees and costs **
|
$ | 907,691 | $ | 9,032 | 3.98 | % | $ | 658,139 | $ | 7,058 | 4.29 | % | ||||||||||||
Leases - bank qualified*
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16,706 | 218 | 5.22 | % | 17,894 | 260 | 5.81 | % | ||||||||||||||||
Investment securities-taxable
|
1,029,544 | 5,311 | 2.06 | % | 837,700 | 4,057 | 1.94 | % | ||||||||||||||||
Investment securities-nontaxable*
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526,393 | 4,858 | 3.69 | % | 297,301 | 2,040 | 2.74 | % | ||||||||||||||||
Interest earning deposits at Federal Reserve Bank
|
477,609 | 285 | 0.24 | % | 702,492 | 438 | 0.25 | % | ||||||||||||||||
Federal funds sold/securities purchased under agreement to resell
|
31,153 | 105 | 1.35 | % | 44,289 | 157 | 1.42 | % | ||||||||||||||||
Net interest earning assets
|
2,989,096 | 19,809 | 2.65 | % | 2,557,815 | 14,010 | 2.19 | % | ||||||||||||||||
Allowance for loan and lease losses
|
(8,473 | ) | (4,850 | ) | ||||||||||||||||||||
Assets held for sale
|
1,227,796 | 12,689 | 4.13 | % | 1,355,442 | 13,618 | 4.02 | % | ||||||||||||||||
Other assets
|
85,541 | 76,321 | ||||||||||||||||||||||
$ | 4,293,960 | $ | 3,984,728 | |||||||||||||||||||||
Liabilities and Shareholders' Equity:
|
||||||||||||||||||||||||
Deposits:
|
||||||||||||||||||||||||
Demand and interest checking
|
$ | 3,389,692 | $ | 2,233 | 0.26 | % | $ | 2,881,927 | $ | 1,999 | 0.28 | % | ||||||||||||
Savings and money market
|
221,604 | 290 | 0.52 | % | 352,831 | 402 | 0.46 | % | ||||||||||||||||
Total deposits
|
3,611,296 | 2,523 | 0.28 | % | 3,234,758 | 2,401 | 0.30 | % | ||||||||||||||||
Repurchase agreements
|
18,396 | 13 | 0.28 | % | 19,771 | 13 | 0.26 | % | ||||||||||||||||
Subordinated debt
|
13,401 | 116 | 3.46 | % | 13,401 | 115 | 3.43 | % | ||||||||||||||||
Total deposits and interest bearing liabilities
|
3,643,093 | 2,652 | 0.29 | % | 3,267,930 | 2,529 | 0.31 | % | ||||||||||||||||
Liabilities held for sale
|
272,220 | 112 | 0.16 | % | 369,576 | 177 | 0.19 | % | ||||||||||||||||
Other liabilities
|
14,585 | 2,896 | ||||||||||||||||||||||
Total liabilities
|
3,929,898 | 3,640,402 | ||||||||||||||||||||||
Shareholders' equity
|
364,062 | 344,326 | ||||||||||||||||||||||
$ | 4,293,960 | $ | 3,984,728 | |||||||||||||||||||||
Net interest income on tax equivalent basis*
|
$ | 29,734 | $ | 24,922 | ||||||||||||||||||||
Tax equivalent adjustment
|
1,776 | 805 | ||||||||||||||||||||||
Net interest income
|
$ | 27,958 | $ | 24,117 | ||||||||||||||||||||
Net interest margin *
|
2.81 | % | 2.53 | % | ||||||||||||||||||||
* Full taxable equivalent basis using a 35% statutory tax rate.
|
||||||||||||||||||||||||
** Includes loans held for sale.
|
Average balance sheet and net interest income
|
Nine months ended September 30, 2014
|
Nine months ended September 30, 2013
|
||||||||||||||||||||||
(dollars in thousands)
|
Average
|
Average
|
Average
|
Average
|
||||||||||||||||||||
Assets:
|
Balance
|
Interest
|
Rate
|
Balance
|
Interest
|
Rate
|
||||||||||||||||||
Interest-earning assets:
|
||||||||||||||||||||||||
Loans net of unearned fees and costs **
|
$ | 858,829 | $ | 25,977 | 4.03 | % | $ | 611,251 | $ | 20,025 | 4.37 | % | ||||||||||||
Leases - bank qualified*
|
17,756 | 708 | 5.32 | % | 15,376 | 668 | 5.79 | % | ||||||||||||||||
Investment securities-taxable
|
1,037,344 | 15,804 | 2.03 | % | 785,973 | 11,345 | 1.92 | % | ||||||||||||||||
Investment securities-nontaxable*
|
459,508 | 12,613 | 3.66 | % | 210,678 | 4,499 | 2.85 | % | ||||||||||||||||
Interest earning deposits at Federal Reserve Bank
|
793,560 | 1,460 | 0.25 | % | 960,220 | 1,781 | 0.25 | % | ||||||||||||||||
Federal funds sold/securities purchased under agreement to resell
|
28,612 | 296 | 1.38 | % | 32,897 | 279 | 1.13 | % | ||||||||||||||||
Net interest-earning assets
|
3,195,609 | 56,858 | 2.37 | % | 2,616,395 | 38,597 | 1.97 | % | ||||||||||||||||
Allowance for loan and lease losses
|
(3,492 | ) | (2,359 | ) | ||||||||||||||||||||
Assets held for sale
|
1,285,922 | 38,732 | 4.02 | % | 1,350,838 | 41,615 | 4.11 | % | ||||||||||||||||
Other assets
|
96,627 | 75,955 | ||||||||||||||||||||||
$ | 4,574,666 | $ | 4,040,829 | |||||||||||||||||||||
Liabilities and Shareholders' Equity:
|
||||||||||||||||||||||||
Deposits:
|
||||||||||||||||||||||||
Demand and interest checking
|
$ | 3,569,670 | $ | 6,721 | 0.25 | % | $ | 2,933,218 | $ | 5,725 | 0.26 | % | ||||||||||||
Savings and money market
|
271,621 | 976 | 0.48 | % | 349,437 | 1,222 | 0.47 | % | ||||||||||||||||
Total deposits
|
3,841,291 | 7,697 | 0.27 | % | 3,282,655 | 6,947 | 0.28 | % | ||||||||||||||||
Short-term borrowings
|
7 | - | 0.00 | % | - | - | 0.00 | % | ||||||||||||||||
Repurchase agreements
|
17,262 | 37 | 0.29 | % | 17,545 | 39 | 0.30 | % | ||||||||||||||||
Subordinated debt
|
13,401 | 344 | 3.42 | % | 13,401 | 433 | 4.31 | % | ||||||||||||||||
Total deposits and interest bearing liabilities
|
3,871,961 | 8,078 | 0.28 | % | 3,313,601 | 7,419 | 0.30 | % | ||||||||||||||||
Liabilities held for sale
|
308,465 | 410 | 0.18 | % | 375,131 | 605 | 0.22 | % | ||||||||||||||||
Other liabilities
|
16,839 | 7,963 | ||||||||||||||||||||||
Total liabilities
|
4,197,265 | 3,696,695 | ||||||||||||||||||||||
Shareholders' equity
|
377,401 | 344,134 | ||||||||||||||||||||||
$ | 4,574,666 | $ | 4,040,829 | |||||||||||||||||||||
Net interest income on tax equivalent basis*
|
87,102 | 72,188 | ||||||||||||||||||||||
Tax equivalent adjustment
|
4,662 | 1,808 | ||||||||||||||||||||||
Net interest income
|
$ | 82,440 | $ | 70,380 | ||||||||||||||||||||
Net interest margin *
|
2.59 | % | 2.41 | % | ||||||||||||||||||||
* Fully taxable equivalent basis using a 35% statutory tax rate
|
||||||||||||||||||||||||
** Includes loans held for sale.
|
Allowance for loan and lease losses:
|
Nine months ended
|
Year ended
|
||||||||||||||
September 30,
|
September 30,
|
December 31,
|
||||||||||||||
2014
|
2013
|
2013
|
||||||||||||||
(dollars in thousands)
|
||||||||||||||||
Balance in the allowance for loan and lease losses at beginning of period (1)
|
$ | 2,163 | $ | 2,381 | $ | 2,381 | ||||||||||
Loans charged-off:
|
||||||||||||||||
SBA non real estate, student loan commercial and commercial mortgage
|
42 | 2 | 44 | |||||||||||||
SBA construction
|
- | - | - | |||||||||||||
Direct lease financing
|
323 | - | 30 | |||||||||||||
SBLOC and other consumer loans
|
846 | 354 | 446 | |||||||||||||
Total
|
1,211 | 356 | 520 | |||||||||||||
Recoveries:
|
||||||||||||||||
SBA non real estate, student loan commercial and commercial mortgage
|
- | - | - | |||||||||||||
SBA construction
|
- | - | - | |||||||||||||
Direct lease financing
|
- | 8 | 8 | |||||||||||||
SBLOC and other consumer loans
|
18 | 22 | 53 | |||||||||||||
Total
|
18 | 30 | 61 | |||||||||||||
Net charge-offs
|
1,193 | 326 | 459 | |||||||||||||
Provision charged to operations
|
3,420 | 461 | 241 | |||||||||||||
Balance in allowance for loan and lease losses at end of period
|
$ | 4,390 | $ | 2,516 | $ | 2,163 | ||||||||||
Net charge-offs/average loans
|
0.14 | % | 0.05 | % | 0.07 | % | ||||||||||
Net charge-offs/average loans (annualized)
|
0.18 | % | 0.07 | % | 0.07 | % | ||||||||||
Net charge-offs/average assets
|
0.03 | % | 0.01 | % | 0.01 | % | ||||||||||
(1) Excludes activity from assets held for sale
|
||||||||||||||||
Loan portfolio:
|
September 30,
|
June 30,
|
December 31,
|
September 30,
|
||||||||||||
2014 | 2014 | 2013 | 2013 | |||||||||||||
(dollars in thousands)
|
||||||||||||||||
SBA non real estate and student loan commercial
|
$ | 96,079 | $ | 97,445 | $ | 53,391 | $ | 59,325 | ||||||||
SBA commercial mortgage
|
95,492 | 90,316 | 75,666 | 62,911 | ||||||||||||
SBA construction
|
16,472 | 9,936 | 51 | - | ||||||||||||
Total commercial loans
|
208,043 | 197,697 | 129,108 | 122,236 | ||||||||||||
Direct lease financing
|
201,825 | 185,877 | 175,610 | 177,797 | ||||||||||||
SBLOC and other consumer loans
|
448,497 | 420,421 | 345,703 | 331,697 | ||||||||||||
858,365 | 803,995 | 650,421 | 631,730 | |||||||||||||
Unamortized loan fees and costs
|
8,400 | 8,169 | 4,899 | 4,308 | ||||||||||||
Total loans, net of deferred loan fees and costs
|
$ | 866,765 | $ | 812,164 | $ | 655,320 | $ | 636,038 |
Tier 1 capital
|
Tier 1 capital
|
Total capital
|
|||
to average assets
|
to risk-weighted assets
|
to risk-weighted assets
|
|||
As of September 30, 2014
|
|||||
Bancorp
|
8.10%
|
12.95%
|
13.11%
|
||
The Bancorp Bank
|
7.51%
|
12.03%
|
12.19%
|
||
"Well capitalized" institution (under FDIC regulations)
|
5.00%
|
6.00%
|
10.00%
|
||
As of December 31, 2013
|
|||||
Bancorp
|
8.58%
|
14.57%
|
15.83%
|
||
The Bancorp Bank
|
6.72%
|
11.40%
|
12.66%
|
||
"Well capitalized" institution (under FDIC regulations)
|
5.00%
|
6.00%
|
10.00%
|
Three months ended
|
Nine months ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
2014
|
2013
|
2014
|
2013
|
|||||||||||||
Selected operating ratios:
|
||||||||||||||||
Return on average assets (annualized)
|
nm
|
0.48 | % |
nm
|
0.59 | % | ||||||||||
Return on average equity (annualized)
|
nm
|
5.52 | % |
nm
|
6.91 | % | ||||||||||
Net interest margin
|
2.81 | % | 2.53 | % | 2.59 | % | 2.41 | % | ||||||||
Book value per share
|
$ | 9.45 | $ | 9.39 | $ | 9.45 | $ | 9.39 | ||||||||
September 30,
|
June 30,
|
December 31,
|
September 30,
|
|||||||||||||
2014 | 2014 | 2013 | 2013 | |||||||||||||
Asset quality ratios:
|
||||||||||||||||
Nonperforming loans to total loans (1)
|
0.55 | % | 0.43 | % | 0.25 | % | 0.28 | % | ||||||||
Nonperforming assets to total assets (1)
|
0.13 | % | 0.08 | % | 0.03 | % | 0.05 | % | ||||||||
Allowance for loan and lease losses to total loans
|
0.51 | % | 0.50 | % | 0.33 | % | 0.40 | % | ||||||||
Nonaccrual loans
|
$ | 4,495 | $ | 3,413 | $ | 1,524 | $ | 1,602 | ||||||||
Other real estate owned
|
725 | - | - | - | ||||||||||||
Total nonperforming assets
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$ | 5,220 | $ | 3,413 | $ | 1,524 | $ | 1,602 | ||||||||
Loans 90 days past due still accruing interest
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$ | 264 | $ | 119 | $ | 110 | $ | 204 | ||||||||
Three months ended
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September 30,
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June 30,
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December 31,
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September 30,
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2014 | 2014 | 2013 | 2013 | |||||||||||||
Gross dollar volume (GDV):
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Prepaid card GDV
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$ | 9,323,312 | $ | 10,025,213 | $ | 7,720,554 | $ | 7,178,533 | ||||||||
(1) Nonperforming loan and asset ratios include nonaccrual loans and loans 90 days past due still accruing interest.
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