EX-99.1 2 tv519965_ex99-1.htm EXHIBIT 99.1

 

Exhibit 99.1

 

 

Press Release For Immediate Release
  Date: April 24, 2019

 

 

 

GLEN BURNIE BANCORP ANNOUNCES

FIRST QUARTER 2019 RESULTS

 

GLEN BURNIE, MD (April 24, 2019) – Glen Burnie Bancorp (“Bancorp”) (NASDAQ: GLBZ), the bank holding company for The Bank of Glen Burnie (“Bank”), announced today net income of $135,000, or $0.05 per basic and diluted common share for the three-month period ended March 31, 2019, as compared to net income of $255,000, or $0.09 per basic and diluted common share for the three-month period ended March 31, 2018.

 

Net loan balances at March 31, 2019 grew by $24.0 million, or 8.8%, as compared to March 31, 2018. Bancorp had total assets of $393.1 million at March 31, 2019. Bancorp, the oldest independent commercial bank in Anne Arundel County, will pay its 107th consecutive quarterly dividend on May 3, 2019.

 

“Net interest income continued to rise during the first quarter, driving a consistent core earnings expansion. Net interest income in the first quarter of 2019 grew by $147,000 or 4.9%, as compared to the first quarter of last year, as the yield on our loan portfolio grew from 4.25% to 4.32%, and our funding costs increased by $118,000 or 26.1%, from $452,000 to $570,000,” stated John D. Long, President and CEO. “Our strong fundamental performance was somewhat offset by significant continued investment in technology and infrastructure improvements that enable us to remain competitive in the rapidly changing technological environment. These improvements allowed the Company to remain vigilant in its risk mitigation efforts, and continue to provide a high level of service to our valued customers. We are encouraged by the progress of the last two years and are confident that these investments have created a foundation for sustainable growth in 2019 and beyond. A favorable credit environment combined with our outstanding credit quality, disciplined loan pricing and a beneficial balance sheet structure, allowed us to reduce the provision for loan losses by $187,000 or 51.9%, this quarter as compared to the first quarter of last year. Headquartered in the dynamic Northern Anne Arundel County market, we believe the Bank is well positioned with sound growth, asset quality and capital levels, a widening net interest margin, and an experienced and seasoned executive team. We remain deeply committed to serving the financial needs of the community through the development of new loan and deposit products.”

 

Highlights for the First Three Months of 2019

 

Bancorp continued to grow organically in the first quarter of 2019 driven primarily by favorable net loan growth. Bancorp has strong liquidity and capital positions that provide ample capacity for future growth, along with the Bank’s total regulatory capital to risk weighted assets of 13.46% at March 31, 2019, as compared to 13.85% for the same period of 2018.

 

 

 

 

Return on average assets for the three-month period ended March 31, 2019 was 0.14%, as compared to 0.26% for the three-month period ended March 31, 2018. Return on average equity for the three-month period ended March 31, 2019 was 1.59%, as compared to 3.06% for the three-month period ended March 31, 2018. Lower gains on redemption of bank-owned life insurance policies (“BOLI”) and higher noninterest expenses primarily drove the lower returns.

 

The book value per share of Bancorp’s common stock was $12.23 at March 31, 2019, as compared to $11.83 per share at March 31, 2018.

 

At March 31, 2019, the Bank remained above all “well-capitalized” regulatory requirement levels. The Bank’s tier 1 risk-based capital ratio was approximately 12.51% at March 31, 2019, as compared to 12.73% at March 31, 2018. Liquidity remained strong due to managed cash and cash equivalents, borrowing lines with the FHLB of Atlanta, the Federal Reserve and correspondent banks, and the size and composition of the bond portfolio.

 

Balance Sheet Review

 

Total assets were $393.1 million at March 31, 2019, an increase of $2.7 million or 0.69%, from $390.4 million at March 31, 2018. Investment securities were $61.4 million at March 31, 2019, a decrease of $28.9 million or 32.0%, from $90.3 million at March 31, 2018. The higher volume of loan originations during 2018 were primarily funded using the proceeds from the sale of securities. Loans, net of deferred fees and costs, were $299.4 million at March 31, 2019, an increase of $23.7 million or 8.60%, from $275.7 million at March 31, 2018. Real estate acquired through foreclosure was $0.7 million at March 31, 2019, an increase of $0.6 million from March 31, 2018 primarily due to the acquisition of a single property. BOLI decreased $0.4 million or 4.7% from March 31, 2018 to March 31, 2019 primarily due to the redemption of BOLI policies. Net deferred tax assets decreased $1.6 million or 56.61% and accrued taxes receivable increased $1.2 million from March 31, 2018 to March 31, 2019 primarily due to the elimination of the alternative minimum tax under the Tax Act.

 

Total deposits were $331.6 million at March 31, 2019, a decrease of $4.6 million or 1.36%, from $336.2 million at March 31, 2018. Interest-bearing deposits were $224.4 million at March 31, 2019, a decrease of $4.7 million or 2.07%, from $229.1 million at March 31, 2018. Total borrowings were $25.0 million at March 31, 2019, an increase of $5.0 million or 25.0%, from $20.0 million at March 31, 2018.

 

Stockholders’ equity was $34.5 million at March 31, 2019, an increase of $1.3 million or 3.82%, from $33.2 million at March 31, 2018. The decrease in accumulated other comprehensive loss associated with net unrealized losses on the available for sale bond portfolio, retained earnings and stock issuances under the dividend reinvestment program, offset by decreases in unrealized gains on interest rate swap contracts drove the increase in stockholders’ equity.

 

Nonperforming assets, which consist of nonaccrual loans, troubled debt restructurings, accruing loans past due 90 days or more, and other real estate owned (“OREO”), represented 0.86% of total assets at March 31, 2019, as compared to 1.49% for the same period of 2018. The reduction in nonaccrual loans offset by the increase in OREO drove the 0.63% decrease in nonperforming assets as percentage of total assets from March 31, 2018 to 2019.

 

 

 

 

Review of Financial Results

 

For the three-month periods ended March 31, 2019 and 2018

 

Net income for the three-month period ended March 31, 2019 was $135,000, as compared to $255,000 for the three-month period ended March 31, 2018.

 

Net interest income for the three-month period ended March 31, 2019 totaled $3.14 million, as compared to $2.99 million for the three-month period ended March 31, 2018. Average loan balances increased $25.5 million or 9.32% to $299.5 million for the three-month period ended March 31, 2019, as compared to $274.0 million for the same period of 2018.

 

Net interest margin for the three-month period ended March 31, 2019 was 3.3%, as compared to 3.22% for the same period of 2018. Higher average balances and yields on interest-earning assets were the primary driver of year-over-year results, as the average balance increased $9.2 million and the yield on interest-earning assets increased 0.19% from 3.71% to 3.9%. These increases were offset by the higher cost of funds, which increased 0.12% from 0.51% to 0.63% for the three-month periods ending March 31, 2018 and 2019, respectively.

 

The provision for loan losses for the three-month period ended March 31, 2019 was $173,000, as compared to $360,000 for the same period of 2018. The decrease for the three-month period ended March 31, 2019, when compared to the three-month period ended March 31, 2018 primarily reflects $294,000 lower required reserves offset by $59,000 higher net charge offs. As a result, the allowance for loan losses was $2.61 million at March 31, 2019, representing 0.87% of total loans, as compared to $2.90 million, or 1.05% of total loans at March 31, 2018 and is consistent with our improved credit quality.

 

Noninterest income for the three-month period ended March 31, 2019 was $282,000, as compared to $486,000 for the three-month period ended March 31, 2019, a decrease of $204,000 or 41.96%. $207,000 lower gains on the redemption of BOLI policies primarily drove the decrease.

 

For the three-month period ended March 31, 2019, noninterest expense was $3.08 million, as compared to $2.84 million for the three-month period ended March 31, 2018, an increase of $242,000 or 8.54%. The primary contributors to the $242,000 million increase, when compared to the three-month period ended March 31, 2018 were increases in salary and employee benefits costs, data processing and item processing services, litigation settlement costs, OREO expenses, bank robbery loss and other insurance expenses offset by lower legal, accounting and other professional fees, and loan collection costs.

 

 

 

 

# # #

 

Glen Burnie Bancorp Information

 

Glen Burnie Bancorp is a bank holding company headquartered in Glen Burnie, Maryland. Founded in 1949, The Bank of Glen Burnie® is a locally-owned community bank with 8 branch offices serving Anne Arundel County. The Bank is engaged in the commercial and retail banking business including the acceptance of demand and time deposits, and the origination of loans to individuals, associations, partnerships and corporations. The Bank’s real estate financing consists of residential first and second mortgage loans, home equity lines of credit and commercial mortgage loans. The Bank also originates automobile loans through arrangements with local automobile dealers. Additional information is available at www.thebankofglenburnie.com.

 

Forward-Looking Statements

 

The statements contained herein that are not historical financial information, may be deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties, which could cause the company’s actual results in the future to differ materially from its historical results and those presently anticipated or projected. These statements are evidenced by terms such as “anticipate,” “estimate,” “should,” “expect,” “believe,” “intend,” and similar expressions. Although these statements reflect management’s good faith beliefs and projections, they are not guarantees of future performance and they may not prove true. For a more complete discussion of these and other risk factors, please see the company’s reports filed with the Securities and Exchange Commission.

 

For further information contact:

 

Jeffrey D. Harris, Chief Financial Officer

410-768-8883

jdharris@bogb.net

106 Padfield Blvd

Glen Burnie, MD 21061

 

 

 

 

 

 

 

GLEN BURNIE BANCORP AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

(dollars in thousands)

 

   March 31,   March 31,   December 31, 
   2019   2018   2018 
   (unaudited)   (unaudited)   (audited) 
ASSETS               
Cash and due from banks  $2,341   $2,449   $2,605 
Interest bearing deposits with banks and federal funds sold   14,194    6,079    13,349 
Total Cash and Cash Equivalents   16,535    8,528    15,954 
                
Investment securities available for sale, at fair value   61,420    90,329    81,572 
Restricted equity securities, at cost   1,439    1,231    2,481 
                
Loans, net of deferred fees and costs   299,417    275,716    299,120 
Allowance for loan losses   (2,605)   (2,899)   (2,541)
Loans, net   296,812    272,817    296,579 
                
Real estate acquired through foreclosure   705    114    705 
Premises and equipment, net   3,901    3,271    3,106 
Bank owned life insurance   7,900    8,290    7,860 
Deferred tax assets, net   1,197    2,759    1,392 
Accrued interest receivable   1,110    1,182    1,198 
Accrued taxes receivable   1,221    -    1,177 
Prepaid expenses   515    554    466 
Other assets   304    1,295    556 
Total Assets  $393,059   $390,370   $413,046 
                
LIABILITIES               
Noninterest-bearing deposits  $107,249   $107,073   $101,369 
Interest-bearing deposits   224,364    229,097    221,084 
Total Deposits   331,613    336,170    322,453 
                
Short-term borrowings   25,000    20,000    55,000 
Defined pension liability   298    341    285 
Accrued expenses and other liabilities   1,693    672    1,257 
Total Liabilities   358,604    357,183    378,995 
                
STOCKHOLDERS' EQUITY               
Common stock, par value $1, authorized 15,000,000 shares,  issued and outstanding 2,817,821, 2,804,456, and 2,814,157 shares as of March 31, 2019, March 31, 2018, and December 31, 2018, respectively.   2,818    2,804    2,814 
Additional paid-in capital   10,433    10,301    10,401 
Retained earnings   21,919    21,581    22,066 
Accumulated other comprehensive loss   (715)   (1,499)   (1,230)
Total Stockholders' Equity   34,455    33,187    34,051 
Total Liabilities and Stockholders' Equity  $393,059   $390,370   $413,046 

 

 

 

 

GLEN BURNIE BANCORP AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF INCOME

(dollars in thousands, except per share amounts)

 

   Three Months Ended March 31, 
   2019   2018 
   (unaudited)   (unaudited) 
Interest income          
Interest and fees on loans  $3,189   $2,872 
Interest and dividends on securities   400    524 
Interest on deposits with banks and federal funds sold   120    48 
Total Interest Income   3,709    3,444 
           
Interest expense          
Interest on deposits   332    309 
Interest on short-term borrowings   238    143 
Total Interest Expense   570    452 
           
Net Interest Income   3,139    2,992 
Provision for loan losses   173    360 
Net interest income after provision for loan losses   2,966    2,632 
           
Noninterest income          
Service charges on deposit accounts   61    67 
Other fees and commissions   178    168 
Gains on redemption of BOLI policies   -    207 
Gain on securities sold   3    - 
Income on life insurance   40    44 
Total Noninterest Income   282    486 
           
Noninterest expenses          
Salary and employee benefits   1,770    1,721 
Occupancy and equipment expenses   314    305 
Legal, accounting and other professional fees   231    245 
Data processing and item processing services   176    139 
FDIC insurance costs   56    58 
Advertising and marketing related expenses   27    17 
Loan collection costs   13    41 
Telephone costs   66    57 
Other expenses   424    252 
Total Noninterest Expenses   3,077    2,835 
           
Income before income taxes   171    283 
Income tax expense   (36)   28 
           
Net income  $135   $255 
           
Basic and diluted net income per common share  $0.05   $0.09 

 

 

 

 

GLEN BURNIE BANCORP AND SUBSIDIARY

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY

For the three months ended March, 2019 and 2018 (unaudited)

(dollars in thousands)

 

               Accumulated     
               Other     
       Additional       Comprehensive   Total 
   Common   Paid-in   Retained   (Loss)   Stockholders' 
   Stock   Capital   Earnings   Income   Equity 
Balance, December 31, 2017  $2,801   $10,267   $21,605   $(631)  $34,042 
                          
Net income   -    -    255    -    255 
Cash dividends, $0.10 per share   -    -    (279)   -    (279)
Dividends reinvested under dividend reinvestment plan   3    34    -    -    37 
Other comprehensive income   -    -    -    (868)   (868)
Balance, March 31, 2018  $2,804   $10,301   $21,581   $(1,499)  $33,187 

 

               Accumulated     
               Other     
       Additional       Comprehensive   Total 
   Common   Paid-in   Retained   (Loss)   Stockholders' 
   Stock   Capital   Earnings   Income   Equity 
Balance, December 31, 2018  $2,814   $10,401   $22,066   $(1,230)  $34,051 
                          
Net income   -    -    135    -    135 
Cash dividends, $0.10 per share   -    -    (282)   -    (282)
Dividends reinvested under dividend reinvestment plan   4    32    -    -    36 
Other comprehensive income   -    -    -    515    515 
Balance, March 31, 2019  $2,818   $10,433   $21,919   $(715)  $34,455 

 

 

 

 

THE BANK OF GLEN BURNIE

CAPITAL RATIOS

(dollars in thousands)

 

               To Be Well 
               Capitalized Under 
           To Be Considered   Prompt Corrective 
            Adequately Capitalized    Action Provisions 
   Amount   Ratio   Amount   Ratio   Amount   Ratio 
As of March 31, 2019:                              
(unaudited)                              
Common Equity Tier 1 Capital  $34,681    12.51%  $12,472    4.50%  $18,014    6.50%
Total Risk-Based Capital  $37,311    13.46%  $22,172    8.00%  $27,715    10.00%
Tier 1 Risk-Based Capital  $34,681    12.51%  $16,629    6.00%  $22,172    8.00%
Tier 1 Leverage  $34,681    8.68%  $15,983    4.00%  $19,978    5.00%
                               
As of December 31, 2018:                              
(audited)                              
Common Equity Tier 1 Capital  $34,778    12.27%  $12,757    4.50%  $18,427    6.50%
Total Risk-Based Capital  $37,354    13.18%  $22,679    8.00%  $28,349    10.00%
Tier 1 Risk-Based Capital  $34,778    12.27%  $17,009    6.00%  $22,679    8.00%
Tier 1 Leverage  $34,778    8.52%  $16,330    4.00%  $20,413    5.00%
                               
As of March 31, 2018:                              
(unaudited)                              
Common Equity Tier 1 Capital  $33,132    12.73%  $11,712    4.50%  $16,917    6.50%
Total Risk-Based Capital  $36,047    13.85%  $20,822    8.00%  $26,027    10.00%
Tier 1 Risk-Based Capital  $33,132    12.73%  $15,616    6.00%  $20,822    8.00%
Tier 1 Leverage  $33,126    8.40%  $15,774    4.00%  $19,718    5.00%

 

 

 

 

GLEN BURNIE BANCORP AND SUBSIDIARY

SELECTED FINANCIAL DATA

(dollars in thousands, except per share amounts)

 

   March 31,   December 31,   March 31,   December 31, 
   2019   2018   2018   2018 
   (unaudited)   (unaudited)   (unaudited)   (audited) 
                 
Financial Data                    
Assets  $393,059   $413,046   $390,370   $413,046 
Investment securities   61,420    81,572    90,329    81,572 
Loans, (net of deferred fees & costs)   299,417    299,120    275,716    299,120 
Allowance for loan losses   2,605    2,541    2,899    2,541 
Deposits   331,613    322,453    336,170    322,453 
Borrowings   25,000    55,000    20,000    55,000 
Stockholders' equity   34,455    34,051    33,187    34,051 
Net income   135    307    255    1,583 
                     
Average Balances                    
Assets  $400,064   $408,958   $391,832   $400,930 
Investment securities   69,939    85,055    92,449    89,351 
Loans, (net of deferred fees & costs)   299,506    297,791    273,964    286,702 
Deposits   323,283    332,284    334,492    335,167 
Borrowings   40,643    42,748    22,752    31,595 
Stockholders' equity   34,346    32,580    33,817    33,392 
                     
Performance Ratios                    
Annualized return on average assets   0.14%   0.30%   0.26%   0.39%
Annualized return on average equity   1.59%   3.74%   3.06%   4.74%
Net interest margin   3.30%   3.26%   3.22%   3.26%
Dividend payout ratio   209%   91%   109%   71%
Book value per share  $12.23   $12.10   $11.83   $12.10 
Basic and diluted net income per share   0.05    0.11    0.09    0.56 
Cash dividends declared per share   0.10    0.10    0.10    0.40 
Basic and diluted weighted average shares outstanding   2,816,518    2,813,045    2,802,509    2,808,031 
                     
Asset Quality Ratios                    
Allowance for loan losses to loans   0.87%   0.85%   1.05%   0.85%
Nonperforming loans to avg. loans   0.90%   0.73%   2.09%   0.76%
Allowance for loan losses to nonaccrual & 90+ past due loans   104.7%   128.7%   52.7%   128.7%
Net charge-offs annualize to avg. loans   0.27%   0.23%   0.07%   0.32%
                     
Capital Ratios                    
Common Equity Tier 1 Capital   12.51%   12.27%   12.73%   12.27%
Tier 1 Risk-based Capital Ratio   12.51%   12.27%   12.73%   12.27%
Leverage Ratio   8.68%   8.52%   8.40%   8.52%
Total Risk-Based Capital Ratio   13.46%   13.18%   13.85%   13.18%