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Glen Burnie Bancorp Announces First Quarter 2018 Results

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GLEN BURNIE, Md., April 26, 2018 (GLOBE NEWSWIRE) -- Glen Burnie Bancorp ("Bancorp") (NASDAQ:GLBZ), the bank holding company for The Bank of Glen Burnie ("Bank"), announced today net income of $0.26 million, or $0.09 per basic and diluted common share for the three-month period ended March 31, 2018, as compared to net income of $0.32 million, or $0.10 per basic and diluted common share for the three-month period ended March 31, 2017.

For the three-month period ended March 31, 2018, net loans grew by $5.7 million, or 2.1%, as compared to March 31, 2017.  At March 31, 2018, Bancorp had total assets of $390.4 million.  Bancorp, the oldest independent commercial bank in Anne Arundel County, will pay its 103rd consecutive quarterly dividend on May 4, 2018.

"By continuing our fiscal 2017 transformative accomplishments into the first quarter of 2018, we are confident that our momentum will drive our results for the remainder of 2018 and beyond," said John D. Long, President and CEO.  "Technology advancements that support our loan origination team contributed to a strong organic loan growth rate of 2.1% when compared to the same period in 2017.  We continued to make investments in technology systems during the first quarter that allow us to remain competitive in the rapidly changing technological environment.  These improvements allow the Company to remain vigilant in its risk mitigation efforts, and to continue providing a high level of service to our valued customers.  Net interest income continued to rise during the first quarter, driving a consistent core earnings expansion.  Net interest income grew by $160,000 or 5.7%, this quarter compared to the first quarter of last year, as the yield on our loan portfolio grew from 4.21% to 4.25%, and our funding costs declined by $39,000 or 7.9%, from $491,000 to $452,000.  The overall credit environment remained favorable, although a single impaired loan led management to increase the allowance for loan losses to 1.05% of total loans from 0.96% at December 31, 2017.  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 2018

Bancorp continued to grow organically in the first quarter of 2018 driven primarily by favorable net loan growth and supported by an improving 0.51% cost of funds, as compared to 0.56% for the same period in 2017.  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 13.85% at March 31, 2018.

Return on average assets for the three-month period ended March 31, 2018 was 0.26%, as compared to 0.33% for the three-month period ended March 31, 2017.  Return on average equity for the three-month period ended March 31, 2018 was 3.06%, as compared to 3.79% for the three-month period ended March 31, 2017. 

The book value per share of Bancorp's common stock was $11.83 at March 31, 2018, as compared to $12.16 per share at March 31, 2017.

At March 31, 2018, the Bank remained above all "well-capitalized" regulatory requirement levels.  The Bank's tier 1 risk-based capital ratio was approximately 12.73% at March 31, 2018, as compared to 13.14% at March 31, 2017.  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 $390.4 million at March 31, 2018, a decrease of 1.31% from $395.5 million at March 31, 2017.  Investment securities were $90.3 million at March 31, 2018, a decrease of 0.84% from $91.1 million at March 31, 2017.  Total loans were $275.7 million at March 31, 2018, an increase of 2.22% from $269.7 million at March 31, 2017.

Total deposits were $336.2 million at March 31, 2018, a decrease of 1.29% from $340.6 million at March 31, 2017.  Non-interest bearing deposits were $107.1 million at March 31, 2018, an increase of 1.80% from $105.2 million at March 31, 2017.  Total borrowings were $20.0 million at March 31, 2018, unchanged from $20.0 million at March 31, 2017.

Stockholders' equity was $33.2 million at March 31, 2018, a decrease of $0.7 million from $33.9 million at March 31, 2017.  The decrease in the first quarter 2018 was related to lower corporate earnings and a decrease in other comprehensive income associated with the available for sale bond portfolio.

Nonperforming assets, which consist of nonaccrual loans, troubled debt restructurings, accruing loans past due 90 days or more, and other real estate owned, represented 1.49% of total assets at March 31, 2018, as compared to 1.05% for the same period of 2017.

Review of Financial Results

For the three-month periods ended March 31, 2018 and 2017

Net income for the three-month period ended March 31, 2018 was $0.26 million, as compared to net income of $0.32 million for the three-month period ended March 31, 2017.

Net interest income for the three-month period ended March 31, 2018 totaled $3.0 million, as compared to $2.8 million for the three-month period ended March 31, 2017.  Average earning loans and investment securities increased to $366 million for the three month period ended March 31, 2018, as compared to $362 million for the same period of 2017.

Net interest margin for the three-month period ended March 31, 2018 was 3.22%, as compared to 3.07% for the same period of 2017.  Lower funding costs were the primary driver of year-over-year results, as the cost of funds decreased 0.05% from 0.56% to 0.51% for the three month periods ending March 31, 2017 and 2018, respectively.

The provision for loan losses for the three-month period ended March 31, 2018 was $0.36 million, as compared to $0.20 million for the same period of 2017.  The increase for the three-month period ended March 31, 2018 was primarily the result of deteriorated credit quality of a single participated loan and is not indicative of poor credit quality of the overall loan portfolio.  As a result, the allowance for loan losses was $2.9 million at March 31, 2018, representing 1.05% of total loans, as compared to $2.6 million, or 0.96% of total loans for the same period of 2017.

Noninterest income for the three-month period ended March 31, 2018 was $0.49 million, as compared to $0.30 million for the three-month period ended March 31, 2017.  The results for the first quarter of 2018 include a $0.21 million gain on redemption of BOLI policy.

For the three-month period ended March 31, 2018, noninterest expense was $2.83 million, as compared to $2.57 million for the three-month period ended March 31, 2017.  The primary contributors to the $0.26 million increase, when compared to the three-month period ended March 31, 2017 were increases in salary and employee benefits, occupancy and equipment expenses, legal, accounting and other professional fees and loan collection costs and telephone costs, partially offset by decreases in data processing and item processing services and advertising and marketing related expenses.  

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 SUBSIDIARIES 
CONSOLIDATED BALANCE SHEETS 
(dollars in thousands) 
           
  March 31,   March 31,   December 31,
    2018       2017       2017  
  (unaudited)   (unaudited)   (audited)
ASSETS          
Cash and due from banks $   2,449     $   2,959     $   2,610  
Interest bearing deposits with banks and federal funds sold   6,079       14,371       9,995  
Total Cash and Cash Equivalents   8,528       17,330       12,605  
           
Investment securities available for sale, at fair value     90,329         91,097         89,349  
Restricted equity securities, at cost      1,231         1,228         1,232  
           
Loans, net of deferred fees and costs   275,716       269,707       271,612  
Allowance for loan losses   (2,899 )     (2,602 )     (2,589 )
Loans, net   272,817       267,105       269,023  
           
Real estate acquired through foreclosure   114       114       114  
Premises and equipment, net   3,271       3,611       3,371  
Bank owned life insurance   8,290       9,377       8,713  
Deferred tax assets, net   2,759       3,133       2,429  
Accrued interest receivable   1,182       1,115       1,133  
Accrued taxes receivable     -       645       465  
Prepaid expenses   554       537       433  
Other assets   1,295       238       583  
Total Assets  $ 390,370     $ 395,530     $ 389,450  
           
LIABILITIES          
Noninterest-bearing deposits $ 107,073     $ 105,190     $ 104,017  
Interest-bearing deposits   229,097       235,396       230,221  
Total Deposits   336,170       340,586       334,238  
           
Short-term borrowings   20,000       10,000       20,000  
Long-term borrowings     -        10,000         -   
Defined pension liability   341       369       335  
Accrued Taxes Payable   134         -          -   
Accrued expenses and other liabilities   538       644       835  
Total Liabilities   357,183       361,599       355,408  
           
STOCKHOLDERS' EQUITY          
Common stock, par value $1, authorized 15,000,000 shares,  issued and outstanding 2,804,456, 2,790,260, and 2,801,149 shares as of March 31, 2018, March 31, 2017, and December 31, 2017, respectively.    2,804       2,790       2,801  
Additional paid-in capital   10,301       10,164       10,267  
Retained earnings   21,581       21,745       21,605  
Accumulated other comprehensive loss   (1,499 )     (768 )     (631 )
Total Stockholders' Equity   33,187       33,931       34,042  
Total Liabilities and Stockholders' Equity $ 390,370     $ 395,530     $ 389,450  
           


 
GLEN BURNIE BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share amounts)
         
      Three Months Ended 
March 31,
     2018    2017
     (unaudited)     (unaudited) 
Interest income        
Interest and fees on loans   $   2,872   $   2,774
Interest and dividends on securities       524       518
Interest on deposits with banks and federal funds sold       48       31
Total Interest Income     3,444     3,323
         
Interest expense        
Interest on deposits       309       333
Interest on short-term borrowings       143       82
Interest on long-term borrowings       -       76
Total Interest Expense     452     491
         
Net Interest Income     2,992     2,832
Provision for loan losses       360       195
Net interest income after provision for loan losses     2,632     2,637
         
Noninterest income        
Service charges on deposit accounts       67       67
Other fees and commissions       168       161
Gains on redemption of BOLI policies       207       -
Income on life insurance       44       49
Other income       -       2
Total Noninterest Income     486     279
         
Noninterest expenses        
Salary and employee benefits       1,721       1,421
Occupancy and equipment expenses       305       298
Legal, accounting and other professional fees       232       206
Data processing and item processing services       132       168
FDIC insurance costs       58       60
Advertising and marketing related expenses       17       31
Loan collection costs       41       18
Telephone costs       57       55
Other expenses       272       314
Total Noninterest Expenses     2,835     2,571
         
Income before income taxes     283     345
Income tax expense       28       29
         
Net income    $    255   $    316
         
Basic and diluted net income per common share    $    0.09   $    0.11
         


         
GLEN BURNIE BANCORP AND SUBSIDIARIES 
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
For the three months ended March, 2018 and 2017 (unaudited)     
(dollars in thousands)                  
                     
                Accumulated    
                Other    
        Additional       Comprehensive   Total
    Common    Paid-in   Retained   (Loss)   Stockholders'
    Stock   Capital   Earnings   Income   Equity
Balance, December 31, 2016 $   2,787   $   10,130   $   21,707     $   (810 )   $   33,814  
                     
Net income     -       -       316         -         316  
Cash dividends, $0.10 per share     -       -       (278 )       -         (278 )
Dividends reinvested under dividend reinvestment plan     3       34       -         -         37  
Other comprehensive loss     -       -       -         42         42  
Balance, March 31, 2017 $   2,790   $   10,164   $   21,745     $   (768 )   $   33,931  
                                     
                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  
 


                 
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, 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 %
                       
As of December 31, 2017:                      
(audited)                      
Common Equity Tier 1 Capital $ 32,946 12.83 %   $ 11,553 4.50 %   $ 16,687 6.50 %
Total Risk-Based Capital  $ 35,543 13.84 %   $ 20,538 8.00 %   $ 25,673 10.00 %
Tier 1 Risk-Based Capital  $ 32,946 12.83 %   $ 15,404 6.00 %   $ 20,538 8.00 %
Tier 1 Leverage  $ 32,928 8.43 %   $ 15,617 4.00 %   $ 19,521 5.00 %
                       
As of March 31, 2017:                      
(unaudited)                      
Common Equity Tier 1 Capital $ 33,751 13.14 %   $ 11,554 4.50 %   $ 16,690 6.50 %
Total Risk-Based Capital  $ 36,394 14.17 %   $ 20,541 8.00 %   $ 25,677 10.00 %
Tier 1 Risk-Based Capital  $ 33,751 13.14 %   $ 15,406 6.00 %   $ 20,541 8.00 %
Tier 1 Leverage  $ 33,751 8.62 %   $ 15,664 4.00 %   $ 19,580 5.00 %
                       


     
GLEN BURNIE BANCORP AND SUBSIDIARIES
SELECTED FINANCIAL DATA
(dollars in thousands, except per share amounts)  
   
                 
    Three Months Ended   Year Ended
    March 31,    December 31,    March 31,    December 31, 
     2018     2017     2017     2017 
    (unaudited)   (unaudited)   (unaudited)   (audited)
                 
Financial Data                
Assets   $   390,353     $   389,450     $   395,530     $   389,450  
Investment securities       90,329         89,349         91,097         89,349  
Loans, (net of deferred fees & costs)       275,699         271,612         269,707         271,612  
Allowance for loan losses       2,899         2,589         2,602         2,589  
Deposits       336,169         334,238         340,586         334,238  
Borrowings       20,000         20,000         20,000         20,000  
Stockholders' equity       33,188         34,042         33,931         34,042  
Net income     255       (153 )     316       911  
                 
Average Balances                
Assets   $   391,832     $   391,254     $   391,532     $   392,363  
Investment securities     92,449       90,084       94,062       91,634  
Loans, (net of deferred fees & costs)     273,964       270,402       267,494       269,600  
Deposits     334,492       335,312       234,351       335,805  
Borrowings     22,752       20,501       20,419       21,458  
Stockholders' equity     33,817       34,638       33,811       34,322  
                 
Performance Ratios                
Annualized return on average assets     0.26 %     -0.16 %     0.33 %     0.23 %
Annualized return on average equity     3.06 %     -1.75 %     3.79 %     2.65 %
Net interest margin     3.22 %     3.20 %     3.07 %     3.12 %
Dividend payout ratio     109 %     -183 %     88 %     123 %
Book value per share   $   11.83     $   12.15     $   12.16     $   12.15  
Basic and diluted net income per share   0.09       (0.05 )     0.11       0.33  
Cash dividends declared per share     0.10       0.10       0.10       0.40  
Basic and diluted weighted average shares outstanding     2,802,509       2,799,832       2,789,012       2,794,381  
                 
Asset Quality Ratios                
Allowance for loan losses to loans     1.05 %     0.95 %     0.96 %     0.95 %
Nonperforming loans to avg. loans     2.09 %     1.31 %     1.51 %     1.32 %
Allowance for loan losses to nonaccrual & 90+ past due loans     52.7 %     77.7 %     68.3 %     77.7 %
Net charge-offs annualize to avg. loans   0.07 %     0.19 %     0.12 %     0.09 %
                 
Capital Ratios                
Common Equity Tier 1 Capital     12.73 %     12.83 %     0.00 %     12.83 %
Tier 1 Risk-based Capital Ratio     12.73 %     12.83 %     14.17 %     12.83 %
Leverage Ratio     8.40 %     8.43 %     8.62 %     8.43 %
Total Risk-Based Capital Ratio     13.85 %     13.84 %     13.14 %     13.84 %
                 

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