BLOOMINGTON, Ind., July 28, 2009 (GLOBE NEWSWIRE) -- Monroe Bancorp (the "Company") (Nasdaq:MROE), the independent Bloomington-based holding company for Monroe Bank (the "Bank"), today reported net income of $776,000 or $0.125 per diluted common share for the quarter ended June 30, 2009 compared to $1,860,000 or $0.299 per diluted common share for the same period in 2008. This represents a 58.3 percent decrease in net income and a 58.2 percent decrease in diluted earnings per share. Return on average assets and return on average equity for the second quarter of 2009 were 0.38 percent and 5.53 percent, respectively, compared to 0.96 percent and 13.26 percent, respectively, for the second quarter of 2008. As discussed below, the decrease in year over year net income is largely related to the increased provision for loan losses and increased FDIC expenses, including a special FDIC assessment that was applied during the second quarter of 2009.
Net income for the second quarter of 2009 decreased by $331,000 or 29.9 percent compared to net income for the first quarter of 2009.
Net income for the first six months of 2009 totaled $1,882,000 or $0.303 per diluted common share compared to $3,453,000 or $0.554 per diluted common share for the same period of 2008. This represents a 45.5 percent decrease in net income and a 45.3 percent decrease in diluted earnings per share. Return on average assets and return on average equity were 0.46 percent and 6.75 percent, respectively, for the first six months of 2009 compared to 0.89 percent and 12.46 percent, respectively, for the first six months of 2008.
The decline in net income between the second quarter of 2009 and the second quarter of 2008 was largely the result of asset quality issues and increased FDIC expense. The provision for loan losses totaled $2,200,000 for the second quarter of 2009 compared to $1,050,000 for the same period of 2008. An increase in non-accrual loans impacted net interest income. Nonperforming loans totaled $18,576,000 on June 30, 2009, compared to $13,696,000 on March 31, 2009 and $15,906,000 on June 30, 2008. Additional asset quality information is presented in the section titled Asset Quality.
The provision for loan losses in the second quarter of 2009 was $400,000 less than the $2,600,000 made during the first quarter of 2009.
FDIC expense, partially due to a special assessment expensed during the second quarter, totaled $650,000 for the second quarter of 2009, compared to $283,000 for the first quarter of 2009 and $156,000 for the second quarter of 2008.
The combination of the increased provision and increased FDIC expense reduced pre-tax income by $1,644,000 during the second quarter of 2009 compared to the second quarter of 2008. The combined impact of these two expenses was $33,000 less in the second quarter of 2009 than the first quarter of 2009 and therefore did not contribute to the decline in net income between those periods. The primary cause of the decline in net income between the first and second quarter of 2009 was a $664,000 decrease in gains from the sale of securities.
Pretax income was also unfavorably impacted by a reduced level of gains on the sale of securities in the Bank's investment portfolio. Total gains on the sale of securities during the second quarter were $364,000 compared to $439,000 for the same quarter of 2008 and $1,028,000 for the first quarter of 2009.
During the second quarter, we took steps to strengthen our capital and the capital of the Bank. On July 17, 2009, Monroe Bancorp raised $13 million of Tier 2 capital through the issuance of subordinated debentures. The subordinated debentures were issued as the result of a public offering underwritten by Howe Barnes Hoefer & Arnett, Inc. The debentures carry an interest rate of 10.0% and will mature on June 30, 2019. The Company has the right to call the debt at any time after three years. The offering closed on July 17, 2009. The subordinated debentures were issued pursuant to the prospectus filed as part of the Company's registration statement under the Securities Act of 1933. The net proceeds from the offering will provide additional capital to Monroe Bank in order to solidify our balance sheet against future credit losses and, eventually, to support our continued growth. Proceeds from the offering will also be used for general corporate purposes at the holding company level.
"While continuing to feel the pressure of the economic downturn, ongoing issues with real estate related loans and the special FDIC assessment, I am pleased we were able to produce over $700,000 of net income during the quarter," said Mark D. Bradford, President and Chief Executive Officer. "Our efforts to contain and manage our problem assets, control costs and actively build business have helped us achieve this positive result. We are also pleased that we improved the capital of the Company and the Bank."
Financial Performance
Net interest income before the provision for loan losses increased 5.0 percent to $6,045,000 for the three months ended June 30, 2009 compared to $5,756,000 for the same period in 2008. The increase is largely attributable to lower funding costs and a $37,521,000 increase in average loans. The tax-equivalent net interest margin as a percentage of average earning assets for the quarter ended June 30, 2009 was 3.21 percent, compared to 3.20 percent for the quarter ended March 31, 2009 and 3.31 percent for the second quarter of 2008.
Net interest income before the provision for loan losses, increased $355,000 or 3.1 percent to $11,987,000 for the six months ended June 30, 2009 compared to $11,632,000 for the same period in 2008. The tax-equivalent net interest margin for the first six months of 2009 was 3.20 percent, compared to 3.33 percent for the first six months of 2008. A reconciliation of the non-GAAP tax-equivalent net interest margin to the GAAP net interest margin is provided in a table entitled "Reconciliation of GAAP Net Interest Margin to Non-GAAP Net Interest Margin on a Tax-Equivalent Basis," included at the end of the attached financial summary.
Noninterest income totaled $3,186,000 for the second quarter of 2009 compared to $3,024,000 for the same period of 2008. Excluding the effect of the Company's deferred compensation plan, discussed in the "Use of Non-GAAP Financial Information" section of this release, noninterest income totaled $2,964,000 for the second quarter of 2009 compared to $3,066,000 for the same period of 2008, a decrease of $102,000 or 3.3 percent. The decrease in noninterest income was driven by declines in deposit related service charges (declined $98,000), trust fees (declined $105,000) and other operating income (declined $151,000) offsetting a $279,000 increase in fees earned on the sale of residential mortgages.
Noninterest income totaled $6,448,000 for the first six months of 2009 compared to $5,388,000 for the same period of 2008. Excluding the effect of the Company's deferred compensation plan, noninterest income totaled $6,358,000 for the first six months of 2009 compared to $5,622,000 for the same period of 2008. The $736,000 or 13.1 percent increase over the same period of 2008 was primarily the result of an $813,000 increase in gains from the sale of securities.
Noninterest expense was $6,123,000 for the three months ended June 30, 2009, compared to $5,371,000 for the same period of 2008. Noninterest expense, adjusted to remove the effect of the Company's deferred compensation plan, was $5,883,000 for the three months ended June 30, 2009, compared to $5,390,000 for the same period of 2008. A reconciliation of the non-GAAP noninterest income and expense, adjusted to remove the effect of the Company's deferred compensation plan, is provided in a table entitled "Reconciliation of GAAP Noninterest Income & Expense to Noninterest Income & Expense Without the Financial Impact of the Deferred Compensation Plan", included at the end of the attached financial summary. The $493,000 or 9.1 percent increase in noninterest expense is largely the result of the $494,000 increase in FDIC expense. The increase in FDIC expense resulted primarily from a special FDIC assessment that took place during the second quarter.
Noninterest expense totaled $11,346,000 for the first six months of 2009 compared to $10,762,000 for the same period of 2008. Noninterest expense, excluding the effect of the Company's deferred compensation plan, was $11,220,000 for the first six months of 2009, compared to $10,941,000 for the same period of 2008. The $279,000, or 2.6 percent increase is driven by a $731,000 increase in FDIC expense which more than offset a $266,000 or 6.0 percent decrease in salaries and wages.
Asset Quality
Nonperforming assets and 90-day past due loans totaled $22,959,000 (2.79 percent of total assets) at June 30, 2009 compared to $17,289,000 (2.10 percent of total assets) at March 31, 2009 and $16,472,000 (2.12 percent of total assets) at June 30, 2008.
Net charge-offs for the second quarter of 2009 totaled $1,576,000 or 1.01 percent of total loans compared to $1,436,000 (0.91 percent of total loans) for the first quarter of 2009 and $575,000 (0.38 percent of total loans) for the second quarter of 2008.
The Bank employs an internal system called the "Watch List" to bring attention to credits with varying degrees of concern over the prospects of complete repayment, including both principal and all interest. These concerns may be objectively based on the borrower's financial and payment performance or on subjective concerns that Bank management has with the markets and conditions that the borrower operates within. Loans on this list include:
-- Loans with well defined weaknesses where the prospect of complete
repayment of principal and interest is remote and loans placed on
non-accrual where specific reserves and charge-offs are applied as
needed, and
-- Loans with potential weaknesses (whether borrower specific or due
to market/economic considerations) that need to be resolved in
order to avoid jeopardizing the complete repayment of principal
and interest and the loan is subjected to additional scrutiny and
assessment and internal documentation.
Loans on the Watch List tend to be more dependent on collateral if the borrower's repayment capacity is diminished and the Bank devotes additional attention to revaluing the collateral as appropriate in assessing the probability of loss.
--------------------------------------------------
6/30/2009 3/31/2009 12/31/2008 6/30/2008
---------------------------------------------------------------------
Total Loans $ 624,018,000 630,842,000 633,091,000 602,369,000
---------------------------------------------------------------------
Total Watch List
Loans 76,720,000 79,073,000 59,172,000 27,911,000
---------------------------------------------------------------------
Number of Watch
List Customers 69 67 52 42
---------------------------------------------------------------------
Total Watch List $
> 30 Days Past Due 17,368,000 22,370,000 14,751,000 16,129,000
---------------------------------------------------------------------
Total Watch List $
Customers Secured
by Real Estate 70,697,000 72,005,000 55,507,000 24,929,000
---------------------------------------------------------------------
Total Watch List $
Secured by Non R/E 5,855,000 6,878,000 3,268,000 2,782,000
---------------------------------------------------------------------
Total Watch List $
Unsecured 168,000 190,000 397,000 200,000
---------------------------------------------------------------------
---------------------------------------------------------------------
Total Non Performing
Loans $ 18,576,000 13,696,000 14,329,000 15,906,000
---------------------------------------------------------------------
As of June 30, 2009, 77.4 percent of the Watch List exposure was less than thirty days past due, compared to 71.7 percent as of March 31, 2009 and 42.2 percent as of June 30, 2008. Of the $76,720,000 of loans on the watch list on June 30, 2009, $57,337,000 (74.7 percent) were originated out of our Central Indiana (greater Indianapolis) offices.
The chart that follows provides details of watch list loans by collateral type.
----------------------------------------------------
Total Bank % on Total $
Owned Watch Watch Non > 30 Days
Balance List List Accrual Late
---------------------------------------------------------------------
Total Loans
at 6/30/09 624,018,000 76,720,000 12.3% 17,076,000 18,656,000
---------------------------------------------------------------------
Loans in Process 4,053,000 NA NA NA NA
=====================================================================
Loans Analyzed
Below: 619,965,000 76,720,000 12.4% 17,076,000 18,656,000
---------------------------------------------------------------------
---------------------------------------------------------------------
Secured by Real
Estate
---------------------------------------------------------------------
1-4 Family
Owner Occupied
and Rentals 137,695,000 6,651,000 4.8% 1,213,000 1,564,000
---------------------------------------------------------------------
Pre Sold 1-4
Residential
Construction 2,353,000 1,568,000 66.6% -- 180,000
---------------------------------------------------------------------
Spec 1-4
Residential
Construction 16,863,000 9,983,000 59.2% 3,373,000 3,374,000
---------------------------------------------------------------------
Multi Family -
Construction 4,032,000 -- 0.0% -- --
---------------------------------------------------------------------
Multi Family -
Other than
Construction 84,843,000 1,992,000 2.3% -- --
---------------------------------------------------------------------
Other CRE Owner
Occupied
Construction 2,851,000 -- 0.0% -- --
---------------------------------------------------------------------
Other CRE Non-
Owner Occupied
Construction 11,604,000 -- 0.0% -- --
---------------------------------------------------------------------
Other CRE Loans
- Other Than
Construction 227,743,000 23,890,000 10.5% 9,160,000 9,676,000
---------------------------------------------------------------------
Land
Development
Commercial 928,000 328,000 35.4% 328,000 328,000
---------------------------------------------------------------------
Land
Development
Residential 33,167,000 26,285,000 79.2% 2,239,000 2,239,000
=====================================================================
Sub Total -
Secured by
Real Estate: 522,079,000 70,697,000 13.5% 16,313,000 17,361,000
---------------------------------------------------------------------
---------------------------------------------------------------------
Other Secured
Loans
---------------------------------------------------------------------
Business Assets 62,043,000 5,502,000 8.9% 398,000 560,000
---------------------------------------------------------------------
Consumer
Products 10,699,000 4,000 0.0% -- 158,000
---------------------------------------------------------------------
Financial
Assets 10,262,000 349,000 3.4% 350,000 540,000
=====================================================================
Sub Total:
Other Secured
Loans: 83,004,000 5,855,000 7.1% 748,000 1,258,000
---------------------------------------------------------------------
---------------------------------------------------------------------
Unsecured
Loans
---------------------------------------------------------------------
Unsecured Loans 14,882,000 168,000 1.1% 15,000 37,000
---------------------------------------------------------------------
"While I am pleased by the drop in total watch list loans, I remain disappointed with the Company's overall level of problem assets and the impact that they are having on our income. Problem asset resolution is our number one priority, and we are devoting a significant amount of time and effort to identifying and resolving asset quality issues," said Mr. Bradford.
Financial Condition
Total assets grew 5.7 percent from June 30, 2008, reaching $822,678,000 on June 30, 2009. Loans, including loans held for sale, totaled $624,018,000 on June 30, 2009, a 3.6 percent increase from total loans on June 30, 2008, which were $602,369,000. Deposits increased 7.9 percent to $672,992,000 at June 30, 2009 compared to $623,871,000 a year earlier.
About Monroe Bancorp
Monroe Bancorp, headquartered in Bloomington, Indiana, is an Indiana bank holding company with Monroe Bank as its wholly owned subsidiary. Monroe Bank was established in Bloomington in 1892, and offers a full range of financial, trust and investment services through its locations in Central and South Central Indiana. The Company's common stock is traded on the NASDAQ(r) Global Stock Market under the symbol MROE.
The Monroe Bancorp logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4316
See attachments for additional financial information. For further information, contact: Mark D. Bradford, President and Chief Executive Officer, (812) 331-3455.
Use of Non-GAAP Financial Information
To supplement the Company's consolidated condensed financial statements presented on a GAAP basis, the Company has used the following non-GAAP measures of reporting:
(1) The net interest margin is reported on a tax equivalent basis. The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a marginal income tax rate of 34 percent. Management believes that it is a standard practice in the banking industry to present net interest margin and net interest income on a fully tax equivalent basis. Therefore, management believes these measures provide useful information to investors by allowing them to make peer comparisons. A table entitled "Reconciliation of GAAP Net Interest Margin to Non-GAAP Net Interest Margin on a Tax-Equivalent Basis," included at the end of the attached financial summary, reconciles the non-GAAP financial measure "net interest income (tax-equivalent)" with net interest income calculated and presented in accordance with GAAP. The table also reconciles the non-GAAP financial measure "net interest margin (tax-equivalent)" with net interest margin calculated and presented in accordance with GAAP.
(2) Noninterest income and noninterest expense are reported without the effect of income and expenses related to securities held in a rabbi trust for the deferred compensation plan. A table entitled "Reconciliation of GAAP Noninterest Income & Expense to Noninterest Income & Expense Without the Financial Impact of the Deferred Compensation Plan", included at the end of the attached financial summary, details all the items included in noninterest income and expense associated with the deferred compensation plan / rabbi trust and reconciles the GAAP numbers to the non-GAAP numbers. The activity in the rabbi trust has no effect on the Company's net income, therefore, management believes a more accurate comparison of current and prior year noninterest income and noninterest expense can be made if items related to the rabbi trust are removed.
The Company believes these adjustments are appropriate to enhance an overall understanding of the Company's past financial performance and also its prospects for the future. These adjustments to the Company's GAAP results are made with the intent of providing both management and investors a more complete understanding of the underlying operational results and trends and the Company's marketplace performance. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the numbers prepared in accordance with generally accepted accounting principles in the United States.
Forward-Looking Statements
This release contains forward-looking statements about the Company which we believe are within the meaning of the Private Securities Litigation Reform Act of 1995. This release contains certain forward-looking statements with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words "believe," "expect," "anticipate," "intend," "plan," "estimate" or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could" or "may" or words of similar meaning. These forward-looking statements, by their nature, are subject to risks and uncertainties. There are a number of important factors that could cause future results to differ materially from historical performance and these forward-looking statements. Factors that might cause such a difference include, but are not limited to: (1) changes in competitive pressures among depository institutions; (2) changes in the interest rate environment; (3) changes in prepayment speeds, charge-offs and loan loss provisions; (4) changes in general economic conditions, either national or in the markets in which the Company does business; (5) legislative or regulatory changes adversely affecting the business of the Company; (6) changes in real estate values or the real estate markets; and (7) the Company's business development efforts in new markets in and around Hendricks and Hamilton Counties. Further information on other factors which could affect the financial results of the Company is included in the Company's filings with the Securities and Exchange Commission.
Monroe Bancorp (MROE)
Financial Summary
(dollar amounts in thousands except per share data)
------------------------------------------------------
Quarters Ended
------------------------------------------------------
Jun 2009 Mar 2009 Dec 2008 Sep 2008 Jun 2008
------------------------------------------------------
BALANCE SHEET *
---------------------------------------------------------------------
Cash and
Interest-
Earning
Deposits $ 25,030 $ 28,038 $ 15,058 $ 33,675 $ 27,141
---------------------------------------------------------------------
Federal Funds
Sold 30,238 16,150 8,663 26,593 1,654
---------------------------------------------------------------------
Securities 102,291 108,087 121,530 99,795 106,591
---------------------------------------------------------------------
Total Loans 624,018 630,842 633,091 616,226 602,369
---------------------------------------------------------------------
Loans Held
for Sale 8,640 4,659 3,389 2,406 4,110
---------------------------------------------------------------------
Commercial &
Industrial 92,778 103,306 104,779 97,373 99,141
---------------------------------------------------------------------
Real Estate:
---------------------------------------------------------------------
Commercial
& Residen-
tial 393,308 392,414 398,896 368,363 355,393
---------------------------------------------------------------------
Construc-
tion &
Vacant
Land 82,212 84,697 80,917 103,459 99,694
---------------------------------------------------------------------
Home Equity 31,205 29,781 28,976 27,305 25,783
---------------------------------------------------------------------
Installment
Loans 15,875 15,985 16,134 17,320 18,248
---------------------------------------------------------------------
Reserve for
Loan Losses 12,960 12,336 11,172 9,397 7,748
---------------------------------------------------------------------
Bank Premises
and Equipment 20,312 20,605 20,750 20,836 20,534
---------------------------------------------------------------------
Federal Home
Loan Bank
Stock 2,353 2,312 2,312 2,312 2,312
---------------------------------------------------------------------
Interest
Receivable
and Other
Assets 31,396 30,004 29,567 28,969 25,351
---------------------------------------------------------------------
Total
Assets $ 822,678 $ 823,702 $ 819,799 $ 819,009 $ 778,204
---------------------------------------------------------------------
---------------------------------------------------------------------
Total Deposits $ 672,992 $ 676,557 $ 665,179 $ 679,421 $ 623,871
---------------------------------------------------------------------
Noninterest
Checking 83,404 78,676 84,317 88,264 79,548
---------------------------------------------------------------------
Interest
Bearing
Checking &
NOW 214,998 118,421 107,124 125,407 129,422
---------------------------------------------------------------------
Regular
Savings 18,404 17,990 16,619 16,844 17,876
---------------------------------------------------------------------
Money Market
Savings 40,110 122,080 108,246 106,808 116,862
---------------------------------------------------------------------
CDs & CDARs
Less than
$100,000 142,114 149,380 155,127 142,648 139,584
---------------------------------------------------------------------
CDARs Greater
than
$100,000 &
Brokered CDs 65,354 70,612 67,949 23,101 13,101
---------------------------------------------------------------------
CDs Greater
than
$100,000 108,246 119,298 125,741 175,906 127,163
---------------------------------------------------------------------
Other Time 362 101 56 443 315
---------------------------------------------------------------------
Total
Borrowings 86,403 85,070 93,203 75,954 88,723
---------------------------------------------------------------------
Federal Funds
Purchased -- -- -- -- 12,810
---------------------------------------------------------------------
Securities
Sold Under
Repurchase
Agreement 58,737 58,686 59,404 46,569 46,390
---------------------------------------------------------------------
FHLB Advances 17,498 17,511 25,523 20,186 21,249
---------------------------------------------------------------------
Loans Sold
Under Repur-
chase
Agreement &
Other Debt 1,920 625 28 951 26
---------------------------------------------------------------------
Subordinated
Debentures -
Trust
Preferred 8,248 8,248 8,248 8,248 8,248
---------------------------------------------------------------------
Interest
Payable and
Other Liabili-
ties 6,828 6,098 5,496 7,942 9,578
---------------------------------------------------------------------
Total Lia-
bilities 766,223 767,725 763,878 763,317 722,172
---------------------------------------------------------------------
Shareholders'
Equity 56,455 55,977 55,921 55,692 56,032
---------------------------------------------------------------------
Total Lia-
bilities
and Share-
holders'
Equity $ 822,678 $ 823,702 $ 819,799 $ 819,009 $ 778,204
---------------------------------------------------------------------
---------------------------------------------------------------------
Book Value Per
Share $ 9.07 $ 9.00 $ 8.99 $ 8.95 $ 9.01
---------------------------------------------------------------------
End of Period
Shares Issued
and Outstand-
ing 6,227,550 6,227,550 6,227,550 6,227,550 6,227,550
---------------------------------------------------------------------
Less: Unearned
ESOP Shares 4,852 6,226 7,601 5,900 8,300
---------------------------------------------------------------------
End of Period
Shares Used to
Calculate Book
Value 6,222,699 6,221,324 6,219,949 6,221,650 6,219,250
---------------------------------------------------------------------
* period end numbers
---------------------
Years Ended
---------------------
Dec 2008 Dec 2007
---------------------
BALANCE SHEET *
---------------------------------------------------------------------
Cash and Interest-Earning Deposits $ 15,058 $ 24,563
---------------------------------------------------------------------
Federal Funds Sold 8,663 1,077
---------------------------------------------------------------------
Securities 121,530 125,658
---------------------------------------------------------------------
Total Loans 633,091 584,831
---------------------------------------------------------------------
Loans Held for Sale 3,389 2,974
---------------------------------------------------------------------
Commercial & Industrial 104,779 104,611
---------------------------------------------------------------------
Real Estate:
---------------------------------------------------------------------
Commercial & Residential 398,896 332,664
---------------------------------------------------------------------
Construction & Vacant Land 80,917 101,011
---------------------------------------------------------------------
Home Equity 28,976 25,222
---------------------------------------------------------------------
Installment Loans 16,134 18,349
---------------------------------------------------------------------
Reserve for Loan Losses 11,172 6,654
---------------------------------------------------------------------
Bank Premises and Equipment 20,750 20,029
---------------------------------------------------------------------
Federal Home Loan Bank Stock 2,312 2,312
---------------------------------------------------------------------
Interest Receivable and Other Assets 29,567 26,264
---------------------------------------------------------------------
Total Assets $ 819,799 $ 778,080
---------------------------------------------------------------------
---------------------------------------------------------------------
Total Deposits $ 665,179 $ 619,717
---------------------------------------------------------------------
Noninterest Checking 84,317 81,542
---------------------------------------------------------------------
Interest Bearing Checking & NOW 107,124 131,295
---------------------------------------------------------------------
Regular Savings 16,619 17,712
---------------------------------------------------------------------
Money Market Savings 108,246 99,135
---------------------------------------------------------------------
CDs & CDARs Less than $100,000 155,127 150,422
---------------------------------------------------------------------
CDARs Greater than $100,000 & Brokered CDs 67,949 10,034
---------------------------------------------------------------------
CDs Greater than $100,000 125,741 128,602
---------------------------------------------------------------------
Other Time 56 975
---------------------------------------------------------------------
Total Borrowings 93,203 96,421
---------------------------------------------------------------------
Federal Funds Purchased -- 24,850
---------------------------------------------------------------------
Securities Sold Under Repurchase Agreement 59,404 43,195
---------------------------------------------------------------------
FHLB Advances 25,523 18,273
---------------------------------------------------------------------
Loans Sold Under Repurchase Agreement & Other
Debt 28 1,855
---------------------------------------------------------------------
Subordinated Debentures - Trust Preferred 8,248 8,248
---------------------------------------------------------------------
Interest Payable and Other Liabilities 5,496 7,490
---------------------------------------------------------------------
Total Liabilities 763,878 723,628
---------------------------------------------------------------------
Shareholders' Equity 55,921 54,452
---------------------------------------------------------------------
Total Liabilities and Shareholders' Equity $ 819,799 $ 778,080
---------------------------------------------------------------------
---------------------------------------------------------------------
Book Value Per Share $ 8.99 $ 8.76
---------------------------------------------------------------------
End of Period Shares Issued and Outstanding 6,227,550 6,227,550
---------------------------------------------------------------------
Less: Unearned ESOP Shares 7,601 13,100
---------------------------------------------------------------------
End of Period Shares Used to Calculate Book
Value 6,219,949 6,214,450
---------------------------------------------------------------------
* period end numbers
Monroe Bancorp (MROE)
Financial Summary
(dollar amounts in thousands except per share data)
------------------------------------------------------
Quarters Ended
------------------------------------------------------
INCOME
STATEMENT Jun 2009 Mar 2009 Dec 2008 Sep 2008 Jun 2008
---------------------------------------------------------------------
Interest
Income $ 9,177 $ 9,378 $ 10,141 $ 10,472 $ 10,366
---------------------------------------------------------------------
Interest
Expense 3,132 3,436 4,152 4,492 4,610
---------------------------------------------------------------------
Net Interest
Income 6,045 5,942 5,989 5,980 5,756
---------------------------------------------------------------------
Loan Loss
Provision 2,200 2,600 4,150 2,800 1,050
---------------------------------------------------------------------
Total
Noninterest
Income 3,186 3,262 2,096 2,549 3,024
---------------------------------------------------------------------
Service
Charges on
Deposit
Accounts 887 811 946 996 985
---------------------------------------------------------------------
Trust Fees 529 527 553 592 634
---------------------------------------------------------------------
Commission
Income 230 171 201 208 246
---------------------------------------------------------------------
Gain on Sale
of Loans 454 290 141 189 175
---------------------------------------------------------------------
Realized
Gains on
Trading and
Available
for Sale
Securities 364 1,028 175 210 439
---------------------------------------------------------------------
Unrealized
Gains
(Losses) on
Trading
Securities
Associated
with
Directors'
Deferred
Comp Plan 222 (132) (354) (222) (50)
---------------------------------------------------------------------
BOLI Income 163 151 163 141 125
---------------------------------------------------------------------
Other
Operating
Income 337 416 271 435 470
---------------------------------------------------------------------
Total
Noninterest
Expense 6,123 5,223 4,901 5,069 5,371
---------------------------------------------------------------------
Salaries &
Wages 2,073 2,069 2,160 2,175 2,204
---------------------------------------------------------------------
Commissions,
Options &
Incentive
Compensation 458 304 337 339 417
---------------------------------------------------------------------
Employee
Benefits 540 591 343 517 535
---------------------------------------------------------------------
Premises &
Equipment 930 928 826 844 830
---------------------------------------------------------------------
Advertising 160 129 138 187 179
---------------------------------------------------------------------
Legal Fees 111 126 158 121 102
---------------------------------------------------------------------
FDIC expense 650 283 138 140 156
---------------------------------------------------------------------
Appreciation
(Deprecia-
tion) in
Directors'
Deferred
Compensation
Plan 237 (118) (317) (203) (23)
---------------------------------------------------------------------
Other
Operating
Expenses 964 911 1,118 949 971
---------------------------------------------------------------------
Income (Loss)
Before Income
Tax 908 1,381 (966) 660 2,359
---------------------------------------------------------------------
Income Tax
Expense
(Benefit) 132 274 (757) (75) 499
---------------------------------------------------------------------
Net Income
(Loss) After
Tax & Before
Extra-
ordinary Items 776 1,107 (209) 735 1,860
---------------------------------------------------------------------
Extraordinary
Items -- -- -- -- --
---------------------------------------------------------------------
Net Income
(Loss) $ 776 $ 1,107 $ (209)$ 735 $ 1,860
---------------------------------------------------------------------
---------------------------------------------------------------------
Basic Earnings
Per Share $ 0.125 $ 0.178 $ (0.034)$ 0.118 $ 0.299
---------------------------------------------------------------------
Diluted
Earnings Per
Share $ 0.125 $ 0.178 $ (0.034)$ 0.118 $ 0.299
---------------------------------------------------------------------
---------------------
Years Ended
---------------------
INCOME STATEMENT Dec 2008 Dec 2007
---------------------------------------------------------------------
Interest Income $ 42,462 $ 48,474
---------------------------------------------------------------------
Interest Expense 18,861 25,435
---------------------------------------------------------------------
Net Interest Income 23,601 23,039
---------------------------------------------------------------------
Loan Loss Provision 8,880 2,035
---------------------------------------------------------------------
Total Noninterest Income 10,033 10,251
---------------------------------------------------------------------
Service Charges on Deposit Accounts 3,796 3,680
---------------------------------------------------------------------
Trust Fees 2,387 2,243
---------------------------------------------------------------------
Commission Income 874 910
---------------------------------------------------------------------
Gain on Sale of Loans 703 817
---------------------------------------------------------------------
Realized Gains on Trading and Available for
Sale Securities 964 49
---------------------------------------------------------------------
Unrealized Gains (Losses) on Trading
Securities Associated with Directors'
Deferred Comp Plan (843) 17
---------------------------------------------------------------------
BOLI Income 552 489
---------------------------------------------------------------------
Other Operating Income 1,600 2,046
---------------------------------------------------------------------
Total Noninterest Expense 20,732 20,626
---------------------------------------------------------------------
Salaries & Wages 8,743 8,621
---------------------------------------------------------------------
Commissions, Options & Incentive Compensation 1,472 1,737
---------------------------------------------------------------------
Employee Benefits 2,076 1,774
---------------------------------------------------------------------
Premises & Equipment 3,373 3,100
---------------------------------------------------------------------
Advertising 724 667
---------------------------------------------------------------------
Legal Fees 566 566
---------------------------------------------------------------------
FDIC expense 481 67
---------------------------------------------------------------------
Appreciation (Depreciation) in Directors'
Deferred Compensation Plan (707) 267
---------------------------------------------------------------------
Other Operating Expenses 4,004 3,827
---------------------------------------------------------------------
Income Before Income Tax 4,022 10,629
---------------------------------------------------------------------
Income Tax Expense (Benefit) 43 2,823
---------------------------------------------------------------------
Net Income After Tax & Before Extraordinary
Items 3,979 7,806
---------------------------------------------------------------------
Extraordinary Items -- --
---------------------------------------------------------------------
Net Income $ 3,979 $ 7,806
---------------------------------------------------------------------
---------------------------------------------------------------------
Basic Earnings Per Share $ 0.640 $ 1.240
---------------------------------------------------------------------
Diluted Earnings Per Share $ 0.639 $ 1.235
---------------------------------------------------------------------
Monroe Bancorp (MROE)
Financial Summary
(dollar amounts in thousands except per share data)
------------------------------------------------------
Quarters Ended
------------------------------------------------------
ASSET QUALITY Jun 2009 Mar 2009 Dec 2008 Sep 2008 Jun 2008
---------------------------------------------------------------------
Net Charge-Offs
(Recoveries) $ 1,576 $ 1,436 $ 2,375 $ 1,151 $ 575
---------------------------------------------------------------------
OREO Expenses 140 47 121 4 22
---------------------------------------------------------------------
Total Credit
Charges $ 1,716 $ 1,483 $ 2,496 $ 1,155 $ 597
---------------------------------------------------------------------
---------------------------------------------------------------------
Nonperforming
Loans $ 18,576 $ 13,696 $ 14,329 $ 14,000 $ 15,906
---------------------------------------------------------------------
OREO 3,979 3,158 3,257 438 493
---------------------------------------------------------------------
Nonperforming
Assets 22,555 16,854 17,586 14,438 16,399
---------------------------------------------------------------------
90 Day Past Due
Loans Net of
Nonperforming
Loans 404 435 1,194 127 73
---------------------------------------------------------------------
Nonperforming
Assets + 90
Day Past
Due $ 22,959 $ 17,289 $ 18,780 $ 14,565 $ 16,472
---------------------------------------------------------------------
RATIO
ANALYSIS -
CREDIT
QUALITY *
---------------------------------------------------------------------
NCO/Loans 1.01% 0.91% 1.50% 0.75% 0.38%
---------------------------------------------------------------------
Credit Charges/
Loans & OREO 1.09% 0.94% 1.57% 0.75% 0.40%
---------------------------------------------------------------------
Nonperforming
Loans/Loans 2.98% 2.17% 2.26% 2.27% 2.64%
---------------------------------------------------------------------
Nonperforming
Assets/Loans &
OREO 3.59% 2.66% 2.76% 2.34% 2.72%
---------------------------------------------------------------------
Nonperforming
Assets/Assets 2.74% 2.05% 2.15% 1.76% 2.11%
---------------------------------------------------------------------
Nonperforming
Assets + 90
Day PD/Assets 2.79% 2.10% 2.29% 1.78% 2.12%
---------------------------------------------------------------------
Reserve/Non-
performing
Loans 69.77% 90.07% 77.97% 67.12% 48.71%
---------------------------------------------------------------------
Reserve/Total
Loans 2.08% 1.96% 1.76% 1.52% 1.29%
---------------------------------------------------------------------
Equity &
Reserves/Non-
performing
Assets 307.76% 405.32% 381.51% 450.82% 388.93%
---------------------------------------------------------------------
OREO/Non-
performing
Assets 17.64% 18.74% 18.52% 3.03% 3.01%
---------------------------------------------------------------------
RATIO
ANALYSIS -
CAPITAL
ADEQUACY *
---------------------------------------------------------------------
Equity/Assets 6.86% 6.80% 6.82% 6.80% 7.20%
--------------------------------------------------------------------
Equity/Loans 9.05% 8.87% 8.83% 9.04% 9.30%
---------------------------------------------------------------------
RATIO
ANALYSIS -
PROFITABILITY
---------------------------------------------------------------------
Return on
Average Assets 0.38% 0.54% -0.10% 0.37% 0.96%
---------------------------------------------------------------------
Return on
Average Equity 5.53% 8.00% -1.49% 5.20% 13.26%
---------------------------------------------------------------------
Net Interest
Margin (Tax-
Equivalent)
(1) 3.21% 3.20% 3.23% 3.31% 3.31%
---------------------------------------------------------------------
---------------------
Years Ended
---------------------
ASSET QUALITY Dec 2008 Dec 2007
---------------------------------------------------------------------
Net Charge-Offs (Recoveries) $ 4,362 $ 1,525
---------------------------------------------------------------------
OREO Expenses 229 67
---------------------------------------------------------------------
Total Credit Charges $ 4,591 $ 1,592
---------------------------------------------------------------------
---------------------------------------------------------------------
Nonperforming Loans $ 14,329 $ 6,938
---------------------------------------------------------------------
OREO 3,257 841
---------------------------------------------------------------------
Nonperforming Assets 17,586 7,779
---------------------------------------------------------------------
90 Day Past Due Loans Net of Nonperforming Loans 1,194 435
---------------------------------------------------------------------
Nonperforming Assets + 90 Day Past Due $ 18,780 $ 8,214
---------------------------------------------------------------------
---------------------------------------------------------------------
RATIO ANALYSIS - CREDIT QUALITY
---------------------------------------------------------------------
NCO/Loans 0.69% 0.26%
---------------------------------------------------------------------
Credit Charges/Loans & OREO 0.72% 0.27%
---------------------------------------------------------------------
Nonperforming Loans/Loans 2.26% 1.19%
---------------------------------------------------------------------
Nonperforming Assets/Loans & OREO 2.76% 1.33%
---------------------------------------------------------------------
Nonperforming Assets/Assets 2.15% 1.00%
---------------------------------------------------------------------
Nonperforming Assets + 90 Day PD/Assets 2.29% 1.06%
---------------------------------------------------------------------
Reserve/Nonperforming Loans 77.97% 95.91%
---------------------------------------------------------------------
Reserve/Total Loans 1.76% 1.14%
---------------------------------------------------------------------
Equity & Reserves/Nonperforming Assets 381.51% 785.53%
---------------------------------------------------------------------
OREO/Nonperforming Assets 18.52% 10.81%
---------------------------------------------------------------------
RATIO ANALYSIS - CAPITAL ADEQUACY *
---------------------------------------------------------------------
Equity/Assets 6.82% 7.00%
---------------------------------------------------------------------
Equity/Loans 8.83% 9.31%
---------------------------------------------------------------------
RATIO ANALYSIS - PROFITABILITY
---------------------------------------------------------------------
Return on Average Assets 0.50% 1.04%
---------------------------------------------------------------------
Return on Average Equity 7.11% 14.79%
---------------------------------------------------------------------
Net Interest Margin (Tax-Equivalent) (1) 3.30% 3.37%
---------------------------------------------------------------------
* Based on period end numbers
(1) Interest income on tax-exempt securities has been adjusted to a
tax-equivalent basis using a marginal income tax rate of 34%.
Reclassification of amounts from prior periods were made to
conform to the September 2007 presentation.
Monroe Bancorp (MROE)
Reconciliation of GAAP Net Interest Margin to Non-GAAP Net Interest
Margin on a Tax-Equivalent Basis
(dollar amounts in thousands except per share data)
------------------------------------------------------
Quarters Ended
------------------------------------------------------
Jun 2009 Mar 2009 Dec 2008 Sep 2008 Jun 2008
---------------------------------------------------------------------
Net Interest
Income $ 6,045 $ 5,942 $ 5,989 $ 5,980 $ 5,756
---------------------------------------------------------------------
Tax Equivalent
Adjustment 95 131 167 166 189
---------------------------------------------------------------------
Net Interest
Income - Tax
Equivalent $ 6,140 $ 6,073 $ 6,156 $ 6,146 $ 5,945
Average Earning
Assets $ 767,876 $ 769,735 $ 759,173 $ 738,927 $ 723,441
---------------------------------------------------------------------
---------------------------------------------------------------------
Net Interest
Margin 3.16% 3.13% 3.14% 3.22% 3.20%
---------------------------------------------------------------------
---------------------------------------------------------------------
Net Interest
Margin - Tax
Equivalent 3.21% 3.20% 3.23% 3.31% 3.31%
---------------------------------------------------------------------
---------------------
Years Ended
---------------------
Dec 2008 Dec 2007
---------------------------------------------------------------------
Net Interest Income $ 23,601 $ 23,039
---------------------------------------------------------------------
Tax Equivalent Adjustment 717 696
---------------------------------------------------------------------
Net Interest Income - Tax Equivalent $ 24,318 $ 23,735
---------------------------------------------------------------------
---------------------------------------------------------------------
Average Earning Assets $ 736,903 $ 703,675
---------------------------------------------------------------------
---------------------------------------------------------------------
Net Interest Margin 3.20% 3.27%
---------------------------------------------------------------------
---------------------------------------------------------------------
Net Interest Margin - Tax Equivalent 3.30% 3.37%
---------------------------------------------------------------------
------------------------------------------------------
Year-to-Date
------------------------------------------------------
Jun 2009 Mar 2009 Dec 2008 Sep 2008 Jun 2008
---------------------------------------------------------------------
Net Interest
Income $ 11,987 $ 5,942 $ 23,601 $ 17,611 $ 11,632
---------------------------------------------------------------------
Tax Equivalent
Adjustment 227 131 717 550 383
---------------------------------------------------------------------
Net Interest
Income - Tax
Equivalent $ 12,214 $ 6,073 $ 24,318 $ 18,161 $ 12,015
---------------------------------------------------------------------
---------------------------------------------------------------------
Average Earning
Assets $ 768,800 $ 769,735 $ 736,903 $ 729,425 $ 724,617
---------------------------------------------------------------------
---------------------------------------------------------------------
Net Interest
Margin 3.14% 3.13% 3.20% 3.23% 3.23%
---------------------------------------------------------------------
---------------------------------------------------------------------
Net Interest
Margin - Tax
Equivalent 3.20% 3.20% 3.30% 3.33% 3.33%
---------------------------------------------------------------------
Monroe Bancorp (MROE)
Financial Impact on Net Income of Deferred Compensation Plan
(dollar amounts in thousands except per share data)
--------------------------------------------------------
Quarters Ended Years Ended
----------------------------------------- -------------
Jun Mar Dec Sep Jun Dec Dec
2009 2009 2008 2008 2008 2008 2007
------------------------------------------------------ -------------
Interest and
Dividend
Income $ 18 $ 18 $ 29 $ 22 $ 23 $ 106 $ 117
------------------------------------------------------ -------------
Realized and
Unrealized
Gains (Losses) 222 (132) (355) (222) (48) (829) 66
------------------------------------------------------ -------------
Other Income -- -- 12 -- 6 30 99
------------------------------------------------------ -------------
Total Income
(Loss) From
Plan: 240 (114) (314) (200) (19) (693) 282
------------------------------------------------------ -------------
------------------------------------------------------ -------------
Change in
Deferred
Compensation
Liability 237 (118) (317) (203) (23) (707) 267
------------------------------------------------------ -------------
Trustee Fees 3 4 3 3 4 14 15
------------------------------------------------------ -------------
Total Expense
of Plan: 240 (114) (314) (200) (19) (693) 282
------------------------------------------------------ -------------
------------------------------------------------------ -------------
Net Impact of
Plan: $ -- $ -- $ -- $ -- $ -- $ -- $ --
------------------------------------------------------ -------------
Reconciliation of GAAP Noninterest Income & Expense to Noninterest
Income & Expense Without the Financial Impact of the Deferred
Compensation Plan
(dollar amounts in thousands except per share data)
--------------------------------------- ----------------
Quarters Ended Years Ended
--------------------------------------- ----------------
Jun Mar Dec Sep Jun Dec Dec
2009 2009 2008 2008 2008 2008 2007
---------------------------------------------------- ----------------
Total
Noninterest
Income $ 3,186 $ 3,262 $ 2,096 $ 2,549 $ 3,024 $10,033 $10,251
----------------------------------------------------- ----------------
Income of
Deferred
Comp Plan
Incl. in
Noninterest
Income 222 (132) (343) (222) (42) (799) 165
----------------------------------------------------- ----------------
Adjusted
Noninterest
Income: 2,964 3,394 2,439 2,771 3,066 10,832 10,086
----------------------------------------------------- ----------------
----------------------------------------------------- ----------------
Total
Noninterest
Expense 6,123 5,223 4,901 5,069 5,371 20,732 20,626
----------------------------------------------------- ----------------
Expense of
Deferred
Compensation
Plan 240 (114) (314) (200) (19) (693) 282
----------------------------------------------------- ----------------
Adjusted
Noninterest
Expense: 5,883 5,337 5,215 5,269 5,390 21,425 20,344
----------------------------------------------------- ----------------
----------------------------------------
Year-to-Date
----------------------------------------
Jun Mar Dec Sep Jun
2009 2009 2008 2008 2008
-----------------------------------------------------
Total
Noninterest
Income $ 6,448 $ 3,262 $10,033 $ 7,937 $ 5,388
-----------------------------------------------------
Income of
Deferred
Comp Plan
Incl. in
Noninterest
Income 90 (132) (799) (456) (234)
-----------------------------------------------------
Adjusted
Noninterest
Income: 6,358 3,394 10,832 8,393 5,622
-----------------------------------------------------
-----------------------------------------------------
Total
Noninterest
Expense 11,346 5,223 20,732 15,830 10,762
-----------------------------------------------------
Expense of
Deferred
Compensation
Plan 126 (114) (693) (380) (179)
-----------------------------------------------------
Adjusted
Noninterest
Expense: 11,220 5,337 21,425 16,210 10,941
-----------------------------------------------------
Monroe Bancorp (MROE)
Select Average Balance Sheet Information
(dollar amounts in thousands except per share data)
------------------------------------------------------
Quarters Ended
---------------------------------------------------------------------
Jun 2009 Mar 2009 Dec 2008 Sep 2008 Jun 2008
---------------------------------------------------------------------
Total Average
Loans $ 628,831 $ 632,878 $ 624,421 $ 609,184 $ 591,310
---------------------------------------------------------------------
Average
Commercial &
Industrial 101,992 103,046 101,347 97,911 99,546
---------------------------------------------------------------------
Average Real
Estate: 510,759 513,886 506,315 493,567 473,521
---------------------------------------------------------------------
Average
Commercial
& Residen-
tial 394,439 397,507 379,409 365,942 344,213
---------------------------------------------------------------------
Average
Construc-
tion &
Vacant
Land 85,310 86,966 98,531 101,162 103,745
---------------------------------------------------------------------
Average
Home
Equity 31,010 29,413 28,375 26,463 25,563
---------------------------------------------------------------------
Average
Installment
Loans 16,080 15,946 16,759 17,706 18,243
---------------------------------------------------------------------
Average Federal
Funds Sold 26,975 16,028 11,444 9,161 3,907
---------------------------------------------------------------------
Average Federal
Home Loan Bank
Stock 2,353 2,312 2,312 2,312 2,312
---------------------------------------------------------------------
---------------------------------------------------------------------
Total Average
Deposits $ 673,216 $ 678,377 $ 669,074 $ 652,031 $ 633,127
---------------------------------------------------------------------
Average
Noninterest
Checking 83,321 79,257 81,805 81,425 79,062
---------------------------------------------------------------------
Average
Interest
Bearing
Checking &
NOW 199,693 113,465 120,196 129,898 126,399
---------------------------------------------------------------------
Average
Regular
Savings 18,538 17,132 16,658 17,733 18,153
---------------------------------------------------------------------
Average
Money Market
Savings 47,434 118,577 104,398 110,292 111,797
---------------------------------------------------------------------
Average CDs
Less than
$100,000 189,998 209,036 197,271 149,907 141,550
---------------------------------------------------------------------
Average CDs
Greater than
$100,000 118,057 125,152 132,340 147,051 139,725
---------------------------------------------------------------------
Average Other
Time 16,175 15,758 16,406 15,725 16,441
---------------------------------------------------------------------
Average Federal
Funds
Purchased 185 974 321 2,892 5,906
---------------------------------------------------------------------
Average
Securities
Sold Under
Repurchase
Agreement 58,783 54,210 55,674 42,768 42,332
---------------------------------------------------------------------
Average FHLB
Advances 17,506 19,364 19,486 21,215 18,005
---------------------------------------------------------------------
---------------------
Years Ended
---------------------
Dec 2008 Dec 2007
---------------------------------------------------------------------
Total Average Loans $ 601,875 $ 564,483
---------------------------------------------------------------------
Average Commercial & Industrial 99,353 99,884
---------------------------------------------------------------------
Average Real Estate: 484,841 446,144
---------------------------------------------------------------------
Average Commercial & Residential 357,018 316,578
---------------------------------------------------------------------
Average Construction & Vacant Land 101,380 104,088
---------------------------------------------------------------------
Average Home Equity 26,443 25,478
---------------------------------------------------------------------
Average Installment Loans 17,681 18,455
---------------------------------------------------------------------
Average Federal Funds Sold 8,754 11,102
---------------------------------------------------------------------
Average Federal Home Loan Bank Stock 2,312 2,312
---------------------------------------------------------------------
---------------------------------------------------------------------
Total Average Deposits $ 649,540 $ 611,907
---------------------------------------------------------------------
Average Noninterest Checking 79,503 77,725
---------------------------------------------------------------------
Average Interest Bearing Checking & NOW 127,282 129,887
---------------------------------------------------------------------
Average Regular Savings 17,618 17,940
---------------------------------------------------------------------
Average Money Market Savings 107,723 101,123
---------------------------------------------------------------------
Average CDs Less than $100,000 159,120 152,609
---------------------------------------------------------------------
Average CDs Greater than $100,000 142,126 118,124
---------------------------------------------------------------------
Average Other Time 16,168 14,499
---------------------------------------------------------------------
Average Federal Funds Purchased 3,149 2,085
---------------------------------------------------------------------
Average Securities Sold Under Repurchase
Agreement 45,686 49,884
---------------------------------------------------------------------
Average FHLB Advances 18,698 19,120
---------------------------------------------------------------------