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Frederick County Bancorp, Inc. Reports Results for the First Quarter 2014

FREDERICK, Md., April 16, 2014 /PRNewswire/ -- Frederick County Bancorp, Inc. (the "Company") (OTCQB Marketplace: FCBI), the parent company for Frederick County Bank ("FCB"), announced today that for the quarter ended March 31, 2014 the Company recorded net income of $525 thousand and diluted earnings per share of $0.34, as compared to net income of $480 thousand and diluted earnings per share of $0.31 recorded for the same quarter of 2013. 

The increase in earnings was due primarily to an increase in net interest income to $2.8 million at March 31, 2014 from $2.6 million for the same period of 2013, partially offset a decrease in total noninterest income to $222 thousand at March 31, 2014 from $249 thousand for the same period in 2013, and an increase in total noninterest expense to $2.3 million at March 31, 2014 from $2.2 million for the same period in 2013. 

Net loan charge-offs for the quarters ended March 31, 2014 and 2013 totaled $40 thousand and $5 thousand, respectively.  There were $42 thousand and $48 thousand in charge-offs in 2014 compared to 2013, which were offset by recoveries of $2 thousand and $5 thousand for the periods ended March 31, 2014 and 2013, respectively. 

The ratio of the allowance for loan losses to total loans stood at 1.34%, 1.55% and 1.35% as of March 31, 2014 and 2013 and December 31, 2013, respectively.  Nonperforming assets stood at $5.4 million, $8.0 million and $5.3 million as of March 31, 2014 and 2013 and December 31, 2013, respectively.  The corresponding nonperforming assets to total assets ratios were 1.61%, 2.50% and 1.67% as of March 31, 2014 and 2013 and December 31, 2013, respectively. 

The Company also reported that, as of March 31, 2014, assets stood at $334.0 million, with total deposits of $282.3 million and gross loans of $252.8 million, representing increases of 4.2%, 2.9%, and 9.6%, respectively, compared to March 31, 2013.  Total shareholders' equity at March 31, 2014 was $26.7 million, an increase of $490 thousand from December 31, 2013.  The increase primarily resulted from the expenditures to repurchase 10,000 shares of common stock in the aggregate amount of $162 thousand and dividends declared in the aggregate amount of $102 thousand, offsetting net income of $525 thousand, the decline in the unrealized loss on available for sale securities in the amount of $217 thousand and proceeds from the exercise of options in the amount of $6 thousand.  On a per share basis, book value per share increased by forty-five cents for 2014 to $18.09 per share at March 31, 2014 from $17.64 per share at December 31, 2013.  The dividends declared per share increased by two cents in 2014 to $0.07 per share at March 31, 2014 compared to the $0.05 declared in the same period in 2013.

Frederick County Bank is headquartered in Frederick, Maryland, and conducts full service commercial banking services through five bank centers, four of which are located in the City of Frederick and one in Walkersville, Maryland.

 



March 31,

March 31,


December 31,


2014

2013


2013

(dollars in thousands)

(unaudited)

(unaudited)


(audited)

Total assets

$333,984

$320,612


$318,131

Loans

252,819

230,660


253,913

Deposits

282,310

274,222


266,988

Shareholders' equity

26,677

26,567


26,187






Nonperforming assets:





Nonaccrual loans

$3,204

$3,951


$3,379

Accruing troubled debt restructurings

1,214

2,044


976

Loans 90 days or more past due and still accruing

-

-


-

Foreclosed properties

972

2,048


972

Total nonperforming assets

$5,390

$8,043


$5,327







For the Three Months Ended




March 31,

March 31,




2014

2013



(dollars in thousands, except for per share data)

(unaudited)

(unaudited)



SUMMARY OF OPERATING RESULTS:





Net income

$ 525

$480



Total comprehensive income                                           

$ 742

$369








Charge-offs

$42

$48



(Recoveries)

(2)

(43)



Net charge-offs

$40

$  5








PER COMMON SHARE DATA:





Basic earnings per share

$0.36

$0.32



Diluted earnings per share

$0.34

$0.31



Basic weighted average number of shares outstanding

1,475,218

1,508,574



Diluted weighted average number of shares outstanding

1,522,238

1,542,575



Common shares outstanding

1,474,674

1,508,574


1,484,174

Dividends declared

$0.07

$0.05



Book value per share

$18.09

$17.61


$17.64






SELECTED UNAUDITED FINANCIAL RATIOS:





Return on average assets

0.64%

0.61%



Return on average equity

7.88%

7.20%



Allowance for loan losses to total loans

1.34%

1.55%


1.35%

Nonperforming assets to total assets

1.61%

2.50%


1.67%

Ratio of net charge-offs to average loans

0.02%

0.00%



Tier 1 capital to risk-weighted assets

11.96%

12.47%


11.83%

Total capital to risk-weighted assets

13.19%

13.72%


13.07%

Tier 1 capital to average assets

10.12%

10.20%


10.29%

Average equity to average assets

8.16%

8.44%



Net interest margin

3.76%

3.66%



 

 

Frederick County Bancorp, Inc. and Subsidiaries





Consolidated Balance Sheets












March 31,

March 31,

 December 31,



2014

2013

2013



(unaudited)

(unaudited)

(audited)

(dollars in thousands)





ASSETS 





Cash and due from banks


$    2,251

$   2,342

$   1,922

Federal funds sold


22

25

22

Interest-bearing deposits in other banks


35,911

37,933

18,166

       Cash and cash equivalents


38,184

40,300

20,110

Investment securities available-for-sale at fair value


26,323

32,094

27,016

Restricted stock 


1,580

1,444

1,669

Loans


252,819

230,660

253,913

Less: Allowance for loan losses


(3,384)

(3,565)

(3,423)

       Net loans


249,435

227,095

250,490

Bank premises and equipment


6,541

6,688

6,570

Bank owned life insurance


8,100

7,851

8,040

Foreclosed properties


972

2,048

972

Other assets


2,849

3,092

3,264

       Total assets


$333,984

$320,612

$318,131






LIABILITIES AND SHAREHOLDERS' EQUITY










Liabilities





Deposits





  Noninterest-bearing deposits


$  55,629

$  51,764

$  50,286

  Interest-bearing deposits


226,681

222,458

216,702

       Total deposits


282,310

274,222

266,988

Short-term borrowings


3,050

2,700

3,050

FHLB advances


15,000

10,000

15,000

Junior subordinated debentures


6,186

6,186

6,186

Accrued interest and other liabilities


761

937

720

       Total liabilities


307,307

294,045

291,944






Shareholders' Equity





Common stock, per share par value $0.01; 

   10,000,000 shares authorized; 1,474,674; 1,508,574

   and 1,484,174 shares issued and  outstanding


15

15

15

Additional paid-in capital


15,152

15,680

15,302

Retained earnings


11,879

10,515

11,456

Accumulated other comprehensive (loss) income


(369)

357

(586)

       Total shareholders' equity


26,677

26,567

26,187

       Total liabilities and shareholders' equity


$333,984

$320,612

$318,131






 

Frederick County Bancorp, Inc. and Subsidiaries

Consolidated Statements of Income (Unaudited)


 

For the Three Months Ended

(dollars in thousands, except per share amounts)

March 31,

2014

March 31,

2013

Interest income



  Interest and fees on loans

$3,049

$2,879

  Interest and dividends on investment securities:



    Interest – taxable

91

95

    Interest – tax exempt

50

67

    Dividends

20

15

  Other interest income

15

18

    Total interest income

3,225

3,074

Interest expense



  Interest on deposits

289

327

  Interest on short-term borrowings

19

17

  Interest on FHLB advances

82

79

  Interest on junior subordinated debentures

29

29

    Total interest expense

419

452

Net interest income

2,806

2,622

Provision for loan losses

-

-

Net interest income after provision for loan losses 

2,806

2,622

Noninterest income



  Gain on sale of foreclosed properties

-

28

  Bank owned life insurance income

60

63

  Service fees

81

86

  Other operating income

81

72

    Total noninterest income

222

249

Noninterest expense



  Salaries and employee benefits

1,292

1,270

  Occupancy and equipment expenses

372

355

  Other operating expenses

599

602

    Total noninterest expense

2,263

2,227

Income before provision for income taxes

765

644

Provision for income taxes

240

164

Net income

$   525

$   480

Basic earnings per share

$0.36

$0.32

Diluted earnings per share

$0.34

$0.31

Basic weighted average number of shares outstanding

1,475,218

1,508,574

Diluted weighted average number of shares outstanding

1,522,238

1,542,575

Dividends declared per share

$0.07

$0.05

 

Frederick County Bancorp, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income (Unaudited)



 

Three Months Ended

(dollars in thousands)


 

March 31,

 2014

 

March 31,

 2013

Net income


$525

$480

Changes in net unrealized gains (losses) on securities available for

   sale, net of  income taxes of $141 in 2014 and net of income tax 
   benefits of $72 in 2013


 

 

217

 

 

(111)

    Total comprehensive income


$742

$369

 

Frederick County Bancorp, Inc. and Subsidiaries

Consolidated Statement of Changes in Shareholders' Equity (Unaudited)

 









(dollars in thousands)

Shares

Outstanding

Common

Stock

Additional
Paid-in

Capital

 

Retained

Earnings

Accumulated

Other

Comprehensive

Income

 (Loss)

Total

Shareholders'

Equity








Balance, January 1, 2013

1,508,574

$15

$15,663

$10,110

$468

$26,256

Comprehensive income




480

(111)

369

Dividends declared on common stock, 
   $0.05 per share




(75)


(75)

Compensation expense from stock option 
  transactions



17



17

Balance, March 31, 2013

1,508,574

$15

$15,680

$10,515

$357

$26,567

Balance, January 1, 2014

1,484,174

$15

$15,302

$11,456

$(586)

$26,187

Comprehensive income




525

217

742

Dividends paid on common stock,

   $0.07 per share




(102)


(102)

Shares repurchased

(10,000)


(162)



(162)

Shares issued under stock option
   transactions

500


6



6

Compensation expense from stock option
   transactions



6



6

Balance, March 31, 2014

1,474,674

$15

$15,152

$11,879

$(369)

$26,677

 

Frederick County Bancorp, Inc. and Subsidiaries

Consolidated Statements of Cash Flows (Unaudited)




Three Months Ended


March 31,

2014

March  31,

2013

(dollars in thousands)



Cash flows from operating activities:



   Net income

$525

$480

      Adjustments to reconcile net income to net cash provided by

         operating activities:



           Depreciation and amortization

84

94

           Deferred income (benefits) taxes

(15)

196

           Net premium amortization on investment securities

48

97

           Bank owned life insurance income

(60)

(63)

           Gain on sale of foreclosed properties

--

(28)

           Stock-based compensation expense

6

17

           Decrease in accrued interest and other assets

290

40

           Increase (decrease)  in accrued interest and other liabilities

41

(195)

             Net cash provided by operating activities

919

638

Cash flows from investing activities:



   Proceeds from maturities, prepayments and calls

      investment securities available for sale

1,003

2,414

   Redemption of restricted stock

89

60

   Net decrease (increase) in loans

1,054

(1,377)

   Purchases of bank premises and equipment

(55)

(48)

   Proceeds from sale of foreclosed properties

--

28

            Net cash provided by investing activities

2,091

1,077

Cash flows from financing activities:



   Net increase in NOW, money market accounts, savings  

     accounts and  noninterest-bearing deposits

17,118

10,626

   Net decrease in time deposits

(1,796)

(4,517)

   Proceeds from issuance of common stock

6

--

   Repurchase of common stock

(162)

--

   Dividends paid on common stock

(102)

(75)

            Net cash provided by financing activities

15,064

6,034

Net increase in cash and cash equivalents

18,074

7,749

Cash and cash equivalents – beginning of year

20,110

32,551

Cash and cash equivalents – end of year

$38,184

$40,300

Supplemental cash flow disclosures:



   Interest paid

$413

$447

   Income taxes paid

$--

$145

 


Distribution of Assets, Liabilities and Shareholders' Equity; Interest Rates and Interest Differential

The following tables show average balances of asset and liability categories, interest income and interest expense, and average yields and rates for the periods indicated.   

 

Three Months Ended March 31,

2014

2013

 

 

(dollars in thousands)

Average

daily

balance

Interest

Income/

Expense

Average

Yield/

rate

Average

daily

balance

Interest

Income/

Expense

Average

Yield/

rate

Assets







Interest-earning assets:







  Federal funds sold

$         22

$       -

-%

$            1

$       -

-%

  Interest bearing deposits in other banks

27,794

15

0.22

32,458

18

0.22

  Investment securities (1):







    Taxable

21,849

111

2.06

26,174

110

1.70

    Tax-exempt (2)

6,557

76

4.69

8,613

102

4.80

  Loans (3)

253,041

3,084

4.94

230,092

2,908

5.13

    Total interest-earning assets

309,263

3,286

4.31

297,338

3,318

4.28

Noninterest-earning assets

17,243



18,359



    Total assets

$326,506



$315,697










Liabilities and Shareholders' Equity







Interest-bearing liabilities:







   NOW accounts

$  20,072

7

0.14%

$  17,970

3

0.18%

   Savings accounts

7,950

--

0.03

6,847

1

0.06

   Money market accounts

98,311

69

0.28

88,180

77

0.35

   Certificates of deposit







      $100,000 or more

43,572

111

1.03

48,049

117

0.99

   Certificates of deposit







      less than $100,000

53,135

102

0.66

58,894

124

0.85

   Short-term borrowings

3,050

19

2.53

2,700

17

2.55

   FHLB advances

15,000

82

2.22

10,000

79

3.20

   Junior subordinated debentures

6,186

29

1.90

6,186

29

1.90

  Total interest-bearing liabilities

257,276

419

0.66

238,453

452

0.77

Noninterest-bearing deposits

51,986



49,663



Noninterest-bearing liabilities

590



925



   Total liabilities

309,852



289,041



   Total shareholders' equity

26,654



26,656



   Total liabilities and shareholders'    

     equity

$326,506



$315,697



Net interest income


$2,867



$2,686


Net interest spread



3.65%



3.51%

Net interest margin



3.76%



3.66%

(1)

Yields on securities available-for-sale have been calculated on the basis of historical cost and do not give effect to changes in the fair value of those securities, which is reflected as a component of shareholders' equity.

(2)

Presented on a taxable-equivalent basis using the statutory federal income tax rate of 34%.  Taxable-equivalent adjustments of $26 thousand in 2014 and $35 thousand in 2013 are included in the calculation of the tax-exempt investment interest income.

(3)

Presented on a taxable-equivalent basis using the statutory federal income tax rate of 34%.  Taxable-equivalent adjustments of $35 thousand in 2014 and $29 thousand in 2013 are included in the calculation of the loan interest income.  Net loan origination income in interest income totaled $17 thousand in 2014 and $11 thousand in 2013.



The statements in this press release that are not historical facts constitute "forward-looking statements" as defined by Federal securities laws.  Forward-looking statements can generally be identified by the use of forward- looking terminology such as "believes," "expects," "intends," "may," "will," "should," "anticipates" or similar terminology.  Such statements, specifically regarding the Company's intentions regarding growth and market expansion, are subject to risks and uncertainties that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, changes in interest rates, deposit flows, loan demand and real estate values, as well as changes in economic, competitive, governmental, regulatory, technological and other factors which may affect the Company specifically, its existing and target market areas or the banking industry generally.  Forward-looking statements speak only as of the date they are made.  The Company will not update forward-looking statements to reflect factual assumptions, circumstances or events that have changed after a forward-looking statement was made.

SOURCE Frederick County Bancorp, Inc.

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