BOWIE, Md., Feb. 23, 2009 (GLOBE NEWSWIRE) -- James W. Cornelsen, President and Chief Executive Officer of Old Line Bancshares, Inc. (Nasdaq:OLBK), the parent company of Old Line Bank, reported that net income increased $173,009 or 10.93% for the year ended December 31, 2008 to $1,756,118 from $1,583,109 in 2007. After inclusion of the dividends and accretion on the preferred stock issued under the U.S. Treasury Department's Capital Purchase Program in December 2008, net income available to common shareholders increased $143,680 or 9.08% for the twelve month period to $1,726,789 or $0.44 per basic and diluted common share. Net income for the three month period ended December 31, 2008 declined $138,300 and net income available to common shareholders for the three month period was $351,739 or $0.09 per basic and diluted common share. This represented a decrease of $167,629 or 32.28% compared to net income of $519,368 or $0.13 per basic and diluted common share for the three months ended December 31, 2007. The 10.93% increase in net income for the twelve month period was primarily a result of a $29.2 million or 14.46% increase in net loans during the period. The $138,300 decline in net income for the three month period was primarily the result of the opening of the Annapolis branch in September 2008 and because we maintained significant liquidity during the period. Total assets increased $72.5 million or 29.57% to $317.7 million on December 31, 2008 compared to the December 31, 2007 level of $245.2 million.
Mr. Cornelsen stated: "I am pleased to report improved net income, significant loan and asset growth for the twelve month period and the opening of our 7th branch in College Park, Maryland and our 8th branch in Annapolis during the period. We were able to accomplish these results, during a period of unprecedented economic turmoil that has caused significant turbulence in the financial markets. I believe that the experience of our management and staff, our conservative underwriting standards, and our focus on relationship banking, have allowed us to perform at the top tier of our industry. We ended the quarter with the same non-performing loan totaling approximately $935,000 that we have reported in prior periods and no other loans 30 or more days past due.
"In December, we received a $7 million investment from the U.S. Treasury as part of the federal government's TARP Capital Purchase Program. We sold Senior Preferred shares and warrants to purchase common stock to the U.S. Treasury for $7 million. At that time, information provided by the Treasury indicated that it had designed the program to provide additional capital to healthy institutions, to provide liquidity to the credit markets, and to stabilize our financial markets. We have used and expect to use this capital to support our loan growth. At December 31, 2008, Old Line Bank remained well capitalized with a Tier 1 capital ratio of 16.03% and a total risk based capital ratio of 16.84%"
Mr. Cornelsen also said that, "During this period of economic stress, we have continued to closely monitor our investment portfolio. This portfolio consists primarily of investment grade instruments issued by the U.S. government, government sponsored entities and municipalities. We do not have any investments that consist of sub-prime mortgages. We also do not have any investments in trust preferred securities in our portfolio."
As a result of the growth in our loan portfolio and continued deterioration in the economy, we increased the provision for loan losses 30.5% or $97,000 during the twelve month period. Although we do not expect that all of our customers will remain immune from the economic difficulties apparent in our marketplace, but because we have still not experienced any deterioration in asset quality or had any significant historical losses in our loan portfolio, we decreased the loan loss provision $42,000 in the fourth quarter of 2008 relative to the fourth quarter of 2007. The decline in non interest revenue during the twelve month period was a result of the closing of the marine division at the end of the third quarter of 2007. Non-interest expense increased $598,227 (8.83%) for the twelve month period and $501,503 (32.05%) for the three month period. These increases were the result of the opening of our new College Park branch in February 2008, the expenses associated with the operations of our Greenbelt branch that we opened in June 2007 and the opening of our Annapolis branch in September 2008.
In November 2008, we also acquired an additional 12.5% membership interest in Pointer Ridge Office Investments, LLC. This purchase increased our ownership percentage in the entity from 50.0% to 62.5%. As a result, we now consolidate their financial results with ours and make the appropriate minority interest adjustments. This purchase had a nominal impact on net income during the period.
At December 31, 2008, the allowance for loan losses was $2.0 million or 0.85% of gross loans compared to $1.6 million or 0.78% of gross loans at December 31, 2007. Historically, we have had minimal past dues and charge-offs. Based on our history, internal analysis and the satisfactory historical performance of the loan portfolio, we believe this allowance appropriately reflects the inherent risk of loss in our portfolio.
Old Line Bancshares, Inc. is the parent company of Old Line Bank, a Maryland chartered commercial bank headquartered in Bowie, Maryland, approximately 10 miles east of Andrews Air Force Base and 20 miles east of Washington, D.C. Old Line Bank also operates from a branch in Bowie, Maryland, two branches in Waldorf, Maryland, one branch in Annapolis, Maryland and four additional branches in Prince George's County, Maryland. Its primary market area is the suburban Maryland (Washington, D.C. suburbs) counties of Prince George's, Anne Arundel, Charles and northern St. Mary's. It also targets customers throughout the greater Washington, D.C. metropolitan area.
The statements in this press release that are not historical facts, in particular with respect to our plans to use the capital received under the Capital Purchase Program to support loan growth, constitute "forward-looking statements" as defined by Federal Securities laws. Such statements 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. These statements can generally be identified by the use of forward-looking terminology such as "believes," "expects," "intends," "may," "will," "should," "anticipates", "plans" or similar terminology. Actual results could differ materially from those currently anticipated due to a number of factors, including, but not limited to: changes in interest rates and changes in economic, competitive, governmental, regulatory, technological or other factors that could affect Old Line Bancshares, Inc.'s business plans or competitive position or that otherwise require us to re-direct our focus and resources to other areas of our business than currently planned, whether they affect Old Line Bancshares, Inc. specifically or the banking industry generally. Forward-looking statements speak only as of the date they are made. Old Line Bancshares, Inc. will not update forward-looking statements to reflect factual assumptions, circumstances or events that have changed after a forward-looking statement was made. For further information regarding risks and uncertainties that could affect forward-looking statements Old Line Bancshares, Inc. may make, please refer to the filings made by Old Line Bancshares, Inc. with the U.S. Securities and Exchange Commission available at www.sec.gov.
Old Line Bancshares, Inc. & Subsidiary
Consolidated Balance Sheets
December 31, December 31,
2008 2007
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(Unaudited)
Assets
Cash and due from banks $ 8,823,170 $ 3,172,089
Federal funds sold 2,140,525 9,822,079
------------ ------------
Total cash and cash equivalents 10,963,695 12,994,168
Time deposits in other banks 13,267,000 2,000,000
Investment securities available for sale 29,565,976 9,393,356
Investment securities held to maturity 8,003,391 2,301,591
Loans, less allowance for loan losses 231,053,618 201,941,667
Restricted equity securities at cost 2,126,550 2,080,250
Investment in real estate LLC -- 805,971
Bank premises and equipment 12,388,046 4,207,395
Accrued interest receivable 1,091,560 918,078
Income tax receivable 35,649 --
Deferred income taxes -- 161,940
Bank owned life insurance 8,096,039 7,769,290
Other assets 1,139,101 637,570
------------ ------------
$317,730,625 $245,211,276
============ ============
Liabilities and Stockholders' Equity
Deposits
Noninterest-bearing $ 39,880,119 $ 35,141,289
Interest-bearing 191,550,521 142,670,944
------------ ------------
Total deposits 231,430,640 177,812,233
Short-term borrowings 17,773,934 16,347,096
Long-term borrowings 21,531,133 15,000,000
Accrued interest payable 625,446 693,868
Income tax payable -- 238,226
Deferred income taxes 65,651 --
Other liabilities 4,012,968 488,599
------------ ------------
275,439,772 210,580,022
Minority Interest 604,011 --
Stockholders' equity
Preferred stock, par value $0.01 per
share and additional paid in capital;
7,000 shares issued and outstanding 6,703,591 --
Common stock, par value $.01 per share;
authorized 15,000,000 shares; issued
and outstanding 3,862,364 in 2008,
and 4,075,849 in 2007 38,624 40,758
Additional paid-in capital 28,838,810 30,465,013
Warrants to purchase 143,247 shares of
common stock 301,434 --
Retained earnings 5,411,772 4,155,232
------------ ------------
41,294,231 34,661,003
Accumulated other comprehensive income 392,611 (29,749)
------------ ------------
41,686,842 34,631,254
$317,730,625 $245,211,276
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Old Line Bancshares, Inc. & Subsidiary
Consolidated Statements of Income
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008
(Unaudited) (Unaudited) (Unaudited) 2007
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Interest revenue
Loans, including
fees $ 3,620,185 $ 3,557,578 $14,240,545 $12,768,154
U.S. Treasury
securities 10,842 26,260 69,079 115,597
U.S. government
agency securities 91,766 57,331 181,792 288,161
Mortgage backed
securities 147,345 10,499 356,398 48,946
Municipal
securities 23,128 26,954 95,822 107,852
Federal funds
sold 28,540 91,693 285,619 1,116,822
Other 69,768 46,630 194,981 108,826
----------- ----------- ----------- -----------
Total interest
revenue 3,991,574 3,816,945 15,424,236 14,554,358
----------- ----------- ----------- -----------
Interest expense
Deposits 1,328,017 1,440,515 5,101,608 5,689,554
Borrowed funds 215,112 153,283 808,127 573,405
----------- ----------- ----------- -----------
Total interest
expense 1,543,129 1,593,798 5,909,735 6,262,959
----------- ----------- ----------- -----------
Net interest
income 2,448,445 2,223,147 9,514,501 8,291,399
Provision for loan
losses 70,000 112,000 415,000 318,000
----------- ----------- ----------- -----------
Net interest
income after
provision for
loan losses 2,378,445 2,111,147 9,099,501 7,973,399
----------- ----------- ----------- -----------
Non-interest revenue
Service charges on
deposit accounts 80,531 72,113 311,268 292,610
Marine division
broker origination
fees -- 10,131 -- 272,349
Earnings on bank
owned life
insurance 93,176 92,723 366,785 340,853
Income (loss) on
investment in
real estate LLC (2,163) 23,844 3,741 24,100
Other fees and
commissions 90,180 59,669 282,138 243,402
----------- ----------- ----------- -----------
Total non-
interest
revenue 261,724 258,480 963,932 1,173,314
----------- ----------- ----------- -----------
Non-interest expense
Salaries 1,007,457 639,839 3,316,219 3,045,932
Employee benefits 199,701 204,036 923,666 953,554
Occupancy 287,400 258,008 1,124,838 934,277
Equipment 84,696 63,583 313,133 248,182
Data processing 76,590 55,722 269,632 221,107
Other operating 410,468 343,621 1,425,290 1,371,499
----------- ----------- ----------- -----------
Total non-
interest
expense 2,066,312 1,564,809 7,372,778 6,774,551
----------- ----------- ----------- -----------
Minority interest (4,846) -- (4,846) --
Income before
income taxes 578,703 804,818 2,695,501 2,372,162
Income taxes 197,635 285,450 939,383 789,053
----------- ----------- ----------- -----------
Net income 381,068 519,368 1,756,118 1,583,109
----------- ----------- ----------- -----------
Preferred stock
dividends and
discount accretion 29,329 -- 29,329 --
----------- ----------- ----------- -----------
Net income
available to
common
shareholders $ 351,739 $ 519,368 $ 1,726,789 $ 1,583,109
=========== =========== =========== ===========
Basic earnings
per common share $ 0.09 $ 0.13 $ 0.44 $ 0.37
Diluted earnings
per common share $ 0.09 $ 0.13 $ 0.44 $ 0.37