EXHIBIT 99.1
| PRESS RELEASE | OLD LINE BANCSHARES, INC. |
| FOR IMMEDIATE RELEASE | CONTACT: |
| October 27, 2006 | CHRISTINE M. RUSH |
| CHIEF FINANCIAL OFFICER | |
| (301) 430-2544 |
OLD LINE BANCSHARES, INC.’S NINE MONTH NET INCOME RISES 60.75 PERCENT
BOWIE, MD. (NASDAQ CAPITAL MARKET: OLBK)-James W. Cornelsen, President and Chief Executive Officer of Old Line Bancshares, Inc., the parent company of Old Line Bank, reported that net income was $1,206,819 or $0.28 basic and diluted earnings per common share for the nine month period ending September 30, 2006. This represented an increase of $456,064 or 60.75% compared to net income of $750,755 or $0.35 basic and diluted earnings per common share for the same period in 2005. The 2,096,538 additional shares issued during the capital offering in October 2005 negatively impacted earnings per share. Net income for the three month period ended September 30, 2006 increased $135,353 or 48.12% to $416,624 compared to $281,271 for the same period in 2005. Total assets were $180.2 million on September 30, 2006. This represented an $11.2 million or 6.63% increase over the December 31, 2005 level of $169.0 million.
Mr. Cornelsen stated: “I am pleased to report continuing strong financial performance for the first nine months and the third quarter of 2006. On July 10th, we moved into our new corporate headquarters and opened our 5th branch location at 1525 Pointer Ridge Place, Bowie, Maryland. In July, we also hired Wendi M. Williams as Vice President of Business Development. In August, we hired Ed Harrington as Vice President of Commercial Lending. Mr. Harrington has over 30 years of lending experience and is a significant enhancement to our lending team. We anticipate, his expertise and market knowledge will allow us to expand our presence into southern Montgomery County and the District of Columbia.
As a result of these investments in infrastructure during the third quarter, we had an approximately $140,000 increase in occupancy and related expenses and we incurred an additional $40,000 in expenses associated with the move. In spite of these increases in expenses, we are able to report a 60.75% increase in net income for the nine months and a 48.12% increase in net income for the three months ended September 30, 2006.
This exemplary performance is primarily attributable to our success in increasing interest and noninterest revenue. Because of the hard work and dedication of the team of lenders located in the College Park office that we opened in August 2005, and the efforts of the rest of our staff, we have seen 31.47% or $32.8 million of growth in loans since December 31, 2005. At September 30, 2006, the loan portfolio was $137.1 million compared to $104.2 million at December 31, 2005. We have accomplished this growth while maintaining sound risk management practices. As a result, asset quality remains excellent and we ended the quarter with no loans 90 days past due or non-performing. The allowance for loan losses was $1.2 million or 0.91% of gross loans at September 30, 2006, compared to $954,706 or 0.91% of gross loans at December 31, 2005. The continued deployment of the offering proceeds into loans, coupled with rising interest rates and a favorable deposit mix, improved our net interest margin from 3.90% for the nine months ended September 30, 2005 to 4.33% for the nine months ended September 30, 2006.
Our biggest challenge during the third quarter was growing deposits. Because of the slowdown in sales of homes in our primary market area during the third quarter, we experienced declines in balances in title company and real estate related business accounts relative to the second quarter.
The marine division that we established in February 2005 increased its broker origination fees $193,443 during the nine month period and $26,717 for the three month period ended September 30, 2006. Pointer Ridge, a real estate LLC in which we have a 50% investment, has leased 95% of the building it owns and our earnings on this investment were approximately $77,000 during the nine and three month period.”
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 and two branches in Prince George’s County, Maryland. Its primary market area is the suburban Maryland (Washington, D.C. suburbs) counties of Prince George’s, 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 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” or similar terminology. These forward-looking statements may include, among others, statements regarding future growth. Actual results could differ materially from those currently anticipated due to a number of factors, including, but not limited to: changes in our competitive environment; unanticipated changes in Old Line Banchshares, Inc.’s business or operations that require us to re-direct our focus and resources to other areas of our business than currently planned; changes in regulatory requirements and/or restrictive banking legislation that may adversely affect Old Line Bancshares, Inc. and changes in economic, governmental, technological and other factors which may 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 | |||||||
Assets | |||||||
September 30, 2006 | December 31, 2005 | ||||||
(Unaudited) | |||||||
| Cash and due from banks | $ | 3,490,988 | $ | 4,387,676 | |||
| Federal funds sold | 11,585,646 | 35,573,704 | |||||
| Total cash and cash equivalents | 15,076,634 | 39,961,380 | |||||
| Investment securities available for sale | 14,609,694 | 13,926,111 | |||||
| Investment securities held to maturity | 2,802,591 | 2,203,445 | |||||
| Loans, less allowance for loan losses | 137,055,283 | 104,249,383 | |||||
| Restricted equity securities at cost | 1,575,550 | 1,102,750 | |||||
| Investment in real estate, LLC | 914,964 | 837,436 | |||||
| Bank premises and equipment | 3,579,244 | 2,436,652 | |||||
| Accrued interest receivable | 739,585 | 504,299 | |||||
| Deferred income taxes | 185,933 | 200,663 | |||||
| Bank owned life insurance | 3,424,702 | 3,324,660 | |||||
| Other assets | 276,379 | 281,045 | |||||
| $ | 180,240,559 | $ | 169,027,824 | ||||
Liabilities and Stockholders' Equity | |||||||
| Deposits | |||||||
| Non-interest-bearing | $ | 31,704,955 | $ | 30,417,858 | |||
| Interest bearing | 98,719,915 | 89,253,741 | |||||
| Total deposits | 130,424,870 | 119,671,599 | |||||
| Short-term borrowings | 9,191,629 | 9,292,506 | |||||
| Long-term borrowings | 5,000,000 | 6,000,000 | |||||
| Accrued interest payable | 427,994 | 336,868 | |||||
| Income tax payable | 206,168 | 86,151 | |||||
| Other liabilities | 466,927 | 124,873 | |||||
| 145,717,588 | 135,511,997 | ||||||
| Stockholders' equity | |||||||
Common stock, par value $0.01 per share, authorized 15,000,000 shares in 2006 and 5,000,000 shares in 2005; issued and outstanding 4,250,098.5 in 2006 and 4,248,898.5 in 2005 | 42,501 | 42,489 | |||||
| Additional paid-in capital | 31,828,570 | 31,735,627 | |||||
| Retained earnings | 2,837,891 | 1,992,301 | |||||
| 34,708,962 | 33,770,417 | ||||||
| Accumulated other comprehensive income | (185,991 | ) | (254,590 | ) | |||
| 34,522,971 | 33,515,827 | ||||||
| $ | 180,240,559 | $ | 169,027,824 | ||||
Old Line Bancshares, Inc. & Subsidiary | |||||||||||||
Consolidated Statements of Income | |||||||||||||
(Unaudited) | |||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
2006 | 2005 | 2006 | 2005 | ||||||||||
Interest revenue | |||||||||||||
| Loans, including fees | $ | 2,467,945 | $ | 1,520,876 | $ | 6,418,661 | $ | 4,109,013 | |||||
| U.S. Treasury securities | 31,899 | 31,899 | 95,239 | 95,238 | |||||||||
| U.S. government agency securities | 65,658 | 58,586 | 183,035 | 177,949 | |||||||||
| Mortgage backed securities | 15,936 | 20,071 | 50,005 | 66,040 | |||||||||
| Tax exempt securities | 27,509 | 28,099 | 83,601 | 85,767 | |||||||||
| Federal funds sold | 190,922 | 128,607 | 952,888 | 309,596 | |||||||||
| Other | 20,556 | 10,365 | 59,303 | 35,192 | |||||||||
| Total interest revenue | 2,820,425 | 1,798,503 | 7,842,732 | 4,878,795 | |||||||||
Interest expense | |||||||||||||
| Deposits | 786,304 | 489,686 | 2,136,419 | 1,228,881 | |||||||||
| Borrowed funds | 145,822 | 90,210 | 374,763 | 232,721 | |||||||||
| Total interest expense | 932,126 | 579,896 | 2,511,182 | 1,461,602 | |||||||||
| Net interest income | 1,888,299 | 1,218,607 | 5,331,550 | 3,417,193 | |||||||||
Provision for loan losses | 26,000 | 40,000 | 296,000 | 165,000 | |||||||||
| Net interest income after provision for loan losses | 1,862,299 | 1,178,607 | 5,035,550 | 3,252,193 | |||||||||
Non-interest revenue | |||||||||||||
| Service charges on deposit accounts | 67,339 | 62,237 | 195,693 | 179,740 | |||||||||
| Marine division broker origination fees | 71,828 | 45,111 | 263,611 | 70,168 | |||||||||
| Investment in real estate, LLC | 77,528 | - | 77,774 | - | |||||||||
| Other fees and commissions | 105,361 | 77,540 | 248,930 | 197,698 | |||||||||
| Total non-interest revenue | 322,056 | 184,888 | 786,008 | 447,606 | |||||||||
Non-interest expenses | |||||||||||||
| Salaries | 713,357 | 524,764 | 1,988,168 | 1,354,774 | |||||||||
| Employee benefits | 202,888 | 89,679 | 548,661 | 237,335 | |||||||||
| Occupancy | 194,081 | 59,563 | 324,808 | 168,544 | |||||||||
| Equipment | 61,232 | 27,993 | 125,842 | 81,236 | |||||||||
| Data processing | 47,824 | 32,299 | 122,532 | 95,382 | |||||||||
| Other operating | 315,172 | 212,059 | 886,485 | 617,608 | |||||||||
| Total non-interest expenses | 1,534,554 | 946,357 | 3,996,496 | 2,554,879 | |||||||||
| Income before income taxes | 649,801 | 417,138 | 1,825,062 | 1,144,920 | |||||||||
| Income taxes | 233,177 | 135,867 | 618,243 | 394,165 | |||||||||
Net Income | $ | 416,624 | $ | 281,271 | $ | 1,206,819 | $ | 750,755 | |||||
| Basic earnings per common share | $ | 0.10 | $ | 0.13 | $ | 0.28 | $ | 0.35 | |||||
| Diluted earnings per common share | $ | 0.10 | $ | 0.13 | $ | 0.28 | $ | 0.35 | |||||