EXHIBIT 99.1
Old Line Bancshares, Inc. Reports a 15.95 Percent Increase in Twelve Month Net Income
BOWIE, Md., Feb. 8, 2010 (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 attributable to Old Line Bancshares, Inc. increased $280,032 or 15.95% for the twelve months ended December 31, 2009 to $2.0 million from $1.8 million for the twelve months ended December 31, 2008. 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 stockholders for the twelve month period was $1.6 million. Earnings per basic and diluted common share were $0.40 for the twelve months ended December 31, 2009 and $0.44 for the same period in 2008. The 15.95% increase in net income for the twelve month period was primarily the result of a $2.0 million increase in net interest income. The increase in net interest income derived primarily from a $36.5 million or 16.91% increase in average net loans outstanding during the period. We also had an approximately $145,000 increase in pre-tax earnings from our majority owned subsidiary Pointer Ridge Office Investments, LLC and an approximately $159,000 gain from sale on investments. These increases were partially offset by a $485,000 increase in the loan loss provision from $415,000 to $900,000 and increased operating expenses associated with the operations of our College Park, Annapolis, Crofton and Glen Dale branches that opened in February 2008, September 2008, July 2009 and October 2009, respectively. During the twelve month period, we incurred a $392,000 increase in FDIC insurance premiums inclusive of a $149,000 speci al assessment. As we previously reported, the increase in earnings from Pointer Ridge derived from a non-recurring lease termination fee recorded in the 1st quarter of 2009. In an effort to minimize call and pre-payment risk and manage future interest rate risk, we elected to sell available-for-sale securities during the period, resulting in the $159,000 gain on the sale of investments. We did not sell any available-for-sale securities during the twelve months ended December 31, 2008.
For the three month period ended December 31, 2009, net income attributable to Old Line Bancshares, Inc. increased $85,165 or 22.35% to $466,233 compared to $381,068 reported for the three month period ended December 31, 2008. After inclusion of the dividend on the preferred stock, net income available to common stockholders increased $114,494 or 32.55% to $466,233 from $351,739 for the three month period. Earnings per basic and diluted common share were $0.12 for the three month period ended December 31, 2009 compared to $0.09 for the three month period ended December 31, 2008. During the three month period, net interest income increased $617,815 as a result of continued growth in the loan portfolio. Non-interest revenue increased $51,035 primarily because of the increase in our ownership interest in Pointer Ridge Office Investment, LLC in December 2008. The $70,000 increase in the loan loss provision, the costs associated with the operations of the Crofton branch that opened in Ju ly 2009 and the Glen Dale branch that opened in October 2009 and the consolidation of Pointer Ridge, LLC, partially offset these increases in interest revenue and non-interest revenue.
Mr. Cornelsen stated: "2008 and 2009 were the most challenging years that the financial services industry has encountered since the depression. The current economy remains fragile and continues to present a whole host of challenges to us and our customers. While many of our peer banks have experienced devastating financial losses, high delinquencies and record levels of charge-offs, we have managed to maintain profitability and asset quality in an extremely challenging environment while incurring increased FDIC insurance cost, increased operating costs associated with our new branches and a $485,000 increase in the loan loss provision for the twelve month period. Our asset quality remains strong with only 2 loans totaling $581,000 past due between 30 and 89 days. We also have three non –accrual loans totaling $1.6 million or 0.45% of total assets. We continue to remain cautiously optimistic that we will continue to successfully navigate through this difficult period. However, we also recognize that we are not immune to losses in our loan portfolio. If the unemployment rate continues to remain high and real estate values decline further, we anticipate that even our strong borrowers may experience financial difficulties as they continue to cope with declining revenues, diminishing cash flows and depreciating collateral values in their businesses. Therefore, we expect that we will continue to maintain a higher allowance for loan losses than we have historically required."
Mr. Cornelsen continued, "We have always believed that the experience of our personnel is our best asset. This experience coupled with our relationships with our customers and our conservative management and credit culture have allowed us to continue to grow loans and improve our earnings performance. We are excited that in January of this year, we were able to announce the addition of our new lending team in our Greenbelt office. These individuals join us with many years of experience and knowledge about the local community and we believe they are a valuable addition to our team."
As we previously reported, we repurchased from the U.S. Treasury the 7,000 shares of preferred stock that we issued to them in December 2008 under its Capital Purchase Program under the Troubled Asset Relief Program (TARP). We paid Treasury $7,058,333 to repurchase the preferred stock which reflects the liquidation value of the preferred stock and $58,333 of accrued but unpaid dividends. After careful consideration, we determined that we would repay the U.S. Treasury and believe this repayment will be in the best long term interest of our stockholders. In August, we also repurchased at a fair market value of $225,000 the warrant to purchase 141,892 shares of our common stock that was issued to the U.S. Treasury in conjunction with the issuance of the preferred stock.
At December 31, 2009, the allowance for loan losses was $2.5 million or 0.93% of gross loans compared to $1.9 million or 0.85% of gross loans at December 31, 2008. Based on our history, internal analysis and the satisfactory historical performance of the loan portfolio, we believe the allowance continues to appropriately reflect the inherent risk of loss in our portfolio and the current economic climate.
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, one branch in Crofton, Maryland and five 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 the statements with respect to the adequacy of our loan loss allowance, our borrowers experiencing financial difficulty, our continued success, and stockholder benefits from the repurchase of the preferred stock and warrant issued under TARP 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, further deterioration in economic conditions in our target markets or nationally a nd changes in laws impacting our ability to collect on outstanding loans or otherwise negatively impact our business. 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, | 2009 | 2008 |
| | (Unaudited) | |
| Assets |
| Cash and due from banks | $7,402,137 | $8,823,170 |
| Interest bearing accounts | 3,953,312 | -- |
| Federal funds sold | 81,138 | 2,140,525 |
| Total cash and cash equivalents | 11,436,587 | 10,963,695 |
| Time deposits in other banks | 15,031,102 | 13,267,000 |
| Investment securities available for sale | 28,012,948 | 29,565,976 |
| Investment securities held to maturity | 5,806,507 | 8,003,391 |
| Loans, less allowance for loan losses | 265,008,669 | 231,053,618 |
| Restricted equity securities at cost | 2,957,650 | 2,126,550 |
| Bank premises and equipment | 17,326,099 | 12,388,046 |
| Accrued interest receivable | 1,055,249 | 1,091,560 |
| Prepaid income taxes | -- | 35,649 |
| Deferred income taxes | 178,574 | -- |
| Bank owned life insurance | 8,422,879 | 8,096,039 |
| Other assets | 1,982,262 | 1,139,101 |
| Total assets | $ 357,218,526 | $ 317,730,625 |
| | | |
| Liabilities and Stockholders' Equity |
| | | |
| Deposits | | |
| Noninterest-bearing | $40,883,419 | $39,880,119 |
| Interest-bearing | 245,464,373 | 191,550,521 |
| Total deposits | 286,347,792 | 231,430,640 |
| Short-term borrowings | 16,149,939 | 17,773,934 |
| Long-term borrowings | 16,454,067 | 21,531,133 |
| Accrued interest payable | 517,889 | 625,446 |
| Income tax payable | 175,543 | -- |
| Deferred income taxes | -- | 65,651 |
| Other liabilities | 941,165 | 4,012,968 |
| Total liabilities | 320,586,395 | 275,439,772 |
| | | |
| Stockholders' equity | | |
Preferred stock, par value $0.01 per share and additional paid in capital;
7,000 shares issued and outstanding in 2008 | -- | 6,703,591 |
| Common stock, par value $.01 per share; authorized 15,000,000 shares; issued and outstanding 3,862,364 | 38,624 | 38,624 |
| Additional paid-in capital | 29,034,954 | 28,838,810 |
| Warrants to purchase 141,892 shares of common stock | -- | 301,434 |
| Retained earnings | 6,498,446 | 5,411,772 |
| Accumulated other comprehensive income | 368,880 | 392,611 |
| Total Old Line Bancshares, Inc. stockholders' equity | 35,940,904 | 41,686,842 |
| Noncontrolling interest | 691,227 | 604,011 |
| Total stockholders' equity | 36,632,131 | 42,290,853 |
| Total liabilities and stockholders' equity | $ 357,218,526 | $ 317,730,625 |
| Old Line Bancshares, Inc. & Subsidiary |
| Consolidated Statements of Income |
| | | |
| | Three Months Ended
December 31, | Twelve Months Ended
December 31, |
| | 2009
(Unaudited) | 2008
(Unaudited) | 2009
(Unaudited) | 2008 |
| Interest revenue | | | | |
| Loans, including fees | $3,961,137 | $3,620,185 | $ 15,304,608 | $ 14,240,545 |
| U.S. Treasury securities | -- | 10,842 | 7,230 | 69,079 |
| U.S. government agency securities | 33,698 | 91,766 | 296,560 | 181,792 |
| Mortgage backed securities | 258,720 | 147,345 | 1,059,386 | 356,398 |
| Municipal securities | 19,989 | 23,128 | 84,797 | 95,822 |
| Federal funds sold | 175 | 28,540 | 1,148 | 285,619 |
| Other | 100,737 | 69,768 | 342,127 | 194,981 |
| Total interest revenue | 4,374,456 | 3,991,574 | 17,095,856 | 15,424,236 |
| Interest expense | | | | |
| Deposits | 1,053,478 | 1,328,017 | 4,553,099 | 5,101,608 |
| Borrowed funds | 254,718 | 215,112 | 1,026,755 | 808,127 |
| Total interest expense | 1,308,196 | 1,543,129 | 5,579,854 | 5,909,735 |
| Net interest income | 3,066,260 | 2,448,445 | 11,516,002 | 9,514,501 |
| Provision for loan losses | 140,000 | 70,000 | 900,000 | 415,000 |
| Net interest income after provision for loan losses | 2,926,260 | 2,378,445 | 10,616,002 | 9,099,501 |
| | | | | |
| Non-interest revenue | | | | |
| Service charges on deposit accounts | 81,517 | 80,531 | 307,012 | 311,268 |
| Net gains on sales of investment securities | -- | -- | 158,551 | -- |
| Earnings on bank owned life insurance | 93,228 | 93,176 | 376,165 | 366,785 |
| Income (loss) on investment in real estate LLC | -- | (2,163) | -- | 3,741 |
| Loss on disposal of assets | -- | -- | (4,803) | -- |
| Other fees and commissions | 138,014 | 90,180 | 982,842 | 282,138 |
| Total non-interest revenue | 312,759 | 261,724 | 1,819,767 | 963,932 |
| Non-interest expense | | | | |
| Salaries | 1,185,468 | 1,007,457 | 4,037,027 | 3,316,219 |
| Employee benefits | 251,390 | 199,701 | 1,012,014 | 923,666 |
| Occupancy | 312,591 | 287,400 | 1,085,768 | 1,124,838 |
| Equipment | 96,133 | 84,696 | 354,531 | 313,133 |
| Data processing | 93,058 | 76,590 | 340,870 | 269,632 |
| Other operating | 599,752 | 410,468 | 2,426,671 | 1,425,290 |
| Total non-interest expense | 2,538,392 | 2,066,312 | 9,256,881 | 7,372,778 |
| | | | | |
| Income before income taxes | 700,627 | 573,857 | 3,178,888 | 2,690,655 |
| Income taxes | 243,109 | 197,635 | 1,055,523 | 939,383 |
| Net income | 457,518 | 376,222 | 2,123,365 | 1,751,272 |
| Less:Net Income attributable to the noncontrolling interest | (8,715) | (4,846) | 87,215 | (4,846) |
| Net Income attributable to Old Line Bancshares, Inc. | 466,233 | 381,068 | 2,036,150 | 1,756,118 |
| Preferred stock dividends and discount accretion | -- | 29,329 | 485,993 | 29,329 |
| Net income available to common stockholders | $466,233 | $351,739 | $1,550,157 | $1,726,789 |
| | | | | |
| Basic earnings per common share | $0.12 | $0.09 | $0.40 | $0.44 |
| Diluted earnings per common share | $0.12 | $0.09 | $0.40 | $0.44 |
| Dividend per common share | $0.03 | $0.03 | $0.12 | $0.12 |
CONTACT: Old Line Bancshares, Inc.
Christine M. Rush, Chief Financial Officer
(301) 430-2544