The Bancorp, Inc. (TBBK) 8-K The Bancorp, Inc. Reports Third Quarter 2013 Financial Results

Exhibit 99.1

The Bancorp, Inc. Reports Third Quarter 2013 Financial Results

Wilmington, DE – October 24, 2013 – The Bancorp, Inc. ("Bancorp") (NASDAQ: TBBK), a financial holding company, today reported financial results for the third quarter of 2013.

Net income for the third quarter of 2013 increased to $4.8 million compared to $3.6 million in the third quarter of 2012, an increase of 35%.   Year to date net income increased to $17.8 million in 2013 from $11.4 million in 2012, an increase of 56%.

Financial Highlights

·   34% increase in adjusted operating earnings, a non GAAP measure, to $15.2 million for the third quarter of 2013 versus $11.3 million for the quarter ended September 30, 2012.

·   18% increase in diluted earnings per share to $0.13 for the third quarter of 2013 versus $0.11 for the third quarter of 2012.  The number of shares used in calculating diluted earnings per share increased to 38.3 million from 33.2 million in 2012.  On a year to date basis, diluted earnings per share increased to $0.47 in 2013 from $0.34 in 2012, an increase of 38%.

·   30% increase in total quarterly revenues to $46.4 million compared to $35.6 million in third quarter 2012.

·   76% increase in quarterly non-interest income, to $19.6 million compared to $11.1 million in third quarter 2012, excluding security gains and other than temporary impairment charges.

·   36% increase in prepaid card fees, to $10.2 million compared to $7.5 million in third quarter 2012.

· 12% increase in quarterly net interest income to $24.1 million compared to $21.6 million in third quarter 2012.

Betsy Z. Cohen, Bancorp’s Chief Executive Officer, said, “Our earnings growth in the third quarter reflected increases both in net interest and non-interest income.  These drivers resulted in growth of 35% in net income, 34% in adjusted operating earnings and 18% in earnings per diluted share.  Our leadership position in the prepaid card industry is a primary vector of growth and related fee income increased 36% to $10.2 million for the quarter, compared to the prior year quarter.  Average deposits for the third quarter grew 31% and reflected growth in all major deposit categories.  At September 30, 2013 our portfolio of loans and securities had grown to $3.2 billion, an increase of $675.1 million, or 27% over September 30, 2012. Outstanding loans increased 8% over that period.  Asset growth within our targeted lending segments – Small Business Administration (SBA), security backed lines of credit and small fleet leasing – contributed disproportionately. Although total loans increased by 8%, SBA loans grew 85%, security backed lines of credit by 27% and small fleet leasing by 21%.  Despite the growth, the Company remains well capitalized, with book value per share increasing 8%, from $8.73 at September 30, 2012 to $9.39 at September 30, 2013.”

Financial Results

Bancorp reported net income available to common shareholders for the three months ended September 30, 2013 of $4.8 million, or diluted earnings per share of $0.13, based on 38,283,317weighted average diluted shares outstanding, compared to net income available to common shareholders of $3.6 million, or diluted earnings per share of $0.11, based on 33,172,852 weighted average diluted shares outstanding, for the three months ended September 30, 2012.  Adjusted operating earnings, a non-GAAP measure, increased to $15.2 million for the three months ended September 30, 2013 compared to $11.3 million for the three months ended September 30, 2012.  The following is a reconciliation of net income available to common shareholders to adjusted operating earnings, a non-GAAP measure:

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	Quarter ended						For the nine months ended
	September 30,			September 30,			September 30,			September 30,
	2013			2012			2013			2012
Net income available to common shareholders	$	4,788		$	3,561		$	17,786		$	11,387
Income tax expense		2,034			1,795			9,727			6,172
Gains on sales of investment securities		(42	)		(107	)		(785	)		(107	)
Other than temporary impairment on securities		-			-			20			126
Losses and write-downs on other real estate owned		403			533			1,469			2,405
Provision for loan and lease losses		8,000			5,540			23,000			15,047
Adjusted operating earnings (1)	$	15,183		$	11,322		$	51,217		$	35,030

(1)   As a supplement to GAAP, Bancorp has provided this non-GAAP performance measure. Bancorp believes that this non-GAAP financial measure is useful because it allows investors to assess its operating performance.  Management utilizes adjusted operating earnings to measure the combined impact of changes in net interest income, non-interest income and certain other expenses.  Other companies may calculate adjusted operating earnings differently.  Although this non-GAAP financial measure is intended to enhance investors’ understanding of Bancorp’s business and performance, it should not be considered, and is not intended to be, a substitute for net income calculated pursuant to GAAP.

Conference Call Webcast

You may access the LIVE webcast of Bancorp's Quarterly Earnings Conference Call at 8:30 AM EDT Friday, October 25, 2013 by clicking on the webcast link on Bancorp's homepage at www.thebancorp.com. Or, you may dial 866.318.8615, access code 46526535.  You may listen to the replay of the webcast following the live call on Bancorp's investor relations website or telephonically until Friday, November 1, 2013 by dialing 888.286.8010, access code 65916585.

About Bancorp

The Bancorp, Inc. is a financial holding company that operates The Bancorp Bank, an FDIC-insured commercial bank that delivers a full array of financial services both directly and through private-label affinity programs.  The Bancorp Bank’s regional community bank operations serve the needs of small and mid-size businesses and their principals in the Philadelphia-Wilmington region.

Forward-Looking Statements

Statements in this earnings release regarding The Bancorp, Inc.’s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. These statements may be identified by the use of forward-looking terminology, including but not limited to the words “may,” “believe,” “will,” “expect,” “look,” “anticipate,” “estimate,” “continue,” or similar words.  For further discussion of the risks and uncertainties to which these forward-looking statements may be subject, see The Bancorp, Inc.’s filings with the SEC, including the “Risk Factors” sections of The Bancorp Inc.’s filings. These risks and uncertainties could cause actual results to differ materially from those projected in the forward-looking statements. The forward-looking statements speak only as of the date of this presentation. The Bancorp, Inc. does not undertake to publicly revise or update forward-looking statements in this presentation to reflect events or circumstances that arise after the date of this presentation, except as may be required under applicable law.

The Bancorp, Inc. Contact

Andres Viroslav

215-861-7990

aviroslav@thebancorp.com

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The Bancorp, Inc.
Financial highlights
(unaudited)
	Three months ended				Nine months ended
	September 30,				September 30,
	2013		2012		2013			2012
	(dollars in thousands except per share data)
Condensed income statement
Net interest income	$	24,117	$	21,561	$	70,380		$	63,358
Provision for loan and lease losses		8,000		5,540		23,000			15,047
Non-interest income
Gain on sales of investment securities		42		107		785			107
Other than temporary impairment of investment securities		-		-		(20	)		(126	)
Other non-interest income		19,560		11,126		60,331			33,991
Total non-interest income		19,602		11,233		61,096			33,972
Non-interest expense
Losses and write downs on other real estate owned		403		533		1,469			2,405
Other non-interest expense		28,494		21,365		79,494			62,319
Total non-interest expense		28,897		21,898		80,963			64,724
Net income before income tax expense		6,822		5,356		27,513			17,559
Income tax expense		2,034		1,795		9,727			6,172
Net income available to common shareholders	$	4,788	$	3,561	$	17,786		$	11,387
Basic earnings per share	$	0.13	$	0.11	$	0.48		$	0.34
Diluted earnings per share	$	0.13	$	0.11	$	0.47		$	0.34
Weighted average shares - basic		37,440,838		33,105,194		37,359,230			33,101,281
Weighted average shares - diluted		38,283,317		33,172,852		37,978,108			33,133,307

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Balance sheet	September 30,			June 30,			December 31,			September 30,
	2013			2013			2012			2012
	(dollars in thousands)
Assets:
Cash and cash equivalents
Cash and due from banks	$	32,026		$	21,560		$	19,982		$	4,648
Interest earning deposits at Federal Reserve Bank		657,618			622,989			948,111			540,010
Securities sold under agreements to repurchase		40,811			40,240			-			-
Total cash and cash equivalents		730,455			684,789			968,093			544,658
Investment securities, available-for-sale, at fair value		1,083,154			1,021,848			718,065			634,894
Investment securities, held-to-maturity		97,459			95,662			45,179			22,707
Federal Home Loan Bank & Atlantic Central Bankers Bank stock		3,209			3,209			3,621			4,160
Loans held for sale, at fair value		25,557			49,355			11,341			7,970
Loans, net of deferred fees and costs		1,991,455			1,967,382			1,902,854			1,856,992
Allowance for loan and lease losses		(39,151	)		(40,274	)		(33,040	)		(33,071	)
Loans, net		1,952,304			1,927,108			1,869,814			1,823,921
Premises and equipment, net		14,252			13,709			10,368			9,802
Accrued interest receivable		12,556			12,360			9,857			10,061
Intangible assets, net		6,253			6,503			7,004			7,254
Other real estate owned		20,111			6,308			4,241			3,065
Deferred tax asset, net		26,434			27,613			22,789			19,708
Other assets		28,538			28,031			29,287			24,925
Total assets	$	4,000,282		$	3,876,495		$	3,699,659		$	3,113,125
Liabilities:
Deposits
Demand and interest checking	$	3,050,167		$	2,963,170		$	2,775,207		$	2,300,025
Savings and money market		504,447			469,238			517,098			459,725
Time deposits		9,920			12,502			12,582			12,606
Time deposits, $100,000 and over		4,683			5,747			8,334			8,819
Total deposits		3,569,217			3,450,657			3,313,221			2,781,175
Securities sold under agreements to repurchase		22,057			19,059			18,548			18,802
Accrued interest payable		73			95			103			100
Subordinated debenture		13,401			13,401			13,401			13,401
Other liabilities		42,201			49,091			17,709			10,662
Total liabilities	$	3,646,949		$	3,532,303		$	3,362,982		$	2,824,140
Shareholders' equity:
Common stock - authorized, 50,000,000 shares of $1.00 par value; 37,720,945 and 33,196,281 shares issued at September 30, 2013 and 2012, respectively		37,721			37,463			37,247			33,209
Treasury stock (100,000 shares)		(866	)		(866	)		(866	)		(866	)
Additional paid-in capital		292,715			286,321			282,708			243,954
Retained earnings (accumulated deficit)		20,291			19,993			7,347			2,110
Accumulated other comprehensive income		3,472			1,281			10,241			10,578
Total shareholders' equity		353,333			344,192			336,677			288,985
Total liabilities and shareholders' equity	$	4,000,282		$	3,876,495		$	3,699,659		$	3,113,125

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Average balance sheet and net interest income	Three months ended September 30, 2013								Three months ended September 30, 2012
(dollars in thousands)	Average					Average			Average					Average
Assets:	Balance			Interest		Rate			Balance			Interest		Rate
Interest-earning assets:
Loans net of unearned fees and costs **	$	2,037,879		$	20,676		4.06	%	$	1,827,348		$	19,646		4.30	%
Leases - bank qualified*		17,894			260		5.81	%		15,012			217		5.78	%
Investment securities-taxable		837,700			4,057		1.94	%		519,377			3,507		2.70	%
Investment securities-nontaxable*		297,301			2,040		2.74	%		105,918			1,091		4.12	%
Interest earning deposits at Federal Reserve Bank		702,492			438		0.25	%		570,667			356		0.25	%
Federal funds sold/securities purchased under agreement to resell		44,289			157		1.42	%		-			-		0.00	%
Net interest earning assets		3,937,555			27,628		2.81	%		3,038,322			24,817		3.27	%
Allowance for loan and lease losses		(41,962	)							(32,385	)
Other assets		89,135								78,241
	$	3,984,728							$	3,084,178
Liabilities and Shareholders' Equity:
Deposits:
Demand and interest checking	$	3,096,247		$	2,020		0.26	%	$	2,296,193		$	1,884		0.33	%
Savings and money market		491,991			516		0.42	%		436,484			574		0.53	%
Time		16,038			42		1.05	%		24,042			98		1.63	%
Total deposits		3,604,276			2,578		0.29	%		2,756,719			2,556		0.37	%
Repurchase agreements		19,771			13		0.26	%		20,489			24		0.47	%
Subordinated debt		13,401			115		3.43	%		13,401			218		6.51	%
Total deposits and interest bearing liabilities		3,637,448			2,706		0.30	%		2,790,609			2,798		0.40	%
Other liabilities		2,954								8,462
Total liabilities		3,640,402								2,799,071
Shareholders' equity		344,326								285,107
	$	3,984,728							$	3,084,178
Net interest income on tax equivalent basis*				$	24,922							$	22,019
Tax equivalent adjustment					805								458
Net interest income				$	24,117							$	21,561
Net interest margin *							2.53	%							2.90	%
* Full taxable equivalent basis using a 35% statutory tax rate.
** Includes loans held for sale.

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Average balance sheet and net interest income	Nine months ended September 30, 2013								Nine months ended September 30, 2012
(dollars in thousands)	Average					Average			Average					Average
Assets:	Balance			Interest		Rate			Balance			Interest		Rate
Interest-earning assets:
Loans net of unearned fees and costs **	$	1,986,507		$	61,640		4.14	%	$	1,780,565		$	57,594		4.31	%
Leases - bank qualified*		15,376			668		5.79	%		13,081			614		6.26	%
Investment securities-taxable		785,973			11,345		1.92	%		442,043			10,068		3.04	%
Investment securities-nontaxable*		210,678			4,499		2.85	%		102,736			3,252		4.22	%
Interest earning deposits at Federal Reserve Bank		960,220			1,781		0.25	%		1,073,305			2,014		0.25	%
Federal funds sold/securities purchased under agreement to resell		32,897			279		1.13	%		-			-		0.00	%
Net interest-earning assets		3,991,651			80,212		2.68	%		3,411,730			73,542		2.87	%
Allowance for loan and lease losses		(37,868	)							(31,728	)
Other assets		87,046								143,839	��
	$	4,040,829							$	3,523,841
Liabilities and Shareholders' Equity:
Deposits:
Demand and interest checking	$	3,145,748		$	5,786		0.25	%	$	2,721,620		$	5,971		0.29	%
Savings and money market		493,577			1,622		0.44	%		447,596			1,832		0.55	%
Time		18,404			144		1.04	%		28,403			301		1.41	%
Total deposits		3,657,729			7,552		0.28	%		3,197,619			8,104		0.34	%
Repurchase agreements		17,545			39		0.30	%		23,656			75		0.42	%
Subordinated debt		13,401			433		4.31	%		13,401			652		6.49	%
Total deposits and interest bearing liabilities		3,688,675			8,024		0.29	%		3,234,676			8,831		0.36	%
Other liabilities		8,020								9,526
Total liabilities		3,696,695								3,244,202
Shareholders' equity		344,134								279,639
	$	4,040,829							$	3,523,841
Net interest income on tax equivalent basis*					72,188								64,711
Tax equivalent adjustment					1,808								1,353
Net interest income				$	70,380							$	63,358
Net interest margin *							2.41	%							2.53	%
* Fully taxable equivalent basis using a 35% statutory tax rate.
** Includes loans held for sale.

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Allowance for loan and lease losses:	Nine months ended						For year ended
	September 30,			September 30,			December 31,
	2013			2012			2012
	(dollars in thousands)
Balance in the allowance for loan and lease losses at beginning of period	$	33,040		$	29,568		$	29,568
Loans charged-off:
Commercial		11,892			5,953			9,508
Construction		5,440			6,931			11,318
Lease financing		-			87			87
Residential mortgage		54			-			-
Consumer		398			299			340
Total		17,784			13,270			21,253
Recoveries:
Commercial		57			1,533			2,093
Construction		766			95			96
Lease financing		8			13			13
Residential mortgage		-			85			85
Consumer		64			-			-
Total		895			1,726			2,287
Net charge-offs		16,889			11,544			18,966
Provision charged to operations		23,000			15,047			22,438
Balance in allowance for loan and lease losses at end of period	$	39,151		$	33,071		$	33,040
Net charge-offs/average loans		0.84	%		0.64	%		1.04	%
Net charge-offs/average loans (annualized)		1.12	%		0.86	%		1.04	%
Loan portfolio:	September 30,			June 30,			December 31,			September 30,
		2013			2013			2012			2012
	(dollars in thousands)
Commercial	$	470,072		$	481,537		$	470,109		$	453,444
Commercial mortgage (1)		654,456			651,034			617,069			614,410
Construction		255,272			266,911			258,684			263,726
Total commercial loans		1,379,800			1,399,482			1,345,862			1,331,580
Direct lease financing		177,797			172,250			156,697			146,728
Residential mortgage		94,564			93,960			97,717			97,589
Consumer and other loans		332,427			295,576			296,915			276,427
		1,984,588			1,961,268			1,897,191			1,852,324
Unamortized loan fees and costs		6,867			6,114			5,663			4,668
Total loans, net of deferred loan fees and costs	$	1,991,455		$	1,967,382		$	1,902,854		$	1,856,992
Supplemental loan data:
Construction 1-4 family	$	60,989		$	64,144		$	60,343		$	71,599
Commercial construction, acquisition and development		194,283			202,767			198,341			192,127
	$	255,272		$	266,911		$	258,684		$	263,726
(1) At September 30, 2013 our owner-occupied loans amounted to $181 million, or 27.7% of commercial mortgages.

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Capital Ratios	Tier 1 capital			Tier 1 capital			Total capital
	to average assets			to risk-weighted assets			to risk-weighted assets
As of September 30, 2013
Bancorp		8.91	%		14.54	%		15.80	%
The Bancorp Bank		6.86	%		11.23	%		12.49	%
"Well capitalized" institution (under FDIC regulations)		5.00	%		6.00	%		10.00	%
As of December 31, 2012
Bancorp		10.00	%		16.39	%		17.64	%
The Bancorp Bank		7.25	%		11.91	%		13.16	%
"Well capitalized" institution (under FDIC regulations)		5.00	%		6.00	%		10.00	%

	Three months ended						Nine months ended
	September 30,						September 30,
	2013			2012			2013			2012
Selected operating ratios:
Return on average assets (annualized)		0.48	%		0.46	%		0.59	%		0.43	%
Return on average equity (annualized)		5.52	%		4.97	%		6.91	%		5.44	%
Net interest margin		2.53	%		2.90	%		2.41	%		2.53	%
Efficiency ratio (1)		66.16	%		66.99	%		61.95	%		66.57	%
Book value per share	$	9.39		$	8.73		$	9.39		$	8.73
	September 30,			June 30,			December 31,			September 30,
	2013			2013			2012			2012
Asset quality ratios:
Nonperforming loans to total loans (2)		2.46	%		2.16	%		1.56	%		1.63	%
Nonperforming assets to total assets (2)		1.73	%		1.26	%		0.92	%		1.07	%
Allowance for loan and lease losses to total loans		1.97	%		2.05	%		1.74	%		1.78	%
Nonaccrual loans	$	48,750		$	41,743		$	25,190		$	26,454
Other real estate owned		20,111			6,308			4,241			3,065
Total nonperforming assets	$	68,861		$	48,051		$	29,431		$	29,519
Loans 90 days past due still accruing interest	$	204		$	753		$	4,435		$	3,861
(1) As a supplement to GAAP, Bancorp has provided this non-GAAP performance result. The Bancorp believes that this non-GAAP financial measure is useful because it allows investors to assess its operating performance. Management utilizes the efficiency ratio to measure overhead as a percentage of revenue. Other companies may calculate the efficiency ratio differently. Although this non-GAAP financial measure is intended to enhance investors’ understanding of Bancorp’s business and performance, it should not be considered, and is not intended to be, a substitute for net income calculated pursuant to GAAP.

	Three months ended						Nine months ended
	September 30,						September 30,
	2013			2012			2013			2012
Reconciliation of the efficiency ratio, a non-GAAP measure:
Non-interest expense (a)	$	28,897		$	21,898		$	80,963		$	64,724
Net interest income		24,117			21,561			70,380			63,358
Non-interest income		19,602			11,233			61,096			33,972
Less: Gain on sale of securities		(42	)		(107	)		(785	)		(107	)
Adjusted net interest and non-interest income (b)	$	43,677		$	32,687		$	130,691		$	97,223
(a) divided by (b)		66.16	%		66.99	%		61.95	%		66.57	%
(2) Nonperforming loan and asset ratios include nonaccrual loans and loans 90 days past due still accruing interest.

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