The Bancorp, Inc. Reports Third Quarter 2015 Financial Results
Wilmington, DE – October 29, 2015 – The Bancorp, Inc. ("Bancorp") (NASDAQ: TBBK), a financial holding company, today reported financial results for third quarter 2015.
Bancorp reported net loss of $5.6 million or diluted loss per share of $0.15 for third quarter 2015 compared to net income of $25.0 million or $0.66 earnings per diluted share in third quarter 2014. Net loss from continuing operations for third quarter 2015 was $7.4 million or $0.20 per diluted share compared to net income of $5.8 million or $0.15 per diluted share in third quarter 2014. The third quarter 2015 net loss in continuing operations reflected $11.7 million of pretax Bank Secrecy Act (“BSA”) and lookback consulting expenses and variability in Bancorp’s non-interest income from the sale of loans into secondary commercial mortgage backed securities markets (“CMBS”). Lookback expenses are being incurred to analyze historical transactions for compliance with suspicious activity reporting requirements. Income from continuing operations does not include any income which may result upon the reinvestment of the proceeds of sales we are pursuing from the approximately $588.7 million of commercial and residential loans in the Bancorp’s discontinued operations.
Financial Highlights
Continuing Operations:
| · | Gain of $34.4 million, prior to disposition and transaction expenses, upon the October 22, 2015 sale of the majority of the health savings account (“H.S.A.”) portfolio is not reflected in third quarter 2015 results. |
| · | Increases over prior year loan balances in security-backed lines of credit (“SBLOC”) 35%, Small Business Administration (“SBA”) 35% and Leasing 11%. |
| · | 17% increase in net interest income to $17.8 million compared to $15.3 million in third quarter 2014. |
| · | Loans and CMBS loans held for sale in continuing operations totaled $1.35 billion at September 30, 2015 compared to $992.5 million at September 30, 2014, a 36% increase. |
| · | Tier one capital to assets, tier one capital to risk-weighted assets, total capital to risk-weighted assets and common equity-tier 1 were 6.27%, 14.14%, 14.35% and 14.14%, compared to well capitalized minimums of 5%, 8%, 10% and 6.5%. |
Frank M. Mastrangelo, Bancorp’s Chief Executive Officer, said, “The third quarter continued to show progress in the transition to what we believe, and our historical results evidence, are better performing lines of business. Growth in our SBLOC, SBA, and Leasing portfolios drove a net interest income increase of 17% to $17.8 million for the quarter. Prepaid and Payment Sponsorship fee income, our principal non-interest income driver, showed a narrowing in its decrease to the prior year third quarter, compared to the reduction in second quarter 2015 versus second quarter 2014. We believe that positive trends in growth will continue and year over year increases will result in 2016. Subsequent to September 30, 2015, we executed on a strategy to exit the majority of our H.S.A. administration business. Those deposits were among those with the highest projected deposit costs, while related overhead largely offset profitability. Those client relationships were sold at a gain of $34.4 million, prior to disposition and transaction expenses, which will improve our capital ratios at December 31, 2015 and the bank’s tax position relative to the utilization of its deferred tax assets. A December 2015 transfer date for the approximate $400 million of H.S.A. deposits related to the sale, will reduce excess balances maintained at the Federal Reserve Bank. Such excess balances increase average assets and lower capital ratios. Additionally, approximately $485 million of other higher cost deposit relationships, without adequate offsetting fee income or loan production potential, were exited in early October 2015. Those exits will further reduce excess Federal Reserve Bank balances.
While the lookback consultant has continued to make progress toward final completion, costs continue to be in excess of estimates and were higher in the third quarter compared to prior quarters. Additionally, while the sale of loans into secondary CMBS markets contributes to annual profitability, quarterly results vary significantly. That variability and the lookback expenses were primary determinants in the continuing operations loss for the third quarter. In coming quarters we look forward to the end of the lookback expenses and believe that the CMBS sales will return to profitability as previously demonstrated. Those improvements, the expected prepaid card fee trends, as well as the loan and corresponding net interest income growth described earlier should be the primary drivers toward additional progress.
Book value at September 30, 2015 amounted to $8.31 compared to $7.88 at September 30, 2014. The Bancorp and its subsidiary, The Bancorp Bank, remain well capitalized.”
Non-Recurring Expense During Period:
(dollars in thousands)
| | | Three months ended | | | Nine months ended | |
| | | September 30, 2015 | | | September 30, 2015 | |
| Continuing operations: | | | | | | |
| BSA consultant and lookback fees: | | $ | 11,687 | | | $ | 26,643 | |
| Regulatory related legal fees | | | 413 | | | | 1,689 | |
| Discontinued operations: | | | | | | | | |
| Restatement related audit fees | | | 1,035 | | | | 2,560 | |
| Other real estate owned expense | | | 731 | | | | 1,855 | |
| Pre-tax loss- continuing operations | | | (13,073 | ) | | | (22,490 | ) |
| Pre-tax income- discontinued operations | | | 2,747 | | | | 9,943 | |
| Pre-tax income after analysis of non-recurring fees | | $ | 3,540 | | | $ | 20,200 | |
Conference Call Webcast
You may access the LIVE webcast of Bancorp's Quarterly Earnings Conference Call at 8:00 AM EDT Friday, October 30, 2015 by clicking on the webcast link on Bancorp's homepage at www.thebancorp.com. Or, you may dial 877.787.4143, access code 58529199. You may listen to the replay of the webcast following the live call on Bancorp's investor relations website or telephonically until Friday, November 6, 2015 by dialing 855.859.2056, access code 58529199.
About Bancorp
The Bancorp, a leading provider of private-label banking and technology solutions for non-bank companies in the U.S., delivers a wide range of banking services to its customers, including the issuance of prepaid and debit cards, ACH payments, private label banking and merchant payment processing. The Bancorp also engages in specialty lending, such as automobile-fleet leasing, the origination and sale of commercial real estate loans, SBA lending and SBLOCs. With operations in the U.S. and now in Europe, The Bancorp is dedicated to setting a new standard in financial services and payments innovation. Since its formation in 2000, The Bancorp has become the leading issuer of prepaid cards, a National Preferred SBA Lender, a top ACH Originator, and one of the nation’s largest credit card transaction acquirers. For more information please visit www.thebancorp.com.
Forward-Looking Statements
Statements in this earnings release regarding Bancorp’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 Bancorp’s filings with the SEC, including the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of those 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 press release. The Bancorp does not undertake to publicly revise or update forward-looking statements in this press release 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
| The Bancorp, Inc. | |
| Financial highlights | |
| (unaudited) | |
| | | Three months ended | | | Nine months ended | |
| | | September 30, | | | September 30, | |
| | | 2015 | | | 2014 | | | 2015 | | | 2014 | |
| | | (dollars in thousands except per share data) | |
| Condensed income statement | | | | | | | | | | | | |
| Net interest income | | $ | 17,798 | | | $ | 15,268 | | | $ | 51,349 | | | $ | 43,710 | |
| Provision for loan and lease losses | | | 625 | | | | 158 | | | | 1,800 | | | | 2,606 | |
| Non-interest income | | | | | | | | | | | | | | | | |
| Service fees on deposit accounts | | | 1,919 | | | | 1,692 | | | | 5,579 | | | | 4,279 | |
| Card payment and ACH processing fees | | | 1,493 | | | | 1,369 | | | | 4,242 | | | | 3,989 | |
| Prepaid card fees | | | 11,492 | | | | 12,307 | | | | 35,752 | | | | 38,673 | |
| Gain (loss) on sale of loans | | | (830 | ) | | | 2,772 | | | | 6,747 | | | | 13,468 | |
| Gain (loss) on sales of investment securities | | | (335 | ) | | | (35 | ) | | | (62 | ) | | | 365 | |
| Leasing income | | | 552 | | | | 840 | | | | 1,727 | | | | 2,236 | |
| Debit card income | | | 427 | | | | 414 | | | | 1,358 | | | | 1,296 | |
| Affinity fees | | | 1,083 | | | | 649 | | | | 2,391 | | | | 1,851 | |
| Other non-interest income | | | 1,498 | | | | 299 | | | | 5,066 | | | | 1,217 | |
| Total non-interest income | | | 17,299 | | | | 20,307 | | | | 62,800 | | | | 67,374 | |
| Non-interest expense | | | | | | | | | | | | | | | | |
| Bank Secrecy Act and lookback consulting expenses | | | 11,687 | | | | 2,749 | | | | 26,643 | | | | 4,918 | |
| Other non-interest expense | | | 35,858 | | | | 30,386 | | | | 108,196 | | | | 93,434 | |
| Total non-interest expense | | | 47,545 | | | | 33,135 | | | | 134,839 | | | | 98,352 | |
| Income (loss) from continuing operations before income tax expense | | | (13,073 | ) | | | 2,282 | | | | (22,490 | ) | | | 10,126 | |
| Income tax benefit | | | (5,706 | ) | | | (3,560 | ) | | | (10,817 | ) | | | (594 | ) |
| Net income (loss) from continuing operations | | | (7,367 | ) | | | 5,842 | | | | (11,673 | ) | | | 10,720 | |
| Net income from discontinued operations, net of tax | | | 1,792 | | | | 19,127 | | | | 6,486 | | | | 26,198 | |
| Net income (loss) available to common shareholders | | $ | (5,575 | ) | | $ | 24,969 | | | $ | (5,187 | ) | | $ | 36,918 | |
| | | | | | | | | | | | | | | | | |
| Net income (loss) per share from continuing operations - basic | | $ | (0.20 | ) | | $ | 0.15 | | | $ | (0.31 | ) | | $ | 0.28 | |
| Net income per share from discontinued operations - basic | | $ | 0.05 | | | $ | 0.51 | | | $ | 0.17 | | | $ | 0.70 | |
| Net income (loss) per share - basic | | $ | (0.15 | ) | | $ | 0.66 | | | $ | (0.14 | ) | | $ | 0.98 | |
| | | | | | | | | | | | | | | | | |
| Net income (loss) per share from continuing operations - diluted | | $ | (0.20 | ) | | $ | 0.15 | | | $ | (0.31 | ) | | $ | 0.28 | |
| Net income per share from discontinued operations - diluted | | $ | 0.05 | | | $ | 0.51 | | | $ | 0.17 | | | $ | 0.68 | |
| Net income (loss) per share - diluted | | $ | (0.15 | ) | | $ | 0.66 | | | $ | (0.14 | ) | | $ | 0.96 | |
| Weighted average shares - basic | | | 37,758,322 | | | | 37,608,862 | | | | 37,754,110 | | | | 37,698,759 | |
| Weighted average shares - diluted (a) | | | 37,758,322 | | | | 38,002,639 | | | | 37,754,110 | | | | 38,429,202 | |
| | | | | | | | | | | | | | | | | |
| (a) For loss periods the weighted averages shares - basic is used in both the basic and diluted computations. | | | | | | | | | |
| Balance sheet | | September 30, | | | June 30, | | | March 31, | | | September 30, | |
| | | 2015 | | | 2015 | | | 2015 | | | 2014 | |
| | | (dollars in thousands) | |
| Assets: | | | | | | | | | | | | |
| Cash and cash equivalents | | | | | | | | | | | | |
| Cash and due from banks | | $ | 4,002 | | | $ | 13,269 | | | $ | 18,636 | | | $ | 9,913 | |
| Interest earning deposits at Federal Reserve Bank | | | 995,441 | | | | 936,989 | | | | 994,400 | | | | 430,117 | |
| Securities sold under agreements to resell | | | 37,970 | | | | 40,068 | | | | 46,250 | | | | 55,450 | |
| Total cash and cash equivalents | | | 1,037,413 | | | | 990,326 | | | | 1,059,286 | | | | 495,480 | |
| | | | | | | | | | | | | | | | | |
| Investment securities, available-for-sale, at fair value | | | 1,316,706 | | | | 1,370,027 | | | | 1,442,665 | | | | 1,442,049 | |
| Investment securities, held-to-maturity | | | 93,604 | | | | 93,649 | | | | 93,662 | | | | 96,951 | |
| Loans held for sale, at fair value | | | 354,600 | | | | 284,501 | | | | 239,820 | | | | 136,115 | |
| Loans, net of deferred fees and costs | | | 994,518 | | | | 968,033 | | | | 870,901 | | | | 856,428 | |
| Allowance for loan and lease losses | | | (4,194 | ) | | | (4,352 | ) | | | (4,243 | ) | | | (5,300 | ) |
| Loans, net | | | 990,324 | | | | 963,681 | | | | 866,658 | | | | 851,128 | |
| Federal Home Loan Bank & Atlantic Central Bankers Bank stock | | | 1,062 | | | | 1,063 | | | | 1,003 | | | | 3,409 | |
| Premises and equipment, net | | | 18,893 | | | | 19,271 | | | | 19,158 | | | | 17,536 | |
| Accrued interest receivable | | | 11,232 | | | | 11,526 | | | | 11,290 | | | | 11,061 | |
| Intangible assets, net | | | 5,248 | | | | 5,541 | | | | 5,791 | | | | 6,573 | |
| Other real estate owned | | | - | | | | - | | | | - | | | | 725 | |
| Deferred tax asset, net | | | 33,857 | | | | 35,874 | | | | 32,025 | | | | 71,021 | |
| Investment in unconsolidated entity | | | 186,656 | | | | 187,186 | | | | 190,783 | | | | - | |
| Assets held for sale | | | 611,729 | | | | 651,158 | | | | 842,574 | | | | 1,066,029 | |
| Other assets | | | 53,123 | | | | 43,804 | | | | 43,734 | | | | 39,046 | |
| Total assets | | $ | 4,714,447 | | | $ | 4,657,607 | | | $ | 4,848,449 | | | $ | 4,237,123 | |
| | | | | | | | | | | | | | | | | |
| Liabilities: | | | | | | | | | | | | | | | | |
| Deposits | | | | | | | | | | | | | | | | |
| Demand and interest checking | | $ | 4,002,638 | | | $ | 3,993,393 | | | $ | 4,182,656 | | | $ | 3,554,484 | |
| Savings and money market | | | 376,577 | | | | 321,264 | | | | 307,988 | | | | 324,015 | |
| Time deposits | | | - | | | | 1,400 | | | | 1,400 | | | | 231 | |
| Time deposits, $100,000 and over | | | - | | | | - | | | | - | | | | 2,895 | |
| Total deposits | | | 4,379,215 | | | | 4,316,057 | | | | 4,492,044 | | | | 3,881,625 | |
| | | | | | | | | | | | | | | | | |
| Securities sold under agreements to repurchase | | | 1,034 | | | | 2,357 | | | | 7,959 | | | | 21,496 | |
| Subordinated debenture | | | 13,401 | | | | 13,401 | | | | 13,401 | | | | 13,401 | |
| Other liabilities | | | 7,100 | | | | 10,038 | | | | 12,992 | | | | 23,603 | |
| Total liabilities | | $ | 4,400,750 | | | $ | 4,341,853 | | | $ | 4,526,396 | | | $ | 3,940,125 | |
| | | | | | | | | | | | | | | | | |
| Shareholders' equity: | | | | | | | | | | | | | | | | |
Common stock - authorized, 50,000,000 shares of $1.00 par value; 37,858,322 and 37,808,777 shares issued at September 30, 2015 and 2014, respectively | | | 37,858 | | | | 37,858 | | | | 37,858 | | | | 37,809 | |
| Treasury stock (100,000 shares) | | | (866 | ) | | | (866 | ) | | | (866 | ) | | | (866 | ) |
| Additional paid-in capital | | | 299,470 | | | | 298,978 | | | | 298,402 | | | | 297,122 | |
| Retained earnings | | | (33,429 | ) | | | (27,854 | ) | | | (28,029 | ) | | | (48,435 | ) |
| Accumulated other comprehensive income | | | 10,664 | | | | 7,638 | | | | 14,688 | | | | 11,368 | |
| Total shareholders' equity | | | 313,697 | | | | 315,754 | | | | 322,053 | | | | 296,998 | |
| | | | | | | | | | | | | | | | | |
| Total liabilities and shareholders' equity | | $ | 4,714,447 | | | $ | 4,657,607 | | | $ | 4,848,449 | | | $ | 4,237,123 | |
| Average balance sheet and net interest income | | Three months ended September 30, 2015 | | | Three months ended September 30, 2014 | |
| (dollars in thousands) | | | | | | | | | | | (restated) | |
| | | Average | | | | | | Average | | | Average | | | | | | Average | |
| Assets: | | Balance | | | Interest | | | Rate | | | Balance | | | Interest | | | Rate | |
| Interest-earning assets: | | | | | | | | | | | | | | | | | | |
| Loans net of unearned fees and costs ** | | $ | 1,292,533 | | | $ | 12,466 | | | | 3.86 | % | | $ | 907,691 | | | $ | 9,032 | | | | 3.98 | % |
| Leases - bank qualified* | | | 30,091 | | | | 530 | | | | 7.05 | % | | | 16,706 | | | | 218 | | | | 5.22 | % |
| Investment securities-taxable | | | 940,590 | | | | 4,562 | | | | 1.94 | % | | | 1,029,544 | | | | 5,311 | | | | 2.06 | % |
| Investment securities-nontaxable* | | | 518,691 | | | | 4,765 | | | | 3.67 | % | | | 526,393 | | | | 4,858 | | | | 3.69 | % |
| Interest earning deposits at Federal Reserve Bank | | | 957,078 | | | | 580 | | | | 0.24 | % | | | 477,609 | | | | 285 | | | | 0.24 | % |
| Federal funds sold and securities purchased under agreement to resell | | | 40,705 | | | | 143 | | | | 1.41 | % | | | 31,153 | | | | 105 | | | | 1.35 | % |
| Net interest earning assets | | | 3,779,688 | | | | 23,046 | | | | 2.44 | % | | | 2,989,096 | | | | 19,809 | | | | 2.65 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Allowance for loan and lease losses | | | (4,385 | ) | | | | | | | | | | | (8,473 | ) | | | | | | | | |
| Assets held for sale | | | 627,806 | | | | 6,343 | | | | 4.04 | % | | | 1,227,796 | | | | 12,689 | | | | 4.13 | % |
| Other assets | | | 286,839 | | | | | | | | | | | | 5,642 | | | | | | | | | |
| | | $ | 4,689,948 | | | | | | | | | | | $ | 4,214,061 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Liabilities and Shareholders' Equity: | | | | | | | | | | | | | | | | | | | | | | | | |
| Deposits: | | | | | | | | | | | | | | | | | | | | | | | | |
| Demand and interest checking | | $ | 3,998,798 | | | $ | 2,850 | | | | 0.29 | % | | $ | 3,565,814 | | | $ | 2,260 | | | | 0.25 | % |
| Savings and money market | | | 337,793 | | | | 426 | | | | 0.50 | % | | | 312,890 | | | | 361 | | | | 0.46 | % |
| Time | | | 410 | | | | 1 | | | | 0.98 | % | | | 4,781 | | | | 14 | | | | 1.17 | % |
| Total deposits | | | 4,337,001 | | | | 3,277 | | | | 0.30 | % | | | 3,883,485 | | | | 2,635 | | | | 0.27 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Repurchase agreements | | | 1,606 | | | | 1 | | | | 0.25 | % | | | 18,396 | | | | 14 | | | | 0.30 | % |
| Subordinated debt | | | 13,401 | | | | 117 | | | | 3.49 | % | | | 13,401 | | | | 116 | | | | 3.46 | % |
| Total deposits and interest bearing liabilities | | | 4,352,008 | | | | 3,395 | | | | 0.31 | % | | | 3,915,282 | | | | 2,765 | | | | 0.28 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Other liabilities | | | 12,957 | | | | | | | | | | | | 14,615 | | | | | | | | | |
| Total liabilities | | | 4,364,965 | | | | | | | | | | | | 3,929,897 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Shareholders' equity | | | 324,983 | | | | | | | | | | | | 284,164 | | | | | | | | | |
| | | $ | 4,689,948 | | | | | | | | | | | $ | 4,214,061 | | | | | | | | | |
| Net interest income on tax equivalent basis* | | | | | | $ | 25,994 | | | | | | | | | | | $ | 29,733 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Tax equivalent adjustment | | | | | | | 1,853 | | | | | | | | | | | | 1,776 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest income | | | | | | $ | 24,141 | | | | | | | | | | | $ | 27,957 | | | | | |
| Net interest margin * | | | | | | | | | | | 2.34 | % | | | | | | | | | | | 2.81 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| * Full taxable equivalent basis, using a 35% statutory tax rate. | | | | | | | | | | | | | | | | | | | | | | | | |
| ** Includes loans held for sale. | | | | | | | | | | | | | | | | | | | | | | | | |
| Average balance sheet and net interest income | | Nine months ended September 30, 2015 | | | Nine months ended September 30, 2014 | |
| (dollars in thousands) | | | | | | | | | | | (restated) | |
| | | Average | | | | | | Average | | | Average | | | | | | Average | |
| Assets: | | Balance | | | Interest | | | Rate | | | Balance | | | Interest | | | Rate | |
| Interest-earning assets: | | | | | | | | | | | | | | | | | | |
| Loans net of unearned fees and costs ** | | $ | 1,192,939 | | | $ | 34,231 | | | | 3.83 | % | | $ | 858,829 | | | $ | 25,979 | | | | 4.03 | % |
| Leases - bank qualified* | | | 23,936 | | | | 1,247 | | | | 6.95 | % | | | 17,756 | | | | 708 | | | | 5.32 | % |
| Investment securities-taxable | | | 983,557 | | | | 14,628 | | | | 1.98 | % | | | 1,037,344 | | | | 15,804 | | | | 2.03 | % |
| Investment securities-nontaxable* | | | 524,913 | | | | 14,443 | | | | 3.67 | % | | | 459,508 | | | | 12,613 | | | | 3.66 | % |
| Interest earning deposits at Federal Reserve Bank | | | 1,001,027 | | | | 1,759 | | | | 0.23 | % | | | 793,560 | | | | 1,460 | | | | 0.25 | % |
| Federal funds sold and securities purchased under agreement to resell | | | 43,724 | | | | 465 | | | | 1.42 | % | | | 28,612 | | | | 296 | | | | 1.38 | % |
| Net interest-earning assets | | | 3,770,096 | | | | 66,773 | | | | 2.36 | % | | | 3,195,609 | | | | 56,860 | | | | 2.37 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Allowance for loan and lease losses | | | (4,089 | ) | | | | | | | | | | | (3,492 | ) | | | | | | | | |
| Assets held for sale | | | 743,594 | | | | 22,275 | | | | 3.99 | % | | | 1,285,922 | | | | 38,732 | | | | 4.02 | % |
| Other assets | | | 293,561 | | | | | | | | | | | | 27,237 | | | | | | | | | |
| | | $ | 4,803,162 | | | | | | | | | | | $ | 4,505,276 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Liabilities and Shareholders' Equity: | | | | | | | | | | | | | | | | | | | | | | | | |
| Deposits: | | | | | | | | | | | | | | | | | | | | | | | | |
| Demand and interest checking | | $ | 4,122,409 | | | $ | 8,293 | | | | 0.27 | % | | $ | 3,759,427 | | | $ | 6,795 | | | | 0.24 | % |
| Savings and money market | | | 323,307 | | | | 1,286 | | | | 0.53 | % | | | 380,671 | | | | 1,229 | | | | 0.43 | % |
| Time | | | 1,066 | | | | 12 | | | | 1.50 | % | | | 9,624 | | | | 83 | | | | 1.15 | % |
| Total deposits | | | 4,446,782 | | | | 9,591 | | | | 0.29 | % | | | 4,149,722 | | | | 8,107 | | | | 0.26 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Short-term borrowings | | | - | | | | - | | | | 0.00 | % | | | 7 | | | | - | | | | 0.00 | % |
| Repurchase agreements | | | 6,598 | | | | 14 | | | | 0.28 | % | | | 17,262 | | | | 37 | | | | 0.29 | % |
| Subordinated debt | | | 13,401 | | | | 328 | | | | 3.26 | % | | | 13,401 | | | | 344 | | | | 3.42 | % |
| Total deposits and interest bearing liabilities | | | 4,466,781 | | | | 9,933 | | | | 0.30 | % | | | 4,180,392 | | | | 8,488 | | | | 0.27 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Other liabilities | | | 9,702 | | | | | | | | | | | | 16,873 | | | | | | | | | |
| Total liabilities | | | 4,476,483 | | | | | | | | | | | | 4,197,265 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Shareholders' equity | | | 326,679 | | | | | | | | | | | | 308,011 | | | | | | | | | |
| | | $ | 4,803,162 | | | | | | | | | | | $ | 4,505,276 | | | | | | | | | |
| Net interest income on tax equivalent basis* | | | | | | | 79,115 | | | | | | | | | | | | 87,104 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Tax equivalent adjustment | | | | | | | 5,491 | | | | | | | | | | | | 4,662 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest income | | | | | | $ | 73,624 | | | | | | | | | | | $ | 82,442 | | | | | |
| Net interest margin * | | | | | | | | | | | 2.32 | % | | | | | | | | | | | 2.59 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| * Full taxable equivalent basis, using a 35% statutory tax rate. | | | | | | | | | | | | | | | | | | | | | | | | |
| ** Includes loans held for sale. | | | | | | | | | | | | | | | | | | | | | | | | |
| Allowance for loan and lease losses: | | Nine months ended | | | Year ended | | | | |
| | | September 30, | | | September 30, | | | December 31, | | | | |
| | | 2015 | | | 2014 | | | 2014 | | | | |
| | | (dollars in thousands) | | | | |
| | | | | | | | | | | | | |
| Balance in the allowance for loan and lease losses at beginning of period (1) | | $ | 3,638 | | | $ | 3,881 | | | $ | 3,881 | | | | |
| | | | | | | | | | | | | | | | |
| Loans charged-off: | | | | | | | | | | | | | | | |
| SBA non real estate | | | 66 | | | | 42 | | | | 307 | | | | |
| Direct lease financing | | | 9 | | | | 323 | | | | 323 | | | | |
| SBLOC | | | - | | | | - | | | | 3 | | | | |
| Other consumer loans | | | 1,176 | | | | 847 | | | | 871 | | | | |
| Total | | | 1,251 | | | | 1,212 | | | | 1,504 | | | | |
| | | | | | | | | | | | | | | | |
| Recoveries: | | | | | | | | | | | | | | | |
| SBA non real estate | | | - | | | | - | | | | 12 | | | | |
| Direct lease financing | | | - | | | | - | | | | 25 | | | | |
| Other consumer loans | | | 7 | | | | 25 | | | | 22 | | | | |
| Total | | | 7 | | | | 25 | | | | 59 | | | | |
| Net charge-offs | | | 1,244 | | | | 1,187 | | | | 1,445 | | | | |
| Provision charged to operations | | | 1,800 | | | | 2,606 | | | | 1,202 | | | | |
| | | | | | | | | | | | | | | | |
| Balance in allowance for loan and lease losses at end of period | | $ | 4,194 | | | $ | 5,300 | | | $ | 3,638 | | | | |
| Net charge-offs/average loans | | | 0.10 | % | | | 0.14 | % | | | 0.16 | % | | | |
| Net charge-offs/average loans (annualized) | | | 0.14 | % | | | 0.18 | % | | | 0.16 | % | | | |
| Net charge-offs/average assets | | | 0.03 | % | | | 0.03 | % | | | 0.03 | % | | | |
| (1) Excludes activity from assets held for sale | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
| Loan portfolio: | | September 30, | | | June 30, | | | March 31, | | | September 30, | |
| | | | 2015 | | | | 2015 | | | | 2015 | | | | 2014 | |
| | | (dollars in thousands) | |
| | | | | | | | | | | | | | | | | |
| SBA non real estate | | $ | 64,988 | | | $ | 63,390 | | | $ | 62,385 | | | $ | 56,773 | |
| SBA commercial mortgage | | | 116,545 | | | | 85,234 | | | | 84,430 | | | | 95,492 | |
| SBA construction | | | 5,191 | | | | 16,977 | | | | 15,181 | | | | 16,472 | |
| Total SBA loans | | | 186,724 | | | | 165,601 | | | | 161,996 | | | | 168,737 | |
| Direct lease financing | | | 223,929 | | | | 222,169 | | | | 220,559 | | | | 201,825 | |
| SBLOC | | | 539,240 | | | | 512,269 | | | | 447,649 | | | | 399,365 | |
| Other specialty lending | | | 12,119 | | | | 32,118 | | | | 1,862 | | | | 36,247 | |
| Other consumer loans | | | 23,502 | | | | 27,044 | | | | 30,120 | | | | 41,854 | |
| | | | 985,514 | | | | 959,201 | | | | 862,186 | | | | 848,028 | |
| Unamortized loan fees and costs | | | 9,004 | | | | 8,832 | | | | 8,715 | | | | 8,400 | |
| Total loans, net of deferred loan fees and costs | | $ | 994,518 | | | $ | 968,033 | | | $ | 870,901 | | | $ | 856,428 | |
| | | | | | | | | | | | | | | | | |
| Small business lending portfolio: | | September 30, | | | June 30, | | | March 31, | | | September 30, | |
| | | | 2015 | | | | 2015 | | | | 2015 | | | | 2014 | |
| | | (dollars in thousands) | |
| | | | | | | | | | | | | | | | | |
| SBA loans, including deferred fees and costs | | | 194,612 | | | | 173,357 | | | | 169,721 | | | | 176,401 | |
| SBA loans included in HFS | | | 86,245 | | | | 65,885 | | | | 52,219 | | | | 31,332 | |
| Total SBA loans | | $ | 280,857 | | | $ | 239,242 | | | $ | 221,940 | | | $ | 207,734 | |
| | Tier 1 capital | | | Tier 1 capital | | | Total capital | | | Common equity | |
| | | to average | | | to risk-weighted | | | to risk-weighted | | | tier 1 to risk | |
| | | assets ratio | | | assets ratio | | | assets ratio | | | weighted assets | |
| As of September 30, 2015 | | | | | | | | | | | | |
| The Bancorp | | | 6.27 | % | | | 14.14 | % | | | 14.35 | % | | | 14.14 | % |
| The Bancorp Bank | | | 5.97 | % | | | 13.47 | % | | | 13.67 | % | | | 13.47 | % |
| "Well capitalized" institution (under FDIC regulations) | | | 5.00 | % | | | 6.00 | % | | | 10.00 | % | | | 6.50 | % |
| | | | | | | | | | | | | | | | | |
| As of December 31, 2014 | | | | | | | | | | | | | | | | |
| The Bancorp | | | 7.07 | % | | | 11.54 | % | | | 11.67 | % | | | n/a | |
| The Bancorp Bank | | | 6.46 | % | | | 10.46 | % | | | 10.59 | % | | | n/a | |
| "Well capitalized" institution (under FDIC regulations) | | | 5.00 | % | | | 6.00 | % | | | 10.00 | % | | | n/a | |
| | | Three months ended | | | Nine months ended | |
| | | September 30, | | | September 30, | |
| | | 2015 | | | 2014 | | | 2015 | | | 2014 | |
| Selected operating ratios: | | | | | | | | | | | | |
| Net interest margin | | | 2.34 | % | | | 2.81 | % | | | 2.32 | % | | | 2.59 | % |
| Book value per share | | $ | 8.31 | | | $ | 7.88 | | | $ | 8.31 | | | $ | 7.88 | |
| | | | | | | | | | | | | | | | | |
| | | September 30, | | | June 30, | | | March 31, | | | September 30, | |
| | | | 2015 | | | | 2015 | | | | 2015 | | | | 2014 | |
| Asset quality ratios: | | | | | | | | | | | | | | | | |
| Nonperforming loans to total loans (1) | | | 0.25 | % | | | 0.34 | % | | | 0.52 | % | | | 0.56 | % |
| Nonperforming assets to total assets (1) | | | 0.05 | % | | | 0.07 | % | | | 0.09 | % | | | 0.13 | % |
| Allowance for loan and lease losses to total loans | | | 0.42 | % | | | 0.45 | % | | | 0.49 | % | | | 0.62 | % |
| | | | | | | | | | | | | | | | | |
| Nonaccrual loans | | $ | 2,157 | | | $ | 2,666 | | | $ | 3,744 | | | $ | 4,495 | |
| Other real estate owned | | | - | | | | - | | | | - | | | | 725 | |
| Total nonperforming assets | | $ | 2,157 | | | $ | 2,666 | | | $ | 3,744 | | | $ | 5,220 | |
| | | | | | | | | | | | | | | | | |
| Loans 90 days past due still accruing interest | | $ | 294 | | | $ | 620 | | | $ | 769 | | | $ | 264 | |
| | | | | | | | | | | | | | | | | |
| (1) Nonperforming loan and asset ratios include nonaccrual loans and loans 90 days past due still accruing interest. | |
| | | | | | | | | | | | | | | | | |
| | | Three months ended | |
| | | September 30, | | | June 30, | | | March 31, | | | September 30, | |
| | | | 2015 | | | | 2015 | | | | 2015 | | | | 2014 | |
| Gross dollar volume (GDV): | | | | | | | | | | | | | | | | |
| Prepaid card GDV | | $ | 9,465,687 | | | $ | 10,006,333 | | | $ | 11,712,072 | | | $ | 9,323,312 | |
