The Bancorp, Inc. (TBBK) 8-K The Bancorp, Inc. Reports First Quarter 2010 Financial Results

The Bancorp, Inc. Reports First Quarter 2010 Financial Results

Wilmington, Delaware - April 26, 2010 - The Bancorp, Inc. ("Bancorp") (NASDAQ: TBBK), a bank holding company, today reported results for the quarter ended March 31, 2010.

Financial Highlights

• Net income increased 80% or $1.0 million over the first quarter 2009 to $2.2 million, prior to $6.2 million in total after-tax TARP repayment related costs, resulting in a net loss available to common shareholders of $4.1 million or $0.15 per share
• Non-interest income increased 46% or $1.5 million, excluding securities gains, over first quarter 2009
• Net interest income increased $1.5 million, or 10% over the first quarter 2009
• Interest expense on deposits decreased to 0.65% for first quarter of 2010 from 1.06% for the first quarter of 2009
• Total deposits increased 26% or $385.4 million over first quarter 2009
• Transaction account balances represented 99% of total deposit balances at March 31, 2010
• Non-performing loans to total loans decreased to 1.44% compared to 1.72% on March 31, 2009 and 1.66% at year end 2009

Betsy Z. Cohen, Bancorp's Chief Executive Officer, said, "Our core earnings categories of net interest income, non-interest income, and net income all grew during the quarter. We repaid $45.2 million in TARP funds which, looking forward, we expect will restore $5.8 million in pre-tax income, annually. Significant growth in deposits included a 43% annual increase in health savings account deposits and a 38% annual increase or $508 million in total transaction accounts. Bancorp's total interest costs decreased to 0.65% for the quarter."

Financial Results

Bancorp reported a net loss available to common shareholders for the three months ended March 31, 2010 of $4.1 million, or a loss per share of $0.15, reflecting total after-tax TARP-related costs of $6.2 million, based on 26,181,291 weighted average shares outstanding, compared to net income available to common shareholders of $363,000, or earnings per share of $0.03, reflecting after-tax TARP charges of $831,000, based on 14,563,919 weighted average shares outstanding, for the three months ended March 31, 2009.

On March 10, 2010, Bancorp repaid the entire $45.2 million of fixed rate Series B preferred shares issued to the United States Treasury under its Capital Purchase Program. As a result of the repayment, a non-cash charge of $5.8 million was recognized during the quarter and $3.7 million of annualized dividends and accretion which previously reduced earnings have been eliminated on a going forward basis. Those charges equate to approximately $5.8 million of additional annual earnings capacity on a pre-tax basis. After the repayment Bancorp's capital ratios continue to exceed well capitalized requirements.

Core Operating Earnings (1)	March 31,		December 31,		September 30,		June 30,	March 31,
	2010		2009		2009		2009	2009
	(dollars in thousands)
Net income (loss) available to common shareholders	$        (4,056)		$          (932)		$            786		$            125	$            363
Add (deduct):
Preferred stock dividend and accretion	6,242	965		966		982		847
Income tax expense	1,233	17		818		632		781
Provision for loan and lease losses	4,148	4,000		3,500		2,500		3,000
Loss on other real estate owned	-	-		-		1,700		-
Subtotal	7,567		4,050		6,070		5,939	4,991
Gains and losses on securities	(750)		1,789		-		(670)	-
Core operating earnings for the three months ended	$         6,817		$         5,839		$         6,070		$         5,269	$         4,991

1. As a supplement to GAAP, Bancorp has provided this non-GAAP performance result. The Company believes that this non-GAAP financial measure is useful because it allows investors to assess its operating performance. Although this non-GAAP financial measure is intended to enhance investors' understanding of the Company's business and performance, it should not be considered an alternative to GAAP.

Capital Ratios

	Tier 1 capital	Tier 1 capital	Total capital
	to average	to risk-weighted	to risk-weighted
	assets ratio	assets ratio	assets ratio
As of March 31, 2010
The Bancorp, Inc.	8.64%	13.08%	14.33%
The Bancorp Bank	7.41%	11.23%	12.48%
"Well capitalized" institution (under FDIC regulations)	5.00%	6.00%	10.00%
As of December 31, 2009
The Bancorp, Inc.	12.68%	15.81%	17.06%
The Bancorp Bank	8.78%	10.97%	12.22%
"Well capitalized" institution (under FDIC regulations)	5.00%	6.00%	10.00%

Balance Sheet Summary

At March 31, 2010, Bancorp's total assets were $2.1 billion, an increase of $49.0 million or 2% from December 31, 2009. Investments increased to $177.7 million, an increase of $62.7 million or 55% and deposits increased to $1.9 billion, an increase of $207.8 million or 13%, over December 31, 2009.

Conference Call Webcast

You may access the LIVE webcast of Bancorp's Quarterly Earnings Conference Call at 10:00 AM EDT Monday, April 26, 2010 by clicking on the webcast link on Bancorp's homepage at www.thebancorp.com. Or, you may dial 866.356.3095 using access code 40883618. You may listen to the replay of the webcast following the live call on Bancorp's investor relations website or telephonically until Monday, May 03, 2010 by dialing 888.286.8010, access code 31649563.

About Bancorp

The Bancorp, Inc. is a bank holding company that operates The Bancorp Bank, an FDIC-insured commercial bank that delivers a full array of financial services and products both directly and through private-label affinity programs nationwide. 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 these risks and uncertainties, see The Bancorp, Inc.'s filings with the SEC, including the "Risk Factors" section 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 circumstance s 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

andres.viroslav@thebancorp.com

The Bancorp, Inc.
Financial highlights
(unaudited)
		Three months ended
		March 31,				December 31,
		2010		2009		2009
		(dollars in thousands except per share data)
Condensed statement of operations
Net interest income	$	16,418	$	14,916	$	16,849
Provision for loan and lease losses		4,148		3,000		4,000
Non-interest income Gains (losses) on investment securities
		750		-		(1,789)
Other non-interest income		4,849		3,328		3,364
Total non-interest income		5,599		3,328		1,575
Non-interest expense		14,450		13,253		14,374
Net income before income tax expense		3,419		1,991		50
Income tax expense		1,233		781		17
Net income		2,186		1,210		33
Less preferred stock dividends		(433)		(582)		(565)
Less preferred stock accretion		(5,809)		(265)		(400)
Net income (loss) available to common shareholders	$	(4,056)	$	363	$	(932)
Basic earnings (loss) per share	$	(0.15)	$	0.03	$	(0.04)
Diluted earnings (loss) per share	$	(0.15)	$	0.03	$	(0.04)
Weighted average shares - basic		26,181,291		14,563,919		26,181,291
Weighted average shares - diluted		26,181,291		14,563,919		26,181,291

	Balance sheet					March 31,				December 31,				September 30,				March 31,
						2010				2009				2009				2009
						(dollars in thousands)
Assets:
Cash and cash equivalents
	Cash and due from banks			$		173,604		$		135,246		$		133,453		$		117,669
	Interest bearing deposits					164,829				219,213				1,033				2,046
	Federal funds sold					-				-				210,506				18,114
	Total cash and cash equivalents					338,433				354,459				344,992				137,829
Investment securities, available-for-sale, at fair value						156,191				93,478				117,839				86,045
Investment securities, held-to-maturity						21,488				21,468				23,549				23,535
Loans, net of deferred costs						1,527,691				1,523,722				1,513,131				1,471,556
Allowance for loan and lease losses						(20,357)				(19,123)				(18,436)				(18,977)
Loans, net						1,507,334				1,504,599				1,494,695				1,452,579
Premises and equipment, net						8,140				7,942				7,740				8,496
Accrued interest receivable						7,589				7,722				7,708				6,872
Intangible assets, net						9,755				10,005				10,255				10,755
Other real estate owned						648				459				-				4,600
Deferred tax asset, net						20,872				20,875				22,220				22,794
Other assets						22,063				22,527				12,036				13,567
		Total assets		$		2,092,513		$		2,043,534		$		2,041,034		$		1,767,072
Liabilities:
Deposits
	Demand (non-interest bearing)			$		973,116		$		506,641		$		787,393		$		479,765
	Savings, money market and interest checking					875,511				1,005,048				890,587				860,584
	Time deposits					1,317				125,255				71,000				116,046
	Time deposits, $100,000 and over					12,339				17,565				23,350				20,480
	Total deposits					1,862,283				1,654,509				1,772,330				1,476,875
Securities sold under agreements to repurchase						8,245				2,588				696				3,364
Short-term borrowings						-				100,000				-				86,000
Accrued interest payable						136				362				322				414
Subordinated debenture						13,401				13,401				13,401				13,401
Other liabilities						6,401				27,471				7,741				5,856
		Total liabilities		$		1,890,466		$		1,798,331		$		1,794,490		$		1,585,910
Shareholders' equity:
Preferred stock - authorized 5,000,000 shares, Series A, $0.01 par value					-				-				-				1
Series B, $1,000 liquidation value					-				39,411				39,010				39,293
Common stock - authorized, 50,000,000 shares of $1.00 par value					26,181				26,181				26,181				14,563
Additional paid-in capital					196,898				196,875				196,827				145,183
Accumulated deficit					(21,231)				(17,175)				(16,242)				(17,154)
Accumulated other comprehensive income (loss)					199				(89)				768				(724)
Total shareholders' equity					202,047				245,203				246,544				181,162
Total liabilities and shareholders' equity			$		2,092,513		$		2,043,534		$		2,041,034		$		1,767,072

	Average balance sheets and net interest income:		Three months ended March 31, 2010					Three months ended March 31, 2009
	(Dollars in thousands)		Average			Average		Average			Average
Assets:			Balance		Interest	Rate		Balance		Interest	Rate
Interest-earning assets:
	Loans net of unearned discount	$	1,518,631	$	17,972	4.73%	$	1,457,084	$	18,244	5.01%
	Investment securities-taxable		130,432		1,308	4.01%		109,761		1,077	3.93%
	Investment securities-nontaxable*		30,855		586	7.60%		-		-	-%
	Interest bearing deposits at Federal Reserve Bank		472,388		352	0.30%		2,033		3	0.58%
	Federal funds sold		-		-	-		98,215		93	0.38%
Net interest-earning assets			2,152,306		20,218	3.76%		1,667,093		19,417	4.66%
Allowance for loan and lease losses			(19,821)					(17,878)
Other assets			201,340					167,783
		$	2,333,825				$	1,816,998
Liabilities and Shareholders' equity:
Deposits:
	Demand (non-interest bearing)	$	950,319				$	536,532
	Interest bearing deposits
	Interest checking		539,757	$	1,744	1.29%		315,525	$	1,159	1.47%
	Savings and money market		544,758		1,499	1.10%		520,538		1,530	1.18%
	Time		50,270		133	1.05%		216,494		1,525	2.82%
	Total interest bearing deposits		1,134,785		3,376	1.19%		1,052,557		4,214	1.60%
Total deposits			2,085,104			0.65%		1,589,089			1.06%
Short-term borrowings			3,183		5	0.68%		24,400		49	0.80%
Repurchase agreements			4,774		7	0.59%		2,319		11	1.97%
Subordinated debt			13,401		215	6.42%		13,401		227	6.78%
Net interest bearing liabilities			1,156,143		3,603	1.25%		1,092,677		4,501	1.65%
Other liabilities			12,658					7,202
Total liabilities			2,119,120					1,636,411
Shareholders' equity			214,705					180,587
		$	2,333,825				$	1,816,998
	Net interest income on tax equivalent basis*				16,615					14,916
	Tax equivalent adjustment				197					-
	Net interest income			$	16,418				$	14,916
	Net interest margin *					3.09%					3.58%
* Taxable equivalent basis, using a 34% statutory tax rate

Allowance for loan and lease losses:			March 31,		March 31,		December 31,
			2010		2009		2009
			(dollars in thousands)
Balance in the allowance for loan and lease losses at beginning of period		$	19,123	$	17,361	$	17,361
Loans charged-off:
	Commercial		2,728		1,290		6,314
	Construction		-		26		4,546
	Lease financing		-		49		49
	Residential mortgage		223		-		328
	Consumer		44		21		127
	Total		2,995		1,386		11,364
Recoveries:
	Commercial		79		-		53
	Construction		1		1		32
	Lease financing		-		-		27
	Residential mortgage		-		-		12
	Consumer		1		1		2
	Total		81		2		126
Net charge-offs			2,914		1,384		11,238
Provision charged to operations			4,148		3,000		13,000
Balance in allowance for loan and lease losses at end of period		$	20,357	$	18,977	$	19,123
Net charge-offs/average loans			0.19%		0.09%		0.76%

Loan Portfolio:		March 31,		December 31,		September 30,		March 31,
		2010		2009		2009		2009
		Amount		Amount		Amount		Amount
		(dollars in thousands)
Commercial	$	413,361	$	402,232	$	394,316	$	348,765
Commercial mortgage (1)		557,713		569,434		562,611		506,337
Construction		206,275		207,184		227,226		309,411
Total commercial loans		1,177,349		1,178,850		1,184,153		1,164,513
Direct financing leases		81,904		78,802		81,097		83,326
Residential mortgage		89,005		85,759		75,413		60,282
Consumer loans and others		177,456		178,608		170,238		161,945
		1,525,714		1,522,019		1,510,901		1,470,066
Unamortized costs (fees)		1,977		1,703		2,230		1,490
Total loans, net of unamortized fees and costs	$	1,527,691	$	1,523,722	$	1,513,131	$	1,471,556
Supplemental loan data:
Construction 1-4 family	$	98,151	$	100,088	$	119,752	$	159,148
Construction commercial, acquisition and development		108,124		107,096		107,474		150,263
	$	206,275	$	207,184	$	227,226	$	309,411
(1) At March 31, 2010 our owner-occupied loans amounted to $105 million, or 18.9% of commercial mortgages.

	Three months ended			Year ended
	March 31,		December 31,	December 31,
	2010	2009	2009	2009
Selected operating ratios (1)
Return on average assets	0.37%	0.27%	0.01%	0.22%
Return on average equity	4.07%	2.68%	0.05%	1.99%
Net interest margin	3.09%	3.58%	3.84%	3.74%
Efficiency ratio	67.95%	72.64%	71.11%	73.29%
Book value per common share (2)	$ 7.72	$ 9.27	$ 7.64	$ 7.64
(1) Annualized
(2) Excludes Series B Preferred Shares issued to the US Treasury and the associated book value
	March 31,	December 31,	September 30,	March 31,
	2010	2009	2009	2009
	(dollars in thousands)
Asset quality ratios
Nonperforming loans to total loans (1)	1.44%	1.66%	1.77%	1.72%
Nonperforming assets to total assets (1)	1.08%	1.26%	1.31%	1.69%
Allowance for loan and lease losses to total loans	1.33%	1.26%	1.22%	1.29%
Nonaccrual loans	$ 17,863	$ 12,270	$ 11,776	$ 11,949
Total nonperforming loans	17,863	12,270	11,776	11,949
Other real estate owned	648	459	-	4,600
Total nonperforming assets	$ 18,511	$ 12,729	$ 11,776	$ 16,549
Loans 90 days past due still accruing interest	$ 4,071	$ 12,994	$ 15,012	$ 13,362
(1) Nonperforming loans are defined as nonaccrual loans and restructured loans. Loans 90 days past due and still accruing interest are also included in the above ratios.