Exhibit 99
[SANDY SPRING BANCORP LOGO]
NEWS RELEASE
FOR IMMEDIATE RELEASE
SANDY SPRING BANCORP REPORTS
IMPROVED FIRST QUARTER RESULTS
OLNEY, MARYLAND, April 19, 2005 -- Sandy Spring Bancorp, Inc., (Nasdaq-SASR) the
parent company of Sandy Spring Bank, today announced net income for the first
quarter of 2005 of $7.9 million ($.53 per diluted share) compared to $7.3
million ($.50 per diluted share) for the first quarter of 2004, an 8% increase.
"Decisive steps that we took in November to sell some of our securities and
pre-pay certain borrowings improved our net interest margin. In addition,
continued focus on our core businesses produced strong loan growth and a healthy
increase in total deposits since the first quarter of last year," said Hunter R.
Hollar, President and Chief Executive Officer of Sandy Spring Bancorp. "In
essence, we believe that our first quarter results indicate our ability to
execute the fundamentals of community banking and to restore our performance to
a high-performing category," said Hollar.
Return on average stockholders' equity was 16.20% for the first quarter of 2005,
compared to 15.00% for the same period in the prior year. Return on average
assets for the first quarter of 2005 was 1.39%, compared to 1.26% for the first
quarter of 2004.
Comparing March 31, 2005 balances to March 31, 2004, total assets declined 4% to
$2.3 billion due mainly to the balance sheet restructuring completed at the end
of 2004. Total deposits increased 8% to $1.7 billion, while total loans and
leases increased 22% to $1.5 billion compared to the prior year. At March 31,
2005, stockholders' equity totaled $199 million, a slight decrease from $200
million at year-end 2004, and represented 8.70% of total assets, compared to
8.42% at March 31, 2004.
Due to growth in the loan portfolio, the provision for loan and lease losses
totaled $100,000 for the first quarter of 2005 compared to no provision in the
first quarter of 2004. The allowance for loan and lease losses represented 1% of
outstanding loans at March 31, 2005.
The Company's management will host a conference call to discuss its first
quarter results today at 2:00 P.M. (ET). A live Web cast of the conference call
is available through the Investor Relations' section of the Sandy Spring Web
site at www.sandyspringbank.com.
DETAILED REVIEW OF FINANCIAL RESULTS
Comparing the first quarter of 2005 and 2004, net interest income increased by
$2.7 million, or 14%, due primarily to an improved net interest margin. The net
interest margin increased to 4.39% in 2005 from 3.81% in 2004 due primarily to
increased loan volume and the early payoff of FHLB advances in the fourth
quarter of 2004.
Noninterest income increased 3% in the first quarter of 2005 as compared to
2004. Insurance agency commissions increased 62% over 2004 due to higher
premiums from commercial property and casualty lines and the acquisition of the
Wolfe & Reichelt Insurance Agency in December 2004. In addition, trust fees
increased 16% due primarily to growth in assets under management and Visa(R)
check fees increased 16% reflecting a growing volume of electronic checking
transactions. These increases were offset by a decline of 11% in service charges
on deposit accounts due to lower commercial account fees and return check
charges, and a 29% decrease in fees on sales of investment products.
Noninterest expenses were $18.4 million in the first quarter of 2005 compared to
$16.7 million in 2004, an increase of $1.7 million or 10%. This increase was
primarily the result of increases in salaries and benefits due largely to higher
incentive compensation and benefits expense and increased occupancy and
equipment expenses, due mainly to the opening of the Bank's Columbia Center
office facility in the second quarter of 2004. These increases were partially
offset by a decrease in marketing costs due mainly to the timing of marketing
initiatives between the two years.
ABOUT SANDY SPRING BANCORP/SANDY SPRING BANK
With $2.3 billion in assets, Sandy Spring Bancorp is the holding company for
Sandy Spring Bank and its principal subsidiaries, Sandy Spring Insurance
Corporation and The Equipment Leasing Company. Sandy Spring Bancorp is the third
largest publicly traded banking company headquartered in Maryland. Sandy Spring
is a community banking organization that focuses its lending and other services
on businesses and consumers in the local market area. Independent and
community-oriented, Sandy Spring Bank was founded in 1868 and offers a broad
range of commercial banking, retail banking and trust services through 30
community offices and 45 ATMs located in Anne Arundel, Carroll, Frederick,
Howard, Montgomery, and Prince George's counties in Maryland. Visit
www.sandyspringbank.com for more information.
For additional information or questions, please contact:
Hunter R. Hollar, President & Chief Executive Officer, or
Philip J. Mantua, Executive V.P. & Chief Financial Officer
Sandy Spring Bancorp
17801 Georgia Avenue
Olney, Maryland 20832
1-800-399-5919
E-mail: HHollar@sandyspringbank.com
PMantua@sandyspringbank.com
Web site: www.sandyspringbank.com
FORWARD-LOOKING STATEMENTS: Sandy Spring Bancorp makes forward-looking
statements in this News Release that are subject to risks and uncertainties.
These forward-looking statements include: statements of goals, intentions,
earnings expectations, and other expectations; estimates of risks and of future
costs and benefits; assessments of probable loan and lease losses; assessments
of market risk; and statements of the ability to achieve financial and other
goals. These forward-looking statements are subject to significant uncertainties
because they are based upon or are affected by: management's estimates and
projections of future interest rates, market behavior, and other economic
conditions; future laws and regulations; and a variety of other matters which,
by their nature, are subject to significant uncertainties. Because of these
uncertainties, Sandy Spring Bancorp's actual future results may differ
materially from those indicated. In addition, the Company's past results of
operations do not necessarily indicate its future results.
Sandy Spring Bancorp, Inc. and Subsidiaries
FINANCIAL HIGHLIGHTS
(Dollars in thousands, except per share data)
Three Months Ended
March 31,
----------------------- %
2005 2004 Change
- -------------------------------------------------------------------------------------------------------
PROFITABILITY FOR THE PERIOD:
Net interest income $21,200 $18,539 14
Provision for credit losses 100 0 N/A
Noninterest income 7,840 7,590 3
Noninterest expenses 18,437 16,714 10
Income before income taxes 10,503 9,415 12
Net income 7,856 7,301 8
Return on average assets 1.39% 1.26%
Return on average equity 16.20% 15.00%
Net interest margin 4.39% 3.81%
Efficiency ratio - GAAP based * 63.49% 63.97%
Efficiency ratio - traditional * 58.38% 58.24%
PER SHARE DATA:
Basic net income $0.54 $0.51 6
Diluted net income 0.53 0.50 6
Dividends declared 0.20 0.19 5
Book value 13.57 13.76 (1)
Tangible book value 12.35 12.48 (1)
Average fully diluted shares 14,760,551 14,725,261
AT PERIOD-END:
Assets $2,284,198 $2,371,572 (4)
Deposits 1,745,675 1,618,591 8
Loans and leases 1,468,814 1,202,229 22
Securities 618,089 965,492 (36)
Stockholders' equity 198,709 199,615 0
CAPITAL AND CREDIT QUALITY RATIOS:
Average equity to average assets 8.60% 8.40%
Allowance for credit losses to loans
and leases 1.00% 1.24%
Nonperforming assets to total assets 0.10% 0.14%
Annualized net charge-offs to average
loans and leases 0.00% 0.00%
* The GAAP based efficiency ratio is noninterest expenses divided by net
interest income plus noninterest income from the Consolidated Statements of
Income. The traditional, non-GAAP efficiency ratio excludes intangible asset
amortization from noninterest expenses; excludes securities gains from
noninterest income; and adds the tax-equivalent adjustment to net interest
income. See the Reconciliation Table included with these Financial
Highlights.
Certain reclassifications and restatements of information previously reported
have been made to conform with current presentation.
Sandy Spring Bancorp, Inc. and Subsidiaries
RECONCILIATION OF GAAP-BASED AND TRADITIONAL EFFICIENCY RATIOS
(In thousands, except per share data)
Three Months Ended
March 31,
------------------------------------------
2005 2004
-------------------- --------------------
Noninterest expenses-GAAP based $18,437 $16,714
Net interest income plus noninterest income-
GAAP based 29,040 26,129
Efficiency ratio-GAAP based 63.49% 63.97%
==================== ====================
Noninterest expenses-GAAP based $18,437 $16,714
Less non-GAAP adjustment:
Amortization of intangible assets 496 486
-------------------- --------------------
Noninterest expenses-traditional ratio 17,941 16,228
Net interest income plus noninterest income-
GAAP based 29,040 26,129
Plus non-GAAP adjustment:
Tax-equivalency 1,709 1,965
Less non-GAAP adjustments:
Securities gains 15 228
-------------------- --------------------
Net interest income plus noninterest
income - traditional ratio 30,734 27,866
Efficiency ratio - traditional 58.38% 58.24%
==================== ====================
Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share data)
March 31 December 31
------------------------------------------- --------------------
2005 2004 2004
- ------------------------------------------------------------------------------------------------------------- --------------------
ASSETS
Cash and due from banks $43,905 $43,338 $43,728
Federal funds sold 6,240 20,942 5,467
Interest-bearing deposits with banks 838 708 610
Residential mortgage loans held for sale 14,329 19,896 16,211
Investments available-for-sale (at fair value) 300,446 636,739 346,903
Investments held-to-maturity - fair value of $310,340
$318,984 and $312,661, respectively 304,909 308,901 305,293
Other equity securities 12,734 19,852 13,912
Total loans and leases 1,468,814 1,202,229 1,445,525
Less: allowance for credit losses (14,738) (14,875) (14,654)
-------------------- -------------------- --------------------
Net loans and leases 1,454,076 1,187,354 1,430,871
Premises and equipment, net 44,292 39,216 42,054
Accrued interest receivable 11,776 12,537 11,674
Goodwill 8,554 7,642 7,335
Other intangible assets, net 9,370 10,959 9,866
Other assets 72,729 63,488 75,419
-------------------- -------------------- --------------------
Total assets $2,284,198 $2,371,572 $2,309,343
==================== ==================== ====================
Liabilities
Noninterest-bearing deposits $428,906 $402,759 $423,868
Interest-bearing deposits 1,316,769 1,215,832 1,308,633
-------------------- -------------------- --------------------
Total deposits 1,745,675 1,618,591 1,732,501
Short-term borrowings 259,341 382,367 231,927
Subordinated debentures 35,000 35,000 35,000
Other long-term borrowings 29,421 114,971 94,608
Accrued interest payable and other liabilities 16,052 21,028 20,224
-------------------- -------------------- --------------------
Total liabilities 2,085,489 2,171,957 2,114,260
Stockholders' Equity
Common stock -- par value $1.00; shares authorized
50,000,000; shares issued and outstanding 14,642,686,
14,509,706 and 14,628,511, respectively 14,643 14,510 14,629
Additional paid in capital 21,839 19,293 21,522
Retained earnings 161,242 157,825 156,315
Accumulated other comprehensive income 985 7,987 2,617
-------------------- -------------------- --------------------
Total stockholders' equity 198,709 199,615 195,083
-------------------- -------------------- --------------------
Total liabilities and stockholders' equity $2,284,198 $2,371,572 $2,309,343
==================== ==================== ====================
Certain reclassifications and restatements of information previously reported
have been made to conform with current presentation.
Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
Three Months Ended
March 31,
-------------------------------------------
2005 2004
-------------------- --------------------
Interest income:
Interest and fees on loans and leases $21,041 $16,369
Interest on loans held for sale 167 138
Interest on deposits with banks 4 3
Interest and dividends on securities:
Taxable 3,328 6,556
Exempt from federal income taxes 3,594 3,587
Interest on federal funds sold 53 59
-------------------- --------------------
Total interest income 28,187 26,712
Interest expense:
Interest on deposits 4,188 2,730
Interest on short-term borrowings 2,018 3,751
Interest on long-term borrowings 781 1,692
-------------------- --------------------
Total interest expense 6,987 8,173
-------------------- --------------------
Net interest income 21,200 18,539
Provision for credit losses 100 0
-------------------- --------------------
Net interest income after provision for credit losses 21,100 18,539
Noninterest income:
Securities gains 15 228
Service charges on deposit accounts 1,671 1,868
Gains on sales of mortgage loans 731 769
Fees on sales of investment products 445 629
Trust department income 872 754
Insurance agency commissions 1,811 1,121
Income from bank owned life insurance 555 574
Visa check fees 491 424
Other income 1,249 1,223
-------------------- --------------------
Total noninterest income 7,840 7,590
Noninterest expenses:
Salaries and employee benefits 11,289 9,877
Occupancy expense of premises 1,924 1,628
Equipment expenses 1,322 1,190
Marketing 288 513
Outside data services 740 721
Amortization of intangible assets 496 486
Other expenses 2,378 2,299
-------------------- --------------------
Total noninterest expenses 18,437 16,714
-------------------- --------------------
Income before income taxes 10,503 9,415
Income tax expense 2,647 2,114
-------------------- --------------------
Net income $7,856 $7,301
==================== ====================
Basic net income per share $0.54 $0.51
Diluted net income per share 0.53 0.50
Dividends declared per share 0.20 0.19
Certain reclassifications and restatements of information previously reported
have been made to conform with current presentation.
Sandy Spring Bancorp, Inc. and Subsidiaries
HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA
2005 2004
------------- ----------------------------------------------------
(Dollars in thousands, except per share data) Q1 Q4 Q3 Q2 Q1
- ----------------------------------------------------------------- ----------------------------------------------------
PROFITABILITY FOR THE QUARTER:
Tax-equivalent interest income $29,896 $30,614 $29,776 $28,070 $28,677
Interest expense 6,987 8,890 9,322 8,383 8,173
Tax-equivalent net interest income 22,909 21,724 20,454 19,687 20,504
Tax-equivalent adjustment 1,709 2,097 2,175 1,919 1,965
Provision for credit losses 100 0 0 0 0
Noninterest income 7,840 7,628 7,452 8,279 7,590
Noninterest expenses 18,437 39,778 17,883 18,099 16,714
Income before income taxes 10,503 (12,523) 7,848 7,948 9,415
Income tax expense 2,647 (6,779) 1,431 1,555 2,114
Net Income 7,856 (5,744) 6,417 6,393 7,301
======================================================================================================================
Financial ratios:
Return on average assets 1.39% (0.94)% 1.03% 1.08% 1.26%
Return on average equity 16.20% (11.45)% 12.89% 13.07% 15.00%
Net interest margin 4.39% 3.80% 3.54% 3.56% 3.81%
Efficiency ratio - GAAP based * 63.49% 145.95% 69.50% 69.49% 63.97%
Efficiency ratio - traditional * 58.38% 67.12% 62.65% 63.22% 58.24%
======================================================================================================================
Per share data:
Basic net income $0.54 ($0.40) $0.44 $0.44 $0.51
Diluted net income $0.53 ($0.39) $0.44 $0.43 $0.50
Dividends declared $0.20 $0.20 $0.20 $0.19 $0.19
Book value $13.57 $13.34 $13.92 $13.51 $13.76
Tangible book value $12.35 $12.16 $12.70 $12.26 $12.48
Average fully diluted shares 14,760,551 14,720,013 14,673,756 14,726,117 14,725,261
======================================================================================================================
Noninterest income breakdown:
Securities gains $15 $65 $138 $109 $228
Service charges on deposit accounts 1,671 1,846 1,886 1,881 1,868
Gains on sales of mortgage loans 731 772 714 1,028 769
Fees on sales of investment products 445 702 475 666 629
Trust department income 872 801 813 984 754
Insurance agency commissions 1,811 1,040 944 1,030 1,121
Income from bank owned life insurance 555 560 556 557 574
Income from early termination of a sublease 0 0 0 0 0
Visa check fees 491 537 498 497 424
Other income 1,249 1,305 1,428 1,527 1,223
Total 7,840 7,628 7,452 8,279 7,590
======================================================================================================================
Noninterest expense breakdown:
Salaries and employee benefits $11,289 $11,133 $10,295 $10,229 $9,877
Occupancy expense of premises 1,924 1,925 1,861 1,815 1,628
Equipment expenses 1,322 1,534 1,380 1,324 1,190
Marketing 288 337 385 482 513
Outside data services 740 722 697 766 721
* The GAAP based efficiency ratio is noninterest expenses divided by net
interest income plus noninterest income from the Consolidated Statements of
Income. The traditional, non-GAAP efficiency ratio excludes intangible asset
amortization, FHLB prepayment penalties and goodwill impairment loss from
noninterest expenses; excludes security gains from noninterest income; and
adds the tax-equivalent adjustment to net interest income. See the
Reconciliation Table included with these Historical Trends in Quarterly
Financial Data.
Sandy Spring Bancorp, Inc. and Subsidiaries
HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA
2005 2004
------------- ----------------------------------------------------
(Dollars in thousands, except per share data) Q1 Q4 Q3 Q2 Q1
- ----------------------------------------------------------------- ----------------------------------------------------
NONINTEREST EXPENSE BREAKDOWN (CONTINUED):
Amortization of intangible assets $496 $491 $486 $487 $486
Gooodwill impairment loss 0 1,265 0 0 0
Other expenses 2,378 22,371 2,779 2,996 2,299
Total 18,437 39,778 17,883 18,099 16,714
========================================================================================================================
BALANCE SHEETS AT QUARTER END:
Residential mortgage loans $375,746 $371,924 $365,352 $343,176 $337,850
Residential construction loans 139,964 137,880 126,338 113,382 103,292
Commercial mortgage loans 395,528 386,911 372,790 329,894 322,754
Commercial construction loans 94,708 88,974 62,436 55,563 52,162
Commercial loans and leases 150,143 150,734 138,741 140,560 125,527
Consumer loans 312,725 309,102 299,826 284,771 260,644
Total loans and leases 1,468,814 1,445,525 1,365,483 1,267,346 1,202,229
Less: allowance for credit losses (14,738) (14,654) (14,792) (14,743) (14,875)
Net loans and leases 1,454,076 1,430,871 1,350,691 1,252,603 1,187,354
Goodwill 8,554 7,335 7,642 7,642 7,642
Other intangible assets, net 9,370 9,866 9,987 10,473 10,959
Total assets 2,284,198 2,309,343 2,506,302 2,424,199 2,371,572
Total deposits 1,745,675 1,732,501 1,709,642 1,681,552 1,618,591
Total stockholders' equity 198,709 195,083 201,737 196,090 199,615
========================================================================================================================
QUARTERLY AVERAGE BALANCE SHEETS:
Residential mortgage loans $384,504 $378,347 $362,170 $355,676 $346,545
Residential construction loans 137,897 135,322 119,989 108,118 93,722
Commercial mortgage loans 389,215 379,857 347,451 327,441 316,768
Commercial construction loans 91,733 71,930 61,771 55,234 51,519
Commercial loans and leases 149,783 139,165 137,321 134,627 127,327
Consumer loans 310,421 303,639 293,025 268,861 251,411
Total loans and leases 1,463,553 1,408,260 1,321,727 1,249,957 1,187,292
Securities 641,960 801,871 938,448 933,253 954,822
Total earning assets 2,115,369 2,272,437 2,299,895 2,220,656 2,167,641
Total assets 2,286,209 2,441,129 2,466,535 2,384,929 2,329,107
Total interest-bearing liabilities 1,660,839 1,805,091 1,844,996 1,775,867 1,751,225
Noninterest-bearing demand deposits 415,824 419,723 405,647 392,387 360,341
Total deposits 1,723,667 1,727,800 1,684,328 1,634,340 1,561,666
Stockholders' equity 196,659 199,626 198,030 196,719 195,730
========================================================================================================================
CAPITAL AND CREDIT QUALITY MEASURES:
Average equity to average assets 8.60% 8.18% 8.03% 8.25% 8.40%
Credit loss allowance to loans and leases 1.00% 1.01% 1.08% 1.16% 1.24%
Nonperforming assets to total assets 0.10% 0.08% 0.09% 0.12% 0.14%
Annualized net (charge-offs) recoveries to
average loans and leases 0.00% 0.04% (0.01)% 0.04% 0.00%
========================================================================================================================
MISCELLANEOUS DATA:
Net (charge-offs) recoveries ($16) $138 ($48) $131 $5
Nonperforming assets:
Non-accrual loans and leases 672 746 848 674 802
Loans and leases 90 days past due 1,531 1,043 1,340 2,316 2,492
Restructured loans and leases 0 0 0 0 0
Other real estate owned, net 73 0 0 0 77
Total nonperforming assets 2,276 1,789 2,188 2,990 3,371
========================================================================================================================
Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES
(Dollars in thousands and tax-equivalent)
Three Months Ended March 31,
---------------------------------------------------------------------------------
2005 2004
-------------------------------------- ----------------------------------------
AVERAGE ANNUALIZED YIELD/ Average Annualized Yield/
BALANCES INTEREST RATE Balances Interest Rate
--------------- ------------ -------- ---------------- ------------- ---------
ASSETS
Residential mortgage loans $384,504 $20,917 5.44 % $346,545 $18,783 5.42 %
Residential construction loans 137,897 8,093 5.87 93,722 4,303 4.59
Commercial mortgage loans 389,215 24,974 6.42 316,768 20,422 6.45
Commercial construction loans 91,733 5,877 6.41 51,519 2,956 5.74
Commercial loans and leases 149,783 9,989 6.67 127,327 8,184 6.43
Consumer loans 310,421 15,847 5.11 251,411 11,631 4.63
--------------- ------------ ---------------- -------------
Total loans and leases 1,463,553 85,697 5.86 1,187,292 66,279 5.58
Securities 641,960 35,191 5.48 954,822 48,528 5.08
Interest-bearing deposits with banks 827 17 2.06 1,000 10 1.00
Federal funds sold 9,029 213 2.36 24,527 235 0.96
--------------- ------------ ---------------- -------------
TOTAL EARNING ASSETS 2,115,369 121,118 5.73 % 2,167,641 115,052 5.31 %
Less: allowance for credit losses (14,664) (14,889)
Cash and due from banks 43,385 39,580
Premises and equipment, net 43,129 38,699
Other assets 98,990 98,076
--------------- ----------------
Total assets $2,286,209 $2,329,107
=============== ================
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing demand deposits $237,637 $597 0.25 % $223,986 $614 0.27 %
Regular savings deposits 227,250 729 0.32 195,286 661 0.34
Money market savings deposits 375,483 4,388 1.17 375,140 1,987 0.53
Time deposits 467,473 11,272 2.41 406,913 7,716 1.90
--------------- ------------ ---------------- -------------
Total interest-bearing deposits 1,307,843 16,986 1.30 1,201,325 10,978 0.91
Borrowings 352,996 11,225 3.18 549,900 21,563 3.92
--------------- ------------ ---------------- -------------
TOTAL INTEREST-BEARING LIABILITIES 1,660,839 28,211 1.70 1,751,225 32,541 1.86
------------ ------- ------------- ---------
Net interest income and spread $92,907 4.03 % $82,772 3.45 %
============ ======== ============= =========
Noninterest-bearing demand deposits 415,824 360,341
Other liabilities 12,887 21,811
Stockholder's equity 196,659 195,730
--------------- ----------------
Total liabilities and stockholders' equity $2,286,209 $2,329,107
=============== ================
Interest income/earning assets 5.73 % 5.31 %
Interest expense/earning assets 1.34 1.50
-------- ---------
Net interest margin 4.39 % 3.81 %
======== =========
* Interest income includes the effects of annualized taxable-equivalent
adjustments (reduced by the nondeductible portion of interest expense) using
the appropriate marginal federal income tax rate of 35.00% and, where
applicable, the marginal state income tax rate of 7.00% (or a combined
marginal federal and state rate of 39.55%), to increase tax-exempt interest
income to a taxable-equivalent basis. The annualized taxable-equivalent
adjustment amounts utilized in the above table to compute yields aggregated
to $6,931,000 in 2005 and $7,903,000 in 2004.