GuruFocus Premium Membership

Serving Intelligent Investors since 2004. Only 96 cents a day.

Free Trial

Free 7-day Trial
All Articles and Columns »

Glen Burnie Bancorp Reports Operating Results (10-Q)

July 29, 2009 | About:

Glen Burnie Bancorp (GLBZ) filed Quarterly Report for the period ended 2009-06-30.

Glen Burnie Bancorp is a bank holding company that wholly owns The Bank of Glen Burnie a commercial bank serving northern Anne Arundel County and surrounding areas. The bank is engaged in the commercial and retail banking business including the acceptance of demand and time deposits and the origination of loans to individuals associations partnerships and corporations. The bank\'s real estate financing consists of residential first and second mortgage loans home equity lines of credit and commercial mortgage loans. Glen Burnie Bancorp has a market cap of $23.1 million; its shares were traded at around $8.62 with a P/E ratio of 71.8 and P/S ratio of 1.3. The dividend yield of Glen Burnie Bancorp stocks is 4.6%.

Highlight of Business Operations:

Net interest income before provision for credit losses, for the second quarter, was $2,993,000 in 2008 compared to $3,034,000 in 2009. Interest income for the second quarter increased from $4,492,000 in 2008 to $4,689,000 in 2009, a 4.39% increase. Total interest expense for the quarter increased from $1,499,000 in 2008 to $1,655,000 in 2009, a 10.41% increase. The Company realized consolidated net income of $490,000 for the second quarter of 2009 compared to consolidated net income of $604,000 for the second quarter of 2008, an 18.87% decrease. Year-to-date net interest income before provision for credit losses was $5,858,000 in 2008, compared to $5,899,000 in 2009, a 0.7% increase. Interest income year-to-date increased from $8,905,000 in 2008 to $9,222,000 in 2009, a 3.56% increase. Total interest expense year-to-date increased from $3,047,000 in 2008 to $3,323,000 in 2009, a 9.06% increase. The Company realized consolidated net income of $945,000 for the first six months of 2009 compared to consolidated net income of $1,140,000 for the first six months of 2008, a 17.11% decrease. The decrease in net income for the second quarter and year-to-date 2009 was primarily due to a larger provision for loan losses (an increase of $57,000 in the second quarter and $152,000 year to date), a provision for an additional FDIC assessment of $160,000 which is due in September (included in the other expense amount), interest expense on long-term borrowings from the Federal Home Loan Bank originated during the third quarter of 2008, and an increase in interest expense on deposits. This was partially offset by an increase on loan income and a decrease in income tax expense. In addition, income for 2008 includes dividends on the Company s holdings of FHLB stock, which dividends have been suspended in 2009.

General. Glen Burnie Bancorp, a Maryland corporation (the “Company”), and its subsidiaries, The Bank of Glen Burnie (the “Bank”) and GBB Properties, Inc., both Maryland corporations, and Glen Burnie Statutory Trust I, a Connecticut business trust, had consolidated net income of $490,000 ($0.18 basic and diluted loss per share) for the second quarter of 2009, compared to the second quarter 2008 consolidated net income of $604,000 ($0.20 basic and diluted earnings per share). Year-to-date consolidated net income was $945,000 ($0.34 basic and diluted loss per share) for the six months ended June 30, 2009, compared to consolidated net income of $1,140,000 ($0.38 basic and diluted earnings per share) for the six months ended June 30, 2008. The decrease for the second quarter and year-to-date was due to a provision for a special FDIC assessment due in September 2009, an increase in the provision for loan losses, additional long-term borrowings expense due to two additional FHLB advances taken in the third quarter of 2008, and an increase in interest expense on deposits, partially offset by an increase in loan income and a decrease in income tax expense.

Net Interest Income. The Company s consolidated net interest income prior to provision for credit losses for the three and six months ended June 30, 2009 was $3,034,000 and $5,899,000, respectively, compared to $2,993,000 and $5,858,000 for the same period in 2008, an increase of $41,000 (1.37%) for the three months and an increase of $41,000 (0.70%) for the six month period.

Provision for Credit Losses. The Company made a provision for credit losses of $209,000 and $359,000 during the three and six month period ended June 30, 2009 and $152,000 and $207,000 for credit losses during the three and six month period ended June 30, 2008. As of June 30, 2009, the allowance for credit losses equaled 176.45% of non-accrual and past due loans compared to 224.42% at December 31, 2008 and 211.87% at June 30, 2008. During the three and six month period ended June 30, 2009, the Company recorded net charge-offs of $388,000 and $583,000, compared to net charge-offs of $73,000 and $383,000 during the corresponding period of the prior year. On an annualized basis, net charge-offs for the 2009 period represent 0.49% of the average loan portfolio.

Other Expenses. Other expenses increased from $2,612,000 for the three month period ended June 30, 2008, to $2,748,000 for the corresponding 2009 period, a $136,000 (5.20%) increase. The increase for the three month period was primarily due to making a $120,000 provision for an additional Federal Deposit Insurance Corporation (FDIC) assessment which will be due in September. For the six month period, other expenses increased from $5,265,000 at June 30, 2008, to $5,367,000 for the corresponding 2009 period, a $102,000 (1.94%) increase. The increase for the six month period was primarily due to the making of a $160,000 provision for the additional FDIC assessment along with the $30,000 write-down, done in the first quarter, on the value of a Trust Preferred security. These increases were partially offset by a decrease in salaries and employee benefits.

Deposits as of June 30, 2009 totaled $296,540,000, which is an increase of $26,772,000 (9.92%) from $269,768,000 at December 31, 2008. Demand deposits as of June 30, 2009 totaled $68,305,000, which is an increase of $4,766,000 (7.50%) from $63,539,000 at December 31, 2008. NOW accounts as of June 30, 2009 totaled $24,272,000, which is an increase of $3,193,000 (15.15%) from $21,079,000 at December 31, 2008. Money market accounts as of June 30, 2009 totaled $15,144,000, which is an increase of $2,380,000 (18.65%), from $12,764,000 at December 31, 2008. Savings deposits as of June 30, 2009 totaled $49,061,000, which is an increase of $3,259,000 (7.12%) from $45,802,000 at December 31, 2008. Certificates of deposit over $100,000 totaled $32,395,000 on June 30, 2009, which is an increase of $4,512,000 (16.18%) from $27,883,000 at December 31, 2008. Other time deposits (made up of certificates of deposit less than $100,000 and individual retirement accounts) totaled $107,363,000 on June 30, 2009, which is a $8,662,000 (8.78%) increase from the $98,701,000 total at December 31, 2008. Management continues to believe that the growth in deposits was due in part to the ongoing instability in the stock market and the resulting reallocation of investment portfolios by the Bank s customers.

Read the The complete Report

Rating: 4.0/5 (1 vote)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK
Email Hide