BLOOMINGTON, IN — Monroe Bancorp,
(Nasdaq:MROE), the independent Bloomington-based holding company
for Monroe Bank, reported second quarter 2003 diluted earnings
of $0.04 per share, a decline of $0.22 when compared to the
$0.26 earned during the second quarter of 2002. The earnings
for the second quarter of 2003 were impacted by a previously
announced $2,300,000 special provision ($1,389,000 after tax)
directly related to an analysis of the collateral values and
many other factors related to loans outstanding to a certain
real estate developer, who recently filed bankruptcy, and
to parties affiliated with the developer. Excluding the special
provision, diluted earnings per share for the second quarter
of 2003 would have been $0.27, a 3.8 percent increase over
the second quarter of 2002.
Before the special provision, the Company's net income
for the six months ended June 30, 2003 was $3,199,000 or
$0.52 per common share, compared to $3,062,000 and $0.50
per common share for the same period in 2002, a 4.5 percent
increase in net income. With the special provision, the
six-month net income for 2003 is $1,810,000 or $0.30 per
common share.
"While disappointed by the need for the special provision,
we are pleased with the sustained strong performance of
our core business activity during the second quarter," said
Mark D. Bradford, President and Chief Executive Officer. "We
continue to successfully seek new loan business, grow our
investment sales program and other sources of non-interest
income, and build upon the momentum gained in our Central
Indiana expansion. The special provision was a warranted
action, but it is one that has not deterred us from our
commitment to our strategic goals."
Fed by the favorable low interest rate environment and
the Company's consistent business development efforts,
loans for the Company, including loans held for sale of
$8,131,000, totaled $414,190,000 on June 30, 2003. The
year-over-year growth rate for the Company's loan portfolio,
excluding loans held for sale, was 6.9 percent. Nonperforming
assets and 90-day past due loans totaled $8,651,000, or
1.51 percent of total assets at June 30, 2003, compared
to $4,296,000 (0.81 percent) at June 30, 2002 and $10,194,000
(1.84 percent) at March 31, 2003.
The Company's mortgage business was strong in the second
quarter with income derived from the sale of fixed-rate
mortgages into the secondary market increasing 165.5 percent,
or $288,000 over the same quarter in 2002. Second quarter
2003 mortgages originated and sold into the secondary market
totaled $29,856,000, compared to $14,719,000 for the second
quarter of 2002, a 102.8 percent increase.
Non-interest income totaled $2,317,000 for the second
quarter of 2003 compared to $1,329,000 in the second quarter
of 2002. Included in non- interest income are net realized
and unrealized securities gains of $388,000 in the second
quarter of 2003 and losses of $146,000 in the second quarter
of 2002. Non-interest income, excluding net realized and
unrealized securities gains and losses increased $454,000,
or 30.8 percent over the quarter ended June 30, 2002. In
addition to the sale of fixed rate mortgages, the growth
in non-interest income was fueled by a $65,000 (14.7 percent)
increase in fee income from trust, brokerage services and
banking center-based investment sales. Trust assets under management
for the Company reached $177,502,000 at June 30, 2003,
growing 28.5 percent since June 30, 2002. In addition,
second quarter 2003 deposit-related fee income increased
5.7 percent over the same period in 2002.
Total deposits at June 30, 2003 were $430,336,000 compared
to $403,496,000 at June 30, 2002, an increase of 6.7 percent.
The Company's total assets at June 30, 2003 were $573,926,000,
which was 8.6 percent greater than the total at June 30,
2002.
Monroe Bancorp, headquartered in Bloomington, Indiana,
is an Indiana bank holding company with offices in Monroe,
Jackson, Lawrence and Hendricks counties. Its wholly owned
subsidiary, Monroe Bank, was established in Bloomington,
Indiana in 1892, and offers a full range of financial,
trust and investment services to its more than 22,000 retail
and commercial customers. The Company's common stock is
traded on the NASDAQ® National Stock Market under the symbol
MROE.
Forward-Looking Statements
This release contains forward-looking
statements about the Company which we believe are within
the meaning of the Private Securities Litigation Reform
Act of 1995. This release contains certain forward-looking
statements with respect to the financial condition, results
of operations, plans, objectives, future performance
and business of the Company. Forward-looking statements
can be identified by the fact that they do not relate
strictly to historical or current facts. They often include
the words "believe," "expect," "anticipate," "intend," "plan," "estimate" or
words of similar meaning, or future or conditional verbs
such as "will," "would," "should," "could" or "may" or
words of similar meaning. These forward-looking statements,
by their nature, are subject to risks and uncertainties.
There are a number of important factors that could cause
future results to differ materially from historical performance
and these forward-looking statements. Factors that might
cause such a difference include, but are not limited
to: (1) competitive pressures among depository institutions
increase significantly; (2) changes in the interest rate
environment reduce interest margins; (3) prepayment speeds,
charge-offs and loan loss provisions; (4) general economic
conditions, either national or in the markets in which
the Company does business, are less favorable than expected;
(5) legislative or regulatory changes adversely affect
the business of the Company; and (6) changes in real
estate values or the real estate markets. Further information
on other factors which could affect the financial results
of the Company are included in the Company's filings
with the Securities and Exchange Commission.
Income Statement With and Without Special $2.3 Million Provision
Quarter Ending
6/30/03 6/30/02
Without Impact With
Special of Special
Provision Provision Provision
INCOME STATEMENT
Net Interest Income $4,759 $4,759 $4,647
Loan Loss Provision 405 $2,300 2,705 276
Total Non-Interest Income 2,317 2,317 1,329
Service Charges on Deposit
Accounts 700 700 662
Trust Fees 230 230 239
Commission Income 277 277 203
Gain on Sale of Loans 462 462 174
Realized Gains (Losses) on
Securities 171 171 46
Unrealized Gains (Losses) on
Trading Securities
Associated with Directors'
Deferred Comp Plan 217 217 (192)
Other Operating Income 260 260 197
Total Non-Interest Expense 4,322 4,322 3,364
Salaries & Wages 1,528 1,528 1,522
Commissions & Incentive
Compensation 494 494 293
Employee Benefits 429 429 286
Premises & Equipment 567 567 600
Advertising 162 162 181
Legal Fees 147 147 33
Appreciation (Depreciation) in
Directors' Deferred Compensation
Plan 238 238 (178)
Other Operating Expenses 757 757 627
Income Before Income Tax 2,349 (2,300) 49 2,336
Income Tax Expense (Benefit) 698 (911) (213) 773
Net Income After Tax & Before
Extraordinary Items 1,651 262 1,563
Extraordinary Items - - -
Net Income $1,651 $(1,389) $262 $1,563
Basic Earnings Per Share $0.27 $(0.23) $0.04 $0.26
Diluted Earnings Per Share 0.27 (0.23) 0.04 0.26
Return on Average Equity 14.73% (12.39%) 2.34% 14.91%
Return on Average Assets 1.18% (.99%) 0.19% 1.21%
Income Statement With and Without Special $2.3 Million Provision
Six Months Ending
6/30/03 6/30/02
Without Impact With
Special of Special
Provision Provision Provision
INCOME STATEMENT
Net Interest Income $9,479 $9,479 $9,274
Loan Loss Provision 810 $2,300 3,110 552
Total Non-Interest Income 4,001 4,001 2,744
Service Charges on Deposit
Accounts 1,334 1,334 1,257
Trust Fees 503 503 456
Commission Income 463 463 411
Gain on Sale of Loans 826 826 393
Realized Gains (Losses) on
Securities 166 166 46
Unrealized Gains (Losses) on
Trading Securities
Associated with Directors'
Deferred Comp Plan 191 191 (205)
Other Operating Income 518 518 386
Total Non-Interest Expense 8,027 8,027 6,874
Salaries & Wages 3,055 3,055 2,966
Commissions & Incentive
Compensation 844 844 589
Employee Benefits 802 802 661
Premises & Equipment 1,205 1,205 1,195
Advertising 289 289 348
Legal Fees 248 248 69
Appreciation (Depreciation) in
Directors'
Deferred Compensation Plan 219 219 (178)
Other Operating Expenses 1,365 1,365 1,224
Income Before Income Tax 4,643 (2,300) 2,343 4,592
Income Tax Expense (Benefit) 1,444 (911) 533 1,530
Net Income After Tax & Before
Extraordinary Items 3,199 1,810 3,062
Extraordinary Items - - -
Net Income $3,199 $(1,389) $1,810 $3,062
Basic Earnings Per Share $0.52 $(0.23) $0.30 $0.50
Diluted Earnings Per Share $0.52 (0.23) $0.30 0.50
Return on Average Equity 14.37% (6.24%) 8.13% 14.84%
Return on Average Assets 1.17% (0.51%) 0.66% 1.21%
Monroe Bancorp (MROE)
Financial Summary
(dollar amounts in thousands except per share data)
Quarters Ending
June 2003 Mar 2003 Dec 2002
BALANCE SHEET *
Cash and Due from Banks $18,565 $16,057 $20,526
Federal Funds Sold 18,200 12,700 -
Securities 106,573 104,926 103,779
Total Loans 414,190 401,881 391,315
Loans Held for Sale 8,131 5,197 7,417
Commercial & Industrial 79,405 78,569 78,062
Real Estate:
Commercial & Residential 255,123 249,253 238,013
Construction & Vacant Land 30,697 28,173 27,470
Home Equity 20,032 18,964 17,927
Installment Loans 20,802 21,725 22,426
Reserve for Loan Losses 5,878 4,680 4,574
Bank Premises and Equipment 11,661 11,732 11,793
Federal Home Loan Bank Stock 2,274 2,124 1,882
Interest Receivable and Other Assets 8,341 8,680 8,596
Total Assets $573,926 $553,420 $533,317
Total Deposits $430,336 $418,670 $398,567
Non-Interest Checking 60,465 62,531 60,476
Interest Checking & NOW 96,004 78,883 81,160
Regular Savings 26,830 26,457 22,459
Money Market Savings 69,903 66,508 53,865
CDs Less than $100,000 98,347 102,196 99,930
CDs Greater than $100,000 68,279 71,089 69,910
Other Time 10,508 11,006 10,767
Total Borrowings 94,212 83,858 85,240
Federal Funds Purchased - - 10,050
Securities Sold Under Repurchase
Agreements 48,340 40,694 39,158
FHLB Advances 45,207 42,486 34,956
Loans Sold Under Repurchase
Agreement and
Other Notes Payable 665 678 1,076
Interest Payable and Other
Liabilities 4,620 5,908 5,247
Total Liabilities 529,168 508,436 489,054
Shareholders Equity 44,758 44,984 44,263
Total Liabilities and
Shareholders' Equity $573,926 $553,420 $533,317
Book Value Per Share $7.33 $7.37 $7.25
End of Period Shares Outstanding 6,106,467 6,105,151 6,103,869
* period end numbers
Monroe Bancorp (MROE)
Financial Summary
(dollar amounts in thousands except per share data)
Sept 2002 June 2002
BALANCE SHEET *
Cash and Due from Banks $16,705 $17,575
Federal Funds Sold - 9,200
Securities 103,715 102,222
Total Loans 390,364 381,267
Loans Held for Sale 8,276 1,344
Commercial & Industrial 76,431 76,847
Real Estate:
Commercial & Residential 236,212 235,721
Construction & Vacant Land 29,885 29,748
Home Equity 16,887 15,050
Installment Loans 22,673 22,557
Reserve for Loan Losses 3,931 4,186
Bank Premises and Equipment 11,923 11,977
Federal Home Loan Bank Stock 1,882 1,882
Interest Receivable and Other Assets 8,347 8,507
Total Assets $529,005 $528,444
Total Deposits $404,291 $403,496
Non-Interest Checking 60,281 59,487
Interest Checking & NOW 76,150 65,530
Regular Savings 23,153 18,338
Money Market Savings 59,750 69,078
CDs Less than $100,000 107,556 103,687
CDs Greater than $100,000 66,195 77,033
Other Time 11,206 10,343
Total Borrowings 75,562 76,853
Federal Funds Purchased 200 -
Securities Sold Under Repurchase
Agreements 39,274 39,903
FHLB Advances 34,999 35,540
Loans Sold Under Repurchase
Agreement and
Other Notes Payable 1,089 1,410
Interest Payable and Other
Liabilities 5,646 5,639
Total Liabilities 485,499 485,988
Shareholders Equity 43,506 42,456
Total Liabilities and
Shareholders' Equity $529,005 $528,444
Book Value Per Share $7.13 $6.96
End of Period Shares Outstanding 6,102,529 6,101,055
* period end numbers
Monroe Bancorp (MROE)
Financial Summary
(dollar amounts in thousands except per share data)
Years Ending
Dec 2002 Dec 2001
BALANCE SHEET *
Cash and Due from Banks $20,526 $17,276
Federal Funds Sold - -
Securities 103,779 88,450
Total Loans 391,315 371,800
Loans Held for Sale 7,417 8,032
Commercial & Industrial 78,061 73,724
Real Estate:
Commercial & Residential 238,013 225,931
Construction & Vacant Land 27,470 28,013
Home Equity 17,927 13,637
Installment Loans 22,426 22,463
Reserve for Loan Losses 4,574 4,198
Bank Premises and Equipment 11,793 11,633
Federal Home Loan Bank Stock 1,882 1,534
Interest Receivable and Other Assets 8,596 9,058
Total Assets $533,317 $495,553
Total Deposits $398,567 $359,206
Non-Interest Checking 60,476 55,034
Interest Checking & NOW 81,160 65,925
Regular Savings 22,459 16,840
Money Market Savings 53,865 64,802
CDs Less than $100,000 99,930 87,137
CDs Greater than $100,000 69,910 60,180
Other Time 10,767 9,288
Total Borrowings 85,240 89,997
Federal Funds Purchased 10,050 21,900
Securities Sold Under Repurchase
Agreements 39,158 36,312
FHLB Advances 34,956 30,658
Loans Sold Under Repurchase
Agreement and
Other Notes Payable 1,076 1,127
Interest Payable and Other
Liabilities 5,247 5,666
Total Liabilities 489,054 454,869
Shareholders Equity 44,263 40,684
Total Liabilities and
Shareholders' Equity $533,317 $495,553
Book Value Per Share $7.25 $6.67
End of Period Shares Outstanding 6,103,869 6,098,503
* period end numbers
Monroe Bancorp (MROE)
Financial Summary
(dollar amounts in thousands except per share data)
Quarters Ending
INCOME STATEMENT June 2003 Mar 2003 Dec 2002
Net Interest Income $4,759 $4,720 $4,748
Loan Loss Provision 2,705 405 805
Total Non-Interest Income 2,317 1,684 1,832
Service Charges on Deposit
Accounts 700 634 659
Trust Fees 230 273 208
Commission Income 277 186 210
Gain on Sale of Loans 462 364 404
Realized Gains (Losses) on
Securities 171 (5) 6
Unrealized Gains (Losses) on
Trading Securities
Associated with Directors'
Deferred Comp Plan 217 (25) 83
Other Operating Income 260 257 262
Total Non-Interest Expense 4,322 3,705 3,727
Salaries & Wages 1,528 1,527 1,509
Commissions & Incentive
Compensation 494 350 283
Employee Benefits 429 373 369
Premises & Equipment 567 638 592
Advertising 162 127 108
Legal Fees 147 101 54
Appreciation (Depreciation) in
Directors'
Deferred Compensation Plan 238 (19) 117
Other Operating Expenses 757 608 695
Income Before Income Tax 49 2,294 2,048
Income Tax Expense (Benefit) (213) 746 669
Net Income After Tax & Before
Extraordinary Items 262 1,548 1,379
Extraordinary Items - - -
Net Income $262 $1,548 $1,379
Basic Earnings Per Share $0.04 $0.25 $0.23
Diluted Earnings Per Share 0.04 0.25 0.23
Monroe Bancorp (MROE)
Financial Summary
(dollar amounts in thousands except per share data)
INCOME STATEMENT Sept 2002 June 2002
Net Interest Income $4,716 $4,647
Loan Loss Provision 405 276
Total Non-Interest Income 1,494 1,329
Service Charges on Deposit
Accounts 671 662
Trust Fees 254 239
Commission Income 196 203
Gain on Sale of Loans 239 174
Realized Gains (Losses) on
Securities 151 46
Unrealized Gains (Losses) on
Trading Securities
Associated with Directors'
Deferred Comp Plan (239) (192)
Other Operating Income 222 197
Total Non-Interest Expense 3,330 3,364
Salaries & Wages 1,520 1,522
Commissions & Incentive
Compensation 358 293
Employee Benefits 287 286
Premises & Equipment 595 600
Advertising 127 181
Legal Fees 19 33
Appreciation (Depreciation) in
Directors'
Deferred Compensation Plan (229) (178)
Other Operating Expenses 653 627
Income Before Income Tax 2,475 2,336
Income Tax Expense (Benefit) 818 773
Net Income After Tax & Before
Extraordinary Items 1,657 1,563
Extraordinary Items - -
Net Income $1,657 $1,563
Basic Earnings Per Share $0.27 $0.26
Diluted Earnings Per Share 0.27 0.26
Monroe Bancorp (MROE)
Financial Summary
(dollar amounts in thousands except per share data)
Years Ended
INCOME STATEMENT Dec 2002 Dec 2001
Net Interest Income $18,738 $16,937
Loan Loss Provision 1,762 1,050
Total Non-Interest Income 6,070 4,916
Service Charges on Deposit
Accounts 2,587 2,128
Trust Fees 918 839
Commission Income 817 770
Gain on Sale of Loans 1,036 515
Realized Gains (Losses) on
Securities 203 (6)
Unrealized Gains (Losses) on
Trading Securities
Associated with Directors'
Deferred Comp Plan (361) (224)
Other Operating Income 870 894
Total Non-Interest Expense 13,931 12,046
Salaries & Wages 5,995 5,319
Commissions & Incentive
Compensation 1,230 886
Employee Benefits 1,317 1,158
Premises & Equipment 2,382 1,968
Advertising 584 552
Legal Fees 143 131
Appreciation (Depreciation) in
Directors'
Deferred Compensation Plan (290) (158)
Other Operating Expenses 2,570 2,190
Income Before Income Tax 9,115 8,757
Income Tax Expense (Benefit) 3,017 3,008
Net Income After Tax & Before
Extraordinary Items 6,098 5,749
Extraordinary Items - -
Net Income $6,098 $5,749
Basic Earnings Per Share $1.00 $0.94
Diluted Earnings Per Share 1.00 0.94
Monroe Bancorp (MROE)
Financial Summary
(dollar amounts in thousands except
per share data)
Quarters Ending
ASSET QUALITY June 2003 Mar 2003 Dec 2002
Net Charge-Offs $1,534 $299 $162
OREO Expenses (Gains) 43 10 21
Total Credit Charges $1,577 $309 $183
Non-Performing Loans $7,999 $8,047 $4,057
OREO 245 258 110
Non-Performing Assets $8,244 8,305 4,167
90 Day Past Due Loans net of NPLs 407 1,889 588
Non Performing Assets+
90PD/Assets $8,651 $10,194 $4,755
RATIO ANALYSIS - CREDIT QUALITY*
NCO/Loans 1.48% 0.30% 0.17%
Credit Charges/Loans & OREO 1.52% 0.31% 0.19%
Non-Performing Loans/Loans 1.93% 2.00% 1.04%
Non Performing Assets/Loans &OREO 1.99% 2.07% 1.06%
Non-Performing Assets/Assets 1.44% 1.50% 0.78%
Non Performing Assets+ 90PD/Assets 1.51% 1.84% 0.89%
Reserve/Non Performing Loans 73.48% 58.16% 112.74%
Reserve/Total Loans 1.42% 1.16% 1.17%
Equity & Reserves/NPA 614.22% 598.00% 1171.99%
OREO/NPA 2.97% 3.11% 2.64%
RATIO ANALYSIS - CAPITAL ADEQUACY *
Equity/Assets 7.80% 8.13% 8.30%
Equity/Loans 10.81% 11.19% 11.31%
RATIO ANALYSIS - PROFITABILITY
Return on Average Assets 0.19% 1.15% 1.03%
Return on Average Equity 2.34% 14.00% 12.45%
Net Interest Margin (tax-equivalent) 3.76% 3.92% 3.95%
* Based on period end numbers
Monroe Bancorp (MROE)
Financial Summary
(dollar amounts in thousands except
per share data)
ASSET QUALITY Sept 2002 June 2002
Net Charge-Offs $660 $340
OREO Expenses (Gains) 17 52
Total Credit Charges $677 $392
Non-Performing Loans $2,441 $2,834
OREO 377 280
Non-Performing Assets 2,818 3,114
90 Day Past Due Loans net of NPLs 883 1,182
Non Performing Assets+
90PD/Assets $3,701 $4,296
RATIO ANALYSIS - CREDIT QUALITY*
NCO/Loans 0.68% 0.36%
Credit Charges/Loans & OREO 0.69% 0.41%
Non-Performing Loans/Loans 0.63% 0.74%
Non Performing Assets/Loans &OREO 0.72% 0.82%
Non-Performing Assets/Assets 0.53% 0.59%
Non Performing Assets+ 90PD/Assets 0.70% 0.81%
Reserve/Non Performing Loans 161.04% 147.71%
Reserve/Total Loans 1.01% 1.10%
Equity & Reserves/NPA 1683.36% 1497.82%
OREO/NPA 13.38% 8.99%
RATIO ANALYSIS - CAPITAL ADEQUACY *
Equity/Assets 8.22% 8.03%
Equity/Loans 11.14% 11.14%
RATIO ANALYSIS - PROFITABILITY
Return on Average Assets 1.24% 1.21%
Return on Average Equity 15.25% 14.91%
Net Interest Margin (tax-equivalent) 3.94% 4.05%
* Based on period end numbers
Monroe Bancorp (MROE)
Financial Summary
(dollar amounts in thousands except
per share data)
Years Ending
ASSET QUALITY Dec 2002 Dec 2001
Net Charge-Offs $1,358 $724
OREO Expenses (Gains) 101 80
Total Credit Charges $1,459 $759
Non-Performing Loans $4,057 $1,474
OREO 110 505
Non-Performing Assets 4,167 1,979
90 Day Past Due Loans net of NPLs 588 1,705
Non Performing Assets+
90PD/Assets $4,755 $3,684
RATIO ANALYSIS - CREDIT QUALITY*
NCO/Loans 0.35% 0.19%
Credit Charges/Loans & OREO 0.37% 0.20%
Non-Performing Loans/Loans 1.04% 0.40%
Non Performing Assets/Loans &OREO 1.06% 0.53%
Non-Performing Assets/Assets 0.78% 0.40%
Non Performing Assets+ 90PD/Assets 0.89% 0.74%
Reserve/Non Performing Loans 112.74% 284.80%
Reserve/Total Loans 1.17% 1.13%
Equity & Reserves/NPA 1171.99% 2267.91%
OREO/NPA 2.64% 25.52%
RATIO ANALYSIS - CAPITAL ADEQUACY *
Equity/Assets 8.30% 8.21%
Equity/Loans 11.31% 10.94%
RATIO ANALYSIS - PROFITABILITY
Return on Average Assets 1.17% 1.26%
Return on Average Equity 14.32% 14.52%
Net Interest Margin (tax-equivalent) 4.02% 4.17%
* Based on period end numbers
