Corporate Profile HOWARD BANCORP, INC. (NASDAQ - HBMD)
Market Value ($M)
$ (0.49) (4.16) %
As of March 7, 2014 Minimum 20 minute delay.
Howard Bancorp, Inc. is the holding company for Howard Bank, a community bank serving the Greater Baltimore and Central Maryland Region.
Howard Bancorp, Inc.’s Common Stock is listed on NASDAQ under the symbol HBMD
Howard Bancorp, Inc.,the parent company of Howard Bank, announced on January 16, 2014 its operating results through December 31, 2013 with the following highlights:
• Recorded asset growth of $98.2 million or 24.5% to end 2013 just shy of half a billion dollars in asset size. Total assets increased from $401.7 million at the end of 2012 to $499.9 million at December 31, 2013.
• Earnings per share (EPS) for the year increased by 43%, from $0.31 for the twelve months ended December 31, 2012 to $0.44 for the 2013 fiscal year. For the fourth quarter of 2013, earnings per share were $0.13, which represents an increase of nearly 76% over EPS of $.07 for the fourth quarter of 2012.
• The Company completed its first acquisition with the purchase from Cecil Bank of its branch located at 3 West Bel Air Avenue, Aberdeen, Maryland. Pursuant to the branch purchase, Howard Bank acquired $37.1 million in loans and $35.2 million in deposits during the third quarter of 2013.
• We opened our seventh full service branch location in Towson, Maryland along with a regional office to better serve the Greater Baltimore marketplace.
• Executed a lease for another branch office to be located in Bel Air, Maryland, and we anticipate an opening in the first quarter of 2014.
• Launched a new mortgage banking division with offices in Timonium, Ellicott City and Annapolis, Maryland, to focus on purchase money originations.
For the year ended December 31, 2013, the Company reported net income of $1.96 million compared to net income of $1.62 million in 2012, an increase of $341 thousand or 21%. Net interest income was $15.8 million for 2013 which represented an increase of $2.3 million or 17% compared to 2012, and was driven by our continued balance sheet growth. Partially offsetting the increase in net interest income, the provision for loan losses in 2013 of $950 thousand was $232 thousand or 32% higher than the 2012 provision of $718 thousand. Noninterest income also increased, to $1.3 million during 2013 compared to $768 thousand for 2012, representing an increase of $557 thousand or 73%. A large contributor to the increased noninterest revenues was the initiation of a Bank Owned Life Insurance (BOLI) program in January 2013, which generated $282 thousand of income during 2013. In addition to the BOLI income, year over year service charges on deposits and mortgage banking gains increased by 20% and 76%, respectively, during 2013. Total noninterest expenses for 2013 of $13.2 million increased by $2.4 million or 22% over total noninterest expenses of $10.8 million in 2012. Compensation expenses, which accounted for more than half of the total increase in expenses, grew by $1.3 million or 22% for 2013 compared to 2012 due to increases in staffing as we continue to open new branch and regional office locations, and also commenced the building and staffing of our new mortgage division. With our geographic expansion, we also increased our advertising and business development expenditures to support our entrée into the new markets and saw increased professional fees associated with the successful initiative to supplement organic growth with acquired growth. Also in 2013, the Company recorded $347 thousand in expense due to decreasing valuations on properties held, while this same expense for 2012 was only $48 thousand, representing a year over year increase of $299 thousand, as work towards disposal of the residual nonperforming assets on the balance sheet continues.
Even though asset quality has been steadily improving for Howard Bank, it continued to be a major focus of attention for management and the board of directors throughout 2013. One of the Bank’s primary measures of asset quality is the ratio of non-accrual loans and OREO as a percentage of total assets. This asset quality measure showed improvement for 2013 with a ratio of 1.11% at December 31, 2013 versus 1.32% at the end of 2012.
As mentioned above, 2013 represented a year of continued balance sheet growth with December 31, 2013 total assets of $500 million, total loans of $404 million, and total deposits of $389 million, representing growth of 24%, 25%, and 24%, respectively, over the 2012 year end balances. Even without the $37.1 million in loans and $35.2 million in deposits acquired in 2013, continued organic growth resulted in growth in assets, loans and deposits of 14%, 15%, and 12%, respectively.
At December 31, 2013 Howard Bancorp, Inc. had total capital of $48.6 million, representing an increase of $1.9 million or 4% over total capital of $46.7 million at December 31, 2012. The capital growth represents retention of the previous four quarters of earnings. Howard Bank continues to be well in excess of the required capital levels to be considered well-capitalized under all regulatory capital guidelines.
For the fourth quarter of 2013, Howard Bancorp recorded EPS of $0.13 compared to EPS of $0.07 for the fourth quarter of 2012, representing an increase of 76%. Fourth quarter 2013 net income of $556 thousand compares to net income of $439 thousand for the fourth quarter of 2012, representing an increase of 27%. Driving this quarter over quarter increase in net income was net interest income growth of 23% and noninterest income growth of 66%, while total expenses increased by 25% with the continued expansion.
Chairman and CEO Mary Ann Scully stated: “We are pleased to report another year and another fourth quarter of increased earnings. This consistent earnings improvement reflects the success of the forward investment strategy deployed by Howard Bancorp since our inception in 2004. The Company continued to make those investments in 2013, in all three areas of our focus: geographic expansion in attractive contiguous markets; organic growth to be supplemented by prudent acquired growth; and diversification of revenue streams to include more substantive levels of noninterest income not dependent on the balance sheet to complement our historical success in growing net interest income. Howard Bancorp now operates in four attractive Greater Baltimore counties with both a commercial banking operation focused especially on growing small and medium sized businesses, their owners and professionals and a mortgage banking operation focused on helping members of those communities make their most significant personal investments. We expect that the significant investments already made and those which will continue to be made in both of those business lines, although dilutive in the early stages, should reap increasing rewards as 2014 progresses. Our belief that our stockholders’ long term interest are best served by a community focused bank making a difference in the lives of those communities by offering an unparalleled level of experience and expertise combined with an unparalleled commitment to communities, is being validated with earnings growth. We are grateful to our colleagues who provide that level of expertise and commitment and to our customers for trusting in us and look forward to a robust 2014 where we believe the opportunities continue to be significant."
The press release, in its entirety, is available under the "Press Release" tab on the left.