Virginia Commerce Bancorp, Inc. (the “Company”), (Nasdaq: VCBI),
parent company of Virginia Commerce Bank (the “Bank”), today
reported its financial results for the fourth quarter and year
ended December 31, 2012.
Fourth Quarter 2012
Highlights
- Repurchased all Preferred Stock
Issued Under TARP Capital Purchase Program: The Company
repurchased its entire $71.0 million of Preferred Stock issued
under the TARP Capital Purchase Program.
- Net Income Available to Common
Stockholders and Earnings per Diluted Common Share: Net income
available to common stockholders of $4.2 million, or $0.12 per
diluted share, for the fourth quarter of 2012, including a one-time
charge of $2.1 million relating to the acceleration of the
accretion of the TARP preferred stock discount. This compares to
net income available to common stockholders of $5.4 million and
$7.1 million for the fourth quarter of 2011, and the third quarter
of 2012, respectively.
- Adjusted Operating Earnings (a
non-GAAP measure): Adjusted operating earnings for the fourth
quarter of 2012 of $5.3 million, or $0.16 per diluted common share.
This compares to $0.17 per diluted common share for both the fourth
quarter of 2011, and the third quarter of 2012.
- Quarterly Return on Average Assets
(ROAA) of 1.03% and Return on Average Equity (ROAE) of
10.20%
- Net Interest Margin Growth: The
net interest margin increased to 3.73% for the fourth quarter of
2012, compared to 3.62% in the third quarter of 2012.
- Loan and Deposit Growth: Total
loans grew $42.4 million during the fourth quarter of 2012,
representing an annualized growth rate of 7.9%. Demand, savings and
interest-bearing demand deposits, grew $51.0 million during the
fourth of 2012, representing an annualized growth rate of 13.0%. As
of December 31, 2012, non-interest bearing demand deposits
represented 18.5% of total deposits.
- Asset Quality Improved:
Non-performing assets and loans 90+ days past due to total assets
sequentially decreased $9.3 million, from 1.98% at September 30,
2012, to 1.78% at December 31, 2012. Net charge-offs for the fourth
quarter of 2012 were $1.1 million, or 5 basis points of average
loans outstanding, as compared to $4.3 million, or 20 basis points
for the same quarter last year, and $8.5 million, or 39 basis
points, for the prior quarter.
- Capital Strength and Book Value per
Common Share Growth: Tier 1, total qualifying and tier 1
leverage capital ratios were 13.25%, 14.51% and 10.29%, at December
31, 2012, respectively. Tangible common equity improved to 8.69% at
December 31, 2012, as compared to 8.08% at September 30, 2012. The
book value per common share increased to $7.68 at December 31,
2012, as compared to $7.63 at September 30, 2012.
Year 2012 Highlights
- Net Income Available to Common
Stockholders: Net income available to common stockholders
increased to $22.5 million for 2012. This represented an
approximately $700 thousand, or 3.2% increase, compared to $21.8
million for 2011. Net income available to common stockholders
includes a reduction for an effective dividend on preferred stock
of $7.6 million and $5.3 million, for 2012 and 2011, respectively.
The effective dividend on preferred stock will not continue into
2013, as the Company repurchased all of its TARP preferred stock
during the fourth quarter of 2012.
- Return on Average Assets (ROAA) of
1.01% and Return on Average Equity (ROAE) of 10.11%
- Loan and Deposit Growth: Total
loans grew $22.6 million to $2.1 billion at December 31, 2012.
Demand, savings and interest-bearing demand deposits, grew $105.0
million to $1.6 billion at December 31, 2012.
- Capital Strength and Book Value per
Common Share Growth: Tangible common equity improved to 8.69%
at December 31, 2012, from 7.37% at December 31, 2011. The book
value per common share increased to $7.68 at December 31, 2012, as
compared to $7.17 at December 31, 2011.
Peter A. Converse, President and Chief Executive Officer,
commented, “It was most gratifying for the Company to end the year
with a strong fourth quarter performance that was capped by our
full repayment of TARP. Net income was $7.8 million for the fourth
quarter of 2012, up 15.3% over the year ago quarter. Return on
average assets and return on average equity were 1.03% and 10.20%,
respectively. The net interest margin rebounded nicely from the
prior quarter, rising 11 basis points to 3.73%. Loan and deposit
growth resumed in the fourth quarter with total loans increasing on
a linked quarter basis at an annualized rate of 7.9%, while total
deposits grew at an annualized rate of 5.9%. Asset quality
experienced notable improvement in the fourth quarter with
non-performing assets and loans 90+ days past due to total assets
sequentially declining by $9.3 million, the largest quarterly
decrease in over a year. Loans 30-89 days past due of $6.1 million
as of December 31, 2012, were at their lowest level in three years.
Fourth quarter net charge-offs of $1.1 million were down
considerably from $8.5 million for the prior quarter and from $4.3
million for the year ago quarter. In fact, quarterly net
charge-offs have not been that low since the first quarter of
2008.
Converse continued, “The repayment of TARP in December without
an additional capital raise was clearly the highlight for both the
fourth quarter and the year. Overcoming the adversity and
challenges of the past four years to achieve this result was truly
a team effort of which we’re all quite proud. And despite the
reduction in Tier 1 capital that resulted from the TARP repayment,
all of our regulatory capital ratios remain significantly in excess
of well-capitalized levels. Furthermore, tangible common equity
improved to 8.69% at December 31, 2012, as compared to 8.08% at
September 30, 2012.”
Converse concluded, “On Monday of this week before the market
opened, we announced that our Board has initiated a formal review
through Sandler O’Neill + Partners, L.P. of strategic alternatives
to enhance stockholder value, including a possible merger, sale or
other form of business combination. While such strategic
explorations by any publically-traded company or bank are intended
to remain confidential, this announcement was made necessary due to
an article that was released by Bloomberg late in the day on the
prior Friday. I will repeat again what was said in our Monday
release:
The Company has not set a definite timetable
for completion of its evaluation and there can be no assurance that
this process will lead to the pursuit, approval or completion of
any transaction or other strategic initiative. The Company does not
intend to disclose developments regarding this process unless and
until its Board of Directors approves a specific transaction or
otherwise concludes its review of strategic alternatives.
For those who question the timing of our strategic
considerations, I will say that the challenges of the current
economic, market and regulatory environment in which community
banks operate, as well as unique opportunities which may come up
from time to time, make it incumbent upon bank directors to
periodically consider strategic options beyond staying the
course.”
SUMMARY REVIEW OF FINANCIAL PERFORMANCE
Net Income
For the three months ended December 31, 2012, the Company
recorded net income of $7.8 million. After an effective dividend of
$3.5 million to the U.S. Treasury on TARP preferred stock, which
includes a one-time charge of $2.1 million relating to the
acceleration of the accretion of the preferred stock discount in
connection with the repurchase of all of the Company’s TARP
preferred stock, the Company reported net income available to
common stockholders of $4.2 million, or $0.12 per diluted common
share. Comparatively, net income available to common stockholders
for the fourth quarter of 2011 was $5.4 million, or $0.17 per
diluted common share. Sequentially, net income available to common
shareholders decreased $2.9 million, or $0.09 per diluted common
share, from the third quarter in 2012, primarily due to the $2.1
million accelerated accretion of the preferred stock discount
during the fourth quarter of 2012. Also, contributing to the
sequential decrease in net income was an increase in non-interest
expenses of $1.6 million, partially offset by a reduction in the
provision for loan losses of $552 thousand. For the twelve months
ended December 31, 2012, the Company reported net income available
to common stockholders of $22.5 million, or $0.67 per diluted
common share, compared to net income available to common
stockholders of $21.8 million, or $0.71 per diluted common share,
for the same period in 2011. The primary factors driving the
year-over-year increase are a $9.3 million increase in non-interest
income offset by an increase in non-interest expense of $4.5
million and a $2.3 million increase in the effective dividend on
TARP preferred stock.
Adjusted operating earnings (a non-GAAP measure) for the three
months ended December 31, 2012, were $5.3 million, or $0.16 per
diluted common share, compared to $5.4 million, or $0.17 per
diluted common share, for the same period in 2011. On a sequential
basis, adjusted operating earnings decreased $440 thousand, or
$0.01 per diluted common share, for the three months ended December
31, 2012. The sequential decrease was primarily related to an
increase in non-interest expense of $1.6 million, partially offset
by a reduction in the provision for loan losses of $552 thousand,
and a $701 thousand tax effect adjustment. The Company calculates
adjusted operating earnings by excluding impairment loss on
securities, realized gains and losses on sale of securities, death
benefits received from bank-owned life insurance, and certain other
non-recurring items from net income available to common
stockholders.
Asset Quality and Provisions For Loan Losses
Total non-performing assets and loans 90+ days past due declined
$9.3 million sequentially from $59.5 million at September 30, 2012,
to $50.2 million at December 31, 2012, and increased from $47.8
million at December 31, 2011. As a percentage of total assets,
non-performing assets decreased from 1.98% at September 30, 2012,
to 1.78% at December 31, 2012, while increasing from 1.63% at
December 31, 2011. As of December 31, 2012, the allowance for loan
losses represented 1.95% of total loans, compared to 1.92% and
2.24%, at September 30, 2012, and December 31, 2011, respectively.
The allowance for loan losses covered 112.8% of total
non-performing loans as of December 31, 2012, compared to 90.8% and
125.4%, at September 30, 2012, and December 31, 2011,
respectively.
Non-performing loans continue to be concentrated in residential
and commercial construction and land development loans in outer
sub-markets hardest hit by the residential downturn and commercial
and consumer credits experiencing the after shocks in
sub-contracting businesses and unemployment levels. Overall, as of
December 31, 2012, $22.8 million, or 60.2%, of non-performing loans
represented acquisition, development and construction (“ADC”)
loans, $5.7 million, or 14.9%, represented non-farm,
non-residential loans, $6.1 million, or 16.1%, represented loans on
one-to-four family residential properties, and $3.3 million, or
8.7%, represented commercial and industrial (“C&I”) loans. As
of December 31, 2012, specific reserves of $16.4 million have been
established for non-performing loans and other loans determined to
be impaired. The Company continues to pursue an aggressive campaign
to reduce non-performing and other impaired loans and is
implementing and executing various disposition strategies on an
ongoing basis. However, the majority of remaining non-performing
loans represent situations which require longer term workout
strategies to obtain optimal principal recovery. These strategies
are dependent upon project completion, permitting, satisfaction of
contract contingencies and other factors.
Included in the loan portfolio at December 31, 2012, are loans
classified as troubled debt restructurings (“TDRs”), totaling $43.5
million, a 16.9% decrease from $52.3 million at December 31, 2011.
Sequentially, TDRs decreased $1.4 million from $44.9 million at
September 30, 2012. TDRs are performing, accruing loans that
represent relationships for which a modification to the contractual
interest rate or repayment structure has been granted to address a
financial hardship. Over 91% of TDRs in the Company’s loan
portfolio at December 31, 2012, were performing prior to
modification. TDRs make up 2.0% of the total loan portfolio and
represent $7.0 million in ADC loans, $25.3 million in non-farm,
non-residential real estate loans, $6.9 million in C&I loans
and $4.3 million in one-to-four family residential loans. At
December 31, 2012, 45.7% of the Company’s TDRs were reviewable TDRs
and 54.3% were permanent TDRs. Reviewable TDRs are loans that have
been restructured at or will return to a market rate of interest
and can include a temporary interest rate modification, partial
deferral of interest or principal or an extension of term. They can
return to performing status upon six months of on-time payments
following the return to a market rate of interest, but only in the
fiscal year following the year of restructure. Permanent TDRs are
loans that have been restructured and include a permanent interest
rate reduction. They remain in a TDR status until the loan is paid
off.
Classified loans were $160.6 million for the quarter ended
December 31, 2012, a $30.3 million decrease from $190.9 million at
December 31, 2011. Sequentially, classified loans declined $21.9
million from $182.5 million at September 30, 2012. The quarterly
decline in classified loans was largely due to upgrades to loans to
a paving contractor, residential real estate developer and
commercial real estate owner in the combined total of $9.1 million,
loan payoffs resulting from residential real estate sales of $6.8
million, and loans refinanced by other banks of $1.7 million,
partially offset by a $3.9 million downgrade for loans to a
utilities and public improvements contractor.
Provisions for loan losses were $2.6 million for the quarter
ended December 31, 2012, compared to $3.6 million in the same
period in 2011, and $3.1 million in the third quarter of 2012. Net
charge-offs were $1.1 million for the three months ended December
31, 2012, compared to $8.5 million and $4.3 million for the
quarters ended September 30, 2012, and December 31, 2011,
respectively. For the twelve months ended December 31, 2012,
provisions for loan losses totaled $14.8 million. Net charge-offs
for the year ending December 31, 2012, amounted to $20.8 million,
compared to $28.6 million in the year ended December 31, 2011. The
decreases in the allowance for loan losses as a percentage of total
loans and in the coverage of non-performing loans from December 31,
2011, to December 31, 2012, is due to charge-offs incurred during
2012 being primarily supported by specific reserves in the
allowance for loan losses. As a result, the fourth quarter analysis
of the adequacy of the loan loss reserve indicated that loan loss
provisioning of $2.6 million was sufficient to maintain appropriate
coverage. The $7.8 million reduction in net charge-offs for the
year ended December 31, 2012, compared to the same period in 2011,
was primarily due to net charge-offs in the ADC loan portfolio
decreasing $7.6 million, from $14.6 million in 2011 to $7.0 million
in 2012, and charge-offs in the non-farm, non-residential portfolio
decreasing $3.5 million from $8.8 million in 2011 to $5.3 million
in 2012, partially offset by an increase of $3.3 million in net
charge-offs in the C&I loan portfolio, from $1.7 million in
2011 to $4.9 million in 2012.
Net Interest Income and Net Interest Margin
Net interest income of $26.6 million for the fourth quarter of
2012 declined $499 thousand, or 1.8%, over the same quarter last
year. The net interest margin decreased 5 basis points from 3.78%
in the fourth quarter of 2011, to 3.73% for the same period in
2012. Net interest income for the year ended December 31, 2012, of
$106.7 million was mostly unchanged, compared to net interest
income of $106.8 million for the year ended December 31, 2011. On a
sequential basis, the net interest margin was up 11 basis points
from 3.62% for the third quarter of 2012, to 3.73% for the fourth
quarter of 2012. The year-over-year decrease in the fourth quarter
net interest margin was due to the prolonged low interest rate
environment contributing to lower rates on loan and investment
security assets, the impact of which was partially offset by lower
costs on average interest-bearing deposits and securities sold
under agreement to purchase. The sequential increase in the net
interest margin was primarily driven by a decrease of 7 basis
points in the total deposit yield and a reduction of $37.3 million,
or 18.6%, in average low yielding, interest-bearing deposits in
other banks, partially offset by a 3 basis point decrease in loan
yield. The sequential reduction in liquidity is expected to
continue into 2013, as interest bearing deposits in other banks
decreased from $214.0 million as of September 30, 2012, to $1.0
million as of December 31, 2012. The decrease in liquidity that
occurred late in the fourth quarter of 2012, was driven by the
intentional run-off of certain interest-bearing liabilities and is
expected to have a positive impact on the net interest margin for
the first quarter of 2013. Interest and dividend income decreased
$2.9 million on average total interest-earnings assets of $2.9
billion for the three months ended December 31, 2012, compared to
interest and dividend income generated by average total
interest-earnings assets of $2.8 billion for the same period in
2011. The decline in interest and dividend income is mostly
attributable to lower yielding average loan and security assets
being generated in the current low interest rate environment.
Interest expense decreased $2.4 million to $5.8 million generated
on an average total interest-bearing liability balance of $2.3
billion for the quarter ended December 31, 2012, from $8.2 million
generated on an average total interest-bearing liability balance of
$2.3 billion for the same period in 2011. The average rate paid on
total interest-bearing liabilities was 1.02% for the fourth quarter
of 2012, as compared to 1.12% for the third quarter 2012, and 1.40%
for the fourth quarter of 2011. Management anticipates the net
interest margin will range between 3.70% and 3.80% for the first
quarter of 2013.
Non-Interest Income
For the three months ended December 31, 2012, the Company
recognized $4.4 million in non-interest income, compared to
non-interest income of $2.5 million for the three months ended
December 31, 2011, and $4.7 million for the sequential quarter.
Included in the fourth quarter 2012 non-interest income is a gain
on sale of securities of $1.5 million, while the fourth quarter of
2011 did not include a gain or loss on sale of securities, and the
sequential quarter included a gain of $2.1 million on sale of
securities. The Company recognized non-interest income of $17.5
million for the year ended December 31, 2012, compared to
non-interest income of $8.1 million for the same period in 2011.
For 2012, non-interest income included a gain on sale of securities
of $7.4 million, while non-interest income for the same period in
2011 included an impairment loss on securities of $732 thousand,
which was partially offset by a gain on sale of securities of $503
thousand and a bank-owned life insurance death benefit of $361
thousand.
Fees and net gains on loans held-for-sale in the fourth quarter
of 2012, increased sequentially by $449 thousand, or 40.0%. The
increase can be primarily attributed to higher volume of mortgage
loans originated for sale in the secondary market, which was driven
by lower interest rates on mortgage products during 2012. For 2012,
fees and net gains on loans held-for-sale increased $1.6 million,
or 53.5%, compared to the same period in 2011. Mortgage loans
held-for sale totaling $210.1 million were closed in the year ended
2012, as compared to $155.2 million to the same period for
2011.
Non-Interest Expense
Non-interest expense increased approximately $991 thousand, or
6.3%, from $15.9 million in the fourth quarter of 2011, to $16.8
million in the fourth quarter of 2012. Sequentially, non-interest
expense increased $1.6 million, or 10.7%, from $15.2 million for
the third quarter of 2012. The majority of the year-over-year
increase was an increase of $1.5 million on other real estate owned
losses and expenses, and $157 thousand increase in franchise tax
expense, partially offset by reductions of $344 thousand and $268
thousand in FDIC insurance and other operating expenses,
respectively. The sequential increase in non-interest expense was
primarily driven by an increase of $1.5 million on other real
estate owned losses and expenses.
Investment Securities
Investment securities decreased $131.5 million, or 21.0%,
year-over-year to $493.4 million at December 31, 2012, and were
down $51.7 million sequentially from September 30, 2012. During the
fourth quarter of 2012, the Company sold $24.9 million of
investment securities resulting in a $1.5 million realized gain on
sale of securities. The investment portfolio contains two pooled
trust preferred securities with a book value of $5.1 million, and a
market value of $357 thousand at December 31, 2012, for which the
Company performs a quarterly analysis to determine whether any
other than temporary impairment exists. The analysis includes
stress tests on the underlying collateral and cash flow estimates
based on the current and projected future levels of deferrals,
defaults, and prepayments within each pool. There has been no
recorded impairment loss for the year ended December 31, 2012,
compared to an impairment loss of $732 thousand for the same time
period in 2011.
Loans
Loans, net of allowance for loan losses, increased $22.6
million, or 1.1%. Non-farm, non-residential real estate loans
increased $22.3 million, or 2.0%, one-to-four family residential
increased $26.9 million or 7.2%, multifamily real estate loans
increased $1.9 million, or 2.5%, C&I loans were up $8.6
million, or 3.4%, and ADC loans fell by $44.4 million, or 13.6%,
from December 31, 2011, to December 31, 2012. Sequentially, loans,
net of allowance for loan losses, increased $40.3 million, or 1.9%.
The sequential increase in loans was primarily attributable to a
$31.1 million increase in C&I loans, a $21.1 million increase
in ADC loans and a $19.2 million increase in owner-occupied
non-farm, non-residential loans partially offset by a $22.7 million
decline in non-owner-occupied non-farm, non-residential loans and
an $8.4 million decrease in multi-family residential loans. The
sequential increase in C&I loans was driven by a combination of
new term funding for several significant business expansion
transactions, increased credit line usage partly attributable to
year-end tax planning and borrowings in anticipation of changes in
the tax code. The rise in ADC loans represented increased funding
of new and ongoing construction projects, primarily consisting of
single family and multi-family residential properties. The
sequential increase in owner-occupied non-farm, non-residential
loans represented the refinance of several new business and
non-profit clients’ operating facilities. The sequential decreases
in non-owner-occupied non-farm, non-residential loans and
multi-family loans primarily represented early payoffs, scheduled
principal amortization and maturities in excess of new loan
generation. The orientation of loan generation efforts and loan mix
continues to be reflective of the Bank’s strategic emphasis on
building greater market share in commercial lending, owner-occupied
commercial real estate and residential real estate lending, while
focusing ADC lending and non-owner-occupied commercial real estate
lending on select transactions in key markets with solid economic
metrics.
Deposits
Total deposits at December 31, 2012, were $2.2 billion, a
decrease of $46.8 million, or 2.0%, compared to December 31, 2011,
with demand deposits increasing $78.2 million, or 23.1%, savings
and interest-bearing demand deposits increasing $26.8 million, or
2.3%, and time deposits decreasing $151.7 million, or 19.4%. As of
December 31, 2012, non-interest bearing demand deposits represented
18.5% of total deposits. Demand, savings and interest-bearing
demand deposits, grew year-over-year by $105.0 million to $1.6
billion at December 31, 2012. Over the past twelve months,
generation of demand deposits was driven primarily by the
successful efforts of the Company’s team of eight business
development officers, who are focused on acquisition and retention
of commercial operating funds, treasury management services, and
other related cross-sales. On a linked quarter basis, deposits
increased $32.8 million, or 1.5%, with demand deposits increasing
by $25.4 million, or 6.5%, savings and interest-bearing demand
accounts increasing $25.6 million, or 2.2%, and time deposits
decreasing by $18.2 million, or 2.8%. Demand, savings and
interest-bearing demand deposits, grew $51.0 million during the
fourth quarter of 2012, representing an annualized growth rate of
13.0%. The reduction in time deposits during the part year has been
intentional and resulted from a series of interest rate reductions
that continued throughout 2012. As a result of deposit rate
decreases and an improving deposit mix led by growth in
noninterest-bearing demand deposits, the cost of total
interest-bearing deposits declined from 1.18% for the quarter ended
December 31, 2011, to 0.84% for the quarter ended December 31,
2012, while the cost of total deposits declined from 1.01% for the
quarter ended December 31, 2011, to 0.69% for the quarter ended
December 31, 2012.
Capital Levels and Stockholders’ Equity
Stockholders’ equity decreased $38.5 million, or 13.6%, from
$283.8 million at December 31, 2011, to $245.3 million at December
31, 2012, with a $67.2 million decline from the repayment of TARP
preferred stock and a $2.8 million decrease in other comprehensive
income, partially offset by net income available to common
stockholders of $22.5 million over the twelve-month period,
approximately $7.0 million in net proceeds from the exercise of
warrants and $2.0 million in proceeds and tax benefits related to
the exercise of options. As a result of these changes, the
Company’s Tier 1 capital ratio decreased from 14.55% at December
31, 2011, to 13.25% at December 31, 2012, and its total qualifying
capital ratio decreased from 15.81% to 14.51% over the same period.
Sequentially, the Company’s Tier 1 and total qualifying capital
ratios are each down 304 basis points, because risk-weighted assets
remained steady at $2.3 billion, while stockholders’ equity
declined $67.2 million due to the repurchase of TARP preferred
stock, and a $2.5 million decrease in other comprehensive income,
which were partially offset by net income available to common
stockholders of $4.2 million in the fourth quarter. The Company’s
tangible common equity ratio increased from 7.37% at December 31,
2011, and 8.08% at September 30, 2012, to 8.69% at December 31,
2012. The 132 basis point increase in tangible common equity ratio
from December 31, 2011 to December 31, 2012, is primarily due to
$22.5 million in retained net income available to common
stockholders for the twelve months ended December 31, 2012.
Sequentially, the 61 basis point increase in tangible common equity
ratio is primarily related to a reduction of $181 million in total
tangible assets, and $4.2 million in retained net income available
to common stockholders for the fourth quarter of 2012, partially
offset by a decrease of $2.5 million in other comprehensive
income.
CONFERENCE CALL
The Company will host a teleconference call for the financial
community on January 17, 2013, at 11:00 a.m. Eastern Standard Time
to discuss the fourth quarter and full year 2012 financial results.
The public is invited to listen to this conference call by dialing
866-793-1301 at least 10 minutes prior to the call.
A replay of the conference call will be available from 2:00 p.m.
Eastern Standard Time on January 17, 2013, until 11:59 p.m. Eastern
Standard Time on January 24, 2013. The public is invited to listen
to this conference call replay by dialing 888-266-2081 and entering
access code 1602565.
ABOUT VIRGINIA COMMERCE BANCORP,
INC.
Virginia Commerce Bancorp, Inc. is the parent bank holding
company for Virginia Commerce Bank, a Virginia state chartered bank
that commenced operations in May 1988. The Bank pursues a
traditional community banking strategy, offering a full range of
business and consumer banking services through twenty-eight branch
offices, one residential mortgage office and one wealth management
services office, principally to individuals and small-to-medium
size businesses in Northern Virginia and the Metropolitan
Washington, D.C. area.
NON-GAAP PRESENTATIONS
The Company prepares its financial statements under accounting
principles generally accepted in the United States, or “GAAP”.
However, this press release also refers to certain non-GAAP
financial measures that we believe, when considered together with
GAAP financial measures, provide investors with important
information regarding our operational performance. An analysis of
any non-GAAP financial measure should be used in conjunction with
results presented in accordance with GAAP.
Adjusted operating earnings is a non-GAAP financial measure that
reflects net income available to common stockholders excluding
impairment loss on securities, realized gains and losses on sale of
securities, death benefits received from bank-owned life insurance,
and other certain non-recurring items. These excluded items are
difficult to predict and we believe that adjusted operating
earnings provides the Company and investors with a valuable measure
of the Company’s operational performance and a valuable tool to
evaluate the Company’s financial results. Calculation of adjusted
operating earnings for the three months ended December 31, 2012,
December 31, 2011, and September 30, 2012, is as follows:
Three Months Three Months Ended Ended December 31,
September 30, (Dollars in thousands)
2012
2011 2012 Net Income Available to
Common Stockholders $4,230 $ 5,434 $7,122 Adjustments to net
income available to common stockholders: Realized gain on sale of
securities (1,454) -- (2,056) Net tax effect adjustment 509 -- 720
Acceleration of the accretion of the preferred stock
discount 2,061 -- --
Adjusted Operating Earnings
$5,346 $ 5,434 $5,786
Earnings per common
share-diluted $ 0.12 $0.17 $0.21 Adjustments to earnings per
common share-diluted Realized gain on sale of securities, net tax
affect $(0.02) -- $(0.04) Acceleration of the accretion of the
preferred stock discount $ 0.06 -- --
Adjusted operating
earnings per common share-diluted $ 0.16 $0.17 $0.17
The adjusted efficiency ratio is a non-GAAP financial measure
that is computed by dividing non-interest expense by the sum of net
interest income on a tax equivalent basis, and non-interest income
excluding impairment loss on securities, realized gains and losses
on sale of securities, and death benefits received from bank-owned
life insurance. We believe that this measure provides investors
with important information about our operating efficiency.
Comparison of our adjusted efficiency ratio with those of other
companies may not be possible because other companies may calculate
the adjusted efficiency ratio differently. Calculation of the
adjusted efficiency ratio for the three months and twelve months
ended December 31, 2012, and December 31, 2011, is as follows:
Three Months Ended Twelve Months Ended
(Dollars in thousands)
December 31, December 31,
2012 2011
2012 2011 Summary Operating
Results: Non-interest expense $16,843 $ 15,852 $
64,239 $ 59,715 Net interest income $26,603 $ 27,102 $
106,667 $ 106,802 Non-interest income 4,375 2,473 17,470
8,145 Impairment loss on securities -- -- -- 732 Gain on sale of
securities (1,454) -- (7,430) (503) Death benefits received from
bank owned life insurance
-- --
-- (361) Adjusted non-interest income $
2,921 $ 2,473 $ 10,040 $ 8,013
Total net interest income and non-interest
income, adjusted (1)
$29,524 $ 29,575 $116,707 $ 114,815
Efficiency Ratio,
adjusted 56.37% 52.95% 54.37% 51.33%
(1) Tax Equivalent Income of $29,879 for the three months ended
December 31, 2012, and $118,153 for the twelve months ended
December 31, 2012. Tax Equivalent Income of $29,935 for the three
months ended December 31, 2011, and $116,330 for the twelve months
ended December 31, 2011.
The tangible common equity ratio is a non-GAAP financial measure
representing the ratio of tangible common equity to tangible
assets. Tangible common equity and tangible assets are non-GAAP
financial measures derived from GAAP-based amounts. We calculate
tangible common equity for the Company by excluding the balance of
intangible assets and outstanding preferred stock issued to the
U.S. Treasury from total stockholders’ equity. We calculate
tangible assets by excluding the balance of intangible assets from
total assets. We had no intangible assets for the periods
presented. We believe that this is consistent with the treatment by
regulatory agencies, which exclude intangible assets from the
calculation of regulatory capital ratios. Accordingly, we believe
that these non-GAAP financial measures provide information that is
important to investors and that is useful in understanding our
capital position and ratios. However, these non-GAAP financial
measures are supplemental and are not substitutes for an analysis
based on a GAAP measure. As other companies may use different
calculations for non-GAAP measures, our presentation may not be
comparable to other similarly titled measures reported by other
companies. Calculation of the Company’s tangible common equity
ratio as of December 31, 2012, December 31, 2011, September 30,
2012 and June 30, 2012 is as follows:
(Dollars in thousands)
As of December
31, September 30 June 30,
2012 2011 2012
2012 Tangible common equity: Total
stockholders’ equity $ 245,309 $283,771 $ 311,528 $ 303,294
Less: Outstanding TARP senior preferred stock -- 67,195 68,621
68,146 Intangible assets
-- --
-- -- Tangible common equity $ 245,309
$216,576 $ 242,907 $ 235,148 Total tangible assets
$2,823,692 $2,938,518 $3,004,742 $3,017,276
Tangible
common equity ratio 8.69% 7.37% 8.08% 7.79%
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS
This press release contains forward-looking statements within
the meaning of the Securities and Exchange Act of 1934, as amended,
including statements of goals, intentions, and expectations as to
future trends, plans, events or results of Company operations and
policies, including but not limited to our outlook on earnings,
including our future net interest margin, and statements regarding
asset quality, our loan and investment security portfolios, our
deposit portfolio and anticipated changes to our deposit costs and
balances, projected growth, capital position, capital strategies,
our plans regarding and expected future levels of our
non-performing assets, business opportunities in our market and
other strategic initiatives or transactions, and general economic
conditions. When we use words such as “may”, “will”, “anticipates”,
“believes”, “expects”, “plans”, “estimates”, “potential”,
“continue”, “should”, and similar words or phrases, you should
consider them as identifying forward-looking statements. These
forward-looking statements are not guarantees of future
performance. These statements are based upon current and
anticipated economic conditions, nationally and in the Company’s
market, interest rates and interest rate policy, competitive
factors, and other conditions which by their nature, are not
susceptible to accurate forecast, and are subject to significant
uncertainty. Because of these uncertainties and the assumptions on
which this release and the forward-looking statements are based,
actual future operations and results may differ materially from
those indicated herein. Readers are cautioned against placing undue
reliance on any such forward-looking statements. The Company’s past
results are not necessarily indicative of future performance. For
additional information regarding factors that could affect the
Company's operations and results, see the Company’s Annual Report
on Form 10-K for the year ended December 31, 2011, and other
reports filed with and furnished to the Securities and Exchange
Commission.
Virginia Commerce Bancorp, Inc. Financial Highlights
(Dollars in thousands, except per share data) (Unaudited)
Three Months Ended December 31, Twelve
Months Ended December 31,
2012 2011
% Change 2012 2011
% Change Summary Financial Results:
Interest and dividend income $32,427
$35,286 -8.1% $132,938 $141,844 -6.3% Interest expense 5,824 8,184
-28.8% 26,271 35,042 -25.0% Net interest income 26,603 27,102 -1.8%
106,667 106,802 -0.1% Provision for loan losses 2,559 3,639 -29.7%
14,826 14,849 -0.2% Non-interest income 4,375 2,473 76.9% 17,470
8,145 114.5% Non-interest expense 16,843 15,852 6.3% 64,239 59,715
7.6% Income before income taxes 11,576 10,084 14.8% 45,072 40,383
11.6% Net income $ 7,752 $ 6,722 15.3% $ 30,100 $ 27,090 11.1%
Effective dividend on preferred stock $ 3,522 $ 1,288 173.4% $
7,612 $ 5,300 43.6% Net income available to common stockholders $
4,230 $ 5,434 -22.2% $ 22,488 $ 21,790 3.2%
Performance
Ratios: Return on average assets 1.03% 0.90% 1.01% 0.95% Return
on average equity 10.20% 9.52% 10.11% 10.23% Net interest margin
3.73% 3.78% 3.74% 3.91% Efficiency ratio, adjusted 56.37% 52.95%
54.37% 51.33%
Per Share Data: Earnings per common
share-basic $0.13 $0.18 -27.8% $0.71 $0.73 -2.7% Earnings per
common share-diluted $0.12 $0.17 -29.4% $0.67 $0.71 -5.6% Average
number of shares outstanding: Basic 31,864,436 30,212,021
31,750,958 29,720,985 Diluted 33,874,852 31,575,158 33,702,769
30,897,811 As of December 31, As of 2012
2011 % Change 09/30/12 % change
Selected
Balance Sheet Data: Loans, net of allowance for loan losses
$2,142,872 $2,120,291 1.1% $2,102,588 1.9% Investment securities
493,424 624,956 -21.0% 545,143 -9.5% Assets 2,823,692 2,938,518
-3.9% 3,004,742 -6.0% Deposits 2,245,392 2,292,158 -2.0% 2,212,556
1.5% Stockholders’ equity 245,309 283,771 -13.6% 311,528 -21.3%
Book value per common share $7.68 $7.17 7.1% $7.63 0.7%
Capital Ratios (% of risk weighted assets): Tier 1 capital:
Company 13.25% 14.55% 16.29% Bank 12.82% 14.21% 15.81% Total
qualifying capital: Company 14.51% 15.81% 17.55% Bank 14.08% 15.47%
17.06% Tier 1 leverage: Company 10.29% 11.61% 12.27% Bank 10.05%
11.40% 12.00% Tangible common equity: Company 8.69% 7.37% 8.08%
(Dollars in thousands) As
of December 31, As of 2012 2011 09/30/12 06/30/12
Asset Quality: Non-performing assets: Non-accrual
loans: Commercial $ 3,317 $ 5,005 $ 3,443 $ 2,540 Real
estate-one-to-four family residential: Permanent first and second
3,606 3,912 5,689 5,500 Home equity loans and lines
2,498 3,142
2,576 3,480 Total real
estate-one-to-four family residential $ 6,104 $ 7,054 $ 8,265 $
8,980 Real estate-multi-family residential -- 476 -- -- Real
estate-non-farm, non-residential: Owner-occupied 1,791 1,999 1,804
3,504 Non-owner-occupied
3,864
-- 4,731 2,079
Total real estate-non-farm, non-residential $ 5,655 $ 1,999 $ 6,535
$ 5,583 Real estate-construction: Residential 16,976 18,479 10,510
12,379 Commercial
5,860
5,505 16,679
16,859 Total real estate-construction $ 22,836 $
23,984 $ 27,189 $ 29,238 Consumer
17
18 18 18 Total
non-accrual loans $ 37,929 $ 38,536 $ 45,450 $ 46,359 OREO
12,302 8,925
14,089 14,018 Total non-performing
assets $ 50,231 $ 47,461 $ 59,539 $ 60,377 Loans 90+ days
past due and still accruing: Commercial $ -- $ -- $ -- $ 45 Real
estate-one-to-four family residential: Permanent first and second
-- 71 -- -- Home equity loans and lines
--
250 --
-- Total real estate-one-to-four family residential $
-- $ 321 $ -- $ -- Real estate-multi-family residential -- -- -- --
Real estate-non-farm, non-residential: Owner-occupied -- -- -- --
Non-owner-occupied
-- --
-- -- Total real
estate-non-farm, non-residential $ -- $ -- $ -- $ -- Real
estate-construction: Residential -- -- -- -- Commercial
-- -- --
-- Total Real estate-construction: $ -- $ -- $
-- $ -- Consumer
-- 11
-- -- Total loans 90+ days
past due and still accruing $ -- $ 332 $ -- $ 45 Total
non-performing assets and 90+ days past due loans $ 50,231 $ 47,793
$ 59,539 $ 60,422 Troubled debt restructurings $ 43,448 $
52,264 $ 44,892 $ 43,054 Non-performing assets to total
loans: 2.29% 2.18% 2.77% 2.77% to total assets: 1.78% 1.62% 1.98%
2.00% Non-performing assets and past due loans to total loans:
2.29% 2.20% 2.77% 2.77% to total assets: 1.78% 1.63% 1.98% 2.00%
Allowance for loan losses to total loans 1.95% 2.24% 1.92% 2.14%
Allowance for loan losses to non-performing loans 112.77% 125.37%
90.84% 100.49% Total allowance for loan losses $ 42,773 $
48,729 $ 41,288 $ 46,632
(Dollars in thousands)
As of December 31, As of 2012 2011 09/30/12 06/30/12
Loans 30 to 89 days past due and still accruing
Commercial $ 366 $ 1,259 $ 313 $ 2,099 Real estate-one-to-four
family residential: Permanent first and second 2,089 3,548 230
4,149 Home equity loans and lines
223
390 395 249
Total real estate-one-to-four family residential $ 2 ,312 $ 3,938 $
625 $ 4,398 Real estate-multi-family residential -- -- -- -- Real
estate-non-farm, non-residential: Owner-occupied 1,688 1,008 7,326
349 Non-owner-occupied
1,661
6,063 4,080
2,979 Total real estate-non-farm, non-residential $
3,349 $ 7,071 $ 11,406 $ 3,328 Real estate-construction:
Residential -- 761 74 -- Commercial
--
-- 930 --
Total real estate-construction: $ -- $ 761 $ 1,004 $ -- Consumer 39
105 12 17 Farmland
-- --
-- -- Total loans 30 to 89
days past due $ 6,066 $ 13,134 $ 13,360 $ 9,842 Three
months ended Twelve months ended December 31, December 31, 2012
2011 2012 2011 Net charge-offs Commercial $
(106) $ 126 $ 4,869 $ 1,685 Real estate-one-to-four family
residential: Permanent first and second 189 226 1,480 2,327 Home
equity loans and lines
94
280 1,945
1,049 Total real estate-one-to-four family residential
$ 283 $ 506 $ 3,425 $ 3,376 Real estate-multi-family residential --
-- ($118) -- Real estate-non-farm, non-residential: Owner-occupied
-- (313) 2,820 (142) Non-owner-occupied
(1,039)
2,632 2,486
8,899 Total real estate-non-farm, non-residential $
(1,039) $ 2,319 $ 5,306 $ 8,757 Real estate-construction:
Residential $ 1,961 $ 1,208 $ 6,489 $ 7,004 Commercial
(19) 128 559
7,622 Total real estate-construction: $ 1,942 $
1,336 $ 7,048 $ 14,626 Consumer (7) 28 251 118 Farmland
-- -- --
-- Total net charge-offs $ 1,073 $ 4,315 $
20,781 $ 28,562 Net charge-offs to average loans outstanding 0.05%
0.20% 0.95% 1.31% Total provision for loan losses $ 2,559 $
3,639 $ 14,826 $ 14,849
Classes of total loans by risk rating as of December 31, 2012,
are summarized as follows (dollars in thousands):
Special
Total Internal Risk Rating Grades Pass
Watch Mention Substandard
Doubtful Loans Commercial $
202,088 $ 25,048 $ 11,976 $ 19,822 $ 2,073 $ 261,007 Real
estate-one-to-four family residential: Permanent first and second
235,672 15,585 12,233 19,038 112 282,640 Home equity loans and
lines
106,872 2,724
1,871 4,165
1,543 117,175 Total real
estate-one-to-four family residential $ 342,544 $ 18,309 $ 14,104 $
23,203 $ 1,655 $ 399,815 Real estate-multi-family residential
73,317 5,080 -- -- -- 78,397 Real estate-non-farm, non-residential:
Owner-occupied 384,923 46,123 35,675 19,757 -- 486,478
Non-owner-occupied
488,415
108,868 30,094
41,378 --
668,755 Total real estate-non-farm, non-residential $
873,338 $ 154,991 $ 65,769 $ 61,135 $ -- $ 1,155,233 Real
estate-construction: Residential 104,835 17,651 20,720 26,771 --
169,977 Commercial
41,336
18,645 26,281
25,800 --
112,062 Total real estate-construction $ 146,171 $
36,296 $ 47,001 $ 52,571 $ -- $ 282,039 Consumer 7,744 208 219 95
-- 8,266 Farmland 1,000 3,888
-- -- -- 4,888
Total $ 1,646,202 $
243,820 $ 139,069 $
156,826 $ 3,728 $
2,189,645
Classes of total loans by risk rating as of December 31, 2011,
are summarized as follows (dollars in thousands):
Special
Total Internal Risk Rating Grades Pass
Watch Mention Substandard
Doubtful Loans Commercial $
172,457 $ 51,935 $ 1,506 $ 22,178 $ 4,306 $ 252,382 Real
estate-one-to-four family residential: Permanent first and second
195,786 16,726 7,004 26,904 -- 246,420 Home equity loans and lines
111,800 4,937
1,441 6,105
2,247 126,530 Total real
estate-one-to-four family residential $ 307,586 $ 21,663 $ 8,445 $
33,009 $ 2,247 $ 372,950 Real estate-multi-family residential
71,756 4,274 -- 476 -- 76,506 Real estate-non-farm,
non-residential: Owner-occupied 357,480 62,766 21,777 18,750 --
460,773 Non-owner-occupied
481,584
111,779 31,361
47,413 --
672,137 Total
real estate-non-farm, non-residential $ 839,064 $ 174,545 $ 53,138
$ 66,163 $ -- $ 1,132,910 Real estate-construction: Residential
70,323 30,546 12,984 37,264 -- 151,117 Commercial
63,520 59,217
27,395 25,168 --
175,300 Total real estate-construction $ 133,843 $
89,763 $ 40,379 $ 62,432 $ -- $ 326,417 Consumer 8,169 233 119 71
-- 8,592 Farmland 2,573 --
-- -- -- 2,573
Total $ 1,535,448 $
342,413 $ 103,587 $
184,329 $ 6,553 $
2,172,330
Classes of total loans by risk rating as of September 30, 2012,
are summarized as follows (dollars in thousands):
Special
Total Internal Risk Rating Grades Pass
Watch Mention Substandard
Doubtful Loans Commercial $
163,539 $ 28,262 $ 14,710 $ 21,630 $ 1,810 $ 229,951 Real
estate-one-to-four family residential: Permanent first and second
231,543 14,590 11,252 22,651 114 280,150 Home equity loans and
lines
108,153 2,737
1,968 4,243
1,545 118,646 Total real
estate-one-to-four family residential $ 339,696 $ 17,327 $ 13,220 $
26,894 $ 1,659 $ 398,796 Real estate-multi-family residential
81,738 5,104 -- -- -- 86,842 Real estate-non-farm, non-residential:
Owner-occupied 357,423 66,865 21,376 21,591 -- 467,255
Non-owner-occupied
483,742
131,036 33,608
43,076 --
691,462 Total real estate-non-farm, non-residential $
841,165 $ 197,901 $ 54,984 $ 64,667 $ -- $ 1,158,717 Real
estate-construction: Residential 81,656 18,262 18,095 37,757 --
155,770 Commercial
33,365
15,277 28,560
27,935 --
105,137 Total real estate-construction $ 115,021 $
33,539 $ 46,655 $ 65,692 $ -- $ 260,907 Consumer 6,585 230 222 104
-- 7,141 Farmland 1,000 3,889
-- -- -- 4,889
Total $ 1,548,744 $
286,252 $ 129,791 $
178,987 $ 3,469 $
2,147,243
Classes of total loans by risk rating as of June 30, 2012, are
summarized as follows (dollars in thousands):
Special
Total Internal Risk Rating Grades Pass
Watch Mention Substandard
Doubtful Loans Commercial $
188,952 $ 29,560 $ 11,729 $ 24,563 $ 1,810 $ 256,614 Real
estate-one-to-four family residential: Permanent first and second
228,273 14,069 10,285 25,141 114 277,882 Home equity loans and
lines
110,765 2,851
2,119 5,978
2,240 123,953 Total real
estate-one-to-four family residential $ 339,038 $ 16,920 $ 12,404 $
31,119 $ 2,354 $ 401,835 Real estate-multi-family residential
80,717 3,460 -- -- -- 84,177 Real estate-non-farm, non-residential:
Owner-occupied 367,535 62,369 25,067 16,490 -- 471,461
Non-owner-occupied
510,605
102,602 26,174
44,792 --
684,173 Total real estate-non-farm, non-residential $
878,140 $ 164,971 $ 51,241 $ 61,282 $ -- $ 1,155,634 Real
estate-construction: Residential 75,605 22,476 19,807 29,176 --
147,064 Commercial
40,181
18,090 26,702
38,903 --
123,876 Total real estate-construction $ 115,786 $
40,566 $ 46,509 $ 68,079 $ -- $ 270,940 Consumer 8,093 307 165 73
-- 8,638 Farmland 3,415 158
-- -- -- 3,573
Total $ 1,614,141 $
255,942 $ 122,048 $
185,116 $ 4,164 $
2,181,411
Classes of total loans by risk rating as of March 31, 2012, are
summarized as follows (dollars in thousands):
Special
Total Internal Risk Rating Grades Pass
Watch Mention Substandard
Doubtful Loans Commercial $
175,523 $ 34,782 $ 4,997 $ 23,427 $ 9,108 $ 247,837 Real
estate-one-to-four family residential: Permanent first and second
205,804 15,342 10,163 25,154 115 256,578 Home equity loans and
lines
111,181 3,288
1,902 8,420
2,243 127,034 Total real
estate-one-to-four family residential $ 316,985 $ 18,630 $ 12,065 $
33,574 $ 2,358 $ 383,612 Real estate-multi-family residential
76,304 4,253 -- 476 -- 81,033 Real estate-non-farm,
non-residential: Owner-occupied 369,014 63,240 25,360 16,267 --
473,881 Non-owner-occupied
505,373
119,446 37,154
29,872 --
691,845 Total real estate-non-farm, non-residential $
874,387 $ 182,686 $ 62,514 $ 46,139 $ -- $ 1,165,726 Real
estate-construction: Residential 65,280 22,329 20,100 29,048 --
136,757 Commercial
39,092
20,483 36,037
26,055 --
121,667 Total real estate-construction $ 104,372 $
42,812 $ 56,137 $ 55,103 $ -- $ 258,424 Consumer 8,259 291 167 67
-- 8,784 Farmland 2,574 --
-- -- -- 2,574
Total $ 1,558,404 $
283,454 $ 135,880 $
158,786 $ 11,466 $
2,147,990
Troubled Debt Restructurings (TDRs) By
Loan Type
As of December 31, 2012 Reviewable TDRs Permanent
TDRs Total TDRs
(Dollars in thousands)
# of As % of # of As % of # of
As % of Loans Balance Balance Loans
Balance Balance Loans Balance Balance
Loan
Type: Commercial -- -- 0.0% 2 $6,875 29.2% 2 $6,875 15.8%
Real estate-one-to-four family
residential:
Permanent first and second 11 4,303 21.7% -- -- 0.0% 11 4,303 10.0%
Home equity loans and lines
-- --
0.0% -- -- 0.0%
-- -- 0.0%
Total real estate-one-to-four family
residential:
11 $4,303 21.7% -- -- 0.0% 11 $4,303 10.0% Real estate-multi-family
residential -- -- 0.0% -- -- 0.0% -- -- 0.0% Real estate-non-farm,
non-residential Owner-occupied 2 6,771 34.1% 1 2,757 11.7% 3 9,528
21.9% Non-owner-occupied
2 8,793
44.2% 2 6,986
29.6% 4 15,779
36.3%
Total real estate-non-farm,
non-residential:
4 $15,564 78.3% 3 $9,743 41.3% 7 $25,307 58.2% Real
estate-construction: Residential -- -- 0.0% 1 73 0.3% 1 73 0.2%
Commercial
-- -- 0.0%
3 6,890 29.2% 3
6,890 15.8% Total real
estate-construction: -- -- 0.0% 4 $6,963 29.5% 4 $6,963 16.0%
Consumer -- -- 0.0% -- -- 0.0% -- -- 0.0% Farmland
--
-- 0.0% -- --
0.0% -- -- 0.0%
Total Loans 15 $19,867 100.0% 9 $23,581 100.0% 24 $43,448 100.0%
Troubled Debt Restructurings (TDRs) By
Quarterly Review / Maturity Date
As of December 31, 2012 Reviewable TDRs Permanent
TDRs Total TDRs
(Dollars in thousands)
# of As % of # of As % of # of
As % of Loans Balance Balance Loans
Balance Balance Loans Balance Balance
Review / Maturity by Quarter: 2012 4th Quarter
-- -- 0.0% 5
5,241 22.2% 5
5,241 12.1% Total 2012: -- -- 0.0% 5
$5,241 22.2% 5 $5,241 12.1%
2013 1st Quarter 9 11,695 58.9%
-- -- 0.0% 9 11,695 26.9% 2nd Quarter -- -- 0.0% -- -- 0.0% -- --
0.0% 3rd Quarter 3 608 3.1% -- -- 0.0% 3 608 1.4% 4th Quarter
1 793 3.9% --
-- 0.0% 1 793
1.8% Total 2013: 13 $13,096 65.9% -- -- 0.0% 13
$13,096 30.1%
2014 1st Quarter -- -- 0.0% -- -- 0.0% -- --
0.0% 2nd Quarter -- -- 0.0% -- -- 0.0% -- -- 0.0% 3rd Quarter 2
6,771 34.1% 1 5,580 23.7% 3 12,351 28.5% 4th Quarter
-- -- 0.0% 1
5,400 22.9% 1
5,400 12.4% Total 2014: 2 $6,771 34.1% 2
$10,980 46.6% 4 $17,751 40.9%
2015 & beyond
-- -- 0.0% 2
$7,360 31.2% 2
$7,360 16.9% Total Loans 15
$19,867 100.0% 9 $23,581 100.0% 24 $43,448 100.0%
Trouble Debt
Restructurings (TDRs) – Migration by Quarter
10/1/09 As of December 31, 2012 4/1/09 to
7/1/09 to to 1/1/10 to 4/1/10 to
7/1/10 to 10/1/10 to 1/1/11 to
(Dollars in thousands)
6/30/09 9/30/09 12/31/09 3/31/10
6/30/10 9/30/10 12/31/10 3/31/11
Period Beginning Balance -- $33,309 $37,425 $71,885 $80,993
$ 96,976 $105,617 $102,996
Additions: New Loans Added
$33,309 $ 5,226 $37,663 $23,477 $21,720 $ 12,698 $ 12,377 $ 3,188
Loan Advances
-- 974 348
219 472 220 531
486 Subtotal Additions: $33,309 $ 6,200 $38,011
$23,696 $22,192 $ 12,918 $ 12,908 $ 3,674
Deductions:
Sales Proceeds -- $ 944 $ 1,783 $ 1,218 $ 761 -- $ 125 $ 367
Payments -- 317 174 50 1,202 1,138 433 1,989 Reviews -- -- 229 75
3,714 2,468 -- 5,731 Upgrades -- -- -- -- -- -- 11,000 -- Partial
C/Os w/Continuing TDRs -- -- -- -- -- -- -- 5,656 Charge-offs
w/Loans Sold or Settled -- -- 56 -- -- -- -- 251 Transfer to NPA
-- 823 1,309
13,245 532 671
3,971 800 Subtotal Deductions: -- $ 2,084
$ 3,551 $14,588 $ 6,209 $ 4,277 $ 15,529 $ 14,794
Net
Increase / (Decrease) $33,309 $ 4,116 $34,460 $ 9,108 $15,983 $
8,641 ($ 2,621) ($ 11,120)
% Increase / (Decrease) from
Preceding Period 12.4% 92.1% 12.7% 19.7% 8.9% (2.5%) (10.8%)
Period Ended Balance $33,309 $37,425 $71,885 $80,993
$96,976 $105,617 $102,996 $ 91,876
10/1/11
4/1/11 to 7/1/11 to to 1/1/12 to
4/1/12 to 7/1/12 to 10/1/12 to 6/30/11
9/30/11 12/31/11 3/31/12 6/30/12
9/30/12 12/31/12 TOTAL Period Beginning
Balance $91,876 $81,070 $71,686 $52,264 $42,426 $43,054 $44,892
Additions: New Loans Added $ 116 $ 984 $ 753 $ 541 $
1,345 $ 8,804 $ 6,771 $168,972 Loan Advances
197
53 40 236 186
46 65 4,073 Subtotal
Additions: $ 313 $ 1,037 $ 793 $ 777 $ 1,531 $ 8,850 $ 6,836
$173,045 Deductions: Sales Proceeds $ 126 $
4,597 $ 6,168 $ 5,098 $ 247 $ 531 $ 3,904 $25,869 Payments 1,715
532 990 226 158 785 72 9,781 Reviews 640 4,292 10,111 3,888 498
1,465 635 33,746 Upgrades -- -- -- -- -- -- 3392 14,392 Partial
C/Os w/Continuing TDRs 3,000 -- -- -- -- 2,587 0 11,243 Charge-offs
w/Loans Sold or Settled -- -- 2,946 604 -- -- 0 3,857 Transfer to
NPA
5,638 1,000 --
799 -- 1,644
277 30,709 Subtotal Deductions: $11,119
$10,421 $20,215 $10,615 $ 903 $ 7,012 $ 8,280
$129,597
Net Increase / (Decrease) ($10,806) ($9,384)
($19,422) ($9,838) $ 628 $ 1,838 ($1,444)
% Increase /
(Decrease) from Preceding Period (11.8%) (11.6%) (27.1%)
(18.8%) 1.5% 4.3% (3.20%)
Period Ended Balance
$81,070 $71,686 $52,264 $42,426 $43,054 $44,892
$43,448
$43,448 (Dollars in thousands) As of
December 31, As of 2012 2011 % Change 09/30/12
% Change
Loan Portfolio: Commercial $
261,007 $ 252,382 3.4% $ 229,951 13.5% Real estate-one to four
family residential: Permanent first and second 282,640 246,420
14.7% 280,150 0.9% Home equity loans and lines
117,175 126,530 -7.4%
118,646 -1.2% Total real
estate-one-to-four family residential $ 399,815 $ 372,950 7.2% $
398,796 0.3% Real estate-multifamily residential 78,397 76,506 2.5%
86,842 -9.7% Real estate-non-farm, non-residential: Owner-occupied
486,478 460,773 5.6% 467,255 4.1% Non-owner-occupied
668,755 672,137 -0.5%
691,462 -3.3% Total real
estate-non-farm, non-residential $ 1,155,233 $ 1,132,910 2.0% $
1,158,717 -0.3% Real estate-construction: Residential 169,977
151,117 12.5% 155,770 9.1% Commercial
112,062
175,300 -36.1%
105,137 6.6% Total real
estate-construction: $ 282,039 $ 326,417 -13.6% $ 260,907 8.1%
Consumer 8,266 8,592 -3.8% 7,141 15.8% Farmland
4,888 2,573 90.0%
4,889 -- Total loans $ 2,189,645 $
2,172,330 0.8% $ 2,147,243 2.0% Less unearned income 4,000 3,310
20.8% 3,367 18.8% Less allowance for loan losses
42,773 48,729 -12.2%
41,288 3.6% Loans, net of
allowance for loan losses $ 2,142,872 $ 2,120,291 1.1% $ 2,102,588
1.9% As of December 31, 2012
Residential,
Acquisition, Development and Construction
By County/Jurisdiction of
Origination:
(Dollars in thousands)
TotalOutstandings
Percentageof Total
Non-accrualLoans
Non-accrualsas a % ofOutstandings
Net charge-offsas a % ofOutstandings
District of Columbia $ 9,353 5.5% $ 495 0.3%
-- Montgomery, MD -- -- -- -- -- Prince Georges, MD 8,828 5.2%
4,061 2.4% 1.6% Other Counties in MD 5,099 3.0% 65 0.1% 0.1%
Arlington/Alexandria, VA 33,295 19.7% -- -- 0.2% Fairfax, VA 29,162
17.2% -- -- 0.2% Culpeper/Fauquier, VA 11,614 6.8% 200 0.1% --
Frederick, VA 2,288 1.3% 2,288 1.3% 0.8% Loudoun, VA 15,190 8.9%
279 0.2% 0.2% Prince William, VA 15,285 9.0% -- -- -- Spotsylvania,
VA 345 0.2% -- -- -- Stafford, VA 33,875 19.9% 8,754 5.1% 0.7%
Other Counties in VA 3,427 2.0% 835 0.5% -- Outside VA, D.C. &
MD
2,216 1.3% --
-- -- $169,977 100.0% $16,976 10.0% 3.8%
As of December 31, 2012
Commercial, Acquisition,
Development and
Construction Non-accruals
Net charge-
By County/Jurisdiction of Origination: Total Percentage
Non-accrual as a % of
offs as a % of
(Dollars in thousands)
Outstandings of Total Loans Outstandings
Outstandings District of Columbia $ 144 0.0 % $ -- -- --
Montgomery, MD 1,946 1.7 % -- -- -- Prince Georges, MD 6,364 5.7 %
-- -- -- Other Counties in MD 2,104 1.9 % -- -- --
Arlington/Alexandria, VA 12,340 11.0 % 510 0.5 % -- Fairfax, VA
8,281 7.4 % 2,375 2.1 % 0.3 % Culpeper/Fauquier, VA 2,975 2.7 %
2,975 2.7 % 0.1 % Frederick, VA 2,000 1.8 % -- -- -- Henrico, VA --
-- -- -- -- Loudoun, VA 13,913 12.4 % -- -- -- Prince William, VA
38,494 34.4 % -- -- 0.1 % Spotsylvania, VA 1,670 1.5 % -- -- --
Stafford, VA 17,289 15.4 % -- -- -- Other Counties in VA 4,542 4.1
% -- -- -- Outside VA, D.C. & MD
--
-- -- --
-- $ 112,062 100.0 % $ 5,860 5.3 % 0.5 %
As of December 31, 2012
Non-Farm/Non-Residential Non-accruals
Net charge-
By County/Jurisdiction of Origination: Total Percentage
Non-accrual as a % of
offs as a % of
(Dollars in thousands)
Outstandings of Total Loans Outstandings
Outstandings District of Columbia $ 83,131 7.2 % $ -- -- --
Montgomery, MD 18,966 1.6 % 1,786 0.2 % -- Prince Georges, MD
64,947 5.6 % -- -- -- Other Counties in MD 42,469 3.7 % -- -- 0.2 %
Arlington/Alexandria, VA 185,077 16.0 % -- -- -- Fairfax, VA
272,511 23.6 % 829 0.1 % -- Culpeper/Fauquier, VA 5,126 0.4 % 2,079
0.2 % -- Frederick, VA 7,685 0.7 % -- -- -- Henrico, VA 21,705 1.9
% -- -- -- Loudoun, VA 147,580 12.8 % 962 0.1 % -- Prince William,
VA 193,512 16.8 % -- -- -- Spotsylvania, VA 18,992 1.6 % -- -- --
Stafford, VA 19,450 1.7 % -- -- 0.2 % Other Counties in VA 65,892
5.7 % -- -- 0.1 % Outside VA, D.C. & MD
8,188 0.7 %
-- -- -- $
1,155,233 100.0 % $ 5,655 0.6 % 0.5 %
Of this total of $1.2 billion in non-farm/non-residential real
estate loans, approximately $112.4 million will mature in 2013,
$143.1 million in 2014, and $87.4 million in 2015.
(Dollars in thousands) As of December
31, As of 2012
2011 % Change 9/30/12 %
Change
Investment Securities:
Available-for-sale (AFS) (at fair value): U.S. government treasury
obligations $ -- $ -- -- $ 15,000 -100.0 % U.S. government agency
obligations 392,867 523,987 -25.0 % 429,416 -8.5 % Pooled trust
preferred securities 357 456 -21.7 % 358 -0.3 % Obligations of
states and political subdivisions
100,200
68,621 46.0 %
100,369 -0.2 % $ 493,424 $
593,064 -16.8 % $ 545,143 -9.5 % Held-to-maturity (HTM) (at
amortized cost): U.S. government agency obligations $ -- $ 3,763
-100.0 % $ -- -- Obligations of states and political subdivisions
-- 28,129
-100.0 % --
-- $ -- $ 31,892 -100.0 % $ -- -- Total
Investment Securities $ 493,424 $ 624,956 -21.0 % $ 545,143 -9.5 %
Virginia Commerce Bancorp, Inc. Consolidated Balance
Sheets (Dollars in thousands, except per share data) (Unaudited)
As of December 31, As of September 30, 2012
2011 2012
Assets Cash and due from
banks $ 49,531 $ 31,569 $ 29,620 Investment securities, AFS 493,424
593,064 545,143 Investment securities, HTM (fair value: $34,431 at
December 31, 2011) -- 31,892 -- Restricted stocks, at cost 10,147
11,214 11,272 Interest bearing deposits in other banks 1,000 51,000
213,973 Loans held-for-sale 15,195 18,485 19,330 Loans, net of
allowance for loan losses of $42,773, $48,729, and $41,288
2,142,872 2,120,291 2,102,588 Bank premises and equipment, net
10,072 11,413 10,511 Accrued interest receivable 8,563 10,007 9,541
Other real estate owned, net of valuation allowance of $6,374,
$6,517, and $5,287 12,302 8,925 14,089 Bank-owned life insurance
44,393 14,017 14,176 Other assets 36,193 36,641
34,499 Total assets $ 2,823,692 $ 2,938,518 $ 3,004,742
Liabilities and Stockholders’ Equity Deposits
Demand deposits $ 416,091 $ 337,937 $ 390,692 Savings and
interest-bearing demand deposits 1,200,397 1,173,568 1,174,789 Time
deposits 628,904 780,653 647,075 Total
deposits $ 2,245,392 $ 2,292,158 $ 2,212,556 Securities sold under
agreement to repurchase 250,718 263,273 409,320 Other borrowed
funds 7,000 25,000 -- Trust preferred capital notes 66,827 66,570
66,762 Accrued interest payable 1,885 2,418 2,131 Other liabilities
6,561 5,328 2,445 Total liabilities $
2,578,383 $ 2,654,747 $ 2,693,214
Stockholders’ Equity
Preferred stock, net of discount, $1.00 par value per share,
1,000,000 shares authorized, Series A; $1,000 stated value; 71,000
issued and outstanding in 2011 and September 2012 -- 67,195 68,621
Common stock, $1.00 par value per share, 50,000,000 shares
authorized, issued and outstanding December 2012, 31,920,756
including 110,215 in unvested restricted stock issued; December
2011, 30,263,672 including 49,998 in unvested restricted stock
issued; September 2012, 31,824,756 including 110,215 in unvested
restricted stock issued 31,811 30,214 31,715 Surplus 118,508
111,042 117,905 Warrants 8,520 8,520 8,520 Retained earnings 83,487
60,999 79,258 Accumulated other comprehensive income, net
2,983 5,801 5,509 Total stockholders’ equity $
245,309 $ 283,771 $ 311,528 Total liabilities and stockholders’
equity $ 2,823,692 $ 2,938,518 $ 3,004,742 Virginia
Commerce Bancorp, Inc. Consolidated Statements of Operations
(Dollars in thousands except per share data) (Unaudited)
Three Months Ended Twelve Months Ended December 31,
September 30, December 31, 2012 2011 2012 2012
2011
Interest and dividend income:
Interest and fees on loans $ 29,429 $ 31,562 $ 29,820 $ 120,297 $
126,706 Interest and dividends on investment securities: Taxable
2,210 2,986 2,232 9,538 12,163 Tax-exempt 563 593 574 2,311 2,370
Dividends on restricted stocks 118 95 105 428 382 Interest on
federal funds sold -- -- -- -- 152 Interest on deposits in other
banks 107 50 132 364
71 Total interest and dividend income $ 32,427
$ 35,286 $ 32,863 $ 132,938 $ 141,844
Interest
expense: Deposits $ 3,880 $ 5,860 $ 4,261 $ 17,548 $ 26,038
Securities sold under agreement to repurchase 973 1,094 1,017 4,041
3,953 Other borrowed funds -- 272 242 779 1,078 Trust preferred
capital notes 971 958 975
3,903 3,973 Total interest expense $ 5,824 $
8,184 $ 6,495 $ 26,271 $ 35,042
Net interest
income $ 26,603 $ 27,102 $ 26,368 $ 106,667 $ 106,802 Provision
for loan losses 2,559 3,639
3,111 14,826 14,849 Net interest income after
provision for loan losses $ 24,044 $ 23,463 $ 23,257
$ 91,841 $ 91,953
Non-interest income: Service
charges and other fees $ 919 $ 873 $ 882 $ 3,557 $ 3,303
Non-deposit investment services commissions 181 337 211 886 1,390
Fees and net gains on loans held-for-sale 1,572 1,123 1,082 4,485
2,922 Gain on sale of securities 1,454 -- 2,056 7,430 503
Impairment loss on securities -- -- -- -- (732) Bank-owned life
insurance 217 55 50 376 599 Other 32 85
444 736 160 Total non-interest income $
4,375 $ 2,473 $ 4,725 $ 17,470 $ 8,145
Non-interest expense: Salaries and employee benefits $ 7,407
$ 7,411 $ 7,493 $ 29,924 $ 27,087 Occupancy expense 2,358 2,420
2,380 9,500 9,426 FDIC insurance 617 961 660 3,105 4,355 Loss
(gain) on other real estate owned 1,615 62 (141) 3,181 1,084 Other
real estate owned expenses 92 181 322 994 797 Franchise tax expense
936 779 935 3,371 3,105 Data processing expense 770 772 664 2,762
2,664 Other operating expense 3,048 3,316
2,899 11,402 11,197 Total
non-interest expense $ 16,843 $ 15,852 $ 15,212 $
64,239 $ 59,715 Income before taxes $ 11,576 $ 10,084 $
12,770 $ 45,072 $ 40,383 Provision for income taxes 3,824
3,362 4,284 14,972
13,293
Net income $ 7,752 $ 6,722 $ 8,486 $
30,100 $ 27,090 Effective dividend on preferred stock $
3,522 $ 1,288 $ 1,364 $ 7,612 $ 5,300
Net
income available to common stockholders $ 4,230 $ 5,434 $ 7,122
$ 22,488 $ 21,790 Earnings per common share, basic $ 0.13 $ 0.18 $
0.22 $ 0.71 $ 0.73 Earnings per common share, diluted $ 0.12 $ 0.17
$ 0.21 $ 0.67 $ 0.71
Virginia Commerce Bancorp, Inc. Consolidated
Average Balances, Yields, and Rates Three Months Ended December 31,
(Unaudited)
2012 2011 Interest Average Interest Average
(Dollars in thousands)
Average Income- Yields Average Income- Yields Balance
Expense /Rates Balance Expense /Rates
Assets Securities (1) $ 543,120 $ 2,773 2.26 % $624,178
$3,579 2.55 % Restricted stock 10,794 118 4.34 % 9,664 95 3.95 %
Loans, net of unearned income (2) 2,160,768 29,429 5.43 % 2,175,950
31,562 5.77 % Interest-bearing deposits in other banks 163,655
107 0.26 % 73,678 50 0.27 %
Total
interest-earning assets $2,878,337 $32,427 4.53 % $2,883,470
$35,286 4.90 % Other assets 107,447 66,809
Total Assets
$2,985,784 $2,950,279
Liabilities and Stockholders’
Equity Interest-bearing deposits: NOW accounts $ 424,114 $ 363
0.34 % $ 312,717 $364 0.46 % Money market accounts 237,037 195 0.33
% 224,205 405 0.72 % Savings accounts 541,836 442 0.32 % 645,394
1,197 0.74 % Time deposits 637,926 2,880 1.80 %
788,742 3,894 1.96 % Total interest-bearing deposits
$1,840,913 $ 3,880 0.84 % $1,971,058 $5,860 1.18 % Securities sold
under agreement to repurchase (3) 356,590 973 1.08 % 256,502 1,094
1.69 % Other borrowed funds -- -- -- 25,000 272 4.25 % Trust
preferred capital notes 66,791 971 5.69 % 66,536
958 5.64 %
Total interest-bearing liabilities
$2,264,294 $ 5,824 1.02 % $2,319,096 $8,184 1.40 % Demand deposits
and other liabilities 420,026 351,128
Total liabilities
$2,684,320 $2,670,224 Stockholders’ equity 301,464 280,055
Total
liabilities and stockholders’ equity $2,985,784 $2,950,279
Interest rate spread 3.51 % 3.50 % Net interest income and margin
$26,603 3.73 % $27,462 3.78 % (1) Yields on
securities available-for-sale have been calculated on the basis of
historical cost and do not give effect to changes in the fair value
of those securities, which are reflected as a component of
stockholders’ equity. Average yields on securities are stated on a
tax equivalent basis, using a 35% rate. (2) Loans placed on
non-accrual status are included in the average balances. Net loan
fees and late charges included in interest income on loans totaled
$1.6 million and $1.2 million for the three months ended December
31, 2012 and 2011, respectively. (3) The securities sold
under agreement to repurchase related to customers had an average
balance of $281.6 million at an average rate of 0.17% for the three
months ended December 30, 2012, and $181.5 million at an average
rate of 0.53% for the same period 2011. Also, included are
wholesale agreements with an average balance of $75.0 million at an
average rate of 4.52% for the three months ended December 31, 2012,
and $75.0 million at an average rate of 4.51% for the same period
for 2011.
Virginia Commerce Bancorp, Inc. Consolidated Average
Balances, Yields, and Rates Twelve Months Ended December 31,
(Unaudited)
2012 2011 Interest Average Interest Average
Average Income- Yields Average Income- Yields
(Dollars in thousands)
Balance Expense /Rates Balance Expense
/Rates
Assets Securities (1) $ 571,763 $ 11,849 2.28 %
$499,996 $14,533 3.15 % Restricted stock 11,139 428 3.84 % $11,533
$382 3.32 % Loans, net of unearned income (2) 2,169,441 120,297
5.56 % 2,176,439 126,706 5.84 % Interest-bearing deposits in other
banks 140,631 364 0.26 % 27,640 71 0.26 % Federal funds sold --
-- -- 56,026 152 0.27 %
Total
interest-earning assets $2,892,974 $132,938 4.65 % $2,771,634
$141,844 5.17 % Other assets 76,452 79,176
Total Assets
$2,969,426 $2,850,810
Liabilities and Stockholders’
Equity Interest-bearing deposits: NOW accounts $ 371,740 $
1,335 0.36 % $ 318,448 $2,139 0.67 % Money market accounts 229,748
899 0.39 % 205,058 1,948 0.95 % Savings accounts 585,229 2,443 0.42
% 665,708 6,162 0.93 % Time deposits 692,269 12,871
1.86 % 782,435 15,789 2.02 % Total interest-bearing
deposits $1,878,986 $17,548 0.93 % $1,971,649 $26,038 1.32 %
Securities sold under agreement to repurchase (3) 330,598 4,041
1.22 % 200,199 3,953 1.97 % Other borrowed funds 18,052 779 4.25 %
25,000 1,078 4.31 % Trust preferred capital notes 66,695
3,903 5.85 % 66,441 3,973 5.98 %
Total
interest-bearing liabilities $2,294,331 $26,271 1.15 %
$2,263,289 $35,042 1.55 % Demand deposits and other liabilities
377,357 322,705
Total liabilities $2,671,688 $2,585,994
Stockholders’ equity 297,738 264,816
Total liabilities and
stockholders’ equity $2,969,426 $2,850,810 Interest rate spread
3.50 % 3.62 % Net interest income and margin $106,667 3.74 %
$108,316 3.91 % (1) Yields on securities
available-for-sale have been calculated on the basis of historical
cost and do not give effect to changes in the fair value of those
securities, which are reflected as a component of stockholders’
equity. Average yields on securities are stated on a tax equivalent
basis, using a 35% rate. (2) Loans placed on non-accrual
status are included in the average balances. Net loan fees and late
charges included in interest income on loans totaled $5.3 million
and $4.2 million for the twelve months ended December 31, 2012 and
2011, respectively. (3) The securities sold under agreement
to repurchase related to customers had an average balance of $255.6
million at an average rate of 0.25% for the twelve months ended
December 30, 2012, and $25.2 million at an average rate of 0.46%
for the same period 2011. Also, included are wholesale agreements
with an average balance of $75.0 million at an average rate of
4.52% for the twelve months ended December 31, 2012, and $75.0
million at an average rate of 4.52% for the same period for 2011.
Virginia Commerce Bancorp (MM) (NASDAQ:VCBI)
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Virginia Commerce Bancorp (MM) (NASDAQ:VCBI)
過去 株価チャート
から 7 2023 まで 7 2024