Eagle Bancorp, Inc. Announces 59% Increase in Net Earnings for Full
Year 2004 Over 2003 BETHESDA, Md., Jan. 19 /PRNewswire-FirstCall/
-- Eagle Bancorp, Inc. (NASDAQ:EGBN), the parent company of
EagleBank, today announced net income of $5.1 million for the year
ended December 31, 2004, compared to $3.2 million for the year
ended December 31, 2003, an increase of 59%. On a per-share basis,
the Company earned $0.94 per basic share and $0.90 per diluted
share for 2004 as compared to $0.82 per basic share and $0.77 cents
per diluted share for 2003. Comparisons in earnings per share
between 2004 and 2003 are affected by an increase in the number of
outstanding shares resulting from the issuance of approximately 2.4
million shares in August 2003. For the full year 2004, the Company
reported a return on average assets (ROAA) of 1.04%. This is the
first time the Company has reported a ROAA in excess of 1.00%. For
the year 2003, the ROAA was .86%. Return on average equity was
9.16% for the full year 2004, as compared to 9.45% for 2003. This
ratio was affected by the larger average capital base during 2004
resulting from the August 2003 issuance of shares. Average equity
was 11.38% of average assets for 2004 as compared to 9.05% for
2003. Net earnings for the full year 2004 were positively affected
by strong growth in loans and deposits, an improved net interest
margin, continuing favorable asset quality and good growth in
non-interest income revenues. For the fourth quarter of 2004, net
income was $1.8 million ($0.34 per basic share and $0.32 per
diluted share) as compared to $815 thousand ($0.15 per basic share
and $0.15 per diluted share) for the same quarter in 2003,
representing a 125% increase. A number of factors contributed to
the very strong fourth quarter results, which contributed
significantly to the Company's record earnings for the full year
2004. As anticipated by management, a problem credit of
approximately $2.2 million was resolved in the fourth quarter with
the loan being paid in full. This resolution allowed the Company to
recognize approximately $200 thousand of pre-tax non-recurring
income from the recovery of collection expenses advanced in prior
periods, default interest and the recognition of late charges
accumulated on the loan account. Both lending and deposit activity
were strong in the fourth quarter, and permitted the Company's net
interest income to benefit from increased volumes, in addition to
the improved net interest margin discussed below. Non-interest
income in the fourth quarter of 2004 was $1.3 million compared to
$803 thousand in the fourth quarter of 2003. This increase was due
primarily to increased amounts of gains on the sale of both SBA
loans, where EagleBank is a leading lender in its marketplace, and
increased amounts of gains on the sale of residential mortgage
loans. These same factors together with increases in the amount of
gains on the sale of investment securities represented the primary
increases for the full year 2004 over 2003 in the noninterest
income category. Throughout the year 2004, the Company has
maintained a favorable net interest margin, and as expected,
experienced an increased net interest margin as interest rates
began to rise during 2004. For the year 2004, the Company's net
interest margin improved to 4.36% compared to 4.14% for the year
2003. Deposit and loan growth were particularly strong in the
fourth quarter, with deposits increasing 12%, compared to an
increase for the full year 2004 of 38%, while loans increased 14%
in the fourth quarter, compared to an increase for the full year
2004 of 31%. The Company was in part able to improve the net
interest margin, through continued reliance on core deposits. A
significant factor in the Company achieving its 2004 results is the
quality of its assets. The quality of the loan portfolio has
allowed management to moderate the provision for possible credit
losses. The ratio of non-performing loan to total loans was just
0.03% at December 31, 2004 as compared to .21% at December 31, 2003
and the ratio of net loan losses to average loans was just 0.01%
for the full year 2004 as compared to .10% for the year of 2003.
The provision for loan losses was $675 thousand for the full year
2004 as compared to $1.2 million for the year of 2003. At December
31, 2004, the allowance for credit losses represented 1.02% of
loans outstanding, as compared to 1.16% at December 31, 2003. The
Company reported total assets at December 31, 2004 of $553 million
compared to $443 million at December 31, 2003, a 25% increase. At
December 31, 2004, total deposits amounted to $462 million,
representing a 38% increase over deposits of $336 million at
December 31, 2003, while total loans increased to $416 million at
December 31, 2004 from $318 million at December 31, 2003, a 31%
increase. "We are extremely pleased to report the strong
performance of Eagle Bancorp in 2004," noted both Leonard Abel,
Chairman and Ronald Paul, President and CEO of Eagle Bancorp, Inc.
"We take particular pride in the quality of assets managed by the
Company, which receives ongoing attention by management and the
Board. The strong loan growth experienced in the fourth quarter of
2004 is continuing in the first quarter of 2005 and should
contribute favorably to 2005 results." The Summary of Financial
Information presented on the following pages provides more detail
of the Company's performance for the year ended December 31, 2004
as compared to 2003. Persons wishing additional information should
refer to the Company's Form 10K report to be filed with the
Securities and Exchange Commission on or before March 15, 2005.
Non-GAAP Presentations. This press release refers to the efficiency
ratio which is computed by dividing noninterest expense by the sum
of net interest income on a tax equivalent basis and noninterest
income. This is a non-GAAP financial measure that we believe
provides investors with important information regarding our
operational efficiency. Comparison of our efficiency ratio with
those of other companies may not be possible because other
companies may calculate the efficiency ratio differently. The
Company, in referring to its net income, is referring to income
under accounting principles generally accepted in the United
States, or "GAAP." 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
and regarding general economic conditions. In some cases,
forward-looking statements can be identified by use of words such
as "may," "will," "anticipates," "believes," "expects," "plans,"
"estimates," "potential," "continue," "should," and similar words
or phrases. 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
discussion and the forward- looking statements are based, actual
future operations and results in the future 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. Eagle Bancorp, Inc. Statement of Condition Highlights
December September December (in thousands) 31, 2004 30, 2004 31,
2003 Unaudited Unaudited Audited Assets Cash and cash equivalents $
31,100 $ 50,116 $ 25,103 Interest bearing deposits with other banks
9,594 9,612 4,332 Federal funds sold 15,035 - - Investment
securities available for sale 64,098 65,696 82,581 Loans held for
sale 2,208 3,138 3,649 Loans 415,509 363,823 317,533 Less:
Allowance for credit losses (4,240) (4,176) (3,680) Loans, net
411,269 359,647 313,853 Other assets 19,979 19,479 13,479 Total
Assets $ 553,283 $ 507,688 $ 442,997 Liabilities and Stockholders'
Equity Non interest bearing deposits $ 130,309 $ 113,730 $90,468
Interest bearing deposits 331,978 297,291 245,046 Total deposits
462,287 411,021 335,514 Federal funds purchased and securities sold
under repurchase agreements 23,983 27,370 38,454 Other borrowings
6,333 11,443 14,588 Other liabilities 2,244 1,376 1,429 Total
liabilities 494,897 451,210 389,985 Stockholders' equity 58,436
56,478 53,012 Total Liabilities and Stockholders' Equity $ 553,283
$ 507,688 $ 442,997 Eagle Bancorp, Inc. Statements of Income
Highlights Twelve Months Ended Three Months Ended (in thousands)
December 31, December 31, 2004 2003 2004 2003 (Unaudited) (Audited)
(Unaudited)(Unaudited) Total interest income $ 24,195 $ 18,404 $
7,060 $ 5,044 Total interest expense 4,328 3,953 1,200 905 Net
interest income 19,867 14,451 5,860 4,139 Provision for credit
losses 675 1,175 218 445 Noninterest income 3,858 2,936 1,254 803
Noninterest expense 15,057 11,094 3,971 3,174 Income before incomes
taxes 7,993 5,118 2,925 1,323 Income tax expense 2,906 1,903 1,090
508 Net income $ 5,087 $ 3,215 $ 1,835 $ 815 Per Share Data:
Earnings per share, basic $ 0.94 $ 0.82 $ 0.34 $ 0.15 Earnings per
share, diluted 0.90 0.77 0.32 0.15 Shares outstanding at period end
5,421,730 5,359,303 5,421,730 5,359,303 Weighted average shares
outstanding, basic 5,403,616 3,932,004 5,412,785 5,356,379 Weighted
average shares outstanding, diluted 5,661,951 4,166,128 5,680,169
5,614,773 Book value per share at period end $ 10.78 $ 9.89 $ 10.78
$ 9.89 Eagle Bancorp, Inc. Financial Ratios and Average Balances
Years Ended December 31, Performance Ratios: 2004 2003 (annualized)
(Unaudited) (Audited) Return on average assets 1.04% 0.86% Return
on average equity 9.16% 9.45% Net interest margin 4.35% 4.14%
Efficiency ratio 64.00% 63.34% Other Ratios: Allowance for credit
losses to total loans 1.02% 1.16% Non performing loans to total
loans 0.03% 0.21% Net charge-offs (annualized) to average loans
0.01% 0.10% Average equity to average assets 11.38% 9.05% Tier 1
capital ratio 12.43% 15.30% Total capital ratio 13.33% 16.40%
Average Balances: Assets $ 487,853 $ 375,802 Earning assets $
455,979 $ 349,157 Loans $ 353,537 $ 266,811 Deposits $ 397,788 $
292,953 Stockholders' equity $ 55,507 $ 34,028 DATASOURCE: Eagle
Bancorp, Inc. CONTACT: Ronald D. Paul of Eagle Bancorp, Inc.,
+1-301-986-1800 Web site: http://www.eaglebankmd.com/
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