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Virginia Commerce Bancorp, Inc. (the “Company”), (Nasdaq: VCBI), parent company of Virginia Commerce Bank (the “Bank”), today reported net income to common stockholders of $3.7 million, or $0.12 per diluted common share, for the first quarter of 2011, compared with net income to common stockholders of $3.2 million, or $0.11 per diluted common share, for the same period in 2010. A 20 basis point increase in the net interest margin, increased non-interest income and containment of non-interest expense drove the year-over-year improvement in earnings. However, earnings improvement was still constrained by the Company’s provisions for loan losses and an impairment loss in the Company’s securities portfolio.
Peter A. Converse, President and Chief Executive Officer, commented, “Our first quarter results are a good start to the year. Our strong core operating earnings continued to benefit from sequential increases in the net interest margin and expense containment discipline, while asset quality metrics were fairly positive across the board. Although credit costs as well as a securities impairment loss had a dampening effect on the flow of core earnings to the bottom line, it is anticipated that these expenses, especially loan loss provisioning, will have less of an impact as the year progresses and we continue to reduce our non-performing asset exposure.”
“For this just completed quarter, non-performing assets and loans 90+ days past due showed modest improvement, declining by just over $1 million. However, Troubled Debt Restructurings declined by $11.1 million, from $103.0 million to $91.9 million, the second consecutive quarterly decrease in this category. Loans 30 – 89 days past due were $10.4 million as of March 31, 2011, having declined sequentially and year-over-year from $11.6 million and $13.5 million respectively. We expect that meaningful progress in reducing problem assets will be made through the remainder of the year, without necessarily incurring the same quarterly levels of provisioning and charge-offs as experienced in the first quarter.”