Access National Corporation (NASDAQ: ANCX), parent company for Access National Bank, reported first quarter net income of $2.3 million, a 88.1% increase over the $1.2 million recorded in the first quarter of 2010. This represents the company’s 43 rd consecutive quarterly profit. Net income per diluted common share was $0.22, an increase of 100.0% over the $0.11 reported in the first quarter of 2010.

The Board of Directors also declared a cash dividend of $0.03 per share for shareholders of record as of May 5, 2011 and payable on May 25, 2011. The dividend represents a $0.01 increase over the per share dividend paid in the prior quarter on February 25, 2011.

Income before taxes from the banking segment increased 129% to $3.3 million for the first quarter of 2011 compared to $1.5 million for the first quarter 2010. The banking segment contributed 94% of consolidated earnings in the first quarter of 2011 compared to a contribution rate of 77% in the first quarter of 2010. In the first quarter 2011, the mortgage segment contributed $711 thousand in pre-tax earnings on mortgage origination volume of $122 million compared to a contribution of $778 thousand on origination volume of $149 million in the first quarter of 2010.

Return on average assets was 1.20% for the first quarter of 2011 compared to 0.74% for the first quarter of 2010. Return on average equity was 12.53% for the quarter ended March 31, 2011 compared to 7.01% for the same period last year. Book value per common share was $7.21 at March 31, 2011 compared to $6.52 at March 31, 2010, an increase of 10.6%.

Assets totaled $717.2 million at March 31, 2011 compared to $831.8 at December 31, 2010, a decrease of $114.6 million. The decrease in assets occurred in loans held for sale and interest-bearing balances and federal funds sold, indirectly a result of a 54% quarter over quarter reduction in mortgage origination volume.

Deposits totaled $496.2 million at March 31, 2011 compared to $627.8 million at December 31, 2010. In spite of a $4 million increase in Demand Deposits during the quarter ended March 31, 2011, overall deposits declined due to a deliberate reduction in brokered and CDAR deposits. The redemption of brokered and CDAR deposits consumed cash proceeds from interest-bearing balances and Loans Held for Sale.

Non-performing assets (NPAs, including Troubled Debt Restructurings or TDRs) totaled approximately $11.0 million or 1.53% of assets at March 31, 2011, compared to $10.4 million or 1.25% of assets at December 31, 2010. NPAs are comprised of non-accrual loans totaling $9.1 million and other real estate owned of $1.9 million. The allowance for loan losses totaled $10.7 million or 2.16% of total loans held for investment as of March 31, 2011.

Access National Corporation and its subsidiary bank continue to exceed standards of being “Well Capitalized” as defined under banking regulations. The ratio of total equity to total assets at March 31, 2011 was 10.38%.

Access National Corporation is the parent company of Access National Bank, an independent, nationally chartered bank serving the business community of the greater DC Metropolitan area. Additional information is available on our website at www.AccessNationalBank.com. Shares of Access National Corporation are traded on the NASDAQ Global Market under the symbol "ANCX".

This press release contains “forward-looking statements” within the meaning of the federal securities laws. These statements may be identified as “may”, “could”, “expect”, “believe”, anticipate”, “intend”, “plan” or variations thereof. These forward-looking statements may contain information related to those matters such as the Company’s intent, belief, or expectation with respect to matters such as financial performance. Such statements are necessarily based on assumptions and estimates and are inherently subject to a variety of risks and uncertainties concerning the Company’s operations and business environment, which are difficult to predict and beyond control of the company. Such risks and uncertainties could cause the actual results of the Company to differ materially from those matters expressed or implied in such forward-looking statements. For an explanation of certain risks and uncertainties associated with forward-looking statements, please refer to the Company’s Annual Report on Form 10-K and other SEC filings.
 
Access National Corporation
Consolidated Balance Sheet
             
  March 31,   December 31,   March 31,
(In Thousands)     2011       2010       2010  
 
ASSETS
 
Cash and due from banks $ 9,308 $ 9,198 $ 4,346
 
Interest-bearing balances and federal funds sold 32,693 102,709 14,651
 
Securities available for sale - at fair value 129,421 128,745 77,687
 
Loans held for sale - at fair value 33,689 82,244 49,705
 

Loans held for investment net of allowance for loan losses of $10,722, $10,527 and $9,256, respectively
486,747 481,002 460,472
 
Premises, equipment and land 8,876 8,934 8,694
 
Other assets 16,464 18,992 21,826
     
Total assets $ 717,198   $ 831,824   $ 637,381  
 
LIABILITIES AND SHAREHOLDERS' EQUITY
 
LIABILITIES
Noninterest-bearing deposits $ 87,597 $ 83,972 $ 68,058
 
Savings and interest-bearing deposits 148,485 158,352 154,087
 
Time deposits   260,077     385,524     238,055  
 
Total deposits 496,159 627,848 460,200
 
Short-term borrowings 127,053 80,348 52,923
 
Long-term borrowings 6,482 37,034 40,360
 
Subordinated debentures 6,186 6,186 6,186
 
Other liabilities and accrued expenses 6,846 8,215 8,495
     
Total Liabilities   642,726     759,631     568,164  
 
SHAREHOLDERS' EQUITY

Common stock $0.835 par value; 60,000,000 authorized; issued and outstanding, 10,330,508, 10,376,169 and 10,615,313 shares, respectively
8,626 8,664 8,864
 
Surplus 17,572 17,794 18,931
 
Retained earnings 49,595 47,530 41,487
 
Accumulated other comprehensive income (1,321 ) (1,795 ) (65 )
     
Total shareholders' equity   74,472     72,193     69,217  
     
Total liabilities and shareholders' equity $ 717,198   $ 831,824   $ 637,381  
                         

 
Access National Corporation
Consolidated Statement of Operations
             
  Three Months Ended
March 31, 2011   December 31, 2010   March 31, 2010
(In Thousands Except for Share Data)   (unaudited)        
 
INTEREST INCOME
Interest and fees on loans $ 7,882 $ 8,652 $ 7,872
 
Interest on federal funds sold and bank balances 55 38 37
 
Interest on securities   633   705   350
Total interest income 8,570 9,395 8,259
 
INTEREST EXPENSE
Interest on deposits 1,511 1,728 1,968
 
Interest on other borrowings   492   569   706
Total interest expense   2,003   2,297   2,674
Net interest income 6,567 7,098 5,585
 
Provision for loan losses   223   1,495   198
Net interest income after provision for loan losses 6,344 5,603 5,387
 
NONINTEREST INCOME
Service charges and fees 173 176 160
 
Gain on sale of loans 5,516 8,406 5,240
 
Other Income   150   2,368   623
Total noninterest income 5,839 10,950 6,023
 
NONINTEREST EXPENSE
Salaries and benefits 5,393 5,452 5,252
 
Occupancy and equipment 665 663 684
 
Other operating expense   2,573   6,842   3,567
Total noninterest expense   8,631   12,957   9,503
Income before income tax 3,552 3,596 1,907
 
Income tax expense   1,265   1,350   691
NET INCOME $ 2,287 $ 2,246 $ 1,216
 
Earnings per common share:
Basic $ 0.22 $ 0.22 $ 0.12
Diluted $ 0.22 $ 0.22 $ 0.11
 
Average outstanding shares:
Basic 10,359,386 10,393,762 10,572,017
Diluted 10,404,677 10,423,668 10,589,506
             

             
Performance and Capital Ratios
                             
Three Months Three Months Three Months Three Months Three Months Twelve Months Twelve Months
Ended Ended Ended Ended Ended Ended Ended
March 31, December 31, September 30, June 30, March 31,

December 31,
December 31,
(Dollars In Thousands)     2011       2010       2010       2010       2010       2010       2009  
 
Return on average assets (annualized) 1.20 % 1.08 % 1.21 % 0.84 % 0.74 % 0.98 % 1.35 %
Return on average equity (annualized) 12.53 % 12.60 % 13.87 % 9.24 % 7.01 % 10.85 % 15.04 %
Net interest margin 3.55 % 3.57 % 3.36 % 3.16 % 3.58 % 3.41 % 3.42 %
Efficiency ratio - Bank only 52.32 % 54.98 % 58.64 % 53.39 % 71.71 % 59.02 % 60.41 %
Total equity to assets 10.38 % 8.68 % 9.03 % 8.91 % 10.86 % 8.68 % 10.16 %
 
Averages
Assets $ 763,780 $ 834,973 $ 802,357 $ 798,037 $ 654,622 $ 772,600 $ 714,970
Loans held for investment 494,920 485,710 471,308 469,122 476,713 475,726 490,393
Loans held for sale 29,021 107,474 70,913 44,984 31,528 63,868 65,780
Interest-bearing deposits & federal funds sold 80,249 66,377 88,014 128,864 62,813 86,531 64,128
Investment securities 132,873 135,468 127,913 114,061 53,193 107,940 69,758
Earning assets 739,472 794,855 757,702 756,754 624,128 733,810 689,153
Interest-bearing deposits 486,785 529,413 528,590 531,442 400,918 498,028 441,199
Total deposits 566,966 611,255 603,460 604,851 468,208 572,138 519,477
Repurchase agreements & federal funds sold 36,064 38,620 28,376 25,307 24,356 29,202 23,460
Commercial paper & other short term borrowings 66,637 50,402 34,653 34,365 32,775 38,088 41,316
Long-term borrowings 13,204 43,757 44,311 44,864 48,828 45,423 56,839
Equity 72,988 71,333 70,272 70,112 69,386 69,827 64,054
 
Banking segment - income before taxes $ 3,348 $ 2,285 $ 2,428 $ 2,586 $ 1,461 $ 8,760 $ 4,225
Mortgage segment - income before taxes $ 711 $ 1,691 $ 1,939 $ 575 $ 778 $ 4,983 $ 12,579
Other segments - income before taxes $ (507 ) $ (380 ) $ (442 ) $ (487 ) $ (332 ) $ (1,641 ) $ (1,315 )
Mortgage loan originations $ 122,215 $ 263,629 $ 231,804 $ 180,365 $ 148,941 $ 824,738 $ 1,517,397
Allowance for losses on mortgage loans sold $ 2,113 $ 1,991 $ 4,488 $ 3,630 $ 3,768 $ 1,991 $ 3,332
 
Book value per common share $ 7.21 $ 6.96 $ 6.95 $ 6.71 $ 6.52 $ 6.96 $ 6.43
                             
           
Asset Quality Trend Profile
                         
Three Months Twelve Months Nine Months Six Months Three Months Twelve Months
Ended Ended Ended Ended Ended Ended
(Dollars In Thousands)   March 31, 2011   December 31, 2010   September 30, 2010   June 30, 2010   March 31, 2010   December 31, 2009
 
Total assets $ 717,198 $ 831,824 $ 804,838 $ 790,570 $ 637,381 $ 666,879
Total loans held for investment $ 497,469 $ 491,529 $ 478,327 $ 468,883 $ 469,728 $ 486,564
 
Allowance for loan losses - beginning balance $ 10,527 $ 9,127 $ 9,127 $ 9,127 $ 9,127 $ 7,462
Charge offs (184 ) (2,048 ) (1,231 ) (974 ) (393 ) (5,310 )
Recoveries   156       632       505       449       324       911  
Net charge offs (28 ) (1,416 ) (726 ) (525 ) (69 ) (4,399 )
Provision for loan losses   223       2,816       1,321       746       198       6,064  
Allowance for loan losses - ending balance $ 10,722     $ 10,527     $ 9,722     $ 9,348     $ 9,256     $ 9,127  
 
Allowance for loan losses/loans held for investment 2.16 % 2.14 % 2.03 % 1.99 % 1.97 % 1.88 %
 
Delinquent 30 - 90 days $ 2,100 $ 2,771 $ 840 $ 358 $ 845 $ 1,267
Percentage of loans delinquent 0.42 % 0.56 % 0.18 % 0.08 % 0.18 % 0.26 %
 
Non-accrual loans $ 9,163 $ 8,561 $ 6,952 $ 6,752 $ 9,447 $ 7,032
OREO $ 1,859 $ 1,859 $ 3,276 $ 5,334 $ 4,073 $ 5,111
Total NPA $ 11,022 $ 10,420 $ 10,228 $ 12,086 $ 13,520 $ 12,143
NPA to total assets 1.53 % 1.25 % 1.27 % 1.53 % 2.12 % 1.82 %
Allowance for loan losses/NPA 97.28 % 101.03 % 95.06 % 77.35 % 68.47 % 75.16 %
 
OREO Expense $ 68 $ 2,335 $ 1,324 $ 676 $ 459 $ 1,497
Gain on Sale of OREO $ 15     $ 1,253     $ 349     $ -     $ (98 )   $ -  
OREO expense net $ 53     $ 1,082     $ 975     $ 676     $ 557     $ 1,497  
 
Allowance for losses on mortgage loans sold $ 2,113 $ 1,991 $ 4,488 $ 3,630 $ 3,768 $ 3,332
Provision for losses on mortgage loans sold $ 126 $ 3,836 $ 2,400 $ 1,100 $ 500 $ 5,050
                                                 

                       
Composition of Loan Portfolio
                                     
      March 31, 2011     December 31, 2010     March 31, 2010
(Dollars In Thousands)     Amount    

Percentage of Total
    Amount    

Percentage of Total
    Amount    

Percentage of Total
 
Commercial real estate $ 216,145 43.45 % $ 218,013 44.35 % $ 215,969 45.98 %
Residential real estate 133,302 26.80 137,771 28.03 140,195 29.85
Commercial 109,046 21.92 94,765 19.28 72,193 15.37
Real estate construction 36,303 7.30 38,093 7.75 39,910 8.50
Consumer   2,673     0.53     2,887     0.59     1,461     0.30  
Total loans $ 497,469 100.00 % $ 491,529 100.00 % $ 469,728 100.00 %
Less allowance for loan losses   10,722   10,527   9,256
$ 486,747 $ 481,002 $ 460,472
                                     
                       
Composition of Deposits
                                     
      March 31, 2011     December 31, 2010     March 31, 2010
(Dollars In Thousands)     Amount    

Percentage of Total
    Amount    

Percentage of Total
    Amount    

Percentage of Total
 
Demand deposits $ 87,597 17.66 % $ 83,972 13.37 % $ 68,058 14.79 %
Interest-bearing demand deposits 21,459 4.32 24,548 3.91 28,378 6.17
Savings and money market 127,026 25.60 110,967 17.67 100,688 21.88
CDARS-reciprocal time deposits 132,115 26.63 234,221 37.31 81,881 17.79
Brokered deposits 13,425 2.71 56,356 8.98 76,570 16.64
Time deposits   114,537     23.08         117,784     18.76         104,625     22.73  
Total Deposits $ 496,159     100.00 %     $ 627,848     100.00 %     $ 460,200     100.00 %
                                     

 
Yield on Average Earning Assets and Rates on Average Interest-Bearing Liabilities
               
    Three Month Period Ended
    March 31, 2011   December 31, 2010   March 31, 2010
    Average Balance   Income / Expense   Yield / Rate   Average Balance   Income / Expense   Yield / Rate   Average Balance   Income / Expense   Yield / Rate
(Dollars In Thousands)
Assets:
Interest earning assets:
Securities, at amortized cost (1) $ 135,281 $ 633 1.87 % $ 135,294 $ 705 2.08 % $ 53,073 $ 350 2.64 %
Loans held for sale 29,021 349 4.81 % 107,474 1,181 4.40 % 31,528 389 4.94 %
Loans (2) 494,920 7,533 6.09 % 485,710 7,471 6.15 % 476,713 7,483 6.28 %
Interest-bearing balances and federal funds sold   80,250       55   0.27 %   66,377       38   0.23 %   62,813       37   0.24 %
Total interest earning assets 739,472 8,570 4.64 % 794,855 9,395 4.73 % 624,127 8,259 5.29 %
Non-interest earning assets:
Cash and due from banks 12,180 14,715 7,205
Premises, land, and equipment 8,927 8,610 8,731
Other assets 13,798 26,673 23,930
Less: allowance for loan losses   (10,597 )   (9,880 )   (9,371 )
Total noninterest earning assets   24,308     40,118     30,495  
Total Assets $ 763,780   $ 834,973   $ 654,622  
 
Liabilities and Shareholders' Equity:
Interest-bearing deposits:
Interest-bearing demand deposits $ 23,425 $ 27 0.46 % $ 25,394 $ 34 0.54 % $ 23,484 $ 43 0.73 %
Money market deposit accounts 124,176 194 0.62 % 134,918 241 0.71 % 129,783 393 1.21 %
Savings accounts 2,905 1 0.14 % 3,820 3 0.31 % 4,135 10 0.97 %
Time deposits   336,279       1,289   1.53 %   365,281       1,450   1.59 %   243,516       1,522   2.50 %
Total interest-bearing deposits 486,785 1,511 1.24 % 529,413 1,728 1.31 % 400,918 1,968 1.96 %
Borrowings:
FHLB Advances 4,523 15 1.33 % 8,220 45 2.19 % 17,708 203 4.59 %
Securities sold under agreements to repurchase and federal fund purchased 36,064 18 0.20 % 38,620 24 0.25 % 24,356 28 0.46 %
Other short-term borrowings 32,115 49 0.61 % 42,182 79 0.75 % 15,067 34 0.90 %
FHLB long-term borrowings 7,018 62 3.53 % 7,572 69 3.65 % 12,645 94 2.97 %
FDIC term note 29,999 295 3.93 % 29,998 299 3.99 % 29,997 295 3.93 %
Subordinated Debentures   6,186       53   3.43 %   6,186       53   3.43 %   6,186       52   3.36 %
Total borrowings   115,905       492   1.70 %   132,778       569   1.71 %   105,959       706   2.67 %
Total interest-bearing liabilities   602,690       2,003   1.33 %   662,191       2,297   1.39 %   506,877       2,674   2.11 %
Noninterest-bearing liabilities:
Demand deposits 80,181 81,842 67,291
Other liabilities   7,921     19,607     11,068  
Total Liabilities 690,792 763,640 585,236
Shareholders' Equity   72,988     71,333     69,386  
Total Liabilities and Shareholders' Equity: $ 763,780   $ 834,973   $ 654,622  
 
Interest spread (3) 3.31 % 3.34 % 3.18 %
 
Net interest margin (4) $ 6,567   3.55 % $ 7,098   3.57 % $ 5,585   3.58 %
                                     
 
(1) Includes restricted stock.
(2) Loans placed on nonaccrual status are included in loan balances.

(3) Interest spread is the average yield earned on earning assets, less the average rate incurred on interest-bearing liabilities.

(4) Net interest margin is net interest income, expressed as a percentage of average earning assets.
 

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