Access National Reports 50% Increase In First Quarter Earnings, Increases Dividend

Access National Corporation (NASDAQ: ANCX), parent company for Access National Bank, reported first quarter net income of $3.4 million, a 50.3% increase over the $2.3 million recorded in the first quarter of 2011. This represents the company’s 47 th consecutive quarterly profit over its 12 year history. Net income per dilutive common share was $0.33, an increase of 50.0% over the $0.22 reported in the first quarter of 2011.

Based on record earnings, strong capital and favorable outlook, the Board of Directors declared a cash dividend of $0.06 per share, representing the fifth increase over the last six quarters for holders of record as of May 2, 2012 and payable May 25, 2012.

During the first quarter of 2012 the Company experienced continued growth in earnings attributable to both core earnings from the banking segment and record earnings from the mortgage banking segment. Net interest margin for the first quarter of 2012 was 3.91%, up from 3.77% in the fourth quarter of 2011 and 3.55% in the first quarter of 2011.

Return on average assets annualized was 1.66% for the first quarter of 2012 compared to 1.61% for the fourth quarter of 2011 and 1.20% for the first quarter of 2011. Return on average equity annualized was 16.03% for the first quarter of 2012 compared to 15.87% for the fourth quarter of 2011 and 12.53% for the first quarter of 2011.

Loans held for investment totaled $573.3 million, compared to $569.4 million at December 31, 2011 and $497.5 million at March 31, 2011.

Total assets amounted to $804.8 million compared to $809.8 million at December 31, 2011. The decrease in assets was primarily attributable to the payoff of a $30.0 million senior unsecured note that was issued under the Temporary Liquidity Guarantee Program and was substantially offset by the increase in deposits.

Total deposits increased $22.2 million from $645.0 million at December 31, 2011 to $667.2 million at March 31, 2012. Demand deposits increased $23.0 million to $136.9 million from $113.9 million at December 31, 2011. Savings and interest-bearing deposits increased $11.4 million from December 31, 2011 and time deposits decreased $12.2 million from December 31, 2011. The overall increase in deposits allowed the Company to decrease its borrowings which, coupled with other factors, contributed to the increase in net interest margin.

Non-performing assets (NPA) at March 31, 2012 totaled $5.4 million or 0.66% of total assets, down from $6.7 million and 0.83% of total assets at December 31, 2011. The allowance for loan losses totaled $11.9 million or 2.08% of total loans held for investment and 223.2% of NPA as of March 31, 2012.

Book value per common share increased 16% to $8.37 at March 31, 2012 compared to $7.21 as of the March 31, 2011. The company remains “Well Capitalized” under banking regulations and poised for measured and responsible growth as the total equity to assets ratio was 10.64% at March 31, 2012.

Access National Corporation is the parent company of Access National Bank, an independent bank serving the business community of the DC Metropolitan area. Additional information is available at www.AccessNationalBank.com. Shares 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,
2012 2011 2011
(In Thousands)   (unaudited)       (unaudited)
 
ASSETS
 
Cash and due from banks $ 6,769 $ 5,362 9,308
 
Interest-bearing balances and federal funds sold 30,009 38,547 32,693
 
Investment securities:
Available-for-sale, at fair value 38,209 45,837 124,983
Held-to-maturity, at amortized cost (fair value of $64,802, $39,978 and $0) 64,950 39,987 -
Restricted Stock, at amortized cost   3,665   3,665   4,438  
Total investment securities 106,824 89,489 129,421
 
Loans held for sale - at fair value 75,552 95,126 33,689
 
Loans held for investment
net of allowance for loan losses of $11,941, $11,738
and $10,722, respectively 561,374 557,662 486,747
 
Premises, equipment and land 8,584 8,671 8,876
 
Other assets 15,643 14,901 16,464
     
Total assets $ 804,755 $ 809,758 $ 717,198  
 
LIABILITIES AND SHAREHOLDERS' EQUITY
 
LIABILITIES
Noninterest-bearing deposits $ 136,895 $ 113,885 87,597
 
Savings and interest-bearing deposits 193,396 182,005 148,485
 
Time deposits   336,934   349,123   260,077  
 
Total deposits 667,225 645,013 496,159
 
Short-term borrowings 32,343 59,904 127,053
 
Long-term borrowings 3,268 4,821 6,482
 
Subordinated debentures 6,186 6,186 6,186
 
Other liabilities and accrued expenses 10,126 11,019 6,846
     
Total Liabilities   719,148   726,943   642,726  
 
SHAREHOLDERS' EQUITY
Common stock $0.835 par value; 60,000,000 authorized;
issued and outstanding, 10,228,761, 10,192,649
and 10,330,508 shares, respectively 8,541 8,511 8,626
 
Additional paid in capital 16,613 16,716 17,572
 
Retained earnings 60,434 57,529 49,595
 
Accumulated other comprehensive income 19 59 (1,321 )
     
Total shareholders' equity   85,607   82,815   74,472  
     
Total liabilities and shareholders' equity $ 804,755 $ 809,758 $ 717,198  
                       

 
Access National Corporation
Consolidated Statement of Operations
               
  Three Months Ended
March 31, 2012   March 31, 2011
(In Thousands Except for Share and Per Share Data)   (unaudited)   (unaudited)
 
INTEREST INCOME
Interest and fees on loans 8,671 7,882
 
Interest on federal funds sold and bank balances 31 55
 
Interest on securities   649   633
Total interest income 9,351 8,570
 
INTEREST EXPENSE
Interest on deposits 1,273 1,511
 
Interest on other borrowings   210   492
Total interest expense   1,483   2,003
Net interest income 7,868 6,567
 
Provision for loan losses   718   223
Net interest income after provision for loan losses 7,150 6,344
 
NONINTEREST INCOME
Service charges and fees 177 173
 
Gain on sale of loans 10,944 5,516
 
Other Income   980   150
Total noninterest income 12,101 5,839
 
NONINTEREST EXPENSE
Salaries and benefits 8,335 5,393
 
Occupancy and equipment 651 665
 
Other operating expense   4,778   2,573
Total noninterest expense   13,764   8,631
Income before income tax 5,487 3,552
 
Income tax expense   2,050   1,265
NET INCOME   3,437   2,287
 
Earnings per common share:
Basic $ 0.34 $ 0.22
Diluted $ 0.33 $ 0.22
 
Average outstanding shares:
Basic 10,200,656 10,359,386
Diluted 10,312,845 10,404,677
               
 

             
Performance and Capital Ratios
                                 
Three Months Twelve Months Three Months Three Months Three Months Three Months Twelve Months
Ended Ended Ended Ended Ended Ended Ended

 

 

 

March 31,

December 31,

December 31,

September 30,

June 30,

March 31,

December 31,
(Dollars In Thousands)   2012   2011   2011   2011   2011   2011   2010
 
Return on average assets (annualized) 1.66 % 1.50 % 1.61 % 1.69 % 1.51 % 1.20 % 0.98 %
Return on average equity (annualized) 16.03 % 14.80 % 15.87 % 15.92 % 13.92 % 12.53 % 10.85 %
Net interest margin 3.91 % 3.82 % 3.77 % 4.02 % 4.00 % 3.55 % 3.41 %
Efficiency ratio - Bank only 52.17 % 52.92 % 53.85 % 52.38 % 53.06 % 52.32 % 59.02 %
Total equity to assets 10.64 % 10.23 % 10.23 % 10.47 % 10.91 % 10.38 % 8.68 %
 
Averages
Assets $ 827,438 $ 758,994 $ 822,190 $ 738,925 $ 707,859 $ 763,780 $ 772,600
Loans held for investment 568,351 520,062 549,245 527,258 508,010 494,920 475,726
Loans held for sale 79,575 51,774 91,962 49,641 29,347 29,021 63,868
Interest-bearing deposits & federal funds sold 50,471 58,128 73,338 50,509 28,575 80,250 86,531
Investment securities 106,487 105,964 80,584 90,258 118,506 135,281 107,685
Earning assets 804,884 735,929 795,129 717,666 684,439 739,472 733,810
Interest-bearing deposits 558,029 465,301 523,958 454,558 387,478 486,785 498,028
Total deposits 670,327 565,450 648,856 562,304 481,657 566,966 572,138
Repurchase agreements & federal funds sold 28,426 36,612 35,655 37,627 37,097 36,064 29,202
Commercial paper & other short term borrowings 1,203 59,220 30,326 34,338 93,625 66,637 38,088
Long-term borrowings 19,255 12,382 11,592 12,099 12,652 13,204 45,423
Equity $ 85,801 $ 76,969 $ 83,614 $ 78,212 $ 76,746 $ 72,988 $ 69,827
 
Banking segment - income before taxes $ 3,240 $ 13,972 $ 3,516 $ 2,982 $ 4,126 $ 3,348 $ 8,760
Mortgage segment - income before taxes $ 2,832 $ 6,358 $ 2,530 $ 2,369 $ 748 $ 711 $ 4,983
Other segments - income before taxes $ (585 ) $ (2,655 ) $ (888 ) $ (531 ) $ (729 ) $ (507 ) $ (1,641 )
Mortgage loan originations $ 257,295 $ 831,564 $ 279,681 $ 236,566 $ 175,905 $ 139,412 $ 908,959
Allowance for losses on mortgage loans sold $ 2,874 $ 2,616 $ 2,616 $ 2,395 $ 2,286 $ 2,113 $ 1,991
 
Book value per common share $ 8.37 $ 8.13 $ 8.13 $ 7.84 $ 7.56 $ 7.21 $ 6.96
                             
       
Composition of Loan Portfolio
                 
    March 31, 2012   December 31, 2011
(Dollars In Thousands)   Amount  

Percentage of Total
  Amount  

Percentage of Total
 
Commercial real estate - owner occupied $ 170,207 29.69 % $ 171,599 30.14 %
Commercial real estate - non-owner occupied 106,177 18.52 104,976 18.44
Residential real estate 128,509 22.42 128,485 22.56
Commercial 138,285 24.12 131,816 23.15
Real estate construction 26,816 4.68 29,705 5.22
Consumer   3,321   0.57     2,819   0.49  
Total loans $ 573,315 100.00 % $ 569,400 100.00 %
Less allowance for loan losses   11,941   11,738
$ 561,374 $ 557,662
                 

       
Composition of Deposits
                 
    March 31, 2012   December 31, 2011
(Dollars In Thousands)   Amount   Percentage of Total   Amount   Percentage of Total
 
Demand deposits $ 136,894 20.52 % $ 113,885 17.66 %
Interest-bearing demand deposits 62,997 9.44 59,798 9.27
Savings and money market 124,747 18.70 121,252 18.80
CDARS-reciprocal time deposits 177,259 26.57 192,326 29.82
Brokered deposits 34,760 5.20 31,228 4.84
Time deposits   130,568   19.57       126,524   19.61  
Total Deposits $ 667,225   100.00 %   $ 645,013   100.00 %
                 
           
Asset Quality Trend Profile
                         
Three Months Twelve Months Twelve Months Nine Months Six Months Three Months
Ended Ended Ended Ended Ended Ended
(Dollars In Thousands)   March 31, 2012   December 31, 2011   December 31, 2010   September 30, 2011   June 30, 2011   March 31, 2011
 
Total assets $ 804,755 $ 809,758 $ 831,824 $ 765,467 $ 713,016 $ 717,198
Total loans held for investment $ 573,315 $ 569,400 $ 491,529 $ 542,582 $ 520,674 $ 497,469
 
Allowance for loan losses - beginning balance $ 11,738 10,527 $ 9,127 $ 10,527 $ 10,527 $ 10,527
Charge offs (984 ) (1,232 ) (2,048 ) (944 ) (553 ) (184 )
Recoveries   469       1,295       632       1,019       862       156  
Net charge offs (515 ) 63 (1,416 ) 75 309 (28 )
Provision for loan losses   718       1,149       2,816       935       221       223  
Allowance for loan losses - ending balance $ 11,941       11,738     $ 10,527     $ 11,537     $ 11,057     $ 10,722  
 
Allowance for loan losses/loans held for investment 2.08 % 2.06 % 2.14 % 2.13 % 2.12 % 2.16 %
 
Delinquent 30 - 90 days $ - 271 $ 2,771 $ 4,226 $ 171 $ 2,100
Percentage of loans delinquent 0.00 % 0.05 % 0.56 % 0.78 % 0.03 % 0.42 %
 
Non-accrual loans $ 5,350 $ 6,703 $ 8,561 $ 7,077 $ 7,481 $ 9,163
OREO $ - $ - $ 1,859 $ 590 $ 590 $ 1,859
Total NPA $ 5,350 $ 6,703 $ 10,420 $ 7,667 $ 8,071 $ 11,022
NPA to total assets 0.66 % 0.83 % 1.25 % 1.00 % 1.13 % 1.53 %
Allowance for loan losses/NPA 223.20 % 175.12 % 101.03 % 150.48 % 137.00 % 97.28 %
 
OREO Expense $ 2 $ 523 $ 2,335 $ 420 $ 395 $ 68
Gain on Sale of OREO $ -     $ 1,452     $ 1,253     $ 1,325     $ 1,325     $ 15  
OREO expense net $ 2     $ (929 )   $ 1,082     $ (905 )   $ (930 )   $ 53  
 
Allowance for losses on mortgage loans sold $ 2,874 $ 2,616 $ 1,991 $ 2,395 $ 2,286 $ 2,113
Provision for losses on mortgage loans sold $ 258 $ 966 $ 3,836 $ 527 $ 289 $ 126
                         

 
Yield on Average Earning Assets and Rates on Average Interest-Bearing Liabilities
               
    Three Month Period Ended
    March 31, 2012 December 31, 2011 March 31, 2011
Average

Income /
Yield / Average Income / Yield / Average Income / Yield /
Balance   Expense   Rate Balance   Expense   Rate Balance   Expense   Rate
(Dollars In Thousands)
Assets:
Interest earning assets:
Securities, at amortized cost (1) $ 106,487 $ 649 2.44 % $ 80,584 $ 506 2.51 % $ 135,281 $ 633 1.87 %
Loans held for sale 79,575 850 4.27 % 91,962 894 3.89 % 29,021 349 4.81 %
Loans (2) 568,351 7,821 5.50 % 549,245 7,746 5.64 % 494,920 7,533 6.09 %
Interest-bearing balances and federal funds sold   50,471       31   0.25 %   73,338       46   0.25 %   80,250       55   0.27 %
Total interest earning assets 804,884 9,351 4.65 % 795,129 9,192 4.62 % 739,472 8,570 4.64 %
Non-interest earning assets:
Cash and due from banks 8,966 13,648 12,180
Premises, land, and equipment 8,641 8,715 8,927
Other assets 16,754 16,553 13,798
Less: allowance for loan losses   (11,807 )   (11,855 )   (10,597 )
Total non-interest earning assets   22,554     27,061     24,308  
Total Assets $ 827,438   $ 822,190   $ 763,780  
 
Liabilities and Shareholders' Equity:
Interest-bearing deposits:
Interest-bearing demand deposits $ 62,243 $ 51 0.33 % $ 73,529 $ 89 0.48 % $ 23,425 $ 27 0.46 %
Money market deposit accounts 130,362 146 0.45 % 105,739 132 0.50 % 124,176 194 0.62 %
Savings accounts 2,557 1 0.16 % 2,697 2 0.30 % 2,905 1 0.14 %
Time deposits   362,867       1,075   1.19 %   341,993       1,056   1.24 %   336,279       1,289   1.53 %
Total interest-bearing deposits 558,029 1,273 0.91 % 523,958 1,279 0.98 % 486,785 1,511 1.24 %
Borrowings:
FHLB Advances 1,203 4 1.33 % - - 0.00 % 4,523 15 1.33 %
Securities sold under agreements to repurchase and federal fund purchased 28,426 10 0.14 % 35,655 14 0.16 % 36,064 18 0.20 %
Other short-term borrowings - - 0.00 % - - 0.00 % 32,115 49 0.61 %
FHLB long-term borrowings 4,750 41 3.45 % 5,406 48 3.55 % 7,018 62 3.53 %
Senior unsecured term note 14,505 98 2.70 % 30,326 299 3.94 % 29,999 295 3.93 %
Subordinated Debentures   6,186       57   3.69 %   6,186       55   3.56 %   6,186       53   3.43 %
Total borrowings   55,070       210   1.53 %   77,573       416   2.15 %   115,905       492   1.70 %
Total interest-bearing liabilities   613,099       1,483   0.97 % 601,531 1,695 1.13 %   602,690       2,003   1.33 %
Noninterest-bearing liabilities:
Demand deposits 112,298 124,898 80,181
Other liabilities   16,240     12,147     7,921  
Total liabilities 741,637 738,576 690,792
Shareholders' Equity   85,801     83,614     72,988  
Total Liabilities and Shareholders' Equity: $ 827,438   $ 822,190   $ 763,780  
 
Interest spread (3) 3.68 % 3.50 % 3.31 %
 
Net interest margin (4) $ 7,868   3.91 % $ 7,497   3.77 % $ 6,567   3.55 %
                                     
 
(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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