Hamilton Bancorp, Inc. Reports Results For The First Fiscal Quarter Ended June 30, 2014

Hamilton Bancorp, Inc. (the “Company”) (Nasdaq: HBK), today reported a net loss of $192,000, or $(0.06) per share (basic and diluted), for the quarter ended June 30, 2014, compared to net income of $18,000, or $0.01 per share (basic and diluted) for the quarter ended June 30, 2013. A large portion of the loss for the first quarter of fiscal 2015 compared to the same quarter last year is attributable to the decrease in interest revenue due to a reduction in the average balance of net loans, as well as an increase in noninterest expenses resulting from the hiring of new personnel within the lending areas. The new staff enables the Bank to bring its commercial loan underwriting in-house versus using an outside third party and allows us to document and monitor our loans more closely. Management feels this has given us more oversight and control around the lending process.

Management continues to work through problem assets decreasing nonaccrual loans by $449,000, or 10.6% to $3.8 million at June 30, 2014 compared to $4.2 million at March 31, 2014. The decrease in nonaccrual loans includes $39,000 in net charge-offs and $281,000 as a result of loan payments, including a $186,000 loan pay-off from the Small Business Administration (SBA) for their loan guarantee on a commercial loan.

Balance Sheet Review

Total assets at June 30, 2014 decreased $2.0 million, or 0.7%, to $300.8 million from $302.8 million at March 31, 2014. The decrease in assets is primarily attributable to an $8.0 million decrease in cash and cash equivalents, partially offset by increases of $4.4 million and $2.0 million within the investment and loan portfolios, respectively.

Net loans increased $2.0 million to $144.9 million at June 30, 2014 from $142.9 million at March 31, 2014. The Bank had several large commercial loan relationships totaling nearly $5.4 million that paid off during the current quarter and refinanced with other financial institutions. The Bank was able to replace those commercial loans with nearly $9.7 million in new commercial loan originations, increasing net commercial loans by $3.7 million in the first quarter of fiscal 2015 to $63.6 million or 43.3% of gross loans compared to $59.9 million or 41.4% of gross loans at March 31, 2014. Residential one- to four-family loans decreased $1.3 million as these loans paid down, repaid or refinanced and newly originated residential loans were sold in the secondary market at a premium to reduce interest rate risk. The Bank continues to focus on transforming the composition of its loan portfolio by emphasizing more commercial and commercial real estate lending versus one- to four-family residential mortgages.

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