Freedom Bank Earns Record Pre-Tax Income of $1.9 Million in 2011

FAIRFAX, Va.--()--The Freedom Bank of Virginia (Bank) (Bulletin Board:FDVA.OB) earned a pre-tax net profit in 2011 of $1,900,300 ($0.80 per share), up from $1,821,514 in 2010 ($0.77 per share).

Freedom Bank took a tax benefit of $612,000 in 2010 that increased net profit after taxes to $2,433,514 in 2010. No benefits were taken for taxes in 2011. This is the second consecutive year of profit as well as the eleventh consecutive profitable quarter for the Bank.

Assets broke the $200 million level at $207,557,264 at 12/31/2011, up 21.1% from $171,350,118 at 12/31/2010. Gross loans increased to $157,414,693 at 12/31/2011, up 11.6% from $141,067,476 at 12/31/2011. Stockholder’s Equity increased to $23,697,402, up 9.8% from $21,575,018 at 12/31/2010. Book value per share was $10.03 per share at 12/31/2011, up from $9.15 the prior year. All were at record levels at 12/31/2011.

Primary drivers for the increased interest income were a $16,347,217 increase in loans and an $8,077,806 increase in investment securities held at 12/31/2011 versus the prior year.

At 12/31/2011 deposits in transaction accounts were $67,066,073, up 37% from $48,836,933 the prior year. Total deposits grew by 22.8% over year end levels for 2010.

CEO Craig S. Underhill said, “The Bank’s investment in new lending staff paid off in 2011 through improved loan growth. These same lenders also generated new deposit customers, resulting in significant increases in transaction account balances held by the Bank.”

Capital continues to be the strength of the Bank. Regulatory capital minimums to be considered well capitalized for Tier 1 Leverage Ratio, Risk Based Capital Tier 1, and Risk Based Capital Tier 2 were 5.0%, 6.0% and 10.0% respectively. At 12/31/2011 the ratios for the Bank were 12.85%, 14.44% and 14.52% respectively, all in the well capitalized category. This compares favorably to the 12/31/2010 levels of 12.49%, 14.85% and 14.91% respectively. The Bank continues its tradition of maintaining a strong capital base to serve the needs of its customers and stockholders.

Freedom Bank is a community-oriented, locally-owned bank with locations in Fairfax and Vienna, Virginia. For information about Freedom Bank’s deposit and loan services, visit the Bank’s website at www.freedombankva.com.

This release contains forward-looking statements, including our expectations with respect to future events that are subject to various risks and uncertainties. Factors that could cause actual results to differ materially from management's projections, forecasts, estimates and expectations include: fluctuation in market rates of interest and loan and deposit pricing, adverse changes in the overall national economy as well as adverse economic conditions in our specific market areas, maintenance and development of well-established and valued client relationships and referral source relationships, and acquisition or loss of key production personnel. Other risks that can affect the Bank are detailed from time to time in our quarterly and annual reports filed with the Board of Governors of the Federal Reserve System. We caution readers that the list of factors above is not exclusive. The forward-looking statements are made as of the date of this release, and we may not undertake steps to update the forward-looking statements to reflect the impact of any circumstances or events that arise after the date the forward-looking statements are made. In addition, our past results of operations are not necessarily indicative of future performance.

 
The Freedom Bank of Virginia
Statements of Financial Condition
(Unaudited)
 
 
    December 31, 2011     December 31, 2010
   
ASSETS
Assets:
Cash and due from banks $ 16,128,032 $ 3,441,325
Federal funds sold 15,753,000 17,212,000
Interest Bearing Balances with Banks 1,007,339 -
Investment securities available for sale, at fair value 15,183,798 5,767,655
Investment securities held to maturity 666,152 2,004,489
Federal Reserve Bank stock 689,350 615,600
Loans receivable 157,414,693 141,067,476
Allowance for possible loan losses   (2,037,164 )   (1,735,353 )
Net Loans 155,377,529 139,332,123
Bank Premises and equipment, net 213,857 315,774
Accrued interest and other receivables 519,450 517,293
Other assets 1,406,757 1,531,859
Deferred Tax Asset   612,000     612,000  
 
Total Assets $ 207,557,264   $ 171,350,118  
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits
Demand deposits:
Non-interest bearing deposits $ 25,392,303 $ 29,797,798
Interest Checking 41,673,770 19,039,135
Savings deposits 1,269,065 830,262
Time deposits   114,811,184     99,455,768  
Total Deposits 183,146,322 149,122,963
 
Other accrued expenses 654,898 580,902
Accrued interest payable   58,642     71,235  
Total Liabilities   183,859,862     149,775,100  
 
Stockholders' Equity

Common stock, $5 par value. (5,000,000 shares authorized: 2,363,665 shares issued and outstanding, December 31, 2011 2,357,361 shares issued and outstanding, December 31, 2010)

11,818,325 11,786,805
Additional paid-in capital 16,184,810 16,042,863
Accumulated other comprehensive income 134,776 86,159
Retained earnings (deficit)   (4,440,509 )   (6,340,809 )
 
Total Stockholders' Equity   23,697,402     21,575,018  
 
Total Liabilities and Stockholders' Equity $ 207,557,264   $ 171,350,118  
 
 
The Freedom Bank of Virginia
Statements of Operations
(Unaudited)
 
 
    For the three months ended     For the year ended
December 31, December 31,
2011     2010 2011     2010
Interest Income        
Interest and fees on loans $ 2,313,214 $ 2,170,347 $ 9,110,312 $ 8,730,192
Interest on investment securities 117,583 86,812 399,427 379,702
Interest on Federal funds sold   12,508   13,603     38,662   46,035  
Total Interest Income 2,443,305 2,270,762 9,548,401 9,155,929
 
Interest Expense
Interest on deposits   487,861   541,206     1,861,828   2,197,618  
 
Net Interest Income 1,955,444 1,729,556 7,686,573 6,958,311
 
Provision for Possible Loan Losses   15,000   -     348,000   200,000  
 
Net Interest Income after
Provision for Possible Loan Losses 1,940,444 1,729,556 7,338,573 6,758,311
 
Other Income
Service charges and other income 180,332 208,536 568,028 548,428
 
Operating Expenses
Officers and employee compensation and benefits 872,473 849,263 3,406,089 3,156,155
Occupancy expense 129,763 140,176 530,328 544,326
Equipment and depreciation expense 48,660 55,120 218,752 234,641
Insurance expense 41,579 73,908 241,878 332,217
Professional fees 207,101 106,727 398,568 101,590
Data and item processing 144,927 137,349 534,008 525,559
Business development 27,607 22,144 124,851 109,202
Franchise tax 48,840 52,871 202,955 202,136
Other operating expenses   119,884   60,371     348,872   279,399  
Total Operating Expenses   1,640,834   1,497,929     6,006,301   5,485,225  
 
Income before Income Taxes 479,942 440,163 1,900,300 1,821,514
Income Tax (Benefit) Expense   -   (612,000 )   -   (612,000 )
 
Net Income $ 479,942 $ 1,052,163   $ 1,900,300 $ 2,433,514  
 
Net Income Per Common Share $ 0.20 $ 0.45   $ 0.80 $ 1.03  
 
Net Income Per Diluted Share $ 0.20 $ 0.45   $ 0.80 $ 1.03  
 

Contacts

Freedom Bank of Virginia
Craig S. Underhill, Chief Executive Officer
703-242-5300

Release Summary

FREEDOM BANK EARNS RECORD PRE TAX INCOME OF $1.9 MILLION IN 2011

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Contacts

Freedom Bank of Virginia
Craig S. Underhill, Chief Executive Officer
703-242-5300