Freedom Bank Announces 2012 Third Quarter Earnings

FAIRFAX, Va.--()--The Freedom Bank of Virginia (Bank) (Bulletin Board: FDVA.OB) earned a Net Profit Before Taxes of $452,617 for the quarter ending September 30, 2012, its fourteenth consecutive quarterly profit. Net Profit for the quarter ended September 30, 2011 was $618,321. Net Profit Before Taxes was $1,013,472 for the first nine months of 2012 compared to a Net Profit for the first nine months of 2011 of $1,420,358. The reduction in profit in 2012 versus 2011 was principally due to an increase in the provision for loan losses as well as expenses associated with hiring additional commercial lenders in the third quarter.

Financial Highlights

  • Total assets increased from $200,913,660 at September 30, 2011 to $218,243,386 at September 30, 2012.
  • Investment Securities Available for Sale increased from $11,325,335 at September 30, 2011 to $30,631,566 at September 30, 2012.
  • Loans Receivable increased from $148,612,798 at September 30, 2011 to $157,209,916 at September 30, 2012.
  • Asset quality remains strong with non performing assets decreasing to 1.05% of total assets at September 30, 2012, down from 1.95% at September 30, 2011.
  • Non Interest Bearing Deposits increased $6,646,676 (20.92%) to $38,420,474 between September 30, 2011 and September 30, 2012.
  • Total deposits increased $15,247,247 (8.59%) to $193,356,884 between September 30, 2011 and September 30, 2012.
  • Total capital increased $1,909,639 (8.31%) over the past year to $24,886,502 at September 30, 2012, up from $22,976,660 at September 30, 2011.
  • Capital continues to be the strength of the Bank. Regulatory capital minimums 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 September 30, 2012 the ratios for the Bank were 11.51%, 14.67%% and 15.92%% respectively, all in the well capitalized category.

According to CEO Craig Underhill, “The Bank continues to grow and be profitable despite the challenging economy. The Bank hired two additional commercial bankers during the third quarter as part of its growth plan. Subsequent to the end of the quarter, Freedom Bank also hired Kevin Curtis, Executive Vice President Corporate Banking, to accelerate future commercial loan growth.”

In 2012 the Bank made a decision to deregister its shares under the Jumpstart Our Business Startups Act (JOBS). The Bank filed its application on June 26, 2012 and deregistration became effective September 26, 2012. The Bank’s requirement to file reports with the Federal Reserve including forms 10-K, 10-Q and 8-K has been suspended. However, the Bank will continue to provide quarterly press releases of financial performance and to post annual and quarterly financial reports on our website at www.freedombankva.com. As part of our effort to be more environmentally responsible, we will now mail out quarterly reports only upon request.

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
 
September 30, 2012   September 30, 2011
ASSETS
Cash and due from banks $ 3,837,765 $ 18,072,108
Federal funds sold 19,780,000 18,742,000
Interest bearing balances with banks 1,014,986 1,004,071
Investment securities available for sale, at fair value 30,631,566 11,325,335
Investment securities held to maturity 403,670 765,578
Federal Reserve Bank stock 732,300 675,400
Loans held for sale 1,864,850 925,300
Loans receivable 157,209,916 148,612,798
Allowance for possible loan losses   (2,136,821 )   (2,021,135 )
Net Loans 155,073,095 146,591,663
Premises and equipment, net 207,380 234,041
Accrued interest and other receivables 660,303 440,886
Other assets 3,425,471 1,525,278
Deferred tax asset   612,000     612,000  
 
Total Assets $ 218,243,386   $ 200,913,660  
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Demand deposits:
Non-interest bearing deposits 38,420,474 31,773,798
Interest Checking 33,848,447 38,848,386
Savings deposits 1,525,117 1,161,586
Time deposits   118,858,773     105,621,794  
Total Deposits 192,652,811 177,405,564
 
Other accrued expenses 633,388 471,848
Accrued interest payable   70,685     59,385  
Total Liabilities   193,356,884     177,936,797  
 
Stockholders' Equity

Common stock, $4.17 par value. (5,000,000 shares authorized: issued and outstanding 2,856,117 shares for September 30, 2012 and 2,836,398 shares for September 30, 2011)

11,858,828 11,818,325
Additional paid-in capital 16,247,703 16,046,069
Accumulated other comprehensive income 207,009 32,920
Retained earnings (deficit)   (3,427,038 )   (4,920,451 )
 
Total Stockholders' Equity   24,886,502     22,976,863  
 
Total Liabilities and Stockholders' Equity $ 218,243,386   $ 200,913,660  
       
The Freedom Bank of Virginia
Statements of Operations
UNAUDITED
 
For the three months ended For the nine months ended
September 30, September 30,
2012   2011 2012   2011
 
Interest Income
Interest and fees on loans $ 2,323,266 $ 2,235,785 $ 6,939,300 $ 6,797,098
Interest on investment securities 148,077 107,714 462,118 281,844
Interest on Federal funds sold   5,767   8,321   31,390   26,154
Total Interest Income 2,477,110 2,351,820 7,432,808 7,105,096
 
Interest Expense
Interest on deposits   486,584   441,208   1,524,676   1,373,967
 
Net Interest Income 1,990,526 1,910,612 5,908,132 5,731,129
 
Provision for Possible Loan Losses   17,200   20,000   588,200   333,000
 
Net Interest Income after
Provision for Possible Loan Losses 1,973,326 1,890,612 5,319,932 5,398,129
 
Other Income
Service charges and other income 268,629 199,542 688,632 387,696
 
Operating Expenses
Officers and employee compensation and benefits 1,083,321 856,012 2,952,054 2,533,616
Occupancy expense 126,549 130,926 386,478 400,565
Equipment and depreciation expense 41,799 52,212 138,168 170,092
Insurance expense 43,588 62,185 129,168 200,299
Professional fees 142,581 68,119 369,574 191,467
Data and item processing 149,254 137,717 453,152 389,081
Business development 31,224 32,429 97,334 97,244
Franchise tax 59,662 48,840 166,449 154,115
Other operating expenses   111,360   83,393   302,715   228,988
Total Operating Expenses   1,789,338   1,471,833   4,995,092   4,365,467
 
Income before Income Taxes 452,617 618,321 1,013,472 1,420,358
Provision for Income Taxes   -   -   -   -
 
Net Income $ 452,617 $ 618,321 $ 1,013,472 $ 1,420,358
 
Net Income Per Common Share $ 0.16 $ 0.22 $ 0.36 $ 0.50
 
Net Income Per Diluted Share $ 0.16 $ 0.22 $ 0.36 $ 0.28
 

Contacts

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

Release Summary

Freedom Bank Announces 2012 Third Quarter Earnings

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Contacts

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