Freedom Bank Announces 2012 Third Quarter Earnings

Freedom Bank Announces 2012 Third Quarter Earnings

FAIRFAX, Va.--(BUSINESS WIRE)-- 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



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

KEYWORDS: United States North America Virginia

INDUSTRY KEYWORDS:

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