Glen Burnie Bancorp Announces Fourth Quarter and Full Year 2024 Results

GLEN BURNIE, Md., Feb. 06, 2025 (GLOBE NEWSWIRE) -- Glen Burnie Bancorp (“Bancorp”) (NASDAQ: GLBZ), the bank holding company for The Bank of Glen Burnie (“Bank”), announced today net loss of $39,000, or -$0.01 per basic and diluted common share, for the three-month period ended December 31, 2024, compared to net income of $167,000, or $0.06 per basic and diluted common share, for the three-month period ended December 31, 2023. Bancorp reported a net loss of $112,000, or -$0.04 per basic and diluted common share, for the twelve-month period ended December 31, 2024, compared to net income of $1.4 million, or $0.50 per basic and diluted common share, for the same period in 2023. On December 31, 2024, Bancorp had total assets of $358.9 million. Bancorp is the oldest independent commercial bank in Anne Arundel County. “Our financial performance in 2024 is disappointing and represents the challenges inherent in navigating the interest rate environment of the last several years. The Company’s focus on generating additional interest-earning assets at higher current market interest rates and rebuilding our base of core, low-cost deposits was moderately successful,” said Mark C. Hanna, President, and Chief Executive Officer. “Despite the challenges of declining net interest income, the Company’s financial strength is reflected in a strong capital position, available liquidity, and prudent expense management. Although interest expense increased significantly in year over year comparisons, loan growth of $28.9 million and higher yields on earning assets contributed to expanded interest income that partially offset higher interest expense and helped mitigate margin compression.” In closing, Mr. Hanna added, “To invest in strategic opportunities that will benefit the long-term performance of the Bank, the difficult decision was made to change the longstanding practice of approving quarterly cash dividends for shareholders. As the Bank evaluates our next 75 years, we are committed to our business model and the economic strength of the communities we serve. To better serve the evolving needs of our clients, there is a need to reinvest in our people, technology, products, and facilities. Based on our capital levels, conservative underwriting policies, on- and off-balance sheet liquidity, strong loan diversification, and current economic conditions within the markets we serve, management expects to navigate the uncertainties and remain well-capitalized. Our focus remains continued execution on our strategic priorities to generate organic loan and deposit growth.” Highlights for the Quarter and Year ended December 31, 2024 Despite growth in loans and deposits for the twelve-month period ending December 31, 2024, net interest income decreased $1.2 million, or 9.84% to $10.9 million through December 31, 2024, as compared to $12.1 million during the same period of 2023. The decrease resulted primarily from a $3.1 million increase in interest expenses, offset by a $1.9 million increase in interest and fees on loans. The $2.0 million increase in interest on deposits was driven by the higher cost of money market deposit balances. The $1.0 million increase in interest on borrowings was driven by a $20.1 million increase in the average balance of borrowed funds due to the elevated level of deposit runoff that occurred in 2023. Total interest income increased $1.9 million to $15.2 million for the twelve-month period ending December 31, 2024, compared to the same period in 2023 as the result of a $1.9 million increase in interest and fees on loans. The increase in interest income was driven by rate adjustments on loans offerings consistent with the higher interest rate environment. However, loan pricing pressure/competition will continue to place pressure on the Company’s net interest margin. The Company expects that its strong liquidity and capital positions, along with the Bank’s total regulatory capital to risk weighted assets of 16.40% on December 31, 2024, compared to 18.40% for the same period of 2023, will provide ample capacity for future growth. Return on average assets for the three-month period ended December 31, 2024, was -0.04%, compared to 0.19% for the three-month period ended December 31, 2023. Return on average equity for the three-month period ended December 31, 2024, was -0.75%, compared to 4.65% for the three-month period ended December 31, 2023. Lower net income and higher average balances drove the lower return on average assets and the lower return on average equity. The cost of funds was 1.38% for the quarter ended December 31, 2024, compared to 0.64% for the quarter ended December 31, 2023. The 0.74% increase was primarily driven by the increase in the cost of money market deposits and borrowed funds. The book value per share of Bancorp’s common stock was $6.14 on December 31, 2024, compared to $6.70 per share on December 31, 2023. The decrease was primarily due to the increase in unrealized losses on available for sale securities caused by higher market interest rates. On December 31, 2024, the Bank remained above all “well-capitalized” regulatory requirement levels. The Bank’s tier 1 risk-based capital ratio was approximately 15.15% on December 31, 2024, compared to 17.37% on December 31, 2023. Liquidity remained strong due to managed cash and cash equivalents, borrowing lines with the FHLB of Atlanta, the Federal Reserve and correspondent banks, and the size and composition of the bond portfolio. Balance Sheet Review Total assets were $358.9 million on December 31, 2024, an increase of $7.1 million or 2.03%, from $351.8 million on December 31, 2023. Investment securities decreased by $31.5 million or 22.58%, to $107.9 million as of December 31, 2024, compared to $139.4 million for the same period of 2023. Loans, net of deferred fees and costs, were $205.2 million on December 31, 2024, an increase of $28.9 million or 16.40%, from $176.3 million on December 31, 2023. Cash and cash equivalents increased $9.2 million or 60.51%, from $15.2 million on December 31, 2023, to $24.4 million on December 31, 2024. Total deposits were $309.2 million on December 31, 2024, an increase of $9.1 million or 3.04%, from $300.1 million on December 31, 2023. Noninterest-bearing deposits were $100.7 million on December 31, 2024, a decrease of $16.2 million or 13.83%, from $116.9 million on December 31, 2023. Interest-bearing deposits were $208.4 million on December 31, 2024, an increase of $25.3 million or 13.81%, from $183.1 million on December 31, 2023. Total borrowings were $30.0 million on December 31, 2024, unchanged from December 31, 2023. As of December 31, 2024, total stockholders’ equity was $17.8 million (4.96% of total assets), equivalent to a book value of $6.14 per common share. Total stockholders’ equity on December 31, 2023, was $19.3 million (5.49% of total assets), equivalent to a book value of $6.70 per common share. The decrease in the ratio of stockholders’ equity to total assets was primarily due to the $1.5 million decline in net earnings for the year ended December 31, 2024 compared to the prior year, the $0.6 million after-tax increase in market value loss on the Company’s available-for-sale securities portfolio and a $7.1 million increase in total assets. The increase in unrealized losses primarily resulted from increasing market interest rates year-over-year, which decreased the fair value of the investment securities. Asset quality, which has trended within a narrow range over the past several years, remained sound on December 31, 2024. Nonperforming assets, which consist of nonaccrual loans, loans to borrowers experiencing financial difficulty, accruing loans past due 90 days or more, and other real estate owned (“OREO”), represented 0.10% of total assets on December 31, 2024, compared to 0.15% on December 31, 2023. The $7.1 million increase in total assets from December 31, 2023, to December 31, 2024, and the $167,000 decrease in nonperforming assets drove the 0.05% decline. The allowance for credit losses on loans was $2.8 million, or 1.38% of total loans, as of December 31, 2024, compared to $2.2 million, or 1.22% of total loans, as of December 31, 2023. The allowance for credit losses for unfunded commitments was $584,000 as of December 31, 2024, compared to $473,000 as of December 31, 2023. Review of Financial Results For the three-month periods ended December 31, 2024, and 2023 Net loss for the three-month period ended December 31, 2024, was $39,000, compared to net income of $167,000 for the three-month period ended December 31, 2023. Net interest income for the three-month period ended December 31, 2024, totaled $2.8 million, a decrease of $128,000 from the three-month period ended December 31, 2023. Despite a $520,000 increase in interest income, the decrease in net interest income was primarily due to a $648,000 increase in interest expenses predominantly related to the advantage money market deposit product. Net interest margin for the three-month period ended December 31, 2024, was 2.98%, compared to 3.17% for the same period of 2023. Higher average yields and balances on interest-earning assets combined with higher average interest-bearing funds, lower average noninterest-bearing funds, and higher cost of funds were the primary drivers of year-over-year results. The average balance of interest-earning assets increased $7.1 million while the yield increased 0.50% from 3.77% to 4.27%, when comparing the three-month periods ending December 31, 2023, and 2024, respectively. The average balance of interest-bearing funds increased $28.9 million, the average balance of noninterest-bearing funds decreased $21.3 million, and the cost of funds increased 0.74%, when comparing the three-month periods ending December 31, 2023, and 2024, respectively. The average balance of interest-bearing deposits in banks and investment securities decreased $22.1 million from $185.9 million to $163.8 million for the fourth quarter of 2024, compared to the same period of 2023 while the yield increased 0.01% from 2.68% to 2.69% during that same period. Average loan balances increased $29.2 million to $204.7 million for the three-month period ended December 31, 2024, compared to $175.5 million for the same period of 2023, while the yield increased from 4.96% to 5.54% during that same period. The increase in loan yields for the fourth quarter of 2024 reflected continued runoff of the low-yielding indirect automobile loan portfolio and new loan originations at higher yields. The provision of allowance for credit loss on loans for the three-month period ended December 31, 2024, was $71,000, compared to $103,000 for the same period of 2023. Noninterest income for the three-month period ended December 31, 2024, was $332,000, compared to $299,000 for the three-month period ended December 31, 2023, an increase of $33,000 or 11.04%. The increase was primarily driven by a $31,000 casualty gain due to insurance proceeds exceeding the book value of assets destroyed by water damage. For the three-month period ended December 31, 2024, noninterest expense was $3.1 million, compared to $2.9 million for the three-month period ended December 31, 2023, an increase of $171,000 or 5.82%. The primary contributors to the $171,000 increase, when compared to the three-month period ended December 31, 2023, were increases in salary and employee benefits, legal, accounting, and other professional fees, data processing and item processing services and other expenses. For the twelve-month periods ended December 31, 2024, and 2023 Net loss for the twelve-month period ended December 31, 2024, was $112,000, compared to net income of $1.4 million for the twelve-month period ended December 31, 2023. Net interest income for the twelve-month period ended December 31, 2024, totaled $10.9 million, a decrease of $1.2 million from $12.1 million for the twelve-month period ended December 31, 2023. The decrease in net interest income was primarily due to a $3.1 million increase in interest expenses related to growth of the advantage money market deposit product balances and short-term borrowings necessitated by the deposit runoff during 2023, offset by $1.9 million higher interest and fees on loans. Net interest margin for the twelve-month period ended December 31, 2024, was 2.98%, compared to 3.31% for the same period of 2023. Higher average yields and lower average balances of interest-earning assets combined with higher average interest-bearing funds, lower average noninterest-bearing funds, and higher cost of funds were the primary drivers of year-over-year results. The average balance of interest-earning assets decreased $252,000, while the yield increased 0.52% from 3.63% to 4.15%, when comparing the twelve-month periods ending December 31, 2023, and 2024, respectively. The average balance of interest-bearing funds increased $20.2 million, the average balance of noninterest-bearing funds decreased $20.3 million, and the cost of funds increased 0.90%, when comparing the twelve-month periods ending December 31, 2023, and 2024, respectively. The average balance of interest-bearing deposits in banks and investment securities decreased $13.1 million from $187.4 million to $174.3 million for the twelve-month period ending December 31, 2024, compared to the same period of 2023. The yield increased 0.16% from 2.55% to 2.71% during that same period. The increase in yields for the twelve-month period can be attributed to the change in the mix of cash balances held in interest-bearing deposits in banks and investment securities available for sale and increases in the overnight federal funds rate between the years. Average loan balances increased $12.8 million to $192.6 million for the twelve-month period ended December 31, 2024, compared to $179.8 million for the same period of 2023. The yield increased 0.69% from 4.76% to 5.45% during that same period. The increase in loan yields for the twelve-month period ending December 31, 2024, reflected continued runoff of the low-yielding indirect automobile loan portfolio and new loan originations at higher yields. The Company recorded a provision of allowance for credit loss on loans of $844,000 for the twelve-month period ending December 31, 2024, compared to $96,000 for the same period in 2023. The $748,000 increase in the provision in 2024 compared to 2023, primarily reflects a $61,000 increase in net charge offs, a $28.2 million increase in the reservable balance of the loan portfolio and a 0.16% increase in the current expected credit loss percentage. As a result, the allowance for credit loss on loans was $2.8 million on December 31, 2024, representing 1.38% of total loans, compared to $2.2 million, or 1.22% of total loans on December 31, 2023. Noninterest income for the twelve-month period ended December 31, 2024, was $1.2 million, compared to $1.1 million for the twelve-month period ended December 31, 2023, an increase of $57,000 or 5.20%. The increase was driven primarily by a $52,000 increase in other fees and commissions which included a $31,000 casualty gain due to insurance proceeds exceeding the book value of assets destroyed by water damage. For the twelve-month period ended December 31, 2024, noninterest expense was $11.9 million, compared to $11.6 million for the twelve-month period ended December 31, 2023. The primary contributors to the $253,000 increase when compared to the twelve-month period ended December 31, 2023, were increases in legal, accounting, and other professional fees, occupancy and equipment expenses, and other expenses which included the allowance for unfunded commitments, partially offset by decreases in salary and employee benefits costs. Glen Burnie Bancorp Information Glen Burnie Bancorp is a bank holding company headquartered in Glen Burnie, Maryland. Founded in 1949, The Bank of Glen Burnie® is a locally owned community bank with seven branch offices serving Anne Arundel County. The Bank is engaged in the commercial and retail banking business including the acceptance of demand and time deposits, and the origination of loans to individuals, associations, partnerships, and corporations. The Bank’s real estate financing consists of residential first and second mortgage loans, home equity lines of credit and commercial mortgage loans. The Bank also originates automobile loans through arrangements with local automobile dealers. Additional information is available at www.thebankofglenburnie.com. Forward-Looking Statements The statements contained herein that are not historical financial information may be deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties, which could cause the company’s actual results in the future to differ materially from its historical results and those presently anticipated or projected. These statements are evidenced by terms such as “anticipate,” “estimate,” “should,” “expect,” “believe,” “intend,” and similar expressions. Although these statements reflect management’s good faith beliefs and projections, they are not guarantees of future performance and they may not prove true. For a more complete discussion of these and other risk factors, please see the company’s reports filed with the Securities and Exchange Commission. GLEN BURNIE BANCORP AND SUBSIDIARYCONSOLIDATED BALANCE SHEETS(dollars in thousands) December 31, September 30, December 31, 2024 2024 2023 (unaudited) (unaudited) (audited)ASSETS Cash and due from banks$2,012 $2,255 $1,940 Interest-bearing deposits in other financial institutions 22,452 20,207 13,301 Total Cash and Cash Equivalents 24,464 22,462 15,241 Investment securities available for sale, at fair value 107,949 119,958 139,427 Restricted equity securities, at cost 1,671 246 1,217 Loans, net of deferred fees and costs 205,219 206,975 176,307 Less: Allowance for credit losses (2,839) (2,748) (2,157)Loans, net 202,380 204,227 174,150 Premises and equipment, net 2,630 2,723 3,046 Bank owned life insurance 8,834 8,789 8,657 Deferred tax assets, net 8,548 6,879 7,897 Accrued interest receivable 1,345 1,478 1,192 Accrued taxes receivable 148 497 121 Prepaid expenses 471 486 475 Other assets 516 614 390 Total Assets$ 358,956 $ 368,359 $ 351,813 LIABILITIES Noninterest-bearing deposits$100,747 $115,938 $116,922 Interest-bearing deposits 208,442 198,335 183,145 Total Deposits 309,189 314,273 300,067 Short-term borrowings 30,000 30,000 30,000 Defined pension liability 330 329 324 Accrued expenses and other liabilities 1,620 2,597 2,097 Total Liabilities 341,139 347,199 332,488 STOCKHOLDERS' EQUITY Common stock, par value $1, authorized 15,000,000 shares, issued and outstanding 2,900,681; 2,900,681; 2,882,627; shares as of December 31, 2024, September 30, 2024, and December 31, 2023 respectively. 2,901 2,901 2,883 Additional paid-in capital 11,037 11,037 10,964 Retained earnings 22,882 22,921 23,859 Accumulated other comprehensive loss (19,003) (15,699) (18,381)Total Stockholders' Equity 17,817 21,160 19,325 Total Liabilities and Stockholders' Equity$ 358,956 $ 368,359 $ 351,813 GLEN BURNIE BANCORP AND SUBSIDIARYCONSOLIDATED STATEMENTS OF INCOME(dollars in thousands, except per share amounts)(unaudited) Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 Interest income Interest and fees on loans $2,851 $2,192 $10,498 $8,559 Interest and dividends on securities 773 1,082 3,379 4,147 Interest on deposits with banks and federal funds sold 332 162 1,335 631 Total Interest Income 3,956 3,436 15,212 13,337 Interest expense Interest on deposits 818 176 2,533 513 Interest on short-term borrowings 375 369 1,738 689 Total Interest Expense 1,193 545 4,271 1,202 Net Interest Income 2,763 2,891 10,941 12,135 Provision of credit loss allowance 71 103 844 96 Net interest income after release of credit loss provision 2,692 2,788 10,097 12,039 Noninterest income Service charges on deposit accounts 42 39 150 159 Other fees and commissions 245 217 829 777 Income on life insurance 45 43 178 164 Total Noninterest Income 332 299 1,157 1,100 Noninterest expenses Salary and employee benefits 1,708 1,621 6,580 6,710 Occupancy and equipment expenses 330 339 1,325 1,294 Legal, accounting and other professional fees 346 301 1,115 993 Data processing and item processing services 260 250 1,016 1,005 FDIC insurance costs 42 40 161 163 Advertising and marketing related expenses 29 25 117 97 Loan collection costs 13 8 25 22 Telephone costs 44 39 154 151 Other expenses 346 324 1,398 1,203 Total Noninterest Expenses 3,118 2,947 11,891 11,638 (Loss) income before income taxes (94) 140 (637) 1,501 Income tax (benefit) expense (55) (27) (525) 72 Net income (loss) $ (39) $ 167 $ (112) $ 1,429 Basic and diluted net income (loss) per common share $ (0.01) $ 0.06 $ (0.04) $ 0.50 GLEN BURNIE BANCORP AND SUBSIDIARYCONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITYFor the twelve months ended December 31, 2024 and 2023(dollars in thousands)(unaudited) Accumulated Additional Other Total Common Paid-in Retained Comprehensive Stockholders' Stock Capital Earnings (Loss) Income EquityBalance, December 31, 2022$2,865 $10,862 $23,579 $(21,252) $16,054 Net income - - 1,429 - 1,429 Cash dividends, $0.40 per share - - (1,149) - (1,149)Dividends reinvested under dividend reinvestment plan 18 102 - - 120 Other comprehensive income - - - 2,871 2,871 Balance, December 31, 2023$2,883 $10,964 $23,859 $(18,381) $19,325 Accumulated Additional Other Total Common Paid-in Retained Comprehensive Stockholders' Stock Capital Earnings Loss EquityBalance, December 31, 2023$2,883 $10,964 $23,859 $(18,381) $19,325 Net loss - - (112) - (112)Cash dividends, $0.30 per share - - (865) - (865)Dividends reinvested under dividend reinvestment plan 18 73 - - 91 Other comprehensive loss - - - (622) (622)Balance, December 31, 2024$2,901 $11,037 $22,882 $(19,003) $17,817 THE BANK OF GLEN BURNIECAPITAL RATIOS(dollars in thousands)(unaudited) To Be Well Capitalized Under To Be Considered Prompt Corrective Adequately CapitalizedAction Provisions AmountRatio AmountRatio AmountRatioAs of December 31, 2024: Common Equity Tier 1 Capital$36,48115.15% $10,8374.50% $15,6536.50%Total Risk-Based Capital$39,49616.40% $19,2658.00% $24,08210.00%Tier 1 Risk-Based Capital$36,48115.15% $14,4496.00% $19,2658.00%Tier 1 Leverage$36,4819.97% $14,6404.00% $18,3005.00% As of September 30, 2024: Common Equity Tier 1 Capital$36,75515.47% $10,6914.50% $15,4436.50%Total Risk-Based Capital$39,72916.72% $19,0068.00% $23,75810.00%Tier 1 Risk-Based Capital$36,75515.47% $14,2556.00% $19,0068.00%Tier 1 Leverage$36,75510.11% $14,5394.00% $18,1735.00% As of December 31, 2023: Common Equity Tier 1 Capital$37,97517.37% $9,8404.50% $14,2136.50%Total Risk-Based Capital$40,23718.40% $17,4938.00% $21,86710.00%Tier 1 Risk-Based Capital$37,97517.37% $13,1206.00% $17,4938.00%Tier 1 Leverage$37,97510.76% $14,1134.00% $17,6415.00% GLEN BURNIE BANCORP AND SUBSIDIARYSELECTED FINANCIAL DATA(dollars in thousands, except per share amounts) Three Months Ended Twelve Months Ended December 31September 30December 31December 31 December 31 2024 2024 2023 2024 2023 (unaudited) (unaudited) (unaudited) (unaudited) (audited) Financial Data Assets $358,956 $368,359 $351,813 $358,956 $351,813 Investment securities 107,949 119,958 139,427 107,949 139,427 Loans, (net of deferred fees & costs) 205,219 206,975 176,307 205,219 176,307 Allowance for loan losses 2,839 2,748 2,157 2,839 2,157 Deposits 309,189 314,273 300,067 309,189 300,067 Borrowings 30,000 30,000 30,000 30,000 30,000 Stockholders' equity 17,817 21,160 19,325 17,817 19,325 Net income (39) 129 167 (112) 1,429 Average Balances Assets $366,888 $364,127 $353,085 $363,994 $361,731 Investment securities 136,868 142,972 174,581 148,037 173,902 Loans, (net of deferred fees & costs) 204,703 203,316 175,456 192,646 179,790 Deposits 314,046 312,019 310,168 309,838 330,095 Borrowings 30,323 30,001 26,579 32,720 12,580 Stockholders' equity 20,664 19,559 14,253 19,169 17,105 Performance Ratios Annualized return on average assets -0.04% 0.14% 0.19% -0.03% 0.40%Annualized return on average equity -0.75% 2.63% 4.65% -0.58% 8.35%Net interest margin 2.98% 3.06% 3.17% 2.98% 3.31%Dividend payout ratio 0% 224% 172% -773% 80%Book value per share $6.14 $7.29 $6.70 $6.14 $6.70 Basic and diluted net income per share (0.01) 0.04 0.06 (0.04) 0.50 Cash dividends declared per share 0.00 0.10 0.10 0.30 0.40 Basic and diluted weighted average shares outstanding 2,900,681 2,897,929 2,880,398 2,893,871 2,873,500 Asset Quality Ratios Allowance for loan losses to loans 1.38% 1.33% 1.22% 1.38% 1.22%Nonperforming loans to avg. loans 0.18% 0.14% 0.30% 0.19% 0.29%Allowance for loan losses to nonaccrual & 90+ past due loans 789.1% 937.5% 409.3% 789.1% 409.3%Net charge-offs annualize to avg. loans -0.04% -0.09% 0.08% 0.08% 0.06% Capital Ratios Common Equity Tier 1 Capital 15.15% 15.47% 17.37% 15.15% 17.37%Tier 1 Risk-based Capital Ratio 15.15% 15.47% 17.37% 15.15% 17.37%Leverage Ratio 9.97% 10.11% 10.76% 9.97% 10.76%Total Risk-Based Capital Ratio 16.40% 16.72% 18.40% 16.40% 18.40%

Glen Burnie Bancorp Announces Fourth Quarter and Full Year 2024 Results

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