WILMINGTON, Del.--(BUSINESS WIRE)-- The Bancorp, Inc. ("The Bancorp" or “we”) (NASDAQ: TBBK), a financial holding company, today reported financial results for the second quarter of 2023.
Highlights
- The Bancorp reported net income of $49.0 million, or $0.89 per diluted share, for the quarter ended June 30, 2023, compared to net income of $30.4 million, or $0.53 per diluted share, for the quarter ended June 30, 2022, or a 68% increase in income per diluted share.
- Return on assets and equity for the quarter ended June 30, 2023 amounted to 2.6% and 27%, respectively, compared to 1.7% and 19%, respectively, for the quarter ended June 30, 2022 (all percentages “annualized”).
- Net interest income increased 60% to $87.2 million for the quarter ended June 30, 2023, compared to $54.6 million for the quarter ended June 30, 2022. Net interest income increases reflected the impact of continuing Federal Reserve rate increases on the Bancorp’s variable rate loans and securities.
- Net interest margin amounted to 4.83% for the quarter ended June 30, 2023, compared to 3.17% for the quarter ended June 30, 2022, and 4.67% for the quarter ended March 31, 2023.
- Loans, net were $5.27 billion at June 30, 2023, compared to $5.49 billion at December 31, 2022 and $4.75 billion at June 30, 2022. Those changes reflected a decrease of 2% quarter over linked quarter and an increase of 11% year over year.
- Gross dollar volume (“GDV”), representing the total amounts spent on prepaid and debit cards, increased $4.38 billion, or 15%, to $32.78 billion for the quarter ended June 30, 2023, compared to the quarter ended June 30, 2022. The increase reflects continued organic growth with existing partners and the impact of clients added within the past year. Total prepaid, debit card, ACH and other payment fees increased 10% to $24.6 million for the second quarter of 2023 compared to the second quarter of 2022.
- Small business loans (“SBL”), including those held at fair value, grew 10% year over year to $804.0 million at June 30, 2023, and 2% quarter over linked quarter. That growth excludes Paycheck Protection Program (“PPP”) loan balances which amounted to $3.8 million and $10.3 million at June 30, 2023 and June 30, 2022, respectively.
- Direct lease financing balances increased 13% year over year to $657.3 million at June 30, 2023, and 1% quarter over linked quarter.
- At June 30, 2023, real estate bridge loans of $1.83 billion had grown 4% compared to the $1.75 billion balance at March 31, 2023, and 65% compared to the June 30, 2022 balance of $1.11 billion. These real estate bridge loans consist entirely of apartment buildings.
- Security backed lines of credit (“SBLOC”), insurance backed lines of credit (“IBLOC”) and investment advisor financing loans collectively decreased 15% year over year and decreased 8% quarter over linked quarter to $2.06 billion at June 30, 2023.
- The average interest rate on $6.60 billion of average deposits and interest-bearing liabilities during the second quarter of 2023 was 2.37%. Average deposits of $6.48 billion for the second quarter of 2023 reflected an increase of 4% from the $6.25 billion of average deposits for the quarter ended June 30, 2022.
- The Bancorp emphasizes safety and soundness, and liquidity. The vast majority of its funding is comprised of insured and small balance accounts. The Bancorp also has lines of credit with U.S. government agencies totaling approximately $2.8 billion as of June 30, 2023, as well as access to other liquidity.
- As of June 30, 2023, tier one capital to assets (leverage), tier one capital to risk-weighted assets, total capital to risk-weighted assets and common equity-tier 1 to risk-weighted assets ratios were 10.42%, 14.97%, 15.47% and 14.97%, respectively, compared to well-capitalized minimums of 5%, 8%, 10% and 6.5%, respectively. The Bancorp and its wholly owned subsidiary, The Bancorp Bank, National Association, each remain well capitalized under banking regulations.
- Book value per common share at June 30, 2023 was $13.74 per share compared to $11.55 per common share at June 30, 2022, an increase of 19%. Increases resulting from retained earnings were partially offset by reductions in the market value of securities available for sale, which are recognized through equity.
- The Bancorp repurchased 828,727 shares of its common stock at an average cost of $30.17 per share during the quarter ended June 30, 2023.
CEO and President Damian Kozlowski commented, “The Bancorp continued to produce record core profits and exemplar profitability in the second quarter. The outlook remains positive for 2023 and 2024 and we expect increasing profitability and earnings per share, while navigating a difficult market environment for most banks. We are maintaining guidance at $3.60 a share, without including the impact of anticipated share buy backs of $25 million per quarter in 2023.”
Conference Call Webcast
You may access the LIVE webcast of The Bancorp's Quarterly Earnings Conference Call at 8:00 AM ET Friday, July 28, 2023 by clicking on the webcast link on The Bancorp's homepage at www.thebancorp.com. Or you may dial 1.888.259.6580, conference code 93720317. You may listen to the replay of the webcast following the live call on The Bancorp's investor relations website or telephonically until Friday, August 4, 2023 by dialing 1.877.674.7070, access code 720317#.
About The Bancorp
The Bancorp, Inc. (NASDAQ: TBBK), headquartered in Wilmington, Delaware, through its subsidiary, The Bancorp Bank, National Association, (or “The Bancorp Bank, N. A.”) provides non-bank financial companies with the people, processes, and technology to meet their unique banking needs. Through its Fintech Solutions, Institutional Banking, Commercial Lending, and Real Estate Bridge Lending businesses, The Bancorp provides partner-focused solutions paired with cutting-edge technology for companies that range from entrepreneurial startups to Fortune 500 companies. With over 20 years of experience, The Bancorp has become a leader in the financial services industry, earning recognition as the #1 issuer of prepaid cards in the U.S., a nationwide provider of bridge financing for real estate capital improvement plans, an SBA National Preferred Lender, a leading provider of securities-backed lines of credit, with one of the few bank-owned commercial vehicle leasing groups. By its company-wide commitment to excellence, The Bancorp has also been ranked as one of the 100 Fastest-Growing Companies by Fortune, a Top 50 Employer by Equal Opportunity Magazine and was selected to be included in the S&P Small Cap 600. For more about The Bancorp, visit https://thebancorp.com/.
Forward-Looking Statements
Statements in this earnings release regarding The Bancorp’s business which are not historical facts are "forward-looking statements." These statements may be identified by the use of forward-looking terminology, including but not limited to the words “intend,” “may,” “believe,” “will,” “expect,” “look,” “anticipate,” “plan,” “estimate,” “continue,” or similar words , and are based on current expectations about important economic, political, and technological factors, among others, and are subject to risks and uncertainties, which could cause the actual results, events or achievements to differ materially from those set forth in or implied by the forward-looking statements and related assumptions. For further discussion of the risks and uncertainties to which these forward-looking statements may be subject, see The Bancorp’s filings with the Securities and Exchange Commission, including the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of those filings. The forward-looking statements speak only as of the date of this press release. The Bancorp does not undertake to publicly revise or update forward-looking statements in this press release to reflect events or circumstances that arise after the date of this press release, except as may be required under applicable law.
The Bancorp, Inc. Financial highlights (unaudited) |
||||||||||||
Three months ended |
Six months ended |
|||||||||||
June 30, |
June 30, |
|||||||||||
Consolidated condensed income statements |
2023 |
2022 |
2023 |
2022 |
||||||||
(Dollars in thousands, except per share and share data) |
||||||||||||
Net interest income |
$ |
87,195 |
$ |
54,569 |
$ |
173,011 |
$ |
107,422 |
||||
Provision for (reversal of) credit losses |
361 |
(1,450 |
) |
2,264 |
3,509 |
|||||||
Non-interest income |
||||||||||||
ACH, card and other payment processing fees |
2,429 |
2,338 |
4,600 |
4,322 |
||||||||
Prepaid, debit card and related fees |
22,177 |
20,038 |
45,500 |
38,690 |
||||||||
Net realized and unrealized gains on commercial |
||||||||||||
loans, at fair value |
1,921 |
3,682 |
3,646 |
10,517 |
||||||||
Leasing related income |
1,511 |
1,545 |
3,001 |
2,518 |
||||||||
Other non-interest income |
1,298 |
350 |
1,578 |
470 |
||||||||
Total non-interest income |
29,336 |
27,953 |
58,325 |
56,517 |
||||||||
Non-interest expense |
||||||||||||
Salaries and employee benefits |
33,167 |
25,999 |
62,952 |
49,847 |
||||||||
Data processing expense |
1,398 |
1,246 |
2,719 |
2,435 |
||||||||
Legal expense |
949 |
1,474 |
1,907 |
2,268 |
||||||||
Legal settlement |
— |
1,152 |
— |
1,152 |
||||||||
FDIC insurance |
472 |
673 |
1,427 |
1,647 |
||||||||
Software |
4,317 |
4,165 |
8,554 |
8,029 |
||||||||
Other non-interest expense |
9,640 |
8,136 |
20,414 |
15,819 |
||||||||
Total non-interest expense |
49,943 |
42,845 |
97,973 |
81,197 |
||||||||
Income before income taxes |
66,227 |
41,127 |
131,099 |
79,233 |
||||||||
Income tax expense |
17,218 |
10,725 |
32,968 |
19,865 |
||||||||
Net income |
49,009 |
30,402 |
98,131 |
59,368 |
||||||||
Net income per share - basic |
$ |
0.89 |
$ |
0.54 |
$ |
1.78 |
$ |
1.04 |
||||
Net income per share - diluted |
$ |
0.89 |
$ |
0.53 |
$ |
1.76 |
$ |
1.03 |
||||
Weighted average shares - basic |
54,871,681 |
56,801,518 |
55,160,642 |
56,962,000 |
||||||||
Weighted average shares - diluted |
55,269,640 |
57,453,730 |
55,653,950 |
57,772,538 |
||||||||
Condensed consolidated balance sheets |
June 30, |
March 31, |
December 31, |
June 30, |
|||||||||||
2023 (unaudited) |
2023 (unaudited) |
2022 |
2022 (unaudited) |
||||||||||||
(Dollars in thousands, except share data) |
|||||||||||||||
Assets: |
|||||||||||||||
Cash and cash equivalents |
|||||||||||||||
Cash and due from banks |
$ |
6,496 |
$ |
13,736 |
$ |
24,063 |
$ |
12,873 |
|||||||
Interest earning deposits at Federal Reserve Bank |
874,050 |
773,446 |
864,126 |
329,992 |
|||||||||||
Total cash and cash equivalents |
880,546 |
787,182 |
888,189 |
342,865 |
|||||||||||
Investment securities, available-for-sale, at fair value |
776,410 |
787,429 |
766,016 |
826,616 |
|||||||||||
Commercial loans, at fair value |
396,581 |
493,334 |
589,143 |
995,493 |
|||||||||||
Loans, net of deferred fees and costs |
5,267,574 |
5,354,347 |
5,486,853 |
4,754,697 |
|||||||||||
Allowance for credit losses |
(23,284 |
) |
(23,794 |
) |
(22,374 |
) |
(19,087 |
) |
|||||||
Loans, net |
5,244,290 |
5,330,553 |
5,464,479 |
4,735,610 |
|||||||||||
Federal Home Loan Bank, Atlantic Central Bankers Bank, and Federal Reserve Bank stock |
20,157 |
12,629 |
12,629 |
1,643 |
|||||||||||
Premises and equipment, net |
26,408 |
21,319 |
18,401 |
16,693 |
|||||||||||
Accrued interest receivable |
34,062 |
33,729 |
32,005 |
19,264 |
|||||||||||
Intangible assets, net |
1,850 |
1,950 |
2,049 |
2,248 |
|||||||||||
Other real estate owned |
20,952 |
21,117 |
21,210 |
18,873 |
|||||||||||
Deferred tax asset, net |
19,215 |
18,290 |
19,703 |
23,344 |
|||||||||||
Other assets |
122,435 |
99,427 |
89,176 |
137,086 |
|||||||||||
Total assets |
$ |
7,542,906 |
$ |
7,606,959 |
$ |
7,903,000 |
$ |
7,119,735 |
|||||||
Liabilities: |
|||||||||||||||
Deposits |
|||||||||||||||
Demand and interest checking |
$ |
6,554,967 |
$ |
6,607,767 |
$ |
6,559,617 |
$ |
5,394,562 |
|||||||
Savings and money market |
68,084 |
96,890 |
140,496 |
486,189 |
|||||||||||
Time deposits, $100,000 and over |
— |
— |
330,000 |
— |
|||||||||||
Total deposits |
6,623,051 |
6,704,657 |
7,030,113 |
5,880,751 |
|||||||||||
Securities sold under agreements to repurchase |
42 |
42 |
42 |
42 |
|||||||||||
Short-term borrowings |
— |
— |
— |
385,000 |
|||||||||||
Senior debt |
95,682 |
99,142 |
99,050 |
98,866 |
|||||||||||
Subordinated debenture |
13,401 |
13,401 |
13,401 |
13,401 |
|||||||||||
Other long-term borrowings |
9,917 |
9,972 |
10,028 |
39,125 |
|||||||||||
Other liabilities |
51,646 |
54,597 |
56,335 |
46,014 |
|||||||||||
Total liabilities |
$ |
6,793,739 |
$ |
6,881,811 |
$ |
7,208,969 |
$ |
6,463,199 |
|||||||
Shareholders' equity: |
|||||||||||||||
Common stock - authorized, 75,000,000 shares of $1.00 par value; 54,542,284 and 56,865,494 shares issued and outstanding at June 30, 2023 and 2022, respectively |
54,542 |
55,330 |
55,690 |
56,865 |
|||||||||||
Additional paid-in capital |
256,115 |
277,814 |
299,279 |
323,774 |
|||||||||||
Retained earnings |
467,450 |
418,441 |
369,319 |
298,474 |
|||||||||||
Accumulated other comprehensive loss |
(28,940 |
) |
(26,437 |
) |
(30,257 |
) |
(22,577 |
) |
|||||||
Total shareholders' equity |
749,167 |
725,148 |
694,031 |
656,536 |
|||||||||||
Total liabilities and shareholders' equity |
$ |
7,542,906 |
$ |
7,606,959 |
$ |
7,903,000 |
$ |
7,119,735 |
|||||||
Average balance sheet and net interest income |
Three months ended June 30, 2023 |
Three months ended June 30, 2022 |
||||||||||||||||||
(Dollars in thousands; unaudited) |
||||||||||||||||||||
Average |
Average |
Average |
Average |
|||||||||||||||||
Assets: |
Balance |
Interest(1) |
Rate |
Balance |
Interest(1) |
Rate |
||||||||||||||
Interest earning assets: |
||||||||||||||||||||
Loans, net of deferred fees and costs(2) |
$ |
5,730,384 |
$ |
107,299 |
7.49 |
% |
$ |
5,467,516 |
$ |
55,100 |
4.03 |
% |
||||||||
Leases-bank qualified(3) |
3,801 |
100 |
10.52 |
% |
3,665 |
63 |
6.88 |
% |
||||||||||||
Investment securities-taxable |
778,100 |
9,873 |
5.08 |
% |
879,112 |
5,432 |
2.47 |
% |
||||||||||||
Investment securities-nontaxable(3) |
3,234 |
53 |
6.56 |
% |
3,559 |
31 |
3.48 |
% |
||||||||||||
Interest earning deposits at Federal Reserve Bank |
701,057 |
8,997 |
5.13 |
% |
545,027 |
1,004 |
0.74 |
% |
||||||||||||
Net interest earning assets |
7,216,576 |
126,322 |
7.00 |
% |
6,898,879 |
61,630 |
3.57 |
% |
||||||||||||
Allowance for credit losses |
(23,895 |
) |
(20,295 |
) |
||||||||||||||||
Other assets |
231,035 |
243,459 |
||||||||||||||||||
$ |
7,423,716 |
$ |
7,122,043 |
|||||||||||||||||
Liabilities and Shareholders' Equity: |
||||||||||||||||||||
Deposits: |
||||||||||||||||||||
Demand and interest checking |
$ |
6,399,750 |
$ |
36,688 |
2.29 |
% |
$ |
5,697,507 |
$ |
4,390 |
0.31 |
% |
||||||||
Savings and money market |
78,252 |
728 |
3.72 |
% |
556,847 |
1,200 |
0.86 |
% |
||||||||||||
Total deposits |
6,478,002 |
37,416 |
2.31 |
% |
6,254,354 |
5,590 |
0.36 |
% |
||||||||||||
Short-term borrowings |
— |
— |
— |
11,593 |
32 |
1.10 |
% |
|||||||||||||
Repurchase agreements |
41 |
— |
— |
41 |
— |
— |
||||||||||||||
Long-term borrowings |
9,949 |
128 |
5.15 |
% |
— |
— |
— |
|||||||||||||
Subordinated debentures |
13,401 |
271 |
8.09 |
% |
13,401 |
139 |
4.15 |
% |
||||||||||||
Senior debt |
96,890 |
1,280 |
5.28 |
% |
98,816 |
1,280 |
5.18 |
% |
||||||||||||
Total deposits and liabilities |
6,598,283 |
39,095 |
2.37 |
% |
6,378,205 |
7,041 |
0.44 |
% |
||||||||||||
Other liabilities |
88,276 |
89,422 |
||||||||||||||||||
Total liabilities |
6,686,559 |
6,467,627 |
||||||||||||||||||
Shareholders' equity |
737,157 |
654,416 |
||||||||||||||||||
$ |
7,423,716 |
$ |
7,122,043 |
|||||||||||||||||
Net interest income on tax equivalent basis(3) |
$ |
87,227 |
$ |
54,589 |
||||||||||||||||
Tax equivalent adjustment |
32 |
20 |
||||||||||||||||||
Net interest income |
$ |
87,195 |
$ |
54,569 |
||||||||||||||||
Net interest margin(3) |
4.83 |
% |
3.17 |
% |
||||||||||||||||
(1)Interest on loans for 2023 and 2022 includes $10,000 and $41,000, respectively, of interest and fees on PPP loans. |
(2)Includes commercial loans, at fair value. All periods include non-accrual loans. |
(3)Full taxable equivalent basis, using 21% respective statutory federal tax rates in 2023 and 2022. |
Average balance sheet and net interest income |
Six months ended June 30, 2023 |
Six months ended June 30, 2022 |
||||||||||||||||||
(Dollars in thousands; unaudited) |
||||||||||||||||||||
Average |
Average |
Average |
Average |
|||||||||||||||||
Assets: |
Balance |
Interest(1) |
Rate |
Balance |
Interest(1) |
Rate |
||||||||||||||
Interest earning assets: |
||||||||||||||||||||
Loans, net of deferred fees and costs(2) |
$ |
5,858,040 |
$ |
213,503 |
7.29 |
% |
$ |
5,302,850 |
$ |
105,638 |
3.98 |
% |
||||||||
Leases-bank qualified(3) |
3,582 |
169 |
9.44 |
% |
3,839 |
130 |
6.77 |
% |
||||||||||||
Investment securities-taxable |
776,089 |
19,173 |
4.94 |
% |
909,017 |
10,323 |
2.27 |
% |
||||||||||||
Investment securities-nontaxable(3) |
3,288 |
94 |
5.72 |
% |
3,559 |
62 |
3.48 |
% |
||||||||||||
Interest earning deposits at Federal Reserve Bank |
640,864 |
15,582 |
4.86 |
% |
616,865 |
1,351 |
0.44 |
% |
||||||||||||
Net interest earning assets |
7,281,863 |
248,521 |
6.83 |
% |
6,836,130 |
117,504 |
3.44 |
% |
||||||||||||
Allowance for credit losses |
(23,215 |
) |
(19,075 |
) |
||||||||||||||||
Other assets |
234,037 |
232,402 |
||||||||||||||||||
$ |
7,492,685 |
$ |
7,049,457 |
|||||||||||||||||
Liabilities and Shareholders' Equity: |
||||||||||||||||||||
Deposits: |
||||||||||||||||||||
Demand and interest checking |
$ |
6,401,678 |
$ |
69,071 |
2.16 |
% |
$ |
5,636,415 |
$ |
5,796 |
0.21 |
% |
||||||||
Savings and money market |
105,105 |
1,947 |
3.70 |
% |
544,515 |
1,400 |
0.51 |
% |
||||||||||||
Time deposits |
41,933 |
858 |
4.09 |
% |
— |
— |
— |
|||||||||||||
Total deposits |
6,548,716 |
71,876 |
2.20 |
% |
6,180,930 |
7,196 |
0.23 |
% |
||||||||||||
Short-term borrowings |
10,193 |
234 |
4.59 |
% |
6,104 |
32 |
1.05 |
% |
||||||||||||
Repurchase agreements |
41 |
— |
— |
41 |
— |
— |
||||||||||||||
Long-term borrowings |
9,973 |
254 |
5.09 |
% |
— |
— |
— |
|||||||||||||
Subordinated debentures |
13,401 |
532 |
7.94 |
% |
13,401 |
255 |
3.81 |
% |
||||||||||||
Senior debt |
97,985 |
2,559 |
5.22 |
% |
98,770 |
2,559 |
5.18 |
% |
||||||||||||
Total deposits and liabilities |
6,680,309 |
75,455 |
2.26 |
% |
6,299,246 |
10,042 |
0.32 |
% |
||||||||||||
Other liabilities |
90,777 |
95,716 |
||||||||||||||||||
Total liabilities |
6,771,086 |
6,394,962 |
||||||||||||||||||
Shareholders' equity |
721,599 |
654,495 |
||||||||||||||||||
$ |
7,492,685 |
$ |
7,049,457 |
|||||||||||||||||
Net interest income on tax equivalent basis(3) |
$ |
173,066 |
$ |
107,462 |
||||||||||||||||
Tax equivalent adjustment |
55 |
40 |
||||||||||||||||||
Net interest income |
$ |
173,011 |
$ |
107,422 |
||||||||||||||||
Net interest margin(3) |
4.75 |
% |
3.14 |
% |
||||||||||||||||
(1)Interest on loans for 2023 and 2022 includes $20,000 and $481,000, respectively, of interest and fees on PPP loans. |
(2)Includes commercial loans, at fair value. All periods include non-accrual loans. |
(3)Full taxable equivalent basis, using 21% respective statutory federal tax rates in 2023 and 2022. |
Allowance for credit losses |
Six months ended |
Year ended |
|||||||||
June 30, |
June 30, |
December 31, |
|||||||||
2023 (unaudited) |
2022 (unaudited) |
2022 |
|||||||||
(Dollars in thousands) |
|||||||||||
Balance in the allowance for credit losses at beginning of period |
$ |
22,374 |
$ |
17,806 |
$ |
17,806 |
|||||
Loans charged-off: |
|||||||||||
SBA non-real estate |
871 |
844 |
885 |
||||||||
Direct lease financing |
1,439 |
199 |
576 |
||||||||
Consumer - other |
3 |
— |
— |
||||||||
Total |
2,313 |
1,043 |
1,461 |
||||||||
Recoveries: |
|||||||||||
SBA non-real estate |
298 |
33 |
140 |
||||||||
SBA commercial mortgage |
75 |
— |
— |
||||||||
Direct lease financing |
175 |
93 |
124 |
||||||||
Consumer - home equity |
49 |
— |
— |
||||||||
Other loans |
— |
— |
24 |
||||||||
Total |
597 |
126 |
288 |
||||||||
Net charge-offs |
1,716 |
917 |
1,173 |
||||||||
Provision for credit losses, excluding commitment provision |
2,626 |
2,198 |
5,741 |
||||||||
Balance in allowance for credit losses at end of period |
$ |
23,284 |
$ |
19,087 |
$ |
22,374 |
|||||
Net charge-offs/average loans |
0.03 |
% |
0.02 |
% |
0.03 |
% |
|||||
Net charge-offs/average assets |
0.02 |
% |
0.01 |
% |
0.02 |
% |
|||||
Loan portfolio |
June 30, |
March 31, |
December 31, |
June 30, |
||||||||
2023 (unaudited) |
2023 (unaudited) |
2022 |
2022 (unaudited) |
|||||||||
(Dollars in thousands) |
||||||||||||
SBL non-real estate |
$ |
117,621 |
$ |
114,334 |
$ |
108,954 |
$ |
112,854 |
||||
SBL commercial mortgage |
515,008 |
492,798 |
474,496 |
425,219 |
||||||||
SBL construction |
32,471 |
33,116 |
30,864 |
27,042 |
||||||||
Small business loans |
665,100 |
640,248 |
614,314 |
565,115 |
||||||||
Direct lease financing |
657,316 |
652,541 |
632,160 |
583,086 |
||||||||
SBLOC / IBLOC(1) |
1,883,607 |
2,053,450 |
2,332,469 |
2,274,256 |
||||||||
Advisor financing(2) |
173,376 |
189,425 |
172,468 |
155,235 |
||||||||
Real estate bridge loans |
1,826,227 |
1,752,322 |
1,669,031 |
1,106,875 |
||||||||
Other loans(3) |
55,644 |
60,210 |
61,679 |
63,514 |
||||||||
5,261,270 |
5,348,196 |
5,482,121 |
4,748,081 |
|||||||||
Unamortized loan fees and costs |
6,304 |
6,151 |
4,732 |
6,616 |
||||||||
Total loans, including unamortized fees and costs |
$ |
5,267,574 |
$ |
5,354,347 |
$ |
5,486,853 |
$ |
4,754,697 |
||||
Small business portfolio |
June 30, |
March 31, |
December 31, |
June 30, |
|||||||
2023 (unaudited) |
2023 (unaudited) |
2022 |
2022 (unaudited) |
||||||||
(Dollars in thousands) |
|||||||||||
SBL, including unamortized fees and costs |
$ |
673,667 |
$ |
648,858 |
$ |
621,641 |
$ |
571,559 |
|||
SBL, included in loans, at fair value |
134,131 |
140,909 |
146,717 |
168,579 |
|||||||
Total small business loans(4) |
$ |
807,798 |
$ |
789,767 |
$ |
768,358 |
$ |
740,138 |
|||
(1)SBLOC are collateralized by marketable securities, while IBLOC are collateralized by the cash surrender value of insurance policies. At June 30, 2023 and December 31, 2022, IBLOC loans amounted to $806.1 million and $1.12 billion, respectively. |
(2)In 2020 The Bancorp began originating loans to investment advisors for purposes of debt refinancing, acquisition of another firm or internal succession. Maximum loan amounts are subject to loan-to-value (“LTV”) ratios of 70%, based on third-party business appraisals, but may be increased depending upon the debt service coverage ratio. Personal guarantees and blanket business liens are obtained as appropriate. |
(3)Includes demand deposit overdrafts reclassified as loan balances totaling $403,000 and $2.6 million at June 30, 2023 and December 31, 2022, respectively. Estimated overdraft charge-offs and recoveries are reflected in the ACL and are immaterial. |
(4)The SBLs held at fair value are comprised of the government guaranteed portion of 7(a) Program loans at the dates indicated. |
Small business loans as of June 30, 2023 |
|||
Loan principal |
|||
(Dollars in millions) |
|||
U.S. government guaranteed portion of SBA loans(1) |
$ |
382 |
|
PPP loans(1) |
4 |
||
Commercial mortgage SBA(2) |
259 |
||
Construction SBA(3) |
12 |
||
Non-guaranteed portion of U.S. government guaranteed 7(a) Program loans(4) |
105 |
||
Non-SBA SBLs |
35 |
||
Total principal |
$ |
797 |
|
Unamortized fees and costs |
11 |
||
Total SBLs |
$ |
808 |
|
(1)Includes the portion of SBA 7(a) Program loans and PPP loans which have been guaranteed by the U.S. government, and therefore are assumed to have no credit risk. |
(2)Substantially all these loans are made under the 504 Program, which dictates origination date LTV percentages, generally 50-60%, to which the Bancorp adheres. |
(3)Includes $8.0 million in 504 Program first mortgages with an origination date LTV of 50-60%, and $4.0 million in SBA interim loans with an approved SBA post-construction full takeout/payoff. |
(4)Includes the unguaranteed portion of 7(a) Program loans which are 70% or more guaranteed by the U.S. government. SBA 7(a) Program loans are not made on the basis of real estate LTV; however, they are subject to SBA's "All Available Collateral" rule which mandates that to the extent a borrower or its 20% or greater principals have available collateral (including personal residences), the collateral must be pledged to fully collateralize the loan, after applying SBA-determined liquidation rates. In addition, all 7(a) Program loans and 504 Program loans require the personal guaranty of all 20% or greater owners. |
Small business loans by type as of June 30, 2023 |
|||||||||||||||
(Excludes government guaranteed portion of SBA 7(a) Program and PPP loans) |
|||||||||||||||
SBL commercial mortgage(1) |
SBL construction(1) |
SBL non-real estate |
Total |
% Total |
|||||||||||
(Dollars in millions) |
|||||||||||||||
Hotels and motels |
$ |
74 |
$ |
— |
$ |
— |
$ |
74 |
18% |
||||||
Full-service restaurants |
24 |
4 |
2 |
30 |
7% |
||||||||||
Funeral homes and funeral services |
27 |
— |
— |
27 |
7% |
||||||||||
Car washes |
17 |
2 |
— |
19 |
5% |
||||||||||
Child day care services |
15 |
1 |
1 |
17 |
4% |
||||||||||
Outpatient mental health and substance abuse centers |
16 |
— |
— |
16 |
4% |
||||||||||
Homes for the elderly |
13 |
— |
— |
13 |
3% |
||||||||||
Gasoline stations with convenience stores |
12 |
— |
— |
12 |
3% |
||||||||||
Offices of lawyers |
9 |
— |
— |
9 |
2% |
||||||||||
Fitness and recreational sports centers |
8 |
— |
2 |
10 |
2% |
||||||||||
Lessors of other real estate property |
8 |
— |
1 |
9 |
2% |
||||||||||
Limited-service restaurants |
2 |
2 |
3 |
7 |
2% |
||||||||||
General warehousing and storage |
7 |
— |
— |
7 |
2% |
||||||||||
Plumbing, heating, and air-conditioning companies |
6 |
— |
1 |
7 |
2% |
||||||||||
Specialty trade contractors |
5 |
— |
1 |
6 |
1% |
||||||||||
Lessors of residential buildings and dwellings |
5 |
— |
— |
5 |
1% |
||||||||||
Other miscellaneous durable goods merchant |
5 |
— |
— |
5 |
1% |
||||||||||
Technical and trade schools |
— |
5 |
— |
5 |
1% |
||||||||||
Packaged frozen food merchant wholesalers |
5 |
— |
— |
5 |
1% |
||||||||||
Amusement and recreation industries |
4 |
— |
— |
4 |
1% |
||||||||||
Offices of dentists |
2 |
1 |
— |
3 |
1% |
||||||||||
Warehousing and storage |
3 |
— |
— |
3 |
1% |
||||||||||
Vocational rehabilitation services |
3 |
— |
— |
3 |
1% |
||||||||||
Miscellaneous wood product manufacturing |
3 |
— |
— |
3 |
1% |
||||||||||
Other(2) |
88 |
— |
24 |
112 |
27% |
||||||||||
Total |
$ |
361 |
$ |
15 |
$ |
35 |
$ |
411 |
100% |
||||||
(1)Of the SBL commercial mortgage and SBL construction loans, $106.0 million represents the total of the non-guaranteed portion of SBA 7(a) Program loans and non-SBA loans. The balance of those categories represents SBA 504 Program loans with 50%-60% origination date LTVs. |
(2)Loan types of less than $3.0 million are spread over approximately one hundred different business types. |
State diversification as of June 30, 2023 |
|||||||||||||||
(Excludes government guaranteed portion of SBA 7(a) Program loans and PPP loans) |
|||||||||||||||
SBL commercial mortgage(1) |
SBL construction(1) |
SBL non-real estate |
Total |
% Total |
|||||||||||
(Dollars in millions) |
|||||||||||||||
California |
$ |
74 |
$ |
4 |
$ |
3 |
$ |
81 |
20% |
||||||
Florida |
68 |
1 |
3 |
72 |
18% |
||||||||||
North Carolina |
33 |
7 |
2 |
42 |
10% |
||||||||||
New York |
26 |
— |
3 |
29 |
7% |
||||||||||
New Jersey |
20 |
— |
3 |
23 |
6% |
||||||||||
Pennsylvania |
21 |
— |
— |
21 |
5% |
||||||||||
Georgia |
16 |
— |
1 |
17 |
4% |
||||||||||
Illinois |
14 |
— |
1 |
15 |
4% |
||||||||||
Texas |
12 |
— |
4 |
16 |
4% |
||||||||||
Other States | |||||||||||||||