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FOR IMMEDIATE RELEASE
April 30, 2008
MILLENNIUM BANKSHARES REPORTS 1st QUARTER RESULTS AND COMPLETION OF STRATEGIC INITIATIVES
Reston, VA April 30, 2008 Millennium Bankshares Corporation (Nasdaq: MBVA) today announced first quarter net income of $5,122,000 and the completion of strategic initiatives to restructure the balance sheet. Millennium reported that the sale of the two Richmond, Virginia branches was completed on March 14th, the bulk sale of the held-for-sale/repurchased sub-prime mortgage portfolio was completed on February 8th, and the sale of approximately $88 million in investment securities to fund the branch sale and improve liquidity was accomplished in the first quarter to bring total sales/calls since the fourth quarter 2007 to approximately $104 million. The final results of the execution of these strategic initiatives were at or slightly better than previously anticipated results reported in previous 8-K filings.
Net income for the first quarter amounted to $5,122,000 or $.57 per share. Included in net income for the quarter was an $8,338,000 pre-tax net gain on the sale of the two branches and a pre-tax gain on the sale of securities of $734,000. The gain on the sale of the branches after expenses exceeded the previously announced anticipated gain by $338,000, as a result of an increase in the deposit balances of the branches as of the closing. Total deposits sold amounted to $91.9 million. Total loans of $48.9 million, originated in the Richmond market, were also purchased by the buyer of the branches. The gain on the sale of securities is a result of the difference between the impairment loss recorded in the 4th quarter of 2007 and the actual losses realized on the sales of securities during the first quarter. A favorable rate environment resulted in a smaller realized loss on sales than the impairment charge recorded as of December 31, 2007. Additionally, as a result of improvements in the yield curve subsequent to December 31, 2007, a number of callable agency securities were called at par value. The loss on the sale of approximately $31 million in mortgages held for sale and repurchased mortgages was recognized in December 2007, as the Company wrote down the carrying value of the mortgages to the purchase price to be received. The Company realized a blended rate of 43.55% of the loan balance, plus accrued interest. Although the sale resulted in a substantial write-down, the Company believes the sale of the held for sale and repurchased loans enabled the Company to avoid further losses resulting from continued deterioration in the market for such loans, ongoing workout costs and lost opportunity costs, and enabled management to refocus its efforts on core community banking activities.
At March 31, 2008, on a consolidated basis Millennium Bankshares Corporation had total assets of $381.0 million, loans of $230.9 million, and capital of $44.3 million. With the first quarter gains, tangible book value per share has increased to $4.96. As of March 31, 2008 non-performing assets, which include other real estate owned, have declined to $16.2 million, and the allowance for loan losses as a percentage of loans is 1.69%. The Company had an equity to assets ratio of 11.6% at March 31, 2008. Management has made considerable progress during the first quarter 2008 in continuing to address corrective actions required to comply with the provisions of the Formal Agreement with the Office of the Comptroller of the Currency signed on January 24, 2008. At March 31, 2008, the Company had four community business branches focused in the Northern Virginia marketplace and a new team of respected commercial lenders.
The Companys subsidiary, Millennium Bank, N.A., has now been reduced materially in size, with better liquidity and a stronger capital position than prior to the implementation of the Companys strategic initiatives. At March 31, 2008, the Bank had tier 1 capital to risk-weighted assets of 16.99%, total capital to risk-weighted assets of 18.24% and a leverage ratio of 10.05%, ratios that met or exceeded the Formal Agreement mandates. The Bank, furthermore, made considerable progress in reducing its exposure to construction and land development loans which dropped from 163 percent of total risk based capital at year end 2007 to 102 percent of total risk based capital by March 31, 2008. In addition all sub-prime mortgages have been sold. By comparison, selected balance sheet highlights for the Bank at March 31, 2008 compared to June 30 of last year, the date when the Bank began initiating a series of corrective actions and strategic directions under new leadership, are shown below:
The following information was filed by Millennium Bankshares Corp (MBVA) on Thursday, May 1, 2008 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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