Sandy Spring Bancorp Inc (SASR) SEC Filing 10-K Annual report for the fiscal year ending Saturday, December 31, 2011

 

News release

 

FOR IMMEDIATE RELEASE

 

SANDY SPRING BANCORP REPORTS FOURTH QUARTER PROFIT OF

$7.3 MILLION; NET INCOME FOR 2011 WAS $34.1 MILLION, UP 45% OVER 2010

 

OLNEY, MARYLAND, January 26, 2012 — Sandy Spring Bancorp, Inc., (Nasdaq-SASR) the parent company of Sandy Spring Bank, today announced net income for the fourth quarter of 2011 of $7.3 million ($.30 per diluted share) compared to net income of $8.3 million ($0.34 per diluted share) for the fourth quarter of 2010 and net income of $11.3 million ($0.47 per diluted share) for the previous quarter of 2011. The provision for loan and lease losses for the fourth quarter of 2011 was a charge of $2.3 million compared to a charge of $2.3 million for the fourth quarter of 2010 and a credit of $3.5 million for the third quarter of 2011.

 

Net income for the year ended December 31, 2011 totaled $34.1 million ($1.41 per diluted share), up 45% compared to net income of $23.5 million ($1.05 per diluted share) for the prior year. The provision for loan and lease losses for the year ended December 31, 2011 was a charge of $1.4 million for 2011 compared to a charge of $25.9 million for 2010.

 

“We are very pleased to report another quarter of increased loan growth even in the face of volatile financial markets and continued uneven economic conditions on both a regional and national level. This organic loan growth is an especially encouraging prospect in view of the anticipated infusion of additional quality loans in the coming year from our recently announced acquisition of CommerceFirst Bank,” said Daniel J. Schrider, President and Chief Executive Officer. “We have proactively managed our funding costs to improve the mix of lower cost transaction accounts as compared to other higher cost funding sources.

 

“The higher levels of core deposits and wealth management revenues are strong indicators of our success in building long term customer relationships that are centered on a consistent unique and positive experience for each of our clients,” reiterated Schrider. “This is evidence of the resiliency of our business model, especially during such a competitive and prolonged tough economic climate.”

 

Fourth Quarter Highlights:

 

·

Total loans reflected a second straight quarterly increase due primarily to growth in commercial business, ADC loans and residential construction loans. New commercial loan originations totaled $269 million for the year compared to $112 million for the prior year.

 

 

	·	Non-performing loans declined to $79.1 million at December 31, 2011 compared to $88.1 million at December 31, 2010 and $82.8 million at September 30, 2011. The coverage ratio of the allowance for loan and lease losses to non-performing loans decreased to 62% at December 31, 2011 compared to a ratio of 71% at December 31, 2010 and 60% at September 30, 2011.
	·	The net interest margin declined to 3.51% for the fourth quarter of 2011, compared to 3.61% for the fourth quarter of 2010 and 3.53% for the third quarter of 2011.
	·	Revenue from wealth management services, which includes fees from trust and investment management and sales of investment products, increased 7% for the fourth quarter of 2011 compared to the fourth quarter of 2010 due to growth in average assets under management resulting primarily from adding new clients and market conditions that permitted more favorable returns.

 

Review of Balance Sheet and Credit Quality

 

Comparing December 31, 2011 balances to December 31, 2010, total assets increased 5% to $3.7 billion. Total loans and leases increased 4% to $2.2 billion compared to the prior year end. The increase in loans for the year was due primarily to growth in the commercial loan portfolio, most of which occurred during the last quarter of the year. During the current quarter, total loans increased 4% compared to balances at September 30, 2011.

 

Customer funding sources, which include deposits and other short-term borrowings from customers, increased 3% compared to December 31, 2010. This increase was due largely to a 15% increase in noninterest-bearing and interest-bearing checking accounts which more than offset a 7% reduction in certificates of deposit, which declined as a result of continuing rate reductions reflecting the Company’s net interest margin strategy. Growth in checking accounts was the main driver in the increase in core deposits due to clients’ emphasis on safety and liquidity.

 

Tangible common equity totaled $351.3 million at December 31, 2011 compared to $326.8 million at December 31, 2010 resulting in an increase in the ratio of tangible common equity to tangible assets from 9.51% at December 31, 2010 to 9.68% at December 31, 2011. This increase was due primarily to net income earned during the period. At December 31, 2011, the Company had a total risk-based capital ratio of 15.83%, a tier 1 risk-based capital ratio of 14.57% and a tier 1 leverage ratio of 10.84%.

 

Non-performing assets totaled $83.6 million at December 31, 2011 compared to $97.7 million at December 31, 2010 and $90.8 million at September 30, 2011. Overall credit quality continued to improve as a result of resolution of existing problem credits and limited migration of new credits to non-performing status.

 

The provision for loan and lease losses was a charge of $2.3 million for both the fourth quarter of 2011 and the fourth quarter of 2010 and a credit of $3.5 million for the third quarter of 2011. The increase in the provision for the fourth quarter of 2011 compared to the prior quarter was due to a combination of factors including an increase in outstanding loan balances during the fourth quarter and specific reserves on several commercial loan credits.

 

 

Loan charge-offs, net of recoveries, totaled $2.6 million for the fourth quarter of 2011 compared to net charge-offs of $7.5 million for the fourth quarter of 2010 and net charge-offs of $2.0 million for the third quarter of 2011. The allowance for loan and lease losses represented 2.21% of outstanding loans and leases and 62% of non-performing loans at December 31, 2011 compared to 2.88% of outstanding loans and leases and 71% of non-performing loans at December 31, 2010 and 2.32% of outstanding loans and leases and 60% of non-performing loans at September 30, 2011. Non-performing loans includes accruing loans 90 days or more past due and restructured loans.

 

Income Statement Review

 

Net interest income for the fourth quarter of 2011 decreased by $0.5 million or 2% compared to the fourth quarter of 2010 due primarily to a decrease in interest income resulting from lower average overall earning asset yields. This decline in interest income was somewhat offset by a decrease in interest expense as average rates paid on deposit products decreased, although at a slower pace, together with a planned run-off in average deposits. These factors resulted in a decline in the net interest margin to 3.51% for the fourth quarter of 2011 compared to 3.61% for the fourth quarter of 2010.

 

Non-interest income decreased $0.3 million or 3% to $11.4 million for the fourth quarter of 2011 compared to $11.7 million for the fourth quarter of 2010. This decrease was due primarily to a decline of $0.3 million or 24% in other non-interest income due to lower commercial loan fees. In addition, income from mortgage banking activities decreased $0.1 million or 10% due to lower origination and sale volume compared to the fourth quarter of 2010. These decreases were largely offset by an increase in trust and investment management fees of $0.3 million or 11% due primarily to higher average assets under management and an increase in insurance agency commissions of $0.1 million or 10% due to higher income from commercial lines.

 

Non-interest expenses were $27.3 million for the fourth quarter of 2011 compared to $26.2 million in the fourth quarter of 2010, an increase of $1.1 million or 4%. This increase was driven by an increase of $1.4 million or 10% in salaries and benefits expense due to higher salary and incentive compensation expenses. This increase was partially offset by a decrease of $0.4 million or 37% in FDIC insurance premiums.

 

Net interest income for the year ended December 31, 2011 decreased by $2.7 million or 2% compared to 2010 as a result of a decline in interest income due mainly to lower average loan balances and record low market interest rates. The impact of an $8.9 million decline in interest income was substantially mitigated by a $6.2 million decline in interest expense as average rates paid on deposit products decreased, although at a slower pace. This resulted in a net interest margin of 3.57% for 2011 compared to 3.60% for 2010.

 

Non-interest income totaled $43.5 million for the year ended December 31, 2011 as compared to $43.8 million for the prior year. Deposit service charges declined $0.8 million or 8% as a result of the impact of recently enacted legislation on overdraft fees while income from mortgage banking activities decreased $0.4 million or 12% due to lower gains on sales resulting from declines in both rates and volumes. Trust and investment management fees increased $1.7 million or 16% primarily due to growth in average assets under management. Fees on sales of investment products increased $0.3 million or 8% due primarily to an increase in managed assets. These increases in asset management fee income substantially offset the erosion experienced in deposit service fee income. Visa check fees increased $0.3 million or 9% due to a continued increase in the volume of electronic transactions.

 

 

Non-interest expenses were $105.1 million for the year ended December 31, 2011 compared to $100.9 million for 2010, an increase of $4.2 million or 4%. Salaries and benefits expense increased $4.2 million or 7% due primarily to higher salary and incentive compensation expenses. Other non-interest expenses increased $1.3 million or 8% due largely to losses on sales of other real estate owned and loan work out expenses. These increases were partially offset by a decrease of $1.3 million or 29% in FDIC insurance premiums.

 

Additional Information For Shareholders

 

In connection with the proposed merger transaction, Sandy Spring Bancorp will file with the Securities and Exchange Commission a Registration Statement on Form S-4 that will include a Proxy Statement of CommerceFirst Bancorp and a Prospectus of Sandy Spring Bancorp, as well as other relevant documents concerning the proposed transaction. Shareholders are urged to read the Registration Statement and the Proxy Statement/Prospectus regarding the merger when it becomes available and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information.

 

A free copy of the Proxy Statement/Prospectus, as well as other filings containing information about Sandy Spring Bancorp and CommerceFirst Bancorp, may be obtained at the SEC’s Internet site (http://www.sec.gov). You will also be able to obtain these documents, free of charge, from Sandy Spring Bancorp at www.sandyspringbank.com under the tab “Investor Relations,” within the section “News & Media” and then under the heading “Documents” or from CommerceFirst Bancorp by accessing CommerceFirst Bancorp’s website at www.commerce1st.com under the tab “About Us,” within the section “Investor Relations” and then under the heading “CommerceFirst Bancorp Security and Exchange Commission (SEC) Filings.”

 

Sandy Spring Bancorp and CommerceFirst Bancorp and certain of their directors and executive officers may be deemed to be participants in the solicitation of proxies from the shareholders of CommerceFirst Bancorp in connection with the proposed merger. Information about the directors and executive officers of Sandy Spring Bancorp is set forth in the proxy statement for Sandy Spring Bancorp’s 2011 annual meeting of shareholders, as filed with the SEC on a Schedule 14A on March 28, 2011. Information about the directors and executive officers of CommerceFirst Bancorp is set forth in the proxy statement for CommerceFirst Bancorp’s 2011 annual meeting of shareholders, as filed with the SEC on a Schedule 14A on March 16, 2011. Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the Proxy Statement/Prospectus regarding the proposed merger when it becomes available. Free copies of this document may be obtained as described in the preceding paragraph.

 

 

Conference Call

 

The Company’s management will host a conference call to discuss its fourth quarter and full year results today at 2:00 P.M. (ET). A live Web cast of the conference call is available through the Investor Relations’ section of the Sandy Spring Web site at www.sandyspringbank.com. Participants may call 1-877-317-6789. A password is not necessary. Visitors to the Web site are advised to log on 10 minutes ahead of the scheduled start of the call. An internet-based replay will be available at the Web site until 9:00 am (ET) February 27, 2012. A replay of the teleconference will be available through the same time period by calling 1-877-344-7529 under conference call number 10008474.

 

About Sandy Spring Bancorp/Sandy Spring Bank

 

With $3.7 billion in assets, Sandy Spring Bancorp is the holding company for Sandy Spring Bank and its principal subsidiaries, Sandy Spring Insurance Corporation and West Financial Services, Inc. Sandy Spring Bancorp is the largest publicly traded banking company headquartered and operating in Maryland. Sandy Spring is a community banking organization that focuses its lending and other services on businesses and consumers in the local market area. Independent and community-oriented, Sandy Spring Bank was founded in 1868 and offers a broad range of commercial banking, retail banking and trust services through 43 community offices in Anne Arundel, Carroll, Frederick, Howard, Montgomery, and Prince George’s counties in Maryland, and Arlington, Fairfax and Loudoun counties in Virginia. Through its subsidiaries, Sandy Spring Bank also offers a comprehensive menu of insurance and investment management services. Visit www.sandyspringbank.com to locate an ATM near you or for more information about Sandy Spring Bank.

 

For additional information or questions, please contact:

Daniel J. Schrider, President & Chief Executive Officer, or

Philip J. Mantua, E.V.P. & Chief Financial Officer

Sandy Spring Bancorp

17801 Georgia Avenue

Olney, Maryland 20832

1-800-399-5919

Email:	DSchrider@sandyspringbank.com
	PMantua@sandyspringbank.com

Web site: www.sandyspringbank.com

 

Forward-Looking Statements

 

Sandy Spring Bancorp makes forward-looking statements in this news release and in the conference call regarding this news release. These forward-looking statements may include: statements of goals, intentions, earnings expectations, and other expectations; estimates of risks and of future costs and benefits; assessments of probable loan and lease losses; assessments of market risk; and statements of the ability to achieve financial and other goals.

 

 

Forward-looking statements are typically identified by words such as “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project” and other similar words and expressions. Forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made. Sandy Spring Bancorp does not assume any duty and does not undertake to update its forward-looking statements. Because forward-looking statements are subject to assumptions and uncertainties, actual results or future events could differ, possibly materially, from those that Sandy Spring Bancorp anticipated in its forward-looking statements and future results could differ materially from historical performance.

 

Sandy Spring Bancorp’s forward-looking statements are subject to the following principal risks and uncertainties: general economic conditions and trends, either nationally or locally; conditions in the securities markets; changes in interest rates; changes in deposit flows, and in the demand for deposit, loan, and investment products and other financial services; changes in real estate values; changes in the quality or composition of the Company’s loan or investment portfolios; changes in competitive pressures among financial institutions or from non-financial institutions; the Company’s ability to retain key members of management; changes in legislation, regulations, and policies; and a variety of other matters which, by their nature, are subject to significant uncertainties. Sandy Spring Bancorp provides greater detail regarding some of these factors in its Form 10-K for the year ended December 31, 2010, including in the Risk Factors section of that report, and in its other SEC reports. Sandy Spring Bancorp’s forward-looking statements may also be subject to other risks and uncertainties, including those that it may discuss elsewhere in this news release or in its filings with the SEC, accessible on the SEC’s Web site at www.sec.gov.

 

 

Sandy Spring Bancorp, Inc. and Subsidiaries

FINANCIAL HIGHLIGHTS - UNAUDITED 

 

		Three Months Ended												Twelve Months Ended
		December 31,								%				December 31,								%
(Dollars in thousands, except per share data)		2011				2010				Change				2011				2010				Change
Results of Operations:
Net interest income		$	28,452			$	28,953				(2	)%		$	112,946			$	115,607				(2	)%
Provision for loan and lease losses			2,282				2,323				(2	)			1,428				25,908				(94	)
Non-interest income			11,370				11,722				(3	)			43,500				43,782				(1	)
Non-interest expenses			27,323				26,201				4				105,071				100,912				4
Income before income taxes			10,217				12,151				(16	)			49,947				32,569				53
Net income			7,258				8,276				(12	)			34,102				23,520				45
Net income available to common stockholders		$	7,258			$	6,604				10			$	34,102			$	17,371				96
Return on average assets (1)			0.79	%			0.73	%							0.95	%			0.48	%
Return on average common equity (1)			6.54	%			6.34	%							8.07	%			4.56	%
Net interest margin			3.51	%			3.61	%							3.57	%			3.60	%
Efficiency ratio - GAAP (3)			68.61	%			64.42	%							67.16	%			63.31	%
Efficiency ratio - Non-GAAP (3)			65.10	%			61.85	%							63.75	%			60.36	%
Per share data:
Basic net income		$	0.30			$	0.34				(12	)%		$	1.42			$	1.05				35	%
Basic net income per common share			0.30				0.27				11				1.42				0.78				82
Diluted net income			0.30				0.34				(12	)			1.41				1.05				34
Diluted net income per common share			0.30				0.27				11				1.41				0.78				81
Average fully diluted shares			24,141,084				24,087,482				—				24,149,205				22,380,135				8
Dividends declared per common share			0.10				0.01				—				0.34				0.04				—
Book value per common share			18.52				16.95				9				18.52				16.95				9
Tangible book value per common share			14.58				13.59				7				14.58				13.59				7
Outstanding Common Shares			24,091,042				24,046,627				—				24,091,042				24,046,627				—
Financial Condition at period-end:
Investment securities		$	1,164,699			$	1,042,943				12	%		$	1,164,699			$	1,042,943				12	%
Loans and leases			2,239,692				2,156,232				4				2,239,692				2,156,232				4
Interest-earning assets			3,452,214				3,240,313				7				3,452,214				3,240,313				7
Assets			3,711,370				3,519,388				5				3,711,370				3,519,388				5
Deposits			2,656,520				2,549,872				4				2,656,520				2,549,872				4
Interest-bearing liabilities			2,590,164				2,520,061				3				2,590,164				2,520,061				3
Stockholders' equity			446,109				407,569				9				446,109				407,569				9
Capital ratios:
Tier 1 leverage			10.84	%			10.30	%							10.84	%			10.30	%
Tier 1 capital to risk-weighted assets			14.57	%			14.11	%							14.57	%			14.11	%
Total regulatory capital to risk-weighted assets			15.83	%			15.37	%							15.83	%			15.37	%
Tangible common equity to tangible assets (4)			9.68	%			9.51	%							9.68	%			9.51	%
Average equity to average assets			12.07	%			12.41	%							11.80	%			12.21	%
Credit quality ratios:
Allowance for loan and lease losses to loans and leases			2.21	%			2.88	%							2.21	%			2.88	%
Non-performing loans to total loans			3.53	%			4.08	%							3.53	%			4.08	%
Non-performing assets to total assets			2.25	%			2.78	%							2.25	%			2.78	%
Allowance for loan and lease losses to non-performing loans			62.46	%			70.57	%							62.46	%			70.57	%
Annualized net charge-offs to average loans and leases (2)			0.47	%			1.37	%							0.66	%			1.27	%

   

(1)	Calculation utilizes net income available to common stockholders.
(2)	Calculation utilizes average loans and leases, excluding residential mortgage loans held-for-sale.
(3)	The GAAP efficiency ratio is non-interest expenses divided by net interest income plus non-interest income from the Consolidated Statements of Income. The traditional, non-GAAP efficiency ratio excludes intangible asset amortization from non-interest expense; securities gains (losses) from non-interest income; OTTI; and adds the tax-equivalent adjustment to net interest income.  See the Reconciliation Table included with these Financial Highlights.
(4)	The tangible common equity to tangible assets ratio is a non-GAAP ratio that divides assets excluding intangible assets into stockholders' equity after deducting intangible assets, other comprehensive losses and preferred stock.  See the Reconciliation Table included with these Financial Highlights.

 

 

Sandy Spring Bancorp, Inc. and Subsidiaries

RECONCILIATION TABLE - UNAUDITED

  

		Three Months Ended								Twelve Months Ended
		December 31,								December 31,
(Dollars in thousands)		2011				2010				2011				2010
GAAP efficiency ratio:
Non-interest expenses		$	27,323			$	26,201			$	105,071			$	100,912
Net interest income plus non-interest income		$	39,822			$	40,675			$	156,446			$	159,389
Efficiency ratio–GAAP			68.61	%			64.42	%			67.16	%			63.31	%
Non-GAAP efficiency ratio:
Non-interest expenses		$	27,323			$	26,201			$	105,071			$	100,912
Less non-GAAP adjustment:
Amortization of intangible assets			461				472				1,845				1,959
Non-interest expenses as adjusted		$	26,862			$	25,729			$	103,226			$	98,953
Net interest income plus non-interest income		$	39,822			$	40,675			$	156,446			$	159,389
Plus non-GAAP adjustment:
Tax-equivalent income			1,448				1,352				5,602				4,836
Less non-GAAP adjustments:
Securities gains			9				473				292				796
OTTI recognized in earnings			—				(43	)			(160	)			(512	)
Net interest income plus non-interest income - as adjusted		$	41,261			$	41,597			$	161,916			$	163,941
Efficiency ratio–Non-GAAP			65.10	%			61.85	%			63.75	%			60.36	%
Tangible common equity ratio:
Total stockholders' equity		$	446,109			$	407,569			$	446,109			$	407,569
Accumulated other comprehensive income			(13,248	)			2,620				(13,248	)			2,620
Goodwill			(76,816	)			(76,816	)			(76,816	)			(76,816	)
Other intangible assets, net			(4,734	)			(6,578	)			(4,734	)			(6,578	)
Tangible common equity		$	351,311			$	326,795			$	351,311			$	326,795
Total assets		$	3,711,370			$	3,519,388			$	3,711,370			$	3,519,388
Goodwill			(76,816	)			(76,816	)			(76,816	)			(76,816	)
Other intangible assets, net			(4,734	)			(6,578	)			(4,734	)			(6,578	)
Tangible assets		$	3,629,820			$	3,435,994			$	3,629,820			$	3,435,994
Tangible common equity ratio			9.68	%			9.51	%			9.68	%			9.51	%
Outstanding Common Shares			24,091,042				24,046,627				24,091,042				24,046,627
Tangible book value per common share		$	14.58			$	13.59			$	14.58			$	13.59

 

 

Sandy Spring Bancorp, Inc. and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF CONDITION - UNAUDITED

 

		December 31,
(Dollars in thousands)		2011				2010
Assets
Cash and due from banks		$	49,832			$	44,696
Federal funds sold			1,006				1,813
Interest-bearing deposits with banks			21,476				16,608
Cash and cash equivalents			72,314				63,117
Residential mortgage loans held for sale (at fair value)			25,341				22,717
Investments available-for-sale (at fair value)			951,301				907,283
Investments held-to-maturity — fair value of $184,167 and $104,124 at December 31, 2011 and December 31, 2010, respectively			178,465				101,590
Other equity securities			34,933				34,070
Total loans and leases			2,239,692				2,156,232
Less: allowance for loan and lease losses			(49,426	)			(62,135	)
Net loans and leases			2,190,266				2,094,097
Premises and equipment, net			48,483				49,004
Other real estate owned			4,431				9,493
Accrued interest receivable			12,898				12,570
Goodwill			76,816				76,816
Other intangible assets, net			4,734				6,578
Other assets			111,388				142,053
Total assets		$	3,711,370			$	3,519,388
Liabilities
Noninterest-bearing deposits		$	650,377			$	566,812
Interest-bearing deposits			2,006,143				1,983,060
Total deposits			2,656,520				2,549,872
Securities sold under retail repurchase agreements and federal funds purchased			143,613				96,243
Advances from FHLB			405,408				405,758
Subordinated debentures			35,000				35,000
Accrued interest payable and other liabilities			24,720				24,946
Total liabilities			3,265,261				3,111,819
Stockholders' Equity
Common stock — par value $1.00; shares authorized 50,000,000; shares issued and outstanding 24,091,042 and 24,046,627 at December 31, 2011 and 2010, respectively			24,091				24,047
Warrants			—				3,699
Additional paid in capital			177,828				177,344
Retained earnings			230,942				205,099
Accumulated other comprehensive income (loss)			13,248				(2,620	)
Total stockholders' equity			446,109				407,569
Total liabilities and stockholders' equity		$	3,711,370			$	3,519,388

 

 

 

Sandy Spring Bancorp, Inc. and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

 

		Three Months Ended								Twelve Months Ended
		December 31,								December 31,
(Dollars in thousands, except per share data)		2011				2010				2011				2010
Interest Income:
Interest and fees on loans and leases		$	26,758			$	28,047			$	107,355			$	115,789
Interest on loans held for sale			189				213				577				534
Interest on deposits with banks			15				19				77				177
Interest and dividends on investment securities:
Taxable			5,314				5,984				22,096				24,624
Exempt from federal income taxes			2,431				1,850				9,363				7,222
Interest on federal funds sold			1				1				2				3
Total interest income			34,708				36,114				139,470				148,349
Interest Expense:
Interest on deposits			2,329				3,193				11,002				16,934
Interest on retail repurchase agreements and federal funds purchased			57				71				212				269
Interest on advances from FHLB			3,628				3,650				14,397				14,599
Interest on subordinated debt			242				247				913				940
Total interest expense			6,256				7,161				26,524				32,742
Net interest income			28,452				28,953				112,946				115,607
Provision for loan and lease losses			2,282				2,323				1,428				25,908
Net interest income after provision for loan and lease losses			26,170				26,630				111,518				89,699
Non-interest Income:
Investment securities gains			9				473				292				796
Total other-than-temporary impairment ("OTTI") losses			-				(337	)			(178	)			(1,505	)
Portion of OTTI losses recognized in other comprehensive income, before taxes			-				294				18				993
Net OTTI recognized in earnings			-				(43	)			(160	)			(512	)
Service charges on deposit accounts			2,394				2,342				9,527				10,326
Mortgage banking activities			824				914				3,228				3,664
Fees on sales of investment products			935				974				3,703				3,438
Trust and investment management fees			3,106				2,799				11,943				10,287
Insurance agency commissions			1,473				1,334				4,650				5,229
Income from bank owned life insurance			674				695				2,636				2,800
Visa check fees			927				887				3,637				3,325
Other income			1,028				1,347				4,044				4,429
Total non-interest income			11,370				11,722				43,500				43,782
Non-interest Expenses:
Salaries and employee benefits			15,433				14,077				59,625				55,470
Occupancy expense of premises			2,802				2,852				11,519				11,477
Equipment expenses			1,292				1,153				4,705				4,808
Marketing			727				681				2,389				2,359
Outside data services			1,092				985				4,159				3,992
FDIC insurance			698				1,114				3,187				4,497
Amortization of intangible assets			461				472				1,845				1,959
Other expenses			4,818				4,867				17,642				16,350
Total non-interest expenses			27,323				26,201				105,071				100,912
Income before income taxes			10,217				12,151				49,947				32,569
Income tax expense			2,959				3,875				15,845				9,049
Net income		$	7,258			$	8,276			$	34,102			$	23,520
Preferred stock dividends and discount accretion			—				1,672				—				6,149
Net income available to common stockholders		$	7,258			$	6,604			$	34,102			$	17,371
Net Income Per Share Amounts:
Basic net income per share		$	0.30			$	0.34			$	1.42			$	1.05
Basic net income per common share			0.30				0.27				1.42				0.78
Diluted net income per share		$	0.30			$	0.34			$	1.41			$	1.05
Diluted net income per common share			0.30				0.27				1.41				0.78
Dividends declared per common share		$	0.10			$	0.01			$	0.34			$	0.04

 

 

 

Sandy Spring Bancorp, Inc. and Subsidiaries

HISTORICAL TRENDS - QUARTERLY FINANCIAL DATA - UNAUDITED

   

		2011																2010
(Dollars in thousands, except per share data)		Q4				Q3				Q2				Q1				Q4				Q3				Q2				Q1
Profitability for the quarter:
Tax-equivalent interest income		$	36,156			$	36,424			$	36,435			$	36,057			$	37,466			$	38,688			$	38,663			$	38,368
Interest expense			6,256				6,674				6,854				6,740				7,161				7,868				8,512				9,201
Tax-equivalent net interest income			29,900				29,750				29,581				29,317				30,305				30,820				30,151				29,167
Tax-equivalent adjustment			1,448				1,420				1,427				1,307				1,352				1,321				1,155				1,008
Provision for loan and lease losses			2,282				(3,520	)			1,151				1,515				2,323				2,453				6,107				15,025
Non-interest income			11,370				11,336				10,802				9,992				11,722				10,539				10,674				10,847
Non-interest expenses			27,323				25,848				25,838				26,062				26,201				25,140				24,758				24,813
Income (loss) before income taxes			10,217				17,338				11,967				10,425				12,151				12,445				8,805				(832	)
Income (loss) tax expense			2,959				6,081				3,671				3,134				3,875				3,961				2,546				(1,333	)
Net income			7,258				11,257				8,296				7,291				8,276				8,484				6,259				501
Net income (loss) available to common stockholders		$	7,258			$	11,257			$	8,296			$	7,291			$	6,604			$	6,410			$	5,056			$	(699	)
Financial ratios:
Return on average assets			0.79	%			1.24	%			0.93	%			0.84	%			0.73	%			0.70	%			0.56	%			(0.08	)%
Return on average common equity			6.54	%			10.42	%			8.03	%			7.26	%			6.34	%			6.26	%			5.13	%			(0.92	)%
Return on average tangible common equity			8.04	%			12.90	%			10.03	%			9.13	%			9.06	%			9.08	%			6.42	%			0.67	%
Net interest margin			3.51	%			3.53	%			3.58	%			3.65	%			3.61	%			3.64	%			3.58	%			3.56	%
Efficiency ratio - GAAP (1)			68.61	%			65.16	%			66.33	%			68.58	%			64.42	%			62.79	%			62.41	%			63.61	%
Efficiency ratio - Non-GAAP (1)			65.10	%			62.02	%			62.82	%			65.09	%			61.85	%			59.08	%			59.44	%			61.08	%
Per share data:
Basic net income per share		$	0.30			$	0.47			$	0.34			$	0.30			$	0.34			$	0.35			$	0.26			$	0.03
Basic net income (loss) per common share			0.30				0.47				0.34				0.30				0.27				0.27				0.21				(0.04	)
Diluted net income per share			0.30				0.47				0.34				0.30				0.34				0.35				0.26				0.03
Diluted net income (loss) per common share			0.30				0.47				0.34				0.30				0.27				0.27				0.21				(0.04	)
Average fully diluted shares			24,141,084				24,142,137				24,130,357				24,115,906				24,087,482				24,102,497				24,033,158				17,243,415
Dividends declared per common share		$	0.10			$	0.08			$	0.08			$	0.08			$	0.01			$	0.01			$	0.01			$	0.01
Non-interest income:
Securities gains		$	9			$	231			$	32			$	20			$	473			$	25			$	95			$	203
Net OTTI recognized in earnings			-				(76	)			(43	)			(41	)			(43	)			(380	)			(89	)			-
Service charges on deposit accounts			2,394				2,444				2,437				2,252				2,342				2,567				2,791				2,626
Mortgage banking activities			824				1,141				808				455				914				1,516				806				428
Fees on sales of investment products			935				905				1,005				858				974				782				941				741
Trust and investment management fees			3,106				3,032				3,018				2,787				2,799				2,505				2,534				2,449
Insurance agency commissions			1,473				1,044				953				1,180				1,334				978				928				1,989
Income from bank owned life insurance			674				662				654				646				695				709				703				693
Visa check fees			927				927				949				834				887				843				855				740
Other income			1,028				1,026				989				1,001				1,347				994				1,110				978
Total non-interest income		$	11,370			$	11,336			$	10,801			$	9,992			$	11,722			$	10,539			$	10,674			$	10,847
Non-interest expense:
Salaries and employee benefits		$	15,433			$	14,892			$	14,676			$	14,624			$	14,077			$	13,841			$	14,181			$	13,371
Occupancy expense of premises			2,802				2,784				2,790				3,143				2,852				2,826				2,709				3,090
Equipment expenses			1,292				1,143				1,128				1,142				1,153				1,137				1,304				1,214
Marketing			727				468				709				485				681				589				573				516
Outside data services			1,092				1,073				999				995				985				966				918				1,123
FDIC insurance			698				709				736				1,044				1,114				1,056				1,186				1,141
Amortization of intangible assets			461				461				462				461				472				495				496				496
Professional fees			1,414				1,314				1,088				1,126				1,842				1,337				1,189				1,218
Other real estate owned expenses			604				383				726				699				443				236				(55	)			352
Other expenses			2,800				2,621				2,524				2,343				2,582				2,657				2,257				2,292
Total non-interest expense		$	27,323			$	25,848			$	25,838			$	26,062			$	26,201			$	25,140			$	24,758			$	24,813

 

(1) The GAAP efficiency ratio is non-interest expenses divided by net interest income plus non-interest income from the Consolidated Statements of Income. The traditional, non-GAAP efficiency ratio excludes intangible asset amortization from non-interest expense; excludes securities gains; OTTI losses from non-interest income; and adds the tax-equivalent adjustment to net interest income. See the Reconciliation Table included with these Financial Highlights.

  

  

Sandy Spring Bancorp, Inc. and Subsidiaries

HISTORICAL TRENDS - QUARTERLY FINANCIAL DATA - UNAUDITED

   

		2011																2010
(Dollars in thousands)		Q4				Q3				Q2				Q1				Q4				Q3				Q2				Q1
Balance sheets at quarter end:
Residential mortgage loans		$	448,662			$	440,606			$	445,605			$	444,519			$	436,534			$	442,723			$	458,502			$	460,129
Residential construction loans			108,699				90,727				81,425				84,939				91,273				92,485				86,393				83,902
Commercial ADC loans			160,946				141,576				149,215				151,135				151,061				153,139				155,751				177,498
Commercial investor real estate loans			371,948				357,358				353,749				355,967				327,782				335,426				328,244				316,336
Commercial owner occupied real estate loans			522,076				519,837				511,271				509,215				503,286				511,453				511,673				518,271
Commercial business loans			260,327				226,528				225,624				231,448				250,255				240,671				263,886				279,520
Leasing			6,954				8,484				10,200				12,477				15,551				17,895				20,823				23,474
Consumer loans			360,080				360,287				360,831				360,349				380,490				391,415				393,560				397,527
Total loans and leases			2,239,692				2,145,403				2,137,920				2,150,049				2,156,232				2,185,207				2,218,832				2,256,657
Allowance for loan and lease losses			(49,426	)			(49,720	)			(55,246	)			(58,918	)			(62,135	)			(67,282	)			(71,377	)			(69,575	)
Investment securities			1,164,699				1,174,180				1,128,589				1,087,620				1,042,943				1,099,518				1,062,541				985,966
Interest-earning assets			3,452,214				3,370,360				3,322,317				3,283,819				3,240,313				3,343,173				3,437,731				3,401,162
Total assets			3,711,370				3,626,043				3,612,013				3,549,533				3,519,388				3,606,617				3,701,150				3,673,246
Noninterest-bearing demand deposits			650,377				643,169				648,605				619,905				566,812				580,309				593,007				560,027
Total deposits			2,656,520				2,640,324				2,657,861				2,599,634				2,549,872				2,585,496				2,659,956				2,653,448
Customer repurchase agreements			63,613				79,529				65,214				75,516				86,243				97,884				86,062				78,416
Total interest-bearing liabilities			2,590,164				2,517,180				2,515,053				2,495,916				2,520,061				2,547,334				2,597,445				2,618,178
Total stockholders' equity			446,109				440,791				423,984				409,076				407,569				451,717				483,681				471,857
Quarterly average balance sheets:
Residential mortgage loans		$	463,754			$	453,645			$	455,803			$	458,329			$	461,700			$	466,437			$	467,970			$	462,803
Residential construction loans			99,983				89,128				84,144				85,891				92,033				87,522				85,617				89,732
Commercial ADC loans			153,598				145,835				149,773				149,071				155,795				154,863				165,510				182,918
Commercial investor real estate loans			353,975				350,925				352,668				340,008				330,717				335,279				324,717				317,671
Commercial owner occupied real estate loans			521,212				515,185				509,273				500,875				505,248				512,370				512,997				522,398
Commercial business loans			231,773				225,041				225,646				236,949				240,083				253,058				271,839				292,844
Leasing			7,671				9,269				11,154				14,009				16,562				19,295				22,329				24,648
Consumer loans			361,888				360,875				362,098				367,261				387,375				393,491				395,833				398,233
Total loans and leases			2,193,854				2,149,903				2,150,559				2,152,393				2,189,513				2,222,315				2,246,812				2,291,247
Investment securities			1,173,418				1,168,712				1,121,325				1,054,740				1,112,128				1,058,175				1,013,756				970,681
Total earning assets			3,392,773				3,355,937				3,305,059				3,237,556				3,332,705				3,360,758				3,379,388				3,318,070
Total assets			3,647,291				3,610,219				3,566,278				3,500,807				3,594,812				3,620,881				3,645,090				3,591,786
Noninterest-bearing demand deposits			655,381				631,192				607,092				582,441				587,570				568,835				547,245				524,313
Total deposits			2,658,676				2,640,729				2,607,854				2,548,117				2,584,025				2,607,190				2,612,633				2,640,853
Customer repurchase agreements			74,267				72,646				70,313				79,067				92,049				87,927				85,178				81,622
Total interest-bearing liabilities			2,525,128				2,524,728				2,519,114				2,485,451				2,534,716				2,571,000				2,596,353				2,653,187
Total stockholders' equity			440,154				428,511				414,624				407,007				446,256				455,101				475,521				387,099
Capital measures:
Average equity to average assets			12.07	%			11.87	%			11.63	%			11.63	%			12.41	%			12.57	%			13.05	%			10.78	%
Tier 1 leverage			10.84	%			10.79	%			10.64	%			10.63	%			10.30	%			11.15	%			12.00	%			12.01	%
Tier 1 capital to risk-weighted assets			14.57	%			14.96	%			14.75	%			14.21	%			14.11	%			15.29	%			16.50	%			15.77	%
Total regulatory capital to risk-weighted assets			15.83	%			16.21	%			16.01	%			15.48	%			15.37	%			16.56	%			17.77	%			17.04	%
Book value per common share		$	18.52			$	18.31			$	17.58			$	16.99			$	16.95			$	17.14			$	16.80			$	16.33
Outstanding common shares			24,091,042				24,079,204				24,095,123				24,084,423				24,046,627				24,006,748				23,998,950				23,985,149

  

 

Sandy Spring Bancorp, Inc. and Subsidiaries

LOAN PORTFOLIO QUALITY DETAIL - UNAUDITED

  

		2011																2010
(dollars in thousands)		December 31,				September 30,				June 30,				March 31,				December 31,				September 30,				June 30,				March 31,
Non-Performing Assets:
Loans and leases 90 days past due:
Commercial business		$	-			$	-			$	-			$	-			$	19			$	56			$	357			$	3,829
Commercial real estate:
Commercial AD&C			-				-				-				-				-				-				-				-
Commercial investor real estate			-				-				-				-				-				944				-				-
Commercial owner occupied real estate			-				-				-				-				-				317				160				-
Leasing			2				63				20				24				407				409				582				163
Consumer			165				373				337				169				182				550				745				848
Residential real estate:
Residential mortgage			167				2,291				3,820				4,616				9,871				12,545				18,131				16,879
Residential construction			243				-				-				2,367				3,675				3,447				4,251				3,366
Total loans and leases 90 days past due			577				2,727				4,177				7,176				14,154				18,268				24,226				25,085
Non-accrual loans and leases:
Commercial business			7,226				8,038				8,288				9,649				7,938				10,747				14,512				17,600
Commercial real estate:
Commercial AD&C			18,702				24,481				26,133				28,310				30,417				44,175				47,341				72,021
Commercial investor real estate			16,963				16,118				2,975				2,519				1,753				1,160				1,160				1,171
Commercial owner occupied real estate			14,709				11,847				13,019				12,304				11,781				10,197				11,620				9,327
Leasing			853				956				1,017				1,529				1,887				1,903				1,621				1,472
Consumer			1,786				1,478				590				720				300				20				227				604
Residential real estate:
Residential mortgage			5,722				6,081				6,295				6,652				3,946				2,149				3,011				4,120
Residential construction			5,719				5,034				5,701				5,222				5,305				3,525				4,395				4,404
Total non-accrual loans and lease			71,680				74,033				64,018				66,905				63,327				73,876				83,887				110,719
Total restructured loans - accruing			6,881				6,088				8,299				14,266				10,571				1,199				1,199				682
Total non-performing loans and leases			79,138				82,848				76,494				88,347				88,052				93,343				109,312				136,486
Other assets and real estate owned (OREO)			4,431				7,938				6,951				7,960				9,493				10,011				8,730				6,796
Other assets owned			-				-				-				-				200				200				-				-
Total non-performing assets		$	83,569			$	90,786			$	83,445			$	96,307			$	97,745			$	103,554			$	118,042			$	143,282

 

		For the quarter ended,
		December 31,				September 30,				June 30,				March 31,				December 31,				September 30,				June 30,				March 31,
(dollars in thousands)		2011				2011				2011				2011				2010				2010				2010				2010
Analysis of non-accrual loan and lease activity
Balance at beginning of period		$	74,033			$	64,018			$	66,905			$	63,327			$	73,876			$	83,887			$	110,719			$	111,181
Non-accrual balances transferred to OREO			(511	)			(142	)			(791	)			(535	)			(222	)			(1,119	)			(540	)			(1,982	)
Non-accrual balances charged-off			(2,758	)			(1,375	)			(2,112	)			(2,701	)			(7,288	)			(3,664	)			(4,599	)			(8,642	)
Net payments or draws			(6,724	)			(4,839	)			(8,016	)			(2,531	)			(16,191	)			(4,288	)			(25,043	)			(2,179	)
Loans placed on non-accrual			8,640				17,226				8,032				9,526				13,152				2,656				5,640				12,537
Non-accrual loans brought current			(1,000	)			(855	)			-				(181	)			-				(3,596	)			(2,290	)			(196	)
Balance at end of period		$	71,680			$	74,033			$	64,018			$	66,905			$	63,327			$	73,876			$	83,887			$	110,719
Analysis of Allowance for Loan Losses:
Balance at beginning of period		$	49,720			$	55,246			$	58,918			$	62,135			$	67,282			$	71,377			$	69,575			$	64,559
Provision for loan and lease losses			2,282				(3,520	)			1,151				1,515				2,323				2,453				6,107				15,025
Less loans charged-off, net of recoveries:
Commercial business			(65	)			397				769				790				1,651				1,469				(1,325	)			2,395
Commercial real estate:
Commercial AD&C			275				151				253				(137	)			2,990				1,923				2,656				4,914
Commercial investor real estate			335				30				504				(4	)			231				(1	)			-				-
Commercial owner occupied real estate			329				45				113				-				464				164				515				544
Leasing			181				85				455				333				3				-				98				2
Consumer			352				375				713				1,091				610				642				947				1,072
Residential real estate:
Residential mortgage			792				751				1,319				2,095				1,396				2,170				1,333				793
Residential construction			377				172				697				564				125				181				81				289
Net charge-offs			2,576				2,006				4,823				4,732				7,470				6,548				4,305				10,009
Balance at end of period		$	49,426			$	49,720			$	55,246			$	58,918			$	62,135			$	67,282			$	71,377			$	69,575
Asset Quality Ratios:
Non-performing loans to total loans			3.53	%			3.86	%			3.58	%			4.11	%			4.08	%			4.27	%			4.93	%			6.05	%
Non-performing assets to total assets			2.25	%			2.50	%			2.31	%			2.71	%			2.78	%			2.87	%			3.19	%			3.90	%
Allowance for loan losses to loans			2.21	%			2.32	%			2.58	%			2.74	%			2.88	%			3.08	%			3.22	%			3.08	%
Allowance for loan losses to non-performing loans			62.46	%			60.01 %				72.22 %				66.69 %				70.57	%			72.08	%			65.30	%			50.98	%
Net charge-offs in quarter to average loans			0.47	%			0.37	%			0.90	%			0.89	%			1.37	%			1.18	%			0.77	%			1.78	%

   

 

Sandy Spring Bancorp, Inc. and Subsidiaries

CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES - UNAUDITED

  

		Three Months Ended December 31,
		2011												2010
										Annualized												Annualized
		Average				(1)				Average				Average				(1)				Average
(Dollars in thousands and tax-equivalent)		Balances				Interest				Yield/Rate				Balances				Interest				Yield/Rate
Assets
Residential mortgage loans (3)		$	463,754			$	5,224				4.53	%		$	461,700			$	5,849				5.09	%
Residential construction loans			99,983				962				3.82				92,033				993				4.28
Commercial ADC loans			153,598				2,006				5.18				155,795				1,809				4.61
Commercial investor real estate loans			353,975				4,977				5.53				330,717				4,956				5.95
Commercial owner occupied real estate loans			521,212				7,511				5.75				505,248				7,572				5.95
Commercial business loans			231,773				2,851				4.88				240,084				3,080				5.33
Leasing			7,671				131				6.83				16,561				275				6.66
Consumer loans			361,888				3,285				3.62				387,375				3,726				3.84
Total loans and leases (2)			2,193,854				26,947				4.89				2,189,513				28,260				5.13
Taxable securities			902,211				5,661				2.51				934,784				6,403				2.68
Tax-exempt securities (4)			271,207				3,532				5.21				177,344				2,783				6.28
Interest-bearing deposits with banks			24,374				15				0.25				29,410				19				0.26
Federal funds sold			1,127				1				0.12				1,654				1				0.18
Total interest-earning assets			3,392,773				36,156				4.24				3,332,705				37,466				4.46
Less:  allowance for loan and lease losses			(51,126	)											(67,164	)
Cash and due from banks			46,121												45,042
Premises and equipment, net			48,800												48,326
Other assets			210,723												235,903
Total assets		$	3,647,291											$	3,594,812
Liabilities and Stockholders' Equity
Interest-bearing demand deposits		$	352,244				86				0.10	%		$	302,401				68				0.09	%
Regular savings deposits			188,877				41				0.09				169,021				36				0.08
Money market savings deposits			871,923				682				0.31				882,323				1,009				0.45
Time deposits			590,250				1,520				1.02				642,710				2,080				1.28
Total interest-bearing deposits			2,003,294				2,329				0.46				1,996,455				3,193				0.63
Other borrowings			81,387				57				0.27				96,016				71				0.30
Advances from FHLB			405,447				3,628				3.55				407,245				3,650				3.56
Subordinated debentures			35,000				242				2.77				35,000				247				2.82
Total interest-bearing liabilities			2,525,128				6,256				0.98				2,534,716				7,161				1.12
Noninterest-bearing demand deposits			655,381												587,570
Other liabilities			26,628												26,270
Stockholders' equity			440,154												446,256
Total liabilities and stockholders' equity		$	3,647,291											$	3,594,812
Net interest income and spread						$	29,900				3.26	%						$	30,305				3.34	%
Less: tax-equivalent adjustment							1,448												1,352
Net interest income						$	28,452											$	28,953
Interest income/earning assets											4.24	%											4.46	%
Interest expense/earning assets											0.73												0.85
Net interest margin											3.51	%											3.61	%

   

(1)	Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 39.88% for 2011 and  2010. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to $1.4 million and $1.4 million in 2011 and 2010, respectively.
(2)	Non-accrual loans are included in the average balances.
(3)	Includes residential mortgage loans held for sale. Home equity loans and lines are classified as consumer loans.
(4)	Includes only investments that are exempt from federal taxes.

  

 

Sandy Spring Bancorp, Inc. and Subsidiaries

CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES - UNAUDITED

 

		Twelve Months Ended December 31,
		2011												2010
										Annualized												Annualized
		Average				(1)				Average				Average				(1)				Average
(Dollars in thousands and tax-equivalent)		Balances				Interest				Yield/Rate				Balances				Interest				Yield/Rate
Assets
Residential mortgage loans (3)		$	457,886			$	21,971				4.80	%		$	464,462			$	24,838				5.35	%
Residential construction loans			89,823				3,410				3.80				88,729				4,037				4.55
Commercial ADC loans			149,571				6,819				4.56				157,879				6,459				4.09
Commercial investor real estate loans			349,447				20,213				5.78				335,141				20,174				6.02
Commercial owner occupied real estate loans			511,692				30,197				5.90				512,008				30,820				6.02
Commercial business loans			229,825				11,344				4.94				264,281				13,329				5.04
Leasing			10,505				707				6.73				20,682				1,460				7.06
Consumer loans			363,010				13,271				3.68				393,703				15,206				3.88
Total loans and leases (2)			2,161,759				107,932				5.00				2,236,885				116,323				5.20
Taxable securities			885,023				23,471				2.65				875,292				25,630				2.93
Tax-exempt securities (4)			244,958				13,590				5.55				163,834				11,052				6.75
Interest-bearing deposits with banks			30,270				77				0.25				69,755				177				0.25
Federal funds sold			1,337				2				0.14				1,773				3				0.17
Total interest-earning assets			3,323,347				145,072				4.37				3,347,539				153,185				4.58
Less:  allowance for loan and lease losses			(56,770	)											(69,393	)
Cash and due from banks			45,721												44,736
Premises and equipment, net			49,047												48,738
Other assets			220,221												241,368
Total assets		$	3,581,566											$	3,612,988
Liabilities and Stockholders' Equity
Interest-bearing demand deposits		$	340,110				364				0.11	%		$	292,106				324				0.11	%
Regular savings deposits			184,050				183				0.10				165,032				164				0.10
Money market savings deposits			859,608				3,547				0.41				890,187				5,015				0.56
Time deposits			611,192				6,908				1.13				706,487				11,431				1.62
Total interest-bearing deposits			1,994,960				11,002				0.55				2,053,812				16,934				0.82
Other borrowings			78,207				212				0.27				89,932				269				0.30
Advances from FHLB			405,577				14,397				3.55				409,697				14,599				3.56
Subordinated debentures			35,000				913				2.61				35,000				940				2.69
Total interest-bearing liabilities			2,513,744				26,524				1.06				2,588,441				32,742				1.27
Noninterest-bearing demand deposits			619,260												557,197
Other liabilities			25,881												26,155
Stockholders' equity			422,681												441,195
Total liabilities and stockholders' equity		$	3,581,566											$	3,612,988
Net interest income and spread						$	118,548				3.31	%						$	120,443				3.31	%
Less: tax-equivalent adjustment							5,602												4,836
Net interest income						$	112,946											$	115,607
Interest income/earning assets											4.37	%											4.58	%
Interest expense/earning assets											0.80												0.98
Net interest margin											3.57	%											3.60	%

 

(1)	Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 39.88% for 2011 and  2010. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to $5.6 million and $4.8 million in 2011 and 2010, respectively.
(2)	Non-accrual loans are included in the average balances.
(3)	Includes residential mortgage loans held for sale. Home equity loans and lines are classified as consumer loans.
(4)	Includes only investments that are exempt from federal taxes.

  

 

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The following information was filed by Sandy Spring Bancorp Inc (SASR) on Thursday, January 26, 2012 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-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.