Severn Bancorp adjusts 2Q14 earnings.
M2 EQUITYBITES-August 4, 2014--Severn Bancorp adjusts 2Q14 earnings
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4 August 2014 - Maryland US-based Severn Bancorp Inc (NASDAQ: SVBI) parent company of Severn Savings Bank FSB TODAY announced an adjustment to the earnings reported in a July 15 2014 earnings release.
The adjustment is for a USD 1.4m reserve being placed on certain standby letters of credit held by Severn, not previously reflected in the earnings statement.
According to the firm, the adjustment results in a change from net income of USD 824,000 or USD .02 per share for the 2Q14, to a net loss of USD 576,000 or (USD .12) per share.
This reserve is due to management's decision, based on consultation with its regulators, to place a reserve on certain unsecured standby letters of credit on the books as of June 30, 2014.
Standby letters of credit are conditional commitments issued by Severn guaranteeing performance by a customer to various municipalities.
Severn said it determined that a reserve against certain standby letters of credit was prudent due to insufficient collateral supporting these letters of credit as of June 30, 2014.
The firm said it is working on a resolution of this matter and it is anticipated that adequate collateral will be obtained to warrant the reversal of a majority of the reserve in the near future.
Founded in 1946, Severn is a full-service community bank offering a range of personal and commercial banking products as well as residential and commercial mortgage lending.
It has assets of approximately USD 790m and four branches located in Annapolis, Edgewater and Glen Burnie, Maryland.
Find out more at www.severnbank.com.
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|Publication:||M2 EquityBites (EQB)|
|Date:||Aug 4, 2014|
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