WILMINGTON, Del.--(BUSINESS WIRE)--The Bancorp, Inc. (NASDAQ: TBBK), a financial holding company, today reported financial results for the second quarter 2016.

Highlights

• Net interest income increased 23% to $20.9 million for the quarter ended June 30, 2016 compared to $17.0 million for the quarter ended June 30, 2015.
• Net interest margin increased to 2.73% for the quarter ended June 30, 2016 compared to 2.23% for the quarter ended June 30, 2015.
• Loans and continuing operations loans held for sale increased 30% to $1.62 billion at June 30, 2016 compared to $1.25 billion at June 30, 2015.
• Small Business Administration (“SBA”) loans increased 40% to $334.2 million from $239.2 million at June 30, 2015.
• Security backed lines of credit (“SBLOC”) increased 18% to $607.0 million from $512.3 million at June 30, 2015.
• Direct lease financing increased 42% to $315.6 million from $222.2 million at June 30, 2015.
• Prepaid card fee income increased 21% to $13.5 million for the quarter ended June 30, 2016 from $11.1 million for the quarter ended June 30, 2015.
• Gross dollar volume (“GDV”) (1) increased 14% to $11.4 billion for Q2 2016 from $10.0 billion for Q2 2015.
• Assets held for sale from discontinued operations decreased 17% from December 31, 2015 and 25% from June 30, 2015.
• The rate payable by us for average deposits and interest bearing liabilities of $3.77 billion in Q2 2016 was 0.32% with a rate of 0.11% for $1.87 billion of average prepaid card deposits.
• Book value per common share at June 30, 2016 of $7.67 per share. The Bancorp and its subsidiary, The Bancorp Bank, remain well capitalized.

The Bancorp reported a net loss of $31.4 million, or $0.83 loss per diluted share, for the quarter ended June 30, 2016 compared to net income of $174,000, or $0.00 net income per share, for the quarter ended June 30, 2015. Net loss from continuing operations for the quarter ended June 30, 2016 was $17.8 million or a loss of $0.47 per diluted share compared to net loss from continuing operations of $2.5 million or a loss of $0.07 per diluted share for the quarter ended June 30, 2015. Loss from continuing operations does not include any income which may result from the reinvestment of the proceeds from sales of the remaining $471.1 million of commercial and residential loans in The Bancorp’s discontinued operations. Tier one capital to assets, tier one capital to risk-weighted assets, total capital to risk-weighted assets and common equity-tier 1 ratios were 6.78%, 12.72%, 12.97% and 12.72% compared to well capitalized minimums of 5%, 8%, 10% and 6.5%.

Damian Kozlowski, The Bancorp’s Chief Executive Officer, said, “Upon joining Bancorp, I immediately began a process to create a new business plan that will sustain our revenue growth, lower our expenses, increase productivity and reduce earnings volatility from our portfolio. In addition, the plan will also be squarely focused on resolving any issues with our regulators and managing the overall risk of our institution. We hope to complete the plan by the end of the 3rd quarter and implement many parts of it by the end of 2016. Strong revenue growth continued this quarter, and our core lending businesses drove a 23% increase over prior year quarter net interest income. Our non-interest income reflected 21% growth in prepaid card fees to $13.5 million. Earnings were negatively impacted by continued high regulatory lookback expenses, as expected, and were further negatively impacted by loan charges on discontinued operations and charges relating to our retained interest in an unconsolidated entity. Lookback expenses totaled $13.4 million for the quarter. However, the lookback is substantially complete and we expect that lookback expense will be substantially less in the third quarter. Loan charges on discontinued operations were based on quarterly loan valuations by third party loan review companies and totaled $17 million in the quarter. Additional charges of $15 million against the investment in unconsolidated entity were also taken on the basis of third party review. That entity, in which we have a substantial retained interest, represents the financing of a portion of the sale of certain discontinued loans to an independent investor. Loan charges during the quarter partially reflected strategies to liquidate certain unique collateral and properties to expedite resolution as we continue to pursue sales of other discontinued loans. Credit losses in our continuing operations which we believe to be lower risk lines of business, continue to be very low.”

About The Bancorp

With operations in the US and Europe, The Bancorp, Inc. (NASDAQ: TBBK) is dedicated to serving the unique needs of non-bank financial service companies, ranging from entrepreneurial start-ups to those on the Fortune 500. The company’s chief financial institution, The Bancorp Bank (Member FDIC, Equal Housing Lender), has been repeatedly recognized in the payments industry as the Top Issuer of Prepaid Cards (US), a top merchant sponsor bank, and a top ACH originator. Specialized lending distinctions include National Preferred SBA Lender, a leading provider of securities-backed lines of credit, and one of the few bank-owned commercial leasing groups in the nation. For more information please visit www.thebancorp.com.