First Mariner earnings rise to $312,000, or 9 cents a share

Results reflect switch from growth to profit

April 18, 2001|By Bill Atkinson | Bill Atkinson,SUN STAFF

First Mariner Bancorp reported yesterday that it made $312,000 in the first quarter, marking its highest profit in that period since the company was started six years ago.

The company made 9 cents per diluted share in the quarter that ended March 31, up from 2 cents per diluted share in the corresponding period a year earlier.

Over the last year-and-a-half, First Mariner has slowed its blistering growth pace to focus on boosting profit, and the company says that it is seeing results.

"This was beyond our expectation," said Edwin F. Hale Sr., the Baltimore banking company's chairman and chief executive.

Shares of First Mariner fell 50 cents to close at $6 on the Nasdaq stock exchange.

Profit was propelled by a 12 percent increase in net interest income - profit largely derived from loans after interest is paid on deposits and borrowings - which rose to $5.4 million. Non-interest income - profit from service fees on deposits, mortgage banking revenue and ATM fees - increased 64 percent to $2.7 million.

In addition, loans increased 25 percent to $444 million and deposits increased 21 percent to $501 million. Expenses, which have grown in past quarters by more than 50 percent, were up 15 percent to $7.2 million.

"I think they are heading on the right track," said Collyn Bement Gilbert, a banking analyst at Ferris, Baker Watts Inc., the Baltimore brokerage. "It was a good quarter."

The 9 cent per share profit beat her estimate by 2 cents, she said.

Despite the improved results, First Mariner still lags peers in key profitability ratios, including return on average assets. It returned 0.19 percent on average assets in the quarter, compared with 0.03 percent in the first quarter a year earlier. In other words, First Mariner made 19 cents for every $100 in assets.

Banks on average make $1.16 for every $100 in assets, according to the Federal Deposit Insurance Corp., a bank regulatory and insurance agency.

Hale expects profitability ratios to keep improving. "We are getting the proper results, we expect it to continue," he said.

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