SOURCE: Chain Bridge Bancorp, Inc.

Chain Bridge Bancorp, Inc.

February 09, 2012 07:00 ET

Chain Bridge Bancorp, Inc. and Chain Bridge Bank, N.A. Earnings Release 2011

MCLEAN, VA--(Marketwire - Feb 9, 2012) - Chain Bridge Bancorp, Inc. and its subsidiary, Chain Bridge Bank, National Association (the "Bank"), today reported that its average total assets rose by 14% in 2011, that it ended the year with zero ($0) past-due loans and that it earned net income of $2.4 million in 2011, up from $2.1 million in 2010.

Return on average assets was 1.08% and return on average equity was 10.66% in 2011, compared to 1.08% and 10.68%, respectively, in 2010.

Net interest income on a fully taxable equivalent basis was $8.6 million in 2011, up from $7.4 million in 2010. The Bank realized net securities gains of $181 thousand in 2011, down from $671 thousand in 2010.

Growth

Average total assets increased by $28 million, or 14%, from $195 million in 2010 to $223 million in 2011. Average total deposits grew by 17%, from $169 million in 2010 to $198 million in 2011. The deposits were comprised primarily of business-oriented transaction accounts, with non-interest bearing checking accounts making up 57% of the total deposits as of year-end 2011.

The Bank's investment securities portfolio grew from $89.5 million in 2010 to $161.4 million at year end 2011. Net loans grew 8%, rising from $78.8 million to $85.1 million.

Asset Quality and Capital

At year end 2011, the Bank had zero ($0) past due loans, zero ($0) non-accrual loans, and zero ($0) Other Real Estate Owned (OREO). Net charge-offs for the year were 0.08% of average total loans. As of December 31, 2011, the Bank's loan loss reserve stood at $1.5 million or 1.78% of total loans.

In December 2011, Chain Bridge Bancorp, Inc. raised $2.1 million in additional capital via a "rights" offering to its existing shareholders only. The rights offering was oversubscribed, with $2.8 million in rights and over-allotments being requested but only $2.1 million being offered. The holding company used the proceeds of the offering to purchase additional shares of stock in the Bank. The Bank's Tier 1 Risk Based Capital Ratio was 14.69% and its total Risk Based Capital Ratio was 15.66%, at year-end 2011.

Yields on Earning Assets

Due to falling interest rates, the Bank's yield on its earning assets fell 27 basis points, from 4.77% to 4.50%, during the course of the year. However, the Bank's Cost of Funds fell by 34 basis points, from .77% to .43%. As a result, the Bank's interest margin on a fully taxable equivalent basis improved from 4.03% in 2010 to 4.09% in 2011.

New Product and Service Offerings

The Bank introduced two new services in 2011, Lock-Box and Positive Pay, both of which proved especially popular with CFOs of trade associations, medical offices and large commercial clients.

The Lock-Box service allows clients to cut down on clerical expenses, reduce deposit delays, and enhance audit controls, by outsourcing their remittance processing. Chain Bridge collects the client's remittances from the post office, processes them promptly, and immediately deposits them into the client's account.

Positive Pay helps to prevent check and ACH fraud by matching a list of the client's previously authorized debits to the checks actually presented against the account. By using Positive Pay, the client can immediately suspend suspicious items, place stop pays and return fraudulent checks. Positive Pay is a valuable tool for commercial clients who issue a large volume of checks each month.

Outlook for the Year Ahead

Commenting on 2011 results, and looking forward to the year ahead, Chain Bridge Chairman Peter G. Fitzgerald said: "Despite a mixed economy and a continued fall in interest rates, Chain Bridge continued to succeed by offering superior value and service to its clients. Business volumes in all areas increased substantially."

"Due to government spending, the local Washington economy has held up better than most in recent years. Given the federal government's rising debt levels, however, it is increasingly likely that the rate of growth in government spending will decline. Chain Bridge's board and management will attempt to maintain a strong balance sheet and conservative orientation that will help the Bank to continue to prosper, in the event the local economy slows."

Added Chain Bridge President and Chief Executive Officer John Brough: "Chain Bridge Bank continues to perform at a high level thanks to a loyal client base, dedicated banking team and supportive shareholder base. Careful planning and focused execution of a conservative business plan have put the Bank in a strong financial position and provide the foundation for continued success."

Chain Bridge Bank, National Association is a full service community bank organized under the laws of the United States and is the sole subsidiary of Chain Bridge Bancorp, Inc., a bank holding company registered with the Federal Reserve Bank. The Bank opened for business on August 6, 2007. The Bank is headquartered in McLean, Virginia and serves the communities of Northern Virginia and Washington, D.C. The Bank is a member of the FDIC and its deposits are insured up to the legal maximums. The Company's shares are privately held.

Chain Bridge Bancorp, Inc (Consolidated)
Chain Bridge Bank, National Association
McLean, VA
Financial Highlights Year End
Period Ended December 31,
2011 2010
(Dollars in Thousands) (Unaudited) (Audited)
Performance Measures and Yields
Consolidated net income $ 2,403 $ 2,098
Earnings growth rate (%) 14.56 % 48.05 %
Return on average assets (ROAA) (%) 1.08 % 1.08 %
Return on average equity (ROAE) (%) 10.66 % 10.68 %
Yield on earning assets (%) 4.50 % 4.77 %
Cost of interest bearing liabilities (%) 0.77 % 1.08 %
Cost of funds (%) 0.43 % 0.77 %
Net interest margin (%) 4.09 % 4.03 %
Balance Sheet Highlights
Total assets $ 292,099 $ 188,986
Total loans & leases $ 86,591 $ 80,323
Total deposits $ 263,019 $ 155,579
Loans to deposit ratio (%) 33 % 52 %
Capitalization
Total equity capital $ 26,809 $ 20,052
Percent change in total equity capital 33.7 % 13.3 %
Tangible equity $ 26,809 $ 20,052
Tier 1 capital $ 23,721 $ 19,159
Equity as a percentage of total assets (%) 9.18 % 10.61 %
Total risk-based capital ratio (%) 15.86 % 17.25 %
Tier 1 risk-based ratio (%) 14.89 % 16.04 %
Deposit Composition (%)
Noninterest bearing deposits / deposits 56.8 % 24.4 %
Transaction accounts / deposits 77.3 % 43.8 %
MMDAs & savings / deposits 11.3 % 27.6 %
Time deposits / deposits 11.4 % 28.6 %
Asset Quality (%)
Non-performing assets / assets 0.08 % 0.13 %
Loan loss reserves / gross loans 1.78 % 1.80 %
Reserves / non-performing assets 642 % 578 %
Net charge-offs / average loans 0.08 % 0.07 %
Chain Bridge Bancorp, Inc. Share Information
Number of shares outstanding 20,086 18,581
Book value per share (dollars) $ 1,334.69 $ 1,079.17
Percent change in book value per share 23.68 % 12.61 %
Net income per share (dollars) $ 128.82 $ 113.40
Percent change in net income per share 13.60 % 46.55 %

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