Glen Burnie Bancorp(GLBZ) - 2025 Q2 - Quarterly Results

Executive Summary & Highlights Second Quarter 2025 Performance Overview Glen Burnie Bancorp reported a net loss of $212,000 for Q2 2025, or $(0.07) diluted EPS, despite net interest margin expansion, loan growth, and stable deposits, with strategic initiatives underway Key Performance Metrics | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :-------------------------------- | :------ | :------ | :------ | | Net (Loss) Income | $(212,000) | $153,000 | $(204,000) | | Diluted (Loss) Earnings Per Share | $(0.07) | $0.05 | $(0.07) | | Net Interest Margin (tax equivalent) (%) | 3.13% | 3.00% | - | | Total Loans Increase (QoQ) | $6.0 million | - | - | | Annualized Loan Growth Rate (%) | 11.5% | - | - | | Total Deposits (as of June 30, 2025) | $317.3 million | - | - | | Net Charge-offs (Q2 2025) | $45,000 | $4,000 | - | | Annualized Net Charge-offs Rate (%) | 0.09% | 0.01% | - | - The Bank entered into a stock purchase agreement with VA Wholesale Mortgage, Inc. (VAWM) on March 5, 2025, expected to close in August 2025, aiming to provide access to new products and markets, enable off-balance sheet mortgage origination and sales, and create cross-selling opportunities[4] - In June, the Bank launched a new credit card program as a strategic initiative to offer new products and services, positioning itself as a community bank with high service culture and large bank capabilities[4] Six-Month Performance Overview | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net (Loss) Income | $(59,000) | $(201,000) | | Diluted (Loss) Per Share | $(0.02) | $(0.07) | Management Commentary & Strategic Outlook CEO Mark C. Hanna emphasized strategic initiatives for revenue growth and operational efficiency, noting $280,000 in non-recurring expenses for headcount reduction from 89 to 73, alongside stable deposits, loan growth, and strong capital - Strategic priorities include increasing new revenue sources by growing client relationships and becoming more operationally efficient to expand return on assets and capital[6] - Non-recurring expenses of over $280,000 were incurred in Q2 2025 due to early retirement and employee severance as part of cost control initiatives[6] Headcount Reduction | Metric | Beginning of Year | June 30, 2025 | | :--------- | :---------------- | :------------ | | Headcount | 89 | 73 | - The Bank's deposit base and cost of funding remain competitive and stable, with good growth in loan revenues, strong liquidity, and ample capital[6] Financial Review Asset Quality The Bank maintained strong asset quality with disciplined lending, seeing non-performing loans decrease and total loans grow by $6.0 million, despite an increase in net charge-offs, while maintaining a robust allowance for loan losses Asset Quality Metrics | Metric | June 30, 2025 | March 31, 2025 | Q2 2024 | | :-------------------------------- | :------------ | :------------- | :------ | | Non-performing loans ratio (%) | 0.51% | 0.55% | - | | Net Charge-offs | $45,000 | $4,000 | - | | Net Charge-offs to Average Loans (%) | 0.09% | 0.01% | - | | Provision Expense | $79,000 | $(620,000) (release) | $600,000 | | Allowance for Loan Losses to Loans (%) | 1.21% | 1.30% | 1.30% | - Total loans increased by $6.0 million during Q2 2025, representing an annualized growth rate of 11.5%[8] Loan Growth Breakdown - Commercial real estate loans: +$3.4 million - C&I portfolio: +$0.9 million - Consumer loans (automobile): +$1.9 million - Construction and land loans: -$0.3 million Funding & Liquidity Total deposits remained stable at $317.3 million, with non-interest bearing deposits increasing by $2.5 million, while the cost of deposits and total cost of funds rose, as the Bank prioritizes loan growth over securities Deposit Composition and Growth | Metric | June 30, 2025 | March 31, 2025 | | :-------------------------- | :------------ | :------------- | | Total Deposits | $317.3 million | $317.257 million | | Non-interest Bearing Deposits | $107.027 million | $104.487 million | | Non-interest Bearing Deposits % of Total | 34% | - | | Non-interest Bearing Deposits Growth (QoQ) | +$2.5 million | - | | Annualized Non-interest Bearing Deposits Growth (%) | 9.7% | - | Cost of Funds and Borrowings | Metric | Q2 2025 | Q1 2025 | | :-------------------- | :------ | :------ | | Cost of Deposits (%) | 1.78% | 1.63% | | Total Cost of Funds (%) | 1.36% | 1.30% | | Borrowed Funds (FHLB) | $13.0 million | $20.0 million | Liquidity Sources - FHLB borrowing capacity: $31.4 million - Open pledging capacity of securities portfolio: $57.5 million - FRB borrowing capacity: $33.9 million - Additional access to other wholesale funding: $17.0 million Investment Securities Portfolio | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------- | :------------ | | Investment Securities Available for Sale | $104.6 million | $106.6 million | $117.2 million | | Yield on Securities (%) | 2.25% | - | - | | Effective Duration of Securities Portfolio (years) | 7.3 years | - | - | | Accumulated Other Comprehensive Loss (AOCL) | $(17.8) million | $(17.792) million | $(19.518) million | - The Bank's strategic direction is to grow its balance sheet through new loans rather than increasing reliance on the securities portfolio[11] Capital Adequacy The Bank's regulatory capital ratios, including a Leverage Ratio of 9.59% and Total Risk Based Ratio of 16.06%, continue to exceed well-capitalized minimums, demonstrating a strong capital position Regulatory Capital Ratios | Capital Ratio | June 30, 2025 (%) | March 31, 2025 (%) | June 30, 2024 (%) | | :---------------------- | :------------ | :------------- | :------------ | | Leverage Ratio | 9.59% | 9.71% | 10.10% | | Tier I Risk Based Ratio | 14.91% | 15.42% | 15.59% | | Total Risk Based Ratio | 16.06% | 16.60% | 16.84% | Income Statement Analysis Net Interest Income & Margin Net interest income increased slightly quarter-over-quarter, driven by a 13 basis point expansion in net interest margin to 3.13%, as the Bank strategically shifts earning assets from cash and securities towards loans Net Interest Income and Margin Trends | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :-------------------------------- | :------ | :------ | :------ | | Net Interest Income | $2.7 million | $2.6 million | $2.8 million | | Net Interest Margin (tax equivalent) (%) | 3.13% | 3.00% | 3.10% | | Yield on Earning Assets (QoQ change) | +20 bps | - | - | | Yields on Total Loans (QoQ change) | +24 bps (to 5.58%) | - | - | | Total Cost of Funds (QoQ change) | +6 bps (to 1.36%) | - | - | | Total Earning Assets | $359.3 million | $356.2 million | $371.0 million | - Loans now represent 58% of total earning assets at the end of Q2 2025, up from 50% in Q2 2024, indicating an intentional shift in the balance sheet mix from cash and securities to loans[13] Non-Interest Income Non-interest income increased modestly quarter-over-quarter to $220,000, with future growth anticipated from the expected acquisition of VAWM Non-Interest Income Performance | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :----------------- | :------ | :------ | :------ | | Non-interest Income | $220,000 | $205,000 | $241,000 | - The Bank anticipates increases in non-interest income due to the expected acquisition of VAWM[14] Non-Interest Expense Total non-interest expense remained flat quarter-over-quarter at $3.3 million, but increased year-over-year due to $287,000 in non-recurring costs for early retirement and headcount reductions, offset by decreases in other expenses Non-Interest Expense Breakdown | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--------------------- | :------ | :------ | :------ | | Total Noninterest Expense | $3.3 million | $3.3 million | $2.8 million | | Non-recurring costs | $287,000 | - | - | | Salary and employee benefits | +$199,000 (due to non-recurring costs) | - | - | | Occupancy and equipment expenses | Down | - | - | | Legal, accounting and professional fees | Down | - | - | | Data process services | Down | - | - | Corporate Information Company Profile Glen Burnie Bancorp, established in 1949, is a Maryland-based bank holding company with its subsidiary, The Bank of Glen Burnie, operating six branches offering commercial and retail banking services - Glen Burnie Bancorp is a bank holding company founded in 1949, with The Bank of Glen Burnie operating six branch offices in Anne Arundel County, Maryland[16] - The Bank offers commercial and retail banking services, including demand and time deposits, and a range of loans such as residential first and second mortgages, home equity lines of credit, commercial mortgage loans, and automobile loans[16] Forward-Looking Statements This disclaimer notes that statements not based on historical data are forward-looking and subject to risks and uncertainties, advising investors to consult SEC filings for detailed risk factors - Statements in the release that are not historical financial information are forward-looking and subject to risks and uncertainties that could cause actual results to differ materially from anticipated projections[17] - Investors should refer to the Company's reports filed with the SEC for a more complete discussion of risk factors[17] Contact Information Contact details for inquiries regarding Glen Burnie Bancorp's financial results are provided, including the President and CEO's name, title, phone, and email - For further information, contact Mark C. Hanna, President and Chief Executive Officer, at 410-768-8877 or mchanna@bogb.net[18] Consolidated Financial Statements Consolidated Balance Sheets The consolidated balance sheets present the Bancorp's financial position, with total assets of $350.7 million, total deposits of $317.3 million, and total stockholders' equity of $18.9 million as of June 30, 2025 Consolidated Balance Sheet Highlights | Metric | June 30, 2025 (in thousands) | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | June 30, 2024 (in thousands) | | :--------------------------------- | :------------ | :------------- | :---------------- | :------------ | | ASSETS | | | | | | Total Cash and Cash Equivalents | $12,668 | $23,676 | $24,464 | $16,786 | | Investment securities available for sale | $104,566 | $106,623 | $107,949 | $117,180 | | Loans, net | $210,775 | $204,704 | $202,380 | $198,875 | | Total Assets | $350,721 | $357,973 | $358,956 | $355,716 | | LIABILITIES | | | | | | Total Deposits | $317,316 | $317,257 | $309,189 | $305,866 | | Short-term borrowings | $13,000 | $20,000 | $30,000 | $30,000 | | Total Liabilities | $331,788 | $338,792 | $341,139 | $338,245 | | STOCKHOLDERS' EQUITY | | | | | | Total Stockholders' Equity | $18,933 | $19,181 | $17,817 | $17,471 | Consolidated Statements of (Loss) Income The consolidated statements of (loss) income detail financial performance, reporting a Q2 2025 net loss of $212,000, with net interest income of $2.736 million Consolidated Statements of (Loss) Income Highlights | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :--------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total Interest Income | $3,877 | $3,893 | $7,506 | $7,298 | | Total Interest Expense | $1,141 | $1,107 | $2,207 | $1,941 | | Net Interest Income | $2,736 | $2,786 | $5,299 | $5,357 | | (Release) provision of credit loss allowance | $79 | $600 | $(541) | $792 | | Total Noninterest Income | $220 | $241 | $425 | $471 | | Total Noninterest Expenses | $3,252 | $2,820 | $6,516 | $5,658 | | Net (loss) income | $(212) | $(204) | $(59) | $(201) | | Basic and diluted net (loss) income per common share | $(0.07) | $(0.07) | $(0.02) | $(0.07) | Consolidated Statement of Changes in Stockholders' Equity This statement outlines changes in stockholders' equity, showing total stockholders' equity of $18.933 million as of June 30, 2025, reflecting a net loss of $59,000 and other comprehensive income of $1.175 million Consolidated Statement of Changes in Stockholders' Equity Highlights | Metric | Common Stock (in thousands) | Additional Paid-in Capital (in thousands) | Retained Earnings (in thousands) | Accumulated Other Comprehensive (Loss) Income (in thousands) | Total Stockholders' Equity (in thousands) | | :--------------------------------- | :----------- | :------------------------- | :---------------- | :-------------------------------------------- | :------------------------- | | Balance, December 31, 2024 | $2,901 | $11,037 | $22,882 | $(19,003) | $17,817 | | Net income (loss) | - | - | $(59) | - | $(59) | | Other comprehensive income | - | - | - | $1,175 | $1,175 | | Balance, June 30, 2025 | $2,901 | $11,037 | $22,823 | $(17,828) | $18,933 | Selected Financial Data Key Financial and Performance Metrics This section summarizes key financial data, performance, asset quality, and capital ratios, highlighting the net loss for Q2 2025, net interest margin expansion, and the Bank's strong capital and asset quality metrics Selected Financial and Performance Metrics | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | December 31, 2024 | | :--------------------------------------- | :------------ | :------------- | :------------ | :---------------- | | Financial Data | | | | | | Assets (in thousands) | $350,721 | $357,973 | $355,716 | $358,956 | | Loans (in thousands) | $213,362 | $207,393 | $201,500 | $205,219 | | Deposits (in thousands) | $317,316 | $317,257 | $305,866 | $309,189 | | Net income (loss) (in thousands) | $(212) | $153 | $(204) | $(112) | | Performance Ratios | | | | | | Annualized return on average assets (%) | -0.24% | 0.18% | -0.22% | -0.03% | | Annualized return on average equity (%) | -4.30% | 3.22% | -4.72% | -0.58% | | Net interest margin - FTE (%) | 3.13% | 3.00% | 3.10% | 3.06% | | Basic and diluted net income (loss) per share | $(0.07) | $0.05 | $(0.07) | $(0.04) | | Asset Quality Ratios | | | | | | Allowance for loan losses to loans (%) | 1.21% | 1.30% | 1.30% | 1.38% | | Nonperforming loans to avg. loans (%) | 0.51% | 0.55% | 0.17% | 0.19% | | Net charge-offs (recoveries) annualize to avg. loans (%) | 0.09% | 0.01% | -0.14% | 0.08% | | Capital Ratios | | | | | | Common Equity Tier 1 Capital (%) | 14.91% | 15.42% | 15.59% | 15.15% | | Leverage Ratio (%) | 9.59% | 9.71% | 10.10% | 9.97% |