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Old Line Bancshares, Inc. Reports Net Income for the Three Months and Year Ended December 31, 2014

BOWIE, Md., Jan. 22, 2015 (GLOBE NEWSWIRE) -- Old Line Bancshares, Inc. (Nasdaq:OLBK), the parent company of Old Line Bank, reports net income of $1.8 million available to common stockholders for the three months ended December 31, 2014, compared to $4.4 million for the three months ended December 31, 2013. Earnings were $0.17 per basic and $0.16 per diluted common share for the three months ended December 31, 2014, compared to $0.41 per basic and diluted common share for the same period in 2013. For the prior year quarter ending December 31, 2013, earnings were positively impacted by the sale of $22.6 million in loans which resulted in a $3.4 million pre-tax gain. Net loans increased $41.5 million, or a 4.66% net increase, in organic loan growth for the three months ending December 31, 2014 and $81.9 million, or a 9.64% increase, for the twelve months ending December 31, 2014.

Earnings were $7.1 million for the year ended December 31, 2014, compared to $7.8 million for the year ended December 31, 2013. Earnings were $0.66 per basic and $0.65 per diluted common share, respectively, for the year ended December 31, 2014 and $0.87 and $0.86, respectively, per basic and diluted share in 2013.

Total assets at December 31, 2014 increased by $60.3 million compared to December 31, 2013. Total net loans held-for-investment increased $42.7 million and $79.3 million, respectively, during the three and twelve month periods ended December 31, 2014. Non-performing assets decreased 48.82%, or $6.8 million, to 0.65% of total assets at December 31, 2014 compared to 1.27% at December 31, 2013.

James W. Cornelsen, President and Chief Executive Officer of Old Line Bancshares, Inc. stated: "We are very pleased to report that we continue to generate strong organic loan and deposit growth. Total loans increased a vigorous $41.5 million in the quarter and $81.9 million for the year. Our non-interest deposits have increased $13.6 million for the quarter and $32.2 million for the year. We are also proud to report that we ended the year with a 62 basis point decline in our non-performing assets as a percentage of total assets compared to the prior year. Our focus for the coming year is to continue to grow our loan and non-maturity deposit portfolios, improve asset quality and improve operating efficiency."

4th QUARTER HIGHLIGHTS:

  • Net loans held-for-investment during the three month period grew $42.7 million.
  • Net income of $1.8 million, or $0.17 per basic and $0.16 per diluted share, was recorded for the three month period ending December 31, 2014, compared to net income of $4.4 million, or $0.41 per basic and diluted share, for the fourth quarter of 2013.
  • Non-performing assets decreased 7.14% to 0.65% of total assets at December 31, 2014 compared to 0.70% at September 30, 2014.
  • The net interest margin was 4.08% compared to 4.64% for the same period in 2013. Interest expense on total interest-bearing liabilities decreased to 0.45% for the three months ended December 31, 2014 compared to 0.51% for the same three month period of 2013.
  • The previously announced closing of four branches resulted in one-time charges to occupancy, disposal of equipment and severance of $462 thousand, $260 thousand, $141 thousand pre-tax, for the three month period ending December 31, 2014, respectively. The estimated pre-tax cost savings for 2015 is $1.5 million.
  • Return on Average Assets (ROAA) and Return on Average Equity (ROAE) for the three months ended December 31, 2014 were 0.58% and 5.21%, respectively, compared to ROAA and ROAE of 1.50% and 13.62%, respectively, for the three months ending December 31, 2013. The ROAA and ROAE for 2013 include $3.4 million, $2.1 million net of tax, on the gain on the sale of acquired impaired loans

2014 FULL YEAR HIGHLIGHTS

  • Net loans held-for-investment increased $79.3 million during the twelve months ended December 31, 2014, to $926.6 million at December 31, 2014, compared to $847.2 million at December 31, 2013, as a result of organic growth within our surrounding area.
  • Non-performing assets decreased 48.82% to 0.65% of total assets at December 31, 2014 compared to 1.27% at December 31, 2013.
  • Total deposits grew $41.4 million during the twelve months ending December 31, 2014. Non-interest bearing deposits increased $32.2 million, or 14.07%, during the twelve months ending December 31, 2014. Interest-bearing deposits grew $9.2 million, or 1.24%, during the twelve months ending December 31, 2014. Our interest-bearing non-maturity deposits increased $26.2 million, offsetting a $17.0 million decline in time deposits.
  • The provision for loan losses for the year ending December 31, 2014 was $2.8 million compared to $1.5 million for the year ending December 31, 2013, as further discussed below.
  • The net interest margin was 4.15% during 2014 compared to 4.52% for 2013. The net interest margin in 2013 benefited from a higher level of accretion on acquired loans due to early payoffs on acquired loans with credit marks. Re-pricing in the loan portfolio and lower yields on new loans also caused the average loan yield to decline.
  • Total assets at December 31, 2014 increased by $60.3 million, or 5.17%, from December 31, 2013.
  • For the twelve months ended December 31, 2014, ROAA and ROAE were 0.60% and 5.45%, respectively, compared to ROAA and ROAE of 0.74% and 7.80%, respectively, for the twelve months ended December 31, 2013.
  • We ended 2014 with a book value of $12.51 per common share and a tangible book value of $11.38 per common share compared to $11.71 and $10.50, respectively, at December 31, 2013.
  • We maintained strong liquidity and by all regulatory measures remained "well capitalized".

Total assets at December 31, 2014 increased $60.3 million from December 31, 2013 primarily due to an increase of $79.3 million in loans held-for-investment offsetting a decrease of $10.5 million in our investment securities available for sale and $5.8 million decrease in our deferred tax assets.

Total net loans held-for-investment increased $79.3 million during 2014 as a result of continued efforts to originate new loans, primarily in our commercial real estate and construction permanent loan portfolios.

Nonperforming assets, which include non-accrual loans, foreclosed real estate and troubled debt restructured loans, decreased 62 basis points from 1.27% of total assets at December 31, 2013 to 0.65% of total assets at December 31, 2014. Non-accrual loans were $5.2 million at December 31, 2014 compared to $8.8 million at December 31, 2013, reflecting a reduction of $3.6 million, primarily due to one commercial/hotel loan that was resolved during the third quarter of 2014. Other real estate owned declined $1.9 million from December 31, 2013 primarily due to the sale of nine foreclosed properties, resulting in a net gain of $698 thousand.

Deposit growth during the twelve month period was $41.4 million, primarily in non-interest deposits. Non-interest deposits increased $32.2 million. This increase is due to our enhanced presence in our primary market and surrounding areas as a result of our marketing efforts as well as the continued efforts of our cash management and financial services teams.

The increase in our provision for loan losses during the twelve month period ended December 31, 2014 was primarily due to the same commercial/hotel loan that was placed on nonaccrual status during the first quarter of 2014 in connection with which we recognized an additional provision of $1.4 million in the second quarter. This commercial loan was subsequently resolved in the third quarter as expected with no additional loss. Due to the sale of this property, an anticipated $2.7 million charge off was incurred during the third quarter of 2014.

Net income for the three month period ending December 31, 2014 decreased $2.6 million as compared for the same three month period of 2013. This decrease is primarily the result of a $3.8 million decrease in non-interest income, primarily from the reduction in the gain on sale of loans. Gain on the sale of loans decreased $3.3 million for the three month period ending December 31, 2014 due to the fourth quarter 2013 sale of impaired loans we acquired in our previous mergers with Maryland Bankcorp, Inc. and WSB Holdings, Inc. ("WSB"), which resulted in a $3.4 million gain on the sale of loans. Gain on the sale of loans also includes gains on the sale of residential mortgage loans sold in the secondary market. Gain on the sale of these loans was $277 thousand for the three month period ending December 31, 2014, compared to $200 thousand for the same three month period of 2013. Occupancy and equipment expenses included $462 thousand, severance expense included $141 thousand and a loss on disposal of assets included $48 thousand which was incurred as a result of the previously announced closings of four branches.

Net income for 2014 compared to 2013 decreased $709 thousand. This decrease is primarily the result of a $2.9 million, or 32.84%, decrease in non-interest income, partially offset by an increase of $1.7 million, or 4.10%, in net interest income and a decrease of $1.0 million, or 2.86%, in non-interest expenses. The decrease in non-interest income of $2.9 million was primarily from the reduction in the gain on the sale of loans as discussed above. The decrease in non-interest expenses for the twelve month period was primarily due to merger expenses that were recognized during the year ending December 31, 2013 as a result of the WSB acquisition, partially offset by increases in salaries and benefits and occupancy and equipment expenses for 2014. Salaries and benefits increased as a result of a full year of salaries and benefits for employees added in the WSB merger, as well as severance payments totaling $793 thousand due to the merger and branch closings. Occupancy and equipment expenses included $462 thousand and a loss on disposal of assets of $48 thousand was incurred as a result of expenses associated with the previously announced closings of four branches.

Interest income decreased for the three month period ending December 31, 2014 compared to the same period of 2013 as a result of a decrease in the yield earned on our average interest earning assets, partially offset by an increase in the amount of our average interest earning assets. During the quarter ended December 31, 2014, yield on our average interest earning assets was 4.42% compared to 5.05% for same three month period of 2013. The net effect of fair value accretion/amortization on acquired loans affects the net interest income. The fair value accretion/amortization is recorded on pay downs during the period recognized. Payoffs during the three months ending December 31, 2014 contributed a 5 basis points increase, as compared to 57 basis points for the three months ending December 31, 2013.

Net interest income increased during the twelve month period ending December 31, 2014 as a result of an increase in our average interest earnings assets, partially offset by a decrease in the yield on such assets.

Net interest margin for the three months ended December 31, 2014 decreased to 4.08% from 4.64% during the three months ending December 31, 2013. The net interest margin for the twelve months ended December 31, 2014 decreased to 4.15% from 4.53% during the twelve months ending December 31, 2013. We have experienced an unfavorable variance relating to the interest rate component because rates on earning assets have declined at a greater pace compared to deposit cost. Accordingly, the prolonged low interest rate environment has resulted in a compression of the net interest margin. Our growth in loans continues to result in favorable volume component change and overall change. Payoffs during the three months ending December 31, 2014 contributed to an increase of 11 basis points, as compared to the three months ending September 30, 2014. For the twelve months ended December 31, 2014, large payoffs during the third quarter attributed to the acceleration of amortization of fair value marks on acquired loans, which negatively impacted the yield on loans by a decrease of 29 basis points compared to same twelve month period of 2013. The average interest rate on total interest-bearing liabilities decreased to 0.45% for the three months ended December 31, 2014 compared to 0.51% for the three months ended December 31, 2013. The average interest rate on total interest-bearing liabilities decreased to 0.48% for the twelve months ended December 31, 2014 compared to 0.57% for the twelve months ended December 31, 2013.

Old Line Bancshares, Inc. is the parent company of Old Line Bank, a Maryland chartered commercial bank headquartered in Bowie, Maryland, approximately 10 miles east of Andrews Air Force Base and 20 miles east of Washington, D.C. Old Line Bank has 19 branches located in its primary market area of suburban Maryland (Washington, D.C. suburbs and Southern Maryland) counties of Anne Arundel, Calvert, Charles, Prince George's and St. Mary's. It also targets customers throughout the greater Washington, D.C. metropolitan area.

The statements in this press release that are not historical facts, in particular the statements with respect to continued loan and deposit growth and improved asset quality and operating efficiency, constitute a "forward-looking statement" as defined by Federal securities laws. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. These statements can generally be identified by the use of forward-looking terminology such as "believes," "expects," "intends," "may," "will," "should," "anticipates", "plans" or similar terminology. Actual results could differ materially from those currently anticipated due to a number of factors, including, but not limited to, deterioration in economic conditions or a slowdown in the recovery in our target markets or nationally, sustained high levels of or increases in the unemployment rate in our target markets, the actions of our competitors and our ability to successfully compete, in particular in new market areas, and changes in laws impacting our ability to collect on outstanding loans or otherwise negatively impact our business, including regulations implemented pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act enacted in July 2010. Forward-looking statements speak only as of the date they are made. Old Line Bancshares, Inc. will not update forward-looking statements to reflect factual assumptions, circumstances or events that have changed after a forward-looking statement was made. For further information regarding risks and uncertainties that could affect forward-looking statements Old Line Bancshares, Inc. may make, please refer to the filings made by Old Line Bancshares, Inc. with the U.S. Securities and Exchange Commission available at www.sec.gov.

Old Line Bancshares, Inc. & Subsidiaries
Consolidated Balance Sheets
December 31,
2014
September 30,
2014
June 30,
2014
March 31,
2014
December 31,
2013 (1)
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Cash and due from banks $ 23,572,613 $ 42,266,194 $ 29,887,334 $ 54,197,169 $ 28,316,351
Interest bearing accounts 1,230,864 30,396 30,389 30,383 30,375
Federal funds sold 601,259 533,612 304,246 178,806 711,574
Total cash and cash equivalents 25,404,736 42,830,202 30,221,969 54,406,358 29,058,300
Investment securities available for sale 161,680,198 163,535,833 155,706,684 172,094,347 172,169,776
Loans held for sale 4,548,106 5,735,282 4,074,911 1,646,330 2,014,711
Loans held for investment, less allowance for loan losses of $4,281,835 and $4,929,213 for December 31, 2014 and December 31, 2013. 926,573,488 883,905,233 889,524,786 849,429,721 847,248,590
Equity securities at cost 5,811,697 4,304,197 4,304,196 4,304,197 5,669,807
Premises and equipment 34,300,375 34,366,258 34,604,271 34,661,659 35,215,868
Accrued interest receivable 3,218,428 3,002,457 2,978,470 3,131,042 3,432,924
Deferred income taxes 16,106,498 19,843,857 19,850,224 20,639,961 21,868,076
Bank owned life insurance 31,429,747 31,214,396 31,000,380 30,787,554 30,577,187
Other real estate owned 2,451,920 2,699,846 4,627,465 4,593,154 4,311,342
Goodwill 7,793,665 7,793,665 7,793,665 7,793,665 7,793,665
Core deposit intangible 4,420,796 4,633,766 4,846,737 5,058,951 5,287,501
Other assets 3,779,350 4,128,206 3,732,934 4,390,527 2,575,377
Total assets $ 1,227,519,004 $ 1,207,993,198 $ 1,193,266,692 $ 1,192,937,466 $ 1,167,223,124
Deposits
Non-interest bearing $ 260,913,521 $ 247,291,192 $ 237,614,952 $ 234,512,077 $ 228,733,624
Interest bearing 754,825,885 772,344,384 771,801,936 773,640,266 745,625,862
Total deposits 1,015,739,406 1,019,635,576 1,009,416,888 1,008,152,343 974,359,486
Short term borrowings 61,002,889 35,558,734 35,769,108 38,193,867 49,530,125
Long term borrowings 5,987,283 6,017,844 6,043,715 6,071,856 6,093,074
Accrued interest payable 266,023 241,740 229,939 241,981 264,807
Accrued pension 5,095,141 5,069,745 5,003,784 4,996,120 4,921,241
Income taxes payable 485,435 3,406,234 2,376,461 2,988,981 2,556,609
Other liabilities 3,416,190 4,557,087 2,252,083 2,744,510 2,948,464
Total liabilities 1,091,992,367 1,074,486,960 1,061,091,978 1,063,389,658 1,040,673,806
Stockholders' equity
Common stock 108,110 107,864 107,854 107,854 107,772
Additional paid-in capital 105,235,646 104,900,904 104,820,171 104,748,891 104,622,171
Retained earnings 30,067,798 28,826,765 27,621,537 26,283,617 24,879,275
Accumulated other comprehensive (loss) (147,250) (589,650) (639,502) (1,871,087) (3,359,823)
Total Old Line Bancshares, Inc. stockholders' equity 135,264,304 133,245,883 131,910,060 129,269,275 126,249,395
Non-controlling interest 262,333 260,355 264,654 278,533 299,923
Total stockholders' equity 135,526,637 133,506,238 132,174,714 129,547,808 126,549,318
Total liabilities and stockholders' equity $ 1,227,519,004 $ 1,207,993,198 $ 1,193,266,692 $ 1,192,937,466 $ 1,167,223,124
Shares of basic common stock outstanding 10,810,930 10,786,370 10,785,370 10,785,370 10,777,112
(1) Financial information as of December 31, 2013 has been derived from audited financial statements.
Old Line Bancshares, Inc. & Subsidiaries
Consolidated Statements of Income
Three Months
Ended
December 31,
Three Months
Ended
September 30,
Three Months
Ended
June 30,
Three Months
Ended
March 31,
Three Months
Ended
December 31,
Twelve Months
Ended
December 31,
Twelve Months
Ended
December 31,
2014 2014 2014 2014 2013 (1) 2014 2013
(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
Interest income
Loans, including fees $ 10,556,729 $ 10,232,684 $ 10,599,999 $ 10,333,973 $ 11,519,191 $ 41,723,378 $ 40,206,378
Investment securities and other 939,602 885,324 1,017,039 1,037,897 1,060,493 3,879,868 4,056,460
Total interest income 11,496,331 11,118,008 11,617,038 11,371,870 12,579,684 45,603,246 44,262,838
Interest expense
Deposits 799,716 850,964 856,639 894,303 923,039 3,401,622 3,716,044
Borrowed funds 119,214 111,693 148,918 118,276 122,522 498,101 486,209
Total interest expense 918,930 962,657 1,005,557 1,012,579 1,045,561 3,899,723 4,202,253
Net interest income 10,577,401 10,155,351 10,611,481 10,359,291 11,534,123 41,703,523 40,060,585
Provision for loan losses 458,114 555,134 1,544,280 269,769 514,190 2,827,297 1,504,190
Net interest income after provision for loan losses 10,119,287 9,600,217 9,067,201 10,089,522 11,019,933 38,876,226 38,556,395
Non-interest income
Service charges on deposit accounts 475,120 483,865 493,482 451,596 472,945 1,904,063 1,607,931
Gain on sales or calls of investment securities -- -- 129,911 -- -- 129,911 641,088
Gain on sale of stock -- -- -- 96,993 -- 96,993 --
Earnings on bank owned life insurance 249,967 248,259 246,371 243,607 252,265 988,204 840,028
Gains (losses) on disposal of assets (48,051) -- 17,919 -- -- (30,131) (104,639)
Gain on sale of loans 276,531 224,930 195,829 106,720 3,601,972 771,815 3,890,029
Other fees and commissions 438,561 348,090 784,622 493,209 852,470 2,096,069 1,995,745
Total non-interest income 1,392,128 1,305,144 1,868,134 1,392,125 5,179,652 5,956,924 8,870,182
Non-interest expense
Salaries & employee benefits 4,303,832 4,602,520 4,051,407 4,873,634 4,668,944 17,831,394 16,617,920
Occupancy & Equipment 1,878,052 1,367,808 1,436,564 1,586,777 1,513,265 6,268,593 5,353,300
Data processing 352,956 368,717 312,042 307,160 393,863 1,340,875 1,422,771
Merger and integration -- -- -- 29,167 349,028 29,167 3,518,945
Core deposit amortization 212,970 212,970 212,214 228,550 231,119 866,704 838,694
(Gains)losses on sales of other real estate owned (155,148) (260,533) (79,127) (203,068) (210,665) (697,875) (144,934)
OREO expense 199,094 159,238 112,659 83,066 210,122 554,057 838,429
Other operating 2,257,866 2,078,155 2,446,147 2,071,256 2,284,281 8,853,420 7,632,164
Total non-interest expense 9,049,622 8,528,875 8,491,906 8,976,542 9,439,957 35,046,335 36,077,289
Income before income taxes 2,461,793 2,376,486 2,443,429 2,505,105 6,759,628 9,786,815 11,349,288
Income tax expense 679,154 636,239 687,973 690,737 2,393,268 2,694,104 3,602,083
Net income 1,782,639 1,740,247 1,755,456 1,814,368 4,366,360 7,092,711 7,747,205
Less: Net income (loss) attributable to the noncontrolling interest 1,978 (4,299) (13,880) (21,389) (61,892) (37,589) (91,624)
Net income available to common stockholders $ 1,780,661 $ 1,744,546 $ 1,769,336 $ 1,835,757 $ 4,428,252 $ 7,130,300 $ 7,838,829
Earnings per basic share $ 0.17 $ 0.16 $ 0.16 $ 0.17 $ 0.41 $ 0.66 $ 0.87
Earnings per diluted share $ 0.16 $ 0.16 $ 0.16 $ 0.17 $ 0.41 $ 0.65 $ 0.86
Dividend per common share $ 0.05 $ 0.05 $ 0.04 $ 0.04 $ 0.04 $ 0.18 $ 0.16
Average number of basic shares 10,792,544 10,785,881 10,785,370 10,780,141 10,768,104 10,786,017 9,044,944
Average number of dilutive shares 10,941,002 10,921,555 10,948,368 10,942,110 10,891,654 10,935,182 9,149,200
(1) Financial information as of December 31, 2013 has been derived from audited financial statements.
Old Line Bancshares, Inc. & Subsidiaries
Average Balances, Interest and Yields
12/31/2014 9/30/2014 6/30/2014 3/31/2014 12/31/2013
Average
Balance

Yield
Average
Balance

Yield
Average
Balance

Yield
Average
Balance

Yield
Average
Balance

Yield
Assets:
Int. Bearing Deposits $ 2,902,672 0.20% $ 3,896,273 0.17% $ 4,024,265 0.17% $ 1,352,504 0.12% $ 2,903,193 0.11%
Investment Securities (2) 168,069,134 2.40% 159,259,044 2.94% 170,389,632 3.00% 174,564,325 3.06% 188,455,728 2.82%
Loans 905,241,954 4.78% 897,381,372 4.57% 865,944,038 4.99% 851,079,999 5.00% 837,359,182 5.54%
Allowance for Loan Losses (2,570,097) (6,422,492) (5,290,130) (5,001,250) (4,609,398)
Total Loans
Net of allowance 902,671,857 4.79% 890,958,880 4.60% 860,653,908 5.02% 846,078,749 5.03% 832,749,784 5.57%
Total interest-earning assets 1,073,643,663 4.42% 1,054,114,197 4.33% 1,035,067,805 4.67% 1,021,995,578 4.69% 1,024,108,705 5.05%
Noninterest bearing cash 38,925,730 42,071,667 39,297,001 36,258,104 38,364,347
Other Assets 107,033,944 109,199,887 109,464,228 110,237,569 111,316,325
Total Assets $ 1,219,603,337 $ 1,205,385,751 $ 1,183,829,034 $ 1,168,491,251 $ 1,173,789,377
Liabilities and Stockholders' Equity
Interest-bearing Deposits $ 767,241,928 0.41% $ 776,032,831 0.44% $ 768,879,677 0.45% $ 751,439,481 0.48% $ 754,128,604 0.49%
Borrowed Funds 50,442,530 0.94% 39,031,131 1.14% 41,102,469 1.45% 51,661,794 0.93% 53,222,290 0.91%
Total interest-bearing liabilities 817,684,458 0.45% 815,063,962 0.47% 809,982,146 0.50% 803,101,275 0.51% 807,350,894 0.51%
Noninterest bearing deposits 255,002,560 247,346,466 234,063,213 229,229,562 228,810,018
1,072,687,018 1,062,410,428 1,044,045,359 1,032,330,837 1,036,160,912
Other Liabilities 11,057,397 10,072,582 9,603,037 10,813,815 8,360,917
Noncontrolling Interest 261,545 262,435 270,521 285,355 300,800
Stockholder's Equity 135,597,377 132,640,306 129,910,117 125,061,244 128,966,748
Total Liabilities and Stockholder's Equity $ 1,219,603,337 $ 1,205,385,751 $ 1,183,829,034 $ 1,168,491,251 $ 1,173,789,377
Net interest spread 3.97% 3.86% 4.17% 4.18% 4.54%
Net interest income and Net interest margin(1) $ 11,034,119 4.08% $ 10,545,444 3.97% $ 11,047,069 4.28% $ 10,809,169 4.29% $ 11,986,354 4.64%
(1) Interest revenue is presented on a fully taxable equivalent (FTE) basis. The FTE basis adjusts for the tax favored status of these types of assets. Management believes providing this information on a FTE basis provides investors with a more accurate picture of our net interest spread and net interest income and we believe it to be the preferred industry measurement of these calculations. See "Reconciliation of Non-GAAP Measures."
(2) Available for sale investment securities are presented at amortized cost.

The accretion of the fair value adjustments resulted in a positive impact in the yield on loans for the three months ending December 31, 2014, compared to a negative impact on the yield on loans in the linked three month period ending September 30, 2014. Fair value accretion for the current quarter and prior four quarter are as follows:

12/31/2014 9/30/2014 6/30/2014 3/31/2014 12/31/2013
Fair Value
Accretion
Dollars
% Impact on
Net Interest
Margin
Fair Value
Accretion
Dollars
% Impact on
Net Interest
Margin
Fair Value
Accretion
Dollars
% Impact on
Net Interest
Margin
Fair Value
Accretion
Dollars
% Impact on
Net Interest
Margin
Fair Value
Accretion
Dollars
% Impact on
Net Interest
Margin
Commercial loans (1) $ (969) (0.00)% $ (16,219) (0.01)% $ (3,509) (0.00)% $ 7,468 0.00% $ 102 0.00%
Mortgage loans (1) 24,779 0.01 (278,619) (0.10) 344,403 0.13 287,526 0.11 1,322,480 0.51
Consumer loans 6,686 0.00 4,209 0.00 6,338 0.00 4,635 0.00 7,821 0.00
Interest bearing deposits 110,503 0.04 131,837 0.05 162,452 0.06 129,327 0.05 164,527 0.06
Total Fair Value Accretion (Amortization) $ 140,999 0.05% $ (158,792) (0.06)% $ 509,684 0.19% $ 428,956 0.16% $ 1,494,930 0.57%
(1) Negative accretion on commercial and mortgage loans is due to the early payoff of loans which caused a reduction in fair value income on acquired loan portfolio.

Below is a reconciliation of the fully tax equivalent adjustments and the GAAP basis information presented in this report:

12/31/2014 9/30/2014 6/30/2014 3/31/2014 12/31/2013
Net Interest
Income

Yield
Net Interest
Income

Yield
Net Interest
Income

Yield
Net Interest
Income

Yield
Net Interest
Income

Yield
GAAP net interest income 10,577,401 3.91 10,155,351 3.82% $ 10,611,481 4.11% $ 10,359,291 4.11% $ 11,534,123 4.46%
Tax equivalent adjustment
Federal funds sold 1 0.00 -- -- -- -- -- -- -- --
Investment securities 343,280 0.13 294,770 0.11 258,980 0.10 281,377 0.11 282,137 0.11
Loans 113,437 0.04 95,323 0.04 176,608 0.07 168,501 0.07 170,094 0.07
Total tax equivalent adjustment 456,718 0.17 390,093 0.15 435,588 0.17 449,878 0.18 452,231 0.18
Tax equivalent interest yield $ 11,034,119 4.08 $ 10,545,444 3.97% $ 11,047,069 4.28% $ 10,809,169 4.29% $ 11,986,354 4.64%
Old Line Bancshares, Inc. & Subsidiaries
Selected Loan Information
(Dollars in thousands)
December 30,
2014
September 30,
2014
June 30,
2014
March 31,
2014
December 31,
2013
Acquired Loans(1)
Accruing $ 173,649 $ 183,102 $ 199,859 $ 206,517 $ 214,087
Non-accrual(2) 1,958 1,291 593 861 663
Accruing 30-89 days past due 3,687 1,569 1,478 2,977 4,465
Accruing 90 or more days past due 310 942 1,271 477 1,655
Net charge offs (recoveries) 52 316 106 148 (43)
Legacy Loans(3)
Accruing $ 755,207 $ 698,589 $ 691,591 $ 633,426 $ 620,560
Non-accrual 3,249 3,263 7,176 7,202 8,156
Accruing 30-89 days past due 343 3,411 2,177 1,601 1,574
Accruing 90 or more days past due -- 305 674 218 --
Net charge offs (recoveries) (4) 2,691 (4) 169 56
Allowance for loan losses as % of held for investment loans 0.46% 0.44% 0.71% 0.57% 0.58%
Allowance for loan losses as % of legacy loans 0.57% 0.55% 0.80% 0.76% 0.78%
Total non-performing loans as a % of held for investment loans 0.56% 0.96% 1.08% 1.56% 1.73%
Total non-performing assets as a % of total assets 0.65% 0.70% 1.20% 1.12% 1.27%
(1) Acquired loans represent all loans acquired on April 1, 2011 from MB&T and on May 10, 2013 from WSB. We originally recorded these loans at fair value upon acquisition.
(2) These loans are loans that are considered non-accrual because they are not paying in conformance with the original contractual agreement. At acquisition, we recorded these loans at fair value. Until the December 31, 2013 quarter, we recognized interest income on these loans through the accretion of the difference between the carrying value of these loans and their expected cash flows. In the fourth quarter of 2013, we are no longer recording interest on these loans that were not purchased as credit impaired.
(3) Legacy loans represent total loans excluding loans acquired on April 1, 2011 and May 10, 2013.

CONTACT: OLD LINE BANCSHARES, INC. ELISE HUBBARD CHIEF FINANCIAL OFFICER (301) 430-2560Source:Old Line Bancshares, Inc.