Sandy Spring Bancorp Reports Net Income of $11.2 Million for the First Quarter

OLNEY, Md., April 16, 2015 (GLOBE NEWSWIRE) -- Sandy Spring Bancorp, Inc., (Nasdaq:SASR) the parent company of Sandy Spring Bank, today reported net income for the first quarter of 2015 of $11.2 million ($0.45 per diluted share) compared to net income of $10.9 million ($0.43 per diluted share) for the first quarter of 2014 and net income of $9.1 million ($0.36 per diluted share) for the fourth quarter of 2014.

"We are off to a solid start to the year, as higher net interest income from a growing loan portfolio, together with growth in income from wealth management and mortgage banking drove first quarter operating results," said Daniel J. Schrider, President and Chief Executive Officer.

"Our consistent performance has enabled us to deliver increased shareholder value through increases to our dividends and timely repurchases of shares during the last two quarters," said Schrider.

First Quarter Highlights:

  • Total loans increased 12% compared to the first quarter of 2014 and 1% compared to the fourth quarter of 2014. Growth over the prior year was 10% or better in each of the three major portfolio segments.
  • Combined noninterest-bearing and interest-bearing transaction account balances increased 13% to $1.5 billion at March 31, 2015 as compared to $1.4 billion at March 31, 2014.
  • The provision for loan and lease losses for the first quarter of 2015 was a charge of $0.6 million compared to a credit of $1.0 million for the first quarter of 2014 and a charge of $0.9 million for the fourth quarter of 2014.
  • The net interest margin was 3.44% for the first quarter of 2015, compared to 3.47% for the first quarter of 2014 and 3.44% for the fourth quarter of 2014.
  • Non-interest income increased 17% for the quarter compared to the prior year quarter primarily due to increases in income from wealth management and mortgage banking.
  • During the first quarter of 2015, the Company repurchased 351,369 shares at an average price of $25.72 per share as part of its existing share repurchase program. Also, on January 29 the Board increased the Company's quarterly dividend to $0.22 per share, up from $0.20 per share in the fourth quarter of 2014.

Review of Balance Sheet and Credit Quality

Total assets grew 6% to $4.4 billion at March 31, 2015 compared to $4.2 billion at March 31, 2014. This growth was driven by a 12% increase in the loan portfolio as total loans and leases ended the period at $3.2 billion.

At March 31, 2015, combined noninterest-bearing and interest-bearing checking account balances, an important performance driver of multiple-product banking relationships with clients, increased 13% compared to balances at March 31, 2014. Total deposits and certain other short-term borrowings that comprise the funding sources derived from customers, increased 6% compared to March 31, 2014.

Tangible common equity totaled $435 million at March 31, 2015 compared to $424 million at March 31, 2014. The ratio of tangible common equity to tangible assets decreased to 10.08% at March 31, 2015 from 10.38% at March 31, 2014 due primarily to the growth in assets. Dividends per common share were $0.22 per share for the quarter compared to $0.18 per common share for the first quarter of 2014, a 22% increase. At March 31, 2015, the Company had a total risk-based capital ratio of 15.12%, a common equity tier 1 risk-based capital ratio of 14.01%, a tier 1 risk-based capital ratio of 14.01% and a tier 1 leverage ratio of 11.00%.

Non-performing loans totaled $36.0 million at March 31, 2015 compared to $38.7 million at March 31, 2014 and $34.0 million at December 31, 2014. The level of non-performing loans to total loans decreased to 1.14% at March 31, 2015 compared to 1.37% at March 31, 2014 due to growth in the overall loan portfolio. The increase in non-performing loans at March 31, 2015 compared to December 31, 2014 was driven primarily by one commercial investor real estate loan that was moved to non-performing status during the quarter. This was somewhat offset by recoveries and loan payoffs.

Loan charge-offs, net of recoveries, totaled $0.9 million for the first quarter of 2015 compared to net loan recoveries of $0.2 million for the first quarter of 2014 and net loan charge-offs of $0.6 million for the fourth quarter of 2014. The allowance for loan and lease losses represented 1.18% of outstanding loans and leases and 104% of non-performing loans at December 31, 2015 compared to 1.34% of outstanding loans and leases and 98% of non-performing loans at March 31, 2014. Non-performing loans includes accruing loans 90 days or more past due and restructured loans.

Income Statement Review

Net interest income for the first quarter of 2015 increased 6% compared to the first quarter of 2014. The net interest margin was 3.44% for the first quarter of 2015 compared to 3.47% for the first quarter of 2014.

The provision for loan and lease losses was a charge of $0.6 million for the first quarter of 2015 compared to a credit of $1.0 million for the first quarter of 2014 and a charge of $0.9 million for the fourth quarter of 2014. The current quarter's charge reflects the growth in the loan portfolio over the prior year quarter together with the increase in non-performing loans and loan charge-offs during the first quarter.

Non-interest income increased 17% to $13.2 million for the first quarter of 2015 compared to $11.2 million for the first quarter of 2014. The increase in non-interest income for the quarter compared to the prior year quarter was due primarily to increases in income from wealth management due to growth in assets under management and mortgage banking due primarily to higher mortgage origination volumes.

Non-interest expenses increased 6% to $29.2 million for the first quarter of 2015 compared to $27.5 million in the first quarter of 2014. The current quarter included increases in salaries and benefits and other non-interest expenses that were somewhat offset by a decline in intangibles amortization. The non-GAAP efficiency ratio was 60.53% for the first quarter of 2015 compared to 61.60% for the first quarter of 2014.

Conference Call

The Company's management will host a conference call to discuss its first quarter results today at 2:00 P.M. (ET). A live Web cast of the conference call is available through the Investor Relations' section of the Sandy Spring Web site at www.sandyspringbank.com. Participants may call 1-866-235-9910. A password is not necessary. Visitors to the Web site are advised to log on 10 minutes ahead of the scheduled start of the call. An internet-based replay will be available at the Web site until 9:00 am (ET) April 30, 2015. A replay of the teleconference will be available through the same time period by calling 1-877-344-7529 under conference call number 10063098.

About Sandy Spring Bancorp, Inc.

With $4.4 billion in assets, Sandy Spring Bancorp, Inc. is the holding company for Sandy Spring Bank and its principal subsidiaries, Sandy Spring Insurance Corporation and West Financial Services, Inc. Sandy Spring Bank traces its origin to 1868, making it among the oldest banking institutions in the region. Sandy Spring is a community banking organization that focuses its lending and other services on businesses and consumers in the local market area. Independent and community-oriented, Sandy Spring offers a broad range of commercial banking, retail banking and trust services through 44 community offices in Anne Arundel, Carroll, Frederick, Howard, Montgomery, and Prince George's counties in Maryland, and Arlington, Fairfax and Loudoun counties in Virginia. Through its subsidiaries, Sandy Spring Bank also offers a comprehensive menu of insurance and investment management services. Visit www.sandyspringbank.com for more information about Sandy Spring Bank.

Forward-Looking Statements

Sandy Spring Bancorp makes forward-looking statements in this news release and in the conference call regarding this news release. These forward-looking statements may include: statements of goals, intentions, earnings expectations, and other expectations; estimates of risks and of future costs and benefits; assessments of probable loan and lease losses; assessments of market risk; and statements of the ability to achieve financial and other goals.

Forward-looking statements are typically identified by words such as "believe," "expect," "anticipate," "intend," "outlook," "estimate," "forecast," "project" and other similar words and expressions. Forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made. Sandy Spring Bancorp does not assume any duty and does not undertake to update its forward-looking statements. Because forward-looking statements are subject to assumptions and uncertainties, actual results or future events could differ, possibly materially, from those that Sandy Spring Bancorp anticipated in its forward-looking statements and future results could differ materially from historical performance.

Sandy Spring Bancorp's forward-looking statements are subject to the following principal risks and uncertainties: general economic conditions and trends, either nationally or locally; conditions in the securities markets; changes in interest rates; changes in deposit flows, and in the demand for deposit, loan, and investment products and other financial services; changes in real estate values; changes in the quality or composition of the Company's loan or investment portfolios; changes in competitive pressures among financial institutions or from non-financial institutions; the Company's ability to retain key members of management; changes in legislation, regulations, and policies; and a variety of other matters which, by their nature, are subject to significant uncertainties. Sandy Spring Bancorp provides greater detail regarding some of these factors in its Form 10-K for the year ended December 31, 2014, including in the Risk Factors section of that report, and in its other SEC reports. Sandy Spring Bancorp's forward-looking statements may also be subject to other risks and uncertainties, including those that it may discuss elsewhere in this news release or in its filings with the SEC, accessible on the SEC's Web site at www.sec.gov.

Sandy Spring Bancorp, Inc. and Subsidiaries
FINANCIAL HIGHLIGHTS - UNAUDITED
Three Months Ended
March 31, %
(Dollars in thousands, except per share data) 2015 2014 Change
Results of Operations:
Net interest income $ 33,373 $ 31,592 6%
Provision (credit) for loan and lease losses 597 (982) (161)
Non-interest income 13,159 11,249 17
Non-interest expenses 29,244 27,549 6
Income before income taxes 16,691 16,274 3
Net income 11,225 10,928 3
 
Pre-tax pre-provision income $ 17,488 $ 15,292 14
 
Return on average assets 1.04% 1.08%
Return on average common equity 8.73% 8.80%
Net interest margin 3.44% 3.47%
Efficiency ratio - GAAP basis (1) 62.85% 64.31%
Efficiency ratio - Non-GAAP basis (1) 60.53% 61.60%
 
Per share data:  
Basic net income $ 0.45 $ 0.44 2%
Diluted net income $ 0.45 $ 0.43 5
Average fully diluted shares 25,048,576 25,124,206 --
Dividends declared per share $ 0.22 $ 0.18 22
Book value per share 21.10 20.38 4
Tangible book value per share 17.59 16.93 4
Outstanding shares 24,733,868 25,043,482 (1)
 
Financial Condition at period-end:  
Investment securities $ 912,565 $ 997,584 (9)%
Loans and leases 3,164,706 2,832,813 12
Interest-earning assets 4,125,549 3,891,223 6
Assets 4,401,380 4,168,998 6
Deposits 3,109,892 2,959,195 5
Interest-bearing liabilities 2,818,966 2,748,064 3
Stockholders' equity 521,768 510,386 2
 
Capital ratios:
Tier 1 leverage (4) 11.00% 11.43%
Tier 1 capital to risk-weighted assets (4) 14.01% 14.64%
Total regulatory capital to risk-weighted assets (4) 15.12% 15.85%
Common equity tier 1 capital to risk-weighted assets (4) 14.01% n.a.
Tangible common equity to tangible assets (2) 10.08% 10.38%
Average equity to average assets 11.92% 12.27%
 
Credit quality ratios:  
Allowance for loan and lease losses to loans and leases 1.18% 1.34%
Non-performing loans to total loans 1.14% 1.37%
Non-performing assets to total assets 0.89% 0.97%
Allowance for loan and lease losses to non-performing loans 104.05% 98.27%
Annualized net charge-offs to average loans and leases (3) 0.12% (0.04)%
(1) The efficiency ratio - GAAP basis is non-interest expenses divided by net interest income plus non-interest income from the Condensed Consolidated Statements of Income. The traditional efficiency ratio - Non-GAAP basis excludes intangible asset amortization from non-interest expense; securities gains (losses) from non-interest income; OTTI; and the tax-equivalent adjustment to net interest income. See the Reconciliation Table included with these Financial Highlights.
(2) The tangible common equity to tangible assets ratio is a non-GAAP ratio that divides assets excluding intangible assets into stockholders' equity after deducting intangible assets and other comprehensive gains (losses). See the Reconciliation Table included with these Financial Highlights.
(3) Calculation utilizes average loans and leases, excluding residential mortgage loans held-for-sale.
(4) Estimated ratio at March 31, 2015
Sandy Spring Bancorp, Inc. and Subsidiaries
RECONCILIATION TABLE - UNAUDITED
Three Months Ended
March 31,
(Dollars in thousands) 2015 2014
Pre-tax pre-provision income:
Net income $ 11,225 $ 10,928
Plus non-GAAP adjustment:
Litigation expenses 200 --
Income taxes 5,466 5,346
Provision (credit) for loan and lease losses 597 (982)
Pre-tax pre-provision income $ 17,488 $ 15,292
Efficiency ratio - GAAP basis:
Non-interest expenses $ 29,244 $ 27,549
Net interest income plus non-interest income $ 46,532 $ 42,841
Efficiency ratio - GAAP basis 62.85% 64.31%
Efficiency ratio - Non-GAAP basis:
Non-interest expenses $ 29,244 $ 27,549
Less non-GAAP adjustment:
Amortization of intangible assets 107 370
Litigation expenses 200 --
Non-interest expenses - as adjusted $ 28,937 $ 27,179
Net interest income plus non-interest income $ 46,532 $ 42,841
Plus non-GAAP adjustment:
Tax-equivalent income 1,271 1,282
Less non-GAAP adjustments:
Securities gains (losses) -- --
Net interest income plus non-interest income - as adjusted $ 47,803 $ 44,123
Efficiency ratio - Non-GAAP basis 60.53% 61.60%
Tangible common equity ratio:
Total stockholders' equity $ 521,768 $ 510,386
Accumulated other comprehensive income (2,146) (1,350)
Goodwill (84,171) (84,171)
Other intangible assets, net (403) (960)
Tangible common equity $ 435,048 $ 423,905
Total assets $ 4,401,380 $ 4,168,998
Goodwill (84,171) (84,171)
Other intangible assets, net (403) (960)
Tangible assets $ 4,316,806 $ 4,083,867
Tangible common equity ratio 10.08% 10.38%
Outstanding common shares 24,733,868 25,043,482
Tangible book value per common share $ 17.59 $ 16.93
Sandy Spring Bancorp, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION - UNAUDITED
March 31, December 31, March 31,
(Dollars in thousands) 2015 2014 2014
Assets
Cash and due from banks $ 46,771 $ 52,804 $ 58,448
Federal funds sold 473 473 474
Interest-bearing deposits with banks 33,906 42,940 57,273
Cash and cash equivalents 81,150 96,217 116,195
Residential mortgage loans held for sale (at fair value) 13,899 10,512 3,079
Investments available-for-sale (at fair value) 657,709 672,209 736,270
Investments held-to-maturity -- fair value of $221,687, $222,260 and $220,693 at March 31, 2015, December 31, 2014 and March 31, 2014, respectively 217,557 219,973 223,747
Other equity securities 37,299 41,437 37,567
Total loans and leases 3,164,706 3,127,392 2,832,813
Less: allowance for loan and lease losses (37,475) (37,802) (38,026)
Net loans and leases 3,127,231 3,089,590 2,794,787
Premises and equipment, net 51,299 49,402 45,644
Other real estate owned 3,227 3,195 1,619
Accrued interest receivable 12,505 12,634 12,288
Goodwill 84,171 84,171 84,171
Other intangible assets, net 403 510 960
Other assets 114,930 117,282 112,671
Total assets $ 4,401,380 $ 4,397,132 $ 4,168,998
Liabilities
Noninterest-bearing deposits $ 1,017,566 $ 993,737 $ 882,169
Interest-bearing deposits 2,092,326 2,072,772 2,077,026
Total deposits 3,109,892 3,066,509 2,959,195
Securities sold under retail repurchase agreements and federal funds purchased 101,640 74,432 67,038
Advances from FHLB 590,000 655,000 569,000
Subordinated debentures 35,000 35,000 35,000
Accrued interest payable and other liabilities 43,080 44,440 28,379
Total liabilities 3,879,612 3,875,381 3,658,612
Stockholders' Equity
Common stock -- par value $1.00; shares authorized 50,000,000; shares issued and outstanding 24,733,868, 25,044,877 and 25,043,482 at March 31, 2015, December 31, 2014 and March 31, 2014, respectively 24,734 25,045 25,043
Additional paid in capital 186,342 194,647 193,708
Retained earnings 308,546 302,882 290,285
Accumulated other comprehensive income (loss) 2,146 (823) 1,350
Total stockholders' equity 521,768 521,751 510,386
Total liabilities and stockholders' equity $ 4,401,380 $ 4,397,132 $ 4,168,998
Sandy Spring Bancorp, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
Three Months Ended
March 31,
(Dollars in thousands, except per share data) 2015 2014
Interest Income:
Interest and fees on loans and leases $ 32,139 $ 29,734
Interest on loans held for sale 76 59
Interest on deposits with banks 22 20
Interest and dividends on investment securities:
Taxable 3,577 4,116
Exempt from federal income taxes 2,258 2,321
Total interest income 38,072 36,250
Interest Expense:
Interest on deposits 1,194 1,184
Interest on retail repurchase agreements and federal funds purchased 50 38
Interest on advances from FHLB 3,236 3,218
Interest on subordinated debt 219 218
Total interest expense 4,699 4,658
Net interest income 33,373 31,592
Provision (credit) for loan and lease losses 597 (982)
Net interest income after provision (credit) for loan and lease losses 32,776 32,574
Non-interest Income:
Investment securities gains (losses) -- --
Service charges on deposit accounts 1,882 1,972
Mortgage banking activities 1,178 316
Wealth management income 4,916 4,466
Insurance agency commissions 1,618 1,640
Income from bank owned life insurance 713 598
Bank card fees 1,057 978
Other income 1,795 1,279
Total non-interest income 13,159 11,249
Non-interest Expenses:
Salaries and employee benefits 17,299 16,355
Occupancy expense of premises 3,489 3,472
Equipment expenses 1,373 1,256
Marketing 531 542
Outside data services 1,261 1,216
FDIC insurance 631 520
Amortization of intangible assets 107 370
Litigation expenses 200 --
Other expenses 4,353 3,818
Total non-interest expenses 29,244 27,549
Income before income taxes 16,691 16,274
Income tax expense 5,466 5,346
Net income $ 11,225 $ 10,928
Net Income Per Share Amounts:
Basic net income per share $ 0.45 $ 0.44
Diluted net income per share $ 0.45 $ 0.43
Dividends declared per share $ 0.22 $ 0.18
Sandy Spring Bancorp, Inc. and Subsidiaries
HISTORICAL TRENDS - QUARTERLY FINANCIAL DATA - UNAUDITED
  2015 2014
(Dollars in thousands, except per share data) Q1 Q4 Q3 Q2 Q1
Profitability for the Quarter:
Tax-equivalent interest income $ 39,343 $ 39,258 $ 38,446 $ 38,322 $ 37,532
Interest expense 4,699 4,748 4,730 4,682 4,658
Tax-equivalent net interest income 34,644 34,510 33,716 33,640 32,874
Tax-equivalent adjustment 1,271 1,283 1,296 1,331 1,282
Provision for loan and lease losses 597 853 (192) 158 (982)
Non-interest income 13,159 11,338 12,590 11,694 11,249
Non-interest expenses 29,244 30,478 28,632 34,141 27,549
Income before income taxes 16,691 13,234 16,570 9,704 16,274
Income tax expense 5,466 4,086 5,428 2,722 5,346
Net income $ 11,225 $ 9,148 $ 11,142 $ 6,982 $ 10,928
Financial Performance:
Pre-tax pre-provision income $ 17,488 $ 14,242 $ 16,614 $ 15,990 $ 15,292
Return on average assets 1.04% 0.85% 1.05% 0.67% 1.08%
Return on average common equity 8.73% 6.93% 8.54% 5.47% 8.80%
Net interest margin 3.44% 3.44% 3.42% 3.48% 3.47%
Efficiency ratio - GAAP basis (1) 62.85% 68.39% 63.61% 77.59% 64.31%
Efficiency ratio - Non-GAAP basis (1) 60.53% 65.89% 61.09% 61.30% 61.60%
Per Share Data:
Basic net income per share $ 0.45 $ 0.37 $ 0.44 $ 0.28 $ 0.44
Diluted net income per share $ 0.45 $ 0.36 $ 0.44 $ 0.28 $ 0.43
Average fully diluted shares 25,048,576 25,151,831 25,151,582 25,127,036 25,124,206
Dividends declared per common share $ 0.22 $ 0.20 $ 0.20 $ 0.18 $ 0.18
Non-interest Income:
Securities gains (losses) $ -- $ (3) $ 8 $ -- $ --
Service charges on deposit accounts 1,882 2,135 2,226 2,089 1,972
Mortgage banking activities 1,178 512 596 570 316
Wealth management income 4,916 4,905 4,974 4,741 4,466
Insurance agency commissions 1,618 985 1,410 961 1,640
Income from bank owned life insurance 713 627 611 608 598
Bank card fees 1,057 1,144 1,148 1,169 978
Other income 1,795 1,033 1,617 1,556 1,279
Total Non-interest Income $ 13,159 $ 11,338 $ 12,590 $ 11,694 $ 11,249
Non-interest Expense:
Salaries and employee benefits $ 17,299 $ 16,793 $ 16,765 $ 16,474 $ 16,355
Occupancy expense of premises 3,489 3,914 3,032 3,274 3,472
Equipment expenses 1,373 1,333 1,337 1,262 1,256
Marketing 531 838 744 802 542
Outside data services 1,261 1,284 1,231 1,216 1,216
FDIC insurance 631 615 594 573 520
Amortization of intangible assets 107 112 115 224 370
Litigation expenses 200 155 236 6,128 --
Professional fees 1,209 1,246 1,092 1,292 914
Other real estate owned expenses 10 2 40 9 --
Other expenses 3,134 4,186 3,446 2,887 2,904
Total Non-interest Expense $ 29,244 $ 30,478 $ 28,632 $ 34,141 $ 27,549
(1) The efficiency ratio - GAAP basis is non-interest expenses divided by net interest income plus non-interest income from the Condensed Consolidated Statements of Income. The traditional, efficiency ratio - non-GAAP basis excludes intangible asset amortization from non-interest expense; excludes securities gains; OTTI losses from non-interest income; and adds the tax-equivalent adjustment to net interest income. See the Reconciliation Table included with these Financial Highlights.
Sandy Spring Bancorp, Inc. and Subsidiaries
HISTORICAL TRENDS - QUARTERLY FINANCIAL DATA - UNAUDITED
  2015 2014
(Dollars in thousands) Q1 Q4 Q3 Q2 Q1
Balance Sheets at Quarter End:
Residential mortgage loans $ 728,858 $ 717,886 $ 698,925 $ 668,536 $ 640,939
Residential construction loans 130,321 136,741 141,883 149,321 143,109
Commercial ADC loans 203,731 205,124 194,666 178,972 163,343
Commercial investor real estate loans 668,931 640,193 575,984 577,813 573,634
Commercial owner occupied real estate loans 618,846 611,061 584,964 581,795 582,472
Commercial business loans 385,452 390,781 368,611 357,472 348,180
Leasing 36 54 156 260 439
Consumer loans 428,531 425,552 410,723 396,775 380,697
Total loans and leases 3,164,706 3,127,392 2,975,912 2,910,944 2,832,813
Allowance for loan and lease losses (37,475) (37,802) (37,574) (37,959) (38,026)
Investment securities 912,565 933,619 950,869 980,530 997,584
Interest-earning assets 4,125,549 4,114,936 3,976,731 3,945,643 3,891,223
Total assets 4,401,380 4,397,132 4,248,731 4,234,342 4,168,998
Noninterest-bearing demand deposits 1,017,566 993,737 986,549 984,700 882,169
Total deposits 3,109,892 3,066,509 3,028,788 3,038,670 2,959,195
Customer repurchase agreements 101,640 74,432 71,384 72,917 67,038
Total interest-bearing liabilities 2,818,966 2,837,204 2,706,623 2,698,887 2,748,064
Total stockholders' equity 521,768 521,751 522,404 517,269 510,386
Quarterly Average Balance Sheets:
Residential mortgage loans $ 731,301 $ 717,671 $ 689,531 $ 659,172 $ 633,160
Residential construction loans 132,456 141,890 147,750 145,968 134,261
Commercial ADC loans 206,105 201,020 180,293 168,063 162,544
Commercial investor real estate loans 645,163 607,050 577,851 575,283 557,168
Commercial owner occupied real estate loans 611,722 594,634 585,014 579,953 584,155
Commercial business loans 383,111 367,872 367,203 348,597 349,734
Leasing 44 114 206 352 567
Consumer loans 425,434 417,910 404,062 390,076 377,822
Total loans and leases 3,135,336 3,048,161 2,951,910 2,867,464 2,799,411
Investment securities 925,683 942,782 965,206 991,135 1,012,701
Interest-earning assets 4,097,648 4,022,051 3,954,858 3,893,843 3,845,513
Total assets 4,372,988 4,292,237 4,220,084 4,157,559 4,105,225
Noninterest-bearing demand deposits 986,688 1,000,285 956,830 899,287 825,968
Total deposits 3,056,186 3,063,591 3,036,686 2,965,329 2,876,641
Customer repurchase agreements 90,020 78,746 73,046 68,880 62,864
Total interest-bearing liabilities 2,817,575 2,731,791 2,711,206 2,716,537 2,749,459
Total stockholders' equity 521,346 524,063 517,534 511,738 503,851
Financial Measures:
Average equity to average assets 11.92% 12.21% 12.26% 12.31% 12.27%
Investment securities to earning assets 22.12% 22.69% 23.91% 24.85% 25.64%
Loans to earning assets 76.71% 76.00% 74.83% 73.78% 72.80%
Loans to assets 71.90% 71.12% 70.04% 68.75% 67.95%
Loans to deposits 101.76% 101.99% 98.25% 95.80% 95.73%
Capital Measures:
Tier 1 leverage (1) 11.00% 11.26% 11.36% 11.37% 11.43%
Tier 1 capital to risk-weighted assets (1) 14.01% 13.95% 14.52% 14.48% 14.64%
Total regulatory capital to risk-weighted assets (1) 15.12% 15.06% 15.68% 15.66% 15.85%
Common equity tier 1 capital to risk-weighted assets (1) 14.01% n.a. n.a. n.a. n.a.
Book value per share $ 21.10 $ 20.83 $ 20.83 $ 20.63 $ 20.38
Outstanding shares 24,733,868 25,044,877 25,076,794 25,069,700 25,043,482
(1) Estimated ratio at March 31, 2015
Sandy Spring Bancorp, Inc. and Subsidiaries
LOAN PORTFOLIO QUALITY DETAIL - UNAUDITED
2015 2014
(Dollars in thousands) March 31, December 31, September 30, June 30, March 31,
Non-Performing Assets:
Loans and leases 90 days past due:
Commercial business $ -- $ -- $ -- $ 1 $ --
Commercial real estate:
Commercial AD&C -- -- -- -- --
Commercial investor real estate -- -- -- -- --
Commercial owner occupied real estate -- -- 649 -- --
Leasing -- -- -- -- --
Consumer -- -- 6 3 --
Residential real estate:
Residential mortgage -- -- -- -- --
Residential construction -- -- -- -- --
Total loans and leases 90 days past due -- -- 655 4 --
Non-accrual loans and leases:
Commercial business 4,166 3,184 4,151 4,309 3,272
Commercial real estate:
Commercial AD&C 1,363 2,464 3,792 3,739 4,133
Commercial investor real estate 10,083 8,156 8,210 6,731 7,284
Commercial owner occupied real estate 8,974 8,941 10,742 10,868 7,150
Leasing -- -- -- -- --
Consumer 1,962 1,668 1,830 2,058 2,115
Residential real estate:
Residential mortgage 3,235 3,012 4,417 4,501 5,025
Residential construction 788 1,105 2,497 2,143 2,304
Total non-accrual loans and leases 30,571 28,530 35,639 34,349 31,283
Total restructured loans - accruing 5,446 5,497 7,382 7,364 7,411
Total non-performing loans and leases 36,017 34,027 43,676 41,717 38,694
Other assets and real estate owned (OREO) 3,227 3,195 1,762 1,967 1,619
Total non-performing assets $ 39,244 $ 37,222 $ 45,438 $ 43,684 $ 40,313
For the quarter ended,
March 31, December 31, September 30, June 30, March 31,
(Dollars in thousands) 2015 2014 2014 2014 2014
Analysis of Non-accrual Loan and Lease Activity:
Balance at beginning of period $ 28,530 $ 35,639 $ 34,349 $ 31,283 $ 30,574
Non-accrual balances transferred to OREO (32) (1,475) (300) (390) (281)
Non-accrual balances charged-off (1,077) (1,033) (216) (357) (513)
Net payments or draws (1,067) (4,139) (590) (1,580) (1,073)
Loans placed on non-accrual 4,217 779 2,396 5,393 2,576
Non-accrual loans brought current -- (1,241) -- -- --
Balance at end of period $ 30,571 $ 28,530 $ 35,639 $ 34,349 $ 31,283
Analysis of Allowance for Loan Losses:
Balance at beginning of period $ 37,802 $ 37,574 $ 37,959 $ 38,026 $ 38,766
Provision (credit) for loan and lease losses 597 853 (192) 158 (982)
Less loans charged-off, net of recoveries:
Commercial business (89) 50 (58) 28 (768)
Commercial real estate:
Commercial AD&C 706 529 -- -- --
Commercial investor real estate (5) (5) (2) (23) (5)
Commercial owner occupied real estate 212 (6) -- 265 --
Leasing -- -- -- -- --
Consumer 43 83 244 11 331
Residential real estate:
Residential mortgage 65 (17) 43 (27) 203
Residential construction (8) (9) (34) (29) (3)
Net charge-offs 924 625 193 225 (242)
Balance at end of period $ 37,475 $ 37,802 $ 37,574 $ 37,959 $ 38,026
Asset Quality Ratios:
Non-performing loans to total loans 1.14% 1.09% 1.47% 1.43% 1.37%
Non-performing assets to total assets 0.89% 0.85% 1.07% 1.03% 0.97%
Allowance for loan losses to loans 1.18% 1.21% 1.26% 1.30% 1.34%
Allowance for loan losses to non-performing loans 104.05% 111.09% 86.03% 90.99% 98.27%
Annualized net charge-offs to average loans 0.12% 0.08% 0.03% 0.03% (0.04)%
Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES - UNAUDITED
Three Months Ended March 31,
2015 2014
Annualized Annualized
Average (1) Average Average (1) Average
(Dollars in thousands and tax-equivalent) Balances Interest Yield/Rate Balances Interest Yield/Rate
Assets
Residential mortgage loans (2) $ 731,301 $ 6,200 3.39% $ 633,160 $ 5,506 3.48%
Residential construction loans 132,456 1,221 3.74 134,261 1,254 3.79
Commercial ADC loans 206,105 2,337 4.60 162,544 2,073 5.17
Commercial investor real estate loans 645,163 7,579 4.76 557,168 6,733 4.90
Commercial owner occupied real estate loans 611,722 7,165 4.99 584,155 7,067 5.08
Commercial business loans 383,111 4,212 4.38 349,734 4,037 4.64
Leasing 44 1 5.19 567 6 4.53
Consumer loans 425,434 3,500 3.36 377,822 3,117 3.37
Total loans and leases (3) 3,135,336 32,215 4.19 2,799,411 29,793 4.34
Taxable securities 629,266 3,936 2.54 710,246 4,452 2.51
Tax-exempt securities (4) 296,417 3,170 4.34 302,455 3,267 4.32
Interest-bearing deposits with banks 36,155 22 0.25 32,925 20 0.25
Federal funds sold 474 -- 0.22 476 -- 0.22
Total interest-earning assets 4,097,648 39,343 3.90 3,845,513 37,532 3.96
Less: allowance for loan and lease losses (37,444) (39,393)
Cash and due from banks 46,430 45,553
Premises and equipment, net 50,658 45,879
Other assets 215,696 207,662
Total assets $ 4,372,988 $4,105,214
Liabilities and Stockholders' Equity
Interest-bearing demand deposits $ 524,059 106 0.08% $ 460,245 92 0.08%
Regular savings deposits 270,198 34 0.05 249,185 48 0.08
Money market savings deposits 831,707 273 0.13 877,864 273 0.13
Time deposits 443,534 781 0.71 463,379 771 0.67
Total interest-bearing deposits 2,069,498 1,194 0.23 2,050,673 1,184 0.23
Other borrowings 90,188 50 0.22 62,864 38 0.24
Advances from FHLB 622,889 3,236 2.11 600,922 3,218 2.17
Subordinated debentures 35,000 219 2.50 35,000 218 2.49
Total interest-bearing liabilities 2,817,575 4,699 0.68 2,749,459 4,658 0.69
Noninterest-bearing demand deposits 986,688 825,968
Other liabilities 47,379 25,936
Stockholders' equity 521,346 503,851
Total liabilities and stockholders' equity $ 4,372,988 $4,105,214
Net interest income and spread $ 34,644 3.22% $ 32,874 3.27%
Less: tax-equivalent adjustment 1,271 1,282
Net interest income $ 33,373 $ 31,592
Interest income/earning assets 3.90% 3.96%
Interest expense/earning assets 0.46 0.49
Net interest margin 3.44% 3.47%
(1) Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 39.88% for 2015 and 2014. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to $1.3 million and $1.3 million in 2015 and 2014, respectively.
(2) Includes residential mortgage loans held for sale. Home equity loans and lines are classified as consumer loans.
(3) Non-accrual loans are included in the average balances.
(4) Includes only investments that are exempt from federal taxes.

CONTACT: For additional information or questions, please contact: Daniel J. Schrider, President & Chief Executive Officer, or Philip J. Mantua, E.V.P. & Chief Financial Officer Sandy Spring Bancorp 17801 Georgia Avenue Olney, Maryland 20832 1-800-399-5919 Email: DSchrider@sandyspringbank.com PMantua@sandyspringbank.com Web site: www.sandyspringbank.com

Source:Sandy Spring Bancorp, Inc.