Sandy Spring Bancorp, Inc. says no impact from sub-prime problems
After announcing a slight increase in net income for the second quarter ended May 31, Sandy Spring Bancorp., Inc. (Nasdaq: SASR) said on an afternoon conference call that the Olney, Md.-based company has not been affected by the sub-prime problems plaguing other banks.
“Our only involvement with sub-primes is that we have originated sub-prime mortgage loans strictly for other investors,” CEO Hunter Hollar said on the call. “We’ve sold those off and keep none of those loans in our portfolio.”
At today’s opening bell, Sandy Spring reported second-quarter net income of $8.2 million, or $0.51 per share, compared with $8.1 million, or $0.54 per share, a year earlier. The bank’s second quarter results included after-tax merger costs of $0.4 million, after acquiring CN Bancorp, Inc. in late May. Net interest income for the quarter totaled $26.2 million, compared with $23.9 million in the year-ago period.
Wall Street analysts were expecting EPS of $0.53 on revenue of $38.4 million.
“The costs associated with closing two mergers during the first half of 2007 should now be entirely behind us as we move into the second half of the year with good momentum and an expanded platform in two new markets,” Hollar said.
As of May 31, the company had $139 million in deposits, $99 million in loans and total earning assets of $150 million.
With Sandy Spring’s stock price hovering around a four-year low, several investors on the conference call urged the company to buy back shares.
“It seems like you guys at these levels should be looking at a buyback more actively,” Jennifer Demba, bank analyst for investment firm SunTrust Robinson Humphrey, said.
Hollar disagreed.
“We have a repurchase plan in place approved by the board. Our attitude toward that is that we have stated our intention to be open to acquisitions,” Hollar said. “Our powder needs to remain dry to take advantage of those opportunities which we think there will be in the coming quarters.”
In late afternoon trading, shares of Sandy Spring are down $0.42, or 1.38%, at $30.10. Over the last 52 weeks, shares of the company have ranged between $29.34 and $39.12.
