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The Bancorp, Inc. Reports First Quarter Financial Results
Recent Developments
The Bancorp has increased its share repurchase authorization for the second quarter of 2024 from $50.0 million to $100.0 million. In April 2024, the Company began purchasing additional fixed rate agency backed commercial and residential mortgage securities of varying maturities, with an approximate 5.11% weighted average yield, and estimated weighted average lives of eight years, to reduce its exposure to lower levels of net interest income, should the Federal Reserve begin decreasing rates. Such purchases would also reduce the additional net interest income which would result should the Federal Reserve increase rates. Through April 26, 2024, the Company purchased approximately $900 million of such securities. While there are many variables and limitations to estimating exposure to changes in rates, such purchases and continuing fixed rate loan originations are projected to reduce such exposure to modest levels. We are pleased to announce Block, Inc. ("Block") as a new partner to our fintech solutions ecosystem. The addition of this new relationship as well as the continued organic growth of the current portfolio should result in meaningful increases to the ACH, card and other processing fees line item.
Highlights
The Bancorp reported net income of $56.4 million, or $1.06 per diluted share ("EPS"), for the quarter ended March 31, 2024, compared to net income of $49.1 million, or $0.88 per diluted share, for the quarter ended March 31, 2023, or an EPS increase of 20%. While net income increased 15% between these periods, outstanding shares were decreased as a result of common stock share repurchases which have been significantly increased in 2024. Return on assets and equity for the quarter ended March 31, 2024, amounted to 3.0% and 28%, respectively, compared to 2.6% and 28%, respectively, for the quarter ended March 31, 2023 (all percentages "annualized"). Net interest income increased 10% to $94.4 million for the quarter ended March 31, 2024, compared to $85.8 million for the quarter ended March 31, 2023. Net interest income increases reflected the impact of Federal Reserve rate increases on The Bancorp's variable rate loans and securities. Net interest margin amounted to 5.15% for the quarter ended March 31, 2024, compared to 4.67% for the quarter ended March 31, 2023, and 5.26% for the quarter ended December 31, 2023. As noted above, the Company has begun purchasing fixed rate securities to reduce margin exposure to lower rate environments. Loans, net of deferred fees and costs were $5.46 billion at March 31, 2024, compared to $5.36 billion at December 31, 2023 and $5.35 billion at March 31, 2023. Those changes reflected an increase of 2% quarter over linked quarter and an increase of 2% year over year. Gross dollar volume ("GDV"), representing the total amounts spent on prepaid and debit cards, increased $3.93 billion, or 12%, to $37.94 billion for the quarter ended March 31, 2024, compared to the quarter ended March 31, 2023. The increase reflects continued organic growth with existing partners and the impact of clients added within the past year. Total prepaid, debit card, ACH, and other payment fees increased 7% to $27.3 million for the first quarter of 2024 compared to the first quarter of 2023. After adjusting first quarter 2023 for $600,000 of fees related to a prior period and a $1.4 million termination fee from a client which formed its own bank, those fees increased 16%. Small business loans ("SBL"), including those held at fair value, amounted to $925.3 million at March 31, 2024, or 14% higher year over year, and 3% quarter over linked quarter, excluding the impact of $28.7 million of loans with related secured borrowings. Direct lease financing balances increased 8% year over year to $702.5 million at March 31, 2024, and 2% over December 31, 2023. At March 31, 2024, real estate bridge loans of $2.10 billion had grown 5% compared to the $2.00 billion balance at December 31, 2023, and 20% compared to the March 31, 2023 balance of $1.75 billion. These real estate bridge loans consist entirely of rehabilitation loans for apartment buildings. Security backed lines of credit ("SBLOC"), insurance backed lines of credit ("IBLOC") and investment advisor financing loans collectively decreased 21% year over year and decreased 4% quarter over linked quarter to $1.78 billion at March 31, 2024. The average interest rate on $6.65 billion of average deposits and interest-bearing liabilities during the first quarter of 2024 was 2.49%. Average deposits of $6.50 billion for the first quarter of 2024 reflected a decrease of 2% from the $6.62 billion of average deposits for the quarter ended March 31, 2023. The decreases reflected the planned exit of $200 million of higher cost funds on July 1, 2023 and other planned exits of higher cost funds throughout the year. As of March 31, 2024, tier one capital to assets (leverage), tier one capital to risk-weighted assets, total capital to risk-weighted assets and common equity-tier 1 to risk-weighted assets ratios were 10.87%, 15.76%, 16.35% and 15.76%, respectively, compared to well-capitalized minimums of 5%, 8%, 10% and 6.5%, respectively. The Bancorp and its wholly-owned subsidiary, The Bancorp Bank, National Association, each remain well capitalized under banking regulations. Book value per common share at March 31, 2024 was $15.63 compared to $13.11 per common share at March 31, 2023, an increase of 19%. The Bancorp repurchased 1,262,212 shares of its common stock at an average cost of $39.61 per share during the quarter ended March 31, 2024. The Bancorp emphasizes safety and soundness and its balance sheet has a risk profile enhanced by the special nature of the collateral supporting its loan niches, related underwriting, and the characteristics of its funding sources, including those highlighted in the bullets below. Those loan niches and funding sources have contributed to increased earnings levels, even during periods in which markets have experienced various economic stresses. The vast majority of The Bancorp's funding is comprised of FDIC-insured and/or small balance accounts, which adjust to only a portion of changes in rates. The Bancorp also has lines of credit with U.S. government agencies totaling approximately $2.7 billion as of March 31, 2024, as well as access to other forms of liquidity. In prior years, The Bancorp deferred adding fixed rate securities when yields were particularly low, which has afforded the flexibility to benefit from, and secure, more advantageous securities and loan rates. The $2.1 billion apartment bridge lending portfolio has a weighted average origination date "as is" LTV of 70%, based on third party appraisals. Further, the weighted average origination date "as stabilized" LTV, which measures the estimated value of the apartments after the rehabilitation is complete may provide even greater protection. In its real estate bridge lending portfolio, The Bancorp has minimal exposure to non-multifamily commercial real estate such as office buildings, and instead has a portfolio largely comprised of rehabilitation bridge loans for apartment buildings. These loans generally have three year terms with two one-year extensions to allow for the rehabilitation work to be completed and rentals stabilized for an extended period, before being refinanced at lower rates through U.S. Government Sponsored Entities or other lenders. The rehabilitation real estate lending portfolio consists primarily of workforce housing, which we consider to be working class apartments at more affordable rental rates. Related collateral values should accordingly be more stable than higher rent properties, even in stressed economies. While the macro-economic environment has challenged the multifamily bridge space, the stability of The Bancorp's rehabilitation bridge loan portfolio is evidenced by the estimated values of collateral for loans that have been classified as substandard. Recent third party appraisals of those loans reflect a weighted average "as is" loan to value ratio ("LTV") of 79% and an "as stabilized" LTV of 76%. Accordingly, even with a higher interest rate environment and other stresses, LTVs for these loans have been significantly sustained and continue to provide protection against potential loss. As part of the underwriting process, The Bancorp reviews borrowers' previous rehabilitation experience in addition to overall financial wherewithal. These transactions also include significant borrower equity contributions with required performance metrics. Underwriting generally includes, but is not limited to, assessment of local market information relating to vacancy and rental rates, review of post rehabilitation rental rate assumptions against geo-specific affordability indices, negative news and lien searches, visitations by bank personnel and/or designated engineers, and other information sources. Rehabilitation progress is monitored through ongoing draw requests and financial reporting covenants. This generally allows for early identification of potential issues, and expedited action to address on a timely basis. Operations and ongoing loan evaluation are overseen by multiple levels of management, in addition to the real estate bridge lending team's experienced professional staff and third party consultants utilized during the underwriting and asset management process. This oversight includes a separate loan committee specific to real estate bridge lending, which is comprised of seasoned and experienced lending professionals who do not directly report to anyone on the real estate bridge lending team. There is also a separate loan review department, a surveillance committee and additional staff which evaluate potential losses under the current expected credit losses methodology ("CECL"), all of which similarly do not report to anyone on the real estate bridge lending team. SBLOC and IBLOC portfolios are respectively secured by marketable securities and the cash value of life insurance. The majority of SBA 7(a) loans are government guaranteed, while SBA 504 loans are made with 50-60% LTV's. Additional details regarding our loan portfolios are included in the related tables in this press release, as is the summarization of the earnings contributions of our payments businesses, which further enhances The Bancorp's risk profile. The Company's risk profile inherent in its loan portfolios, funding and earnings levels, may present opportunities to further increase shareholder value, while still prudently maintaining capital levels. Such opportunities include the recently increased planned stock repurchases noted above.
CEO and President Damian Kozlowski commented, "We had another quarter of continued progress and a strong start to 2024 with earnings of $1.06 a share and an ROE of 28%," said Damian Kozlowski CEO and President of The Bancorp. "We expect continued increases in volumes and profitability throughout 2024 and beyond as we continue to invest and build our capabilities for the future, while adding new business partners and expanding our current client relationships. We are also reaffirming our 2024 guidance of $4.25 a share without the impact of $50 million per quarter of share buybacks and the additional $50 million buyback in the second quarter."
Conference Call Webcast
You may access the LIVE webcast of The Bancorp's Quarterly Earnings Conference Call at 8:00 AM ET Friday, April 26, 2024 by clicking on the webcast link on The Bancorp's homepage at www.thebancorp.com. Or you may dial 1.800.267.6316, conference code BANCORP. You may listen to the replay of the webcast following the live call on The Bancorp's investor relations website or telephonically until Friday, May 3, 2024 by dialing 1.800.938.2241, access code BANCORP.
About The Bancorp
The Bancorp, Inc. (NASDAQ: TBBK), headquartered in Wilmington, Delaware, through its subsidiary, The Bancorp Bank, National Association, (or "The Bancorp Bank, N.A.") provides non-bank financial companies with the people, processes, and technology to meet their unique banking needs. Through its Fintech Solutions, Institutional Banking, Commercial Lending, and Real Estate Bridge Lending businesses, The Bancorp provides partner-focused solutions paired with cutting-edge technology for companies that range from entrepreneurial startups to Fortune 500 companies. With over 20 years of experience, The Bancorp has become a leader in the financial services industry, earning recognition as the #1 issuer of prepaid cards in the U.S., a nationwide provider of bridge financing for real estate capital improvement plans, an SBA National Preferred Lender, a leading provider of securities-backed lines of credit, with one of the few bank-owned commercial vehicle leasing groups. By its company-wide commitment to excellence, The Bancorp has also been ranked as one of the 100 Fastest-Growing Companies by Fortune, a Top 50 Employer by Equal Opportunity Magazine and was selected to be included in the S&P Small Cap 600. For more about The Bancorp, visit https://thebancorp.com/.
Forward-Looking Statements
Statements in this earnings release regarding The Bancorp's business which are not historical facts are "forward-looking statements." These statements may be identified by the use of forward-looking terminology, including but not limited to the words "intend," "may," "believe," "will," "expect," "look," "anticipate," "plan," "estimate," "continue," or similar words. These statements, including, without limitation, statements regarding our annual fiscal 2024 results, profitability, and increased volumes, relate to our current assumptions, projections, and expectations about our business and future events, including current expectations about important economic, political, and technological factors, among others, and are subject to risks and uncertainties, which could cause the actual results, events, or achievements to differ materially from those set forth in or implied by the forward-looking statements and related assumptions. For further discussion of the risks and uncertainties to which these forward-looking statements may be subject, see The Bancorp's filings with the Securities and Exchange Commission, including the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and other documents that the Company files from time to time with the Securities and Exchange Commission. The forward-looking statements speak only as of the date of this press release. The Bancorp does not undertake to publicly revise or update forward-looking statements in this press release to reflect events or circumstances that arise after the date of this press release, except as may be required under applicable law.
The Bancorp, Inc.
Financial highlights
(unaudited)
Three months ended Year ended
March 31, December 31,
Consolidated condensed income statements 2024 2023 2023
---------------------------------------- ---------------------------------------- ----------------------------------------
(Dollars in thousands, except per share and share data)
Net interest income $ 94,418 $ 85,816 $ 354,052
Provision for credit losses on loans 2,169 1,903 8,330
Provision for credit loss on security -- -- 10,000
-------------------- -------------------- -------------------- -------------------- -------------------- --------------------
Non-interest income
2,964 2,171 9,822
ACH, card and other payment processing fees
24,286 23,323 89,417
Prepaid, debit card and related fees
Net realized and unrealized gains on commercial
1,096 1,725 3,745
loans, at fair value
388 1,490 6,324
Leasing related income
648 280 2,786
Other non-interest income
-------------------- -------------------- -------------------- -------------------- -------------------- --------------------
Total non-interest income 29,382 28,989 112,094
Non-interest expense
30,280 29,785 121,055
Salaries and employee benefits
1,421 1,321 5,447
Data processing expense
821 958 3,850
Legal expense
845 955 2,957
FDIC insurance
4,489 4,237 17,349
Software
8,856 10,774 40,384
Other non-interest expense
-------------------- -------------------- -------------------- -------------------- -------------------- --------------------
Total non-interest expense 46,712 48,030 191,042
-------------------- -------------------- -------------------- -------------------- -------------------- --------------------
74,919 64,872 256,774
Income before income taxes
18,490 15,750 64,478
Income tax expense
-------------------- -------------------- -------------------- -------------------- -------------------- --------------------
Net income 56,429 49,122 192,296
==================== ==================== ==================== ==================== ==================== ====================
Net income per share - basic $ 1.07 $ 0.89 $ 3.52
==================== ==================== ==================== ==================== ==================== ====================
Net income per share - diluted $ 1.06 $ 0.88 $ 3.49
==================== ==================== ==================== ==================== ==================== ====================
Weighted average shares - basic 52,747,140 55,452,815 54,506,065
Condensed consolidated balance sheets March 31, December 31, September 30, March 31,
2024 (unaudited) 2023 2023 (unaudited) 2023 (unaudited)
------------------------------------------------------ -------------------------------------------------- -------------------------------------------------- --------------------------------------------------
(Dollars in thousands, except share data)
Assets:
Cash and cash equivalents
$ 9,105 $ 4,820 $ 4,881 $ 13,736
Cash and due from banks
1,241,363 1,033,270 898,533 773,446
Interest earning deposits at Federal Reserve Bank
-------------------- -------------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- --------------------
1,250,468 1,038,090 903,414 787,182
Total cash and cash equivalents
-------------------- -------------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- --------------------
Investment securities, available-for-sale, at fair value, net of $10.0 million allowance for credit loss 718,247 747,534 756,636 787,429
Commercial loans, at fair value 282,998 332,766 379,603 493,334
5,459,344 5,361,139 5,198,972 5,354,347
Loans, net of deferred fees and costs
(28,741 ) (27,378 ) (24,145 ) (23,794 )
Allowance for credit losses
-------------------- -------------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- --------------------
Loans, net 5,430,603 5,333,761 5,174,827 5,330,553
-------------------- -------------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- --------------------
Federal Home Loan Bank, Atlantic Central Bankers Bank, and Federal Reserve Bank stock 15,642 15,591 20,157 12,629
Premises and equipment, net 27,482 27,474 28,978 21,319
Accrued interest receivable 37,861 37,534 34,159 33,729
Intangible assets, net 1,552 1,651 1,751 1,950
Other real estate owned 19,559 16,949 18,756 21,117
Deferred tax asset, net 21,764 21,219 20,379 18,290
Other assets 109,680 133,126 127,107 99,427
-------------------- -------------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- --------------------
$ 7,915,856 $ 7,705,695 $ 7,465,767 $ 7,606,959
Total assets
==================== ============== ==================== ==================== ========== ==================== ==================== ========== ==================== ==================== ========== ====================
Liabilities:
Deposits
$ 6,828,159 $ 6,630,251 $ 6,455,043 $ 6,607,767
Demand and interest checking
62,597 50,659 49,428 96,890
Savings and money market
-------------------- -------------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- --------------------
6,890,756 6,680,910 6,680,910 6,680,910 6,504,471 6,504,471 6,504,471 6,704,657 6,704,657 6,704,657
Total deposits
-------------------- -------------- -------------------- -------------------- -------------------- ---------- -------------------- -------------------- -------------------- ---------- -------------------- -------------------- -------------------- ---------- --------------------
Securities sold under agreements to repurchase -- 42 42 42
Senior debt 95,948 95,859 95,771 99,142
Subordinated debenture 13,401 13,401 13,401 13,401
Other long-term borrowings 38,407 38,561 9,861 9,972
Other liabilities 60,579 69,641 69,641 69,641 68,533 68,533 68,533 54,597 54,597 54,597
-------------------- -------------- -------------------- -------------------- -------------------- ---------- -------------------- -------------------- -------------------- ---------- -------------------- -------------------- -------------------- ---------- --------------------
$ 7,099,091 $ $ 6,898,414 $ $ 6,692,079 $ $ 6,881,811
Total liabilities
-------------------- -------------- -------------------- -------------------- -------------------- ---------- -------------------- -------------------- -------------------- ---------- -------------------- -------------------- -------------------- ---------- --------------------
Shareholders' equity:
Common stock - authorized, 75,000,000 shares of $1.00 par value; 52,253,037 and 55,329,629 shares issued and outstanding at March 31, 2024 and 2023, respectively 52,253 53,203 53,867 55,330
Additional paid-in capital 166,335 212,431 234,320 277,814
Retained earnings 618,044 561,615 517,587 418,441
Accumulated other comprehensive loss (19,867 ) (19,968 (19,968 (19,968 ) (32,086 (32,086 (32,086 ) (26,437 (26,437 (26,437 )
-------------------- -------------- -------------------- -------------------- -------------------- ---------- -------------------- -------------------- -------------------- ---------- -------------------- -------------------- -------------------- ---------- --------------------
Total shareholders' equity 816,765 807,281 773,688 725,148
-------------------- -------------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- -------------------- -------------------- ---------- --------------------
Average balance sheet and net interest income Three months ended March 31, 2024 Three months ended March 31, 2023
------------------------------------------------------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------------------------------
(Dollars in thousands; unaudited)
Average Average Average Average
Assets: Balance Interest Rate Balance Interest Rate
-------------------- ---------------------------------- -------------------- -------------------- -------------------- ---------------------------------- -------------------- ------------------------------ -------------------- -------------------- ----------------------------------
Interest earning assets:
$ 5,717,262 $ 114,160 7.99 % $ 5,987,179 $ 106,204 7.10 %
Loans, net of deferred fees and costs(1)
4,746 116 9.78 % 3,361 69 8.21 %
Leases-bank qualified(2)
733,599 9,634 5.25 % 774,055 9,300 4.81 %
Investment securities-taxable
2,895 50 6.91 % 3,343 41 4.91 %
Investment securities-nontaxable(2)
874,073 11,884 5.44 % 580,058 6,585 4.54 %
Interest earning deposits at Federal Reserve Bank
-------------------- -------------- -------------------- -------------------- -------------------- -------------------- ---------- -------------------- -------------------- --------------------
Net interest earning assets 7,332,575 135,844 7.41 % 7,347,996 122,199 6.65 %
Allowance for credit losses (27,158 ) (22,533 )
Other assets 331,756 237,721
-------------------- -------------- -------------------- -------------------- ---------- --------------------
$ 7,637,173 $ 7,563,184
==================== ============== ==================== ==================== ========== ====================
Liabilities and Shareholders' Equity:
Deposits:
$ 6,453,866 $ 38,714 2.40 % $ 6,406,834 $ 32,383 2.02 %
Demand and interest checking
50,970 447 3.51 % 132,279 1,219 3.69 %
Savings and money market
-- -- -- -- -- 84,333 858 4.07 4.07 %
Time deposits
-------------------- -------------- -------------------- -------------------- -------------------- -------------------- ---------- -------------------- -------------------- --------------------
Total deposits 6,504,836 39,161 2.41 % 6,623,446 34,460 2.08 %
Short-term borrowings 1,373 19 5.54 % 20,500 234 4.57 %
Repurchase agreements 13 -- -- 42 -- --
Long-term borrowings 38,517 686 7.12 % 9,998 126 5.04 %
Subordinated debentures 13,401 292 8.72 8.72 8.72 % 13,401 261 7.79 7.79 %
Senior debt 95,894 1,233 5.14 5.14 5.14 % 99,092 1,279 5.16 5.16 %
-------------------- -------------- -------------------- -------------------- -------------------- -------------------- ---------- -------------------- -------------------- --------------------
Total deposits and liabilities 6,654,034 41,391 2.49 % 6,766,479 36,360 2.15 %
Other liabilities 171,116 87,116
-------------------- -------------- -------------------- -------------------- ---------- --------------------
Total liabilities 6,825,150 6,853,595
Shareholders' equity 812,023 709,589
-------------------- -------------- -------------------- -------------------- ---------- --------------------
$ 7,637,173 $ 7,563,184
==================== ============== ==================== ==================== ========== ====================
$ 94,453 $ 85,839
Net interest income on tax equivalent basis(2)
==================== ==================== ==================== ====================
35 23
Tax equivalent adjustment
$ 94,418 $ 85,816
Net interest income
==================== ==================== ==================== ====================
(1)Includes commercial loans, at fair value. All periods include non-accrual loans.
Allowance for credit losses Three months ended Year ended
March 31, March 31, December 31,
2024 (unaudited) 2023 (unaudited) 2023 2023
------------------------------------------------------ ------------------------------------------------------ -------------------- --------------------------------------------------
(Dollars in thousands)
Balance in the allowance for credit losses at beginning of period $ 27,378 $ 22,374 $ $ 22,374
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------------- ---------- --------------------
Loans charged-off:
111 214 871
SBA non-real estate
-- -- 76
SBA commercial mortgage
919 905 3,666
Direct lease financing
-- -- 24
IBLOC
6 3 3
Consumer - other
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------------- ---------- --------------------
1,036 1,122 4,640
Total
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------------- ---------- --------------------
Recoveries:
4 202 475
SBA non-real estate
-- 75 75
SBA commercial mortgage
32 67 330
Direct lease financing
-- -- 299
Consumer - home equity
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------------- ---------- --------------------
36 344 1,179
Total
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------------- ---------- --------------------
Net charge-offs 1,000 778 3,461
Provision for credit losses, excluding commitment provision 2,363 2,198 8,465
-------------------- -------------- -------------------- -------------------- -------------- -------------------- -------------------- -------------------- ---------- --------------------
Balance in allowance for credit losses at end of period $ 28,741 $ 23,794 $ 27,378
==================== ============== ==================== ==================== ============== ==================== ========== ====================
Net charge-offs/average loans 0.02 % 0.01 % 0.07 %
Loan portfolio March 31, December 31, September 30, March 31,
2024 (unaudited) 2023 2023 (unaudited) 2023 (unaudited)
---------------------------------------- ---------------------------------------- ---------------------------------------- ----------------------------------------
(Dollars in thousands)
SBL non-real estate $ 140,956 $ 137,752 $ 130,579 $ 114,334
SBL commercial mortgage 637,926 606,986 547,107 492,798
SBL construction 27,290 22,627 22,627 22,627 19,204 19,204 19,204 33,116 33,116 33,116
-------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
Small business loans 806,172 767,365 696,890 640,248
Direct lease financing 702,512 685,657 670,208 652,541
SBLOC / IBLOC(1) 1,550,313 1,627,285 1,720,513 2,053,450
Advisor financing(2) 232,206 221,612 199,442 189,425
Real estate bridge loans 2,101,896 1,999,782 1,848,224 1,752,322
Other loans(3) 56,163 50,638 50,638 50,638 55,800 55,800 55,800 60,210 60,210 60,210
-------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
5,449,262 5,352,339 5,191,077 5,348,196
Unamortized loan fees and costs 10,082 8,800 8,800 8,800 7,895 7,895 7,895 6,151 6,151 6,151
-------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
Small business portfolio March 31, December 31, September 30, March 31,
2024 (unaudited) 2023 2023 (unaudited) 2023 (unaudited)
---------------------------------------- ---------------------------------------- ---------------------------------------- ----------------------------------------
(Dollars in thousands)
SBL, including unamortized fees and costs $ 816,151 $ $ 776,867 $ $ 705,790 $ 648,858
SBL, included in loans, at fair value 109,131 119,287 119,287 119,287 126,543 126,543 126,543 140,909
-------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
(1)SBLOC are collateralized by marketable securities, while IBLOC are collateralized by the cash surrender value of insurance policies. At March 31, 2024 and December 31, 2023, IBLOC loans amounted to $595.6 million and $646.9 million, respectively.
(2)In 2020 The Bancorp began originating loans to investment advisors for purposes of debt refinancing, acquisition of another firm or internal succession. Maximum loan amounts are subject to loan-to-value ("LTV") ratios of 70% of the business enterprise value based on a third-party valuation, but may be increased depending upon the debt service coverage ratio. Personal guarantees and blanket business liens are obtained as appropriate.
(3)Includes demand deposit overdrafts reclassified as loan balances totaling $239,000 and $1.7 million at March 31, 2024 and December 31, 2023, respectively. Estimated overdraft charge-offs and recoveries are reflected in the allowance for credit losses and are immaterial.
Small business loans as of March 31, 2024
Loan principal
(Dollars in millions)
U.S. government guaranteed portion of SBA loans(1) $ 395
PPP loans(1) 2
Commercial mortgage SBA(2) 311
Construction SBA(3) 14
Non-guaranteed portion of U.S. government guaranteed 7(a) Program loans(4) 114
Non-SBA SBLs 49
Other(5) 29