Profile: Eagle Bancorp Inc (EGBN.OQ)
18 Sep 2014
Eagle Bancorp, Inc., incorporated on October 28, 1997, is a bank holding company for EagleBank (the Bank). The Bank is a chartered commercial bank. The Bank is the Company's principal operating subsidiary. As of December 31, 2011, the Bank operated 15 offices: seven in Montgomery County, Maryland located in Rockville (three), Bethesda, Silver Spring, Potomac and Chevy Chase, five located in the District of Columbia, and three in Northern Virginia located in Tysons Corner, Ballston and Rosslyn. The Bank offers full commercial banking services to its business and professional clients as well as complete consumer banking services to individuals living and/or working in the service area. The Bank also provides commercial banking services to sole proprietorships, small and medium-sized businesses, partnerships, corporations, non-profit organizations and associations, and investors living and working in and near the Bank's primary service area.
A range of retail banking services are offered to accommodate the individual needs of both corporate customers, as well as the community the Bank serves. The Bank also offers a remote deposit service, which allows clients to facilitate and expedite deposit transactions through the use of electronic scanning devices. The Bank operates as a community bank alternative to the regional financial institutions, which dominate EagleBank's primary market area. The primary service area of the Bank is the Washington District of Columbia metropolitan area. Other services include cash management services, business sweep accounts, lock box, and account reconciliation services, merchant card services, safety deposit boxes and automated clearing house origination. After-hours depositories and automated teller machine (ATM) service are also provided. In February 2012, the Bank opened its sixteenth branch office in Reston, Virginia in the One Reston Overlook building at 12011 Sunset Hills Road-outside the Reston Town Center.
Eagle Commercial Ventures, LLC (ECV) a direct subsidiary, provides subordinated financing for the acquisition, development and construction of real estate projects. Bethesda Leasing, LLC, holds title to and operates real estate owned acquired through foreclosure. Eagle Insurance Services, LLC, provides commercial and retail insurance products through a referral arrangement with The Meltzer Group, an insurance brokerage within the Company's market area. The primary financial services offered by the Bank include real estate, commercial and consumer lending, as well as traditional deposit and repurchase agreement products. The Bank is also active in the origination and sale of residential mortgage loans and the origination of small business loans. The portion of small business loans is sold through the United States Small Business Administration, in a transaction apart from the loan's origination. As of December 31, 2011, the Bank offers its products and services through 15 banking offices and various electronic capabilities, including remote deposit services. In addition, the Bank offers personal lines of credit.
The Bank’s loan portfolio includes traditional business and real estate secured loans. Consumer loans include home equity lines of credit and structured with an interest only draw period followed either by a balloon maturity or a fully amortized repayment schedule. In general, the Bank offers credit services, such as commercial loans for business purposes including working capital, equipment purchases, real estate, lines of credit, and government contract financing; asset based lending and accounts receivable financing are available on a selective basis; real estate loans, including construction loan financing, for business and investment purposes; business equipment financing; consumer home equity lines of credit and term loans; traditional general purpose consumer installment loans including automobile and personal loans; credit card services are offered through an outside vendor, and residential mortgage loans. As of December 31, 2011, commercial real estate, and real estate construction combined represented approximately 70% of the loan portfolio. As of December 31, 2011, owner occupied commercial real estate and owner occupied commercial real estate construction represented 13.5% of the loan portfolio.
The Bank is an active traditional commercial lender providing loans for a variety of purposes, including cash flow, equipment and account receivable financing. This loan category represented approximately 23% of the loan portfolio as of December 31, 2011. Approximately 5% of the loan portfolio as of December 31, 2011, consisted of home equity loans and lines of credit and other consumer loans. The remaining 2% of the loan portfolio consists of residential home mortgage loans. The Company engages in sales of residential mortgage loans and the guaranteed portion of small business administration loans originated by the Bank. Loans held for sale are carried at the lower of aggregate cost or fair value.
The Company sells residential mortgage loans on a servicing released basis, and, therefore, it had no intangible asset recorded for the value of such servicing as of December 31, 2011. The Company enters into commitments to originate residential mortgage loans whereby the interest rate on the loan is determined prior to funding (i.e. rate lock commitments). The period of time between issuance of a loan commitment and closing and sale of the loan generally ranges from 15 to 60 days. The Company's loan portfolio includes loans made for real estate acquisition, development and construction (ADC) purposes, including both investment and owner occupied projects. ADC loans amounted to $429.7 million as of December 31, 2011. As of December 31, 2011, the Company’s loans totaled $ 2056.256 million.
The Bank maintains portfolios of short term investments and investment securities consisting primarily of the United States Government Agency bonds and government sponsored enterprise mortgage backed securities, and municipal bonds. The Company also owns equity investments related to membership in the Federal Reserve System and the Federal Home Loan Bank (FHLB). The Company's securities portfolio also consists of equity investments in the form of common stocks. The Company holds limited equity investments in local banking companies. As of December 31, 2011, the investment portfolio amounted to $313.8 million.
Sources of Funds
The principal sources of funds for the Bank are core deposits, consisting of demand deposits, negotiable order of withdrawal (NOW) accounts, money market accounts, savings accounts and certificates of deposits from the local market areas surrounding the Bank's offices. The deposit base includes transaction accounts, time and savings accounts and accounts which customers use for cash management, and which provide the Bank with a source of fee income and cross-marketing opportunities, as well as an attractive source of lower cost funds. As of December 31, 2011, total time deposits and savings and money market accounts included $311.2 million of brokered deposits, which represented 13% of total deposits.
A complete individual retirement account program is also provided. In cooperation with Goldman Sachs Asset Management, the Bank offers a Goldman Sachs Investment Sweep Account, a check writing cash management account that sweeps funds to one of several off-balance sheet investment accounts managed by Goldman Sachs. The Bank utilizes alternative funding sources, such as secured borrowings from the FHLB, federal funds purchased lines of credit from correspondent banks and brokered deposits from a regional brokerage firm, a national brokered funds network and from the Promontory Interfinancial Network, LLC network.
Eagle Bancorp Inc
7815 WOODMONT AVENUE
BETHESDA MD 20814