 BETHESDA, Md., July 22, 2020 GLOBE NEWSWIRE -- Eagle Bancorp, Inc. the Company NASDAQ: EGBN, the parent company of EagleBank the Bank, today announced quarterly net income of 28.9 million for the three months ended June 30, 2020, a 23 decrease, as compared to 37.2 million net income for the three months ended June 30, 2019. Net income per basic and diluted common share for the three months ended June 30, 2020 was 0.90 compared to 1.08 for the same period in 2019. For the six months ended June 30, 2020, the Companys net income was 52.0 million, a 27 decrease from the 71.0 million of net income for the same period in 2019. Net income per basic common share for the six months ended June 30, 2020 was 1.60 compared to 2.06 for the same period in 2019. Net income per diluted common share for the six months ended June 30, 2020 was 1.60 compared to 2.05 for the same period in 2019. Summary Financial Analysis While the country at large experienced a very challenging environment in the second quarter of 2020 due to the COVID-19 pandemics extensive negative impacts to businesses and the economy in general, the banking industry faced significant related credit and interest rate challenges. In spite of these second quarter headwinds, we believe our Company has managed well, both in terms of our employee base staying healthy as well as staying in close contact with our many business relationships. As a result, we are pleased to report another quarter of overall favorable earnings, highlighted by continued growth in average loans and deposits, favorable operating leverage, and improved noninterest income, noted Susan G. Riel, President and Chief Executive Officer of Eagle Bancorp, Inc. Ms. Riel continued, The Companys assets ended the quarter at 9.8 billion, representing 13 growth over the second quarter of 2019. Second quarter 2020 earnings resulted in a return on average assets ROAA of 1.12, return on average common equity ROACE of 9.84, and a return on average tangible common equity ROATCE of 10.80. A reconciliation of GAAP to non-GAAP financial measures is provided in the tables that accompany this document.The Companys performance in the second quarter of 2020 as compared to the second quarter of 2019 was highlighted by growth in average total loans of 10, growth in average total deposits of 23, 7 growth in total revenue to 93.9 million, and a 5 increase in noninterest expenses, further improving our operating leverage and resulting in an improved efficiency ratio of 37.18 for the second quarter of 2020 versus 38.04 for the second quarter of 2019. The improved efficiency was due to strong noninterest income performance in the quarter. Additionally, the ratio of non-performing loans to total loans, while elevated in the second quarter 2020 over the first quarter, remained at reasonably normal levels at 0.74 given the credit concerns arising from the impact of COVID-19 related shutdowns. The evolution of the COVID-19 pandemic and related containment and relief measures will determine how the impacts will be reflected in our loan portfolio, including these measures, over time. Annualized net charge-offs to average loans for the second quarter 2020 was also elevated at 0.36 compared to 0.12 for the first quarter of 2020, primarily resulting from one large commercial loan relationship in the personal services industry. Ms. Riel noted, The Company continues to focus on changes in average loan and deposit balances quarter over quarter and year over year since those measures more directly impact income statement results. Comparing those balances in the second quarter of 2020 versus the first quarter of 2020, average loan growth was 4.8 and average deposits increased by 10.2. Ms. Riel added, Approximately 90 of the average loan growth in the second quarter of 2020 over first quarter of 2020 was due to the Paycheck Protection Program PPP loans, as authorized by the Coronavirus Aid Relief and Economic Security Act the CARES Act passed by Congress in March 2020. At June 30, 2020, the Bank had loans outstanding of 456 million to just over 1,400 businesses under the PPP program. In the second quarter 2020, as average U.S. Treasury rates in the two to five year area declined significantly by about 80-90 basis points and the average yield curve remained fairly flat, we experienced 23 basis points of net interest margin compression from 3.49 to 3.26 as compared to the first quarter of 2020. In addition, our cost of funds declined 41 basis points from 1.06 to 0.65, while the yield on earning assets declined by 64 basis points from 4.55 to 3.91. Substantially higher average liquidity in the second quarter compared to the first quarter of 2020 contributed to the net interest margin compression as average deposit growth outweighed average loan growth. Average liquidity for the second quarter was 1.1 billion versus 605 million for the first quarter of 2020. The yield on our substantial level of variable rate loans was negatively impacted by the much lower interest rate environment in the second quarter of 2020, including a 105 basis point decline in the average one-month LIBOR rate. A substantial portion of the variable rate loans portfolio has interest rate floors which cushioned the decline in loan yields.Ms. Riel added, In the second quarter of 2020, period end total loan growth was 2.3 from March 31, 2020, while total deposits declined 2.5 from March 31, 2020. Excluding PPP loan balances at June 30, 2020 total loans decreased 276 million, or 3.5, during the quarter. A portion of this decrease at June 30, 2020 relative to March 31, 2020 was the result of repayments on line of credit advances taken in an abundance of caution given the uncertainty surrounding the COVID-19 pandemic in the first quarter. While average deposits showed good growth throughout the second quarter, deposit balances declined sharply near quarter end, driven in part by clients attempting to capture favorable stock market performance in the latter half of June. New loans closed in the second quarter of 2020 were below average levels due substantially to the COVID-19 environment, while loan payoffs were close to average levels. Average unfunded loan commitments have remained stable over the last six quarters at approximately 2.2 billion. The Company continues to emphasize achieving core deposit growth and we continue to seek well-structured new loan opportunities. The mix of noninterest deposits to total deposits remained favorable and averaged 30 in the second quarter of 2020, consistent with the average in the second quarter of 2019. The net interest margin was 3.26 for the second quarter of 2020, down 65 basis points from the second quarter of 2019. Ms. Riel noted, In addition to the current sharply lower interest rate environment as compared to 2019, there has been a lesser focus on higher risk and higher yielding construction lending and more attention towards strong commercial real estate credits secured by stabilized income producing properties. The yield on our loan portfolio was 4.63 for the second quarter of 2020 as compared to 5.61 for the second quarter of 2019 and 5.07 for the first quarter of 2020. The addition of the PPP loans at an average yield of 2.91 for the quarter negatively impacted the overall yield of the total loan portfolio by approximately seven basis points. The cost of funds was 0.65 for the second quarter of 2020 as compared to 1.30 for the second quarter of 2019 and 1.06 for the first quarter of 2020. Importantly, even considering the decline in the net interest margin, the Companys net interest income was stable in the second quarter of 2020 over 2019 as the Company has continued its pattern of average balance sheet growth while maintaining emphasis on disciplined pricing for both new loans and funding sources in the face of competitive pressures.For the first six months of 2020 as compared to the first six months in 2019, average total loans increased 10 and average total deposits increased by 17. Total revenue net interest income plus noninterest income for the second quarter of 2020 was 93.9 million, or 7 above the 87.7 million of total revenue earned for the second quarter of 2019 and was 10 higher than the 85.2 million of revenue earned in the first quarter of 2020. For the six month periods ended June 30, 2020, total revenue was 179.1 million for 2020 as compared to 175.0 million in 2019, a 2 increase. The primary driver of the Companys revenue growth for the second quarter of 2020 as compared to the second quarter of 2019 was its noninterest income growth of 96 12.5 million versus 6.4 million, due substantially to revenue from our Federal Housing Administration FHA Multifamily business unit and increased originations and sales of residential mortgage loans and the resulting gains on the sale of these loans. While we are encouraged by the pipeline and current quarter contribution of the FHA Multifamily business, revenue from this business can be uneven quarter to quarter.Asset quality measures remained solid at June 30, 2020. Net charge-offs annualized were 0.36 of average loans for the second quarter of 2020 attributable mostly to a single credit, as compared to 0.08 of average loans for the second quarter of 2019. At June 30, 2020, the Companys nonperforming loans amounted to 59.0 million 0.74 of total loans as compared to 37.4 million 0.51 of total loans at June 30, 2019, and 48.7 million 0.65 of total loans at December 31, 2019. Nonperforming assets amounted to 67.2 million 0.69 of total assets at June 30, 2020 compared to 38.8 million 0.45 of total assets at June 30, 2019 and 50.2 million 0.56 of total assets at December 31, 2019. 