Sandy Spring Bancorp, Eagle Bancorp Report Profit

Sandy Spring Bancorp of Olney said third-quarter profit fell 34 percent, to $5.4 million (33 cents) from $8.2 million (50 cents). Results include a pretax impairment charge of $2.3 millino related to a writedown in goodwill in Equipment Leasing Co., a subsidiary. Assets dropped 8 percent, to $3.2 billion.

Loans and leases grew 13 percent, to $2.5 billion, an increase the company attributed to more commercial loans. Sandy Spring's provision for loan and lease losses was $6.5 million, compared with $800,000 in the year-earlier period. The bank held $68.4 million in non-performing assets as of Sept. 30, compared with $25.8 million a year earlier. President Daniel J. Schrider said in a statement that the growth was due to volatile markets and "in particular, their effect on local residential real estate developer with whom we have long-standing relationships."

"Sandy Spring Bancorp is not totally immune from the impact of recent economic events, including the slump in housing," CEO Hunter R. Hollar said in a statement. "We are recognizing the problem loans whose repayment is dependent on home sales and we are working hard to manage through these loans in order to minimize the impact on Sandy Spring Bank and on the borrower."

Eagle Bancorp of Bethesda said its third-quarter profit grew, rising to $2.3 million (21 cents) from $1.8 million (18 cents). Assets also grew, climbing 81.7 percent, to $1.46 billion.

Much of Eagle's balance-sheet growth was due to its purchase of Fidelity & Trust in August, the company said.

The provision for credit losses grew to $995,000 from $421,000. Nonperforming assets grew to $21.1 million as of Sept. 30, up from $5.6 million the previous year, due mainly to loans from Fidelity and two commercial real estate loan relationships, Eagle Bancorp said.

Both banks say they remain well-capitalized.

By Terri Rupar  |  October 23, 2008; 11:27 AM ET  | Category:  Earnings , Economy Watch
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