A surge in mortgage lending combined with improved asset quality and expense control led the embattled First Mariner Bancorp in Baltimore to its first profitable quarter in more than five years for the quarter that ended March 31.
First Mariner said Wednesday that it earned $1.8 million in the quarter, compared to a loss of $7.3 million in the same period last year, as mortgage activity significantly boosted fee income and reduced funding costs led to an increase in interest income. The company, which has been hammered by losses on real estate loans, also attributed its turnaround in part to a 12% decline in nonperforming assets year over year.
To be sure, First Mariner is not out of the woods; the $1.2 billion-asset company remains undercapitalized and saddled with scores of problem loans. The company warned investors in a Securities and Exchange Commission filing last month that
Still, its interim chief executive, Mark A. Keidel, struck an upbeat tone in the earnings release, noting that improvements in the economy have spurred more loan activity and helped more customers keep current on loan payments. Illustrating that optimism, First Mariner last month
"As we move into the second quarter, we remain focused on improving all aspects of our operations and continue to execute on current opportunities in mortgage banking," Keidel said in a news release. "We remain committed to improving our capital levels and are working diligently to satisfy the requirements in our regulatory agreements."
First Mariner's shares, which now trade over the counter, were up nearly 20% in heavy trading Wednesday, to 49 cents.
