The Bancorp in Wilmington, Del., reported a quarterly loss as it racked up higher expenses to resolving anti-money laundering issues.
The $5 billion-asset company lost $2.2 million in the fourth quarter, after earning $7.3 million a year earlier. The loss of 1 cent a share topped the average estimate of analysts polled by Bloomberg by 10 cents.
The results come as the company deals with a host of regulatory troubles. The Bancorp in June was hit with a consent order from the Federal Deposit Insurance Corp., which found weaknesses in the company's Bank Secrecy Act compliance programs. Earlier this year, the FDIC also assessed an insurance premium surcharge because of a new way the agency is treating certain prepaid accounts.
Expenses tied with regulatory issues drove the fourth-quarter loss. Noninterest expenses surged 35%, to $36.6 million, mostly because of consulting expenses associated with complying with the Bank Secrecy Act.
Fee-based income fell 19%, to $17.6 million. The company took a loss on the sale of loans, citing unexpected market volatility.
Net interest income jumped 34%, to $15.8 million. Total loans grew 2%, to $875.9 million, and the net interest margin expanded by 8 basis points, to 2.62%.
The Bancorp announced last quarter that it had discontinued its commercial lending business, instead shifted its focus to specialty finance, including fleet leasing and security-backed lines of credit.