1st Mariner shares rebound 

Posted: 7:08 pm Tue, February 2, 2010
By Danielle Ulman
Daily Record Business Writer

Shares of First Mariner Bancorp’s stock traded above $1 for 10 consecutive business days as of Tuesday, likely eliminating the possibility of it being delisted.

In December, NASDAQ warned the company that its stock had fallen below the Global Market minimum requirements of a $5 million market cap and a share price of $1 for 30 consecutive days, and gave it deadlines to increase the stock’s trading value and market share or risk being delisted.

Tuesday marked 10 consecutive business days of the stock trading above $1 and market cap — number of shares multiplied by share price — remained above $5 million for 10 days in a row in late December. NASDAQ did not respond to requests for comment.

First Mariner’s shares closed at $1.21 Tuesday, down 4 cents or 3.2 percent, after the company reported a loss of $3.7 million in the fourth quarter.

While the losses continued to pile up at the parent of 1st Mariner Bank, Baltimore’s largest independently owned bank, the size of the loss decreased significantly compared to the fourth quarter of 2008, when the company lost $9.4 million.

“The results continue to be encouraging, but we still forecast continued quarterly losses going forward,” said Anthony Polini, an analyst with Raymond James & Associates Inc.

“This is the fourth quarter in a row where non-performing assets have stayed in a narrow range,” he said. “There is still good news, it’s just that obviously the company needs more capital if it’s ever going to get its earnings machine in gear.”

And First Mariner needs to raise capital if it wants to meet requirements set by the Federal Deposit Insurance Corp., which placed the company under scrutiny in September, ordering it to get rid of problem loans and bump up capital levels, a measurement of a bank’s stability.

The FDIC has said the bank must achieve and maintain a Tier 1 Leverage Capital ratio of 7.5 percent of the bank’s average total assets and a Total Risk-Based Capital ratio of at least 11 percent by June.

As of the fourth quarter, the bank’s Tier 1 ratio was 7.9 percent and its capital ratio was 9.1 percent, an improvement from September when the total capital ratio was 8.4 percent.

The Tier 1 Capital ratio is a bank’s core equity capital compared to its total assets; the Total Risk-Based Capital ratio is the requirement that banks keep a minimum ratio of estimated total capital to estimated risk-weighted assets.

“We are encouraged by the stabilization in our asset quality during the year and a decrease in our loan delinquencies during the final quarter of the year,” Edwin F. Hale Sr., First Mariner’s chairman and chief executive, said in an earnings release.

“We have been focused on resolving prior problem assets and improving the balance sheet of 1st Mariner,” he said. “The figures reported for the fourth quarter reflect that effort.”

First Mariner is holding a shareholder vote next week on whether it can sell additional shares of its stock.

Dennis Finnegan, executive vice president at First Mariner, said Securities and Exchange Commission rules meant he could not comment while the bank awaits the vote to issue up to $20 million in additional stock.

“It could be a very opportunistic time, especially since the economic outlook is getting better,” Polini said regarding the company’s efforts to raise capital. He noted that the share price has more than doubled since Dec. 3 when it closed at 59 cents.