RESTON, Va.--(BUSINESS WIRE)--
John Marshall Bank (OTCQB: JMSB) (the “Bank”) reported that it will
incur an impairment related to a $4.2 million lending relationship due
to the unexpected termination of the borrower’s business in March. The
lending relationship with the company is made up of three loans. Two of
the loans, totaling $1.6 million, are well secured by real estate which
is in the process of liquidation. No impairment is expected with respect
to these two real estate secured loans. The remaining commercial loan,
with a balance of $2.6 million, is secured by receivables, inventory,
equipment and intangible assets. Based on a preliminary assessment of
the collateral value on this loan, the range of impairment is estimated
to be between $1.9 million and $2.6 million. While no specific estimate
of impairment can be made as of this date, the Bank’s current estimate
of impairment is $2.5 million, which will be recognized as a provision
to its allowance for loan and lease losses during the first quarter of
2016. As additional information becomes available, and prior to
releasing financial results for the quarter ending March 31, 2016, an
adjustment to the estimated impairment will be made as indicated by the
Bank’s ongoing efforts to liquidate collateral.
“We are disappointed by the impact this will have on our first quarter
earnings, but are confident that this is an isolated incident that is
not reflective of the Bank's overall strong credit quality, internal
controls and sound loan underwriting practices,” said John Maxwell,
Chairman and CEO of the Bank. “This involves a long standing commercial
relationship with a company that we have banked for many years, with a
history of profitability and satisfactory servicing and repayment of all
prior loans. We continue to investigate the matter thoroughly and are
taking appropriate steps to protect the Bank’s assets and maximize the
amount of our recovery.”
John Marshall Bank is headquartered in Reston, Virginia and has five
full-service branches located in Reston, Leesburg, Arlington, Alexandria
and Rockville. The Bank also has a limited-service commercial branch
located in Washington, DC. Further information on the Bank can be
obtained by visiting its website at www.johnmarshallbank.com.
This press release contains forward-looking statements within the
meaning of the Securities and Exchange Act of 1934, as amended,
including statements of goals, intentions, and expectations as to future
trends, plans, events or results of Bank operations and policies and
regarding general economic conditions. In some cases, forward-looking
statements can be identified by use of words such as “may,” “will,”
“anticipates,” “believes,” “expects,” “plans,” “estimates,” “potential,”
“continue,” “should,” and similar words or phrases. These statements are
based upon current and anticipated economic conditions, nationally and
in the Bank’s market, interest rates and interest rate policy,
competitive factors, and other conditions which by their nature, are not
susceptible to accurate forecast, and are subject to significant
uncertainty. Because of these uncertainties and the assumptions on which
this discussion and the forward-looking statements are based, actual
future operations and results may differ materially from those indicated
herein. Readers are cautioned against placing undue reliance on any such
forward-looking statements. The Bank’s past results are not necessarily
indicative of future performance.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160331006155/en/
John Marshall Bank
John R. Maxwell, 703-584-0840
Source: John Marshall Bank