What are Glen Burnie Bancorp's Business Segments?
Real Estate Lending. The Bank offers long-term mortgage financing for residential
and commercial real estate as well as shorter term construction and land development
loans. Residential mortgage and residential construction loans are originated
with fixed rates, while commercial mortgages may be originated on either a fixed
or variable rate basis. Commercial construction loans may be originated on either
a fixed or a variable rate basis. Substantially all of the Bank’s real estate
loans are secured by properties in Anne Arundel County, Maryland. Under the Bank’s
loan policies, the maximum permissible loan-to-value ratio for owner-occupied
residential mortgages is 80% of the lesser of the purchase price or appraised
value. For residential investment properties, the maximum loan-to-value ratio
is 80%. The maximum permissible loan-to-value ratio for residential and residential
construction loans is 80%. The maximum loan-to-value ratio for permanent commercial
mortgages is 75%. The maximum loan-to-value ratio for land development loans is
70% and for unimproved land is 65%. The Bank also offers home equity loans secured
by the borrower’s primary residence, provided that the aggregate indebtedness
on the property does not exceed 80% of its value. Because mortgage lending decisions
are based on conservative lending policies, the Company has no exposure to the
credit issues affecting the sub-prime residential mortgage market.
Commercial Lending. The Bank’s commercial loan portfolio consists of demand,
installment and time loans for commercial purposes. The Bank’s business
demand, installment and time lending includes various working capital loans, equipment,
vehicles, lines of credit and letters of credit for commercial customers. Demand
loans require the payment of interest until called, while installment loans require
a monthly payment of principal and interest, and time loans require at maturity
a single payment of principal and interest due monthly. Such loans may be made
on a secured or an unsecured basis. All such loans are underwritten on the basis
of the borrower’s creditworthiness rather than the value of the collateral.
Installment Lending. The Bank makes consumer and commercial installment loans
for the purchase of automobiles, boats, other consumer durable goods, capital
goods and equipment. Such loans provide for repayment in regular installments
and are secured by the goods financed. Also included in installment loans are
other types of credit repayable in installments.
Indirect Automobile Lending. The Bank commenced its indirect automobile lending
program in January 1998. The Bank finances new and used automobiles for terms
of up to 75 months. The Bank will lend a maximum of 110% of invoice on new vehicles.
On used vehicles, the Bank will not lend more than 120% of the clean wholesale
value as published in a nationally recognized used vehicle pricing guide. The
Bank requires all borrowers to obtain vendor’s single interest coverage
protecting the Bank against loss in the case a borrower’s automobile insurance
lapses. The Bank originates indirect loans through a network of approximately
60 dealers which are primarily new car dealers located in Anne Arundel County
and the surrounding counties. Participating dealers take loan applications from
their customers and transmit them to the Bank for approval.
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