Bay Bancorp, Inc. (NASDAQ:BYBK) Files An 8-K Other Events
Item 8.01. Other Events.

On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act (the “Act”). The Act amends the Internal Revenue Code to reduce tax rates and modify policies, credits, and deductions for individuals and businesses. For businesses, the Act reduces the corporate federal tax rate from a maximum of 35% to a flat 21% rate. The rate reduction took effect on January 1, 2018.

At September 30, 2017, Bay Bancorp, Inc. (the “Company”) had a net deferred tax asset totaling $2.5 million. Under generally accepted accounting principles, the Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company’s net deferred tax asset of $2.5 million was determined at September 30, 2017 based on the Company’s tiered then-current enacted federal tax rate of 34%. As a result of the reduction in the corporate income tax rate from 35% to 21% under the Act, the Company will revalue its net deferred tax asset at December 31, 2017. The Company estimates that this will result in a reduction in the value of its net deferred tax asset of approximately $1.0 million, which reduction will be recorded as additional income tax expense in the Company’s consolidated statement of income for the three months ended December 31, 2017. The Company’s revaluation of its deferred tax asset is subject to further clarification of the Act. As a result, the actual impact on the net deferred tax asset may vary from the estimated amount due to uncertainties in the Company’s preliminary review.

This report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “should,” and “will” and variations of such words and similar expressions are intended to identify such forward-looking statements. Forward-looking statements are based on current expectations, estimates and projections, are not guarantees of future performance and involve risks, assumptions and uncertainties. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. Accordingly, you are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date they are made. The Company expressly disclaims any current intention to update publicly any forward-looking statement after the filing of this report, whether as a result of new information, future events, changes in assumptions or otherwise.

About Bay Bancorp, Inc. (NASDAQ:BYBK)

Bay Bancorp, Inc., formerly Carrollton Bancorp, is a savings and loan holding company. The Company operates through its subsidiary, Bay Bank, FSB (the Bank). It operates in the Community Banking segment. The Bank serves local consumers, small and medium size businesses, professionals and other customers by offering a range of financial products and services, including online and mobile banking, commercial banking, cash management, mortgage lending and retail banking. Its funds a range of loan types, including commercial and residential real estate loans, commercial term loans, lines of credit, consumer loans and letters of credit. It offers its customers wire transfer services, automated clearinghouse (ACH) services, automated teller machine (ATM) and check cards. It also offers telephone banking services and Internet bill paying services. It also offers remote deposit capture to its commercial customers and mobile capture to its business and consumer customers.