SOURCE: Oak Valley Bancorp

Oak Valley Bancorp

April 24, 2009 20:31 ET

Oak Valley Bancorp Reports 1st Quarter Results

OAKDALE, CA--(Marketwire - April 24, 2009) - Oak Valley Bancorp (NASDAQ: OVLY), the bank holding company for Oak Valley Community Bank and Eastern Sierra Community Bank, recently reported financial results. For the three months ended March 31, 2009, net income was $430,000. For the same period, net income available to common shareholders was $220,000, or $0.03 per diluted common share compared to $776,000, or $0.10 per diluted common share, for the same period last year.

An increase in net interest income was offset by a larger loan loss provision. Net interest income grew by 17.6% or $847,000, compared to the same period last year, but loan loss provisions for the first quarter 2009 were $1.9 million compared to the $145,000 provided in the same period in 2008. The Bank increased reserves corresponding to an increase of non-performing loans and recognition of a decline in property value of some assets securing non-performing loans. As of March 31, 2009, the allowance for loan loss to gross loans was 1.53%, up from 1.30% last quarter, and 1.09% for the three months ended March 31, 2008.

Total assets grew to $523.7 million at March 31, 2009, an increase of $60.7 million, or 13.1%, over March 31, 2008. Gross loans increased by $42.8 million, to $430.4 million as of March 31, 2009, an increase of 11.0% over March 31, 2008. The Bank's total deposits were $410.1 million on March 31, 2009, which is an increase of $47.3 million, or 13.0% over March 31, 2008.

"We experienced rather strong loan and deposit growth during the quarter and we are pleased with the operating income generated by the company given the state of the economy," stated Ron Martin, CEO. "Though we do not have the loan loss exposure of many of our peers, we are taking the necessary steps to ensure that we are adequately augmenting our reserves," he concluded.

First quarter non-performing assets to total assets are 2.66%, or $13.9 million, up from 1.47%, or $7.5 million, at year end 2008. As of March 31, 2009, seven loan relationships were on non-accrual status totaling $10.6 million, or 2.03% of total assets. Other Real Estate Owned (OREO) held as of March 31, 2009 was $3.3 million, or 0.63% of total assets and consists of three properties. All OREO property has been written down to current appraised values less sales cost and non-accrual loans have been reviewed to ensure adequate reserves have been established in light of current market values.

As of March 31, 2009, the Bank's common equity has grown to $45.3 million and the bank remains well capitalized by regulatory standards. However, taking into consideration the increased reserves and corresponding impact on net income, the Bank's Board of Directors elected to suspend dividends for the first quarter of 2009.

"While loan provisions continue to affect the Bank's earnings, we remain below our peer group in non-performing loan and OREO totals. At the same time, core operating results are strong and growth in loans and deposits continue. Although many factors are contributing to this including stock market volatility, recent bank consolidations, and the general public's increased desire to save during an economic downturn; we recognize that the ongoing calling efforts of our relationship managers is the primary reason for our growth. Our staff understands the importance of getting to know our customers and anticipating their needs," commented Chris Courtney, President.

Oak Valley Bancorp operates Oak Valley and Eastern Sierra Community Bank, through which it offers a variety of loan and deposit products to individuals and small businesses. The Company currently operates through 12 conveniently located branches: Oakdale, Sonora, Turlock, Stockton, Patterson, Ripon, Escalon, two branches in Modesto, and three branches in their Eastern Sierra Division, which includes Bridgeport, Mammoth Lakes and Bishop.

For more information call 1-866-844-7500 or visit us online at www.ovcb.com.

This press release includes forward-looking statements about the corporation for which the corporation claims the protection of safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on management's knowledge and belief as of today and include information concerning the corporation's possible or assumed future financial condition, and its results of operations and business. Forward-looking statements are subject to risks and uncertainties. A number of important factors could cause actual results to differ materially from those in the forward-looking statements. Those factors include fluctuations in interest rates, government policies and regulations (including monetary and fiscal policies), legislation, economic conditions, including increased energy costs in California, credit quality of borrowers, operational factors and competition in the geographic and business areas in which the company conducts its operations. All forward-looking statements included in this press release are based on information available at the time of the release, and the Company assumes no obligation to update any forward-looking statement.


                        Oak Valley Community Bank
                   Statement of Condition (unaudited)


Profitability           1st        4th        3rd        2nd        1st
($ in thousands,      Quarter    Quarter    Quarter    Quarter    Quarter
 except per share)     2009       2008       2008       2008       2008
Selected Quarterly
 Operating Data:
  Net interest
   income            $   5,656  $   5,333  $   5,292  $   5,081  $   4,809
  Provision for
   loan losses           1,900      1,001        602        440        145
  Non-interest
   income                  598        602        634        672        614
  Non-interest
   expense               3,938      4,712      4,535      4,562      4,057
  Income before
   income taxes            416        222        789        751      1,221
  Provision for
   income taxes            (14)       (61)       240        198        445
  Net income               430        283        549        553        776
  Preferred stock
   dividends and
   accretion              (210)       (64)         -          -          -
  Net income
   available to
   common
   shareholders            220        219        549        553        776

  Earnings per
   common share
   - basic                0.03       0.03       0.07       0.07       0.10
  Earnings per
   common share
   - diluted              0.03       0.03       0.07       0.07       0.10
  Dividends declared
   per common
   share (1)             0.025      0.025      0.050          -          -
  Return on average
   common equity          1.97%      1.95%      4.91%      5.01%      7.16%
  Return on average
   assets                 0.34%      0.23%      0.45%      0.47%      0.68%
  Net interest
   margin (2)             4.87%      4.72%      4.76%      4.77%      4.60%
  Efficiency
   Ratio (2)             61.80%     78.30%     76.03%     78.04%     73.70%

Capital - Period End
  Book value per
   share             $    5.91  $    5.81  $    5.77  $    5.71  $    5.69

Credit Quality -
 Period End
  Nonperforming
   assets/assets          2.66%      1.47%      1.33%      1.35%      1.60%
  Loan loss
   reserve/loans (3)      1.53%      1.30%      1.12%      1.08%      1.09%

Period End Balance
 Sheet
($ in thousands)
Total assets         $ 523,747  $ 508,203  $ 490,111  $ 476,094  $ 463,044
  Gross Loans          430,416    428,177    416,664    400,537    387,647
  Nonperforming
   assets               13,906      7,467      6,538      6,435      7,395
  Allowance for
   credit losses (3)     6,603      5,569      4,650      4,321      4,225
  Deposits             410,089    378,248    365,230    358,159    362,760
  Common Equity         45,286     44,486     44,151     43,735     43,302
Non-Financial Data
  Full-time
   equivalent staff        117        117        119        128        130
  Number of banking
   offices, domestic
   and foreign              12         12         12         12         12
Common Shares
 outstanding
  Period end         7,661,627  7,661,627  7,658,252  7,658,252  7,611,377
  Period average
   - basic           7,661,627  7,660,526  7,658,252  7,641,534  7,610,039
  Period average
   - diluted         7,703,892  7,723,711  7,743,091  7,697,681  7,696,308
Market Ratios
  Stock Price        $    3.75  $    6.00  $    6.30  $    7.00  $    8.49
  Price/Earnings         32.22      52.82      22.14      24.12      20.69
  Price/Book              0.63       1.03       1.09       1.23       1.49


(1) Cash dividends of $191,542, $382,943 and $191,542 paid in the Q1 2009,
    Q4 2008 and Q3 2008, respectively.
(2) Ratio computed on a fully tax equivalent basis using a marginal
    federal tax rate of 34%.
(3) Adjusted for Allowance for Off-Balance Sheet Credit Exposure.

Contact Information

  • Contact:
    Ron Martin/Chris Courtney/Rick McCarty
    Phone: (209) 848-2265
    www.ovcb.com