SOURCE: Oak Valley Bancorp

Oak Valley Bancorp

January 22, 2013 14:17 ET

Oak Valley Bancorp Reports 4th Quarter Results

OAKDALE, CA--(Marketwire - Jan 22, 2013) -  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 fiscal year ended December 31, 2012. Net income for 2012 totaled $5.8 million compared to $5.9 million for 2011. After adjustment for preferred stock dividends and accretion, net income available to common shareholders was $5.3 million, or $0.69 per diluted share, compared to net income of $4.7 million, or $0.61 per diluted common share, in 2011. This represents a 13.4% increase in net income available to common shareholders and marks record earnings for Oak Valley Bancorp. 

For the three months ended December 31, 2012, Oak Valley Bancorp reported net income of $1.49 million. After adjustment for preferred stock dividends and accretion, net income available to common shareholders was $1.41 million, or $0.18 per diluted share, representing a 5.7% increase in net income available to common shareholders when compared to the three months ended December 31, 2011.

Total assets grew to $660.5 million as of December 31, 2012, which was an increase of $48.3 million, or 7.9% over the prior year. Deposits increased to $587.0 million, which was an increase of $50.8 million, or 9.5% over the prior year. Gross loans at year end totaled $391.0 million, reflecting a decrease of $5.2 million, or 1.3%, from December 31, 2011. 

Non-performing assets totaled $6.9 million, or 1.05% of total assets at December 31, 2012, compared to $7.5 million, or 1.22% of total assets, at December 31, 2011. Charge-offs corresponding to updated valuations account for the decline in non-performing assets. 

The allowance for loan losses totaled 2.04% of gross loans at December 31, 2012 compared to 2.17% at December 31, 2011. The decrease in reserve ratio corresponds with the charge-offs on non-performing assets. The annual provision for loan losses of $1.2 million in 2012 was down from $1.5 million in 2011.

"The fundamentals of the Company remain strong, including the credit quality of the portfolio and continued deposit growth," commented Chris Courtney, President. "We are cautiously optimistic about loan growth opportunities in the coming year, as we begin to see signs of increased interest in commercial borrowing."

Net interest income of $24.8 million for the year ended December 31, 2012, decreased by $335,000, or 1.3%, from the prior year. This decrease comes from new loans boarding and maturing loans repricing in a low interest rate environment, causing downward pressure on yields. The Company's net interest margin was 4.52% for the year ended December 31, 2012, compared to 4.83% for the year ended December 31, 2011. Interest margin has also been affected by excess deposits being deployed into lower yielding securities and cash based investments. 

Non-interest income was $3.1 million for the year ended December 31, 2012, compared to $2.8 million the prior year. The increase primarily relates to growth in deposit related service charges and fee income generated from increased residential mortgage lending. 

Non-interest expense was $18.2 million for the year ended December 31, 2012, compared to $17.4 million for the prior year, an increase of $855,000, or 4.9%. This increase consists of costs associated with operating two additional branches for a full year, as well as costs related to servicing deposit growth across all branches. 

"We are pleased to report another record year for earnings," stated Ron Martin, CEO. "Our ability to perform with the best of our peers is a tribute to the relationship banking model and the character and capacity of our customers."

The Company currently operates through 14 branches in Oakdale, Sonora, Turlock, Stockton, Patterson, Ripon, Escalon, Manteca, three branches in Modesto, and three branches in their Eastern Sierra Division, which includes Bridgeport, Mammoth Lakes, and Bishop.

For more information, please call 1-866-844-7500 or visit 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 Bancorp  
Financial Highlights (unaudited)  
                             
($ in thousands, except per share) 4th Quarter     3rd Quarter     2nd Quarter     1st Quarter     4th Quarter  
Selected Quarterly Operating Data: 2012     2012     2012     2012     2011  
                                       
  Net interest income $ 6,115     $ 6,254     $ 6,212     $ 6,264     $ 6,335  
  Provision for loan losses   250       300       300       300       300  
  Non-interest income   855       790       672       831       636  
  Non-interest expense   4,513       4,527       4,612       4,597       4,259  
  Income before income taxes   2,207       2,217       1,972       2,198       2,412  
  Provision for income taxes   718       738       620       737       915  
  Net income   1,489       1,479       1,352       1,461       1,497  
  Preferred stock dividends and accretion   (84 )     (84 )     (114 )     (169 )     (168 )
  Net income available to common shareholders $ 1,405     $ 1,395     $ 1,238     $ 1,292     $ 1,329  
                                         
  Earnings per common share - basic   0.18       0.18       0.16       0.17       0.17  
  Earnings per common share - diluted   0.18       0.18       0.16       0.17       0.17  
  Dividends declared per common share   -       -       -       -       -  
  Return on average common equity   8.87 %     9.02 %     8.36 %     8.93 %     9.34 %
  Return on average assets   0.91 %     0.97 %     0.92 %     0.98 %     1.00 %
  Net interest margin (1)   4.15 %     4.57 %     4.73 %     4.67 %     4.70 %
  Efficiency ratio (1)   63.23 %     63.11 %     65.28 %     63.74 %     60.06 %
                                       
Capital - Period End                                      
  Book value per share $ 7.99     $ 7.85     $ 7.63     $ 7.37     $ 7.37  
                                       
Credit Quality - Period End                                      
  Nonperforming assets/ total assets   1.05 %     1.05 %     1.20 %     1.12 %     1.22 %
  Loan loss reserve/ gross loans   2.04 %     2.05 %     2.05 %     1.98 %     2.17 %
                                       
Period End Balance Sheet                                      
($ in thousands)                                      
  Total assets $ 660,480     $ 627,817     $ 596,417     $ 593,513     $ 612,172  
  Gross loans   390,986       388,714       390,515       392,584       396,202  
  Nonperforming assets   6,923       6,611       7,185       6,656       7,477  
  Allowance for loan losses   7,975       7,953       8,008       7,792       8,609  
  Deposits   586,993       553,333       526,407       518,727       536,204  
  Common equity   63,219       62,075       60,185       58,092       56,902  
  Total capital (2)   69,969       68,825       66,935       71,592       70,402  
                                       
Non-Financial Data                                      
  Full-time equivalent staff   130       123       125       126       128  
  Number of banking offices   14       14       14       14       14  
                                       
Common Shares outstanding                                      
  Period end   7,907,780       7,909,280       7,890,905       7,883,780       7,718,469  
  Period average - basic   7,762,261       7,750,727       7,728,024       7,722,609       7,705,164  
  Period average - diluted   7,793,523       7,778,146       7,750,952       7,743,941       7,737,248  
                                       
Market Ratios                                      
  Stock Price $ 7.45     $ 7.49     $ 6.96     $ 7.39     $ 6.75  
  Price/Earnings   10.38       10.49       10.84       11.01       9.87  
  Price/Book   0.93       0.95       0.91       1.00       0.92  
                                       
(1) Ratio computed on a fully tax equivalent basis using a marginal federal tax rate of 34%.  
(2) Includes $6.75 million in preferred stock issued to the U.S. Treasury under the SBLF Program.  
Prior to 6/30/2012, the amount of preferred stock issued was $13.5 million.  
                                       
                                       
    Year Ended
December 31,
 
    2012     2011  
                 
  Net interest income   $ 24,845     $ 25,180  
  Provision for loan losses     1,150       1,500  
  Non-interest income     3,148       2,751  
  Non-interest expense     18,249       17,394  
  Income before income taxes     8,594       9,037  
  Provision for income taxes     2,813       3,176  
  Net income     5,781       5,861  
  Preferred stock dividends and accretion     (452 )     (1,161 )
  Net income available to common shareholders   $ 5,329     $ 4,700  
                   
  Earnings per common share - basic     0.69       0.61  
  Earnings per common share - diluted     0.69       0.61  
  Dividends declared per common share     -       -  
  Return on average common equity     8.80 %     8.67 %
  Return on average assets     0.95 %     1.02 %
  Net interest margin (1)     4.52 %     4.83 %
  Efficiency ratio (1)     63.83 %     61.28 %
                 
Capital - Period End                
  Book value per share   $ 7.99     $ 7.37  
                 
Credit Quality - Period End                
  Nonperforming assets/ total assets     1.05 %     1.22 %
  Loan loss reserve/ gross loans     2.04 %     2.17 %
                 
Period End Balance Sheet                
($ in thousands)                
  Total assets   $ 660,480     $ 612,172  
  Gross loans     390,986       396,202  
  Nonperforming assets     6,923       7,477  
  Allowance for loan losses     7,975       8,609  
  Deposits     586,993       536,204  
  Common equity     63,219       56,902  
  Total capital (2)     69,969       70,402  
                 
Non-Financial Data                
  Full-time equivalent staff     130       128  
  Number of banking offices     14       14  
                 
Common Shares outstanding                
  Period end     7,907,780       7,718,469  
  Period average - basic     7,740,990       7,708,853  
  Period average - diluted     7,766,745       7,738,999  
                 
Market Ratios                
  Stock Price   $ 7.45     $ 6.75  
  Price/Earnings     10.85       11.07  
  Price/Book     0.93       0.92  
                 
(1) Ratio computed on a fully tax equivalent basis using a marginal federal tax rate of 34%.  
(2) Includes $6.75 million in preferred stock issued to the U.S. Treasury under the SBLF Program.  
Prior to 6/30/2012, the amount of preferred stock issued was $13.5 million.  

Contact Information

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