Oak Valley Bancorp Reports 4th Quarter Results

Oak Valley Bancorp Reports 4th Quarter Results 
OAKDALE, CA -- (Marketwire) -- 01/22/13 --  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          4th         3rd         2nd         1st         4th    
 share)            Quarter     Quarter     Quarter     Quarter     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: 
Ron Martin/Chris Courtney/Rick McCarty
Phone: (209) 848-2265 
www.ovcb.com 
 
 
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