Oak Valley Bancorp Amends 4th Quarter Results

Oak Valley Bancorp Amends 4th Quarter Results 
OAKDALE, CA -- (Marketwired) -- 03/18/14 --  Oak Valley Bancorp
(NASDAQ: OVLY), the bank holding company for Oak Valley Community
Bank and Eastern Sierra Community Bank, recently published a revision
to their fourth quarter results, which were first published January
22, 2014. Changes to the financial results reduced reported common
equity and total capital by $793,000 as a result of the common stock
dividend that was declared in December 2013, but inadvertently was
not transferred out of equity and into a liability account at that
time. The effect of the error was that the book value per share
should have been $8.14 instead of $8.24 and the price to book ratio
should have been 1.03 instead of 1.02. Also, due to a
reclassification of deferred tax assets, reported total assets
decreased by $207,000, which was reported as $672.1 million and
should have been $671.9 million. The original release is amended and
restated as follows and the financial tables below have been adjusted
accordingly to reflect these changes.  
For the three months ended December 31, 2013, consolidated net income
available to common shareholders was a record $1.7 million, or $0.22
per diluted share. This compared to consolidated net income available
to common shareholders of $1.4 million, or $0.18 per diluted share
for the three months ended December 31, 2012 and represented a 21.5%
increase over the prior year.  
Net income for 2013 totaled $5.9 million compared to $5.8 million for
2012. After adjustment for preferred stock dividends and accretion,
consolidated net income available to common shareholders was $5.8
million, or $0.74 per diluted share, compared to consolidated net
income of $5.3 million, or $0.69 per diluted common share, in 2012.
This represents a 9.2% increase in consolidated net income available
to common shareholders and marks a new annual earnings record for Oak
Valley Bancorp.  
Total assets grew to $671.9 million as of December 31, 2013, which
was an increase of $11.3 million, or 1.7% over the prior year.
Deposits increased to $602.6 million, which was an increase of $15.6
million, or 2.7% over the prior year. Gross loans at year end totaled
$419.4 million, reflecting an increase of $28.5 million, or 7.3%,
over December 31, 2012.  
"We are pleased to report another year of solid earnings. Our
commitment to customer care and relationship building is unwavering
and the cornerstone of our success," stated Chris Courtney, President
and CEO of the Company and the Bank. "Our results are a reflection of
emerging consumer confidence and economic expansion in the
communities we serve."  
Non-performing assets were $3.3 million, or 0.48% of total assets at
December 31, 2013. This is down from $6.9 million, or 1.05% at
December 31, 2012. There are currently six properties remaining with
the non-performing classification; five of which remain as loans,
along with one property taken into OREO.  
The allowance for loan losses totaled 1.83% of gross loans at
December 31, 2013 compared to 2.04% at December 31, 2012. The annual
provision for loan losses of $300,000 in 2013 was down from $1.2
million in 2012. Given the high quality of the loan portfolio,
limited provisioning was required to support the growth of the
portfolio. 
Net interest income of $24.3 million for the year ended December 31,
2013, decreased by $570,000, or 2.3%, from the prior year. The year
began with margin compression, corresponding to low loan pricing and
high cash balances. The margin stabilized in the second half of the
year, as cash was deployed into new loans. The Company's net interest
margin was 4.13% for the year ended December 31, 2013, compared to
4.53% for the year ended December 31, 2012. Net interest margin for
the three months ended December 31, 2013 was 4.19%, compared to 4.15%
for the three months ended December 31, 2012.  
Non-interest income was $3.3 million for the year ended December 31,
2013, compared to $3.1 million the prior year. The increase is
partially attributable to additional fee income related to deposit
growth and commissions corresponding to growth in Oak Valley
Investments.  
Non-interest expense was $18.7 million for the year ended December
31, 2013, compared to $18.2 million for the prior year, an increase
of $411,000, or 2.3%. This increase consists primarily of costs
associated with servicing deposit growth across all branches.  
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:    2013        2013        2013        2013        2012    
                 ----------  ----------  ----------  ----------  ---------- 
                                                                            
  Net interest                                                              
   income        $    6,372  $    6,030  $    6,024  $    5,849  $    6,115 
  Provision for                                                             
   loan losses            -         100         100         100         250 
  Non-interest                                                              
   income               812         866         818         785         855 
  Non-interest                                                              
   expense            4,668       4,619       4,734       4,639       4,513 
  Income before                                      
                       
   income taxes       2,516       2,177       2,008       1,895       2,207 
  Provision for                                                             
   income taxes         809         672         634         595         718 
                 ----------  ----------  ----------  ----------  ---------- 
  Net income          1,707       1,505       1,374       1,300       1,489 
  Preferred stock                                                           
   dividends and                                                            
   accretion              -           -           -         (68)        (84)
                 ----------  ----------  ----------  ----------  ---------- 
  Net income                                                                
   available to                                                             
   common                                                                   
   shareholders  $    1,707  $    1,505  $    1,374  $    1,232  $    1,405 
                 ==========  ==========  ==========  ==========  ========== 
                                                                            
  Earnings per                                                              
   common share -                                                           
   basic         $     0.22  $     0.19  $     0.18  $     0.16  $     0.18 
  Earnings per                                                              
   common share -                                                           
   diluted       $     0.22  $     0.19  $     0.18  $     0.16  $     0.18 
  Return on                                                                 
   average common                                                           
   equity             10.47%       9.45%       8.48%       7.82%       8.87%
  Return on                                                                 
   average assets      1.01%       0.92%       0.86%       0.81%       0.91%
  Net interest                                                              
   margin (1)          4.19%       4.12%       4.18%       4.05%       4.15%
  Efficiency                                                                
   ratio (1)          63.05%      64.65%      67.17%      67.95%      63.23%
                                                                            
Capital - Period                                                            
 End                                                                        
  Book value per                                                            
   share         $     8.14  $     7.99  $     8.01  $     8.10  $     7.99 
                                                                            
Credit Quality -                                                            
 Period End                                                                 
  Nonperforming                                                             
   assets/ total                                                            
   assets              0.48%       0.68%       0.65%       0.99%       1.05%
  Loan loss                                                                 
   reserve/ gross                                                           
   loans               1.83%       1.85%       1.94%       1.99%       2.04%
                                                                            
Period End                                                                  
 Balance Sheet                                                              
($ in thousands)                                                            
  Total assets   $  671,853  $  659,192  $  644,230  $  648,418  $  660,581 
  Gross loans       419,438     413,856     390,647     389,992     390,986 
  Nonperforming                                                             
   assets             3,256       4,495       4,189       6,439       6,923 
  Allowance for                                                             
   loan losses        7,659       7,669       7,570       7,743       7,975 
  Deposits          602,633     591,642     577,129     580,215     586,993 
  Common equity      64,517      63,379      63,457      64,098      63,219 
  Total capital                                                             
   (2)               64,517      63,379      63,457      64,098      69,969 
                                                                            
Non-Financial                                                               
 Data                                                                       
  Full-time                                                                 
   equivalent                                                               
   staff                136         135         134         134         130 
  Number of                                                                 
   banking                                                                  
   offices               14          14          14          14          14 
                                                                            
Common Shares                                                               
 outstanding                                                                
  Period end      7,929,730   7,929,730   7,924,730   7,914,730   7,907,780 
  Period average                                                            
   - basic        7,803,247   7,802,705   7,802,012   7,778,333   7,762,261 
  Period average                                                            
   - diluted      7,859,380   7,851,157   7,842,964   7,830,439   7,793,523 
                                                                            
Market Ratios                                                               
  Stock Price    $     8.37  $     7.96  $     7.67  $     8.14  $     7.45 
  Price/Earnings       9.64       10.40       10.86       12.67       10.38 
  Price/Book           1.03        1.00        0.96        1.01        0.93 
                                                                            
                                                                            
                                                                            
                   YEAR ENDED DECEMBER                                      
                           31,                                              
                    2013        2012                                        
                 ----------  ----------                                     
                                                                            
($ in thousands,                                                            
 except per                                                                 
 share)                                                                     
Selected                                                                    
 Quarterly                                                                  
 Operating Data:                                                            
                                                                            
  Net interest                                                              
   inco
me        $   24,275  $   24,845                                     
  Provision for                                                             
   loan losses          300       1,150                                     
  Non-interest                                                              
   income             3,281       3,148                                     
  Non-interest                                                              
   expense           18,660      18,249                                     
  Income before                                                             
   income taxes       8,596       8,594                                     
  Provision for                                                             
   income taxes       2,710       2,813                                     
                 ----------  ----------                                     
  Net income          5,886       5,781                                     
  Preferred stock                                                           
   dividends and                                                            
   accretion            (68)       (452)                                    
                 ----------  ----------                                     
  Net income                                                                
   available to                                                             
   common                                                                   
   shareholders  $    5,818  $    5,329                                     
                 ==========  ==========                                     
                                                                            
  Earnings per                                                              
   common share -                                                           
   basic         $     0.75  $     0.69                                     
  Earnings per                                                              
   common share -                                                           
   diluted       $     0.74  $     0.69                                     
  Return on                                                                 
   average common                                                           
   equity              9.07%       8.80%                                    
  Return on                                                                 
   average assets      0.90%       0.95%                                    
  Net interest                                                              
   margin (1)          4.13%       4.53%                                    
  Efficiency                                                                
   ratio (1)          65.65%      63.83%                                    
                                                                            
Capital - Period                                                            
 End                                                                        
  Book value per                                                            
   share         $     8.14  $     7.99                                     
                                                                            
Credit Quality -                                                            
 Period End                                                                 
  Nonperforming                                                             
   assets/ total                                                            
   assets              0.48%       1.05%                                    
  Loan loss                                                                 
   reserve/ gross                                                           
   loans               1.83%       2.04%                                    
                                                                            
Period End                                                                  
 Balance Sheet                                                              
($ in thousands)                                                            
  Total assets   $  671,853  $  660,581                                     
  Gross loans       419,438     390,986                                     
  Nonperforming                                                             
   assets             3,256       6,923                                     
  Allowance for                                                             
   loan losses        7,659       7,975                                     
  Deposits          602,633     586,993                                     
  Common equity      64,517      63,219                                     
  Common equity      64,517      69,969                                     
                                                                            
Non-Financial                                                               
 Data                                                                       
  Full-time                                                                 
   equivalent                                                               
   staff                136         130                                     
  Number of                                                                 
   banking                                                                  
   offices               14          14                                     
                                                                            
Common Shares                                                               
 outstanding                                                                
  Period end      7,929,730   7,907,780                                     
  Period average                                                            
   - basic        7,796,659   7,740,990                                     
  Period average                                                            
   - diluted      7,846,078   7,766,745                                     
                                                                            
Market Ratios                                                               
  Stock Price    $     8.37  $     7.45                                     
  Price/Earnings      11.22       10.85                                     
  Price/Book           1.03        0.93                                     
                                                                            
                                                                            
  (1) Ratio computed on a fully tax equivalent basis using a marginal       
  federal tax rate of 34%.                                                  
  (2) Includes preferred stock issued to the U.S. Treasury under the SBLF   
  Program of $6.75 million for the quarter ended December 31, 2012. There   
  was no preferred stock outstanding as of March 31, June 30, September 30, 
  and December 31, 2013.                                                    

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