Oak Valley Bancorp Reports 2nd Quarter Results

Oak Valley Bancorp Reports 2nd Quarter Results 
OAKDALE, CA -- (Marketwired) -- 07/16/14 --  Oak Valley Bancorp
(NASDAQ: OVLY), the bank holding company for Oak Valley Community
Bank and Eastern Sierra Community Bank, recently reported
consolidated financial results. For the three months ended June 30,
2014, consolidated net income available to common shareholders was
$2,537,000, or $0.32 per diluted common share. This compared to
consolidated net income available to common shareholders of
$1,374,000, or $0.18 per diluted common share for the same period a
year ago.  
Total assets were $678.3 million at June 30, 2014, an increase of
$34.1 million, or 5.3%, from June 30, 2013. The Company's total
deposits were $603.0 million as of June 30, 2014, an increase of
$25.8 million, or 4.5% over June 30, 2013. Gross loans increased to
$435.7 million at June 30, 2014, an increase of $45.0 million, or
11.5% from June 30, 2013. 
Net interest income increased $151,000 or 2.5% to $6.2 million for
the three months ended June 30, 2014, compared to $6.0 million for
the same period last year. The increase is driven primarily by the
increase in loan volume, as the interest rate environment continues
to compress loan and investment yields. The Company's net interest
margin for the three months ended June 30, 2014 was 4.07%, compared
to 4.18% for the same period last year.  
In addition to income from normal operations, during the quarter, the
Company also reached a settlement of $2.92 million on a previously
written down asset, which ultimately led to a net recovery of $1.88
million. The entire $1.88 million was recognized in income through a
credit to the loan loss provision.  
"We are very pleased to report another solid operational performance
for the quarter. Despite continued margin pressure, the efforts of
our relationship management teams are producing results that are
fueling earnings," stated Chris Courtney, President and CEO of the
Company and the Bank. "We acknowledge the tremendous impact of the
recovery the Bank recorded during the quarter, yet we are equally
energized by the loan growth we've experienced and the underlying
momentum we seem to be building within the local business community,"
Courtney concluded. 
Non-interest expense for the three month and six month periods ended
June 30, 2014 totaled $5.0 million and $9.9 million, respectively, an
increase over the $4.7 million and $9.4 million for the comparable
periods in 2013. This increase corresponds to growth in full time
equivalent staff from 134 to 144. Deposit servicing costs associated
with deposit growth and transaction activity have also increased.  
Non-performing assets as of June 30, 2014 were $5.1 million, or 0.75%
of total assets, as compared to $4.2 million, or 0.65% at June 30,
2013. The increase is the net result of the Bank placing one
additional loan relationship on non-accrual status during the first
quarter of 2014 and receiving the remaining principal payment from
the aforementioned loan settlement.  
The recovery resulted in a reversal of provision for loan losses of
$1.88 million for the quarter ended June 30, 2014, as compared to a
provision of $100,000 for the same period of the previous year. The
ratio of loan loss reserves to gross loans decreased to 1.74% as of
June 30, 2014, compared to 1.94% at June 30, 2013. 
The Company recently announced the payment of a cash dividend of
$0.065 per share of common stock to its shareholders of record at the
close of business on July 14, 2014. In aggregate, the distribution
will amount to approximately $524,000. This is the second dividend
payment made by the Company in 2014. 
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. The
Company also recently announced plans to open a branch in Tracy later
this summer. 
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)                                                                     
Selected             2nd         1st         4th         3rd         2nd    
 Quarterly         Quarter     Quarter     Quarter     Quarter     Quarter  
 Operating Data:    2014        2014        2013        2013        2013    
                                                                            
  Net interest                                                              
   income        $    6,175  $    6,104  $    6,372  $    6,030  $    6,024 
  Provision for                                                             
   loan losses       (1,877)          -           -         100         100 
  Non-interest                                                              
   income               927         810         812         866         818 
  Non-interest                                                              
   expense            4,989       4,881       4,668       4,619       4,734 
  Net income                                                                
   before income                                                            
   taxes              3,990       2,033       2,516       2,177       2,008 
  Provision for                                                             
   income taxes       1,453         625         809         672         634 
                 ----------  ----------  ----------  ----------  ---------- 
  Net income                                                                
   available to                                                             
   common                                                                   
   shareholders       2,537       1,408       1,707       1,505       1,374 
                 ==========  ==========  ==========  ==========  ========== 
                                                                            
  Earnings per                                                              
   common share                                                             
   - basic       $     0.32  $     0.18  $     0.22  $     0.19  $     0.18 
  Earnings per                                                              
   common share                                                             
   - diluted     $     0.32  $     0.18  $     0.22  $     0.19  $     0.18 
  Dividends paid                                                            
   per common                                                               
   share         $        -  $     0.10  $        -  $        -  $        - 
  Return on                                                                 
   average                                                                  
   common equity      14.53%       8.59%      10.47%       9.45%       8.48%
  Return on                                                                 
   average                                                                  
   assets              1.50%       0.84%       1.01%       0.92%       0.86%
  Net interest                                                              
   margin (1)          4.07%       4.04%       4.19%       4.12%       4.18%
  Efficiency                                                                
   ratio (2)          67.55%      68.29%      63.05%      64.65%      67.17%
                                                                            
Capital - Period                                                            
 End                                                                        
  Book value per                                                            
   common share  $     8.84  $     8.40  $     8.14  $     7.99  $     8.01 
                                                                            
Credit Quality -                                                            
 Period End                                                                 
  Nonperforming                                                             
   assets/ total                                                            
   assets              0.75%       0.90%       0.48%       0.68%       0.65%
  Loan loss                                                                 
   reserve/                                                                 
   gross loans         1.74%       1.80%       1.83%       1.85%       1.94%
                                                                            
Period End                                                                  
 Balance Sheet                                                              
($ in thousands)                                                            
  Total assets   $  678,319  $  687,591  $  671,853  $  659,192  $  644,230 
  Gross loans       435,671     422,510     419,438     413,856     390,647 
  Nonperforming                                                             
   assets             5,065       6,164       3,256       4,495       4,189 
  Allowance for                                                             
   loan losses        7,602       7,615       7,659       7,669       7,570 
  Deposits          602,978     615,997     602,633     591,642     577,129 
  Common equity      71,369      67,824      64,517      63,379      63,457 
                                                                            
Non-Financial                                                               
 Data                                                                       
  Full-time                                                                 
   equivalent                                                               
   staff                144         142         136         135         134 
  Number of                                                                 
   banking                                                                  
   offices               14          14          14          14          14 
                                                                            
Common Shares                                                               
 outstanding                                                                
  Period end      8,075,855   8,071,355   7,929,730   7,929,730   7,924,730 
  Period average                                                            
   - basic        7,953,499   7,878,152   7,803,247   7,802,705   7,802,012 
  Period average                                                            
   - diluted      8,001,815   7,941,456   7,859,380   7,851,157   7,842,964 
                                                                            
Market Ratios                                                               
  Stock Price    $     9.93  $     9.41  $     8.37  $     7.96  $     7.67 
  Price/Earnings       7.76       12.98        9.64       10.40       10.86 
  Price/Book           1.12        1.12        1.03        1.00        0.96 
                                                                            
                                                                            
                                                                            
                                               SIX MONTHS ENDED JUNE 30,    
                                                 2014             2013      
                                           ---------------  --------------- 
                                                                            
  Net interest income                      $        12,279  $        11,873 
  Provision for loan losses                         (1,877)             200 
  Non-interest income                                1,737            1,603 
  Non-interest expense                               9,870            9,373 
  Net income before income taxes                     6,023            3,903 
  Provision for income taxes                         2,078            1,229 
                                           ---------------  --------------- 
  Net income                                         3,945            2,674 
  Preferred stock dividends                              -              (68)
                                           ---------------  --------------- 
  Net income available to common                                            
   shareholders                            $         3,945  $         2,606 
                                           ===============  =============== 
                                                                            
  Earnings per common share - basic        $          0.50  $          0.33 
  Earnings per common share - diluted      $          0.49  $          0.33 
  Dividends paid per common share          $          0.10  $             - 
  Return on average common equity                    11.65%            8.16%
  Return on average assets                            1.17%            0.84%
  Net interest margin (1)                             4.06%            4.11%
  Efficiency ratio (2)                               67.91%           67.55%
                                                                            
Capital - Period End                                                        
  Book value per common share              $          8.84  $          8.01 
                                                                            
Credit Quality - Period End                                                 
  Nonperforming assets/ total assets                  0.75%            0.65%
  Loan loss reserve/ gross loans                      1.74%            1.94%
                                                                            
Period End Balance Sheet                                                    
($ in thousands)                                                            
  Total assets                             $       678,319  $       644,230 
  Gross loans                                      435,671          390,647 
  Nonperforming assets                               5,065            4,189 
  Allowance for loan losses                          7,602            7,570 
  Deposits                                         602,978          577,129 
  Common equity                                     71,369           63,457 
                                                                            
Non-Financial Data                                                          
  Full-time equivalent staff                           144              134 
  Number of banking offices                             14               14 
                                                                            
Common Shares outstanding                                                   
  Period end                                     8,075,855        7,924,730 
  Period average - basic                         7,916,034        7,790,238 
  Period average - diluted                       7,971,802        7,836,736 
                                                                            
Market Ratios                                                               
  Stock Price                              $          9.93  $          7.67 
  Price/Earnings                                      9.88            11.37 
  Price/Book                                          1.12             0.96 
                                                                            
                                                                            
(1) Ratio computed on a fully tax equivalent basis using a marginal federal 
 tax rate of 34%.                                                           
(2) Ratio computed on a fully tax equivalent basis using a marginal federal 
 tax rate of 34%, and a marginal federal/state combined tax rate of 41.15%  
 for applicable revenue.                                                    

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