Bank of Virginia Announces Year-End Results for 2010 and Realignment of Business Strategy
02 4월 2011 - 7:15AM
Bank of Virginia (Nasdaq:BOVA) (www.bankofva.com), has announced
financial results for the year ended December 31, 2010.
For the year ended December 31, 2010, the Bank reported a net
loss of $9.2 million, or ($1.85) per share, compared with a net
loss of $4.2 million or ($1.39) per share for the year ended
December 31, 2009. The loss primarily occurred as a result of a
considerable increase in the provision for loan losses from the
2009 amount of $4.5 million to $9.0 million in 2010. Further
deterioration in the quality of the Bank's loan portfolio combined
with a fourth quarter enhancement of procedures for earlier
identification of problem loans led to the additional charges. The
Bank improved its net interest income by $287,000, or 4.7%, to $6.4
million in 2010, compared to $6.1 million in 2009. The net interest
margin for 2010 improved to 3.09% from 2.88% in 2009. The
improvement in net interest margin was the result of repricing our
interest-bearing liabilities lower by 76 basis points, while the
pricing on interest-earning assets was reduced by 48 basis points
from 2009.
Review of the balance sheet
The Bank's total assets decreased $12.4 million, or 5.6%, to
$209.2 million at December 31, 2010 from December 31, 2009's total
of $221.6 million. The main driver behind the reduction of assets
was the $26.6 million, or 16%, decline in net loans from $166.3
million in 2009 to $139.7 million in 2010. The decline in loan
balances was attributable to loan charge-offs and pay downs in the
absence of significant new lending. The Bank was restricted from
loan portfolio growth under the terms of its Written Agreement with
banking regulators. Offsetting that reduction in loans was an
increase of cash and cash equivalents to $25.7 million from $8.1
million, an increase of $17.6 million, or 217.3%. On the liability
side of the balance sheet, total deposits were $181.2 million at
December 31, 2010, down from $193.1 million at year end 2009, a
drop of $11.9 million, or 6.2%. The Bank did not renew certain
higher costing time deposits in 2010, thereby reducing its costs of
funds. Time deposits balances fell $8.0 million from $148.2
million at December 31, 2009 to $140.2 million at December 31,
2010. Total liabilities were $192.2 million and $204.4 million at
December 31, 2010 and 2009, respectively.
The Bank's total capital at December 31, 2010 was $17.0 million
compared to $17.2 million at December 31, 2009. In December 2010,
the Bank restored its well-capitalized status according to
regulatory guidelines. The Bank's capital ratios at December
31, 2010 were as follows: tier one leverage capital of 7.9%,
tier one risked based capital of 10.9%, and total risked based
capital of 12.2%. The Bank closed an equity transaction on December
10, 2010, with Cordia Bancorp, which infused $9.6 million in new
net capital, making the Bank a majority-owned subsidiary of Cordia
Bancorp.
Recent Changes
In December 2010, the Bank enhanced its board oversight through
the appointment of six new directors in conjunction with the Cordia
transaction. Furthermore, Jack Zoeller was appointed Chairman,
President and Chief Executive Officer and Nancy Corsiglia, Chief
Financial Officer, further strengthening the management and
operations of the Bank.
Highlights of 2011 Strategic Plan
In early 2011, the Bank developed a realignment plan for its
loan quality and service and delivery system. The major components
of the plan are as follows: reduction of full time equivalent
staff, Saturday closure of a low traffic retail location, closure
of a full–service branch located in close proximity to the Bank's
main office, as well as the hiring new senior credit and lending
staff.
"We have made significant improvements to manage the asset
quality issues caused by the current credit cycle and continue to
take a very conservative approach to lending. Although the
negative results were expected, they do create a great opportunity
for the Bank, especially with the additional resources and talent
we have added to our Board of Directors and Senior Management team.
Moreover, the additional capital from Cordia provides a foundation
for repositioning the Bank and returning it to long-term
profitability," said Jack Zoeller, Chairman and CEO.
About Bank of Virginia
Bank of Virginia, a Virginia state chartered bank headquartered
in Midlothian, Virginia, currently operates five full-service
offices in the counties of Chesterfield and Henrico, Virginia. Bank
of Virginia's common stock is traded on the NASDAQ stock market
under the quotation symbol "BOVA". Additional investor relations
information can be found on the internet at www.bankofva.com. Bank
of Virginia is a member of the FDIC and Equal Housing Lender.
About Cordia Bancorp
Cordia Bancorp is a private bank holding company incorporated in
2009 by a team of former bank CEOs, directors and advisors seeking
to invest in undervalued or troubled community banks in the
Mid-Atlantic and Southeast. Its application to become a bank
holding company and to buy a majority interest in the Bank was
approved by the Board of Governors of the Federal Reserve in
November 2010. Cordia purchased $10,300,000 of the Bank's common
stock at a price of $1.52 per share, resulting in the ownership of
approximately 59.8% of the outstanding shares. Additional
information about Cordia can be found at www.cordiabancorp.com.
DISCLAIMER
This news release may include forward-looking statements. These
forward-looking statements are based on current expectations that
involve risks, uncertainties and assumptions. Should one or more of
these risks or uncertainties materialize or should underlying
assumptions prove incorrect, actual results may differ materially.
These risks include: changes in business or other market
conditions; the timely development, production and acceptance of
new products and services; the challenge of managing
asset/liability levels; the management of credit risk and interest
rate risk; the difficulty of keeping expense growth at modest
levels while increasing revenues; and other risks detailed from
time to time in the Bank's periodic filings with the Board of
Governors of the Federal Reserve System, including the Bank's
annual report on Form 10-K as filed with the Board of Governors of
the Federal Reserve. Pursuant to the Private Securities Litigation
Reform Act of 1995, the Bank does not undertake to update
forward-looking statements contained within this news release.
|
|
|
BANK OF
VIRGINIA |
Balance
Sheets |
|
|
|
|
|
|
December
31, |
|
2010 (audited) |
2009 (audited) |
|
|
|
Assets |
|
|
Cash and due from banks |
$ 25,641,357 |
$ 4,596,953 |
Federal funds sold and interest bearing
deposits with banks |
42,925 |
3,527,759 |
Total cash and cash equivalents |
25,684,282 |
8,124,712 |
Securities available for sale, at fair
market value |
34,956,000 |
38,109,075 |
Restricted securities |
1,435,150 |
1,475,350 |
Loans net of allowance for loan losses of
$6,832,444 and $5,222,023 in 2010 and 2009, respectively |
139,739,604 |
166,342,222 |
Premises and equipment, net |
5,655,255 |
5,630,860 |
Accrued interest receivable |
774,101 |
849,201 |
Other real estate owned, net of valuation
allowance |
551,076 |
578,535 |
Other assets |
394,948 |
441,565 |
Total assets |
$ 209,190,416 |
$ 221,551,520 |
|
|
|
Liabilities and Stockholders'
Equity |
|
|
Deposits |
|
|
Non-interest bearing |
$ 14,506,462 |
$ 14,701,106 |
Savings and interest-bearing demand |
26,488,921 |
30,211,719 |
Time, $100,000 and over |
64,148,592 |
60,631,093 |
Other time |
76,096,688 |
87,598,774 |
Total deposits |
181,240,663 |
193,142,692 |
|
|
|
Accrued expenses and other
liabilities |
970,143 |
1,213,562 |
FHLB borrowings |
10,000,000 |
10,000,000 |
Total liabilities |
192,210,806 |
204,356,254 |
|
|
|
Stockholders' Equity |
|
|
Preferred stock, $5 par value, 5,000,000
shares authorized, none issued |
- - |
- - |
Common stock, 40,000,000 shares
authorized, in 2010, $1 par value, 11,328,182, shares issued and
outstanding; in 2009, $2.50 par value, 4,551,866 shares issued and
outstanding |
11,328,182 |
11,379,665 |
Additional paid-in capital |
24,610,544 |
14,975,103 |
Retained deficit |
(19,277,288) |
(10,126,367) |
Accumulated other comprehensive
income |
318,172 |
966,865 |
Total stockholders'
equity |
16,979,610 |
17,195,266 |
Total liabilities and stockholders'
equity |
$ 209,190,416 |
$ 221,551,520 |
|
|
|
BANK OF
VIRGINIA |
Statements of
Operations |
Years Ended December
31, 2010 and 2009 |
|
|
|
|
|
2010 (audited) |
2009 (audited) |
Interest income |
|
|
Interest and fees on loans |
$ 9,313,952 |
$ 10,041,122 |
Investment securities |
1,500,691 |
2,042,383 |
Federal funds sold and deposits with
banks |
17,374 |
7,019 |
Total interest
income |
10,832,017 |
12,090,524 |
Interest expense |
|
|
Interest on deposits |
4,009,181 |
5,531,975 |
Interest on federal funds purchased |
103 |
6,187 |
Interest on FHLB borrowings |
443,088 |
459,852 |
Total interest
expense |
4,452,372 |
5,998,014 |
Net interest income |
6,379,645 |
6,092,510 |
Provision for loan losses |
9,017,516 |
4,483,650 |
Net interest income (loss) after
provision for loan losses |
(2,637,871) |
1,608,860 |
|
|
|
Non-interest income |
|
|
Service charges on deposit accounts |
170,046 |
182,040 |
Net gain on sale of available for
sale securities |
544,173 |
281,287 |
Other fee income |
142,886 |
173,652 |
Loss on sale and impairment of
OREO |
(25,337) |
(228,036) |
Total non-interest
income |
831,768 |
408,943 |
|
|
|
Non-interest expense |
|
|
Salaries and employee benefits |
3,426,463 |
3,240,723 |
Occupancy expense |
662,273 |
516,298 |
Equipment expense |
343,258 |
260,589 |
Data processing |
405,758 |
480,628 |
Marketing expense |
162,978 |
144,207 |
Legal and professional |
650,134 |
351,913 |
Bank franchise tax |
130,570 |
131,160 |
FDIC assessment |
669,093 |
428,949 |
Other operating expenses |
894,291 |
675,762 |
Total non-interest
expense |
7,344,818 |
6,230,229 |
Net loss |
$ (9,150,921) |
$ (4,212,426) |
Basic loss per
share |
$ (1.85) |
$ (1.39) |
Diluted loss per
share |
$ (1.85) |
$ (1.39) |
|
|
|
Weighted average shares outstanding,
basic |
4,941,736 |
3,040,195 |
Weighted average shares outstanding,
diluted |
4,941,736 |
3,040,195 |
|
|
|
|
|
Bank of
Virginia |
Quarterly Earnings
Summary |
(Unaudited) |
|
|
|
|
|
|
2010 |
|
March 31 |
June 30 |
Sept 30 |
Dec 31 |
|
|
Interest income |
$ 2,816,769 |
$ 2,619,999 |
$ 2,754,815 |
$ 2,640,434 |
Interest expense |
1,208,587 |
1,145,138 |
1,104,559 |
994,088 |
Net interest income |
1,608,182 |
1,474,861 |
1,650,256 |
1,646,346 |
Provision for loan
losses |
325,885 |
161,543 |
4,841,759 |
3,688,329 |
Net interest income (loss) after
provision for loan losses |
1,282,297 |
1,313,318 |
(3,191,503) |
(2,041,983) |
Other income |
67,066 |
74,664 |
59,813 |
86,051 |
Securities gains |
94,428 |
-- |
14,825 |
434,920 |
Other expenses |
1,801,890 |
1,652,119 |
1,771,619 |
2,119,189 |
(Loss) income before income
taxes |
(358,099) |
(264,137) |
(4,888,484) |
(3,640,201) |
Income taxes |
-- |
-- |
-- |
-- |
Net (loss) |
$ (358,099) |
$ (264,137) |
$ (4,888,484) |
$ (3,640,201) |
Basic (loss) per share |
$ (0.08) |
$ (0.06) |
$ (1.07) |
$ (0.60) |
Diluted (loss) per
share |
$ (0.08) |
$ (0.06) |
$ (1.07) |
$ (0.60) |
Dividends |
$ -- |
$ -- |
$ -- |
$ -- |
Weighted-average basic
shares |
4,551,866 |
4,551,866 |
4,551,866 |
6,057,714 |
Weighted-average diluted
shares |
4,551,866 |
4,551,866 |
4,551,866 |
6,057,714 |
|
|
|
|
|
|
|
|
|
|
|
2009 |
|
March 31 |
June 30 |
Sept 30 |
Dec 31 |
|
|
Interest income |
$ 2,934,147 |
$ 3,054,114 |
$ 3,077,017 |
$ 3,025,246 |
Interest expense |
1,551,378 |
1,592,965 |
1,505,434 |
1,348,237 |
Net interest income |
1,382,769 |
1,461,149 |
1,571,583 |
1,677,009 |
Provision for loan
losses |
69,750 |
3,570,525 |
(181,576) |
1,024,951 |
Net interest income after provision
for loan losses |
1,313,019 |
(2,109,376) |
1,753,159 |
652,058 |
Other income |
85,602 |
105,947 |
89,336 |
(153,229) |
Securities gains |
59,501 |
96,431 |
119,361 |
5,994 |
Other expenses |
1,356,834 |
1,450,846 |
1,431,487 |
1,991,062 |
(Loss) income before income
taxes |
101,288 |
(3,357,844) |
530,369 |
(1,486,239) |
Income taxes |
-- |
-- |
-- |
-- |
Net (loss) income |
$ 101,288 |
$ (3,357,844) |
$ 530,369 |
$ (1,486,239) |
Basic earnings (loss) per
share |
$ 0.03 |
$ (1.11) |
$ 0.17 |
$ (0.48) |
Diluted earnings (loss) per
share |
$ 0.03 |
$ (1.11) |
$ 0.17 |
$ (0.48) |
Dividends |
$ -- |
$ -- |
$ -- |
$ -- |
Weighted-average basic
shares |
3,031,866 |
3,031,866 |
3,031,866 |
3,064,909 |
Weighted-average diluted
shares |
3,031,866 |
3,031,866 |
3,031,866 |
3,064,909 |
|
|
|
|
|
|
|
Average Balance
Sheets and Net Interest Income Analysis (unaudited) |
|
|
|
|
|
|
|
|
2010 |
2009 |
|
Average |
Interest |
Yield/ |
Average |
Interest |
Yield/ |
|
Balance |
|
Rate |
Balance |
|
Rate |
Earning Assets: |
|
|
|
|
|
|
Loans: |
|
|
|
|
|
|
Held for Investment (1)(2) |
|
|
|
|
|
|
Taxable |
$ 155,881,574 |
$ 9,313,952 |
5.98% |
$ 166,061,284 |
$ 10,041,122 |
6.05% |
Securities Available for Sale: |
|
|
|
|
|
|
Taxable |
44,177,360 |
1,500,691 |
3.40% |
42,466,085 |
2,042,383 |
4.81% |
Interest Bearing |
|
|
|
|
|
|
Deposits with Banks |
48,402 |
833 |
1.72% |
-- |
-- |
|
Federal Funds Sold |
6,436,436 |
16,541 |
0.26% |
2,947,390 |
7,019 |
0.24% |
Total Earning Assets |
206,543,772 |
$ 10,832,017 |
5.24% |
211,474,759 |
$ 12,090,524 |
5.72% |
Other Assets |
15,452,277 |
|
|
10,021,129 |
|
|
Total |
$ 221,996,049 |
|
|
$ 221,495,888 |
|
|
Interest-Bearing Liabilities: |
|
|
|
|
|
|
Demand Deposits |
$ 7,236,365 |
28,478 |
0.39% |
$ 6,819,076 |
29,598 |
0.43% |
Savings Deposits |
23,705,408 |
236,431 |
1.00% |
18,468,997 |
237,040 |
1.28% |
Time Deposits |
144,945,204 |
3,744,272 |
2.58% |
151,888,433 |
5,265,337 |
3.47% |
Federal Funds Purchased |
10,151 |
103 |
1.01% |
614,496 |
6,187 |
1.01% |
FHLB Borrowings |
10,000,000 |
443,088 |
4.43% |
12,109,589 |
459,852 |
3.80% |
Total Interest-bearing |
|
|
|
|
|
|
Liabilities |
185,897,128 |
4,452,372 |
2.40% |
189,900,591 |
5,998,014 |
3.16% |
|
|
|
|
|
|
|
Other Liabilities |
16,469,614 |
|
|
15,222,222 |
|
|
Stockholders' Equity |
19,629,307 |
|
|
16,373,075 |
|
|
Total |
$ 221,996,049 |
|
|
$ 221,495,888 |
|
|
Net Interest Income |
|
$ 6,379,645 |
|
|
$ 6,092,510 |
|
Net Interest Rate Spread (3) |
|
|
2.84% |
|
|
2.56% |
Net Interest Margin (4) |
|
|
3.09% |
|
|
2.88% |
|
|
|
|
|
|
|
(1) Non-accrual loans, if any,
are included in average balances outstanding, with no related
interest income during non-accrual period. |
(2) The effect of fees collected
on loans totaling $33,000 and $114,000 in 2010 and 2009,
respectively, increased the annualized yield on loans by 0.51% from
6.05% and by 0.07% from 5.98% in 2010 and 2009,
respectively. |
(3) Represents the difference
between the yield on earning assets and cost of funds. |
(4) Represents net interest
income divided by average interest earning assets. |
|
|
|
|
December
31, |
Capital ratios: |
2010 |
2009 |
Tier 1 leverage |
7.9% |
7.3% |
Tier 1 capital to risk-weighted
assets |
10.9% |
8.9% |
Total regulatory capital to risk-weighted
assets |
12.2% |
10.2% |
Total equity to total assets |
8.12% |
7.76% |
|
|
|
Credit quality ratios: |
|
|
Allowance for loan losses to total
loans |
4.66% |
3.04% |
Nonperforming loans to total
loans |
4.72% |
4.18% |
Nonperforming assets to total assets |
5.09% |
4.52% |
CONTACT: Jack Zoeller,
Chairman and CEO, 804-763-1333
Bank OF Virginia (NASDAQ:BOVA)
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