GALLIPOLIS, Ohio, Jan. 26,
2023 /PRNewswire/ -- Ohio Valley Banc Corp.
[Nasdaq: OVBC] (the "Company") reported consolidated net income for
the quarter ended December 31, 2022,
of $3,524,000, an increase of
$1,220,000, or 53.0%, from the same
period the prior year. Earnings per share for the fourth quarter of
2022 were $.74 compared to
$.48 for the prior year fourth
quarter. For the year ended December 31,
2022, net income totaled $13,338,000, an increase of $1,606,000, or 13.7%, from the same period the
prior year. Earnings per share were $2.80 for 2022 versus $2.45 for 2021. Return on average assets and
return on average equity were 1.06% and 9.86%, respectively, for
the year ended December 31, 2022,
compared to .95% and 8.45%, respectively, for the same period in
the prior year.
Ohio Valley Banc Corp. President and CEO, Larry Miller stated, "2022 has seen record
inflation, ongoing interest rate hikes and economic uncertainty.
Yet, in spite of these and other challenges, I am pleased to report
your Company generated record net earnings during our 150th year of
business. These results would not have been possible without the
dedicated service of our employees, our loyal customers and the
support of our shareholders. They are what made 2022 the success
that it was, and for that, we offer a sincere thank you! As we turn
the page from our first 150 years in business, rest assured we
remain committed to our Community First mission and our vision to
remain an independent community bank."
For the fourth quarter of 2022, net interest income increased
$1,999,000, and for the year ended
December 31, 2022, net interest
income increased $3,765,000 from the
same respective periods last year. Contributing to the increase in
net interest income was the increase in the net interest margin and
the growth in average earning assets. In relation to the
significant increase in market interest rates during 2022 based on
actions taken by the Federal Reserve, the net interest margin has
responded positively due to the yield on earning assets increasing
more than the cost of interest-bearing liabilities. During 2022,
the quarterly net interest margin increased each quarter starting
at 3.51% for the first quarter and ending at 4.38% for the fourth
quarter. As a result of this positive trend, the current net
interest margin now exceeds the prior year. For the year ended
December 31, 2022, the net interest
margin was 3.89%, compared to 3.61% for the same period the prior
year. For the year ended December 31,
2022, average earning assets increased $15 million from the same period the prior year.
The increase was primarily due to average securities, which
increased $36 million from last year,
which was partially offset by a $23
million decrease in average balances maintained at the
Federal Reserve. The growth in average loans for 2022 was limited
to $3 million due to the repayment of
all SBA Paycheck Protection Program (PPP) loans as of the first
quarter of 2022. As a result of these repayments, the average
balance of PPP loans decreased $14
million and the corresponding interest and fees on PPP loans
decreased $1,225,000 for the year
ended December 31, 2022, as compared
to the same period last year.
For the three months ended December 31,
2022, the provision for loan losses was $659,000, an increase of $960,000 from the same period last year. The
provision expense for the fourth quarter of 2022 was primarily
related to an increase in the economic risk factors for the level
of classified and criticized loans and to quarter-to-date net
charge-offs of $201,000. For the year
ended December 31, 2022, the
provision for loan losses was negative $32,000, an increase of $387,000 from the same period last year. The
negative provision for loan loss expense experienced during 2022
was due to a decrease in certain economic risk factors, such as the
level of classified loans and the partial release of the COVID
reserve. These improvements contributed to lower general reserves,
which more than offset the year-to-date net charge-offs of
$1,182,000, of which $613,000 was related to a single loan
relationship. The allowance for loan losses was .60% of total loans
at December 31, 2022, compared to
.78% at December 31, 2021. The ratio
of nonperforming loans to total loans improved to .43% at
December 31, 2022, compared to .56%
at December 31, 2021.
For the three months ended December 31,
2022, noninterest income totaled $1,191,000, a decrease of $216,000 from the same period last year. The
decrease was due to the loss on the sale of securities, which
increased $471,000 from the same
period the prior year. During the fourth quarter of 2022, the
Company sold $12.5 million in
securities at a loss of $1,537,000.
The proceeds were reinvested into higher-yielding securities, which
are expected to increase future interest income. This same strategy
was executed during the fourth quarter of 2021, resulting in a loss
on sale of securities of $1,066,000.
For the year ended December 31, 2022,
noninterest income totaled $10,162,000, an increase of $298,000 from the same period last year. The
increase in year-to-date noninterest income was due to a
$579,000 increase in service charges
on deposit accounts and a $218,000
increase in interchange income on debit and credit card
transactions. These increases were partially offset by the
$471,000 increase in the loss on sale
of securities mentioned above.
For the three months ended December 31,
2022, noninterest expense totaled $8,882,000, a decrease of $445,000 from the same period last year. For the
year ended December 31, 2022,
noninterest expense totaled $39,040,000, an increase of $1,760,000 from the same period last year. The
Company's largest noninterest expense, salaries and employee
benefits, decreased $1,129,000 as
compared to the fourth quarter of 2021 and $34,000 as compared to the year ended
December 31, 2021. Contributing to
lower salaries and employee benefits was the reevaluation of
nonqualified benefit plan liabilities. Based on higher market
interest rates, the benefit plan liabilities were reduced, leading
to a lump sum decrease in benefit expense during the fourth
quarter. As a result, the expense associated with the nonqualified
benefit plans decreased $1,156,000
for the fourth quarter and $978,000
for the year-to-date period when compared to the same respective
periods the prior year. Partially offsetting the year-to-date
decrease in nonqualified benefit expense was an increase in salary
expense, which was primarily related to the staffing of Race Day
Mortgage and to annual merit increases.
Adding to higher noninterest expense for the year ended
December 31, 2022 were the categories
of marketing expense, data processing, software expense and other
noninterest expense. The increase in marketing expense was
primarily related to specific donations made during the fourth
quarter to support the communities that we serve and reflective of
our Community First mission. Marketing expense increased
$548,000 and $602,000 during the three and twelve months ended
December 31, 2022, compared to the
same periods in 2021, respectively. During the three and twelve
months ended December 31, 2022, data
processing expense increased $121,000
and $355,000 when compared to the
same respective periods in 2021. The increase was mostly related to
higher debit and credit card transaction volume. For the
three months and year ended December 31,
2022, software expense increased $66,000 and $339,000, respectively, from the same periods
last year. The increase was partly due to software platforms
utilized by Race Day Mortgage. The increase in year-to-date other
noninterest expense was mainly related to the expense associated
with purchasing mortgage loan marketing leads for Race Day Mortgage
for the full year of 2022. As a result, other noninterest expense
increased $315,000 for the year ended
December 31, 2022, compared to the
same period in 2021.
The Company's total assets at December
31, 2022 were $1.211 billion,
a decrease of $39 million from
December 31, 2021. During 2022, the
Company deployed a portion of the heightened cash balance into
higher yielding earning assets. Since December 31, 2021, loan balances increased
$54 million and securities increased
$6 million. These increases were
funded by a $106 million decrease in
cash and cash equivalents. A portion of the decrease in cash and
cash equivalents was also used to fund the decrease in total
deposits of $32 million, which
occurred within time deposits. A portion of the decrease in total
time deposits was related to wholesale time deposits decreasing
$15 million due to management not
targeting these funding sources throughout 2022. At December 31, 2022, shareholders' equity decreased
$6 million from year end 2021. The
decrease in shareholders' equity was related to recording the fair
value adjustment for securities classified as available-for-sale.
Based on the increase in market rates during 2022, the fair value
of securities decreased $16 million
on an after-tax basis. This decrease was partially offset by an
increase in retained earnings of $9
million.
Ohio Valley Banc Corp. common stock is traded on the NASDAQ
Global Market under the symbol OVBC. The holding company owns The
Ohio Valley Bank Company, with 17 offices in Ohio and West
Virginia; Loan Central, Inc. with six consumer finance
offices in Ohio; and Race Day
Mortgage, Inc., an online consumer direct mortgage company. Learn
more about Ohio Valley Banc Corp. at www.ovbc.com.
Caution Regarding Forward-Looking Information
Certain statements contained in this earnings release that are
not statements of historical fact constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Words such as "believes," "anticipates,"
"expects," "appears," "intends," "targeted" and similar expressions
are intended to identify forward-looking statements but are not the
exclusive means of identifying those statements.
Forward-looking statements involve risks and uncertainties.
Actual results may differ materially from those predicted by the
forward-looking statements because of various factors and possible
events, including: (i) impacts from the coronavirus (COVID-19)
pandemic on our business, operations, customers and capital
position; (ii) the impact of COVID-19 on local, national and global
economic conditions; unexpected changes in interest rates or
disruptions in the mortgage market related to COVID-19 or responses
to the health crisis; (iii) changes in political, economic or other
factors, such as inflation rates, recessionary or expansive trends,
taxes, the effects of implementation of federal legislation with
respect to taxes and government spending and the continuing
economic uncertainty in various parts of the world; (iv)
competitive pressures; (v) fluctuations in interest rates;
(vi) the level of defaults and prepayment on loans made by the
Company; (vii) unanticipated litigation, claims, or assessments;
(viii) fluctuations in the cost of obtaining funds to make loans;
(ix) regulatory changes; and (x) other factors that may be
described in the Company's Annual Reports on Form 10-K and
Quarterly Reports on Form 10-Q as filed with the Securities and
Exchange Commission from time to time. Forward-looking
statements speak only as of the date on which they are made, and
the Company undertakes no obligation to update any forward-looking
statement to reflect events or circumstances after the date on
which the statement is made to reflect unanticipated events.
OHIO VALLEY BANC
CORP - Financial Highlights (Unaudited)
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Three months
ended
|
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Twelve months
ended
|
|
|
|
December 31,
|
|
December 31,
|
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|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
PER SHARE
DATA
|
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|
Earnings per
share
|
|
|
$
0.74
|
|
$
0.48
|
|
$
2.80
|
|
$
2.45
|
Dividends per
share
|
|
|
$
0.21
|
|
$
0.21
|
|
$
0.99
|
|
$
0.84
|
Book value per
share
|
|
|
$
28.30
|
|
$
29.74
|
|
$
28.30
|
|
$
29.74
|
Dividend payout
ratio (a)
|
|
|
28.44 %
|
|
43.50 %
|
|
35.39 %
|
|
34.25 %
|
Weighted average
shares outstanding
|
4,771,774
|
|
4,763,881
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|
4,769,135
|
|
4,780,609
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|
|
|
|
|
|
|
|
|
|
DIVIDEND REINVESTMENT
(in 000's)
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|
Dividends
reinvested under
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|
|
employee stock ownership
plan (b)
|
$
-
|
|
$
-
|
|
$
154
|
|
$
188
|
Dividends
reinvested under
|
|
|
|
|
|
|
|
|
|
dividend reinvestment plan
(c)
|
|
|
$
531
|
|
$
433
|
|
$
2,272
|
|
$
1,721
|
|
|
|
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PERFORMANCE
RATIOS
|
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|
Return on
average equity
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|
|
10.81 %
|
|
6.48 %
|
|
9.86 %
|
|
8.45 %
|
Return on
average assets
|
|
|
1.14 %
|
|
0.73 %
|
|
1.06 %
|
|
0.95 %
|
Net interest
margin (d)
|
|
|
4.38 %
|
|
3.57 %
|
|
3.89 %
|
|
3.61 %
|
Efficiency ratio
(e)
|
|
|
64.76 %
|
|
78.26 %
|
|
70.44 %
|
|
72.59 %
|
Average earning
assets (in 000's)
|
|
$
1,135,547
|
|
$
1,167,458
|
|
$
1,163,999
|
|
$
1,148,909
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|
|
|
|
|
|
|
|
|
|
(a) Total dividends
paid as a percentage of net income.
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|
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|
(b) Shares may be
purchased from OVBC and on secondary market.
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|
(c) Shares may be
purchased from OVBC and on secondary market.
|
|
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|
|
(d) Fully
tax-equivalent net interest income as a percentage of average
earning assets.
|
|
|
|
(e) Noninterest expense
as a percentage of fully tax-equivalent net interest income plus
noninterest income.
|
|
|
OHIO VALLEY BANC
CORP - Consolidated Statements of Income (Unaudited)
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|
Three months
ended
|
|
Twelve months
ended
|
(in $000's)
|
|
|
December 31,
|
|
December 31,
|
|
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Interest
income:
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
|
$
11,471
|
|
$
10,453
|
|
$
42,273
|
|
$
42,102
|
Interest and dividends on
securities
|
|
1,044
|
|
655
|
|
3,850
|
|
2,446
|
Interest on interest-bearing
deposits with banks
|
691
|
|
53
|
|
1,493
|
|
164
|
Total interest income
|
|
|
13,206
|
|
11,161
|
|
47,616
|
|
44,712
|
Interest
expense:
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
600
|
|
603
|
|
2,130
|
|
2,977
|
Borrowings
|
|
|
216
|
|
167
|
|
708
|
|
722
|
Total interest expense
|
|
|
816
|
|
770
|
|
2,838
|
|
3,699
|
Net interest
income
|
|
|
12,390
|
|
10,391
|
|
44,778
|
|
41,013
|
Provision for
(recovery of) loan losses
|
659
|
|
(301)
|
|
(32)
|
|
(419)
|
Noninterest
income:
|
|
|
|
|
|
|
|
|
|
Service charges on deposit
accounts
|
628
|
|
555
|
|
2,443
|
|
1,864
|
Trust fees
|
|
|
78
|
|
73
|
|
325
|
|
285
|
Income from bank owned life
insurance and
|
|
|
|
|
|
|
|
annuity
assets
|
|
|
209
|
|
203
|
|
883
|
|
904
|
Mortgage banking
income
|
|
|
57
|
|
310
|
|
697
|
|
854
|
Electronic refund
check/deposit fees
|
0
|
|
0
|
|
675
|
|
675
|
Debit / credit card
interchange income
|
1,259
|
|
1,184
|
|
4,862
|
|
4,644
|
Loss on sale of
securities
|
|
|
(1,537)
|
|
(1,066)
|
|
(1,537)
|
|
(1,066)
|
Tax preparation
fees
|
|
|
2
|
|
2
|
|
743
|
|
754
|
Other
|
|
|
495
|
|
146
|
|
1,071
|
|
950
|
Total noninterest income
|
|
|
1,191
|
|
1,407
|
|
10,162
|
|
9,864
|
Noninterest
expense:
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
4,495
|
|
5,624
|
|
21,615
|
|
21,649
|
Occupancy
|
|
|
491
|
|
381
|
|
1,910
|
|
1,796
|
Furniture and
equipment
|
|
|
329
|
|
284
|
|
1,170
|
|
1,136
|
Professional fees
|
|
|
204
|
|
296
|
|
1,609
|
|
1,578
|
Marketing expense
|
|
|
710
|
|
162
|
|
1,428
|
|
826
|
FDIC
insurance
|
|
|
85
|
|
84
|
|
335
|
|
326
|
Data
processing
|
|
|
625
|
|
504
|
|
2,761
|
|
2,406
|
Software
|
|
|
577
|
|
511
|
|
2,197
|
|
1,858
|
Foreclosed assets
|
|
|
15
|
|
23
|
|
63
|
|
55
|
Amortization of
intangibles
|
|
|
7
|
|
10
|
|
35
|
|
48
|
Other
|
|
|
1,344
|
|
1,448
|
|
5,917
|
|
5,602
|
Total noninterest expense
|
|
|
8,882
|
|
9,327
|
|
39,040
|
|
37,280
|
Income before income
taxes
|
|
|
4,040
|
|
2,772
|
|
15,932
|
|
14,016
|
Income taxes
|
|
|
516
|
|
468
|
|
2,594
|
|
2,284
|
NET
INCOME
|
|
|
$
3,524
|
|
$
2,304
|
|
$
13,338
|
|
$
11,732
|
OHIO VALLEY BANC
CORP - Consolidated Balance Sheets (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in $000's, except
share data)
|
|
|
|
|
|
|
December 31,
|
|
December 31
|
|
|
|
|
|
|
|
2022
|
|
2021
|
ASSETS
|
|
|
|
|
|
|
|
|
|
Cash and
noninterest-bearing deposits with banks
|
|
|
|
|
$
14,330
|
|
$
14,111
|
Interest-bearing
deposits with banks
|
|
|
|
|
|
31,660
|
|
137,923
|
Total cash and cash
equivalents
|
|
|
|
|
|
45,990
|
|
152,034
|
Certificates of deposit
in financial institutions
|
|
|
|
|
1,862
|
|
2,329
|
Securities available
for sale
|
|
|
|
|
|
|
184,074
|
|
177,000
|
Securities held to
maturity (estimated fair value: 2022 - $8,460; 2021 -
$10,450)
|
|
9,226
|
|
10,294
|
Restricted investments
in bank stocks
|
|
|
|
|
|
5,953
|
|
7,265
|
Total
loans
|
|
|
|
|
|
|
885,049
|
|
831,191
|
Less:
Allowance for loan losses
|
|
|
|
|
|
(5,269)
|
|
(6,483)
|
Net loans
|
|
|
|
|
|
|
879,780
|
|
824,708
|
Premises and equipment,
net
|
|
|
|
|
|
|
20,436
|
|
20,730
|
Premises and equipment
held for sale, net
|
|
|
|
|
593
|
|
438
|
Accrued interest
receivable
|
|
|
|
|
|
|
3,112
|
|
2,695
|
Goodwill
|
|
|
|
|
|
|
7,319
|
|
7,319
|
Other intangible
assets, net
|
|
|
|
|
|
|
29
|
|
64
|
Bank owned life
insurance and annuity assets
|
|
|
|
|
39,627
|
|
37,281
|
Operating lease
right-of-use asset, net
|
|
|
|
|
1,294
|
|
1,195
|
Deferred tax
assets
|
|
|
|
|
|
|
6,022
|
|
2,217
|
Other assets
|
|
|
|
|
|
|
5,470
|
|
4,200
|
Total assets
|
|
|
|
|
|
|
$
1,210,787
|
|
$
1,249,769
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing
deposits
|
|
|
|
|
|
|
$ 354,413
|
|
$ 353,578
|
Interest-bearing
deposits
|
|
|
|
|
|
|
673,242
|
|
706,330
|
Total deposits
|
|
|
|
|
|
|
1,027,655
|
|
1,059,908
|
Other borrowed
funds
|
|
|
|
|
|
|
17,945
|
|
19,614
|
Subordinated
debentures
|
|
|
|
|
|
|
8,500
|
|
8,500
|
Operating lease
liability
|
|
|
|
|
|
|
1,294
|
|
1,195
|
Other
liabilities
|
|
|
|
|
|
|
20,365
|
|
19,196
|
Total liabilities
|
|
|
|
|
|
|
1,075,759
|
|
1,108,413
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
|
|
Common stock ($1.00
stated value per share, 10,000,000 shares authorized;
|
|
|
|
|
2022 - 5,465,707
shares issued; 2021 - 5,447,185 shares issued)
|
|
|
|
5,465
|
|
5,447
|
Additional paid-in
capital
|
|
|
|
|
|
|
51,722
|
|
51,165
|
Retained
earnings
|
|
|
|
|
|
|
109,320
|
|
100,702
|
Accumulated other
comprehensive income (loss)
|
|
|
|
|
(14,813)
|
|
708
|
Treasury stock, at cost
(693,933 shares)
|
|
|
|
|
(16,666)
|
|
(16,666)
|
Total shareholders' equity
|
|
|
|
|
|
|
135,028
|
|
141,356
|
Total liabilities and shareholders' equity
|
|
|
|
|
$
1,210,787
|
|
$
1,249,769
|
Contact: Scott Shockey, CFO
(740) 446-2631
View original
content:https://www.prnewswire.com/news-releases/ohio-valley-banc-corp-reports-4th-quarter-and-record-fiscal-year-earnings-301732060.html
SOURCE Ohio Valley Banc Corp.