MIDLOTHIAN, Va., July 22, 2008 (PRIME NEWSWIRE) -- Frank Bell, III, President and Chief Executive Officer of Bank of Virginia (Nasdaq:BOVA) (www.bankofva.com) announced the Bank's second quarter 2008 financial performance today. The Bank reported a profit of $56 thousand or $0.02 cents per basic and diluted earnings per share. The 2nd Quarter 2008 results compare favorably with the $89 thousand operating loss reported at March 31, 2008. In addition, total assets increased 6.4%, growing from $184.0 million at year-end 2007 to $195.7 million as of June 30, 2008.
Frank Bell said, "Bank of Virginia continues to grow given the current economic conditions we are facing. We are pleased that we have been able to improve our margin through the company's direction of aggressive deposit repricing, expense control and overall sound management of the loan portfolio."
The major component of the growth was the loan portfolio. Net loan balances (net of allowance for loan loss) increased from $130.8 million at December 31, 2007 to $142.9 million, which represents a 9.3% increase for the six-month period ending June 30, 2008.
Continuing into the second quarter 2008, the Bank experienced pressures from margins and expenses associated with operational growth, specifically from the new Patterson Avenue office. Frank Bell, President and Chief Executive Officer stated, "Although we are feeling the impact of the economy, our overall business continues to grow and our net interest margin continues to improve, which has led to improved results. With the current economic conditions showing no immediate signs of improvement, we continue to monitor our loan portfolio closely and place a strong emphasis on increasing core deposits. We also will continue to focus on monitoring operating expenses so we are able to continue to perform well."
For 12 months ending June 30, 2008, total assets increased 24.9% while liabilities increased 28.0%. As of June 30, 2008, total deposits were $158.9 million compared to year-end 2007 balances of $155.0 million. This represents a 2.5% increase for the year. Bank of Virginia is a commercial bank and the Bank's underlying portfolio of loans is diversified with various types of commercial loans. Consumer lending including first mortgage home lending is a very small component of the Bank's portfolio, and as a result, exposure to the mortgage industry has been kept to a minimum. While non-performing assets did increase at quarter-end to $441 thousand, the underlying collateral is in the process of being liquidated in the third quarter and the losses are expected to be minimal. The management team of the Bank remains very pleased that the company has continued to grow while maintaining good asset quality.
"Our customer base continues to grow and we are pleased what we have accomplished as a team. Although we are operating in difficult times we continue to perform well," Bell concluded.
The Bank currently operates five full-service offices in Chesterfield and Henrico Counties in Virginia. Bank of Virginia 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.
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-KSB 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
Statements of Operations
(Unaudited)
Three Months and Six Months and
Period Ended Period Ended
---------------------- ----------------------
June 30, June 30,
2008 2007 2008 2007
---------- ---------- ---------- ----------
Interest Income:
Interest and fees on
loans $2,492,291 $2,342,915 $5,022,232 $4,449,975
Investment securities 546,252 331,499 1,118,814 638,303
Interest on federal
funds sold and
deposits with banks 5,260 91,918 51,905 185,509
---------- ---------- ---------- ----------
Total interest
income 3,043,803 2,766,332 6,192,951 5,273,787
---------- ---------- ---------- ----------
Interest Expense:
Interest on deposits 1,587,608 1,447,216 3,356,887 2,745,844
Interest on fed funds
purchased and FHLB
borrowings 136,035 55,841 251,145 110,529
---------- ---------- ---------- ----------
Total interest
expense 1,723,643 1,503,057 3,608,032 2,856,373
---------- ---------- ---------- ----------
Net interest income 1,320,160 1,263,275 2,584,919 2,417,414
Provision for loan
losses 30,000 104,928 143,251 191,765
---------- ---------- ---------- ----------
Net interest income
after provision for
loan losses 1,290,160 1,158,347 2,441,668 2,225,649
---------- ---------- ---------- ----------
Non-interest Income:
Service charges on
deposit accounts 51,579 32,707 104,060 54,486
Net gain on available
for sale securities 68,568 -- 123,664 0
Other fee income 32,366 19,819 64,494 37,546
---------- ---------- ---------- ----------
Total non-interest
income 152,513 52,526 292,218 92,032
---------- ---------- ---------- ----------
Non-interest Expense:
Salaries and employee
benefits 778,051 675,893 1,551,230 1,260,669
Occupancy expense 105,203 88,946 204,676 164,761
Equipment expense 74,149 52,845 155,931 103,711
Data processing 105,371 83,614 202,337 165,543
Marketing expense 46,725 25,322 140,931 72,137
Legal and professional
fees 66,247 29,064 105,948 71,365
Other operating
expenses 210,448 136,287 405,367 255,638
---------- ---------- ---------- ----------
Total non-interest
expenses 1,386,194 1,091,971 2,766,420 2,093,824
---------- ---------- ---------- ----------
Net income (loss) $ 56,479 $ 118,902 $ (32,534) $ 223,857
========== ========== ========== ==========
Income (loss) per
share, basic and
diluted $ 0.02 $ 0.04 $ (0.01) $ 0.07
========== ========== ========== ==========
Weighted Average
Shares Outstanding:
Basic 3,031,866 3,031,866 3,031,866 3,031,866
========== ========== ========== ==========
Diluted 3,035,353 3,032,851 3,033,610 3,032,494
========== ========== ========== ==========
At period end:
Book value per share 5.66 5.66
Market value per
share 6.30 8.40
BANK OF VIRGINIA
Balance Sheets
June 30, December 31,
2008 2007
Unaudited Audited
------------ ------------
Assets
Cash and due from banks $ 2,758,391 $ 4,183,359
Federal funds sold and interest-bearing
balances with banks 3,990,008 4,771,376
------------ ------------
6,748,399 8,954,735
Securities available for sale, at fair
market value 39,046,579 37,641,272
Loans, net of allowance for loan losses
of $1,419,977 in 2008 and $1,276,726 in
2007 142,888,522 130,805,447
Premises and equipment, net 5,802,492 5,532,009
Accrued interest receivable 833,585 857,853
Other assets 377,214 217,311
------------ ------------
Total assets $195,696,791 $184,008,627
============ ============
Liabilities
Deposits:
Noninterest-bearing $ 13,705,569 $ 13,020,632
Savings and interest-bearing demand 16,320,273 17,122,793
Time, $100,000 and over 49,214,197 46,155,151
Other time 79,708,718 78,586,170
------------ ------------
Total deposits 158,948,757 154,884,746
Accrued expenses and other liabilities 1,088,789 1,119,459
FHLB borrowings and other indebtedness 18,505,000 10,000,000
------------ ------------
Total liabilities 178,542,546 166,004,205
------------ ------------
Stockholders' Equity
Preferred stock, $5 par value, 5,000,000
shares authorized, none issued -- --
Common stock, $2.50 par value, 40,000,000
shares authorized, 3,031,866 shares
issued and outstanding in 2007 and 2006,
respectively 7,579,665 7,579,665
Additional paid-in capital 14,699,300 14,693,218
Retained (deficit) (4,631,880) (4,599,346)
Accumulated other comprehensive (loss)
income (493,840) 330,885
------------ ------------
Total stockholders' equity 17,153,245 18,004,422
------------ ------------
Total liabilities and stockholders'
equity $195,695,791 $184,008,627
============ ============
BANK OF VIRGINIA
Selected Historical Information
(Unaudited)
June 30, March 31, Dec. 31, Sept. 30, June 30,
2008 2008 2007 2007 2007
--------- --------- --------- --------- ---------
Asset Quality
Analysis:
Allowance for
loan losses:
Beginning
balance 1,389,977 1,276,726 1,178,361 1,122,957 1,018,029
Provision 30,000 113,251 98,365 55,404 104,928
Charge-offs -- -- -- -- --
Recoveries -- -- -- -- --
--------- --------- --------- --------- ---------
Net charge-offs -- -- -- -- --
--------- --------- --------- --------- ---------
Ending
Balance 1,419,977 1,389,977 1,276,726 1,178,361 1,122,957
========= ========= ========= ========= =========
Nonperforming
Assets:
Nonaccrual loans -- -- -- -- --
Foreclosed real
estate 441,481 -- -- -- --
Repossessions -- -- -- -- --
Loans 90 days or
more past due
and still
accruing -- -- -- -- --
--------- --------- --------- --------- ---------
Nonperforming
assets 441,481 -- -- -- --
========= ========= ========= ========= =========
Allowance for
loan & lease
losses as a
percent of
loans 0.98% 0.97% 0.97% 0.96% 0.95%