UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934.
Date of Report: July 16, 2014
(Date of earliest event reported)
Oak Valley Bancorp
(Exact name of registrant as specified in its charter)
|
CA |
001-34142 |
26-2326676 |
| (State or other jurisdiction | (Commission File Number) | (IRS Employer |
| of incorporation) | Identification Number) | |
|
125 N. Third Ave. Oakdale, CA |
95361 |
|
| (Address of principal executive offices) | (Zip Code) |
(209) 848-2265
(Registrant's telephone number, including area code)
Not Applicable
(Former Name or Former Address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition
On July 16, 2014 Oak Valley Bancorp issued a press release, a copy of which is attached as Exhibit 99.1 and incorporated herein by reference. The press release announced the Company’s operating results for the quarter ended June 30, 2014.
The information in this Item 2.02 in this Form 8-K and the Exhibit 99.1 shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as shall be expressly set forth by specific reference in such filing.
Item 7.01. Regulation FD Disclosure.
See “Item 2.02. Results of Operations and Financial Condition” which is incorporated by reference in this Item 7.01.
Item 9.01. Financial Statements and Exhibits
(a) Financial statements:
None
(b) Pro forma financial information:
None
(c) Shell company transactions:
None
(d) Exhibits
|
|
99.1 |
Press Release of Oak Valley Bancorp dated July 16, 2014 |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated: July 17, 2014 | |||
|
OAK VALLEY BANCORP | |||
|
By: |
/s/ Richard A. McCarty |
||
|
Richard A. McCarty |
|||
|
Executive Vice President and Chief Financial Officer | |||
| (Principal Financial Officer and duly authorized signatory) | |||
|
Exhibit Index | |
|
Exhibit No. |
Description |
|
99.1 |
Press Release of Oak Valley Bancorp dated July 16, 2014 |
Exhibit 99.1
PRESS RELEASE
For Immediate Release
|
Date: |
July 16, 2014 |
|
Contact: |
Chris Courtney/Rick McCarty |
|
Phone: |
(209) 848-2265 |
www.ovcb.com
OAK VALLEY BANCORP REPORTS 2nd QUARTER RESULTS
OAKDALE, CA − 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) |
2nd Quarter |
1st Quarter |
4th Quarter |
3rd Quarter |
2nd Quarter |
|||||||||||||||
|
Selected Quarterly 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. |