Oak Valley Bancorp, the bank holding company for Oak Valley Community Bank and their Eastern Sierra Community Bank division, recently reported unaudited consolidated financial results. For the three months ended Dec. 31, 2019, consolidated net income was $3,191,000 or $0.39 per diluted share (EPS), as compared to $3,231,000, or $0.40 EPS, for the prior quarter and $2,979,000, or $0.37 EPS for the same period a year ago. Consolidated net income for the year ended Dec. 31, 2019 totaled $12,489,000, or $1.54 EPS, representing an increase of 8.3 percent compared to $11,537,000 or $1.42 EPS for 2018. The decrease from the prior quarter is due to net interest margin compression as a result of recent FOMC interest rate cuts during the third and fourth quarters of 2019, which negatively impacted yields on earning assets. The year-over-year net income increase was primarily driven by strong earning asset growth and corresponding increases to net interest income.
Net interest income was $10,350,000 and $41,034,000 for the fourth quarter and year ended Dec. 31, 2019, respectively, compared to $10,445,000 during the prior quarter, $10,179,000 for the fourth quarter of 2018 and $38,567,000 for the year ended Dec. 31, 2018. Net interest margin increased to 3.98 percent and 4.13 percent for the fourth quarter and year ended Dec. 31, 2019, respectively, as compared to 3.96 percent and 3.89 percent for the same periods of 2018. The net interest income and net interest margin increases over the comparable periods of the prior year were the result of strong loan growth. In addition, yields on earning assets increased slightly for 2019 as compared to 2018, as a result of the positive impact from interest rate increases during 2018, which were partially offset by rate cuts beginning in August 2019 when monetary policy shifted.
“Steady core deposit growth throughout the year and a robust second-half for loan production combined to elevate annual net income to a new all-time high. We are very happy with our 2019 results,” stated Chris Courtney, President and CEO of the Company and the Bank. “As we continue to instill a culture of client service, credit quality, and community in our employees, we are confident our team – working together – can execute our growth, service, and profitability goals in the prudent and deliberate manner we call the Oak Valley way.”
Non-interest income for the fourth quarter and year ended Dec. 31, 2019 totaled $1,254,000 and $5,046,000, respectively, compared to $1,275,000 during the prior quarter, $1,232,000 for the fourth quarter of 2018, and $4,712,000 for the year ended Dec. 31, 2018. The fourth quarter and year-to-date increases compared to 2018 were mainly due to earnings on new bank owned life insurance policies purchased in July 2019 and transaction fee income on bank debit cards related to the growth of the core deposit base and an overall shift towards electronic payment forms.
Total assets were $1.15 billion at Dec. 31, 2019, an increase of $46.4 million over Sept. 30, 2019 and $52.7 million over Dec. 31, 2018. Gross loans were $751.0 million as of Dec. 31, 2019, an increase of $18.7 million over Sept. 30, 2019 and an increase of $39.1 million over Dec. 31, 2018. The Company’s total deposits were $1.02 billion as of Dec. 31, 2019, an increase of $41.9 million over Sept. 30, 2019 and an increase of $33.4 million over Dec. 31, 2018.
The Board of Directors of Oak Valley Bancorp at their Jan. 21, 2020 meeting declared the payment of a cash dividend of $0.14 per share of common stock to its shareholders of record at the close of business on Feb. 3, 2020. The payment date will be Feb. 14, 2020 and will amount to approximately $1,149,000. This is the first dividend payment made by the Company in 2020.
Oak Valley Bancorp operates Oak Valley Community Bank and its Eastern Sierra Community Bank division, through which it offers a variety of loan and deposit products to individuals and small businesses. They currently operate through 17 branches: Oakdale, Turlock, Stockton, Patterson, Ripon, Escalon, Manteca, Tracy, Sacramento, two branches in Sonora, three branches in Modesto, and three branches in the Eastern Sierra division, which includes Bridgeport, Mammoth Lakes and Bishop.
For more information, call 1-866-844-7500 or visit www.ovcb.com.