Blue Valley Ban Corp. Announces Second Quarter 2016 Operating Results

OVERLAND PARK, Kan.--()--Blue Valley Ban Corp. (OTCQX: BVBC) (the “Company”) today reported consolidated net income for the quarter ended June 30, 2016 of $580,000, compared to a net loss of $(120,000) for the quarter ended June 30, 2015. For the six months ended June 30, 2016, the Company earned $870,000 compared to $489,000 for the six months ended June 30, 2015. Net income per common share for the quarter- and year-to-date periods ended June 30, 2016 was $0.11 and $0.16, respectively, compared to net loss of $(0.17) and $(0.14), respectively, for the quarter- and year-to-date periods ended June 30, 2015. Numerous key aspects of the operating results and financial condition for the Company reflected positive trends and results as of and during the period ended June 30, 2016.

Robert D. Regnier, Chairman and CEO of Blue Valley Ban Corp., commented, “The Company’s operating results for the second quarter and six-months ended June 30, 2016 continue to reflect the progress we have made to establish a foundation for growth and success. Growth in our loan portfolio was a primary contributory factor to an increase in net interest income. Additionally, the 2015 redemption of our Series A preferred stock has enabled improved stockholder returns compared to the three and six-month periods in the prior year. We are encouraged by these accomplishments and remain committed to future growth and success.”

Due to an increase in average loans and a reduction in the average rate paid on interest-bearing liabilities, the Company’s tax equivalent net interest income increased by $170,000, or 3.7%, during the quarter ended June 30, 2016, compared to the same period in 2015. Non-interest income increased by $376,000, or 24.6%, during the quarter ended June 30, 2016, compared to the same period in 2015, primarily due to realized gains on the sale of investment securities of $534,000 and an increase in other income which were partially offset by a decline in loans held for sale fee income. The decline in loans held for sale fee income resulted from the Company’s strategic decision to discontinue originating and selling residential mortgage loans to the secondary mortgage market beginning in 2016. The Company’s non-interest expense increased by $129,000, or 2.5%, for the quarter ended June 30, 2016 compared to the same period in the prior year as an increase in the Company’s foreclosed asset expense was partially offset by declines in salaries and employee benefit and other operating expenses.

The Company recorded a provision for loan loss of $500,000 for the quarter ended June 30, 2016, compared to a $1.25 million provision for the same period in the prior year. Management evaluates credit risk on an ongoing basis, and for the period ended June 30, 2016, determined that the recorded provision resulted in an appropriate level for the allowance for loan losses.

About Blue Valley Ban Corp.

Blue Valley Ban Corp. is a bank holding company that, through its subsidiaries, provides banking services to closely-held businesses, their owners, professionals and individuals in Johnson County, Kansas.

This release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and is including this statement for purposes of those safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies and expectations of the Company, can generally be identified by use of the words "anticipate," "believe," "can," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "should," or the negative of these terms or other comparable terminology. The Company is unable to predict the actual results of its future plans or strategies with certainty. Factors which could have a material adverse effect on the operations and future prospects of the Company include, but are not limited to, fluctuations in market rates of interest and loan and deposit pricing; inability to maintain or increase deposit base and secure adequate funding; a continued deterioration of general economic conditions or the demand for housing in the Company's market areas; legislative or regulatory changes; regulatory action; continued adverse developments in the Company's loan or investment portfolio; any inability to obtain funding on favorable terms; the Company’s non-payment on Trust Preferred Securities or other debt; the loss of key personnel; significant increases in competition; potential unfavorable actions from rating agencies; potential unfavorable results of litigation to which the Company may become a party, and the possible dilutive effect of potential acquisitions or expansions. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. We operate in a very competitive and rapidly changing environment. New risks emerge from time to time, and it is not possible for us to predict all risk factors. Nor can we address the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

 

Blue Valley Ban Corp.

Condensed Consolidated Balance Sheets

June 30, 2016 and December 31, 2015

(In thousands, except share data)

 
ASSETS
    June 30, 2016     December 31, 2015
(Unaudited)
 
Cash and due from banks $ 22,090 $ 22,178
Interest-bearing deposits in other financial institutions   33,637   23,655
Cash and cash equivalents 55,727 45,833
 
Available-for-sale securities 96,451 91,560
Mortgage loans held for sale, fair value 2,258
 

Loans, net of allowance for loan losses of $5,877 and $4,731
   in 2016 and 2015, respectively

441,345 443,962
 
Premises and equipment, net 11,599 11,739
Bank-owned real estate held for sale, net 5,892 5,892
Foreclosed assets held for sale, net 8,904 9,644
Interest receivable 1,546 1,727
Deferred income taxes 11,420 12,902
Prepaid expenses and other assets 7,674 7,923

FHLBank stock, Federal Reserve Bank stock,
   and other securities

  4,805   4,805
 
Total assets $ 645,363 $ 638,245
 
 

Blue Valley Ban Corp.

Condensed Consolidated Balance Sheets

June 30, 2016 and December 31, 2015

(In thousands, except share data)

 
LIABILITIES AND STOCKHOLDERS’ EQUITY
    June 30, 2016     December 31, 2015
(Unaudited)
LIABILITIES
 
Deposits
Demand $ 151,471 $ 129,180
Savings, NOW and money market 258,101 251,765
Time   85,082   102,297  
Total deposits 494,654 483,242
 
Other interest-bearing liabilities 28,675 35,746
Long-term debt 72,714 72,786
Interest payable and other liabilities   2,174   1,745  
 
Total liabilities   598,217   593,519  
 
 
STOCKHOLDERS’ EQUITY
 
Capital stock

Preferred stock, $1 par value, convertible to common stock;
  pari passu with common stock upon liquidation;
  authorized 1,000,000 shares; issued and outstanding
  2016 – 471,979 shares; 2015 – 471,979 shares

472 472

Common stock, par value $1 per share;
  authorized 15,000,000 shares; issued and outstanding
  2016 – 5,384,964 shares; 2015 – 5,371,353 shares

5,385 5,371
Additional paid-in capital 30,746 30,657
Retained earnings 9,146 8,276

Accumulated other comprehensive income (loss), net of income
  tax (credit) of $931 in 2016 and $(33) in 2015

  1,397   (50 )
 
Total stockholders’ equity   47,146   44,726  
 
Total liabilities and stockholders’ equity $ 645,363 $ 638,245  

       

Blue Valley Ban Corp.

Condensed Consolidated Statements of Operations

Three and Six Months Ended June 30, 2016 and 2015

(In thousands, except share data)

 

 

Three months ended

Six months ended
June 30, 2016     June 30, 2015 June 30, 2016     June 30, 2015
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
INTEREST INCOME
Interest and fees on loans $ 5,144 $ 5,041 $ 10,301 $ 9,930
Federal funds sold and other short-term investments 55 10 100 41
Available-for-sale securities 428 474 909 960

Dividends on FHLBank and Federal
  Reserve Stock

  81   100     102   122  
Total interest income   5,708   5,625     11,412   11,053  
 
INTEREST EXPENSE
Interest-bearing demand deposits 56 62 115 122
Savings and money market deposit accounts 96 81 191 160
Other time deposits 152 192 339 426
Federal funds purchased and other interest-bearing liabilities 6 6 12 11
Long-term debt, net   594   650     1,175   1,297  
Total interest expense   904   991     1,832   2,016  
 
NET INTEREST INCOME 4,804 4,634 9,580 9,037
 
PROVISION FOR LOAN LOSSES   500   1,250     975   1,250  
 

NET INTEREST INCOME (LOSS) AFTER
  PROVISION FOR LOAN LOSSES

  4,304   3,384     8,605   7,787  
 
NON-INTEREST INCOME
Loans held for sale fee income 261 95 524
Service fees 890 951 1,759 1,875
Realized gains (losses) on available-for-sale securities 534 (5 ) 534 (5 )
Other income   481   322     829   734  
Total non-interest income   1,905   1,529     3,217   3,128  
 
NON-INTEREST EXPENSE
Salaries and employee benefits 2,598 2,817 5,277 5,588
Net occupancy expense 654 669 1,299 1,331
Foreclosed assets expense 612 148 1,043 291
Other operating expense   1,396   1,497     2,815   2,988  
Total non-interest expense   5,260   5,131     10,434   10,198  
 
INCOME (LOSS) BEFORE INCOME TAXES 949 (218 ) 1,388 717
 
PROVISION (BENEFIT) FOR INCOME TAXES   369   (98 )   518   228  
 
NET INCOME (LOSS)   580   (120 )   870   489  
 
DIVIDENDS AND ACCRETION ON PREFERRED STOCK     648       1,137  
 

NET INCOME (LOSS) AVAILABLE TO
  COMMON STOCKHOLDERS

 

$ 580 $ (768 ) $ 870 $ (648 )
 
BASIC EARNINGS (LOSS) PER SHARE $ 0.11 $ (0.17 ) $ 0.16 $ (0.14 )
DILUTED EARNINGS (LOSS) PER SHARE $ 0.11 $ (0.17 ) $ 0.16 $ (0.14 )
 

Contacts

Blue Valley Ban Corp.
Mark A. Fortino, 913-338-1000
Chief Financial Officer

Contacts

Blue Valley Ban Corp.
Mark A. Fortino, 913-338-1000
Chief Financial Officer