Blue Valley Ban Corp. Announces Fourth Quarter 2016 Operating Results

OVERLAND PARK, Kan.--()--Blue Valley Ban Corp. (OTCQX: BVBC) (the “Company”) today reported consolidated earnings for the quarter and year-to-date periods ended December 31, 2016 of $134,000 and $1.6 million, respectively, compared to $92,000 and $665,000, respectively, for the comparable periods ended December 31, 2015. Earnings per common share for the quarter and year-to-date periods ending December 31, 2016 were $0.02 and $0.29, respectively, compared to net earnings (loss) per share of $0.02 and $(0.14), respectively, for the prior year quarter and year-to-date periods ending December 31, 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 December 31, 2016.

Robert D. Regnier, Chairman and CEO of Blue Valley Ban Corp., commented, “2016 was a year of notable progress in a number of respects, including loan growth, deposit growth, and improvements to asset quality and earnings. In addition, numerous factors, including but not limited to, the growth and improvement of the mix of our earning assets, more efficient deployment of our staffing, renegotiation of a significant third party service provider contract, as well as reductions to our cost of wholesale funding, provide a basis for improved returns. We continue to be encouraged by these accomplishments and remain committed to future growth and success.”

For the quarter ended December 31, 2016, net interest income increased $387,000 compared to the prior year period. For the year ended December 31, 2016, the Company’s net interest income increased $1.0 million compared to the prior year. For the quarter ended December 31, 2016, the Company’s non-interest income increased by $1.4 million, and increased by $1.0 million during the year ended December 31, 2016, compared to the prior year periods. For the quarter and year ended December 31, 2016, the Company’s non-interest expense increased by $908,000 and $120,000, respectively, compared to the prior year periods.

The Company recorded provisions to the allowance for loan losses during the quarter and year ended December 31, 2016 of $950,000 and $1.9 million, respectively, compared to provisions of $200,000 and $1.5 million, respectively, during the quarter and year ended December 31, 2015. Management evaluates credit risk on an ongoing basis to determine an appropriate level for the allowance for loan losses. Loan growth, net of the impact of improvement to the credit quality of the Company’s loan portfolio were the key factors for the determination of the level for the allowance for loan losses for the quarter ended December 31, 2016. The Company’s ratio of total reserves to non-accrual loans improved to approximately 1,020% as of December 31, 2016.

At December 31, 2016, the Bank’s ratio of non-accrual loans plus loans greater than 90 days past due to total loans for the Company’s subsidiary, Bank of Blue Valley (the “Bank”), was 0.12%, which compares favorably with the most recent Uniform Bank Performance Report peer group ratio of 0.82%.

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. In addition, the Company originates residential mortgages locally and nationwide through its InternetMortgage.com and bankbv.com websites.

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; a deterioration in the demand for mortgage financing; 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 Fixed Rate Cumulative Preferred Stock or Trust Preferred Securities; 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
December 31, 2016 and December 31, 2015
(In thousands, except share data)
 
ASSETS
    December 31, 2016     December 31, 2015

 

(Unaudited) (Unaudited)
 
Cash and due from banks $ 17,766 $ 22,178
Interest-bearing deposits in other financial institutions   8,272   23,655
Cash and cash equivalents 26,038 45,833
 
Available-for-sale securities 107,760 91,560
Mortgage loans held for sale, fair value 2,258
 

Loans, net of allowance for loan losses of $6,164 and $4,731 in 2016 and 2015, respectively

487,518 443,962
 
Premises and equipment, net 12,046 11,739
Bank-owned real estate held for sale, net 5,915 5,892
Foreclosed assets held for sale, net 5,883 9,644
Interest receivable 1,785 1,727
Deferred income taxes 14,304 12,902
Prepaid expenses and other assets 7,939 7,923

FHLBank stock, Federal Reserve Bank stock, and other securities

  5,244   4,805
 
Total assets $ 674,432 $ 638,245
 
 
Blue Valley Ban Corp.
Condensed Consolidated Balance Sheets
December 31, 2016 and December 31, 2015
(In thousands, except share data)
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
    December 31, 2016     December 31, 2015
(Unaudited) (Unaudited)
LIABILITIES
 
Deposits
Demand $ 150,274 $ 129,180
Savings, NOW and money market 280,628 251,765
Time   81,575     102,297  
Total deposits 512,477 483,242
 
Other interest-bearing liabilities 63,142 35,746
Long-term debt 53,333 72,786
Interest payable and other liabilities   2,045     1,745  
 
Total liabilities   630,997     593,519  
 
 
STOCKHOLDERS’ EQUITY
 
Capital stock

Series A Preferred stock, $1 par value, $1,000 liquidation preference; authorized 15,000,000 shares; issued and outstanding 2016 – 0 shares; 2015 – 0 shares

Series B 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 – 5,644,553 shares; 2015 – 5,371,353 shares

5,644 5,371
Additional paid-in capital 30,858 30,657
Retained earnings 9,842 8,276
Accumulated other comprehensive (loss), net of income tax credit of $2,254 in 2016 and $33 in 2015   (3,381 )   (50 )
 
Total stockholders’ equity   43,435     44,726  
 
Total liabilities and stockholders’ equity $ 674,432   $ 638,245  
 
 
Blue Valley Ban Corp.
Condensed Consolidated Statements of Operations
Three and Twelve Months Ended December 31, 2016 and 2015

(In thousands, except share data)

 
    Three Months Ended December 31,     Twelve Months Ended December 31,
2016     2015 2016     2015
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
INTEREST INCOME
Interest and fees on loans $ 5,419 $ 5,225 $ 20,949 $ 20,418
Federal funds sold and other short-term investments 35 30 185 89
Available-for-sale securities 542 439 1,938 1,880

Dividends on FHLBank and Federal Reserve Stock

  79   81     202   231  
Total interest income   6,075   5,775     23,274   22,618  
 
INTEREST EXPENSE
Interest-bearing demand deposits 73 62 239 246
Savings and money market deposit accounts 108 93 401 341
Other time deposits 130 230 609 868
Federal funds purchased and other interest-bearing liabilities 14 8 33 25
Long-term debt, net   536   555     2,307   2,470  
Total interest expense   861   948     3,589   3,950  
 
NET INTEREST INCOME 5,214 4,827 19,685 18,668
 
PROVISION FOR LOAN LOSSES   950   200     1,925   1,450  
 
NET INTEREST INCOME (LOSS) AFTER PROVISION FOR LOAN LOSSES   4,264   4,627     17,760   17,218  
 
NON-INTEREST INCOME
Loans held for sale fee income 145 95 879
Service fees 883 865 3,575 3,638
Realized gains (losses) on available-for-sale securities 953 (73 ) 1,879 (78 )
Other income   843   392     1,964   2,052  
Total non-interest income   2,679   1,329     7,513   6,491  
 
NON-INTEREST EXPENSE
Salaries and employee benefits 2,887 2,898 10,734 11,205
Net occupancy expense 683 576 2,720 2,699
Foreclosed assets expense 1,064 644 3,021 2,522
Other operating expense   2,108   1,716     6,413   6,342  
Total non-interest expense   6,742   5,834     22,888   22,768  
 
INCOME (LOSS) BEFORE INCOME TAXES 201 122 2,385 941
 
PROVISION (BENEFIT) FOR INCOME TAXES   67   30     819   276  
 
NET INCOME (LOSS)   134   92     1,566   665  
 
DIVIDENDS AND ACCRETION ON PREFERRED STOCK           1,333  
 

NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS

$ 134 $ 92   $ 1,566 $ (668 )
 
BASIC EARNINGS (LOSS) PER SHARE $ 0.02 $ 0.02   $ 0.29 $ (0.14 )
DILUTED EARNINGS (LOSS) PER SHARE $ 0.02 $ 0.02   $ 0.29 $ (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