Exhibit 99.1
PRESS RELEASE
For further information, contact:
David W. Pijor, Chairman and Chief Executive Officer
Phone: (703) 436-3802
Email: dpijor@fvcbank.com
Patricia A. Ferrick, President
Phone: (703) 436-3822
Email: pferrick@fvcbank.com
FOR IMMEDIATE RELEASE — October 18, 2018
FVCBankcorp, Inc. Announces 51% Increase in Third Quarter Net Income
Fairfax, VA-FVCBankcorp, Inc. (NASDAQ:FVCB) (the “Company”) today reported third quarter 2018 earnings increased 51% from a year ago to $3.4 million, or $0.27 diluted earnings per share, compared to $2.2 million, or $0.19 diluted earnings per share, for the quarterly period ended September 30, 2018. For the nine months ended September 30, 2018, earnings were $9.5 million, or $0.78 per diluted share, compared to $6.7 million, or $0.59 per diluted share, for the comparable nine month period of 2017. Net income for the three and nine months ended September 30, 2018 include merger-related expenses of $274 thousand and $671 thousand, respectively, associated with the Company’s acquisition of Colombo Bank. Excluding these merger-related expenses, net of tax, net income for the three and nine months ended September 30, 2018 would have been $3.6 million and $10.0 million, respectively. Diluted earnings per share excluding merger-related expenses, net of tax, for the three and nine months ended September 30, 2018 was $0.29 and $0.82, respectively. Results for the three and nine month periods ended September 30, 2018 reflect the new lower federal statutory tax rate.
Return on average assets was 1.18% and return on average equity was 12.23% for the third quarter of 2018. For the comparable September 30, 2017 period, return on average assets was 0.93% and return on average equity was 9.83%. Excluding merger-related expenses, net of tax, return on average assets and return on average equity for the three months ended September 30, 2018 was 1.27% and 13.13%, respectively. For the nine months ended September 30, 2018, return on average assets and return on average equity was 1.15% and 12.09%, respectively. Excluding merger-related expenses, net of tax, return on average assets and return on average equity for the nine months ended September 30, 2018 was 1.22% and 12.81%, respectively.
Selected Highlights
· During the third quarter, the Company completed a successful initial public offering issuing 1,750,000 shares of common stock raising $31.7 million after offering expenses. This capital raise added approximately 247,000 shares to the Company’s weighted average common shares outstanding, diluting earnings per share for the quarter by $0.01.
· Total loans, net of deferred fees, increased $151.2 million, or 18%, from September 30, 2017 to September 30, 2018. Asset quality remains strong with nonperforming loans and loans past due 90 days or more as a percentage of total assets being 0.17% at September 30, 2018, compared to 0.31% at September 30, 2017.
· Total deposits increased $147.1 million, or 17%, from September 30, 2017 to September 30, 2018. Excluding a decrease in wholesale deposits, deposits increased $182.1 million year-over-year, or 24%.
· Tangible book value per share at September 30, 2018 was $10.81, a 20% increase from $8.98 at September 30, 2017.
· Quarterly operating earnings, before taxes and merger-related expenses, increased 35% year-over-year.
· Efficiency ratio for the three months ended September 30, 2018 was 56.0%, and excluding merger-related expenses, was 53.4%.
“Third quarter 2018 earnings demonstrate our continued ability to attract new customer relationships as we completed our IPO and worked to complete our acquisition of Colombo Bank, which closed on October 12, 2018. Our customer centric business model allowed the bank to increase core deposits by 24% year-over-year and our loan portfolio by 18% year-over-year. We are delighted to welcome Colombo’s customers, shareholders, and employees to our bank. With the system conversion behind us, our business development team and 11 full-service branch offices are ready to continue our core growth strategy while providing our high-touch customer service to new and existing customers of FVCbank,” stated David W. Pijor, Chairman and CEO.
Balance Sheet
Total assets increased to $1.18 billion compared to $997.8 million as of September 30, 2018 and 2017, respectively, an increase of $177.7 million, or 18%. Loans receivable, net of deferred fees, totaled $978.3 million as of September 30, 2018, compared to $827.1 million as of September 30, 2017, a year-over-year increase of $151.2 million, or 18%.
Total deposits increased to $994.0 million as of September 30, 2018 compared to $846.9 million as of September 30, 2017, an increase of $147.1 million, or 17%. Noninterest-bearing deposits increased 18% to $211.8 million at September 30, 2018, or 21% of total deposits, compared to $179.0 million at September 30, 2017. Noninterest-bearing deposits at September 30, 2018 decreased $72.6 million from June 30, 2018 as customers moved deposits to interest-bearing deposit products. Core deposits, which include total deposits less wholesale deposits, increased $182.1 million or 24% year-over-year. Wholesale deposits totaled $50.6 million, or 5% of total deposits at September 30, 2018, a decrease of $64.9 million from December 31, 2017 and a decrease of $26.7 million from June 30, 2018. The Company’s increase in core deposits is a result of several promotions in addition to the Company’s success in adding new customer relationships.
Income Statement
Net interest income totaled $9.9 million, an increase of $1.7 million, or 21%, for the quarter ended September 30, 2018, compared to the year ago quarter. The Company’s net interest margin was 3.54% and 3.47% for the quarters ended September 30, 2018 and 2017, respectively. On a linked quarter basis, the margin increased 4 basis points from 3.50% for the three months ended June 30, 2018, a result of increases in yields on earning assets and strong growth in core deposit mix offset by an increase in the cost of funds.
Noninterest income totaled $748 thousand and $353 thousand for the quarters ended September 30, 2018 and 2017, respectively. Fee income from fees on loans, service charges on deposits, and other fee income was $638 thousand, an increase of 186% for the quarter ended September 30, 2018 compared to 2017. Included in loan income are fees from interest rate swaps totaling $395 thousand for the third quarter of 2018. The increase in deposit and other fee income is primarily due to initiatives the Company began during 2017 to enhance fee income through ancillary services designed to assist its clients’ financial needs.
Noninterest expense totaled $5.9 million for the quarter ended September 30, 2018, compared to $4.9 million for the same three-month period of 2017. The increase in noninterest expense year-over-year is primarily attributable to the Company strategically hiring business development officers and back office staff during 2017 to support the Company’s growth plans. As a result, salary and compensation related expenses increased $541 thousand, or 18%, for the quarter ended September 30, 2018, compared to the same three-month period of 2017. In addition, the Company recorded merger-related expenses of $274 thousand for the three months ended September 30, 2018 which contributed to the increase in noninterest expense for the quarter. Professional fees increased slightly year-over-year as a result of implementation costs related to regulatory compliance over the Company’s internal control environment. Increases in data processing and network administration, franchise taxes and other operating expenses for the quarter ended September 30, 2018 compared to the same three-month period of 2017 is primarily growth related. On a linked quarter basis, noninterest expense excluding merger-related expenses increased 5% from the three months ended June 30, 2018. The efficiency ratio for the quarter
ended September 30, 2018 was 56.0%, or 53.4% excluding merger-related expenses, a decrease from 57.1% from the year ago quarter.
Asset Quality
Asset quality remains strong as nonperforming loans and loans ninety days or more past due totaled $2.0 million, or 0.17% of total assets. Performing troubled debt restructurings (“TDR”) decreased to $267,000 at September 30, 2018, compared to $4.3 million at September 30, 2017. Nonperforming assets (including TDRs and other real estate owned) to total assets was 0.52% and 0.74% at September 30, 2018 and 2017, respectively. The allowance for loan losses to total loans was 0.88% at September 30, 2018, reflecting the Company’s continued sound credit quality and stable economic environment.
About FVCBankcorp Inc.
FVCBankcorp, Inc. is the holding company for FVCbank, a wholly-owned subsidiary of FVCB which commenced operations in November 2007. FVCbank is a $1.17 billion Virginia-chartered community bank serving the banking needs of commercial businesses, nonprofit organizations, professional service entities, their owners and employees located in the greater Washington, D.C., metropolitan and Northern Virginia area. Subsequent to September 30, 2018, FVCbank completed the acquisition of Colombo Bank, with approximately $188.7 million in assets. Locally owned and managed, FVCbank is based in Fairfax, Virginia, and now has 11 full-service offices in Arlington, Ashburn, Fairfax, Manassas, Reston and Springfield, Virginia, Washington D.C., and Baltimore Bethesda, Rockville and Silver Spring, Maryland.
For more information on the Company’s 2018 selected financial information, please visit the Investor Relations page of FVCBankcorp Inc.’s website, www.fvcbank.com.
Caution about Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited, statements of goals, intentions, and expectations as to future trends, plans, events or results of the Company’s operations and policies and regarding general economic conditions. In some cases, forward-looking statements can be identified by use of words such as “may,” “will,” “anticipates,” “believes,” “expects,” “plans,” “estimates,” “potential,” “continue,” “should,” and similar words or phrases. These statements are based upon current and anticipated economic conditions, nationally and in the Company’s market, interest rates and interest rate policy, competitive factors, and other conditions which by their nature, are not susceptible to accurate forecast and are subject to significant uncertainty. Because of these uncertainties and the assumptions on which this discussion and the forward-looking statements are based, actual future operations and results in the future may differ materially from those indicated herein. These forward-looking statements are based on current beliefs that involve significant risks, uncertainties, and assumptions. Factors that could cause the Company’s actual results to differ materially from those indicated in these forward-looking statements, include, but are not limited to, the risk factors previously disclosed in the “Risk Factors” section included in the Company’s prospectus filed with the Securities and Exchange Commission on September 17, 2018 pursuant to Rule 424(b)(4) under the Securities Act of 1933. Because of these uncertainties and the assumptions on which the forward-looking statements are based, actual operations and results in the future may differ materially from those indicated herein. Readers are cautioned against placing undue reliance on any such forward-looking statements. The Company’s past results are not necessarily indicative of future performance.
###
FVCBankcorp, Inc.
Selected Financial Data
(Dollars in thousands, except share data and per share data)
| | | | | | | | | | For the Three Months Ended , | |
| | For the Three Months Ended September 30, | | For the Nine Months Ended September 30, | | June 30, | | December 31, | |
| | (Unaudited) | | (Unaudited) | | (Unaudited) | |
| | 2018 | | 2017 | | 2018 | | 2017 | | 2018 | | 2017 | |
Selected Balances | | | | | | | | | | | | | |
Total assets | | $ | 1,175,437 | | $ | 997,756 | | | | | | $ | 1,139,449 | | $ | 1,053,224 | |
Total investment securities | | 116,931 | | 122,877 | | | | | | 122,644 | | 121,150 | |
Total loans, net of deferred fees | | 978,304 | | 827,101 | | | | | | 955,641 | | 888,677 | |
Allowance for loan losses | | (8,576 | ) | (7,271 | ) | | | | | (8,298 | ) | (7,725 | ) |
Total deposits | | 993,986 | | 846,854 | | | | | | 1,008,896 | | 928,163 | |
Subordinated debt | | 24,387 | | 24,307 | | | | | | 24,367 | | 24,327 | |
Other borrowings | | 15,000 | | 27,600 | | | | | | — | | — | |
Total stockholders’ equity | | 138,776 | | 97,545 | | | | | | 103,966 | | 98,283 | |
Summary Results of Operations | | | | | | | | | | | | | |
Interest income | | $ | 12,873 | | $ | 10,311 | | $ | 36,284 | | $ | 29,501 | | $ | 12,070 | | $ | 10,801 | |
Interest expense | | 2,995 | | 2,141 | | 8,287 | | 5,845 | | 2,714 | | 2,350 | |
Net interest income | | 9,878 | | 8,170 | | 27,997 | | 23,656 | | 9,356 | | 8,451 | |
Provision for loan losses | | 351 | | 250 | | 990 | | 765 | | 281 | | 435 | |
Net interest income after provision for loan losses | | 9,527 | | 7,920 | | 27,007 | | 22,891 | | 9,075 | | 8,016 | |
Noninterest income - loan fees, service charges and other | | 638 | | 223 | | 1,166 | | 630 | | 255 | | 252 | |
Noninterest income - bank owned life insurance | | 110 | | 115 | | 329 | | 740 | | 108 | | 114 | |
Noninterest income - gains on securities sold | | — | | 15 | | — | | 134 | | — | | 30 | |
Noninterest income - gains on foreclosure of other real estate owned | | — | | — | | — | | — | | — | | 1,076 | |
Noninterest expense | | 5,948 | | 4,861 | | 17,030 | | 14,424 | | 5,822 | | 4,925 | |
Income before taxes | | 4,327 | | 3,412 | | 11,472 | | 9,971 | | 3,616 | | 4,563 | |
Income tax expense | | 942 | | 1,177 | | 2,013 | | 3,287 | | 539 | | 3,558 | |
Net income | | 3,385 | | 2,235 | | 9,459 | | 6,684 | | 3,077 | | 1,005 | |
Per Share Data (2) | | | | | | | | | | | | | |
Net income, basic | | $ | 0.30 | | $ | 0.21 | | $ | 0.85 | | $ | 0.65 | | $ | 0.28 | | $ | 0.09 | |
Net income, diluted | | $ | 0.27 | | $ | 0.19 | | $ | 0.78 | | $ | 0.60 | | $ | 0.26 | | $ | 0.08 | |
Book value | | $ | 10.82 | | $ | 8.98 | | | | | | $ | 9.39 | | $ | 9.04 | |
Tangible Book value | | $ | 10.81 | | $ | 8.98 | | | | | | $ | 9.38 | | $ | 9.03 | |
Shares outstanding | | 12,831,040 | | 10,856,704 | | | | | | 11,076,266 | | 10,868,984 | |
Selected Ratios | | | | | | | | | | | | | |
Net interest margin (3) | | 3.54 | % | 3.46 | % | 3.48 | % | 3.44 | % | 3.50 | % | 3.43 | % |
Return on average assets (3) | | 1.18 | % | 0.93 | % | 1.15 | % | 0.95 | % | 1.13 | % | 0.40 | % |
Return on average equity (3) | | 12.23 | % | 9.83 | % | 12.09 | % | 10.40 | % | 12.02 | % | 4.06 | % |
Efficiency (1) | | 55.98 | % | 57.13 | % | 57.74 | % | 57.64 | % | 59.90 | % | 55.86 | % |
Loans, net of deferred fees, to total deposits | | 98.42 | % | 97.67 | % | | | | | 94.72 | % | 95.75 | % |
Noninterest-bearing deposits to total deposits | | 21.31 | % | 21.14 | % | | | | | 28.19 | % | 18.90 | % |
Reconciliation of Net Income (GAAP) to Operating Earnings (Non-GAAP) (4) | | | | | | | | | | | | | |
Net income (from above) | | $ | 3,385 | | $ | 2,235 | | $ | 9,459 | | $ | 6,684 | | $ | 3,077 | | $ | 1,005 | |
Add: Merger and acquisition expense | | 274 | | — | | 671 | | — | | 397 | | — | |
Subtract: provision for income taxes associated with merger and acquisition expense | | (24 | ) | — | | (107 | ) | — | | (83 | ) | — | |
NET INCOME, excluding above merger and acquisition charges | | $ | 3,635 | | $ | 2,235 | | $ | 10,023 | | $ | 6,684 | | $ | 3,391 | | $ | 1,005 | |
Net income, diluted, on an operating basis | | $ | 0.29 | | $ | 0.19 | | $ | 0.82 | | $ | 0.60 | | $ | 0.28 | | $ | 0.08 | |
Return on average assets (non-GAAP operating earnings) | | 1.27 | % | 0.93 | % | 1.22 | % | 0.95 | % | 1.24 | % | 0.40 | % |
Return on average equity (non-GAAP operating earnings) | | 13.13 | % | 9.83 | % | 12.81 | % | 10.40 | % | 13.25 | % | 4.06 | % |
Capital Ratios - Bank | | | | | | | | | | | | | |
Tangible common equity (to tangible assets) | | 11.80 | % | 9.77 | % | | | | | 9.12 | % | 9.33 | % |
Total capital (to risk weighted assets) | | 13.88 | % | 13.68 | % | | | | | 12.77 | % | 12.83 | % |
Common equity tier 1 capital (to risk weighted assets) | | 13.08 | % | 12.89 | % | | | | | 11.98 | % | 12.05 | % |
Tier 1 capital (to risk weighted assets) | | 13.08 | % | 12.89 | % | | | | | 11.98 | % | 12.05 | % |
Tier 1 leverage (to average assets) | | 12.32 | % | 12.22 | % | | | | | 11.58 | % | 11.79 | % |
Asset Quality | | | | | | | | | | | | | |
Nonperforming loans and loans 90+ past due | | $ | 2,021 | | $ | 3,079 | | | | | | $ | 938 | | $ | 789 | |
Performing troubled debt restructurings (TDRs) | | 267 | | 4,348 | | | | | | 1,600 | | 1,657 | |
Other real estate owned | | 3,866 | | — | | | | | | 3,866 | | 3,866 | |
Nonperforming loans and loans 90+ past due to total assets (excl. TDRs) | | 0.17 | % | 0.31 | % | | | | | 0.08 | % | 0.07 | % |
Nonperforming assets to total assets | | 0.50 | % | 0.31 | % | | | | | 0.42 | % | 0.44 | % |
Nonperforming assets (including TDRs) to total assets | | 0.52 | % | 0.74 | % | | | | | 0.56 | % | 0.58 | % |
Allowance for loan losses to loans | | 0.88 | % | 0.88 | % | | | | | 0.87 | % | 0.87 | % |
Allowance for loan losses to nonperforming loans | | 424.34 | % | 236.15 | % | | | | | 884.65 | % | 979.09 | % |
Net charge-offs (recovery) | | $ | 73 | | $ | (9 | ) | $ | 139 | | $ | (54 | ) | $ | 85 | | $ | (19 | ) |
Net charge-offs (recovery) to average loans (3) | | 0.03 | % | (0.00 | )% | 0.01 | % | (0.01 | )% | 0.04 | % | (0.01 | )% |
Selected Average Balances | | | | | | | | | | | | | |
Total assets | | $ | 1,142,642 | | $ | 964,418 | | $ | 1,097,667 | | $ | 936,624 | | $ | 1,092,950 | | $ | 1,013,070 | |
Total earning assets | | 1,116,154 | | 943,979 | | 1,073,175 | | 917,677 | | 1,069,035 | | 986,648 | |
Total loans, net of deferred fees | | 959,992 | | 811,901 | | 928,190 | | 789,704 | | 930,133 | | 851,123 | |
Total deposits | | 1,002,079 | | 838,328 | | 960,964 | | 805,406 | | 958,304 | | 878,482 | |
Other Data | | | | | | | | | | | | | |
Noninterest-bearing deposits | | $ | 211,808 | | $ | 178,989 | | | | | | $ | 284,452 | | $ | 175,446 | |
Interest-bearing checking, savings and money market | | 485,319 | | 349,804 | | | | | | 396,667 | | 379,101 | |
Time deposits | | 246,272 | | 232,526 | | | | | | 250,492 | | 258,127 | |
Wholesale deposits | | 50,587 | | 85,535 | | | | | | 77,285 | | 115,489 | |
(1) Efficiency ratio is calculated as noninterest expense divided by the sum of net interest income and noninterest income, excluding gains on sales of investment securities and other real estate owned.
(2) All per share data calculations have been retroactively adjusted for the five-for-four stock split declared September 2017.
(3) Annualized.
(4) Some of the financial measures discussed throughout the press release are “non-GAAP financial measures.” In accordance with SEC rules, the Company classifies a financial measure as being a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, that are included or excluded, as the case may be, in the most directly comparable measure calculated and presented in accordance with GAAP in our statements of income, balance sheets or statements of cash flows.
FVCBankcorp, Inc.
Summary Consolidated Statements of Condition
(Dollars in thousands)
(Unaudited)
| | | | | | % Change | | | | | | % Change | |
| | | | | | Current | | | | | | From | |
| | 9/30/2018 | | 6/30/2018 | | Quarter | | 12/31/2017 | | 9/30/2017 | | Year Ago | |
| | | | | | | | | | | | | |
Cash and due from banks | | $ | 8,939 | | $ | 6,309 | | 41.7 | % | $ | 7,428 | | $ | 7,144 | | 25.1 | % |
Interest-bearing deposits at other financial institutions | | 46,396 | | 30,734 | | 51.0 | % | 15,139 | | 22,126 | | 109.7 | % |
Investment securities | | 113,131 | | 118,844 | | -4.8 | % | 117,712 | | 118,270 | | -4.3 | % |
Restricted stock, at cost | | 3,800 | | 3,800 | | 0.0 | % | 3,438 | | 4,607 | | -17.5 | % |
| | | | | | | | | | | | | |
Loans, net of fees: | | | | | | | | | | | | | |
Commercial real estate | | 592,083 | | 572,039 | | 3.5 | % | 526,065 | | 516,787 | | 14.6 | % |
Commercial and industrial | | 108,331 | | 110,359 | | -1.8 | % | 98,150 | | 89,267 | | 21.4 | % |
Commercial construction | | 144,140 | | 138,973 | | 3.7 | % | 123,444 | | 100,583 | | 43.3 | % |
Consumer residential | | 107,207 | | 106,747 | | 0.4 | % | 108,786 | | 104,259 | | 2.8 | % |
Consumer nonresidential | | 26,543 | | 27,523 | | -3.6 | % | 32,232 | | 16,205 | | 63.8 | % |
Total loans, net of fees | | 978,304 | | 955,641 | | 2.4 | % | 888,677 | | 827,101 | | 18.3 | % |
Allowance for loan losses | | (8,576 | ) | (8,298 | ) | 3.4 | % | (7,725 | ) | (7,271 | ) | 17.9 | % |
Loans, net | | 969,728 | | 947,343 | | 2.4 | % | 880,952 | | 819,830 | | 18.3 | % |
| | | | | | | | | | | | | |
Premises and equipment, net | | 1,420 | | 1,401 | | 1.4 | % | 1,236 | | 1,254 | | 13.2 | % |
Bank owned life insurance (BOLI) | | 16,297 | | 16,187 | | 0.7 | % | 15,969 | | 15,854 | | 2.8 | % |
Other real estate owned | | 3,866 | | 3,866 | | 0.0 | % | 3,866 | | — | | 100.0 | % |
Other assets | | 11,860 | | 10,965 | | 8.2 | % | 7,484 | | 8,671 | | 36.8 | % |
| | | | | | | | | | | | | |
Total Assets | | $ | 1,175,437 | | $ | 1,139,449 | | 3.2 | % | $ | 1,053,224 | | $ | 997,756 | | 17.8 | % |
| | | | | | | | | | | | | |
Deposits: | | | | | | | | | | | | | |
Noninterest-bearing | | $ | 211,808 | | $ | 284,452 | | -25.5 | % | $ | 175,446 | | $ | 178,989 | | 18.3 | % |
Interest-bearing checking | | 276,197 | | 222,522 | | 24.1 | % | 185,528 | | 182,458 | | 51.4 | % |
Savings and money market | | 209,122 | | 174,145 | | 20.1 | % | 193,573 | | 167,346 | | 25.0 | % |
Time deposits | | 246,272 | | 250,492 | | -1.7 | % | 258,127 | | 232,526 | | 5.9 | % |
Wholesale deposits | | 50,587 | | 77,285 | | -34.5 | % | 115,489 | | 85,535 | | -40.9 | % |
Total deposits | | 993,986 | | 1,008,896 | | -1.5 | % | 928,163 | | 846,854 | | 17.4 | % |
| | | | | | | | | | | | | |
Other borrowed funds | | 15,000 | | — | | 100.0 | % | — | | 27,600 | | -45.7 | % |
Subordinated notes, net of issuance costs | | 24,387 | | 24,367 | | 0.1 | % | 24,327 | | 24,307 | | 0.3 | % |
Other liabilities | | 3,288 | | 2,220 | | 48.1 | % | 2,451 | | 1,450 | | 126.8 | % |
| | | | | | | | | | | | | |
Stockholders’ equity | | 138,776 | | 103,966 | | 33.5 | % | 98,283 | | 97,545 | | 42.3 | % |
| | | | | | | | | | | | | |
Total Liabilities & Stockholders’ Equity | | $ | 1,175,437 | | $ | 1,139,449 | | 3.2 | % | $ | 1,053,224 | | $ | 997,756 | | 17.8 | % |
FVCBankcorp, Inc.
Summary Consolidated Income Statements
(In thousands, except per share data)
(Unaudited)
| | For the Three Months Ended | |
| | | | | | % Change | | | | % Change | |
| | | | | | Current | | | | From | |
| | 9/30/2018 | | 6/30/2018 | | Quarter | | 9/30/2017 | | Year Ago | |
| | | | | | | | | | | |
Net interest income | | $ | 9,878 | | $ | 9,356 | | 5.6 | % | $ | 8,170 | | 20.9 | % |
Provision for loan losses | | 351 | | 281 | | 24.9 | % | 250 | | 40.4 | % |
Net interest income after provision for loan losses | | 9,527 | | 9,075 | | 5.0 | % | 7,920 | | 20.3 | % |
| | | | | | | | | | | |
Noninterest income: | | | | | | | | | | | |
Fees on Loans | | 411 | | 4 | | 10,175.0 | % | 19 | | 2,063.2 | % |
Service charges on deposit accounts | | 158 | | 152 | | 3.9 | % | 146 | | 8.2 | % |
Gains on sale of securities available-for-sale | | — | | — | | 0.0 | % | 15 | | -100.0 | % |
BOLI income | | 110 | | 108 | | 1.9 | % | 115 | | -4.3 | % |
Other fee income | | 69 | | 99 | | -30.3 | % | 58 | | 19.0 | % |
Total noninterest income | | 748 | | 363 | | 106.1 | % | 353 | | 111.9 | % |
| | | | | | | | | | | |
Noninterest expense: | | | | | | | | | | | |
Salaries and employee benefits | | 3,491 | | 3,324 | | 5.0 | % | 2,950 | | 18.3 | % |
Occupancy and equipment expense | | 591 | | 580 | | 1.9 | % | 559 | | 5.7 | % |
Data processing and network administration | | 321 | | 285 | | 12.6 | % | 275 | | 16.7 | % |
State franchise taxes | | 296 | | 296 | | 0.0 | % | 252 | | 17.5 | % |
Professional fees | | 147 | | 132 | | 11.4 | % | 123 | | 19.5 | % |
Merger and acquisition expense | | 274 | | 397 | | -31.0 | % | — | | 100.0 | % |
Other operating expense | | 828 | | 808 | | 2.5 | % | 702 | | 17.9 | % |
Total non-interest expense | | 5,948 | | 5,822 | | 2.2 | % | 4,861 | | 22.4 | % |
Net income before income taxes | | 4,327 | | 3,616 | | 19.7 | % | 3,412 | | 26.8 | % |
Income tax expense | | 942 | | 539 | | 74.8 | % | 1,177 | | -20.0 | % |
Net Income | | $ | 3,385 | | $ | 3,077 | | 10.0 | % | $ | 2,235 | | 51.5 | % |
| | | | | | | | | | | |
Earnings per share - basic | | $ | 0.30 | | $ | 0.28 | | 10.7 | % | $ | 0.21 | | 42.9 | % |
Earnings per share - diluted | | $ | 0.27 | | $ | 0.26 | | 11.5 | % | $ | 0.19 | | 42.1 | % |
Weighted-average common shares outstanding - basic | | 11,324,965 | | 11,023,775 | | 2.7 | % | 10,479,282 | | 8.1 | % |
Weighted-average common shares outstanding - diluted | | 12,470,384 | | 12,063,423 | | 3.4 | % | 11,584,218 | | 7.6 | % |
| | | | | | | | | | | |
Reconciliation of Net Income (GAAP) to Operating Earnings (Non-GAAP): | | | | | | | | | | | |
GAAP net income reported above | | $ | 3,385 | | $ | 3,077 | | | | | | | |
Add: Merger and acquisition expense above | | 274 | | 397 | | | | | | | |
Subtract: provision for income taxes associated with merger and acquisition expense | | (24 | ) | (83 | ) | | | | | | |
NET INCOME, excluding above merger and acquisition charges | | $ | 3,635 | | $ | 3,391 | | | | | | | |
Earnings per share - basic (excluding merger and acquisition charges) | | $ | 0.32 | | $ | 0.31 | | | | | | | |
Earnings per share - diluted (excluding merger and acquisition charges) | | $ | 0.29 | | $ | 0.28 | | | | | | | |
| | | | | | | | | | | |
Return on average assets (non-GAAP operating earnings) | | 1.27 | % | 1.24 | % | | | | | | |
Return on average equity (non-GAAP operating earnings) | | 13.13 | % | 13.23 | % | | | | | | |
Efficiency ratio (non-GAAP operating earnings) | | 53.40 | % | 55.82 | % | | | | | | |
FVCBankcorp, Inc.
Summary Consolidated Income Statements
(In thousands, except per share data)
(Unaudited)
| | For the Nine Months Ended | |
| | | | | | % Change | |
| | | | | | From | |
| | 9/30/2018 | | 9/30/2017 | | Year Ago | |
| | | | | | | |
Net interest income | | $ | 27,997 | | $ | 23,656 | | 18.4 | % |
Provision for loan losses | | 990 | | 765 | | 29.4 | % |
Net interest income after provision for loan losses | | 27,007 | | 22,891 | | 18.0 | % |
| | | | | | | |
Noninterest income: | | | | | | | |
Fees on Loans | | 473 | | 46 | | 928.3 | % |
Service charges on deposit accounts | | 452 | | 402 | | 12.4 | % |
Gains on sale of securities available-for-sale | | — | | 134 | | -100.0 | % |
BOLI income | | 329 | | 740 | | -55.5 | % |
Other fee income | | 241 | | 182 | | 32.4 | % |
Total noninterest income | | 1,495 | | 1,504 | | -0.6 | % |
| | | | | | | |
Noninterest expense: | | | | | | | |
Salaries and employee benefits | | 10,000 | | 8,798 | | 13.7 | % |
Occupancy and equipment expense | | 1,743 | | 1,672 | | 4.2 | % |
Data processing and network administration | | 886 | | 772 | | 14.8 | % |
State franchise taxes | | 888 | | 787 | | 12.8 | % |
Professional fees | | 434 | | 352 | | 23.3 | % |
Merger and acquisition expense | | 671 | | — | | 100.0 | % |
Other operating expense | | 2,408 | | 2,043 | | 17.9 | % |
Total non-interest expense | | 17,030 | | 14,424 | | 18.1 | % |
Net income before income taxes | | 11,472 | | 9,971 | | 15.1 | % |
Income tax expense | | 2,013 | | 3,287 | | -38.8 | % |
Net income | | $ | 9,459 | | $ | 6,684 | | 41.5 | % |
| | | | | | | |
Earnings per share - basic | | $ | 0.85 | | $ | 0.65 | | 30.8 | % |
Earnings per share - diluted | | $ | 0.78 | | $ | 0.60 | | 30.0 | % |
Weighted-average common shares outstanding - basic | | 11,094,353 | | 10,288,055 | | 7.8 | % |
Weighted-average common shares outstanding - diluted | | 12,195,620 | | 11,231,897 | | 8.6 | % |
| | | | | | | |
Reconciliation of Net Income (GAAP) to Operating Earnings (Non-GAAP): | | | | | |
GAAP net income reported above | | $ | 9,459 | | | | | |
Add: Merger and acquisition expense above | | 671 | | | | | |
Subtract: provision for income taxes associated with merger and acquisition expense | | (107 | ) | | | | |
NET INCOME, excluding above merger and acquisition charges | | $ | 10,023 | | | | | |
Earnings per share - basic (excluding merger and acquisition charges) | | $ | 0.90 | | | | | |
Earnings per share - diluted (excluding merger and acquisition charges) | | $ | 0.82 | | | | | |
| | | | | | | |
Return on average assets (non-GAAP operating earnings) | | 1.22 | % | | | | |
Return on average equity (non-GAAP operating earnings) | | 12.81 | % | | | | |
Efficiency ratio (non-GAAP operating earnings) | | 55.47 | % | | | | |
FVCBankcorp, Inc.
Average Statements of Condition and Yields on Earning Assets and Interest-Bearing Liabilities
(Dollars in thousands)
(Unaudited)
| | For the Three Months Ended | |
| | 9/30/2018 | | 6/30/2018 | | 9/30/2017 | |
| | Average | | Average | | Average | | Average | | Average | | Average | |
| | Balance | | Yield | | Balance | | Yield | | Balance | | Yield | |
Interest-earning assets: | | | | | | | | | | | | | |
Loans receivable, net of fees (1) | | | | | | | | | | | | | |
Commercial real estate | | $ | 575,738 | | 4.72 | % | $ | 564,251 | | 4.59 | % | $ | 514,043 | | 4.73 | % |
Commercial and industrial | | 110,241 | | 5.81 | % | 105,175 | | 5.65 | % | 85,915 | | 5.14 | % |
Commercial construction | | 140,213 | | 5.39 | % | 123,262 | | 5.32 | % | 91,445 | | 4.87 | % |
Consumer residential | | 106,922 | | 4.72 | % | 108,451 | | 4.51 | % | 103,876 | | 4.44 | % |
Consumer nonresidential | | 26,878 | | 6.50 | % | 28,994 | | 6.40 | % | 16,622 | | 3.94 | % |
Total loans | | 959,992 | | 4.99 | % | 930,133 | | 4.86 | % | 811,901 | | 4.73 | % |
| | | | | | | | | | | | | |
Investment securities (2)(3) | | 120,174 | | 2.45 | % | 123,488 | | 2.43 | % | 119,301 | | 2.31 | % |
Interest-bearing deposits at other financial institutions | | 35,988 | | 1.82 | % | 15,414 | | 0.83 | % | 12,777 | | 0.71 | % |
Total interest-earning assets | | 1,116,154 | | 4.62 | % | 1,069,035 | | 4.52 | % | 943,979 | | 4.37 | % |
| | | | | | | | | | | | | |
Non-interest earning assets: | | | | | | | | | | | | | |
Cash and due from banks | | 2,386 | | | | 2,348 | | | | 1,937 | | | |
Premises and equipment, net | | 1,416 | | | | 1,394 | | | | 1,337 | | | |
Accrued interest and other assets | | 31,107 | | | | 28,361 | | | | 24,290 | | | |
Allowance for loan losses | | (8,421 | ) | | | (8,188 | ) | | | (7,125 | ) | | |
| | | | | | | | | | | | | |
Total Assets | | $ | 1,142,642 | | | | $ | 1,092,950 | | | | $ | 964,418 | | | |
| | | | | | | | | | | | | |
Interest-bearing liabilities: | | | | | | | | | | | | | |
Interest checking | | $ | 251,299 | | 1.10 | % | $ | 195,130 | | 1.00 | % | $ | 195,721 | | 0.85 | % |
Savings and money market | | 190,176 | | 1.18 | % | 194,327 | | 1.03 | % | 157,448 | | 0.76 | % |
Time deposits | | 249,508 | | 1.62 | % | 249,664 | | 1.47 | % | 228,588 | | 1.34 | % |
Wholesale deposits | | 65,354 | | 1.84 | % | 91,028 | | 1.70 | % | 81,465 | | 1.09 | % |
Total interest-bearing deposits | | 756,337 | | 1.36 | % | 730,149 | | 1.26 | % | 663,222 | | 1.03 | % |
| | | | | | | | | | | | | |
Other borrowed funds | | 2,799 | | 2.25 | % | 6,627 | | 2.00 | % | 8,083 | | 1.43 | % |
Subordinated notes, net of issuance costs | | 24,374 | | 6.43 | % | 24,354 | | 6.51 | % | 24,294 | | 6.45 | % |
Total interest-bearing liabilities | | 783,510 | | 1.52 | % | 761,130 | | 1.43 | % | 695,599 | | 1.23 | % |
| | | | | | | | | | | | | |
Noninterest-bearing liabilities: | | | | | | | | | | | | | |
Noninterest-bearing deposits | | 245,742 | | | | 228,155 | | | | 175,106 | | | |
Other liabilities | | 2,662 | | | | 1,132 | | | | 2,765 | | | |
| | | | | | | | | | | | | |
Stockholders’ equity | | 110,728 | | | | 102,533 | | | | 90,948 | | | |
| | | | | | | | | | | | | |
Total Liabilities and Stockholders’ Equity | | $ | 1,142,642 | | | | $ | 1,092,950 | | | | $ | 964,418 | | | |
| | | | | | | | | | | | | |
Net Interest Margin (2) | | | | 3.54 | % | | | 3.50 | % | | | 3.46 | % |
(1) Non-accrual loans are included in average balances.
(2) The average yields for investment securities are reported on a fully taxable-equivalent basis at a rate of 21% for 2018 and 34.5% for 2017.
(3) The average balances for investment securities includes restricted stock.
FVCBankcorp, Inc.
Average Statements of Condition and Yields on Earning Assets and Interest-Bearing Liabilities
(Dollars in thousands)
(Unaudited)
| | For the Nine Months Ended | |
| | 9/30/2018 | | 9/30/2017 | |
| | Average | | Average | | Average | | Average | |
| | Balance | | Yield | | Balance | | Yield | |
Interest-earning assets: | | | | | | | | | |
Loans receivable, net of fees (1) | | | | | | | | | |
Commercial real estate | | $ | 559,578 | | 4.65 | % | $ | 493,392 | | 4.65 | % |
Commercial and industrial | | 103,395 | | 5.55 | % | 92,127 | | 4.89 | % |
Commercial construction | | 128,618 | | 5.19 | % | 81,382 | | 4.97 | % |
Consumer residential | | 108,056 | | 4.52 | % | 105,219 | | 4.22 | % |
Consumer nonresidential | | 28,543 | | 6.37 | % | 17,584 | | 3.82 | % |
Total loans | | 928,190 | | 4.86 | % | 789,704 | | 4.63 | % |
| | | | | | | | | |
Investment securities (2)(3) | | 122,164 | | 2.42 | % | 116,267 | | 2.34 | % |
Interest-bearing deposits at other financial institutions | | 22,821 | | 1.42 | % | 11,706 | | 0.57 | % |
Total interest-earning assets | | 1,073,175 | | 4.51 | % | 917,677 | | 4.29 | % |
| | | | | | | | | |
Non-interest earning assets: | | | | | | | | | |
Cash and due from banks | | 2,422 | | | | 1,837 | | | |
Premises and equipment, net | | 1,347 | | | | 1,414 | | | |
Accrued interest and other assets | | 28,871 | | | | 22,543 | | | |
Allowance for loan losses | | (8,148 | ) | | | (6,847 | ) | | |
| | | | | | | | | |
Total Assets | | $ | 1,097,667 | | | | $ | 936,624 | | | |
| | | | | | | | | |
Interest-bearing liabilities: | | | | | | | | | |
Interest checking | | $ | 211,461 | | 1.00 | % | $ | 207,969 | | 0.80 | % |
Savings and money market | | 188,560 | | 1.06 | % | 156,275 | | 0.68 | % |
Time deposits | | 252,130 | | 1.50 | % | 200,576 | | 1.28 | % |
Wholesale deposits | | 92,432 | | 1.61 | % | 73,324 | | 0.98 | % |
Total interest-bearing deposits | | 744,583 | | 1.26 | % | 638,144 | | 0.94 | % |
| | | | | | | | | |
Other borrowed funds | | 5,897 | | 1.91 | % | 19,017 | | 1.13 | % |
Subordinated notes, net of issuance costs | | 24,354 | | 6.51 | % | 24,274 | | 6.53 | % |
Total interest-bearing liabilities | | 774,834 | | 1.43 | % | 681,435 | | 1.15 | % |
| | | | | | | | | |
Noninterest-bearing liabilities: | | | | | | | | | |
Noninterest-bearing deposits | | 216,381 | | | | 167,262 | | | |
Other liabilities | | 2,105 | | | | 2,250 | | | |
| | | | | | | | | |
Stockholders’ equity | | 104,347 | | | | 85,677 | | | |
| | | | | | | | | |
Total Liabilities and Stockholders’ Equity | | $ | 1,097,667 | | | | $ | 936,624 | | | |
| | | | | | | | | |
Net Interest Margin (2) | | | | 3.48 | % | | | 3.44 | % |
(1) | Non-accrual loans are included in average balances. |
(2) | The average yields for investment securities are reported on a fully taxable-equivalent basis at a rate of 21% for 2018 and 34.5% for 2017. |
(3) | The average balances for investment securities includes restricted stock. |
