EXHIBIT 99.1
Codorus Valley Bancorp, Inc.
Press Announcement dated April 25, 2007
CODORUS VALLEY BANCORP, INC. REPORTS INCREASED EARNINGS
FOR IMMEDIATE RELEASE -- York, Pennsylvania (April 25, 2007) -- Codorus
Valley Bancorp, Inc. (Nasdaq: CVLY), the parent company of PeoplesBank, today
announced earnings of $1,769,000 or $.48 per share ($.47 diluted) for the
quarter ended March 31, 2007. These results represent a $408,000 or 30% increase
over the $1,361,000 or $.37 per share ($.36 diluted) earned for the same quarter
of 2006. First quarter earnings in 2007 were favorably impacted by an $839,000
pre-tax ($554,000 after-tax) recovery of loan losses that were incurred by
PeoplesBank during 2002-2003. Due to the adequacy of the allowance for loan
losses on March 31, 2007, the full amount of the recovery was credited to loan
loss provision. The effect on net income from the reduction in loan loss
provision more than offset an increase in noninterest expense and a decrease in
net interest income. Noninterest expense increased 14% for the first quarter of
2007 due primarily to increased personnel costs, caused by the timing of
performance incentives and staff additions associated with normal business
growth, and the recognition of an $185,000 ($122,000 after-tax) prepayment
penalty on the early pay-down of a $2 million Federal Home Loan Bank advance.
The Company paid down the advance, which had an above market interest rate, to
reduce interest expense in future periods. Net interest income decreased 2% for
the first quarter of 2007 compared to the same quarter in 2006 due largely to
increased deposit costs, which were adversely affected by the inverted US
treasury yield curve environment and competitive pricing pressures. On March 31,
2007, total assets were approximately $573 million, representing an $83 million
or 17% increase above March 31, 2006. Asset growth occurred primarily in
business loans and investment securities, which were funded by strong deposit
growth. Additional detailed financial information is provided in the Financial
Highlights section of this Press Announcement.
Codorus Valley recently announced that its Board of Directors declared a
regular quarterly cash dividend of $.135 per share, payable on or before May 8,
2007, to shareholders of record April 24, 2007. In addition, a 5% stock dividend
was declared, payable on or before June 7, 2007, to shareholders of record April
24, 2007.
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The Company previously disclosed that it intended to adopt early Financial
Accounting Standards No. 159, "The Fair Value Option for Financial Assets and
Financial Liabilities," and No. 157, "Fair Value Measurement." In light of a
recent clarification by the American Institute of Certified Public Accountants
with respect to Accounting Standards No. 159 and No. 157, the Company has
determined that it will not early adopt these Standards.
Codorus Valley Bancorp, Inc. is a financial services holding company
headquartered at the Codorus Valley Corporate Center, 105 Leader Heights Road,
York, Pennsylvania. Codorus Valley primarily operates through its financial
services subsidiary, PeoplesBank, a Codorus Valley Company. PeoplesBank provides
a full range of business and consumer banking services through fourteen
financial centers located throughout York County, Pennsylvania and a loan
production office in Towson, Maryland. Mortgage banking, wealth management, and
real estate settlement services are also offered by the company. Additional
information is available on the bank's website at www.peoplesbanknet.com.
Codorus Valley Bancorp, Inc. has made forward-looking statements in this Press
Announcement. These forward-looking statements are subject to risks and
uncertainties. Forward-looking statements include information concerning
possible or assumed future results of operations of the corporation and its
subsidiaries. When words such as "believes," "expects," "anticipates," or
similar expressions occur in this Press Announcement, the Company is making
forward-looking statements. Note that many factors could affect the future
financial results of the corporation and its subsidiaries, both individually and
collectively, and could cause those results to differ materially from those
expressed in the forward-looking statements contained in this Press
Announcement. Those factors include, but are not limited to: credit risk,
changes in market interest rates, competition, economic downturn or recession,
and government regulation and supervision. The Company undertakes no obligation
to update or revise any forward-looking statements.
QUESTIONS OR COMMENTS CONCERNING THIS PRESS ANNOUNCEMENT SHOULD BE DIRECTED TO
THE FOLLOWING:
Larry J. Miller Jann Allen Weaver
Vice-Chairman, President, and CEO Treasurer
Codorus Valley Bancorp, Inc. Codorus Valley Bancorp, Inc.
717-747-1500 717-747-1502
888-846-1970 888-846-1970
lmiller@peoplesbanknet.com jweaver@peoplesbanknet.com
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Condensed Consolidated Statements of Income
(in thousands of dollars, except per share data)
Three months
ended
March 31,
---------------
2007 2006
------ ------
Interest income $9,206 $7,788
Interest expense 4,581 3,092
------ ------
Net interest income 4,625 4,696
Provision for loan losses (919) 210
Noninterest income 1,227 1,195
Gain on sale of mortgages 94 88
Noninterest expense 4,456 3,921
------ ------
Income before income taxes 2,409 1,848
Income taxes 640 487
------ ------
Net income $1,769 $1,361
====== ======
Basic earnings per share $ 0.48 $ 0.37
Diluted earnings per share $ 0.47 $ 0.36
Condensed Consolidated Statements of Financial Condition
(in thousands of dollars)
March 31, December 31, March 31,
2007 2006 2006
--------- ------------ ---------
Cash and short term investments $ 38,593 $ 35,372 $ 21,077
Investment securities 83,530 80,926 69,774
Loans 426,516 407,260 373,957
Allowance for loan losses (3,046) (3,126) (2,763)
Premises and equipment, net 10,347 10,495 11,054
Other assets 16,762 17,285 16,431
-------- -------- --------
Total assets $572,702 $548,212 $489,530
======== ======== ========
Deposits $481,296 $456,645 $407,438
Borrowed funds 43,043 45,339 39,320
Other liabilities 4,080 3,442 3,215
Shareholders' equity 44,283 42,786 39,557
-------- -------- --------
Total liabilities and
shareholders' equity $572,702 $548,212 $489,530
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Selected Financial Data
Quarterly
-----------------------------------------------
2007 2006 2006 2006 2006
1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr
------- ------- ------- ------- -------
Earnings and Per Share Data (1)
(in thousands, except per share data)
Net income $1,769 $1,131 $1,407 $1,423 $1,361
Basic earnings per share $ 0.48 $ 0.31 $ 0.38 $ 0.39 $ 0.37
Diluted earnings per share $ 0.47 $ 0.30 $ 0.38 $ 0.38 $ 0.36
Cash dividends per share $0.129 $0.122 $0.118 $0.112 $0.112
Book value per share $12.04 $11.63 $11.46 $10.99 $10.81
Average shares outstanding 3,678 3,676 3,661 3,659 3,659
Average diluted shares outstanding 3,768 3,767 3,745 3,743 3,742
Performance Ratios (%)
Return on average assets 1.28 0.85 1.08 1.15 1.13
Return on average equity 16.13 10.56 13.63 14.17 13.79
Return on average realized
equity (2) 16.03 10.50 13.42 14.02 13.64
Net interest margin (3) 3.76 3.77 3.88 4.01 4.35
Efficiency ratio (4) 72.3 66.8 63.0 63.3 64.3
Asset Quality Ratios (%)
Net loan (recoveries) charge-offs to
average loans (5) (0.82) (0.01) 0.10 (0.02) (0.02)
Allowance for losses to total loans 0.71 0.77 0.75 0.75 0.74
Nonperforming assets to total loans
and other real estate 0.99 1.09 1.38 1.44 1.03
Capital Ratios (%)
Average equity to average assets 7.91 8.00 7.96 8.12 8.19
Tier 1 leverage capital ratio 9.73 9.83 9.98 10.25 8.84
Tier 1 risk-based capital ratio 11.86 11.99 12.11 12.15 10.65
Total risk-based capital ratio 12.53 12.71 12.81 12.85 11.34
(1) per share amounts and shares outstanding were adjusted for stock dividends
(2) excludes accumulated other comprehensive income (loss), principally
unrealized gains (losses) on investment securities
(3) net interest income (tax-equivalent) as a percentage of average earning
assets
(4) noninterest expense as a percentage of net interest income and noninterest
income (tax-equivalent)
(5) quarterly net loan (recoveries) charge-offs are annualized
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