April 14, 2004 - For immediate release Contact:
Scott Shockey, CFO or Bryna Butler, Corporate Communications
1-800-468-6682 or (740) 446-2631
OVBC Increases Earnings and Dividends
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GALLIPOLIS, Ohio-- Ohio Valley Banc Corp. [Nasdaq:OVBC] President and CEO
Jeffrey E. Smith announced that the Board of Directors approved an increase in
quarterly cash dividends of 5.5 percent. Cash dividends will increase to $.19
per share from $.18 per share payable May 10, 2004 to shareholders of record
April 26, 2004. The announcement was made at the Company's Annual Shareholders'
Meeting held today at the Morris & Dorothy Haskins Ariel Theatre in Gallipolis,
Ohio. Also during the meeting, Steven B. Chapman, Robert H. Eastman and Jeffrey
E. Smith were re-elected to the Board of Directors to each serve a three year
term ending in 2007.
Just prior to the meeting, Ohio Valley Banc Corp. reported consolidated net
earnings for the quarter ended March 31, 2004 of $1,566,000 representing a 7.3
percent increase over the $1,460,000 for the same time period a year ago. Net
income per share increased 7.1 percent for the first quarter at $.45 per share
compared to $.42 per share in the first quarter of 2003.
Management was pleased to continue earnings growth into 2004. The growth in
earnings was the result of a significant improvement in asset quality. The
Company's ratio of nonperforming loans to total loans stood at .53 percent at
March 31, 2004, as compared to 1.70 percent at March 31, 2003. With the decline
in nonperforming loans, the Company's net charge-offs for the first quarter of
2004 are down $1,064,000 from the same time period last year. This decline in
nonperforming loans and net charge-offs allowed management to reduce provision
for loan losses. For the three months ended March 31, 2004, provision for loan
losses decreased $617,000 from the three months ended March 31, 2003. "As a
result of the efforts of our collectors, lenders and attorneys to reduce
nonperforming loans, the Company's balance sheet is much stronger than a year
ago, stated Smith. The allowance for loan losses was 1.38 percent of total loans
at March 31, 2004, as compared to 1.27 percent at March 31, 2003." Included in
the $8 million allowance for loan losses are estimated specific and nonspecific
allowance allocations for the increased volume of commercial loan activity.
For the first quarter of 2004, net interest income of $6,923,000 essentially
matched the net interest income for the same period last year due to the growth
in earning assets being offset by declining interest rates. Comparing the first
three months of 2004 to the same time period last year, total interest income
declined $721,000 or 6.2 percent compared to a total interest expense decline of
$728,000 or 15.5 percent. With continued low interest rates, the net interest
margin decreased to 4.24 percent for the first quarter of 2004, as compared to
4.36 percent for the same period in 2003. The Company's growth in average
earning assets for the first quarter of 2004 exceeds the prior year by
$12,589,000 or 1.9 percent.
Noninterest income totaled $1,306,000 for the first quarter of 2004 compared to
$1,446,000 a year ago representing a 10 percent decrease. The decrease in
noninterest income was related to a decline in the sales of secondary market
real estate loans due to lower mortgage refinance volume and a shift to variable
rate mortgage originations. Gain on sale of loans was down $190,000 from the
prior year. Offsetting a portion of this decline was an increase in service
charges on deposit accounts of $62,000 or 8.9 percent.
Noninterest expense totaled $5,187,000 for the three months ending March 31,
2004, an increase of only $263,000 or 5.3 percent. Salary and employee benefits,
the Company's largest noninterest expense, totaled $3,040,000 for the first
quarter of 2004, up $243,000 from the prior year. The increase was due to annual
merit increases and rising benefit costs. The remaining noninterest expenses are
up only $20,000 collectively.
Total assets increased $5,864,000 from year end 2003 to reach $713,191,000 at
March 31, 2004. Driving asset growth for the first quarter of 2004 was loan
growth of $10,835,000 which equals an annual growth rate of 7.6 percent as
compared to the 2.5 percent growth rate for 2003. Commercial loans contributed
to approximately half of the loan growth. Total deposits grew $22,577,000 from
year end to fund loan growth and to reduce borrowed funds which are down
$17,967,000. The growth in deposits was primarily in certificates of deposit
originated from local and national markets.
Smith also announced during the meeting the 29th Street Huntington SuperBank
will move to the new Wal-Mart Supercenter on U.S. Route 60 in mid summer.
Discussions were ongoing with Holzer Medical Center for a suitable location for
a SuperBank on the Holzer Medical Center/Holzer Clinic campus. The SuperBank,
which would be the 3rd in Gallia County, would bring convenience banking to
1,800 employees of Gallia County's largest industry, healthcare. He also
announced news of a major renovation planned for the traditional bank in
Jackson, Ohio.
Ohio Valley Banc Corp. common stock is traded on The NASDAQ Stock Market under
the symbol OVBC. The holding company owns three subsidiaries: Ohio Valley Bank,
with 17 offices in Ohio and West Virginia; Loan Central, with five consumer
finance company offices in Ohio, and Ohio Valley Financial Services, an
insurance agency based in Jackson, Ohio. The company's Web site is www.ovbc.com.
Forward-Looking Information
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Certain statements contained in this release which are not statements of
historical fact constitute forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Words such as "believes,"
"anticipates," "expects," "intends," "targeted" and similar expressions are
intended to identify forward-looking statements but are not the exclusive means
of identifying those statements. Forward-looking statements involve risks and
uncertainties. Actual results may differ materially from those predicted by the
forward-looking statements because of various factors and possible events,
including: (i) changes in political, economic or other factors such as inflation
rates, recessionary or expansive trends, and taxes; (ii) competitive pressures;
(iii) fluctuations in interest rates; (iv) the level of defaults and prepayment
on loans; (v) unanticipated litigation, claims, or assessments; (vi)
fluctuations in the cost of obtaining funds to make loans; and (vii) regulatory
changes. Forward-looking statements speak only as of the date on which they are
made and Ohio Valley undertakes no obligation to update any forward-looking
statement to reflect events or circumstances after the date on which the
statement is made to reflect unanticipated events.
OHIO VALLEY BANC CORP - Financial Highlights (Unaudited)
Three months ended
March 31,
2004 2003
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PER SHARE DATA
Earnings per share $0.45 $0.42
Dividend per share $0.18 $0.17
Book value per share $15.71 $14.77
Dividend payout ratio 40.22% 40.34%
Weighted average shares
outstanding 3,500,359 3,469,079
PERFORMANCE RATIOS
Return on average equity 11.54% 11.67%
Return on average assets 0.89% 0.86%
Net interest margin 4.24% 4.36%
Efficiency Ratio 62.46% 58.25%
Average Earning Assets
(in 000's) $664,606 $652,017
OHIO VALLEY BANC CORP - Consolidated Statements of Income (Unaudited)
Three months ended
(in $000's) March 31,
2004 2003
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Interest income:
Interest and fees on loans $ 9,959 $10,687
Interest and dividends on
securities 932 925
Total interest income 10,891 11,612
Interest expense:
Deposits 2,741 3,316
Borrowings 1,227 1,380
Total interest expense 3,968 4,696
Net interest income 6,923 6,916
Provision for loan losses 768 1,385
Noninterest income:
Service charges on deposit
accounts 759 697
Trust fees 52 52
Income from bank owned insurance 163 172
Gain on sale of loans 6 196
Other 326 329
Total noninterest income 1,306 1,446
Noninterest expense:
Salaries and employee benefits 3,040 2,797
Occupancy expense 328 332
Furniture and equipment expense 283 237
Data processing expense 178 160
Other 1,358 1,398
Total noninterest expense 5,187 4,924
Income before income taxes 2,274 2,053
Income taxes 708 593
NET INCOME $1,566 $1,460
OHIO VALLEY BANC CORP - Consolidated Balance Sheets (Unaudited)
(dollars in thousands except share
and per share data) March 31, December 31,
2004 2003
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ASSETS
Cash and cash equivalents 15,600 17,753
Interest-bearing deposits in other banks 857 859
Securities available-for-sale 73,242 76,352
Securities held-to-maturity
(estimated fair value: 2004 -
$13,450 , 2003 - $13,547) 12,592 12,835
Total loans 584,539 573,704
Less: Allowance for loan losses (8,040) (7,593)
Net loans 576,499 566,111
Premises and equipment, net 9,095 9,142
Accrued income receivable 3,046 2,700
Goodwill 1,267 1,267
Bank owned life insurance 13,358 13,222
Other assets 7,635 7,086
Total assets $713,191 $707,327
LIABILITIES
Noninterest-bearing deposits $64,325 $62,235
Interest-bearing deposits 465,761 445,274
Total deposits 530,086 507,509
Securities sold under agreements to
repurchase 24,085 24,018
Other borrowed funds 83,595 101,562
Subordinated debentures 13,500 13,500
Accrued liabilities 7,449 6,330
Total liabilities 658,715 652,919
SHAREHOLDERS' EQUITY
Common stock ($1.00 stated value,
10,000,000 shares authorized; 2004 -
3,667,356 shares issued,
2003 - 3,658,212 shares issued) 3,667 3,658
Additional paid-in capital 31,216 30,962
Retained Earnings 24,279 23,343
Accumulated other comprehensive income 696 624
Treasury stock, at cost (2004 - 200,095
shares, 2003 - 159,611 shares) (5,382) (4,179)
Total shareholders' equity 54,476 54,408
Total liabilities and
shareholders' equity $713,191 $707,327