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Bank of Virginia Reports Profit for the First Quarter of 2012

MIDLOTHIAN, Va., May 8, 2012 (GLOBE NEWSWIRE) -- Bank of Virginia (the "Bank") (Nasdaq:BOVA) (www.bankofva.com), reported net income of $345,000, or $0.03 per share, for the quarter ended March 31, 2012, compared to a net loss of $1.8 million, or $0.16 per share, for the quarter ended March 31, 2011. The quarterly earnings were boosted by recoveries on loans previously charged down, a reduction in loss reserves maintained against the Bank's loan portfolio, and gains on sale of securities.

"These results confirm the success of the Bank's credit risk management strategy and the renewed pulse of the Central Virginia regional economy," said Jack Zoeller, Chairman and CEO. "We are making a concerted effort to partner with our customers who have survived and, in many cases, thrived in a down economy.   Our $40 million loan campaign has been well received by borrowers who appreciate our responsiveness and the insights afforded by our rebuilt lending staff. The Bank's proactive but disciplined approach is bearing fruit for customers and shareholders alike."

"We are especially pleased with the improvement in asset quality and reduction in our cost of funds, as they reflect the hard work of our staff, management and board of directors," said Jack Zoeller, Chairman and CEO. "We are charting an aggressive path toward sustained profitability that will lay a foundation for the longer-term strategic growth of the Bank."

Review of the balance sheet

The Bank's total assets were $165.1 million at March 31, 2012, compared to $165.5 million at December 31, 2011. Net loans increased $1.6 million, or 1.6%, from $104.7 million at December 31, 2011 to $106.3 million at March 31, 2012. Securities available for sale declined $8.0 million to $17.6 million at March 31, 2012 from $25.6 million at December 31, 2011, mainly due to $5.7 million in securities sold in the first quarter. Total cash and cash equivalents increased $5.6 million to $32.3 million at March 31, 2012 from $26.7 million at December 31, 2011, mainly due to the proceeds from the sale of securities.

On the liability side of the balance sheet, total deposits declined slightly to $146.7 million at March 31, 2012 from $147.2 million at December 31, 2011. Noninterest bearing deposits increased $2.1 million, or 12.4%, from $16.8 million at December 31, 2011 to $18.9 million at March 31, 2012. Total time deposits declined $4.3 million, or 4.2%, to $99.5 million at March 31, 2012 from $100.7 million at December 31, 2011.

Asset Quality

During the first three months of 2012, the level of nonperforming assets decreased from $10.1 million or 6.1% of assets at December 31, 2011, to $8.7 million or 5.3% of assets at March 31, 2012. Nonaccrual loans total $7.0 million, or 6.3% of total loans at March 31, 2012, compared to $8.9 million, or 8.0% of total loans at December 31, 2011. The Bank reported loan recoveries, net of charge offs, of $244,000 for the three-months ended March 31, 2012 versus charge offs, net of recoveries, of $644,000 for the same period in 2011. 

About Bank of Virginia

Bank of Virginia, a state chartered bank headquartered in Midlothian, Virginia, currently operates four full-service offices in the counties of Chesterfield and Henrico, Virginia. Bank of Virginia's common stock is traded on the NASDAQ stock market under the quotation symbol "BOVA". Additional investor relations information can be found on the internet at www.bankofva.com. Bank of Virginia is a member of the FDIC and Equal Housing Lender.

DISCLAIMER

The information as of and for the quarter ended March 31, 2012, as presented is unaudited. This news release may include forward-looking statements. These forward-looking statements are based on current expectations that involve risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may differ materially. These risks include: changes in business or other market conditions; the timely development, production and acceptance of new products and services; the challenge of managing asset/liability levels; the management of credit risk and interest rate risk; the difficulty of keeping expense growth at modest levels while increasing revenues; and other risks detailed in the Bank's periodic filings with the Board of Governors of the Federal Reserve System, including the Bank's annual report on Form 10-K. Pursuant to the Private Securities Litigation Reform Act of 1995, the Bank does not undertake to update forward-looking statements contained within this news release.

Bank of Virginia
Selected Financial Information and Other Data
($ in thousands, except per share data)
       
  For the three months ended
  March 31, 2012 December 31, 2011 March 31, 2011
Summary of Operations      
Total Interest Income 1,802 1,851 2,372
Total Interest Expense 607 650 911
Net Interest Income 1,195 1,201 1,461
Provision for loan losses (549) 49 1,483
Net Int. Inc. After Prov. for Loan Losses 1,744 1,152 (22)
Non Interest Income 367 73 143
Non Interest Expense 1,766 1,869 1,888
Net Income 345 (644) (1,767)
       
Earnings (loss) per share  $ 0.03  $ (0.06)  $ (0.16)
Book value per share  $ 1.13  $ 1.12  $ 1.34
Net interest margin 3.13% 3.01% 3.12%
Return on average assets 0.85% -1.55% -3.39%
Return on average equity 11.01% -19.75% -40.50%
       
Balance Sheet summary      
Total loans 111,661 110,334 137,698
Total earning assets 152,274 159,590 198,841
Total assets 165,118 165,465 204,707
Deposits 146,709 147,241 178,511
FHLB borrowings 5,000 5,000 10,000
Shareholders' equity 12,750 12,667 15,214
       
Asset Qualit Ratios      
Nonaccrual loans 7,036 8,878 10,186
Other real estate owned 1,682 1,262 2,173
Allowance for loan losses 5,367 5,672 7,671
Nonaccrual loans to total loans 6.30% 8.04% 7.40%
Allowance for loan losses to total loans 4.81% 5.14% 5.57%
       
CONTACT: Jack Zoeller,
         Chairman and CEO, 804-763-1333
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