FVCBankcorp, Inc. (NASDAQ: FVCB) (the “Company”) today reported
its financial results for the fourth quarter and full year of
2023.
Fourth Quarter Selected Financial Highlights
- Strong Credit Quality. Nonperforming loans totaled $1.8
million at December 31, 2023, or 0.08% of total assets, a decrease
of $2.7 million, or 59%, from the prior year ended December 31,
2022. Net charge-offs of $49 thousand were recorded during the
fourth quarter of 2023, or 0.01% of average total loans.
- Prudent Balance Sheet Repositioning. During the fourth
quarter of 2023, the Company sold a portion of its investment
portfolio totaling $61.4 million of book value available-for-sale
securities with a weighted average book yield of 1.54% and a
projected earn-back of less than three years. This repositioning
resulted in an after-tax loss of $8.5 million.
- Low Uninsured Deposit Metrics Compared to Total
Deposits. As of December 31, 2023, estimated uninsured deposits
improved to 31.1% of total deposits from 39.7% at December 31,
2022, when excluding collateralized deposits. The Company has
sufficient capital and liquidity resources to satisfy these
obligations.
- Diverse Sources of Available Liquidity. At December 31,
2023, the Company’s liquidity position, which includes cash
totaling $60.5 million, unencumbered investment securities of
$162.1 million, and available unsecured and secured borrowing
capacity totaling $705.1 million, was significantly in excess of
its estimated uninsured deposits (excluding collateralized
deposits) totaling $574.6 million, or 31.1% of total deposits.
- Strong, Well Capitalized Balance Sheet. All of FVCbank’s
(the “Bank”) regulatory capital components and ratios are well in
excess of thresholds required to be considered "well capitalized",
with total risk-based capital to risk-weighted assets of 13.83% at
December 31, 2023. The tangible common equity ("TCE") to total
assets ("TA") ratio for the Bank increased to 10.12% at December
31, 2023, from 8.86% at December 31, 2022. The Bank’s investment
securities are classified as available-for-sale, and therefore the
decrease in market value of these securities is fully reflected in
the TCE/TA ratio.
As a result of the above mentioned repositioning, the Company
recorded a net loss of $5.1 million, or $0.28 diluted loss per
share, for the quarter ended December 31, 2023, compared to net
income of $4.9 million, or $0.27 diluted earnings per share for the
quarter ended December 31, 2022.
For the year ended December 31, 2023, the Company reported net
income of $3.8 million, or $0.21 diluted earnings per share,
compared to net income of $25.0 million, or $1.35 diluted earnings
per share for the year ended December 31, 2022. The year ended
December 31, 2023 results include after-tax losses of $12.2 million
for first quarter 2023 and fourth quarter 2023 securities sale. In
addition, the Company reduced its future occupancy expense through
a reduction in office space. The Company wrote-off two leases
totaling $273,000 during the fourth quarter of 2023 to reduce
excess office space and to consolidate two branch locations in
Montgomery County, Maryland. Lastly, the Company reduced staffing
which resulted in severance costs of $63,000 during the fourth
quarter of 2023 and $184,000 for the year ended December 31, 2023.
These initiatives reduce operating expenses in 2024 by over $1.0
million.
Commercial bank operating earnings, which exclude losses on the
above-noted securities sales, office space reduction costs,
severance costs, and 2022 merger-related expenses, all net of tax,
for the three months ended December 31, 2023 and September 30, 2023
were $3.8 million and $4.0 million, respectively, a decrease of
$280 thousand. Diluted commercial bank operating earnings per share
for the three months ended December 31, 2023 and September 30, 2023
were $0.21 and $0.22, respectively. For the linked quarter ended
September 30, 2023, commercial bank operating earnings included
after-tax reversal of provision for credit losses totaling $569
thousand. For the years ended December 31, 2023 and 2022,
commercial bank operating earnings were $16.3 million and $25.1
million, respectively. Diluted commercial bank operating earnings
per share for the year ended December 31, 2023 and 2022 were $0.90
and $1.36, respectively.
For the three months ended December 31, 2023 and September 30,
2023, pre-tax pre-provision operating income (which also excludes
losses on securities sales, office space reduction costs and
severance costs) was $4.7 million and $4.5 million, respectively,
an increase of $206 thousand.
The Company considers commercial bank operating earnings and
pre-tax pre-provision operating income useful comparative financial
measures of the Company’s operating performance over multiple
periods. Both commercial bank operating earnings and pre-tax
pre-provision operating income are determined by methods other than
in accordance with U.S. generally accepted accounting principles
(“GAAP”). A reconciliation of non-GAAP financial measures to their
most comparable financial measure in accordance with GAAP can be
found in the tables below.
Management Comments
David W. Pijor, Esq., Chairman and Chief Executive Officer of
the Company, said:
“2023 was a challenging year for financial institutions,
including FVCbank. Our commitment to sound strategic banking and
serving our clients are and will always be our top priorities. We
successfully implemented a new digital banking platform in early
2023, enhancing our client offerings and improving operating
efficiencies. We continue to lend to businesses in our market area
through our disciplined credit culture as evidenced by our
historically low credit losses. The balance sheet repositionings
and our focus on our operating structure will improve profitability
and efficiencies going into 2024. We are well positioned to create
shareholder value and will remain focused on client service,
quality core growth, expense discipline, and strategic balance
sheet management.”
Statement of Condition
Total assets were $2.19 billion at December 31, 2023 and $2.34
billion at December 31, 2022, a decrease of $153.7 million, or 7%.
This decrease was a result of the Company’s strategic balance sheet
management which was focused on repositioning the balance sheet
through two investment securities restructurings and reducing its
reliance on wholesale funding to limit funding costs.
Loans receivable, net of deferred fees, were $1.83 billion at
December 31, 2023 and $1.84 billion at December 31, 2022, a
decrease of $11.9 million, or 0.6%. Compared to September 30, 2023,
loans receivable, net of deferred fees, decreased $20.9 million, or
1%, from $1.85 billion. During the fourth quarter of 2023, new
commercial loan originations totaled $15.4 million with a weighted
average rate of 8.32% and repayments of loans totaled $52.2 million
with a weighted average rate of 7.29%. Commercial line activity,
which has a weighted average rate 8.69%, increased $26.9 million
during the fourth quarter of 2023. Commercial construction loans
paid down $6.6 million during the fourth quarter of 2023. The
Company’s warehouse line with Atlantic Coast Mortgage, LLC (“ACM”)
decreased $4.4 million during the fourth quarter of 2023. During
the first three weeks of January 2024, the Company originated and
funded $29.4 million in new commercial loans that were expected to
close prior to year-end.
Investment securities were $171.9 million at December 31, 2023
and $278.3 million at December 31, 2022, a decrease of $106.5
million, or 38%. Investment securities decreased $44.6 million
during the quarter ended December 31, 2023, primarily as a result
of a second balance sheet restructuring whereby the Company sold
$61.4 million in book value available-for-sale securities with a
weighted average book yield of 1.54%. Offsetting this quarterly
decrease was an improvement in the market value of the investment
securities portfolio totaling $21.8 million. The Company previously
sold $40.3 million in book value available-for-sale securities
during February 2023 to de-leverage its balance sheet and invest
funds in higher yielding assets.
Total deposits were $1.85 billion at December 31, 2023 and $1.83
billion at December 31, 2022, an increase of $15.1 million, or 1%.
Noninterest-bearing deposits were $396.7 million at December 31,
2023, or 21.5% of total deposits. At December 31, 2023, core
deposits, which exclude wholesale deposits, increased $17.9 million
from December 31, 2022, or 1%. As a member of the IntraFi Network,
the Bank offers products to its customers who seek to maximize FDIC
insurance protection (“reciprocal deposits”). At December 31, 2023
and December 31, 2022, reciprocal deposits totaled $254.1 million
and $117.6 million, respectively, and are considered part of the
Company’s core deposit base. Time deposits (which exclude wholesale
deposits) increased $45.9 million, or 18%, to $306.3 million at
December 31, 2023 from December 31, 2022, and were 19% of core
deposits at December 31, 2023, representing new and existing
customer deposits as customers were looking to fix interest rates
on their deposit balances.
The Company has had consistent core deposit inflows over the
last several quarters, including the fourth quarter of 2023, with
new non-time deposit accounts totaling $116.5 million (which
includes $8.3 million in new noninterest-bearing deposits) compared
to $200 million (which includes $7.6 million in noninterest-bearing
deposits) for the third quarter of 2023. Title and escrow-related
deposits decreased $69.1 million from September 30, 2023 to
December 31, 2023 which was primarily attributable to a few large
commercial transactions that settled prior to year-end. Deposits
from municipalities decreased $20.6 million during the fourth
quarter of 2023 due to time deposit maturities and the repricing of
these collateralized deposits were at premium interest rates. The
Company maintains a growing deposit pipeline headed into the first
quarter of 2024.
Total wholesale funding (which includes wholesale deposits and
advances from the Federal Home Loan Bank of Atlanta (“FHLB”)
decreased $182.7 million, or 36%, during 2023. Wholesale funding,
which totaled $330.3 million at December 31, 2023, carried a
weighted average rate of 3.62% including $250 million in
pay-fixed/receive-floating interest rate swaps at an average rate
of 3.25%. Wholesale deposits decreased $2.7 million to $245.3
million during 2023 and FHLB advances decreased $180.0 million
during 2023.
Shareholders’ equity at December 31, 2023 was $217.1 million, an
increase of $14.7 million, or 7%, from December 31, 2022. Earnings
for the year ended December 31, 2023 contributed $3.8 million to
the increase in shareholders’ equity. As a result of the Company’s
adoption of Accounting Standards Update 2016-13 (“CECL”) on January
1, 2023, retained earnings decreased $2.8 million. In addition,
during the first six months of 2023, the Company repurchased
115,750 of its common shares at an average price of $12.51
(including commissions) in accordance with its approved share
repurchase program, reducing shareholders’ equity $1.4 million
during 2023. Accumulated other comprehensive loss decreased $12.4
million, which was related to the improvement in other
comprehensive income associated with the Company’s investment
portfolio and losses recorded from the sale of investment
securities during 2023.
Book value per share at December 31, 2023 and December 31, 2022
was $12.19 and $11.58, respectively. Tangible book value per share
(a non-GAAP financial measure which is defined in the tables below)
at December 31, 2023 and December 31, 2022 was $11.77 and $11.14,
respectively. Tangible book value per share, excluding accumulated
other comprehensive loss (a non-GAAP financial measure which is
defined in the tables below), at December 31, 2023 and December 31,
2022 was $13.12 and $13.23, respectively.
The Bank is well-capitalized at December 31, 2023, with total
risk-based capital of 13.83%, common equity tier 1 risk-based
capital of 12.80%, and tier 1 leverage ratio of 10.77%.
Asset Quality
The Company adopted CECL on January 1, 2023 in accordance with
the required implementation date, and recorded the impact of the
adoption to retained earnings, net of deferred income taxes, as
required by the accounting standard. Note that prior to the
adoption of CECL, the Company utilized an incurred loss model to
derive its best estimate of the allowance for credit losses.
Reserves for credit losses increased $3.7 million and consisted of
increases to the allowance for credit losses on loans as well as
the Company's reserve for unfunded commitments (referred to in
combination herein as “ACL”). For the fourth quarter of 2023 and
year ended December 31, 2023, subsequent to the aforementioned
adoption, the Company recorded no provision for credit losses and
$132 thousand, respectively, compared to a provision of $729
thousand for the three months ended December 31, 2022 and a
provision of $2.6 million for the year ended December 31, 2022. The
ACL to total loans, net of fees, was 1.06% at December 31, 2023,
compared to 0.87% at December 31, 2022.
The Company has maintained disciplined credit guidelines during
the rising interest rate environment. The Company proactively
monitors the impact of rising interest rates on its adjustable
loans as the industry navigates through this economic cycle of
increased inflation and higher interest rates. Certain credit
quality metrics improved during 2023 as nonperforming loans and
loans 90 days or more past due at December 31, 2023 totaled $1.8
million, or 0.08% of total assets, compared to $4.5 million, or
0.19%, of total assets at December 31, 2022. Watchlist credits
increased to $28.8 million at December 31, 2023, an increase of
$14.3 million from December 31, 2022, as the Company proactivity
manages the credit quality of its loan portfolio, including
reducing its commercial real estate concentrations, which has
resulted in limited credit losses over its history. The Company had
no other real estate owned.
The Company recorded net charge-offs of $49 thousand during the
fourth quarter of 2023 and $375 thousand for the year ended
December 31, 2023. The ACL (which includes the reserve for unfunded
commitments) at December 31, 2023 and December 31, 2022, was $19.5
million and $16.0 million, respectively. ACL coverage to
nonperforming loans increased to 1065% at December 31, 2023,
compared to 357% at December 31, 2022 as a result of the Company’s
improved credit quality and adoption of CECL.
Commercial real estate and construction loans totaled $1.24
billion, or 68% of total loans, net of fees, at December 31, 2023.
The commercial real estate portfolio, including construction loans,
is diversified by asset type and geographic concentration. The
Company manages this portion of the portfolio in a disciplined
manner, and has comprehensive policies to monitor, measure and
mitigate its loan concentrations within this portfolio segment,
including rigorous credit approval, monitoring and administrative
practices. Included in commercial real estate are loans secured by
office buildings totaling $92.9 million, or 5% of total loans, and
retail shopping centers totaling $264.0 million, or 14% of total
loans, at December 31, 2023. Multi-family commercial properties
totaled $178.6 million, or 10% of total loans, at December 31,
2023. The following table provides further stratification of these
and additional asset classes at December 31, 2023 (dollars in
thousands).
Owner Occupied Commercial Real Estate Non-Owner Occupied
Commercial Real Estate Construction Asset Class
Average
Loan-to-
Value (1)
Number
of Total
Loans
Bank Owned
Principal (2)
Average
Loan-to-
Value (1)
Number
of Total
Loans
Bank Owned
Principal (2)
Top 3 Geographic
Concentration
Number of
Total Loans
Bank Owned
Principal (2)
Total Bank
Owned
Principal (2)
% of Total
Loans
Office, Class A
70%
6
$
7,558
47%
4
$
3,776
Counties of Fairfax and Loudoun,
Virginia and Montgomery County, Maryland
0
$
-
$
11,334
Office, Class B
46%
35
13,751
47%
31
61,323
-
-
75,074
Office, Class C
52%
7
3,793
41%
8
1,953
1
780
6,526
Subtotal
48
$
25,102
43
$
67,052
1
$
780
$
92,934
5%
Retail- Neighborhood/Community Shop
-
$
-
44%
31
$
84,627
Prince George's County, Maryland,
Fairfax County, Virginia and Washington, D.C.
2
$
10,944
$
95,571
Retail- Restaurant
57%
9
8,183
45%
16
26,931
-
-
35,114
Retail- Single Tenant
59%
5
2,001
42%
20
36,255
-
-
38,256
Retail- Anchored, Other
71%
1
2,046
53%
12
41,572
-
-
43,618
Retail- Grocery-anchored
0
-
46%
8
50,154
1
1,264
51,418
Subtotal
15
$
12,230
87
$
239,539
4
$
12,208
$
263,977
14%
Multi-family, Class A (Market)
-
$
-
27%
1
$
-
Washington, D.C., Baltimore City,
Maryland and Arlington County, Virginia
1
$
729
$
729
Multi-family, Class B (Market)
-
-
63%
21
78,559
-
-
78,559
Multi-family, Class C (Market)
-
-
57%
57
71,902
2
6,816
78,718
Multi-Family-Affordable Housing
-
-
53%
10
16,524
1
4,075
20,599
Subtotal
-
$
-
89
$
166,985
4
$
11,620
$
178,605
10%
Industrial
52%
43
$
70,267
50%
38
$
128,238
Prince William County, Virginia,
Fairfax County, Virginia and Howard County, Maryland
1
$
269
$
198,774
Warehouse
52%
14
18,761
33%
10
11,557
-
-
30,318
Flex
51%
15
18,727
54%
14
56,531
2
-
75,258
Subtotal
72
$
107,755
62
$
196,326
3
$
269
304,350
17%
Hotels
-
$
-
43%
9
$
52,588
1
$
6,410
58,998
3%
Mixed Use
47%
10
$
6,174
61%
37
$
68,489
0
$
-
74,663
4%
Other (including net deferred costs)
$
61,628
$
87,765
$
116,711
$
266,104
15%
Total commercial real estate and construction loans, net of
fees, at December 31, 2023
$
212,889
$
878,744
$
147,998
$
1,239,631
68%
(1) Loan-to-value is determined at origination date
against current bank-owned principal. (2) Bank-owned principal is
not adjusted for deferred fees and costs. (3) Minimum debt service
coverage policy is 1.30x for Owner Occupied and 1.25x for Non-Owner
Occupied at origination.
The loans shown in the above table exhibit strong credit
quality, reflecting only one classified delinquency at December 31,
2023 which totaled $851 thousand with a specific reserve of $187
thousand. During its assessment of the allowance for credit losses,
the Company addressed the credit risks associated with these
portfolio segments and believes that as a result of its
conservative underwriting discipline at loan origination and its
ongoing loan monitoring procedures, the Company has appropriately
reserved for possible credit concerns in the event of a downturn in
economic activity.
Minority Investment in Mortgage Banking Operation
In August 2021, the Company acquired a membership interest in
ACM to diversify its loan portfolio while providing competitive
residential mortgage products to its customers and to generate
additional revenue. The Company’s investment in ACM is reflected as
a nonconsolidated minority investment, and as such, the Company’s
income generated from the investment is included in non-interest
income. For the fourth quarter of 2023, the Company reported a
pre-tax loss of $1.3 million compared to a pre-tax loss of $1.4
million for the quarter ended December 31, 2022 related to its
investment in ACM. For the year ended December 31, 2023 and 2022,
pre-tax losses attributable to its investment in ACM totaled $2.8
million and $659 thousand, respectively. ACM management is
continuing to evaluate and look for opportunities to further reduce
spend and increase revenue where possible.
Income Statement
The Company recorded a net loss of $5.1 million for the three
months ended December 31, 2023, compared to net income of $4.9
million for the same period of 2022. The net loss for the fourth
quarter of 2023 includes the Company’s portion of losses from its
membership interest in ACM, which was $1.3 million pre-tax,
compared to a pre-tax loss of $1.4 million for the quarter ended
December 31, 2022, in addition to losses from securities sales
during the fourth quarter of 2023 totaling $11.0 million. Excluding
securities sales, office reduction costs and severance costs, bank
operating earnings (non-GAAP) totaled $3.8 million net of taxes for
the fourth quarter of 2023.
Interest income on loans increased $3.3 million, or 15%, for the
three months ended December 31, 2023, compared to the same period
of 2022. Compared to the linked quarter, interest income on loans
decreased $494 thousand, or 2%, for the three months ended December
31, 2023, primarily as a result of a decrease in average loans. The
increase in interest income for the three months ended December 31,
2023, compared to the year ago quarter was primarily related to an
increase in loan yields, which increased 51 basis points, and the
volume of average loans, which increased $80.2 million. On a linked
quarter basis, the yield on average loans receivable increased by 2
basis points to 5.42%.
At December 31, 2023, approximately $308 million, or 21%, of the
Company’s commercial loan portfolio is expected to reprice during
2024, an additional 19% will reprice within 24-36 months, and 29%
will reprice within the next three to five years. The repricing of
the commercial loan portfolio will improve loan yields in future
periods.
Interest expense on deposits increased $6.9 million for the
three months ended December 31, 2023, compared to the same period
of 2022, and decreased $1.0 million compared to the three months
ended September 30, 2023, reflecting the impact of the Company’s
decreased reliance on wholesale deposits compared to the previous
quarter. The cost of deposits for the fourth quarter of 2023 was
2.78% compared to 2.71% for the third quarter of 2023, an increase
of 7 basis points, and an increase of 149 basis points from 1.29%
for the year-ago fourth quarter.
Net interest income totaled $12.7 million for the quarter ended
December 31, 2023, a decrease of $676 thousand, or 5%, compared to
the third quarter of 2023, and a decrease of $3.2 million, or 20%,
compared to the year ago quarter. Compared to the year ago quarter
ended December 31, 2022, the decrease in net interest income for
the fourth quarter of 2023 is primarily due to an increase in
funding costs, which have increased precipitously as a result of
Federal Reserve monetary policy coupled with the need to meet
intense competition from market area banks, brokerages and the U.S.
Treasury.
The Company's net interest margin decreased less than 1% to
2.37% for the quarter ended December 31, 2023 compared to 2.39% for
the linked quarter ended September 30, 2023 and decreased from
2.96% for the year ago quarter ended December 31, 2022. The Company
continues to consider possible balance sheet strategies to improve
net interest margin in future periods. The Company’s net interest
margin for the year ended December 31, 2023 and 2022 was 2.49% and
3.19%, respectively.
The Company’s cycle-to-date deposit beta (calculated comparing
the change in deposit interest rates from March 31, 2022 to
December 31, 2023 including noninterest-bearing deposits and
excluding wholesale deposits) is approximately 42% over the past
cycle since the Federal Reserve began increasing short-term
interest rates.
Below is a table illustrating the Company’s quarterly loan and
deposit betas from the second quarter of 2022 through the fourth
quarter of 2023.
Loan & Deposit Betas (vs. Fed Funds
Effective)
3Q22
4Q22
1Q23
2Q23
3Q23
4Q23
Cycle-to-Date (1)
Fed Funds Effective (average)
2.19
%
3.65
%
4.52
%
4.99
%
5.26
%
5.33
%
Deposit Costs Interest
Bearing Deposits - excluding wholesale
0.88
%
1.65
%
2.39
%
2.88
%
3.32
%
3.46
%
Wholesale Deposits
0.88
%
2.38
%
3.56
%
3.89
%
3.86
%
3.91
%
Total Deposits
0.64
%
1.29
%
1.97
%
2.40
%
2.74
%
2.78
%
Total Deposits - excluding wholesale
0.63
%
1.20
%
1.71
%
2.07
%
2.48
%
2.62
%
Quarterly Beta Interest
Bearing Deposits
20
%
53
%
86
%
104
%
163
%
200
%
55
%
Wholesale Deposits
64
%
103
%
137
%
70
%
-11
%
71
%
65
%
Total Deposits
16
%
44
%
79
%
91
%
126
%
57
%
45
%
Total Deposits - excluding wholesale
15
%
39
%
59
%
76
%
152
%
200
%
42
%
Loan Yields Loans
(excluding net accretion)
4.41
%
4.75
%
4.91
%
5.15
%
5.27
%
5.31
%
As reported
4.64
%
4.91
%
5.11
%
5.35
%
5.40
%
5.42
%
Quarterly Beta Loans
(excluding net accretion)
18
%
23
%
18
%
51
%
46
%
47
%
25
%
(1) Cycle-to-date reflects changes since first quarter of
2022 and incorporates the increases in the average Fed Funds
effective rate.
The Company recorded noninterest income as a loss of $9.9
million for the quarter ended December 31, 2023 compared to income
of $225 thousand for the linked quarter ended September 30, 2023
and a loss of $10 thousand for the quarter ended December 31, 2022.
The loss associated with the Company’s investment in ACM was $1.3
million for the three months ended December 31, 2023, compared to a
loss of $650 thousand for the linked quarter ended September 30,
2023 and a loss of $1.4 million for the year ago quarter ended
December 31, 2022. The losses recorded for ACM for the fourth
quarter and year ended December 31, 2023 were offset by income
recorded from other holding company investments totaling $1.6
million.
Fee income from loans was $35 thousand for the quarter ended
December 31, 2023, compared to $74 thousand for the fourth quarter
of 2022. Service charges on deposit accounts and other fee income
totaled $385 thousand for the fourth quarter of 2023, an increase
of $38 thousand from the year ago quarter. Income from bank-owned
life insurance increased $29 thousand to $385 thousand for the
three months ended December 31, 2023, compared to $356 thousand for
the same period of 2022.
For the year ended December 31, 2023, the Company recorded
noninterest income as a loss of $13.4 million, which was primarily
associated with its securities sales transactions executed during
the first and fourth quarters of 2023, compared to noninterest
income of $2.8 million for the comparable period of 2022. During
2023, the Company recorded a loss of $15.6 million related to its
sales of available-for-sale investment securities as part of the
Company's balance sheet repositioning strategy. The loss associated
with the Company’s investment in ACM was $2.7 million for the
twelve months ended December 31, 2023, compared to a loss of $659
thousand for the twelve months ended December 31, 2022.
Noninterest expense totaled $9.4 million for the quarter ended
December 31, 2023 compared to $9.2 million for the same three-month
period of 2022, an increase of $200 thousand, or 2%. On a linked
quarter basis, noninterest expense increased $354 thousand, or 4%,
from $9.0 million for the quarter ended September 30, 2023. The
increase for the fourth quarter of 2023 was primarily related to
office space reduction costs of $273 thousand and severance costs
of $63 thousand as the Company continues to evaluate its overhead
expenses. Salaries and benefits expense remained at $5.3 million
for each of the quarters ended December 31, 2023 and September 30,
2023, and was $5.2 million for the quarter ended December 31, 2022.
The maintenance of salaries and benefits expense at this level is a
result of the Company’s continued expense management including
process improvement through the use of technology.
Internet banking and software expense increased $226 thousand to
$701 thousand for the fourth quarter of 2023 compared to the
quarter ended December 31, 2022, primarily as a result of the
implementation of enhanced customer software solutions. Other
operating expenses totaled $1.2 million for each of the third and
fourth quarters of 2023 compared to $1.4 million for the fourth
quarter of 2022. The Company continues to identify and assess
opportunities to reduce operating expenses including analysis of
its branch and office locations.
For the twelve months ended December 31, 2023 and 2022,
noninterest expense was $36.7 million and $34.5 million,
respectively, an increase of $2.2 million, or 6%, primarily as a
result of the aforementioned increases in internet banking and
software expense and state franchise taxes.
The Company recorded a benefit for income taxes of $1.5 million
for the three months ended December 31, 2023, compared to a
provision for income taxes of $1.0 million for the same period in
2022. For the year ended December 31, 2023 and 2022, provision for
income tax expense was $410 thousand and $6.0 million,
respectively.
About FVCBankcorp, Inc.
FVCBankcorp, Inc. is the holding company for FVCbank, a
wholly-owned subsidiary that commenced operations in November 2007.
FVCbank is a $2.19 billion asset-sized Virginia-chartered community
bank serving the banking needs of commercial businesses, nonprofit
organizations, professional service entities, their owners and
employees located in the greater Baltimore and Washington, D.C.
metropolitan areas. FVCbank is based in Fairfax, Virginia, and has
9 full-service offices in Arlington, Fairfax, Manassas, Reston and
Springfield, Virginia, Washington, D.C., and Baltimore, Bethesda,
and Rockville, Maryland.
For more information about the Company, please visit the
Investor Relations page of FVCBankcorp, Inc.’s website,
www.fvcbank.com.
Cautionary Note About Forward-Looking Statements
This press release may contain statements relating to future
events or future results of the Company that are considered
“forward-looking statements” under the Private Securities
Litigation Reform Act of 1995. These forward-looking statements
represent plans, estimates, objectives, goals, guidelines,
expectations, intentions, projections and statements of our beliefs
concerning future events, business plans, objectives, expected
operating results and the assumptions upon which those statements
are based. Forward-looking statements include, without limitation,
any statement that may predict, forecast, indicate or imply future
results, performance or achievements, and are typically identified
with words such as “may,” “could,” “should,” “will,” “would,”
“believe,” “anticipate,” “estimate,” “expect,” “aim,” “intend,”
“plan,” or words or phases of similar meaning. We caution that the
forward-looking statements are based largely on our expectations
and are subject to a number of known and unknown risks and
uncertainties that are subject to change based on factors which
are, in many instances, beyond our control. Actual results,
performance or achievements could differ materially from those
contemplated, expressed or implied by the forward-looking
statements. The following factors, among others, could cause our
financial performance to differ materially from that expressed in
such forward-looking statements: general business and economic
conditions, including higher inflation and its impacts, nationally
or in the markets that the Company serves could adversely affect,
among other things, real estate valuations, unemployment levels,
the ability of businesses to remain viable, consumer and business
confidence and consumer and business spending, which could lead to
decreases in demand for loans, deposits, and other financial
services that the Company provides and increases in loan
delinquencies and defaults; the risk of changes in interest rates
on levels, composition and costs of deposits, loan demand, and the
values and liquidity of loan collateral, securities, and interest
sensitive assets and liabilities; changes in the Company’s
liquidity requirements could be adversely affected by changes in
its assets and liabilities; changes in the assumptions underlying
the establishment of reserves for possible credit losses; changes
in market conditions, specifically declines in the commercial and
residential real estate market, volatility and disruption of the
capital and credit markets, and soundness of other financial
institutions we do business with; risks inherent in making loans
such as repayment risks and fluctuating collateral values; the
Company’s investment securities portfolio is subject to credit
risk, market risk, and liquidity risk as well as changes in the
estimates used to value the securities in the portfolio; the
effects of, and changes in, trade, monetary and fiscal policies and
laws, including interest rate policies of the Board of Governors of
the Federal Reserve System, inflation, interest rate, market and
monetary fluctuations; declines in the Company's common stock price
or the occurrence of what management would deem to be a triggering
event that could, under certain circumstances, cause us to record a
noncash impairment charge to earnings in future periods; the
strength of the United States economy in general and the strength
of the local economies in which we conduct operations; geopolitical
conditions, including acts or threats of terrorism, or actions
taken by the United States or other governments in response to acts
or threats of terrorism and/or military conflicts, which could
impact business and economic conditions in the United States and
abroad; the occurrence of significant natural disasters, including
severe weather conditions, floods, health related issues, and other
catastrophic events; our management of risks inherent in our real
estate loan portfolio, and the risk of a prolonged downturn in the
real estate market, which could impair the value of our collateral
and our ability to sell collateral upon any foreclosure; changes in
consumer spending and savings habits; technological and social
media changes; changing bank regulatory conditions, policies or
programs, whether arising as new legislation or regulatory
initiatives, that could lead to restrictions on activities of banks
generally, or our subsidiary bank in particular, more restrictive
regulatory capital requirements, increased costs, including deposit
insurance premiums, regulation or prohibition of certain income
producing activities or changes in the secondary market for loans
and other products; the impact of changes in financial services
policies, laws and regulations, including laws, regulations and
policies concerning taxes, banking, securities and insurance, and
the application thereof by regulatory bodies; the impact of changes
in laws, regulations and policies affecting the real estate
industry; the effect of changes in accounting policies and
practices, as may be adopted from time to time by bank regulatory
agencies, the U.S. Securities and Exchange Commission (“SEC”), the
Public Company Accounting Oversight Board, the Financial Accounting
Standards Board or other accounting standards setting bodies; the
timely development of competitive new products and services and the
acceptance of these products and services by new and existing
customers; the willingness of users to substitute competitors’
products and services for our products and services; the effect of
acquisitions we may make, including, without limitation, the
failure to achieve the expected revenue growth and/or expense
savings from such acquisitions; changes in the level of our
nonperforming assets and charge-offs; our involvement, from time to
time, in legal proceedings and examination and remedial actions by
regulators; and potential exposure to fraud, negligence, computer
theft and cyber-crime. The foregoing factors should not be
considered exhaustive and should be read together with other
cautionary statements that are included in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2022, including
those discussed in the section entitled “Risk Factors,” and in the
Company’s other periodic and current reports filed with the SEC. If
one or more of the factors affecting our forward-looking
information and statements proves incorrect, then our actual
results, performance or achievements could differ materially from
those expressed in, or implied by, forward-looking information and
statements contained in this press release. Therefore, we caution
you not to place undue reliance on our forward-looking information
and statements. We will not update the forward-looking statements
to reflect actual results or changes in the factors affecting the
forward-looking statements. New risks and uncertainties may emerge
from time to time, and it is not possible for us to predict their
occurrence or how they will affect us.
FVCBankcorp, Inc. Selected Financial Data (Dollars
in thousands, except per share data) (Unaudited)
At or For the Three Months
Ended
For the Years Ended December
31,
12/31/2023
12/31/2022
2023
2022
Selected Balances Total assets
$
2,190,558
$
2,344,322
Total investment securities
181,347
293,945
Total loans, net of deferred fees
1,828,564
1,840,434
Allowance for credit losses on loans
(18,871
)
(16,040
)
Total deposits
1,845,292
1,830,162
Subordinated debt
19,620
19,565
Other borrowed funds
85,000
265,000
Reserve for unfunded commitments
602
- -
Total stockholders’ equity
217,117
202,382
Summary Results of Operations Interest income
$
26,651
$
23,341
$
106,615
$
80,682
Interest expense
13,992
7,462
52,219
15,438
Net interest income
12,659
15,879
54,396
65,244
Provision for credit losses
- -
729
132
2,629
Net interest income after provision for credit losses
12,659
15,150
54,264
62,615
Noninterest income - loan fees, service charges and other
420
421
1,865
1,667
Noninterest income - bank owned life insurance
385
356
1,452
1,200
Noninterest income (loss) - minority membership interest
321
(787
)
(1,110
)
(33
)
Noninterest income - loss on sale of available-for-sale investment
securities
(10,985
)
- -
(15,577
)
- -
Noninterest expense
9,402
9,202
36,662
34,460
Income (loss) before taxes
(6,602
)
5,938
4,232
30,989
Income tax expense (benefit)
(1,531
)
1,035
410
6,005
Net income (loss)
(5,071
)
4,903
3,822
24,984
Per Share Data Net income (loss), basic (5)
$
(0.28
)
$
0.28
$
0.22
$
1.43
Net income (loss), diluted (5)
$
(0.28
)
$
0.27
$
0.21
$
1.35
Book value (5)
$
12.19
$
11.58
Tangible book value (1)(5)
$
11.77
$
11.14
Tangible book value, excluding accumulated other comprehensive
losses (1)(5)
$
13.12
$
13.23
Shares outstanding
17,806,995
17,475,668
Selected Ratios Net interest margin
(2)
2.37
%
2.96
%
2.49
%
3.19
%
Return (loss) on average assets
(2)
(0.92
)
%
0.89
%
0.17
%
1.18
%
Return (loss) on average equity
(2)
(9.51
)
%
9.87
%
1.82
%
12.34
%
Efficiency
(3)
NM
%
57.99
%
89.36
%
50.62
%
Loans, net of deferred fees to total deposits
99.09
%
100.56
%
Noninterest-bearing deposits to total deposits
21.50
%
23.95
%
Reconciliation of Net Income (GAAP) to Commercial Bank Operating
Earnings (Non-GAAP)(4) GAAP net income reported above
$
(5,071
)
$
4,903
$
3,822
$
24,984
Add: Loss on sale of available-for-sale investment securities
10,985
- -
15,577
- -
Add: Merger and acquisition expense
- -
- -
- -
125
Add: Office space reduction and severance costs
336
- -
457
- -
Subtract: provision for income taxes associated with non-GAAP
adjustments
(2,490
)
- -
(3,527
)
(28
)
Net Income, core bank operating earnings (non-GAAP)
$
3,760
$
4,903
$
16,329
$
25,081
Earnings per share - basic (non-GAAP core bank operating
earnings)(5)
$
0.21
$
0.28
$
0.92
$
1.44
Earnings per share - diluted (non-GAAP core bank operating
earnings)(5)
$
0.21
$
0.27
$
0.90
1.36
Return on average assets (non-GAAP core bank operating earnings)
0.68
%
0.89
%
0.72
%
1.18
%
Return on average equity (non-GAAP core bank operating earnings)
7.06
%
9.87
%
7.78
%
12.39
%
Efficiency ratio (non-GAAP core bank operating earnings) (3)
65.77
%
57.99
%
63.96
%
50.43
%
Capital Ratios - Bank Tangible common equity (to tangible
assets)
10.12
%
8.86
%
Total risk-based capital (to risk weighted assets)
13.83
%
13.28
%
Common equity tier 1 capital (to risk weighted assets)
12.80
%
12.45
%
Tier 1 leverage (to average assets)
10.77
%
10.75
%
Asset Quality Nonperforming loans and loans 90+ past due
$
1,829
$
4,493
Nonperforming loans and loans 90+ past due to total assets
0.08
%
0.19
%
Nonperforming assets to total assets
0.08
%
0.19
%
Allowance for credit losses and unfunded commitments to loans
1.06
%
0.87
%
Allowance for credit losses to nonperforming loans
1,064.70
%
357.00
%
Net charge-offs (recoveries)
$
49
$
2
$
375
$
417
Net charge-offs (recoveries) to average loans
(2)
0.01
%
0.00
%
0.02
%
0.03
%
Selected Average Balances Total assets
$
2,210,366
$
2,202,407
$
2,272,594
$
2,125,066
Total earning assets
2,123,455
2,126,032
2,186,467
2,044,618
Total loans, net of deferred fees
1,825,472
1,745,226
1,848,308
1,608,965
Total deposits
1,836,826
1,811,098
1,915,032
1,807,693
Other Data Noninterest-bearing deposits
$
396,724
$
438,269
Interest-bearing checking, savings and money market
896,969
883,480
Time deposits
306,349
260,421
Wholesale deposits
245,250
247,992
(1) Non-GAAP Reconciliation At or For the Three
Months Ended, (Dollars in thousands, except per share data)
12/31/2023 12/31/2022 Total stockholders’
equity
$
217,117
$
202,382
Less: goodwill and intangibles, net
(7,585
)
(7,790
)
Tangible Common Equity
$
209,532
$
194,592
Less: Accumulated Other Comprehensive Income (Loss) ("AOCI")
(24,160
)
(36,568
)
Tangible Common Equity excluding AOCI
$
233,692
$
231,160
Book value per common share (5)
$
12.19
$
11.58
Less: intangible book value per common share (5)
(0.42
)
(0.44
)
Tangible book value per common share (5)
$
11.77
$
11.14
Add: AOCI (loss) per common share (5)
(1.35
)
(2.09
)
Tangible book value per common share, excluding AOCI (5)
$
13.12
$
13.23
(2) Annualized. (3) Efficiency ratio is calculated as
noninterest expense divided by the sum of net interest income and
noninterest income. (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 consolidated statements of income, balance sheets or
statements of cash flows. (5) Amounts above reflect the effect of a
25% stock dividend declared on December 15, 2022 for shareholders
of record on January 9, 2023, paid on January 31, 2023.
FVCBankcorp, Inc. Summary Consolidated Statements of
Condition (Dollars in thousands) (Unaudited)
% Change % Change Current
From 12/31/2023 9/30/2023 Quarter
12/31/2022 Year Ago Cash and due from banks $
8,042
$
7,560
6.4
%
$
7,253
10.9
%
Interest-bearing deposits at other financial institutions
52,480
89,440
-41.3
%
74,300
-29.4
%
Investment securities
171,859
216,410
-20.6
%
278,333
-38.3
%
Restricted stock, at cost
9,488
7,745
22.5
%
15,612
-39.2
%
Loans, net of fees: Commercial real estate
1,091,633
1,097,726
-0.6
%
1,097,302
-0.5
%
Commercial and industrial
216,367
215,764
0.3
%
214,873
0.7
%
Commercial construction
147,998
154,559
-4.2
%
147,272
0.5
%
Consumer real estate
363,317
367,345
-1.1
%
330,635
9.9
%
Warehouse facilities
3,506
7,887
-55.6
%
42,699
-91.8
%
Consumer nonresidential
5,743
6,232
-7.8
%
7,653
-25.0
%
Total loans, net of fees
1,828,564
1,849,513
-1.1
%
1,840,434
-0.6
%
Allowance for credit losses on loans
(18,871
)
(18,849
)
0.1
%
(16,040
)
17.6
%
Loans, net
1,809,693
1,830,664
-1.1
%
1,824,394
-0.8
%
Premises and equipment, net
997
1,047
-4.8
%
1,220
-18.3
%
Goodwill and intangibles, net
7,585
7,632
-0.6
%
7,790
-2.6
%
Bank owned life insurance (BOLI)
56,823
56,438
0.7
%
55,371
2.6
%
Other assets
73,591
88,536
-16.9
%
80,049
-8.1
%
Total Assets $
2,190,558
$
2,305,472
-5.0
%
$
2,344,322
-6.6
%
Deposits: Noninterest-bearing $
396,724
$
427,036
-7.1
%
$
438,269
-9.5
%
Interest checking
576,471
651,064
-11.5
%
578,340
-0.3
%
Savings and money market
320,498
253,575
26.4
%
305,140
5.0
%
Time deposits
306,349
381,770
-19.8
%
260,421
17.6
%
Wholesale deposits
245,250
282,526
-13.2
%
247,992
-1.1
%
Total deposits
1,845,292
1,995,971
-7.5
%
1,830,162
0.8
%
Other borrowed funds
85,000
50,000
70.0
%
265,000
-67.9
%
Subordinated notes, net of issuance costs
19,620
19,606
0.1
%
19,565
0.3
%
Reserve for unfunded commitments
602
673
-10.5
%
- -
100.0
%
Other liabilities
22,927
27,976
-18.0
%
27,213
-15.7
%
Stockholders’ equity
217,117
211,246
2.8
%
202,382
7.3
%
Total Liabilities & Stockholders' Equity $
2,190,558
$
2,305,472
-5.0
%
$
2,344,322
-6.6
%
FVCBankcorp, Inc. Summary Consolidated Statements
of Operations (Dollars in thousands, except per share
data) (Unaudited) For the Three Months
Ended % Change % Change Current
From 12/31/2023 9/30/2023 Quarter
12/31/2022 Year Ago Net interest income $
12,659
$
13,335
-5.1
%
$
15,879
-20.3
%
Provision for (reversal of) credit losses
-
(729
)
100.0
%
729
-100.0
%
Net interest income after provision for (reversal of) credit losses
12,659
14,064
-10.0
%
15,150
-16.4
%
Noninterest income (loss): Fees on loans
35
107
-66.8
%
74
-52.2
%
Service charges on deposit accounts
296
284
4.3
%
248
19.5
%
BOLI income
385
373
3.2
%
356
8.0
%
Income (Loss) from minority membership interest
321
(650
)
-149.4
%
(787
)
-140.8
%
Loss on sale of available-for-sale investment securities
(10,985
)
- -
100.0
%
- -
0.0
%
Other fee income
89
111
-19.9
%
99
-10.0
%
Total noninterest income (loss)
(9,859
)
225
-4,485.7
%
(10
)
98,489.3
%
Noninterest expense: Salaries and employee benefits
5,269
5,267
0.0
%
5,223
0.9
%
Occupancy expense
572
547
4.6
%
620
-7.7
%
Internet banking and software expense
701
660
6.3
%
475
47.6
%
Data processing and network administration
634
601
5.6
%
615
3.2
%
State franchise taxes
584
584
0.0
%
509
14.8
%
Professional fees
213
213
0.4
%
325
-34.3
%
Office space reduction costs
273
-
100.0
%
-
100.0
%
Other operating expense
1,156
1,176
-1.9
%
1,435
-19.6
%
Total noninterest expense
9,402
9,048
3.9
%
9,202
2.2
%
Net income (loss) before income taxes
(6,602
)
5,241
-226.0
%
5,938
-211.2
%
Income tax expense (benefit)
(1,531
)
1,202
-227.4
%
1,035
-247.9
%
Net income (loss) $
(5,071
)
$
4,039
-225.5
%
$
4,903
-203.4
%
Earnings (loss) per share - basic (1) $
(0.28
)
$
0.23
-225.5
%
$
0.28
-201.6
%
Earnings (loss) per share - diluted (1) $
(0.28
)
$
0.22
-225.4
%
$
0.27
-204.5
%
Weighted-average common shares outstanding - basic (1)
17,802,810
17,800,108
17,485,715
Weighted-average common shares outstanding - diluted (1)
18,295,894
18,274,432
18,489,595
Reconciliation of Net Income (GAAP)
to Commercial Bank Operating Earnings (Non-GAAP): GAAP
net income reported above $
(5,071
)
$
4,039
$
4,903
Add: Loss on sale of available-for-sale investment securities
10,985
- -
- -
Add: Office space reduction and severance costs
336
- -
- -
Subtract: provision for income taxes associated with non-GAAP
adjustments
(2,490
)
- -
- -
Net Income, Operating earnings (non-GAAP) $
3,760
$
4,039
$
4,903
Earnings per share - basic (non-GAAP core bank operating
earnings)(1) $
0.21
$
0.23
$
0.28
Earnings per share - diluted (non-GAAP core bank operating
earnings)(1) $
0.21
$
0.22
$
0.27
Return on average assets (non-GAAP core bank operating
earnings)
0.68
%
0.70
%
0.89
%
Return on average equity (non-GAAP core bank operating earnings)
7.06
%
7.57
%
9.87
%
Efficiency ratio (non-GAAP core bank operating earnings)
65.77
%
66.73
%
57.99
%
Reconciliation of Net Income (GAAP)
to Pre-Tax Pre-Provision Operating Income (Non-GAAP):
GAAP net income reported above $
(5,071
)
$
4,039
$
4,903
Add: Provision for credit losses
- -
(729
)
729
Add: Loss on sale of investment securities
10,985
- -
- -
Add: Office space reduction and severance costs
336
(Subtract) Add: Income tax (benefit) expense
(1,531
)
1,202
1,035
Pre-tax pre-provision operating income $
4,719
$
4,512
$
6,667
Earnings per share - basic (non-GAAP pre-tax pre-provision)(1) $
0.27
$
0.25
$
0.38
Earnings per share - diluted (non-GAAP pre-tax pre-provision)(1) $
0.26
$
0.25
$
0.36
Return on average assets (non-GAAP pre-tax pre-provision)
0.85
%
0.78
%
1.21
%
Return on average equity (non-GAAP pre-tax pre-provision)
8.85
%
8.45
%
13.42
%
(1) Amounts above reflect the effect of a 25% stock dividend
declared on December 15, 2022 for shareholders of record on January
9, 2023, paid on January 31, 2023.
FVCBankcorp, Inc.
Summary Consolidated Income Statements (Dollars in
thousands, except per share data) (Unaudited)
For the Years Ended % Change From
12/31/2023 12/31/2022 Year Ago Net
interest income $
54,396
$
65,244
-16.6
%
Provision for credit losses
132
2,629
-95.0
%
Net interest income after provision for loan losses
54,264
62,615
-13.3
%
Noninterest income (loss): Fees on loans
388
232
67.2
%
Service charges on deposit accounts
1,028
954
7.7
%
BOLI income
1,452
1,200
21.0
%
Loss from minority membership interest
(1,110
)
(33
)
3,262.4
%
Loss on sale of available-for-sale investment securities
(15,577
)
- -
100.0
%
Other fee income
449
481
-6.6
%
Total noninterest income (loss)
(13,370
)
2,834
-571.7
%
Noninterest expense: Salaries and employee benefits
20,643
20,316
1.6
%
Occupancy expense
2,357
2,190
7.6
%
Internet banking and software expense
2,505
1,707
46.8
%
Data processing and network administration
2,468
2,303
7.2
%
State franchise taxes
2,338
2,036
14.8
%
Professional fees
858
1,210
-29.1
%
Merger and acquisition expense
- -
125
-100.0
%
Office space reduction costs
273
- -
100.0
%
Other operating expense
5,220
4,573
14.2
%
Total noninterest expense
36,662
34,460
6.4
%
Net income before income taxes
4,232
30,989
-86.3
%
Income tax expense
410
6,005
-93.2
%
Net Income $
3,822
$
24,984
-84.7
%
Earnings per share - basic $
0.22
$
1.43
-85.0
%
Earnings per share - diluted $
0.21
$
1.35
-84.5
%
Weighted-average common shares outstanding - basic
17,722,778
17,431,098
Weighted-average common shares outstanding - diluted
18,231,346
18,483,577
Reconciliation of Net Income (GAAP)
to Commercial Bank Operating Earnings (Non-GAAP): GAAP
net income reported above $
3,822
$
24,984
Add: Loss on sale of available-for-sale investment securities
15,577
- -
Add: Merger and acquisition expense
- -
125
Add: Office space reduction and severance costs
457
- -
Subtract: provision for income taxes associated with non-GAAP
adjustments
(3,527
)
(28
)
Net Income, Operating earnings (non-GAAP) $
16,329
$
25,081
Earnings per share - basic (non-GAAP core bank operating
earnings)(1) $
0.92
$
1.44
Earnings per share - diluted (non-GAAP core bank operating
earnings)(1) $
0.90
$
1.36
Return on average assets (non-GAAP core bank operating
earnings)
0.72
%
1.18
%
Return on average equity (non-GAAP core bank operating earnings)
7.78
%
12.39
%
Efficiency ratio (non-GAAP core bank operating earnings)
63.96
%
50.43
%
Reconciliation of Net Income
(GAAP) to Pre-Tax Pre-Provision Operating Income
(Non-GAAP): GAAP net income reported above $
3,822
$
24,984
Add: Provision for credit losses
132
2,629
Add: Loss on sale of investment securities
15,577
- -
Add: Merger and acquisition expense
- -
125
Add: Office space reduction and severance costs
457
- -
Add: Income tax expense
410
6,005
Pre-tax pre-provision operating income $
20,398
$
33,743
Earnings per share - basic (non-GAAP pre-tax pre-provision)(1) $
1.15
$
1.94
Earnings per share - diluted (non-GAAP pre-tax pre-provision)(1) $
1.12
$
1.83
Return on average assets (non-GAAP operating earnings)
0.90
%
1.59
%
Return on average equity (non-GAAP operating earnings)
9.72
%
16.66
%
(1) Amounts above reflect the effect of a 25% stock dividend
declared on December 15, 2022 for shareholders of record on January
9, 2023, paid on January 31, 2023.
FVCBankcorp, Inc.
Average Statements of Condition and Yields on Earning Assets and
Interest-Bearing Liabilities (Dollars in thousands)
(Unaudited) For the Three Months Ended
12/31/2023 9/30/2023 12/31/2022 Average
Interest Average Average Interest
Average Average Interest Average
Balance Income/Expense Yield Balance
Income/Expense Yield Balance
Income/Expense Yield Interest-earning assets:
Loans receivable, net of fees (1) Commercial real estate $
1,089,549
$
13,549
4.97
%
$
1,106,429
$
13,586
4.91
%
$
1,056,611
$
11,791
4.46
%
Commercial and industrial
206,350
3,916
7.59
%
218,815
4,071
7.44
%
189,277
3,116
6.59
%
Commercial construction
154,049
2,684
6.97
%
154,569
2,780
7.19
%
149,080
2,382
6.39
%
Consumer real estate
365,582
4,391
4.80
%
363,713
4,359
4.79
%
314,415
3,513
4.47
%
Warehouse facilities
3,903
78
8.00
%
19,944
331
6.65
%
27,380
445
6.51
%
Consumer nonresidential
6,039
130
8.62
%
5,349
116
8.67
%
8,463
183
8.66
%
Total loans
1,825,472
24,748
5.42
%
1,868,819
25,243
5.40
%
1,745,226
21,430
4.91
%
Investment securities (2)(3)
252,958
1,285
2.03
%
281,382
1,309
1.86
%
344,011
1,645
1.91
%
Interest-bearing deposits at other financial institutions
45,025
619
5.45
%
64,722
876
5.37
%
36,795
269
2.90
%
Total interest-earning assets
2,123,455
26,652
5.02
%
2,214,923
27,428
4.95
%
2,126,032
23,344
4.39
%
Non-interest earning assets: Cash and due from banks
6,195
6,721
807
Premises and equipment, net
1,041
1,083
1,284
Accrued interest and other assets
98,509
99,576
89,616
Allowance for credit losses on loans
(18,834
)
(19,432
)
(15,332
)
Total Assets $
2,210,366
$
2,302,870
$
2,202,407
Interest-bearing liabilities: Interest checking $
631,775
$
5,308
3.33
%
$
641,746
$
5,134
3.17
%
$
670,540
$
2,634
1.56
%
Savings and money market
310,199
1,715
2.82
%
240,504
1,544
2.55
%
303,137
1,150
1.51
%
Time deposits
272,784
3,579
4.15
%
359,217
3,550
3.92
%
238,795
1,267
2.11
%
Wholesale deposits
218,176
2,151
3.91
%
366,667
3,571
3.86
%
133,092
798
2.38
%
Total interest-bearing deposits
1,432,934
12,753
3.53
%
1,608,134
13,799
3.40
%
1,345,564
5,849
1.72
%
Other borrowed funds
112,935
982
3.45
%
9,141
35
1.53
%
145,424
1,356
3.70
%
Subordinated notes, net of issuance costs
19,611
257
5.21
%
19,597
258
5.21
%
19,556
257
5.23
%
Total interest-bearing liabilities
1,565,480
13,992
3.55
%
1,636,872
14,092
3.42
%
1,510,544
7,462
1.96
%
Noninterest-bearing liabilities: Noninterest-bearing
deposits
403,892
425,807
465,534
Other liabilities
27,804
26,681
27,635
Stockholders’ equity
213,190
213,510
198,694
Total Liabilities and Stockholders' Equity $
2,210,366
$
2,302,870
$
2,202,407
Net Interest Margin
12,660
2.37
%
13,336
2.39
%
15,882
2.96
%
(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 22% for the three
months ended December 31, 2023 and September 30, 2023 and 21% for
the three months ended for the December 31, 2022. The taxable
equivalent adjustment to interest income was $1 for the three
months ended December 31, 2023 and September 30, 2023. For the
three months ended December 31, 2022, the taxable equivalent
adjustment to interest income was $2 for each aforementioned
period. (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 Years Ended
2023
2022
Average Interest Average Average
Interest Average Balance Income/Expense
Yield Balance Income/Expense Yield
Interest-earning assets: Loans receivable, net of fees (1)
Commercial real estate $
1,103,325
$
53,356
4.84
%
$
978,983
$
42,646
4.36
%
Commercial and industrial
206,432
15,170
7.35
%
181,540
9,820
5.41
%
Commercial construction
154,658
10,917
7.06
%
165,088
8,762
5.31
%
Consumer real estate
358,740
17,039
4.75
%
240,055
10,079
4.20
%
Warehouse facilities
19,097
1,343
7.03
%
43,268
1,612
3.73
%
Consumer nonresidential
6,056
548
9.05
%
9,143
705
7.71
%
Total loans
1,848,308
98,373
5.32
%
1,618,077
73,624
4.55
%
Investment securities (2)(3)
287,454
5,606
1.95
%
352,064
6,382
1.81
%
Interest-bearing deposits at other financial institutions
50,705
2,641
5.21
%
74,477
685
0.92
%
Total interest-earning assets
2,186,467
106,620
4.88
%
2,044,618
80,691
3.95
%
Non-interest earning assets: Cash and due from banks
6,168
873
Premises and equipment, net
1,121
1,410
Accrued interest and other assets
97,440
92,761
Allowance for credit losses on loans
(18,602
)
(14,596
)
Total Assets $
2,272,594
$
2,125,066
Interest-bearing liabilities: Interest checking $
581,655
$
16,903
2.91
%
$
724,881
$
5,966
0.82
%
Savings and money market
254,721
6,102
2.40
%
315,653
2,662
0.84
%
Time deposits
349,270
12,791
3.66
%
203,719
2,908
1.43
%
Wholesale deposits
303,472
11,549
3.81
%
61,478
932
1.52
%
Total interest-bearing deposits
1,489,118
47,345
3.18
%
1,305,731
12,468
0.95
%
Other borrowed funds
102,050
3,844
3.77
%
70,299
1,939
2.76
%
Subordinated notes, net of issuance costs
19,590
1,030
5.26
%
19,535
1,031
5.28
%
Total interest-bearing liabilities
1,610,758
52,219
3.24
%
1,395,565
15,438
1.11
%
Noninterest-bearing liabilities: Noninterest-bearing
deposits
425,914
501,962
Other liabilities
26,013
25,059
Stockholders’ equity
209,909
202,480
Total Liabilities and Stockholders' Equity $
2,272,594
$
2,125,066
Net Interest Margin
54,401
2.49
%
65,253
3.19
%
(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 22% for
the year ended December 31, 2023 and 21% for the year ended
December 31, 2022. The taxable equivalent adjustment to interest
income was $5 and $9 for years ended December 31, 2023 and 2022,
respectively. (3) The average balances for investment securities
includes restricted stock.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240123315769/en/
David W. Pijor, Esq., 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
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