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BV Financial, Inc. Announces Financial Results

BALTIMORE, MD / ACCESSWIRE / July 18, 2024 / BV Financial, Inc. (NASDAQ:BVFL), the holding company for BayVanguard Bank (the "Bank"), today reported net income of $3.4 million, or $0.32 per diluted share, for the quarter ended June 30, 2024 compared to net income of $3.9 million, or $0.49 per diluted share, for the quarter ended June 30, 2023. Net income for the six-month period ended June 30, 2024 was $6.0 million or $0.52 per diluted share compared to net income of $7.0 million or $0.88 per diluted share for the six-month period ended June 30, 2023.

Financial Highlights

  • Return on average assets and return on average equity for the three months ended June 30, 2024 were 1.52% and 6.68%, respectively.

  • Net loans held to maturity decreased $2.4 million or 0.3% compared to December 31, 2023.

  • Deposits increased $6.2 million or 1.0% from $634.1 million at December 31, 2023 to $640.3 million at June 30, 2024.

  • Cash and cash equivalents increased by $16.9 million or 23.0% compared to December 31, 2023.

  • Non-accrual loans decreased $2.5 million or 22.0% to $8.2 million at June 30, 2024 from $10.6 million at December 31, 2023.

  • The Company recorded a recovery to the provision for credit losses of $111,000 for the three months ended June 30, 2024 and $92,000 for the six months ended June 30, 2024.

FINANCIAL CONDITION DISCUSSION

Total Assets. Total assets were $897.2 million at June 30, 2024, an increase of $11.9 million, or 1.4%, from $885.3 million at December 31, 2023. The increase was due primarily to a $16.9 million increase in cash, which was primarily offset by decreases in loans and securities.

Cash and Cash Equivalents. Cash and cash equivalents increased $16.9 million, or 23.0%, to $90.4 million at June 30, 2024 from $73.5 million at December 31, 2023. The increase in cash is a result of the increase in deposits and the decrease in other earning assets.

Loans Receivable. Loans receivable decreased $2.4 million, or 0.3%, to $702.4 million at June 30, 2024 from $704.8 million at December 31, 2023. Decreases in owner occupied commercial real estate, 1-4 family non-owner occupied loans and 1-4 family owner occupied loans offset increases non-owner occupied commercial real estate and commercial non-real estate loans.

Securities. Securities available for sale decreased by $1.9 million or 5.5% from December 31, 2023 as paydowns in the mortgage-backed securities were not replaced with new purchases. The held-to-maturity portfolio experienced a slight decrease due to paydowns.

Total Liabilities. Total liabilities increased $5.5 million or 0.8%, to $691.7 million at June 30, 2024 from $686.2 million at December 31, 2023. The increase was due primarily to the increase in interest-bearing deposits offsetting a decrease in borrowings as $3.0 million in junior subordinated debt was paid off in the first quarter of 2024.

Deposits. Total deposits increased $6.2 million, or 1.0% to $640.3 million at June 30, 2024 from $634.1 million at December 31, 2023. Interest-bearing deposits increased $7.2 million, or 1.5%, to $499.3 million at June 30, 2024 from $492.1 million at December 31, 2023. Noninterest bearing deposits decreased $1.0 million, or 0.7%, to $141.0 million at June 30, 2024 from $142.0 million at December 31, 2023.

Stockholders' Equity. Stockholders' equity increased $6.4 million, or 3.2%, to $205.5 million at June 30, 2024 from $199.1 million at December 31, 2023 primarily due to net income during the period.

RESULTS OF OPERATION DISCUSSION

Net Income. Net income was $3.4 million or $0.32 per diluted share for the three months ended June 30, 2024 compared to $3.9 million or $0.49 per diluted share for the three months ended June 30, 2023. In the three months ended June 30, 2023, the Company recognized a gain on the sale of foreclosed real estate of $678,000. Net income was $6.0 million or $0.52 per diluted share for the six months ended June 30, 2024 compared to $7.0 million or $0.88 per diluted share for the six months ended June 30, 2023. In the six months ended June 30, 2023, the Company recognized a gain on the sale of foreclosed real estate of $678,000 and received $225,000 in life insurance proceeds.

Net Interest Income. Net interest income was $8.9 million for the three months ended June 30, 2024 compared to $8.2 million in the three months ended June 30, 2023.The net interest margin for the three months ended June 30, 2024 was 4.33% compared to 4.19% for the three months ended June 30, 2023. The increase in net interest income was due to higher average balances of interest earning assets and higher yields on these assets offsetting the increase in interest expense due to higher rates paid on deposits.

Net interest income was $16.9 million for the six months ended June 30, 2024, compared to $16.4 million in the six months ended June 30, 2023. The net interest margin for the six months ended June 30, 2024 was 4.12% compared to 4.26% for the six months ended June 30, 2023. The increase in net interest income was due to higher average balances of interest earning assets and higher yields on these assets offsetting the increase in interest expense due to higher rates paid on deposits.

Noninterest Income. For the three months ended June 30, 2024, noninterest income totaled approximately $600,000 compared to $1.4 million for the quarter ended June 30, 2023. For the quarter ended June 30, 2023, the Company recognized a gain of $678,000 on the sale of foreclosed real estate.

For the six months ended June 30, 2024, noninterest income totaled $1.2 million as compared to $2.2 million for the six months ended June 30, 2023. In the six-months ended June 30, 2023, the Company recognized a gain of $678,000 on the sale of foreclosed real estate and $225,000 in life insurance proceeds.

Noninterest Expense. For the three months ended June 30, 2024, noninterest expense totaled $4.9 million compared to $4.5 million in the three months ended June 30, 2023. Increases in compensation and benefits increased $232,000 or 8.1% due to increases in salary and benefits, occupancy expense increased by $43,000 or 11.7% due to higher rent and maintenance expenses, data processing expense increased by $34,000 or 10.0% due to annual increases and project expenses and professional fees increased due to price increases and the costs of being a public company.

For the six months ended June 30, 2024, noninterest expense totaled $9.8 million as compared to $9.2 million in the six months ended June 30, 2023. Increases in compensation and benefits increased $482,000 or 8.4% due to increases in staffing and salaries and benefits, occupancy expense increased by $65,000 or 8.3% due to higher rent and maintenance expenses, data processing expense increased by $62,000 or 9.0% due to annual increases and project expenses.

Asset Quality. Non-performing assets at June 30, 2024 totaled $8.4 million consisting of $8.2 million in nonperforming loans and $170,000 in other real estate owned, compared to $10.9 million at December 31, 2023, consisting of $10.7 million in non-performing loans and $170,000 in other real estate owned. During the quarter, our largest loan on non-accrual, a $6.8 million investor commercial real estate loan, was reduced by a $3.0 million cash payment. In July, the remaining $3.8 million balance paid off. At June 30, 2024, the allowance for credit losses on loans was $8.5 million, which represented 1.22% of total loans and 103.9% of non-performing loans compared to $8.5 million at December 31, 2023, which represented 1.21% of total loans and 81.0% of non-performing loans.

Forward-Looking Statements

This press release may contain certain forward-looking statements that are based on management's current expectations regarding economic, legislative and regulatory issues that may impact the Company's earnings in future periods. Factors that could cause future results to vary materially from current management expectations include, but are not limited to, general economic conditions, changes in interest rates, increased competitive pressures, the effects of inflation, potential recessionary conditions, general economic conditions or conditions within the securities markets, monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Board of Governors of the FRB, changes in the quality, size and composition of our loan and securities portfolios, changes in liquidity, including the size and composition of our deposit portfolio and the percentage of uninsured deposits in the portfolio, changes in demand for our products and services, accounting and tax changes, deposit flows, real estate values and competition, changes in accounting and tax principles, policies or guidelines, changes in legislation or regulation and other economic, competitive, governmental, regulatory and technological factors affecting the Company's operations, pricing, products and services, a failure in or breach of our operational or security systems or infrastructure, including cyberattacks that could adversely affect the Company's financial condition and results of operations and the business in which the Company and the Bank are engaged and the failure to maintain current technologies, the failure to retain or attract employees.

BV Financial, Inc. is the parent company of BayVanguard Bank. BayVanguard Bank is headquartered in Baltimore, Maryland with fifteen branches in the Baltimore metropolitan area and the eastern shore of Maryland. The Bank is a full-service community-oriented financial institution dedicated to serving the financial service needs of consumers and businesses.

At or For the Three Months

At or For the Six Months

Ended June 30,

Ended June 30,

2024

2023

2024

2023

Performance Ratios(1):

Return on average assets

1.52

%

1.78

%

1.34

%

1.62

%

Return on average equity

6.68

%

15.24

%

5.92

%

13.90

%

Interest rate spread(2)

3.61

%

3.77

%

3.36

%

3.92

%

Net interest margin(3)

4.33

%

4.19

%

4.12

%

4.26

%

Non-interest expense to average assets

2.19

%

2.07

%

2.21

%

2.14

%

Efficiency ratio(4)

51.53

%

46.57

%

54.42

%

49.27

%

Average interest-earning assets to average interest-bearing liabilities

154.65

%

135.48

%

154.62

%

135.05

%

Average equity to average assets

22.73

%

11.68

%

22.68

%

11.67

%

Credit Quality Ratios:

Allowance for credit losses as a percentage of total loans

1.22

%

1.16

%

1.22

%

1.16

%

Allowance for credit losses as a percentage of non-performing loans

103.88

%

179.14

%

103.88

%

179.14

%

Net charge-offs (recoveries) to average outstanding loans during the year

-0.01

%

-0.01

%

-0.02

%

-0.02

%

Non-performing loans as a percentage of total loans

1.17

%

0.65

%

1.17

%

0.65

%

Non-performing loans as a percentage of total assets

0.92

%

0.50

%

0.92

%

0.50

%

Total non-performing assets as a percentage of total assets

0.94

%

0.56

%

0.94

%

0.56

%

Other:

Number of offices

13

15

13

15

Number of full-time equivalent employees

116

117

116

117

(1)

Performance ratios are annualized.

(2)

Represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

(3)

Represents net interest income as a percentage of average interest-earning assets.

(4)

Represents non-interest expenses divided by the sum of net interest income and non-interest income.

BV FINANCIAL, INC.
Consolidated Balance Sheets

June 30, 2024

December 31, 2023

(dollars in thousands, except share amounts)

(unaudited)

Assets

Cash

$

9,334

$

9,260

Interest-bearing deposits in other banks

81,305

64,482

Cash and cash equivalents

90,639

73,742

Equity Investment

236

256

Securities available for sale

32,868

34,781

Securities held to maturity (fair value of $9,051 and $9,206, ACL of $5 and $6)

10,089

10,209

Loans held to maturity

702,373

704,802

Allowance for Credit Losses

(8,547

)

(8,554

)

Net Loans

693,826

696,248

Foreclosed real estate

170

170

Premises and equipment, net

13,503

14,250

Federal Home Loan Bank of Atlanta stock, at cost

654

626

Investment in life insurance

19,856

19,657

Accrued interest receivable

3,344

3,279

Goodwill

14,420

14,420

Intangible assets, net

922

1,012

Deferred tax assets, net

8,810

8,969

Other assets

7,825

7,635

Total assets

$

897,162

$

885,254

Liabilities and Stockholders' Equity

Liabilities

Noninterest-bearing deposits

$

141,040

$

142,030

Interest-bearing deposits

499,260

492,090

Total deposits

640,300

634,120

FHLB borrowings

-

-

Subordinated Debentures

34,806

37,251

Other liabilities

16,584

14,818

Total liabilities

691,690

686,189

Stockholders' equity

Preferred stock, $0.01 par value; 1,000,000 shares authorized; none issued or outstanding

-

-

Common stock, $0.01 par value; 45,000,000 shares authorized at June 30, 2024 and December 31, 2023; 11,387,723 shares issued and outstanding as of June 30, 2024 and 11,375,803 shares issued and outstanding as of December 31, 2023

114

114

Paid-in capital

110,694

110,465

Unearned common stock held by employee stock ownership plan

(7,244

)

(7,328

)

Retained earnings

103,745

97,772

Accumulated other comprehensive loss

(1,837

)

(1,958

)

Total stockholders' equity

205,472

199,065

Total liabilities and stockholders' equity

$

897,162

$

885,254

BV FINANCIAL, INC.
Consolidated Statements of Income

(dollars in thousands, except per share amounts)

Three Months Ended June 30,

Six Months Ended June 30,

Interest Income

2024

2023

2024

2023

Loans, including fees

$

10,177

$

9,327

$

19,959

$

18,100

Investment securities available for sale

306

277

612

543

Investment securities held to maturity

91

92

183

186

Other interest income

1,043

843

1,867

1,398

Total interest income

11,617

10,539

22,621

20,227

Interest Expense

Interest on deposits

2,242

1,266

4,228

1,931

Interest on FHLB borrowings

-

495

-

783

Interest on Subordinated debentures

466

541

1,521

1,075

Total interest expense

2,708

2,302

5,749

3,789

Net interest income

8,909

8,237

16,872

16,438

Provision for (recovery of) credit losses

(111

)

(150

)

(92

)

(147

)

Net interest income after provision for (recovery of) credit losses

9,020

8,387

16,964

16,585

Noninterest Income

Service fees on deposits

97

101

200

195

Fees from debit cards

182

188

354

360

Income from investment in life insurance

112

145

199

464

Gain on sale of foreclosed real estate

-

678

-

678

Other income

205

258

421

481

Total noninterest income

596

1,370

1,174

2,178

Noninterest Expense

Compensation and related benefits

3,091

2,859

6,220

5,738

Occupancy

409

366

847

782

Data processing

374

340

751

689

Advertising

6

14

11

28

Professional fees

244

176

356

376

Equipment

103

108

205

213

Foreclosed real estate holding costs

11

32

16

159

Amortization of intangible assets

45

46

90

92

FDIC insurance premiums

81

64

164

118

Other expense

533

539

1,160

1,049

Total noninterest expense

4,897

4,544

9,820

9,244

Net income before tax

4,719

5,213

8,318

9,519

Income tax expense

1,320

1,314

2,345

2,505

Net income

$

3,399

$

3,899

$

5,973

$

7,014

Basic earnings per share

$

0.32

$

0.49

$

0.52

$

0.88

Diluted earnings per share

$

0.32

$

0.49

$

0.52

$

0.88

BV FINANCIAL, INC.
Average Balance Sheet for the Quarters ended June 30,
(Dollars in thousands)

For the Three Months Ended June 30,

2024

2023

(dollars in thousands)

Average Outstanding Balance

Interest

Average Yield/Rate

Average Outstanding Balance

Interest

Average Yield/Rate

(Unaudited)

Interest-earning assets:

Loans

$

705,516

$

10,177

5.79

%

$

679,179

$

9,327

5.51

%

Securities available-for-sale

33,445

306

3.67

%

35,240

277

3.15

%

Securities held-to-maturity

10,777

91

3.39

%

12,415

92

2.99

%

Cash, cash equivalents and other interest-earning assets

75,031

1,043

5.59

%

61,780

843

5.49

%

Total interest-earning assets

824,769

11,617

5.65

%

788,614

10,539

5.36

%

Noninterest-earning assets

67,088

87,991

Total assets

$

891,857

$

876,605


Interest-bearing liabilities:

Interest-bearing demand deposits

$

86,892

237

1.09

%

$

87,647

143

0.65

%

Savings deposits

139,980

96

0.28

%

159,790

52

0.13

%

Money market deposits

93,787

475

2.03

%

91,957

140

0.61

%

Certificates of deposit

177,859

1,434

3.23

%

168,064

931

2.22

%

Total interest-bearing deposits

498,518

2,242

1.80

%

507,458

1,266

1.00

%

Federal Home Loan Bank advances

-

-

-

37,500

495

5.29

%

Subordinated debentures

34,789

466

5.36

%

37,122

541

5.85

%

Total borrowings

34,789

466

5.37

%

74,622

1,036

5.57

%

Total interest-bearing
liabilities

533,307

2,708

2.04

%

582,080

2,302

1.59

%

Noninterest-bearing demand deposits

139,070

149,444

Other noninterest-bearing liabilities

16,627

42,715

Total liabilities

689,004

774,239

Equity

202,853

102,366

Total liabilities and equity

$

891,857

$

876,605

Net interest income

$

8,909

$

8,237

Net interest rate spread

3.61

%

3.77

%

Net interest-earning assets

$

291,462

$

206,534

Net interest margin

4.33

%

4.19

%

Average interest-earning assets to interest-bearing liabilities

154.65

%

135.48

%

BV FINANCIAL, INC.
Average Balance Sheet for the Six Months ended June 30
(Dollars in thousands)

For the Six Months Ended June 30,

2024

2023

(dollars in thousands)

Average Outstanding Balance

Interest

Average Yield/Rate

Average Outstanding Balance

Interest

Average Yield/Rate

(Unaudited)

Interest-earning assets:

Loans

$

706,942

$

19,959

5.54

%

$

673,564

$

18,100

5.42

%

Securities available-for-sale

33,745

612

3.61

%

35,685

543

3.07

%

Securities held-to-maturity

10,796

183

3.41

%

12,166

186

3.08

%

Cash, cash equivalents and other interest-earning assets

68,856

1,867

5.28

%

56,362

1,398

5.02

%

Total interest-earning assets

820,339

22,621

5.41

%

777,777

20,227

5.24

%

Noninterest-earning assets

67,273

87,176

Total assets

$

887,612

$

864,953

Interest-bearing liabilities:

Interest-bearing demand deposits

$

85,721

473

1.12

%

$

89,733

161

0.36

%

Savings deposits

143,304

161

0.18

%

162,290

92

0.11

%

Money market deposits

90,762

827

1.61

%

95,749

236

0.50

%

Certificates of deposit

175,477

2,767

3.09

%

160,207

1,441

1.81

%

Total interest-bearing deposits

495,264

4,228

1.62

%

507,979

1,930

0.77

%

Federal Home Loan Bank advances

-

-

-

30,862

783

5.12

%

Subordinated debentures

35,297

1,521

11.82

%

37,096

1,076

5.85

%

Total borrowings

35,297

1,521

11.82

%

67,958

1,859

5.52

%

Total interest-bearing
liabilities

530,561

5,749

2.31

%

575,937

3,789

1.33

%

Noninterest-bearing demand deposits

139,381

154,521

Other noninterest-bearing liabilities

16,384

33,598

Total liabilities

686,326

764,056

Equity

201,286

100,897

Total liabilities and equity

$

887,612

$

864,953

Net interest income

$

16,872

$

16,438

Net interest rate spread

3.36

%

3.92

%

Net interest-earning assets

$

289,778

$

201,840

Net interest margin

4.12

%

4.26

%

Average interest-earning assets to interest-bearing liabilities

154.62

%

135.05

%

ALLOWANCE FOR CREDIT LOSS - LOANS
(Dollars in thousands)

QTR

YTD

6/30/2024

6/30/2024

Beginning Balance

$

8,506

$

8,554

Provision for credit losses -loans

(25

)

(159

)

Net Charge-offs (recoveries):

Owner Occupied 1-4

(56

)

(108

)

Non-Owner Occupied 1-4

(11

)

(39

)

Investor Commercial Real Estate

-

(2

)

OO Commercial Real Estate

-

(2

)

Construction & Land

(1

)

(2

)

Farm Loans

-

-

Marine & Consumer

2

1

Guaranteed by the US Gov't

-

-

Commercial

-

-

Net charge-offs (recoveries)

(66

)

(152

)

Ending Balance- ACL for Loans

$

8,547

$

8,547

Balance Reserve for unfunded loan commitments

275

275

Balance Reserve for HTM Securities

5

5

Total ACL

$

8,827

$

8,827

Provision expense for Unfunded Commitments

(85

)

68

Provision expense for HTM Securities

(1

)

(1

)

Total other provision expense

$

(86

)

$

67

Total provision for (recovery of )credit losses

$

(111

)

$

(92

)

Contact:

Michael J. Dee
Chief Financial Officer
(410) 477- 5000

SOURCE: BV Financial, Inc.



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