Oak Valley Bancorp, the bank holding company for Oak Valley Community Bank and its Eastern Sierra Community Bank division, recently reported unaudited consolidated financial results. For the three months ended June 30, 2024, consolidated net income was $5,889,000, or $0.71 per diluted share (EPS), as compared to $5,727,000, or $0.69 EPS, for the prior quarter and $8,404,000, or $1.02 EPS, for the same period a year ago. Consolidated net income for the six months ended June 30, 2024 was $11,616,000, or $1.41 EPS, compared to $17,629,000 or $2.14 EPS for the same period of 2023.
The increase in second quarter net income compared to the prior quarter was due to growth in the deposit and loan portfolios, and an increase in non-interest income. The QTD and YTD decreases compared to the same periods of 2023 were related to an increase in deposit interest expense and general operating expenses.
Net interest income for the three months ended June 30, 2024 was $17,292,000, compared to $17,241,000 in the prior quarter, and $19,407,000 in the same period a year ago. The increase in net interest income over the prior quarter is attributed to loan growth and an increase of six basis points in the average earning asset yield. The decrease from the same period a year ago is due to an increase in the average cost of funds to 73 bps for the second quarter of 2024, compared to 16 bps for the comparable period of 2023. The higher interest expense was partially offset by loan growth of $119.5 million over the same period. Net interest margin for the three months ended June 30, 2024 was 4.11 percent, compared to 4.09 percent for the prior quarter and 4.45 percent for the same period last year.
“Our earnings performance reflects our consistent and prudent approach to managing our business. We continue to focus on relationship-based core deposit growth which enables us to maintain our lending activity and enhance profitability,” stated Rick McCarty, President and Chief Operating Officer.
The Board of Directors of Oak Valley Bancorp at their July 16, 2024, meeting declared the payment of a cash dividend of $0.225 per share of common stock to its shareholders of record at the close of business on July 29, 2024. The payment date will be Aug. 9, 2024 and will amount to approximately $1,881,000. This is the second dividend payment made by the Company in 2024. Oak Valley Bancorp operates Oak Valley Community Bank and their Eastern Sierra Community Bank division, through which it offers a variety of loan and deposit products to individuals and small businesses. They currently operate through 18 branches: Oakdale, Turlock, Stockton, Patterson, Ripon, Escalon, Manteca, Tracy, Sacramento, Roseville, two branches in Sonora, three branches in Modesto, and three branches in their Eastern Sierra division, which includes Bridgeport, Mammoth Lakes, and Bishop. For more information, call 1-866-844-7500 or visit www.ovcb.com.
Non-interest income was $1,760,000 for the quarter ended June 30, 2024, compared to $1,519,000 for the prior quarter and $1,655,000 for the same period last year. The increases compared to prior periods was mainly due to increased production from the bank’s investment advisory service and related fee income.
Non-interest expense totaled $11,616,000 for the quarter ended June 30, 2024, compared to $11,529,000 in the prior quarter and $10,062,000 in the same quarter a year ago. The second quarter increase compared to prior periods is due to general operating costs related to servicing the growing loan and deposit portfolios. Total assets were $1.84 billion at June 30, 2024, an increase of $34.1 million over March 31, 2024 and a decrease of $21.2 million from June 30, 2023. Gross loans were $1.07 billion at June 30, 2024, an increase of $30.5 million over March 31, 2024 and $119.5 million over June 30, 2023. The Company’s total deposits were $1.64 billion as of June 30, 2024, an increase of $32.3 million over March 31, 2024 and a decrease of $37.6 million from June 30, 2023. The deposit increase during the second quarter was due in part to an increase in new checking accounts and their corresponding balances resulting from the new checking acquisition program launched by the bank in January 2024. The deposit decrease compared to the same period a year ago was due to the migration of rate-sensitive deposits, prior to the bank making deposit rate increases in July 2023. The bank’s liquidity position remains strong, as evidenced by $180.3 million in cash and cash equivalents balances at June 30, 2024.
“We are pleased to report another strong financial performance and solid earnings for the quarter. We have achieved steady growth, driven by our ability to meet the needs of our customers and communities,” stated Chris Courtney, CEO. “We appreciate the dedication and professionalism of our team members who deliver excellent service to our clients every day.”
