Pacific Valley Bank (OTCQB: PVBK) announced its unaudited second quarter 2018 net income of $557,289 or $0.14 basic earnings per share (adjusted for stock dividend). Net earnings more than doubled when compared to the same quarter of 2017 when the Bank reported net income of $200,255 or $0.05 basic earnings per share. Net income for the first half of 2018 was $1,027,217 or $0.26 basic earnings per share, as compared to the first half of 2017 with a reported $436,169, or $0.11 basic earnings per share. On July 10, a stock dividend was announced, notifying investors that a 10% stock dividend would be distributed to our shareholders on July 31, 2018, in recognition of our earnings over the past year and a half, and to honor the loyal support of our shareholders. Consequently, per share amounts for all periods presented have been retroactively adjusted for the effect of the dividend.

Second Quarter 2018 Financial Highlights (annualized)
Return on Average Assets (ROAA): 0.84%
Net Interest Margin (NIM): 4.30%
Efficiency Ratio: 72.60%
Loan balances were at an all-time high of $228.3 million

First Half 2018 Financial Highlights (annualized)
Return on Average Assets (ROAA): 0.78%
Net Interest Margin (NIM): 4.24%
Efficiency Ratio: 74.33%

“The first half of 2018 has provided the Bank with unprecedented growth in the loan portfolio, and the increase in net income is outperforming 2017. Net Income has increased 136% compared to the first half of 2017”, stated Anker Fanoe, President and Chief Executive Officer. He continued, “We have been strategically investing in our people and processes this year, focusing on enhancing customer engagement. Thus far, the outcomes have exceeded our expectations. The momentum we are seeing is reflected in the positive growth of the Bank.”

Total assets were $267.7 million, as of June 30, 2018. This represents a net growth of $6.5 million over the same period last year. Asset quality continues to improve and as of June 30, 2018, non-performing assets accounted for less than 1% of the Bank’s total assets.

Loans Outstanding at June 30, 2018, totaled $228.3 million, an increase of $45.8 million or 25% over June 30, 2017. Nonaccrual loan balances totaled $556 thousand versus $3.5 million reported at June 30, 2017. At June 30, 2018, the Bank’s Allowance for Loan Losses (ALLL) was $4.3 million or 2% of loans outstanding. The ALLL increased 25% between this year and last year due to recoveries received on previously charged off loans. There have not been any loans charged off in 2018.

As of June 30, 2018, Total Deposits finished at $219.7 million, down from $230.8 million, as of the same period last year. This represents a 5% decrease and is consistent with deposit activity associated with seasonal cycle of the Bank’s agricultural depositors. Historically, deposits have flowed out of the Bank in the early part of the year, and inflow back into the Bank in the second half of the year as payments are received.

Shareholder’s Equity continues to be strong and the Bank’s capital ratios well exceed regulatory capital ratio minimums. In accordance with regulatory guidelines, the Bank is considered to be well-capitalized. As of June 30, 2018, Total Capital was $31.5 million, versus $29.3 million reported for June 2017, an increase of $2.1 million. The Bank has the necessary capital to continue the support of the Bank’s strategic loan growth.

Capital Ratios, as reported in the June 30, 2018 Call Report:

Leverage Ratio 11.74%
Tier 1 Capital Ratio 13.65%
Total Capital Ratio 14.91%

At June 30, 2018, Net Interest Income was $5.3 million for the first half of 2018, representing an increase of 16% increase year over year. This increase can be attributed to the significant loan growth the Bank has experienced within the past year. In the first half of 2018, Non-Interest Income totaled $277.5 thousand, outpacing the same time frame last year by 8%. Operating Expenses increased a negligible 1% over the same period last year.

Pacific Valley Bank is a full service business bank that commenced operations in September 2004 to provide exceptional service to customers in Monterey County. Pacific Valley Bank operates business at three locations; administrative headquarters and branch offices in Salinas, King City and Monterey, California. The Bank offers a broad range of banking products and services, including credit and deposit services to small and medium sized businesses, agriculture related businesses, non-profit organizations, professional service providers and individuals. For more information, visit
This release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results, performance and/or achievements to differ materially from those projected. Accordingly, readers should not place undue reliance on these forward-looking statement. These risks and uncertainties include, but are not limited to, economic conditions in all areas in which the Bank conducts business, including the competitive environment for attracting loans and deposits; supply and demand for real estate and periodic deterioration in real estate prices and/or values in California or other states where we lend; changes in the financial performance and/or condition of our borrowers, depositors, key vendors or counterparties; changes in our levels of delinquent loans, nonperforming assets, allowance for loan losses and charge-offs; the effect of changes in laws and regulations, including accounting practices; changes in estimates of future reserve requirements and minimum capital requirements based upon periodic review thereof under relevant regulatory and accounting requirements; fluctuations in the interest rate and market environment; cyber-security threats, including the loss of system functionality, theft, loss of customer data or money; technological changes and he expanding use of technology in banking; the costs and effects of legal, compliance and regulatory actions; acts of war or terrorism, or natural disasters; and other factors beyond the Bank’s control. These forward-looking statements, which reflect management’s views, are as of the date of this release. Pacific Valley Bank has no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

Anker Fanoe, Chief Executive Officer (831) 771-4384

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