Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil Hydroworld Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries MVB Financial Corp. Announces First Quarter 2024 Results By: MVB Financial Corp. via Business Wire April 29, 2024 at 16:30 PM EDT MVB Financial Corp. (NASDAQ: MVBF) (“MVB Financial,” “MVB” or the “Company”), the holding company for MVB Bank, Inc. ("MVB Bank"), today announced financial results for the first quarter of 2024, with reported net income of $4.5 million, or $0.35 basic and $0.34 diluted earnings per share. First Quarter 2024 Highlights As Compared to Fourth Quarter 2023 Total revenue increased 6.8%, or $2.4 million. Fintech fee income grew 26.3%, or $1.0 million. Noninterest bearing deposits increased 16.2%, or $193.8 million, and represent 44% of total deposits. Nonperforming loans declined 8.7%; Measures of asset quality and capital strength were stable. Book value per share and tangible book value per share, a non-GAAP financial measure, each increased by 0.2% to $22.73 and $22.48, respectively. From Larry F. Mazza, Chief Executive Officer, MVB Financial: “Turbulence in financial markets and the banking sector persisted during the first quarter of 2024. Amidst these volatile market conditions, MVB made progress on several key initiatives. Most notably, we further solidified foundational measures of safety and soundness. Our balance sheet liquidity position and the quality of our funding mix improved, asset quality indicators were stable, commercial real estate concentrations remained well within regulatory guidelines and measures of capital strength were maintained. We also remained proactive in investing at a higher-than-normal pace to contend with changing regulatory requirements following the industry events of early 2023. These higher costs, alongside other cyclical and seasonal challenges, weighed on our earnings for the first quarter. “At the same time, initiatives to drive revenue growth are bearing fruit. Banking-as-a-service fee income increased from the prior quarter and the year-ago period, benefiting from seasonal considerations, notably the influence of tax season, and growth in the underlying business. Through these challenging times for the banking sector, I’m pleased and encouraged by the adaptability of the MVB Team and the resilience of our business model.” FIRST QUARTER 2024 HIGHLIGHTS Strong core deposit growth. Total deposits increased 8.4%, or $243.9 million, to $3.15 billion, compared to the prior quarter-end, primarily reflecting strong growth in noninterest bearing (“NIB”) deposits. Growth also reflected strength in Banking-as-a-Service (“BaaS”) deposits and increased balances due to seasonal tax volume and deposits tied to payment relationships. Total off-balance sheet deposits increased to $1.53 billion as compared to $1.09 billion at the prior quarter-end. Off-balance sheet deposit networks are utilized to generate fee income, enhance capital efficiency and manage liquidity and concentration risk. NIB deposits increased 16.2%, or $193.8 million, and 22.6%, or $256.8 million, to $1.39 billion, as compared to the prior quarter-end and the year-ago period, respectively. NIB deposit growth relative to the prior quarter primarily reflected seasonal tax deposits and growth in customer business volume. NIB deposits represented 44.2% of total deposits, as compared to 41.3% of total deposits at the prior quarter-end, and 36.0% for the year-ago period. Certificate of deposit (“CD”) balances, which include brokered deposits, increased 18.7%, or $109.5 million, to $696.3 million, from the prior quarter-end. The loan-to-deposit ratio was 72.1% as of March 31, 2024, compared to 79.9% as of December 31, 2023 and 74.9% as of March 31, 2023. The decline in the loan-to-deposit ratio reflects the increase in deposits, primarily due to our BaaS business, combined with a decline in loan balances driven by market conditions. Fintech fee income growth drove quarter and year-over-year growth in noninterest income and total revenues. Payment card and service charge income, which includes BaaS fee income, increased by 26.3% and 33.3% as compared to the prior quarter and the year-ago period, respectively. Growth relative to the prior quarter primarily related to increased transactional volume due to seasonal tax deposits and expanded relationships with our Fintech partners. Growth relative to the prior year is primarily related to the increased transactional volume from seasonal tax deposits year over year. Total noninterest income grew 76.5%, or $3.4 million, relative to the prior quarter, to $7.8 million, primarily reflecting higher payment card and service charge income and a decline in the loss on equity method investments (mortgage banking). Relative to the prior year, total noninterest income grew 155.4%, or $4.8 million, reflecting higher payment card and service charge income and higher other operating income. Total revenues increased $2.4 million, or 6.8%, and $2.2 million, or 6.1%, relative to the prior quarter and the year-ago period, respectively. Revenue growth relative to both prior periods reflected higher noninterest income partially offset by lower net interest income. Net interest income declined on a slowdown in loan growth, net interest margin contraction and seasonal considerations. Net interest income on a fully tax-equivalent basis, a non-GAAP financial measure, declined 3.1%, or $1.0 million, to $30.3 million relative to the prior quarter, reflecting net interest margin contraction, partially offset by an increase in total average earning asset balances. Net interest margin on a fully tax-equivalent basis, a non-GAAP financial measure, was 3.83%, down 23 basis points from the prior quarter, primarily reflecting higher interest rates on deposits and elevated deposit balances driven by seasonal considerations associated with a BaaS relationship, in addition to a decline in average loan balances due to market conditions. Total cost of funds was 2.52%, up eight basis points compared to the prior quarter, primarily reflecting an increase in balances due to seasonal tax deposits. Average earning asset balances increased 4.3% from the prior quarter, reflecting higher interest-bearing balances with banks and higher investment securities balances, partially offset by lower average loan balances. Average total loan balances declined 0.4% from the prior quarter, reflecting slower market demand and deliberate efforts to improve balance sheet liquidity. Measures of safety and soundness were generally stable. The Community Bank Leverage Ratio, Tier 1 Risk-Based Capital Ratio and MVB Bank’s Total Risk-Based Capital Ratio were 10.1%, 14.4%, and 15.2%, respectively, compared to 10.5%, 14.4%, and 15.1%, respectively, at the prior quarter end. Tangible book value per share, a non-U.S. GAAP measure discussed below, increased 0.2% to $22.48, relative to the prior quarter-end, and increased 6.2% from the year-ago period. Nonperforming loans declined $0.7 million, or 8.7%, to $7.5 million, or 0.3% of total loans, from $8.3 million, or 0.4% of total loans, at the prior quarter end. Criticized loans as a percentage of total loans were 5.8%, as compared to 5.3% at the prior quarter end. Net charge-offs were $1.3 million, or 0.2%, for the first quarter of 2024, compared to $0.5 million, or 0.1%, for the prior quarter. For the first quarter of 2024, net charge-offs included $0.6 million related to a SBA loan secured by business assets, $0.5 million related to the subprime consumer automotive segment and $0.4 million related to a commercial client in the energy industry. The provision for credit losses totaled $2.0 million, compared to a release of allowance of $2.1 million for the prior quarter. The allowance for credit losses was 1.01% of total loans, as compared to 0.95% at the prior quarter end. Expenses higher due to employee compensation and continued investment spend to enhance regulatory and compliance infrastructure. Noninterest expense increased 6.7% to $30.2 million relative to the prior quarter, primarily reflecting an increase in employee benefits and continued elevated professional fees and other operating costs to enhance risk management and compliance-related infrastructure in response to changing regulatory requirements following the industry events of March 2023. INCOME STATEMENT Net interest income on a tax-equivalent basis totaled $30.3 million for the first quarter of 2024, a decline of $1.0 million, or 3.1%, from the fourth quarter of 2023 and $2.7 million, or 8.1%, from the first quarter of 2023. The decline from both prior periods reflects a lower net interest margin, partially offset by higher average earning balances. Interest income increased $0.3 million, or 0.7%, from the fourth quarter of 2023 and increased $5.3 million, or 11.8%, from the first quarter of 2023. Relative to the prior quarter, the slight increase primarily reflects higher interest income from cash balances due to seasonal considerations and increased interest income from investment securities, mostly offset by a decline in interest income from loans, driven by lower loan balances and a lower tax-equivalent yield on loans. Relative to the prior year, higher interest income reflects the cumulative impact of earning assets booked at higher yields than the prevailing portfolio yield in the prior period and the repricing of variable rate loans in a higher interest rate environment. Interest expense increased $1.3 million, or 7.0%, from the fourth quarter of 2023 and $7.9 million, or 65.3%, from the first quarter of 2023. The cost of funds was 2.52% for the first quarter of 2024, up from 2.44% for the fourth quarter of 2023 and 1.59% for the first quarter of 2023. Relative to the prior quarter, higher interest expense primarily reflects higher interest rates on deposits and seasonal increases in deposits due to tax season driven by a BaaS relationship. Relative to the year-ago period, the increase reflects the impact of higher interest rates on our deposits. On a tax-equivalent basis, net interest margin for the first quarter of 2024 was 3.83%, a decline of 23 basis points versus the fourth quarter of 2023 and 57 basis points versus the first quarter of 2023. See the table below for a reconciliation between net interest margin and net interest margin on a fully tax-equivalent basis, a non-GAAP measure. Contraction in net interest margin from the prior quarter primarily reflects an unfavorable shift in the mix of average earning assets, including lower loan balances, higher cash and investment securities balances with lower yields and higher funding costs driven by the volume of deposits and higher interest rates on deposits associated with a BaaS relationship. Relative to the year-ago period, the contraction in net interest margin reflects higher funding costs, which have significantly outpaced the increase in average earning asset yields. Noninterest income totaled $7.8 million for the first quarter of 2024, an increase of $3.4 million from the fourth quarter of 2023 and $4.8 million from the first quarter of 2023. The increase compared to the prior quarter is primarily driven by a decline of $1.3 million in equity method investment losses from our mortgage segment, an increase of $1.0 million in payment card and service charge income and a $0.7 million in gain on sale of available-for-sale investment securities. Additionally, the fourth quarter of 2023 included a $0.7 million loss on derivatives without a comparable loss in the first quarter of 2024 and a $0.3 million gain on sale of loans without a comparable gain in the first quarter of 2024. The $4.8 million increase in noninterest income from the first quarter of 2023 was primarily driven by increases of $1.2 million in payment card and service charge income and $0.6 million in other operating income. There was a gain on sale of available-for-sale investment securities of $0.7 million during the first quarter of 2024, as compared to a loss of $1.5 million in the first quarter of 2023. Additionally, there was a decline in holding loss on equity securities of $0.3 million, and the first quarter of 2023 included a $0.4 million loss on sale of loans without a comparable loss in the first quarter of 2024. Noninterest expense totaled $30.2 million for the first quarter of 2024, an increase of $1.9 million, or 6.7%, from the fourth quarter of 2023 and $1.9 million, or 6.6%, from the first quarter of 2023. The increase from the fourth quarter of 2023 primarily reflects an increase in salaries and employee benefits of $1.6 million, or 10.9%. The increase from the first quarter of 2023 primarily reflects an increase of $2.8 million in professional fees, partially offset by decreases of $0.4 million in other operating expense, $0.4 million in travel, entertainment, dues and subscriptions and $0.3 million in salaries and employee benefit expense. BALANCE SHEET Loans totaled $2.27 billion at March 31, 2024, a decline of $50.3 million, or 2.2%, and $93.8 million, or 4.0%, as compared to December 31, 2023 and March 31, 2023, respectively. The decline in loan balances compared to the prior quarters primarily reflects lower market demand, the impact of loan amortization and payoffs and slower loan growth based on overall market conditions and portfolio management. Deposits totaled $3.15 billion as of March 31, 2024, an increase of $243.9 million, or 8.4%, from December 31, 2023, and a decline of $5.5 million, or 0.2%, from March 31, 2023. Relative to the prior quarter, deposit growth reflected strong growth in NIB deposits and seasonal considerations due to tax season driven by a BaaS relationship. Relative to the year-ago period, the decline reflects the increased utilization of off-balance sheet deposit networks to generate fee income, enhance capital efficiency and manage liquidity and concentration risk, partially offset by the increase in NIB deposits. NIB deposits totaled $1.39 billion as of March 31, 2024, an increase of $193.8 million, or 16.2%, from December 31, 2023 and an increase of $256.8 million, or 22.6%, from March 31, 2023. Relative to both prior periods, growth in NIB deposits reflected growth in customer business volume and, for the immediately preceding quarter, seasonal considerations. NIB deposits represented 44.2% of total deposits, compared to 41.3% of total deposits at the prior quarter-end, and 36.0% for the year-ago period. CAPITAL The Community Bank Leverage Ratio was 10.1% as of March 31, 2024, compared to 10.5% as of December 31, 2023 and 10.0% as of March 31, 2023. MVB’s Tier 1 Risk-Based Capital Ratio was 14.4% as of March 31, 2024, compared to 14.4% as of December 31, 2023 and 13.7% as of March 31, 2023. The Bank’s Total Risk-Based Capital Ratio was 16.04% as of March 31, 2024, compared to 15.1% as of December 31, 2023 and 14.9% as of March 31, 2023. The tangible common equity ratio, a non-GAAP financial measure, was 8.1% as of March 31, 2024, compared to 8.6% as of December 31, 2023 and 7.5% as of as of March 31, 2023. See the reconciliation of the tangible common equity ratio to its most directly comparable U.S. GAAP financial measure later in this release. The Company issued a quarterly cash dividend of $0.17 per share for the first quarter of 2024, consistent with the fourth quarter of 2023 and the first quarter of 2023. ASSET QUALITY Nonperforming loans totaled $7.5 million, or 0.3% of total loans, as of March 31, 2024, as compared to $8.3 million, or 0.4% of total loans, as of December 31, 2023, and $13.1 million, or 0.6% of total loans, as of March 31, 2023. Criticized loans as a percentage of total loans were 5.8%, compared to 5.3% as of December 31, 2023 and 3.6% as of March 31, 2023. Net charge-offs were $1.3 million, or 0.2% of total loans, for the first quarter of 2024, compared to $0.5 million, or 0.1% of total loans, for the fourth quarter of 2023 and $1.7 million, or 0.3% of total loans, for the first quarter of 2023. The provision for credit losses totaled $2.0 million compared to a $2.1 million release of allowance for the prior quarter ended December 31, 2023, and provision of $4.6 million for the quarter ended March 31, 2023. The allowance for credit losses was 1.01% of total loans at March 31, 2024, as compared to 0.95% at December 31, 2023 and 1.50% at March 31, 2023. About MVB Financial Corp. MVB Financial, the holding company of MVB Bank, is publicly traded on The Nasdaq Capital Market® (“Nasdaq”) under the ticker “MVBF.” MVB is a financial holding company headquartered in Fairmont, West Virginia. Through its subsidiary, MVB Bank, and MVB Bank’s subsidiaries, MVB Financial provides financial services to individuals and corporate clients in the Mid-Atlantic region and beyond. Nasdaq is a leading global provider of trading, clearing, exchange technology, listing, information and public company services. For more information about MVB, please visit ir.mvbbanking.com. Forward-looking Statements MVB Financial has made forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, in this press release that are intended to be covered by the protections provided under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations about the future and are subject to risks and uncertainties. Forward-looking statements include, without limitation, information concerning possible or assumed future results of operations of the Company and its subsidiaries. Forward-looking statements can be identified by the use of words such as “may,” “could,” “should,” “would,” “will,” “plans,” “believes,” “estimates,” “expects,” “anticipates,” “intends,” “continues” or the negative of those terms or similar expressions. Note that many factors could affect the future financial results of the Company and its subsidiaries, both individually and collectively, and could cause those results to differ materially from those expressed in forward-looking statements. Therefore, undue reliance should not be placed upon any forward-looking statements. Those factors include but are not limited to: market, economic, operational, liquidity and credit risk; changes in market interest rates; impacts related to or resulting from recent turmoil in the banking industry; inability to successfully execute business plans, including strategies related to investments in Fintech companies; competition; unforeseen events, such as pandemics or natural disasters, and any governmental or societal responses thereto; changes in economic, business and political conditions; changes in demand for loan products and deposit flow; operational risks and risk management failures; and government regulation and supervision. Additional factors that may cause actual results to differ materially from those described in the forward-looking statements can be found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as well as its other filings with the Securities and Exchange Commission (“SEC”), which are available on the SEC’s website at www.sec.gov. Except as required by law, the Company disclaims any obligation to update, revise or correct any forward-looking statements. Accounting standards require the consideration of subsequent events occurring after the balance sheet date for matters that require adjustment to, or disclosure in, the consolidated financial statements. The review period for subsequent events extends up to and including the filing date of a public company’s financial statements when filed with the SEC. Accordingly, the consolidated financial information in this announcement is subject to change. Non-U.S. GAAP Financial Measures This document contains supplemental financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Management uses these non-U.S. GAAP measures in its analysis of the Company’s performance. These measures should not be considered a substitute for U.S. GAAP basis measures nor should they be viewed as a substitute for operating results determined in accordance with U.S. GAAP. Management believes the presentation of non-U.S. GAAP financial measures that exclude the impact of specified items provide useful supplemental information that is essential to a proper understanding of the Company’s financial condition and results. Non-U.S. GAAP measures are not formally defined under U.S. GAAP, and other entities may use calculation methods that differ from those used by us. As a complement to U.S. GAAP financial measures, our management believes these non-U.S. GAAP financial measures assist investors in comparing the financial condition and results of operations of financial institutions due to the industry prevalence of such non-U.S. GAAP measures. See the tables below for a reconciliation of these non-U.S. GAAP measures to the most directly comparable U.S. GAAP financial measures. MVB Financial Corp. Financial Highlights Consolidated Statements of Income (Unaudited) (Dollars in thousands, except per share data) Quarterly 2024 2023 2023 First Quarter Fourth Quarter First Quarter Interest income $ 50,030 $ 49,699 $ 44,763 Interest expense 19,891 18,592 12,034 Net interest income 30,139 31,107 32,729 Provision (release of allowance) for credit losses 1,997 (2,103 ) 4,576 Net interest income after provision (release of allowance) for credit losses 28,142 33,210 28,153 Total noninterest income 7,834 4,438 3,067 Noninterest expense: Salaries and employee benefits 16,489 14,863 16,746 Other expense 13,702 13,438 11,571 Total noninterest expenses 30,191 28,301 28,317 Income before income taxes 5,785 9,347 2,903 Income taxes 1,283 1,431 465 Net income from continuing operations, before noncontrolling interest 4,502 7,916 2,438 Income from discontinued operations, before income taxes — — 11,831 Income taxes - discontinued operations — — 3,049 Net income from discontinued operations — — 8,782 Net Income, before noncontrolling interest 4,502 7,916 11,220 Net (income) loss attributable to noncontrolling interest (20 ) (5 ) 122 Net income available to common shareholders $ 4,482 $ 7,911 $ 11,342 Earnings per share from continuing operations - basic $ 0.35 $ 0.62 $ 0.20 Earnings per share from discontinued operations - basic $ — $ — $ 0.70 Earnings per share - basic $ 0.35 $ 0.62 $ 0.90 Earnings per share from continuing operations - diluted $ 0.34 $ 0.61 $ 0.20 Earnings per share from discontinued operations - diluted $ — $ — $ 0.67 Earnings per share - diluted $ 0.34 $ 0.61 $ 0.87 Noninterest Income (Unaudited) (Dollars in thousands) Quarterly 2024 2023 2023 First Quarter Fourth Quarter First Quarter Card acquiring income $ 251 $ 1,348 $ 622 Service charges on deposits 1,523 174 1,126 Interchange income 3,039 2,289 1,862 Total payment card and service charge income 4,813 3,811 3,610 Equity method investments loss (1,128 ) (2,429 ) (1,193 ) Compliance and consulting income 1,000 986 1,016 Gain (loss) on sale of loans — 271 (356 ) Investment portfolio gains (losses) 609 75 (1,844 ) Other noninterest income 2,540 1,724 1,834 Total noninterest income $ 7,834 $ 4,438 $ 3,067 Condensed Consolidated Balance Sheets (Unaudited) (Dollars in thousands) March 31, 2024 December 31, 2023 March 31, 2023 Cash and cash equivalents $ 640,426 $ 398,229 $ 575,265 Securities available-for-sale, at fair value 349,678 345,275 339,578 Equity securities 41,037 41,086 38,576 Loans held-for-sale — 629 19,893 Loans receivable 2,267,310 2,317,594 2,361,153 Less: Allowance for credit losses (22,804 ) (22,124 ) (35,513 ) Loans receivable, net 2,244,506 2,295,470 2,325,640 Premises and equipment, net 19,968 20,928 22,869 Goodwill — — — Other assets 251,775 212,265 230,055 Total assets $ 3,547,390 $ 3,313,882 $ 3,551,876 Noninterest-bearing deposits $ 1,391,070 $ 1,197,272 $ 1,134,257 Interest-bearing deposits 1,754,259 1,704,204 2,016,558 Senior term loan 6,549 6,786 9,647 Subordinated debt 73,602 73,540 73,350 Other liabilities 30,082 42,738 46,748 Stockholders' equity 291,828 289,342 271,316 Total liabilities and stockholders' equity $ 3,547,390 $ 3,313,882 $ 3,551,876 Reportable Segments (Unaudited) Three Months Ended March 31, 2024 CoRe Banking Mortgage Banking Financial Holding Company Other Intercompany Eliminations Consolidated (Dollars in thousands) Interest income $ 49,942 $ 103 $ 2 $ — $ (17 ) $ 50,030 Interest expense 18,927 — 959 22 (17 ) 19,891 Net interest income (expense) 31,015 103 (957 ) (22 ) — 30,139 Provision for credit losses 1,997 — — — — 1,997 Net interest income (expense) after provision for credit losses 29,018 103 (957 ) (22 ) — 28,142 Noninterest income 7,521 (1,129 ) 2,265 3,264 (4,087 ) 7,834 Noninterest Expenses: Salaries and employee benefits 9,823 — 4,678 1,988 — 16,489 Other expenses 13,821 — 1,841 2,127 (4,087 ) 13,702 Total noninterest expenses 23,644 — 6,519 4,115 (4,087 ) 30,191 Income (loss), before income taxes 12,895 (1,026 ) (5,211 ) (873 ) — 5,785 Income taxes 2,878 (229 ) (1,157 ) (209 ) — 1,283 Net income (loss), before noncontrolling interest 10,017 (797 ) (4,054 ) (664 ) — 4,502 Net income attributable to noncontrolling interest — — — (20 ) — (20 ) Net income (loss) available to common shareholders $ 10,017 $ (797 ) $ (4,054 ) $ (684 ) $ — $ 4,482 Three Months Ended December 31, 2023 CoRe Banking Mortgage Banking Financial Holding Company Other Intercompany Eliminations Consolidated (Dollars in thousands) Interest income $ 49,639 $ 103 $ 3 $ — $ (46 ) $ 49,699 Interest expense 17,573 — 993 72 (46 ) 18,592 Net interest income (expense) 32,066 103 (990 ) (72 ) — 31,107 Provision for credit losses (2,103 ) — — — — (2,103 ) Net interest income (expense) after provision for credit losses 34,169 103 (990 ) (72 ) — 33,210 Noninterest income 5,175 (2,430 ) 2,351 3,204 (3,862 ) 4,438 Noninterest Expenses: Salaries and employee benefits 9,374 — 3,339 2,150 — 14,863 Other expenses 13,318 — 2,161 1,821 (3,862 ) 13,438 Total noninterest expenses 22,692 — 5,500 3,971 (3,862 ) 28,301 Income (loss) before income taxes 16,652 (2,327 ) (4,139 ) (839 ) — 9,347 Income taxes 3,962 (543 ) (1,796 ) (192 ) — 1,431 Net income (loss), before noncontrolling interest 12,690 (1,784 ) (2,343 ) (647 ) — 7,916 Net income attributable to noncontrolling interest — — — (5 ) — (5 ) Net income (loss) available to common shareholders $ 12,690 $ (1,784 ) $ (2,343 ) $ (652 ) $ — $ 7,911 Three Months Ended March 31, 2023 CoRe Banking Mortgage Banking Financial Holding Company Other Intercompany Eliminations Consolidated (Dollars in thousands) Interest income $ 44,662 $ 105 $ 33 $ (6 ) $ (31 ) $ 44,763 Interest expense 11,041 — 993 31 (31 ) 12,034 Net interest income (expense) 33,621 105 (960 ) (37 ) — 32,729 Provision for credit losses 4,576 — — — — 4,576 Net interest income (expense) after provision for credit losses 29,045 105 (960 ) (37 ) — 28,153 Noninterest income 3,018 (1,186 ) 2,410 1,784 (2,959 ) 3,067 Noninterest Expenses: Salaries and employee benefits 9,051 — 4,950 2,745 — 16,746 Other expenses 11,054 34 1,917 1,525 (2,959 ) 11,571 Total noninterest expenses 20,105 34 6,867 4,270 (2,959 ) 28,317 Income (loss), before income taxes 11,958 (1,115 ) (5,417 ) (2,523 ) — 2,903 Income taxes 2,515 (504 ) (942 ) (604 ) — 465 Net income (loss) from continuing operations 9,443 (611 ) (4,475 ) (1,919 ) — 2,438 Income from discontinued operations, before income taxes — — — 11,831 — 11,831 Income tax expense - discontinued operations — — — 3,049 — 3,049 Net income from discontinued operations — — — 8,782 — 8,782 Net income (loss), before noncontrolling interest 9,443 (611 ) (4,475 ) 6,863 — 11,220 Net loss attributable to noncontrolling interest — — — 122 — 122 Net income (loss) available to common shareholders $ 9,443 $ (611 ) $ (4,475 ) $ 6,985 $ — $ 11,342 Average Balances and Interest Rates (Unaudited) (Dollars in thousands) Three Months Ended Three Months Ended Three Months Ended March 31, 2024 December 31, 2023 March 31, 2023 Average Balance Interest Income/ Expense Yield/ Cost Average Balance Interest Income/ Expense Yield/ Cost Average Balance Interest Income/ Expense Yield/ Cost Assets Interest-bearing balances with banks $ 549,894 $ 7,341 5.37 % $ 442,521 $ 5,944 5.33 % $ 285,102 $ 3153 4.49 % Investment securities: Taxable 246,091 1,743 2.85 222,303 1,444 2.58 236,574 1,848 3.17 Tax-exempt 1 106,309 887 3.36 98,464 876 3.53 137,799 1,308 3.85 Loans and loans held-for-sale: 2 Commercial 1,626,286 32,152 7.95 1,635,510 33,665 8.17 1,620,509 28,538 7.14 Tax-exempt 1 3,373 37 4.41 3,492 38 4.32 3,944 43 4.42 Real estate 576,148 6,612 4.62 576,580 6,421 4.42 621,388 6,295 4.11 Consumer 77,300 1,452 7.55 76,088 1,503 7.84 137,547 3,862 11.39 Total loans 2,283,107 40,253 7.09 2,291,670 41,627 7.21 2,383,388 38,738 6.59 Total earning assets 3,185,401 50,224 6.34 3,054,958 49,891 6.48 3,042,863 45,047 6.00 Less: Allowance for credit losses (22,258 ) (24,079 ) (30,135 ) Cash and due from banks 5,405 5,771 243 Other assets 335,029 292,574 339,676 Total assets $ 3,503,577 $ 3,329,224 $ 3,352,647 Liabilities Deposits: NOW $ 555,530 $ 4,929 3.57 % $ 637,144 $ 5,386 3.35 % $ 796,901 $ 4,661 2.37 % Money market checking 408,764 3,759 3.70 650,925 3,691 2.25 209,227 928 1.80 Savings 163,611 1,640 4.03 70,146 442 2.50 93,297 641 2.79 IRAs 7,762 74 3.83 7,296 66 3.59 6,151 27 1.78 CDs 674,611 8,529 5.08 590,517 8,014 5.38 386,144 3,896 4.09 Repurchase agreements and federal funds sold 2,951 — — 4,736 — — 7,612 1 0.05 FHLB and other borrowings 44 1 9.14 11 — — 71,166 888 5.06 Senior term loan 6,736 150 8.96 8,183 183 8.87 9,765 194 8.06 Subordinated debt 73,571 809 4.42 73,510 810 4.37 73,318 798 4.41 Total interest-bearing liabilities 1,893,580 19,891 4.22 2,042,468 18,592 3.61 1,653,581 12,034 2.95 Noninterest-bearing demand deposits 1,279,194 975,122 1,380,516 Other liabilities 42,017 39,410 37,087 Total liabilities 3,214,791 3,057,000 3,071,184 Stockholders’ equity Common stock 13,659 13,588 13,471 Paid-in capital 161,532 160,106 153,389 Treasury stock (16,741 ) (16,741 ) (16,741 ) Retained earnings 160,933 156,004 166,426 Accumulated other comprehensive loss (30,559 ) (40,688 ) (35,345 ) Total stockholders’ equity attributable to parent 288,824 272,269 281,200 Noncontrolling interest (38 ) (45 ) 263 Total stockholders’ equity 288,786 272,224 281,463 Total liabilities and stockholders’ equity $ 3,503,577 $ 3,329,224 $ 3,352,647 Net interest spread (tax-equivalent) 2.12 % 2.87 % 3.05 % Net interest income and margin (tax-equivalent)1 $ 30,333 3.83 % $ 31,299 4.06 % $ 33,013 4.40 % Less: Tax-equivalent adjustments $ (194 ) $ (193 ) $ (284 ) Net interest spread 2.10 % 2.84 % 3.02 % Net interest income and margin $ 30,139 3.81 % $ 31,107 4.04 % $ 32,729 4.36 % 1In order to make pre-tax income and resultant yields on tax-exempt loans and investment securities comparable to those on taxable loans and investment securities, a tax-equivalent adjustment has been computed using a Federal tax rate of 21% for the periods presented, which is a non-GAAP financial measure. See the reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure included in the tables on page 17. 2 Non-accrual loans are included in total loan balances, lowering the effective yield for the portfolio in the aggregate. Selected Financial Data (Unaudited) (Dollars in thousands, except per share data) Quarterly 2024 2023 2023 First Quarter Fourth Quarter First Quarter Earnings and Per Share Data: Net income $ 4,482 $ 7,911 $ 11,342 Earnings per share from continuing operations - basic $ 0.35 $ 0.62 $ 0.20 Earnings per share from discontinued operations - basic $ — $ — $ 0.70 Earnings per share - basic $ 0.35 $ 0.62 $ 0.90 Earnings per share from continuing operations - diluted $ 0.34 $ 0.61 $ 0.20 Earnings per share from discontinued operations - diluted $ — $ — $ 0.67 Earnings per share - diluted $ 0.34 $ 0.61 $ 0.87 Cash dividends paid per common share $ 0.17 $ 0.17 $ 0.17 Book value per common share $ 22.73 $ 22.68 $ 21.43 Tangible book value per common share 1 $ 22.48 $ 22.43 $ 21.17 Weighted-average shares outstanding - basic 12,810,956 12,740,193 12,623,361 Weighted-average shares outstanding - diluted 13,119,292 13,024,562 13,016,082 Performance Ratios: Return on average assets 2 0.5 % 1.0 % 1.4 % Return on average equity 2 6.2 % 11.6 % 16.1 % Net interest margin 3 4 3.83 % 4.06 % 4.40 % Efficiency ratio 5 79.5 % 79.6 % 61.4 % Overhead ratio 2 6 3.4 % 3.4 % 3.4 % Equity to assets 8.2 % 8.7 % 7.6 % Asset Quality Data and Ratios: Charge-offs $ 2,150 $ 1,868 $ 4,847 Recoveries $ 835 $ 1,343 $ 3,169 Net loan charge-offs to total loans 2 7 0.2 % 0.1 % 0.3 % Allowance for credit losses $ 22,804 $ 22,124 $ 35,513 Allowance for credit losses to total loans 8 1.01 % 0.95 % 1.50 % Nonperforming loans $ 7,546 $ 8,267 $ 13,085 Nonperforming loans to total loans 0.3 % 0.4 % 0.6 % Mortgage Company Equity Method Investees Production Data9: Mortgage pipeline $ 790,771 $ 706,873 $ 714,258 Loans originated $ 1,050,089 $ 1,020,128 $ 232,660 Loans closed $ 653,306 $ 724,453 $ 385,011 Loans sold $ 916,115 $ 639,788 $ 302,782 1 Common equity less total goodwill and intangibles per common share, a non-U.S. GAAP measure. See the reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure included in the tables on page 17. 2 Annualized for the quarterly periods presented. 3 Net interest income as a percentage of average interest-earning assets. 4 Presented on a fully tax-equivalent basis, a non-GAAP financial measure. 5 Noninterest expense as a percentage of net interest income and noninterest income, a non-U.S. GAAP measure. 6 Noninterest expense as a percentage of average assets, a non-U.S. GAAP measure. 7 Charge-offs, less recoveries. 8 Excludes loans held-for-sale. 9 Information is related to Intercoastal Mortgage Company, LLC and Warp Speed Holdings LLC, entities in which MVB has an ownership interest that are accounted for as equity method investments. Non-GAAP Reconciliation: Net Interest Margin on a Full Tax-Equivalent Basis The following table reconciles, for the periods shown below, net interest margin on a fully tax-equivalent basis: Three Months Ended (Dollars in thousands) March 31, 2024 December 31, 2023 March 31, 2023 Net interest margin - U.S. GAAP basis Net interest income $ 30,139 $ 31,107 $ 32,729 Average interest-earning assets $ 3,185,401 $ 3,054,958 $ 3,042,863 Net interest margin 3.81 % 4.04 % 4.36 % Net interest margin - non-U.S. GAAP basis Net interest income $ 30,139 $ 31,107 $ 32,729 Impact of fully tax-equivalent adjustment 194 193 284 Net interest income on a fully tax-equivalent basis $ 30,333 $ 31,299 $ 33,013 Average interest-earning assets $ 3,185,401 $ 3,054,958 $ 3,042,863 Net interest margin on a fully tax-equivalent basis 3.83 % 4.06 % 4.40 % Non-U.S. GAAP Reconciliation: Tangible Book Value per Common Share and Tangible Common Equity Ratio (Unaudited) (Dollars in thousands, except per share data) March 31, 2024 December 31, 2023 March 31, 2023 Tangible Book Value per Common Share Goodwill $ 2,838 $ 2,838 $ 2,838 Intangibles 330 352 420 Total intangibles $ 3,168 3,190 3,258 Total equity attributable to parent $ 291,850 289,384 271,131 Less: Total intangibles (3,168 ) (3,190 ) (3,258 ) Tangible common equity $ 288,682 $ 286,194 $ 267,873 Tangible common equity $ 288,682 $ 286,194 $ 267,873 Common shares outstanding (000s) 12,841 12,758 12,653 Tangible book value per common share $ 22.48 $ 22.43 $ 21.17 Tangible Common Equity Ratio Total assets $ 3,547,390 $ 3,313,882 $ 3,551,876 Less: Total intangibles (3,168 ) (3,190 ) (3,258 ) Tangible assets $ 3,544,222 $ 3,310,692 $ 3,548,618 Tangible assets $ 3,544,222 $ 3,310,692 $ 3,548,618 Tangible common equity $ 288,682 $ 286,194 $ 267,873 Tangible common equity ratio 8.1 % 8.6 % 7.5 % View source version on businesswire.com: https://www.businesswire.com/news/home/20240429858018/en/Contacts Questions or comments concerning this earnings release should be directed to: MVB Financial Corp. Donald T. Robinson, President and Chief Financial Officer (304) 598-3500 drobinson@mvbbanking.com Amy Baker, VP, Corporate Communications and Marketing (844) 682-2265 abaker@mvbbanking.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
MVB Financial Corp. Announces First Quarter 2024 Results By: MVB Financial Corp. via Business Wire April 29, 2024 at 16:30 PM EDT MVB Financial Corp. (NASDAQ: MVBF) (“MVB Financial,” “MVB” or the “Company”), the holding company for MVB Bank, Inc. ("MVB Bank"), today announced financial results for the first quarter of 2024, with reported net income of $4.5 million, or $0.35 basic and $0.34 diluted earnings per share. First Quarter 2024 Highlights As Compared to Fourth Quarter 2023 Total revenue increased 6.8%, or $2.4 million. Fintech fee income grew 26.3%, or $1.0 million. Noninterest bearing deposits increased 16.2%, or $193.8 million, and represent 44% of total deposits. Nonperforming loans declined 8.7%; Measures of asset quality and capital strength were stable. Book value per share and tangible book value per share, a non-GAAP financial measure, each increased by 0.2% to $22.73 and $22.48, respectively. From Larry F. Mazza, Chief Executive Officer, MVB Financial: “Turbulence in financial markets and the banking sector persisted during the first quarter of 2024. Amidst these volatile market conditions, MVB made progress on several key initiatives. Most notably, we further solidified foundational measures of safety and soundness. Our balance sheet liquidity position and the quality of our funding mix improved, asset quality indicators were stable, commercial real estate concentrations remained well within regulatory guidelines and measures of capital strength were maintained. We also remained proactive in investing at a higher-than-normal pace to contend with changing regulatory requirements following the industry events of early 2023. These higher costs, alongside other cyclical and seasonal challenges, weighed on our earnings for the first quarter. “At the same time, initiatives to drive revenue growth are bearing fruit. Banking-as-a-service fee income increased from the prior quarter and the year-ago period, benefiting from seasonal considerations, notably the influence of tax season, and growth in the underlying business. Through these challenging times for the banking sector, I’m pleased and encouraged by the adaptability of the MVB Team and the resilience of our business model.” FIRST QUARTER 2024 HIGHLIGHTS Strong core deposit growth. Total deposits increased 8.4%, or $243.9 million, to $3.15 billion, compared to the prior quarter-end, primarily reflecting strong growth in noninterest bearing (“NIB”) deposits. Growth also reflected strength in Banking-as-a-Service (“BaaS”) deposits and increased balances due to seasonal tax volume and deposits tied to payment relationships. Total off-balance sheet deposits increased to $1.53 billion as compared to $1.09 billion at the prior quarter-end. Off-balance sheet deposit networks are utilized to generate fee income, enhance capital efficiency and manage liquidity and concentration risk. NIB deposits increased 16.2%, or $193.8 million, and 22.6%, or $256.8 million, to $1.39 billion, as compared to the prior quarter-end and the year-ago period, respectively. NIB deposit growth relative to the prior quarter primarily reflected seasonal tax deposits and growth in customer business volume. NIB deposits represented 44.2% of total deposits, as compared to 41.3% of total deposits at the prior quarter-end, and 36.0% for the year-ago period. Certificate of deposit (“CD”) balances, which include brokered deposits, increased 18.7%, or $109.5 million, to $696.3 million, from the prior quarter-end. The loan-to-deposit ratio was 72.1% as of March 31, 2024, compared to 79.9% as of December 31, 2023 and 74.9% as of March 31, 2023. The decline in the loan-to-deposit ratio reflects the increase in deposits, primarily due to our BaaS business, combined with a decline in loan balances driven by market conditions. Fintech fee income growth drove quarter and year-over-year growth in noninterest income and total revenues. Payment card and service charge income, which includes BaaS fee income, increased by 26.3% and 33.3% as compared to the prior quarter and the year-ago period, respectively. Growth relative to the prior quarter primarily related to increased transactional volume due to seasonal tax deposits and expanded relationships with our Fintech partners. Growth relative to the prior year is primarily related to the increased transactional volume from seasonal tax deposits year over year. Total noninterest income grew 76.5%, or $3.4 million, relative to the prior quarter, to $7.8 million, primarily reflecting higher payment card and service charge income and a decline in the loss on equity method investments (mortgage banking). Relative to the prior year, total noninterest income grew 155.4%, or $4.8 million, reflecting higher payment card and service charge income and higher other operating income. Total revenues increased $2.4 million, or 6.8%, and $2.2 million, or 6.1%, relative to the prior quarter and the year-ago period, respectively. Revenue growth relative to both prior periods reflected higher noninterest income partially offset by lower net interest income. Net interest income declined on a slowdown in loan growth, net interest margin contraction and seasonal considerations. Net interest income on a fully tax-equivalent basis, a non-GAAP financial measure, declined 3.1%, or $1.0 million, to $30.3 million relative to the prior quarter, reflecting net interest margin contraction, partially offset by an increase in total average earning asset balances. Net interest margin on a fully tax-equivalent basis, a non-GAAP financial measure, was 3.83%, down 23 basis points from the prior quarter, primarily reflecting higher interest rates on deposits and elevated deposit balances driven by seasonal considerations associated with a BaaS relationship, in addition to a decline in average loan balances due to market conditions. Total cost of funds was 2.52%, up eight basis points compared to the prior quarter, primarily reflecting an increase in balances due to seasonal tax deposits. Average earning asset balances increased 4.3% from the prior quarter, reflecting higher interest-bearing balances with banks and higher investment securities balances, partially offset by lower average loan balances. Average total loan balances declined 0.4% from the prior quarter, reflecting slower market demand and deliberate efforts to improve balance sheet liquidity. Measures of safety and soundness were generally stable. The Community Bank Leverage Ratio, Tier 1 Risk-Based Capital Ratio and MVB Bank’s Total Risk-Based Capital Ratio were 10.1%, 14.4%, and 15.2%, respectively, compared to 10.5%, 14.4%, and 15.1%, respectively, at the prior quarter end. Tangible book value per share, a non-U.S. GAAP measure discussed below, increased 0.2% to $22.48, relative to the prior quarter-end, and increased 6.2% from the year-ago period. Nonperforming loans declined $0.7 million, or 8.7%, to $7.5 million, or 0.3% of total loans, from $8.3 million, or 0.4% of total loans, at the prior quarter end. Criticized loans as a percentage of total loans were 5.8%, as compared to 5.3% at the prior quarter end. Net charge-offs were $1.3 million, or 0.2%, for the first quarter of 2024, compared to $0.5 million, or 0.1%, for the prior quarter. For the first quarter of 2024, net charge-offs included $0.6 million related to a SBA loan secured by business assets, $0.5 million related to the subprime consumer automotive segment and $0.4 million related to a commercial client in the energy industry. The provision for credit losses totaled $2.0 million, compared to a release of allowance of $2.1 million for the prior quarter. The allowance for credit losses was 1.01% of total loans, as compared to 0.95% at the prior quarter end. Expenses higher due to employee compensation and continued investment spend to enhance regulatory and compliance infrastructure. Noninterest expense increased 6.7% to $30.2 million relative to the prior quarter, primarily reflecting an increase in employee benefits and continued elevated professional fees and other operating costs to enhance risk management and compliance-related infrastructure in response to changing regulatory requirements following the industry events of March 2023. INCOME STATEMENT Net interest income on a tax-equivalent basis totaled $30.3 million for the first quarter of 2024, a decline of $1.0 million, or 3.1%, from the fourth quarter of 2023 and $2.7 million, or 8.1%, from the first quarter of 2023. The decline from both prior periods reflects a lower net interest margin, partially offset by higher average earning balances. Interest income increased $0.3 million, or 0.7%, from the fourth quarter of 2023 and increased $5.3 million, or 11.8%, from the first quarter of 2023. Relative to the prior quarter, the slight increase primarily reflects higher interest income from cash balances due to seasonal considerations and increased interest income from investment securities, mostly offset by a decline in interest income from loans, driven by lower loan balances and a lower tax-equivalent yield on loans. Relative to the prior year, higher interest income reflects the cumulative impact of earning assets booked at higher yields than the prevailing portfolio yield in the prior period and the repricing of variable rate loans in a higher interest rate environment. Interest expense increased $1.3 million, or 7.0%, from the fourth quarter of 2023 and $7.9 million, or 65.3%, from the first quarter of 2023. The cost of funds was 2.52% for the first quarter of 2024, up from 2.44% for the fourth quarter of 2023 and 1.59% for the first quarter of 2023. Relative to the prior quarter, higher interest expense primarily reflects higher interest rates on deposits and seasonal increases in deposits due to tax season driven by a BaaS relationship. Relative to the year-ago period, the increase reflects the impact of higher interest rates on our deposits. On a tax-equivalent basis, net interest margin for the first quarter of 2024 was 3.83%, a decline of 23 basis points versus the fourth quarter of 2023 and 57 basis points versus the first quarter of 2023. See the table below for a reconciliation between net interest margin and net interest margin on a fully tax-equivalent basis, a non-GAAP measure. Contraction in net interest margin from the prior quarter primarily reflects an unfavorable shift in the mix of average earning assets, including lower loan balances, higher cash and investment securities balances with lower yields and higher funding costs driven by the volume of deposits and higher interest rates on deposits associated with a BaaS relationship. Relative to the year-ago period, the contraction in net interest margin reflects higher funding costs, which have significantly outpaced the increase in average earning asset yields. Noninterest income totaled $7.8 million for the first quarter of 2024, an increase of $3.4 million from the fourth quarter of 2023 and $4.8 million from the first quarter of 2023. The increase compared to the prior quarter is primarily driven by a decline of $1.3 million in equity method investment losses from our mortgage segment, an increase of $1.0 million in payment card and service charge income and a $0.7 million in gain on sale of available-for-sale investment securities. Additionally, the fourth quarter of 2023 included a $0.7 million loss on derivatives without a comparable loss in the first quarter of 2024 and a $0.3 million gain on sale of loans without a comparable gain in the first quarter of 2024. The $4.8 million increase in noninterest income from the first quarter of 2023 was primarily driven by increases of $1.2 million in payment card and service charge income and $0.6 million in other operating income. There was a gain on sale of available-for-sale investment securities of $0.7 million during the first quarter of 2024, as compared to a loss of $1.5 million in the first quarter of 2023. Additionally, there was a decline in holding loss on equity securities of $0.3 million, and the first quarter of 2023 included a $0.4 million loss on sale of loans without a comparable loss in the first quarter of 2024. Noninterest expense totaled $30.2 million for the first quarter of 2024, an increase of $1.9 million, or 6.7%, from the fourth quarter of 2023 and $1.9 million, or 6.6%, from the first quarter of 2023. The increase from the fourth quarter of 2023 primarily reflects an increase in salaries and employee benefits of $1.6 million, or 10.9%. The increase from the first quarter of 2023 primarily reflects an increase of $2.8 million in professional fees, partially offset by decreases of $0.4 million in other operating expense, $0.4 million in travel, entertainment, dues and subscriptions and $0.3 million in salaries and employee benefit expense. BALANCE SHEET Loans totaled $2.27 billion at March 31, 2024, a decline of $50.3 million, or 2.2%, and $93.8 million, or 4.0%, as compared to December 31, 2023 and March 31, 2023, respectively. The decline in loan balances compared to the prior quarters primarily reflects lower market demand, the impact of loan amortization and payoffs and slower loan growth based on overall market conditions and portfolio management. Deposits totaled $3.15 billion as of March 31, 2024, an increase of $243.9 million, or 8.4%, from December 31, 2023, and a decline of $5.5 million, or 0.2%, from March 31, 2023. Relative to the prior quarter, deposit growth reflected strong growth in NIB deposits and seasonal considerations due to tax season driven by a BaaS relationship. Relative to the year-ago period, the decline reflects the increased utilization of off-balance sheet deposit networks to generate fee income, enhance capital efficiency and manage liquidity and concentration risk, partially offset by the increase in NIB deposits. NIB deposits totaled $1.39 billion as of March 31, 2024, an increase of $193.8 million, or 16.2%, from December 31, 2023 and an increase of $256.8 million, or 22.6%, from March 31, 2023. Relative to both prior periods, growth in NIB deposits reflected growth in customer business volume and, for the immediately preceding quarter, seasonal considerations. NIB deposits represented 44.2% of total deposits, compared to 41.3% of total deposits at the prior quarter-end, and 36.0% for the year-ago period. CAPITAL The Community Bank Leverage Ratio was 10.1% as of March 31, 2024, compared to 10.5% as of December 31, 2023 and 10.0% as of March 31, 2023. MVB’s Tier 1 Risk-Based Capital Ratio was 14.4% as of March 31, 2024, compared to 14.4% as of December 31, 2023 and 13.7% as of March 31, 2023. The Bank’s Total Risk-Based Capital Ratio was 16.04% as of March 31, 2024, compared to 15.1% as of December 31, 2023 and 14.9% as of March 31, 2023. The tangible common equity ratio, a non-GAAP financial measure, was 8.1% as of March 31, 2024, compared to 8.6% as of December 31, 2023 and 7.5% as of as of March 31, 2023. See the reconciliation of the tangible common equity ratio to its most directly comparable U.S. GAAP financial measure later in this release. The Company issued a quarterly cash dividend of $0.17 per share for the first quarter of 2024, consistent with the fourth quarter of 2023 and the first quarter of 2023. ASSET QUALITY Nonperforming loans totaled $7.5 million, or 0.3% of total loans, as of March 31, 2024, as compared to $8.3 million, or 0.4% of total loans, as of December 31, 2023, and $13.1 million, or 0.6% of total loans, as of March 31, 2023. Criticized loans as a percentage of total loans were 5.8%, compared to 5.3% as of December 31, 2023 and 3.6% as of March 31, 2023. Net charge-offs were $1.3 million, or 0.2% of total loans, for the first quarter of 2024, compared to $0.5 million, or 0.1% of total loans, for the fourth quarter of 2023 and $1.7 million, or 0.3% of total loans, for the first quarter of 2023. The provision for credit losses totaled $2.0 million compared to a $2.1 million release of allowance for the prior quarter ended December 31, 2023, and provision of $4.6 million for the quarter ended March 31, 2023. The allowance for credit losses was 1.01% of total loans at March 31, 2024, as compared to 0.95% at December 31, 2023 and 1.50% at March 31, 2023. About MVB Financial Corp. MVB Financial, the holding company of MVB Bank, is publicly traded on The Nasdaq Capital Market® (“Nasdaq”) under the ticker “MVBF.” MVB is a financial holding company headquartered in Fairmont, West Virginia. Through its subsidiary, MVB Bank, and MVB Bank’s subsidiaries, MVB Financial provides financial services to individuals and corporate clients in the Mid-Atlantic region and beyond. Nasdaq is a leading global provider of trading, clearing, exchange technology, listing, information and public company services. For more information about MVB, please visit ir.mvbbanking.com. Forward-looking Statements MVB Financial has made forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, in this press release that are intended to be covered by the protections provided under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations about the future and are subject to risks and uncertainties. Forward-looking statements include, without limitation, information concerning possible or assumed future results of operations of the Company and its subsidiaries. Forward-looking statements can be identified by the use of words such as “may,” “could,” “should,” “would,” “will,” “plans,” “believes,” “estimates,” “expects,” “anticipates,” “intends,” “continues” or the negative of those terms or similar expressions. Note that many factors could affect the future financial results of the Company and its subsidiaries, both individually and collectively, and could cause those results to differ materially from those expressed in forward-looking statements. Therefore, undue reliance should not be placed upon any forward-looking statements. Those factors include but are not limited to: market, economic, operational, liquidity and credit risk; changes in market interest rates; impacts related to or resulting from recent turmoil in the banking industry; inability to successfully execute business plans, including strategies related to investments in Fintech companies; competition; unforeseen events, such as pandemics or natural disasters, and any governmental or societal responses thereto; changes in economic, business and political conditions; changes in demand for loan products and deposit flow; operational risks and risk management failures; and government regulation and supervision. Additional factors that may cause actual results to differ materially from those described in the forward-looking statements can be found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as well as its other filings with the Securities and Exchange Commission (“SEC”), which are available on the SEC’s website at www.sec.gov. Except as required by law, the Company disclaims any obligation to update, revise or correct any forward-looking statements. Accounting standards require the consideration of subsequent events occurring after the balance sheet date for matters that require adjustment to, or disclosure in, the consolidated financial statements. The review period for subsequent events extends up to and including the filing date of a public company’s financial statements when filed with the SEC. Accordingly, the consolidated financial information in this announcement is subject to change. Non-U.S. GAAP Financial Measures This document contains supplemental financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Management uses these non-U.S. GAAP measures in its analysis of the Company’s performance. These measures should not be considered a substitute for U.S. GAAP basis measures nor should they be viewed as a substitute for operating results determined in accordance with U.S. GAAP. Management believes the presentation of non-U.S. GAAP financial measures that exclude the impact of specified items provide useful supplemental information that is essential to a proper understanding of the Company’s financial condition and results. Non-U.S. GAAP measures are not formally defined under U.S. GAAP, and other entities may use calculation methods that differ from those used by us. As a complement to U.S. GAAP financial measures, our management believes these non-U.S. GAAP financial measures assist investors in comparing the financial condition and results of operations of financial institutions due to the industry prevalence of such non-U.S. GAAP measures. See the tables below for a reconciliation of these non-U.S. GAAP measures to the most directly comparable U.S. GAAP financial measures. MVB Financial Corp. Financial Highlights Consolidated Statements of Income (Unaudited) (Dollars in thousands, except per share data) Quarterly 2024 2023 2023 First Quarter Fourth Quarter First Quarter Interest income $ 50,030 $ 49,699 $ 44,763 Interest expense 19,891 18,592 12,034 Net interest income 30,139 31,107 32,729 Provision (release of allowance) for credit losses 1,997 (2,103 ) 4,576 Net interest income after provision (release of allowance) for credit losses 28,142 33,210 28,153 Total noninterest income 7,834 4,438 3,067 Noninterest expense: Salaries and employee benefits 16,489 14,863 16,746 Other expense 13,702 13,438 11,571 Total noninterest expenses 30,191 28,301 28,317 Income before income taxes 5,785 9,347 2,903 Income taxes 1,283 1,431 465 Net income from continuing operations, before noncontrolling interest 4,502 7,916 2,438 Income from discontinued operations, before income taxes — — 11,831 Income taxes - discontinued operations — — 3,049 Net income from discontinued operations — — 8,782 Net Income, before noncontrolling interest 4,502 7,916 11,220 Net (income) loss attributable to noncontrolling interest (20 ) (5 ) 122 Net income available to common shareholders $ 4,482 $ 7,911 $ 11,342 Earnings per share from continuing operations - basic $ 0.35 $ 0.62 $ 0.20 Earnings per share from discontinued operations - basic $ — $ — $ 0.70 Earnings per share - basic $ 0.35 $ 0.62 $ 0.90 Earnings per share from continuing operations - diluted $ 0.34 $ 0.61 $ 0.20 Earnings per share from discontinued operations - diluted $ — $ — $ 0.67 Earnings per share - diluted $ 0.34 $ 0.61 $ 0.87 Noninterest Income (Unaudited) (Dollars in thousands) Quarterly 2024 2023 2023 First Quarter Fourth Quarter First Quarter Card acquiring income $ 251 $ 1,348 $ 622 Service charges on deposits 1,523 174 1,126 Interchange income 3,039 2,289 1,862 Total payment card and service charge income 4,813 3,811 3,610 Equity method investments loss (1,128 ) (2,429 ) (1,193 ) Compliance and consulting income 1,000 986 1,016 Gain (loss) on sale of loans — 271 (356 ) Investment portfolio gains (losses) 609 75 (1,844 ) Other noninterest income 2,540 1,724 1,834 Total noninterest income $ 7,834 $ 4,438 $ 3,067 Condensed Consolidated Balance Sheets (Unaudited) (Dollars in thousands) March 31, 2024 December 31, 2023 March 31, 2023 Cash and cash equivalents $ 640,426 $ 398,229 $ 575,265 Securities available-for-sale, at fair value 349,678 345,275 339,578 Equity securities 41,037 41,086 38,576 Loans held-for-sale — 629 19,893 Loans receivable 2,267,310 2,317,594 2,361,153 Less: Allowance for credit losses (22,804 ) (22,124 ) (35,513 ) Loans receivable, net 2,244,506 2,295,470 2,325,640 Premises and equipment, net 19,968 20,928 22,869 Goodwill — — — Other assets 251,775 212,265 230,055 Total assets $ 3,547,390 $ 3,313,882 $ 3,551,876 Noninterest-bearing deposits $ 1,391,070 $ 1,197,272 $ 1,134,257 Interest-bearing deposits 1,754,259 1,704,204 2,016,558 Senior term loan 6,549 6,786 9,647 Subordinated debt 73,602 73,540 73,350 Other liabilities 30,082 42,738 46,748 Stockholders' equity 291,828 289,342 271,316 Total liabilities and stockholders' equity $ 3,547,390 $ 3,313,882 $ 3,551,876 Reportable Segments (Unaudited) Three Months Ended March 31, 2024 CoRe Banking Mortgage Banking Financial Holding Company Other Intercompany Eliminations Consolidated (Dollars in thousands) Interest income $ 49,942 $ 103 $ 2 $ — $ (17 ) $ 50,030 Interest expense 18,927 — 959 22 (17 ) 19,891 Net interest income (expense) 31,015 103 (957 ) (22 ) — 30,139 Provision for credit losses 1,997 — — — — 1,997 Net interest income (expense) after provision for credit losses 29,018 103 (957 ) (22 ) — 28,142 Noninterest income 7,521 (1,129 ) 2,265 3,264 (4,087 ) 7,834 Noninterest Expenses: Salaries and employee benefits 9,823 — 4,678 1,988 — 16,489 Other expenses 13,821 — 1,841 2,127 (4,087 ) 13,702 Total noninterest expenses 23,644 — 6,519 4,115 (4,087 ) 30,191 Income (loss), before income taxes 12,895 (1,026 ) (5,211 ) (873 ) — 5,785 Income taxes 2,878 (229 ) (1,157 ) (209 ) — 1,283 Net income (loss), before noncontrolling interest 10,017 (797 ) (4,054 ) (664 ) — 4,502 Net income attributable to noncontrolling interest — — — (20 ) — (20 ) Net income (loss) available to common shareholders $ 10,017 $ (797 ) $ (4,054 ) $ (684 ) $ — $ 4,482 Three Months Ended December 31, 2023 CoRe Banking Mortgage Banking Financial Holding Company Other Intercompany Eliminations Consolidated (Dollars in thousands) Interest income $ 49,639 $ 103 $ 3 $ — $ (46 ) $ 49,699 Interest expense 17,573 — 993 72 (46 ) 18,592 Net interest income (expense) 32,066 103 (990 ) (72 ) — 31,107 Provision for credit losses (2,103 ) — — — — (2,103 ) Net interest income (expense) after provision for credit losses 34,169 103 (990 ) (72 ) — 33,210 Noninterest income 5,175 (2,430 ) 2,351 3,204 (3,862 ) 4,438 Noninterest Expenses: Salaries and employee benefits 9,374 — 3,339 2,150 — 14,863 Other expenses 13,318 — 2,161 1,821 (3,862 ) 13,438 Total noninterest expenses 22,692 — 5,500 3,971 (3,862 ) 28,301 Income (loss) before income taxes 16,652 (2,327 ) (4,139 ) (839 ) — 9,347 Income taxes 3,962 (543 ) (1,796 ) (192 ) — 1,431 Net income (loss), before noncontrolling interest 12,690 (1,784 ) (2,343 ) (647 ) — 7,916 Net income attributable to noncontrolling interest — — — (5 ) — (5 ) Net income (loss) available to common shareholders $ 12,690 $ (1,784 ) $ (2,343 ) $ (652 ) $ — $ 7,911 Three Months Ended March 31, 2023 CoRe Banking Mortgage Banking Financial Holding Company Other Intercompany Eliminations Consolidated (Dollars in thousands) Interest income $ 44,662 $ 105 $ 33 $ (6 ) $ (31 ) $ 44,763 Interest expense 11,041 — 993 31 (31 ) 12,034 Net interest income (expense) 33,621 105 (960 ) (37 ) — 32,729 Provision for credit losses 4,576 — — — — 4,576 Net interest income (expense) after provision for credit losses 29,045 105 (960 ) (37 ) — 28,153 Noninterest income 3,018 (1,186 ) 2,410 1,784 (2,959 ) 3,067 Noninterest Expenses: Salaries and employee benefits 9,051 — 4,950 2,745 — 16,746 Other expenses 11,054 34 1,917 1,525 (2,959 ) 11,571 Total noninterest expenses 20,105 34 6,867 4,270 (2,959 ) 28,317 Income (loss), before income taxes 11,958 (1,115 ) (5,417 ) (2,523 ) — 2,903 Income taxes 2,515 (504 ) (942 ) (604 ) — 465 Net income (loss) from continuing operations 9,443 (611 ) (4,475 ) (1,919 ) — 2,438 Income from discontinued operations, before income taxes — — — 11,831 — 11,831 Income tax expense - discontinued operations — — — 3,049 — 3,049 Net income from discontinued operations — — — 8,782 — 8,782 Net income (loss), before noncontrolling interest 9,443 (611 ) (4,475 ) 6,863 — 11,220 Net loss attributable to noncontrolling interest — — — 122 — 122 Net income (loss) available to common shareholders $ 9,443 $ (611 ) $ (4,475 ) $ 6,985 $ — $ 11,342 Average Balances and Interest Rates (Unaudited) (Dollars in thousands) Three Months Ended Three Months Ended Three Months Ended March 31, 2024 December 31, 2023 March 31, 2023 Average Balance Interest Income/ Expense Yield/ Cost Average Balance Interest Income/ Expense Yield/ Cost Average Balance Interest Income/ Expense Yield/ Cost Assets Interest-bearing balances with banks $ 549,894 $ 7,341 5.37 % $ 442,521 $ 5,944 5.33 % $ 285,102 $ 3153 4.49 % Investment securities: Taxable 246,091 1,743 2.85 222,303 1,444 2.58 236,574 1,848 3.17 Tax-exempt 1 106,309 887 3.36 98,464 876 3.53 137,799 1,308 3.85 Loans and loans held-for-sale: 2 Commercial 1,626,286 32,152 7.95 1,635,510 33,665 8.17 1,620,509 28,538 7.14 Tax-exempt 1 3,373 37 4.41 3,492 38 4.32 3,944 43 4.42 Real estate 576,148 6,612 4.62 576,580 6,421 4.42 621,388 6,295 4.11 Consumer 77,300 1,452 7.55 76,088 1,503 7.84 137,547 3,862 11.39 Total loans 2,283,107 40,253 7.09 2,291,670 41,627 7.21 2,383,388 38,738 6.59 Total earning assets 3,185,401 50,224 6.34 3,054,958 49,891 6.48 3,042,863 45,047 6.00 Less: Allowance for credit losses (22,258 ) (24,079 ) (30,135 ) Cash and due from banks 5,405 5,771 243 Other assets 335,029 292,574 339,676 Total assets $ 3,503,577 $ 3,329,224 $ 3,352,647 Liabilities Deposits: NOW $ 555,530 $ 4,929 3.57 % $ 637,144 $ 5,386 3.35 % $ 796,901 $ 4,661 2.37 % Money market checking 408,764 3,759 3.70 650,925 3,691 2.25 209,227 928 1.80 Savings 163,611 1,640 4.03 70,146 442 2.50 93,297 641 2.79 IRAs 7,762 74 3.83 7,296 66 3.59 6,151 27 1.78 CDs 674,611 8,529 5.08 590,517 8,014 5.38 386,144 3,896 4.09 Repurchase agreements and federal funds sold 2,951 — — 4,736 — — 7,612 1 0.05 FHLB and other borrowings 44 1 9.14 11 — — 71,166 888 5.06 Senior term loan 6,736 150 8.96 8,183 183 8.87 9,765 194 8.06 Subordinated debt 73,571 809 4.42 73,510 810 4.37 73,318 798 4.41 Total interest-bearing liabilities 1,893,580 19,891 4.22 2,042,468 18,592 3.61 1,653,581 12,034 2.95 Noninterest-bearing demand deposits 1,279,194 975,122 1,380,516 Other liabilities 42,017 39,410 37,087 Total liabilities 3,214,791 3,057,000 3,071,184 Stockholders’ equity Common stock 13,659 13,588 13,471 Paid-in capital 161,532 160,106 153,389 Treasury stock (16,741 ) (16,741 ) (16,741 ) Retained earnings 160,933 156,004 166,426 Accumulated other comprehensive loss (30,559 ) (40,688 ) (35,345 ) Total stockholders’ equity attributable to parent 288,824 272,269 281,200 Noncontrolling interest (38 ) (45 ) 263 Total stockholders’ equity 288,786 272,224 281,463 Total liabilities and stockholders’ equity $ 3,503,577 $ 3,329,224 $ 3,352,647 Net interest spread (tax-equivalent) 2.12 % 2.87 % 3.05 % Net interest income and margin (tax-equivalent)1 $ 30,333 3.83 % $ 31,299 4.06 % $ 33,013 4.40 % Less: Tax-equivalent adjustments $ (194 ) $ (193 ) $ (284 ) Net interest spread 2.10 % 2.84 % 3.02 % Net interest income and margin $ 30,139 3.81 % $ 31,107 4.04 % $ 32,729 4.36 % 1In order to make pre-tax income and resultant yields on tax-exempt loans and investment securities comparable to those on taxable loans and investment securities, a tax-equivalent adjustment has been computed using a Federal tax rate of 21% for the periods presented, which is a non-GAAP financial measure. See the reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure included in the tables on page 17. 2 Non-accrual loans are included in total loan balances, lowering the effective yield for the portfolio in the aggregate. Selected Financial Data (Unaudited) (Dollars in thousands, except per share data) Quarterly 2024 2023 2023 First Quarter Fourth Quarter First Quarter Earnings and Per Share Data: Net income $ 4,482 $ 7,911 $ 11,342 Earnings per share from continuing operations - basic $ 0.35 $ 0.62 $ 0.20 Earnings per share from discontinued operations - basic $ — $ — $ 0.70 Earnings per share - basic $ 0.35 $ 0.62 $ 0.90 Earnings per share from continuing operations - diluted $ 0.34 $ 0.61 $ 0.20 Earnings per share from discontinued operations - diluted $ — $ — $ 0.67 Earnings per share - diluted $ 0.34 $ 0.61 $ 0.87 Cash dividends paid per common share $ 0.17 $ 0.17 $ 0.17 Book value per common share $ 22.73 $ 22.68 $ 21.43 Tangible book value per common share 1 $ 22.48 $ 22.43 $ 21.17 Weighted-average shares outstanding - basic 12,810,956 12,740,193 12,623,361 Weighted-average shares outstanding - diluted 13,119,292 13,024,562 13,016,082 Performance Ratios: Return on average assets 2 0.5 % 1.0 % 1.4 % Return on average equity 2 6.2 % 11.6 % 16.1 % Net interest margin 3 4 3.83 % 4.06 % 4.40 % Efficiency ratio 5 79.5 % 79.6 % 61.4 % Overhead ratio 2 6 3.4 % 3.4 % 3.4 % Equity to assets 8.2 % 8.7 % 7.6 % Asset Quality Data and Ratios: Charge-offs $ 2,150 $ 1,868 $ 4,847 Recoveries $ 835 $ 1,343 $ 3,169 Net loan charge-offs to total loans 2 7 0.2 % 0.1 % 0.3 % Allowance for credit losses $ 22,804 $ 22,124 $ 35,513 Allowance for credit losses to total loans 8 1.01 % 0.95 % 1.50 % Nonperforming loans $ 7,546 $ 8,267 $ 13,085 Nonperforming loans to total loans 0.3 % 0.4 % 0.6 % Mortgage Company Equity Method Investees Production Data9: Mortgage pipeline $ 790,771 $ 706,873 $ 714,258 Loans originated $ 1,050,089 $ 1,020,128 $ 232,660 Loans closed $ 653,306 $ 724,453 $ 385,011 Loans sold $ 916,115 $ 639,788 $ 302,782 1 Common equity less total goodwill and intangibles per common share, a non-U.S. GAAP measure. See the reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure included in the tables on page 17. 2 Annualized for the quarterly periods presented. 3 Net interest income as a percentage of average interest-earning assets. 4 Presented on a fully tax-equivalent basis, a non-GAAP financial measure. 5 Noninterest expense as a percentage of net interest income and noninterest income, a non-U.S. GAAP measure. 6 Noninterest expense as a percentage of average assets, a non-U.S. GAAP measure. 7 Charge-offs, less recoveries. 8 Excludes loans held-for-sale. 9 Information is related to Intercoastal Mortgage Company, LLC and Warp Speed Holdings LLC, entities in which MVB has an ownership interest that are accounted for as equity method investments. Non-GAAP Reconciliation: Net Interest Margin on a Full Tax-Equivalent Basis The following table reconciles, for the periods shown below, net interest margin on a fully tax-equivalent basis: Three Months Ended (Dollars in thousands) March 31, 2024 December 31, 2023 March 31, 2023 Net interest margin - U.S. GAAP basis Net interest income $ 30,139 $ 31,107 $ 32,729 Average interest-earning assets $ 3,185,401 $ 3,054,958 $ 3,042,863 Net interest margin 3.81 % 4.04 % 4.36 % Net interest margin - non-U.S. GAAP basis Net interest income $ 30,139 $ 31,107 $ 32,729 Impact of fully tax-equivalent adjustment 194 193 284 Net interest income on a fully tax-equivalent basis $ 30,333 $ 31,299 $ 33,013 Average interest-earning assets $ 3,185,401 $ 3,054,958 $ 3,042,863 Net interest margin on a fully tax-equivalent basis 3.83 % 4.06 % 4.40 % Non-U.S. GAAP Reconciliation: Tangible Book Value per Common Share and Tangible Common Equity Ratio (Unaudited) (Dollars in thousands, except per share data) March 31, 2024 December 31, 2023 March 31, 2023 Tangible Book Value per Common Share Goodwill $ 2,838 $ 2,838 $ 2,838 Intangibles 330 352 420 Total intangibles $ 3,168 3,190 3,258 Total equity attributable to parent $ 291,850 289,384 271,131 Less: Total intangibles (3,168 ) (3,190 ) (3,258 ) Tangible common equity $ 288,682 $ 286,194 $ 267,873 Tangible common equity $ 288,682 $ 286,194 $ 267,873 Common shares outstanding (000s) 12,841 12,758 12,653 Tangible book value per common share $ 22.48 $ 22.43 $ 21.17 Tangible Common Equity Ratio Total assets $ 3,547,390 $ 3,313,882 $ 3,551,876 Less: Total intangibles (3,168 ) (3,190 ) (3,258 ) Tangible assets $ 3,544,222 $ 3,310,692 $ 3,548,618 Tangible assets $ 3,544,222 $ 3,310,692 $ 3,548,618 Tangible common equity $ 288,682 $ 286,194 $ 267,873 Tangible common equity ratio 8.1 % 8.6 % 7.5 % View source version on businesswire.com: https://www.businesswire.com/news/home/20240429858018/en/Contacts Questions or comments concerning this earnings release should be directed to: MVB Financial Corp. Donald T. Robinson, President and Chief Financial Officer (304) 598-3500 drobinson@mvbbanking.com Amy Baker, VP, Corporate Communications and Marketing (844) 682-2265 abaker@mvbbanking.com
MVB Financial Corp. (NASDAQ: MVBF) (“MVB Financial,” “MVB” or the “Company”), the holding company for MVB Bank, Inc. ("MVB Bank"), today announced financial results for the first quarter of 2024, with reported net income of $4.5 million, or $0.35 basic and $0.34 diluted earnings per share. First Quarter 2024 Highlights As Compared to Fourth Quarter 2023 Total revenue increased 6.8%, or $2.4 million. Fintech fee income grew 26.3%, or $1.0 million. Noninterest bearing deposits increased 16.2%, or $193.8 million, and represent 44% of total deposits. Nonperforming loans declined 8.7%; Measures of asset quality and capital strength were stable. Book value per share and tangible book value per share, a non-GAAP financial measure, each increased by 0.2% to $22.73 and $22.48, respectively. From Larry F. Mazza, Chief Executive Officer, MVB Financial: “Turbulence in financial markets and the banking sector persisted during the first quarter of 2024. Amidst these volatile market conditions, MVB made progress on several key initiatives. Most notably, we further solidified foundational measures of safety and soundness. Our balance sheet liquidity position and the quality of our funding mix improved, asset quality indicators were stable, commercial real estate concentrations remained well within regulatory guidelines and measures of capital strength were maintained. We also remained proactive in investing at a higher-than-normal pace to contend with changing regulatory requirements following the industry events of early 2023. These higher costs, alongside other cyclical and seasonal challenges, weighed on our earnings for the first quarter. “At the same time, initiatives to drive revenue growth are bearing fruit. Banking-as-a-service fee income increased from the prior quarter and the year-ago period, benefiting from seasonal considerations, notably the influence of tax season, and growth in the underlying business. Through these challenging times for the banking sector, I’m pleased and encouraged by the adaptability of the MVB Team and the resilience of our business model.” FIRST QUARTER 2024 HIGHLIGHTS Strong core deposit growth. Total deposits increased 8.4%, or $243.9 million, to $3.15 billion, compared to the prior quarter-end, primarily reflecting strong growth in noninterest bearing (“NIB”) deposits. Growth also reflected strength in Banking-as-a-Service (“BaaS”) deposits and increased balances due to seasonal tax volume and deposits tied to payment relationships. Total off-balance sheet deposits increased to $1.53 billion as compared to $1.09 billion at the prior quarter-end. Off-balance sheet deposit networks are utilized to generate fee income, enhance capital efficiency and manage liquidity and concentration risk. NIB deposits increased 16.2%, or $193.8 million, and 22.6%, or $256.8 million, to $1.39 billion, as compared to the prior quarter-end and the year-ago period, respectively. NIB deposit growth relative to the prior quarter primarily reflected seasonal tax deposits and growth in customer business volume. NIB deposits represented 44.2% of total deposits, as compared to 41.3% of total deposits at the prior quarter-end, and 36.0% for the year-ago period. Certificate of deposit (“CD”) balances, which include brokered deposits, increased 18.7%, or $109.5 million, to $696.3 million, from the prior quarter-end. The loan-to-deposit ratio was 72.1% as of March 31, 2024, compared to 79.9% as of December 31, 2023 and 74.9% as of March 31, 2023. The decline in the loan-to-deposit ratio reflects the increase in deposits, primarily due to our BaaS business, combined with a decline in loan balances driven by market conditions. Fintech fee income growth drove quarter and year-over-year growth in noninterest income and total revenues. Payment card and service charge income, which includes BaaS fee income, increased by 26.3% and 33.3% as compared to the prior quarter and the year-ago period, respectively. Growth relative to the prior quarter primarily related to increased transactional volume due to seasonal tax deposits and expanded relationships with our Fintech partners. Growth relative to the prior year is primarily related to the increased transactional volume from seasonal tax deposits year over year. Total noninterest income grew 76.5%, or $3.4 million, relative to the prior quarter, to $7.8 million, primarily reflecting higher payment card and service charge income and a decline in the loss on equity method investments (mortgage banking). Relative to the prior year, total noninterest income grew 155.4%, or $4.8 million, reflecting higher payment card and service charge income and higher other operating income. Total revenues increased $2.4 million, or 6.8%, and $2.2 million, or 6.1%, relative to the prior quarter and the year-ago period, respectively. Revenue growth relative to both prior periods reflected higher noninterest income partially offset by lower net interest income. Net interest income declined on a slowdown in loan growth, net interest margin contraction and seasonal considerations. Net interest income on a fully tax-equivalent basis, a non-GAAP financial measure, declined 3.1%, or $1.0 million, to $30.3 million relative to the prior quarter, reflecting net interest margin contraction, partially offset by an increase in total average earning asset balances. Net interest margin on a fully tax-equivalent basis, a non-GAAP financial measure, was 3.83%, down 23 basis points from the prior quarter, primarily reflecting higher interest rates on deposits and elevated deposit balances driven by seasonal considerations associated with a BaaS relationship, in addition to a decline in average loan balances due to market conditions. Total cost of funds was 2.52%, up eight basis points compared to the prior quarter, primarily reflecting an increase in balances due to seasonal tax deposits. Average earning asset balances increased 4.3% from the prior quarter, reflecting higher interest-bearing balances with banks and higher investment securities balances, partially offset by lower average loan balances. Average total loan balances declined 0.4% from the prior quarter, reflecting slower market demand and deliberate efforts to improve balance sheet liquidity. Measures of safety and soundness were generally stable. The Community Bank Leverage Ratio, Tier 1 Risk-Based Capital Ratio and MVB Bank’s Total Risk-Based Capital Ratio were 10.1%, 14.4%, and 15.2%, respectively, compared to 10.5%, 14.4%, and 15.1%, respectively, at the prior quarter end. Tangible book value per share, a non-U.S. GAAP measure discussed below, increased 0.2% to $22.48, relative to the prior quarter-end, and increased 6.2% from the year-ago period. Nonperforming loans declined $0.7 million, or 8.7%, to $7.5 million, or 0.3% of total loans, from $8.3 million, or 0.4% of total loans, at the prior quarter end. Criticized loans as a percentage of total loans were 5.8%, as compared to 5.3% at the prior quarter end. Net charge-offs were $1.3 million, or 0.2%, for the first quarter of 2024, compared to $0.5 million, or 0.1%, for the prior quarter. For the first quarter of 2024, net charge-offs included $0.6 million related to a SBA loan secured by business assets, $0.5 million related to the subprime consumer automotive segment and $0.4 million related to a commercial client in the energy industry. The provision for credit losses totaled $2.0 million, compared to a release of allowance of $2.1 million for the prior quarter. The allowance for credit losses was 1.01% of total loans, as compared to 0.95% at the prior quarter end. Expenses higher due to employee compensation and continued investment spend to enhance regulatory and compliance infrastructure. Noninterest expense increased 6.7% to $30.2 million relative to the prior quarter, primarily reflecting an increase in employee benefits and continued elevated professional fees and other operating costs to enhance risk management and compliance-related infrastructure in response to changing regulatory requirements following the industry events of March 2023. INCOME STATEMENT Net interest income on a tax-equivalent basis totaled $30.3 million for the first quarter of 2024, a decline of $1.0 million, or 3.1%, from the fourth quarter of 2023 and $2.7 million, or 8.1%, from the first quarter of 2023. The decline from both prior periods reflects a lower net interest margin, partially offset by higher average earning balances. Interest income increased $0.3 million, or 0.7%, from the fourth quarter of 2023 and increased $5.3 million, or 11.8%, from the first quarter of 2023. Relative to the prior quarter, the slight increase primarily reflects higher interest income from cash balances due to seasonal considerations and increased interest income from investment securities, mostly offset by a decline in interest income from loans, driven by lower loan balances and a lower tax-equivalent yield on loans. Relative to the prior year, higher interest income reflects the cumulative impact of earning assets booked at higher yields than the prevailing portfolio yield in the prior period and the repricing of variable rate loans in a higher interest rate environment. Interest expense increased $1.3 million, or 7.0%, from the fourth quarter of 2023 and $7.9 million, or 65.3%, from the first quarter of 2023. The cost of funds was 2.52% for the first quarter of 2024, up from 2.44% for the fourth quarter of 2023 and 1.59% for the first quarter of 2023. Relative to the prior quarter, higher interest expense primarily reflects higher interest rates on deposits and seasonal increases in deposits due to tax season driven by a BaaS relationship. Relative to the year-ago period, the increase reflects the impact of higher interest rates on our deposits. On a tax-equivalent basis, net interest margin for the first quarter of 2024 was 3.83%, a decline of 23 basis points versus the fourth quarter of 2023 and 57 basis points versus the first quarter of 2023. See the table below for a reconciliation between net interest margin and net interest margin on a fully tax-equivalent basis, a non-GAAP measure. Contraction in net interest margin from the prior quarter primarily reflects an unfavorable shift in the mix of average earning assets, including lower loan balances, higher cash and investment securities balances with lower yields and higher funding costs driven by the volume of deposits and higher interest rates on deposits associated with a BaaS relationship. Relative to the year-ago period, the contraction in net interest margin reflects higher funding costs, which have significantly outpaced the increase in average earning asset yields. Noninterest income totaled $7.8 million for the first quarter of 2024, an increase of $3.4 million from the fourth quarter of 2023 and $4.8 million from the first quarter of 2023. The increase compared to the prior quarter is primarily driven by a decline of $1.3 million in equity method investment losses from our mortgage segment, an increase of $1.0 million in payment card and service charge income and a $0.7 million in gain on sale of available-for-sale investment securities. Additionally, the fourth quarter of 2023 included a $0.7 million loss on derivatives without a comparable loss in the first quarter of 2024 and a $0.3 million gain on sale of loans without a comparable gain in the first quarter of 2024. The $4.8 million increase in noninterest income from the first quarter of 2023 was primarily driven by increases of $1.2 million in payment card and service charge income and $0.6 million in other operating income. There was a gain on sale of available-for-sale investment securities of $0.7 million during the first quarter of 2024, as compared to a loss of $1.5 million in the first quarter of 2023. Additionally, there was a decline in holding loss on equity securities of $0.3 million, and the first quarter of 2023 included a $0.4 million loss on sale of loans without a comparable loss in the first quarter of 2024. Noninterest expense totaled $30.2 million for the first quarter of 2024, an increase of $1.9 million, or 6.7%, from the fourth quarter of 2023 and $1.9 million, or 6.6%, from the first quarter of 2023. The increase from the fourth quarter of 2023 primarily reflects an increase in salaries and employee benefits of $1.6 million, or 10.9%. The increase from the first quarter of 2023 primarily reflects an increase of $2.8 million in professional fees, partially offset by decreases of $0.4 million in other operating expense, $0.4 million in travel, entertainment, dues and subscriptions and $0.3 million in salaries and employee benefit expense. BALANCE SHEET Loans totaled $2.27 billion at March 31, 2024, a decline of $50.3 million, or 2.2%, and $93.8 million, or 4.0%, as compared to December 31, 2023 and March 31, 2023, respectively. The decline in loan balances compared to the prior quarters primarily reflects lower market demand, the impact of loan amortization and payoffs and slower loan growth based on overall market conditions and portfolio management. Deposits totaled $3.15 billion as of March 31, 2024, an increase of $243.9 million, or 8.4%, from December 31, 2023, and a decline of $5.5 million, or 0.2%, from March 31, 2023. Relative to the prior quarter, deposit growth reflected strong growth in NIB deposits and seasonal considerations due to tax season driven by a BaaS relationship. Relative to the year-ago period, the decline reflects the increased utilization of off-balance sheet deposit networks to generate fee income, enhance capital efficiency and manage liquidity and concentration risk, partially offset by the increase in NIB deposits. NIB deposits totaled $1.39 billion as of March 31, 2024, an increase of $193.8 million, or 16.2%, from December 31, 2023 and an increase of $256.8 million, or 22.6%, from March 31, 2023. Relative to both prior periods, growth in NIB deposits reflected growth in customer business volume and, for the immediately preceding quarter, seasonal considerations. NIB deposits represented 44.2% of total deposits, compared to 41.3% of total deposits at the prior quarter-end, and 36.0% for the year-ago period. CAPITAL The Community Bank Leverage Ratio was 10.1% as of March 31, 2024, compared to 10.5% as of December 31, 2023 and 10.0% as of March 31, 2023. MVB’s Tier 1 Risk-Based Capital Ratio was 14.4% as of March 31, 2024, compared to 14.4% as of December 31, 2023 and 13.7% as of March 31, 2023. The Bank’s Total Risk-Based Capital Ratio was 16.04% as of March 31, 2024, compared to 15.1% as of December 31, 2023 and 14.9% as of March 31, 2023. The tangible common equity ratio, a non-GAAP financial measure, was 8.1% as of March 31, 2024, compared to 8.6% as of December 31, 2023 and 7.5% as of as of March 31, 2023. See the reconciliation of the tangible common equity ratio to its most directly comparable U.S. GAAP financial measure later in this release. The Company issued a quarterly cash dividend of $0.17 per share for the first quarter of 2024, consistent with the fourth quarter of 2023 and the first quarter of 2023. ASSET QUALITY Nonperforming loans totaled $7.5 million, or 0.3% of total loans, as of March 31, 2024, as compared to $8.3 million, or 0.4% of total loans, as of December 31, 2023, and $13.1 million, or 0.6% of total loans, as of March 31, 2023. Criticized loans as a percentage of total loans were 5.8%, compared to 5.3% as of December 31, 2023 and 3.6% as of March 31, 2023. Net charge-offs were $1.3 million, or 0.2% of total loans, for the first quarter of 2024, compared to $0.5 million, or 0.1% of total loans, for the fourth quarter of 2023 and $1.7 million, or 0.3% of total loans, for the first quarter of 2023. The provision for credit losses totaled $2.0 million compared to a $2.1 million release of allowance for the prior quarter ended December 31, 2023, and provision of $4.6 million for the quarter ended March 31, 2023. The allowance for credit losses was 1.01% of total loans at March 31, 2024, as compared to 0.95% at December 31, 2023 and 1.50% at March 31, 2023. About MVB Financial Corp. MVB Financial, the holding company of MVB Bank, is publicly traded on The Nasdaq Capital Market® (“Nasdaq”) under the ticker “MVBF.” MVB is a financial holding company headquartered in Fairmont, West Virginia. Through its subsidiary, MVB Bank, and MVB Bank’s subsidiaries, MVB Financial provides financial services to individuals and corporate clients in the Mid-Atlantic region and beyond. Nasdaq is a leading global provider of trading, clearing, exchange technology, listing, information and public company services. For more information about MVB, please visit ir.mvbbanking.com. Forward-looking Statements MVB Financial has made forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, in this press release that are intended to be covered by the protections provided under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations about the future and are subject to risks and uncertainties. Forward-looking statements include, without limitation, information concerning possible or assumed future results of operations of the Company and its subsidiaries. Forward-looking statements can be identified by the use of words such as “may,” “could,” “should,” “would,” “will,” “plans,” “believes,” “estimates,” “expects,” “anticipates,” “intends,” “continues” or the negative of those terms or similar expressions. Note that many factors could affect the future financial results of the Company and its subsidiaries, both individually and collectively, and could cause those results to differ materially from those expressed in forward-looking statements. Therefore, undue reliance should not be placed upon any forward-looking statements. Those factors include but are not limited to: market, economic, operational, liquidity and credit risk; changes in market interest rates; impacts related to or resulting from recent turmoil in the banking industry; inability to successfully execute business plans, including strategies related to investments in Fintech companies; competition; unforeseen events, such as pandemics or natural disasters, and any governmental or societal responses thereto; changes in economic, business and political conditions; changes in demand for loan products and deposit flow; operational risks and risk management failures; and government regulation and supervision. Additional factors that may cause actual results to differ materially from those described in the forward-looking statements can be found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as well as its other filings with the Securities and Exchange Commission (“SEC”), which are available on the SEC’s website at www.sec.gov. Except as required by law, the Company disclaims any obligation to update, revise or correct any forward-looking statements. Accounting standards require the consideration of subsequent events occurring after the balance sheet date for matters that require adjustment to, or disclosure in, the consolidated financial statements. The review period for subsequent events extends up to and including the filing date of a public company’s financial statements when filed with the SEC. Accordingly, the consolidated financial information in this announcement is subject to change. Non-U.S. GAAP Financial Measures This document contains supplemental financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Management uses these non-U.S. GAAP measures in its analysis of the Company’s performance. These measures should not be considered a substitute for U.S. GAAP basis measures nor should they be viewed as a substitute for operating results determined in accordance with U.S. GAAP. Management believes the presentation of non-U.S. GAAP financial measures that exclude the impact of specified items provide useful supplemental information that is essential to a proper understanding of the Company’s financial condition and results. Non-U.S. GAAP measures are not formally defined under U.S. GAAP, and other entities may use calculation methods that differ from those used by us. As a complement to U.S. GAAP financial measures, our management believes these non-U.S. GAAP financial measures assist investors in comparing the financial condition and results of operations of financial institutions due to the industry prevalence of such non-U.S. GAAP measures. See the tables below for a reconciliation of these non-U.S. GAAP measures to the most directly comparable U.S. GAAP financial measures. MVB Financial Corp. Financial Highlights Consolidated Statements of Income (Unaudited) (Dollars in thousands, except per share data) Quarterly 2024 2023 2023 First Quarter Fourth Quarter First Quarter Interest income $ 50,030 $ 49,699 $ 44,763 Interest expense 19,891 18,592 12,034 Net interest income 30,139 31,107 32,729 Provision (release of allowance) for credit losses 1,997 (2,103 ) 4,576 Net interest income after provision (release of allowance) for credit losses 28,142 33,210 28,153 Total noninterest income 7,834 4,438 3,067 Noninterest expense: Salaries and employee benefits 16,489 14,863 16,746 Other expense 13,702 13,438 11,571 Total noninterest expenses 30,191 28,301 28,317 Income before income taxes 5,785 9,347 2,903 Income taxes 1,283 1,431 465 Net income from continuing operations, before noncontrolling interest 4,502 7,916 2,438 Income from discontinued operations, before income taxes — — 11,831 Income taxes - discontinued operations — — 3,049 Net income from discontinued operations — — 8,782 Net Income, before noncontrolling interest 4,502 7,916 11,220 Net (income) loss attributable to noncontrolling interest (20 ) (5 ) 122 Net income available to common shareholders $ 4,482 $ 7,911 $ 11,342 Earnings per share from continuing operations - basic $ 0.35 $ 0.62 $ 0.20 Earnings per share from discontinued operations - basic $ — $ — $ 0.70 Earnings per share - basic $ 0.35 $ 0.62 $ 0.90 Earnings per share from continuing operations - diluted $ 0.34 $ 0.61 $ 0.20 Earnings per share from discontinued operations - diluted $ — $ — $ 0.67 Earnings per share - diluted $ 0.34 $ 0.61 $ 0.87 Noninterest Income (Unaudited) (Dollars in thousands) Quarterly 2024 2023 2023 First Quarter Fourth Quarter First Quarter Card acquiring income $ 251 $ 1,348 $ 622 Service charges on deposits 1,523 174 1,126 Interchange income 3,039 2,289 1,862 Total payment card and service charge income 4,813 3,811 3,610 Equity method investments loss (1,128 ) (2,429 ) (1,193 ) Compliance and consulting income 1,000 986 1,016 Gain (loss) on sale of loans — 271 (356 ) Investment portfolio gains (losses) 609 75 (1,844 ) Other noninterest income 2,540 1,724 1,834 Total noninterest income $ 7,834 $ 4,438 $ 3,067 Condensed Consolidated Balance Sheets (Unaudited) (Dollars in thousands) March 31, 2024 December 31, 2023 March 31, 2023 Cash and cash equivalents $ 640,426 $ 398,229 $ 575,265 Securities available-for-sale, at fair value 349,678 345,275 339,578 Equity securities 41,037 41,086 38,576 Loans held-for-sale — 629 19,893 Loans receivable 2,267,310 2,317,594 2,361,153 Less: Allowance for credit losses (22,804 ) (22,124 ) (35,513 ) Loans receivable, net 2,244,506 2,295,470 2,325,640 Premises and equipment, net 19,968 20,928 22,869 Goodwill — — — Other assets 251,775 212,265 230,055 Total assets $ 3,547,390 $ 3,313,882 $ 3,551,876 Noninterest-bearing deposits $ 1,391,070 $ 1,197,272 $ 1,134,257 Interest-bearing deposits 1,754,259 1,704,204 2,016,558 Senior term loan 6,549 6,786 9,647 Subordinated debt 73,602 73,540 73,350 Other liabilities 30,082 42,738 46,748 Stockholders' equity 291,828 289,342 271,316 Total liabilities and stockholders' equity $ 3,547,390 $ 3,313,882 $ 3,551,876 Reportable Segments (Unaudited) Three Months Ended March 31, 2024 CoRe Banking Mortgage Banking Financial Holding Company Other Intercompany Eliminations Consolidated (Dollars in thousands) Interest income $ 49,942 $ 103 $ 2 $ — $ (17 ) $ 50,030 Interest expense 18,927 — 959 22 (17 ) 19,891 Net interest income (expense) 31,015 103 (957 ) (22 ) — 30,139 Provision for credit losses 1,997 — — — — 1,997 Net interest income (expense) after provision for credit losses 29,018 103 (957 ) (22 ) — 28,142 Noninterest income 7,521 (1,129 ) 2,265 3,264 (4,087 ) 7,834 Noninterest Expenses: Salaries and employee benefits 9,823 — 4,678 1,988 — 16,489 Other expenses 13,821 — 1,841 2,127 (4,087 ) 13,702 Total noninterest expenses 23,644 — 6,519 4,115 (4,087 ) 30,191 Income (loss), before income taxes 12,895 (1,026 ) (5,211 ) (873 ) — 5,785 Income taxes 2,878 (229 ) (1,157 ) (209 ) — 1,283 Net income (loss), before noncontrolling interest 10,017 (797 ) (4,054 ) (664 ) — 4,502 Net income attributable to noncontrolling interest — — — (20 ) — (20 ) Net income (loss) available to common shareholders $ 10,017 $ (797 ) $ (4,054 ) $ (684 ) $ — $ 4,482 Three Months Ended December 31, 2023 CoRe Banking Mortgage Banking Financial Holding Company Other Intercompany Eliminations Consolidated (Dollars in thousands) Interest income $ 49,639 $ 103 $ 3 $ — $ (46 ) $ 49,699 Interest expense 17,573 — 993 72 (46 ) 18,592 Net interest income (expense) 32,066 103 (990 ) (72 ) — 31,107 Provision for credit losses (2,103 ) — — — — (2,103 ) Net interest income (expense) after provision for credit losses 34,169 103 (990 ) (72 ) — 33,210 Noninterest income 5,175 (2,430 ) 2,351 3,204 (3,862 ) 4,438 Noninterest Expenses: Salaries and employee benefits 9,374 — 3,339 2,150 — 14,863 Other expenses 13,318 — 2,161 1,821 (3,862 ) 13,438 Total noninterest expenses 22,692 — 5,500 3,971 (3,862 ) 28,301 Income (loss) before income taxes 16,652 (2,327 ) (4,139 ) (839 ) — 9,347 Income taxes 3,962 (543 ) (1,796 ) (192 ) — 1,431 Net income (loss), before noncontrolling interest 12,690 (1,784 ) (2,343 ) (647 ) — 7,916 Net income attributable to noncontrolling interest — — — (5 ) — (5 ) Net income (loss) available to common shareholders $ 12,690 $ (1,784 ) $ (2,343 ) $ (652 ) $ — $ 7,911 Three Months Ended March 31, 2023 CoRe Banking Mortgage Banking Financial Holding Company Other Intercompany Eliminations Consolidated (Dollars in thousands) Interest income $ 44,662 $ 105 $ 33 $ (6 ) $ (31 ) $ 44,763 Interest expense 11,041 — 993 31 (31 ) 12,034 Net interest income (expense) 33,621 105 (960 ) (37 ) — 32,729 Provision for credit losses 4,576 — — — — 4,576 Net interest income (expense) after provision for credit losses 29,045 105 (960 ) (37 ) — 28,153 Noninterest income 3,018 (1,186 ) 2,410 1,784 (2,959 ) 3,067 Noninterest Expenses: Salaries and employee benefits 9,051 — 4,950 2,745 — 16,746 Other expenses 11,054 34 1,917 1,525 (2,959 ) 11,571 Total noninterest expenses 20,105 34 6,867 4,270 (2,959 ) 28,317 Income (loss), before income taxes 11,958 (1,115 ) (5,417 ) (2,523 ) — 2,903 Income taxes 2,515 (504 ) (942 ) (604 ) — 465 Net income (loss) from continuing operations 9,443 (611 ) (4,475 ) (1,919 ) — 2,438 Income from discontinued operations, before income taxes — — — 11,831 — 11,831 Income tax expense - discontinued operations — — — 3,049 — 3,049 Net income from discontinued operations — — — 8,782 — 8,782 Net income (loss), before noncontrolling interest 9,443 (611 ) (4,475 ) 6,863 — 11,220 Net loss attributable to noncontrolling interest — — — 122 — 122 Net income (loss) available to common shareholders $ 9,443 $ (611 ) $ (4,475 ) $ 6,985 $ — $ 11,342 Average Balances and Interest Rates (Unaudited) (Dollars in thousands) Three Months Ended Three Months Ended Three Months Ended March 31, 2024 December 31, 2023 March 31, 2023 Average Balance Interest Income/ Expense Yield/ Cost Average Balance Interest Income/ Expense Yield/ Cost Average Balance Interest Income/ Expense Yield/ Cost Assets Interest-bearing balances with banks $ 549,894 $ 7,341 5.37 % $ 442,521 $ 5,944 5.33 % $ 285,102 $ 3153 4.49 % Investment securities: Taxable 246,091 1,743 2.85 222,303 1,444 2.58 236,574 1,848 3.17 Tax-exempt 1 106,309 887 3.36 98,464 876 3.53 137,799 1,308 3.85 Loans and loans held-for-sale: 2 Commercial 1,626,286 32,152 7.95 1,635,510 33,665 8.17 1,620,509 28,538 7.14 Tax-exempt 1 3,373 37 4.41 3,492 38 4.32 3,944 43 4.42 Real estate 576,148 6,612 4.62 576,580 6,421 4.42 621,388 6,295 4.11 Consumer 77,300 1,452 7.55 76,088 1,503 7.84 137,547 3,862 11.39 Total loans 2,283,107 40,253 7.09 2,291,670 41,627 7.21 2,383,388 38,738 6.59 Total earning assets 3,185,401 50,224 6.34 3,054,958 49,891 6.48 3,042,863 45,047 6.00 Less: Allowance for credit losses (22,258 ) (24,079 ) (30,135 ) Cash and due from banks 5,405 5,771 243 Other assets 335,029 292,574 339,676 Total assets $ 3,503,577 $ 3,329,224 $ 3,352,647 Liabilities Deposits: NOW $ 555,530 $ 4,929 3.57 % $ 637,144 $ 5,386 3.35 % $ 796,901 $ 4,661 2.37 % Money market checking 408,764 3,759 3.70 650,925 3,691 2.25 209,227 928 1.80 Savings 163,611 1,640 4.03 70,146 442 2.50 93,297 641 2.79 IRAs 7,762 74 3.83 7,296 66 3.59 6,151 27 1.78 CDs 674,611 8,529 5.08 590,517 8,014 5.38 386,144 3,896 4.09 Repurchase agreements and federal funds sold 2,951 — — 4,736 — — 7,612 1 0.05 FHLB and other borrowings 44 1 9.14 11 — — 71,166 888 5.06 Senior term loan 6,736 150 8.96 8,183 183 8.87 9,765 194 8.06 Subordinated debt 73,571 809 4.42 73,510 810 4.37 73,318 798 4.41 Total interest-bearing liabilities 1,893,580 19,891 4.22 2,042,468 18,592 3.61 1,653,581 12,034 2.95 Noninterest-bearing demand deposits 1,279,194 975,122 1,380,516 Other liabilities 42,017 39,410 37,087 Total liabilities 3,214,791 3,057,000 3,071,184 Stockholders’ equity Common stock 13,659 13,588 13,471 Paid-in capital 161,532 160,106 153,389 Treasury stock (16,741 ) (16,741 ) (16,741 ) Retained earnings 160,933 156,004 166,426 Accumulated other comprehensive loss (30,559 ) (40,688 ) (35,345 ) Total stockholders’ equity attributable to parent 288,824 272,269 281,200 Noncontrolling interest (38 ) (45 ) 263 Total stockholders’ equity 288,786 272,224 281,463 Total liabilities and stockholders’ equity $ 3,503,577 $ 3,329,224 $ 3,352,647 Net interest spread (tax-equivalent) 2.12 % 2.87 % 3.05 % Net interest income and margin (tax-equivalent)1 $ 30,333 3.83 % $ 31,299 4.06 % $ 33,013 4.40 % Less: Tax-equivalent adjustments $ (194 ) $ (193 ) $ (284 ) Net interest spread 2.10 % 2.84 % 3.02 % Net interest income and margin $ 30,139 3.81 % $ 31,107 4.04 % $ 32,729 4.36 % 1In order to make pre-tax income and resultant yields on tax-exempt loans and investment securities comparable to those on taxable loans and investment securities, a tax-equivalent adjustment has been computed using a Federal tax rate of 21% for the periods presented, which is a non-GAAP financial measure. See the reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure included in the tables on page 17. 2 Non-accrual loans are included in total loan balances, lowering the effective yield for the portfolio in the aggregate. Selected Financial Data (Unaudited) (Dollars in thousands, except per share data) Quarterly 2024 2023 2023 First Quarter Fourth Quarter First Quarter Earnings and Per Share Data: Net income $ 4,482 $ 7,911 $ 11,342 Earnings per share from continuing operations - basic $ 0.35 $ 0.62 $ 0.20 Earnings per share from discontinued operations - basic $ — $ — $ 0.70 Earnings per share - basic $ 0.35 $ 0.62 $ 0.90 Earnings per share from continuing operations - diluted $ 0.34 $ 0.61 $ 0.20 Earnings per share from discontinued operations - diluted $ — $ — $ 0.67 Earnings per share - diluted $ 0.34 $ 0.61 $ 0.87 Cash dividends paid per common share $ 0.17 $ 0.17 $ 0.17 Book value per common share $ 22.73 $ 22.68 $ 21.43 Tangible book value per common share 1 $ 22.48 $ 22.43 $ 21.17 Weighted-average shares outstanding - basic 12,810,956 12,740,193 12,623,361 Weighted-average shares outstanding - diluted 13,119,292 13,024,562 13,016,082 Performance Ratios: Return on average assets 2 0.5 % 1.0 % 1.4 % Return on average equity 2 6.2 % 11.6 % 16.1 % Net interest margin 3 4 3.83 % 4.06 % 4.40 % Efficiency ratio 5 79.5 % 79.6 % 61.4 % Overhead ratio 2 6 3.4 % 3.4 % 3.4 % Equity to assets 8.2 % 8.7 % 7.6 % Asset Quality Data and Ratios: Charge-offs $ 2,150 $ 1,868 $ 4,847 Recoveries $ 835 $ 1,343 $ 3,169 Net loan charge-offs to total loans 2 7 0.2 % 0.1 % 0.3 % Allowance for credit losses $ 22,804 $ 22,124 $ 35,513 Allowance for credit losses to total loans 8 1.01 % 0.95 % 1.50 % Nonperforming loans $ 7,546 $ 8,267 $ 13,085 Nonperforming loans to total loans 0.3 % 0.4 % 0.6 % Mortgage Company Equity Method Investees Production Data9: Mortgage pipeline $ 790,771 $ 706,873 $ 714,258 Loans originated $ 1,050,089 $ 1,020,128 $ 232,660 Loans closed $ 653,306 $ 724,453 $ 385,011 Loans sold $ 916,115 $ 639,788 $ 302,782 1 Common equity less total goodwill and intangibles per common share, a non-U.S. GAAP measure. See the reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure included in the tables on page 17. 2 Annualized for the quarterly periods presented. 3 Net interest income as a percentage of average interest-earning assets. 4 Presented on a fully tax-equivalent basis, a non-GAAP financial measure. 5 Noninterest expense as a percentage of net interest income and noninterest income, a non-U.S. GAAP measure. 6 Noninterest expense as a percentage of average assets, a non-U.S. GAAP measure. 7 Charge-offs, less recoveries. 8 Excludes loans held-for-sale. 9 Information is related to Intercoastal Mortgage Company, LLC and Warp Speed Holdings LLC, entities in which MVB has an ownership interest that are accounted for as equity method investments. Non-GAAP Reconciliation: Net Interest Margin on a Full Tax-Equivalent Basis The following table reconciles, for the periods shown below, net interest margin on a fully tax-equivalent basis: Three Months Ended (Dollars in thousands) March 31, 2024 December 31, 2023 March 31, 2023 Net interest margin - U.S. GAAP basis Net interest income $ 30,139 $ 31,107 $ 32,729 Average interest-earning assets $ 3,185,401 $ 3,054,958 $ 3,042,863 Net interest margin 3.81 % 4.04 % 4.36 % Net interest margin - non-U.S. GAAP basis Net interest income $ 30,139 $ 31,107 $ 32,729 Impact of fully tax-equivalent adjustment 194 193 284 Net interest income on a fully tax-equivalent basis $ 30,333 $ 31,299 $ 33,013 Average interest-earning assets $ 3,185,401 $ 3,054,958 $ 3,042,863 Net interest margin on a fully tax-equivalent basis 3.83 % 4.06 % 4.40 % Non-U.S. GAAP Reconciliation: Tangible Book Value per Common Share and Tangible Common Equity Ratio (Unaudited) (Dollars in thousands, except per share data) March 31, 2024 December 31, 2023 March 31, 2023 Tangible Book Value per Common Share Goodwill $ 2,838 $ 2,838 $ 2,838 Intangibles 330 352 420 Total intangibles $ 3,168 3,190 3,258 Total equity attributable to parent $ 291,850 289,384 271,131 Less: Total intangibles (3,168 ) (3,190 ) (3,258 ) Tangible common equity $ 288,682 $ 286,194 $ 267,873 Tangible common equity $ 288,682 $ 286,194 $ 267,873 Common shares outstanding (000s) 12,841 12,758 12,653 Tangible book value per common share $ 22.48 $ 22.43 $ 21.17 Tangible Common Equity Ratio Total assets $ 3,547,390 $ 3,313,882 $ 3,551,876 Less: Total intangibles (3,168 ) (3,190 ) (3,258 ) Tangible assets $ 3,544,222 $ 3,310,692 $ 3,548,618 Tangible assets $ 3,544,222 $ 3,310,692 $ 3,548,618 Tangible common equity $ 288,682 $ 286,194 $ 267,873 Tangible common equity ratio 8.1 % 8.6 % 7.5 % View source version on businesswire.com: https://www.businesswire.com/news/home/20240429858018/en/
Questions or comments concerning this earnings release should be directed to: MVB Financial Corp. Donald T. Robinson, President and Chief Financial Officer (304) 598-3500 drobinson@mvbbanking.com Amy Baker, VP, Corporate Communications and Marketing (844) 682-2265 abaker@mvbbanking.com