On October 26, 2023, MVB Financial Corp (MVBF, Financial) announced its financial results for the third quarter of 2023. The company reported a net income of $3.9 million, or $0.30 basic and $0.29 diluted earnings per share. Despite volatile market conditions, the company managed to optimize its earnings power and grow low-cost deposits while reducing higher-cost funding.
Financial Highlights
Balance sheet deposits increased by 2.7%, or $80.0M, and noninterest bearing deposits increased by 10.8%, or $106.3M, representing 36% of deposits. The balance sheet loan to deposit ratio stood at 74.7%, compared to 78.1% in the previous quarter. Nonperforming loans decreased by 22.4%, or $3.1M, and the net interest margin improved by 10 bps, to 3.87%.
According to Larry F. Mazza, Chief Executive Officer, MVB Financial, the company continued to optimize its earnings power and grew low-cost deposits while reducing higher-cost funding. This strategy helped improve the company's strong liquidity position and net interest margin. The company also took steps to enhance its risk management and compliance infrastructure in anticipation of changing industry requirements.
Income Statement Summary
Net interest income on a fully tax-equivalent basis increased 0.9%, or $0.3 million, to $30.1 million relative to the prior quarter. The net interest margin on a fully tax-equivalent basis was 3.90%, up 10 basis points from the prior quarter. Noninterest expense increased 1.5% to $30.7 million relative to the prior quarter, primarily reflecting higher professional fees and other operating costs related to recent actions taken in response to the market events in March 2023.
Balance Sheet and Capital
Loans totaled $2.27 billion at the end of September 2023, a decrease of $42.0 million, or 1.8%, compared to June 2023. Deposits totaled $3.04 billion as of September 30, 2023, an increase of $80.0 million, or 2.7%, from June 2023. The Community Bank Leverage Ratio was 10.4% as of September 30, 2023, compared to 10.0% as of June 2023.
Asset Quality
Nonperforming loans totaled $10.6 million, or 0.5% of total loans, as of September 30, 2023, as compared to $13.6 million, or 0.6% of total loans, as of June 2023. The allowance for credit losses was 1.1% of total loans at September 30, 2023, as compared to 1.3% at June 2023.
MVB Financial Corp (MVBF, Financial) 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.
Explore the complete 8-K earnings release (here) from MVB Financial Corp for further details.
