×

Cordia Bancorp Inc. Reports Fourth Quarter 2014 Profit

MIDLOTHIAN, Va., March 4, 2015 (GLOBE NEWSWIRE) -- Cordia Bancorp Inc. ("Cordia") (Nasdaq:BVA), parent company of Bank of Virginia, reported net income of $60,000 or $0.01 per share for the fourth quarter of 2014, compared to net income of $5,000 for the fourth quarter of 2013. For the year ended December 31, 2014, the net loss was $(412,000) or $(0.09) per share compared to net income of $696,000 or $0.27 per share for the year ended December 31, 2013.

Highlights for the year 2014

  • $15.4 million capital raise in April 2014 with the issuance of 3,629,871 voting and nonvoting common shares
  • Added five new officers in commercial, residential and student lending
  • Launched CordiaGrad in the fourth quarter, a new online lending platform to refinance student loans
  • Added two new retail bank branches in the third quarter to expand market share in Chesterfield County, the largest and wealthiest county in Greater Richmond
  • 35% growth in total assets
  • 22% growth in loans
  • 26% growth in deposits
  • 31% increase in employees
  • Net interest income increased $1.4 million, or 21%, net of acquisition accounting adjustment
  • Nonperforming assets decreased to 1.21% of total assets

Chief Executive Officer Jack Zoeller stated, "We have positioned Cordia for a significant new round of growth and sustainable profitability in 2015 and beyond. Our company has grown over 35% after raising fresh capital in the spring of 2014. In addition, CordiaGrad, our new online lending platform, began refinancing student loan debt in late 2014. Our commercial and residential lending team in Richmond continued to produce exceptional results with over 22% growth last year."

Balance Sheet Activity

  • Asset Growth. Total assets increased over 35%, to $318.6 million at December 31, 2014, compared to $235.1 million at December 31, 2013. During 2014, loans increased 22%, or $39 million. Of this amount, organic originations accounted for $29.5 million and purchases of guaranteed student loans increased $9.5 million. In addition, investment securities increased $34.9 million.
  • Deposit Growth and Mix. Total deposits increased 26% to $265.6 million at December 31, 2014, compared to $210.8 million at December 31, 2013. Non-interest bearing deposits increased 34% while interest bearing deposits increased 25% during the year ended December 31, 2014. The cost of deposits decreased from 80 to 73 basis points during the year.
  • Asset Quality. Asset quality continued to improve, with non-performing assets decreasing to $3.9 million, or 1.21% of total assets, at December 31, 2014, from $5.5 million, or 2.33% of total assets, at December 31, 2013.
  • Tangible Book Value. Tangible book value per share was $4.16 at December 31, 2014.

Operating Results

Three months ended December 31, 2014 compared to the three months ended December 31, 2013

  • Net income for the quarter ended December 31, 2014 was $60,000 compared to net income of $5,000 for the prior year fourth quarter.
  • Net interest income was $2.13 million for the fourth quarter of 2014, compared to $1.81 million for the fourth quarter of 2013.
  • Net interest income, net of acquisition accounting adjustments, increased $429,000, or 25.5%.
  • Net interest margin was 2.83% and 3.30% for the fourth quarter of 2014 and 2013, respectively. Adjusting for the impact of acquisition accounting, net interest margin was 2.80% compared to 3.04% for the 2013 period.
  • The provision for loan losses was $182,000 in the fourth quarter of 2014 compared to a $92,000 recovery in the prior year quarter.
  • Noninterest expense increased to $2.09 million for the fourth quarter of 2014, compared to $1.98 million for the fourth quarter of 2013. The increase in noninterest expense was primarily due to staff additions and increased student loan servicing expenses.

Year ended December 31, 2014 compared to the year ended December 31, 2013

  • The net loss for the year ended December 31, 2014 was $(412,000) compared to net income of $696,000 for the year ended December 31, 2013.
  • Net interest income was $8.23 million for the 2014 period, compared to $8.06 million for the 2013 period.
  • Net interest income, net of acquisition accounting adjustments, increased $1.38 million, or 21%.
  • Net interest margin for the 2014 period was 3.04% compared to 3.64% for the 2013 period. Adjusting for the impact of acquisition accounting, net interest margin was 2.96% compared to 2.97% for the 2013 period.
  • Noninterest income was $467,000 for the 2014 period, compared to $300,000 for the 2013 period.
  • Noninterest expense increased to $8.80 million for the 2014 period, compared to $7.64 million for the 2013 period. The increase in noninterest expense was primarily due to incentive compensation, staff additions and an increase in student loan servicing volume.

In the fourth quarter of 2014 the Bank launched CordiaGrad, a student loan refinancing program aimed at high-achieving student loan borrowers who have earned their degrees, established their careers, and maintained good to excellent credit. CordiaGrad is dedicated to offering significant rate savings to holders of federal, private, or parent student loans. To date, the average CordiaGrad customer has lowered their interest rate by 2.50% and reduced their total interest costs by more than $23,000 over the lifetime of their loans.

About Cordia Bancorp

Cordia Bancorp Inc. is a public bank holding company founded in 2009 seeking to invest in undervalued community banks and pursue organic and strategic growth in the Mid-Atlantic banking market. Substantially all of the assets of Cordia consist of its investment in Bank of Virginia. Bank of Virginia provides retail banking services to individuals and commercial customers through six full-service banking locations in the greater Richmond market, including Chesterfield and Henrico Counties and Colonial Heights, Virginia. CordiaGrad provides student loan refinancing services through two offices in Midlothian, VA and Washington, DC.

For more information about Cordia Bancorp, Bank of Virginia and CordiaGrad, visit our websites: www.cordiabancorp.com, www.bankofva.com and www.cordiagrad.com.

DISCLAIMER

This news release may include forward-looking statements. These forward-looking statements are based on current expectations that involve risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may differ materially. These risks include: changes in business or other market conditions; the timely development, production and acceptance of new products and services; the challenge of managing asset/liability levels; the management of credit risk and interest rate risk; the difficulty of keeping expense growth at modest levels while increasing revenues; and other risks detailed from time to time in the Company's periodic filings with the Securities Exchange Commission. Pursuant to the Private Securities Litigation Reform Act of 1995, the Company does not undertake to update forward-looking statements contained within this news release.

Cordia Bancorp
Consolidated Balance Sheets (unaudited)
Dec. 31, Sept. 30, June 30, March 31, Dec. 31,
(Dollars in thousands, except per share data) 2014 2014 2014 2014 2013
Assets
Cash and due from banks $ 5,484 $ 5,789 $ 5,332 $ 10,499 $ 5,290
Fed funds sold and Interest-bearing deposits 16,363 6,131 9,843 16,839 8,694
Total cash and cash equivalents 21,847 11,920 15,175 27,338 13,984
Securities available for sale, at fair value 53,483 54,581 45,835 24,464 24,567
Securities held to maturity, at cost 20,716 21,263 21,839 14,500 14,753
Restricted securities 2,092 1,525 1,525 1,529 1,074
Loans held for investment:
Commercial real estate 103,253 92,300 90,909 85,084 82,581
Commercial and industrial 24,153 25,376 24,605 22,118 21,085
Guaranteed student loans 64,870 67,421 70,624 80,966 55,427
Consumer and other 20,683 19,221 18,147 16,914 14,914
Total loans held for investment 212,959 204,318 204,285 205,082 174,007
Less: Allowance for loan losses (1,089) (1,226) (1,407) (1,504) (1,489)
Net loans held for investment 211,870 203,092 202,878 203,578 172,518
Premises and equipment, net 4,432 4,496 4,510 4,430 4,464
Accrued interest receivable 2,040 1,902 1,830 2,177 1,655
Other real estate owned, net of valuation allowance 1,641 1,543 1,543 1,543 1,545
Other assets 479 485 390 697 588
Total assets $ 318,600 $ 300,807 $ 295,525 $ 280,256 $ 235,148
Liabilities and stockholders' equity
Non-interest bearing deposits 30,709 24,490 24,890 21,649 22,845
Savings and interest bearing demand deposits 83,339 78,779 75,660 74,818 60,685
Time deposits 151,555 149,679 144,643 138,561 127,284
Total deposits 265,603 252,948 245,193 235,028 210,814
Accrued expenses and other liabilities 861 877 3,419 12,202 1,047
FHLB borrowings 25,000 20,000 20,000 20,000 10,000
Total liabilities 291,464 273,825 268,612 267,230 221,861
Common stock - voting 50 50 50 28 28
Common stock - nonvoting 14 14 14 -- --
Additional paid-in-capital 32,957 32,896 32,848 18,672 18,648
Retained deficit (5,417) (5,477) (5,559) (5,289) (5,005)
Accumulated other comprehensive loss (468) (501) (440) (385) (384)
Total stockholders' equity 27,136 26,982 26,913 13,026 13,287
Total liabilities and stockholders' equity $ 318,600 $ 300,807 $ 295,525 $ 280,256 $ 235,148
Cordia Bancorp
Consolidated Statements of Income (unaudited)
Three Months Ended Year Ended
Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, Dec. 31,
(Dollars in thousands, except per share data) 2014 2014 2014 2014 2013 2014 2013
Interest Income
Interest and fees on loans $ 2,247 $ 2,275 $ 2,252 $ 2,149 $ 2,089 $ 8,923 $ 9,366
Investment securities 405 346 311 207 161 1,269 426
Interest on federal funds sold and deposits with banks 6 4 9 6 10 25 73
Total interest income 2,658 2,625 2,572 2,362 2,260 10,217 9,865
Interest Expense
Interest on deposits 451 443 441 426 412 1,761 1,644
Interest on FHLB Borrowings 76 57 56 41 40 230 164
Total interest expense 527 500 497 467 452 1,991 1,808
Net interest income 2,131 2,125 2,075 1,895 1,808 8,226 8,057
Provision for (recovery of) loan losses 182 (106) 209 20 (92) 305 19
Net interest income after provision for (recovery of) loan losses 1,949 2,231 1,866 1,875 1,900 7,921 8,038
Non-interest income
Service charges on deposit accounts 34 44 19 26 40 123 132
Net gain (loss) on sale of available for sale securities 116 (3) -- 64 -- 177 --
Other fee income 50 41 43 33 46 167 168
Total non-interest income 200 82 62 123 86 467 300
Non-interest expense
Salaries and employee benefits 1,094 1,244 1,102 1,406 1,066 4,846 4,216
Professional services 104 92 125 106 161 427 501
Occupancy 139 139 136 151 138 565 565
Data processing and communications 184 206 160 148 139 698 548
FDIC assessment and bank fees 96 99 96 94 97 385 388
Bank franchise taxes 23 23 27 29 14 102 73
Student loan servicing fees and other loan expenses 191 144 210 126 76 671 275
Other real estate expenses 18 6 17 5 16 46 48
Gain on sale of other real estate owned -- -- -- -- -- -- (36)
Supplies and equipment 78 82 83 75 75 318 274
Insurance 42 40 44 41 40 167 166
Director's fees 50 46 75 16 32 187 138
Marketing and business development 21 15 9 6 32 51 88
Other operating expenses 49 95 114 79 95 337 398
Total non-interest expense 2,089 2,231 2,198 2,282 1,981 8,800 7,642
Net income (loss) $ 60 $ 82 $ (270) $ (284) $ 5 $ (412) $ 696
Earnings (loss) per share, basic and diluted $ 0.01 $ 0.01 $ (0.09) $ (0.10) $ -- $ (0.09) $ 0.27
Weighted average shares outstanding, basic 6,426,078 6,420,107 3,017,772 2,776,992 2,773,320 4,675,468 2,602,357
Weighted average shares outstanding, diluted 6,504,160 6,504,106 3,017,772 2,776,992 2,788,302 4,705,948 2,615,387
Cordia Bancorp
Consolidated Financial Highlights (unaudited)
As of and for the Three Months Ended Year Ended
Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, Dec. 31,
(Dollars in thousands, except per share data) 2014 2014 2014 2014 2013 2014 2013
Results of Operations
Interest income $ 2,658 $ 2,625 $ 2,572 $ 2,362 $ 2,260 $ 10,217 $ 9,865
Interest expense 527 500 497 467 452 1,991 1,808
Net interest income 2,131 2,125 2,075 1,895 1,808 8,226 8,057
Provision for (recovery of) loan losses 182 (106) 209 20 (92) 305 19
Net interest income after provision for (recovery of) loan losses 1,949 2,231 1,866 1,875 1,900 7,921 8,038
Non-interest income 200 82 62 123 86 467 300
Non-interest expense 2,089 2,231 2,198 2,282 1,981 8,800 7,642
Net income (loss) $ 60 $ 82 $ (270) $ (284) $ 5 $ (412) $ 696
Earnings (loss) per share, basics and diluted $ 0.01 $ 0.01 $ (0.09) $ (0.10) $ -- $ (0.09) $ 0.27
Weighted average shares outstanding, basic 6,426,078 6,420,107 3,017,772 2,776,992 2,773,320 4,675,468 2,602,357
Weighted average shares outstanding, diluted 6,504,160 6,504,106 3,017,772 2,776,992 2,788,302 4,705,948 2,615,387
Performance Ratios
Return on average assets 0.08% 0.11% -0.38% -0.47% 0.01% -0.14% 0.30%
Return on average equity 0.88% 1.22% -4.20% -8.52% 0.15% -1.77% 5.12%
Return on average tangible equity 0.89% 1.16% -4.22% -8.61% 0.15% -1.77% 5.18%
Efficiency ratio 89.62% 101.09% 102.85% 113.08% 104.59% 101.23% 91.44%
Yields and Rates
Yield on loans 4.32% 4.51% 4.39% 4.88% 4.82% 4.50% 5.50%
Yield on securities 2.06% 1.95% 2.27% 2.08% 2.14% 2.08% 1.84%
Yield on interest earning assets 3.56% 3.75% 3.77% 4.16% 4.13% 3.78% 4.45%
Cost of interest bearing deposits 0.77% 0.79% 0.82% 0.88% 0.89% 0.81% 0.87%
Cost of total deposits 0.69% 0.71% 0.74% 0.79% 0.80% 0.73% 0.80%
Cost of borrowings 1.26% 1.14% 1.12% 1.62% 1.60% 1.24% 1.64%
Cost of interest bearing liabilities 0.81% 0.81% 0.84% 0.92% 0.93% 0.84% 0.91%
Interest rate spread 2.75% 2.91% 2.93% 3.25% 3.21% 2.94% 3.54%
Net interest margin 2.83% 3.01% 3.34% 3.30% 3.30% 3.04% 3.64%
Capital
Total equity to total assets 8.52% 8.97% 9.11% 4.65% 5.65% 8.52% 5.65%
Tangible equity to total assets 8.49% 8.94% 9.07% 4.60% 5.59% 8.49% 5.59%
Book value per share 4.17 4.15 4.14 4.67 4.77 4.17 4.77
Tangible book value per share 4.16 4.13 4.12 4.63 4.72 4.16 4.72
Common shares outstanding 6,504,106 6,504,106 6,504,106 2,788,302 2,788,302 6,504,106 2,788,302
Average Balances
Loans $ 207,833 $ 201,953 $ 205,104 $ 176,161 $ 173,536 $ 198,227 $ 170,200
Securities 78,590 70,848 54,904 39,747 30,156 61,156 23,159
Earning assets 298,712 279,876 272,733 226,968 218,707 270,163 221,448
Total assets 315,167 295,834 286,525 241,660 231,435 285,028 233,140
Interest bearing deposits 234,953 223,927 215,856 193,946 184,920 217,301 188,206
Total deposits 262,947 248,087 238,416 215,721 206,981 241,441 204,868
FHLB borrowings 24,185 20,000 20,000 10,111 10,000 18,616 10,000
Interest bearing liabilities 259,138 243,927 235,856 204,057 194,920 235,917 198,206
Total equity 27,198 26,918 25,727 13,332 13,266 23,342 13,591
Tangible equity 27,089 26,800 25,601 13,196 13,124 23,220 13,434
Asset Quality
Net charge-offs 319 75 306 5 (65) 705 640
Net charge-off rate 0.61% 0.15% 0.60% 0.01% -0.15% 0.36% 0.38%
Non-performing loans 2,221 1,323 2,572 3,225 3,934 2,221 3,934
Non-performing assets 3,862 2,866 4,115 4,768 5,479 3,862 5,479
Allowance for loan losses 1,089 1,226 1,407 1,504 1,489 1,089 1,489
Non-performing loans as a % of total loans held for investment 1.04% 0.65% 1.26% 1.57% 2.26% 1.04% 2.26%
Non-performing assets as a % of total assets 1.21% 0.95% 1.39% 1.70% 2.33% 1.21% 2.33%
Allowance for loan losses as a % of total loans held for investment 0.51% 0.60% 0.69% 0.73% 0.86% 0.51% 0.86%
Allowance for loan losses as a % of non-performing loans 49.03% 92.67% 54.70% 46.64% 37.85% 49.03% 37.85%
Cordia Bancorp
GAAP to Non-GAAP Reconciliations (unaudited)
The table below shows the computations of tangible equity and tangible assets and certain related ratios, all of which are considered to be non-GAAP financial measures. The tangible equity to tangible assets ratio has become a focus of some investors and management believes this ratio may assist in analyzing the Corporation's capital position, absent the effects of intangible assets. These non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation, or as substitute for analysis of results reported under GAAP. Because not all companies use identical calculations, the non-GAAP measures presented in the following table may not be comparable to those reported by other companies.
As of and for the Three Months Ended Year Ended
Dec. 31, Sept. 30, June 30, March 31, Dec. 31, December 31,
(Dollars in thousands, except per share data) 2014 2014 2014 2014 2013 2014 2013
Tangible Equity and Tangible Assets (Period End)
Total shareholders' equity (GAAP) $ 27,136 $ 26,982 $ 26,913 $ 13,026 $ 13,287 $ 27,136 $ 13,287
Less: intangible assets 104 112 121 130 139 104 139
Tangible Equity (non-GAAP) $ 27,032 $ 26,870 $ 26,792 $ 12,896 $ 13,148 $ 27,032 $ 13,148
Total assets (GAAP) $ 318,600 $ 300,807 $ 295,525 $ 280,256 $ 235,148 $ 318,600 $ 235,148
Less: intangible assets 104 112 121 130 139 104 139
Tangible assets (non-GAAP) $ 318,496 $ 300,695 $ 295,404 $ 280,126 $ 235,009 $ 318,496 $ 235,009
Total equity to total assets (GAAP) 8.52% 8.97% 9.11% 4.65% 5.65% 8.52% 5.65%
Book value per share (GAAP) $ 4.17 $ 4.15 $ 4.14 $ 4.67 $ 4.77 $ 4.17 $ 4.77
Tangible equity to tangible assets (non-GAAP) 8.49% 8.94% 9.07% 4.60% 5.59% 8.49% 5.59%
Tangible book value per share (non-GAAP) $ 4.16 $ 4.13 $ 4.12 $ 4.63 $ 4.72 $ 4.16 $ 4.72
Tangible Equity and Tangible Assets (Average)
Total shareholders' equity (GAAP) $ 27,198 $ 26,918 $ 25,727 $ 13,332 $ 13,266 $ 23,342 $ 13,591
Less: intangible assets 109 118 126 136 142 122 157
Tangible Equity (non-GAAP) $ 27,089 $ 26,800 $ 25,601 $ 13,196 $ 13,124 $ 23,220 $ 13,434
Total assets (GAAP) 315,167 295,834 286,525 241,660 231,435 285,028 233,140
Less: intangible assets 109 118 126 136 142 122 157
Tangible assets (non-GAAP) $ 315,058 $ 295,716 $ 286,399 $ 241,524 $ 231,293 $ 284,906 $ 232,983
Total equity to total assets (GAAP) 8.63% 9.10% 8.98% 5.52% 5.73% 8.19% 5.83%
Book value per share (GAAP) $ 4.18 $ 4.14 $ 3.95 $ 4.78 $ 4.76 $ 3.59 $ 4.87
Tangible equity to tangible assets (non-GAAP) 8.60% 9.06% 8.94% 5.46% 5.67% 8.15% 5.77%
Tangible book value per share (non-GAAP) $ 4.16 $ 4.12 $ 3.94 $ 4.73 $ 4.71 $ 3.57 $ 4.82

CONTACT: Mark Severson, CFO, Cordia Bancorp Inc. 804-763-1322

Source:Cordia Bancorp