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Cordia Bancorp Inc. Reports First Quarter 2016 Results

MIDLOTHIAN, Va., May 16, 2016 (GLOBE NEWSWIRE) -- Cordia Bancorp Inc. (“Cordia”) (NASDAQ:BVA), parent company of Bank of Virginia, reported net loss of $(2.315) million, or $(0.35) per share, for the first quarter of 2015, compared to net income of $351,000, $0.05 per share, for the first quarter of 2015. Excluding one-time charges of $2.366 million related to the divestiture of CordiaGrad, our online student loan refinancing platform, core net earnings were $51,000, or $0.01 per share. Included in first quarter results were $221,000 of non-interest expenses for CordiaGrad that will not be included in future quarters due to the divestiture.

Highlights

  • Divestiture of CordiaGrad, our online student loan refinancing platform. One-time charges related to the divestiture are $800,000 for stock compensation for the former chief executive officer, loss on sale of the CordiaGrad business of $843,000, and a loan held-for-sale valuation expense of $723,000, for a total of $2.366 million.
  • 16% year-over-year growth in loans, excluding guaranteed student loans
  • 9% year-over-year growth in total deposits
  • Net interest income up 19%, compared to the first quarter of 2015
  • Nonperforming assets decreased to 1.06% of total assets from 1.16% for the first quarter of 2015
  • Tangible book value per share was $3.94 at March 31, 2016, down from $4.20 at December 31, 2015
  • Net interest margin increased to 2.88% from 2.69% for the first quarter of 2015

Chief Executive Officer Ed Barham stated, “Clearly, the biggest impact to our first quarter results related to the company’s strategic decision to exit the student loan refinance business. While we will incur some additional transitional costs related to the divestiture of CordiaGrad over the next quarter, our second half of the year should generate improved earnings momentum as we focus on our core community banking business. Despite the loss incurred from divestiture, Cordia Bancorp remains well capitalized as measured by regulatory standards.”

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.

For more information about Cordia Bancorp and Bank of Virginia, visit our websites: www.cordiabancorp.com and www.bankofva.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)
March 31, Dec. 31, Sept. 30, June 30, March 31,
(Dollars in thousands, except per share data) 2016
2015
2015
2015
2015
Assets
Cash and due from banks $4,911 $6,135 $9,437 $11,771 $9,602
Fed funds sold and interest-bearing deposits 12,805 12,325 15,970 7,593 23,495
Total cash and cash equivalents 17,716 18,460 25,407 19,364 33,097
Securities available for sale, at fair value 44,899 46,220 48,721 58,445 41,411
Securities held to maturity, at cost 37,227 25,500 26,281 27,087 20,132
Restricted securities 2,393 2,355 2,330 2,331 2,405
Loans held for sale 10,646 220 109 96 117
Loans held for investment:
Commercial real estate 110,903 105,902 106,335 111,180 109,734
Commercial and industrial 32,881 34,819 26,751 27,919 24,057
Guaranteed student loans 51,693 53,847 56,072 57,900 61,441
Consumer and other 29,943 51,465 39,607 28,865 24,521
Total loans held for investment 225,420 246,033 228,765 225,864 219,753
Less: Allowance for loan losses (866) (823) (903) (990) (1,102)
Net loans held for investment 224,554 245,210 227,862 224,874 218,651
Premises and equipment, net 5,919 5,980 6,034 6,083 4,402
Accrued interest receivable 2,018 2,085 1,924 2,033 1,986
Other real estate owned, net of valuation allowance 2,017 1,870 1,761 1,769 1,647
Other assets 429 590 7,555 704 696
Total assets $347,818 $348,490 $347,984 $342,786 $324,544
Liabilities and stockholders' equity
Non-interest bearing deposits 26,938 28,969 26,829 30,066 26,489
Savings and interest bearing demand deposits 112,582 107,057 105,540 101,769 84,216
Time deposits 150,503 154,018 156,939 152,800 154,920
Total deposits 290,023 290,044 289,308 284,635 265,625
Accrued expenses and other liabilities 943 707 553 464 1,061
FHLB borrowings 30,000 30,000 30,000 30,000 30,000
Total liabilities 320,966 320,751 319,861 315,099 296,686
Common stock - voting 53 51 50 51 51
Common stock - nonvoting 14 14 14 14 14
Additional paid-in-capital 34,075 33,191 33,044 33,061 33,011
Retained deficit (7,142) (4,827) (4,700) (4,830) (5,066)
Accumulated other comprehensive loss (148) (690) (285) (609) (152)
Total stockholders' equity 26,852 27,739 28,123 27,687 27,858
Total liabilities and stockholders' equity $347,818 $348,490 $347,984 $342,786 $324,544

Cordia Bancorp
Consolidated Statements of Income (unaudited)
Three Months Ended
March 31, Dec. 31, Sept. 30, June 30, March 31,
(Dollars in thousands, except per share data) 2016
2015
2015
2015
2015
Interest Income
Interest and fees on loans $2,628 $2,404 $2,294 $2,327 $2,183
Investment securities 398 412 446 383 363
Interest on federal funds sold and
deposits with banks 9 8 9 5 7
Total interest income 3,035 2,824 2,749 2,715 2,553
Interest Expense
Interest on deposits 546 529 506 470 454
Interest on FHLB Borrowings 95 95 95 93 89
Total interest expense 641 624 601 563 543
Net interest income 2,394 2,200 2,148 2,152 2,010
Provision for (recovery of) loan losses 98 37 (53) 63 (340)
Net interest income after provision for (recovery of) loan losses 2,296 2,163 2,201 2,089 2,350
Non-interest income (loss)
Service charges on deposit accounts 31 39 35 30 30
Net gain (loss) on sale of available for sale securities - (3) 22 - 114
Realized and unrealized gains (losses) on loans held for sale (713) 11 6 9 21
Other fee income 68 62 52 58 48
Total non-interest income (loss) (614) 109 115 97 213
Non-interest expense
Salaries and employee benefits 1,904 1,006 1,085 1,082 1,280
Professional services 170 147 108 100 84
Occupancy 144 139 149 159 153
Reversal of occupancy fair value discount - - - (225) -
Data processing and communications 246 257 233 206 198
FDIC assessment and bank fees 169 195 88 92 90
Bank franchise taxes 48 49 49 49 49
Student loan servicing fees and other loan expenses 167 227 174 208 146
Other real estate expenses 39 13 26 45 6
Supplies and equipment 73 72 71 70 73
Insurance 18 19 20 19 20
Director's fees 53 104 28 21 26
Marketing and business development 35 118 64 31 18
Loss on sale of subsidiary 843 - - - -
Other operating expenses 88 53 91 93 69
Total non-interest expense 3,997 2,399 2,186 1,950 2,212
Net income (loss) $(2,315) $(127) $130 $236 $351
Earnings (loss) per share, basic and diluted $(0.35) $(0.02) $0.02 $0.04 $0.05
Weighted average shares outstanding, basic 6,658,976 6,572,933 6,572,239 6,583,848 6,559,217
Weighted average shares outstanding, diluted 6,658,976 6,572,933 6,572,239 6,583,848 6,559,217

Cordia Bancorp
Consolidated Financial Highlights (unaudited)
As of and for the Three Months Ended
March 31, Dec. 31, Sept. 30, June 30, March 31,
(Dollars in thousands, except per share data) 2016 2015 2015 2015 2015
Results of Operations
Interest income $3,035 $2,824 $2,749 $2,715 $2,553
Interest expense 641 624 601 563 543
Net interest income 2,394 2,200 2,148 2,152 2,010
Provision for (recovery of) loan losses 98 37 (53) 63 (340)
Net interest income after provision for (recovery of) loan losses 2,296 2,163 2,201 2,089 2,350
Non-interest income (loss) (614) 109 115 97 213
Non-interest expense 3,997 2,399 2,186 1,950 2,212
Net income (loss) $(2,315) $(127) $130 $236 $351
Earnings (loss) per share, basic and diluted $(0.35) $(0.02) $0.02 $0.04 $0.05
Weighted average shares outstanding, basic 6,658,976 6,572,933 6,572,239 6,583,848 6,559,217
Weighted average shares outstanding, diluted 6,658,976 6,572,933 6,572,239 6,583,848 6,559,217
Performance Ratios
Return on average assets -2.65% -0.14% 0.15% 0.29% 0.44%
Return on average equity -33.54% -1.79% 1.85% 3.40% 5.20%
Return on average tangible equity -33.61% -1.80% 1.85% 3.41% 5.22%
Efficiency ratio 224.55% 103.90% 96.60% 86.71% 99.51%
Yields and Rates
Yield on loans 4.18% 4.03% 4.09% 4.18% 4.16%
Yield on securities 2.18% 2.15% 2.06% 2.12% 2.07%
Yield on interest earning assets 3.65% 3.39% 3.34% 3.51% 3.42%
Cost of interest bearing deposits 0.83% 0.80% 0.77% 0.79% 0.78%
Cost of total deposits 0.75% 0.72% 0.70% 0.71% 0.70%
Cost of borrowings 1.23% 1.26% 1.26% 1.19% 1.25%
Cost of interest bearing liabilities 0.87% 0.84% 0.82% 0.83% 0.83%
Interest rate spread 2.78% 2.55% 2.52% 2.67% 2.59%
Net interest margin 2.88% 2.64% 2.61% 2.78% 2.69%
Capital
Total equity to total assets 7.72% 7.96% 8.08% 8.08% 8.58%
Tangible equity to total assets 7.70% 7.94% 8.06% 8.05% 8.56%
Book value per share 3.95 4.21 4.29 4.21 4.23
Tangible book value per share 3.94 4.20 4.27 4.19 4.22
Common shares outstanding 6,795,000 6,586,786 6,562,906 6,582,806 6,584,106
Average Balances
Loans $252,849 $236,822 $222,371 $223,286 $212,566
Securities 73,562 75,979 86,089 72,391 71,198
Earning assets 334,158 330,603 326,904 310,680 302,481
Total assets 351,450 350,910 346,917 327,439 321,455
Interest bearing deposits 264,891 263,393 261,609 239,871 236,415
Total deposits 291,847 292,067 288,455 267,356 264,434
FHLB borrowings 31,129 30,000 30,000 31,346 28,778
Interest bearing liabilities 296,020 293,393 291,609 271,217 265,193
Total equity 27,763 28,106 27,938 27,835 27,353
Tangible equity 27,700 28,034 27,857 27,745 27,254
Asset Quality
Net charge-offs/(recoveries) 55 171 34 175 (353)
Net charge-off rate 0.09% 0.29% 0.06% 0.31% -0.67%
Non-performing loans 1,683 1,834 1,975 1,918 2,108
Non-performing assets 3,700 3,704 3,736 3,687 3,755
Allowance for loan losses 866 823 903 990 1,102
Non-performing loans as a % of total loans held for investment 0.75% 0.75% 0.86% 0.85% 0.96%
Non-performing assets as a % of total assets 1.06% 1.06% 1.07% 1.08% 1.16%
Allowance for loan losses as a % of total loans held for investment 0.38% 0.33% 0.39% 0.44% 0.50%
Allowance for loan losses as a % of non-performing loans 51.46% 44.87% 45.72% 51.62% 52.28%

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
March 31, Dec. 31, Sept. 30, June 30, March 31,
(Dollars in thousands, except per share data) 2016
2015
2015
2015
2015
Tangible Equity and Tangible Assets (Period End)
Total shareholders' equity (GAAP) $26,852 $27,739 $28,123 $27,687 $27,858
Less: intangible assets 59 68 77 86 95
Tangible Equity (non-GAAP) $26,793 $27,671 $28,046 $27,601 $27,763
Total assets (GAAP) $347,818 $348,490 $347,984 $342,786 $324,544
Less: intangible assets 59 68 77 86 95
Tangible assets (non-GAAP) $347,759 $348,422 $347,907 $342,700 $324,449
Total equity to total assets (GAAP) 7.72% 7.96% 8.08% 8.08% 8.58%
Book value per share (GAAP) $3.95 $4.21 $4.29 $4.21 $4.23
Tangible equity to tangible assets (non-GAAP) 7.70% 7.94% 8.06% 8.05% 8.56%
Tangible book value per share (non-GAAP) $3.94 $4.20 $4.27 $4.19 $4.22
Tangible Equity and Tangible Assets (Average)
Total shareholders' equity (GAAP) $27,763 $28,106 $27,938 $27,835 $27,353
Less: intangible assets 63 72 81 90 99
Tangible Equity (non-GAAP) $27,700 $28,034 $27,857 $27,745 $27,254
Total assets (GAAP) 351,450 350,910 346,917 327,439 321,455
Less: intangible assets 63 72 81 90 99
Tangible assets (non-GAAP) $351,387 $350,838 $346,836 $327,349 $321,356
Total equity to total assets (GAAP) 7.90% 8.01% 8.05% 8.50% 8.51%
Book value per share (GAAP) $4.09 $4.27 $4.26 $4.23 $4.15
Tangible equity to tangible assets (non-GAAP) 7.88% 7.99% 8.03% 8.48% 8.48%
Tangible book value per share (non-GAAP) $4.08 $4.26 $4.24 $4.21 $4.14

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

Source:Cordia Bancorp