City Holding Company Announces Approval of Stock Repurchase Plan

Rhea-AI Summary

City Holding Company (NASDAQ:CHCO) has authorized a new share buyback program, allowing the repurchase of up to 1,000,000 common shares, equivalent to about 6% of outstanding shares. This decision reflects management's strategy to enhance shareholder value while maintaining robust capital levels. The previous buyback plan from February 2019 has been rescinded, with 908,701 shares repurchased by March 31, 2021. As of that date, the company remains well-capitalized, supported by strong earnings.

Positive

• Authorization to buy back 1,000,000 shares, enhancing shareholder value.
• No time limit on the buyback program allows flexibility based on market conditions.
• Company remains well-capitalized and profitable, indicating strong financial health.

Negative

• None.

City Holding Company, “the Company” (NASDAQ:CHCO), a $5.8 billion bank holding company headquartered in Charleston, today announced that the board authorized the Company to buy back up to 1,000,000 of its common shares (approximately 6% of outstanding shares) in open market transactions at prices that are accretive to the earnings per share of continuing shareholders. Management may commence or suspend purchases at any time or from time-to-time based on market and business conditions and without prior notice. No time limit has been placed on the duration of the share repurchase program. As part of its authorization, the Company rescinded the previous share repurchase plan approved February 27, 2019. Through March 31, 2021, the Company repurchased 908,701 shares under the February 2019 plan.

"As of March 31, 2021, the Company was very well capitalized and capital continues to grow due to our exceptional earnings. As a result, we view this repurchase plan as part of an ongoing strategy to build value for our stockholders while maintaining appropriate capital levels,” stated Charles R. Hageboeck, President & CEO. The Company currently has 15.6 million outstanding common shares. Repurchase of the Company's stock is subject to availability of the stock and may be discontinued at any time.

City Holding Company is the parent company of City National Bank of West Virginia. City National operates 94 branches across West Virginia, Kentucky, Virginia and Ohio.

Forward-Looking Information

This news release contains certain forward-looking statements that are included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements express only management’s beliefs regarding future results or events and are subject to inherent uncertainty, risks, and changes in circumstances, many of which are outside of management’s control. Uncertainty, risks, changes in circumstances and other factors could cause the Company’s actual results to differ materially from those projected in the forward-looking statements. Factors that could cause actual results to differ from those discussed in such forward-looking statements include, but are not limited to those set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 under “ITEM 1A Risk Factors” and the following: (1) general economic conditions, especially in the communities and markets in which we conduct our business; (2) the uncertainties on the Company’s business, results of operations and financial condition, caused by the COVID-19 pandemic, which will depend on several factors, including the scope and duration of the pandemic, its continued influence on financial markets, the effectiveness of the Company’s work from home arrangements and staffing levels in operational facilities, the impact of market participants on which the Company relies and actions taken by governmental authorities and other third parties in response to the pandemic; (3) credit risk, including risk that negative credit quality trends may lead to a deterioration of asset quality, risk that our allowance for loan losses may not be sufficient to absorb actual losses in our loan portfolio, and risk from concentrations in our loan portfolio; (4) changes in the real estate market, including the value of collateral securing portions of our loan portfolio; (5) changes in the interest rate environment; (6) operational risk, including cybersecurity risk and risk of fraud, data processing system failures, and network breaches; (7) changes in technology and increased competition, including competition from non-bank financial institutions; (8) changes in consumer preferences, spending and borrowing habits, demand for our products and services, and customers’ performance and creditworthiness; (9) difficulty growing loan and deposit balances; (10) our ability to effectively execute our business plan, including with respect to future acquisitions; (11) changes in regulations, laws, taxes, government policies, monetary policies and accounting policies affecting bank holding companies and their subsidiaries; (12) deterioration in the financial condition of the U.S. banking system may impact the valuations of investments the Company has made in the securities of other financial institutions; (13) regulatory enforcement actions and adverse legal actions; (14) difficulty attracting and retaining key employees; (15) other economic, competitive, technological, operational, governmental, regulatory, and market factors affecting our operations. Forward-looking statements made herein reflect management's expectations as of the date such statements are made. Such information is provided to assist stockholders and potential investors in understanding current and anticipated financial operations of the Company and is included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances that arise after the date such statements are made. Further, the Company is required to evaluate subsequent events through the filing of its December 31, 2020 Form 10-K. The Company will continue to evaluate the impact of any subsequent events on the preliminary December 31, 2020 results and will adjust the amounts if necessary.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210401005514/en/

FAQ

What is the purpose of City Holding Company's share buyback program?

The buyback program aims to enhance shareholder value by repurchasing common shares, effectively increasing earnings per share for remaining shareholders.

When was the new share buyback program authorized for CHCO?

The new share buyback program was authorized on March 31, 2021.

How many shares can City Holding Company buy back under the new program?

City Holding Company can buy back up to 1,000,000 shares, which is approximately 6% of its outstanding shares.

What was the status of the previous buyback program for CHCO?

The previous buyback program, approved on February 27, 2019, has been rescinded after repurchasing 908,701 shares by March 31, 2021.

How does the buyback program impact City Holding Company's stock price?

The buyback program is expected to support the stock price by reducing the number of shares outstanding, which can increase earnings per share.