MVB Financial Corporation Announces Fourth Quarter Results and Record Earnings for Year-End 2021

Rhea-AI Summary

MVB Financial Corp. (MVBF) reported a net income of $10 million for Q4 2021, translating to $0.83 basic and $0.77 diluted earnings per share. Key metrics include a 6% increase in total loans to $1.87 billion and a 29% year-over-year growth. Noninterest-bearing deposits rose to $1.12 billion, comprising 47% of total deposits. The dividend increased by 7% to $0.15 per share. MVB's Fintech investments yielded $2.8 million, contributing to a tangible book value of $22.17 per share. Despite a 34% drop in noninterest income from the prior quarter, the bank maintains a strong liquidity position.

Positive

• Record earnings with net income of $10 million for Q4 2021.
• 6% increase in total loans to $1.87 billion from Q3 2021.
• 47% of total deposits now noninterest-bearing, up from 42% in Q3 2021.
• Tangible book value per share increased to $22.17, up 12% year-over-year.
• Dividend raised to $0.15 per share, a 7% increase.

Negative

• 34% decrease in noninterest income compared to Q3 2021.

FAIRMONT, W.Va.--(BUSINESS WIRE)-- 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 fourth quarter and year ended December 31, 2021, with reported net income of $10.0 million, or $0.83 basic and $0.77 diluted earnings per share for the three months ended December 31, 2021.

		Quarterly									Year-to-Date
		2021			2021			2020			2021			2020
		Fourth Quarter			Third Quarter			Fourth Quarter
Net income		$	9,959		$	11,828		$	11,838		$	39,121		$	37,411
Earnings per share - basic		$	0.83		$	1.00		$	1.00		$	3.32		$	3.13
Earnings per share - diluted		$	0.77		$	0.92		$	0.97		$	3.10		$	3.06

Earnings for the fourth quarter were impacted by the release of allowance for loan losses of $5.7 million. The after-tax impact of the release on basic and diluted earnings per share was $0.38 and $0.35, respectively, for the three months ended December 31, 2021.

“MVB’s fourth quarter and record earnings for 2021 reflect the diversity of our tech-forward business model, as well as our strong positioning for the future,” said Larry F. Mazza, Chief Executive Officer, MVB Financial. “The transformation of our ‘best-in-class’ funding profile continues, as noninterest-bearing deposits now represent 47% of MVB Bank’s total deposit funding, up from 8% when we pivoted our company seven years ago. At the same time, our loan growth initiatives have come to fruition against the backdrop of a strengthening economy and rising interest rates, leaving our highly-liquid balance sheet very well-positioned, highlighted on one side by strong low-cost funding, and on the other by an increasingly diverse loan growth engine.”

Mazza added, “Other recent highlights include substantial gains recognized from our Fintech investment portfolio, a core component of our business in which we not only provide banking services to Fintechs, but also build and invest in them as well. 2021 marked the successful completion of our MVB 3.0 three-year strategic plan, in which we exceeded our performance goals. We now look to implement our new three-year plan, called ‘MVB F1,’ the details of which we look forward to discussing at our Investor Conference in Las Vegas on March 14 and 15, 2022.”

FOURTH QUARTER 2021 HIGHLIGHTS

• Fintech and Gaming verticals power continued favorable remix of funding base
  • Noninterest-bearing (“NIB”) deposits were $1.12 billion as of December 31, 2021, up $121.1 million, or 12%, and $404.6 million, or 57%, from September 30, 2021 and December 31, 2020, respectively. NIB deposits as a percentage of total deposits were 47% as of December 31, 2021, as compared to 42% and 36% as of September 30, 2021 and December 31, 2020, respectively.
  • Financial technology (“Fintech”) deposits totaled $1.14 billion as of December 31, 2021, up $166.4 million, or 17%, and $609.1 million, or 114%, from September 30, 2021 and December 31, 2020, respectively.
  • Gaming deposits, which are included in total Fintech deposits, totaled $911.6 million as of December 31, 2021, up $137.5 million, or 18%, and $553.7 million, or 155%, from September 30, 2021 and December 31, 2020, respectively.
• Robust loan growth driven by an increasingly diverse customer base
  • Total loans of $1.87 billion increased by $105.7 million, or 6%, compared to September 30, 2021 and $416.1 million, or 29%, from December 31, 2020. Loans, excluding Paycheck Protection Program (“PPP”) loans of $131.7 million, totaled $1.74 billion as of December 31, 2021, an increase of $121.3 million, or 8%, from September 30, 2021, and an increase of $366.4 million, or 27% from December 31, 2020.
  • Loan growth during the quarter was driven primarily by our health care lending group and strategic lending partnerships.
  • The loan-to-deposit ratio was 78.6% as of December 31, 2021, as compared to 73.5% at September 30, 2021, and 73.3% as of December 31, 2020.
• Strategic Fintech investments yield recent gains
  • For the quarter ended December 31, 2021, MVB recorded income of $2.8 million related to a strategic investment within its Fintech investment portfolio.
  • Since 2016, MVB’s Fintech investment portfolio has generated an internal rate of return of 184%.
• Continued value creation at a peer-leading pace
  • Tangible book value (“TBV”) per share, a non-U.S. GAAP measure, was $22.17 as of December 31, 2021, an increase of 2% and 12% from September 30, 2021 and December 31, 2020, respectively. A reconciliation of TBV to its most comparable U.S. GAAP measure is included below.
  • Since 2016, MVB has increased TBV per share at a compound annual growth rate of just under 16%, which compares favorably to the regional peer average of 10%.
  • Reflecting MVB’s strong capital position and earnings profile as of December 31, 2021, the Company elected to increase the quarterly cash dividend to $0.15 per share for the fourth quarter of 2021, up $0.01 (or 7%) from the third quarter of 2021.

INCOME STATEMENT

On a fully tax-equivalent basis, net interest margin for the quarter ended December 31, 2021 was 3.28%, an increase of three basis points versus the quarter ended September 30, 2021 and a decrease of 16 basis points versus the quarter ended December 31, 2020. Please 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. The tax-equivalent adjustments impacting net interest income were $0.3 million for the quarter ended December 31, 2021, $0.3 million for the quarter ended September 30, 2021 and $0.4 million for the quarter ended December 31, 2020.

Interest income increased $2.6 million, or 13%, compared to the quarter ended September 30, 2021 and increased $3.7 million, or 19%, compared to the quarter ended December 31, 2020. The tax-equivalent yield on commercial loans increased 45 basis points compared to the quarter ended September 30, 2021. The decreases of 158 and 95 basis points in the yield on real estate loans and investments, respectively, drove the 24 basis point decrease in the tax-equivalent yield on earning assets compared to the quarter ended December 31, 2020.

Interest expense increased $0.2 million, or 11%, compared to the quarter ended September 30, 2021 and decreased $0.1 million, or 7%, compared to the quarter ended December 31, 2020. The increase compared to the quarter ended September 30, 2021 was the result of an increase of $0.3 million in interest on subordinated debt. Despite an increase in average deposits of $227.5 million during the quarter, interest on deposits decreased $0.1 million during the quarter, as NIB deposits grew as a percentage of total deposits and cost of interest-bearing deposits decreased.

MVB Bank's average NIB deposits increased by $239.6 million from the quarter ended September 30, 2021, maintaining a 19 basis point favorable spread on the tax-equivalent net interest margin for the quarter ended December 31, 2021, compared to a 16 basis point favorable spread for the quarter ended September 30, 2021. An increase in MVB Bank’s average NIB deposits of $406.0 million from the quarter ended December 31, 2020 helped to maintain a 19 basis point favorable spread on the tax-equivalent net interest margin for the quarter ended December 31, 2021, compared to a 18 basis point favorable spread for the same period in 2020.

Noninterest income totaled $14.5 million for the quarter ended December 31, 2021, a decrease of $7.4 million, or 34%, from the quarter ended September 30, 2021 and a decrease of $2.0 million, or 12%, from the quarter ended December 31, 2020.

The $7.4 million decrease in noninterest income from the quarter ended September 30, 2021 was due primarily to the gain on sale of branches of $10.8 million in the quarter ended September 30, 2021.

The $2.0 million decrease in noninterest income from the quarter ended December 31, 2020 was primarily due to decreases in equity method investment income of $7.7 million and gain on sale of equity securities of $3.5 million, offset by increases in holding gain on equity securities of $1.8 million, compliance consulting income of $2.1 million, payment card and service charge income of $1.3 million, gain on sale of portfolio loans of $1.1 million and other operating income of $2.4 million.

Noninterest expense totaled $29.1 million for the quarter ended December 31, 2021, an increase of $3.3 million, or 13%, from the quarter ended September 30, 2021 and an increase of $8.2 million, or 39%, from the quarter ended December 31, 2020.

The $3.3 million increase in noninterest expense from the quarter ended September 30, 2021 was due to an increase in salaries and employee benefits of $1.6 million, primarily driven by incentive compensation and new hires to further build-out the Fintech vertical at Victor Technologies, Inc. (“Victor”),as well as an increase in professional fees of $1.2 million. Victor makes it faster and more efficient for entities to launch a Fintech program. Its technology simplifies integration for Fintech companies and offers risk tools to banks to help them conduct due diligence, risk assessments, onboarding and oversight of their Fintech clients.

The $8.2 million increase in noninterest expense from the quarter ended December 31, 2020 was primarily due to increases in salaries and employee benefits of $5.8 million and professional fees of $1.4 million.

The efficiency ratio was 80.7% for the quarter ended December 31, 2021, compared to 62.9% and 61.0%% for the quarters ended September 30, 2021 and December 31, 2020, respectively, as a result of our ongoing expansion of our risk management and operations teams in support of Fintech initiatives .

BALANCE SHEET

Loan balances grew $105.7 million as compared to September 30, 2021 and $416.1 million as compared to December 31, 2020. Included in loans are PPP loans totaling $131.7 million at December 31, 2021, a decrease of $15.6 million, or 11%, from September 30, 2021, and an increase of $49.7 million, or 61%, from December 31, 2020.

The tax-equivalent yield on loans, including PPP loans, was 4.64% for the quarter ended December 31, 2021, an increase of 39 basis points from the quarter ended September 30, 2021 and a decrease of seven basis points from the quarter ended December 31, 2020.

Deposits totaled $2.38 billion as of December 31, 2021, a decrease of $21.3 million, or 1%, from September 30, 2021 and an increase of $395.2 million, or 20%, from December 31, 2020. With NIB deposits as a percentage of total deposits at 47% as of December 31, 2021, the Company’s strategy to evolve MVB Bank’s deposit mix by replacing high-cost deposits with NIB deposits has proved to be successful and viable long-term.

CAPITAL

There was no significant change in regulatory ratios quarter over quarter. The Community Bank Leverage Ratio was 11.6% and 12.0% as of December 31, 2021 and September 30, 2021, respectively. MVB Bank’s Tier 1 Risk-Based Capital Ratio was 15.8% and 15.7% as of December 31, 2021 and September 30, 2021, respectively. The Bank’s Total Risk-Based Capital Ratio was 16.7% and 16.9% as of December 31, 2021 and September 30, 2021, respectively.

ASSET QUALITY

Changes to the outstanding balances of the loan portfolios, the level of recognized charge-offs and the resulting historical loss rates and adjustments to the risk grading of loans within the portfolio are all contributing factors in the provision for loan losses. Nonperforming loans totaled $17.7 million, or 0.9% of total loans, as of December 31, 2021, compared to 1.0% of total loans as of September 30, 2021 and 0.9% of total loans as of December 31, 2020. Criticized loans as a percentage of total loans were 5.4%, a decrease of 118 basis points, or 18%, from September 30, 2021, and a decrease of 413 basis points, or 2%, from December 31, 2020.

The release of allowance for loan losses totaled $5.7 million for the quarter ended December 31, 2021, compared to a provision for loan losses of $0.4 million for the quarter ended September 30, 2021 and a provision for loan losses of $0.2 million for the quarter ended December 31, 2020. The $5.7 million release was driven by a $2.6 million release allocated to a single loan, as well as improvements in allocation rates, portfolio risk grades and economic and business factors.

Allowance for loan losses to total loans was 1.0% as of December 31, 2021, a decrease of 45 basis points from September 30, 2021 and a decrease of 80 basis points from December 31, 2020. Excluding PPP loans, allowance for loan losses to total loans was 1.1% as of December 31, 2021.

There were $1.3 million net charge-offs for the quarter ended December 31, 2021, compared to $0.1 million in the quarter ended September 30, 2021 and $0.3 million for the quarter ended December 31, 2020.

About MVB Financial Corp.

MVB Financial Corp., the holding company of MVB Bank, Inc., is publicly traded on The Nasdaq Capital Market® (“Nasdaq”) under the ticker “MVBF.”

MVB is a financial holding company headquartered in Fairmont, WV. Through its subsidiary, MVB Bank, and the bank’s subsidiaries, the Company 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 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; inability to achieve anticipated synergies and successfully integrate recent mergers and acquisitions; inability to successfully execute business plans, including strategies related to investments in financial technology companies; competition; length and severity of the COVID-19 pandemic and its impact on the Company’s business and financial condition; 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, 2020, 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.

MVB Financial Corp. Financial Highlights Consolidated Statements of Income (Unaudited) (Dollars in thousands, except per share data)
		Quarterly										Year-to-Date
		2021				2021			2020			2021				2020
		Fourth Quarter				Third Quarter			Fourth Quarter
Interest income		$	23,049			$	20,484		$	19,353		$	83,429			$	80,453
Interest expense			1,546				1,388			1,666			6,270				11,627
Net interest income			21,503				19,096			17,687			77,159				68,826
Provision (release of allowance) for loan losses			(5,733	)			380			214			(6,275	)			16,579
Net interest income after provision (release of allowance) for loan losses			27,236				18,716			17,473			83,434				52,247
Noninterest income			14,542				21,951			16,576			62,596				91,837
Noninterest expense:
Salaries and employee benefits			18,110				16,528			12,269			60,210				61,629
Other expense			10,993				9,301			8,618			37,242				35,512
Total noninterest expenses			29,103				25,829			20,887			97,452				97,141
Income before income taxes			12,675				14,838			13,162			48,578				46,943
Income tax expense			2,876				3,164			1,324			9,882				9,532
Net income before noncontrolling interest			9,799				11,674			11,838			38,696				37,411
Net loss attributable to noncontrolling interest			160				154			—			425				—
Net income attributable to parent			9,959				11,828			11,838			39,121				37,411
Preferred dividends			—				—			116			35				461
Net income available to common shareholders		$	9,959			$	11,828		$	11,722		$	39,086			$	36,950
Earnings per share - basic		$	0.83			$	1.00		$	1.00		$	3.32			$	3.13
Earnings per share - diluted		$	0.77			$	0.92		$	0.97		$	3.10			$	3.06

Condensed Consolidated Balance Sheets (Unaudited) (Dollars in thousands)
		December 31, 2021				September 30, 2021				December 31, 2020
Cash and cash equivalents		$	307,437			$	390,081			$	263,893
Certificates of deposit with banks			2,719				9,582				11,803
Investment securities available-for-sale			421,466				439,023				410,624
Equity securities			32,402				29,809				27,585
Loans held-for-sale			—				—				1,062
Loans receivable			1,869,838				1,764,186				1,453,744
Allowance for loan losses			(18,266	)			(25,187	)			(25,844	)
Loans receivable, net			1,851,572				1,738,999				1,427,900
Premises and equipment, net			25,052				25,043				26,203
Goodwill			3,988				3,988				2,350
Other assets			143,708				152,299				160,056
Total assets		$	2,788,344			$	2,788,824			$	2,331,476
Noninterest-bearing deposits		$	1,120,433			$	999,328			$	715,791
Interest-bearing deposits			1,257,172				1,399,612				1,266,598
Subordinated debt			73,030				72,966				43,407
Other liabilities			62,406				50,218				66,197
Stockholders' equity, including noncontrolling interest			275,303				266,700				239,483
Total liabilities and stockholders' equity		$	2,788,344			$	2,788,824			$	2,331,476

Reportable Segments (Unaudited)
Twelve Months Ended December 31, 2021		CoRe Banking			Mortgage Banking			Financial Holding Company			Other			Intercompany Eliminations			Consolidated
(Dollars in thousands)
Interest income		$	83,023		$	411		$	15		$	(8	)	$	(12	)	$	83,429
Interest expense			4,078			—			2,188			16			(12	)		6,270
Net interest income			78,945			411			(2,173	)		(24	)		—			77,159
Release of allowance for loan losses			(6,274	)		(1	)		—			—			—			(6,275	)
Net interest income after release of allowance for loan losses			85,219			412			(2,173	)		(24	)		—			83,434
Total noninterest income			33,179			16,342			11,103			15,002			(13,030	)		62,596
Noninterest Expenses:
Salaries and employee benefits			33,595			—			13,704			12,911			—			60,210
Other expense			37,033			16			6,573			6,650			(13,030	)		37,242
Total noninterest expenses			70,628			16			20,277			19,561			(13,030	)		97,452
Income (loss) before income taxes			47,770			16,738			(11,347	)		(4,583	)		—			48,578
Income tax expense (benefit)			9,154			4,068			(2,091	)		(1,249	)		—			9,882
Net income (loss) before noncontrolling interest			38,616			12,670			(9,256	)		(3,334	)		—			38,696
Net loss attributable to noncontrolling interest			—			—			—			(425	)		—			(425	)
Net income (loss) attributable to parent			38,616			12,670			(9,256	)		(2,909	)		—			39,121
Preferred stock dividends			—			—			35			—			—			35
Net income (loss) available to common shareholders		$	38,616		$	12,670		$	(9,291	)	$	(2,909	)	$	—		$	39,086

Twelve Months Ended December 31, 2020		CoRe Banking		Mortgage Banking			Financial Holding Company			Other		Intercompany Eliminations			Consolidated
(Dollars in thousands)
Interest income		$	75,812	$	6,269		$	3		$	—	$	(1,631	)	$	80,453
Interest expense			10,400		3,139			261			—		(2,173	)		11,627
Net interest income			65,412		3,130			(258	)		—		542			68,826
Provision (release of allowance) for loan losses			16,649		(70	)		—					—			16,579
Net interest income after provision (release of allowance) for loan losses			48,763		3,200			(258	)		—		542			52,247
Total noninterest income			24,420		63,490			6,685			5,909		(8,667	)		91,837
Noninterest Expenses:
Salaries and employee benefits			25,808		21,550			11,278			2,993		—			61,629
Other expense			31,389		5,074			5,265			1,909		(8,125	)		35,512
Total noninterest expenses			57,197		26,624			16,543			4,902		(8,125	)		97,141
Income (loss) before income taxes			15,986		40,066			(10,116	)		1,007		—			46,943
Income tax expense (benefit)			1,479		9,862			(2,082	)		273		—			9,532
Net income (loss)			14,507		30,204			(8,034	)		734		—			37,411
Preferred stock dividends			—		—			461			—		—			461
Net income (loss) available to common shareholders		$	14,507	$	30,204		$	(8,495	)	$	734	$	—		$	36,950

Average Balances and Interest Rates (Unaudited) (Dollars in thousands)
		Three Months Ended											Three Months Ended											Three Months Ended
		December 31, 2021											September 30, 2021											December 31, 2020
		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		$	376,667			$	141			0.15	%		$	184,131			$	60			0.13	%		$	266,999			$	82			0.12	%
CDs with banks			6,998				33			1.87				11,065				52			1.86				11,938				58			1.93
Investment securities:
Taxable			258,534				573			0.88				238,807				575			0.96				167,968				894			2.12
Tax-exempt 2			183,736				1,447			3.12				202,380				1,528			3.00				200,666				1,659			3.29
Loans and loans held-for-sale: 1
Commercial 3			1,451,347				17,653			4.83				1,416,236				15,646			4.38				1,136,899				13,763			4.82
Tax-exempt 2			5,811				65			4.41				6,678				77			4.57				7,501				92			4.87
Real estate			320,078				2,153			2.67				297,450				2,282			3.04				287,547				3,073			4.25
Consumer			32,903				1,306			15.75				16,133				602			14.80				6,053				99			6.51
Total loans			1,810,139				21,177			4.64				1,736,497				18,607			4.25				1,438,000				17,027			4.71
Total earning assets			2,636,074				23,370			3.52				2,372,880				20,822			3.48				2,085,571				19,720			3.76
Less: Allowance for loan losses			(24,977	)										(24,978	)										(26,568	)
Cash and due from banks			6,751											5,922											22,642
Other assets			203,957											200,536											215,716
Total assets		$	2,821,805										$	2,554,360										$	2,297,361
Liabilities
Deposits:
NOW		$	711,805			$	289			0.16	%		$	743,632			$	333			0.18	%		$	475,707			$	446			0.37	%
Money market checking			489,818				221			0.18				433,216				211			0.19				492,519				282			0.23
Savings			36,455				1			0.01				42,126				—			—				50,821				(2	)		(0.02	)
IRAs			6,439				18			1.11				7,302				21			1.14				13,410				49			1.45
CDs			91,059				263			1.15				121,482				333			1.09				235,412				679			1.15
Repurchase agreements and federal funds sold			11,249				3			0.11				10,941				3			0.11				10,070				4			0.16
FHLB and other borrowings			79				—			—				494				6			4.82				19,589				25			0.51
Subordinated debt			72,995				751			4.08				44,460				481			4.29				17,835				183			4.08
Total interest-bearing liabilities			1,419,899				1,546			0.43				1,403,653				1,388			0.39				1,315,363				1,666			0.50
Noninterest-bearing demand deposits			1,092,520											852,872											686,537
Other liabilities			42,318											36,097											59,841
Total liabilities			2,554,737											2,292,622											2,061,741
Stockholders’ equity
Preferred stock			597											—											7,334
Common stock			12,878											12,704											12,095
Paid-in capital			142,479											141,246											124,970
Treasury stock			(16,741	)										(16,741	)										(5,922	)
Retained earnings			129,896											122,361											98,046
Accumulated other comprehensive income (loss)			(3,188	)										1,207											(903	)
Total stockholders’ equity attributable to parent			265,921											260,777											235,620
Noncontrolling interest			1,147											961											—
Total stockholders’ equity			267,068											261,738											235,620
Total liabilities and stockholders’ equity		$	2,821,805										$	2,554,360										$	2,297,361
Net interest spread (tax-equivalent)										3.09											3.09											3.26
Net interest income and margin (tax-equivalent) 2						$	21,824			3.28	%						$	19,434			3.25	%						$	18,054			3.44	%
Less: Tax-equivalent adjustments						$	(320	)									$	(338	)									$	(367	)
Net interest spread										3.04											3.03											3.19
Net interest income and margin						$	21,503			3.24	%						$	19,096			3.19	%						$	17,687			3.37	%
1 Non-accrual loans are included in total loan balances, lowering the effective yield for the portfolio in the aggregate. 2 In 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 following this table. 3 MVB Bank’s PPP loans totaling $131.7 million, $147.3 million and $82.0 million are included in this amount for the three months ended December 31, 2021, September 30, 2021 and December 31, 2020, respectively.

		Twelve Months Ended											Twelve Months Ended
		December 31, 2021											December 31, 2020
		Average Balance				Interest Income/ Expense				Yield/ Cost			Average Balance				Interest Income/ Expense				Yield/ Cost
Assets
Interest-bearing balances with banks		$	249,801			$	305			0.12	%		$	125,259			$	191			0.15	%
CDs with banks			10,406				201			1.93				12,484				246			1.97
Investment securities:
Taxable			231,450				2,405			1.04				121,607				2,448			2.01
Tax-exempt 2			201,532				6,328			3.14				144,389				5,361			3.71
Loans and loans held-for-sale: 1
Commercial 3			1,387,273				63,551			4.58				1,136,858				54,434			4.79
Tax-exempt 2			6,646				300			4.51				8,966				422			4.70
Real estate			307,829				9,662			3.14				403,166				18,100			4.49
Consumer			15,890				2069			13.02				6,973				465			6.67
Total loans			1,717,638				75,582			4.40				1,555,963				73,421			4.72
Total earning assets			2,410,827				84,821			3.52				1,959,702				81,667			4.17
Less: Allowance for loan losses			(25,682	)										(18,079	)
Cash and due from banks			13,874											26,460
Other assets			201,893											181,439
Total assets		$	2,600,912										$	2,149,522
Liabilities
Deposits:
NOW		$	673,547			$	1,612			0.24	%		$	408,110			$	2,521			0.62	%
Money market checking			469,010				883			0.19				458,606				2,680			0.58
Savings			42,800				5			0.01				45,420				6			0.01
IRAs			9,674				121			1.25				13,691				218			1.59
CDs			134,250				1,355			1.01				349,787				4,869			1.39
Repurchase agreements and federal funds sold			10,821				13			0.12				9,856				23			0.23
FHLB and other borrowings			25,275				93			0.37				68,407				1,049			1.53
Subordinated debt			51,149				2,188			4.28				7,568				261			3.45
Total interest-bearing liabilities			1,416,526				6,270			0.44				1,361,445				11,627			0.85
Noninterest-bearing demand deposits			895,024											502,457
Other liabilities			38,090											61,169
Total liabilities			2,349,640											1,925,071
Stockholders’ equity
Preferred stock			730											7,334
Common stock			12,614											12,047
Paid-in capital			140,610											130,312
Treasury stock			(16,741	)										(2,637	)
Retained earnings			112,842											77,044
Accumulated other comprehensive income (loss)			534											351
Total stockholders’ equity attributable to parent			250,589											224,451
Noncontrolling interest			683											—
Total stockholders’ equity			251,272											224,451
Total liabilities and stockholders’ equity		$	2,600,912										$	2,149,522
Net interest spread (tax-equivalent)										3.08											3.32
Net interest income and margin (tax-equivalent) 2						$	78,551			3.26	%						$	70,040			3.57	%
Less: Tax-equivalent adjustments						$	(1,392	)									$	(1,214	)
Net interest spread										3.02											3.25
Net interest income and margin						$	77,159			3.20	%						$	68,826			3.51	%
1 Non-accrual loans are included in total loan balances, lowering the effective yield for the portfolio in the aggregate. 2 In 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 following this table. 3 MVB Bank’s PPP loans totaling $131.7 million and $82.0 million are included in this amount for the years ended December 31, 2021 and December 31, 2020, respectively.

The following table reconciles, for the periods shown below, net interest margin on a fully tax-equivalent basis:

		Three Months Ended												Twelve Months Ended
(Dollars in thousands)		December 31, 2021				September 30, 2021				December 31, 2020				December 31, 2021				December 31, 2020
Net interest margin - U.S. GAAP basis
Net interest income		$	21,503			$	19,096			$	17,687			$	77,159			$	68,826
Average interest-earning assets			2,636,074				2,372,880				2,085,571				2,410,827				1,959,702
Net interest margin			3.24	%			3.19	%			3.37	%			3.20	%			3.51	%
Net interest margin - non-U.S. GAAP basis
Net interest income		$	21,503			$	19,096			$	17,687			$	77,159			$	68,826
Impact of fully tax-equivalent adjustment			320				338				367				1,392				1,214
Net interest income on a fully tax-equivalent basis			21,824				19,434				18,054				78,551				70,040
Average interest-earning assets			2,636,074				2,372,880				2,085,571				2,410,827				1,959,702
Net interest margin on a fully tax-equivalent basis			3.28	%			3.25	%			3.44	%			3.26	%			3.57	%

Selected Financial Data (Unaudited) (Dollars in thousands, except per share data)
		Quarterly												Year-to-Date
		2021				2021				2020				2021				2020
		Fourth Quarter				Third Quarter				Fourth Quarter
Earnings and Per Share Data:
Net income		$	9,959			$	11,828			$	11,838				39,121				37,411
Net income available to common shareholders		$	9,959			$	11,828			$	11,722				39,086				36,950
Earnings per share - basic		$	0.83			$	1.00			$	1.00			$	3.32			$	3.13
Earnings per share - diluted		$	0.77			$	0.92			$	0.97			$	3.10			$	3.06
Cash dividends paid per common share		$	0.15			$	0.14			$	0.09			$	0.51			$	0.36
Book value per common share		$	22.70			$	22.18			$	20.14			$	22.70			$	20.14
Tangible book value per common share 1		$	22.17			$	21.64			$	19.73			$	22.17			$	19.73
Weighted-average shares outstanding - basic			12,057,451				11,880,348				11,752,841				11,778,557				11,821,574
Weighted-average shares outstanding - diluted			12,944,919				12,824,309				12,144,471				12,613,620				12,088,106
Performance Ratios:
Return on average assets 2			1.4	%			1.9	%			2.1	%			1.5	%			1.7	%
Return on average equity 2			15.0	%			18.1	%			20.1	%			15.6	%			16.7	%
Net interest margin 3 4			3.28	%			3.25	%			3.44	%			3.26	%			3.57	%
Efficiency ratio 5			80.7	%			62.9	%			61.0	%			69.7	%			60.5	%
Overhead ratio 2 6			4.1	%			4.0	%			3.6	%			3.7	%			4.5	%
Equity to assets			9.8	%			9.5	%			10.3	%			9.8	%			10.3	%
Asset Quality Data and Ratios:
Charge-offs		$	1,619			$	98			$	300			$	1,619			$	2,190
Recoveries		$	316			$	23			$	16			$	316			$	33
Net loan charge-offs to total loans 2 7			0.1	%			—	%			0.1	%			0.1	%			0.1	%
Allowance for loan losses		$	18,266			$	25,187			$	25,844			$	18,266			$	25,844
Allowance for loan losses to total loans 8			1.0	%			1.4	%			1.8	%			1.0	%			1.8	%
Nonperforming loans		$	17,713			$	17,453			$	13,713			$	17,713			$	13,713
Nonperforming loans to total loans			0.9	%			1.0	%			0.9	%			0.9	%			0.9	%
Intercoastal Mortgage Company, LLC Production Data9:
Mortgage pipeline		$	1,007,990			$	1,150,116			$	1,536,826			$	1,007,990			$	1,536,826
Loans originated		$	1,046,977			$	1,456,588			$	4,461,922			$	6,269,371			$	4,461,922
Loans closed		$	977,354			$	1,233,605			$	3,468,646			$	5,607,951			$	3,468,646
Loans sold		$	957,153			$	1,098,475			$	2,948,724			$	5,326,029			$	2,948,724
1 common equity less total goodwill and intangibles per common share, a non-U.S. GAAP measure 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 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, an entity in which we have a 40% ownership interest that we account for as an equity method investment

Non-GAAP Reconciliation: Tangible Book Value per Common Share (Unaudited) (Dollars in thousands, except per share data)
		Year-to-Date
		December 31, 2021				September 30, 2021				December 31, 2020
Goodwill		$	3,988			$	3,988			$	2,350
Intangibles			2,316				2,518				2,400
Total intangibles			6,304				6,506				4,750
Total equity attributable to parent			274,328				265,565				239,483
Less: Preferred equity			—				—				(7,334	)
Less: Total intangibles			(6,304	)			(6,506	)			(4,750	)
Tangible common equity			268,024				259,059				227,399
Tangible common equity			268,024				259,059				227,399
Common shares outstanding (000s)			12,087				11,972				11,526
Tangible book value per common share		$	22.17			$	21.64			$	19.73

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20220217005933/en/

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

Source: MVB Financial Corp.

FAQ

What were MVB Financial's Q4 2021 earnings results?

MVB Financial reported a net income of $10 million for Q4 2021, with basic earnings per share of $0.83.

How did MVB Financial's loan growth perform in Q4 2021?

Total loans increased by 6% to $1.87 billion in Q4 2021 compared to Q3 2021.

What was the change in noninterest-bearing deposits for MVB Financial?

Noninterest-bearing deposits rose to $1.12 billion, representing 47% of total deposits as of December 31, 2021.

Did MVB Financial increase its dividend in 2021?

Yes, MVB Financial raised its quarterly dividend to $0.15 per share, a 7% increase.

What impact did MVB's Fintech investments have in 2021?

MVB recorded income of $2.8 million from its Fintech investment portfolio for the quarter ended December 31, 2021.