GALLIPOLIS, Ohio - Ohio Valley Banc Corp. [NASDAQ:OVBC] ("OVBC") today announced a decrease in net income for the second quarter ending June 30, 2024. The company reported consolidated net income of $2,972,000, which is a reduction of $277,000 from the same period last year. Earnings per share for the second quarter stood at $0.63, compared to $0.68 in the prior year's second quarter.
For the first half of 2024, net income was $5,765,000, marking a 19.4% decrease from the first six months of 2023. Return on average assets and equity for the first half of the year were 0.84% and 8.01% respectively, down from 1.16% and 10.63% for the same period in the previous year.
Larry Miller, President and CEO of Ohio Valley Banc Corp., commented on the company's performance amidst challenging economic conditions, highlighting the launch of the SWEET HOME OHIO account, a high-interest savings product aimed at aiding home buyers in Ohio.
The increase in net interest income for the quarter was $349,000, but a six-month comparison showed a $183,000 decrease from the prior year. A significant factor was the rise in the cost of funding sources, which outpaced the yield on earning assets. This was due to increased rates on deposit accounts and a shift towards more expensive funding sources like certificates of deposit and wholesale funding.
The provision for credit loss expense for the quarter was $181,000, up by $157,000 from the previous year, primarily due to a $50 million increase in loan balances. Nonperforming loans as a percentage of total loans rose to 0.50% at the end of the quarter, up from 0.26% at the end of 2023.
Noninterest income saw a slight decrease for both the three and six-month periods, mainly attributable to the closure of Race Day Mortgage at the end of 2023. Conversely, service charges on deposit accounts rose by $192,000 year-to-date.
Noninterest expenses for the second quarter increased by $448,000 compared to the same period last year, with the largest increase in salaries and employee benefits. The company also reported increased expenses in data processing and professional fees.
Total assets as of June 30, 2024, were $1.403 billion, a $51 million increase from December 31, 2023. Loan balances increased by $68 million, funded by a $51 million increase in deposits. Shareholders' equity also saw a modest increase of $1.8 million from the end of 2023.
The company's stock is traded on the NASDAQ Global Market under the symbol OVBC. It owns The Ohio Valley Bank Company, with 17 offices in Ohio and West Virginia, and Loan Central, Inc. with six consumer finance offices in Ohio.
The press release includes forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially from expectations.
This financial overview is based on the latest 8-K filing with the Securities and Exchange Commission.
InvestingPro Insights
Following Ohio Valley Banc Corp.'s announcement of decreased net income and earnings per share for the second quarter, an analysis of real-time data from InvestingPro provides additional context for investors. Ohio Valley Banc Corp. has a market capitalization of $110.54 million and a price-to-earnings (P/E) ratio that stands at 9.57, reflecting a potential value opportunity compared to the industry average.
The company's commitment to shareholder returns is evident in its track record of maintaining dividend payments for 31 consecutive years, with a dividend yield of 3.85% as of the latest data, showcasing its stability and reliability as an income-generating investment.
InvestingPro Tips highlight the company's strong performance over the last month, with a 15.82% total price return, signaling a positive short-term momentum that could interest investors looking for recent growth. Moreover, Ohio Valley Banc Corp. has been profitable over the last twelve months, which is a fundamental indicator of the company's financial health. These insights, coupled with the InvestingPro Fair Value estimate of $25.41, which suggests a potential undervaluation at the current price of $23.06, may provide a compelling case for investors considering this stock.
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