Bank of Virginia Announces Second Quarter and Year-to-Date Earnings


MIDLOTHIAN, Va., July 22, 2008 (PRIME NEWSWIRE) -- Frank Bell, III, President and Chief Executive Officer of Bank of Virginia (Nasdaq:BOVA) (www.bankofva.com) announced the Bank's second quarter 2008 financial performance today. The Bank reported a profit of $56 thousand or $0.02 cents per basic and diluted earnings per share. The 2nd Quarter 2008 results compare favorably with the $89 thousand operating loss reported at March 31, 2008. In addition, total assets increased 6.4%, growing from $184.0 million at year-end 2007 to $195.7 million as of June 30, 2008.

Frank Bell said, "Bank of Virginia continues to grow given the current economic conditions we are facing. We are pleased that we have been able to improve our margin through the company's direction of aggressive deposit repricing, expense control and overall sound management of the loan portfolio."

The major component of the growth was the loan portfolio. Net loan balances (net of allowance for loan loss) increased from $130.8 million at December 31, 2007 to $142.9 million, which represents a 9.3% increase for the six-month period ending June 30, 2008.

Continuing into the second quarter 2008, the Bank experienced pressures from margins and expenses associated with operational growth, specifically from the new Patterson Avenue office. Frank Bell, President and Chief Executive Officer stated, "Although we are feeling the impact of the economy, our overall business continues to grow and our net interest margin continues to improve, which has led to improved results. With the current economic conditions showing no immediate signs of improvement, we continue to monitor our loan portfolio closely and place a strong emphasis on increasing core deposits. We also will continue to focus on monitoring operating expenses so we are able to continue to perform well."

For 12 months ending June 30, 2008, total assets increased 24.9% while liabilities increased 28.0%. As of June 30, 2008, total deposits were $158.9 million compared to year-end 2007 balances of $155.0 million. This represents a 2.5% increase for the year. Bank of Virginia is a commercial bank and the Bank's underlying portfolio of loans is diversified with various types of commercial loans. Consumer lending including first mortgage home lending is a very small component of the Bank's portfolio, and as a result, exposure to the mortgage industry has been kept to a minimum. While non-performing assets did increase at quarter-end to $441 thousand, the underlying collateral is in the process of being liquidated in the third quarter and the losses are expected to be minimal. The management team of the Bank remains very pleased that the company has continued to grow while maintaining good asset quality.

"Our customer base continues to grow and we are pleased what we have accomplished as a team. Although we are operating in difficult times we continue to perform well," Bell concluded.

The Bank currently operates five full-service offices in Chesterfield and Henrico Counties in Virginia. Bank of Virginia common stock is traded on the NASDAQ stock market under the quotation symbol "BOVA". Additional investor relations information can be found on the internet at 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 Bank's periodic filings with the Board of Governors of the Federal Reserve System, including the Bank's annual report on Form 10-KSB as filed with the Board of Governors of the Federal Reserve. Pursuant to the Private Securities Litigation Reform Act of 1995, the Bank does not undertake to update forward-looking statements contained within this news release.



 BANK OF VIRGINIA
 Statements of Operations
 (Unaudited)

                           Three Months and         Six Months and
                             Period Ended            Period Ended
                        ----------------------  ----------------------
                               June 30,                June 30,
                           2008        2007        2008        2007
                        ----------  ----------  ----------  ----------
 Interest Income:
  Interest and fees on
   loans                $2,492,291  $2,342,915  $5,022,232  $4,449,975
  Investment securities    546,252     331,499   1,118,814     638,303
  Interest on federal
   funds sold and
   deposits with banks       5,260      91,918      51,905     185,509
                        ----------  ----------  ----------  ----------
   Total interest
    income               3,043,803   2,766,332   6,192,951   5,273,787
                        ----------  ----------  ----------  ----------

 Interest Expense:
  Interest on deposits   1,587,608   1,447,216   3,356,887   2,745,844
  Interest on fed funds
   purchased and FHLB
   borrowings              136,035      55,841     251,145     110,529
                        ----------  ----------  ----------  ----------
   Total interest
    expense              1,723,643   1,503,057   3,608,032   2,856,373
                        ----------  ----------  ----------  ----------
   Net interest income   1,320,160   1,263,275   2,584,919   2,417,414
  Provision for loan
   losses                   30,000     104,928     143,251     191,765
                        ----------  ----------  ----------  ----------
  Net interest income
   after provision for
   loan losses           1,290,160   1,158,347   2,441,668   2,225,649
                        ----------  ----------  ----------  ----------

 Non-interest Income:
  Service charges on
   deposit accounts         51,579      32,707     104,060      54,486
  Net gain on available
   for sale securities      68,568          --     123,664           0
  Other fee income          32,366      19,819      64,494      37,546
                        ----------  ----------  ----------  ----------
   Total non-interest
    income                 152,513      52,526     292,218      92,032
                        ----------  ----------  ----------  ----------

 Non-interest Expense:
  Salaries and employee
   benefits                778,051     675,893   1,551,230   1,260,669
  Occupancy expense        105,203      88,946     204,676     164,761
  Equipment expense         74,149      52,845     155,931     103,711
  Data processing          105,371      83,614     202,337     165,543
  Marketing expense         46,725      25,322     140,931      72,137
  Legal and professional
   fees                     66,247      29,064     105,948      71,365
  Other operating
   expenses                210,448     136,287     405,367     255,638
                        ----------  ----------  ----------  ----------
   Total non-interest
    expenses             1,386,194   1,091,971   2,766,420   2,093,824
                        ----------  ----------  ----------  ----------

   Net income (loss)    $   56,479  $  118,902  $  (32,534) $  223,857
                        ==========  ==========  ==========  ==========

  Income (loss) per
   share, basic and
   diluted              $     0.02  $     0.04  $    (0.01) $     0.07
                        ==========  ==========  ==========  ==========
  Weighted Average
   Shares Outstanding:
   Basic                 3,031,866   3,031,866   3,031,866   3,031,866
                        ==========  ==========  ==========  ==========
   Diluted               3,035,353   3,032,851   3,033,610   3,032,494
                        ==========  ==========  ==========  ==========
  At period end:
   Book value per share       5.66        5.66
   Market value per
    share                     6.30        8.40


 BANK OF VIRGINIA
 Balance Sheets

                                              June 30,    December 31,
                                                2008          2007
                                              Unaudited     Audited
                                            ------------  ------------

 Assets
  Cash and due from banks                   $  2,758,391  $  4,183,359
  Federal funds sold and interest-bearing
   balances with banks                         3,990,008     4,771,376
                                            ------------  ------------
                                               6,748,399     8,954,735
  Securities available for sale, at fair
   market value                               39,046,579    37,641,272
  Loans, net of allowance for loan losses
   of $1,419,977 in 2008 and $1,276,726 in
   2007                                      142,888,522   130,805,447
  Premises and equipment, net                  5,802,492     5,532,009
  Accrued interest receivable                    833,585       857,853
  Other assets                                   377,214       217,311
                                            ------------  ------------

    Total assets                            $195,696,791  $184,008,627
                                            ============  ============

 Liabilities
  Deposits:
  Noninterest-bearing                       $ 13,705,569  $ 13,020,632
  Savings and interest-bearing demand         16,320,273    17,122,793
  Time, $100,000 and over                     49,214,197    46,155,151
  Other time                                  79,708,718    78,586,170
                                            ------------  ------------
    Total deposits                           158,948,757   154,884,746
  Accrued expenses and other liabilities       1,088,789     1,119,459
  FHLB borrowings and other indebtedness      18,505,000    10,000,000
                                            ------------  ------------
    Total liabilities                        178,542,546   166,004,205
                                            ------------  ------------

 Stockholders' Equity
  Preferred stock, $5 par value, 5,000,000
   shares authorized, none issued                     --            --
  Common stock, $2.50 par value, 40,000,000
   shares authorized, 3,031,866 shares
   issued and outstanding in 2007 and 2006,
   respectively                                7,579,665     7,579,665
  Additional paid-in capital                  14,699,300    14,693,218
  Retained (deficit)                          (4,631,880)   (4,599,346)
  Accumulated other comprehensive (loss)
   income                                       (493,840)      330,885
                                            ------------  ------------
    Total stockholders' equity                17,153,245    18,004,422
                                            ------------  ------------

    Total liabilities and stockholders'
     equity                                 $195,695,791  $184,008,627
                                            ============  ============


 BANK OF VIRGINIA
 Selected Historical Information
 (Unaudited)

                  June 30,  March 31,  Dec. 31,   Sept. 30,  June 30,
                    2008      2008       2007       2007       2007
                 ---------  ---------  ---------  ---------  ---------

 Asset Quality
  Analysis:

 Allowance for
  loan losses:
 Beginning
  balance        1,389,977  1,276,726  1,178,361  1,122,957  1,018,029
   Provision        30,000    113,251     98,365     55,404    104,928
   Charge-offs          --         --         --         --         --
   Recoveries           --         --         --         --         --
                 ---------  ---------  ---------  ---------  ---------
  Net charge-offs       --         --         --         --         --
                 ---------  ---------  ---------  ---------  ---------
    Ending
     Balance     1,419,977  1,389,977  1,276,726  1,178,361  1,122,957
                 =========  =========  =========  =========  =========

 Nonperforming
  Assets:
 Nonaccrual loans       --         --         --         --         --
 Foreclosed real
  estate           441,481         --         --         --         --
 Repossessions          --         --         --         --         --
 Loans 90 days or
  more past due
  and still
  accruing              --         --         --         --         --
                 ---------  ---------  ---------  ---------  ---------
    Nonperforming
     assets        441,481         --         --         --         --
                 =========  =========  =========  =========  =========

 Allowance for
  loan & lease
  losses as a
  percent of
  loans               0.98%      0.97%      0.97%      0.96%      0.95%


            

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