Ohio Valley Banc Corp reports 57.8% income surge

GALLIPOLIS, Ohio - Ohio Valley Banc Corp. [NASDAQ:OVBC], a regional bank with a market capitalization of $174 million, announced today a significant increase in its consolidated net income for the first quarter ending March 31, 2025. The company reported net income of $4.4 million, a 57.8% rise from the same period last year. Earnings per share for the quarter were $0.94, up from $0.58 for the first quarter of 2024. Additionally, the bank experienced improvements in return on average assets, which was 1.20%, and return on average equity at 11.82%. According to InvestingPro data, the stock has delivered impressive returns, gaining nearly 70% over the past year and maintaining a 32-year streak of consecutive dividend payments.

The company’s President and CEO, Larry Miller, attributed the robust start to 2025 to strategic decisions that led to growth in earning assets, an improving net interest margin, and controlled overhead expenses. He highlighted the positive impact of these decisions on shareholder value.

Net interest income for the quarter increased by $1.95 million compared to the first quarter of 2024, owing to growth in average earning assets and net interest margin. Average earning assets saw an increase of $136 million, led by growth in average securities and loans. The securities growth was tied to the Ohio Homebuyer Plus program and the associated Sweet Home Ohio deposit accounts, which attracted $7.7 million in balances and $82 million in deposits from the Ohio Treasurer at subsidized interest rates.

The net interest margin for the first quarter of 2025 was 3.85%, up from 3.61% for the same period in 2024. This was due to an increase in the yield on earning assets and a decrease in the cost of funding sources. The provision for credit loss expense decreased by $335,000 from the first quarter of 2024, primarily related to lower general reserves and net charge-offs.

Noninterest income for the first quarter of 2025 saw a nominal decrease of $50,000 from the previous year, while noninterest expense witnessed a slight increase of $77,000. The company’s largest noninterest expense, salaries, and employee benefits, decreased by $155,000 due to a voluntary early retirement program initiated in 2024.

Total (EPA:TTEF) assets as of March 31, 2025, were $1.513 billion, marking a $10 million increase from the end of 2024. This increase was mainly due to a $35 million rise in balances maintained at the Federal Reserve. Shareholders’ equity also saw an increase of $5.4 million from the end of the previous year, driven by net income and an increase in accumulated other comprehensive income. InvestingPro analysis indicates the bank maintains healthy financial metrics with a P/E ratio of 15.95 and a dividend yield of 2.42%. While the company shows strong operational performance, InvestingPro’s Fair Value model suggests the stock may be trading above its intrinsic value at the current price of $36.99.

Ohio Valley Banc Corp. operates The Ohio Valley Bank Company with 17 offices in Ohio and West Virginia, as well as Loan Central, Inc. with six consumer finance offices in Ohio. This report is based on a press release statement.

In other recent news, Ohio Valley Banc Corp. announced a quarterly cash dividend increase, setting it at $0.23 per share, up from the previous quarter’s $0.22. This 4.55% increase will be paid to shareholders on May 10, 2025, with the record date set for April 25, 2025. The dividend increase reflects the company’s commitment to shareholder value and financial stability, despite reporting a decline in net income for the fourth quarter and the full year ending December 31, 2024. The quarterly net income fell to $2,515,000 from $3,223,000 the previous year, while annual net income decreased by 12.9% to $10,999,000. Earnings per share also dropped, with the fourth quarter at $.53 compared to $.68 the previous year, and the full-year EPS at $2.32, down from $2.65 in 2023. The decline in net income was attributed to significant one-time expenses, including a $3.3 million voluntary early retirement program and $496,000 in account bonuses. Despite these challenges, net interest income rose due to an increase in average earning assets driven by loan growth. The company also reported an increase in total assets to $1.503 billion, marking a $151 million rise from the previous year.

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