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MVB News
Interest Rate Decline Impacts Earnings 10/23/2017

MVB (OTCBB:MIVB) today reported that earnings for the nine month period ended September 30, 2017, were down from last year in spite of continued good growth in both deposits and loans. Net Income for the period was $1,011,400 compared to $1,338,900 for the first nine months of 2017. Earnings per diluted share were $.94 compared to $1.20 per diluted share for the prior year's comparable period.

At September 30, 2017, net loans totaled $116.2 million, up 11% over last year. Total deposits of $159.6 million were almost 12% higher and total assets stood at $174.2 million, up 12%.

John B. Dickerson, President & CEO of MVB stated, "The rapid decline in interest rates this year has put pressure on our net interest margin, which drives our profitability. In a declining rate environment, our earning assets, primarily loans, reprice faster than our deposits over the short term."

The bank reported that some agricultural loan customers, particularly in tree crops, have been impacted by low commodity prices. The Klamath Basin water crisis also affected a limited number of customers earlier in the year. "As a result, we have significantly increased our reserves for loan losses during the first nine months of 2017. We expect that trend to continue into the fourth quarter as well," stated Dickerson. "Non-agricultural sectors, particularly real estate construction lending, which constitutes the bulk of our loan portfolio, continue to perform satisfactorily."

Net interest income for the nine-month period totaled $5.1 million, down slightly compared to last year. Non-interest income of $1,352,000 increased 39% versus $974,000 in the prior period. Non-interest expenses were up 4% from last year's comparable period. Reserves for loan losses totaling $1.6 million at September 30, 2017 represented 1.4% of gross loans. Loan losses for the nine-month period totaled 0.69% of gross loans.

Headquartered in Red Bluff, MVB is a community business bank with two additional full service offices in Redding and one in Corning. A loan production office serves the Chico market. The bank focuses on real estate construction lending, agricultural loans and commercial lending to the business and professional community. More information about the bank can be obtained at its website, www.midvalleybank.com.

This news release includes forward-looking statements about MVB's financial condition, results of operations, plans, objectives and future performance. A number of factors, many of which are beyond the control of MVB, could cause actual results to differ materially from those in the forward-looking statements.

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