CVB Financial Corp. (Nasdaq:CVBF), parent company of Citizens Business Bank, today announced record earnings of $49.7 million for the year ended Dec. 31, 2002.
This represents an increase of $9.7 million, or 24.2%, when compared with earnings of $40 million for the year ended Dec. 31, 2001.
Diluted earnings per share were $1.11 for 2002. This is up $0.21, or 23.3%, from the $0.90 posted for 2001. All per share amounts have been restated to reflect the 5-for-4 stock split declared on Dec. 18, 2002. Earnings for the year produced a return on beginning equity of 22.5%, a return on average equity of 20.5% and a return on average assets of 1.8%.
During the year, the company restructured a portion of the investment portfolio to align it with the current interest rate environment. This involved the sale of $261.2 million in securities. The sale of these securities resulted in a gain of $4.9 million before taxes, and a gain of $3.2 million after taxes.
If the company had not realized this gain on the sale of securities, net income would have been $46.5 million. This would represent an increase in net income of $6.5 million, or 16.27%, over the $40 million for 2001. The comparable net income per diluted share would be $1.04. This would be an increase of $0.14, or 15.56%, over the net income per diluted share of $0.90 for 2001.
These earnings results would have produced a return on beginning equity of 21.1%, a return on average equity of 19.4% and a return on average assets of 1.71%. The related efficiency ratio would have been 47.86%.
Earnings for the fourth quarter ending Dec. 31, 2002 were $12.6 million. This represents an increase of $1.8 million, or 16.4%, over the earnings of $10.8 million reported for the fourth quarter of 2001. This was the 43rd consecutive quarter of record earnings.
Diluted earnings per share for the fourth quarter of 2002 were $0.28. This is up $0.03, or 12%, from the $0.25 posted for the fourth quarter of 2001. All per share amounts have been restated to reflect the 5-for-4 stock split. Earnings for the fourth quarter produced a return on beginning equity of 23.1%, a return on average equity of 19.5% and a return on average assets of 1.8%
Deposits reached a record high of $2.3 billion at Dec. 31, 2002. This was up $433 million, or 23.1%, when compared with the $1.9 billion in deposits reported at Dec. 31, 2001. Demand deposits were $958.7 million, or 41.5% of the total deposits. This represents an increase of $192.3 million, or 25.1%, when compared with $766.3 million for last year.
Gross loans and leases were $1.4 billion at Dec. 31, 2002. This represents an increase of $258.5 million, or 21.8%, when compared with gross loans and leases of $1.2 billion on Dec. 31, 2001. Total assets reached a record high of $3.1 billion. This was up $607.6 million, or 24.2%, over total assets of $2.5 billion at the end of 2001.
CVB Financial Corp. reported non-performing loans and non-performing assets of $824,000 as of Dec. 31, 2002. This represents a ratio of non-performing assets to total assets of 0.03%. The allowance for loan and lease losses was $21.7 million as of Dec. 31, 2002.
This represents 1.5% of gross loans and leases, and compares with 1.72% on Dec. 31, 2001. Non-performing loans and leases were 3.8% of the allowance for loan and lease losses.
Linn Wiley, president and chief executive officer for CVB Financial Corp. and Citizens Business Bank, stated: "We are pleased to have achieved these new milestones in our growth and financial performance. Total assets exceeded $3.1 billion and earnings hit $49.7 million for the first time in our history.
"This reflects the commitment by everyone in our organization to provide superior performance for our customers, our communities and our shareholders."
The board of directors of CVB Financial Corp. declared a 5-for-4 stock split on Dec. 18, 2002. In addition, the board of directors declared a $0.12 cash dividend. The cash dividend will be paid on a post 5-for-4 stock split basis. This cash dividend represents the 53rd consecutive quarterly cash dividend paid by the company.
CVB Financial Corp. is the parent for Citizens Business Bank. Citizens Business Bank operates 32 Business Financial Centers in the Inland Empire, Los Angeles County, Orange County, and the Central Valley areas of California. Shares of CVB Financial Corp. common stock are listed on the Nasdaq under the ticker symbol of CVBF.
CVB FINANCIAL CORP.
CONSOLIDATED BALANCE SHEET
(unaudited)
dollars in thousands
Dec. 31
2002 2001
Assets:
Federal funds sold and
reverse repos $ 40,000 $ 20,000
Investment Securities
available-for-sale 1,452,499 1,181,503
Loans and lease finance
receivables 1,446,009 1,187,540
Less allowance for credit
losses (21,666) (20,469)
Net loans and lease
finance receivables 1,424,343 1,167,071
Total earning assets 2,916,842 2,368,574
Cash and due from banks 124,973 82,651
Premises and equipment, net 29,413 29,921
Goodwill and intangibles 14,049 6,482
Other assets 36,420 26,474
TOTAL $3,121,697 $2,514,102
Liabilities and Stockholders'
Equity
Liabilities:
Deposits:
Demand
Deposits (noninterest-
bearing) $ 958,671 $ 766,329
Investment Checking 195,419 170,047
Savings/MMDA 589,280 504,214
Time Deposits 566,595 436,369
Total Deposits 2,309,964 1,876,959
Other borrowings 468,000 375,000
Other liabilities 82,867 41,395
Total Liabilities 2,860,831 2,293,354
Stockholders' equity:
Stockholders' equity 235,210 206,779
Accumulated other
comprehensive income
(loss), net of tax 25,656 13,969
260,866 220,748
TOTAL $3,121,697 $2,514,102
CVB FINANCIAL CORP.
CONSOLIDATED AVERAGE BALANCE SHEET
(unaudited)
dollars in thousands
Three months ended Twelve months ended
Dec. 31 Dec. 31
2002 2001 2002 2001
Assets:
Federal funds sold and
reverse repos $ 28,666 $ 38,288 $ 31,877 $ 16,016
Investment securities
available-for-sale 1,343,589 1,151,798 1,279,216 1,100,536
Loans and lease
finance receivables 1,353,391 1,100,727 1,247,384 1,067,621
Less allowance for
credit losses (22,479) (21,173) (22,173) (20,541)
Net loans and lease
finance
receivables 1,330,912 1,079,554 1,225,211 1,047,080
Total earning
assets 2,703,167 2,269,640 2,536,304 2,163,632
Cash and due from
banks 117,044 106,836 112,535 98,421
Premises and equipment,
net 28,772 29,693 29,387 28,198
Other real estate owned,
net 0 0 0 173
Goodwill and intangibles 9,143 6,612 10,256 6,937
Other assets 31,423 21,092 36,017 28,572
TOTAL $2,889,549 $2,433,873 $2,724,499 $2,325,933
Liabilities and Stockholders'
Equity
Liabilities:
Deposits:
Noninterest-
bearing $ 872,327 $ 710,154 $ 807,505 $ 655,518
Interest-bearing 1,354,709 1,118,272 1,253,790 1,031,462
Total Deposits 2,227,036 1,828,426 2,061,295 1,686,980
Other borrowings 364,574 349,605 384,928 401,370
Other liabilities 35,661 28,717 34,987 28,589
Total Liabilities 2,627,271 2,206,748 2,481,210 2,116,939
Stockholders' equity:
Stockholders' equity 233,374 205,462 224,652 196,125
Accumulated other
comprehensive income
(loss), net of tax 28,904 21,663 18,637 12,869
262,278 227,125 243,289 208,994
TOTAL $2,889,549 $2,433,873 $2,724,499 $2,325,933
CVB FINANCIAL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(unaudited)
dollar amounts in thousands, except per share
For the Three Months For the Twelve Months
Ended Dec. 31, Ended Dec. 31,
2002 2001 2002 2001
Interest Income:
Loans, including fees $24,014 $21,375 $ 90,351 $ 90,002
Investment
securities:
Taxable 11,488 12,108 47,097 49,295
Tax-advantaged 4,145 4,228 16,273 16,114
Total investment
income 15,633 16,336 63,370 65,409
Federal funds sold 124 224 602 466
Total interest
income 39,771 37,935 154,323 155,877
Interest Expense:
Deposits 4,925 6,641 21,470 31,843
Borrowings 4,418 4,378 18,969 20,963
Total interest
expense 9,343 11,019 40,439 52,806
Net interest income
before provision for
credit losses 30,428 26,916 113,884 103,071
Provision for credit
losses 0 0 0 1,750
Net interest income
after provision for
credit losses 30,428 26,916 113,884 101,321
Other Operating Income:
Service charges on
deposit accounts 3,818 3,551 14,154 12,954
Wealth Management
services 872 930 3,764 3,841
Gain(Loss) on sale
of securities (43) 0 4,897 60
Gain on sale of
other real estate
owned 0 0 0 126
Other 1,746 1,031 6,203 5,211
Total other operating
income 6,393 5,512 29,018 22,192
Other operating
expenses:
Salaries and
employee benefits 9,204 8,481 35,970 32,625
Occupancy 1,608 1,377 6,339 5,658
Equipment 1,781 1,421 6,212 5,321
Professional
services 1,073 948 4,084 3,972
Goodwill
Amortization 297 215 578 920
Other 3,379 3,223 12,873 11,659
Total other
operating
expenses 17,342 15,665 66,056 60,155
Earnings before income
taxes 19,479 16,763 76,846 63,358
Income taxes 6,887 5,949 27,101 23,300
Net earnings $12,592 $10,814 $ 49,745 $ 40,058
Basic earnings per
common share $ 0.30 $ 0.25 $ 1.14 $ 0.92
Diluted earnings per
common share $ 0.28 $ 0.25 $ 1.11 $ 0.90
Cash dividends per
common share $ 0.12 $ 0.13 $ 0.54 $ 0.56
All per share information has been retroactively adjusted to
reflect the 5-for-4 stock split declared on Dec. 18, 2002.
Three months ended Twelve months ended
Dec. 31 Dec. 31
2002 2001 2002 2001
Interest income
- (Tax
Effective)(te) 41,512 39,711 161,158 162,645
Interest
Expense 9,343 11,019 40,439 52,806
Net Interest
income - (te) 32,169 28,692 120,719 109,839
Gain(Loss) on
sale of
securities (43) (0) 4,897 60
Gain on sale of
OREO 0 0 0 126
Return on
average assets 1.77% 1.80% 1.83% 1.72%
Return on
average equity 19.47% 19.31% 20.45% 19.17%
Efficiency
ratio 47.10% 48.31% 46.22% 48.02%
Net interest
margin (te) 4.79% 5.08% 4.72% 5.03%
Weighted
average shares
outstanding
Diluted 44,539,495 44,416,180 44,577,971 44,268,758
Basic 43,524,118 43,471,770 43,623,365 43,422,153
Dividend payout
ratio 33.08% 33.45% 39.71% 38.90%
Number of
shares
outstanding -
EOP 43,533,129 43,477,793
Book value per
share 5.99 5.08
Dec. 31
2002 2001
Non-performing
Assets (dollar
amount in
thousands):
Non-accrual
loans $190 $1,574
Loans past due
90 days or
more
and still
accruing
interest 634 4
Restructured
loans 0 0
Other real
estate owned
(OREO), net 0 0
Total non-
performing
assets $824 $1,578
Percentage of
non-performing
assets
to total
loans
outstanding
and OREO 0.06% 0.13%
Percentage of
non-performing
assets to
total assets 0.03% 0.06%
Non-performing
loans to
allowance for
loan losses 3.80% 7.71%
Net loan losses
to Average
loans 0.09% 0.04%
Allowance for
Credit Losses
at Beginning
of Period:
Citizens
Business
Bank $ 20,469 $ 19,152
Acquisition
of Western
Security
Bank 2,325
Total Loans
Charged-
Off (2,409) (1,048)
Total Loans
Recovered 1,281 615
Net Loans
Charged-Off (1,128) (433)
Provision
Charged to
Operating
Expense 0 1,750
Allowance for
Credit Losses
at End of
period 21,666 20,469
CVB Financial Corp., Ontario D. Linn Wiley, 909/980-4030