FVCBank Announces Fourth Quarter and Full Year 2024 Earnings; Continued Growth in Profitability, Net Interest Income and Margin
FAIRFAX, Va.–(BUSINESS WIRE)– FVCBankcorp, Inc. (NASDAQ: FVCB) (the “Company”) today reported its financial results for the fourth quarter and full year of 2024.
Fourth Quarter Selected Financial Highlights
- Net Income Increased 5% Compared to the Prior Quarter. Net income totaled $4.9 million, or $0.26 diluted earnings per share, for the quarter ended December 31, 2024, compared to net income of $4.7 million, or $0.25 diluted earnings per share, for the quarter ended September 30, 2024. Return on average assets for the quarter ended December 31, 2024 was 0.90%, an increase from 0.85% for the quarter ended September 30, 2024.
- Net Interest Margin Improved 17% Compared to the Year Ago Quarter.Net interest income increased $2.3 million, or 18%, to $14.9 million for the fourth quarter 2024, compared to $12.7 million for the year ago quarter ended December 31, 2024. Net interest margin increased 40 basis points, or 17%, to 2.77% for the fourth quarter of 2024, compared to 2.37% for the fourth quarter of 2023. On a linked quarter basis, net interest margin increased 13 basis points, or 5%, from 2.64% for the three months ended September 30, 2024, the fourth consecutive quarter of margin improvement.
- Noninterest Expense Decreased 2% for Both Fourth Quarter and Full Year 2024. Noninterest expense for the quarter ended December 31, 2024 totaled $9.0 million, a decrease of $194 thousand, or 2%, when compared to the linked quarter ended September 30, 2024 and decreased $400 thousand, or 4%, when compared to the year ago quarter ended December 31, 2023. The efficiency ratio for the quarter ended December 31, 2024 improved to 58.6%. Year-over-year, noninterest expense decreased $842 thousand, or 2%.
- Sound, Well Capitalized Balance Sheet.All of FVCbank’s (the “Bank”) regulatory capital components and ratios were in excess of thresholds required to be considered “well capitalized,” with total risk-based capital to risk-weighted assets of 14.73% at December 31, 2024, compared to 13.83% at December 31, 2023, an increase of 7%. The tangible common equity (“TCE”) to tangible assets (“TA”) ratio for the Bank increased to 10.87% at December 31, 2024, from 10.12% at December 31, 2023. The Bank’s investment securities are classified as available-for-sale, and therefore the unrealized losses on these securities is fully reflected in the TCE/TA ratio.
For the three months ended December 31, 2024, the Company recorded net income of $4.9 million, or $0.26 diluted earnings per share, compared to a net loss of $5.1 million, or $0.28 diluted loss per share, for the quarter ended December 31, 2023. During the fourth quarter of 2023, the Company sold a portion of its investment portfolio totaling $61.4 million of book value available-for-sale securities which resulted in an after-tax loss of $8.5 million. In addition, the Company reduced excess office space and consolidated two branch locations which resulted in $336 thousand in lease write-offs and severance costs.
For the year ended December 31, 2024, the Company reported net income of $15.1 million, or $0.82 diluted earnings per share, an increase of $11.2 million, compared to net income of $3.8 million, or $0.21 diluted earnings per share for the year ended December 31, 2023. During 2024, the Company surrendered $48.0 million in bank-owned life insurance (“BOLI”), which resulted in a nonrecurring increase of $2.4 million to the Company’s tax provisioning related to the gain associated with the cash payout. For the year ended December 31, 2023, net income included after-tax losses totaling $12.2 million related to sale of $101.7 million in book value available-for-sale investment securities and nonrecurring noninterest expense totaling $457 thousand for office space reductions and severance costs.
Commercial bank operating earnings (non-GAAP) exclude the above noted taxes recorded for the aforementioned BOLI surrender during 2024 and the losses on the sale of available-for-sale investment securities during 2023 along with the office space reductions and severance costs. Excluding these nonrecurring items, commercial bank operating earnings for the quarters ended December 31, 2024 and 2023 were $4.9 million and $3.8 million, respectively, an increase of $1.1 million, or 30%. Commercial bank operating earnings for the year ended December 31, 2024 and 2023 were $17.4 million and $16.3 million, respectively, an increase of $1.1 million, or 7%. Diluted commercial bank operating earnings per share (non-GAAP) for the three months ended December 31, 2024 and 2023 were $0.26 and $0.21, respectively. Diluted commercial bank operating earnings per share (non-GAAP) for the year ended December 31, 2024 and 2023 were $0.95 and $0.90, respectively.
The Company considers commercial bank operating earnings a useful comparative financial measure of the Company’s operating performance over multiple periods. Commercial bank operating earnings are determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP”). A reconciliation of non-GAAP financial measures to their most comparable financial measure in accordance with GAAP can be found in the tables below.
