MVB Financial Corp. Reports Q4 and Full-Year 2024 Financial Results
MVB Financial Corp. (NASDAQ: MVBF) (“MVB Financial,” “MVB” or the “Company”), the holding company for MVB Bank, Inc. (“MVB Bank”), has released its financial results for the fourth quarter and full year ended December 31, 2024. The company reported a net income of $9.4 million, equating to $0.73 per basic share and $0.72 per diluted share for the three-month period concluding on December 31, 2024.
Strategic Insights from Leadership
Larry F. Mazza, Chief Executive Officer of MVB Financial, reflected on the company’s financial performance and strategic direction:
“Despite the challenges presented in the fourth quarter, MVB has remained agile, refining its strategic focus to ensure long-term success. The past year was one of transformation, as we streamlined our growth strategy and fortified our team to make key investments in our future. We also made significant leadership appointments to drive this shift. In mid-November, we welcomed risk management industry veteran Joe Rodriguez, formerly of Capital One, as Chief Risk Officer. His expertise will help MVB integrate risk management as a fundamental business driver. Additionally, in early 2025, we appointed Jeffrey Weidley as Chief Deposit Officer. With extensive experience in banking within the DC metro area, Jeffrey will lead our efforts to expand MVB’s deposit base.”
Looking forward, Mazza expressed confidence in the continued evolution of MVB’s business model, highlighting a strong core funding profile, robust liquidity, solid MVB Financial capital management, and stable asset quality. He emphasized the company’s focus on the payments sector, leveraging innovative solutions to support existing clients and generate revenue. Mazza MVB Financial also pointed to an optimistic economic outlook and strong loan pipelines as indicators of MVB’s ability to seize future opportunities and create long-term value for clients and stakeholders.
Key Financial Highlights – Fourth Quarter 2024
Revenue Growth and Expense Management
- Noninterest income surged by $14.6 million (219.7%) from the previous quarter, totaling $21.3 million. This increase stemmed largely from an $11.8 million gain on asset sales, part of a previously announced sale-leaseback transaction, along with an increase of $1.2 million in other operating income driven by net deposit network fee income and revenue from the Victor Technologies subsidiary. Additionally, there was a $1.0 million gain on loan sales.
- Noninterest expense rose $4.1 million (14.0%) from the previous quarter to $33.6 million, primarily due to higher personnel costs, increased MVB Financial professional fees, and greater operating expenses driven by higher transaction volume in correspondent banking.
Capital and Liquidity Strength
- The Community Bank Leverage Ratio, Tier 1 Risk-Based Capital Ratio, and MVB Bank’s Total Risk-Based Capital Ratio stood at 11.2%, 15.1%, and 15.8%, respectively, showing modest increases from the previous quarter.
- The tangible common equity ratio increased to 9.7%, compared to 8.8% at the end of Q3 2024.
- Book value per share and tangible book value per share rose 0.7% quarter-over-quarter, standing at $23.61 and $23.37, respectively.
- Nonperforming loans declined $3.9 million (13.8%) to $24.6 million, representing 1.2% of total loans, a slight improvement from 1.3% in the previous quarter.
- Provision for credit losses totaled $0.3 million, down from $1.0 million in the prior quarter, driven by lower loan balances. The allowance for credit losses stood at 0.9% of total loans, compared to 1.0% in Q3 2024.
Income Statement Analysis
Net Interest Income and Margin
- Net interest income on a tax-equivalent basis totaled $25.1 million, marking a $1.7 million (6.3%) decline from Q3 2024 and a $6.2 million (19.8%) decline from Q4 2023. The primary driver of this decline was a contracting net interest margin and lower average earning asset balances.
- Interest income dropped $3.6 million (7.7%) from Q3 2024 and $6.6 million (13.4%) from Q4 2023 due to lower loan balances and the impact of declining interest rates on loans and cash holdings.
- Interest expense declined $1.9 million (9.4%) quarter-over-quarter but increased $0.4 million (2.4%) from Q4 2023, reflecting changes in funding costs and the mix of deposit funding.
- On a fully tax-equivalent basis, the net interest margin for Q4 2024 was 3.46%, down 15 basis points from Q3 2024 and 60 basis points from Q4 2023. The margin decline was attributed to lower loan balances and increased funding costs.
Noninterest Income Growth
- Noninterest income increased by $14.6 million (219.7%) from Q3 2024 and $16.8 million (379.5%) from Q4 2023, largely driven by gains on asset sales and growth in revenue from Victor Technologies.
- Income from equity method investments also contributed to noninterest income growth, with mortgage companies generating $1.3 million in income compared to a $2.4 million loss in Q4 2023.
Noninterest Expense Growth
- Noninterest expense totaled $33.6 million, an increase of $4.1 million (14.0%) from Q3 2024 and $5.3 million (18.8%) from Q4 2023.
- The key cost drivers included a $2.1 million increase in employee benefits and incentive compensation, $1.1 million in professional fees, and $0.9 million in higher banking fees due to greater transaction volume.
Balance Sheet Overview
Loans and Deposits
- Total loans stood at $2.10 billion as of December 31, 2024, declining $71.1 million (3.3%) from Q3 2024 and $217.5 million (9.4%) from December 31, 2023. This decline was due to loan sales, subdued loan growth, and the impact of loan amortization and payoffs.
- Total deposits were $2.69 billion, down $308.0 million (10.3%) from Q3 2024 and $207.9 million (7.2%) from Q4 2023. The decline resulted from the use of off-balance sheet deposit networks to optimize fee income, capital efficiency, and liquidity management.
- Non-interest-bearing (NIB) deposits stood at $941.0 million, a drop of $48.2 million (4.9%) from Q3 2024 and $256.3 million (21.4%) from Q4 2023. The decline reflects strategic exits from digital asset program accounts.
