Codorus Valley Bancorp, Inc. Reports First Quarter 2016 Earnings

YORK, Pa., April 21, 2016 /PRNewswire/ -- Codorus Valley Bancorp, Inc. (Codorus Valley, or the Corporation) (NASDAQ: CVLY), parent company of PeoplesBank, a Codorus Valley Company (PeoplesBank), today announced net income available to common shareholders (earnings) of $2.8 million or $0.35 per share basic and diluted, for the quarter ended March 31, 2016, as compared to earnings of $2.4 million or $0.39 per share basic and diluted, for the first quarter of 2015.  The decrease in earnings per share was primarily a result of the 1,746,850 common shares issued in the $34.5 million public offering completed in December 2015.    

Larry J. Miller, Chairman, President and CEO, stated, "Our strong first quarter performance reflects the continued growth and profitability of our core commercial, retail and wealth management businesses.  During the first quarter 2016, our loan and deposit portfolios each reflected increases of $27 million, accompanied by increases in the net interest margin, service fees on deposits and wealth management fees.   We also continued the expansion of the PeoplesBank franchise by opening a limited service facility on the Masonic Village campus in Lancaster County, Pennsylvania, representing our initial entry into this highly-attractive market.  The opening of this facility has proven to be very successful based on the significant number of accounts and deposits generated in a short period of time."  

The Corporation's net interest income for the first quarter of 2016 was $13.0 million, an increase of $1.3 million or 11% when compared to the net interest income of $11.7 million for the first quarter of 2015.  The growth was driven by an increased volume of interest earning assets, primarily commercial loans.  The Corporation realized a net interest margin of 3.95% for the first quarter of 2016, which was comparable to the net interest margin of 3.93% for the first quarter of 2015.  PeoplesBank continues to have success in growing low cost core deposits, while maintaining reasonable loan yields in a highly competitive pricing environment.

The provision for loan losses for the first quarter of 2016 was $800,000, a decrease of $200,000 as compared to a provision of $1.0 million for the first quarter of 2015.  The decrease was positively impacted by a $313,000 reduction in net charge-offs in the first quarter of 2016 compared to the same period in 2015.  Due to continued collection and successful workout efforts, the Corporation's nonperforming assets ratio was 0.56% as of March 31, 2016, reflecting a favorable year-over-year decrease when compared to a nonperforming asset ratio of 0.99% as of March 31, 2015.

Noninterest income for the first quarter of 2016 and 2015 was $2.4 million.  While noninterest income was flat, there was an increase in wealth management income and service charges on deposit accounts, which was offset by a decrease in gains from sales of mortgage loans and securities.

Noninterest expense was $10.5 million for the first quarter of 2016, an increase of $869,000 as compared to noninterest expense of $9.6 million for the first quarter of 2015.  Personnel costs, which include compensation and benefit expenses, accounted for $737,000 of the increase, and is due to a combination of normal business growth and 2016 including a full quarter impact of the Corporation's January 2015 acquisition of Madison Bancorp, Inc.  Marketing costs increased $250,000 due to planned initiatives related to the continued expansion of our franchise along with the initial expenses associated with the acquisition of the naming rights to PeoplesBank Park, the facility that houses the York, Pennsylvania based York Revolution independent league baseball team.  Noninterest expenses for the first quarter of 2015 included $425,000 of nonrecurring costs associated the acquisition of Madison Bancorp, Inc. 

Other News

As previously announced, on February 18, 2016, the Corporation completed the redemption of all 12,000 remaining shares of the Corporation's Senior Non-Cumulative Perpetual Preferred Stock, Series B, that had been issued to the United States Treasury in August 2011 in connection with the Corporation's participation in the Small Business Lending Fund program.

As recently announced, on April 12, 2016, the Board of Directors of the Corporation declared a regular quarterly cash dividend of $0.13 per share, payable on May 10, 2016 to shareholders of record at the close of business on April 26, 2016.  The quarterly cash dividend is the same amount as paid in the previous quarter.

The first quarter of 2016 also included several important changes to the Board and management of the Corporation and PeoplesBank.  In January, the Corporation announced that Brian Brunner was appointed as a Class A Director of the Corporation.  Mr. Brunner served as a member of the Board of Directors of PeoplesBank since September 2015.  On March 8, 2016, Larry J. Miller retired from his position as President and Chief Executive Officer of PeoplesBank and was appointed to the position of Executive Chairman of PeoplesBank.  In connection with Mr. Miller's retirement, A. Dwight Utz was appointed President, Chief Executive Officer and a member of the Board of Directors of PeoplesBank.  In addition, Matthew A. Clemens was named Chief Administrative Officer and Diane E. Baker was named Chief Risk Officer of PeoplesBank.

About Codorus Valley Bancorp, Inc.

Codorus Valley Bancorp, Inc. is the largest independent financial services holding company headquartered in York, Pennsylvania.  Codorus Valley primarily operates through its financial services subsidiary, PeoplesBank, A Codorus Valley Company.  In addition to a full range of business and consumer banking services, the Corporation also offers mortgage banking, wealth management, and real estate settlement services through a network of twenty-five financial centers located in York, Cumberland and Lancaster Counties in Pennsylvania, and in Baltimore, Harford and Carroll Counties in Maryland.  Additional information can be found on PeoplesBank's website at www.peoplesbanknet.com.  Codorus Valley Bancorp, Inc.'s common stock is listed on the NASDAQ Global Market under the symbol CVLY.

Forward-looking Statements

Codorus Valley Bancorp, Inc. has made forward-looking statements in this Press Release.  These forward-looking statements are subject to risks and uncertainties.  Forward-looking statements include information concerning possible or assumed future results of operations of the Corporation and its subsidiaries.  When words such as "believes," "expects," "anticipates," or similar expressions occur in this Press Release, the Corporation is making forward-looking statements.  Note that many factors could affect the future financial results of the Corporation and its subsidiaries, both individually and collectively, and could cause those results to differ materially from those expressed in the forward-looking statements contained in this Press Release. Those factors include, but are not limited to: credit risk, changes in market interest rates, inability to achieve merger-related synergies, competition, economic downturn or recession, and government regulation and supervision.  The Corporation undertakes no obligation to update or revise any forward-looking statements.

Accounting standards require the consideration of subsequent events occurring after the balance sheet date for matters that require adjustment to, or disclosure in, the consolidated financial statements. The review period for subsequent events extends up to and including the filing date of a public company's financial statements when filed with the Securities and Exchange Commission. Accordingly, the consolidated financial information in this announcement is subject to change.

Questions or comments concerning this Press Release should be directed to:

Codorus Valley Bancorp, Inc.              
Larry J. Miller, Chairman, President and CEO                                              
717-747-1500                                                                         
[email protected]                                                

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SOURCE Codorus Valley Bancorp, Inc.

Related Links

http://www.peoplesbanknet.com