Oak Valley Bancorp: Q4 FY2025 earnings call

What management said about Q4 FY2025, from the documents filed with the SEC on 26 January 2026: press release. Guidance figures: 1 raised. The quarter’s numbers.

Key takeaways

Net income fell from third quarter: The company reported net income of $6,335,000, or $0.76 diluted EPS, down from $6,693,000 or $0.81 in the third quarter, and from $6,008,000 or $0.73 a year earlier. Source
Credit provision drove the decline: Management attributed the sequential decrease to a $865,000 provision for credit losses on a collateral-dependent loan placed on non-accrual status at year-end. Source
Net interest income rose sequentially: Net interest income was $19,457,000, up from $19,197,000 in the third quarter, which the company attributed to growth of $38.3 million in average earning assets. Source
Margin eased on rate cuts: Net interest margin was 4.14%, against 4.16% in the third quarter. Management attributed the decrease to three federal funds rate cuts totaling 75 basis points beginning September 2025. Source
Total assets passed $2 billion: Total assets were $2.02 billion at year-end, up $27.7 million from September 30, 2025 and $122.5 million from December 31, 2024. Source
Non-accrual loan lifted NPAs: Non-performing assets were $4.6 million, or 0.23% of total assets, against zero at September 30, 2025 and December 31, 2024, after one collateral-dependent loan moved to non-accrual in December. Source
Reserve ratio rose to 1.08%: The allowance as a percentage of gross loans rose to 1.08%, from 1.03% at September 30, 2025 and 1.04% at December 31, 2024. Source
Dividend raised to $0.375 per share: The board declared a $0.375 per share cash dividend, up from $0.300 per share paid in the third quarter of 2025, according to the financial highlights table. Source

“We are pleased to report another strong operational performance.”
Chris Courtney, Chief Executive Officer

Guidance

Area	Period	Figure	Against last quarter
Dividend per share Source	payment on February 13, 2026	$0.375 per share	Raised from $0.300
Dividend payout amount Source	payment date February 13, 2026	approximately $3,145,600

What changed from last quarter

New: A commercial real estate loan was placed on non-accrual in December 2025, so non-performing assets were $4.6 million at year-end, against zero at September 30, 2025. Source
New: The board declared a cash dividend of $0.375 per share, up from the $0.300 per share paid in the third quarter of 2025. Source

Quarterly earnings and drivers

Net income fell from third quarter: The company reported net income of $6,335,000, or $0.76 diluted EPS, down from $6,693,000 or $0.81 in the third quarter, and from $6,008,000 or $0.73 a year earlier. Source
Credit provision drove the decline: Management attributed the sequential decrease to a $865,000 provision for credit losses on a collateral-dependent loan placed on non-accrual status at year-end. Source
Full-year net income down 4.1%: Net income for 2025 was $23,913,000, or $2.88 diluted EPS, a 4.1% decrease from $24,948,000, or $3.02 diluted EPS, in 2024. Source
Return on equity eased: Return on average common equity was 12.32% in the fourth quarter, compared with 14.30% in the third quarter and 12.86% in the fourth quarter of 2024. Source
Earning asset growth lifted net interest income: Compared with the fourth quarter of 2024, the company attributed higher net interest income to growth of $95.3 million in average earning assets. Source

Net interest income and margin

Net interest income rose sequentially: Net interest income was $19,457,000, up from $19,197,000 in the third quarter, which the company attributed to growth of $38.3 million in average earning assets. Source
Margin eased on rate cuts: Net interest margin was 4.14%, against 4.16% in the third quarter. Management attributed the decrease to three federal funds rate cuts totaling 75 basis points beginning September 2025. Source
Funding costs held steady: Interest expense stabilized, with the average cost of funds at 0.76% in 2025, against 0.78% in 2024. Source
Full-year margin higher than 2024: Full-year net interest margin was 4.13%, compared with 4.07% in 2024. Management attributed the increase to higher loan yield and a lower average cost of funds. Source

“Our sustained growth and solid financial results have enabled us to reach the milestone of $2 billion in total assets and reflect the dedication of our team and our steadfast focus on building lasting relationships with our clients,”
Chris Courtney, Chief Executive Officer

Non-interest income and expenses

Non-interest income fell from third quarter: Non-interest income was $1,825,000, against $1,973,000 in the third quarter. The decrease was tied to death benefits from bank-owned life insurance redemptions received in the third quarter. Source
Year-end accruals lowered expenses: Non-interest expense was $12,262,000, down from $12,700,000 in the third quarter. The company attributed the decrease to year-end accrual adjustments. Source
Expenses higher than a year earlier: Compared with $11,548,000 in the fourth quarter of 2024, non-interest expense rose on staffing, board fees, data processing and general operating costs for servicing the loan and deposit portfolios. Source
Efficiency ratio fell from third quarter: The efficiency ratio was 55.94% in the fourth quarter, compared with 58.27% in the third quarter and 58.09% in the fourth quarter of 2024. Source

Balance sheet growth

Total assets passed $2 billion: Total assets were $2.02 billion at year-end, up $27.7 million from September 30, 2025 and $122.5 million from December 31, 2024. Source
Gross loans grew $31.1 million: Gross loans reached $1.14 billion, up $31.1 million from September 30, 2025 and $37.4 million from December 31, 2024. Source
Deposits rose in the quarter: Total deposits were $1.79 billion, up $18.1 million from September 30, 2025 and $97.3 million from December 31, 2024. Source
Cash below September level: Cash and cash equivalents were $232.2 million at December 31, 2025, against $247.2 million at September 30, 2025, which management described as liquidity. Source

Credit quality and reserves

Non-accrual loan lifted NPAs: Non-performing assets were $4.6 million, or 0.23% of total assets, against zero at September 30, 2025 and December 31, 2024, after one collateral-dependent loan moved to non-accrual in December. Source
Specific reserve set on loan: The loan was assessed individually against the appraised value of its commercial real estate collateral, and a specific reserve was included in the allowance calculation. Source
Reserve ratio rose to 1.08%: The allowance as a percentage of gross loans rose to 1.08%, from 1.03% at September 30, 2025 and 1.04% at December 31, 2024. Source
Commercial real estate reviewed for reserves: Management analyzed the commercial real estate segment within the allowance computation and concluded that reserves relative to gross loans remain at acceptable levels. Source

Capital, dividend and book value

Dividend raised to $0.375 per share: The board declared a $0.375 per share cash dividend, up from $0.300 per share paid in the third quarter of 2025, according to the financial highlights table. Source
Dividend payment about $3.1 million: The dividend is payable February 13, 2026 to holders of record at the close of business on February 2, 2026, an amount of approximately $3,145,600. Source
Book value per share increased: Book value per common share was $24.79 at period end, up from $23.63 in the third quarter and $21.95 in the fourth quarter of 2024. Source

Branches, staff and client focus

Nineteen branches across the footprint: The bank operates 19 branches, including three in its Eastern Sierra division, offering loan and deposit products to individuals and small businesses. Source
Staffing edged up to 238: Full-time equivalent staff was 238 at year-end, up from 237 in the third quarter. The table shows 19 banking offices at year-end. Source
Relationships cited as central focus: The CEO said the results reflect the team’s dedication and a focus on building lasting relationships with clients. Source

Coming up, as management said on 26 January 2026

Dividend payable February 13, 2026: The company said the dividend payment is scheduled for February 13, 2026, with a shareholder record date of February 2, 2026. Source

Figures management reported

Figure	Reported
Net interest margin Source	4.14% in fourth quarter 2025; 4.13% for full year 2025
Net interest income Source	$19,457,000 in fourth quarter 2025; $74,615,000 for full year 2025
Loans Source	gross loans $1.14 billion, up $31.1 million from September 30, 2025
Deposits Source	$1.79 billion, up $18.1 million from September 30, 2025
Deposit costs (average cost of funds) Source	0.76% in 2025, against 0.78% in 2024
Provision for credit losses Source	$865,000 in fourth quarter 2025
Nonperforming assets Source	$4.6 million, or 0.23% of total assets
Efficiency ratio Source	55.94% in fourth quarter 2025; 58.27% in third quarter 2025

Risks management discussed

Financial: A commercial real estate loan placed on non-accrual carries credit risk, with the reserve set against the appraised value of the collateral. Source
External: Management noted industry concern about credit risk in commercial real estate and reviewed that segment within the allowance computation. Source

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.

As filed with the SEC

Open the filing on EDGAR

Date:

January 23, 2026

OAK VALLEY BANCORP REPORTS 4 QUARTER RESULTS AND ANNOUNCES CASH DIVIDEND

OAKDALE, CA - Oak Valley Bancorp (NASDAQ: OVLY) (the “Company”), the bank holding company for Oak Valley Community Bank and their Eastern Sierra Community Bank division, recently reported unaudited consolidated financial results. For the three months ended December 31, 2025, consolidated net income was $6,335,000 or $0.76 per diluted share (EPS), as compared to $6,693,000, or $0.81 EPS, for the prior quarter and 6,008,000, or $0.73 EPS for the same period a year ago. Consolidated net income for the year ended December 31, 2025, totaled $23,913,000, or $2.88 EPS, representing a decrease of 4.1% compared to 24,948,000, or $3.02 EPS for 2024. The decrease in QTD earnings compared to the prior quarter is due to a provision for credit losses of $865,000 recorded during the quarter, related to a collateral-dependent loan that was placed on non-accrual status as of year-end. The QTD increase over the same period a year ago is due to earning asset growth of $95.3 million and the corresponding net interest income expansion.

“We are pleased to report another strong operational performance. Our sustained growth and solid financial results have enabled us to reach the milestone of $2 billion in total assets and reflect the dedication of our team and our steadfast focus on building lasting relationships with our clients,” said Chris Courtney, Chief Executive Officer.

Net interest income was $19,457,000 and $74,615,000 for the fourth quarter and year ended December 31, 2025, respectively, compared to $19,197,000 during the prior quarter, $17,846,000 for the fourth quarter of 2024, and $70,034,000 for the year ended December 31, 2024. The QTD increase compared to prior quarter is due to growth of $38.3 million in average earning assets. The QTD and YTD increases over 2024 are due to growth in average earning assets of $95.3 million and $85.9 million, respectively. Interest expense has stabilized as evidenced by the average cost of funds of 0.76% in 2025, compared to 0.78% in 2024.

Net interest margin was 4.14%(1) and 4.13%(3) for the fourth quarter and year ended December 31, 2025, respectively, as compared to 4.16%(1) for the prior quarter, 4.00%(1) for the fourth quarter of 2024, and 4.07%(3) for the year ended December 31, 2024. The fourth quarter interest margin decrease compared to the prior quarter is due to the three federal fund rate cuts totaling 75 basis points that began in September 2025. The QTD and YTD interest margin increases over the same periods in 2024 are the result of an increase in loan yield and a decrease in average cost of funds.

Non-interest income for the fourth quarter and year ended December 31, 2025, totaled $1,825,000 and $7,114,000, respectively, compared to $1,973,000 during the prior quarter, $1,430,000 for the fourth quarter of 2024, and $6,555,000 for the year ended December 31, 2024. The decrease from the prior quarter was due to death benefits received from the redemption of bank owned life insurance policies during the third quarter of 2025. The QTD and YTD increases from prior periods in 2024 were primarily due to unrealized market value changes on equity securities, investment advisory fee income, service charges on deposit accounts, and the YTD increase includes the previously mentioned life insurance benefits.

Non-interest expense for the fourth quarter and year ended December 31, 2025, totaled $12,262,000 and $50,274,000, respectively, compared to $12,700,000 during the prior quarter, $11,548,000 for the fourth quarter of 2024 and $46,017,000 for the year ended December 31, 2024. The decrease compared to the prior quarter is the result of year-end accrual adjustments. The QTD and YTD increases compared to the same periods in 2024 correspond to staffing expense, board of director fees, data processing, and general operating costs related to servicing the loan and deposit portfolios.

Total assets were $2.02 billion at December 31, 2025, an increase of $27.7 million over September 30, 2025, and $122.5 million over December 31, 2024. Gross loans were $1.14 billion as of December 31, 2025, an increase of $31.1 million from September 30, 2025, and $37.4 million from December 31, 2024. The Company’s total deposits were $1.79 billion as of December 31, 2025, an increase of $18.1 million from September 30, 2025, and $97.3 million from December 31, 2024. Our liquidity position remains strong as evidenced by $232.2 million in cash and cash equivalents balances at December 31, 2025.

Non-performing assets (“NPA”) as of December 31, 2025, were $4.6 million, or 0.23% of total assets, compared to zero NPA as of September 30, 2025 and December 31, 2024. The increase in NPA compared to the prior periods is due to one collateral-dependent loan that was placed on non-accrual status in December 2025, when management became aware that full collection of the loan balance was not likely. This loan was individually analyzed based on the appraised value of the commercial real estate collateral and a specific reserve was included in the allowance for credit losses (“ACL”) calculation. The company recorded a provision for credit losses of $865,000 during the fourth quarter recognizing the reserve for the collateral-dependent loan, combined with the pooled loan calculation which considers macro-economic conditions and other credit-related factors within our current expected credit loss (“CECL”) risk model. As a result, the ACL as a percentage of gross loans increased to 1.08% at December 31, 2025, compared to 1.03% at September 30, 2025 and 1.04% at December 31, 2024. Given industry concerns of credit risk specific to commercial real estate, management has performed a thorough analysis of this segment within the ACL computation, concluding that the credit loss reserves relative to gross loans remain at acceptable levels, and credit quality remains stable.

The Board of Directors of Oak Valley Bancorp at their January 20, 2026 meeting, declared the payment of a cash dividend of $0.375 per share of common stock to its shareholders of record at the close of business on February 2, 2026. The payment date will be February 13, 2026 and will amount to approximately $3,145,600. This is the first dividend payment made by the Company in 2026.

Oak Valley Bancorp operates Oak Valley Community Bank & their Eastern Sierra Community Bank division, through which it offers a variety of loan and deposit products to individuals and small businesses. They currently operate through 19 conveniently located branches: Oakdale, Turlock, Stockton, Patterson, Ripon, Escalon, Manteca, Tracy, Sacramento, Roseville, Lodi, two branches in Sonora, three branches in Modesto, and three branches in the Eastern Sierra division which includes Bridgeport, Mammoth Lakes, and Bishop.

For more information, call 1-866-844-7500 or visit www.ovcb.com.

This press release includes forward-looking statements about the corporation for which the corporation claims the protection of safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995.

Forward-looking statements are based on management's knowledge and belief as of today and include information concerning the corporation's possible or assumed future financial condition, and its results of operations and business. Forward-looking statements are subject to risks and uncertainties. A number of important factors could cause actual results to differ materially from those in the forward-looking statements. Those factors include fluctuations in interest rates, government policies and regulations (including monetary and fiscal policies), legislation, economic conditions, including increased energy costs in California, credit quality of borrowers, operational factors, and competition in the geographic and business areas in which the company conducts its operations. All forward-looking statements included in this press release are based on information available at the time of the release, and the Company assumes no obligation to update any forward-looking statement.

Oak Valley Bancorp

Financial Highlights (unaudited)

Selected Quarterly Operating Data:	4th Quarter	3rd Quarter	2nd Quarter	1st Quarter	4th Quarter
($ in thousands, except per share)	2025	2025	2025	2025	2024
Net interest income	$19,457	$19,197	$18,154	$17,807	$17,846
Provision for (reversal of) credit losses	865	(60)	-	-	-
Non-interest income	1,825	1,973	1,703	1,613	1,430
Non-interest expense	12,262	12,700	12,688	12,624	11,548
Net income before income taxes	8,155	8,530	7,169	6,796	7,728
Provision for income taxes	1,820	1,837	1,581	1,499	1,720
Net income	$6,335	$6,693	$5,588	$5,297	$6,008
Earnings per common share - basic	$0.77	$0.81	$0.68	$0.64	$0.73
Earnings per common share - diluted	$0.76	$0.81	$0.67	$0.64	$0.73
Dividends paid per common share	$-	$0.300	$-	$0.300	$-
Return on average common equity	12.32%	14.30%	12.21%	11.58%	12.86%
Return on average assets	1.25%	1.35%	1.18%	1.13%	1.25%
Net interest margin (1)	4.14%	4.16%	4.11%	4.09%	4.00%
Efficiency ratio (2)	55.94%	58.27%	61.95%	63.00%	58.09%
Capital - Period End
Book value per common share	$24.79	$23.63	$22.17	$21.89	$21.95
Credit Quality - Period End
Nonperforming assets / total assets	0.23%	0.00%	0.00%	0.00%	0.00%
Credit loss reserve / gross loans	1.08%	1.03%	1.03%	1.05%	1.04%
Balance Sheet - Period End (in thousands)
Total assets	$2,023,116	$1,995,416	$1,920,909	$1,924,365	$1,900,604
Gross loans	1,143,930	1,112,829	1,109,856	1,090,953	1,106,535
Nonperforming assets	4,587	-	-	-	-
Allowance for credit losses	12,381	11,420	11,430	11,448	11,460
Deposits	1,792,962	1,774,882	1,711,241	1,713,592	1,695,690
Common equity	207,975	198,280	185,805	183,520	183,436
Balance Sheet - Average (in thousands)
Average assets	$2,013,766	$1,961,374	$1,903,741	$1,903,585	$1,909,691
Average earning assets	1,914,907	1,876,588	1,818,430	1,814,338	1,819,649
Average equity	203,994	185,638	183,612	185,592	185,345
Non-Financial Data
Full-time equivalent staff	238	237	231	225	223
Number of banking offices	19	18	18	18	18
Common Shares outstanding
Period end	8,388,221	8,390,621	8,382,062	8,382,062	8,357,211
Period average - basic	8,249,256	8,246,666	8,245,147	8,231,844	8,224,504
Period average - diluted	8,304,597	8,299,039	8,285,299	8,278,301	8,278,427
Market Ratios
Stock Price	$30.06	$28.17	$27.24	$24.96	$29.25
Price/Earnings	9.87	8.75	10.02	9.56	10.09
Price/Book	1.21	1.19	1.23	1.14	1.33

This is a non-GAAP measure that is computed on a fully tax equivalent basis using a federal tax rate of 21%. The resulting adjustment to net interest income is $509 thousand, $501 thousand, $498 thousand, $497 thousand, and $484 thousand thousand for the three-months ended December 31, 2025, September 30, 2025, June 30, 2025, March 31, 2025, and December 31, 2024, respectively.
This is a non-GAAP measure that is computed on a fully tax equivalent basis using a federal tax rate of 21%, and a federal/state combined tax rate of 29.56%. The resulting adjustment to pre-tax income is $639 thoursand, $626 thousand, $624 thousand, $618 thousand, and $604 thousand for the three-months ended December 31, 2025, September 30, 2025, June 30, 2025, March 31, 2025, and December 31, 2024, respectively.

Profitability	YEAR ENDED DECEMBER 31,
($ in thousands, except per share)	2025	2024
Net interest income	$74,615	$70,034
Provision for (reversal of) credit losses	805	(1,620)
Non-interest income	7,114	6,555
Non-interest expense	50,274	46,017
Net income before income taxes	30,650	32,192
Provision for income taxes	6,737	7,244
Net income	$23,913	$24,948
Earnings per share - basic	$2.90	$3.04
Earnings per share - diluted	$2.88	$3.02
Dividends paid per share	$0.600	$0.450
Return on average equity	12.60%	14.39%
Return on average assets	1.23%	1.35%
Net interest margin (3)	4.13%	4.07%
Efficiency ratio (4)	59.68%	58.20%
Capital - Period End
Book value per share	$24.79	$21.95
Credit Quality - Period End
Nonperforming assets/ total assets	0.23%	0.00%
Credit loss reserve/ gross loans	1.08%	1.04%
Balance Sheet - Period End (in thousands)
Total assets	$2,023,116	$1,900,604
Gross loans	1,143,930	1,106,535
Nonperforming assets	4,587	-
Allowance for credit losses	12,381	11,460
Deposits	1,792,962	1,695,690
Stockholders' equity	207,975	183,436
Balance Sheet - Average (in thousands)
Average assets	$1,945,962	$1,853,315
Average earning assets	1,856,397	1,770,536
Average equity	189,748	173,335
Non-Financial Data
Full-time equivalent staff	238	223
Number of banking offices	19	18
Common Shares outstanding
Period end	8,388,221	8,357,211
Period average - basic	8,243,285	8,218,846
Period average - diluted	8,291,901	8,258,857
Market Ratios
Stock Price	$30.06	$29.25
Price/Earnings	10.36	9.64
Price/Book	1.21	1.33

This is a non-GAAP measure that is computed on a fully tax equivalent basis using a federal tax rate of 21%. The resulting adjustment to net interest income is $2.005 million and $2.036 million for the years ended December 31, 2025 and 2024, respectively.
This is a non-GAAP measure that is computed on a fully tax equivalent basis using a federal tax rate of 21%, and a federal/state combined tax rate of 29.56%. The resulting adjustment to pre-tax income is $2.507 million and $2.478 million for the years ended December 31, 2025 and 2024, respectively.

Contacts
Chris Courtney/Rick McCarty
(209) 848-2265 www.ovcb.com