North Valley Bancorp (NOVB, Financial) filed Quarterly Report for the period ended 2010-03-31.
North Valley Bancorp has a market cap of $17 million; its shares were traded at around $2.26 with and P/S ratio of 0.3. NOVB is in the portfolios of Jim Simons of Renaissance Technologies LLC.
The Company had a net loss of $312,000, or $0.04 per diluted share, for the three months ended March 31, 2010 compared to a net loss of $3,107,000, or $0.41 per diluted share, for the three months ended March 31, 2009. The decrease in net loss for the three months ended March 31, 2010 compared to the same period in 2009 was principally driven by a reduction in provision for credit losses to $1,000,000 for the first three month period ended March 31, 2010 compared to $7,000,000 for the same period in 2009. Net interest income decreased $766,000 for the three months ended March 31, 2010 compared to the same period in 2009, and noninterest income decreased $152,000 for the three months ended March 31, 2010 compared to the same period in 2009 offset by a decrease in noninterest expense of $316,000 for the three months ended March 31, 2010.
Net interest income is the difference between interest earned on loans and investments and interest paid on deposits and borrowings, and is the primary revenue source for the Company. Net interest margin is net interest income expressed as a percentage of average earning assets. These items have been adjusted to give effect to $85,000 and $86,000 in taxable-equivalent interest income on tax-free investments for the periods ended March 31, 2010 and 2009, respectively.
Net interest income for the three months ended March 31, 2010 was $7,427,000, a $767,000, or 9.4%, decrease from net interest income of $8,194,000 for the same period in 2009. Interest income decreased $1,545,000, or 13.4%, to $9,960,000 for the three month period ended March 31, 2010 due primarily to a decrease in average loans and leases. The Company also had $585,000 in foregone interest income for the loans placed on nonaccrual status during the three months ended March 31, 2010. The average loans outstanding decreased $89,327,000, or 13.1%, to $591,511,000. This lower loan volume decreased interest income by $1,402,000. The average yield earned on the loan portfolio decreased 37 basis points to 5.91% for the three months ended March 31, 2010. This decrease in yield reduced interest income by $518,000. The total decrease to interest income from the loan portfolio was $1,920,000. The average balance of the investment portfolio increased $60,850,000, or 68.2%, which accounted for a $581,000 increase in interest income and a decrease in average yield of the investment portfolio of 82 basis points reduced interest income by $229,000.
Interest expense for the three months ended March 31, 2010 decreased $778,000, or 23.5%, to $2,533,000 compared to the same period in 2009. The largest decrease to interest expense was in time deposit accounts which decreased $8,386,000 as the average rates paid on these accounts decreased 82 basis points to 2.28% and reduced interest expense by $561,000 while a decrease in the average balances of these accounts decreased interest expense by $65,000. The average rate paid on savings and money market accounts decreased 33 basis points to 0.73% for the three month period ended March 31, 2010 compared to 1.06% for the same period in 2009, resulting in a decrease to interest expense of $163,000. This decrease was offset partially by higher average balances in savings and money market accounts of $28,973,000, resulting in a $77,000 increase in interest expense.
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North Valley Bancorp has a market cap of $17 million; its shares were traded at around $2.26 with and P/S ratio of 0.3. NOVB is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
Goodwill. During the fourth quarter of 2009 the Company recorded a goodwill impairment charge of $15,187,000, reducing the balance of goodwill to zero. Goodwill represents the excess of the cost of an acquired entity over the net of the amounts assigned to assets acquired and liabilities assumed in transactions accounted for under the purchase method of accounting. The Company records impairment losses as charges to noninterest expense and adjustments to the carrying value of goodwill. Goodwill is tested at a reporting unit level annually and the Company engaged the assistance of an independent consulting firm since the end of 2008. The comparison of the fair value of the reporting unit to its carrying value and the decline in the Company s stock price and market capitalization indicated that potential impairment existed. As a result of this analysis, the Company determined that impairment had occurred and recorded an impairment charge of $15,187,000, the entire amount of its goodwill.The Company had a net loss of $312,000, or $0.04 per diluted share, for the three months ended March 31, 2010 compared to a net loss of $3,107,000, or $0.41 per diluted share, for the three months ended March 31, 2009. The decrease in net loss for the three months ended March 31, 2010 compared to the same period in 2009 was principally driven by a reduction in provision for credit losses to $1,000,000 for the first three month period ended March 31, 2010 compared to $7,000,000 for the same period in 2009. Net interest income decreased $766,000 for the three months ended March 31, 2010 compared to the same period in 2009, and noninterest income decreased $152,000 for the three months ended March 31, 2010 compared to the same period in 2009 offset by a decrease in noninterest expense of $316,000 for the three months ended March 31, 2010.
Net interest income is the difference between interest earned on loans and investments and interest paid on deposits and borrowings, and is the primary revenue source for the Company. Net interest margin is net interest income expressed as a percentage of average earning assets. These items have been adjusted to give effect to $85,000 and $86,000 in taxable-equivalent interest income on tax-free investments for the periods ended March 31, 2010 and 2009, respectively.
Net interest income for the three months ended March 31, 2010 was $7,427,000, a $767,000, or 9.4%, decrease from net interest income of $8,194,000 for the same period in 2009. Interest income decreased $1,545,000, or 13.4%, to $9,960,000 for the three month period ended March 31, 2010 due primarily to a decrease in average loans and leases. The Company also had $585,000 in foregone interest income for the loans placed on nonaccrual status during the three months ended March 31, 2010. The average loans outstanding decreased $89,327,000, or 13.1%, to $591,511,000. This lower loan volume decreased interest income by $1,402,000. The average yield earned on the loan portfolio decreased 37 basis points to 5.91% for the three months ended March 31, 2010. This decrease in yield reduced interest income by $518,000. The total decrease to interest income from the loan portfolio was $1,920,000. The average balance of the investment portfolio increased $60,850,000, or 68.2%, which accounted for a $581,000 increase in interest income and a decrease in average yield of the investment portfolio of 82 basis points reduced interest income by $229,000.
Interest expense for the three months ended March 31, 2010 decreased $778,000, or 23.5%, to $2,533,000 compared to the same period in 2009. The largest decrease to interest expense was in time deposit accounts which decreased $8,386,000 as the average rates paid on these accounts decreased 82 basis points to 2.28% and reduced interest expense by $561,000 while a decrease in the average balances of these accounts decreased interest expense by $65,000. The average rate paid on savings and money market accounts decreased 33 basis points to 0.73% for the three month period ended March 31, 2010 compared to 1.06% for the same period in 2009, resulting in a decrease to interest expense of $163,000. This decrease was offset partially by higher average balances in savings and money market accounts of $28,973,000, resulting in a $77,000 increase in interest expense.
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