PVF Capital Corp. Announces Fiscal First Quarter Results
- Strong mortgage banking activities resulting in mortgage origination income of $3.7 million.
- Lower rate environment and increasing prepayment speeds result in impairment of $1.2 million in mortgage servicing rights.
- Continued improvement in net interest margin to 2.62%.
- Credit costs remain elevated with provision for loan losses of $2.8 million and loss on real estate owned of $412,000.
- Continued progress towards achieving regulatory targeted adversely classified assets ratio.
- Improving noninterest expense levels.
- Bank capital ratios remain strong.
SOLON, Ohio, Oct. 26, 2010 (GLOBE NEWSWIRE) -- PVF Capital Corp. (Nasdaq:PVFC), the parent company of Park View Federal Savings Bank, announced a net loss of $618,000 or $0.02 basic and diluted loss per share for the quarter ended September 30, 2010.
During the quarter, the Company experienced a significant increase in mortgage banking activities as a result of the elevated levels of refinancing activities from the drop in mortgage interest rates. The increased mortgage volume resulted in mortgage origination income of $3.7 million, an increase of $1.2 million over the linked quarter of June 30, 2010, and an increase of $2.8 million over the same period of the prior year. The elevated levels of refinance activity also resulted in an increase in the amortization of the mortgage servicing asset, resulting in a net servicing loss of $150,000 for the period, compared with net servicing revenue of $122,000 and $143,000 for the linked quarter and prior year quarter, respectively. The accelerated prepayment speeds also resulted in a decline in the estimated fair value of certain tranches of the Company's mortgage servicing rights resulting in the establishment of a valuation allowance of $1.2 million. However, the estimated value of the Company's entire mortgage servicing rights portfolio continues to exceed its carrying value.
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