Eastern Virginia Bankshares (NASDAQ:EVBS) today reported results of operations for the first three months of 2010 and announced a dividend declaration. Net income for the first quarter of 2010 was $1.3 million compared to $723 thousand in 2009, an increase of $611 thousand or 84.5%. This increase was driven by a $1.4 million increase in the net interest margin. Net income available to common shareholders for the quarter was $962 thousand or $0.16 per common share, assuming dilution, compared with $381 thousand or $0.06 per common share in the prior year first quarter. The difference between net income and net income available to common shareholders is the deduction for dividends and discount/ accretion on preferred stock. Highlights of the Company’s quarterly performance include:
Net interest income increased $1.4 million, or 19.1% compared to the same quarter in 2009 and $147 thousand, or 1.6%, compared to the fourth quarter of 2009 and was primarily driven by $1.7 million and $577 thousand decreases in funding cost for the respective periods.
Net interest margin increased to 3.71% from 3.17% for the same quarter in 2009 and from 3.54% for the fourth quarter of 2009.
Credit quality issues continue to significantly affect net income, increasing loan loss provision to $1.85 million, compared to $900 thousand in the same quarter in 2009 and compared to $1.7 million in the fourth quarter of 2009.
A BOLI gain of $604 thousand partially offset our increase in the provision expense.
Balance sheet changes resulted in a smaller securities portfolio and excess cash.
Decreased loan demand.
Noninterest income in the first quarter of 2010 increased $567 thousand, or 36.4%, driven by the BOLI gain. Service charges on deposits declined $72 thousand compared to 2009 and we had a loss on LLC investments of $14 thousand compared to a gain of $17 thousand in 2009. Debit and credit card fees increased $26 thousand, and there were no securities impairments in the quarter.