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Shares of Ohio Valley Banc Corp. (OVBC - Free Report) have lost 6.6% since the company reported its earnings for the quarter ended June 30, 2025. This compares unfavorably with the S&P 500 Index, which posted a marginal loss of 0.3% over the same time frame. The stock’s performance over the past month has also been underwhelming, declining 4.8% versus the S&P 500’s 2.1% advance.
OVBC’s Earnings Snapshot
In the second quarter of 2025, Ohio Valley Banc reported consolidated net income of $4.2 million, marking a 41.7% increase from $2.9 million in the year-ago quarter. Earnings per share (EPS) jumped 41.3% to $0.89 from $0.63 in the same period last year.
For the first half of 2025, net income surged 49.5% to $8.6 million. EPS stood at $1.83, up 51.2% from $1.21 in the prior-year period. These improvements were underpinned by a solid rise in net interest income, which climbed $2.6 million for the quarter and $4.5 million for the six-month period.
Segmentally, growth was concentrated in commercial real estate, commercial and industrial, and residential real estate lending, while consumer lending declined due to a strategic shift away from that segment.
Ohio Valley Banc’s Other Key Business Metrics
Net interest margin expanded notably to 4.17% in the second quarter from 3.74% a year earlier. For the first half of the year, the margin stood at 4.01%, up from 3.68%. This improvement was driven by a favorable shift in asset mix toward higher-yielding loans and securities, bolstered by participation in the Ohio Homebuyer Plus program. The yield on earning assets increased due to growth in securities and loan portfolios, while funding costs decreased as higher-cost certificates of deposit repriced at lower market rates. Notably, average earning assets for the six months ended June 30, 2025, grew by $122 million, reflecting a $99 million rise in securities and $60 million in loans.
The provision for credit losses totaled $1.1 million in the second quarter — up sharply from $0.2 million the prior year — mainly due to increased loan balances, higher modeled loss rates and modest net charge-offs. Asset quality remained stable, with non-performing loans at 0.45% of total loans compared with 0.50% a year ago. The allowance for credit losses increased to 0.99% of total loans from 0.91% in the prior-year period.
Non-interest income rose 5.4% in the quarter, led by a 4.6% increase in debit and credit card interchange fees. Other sources, including service charges and tax preparation fees, remained relatively stable.
On the expense side, non-interest expense edged up 1.7% year over year to $11 million from $10.9 million, primarily due to higher data processing and marketing expenses. Salaries and employee benefits remained largely flat, reflecting savings from a voluntary early retirement program initiated in 2024.
Operational efficiency in second-quarter 2025 improved meaningfully, as reflected in a decline in the efficiency ratio to 63.09% from 73.37% in the same period a year ago. This suggests stronger revenue generation relative to operating costs.
Ohio Valley Banc Corp. Price, Consensus and EPS Surprise
OVBC’s Management Commentary and Strategic Drivers
President and CEO Larry Miller attributed the earnings momentum to participation in the Ohio Homebuyer Plus Program and a sharpened focus on commercial and real estate lending. The company launched the "Sweet Home Ohio" deposit product, offering above-market rates to savers. In exchange, Ohio Valley Banc received $77 million in subsidized deposits from the Ohio Treasurer, which were deployed into securities to comply with public fund collateralization requirements. This strategic initiative materially contributed to the boost in interest-earning assets. Simultaneously, the reduction in funds held at the Federal Reserve by $29 million allowed redeployment into higher-yielding assets, supporting margin expansion.
Loan growth, particularly in commercial segments, offset a deliberate reduction in consumer lending. Lower funding costs, driven by increased use of low-cost NOW and money market deposits, further improved profitability.
Ohio Valley Banc’s Guidance
OVBC did not provide formal forward-looking guidance. However, management alluded to potential future increases in the warehouse line of credit tied to mortgage volume recovery. They also noted that modeled loss rates might continue to be influenced by macroeconomic indicators such as GDP and unemployment trends.
OVBC’s Other Developments
During the quarter, Ohio Valley Banc experienced significant loan growth of $58 million, reversing the $19 million decline seen in the first quarter, which had been caused by the wind-down of a $31 million warehouse line of credit to a mortgage lender. While the current balance of this facility is zero, management noted that it may be revived depending on future mortgage volumes and client needs. No acquisitions, divestitures, or major restructuring activities were disclosed for the period.
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OVBC Stock Dips Despite Q2 Earnings Uptick, Net Interest Margin Expands
Shares of Ohio Valley Banc Corp. (OVBC - Free Report) have lost 6.6% since the company reported its earnings for the quarter ended June 30, 2025. This compares unfavorably with the S&P 500 Index, which posted a marginal loss of 0.3% over the same time frame. The stock’s performance over the past month has also been underwhelming, declining 4.8% versus the S&P 500’s 2.1% advance.
OVBC’s Earnings Snapshot
In the second quarter of 2025, Ohio Valley Banc reported consolidated net income of $4.2 million, marking a 41.7% increase from $2.9 million in the year-ago quarter. Earnings per share (EPS) jumped 41.3% to $0.89 from $0.63 in the same period last year.
For the first half of 2025, net income surged 49.5% to $8.6 million. EPS stood at $1.83, up 51.2% from $1.21 in the prior-year period. These improvements were underpinned by a solid rise in net interest income, which climbed $2.6 million for the quarter and $4.5 million for the six-month period.
Segmentally, growth was concentrated in commercial real estate, commercial and industrial, and residential real estate lending, while consumer lending declined due to a strategic shift away from that segment.
Ohio Valley Banc’s Other Key Business Metrics
Net interest margin expanded notably to 4.17% in the second quarter from 3.74% a year earlier. For the first half of the year, the margin stood at 4.01%, up from 3.68%. This improvement was driven by a favorable shift in asset mix toward higher-yielding loans and securities, bolstered by participation in the Ohio Homebuyer Plus program. The yield on earning assets increased due to growth in securities and loan portfolios, while funding costs decreased as higher-cost certificates of deposit repriced at lower market rates. Notably, average earning assets for the six months ended June 30, 2025, grew by $122 million, reflecting a $99 million rise in securities and $60 million in loans.
The provision for credit losses totaled $1.1 million in the second quarter — up sharply from $0.2 million the prior year — mainly due to increased loan balances, higher modeled loss rates and modest net charge-offs. Asset quality remained stable, with non-performing loans at 0.45% of total loans compared with 0.50% a year ago. The allowance for credit losses increased to 0.99% of total loans from 0.91% in the prior-year period.
Non-interest income rose 5.4% in the quarter, led by a 4.6% increase in debit and credit card interchange fees. Other sources, including service charges and tax preparation fees, remained relatively stable.
On the expense side, non-interest expense edged up 1.7% year over year to $11 million from $10.9 million, primarily due to higher data processing and marketing expenses. Salaries and employee benefits remained largely flat, reflecting savings from a voluntary early retirement program initiated in 2024.
Operational efficiency in second-quarter 2025 improved meaningfully, as reflected in a decline in the efficiency ratio to 63.09% from 73.37% in the same period a year ago. This suggests stronger revenue generation relative to operating costs.
Ohio Valley Banc Corp. Price, Consensus and EPS Surprise
Ohio Valley Banc Corp. price-consensus-eps-surprise-chart | Ohio Valley Banc Corp. Quote
OVBC’s Management Commentary and Strategic Drivers
President and CEO Larry Miller attributed the earnings momentum to participation in the Ohio Homebuyer Plus Program and a sharpened focus on commercial and real estate lending. The company launched the "Sweet Home Ohio" deposit product, offering above-market rates to savers. In exchange, Ohio Valley Banc received $77 million in subsidized deposits from the Ohio Treasurer, which were deployed into securities to comply with public fund collateralization requirements. This strategic initiative materially contributed to the boost in interest-earning assets. Simultaneously, the reduction in funds held at the Federal Reserve by $29 million allowed redeployment into higher-yielding assets, supporting margin expansion.
Loan growth, particularly in commercial segments, offset a deliberate reduction in consumer lending. Lower funding costs, driven by increased use of low-cost NOW and money market deposits, further improved profitability.
Ohio Valley Banc’s Guidance
OVBC did not provide formal forward-looking guidance. However, management alluded to potential future increases in the warehouse line of credit tied to mortgage volume recovery. They also noted that modeled loss rates might continue to be influenced by macroeconomic indicators such as GDP and unemployment trends.
OVBC’s Other Developments
During the quarter, Ohio Valley Banc experienced significant loan growth of $58 million, reversing the $19 million decline seen in the first quarter, which had been caused by the wind-down of a $31 million warehouse line of credit to a mortgage lender. While the current balance of this facility is zero, management noted that it may be revived depending on future mortgage volumes and client needs. No acquisitions, divestitures, or major restructuring activities were disclosed for the period.