ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Thursday, March 14, 1996 TAG: 9603140056
SECTION: BUSINESS PAGE: B-8 EDITION: METRO
SOURCE: MAG POFF STAFF WRITER
Valley Bank has what almost every banker dreams of - no charge offs for bad loans or delinquencies. Despite that, the bank reported a loss of $738,746 after its first year of operations.
The loss was expected and explained by the heavy impact of start-up costs, the Roanoke bank said in its first annual report, released Wednesday.
Valley Bank's 1995 loss, equal to 90 cents a share of common stock, reflected the result of 71/2 months of business. It opened May 15, 1995.
Combined with a loss during a period of organization in 1994, the bank had an accumulated deficit of $1 million at the end of 1995.
The results, according to the annual report, "are consistent with the projections contained in our original business plan and regulatory applications."
A. Wayne Lewis, senior vice president and chief financial officer, noted that the bank invested heavily in technology and other start-up costs before it could open and begin earning money.
Valley Bank reported assets of $24 million, compared to $600,000 at the start of the year. The report said it had attracted $16.1 million in deposits and had loans totaling $13.7 million by the end of last year, an 85 percent loans-to-deposits rate.
Bank President Guy W. Byrd Jr. said regulators saw the deposits as normal for a new bank, but the ability to attract loan business was unusually good. He said all of the borrowed funds were invested locally.
Although Valley Bank made a provision of $137,341 for loan losses, Byrd said the bank has experienced no charge offs or delinquencies. No loan payment is more than 30 days past due.
Byrd and Lewis attributed that record to their loan officers' familiarity with the local market. All were loan officers for other Roanoke banks before joining Valley Bank.
The shareholders proxy statement shows that the 15 directors and executive officers as a group owned 41.25 percent of Valley Bank's shares as of Feb. 28, compared to 45.6 percent at the end of 1994.
Byrd said the directors have continued to buy stock, but the bank now has more than 900 shareholders. Only Chairman George W. Logan and Director W. Jackson Burrows own more than 5 percent of the outstanding stock.
The company's second annual meeting will be held at 6 p.m. April 24 at Holiday Inn-Tanglewood. Last year's first annual meeting, held before the bank opened, attracted several hundred people.
LENGTH: Medium: 51 linesby CNB