UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 or ☐ TRANSITION REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________. Commission File Number: 001-38314 MVB Financial Corp. (Exact name of registrant as specified in its charter) West Virginia 20-0034461 (Sta ...

Financial Performance and Risks - The company's noninterest bearing deposits increased from 10.9% of total deposits as of December 31, 2017, to 47.9% as of December 31, 2022, largely due to its gaming initiative[160]. - Gaming deposits totaled $652.1 million as of December 31, 2022, down from $911.6 million as of December 31, 2021, with $536.9 million concentrated among the three largest clients[160]. - The Federal Reserve Board has significantly decreased benchmark interest rates to near zero in response to the COVID-19 pandemic, but is now reversing this policy due to inflation concerns, leading to rising market interest rates[159]. - The transition from LIBOR to SOFR as the primary interest rate benchmark is expected to create considerable costs and additional risks for the company[165]. - The company may experience adverse effects on its financial condition due to potential losses from credit risk associated with counterparties in the financial services industry[161]. - The company is facing significant volatility in cryptocurrency markets, which may materially impact financial statements and stock market price[171]. - The company is subject to liquidity risk, which could disrupt its ability to meet financial obligations if funding sources are restricted[184][185]. - Economic downturns may lead to deposit base outflows, limiting access to liquidity and increasing funding costs[186]. - The company’s ability to pay dividends is restricted by federal policies and regulations, and future dividend payments depend on various factors including earnings and capital requirements[217]. - The inability to generate profits and pay dividends could adversely affect the company's financial condition and results of operations[210]. Business Strategy and Growth - The company is focused on long-term growth through new business initiatives, including investments in FinTech and cryptocurrency, which present substantial risks and uncertainties[168]. - The company has increased its investments in securities and loan growth due to the rise in noninterest bearing deposits[160]. - The company is pursuing strategies to acquire and internally develop technologies to scale and diversify banking capabilities, with uncertain timing for profitability[172]. - The introduction of new lines of business may require significant investment and may not meet initial timetables or profitability targets due to external factors[173]. Competition and Market Position - The company faces significant competition from various financial institutions, which may adversely affect its market position and profitability[162]. - The trading volume of the company's common stock is lower than that of larger financial services companies, which may affect liquidity and marketability[212]. - The company is engaged in relationships with clients in the payments, digital savings, and gaming industries, which could be impacted by regulatory changes[169]. Regulatory and Compliance Risks - The merger with IFH is pending regulatory approvals, and its success will depend on realizing anticipated cost savings without adversely affecting revenues[177][178]. - Integration challenges post-merger may lead to loss of key employees and disrupt ongoing business operations, affecting the combined company's performance[180][181]. - The company is subject to extensive federal, state, and local taxes, which could adversely affect performance if tax laws change[204]. - The company must comply with capital adequacy guidelines imposed by the Federal Reserve Board and the FDIC, failure to meet these could compromise its status as a financial holding company[208]. - The company faces risks related to compliance with the Sarbanes-Oxley Act, and any material weaknesses in internal controls could lead to sanctions and loss of investor confidence[218]. Operational Risks - The company relies on external vendors for operations, and any failure in their performance could disrupt business and adversely impact financial condition[196]. - Environmental liability risks associated with lending activities could lead to significant remediation costs and affect property values[197]. - The accuracy of customer information is critical, as reliance on inaccurate data could materially impact financial condition and results of operations[198]. - Changes in accounting policies and estimates could materially affect how the company reports its financial condition and results of operations[221]. - The company’s financial condition may be negatively impacted by disruptions in securities markets, leading to potential impairments of its investment securities portfolio[220]. - The company is exposed to risks from inadequate or inaccurate analytical and forecasting models, which could result in unexpected losses or insufficient allowances for loan losses[225]. - The company’s stock price can be volatile, influenced by market fluctuations, economic conditions, and regulatory changes[215].

Financial Performance - Net income attributable to the parent for the three months ended September 30, 2022, was $2,718 thousand, a decrease of 77.0% from $11,828 thousand in the same period of 2021[16]. - Basic earnings per share (EPS) for the three months ended September 30, 2022, was $0.22, a decrease from $1.00 in the same period of 2021, reflecting a decline of 78.0%[16]. - The company reported a comprehensive loss of $7,839 thousand for the three months ended September 30, 2022, compared to a comprehensive income of $11,014 thousand in the same period of 2021[18]. - The company reported a net loss of $1,698,000 from Edge Ventures for the three months ended September 30, 2022, compared to a net loss of $1,677,000 in the same period of 2021, indicating a slight increase in losses[150]. - Total net income available to common shareholders for the three months ended September 30, 2022, was $2,718 thousand, compared to $11,828 thousand for the same period in 2021[145]. - Total net income available to common shareholders for the three months ended September 30, 2022, was $8,033,000, a decrease from $13,563,000 in the same period of 2021, reflecting a decline of 40.9%[150]. Asset and Liability Management - Total assets increased to $3,139,922 thousand as of September 30, 2022, up from $2,792,449 thousand at December 31, 2021, representing a growth of 12.4%[14]. - Total liabilities rose to $2,895,562 thousand as of September 30, 2022, compared to $2,517,146 thousand at December 31, 2021, marking an increase of 15.0%[14]. - The allowance for loan losses increased to $26,515 thousand as of September 30, 2022, from $18,266 thousand at December 31, 2021, indicating a higher reserve for potential loan defaults[14]. - The total loan portfolio amounted to $2,470,438 thousand, with non-accrual loans totaling $22,350 thousand[75]. - The total loans categorized as "Pass" rated were $2,386,206,000 as of September 30, 2022, compared to $1,770,237,000 at the end of 2021, showing a 34.6% increase[72]. Income and Expense Analysis - Net interest income for the three months ended September 30, 2022, was $29,846 thousand, a 56.2% increase compared to $19,096 thousand for the same period in 2021[15]. - Noninterest income decreased to $8,191 thousand for the three months ended September 30, 2022, down from $21,951 thousand in the same period of 2021, a decline of 62.7%[15]. - Total noninterest expenses for the three months ended September 30, 2022, were $29,965,000, an increase from $25,829,000 in the same period of 2021, reflecting a rise of 16.5%[150]. - The company reported a net amortization and accretion of investments of $2,020,000 in 2022, down from $3,011,000 in 2021[25]. - The total charge-offs for the nine months ended September 30, 2022, were $7,304 thousand, primarily related to the subprime consumer automobile loan portfolio[85]. Loan Performance and Risk Assessment - Provision for loan losses was $5,120 thousand for the three months ended September 30, 2022, compared to $380 thousand in the same period of 2021, indicating a significant increase in risk assessment[15]. - The total criticized loans (Special Mention, Substandard, and Doubtful) amounted to $78,232,000 as of September 30, 2022, compared to $63,864,000 at the end of 2021, marking a 22.4% increase[72]. - The average recorded investment in impaired loans for the three months ended September 30, 2022, was $23,711,000, compared to $17,819,000 for the same period in 2021, indicating a 33.1% increase[62]. - Troubled debt restructured loans totaled $12.2 million as of September 30, 2022, with accruing loans representing 16% of total impaired loans[88]. - The allowance for loan losses (ALL) balance increased to $26,515 thousand as of September 30, 2022, from $18,266 thousand at December 31, 2021[85]. Market and Economic Conditions - Future outlook remains cautious amid market fluctuations and economic uncertainties[21]. - The impact of the COVID-19 pandemic continues to pose uncertainties for future operating results[40]. - The Federal Reserve raised its key interest rate to a range of 3.00% to 3.25% as of September 30, 2022, impacting the bank's interest income strategy[183]. - Management identified additional qualitative factors that may affect estimated credit losses, including lending policies and economic conditions[80]. - The company expects to enhance core deposits and fee income through the expansion of treasury services for Fintech and emerging technology companies[159]. Capital and Equity Management - Total stockholders' equity as of March 31, 2022, was $263.862 million, a decrease from $275.303 million at the end of 2021, representing a decline of about 4.2%[20]. - Tangible book value per common share decreased to $19.38 as of September 30, 2022, from $21.64 in 2021, a decline of 10.5%[179]. - The company completed the acquisition of 37.5% equity interest in Warp Speed Holdings for $38.4 million in cash and shares valued at $9.6 million[154][165]. - A merger agreement was entered into with Integrated Financial Holdings, Inc., where IFH shareholders will receive 1.21 shares of MVB common stock for each share of IFH common stock[153][167]. - The balance of recurring Level III assets, consisting solely of municipal securities, was $35,129,000 as of September 30, 2022, down from $41,763,000 at December 31, 2021[135].

FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 MVB Financial Corp. (Exact name of registrant as specified in its charter) West Virginia 20-0034461 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 301 Virginia Avenue, Fairmont, WV 26554 (Address of principal executive offices) (Zi ...

Financial Performance - Net income attributable to the parent for Q1 2022 was $2,864 thousand, a decrease of 64.5% from $8,085 thousand in Q1 2021[15]. - Net income for Q1 2022 was $2.671 million, a decrease of 66.8% compared to $8.058 million in Q1 2021[20]. - The company reported a comprehensive loss of $10,692 thousand for Q1 2022, compared to a comprehensive income of $3,967 thousand in Q1 2021[16]. - Basic earnings per share (EPS) for Q1 2022 was $0.24, down 65.7% from $0.70 in Q1 2021; diluted EPS was $0.22, down 66.7% from $0.66[137]. - Return on average assets decreased to 0.4% for the three months ended March 31, 2022, down from 1.3% in the same period in 2021, attributed to a $5.2 million decrease in earnings[180]. - Return on average stockholders' equity decreased to 4.2% for the three months ended March 31, 2022, compared to 13.6% in the same period in 2021, due to a $5.2 million decrease in earnings[181]. Asset and Deposit Growth - Total assets increased to $2,893,464 thousand as of March 31, 2022, up from $2,792,449 thousand at December 31, 2021, representing a growth of 3.6%[14]. - Total deposits rose to $2,509,079 thousand as of March 31, 2022, compared to $2,377,605 thousand at December 31, 2021, marking an increase of 5.5%[14]. - Noninterest-bearing demand deposits rose to $1,308,998 thousand as of March 31, 2022, compared to $1,120,433 thousand at December 31, 2021, marking an increase of about 16.8%[102]. - Fintech deposits increased from $1.14 billion at December 31, 2021, to $1.25 billion as of March 31, 2022, driven by growth in gaming deposits, which rose to $970.4 million from $911.6 million[191]. Loan Performance - Total loans as of March 31, 2022, amounted to $1,882 billion, an increase from $1.661 billion at March 31, 2021[79]. - The total commercial loans stood at $1,481,407 thousand as of March 31, 2022, slightly up from $1,480,527 thousand at the end of 2021[46]. - The total past due loans as of March 31, 2022, amounted to $10.704 million, with $5.887 million classified as 90+ days past due[69]. - Nonperforming loans increased to $18,048 thousand in Q1 2022, compared to $11,577 thousand in Q1 2021, representing a rise in nonperforming loans to total loans receivable ratio to 1.0%[158]. - The total impaired loans as of March 31, 2022, were $22,526 thousand, compared to $22,455 thousand as of December 31, 2021, showing a slight increase[55]. Income and Expense Analysis - Net interest income for the three months ended March 31, 2022, was $21,848 thousand, an increase of 24.5% compared to $17,505 thousand for the same period in 2021[15]. - Total noninterest income for Q1 2022 was $11,870 thousand, a decrease of 4.7% from $12,458 thousand in Q1 2021[15]. - Noninterest expenses increased to $28,862 thousand in Q1 2022, up 50.9% from $19,118 thousand in Q1 2021[15]. - The efficiency ratio worsened to 85.6% in Q1 2022 from 63.8% in Q1 2021[158]. Loan Loss Provisions - The provision for loan losses was $1,280 thousand for Q1 2022, compared to $618 thousand in Q1 2021, indicating a significant increase of 106.5%[15]. - The allowance for loan losses increased to $18,808 thousand as of March 31, 2022, from $18,266 thousand at December 31, 2021, indicating a rise of 2.9%[14]. - The allowance for loan losses (ALL) balance at March 31, 2022, was $18.194 million, down from $17.603 million at December 31, 2021[78]. Investment and Securities - As of March 31, 2022, the total amortized cost of investment securities available-for-sale was $413.3 million, with a fair value of $395.3 million, reflecting an unrealized loss of $19.8 million[40]. - The fair value of available-for-sale investment securities was $395,301,000, with $355,633,000 classified as Level II and $39,668,000 as Level III[127]. - The company does not expect to sustain any material realized losses from the current decline in fair value of securities, which are considered temporarily impaired[43]. Capital and Equity - The company’s total stockholders' equity at the end of Q1 2022 was $263.862 million, a decrease from $275.303 million at the end of Q1 2021[20]. - Stockholders' equity decreased by $11.4 million to $263.9 million during the three months ended March 31, 2022, primarily due to a $13.6 million comprehensive loss[194]. - The equity to assets ratio declined from 9.8% at December 31, 2021, to 9.1% at March 31, 2022, as assets grew by $101.0 million[195]. Operational Insights - The company is expanding its treasury services to support financial and emerging technology companies, enhancing core deposits and fee income strategies[146]. - The company continues to invest in infrastructure to support future growth, focusing on margin improvement and operating efficiency[146]. - The Bank has an effective shelf registration covering $75 million of debt and equity securities available for issuance[202].

Financial Performance and Risks - The company had $6.3 million in goodwill and other intangible assets as of December 31, 2021, which may require future write-downs if cash flows decline significantly [164]. - Continued elevated levels of inflation could adversely impact the company's business, potentially leading to increased interest expenses and volatility in loan demand [159]. - The company faces substantial competition from various financial institutions, which may affect its growth and profitability [161]. - The company has significant exposure to credit risk due to interrelated relationships with other financial institutions, which could adversely affect its financial condition [160]. - The company is subject to liquidity risk, which could disrupt its ability to meet financial obligations [179]. - Limited availability of borrowings from the FHLB system could negatively impact earnings and liquidity [181]. - The inability to generate profits and pay dividends could adversely affect the company's financial condition and results of operations [207]. Regulatory and Compliance Challenges - The company is subject to extensive federal and state regulations that significantly affect its lending practices, capital structure, and growth strategies [202]. - The company faces risks related to compliance with various regulations, which could result in enforcement actions and reputational damage [202]. - The transition away from LIBOR may create considerable costs and additional risks, impacting the company's financial instruments indexed to LIBOR [165]. - The company must effectively manage the transition from LIBOR to alternative rates to avoid reputational damage and financial losses [169]. - The company is expanding its banking-as-a-service business, which may face heightened regulatory scrutiny regarding consumer compliance [173]. Market and Economic Factors - The Federal Reserve may begin to increase interest rates, which could lead to unintended volatility in the financial system and impact the company's operations [158]. - The company may face competitive pressures to increase interest rates on deposits to retain its gaming customers, potentially increasing funding costs [163]. - Changes in tax laws may adversely affect performance and necessitate adjustments in accounting practices [201]. Strategic Initiatives and Investments - The company has undertaken various new business initiatives, which involve substantial risks and uncertainties, particularly in underdeveloped markets [170]. - The company is involved in innovative strategies to provide independent banking to corporate clients across the U.S., leveraging investments in Fintech, which may increase operational and compliance risks [171]. - Investments in Fintech companies have significantly impacted the company's results of operations and are expected to continue doing so in the future [175]. - Earnings from Fintech investments can be volatile, and any deterioration in their value could result in losses [176]. - Significant costs are anticipated for acquiring and developing new technologies to scale and diversify banking capabilities, with uncertain timing for profitability [172]. - Potential acquisitions may disrupt business and dilute stockholder value, with risks including payment of premiums and failure to realize expected benefits [178]. Operational and Internal Control Risks - Cybersecurity risks, including breaches and attacks, could adversely affect operations and customer trust [187]. - The company's risk management processes rely on analytical and forecasting models, which may prove inadequate, leading to unexpected losses or insufficient allowances for loan losses [224][225]. - The company has no material weaknesses in internal control over financial reporting as of December 31, 2021, but future weaknesses could lead to sanctions and loss of investor confidence [217]. - Changes in accounting standards and policies could materially impact how the company reports its financial condition and results of operations [223]. Stock Performance and Dividends - The trading volume of the company's common stock is lower than that of larger financial services companies, which may affect liquidity and marketability [209]. - The company's stock price can be volatile, influenced by factors such as quarterly results, analyst recommendations, and general market conditions [212][213]. - The company's ability to pay dividends is restricted by federal policies and regulations, and any future dividend payments will depend on various factors including future earnings and regulatory restrictions [214][215].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2021 or ☐ TRANSITION REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________. Commission File Number: 001-38314 MVB Financial Corp. (Exact name of registrant as specified in its charter) West Virginia 20-0034461 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Exact name of registrant as specified in its charter) West Virginia 20-0034461 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 301 Virginia Avenue, Fairmont, WV 26554 (Address of principal executive offices) (Zip Code) (304) 363-4800 (Registrant's telephone number, including area code) Not Applicable FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURI ...

Financial Performance - Net income attributable to the parent for Q1 2021 was $8,085 thousand, compared to $1,048 thousand in Q1 2020, marking a significant increase of 671.5%[13]. - Comprehensive income for Q1 2021 was $3,967 thousand, compared to $131 thousand in Q1 2020, showing a substantial increase[14]. - Net income for the three months ended March 31, 2021, was $8,058,000, compared to $1,048,000 for the same period in 2020, representing a significant increase[16]. - The Company earned $8.1 million in Q1 2021, a significant increase from $1.0 million in Q1 2020, resulting in a return on average assets of 1.3% and a return on average equity of 13.6%[144]. - Basic earnings per share (EPS) for Q1 2021 was $0.70, up from $0.08 in Q1 2020, indicating strong earnings growth[132]. Asset and Deposit Growth - Total assets increased to $2,646,089 thousand as of March 31, 2021, up from $2,331,476 thousand as of December 31, 2020, representing a growth of 13.5%[12]. - Total deposits rose to $2,216,553 thousand as of March 31, 2021, up from $1,982,389 thousand as of December 31, 2020, reflecting an increase of 11.8%[12]. - Total deposits increased by $234,164,000 in Q1 2021, compared to $332,734,000 in Q1 2020, indicating strong customer confidence[16]. - Total cash and cash equivalents at the end of the period increased to $339,616,000 from $88,874,000 year-over-year[16]. - Total deposits amounted to $2,216,553 thousand as of March 31, 2021, with an estimated fair value of $2,196,951 thousand[110]. Income and Expense Analysis - Net interest income for Q1 2021 was $17,505 thousand, compared to $16,171 thousand in Q1 2020, an increase of 8.2%[13]. - Noninterest income for Q1 2021 totaled $12,458 thousand, up from $10,850 thousand in Q1 2020, representing a growth of 14.8%[13]. - Total noninterest expenses decreased to $19,118 thousand in Q1 2021 from $24,656 thousand in Q1 2020, a reduction of 22.5%[13]. - Noninterest expenses decreased to $19.1 million for the three months ended March 31, 2021, down from $24.7 million in the same period in 2020, with personnel costs comprising approximately 62% of total noninterest expenses[175]. - The efficiency ratio improved to 63.8% in Q1 2021 from 91.3% in Q1 2020, indicating better cost management[154]. Loan and Credit Quality - The allowance for loan losses was $26,214 thousand as of March 31, 2021, compared to $25,844 thousand as of December 31, 2020, indicating a slight increase of 1.4%[12]. - The total loans amounted to $1.696 billion, up from $1.455 billion as of December 31, 2020, reflecting a growth of 16.6%[42]. - The total impaired loans as of March 31, 2021, were $13.111 million, compared to $15.394 million as of December 31, 2020, indicating a decrease of 14.8%[51]. - The provision for loan losses decreased to $0.6 million for the three months ended March 31, 2021, compared to $1.1 million for the same period in 2020, reflecting changes in charge-offs and historical loss rates[167]. - The allowance for loan losses (ALL) is based on management's evaluation of risk characteristics and credit quality, with total collectively evaluated impaired loans at $2.0 million as of March 31, 2021[65]. Investment and Securities - The total amortized cost of investment securities available-for-sale was $420.69 million, with a fair value of $423.12 million as of December 31, 2020[33]. - The Company reported unrealized losses of $3.3 million on securities as of March 31, 2021, but maintains the ability to hold these securities until principal recovery[36]. - The fair value of municipal securities held by the Company was $209.734 million as of March 31, 2021, with unrealized losses of $1.008 million[32]. - The Company recognized unrealized holding gains on equity securities of $0.5 million for the three months ended March 31, 2021, compared to immaterial gains in the same period of 2020[39]. - The company reported realized and unrealized gains of $19,000 in earnings related to municipal securities for the period ending March 31, 2021[123]. Capital and Equity - The total equity attributable to the parent decreased slightly to $236,210 thousand as of March 31, 2021, from $239,483 thousand as of December 31, 2020, a decline of 1.0%[12]. - Stockholders' equity decreased by approximately $3.3 million to $236.7 million during the quarter ended March 31, 2021, with a dividend payout ratio dropping from 115.2% to 14.3%[195]. - The Company redeemed all outstanding shares of its preferred stock in January 2021, with a redemption price of $10,000 per share plus unpaid dividends[108]. - The Company has an effective shelf registration covering $75 million of debt and equity securities available for issuance[201]. - The Bank's CBLR at March 31, 2021 was 11.3%, exceeding the well-capitalized standard of 8.5%[198]. Operational Developments - The company acquired an 80% interest in Flexia, which provides a reloadable account combining debit and casino gaming accounts, enhancing its fintech capabilities[21]. - The Bank acquired an 80% interest in Flexia Payments, LLC for approximately $2.5 million in February 2021[138]. - The Bank entered into a Stock Purchase Agreement to acquire a majority interest in Trabian Technology, Inc. in April 2021[139]. - The Company originated 634 PPP loans totaling $88.5 million and an additional $102.1 million through a partnership with a Fintech company as of March 31, 2021[84]. - The Company is involved in various legal actions, but management believes the outcomes will not significantly affect the consolidated financial statements[210].

[Part I](index=5&type=section&id=PART%20I) [Business](index=5&type=section&id=Item%201.%20Business) MVB Financial Corp. operates through MVB Bank, Inc., focusing on CoRe banking, mortgage, and strategic Fintech services, with significant M&A activity and regulatory oversight [Corporate and Business Overview](index=7&type=section&id=Corporate%20and%20Business%20Overview) MVB Financial Corp. is a financial holding company focused on CoRe banking and Fintech, operating through three segments and actively engaging in M&A - **MVB Financial Corp.** is a financial holding company operating primarily through **MVB Bank, Inc.**, focusing on **Commercial and Retail (CoRe) banking** with a strategic emphasis on **Financial Technology (Fintech)** services for corporate clients nationwide[17](index=17&type=chunk)[18](index=18&type=chunk) - Significant M&A activity includes acquiring **Chartwell** (compliance services), divesting **four bank branches**, forming a mortgage joint venture (**ICM**), and acquiring assets from **The First State Bank** via an FDIC receivership[19](index=19&type=chunk) - Operations are structured into **three reportable segments**: **CoRe banking** (including **Fintech division**, **Chartwell**, and **Paladin Fraud**), **mortgage banking** (primarily from **ICM** equity investment), and the **financial holding company**[24](index=24&type=chunk)[25](index=25&type=chunk) [Lending Activities](index=9&type=section&id=Lending%20Activities) The company's loan portfolio is predominantly commercial, with residential loans also present, and both types are subject to specific risk management practices Loan Portfolio Composition as of December 31, 2020 | Loan Type | Amount (approx.) | % of Total Loans | | :--- | :--- | :--- | | Commercial Loans | $1.16 billion | 80.0% | | Residential Loans | $288.0 million | 19.8% | - Commercial lending poses **higher risk** due to reliance on business cash flow, necessitating **annual reviews** and specific evaluations for **COVID-19 impacts**[27](index=27&type=chunk)[28](index=28&type=chunk)[29](index=29&type=chunk) - Residential real estate loans generally require an **80%** loan-to-value ratio or private mortgage insurance, while construction financing is deemed **higher risk**, with residential construction loans to individuals totaling approximately **$119.4 million** at year-end[31](index=31&type=chunk)[32](index=32&type=chunk) [Human Capital and Competition](index=10&type=section&id=Human%20Capital%20and%20Competition) The company manages its 344 employees through culture and training initiatives while navigating intense competition from traditional and Fintech banks - As of December 31, 2020, the company had **344 employees**, with human capital initiatives focused on fostering a **strong culture**, investing in **training**, and ensuring **employee safety** during the **COVID-19 pandemic**, leading to over **85%** of team members transitioning to remote work[35](index=35&type=chunk)[36](index=36&type=chunk)[38](index=38&type=chunk) - The company faces **significant competition** in lending and deposits from **traditional banks**, **credit unions**, and **Fintech-focused banks/neobanks**, employing a strategy centered on **customer relationships** and a **needs-based selling approach** rather than solely on interest rates[33](index=33&type=chunk)[34](index=34&type=chunk) [Supervision and Regulation](index=11&type=section&id=Supervision%20and%20Regulation) The company is extensively regulated by federal and state authorities, adhering to frameworks like Dodd-Frank and maintaining strong capital ratios - The company and its subsidiaries are subject to **extensive regulation** by federal and state authorities, including the **Federal Reserve Board**, **FDIC**, and **SEC**, primarily for the **protection of depositors and the financial system**[43](index=43&type=chunk)[50](index=50&type=chunk)[51](index=51&type=chunk) - Major regulatory frameworks include the **Dodd-Frank Act** and the **Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA)**, which modified certain Dodd-Frank provisions for smaller banks[46](index=46&type=chunk)[47](index=47&type=chunk) - As a financial holding company, MVB must ensure its depository institution subsidiaries are **well capitalized** and **well managed**, and it believes it qualifies for the Federal Reserve's **Small Bank Holding Company Policy Statement**, **exempting it from consolidated capital requirements**[54](index=54&type=chunk)[58](index=58&type=chunk) - The Bank is subject to **minimum capital ratios** under the Capital Rules, including a **capital conservation buffer**, with effective minimums of **7% for CET1**, **8.5% for Tier 1**, and **10.5% for Total capital** to risk-weighted assets as of January 1, 2019[82](index=82&type=chunk)[83](index=83&type=chunk) [Risk Factors](index=21&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks from economic conditions, the COVID-19 pandemic, PPP exposure, non-residential loan concentration, Fintech investments, regulatory changes, cybersecurity, and stock volatility - The full impact of the **COVID-19 pandemic** remains unknown and could **materially affect** the company's business, financial condition, and results of operations, including negative impacts on **interest income** and **credit quality** through loan deferral programs[123](index=123&type=chunk)[124](index=124&type=chunk)[125](index=125&type=chunk) - Participation in the SBA's **Paycheck Protection Program (PPP)** exposes the company to **litigation risk** regarding loan processing and **credit risk** if the SBA denies its guarantee due to origination deficiencies[141](index=141&type=chunk)[142](index=142&type=chunk)[144](index=144&type=chunk) - Approximately **80%** of the loan portfolio comprises **non-residential real estate loans**, which carry **greater risk of non-payment and and loss** compared to residential mortgages[145](index=145&type=chunk) - Strategic **Fintech** initiatives, serving clients in **payments, cryptocurrency, and gaming industries**, introduce **increased business, reputational, operational, and regulatory risks**, with gaming deposits representing approximately **18% of total deposits** as of December 31, 2020[158](index=158&type=chunk)[159](index=159&type=chunk)[160](index=160&type=chunk) - Reliance on information systems exposes the company to **cybersecurity risks**, where a breach could **damage its reputation**, lead to a **loss of business**, and result in **litigation and financial liability**[170](index=170&type=chunk)[171](index=171&type=chunk)[174](index=174&type=chunk) [Unresolved Staff Comments](index=33&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the SEC - None [Properties](index=33&type=section&id=Item%202.%20Properties) The company owns its main office and 7 of 13 full-service branches, with 6 leased, and underwent branch closures and sales in 2020 - The company owns its **main office** and **7 of its 13 full-service banking branches**, with the remaining **6 branches being leased**[207](index=207&type=chunk) - In 2020, the company **closed one branch** in Morgantown, WV, and **sold four branches** in Berkeley and Jefferson Counties, WV[208](index=208&type=chunk)[209](index=209&type=chunk) [Legal Proceedings](index=34&type=section&id=Item%203.%20Legal%20Proceedings) The company reports no awareness of any material pending legal proceedings involving itself or its subsidiaries - The company reports that it is not aware of any material pending legal proceedings[210](index=210&type=chunk) [Mine Safety Disclosures](index=34&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section is not applicable to the company - Not applicable [Part II](index=35&type=section&id=PART%20II) [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=35&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity,%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) MVB Financial Corp.'s common stock trades on Nasdaq under 'MVBF', with 920 stockholders, paid $0.36 dividends in 2020, and repurchased 668,390 shares in Q4 2020 - The company's common stock trades on the **Nasdaq Capital Market** under the symbol "**MVBF**", with approximately **920 stockholders** of record as of March 8, 2021[214](index=214&type=chunk) Dividends Per Share | Year | Dividend per Share | | :--- | :--- | | 2020 | $0.36 | | 2019 | $0.195 | | 2018 | $0.11 | Share Repurchases (Q4 2020) | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | Oct 2020 | 130,400 | $17.00 | | Nov 2020 | 1,500 | $16.37 | | Dec 2020 | 536,490 | $20.25 | | **Total** | **668,390** | | [Selected Financial Data](index=37&type=section&id=Item%206.%20Selected%20Financial%20Data) In 2020, total assets grew to $2.33 billion and net income to $37.0 million, driven by deposit growth, though nonperforming loans increased to 0.9% Selected Financial Data (2019 vs 2020) | (Dollars in thousands, except per share data) | 2020 | 2019 | | :--- | :--- | :--- | | **Balance Sheet Data:** | | | | Total Assets | $2,331,476 | $1,944,114 | | Loans receivable, net | $1,427,900 | $1,362,766 | | Deposits | $1,982,389 | $1,265,042 | | Stockholders' equity | $239,483 | $211,936 | | **Income Statement Data:** | | | | Net interest income | $68,826 | $59,400 | | Provision for loan loss | $16,579 | $1,789 | | Noninterest income | $91,837 | $64,604 | | Net income available to common shareholders | $36,950 | $26,512 | | **Per Share Data:** | | | | Earnings per share - basic | $3.13 | $2.26 | | Book value | $20.14 | $17.13 | | **Asset Quality Ratios:** | | | | Nonperforming loans to total loans | 0.9% | 0.4% | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=39&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In 2020, MVB's assets grew to $2.33 billion and net income to $37.4 million, driven by Fintech deposits and ICM, while increasing loan loss provisions due to COVID-19 and maintaining strong capital [Executive Summary and COVID-19 Impact](index=41&type=section&id=Executive%20Summary%20and%20COVID-19%20Impact) The company achieved strong financial results in 2020, actively participated in PPP, and implemented loan modifications in response to COVID-19 Key Financial Results (2020 vs. 2019) | Metric | 2020 | 2019 | | :--- | :--- | :--- | | Total Assets | $2.33 billion | $1.94 billion | | Deposits | $1.98 billion | $1.27 billion | | Net Income | $37.4 million | $27.0 million | | Diluted EPS | $3.06 | $2.20 | | Return on Average Assets | 1.7% | 1.4% | | Return on Average Equity | 16.7% | 13.6% | - The company actively participated in the **Paycheck Protection Program (PPP)**, originating **455 loans** with original balances of **$92.8 million**, with **$82.0 million** in PPP loans outstanding at year-end[234](index=234&type=chunk) - In response to the pandemic, the company approved **loan modifications** for commercial loans totaling **$34.7 million** and mortgage loans totaling **$13.5 million** as of December 31, 2020[234](index=234&type=chunk) [Net Interest Income and Margin](index=42&type=section&id=Net%20Interest%20Income%20and%20Margin) Net interest income increased by $9.4 million to $68.8 million in 2020, driven by lower cost of funds, resulting in a slightly improved net interest margin - Net interest income **increased by $9.4 million (15.9%)** to **$68.8 million** in 2020, primarily due to the **cost of interest-bearing liabilities (down 83 bps to 0.85%)** decreasing more than the **yield on earning assets (down 70 bps to 4.17%)**[245](index=245&type=chunk)[251](index=251&type=chunk) - The tax-equivalent net interest margin (NIM) slightly increased to **3.57%** in 2020 from **3.53%** in 2019, with the net interest spread widening to **3.32%** from **3.19%**, aided by a **$243.9 million** increase in average noninterest-bearing demand deposits[242](index=242&type=chunk)[243](index=243&type=chunk) [Provision for Loan Losses](index=46&type=section&id=Provision%20for%20Loan%20Losses) The provision for loan losses significantly increased to $16.6 million in 2020, primarily due to qualitative adjustments and risk grade changes in response to COVID-19 Provision for Loan Losses | Year | Provision Amount | | :--- | :--- | | 2020 | $16.6 million | | 2019 | $1.8 million | | 2018 | $2.4 million | - The **substantial increase** in the 2020 provision was primarily driven by qualitative adjustment factor changes in response to the **COVID-19 pandemic**, with **$12.8 million** from framework enhancements and **$3.8 million** from risk grade adjustments for significant loans[254](index=254&type=chunk)[256](index=256&type=chunk)[257](index=257&type=chunk) [Noninterest Income and Expense](index=47&type=section&id=Noninterest%20Income%20and%20Expense) Noninterest income grew by $27.2 million to $91.8 million, driven by ICM and M&A gains, while noninterest expense rose by $9.9 million to $97.1 million due to salaries and professional fees - Noninterest income **increased by $27.2 million** to **$91.8 million** in 2020, primarily driven by **$24.2 million** from the **ICM equity method investment**, **$17.6 million** in gains from **acquisition/divestiture activity**, and a **$3.5 million** increase in **compliance consulting income**[259](index=259&type=chunk)[260](index=260&type=chunk)[261](index=261&type=chunk) - Noninterest expense **increased by $9.9 million** to **$97.1 million** in 2020, mainly due to a **$5.5 million** rise in **salaries and benefits** from team build-outs and acquisitions, and a **$3.5 million** increase in **professional fees** related to M&A transactions[265](index=265&type=chunk)[266](index=266&type=chunk) [Financial Condition Analysis](index=49&type=section&id=Financial%20Condition%20Analysis) Total loans grew to $1.45 billion, driven by PPP, while asset quality indicators showed some deterioration; deposits surged to $1.98 billion, largely from Fintech, and capital ratios remained strong - Total loans **grew by $79.2 million** to **$1.45 billion**, with commercial and non-residential real estate loans forming **79.9%** of the portfolio, primarily driven by **$82.0 million** in outstanding **PPP loans**[279](index=279&type=chunk)[280](index=280&type=chunk) Asset Quality Indicators (as of Dec 31) | Metric | 2020 | 2019 | | :--- | :--- | :--- | | Non-performing assets | $19.4 million | $6.5 million | | Allowance for loan losses | $25.8 million | $11.8 million | | Non-performing assets to total assets | 0.8% | 0.3% | | Allowance for loan losses to non-performing loans | 188.5% | 229.8% | - Total deposits **increased by $717.3 million** to **$1.98 billion**, with **noninterest-bearing deposits** growing to **$715.8 million (36.1% of total deposits)** from **$278.5 million (22.0% of total deposits)** in 2019, primarily driven by **Fintech deposits**[302](index=302&type=chunk)[304](index=304&type=chunk) - The Bank's capital ratios remained **strong** and above **well-capitalized standards**, with a **Total risk-based capital ratio of 15.8%** and a **Tier 1 leverage ratio of 11.0%** at December 31, 2020[310](index=310&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=55&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk, managed by ALCO, showing asset sensitivity with NII benefiting from rising rates, alongside heightened credit risk due to COVID-19 - The company's primary market risk is **interest rate fluctuation**, managed by its **Asset and Liability Committee (ALCO)** using **simulation analysis** to model impacts on **net interest income (NII)** and **economic value of equity (EVE)**[328](index=328&type=chunk)[330](index=330&type=chunk)[333](index=333&type=chunk) Estimated Change in Net Interest Income from Rate Shocks (as of Dec 31, 2020) | Change in Interest Rates (bp) | % Change in NII | | :--- | :--- | | +400 | 42.7% | | +200 | 19.3% | | +100 | 9.6% | | -100 | (6.6)% | | -200 | (9.6)% | - As of December 31, 2020, the company is in an **asset-sensitive position**, generally **more favorable in a rising rate environment**, marking a shift from its 2019 exposure to falling rates[337](index=337&type=chunk)[338](index=338&type=chunk) [Financial Statements and Supplementary Data](index=58&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited consolidated financial statements for 2020, with an unqualified opinion from Dixon Hughes Goodman LLP, including balance sheets, income statements, and detailed notes [Consolidated Financial Statements](index=62&type=section&id=Consolidated%20Financial%20Statements) Dixon Hughes Goodman LLP issued an unqualified opinion on the 2020 consolidated financial statements, which show total assets of $2.33 billion and net income of $37.4 million - The independent auditor, **Dixon Hughes Goodman LLP**, issued an **unqualified opinion** on the **consolidated financial statements** and the company's **internal control over financial reporting** as of December 31, 2020[354](index=354&type=chunk)[367](index=367&type=chunk) Consolidated Balance Sheet Highlights (as of Dec 31) | (Dollars in thousands) | 2020 | 2019 | | :--- | :--- | :--- | | Total Assets | $2,331,476 | $1,944,114 | | Loans receivable, net | $1,427,900 | $1,362,766 | | Goodwill | $2,350 | $19,630 | | Total Deposits | $1,982,389 | $1,265,042 | | Total Stockholders' Equity | $239,483 | $211,936 | Consolidated Income Statement Highlights (Year Ended Dec 31) | (Dollars in thousands) | 2020 | 2019 | | :--- | :--- | :--- | | Net Interest Income | $68,826 | $59,400 | | Provision for loan losses | $16,579 | $1,789 | | Noninterest Income | $91,837 | $64,604 | | Noninterest Expenses | $97,141 | $87,201 | | Net Income | $37,411 | $26,991 | [Notes to Consolidated Financial Statements](index=74&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail the allowance for loan losses, ICM equity investment, goodwill reduction, and significant M&A transactions including the First State Bank acquisition and branch divestitures - The allowance for loan losses (ALL) methodology uses historical experience adjusted for qualitative factors, with the ALL balance increasing to **$25.8 million** at year-end 2020 from **$11.8 million** in 2019 (Note 3)[400](index=400&type=chunk)[499](index=499&type=chunk) - The investment in **Intercoastal Mortgage Company (ICM)** is an **equity method investment** that contributed **$24.2 million** to income in 2020 (Note 5)[520](index=520&type=chunk) - Goodwill **decreased from $19.6 million to $2.4 million**, primarily due to a **$16.9 million reduction** related to the **ICM mortgage combination transaction** (Note 12)[565](index=565&type=chunk) - Significant 2020 transactions include the **acquisition of assets from The First State Bank** (a **$4.7 million bargain purchase gain**), the **divestiture of four branches** (a **$9.6 million gain**), and the **combination with Intercoastal to form ICM** (a **$3.3 million gain**) (Note 24)[616](index=616&type=chunk)[622](index=622&type=chunk)[630](index=630&type=chunk)[632](index=632&type=chunk) [Changes in and Disagreements With Accountants on Accounting and Financial Disclosure](index=124&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20With%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants regarding accounting and financial disclosure - None [Controls and Procedures](index=124&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2020, excluding the recently acquired First State Bank - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective** as of December 31, 2020[637](index=637&type=chunk) - Management assessed internal control over financial reporting as **effective** as of December 31, 2020, based on the **COSO framework**, identifying **no material weaknesses**[642](index=642&type=chunk)[643](index=643&type=chunk) - The assessment of internal controls **excluded the operations of The First State Bank**, acquired during 2020, as permitted by SEC guidance[639](index=639&type=chunk) [Other Information](index=126&type=section&id=Item%209B.%20Other%20Information) The company reports no other information for this item - None [Part III](index=126&type=section&id=PART%20III) [Directors, Executive Officers and Corporate Governance](index=126&type=section&id=Item%2010.%20Directors,%20Executive%20Officers%20and%20Corporate%20Governance) Information for this item is incorporated by reference from the company's definitive 2021 Proxy Statement - This information is incorporated by reference from the registrant's definitive proxy statement for the 2021 Annual Meeting of Shareholders[650](index=650&type=chunk) [Executive Compensation](index=126&type=section&id=Item%2011.%20Executive%20Compensation) Information for this item is incorporated by reference from the company's definitive 2021 Proxy Statement - This information is incorporated by reference from the registrant's definitive proxy statement for the 2021 Annual Meeting of Shareholders[651](index=651&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=126&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Security ownership information is incorporated from the 2021 Proxy Statement, detailing 947,988 outstanding options at $14.66 and 569,997 available for future issuance Equity Compensation Plan Information as of December 31, 2020 | Plan Category | Securities to be issued upon exercise of outstanding options | Weighted-average exercise price of outstanding options | Securities remaining available for future issuance | | :--- | :--- | :--- | :--- | | Equity compensation plans approved by security holders | 947,988 | $14.66 | 569,997 | [Certain Relationships and Related Transactions, and Director Independence](index=126&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions,%20and%20Director%20Independence) Information for this item is incorporated by reference from the company's definitive 2021 Proxy Statement - This information is incorporated by reference from the registrant's definitive proxy statement for the 2021 Annual Meeting of Shareholders[654](index=654&type=chunk) [Principal Accountant Fees and Services](index=126&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information for this item is incorporated by reference from the company's definitive 2021 Proxy Statement - This information is incorporated by reference from the registrant's definitive proxy statement for the 2021 Annual Meeting of Shareholders[655](index=655&type=chunk) [Part IV](index=127&type=section&id=PART%20IV) [Exhibits and Financial Statement Schedules](index=127&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists financial statements filed under Item 8 and provides an index of all exhibits, including governance documents and certifications - This section lists the **consolidated financial statements** filed under **Item 8** and provides an **index of exhibits** filed with the report, including **governance documents**, **material agreements**, and **required certifications**[657](index=657&type=chunk)[659](index=659&type=chunk)[661](index=661&type=chunk) [Form 10-K Summary](index=129&type=section&id=Item%2016.%20Form%2010-K%20Summary) The company reports no Form 10-K summary - None