Central Valley(CVCY) - 2025 Q4 - Annual Results

Financial Performance - The Company reported unaudited consolidated net income of $11.17 million, or $0.58 per diluted share for Q4 2025, compared to $6.89 million and $0.36 per diluted share in Q4 2024, representing a 62.9% increase in net income year-over-year [1]. - For the twelve months ended December 31, 2025, net income was $38,168,000, significantly up from $7,666,000 in 2024, with diluted EPS rising to $2.00 from $0.45 [11]. - Net income for Q4 2025 reached $11,170,000, a 2.7% increase compared to $10,873,000 in Q3 2025 [50]. - Basic earnings per common share for Q4 2025 was $0.59, up from $0.57 in Q3 2025, reflecting a growth of 3.5% [50]. - Return on average assets was 1.23% for Q4 2025, compared to 1.21% in Q3 2025 and 0.78% in Q4 2024 [7]. - Return on average equity was 11.03% for Q4 2025, down from 11.25% in Q3 2025 but up from 7.55% in Q4 2024 [7]. Loan and Deposit Growth - Gross loans increased by $89.7 million, or 3.66%, for the quarter ended December 31, 2025, and increased $206.6 million, or 8.85%, year-to-date [3]. - Total average loans increased by $174,097,000 to $2,482,277,000 for the quarter ended December 31, 2025, driven by organic loan growth [14]. - Total deposits rose by $19.3 million, or 0.63%, compared to the previous quarter, and increased $184.5 million, or 6.34%, year-to-date [3]. - Total average deposits rose by $209,662,000 or 7.22% to $3,114,530,000 for the quarter ended December 31, 2025, compared to $2,904,868,000 in 2024 [30]. Interest Income and Margin - The net interest margin improved to 4.24% for Q4 2025, up from 4.20% in Q3 2025 and 3.95% in Q4 2024, marking the seventh consecutive quarter of improvement [4]. - Net interest income before provision for credit losses increased by $3,725,000 or 11.63% to $35,749,000 for the fourth quarter of 2025 compared to the same period in 2024 [15]. - Net interest income was $36,087,000, with a net interest margin of 4.24% [57]. - The net interest margin improved to 4.15% in 2025 from 3.76% in 2024, indicating enhanced profitability on interest-earning assets [62]. Non-Interest Income and Expenses - Total non-interest income for Q4 2025 was $2.55 million, compared to $2.30 million in Q4 2024, reflecting a 10.7% increase [5]. - Total non-interest income for Q4 2025 was $2,547,000, a decrease from $2,966,000 in Q3 2025, reflecting a decline of 14.1% [52]. - Total non-interest expenses decreased by $4,315,000 or 4.6% to $90,386,000 for the twelve months ended December 31, 2025, primarily due to a reduction in non-recurring merger expenses [23]. Credit Quality - The provision for credit losses decreased to $515,000 in Q4 2025 from $667,000 in Q3 2025, indicating improved credit quality [3]. - The Company recorded a provision for loan losses of $599,000 for the fourth quarter of 2025, down from $971,000 in the same quarter of 2024 [32]. - The allowance for credit losses increased to $30,071,000, representing 1.18% of total loans, up from 1.11% in the previous year [34]. - The percentage of "Special mention" loans rose to 2.1% from 1.0% in the previous quarter [34]. Merger and Expansion - The Company signed a definitive merger agreement with United Security Bancshares, expected to close in Q2 2026, which will create a combined entity with approximately $5 billion in total assets [3]. - The Company announced a merger with United Security Bancshares, valued at approximately $188.7 million based on a share exchange ratio of 0.4520 shares of CWB common stock for each USB share [36][37]. - The merger will expand the Company's presence with full-service branches in five additional counties in Central California [36]. Capital and Assets - Total assets increased by $168,546,000 or 4.79% to $3,646,566,000 as of December 31, 2025, compared to the previous year [25]. - Total equity increased to $409,588,000 from $397,576,000 in the prior quarter [54]. - Shareholders' equity rose to $384,828,000 in 2025, compared to $317,142,000 in 2024, representing an increase of approximately 21.3% [60]. - The Company continues to maintain adequate capital levels and is well-capitalized [35].