Sierra Vista in California Endures Earnings Dip on Margin Woes

Sierra Vista Bank (SVBA) in Folsom, Calif., is soldiering on with newly raised capital, though its profit shrank in the fourth quarter.

The $79 million-asset bank's fourth-quarter profit fell 40% from a year earlier, to $38,000, because of a lower net interest margins and declining income. Still, the company had its ninth straight profitable month, continuing a string of success that helped it raise over $2 million in an offering. The bank also secured $1.7 million last month from Taylor International Fund, a hedge fund.

Sierra Vista's fourth-quarter net interest income fell 3% from a year earlier, to $958,000. Its net interest margin contracted by three basis points from the fourth quarter of 2011, to 5.07%.

Asset quality has improved. Nonperforming loans fell 7% from a year earlier. The loan-loss provision fell 52% from a year earlier, to $80,000.

Sierra Vista's noninterest income fell by 1% from a year earlier, to $141,000, as fewer securities gains offset a rise in customer-service fees.

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