For Immediate Release

 

 

Contact:  D. Linn Wiley

                        President and Chief Executive Officer

                        (909) 980-4030

 

CVB Financial Corp. Reports Record Third Quarter Earnings

 

Ontario, CA, October 17, 2002 -- CVB Financial Corp. (NASDAQ-CVBF) and its subsidiary, Citizens Business Bank, announced record results for the third quarter of 2002.  This included record deposits, record loans, record assets and record earnings.  This is the 42nd consecutive quarter of record earnings for the Company.

 

CVB Financial Corp. reported net income of $13.2 million for the third quarter ending September 30, 2002.  This represents an increase of $2.4 million, or 22.34%, when compared with the $10.8 million in net income reported for the third quarter of 2001.  Earnings per share for the third quarter of 2002 were $0.37 per diluted share.  This is up $0.07, or 23.33%, when compared with earnings per share of $0.30 for the third quarter of 2001.

 

Earnings results for the third quarter of 2002 produced a return on beginning equity of 24.26%, a return on average equity of 21.66% and a return on average assets of 1.95%.  The efficiency ratio for the third quarter was 46.19%.

 

During the quarter, the Company restructured a portion of the investment portfolio to align it with the current interest rate environment.  This involved the sale of $87.6 million in securities.  The sale of these securities resulted in a gain of $1.8 million before taxes, and a gain of $1.2 million after taxes.

 

If the Company had not realized this gain on the sale of securities, net income would have been $12.0 million.  This would represent an increase in net income of $1.3 million, or 12.54%, over the $10.7 million for 2001.  The comparable net income per diluted share would be $0.34.  This would be an increase of $0.04, or 11.79%, over the net income per diluted share of $0.30 for 2001.

 

These earnings results would have produced a return on beginning equity of 22.02%, a return on average equity of 21.16% and a return on average assets of 1.90%.  The related efficiency ratio would have been 46.60%.

 

Net income for the nine months ending September 30, 2002 was $37.2 million.  This represents an increase of $7.9 million, or 27.04%, when compared with net earnings of $29.3 million for the same period in 2001.   Diluted earnings per share were $1.04.  This was up $0.22, or 26.21%, from diluted earnings per share of $0.82 for the same period last year.  Net income for the nine months ending September 30, 2002 produced a return on beginning equity of 22.76%, a return on average equity of 20.67% and a return on average assets of 1.85%.  The efficiency ratio for the nine-month period was 45.91%.

 

The Company realized aggregate gains on the sale of a portion of the investment portfolio of $4.9 million before taxes, and $3.1 million after taxes through the first nine months of 2002.  If the Company had not realized these gains on the sale of securities, net income would have been $34.0 million.  This would represent an increase in net income of $4.8 million, or 16.57%, over the $29.2 million for 2001.  The comparable net income per diluted share would be $0.96.  This would be an increase of $0.14, or 16.51%, over the net income per diluted share of $0.82 for 2001.

 

These earnings results would have produced a return on beginning equity of 20.80%, a return on average equity of 18.89% and a return on average assets of 1.69%.  The related efficiency ratio would have been 48.16%.

 

Total deposits rose to $2.19 billion as of September 30, 2002.  This is up $443.8 million, or 25.31%, from $1.75 billion for the same period last year.  Gross loans and leases grew to $1.33 billion as of September 30, 2002.  This is an increase of $256.3 million, or 23.81%, from the $1.08 billion in gross loans and leases on September 30, 2001.  Total assets were $2.85 billion as of September 30, 2002.  This represents an increase of $480.9 million, or 20.31%, over the $2.37 billion in total assets reported on September 30, 2001.  In addition, trust assets were $932.8 million on September 30, 2002.

 

“We are pleased to report these positive operating results,” said D. Linn Wiley, President and Chief Executive Officer of CVB Financial Corp.  “The growth in net earnings exceeds our objective to increase earnings by 15.00% for the year.”

 

CVB Financial Corp. reported non-performing loans and non-performing assets of $818,000 as of September 30, 2002.  This represents a ratio of non-performing assets to total assets of 0.03%.  The allowance for loan and lease losses was $22.6 million as of September 30, 2002.  This represents 1.70% of gross loans and leases, and compares with 1.98% on September 30, 2001.  Non-performing loans and leases were 3.61% of the allowance for loan and lease losses.

 

CVB Financial Corp. is the holding company for Citizens Business Bank.  The Bank is the largest bank headquartered in the Inland Empire region of Southern California.  It serves 25 cities with 32 business financial centers in Los Angeles, Orange, Riverside, San Bernardino and Kern counties.  Shares of CVB Financial Corp. common stock are listed on the NASDAQ under the ticker symbol of CVBF.  For investor information on CVB Financial Corp. visit our Citizens Business Bank website at www.cbbank.com and click on the CVB Investor tab.

 

Safe Harbor

This document may contain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from the projected.  For a discussion of factors that could cause actual results to differ, please see the publicly available Securities and Exchange Commission filings of CVB Financial Corp., including its Annual Report on Form 10-K for the year ended December 31, 2001, and particularly the discussion of risk factors within that document.

 

Comparative financial statements to follow.

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