8-KCA000-3197777-05391257100 N. Financial Dr., Ste. 101FresnoCA93720559298-1775FALSE000112737100011273712023-07-202023-07-20

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: July 20, 2023
(Date of earliest event reported)
Central Valley Community Bancorp
(Exact name of registrant as specified in its charter)
CA
(State or other jurisdiction
of incorporation)
000-31977
(Commission File Number)
77-0539125
(IRS Employer
Identification Number)
7100 N. Financial Dr., Ste. 101, Fresno, CA
(Address of principal executive offices)
93720
(Zip Code)
559-298-1775
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Common Stock, no par valueCVCYNASDAQ
(Title of Each Class)(Trading Symbol)(Name of Each Exchange on which Registered)
Not Applicable
(Former Name or Former Address, if changed since last report)



Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

    Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

    Emerging growth company ☐

    If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act  o


Item 2.02. Results of Operations and Financial Condition

On July 20, 2023, Central Valley Community Bancorp issued a press release containing unaudited financial information and
accompanying discussion for the quarter and three months ended June 30, 2023. The press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.

Item 8.01. Other Events

On July 19, 2023 the Board of Directors of Central Valley Community Bancorp declared a $0.12 per share cash dividend
payable on August 18, 2023 to shareholders of record as of August 4, 2023.

The information in this Form 8-K filed on July 20, 2023 shall not be deemed “filed” for purposes of Section 18 of the
Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by
reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, regardless of any general
incorporation language in such filing.

Item 9.01. Financial Statements and Exhibits

(a) Financial statements:
            None
(b) Pro forma financial information:
            None
(c) Shell company transactions:
            None
(d) Exhibits




SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated:
July 20, 2023
CENTRAL VALLEY COMMUNITY BANCORP

By:  /s/ Shannon Avrett                  
      Shannon Avrett
      Executive Vice President and Chief Financial Officer (Principal
      Accounting Officer)
Exhibit Index
Exhibit No.Description
99.1Press Release of Central Valley Community Bancorp dated
July 20, 2023



cvcb072022.jpg
FOR IMMEDIATE RELEASE

CENTRAL VALLEY COMMUNITY BANCORP REPORTS EARNINGS RESULTS FOR THE PERIOD ENDED JUNE 30, 2023, AND QUARTERLY DIVIDEND

FRESNO, CALIFORNIA... July 20, 2023... The Board of Directors of Central Valley Community Bancorp (Company) (NASDAQ: CVCY), the parent company of Central Valley Community Bank (Bank), reported today unaudited consolidated net income of $6,282,000, and fully diluted earnings per common share of $0.54 for the quarter ended June 30, 2023, compared to $6,542,000 and $0.56 per fully diluted common share for the quarter ended June 30, 2022.
SECOND QUARTER FINANCIAL HIGHLIGHTS
•Net income for the second quarter of 2023 decreased to $6,282,000 or $0.54 per diluted common share, compared to $6,970,000 and $0.59, respectively, in the first quarter of 2023.
•Net loans decreased $5.3 million or 0.42%, and total assets increased $67.3 million or 2.78% at June 30, 2023 compared to December 31, 2022.
•Total deposits increased 4.79% to $2.20 billion at June 30, 2023 compared to December 31, 2022.
•Total cost of deposits increased to 0.88% for the quarter ended June 30, 2023 compared to 0.20% for the quarter ended March 31, 2023.
•Average non-interest bearing demand deposit accounts as a percentage of total average deposits was 43.53% and 43.92% for the quarters ended June 30, 2023 and 2022, respectively.
•Net interest margin decreased to 3.46% for the quarter ended June 30, 2023, from 3.81% for the quarter ended March 31, 2023.
•There were no non-performing assets for the quarter ended June 30, 2023. Additionally, net loan recoveries were $22,000 and loans delinquent more than 30 days were $252,000.
•Capital positions remain strong at June 30, 2023 with a 8.51% Tier 1 Leverage Ratio; a 12.39% Common Equity Tier 1 Ratio; a 12.68% Tier 1 Risk-Based Capital Ratio; and a 15.73% Total Risk-Based Capital Ratio.
•The Company declared a $0.12 per common share cash dividend, payable on August 18, 2023 to shareholders of record as of August 4, 2023.

“The challenging environment including rising cost of deposits and persistent inflation are impacting interest and operating expenses. The Company is not immune to these challenges, but our Company is well positioned to navigate it,” said James J. Kim, President and CEO.

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Central Valley Community Bancorp -- page 2
“The strength of our Company has long been demonstrated by its 43-year track record of conservative business practices, its focus on relationships and stability in deposit base,” continued Kim. “To reinforce that strength, the Company will continue to invest in our team, facilities and technologies while maintaining our commitment to exceptional client service Bank-wide. Our team’s unfaltering focus on client success has been most gratifying, particularly during this past quarter.”

Results of Operations
June 30,March 31,June 30,
(In thousands, except share and per-share amounts) 202320232022
Net interest income before provision for credit losses$20,205 $21,581 $19,810 
(Reversal of) provision for credit losses(343)633 — 
Net interest income after provision for credit losses20,548 20,948 19,810 
Total non-interest income1,594 1,575 770 
Total non-interest expenses13,805 13,205 12,083 
Income before provision for income taxes8,337 9,318 8,497 
Provision for income taxes 2,055 2,348 1,955 
Net income$6,282 $6,970 $6,542 

For the quarter ended June 30, 2023, the Company reported unaudited consolidated net income of $6,282,000 and earnings per diluted common share of $0.54, compared to consolidated net income of $6,542,000 and $0.56 per diluted share for the same period in 2022. Net income for the period was impacted by an increase in total non-interest expenses of $1,722,000, primarily driven by the increase in costs for salaries and employee benefits and non-recurring one-time expenses in professional services, and an increase in the provision for income taxes of $100,000, partially offset by an increase in net interest income before provision for credit losses of $395,000 and an increase in non-interest income of $824,000. The effective tax rate increased to 24.65% from 23.01% for the quarters ended June 30, 2023 and June 30, 2022, respectively. Net income for the immediately trailing quarter ended March 31, 2023 was $6,970,000, or $0.59 per diluted common share.

For the six months ended June 30, 2023, the Company reported unaudited consolidated net income of $13,252,000 and earnings per diluted common share of $1.13, compared to consolidated net income of $12,628,000 and $1.07 per diluted share for the same period in 2022. Net income for the period was impacted by an increase in net interest income before provision for credit losses of $4,379,000 and an increase in non-interest income of $565,000, partially offset by an increase in total non-interest expenses of $3,482,000 and an increase in the provision for income taxes of $548,000. The effective tax rate increased to 24.94% from 23.39% for the six months ended June 30, 2023 and June 30, 2022, respectively. Increases in non-interest expenses for the year-to-date period were impacted by increased salary expense, inflationary impacts of increased cost of services, and non-recurring professional expenses.

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Central Valley Community Bancorp -- page 3
Annualized return on average equity (ROE) for the six months ended June 30, 2023 was 14.44%, compared to 12.35% for the same period of 2022. The increase in ROE reflects an increase in net income and a decrease in average shareholders’ equity compared to the prior year. The decrease in shareholders’ equity was primarily driven by the increase in accumulated other comprehensive losses and dividends paid, partially offset by the retention of earnings. Annualized return on average assets (ROA) was 1.08% for the six months ended June 30, 2023 compared to 1.03% for the same period in 2022. This increase was due to the increase in net income outpacing the increase in average assets.

The effective yield on average investment securities, including interest earning deposits in other banks and Federal funds sold, was 3.18% for the quarter ended June 30, 2023, compared to 2.58% for the quarter ended June 30, 2022 and 2.95% for the quarter ended March 31, 2023. The effective yield on average investment securities, including interest earning deposits in other banks and Federal funds sold, was 3.07% for the six months ended June 30, 2023, compared to 2.30% for the six months ended June 30, 2022.

Total average loans increased by $171,817,000 to $1,257,984,000 for the quarter ended June 30, 2023, from $1,086,167,000 for the quarter ended June 30, 2022 and decreased by $2,194,000 from $1,260,178,000 for the quarter ended March 31, 2023. The effective yield on average loans was 5.54% for the quarter ended June 30, 2023, compared to 4.76% and 5.31% for the quarters ended June 30, 2022 and March 31, 2023, respectively. Total average loans increased by $206,958,000 to $1,259,075,000 for the six months ended June 30, 2023, from $1,052,117,000 for the six months ended June 30, 2022. The effective yield on average loans was 5.47% for the six months ended June 30, 2023, compared to 4.80% for the six months ended June 30, 2022.

The Company’s net interest margin (fully tax equivalent basis) was 3.46% for the quarter ended June 30, 2023, compared to 3.48% for the quarter ended June 30, 2022. Net interest income, before provision for credit losses, increased $395,000, or 1.99%, to $20,205,000 for the second quarter of 2023, compared to $19,810,000 for the same period in 2022. The net interest margin period-to-period comparisons were impacted by the increase in the yield on total interest-bearing liabilities. Over the same periods, the cost of total deposits increased to 0.88% from 0.04%. The increase in the cost of deposits is primarily attributed to volume and rate increases in the money market and time deposit portfolios.

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Central Valley Community Bancorp -- page 4
The Company’s net interest margin (fully tax equivalent basis) was 3.65% for the six months ended June 30, 2023, compared to 3.34% for the six months ended June 30, 2022. Net interest income, before provision for credit losses, increased $4,379,000, or 11.71%, to $41,786,000 for the six months ended June 30, 2023, compared to $37,407,000 for the same period in 2022. The accretion on loan marks of acquired loans increased interest income by $139,000 and $324,000 during the six months ended June 30, 2023 and 2022, respectively. Net interest income during the six months ended June 30, 2023 and 2022 benefited by approximately $42,000 and $470,000, respectively, from prepayment penalties and payoff of loans. The net interest margin period-to-period comparisons were impacted by the increase in the yield on total interest-bearing liabilities. Over the same periods, the cost of total deposits increased to 0.55% from 0.05%. The increase in the cost of deposits is primarily attributed to volume and rate increases in the money market and time deposit portfolios.

Non-Interest Income - The following tables present the key components of non-interest income for the periods indicated:
Three months ended
(Dollars in thousands)June 30, 2023June 30, 2022$ Change% Change
Service charges$367 $544 $(177)(32.5)%
Appreciation in cash surrender value of bank owned life insurance254 245 9 3.7 %
Interchange fees458 478 (20)(4.2)%
Loan placement fees172 268 (96)(35.8)%
Net realized losses on sales and calls of investment securities(39)(969)930 (96.0)%
Federal Home Loan Bank dividends106 82 24 29.3 %
Other income276 122 154 126.2 %
Total non-interest income$1,594 $770 $824 107.0 %

Six months ended
(Dollars in thousands)June 30, 2023June 30, 2022$ Change% Change
Service charges$755 $1,083 $(328)(30.3)%
Appreciation in cash surrender value of bank owned life insurance503 487 16 3.3 %
Interchange fees903 920 (17)(1.8)%
Loan placement fees296 567 (271)(47.8)%
Net realized losses on sales and calls of investment securities(257)(763)506 (66.3)%
Federal Home Loan Bank dividends215 167 48 28.7 %
Other income754 143 611 427.3 %
Total non-interest income$3,169 $2,604 $565 21.7 %

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Central Valley Community Bancorp -- page 5
The increase in other income for the six months ended June 30, 2023 was primarily due to the change in equity investment gain (loss), which was zero for the six months ended June 30, 2023 compared to ($584,000) for the six months ended June 30, 2022. The decrease in service charges was the result of a reduction in the fess charged for non-sufficient funds.

Non-Interest Expense - The following table presents the key components of non-interest expense for the periods indicated:
Three months ended
(Dollars in thousands)June 30, 2023June 30, 2022$ Change% Change
Salaries and employee benefits$7,976 $7,057 $919 13.0 %
Occupancy and equipment1,264 1,344 (80)(6.0)%
Information technology935 828 107 12.9 %
Regulatory assessments356 194 162 83.5 %
Data processing expense618 548 70 12.8 %
Professional services883 464 419 90.3 %
ATM/Debit card expenses193 217 (24)(11.1)%
Internet banking expense47 48 (1)(2.1)%
Advertising124 138 (14)(10.1)%
Directors’ expenses151 48 103 214.6 %
Amortization of core deposit intangibles34 140 (106)(75.7)%
Loan related expenses 51 68 (17)(25.0)%
Personnel other63 59 4 6.8 %
Other expense1,110 930 180 19.4 %
Total non-interest expenses$13,805 $12,083 $1,722 14.3 %

The increase in salaries and benefits and director expenses was due to expense recorded in the current quarter for post-retirement benefits compared to credits recorded in the prior year, which were a result of changes in the discount rate. In addition, salary and employee benefits increased in the current quarter compared to the prior year quarter due to salary adjustments related to market conditions. The increase in regulatory assessments was the result of FDIC adjustment in their rate and assessment multiplier. The increase in professional services was the result of non-recurring one-time expenses recorded during the period.
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Central Valley Community Bancorp -- page 6
Six months ended
(Dollars in thousands)June 30, 2023June 30, 2022$ Change% Change
Salaries and employee benefits$16,010 $14,001 $2,009 14.3 %
Occupancy and equipment2,521 2,506 15 0.6 %
Information technology1,782 1,586 196 12.4 %
Regulatory assessments566 416 150 36.1 %
Data processing expense1,269 1,089 180 16.5 %
Professional services1,235 838 397 47.4 %
ATM/Debit card expenses377 412 (35)(8.5)%
Internet banking expense82 69 13 18.8 %
Advertising249 278 (29)(10.4)%
Directors’ expenses314 93 221 237.6 %
Amortization of core deposit intangibles68 280 (212)(75.7)%
Loan related expenses 198 139 59 42.4 %
Personnel other323 162 161 99.4 %
Other expense2,016 1,659 357 21.5 %
Total non-interest expenses$27,010 $23,528 $3,482 14.8 %

The increase in salaries and benefits and director expenses was primarily due to credits in post-retirement costs recorded in the prior year, a result of changes in the discount rate compared to expense in the current period. Additionally, increases in salaries and benefits were a reflection of salary adjustments due to market conditions. The increase in personnel other was primarily the result of employee placement fees.

Balance Sheet Summary
Total assets for the period ended June 30, 2023 increased $67,288,000 or 2.78% compared to the period ended December 31, 2022, and $25,914,000 or 1.07% compared to the first quarter of 2023. Asset growth during the six months ended June 30, 2023 was driven by increases in cash and cash equivalents. Total average assets for the quarter ended June 30, 2023 were $2,501,524,000 compared to $2,441,962,000 for the quarter ended June 30, 2022 and $2,415,640,000 for the quarter ended March 31, 2023, a increase of $59,562,000 or 2.44% and a increase of $85,884,000 or 3.52%, respectively.

For the quarter ended June 30, 2023, the Company’s average investment securities decreased by $197,499,000, or 16.20%, compared to the quarter ended June 30, 2022, and decreased by $19,462,000, or 1.87%, compared to the quarter ended March 31, 2023. For the six months ended June 30, 2023, the Company’s average investment securities, decreased by $147,335,000, or 12.50%, compared to the six months ended June 30, 2022. These decreases for both periods were the result of sales, maturities, and the change in the unrealized loss position on available for sale securities.

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Central Valley Community Bancorp -- page 7
In comparing the quarter ended June 30, 2023 to the quarter ended March 31, 2023, and the quarter ended June 30, 2022, total average gross loans decreased by $2,194,000 or 0.17% and increased $171,817,000 or 15.82%, respectively. Year-to-date average gross loans increased $206,958,000 or 19.67% when compared to the six months ended June 30, 2022.

The following table shows the Company’s outstanding loan portfolio composition as of June 30, 2023 and December 31, 2022:
Loan Type (dollars in thousands)June 30, 2023% of Total
Loans		December 31, 2022% of Total
Loans
Commercial:
Commercial and industrial$103,490 8.2 %$141,197 11.2 %
Agricultural production36,283 2.9 %37,007 2.9 %
Total commercial139,773 11.1 %178,204 14.1 %
Real estate:
Construction & other land loans77,865 6.2 %109,175 8.7 %
Commercial real estate - owner occupied195,348 15.6 %194,663 15.5 %
Commercial real estate - non-owner occupied502,814 40.1 %464,809 37.2 %
Farmland118,616 9.4 %119,648 9.5 %
Multi-family residential53,432 4.3 %24,586 2.0 %
1-4 family - close-ended90,064 7.2 %93,510 7.4 %
1-4 family - revolving28,625 2.3 %30,071 2.4 %
Total real estate1,066,764 85.1 %1,036,462 82.7 %
Consumer:47,597 3.8 %40,252 3.2 %
Net deferred origination fees1,524 1,386 
Total gross loans1,255,658 100.0 %1,256,304 100.0 %
Allowance for credit losses(15,463)(10,848)
Total loans$1,240,195 $1,245,456 

Total average deposits increased $54,852,000, or 2.54%, to $2,212,592,000 for the quarter ended June 30, 2023, compared to $2,157,740,000 for the quarter ended June 30, 2022, and increased $131,334,000, or 6.31%, compared to $2,081,258,000 for the quarter ended March 31, 2023. The Company’s ratio of average non-interest bearing deposits to total deposits was 43.53% for the quarter ended June 30, 2023, compared to 43.92% and 48.92% for the quarters ended June 30, 2022 and March 31, 2023, respectively.

Total average deposits decreased $6,505,000, or 0.30%, to $2,147,287,000 for the six months ended June 30, 2023, compared to $2,153,792,000 for the six months ended June 30, 2022. The Company’s ratio of average non-interest bearing deposits to total deposits increased to 46.13% for the six months ended June 30, 2023 compared to 43.85% for the six months ended June 30, 2022.
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Central Valley Community Bancorp -- page 8

The composition of deposits at June 30, 2023 and December 31, 2022 is summarized in the table below:
(Dollars in thousands)June 30, 2023% of
Total
Deposits		December 31, 2022% of
Total
Deposits
NOW accounts$272,419 12.4 %$324,089 15.4 %
MMA accounts569,807 25.9 %435,783 20.8 %
Time deposits208,864 9.5 %67,923 3.2 %
Savings deposits192,116 8.7 %215,287 10.3 %
Total interest-bearing1,243,206 56.5 %1,043,082 49.7 %
Non-interest bearing957,088 43.5 %1,056,567 50.3 %
Total deposits$2,200,294 100.0 %$2,099,649 100.0 %

The Company has significant liquidity, both on and off-balance sheet, to meet customer demand. During the year-to-date period, the Company’s cash and cash equivalents increased $97,488,000 to $128,658,000 compared to $31,170,000 at December 31, 2022. The Company had no short-term borrowings at June 30, 2023 compared to $46,000,000 at December 31, 2022. At June 30, 2023 and December 31, 2022, the Company had the following sources of primary and secondary liquidity:

Liquidity Sources (in thousands)June 30, 2023December 31, 2022
Cash and cash equivalents$128,658 $31,170 
Unpledged investment securities684,113 758,389 
Excess pledged securities117,988 81,527 
FHLB borrowing availability347,510 319,309 
FRB Bank Term Funding Program (BTFP) availability37,968 — 
Unsecured lines of credit110,000 110,000 
Funds available through FRB discount window4,583 4,702 
Total$1,430,820 $1,305,097 

Credit Quality
During the second quarter of 2023, the Company recorded net loan recoveries of $22,000 compared to $9,000 for the same period in 2022. The net charge-off (recovery) ratio, which reflects annualized net charge-offs (recoveries) to average loans, was (0.01)% for the quarter ended June 30, 2023 compared to 0.00% for the quarter ended June 30, 2022. During the quarter ended June 30, 2023, the Company recorded a provision of $184,000 for credit losses on loans, compared to no provision for the quarter ended June 30, 2022. Offsetting this provision of credit losses on loans were credits to the provision for losses on held-to-maturity securities and unfunded loan commitments totaling $527,000.

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Central Valley Community Bancorp -- page 9
The following table shows the Company’s loan portfolio allocated by management’s internal risk ratings:
Loan Risk Rating (In thousands)June 30, 2023March 31, 2023June 30, 2022
Pass$1,212,129 $1,225,913 $1,089,423 
Special mention18,094 29,061 34,509 
Substandard25,435 30,580 10,756 
Doubtful— — — 
Total$1,255,658 $1,285,554 $1,134,688 
At June 30, 2023, the allowance for credit losses was $15,463,000, compared to $10,848,000 at December 31, 2022, a net increase of $4,615,000 reflecting a CECL implementation Day 1 adjustment of $3,910,000, a provision of $702,000 and net recoveries during the period. The allowance for credit losses as a percentage of total loans was 1.23% and 0.86% as of June 30, 2023 and December 31, 2022, respectively. The Company believes the allowance for credit losses is adequate to provide for expected credit losses within the loan portfolio at June 30, 2023.

Cash Dividend Declared
On July 19, 2023, the Board of Directors of the Company declared a regular quarterly cash dividend of $0.12 per share on the Company’s common stock. The dividend is payable on August 18, 2023 to shareholders of record as of August 4, 2023. The Company continues to be well capitalized and expects to maintain adequate capital levels.

Company Overview
Central Valley Community Bancorp trades on the NASDAQ stock exchange under the symbol CVCY. Central Valley Community Bank (CVCB), headquartered in Fresno, California, was founded in 1979 and is the sole subsidiary of Central Valley Community Bancorp. CVCB operates full-service Banking Centers throughout California’s San Joaquin Valley and Greater Sacramento region, in addition to CVCB maintaining Commercial, Real Estate, and Agribusiness Lending, as well as Private Business Banking and Cash Management Departments.

Members of Central Valley Community Bancorp’s and CVCB’s Board of Directors are: Daniel J. Doyle (Chairman), Daniel N. Cunningham (Vice Chairman), F. T. “Tommy” Elliott, IV, Robert J. Flautt, Gary D. Gall, James J. Kim, Andriana D. Majarian, Steven D. McDonald, Louis C. McMurray, Karen A. Musson, Dorothea D. Silva and William S. Smittcamp.

More information about Central Valley Community Bancorp and Central Valley Community Bank can be found at www.cvcb.com. Also, visit Central Valley Community Bank on Twitter, Facebook and LinkedIn.
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Central Valley Community Bancorp -- page 10
Forward-looking Statements- Certain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are forward-looking in nature and involve a number of risks and uncertainties. Such risks and uncertainties include, but are not limited to (1) significant increases in competitive pressure in the banking industry; (2) the impact of changes in interest rates; (3) a decline in economic conditions in the Central Valley and the Greater Sacramento Region, including the impact of inflation; (4) the Company’s ability to continue its internal growth at historical rates; (5) the Company’s ability to maintain its net interest margin; (6) the decline in quality of the Company’s earning assets; (7) a decline in credit quality; (8) changes in the regulatory environment; (9) fluctuations in the real estate market; (10) changes in business conditions and inflation; (11) changes in securities markets (12) risks associated with acquisitions, relating to difficulty in integrating combined operations and related negative impact on earnings, and incurrence of substantial expenses; (13) political developments, uncertainties or instability, catastrophic events, acts of war or terrorism, or natural disasters, such as earthquakes, drought, pandemic diseases or extreme weather events, any of which may affect services we use or affect our customers, employees or third parties with which we conduct business; and (14) the other risks set forth in the Company’s reports filed with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2022. Therefore, the information set forth in such forward-looking statements should be carefully considered when evaluating the business prospects of the Company.

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Central Valley Community Bancorp -- page 11
CENTRAL VALLEY COMMUNITY BANCORP
CONSOLIDATED BALANCE SHEETS
(Unaudited)
June 30,December 31,June 30,
(In thousands, except share amounts)202320222022
ASSETS
Cash and due from banks$28,325 $25,485 $26,579 
Interest-earning deposits in other banks100,333 5,685 654 
Total cash and cash equivalents128,658 31,170 27,233 
Available-for-sale debt securities 619,759 648,825 710,481 
Held-to-maturity debt securities 303,876 305,107 305,902 
Equity securities6,558 6,558 6,832 
Loans, less allowance for credit losses of $15,463, $10,848, and $9,873 at June 30, 2023, December 31, 2022, and June 30, 2022, respectively1,240,195 1,245,456 1,126,091 
Bank premises and equipment, net10,939 7,987 8,060 
Bank owned life insurance41,041 40,537 40,040 
Federal Home Loan Bank stock7,136 6,169 6,169 
Goodwill53,777 53,777 53,777 
Accrued interest receivable and other assets77,868 76,933 69,007 
Total assets$2,489,807 $2,422,519 $2,353,592 
LIABILITIES AND SHAREHOLDERS’ EQUITY 
Deposits:
Non-interest bearing$957,088 $1,056,567 $931,157 
Interest bearing1,243,206 1,043,082 1,174,840 
Total deposits2,200,294 2,099,649 2,105,997 
Short-term borrowings— 46,000 9,324 
Senior debt and subordinated debentures69,671 69,599 39,526 
Accrued interest payable and other liabilities32,482 32,611 28,492 
Total liabilities2,302,447 2,247,859 2,183,339 
Shareholders’ equity:
Preferred stock, no par value; 10,000,000 shares authorized, none issued and outstanding
— — — 
Common stock, no par value; 80,000,000 shares authorized; issued and outstanding: 11,812,425, 11,735,291, and 11,717,146, at June 30, 2023, December 31, 2022, and June 30, 2022, respectively62,128 61,487 60,975 
Retained earnings201,100 194,400 183,197 
Accumulated other comprehensive loss, net of tax(75,868)(81,227)(73,919)
Total shareholders’ equity187,360 174,660 170,253 
Total liabilities and shareholders’ equity$2,489,807 $2,422,519 $2,353,592 

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Central Valley Community Bancorp -- page 12
CENTRAL VALLEY COMMUNITY BANCORP
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)    
For the Three Months EndedFor the Six Months Ended
June 30,March 31,June 30,June 30,
(In thousands, except share and per-share amounts)20232023202220232022
INTEREST INCOME:
Interest and fees on loans$17,382 $16,777 $12,883 $34,159 $25,044 
Interest on deposits in other banks1,374 75 52 1,449 109 
Interest and dividends on investment securities:
Taxable5,826 5,886 5,651 11,712 10,175 
Exempt from Federal income taxes1,405 1,405 1,879 2,810 3,319 
Total interest income25,987 24,143 20,465 50,130 38,647 
INTEREST EXPENSE:
Interest on deposits4,871 1,004 231 5,876 483 
Interest on short-term borrowings— 661 91 661 91 
Interest on senior debt and subordinated debentures911 897 333 1,807 666 
Total interest expense5,782 2,562 655 8,344 1,240 
Net interest income before (credit) provision for credit losses20,205 21,581 19,810 41,786 37,407 
(CREDIT) PROVISION FOR CREDIT LOSSES(343)633 — 290 — 
Net interest income after (credit) provision for credit losses20,548 20,948 19,810 41,496 37,407 
NON-INTEREST INCOME:
Service charges367 387 544 755 1,083 
Net realized losses on sales and calls of investment securities(39)(219)(969)(257)(763)
Other income1,266 1,407 1,195 2,671 2,284 
Total non-interest income1,594 1,575 770 3,169 2,604 
NON-INTEREST EXPENSES:
Salaries and employee benefits7,976 8,034 7,057 16,010 14,001 
Occupancy and equipment1,264 1,258 1,344 2,521 2,506 
Other expense4,565 3,913 3,682 8,479 7,021 
Total non-interest expenses13,805 13,205 12,083 27,010 23,528 
Income before provision for income taxes8,337 9,318 8,497 17,655 16,483 
PROVISION FOR INCOME TAXES2,055 2,348 1,955 4,403 3,855 
Net income$6,282 $6,970 $6,542 $13,252 $12,628 
Net income per common share:
Basic earnings per common share$0.54 $0.60 $0.56 $1.13 $1.08 
Weighted average common shares used in basic computation11,723,127 11,703,813 11,665,074 11,713,524 11,746,795 
Diluted earnings per common share$0.54 $0.59 $0.56 $1.13 $1.07 
Weighted average common shares used in diluted computation11,740,390 11,731,135 11,685,850 11,738,037 11,778,127 
Cash dividends per common share$0.12 $0.12 $0.12 $0.24 $0.24 
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Central Valley Community Bancorp -- page 13
CENTRAL VALLEY COMMUNITY BANCORP
CONDENSED CONSOLIDATED INCOME STATEMENTS
(Unaudited)
June. 30,Mar. 31,Dec. 31,Sept. 30,Jun. 30,
For the three months ended20232023202220222022
(In thousands, except share and per share amounts)
Net interest income$20,205 $21,581 $21,993 $20,164 $19,810 
(Credit) provision for credit losses(343)518 500 500 — 
Net interest income after (credit) provision for credit losses20,548 20,948 21,493 19,664 19,810 
Total non-interest income1,594 1,575 970 1,480 770 
Total non-interest expense13,805 13,205 12,152 12,798 12,083 
Provision for income taxes2,055 2,348 2,678 1,962 1,955 
Net income$6,282 $6,970 $7,633 $6,384 $6,542 
Basic earnings per common share$0.54 $0.60 $0.65 $0.55 $0.56 
Weighted average common shares used in basic computation11,723,127 11,703,813 11,690,410 11,678,532 11,665,074 
Diluted earnings per common share$0.54 $0.59 $0.65 $0.55 $0.56 
Weighted average common shares used in diluted computation11,740,390 11,731,135 11,708,753 11,689,323 11,685,850 

CENTRAL VALLEY COMMUNITY BANCORP
SELECTED RATIOS
(Unaudited)
Jun. 30,Mar. 31,Dec. 31,Sep. 30,Jun. 30,
As of and for the three months ended20232023202220222022
(Dollars in thousands, except per share amounts)
Allowance for credit losses to total loans1.23 %1.19 %0.86 %0.85 %0.87 %
Non-performing assets to total assets— %— %— %0.01 %0.01 %
Total non-performing assets$— $— $— $251 $271 
Total nonaccrual loans$— $— $— $251 $271 
Total substandard loans$25,435 $30,580 $27,785 $22,657 $10,756 
Total special mention loans$18,094 $29,061 $31,023 $30,894 $34,509 
Net loan charge-offs (recoveries)$(22)$19 $18 $7 $(9)
Net (recoveries) charge-offs to average loans (annualized)(0.01)%0.01 %0.01 %— %— %
Book value per share$15.86 $15.49 $14.88 $13.54 $13.90 
Tangible book value per share (1)$11.31 $10.91 $10.30 $8.94 $9.29 
Tangible common equity (1)$133,583 $128,240 $120,814 $104,935 $108,863 
Cost of total deposits0.88 %0.20 %0.09 %0.04 %0.04 %
Interest and dividends on investment securities exempt from Federal income taxes$1,405 $1,405 $1,534 $1,825 $1,879 
Net interest margin (calculated on a fully tax equivalent basis) (2)3.46 %3.81 %3.80 %3.57 %3.48 %
Return on average assets (3)1.00 %1.15 %1.25 %1.06 %1.07 %
Return on average equity (3)13.60 %15.64 %18.79 %14.42 %14.73 %
Loan to deposit ratio57.07 %59.09 %59.83 %57.28 %53.94 %
Efficiency ratio65.24 %55.46 %49.85 %57.20 %54.20 %
Tier 1 leverage - Bancorp8.51 %8.58 %8.37 %8.26 %7.89 %
Tier 1 leverage - Bank11.04 %11.19 %10.86 %10.73 %9.10 %
Common equity tier 1 - Bancorp12.39 %11.80 %11.92 %11.56 %11.94 %
Common equity tier 1 - Bank16.46 %15.77 %15.87 %15.41 %14.15 %
Tier 1 risk-based capital - Bancorp12.68 %12.09 %12.22 %11.86 %12.26 %
Tier 1 risk-based capital - Bank16.46 %15.77 %15.87 %15.41 %14.15 %
Total risk-based capital - Bancorp15.73 %15.08 %14.92 %14.54 %15.07 %
Total risk based capital - Bank17.44 %16.75 %16.53 %16.03 %14.78 %
(1) Non-GAAP measure. Tangible common equity equals totals shareholder’s equity minus goodwill and core deposit intangible.
(2) Net Interest Margin is computed by dividing annualized quarterly net interest income by quarterly average interest-bearing assets.
(3) Computed by annualizing quarterly net income.
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Central Valley Community Bancorp -- page 14
CENTRAL VALLEY COMMUNITY BANCORP
SCHEDULE OF AVERAGE BALANCES AND AVERAGE YIELDS AND RATES
(Unaudited)

 For the Three Months Ended
June 30, 2023		For the Three Months Ended
March 31, 2023		For the Three Months Ended
June 30, 2022
(Dollars in thousands)Average
Balance		Interest
Income/
Expense		Average
Interest
Rate		Average
Balance		Interest
Income/
Expense		Average
Interest
Rate		Average
Balance		Interest
Income/
Expense		Average
Interest
Rate
ASSETS      
Interest-earning deposits in other banks$107,134 $1,373 5.13 %$6,882 $75 4.36 %$33,067 $53 0.64 %
Securities
Taxable securities765,304 5,826 3.05 %783,938 5,886 3.00 %945,210 5,651 2.39 %
Non-taxable securities (1)256,624 1,779 2.77 %257,452 1,778 2.76 %274,217 2,378 3.47 %
Total investment securities1,021,928 7,605 2.98 %1,041,390 7,664 2.94 %1,219,427 8,029 2.63 %
Total securities and interest-earning deposits1,129,062 8,978 3.18 %1,048,272 7,739 2.95 %1,252,494 8,082 2.58 %
Loans (2) (3)1,257,984 17,382 5.54 %1,260,178 16,508 5.31 %1,085,887 12,883 4.76 %
Total interest-earning assets2,387,046 $26,360 4.43 %2,308,450 $24,247 4.26 %2,338,381 $20,965 3.60 %
Allowance for credit losses(15,317)  (14,759)(9,870)  
Non-accrual loans—   — 280   
Cash and due from banks26,467   27,574 33,050   
Bank premises and equipment9,392   8,072 8,132   
Other assets93,936   86,303 71,989   
Total average assets$2,501,524   $2,415,640 $2,441,962   
LIABILITIES AND SHAREHOLDERS’ EQUITY      
Interest-bearing liabilities:      
Savings and NOW accounts$476,398 $158 0.13 %$526,232 $92 0.07 %$600,685 $34 0.02 %
Money market accounts547,452 2,423 1.78 %468,166 837 0.73 %520,224 164 0.13 %
Time certificates of deposit225,638 2,292 4.07 %68,650 75 0.44 %89,107 33 0.15 %
Total interest-bearing deposits1,249,488 4,873 1.56 %1,063,048 1,004 0.38 %1,210,016 231 0.08 %
Other borrowed funds69,653 911 5.23 %124,480 1,558 5.01 %78,435 424 2.16 %
Total interest-bearing liabilities1,319,141 $5,784 1.76 %1,187,528 $2,562 0.87 %1,288,451 $655 0.20 %
Non-interest bearing demand deposits963,104   1,018,210 947,724   
Other liabilities34,492   31,591 28,091   
Shareholders’ equity184,787   178,311 177,696   
Total average liabilities and shareholders’ equity$2,501,524   $2,415,640 $2,441,962   
Interest income and rate earned on average earning assets $26,360 4.43 %$24,247 4.26 % $20,965 3.60 %
Interest expense and interest cost related to average interest-bearing liabilities 5,784 1.76 %2,562 0.87 % 655 0.20 %
Net interest income and net interest margin (4) $20,576 3.46 %$21,685 3.81 % $20,310 3.48 %

(1)    Calculated on a fully tax equivalent basis, which includes Federal tax benefits relating to income earned on municipal bonds totaling $374, $373, and $499 at June 30, 2023, March 31, 2023, and June 30, 2022, respectively.
(2)    Loan interest income includes loan fees of $26 and $226 at June 30, 2023 and June 30, 2022, respectively, and loan costs of $260 at March 31, 2023.
(3)    Average loans do not include non-accrual loans but do include interest income recovered from previously charged off loans.
(4)    Net interest margin is computed by dividing net interest income by total average interest-earning assets.












Central Valley Community Bancorp -- page 15
CENTRAL VALLEY COMMUNITY BANCORP
SCHEDULE OF AVERAGE BALANCES AND AVERAGE YIELDS AND RATES
(Unaudited)

 For the Six Months Ended
June 30, 2023		For the Six Months Ended
June 30, 2022
(Dollars in thousands)Average
Balance		Interest
Income/
Expense		Average
Interest
Rate		Average
Balance		Interest
Income/
Expense		Average
Interest
Rate
ASSETS      
Interest-earning deposits in other banks$57,285 $1,449 5.06 %$81,204 $109 0.27 %
Securities
Taxable securities774,569 11,712 3.02 %913,481 10,176 2.23 %
Non-taxable securities (1)257,036 3,557 2.77 %265,459 4,201 3.17 %
Total investment securities1,031,605 15,269 2.96 %1,178,940 14,377 2.44 %
Total securities and interest-earning deposits1,088,890 16,718 3.07 %1,260,144 14,486 2.30 %
Loans (2) (3)1,259,075 34,159 5.47 %1,051,772 25,044 4.80 %
Total interest-earning assets2,347,965 $50,877 4.37 %2,311,916 $39,530 3.45 %
Allowance for credit losses(13,117)  (9,851)  
Non-accrual loans—   345   
Cash and due from banks27,017  42,713   
Bank premises and equipment8,735  8,218   
Other assets90,142  97,603   
Total average assets$2,460,742   $2,450,944   
LIABILITIES AND SHAREHOLDERS’ EQUITY      
Interest-bearing liabilities:      
Savings and NOW accounts$501,177 $252 0.10 %$589,785 $68 0.02 %
Money market accounts508,028 3,259 1.29 %531,383 347 0.13 %
Time certificates of deposit147,577 2,365 3.23 %88,262 68 0.16 %
Total interest-bearing deposits1,156,782 5,876 1.02 %1,209,430 483 0.08 %
Other borrowed funds96,915 2,468 5.09 %59,062 757 2.56 %
Total interest-bearing liabilities1,253,697 $8,344 1.34 %1,268,492 $1,240 0.20 %
Non-interest bearing demand deposits990,505   944,362  
Other liabilities33,050   33,538  
Shareholders’ equity183,490   204,552  
Total average liabilities and shareholders’ equity$2,460,742   $2,450,944  
Interest income and rate earned on average earning assets $50,877 4.37 % $39,530 3.45 %
Interest expense and interest cost related to average interest-bearing liabilities 8,344 1.34 % 1,240 0.20 %
Net interest income and net interest margin (4) $42,533 3.65 % $38,290 3.34 %

(1)    Calculated on a fully tax equivalent basis, which includes Federal tax benefits relating to income earned on municipal bonds totaling $747 and $882 at June 30, 2023 and June 30, 2022, respectively.
(2)    Loan interest income includes loan fees of $36 and $490 at June 30, 2023 and June 30, 2022, respectively.
(3)    Average loans do not include non-accrual loans but do include interest income recovered from previously charged off loans.
(4)    Net interest margin is computed by dividing net interest income by total average interest-earning assets.




CONTACTS: Investor Contact:                 Media Contact:
Shannon Avrett                Debbie Nalchajian-Cohen
Executive Vice President, Chief Financial Officer    Marketing Director
Central Valley Community Bancorp        Central Valley Community Bancorp
916-235-4617                    559-222-1322

v3.23.2
Cover
Jul. 20, 2023
Cover [Abstract]  
Document Type 8-K
Document Period End Date Jul. 20, 2023
Entity Registrant Name Central Valley Community Bancorp
Entity Incorporation, State or Country Code CA
Entity File Number 000-31977
Entity Tax Identification Number 77-0539125
Entity Address, Address Line One 7100 N. Financial Dr., Ste. 101
Entity Address, City or Town Fresno
Entity Address, State or Province CA
Entity Address, Postal Zip Code 93720
City Area Code 559
Local Phone Number 298-1775
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0001127371
Title of 12(b) Security Common Stock, no par value
Trading Symbol CVCY
Security Exchange Name NASDAQ
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