Welcome to MVB
MVB Financial Corp. is the bank holding company for MVB Bank, Inc. We provide community banking
services in the Berkeley, Harrison, Jefferson, Marion and Monongalia Counties of West Virginia. We offer a
wide range of deposit products including checking, money market, savings accounts, our enhanced Kasasa
Cash and Kasasa Saver accounts, and time certificates of deposit. In addition, we recently launched our
new Wealth Management Solutions service.
MVB is an active business partner when it comes to commercial and consumer loans, offering an array of
loan products for commercial development and real estate, capital needs, and agricultural loans, as well
as personal loans, residential real estate loans, home equity lines of credit, and construction mortgages.
We offer many other personalized and automated services in our branch locations, online and by phone.
MVB commenced operations in 1999 and is based in Fairmont, West Virginia. Most importantly, we
consider the communities we serve and our relationships with all of our clients to be our most valuable
assets. Visit us at www.mvbbanking.com.
Vision, Mission & Values
VISION
A valued partner in growing strong communities
VALUES
Extraordinary Service
MISSION
A proactive community partner providing quality
financial products and services that go beyond a typical
bank through recognized extraordinary service and
valued relationships
on the coVer
Integrity
Accountability
Teamwork
Respect
Honesty
Community
White water rafting is a sport enjoyed in West Virginia because of its challenges and unpredictable excitement - one
minute you’re paddling along a peaceful calm stretch of the Gauley River, enjoying the scenery of our beautiful
mountains - the next moment you’re shooting through rocks, boulders and down water falls, hanging on for dear life.
Without skillful navigation, good direction of the raft’s guide, and the collective efforts of the whole crew, a tumble
into the water is possible. Metaphorically, the 2011 Annual Report cover symbolizes through nature MVB’s successful
navigation of the choppy and often difficult financial and economic ‘rapids’ of the past several years. The journey
challenged the discipline and focus of MVB’s entire team, who not only successfully traversed the highly difficult passages, but emerged stronger and ready for
future opportunities in all waters.
Selected Financial Highlights
MVB has posted progressive increases for each of the past four years in these selected indicators of growth and development.
The graphs below depict the strength of MVB Bank’s performance in the communities we serve. Compared to the previous year,
MVB’s total deposits increased by 30%, with total assets growing by nearly 29%, on a 27% increase in total loans during 2011.
Net income jumped by nearly 21% from the previous year.
TOTAL LOANS
TOTAL DEPOSITS
$373,822
$294,044
$203,241
$232,847
)
s
d
n
a
s
u
o
h
t
(
$500,000
$400,000
$300,000
$200,000
$100,000
$-
$390,545
$264,531
$300,434
)
s
d
n
a
s
u
o
h
t
(
$500,000
$400,000
$300,000
$200,000
$173,065
$100,000
$-
Dec 2008
Dec 2009
Dec 2010
Dec 2011
Dec 2008
Dec 2009
Dec 2010
Dec 2011
TOTAL ASSETS
NET INCOME
$600,000
$500,000
$400,000
)
s
d
n
a
s
u
o
h
t
(
$533,481
$414,267
$352,762
$300,000
$258,706
$200,000
$100,000
$-
)
s
d
n
a
s
u
o
h
t
(
$3,500
$3,000
$2,500
$2,000
$1,500
$1,000
$500
$-
$2,702
$2,237
$1,406
$828
Dec 2008
Dec 2009
Dec 2010
Dec 2011
Dec 2008
Dec 2009
Dec 2010
Dec 2011
Following a record high stock price at the end of 2011, MVB’s stock has outperformed the S&P 500 and the major bank index
KBW with a compounded annual growth rate of 8.9%.
MVB STOCk PErfOrMANCE VS. S&P 500 & kBW BANk INDEx
1
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0
2
r
e
b
m
e
c
e
D
n
i
d
e
t
s
e
v
n
I
0
0
0
,
0
1
$
f
o
e
u
a
V
l
$25,000
$20,000
$15,000
$10,000
$5,000
$-
MVB
$23,491
8.9%
S&P 500
$10,726
0.7%
KBW Bank Index
$4,471
-7.7%
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Growth rate is calculated as the compound annual growth rate using end of December stock prices and index values unless otherwise noted. Stock and cash dividends are included for MVB. Source: MVB documents; Yahoo! Finance for S&P 500 and KBW Bank Index.
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Successfully Navigating Challenging Waters
Dear Shareholders, Teammates and Friends:
As I write this letter, the flow of economic news appears to be
calming the streams of uncertainty and negativity, contemplating
smoother waters for financial institutions, especially U.S. banks,
going forward. Yet, recent history suggests that there can yet be
eddies and unsettling times brought on by the confluence of
changes both globally and here at home. The positive news is how
well Your Most Valuable Bank has navigated the most challenging
and heaviest waters of our lifetime.
rEADINg ThE WATErS
LArry f. MAzzA, CEO
The past several years have upset many financial institutions, who failed to read the waters correctly, made maneuvering
mistakes and perhaps, were too cautious. MVB never took for granted the seriousness of the situation, continually assessing
what was directly ahead, always steering to less dangerous currents, while searching the most advantageous forward route.
Now, despite settling waters on the surface, MVB continues to move swiftly to ensure our momentum is sustained. Reading
the current bank climate, local is the new global. Across the country, community banks are successfully differentiating
themselves from other types of banks. This includes local ownership and control, products and services tailored to local
markets and clients, speed of decision making, the ability to form a personal connection with clients and the capacity to
leverage local knowledge and relationships to garner new clients. MVB excels in all of these.
NAVIgATINg ThE WATErWAyS
MVB purposefully planned in advance and throughout the 2011 voyage, so that all our “rafts” were well equipped and fully
ready. My observations are that we avoided credit quality issues by approaching our lending, not only from credit score values,
but also by knowing the clients. Basing our lending on the individual, through building trusting relationships that last beyond
the signing of a loan document, is how we operate. While to some extent we are fortunate to be in strong markets, we also
rOgEr TurNEr, COMMErCIAL LENDINg
“Lending money is not an exact science, especially during tough
economic times. MVB kept its lending philosophy simple – first
and foremost, know the client, be consistent and find lending
solutions that work for the client, while protecting the bank’s
best interest.”
held to a discipline that sought out more of the best
opportunities, instead of just taking every available
lending opportunity. We focused on diversity in size
of loans and the markets in which we lent, not relying
on one model or one place. We never compromised on
hiring the absolute best people to be part of our team.
We even did so when the right person was available with the right skills and experience, often in advance of proven need.
An example is when this past year we ramped up the mortgage business landing a strong mortgage lending team in Morgan-
town to help create new channels to take MVB to the next level of mortgage loans production. This, along with advance
development of a dedicated loan processing operations center, has led to a significantly increased presence in the retail
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mortgage market in a short time period. Most importantly, we demonstrated our mission by helping more people with home
ownership than most other financial institutions in West Virginia. All in all, we stayed on course by using a ‘people first’ focus
to guide us. You will see on these few pages messages from some of our senior management team members reflecting on how
we maneuvered amid the challenging narrow chutes and rough rapids over the past several years. I remain pleased in how
MVB continued to navigate uncertain times with the
right focus and execution that brought strong perfor-
mance and a continued effective building of a solid
foundation for future growth. I attribute the majority of
our success in these endeavors to the very talented MVB
Team, who, in each area of operation and at every level
JOy kNIghT, MOrTgAgE LENDINg
“During the unsettling times, rather than stand on the sidelines,
we continued to build our capabilities and capacity to stay active
in the mortgage marketplace.”
of the organization, helped steer MVB’s top notch performance in 2011. The MVB Team is well-balanced, steady and prepared
to handle any emerging hurdles or opportunities. Before offering our future navigation plan, I reflect on the financial highlights
of our 2011 journey.
CELEBrATINg Our 2011 JOurNEy
In every area of our operations, MVB delivered a solid performance in 2011. A few highlights include:
• Loans increased $79.8 million or 27% over 2010.
• Total assets increased $119.2 million or 29% from previous year, mainly the result of the increased loan and
investment portfolios.
• Total deposits increased $90.1 million or 30% from 2010.
• Stockholders’ equity increased $17.0 million or a 55% increase from the previous year.
• Net Income increased $465,000 or a 21% increase from 2010.
Listed separately in this report are key milestones of the notable achievements made during 2011 beyond the excellent financial results.
PLOTTINg Our COurSE
The MVB Team continues to chart its course based on the economy, our own experience and knowing our markets. Our regional
economy is showing signs of strength. MVB is located in the sweet spot of the Marcellus natural gas play. Over the longer
term, this will continue to be important to us regardless of energy commodity pricing. West Virginia University continues
to be an economic engine, growing in size, programs, research scope and with a large healthcare presence contributing to
the Morgantown area’s continued expansion. West
Virginia’s Eastern Panhandle is showing positive signs
of recovery with several national companies build-
ing facilities in these markets. We will continue to
be proactive in taking advantage of these and other
developmental opportunities that are clearly in our
JIM rODgErS, COMMErCIAL LENDINg EAST
“All MVB teammates were committed to finding ways to identify
new, quality clients and assisting existing clients with a high level
of personal service. This resulted in expanded relationships, with
multiple financial products provided to the individuals we helped.”
footprint. However, as credit lending loosens, and the larger, national and regional banks become more aggressive in the lending
arena, MVB must be prepared to stay ahead of the competition. We must not waiver from what has made us successful, yet we
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must continue to be innovative in our products, services and lending practices. Further, to advance growth, we need to continue
building a motivated team that ensures the most effective and efficient support system for executing our plan. To this point, the
following summarizes our highest priority focus areas for 2012. Although fully addressed in our updated strategic plan, Building
Bank Value, 2012-2016, the following summary represents the underlying foundation for our work ahead:
1. CuLTIVATE A hEALThy, TALENTED TEAM ThAT IS rEWArDED fOr PErfOrMANCE
Our teammates are one of MVB’s most valuable assets. Without quality talent working in every area of MVB, our results to date
DON rOBINSON, COMMErCIAL LENDINg NOrTh
“Most banks used the struggling national economy and increased
regulatory pressures as excuses to slow down their growth and
increase fees. At MVB, we understood our markets and the needs
of our clients, so during the challenging times we forged ahead,
expanded into Morgantown, recruited great talent and reported
strong results.”
would not have been possible. We will continue our efforts
to ensure that our team members have an excellent work
environment, are appropriately skilled in their areas of
expertise, and are given the resources needed to perform.
2. ENSurE TOP grOWTh AND SOLID PrOfITABILITy
While looking to future growth and opportunities, we cannot lose sight of the vital importance of ensuring all of our
operations are performing at high levels and fully contributing to MVB’s profitability. Focus on the East and newly established
North operations remains clearly in our sights to do all we can to ensure growth and profitability. Both areas have significant
opportunities for us to grow our client base, increase loans and gain revenues.
3. SuCCEED IN grOWINg MEANINgfuL DEPOSITS
The key ingredient for any bank to significantly add value rests in its ability to grow net deposits month in and month out.
The dynamics associated with management and growth of deposits creates challenges that MVB must effectively navigate to
DAVID JONES, CrEDIT AND rISk
“Throughout the period of tightened or little credit, MVB never
wavered from its well-established and effective credit risk analysis
practices designed to ensure the highest level of quality prevailed,
while still actively lending in our markets.”
reach the level of success we envision. Deposits are
everyone’s business at MVB.
4. MAxIMIzE LOAN grOWTh WIThIN hIgh CrEDIT
QuALITy STANDArDS
The commercial, mortgage and retail lending teams are key
to reaching our loan volume targets. We are fortunate to have very talented professionals in each of these areas. In all aspects of lending,
we must work diligently to maintain a quality balance sheet and meet all compliance and regulatory requirements that reflect positively
on our financial strength and stability in all our lending areas. Driving strong organic growth coupled with increased operational
efficiency is our equation to increase shareholder value.
5. ACT ON NEW grOWTh OPPOrTuNITIES & DIVErSIfIED rEVENuE OPTIONS
During the planning with the Board this year, agreement was reached to become more active in pursuing opportunities in both
merger and acquisition endeavors. Specifically, we will remain vigilant and agile for acquisition opportunities that align with MVB’s
vision and strategic direction. We will continue to diversify our sources of revenue with an emphasis on non-interest ones. For exam-
ple, late in 2011, we established a wealth management services unit under the banner of MVB Wealth Management Solutions (WMS)
dedicated to supporting the financial management interests of high net worth individuals, families and small business owners.
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6. BuILD MVB’S rETAIL BANkINg OPErATIONS ThAT SuSTAIN DEEPEr CLIENT BANkINg rELATIONShIPS AND LOyALTy
As MVB expands into new areas and looks to increase business in existing facilities, we are building the best retail banking
operation that fully supports all lending areas and deepens existing and new client banking relationships. This will also assist
us with our deposit growth initiatives. Client service is a true competitive edge for any organization. With many banks claiming
superior service, MVB has to continually review how it delivers client service that is second to none. That means, being leaders
in client service, not followers, in the marketplace.
7. ENSurE MVB IS OrgANIzED EffECTIVELy TO
DrIVE CONSISTENT hIgh PErfOrMANCE
We must match our aggressive growth with a com-
mensurate and appropriate level of support services
JOhN SChIrrIPA, COMMErCIAL LENDINg CENTrAL
“MVB has been fortunate to have a seasoned, community-based
team who understands how to do banking within our communi-
ties, always being sensitive to community needs and those of each
client in our service area.”
and infrastructure. We will invest in necessary technology and tools and enhance internal compliance, marketing, opera-
tions, back office support, and training in alignment with our growth plan. We’re focused on how to best manage our central
functions to ensure that MVB fully leverages our internal resources, including our ability to develop internal capacity to scale
quickly when opportunities arise (organic expansion, M&A). Similarly, we are assessing how to best structure and operate our
corporate and regional Boards in order to optimize their talent in the most effective manner.
Although we are pleased with our 2011 results, our attention is clearly on the waters in front of us and in strengthening our
capacity and abilities for traversing whatever comes our way. While I cannot predict the future, I am confident MVB has been
diligent in planning and plotting a course that best prepares us to be leaders in community banking. As I enter my fourth year
as CEO, I remain extremely appreciative of my Team-
mates, the Board of Directors and shareholders who
have entrusted me and the excellent management team
to steer MVB in such a way as to put us in the forefront
of successful community banking. Having such exper-
tise and experience beside me at the helm has made all
ErIC TIChENOr, fINANCE AND INVESTMENTS
“From the financial perspective, MVB used a conservative,
quality first approach to grow earnings. We took advantage of
opportunities to deploy our excess capital into sound investment
strategies that allowed us the flexibility to build our loan portfolio
when opportunities became available and continue to expand
our operations without sacrificing the yield, quality or cash flow
of the portfolio.”
the difference. We remain gratified for our many clients, new and old, who entrust their banking needs with us. We pledge to
sustain that trust by being their most valuable “community” bank with the best products and services, bar none!
With Kindest Regards and Gratitude,
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Larry F. Mazza, CEO
2011 Milestones
• Expanded geographically (North) through opening an MVB Office in Morgantown,
West Virginia to serve the surrounding areas with commercial and home
mortgage lending; received approval by bank regulators to open a full service
community bank in the Morgantown area and started location identification work.
• Opened MVB’s first separate dedicated Operations Center in Bridgeport,
West Virginia.
• Increased capital by an additional $8.3 million from completing a highly
successful offering to accredited investors started in late 2010, with $6.6 million
of the total finalized in early 2011.
• Received $8.5 million in capital from the Small Business Lending Fund (SBLF).
Only healthy community banks with positive track records were selected to
receive this funding.
• Established MVB’s Wealth Management Solutions, a financial and investment
advisory service.
• Issued a 10% stock dividend declared in January 2011, and paid a ten cent per
share cash dividend, a 10% increase over 2010 based on the stock dividend paid
in 2011.
• Achieved a record high stock price value for MVB shares in 2011.
• Earned the 5-Star Superior rating from Bauer Financial, Inc. This 3rd
party, objective award is an important industry standard that places
MVB in a special group of banks and speaks to MVB’s safety, sound-
ness and financial strength.
• Managed successfully, and better than its peers, a lower level of non-performing
loans and charge-offs to total loans.
• Launched TeamVoice as a way to listen to and more fully engage every MVB team
member ensuring a positive, healthy working environment
with a culture of continuous improvement.
• Welcomed new directors, James Cava, Managing Member of Cava & Banko,
PLLC, to the Central Board, and two MVB senior leaders, Roger Turner to the
MVB Financial Corp. Board and John Schirripa to the Central Board.
• Implemented MVB Wellness Works, a comprehensive bank-wide
wellness program for all teammates.
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Listening To Our Clients
It’s a win-win – we get better by responding to our clients’ input, and they receive
products and services that better match their needs. When MVB began our
ClientVoice program, we hoped we would hear not just good news, but helpful
input into how we could better serve our clients. That’s exactly what we’ve
received and we’ve been able to respond with better products and services. Below
is a sample of the type of input our clients have voiced and how we responded.
Weekend Hours for Client ConvenienCe
online banking Could be easier
One client whose schedule makes banking on weekends
We heard from a range of clients that our online banking
essential wished that our Fairmont lobby was open on Satur-
was not as user friendly as we intended. So we’re making it
days. Our response: We’ll meet you in person with a special
easier for everyone. In April 2012, we’re launching a brand
appointment on Saturdays! We are delighted to be able to
new online banking experience that will set the bank apart
service clients individually when it’s convenient for them.
from the competition.
Coffee Warms up our lobbies
Customer serviCe great all over tHe state
Many clients are enjoying the coffee bars we’ve added to the
A client that used to live in Fairmont and moved to the
branches and the hospitality and friendliness that goes along
Eastern Panhandle noted that MVB’s customer service was
with the coffee. Some of our branch lobbies are community
great no matter the location.
gathering spots for some of our regular clients and we’re
happy to host them each and every day.
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TM
MVB Cares About Our Communities
As a bank, and as a group of dedicated teammates, MVB invests time, expertise and money in organiza-
tions across our communities. Our teammates offer financial expertise to nonprofit boards and give their
time and talents to help local charities do their important daily work. Our reach extends from youth
and high school sports teams, to community health, local festivals and economic development projects.
We also support many educational initiatives and recently embarked on a program known as
MoneyIsland,™ an entertaining online world for kids that encourages financial literacy with units on:
Saving & Spending, Earning & Investing and Using Credit Wisely. The program was created by master
teachers to align with national standards published by the Jump$tart Coalition for Personal Financial
Literacy. To date, we’ve helped more than 2,000 middle school students in our communities get on board
with MoneyIsland. We recognize that engaging with people and nonprofit organizations is key to
keeping our communities vibrant and that’s why we make community involvement a cornerstone of
our culture. Our vision is to be a valued partner in growing strong communities.
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Do You Kasasa?
MVB does and we’re the first bank in West Virginia to do so.
Thousands of MVB clients have been enjoying the
interest when they meet certain qualifications.
most innovative checking and savings accounts
Being part of Kasasa affords access to a portfolio of
available from a financial institution, anywhere.
products and services in the future. For example,
These common services, most frequently used by
there can be products made available that appeal
banking consumers, truly set MVB apart from its
to specific age groups or lifestyles that all center
peers, including the bigger banks – who are adding
fees, not saving their clients from nuisance fees such
on the Kasasa branding. Through Kasasa, MVB
also taps into collaborative funding for market
as charges at ATM machines. The Kasasa concept
research and advertising designed to reach exist-
and its focused execution will benefit our clients
ing and new clients. Kasasa, and its exclusive focus
and MVB. In early 2012, MVB became part of
Kasasa which is a growing national brand and
on community banks, has a proven track record.
Banks using Kasasa in other states have shown
promotion movement. MVB joins a growing network
improvements in deposit growth and in growing
of community banks nationwide under the Kasasa
their client base. MVB is committed to leverage the
brand to deliver innovative products that set the
most from the Kasasa initiative by increasing the
participating banks apart from others. It’s a new
number of people who DO Kasasa in our markets.
name for a new way of banking. Kasasa is targeted
Join the crowd and come Kasasa with us!
to significantly increase the message about the value
of the products MVB has already been offering.
Thus, our Most Valuable Checking will be changed
to Kasasa Cash. Similarly, our Most Valuable
Savings account will now be called Kasasa Saver.
The names may change, but the accounts remain
exactly the same - clients are rewarded with greater
ka • sa • sa PrONuNCIATION: (kAh-SAh-SAh) IT’S a neW WorD For
a neW DaY. a neW WaY To PuT Your MoneY Where Your PaSSIon IS. a neW equaTIon: You + real choIceS
For Your MoneY + aMerIca’S FIneST coMMunITY BanKS anD creDIT unIonS. BeYonD rIGID olD WaYS To
a neW era oF choIce - chooSInG WhaT You WanT FIrST, Then Where You WanT IT. KaSaSa creaTeS Free
checKInG anD SaVInGS accounTS ThaT GIVe BacK To You In ToTallY neW WaYS. Do You WanT To Be InSPIreD
BY Your accounT? Do You WanT real choIceS For Your MoneY? IF You KaSaSa You Do.
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S. R. Snodgrass, A.C. • 980 National Road • Wheeling, West Virginia 26003-6400 • Phone: (304) 233-5030 • Facsimile: (304) 233-3062
S. R. Snodgrass, A.C. • 980 National Road • Wheeling, West Virginia 26003-6400 • Phone: (304) 233-5030 • Facsimile: (304) 233-3062
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MVB Financial Corp.
Consolidated Balance Sheets
(Dollars in thousands, except number of shares)
December 31, 2011 and 2010
ASSETS
Cash and due from banks
Interest bearing balances with banks
Certificates of deposit with other banks
Investment Securities:
Securities held-to-maturity, at cost
Securities available-for-sale, at approximate fair value
Loans:
Less: Allowance for loan losses
Net Loans
Loans held for sale
Bank premises, furniture and equipment
Bank owned life insurance
Accrued interest receivable and other assets
2011
2010
$ 9,763
278
9,918
$ 3,713
10,091
17,734
13,568
99,366
7,460
61,824
373,822
(3,045)
370,777
7,147
7,782
8,076
6,806
294,044
(2,478)
291,566
1,839
7,579
5,689
6,772
TOTAL ASSETS
$ 533,481
$ 414,267
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing
Interest bearing
Total Deposits
Accrued interest, taxes, and other liabilities
Repurchase agreements
FHLB and other borrowings
Subordinated debt
Total Liabilities
STOCKHOLDERS' EQUITY
$ 38,632
351,913
390,545
3,478
77,835
9,767
4,124
485,749
$ 28,449
271,985
300,434
2,703
47,623
28,614
4,124
383,498
Preferred stock, par value $1,000; 8,500 and 5,000 shares authorized;
8,500 and 0 shares issued
Common stock, par value $1; 4,000,000 shares authorized;
2,234,767 and 1,802,391 shares issued respectively
Additional paid-in capital
Common stock paid for but not issued, par value $1; 0 and 90,560
shares
Treasury Stock, 51,077 and 47,218 shares, respectively
Retained earnings
Accumulated other comprehensive loss
Total Stockholders' Equity
8,500
-
2,235
32,603
0
(1,084)
6,220
(742)
47,732
1,802
23,864
1,729
(1,006)
4,643
(263)
30,769
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$ 533,481
$ 414,267
See Notes to Consolidated Financial Statements
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MVB Financial Corp.
Consolidated Statements of Income
(Dollars in thousands except Share and Per Share Data)
Years ended December 31, 2011 and 2010
INTEREST INCOME
Interest and fees on loans
Interest on deposits with other banks
Interest on investment securities - taxable
Interest on tax exempt loans and securities
Total interest income
INTEREST EXPENSE
Interest on deposits
Interest on repurchase agreements
Interest on FHLB and other borrowings
Interest on subordinated debt
Total interest expense
NET INTEREST INCOME
Provision for loan losses
Net interest income after provision for loan losses
OTHER INCOME
Service charges on deposit accounts
Income on bank owned life insurance
Visa debit card income
Income on loans held for sale
Gain on sale of securities
Other operating income
OTHER EXPENSES
Salaries and employee benefits
Occupancy expense
Equipment depreciation and maintenance
Data processing
Visa debit card expense
Advertising
Legal and accounting fees
Printing, stationery and supplies
Consulting fees
FDIC insurance
Other taxes
Other operating expenses
2011
2010
$ 16,446
103
1,539
920
19,008
$ 13,468
587
1,427
805
16,287
3,852
503
464
81
4,900
4,401
474
513
82
5,470
14,108
1,723
12,385
10,817
1,100
9,717
660
287
414
957
833
537
3,688
6,717
697
594
412
332
482
632
172
408
368
175
1,370
12,359
658
265
361
634
88
448
2,454
4,796
590
472
392
295
338
167
130
211
523
190
1,035
9,139
Income before income taxes
3,714
3,032
Income tax expense
Net Income
Basic net income per share after preferred dividends
Diluted net income per share after preferred dividends
Basic weighted average shares outstanding
Diluted weighted average shares outstanding
1,012
795
$ 2,702
$ 2,237
$1.24
$1.21
2,147,890
2,194,410
$1.40
$1.38
1,598,432
1,625,884
See Notes to Consolidated Financial Statements
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MVB Financial Corp.
Consolidated Statements of Cash Flows
(Dollars in thousands)
Years ended December 31, 2011 and 2010
OPERATING ACTIVITIES
Net Income
Adjustments to reconcile net income to net cash provided by
operating activities:
Provision for loan losses
Deferred income tax expense/(benefit)
Depreciation
Stock based compensation
Loans originated for sale
Proceeds of loans sold
Proceeds from sale of other real estate owned
Loss/(gain) on sale of other real estate owned
(Gain) on sale of investment securities
Amortization, net of accretion
(Increase) in interest receivable and other assets
Increase in accrued interest, taxes, and other liabilities
NET CASH (USED IN)/PROVIDED BY OPERATING
ACTIVITIES
INVESTING ACTIVITIES
(Increase) in loans made to customers
Purchases of premises and equipment
Purchases of investment securities available-for-sale
Purchases of investment securities held-to-maturity
Decrease/(increase) in deposits with FHLB and Fed, net
Purchases of certificates of deposit with other banks
Proceeds from maturity of certificates of deposit with other banks
Proceeds from sales, maturities and calls of securities available-for-
sale
Proceeds from maturities and calls of securities held-to-maturity
Purchase of bank owned life insurance
NET CASH (USED IN) INVESTING ACTIVITIES
FINANCING ACTIVITIES
Net increase in deposits
Net increase in repurchase agreements
Proceeds from FHLB and other borrowings
Principal payments on FHLB and other borrowings
Purchase of treasury stock
Net proceeds of stock offering
Cash dividend
Common stock options exercised
Issuance of preferred stock
NET CASH PROVIDED BY FINANCING ACTIVITIES
2011
2010
$ 2,702
$ 2,237
1,723
147
466
117
(62,647)
57,339
373
73
(833)
886
(1,489)
775
(368)
(80,934)
(669)
(249,771)
(7,361)
9,813
(9,918)
17,734
212,300
1,225
(2,100)
(109,681)
90,111
30,212
80,104
(98,951)
(78)
6,500
(262)
-
8,463
116,099
1,100
(144)
447
46
(46,657)
46,582
866
(61)
(88)
513
(409)
573
5,005
(62,060)
(269)
(69,602)
(1,359)
(6,156)
(16,321)
48,029
45,082
474
-
(62,182)
35,903
11,982
205,716
(196,300)
(484)
1,729
(160)
183
-
58,569
Increase in cash and cash equivalents
6,050
1,392
Cash and cash equivalents at beginning of period
3,713
2,321
Cash and cash equivalents at end of period
$ 9,763
$ 3,713
Supplemental disclosure of cash flow information
Cash payments for:
Interest on deposits, repurchase agreements and FHLB
borrowings
Income taxes
$ 4,958
$ 1,101
$ 5,623
$ 811
See Notes to Consolidated Financial Statements
33
12
13
MVB Financial
Consolidated Statements of Changes in Stockholders' Equity
Years ended December 31, 2011 and 2010
(Dollars in thousands)
Preferred
Stock
Common
Stock
Additional
Paid-in
Capital
Retained
Earnings
Accumulated
Other
Comprehensive
Income/(loss)
Total
Treasury
Stock
Stockholders'
Equity
Balance, December 31, 2009
Comprehensive income:
$ -
$ 1,629
$ 20,457
$ 5,917
$ (343)
$ (522)
$ 27,138
Net Income
2,237
2,237
Other comprehensive income(loss)
Net fair value adjustment on
securities available for sale,
reclassification adjustment for realized
losses - net of tax effect of $(167)
Total Comprehensive Income
Minimum pension liability adjustment -
net of tax effect of $60
Cash dividends paid ($0.10 per share)
Stock offering in process
Stock based compensation
Stock dividend - 10% stock
Treasury stock, acquired at cost
Common stock options exercised
251
251
2,488
(171)
(171)
(160)
(3,351)
1,729
46
3,191
160
13
170
(160)
1,729
46
(484)
183
(484)
Balance, December 31, 2010
Comprehensive income:
$ -
-
$ 1,802
$ 25,593
$ 4,643
$ (263)
$(1,006)
$ 30,769
Net Income
2,702
2,702
Other comprehensive income(loss)
Net fair value adjustment on
securities available for sale, less
reclassification adjustment for realized
gains - net of tax effect of $(38)
Total Comprehensive Income
Minimum pension liability adjustment -
net of tax effect of $358
Cash dividends paid ($0.10 per share)
Dividends on preferred stock
Stock offering
Preferred stock issued
Stock based compensation
Stock dividend - 10% stock dividend
Treasury stock, acquired at cost
8,500
58
58
2,760
(537)
(537)
(218)
(44)
(6)
(37)
(820)
394
6,112
117
781
39
-
218)
(44)
6,500
8,463
117
(78)
-
(78)
-
Balance, December 31, 2011
$ 8,500
$ 2,235
$ 32,603
$ 6,220
$ (742)
$ (1,084)
$ 47,732
See Notes to Consolidated Financial Statements
34
14
15
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
Note 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Operations
MVB Financial Corp., "the Company", provides banking services to the domestic market with the primary market areas being
the Marion, Harrison, Monongalia, Jefferson and Berkeley counties of West Virginia. To a large extent, the operations of the
Company, such as loan portfolio management and deposit growth, are directly affected by the market area economies.
Cash and Cash Equivalents
Cash and cash equivalents include cash and due from banks with original maturities of ninety days or less.
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of MVB Financial Corp. Inc., and its wholly owned
subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.
Management Estimates
The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates, such as
the allowance for loan losses, are based upon known facts and circumstances. Estimates are revised by management in the
period such facts and circumstances change. Actual results could differ from these estimates.
Investment Securities
Debt securities that management has the ability and intent to hold to maturity are classified as held-to-maturity and carried at
cost, adjusted for amortization of premium and accretion of discounts computed by the interest method from purchase date
to maturity. Other marketable securities are classified as available-for-sale and are carried at fair value. Unrealized gains
and losses on securities available-for-sale, net of the deferred income tax effect, are recognized as direct increases or
decreases in stockholders' equity. Cost of securities sold is recognized using the specific identification method.
Loans Held for Sale
Through Crescent Mortgage Company, Franklin American Mortgage and Freddie MAC, MVB Bank, Inc. has the ability to
offer customers long-term fixed rate mortgage products without holding these instruments in the bank's loan portfolio. MVB
values loans held for sale at the lower of cost or market. After thorough review of the process the Company has concluded
that no material derivative instruments exist, as the bank obtains pricing information directly from the websites of the
secondary mortgage providers and locks in pricing based upon pre-established margins set by management.
Loans and Allowance for Loan Losses
Loans are stated at the amount of unpaid principal reduced by an allowance for loan losses. Loans are considered
delinquent when scheduled principal or interest payments are 31 days past due. Interest income on loans is recognized on
an accrual basis. The allowance for loan losses is maintained at a level deemed adequate to absorb probable losses
inherent in the loan portfolio. The Company consistently applies a quarterly loan review process to continually evaluate
loans for changes in credit risk. This process serves as the primary means by which the Company evaluates the adequacy
of the allowance for loan losses, and is based upon periodic review of the collectibility of loans in light of historical
experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower's ability to repay,
estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it
requires estimates that are susceptible to significant revision as more information becomes available.
The allowance consists of specific and general components. The specific component relates to loans that are impaired. The
general component covers non-classified loans and is based upon historical loss experience adjusted for qualitative factors.
A loan is considered impaired when, based upon current information and events, it is probable that the Company will be
unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan
agreement. Factors considered by management in determining impairment include payment status, collateral value, and the
probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment
delays and shortages generally are not classified as impaired. Generally the Company considers impaired loans to include
loans classified as non-accrual loans and loans past due for longer than 90 days.
14
35
15
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
Loan Origination Fees and Costs
Accounting standards require that loan origination and commitment fees and direct loan origination costs be deferred and
the net amount amortized as an adjustment of the related loan's yield.
Bank Premises, Furniture and Equipment
Bank premises, furniture and equipment are carried at cost less accumulated depreciation. The provision for depreciation is
computed for financial reporting by the straight-line-method based on the estimated useful lives of assets, which range from
7 to 40 years on buildings and leasehold improvements and 3 to 10 years on furniture, fixtures and equipment.
Intangible Assets
The excess of the cost of an acquired company over the fair value of the net assets and identified intangibles acquired is
recorded as goodwill. The net carrying amount of intangible assets was $917 and $927 at December 31, 2011 and 2010,
respectively.
Other Investments
Federal Home Loan Bank (FHLB) stock is recorded at cost and considered to be restricted as the Company is required by
the FHLB to hold this investment, and the only market for this stock is the issuing agency. FHLB stock totaled $1,973 and
$1,816 at December 31, 2011 and 2010, respectively, and is included in other assets in the accompanying balance sheet.
Income Taxes
Deferred income taxes are reported for timing differences between items of income or expense reported in the financial
statements and those reported for income tax purposes. The differences relate principally to accretion of discounts on
investment securities, provision for loan losses, minimum pension liability, and differences between book and tax methods of
depreciation.
Stock Based Compensation
The Company accounts for stock-based compensation in accordance with generally accepted accounting standards. Under
these standards the Company is required to record compensation expense for all awards granted after the date of adoption
and for any unvested options previously granted.
Foreclosed Assets Held for Resale
Foreclosed assets held for resale acquired in satisfaction of mortgage obligations and in foreclosure proceedings are
recorded at the lower of cost or fair value less estimated selling costs at the time of foreclosure, with any valuation
adjustments charged to the allowance for loan losses. Any unrealized gains or losses on sale are then recorded in other
non-interest expense. At December 31, 2011 and 2010, the Company held other real estate of $176 and $402.
Net Income Per Common Share
Diluted net income per common share includes any dilutive effects of stock options, and is computed by dividing net income
by the average number of common shares outstanding during the period less the preferred stock dividend, adjusted for the
dilutive effect of options under the Company's 2003 Stock Incentive Plan.
Comprehensive Income
Accounting principles generally require that recognized revenue, expenses, gains and losses be included in net income.
Although certain changes in assets and liabilities, such as unrealized gains and losses on available-for-sale securities and
minimum pension liability, are reported as a separate component of the equity section of the balance sheet, such items,
along with net income, are components of comprehensive income.
Bank-owned life insurance
Bank-owned life insurance ("BOLI") represents life insurance on the lives of certain Company employees who have provided
positive consent allowing the Company to be the beneficiary of such policies. These policies are recorded at their cash
surrender value, or the amount that can be realized upon surrender of the policy. Income from these policies is not subject
to income taxes and is recorded as other income.
Advertising Costs
Advertising costs are expensed as incurred.
35
16
17
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
Transfers of Financial Assets
Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. Control over
transferred assets is deemed to be surrendered when (i) the assests have been isolated from the company, (ii) the
transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the
transferred assets, and (iii) the Company does not maintain effective control over the transferred assets through an
agreement to repurchase them before their maturity.
Reclassifications
Certain amounts in the 2010 financial statements have been reclassified to conform to the 2011 financial statement
presentation.
NOTE 2. INVESTMENT SECURITIES
Amortized cost and approximate fair values of investment securities held-to-maturity at December 31, 2011, including gross
unrealized gains and losses, are summarized as follows:
(Dollars in thousands)
Amortized
Cost
Unrealized
Gain
Unrealized
Loss
Approximate
Fair
Value
Municipal securities
13,568
$ 13,568
587
$ 587
(11)
$ (11)
14,144
$ 14,144
Amortized cost and approximate fair values of investment securities held-to-maturity at December 31, 2010, including gross
unrealized gains and losses, are summarized as follows:
Amortized
Cost
Unrealized
Gain
Unrealized
Loss
Approximate
Fair
Value
Municipal securities
U. S. Agency securities
6,460
1,000
$ 7,460
27
17
(62)
-
6,425
1,017
$ 44
$ (62)
$ 7,442
Amortized cost and approximate fair values of investment securities available-for-sale at December 31, 2011 are summarized
as follows:
Amortized
Cost
Unrealized
Gain
Unrealized
Loss
Approximate
Fair
Value
U. S. Agency securities
Mortgage-backed securities
Other securities
$ 51,165
47,319
124
$ 98,608
$ 710
198
-
$ 908
$ (1)
(149)
-
$ 51,874
47,368
124
$ (150)
$ 99,366
Amortized cost and approximate fair values of investment securities available-for-sale at December 31, 2010 are summarized
as follows:
Amortized
Cost
Unrealized
Gain
Unrealized
Loss
Approximate
Fair
Value
U. S. Agency securities
Mortgage-backed securities
Other securities
$ 34,903
26,135
124
$ 61,162
$ 453
306
-
$ 759
$ (76)
(21)
-
$ 35,280
26,420
124
$ (97)
$ 61,824
16
35
17
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
The following tables summarize amortized cost and approximate fair values of securities by maturity:
Held to Maturity
Available for sale
December 31, 2011
Amortized
Cost
$ 115
-
4,650
8,803
$ 13,568
Approximate
Fair
Value
$ 115
-
4,934
9,095
$ 14,144
Amortized
Cost
Approximate
Fair
Value
$ -
34,130
20,302
44,176
$ -
34,795
20,280
44,291
$ 98,608
$ 99,366
Within one year
After one year, but within five
After five years, but within ten
After ten Years
Total
Investment securities with a carrying value of $94,866 and $66,426 at December 31, 2011 and 2010, respectively, were pledged
to secure public funds, repurchase agreements and potential borrowings at the Federal Reserve discount window.
The Company's investment portfolio includes securities that are in an unrealized loss position as of December 31, 2011, the
details of which are included in the following table. Although these securities, if sold at December 31, 2011 would result in a
pretax loss of $161, the Company has no intent to sell the applicable securities at such market values, and maintains the
Company has the ability to hold these securities until all principal has been recovered. Declines in the market values of these
securities can be traced to general market conditions which reflect the prospect for the economy as a whole. When determining
other-than-temporary impairment on securities, the Company considers such factors as adverse conditions specifically related to
a certain security or to specific conditions in an industry or geographic area, the time frame securities have been in an unrealized
loss position, the Company's ability to hold the security for a period of time sufficient to allow for anticipated recovery in value,
whether or not the security has been downgraded by a rating agency, and whether or not the financial condition of the security
issuer has severely deteriorated. As of December 31, 2011, the Company considers all securities with unrealized loss positions
to be temporarily impaired, and consequently, does not believe the Company will sustain any material realized losses as a result
of the current temporary decline in market value.
The following table discloses investments in an unrealized loss position:
At December 31, 2011, total temporary impairment totaled $161.
Description and number
Less than 12 months
12 months or more
of positions
Fair Value
Unrealized
Loss
Fair Value
Unrealized Loss
U.S. Agencies (1)
Mortgage-backed securities (16)
Municipal securities (3)
$ 4,999
31,073
936
$ (1)
(128)
(11)
$ 37,008
$ (140)
$ -
3,124
-
$ 3,124
$ -
(21)
-
$ (21)
NOTE 3. LOANS
The components of loans in the balance sheet at December 31, were as follows:
(Dollars in thousands)
Commercial and non-residential real estate
Residential real estate
Consumer and other
Net deferred fees and costs
2011
2010
$ 231,030
128,683
13,782
327
$ 373,822
$ 194,605
86,020
13,324
95
$ 294,044
18
19
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
Changes in the allowance for loan losses were as follows for the years ended December 31:
(Dollars in thousands)
Balance at beginning of period
Losses charged to allowance
Recoveries credited to allowance
Provision for loan losses
Balance at end of period
2011
2010
$ 2,478
(1,189)
33
1,723
$ 2,241
(912)
49
1,100
$ 3,045
$ 2,478
The following table summarizes the primary segments of the loan portfolio as of December 31, 2011 and 2010 (in thousands):
Commercial
Residential
Home
Equity
Installment
Credit
Cards
Total
December 31, 2011
Total Loans
$231,357
$112,753
$15,930
$13,217
$565
$373,822
Individually evaluated for impairment
$2,597
$76
$9
$140
$0
$2,822
Collectively evaluated for impairment
$228,760
$112,677
$15,921
$13,077
$565
$371,000
December 31, 2010
Total Loans
$194,700
$71,686
$14,334
$12,830
$494
$294,044
Individually evaluated for impairment
$393
$197
$262
$0
$4
$856
Collectively evaluated for impairment
$194,307
$71,489
$14,072
$12,830
$490
$293,188
Management evaluates individual loans in all of the commercial segments for possible impairment. Loans are considered to be
impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled
payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by
management in evaluating impairment include payment status, collateral value, and the probability of collecting scheduled
principal and interest payments when due. Management determines the significance of payment delays and payment shortfalls
on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the
length of the delay, the reasons for the delay, the borrower's prior payment record, and the amount of the shortfall in relation to
the principal and interest owed. The Company also separately evaluates individual consumer and residential mortgage loans for
impairment.
Once the determination has been made that a loan is impaired, the determination of whether a specific allocation of the allowance
is necessary is measured by comparing the recorded investment in the loan to the fair value of the loan using one of three
methods: (a) the present value of expected future future cash flows discounted at the loan's effective interest rate; (b) the loan's
observable market price; or (c) the fair value of the collateral less selling costs. The method is selected on a loan-by-loan basis,
with management primarily utilizing the fair value of collateral method. The evaluation of the need and amount of a specific
allocation of the allowance and whether a loan can be removed from impairment status is made on a quarterly basis.
18
19
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
The following table presents impaired loans by class, segregated by those for which a specific allowance was required and those
for which a specific allowance was not necessary as of December 31, 2011 and 2010 (in thousands):
Impaired Loans with
Specific Allowance
Impaired
Loans with
No
Specific
Allowance
Total Impaired Loans
December 31, 2011
Commercial
Residential
Home Equity
Installment
Credit Card
Total impaired loans
December 31, 2010
Commercial
Residential
Home Equity
Installment
Credit Card
Total impaired loans
Recorded
Investment
Related
Allowance
Recorded
Investment
Recorded
Investment
$2,597
76
9
140
0
$2,822
$59
165
262
0
4
$490
$758
10
9
100
0
$877
$20
75
99
0
4
$198
$0
0
0
0
0
$0
$334
32
0
0
0
$366
$2,597
76
9
140
0
$2,822
$393
197
262
0
4
$856
Unpaid
Principal
Balance
$2,597
76
9
140
0
$2,822
$393
197
262
0
4
$856
The following table presents the average recorded investment in impaired loans and related interest income recognized
for the periods indicated (in thousands):
Average investment in impaired loans
Interest income recognized on an accrual basis on impaired loans
December
2011
$2,091
$84
2010
$1,901
$76
Management uses a nine point internal risk rating system to monitor the credit quality of the overall loan portfolio. The
first six categories are considered not criticized, and are aggregated as "Pass" rated. The criticized rating categories
utilized by management generally follow bank regulatory definitions. The Special Mention category includes assets that
are currently protected but are potentially weak, resulting in an undue and unwarranted credit risk, but not to the point of
justifying a Substandard classification. Loans in the Substandard category have well-defined weaknesses that jeopardize
the liquidation of the debt, and have a distinct possibility that some loss will be sustained if the weaknesses are not
corrected. All loans greater than 90 days past due are considered Substandard. The portion of any loan that represents
a specific allocation of the allowance for loan losses is placed in the Doubtful category. Any portion of a loan that has
been charged off is placed in the Loss category.
20
21
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
To help ensure that risk ratings are accurate and reflect the present and future capacity of borrowers to repay a loan as
agreed, the Bank has a structured loan rating process with several layers of internal and external oversight. Generally,
consumer and residential mortgage loans are included in the Pass categories unless a specific action, such as
bankruptcy, repossession, or death occurs to raise awareness of a possible credit event. The Bank's Chief Credit Officer
is responsible for the timely and accurate risk rating of the loans in the portfolio at origination and on an ongoing basis.
The Credit Department performs an annual review of all commercial relationships $750,000 or greater. Confirmation of
the appropriate risk grade is included in the review on an ongoing basis. The Bank has an experienced Credit
Department that continually reviews and assesses loans within the portolio. The Bank engages an external consultant to
conduct loan reviews on at least an annual basis. Generally, the external consultant reviews larger commercial
relationships or criticized relationships. The Credit Department compiles detailed reviews, including plans for resolution,
on loans classified as Substandard on a quarterly basis. Loans in the Special Mention and Substandard categories that
are collectively evaluated for impairment are given separate consideration in the determination of the allowance.
The following table represents the classes of the loan portfolio summarized by the aggregate Pass and the criticized
categories of Special Mention, Substandard and Doubtful within the internal risk rating system as of December 31, 2011
and 2010 (in thousands):
December 31, 2011
Commercial
Residential
Home Equity
Installment
Credit Card
Total
December 31, 2010
Commercial
Residential
Home Equity
Installment
Credit Card
Total
Pass
$218,353
111,105
15,750
12,806
565
$358,579
$180,568
69,906
13,945
12,424
488
$277,331
Special
Mention
$7,752
1,157
96
242
-
$9,247
$8,294
613
99
233
-
$9,239
Substandard
Doubtful
Total
$2,655
491
75
29
-
$3,250
$5,446
1,002
262
173
6
$6,889
$2,597
-
9
140
-
$2,746
$392
165
28
-
-
$585
$231,357
112,753
15,930
13,217
565
$373,822
$194,700
71,686
14,334
12,830
494
$294,044
Management further monitors the performance and credit quality of the loan portfolio by analyzing the age of the portfolio as
determined by the length of time a recorded payment is past due. The following table presents the classes of the loan
portfolio summarized by the aging categories of performing loans and nonaccrual loans as of December 31, 2011 and
2010:
(in thousands)
Total
30-59 Days
Past Due
60-89 Days
Past Due
90 Days +
Past Due
Past Due
Non-
Accrual
Total
Loans
December 31, 2011
Commercial
Residential
Home Equity
Installment
Credit Card
Total
December 31, 2010
Commercial
Residential
Home Equity
Installment
Credit Card
Total
Current
$225,618
111,022
15,846
12,888
565
$365,939
$193,414
68,529
13,979
12,222
490
$288,634
$448
1,593
-
138
-
$2,179
$2,836
-
84
26
-
$2,946
$2
62
-
2
-
$66
$3,286
1,655
84
166
-
$5,191
$2,453
76
-
163
-
$2,692
$231,357
112,753
15,930
13,217
565
$373,822
241
1,761
28
141
-
272
18
158
-
$2,171
-
$448
$217
143
47
155
-
$562
$458
2,176
93
454
-
$3,181
$828
981
262
154
4
$2,229
$194,700
71,686
14,334
12,830
494
$294,044
20
21
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
An allowance for loan losses ("ALL") is maintained to absorb losses from the loan portfolio. The ALL is based on
management's continuing evaluation of the risk characteristics and credit quality of the loan portfolio, assessment of current
economic conditions, diversification and size of the portfolio, adequacy of collateral, past and anticipated loss experience, and
the amount of non-performing loans.
The Bank's methodology for determining the ALL is based on the requirements of ASC Section 310-10-35 for loans individually
evaluated for impairment (discussed above) and ASC Subtopic 450-20 for loans collectively evaluated for impairment, as well
as the Interagency Policy Statements on the Allowance for Loan and Lease Losses and other bank regulatory guidance. The
total of the two components represents the Bank's ALL.
Loans that are collectively evaluated for impairment are analyzed with general allowances being made as appropriate. For
general allowances, historical loss trends are used in the estimation of losses in the current portfolio. These historical loss
amounts are modified by other qualified factors.
The classes described above, which are based on the Federal call code assigned to each loan, provide the starting point for the
ALL analysis. Management tracks the historical net charge-off activity at the call code level. A historical charge-off factor is
calculated utilizing a defined number of consecutive historical quarters. Commercial, Mortgage and Consumer pools currently
utilize a rolling 12 quarters.
"Pass" rated credits are segregated from "Criticized" credits for the application of qualitative factors. Loans in the criticized
pools, which possess certain qualities or characteristics that may lead to collection and loss issues, are closely monitored by
management and subject to additional qualitative factors.
Management has identified a number of additional qualitative factors which it uses to supplement the historical charge-off factor
because these factors are likely to cause estimated credit losses associated with the existing loan pools to differ from historical
loss experience. The additional factors that are evaluated quarterly and updated using information obtained from internal,
regulatory, and governmental sources are: national and local economic trends and conditions; levels of and trends in
delinquency rates and non-accrual loans; trends in volume and terms of loans; effects of changes in lending policies;
experience, ability, and depth of lending staff; value of underlying collateral; and concentrations of credit from a loan type,
industry and/or geographic standpoint.
Management reviews the loan portfolio on a quarterly basis using a defined, consistently applied process in order to make
appropriate and timely adjustments to the ALL. When information confirms all or part of specific loans to be uncollectible, these
amounts are promptly charged off against the ALL.
Historically, management has utilized an internally developed spreadsheet to track and apply the various components of the
allowance.
The following table summarizes the primary segments of the ALL, segregated into the amount required for loans individually
evaluated for impairment and the amount required for loans collectively evaluated for impairment as of December 31, 2011 and
2010. Activity in the allowance is presented for the year ended December 31, 2011 (in thousands):
Commercial
Residential
Home
Equity
Installment
Credit
Card
Total
ALL balance at
December 31, 2010
Charge-offs
Recoveries
Provision
ALL balance at
December 31, 2011
Individually evaluated
for impairment
Collectively evaluated
for impairment
$ 1,517
(552)
4
1,195
$ 460
(349)
-
255
$ 207
(177)
10
209
$ 274
(105)
19
67
$ 20
(6)
-
(3)
$ 2,478
(1,189)
33
1,723
$ 2,164
$ 366
$ 249
$ 255
$ 11
$ 3,045
$758
$1,406
$10
$356
$9
$240
$100
$155
$0
$877
$11
$2,168
22
23
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
The allowance for loan losses is based on estimates, and actual losses will vary from current estimates. Management
believes that the granularity of the homogeneous pools and the related historical loss ratios and other qualitative factors, as
well as the consistency in the application of assumptions, result in an ALL that is representative of the risk found in the
components of the portfolio at any given date.
Troubled Debt Restructurings
The restructuring of a loan is considered a "troubled debt restructuring" if both (i) the borrower is experiencing financial
difficulties and (ii) the creditor has granted a concession. Concessions may include interest rate reductions or below market
interest rates, principal forgiveness, restructuring amortization schedules and other actions intended to minimize potential
losses. Troubled debt restructurings during 2011 are set forth in the following table. There were no troubled debt
restructurings during 2010.
The following table presents details related to loans identified as Troubled Debt Restructurings (TDRs) at December 31,
2011 and 2010.
New TDRs (1)
(Unaudited, dollars in
thousands)
Commercial real estate:
Land and construction
Other
Total commercial real estate
Commercial and industrial
Residential real estate
Home equity
Consumer
Total
Number of
Contracts
-
-
1
11
-
1
-
-
2
December 31, 2011
December 31, 2010
Pre-
Modification
Outstanding
Recorded
Investment
Post-
Modification
Outstanding
Recorded
Investment
-
-
-
-
103
103
103
103
-
-
415
415
-
-
-
-
518
518
Pre-
Modification
Outstanding
Recorded
Investment
Post-
Modification
Outstanding
Recorded
Investment
Number of
Contracts
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(1) Excludes loans that were either paid off or charged-off by period end. The pre-modification balance represents the balance outstanding at the beginning of
the period. The post-modification balance represents the outstanding balance at period end.
NOTE 4. BANK PREMISES, FURNITURE AND EQUIPMENT
Bank premises, furniture and equipment at December 31, were as follows:
(Dollars in thousands)
Bank Premises
Equipment, furniture and fixtures
Allowance for depreciation
2011
2010
$ 7,647
3,445
11,092
(3,310)
$ 7,782
$ 7,533
2,893
10,426
(2,847)
$ 7,579
22
23
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
NOTE 5. DEPOSITS
Deposits at December 31, were as follows:
(Dollars in thousands)
Demand deposits of individuals, partnerships, and corporations
Interest bearing
Non-interest bearing
Time and savings deposits of individuals, partnerships and corporations
Deposits of states and political subdivisions
Official checks
Total Domestic Deposits
2011
2010
$ 113,515
37,744
184,993
53,237
1,056
$ 390,545
$ 77,970
27,984
161,534
32,431
515
$ 300,434
Time deposits of over $100 included above
$ 65,316
$ 58,661
Maturities of certificates of deposit at December 31, 2011 were as follows:
2012
2013
2014
2015
2016
Total
$ 58,029
18,013
6,190
5,317
5,539
$ 93,088
NOTE 6. BORROWED FUNDS
The Company is a party to repurchase agreements with certain customers. As of December 31, 2011 and 2010, the
company held repurchase agreements of $77,835 and $47,623. Information related to repurchase agreements is
summarized below:
(Dollars in thousands)
2011
2010
Balance at end of year
Average balance during the year
Maximum month-end balance
Weighted-average rate during the year
Rate at December 31
$ 77,835
61,855
86,507
0.81%
0.66%
$ 47,623
44,238
55,550
1.07%
1.00%
MVB Bank, Inc. (the Bank) is a member of the Federal Home Loan Bank ("FHLB") of Pittsburgh, Pennsylvania. The
remaining maximum borrowing capacity with the FHLB at December 31, 2011 was approximately $174,439. At
December 31, 2011 and 2010 the Bank had borrowed $9,767 and $24,114.
24
25
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
Borrowings from the FHLB as of December 31 were as follows:
(Dollars in thousands)
Fixed interest rate note, originating April 1999, due April 2014, interest of
5.405% is payable monthly
2011
2010
$ 1,000
$ 1,000
Fixed interest rate note, originating January 2005, due January 2020, payable
in monthly installments of $11, including interest of 5.140%
851
933
Fixed interest rate note, originating April 2002, due May 2017, payable in
monthly installments of $4, including interest of 5.90%
631
647
Floating interest rate note, originating March 2003, due December 2011,
interest payable monthly, including interest of 0.68%
-
14,126
Fixed interest rate note, originating July 2006, due July 2016, payable in
monthly installments of $8, including interest of 4.50%
1,301
1,341
Fixed interest rate note, originating October 2006, due October 2021, payable
in monthly installments of $6, including interest of 5.20%
1,068
1,089
Fixed interest rate note, originating April 2007, due April 2022, payable in
monthly installments of $6, including interest of 5.18%
1,015
1,034
Amortizing fixed interest rate note, originating February 2007, due February
2022, payable in monthly installments of $5, including interest of 5.22%
896
913
Fixed interest rate note, originating December 2007, due December 2017,
payable in monthly installments of $7, including interest of 5.25%
1,005
1,031
Fixed interest rate note, originating March 2008. due March 2013, interest of
2.37% payable quarterly
2,000
2,000
$ 9,767
$ 24,114
In March 2007 the Company completed the private placement of $4 million Floating Rate, Trust Preferred Securities
through its MVB Financial Statutory Trust I subsidiary (the "Trust"). The Company established the Trust for the sole
purpose of issuing the Trust Preferred Securities pursuant to an Amended and Restated Declaration of Trust. The
proceeds from the sale of the Trust Preferred Securities will be loaned to the Company under subordinated
Debentures (the "Debentures") issued to the Trust pursuant to an Indenture. The Debentures are the only asset of
the Trust. The Trust Preferred Securities have been issued to a pooling vehicle that will use the distributions on the
Trust Preferred Securities to securitize note obligations. The securities issued by the Trust are includable for
regulatory purposes as a component of the Company's Tier I capital.
The Trust Preferred Securities and the Debentures mature in 2037 and are redeemable by the Company in 2012.
Interest payments are due in March, June, September and December and are adjusted at the interest due dates at a
rate of 1.62% over the three month LIBOR Rate. The Company reflects borrowed funds in the amount of $4.1 million
as of December 31, 2011 and 2010 and interest expense of $81 and $82 for the years ended December 31, 2011
and 2010.
24
25
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
Borrowings from the FHLB are secured by stock in the FHLB of Pittsburgh, qualifying first mortgage loans, mortgage-
backed securities and certain investment securities.
The bank had borrowed $4,500 in overnight funds at the Federal Reserve discount window on December 31, 2010 at
a rate of 0.75%.
A summary of maturities of these borrowings over the next five years is as follows:
Year
2012
2013
2014
2015
2016
Thereafter
Amount
$ 232
2,244
1,257
271
1,353
8,534
$ 13,891
NOTE 7. COMMITMENTS AND CONTINGENT LIABILITIES
Financial Instruments with Off-Balance-Sheet Risk
The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business to
meet the financing needs of its customers. These financial instruments include commitments to extend credit and
standby letters of credit. These instruments involve, to varying degrees, elements of credit and interest rate risk in
excess of the amounts recognized in the statements of financial condition.
The Company's exposure to credit loss in the event of nonperformance by the other party to the financial
instruments for commitments to extend credit and standby letters of credit is represented by the contractual
amount of those instruments. The Company uses the same credit policies in making commitments and
conditional obligations as it does for on-balance-sheet instruments.
Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any
condition established in the contract. Commitments generally have fixed expiration dates or other termination
clauses and may require payment of a fee. Since many of the commitments are expected to expire without being
drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company
evaluates each customer’s credit worthiness on a case-by-case basis. The amount and type of collateral
obtained, if deemed necessary by the Company upon extension of credit, varies and is based on management's
credit evaluation of the customer.
Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a
customer to a third party. Standby letters of credit generally have fixed expiration dates or other termination
clauses and may require payment of a fee. The credit risk involved in issuing letters of credit is essentially the
same as that involved in extending loans to customers. The Company's policy for obtaining collateral, and the
nature of such collateral, is essentially the same as that involved in making commitments to extend credit.
Total contractual amounts of the commitments as of December 31 were as follows:
(Dollars in thousands)
Available on lines of credit
Stand-by letters of credit
Other loan commitments
2011
2010
$ 45,627
346
1,423
$ 47,396
$ 32,539
758
691
$ 33,988
26
27
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
Concentration of Credit Risk
The Company grants a majority of its commercial, financial, agricultural, real estate and installment loans to
customers throughout the Marion, Harrison, Monongalia, Jefferson and Berkeley County areas of West Virginia
and adjacent counties. Collateral for loans is primarily residential and commercial real estate, personal property,
and business equipment. The Company evaluates the credit worthiness of each of its customers on a case-by-
case basis, and the amount of collateral it obtains is based upon management's credit evaluation.
Litigation
The subsidiary bank is involved in various legal actions arising in the ordinary course of business. In the opinion
of management and counsel, the outcome of these matters will not have a significant adverse effect on the
consolidated financial statements.
NOTE 8. INCOME TAXES
Accounting standards require that the Company use an asset and liability approach that requires the recognition
of deferred income tax liabilities and assets for the expected future tax consequences of temporary differences
between the carrying amounts and the tax basis of other assets and liabilities.
The amount reflected as income taxes represents federal and state income taxes on financial statement income.
Certain items of income and expense, primarily the provision for possible loan losses, allowance for losses on
foreclosed assets held for resale, depreciation, and accretion of discounts on investment securities are reported
in different accounting periods for income tax purposes.
The provisions for income taxes for the years ended December 31, were as follows:
(Dollars in thousands)
Current:
2011
$ 658
207
$ 865
2010
$ 773
166
$ 939
Federal
State
Deferred expense(benefit)
Federal
State
Income Tax expense
$ 112
35
147
$ 1,012
$ (119)
(25)
(144)
$ 795
Following is a reconciliation of income taxes at federal statutory rates to recorded income taxes for the year ended
December 31:
2011
2010
Amount
%
Amount
%
Tax at Federal tax rate
Tax effect of:
State income tax
Tax exempt earnings
Other
$ 1,263
34.0%
$ 1,031
34.0%
93
(345)
1
$ 1,012
2.5%
-9.3%
0.0%
27.2%
76
(313)
1
$ 795
2.5%
-10.3%
0.0%
26.2%
26
27
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
Deferred tax assets and liabilities are the result of timing differences in recognition of revenue and expense for
income tax and financial statement purposes.
Deferred income tax liabilities and (assets) were comprised of the following at December 31:
Depreciation
Unrealized loss on securities available-for-sale
Pension
Gross deferred tax liabilities
Allowance for loan losses
Minimum pension liability
Gross deferred tax (assets)
2011
2010
$ 482
$ 303
(9)
776
(871)
(798)
(1,669)
$ 299
$ 264
(66)
497
(778)
(440)
(1,218)
Net deferred tax (asset)
$ (893)
$ (721)
No deferred income tax valuation allowance is provided since it is more likely than not that realization of the
deferred income tax asset will occur in future years.
NOTE 9. RELATED PARTY TRANSACTIONS
The Company has granted loans to officers and directors of the Company and to their associates. Related party
loans are made on substantially the same terms, including interest rates and collateral, as those prevailing at the
time for comparable transactions with unrelated parties and do not involve more than normal risk of collectibility.
Set forth below is a summary of the related loan activity.
(Dollars in thousands)
Balance at
Beginning
of Year
Borrowings
Repayments
Balance
at end
of Year
December 31, 2011
$ 13,995
$ 2,004
$ (2,699)
$ 13,300
December 31, 2010
$ 15,067
$ 764
$ (1,836)
$ 13,995
The Company held related party deposits of $14,973 and $11,812 at December 31, 2011 and December 31, 2010,
respectively.
The Company held related party repurchase agreements of $1,313 and $1,697 at December 31, 2011 and
December 31, 2010, respectively.
NOTE 10. PENSION PLAN
The Company participates in a trusteed pension plan known as the Allegheny Group Retirement Plan covering
virtually all full-time employees. Benefits are based on years of service and the employee's compensation. The
Company's funding policy is to fund normal costs of the plan as accrued. Contributions are intended to provide
not only for benefits attributed to service to date, but also for those benefits expected to be earned in the future.
The Company participated in the pension plan beginning January 1, 1999. The Company has recognized
estimated pension expense of $410 and $335 for the years ended December 31, 2011 and 2010.
28
29
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
Information pertaining to the activity in the Company's defined benefit plan, using the latest available actuarial
valuations with a measurement date of December 31, 2011 and 2010 is as follows:
(Dollars in thousands)
Change in benefit obligation
Benefit obligation at beginning of year
Service cost
Interest cost
Actuarial loss
Benefits paid
Benefit obligation at end of year
Change in plan assets:
Fair value of plan assets at beginning of year
Actual return on plan assets
Employer contribution
Benefits paid
Fair value of plan assets at end of year
Funded status
Unrecognized net actuarial loss
Unrecognized prior service cost
Prepaid pension cost recognized
2011
2010
$ 3,059
356
166
669
(36)
$ 4,214
$ 2,389
311
142
243
(26)
$ 3,059
$ 1,794
(113)
553
(36)
$ 2,198
$ 1,575
188
57
(26)
$ 1,794
$ (2,016)
1,990
4
$ (22)
$ (1,265)
1,093
7
$ (165)
Accumulated benefit obligation
$ 3,288
$ 2,414
At December 31, 2011 and 2010, the weighted average assumptions used to determine the benefit obligation are
as follows:
Discount rate
Rate of compensation increase
The components of net periodic pension cost are as follows:
Service cost
Interest cost
Expected return on plan assets
Amortization of prior service costs
Amortization of loss
Net periodic pension cost
5.06%
3.00%
5.50%
3.00%
$ 356
166
(180)
2
66
$ 410
$ 311
142
(139)
2
44
$ 360
At December 31, 2011 and 2010, the weighted average assumptions used to determine net periodic pension cost
are as follows:
Discount rate
Expected long-term rate of return on plan assets
Rate of compensation increase
5.50%
8.00%
3.00%
6.00%
8.00%
3.00%
28
29
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
The Company's pension plan asset allocations at December 31, 2011 and 2010, as well as target allocations for 2012
are as follows:
Asset Category
Equity securities
Balanced fund
Other
Total
2012 Target
60%
30%
10%
100%
12/31/2011
72%
24%
4%
100%
12/31/2010
59%
31%
10%
100%
The net transition obligation (asset), prior service cost (credit), and estimated net loss (gain) for the plan that are
expected to be amortized from accumulated other comprehensive income into net periodic benefit cost over the next
fiscal year are shown in the table below.
2012
2011
Expected amortization of transition obligation
(asset)
Expected amortization of prior service cost
(credit)
Expected amortization of net loss (gain)
$ -
$ -
2
117
2
66
Plan Assets
The pension plan's overall investment strategy is to achieve a mix of approximately 75 percent of investments for long-
term growth and 25 percent for near-term benefit payments with a wide diversification of asset types, fund strategies,
and fund managers. The target allocations for plan assets are 75 percent equity securities, 20 percent corporate
bonds and US Treasury securities, and 5 percent to all other types of investments. Equity securities primarily include
investments in large-cap and mid-cap companies primarily located in the United States. Fixed income securities
include corporate bonds of companies from diversified industries, mortgage-backed securities, and U.S. Treasuries.
Other types of investments include investments in hedge funds and private equity funds that follow several different
strategies.
The fair value of MVB's pension plan assets at December 31, 2011 by asset class are as follows:
The following table sets forth by level, within the fair value hierarchy, as defined in Note 18 - Fair Value
Measurements, the Plan's assets at fair value as of December 31, 2011.
Level I
Level II
Level III
Total
Assets:
Cash and cash equivalents
Investment in equity securities
Investment in debt
$ 88
$ 1,583
$ -
$ -
$ -
$ 527
$ -
$ -
$ -
$ 88
$ 1,583
$ 527
Total assets at fair value
$ 1,671
$ 527
$ -
$ 2,198
Investment in government and debt securities and short-term investments are valued at the closing price reported on the
active market on which the individual securities are traded.
The methods described above may produce a fair value calculation that may not be indicative of net realizable value or
reflective of future fair values. Furthermore, while the Plan believes its valuation methods are appropriate and consistent
with other market participants, the use of different methodologies or assumptions to determine the fair value of certain
financial instruments could result in a different fair value measurement at the reporting date.
30
31
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
Below we show the best estimate of the plan contribution for next fiscal year. We also show the benefits expected to be
paid in each of the next five fiscal years, and in the aggregate for the five fiscal years thereafter.
Contributions for the period of 01/01/12 through 12/31/12
Estimated future benefit payments reflecting expected future service
1/1/2012 through 12/31/2012
1/1/2013 through 12/31/2013
1/1/2014 through 12/31/2014
1/1/2015 through 12/31/2015
1/1/2016 through 12/31/2016
1/1/2017 through 12/31/2021
Cash Flow
$ 948,348
$ 117,901
$ 129,994
$ 138,416
$ 163,324
$ 201,165
$1,214,592
NOTE 11. INTANGIBLE ASSETS
On October 7, 2005, the Company purchased a full service office in the Charles Town area of Jefferson County
West Virginia. This office held assets of $1.8 million and total deposits of $17.1 million. As a result of this
transaction, the Company recorded intangible assets. As of December 31, 2011 the Company has allocated $21 to
core deposit intangibles, which are being amortized using the double-declining balance method over 10 years. The
remaining $896 has been recorded as goodwill, and is evaluated for impairment on October 1st each year by the
Company.
NOTE 12. STOCK OFFERING
During 2011 the Company completed a confidential offering to accredited investors which began in 2010 that
resulted in the issuance of 393,305 shares of common stock totaling $8.3 million in additional capital. As of
December 31, 2010 the Company had received signed offering memoranda and payment for 82,328 shares totaling
1.7 million in additional capital at December 31, 2010. The proceeds of this offering are being used to support
current and long-range growth plans of the Company. During 2011 the Company issued 393,305 shares,
concluding 2011 with outstanding shares of 2,234,767. A 10% stock dividend declared December 21, 2010 with a
record date of January 25, 2011, payable February 15, 2011 resulted in an additional 39,071 shares.
On September 8, 2011 MVB received $8.5 million in Small Business Lending Fund (SBLF) capital. MVB issued
8,500 shares of $1,000 per share preferred stock with dividends payable in arrears on January 1, April 1, July 1 and
October 1 each year. At the time of receipt of the SBLF money, MVB's loan production qualified for the lowest
dividend rate posssible of 1%. MVB may continue to utilize the SBLF capital for a period of four and one half years
at the 1% dividend rate so long as loan growth continues to support the reduced rate.
NOTE 13. STOCK OPTIONS
The MVB Financial Corp. Incentive Stock Plan provides for the issuance of stock options to selected employees.
Under the provisions of the plan, the option price per share shall not be less than the fair market value of the
common stock on the date of the grant. All options granted prior to 2004 vest in 4 years, and expire 10 years from
the date of grant. For options granted in 2004 and 2005 the vesting period has been accelerated to fully vest at
December 31, 2005. These options also expire 10 years from the date of the grant. Options granted in 2006,
2007, 2010 and 2011 vest in 5 years and expire 10 years from the date of the grant, with the exception of 10,000
shares granted in 2010 that vest in 3 years and expire 10 years from the date of the grant.
30
31
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
The following summarizes MVB's stock options as of December 31, and the changes for the year then ended:
Outstanding at beginning of year
Granted
Adjust for 10% stock dividend
Exercised
Forfeited/expired
2011
2010
Number
of
Shares
Weighted-
Average
Exercise
Price
Number
of
Shares
Weighted-
Average
Exercise
Price
207,297
10,500
21,779
-
-
$ 17.88
-
$ -
-
-
134,658
99,500
-
(12,859)
(14,002)
$ 15.83
-
$ -
-
-
Outstanding at end of year
239,576
$ 16.46
207,297
$ 17.88
Exercisable at end of year
148,973
$ 15.13
115,297
$ 16.00
Weighted-average fair value of options granted
$ 3.67
$ 3.10
during the year
The fair value for the options was estimated at the date of grant using a Black-Scholes option-pricing model with
average risk-free interest rates of 3.29% and 3.28% for 2011 and 2010 and a weighted average expected life of the
options of 7 years for both 2011 and 2010. The expected volatility of MVB's stock price used for 2011 options was
5.40%, while for the 2010 options it was 1.26%. The expected dividend yield used was .50% for both 2011 and 2010.
The following summarizes information concerning MVB's stock options outstanding at December 31, 2011:
Options Outstanding
Weighted
Average
Remaining
Contractual
Weighted
Average
Exercise
Options
Options Exercisable
Weighted
Average
Exercise
Number
Outstanding
Life
Price
Exercisable
Price
127,376
89,650
22,550
5.00
9.00
9.00
$14.55
$18.18
$20.45
148,973
$15.13
Exercise
Price
$14.55
$18.18
$20.45
NOTE 14. REGULATORY CAPITAL REQUIREMENTS
The Bank is subject to various regulatory capital requirements administered by the federal banking agencies. Failure
to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary, actions
by regulators that, if undertaken, could have a direct material effect on the Company's financial statements. Under
capital adequacy guidelines the Bank must meet specific capital guidelines that involve quantitative measures of the
Bank's assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices.
The Bank's capital amounts and classifications are also subject to qualitative judgments by the regulators about
components, risk weightings, and other factors.
32
33
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum
amounts and ratios of Total and Tier I capital to risk-weighted assets, and of Tier I capital to average assets, as
defined. As of December 31, 2011 and 2010, the Bank meets all capital adequacy requirements to which it is
subject.
The most recent notification from the Federal Deposit Insurance Corporation categorized the Bank as well
capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the
Bank must maintain minimum total risk-based, Tier I risk-based, and Tier I leverage ratios as set forth in the table
below. Both the Company's and the Bank's actual capital amounts and ratios are presented in the table below.
ACTUAL
MINIMUM
TO BE WELL
CAPITALIZED
MINIMUM
FOR CAPITAL
ADEQUACY PURPOSES
AMOUNT
RATIO
AMOUNT
RATIO
AMOUNT
RATIO
(Dollars in thousands)
As of December 31, 2011
Total Capital
(to risk-weighted assets)
Consolidated
Subsidiary Bank
Tier I Capital
(to risk-weighted assets)
Consolidated
Subsidiary Bank
Tier I Capital
(to average assets)
Consolidated
Subsidiary Bank
As of December 31, 2010
Total Capital
(to risk-weighted assets)
Consolidated
Subsidiary Bank
Tier I Capital
(to risk-weighted assets)
Consolidated
Subsidiary Bank
Tier I Capital
(to average assets)
Consolidated
Subsidiary Bank
$ 50,603
$ 54,291
14.8%
15.8%
N/A
$ 34,276
N/A
10.0%
$ 27,421
$ 27,421
$ 47,558
$ 51,246
13.9%
14.9%
N/A
$ 20,566
N/A
6.0%
$ 13,710
$ 13,710
$ 47,558
$ 51,246
8.9%
9.6%
N/A
$ 26,686
N/A
5.0%
$ 21,354
$ 21,349
$ 32,582
$ 36,275
11.9%
13.3%
N/A
$ 27,258
N/A
10.0%
$ 21,807
$ 21,807
$ 30,104
$ 33,797
11.0%
12.4%
N/A
$ 16,355
N/A
6.0%
$ 10,903
$ 10,903
$ 30,104
$ 33,797
7.3%
8.2%
N/A
$ 20,590
N/A
5.0%
$ 16,487
$ 16,472
8.0%
8.0%
4.0%
4.0%
4.0%
4.0%
8.0%
8.0%
4.0%
4.0%
4.0%
4.0%
NOTE 15. REGULATORY RESTRICTION ON DIVIDEND
The approval of the regulatory agencies is required if the total of all dividends declared by the Bank in any calendar
year exceeds the Bank's net profits, as defined, for that year combined with its retained net profits for the preceding
two calendar years.
32
33
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
NOTE 16. LEASES
The Company leases land and building space for the operation of some banking offices. All such leases qualify as
operating leases. Following is a schedule by year of future minimum lease payments required under operating
leases that have initial or remaining non-cancelable lease terms in excess of one year as of December 31, 2011:
Years ended December 31:
(Dollars in thousands)
2012
2013
2014
2015
2016
Thereafter
Total minimum payments required:
$ 245
226
164
164
151
246
$ 1,196
Total lease expense for the years ended December 31, 2011 and 2010 was $156 and $54, respectively.
NOTE 17. FAIR VALUE OF FINANCIAL INSTRUMENTS
The following summarizes the methods and significant assumptions used by the Company in estimating its fair
value disclosures for financial instruments.
Short-term financial instruments: The carrying values of short-term financial instruments including cash and due
from banks, interest bearing balances - FHLB, and certificates of deposit in other banks approximate the fair value
of these instruments.
Securities: Estimated fair values of securities are based on quoted market prices, where available. If quoted
market prices are not available, estimated fair values are based on quoted market prices of comparable securities.
Loans: The estimated fair values for loans are computed based on scheduled future cash flows of principal and
interest, discounted at interest rates currently offered for loans with similar terms of borrowers of similar credit
quality. No prepayments of principal are assumed.
Accrued interest receivable and payable: The carrying values of accrued interest receivable and payable
approximate their estimated fair values.
Repurchase agreements: The fair values of repurchase agreements approximate their estimated fair values.
Deposits: The estimated fair values of demand deposits (i.e., non interest bearing checking, NOW and money
market), savings accounts and other variable rate deposits approximate their carrying values. Fair values of fixed
maturity deposits are estimated using a discounted cash flow methodology at rates currently offered for deposits
with similar remaining maturities. Any intangible value of long-term relationships with depositors is not considered
in estimating the fair values disclosed.
Off-balance sheet instruments: The fair values of commitments to extend credit and standby letters of credit are
estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms
of agreements and the present credit standing of the counterparties. The amounts of fees currently charged on
commitments and standby letters of credit are deemed insignificant, and therefore, the estimated fair values and
carrying values are not shown.
34
35
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
The carrying values and estimated fair values of the Company's financial instruments are summarized as follows:
Financial assets:
Cash and due from banks
Interest bearing balances with banks
Securities available-for-sale
Securities held-to-maturity
Loans
Accrued interest receivable
Financial liabilities:
Deposits
Repurchase agreements
FHLB and other borrowings
Accrued interest payable
Long-term debt
Financial assets:
Cash and due from banks
Interest bearing balances with banks
Securities available-for-sale
Securities held-to-maturity
Loans
Accrued interest receivable
Financial liabilities:
Deposits
Repurchase agreements
FHLB and other borrowings
Accrued interest payable
Long-term debt
December 31, 2011
Carrying
Value
Estimated
Fair
Value
(Dollars in thousands)
$ 9,763
10,196
99,366
13,568
373,822
1,582
$ 508,297
$ 390,545
77,835
9,767
341
4,124
$ 482,612
$ 9,763
10,216
99,366
14,144
388,027
1,582
$ 523,098
$ 400,894
77,861
11,027
341
4,124
$ 494,247
December 31, 2010
Carrying
Value
Estimated
Fair
Value
$ 3,713
27,825
61,824
7,460
294,044
1,398
$ 396,264
$ 300,434
47,623
28,614
378
4,124
$ 381,173
$ 3,713
27,878
61,824
7,442
302,277
1,398
$ 404,532
$ 307,584
47,671
32,305
378
4,124
$ 392,062
34
35
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
Fair value estimates are made at a specific point in time, based on relevant market information about the financial
instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time
the Company's entire holdings of a particular financial instrument. Because no market exists for a significant portion of
the Company's financial instruments, fair value estimates are based on judgments regarding future expected loss
experience, current economic conditions, risk characteristics of various financial instruments and other factors. These
estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore, cannot
be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates
are based on existing on-and-off balance sheet financial instruments without attempting to estimate the value of
anticipated future business and the value of assets and liabilities that are not considered financial instruments.
NOTE 18. FAIR VALUE MEASUREMENTS
Accounting standards require that the Company adopt fair value measurement for financial assets and financial
liabilities. This enhanced guidance for using fair value to measure assets and liabilities applies whenever other
standards require or permit assets or liabilities to be measured at fair value. This guidance does not expand the use
of fair value in any new circumstances.
Accounting standards establish a hierarchal disclosure framework associated with the level of pricing observability
utilized in measuring assets and liabilities at fair value. The three broad levels defined by these standards are as
follows:
Level I: Quoted prices are available in active markets for identical assets or liabilities as of the reported date.
Level II: Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly
observable as of the reported date. The nature of these assets and liabilities include items for which quoted prices
are available but traded less frequently, and items that are fair valued using other financial instruments, the
parameters of which can be directly observed.
Level III: Assets and liabilities that have little to no pricing observability as of the reported date. These items do
not have two-way markets and are measured using management's best estimate of fair value, where the inputs into
the determination of fair value require significant management judgment or estimation.
The following tables present the assets and liabilities reported on the consolidated statements of financial condition
at their fair value as of December 31, 2011 and 2010 by level within the fair value hierarchy. As required by
accounting standards, financial assets and liabilities are classified in their entirety based on the lowest level of input
that is significant to the fair value measurement. The Company classified investments in government securities as
Level 2 instruments and valued them using the market approach. All measurements are made on a recurring basis.
(In Thousands)
Level I Level II
Level
III
Total
Level I
Level II
Level
III
Total
December 31, 2011
December 31, 2010
Assets:
U.S. Government Agency Securities
Mortgage backed Securities
Other Securities
Other Real Estate Owned
Impaired Loans
Total
Level 3 rollforward table
(In Thousands)
51,874
47,368
124
- 176
- 2,822
99,366
51,874
47,368
124
176
2,822
2,998 102,364
35,280
26,420
124
- 402
- 856
1,258
61,824
35,280
26,420
124
402
856
63,082
Level 3 measurements
at 12/31/10
$1,258
Gain/(loss)
(596)
Additions
2,819
Sales
(483)
Level 3 measurements
at 12/31/11
$2,998
36
37
Fair value estimates are made at a specific point in time, based on relevant market information about the financial
instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time
the Company's entire holdings of a particular financial instrument. Because no market exists for a significant portion of
the Company's financial instruments, fair value estimates are based on judgments regarding future expected loss
experience, current economic conditions, risk characteristics of various financial instruments and other factors. These
estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore, cannot
be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates
are based on existing on-and-off balance sheet financial instruments without attempting to estimate the value of
anticipated future business and the value of assets and liabilities that are not considered financial instruments.
NOTE 18. FAIR VALUE MEASUREMENTS
Accounting standards require that the Company adopt fair value measurement for financial assets and financial
liabilities. This enhanced guidance for using fair value to measure assets and liabilities applies whenever other
standards require or permit assets or liabilities to be measured at fair value. This guidance does not expand the use
of fair value in any new circumstances.
Accounting standards establish a hierarchal disclosure framework associated with the level of pricing observability
utilized in measuring assets and liabilities at fair value. The three broad levels defined by these standards are as
follows:
Level I: Quoted prices are available in active markets for identical assets or liabilities as of the reported date.
Level II: Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly
observable as of the reported date. The nature of these assets and liabilities include items for which quoted prices
are available but traded less frequently, and items that are fair valued using other financial instruments, the
parameters of which can be directly observed.
Level III: Assets and liabilities that have little to no pricing observability as of the reported date. These items do
not have two-way markets and are measured using management's best estimate of fair value, where the inputs into
the determination of fair value require significant management judgment or estimation.
The following tables present the assets and liabilities reported on the consolidated statements of financial condition
at their fair value as of December 31, 2011 and 2010 by level within the fair value hierarchy. As required by
accounting standards, financial assets and liabilities are classified in their entirety based on the lowest level of input
that is significant to the fair value measurement. The Company classified investments in government securities as
Level 2 instruments and valued them using the market approach. All measurements are made on a recurring basis.
(In Thousands)
Level I Level II
Total
Level I
Level II
Total
Level
III
Level
III
December 31, 2011
December 31, 2010
Assets:
U.S. Government Agency Securities
Mortgage backed Securities
Other Securities
Other Real Estate Owned
Impaired Loans
Total
Level 3 rollforward table
(In Thousands)
Level 3 measurements
at 12/31/10
$1,258
51,874
47,368
124
51,874
47,368
124
- 176
176
- 2,822
2,822
99,366
2,998 102,364
35,280
26,420
124
35,280
26,420
124
- 402
402
- 856
856
61,824
1,258
63,082
Gain/(loss)
(596)
Additions
2,819
Sales
(483)
at 12/31/11
$2,998
Level 3 measurements
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MVB FINANCIAL CORP.
December 31, 2011
NOTE 19. CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY
The investment of the Company in its second tier subsidiaries is presented on the equity method of accounting.
Information relative to the parent company's balance sheets at December 31, 2010 and 2009, and the related
statements of income and cash flows for each of those years are presented below:
(Dollars in thousands, except share data)
Balance Sheets
Assets
Cash
Investment in bank subsidiary,
eliminated in consolidation
Other assets
Total assets
Liabilities and shareholders' equity
Liabilities
Other liabilities
Long-term debt
Total liabilities
Stockholders' equity
Preferred stock, par value $1,000; 8,500
and 5,000 shares authorized, 8,500 and
0 shares issued
Common stock, par value $1; 4,000,000
shares authorized; 2,234,767 and
1,802,391 shares issued
respectively
Additional paid in capital
Common stock paid for but not issued,
par value $1; 82,328 shares issued
Treasury stock
Retained earnings
Accumulated other comprehensive income
Total stockholders' equity
Total liabilities and stockholders' equity
(Dollars in thousands)
Statements of Income
Income - dividends from bank subsidiary
Expenses - operating
(Loss) before income taxes and
undistributed income
Income tax (benefit)
Income after tax
Equity in undistributed income of bank
subsidiary
Net income
December 31
2011
2010
$ 167
$ 1,779
51,421
293
$ 51,881
32,733
385
$ 34,897
$ 25
4,124
4,149
$ 4
4,124
4,128
$ 8,500
$ -
2,235
32,603
-
(1,084)
6,220
(742)
47,732
$ 51,881
2011
$ -
296
(296)
(112)
(184)
2,886
$ 2,702
1,802
23,864
1,729
(1,006)
4,643
(263)
30,769
$ 34,897
2010
$ -
176
(176)
(67)
(109)
2,346
$ 2,237
36
37
(Dollars in thousands)
Statements of Cash Flows
OPERATING ACTIVITIES
Net income
Equity in undistributed income of bank
subsidiary
Decrease/(increase) in other assets
Increase in other liabilities
Stock option expense
Unrealized (loss)/gain
Net cash (used in)
operating activities
INVESTING ACTIVITIES
Investment in subsidiary
Net cash (used in)/provided by
investing activities
FINANCING ACTIVITIES
Proceeds of stock offering
Preferred stock issued
Proceeds from long-term borrowings
Common stock options exercised
Cash dividend
Preferred stock dividend
Purchase of treasury stock
Net cash provided by
financing activities
Exhibit 99.2
2011
2010
$ 2,702
$ 2,237
(2,886)
92
21
117
(479)
(2,346)
(66)
-
46
80
(433)
(49)
(15,802)
161
(15,802)
161
6,500
8,463
-
-
(218)
(44)
(78)
1,729
-
-
183
(160)
-
(484)
14,623
1,268
(Decrease)/increase in cash
(1,612)
1,380
Cash at beginning of period
1,779
399
Cash at end of period
$ 167
$ 1,779
38
39
MVB Financial Corp.
Selected Financial Data
Amounts in thousands,
except for share data
Summary of Operations
Interest Income
Interest Expense
Net Interest Income
Provisions for Loan Losses
Non-Interest Income
Non-Interest Expense
Applicable Income Tax
Expenses (Benefit)
Net Income (Loss) from operations
Per Share Data
Basic Net Income (Loss)/Share
Fully Diluted Net Income/Share
Cash Dividends Declared
Book Value
Basic weighted-average shares outstanding
Diluted weighted-average shares outstanding
Average Balance Sheet
Summary
Loans, Gross
Investment Securities
Total Assets
Deposits
Capital
End of Period Balance Sheet
Summary
Loans, Gross
Investment Securities
Total Assets
Deposits
Capital
Selected Ratios
Average Equity to
Average Assets
Return on Average Assets
Net Income (Loss)
Return on Average Equity
Net Income (Loss)
At or for the Year
Ended December 31
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
$
$
$
$
19,008
4,900
14,108
1,723
3,688
12,359
1,012
2,702
1.24
1.21
0.10
17.88
2,148
2,194
334,747
95,529
473,734
353,698
40,379
373,822
112,934
533,481
390,545
47,732
16,287
5,470
10,817
1,100
2,454
9,139
795
2,237
1.40
1.38
0.10
17.07
1,598
1,626
261,116
64,104
390,350
293,913
28,037
294,044
69,284
414,267
300,434
30,769
14,337
5,533
8,804
785
2,190
8,349
454
1,406
0.88
0.86
0.10
16.64
1,602
1,628
219,356
30,456
310,187
232,023
26,746
232,847
43,886
352,762
264,531
27,138
13,687
5,949
7,738
595
1,788
7,840
263
828
0.52
0.51
0.10
16.11
1,584
1,621
189,070
27,568
238,785
169,946
25,695
203,241
26,591
258,706
173,065
25,836
13,274
6,377
6,897
584
1,623
6,240
414
1,282
0.87
0.85
n/a
15.60
1,470
1,509
158,495
26,658
205,544
147,454
22,259
181,537
27,843
230,098
157,448
23,525
10,011
4,360
5,651
445
1,240
5,132
341
973
0.68
0.67
n/a
14.82
1,428
1,588
124,794
27,335
168,950
122,733
20,015
142,599
28,739
191,284
134,593
21,655
6,651
2,326
4,325
160
876
4,284
195
562
0.57
0.49
n/a
13.52
993
1,153
5,536
1,570
3,966
269
677
2,689
627
1,058
1.46
1.41
n/a
11.80
726
752
87,145
22,466
123,668
95,349
12,957
105,214
28,534
151,334
113,953
18,518
70,252
23,012
101,887
81,414
8,342
78,844
20,791
106,206
85,486
8,843
4,852
1,702
3,150
223
598
2,348
396
781
1.10
1.07
n/a
11.04
708
730
55,301
25,219
91,981
71,657
7,575
62,615
25,073
94,936
75,338
7,818
4,227
1,852
2,375
225
458
2,033
175
400
0.70
0.68
n/a
10.37
571
586
42,153
18,794
74,597
58,294
5,379
48,032
22,335
80,977
64,904
7,340
3,893
2,195
1,698
166
391
1,712
64
147
0.28
0.27
n/a
8.75
533
541
30,560
14,773
59,425
44,924
4,761
35,075
18,121
65,325
49,710
4,798
2,977
1,820
1,157
138
207
1,397
1,188
643
545
104
127
944
(50)
(121)
(118)
(258)
(0.23)
(0.23)
n/a
8.48
517
517
(0.57)
(0.57)
n/a
9.14
517
517
20,429
8,400
42,764
31,646
4,500
26,117
10,093
50,358
38,110
4,622
5,591
5,553
19,461
12,336
4,058
13,899
8,139
34,087
24,006
4,572
8.52%
7.18%
8.62%
10.76%
10.83%
11.85%
10.48%
8.19%
8.24%
7.21%
8.01%
10.52%
20.85%
0.57%
0.57%
0.45%
0.35%
0.62%
0.58%
0.45%
1.04%
0.85%
0.54%
0.25%
-0.28%
-6.36%
6.69%
7.98%
5.26%
3.22%
5.76%
4.86%
4.34%
12.68%
10.31%
7.44%
3.09%
-2.69%
-1.33%
Leverage Ratio
9.60%
8.21%
8.55%
11.49%
11.53%
11.35%
11.82%
8.35%
8.21%
8.95%
7.14%
9.40%
24.20%
Risk-Based Capital Ratios
Tier I Capital
Total Capital
Common Stock Price Per Share
at Year End
* adjusted for 5% stock dividends,
effective June 1, 2001 & August 15, 2004 &
10% stock dividend effective February 15, 2011
14.95%
15.84%
12.40%
13.31%
12.32%
13.25%
13.38%
14.26%
13.60%
14.52%
14.37%
15.21%
15.66%
16.45%
11.27%
12.40%
11.98%
13.03%
13.98%
14.96%
12.31%
13.25%
16.20%
17.00%
27.00%
27.60%
$
22.00
19.09
*
18.18
*
18.18
*
18.18
*
14.55 *
14.55
*
12.73 *
11.25 *
10.82 *
9.52 *
9.07
*
9.07
38
39
Shareholder & Company Information
ShArEhOLDErS MEETINg
MVB BANk LOCATIONS & OffICES
301 Virginia Avenue
Fairmont, WV 26554
304.363.4800
888.689.1877
1000 Johnson Avenue
Bridgeport, WV 26330
304.842.6700
888.842.6722
88 Somerset Boulevard
Charles Town, WV 25414
304.728.9500
866.350.8635
651 Foxcroft Avenue
Martinsburg, WV 25401
304.264.4000
800.945.0408
9789 Mall Loop
White Hall, WV 26554
304.366.8400
888.499.4881
2400 Cranberry Square
Morgantown, WV 26508
304.594.3500
The Annual Meeting of Shareholders of MVB Financial Corp. will be held at
5:30 p.m. on Tuesday, May 15, 2012, at MVB Bank’s Fairmont location at 301
Virginia Avenue, Fairmont, West Virginia 26554. Notice of the meeting is
made to shareholders of record as of the close of business on March 26, 2012.
TrANSfEr AgENT AND ShArEhOLDEr INQuIrIES
The corporation’s transfer agent is The Registrar & Transfer Company. Inquiries
concerning transfer requirements, lost certificates and change of address should be
directed to:
The Registrar & Transfer Company
10 Commerce Dr.
Cranford, NJ 07016
www.rtco.com
ALL OThEr INQuIrIES
INVESTOr INQuIrIES TO ThE COMPANy ShOuLD BE DIrECTED TO:
Lisa Wanstreet
304.367.8697
lwanstreet@mvbbanking.com
ALL OThEr INQuIrIES ABOuT ThE COMPANy ShOuLD BE DIrECTED TO:
MVB Financial Corp.
301 Virginia Avenue
Fairmont, West Virginia 26554
304.363.4800
www.mvbbanking.com
fOrM 10k
A copy of the MVB Financial Corp. Form 10-K for 2011, which has been filed with
the SEC, is available without attachments at no charge upon written request and
is also available at http://ir.mvbbanking.com. Inquiries should be directed to the
Investor Relations contact (above).
INDEPENDENT rEgISTErED ACCOuNTINg fIrM
S.R. Snodgrass, A.C. Certified Public Accountants, Wheeling, WV
STOCk MArkET LISTINg
MVB Financial Corp. is an over-the-counter stock traded under the symbol: MVBF
40
kENNEth F. LOWE, III
Board Member of MVB East, Inc.; Director
of Hotel and Restaurant Operations for the
Clarion Hotel & Conference Center & CEO/
Vice President of Ken Lowe Management
Company in Shepherdstown, WV
JOhN t. SChIrrIpA
Board Member of MVB Central, Inc.; President
and Chief Executive Officer of MVB Central,
Inc. and Executive Vice President, Regional
President – Central, and Commercial Loan
Officer of MVB Bank, Inc. in Bridgeport, WV
JAMES r. MArtIN
Chair of MVB Financial Corp., MVB Bank, Inc.
and MVB Central, Inc., Board Member of
MVB East, Inc.; Past President & Chief
Executive Officer of MVB Financial Corp.
and MVB Bank, Inc. in Fairmont, WV
ChrIStOphEr B. ShULtz
Board Member of MVB East, Inc.; Owner/
Realtor of Shultz Realty and Commercial
Associates and Developer in Jefferson
County, WV
Board of Directors
DAVID B. ALVArEz
Board Member of MVB Central, Inc.; President
of MEC Construction in Bridgeport, WV
StEphEN r. BrOOkS
Vice-Chair of MVB Financial Corp.,
MVB Bank, Inc. and MVB Central, Inc.;
Attorney with Flaherty, Sensabaugh &
Bonasso in Morgantown, WV
JAMES J. CAVA, Jr.
Board Member of MVB Central, Inc.; CPA &
Managing Member of Cava & Banko, PLLC
in Bridgeport, WV
Dr. JOSEph p. CINCINNAtI
Chair of MVB East, Inc. and Board Member
of MVB Financial Corp., MVB Bank, Inc. and
MVB Central, Inc.; Orthopedic Surgeon with
the Center of Orthopedic Excellence in
Martinsburg, WV
LArry F. MAzzA
Board Member of MVB Financial Corp., MVB
Bank, Inc., MVB Central, Inc. and MVB East,
Inc.; Chief Executive Officer of MVB Finan-
cial Corp. and President & Chief Executive
Officer of MVB Bank, Inc. and MVB East, Inc.
in Fairmont, WV
BErNIECE D. COLLIS
Vice-Chair of MVB East, Inc., Board Member
of MVB Financial Corp., MVB Bank, Inc.
and MVB Central, Inc.; Vice President of
Minghini’s General Contractors, Inc. in
Martinsburg, WV
BArBArA A. MCkINNEy
Board Member of MVB Financial Corp.,
MVB Bank, Inc. and MVB Central, Inc.;
Owner/Broker – Howard Hannah/Premier
Properties by Barbara Alexander, LLC. in
Morgantown, WV
JOhN W. EBErt
Board Member of MVB Central, Inc.;
President of J. W. Ebert Corp. dba McDonald’s
in Bridgeport, WV.
G. WArrEN MICkEy
Board Member of MVB East, Inc.; Retired
Educator/Farmer, in Charles Town, WV
Dr. CArL r. FISChEr
Board Member of MVB Central, Inc.;
General Surgeon in Bridgeport, WV
Dr. BrIAN D. GILpIN
Board Member of MVB East, Inc.;
Veterinarian with Shenandoah Veterinary
Hospital in Martinsburg, WV
hArVEy M. hAVLIChEk
Board Member of MVB Financial Corp.,
MVB Bank, Inc. and MVB Central, Inc.;
President of Adams Office Supply &
Novelty Company, Inc. in Fairmont, WV
ChrIStINE B. IELApI
Board Member of MVB Central, Inc.;
Executive Vice President of Your Chef, Inc.
in Bridgeport, WV
MArIA k. LOrENSEN
Board Member of MVB East, Inc.;
Development Director for the Hospice
of the Panhandle in Martinsburg, WV
Dr. SAAD MOSSALLAtI
Board Member of MVB Financial Corp.,
MVB Bank, Inc. and MVB Central, Inc..;
Vascular Surgeon with Associated
Specialists, Inc. in Bridgeport, WV
Dr. kELLy r. NELSON
Board Member of MVB Financial Corp.,
MVB Bank, Inc. and MVB Central, Inc.;
Senior Vice President with MedExpress
Urgent Care in Bridgeport, WV
LEONArD W. NOSSOkOFF
Board Member of MVB Financial Corp.,
MVB Bank, Inc. and MVB Central, Inc.; Owner,
Shop ‘n Save Supermarkets in Pittsburgh, PA
J. ChrIStOphEr pALLOttA
Board Member of MVB Financial Corp.,
MVB Bank, Inc., MVB Central, Inc. and
MVB East, Inc.; President of Bond Insurance
Agency in Fairmont, WV
NItESh S. pAtEL
Board Member of MVB Financial Corp.,
MVB Bank, Inc. and MVB Central, Inc.;
Business Consultant; Previously President
& Chief Executive Officer of D.N.
American, Inc. in Dayton, OH
JOhN B. SpADAFOrE
Board Member of MVB Central, Inc.;
Retired Physical Therapist in Bridgeport, WV
LOUIS SpAtAFOrE
Board Member of MVB Financial Corp.,
MVB Bank, Inc. and MVB Central, Inc.;
President & General Manager of Friendly
Furniture Galleries in Fairmont, WV
WAyNE h. StANLEy
Board Member of MVB Financial Corp,
MVB Bank, Inc. and MVB Central, Inc.; Chief
Executive Officer of Victory of West Virginia,
Inc. and President of Stanley Industries, Inc.
in Bridgeport, WV
rIChArD L. tOOthMAN
Board Member of MVB Financial Corp., MVB
Bank, Inc. and MVB Central, Inc.; Broker &
Owner of Toothman Realty in Fairmont, WV
Dr. MIChAEL F. trENt
Board Member of MVB Financial Corp.,
MVB Bank, Inc. and MVB Central, Inc.;
Dentist in the Naval Dental Center in
Camp Lejeune, NC.
rOGEr J. tUrNEr
Board Member of MVB Financial Corp.,
MVB Bank, Inc. and MVB Central, Inc.; Presi-
dent of MVB Financial Corp. and Executive
Vice President and Senior Commercial Loan
Officer of MVB Bank, Inc. in Fairmont, WV
SAMUEL J. WArASh
Board Member of MVB Financial Corp.,
MVB Bank, Inc. and MVB Central, Inc.;
President of S.J. Warash, Inc. in Fairmont, WV
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