Executive Summary

Q3 2025 EPS was $0.81, up 21% sequentially from $0.67, but down 9% year over year from $0.89, driven by earning asset growth, rising loan yields, and a slight decrease in average cost of funds .
Net interest margin expanded to 4.16% from 4.11% in Q2 and 4.04% in Q3 2024, reflecting higher loan yields and stable funding costs; efficiency ratio improved to 58.27% from 61.95% in Q2 .
Balance sheet grew: total assets reached $2.00B (+$74.5M QoQ, +$95.0M YoY); deposits rose to $1.77B (+$63.6M QoQ, +$84.6M YoY); liquidity remained strong with $247.2M in cash and equivalents .
Asset quality remained pristine with zero NPAs; ACL/Gross Loans held at 1.03%; the quarter included a $60K reversal of provision tied to unfunded commitments .
Strategic expansion: the Lodi branch opened Oct 2, 2025, positioning for incremental deposit gathering and commercial/ag lending growth—a likely medium-term catalyst .

What Went Well and What Went Wrong

What Went Well

Net interest income increased to $19.197M, benefiting from average earning asset growth and rising loan yields; NIM improved to 4.16% and EPS rose to $0.81 QoQ .
Non-interest income increased to $1.973M on a one-time life insurance policy gain and stronger investment advisory and deposit fee income .
Operational momentum and footprint expansion: “Our team continues to execute on our growth strategy while maintaining excellent asset quality and customer relationships... The opening of our new Lodi branch demonstrates our focus on expanding our presence across the Central Valley.” — CEO Chris Courtney .

What Went Wrong

EPS declined YoY to $0.81 from $0.89, with prior-year benefiting from a $1.62M ACL reversal; general operating expenses rose YoY due to growth-related staffing and operating costs .
Efficiency ratio, while improved QoQ, remained higher than Q3 2024 (58.27% vs. 56.35%), indicating continued cost pressure alongside expansion initiatives .
Non-interest expense was essentially flat QoQ at $12.700M but up materially YoY (+$1.376M), reflecting growth investments (FTE rose to 237) ahead of the Lodi branch opening .

Financial Results

Quarterly Operating Metrics

Metric (Units)	Q3 2024	Q4 2024	Q1 2025	Q2 2025	Q3 2025
Net Interest Income ($USD Thousands)	$17,655	$17,846	$17,807	$18,154	$19,197
Non-Interest Income ($USD Thousands)	$1,846	$1,430	$1,613	$1,703	$1,973
Non-Interest Expense ($USD Thousands)	$11,324	$11,548	$12,624	$12,688	$12,700
Net Income ($USD Thousands)	$7,324	$6,008	$5,297	$5,588	$6,693
Diluted EPS ($)	$0.89	$0.73	$0.64	$0.67	$0.81
ROAA (%)	1.56%	1.25%	1.13%	1.18%	1.35%
ROAE (%)	16.54%	12.86%	11.58%	12.21%	14.30%
Net Interest Margin (%)	4.04%	4.00%	4.09%	4.11%	4.16%
Efficiency Ratio (%)	56.35%	58.09%	63.00%	61.95%	58.27%

Notes: NIM and efficiency ratio are presented on a fully tax-equivalent basis per non-GAAP methodology; quarter-specific tax-equivalent adjustments provided in the release .

Balance Sheet and KPIs

Metric (Units)	Q3 2024	Q4 2024	Q1 2025	Q2 2025	Q3 2025
Total Assets ($USD Thousands)	$1,900,455	$1,900,604	$1,924,365	$1,920,909	$1,995,416
Gross Loans ($USD Thousands)	$1,075,138	$1,106,535	$1,090,953	$1,109,856	$1,112,829
Deposits ($USD Thousands)	$1,690,301	$1,695,690	$1,713,592	$1,711,241	$1,774,882
ACL ($USD Thousands)	$11,479	$11,460	$11,448	$11,430	$11,420
ACL / Gross Loans (%)	1.07%	1.04%	1.05%	1.03%	1.03%
NPAs / Total Assets (%)	0.00%	0.00%	0.00%	0.00%	0.00%
Book Value/Share ($)	$22.18	$21.95	$21.89	$22.17	$23.63
FTE Staff (count)	222	223	225	231	237
Banking Offices (count)	18	18	18	18	18
Dividends Paid/Share ($)	$0.225	$0.000	$0.300	$0.000	$0.300
Stock Price (period-end, $)	$26.57	$29.25	$24.96	$27.24	$28.17

Additional Q3 detail: Liquidity was strong with $247.2M cash & equivalents; average cost of funds declined slightly; deposits up $63.6M QoQ and $84.6M YoY .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Financial Guidance (Revenue/Margins/OpEx/Tax)	Q4 2025/FY 2025	None provided	None provided	Maintained (no formal guidance)
Dividend Policy	Q3 2025	N/A (policy not guided)	$0.300 dividend paid in Q3 2025	N/A (actual payout; no forward guidance)

Note: OVLY does not provide formal forward guidance in its earnings materials; dividend declarations occur via Board actions and are disclosed when approved .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 2025)	Previous Mentions (Q2 2025)	Current Period (Q3 2025)	Trend
Net Interest Margin & Funding Costs	NIM 4.09%; cost of funds decreased to 0.79% post-Dec-2024 rate cut	NIM 4.11%; cost of funds declined to 0.77%	NIM expanded to 4.16%; slight decrease in average cost of funds	Improving NIM with stable-to-lower funding costs
Asset Quality & CECL	NPAs 0%; ACL 1.05%; CRE risk assessed and reserves adequate	NPAs 0%; ACL 1.03%; no provision recorded	NPAs 0%; ACL 1.03%; $60K reversal tied to unfunded commitments	Pristine asset quality; stable reserves
Balance Sheet Growth (Loans/Deposits)	Deposits +$17.9M QoQ; loans -$15.6M (seasonal paydowns)	Loans +$18.9M QoQ; deposits -$2.4M QoQ	Deposits +$63.6M QoQ; loans +$3.0M QoQ	Strengthening deposits; steady loan growth
Branch Expansion	Lodi branch planned for later 2025	Lodi branch opening later in year	Lodi branch opened Oct 2, 2025	Strategic footprint expansion
Non-Interest Income Mix	Fair value gains on securities	Advisory fees and LP equity adjustment	One-time BOLI gain; advisory and deposit fees higher	Diversified, with some one-time tailwinds

Note: A Q3 2025 earnings call transcript was not available in the company document set; themes reflect disclosures from press releases and 8-Ks .

Management Commentary

“Our team continues to execute on our growth strategy while maintaining excellent asset quality and customer relationships… The opening of our new Lodi branch demonstrates our focus on expanding our presence across the Central Valley.” — Chris Courtney, CEO .
“Our solid earnings results reflect our steady and cautious approach to managing our business… Our commitment to relationship-based deposit growth remains strong…” — Rick McCarty, President & COO (Q2) .
“Our expansion into Downtown Lodi reflects our long-term commitment to serving the Central Valley… provides an opportunity to introduce new customers to Oak Valley’s relationship-focused style of banking.” — Chris Courtney (Lodi opening) .
“We remain committed to delivering steady growth while maintaining a conservative approach to risk management.” — Chris Courtney (Q1) .

Q&A Highlights

No Q3 2025 earnings call transcript located in filings/press materials; Q&A highlights are unavailable based on accessible primary sources.

Estimates Context

S&P Global consensus estimates for Q3 2025 EPS and revenue were unavailable for OVLY; as a result, a beat/miss analysis versus Street consensus cannot be provided. Values retrieved from S&P Global.*

Key Takeaways for Investors

Sequential earnings momentum: EPS rose to $0.81, supported by higher net interest income and margin expansion; QoQ operating leverage improved (efficiency ratio 58.27%) .
Asset quality remains a differentiator: NPAs at 0.00% and ACL/Gross Loans stable at 1.03%—a key risk mitigant for a growing loan book .
Balance sheet strength: deposits and assets expanded QoQ and YoY, with robust liquidity ($247.2M cash), providing flexibility for continued loan growth and branch investments .
Non-interest income benefitted from a one-time BOLI gain; underlying fee streams (advisory, service charges) are trending positively—watch for normalization next quarter .
Expansion catalyst: the Lodi branch adds a new market for relationship-based deposit growth and commercial/ag lending; monitor ramp and associated expense trajectory .
Cost discipline: while OpEx was flat QoQ, YoY growth reflects scaling to support portfolio and branch growth; continued efficiency improvements will be key .
Dividend: $0.300 paid in Q3 2025 vs. $0.225 in Q3 2024; while no forward guidance is provided, payout history suggests ongoing Board-level return of capital decisions .

Oak Valley Bancorp (OVLY)·Q3 2025 Earnings Summary