Citizens Bancorp of Virginia : Solid First Quarter Earnings Reported

PRESS RELEASE - FOR IMMEDIATE DISTRIBUTION

Dated: April 18, 2022

Solid First Quarter Earnings Reported by Citizens Bancorp of Virginia, Inc.

Blackstone, Virginia Citizens Bancorp of Virginia, Inc. (the "Company") (OTCBB: CZBT), the parent company of Citizens Bank and Trust Company (the "Bank"), reported solid quarterly earnings of $1.377 million, or $.65 per share, for the period ended March 31, 2022 compared to $1.545 million, or $.72 per share, for the same period in 2021. The Company's return on assets for the first quarter of 2022 was .98%, down from 1.25% in 2021 as total assets year-over-year increased by 8.24%.

Earnings Highlights

The Company reported a slight decrease of $31 thousand, or (0.9)%, in net interest income for the first quarter of 2022 compared to the same quarter in 2021. Loan fees decreased by $168 thousand in the first quarter primarily due to a reduction in Paycheck Protection Program (PPP) fees. Noninterest income decreased by $60 thousand from a decline in gains on the sale of secondary market loans. Noninterest expense increased $312 thousand to $2.650 million in 2022 from $2.338 in 2021 mainly due to the accounting for origination costs of PPP loans in 2021. As a result of the reduced uncertainty surrounding the COVID-19 pandemic and improved economic conditions, the Bank released $200 thousand from the allowance for loan losses. Management will continue monitoring key economic metrics and the stability in the quality of the Bank's loan portfolio to determine if any further adjustments in the allowance may be warranted. The Company's net interest margin for the first quarter of 2022 was 2.59% versus 3.02% in the first quarter of 2021 and was impacted by the reduction in PPP loan fees.

Balance Sheet

At March 31, 2022 total Company assets were $570 million, an increase of $3.1 million from December 31, 2021. Gross loans ended the period at $206.8 million, a decrease of $5.9 million, and total deposits increased to $504.2 million from $495.8 at year end 2021. Noninterest-bearing deposits decreased slightly from $121.3 million at year end 2021 to $120.3 million, and interest-bearing deposits increased from $374.4 million to $383.9 million during the same period.

Capital Strength

The Company's total equity at March 31, 2022 was $54.7 million and its Community Bank Leverage Ratio was approximately 10.94% for the period. This ratio significantly exceeds the current regulatory standards for well-capitalized status.

Credit Quality

The Bank's loan portfolio has continued to perform well and remains stable. At March 31, 2022 Other Real Estate Owned (OREO) decreased to $1.9 million, or by 10.9%, from December 31, 2021. Nonaccruing loans as a percentage of total loans at March 31, 2022 remained flat at a very low .02%.

President and CEO Joseph D. Borgerding commented, "Management is pleased to report a strong first quarter with earnings of $1.377 million. Net income was down $168 thousand from the record earnings posted in thefirst quarter of 2021. The decline can be attributed primarily to the reduction in government-backed small business Paycheck Protection Program (PPP) loan fees that were predominantly recognized in 2021 as these loans were forgiven. Inflation concerns have resulted in increased rates and we expect this pattern to continue throughout the remainder of the year. Rising rates will likely impact gains realized from the sale of secondary market mortgage loans, but this impact will be more than offset by the increased earnings on the Bank's securities portfolio and overnight investments. The Bank remains well-positioned for this environment as Management anticipated a rising rate environment."

About Citizens Bancorp of Virginia, Inc. and Citizens Bank and Trust Company

Citizens Bank and Trust Company was founded in 1873 and is the second oldest independent bank in Virginia. The Bank has eleven locations in the Counties of Amelia, Chesterfield, Nottoway, Mecklenburg, Powhatan and Prince Edward and one location in the City of Colonial Heights, Virginia. Citizens Bancorp of Virginia, Inc. is the parent company of the Bank and is headquartered in Blackstone, Virginia. The Company's stock trades on the OTC Bulletin Board under the symbol "CZBT". Additional information on the Company and the Bank is also available at its website:www.cbtva.com.

Cautionary Statement about Forward-Looking Statements

We caution you that certain statements in this release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Although we believe that our expectations with respect to these forward-looking statements are based upon reasonable assumptions within the bounds of our business operations, there can be no assurance that the actual results, performance or achievements of the Company will not differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. For more details on factors that could affect expectations, see the Company's Annual Report for the year ended December 31, 2021.

CITIZENS BANCORP OF VIRGINIA, INC. AND SUBSIDIARY

Consolidated Balance Sheets

(Dollars in thousands, except share data)

(Unaudited) March 31,

Assets

2022

December 31, 2021

Cash and due from banks Interest-bearing deposits in banks Federal funds sold

Securities available for sale, at fair market value Restricted securities, at cost

Loans, net of allowance for loan losses of $2,555 in 2022 and $2,761 in 2021

Premises and equipment, net Accrued interest receivable Other assets

Bank-owned life insurance

Other real estate owned, net of valuation allowance of $168 in 2022 and $164 in 2021

$

7,878

302 1,337

164,040 72,376

164,655 246,574

440

204,308 210,002

8,400 8,537

1,520 1,526

2,883 1,387

13,731 13,635

1,873 2,103

$ 9,052

403

Total assets

Liabilities and Stockholders' Equity

Liabilities

Deposits:

Noninterest-bearing Interest-bearing

Total deposits Other borrowings Accrued interest payable

Accrued expenses and other liabilities

Total liabilities

Stockholders' Equity

Preferred stock, $0.50 par value; authorized 1,000,000 shares; none outstanding

Common stock, $0.50 par value; authorized 10,000,000 shares; issued and outstanding, 2,129,613 for 2022 and 2,130,888 for 2021 Additional paid-in capital

Retained earnings

Accumulated other comprehensive loss

Total stockholders' equity

Total liabilities and stockholders' equity

$

570,030

$

566,932

$

120,361 $ 121,380

383,903 374,452

504,264 495,832

6,627 7,547

227 224

4,135 3,354

515,253

-1,065 -

61,670

(7,958)

54,777

$

570,030

506,957

-1,065 -

60,857

(1,947)

59,975

$

566,932

Consolidated Statements of Income

(Dollars in thousands, except per share data)

Interest and Dividend Income

Loans, including fees Investment securities:

Taxable

Tax-exempt

Federal funds sold Other

Total interest and dividend income

Interest Expense

Deposits Borrowings

Total interest expense

Net interest income

(Recovery of) provision for loan losses

Net interest income after (recovery of) provision for loan losses

Noninterest Income

Service charges on deposit accounts Net gain on calls of securities

Net gain on sales of loans

Income from bank-owned life insurance Interchange income, net

Other

Total noninterest income Noninterest Expense

Salaries and employee benefits Net occupancy expense Equipment expense FDIC deposit insurance

Net gain on sale of other real estate owned OREO expenses, net of rental income Other

Total noninterest expense

Income before income taxes

Income taxes

Net income

Earnings per share, basic & diluted

Three Months Ended

March 31,

(Unaudited)

2022 2021

$

3,016 $ 3,326

549 357

41 78

67 18

6 20

3,679 3,799

248 331

4 10

252 341

3,427 3,458

(200)

-

3,627 3,458

163 140

1 2

67 138

96 94

223 218

180 198

730 790

1,682 1,474

166 178

134 140

41 30

(78) (81)

22 14

683 583

2,650 2,338

1,707 1,910

330 365

$ $

1,377 $ 1,545

0.65 $ 0.72

Consolidated Regulatory Capital Ratios

And Performance Ratios

(Dollars in thousands, except per share data)

Three Months Ended

March 31,	December 31,	September 30,	June 30,	March 31,
2022	2021	2021	2021	2021

Per Share Data:

Earnings per weighted average share

Weighted average shares outstanding

Actual shares oustanding

Book value per share at period end

Dividend per share

Performance Ratios:

Return on average assets

Net interest margin, (FTE)1

Efficiency ratio2

Capital and Other Ratios:

$0.65

2,130,378 2,129,613

$ $

25.72 0.25

0.98% 2.59% 63.59%

(Ratios are period end, unless stated otherwise)

Tier 1 leverage ratio

Allowance for loan losses to total loans

Nonaccruing loans to total loans

Net charge-offs (net recoveries)

to average loans (annualized)

$0.63

2,130,961 2,130,888

$ $

28.15 0.25

0.97% 2.80% 66.03%

10.94%

11.18%

1.23%

1.30%

0.02%

0.03%

0.01%

0.00%

• 1 The net interest margin is reported on a fully taxable equivalent basis.

  $0.59

  $0.69

  $0.72

  2,132,470 2,131,138

  2,137,051 2,143,378

  2,134,631 2,142,731

  $ $

  27.76 0.25

  $ $

  27.67 $ 27.08

  0.25 $ 0.24

  0.92% 2.79% 66.31%

  1.12% 1.25%

  2.78% 3.02%

  56.87% 54.77%

  11.30%

  11.45% 11.85%

  1.30%

  1.28% 1.31%

  0.01%

  0.01% 0.06%

  -0.06%

  0.01% 0.00%

• 2 Computed by dividing noninterest expense by the sum of net interest income (on a fully taxable equivalent basis) and noninterest income.

CONTACT:Geoffrey C. Warner

EVP and Chief Financial Officer

Voice: 434-292-8100 or E-mail:[e-mail]

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