CVB Financial : Statement of Condition - Q2 2023

STATEMENT OF

CONDITION

June 30, 2023

President's Message

CVB Financial Corp. (CVBF) reported net earnings of $55.8 million for the quarter ended June 30, 2023, compared with $59.3 million for the first quarter of 2023. We announced our 185th consecutive quarter of profitability and our 135th consecutive quarter of paying a cash dividend to our shareholders. Our net interest margin, on a tax equivalent basis, was 3.22% for the second quarter of 2023, while our efficiency ratio was 40.86%. Since our Bank's founding in 1974, we have managed to build a safe, sound, and secure institution with a strategy focused on banking the best small to medium-sized businesses and their owners. We remain focused on our Core Values of Financial Strength, Superior People, Customer Focus, Cost-Effective Operation, and Having Fun. As the premier business bank in California, we have successfully executed on this strategy, and our focus will remain steady and consistent, so we can continue to provide the best banking products and services to these businesses that represent Great American Success Stories.

Our Bank continues to attract new relationships, including the extension of new credit to our customers, as well as the acquisition of new deposit customers. Although current economic conditions have slowed loan demand across the banking industry, our deposit pipeline has strengthened and grown over the second quarter. New deposit accounts opened during the first half of 2023 provided our Bank with approximately $650 million in average new deposits. Importantly, our deposits are 100% core customer relationships, across diversified industries, and our Bank has no brokered deposits. More than 75% of our deposits represent customer relationships that have banked with Citizens Business Bank for three years or more.

In keeping with our commitment to the communities we serve, we recently hosted our 38th Annual Charity Golf Classic, which raised more than $115,000 for the benefit of Orange County charitable community organizations.

CitizensTrust, our wealth management division that provides trust, investment, and brokerage- related services, as well as financial, estate, and business succession planning, had approximately $3.61 billion in assets under management and administration, including $2.41 billion in assets under management, at quarter end.

Shares of CVB Financial Corp. common stock are listed on Nasdaq under the ticker symbol "CVBF". If you are new to CVB Financial Corp. and would like more information about Citizens Business Bank, our principal financial services subsidiary, please visit us on our website at cbbank.com. Additional information about CVB Financial Corp. is available on our Citizens Business Bank website under the "Investors" tab.

We continue to focus on executing on our core strategies and supporting our customers through these demanding times. On behalf of our Board of Directors and all of our hard-working associates, we thank our customers and shareholders for their continued loyalty and support.

President & Chief Executive Officer

CVB Financial Corp., Citizens Business Bank

#1 Best Bank	Five-Star	Super Premier
IN AMERICA	SUPERIOR RATING	PERFORMING BANK
Forbes, 2023	BauerFinancial, 2023	Findley Reports, 2023

Board of Directors
Hal W. Oswalt	George A. Borba
Chairman	Vice Chairman
David A. Brager	Jane Olvera Majors
President and CEO	Director
Stephen A. Del Guercio	Raymond V. O'Brien III
Director	Director
Anna Kan	Kimberly Sheehy
Director	Director
Leadership Team
David A. Brager	E. Allen Nicholson
President and CEO	EVP, Chief Financial Officer
David C. Harvey	David F. Farnsworth
EVP, Chief Operating Officer	EVP, Chief Credit Officer
Richard H. Wohl	R. Daniel Banis
EVP, General Counsel	EVP, CitizensTrust
Yamynn De Angelis	Ted J. Dondanville
EVP, Chief Risk Officer	EVP, Banking Division
Hector G. Gutierrez, Esq.	Susan M. Mlot
EVP, Deputy Chief Credit Officer	EVP, Head of Operations
Timothy B. Noone	G. Larry Zivelonghi
EVP, Specialty Banking	EVP, Dairy & Livestock Industries
Jeffrey S. Boyer	Michael K. Currie
SVP, Los Angeles Region-North	SVP, Chief Information Officer
Gilbert W. Estrada	Donald E. Evenson
SVP, Inland Empire Region	SVP, Chief Investment Officer
Richard M. Favor	Deborah G. Gallagher
SVP, Central Coast Region	SVP, SBA Group
Derrick I. Hong	Joyce Y. Kwon
SVP, Chief Audit Executive	SVP, Director of Human Resources
Daniel Limon	Michael B. Mulcahy
SVP, Specialty Lending Group	SVP, Los Angeles Region-Metro
Rudy I. Ramirez	Mark C. Richardson
SVP,Chief Information SecurityOfficer	SVP, Real Estate Banking
LaVon M. Short	Michael D. Stain
SVP, Director of Treasury	SVP, Central Valley Region
Management and Marketing	Robert E. Zeltner
David S. Stong
SVP, Orange County Region
SVP, San Diego Region

135

consecutive quarters of cash dividends paid

185

consecutive quarters

of profitability

$55.8 million

net income

as of 6.30.23

Financials

CVB Financial Corp. ("CVBF") is the holding company for Citizens Business Bank. CVBF is one of the 10 largest bank holding companies headquartered in California with over $16 billion in total assets. Citizens Business Bank is consistently recognized as one of the top performing banks in the nation and offers a wide array of banking, lending and investing services with more than 60 banking centers and 3 trust office locations serving California.

Condensed Consolidated Balance Sheets

	(Dollars in thousands, except share amounts)		June 30,		December 31,
	(Unaudited)		2023		2022
Assets
	Cash and due from banks	$	231,316	$	158,236
	Interest-earning balances due from Federal Reserve		387,039		45,225
	Total cash and cash equivalents		618,355		203,461
	Interest-earning balances due from depository institutions		30,478		9,553
	Investment securities available-for-sale, at fair value
	(with amortized cost of $3,576,937 at June 30, 2023,
	and $3,755,297 at December 31, 2022)		3,068,151		3,255,211
	Investment securities held-to-maturity (with fair value of
	$2,108,653 at June 30, 2023, and $2,155,587 at
	December 31, 2022)		2,512,707		2,554,301
	Total investment securities		5,580,858		5,809,512
	Investment in stock of Federal Home Loan Bank (FHLB)		29,484		27,627
	Loans and lease finance receivables		8,907,397		9,079,392
	Allowance for credit losses		(86,967)		(85,117)
	Net loans and lease finance receivables		8,820,430		8,994,275
	Premises and equipment, net		45,518		46,698
	Bank owned life insurance (BOLI)		257,348		255,528
	Accrued interest receivable		46,545		46,692
	Intangibles		18,303		21,742
	Goodwill		765,822		765,822
	Income taxes		146,977		186,684
	Other assets		124,426		108,946
	Total assets	$	16,484,544	$	16,476,540
Liabilities and Stockholders' Equity
	Liabilities:
	Deposits:
	Noninterest-bearing	$	7,878,810	$	8,164,364
	Interest-bearing		4,518,711		4,671,881
	Total deposits		12,397,521		12,836,245
	Customer repurchase agreements		452,373		565,431
	Other borrowings		1,495,000		995,000
	Deferred compensation		23,095		22,092
	Other liabilities		115,188		109,255
	Total liabilities		14,483,177		14,528,023
Commitments and Contingencies
Stockholders' Equity
	Common stock, authorized, 225,000,000 shares without
	par; issued and outstanding 139,343,284 at June 30,
	2023, and 139,818,703 at December 31, 2022		1,284,150		1,300,466
	Retained earnings		1,062,093		1,002,847
	Accumulated other comprehensive (loss) income, net of tax		(344,876)		(354,796)
	Total stockholders' equity		2,001,367		1,948,517
	Total liabilities and stockholders' equity	$	16,484,544	$	16,476,540

Condensed Consolidated Statements of Earnings

(Dollars in thousands, except per share amounts)		Three Months Ended June 30,
(Unaudited)		2023			2022
Interest income:
Loans and leases, including fees	$	110,990		$	92,770
Investment securities:
Investment securities available-for-sale		19,356			17,042
Investment securities held-to-maturity		13,740			11,714
Total investment income		33,096
			28,756
Dividends from FHLB stock		483			273
Interest-earning deposits with other institutions		4,670			1,463
Total interest income		149,239			123,262
Interest expense:
Deposits		10,765			1,201
Borrowings and customer repurchase agreements		18,939			121
Total interest expense		29,704			1,322
Net interest income before provision for credit losses		119,535			121,940
Provision for credit losses		500			3,600
Net interest income after provision for credit losses		119,035			118,340
Noninterest income:
Service charges on deposit accounts		4,838			5,333
Trust and investment services		3,315			2,962
Bankcard services		490			310
BOLI income		2,097			603
Gain on sale of building, net		-			2,717
Other		1,916			2,745
Total noninterest income		12,656			14,670
Noninterest expense:
Salaries and employee benefits		33,548			31,553
Occupancy and equipment		5,517			5,567
Professional services		2,562			2,305
Computer software expense		3,316			3,103
Marketing and promotion		1,321			1,638
Provision for unfunded loan commitments		400			-
Amortization of intangible assets		1,719			1,998
Acquisition related expenses		-			375
Other		5,634			4,332
Total noninterest expense		54,017			50,871
Earnings before income taxes		77,674			82,139
Income taxes		21,904			23,081
Net earnings	$	55,770		$	59,058
Basic earnings per common share	$	0.40		$	0.42
Diluted earnings per common share	$	0.40		$	0.42
Cash dividends declared per common share	$	0.20		$	0.19

CVB Financial Corp.
Citizens Business Bank
Corporate Headquarters
909.980.4030 | cbbank.com	Equal Housing Lender | Member FDIC