Freedom Bank of Virginia Announces Third Quarter 2010 Results

The Third Quarter of 2010 completes the sixth consecutive quarter of increased Net Income when compared to the same quarter a year earlier. The Bank (Bulletin Board: FDVA.OB) achieved profitability in the Second Quarter, 2009 and has remained profitable on a monthly and quarterly basis ever since.

The results are due to new customers moving their banking business to Freedom Bank which has increased the amount of loans outstanding and funds on deposit. Growth of new customer relationships has been consistent since the Bank opened in 2001 because of the focus on outstanding customer service.

Net Income for the Third Quarter 2010 is $561,600. The Net Income is substantially higher than the Third Quarter of 2009 in which the Bank posted Net Income of $238,305 and also higher than the Second Quarter of 2010 in which the Bank posted Net Income of $457,498. Comparison on a percentage basis has Net Income increasing 135% compared to the Second Quarter 2009 and increasing 22% compared to the Second Quarter 2010. This marks the sixth consecutive quarter of improved Net Income in comparison to the same quarter the previous year. Measured on a per share basis, Net Income was $0.24 per share in the Third Quarter 2010 compared to $0.10 per share in the Third Quarter 2009.

The bottom line improvement has been driven by top line increases. The top line is interest income which increased to $2,373,275 during the Third Quarter 2010 from $2,140,410 during the Third Quarter, 2009. The percentage increase is 10.8% from the Third Quarter 2009 to the Third Quarter 2010 and 3.9% from the Second Quarter 2010 to the Third Quarter 2010.

Interest Expense decreased to $585,087 in the Third Quarter 2010 from $701,295 in the Third Quarter 2009. Combining increased Interest Income and decreased Interest Expense led to a substantial increase in Net Interest Income. Net Interest Income for the Third Quarter 2010 was $1,788,188 which is an increase of $349,073 from the Third Quarter 2009 which was $1,439,115.

The Bank made no Provision for Possible Loan Losses in the Third Quarter 2010. In the Third Quarter, 2009 the Provision was $382,000.

Operating Expenses increased $146,266 or 15.4% from the Third Quarter 2009 to the Second Quarter 2010. Compensation, benefits, occupancy, insurance, professional fees, data processing, business development and other expense all increased.

The Balance Sheet shows continued growth. Loans Receivable increased $6,654,733 or 5.1%, up from $130,053,233 as of September 30, 2009 to $136,707,966 as of September 30, 2010. Total Deposits increased to $155,021,518, up from $131,704,089, an increase of 17.7%.

The Bank now has assets under management totaling $176,147,204. Total Assets increased 16.4% from the Third Quarter 2009 to the Third Quarter, 2010.

The Board of Directors and management are pleased to report increased earnings and growth.