Bank of Virginia Announces Third Quarter 2009 Earnings

Bank of Virginia (Nasdaq:BOVA) (www.bankofva.com) announced the Bank's third quarter 2009 financial performance today. For the third quarter of 2009, the Bank reported net income of $530 thousand or basic earnings per share of 17 cents, versus $117 thousand or earnings per share of 4 cents, for the comparable period last year. In addition, non-performing assets, on a linked quarter basis, declined $244.5 thousand from $5.6 million at June 30, 2009 to $5.4 million at September 30, 2009. The allowance for loan losses as a percent of total loans was 2.62% at September 30, 2009. Non-performing assets, including nonaccrual loans, foreclosed real estate, and loans 90 days or more past due and still accruing, totaled $5.4 million, or 2.37% of total assets of $226.3 million at September 30, 2009.

The Bank finished the third quarter of 2009 with total assets of $226.3 million, an increase of $22.6 million or 11% from year-end 2008. During the first nine months of 2009, the Bank increased its total core deposits and loan volume. Total deposits were $201.0 million, up $30 million, or 17.5% over the year-ended 2008. At September 30, 2009, total net loans were $166.1 million compared to $153.0 million at December 31, 2008, an increase of $13.2 million or 8.6%. Income components for the quarter were comprised of operational income, securities gains and a negative provision for loan losses. The negative provision for loan losses in the third quarter was driven by the reduction in non-performing assets and recoveries on loans which had specific reserves.

The net loss for the first nine months of the year was $2.7 million, or a basic loss per share of 90 cents, compared to net income of $85 thousand or basic earnings per share of 3 cents for the first nine months of 2008. The year to date loss is primarily due to the Bank's increase in loan loss provision in the second quarter resulting from the continued deterioration in the real estate market.

Frank Bell, President & CEO commented, "We are encouraged to report that during the third quarter we were able to have solid growth in both core deposits and loans. I am also encouraged that during the third quarter the Bank experienced loan recoveries of $420,000 on certain loans that had specific reserves, and as a result, the total provision decreased. Also as a result, the specific reserves attached to these loans were reduced."

The Bank is focused on understanding and proactively addressing issues in the loan portfolio. Given the current economic struggles, the Bank has made aggressive increases to our overall loan loss reserves and collection efforts.

On a year-to-date basis, the Bank remains in a loss position principally due to the increased loan loss reserves, as well as several loans that were charged off in the second quarter 2009. The Bank's reserve for loan losses at September 30, 2009 was $4.5 million or 2.62% of total loans as compared to $2.9 million or 1.89% for year-end 2008.

Additionally, 2009 year-to-date results include an unprecedented FDIC Deposit Insurance Fund special assessment of over $100,000 in the second quarter. This assessment (based on asset size) was imposed on all FDIC insured institutions. In summary, our negative earnings position for the first nine of months of 2009 results from increased loan loss reserves driven primarily by loan growth, economic trends, strategic investments we have made through a core system conversion in growing Bank of Virginia, and an economy that continues to stress our net interest margins.

This August 2009, Bank of Virginia opened a new 3000 square foot branch office in Chesterfield County, Virginia, which was a relocation of an existing retail storefront branch. Management feels positive that with the existing shareholder and customer base that surrounds the office, it will prove to be a positive addition to Bank of Virginia.

Mr. Bell stated that he: "...expects that we will enter a written agreement with the Federal Reserve during the fourth quarter of 2009. While we do not know the exact contents of the written agreement at this time, we expect that it will require us to implement plans to improve our risk management and compliance systems, oversight functions, operating and financial management and capital plans. We also expect to curb asset growth and focus on improving profitability until capital levels are increased."

In addition, the Bank today announced that it intends to offer up to $10 million of common stock in lieu of its offering of investment units. McKinnon & Company, Inc. will serve as the underwriter for this offering and will conduct the offering on a best-efforts basis.

The securities being offered have not been, and will not be, registered under the Securities Act of 1933, as amended (the "Securities Act") or any state securities laws, and are being offered and sold in reliance on exemptions from the registration requirements of the Securities Act and such state laws. A copy of the offering circular relating to the offering may be obtained from McKinnon & Company, Inc., Norfolk, Virginia (www.mckinnonco.com) by telephone at (800) 853-4636.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful.

Bank of Virginia, a Virginia state chartered bank headquartered in Midlothian, Virginia currently operates five full-service offices in the counties of Chesterfield and Henrico, Virginia. Bank of Virginia common stock is traded on the NASDAQ stock market under the quotation symbol "BOVA". Additional investor relations information can be found on the internet at www.bankofva.com.

DISCLAIMER

This news release may include forward-looking statements. These forward-looking statements are based on current expectations that involve risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may differ materially. These risks include: changes in business or other market conditions; the timely development, production and acceptance of new products and services; the challenge of managing asset/liability levels; the management of credit risk and interest rate risk; the difficulty of keeping expense growth at modest levels while increasing revenues; and other risks detailed from time to time in the Bank's periodic filings with the Board of Governors of the Federal Reserve System, including the Bank's annual report on Form 10-K as filed with the Board of Governors of the Federal Reserve. Pursuant to the Private Securities Litigation Reform Act of 1995, the Bank does not undertake to update forward-looking statements contained within this news release.

 BANK OF VIRGINIA
 Statements of Operations
 (Unaudited)

                          Three Months               Nine Months
                        and Period Ended          and Period Ended
                    ------------------------  ------------------------
                          September 30,             September 30,
                        2009         2008         2009         2008
                    -----------  -----------  -----------  -----------

 Interest
  Income:
   Interest and fees
    on loans        $ 2,546,598  $ 2,602,195  $ 7,461,677  $ 7,624,427
   Investment
    securities          528,506      517,698    1,597,999    1,636,512
   Interest on
    federal funds
    sold and
    deposits with
    banks                 1,913       12,384        5,602       64,289
                    -----------  -----------  -----------  -----------
     Total interest
      income          3,077,017    3,132,277    9,065,278    9,325,228
                    -----------  -----------  -----------  -----------

 Interest
  Expense:
   Interest on
    deposits          1,389,661    1,550,136    4,296,035    4,907,023
   Interest on fed
    funds purchased
    and FHLB
    borrowings          115,773      144,348      353,742      395,493
                    -----------  -----------  -----------  -----------
     Total interest
      expense         1,505,434    1,694,484    4,649,777    5,302,516
                    -----------  -----------  -----------  -----------
     Net interest
      income          1,571,583    1,437,793    4,415,501    4,022,712
   Provision for
    loan losses        (181,576)     105,574    3,458,699      248,825
                    -----------  -----------  -----------  -----------
     Net interest
      income after
      provision for
      loan losses     1,753,159    1,332,219      956,802    3,773,887
                    -----------  -----------  -----------  -----------

 Non-interest
  Income:
   Service charges
    on deposit
    accounts             42,441       63,991      136,443      168,051
   Net gain on
    available for
    sale securities     119,361       25,405      275,293      149,069
   Other fee income      46,895       35,273      144,442       99,767
                    -----------  -----------  -----------  -----------
     Total non-
      interest
      income            208,697      124,669      556,178      416,887
                    -----------  -----------  -----------  -----------

 Non-interest
  Expense:
   Salaries and
    employee
    benefits            826,966      789,538    2,400,192    2,340,768
   Occupancy expense    105,208       99,844      328,898      304,520
   Equipment expense     56,358       80,259      171,011      236,190
   Data processing      127,435      106,526      354,064      308,863
   Marketing expense     30,778       20,948       87,372      161,879
   Legal and pro-
    fessional fees       41,970       46,684      120,040      152,632
   FDIC insurance
    assessments          36,345       22,264      203,906       66,311
   Other operating
    expenses            206,427      173,518      573,684      534,838
                    -----------  -----------  -----------  -----------
     Total non-
      interest
      expenses        1,431,487    1,339,581    4,239,167    4,106,001
                    -----------  -----------  -----------  -----------

     Net income
      (loss)        $   530,369  $   117,307  $(2,726,187) $    84,773
                    ===========  ===========  ===========  ===========

   Income (loss) per
    share, basic and
    diluted         $      0.17  $      0.04  $     (0.90) $      0.03
                    ===========  ===========  ===========  ===========
   Weighted Average
    Shares
     Outstanding:
     Basic            3,031,866    3,031,866    3,031,866    3,031,866
                    ===========  ===========  ===========  ===========
     Diluted          3,031,866    3,031,866    3,031,866    3,033,028
                    ===========  ===========  ===========  ===========
   At period end:
     Book value
      per share            4.77         5.66
     Market value
      per share            3.71         6.30
     Tangible common
      equity to
      assets               6.39%        8.71%


 BANK OF VIRGINIA
 Balance Sheets

                                       September 30,     December 31,
                                           2009              2008
                                         Unaudited         Audited
                                       -------------    -------------
 Assets
   Cash and due from banks             $   3,204,538    $   2,608,500
   Federal funds sold and interest-
    bearing balances with banks            4,177,664           42,194
                                       -------------    -------------
                                           7,382,202        2,650,694
   Securities available for sale, at
    fair market value                     44,010,046       39,474,175
   Restricted securities                   1,531,200        1,534,550
   Loans, net of allowance for loan
    losses of $4,476,947 in 2009 and
    $2,942,988 in 2008                   166,141,103      152,962,046
   Premises and equipment, net             5,854,685        5,688,585
   Accrued interest receivable               830,198          864,630
   Other real estate owned                   308,019          308,019
   Other assets                              265,522          229,220
                                       -------------    -------------

     Total assets                      $ 226,322,975    $ 203,711,919
                                       =============    =============

 Liabilities
   Deposits:
   Noninterest-bearing                 $  15,997,362    $  12,483,762
   Savings and interest-bearing demand    28,231,758       18,770,259
   Time, $100,000 and over                67,233,095       55,939,332
   Other time                             89,508,597       83,818,330
                                       -------------    -------------
   Total deposits                        200,970,812      171,011,683
   Accrued expenses and other
    liabilities                              898,556        1,208,215
   FHLB borrowings                        10,000,000       15,000,000
   Federal funds purchased                        --          176,000
                                       -------------    -------------
     Total liabilities                   211,869,368      187,395,898
                                       -------------    -------------

 Stockholders' Equity
   Preferred stock, $5 par value,
    5,000,000 shares authorized, none
    issued                                        --               --
   Common stock, $2.50 par value,
    40,000,000 shares authorized,
    3,031,866 shares issued and
    outstanding in 2009 and 2008,
    respectively                           7,579,665        7,579,665
   Additional paid-in capital             14,713,504       14,705,508
   Retained (deficit)                     (8,640,128)      (5,913,941)
   Accumulated other comprehensive
    income (loss)                            800,566          (55,211)
                                       -------------    -------------
     Total stockholders' equity           14,453,607       16,316,021
                                       -------------    -------------

     Total liabilities and
      stockholders' equity             $ 226,322,975    $ 203,711,919
                                       =============    =============


 BANK OF VIRGINIA
 Selected Historical Information
 (Unaudited)
 As of and for the Quarter Ended


                Sept. 30,   June 30,   March 31,  Dec. 31,   Sept. 30,
                  2009        2009       2009       2008       2008
                ---------  ----------  ---------  ---------  ---------

 Asset Quality
  Analysis:

 Allowance for
  loan losses:
 Beginning
  balance       4,690,071   3,012,738  2,942,988  1,525,551  1,419,977
  Provision      (181,575)  3,570,525     69,750  1,515,500    105,574
  Charge-offs     (31,549) (1,893,192)        --    (98,063)        --
  Recoveries           --          --         --         --         --
                ---------  ----------  ---------  ---------  ---------
  Net charge-
   offs           (31,549) (1,893,192)        --    (98,063)        --
                ---------  ----------  ---------  ---------  ---------
   Ending
    Balance     4,476,947   4,690,071  3,012,738  2,942,988  1,525,551
                =========  ==========  =========  =========  =========


 Nonperforming
  Assets:
 Nonaccrual
  loans         5,065,056   4,541,510         --    244,273    413,195
 Foreclosed
  real estate     308,019     308,019    308,019    308,019         --
 Loans 90 days
  or more past
  due and still
  accruing             --     768,088  3,197,350    696,000    691,500
                ---------  ----------  ---------  ---------  ---------
   Nonperforming
    assets      5,373,075   5,617,617  3,505,369  1,248,292  1,104,695
                =========  ==========  =========  =========  =========

 Allowance for
  loan losses as
  a percent of
  loans              2.62%       2.82%      1.89%      1.89%      1.00%
 Non-performing
  assets to
  total assets       2.37%       2.49%      1.58%      0.61%      0.55%

This news release was distributed by GlobeNewswire, www.globenewswire.com

SOURCE: Bank of Virginia

CONTACT:  Bank of Virginia
Kenneth P. Mulkey, Senior Vice-President
& Chief Financial Officer
804-763-1333

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