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Section 2 - Financial Information Item 2.02 . Results of Operations and Financial Condition GALLIPOLIS , Ohio - Ohio Valley Banc Corp. [ Nasdaq : OVBC ] ( the " Company " ) reported consolidated net income for the quarter ended March 31 , 2021 , of $ 3,531,000 , an increase of $ 2,529,000 from the same period the prior year . Earnings per share for the first quarter of 2021 was $ .74 , compared to $ .21 for the first quarter of 2020. Return on average assets and return on average equity were 1.20 % and 10.47 % , respectively , for the first quarter of 2021 , versus .40 % and 3.14 % , respectively , for the same period the prior year . " A fantastic quarter as our communities begin to emerge from the pandemic and move into 2021. However , our management team remains vigilant as interest rates continue at an extreme low and the boon seen from government pandemic recovery programs wane , ” said Chairman and CEO Tom Wiseman . Wiseman also noted an encouraging increase in income from mortgage banking and interchange fees for the quarter . For the first quarter of 2021 , net interest income increased $ 44,000 from the same period last year . For the three months ended March 31 , 2021 , average earning assets increased $ 170 million from the same period the prior year . The increase was partly due to average loans , which increased $ 72 million from the first quarter of last year in relation to higher commercial loan balances . Approximately $ 27 million of the growth in average loans was related to the Company's participation in the SBA's Paycheck Protection Program ( PPP ) to assist various businesses in our market during the pandemic . Also contributing to earning asset growth was the $ 83 million increase in average balances maintained at the Federal Reserve . In relation to the various stimulus payments received by customers , the Company experienced a significant increase in deposit balances and , to the extent those deposits are not invested in loans or investments , they are invested at the Federal Reserve to be readily available for future funding needs . The earnings contribution from the higher balance of earning assets was mostly offset by a decrease in the net interest margin . For the quarter ended March 31 , 2021 , the net interest margin was 3.73 % , compared to 4.34 % for the same period the prior year . The decrease was primarily related to the actions taken by the Federal Reserve to reduce interest rates by 150 basis points in March of 2020. In relation to the decrease in market rates , the Company experienced a greater decrease in yield on earning assets than the average cost on interest - bearing liabilities . This trend was partly due to certain deposits already being at or near their interest rate floor , which limited the Company's ability to reduce deposit costs to the same magnitude as experienced on earning assets . Furthermore , the current rate on balances maintained at the Federal Reserve is .10 % and , when combined with the heightened balances it has a dilutive effect on the net interest margin . For the three months ended March 31 , 2021 , the provision for loan loss expense was negative $ 52,000 , a decrease of $ 3,898,000 from the first quarter of 2020. The negative provision for loan loss expense for the first quarter of 2021 was primarily related to lower general reserves in association with improved economic risk factors and a decrease in loan balances since December 31 , 2020 , which was partly offset by quarterly net charge - offs of $ 222,000 . The decrease in provision for loan loss expense from the prior year first quarter was due to a decrease in net loan charge - offs of $ 1,168,000 and to the provision expense associated with the establishment of an economic risk factor for the pandemic during the first quarter of 2020 , which resulted in additional provision expense of $ 1,942,000 . The allowance for loan losses was .83 % of total loans at March 31 , 2021 , compared to .84 % at December 31 , 2020 and 1.13 % at March 31 , 2020 . For the first quarter of 2021 , noninterest income totaled $ 3,339,000 , a decrease of $ 1,103,000 from the first quarter of 2020. The decrease was primarily due to the receipt of a $ 2,000,000 settlement payment from a third - party tax software product provider for early termination of its contract during the first quarter of 2020. As part of the settlement agreement , the Bank is scheduled to process a certain amount of tax items starting in 2021 and ending in 2025. For the first quarter of 2021 , the Bank recognized $ 540,000 of additional income under the agreement . This income along with higher interchange fees of $ 107,000 , lower losses on foreclosed properties of $ 102,000 and higher mortgage banking income of $ 89,000 , partially offset this year's decrease in noninterest income related to the litigation settlement payment received the prior year . Noninterest expense totaled $ 9,187,000 for the first quarter of 2021 , a decrease of $ 332,000 , or 3.5 % , from the same period last year . The Company's largest noninterest expense , salaries and employee benefits , decreased $ 185,000 , or 3.4 % , from the first quarter of 2020. The decrease was primarily related to the expense savings associated with a lower number of employees . Further contributing to lower noninterest expense was professional fees . For the three months ended March 31 , 2021 , professional fees decreased $ 168,000 from the same period last year due to lower legal fees associated with collecting troubled loans . Partially offsetting the expense reductions above was an increase in software expense , which increased $ 68,000 from the prior year first quarter . The increase was mostly due to software utilized to process PPP loan applications . Lastly , FDIC insurance expense increased $ 79,000 from the first quarter of last year since there was no FDIC insurance expense incurred in the first quarter of 2020 as a result of assessment credits received from the FDIC . The Company's total assets at March 31 , 2021 were $ 1.225 billion , an increase of $ 38 million , or 3.2 % , from December 31 , 2020. The increase in assets was related to a $ 38 million increase in cash and cash equivalents . The increase in cash and cash equivalents was related to the heightened deposit balances received during the first quarter of 2021 from additional stimulus payments received by customers . At March 31 , 2021 , total deposits increased $ 39 million , or 3.9 % , from year end 2020 . Ohio Valley Banc Corp. common stock is traded on the NASDAQ Global Market under the symbol OVBC . The holding company owns The Ohio Valley Bank Company , with 15 offices in Ohio and West Virginia , and Loan Central , with six consumer finance offices in Ohio . Learn more about Ohio Valley Banc Corp. at www.ovbc.com . Caution Regarding Forward - Looking Information Certain statements contained in this earnings release that are not statements of historical fact constitute forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “ believes , ” “ anticipates , ” “ expects , ” “ appears , ” “ intends , ” “ targeted ” and similar expressions are intended to identify forward - looking statements but are not the exclusive means of identifying those statements . Forward - looking statements involve risks and uncertainties . Actual results may differ materially from those predicted by the forward - looking statements because of various factors and possible events , including : ( i ) impacts from the novel coronavirus ( COVID - 19 ) pandemic on our business , operations , customers and capital position ; ( ii ) higher default rates on loans made to our customers related to COVID - 19 and its impact on our customers ' operations and financial condition ; ( iii ) the impact of COVID - 19 on local , national and global economic conditions ; unexpected changes in interest rates or disruptions in the mortgage market related to COVID - 19 or responses to the health crisis ; ( iv ) the effects of various governmental responses to the COVID - 19 pandemic ; ( v ) changes in political , economic or other factors , such as inflation rates , recessionary or expansive trends , taxes , the effects of implementation of federal legislation with respect to taxes and government spending and the continuing economic uncertainty in various parts of the world ; ( vi ) competitive pressures ; ( vii ) fluctuations in interest rates ; ( viii ) the level of defaults and prepayment on loans made by the Company ; ( ix ) unanticipated litigation , claims , or assessments ; ( x ) fluctuations in the cost of obtaining funds to make loans ; ( xi ) regulatory changes ; ( xii ) and other factors that may be described in the