Company: CVBF
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0000950170-25-029985
Chunk: 195

Company: CVB FINANCIAL CORP
Filing Date: 2025-02-28
Form: 10-K
Item: Item 1B
Chunk 195
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 balance sheet cash 

76

flows are critical in the EVE analysis. Particularly important are the assumptions driving prepayments and the expected duration and pricing of the indeterminate deposit portfolios. EVE sensitivity is reported in both upward and downward rate shocks. At December 31, 2024, the EVE profile indicates a decline in the EVE Ratio value due to instantaneous downward changes in rates and a modest increase in the EVE Ratio under upward rate shocks.  Compared to December 31, 2023, our EVE sensitivity to rising rates was modestly higher, as the EVE Ratio declined minimally at the end of 2023, while the decline in the EVE Ratio under declining rates was consistent across the two periods. Overall, our sensitivity of EVE to changes in interest rates is generally modest, with the exception of more meaningful decreases in the EVE Ratio if rates were to immediately decline by 300 or 400 basis points. 

Economic Value of Equity Sensitivity 

    December 31,

    2024

    2023

    400 bp decrease in interest rates

    15.7
    %

    14.7
    %

    300 bp decrease in interest rates

    17.1
    %

    15.5
    %

    200 bp decrease in interest rates

    17.9
    %

    16.3
    %

    100 bp decrease in interest rates

    18.4
    %

    16.8
    %

    Base

    19.0
    %

    17.1
    %

    100 bp increase in interest rates

    19.2
    %

    17.0
    %

    200 bp increase in interest rates

    19.6
    %

    17.1
    %

    300 bp increase in interest rates

    19.8
    %

    16.9
    %

    400 bp increase in interest rates

    20.0
    %

    16.7
    %

As EVE measures the discounted present value of cash flows over the estimated lives of instruments, the change in EVE does not directly correlate to the degree that earnings would be impacted over a shorter time horizon (i.e., the current year). Further, EVE does not take into account factors such as future balance sheet growth, changes in asset and liability mix, changes in yield curve relationships, and changing product spreads that could mitigate the adverse impact of changes