SOURCE: National Bankshares, Inc.

National Bankshares, Inc.

October 23, 2014 16:30 ET

National Bankshares, Inc. Reports Income for the Nine Months Ended September 30, 2014

BLACKSBURG, VA--(Marketwired - Oct 23, 2014) - Today, National Bankshares, Inc. (NASDAQ: NKSH) announced net income of approximately $12.78 million through September 30, 2014 compared to $13.17 million reported for the first nine months of 2013. Basic earnings per share were $1.84 which compares with $1.90 reported at September 30, 2013. The return on average assets for the nine months ended September 30, 2014 was 1.53% compared to 1.61% in 2013. The return on average equity was 10.99% and 11.70% for the same two periods. At September 30, 2014, the Company had total assets of almost $1.12 billion.

National Bankshares' Chairman, President & CEO James G. Rakes commented, "We continue to seek ways to grow our bank and build value for our stockholders. We have money to lend and are ready to assist with our customers' financial needs. While there continues to be aggressive competition for loan and deposit growth, we are staying true to our community banking fundamentals by delivering the very best products and personal customer service in the communities that we serve." 

National Bankshares, Inc., headquartered in Blacksburg, Virginia, is the parent company of The National Bank of Blacksburg, which does business as National Bank, and of National Bankshares Financial Services, Inc. National Bank is a community bank operating from 25 offices throughout Southwest Virginia. National Bankshares Financial Services, Inc. is an investment and insurance subsidiary in the same trade area. The Company's stock is traded on the NASDAQ Capital Market under the symbol "NKSH." Additional information is available at www.nationalbankshares.com.

Forward-Looking Statements

Certain statements in this press release may be "forward-looking statements." Forward-looking statements are statements that include projections, predictions, expectations or beliefs about future events or results that are not statements of historical fact and that involve significant risks and uncertainties. Although the Company believes that its expectations with regard to forward-looking statements are based upon reasonable assumptions within the bounds of its existing knowledge of its business and operations, there can be no assurance that actual Company results will not differ materially from any future results implied by the forward-looking statements. Actual results may be materially different from past or anticipated results because of many factors, some of which may include changes in economic conditions, the interest rate environment, legislative and regulatory requirements, new products, competition, changes in the stock and bond markets and technology. The Company does not update any forward-looking statements that it may make.

 
 
National Bankshares, Inc. and Subsidiaries
Consolidated Balance Sheets
(Unaudited)
                   
($ in thousands, except for share and per share data)   September 30, 2014     September 30, 2013     December 31, 2013  
Assets                        
Cash and due from banks   $ 12,815     $ 13,806     $ 13,283  
Interest-bearing deposits     87,621       63,452       98,066  
Federal funds sold     ---       ---       ---  
Securities available for sale, at fair value     205,020       190,264       181,712  
Securities held to maturity     162,457       164,752       163,983  
Restricted stock     1,089       1,414       1,414  
  Total securities     368,566       356,430       347,109  
Mortgage loans held for sale     725       617       1,276  
Loans:                        
  Loans, net of unearned income and deferred fees     595,801       590,664       595,690  
  Less: allowance for loan losses     (8,031 )     (8,090 )     (8,227 )
    Loans, net     587,770       582,574       587,463  
Premises and equipment, net     9,445       10,025       9,951  
Accrued interest receivable     5,708       6,044       5,949  
Other real estate owned     5,145       973       4,712  
Intangible assets and goodwill     7,492       8,568       8,299  
Bank-owned life insurance     21,643       21,020       21,181  
Other assets     9,329       13,894       13,341  
    Total assets   $ 1,116,259     $ 1,077,403     $ 1,110,630  
                         
Liabilities and Stockholders' Equity                        
Noninterest-bearing deposits   $ 153,118     $ 147,928     $ 142,645  
Interest-bearing demand deposits     492,005       453,044       501,541  
Savings deposits     79,870       73,952       74,141  
Time deposits     223,930       248,574       241,709  
    Total deposits     948,923       923,498       960,036  
Other borrowed funds     ---       ---       ---  
Accrued interest payable     67       97       92  
Other liabilities     4,447       7,514       4,610  
    Total liabilities     953,437       931,109       964,738  
                         
Stockholders' Equity                        
Preferred stock, no par value, 5,000,000 shares authorized; none issued and outstanding     ---       ---       ---  
Common stock of $1.25 par value. Authorized 10,000,000 shares; issued and outstanding, 6,950,474 shares in 2014 and 6,947,974 shares in 2013     8,688       8,685       8,685  
Retained earnings     163,181       153,578       154,171  
Accumulated other comprehensive loss, net     (9,047 )     (15,969 )     (16,964 )
    Total stockholders' equity     162,822       146,294       145,892  
    Total liabilities and stockholders' equity   $ 1,116,259     $ 1,077,403     $ 1,110,630  
                         
 
National Bankshares, Inc. and Subsidiaries
Consolidated Statements of Income
(Unaudited)
             
    Three Months Ended     Nine Months Ended  
    September 30, 2014   September 30, 2013     September 30, 2014     September 30, 2013  
($ in thousands, except for share and per share data)                              
Interest Income                              
Interest and fees on loans   $ 7,766   $ 8,196     $ 23,520     $ 24,707  
Interest on federal funds     ---     ---       ---       ---  
Interest on interest-bearing deposits     64     45       193       161  
Interest on securities - taxable     1,718     1,722       5,068       4,928  
Interest on securities - nontaxable     1,436     1,581       4,410       4,847  
  Total interest income     10,984     11,544       33,191       34,643  
Interest Expense                              
Interest on time deposits of $100 or more     139     196       437       694  
Interest on other deposits     1,008     1,192       3,320       3,921  
Interest on borrowed funds     ---     ---       ---       ---  
  Total interest expense     1,147     1,388       3,757       4,615  
  Net interest income     9,837     10,156       29,434       30,028  
Provision for loan losses     356     303       1,160       1,329  
Net income after provision for loan losses     9,481     9,853       28,274       28,699  
Noninterest Income                              
Service charges on deposit accounts     634     709       1,833       1,922  
Other service charges and fees     42     37       145       139  
Credit card fees     929     834       2,687       2,427  
Trust Income     296     267       921       867  
Bank-owned life insurance     174     182       526       546  
Other income     163     183       669       687  
Realized securities gains (losses), net     4     (62 )     5       (44 )
  Total noninterest income     2,242     2,150       6,786       6,544  
Noninterest Expense                              
Salaries and employee benefits     2,948     3,031       8,954       8,963  
Occupancy and furniture and fixtures     408     394       1,265       1,230  
Data processing and ATM     426     477       1,183       1,288  
FDIC assessment     147     136       411       408  
Credit card processing     673     656       1,887       1,854  
Intangibles and goodwill amortization     269     269       807       809  
Net cost of other real estate owned     98     52       259       192  
Franchise taxes     308     280       874       803  
Other operating expenses     859     848       2,738       2,697  
  Total noninterest expense     6,136     6,143       18,378       18,244  
Income before income tax expense     5,587     5,860       16,682       16,999  
Income tax expense     1,324     1,343       3,906       3,831  
  Net income   $ 4,263   $ 4,517     $ 12,776     $ 13,168  
Basic net income per share   $ 0.61   $ 0.65     $ 1.84     $ 1.90  
Fully diluted net income per share   $ 0.61   $ 0.65     $ 1.84     $ 1.89  
Weighted average number of common shares outstanding                              
  Basic     6,948,681     6,947,974       6,948,212       6,947,974  
  Diluted     6,956,777     6,972,769       6,960,444       6,970,063  
Dividends declared per share     ---     ---     $ 0.55     $ 0.54  
Dividend payout ratio     ---     ---       29.91 %     28.49 %
Book value per share     ---     ---     $ 23.43     $ 21.06  
 
National Bankshares, Inc. and Subsidiaries
Consolidated Statements of Comprehensive Income
(Unaudited)
       
    Three Months Ended  
($ in thousands)   September 30, 2014     September 30, 2013  
Net income   $ 4,263     $ 4,517  
                 
Other Comprehensive Income, net of tax                
Unrealized holding gains (losses) on available for sale securities net of deferred tax of $919 in 2014 and ($2,048) in 2013     1,708       (3,804 )
Reclassification adjustment, net of income tax (benefit) of ($1) in 2014 and $24 in 2013     (3 )     44  
Other comprehensive income (loss), net of tax of $918 in 2014 and ($2,024) in 2013   $ 1,705     $ (3,760 )
Total Comprehensive Income   $ 5,968     $ 757  
                 
       
    Nine Months Ended  
($ in thousands)   September 30, 2014     September 30, 2013  
Net income   $ 12,776     $ 13,168  
                 
Other Comprehensive Income, net of tax                
Unrealized holding gains (losses) on available for sale securities net of deferred tax of $4,264 in 2014 and ($7,142) in 2013     7,920       (13,263 )
Reclassification adjustment, net of income tax (benefit) of ($1) in 2014 and $18 in 2013     (3 )     32  
Other comprehensive income (loss), net of tax of $4,263 in 2014 and ($7,124) in 2013   $ 7,917     $ (13,231 )
Total Comprehensive Income (Loss)   $ 20,693     $ (63 )
                 
 
Key Ratios and Other Data
(Unaudited)
             
($ in thousands)   Three Months Ended     Nine Months Ended  
Average Balances   September 30, 2014     September 30, 2013     September 30, 2014     September 30, 2013  
Cash and due from banks   $ 11,863     $ 11,486     $ 11,811     $ 11,877  
Interest-bearing deposits     100,349       61,365       101,908       80,414  
Securities available for sale     202,113       199,709       193,549       198,866  
Securities held to maturity     162,531       165,881       163,268       165,014  
Restricted stock     1,089       1,414       1,187       1,498  
Mortgage loans held for sale     439       757       359       1,220  
Gross Loans     593,165       588,379       592,528       584,920  
Loans, net     584,308       579,404       583,521       575,741  
Intangible assets     7,646       8,722       7,914       8,989  
Total assets     1,121,501       1,078,837       1,115,643       1,090,628  
Total deposits     956,804       925,382       955,058       932,620  
Other borrowings     ---       ---       ---       ---  
Stockholders' equity     160,310       145,806       155,447       150,424  
Interest-earning assets     1,068,583       1,031,192       1,066,031       1,034,934  
Interest-bearing liabilities     808,075       784,421       810,808       791,940  
                                 
Financial ratios                                
Return on average assets     1.51 %     1.66 %     1.53 %     1.61 %
Return on average equity     10.55 %     12.29 %     10.99 %     11.70 %
Net interest margin     3.99 %     4.29 %     4.05 %     4.27 %
Net interest income-fully taxable equivalent   $ 10,755     $ 11,144     $ 32,253     $ 33,045  
Efficiency ratio     47.21 %     46.21 %     47.08 %     46.08 %
Average equity to average assets     14.29 %     13.52 %     13.93 %     13.79 %
                                 
Allowance for loan losses                                
Beginning balance   $ 7,971     $ 7,952     $ 8,227     $ 8,349  
Provision for losses     356       303       1,160       1,329  
Charge-offs     (324 )     (196 )     (1,568 )     (1,680 )
Recoveries     28       31       212       92  
Ending balance   $ 8,031     $ 8,090     $ 8,031     $ 8,090  
                                 
 
Asset Quality Data
(Unaudited)
             
($ in thousands)   September 30, 2014     September 30, 2013  
Nonperforming assets                
Nonaccrual loans   $ 5,366     $ 10,194  
Nonaccrual restructured loans     2,360       1,042  
Total nonperforming loans     7,726       11,236  
Other real estate owned     5,145       973  
Total nonperforming assets   $ 12,871     $ 12,209  
Accruing restructured loans     5,947       6,545  
Loans 90 days or more past due   $ 485     $ 149  
                 
Asset quality ratios                
Nonperforming assets to loans net of unearned income and deferred fees, plus other real estate owned     2.14 %     2.06 %
Allowance for loans losses to total loans     1.35 %     1.37 %
Allowance for loan losses to nonperforming loans     103.95 %     72.00 %
Loans past due 90 days or more to loans net of unearned income and deferred fees     0.08 %     0.03 %
                 
                 

Contact Information

  • CONTACTS:
    JAMES G. RAKES
    CHAIRMAN, PRESIDENT & CEO
    (540) 951-6236
    Email Contact

    DAVID K. SKEENS
    TREASURER & CFO
    (540) 951-6347
    Email Contact