SOURCE: National Bankshares, Inc.

National Bankshares, Inc.

October 29, 2015 16:30 ET

National Bankshares, Inc. Reports Income for the Nine Months Ended September 30, 2015

BLACKSBURG, VA--(Marketwired - Oct 29, 2015) - Today, National Bankshares, Inc. (NASDAQ: NKSH) announced net income of approximately $12.28 million through September 30, 2015 compared to $12.78 million reported for the first nine months of 2014. Basic earnings per share were $1.77 which compares with $1.84 reported at September 30, 2014. The return on average assets for the nine months ended September 30, 2015 was 1.43% compared to 1.53% in 2014. The return on average equity was 9.60% and 10.99% for the same two periods. At September 30, 2015, the Company had total assets of over $1.14 billion.

National Bankshares' Chairman, President & CEO James G. Rakes commented, "As our regional economy continues its steady recovery, we are seeing increasing demand for loans in our market area. We continue to emphasize quality over quantity in our lending approach and believe we are building a loan portfolio that will perform well in the future. While our earnings remain strong, we look to the future and continue our investment in our systems, products, processes and people."

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 26 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, 2015     September 30, 2014     December 31, 2014  
Assets                        
Cash and due from banks   $ 12,446     $ 12,815     $ 12,894  
Interest-bearing deposits     90,295       87,621       102,548  
Federal funds sold     ---       ---       ---  
Securities available for sale, at fair value     211,232       205,020       222,844  
Securities held to maturity     154,644       162,457       161,452  
Restricted stock     1,129       1,089       1,089  
    Total securities     367,005       368,566       385,385  
Mortgage loans held for sale     1,331       725       291  
Loans:                        
  Loans, net of unearned income and deferred fees     625,755       595,801       605,466  
  Less: allowance for loan losses     (8,117 )     (8,031 )     (8,263 )
    Loans, net     617,638       587,770       597,203  
Premises and equipment, net     9,135       9,445       9,131  
Accrued interest receivable     5,659       5,708       5,748  
Other real estate owned     4,194       5,145       4,744  
Intangible assets and goodwill     6,416       7,492       7,223  
Bank-owned life insurance     22,248       21,643       21,797  
Other assets     7,758       9,329       7,767  
    Total assets   $ 1,144,125     $ 1,116,259     $ 1,154,731  
                         
Liabilities and Stockholders' Equity                        
Noninterest-bearing deposits   $ 163,877     $ 153,118     $ 150,744  
Interest-bearing demand deposits     514,823       492,005       533,641  
Savings deposits     86,659       79,870       81,297  
Time deposits     197,171       223,930       216,746  
    Total deposits     962,530       948,923       982,428  
Other borrowed funds     ---       ---       ---  
Accrued interest payable     61       67       68  
Other liabilities     7,142       4,447       5,932  
    Total liabilities     969,733       953,437       988,428  
                         
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, 6,955,974 shares at September 30, 2015, and 6,950,474 shares at December 31, 2014 and at September 30, 2014, respectively.     8,695       8,688       8,688  
Retained earnings     171,996       163,181       163,287  
Accumulated other comprehensive loss, net     (6,299 )     (9,047 )     (5,672 )
    Total stockholders' equity     174,392       162,822       166,303  
    Total liabilities and stockholders' equity   $ 1,144,125     $ 1,116,259     $ 1,154,731  
                         
                         
   
National Bankshares, Inc. and Subsidiaries  
Consolidated Statements of Income  
(Unaudited)  
   
    Three Months Ended   Nine Months Ended  
    September 30, 2015   September 30, 2014   September 30, 2015     September 30, 2014  
$ in thousands, except for share and per share data                            
Interest Income                            
Interest and fees on loans   $ 7,676   $ 7,729   $ 22,886     $ 23,406  
Interest on federal funds     ---     ---     ---       ---  
Interest on interest-bearing deposits     54     64     173       193  
Interest on securities - taxable     1,678     1,718     5,124       5,068  
Interest on securities - nontaxable     1,352     1,436     4,095       4,410  
  Total interest income     10,760     10,947     32,278       33,077  
Interest Expense                            
Interest on time deposits     301     361     943       1,133  
Interest on other deposits     708     786     2,204       2,624  
Interest on borrowed funds     ---     ---     ---       ---  
  Total interest expense     1,009     1,147     3,147       3,757  
  Net interest income     9,751     9,800     29,131       29,320  
Provision for loan losses     178     356     734       1,160  
  Net income after provision for loan losses     9,573     9,444     28,397       28,160  
Noninterest Income                            
Service charges on deposit accounts     571     634     1,676       1,833  
Other service charges and fees     45     42     164       145  
Credit card fees     972     929     2,843       2,687  
Trust Income     314     296     902       921  
Bank-owned life insurance     151     153     451       462  
Other income     234     200     977       783  
Realized securities gains, net     2     4     5       5  
  Total noninterest income     2,289     2,258     7,018       6,836  
Noninterest Expense                            
Salaries and employee benefits     3,149     2,927     9,433       8,890  
Occupancy and furniture and fixtures     436     403     1,296       1,250  
Data processing and ATM     384     429     1,230       1,189  
FDIC assessment     138     147     408       411  
Credit card processing     701     673     1,986       1,887  
Intangibles and goodwill amortization     269     269     807       807  
Net cost of other real estate owned     52     98     569       259  
Franchise taxes     329     307     959       874  
Other operating expenses     864     862     2,690       2,747  
  Total noninterest expense     6,322     6,115     19,378       18,314  
Income before income tax expense     5,540     5,587     16,037       16,682  
Income tax expense     1,341     1,324     3,762       3,906  
  Net income   $ 4,199   $ 4,263   $ 12,275     $ 12,776  
Basic net income per share   $ 0.60   $ 0.61   $ 1.77     $ 1.84  
Fully diluted net income per share   $ 0.60   $ 0.61   $ 1.76     $ 1.84  
Weighted average number of common shares outstanding                            
  Basic     6,955,126     6,948,681     6,952,716       6,948,212  
  Diluted     6,959,168     6,956,777     6,956,689       6,960,444  
Dividends declared per share     ---     ---   $ 0.53     $ 0.55  
Dividend payout ratio     ---     ---     30.03 %     29.91 %
Book value per share     ---     ---   $ 25.07     $ 23.43  
                             
                             
   
National Bankshares, Inc. and Subsidiaries  
Consolidated Statements of Comprehensive Income  
(Unaudited)  
   
    Three Months Ended  
$ in thousands   September 30, 2015     September 30, 2014  
Net income   $ 4,199     $ 4,263  
                 
Other Comprehensive Income, net of tax                
Unrealized holding gains on available for sale securities net of tax of $1,396 in 2015 and $919 in 2014     2,587       1,708  
Reclassification adjustment for gains included in net income, net of tax of ($1) in 2015 and ($1) in 2014     (1 )     (3 )
Other comprehensive income, net of tax of $1,395 in 2015 and $918 in 2014   $ 2,586     $ 1,705  
Total Comprehensive Income   $ 6,785     $ 5,968  
                 
                 
       
    Nine Months Ended  
$ in thousands   September 30, 2015     September 30, 2014  
Net income   $ 12,275     $ 12,776  
                 
Other Comprehensive Income, net of tax                
Unrealized holding gains (losses) on available for sale securities net of tax of ($334) in 2015 and $4,264 in 2014     (624 )     7,920  
Reclassification adjustment for gains included in net income, net of tax of ($2) in 2015 and ($1) in 2014     (3 )     (3 )
Other comprehensive income (loss), net of tax of ($336) in 2015 and $4,263 in 2014   $ (627 )   $ 7,917  
Total Comprehensive Income   $ 11,648     $ 20,693  
                 
                 
   
National Bankshares, Inc. and Subsidiaries  
Key Ratios and Other Data  
(Unaudited)  
   
$ in thousands   Three Months Ended     Nine Months Ended  
Average Balances   September 30, 2015     September 30, 2014     September 30, 2015     September 30, 2014  
Cash and due from banks   $ 11,612     $ 11,863     $ 11,506     $ 11,811  
Interest-bearing deposits     84,882       100,349       91,791       101,908  
Securities available for sale     216,949       202,113       222,823       193,549  
Securities held to maturity     154,978       162,531       156,678       163,268  
Restricted stock     1,129       1,089       1,118       1,187  
Mortgage loans held for sale     986       439       781       359  
Gross Loans     627,596       593,165       619,204       592,528  
Loans, net     618,611       584,308       610,135       583,521  
Intangible assets     6,571       7,646       6,838       7,914  
Total assets     1,144,723       1,121,501       1,150,026       1,115,643  
Total deposits     966,199       956,804       972,104       955,058  
Other borrowings     ---       ---       ---       ---  
Stockholders' equity     171,698       160,310       170,883       155,447  
Interest-earning assets     1,089,803       1,068,583       1,093,699       1,066,031  
Interest-bearing liabilities     805,655       808,075       814,800       810,808  
                                 
Financial ratios                                
Return on average assets     1.46 %     1.51 %     1.43 %     1.53 %
Return on average equity     9.70 %     10.55 %     9.60 %     10.99 %
Net interest margin     3.89 %     3.98 %     3.90 %     4.03 %
Net interest income-fully taxable equivalent   $ 10,673     $ 10,719     $ 31,881     $ 32,139  
Efficiency ratio     48.77 %     47.12 %     49.82 %     46.99 %
Average equity to average assets     15.00 %     14.29 %     14.86 %     13.93 %
                                 
Allowance for loan losses                                
Beginning balance   $ 8,131     $ 7,971     $ 8,263     $ 8,227  
Provision for losses     178       356       734       1,160  
Charge-offs     (226 )     (324 )     (1,002 )     (1,568 )
Recoveries     34       28       122       212  
Ending balance   $ 8,117     $ 8,031     $ 8,117     $ 8,031  
                                 
                                 
   
National Bankshares, Inc. and Subsidiaries  
Asset Quality Data  
(Unaudited)  
   
$ in thousands   September 30, 2015     September 30, 2014  
Nonperforming assets                
Nonaccrual loans   $ 3,207     $ 5,366  
Nonaccrual restructured loans     5,781       2,360  
Total nonperforming loans     8,988       7,726  
Other real estate owned     4,194       5,145  
Total nonperforming assets   $ 13,182     $ 12,871  
Accruing restructured loans     6,080       5,947  
Loans 90 days or more past due   $ 47     $ 485  
                 
Asset quality ratios                
Nonperforming assets to loans net of unearned income and deferred fees, plus other real estate owned     2.09 %     2.14 %
Allowance for loans losses to total loans     1.30 %     1.35 %
Allowance for loan losses to nonperforming loans     90.31 %     103.95 %
Loans past due 90 days or more to loans net of unearned income and deferred fees     0.01 %     0.08 %
                 

Contact Information

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

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