SOURCE: National Bankshares, Inc.

National Bankshares, Inc.

July 23, 2015 16:30 ET

National Bankshares, Inc. Reports Second Quarter and First Half Earnings

BLACKSBURG, VA--(Marketwired - Jul 23, 2015) - National Bankshares, Inc. (NASDAQ: NKSH) today announced its results of operations for the second quarter and first half of 2015. The Company reported net income of almost $8.08 million for the six months ended June 30, 2015 compared to $8.51 million at June 30, 2014. Basic earnings per share were $1.16 at June 30, 2015 compared to $1.23 for the same period in 2014. For the first half of the year, the return on average assets was 1.41% and the return on average equity was 9.55% compared to 1.54% and 11.22%, respectively, for the first six months of 2014. At June 30, 2015, the Company had total assets of almost $1.15 billion which was an increase of 1.75% when compared to $1.13 billion at the end of June 2014.

Commenting on the Company's financial results, National Bankshares Chairman, President & CEO James G. Rakes said, "Loan growth of over $33.54 million, or 5.65%, from June 30, 2014 is a positive indicator of a stronger demand for credit. We continue to focus on meeting the financial needs of our customers and our employees are dedicated to striving to meet those needs."

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)   June 30, 2015     June 30, 2014     December 31, 2014  
Assets                        
Cash and due from banks   $ 11,353     $ 15,917     $ 12,894  
Interest-bearing deposits     83,818       106,112       102,548  
Federal funds sold     ---       ---       ---  
Securities available for sale, at fair value     218,524       195,407       222,844  
Securities held to maturity     155,704       162,956       161,452  
Restricted stock     1,129       1,089       1,089  
    Total securities     375,357       359,452       385,385  
Mortgage loans held for sale     853       383       291  
Loans:                        
  Loans, net of unearned income and deferred fees     626,941       593,400       605,466  
  Less: allowance for loan losses     (8,131 )     (7,971 )     (8,263 )
    Loans, net     618,810       585,429       597,203  
Premises and equipment, net     8,878       9,482       9,131  
Accrued interest receivable     5,857       5,798       5,748  
Other real estate owned     4,441       5,293       4,744  
Intangible assets and goodwill     6,685       7,761       7,223  
Bank-owned life insurance     22,097       21,491       21,797  
Other assets     10,122       11,361       7,767  
    Total assets   $ 1,148,271     $ 1,128,479     $ 1,154,731  
                         
Liabilities and Stockholders' Equity                        
Noninterest-bearing deposits   $ 157,983     $ 146,727     $ 150,744  
Interest-bearing demand deposits     526,749       510,304       533,641  
Savings deposits     86,354       79,255       81,297  
Time deposits     203,070       231,177       216,746  
    Total deposits     974,156       967,463       982,428  
Other borrowed funds     ---       ---       ---  
Accrued interest payable     61       71       68  
Other liabilities     6,484       4,149       5,932  
    Total liabilities     980,701       971,683       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, 6,954,474 shares at June 30, 2015, 6,950,474 at December 31, 2014 and 6,947,974 shares at June 30, 2014.     8,693       8,685       8,688  
Retained earnings     167,764       158,863       163,287  
Accumulated other comprehensive loss, net     (8,887 )     (10,752 )     (5,672 )
    Total stockholders' equity     167,570       156,796       166,303  
    Total liabilities and stockholders' equity   $ 1,148,271     $ 1,128,479     $ 1,154,731  
                             
                             
 
National Bankshares, Inc. and Subsidiaries
Consolidated Statements of Income
(Unaudited)
 
    Three Months Ended   Six Months Ended  
($ in thousands, except for share and per share data)   June 30, 2015   June 30, 2014   June 30, 2015     June 30, 2014  
Interest Income                            
Interest and fees on loans   $ 7,673   $ 7,819   $ 15,322     $ 15,754  
Interest on federal funds     ---     ---     ---       ---  
Interest on interest-bearing deposits     55     64     119       129  
Interest on securities - taxable     1,712     1,697     3,446       3,350  
Interest on securities - nontaxable     1,357     1,474     2,743       2,974  
  Total interest income     10,797     11,054     21,630       22,207  
Interest Expense                            
Interest on time deposits of $100 or more     120     145     248       298  
Interest on other deposits     931     1,150     1,890       2,312  
Interest on borrowed funds     ---     ---     ---       ---  
  Total interest expense     1,051     1,295     2,138       2,610  
  Net interest income     9,746     9,759     19,492       19,597  
Provision for loan losses     355     701     556       804  
  Net income after provision for loan losses     9,391     9,058     18,936       18,793  
Noninterest Income                            
Service charges on deposit accounts     570     607     1,105       1,199  
Other service charges and fees     48     38     119       103  
Credit card fees     976     961     1,871       1,758  
Trust Income     299     332     588       625  
Bank-owned life insurance     172     177     342       352  
Other income     349     229     631       506  
Realized securities gains, net     5     ---     3       1  
  Total noninterest income     2,419     2,344     4,659       4,544  
Noninterest Expense                            
Salaries and employee benefits     3,254     3,007     6,326       6,006  
Occupancy and furniture and fixtures     417     417     869       857  
Data processing and ATM     409     394     843       757  
FDIC assessment     135     117     270       264  
Credit card processing     675     665     1,285       1,214  
Intangibles and goodwill amortization     269     269     538       538  
Net cost of other real estate owned     46     84     517       161  
Franchise taxes     322     287     630       566  
Other operating expenses     863     820     1,820       1,879  
  Total noninterest expense     6,390     6,060     13,098       12,242  
Income before income tax expense     5,420     5,342     10,497       11,095  
Income tax expense     1,310     1,233     2,421       2,582  
  Net income   $ 4,110   $ 4,109   $ 8,076     $ 8,513  
Basic net income per share   $ 0.59   $ 0.59   $ 1.16     $ 1.23  
Fully diluted net income per share   $ 0.59   $ 0.59   $ 1.16     $ 1.22  
Weighted average number of common shares outstanding                            
  Basic     6,952,540     6,947,974     6,951,513       6,947,974  
  Diluted     6,956,039     6,960,683     6,955,093       6,962,274  
Dividends declared per share   $ 0.53   $ 0.55   $ 0.53     $ 0.55  
Dividend payout ratio     ---     ---     45.64 %     44.89 %
Book value per share   $ 24.85   $ 22.57   $ 24.10     $ 22.57  
                             
                             
 
National Bankshares, Inc. and Subsidiaries
Consolidated Statements of Comprehensive Income
(Unaudited)
 
    Three Months Ended
($ in thousands, except for share and per share data)   June 30, 2015     June 30, 2014
Net income   $ 4,110     $ 4,109
               
Other Comprehensive Income (Loss), net of tax              
Unrealized holding gains (losses) on available for sale securities net of deferred tax of ($3,048) in 2015 and $1,664 in 2014     (5,665 )     3,091
Reclassification adjustment, net of income tax (benefit) of ($2) in 2015 and $0 in 2014     (3 )     ---
Other comprehensive income (loss), net of tax of ($3,050) in 2015 and $1,664 in 2014   $ (5,668 )   $ 3,091
Total Comprehensive Income (Loss)   $ (1,558 )   $ 7,200
               
               
     
    Six Months Ended
($ in thousands)   June 30, 2015     June 30, 2014
Net income   $ 8,076     $ 8,513
               
Other Comprehensive Income, net of tax              
Unrealized holding gains (losses) on available for sale securities net of deferred tax of ($1,728) in 2015 and $3,345 in 2014     (3,213 )     6,212
Reclassification adjustment, net of income tax (benefit) of ($1) in 2015 and $0 in 2014     (2 )     ---
Other comprehensive income (loss), net of tax of ($1,729) in 2015 and $3,345 in 2014   $ (3,215 )   $ 6,212
Total Comprehensive Income   $ 4,861     $ 14,725
               
               
 
National Bankshares, Inc. and Subsidiaries
Key Ratios and Other Data
(Unaudited)
 
($ in thousands)   Three Months Ended     Six Months Ended  
    June 30, 2015     June 30, 2014     June 30, 2015     June 30, 2014  
Average Balances                                
Cash and due from banks   $ 11,537     $ 11,636     $ 11,451     $ 11,786  
Interest-bearing deposits     86,617       102,409       95,314       102,698  
Securities available for sale     229,447       193,854       225,824       189,196  
Securities held to maturity     155,736       164,476       157,547       163,643  
Restricted stock     1,130       1,089       1,112       1,237  
Mortgage loans held for sale     893       256       678       319  
Gross Loans     624,598       592,073       614,922       592,205  
Loans, net     623,764       583,054       605,809       583,121  
Intangible assets     6,839       7,915       6,974       8,050  
Total assets     1,154,036       1,116,461       1,152,733       1,112,664  
Total deposits     976,427       954,592       975,118       954,163  
Other borrowings     1       1       ---       ---  
Stockholders' equity     171,616       156,045       170,461       152,975  
Interest-earning assets     1,098,870       1,067,136       1,095,696       1,064,732  
Interest-bearing liabilities     817,675       811,711       819,481       812,197  
                                 
Financial ratios                                
Return on average assets     1.43 %     1.48 %     1.41 %     1.54 %
Return on average equity     9.61 %     10.56 %     9.55 %     11.22 %
Net interest margin     3.90 %     4.02 %     3.92 %     4.07 %
Net interest income-fully taxable equivalent   $ 10,672     $ 10,699     $ 21,320     $ 21,498  
Efficiency ratio     48.81 %     46.46 %     50.42 %     47.01 %
Average equity to average assets     14.87 %     13.98 %     14.79 %     13.75 %
                                 
Allowance for loan losses                                
Beginning balance   $ 8,257     $ 8,297     $ 8,263     $ 8,227  
Provision for losses     355       701       556       804  
Charge-offs     (516 )     (1,053 )     (776 )     (1,244 )
Recoveries     35       26       88       184  
Ending balance   $ 8,131     $ 7,971     $ 8,131     $ 7,971  
                                 
                                 
 
National Bankshares, Inc. and Subsidiaries
Asset Quality Data
(Unaudited)
 
$ in thousands            
Nonperforming assets   June 30, 2015     June 30, 2014  
Nonaccrual loans   $ 2,870     $ 2,335  
Nonaccrual restructured loans     6,035       2,674  
Total nonperforming loans   $ 8,905     $ 5,009  
Other real estate owned     4,441       5,293  
Total nonperforming assets   $ 13,346     $ 10,302  
Accruing restructured loans   $ 5,943     $ 6,240  
Loans 90 days or more past due   $ 80     $ 266  
                 
Asset quality ratios                
Nonperforming assets to loans net of unearned income and deferred fees, plus other real estate owned     2.11 %     1.72 %
Allowance for loans losses to total loans     1.30 %     1.34 %
Allowance for loan losses to nonperforming loans     91.31 %     159.13 %
Loans past due 90 days or more to loans net of unearned income and deferred fees     0.01 %     0.04 %
                 

Contact Information

  • CONTACTS:
    James G. Rakes
    Chairman, President & CEO
    (540) 951-6236
    Email Contact

    David K. Skeens
    Treasurer & CFO
    (540) 951-6347
    Email Contact