National Bankshares, Inc. and Subsidiaries

Consolidated Balance Sheets

(Unaudited)

 

($ in thousands, except for share and per share data)

 

March 31, 2016

   

March 31, 2015

   

December 31, 2015

 

Assets

                       

Cash and due from banks

  $ 9,913     $ 12,452     $ 12,152  

Interest-bearing deposits

    129,363       87,676       130,811  

Federal funds sold

    ---       ---       ---  

Securities available for sale, at fair value

    270,094       238,496       236,131  

Securities held to maturity

    144,664       156,135       152,028  

Restricted stock

    1,170       1,129       1,129  

Total securities

    415,928       395,760       389,288  

Mortgage loans held for sale

    63       1,091       634  

Loans:

                       

Loans, net of unearned income and deferred fees

    607,643       622,171       619,008  

Less: allowance for loan losses

    (8,107 )     (8,257 )     (8,297 )

Loans, net

    599,536       613,914       610,711  

Premises and equipment, net

    8,841       8,998       9,020  

Accrued interest receivable

    5,587       5,506       5,769  

Other real estate owned

    3,612       4,573       4,165  

Intangible assets and goodwill

    6,114       6,954       6,224  

Bank-owned life insurance

    22,548       21,946       22,401  

Other assets

    6,366       5,975       8,564  

Total assets

  $ 1,207,871     $ 1,164,845     $ 1,199,739  
                         

Liabilities and Stockholders' Equity

                       

Noninterest-bearing deposits

  $ 170,207     $ 160,217     $ 166,453  

Interest-bearing demand deposits

    570,065       526,388       569,787  

Savings deposits

    92,944       85,615       90,236  

Time deposits

    185,296       212,737       192,383  

Total deposits

    1,018,512       984,957       1,018,859  

Other borrowed funds

    ---       ---       ---  

Accrued interest payable

    62       70       56  

Other liabilities

    10,061       7,096       8,710  

Total liabilities

    1,028,635       992,123       1,027,625  
                         

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, 6,957,974 shares at March 31, 2016 and December 31, 2015 and 6,950,474 shares at March 31, 2015.

    8,697       8,688       8,697  

Retained earnings

    175,132       167,253       171,353  

Accumulated other comprehensive loss, net

    (4,593 )     (3,219 )     (7,936 )

Total stockholders' equity

    179,236       172,722       172,114  

Total liabilities and stockholders' equity

  $ 1,207,871     $ 1,164,845     $ 1,199,739  

 

 

 

 

National Bankshares, Inc. and Subsidiaries

Consolidated Statements of Income

(Unaudited)

 

   

Three Months Ending

 

($ in thousands, except for share and per share data)

 

March 31, 2016

   

March 31, 2015

 

Interest Income

               

Interest and fees on loans

  $ 7,334     $ 7,610  

Interest on federal funds

    ---       ---  

Interest on interest-bearing deposits

    162       64  

Interest on securities - taxable

    1,677       1,734  

Interest on securities - nontaxable

    1,311       1,386  

Total interest income

    10,484       10,794  

Interest Expense

               

Interest on time deposits

    274       327  

Interest on other deposits

    794       760  

Interest on borrowed funds

    ---       ---  

Total interest expense

    1,068       1,087  

Net interest income

    9,416       9,707  

Provision for loan losses

    203       201  

Net income after provision for loan losses

    9,213       9,506  

Noninterest Income

               

Service charges on deposit accounts

    560       535  

Other service charges and fees

    72       71  

Credit card fees

    870       895  

Trust Income

    323       289  

Bank-owned life insurance

    147       149  

Other income

    345       314  

Realized securities gains (losses), net

    24       (2 )

Total noninterest income

    2,341       2,251  

Noninterest Expense

               

Salaries and employee benefits

    3,568       3,051  

Occupancy and furniture and fixtures

    477       449  

Data processing and ATM

    411       435  

FDIC assessment

    141       135  

Credit card processing

    622       610  

Intangibles and goodwill amortization

    110       269  

Net cost of other real estate owned

    69       464  

Franchise taxes

    331       308  

Other operating expenses

    955       959  

Total noninterest expense

    6,684       6,680  

Income before income tax expense

    4,870       5,077  

Income tax expense

    1,091       1,111  

Net Income

  $ 3,779     $ 3,966  

Basic net income per share

  $ 0.54     $ 0.57  

Fully diluted net income per share

  $ 0.54     $ 0.57  

Weighted average number of common shares outstanding

               

Basic

    6,957,974       6,950,474  

Diluted

    6,957,974       6,955,023  

Dividends declared per share

  $ ---     $ ---  

Dividend payout ratio

    0.00 %     0.00 %

Book value per share

  $ 25.76     $ 24.85  

 

 

 

 

National Bankshares, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income

(Unaudited)

 

   

Three Months Ended

 

($ in thousands)

 

March 31, 2016

   

March 31, 2015

 

Net Income

  $ 3,779     $ 3,966  
                 

Other Comprehensive Income, Net of Tax

               

Unrealized holding gains on available for sale securities net of tax of $1,809 and $1,320 for the periods ended March 31, 2016 and 2015, respectively

    3,359       2,452  

Reclassification adjustment for losses (gains) included in net income, net of tax of ($8) and $1 for the periods ended March 31, 2016 and 2015, respectively

    (16 )     1  

Other comprehensive income, net of tax of $1,801 and $1,321 for the periods ended March 31, 2016 and 2015, respectively

  $ 3,343     $ 2,453  

Total comprehensive income

  $ 7,122     $ 6,419  

 

 

 

 

Key Ratios and Other Data

(Unaudited)

 

   

Three Months Ended

 

$ in thousands

 

March 31, 2016

   

March 31, 2015

 

Average Balances

               

Cash and due from banks

  $ 11,309     $ 11,364  

Interest-bearing deposits

    125,849       104,104  

Securities available for sale

    245,153       222,161  

Securities held to maturity

    149,202       159,376  

Restricted stock

    1,133       1,095  

Mortgage loans held for sale

    427       460  

Gross Loans

    610,979       605,137  

Loans, net

    601,557       604,288  

Intangible assets

    6,170       7,109  

Total assets

    1,188,462       1,149,578  

Total deposits

    1,003,136       973,738  

Other borrowings

    ---       ---  

Stockholders' equity

    175,991       169,289  

Interest-earning assets

    1,132,925       1,092,481  

Interest-bearing liabilities

    838,943       821,308  
                 

Financial Ratios

               

Return on average assets

    1.28 %     1.40 %

Return on average equity

    8.64 %     9.50 %

Net interest margin

    3.66 %     3.94 %

Net interest income-fully taxable equivalent

  $ 10,307     $ 10,608  

Efficiency ratio

    52.85 %     51.95 %

Average equity to average assets

    14.81 %     14.73 %
                 

Allowance for Loan Losses

               

Beginning balance

  $ 8,297     $ 8,263  

Provision for losses

    203       201  

Charge-offs

    (453 )     (260 )

Recoveries

    60       53  

Ending balance

  $ 8,107     $ 8,257  

 

 

 

 

Asset Quality Data

(Unaudited)

 

$ in thousands

 

March 31, 2016

   

March 31, 2015

 

Nonperforming Assets

               

Nonaccrual loans

  $ 1,901     $ 3,102  

Nonaccrual restructured loans

    4,504       6,123  

Total nonperforming loans

    6,405       9,225  

Other real estate owned

  $ 3,612     $ 4,573  

Total nonperforming assets

  $ 10,017     $ 13,798  

Accruing restructured loans

    7,724       5,992  

Loans 90 days or more past due

  $ 328     $ 272  
                 

Asset Quality Ratios

               

Nonperforming assets to loans net of unearned income and deferred fees, plus other real estate owned

    1.64 %     2.20 %

Allowance for loans losses to total loans

    1.33 %     1.33 %

Allowance for loan losses to nonperforming loans

    126.57 %     89.51 %

Loans past due 90 days or more to loans net of unearned income and deferred fees

    0.05 %     0.04 %