Source: National Bankshares, Inc.
National Bankshares, Inc. Reports Higher First Quarter Income
BLACKSBURG, VA--(Marketwire - Apr 14, 2011) - Today, National Bankshares, Inc. (NASDAQ: NKSH) announced net income of over $4.02 million for the quarter ended March 31, 2011. Net income is $255,000, or nearly 6.77%, above the total reported for the first quarter of 2010. Basic net income per share was $0.58, which compares with $0.54 for the first three months last year. The return of average assets for the first quarter was 1.60%, and it was 1.57% for the three months ended March 31, 2010. The return on average equity was 12.44% and 12.27% for the same two periods. Total loans at quarter-end, at $588.88 million, were down slightly from the total of $589.13 million at the end of March last year, but were up from $577.39 million reported at December 31, 2010. At March 31, 2011, the Company had total assets of $1.03 billion, an increase of 3.40% over the end of the first quarter of 2010 and up slightly from total assets of $1.02 billion at year-end.
National Bankshares' Chairman, President & CEO James G. Rakes commented, "The stable interest rate environment during the first quarter of the year allowed us to maintain a healthy net interest margin, which resulted in an increase in net interest income. We have seen some tentative signs that the economic recovery may be reaching our market area, but loan demand remains slower than we would like and some customers continue to struggle. Our lenders have been working with these customers to try to help them through their difficulties. We are still prudently funding the provision for loan losses as we look forward to indications of a sustained recovery."
National Bankshares, Inc., headquartered in Blacksburg, Virginia, is the parent company of 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 Sheet
(Unaudited)
($ in thousands, except for per March 31, March 31, December 31,
share data) 2011 2010 2010
----------- ----------- -----------
Assets
Cash and due from banks $ 11,800 $ 11,744 $ 9,858
Interest-bearing deposits 55,674 55,706 69,400
Federal funds sold --- --- ---
Securities available for sale 190,844 161,543 184,907
Securities held to maturity 132,669 125,547 131,000
----------- ----------- -----------
Total securities 323,513 287,090 315,907
----------- ----------- -----------
Mortgage loans held for sale --- 1,358 2,460
Loans:
Real estate construction loans 48,671 47,245 46,169
Real estate mortgage loans 173,785 165,604 173,533
Commercial and industrial loans 280,607 284,242 269,818
Consumer loans 85,816 92,035 87,868
----------- ----------- -----------
Total loans 588,879 589,126 577,388
Less: unearned income and
deferred fees (977) (1,052) (945)
----------- ----------- -----------
Loans, net of unearned income
and deferred fees 587,902 588,074 576,443
Less: allowance for loan losses (8,245) (7,141) (7,664)
----------- ----------- -----------
Loans, net 579,657 580,933 568,779
----------- ----------- -----------
Bank premises and equipment, net 10,366 10,729 10,470
Accrued interest receivable 6,514 6,186 6,016
Other real estate owned 2,222 2,567 1,723
Intangible assets 11,272 12,355 11,543
Other assets 25,645 24,276 26,082
----------- ----------- -----------
Total assets $ 1,026,663 $ 992,944 $ 1,022,238
=========== =========== ===========
Liabilities and Stockholders' Equity
Noninterest-bearing deposits $ 136,769 $ 116,153 $ 131,540
Interest-bearing demand deposits 372,470 325,214 365,040
Savings deposits 58,273 53,977 55,800
Time deposits 318,383 362,124 332,203
----------- ----------- -----------
Total deposits 885,895 857,468 884,583
----------- ----------- -----------
Other borrowed funds --- --- ---
Accrued interest payable 260 392 257
Other liabilities 6,843 8,580 8,211
----------- ----------- -----------
Total liabilities 892,998 866,440 893,051
----------- ----------- -----------
Stockholders' Equity
Preferred stock of no par value.
Authorized 5,000,000 shares; none
issued and outstanding --- --- ---
Common stock of $1.25 par value.
Authorized 10,000,000 shares;issued
and outstanding 6,935,974 shares at
March 31, 2011 and 6,933,474 at
December 31, 2010 8,670 8,667 8,667
Retained earnings 127,218 117,670 123,161
Accumulated other comprehensive
income (loss), net (2,223) 167 (2,641)
----------- ----------- -----------
Total stockholders' equity 133,665 126,504 129,187
----------- ----------- -----------
Total liabilities and
stockholders' equity $ 1,026,663 $ 992,944 $ 1,022,238
=========== =========== ===========
National Bankshares, Inc. and Subsidiaries
Consolidated Statements of Income
(Unaudited)
Three Months Ended
March 31, March 31,
($ in thousands, except for per share data) 2011 2010
------------ -----------
Interest Income
Interest and fees on loans $ 9,095 $ 9,176
Interest on federal funds --- ---
Interest on interest-bearing deposits 32 19
Interest on securities- taxable 1,662 1,443
Interest on securities- nontaxable 1,676 1,602
------------ -----------
Total interest income 12,465 12,240
------------ -----------
Interest Expense
Interest on time deposits of $100,000 or more 561 946
Interest on other deposits 1,818 2,033
Interest on borrowed funds --- ---
------------ -----------
Total interest expense 2,379 2,979
------------ -----------
Net interest income 10,086 9,261
Provision for loan losses 800 647
------------ -----------
Net interest income after provision for loan
losses 9,286 8,614
------------ -----------
Noninterest Income
Service charges on deposit accounts 612 714
Other service charges and fees 58 47
Credit card fees 733 666
Trust income 246 269
Bank-owned life insurance 184 185
Other income 91 104
Realized securities gains (losses), net 10 (14)
------------ -----------
Total noninterest income 1,934 1,971
------------ -----------
Noninterest Expense
Salaries and employee benefits 2,904 2,856
Occupancy and furniture and fixtures 423 491
Data processing and ATM 444 357
FDIC assessment 346 263
Credit card processing 586 508
Intangibles and goodwill amortization 271 271
Net costs of other real estate owned 134 33
Franchise taxes 242 239
Other operating expenses 734 766
------------ -----------
Total noninterest expense 6,084 5,784
------------ -----------
Income before income tax expense 5,136 4,801
Income tax expense 1,112 1,032
------------ -----------
Net income $ 4,024 $ 3,769
============ ===========
Basic net income per share $ 0.58 $ 0.54
============ ===========
Fully diluted net income per share $ 0.58 $ 0.54
============ ===========
Weighted average outstanding number of common
shares
Basic 6,933,780 6,933,474
============ ===========
Diluted 6,957,450 6,952,812
============ ===========
Dividends declared per share --- ---
============ ===========
Dividend payout ratio --- ---
============ ===========
Book value per share $ 19.27 $ 18.25
============ ===========
Key Ratios and Other Data
(Unaudited)
Three Months Ended
March 31, March 31,
Average Balances 2011 2010
--------- ---------
Cash and due from banks $ 11,420 $ 11,197
Interest-bearing deposits 54,089 34,866
Securities available for sale 187,510 163,438
Securities held to maturity 132,322 125,448
Mortgage loans held for sale 696 619
Gross loans 585,444 589,379
Loans, net 576,614 581,296
Intangible assets 11,428 12,511
Total assets 1,016,979 971,844
Total deposits 877,294 838,697
Other borrowings --- ---
Stockholders' equity 131,191 124,529
Interest-earning assets 959,550 909,654
Interest-bearing liabilities 747,612 723,107
Financial ratios
Return on average assets 1.60% 1.57%
Return on average equity 12.44% 12.27%
Net interest margin 4.68% 4.57%
Net interest income - fully taxable equivalent $ 11,066 $ 10,142
Efficiency ratio 46.84% 47.70%
Average equity to average assets 12.90% 12.81%
Allowance for loan losses
Beginning balance $ 7,664 $ 6,926
Provision for losses 800 647
Charge-offs (243) (456)
Recoveries 24 24
--------- ---------
Ending balance $ 8,245 $ 7,141
========= =========
Asset Quality Data
(Unaudited)
March 31, March 31,
Nonperforming assets 2011 2010
-------- --------
Nonaccrual loans $ 2,339 $ 7,743
Restructured loans 6,198 ---
-------- --------
Total nonperforming loans 8,537 7,743
Other real estate owned 2,222 2,567
-------- --------
Total nonperforming assets $ 10,759 $ 10,310
======== ========
Loans 90 days or more past due $ 1,078 $ 2,217
======== ========
Asset quality ratios
Nonperforming assets to loans net of unearned income
and deferred fees, plus other real estate owned 1.82% 1.75%
Allowance for loan losses to total loans 1.40% 1.21%
Allowance for loan losses to nonperforming loans 96.58% 92.23%
Loans past due 90 days or more to loans net of unearned
income and deferred fees 0.18% 0.38%
Contact Information: CONTACTS: JAMES G. RAKES CHAIRMAN, PRESIDENT & CEO (540) 951-6236 DAVID K. SKEENS TREASURER & CFO (540) 951-6347