National Bankshares, Inc. Reports First Quarter Earnings
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BLACKSBURG, VA -- (Marketwired) -- 04/23/15 -- National Bankshares, Inc. (NASDAQ: NKSH) today announced its results of operations for the first quarter of 2015. The Company reported net income of almost $3.97 million for the quarter ended March 31, 2015 compared to $4.40 million at March 31, 2014. Basic earnings per share were $0.57 at March 31, 2015 compared to $0.63 for the same period in 2014. For the first quarter, the return on average assets was 1.40% and the return on average equity was 9.50% compared to 1.61% and 11.92%, respectively, for the first quarter of 2014. At March 31, 2015, the Company had total assets of $1.16 billion which was an increase of 3.72% when compared to $1.12 billion at the end of the first quarter of 2014.
Commenting on the Company's financial results, National Bankshares Chairman, President & CEO James G. Rakes said, "We experienced write downs of $394 thousand on other real estate owned during the first quarter that contributed to the lower net income. Among other expenses, we had increased employee benefit expenses, mostly the result of pension related costs. Our loans, however, showed positive growth of over $33 million, or 5.71%, compared to first quarter of 2014. We still face challenges, such as the low interest rate environment which affect our margins, but we continue to be optimistic and focused on opportunities to grow our business and deliver the promise of successful community banking to our customers, employees, and stockholders."
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 March 31, March 31, December 31,
per share data) 2015 2014 2014
---------- ---------- -------------
Assets
Cash and due from banks $ 12,452 $ 14,723 $ 12,894
Interest-bearing deposits 87,676 109,181 102,548
Federal funds sold --- --- ---
Securities available for sale, at
fair value 238,496 190,061 222,844
Securities held to maturity 156,135 165,398 161,452
Restricted stock 1,129 1,089 1,089
---------- ---------- -------------
Total securities 395,760 356,548 385,385
---------- ---------- -------------
Mortgage loans held for sale 1,091 --- 291
Loans:
Loans, net of unearned income and
deferred fees 622,171 589,048 605,466
Less: allowance for loan losses (8,257) (8,297) (8,263)
---------- ---------- -------------
Loans, net 613,914 580,751 597,203
---------- ---------- -------------
Premises and equipment, net 8,998 9,428 9,131
Accrued interest receivable 5,506 5,893 5,748
Other real estate owned 4,573 4,901 4,744
Intangible assets and goodwill 6,954 8,029 7,223
Bank-owned life insurance 21,946 21,335 21,797
Other assets 5,975 12,321 7,767
---------- ---------- -------------
Total assets $1,164,845 $1,123,110 $ 1,154,731
========== ========== =============
Liabilities and Stockholders' Equity
Noninterest-bearing deposits $ 160,217 $ 145,963 $ 150,744
Interest-bearing demand deposits 526,388 503,596 533,641
Savings deposits 85,615 77,467 81,297
Time deposits 212,737 237,060 216,746
---------- ---------- -------------
Total deposits 984,957 964,086 982,428
---------- ---------- -------------
Other borrowed funds --- --- ---
Accrued interest payable 70 78 68
Other liabilities 7,096 5,529 5,932
---------- ---------- -------------
Total liabilities 992,123 969,693 988,428
---------- ---------- -------------
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, 6,950,474 shares at
March 31, 2015 and December 31, 2014
and 6,947,974 shares at March 31,
2014. 8,688 8,685 8,688
Retained earnings 167,253 158,575 163,287
Accumulated other comprehensive loss,
net (3,219) (13,843) (5,672)
---------- ---------- -------------
Total stockholders' equity 172,722 153,417 166,303
---------- ---------- -------------
Total liabilities and stockholders'
equity $1,164,845 $1,123,110 $ 1,154,731
========== ========== =============
National Bankshares, Inc. and Subsidiaries
Consolidated Statements of Income
(Unaudited)
Three Months Ending
March 31, March 31,
($ in thousands, except for share and per share data) 2015 2014
---------- ----------
Interest Income
Interest and fees on loans $ 7,649 $ 7,935
Interest on federal funds --- ---
Interest on interest-bearing deposits 64 65
Interest on securities - taxable 1,734 1,653
Interest on securities - nontaxable 1,386 1,500
---------- ----------
Total interest income 10,833 11,153
---------- ----------
Interest Expense
Interest on time deposits of $100 or more 128 153
Interest on other deposits 959 1,162
Interest on borrowed funds --- ---
---------- ----------
Total interest expense 1,087 1,315
---------- ----------
Net interest income 9,746 9,838
Provision for loan losses 201 103
---------- ----------
Net income after provision for loan losses 9,545 9,735
---------- ----------
Noninterest Income
Service charges on deposit accounts 535 592
Other service charges and fees 71 65
Credit card fees 895 797
Trust Income 289 293
Bank-owned life insurance 170 175
Other income 282 277
Realized securities gains (losses), net (2) 1
---------- ----------
Total noninterest income 2,240 2,200
---------- ----------
Noninterest Expense
Salaries and employee benefits 3,072 2,999
Occupancy and furniture and fixtures 452 440
Data processing and ATM 434 363
FDIC assessment 135 147
Credit card processing 610 549
Intangibles and goodwill amortization 269 269
Net cost of other real estate owned 471 77
Franchise taxes 308 279
Other operating expenses 957 1,059
---------- ----------
Total noninterest expense 6,708 6,182
---------- ----------
Income before income tax expense 5,077 5,753
Income tax expense 1,111 1,349
---------- ----------
Net income $ 3,966 $ 4,404
========== ==========
Basic net income per share $ 0.57 $ 0.63
========== ==========
Fully diluted net income per share $ 0.57 $ 0.63
========== ==========
Weighted average number of common shares outstanding
Basic 6,950,474 6,947,974
========== ==========
Diluted 6,955,023 6,963,865
========== ==========
Dividends declared per share $ --- $ ---
========== ==========
Dividend payout ratio --- ---
========== ==========
Book value per share $ 24.85 $ 22.08
========== ==========
National Bankshares, Inc. and Subsidiaries
Consolidated Statements of Comprehensive Income
(Unaudited)
Three Months Ended
March 31, March 31,
($ in thousands) 2015 2014
---------- ----------
Net income $ 3,966 $ 4,404
Other Comprehensive Income, net of tax
Unrealized holding gains on available for sale
securities net of deferred tax of $1,320 in 2015 and
$1,681 in 2014 2,452 3,121
Reclassification adjustment, net of income tax
(benefit) of $1 in 2015 and $0 in 2014 1 ---
---------- ----------
Other comprehensive income, net of tax of $1,321 and
$1,681 for the periods ended March 31, 2015 and 2014,
respectively $ 2,453 $ 3,121
---------- ----------
Total Comprehensive Income $ 6,419 $ 7,525
========== ==========
National Bankshares, Inc. and Subsidiaries
Key Ratios and Other Data
(Unaudited)
Three Months Ended
March 31, March 31,
$ in thousands 2015 2014
---------- ----------
Average Balances
Cash and due from banks $ 11,364 $ 11,937
Interest-bearing deposits 104,104 103,024
Securities available for sale 222,161 184,497
Securities held to maturity 159,376 162,782
Restricted stock 1,095 1,385
Mortgage loans held for sale 460 382
Gross Loans 605,137 592,338
Loans, net 604,288 583,189
Intangible assets 7,109 8,185
Total assets 1,149,578 1,108,867
Total deposits 973,738 953,703
Other borrowings --- ---
Stockholders' equity 169,289 149,877
Interest-earning assets 1,092,481 1,062,323
Interest-bearing liabilities 821,308 812,690
Financial ratios
Return on average assets 1.40% 1.61%
Return on average equity 9.50% 11.92%
Net interest margin 3.95% 4.12%
Net interest income-fully taxable equivalent $ 10,648 $ 10,799
Efficiency ratio 52.05% 47.56%
Average equity to average assets 14.73% 13.52%
Allowance for loan losses
Beginning balance $ 8,263 $ 8,227
Provision for losses 201 103
Charge-offs (260) (191)
Recoveries 53 158
---------- ----------
Ending balance $ 8,257 $ 8,297
========== ==========
National Bankshares, Inc. and Subsidiaries
Asset Quality Data
(Unaudited)
$ in thousands
March 31, March 31,
Nonperforming assets 2015 2014
---------- ----------
Nonaccrual loans $ 3,102 $ 5,071
Nonaccrual restructured loans 6,123 1,007
---------- ----------
Total nonperforming loans 9,225 6,078
Other real estate owned 4,573 4,901
---------- ----------
Total nonperforming assets $ 13,798 $ 10,979
========== ==========
Accruing restructured loans 5,992 6,145
========== ==========
Loans 90 days or more past due $ 272 $ 163
========== ==========
Asset quality ratios
Nonperforming assets to loans net of unearned income
and deferred fees, plus other real estate owned 2.20% 1.85%
Allowance for loans losses to total loans 1.33% 1.41%
Allowance for loan losses to nonperforming loans 89.51% 136.51%
Loans past due 90 days or more to loans net of
unearned income and deferred fees 0.04% 0.03%
CONTACTS: JAMES G. RAKES CHAIRMAN, PRESIDENT & CEO (540) 951-6236 Email Contact DAVID K. SKEENS TREASURER & CFO (540) 951-6347 Email Contact
Source: National Bankshares, Inc.
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