EX-99.1 2 vabk-ex99_1.htm EX-99.1 EX-99.1

 

Exhibit 99.1

img2203825_0.jpg 

FOR IMMEDIATE RELEASE

INVESTOR RELATIONS CONTACT:

 

Tara Y. Harrison (434) 817-8587

 

VIRGINIA NATIONAL BANKSHARES CORPORATION

ANNOUNCES 2024 FIRST QUARTER EARNINGS

Charlottesville, VA – April 23, 2024 - Virginia National Bankshares Corporation (NASDAQ: VABK) (the “Company”) today reported quarterly net income of $3.6 million, or $0.68 per diluted share, for the quarter ended March 31, 2024, compared to $3.2 million, or $0.59 per diluted share, recognized for the quarter ended December 31, 2023 and $5.8 million, or $1.08 per diluted share, recognized for the quarter ended March 31, 2023.

"The Company achieved solid first quarter results," stated Glenn W. Rust, President and Chief Executive Officer. "We increased our loan balances 20% year-over-year and our credit quality metrics remain strong. During the first quarter, we increased deposit balances, refrained from utilizing brokered funds and reduced our level of debt, which stabilized our cost of funds. During the same period, we maintained solid capital and liquidity positions."

2024 First Quarter Highlights

•
The Company continued to experience loan growth in the first quarter of 2024. Gross loans outstanding as of March 31, 2024 totaled $1.1 billion, an increase of $35.5 million, or 3.2%, compared to December 31, 2023 and an increase of $188.2 million, or 20.0%, compared to March 31, 2023.
•
Yield on loans elevated to 5.64% for the three months ended March 31, 2024, from 5.55% for the prior year same period.
•
Credit performance remains strong with nonperforming assets as a percentage of total assets of 0.19% as of March 31, 2024, 0.17% as of December 31, 2023 and 0.08% as of March 31, 2023.
•
The Company utilizes a third-party to offer multi-million-dollar FDIC insurance to customers with balances in excess of single-bank limits through Insured Cash Sweep® (ICS) plans. Deposit balances held in ICS plans amounted to $144.0 million as of March 31, 2024, $134.6 million as of December 31, 2023 and $126.4 million as of March 31, 2023.
•
Total deposits increased $22.9 million, or 1.6% from December 31, 2023 to March 31, 2024 and increased $34.7 million, or 2.5% year-over-year. Management believes that the Bank's cost of funds has stabilized during the first quarter of 2024.
•
Correlated with the year-over-year deposit increase noted above, and in an effort to stabilize overall cost of funds, borrowings decreased from December 31, 2023 to March 31, 2024 by $46.5 million. As of March 31, 2024, the Company had unused borrowing facilities in place of approximately $189.2 million.
•
Securities balances declined $80.9 million in the first quarter of 2024, as funds from the maturities of investments were repurposed to higher yielding assets in the form of loans and federal funds sold.
•
Effective April 1, 2024, the Company sold the membership interests in Masonry Capital Management, LLC to an officer of the Company. Subsequent to the date of sale, the Company will receive an annual revenue-share amount for a period of six years. No expenses will be incurred by the Company related to Masonry Capital subsequent to the effective date of sale.

 

Page 1 of 8

 

 

Loans and Asset Quality

•
Nonperforming assets amounted to $3.1 million as of March 31, 2024, compared to $2.7 million as of December 31, 2023 and $1.3 million as of March 31, 2023;
o
Nine loans to seven borrowers are in non-accrual status, totaling $2.2 million, as of March 31, 2024, compared to $1.9 million as of December 31, 2023 and $1.2 million as of March 31, 2023.
o
Loans 90 days or more past due and still accruing interest amounted to $876 thousand as of March 31, 2024, compared to $880 thousand as of December 31, 2023 and $69 thousand as of March 31, 2023. The past due balance as of March 31, 2024 is comprised of two loans totaling $783 thousand which are 100% government-guaranteed, and five student loans totaling $93 thousand.
o
The Company currently holds no other real estate owned.
•
The period-end Allowance for Credit Losses (“ACL”) as a percentage of total loans was 0.73% as of March 31, 2024, 0.77% as of December 31, 2023 and 0.83% as of March 31, 2023. The proportionate increase in government-guaranteed loans over the respective periods is the driver of the decrease in the ACL as a percentage of total loans. Balances in government-guaranteed loans have increased $32.2 million during the first quarter of 2024 and have increased $112.9 million since March 31, 2023. Such loans are 100% government-guaranteed and do not require an ACL.
•
The fair value mark that was allocated to the acquired loans was $21.3 million as of April 1, 2021, with a remaining balance of $8.8 million as of March 31, 2024.
•
For the three months ended March 31, 2024, the Company recorded a net recovery of provision for credit losses of $22 thousand, which includes a $33 thousand recovery of provision for unfunded commitments.

Net Interest Income

•
Net interest income for the three months ended March 31, 2024 of $10.9 million decreased $2.5 million, or 18.5%, compared to the three months ended March 31, 2023, as the increase in interest expense on deposit accounts and borrowings outweighed the increase in interest income earned on assets.
•
Net interest margin (FTE), (a non-GAAP financial measure)1, for the three months ended March 31, 2024 declined to 2.93%, compared to 3.71% for the three months ended March 31, 2023, yet increased from 2.89% for the three months ended December 31, 2023.
•
The overall cost of funds, including noninterest-bearing deposits, of 211 bps incurred in the three months ended March 31, 2024 increased 128 bps from 83 bps in the same period in the prior year. Overall, the cost of interest-bearing deposits increased period over period, from a cost of 109 bps to 273 bps. As stated above, management believes that the Bank's cost of funds has stabilized during the first quarter of 2024.

Noninterest Income

Noninterest income for the three months ended March 31, 2024 decreased $98 thousand, or 4.3%, compared to the three months ended March 31, 2023, primarily as a result of the gain on termination of an interest rate swap in the first quarter of 2023 being larger than the gain on termination of debt in the first quarter of 2024 by $81 thousand.

Noninterest Expense

Noninterest expense for the three months ended March 31, 2024 decreased $42 thousand, or 0.5%, compared to the three months ended March 31, 2023. This decrease is primarily the result of lower occupancy costs from right-sizing our branch network from the merger and reduced marketing, advertising and promotion expense.

Book Value

Book value per share increased to $28.31 as of March 31, 2024, compared to $26.50 as of March 31, 2023, and tangible book value per share (a non-GAAP financial measure)1 was $25.99 as of March 31, 2024 compared to $23.88 as of March 31, 2023. These values increased as net retained income increased and unrealized losses in the investment portfolio remained relatively constant period over period.

Income Taxes

The effective tax rates amounted to 15.5% and 18.2% for the three months ended March 31, 2024 and 2023, respectively, which are lower than the statutory rate, due to the recognition of low-income housing tax credits and the effect of tax-exempt income from municipal bonds and income from bank owned life insurance policies.

_____________________________________________________________________

1 See "Reconciliation of Certain Quarterly Non-GAAP Financial Measures" at the end of this release.

 

Page 2 of 8

 

 

Dividends

Cash dividends of $1.8 million, or $0.33 per share, were declared and paid during the first quarter of 2024.

Share Repurchase Plan

During the first quarter of 2024, the Company enacted a share repurchase plan, repurchasing 874 shares at an average price of $29.60 per share. The Company will continue to repurchase shares in the second quarter in accordance with its share repurchase plan.

 

About Virginia National Bankshares Corporation

Virginia National Bankshares Corporation, headquartered in Charlottesville, Virginia, is the bank holding company for Virginia National Bank. The Bank has nine banking offices throughout Fauquier and Prince William counties, three banking offices in Charlottesville and Albemarle County, and banking offices in Winchester and Richmond, Virginia. The Bank offers a full range of banking and related financial services to meet the needs of individuals, businesses and charitable organizations, including the fiduciary services of VNB Trust and Estate Services. The Company’s common stock trades on the Nasdaq Capital Market under the symbol “VABK.” Additional information on the Company is also available at www.vnbcorp.com.

Non-GAAP Financial Measures

The accounting and reporting policies of the Company conform to U.S. generally accepted accounting principles (“GAAP”) and prevailing practices in the banking industry. However, management uses certain non-GAAP measures to supplement the evaluation of the Company’s performance. Management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s core businesses. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of GAAP to non-GAAP measures are included at the end of this release.

Forward-Looking Statements; Other Information

Certain statements in this release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, without limitation, statements with respect to the Company’s operations, performance, future strategy and goals, and are often characterized by use of qualified words such as “expect,” “believe,” “estimate,” “project,” “anticipate,” “intend,” “will,” “should,” or words of similar meaning or other statements concerning the opinions or judgement of the Company and its management about future events. While Company management believes such statements to be reasonable, future events and predictions are subject to circumstances that are not within the control of the Company and its management. Actual results may differ materially from those included in the forward-looking statements due to a number of factors, including, without limitation, the effects of and changes in: inflation, interest rates, market and monetary fluctuations; liquidity and capital requirements; market disruptions including pandemics or significant health hazards, severe weather conditions, natural disasters, terrorist activities, financial crises, political crises, war and other military conflicts or other major events, the governmental and societal responses thereto, or the prospect of these events; changes, particularly declines, in general economic and market conditions in the local economies in which the Company operates, including the effects of declines in real estate values; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; the impact of changes in laws, regulations and guidance related to financial services including, but not limited to, taxes, banking, securities and insurance; changes in accounting principles, policies and guidelines; the financial condition of the Company’s borrowers; the Company's ability to attract, hire, train and retain qualified employees; an increase in unemployment levels; competitive pressures on loan and deposit pricing and demand; fluctuation in asset quality; assumptions that underlie the Company’s ACL; the value of securities held in the Company's investment portfolio; performance of assets under management; cybersecurity threats or attacks and the development and maintenance of reliable electronic systems; changes in technology and their impact on the marketing of new products and services and the acceptance of these products and services by new and existing customers; the willingness of customers to substitute competitors’ products and services for the Company’s products and services; the risks and uncertainties described from time to time in the Company’s press releases and filings with the SEC; and the Company’s performance in managing the risks involved in any of the foregoing. Many of these factors and additional risks and uncertainties are described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 and other reports filed from time to time by the Company with the Securities and Exchange Commission. These statements speak only as of the date made, and the Company does not undertake to update any forward-looking statements to reflect changes or events that may occur after this release.

 

Page 3 of 8

 

 

VIRGINIA NATIONAL BANKSHARES CORPORATION

CONSOLIDATED BALANCE SHEETS

(dollars in thousands, except per share data)

 

 

March 31, 2024

 

 

December 31, 2023*

 

 

(Unaudited)

 

 

 

 

ASSETS

 

 

 

 

 

Cash and due from banks

$

7,158

 

 

$

18,074

 

Interest-bearing deposits in other banks

 

10,639

 

 

 

10,316

 

Federal funds sold

 

27,696

 

 

 

-

 

Securities:

 

 

 

 

 

Available for sale (AFS), at fair value

 

341,857

 

 

 

420,595

 

Restricted securities, at cost

 

6,192

 

 

 

8,385

 

Total securities

 

348,049

 

 

 

428,980

 

Loans, net of deferred fees and costs

 

1,128,168

 

 

 

1,092,665

 

Allowance for credit losses

 

(8,289

)

 

 

(8,395

)

Loans, net

 

1,119,879

 

 

 

1,084,270

 

Premises and equipment, net

 

15,860

 

 

 

16,195

 

Bank owned life insurance

 

39,179

 

 

 

38,904

 

Goodwill

 

7,768

 

 

 

7,768

 

Core deposit intangible, net

 

4,750

 

 

 

5,093

 

Right of use asset, net

 

6,652

 

 

 

6,748

 

Deferred tax asset, net

 

15,744

 

 

 

15,382

 

Accrued interest receivable and other assets

 

16,122

 

 

 

14,287

 

Total assets

$

1,619,496

 

 

$

1,646,017

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

 

Liabilities:

 

 

 

 

 

Demand deposits:

 

 

 

 

 

Noninterest-bearing

$

382,315

 

 

$

372,857

 

Interest-bearing

 

284,789

 

 

 

305,541

 

Money market and savings deposit accounts

 

415,311

 

 

 

412,119

 

Certificates of deposit and other time deposits

 

349,557

 

 

 

318,581

 

Total deposits

 

1,431,972

 

 

 

1,409,098

 

Federal funds purchased

 

-

 

 

 

3,462

 

Borrowings

 

20,000

 

 

 

66,500

 

Junior subordinated debt, net

 

3,471

 

 

 

3,459

 

Lease liability

 

6,451

 

 

 

6,504

 

Accrued interest payable and other liabilities

 

5,025

 

 

 

3,954

 

Total liabilities

 

1,466,919

 

 

 

1,492,977

 

Commitments and contingent liabilities

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

Preferred stock, $2.50 par value

 

-

 

 

 

-

 

Common stock, $2.50 par value

 

13,277

 

 

 

13,253

 

Capital surplus

 

108,084

 

 

 

107,940

 

Retained earnings

 

73,768

 

 

 

71,891

 

Accumulated other comprehensive loss

 

(42,552

)

 

 

(40,044

)

Total shareholders' equity

 

152,577

 

 

 

153,040

 

Total liabilities and shareholders' equity

$

1,619,496

 

 

$

1,646,017

 

Common shares outstanding

 

5,390,388

 

 

 

5,365,982

 

Common shares authorized

 

10,000,000

 

 

 

10,000,000

 

Preferred shares outstanding

 

-

 

 

 

-

 

Preferred shares authorized

 

2,000,000

 

 

 

2,000,000

 

 

 

* Derived from audited consolidated financial statements

 

Page 4 of 8

 

 

VIRGINIA NATIONAL BANKSHARES CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(dollars in thousands, except per share data)

 

 

For the three months ended

 

 

 

March 31, 2024

 

 

December 31,
2023 *

 

March 31, 2023

 

 

 

(Unaudited)

 

 

 

 

(Unaudited)

 

Interest and dividend income:

 

 

 

 

 

 

 

 

Loans, including fees

 

$

15,661

 

 

$

14,644

 

$

12,767

 

Federal funds sold

 

 

239

 

 

 

64

 

 

-

 

Other interest-bearing deposits

 

 

57

 

 

 

59

 

 

258

 

Investment securities:

 

 

 

 

 

 

 

 

Taxable

 

 

2,159

 

 

 

2,880

 

 

2,951

 

Tax exempt

 

 

326

 

 

 

325

 

 

327

 

Dividends

 

 

118

 

 

 

102

 

 

67

 

Total interest and dividend income

 

 

18,560

 

 

 

18,074

 

 

16,370

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

Demand deposits

 

 

71

 

 

 

73

 

 

89

 

Money market and savings deposits

 

 

2,922

 

 

 

2,964

 

 

1,773

 

Certificates and other time deposits

 

 

4,050

 

 

 

3,508

 

 

648

 

Borrowings

 

 

486

 

 

 

663

 

 

386

 

Federal funds purchased

 

 

7

 

 

 

26

 

 

-

 

Junior subordinated debt

 

 

88

 

 

 

87

 

 

61

 

Total interest expense

 

 

7,624

 

 

 

7,321

 

 

2,957

 

Net interest income

 

 

10,936

 

 

 

10,753

 

 

13,413

 

Provision for (recovery of) credit losses

 

 

(22

)

 

 

794

 

 

(248

)

Net interest income after provision for (recovery of) credit losses

 

 

10,958

 

 

 

9,959

 

 

13,661

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

Wealth management fees

 

 

426

 

 

 

756

 

 

404

 

Deposit account fees

 

 

387

 

 

 

389

 

 

401

 

Debit/credit card and ATM fees

 

 

488

 

 

 

535

 

 

571

 

Bank owned life insurance income

 

 

275

 

 

 

270

 

 

252

 

Gains (losses) on sales of assets, net

 

 

39

 

 

 

(20

)

 

(1

)

Gain on termination of debt

 

 

379

 

 

 

-

 

 

-

 

Gain on termination of interest rate swap

 

 

-

 

 

 

-

 

 

460

 

Losses on sales of AFS, net

 

 

(4

)

 

 

-

 

 

(206

)

Other

 

 

188

 

 

 

206

 

 

395

 

Total noninterest income

 

 

2,178

 

 

 

2,136

 

 

2,276

 

 

 

 

 

 

 

 

 

 

Noninterest expense:

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

4,152

 

 

 

3,851

 

 

4,051

 

Net occupancy

 

 

972

 

 

 

918

 

 

1,179

 

Equipment

 

 

171

 

 

 

173

 

 

218

 

Bank franchise tax

 

 

340

 

 

 

291

 

 

324

 

Computer software

 

 

208

 

 

 

188

 

 

202

 

Data processing

 

 

739

 

 

 

799

 

 

742

 

FDIC deposit insurance assessment

 

 

195

 

 

 

170

 

 

100

 

Marketing, advertising and promotion

 

 

248

 

 

 

186

 

 

375

 

Professional fees

 

 

252

 

 

 

82

 

 

192

 

Core deposit intangible amortization

 

 

343

 

 

 

355

 

 

391

 

Other

 

 

1,199

 

 

 

1,285

 

 

1,087

 

Total noninterest expense

 

 

8,819

 

 

 

8,298

 

 

8,861

 

Income before income taxes

 

 

4,317

 

 

 

3,797

 

 

7,076

 

Provision for income taxes

 

 

671

 

 

 

629

 

 

1,285

 

Net income

 

$

3,646

 

 

$

3,168

 

$

5,791

 

Net income per common share, basic

 

$

0.68

 

 

$

0.59

 

$

1.08

 

Net income per common share, diluted

 

$

0.68

 

 

$

0.59

 

$

1.08

 

Weighted average common shares outstanding, basic

 

 

5,366,890

 

 

 

5,365,982

 

 

5,338,099

 

Weighted average common shares outstanding, diluted

 

 

5,380,081

 

 

 

5,394,713

 

 

5,375,619

 

 

 

 

 

 

 

 

 

 

* Derived from audited consolidated financial statements

 

 

 

 

 

 

 

 

 

Page 5 of 8

 

 

VIRGINIA NATIONAL BANKSHARES CORPORATION

FINANCIAL HIGHLIGHTS

(dollars in thousands, except per share data)

(Unaudited)

 

 

At or For the Three Months Ended

 

 

 

March 31, 2024

 

 

December 31, 2023

 

 

September 30, 2023

 

 

June 30,
2023

 

 

March 31, 2023

 

Common Share Data:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per weighted average share, basic

 

$

0.68

 

 

$

0.59

 

 

$

0.87

 

 

$

1.05

 

 

$

1.08

 

Net income per weighted average share, diluted

 

$

0.68

 

 

$

0.59

 

 

$

0.86

 

 

$

1.05

 

 

$

1.08

 

Weighted average shares outstanding, basic

 

 

5,366,890

 

 

 

5,365,982

 

 

 

5,365,982

 

 

 

5,357,873

 

 

 

5,338,099

 

Weighted average shares outstanding, diluted

 

 

5,380,081

 

 

 

5,394,713

 

 

 

5,395,483

 

 

 

5,375,073

 

 

 

5,375,619

 

Actual shares outstanding

 

 

5,390,388

 

 

 

5,365,982

 

 

 

5,365,982

 

 

 

5,365,982

 

 

 

5,338,650

 

Tangible book value per share at period end (non-GAAP) 5

 

$

25.99

 

 

$

26.12

 

 

$

22.83

 

 

$

24.01

 

 

$

23.88

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Key Ratios:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets 1

 

 

0.91

%

 

 

0.79

%

 

 

1.18

%

 

 

1.46

%

 

 

1.48

%

Return on average equity 1

 

 

9.57

%

 

 

9.03

%

 

 

12.91

%

 

 

15.98

%

 

 

17.57

%

Net interest margin (FTE) 2

 

 

2.93

%

 

 

2.89

%

 

 

3.04

%

 

 

3.83

%

 

 

3.71

%

Efficiency ratio (FTE) 3

 

 

66.8

%

 

 

64.0

%

 

 

60.3

%

 

 

54.1

%

 

 

56.2

%

Loan-to-deposit ratio

 

 

78.8

%

 

 

77.5

%

 

 

74.5

%

 

 

72.2

%

 

 

67.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Interest Income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

10,936

 

 

$

10,753

 

 

$

11,100

 

 

$

13,703

 

 

$

13,413

 

Net interest income (FTE) 2

 

$

11,023

 

 

$

10,839

 

 

$

11,187

 

 

$

13,789

 

 

$

13,500

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Ratios:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tier 1 leverage ratio

 

 

11.24

%

 

 

11.13

%

 

 

11.26

%

 

 

11.20

%

 

 

10.64

%

Total risk-based capital ratio

 

 

18.39

%

 

 

18.24

%

 

 

18.76

%

 

 

18.80

%

 

 

18.37

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets and Asset Quality:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average earning assets

 

$

1,513,924

 

 

$

1,487,910

 

 

$

1,460,555

 

 

$

1,443,048

 

 

$

1,475,617

 

Average gross loans

 

$

1,117,570

 

 

$

1,061,297

 

 

$

986,480

 

 

$

940,264

 

 

$

932,834

 

Fair value mark on acquired loans

 

$

8,811

 

 

$

9,399

 

 

$

9,965

 

 

$

10,957

 

 

$

14,120

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for credit losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning of period

 

$

8,395

 

 

$

7,799

 

 

$

7,863

 

 

$

7,772

 

 

$

5,552

 

Impact of adoption of CECL

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

2,491

 

Provision for (recovery of) credit losses

 

 

11

 

 

 

713

 

 

 

2

 

 

 

216

 

 

 

(235

)

Charge-offs

 

 

(184

)

 

 

(207

)

 

 

(199

)

 

 

(180

)

 

 

(136

)

Recoveries

 

 

67

 

 

 

90

 

 

 

133

 

 

 

55

 

 

 

100

 

Net charge-offs

 

 

(117

)

 

 

(117

)

 

 

(66

)

 

 

(125

)

 

 

(36

)

End of period

 

$

8,289

 

 

$

8,395

 

 

$

7,799

 

 

$

7,863

 

 

$

7,772

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-accrual loans

 

$

2,178

 

 

$

1,852

 

 

$

1,143

 

 

$

1,185

 

 

$

1,228

 

Loans 90 days or more past due and still accruing

 

 

876

 

 

 

880

 

 

 

854

 

 

 

107

 

 

 

69

 

Total nonperforming assets (NPA) 4

 

$

3,054

 

 

$

2,732

 

 

$

1,997

 

 

$

1,292

 

 

$

1,297

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NPA as a % of total assets

 

 

0.19

%

 

 

0.17

%

 

 

0.13

%

 

 

0.08

%

 

 

0.08

%

NPA as a % of gross loans

 

 

0.27

%

 

 

0.25

%

 

 

0.20

%

 

 

0.13

%

 

 

0.14

%

ACL to gross loans

 

 

0.73

%

 

 

0.77

%

 

 

0.76

%

 

 

0.81

%

 

 

0.83

%

Non-accruing loans to gross loans

 

 

0.19

%

 

 

0.17

%

 

 

0.11

%

 

 

0.12

%

 

 

0.13

%

Net charge-offs to average loans 1

 

 

0.04

%

 

 

0.04

%

 

 

0.03

%

 

 

0.05

%

 

 

0.02

%

 

1 Ratio is computed on an annualized basis.

2 The net interest margin and net interest income are reported on a fully tax-equivalent basis (FTE) basis, using a Federal income tax rate of 21%. This is a non-GAAP financial measure. Refer to the Reconciliation of Certain Non-GAAP Financial (FTE) Measures at the end of this release.

3 The efficiency ratio (FTE) is computed as a percentage of noninterest expense divided by the sum of net interest income (FTE) and noninterest income. This is a non-GAAP financial measure that management believes provides investors with important information regarding operational efficiency. Management believes such financial information is meaningful to the reader in understanding operating performance, but cautions that such information should not be viewed as a substitute for GAAP. Comparison of our efficiency ratio with those of other companies may not be possible because other companies may calculate them differently. Refer to the Reconciliation of Certain Non-GAAP Financial (FTE) Measures at the end of this release.

4 The Bank held no other real estate owned during any of the periods presented.

5 This is a non-GAAP financial measure. Refer to the Reconciliation of Certain Non-GAAP Financial (FTE) Measures at the end of this release.

 

Page 6 of 8

 

 

VIRGINIA NATIONAL BANKSHARES CORPORATION

AVERAGE BALANCES, INCOME AND EXPENSES, YIELDS AND RATES (TAXABLE EQUIVALENT BASIS)

(dollars in thousands)

(Unaudited)

 

 

 

For the three months ended

 

 

 

March 31, 2024

 

 

March 31, 2023

 

 

 

 

 

 

Interest

 

 

 

 

 

 

 

 

Interest

 

 

 

 

 

 

Average

 

 

Income/

 

 

Average

 

 

Average

 

 

Income/

 

 

Average

 

 

 

Balance

 

 

Expense

 

 

Yield/Cost

 

 

Balance

 

 

Expense

 

 

Yield/Cost

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Earning Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable Securities

 

$

303,736

 

 

$

2,277

 

 

 

3.00

%

 

$

447,428

 

 

$

3,018

 

 

 

2.70

%

Tax Exempt Securities 1

 

 

66,589

 

 

 

413

 

 

 

2.48

%

 

 

67,083

 

 

 

414

 

 

 

2.47

%

Total Securities 1

 

 

370,325

 

 

 

2,690

 

 

 

2.91

%

 

 

514,511

 

 

 

3,432

 

 

 

2.67

%

Loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real Estate

 

 

905,485

 

 

 

12,543

 

 

 

5.57

%

 

 

816,742

 

 

 

11,140

 

 

 

5.53

%

Commercial

 

 

174,377

 

 

 

2,424

 

 

 

5.59

%

 

 

72,035

 

 

 

874

 

 

 

4.92

%

Consumer

 

 

37,708

 

 

 

694

 

 

 

7.40

%

 

 

44,057

 

 

 

753

 

 

 

6.93

%

      Total Loans

 

 

1,117,570

 

 

 

15,661

 

 

 

5.64

%

 

 

932,834

 

 

 

12,767

 

 

 

5.55

%

Fed Funds Sold

 

 

17,624

 

 

 

239

 

 

 

5.45

%

 

 

10

 

 

 

—

 

 

 

0.00

%

Other interest-bearing deposits

 

 

8,405

 

 

 

57

 

 

 

2.73

%

 

 

28,262

 

 

 

258

 

 

 

3.70

%

Total Earning Assets

 

 

1,513,924

 

 

 

18,647

 

 

 

4.95

%

 

 

1,475,617

 

 

 

16,457

 

 

 

4.52

%

Less: Allowance for Credit Losses

 

 

(8,413

)

 

 

 

 

 

 

 

 

(8,091

)

 

 

 

 

 

 

Total Non-Earning Assets

 

 

109,862

 

 

 

 

 

 

 

 

 

114,477

 

 

 

 

 

 

 

Total Assets

 

$

1,615,373

 

 

 

 

 

 

 

 

$

1,582,003

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Bearing Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Bearing Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Checking

 

$

282,825

 

 

$

71

 

 

 

0.10

%

 

$

361,894

 

 

$

89

 

 

 

0.10

%

Money Market and Savings Deposits

 

 

411,973

 

 

 

2,922

 

 

 

2.85

%

 

 

448,870

 

 

 

1,773

 

 

 

1.60

%

Time Deposits

 

 

341,083

 

 

 

4,050

 

 

 

4.78

%

 

 

127,386

 

 

 

648

 

 

 

2.06

%

Total Interest-Bearing Deposits

 

 

1,035,881

 

 

 

7,043

 

 

 

2.73

%

 

 

938,150

 

 

 

2,510

 

 

 

1.09

%

Borrowings

 

 

42,154

 

 

 

486

 

 

 

4.64

%

 

 

32,978

 

 

 

386

 

 

 

—

 

Federal funds purchased

 

 

495

 

 

 

7

 

 

 

5.69

%

 

 

—

 

 

 

—

 

 

 

—

 

Junior subordinated debt

 

 

3,465

 

 

 

88

 

 

 

10.21

%

 

 

3,417

 

 

 

61

 

 

 

7.24

%

Total Interest-Bearing Liabilities

 

 

1,081,995

 

 

 

7,624

 

 

 

2.83

%

 

 

974,545

 

 

 

2,957

 

 

 

1.23

%

Non-Interest-Bearing Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

 

368,535

 

 

 

 

 

 

 

 

 

464,801

 

 

 

 

 

 

 

Other liabilities

 

 

11,537

 

 

 

 

 

 

 

 

 

8,989

 

 

 

 

 

 

 

Total Liabilities

 

 

1,462,067

 

 

 

 

 

 

 

 

 

1,448,335

 

 

 

 

 

 

 

Shareholders' Equity

 

 

153,306

 

 

 

 

 

 

 

 

 

133,668

 

 

 

 

 

 

 

Total Liabilities & Shareholders' Equity

 

$

1,615,373

 

 

 

 

 

 

 

 

$

1,582,003

 

 

 

 

 

 

 

Net Interest Income (FTE)

 

 

 

 

$

11,023

 

 

 

 

 

 

 

 

$

13,500

 

 

 

 

Interest Rate Spread 2

 

 

 

 

 

 

 

 

2.12

%

 

 

 

 

 

 

 

 

3.29

%

Cost of Funds

 

 

 

 

 

 

 

 

2.11

%

 

 

 

 

 

 

 

 

0.83

%

Interest Expense as a Percentage of
     Average Earning Assets

 

 

 

 

 

 

 

 

2.03

%

 

 

 

 

 

 

 

 

0.81

%

Net Interest Margin (FTE) 3

 

 

 

 

 

 

 

 

2.93

%

 

 

 

 

 

 

 

 

3.71

%

 

1 Tax-exempt income for investment securities has been adjusted to a fully tax-equivalent basis (FTE), using a Federal income tax rate of 21%.

Refer to the Reconcilement of Non-GAAP Measures table at the end of this release.

2 Interest spread is the average yield earned on earning assets less the average rate paid on interest-bearing liabilities.

3 Net interest margin (FTE) is net interest income expressed as a percentage of average earning assets.

 

 

 

Page 7 of 8

 

 

 

 

 

VIRGINIA NATIONAL BANKSHARES CORPORATION

RECONCILIATION OF CERTAIN QUARTERLY NON-GAAP FINANCIAL MEASURES

(dollars in thousands, except per share data)

(Unaudited)

 

 

 

 

For the Three Months Ended

 

 

 

March 31, 2024

 

 

December 31, 2023

 

 

September 30, 2023

 

 

June 30, 2023

 

 

March 31, 2023

 

Fully tax-equivalent measures

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

10,936

 

 

$

10,753

 

 

$

11,100

 

 

$

13,703

 

 

$

13,413

 

Fully tax-equivalent adjustment

 

 

87

 

 

 

86

 

 

 

87

 

 

 

86

 

 

 

87

 

Net interest income (FTE) 1

 

$

11,023

 

 

$

10,839

 

 

$

11,187

 

 

$

13,789

 

 

$

13,500

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Efficiency ratio 2

 

 

67.2

%

 

 

64.4

%

 

 

60.7

%

 

 

54.4

%

 

 

56.5

%

Fully tax-equivalent adjustment

 

 

-0.4

%

 

 

-0.4

%

 

 

-0.4

%

 

 

-0.3

%

 

 

-0.3

%

Efficiency ratio (FTE) 3

 

 

66.8

%

 

 

64.0

%

 

 

60.3

%

 

 

54.1

%

 

 

56.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin

 

 

2.91

%

 

 

2.87

%

 

 

3.02

%

 

 

3.81

%

 

 

3.69

%

Fully tax-equivalent adjustment

 

 

0.02

%

 

 

0.02

%

 

 

0.02

%

 

 

0.02

%

 

 

0.02

%

Net interest margin (FTE) 1

 

 

2.93

%

 

 

2.89

%

 

 

3.04

%

 

 

3.83

%

 

 

3.71

%

 

 

 

 

As of

 

 

 

March 31, 2024

 

 

December 31, 2023

 

 

September 30, 2023

 

 

June 30, 2023

 

 

March 31, 2023

 

Other financial measures

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Book value per share

 

$

28.31

 

 

$

28.52

 

 

$

25.29

 

 

$

26.54

 

 

$

26.50

 

Impact of intangible assets 4

 

 

(2.32

)

 

 

(2.40

)

 

 

(2.46

)

 

 

(2.53

)

 

 

(2.62

)

Tangible book value per share (non-GAAP)

 

$

25.99

 

 

$

26.12

 

 

$

22.83

 

 

$

24.01

 

 

$

23.88

 

 

1 FTE calculations use a Federal income tax rate of 21%.

2 The efficiency ratio, GAAP basis, is computed by dividing noninterest expense by the sum of net interest income and noninterest income.

3 The efficiency ratio, FTE, is computed by dividing noninterest expense by the sum of net interest income (FTE) and noninterest income.

4 Intangible assets include goodwill and core deposit intangible assets, net of accumulated amortization, for all periods presented.

 

Page 8 of 8