ex99-1.htm

City’s CEO Charles Hageboeck stated that, “In a difficult economic climate, City’s financial performance in the third quarter was solid. Our net interest margin was up; the company experienced loan and deposit growth, and asset quality remained strong and stable compared to peers. The third quarter marks the first full quarter since our acquisition of Virginia Savings Bank, which was completed on May 31, 2012. Additionally, City announced in August 2012 the execution of a definitive agreement to acquire Community Financial Corporation of Staunton, Virginia. The proposed merger is expected to close in the first quarter of 2013 subject to pending regulatory approvals, the approval of Community’s shareholders, and the completion of other customary closing conditions. This transaction will significantly expand City’s presence in Virginia and complements our recently completed acquisition of Virginia Savings Bancorp, Inc.”

“City’s results for the third quarter of 2012 are down slightly as compared to the third quarter of 2011 because we recorded no provision for loan losses during the quarter ended September 30, 2011. Net interest income increased $1.3 million from the third quarter of 2011 despite $38 million of higher yielding trust preferred securities being called during the third quarter of 2012. The resultant decrease in net interest income of approximately $0.6 million related to the trust preferred securities was more than offset from additional interest income associated with the acquisition of Virginia Savings Bancorp, Inc. Our net interest margin remained solid at 3.95% for the third quarter of 2012.”

The Company’s tax equivalent net interest income increased $1.1 million, or 4.3%, from $24.0 million during the second quarter of 2012 to $25.1 million during the third quarter of 2012. This increase is primarily due to the acquisition of Virginia Savings Bancorp, Inc. that was partially offset by lower interest income due to approximately $38 million of higher yielding trust preferred securities being called during the third quarter of 2012. The Company’s reported net interest margin increased from 3.91% for the quarter ended June 30, 2012 to 3.95% for the quarter ended September 30, 2012. Excluding the favorable impact of acquisition accounting fair value adjustments ($0.95 million), the net interest margin for the third quarter of 2012 would have been 3.80%.

As a result of the Company’s quarterly analysis of the adequacy of the ALLL, the Company recorded a provision for loan losses of $1.0 million in the third quarter of 2012, compared to no provision for the comparable period in 2011 and $1.7 million for the second quarter of 2012. During the third quarter of 2012, the Company received life insurance proceeds as the beneficiary of a life insurance policy carried by a commercial borrower that allowed the Company to reduce the ALLL by approximately $0.6 million for amounts previously included in the ALLL. In addition, charge-offs for commercial real estate loans were primarily related to a specific credit that had been appropriately considered in establishing the allowance for loan losses in prior periods. Changes in the amount of the provision and related allowance are based on the Company’s detailed systematic methodology and are directionally consistent with changes in the composition and quality of the Company’s loan portfolio. The Company believes its methodology for determining the adequacy of its ALLL adequately provides for probable losses inherent in the loan portfolio and produces a provision and allowance for loan losses that is directionally consistent with changes in asset quality and loss experience.

During the third quarter of 2012, the Company sold certain equity positions related to community banks and bank holding companies and realized a $0.4 million gain. The Company also recognized gains of $0.3 million associated with the calls of trust preferred securities during the quarter. These gains were partially offset by $0.3 million of credit-related net investment impairment losses recorded by the Company during the third quarter of 2012. The charges deemed to be other than temporary were related to pooled bank trust preferreds with a remaining carrying value of $3.5 million at September 30, 2012. The credit-related net impairment charges were based on the Company’s quarterly reviews of its investment securities for indications of losses considered to be other than temporary.

Non-interest expenses increased $2.1 million from $19.7 million in the third quarter of 2011 to $21.8 million in the third quarter of 2012. Salaries and employee benefits increased $1.0 million primarily due to the acquisition of Virginia Savings Bancorp, Inc. ($0.4 million) and increased health insurance costs ($0.4 million). Repossessed asset losses increased $0.3 million due to declines in estimated fair values of two foreclosed properties located at the Greenbrier Resort in West Virginia. The Company continually reevaluates the estimated fair value of properties that it has repossessed by obtaining updated appraisals on at least an annual basis. In addition, other expenses increased $0.3 million, bankcard expenses increased $0.2 million, and merger related expenses increased $0.2 million.

This news release contains certain forward-looking statements that are included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such information involves risks and uncertainties that could result in the Company's actual results differing from those projected in the forward-looking statements. Important factors that could cause actual results to differ materially from those discussed in such forward-looking statements include, but are not limited to, (1) the Company may incur additional loan loss provision due to negative credit quality trends in the future that may lead to a deterioration of asset quality; (2) the Company may incur increased charge-offs in the future; (3) the Company could have adverse legal actions of a material nature; (4) the Company may face competitive loss of customers; (5) the Company may be unable to manage its expense levels; (6) the Company may have difficulty retaining key employees; (7) changes in the interest rate environment may have results on the Company’s operations materially different from those anticipated by the Company’s market risk management functions; (8) changes in general economic conditions and increased competition could adversely affect the Company’s operating results; (9) changes in other regulations and government policies affecting bank holding companies and their subsidiaries, including changes in monetary policies, could negatively impact the Company’s operating results; (10) the Company may experience difficulties growing loan and deposit balances; (11) the current economic environment poses significant challenges for us and could adversely affect our financial condition and results of operations; (12) continued deterioration in the financial condition of the U.S. banking system may impact the valuations of investments the Company has made in the securities of other financial institutions resulting in either actual losses or other than temporary impairments on such investments; (13) the effects of the Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) recently adopted by the United States Congress and (14) the merger with Community Financial Corporation will not be consummated unless certain conditions are met. Forward-looking statements made herein reflect management’s expectations as of the date such statements are made. Forward-looking statements made herein reflect management's expectations as of the date such statements are made. Such information is provided to assist stockholders and potential investors in understanding current and anticipated financial operations of the Company and is included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances that arise after the date such statements are made. Further, the Company is required to evaluate subsequent events through the filing of its June 30, 2012 Form 10-Q. The Company will continue to evaluate the impact of any subsequent events on the preliminary June 30, 2012 results and will adjust the amounts if necessary.

CITY HOLDING COMPANY AND SUBSIDIARIES
Financial Highlights
(Unaudited)


	Three Months Ended September 30,						Percent
	2012			2011			Change

Earnings ($000s, except per share data):
Net Interest Income (FTE)	$	25,060		$	23,783			5.37	%
Net Income available to common shareholders		10,607			11,577			(8.38	)%
Earnings per Basic Share		0.71			0.77			(6.88	)%
Earnings per Diluted Share		0.71			0.76			(6.98	)%


Key Ratios (percent):
Return on Average Assets		1.47	%		1.71	%		(13.99	)%
Return on Average Tangible Equity		16.20	%		17.81	%		(9.06	)%
Net Interest Margin		3.95	%		3.93	%		0.47	%
Efficiency Ratio		56.40	%		53.18	%		6.05	%
Average Shareholders' Equity to Average Assets		11.32	%		11.67	%		(2.94	)%

Consolidated Risk Based Capital Ratios (a):
Tier I		12.89	%		13.21	%		(2.42	)%
Total		13.79	%		14.20	%		(2.89	)%

Tangible Equity to Tangible Assets		9.29	%		9.65	%		(3.69	)%


Common Stock Data:
Cash Dividends Declared per Share	$	0.35		$	0.34			2.94	%
Book Value per Share		22.14			20.86			6.16	%
Tangible Book Value per Share		17.75			17.07			3.99	%
Market Value per Share:
High		36.43			33.96			7.27	%
Low		32.37			26.82			20.69	%
End of Period		35.84			26.99			32.79	%

Price/Earnings Ratio (b)		12.56			8.81			42.61	%

	Nine Months Ended September 30,						Percent
		2012			2011		Change

Earnings ($000s, except per share data):
Net Interest Income (FTE)	$	72,829		$	69,606			4.63	%
Net Income available to common shareholders		28,049			31,024			(9.59	)%
Earnings per Basic Share		1.89			2.03			(6.80	)%
Earnings per Diluted Share		1.88			2.02			(6.85	)%


Key Ratios (percent):
Return on Average Assets		1.33	%		1.53	%		(13.12	)%
Return on Average Tangible Equity		14.26	%		15.90	%		(10.31	)%
Net Interest Margin		3.95	%		3.89	%		1.55	%
Efficiency Ratio		58.59	%		57.42	%		2.04	%
Average Shareholders' Equity to Average Assets		11.45	%		11.72	%		(2.33	)%


Common Stock Data:
Cash Dividends Declared per Share	$	1.05		$	1.02			2.94	%
Market Value per Share:
High		37.16			37.22			(0.16	)%
Low		30.96			26.82			15.44	%

Price/Earnings Ratio (b)		14.20			9.97			42.48	%


(a) September 30, 2012 risk-based capital ratios are estimated
(b) September 30, 2012 price/earnings ratio computed based on annualized third quarter 2012 earnings

CITY HOLDING COMPANY AND SUBSIDIARIES
Financial Highlights
(Unaudited)



Book Value and Market Price Range per Share
										Market Price
	Book Value per Share									Range per Share
	March 31		June 30		September 30			December 31		Low		High

2008	$	18.92	$	18.72	$	17.61		$	17.58	$	29.08	$	42.88
2009		17.69		18.24		18.95			19.37		20.88		34.34
2010		19.71		20.02		20.31			20.31		26.87		38.03
2011		20.39		20.58		20.86			21.05		26.06		37.22
2012		21.46		21.63		22.14					30.96		37.16


Earnings per Basic Share

	Quarter Ended
	March 31		June 30		September 30			December 31		Year-to-Date

2008	$	0.81	$	0.83	$	(0.16	)	$	0.26	$	1.74
2009		0.69		0.64		0.66			0.70		2.69
2010		0.59		0.68		0.58			0.64		2.48
2011		0.62		0.65		0.77			0.65		2.68
2012		0.68		0.50		0.71					1.89


Earnings per Diluted Share

	Quarter Ended
	March 31		June 30		September 30			December 31		Year-to-Date

2008	$	0.80	$	0.83	$	(0.16	)	$	0.26	$	1.74
2009		0.69		0.64		0.66			0.70		2.68
2010		0.58		0.68		0.58			0.64		2.47
2011		0.62		0.64		0.76			0.65		2.67
2012		0.67		0.50		0.71					1.88

CITY HOLDING COMPANY AND SUBSIDIARIES
Consolidated Statements of Income
(Unaudited) ($ in 000s, except per share data)

	Three Months Ended September 30,
	2012			2011

Interest Income
Interest and fees on loans	$	24,633		$	23,326
Interest on investment securities:
Taxable		3,438			4,639
Tax-exempt		346			392
Interest on federal funds sold		15			13
Total Interest Income		28,432			28,370

Interest Expense
Interest on deposits		3,312			4,550
Interest on short-term borrowings		79			90
Interest on long-term debt		166			159
Total Interest Expense		3,557			4,799
Net Interest Income		24,875			23,571
Provision for loan losses		975			-
Net Interest Income After Provision for Loan Losses		23,900			23,571

Non-Interest Income
Total investment securities impairment losses		(272	)		(1,849	)
Noncredit impairment losses recognized in other comprehensive income		-			1,494
Net investment securities impairment losses		(272	)		(355	)
Gains on sale of investment securities		730			627
Net investment securities gains		458			272

Service charges		9,861			9,840
Insurance commissions		1,439			1,388
Trust and investment management fee income		912			699
Bank owned life insurance		738			952
Other income		671			380
Total Non-Interest Income		14,079			13,531

Non-Interest Expense
Salaries and employee benefits		11,295			10,302
Occupancy and equipment		2,126			2,057
Depreciation		1,175			1,131
FDIC insurance expense		405			392
Advertising		674			546
Bankcard expenses		720			559
Postage, delivery, and statement mailings		529			551
Office supplies		407			492
Legal and professional fees		611			567
Telecommunications		433			371
Repossessed asset (gains)/losses, net of expenses		429			109
Merger related expenses		157			-
Other expenses		2,885			2,611
Total Non-Interest Expense		21,846			19,688
Income Before Income Taxes		16,133			17,414
Income tax expense		5,526			5,837
Net Income Available to Common Shareholders	$	10,607		$	11,577


Distributed earnings allocated to common shareholders	$	5,150		$	5,015
Undistributed earnings allocated to common shareholders		5,373			6,479
Net earnings allocated to common shareholders	$	10,523		$	11,494

Average common shares outstanding		14,751			15,003
Effect of dilutive securities:
Employee stock options		83			68
Shares for diluted earnings per share		14,834			15,071

Basic earnings per common share	$	0.71		$	0.77
Diluted earnings per common share	$	0.71		$	0.76
Dividends declared per common share	$	0.35		$	0.34

Comprehensive Income	$	12,719		$	10,714

CITY HOLDING COMPANY AND SUBSIDIARIES
Consolidated Statements of Income
(Unaudited) ($ in 000s, except per share data)

	Nine months ended September 30,
	2012			2011

Interest Income
Interest and fees on loans	$	70,843		$	70,416
Interest on investment securities:
Taxable		11,345			13,694
Tax-exempt		1,101			1,299
Interest on federal funds sold		38			39
Total Interest Income		83,327			85,448

Interest Expense
Interest on deposits		10,363			15,829
Interest on short-term borrowings		229			239
Interest on long-term debt		499			474
Total Interest Expense		11,091			16,542
Net Interest Income		72,236			68,906
Provision for loan losses		4,600			2,372
Net Interest Income After Provision for Loan Losses		67,636			66,534

Non-Interest Income
Total investment securities impairment losses		(878	)		(1,849	)
Noncredit impairment losses recognized in other comprehensive income		302			1,494
Net investment securities impairment losses		(576	)		(355	)
Gains on sale of investment securities		1,530			3,756
Net investment securities gains		954			3,401

Service charges		28,601			28,749
Insurance commissions		4,782			4,513
Trust and investment management fee income		2,662			2,181
Bank owned life insurance		2,228			2,455
Other income		1,762			1,434
Total Non-Interest Income		40,989			42,733

Non-Interest Expense
Salaries and employee benefits		32,207			30,397
Occupancy and equipment		6,038			6,084
Depreciation		3,371			3,408
FDIC insurance expense		1,184			2,276
Advertising		1,993			1,854
Bankcard expenses		2,035			1,693
Postage, delivery, and statement mailings		1,565			1,615
Office supplies		1,258			1,483
Legal and professional fees		1,349			4,547
Telecommunications		1,209			1,217
Repossessed asset losses, net of expenses		1,200			300
Merger related expenses		4,335			-
Other expenses		8,382			7,585
Total Non-Interest Expense		66,126			62,459
Income Before Income Taxes		42,499			46,808
Income tax expense		14,450			15,784
Net Income Available to Common Shareholders	$	28,049		$	31,024


Distributed earnings allocated to common shareholders	$	15,451		$	15,045

Undistributed earnings allocated to common shareholders		12,375			15,756

Net earnings allocated to common shareholders	$	27,826		$	30,801

Average common shares outstanding		14,700			15,165

Effect of dilutive securities:
Employee stock options		83			77

Shares for diluted earnings per share		14,783			15,242

Basic earnings per common share	$	1.89		$	2.03
Diluted earnings per common share	$	1.88		$	2.02
Dividends declared per common share	$	1.05		$	1.02

Comprehensive Income	$	31,591		$	30,820

CITY HOLDING COMPANY AND SUBSIDIARIES
Consolidated Statements of Changes in Stockholders' Equity
(Unaudited) ($ in 000s)


	Three Months Ended
	September 30, 2012			September 30, 2011

Balance at July 1	$	320,622		$	310,379

Net income		10,607			11,577
Other comprehensive income:
Change in unrealized (loss) gain on securities available-for-sale		2,112			(863	)
Cash dividends declared ($0.35/share) and ($0.34/share), respectively		(5,196	)		(5,073	)
Issuance of stock award shares, net		214			201
Exercise of 2,000 stock options		56			-
Exercise of 1,100 stock options		-			15
Purchase of 227,977 common shares of treasury		-			(6,344	)
Balance at September 30	$	328,415		$	309,892



	Nine Months Ended
	September 30, 2012			September 30, 2011

Balance at January 1	$	311,134		$	314,861

Net income		28,049			31,024
Other comprehensive income:
Change in unrealized gain on securities available-for-sale		3,542			91
Change in unrealized (loss) on interest rate floors		-			(295	)
Cash dividends declared ($1.05/share) and ($1.02/share), respectively		(15,532	)		(15,394	)
Issuance of stock award shares, net		870			867
Acquisition of Virginia Savings Bancorp		7,723			-
Exercise of 18,899 stock options		544			-
Exercise of 6,576 stock options		-			168
Purchase of 237,535 common shares of treasury		(7,915	)		-
Purchase of 675,501 common shares of treasury		-			(21,430	)
Balance at September 30	$	328,415		$	309,892

CITY HOLDING COMPANY AND SUBSIDIARIES
Condensed Consolidated Quarterly Statements of Income
(Unaudited) ($ in 000s, except per share data)

	Quarter Ended
	September 30			June 30			March 31			December 31			September 30
	2012			2012			2012			2011			2011

Interest income	$	28,432		$	27,466		$	27,430		$	27,441		$	28,370
Taxable equivalent adjustment		185			198			208			215			212
Interest income (FTE)		28,617			27,664			27,638			27,656			28,582
Interest expense		3,557			3,625			3,908			4,216			4,799
Net interest income		25,060			24,039			23,730			23,440			23,783
Provision for loan losses		975			1,675			1,950			2,229			-
Net interest income after provision
for loan losses		24,085			22,364			21,780			21,211			23,783

Noninterest income		14,079			13,790			13,118			12,128			13,531
Noninterest expense		21,846			24,763			19,515			18,685			19,688
Income before income taxes		16,318			11,391			15,383			14,654			17,626
Income tax expense		5,526			3,780			5,144			4,787			5,837
Taxable equivalent adjustment		185			198			208			215			212
Net income available to common shareholders	$	10,607		$	7,413		$	10,031		$	9,652		$	11,577



Distributed earnings allocated to common shareholders	$	5,150		$	5,146		$	5,118		$	5,136		$	5,015
Undistributed earnings allocated to common shareholders		5,373			2,208			4,837			4,446			6,479
Net earnings allocated to common shareholders	$	10,523		$	7,354		$	9,955		$	9,582		$	11,494

Average common shares outstanding		14,751			14,680			14,679			14,743			15,003

Effect of dilutive securities:
Employee stock options		83			79			80			71			68

Shares for diluted earnings per share		14,834			14,759			14,759			14,814			15,071

Basic earnings per common share	$	0.71		$	0.50		$	0.68		$	0.65		$	0.77
Diluted earnings per common share		0.71			0.50			0.67			0.65			0.76

Cash dividends declared per share		0.35			0.35			0.35			0.35			0.34


Net Interest Margin		3.95	%		3.91	%		3.98	%		3.90	%		3.93	%

CITY HOLDING COMPANY AND SUBSIDIARIES
Non-Interest Income and Non-Interest Expense
(Unaudited) ($ in 000s)

	Quarter Ended
	September 30			June 30			March 31			December 31			September 30
	2012			2012			2012			2011			2011

Non-Interest Income:
Service charges	$	9,861		$	9,649		$	9,090		$	9,360		$	9,840
Insurance commissions		1,439			1,347			1,996			1,433			1,388
Trust and investment management fee income		912			942			807			925			699
Bank owned life insurance		738			766			723			728			952
Other income		671			558			533			599			380
Subtotal		13,621			13,262			13,149			13,045			13,259
Total investment securities impairment losses		(272	)		(606	)		-			(918	)		(1,849	)
Noncredit impairment losses recognized in other
comprehensive income		-			302			-			-			1,494
Net investment securities impairment losses		(272	)		(304	)		-			(918	)		(355	)
Gain (loss) on sale of investment securities		730			832			(31	)		1			627
Total Non-Interest Income	$	14,079		$	13,790		$	13,118		$	12,128		$	13,531

Non-Interest Expense:
Salaries and employee benefits	$	11,295		$	10,668		$	10,245		$	10,320		$	10,302
Occupancy and equipment		2,126			1,978			1,935			1,929			2,057
Depreciation		1,175			1,109			1,086			1,100			1,131
FDIC insurance expense		405			394			385			300			392
Advertising		674			675			644			153			546
Bankcard expenses		720			694			620			566			559
Postage, delivery and statement mailings		529			488			548			484			551
Office supplies		407			396			455			429			492
Legal and professional fees		611			421			317			366			567
Telecommunications		433			387			389			388			371
Repossessed asset (gains) losses, net of expenses		429			650			121			(27	)		109
Merger related expenses		157			4,042			135			-			-
Other expenses		2,885			2,861			2,635			2,677			2,611
Total Non-Interest Expense	$	21,846		$	24,763		$	19,515		$	18,685		$	19,688


Employees (Full Time Equivalent)		836			831			797			795			792
Branch Locations		73			73			68			68			68

CITY HOLDING COMPANY AND SUBSIDIARIES
Consolidated Balance Sheets
($ in 000s)
	September 30			December 31
	2012			2011
	(Unaudited)
Assets
Cash and due from banks	$	72,309		$	140,873
Interest-bearing deposits in depository institutions		5,563			5,526
Federal funds sold		35,000			-
Cash and cash equivalents		112,872			146,399

Investment securities available-for-sale, at fair value		389,686			360,783
Investment securities held-to-maturity, at amortized cost		13,444			23,458
Other securities		11,459			11,934
Total investment securities		414,589			396,175

Gross loans		2,085,232			1,973,103
Allowance for loan losses		(18,986	)		(19,409	)
Net loans		2,066,246			1,953,694

Bank owned life insurance		81,146			78,961
Premises and equipment, net		72,360			64,612
Accrued interest receivable		7,681			7,093
Net deferred tax assets		32,407			32,219
Intangible assets		65,103			56,164
Other assets		46,793			41,792
Total Assets	$	2,899,197		$	2,777,109

Liabilities
Deposits:
Noninterest-bearing	$	407,634		$	369,025
Interest-bearing:
Demand deposits		549,752			526,824
Savings deposits		495,068			439,823
Time deposits		929,042			885,596
Total deposits		2,381,496			2,221,268
Short-term borrowings
Federal Funds purchased		-			75,000
Customer repurchase agreements		131,947			114,050
Long-term debt		16,495			16,495
Other liabilities		40,844			39,162
Total Liabilities		2,570,782			2,465,975

Stockholders' Equity
Preferred stock, par value $25 per share: 500,000 shares authorized; none issued		-			-
Common stock, par value $2.50 per share: 50,000,000 shares authorized;
18,499,282 shares issued at September 30, 2012 and December 31, 2011
less 3,665,999 and 3,717,993 shares in treasury, respectively		46,249			46,249
Capital surplus		103,311			103,335
Retained earnings		303,567			291,050
Cost of common stock in treasury		(124,347	)		(125,593	)
Accumulated other comprehensive loss:
Unrealized gain on securities available-for-sale		4,367			825
Underfunded pension liability		(4,732	)		(4,732	)
Total Accumulated Other Comprehensive Loss		(365	)		(3,907	)
Total Stockholders' Equity		328,415			311,134
Total Liabilities and Stockholders' Equity	$	2,899,197		$	2,777,109

CITY HOLDING COMPANY AND SUBSIDIARIES
Investment Portfolio
(Unaudited) ($ in 000s)

	Original Cost		Credit-Related Net Investment Impairment Losses through September 30, 2012			Unrealized Gains (Losses)			Carrying Value

US Government Agencies	$	4,309	$	-		$	105		$	4,414
Mortgage Backed Securities		289,260		-			8,693			297,953
Municipal Bonds		48,334		-			1,799			50,133
Pooled Bank Trust Preferreds		26,917		(20,171	)		(3,250	)		3,496
Single Issuer Bank Trust Preferreds,
Subdebt of Financial Institutions, and
Bank Holding Company Preferred Stocks		43,435		(1,015	)		(1,001	)		41,419
Money Markets and Mutual Funds		1,725		-			68			1,793
Federal Reserve Bank and FHLB stock		11,459		-			-			11,459
Community Bank Equity Positions		8,194		(4,813	)		541			3,922
Total Investments	$	433,633	$	(25,999	)	$	6,955		$	414,589

CITY HOLDING COMPANY AND SUBSIDIARIES
Loan Portfolio
(Unaudited) ($ in 000s)

	September 30		June 30		March 31		December 31		September 30
	2012		2012		2012		2011		2011

Residential real estate (1)	$	1,008,305	$	997,016	$	939,611	$	929,788	$	916,122
Home equity - junior liens		143,058		143,400		139,764		141,797		142,028
Commercial and industrial		105,027		116,288		108,707		130,899		119,377
Commercial real estate (2)		787,887		768,176		745,586		732,146		708,558
Consumer		38,285		37,383		35,448		35,845		36,575
DDA overdrafts		2,670		3,326		2,848		2,628		2,924
Previously securitized loans		-		-		-		-		214
Gross Loans	$	2,085,232	$	2,065,589	$	1,971,964	$	1,973,103	$	1,925,798

Construction loans included in:
(1) - Residential real estate loans	$	12,787	$	11,919	$	11,613	$	9,287	$	7,456
(2) - Commercial real estate loans	$	17,072	$	18,544	$	20,661	$	20,201	$	23,915

CITY HOLDING COMPANY AND SUBSIDIARIES
Consolidated Average Balance Sheets, Yields, and Rates
(Unaudited) ($ in 000s)

	Three Months Ended September 30,
				2012								2011
	Average					Yield/			Average					Yield/
	Balance			Interest		Rate			Balance			Interest		Rate

Assets:
Loan portfolio (1):
Residential real estate	$	1,140,910		$	13,000		4.53	%	$	1,046,155		$	12,054		4.57	%
Commercial, financial, and agriculture		880,243			10,069		4.55	%		825,353			9,575		4.60	%
Installment loans to individuals (2)		49,111			782		6.33	%		45,461			906		7.91	%
Previously securitized loans (3)		***			781		***			277			791		1132.93	%
Total loans		2,070,264			24,632		4.73	%		1,917,246			23,326		4.83	%
Securities:
Taxable		372,877			3,438		3.67	%		399,468			4,639		4.61	%
Tax-exempt (4)		36,761			532		5.76	%		42,249			604		5.67	%
Total securities		409,638			3,970		3.86	%		441,717			5,243		4.71	%
Deposits in depository institutions		7,063			-		-			7,497			-		-
Federal funds sold		35,487			15		0.17	%		32,204			13		0.16	%
Total interest-earning assets		2,522,452			28,617		4.51	%		2,398,664			28,582		4.73	%
Cash and due from banks		80,335								61,387
Bank premises and equipment		72,640								64,900
Other assets		232,793								206,943
Less: Allowance for loan losses		(19,889	)							(20,496	)
Total assets	$	2,888,331							$	2,711,398

Liabilities:
Interest-bearing demand deposits		539,189			180		0.13	%		496,866			224		0.18	%
Savings deposits		497,208			204		0.16	%		427,391			260		0.24	%
Time deposits		931,369			2,928		1.25	%		913,040			4,066		1.77	%
Short-term borrowings		122,955			79		0.26	%		132,487			90		0.27	%
Long-term debt		16,495			166		4.00	%		16,495			159		3.82	%
Total interest-bearing liabilities		2,107,216			3,557		0.67	%		1,986,279			4,799		0.96	%
Noninterest-bearing demand deposits		418,584								383,736
Other liabilities		35,461								25,054
Stockholders' equity		327,070								316,329
Total liabilities and
stockholders' equity	$	2,888,331							$	2,711,398
Net interest income				$	25,060							$	23,783
Net yield on earning assets							3.95	%							3.93	%



(1) For purposes of this table, non-accruing loans have been included in average balances and loan fees, which are immaterial, have been included in interest income.
(2) Includes the Company’s consumer and DDA overdrafts loan categories.
(3) Effective January 1, 2012, the carrying value of the Company's previously securitized loans was reduced to $0.
(4) Computed on a fully federal tax-equivalent basis assuming a tax rate of approximately 35%.

CITY HOLDING COMPANY AND SUBSIDIARIES
Consolidated Average Balance Sheets, Yields, and Rates
(Unaudited) ($ in 000s)

	Nine Months Ended September 30,
				2012								2011
	Average					Yield/			Average					Yield/
	Balance			Interest		Rate			Balance			Interest		Rate

Assets:
Loan portfolio (1):
Residential real estate (2)	$	1,101,805		$	36,731		4.45	%	$	1,033,830		$	36,905		4.77	%
Commercial, financial, and agriculture (3)		873,295			29,395		4.50	%		805,386			28,492		4.73	%
Installment loans to individuals (4)		45,756			2,303		6.72	%		45,713			2,570		7.52	%
Previously securitized loans (5)		***			2,414		***			452			2,449		724.40	%
Total loans		2,020,856			70,843		4.68	%		1,885,381			70,416		4.99	%
Securities:
Taxable		367,800			11,345		4.12	%		422,777			13,694		4.33	%
Tax-exempt (6)		39,176			1,694		5.78	%		47,077			1,999		5.68	%
Total securities		406,976			13,039		4.28	%		469,854			15,693		4.47	%
Deposits in depository institutions		7,200			-		-			7,815			-		-
Federal funds sold		29,712			38		0.17	%		31,348			39		0.17	%
Total interest-earning assets		2,464,744			83,920		4.55	%		2,394,398			86,148		4.81	%
Cash and due from banks		75,576								56,923
Bank premises and equipment		68,788								64,560
Other assets		221,661								204,909
Less: Allowance for loan losses		(19,599	)							(19,290	)
Total assets	$	2,811,170							$	2,701,500

Liabilities:
Interest-bearing demand deposits		532,231			531		0.13	%		490,691			711		0.19	%
Savings deposits		473,626			576		0.16	%		415,740			790		0.25	%
Time deposits		905,561			9,256		1.37	%		941,808			14,328		2.03	%
Short-term borrowings		119,454			229		0.26	%		121,350			239		0.26	%
Long-term debt		16,495			499		4.04	%		16,495			474		3.84	%
Total interest-bearing liabilities		2,047,367			11,091		0.72	%		1,986,084			16,542		1.11	%
Noninterest-bearing demand deposits		408,435								377,460
Other liabilities		33,612								21,368
Stockholders' equity		321,756								316,588
Total liabilities and
stockholders' equity	$	2,811,170							$	2,701,500
Net interest income				$	72,829							$	69,606
Net yield on earning assets							3.95	%							3.89	%

(1) For purposes of this table, non-accruing loans have been included in average balances and loan fees, which are immaterial, have been included in interest income.
(2) Interest income includes $0 and $632 from interest rate floors for the nine months ended September 30, 2012 and September 30, 2011, respectively.
(3) Includes the Company’s commercial and industrial and commercial real estate loan categories. Interest income includes $0 and $488 from interest rate floors for the nine months ended September 30, 2012 and September 30, 2011, respectively.
(4) Includes the Company’s consumer and DDA overdrafts loan categories.
(5) Effective January 1, 2012, the carrying value of the Company's previously securitized loans was reduced to $0.
(6) Computed on a fully federal tax-equivalent basis assuming a tax rate of approximately 35%.

CITY HOLDING COMPANY AND SUBSIDIARIES
Analysis of Risk-Based Capital
(Unaudited) ($ in 000s)

	September 30			June 30			March 31			December 31			September 30
	2012 (a)			2012			2012			2011			2011

Tier I Capital:
Stockholders' equity	$	328,415		$	320,622		$	316,046		$	311,134		$	309,892
Goodwill and other intangibles		(64,912	)		(64,971	)		(55,871	)		(55,969	)		(56,071	)
Accumulated other comprehensive loss		365			2,477			1,737			3,907			2,701
Qualifying trust preferred stock		16,000			16,000			16,000			16,000			16,000
Unrealized loss on AFS securities		-			-			-			(448	)		(1,081	)
Excess deferred tax assets		(7,472	)		(7,847	)		(4,020	)		(5,897	)		(5,435	)
Total tier I capital	$	272,397		$	266,282		$	273,892		$	268,727		$	266,007


Total Risk-Based Capital:
Tier I capital	$	272,397		$	266,282		$	273,892		$	268,727		$	266,007
Qualifying allowance for loan losses		18,986			19,452			18,628			19,409			19,848
Total risk-based capital	$	291,383		$	285,734		$	292,520		$	288,136		$	285,855

Net risk-weighted assets	$	2,112,581		$	2,136,249		$	2,050,520		$	2,048,398		$	2,013,294


Ratios:
Average stockholders' equity to average assets		11.32	%		11.47	%		11.55	%		11.65	%		11.67	%
Tangible capital ratio		9.29	%		9.03	%		9.54	%		9.37	%		9.65	%
Risk-based capital ratios:
Tier I capital		12.89	%		12.46	%		13.36	%		13.12	%		13.21	%
Total risk-based capital		13.79	%		13.38	%		14.27	%		14.07	%		14.20	%
Leverage capital		9.67	%		9.74	%		10.23	%		10.18	%		10.04	%


(a) September 30, 2012 risk-based capital ratios are estimated




CITY HOLDING COMPANY AND SUBSIDIARIES
Intangibles
(Unaudited) ($ in 000s)

	As of and for the Quarter Ended
	September 30			June 30			March 31			December 31			September 30
		2012			2012			2012			2011			2011

Intangibles, net	$	65,103		$	65,162		$	56,066		$	56,164		$	56,266
Intangibles amortization expense		135			109			98			102			102

CITY HOLDING COMPANY AND SUBSIDIARIES
Summary of Loan Loss Experience
(Unaudited) ($ in 000s)

	Quarter Ended
	September 30			June 30			March 31			December 31			September 30
	2012			2012			2012			2011			2011

Balance at beginning of period	$	19,452		$	18,628		$	19,409		$	19,848		$	18,944

Charge-offs:
Commercial and industrial		9			48			69			247			200
Commercial real estate		845			26			1,989			1,650			141
Residential real estate		252			296			198			176			264
Home equity		133			347			509			475			209
Consumer		53			36			59			31			75
DDA overdrafts		418			375			335			394			492
Total charge-offs		1,710			1,128			3,159			2,973			1,381

Recoveries:
Commercial and industrial		10			-			3			15			2
Commercial real estate		3			-			96			-			1,954
Residential real estate		8			3			4			10			1
Home equity		1			10			1			1			1
Consumer		26			35			29			29			58
DDA overdrafts		221			229			295			250			269
Total recoveries		269			277			427			305			2,285

Net charge-offs		1,441			851			2,731			2,668			(904	)
Provision for loan losses		975			1,675			1,950			2,229			-
Balance at end of period	$	18,986		$	19,452		$	18,628		$	19,409		$	19,848

Loans outstanding	$	2,085,232		$	2,065,589		$	1,971,964		$	1,973,103		$	1,925,798
Average loans outstanding		2,070,264			2,019,281			1,972,478			1,940,950			1,917,246
Allowance as a percent of loans outstanding		0.91	%		0.94	%		0.94	%		0.98	%		1.03	%
Allowance as a percent of non-performing loans		82.61	%		88.92	%		88.78	%		87.76	%		87.27	%
Net charge-offs (annualized) as a
percent of average loans outstanding		0.28	%		0.17	%		0.55	%		0.55	%		(0.19	)%
Net charge-offs, excluding overdraft deposit
accounts, (annualized) as a percent of average loans outstanding		0.24	%		0.14	%		0.55	%		0.52	%		(0.24	)%

CITY HOLDING COMPANY AND SUBSIDIARIES
Summary of Non-Performing Assets
(Unaudited) ($ in 000s)

	September 30			June 30			March 31			December 31			September 30
	2012			2012			2012			2011			2011

Nonaccrual loans	$	22,586		$	21,726		$	20,420		$	21,951		$	22,423
Accruing loans past due 90 days or more(1)		397			149			562			166			320
Total non-performing loans		22,983			21,875			20,982			22,117			22,743
Other real estate owned		9,017			8,697			8,250			7,948			8,273
Total non-performing assets	$	32,000		$	30,572		$	29,232		$	30,065		$	31,016

Non-performing assets as a percent of loans and
other real estate owned		1.53	%		1.47	%		1.48	%		1.52	%		1.60	%



CITY HOLDING COMPANY AND SUBSIDIARIES
Summary of Total Past Due Loans
(Unaudited) ($ in 000s)

	September 30			June 30			March 31			December 31			September 30
		2012			2012			2012			2011			2011

Residential real estate	$	4,909		$	5,575		$	4,108		$	5,362		$	4,569
Home equity		2,643			1,864			1,560			2,246			2,425
Commercial and industrial		25			540			63			1,243			37
Commercial real estate		1,271			3,145			2,636			3,415			2,423
Consumer		136			90			58			138			112
Previously securitized loans		-			-			-			-			403
DDA overdrafts		319			364			304			909			614
Total past due loans	$	9,303		$	11,578		$	8,729		$	13,313		$	10,583

Past due loans as a percent of loans outstanding		0.45	%		0.56	%		0.44	%		0.67	%		0.55	%