8-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) July 21,2016
AMERICAN NATIONAL BANKSHARES INC.
(Exact name of registrant as specified in its charter)
Virginia	0-12820	54-1284688
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)
Registrant’s telephone number, including area code: 434-792-5111
Not Applicable
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
þ	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13a-4(c))

Item 2.02 Results of Operations and Financial Condition

On July 21, 2016, American National Bankshares Inc. ("the Company") reports earnings for second quarter 2016.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits:

99.1  July 21, 2016 News Release

99.2 Quarterly Balance Sheets, Statements of Income, Net Interest Income Analysis and Selected Financial Data

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: July 21, 2016                                                                 /s/ William W. Traynham

Executive Vice President and Chief Financial Officer

EX-99.1

Date:	July 21, 2016
Contact:	William W. Traynham, Chief Financial Officer
	434-773-2242
	traynhamw@amnb.com
Traded:	NASDAQ Global Select Market	Symbol:	AMNB

AMERICAN NATIONAL BANKSHARES INC. REPORTS SECOND QUARTER 2016 EARNINGS

• Organic loan growth of $75.1 million (7.6%) during last four quarters

• Q2 2016 net income of $4.1 million and diluted EPS of $0.47

• Net interest margin of 3.45% for Q2 2016

• Average shareholders’ equity of $201.7 million is 12.67% of average assets

Danville, VA -- American National Bankshares Inc. (“American National”) (NASDAQ: AMNB), parent company of American National Bank and Trust Company, today announced net income of $4,088,000 compared to $2,880,000 for the second quarter of 2015, a $1,208,000 or 41.9% increase. Basic and diluted net income per common share was $0.47 for the 2016 quarter compared to $0.33 for the 2015 quarter. Net income for the second quarter of 2016 produced annualized returns on average assets of 1.03%, on average equity of 8.11%, and on average tangible equity of 10.99%.

Net income for the first six months of 2016 was $8,216,000 compared to $6,395,000 for the comparable period of 2015, a $1,821,000 or 28.5% increase. Basic and diluted net income per common share was $0.95 for the 2016 period compared to $0.73 for the 2015 period.

Financial Performance and Overview

Jeffrey V. Haley, President and Chief Executive Officer, reported, “We are seeing improving economic conditions in our markets and this is resulting in increased demand for credit. Loans have increased $75.1 million or 7.6% during the past year. In the past six months, loans have increased $52.4 million or 5.2%. We are very encouraged that a

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combination of active business development and gradually improving local market economic conditions are resulting in this high quality growth. However, the continuing challenge for our industry in this competitive environment is achieving reasonable risk adjusted yield on our earning assets.

“Loans don’t exist in isolation; they require liquidity. Deposits have grown $64.4 million or 5.2% over the past year. In the past six months, deposits have grown $35.7 million or 2.8%. This growth is mostly in non-maturity, core deposits, the heart of our balance sheet. We continue working to grow these core deposits and their affiliated relationships, but the challenge in this ongoing low rate environment is to do that in a cost effective yet competitive manner. Our cost of interest bearing deposits for the second quarter was 0.54%, compared to 0.50% for the 2015 quarter.

“On the earnings side, net income for the second quarter was $4,088,000 compared to $2,880,000, an increase of $1,208,000 or 41.9%.

“The major driver was the noninterest expense, which was reduced $1,986,000 or 17.1%. This mostly related to non-recurring MainStreet acquisition expenses, which totaled $1,502,000 in the second quarter 2015.

“We also saw significant expense reduction in salaries, which declined $277,000 or 6.4% compared to the second quarter of 2015. Full time equivalent employees for the current quarter were 302, down from 322 for the prior year quarter. The magnitude of the decrease was directly related to the completion and integration of the MainStreet acquisition.”

Haley concluded, “The first half of 2016 has been very productive for American National. Average loan balances this quarter are $75.2 million or 7.7% greater than the second quarter of 2015. American National will continue to grow its balance sheet and maintain high asset quality. However, capital will remain a strategic priority.”

Capital

American National’s capital ratios remain strong and exceed all regulatory requirements.

For the quarter ended June 30, 2016, average shareholders’ equity was 12.67% of average assets, compared to 12.85% for the quarter ended June 30, 2015.

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Book value per common share was $23.54 at June 30, 2016, compared to $22.43 at June 30, 2015.

Tangible book value per common share was $18.20 at June 30, 2016, compared to $16.96 at June 30, 2015.

Credit Quality Measurements

Non-performing assets ($3,412,000 of non-performing loans and $1,289,000 of other real estate owned) represented 0.29% of total assets at June 30, 2016, compared to 0.39% at June 30, 2015.

Annualized net charge offs to average loans was two basis points (0.02%) for the 2016 second quarter, compared to six basis points (0.06%) for the same quarter in 2015.

Other real estate owned was $1,289,000 compared to $2,113,000 at June 30, 2015, a decrease of $824,000 or 39.0%.

Acquisition Related Financial Impact

The acquisition accounting adjustments related to our two recent acquisitions have had and continue to have a positive impact on net interest income and income before income tax for American National. The impact of the adjustments is summarized below (dollars in thousands):

Acquisition related financial impact
For the quarter ended June 30,	2016		2015
Net interest income	$	352	$	843
Income before Income taxes	$	64	$	543
For the period ended June 30,	2016		2015
Net interest income	$	1,353	$	1,955
Income before Income taxes	$	777	$	1,354

During the first quarter of 2016, the Company received two substantial payoffs of purchased credit impaired loans from our 2011 MidCarolina acquisition that resulted in $460,000 in cash-basis accretion income.

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Net Interest Income

Net interest income before the provision for loan losses decreased to $12,160,000 in the second quarter of 2016 from $12,382,000 in the second quarter of 2015, a decrease of $222,000 or 1.8%.

For the 2016 quarter, the net interest margin was 3.45% compared to 3.69% for the same quarter in 2015, a decrease of 24 basis points (0.24%). The decrease in net interest income and margin was mostly driven by reduced levels of accretion income.

Provision for Loan Losses and Allowance for Loan Losses

Provision expense for the second quarter of 2016 was $50,000 compared to $100,000 for the second quarter of 2015.

The allowance for loan losses as a percentage of total loans was 1.20% at June 30, 2016 compared to 1.30% at June 30, 2015.

There was significant growth in the loans outstanding in the second quarter 2016, a net of $23.4 million or 2.3%. The need for additions to the allowance for loan losses was reduced by improvement in various qualitative factors used in the determination of the allowance, notably asset quality and local economic conditions. As noted in the Credit Quality discussion, non-performing assets, charge-offs, and other real estate owned are all improved over the past year.

Noninterest Income

Noninterest income totaled $3,367,000 in the second quarter of 2016, compared with $3,258,000 in the second quarter of 2015, an increase of $109,000 or 3.3%. There was very little change in most revenue categories during the quarter.

Noninterest Expense

Noninterest expense totaled $9,656,000 in the second quarter of 2016, compared to $11,642,000 in the second quarter of 2015, a decrease of $1,986,000 or 17.1%.     

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The major driver of the decrease was nonrecurring merger related expenses, from the January 2015 MainStreet acquisition, which accounted for $1,502,000 or 75.6% of the decrease.

Salaries expense was down $277,000 or 6.4% for the second quarter of 2016 compared to the comparable period. This mostly related to a reduction in the number of full time equivalent employees to 302 from 322.

About American National

American National is a multi-state bank holding company with total assets of approximately $1.6 billion. Headquartered in Danville, Virginia, American National is the parent company of American National Bank and Trust Company. American National Bank is a community bank serving Virginia and North Carolina with 25 banking offices and two loan production offices. American National Bank also manages an additional $761 million of trust, investment and brokerage assets in its Trust and Investment Services Division. Additional information about the company and the bank is available on the bank's website at www.amnb.com.

Shares of American National are traded on the NASDAQ Global Select Market under the symbol "AMNB."

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of federal securities laws. Certain of the statements involve significant risks and uncertainties. The statements herein are based on certain assumptions and analyses by American National and are factors it believes are appropriate in the circumstances. Actual results could differ materially from those contained in or implied by such statements for a variety of reasons including, but not limited to: changes in interest rates; changes in accounting principles, policies or guidelines; significant changes in the economic scenario; significant changes in regulatory requirements; significant changes in securities markets; and changes in technology and information security; and changes regarding acquisitions and dispositions. Consequently, all forward-looking statements made herein are qualified by these cautionary statements and the cautionary language in American National's most recent Form 10-K report and other documents filed with the Securities and

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Exchange Commission. American National does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.

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EX-99.2

American National Bankshares Inc.
Consolidated Balance Sheets
(Dollars in thousands, except share and per share data)
Unaudited
	June 30			June 30
ASSETS	2016			2015
Cash and due from banks	$	21,625		$	24,548
Interest-bearing deposits in other banks	51,716			50,758
Federal funds sold	—			408
Securities available for sale, at fair value	362,800			355,595
Restricted stock, at cost	5,362			5,329
Loans held for sale	4,692			2,720
Loans	1,057,959			982,905
Less allowance for loan losses	(12,674		)	(12,793		)
Net Loans	1,045,285			970,112
Premises and equipment, net	22,878			24,182
Other real estate owned, net	1,289			2,113
Goodwill	43,872			44,210
Core deposit intangibles, net	2,107			3,283
Bank owned life insurance	17,885			17,376
Accrued interest receivable and other assets	22,140			23,722
Total assets	$	1,601,651		$	1,524,356
Liabilities
Demand deposits -- noninterest-bearing	$	321,442		$	294,342
Demand deposits -- interest-bearing	205,440			239,582
Money market deposits	252,118			190,799
Savings deposits	116,047			109,732
Time deposits	403,338			399,563
Total deposits	1,298,385			1,234,018
Customer repurchase agreements	53,369			50,123
Long-term borrowings	9,969			9,947
Junior subordinated debt	27,673			27,571
Accrued interest payable and other liabilities	9,551			7,814
Total liabilities	1,398,947			1,329,473
Shareholders' equity
Preferred stock, $5 par, 2,000,000 shares authorized,
none outstanding	—			—
Common stock, $1 par, 20,000,000 shares authorized,
8,609,160 shares outstanding at June 30, 2016 and
8,688,480 shares outstanding at June 30, 2015	8,572			8,671
Capital in excess of par value	74,753			76,826
Retained earnings	115,648			106,984
Accumulated other comprehensive income, net	3,731			2,402
Total shareholders' equity	202,704			194,883
Total liabilities and shareholders' equity	$	1,601,651		$	1,524,356

American National Bankshares Inc.
Consolidated Statements of Income
(Dollars in thousands, except share and per share data)
Unaudited
	Three Months Ended				Six Months Ended
	June 30				June 30
	2016		2015		2016		2015
Interest and Dividend Income:
Interest and fees on loans	$	11,642	$	11,767	$	23,757	$	23,537
Interest on federal funds sold	—		1		—		5
Interest and dividends on securities:
Taxable	1,150		994		2,234		1,969
Tax-exempt	817		940		1,640		1,900
Dividends	93		85		184		167
Other interest income	67		50		125		98
Total interest and dividend income	13,769		13,837		27,940		27,676
Interest Expense:
Interest on deposits	1,314		1,184		2,611		2,378
Interest on short-term borrowings	1		2		2		5
Interest on long-term borrowings	81		81		162		161
Interest on junior subordinated debt	213		188		421		372
Total interest expense	1,609		1,455		3,196		2,916
Net Interest Income	12,160		12,382		24,744		24,760
Provision for loan losses	50		100		100		700
Net Interest Income After Provision for Loan Losses	12,110		12,282		24,644		24,060
Noninterest Income:
Trust fees	961		1,005		1,891		1,957
Service charges on deposit accounts	514		525		1,006		1,022
Other fees and commissions	656		607		1,328		1,195
Mortgage banking income	365		389		657		611
Securities gains, net	222		237		588		547
Brokerage fees	223		211		427		426
Income from Small Business Investment Companies	72		94		238		328
Other	354		190		529		328
Total noninterest income	3,367		3,258		6,664		6,414
Noninterest Expense:
Salaries	4,031		4,308		8,246		8,455
Employee benefits	1,055		1,111		2,169		2,186
Occupancy and equipment	1,059		1,024		2,158		2,196
FDIC assessment	193		195		381		380
Bank franchise tax	256		220		512		455
Core deposit intangible amortization	288		300		576		601
Data processing	459		483		903		945
Software	274		277		571		560
Other real estate owned, net	76		133		209		186
Merger related expenses	—		1,502		—		1,861
Other	1,965		2,089		3,849		3,864
Total noninterest expense	9,656		11,642		19,574		21,689

Income Before Income Taxes	5,821		3,898		11,734		8,785
Income Taxes	1,733		1,018		3,518		2,390
Net Income	$	4,088	$	2,880	$	8,216	$	6,395
Net Income Per Common Share:
Basic	$	0.47	$	0.33	$	0.95	$	0.73
Diluted	$	0.47	$	0.33	$	0.95	$	0.73
Weighted Average Common Shares Outstanding:
Basic	8,610,156		8,707,504		8,610,998		8,713,528
Diluted	8,619,833		8,715,934		8,616,873		8,722,266

American National Bankshares Inc.
Financial Highlights
	(In thousands, except share, ratio and
	nonfinancial data, unaudited)	2nd Qtr			1st Qtr			2nd Qtr			YTD			YTD
		2016			2016			2015			2016			2015
EARNINGS
Interest income		$	13,769		$	14,171		$	13,837		$	27,940		$	27,676
Interest expense		1,609			1,587			1,455			3,196			2,916
Net interest income		12,160			12,584			12,382			24,744			24,760
Provision for loan losses		50			50			100			100			700
Noninterest income		3,367			3,297			3,258			6,664			6,414
Noninterest expense		9,656			9,918			11,642			19,574			21,689
Income taxes		1,733			1,785			1,018			3,518			2,390
Net income		4,088			4,128			2,880			8,216			6,395
PER COMMON SHARE
Income per share - basic		$	0.47		$	0.48		$	0.33		$	0.95		$	0.73
Income per share - diluted		0.47			0.48			0.33			0.95			0.73
Cash dividends paid		0.24			0.24			0.23			0.48			0.46
Book value per share		23.54			23.27			22.43			23.54			22.43
Book value per share - tangible (a)		18.20			17.90			16.96			18.20			16.96
Closing market price		25.18			25.33			23.81			25.18			23.81
FINANCIAL RATIOS
Return on average assets		1.03		%	1.06		%	0.75		%	1.05		%	0.84		%
Return on average equity		8.11			8.28			5.86			8.19			6.51
Return on average tangible equity (b)		10.99			11.27			8.26			11.13			9.14
Average equity to average assets		12.67			12.86			12.85			12.76			12.88
Tangible equity to tangible assets (a)		10.07			10.04			9.98			10.07			9.98
Net interest margin, taxable equivalent		3.45			3.67			3.69			3.56			3.71
Efficiency ratio (c)		60.91			61.36			72.76			61.14			68.36
Effective tax rate		29.77			30.19			26.12			29.98			27.21
PERIOD-END BALANCES
Securities		$	368,162		$	362,353		$	361,176		$	368,162		$	361,176
Loans held for sale		4,692			785			2,720			4,692			2,720
Loans, net of unearned income		1,057,959			1,034,564			982,905			1,057,959			982,905
Goodwill and other intangibles		45,979			46,267			47,493			45,979			47,493
Assets		1,601,651			1,582,554			1,524,356			1,601,651			1,524,356
Assets - tangible (a)		1,555,672			1,536,287			1,476,863			1,555,672			1,476,863
Deposits		1,298,385			1,292,431			1,234,018			1,298,385			1,234,018
Customer repurchase agreements		53,369			42,184			50,123			53,369			50,123
Long-term borrowings		37,642			37,611			37,518			37,642			37,518
Shareholders' equity		202,704			200,443			194,883			202,704			194,883
Shareholders' equity - tangible (a)		156,725			154,176			147,390			156,725			147,390

American National Bankshares Inc.
Financial Highlights
	(In thousands, except share, ratio and
	nonfinancial data, unaudited)	2nd Qtr			1st Qtr			2nd Qtr			YTD			YTD
		2016			2016			2015			2016			2015
AVERAGE BALANCES
Securities		$	361,064		$	347,290		$	349,813		$	354,038		$	347,816
Loans held for sale		2,087			2,055			2,836			2,071			1,893
Loans, net of unearned income		1,047,993			1,016,696			972,083			1,032,345			963,530
Interest-earning assets		1,464,692			1,424,808			1,397,448			1,444,611			1,390,172
Goodwill and other intangibles		46,150			46,441			47,682			46,296			47,834
Assets		1,592,261			1,551,124			1,530,867			1,571,692			1,524,693
Assets - tangible (a)		1,546,111			1,504,683			1,483,185			1,525,396			1,476,859
Interest-bearing deposits		972,385			950,271			945,931			961,328			942,019
Deposits		1,295,520			1,260,534			1,236,626			1,278,027			1,228,874
Customer repurchase agreements		47,607			44,412			51,417			46,008			52,294
Long-term borrowings		37,624			37,593			37,499			37,609			37,484
Shareholders' equity		201,685			199,525			196,663			200,605			196,376
Shareholders' equity - tangible (a)		155,535			153,084			148,981			154,309			148,542
CAPITAL
Weighted average shares outstanding - basic		8,610,156			8,608,728			8,707,504			8,610,998			8,713,528
Weighted average shares outstanding - diluted		8,619,833			8,613,896			8,715,934			8,616,873			8,722,266
ALLOWANCE FOR LOAN LOSSES
Beginning balance		$	12,675		$	12,601		$	12,844		$	12,601		$	12,427
Provision for loan losses		50			50			100			100			700
Charge-offs		(119		)	(40		)	(321		)	(159		)	(630		)
Recoveries		68			64			170			132			296
Ending balance		$	12,674		$	12,675		$	12,793		$	12,674		$	12,793
LOANS
Construction and land development		$	89,451		$	82,711		$	66,543		$	89,451		$	66,543
Commercial real estate		438,164			427,824			432,315			438,164			432,315
Residential real estate		216,857			222,451			220,778			216,857			220,778
Home equity		107,007			100,019			97,866			107,007			97,866
Commercial and industrial		201,381			196,110			159,015			201,381			159,015
Consumer		5,099			5,449			6,388			5,099			6,388
Total		$	1,057,959		$	1,034,564		$	982,905		$	1,057,959		$	982,905
NONPERFORMING ASSETS AT PERIOD-END
Nonperforming loans:
90 days past due and accruing		—			—			—			—			—
Nonaccrual		3,412			5,276			3,772			3,412			3,772
Other real estate owned		1,289			1,493			2,113			1,289			2,113
Nonperforming assets		$	4,701		$	6,769		$	5,885		$	4,701		$	5,885

American National Bankshares Inc.
Financial Highlights
	(In thousands, except share, ratio and
	nonfinancial data, unaudited)	2nd Qtr			1st Qtr				2nd Qtr			YTD			YTD
		2016			2016				2015			2016			2015
ASSET QUALITY RATIOS
Allowance for loan losses to total loans		1.20		%	1.23			%	1.30		%	1.20		%	1.30		%
Allowance for loan losses to
nonperforming loans		371.45			240.24				339.16			371.45			339.16
Nonperforming assets to total assets		0.29			0.43				0.39			0.29			0.39
Nonperforming loans to total loans		0.32			0.51				0.38			0.32			0.38
Annualized net charge-offs (recoveries)
to average loans		0.02			(0.01		)		0.06			0.01			0.07
OTHER DATA
Fiduciary assets at period-end (d) (e)		$	491,517		$	491,257			$	509,289		$	491,517		$	509,289
Retail brokerage assets at period-end (d) (e)		$	269,066		$	268,542			$	257,306		$	269,066		$	257,306
Number full-time equivalent employees (f)		302			301				322			302			322
Number of full service offices		25			25				27			25			27
Number of loan production offices		2			2				2			2			2
Number of ATM's		33			33				34			33			34
Notes:
(a) - Excludes goodwill and other intangible assets.
(b) - Excludes amortization expense, net of tax, of intangible assets.
(c) - The efficiency ratio is calculated by dividing noninterest expense excluding gains or losses on the sale of OREO by
net interest income including tax equivalent income on nontaxable loans and securities and noninterest income and
excluding (i) gains or losses on securities and (ii) gains or losses on sale of premises and equipment.
(d) - Market value.
(e) - Assets are not owned by the Company and are not reflected in the consolidated balance sheet.
(f) - Average for quarter.

			Net Interest Income Analysis
			For the Three Months Ended June 30, 2016 and 2015
			(in thousands, except yields/rates)
								Interest
				Average Balance				Income/Expense				Yield/Rate
				2016		2015		2016		2015		2016		2015
Loans:
	Commercial			$	200,000	$	155,752	$	1,976	$	1,760	3.97	%	4.53	%
	Real estate			844,914		807,605		9,591		9,841		4.54		4.87
	Consumer			5,166		11,562		140		205		10.90		7.11
		Total loans		1,050,080		974,919		11,707		11,806		4.46		4.85
Securities:
	Federal agencies & GSEs			100,205		86,815		446		324		1.78		1.49
	Mortgage-backed & CMOs			81,379		61,738		425		334		2.09		2.16
	State and municipal			164,788		185,848		1,472		1,720		3.57		3.70
	Other			14,692		15,412		130		125		3.54		3.24
		Total securities		361,064		349,813		2,473		2,503		2.74		2.86
Federal funds sold				—		6,480		—		1		—		0.06
Deposits in other banks				53,548		66,236		66		50		0.50		0.30
	Total interest-earning assets			1,464,692		1,397,448		14,246		14,360		3.89		4.11
Non-earning assets				127,569		133,419
		Total assets		$	1,592,261	$	1,530,867
Deposits:
	Demand			$	229,639	$	237,102	43		22		0.08		0.04
	Money market			221,508		195,578		91		61		0.17		0.13
	Savings			117,408		109,397		14		14		0.05		0.05
	Time			403,830		403,854		1,166		1,087		1.16		1.08
		Total deposits		972,385		945,931		1,314		1,184		0.54		0.50
Customer repurchase agreements				47,607		51,417		1		2		0.01		0.02
Long-term borrowings				37,624		37,499		294		269		3.13		2.87
	Total interest-bearing liabilities			1,057,616		1,034,847		1,609		1,455		0.61		0.56
Noninterest bearing demand deposits				323,135		290,695
Other liabilities				9,825		8,662
Shareholders' equity				201,685		196,663
		Total liabilities and
			shareholders' equity	$	1,592,261	$	1,530,867
Interest rate spread												3.28	%	3.55	%
Net interest margin												3.45	%	3.69	%
Net interest income (taxable equivalent basis)								12,637		12,905
Less: Taxable equivalent adjustment								478		523
Net interest income								$	12,159	$	12,382

			Net Interest Income Analysis
			For the Six Months Ended June 30, 2016 and 2015
			(in thousands, except yields/rates)
								Interest
				Average Balance				Income/Expense				Yield/Rate
				2016		2015		2016		2015		2016		2015
Loans:
	Commercial			$	194,137	$	147,482	$	3,830	$	3,586	3.99	%	4.90	%
	Real estate			834,943		804,507		19,681		19,560		4.71		4.86
	Consumer			5,336		13,434		371		445		14.06		6.68
		Total loans		1,034,416		965,423		23,882		23,591		4.63		4.89
Securities:
	Federal agencies & GSEs			94,244		80,866		824		569		1.75		1.41
	Mortgage-backed & CMOs			78,635		63,637		825		712		2.10		2.24
	State and municipal			165,349		188,020		2,964		3,483		3.59		3.70
	Other			15,810		15,293		278		248		3.52		3.24
		Total securities		354,038		347,816		4,891		5,012		2.76		2.88
Federal funds sold				—		10,508		—		5		—		0.10
Deposits in other banks				56,157		66,425		125		98		0.45		0.30
	Total interest-earning assets			1,444,611		1,390,172		28,898		28,706		4.01		4.13
Non-earning assets				127,081		134,521
		Total assets		$	1,571,692	$	1,524,693
Deposits:
	Demand			$	230,504	$	224,955	80		40		0.07		0.04
	Money market			213,391		199,236		166		132		0.16		0.13
	Savings			117,529		108,545		28		26		0.05		0.05
	Time			399,904		409,283		2,337		2,180		1.18		1.07
		Total deposits		961,328		942,019		2,611		2,378		0.55		0.51
Customer repurchase agreements				46,008		52,294		2		5		0.01		0.02
Long-term borrowings				37,609		37,484		583		533		3.10		2.84
	Total interest-bearing liabilities			1,044,945		1,031,797		3,196		2,916		0.62		0.57
Noninterest bearing demand deposits				316,699		286,855
Other liabilities				9,443		9,665
Shareholders' equity				200,605		196,376
		Total liabilities and
			shareholders' equity	$	1,571,692	$	1,524,693
Interest rate spread												3.39	%	3.56	%
Net interest margin												3.56	%	3.71	%
Net interest income (taxable equivalent basis)								25,702		25,790
Less: Taxable equivalent adjustment								958		1,030
Net interest income								$	24,744	$	24,760