Exhibit 99





                          Independent Auditors' Report



The Board of Directors and Stockholders
National Bankshares, Inc.:

We  have  audited  the  accompanying  consolidated  balance  sheet  of  National
Bankshares,  Inc. and  subsidiaries  as of December  31,  1999,  and the related
consolidated   statements  of  income  and  comprehensive  income,   changes  in
stockholders'  equity,  and cash flows for the years ended December 31, 1999 and
1998. These  consolidated  financial  statements are the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
consolidated financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audit to obtain  reasonable  assurance  about  whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects, the financial position of National Bankshares,
Inc.  and  subsidiaries  as of  December  31,  1999,  and the  results  of their
operations  and their cash flows for the years ended December 31, 1999 and 1998,
in conformity with accounting principles generally accepted in the United States
of America.

As discussed in note 1(T) to the consolidated financial statements,  the Company
adopted the provisions of Statement of Financial  Accounting  Standards No. 133,
Accounting for Derivative  Instruments and Hedging Activities,  as of October 1,
1998.

                                            KPMG LLP


Roanoke, Virginia
February 11, 2000