EX-99 2 q207_pressrelease.htm

 


 

FOR IMMEDIATE RELEASE

 

CONTACTS:

James G. Rakes, Chairman, President & CEO (540) 951-6236

 

J. Robert Buchanan, Treasurer (276) 979-0341

 

 

NATIONAL BANKSHARES, INC.

REPORTS SECOND QUARTER EARNINGS

 

BLACKSBURG, VA, JULY 19, 2007: National Bankshares, Inc. (NASDAQ Capital Market: NKSH) posted year-to-date net income of nearly $6.26 million on June 30, 2007, an increase over the $6.23 million earned at the end of the second quarter in 2006. Net income earned in the second quarter this year was $3.14 million, slightly behind the $3.23 million reported in the same period last year. These earnings figures translate to 2007 year-to-date basic net income per share of $0.90, as compared with $0.89 last year. Total assets at June 30 were nearly $877.10 million, up by 3.99% over total assets of $843.41 million on June 30, 2006. In a competitive loan market, total loans grew from $490.16 million at the same time last year to $503.12 million at the end of June 2007.

 

National Bankshares’ Chairman, President & CEO James G. Rakes commented, “The Company has been able to compensate for the continued effects of compression in the net interest margin in three ways. First, the quality of the loan portfolio remains very good, so contributions to the provision for loan losses have been minimal. Second, noninterest income is up by 3.9% over last year. Finally, the May 2006 merger of our two subsidiary banks has produced savings in several expense categories, and total noninterest expense has declined from $10.90 million at June 30 last year to $10.76 million at the same point this year.” Mr. Rakes added, “We believe that National Bankshares’ history of profitability, together with our practice of sharing those profits with our stockholders in the form of fair dividends, will serve the Company and its stockholders well over time.”

 

National Bankshares, Inc. is the parent company of National Bank, a 117 year-old community bank that operates from 26 offices throughout Southwest Virginia. The Company, which is headquartered in Blacksburg, Virginia, also has a non-bank subsidiary, National Bankshares Financial Services, Inc. which offers insurance and investment products. National Bankshares, Inc. stock trades on the NASDAQ Stock Market under the symbol “NKSH”. Additional information is available on the Company’s web site at www.nationalbankshares.com.

 

(unaudited tables follow)

 

101 Hubbard Street / Blacksburg, Virginia 24060

P.O. Box 90002 / Blacksburg, Virginia 24062-9002

540 951-6300 / 800 552-4123

www.nationalbankshares.com

 

National Bankshares, Inc. And Subsidiaries

(000’s), except ratios and percent data

 

Three months ending

 

June 30, 2007

 

June 30, 2006

 

Change

 

 

 

 

 

 

 

 

 

Selected Consolidated Data :

 

 

 

 

 

 

 

Interest income

 

$

12,695

 

$

11,849

 

7.14

%

Interest expense

 

 

5,370

 

 

4,374

 

22.77

%

Net interest income

 

 

7,325

 

 

7,475

 

-2.01

%

Provision for loan losses

 

 

13

 

 

7

 

85.71

%

Trust income

 

 

360

 

 

365

 

-1.37

%

Other noninterest income

 

 

1,899

 

 

1,847

 

2.82

%

Salary and benefits

 

 

2,778

 

 

2,929

 

-5.16

%

Occupancy expense

 

 

412

 

 

472

 

-12.71

%

Amortization of intangibles

 

 

285

 

 

285

 

0.00

%

Other noninterest expense

 

 

2,029

 

 

1,715

 

18.31

%

Income taxes

 

 

-927

 

 

-1,052

 

-11.88

%

Net income

 

$

3,140

 

$

3,227

 

-2.70

%

Basic net income per share

 

$

0.45

 

$

0.46

$

0.01

 

 

 

 

 

 

 

 

 

 

 

Daily averages:

 

 

 

 

 

 

 

 

 

Gross loans

 

$

509,826

 

$

494,387

 

3.12

%

Loans,net

 

 

503,706

 

 

488,039

 

3.21

%

Total securities

 

 

288,215

 

 

271,677

 

6.09

%

Total deposits

 

 

756,952

 

 

738,669

 

2.48

%

Other borrowings

 

 

2,235

 

 

753

 

196.81

%

Stockholders’ equity

 

 

101,105

 

 

90,113

 

12.20

%

Cash and due from

 

 

14,213

 

 

15,830

 

-10.21

%

Interest-earning assets

 

 

806,828

 

 

774,594

 

4.16

%

Interest-bearing liabilities

 

 

648,844

 

 

625,375

 

3.75

%

Intangible assets

 

 

15,569

 

 

16,640

 

-6.44

%

Total assets

 

 

866,915

 

 

834,745

 

3.85

%

 

 

 

 

 

 

 

 

 

 

Financial ratios: Note (1)

 

 

 

 

 

 

 

 

 

Return on average assets

 

 

1.45

%

 

1.57

%

-0.12

 

Return on average equity

 

 

12.46

%

 

14.52

%

-2.06

 

Net interest margin

 

 

4.03

%

 

4.30

%

-0.27

 

Average equity to average assets

 

 

11.66

%

 

10.80

%

0.87

 

Note (1) Ratio change measured in bp

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for loan losses:

 

 

 

 

 

 

 

 

 

Beginning balance

 

$

5,045

 

$

5,418

 

-6.88

%

Provision for losses

 

 

13

 

 

7

 

85.71

%

Charge-offs

 

 

-89

 

 

-122

 

-27.05

%

Recoveries

 

 

31

 

 

37

 

-16.22

%

Ending balance

 

$

5,000

 

$

5,340

 

-6.37

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year to Date

 

 

June 30, 2007

 

 

June 30, 2006

 

Change

 

 

 

 

 

 

 

 

 

 

 

Selected Consolidated Data :

 

 

 

 

 

 

 

 

 

Interest income

 

$

25,225

 

$

23,432

 

7.65

%

Interest expense

 

 

10,786

 

 

8,612

 

25.24

%

Net interest income

 

 

14,439

 

 

14,820

 

-2.57

%

Provision for loan losses

 

 

10

 

 

24

 

-58.33

%

Trust income

 

 

733

 

 

745

 

-1.61

%

Other noninterest income

 

 

3,705

 

 

3,526

 

5.08

%

Salary and benefits

 

 

5,619

 

 

5,840

 

-3.78

%

Occupancy expense

 

 

897

 

 

1,005

 

-10.75

%

Amortization of intangibles

 

 

569

 

 

569

 

0.00

%

Other noninterest expense

 

 

3,676

 

 

3,486

 

5.45

%

Income taxes

 

 

-1,850

 

 

-1,937

 

-4.49

%

Net income

 

$

6,256

 

$

6,230

 

0.42

%

Basic net income per share

 

$

0.90

 

$

0.89

$

0.01

 

Fully diluted net income per share

 

$

0.89

 

$

0.89

$

0.00

 

Dividends per share

 

 

0

 

 

0

$

0.00

 

Dividend payout ratio

 

 

41.30

 

 

40.53

$

0.77

 

Book value per share

 

$

14.14

 

 

13.29

$

0.85

 

 

 

 

 

 

 

 

 

 

 

Balance sheet at period-end:

 

 

 

 

 

 

 

 

 

Gross loans

 

$

509,232

 

$

496,476

 

2.57

%

Loans, net

 

$

503,118

 

$

490,160

 

2.64

%

Total securities

 

 

282,955

 

 

267,677

 

5.71

%

Cash and due From

 

 

16,934

 

 

19,037

 

-11.05

%

Total deposits

 

 

771,316

 

 

746,581

 

3.31

%

Other borrowings

 

 

141

 

 

78

 

80.77

%

Stockholders’ equity

 

 

98,674

 

 

93,173

 

5.90

%

Intangible assets

 

 

15,407

 

 

16,544

 

-6.87

%

Total assets

 

 

877,095

 

 

843,407

 

3.99

%

 

 

 

 

 

 

 

 

 

 

Daily averages:

 

 

 

 

 

 

 

 

 

Gross loans

 

$

506,452

 

$

492,905

 

2.75

%

Loans,net

 

 

500,292

 

 

486,541

 

2.83

%

Total securities

 

 

286,073

 

 

272,151

 

5.12

%

Total deposits

 

 

759,874

 

 

740,298

 

2.64

%

Other borrowings

 

 

1,160

 

 

772

 

50.26

%

Stockholders’ equity

 

 

99,086

 

 

91,754

 

7.99

%

Cash and due from

 

 

14,453

 

 

16,493

 

-12.37

%

Interest-earning assets

 

 

806,790

 

 

776,117

 

3.95

%

Interest-bearing liabilities

 

 

654,345

 

 

627,882

 

4.21

%

Intangible assets

 

 

15,714

 

 

16,734

 

-6.10

%

Total assets

 

 

867,003

 

 

837,315

 

3.55

%

 

 

 

 

 

 

 

 

 

 

Financial ratios: Note (1)

 

 

 

 

 

 

 

 

 

Return on average assets

 

 

1.46

%

 

1.50

%

-0.04

 

Return on average equity

 

 

12.73

%

 

13.69

%

-0.96

 

Net interest margin

 

 

4.00

%

 

4.22

%

-0.22

 

 

 

 

Efficiency ratio

 

 

52.55

%

 

52.96

%

-0.41

 

Average equity to average assets

 

 

11.43

%

 

10.96

%

0.47

 

Note (1) Ratio change measured in bp

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for loan losses:

 

 

 

 

 

 

 

 

 

Beginning balance

 

$

5,157

 

$

5,449

 

-5.36

%

Provision for losses

 

 

10

 

 

24

 

-58.33

%

Charge-offs

 

 

-225

 

 

-209

 

7.66

%

Recoveries

 

 

58

 

 

76

 

-23.68

%

Ending balance

 

$

5,000

 

$

5,340

 

-6.37

%

 

 

 

 

 

 

 

 

 

 

Nonperforming assets:

 

 

 

 

 

 

 

 

 

Nonaccrual loans

 

 

1,136

 

 

---

 

---

 

Restructured loans

 

 

---

 

 

---

 

---

 

Total nonperforming loans Note (2)

 

 

1,136

 

 

0

 

---

 

Other real estate owned

 

 

306

 

 

390

 

-21.54

%

Total nonperforming assets

 

$

1,442

 

$

390

 

269.74

%

 

 

 

 

 

 

 

 

 

 

Asset quality ratios: Note (3)

 

 

 

 

 

 

 

 

 

Nonperforming loans to total loans

 

 

0.224

%

 

---

 

---

 

Allowance for loan losses to total loans

 

 

0.98

%

 

1.08

%

-9.60

%

Allowance for loan losses to nonperforming loans

 

 

440.14

%

 

---

 

---

 

Note (2) Loans 90 days past due or more not included

 

 

 

 

 

 

 

 

 

Note (3) Ratio change measured in bp