National Bankshares, Inc. · NASDAQ:NKSH
National Bankshares — Investor Presentation (May 2023)
19 slides from National Bankshares's investor presentation, May 8, 2023
Slide 1: Successfully Executing Strategy to Drive Long-Term Value for All Shareholders
Successfully Executing Strategy to Drive Long-Term Value for All Shareholders TUN National Bankshares National Bankshares Investor Presentation - 15* Quarter 2023
Slide 2: Forward-Looking Statements
Forward-Looking Statements ‘This presentation of National Bankshares, Inc. (the “Company") contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward:-looking statement are subject to significant risks and uncertainties and are based
Slide 3: Non-GAAP Financial Measures
| Non-GAAP Financial Measures This presentation contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The Company's management uses these non-GAAP financial measures in its analysis of the
Slide 4: Q1 2023 Highlights
Q1 2023 Highlights EPS ROAA ROATCE Efficiency Ratio UNADJUSTED” ROY A4 15.6% Ps7.4% | CORE $0.80 1.17% 16.2% 55.0% ¥ Reported net income for the quarter of $4.53 million or $0.77 per common share - core net income of $4.71 million or | $0.80 per commonshare"") ¥ Maintained solid liquidity position w
Slide 5: NKSH at a Glance
| NKSH ata Glance Financial Highlights The National Bank (as of or for the quarter ended 3/31/2023) Bla ur Assets $1.6 billion. TCE/TA” 7.6% @ Branch where Core ROAA) 117% sana teiieciacabicalal ‘Core ROATCE™) 16.2% pad ag Core Efficiency Ratio!) 55.0% ~ ; Market Capitalization Price / 2023E EPS) 9.
Slide 6: Delivering Exceptional Returns to Our Shareholders
Delivering Exceptional Returns to Our Shareholders Financial covid-19 Crisis Pandemic ve Fallout ‘Since January 2000 Pandemic Peakto Trough” Pandemic Peakto Current” 1 j i ' i ' ' ' ' Yer i Source SEPCapn C1) Sue appandinor pee grove dea (Gions:oPandemepeotowaghrepretenspenadrom 2202000% 872820
Slide 7: Consistently Growing Our Dividend
| Consistently Growing Our Dividend 2000 2001 2002 2 5 2006 2007 2008 2009 2010 2011 Special Onidend Source SEPCapiaIOPro
Slide 8: Peer-Leading Efficiency and Profitability
| Peer-Leading Efficiency and Profitability Diluted Earnings Per Share 2022 Efficiency Ratio s03% 433 ani _ a ss = a8 22 | | 2022 Pre-Provision NetRevenue/ Average Assets | LI : KS Selected Peer Soweer: SAPCapialO Pre, Compan Sling Now: ¥iciency so and pre-provsonnetrevence ar calcd per SEP Cain Oro
Slide 9: Dominant Market Share in Our Core Markets
Dominant Market Share in Our Core Markets Branches in Deposits Deposit % of County Market Franchise Montgomery 7 $740 24.6% 46.8% 7 Tazewell 7 260 21.1% 164% {aa cankin Pulaski 3 188 33.1% 11.9% | cook Giles 3 151 60.0% 9.6% Gcuntosaa Wythe 1 138 17.8% 3.8% | representing ' Radford (City) 1 51 13.3%
Slide 10: Deposit Base Well Positioned for Higher Rates
Deposit Base Well Positioned for Higher Rates FV Retail-and small business-oriented deposit base vs Fed Funds?) | ¥ Low deposit beta during last Fed tightening cycle aa | ¥ Limited reliance on ime deposits and wholesale funding et Ares H Peak H Strong liquidity position - increasingly important duri
Slide 11: Responsible Lending Drives Pristine Credit Quality
| Responsible Lending Drives Pristine Credit Quality £Y Conservative underwriting sanders | + No highs lending concentrations | ast £ v No lending to VC/PE industry ¥ Low LTVs and high DSCRs { v Umited exposure to Covid-impacted industries 3/31/2023 Loan Composition e i lidtadidia Sourcer: SAPCapiul
Slide 12: A Safe Haven During Uncertain Times
| A Safe Haven During Uncertain Times "More broadly, NKSH is one of the most consistent performers we cover, with the best deposit base in our universe, a conservative credit posture and clean balance sheet. All of these factors offer offensive and defensive characteristics in a highly uncertain env
Slide 13: Outperforming During Periods of Stress
Outperforming During Periods of Stress a a 47% i _ = SAPUS. eM 20% Ks sete SAPUS. EMI Bans Selected Peera2) TSR: Covid-19 Pandemic Peak to Current®) TSR: Covid-19 Pandemic Peak to Trough”) -_ 7 1 i ° sole sap US Bit Banks SAPUS. EMI Banks it peak woughrepreseta pari rom 1008/2070 3/9200, 2 Se appar
Slide 14: Peer-Leading Capital Levels and Return
Peer-Leading Capital Levels and Return Actual Well Dividend Payout Ratio % NBB at 3/31/2023 Ratio Total Capital 18.00% 10.00% a as Tier 1 Capital 17.00% 8.00% tad Goninon qutyTe't 700% 630m sai ears | i | FV NKSH and NBB possess robust regulatory capital levels, Value of Share Repurchases / Net Inco
Slide 15: Strong Financial Position Provides Optionality
Strong Financial Position Provides Optionality Organic Growth Mergers and ensgeousped new markets offer more growth prospects than legacy Acquisitions mane ¥ Several attractive potential Capital Return ¥ Recently established loan merger partners in and production offices in ‘round our markets New Bu
Slide 16: Appendix
| Appendix
Slide 17: Peer Group Detail
Peer Group Detail NKSH Selected Peers‘) ACNB Corporation First United Corporation ‘American National Banksharesinc. Limestone Bancorp Ameriserv Financial, Inc. Mid Penn Bancorp C&F Financial Corporation (Old Point Financial Corporation Capstar Financial Holdings, Inc. Penns Woods Bancorp, Inc. Codor
Slide 18: Non-GAAP Reconciliations
Non-GAAP Reconciliations As of or forthe peri Total stoctholders' equity (GAAP) Lest: Goodwill “Tangible comman equity (non-GAAP) Tangible assets: Total assets (GAAP) Less: Goodwill “Tangible astets (non-GAAP) Tangible commen equity / tangible assets (TCE/TA): Tangible common equsty (non GAAP) ‘Tang
Slide 19: Non-GAAP Reconciliations
Non-GAAP Reconciliations As of or for the period ended 3/31/20: ‘Unadjusted ROATCE: Net income (GAAP) $4531 Average tangible common equity (non-GAAP) 118,148 ‘Unadjusted ROATCE (non-GAAP) 15.46% Core ROATCE: Core netincome (non-GAAP) $4706 Average tangible common equity(non-GAAP) m1e;148 Core ROATCE
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