About National Bankshares
(in thousands, except share and per share data) | March 31, 2025 | December 31, 2024 | March 31, 2024 | |||||||||
Assets | ||||||||||||
Cash and due from banks | $ | 14,892 | $ | 13,564 | $ | 10,656 | ||||||
Interest-bearing deposits | 107,385 | 94,254 | 110,527 | |||||||||
Federal funds sold | 258 | 299 | - | |||||||||
Total cash and cash equivalents | 122,535 | 108,117 | 121,183 | |||||||||
Securities available for sale, at fair value | 596,253 | 601,898 | 609,968 | |||||||||
Restricted stock, at cost | 1,848 | 1,848 | 1,248 | |||||||||
Mortgage loans held for sale | 938 | 619 | - | |||||||||
Loans: | ||||||||||||
Real estate construction loans | 42,942 | 50,798 | 61,486 | |||||||||
Consumer real estate loans | 311,549 | 307,855 | 244,946 | |||||||||
Commercial real estate loans | 497,072 | 478,078 | 414,615 | |||||||||
Commercial non real estate loans | 53,156 | 51,844 | 41,835 | |||||||||
Public sector and IDA loans | 56,981 | 57,171 | 59,742 | |||||||||
Consumer non real estate loans | 42,205 | 42,867 | 41,467 | |||||||||
Total loans | 1,003,905 | 988,613 | 864,091 | |||||||||
Less: deferred fees and costs | (641 | ) | (663 | ) | (543 | ) | ||||||
Loans, net of deferred fees and costs | 1,003,264 | 987,950 | 863,548 | |||||||||
Less: allowance for credit losses | (10,490 | ) | (10,262 | ) | (9,055 | ) | ||||||
Loans, net | 992,774 | 977,688 | 854,493 | |||||||||
Premises and equipment, net | 17,593 | 16,878 | 11,214 | |||||||||
Accrued interest receivable | 6,673 | 6,469 | 6,478 | |||||||||
Goodwill | 10,718 | 10,718 | 5,848 | |||||||||
Core deposit intangible, net | 1,766 | 1,863 | - | |||||||||
Bank-owned life insurance | 47,661 | 47,369 | 43,840 | |||||||||
Other assets | 36,958 | 38,169 | 34,934 | |||||||||
Total assets | $ | 1,835,717 | $ | 1,811,636 | $ | 1,689,206 | ||||||
Liabilities and Stockholders' Equity | ||||||||||||
Noninterest-bearing demand deposits | $ | 301,149 | $ | 290,088 | $ | 283,870 | ||||||
Interest-bearing demand deposits | 879,215 | 864,753 | 838,450 | |||||||||
Savings deposits | 178,737 | 177,297 | 175,587 | |||||||||
Time deposits | 298,659 | 312,614 | 239,901 | |||||||||
Total deposits | 1,657,760 | 1,644,752 | 1,537,808 | |||||||||
Accrued interest payable | 1,434 | 1,462 | 2,514 | |||||||||
Other liabilities | 9,245 | 9,013 | 9,494 | |||||||||
Total liabilities | 1,668,439 | 1,655,227 | 1,549,816 | |||||||||
Commitments and contingencies | ||||||||||||
Stockholders' Equity | ||||||||||||
Preferred stock, no par value, 5,000,000 shares authorized; none issued and outstanding | $ | - | $ | - | $ | - | ||||||
Common stock of $1.25 par value and additional paid in capital. Authorized 10,000,000 shares; issued and outstanding 6,363,371 (including 4,961 unvested) shares at March 31, 2025, 6,363,371 (including 4,961 unvested) shares at December 31, 2024, and 5,893,782 (including 4,095 unvested) shares at March 31, 2024 | 21,874 | 21,831 | 7,436 | |||||||||
Retained earnings | 199,579 | 196,343 | 200,158 | |||||||||
Accumulated other comprehensive loss, net | (54,175 | ) | (61,765 | ) | (68,204 | ) | ||||||
Total stockholders' equity | 167,278 | 156,409 | 139,390 | |||||||||
Total liabilities and stockholders' equity | $ | 1,835,717 | $ | 1,811,636 | $ | 1,689,206 | ||||||
Three Months Ended | ||||||||||||
(in thousands, except share and per share data) | March 31, 2025 | December 31, 2024 | March 31, 2024 | |||||||||
Interest Income | ||||||||||||
Interest and fees on loans | $ | 12,942 | $ | 13,142 | $ | 10,277 | ||||||
Interest on federal funds sold | 3 | 3 | - | |||||||||
Interest on interest-bearing deposits | 1,039 | 758 | 1,129 | |||||||||
Interest on securities - taxable | 3,883 | 4,079 | 4,276 | |||||||||
Interest on securities - nontaxable | 336 | 335 | 339 | |||||||||
Total interest income | 18,203 | 18,317 | 16,021 | |||||||||
Interest Expense | ||||||||||||
Interest on time deposits | 3,145 | 3,390 | 2,552 | |||||||||
Interest on other deposits | 4,802 | 4,923 | 5,224 | |||||||||
Total interest expense | 7,947 | 8,313 | 7,776 | |||||||||
Net interest income | 10,256 | 10,004 | 8,245 | |||||||||
Provision for (recovery of) credit losses | 276 | (60 | ) | (10 | ) | |||||||
Net interest income after provision for (recovery of) credit losses | 9,980 | 10,064 | 8,255 | |||||||||
Noninterest Income | ||||||||||||
Service charges on deposit accounts | 736 | 748 | 675 | |||||||||
Other service charges and fees | 63 | 53 | 46 | |||||||||
Credit and debit card fees, net | 417 | 307 | 374 | |||||||||
Trust income | 579 | 581 | 503 | |||||||||
BOLI income | 292 | 298 | 258 | |||||||||
Gain on sale of mortgage loans | 25 | 36 | 24 | |||||||||
Other income | 443 | 220 | 319 | |||||||||
Total noninterest income | 2,555 | 2,243 | 2,199 | |||||||||
Noninterest Expense | ||||||||||||
Salaries and employee benefits | 5,188 | 5,108 | 4,466 | |||||||||
Occupancy, furniture and fixtures | 656 | 598 | 539 | |||||||||
Data processing and ATM | 1,078 | 1,116 | 867 | |||||||||
FDIC assessment | 207 | 222 | 187 | |||||||||
Intangible asset amortization | 97 | 100 | - | |||||||||
Franchise taxes | 373 | 373 | 350 | |||||||||
Professional services | 299 | 285 | 240 | |||||||||
Merger-related expense | - | 25 | 484 | |||||||||
Conversion expense | 46 | - | - | |||||||||
Other operating expenses | 689 | 793 | 629 | |||||||||
Total noninterest expense | 8,633 | 8,620 | 7,762 | |||||||||
Income before income tax expense | 3,902 | 3,687 | 2,692 | |||||||||
Income tax expense | 666 | 608 | 518 | |||||||||
Net Income | $ | 3,236 | $ | 3,079 | $ | 2,174 | ||||||
Basic net income per common share | $ | 0.51 | $ | 0.48 | $ | 0.37 | ||||||
Diluted net income per common share | $ | 0.51 | $ | 0.48 | $ | 0.37 | ||||||
Weighted average number of common shares outstanding, basic | 6,358,410 | 6,356,949 | 5,889,687 | |||||||||
Weighted average number of common shares outstanding, diluted | 6,360,392 | 6,359,506 | 5,891,651 | |||||||||
Dividends declared per common share | $ | - | $ | 0.78 | $ | - | ||||||
Book value per common share | $ | 26.29 | $ | 24.58 | $ | 23.67 | ||||||
Three Months Ended March 31, 2025 | Three Months Ended December 31, 2024 | ||||||||||||||||||||||||
(in thousands) | Average | Interest | Average | Average | Interest | Average | |||||||||||||||||||
Interest-earning assets: | |||||||||||||||||||||||||
Loans (1)(2)(3) | $ | 995,049 | $ | 13,060 | 5.32 | % | $ | 995,259 | $ | 13,261 | 5.30 | % | |||||||||||||
Taxable securities (4)(5) | 615,788 | 3,883 | 2.56 | % | 621,424 | 4,079 | 2.61 | % | |||||||||||||||||
Nontaxable securities (1)(4) | 62,964 | 456 | 2.94 | % | 63,079 | 455 | 2.87 | % | |||||||||||||||||
Federal funds sold | 261 | 3 | 4.66 | % | 294 | 3 | 4.06 | % | |||||||||||||||||
Interest-bearing deposits | 94,431 | 1,039 | 4.46 | % | 63,028 | 758 | 4.78 | % | |||||||||||||||||
Total interest-earning assets | $ | 1,768,493 | $ | 18,441 | 4.23 | % | $ | 1,743,084 | $ | 18,556 | 4.24 | % | |||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 871,007 | $ | 4,583 | 2.13 | % | $ | 836,486 | $ | 4,698 | 2.23 | % | |||||||||||||
Savings deposits | 177,981 | 219 | 0.50 | % | 177,040 | 225 | 0.51 | % | |||||||||||||||||
Time deposits | 307,328 | 3,145 | 4.15 | % | 308,979 | 3,390 | 4.36 | % | |||||||||||||||||
Total interest-bearing liabilities | $ | 1,356,316 | $ | 7,947 | 2.38 | % | $ | 1,322,505 | $ | 8,313 | 2.50 | % | |||||||||||||
Net interest income and interest rate spread | $ | 10,494 | 1.85 | % | $ | 10,243 | 1.74 | % | |||||||||||||||||
Net interest margin | 2.41 | % | 2.34 | % | |||||||||||||||||||||
Three Months Ended March 31, 2024 | ||||||||||||
(in thousands) | Average | Interest | Average | |||||||||
Interest-earning assets: | ||||||||||||
Loans (1)(2)(3) | $ | 858,291 | $ | 10,400 | 4.87 | % | ||||||
Taxable securities (4)(5) | 633,510 | 4,276 | 2.71 | % | ||||||||
Nontaxable securities (1)(4) | 64,179 | 460 | 2.88 | % | ||||||||
Interest-bearing deposits | 82,724 | 1,129 | 5.49 | % | ||||||||
Total interest-earning assets | $ | 1,638,704 | $ | 16,265 | 3.99 | % | ||||||
Interest-bearing liabilities: | ||||||||||||
Interest-bearing demand deposits | $ | 822,555 | $ | 4,989 | 2.44 | % | ||||||
Savings deposits | 175,949 | 235 | 0.54 | % | ||||||||
Time deposits | 234,670 | 2,552 | 4.37 | % | ||||||||
Total interest-bearing liabilities | $ | 1,233,174 | $ | 7,776 | 2.54 | % | ||||||
Net interest income and interest rate spread | $ | 8,489 | 1.45 | % | ||||||||
Net interest margin | 2.08 | % | ||||||||||
(1) Interest on nontaxable loans and securities is computed on a fully taxable equivalent basis using a federal income tax rate of 21%. See "Reconciliation of Non-GAAP Financial Measures" at the end of this release.
(2) Interest income includes loan fees of $68, $53 and $48 for the three months ended March 31, 2025, December 31, 2024 and March 31, 2024, respectively.
(3) Includes loans held for sale and nonaccrual loans.
(4) Daily averages are shown at amortized cost.
(5) Includes restricted stock.
National Bankshares, Inc.
As of and for the Three Months Ended | ||||||||||||
(in thousands) | March 31, 2025 | December 31, 2024 | March 31, 2024 | |||||||||
Average Balances | ||||||||||||
Cash and due from banks | $ | 13,504 | $ | 13,937 | $ | 11,898 | ||||||
Interest-bearing deposits | 94,431 | 63,028 | 82,724 | |||||||||
Securities available for sale, at fair value | 602,794 | 612,680 | 614,210 | |||||||||
Mortgage loans held for sale | 147 | 197 | 154 | |||||||||
Loans, gross | 995,539 | 995,669 | 858,658 | |||||||||
Loans, net of deferred fees and costs | 994,902 | 995,062 | 858,137 | |||||||||
Loans, net of allowance for credit losses | 984,665 | 984,725 | 849,075 | |||||||||
Intangible assets | 12,542 | 12,643 | 5,848 | |||||||||
Total assets | 1,819,747 | 1,796,684 | 1,660,253 | |||||||||
Noninterest-bearing demand deposits | $ | 291,234 | $ | 300,148 | $ | 279,232 | ||||||
Interest-bearing demand and savings deposits | 1,048,988 | 1,013,526 | 998,504 | |||||||||
Time deposits | 307,328 | 308,979 | 234,670 | |||||||||
Total deposits | 1,647,550 | 1,622,653 | 1,512,406 | |||||||||
Total stockholders' equity | 161,133 | 159,476 | 136,039 | |||||||||
Financial Ratios | ||||||||||||
Return on average assets(1) | 0.69 | % | 0.68 | % | 0.59 | % | ||||||
Return on average equity(1) | 7.84 | % | 7.63 | % | 7.19 | % | ||||||
Efficiency ratio(2) | 65.81 | % | 68.84 | % | 68.10 | % | ||||||
Average equity to average assets | 8.85 | % | 8.88 | % | 8.19 | % | ||||||
Tangible common equity to tangible assets(3) | 8.49 | % | 7.99 | % | 7.93 | % | ||||||
Allowance for Loan Credit Losses | ||||||||||||
Beginning balance | $ | 10,262 | $ | 10,328 | $ | 9,094 | ||||||
Provision for (recovery of) credit losses | 277 | (70 | ) | 5 | ||||||||
Charge-offs | (112 | ) | (108 | ) | (109 | ) | ||||||
Recoveries | 63 | 112 | 65 | |||||||||
Ending Balance | $ | 10,490 | $ | 10,262 | $ | 9,055 | ||||||
(1) The return on average assets and return on average equity are calculated by annualizing net income and dividing by average period-to-date assets or equity, respectively. Any significant nonrecurring items within net income are not annualized. See "Reconciliation of Non-GAAP Financial Measures" at the end of this release.
(2) The efficiency ratio is calculated as noninterest expense divided by the sum of noninterest income and net interest income on a fully taxable equivalent basis. Noninterest income and noninterest expense are adjusted for any non-recurring items. See "Reconciliation of Non-GAAP Financial Measures" at the end of this release.
(3) Tangible common equity and tangible assets exclude goodwill and intangible assets of $12,484 as of March 31, 2025, $12,581 as of December 31, 2024 and $5,848 as of March 31, 2024. See "Reconciliation of Non-GAAP Financial Measures" at the end of this release.
National Bankshares, Inc.(in thousands) | March 31, 2025 | December 31, 2024 | March 31, 2024 | |||||||||
Nonperforming Assets | ||||||||||||
Nonaccrual loans | $ | 2,173 | $ | 2,222 | $ | 2,591 | ||||||
Loans past due 90 days or more, and still accruing | $ | 166 | $ | 548 | $ | 162 | ||||||
Asset Quality Ratios | ||||||||||||
Ratio of nonperforming loans to total loans(1) | 0.22 | % | 0.22 | % | 0.30 | % | ||||||
Allowance for credit losses on loans to total loans(1) | 1.05 | % | 1.04 | % | 1.05 | % | ||||||
Ratio of ACLL to nonperforming loans | 482.74 | % | 461.84 | % | 349.48 | % | ||||||
Loans past due 90 days or more to total loans (1) | 0.02 | % | 0.06 | % | 0.02 | % | ||||||
(1) Loans are net of deferred fees and costs.
National Bankshares, Inc.
In addition to financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP"), the Company uses certain non-GAAP financial measures that provide useful information for financial and operational decision making, evaluating trends, and comparing financial results to other financial institutions. Non-GAAP financial measures are supplemental and not a substitute for, or more important than, financial measures prepared in accordance with GAAP and may not be comparable to those reported by other financial institutions.
The non-GAAP financial measures presented in this document include fully taxable equivalent ("FTE") interest income used in the net interest margin, the efficiency ratio, and the ratio of tangible common equity to tangible assets. For periods that are shorter than twelve months, the Company annualizes net income for the return on average assets and return on average equity. In order to prevent distortion, the Company does not annualize significant non-recurring income and expense items.
The following tables present calculations underlying non-GAAP financial measures. All dollars are in thousands.
Three Months Ended | ||||||||||||
Net Interest Margin, FTE | March 31, 2025 | December 31, 2024 | March 31, 2024 | |||||||||
Interest income (GAAP) | $ | 18,203 | $ | 18,317 | $ | 16,021 | ||||||
Add: FTE adjustment | 238 | 239 | 244 | |||||||||
Interest income, FTE (non-GAAP) | 18,441 | 18,556 | 16,265 | |||||||||
Interest expense (GAAP) | 7,947 | 8,313 | 7,776 | |||||||||
Net interest income, FTE (non-GAAP) | $ | 10,494 | $ | 10,243 | $ | 8,489 | ||||||
Average balance of interest-earning assets | $ | 1,768,493 | $ | 1,743,084 | $ | 1,638,704 | ||||||
Net interest margin (non-GAAP) | 2.41 | % | 2.34 | % | 2.08 | % | ||||||
Three Months Ended | ||||||||||||
Efficiency Ratio | March 31, 2025 | December 31, 2024 | March 31, 2024 | |||||||||
Noninterest expense (GAAP) | $ | 8,633 | $ | 8,620 | $ | 7,762 | ||||||
Less: merger-related expense | - | (25 | ) | (484 | ) | |||||||
Less: conversion expense (1) | (46 | ) | - | - | ||||||||
Adjusted noninterest expense (non-GAAP) | $ | 8,587 | $ | 8,595 | $ | 7,278 | ||||||
Noninterest income (GAAP) | $ | 2,555 | $ | 2,243 | $ | 2,199 | ||||||
Net interest income, FTE (non-GAAP) | 10,494 | 10,243 | 8,489 | |||||||||
Total income for efficiency ratio (non-GAAP) | $ | 13,049 | $ | 12,486 | $ | 10,688 | ||||||
Efficiency ratio (non-GAAP) | 65.81 | % | 68.84 | % | 68.10 | % | ||||||
(1) Conversion expense stems from an upcoming system upgrade that will provide greater efficiency and product offerings.
(in thousands) | Three Months Ended | |||||||||||
Annualized Net Income for Ratio Calculation | March 31, 2025 | December 31, 2024 | March 31, 2024 | |||||||||
Net income per GAAP | $ | 3,236 | $ | 3,079 | $ | 2,174 | ||||||
Less: items not annualized: | ||||||||||||
Partnership income net of tax of ($52) and ($35) for the periods ended March 31, 2025 and 2024, respectively | (197 | ) | - | (134 | ) | |||||||
Recovery of credit losses, net of tax of ($13) and ($2) for the periods ended December 31, 2024 and March 31, 2024, respectively | - | (47 | ) | (8 | ) | |||||||
Merger-related expense, net of tax of $5 for the period ended December 31, 2024 and $0 for the period ended March 31, 2024 | - | 20 | 484 | |||||||||
Conversion expense, net of tax of $10 for the period ended March 31, 2025 (1) | 36 | - | - | |||||||||
Total non-annualized items | (161 | ) | (27 | ) | 342 | |||||||
Adjusted net income | $ | 3,075 | $ | 3,052 | $ | 2,516 | ||||||
Adjusted net income, annualized | $ | 12,471 | $ | 12,142 | $ | 10,119 | ||||||
Add: total non-annualized items | 161 | 27 | (342 | ) | ||||||||
Annualized net income for ratio calculation (non-GAAP) | $ | 12,632 | $ | 12,169 | $ | 9,777 | ||||||
Return on average assets (GAAP) | 0.72 | % | 0.68 | % | 0.53 | % | ||||||
Adjusted return on average assets (non-GAAP) | 0.69 | % | 0.68 | % | 0.59 | % | ||||||
Return on average equity (GAAP) | 8.14 | % | 7.68 | % | 6.43 | % | ||||||
Adjusted return on average equity (non-GAAP) | 7.84 | % | 7.63 | % | 7.19 | % | ||||||
(1) Conversion expense stems from an upcoming system upgrade that will provide greater efficiency and product offerings.
As of | ||||||||||||
(in thousands) | March 31, 2025 | December 31, 2024 | March 31, 2024 | |||||||||
Tangible Assets | ||||||||||||
Total assets (GAAP) | $ | 1,835,717 | $ | 1,811,636 | $ | 1,689,206 | ||||||
Less: goodwill and intangible asses | (12,484 | ) | (12,581 | ) | (5,848 | ) | ||||||
Tangible assets (non-GAAP) | $ | 1,823,233 | $ | 1,799,055 | $ | 1,683,358 | ||||||
Tangible Common Equity | ||||||||||||
Total stockholders' equity (GAAP) | $ | 167,278 | $ | 156,409 | $ | 139,390 | ||||||
Less: goodwill and intangible assets | (12,484 | ) | (12,581 | ) | (5,848 | ) | ||||||
Tangible common equity (non-GAAP) | $ | 154,794 | $ | 143,828 | $ | 133,542 | ||||||