Exhibit 99.1
NEWS RELEASE
FOR IMMEDIATE RELEASE
Contact:
Jeffrey W. Farrar
Executive Vice President and CFO
(540) 829-1603
farrarj@vfgi.net
VIRGINIA FINANCIAL GROUP, INC. ANNOUNCES 18%
GROWTH IN THIRD QUARTER EARNINGS
Culpeper, VA-Virginia Financial Group, Inc. (NASDAQ: VFGI) today reported third quarter 2005 earnings of $4.7 million, an increase of 18.2% compared to earnings of $4.0 million for the third quarter of 2004. Net income per diluted share was $.65, also up 18.2% compared to $.55 for the same period in 2004. VFG’S earnings for the third quarter of 2005 produced an annualized return on average assets (ROA) of 1.26% and an annualized return on average equity (ROE) of 14.03%, compared to prior year ratios of 1.11% and 12.99%, respectively. For the first nine months of 2005, net income was $13.2 million, up 18.6% from $11.1 million for the same period in 2004. Net income per diluted share was $1.83, up 18.1% from $1.55 for the first nine months of 2004. ROA and ROE for the nine month period was 1.20% and 13.60%, respectively, compared to 1.05% and 12.24% for the same period in 2004.
O.R. Barham, Jr., President and CEO, commented, “We are quite pleased with our results for the quarter, particularly with revenue and balance sheet growth. Revenue growth was fueled by an 18.5% annualized growth rate in loans for the quarter and a 13 basis point improvement in net interest margin sequentially. We saw our efficiency ratio drop to its lowest level in several years, and our return on average equity eclipse 14% for the quarter. Deposit growth also showed some improvement, and we are excited about the prospects of deposit growth from new branches coming on-line in the next several quarters. Our balance sheet reached the $1.5 billion level, an important milestone and one in which we can be proud of.”
REVENUE GROWTH
Total revenue, comprised of net interest income and noninterest income, was $18.5 million for the third quarter of 2005, an increase of $1.7 million or 10.3% over $16.8 million in 2004. The largest component, net interest income, amounted to $14.7 million for the third quarter, up $1.5 million or 11.4% compared with $13.2 million for the same quarter in 2004. For the nine months ended September 30, 2005, net interest income was $41.6 million, an increase of $3.4 million or 8.9% from $38.2 million for the same period in 2004. Improvements in the growth and mix of average earning assets, coupled with net interest
margin expansion, were primarily contributors to this growth. The net interest margin for the third quarter of 2005 was 4.36%, up thirteen basis points sequentially compared to 4.23% for the second quarter of 2005, and up twenty-two basis points when compared to 4.14% for the third quarter of 2004. The net interest margin for the nine month period ended September 30, 2005 was 4.25%, compared to 4.09% for the same period in 2004.
Total noninterest income was $3.9 million for the third quarter of 2005, an increase of $228 thousand or 6.3% compared to $3.6 million for the third quarter of 2004. Retail banking fees decreased $266 thousand or 13.2% to $1.7 million, compared to $2.0 million in the third quarter of 2004. VFG continues to see decline in the volume of NSF charges attributable to trends noted with respect to a corresponding decrease in paper items processed and increase in pre-authorized electronic banking transactions such as ATM and debit card transactions. VFG experienced higher revenues and profitability from mortgage operations, with gross mortgage banking fees amounting to $1.0 million, a increase of $488 thousand or 91.4%, as compared to $534 thousand for the third quarter of 2004, and up sequentially $345 thousand or 51.1% from the second quarter of 2005. Revenues and profitability are anticipated to decline somewhat in the fourth quarter due to seasonal fluctuation and potential increases in mortgage rates.
NONINTEREST EXPENSE AND EFFICIENCY
Noninterest expense for the third quarter of 2005 amounted to $11.1 million, up $661 thousand or 6.3% from $10.4 million for the same period in 2004, and up sequentially $293 thousand or 2.7% from the second quarter of 2005. For the nine month period ended September 30, 2005, noninterest expense amounted to $32.4 million, an increase of $921 thousand or 2.9% over $31.5 million for the same period in 2004. The relatively modest increases are attributable to a fairly stable full-time equivalent employee count and related costs associated with health and welfare benefits, no significant expansion activities during the period, and general improvements in overall efficiency. Some acceleration of costs associated with training and professional fees was noted in the quarter, and management anticipates that these increases will continue to grow to a more normalized level as it accelerates its expansion efforts and completes several sales and credit training initiatives in the fourth quarter of 2005. VFG’s efficiency ratio was 58.3% for the quarter, compared to 60.2% for the same quarter in 2004. For the nine month period ended September 30, 2005, the efficiency ratio was 59.6%, compared to 62.1% for the same period in 2004.
BALANCE SHEET
Average loans for the third quarter were $1.13 billion, up $121.3 million or 12.0% from the third quarter of 2004, and average total assets were $1.48 billion, up $54.8 million or 3.8% from the third quarter of 2004. Loan growth for the third quarter of 2005 was $51.5 million or 4.6%, with approximately 70% of the increase originating from the non-residential real estate component of the portfolio. Third quarter 2005 loan growth was funded from maturities and pay downs in the securities portfolio of $12.9 million, deposit growth of $19.7 million and wholesale funding of $16.8 million.
Deposit growth was predominately in the money market component, with money market balances up $27.5 million or 7.8% for the quarter, reflecting a successful deposit campaign during the period. Non-interest bearing demand deposits were down $8.1 million or 3.1% for the quarter, due to lower balances associated with real estate closings, but are up $36.7 million or 16.6% when compared to a year ago.
At September 30, 2005 VFG had total assets of $1.50 billion, compared to $1.44 billion at September 30, 2004. Shareholder’s equity at September 30, 2005 was $134.5 million, an increase of $8.4 million or 6.7% compared to September 30, 2004. Shareholder’s equity represented 8.91% of total assets at September 30, 2005, while tangible equity capital represented 7.78% of tangible assets at September 30, 2005. Book value at September 30, 2005 was $18.70 per share, compared to $17.55 at September 30, 2004.
ASSET QUALITY
Asset quality remains strong, with VFG’s ratio of non-performing assets as a percentage of total assets amounting to .11% as of September 30, 2005, compared to ..28% at September 30, 2004 and .11% at June 30, 2005. Net charge-offs as a percentage of average loans receivable amounted to .01% for the quarter and .02% for the nine month period ended September 30, 2005, compared to .01% and .04% for the same periods in 2004. At September 30, 2005, the allowance for loan losses was approximately eight times the level of non-performing assets, while the allowance as a percentage of total loans amounted to 1.13%. VFG decreased its provision for loan losses by $133 thousand or 20.9%, from $636 thousand for the three months ended September 30, 2004 compared to $503 thousand for the three months ended September 30, 2005, consistent with charge-off experience and general improvement in asset quality during the period.
UPDATE ON SUPERVISORY AGREEMENT REGARDING BANK SECRECY ACT COMPLIANCE
VFG has received verbal notification from the Federal Reserve Bank of Richmond that it now is in full compliance with Bank Secrecy Act (“BSA”) regulations, and has recommended the lifting of the supervisory agreement to the Federal Reserve Board. VFG continues to anticipate this event occurring in the near future, but can give no assurances as to the timing of such event.
ABOUT VFG
VFG is the holding company for Planters Bank & Trust Company of Virginia – in Staunton; Second Bank & Trust – in Culpeper; Virginia Heartland Bank – in Fredericksburg and Virginia Commonwealth Trust Company – in Culpeper. The Company is a traditional community banking provider, offering a full range of business and consumer banking services including trust and asset management service via its trust company affiliate. The organization maintains a network of thirty-five branches serving Central and Southwest Virginia. It also maintains five trust and investment service offices in its markets, and loan production offices located in Charlottesville and Lynchburg.
NON-GAAP FINANCIAL MEASURES
This report refers to the efficiency ratio, which is computed by dividing non-interest expense by the sum of net interest income on a tax equivalent basis and non-interest income excluding gain on sale of securities. This is a non-GAAP financial measure that we believe provides investors with important information regarding our operational efficiency. Such information is not in accordance with generally accepted accounting principles (GAAP) and should not be construed as such. Management believes such financial information is meaningful to the reader in understanding operating performance, but cautions that such information not be viewed as a substitute for GAAP. VFG, in referring to its net income, is referring to income under generally accepted accounting principles, or “GAAP”.
FORWARD LOOKING STATEMENTS
In addition to historical information, this press release contains forward-looking statements. The forward-looking statements are subject to certain risks and uncertainties, which could cause actual results to differ materially from historical results, or those anticipated. When we use words such as “believes”, “expects”, “anticipates” or similar expressions, we are making forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s analysis only as of the date thereof. VFG wishes to caution the reader that factors, such as those listed below, in some cases have affected and could affect VFG’s actual results, causing actual results to differ materially from those in
any forward looking statement. These factors include: (i) expected cost savings from VFG’s acquisitions and dispositions, (ii) competitive pressure in the banking industry or in VFG’s markets may increase significantly, (iii) changes in the interest rate environment may reduce margins, (iv) general economic conditions, either nationally or regionally, may be less favorable than expected, resulting in, among other things, credit quality deterioration, (v) changes may occur in banking legislation and regulation, or VFG may not be released from its supervisory agreement with the Federal Reserve related to Bank Secrecy Compliance within anticipated timeframes, (vi) changes may occur in general business conditions and (vii) changes may occur in the securities markets. Please refer to VFG’s filings with the Securities and Exchange Commission for additional information, which may be accessed at www.vfgi.net.
QUARTERLY PERFORMANCE SUMMARY
Virginia Financial Group, Inc. (NASDAQ: VFGI)
(Dollars in thousands, except per share data)
For the Three Months Ended | Percent Increase (Decrease) | ||||||||||
9/30/2005 | 9/30/2004 | ||||||||||
INCOME STATEMENT | |||||||||||
Interest income - taxable equivalent | $ | 21,091 | $ | 18,372 | 14.80 | % | |||||
Interest expense | 6,040 | 4,775 | 26.49 | % | |||||||
Net interest income - taxable equivalent | 15,051 | 13,597 | 10.69 | % | |||||||
Less: taxable equivalent adjustment | 394 | 436 | -9.63 | % | |||||||
Net interest income | 14,657 | 13,161 | 11.37 | % | |||||||
Provision for loan and lease losses | 503 | 636 | -20.91 | % | |||||||
Net interest income after provision for loan and lease losses | 14,154 | 12,525 | 13.01 | % | |||||||
Noninterest income | 3,870 | 3,642 | 6.26 | % | |||||||
Noninterest expense | 11,094 | 10,433 | 6.34 | % | |||||||
Provision for income taxes | 2,211 | 1,743 | 26.85 | % | |||||||
Net income | $ | 4,719 | $ | 3,991 | 18.24 | % | |||||
PER SHARE DATA | |||||||||||
Basic earnings | $ | 0.66 | $ | 0.56 | 17.86 | % | |||||
Diluted earnings | $ | 0.65 | $ | 0.55 | 18.18 | % | |||||
Shares outstanding | 7,170,828 | 7,160,417 | |||||||||
Weighted average shares - | |||||||||||
Basic | 7,170,525 | 7,160,417 | |||||||||
Diluted | 7,218,383 | 7,201,641 | |||||||||
Dividends paid on common shares | $ | 0.21 | $ | 0.20 | |||||||
PERFORMANCE RATIOS | |||||||||||
Return on average assets | 1.26 | % | 1.11 | % | 13.51 | % | |||||
Return on average equity | 14.03 | % | 12.99 | % | 8.01 | % | |||||
Return on average realized equity (A) | 14.03 | % | 13.12 | % | 6.94 | % | |||||
Net interest margin (taxable equivalent) | 4.36 | % | 4.14 | % | 5.31 | % | |||||
Efficiency (taxable equivalent) (B) | 58.29 | % | 60.25 | % | -3.26 | % | |||||
ASSET QUALITY | |||||||||||
Allowance for loan losses | |||||||||||
Beginning of period | $ | 12,664 | $ | 10,799 | |||||||
Provision for loan losses | 503 | 636 | |||||||||
Charge offs | (84 | ) | (184 | ) | |||||||
Recoveries | 44 | 49 | |||||||||
End of period | $ | 13,127 | $ | 11,300 |
NOTES: | Applicable ratios are annualized |
(A) | Excludes the effect on average stockholders’ equity of unrealized gains (losses) that result from changes in market values of securities and other comprehensive pension expense. |
(B) | Excludes securities gains (losses) and foreclosed property expense for all periods. |
QUARTERLY PERFORMANCE SUMMARY
Virginia Financial Group, Inc. (NASDAQ: VFGI)
(Dollars in thousands, except per share data)
For the Nine Months Ended | Percent Increase | ||||||||||
9/30/2005 | 9/30/2004 | ||||||||||
INCOME STATEMENT | |||||||||||
Interest income - taxable equivalent | $ | 60,002 | $ | 53,917 | 11.29 | % | |||||
Interest expense | 17,173 | 14,356 | 19.62 | % | |||||||
Net interest income - taxable equivalent | 42,829 | 39,561 | 8.26 | % | |||||||
Less: taxable equivalent adjustment | 1,199 | 1,346 | -10.92 | % | |||||||
Net interest income | 41,630 | 38,215 | 8.94 | % | |||||||
Provision for loan and lease losses | 1,595 | 1,953 | -18.33 | % | |||||||
Net interest income after provision for loan and lease losses | 40,035 | 36,262 | 10.40 | % | |||||||
Noninterest income | 11,643 | 11,048 | 5.39 | % | |||||||
Noninterest expense | 32,424 | 31,503 | 2.92 | % | |||||||
Provision for income taxes | 6,051 | 4,676 | 29.41 | % | |||||||
Net income | $ | 13,203 | $ | 11,131 | 18.61 | % | |||||
PER SHARE DATA | |||||||||||
Basic earnings | $ | 1.84 | $ | 1.56 | 17.95 | % | |||||
Diluted earnings | $ | 1.83 | $ | 1.55 | 18.06 | % | |||||
Shares outstanding | 7,170,828 | 7,160,417 | |||||||||
Weighted average shares - | |||||||||||
Basic | 7,166,947 | 7,157,833 | |||||||||
Diluted | 7,215,668 | 7,201,815 | |||||||||
Dividends paid on common shares | $ | 0.62 | $ | 0.58 | |||||||
PERFORMANCE RATIOS | |||||||||||
Return on average assets | 1.20 | % | 1.05 | % | 14.29 | % | |||||
Return on average equity | 13.60 | % | 12.24 | % | 11.11 | % | |||||
Return on average realized equity (A) | 13.67 | % | 12.55 | % | 8.92 | % | |||||
Net interest margin (taxable equivalent) | 4.25 | % | 4.09 | % | 3.91 | % | |||||
Efficiency (taxable equivalent) (B) | 59.64 | % | 62.13 | % | -4.01 | % | |||||
ASSET QUALITY | |||||||||||
Allowance for loan losses | |||||||||||
Beginning of period | $ | 11,706 | $ | 9,743 | |||||||
Provision for loan losses | 1,595 | 1,953 | |||||||||
Charge offs | (403 | ) | (538 | ) | |||||||
Recoveries | 229 | 142 | |||||||||
End of period | $ | 13,127 | $ | 11,300 | |||||||
Non-performing assets: | |||||||||||
Non-accrual loans | $ | 1,422 | $ | 2,116 | |||||||
Loans 90+ days past due and still accruing | — | 1 | |||||||||
Other real estate owned | 41 | 5 | |||||||||
Troubled debt restructurings | 173 | 1,937 | |||||||||
Total non-performing assets | $ | 1,636 | $ | 4,059 | |||||||
to total assets: | 0.11 | % | 0.28 | % | |||||||
to total loans plus OREO: | 0.14 | % | 0.39 | % | |||||||
Allowance for loan losses to total loans | 1.13 | % | 1.09 | % | |||||||
Net charge-offs (recoveries) | $ | 174 | $ | 396 | |||||||
Net charge-offs to average loans outstanding | 0.02 | % | 0.04 | % |
NOTES: | Applicable ratios are annualized |
(A) | Excludes the effect on average stockholders’ equity of unrealized gains (losses) that result from changes in market values of securities and other comprehensive pension expense. |
(B) | Excludes securities gains (losses) and foreclosed property expense for all periods. |
QUARTERLY PERFORMANCE SUMMARY
Virginia Financial Group, Inc. (NASDAQ: VFGI)
(Dollars in thousands, except per share data)
9/30/2005 | 9/30/2004 | Percent Increase (Decrease) | |||||||||
SELECTED BALANCE SHEET DATA | |||||||||||
End of period balances | |||||||||||
Cash and Cash Equivalents | $ | 52,874 | $ | 52,662 | 0.40 | % | |||||
Securities available for sale | 215,070 | 292,096 | -26.37 | % | |||||||
Securities held to maturity | 4,284 | 5,846 | -26.72 | % | |||||||
Total securities | 219,354 | 297,942 | -26.38 | % | |||||||
Real estate - construction | 132,073 | 106,356 | 24.18 | % | |||||||
Real estate - 1-4 family residential | 325,860 | 316,425 | 2.98 | % | |||||||
Real estate - commercial and multifamily | 577,243 | 479,760 | 20.32 | % | |||||||
Commercial, financial and agricultural | 84,951 | 82,307 | 3.21 | % | |||||||
Consumer loans | 41,943 | 45,587 | -7.99 | % | |||||||
All other loans | 2,496 | 2,740 | -8.91 | % | |||||||
Total loans | 1,164,566 | 1,033,175 | 12.72 | % | |||||||
Deferred loan costs | 476 | 333 | 42.94 | % | |||||||
Allowance for loan losses | (13,127 | ) | (11,300 | ) | 16.17 | % | |||||
Net loans | 1,151,915 | 1,022,208 | 12.69 | % | |||||||
Other assets | 133,624 | 119,606 | 11.72 | % | |||||||
Total assets | 1,504,893 | 1,439,756 | 4.52 | % | |||||||
Non-interest bearing deposits | 257,019 | 220,355 | 16.64 | % | |||||||
Money market & interest checking | 379,579 | 389,970 | -2.66 | % | |||||||
Savings | 129,051 | 141,508 | -8.80 | % | |||||||
CD’s and other time deposits | 503,180 | 498,888 | 0.86 | % | |||||||
Total deposits | 1,268,829 | 1,250,721 | 1.45 | % | |||||||
Short-term borrowed funds | 37,481 | 20,400 | 83.73 | % | |||||||
Trust preferred capital notes | 20,619 | 20,000 | 3.10 | % | |||||||
Federal Home Loan Bank advances | 35,000 | 14,080 | 148.58 | % | |||||||
Other liabilities | 8,856 | 8,876 | -0.23 | % | |||||||
Total liabilities | 1,370,785 | 1,314,077 | 4.32 | % | |||||||
Total stockholders’ equity | $ | 134,108 | $ | 125,679 | 6.71 | % | |||||
Accumulated Comprehensive Income (Loss) | $ | (480 | ) | $ | 2,903 | -116.53 | % | ||||
Average balances | |||||||||||
For the Nine Months Ended | Percent Increase (Decrease) | ||||||||||
9/30/2005 | 9/30/2004 | ||||||||||
Total assets | $ | 1,465,144 | $ | 1,411,928 | 3.77 | % | |||||
Total stockholders’ equity | $ | 129,799 | $ | 121,472 | 6.86 | % | |||||
For the Three Months Ended | |||||||||||
9/30/2005 | 9/30/2004 | ||||||||||
Total assets | $ | 1,480,148 | $ | 1,425,341 | 3.85 | % | |||||
Total stockholders’ equity | $ | 133,444 | $ | 122,230 | 9.17 | % |
QUARTERLY PERFORMANCE SUMMARY
Virginia Financial Group, Inc. (NASDAQ: VFGI)
(Dollars in thousands)
For the Three Months Ended | Percent (Decrease) | ||||||||
9/30/2005 | 9/30/2004 | ||||||||
Interest Income | |||||||||
Interest and fees on loans | $ | 18,335 | $ | 14,969 | 22.49 | % | |||
Interest on deposits in other banks | 5 | 1 | 400.00 | % | |||||
Interest and dividends on securities: | |||||||||
Taxable | 1,530 | 2,115 | -27.66 | % | |||||
Tax-exempt | 642 | 696 | -7.76 | % | |||||
Dividends | 79 | 132 | -40.15 | % | |||||
Interest income on federal funds sold | 106 | 23 | 360.87 | % | |||||
Total interest income | 20,697 | 17,936 | 15.39 | % | |||||
Interest Expense | |||||||||
Interest on deposits | 5,195 | 4,322 | 20.20 | % | |||||
Interest on federal funds repurchased and securities sold under agreements to repurchase | 135 | 47 | 187.23 | % | |||||
Interest on Federal Home Loan Bank advances | 313 | 181 | 72.93 | % | |||||
Interest on trust preferred capital notes | 328 | 220 | 49.09 | % | |||||
Interest on other short-term borrowings | 69 | 5 | 1280.00 | % | |||||
Total interest expense | 6,040 | 4,775 | 26.49 | % | |||||
Net interest income | 14,657 | 13,161 | 11.37 | % | |||||
Provision for loan losses | 503 | 636 | -20.91 | % | |||||
Net interest income after provision for loan losses | 14,154 | 12,525 | 13.01 | % | |||||
Noninterest Income | |||||||||
Retail banking fees | 1,745 | 2,011 | -13.23 | % | |||||
Commissions and fees from fiduciary activities | 696 | 676 | 2.96 | % | |||||
Investment fee income | 158 | 169 | -6.51 | % | |||||
Other operating income | 247 | 252 | -1.98 | % | |||||
Gains (losses) on sale of fixed assets | 2 | — | — | ||||||
Gains (losses) on securities available for sale | — | — | — | ||||||
Gains (losses) on sale of other real estate owned | — | — | — | ||||||
Gains (losses) on sale of branches | — | — | — | ||||||
Gain on sale of mortgage loans | 1,022 | 534 | 91.39 | % | |||||
Total noninterest income | 3,870 | 3,642 | 6.26 | % | |||||
Noninterest Expense | |||||||||
Compensation and employee benefits | 6,456 | 5,793 | 11.44 | % | |||||
Net occupancy expense | 787 | 697 | 12.91 | % | |||||
Supplies and equipment expenses | 919 | 1,085 | -15.30 | % | |||||
Amortization-intangible assets | 158 | 173 | -8.67 | % | |||||
Marketing | 296 | 165 | 79.39 | % | |||||
State franchise taxes | 208 | 145 | 43.45 | % | |||||
Data processing | 315 | 350 | -10.00 | % | |||||
Telecommunications | 273 | 227 | 20.26 | % | |||||
Professional fees | 232 | 162 | 43.21 | % | |||||
Other operating expenses | 1,450 | 1,636 | -11.37 | % | |||||
Total noninterest expense | 11,094 | 10,433 | 6.34 | % | |||||
Income before income taxes | 6,930 | 5,734 | 20.86 | % | |||||
Income tax expense | 2,211 | 1,743 | 26.85 | % | |||||
Net income | $ | 4,719 | $ | 3,991 | 18.24 | % |
QUARTERLY PERFORMANCE SUMMARY
Virginia Financial Group, Inc. (NASDAQ: VFGI)
(Dollars in thousands)
For the Nine Months Ended | Percent (Decrease) | ||||||||
9/30/2005 | 9/30/2004 | ||||||||
Interest Income | |||||||||
Interest and fees on loans | $ | 51,501 | $ | 43,263 | 19.04 | % | |||
Interest on deposits in other banks | 11 | 3 | 266.67 | % | |||||
Interest and dividends on securities: | |||||||||
Taxable | 4,955 | 6,859 | -27.76 | % | |||||
Tax-exempt | 1,949 | 2,158 | -9.68 | % | |||||
Dividends | 261 | 256 | 1.95 | % | |||||
Interest income on federal funds sold | 126 | 32 | 293.75 | % | |||||
Total interest income | 58,803 | 52,571 | 11.85 | % | |||||
Interest Expense | |||||||||
Interest on deposits | 14,815 | 13,093 | 13.15 | % | |||||
Interest on federal funds repurchased and securities sold under agreements to repurchase | 423 | 161 | 162.73 | % | |||||
Interest on Federal Home Loan Bank advances | 742 | 519 | 42.97 | % | |||||
Interest on trust preferred capital notes | 904 | 442 | 104.52 | % | |||||
Interest on other short-term borrowings | 289 | 141 | 104.96 | % | |||||
Total interest expense | 17,173 | 14,356 | 19.62 | % | |||||
Net interest income | 41,630 | 38,215 | 8.94 | % | |||||
Provision for loan losses | 1,595 | 1,953 | -18.33 | % | |||||
Net interest income after provision for loan losses | 40,035 | 36,262 | 10.40 | % | |||||
Noninterest Income | |||||||||
Retail banking fees | 5,219 | 5,610 | -6.97 | % | |||||
Commissions and fees from fiduciary activities | 2,207 | 2,136 | 3.32 | % | |||||
Investment fee income | 519 | 514 | 0.97 | % | |||||
Other operating income | 1,220 | 773 | 57.83 | % | |||||
Gains (losses) on sale of fixed assets | 1 | — | — | ||||||
Gains (losses) on securities available for sale | 296 | — | — | ||||||
Gains (losses) on sale of other real estate owned | — | — | — | ||||||
Gains (losses) on sale of branches | — | — | — | ||||||
Gain on sale of mortgage loans | 2,181 | 2,015 | 8.24 | % | |||||
Total noninterest income | 11,643 | 11,048 | 5.39 | % | |||||
Noninterest Expense | |||||||||
Compensation and employee benefits | 18,552 | 17,601 | 5.40 | % | |||||
Net occupancy expense | 2,184 | 2,073 | 5.35 | % | |||||
Supplies and equipment expenses | 3,127 | 3,224 | -3.01 | % | |||||
Amortization-intangible assets | 485 | 520 | -6.73 | % | |||||
Marketing | 754 | 467 | 61.46 | % | |||||
State franchise taxes | 662 | 455 | 45.49 | % | |||||
Data processing | 942 | 1,091 | -13.66 | % | |||||
Telecommunications | 770 | 794 | -3.02 | % | |||||
Professional fees | 629 | 653 | -3.68 | % | |||||
Other operating expenses | 4,319 | 4,624 | -6.60 | % | |||||
Total noninterest expense | 32,424 | 31,502 | 2.93 | % | |||||
Income before income taxes | 19,254 | 15,808 | 21.80 | % | |||||
Income tax expense | 6,051 | 4,677 | 29.38 | % | |||||
Net income | $ | 13,203 | $ | 11,131 | 18.61 | % |
VIRGINIA FINANCIAL GROUP INC.
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES
THREE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
(Dollars in thousands)
Three months ended September 30, | ||||||||||||||||||
2005 | 2004 | |||||||||||||||||
Dollars in thousands | Average Balance | Interest Inc/Exp | Average Rates | Average Balance | Interest Inc/Exp | Average Rates | ||||||||||||
Assets | ||||||||||||||||||
Loans receivable, net | $ | 1,130,355 | $ | 18,383 | 6.45 | % | $ | 1,009,099 | $ | 15,028 | 5.92 | % | ||||||
Investment securities | ||||||||||||||||||
Taxable | 164,792 | 1,610 | 3.88 | % | 226,491 | 2,249 | 3.95 | % | ||||||||||
Tax exempt | 61,207 | 988 | 6.40 | % | 65,268 | 1,072 | 6.53 | % | ||||||||||
Total investments | 225,999 | 2,598 | 4.56 | % | 291,759 | 3,321 | 4.53 | % | ||||||||||
Interest bearing deposits | 823 | 4 | 1.93 | % | 323 | 1 | 1.03 | % | ||||||||||
Federal funds sold | 12,422 | 106 | 3.39 | % | 5,962 | 22 | 0.92 | % | ||||||||||
239,244 | 2,708 | 4.49 | % | 298,044 | 3,344 | 4.46 | % | |||||||||||
Total earning assets | 1,369,599 | 21,091 | 6.11 | % | 1,307,143 | 18,372 | 5.59 | % | ||||||||||
Total nonearning assets | 110,549 | 118,198 | ||||||||||||||||
Total assets | $ | 1,480,148 | $ | 1,425,341 | ||||||||||||||
Liabilities and Stockholders’ Equity | ||||||||||||||||||
Interest-bearing deposits | ||||||||||||||||||
Interest checking | $ | 189,899 | $ | 202 | 0.42 | % | $ | 196,015 | $ | 185 | 0.38 | % | ||||||
Money market | 176,364 | 601 | 1.35 | % | 181,754 | 414 | 0.91 | % | ||||||||||
Savings | 130,959 | 222 | 0.67 | % | 144,072 | 233 | 0.64 | % | ||||||||||
Time deposits: | ||||||||||||||||||
Less than $100,000 | 363,943 | 2,883 | 3.14 | % | 369,101 | 2,470 | 2.66 | % | ||||||||||
$100,000 and more | 138,015 | 1,287 | 3.70 | % | 122,270 | 1,020 | 3.32 | % | ||||||||||
Total interest-bearing deposits | 999,180 | 5,195 | 2.06 | % | 1,013,212 | 4,322 | 1.70 | % | ||||||||||
Federal funds purchased and securities sold under agreements to repurchase | 17,607 | 135 | 3.04 | % | 21,755 | 46 | 0.84 | % | ||||||||||
Trust preferred capital notes | 20,619 | 328 | 6.31 | % | 20,000 | 221 | 4.40 | % | ||||||||||
Other short term borrowings | 11,702 | 69 | 2.34 | % | 1,293 | 5 | 1.54 | % | ||||||||||
Federal Home Loan Bank advances | 31,105 | 313 | 3.99 | % | 13,505 | 181 | 5.33 | % | ||||||||||
81,033 | 845 | 4.14 | % | 56,553 | 453 | 3.19 | % | |||||||||||
Total interest-bearing liabilities | 1,080,213 | 6,040 | 2.22 | % | 1,069,765 | 4,775 | 1.78 | % | ||||||||||
Total noninterest-bearing liabilities | 266,491 | 233,346 | ||||||||||||||||
Total liabilities | 1,346,704 | 1,303,111 | ||||||||||||||||
Stockholders’ equity | 133,444 | 122,230 | ||||||||||||||||
Total liabilities and stockholders’ equity | $ | 1,480,148 | $ | 1,425,341 | ||||||||||||||
Net interest income (tax equivalent) | $ | 15,051 | $ | 13,597 | ||||||||||||||
Average interest rate spread | 3.89 | % | 3.81 | % | ||||||||||||||
Interest expense as percentage of average earning assets | 1.75 | % | 1.45 | % | ||||||||||||||
Net interest margin | 4.36 | % | 4.14 | % |
VIRGINIA FINANCIAL GROUP INC.
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES
NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
(Dollars in thousands)
Nine months ended September 30, | ||||||||||||||||||
2005 | 2004 | |||||||||||||||||
Dollars in thousands | Average Balance | Interest Inc/Exp | Average Rates | Average Balance | Interest Inc/Exp | Average Rates | ||||||||||||
Assets | ||||||||||||||||||
Loans receivable, net | $ | 1,102,011 | $ | 51,650 | 6.27 | % | $ | 976,363 | $ | 43,439 | 5.94 | % | ||||||
Investment securities | ||||||||||||||||||
Taxable | 178,407 | 5,216 | 3.91 | % | 242,746 | 7,115 | 3.92 | % | ||||||||||
Tax exempt | 61,645 | 2,999 | 6.50 | % | 67,586 | 3,328 | 6.58 | % | ||||||||||
Total investments | 240,052 | 8,215 | 4.58 | % | 310,332 | 10,443 | 4.49 | % | ||||||||||
Interest bearing deposits | 524 | 11 | 2.81 | % | 458 | 3 | 0.78 | % | ||||||||||
Federal funds sold | 6,417 | 126 | 2.63 | % | 3,357 | 32 | 0.93 | % | ||||||||||
246,993 | 8,352 | 4.53 | % | 314,147 | 10,478 | 4.46 | % | |||||||||||
Total earning assets | 1,349,004 | 60,002 | 5.95 | % | 1,290,510 | 53,917 | 5.58 | % | ||||||||||
Total nonearning assets | 116,140 | 121,418 | ||||||||||||||||
Total assets | $ | 1,465,144 | $ | 1,411,928 | ||||||||||||||
Liabilities and Stockholders’ Equity | ||||||||||||||||||
Interest-bearing deposits | ||||||||||||||||||
Interest checking | $ | 194,863 | $ | 601 | 0.41 | % | $ | 193,991 | $ | 754 | 0.52 | % | ||||||
Money market | 172,382 | 1,544 | 1.20 | % | 173,922 | 1,195 | 0.92 | % | ||||||||||
Savings | 132,972 | 665 | 0.67 | % | 140,716 | 718 | 0.68 | % | ||||||||||
Time deposits: | ||||||||||||||||||
Less than $100,000 | 365,460 | 8,454 | 3.09 | % | 370,700 | 7,426 | 2.68 | % | ||||||||||
$100,000 and more | 133,570 | 3,551 | 3.55 | % | 119,364 | 3,000 | 3.36 | % | ||||||||||
Total interest-bearing deposits | 999,247 | 14,815 | 1.98 | % | 998,693 | 13,093 | 1.75 | % | ||||||||||
Federal funds purchased and securities sold under agreements to repurchase | 22,868 | 423 | 2.47 | % | 25,919 | 161 | 0.83 | % | ||||||||||
Trust preferred capital notes | 20,619 | 904 | 5.86 | % | 14,380 | 442 | 4.11 | % | ||||||||||
Other short term borrowings | 13,503 | 289 | 2.86 | % | 12,798 | 141 | 1.47 | % | ||||||||||
Federal Home Loan Bank advances | 21,913 | 742 | 4.53 | % | 12,585 | 519 | 5.51 | % | ||||||||||
78,903 | 2,358 | 4.00 | % | 65,682 | 1,263 | 2.57 | % | |||||||||||
Total interest-bearing liabilities | 1,078,150 | 17,173 | 2.13 | % | 1,064,375 | 14,356 | 1.80 | % | ||||||||||
Total noninterest-bearing liabilities | 257,195 | 226,081 | ||||||||||||||||
Total liabilities | 1,335,345 | 1,290,456 | ||||||||||||||||
Stockholders’ equity | 129,799 | 121,472 | ||||||||||||||||
Total liabilities and stockholders’ equity | $ | 1,465,144 | $ | 1,411,928 | ||||||||||||||
Net interest income (tax equivalent) | $ | 42,829 | $ | 39,561 | ||||||||||||||
Average interest rate spread | 3.82 | % | 3.78 | % | ||||||||||||||
Interest expense as percentage of average earning assets | 1.70 | % | 1.49 | % | ||||||||||||||
Net interest margin | 4.25 | % | 4.09 | % |