Botetourt Bankshares (BORT) 8-K Botetourt Bankshares, Inc Announces Record Annual Earnings for 2006

EXHIBIT 99

FOR RELEASE 9:00 a.m. January 31, 2007

BOTETOURT BANKSHARES, Inc.

19747 Main Street

Buchanan, Virginia 24066

For Further Information Contact:

Michelle A. Alexander, Chief Financial Officer

(540) 591-5013

BOTETOURT BANKSHARES, INC ANNOUNCES RECORD ANNUAL EARNINGS FOR 2006

BUCHANAN, VIRGINIA.January 31, 2007 — Buchanan-based Botetourt Bankshares, Inc. announced today its consolidated financial results for the year-ending December 31, 2006. Net income for the fourth quarter amounted to $803,427, or $0.65 per share. This amount compares to $774,829, or $0.63 per share, for the same period last year, representing an increase of $28,598 or 3.69%.

Net income for the fiscal year 2006 amounted to $3,477,055, which is the highest recorded income in the company’s history. This amount compares to $3,210,022, for the same period of 2005, representing an increase of $267,033 or 8.32%. Both basic and diluted earnings per share increased $0.20 from $2.60 at December 31, 2005 to $2.80 at December 31, 2006.

At December 31, 2006 total assets amounted to $254,382,317, an increase of 6.64% above the prior year and total deposits increased by 5.28% to $227,229,407 over the prior year.

In addition, the company announced an increase in its shareholder dividend payment to $0.20 per share, payable on February 10, 2007, an increase of 11.11% in the quarterly dividend payment.

H. Watts Steger, Chairman and Chief Executive Officer of Botetourt Bankshares, Inc., stated “We are extremely gratified to report record annual earnings for the third consecutive year. The company’s performance reflects the execution of a philosophy towards solid and paced growth. The continuing positive earnings trend can be attributed to an economy fostering steady loan demand in our market coupled with our company’s strong asset quality.”

Botetourt Bankshares, Inc. is the holding company for Bank of Botetourt, which was chartered in 1899. Bank of Botetourt operates eight full service offices in Botetourt, Rockbridge, and Roanoke counties.

Information in this press release contains “forward-looking statements.” These statements involve risks and uncertainties that could cause actual results to differ materially including, without limitation, the effects of future economic conditions, governmental fiscal and monetary policies, legislative and regulatory changes, the risks of changes in interest rates and the effects of competition. Additional factors that could cause actual results to differ materially are discussed in Botetourt Bankshares, Inc.’s recent filings with the Securities and Exchange Commission, included but not limited to its Annual Report on Form 10-KSB and its other periodic reports.

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	(unaudited)			(audited)
	2006			2005
Assets
Cash and due from banks	$	8,258,003		$	8,985,579
Interest-bearing deposits with banks		163,151			291,648
Federal funds sold		—			6,752,000
Investment securities available for sale		24,798,980			27,940,163
Investment securities held to maturity		1,539,933			1,809,776
Restricted equity securities		524,600			474,000
Loans, net of allowance for loan losses of $2,502,122 in 2006 and $2,271,074 in 2005		209,541,312			183,352,611
Property and equipment, net		5,625,914			5,784,284
Accrued income		1,513,122			1,222,811
Foreclosed assets		—			—
Other assets		2,417,302			1,920,863
Total assets	$	254,382,317		$	238,533,735
Liabilities and Stockholders’ Equity
Liabilities
Noninterest-bearing deposits	$	33,768,568		$	31,365,352
Interest-bearing deposits		193,460,839			184,477,729
Total deposits		227,229,407			215,843,081
Federal Funds Purchased		1,341,000			—
Accrued interest payable		943,449			548,317
Other liabilities		1,245,669			407,292
Total liabilities		230,759,525			216,798,690
Commitments and contingencies		—			—
Stockholders’ equity
Common stock, $1.00 par value; 2,500,000 shares authorized; 1,241,750 and 1,240,121 shares issued and outstanding in 2006 and 2005, respectively		1,241,750			1,240,121
Additional paid-in capital		1,546,984			1,510,751
Retained earnings		21,544,114			18,960,299
Accumulated other comprehensive income (loss)		(710,056	)		23,874
Total stockholders’ equity		23,662,792			21,735,045
Total liabilities and stockholders’ equity	$	254,382,317		$	238,533,735

	(Unaudited)		(Audited)		(Audited)
	2006		2005		2004
Interest income
Loans and fees on loans	$	15,401,475	$	12,743,231	$	10,715,312
Federal funds sold		339,821		158,555		55,295
Investment securities:
Taxable		786,534		569,211		520,900
Exempt from federal income tax		371,941		371,339		380,673
Dividend income		43,369		33,247		27,249
Deposits with banks		12,103		5,422		2,481
Total interest income		16,955,243		13,881,005		11,701,910
Interest expense
Deposits		6,047,705		4,052,837		3,325,837
Federal funds purchased		35,943		16,848		13,751
Total interest expense		6,083,648		4,069,685		3,339,588
Net interest income		10,871,595		9,811,320		8,362,322
Provision for loan losses		300,000		450,000		725,000
Net interest income after provision for loan losses		10,571,595		9,361,320		7,637,322
Noninterest income
Service charges on deposit accounts		886,511		859,425		760,277
Other service charges and fees		191,211		178,603		181,832
Mortgage origination fees		340,376		407,115		313,079
Commissions on title services		181,085		224,748		174,729
Net realized gains (losses) on sales of securities		—		7,198		656
Other income		194,539		241,332		202,010
Total noninterest income		1,793,722		1,918,421		1,632,583
Noninterest expense
Salaries and employee benefits		4,238,694		3,814,394		3,378,528
Occupancy		412,882		391,494		359,963
Equipment		690,582		569,671		458,379
Foreclosed assets, net		2,559		36,665		1,059
Advertising and public relations		188,055		142,994		176,090
Outside services		183,042		163,507		154,746
Other general and administrative		1,599,559		1,506,416		1,305,226
Total noninterest expense		7,315,373		6,625,141		5,833,991
Income before income taxes		5,049,944		4,654,600		3,435,914
Income tax expense		1,572,889		1,444,578		1,035,716
Net income	$	3,477,055	$	3,210,022	$	2,400,198
Basic earnings per share	$	2.80	$	2.60	$	1.95
Diluted earnings per share	$	2.80	$	2.60	$	1.95
Basic weighted average shares outstanding		1,240,755		1,235,657		1,232,645
Diluted weighted average shares outstanding		1,243,622		1,236,967		1,233,356