Botetourt Bankshares (BORT) 8-K Botetourt Bankshares, Inc Announces Annual Earnings for 2010

Exhibit 99

FOR RELEASE February 3, 2011

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 ANNUAL EARNINGS FOR 2010

BUCHANAN, VIRGINIA.February 3, 2011 — Buchanan-based Botetourt Bankshares, Inc. announced today its consolidated financial results for the quarter and year-to-date periods ending December 31, 2010. Net income for the fourth quarter amounted to $204,421, or $0.16 per share. This amount compares to a net loss amounting to $97,976, or $0.08 per share, for the same period last year, representing an increase of $302,397 or 308.64%.

Net income for the fiscal year 2010 amounted to $417,183. This amount compares to $764,074 for the same period of 2009, representing a decrease of $346,891 or 45.40%. Both basic and diluted earnings per share decreased $0.28 from $0.61 at December 31, 2009 to $0.33 at December 31, 2010.

At December 31, 2010 total assets amounted to $310,019,331, an increase of 0.48% above the prior year and total deposits increased by 0.43% to $281,047,765 over the prior year.

The company announced a quarterly shareholder dividend payment of $0.04 per share, payable on February 18, 2011.

H. Watts Steger, Chairman and Chief Executive Officer of Botetourt Bankshares, Inc., said “While 2010 was a profitable year for the Company, it remained a challenging year for both our Bank and the industry. Earnings have been adversely impacted in 2010 due to a higher provision for loan losses as the Company continues to respond to loan delinquencies, impaired loans, and exposure in the real estate development market.”

Steger continued by noting “Bank of Botetourt remains well-capitalized according to regulatory standards. Our 112 year history has enabled us to weather this economic storm. We are committed to our shareholders by maintaining a dividend payment appropriate to 2011’s forecasted performance.”

Botetourt Bankshares, Inc. is the holding company for Bank of Botetourt, which was chartered in 1899. Bank of Botetourt operates ten full service offices in Botetourt, Rockbridge, Roanoke, and Franklin 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-K and its other periodic reports.

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Botetourt Bankshares, Inc.

Consolidated Balance Sheets

December 31, 2010 and December 31, 2009

	(unaudited)			(audited)
	2010			2009
Assets
Cash and due from banks	$	6,232,356		$	7,507,950
Interest-bearing deposits with banks		12,690,985			2,044,636
Federal funds sold		1,728,000			7,272,000
Investment securities available for sale		15,042,933			16,090,402
Investment securities held to maturity (fair value approximates $100,000 in 2010 and $99,800 in 2009)		100,000			100,000
Restricted equity securities		581,000			581,000
Loans, net of allowance for loan losses of $4,337,790 in 2010 and $3,947,025 in 2009		258,367,882			259,998,540
Property and equipment, net		7,661,323			8,058,292
Accrued income		1,338,662			1,253,125
Foreclosed assets		1,850,665			1,322,340
Other assets		4,425,525			4,306,288
Total assets	$	310,019,331		$	308,534,573
Liabilities and Stockholders’ Equity
Liabilities
Noninterest-bearing deposits	$	33,006,463		$	30,706,483
Interest-bearing deposits		248,041,302			249,133,352
Total deposits		281,047,765			279,839,835
Accrued interest payable		520,373			685,138
Other liabilities		2,051,912			1,403,272
Total liabilities		283,620,050			281,928,245
Commitments and contingencies		—			—
Stockholders’ equity
Common stock, $1.00 par value; 2,500,000 shares authorized; 1,250,375 and 1,246,062 shares issued and outstanding in 2010 and 2009, respectively		1,250,375			1,246,062
Additional paid-in capital		1,687,446			1,630,586
Retained earnings		24,226,667			24,208,695
Accumulated other comprehensive loss		(765,207	)		(479,015	)
Total stockholders’ equity		26,399,281			26,606,328
Total liabilities and stockholders’ equity	$	310,019,331		$	308,534,573

Botetourt Bankshares, Inc.

Consolidated Statements of Operations

For the Year Ended December 31, 2010 and 2009

	(Unaudited)		(Audited)
	2010		2009
Interest income
Loans and fees on loans	$	15,613,824	$	15,884,452
Federal funds sold		8,641		6,078
Investment securities:
Taxable		313,561		405,001
Exempt from federal income tax		240,750		276,197
Dividend income		2,143		2,485
Deposits with banks		23,124		1,853
Total interest income		16,202,043		16,576,066
Interest expense
Deposits		5,163,198		6,637,009
Federal funds purchased		—		1,651
Total interest expense		5,163,198		6,638,660
Net interest income		11,038,845		9,937,406
Provision for loan losses		3,235,000		1,790,000
Net interest income after provision for loan losses		7,803,845		8,147,406
Noninterest income
Service charges on deposit accounts		1,094,093		1,161,136
Other service charges and fees		213,254		188,553
Mortgage origination fees		201,505		202,497
Commissions on title services		48,996		71,074
Net realized gains on sales of securities		2,675		8,505
Other income		367,285		352,161
Total noninterest income		1,927,808		1,983,926
Noninterest expense
Salaries and employee benefits		4,877,701		4,780,653
Occupancy		535,881		553,485
Equipment		653,576		645,207
Foreclosed assets, net		379,020		219,805
Advertising and public relations		147,745		171,933
Outside services		352,427		303,095
FDIC insurance premiums and assessment		485,688		685,338
ATM and debit card		278,712		285,028
Franchise tax		193,918		193,732
Other general and administrative		1,351,648		1,292,177
Total noninterest expense		9,256,316		9,130,453
Income before income taxes		475,337		1,000,879
Income tax expense		58,154		236,805
Net income	$	417,183	$	764,074
Basic earnings per share	$	0.33	$	0.61
Diluted earnings per share	$	0.33	$	0.61
Basic weighted average shares outstanding		1,248,142		1,245,409
Diluted weighted average shares outstanding		1,248,142		1,245,409