EXHIBIT 99.1
| Tri City Bankshares Corporation |
| Quarterly Brochure Financial Data |
| INCOME STATEMENT (unaudited) |
| | | Three Months Ended | |
| | | 03/31/11 | | | 03/31/10 | |
| Interest Income | | $ | 12,843,229 | | | $ | 16,550,415 | |
| Interest Expense | | | 1,327,722 | | | | 1,552,814 | |
| Net Interest Income | | | 11,515,507 | | | | 14,997,601 | |
| Other Income | | | 3,375,974 | | | | 4,424,987 | |
| Less: Provision for loan losses | | | 1,400,000 | | | | 1,780,000 | |
| Other Operating Expenses | | | 10,331,509 | | | | 10,094,466 | |
| Total Income before taxes | | | 3,159,972 | | | | 7,548,122 | |
| Provision for Income Taxes | | | 874,286 | | | | 2,851,500 | |
| Net Income | | $ | 2,285,686 | | | $ | 4,696,622 | |
| Net Income Per Common Share | | $ | 0.26 | | | $ | 0.53 | |
| | | | | | | | | |
| BALANCE SHEET (unaudited) March 31, 2011 and 2010 | |
| Assets | | 2011 | | | 2010 | | Liabilities & Equity | | 2011 | | | 2010 | |
| Cash and Due from Banks | | $ | 26,016,350 | | | $ | 26,795,481 | | Non Interest Bearing | | $ | 163,902,907 | | | $ | 151,597,233 | |
| Investment Securities | | | 306,927,406 | | | | 233,749,402 | | Interest Bearing | | | 838,142,237 | | | | 812,707,716 | |
| Federal Funds Sold | | | 16,868,792 | | | | 13,723,640 | | Total Deposits | | | 1,002,045,144 | | | | 964,304,949 | |
| Total Loans | | | 735,222,767 | | | | 782,366,055 | | Short Term Debt | | | 1,604,747 | | | | 1,442,940 | |
| Allowance for Loan Losses | | | (9,870,254 | ) | | | (7,567,450 | ) | Other Liabilities | | | 3,444,381 | | | | 12,960,262 | |
| Net Loans | | | 725,352,513 | | | | 774,798,605 | | Total Liabilities | | | 1,007,094,272 | | | | 978,708,151 | |
| Bank Premises & Equipment | | | 20,083,651 | | | | 19,793,657 | | Common Stock | | | 8,904,915 | | | | 8,904,915 | |
| Other Real Estate Owned | | | 5,568,336 | | | | 4,682,446 | | Additional Paid-In Capital | | | 26,543,470 | | | | 26,543,470 | |
| Cash surrender value of life insurance | | | 12,138,797 | | | | 11,668,013 | | Retained Earnings | | | 81,171,857 | | | | 87,973,070 | |
| Other Assets | | | 10,758,669 | | | | 16,918,362 | | Total Stockholders' Equity | | | 116,620,242 | | | | 123,421,455 | |
| Total Assets | | $ | 1,123,714,514 | | | $ | 1,102,129,606 | | Total Liabilities & Equity | | $ | 1,123,714,514 | | | $ | 1,102,129,606 | |
EXHIBIT 99.1 (cont’d)
Management Comments
The Corporation posted net income of $2.3 million for the first quarter of 2011, a decrease of $2.5 million or 51.3% compared to the first quarter of 2010. Earnings per share decreased to $0.26 for the three months ended March 31, 2011 compared to $0.53 for the same period in 2010.
The decrease in earnings was due to a $3.5 million decrease in net interest income to $11.5 million for the three months ended March 31, 2011 compared $15.0 million for the same period in 2010. The decrease was the result of lower rates and a volume shift from loans to investment securities. The decrease attributable to rate was $3.5 million. The decrease attributable to the volume shift of earning assets was $0.3 million and was offset by a matching $0.3 million reduction in interest expense as a result of lower rates.
Volume reduction in loan balances occurs as substandard loans acquired from the FDIC in October 2009 are eliminated at a pace faster than new business is achieved. This necessitates redeployment of these funds to investment securities. Reinvestment in today’s rate environment produces relatively low yielding investments which also negatively impact the net interest margin. In addition, the provision for loan losses decreased $0.4 million while other income and other operating expenses remained unchanged.
Operating earnings during the first quarter were also negatively affected by a decrease in acquisition related purchase accounting income. These items, which totaled $1.4 million in 2011 compared to $4.6 million in 2010, impact the net interest margin, other income and other operating expenses.
Total assets were $1.1 billion at March 31, 2011 and March 31, 2010. While total assets remained stable, total loans decreased $47.1 million during the last twelve months and deposits increased $37.7 million during the same period. The excess liquidity created by the fluctuations in loans and deposits resulted in an increase in the investment portfolio of $73.2 million
Dividend Announcement
The Board of Directors did not declare a dividend for the second quarter of 2011.
As previously announced, the Board of Directors declared a special dividend of $1.20 per share payable on December 10th, 2010 to shareholders as of the record date of November 30th, 2010. This dividend was intended to prepay 2011 dividends due to the possibility of less favorable tax treatment of dividend income in 2011.
As a result of the dividend paid in December of 2010, the Board intends to significantly reduce or eliminate dividend payments for the remainder of 2011. The Board intends to resume quarterly dividend payments after 2011, however it is not possible to predict the economy in 2012. The Board will review earnings, monitor regulatory developments and consider other appropriate factors at that time relative to declaring future dividends.
