OLD POINT FINANCIAL CORPORATION ANNOUNCES
THIRD QUARTER 2005 EARNINGS
October 18, 2005, Hampton, VA Old Point Financial Corporation (Nasdaq “OPOF”) announced today that its assets rose to $728.2 million, a 5% increase over September 30, 2004 assets of $692 million. Net loans increased by 10% to $466.2 million. Net income for the quarter was $1.7 million and $5.6 million for the nine months ending September 30 2005, as compared with third quarter 2004 net income of $2.1 million and $6.5 million for the first nine months of 2004. Basic earnings per share were $.43 for the quarter and $1.40 year-to-date. Diluted earnings per share for the same periods were $.42 and $1.38, respectively.
“We are building for the future,” saidRobert F. Shuford, Chairman President and CEO of Old Point Financial Corporation. “We have increased staff by twenty people since last year. The additional positions are to staff and support three new branches that either are already open, or will open within the next few months. In fact, our investment has already begun to pay off – net loans grew by $33 million during the third quarter. “ The Independence office in the Town Center area of Virginia Beach is now open. The office, the eighteenth location for Old Point National Bank, also is home to a commercial lending staff. The nineteenth office, in the Eagle Harbor section of Isle of Wight County, should open in early 2006. Eagle Harbor will be the third new office to open within a twelve month period.
Net interest income has declined due to a significant increase in the cost of deposits and other funding sources. While short term interest rates have risen dramatically in the past twelve months, longer term rates have remained fairly stable. This compression of the yield curve has put pressure on the net interest margin.
Other factors affecting earnings are a significant increase in salaries and employee expenses and an increase in Marketing expenses associated with a front-end loaded consumer deposit strategy. In addition, as a publicly traded company on NASDAQ, Old Point Financial Corporation is subject to the requirements of the Sarbanes Oxley Act (SOX), which requires companies to ensure compliance with stringent internal control procedures. Old Point has committed significant resources to comply with Sarbanes Oxley.
Return on Average Assets (ROA) for year-to-date 2005 is 1.08%, and Return on Average Equity (ROE) is 10.69%.
Old Point Financial Corporation, ("OPOF" - Nasdaq SmallCap Market) is the parent company ofOld Point National Bank, a locally owned and managed community bank serving Hampton Roads with a 18-branch network extending from Chesapeake through James City County, andOld Point Trust & Financial Services, N.A., a Hampton Roads wealth management services provider. Web:www.oldpoint.com
For more information contact: Lani Chisman Davis, Marketing Director, 757/728-1286
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| Old Point Financial Corporation | | |
| Consolidated Balance Sheets | | |
| Unaudited | | |
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| | (in thousands, except per share data) |
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| Assets |
| | 30-Sep-05 | 30-Sep-04 |
| Cash and due from banks | $ 18,968 | $ 19,483 |
| Federal funds sold | 7,022 | 17,986 |
| Cash and cash equivalents | 25,990 | 37,469 |
| Securities available-for-sale, at fair value | 194,883 | 188,202 |
| Securities held-to-maturity | | |
| (fair value approximates $3,161 and $9,542) | 3,115 | 9,224 |
| Loans, net of allowance for loan losses of | | |
| $4,245 and $4,671 | 466,162 | 424,561 |
| Premises and equipment, net | 20,569 | 17,710 |
| Other Assets | 17,527 | 14,855 |
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| Total Assets | $ 728,246 | $ 692,021 |
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| Liabilities & Stockholders' Equity |
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| Deposits: |
| Noninterest-bearing deposits | $ 112,673 | $ 110,010 |
| Savings deposits | 190,650 | 195,765 |
| Time deposits | 227,664 | 216,019 |
| Total deposits | 530,987 | 521,794 |
| Federal funds purchased, repurchase agreements |
| and other borrowings | 54,001 | 39,287 |
| Federal Home Loan Bank Advances | 70,000 | 60,000 |
| Accrued expenses and other liabilities | 2,079 | 3,080 |
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| Total Liabilities | 657,067 | 624,161 |
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| Stockholders' Equity |
| Common stock, $5.00 par value | 20,081 | 20,026 |
| 2005 2004 |
| Shares Authorized 10,000,000 10,000,000 |
| Shares Outstanding 4,016,290 4,005,172 | |
| Additional paid-in capital | 14,160 | 13,600 |
| Retained earnings | 38,437 | 33,741 |
| Accumulated other comprehensive income(loss) | (1,499) | 493 |
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| Total stockholders' equity | 71,179 | 67,860 |
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| Total liabilities and stockholders' equity | $ 728,246 | $ 692,021 |
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| Old Point Financial Corporation |
| Consolidated Statements of Income |
| Unaudited |
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| | (in thousands, except per share data) |
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| Interest and Dividend Income: | | | | 3 Months Ended | | | 3 Months Ended | | | 9 Months Ended | | | 9 Months Ended | |
| | | | | 30-Sep-05 | | | 30-Sep-04 | | | 30-Sep-05 | | | 30-Sep-04 | |
| Interest and fees on loans | | | $ | 7,324 | | $ | 6,704 | | $ | 20,987 | | $ | 19,541 | |
| Interest on federal funds sold | | | | 124 | | | 45 | | | 210 | | | 106 | |
| Interest on securities: | | |
| Taxable | | | | 1,309 | | | 1,293 | | | 3,997 | | | 3,805 | |
| Tax-exempt | | | | 428 | | | 461 | | | 1,298 | | | 1,432 | |
| Dividends and interest on all other securities | | | | 50 | | | 42 | | | 155 | | | 106 | |
| Total interest and dividend income | | | | 9,235 | | | 8,545 | | | 26,647 | | | 24,990 | |
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| Interest Expense: | | |
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| Interest on savings deposits | | | | 370 | | | 261 | | | 1,034 | | | 735 | |
| Interest on time deposits | | | | 1,805 | | | 1,409 | | | 4,888 | | | 4,164 | |
| Interest on federal funds purchased, securities | | | | 291 | | | 82 | | | 793 | | | 223 | |
| sold under agreement to repurchase and other |
| borrowings |
| Interest on Federal Home Loan Bank advances | | | | 740 | | | 587 | | | 1,875 | | | 1,673 | |
| Total interest expense | | | | 3,206 | | | 2,339 | | | 8,590 | | | 6,795 | |
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| Net interest income | | | | 6,029 | | | 6,206 | | | 18,057 | | | 18,195 | |
| Provision for loan losses | | | | 300 | | | 300 | | | 750 | | | 650 | |
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| Net interest income after provision for loan losses | | | | 5,729 | | | 5,906 | | | 17,307 | | | 17,545 | |
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| Noninterest Income: |
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| Income from fiduciary activities | | | | 659 | | | 622 | | | 2,072 | | | 1,934 | |
| Service charges on deposit accounts | | | | 1,285 | | | 1,174 | | | 3,543 | | | 3,199 | |
| Other service charges, commissions and fees | | | | 456 | | | 411 | | | 1,355 | | | 1,191 | |
| Income from bank owned life insurance | | | | 130 | | | 116 | | | 377 | | | 342 | |
| Gains (loss) on available-for-sale securities, net | | | | 1 | | | 12 | | | 10 | | | 211 | |
| Other operating income | | | | 143 | | | 80 | | | 374 | | | 242 | |
| Total noninterest income | | | | 2,674 | | | 2,415 | | | 7,731 | | | 7,119 | |
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| Noninterest Expense: | | |
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| Salaries and employee benefits | | | | 3,690 | | | 3,346 | | | 10,665 | | | 9,814 | |
| Occupancy and equipment | | | | 818 | | | 762 | | | 2,320 | | | 2,227 | |
| Supplies | | | | 127 | | | 114 | | | 361 | | | 315 | |
| Postage and courier | | | | 123 | | | 122 | | | 357 | | | 338 | |
| Service fees | | | | 195 | | | 212 | | | 472 | | | 433 | |
| Data processing | | | | 156 | | | 140 | | | 450 | | | 442 | |
| Marketing | | | | 218 | | | 77 | | | 469 | | | 279 | |
| Customer development | | | | 148 | | | 102 | | | 413 | | | 291 | |
| Employee professional development | | | | 128 | | | 113 | | | 408 | | | 361 | |
| Other | | | | 483 | | | 444 | | | 1,451 | | | 1,307 | |
| Total noninterest expenses | | | | 6,086 | | | 5,432 | | | 17,366 | | | 15,807 | |
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| Income before income taxes | | | | 2,317 | | | 2,889 | | | 7,672 | | | 8,857 | |
| Income tax expense | | | | 596 | | | 796 | | | 2,040 | | | 2,365 | |
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| Net income | | | $ | 1,721 | | $ | 2,093 | | $ | 5,632 | | $ | 6,492 | |
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| Basic Earnings Per Share |
| Average shares outstanding | | | | 4,016,070 | | | 4,001,129 | | | 4,015,866 | | | 3,993,011 | |
| Net income per share of common stock | | | $ | 0.43 | | $ | 0.52 | | $ | 1.40 | | $ | 1.63 | |
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| Diluted Earnings Per Share |
| Average shares outstanding | | | | 4,090,201 | | | 4,082,777 | | | 4,096,010 | | | 4,081,809 | |
| Net income per share of common stock | | | $ | 0.42 | | $ | 0.51 | | $ | 1.38 | | $ | 1.59 | |
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| Cash Dividends Declared | | | $ | 0.17 | | $ | 0.16 | | $ | 0.49 | | $ | 0.46 | |
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