American National Bankshares Inc. and Subsidiaries | ||||||
Consolidated Balance Sheets | ||||||
(Dollars in thousands, except share data) | ||||||
Unaudited | ||||||
September 30 | ||||||
ASSETS | 2008 | 2007 | ||||
Cash and due from banks | $ | 25,136 | $ | 20,016 | ||
Interest-bearing deposits in other banks | 8,050 | 24 | ||||
Securities available for sale, at fair value | 134,114 | 136,270 | ||||
Securities held to maturity | 7,133 | 12,009 | ||||
Total securities | 141,247 | 148,279 | ||||
Loans held for sale | 2,269 | 375 | ||||
Loans, net of unearned income | 576,598 | 554,002 | ||||
Less allowance for loan losses | (8,083 | ) | (7,334 | ) | ||
Net Loans | 568,515 | 546,668 | ||||
Premises and equipment, net | 16,825 | 13,197 | ||||
Goodwill | 22,468 | 22,468 | ||||
Core deposit intangibles, net | 2,169 | 2,546 | ||||
Accrued interest receivable and other assets | 13,966 | 13,981 | ||||
Total assets | $ | 800,645 | $ | 767,554 | ||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||
Liabilities: | ||||||
Demand deposits -- noninterest-bearing | $ | 102,065 | $ | 105,014 | ||
Demand deposits -- interest-bearing | 107,228 | 105,004 | ||||
Money market deposits | 56,574 | 52,271 | ||||
Savings deposits | 59,563 | 63,565 | ||||
Time deposits | 263,627 | 260,300 | ||||
Total deposits | 589,057 | 586,154 | ||||
Customer repurchase agreements | 44,951 | 48,665 | ||||
FHLB borrowings | 39,745 | 8,975 | ||||
Trust preferred capital notes | 20,619 | 20,619 | ||||
Accrued interest payable and other liabilities | 3,559 | 3,807 | ||||
Total liabilities | 697,931 | 668,220 | ||||
Shareholders' equity: | ||||||
Common stock, $1 par, 10,000,000 shares authorized, | ||||||
6,090,804 shares outstanding at September 30, 2008 and | ||||||
6,121,325 shares outstanding at Septembeer 30, 2007 | 6,091 | 6,121 | ||||
Capital in excess of par value | 26,439 | 26,364 | ||||
Retained earnings | 70,962 | 68,188 | ||||
Accumulated other comprehensive income (loss), net | (778 | ) | (1,339 | ) | ||
Total shareholders' equity | 102,714 | 99,334 | ||||
Total liabilities and shareholders' equity | $ | 800,645 | $ | 767,554 |
American National Bankshares Inc. and Subsidiaries | ||||||||||||
Consolidated Statements of Income | ||||||||||||
(Dollars in thousands, except share and per share data) | ||||||||||||
Unaudited | ||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||
September 30 | September 30 | |||||||||||
2008 | 2007 | 2008 | 2007 | |||||||||
Interest and Dividend Income: | ||||||||||||
Interest and fees on loans | $ | 8,916 | $ | 10,506 | $ | 27,347 | $ | 30,993 | ||||
Interest and dividends on securities: | ||||||||||||
Taxable | 1,179 | 1,060 | 3,644 | 3,224 | ||||||||
Tax-exempt | 388 | 416 | 1,240 | 1,259 | ||||||||
Dividends | 41 | 75 | 191 | 246 | ||||||||
Other interest income | 75 | 236 | 225 | 575 | ||||||||
Total interest and dividend income | 10,599 | 12,293 | 32,647 | 36,297 | ||||||||
Interest Expense: | ||||||||||||
Interest on deposits | 2,845 | 4,004 | 9,543 | 11,647 | ||||||||
Interest on customer repurchase agreements | 313 | 478 | 1,103 | 1,353 | ||||||||
Interest on other borrowings | 242 | 122 | 660 | 498 | ||||||||
Interest on trust preferred capital notes | 343 | 343 | 1,030 | 1,030 | ||||||||
Total interest expense | 3,743 | 4,947 | 12,336 | 14,528 | ||||||||
Net Interest Income | 6,856 | 7,346 | 20,311 | 21,769 | ||||||||
Provision for loan losses | 280 | - | 1,020 | 303 | ||||||||
Net Interest Income After Provision | ||||||||||||
for Loan Losses | 6,576 | 7,346 | 19,291 | 21,466 | ||||||||
Noninterest Income: | ||||||||||||
Trust fees | 901 | 861 | 2,697 | 2,664 | ||||||||
Service charges on deposit accounts | 603 | 631 | 1,769 | 1,878 | ||||||||
Other fees and commissions | 193 | 193 | 622 | 591 | ||||||||
Mortgage banking income | 238 | 240 | 633 | 759 | ||||||||
Brokerage fees | 126 | 191 | 370 | 439 | ||||||||
Securities gains (losses), net | (87 | ) | 45 | (195 | ) | 134 | ||||||
Impairment of securities | - | - | (255 | ) | - | |||||||
Other | 88 | 115 | 397 | 454 | ||||||||
Total noninterest income | 2,062 | 2,276 | 6,038 | 6,919 | ||||||||
Noninterest Expense: | ||||||||||||
Salaries | 2,466 | 2,380 | 7,416 | 7,284 | ||||||||
Employee benefits | 688 | 779 | 2,212 | 2,164 | ||||||||
Occupancy and equipment | 898 | 881 | 2,792 | 2,560 | ||||||||
Bank franchise tax | 172 | 165 | 522 | 498 | ||||||||
Core deposit intangible amortization | 94 | 94 | 283 | 283 | ||||||||
Other | 1,167 | 1,080 | 3,352 | 3,208 | ||||||||
Total noninterest expense | 5,485 | 5,379 | 16,577 | 15,997 | ||||||||
Income Before Income Taxes | 3,153 | 4,243 | 8,752 | 12,388 | ||||||||
Income Taxes | 929 | 1,309 | 2,414 | 3,719 | ||||||||
Net Income | $ | 2,224 | $ | 2,934 | $ | 6,338 | $ | 8,669 | ||||
Net Income Per Common Share: | ||||||||||||
Basic | $ | 0.36 | $ | 0.48 | $ | 1.04 | $ | 1.41 | ||||
Diluted | $ | 0.36 | $ | 0.48 | $ | 1.04 | $ | 1.40 | ||||
Average Common Shares Outstanding: | ||||||||||||
Basic | 6,093,851 | 6,132,288 | 6,099,933 | 6,146,349 | ||||||||
Diluted | 6,100,089 | 6,151,750 | 6,109,947 | 6,171,243 |
Financial Highlights | |||||||||||||||
American National Bankshares Inc. and Subsidiaries | |||||||||||||||
Dollars in thousands, except share data | |||||||||||||||
Unaudited | |||||||||||||||
3rd Qtr | 2nd Qtr | 3rd Qtr | YTD | YTD | |||||||||||
2008 | 2008 | 2007 | 2008 | 2007 | |||||||||||
EARNINGS | |||||||||||||||
Interest income | $ | 10,599 | $ | 10,788 | $ | 12,293 | $ | 32,647 | $ | 36,297 | |||||
Interest expense | 3,743 | 4,058 | 4,947 | 12,336 | 14,528 | ||||||||||
Net interest income | 6,856 | 6,730 | 7,346 | 20,311 | 21,769 | ||||||||||
Provision for loan losses | 280 | 600 | - | 1,020 | 303 | ||||||||||
Noninterest income | 2,062 | 1,841 | 2,276 | 6,038 | 6,919 | ||||||||||
Noninterest expense | 5,485 | 5,643 | 5,379 | 16,577 | 15,997 | ||||||||||
Income taxes | 929 | 519 | 1,309 | 2,414 | 3,719 | ||||||||||
Net income | 2,224 | 1,809 | 2,934 | 6,338 | 8,669 | ||||||||||
PER COMMON SHARE | |||||||||||||||
Earnings per share - basic | $ | 0.36 | $ | 0.30 | $ | 0.48 | $ | 1.04 | $ | 1.41 | |||||
Earnings per share - diluted | 0.36 | 0.30 | 0.48 | 1.04 | 1.40 | ||||||||||
Cash dividends declared | 0.23 | 0.23 | 0.23 | 0.69 | 0.68 | ||||||||||
Book value per share | 16.86 | 16.71 | 16.23 | 16.86 | 16.23 | ||||||||||
Book value per share - tangible (a) | 12.82 | 12.65 | 12.14 | 12.82 | 12.14 | ||||||||||
Closing market price | 18.00 | 18.25 | 22.22 | 18.00 | 22.22 | ||||||||||
FINANCIAL RATIOS | |||||||||||||||
Return on average assets | 1.13 | % | 0.92 | % | 1.52 | % | 1.08 | % | 1.49 | % | |||||
Return on average equity | 8.72 | 7.06 | 11.98 | 8.26 | 11.92 | ||||||||||
Return on average tangible equity (b) | 11.84 | 9.69 | 16.46 | 11.25 | 16.46 | ||||||||||
Average equity to average assets | 12.97 | 12.99 | 12.68 | 13.02 | 12.53 | ||||||||||
Net interest margin, taxable equivalent | 3.90 | 3.83 | 4.27 | 3.87 | 4.22 | ||||||||||
Efficiency ratio | 59.51 | 61.40 | 54.89 | 60.33 | 54.73 | ||||||||||
Effective tax rate | 29.46 | 22.29 | 30.85 | 27.58 | 30.02 | ||||||||||
PERIOD-END BALANCES | |||||||||||||||
Securities | $ | 141,247 | $ | 146,460 | $ | 148,279 | $ | 141,247 | $ | 148,279 | |||||
Loans held for sale | 2,269 | 2,200 | 375 | 2,269 | 375 | ||||||||||
Loans, net of unearned income | 576,598 | 568,830 | 554,002 | 576,598 | 554,002 | ||||||||||
Goodwill and other intangibles | 24,637 | 24,732 | 25,014 | 24,637 | 25,014 | ||||||||||
Assets | 800,645 | 790,695 | 767,554 | 800,645 | 767,554 | ||||||||||
Assets - tangible (a) | 776,008 | 765,963 | 742,540 | 776,008 | 742,540 | ||||||||||
Deposits | 589,057 | 569,244 | 586,154 | 589,057 | 586,154 | ||||||||||
Customer repurchase agreements | 44,951 | 57,973 | 48,665 | 44,951 | 48,665 | ||||||||||
Borrowings | 60,364 | 58,107 | 29,594 | 60,364 | 29,594 | ||||||||||
Shareholders' equity | 102,714 | 101,896 | 99,334 | 102,714 | 99,334 | ||||||||||
Shareholders' equity - tangible (a) | 78,077 | 77,164 | 74,320 | 78,077 | 74,320 | ||||||||||
AVERAGE BALANCES | |||||||||||||||
Securities | $ | 141,697 | $ | 150,247 | $ | 141,296 | $ | 147,863 | $ | 147,069 | |||||
Loans held for sale | 1,986 | 2,206 | 1,940 | 1,936 | 2,055 | ||||||||||
Loans, net of unearned income | 572,196 | 564,769 | 547,465 | 563,667 | 545,923 | ||||||||||
Interest-earning assets | 724,368 | 725,789 | 708,794 | 722,619 | 709,807 | ||||||||||
Goodwill and other intangibles | 24,695 | 24,785 | 25,052 | 24,781 | 25,146 | ||||||||||
Assets | 786,804 | 789,412 | 772,060 | 785,372 | 773,784 | ||||||||||
Assets - tangible (a) | 762,109 | 764,627 | 747,008 | 760,591 | 748,638 | ||||||||||
Interest-bearing deposits | 480,133 | 476,207 | 487,427 | 480,806 | 489,496 | ||||||||||
Deposits | 577,263 | 576,167 | 590,904 | 578,922 | 591,445 | ||||||||||
Customer repurchase agreements | 51,038 | 53,535 | 48,427 | 53,069 | 46,912 | ||||||||||
Borrowings | 52,063 | 52,012 | 29,932 | 46,003 | 33,487 | ||||||||||
Shareholders' equity | 102,052 | 102,511 | 97,927 | 102,290 | 96,961 | ||||||||||
Shareholders' equity - tangible (a) | 77,357 | 77,726 | 72,875 | 77,509 | 71,815 | ||||||||||
CAPITAL | |||||||||||||||
Average shares outstanding - basic | 6,093,851 | 6,098,184 | 6,132,288 | 6,099,933 | 6,146,349 | ||||||||||
Average shares outstanding - diluted | 6,100,089 | 6,108,536 | 6,151,750 | 6,109,947 | 6,171,243 | ||||||||||
Shares repurchased | 7,850 | 2,400 | 28,900 | 39,050 | 53,200 | ||||||||||
Average price of shares repurchased | $ | 17.42 | $ | 21.43 | $ | 21.19 | $ | 20.16 | $ | 21.97 |
Financial Highlights | |||||||||||||||
American National Bankshares Inc. and Subsidiaries | |||||||||||||||
(Dollars in thousands, except share data) | |||||||||||||||
Unauditied | |||||||||||||||
3rd Qtr | 2nd Qtr | 3rd Qtr | YTD | YTD | |||||||||||
2008 | 2008 | 2007 | 2008 | 2007 | |||||||||||
ALLOWANCE FOR LOAN LOSSES | |||||||||||||||
Beginning balance | $ | 7,932 | $ | 7,425 | $ | 7,493 | $ | 7,395 | $ | 7,264 | |||||
Provision for loan losses | 280 | 600 | - | 1,020 | 303 | ||||||||||
Charge-offs | (179 | ) | (203 | ) | (227 | ) | (552 | ) | (431 | ) | |||||
Recoveries | 50 | 110 | 68 | 220 | 198 | ||||||||||
Ending balance | $ | 8,083 | $ | 7,932 | $ | 7,334 | $ | 8,083 | $ | 7,334 | |||||
LOANS | |||||||||||||||
Construction and land development | $ | 65,826 | $ | 66,740 | $ | 69,476 | $ | 65,826 | $ | 69,476 | |||||
Commercial real estate | 208,046 | 201,102 | 205,048 | 208,046 | 205,048 | ||||||||||
Residential real estate | 139,683 | 140,024 | 133,476 | 139,683 | 133,476 | ||||||||||
Home equity | 55,665 | 52,773 | 46,671 | 55,665 | 46,671 | ||||||||||
Commercial and industrial | 99,139 | 99,603 | 88,638 | 99,139 | 88,638 | ||||||||||
Consumer | 8,239 | 8,588 | 10,693 | 8,239 | 10,693 | ||||||||||
Total | $ | 576,598 | $ | 568,830 | $ | 554,002 | $ | 576,598 | $ | 554,002 | |||||
NONPERFORMING ASSETS AT PERIOD-END | |||||||||||||||
Nonperforming loans: | |||||||||||||||
90 days past due | $ | - | $ | 172 | $ | 157 | $ | - | $ | 157 | |||||
Nonaccrual | 6,674 | 6,216 | 2,454 | 6,674 | 2,454 | ||||||||||
Foreclosed real estate | 707 | 558 | 632 | 707 | 632 | ||||||||||
Nonperforming assets | $ | 7,381 | $ | 6,946 | $ | 3,243 | $ | 7,381 | $ | 3,243 | |||||
ASSET QUALITY RATIOS | |||||||||||||||
Annualized net chargeoffs to average loans | 0.09 | % | 0.07 | % | 0.12 | % | 0.08 | % | 0.06 | % | |||||
Nonperforming assets to total assets | 0.92 | 0.88 | 0.42 | 0.92 | 0.42 | ||||||||||
Nonperforming loans to total loans | 1.16 | 1.12 | 0.47 | 1.16 | 0.47 | ||||||||||
Allowance for loan losses to total loans | 1.40 | 1.39 | 1.32 | 1.40 | 1.32 | ||||||||||
Allowance for loan losses to nonperfoming loans | 121.11 | 124.17 | 280.89 | 121.11 | 280.89 | ||||||||||
OTHER DATA | |||||||||||||||
Fiduciary assets at period-end (c) | $ | 368,341 | $ | 377,008 | $ | 405,735 | $ | 368,341 | $ | 405,735 | |||||
Retail brokerage assets at period-end (c) | $ | 91,026 | $ | 94,472 | $ | 98,820 | $ | 91,026 | $ | 98,820 | |||||
Number full time-time equivalent employees | 258 | 261 | 260 | 258 | 260 | ||||||||||
Number of full service offices | 20 | 20 | 19 | 20 | 19 | ||||||||||
Number of loan production offices | 1 | 1 | 1 | 1 | 1 | ||||||||||
Number of ATM's | 23 | 23 | 23 | 23 | 23 | ||||||||||
Notes: | |||||||||||||||
(a) - Excludes goodwill and other intangible assets | |||||||||||||||
(b) - Excludes amortization expense, net of tax, of intangible assets | |||||||||||||||
(c) - Market value |
Net Interest Income Analysis | ||||||||||||||||||
For the Three Months Ended September 30, 2008 and 2007 | ||||||||||||||||||
(in thousands, except rates) | ||||||||||||||||||
Interest | ||||||||||||||||||
Average Balance | Income/Expense | Yield/Rate | ||||||||||||||||
2008 | 2007 | 2008 | 2007 | 2008 | 2007 | |||||||||||||
Loans: | ||||||||||||||||||
Commercial | $ | 94,575 | $ | 89,531 | $ | 1,423 | $ | 1,774 | 6.02 | % | 7.93 | % | ||||||
Real estate | 471,162 | 449,172 | 7,323 | 8,496 | 6.22 | 7.57 | ||||||||||||
Consumer | 8,445 | 10,702 | 192 | 253 | 9.09 | 9.46 | ||||||||||||
Total loans | 574,182 | 549,405 | 8,938 | 10,523 | 6.23 | 7.66 | ||||||||||||
Securities: | ||||||||||||||||||
Federal agencies | 43,543 | 64,738 | 534 | 732 | 4.91 | 4.52 | ||||||||||||
Mortgage-backed | 48,000 | 24,489 | 607 | 304 | 5.06 | 4.97 | ||||||||||||
State and municipal | 44,104 | 45,414 | 602 | 624 | 5.46 | 5.50 | ||||||||||||
Other | 6,050 | 6,555 | 54 | 97 | 3.57 | 5.83 | ||||||||||||
Total securities | 141,697 | 141,296 | 1,797 | 1,757 | 5.07 | 4.97 | ||||||||||||
Deposits in other banks | 8,489 | 18,093 | 75 | 236 | 3.53 | 5.22 | ||||||||||||
Total interest-earning assets | 724,368 | 708,794 | 10,810 | 12,516 | 5.97 | 7.06 | ||||||||||||
�� | ||||||||||||||||||
Non-earning assets | 62,436 | 63,266 | ||||||||||||||||
Total assets | $ | 786,804 | $ | 772,060 | ||||||||||||||
Deposits: | ||||||||||||||||||
Demand | $ | 110,230 | $ | 107,259 | 215 | 405 | 0.78 | 1.51 | ||||||||||
Money market | 54,642 | 54,203 | 246 | 379 | 1.80 | 2.80 | ||||||||||||
Savings | 60,499 | 65,162 | 76 | 220 | 0.50 | 1.35 | ||||||||||||
Time | 254,762 | 260,803 | 2,308 | 3,000 | 3.62 | 4.60 | ||||||||||||
Total deposits | 480,133 | 487,427 | 2,845 | 4,004 | 2.37 | 3.29 | ||||||||||||
Repurchase agreements | 51,038 | 48,427 | 313 | 478 | 2.45 | 3.95 | ||||||||||||
Other borrowings | 52,063 | 29,932 | 585 | 465 | 4.49 | 6.21 | ||||||||||||
Total interest-bearing | ||||||||||||||||||
liabilities | 583,234 | 565,786 | 3,743 | 4,947 | 2.57 | 3.50 | ||||||||||||
Noninterest bearing | ||||||||||||||||||
demand deposits | 97,130 | 103,477 | ||||||||||||||||
Other liabilities | 4,388 | 4,870 | ||||||||||||||||
Shareholders' equity | 102,052 | 97,927 | ||||||||||||||||
Total liabilities and | ||||||||||||||||||
shareholders' equity | $ | 786,804 | $ | 772,060 | ||||||||||||||
Interest rate spread | 3.40 | % | 3.56 | % | ||||||||||||||
Net interest margin | 3.90 | % | 4.27 | % | ||||||||||||||
Net interest income (taxable equivalent basis) | 7,067 | 7,569 | ||||||||||||||||
Less: Taxable equivalent adjustment | 211 | 223 | ||||||||||||||||
Net interest income | $ | 6,856 | $ | 7,346 |
Net Interest Income Analysis | ||||||||||||||||||
For the Nine Months Ended September 30, 2008 and 2007 | ||||||||||||||||||
(in thousands, except rates) | ||||||||||||||||||
Interest | ||||||||||||||||||
Average Balance | Income/Expense | Yield/Rate | ||||||||||||||||
2008 | 2007 | 2008 | 2007 | 2008 | 2007 | |||||||||||||
Loans: | ||||||||||||||||||
Commercial | $ | 90,301 | $ | 90,117 | $ | 4,219 | $ | 5,286 | 6.23 | % | 7.82 | % | ||||||
Real estate | 466,346 | 447,366 | 22,580 | 25,025 | 6.46 | 7.46 | ||||||||||||
Consumer | 8,956 | 10,495 | 606 | 742 | 9.02 | 9.43 | ||||||||||||
Total loans | 565,603 | 547,978 | 27,405 | 31,053 | 6.46 | 7.56 | ||||||||||||
Securities: | ||||||||||||||||||
Federal agencies | 46,428 | 71,931 | 1,682 | 2,337 | 4.83 | 4.33 | ||||||||||||
Mortgage-backed | 48,588 | 21,680 | 1,852 | 792 | 5.08 | 4.87 | ||||||||||||
State and municipal | 46,376 | 45,664 | 1,910 | 1,886 | 5.49 | 5.51 | ||||||||||||
Other | 6,471 | 7,794 | 243 | 342 | 5.01 | 5.85 | ||||||||||||
Total securities | 147,863 | 147,069 | 5,687 | 5,357 | 5.13 | 4.86 | ||||||||||||
Deposits in other banks | 9,153 | 14,760 | 225 | 575 | 3.28 | 5.19 | ||||||||||||
Total interest-earning assets | 722,619 | 709,807 | 33,317 | 36,985 | 6.15 | 6.95 | ||||||||||||
Non-earning assets | 62,753 | 63,977 | ||||||||||||||||
Total assets | $ | 785,372 | $ | 773,784 | ||||||||||||||
Deposits: | ||||||||||||||||||
Demand | $ | 108,463 | $ | 109,469 | 600 | 1,245 | 0.74 | 1.52 | ||||||||||
Money market | 52,365 | 52,881 | 779 | 1,084 | 1.98 | 2.73 | ||||||||||||
Savings | 62,107 | 67,255 | 276 | 685 | 0.59 | 1.36 | ||||||||||||
Time | 257,871 | 259,891 | 7,888 | 8,633 | 4.08 | 4.43 | ||||||||||||
Total deposits | 480,806 | 489,496 | 9,543 | 11,647 | 2.65 | 3.17 | ||||||||||||
Repurchase agreements | 53,069 | 46,912 | 1,103 | 1,353 | 2.77 | 3.85 | ||||||||||||
Other borrowings | 46,003 | 33,487 | 1,690 | 1,528 | 4.90 | 6.08 | ||||||||||||
Total interest-bearing | ||||||||||||||||||
liabilities | 579,878 | 569,895 | 12,336 | 14,528 | 2.84 | 3.40 | ||||||||||||
Noninterest bearing | ||||||||||||||||||
demand deposits | 98,116 | 101,949 | ||||||||||||||||
Other liabilities | 5,088 | 4,979 | ||||||||||||||||
Shareholders' equity | 102,290 | 96,961 | ||||||||||||||||
Total liabilities and | ||||||||||||||||||
shareholders' equity | $ | 785,372 | $ | 773,784 | ||||||||||||||
Interest rate spread | 3.31 | % | 3.55 | % | ||||||||||||||
Net interest margin | 3.87 | % | 4.22 | % | ||||||||||||||
Net interest income (taxable equivalent basis) | 20,981 | 22,457 | ||||||||||||||||
Less: Taxable equivalent adjustment | 670 | 688 | ||||||||||||||||
Net interest income | $ | 20,311 | $ | 21,769 |