American National Bankshares (AMNB) 8-K American National Bankshares Inc. Reports First Quarter 2015 Earnings

American National Bankshares Inc. and Subsidiaries
Consolidated Balance Sheets
(Dollars in thousands, except share and per share data)
Unaudited
	March 31
ASSETS	2015			2014
Cash and due from banks	$	23,995		$	25,880
Interest-bearing deposits in other banks		75,254			45,466
Federal funds sold		13,616			-
Securities available for sale, at fair value		352,208			349,123
Restricted stock, at cost		5,336			4,529
Loans held for sale		1,936			1,389
Loans		965,902			783,369
Less allowance for loan losses		(12,844	)		(12,614	)
Net Loans		953,058			770,755
Premises and equipment, net		24,371			23,359
Other real estate owned, net		2,653			3,233
Goodwill		44,210			39,043
Core deposit intangibles, net		3,583			2,828
Bank owned life insurance		17,261			14,845
Accrued interest receivable and other assets		22,617			19,352
Total assets	$	1,540,098		$	1,299,802
Liabilities
Demand deposits -- noninterest-bearing	$	289,818		$	218,795
Demand deposits -- interest-bearing		229,721			170,894
Money market deposits		202,706			194,528
Savings deposits		110,104			89,024
Time deposits		410,326			378,008
Total deposits		1,242,675			1,051,249
Short-term borrowings:
Customer repurchase agreements		53,664			34,153
Other short-term borrowings		-			-
Long-term borrowings		9,941			9,919
Trust preferred capital notes		27,546			27,444
Accrued interest payable and other liabilities		9,583			6,538
Total liabilities		1,343,409			1,129,303
Shareholders' equity
Preferred stock, $5 par, 2,000,000 shares authorized,
none outstanding		-			-
Common stock, $1 par, 10,000,000 shares authorized,
8,727,696 shares outstanding at March 31, 2015 and
7,905,243 shares outstanding at March 31, 2014		8,710			7,905
Capital in excess of par value		77,612			58,202
Retained earnings		106,102			100,721
Accumulated other comprehensive income, net		4,265			3,671
Total shareholders' equity		196,689			170,499
Total liabilities and shareholders' equity	$	1,540,098		$	1,299,802

American National Bankshares Inc. and Subsidiaries
Consolidated Statements of Income
(Dollars in thousands, except share and per share data)
Unaudited
	Three Months Ended
	March 31
	2015			2014
Interest and Dividend Income:
Interest and fees on loans	$	11,770		$	9,847
Interest on federal funds sold		4			-
Interest and dividends on securities:
Taxable		975			964
Tax-exempt		960			1,035
Dividends		82			75
Other interest income		48			33
Total interest and dividend income		13,839			11,954
Interest Expense:
Interest on deposits		1,194			1,229
Interest on short-term borrowings		3			2
Interest on long-term borrowings		80			80
Interest on trust preferred capital notes		184			184
Total interest expense		1,461			1,495
Net Interest Income		12,378			10,459
Provision for loan losses		600			-
Net Interest Income After Provision
for Loan Losses		11,778			10,459
Noninterest Income:
Trust fees		952			1,122
Service charges on deposit accounts		497			413
Other fees and commissions		588			444
Mortgage banking income		222			263
Securities gains, net		310			39
Other		587			422
Total noninterest income		3,156			2,703
Noninterest Expense:
Salaries		4,147			3,538
Employee benefits		1,075			975
Occupancy and equipment		1,172			936
FDIC assessment		185			164
Bank franchise tax		235			222
Core deposit intangible amortization		301			331
Data processing		462			348
Software		283			262
Foreclosed real estate, net		(5	)		16
Merger related expenses		359			-
Other		1,833			1,631
Total noninterest expense		10,047			8,423
Income Before Income Taxes		4,887			4,739
Income Taxes		1,372			1,289
Net Income	$	3,515		$	3,450
Net Income Per Common Share:
Basic	$	0.40		$	0.44
Diluted	$	0.40		$	0.44
Average Common Shares Outstanding:
Basic		8,723,633			7,904,759
Diluted		8,732,679			7,917,601

American National Bankshares Inc. and Subsidiaries
Financial Highlights
(In thousands, except share, ratio and
nonfinancial data, unaudited)	1st Qtr			4th Qtr			1st Qtr			YTD			YTD
	2015			2014			2014			2015			2014
EARNINGS
Interest income	$	13,839		$	11,869		$	11,954		$	13,839		$	11,954
Interest expense		1,461			1,414			1,495			1,461			1,495
Net interest income		12,378			10,455			10,459			12,378			10,459
Provision for loan losses		600			250			-			600			-
Noninterest income		3,156			2,792			2,703			3,156			2,703
Noninterest expense		10,047			8,943			8,423			10,047			8,423
Income taxes		1,372			1,164			1,289			1,372			1,289
Net income		3,515			2,890			3,450			3,515			3,450
PER COMMON SHARE
Earnings per share - basic	$	0.40		$	0.37		$	0.44		$	0.40		$	0.44
Earnings per share - diluted		0.40			0.37			0.44			0.40			0.44
Cash dividends paid		0.23			0.23			0.23			0.23			0.23
Book value per share (f)		22.58			22.07			21.57			22.58			21.57
Book value per share - tangible (a) (f)		17.09			16.86			16.27			17.09			16.27
Closing market price		22.58			24.81			23.52			22.58			23.52
FINANCIAL RATIOS
Return on average assets		0.93	%		0.86	%		1.06	%		0.93	%		1.06	%
Return on average equity		7.17			6.63			8.12			7.17			8.12
Return on average tangible equity (b)		10.02			9.12			11.54			10.02			11.54
Average equity to average assets		12.91			13.04			13.05			12.91			13.05
Tangible equity to tangible assets (a)		9.98			10.16			10.23			9.98			10.23
Efficiency ratio (e)		63.90			64.60			61.82			63.90			61.82
Effective tax rate		28.07			28.71			27.20			28.07			27.20
PERIOD-END BALANCES
Securities	$	357,544		$	349,250		$	353,652		$	357,544		$	353,652
Loans held for sale		1,936			616			1,389			1,936			1,389
Loans, net of unearned income		965,902			840,925			783,369			965,902			783,369
Goodwill and other intangibles		47,793			41,088			41,871			47,793			41,871
Assets		1,540,098			1,346,492			1,299,802			1,540,098			1,299,802
Assets - tangible (a)		1,492,305			1,305,404			1,257,931			1,492,305			1,257,931
Deposits		1,242,675			1,075,837			1,051,249			1,242,675			1,051,249
Customer repurchase agreements		53,664			53,480			34,153			53,664			34,153
Other short-term borrowings		-			-			-			-			-
Long-term borrowings		37,487			37,456			37,363			37,487			37,363
Shareholders' equity		196,689			173,780			170,499			196,689			170,499
AVERAGE BALANCES
Securities	$	345,800		$	331,785		$	345,152		$	345,800		$	345,152
Loans held for sale		939			982			2,032			939			2,032
Loans, net of unearned income		954,882			815,271			788,419			954,882			788,419
Interest-earning assets		1,382,817			1,220,818			1,186,904			1,382,817			1,186,904
Goodwill and other intangibles		47,988			41,222			42,077			47,988			42,077
Assets		1,518,449			1,338,240			1,302,639			1,518,449			1,302,639
Assets - tangible (a)		1,470,461			1,297,018			1,260,562			1,470,461			1,260,562
Interest-bearing deposits		938,064			816,965			830,229			938,064			830,229
Deposits		1,221,037			1,069,995			1,051,614			1,221,037			1,051,614
Customer repurchase agreements		53,181			50,493			37,797			53,181			37,797
Other short-term borrowings		-			-			-			-			-
Long-term borrowings		37,469			37,438			37,373			37,469			37,373
Shareholders' equity		196,086			174,453			170,046			196,086			170,046

American National Bankshares Inc. and Subsidiaries
Financial Highlights
(In thousands, except share, ratio and
nonfinancial data, unaudited)	1st Qtr			4th Qtr			1st Qtr			YTD			YTD
	2015			2014			2014			2015			2014
CAPITAL
Weighted average shares outstanding - basic		8,723,633			7,855,872			7,904,759			8,723,633			7,904,759
Weighted average shares outstanding - diluted		8,732,679			7,866,111			7,917,601			8,732,679			7,917,601
ALLOWANCE FOR LOAN LOSSES
Beginning balance	$	12,427		$	12,620		$	12,600		$	12,427		$	12,600
Provision for loan losses		600			250			-			600			-
Charge-offs		(309	)		(566	)		(73	)		(309	)		(73	)
Recoveries		126			123			87			126			87
Ending balance	$	12,844		$	12,427		$	12,614		$	12,844		$	12,614
LOANS
Construction and land development	$	68,069		$	50,863		$	40,458		$	68,069		$	40,458
Commercial real estate		436,562			391,472			358,362			436,562			358,362
Residential real estate		211,261			175,293			170,517			211,261			170,517
Home equity		97,811			91,075			89,081			97,811			89,081
Commercial and industrial		146,280			126,981			119,042			146,280			119,042
Consumer		5,919			5,241			5,909			5,919			5,909
Total	$	965,902		$	840,925		$	783,369		$	965,902		$	783,369
NONPERFORMING ASSETS AT PERIOD-END
Nonperforming loans:
90 days past due and accruing	$	-		$	-		$	-		$	-		$	-
Nonaccrual		5,123			4,112			5,557			5,123			5,557
Other real estate owned		2,653			2,119			3,233			2,653			3,233
Nonperforming assets	$	7,776		$	6,231		$	8,790		$	7,776		$	8,790
ASSET QUALITY RATIOS
Allowance for loan losses to total loans		1.33	%		1.48	%		1.61	%		1.33	%		1.61	%
Allowance for loan losses to
nonperforming loans		250.71			302.21			226.99			250.71			226.99
Nonperforming assets to total assets		0.50			0.46			0.68			0.50			0.68
Nonperforming loans to total loans		0.53			0.49			0.71			0.53			0.71
Annualized net charge-offs (recoveries)
to average loans		0.08			0.22			(0.01	)		0.08			(0.01	)
OTHER DATA
Fiduciary assets at period-end (c) (g)	$	502,779		$	450,498		$	435,635		$	502,779		$	435,635
Retail brokerage assets at period-end (c) (g)	$	244,725		$	210,265		$	189,130		$	244,725		$	189,130
Number full-time equivalent employees (d)		318			284			292			318			292
Number of full service offices		27			24			25			27			25
Number of loan production offices		2			2			2			2			2
Number of ATM's		34			31			31			34			31
Notes:
(a) - Excludes goodwill and other intangible assets.
(b) - Excludes amortization expense, net of tax, of intangible assets.
(c) - Market value.
(d) - Average for quarter.
(e) - The efficiency ratio is calculated by dividing noninterest expense excluding gains or losses on the sale of OREO by net
interest income including tax equivalent income on nontaxable loans and securities and excluding (a) gains or losses on
securities and (b) gains or losses on sale of premises and equipment.
(f) - Unvested restricted stock of 17,761 shares are not included in the calculation.
(g) - Assets are not owned by the Company and are not reflected in the consolidated balance sheet.

Net Interest Income Analysis
For the Three Months Ended March 31, 2015 and 2014
(in thousands, except rates)
					Interest
	Average Balance				Income/Expense				Yield/Rate
	2015		2014		2015		2014		2015			2014
Loans:
Commercial	$	139,120	$	120,707	$	1,826	$	1,472		5.32	%		4.95	%
Real estate		801,373		664,772		9,719		8,296		4.85			4.99
Consumer		15,328		4,972		240		89		6.35			7.26
Total loans		955,821		790,451		11,785		9,857		4.94			5.00
Securities:
Federal agencies & GSEs		74,850		68,356		245		178		1.31			1.04
Mortgage-backed & CMOs		65,558		66,631		378		403		2.31			2.42
State and municipal		190,216		193,542		1,763		1,899		3.71			3.92
Other		15,176		16,623		123		127		3.24			3.06
Total securities		345,800		345,152		2,509		2,607		2.90			3.02
Federal funds sold		14,580		-		4		-		0.11			-
Deposits in other banks		66,616		51,301		48		33		0.29			0.26
Total interest-earning assets		1,382,817		1,186,904		14,346		12,497		4.16			4.22
Non-earning assets		135,632		115,735
Total assets	$	1,518,449	$	1,302,639
Deposits:
Demand	$	212,673	$	168,080		18		22		0.03			0.05
Money market		202,935		192,871		71		75		0.14			0.16
Savings		107,683		86,898		12		14		0.05			0.07
Time		414,773		382,380		1,093		1,118		1.07			1.19
Total deposits		938,064		830,229		1,194		1,229		0.52			0.60
Customer repurchase agreements		53,181		37,797		3		2		0.02			0.02
Long-term borrowings		37,469		37,373		264		264		2.82			2.83
Total interest-bearing
liabilities		1,028,714		905,399		1,461		1,495		0.57			0.67
Noninterest bearing demand deposits		282,973		221,385
Other liabilities		10,676		5,809
Shareholders' equity		196,086		170,046
Total liabilities and
shareholders' equity	$	1,518,449	$	1,302,639
Interest rate spread										3.59	%		3.55	%
Net interest margin										3.73	%		3.71	%
Net interest income (taxable equivalent basis)						12,885		11,002
Less: Taxable equivalent adjustment						507		543
Net interest income					$	12,378	$	10,459