American National Bankshares Inc. | ||||||||
Consolidated Balance Sheets | ||||||||
(Dollars in thousands, except per share data) | ||||||||
Unaudited | ||||||||
March 31 | ||||||||
Assets | 2019 | 2018 | ||||||
Cash and due from banks | $ | 28,912 | $ | 18,772 | ||||
Interest-bearing deposits in other banks | 41,949 | 57,881 | ||||||
Equity securities, at fair value | 2,069 | 2,320 | ||||||
Securities available for sale, at fair value | 324,289 | 310,348 | ||||||
Restricted stock, at cost | 5,299 | 5,221 | ||||||
Loans held for sale | 1,252 | 1,792 | ||||||
Loans | 1,360,063 | 1,321,221 | ||||||
Less allowance for loan losses | (12,806 | ) | (13,575 | ) | ||||
Net Loans | 1,347,257 | 1,307,646 | ||||||
Premises and equipment, net | 30,900 | 25,759 | ||||||
Other real estate owned, net | 646 | 1,716 | ||||||
Goodwill | 43,872 | 43,872 | ||||||
Core deposit intangibles, net | 871 | 1,114 | ||||||
Bank owned life insurance | 19,047 | 18,566 | ||||||
Accrued interest receivable and other assets | 22,041 | 22,567 | ||||||
Total assets | $ | 1,868,404 | $ | 1,817,574 | ||||
Liabilities | ||||||||
Demand deposits -- noninterest-bearing | $ | 400,225 | $ | 381,247 | ||||
Demand deposits -- interest-bearing | 233,973 | 222,356 | ||||||
Money market deposits | 409,290 | 314,495 | ||||||
Savings deposits | 134,171 | 126,774 | ||||||
Time deposits | 381,592 | 371,232 | ||||||
Total deposits | 1,559,251 | 1,416,104 | ||||||
Customer repurchase agreements | 10,466 | 47,776 | ||||||
Long-term borrowings | — | 9,985 | ||||||
Junior subordinated debt | 27,851 | 27,749 | ||||||
Accrued interest payable and other liabilities | 10,166 | 9,950 | ||||||
Total liabilities | 1,607,734 | 1,511,564 | ||||||
Shareholders' equity | ||||||||
Preferred stock, $5 par, 2,000,000 shares authorized, | ||||||||
none outstanding | — | — | ||||||
Common stock, $1 par, 20,000,000 shares authorized, | ||||||||
8,756,569 shares outstanding at March 31, 2019 and | ||||||||
8,675,033 shares outstanding at March 31, 2018 | 8,705 | 8,621 | ||||||
Capital in excess of par value | 78,738 | 76,525 | ||||||
Retained earnings | 145,351 | 131,299 | ||||||
Accumulated other comprehensive loss, net | (3,321 | ) | (6,605 | ) | ||||
Total shareholders' equity | 229,473 | 209,840 | ||||||
Total liabilities and shareholders' equity | $ | 1,868,404 | $ | 1,817,574 |
American National Bankshares Inc. | ||||||||
Consolidated Statements of Income | ||||||||
(Dollars in thousands, except per share data) | ||||||||
Unaudited | ||||||||
Three Months Ended | ||||||||
March 31 | ||||||||
2019 | 2018 | |||||||
Interest and Dividend Income: | ||||||||
Interest and fees on loans | $ | 15,638 | $ | 14,657 | ||||
Interest and dividends on securities: | ||||||||
Taxable | 1,821 | 1,324 | ||||||
Tax-exempt | 287 | 419 | ||||||
Dividends | 84 | 80 | ||||||
Other interest income | 266 | 188 | ||||||
Total interest and dividend income | 18,096 | 16,668 | ||||||
Interest Expense: | ||||||||
Interest on deposits | 2,472 | 1,825 | ||||||
Interest on short-term borrowings | 172 | 10 | ||||||
Interest on junior subordinated debt | 384 | 290 | ||||||
Total interest expense | 3,028 | 2,125 | ||||||
Net Interest Income | 15,068 | 14,543 | ||||||
Provision for (recovery of) loan losses | 16 | (44 | ) | |||||
Net Interest Income After Provision | ||||||||
for (Recovery of) Loan Losses | 15,052 | 14,587 | ||||||
Noninterest Income: | ||||||||
Trust fees | 914 | 929 | ||||||
Service charges on deposit accounts | 594 | 612 | ||||||
Other fees and commissions | 708 | 642 | ||||||
Mortgage banking income | 406 | 450 | ||||||
Securities gains, net | 323 | 121 | ||||||
Brokerage fees | 147 | 222 | ||||||
Income from Small Business Investment Companies | 168 | 155 | ||||||
Other | 191 | 202 | ||||||
Total noninterest income | 3,451 | 3,333 | ||||||
Noninterest Expense: | ||||||||
Salaries | 4,664 | 4,997 | ||||||
Employee benefits | 1,230 | 1,175 | ||||||
Occupancy and equipment | 1,084 | 1,128 | ||||||
FDIC assessment | 125 | 146 | ||||||
Bank franchise tax | 290 | 281 | ||||||
Core deposit intangible amortization | 55 | 77 | ||||||
Data processing | 532 | 422 | ||||||
Software | 324 | 305 | ||||||
Other real estate owned, net | 13 | 30 | ||||||
Merger related expenses | 451 | — | ||||||
Other | 2,161 | 2,141 | ||||||
Total noninterest expense | 10,929 | 10,702 | ||||||
Income Before Income Taxes | 7,574 | 7,218 | ||||||
Income Taxes | 1,571 | 1,406 | ||||||
Net Income | $ | 6,003 | $ | 5,812 | ||||
Net Income Per Common Share: | ||||||||
Basic | $ | 0.69 | $ | 0.67 | ||||
Diluted | $ | 0.69 | $ | 0.67 | ||||
Weighted Average Common Shares Outstanding: | ||||||||
Basic | 8,745,174 | 8,669,728 | ||||||
Diluted | 8,745,723 | 8,687,351 |
American National Bankshares Inc. | |||||||||||||||
Financial Highlights | |||||||||||||||
Unaudited | |||||||||||||||
(Dollars in thousands, except per share data) | |||||||||||||||
1st Qtr | 4th Qtr | 1st Qtr | |||||||||||||
2019 | 2018 | 2018 | |||||||||||||
EARNINGS | |||||||||||||||
Interest income | $ | 18,096 | $ | 17,891 | $ | 16,668 | |||||||||
Interest expense | 3,028 | 2,879 | 2,125 | ||||||||||||
Net interest income | 15,068 | 15,012 | 14,543 | ||||||||||||
Provision for (recovery of) loan losses | 16 | (6 | ) | (44 | ) | ||||||||||
Noninterest income | 3,451 | 2,998 | 3,333 | ||||||||||||
Noninterest expense | 10,929 | 11,638 | 10,702 | ||||||||||||
Income taxes | 1,571 | 1,376 | 1,406 | ||||||||||||
Net income | 6,003 | 5,002 | 5,812 | ||||||||||||
PER COMMON SHARE | |||||||||||||||
Income per share - basic | $ | 0.69 | $ | 0.57 | $ | 0.67 | |||||||||
Income per share - diluted | 0.69 | 0.57 | 0.67 | ||||||||||||
Cash dividends paid | 0.25 | 0.25 | 0.25 | ||||||||||||
Book value per share | 26.21 | 25.52 | 24.19 | ||||||||||||
Book value per share - tangible (a) | 21.10 | 20.38 | 19.00 | ||||||||||||
Closing market price | 34.92 | 29.31 | 37.60 | ||||||||||||
FINANCIAL RATIOS | |||||||||||||||
Return on average assets | 1.29 | % | 1.08 | % | 1.28 | % | |||||||||
Return on average equity | 10.69 | 9.16 | 11.10 | ||||||||||||
Return on average tangible equity (a) | 13.44 | 11.63 | 14.29 | ||||||||||||
Average equity to average assets | 12.06 | 11.78 | 11.52 | ||||||||||||
Tangible equity to tangible assets (a) | 10.13 | 9.78 | 9.30 | ||||||||||||
Net interest margin, taxable equivalent | 3.50 | 3.48 | 3.46 | ||||||||||||
Efficiency ratio (a) | 56.95 | 58.15 | 59.36 | ||||||||||||
Effective tax rate | 20.74 | 21.57 | 19.48 | ||||||||||||
PERIOD-END BALANCES | |||||||||||||||
Securities | $ | 331,657 | $ | 339,730 | $ | 317,889 | |||||||||
Loans held for sale | 1,252 | 640 | 1,792 | ||||||||||||
Loans, net of unearned income | 1,360,063 | 1,357,476 | 1,321,221 | ||||||||||||
Goodwill and other intangibles | 44,743 | 44,798 | 44,986 | ||||||||||||
Assets | 1,868,404 | 1,862,866 | 1,817,574 | ||||||||||||
Assets - tangible (a) | 1,823,661 | 1,818,068 | 1,772,588 | ||||||||||||
Deposits | 1,559,790 | 1,566,227 | 1,559,251 | ||||||||||||
Customer repurchase agreements | 35,945 | 35,243 | 10,466 | ||||||||||||
Long-term borrowings | 32,191 | 27,927 | 27,851 | ||||||||||||
Shareholders' equity | 229,473 | 222,542 | 209,840 | ||||||||||||
Shareholders' equity - tangible (a) | 184,730 | 177,744 | 164,854 | ||||||||||||
American National Bankshares Inc. | |||||||||||||||
Financial Highlights | |||||||||||||||
Unaudited | |||||||||||||||
(Dollars in thousands, except per share data) | |||||||||||||||
1st Qtr | 4th Qtr | 1st Qtr | |||||||||||||
2019 | 2018 | 2018 | |||||||||||||
AVERAGE BALANCES | |||||||||||||||
Securities (b) | $ | 343,834 | $ | 332,230 | $ | 312,783 | |||||||||
Loans held for sale | 1,830 | 1,201 | 2,037 | ||||||||||||
Loans, net of unearned income | 1,352,521 | 1,335,469 | 1,338,058 | ||||||||||||
Interest-earning assets | 1,736,887 | 1,736,453 | 1,698,451 | ||||||||||||
Goodwill and other intangibles | 44,778 | 44,831 | 45,031 | ||||||||||||
Assets | 1,863,212 | 1,854,492 | 1,818,429 | ||||||||||||
Assets - tangible (a) | 1,818,434 | 1,809,661 | 1,773,398 | ||||||||||||
Interest-bearing deposits | 1,131,604 | 1,116,911 | 1,157,122 | ||||||||||||
Deposits | 1,551,413 | 1,558,864 | 1,557,149 | ||||||||||||
Customer repurchase agreements | 42,705 | 37,905 | 12,247 | ||||||||||||
Other short-term borrowings | 61 | — | 2,183 | ||||||||||||
Long-term borrowings | 32,197 | 27,914 | 27,836 | ||||||||||||
Shareholders' equity | 224,677 | 218,430 | 209,433 | ||||||||||||
Shareholders' equity - tangible (a) | 179,899 | 173,599 | 164,402 | ||||||||||||
CAPITAL | |||||||||||||||
Weighted average shares outstanding - basic | 8,745,174 | 8,717,572 | 8,669,728 | ||||||||||||
Weighted average shares outstanding - diluted | 8,745,723 | 8,723,388 | 8,687,351 | ||||||||||||
ALLOWANCE FOR LOAN LOSSES | |||||||||||||||
Beginning balance | $ | 12,805 | $ | 13,588 | $ | 13,603 | |||||||||
Provision for (recovery of) loan losses | 16 | (6 | ) | (44 | ) | ||||||||||
Charge-offs | (69 | ) | (818 | ) | (44 | ) | |||||||||
Recoveries | 54 | 41 | 60 | ||||||||||||
Ending balance | $ | 12,806 | $ | 12,805 | $ | 13,575 | |||||||||
LOANS | |||||||||||||||
Construction and land development | $ | 93,759 | $ | 97,240 | $ | 93,031 | |||||||||
Commercial real estate | 659,133 | 655,800 | 624,164 | ||||||||||||
Residential real estate | 212,665 | 209,438 | 207,256 | ||||||||||||
Home equity | 99,979 | 103,933 | 108,024 | ||||||||||||
Commercial and industrial | 289,301 | 285,972 | 284,257 | ||||||||||||
Consumer | 5,226 | 5,093 | 4,489 | ||||||||||||
Total | $ | 1,360,063 | $ | 1,357,476 | $ | 1,321,221 | |||||||||
NONPERFORMING ASSETS AT PERIOD-END | |||||||||||||||
Nonperforming loans: | |||||||||||||||
90 days past due and accruing | $ | 197 | $ | 72 | $ | 273 | |||||||||
Nonaccrual | 1,111 | 1,090 | 1,598 | ||||||||||||
Other real estate owned | 646 | 869 | 1,716 | ||||||||||||
Nonperforming assets | $ | 1,954 | $ | 2,031 | $ | 3,587 | |||||||||
American National Bankshares Inc. | |||||||||||||||
Financial Highlights | |||||||||||||||
Unaudited | |||||||||||||||
(Dollars in thousands, except per share data) | |||||||||||||||
1st Qtr | 4th Qtr | 1st Qtr | |||||||||||||
2019 | 2018 | 2018 | |||||||||||||
ASSET QUALITY RATIOS | |||||||||||||||
Allowance for loan losses to total loans | 0.94 | % | 0.94 | % | 1.03 | % | |||||||||
Allowance for loan losses to nonperforming loans | 979.05 | 1,101.98 | 725.55 | ||||||||||||
Nonperforming assets to total assets | 0.10 | 0.11 | 0.20 | ||||||||||||
Nonperforming loans to total loans | 0.10 | 0.09 | 0.14 | ||||||||||||
Annualized net charge-offs (recoveries) to average loans | 0.00 | 0.23 | 0.00 | ||||||||||||
OTHER DATA | |||||||||||||||
Fiduciary assets at period-end (c) (d) | $ | 533,063 | $ | 494,034 | $ | 509,668 | |||||||||
Retail brokerage assets at period-end (c) (d) | $ | 303,045 | $ | 274,552 | $ | 316,064 | |||||||||
Number full-time equivalent employees (e) | 299 | 305 | 326 | ||||||||||||
Number of full service offices | 24 | 24 | 26 | ||||||||||||
Number of loan production offices | — | 2 | 2 | ||||||||||||
Number of ATM's | 33 | 33 | 34 | ||||||||||||
Notes: | |||||||||||||||
(a) - This financial measure is not calculated in accordance with GAAP. For a reconciliation of non-GAAP financial | |||||||||||||||
measures, see "Reconciliation of Non-GAAP Financial Measures" at the end of this release. | |||||||||||||||
(b) - Average does not include unrealized gains and losses. | |||||||||||||||
(c) - Market value. | |||||||||||||||
(d) - Assets are not owned by American National and are not reflected in the consolidated balance sheet. | |||||||||||||||
(e) - Average for quarter. |
Net Interest Income Analysis | |||||||||||||||||||||||||
For the Three Months Ended March 31, 2019 and 2018 | |||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||
Unaudited | |||||||||||||||||||||||||
Interest | |||||||||||||||||||||||||
Average Balance | Income/Expense | Yield/Rate | |||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||
Loans: | |||||||||||||||||||||||||
Commercial | $ | 265,578 | $ | 258,552 | $ | 2,891 | $ | 2,444 | 4.41 | % | 3.83 | % | |||||||||||||
Real estate | 1,083,800 | 1,077,243 | 12,716 | 12,189 | 4.69 | 4.53 | |||||||||||||||||||
Consumer | 4,973 | 4,300 | 75 | 76 | 6.12 | 7.17 | |||||||||||||||||||
Total loans | 1,354,351 | 1,340,095 | 15,682 | 14,709 | 4.64 | 4.40 | |||||||||||||||||||
Securities: | |||||||||||||||||||||||||
Federal agencies & GSEs | 139,465 | 103,199 | 850 | 517 | 2.44 | 2.00 | |||||||||||||||||||
Mortgage-backed & CMOs | 111,701 | 108,826 | 693 | 600 | 2.48 | 2.21 | |||||||||||||||||||
State and municipal | 78,597 | 86,336 | 538 | 634 | 2.74 | 2.94 | |||||||||||||||||||
Other | 14,071 | 14,422 | 178 | 175 | 5.06 | 4.85 | |||||||||||||||||||
Total securities | 343,834 | 312,783 | 2,259 | 1,926 | 2.63 | 2.46 | |||||||||||||||||||
Deposits in other banks | 38,702 | 45,573 | 266 | 188 | 2.79 | 1.67 | |||||||||||||||||||
Total interest-earning assets | 1,736,887 | 1,698,451 | 18,207 | 16,823 | 4.20 | 3.97 | |||||||||||||||||||
Non-earning assets | 126,325 | 119,978 | |||||||||||||||||||||||
Total assets | $ | 1,863,212 | $ | 1,818,429 | |||||||||||||||||||||
Deposits: | |||||||||||||||||||||||||
Demand | $ | 238,430 | $ | 232,383 | 14 | 11 | 0.02 | 0.02 | |||||||||||||||||
Money market | 395,704 | 410,171 | 1,153 | 783 | 1.18 | 0.77 | |||||||||||||||||||
Savings | 134,060 | 130,708 | 10 | 9 | 0.03 | 0.03 | |||||||||||||||||||
Time | 363,410 | 383,860 | 1,295 | 1,022 | 1.45 | 1.08 | |||||||||||||||||||
Total deposits | 1,131,604 | 1,157,122 | 2,472 | 1,825 | 0.89 | 0.64 | |||||||||||||||||||
Customer repurchase agreements | 42,705 | 12,247 | 171 | 1 | 1.62 | 0.03 | |||||||||||||||||||
Other short-term borrowings | 61 | 2,183 | 1 | 9 | 6.56 | 1.65 | |||||||||||||||||||
Long-term borrowings | 27,937 | 27,836 | 384 | 290 | 5.50 | 4.17 | |||||||||||||||||||
Total interest-bearing | |||||||||||||||||||||||||
liabilities | 1,202,307 | 1,199,388 | 3,028 | 2,125 | 1.02 | 0.72 | |||||||||||||||||||
Noninterest bearing demand deposits | 419,809 | 400,027 | |||||||||||||||||||||||
Other liabilities | 16,419 | 9,581 | |||||||||||||||||||||||
Shareholders' equity | 224,677 | 209,433 | |||||||||||||||||||||||
Total liabilities and | |||||||||||||||||||||||||
shareholders' equity | $ | 1,863,212 | $ | 1,818,429 | |||||||||||||||||||||
Interest rate spread | 3.18 | % | 3.25 | % | |||||||||||||||||||||
Net interest margin | 3.5 | % | 3.46 | % | |||||||||||||||||||||
Net interest income (taxable equivalent basis) | 15,179 | 14,698 | |||||||||||||||||||||||
Less: Taxable equivalent adjustment (a) | 111 | 155 | |||||||||||||||||||||||
Net interest income | $ | 15,068 | $ | 14,543 |
American National Bankshares Inc. | |||||||||||||||
Reconciliation of Non-GAAP Financial Measures | |||||||||||||||
Unaudited | |||||||||||||||
(Dollars in thousands, except per share data) | |||||||||||||||
1st Qtr | 4th Qtr | 1st Qtr | |||||||||||||
2019 | 2018 | 2018 | |||||||||||||
EFFICIENCY RATIO | |||||||||||||||
Noninterest expense | $ | 10,929 | $ | 11,638 | $ | 10,702 | |||||||||
Add/subtract: loss/(gain) on sale of OREO | 2 | (11 | ) | 5 | |||||||||||
Subtract: core deposit intangible amortization | (55 | ) | (55 | ) | (77 | ) | |||||||||
Subtract: merger related expense | (451 | ) | (872 | ) | — | ||||||||||
$ | 10,425 | $ | 10,700 | $ | 10,630 | ||||||||||
Net interest income | $ | 15,068 | $ | 15,012 | $ | 14,543 | |||||||||
Tax equivalent adjustment | 111 | 114 | 155 | ||||||||||||
Noninterest income | 3,451 | 2,998 | 3,333 | ||||||||||||
Add/subtract: (gain)/loss on securities | (323 | ) | 270 | (121 | ) | ||||||||||
Add/subtract: (gain)/loss on fixed assets | — | 6 | (3 | ) | |||||||||||
$ | 18,307 | $ | 18,400 | $ | 17,907 | ||||||||||
Efficiency ratio | 56.95 | % | 58.15 | % | 59.36 | % | |||||||||
TAX EQUIVALENT NET INTEREST INCOME | |||||||||||||||
Non-GAAP measures: | |||||||||||||||
Interest income - loans | $ | 15,682 | $ | 15,525 | $ | 14,709 | |||||||||
Interest income - investments and other | 2,525 | 2,480 | 2,114 | ||||||||||||
Interest expense - deposits | (2,472 | ) | (2,340 | ) | (1,825 | ) | |||||||||
Interest expense - customer repurchase agreements | (171 | ) | (145 | ) | (1 | ) | |||||||||
Interest expense - other short-term borrowings | (1 | ) | — | (9 | ) | ||||||||||
Interest expense - long-term borrowings | (384 | ) | (394 | ) | (290 | ) | |||||||||
Total net interest income | $ | 15,179 | $ | 15,126 | $ | 14,698 | |||||||||
Less non-GAAP measures: | |||||||||||||||
Tax benefit on nontaxable interest - loans | (44 | ) | (44 | ) | (52 | ) | |||||||||
Tax benefit on nontaxable interest - securities | (67 | ) | (70 | ) | (103 | ) | |||||||||
GAAP measures | $ | 15,068 | $ | 15,012 | $ | 14,543 | |||||||||
RETURN ON AVERAGE TANGIBLE EQUITY | |||||||||||||||
Return on average equity (GAAP basis) | 10.69 | % | 9.16 | % | 11.10 | % | |||||||||
Impact of excluding average goodwill and other intangibles | 2.75 | 2.47 | 3.19 | ||||||||||||
Return on average tangible equity (non-GAAP) | 13.44 | % | 11.63 | % | 14.29 | % | |||||||||
TANGIBLE EQUITY TO TANGIBLE ASSETS | |||||||||||||||
Equity to assets ratio (GAAP basis) | 12.28 | % | 11.95 | % | 11.55 | % | |||||||||
Impact of excluding goodwill and other intangibles | 2.15 | 2.17 | 2.25 | ||||||||||||
Tangible equity to tangible assets ratio (non-GAAP) | 10.13 | % | 9.78 | % | 9.30 | % | |||||||||
TANGIBLE BOOK VALUE | |||||||||||||||
Book value per share (GAAP basis) | $ | 26.21 | $ | 25.52 | $ | 24.19 | |||||||||
Impact of excluding goodwill and other intangibles | 5.11 | 5.14 | 5.19 | ||||||||||||
Tangible book value per share (non-GAAP) | $ | 21.10 | $ | 20.38 | $ | 19.00 |