FOR IMMEDIATE RELEASE
CONTACTS: | James G. Rakes, Chairman, President & CEO | (540) 951-6236 |
| J. Robert Buchanan, Treasurer | (276) 979-0341 |
NATIONAL BANKSHARES, INC. RELEASES EARNINGS FOR 2007
BLACKSBURG, VA, FEBRUARY 7, 2008: National Bankshares, Inc. (NASDAQ Capital Market: NKSH) today reported 2007 net income of nearly $12.68 million, up slightly over the $12.63 million earned in 2006. Because of higher earnings and the Company’s previously announced stock buyback program, basic net income per share increased from $1.80 in 2006 to $1.82 in 2007. Total assets at December 31, 2007 were nearly $887.65 million, an increase of 2.24% over the same period in 2006. Net loans grew to $518.44 million, an increase of 4.63% from 2006. For 2007, National Bankshares, Inc. had a return on average assets of 1.46% and a return on average equity of 12.60%.
For the three months ending December 31, 2007, the Company posted net income of $3.22 million, a small increase over the $3.20 million earned in the fourth quarter of 2006. This translates to basic net income per share of $0.46 for both periods.
James G. Rakes, National Bankshares’ Chairman, President & CEO, commented, “In these interesting times, I am pleased to report another solid year for National Bankshares. We were challenged with compression of the net interest margin during 2007, and we worked to overcome that challenge by adding quality loans to our portfolio and by controlling overhead costs. The 2006 merger of our two bank subsidiaries resulted in nice savings for 2007 in both occupancy expense and salary and benefits costs. Loan quality remained very good when viewed from a historical perspective. We did, however, make regular additions to the provision for loan losses during the year, both because of growth in net loans and because of an increase in total nonperforming assets from 2006’s very low level.” Mr. Rakes went on to say, “We continued to invest in the Company’s technology infrastructure last year. We believe that it is important to have a solid platform from which to offer customers a full range of products and services. But we think it is even more important for our customers to have a trusted person to help them with their financial transactions. It is this relationship-based business philosophy that has guided us since the founding of National Bank in 1891 and will continue to guide us in the future.”
National Bankshares, Inc. is a financial holding company that is the parent of the National Bank of Blacksburg, which does business as National Bank from 26 office locations throughout Southwest Virginia. The Company, which is headquartered in Blacksburg, Virginia, also has a financial services subsidiary, National Bankshares Financial Services, Inc., doing business in the same market as National Bankshares Investment Services and National Bankshares Insurance Services. Company stock is traded on the NASDAQ Capital Market under the symbol “NKSH”. Additional information about National Bankshares, Inc. is available on its website at www.nationalbankshares.com.
(Unaudited tables follow)
National Bankshares, Inc.And Subsidiaries | ||||||||||
(000's), except ratios and percent data | ||||||||||
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Three months ending |
| December 31, 2007 |
| December 31, 2006 |
| Change |
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Selected Consolidated Data : |
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Interest income |
| $ | 12,851 |
| $ | 12,427 |
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| 3.41 | % |
Interest expense |
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| 5,517 |
|
| 5,261 |
|
| 4.87 | % |
Net interest income |
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| 7,334 |
|
| 7,166 |
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| 2.34 | % |
Provision for loan losses |
|
| 294 |
|
| 9 |
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| 3166.67 | % |
Trust income |
|
| 314 |
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| 469 |
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| -33.05 | % |
Other noninterest income |
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| 1,883 |
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| 1,830 |
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| 2.90 | % |
Salary and benefits |
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| 2,533 |
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| 2,760 |
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| -8.22 | % |
Occupancy expense |
|
| 427 |
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| 478 |
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| -10.67 | % |
Amortization of intangibles |
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| 285 |
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| 284 |
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| 0.35 | % |
Other noninterest expense |
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| 1,850 |
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| 1,852 |
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| -0.11 | % |
Income taxes |
|
| -919 |
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| -881 |
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| 4.31 | % |
Net income |
| $ | 3,223 |
| $ | 3,201 |
|
| 0.69 | % |
Basic net income per share |
| $ | 0.46 |
| $ | 0.46 |
| $ | 0.00 |
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Daily averages: |
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Gross loans |
| $ | 520,992 |
| $ | 498,366 |
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| 4.54 | % |
Loans,net |
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| 514,814 |
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| 492,104 |
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| 4.61 | % |
Total securities |
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| 277,008 |
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| 272,644 |
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| 1.60 | % |
Total deposits |
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| 763,023 |
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| 751,639 |
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| 1.51 | % |
Other borrowings |
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| 65 |
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| 78 |
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| -16.67 | % |
Stockholders' equity |
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| 103,677 |
|
| 97,741 |
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| 6.07 | % |
Cash and due from |
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| 13,870 |
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| 15,795 |
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| -12.19 | % |
Interest-earning assets |
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| 816,169 |
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| 792,919 |
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| 2.93 | % |
Interest-bearing liabilities |
|
| 651,162 |
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| 646,673 |
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| 0.69 | % |
Intangible assets |
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| 15,000 |
|
| 16,138 |
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| -7.05 | % |
Total assets |
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| 874,400 |
|
| 854,040 |
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| 2.38 | % |
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Financial ratios: Note (1) |
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Return on average assets |
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| 1.46 | % |
| 1.49 | % |
| -0.03 |
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Return on average equity |
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| 12.33 | % |
| 12.99 | % |
| -0.66 |
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Net interest margin |
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| 3.95 | % |
| 4.06 | % |
| -0.11 |
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Average equity to average assets |
|
| 11.86 | % |
| 11.44 | % |
| 0.41 |
|
Note (1) Ratio change measured in bp |
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Allowance for loan losses: |
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Beginning balance |
| $ | 5,043 |
| $ | 5,252 |
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| -3.98 | % |
Provision for losses |
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| 294 |
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| 9 |
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| 3166.67 | % |
Charge-offs |
|
| -152 |
|
| -114 |
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| 33.33 | % |
Recoveries |
|
| 34 |
|
| 10 |
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| 240.00 | % |
Ending balance |
| $ | 5,219 |
| $ | 5,157 |
|
| 1.20 | % |
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Year to Date |
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| December 31, 2007 |
|
| December 31, 2006 |
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| Change |
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Selected Consolidated Data : |
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Interest income |
| $ | 50,769 |
| $ | 47,901 |
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| 5.99 | % |
Interest expense |
|
| 21,745 |
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| 18,564 |
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| 17.14 | % |
Net interest income |
|
| 29,024 |
|
| 29,337 |
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| -1.07 | % |
Provision for loan losses |
|
| 423 |
|
| 49 |
|
| 763.27 | % |
Trust income |
|
| 1,333 |
|
| 1,528 |
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| -12.76 | % |
Other noninterest income |
|
| 7,427 |
|
| 7,274 |
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| 2.10 | % |
Salary and benefits |
|
| 10,773 |
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| 11,466 |
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| -6.04 | % |
Occupancy expense |
|
| 1,743 |
|
| 1,957 |
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| -10.94 | % |
Amortization of intangibles |
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| 1,138 |
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| 1,137 |
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| 0.09 | % |
Other noninterest expense |
|
| 7,302 |
|
| 7,110 |
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| 2.70 | % |
Income taxes |
|
| -3,730 |
|
| -3,788 |
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| -1.53 | % |
Net income |
| $ | 12,675 |
| $ | 12,632 |
|
| 0.34 | % |
Basic net income per share |
| $ | 1.82 |
| $ | 1.80 |
| $ | 0.02 |
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Fully diluted net income per share |
| $ | 1.82 |
| $ | 1.80 |
| $ | 0.02 |
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Dividends per share |
| $ | 0.73 |
| $ | 0.71 |
| $ | 0.02 |
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Dividend payout ratio |
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| 41.80 |
|
| 40.44 |
| $ | 1.36 |
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Book value per share |
| $ | 15.07 |
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| 13.86 |
| $ | 1.21 |
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Balance sheet at period-end: |
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Gross loans |
| $ | 524,773 |
| $ | 501,702 |
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| 4.60 | % |
Loans, net |
| $ | 518,435 |
| $ | 495,486 |
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| 4.63 | % |
Total securities |
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| 273,343 |
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| 285,489 |
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| -4.25 | % |
Cash and due from |
|
| 16,324 |
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| 15,283 |
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| 6.81 | % |
Total deposits |
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| 776,339 |
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| 764,692 |
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| 1.52 | % |
Other borrowings |
|
| 64 |
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| 73 |
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| -12.33 | % |
Stockholders' equity |
|
| 104,800 |
|
| 96,755 |
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| 8.31 | % |
Intangible assets |
|
| 14,838 |
|
| 15,976 |
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| -7.12 | % |
Total assets |
|
| 887,647 |
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| 868,203 |
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| 2.24 | % |
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Daily averages: |
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Gross loans |
| $ | 511,215 |
| $ | 493,668 |
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| 3.55 | % |
Loans,net |
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| 505,070 |
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| 487,130 |
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| 3.68 | % |
Total securities |
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| 282,734 |
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| 261,743 |
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| 8.02 | % |
Total deposits |
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| 758,657 |
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| 724,015 |
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| 4.78 | % |
Other borrowings |
|
| 626 |
|
| 420 |
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| 49.05 | % |
Stockholders' equity |
|
| 100,597 |
|
| 90,470 |
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| 11.19 | % |
Cash and due from |
|
| 13,947 |
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| 15,976 |
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| -12.70 | % |
Interest-earning assets |
|
| 807,686 |
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| 769,931 |
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| 4.90 | % |
Interest-bearing liabilities |
|
| 650,429 |
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| 610,534 |
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| 6.53 | % |
Intangible assets |
|
| 15,426 |
|
| 17,500 |
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| -11.85 | % |
Total assets |
|
| 867,061 |
|
| 819,341 |
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| 5.82 | % |
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Financial ratios: Note (1) |
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Return on average assets |
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| 1.46 | % |
| 1.50 | % |
| -0.04 |
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Return on average equity |
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| 12.60 | % |
| 13.41 | % |
| -0.81 |
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Net interest margin |
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| 3.98 | % |
| 4.14 | % |
| -0.16 |
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Efficiency ratio |
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| 51.11 | % |
| 52.74 | % |
| -1.63 |
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Average equity to average assets |
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| 11.60 | % |
| 11.04 | % |
| 0.56 |
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Note (1) Ratio change measured in bp |
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Allowance for loan losses: |
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Beginning balance |
| $ | 5,157 |
| $ | 5,449 |
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| -5.36 | % |
Provision for losses |
|
| 423 |
|
| 49 |
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| 763.27 | % |
Charge-offs |
|
| -471 |
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| -459 |
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| 2.61 | % |
Recoveries |
|
| 110 |
|
| 118 |
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| -6.78 | % |
Ending balance |
| $ | 5,219 |
| $ | 5,157 |
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| 1.20 | % |
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Nonperforming assets: |
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Nonaccrual loans |
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| 1,150 |
|
| --- |
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| --- |
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Restructured loans |
|
| --- |
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| --- |
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| --- |
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Total nonperforming loans Note (2) |
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| 1,150 |
|
| 0 |
|
| --- |
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Other real estate owned |
|
| 263 |
|
| 390 |
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| -32.56 | % |
Total nonperforming assets |
| $ | 1,413 |
| $ | 390 |
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| 262.31 | % |
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Asset quality ratios: Note (3) |
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Nonperforming loans to total loans |
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| 0.220 | % |
| --- |
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| --- |
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Allowance for loan losses to total loans |
|
| 1.00 | % |
| 1.03 | % |
| -3.33 | % |
Allowance for loan losses to nonperforming loans |
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| 453.83 | % |
| --- |
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| --- |
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Note (2) Loans 90 days past due or more not included |
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Note (3) Ratio change measured in bp |
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