U. S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
___________________________________________________________________________
FORM 10-K
(Mark One)
[X] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 (fee required)
For the fiscal year ended December 31, 1994
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 (no fee required)
For the transition period from to
___________________________________________________________________________
Commission File No. 0-12896
OLD POINT FINANCIAL CORPORATION
(Name of issuer in its charter)
Virginia 54-1265373
(State or other jurisdiction
of incorporation or organization) (I.R.S. Employer Identification
No.)
1 West Mellen Street, Hampton, Va. 23663
(Address of principal executive offices) (Zip Code)
(804) 722-7451
(Issuer's telephone number)
___________________________________________________________________________
Securities registered pursuant to Section 12(b) of the Exchange Act: None
Securities registered pursuant to Section 12(g) of the Exchange Act:
Common Stock ($5.00 par value)
(Title of class)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes X No
Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. [X]
As of March 14, 1995 there were 1,273,537 shares of common stock
outstanding and the aggregate market value of common stock of Old Point
Financial Corporation held by nonaffiliates was approximately $37,270,350
based upon the last traded price per share known to Management.
DOCUMENTS INCORPORATED BY REFERENCE
NONE
OLD POINT FINANCIAL CORPORATION
Form 10-K
INDEX
Page
PART I
Item 1. Description of Business 1
General 1
Statistical Information 2
Item 2. Description of Properties 13
Item 3. Legal Proceedings 14
Item 4. Submission of Matters to a Vote of Security Holders 14
PART II
Item 5. Market for Registrant's Common Equity and
Related Stockholder Matters 15
Item 6. Selected Financial Data 15
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations 17
Item 8. Financial Statements and Supplementary Data 21
Item 9. Changes in and Disagreements With Accountants on
Accounting and Financial Disclosure 39
PART III
Item 10. Directors and Executive Officers of the Registrant 40
Item 11. Executive Compensation 42
Item 12. Security Ownership of Certain Beneficial Owners
and Management 43
Item 13. Certain Relationships and Related Transactions 43
PART IV
Item 14. Exhibits, Financial Statement Schedules and
Reports on Form 8-K 44
-i-
PART I
Item 1. Description of Business
General
Old Point Financial Corporation (the "Company") was incorporated under the
laws of Virginia on February 16, 1984, for the purpose of acquiring all the
outstanding common stock of The Old Point National Bank of Phoebus (the
"Bank"), in connection with the reorganization of the Bank into a one bank
holding company structure. At the annual meeting of the stockholders on March
27, 1984, the proposed reorganization was approved by the requisite
stockholder vote. At the effective date of the reorganization on October 1,
1984, the Bank merged into a newly formed national bank as a wholly owned
subsidiary of the Company, with each outstanding share of common stock of the
Bank being converted into five shares of common stock of the Company.
The Company has no other subsidiaries and does not engage in any activities
other than acting as a holding company for the common stock of the Bank. The
principal business of the Company is conducted through the Bank, which
continues to conduct its business in substantially the same manner and from
the same offices as it had done before the effective date of the
reorganization. The Bank, therefore, accounts for substantially all of the
consolidated assets and revenues of the Company.
The Bank is a national banking association founded in 1922. The Bank has
thirteen offices in the cities of Hampton and Newport News, and in James City
County, Virginia, and provides a full range of banking and related financial
services, including checking, savings, certificates of deposit, and other
depository services, commercial, industrial, residential real estate and
consumer loan services, safekeeping services and trust and estate services.
As of December 31, 1994, the Company had assets of $277.7 million, loans (net
of unearned income) of $173.7 million, deposits of $235.6 million, and
stockholders' equity of $26.2 million. At year end, the Company and the Bank
had a total of 234 employees, 33 of whom were part-time.
Based on 1990 census figures, the population of the Bank's trade area, which
includes Hampton, Newport News, Williamsburg, and James City County was
approximately 350,000. This area's economy is heavily influenced by the two
largest employers; military installations and shipbuilding and ship repair.
These industries are impacted by reductions in defense spending and personnel.
Some of our customers are either employed at the various military
installations or at the shipyard, or they derive some or all of their business
from these two major employers. There are numerous military installations in
the area including Fort Monroe, Langley Air Force Base, and Fort Eustis. The
consolidation of the Tactical Air Command and the Strategic Air Command into
the Air Combat Command at Langley has somewhat mitigated the reduction in
military employment in the area. The largest private employer on the
Peninsula is the Newport News Shipbuilding and Drydock Company, which
currently employees approximately 20,000 people.
The banking industry is highly competitive in the Hampton/Newport
News/Williamsburg area. There are approximately nine commercial banks
actively engaged in business in the area in which the Bank operates, including
seven major statewide banking organizations.
The Bank encounters competition for deposits and loans from banks, savings and
-1-
loan associations and credit unions in the communities in which it operates.
In addition, the Bank must compete for deposits in some instances with the
money market mutual funds which are marketed nationally.
The Bank is subject to regulation and examination by the Office of the
Comptroller of the Currency, the Federal Reserve Board (the "Board"), and the
Federal Deposit Insurance Corporation (the "FDIC").
As a bank holding company within the meaning of the Bank Holding Company Act
of 1956, the Company is subject to the ongoing regulation, supervision, and
examination by the Federal Reserve Board (the "Board"). The Company is
required to file with the Board periodic and annual reports and other
information concerning its own business operations and those of its
subsidiaries. In addition, prior Board approval must be obtained before the
Company can acquire (i) ownership or control of any voting shares of another
bank if, after such acquisition, it would control more than 5% of such shares,
or (ii) all or substantially all of the assets of another bank or merge or
consolidate with another bank holding company. A bank holding company is
prohibited under the Bank Holding Company Act, with limited exceptions, from
engaging in activities other than those of banking or of managing or
controlling banks or furnishing services to its subsidiaries.
Statistical Information
The following statistical information is furnished pursuant to the
requirements of Guide 3 (Statistical Disclosure by Bank Holding Companies)
promulgated under the Securities Act of 1933.
I. Distribution of Assets, Liabilities and Shareholders' Equity; Interest
Rates and Interest Differential
The following table presents the distribution of assets, liabilities, and
shareholders' equity by major categories with related average yields/rates.
In these balance sheets, nonaccrual loans are included in the daily average
loans outstanding.
-2-
TABLE I
AVERAGE BALANCE SHEETS, NET INTEREST INCOME*<F1> AND RATES*<F1>
______________________________________________________________________________________________________________________________
For the years ended December 31, 1994 1993 1992
Average Average Average
Interest Rates Interest Rates Interest Rates
Average Income/ Earned/ Average Income/ Earned/ Average Income/ Earned/
Dollars in thousands Balance Expense Paid Balance Expense Paid Balance Expense Paid
______________________________________________________________________________________________________________________________
ASSETS
Loans (net of unearned income) $162,963 $13,917 8.54% $155,551 $13,679 8.79% $173,172 $16,262 9.39%
Investment securities:
Taxable 86,038 4,932 5.73% 78,420 4,855 6.19% 60,342 4,051 6.71%
Tax Exempt 6,315 628 9.94% 8,235 793 9.63% 10,200 1,044 10.23%
_______ ______ _______ ______ _______ ______
Total Investment Securities 92,353 5,560 6.02% 86,655 5,648 6.52% 70,542 5,095 7.22%
Federal funds sold 3,540 131 3.70% 7,634 229 3.00% 6,341 223 3.52%
_______ ______ _______ ______ _______ ______
Total earning assets 258,856 19,608 7.57% 249,840 19,556 7.83% 250,055 21,580 8.63%
Allowance for loan losses (2,759) (3,298) (3,835)
_______ _______ _______
256,097 246,542 246,220
Cash and due from banks 8,868 8,991 8,444
Bank premises and equipment 8,275 8,299 8,874
Other assets 5,158 6,853 5,379
_______ _______ _______
TOTAL ASSETS $278,398 $270,685 $268,917
======= ======= =======
LIABILITIES AND
STOCKHOLDER'S EQUITY
Time and savings deposits:
Interest bearing
transaction accounts $ 50,739 $ 1,327 2.62% $ 43,406 $ 1,217 2.80% $ 38,013 $ 1,272 3.35%
Money market deposit accounts 19,526 613 3.14% 19,797 568 2.87% 20,051 697 3.48%
Savings accounts 30,070 826 2.75% 29,203 926 3.17% 21,731 798 3.67%
Certificates of deposit,
$100,000 or more 10,979 478 4.35% 10,217 458 4.48% 13,467 744 5.52%
Other certificates of deposit 83,512 3,850 4.61% 85,029 4,127 4.85% 98,661 5,970 6.05%
_______ ______ _______ ______ _______ ______
Total time and savings
deposits 194,826 7,094 3.64% 187,652 7,296 3.89% 191,923 9,481 4.94%
Federal funds purchased
and securities sold
under agreement to repurchase 14,528 503 3.46% 15,396 437 2.84% 14,390 502 3.49%
Other short-term borrowings 617 28 4.54% 123 9 7.32% 299 16 5.35%
_______ ______ _______ ______ _______ ______
Total interest
bearing liabilities 209,971 7,625 3.63% 203,171 7,742 3.81% 206,612 9,999 4.84%
Demand deposits 40,004 40,870 36,799
Other liabilities 1,729 1,747 1,650
_______ _______ _______
Total liabilities 251,704 245,788 245,061
Stockholder's equity 26,694 24,897 23,856
_______ _______ _______
TOTAL LIABILITIES AND
STOCKHOLDER'S EQUITY $278,398 $270,685 $268,917
======= ======= =======
Net interest income/yield
$11,983 4.63% $11,814 4.73% $11,581 4.63%
====== ====== ======
Total deposits $234,830 $228,522 $228,722
<FN>
<F1>
*Computed on a fully taxable equivalent basis using a 34% rate.
</FN>
-3-
The following table sets forth a summary of changes in interest earned and
paid attributable to changes in volume and changes in yields/rates.
TABLE II
ANALYSIS OF CHANGE IN NET INTEREST INCOME*<F2>
__________________________________________________________________________________________________________________________
Year 1994 over 1993 Year 1993 over 1992 Year 1992 over 1991
Due to change in: Due to change in: Due to change in:
Average Average Net Average Average Net Average Average Net
Volume Rate Increase Volume Rate Increase Volume Rate Increase
Dollars in Thousands (Decrease) (Decrease) (Decrease)
__________________________________________________________________________________________________________________________
INCOME FROM
EARNINGS ASSETS
Loans $ 652 $(414) $238 $(1,655) $ (928) $(2,583) $(1,222) $(2,006) $(3,228)
Investment Securities:
Taxable 472 (395) 77 1,214 (410) 804 1,473 (953) 520
Tax-exempt (185) 20 (165) (201) (50) (251) 15 (44) (29)
___ ___ ___ _____ _____ _____ _____ _____ _____
Total investment
securities 287 (375) (88) 1,013 (460) 553 1,488 (997) 491
Federal funds sold (123) 25 (98) 45 (39) 6 124 (135) (11)
___ ___ ___ _____ _____ _____ _____ _____ _____
Total income
from earning assets 816 (764) 52 (597) (1,427) (2,024) 390 (3,138) (2,748)
INTEREST EXPENSE
Time and savings deposits:
Interest Bearing
transaction accounts 206 (96) 110 180 (235) (55) 424 (589) (165)
Money market
deposit accounts (8) 53 45 (9) (120) (129) 130 (371) (241)
Savings accounts 27 (127) (100) 274 (146) 128 298 (293) 5
Certificates of deposit,
$100,000 or more 34 (14) 20 (180) (106) (286) (258) (226) (484)
Other certificates
of deposit (74) (203) (277) (825) (1,018) (1,843) (649) (1,462) (2,111)
___ ___ ___ _____ _____ _____ _____ _____ _____
Total time and
savings deposits 185 (387) (202) (560) (1,625) (2,185) (55) (2,941) (2,996)
Federal funds purchased
and securities sold
under agreement to
repurchase (25) 91 66 35 (100) (65) (9) (305) (314)
Other short-term
borrowings 36 (17) 19 (9) 2 (7) (46) (6) (52)
___ ___ ___ _____ _____ _____ _____ _____ _____
Total expense for
interest bearing
liabilities 196 (313) (117) (534) (1,723) (2,257) (110) (3,252) (3,362)
CHANGE IN NET
INTEREST INCOME $ 620 $(451) $169 $ (63) $ 296 $ 233 $ 500 $ 114 $ 614
_________________________________________________________________________________________________________________________
<FN>
<F2>
*Computed on a fully taxable equivalent basis using a 34% rate.
</FN>
-4-
Interest Sensitivity
The following table reflects the earlier of the maturity or repricing data for
various assets and liabilities as of December 31, 1994.
TABLE III
INTEREST SENSITIVITY ANALYSIS
___________________________________________________________________________________________
As of December 31, 1994 Within 3 4 - 12 1 - 5 Over 5
Dollars in thousands months months years years Total
___________________________________________________________________________________________
Uses of funds:
Federal funds sold $ 247 $ --- $ --- $ --- $ 247
Investment securities:
Taxable 7,283 12,118 55,356 1,860 76,617
Tax-exempt 300 358 864 5,378 6,900
_______ ______ _______ ______ _______
Total investments 7,830 12,476 56,220 7,238 83,764
Loans:
Commercial 25,414 1,833 16,144 1,116 44,507
Tax-exempt 3,879 44 225 606 4,754
Installment 230 1,378 40,775 173 42,556
Real estate 14,270 5,565 54,089 7,678 81,602
Other 322 --- --- --- 322
_______ ______ _______ ______ _______
Total loans 44,115 8,820 111,233 9,573 173,741
_______ ______ _______ ______ _______
Total earning assets $ 51,945 $21,296 $167,453 $16,811 $257,505
Sources of funds:
Interest bearing
transaction accounts $ 50,575 $ --- $ --- $ --- $ 50,575
Money market
deposit accounts 18,330 --- --- --- 18,330
Savings accounts 28,081 --- --- --- 28,081
Certificates of deposit,
$100,000 or more 2,939 7,078 2,631 --- 12,648
Other certificates
of deposit 21,520 42,416 24,943 --- 88,879
Federal funds purchased
and securities sold
under agreements to
repurchase 13,263 431 --- --- 13,694
Other borrowings 1,095 --- 67 --- 1,162
_______ ______ _______ ______ _______
Total interest
bearing liabilities $135,803 $49,925 $ 27,641 $ 0 $213,369
Rate sensitivity gap $(83,858) $(28,629) $139,812 $ 16,811 $ 44,136
Cumulative gap $(83,858) $(112,487) $ 27,325 $ 44,136
____________________________________________________________________________________________
The Company was liability sensitive as of December 31, 1994. There were $83.9
million more in liabilities than assets subject to repricing within three
months. This generally indicates that net interest income should improve if
interest rates fall since liabilities will reprice faster than assets. It
should be noted, however, that savings deposits; which consist of interest
-5-
bearing transactions accounts, money market accounts, and savings accounts;
are less interest sensitive than other market driven deposits. In a rising
rate environment these deposit rates have historically lagged behind the
changes in earning asset rates, thus mitigating somewhat the impact from the
liability sensitivity position.
II. Investment Portfolio
TABLE IV
INVESTMENT SECURITIES
____________________________________________________________________________________________________________
THE AMORTIZED COST AND FAIR VALUE OF INVESTMENT SECURITIES HELD TO MATURITY
December 31, 1994
Carrying Unrealized Unrealized Market
(Dollars in Thousands) Value Gains Losses Value
____________________________________________________________________________________________________________
Obligations of States and
political subdivisions $919 $5 $(6) $918
=== = = ===
THE AMORTIZED COST AND FAIR VALUES OF INVESTMENT SECURITIES AVAILABLE FOR SALE
December 31, 1994
Amortized Unrealized Unrealized Market
(Dollars in Thousands) Cost Gains Losses Value
____________________________________________________________________________________________________________
United States Treasury securities $69,385 $ 18 $(2,751) $66,652
Obligations of other United States
Government agencies 4,999 17 (140) 4,876
Obligations of states and
political subdivisions 5,817 170 (5) 5,982
Other marketable equity securities,
at lower of cost or market 4,400 --- (223) 4,177
Federal Reserve Bank stock 85 --- --- 85
Federal Home Loan Bank stock 827 --- --- 827
______ ___ _____ ______
Total $85,513 $205 $(3,119) $82,599
====== === ===== ======
The amortized cost and fair value of investment securities
December 31, 1993
Carrying Unrealized Unrealized Market
(Dollars in Thousands) Amount Gains Losses Value
____________________________________________________________________________________________________________
United States Treasury securities $83,898 $2,325 $(178) $86,045
Obligations of other United States
Government agencies 5,003 422 --- 5,425
Obligations of states and
political subdivisions 6,738 494 --- 7,232
Other marketable equity securities,
at lower of cost or market 3,620 --- --- 3,620
Federal Reserve Bank stock 85 --- --- 85
______ _____ ___ _______
Total $99,344 $3,241 $(178) $102,407
====== ===== === =======
-6-
December 31, 1992
Carrying Unrealized Unrealized Market
(Dollars in Thousands) Amount Gains Losses Value
____________________________________________________________________________________________________________
United States Treasury securities $57,455 $1,792 $(21) $ 59,226
Obligations of other United States
Government agencies 6,170 424 --- 6,594
Obligations of states and
political subdivisions 9,766 422 (4) 10,184
Other marketable equity securities,
at lower of cost ($3,775) or market 3,764 --- --- 3,764
Federal Reserve Bank stock 85 --- --- 85
______ _____ __ _______
Total $77,240 $2,638 $(25) $79,853
====== ===== == =======
____________________________________________________________________________________________________________
Investment securities carried at $29.1 million, $30.4 million, and $27.1
million, at December 31, 1994, 1993, and 1992, respectively, were pledged to
secure public deposits and securities sold under agreements to repurchase and
for other purposes required or permitted by law.
The following table shows, by type and maturity, the book value and weighted
average yields of investment securities at December 31, 1994.
TABLE V
INVESTMENT SECURITY MATURITIES & YIELDS*<F3>
________________________________________________________________________________________________________
U.S.Govt/ Agency State/Municipal Total
Book Weighted Book Weighted Book Weighted
Value Average Value Average Value Average
Dollars in thousands Yield Yield Yield
________________________________________________________________________________________________________
December 31, 1994
Maturities:
Within 1 year $15,321 5.54% $ 650 9.80% $15,971 5.72%
After 1 year, but within 5 years 57,063 5.75% 853 9.71% 57,916 5.81%
After 5 years, but within 10 years 2,000 7.05% 3,761 9.46% 5,761 8.62%
After 10 years --- --% 1,472 9.66% 1,472 9.66%
TOTAL $74,384 5.74% $6,736 9.57% $81,120 6.06%
December 31, 1993 $88,900 5.85% $6,738 9.86% $95,638 6.13%
December 31, 1992 $63,626 6.49% $9,766 10.22% $73,392 7.00%
________________________________________________________________________________________________________
<FN>
<F3>
*Yields are calculated on a fully tax equivalent basis using a 34% rate.
The book value of other marketable equity securities with no stated maturity
totalled $5.23 million, yielding 4.41%; $3.62 million, yielding 4.23%; and
$3.76 million, yielding 5.06%; at December 31, 1994, 1993, and 1992
respectively. There were no other securities, except Federal Reserve Bank
stock, which remained constant for the period at $84,850, earning a six
percent (6%) dividend.
-7-
III. Loan Portfolio
The following table shows a breakdown of total loans by type at December 31
for years 1990 through 1994:
TABLE VI
LOANS
_______________________________________________________________________________________________________
As of December 31,
Dollars in thousands 1994 1993 1992 1991 1990
_______________________________________________________________________________________________________
Commercial and other $ 17,806 $ 16,836 $ 17,043 $ 20,836 $ 27,051
Real Estate Construction 1,991 2,353 2,420 6,570 9,637
Real Estate Mortgage 105,703 96,185 105,424 110,990 102,353
Tax Exempt Loans 4,754 5,585 6,987 7,717 8,512
Installment Loans to Individuals
(net of Unearned Income) 43,487 29,322 29,640 34,069 40,230
Total $173,741 $150,282 $161,514 $180,182 $187,783
_______________________________________________________________________________________________________
Based on Standard Industry Code, there are no categories of loans which exceed
10% of total loans other than the categories disclosed in the preceding table.
The maturity distribution and rate sensitivity of certain categories of the
Bank's loan portfolio at December 31, 1994 is presented below:
TABLE VII
MATURITY SCHEDULE OF SELECTED LOANS
______________________________________________________________________________________________________________
December 31, 1994 One year One through Over five
Dollars in thousands or less five years years Total
______________________________________________________________________________________________________________
Commercial and other $ 8,004 $ 9,802 --- $17,806
Real estate construction 1,871 120 --- 1,991
Total $ 9,875 $ 9,922 --- $19,797
Loans maturing after one year with:
Fixed interest rate $ 3,403 --- $ 3,403
Variable interest rate $ 6,399 --- $ 6,399
______________________________________________________________________________________________________________
-8-
The following table presents information concerning the aggregate amount of
nonaccrual, past due and restructured loans as of December 31 for the years
1990 through 1994.
TABLE VIII
NONACCRUAL, PAST DUE AND RESTRUCTURED LOANS
__________________________________________________________________________________________________
As of December 31,
Dollars in thousands 1994 1993 1992 1991 1990
__________________________________________________________________________________________________
Nonaccrual loans $2,955 $5,328 $4,670 $ 128 $ 487
Accruing loans past due
90 days or more 837 458 2,239 1,827 962
Restructured loans none none none none none
Interest income which would
have been recorded under
original loans terms 470 570 783 88 123
Interest income recorded
during the period 188 239 478 1 40
__________________________________________________________________________________________________
Loans are placed in nonaccrual status if principal or interest has been in
default for a period of 90 days or more unless the obligation is both well
secured and in the process of collection. A debt is "well secured" if it is
secured (i) by collateral in the form of liens on or pledges of real or
personal property, including securities, that have a realizable value
sufficient to discharge the debt in full or (ii) by the guaranty of a
financially responsible party. A debt is "in the process of collection" if
collection of the debt is proceeding in due course either through legal
action, including judgment enforcement procedures, or, in appropriate
circumstances, through collection efforts not involving legal action which are
reasonably expected to result in repayment of the debt or in its restoration
to a current status.
Potential problem loans consist of loans that, because of potential credit
problems of the borrowers, have caused management to have serious doubts as
to the ability of such borrowers to comply with the loan repayment terms. At
December 31, 1994 such problem loans, not included in Table VIII, amounted to
approximately $6.3 million. The potential problem loans included three
relationships in excess of $500 thousand. The potential problem loans are
generally secured by residential and commercial real estate with appraised
values exceeding the principal balance of the loan.
IV. Summary of Loan Loss Experience
The determination of the balance of the Allowance for Loan Losses is based
upon a review and analysis of the loan portfolio and reflects an amount which,
in management's judgment, is adequate to provide for possible future losses.
Management's review includes monthly analysis of past due and nonaccrual loans
and detailed periodic loan by loan analyses.
The principal factors considered by management in determining the adequacy of
the allowance are the growth and composition of the loan portfolio, historical
loss experience, the level of nonperforming loans, economic conditions, the
value and adequacy of collateral, and the current level of the allowance.
-9-
The following table shows an analysis of the Allowance for Loan Losses for the
years 1990 through 1994.
TABLE IX
ANALYSIS OF THE ALLOWANCE FOR LOAN LOSSES
_________________________________________________________________________________________________________
For the year ended December 31,
Dollars in thousands 1994 1993 1992 1991 1990
_________________________________________________________________________________________________________
Balance at beginning of period $2,692 $3,719 $3,233 $1,776 $1,521
Charge Offs:
Commercial, financial and agricultural 147 1,178 1,610 1,280 136
Real estate construction --- --- --- --- ---
Real estate mortgage 316 230 152 217 58
Installment Loans to individuals 148 179 287 402 328
_____ _____ _____ _____ _____
Total charge offs 611 1,587 2,049 1,899 522
Recoveries:
Commercial, financial and agricultural 431 174 80 14 14
Real estate construction --- --- --- --- ---
Real estate mortgage 19 7 14 12 ---
Installment Loans to individuals 91 129 141 130 63
_____ _____ _____ _____ _____
Total recoveries 541 310 235 156 77
Net charge offs 70 1,277 1,814 1,743 445
Additions charged to operations 25 250 2,300 3,200 700
_____ _____ _____ _____ _____
Balance at end of period $2,647 $2,692 $3,719 $3,233 $1,776
Selected loan loss statistics
Loans (net of unearned income):
End of period $173,741 $150,282 $161,514 $180,182 $187,782
Daily average $160,204 $155,551 $173,172 $184,751 $183,531
Net charge offs to
average total loans .04% 0.82% 1.05% 0.94% 0.24%
Provision for loan losses
to average total loans .02% 0.16% 1.33% 1.73% 0.38%
Provision for loan losses to
net charge offs 35.71% 19.58% 126.79% 183.59% 157.30%
Allowance for loan losses to
period end loans 1.52% 1.79% 2.30% 1.79% 0.95%
Earnings to
loan loss coverage*<FN4> 56.21 2.45 2.43 2.83 8.41
_________________________________________________________________________________________________________
<FN>
<F4>
*Income before income taxes plus provision for loan losses, divided by
net charge-offs.
</FN>
-10-
The following table shows the amount of the Allowance for Loan Losses
allocated to each category at December 31 for the years 1990 through 1994.
TABLE X
ALLOCATION OF THE ALLOWANCE FOR LOAN LOSSES
__________________________________________________________________________________________________________________________________
As of December 31, 1994 1993 1992 1991<F5> 1990<F5>
Percent Percent Percent Percent Percent
of Loans of Loans of Loans of Loans of Loans
in Each in Each in Each in Each in Each
Category Category Category Category Category
to Total to Total to Total to Total to Total
(Dollars in Thousands) Amount Loans Amount Loans Amount Loans Amount Loans Amount Loans
___________________________________________________________________________________________________________________________________
Commercial and other $1,334 12.98% $1,779 28.96% $2,713 29.29% $1,101 34.07% $ 569 32.02%
Real estate construction 21 1.15% 27 1.52% 51 1.50% 43 1.34% 91 5.13%
Real estate mortgage 912 60.84% 740 49.81% 709 50.90% 1,521 47.03% 756 42.56%
Consumer 380 25.03% 146 19.71% 246 18.31% 568 17.56% 360 20.29%
_____ ______ _____ ______ _____ ______ _____ ______ _____ ______
Total $2,647 100.00% $2,692 100.00% $3,719 100.00% $3,233 100.00% $1,776 100.00%
__________________________________________________________________________________________________________________________________
<FN>
<F5>
The allocation amounts for 1990 and 1991 have been reclassified to reflect the
classification adopted in 1992.
</FN>
V. Deposits
The following table shows the average balances and average rates paid on
deposits for the years ended December 31, 1992, 1993, and 1994.
TABLE XI
DEPOSITS
_________________________________________________________________________________________________________________________________
For the year ended December 31, 1994 1993 1992
Dollars in thousands Average Average Average Average Average Average
Balance Rate Balance Rate Balance Rate
_________________________________________________________________________________________________________________________________
Interest bearing transaction accounts $ 50,739 2.62% $ 43,406 2.80% $ 38,013 3.35%
Money market deposit accounts 19,526 3.14% 19,797 2.87% 20,051 3.48%
Savings accounts 30,070 2.75% 29,203 3.17% 21,731 3.67%
Certificates of deposit, $100,000 or more 10,979 4.35% 10,217 4.48% 13,467 5.52%
Other certificates of deposit 83,512 4.61% 85,029 4.85% 98,661 6.05%
_______ _______ _______
Total interest bearing deposits 194,826 3.64% 187,652 3.89% 191,923 4.94%
Non-interest bearing demand deposits 40,004 40,870 36,799
_______ _______ _______
Total deposits $234,830 $228,522 $228,722
_________________________________________________________________________________________________________________________________
-11-
The following table shows certificates of deposit in amounts of $100,000
or more as of December 31, 1994, 1993, and 1992 by time remaining until
maturity.
TABLE XII
CERTIFICATES OF DEPOSIT $100,000 & MORE
______________________________________________________________________
(Dollars in thousands) 1994 1993 1992
Maturing in
______________________________________________________________________
3 months or less $ 1,941 $ 3,359 $ 3,402
3 through 6 months 1,464 2,451 1,630
6 through 12 months 5,714 2,593 2,191
over 12 months 3,529 1,830 2,797
______ ______ ______
Total $12,648 $10,233 $10,020
______________________________________________________________________
VI. Return on Equity and Assets
The return on average shareholders' equity and assets, the dividend pay out
ratio, and the average equity to average assets ratio for the past three years
are presented below.
1994 1993 1992
__________________________________________________________________________
Return on average assets 1.00% 0.82% 0.65%
Return on average equity 10.39% 8.90% 7.29%
Dividend payout ratio 25.03% 28.17% 28.40%
Average equity to average assets 9.59% 9.20% 8.87%
__________________________________________________________________________
VII. Short Term Borrowings
The Bank periodically borrowed funds through federal funds from its
correspondent banks, through the use of a demand note to the United States
Treasury (Treasury Tax and Loan Deposits), and through securities sold under
agreements to repurchase. The borrowings matured daily and were based on
daily cash flow requirements. The borrowed amounts (in thousands) and their
corresponding rates during 1994, 1993, and 1992 are presented below:
-12-
TABLE XIII
SHORT TERM BORROWINGS
______________________________________________________________________________________________________________________________
1994 1993 1992
Dollars in thousands Balance Rate Balance Rate Balance Rate
______________________________________________________________________________________________________________________________
Balance at December 31,
Federal funds purchased $ 2,930 5.88% $ --- 3.19% $ --- 3.19%
Securities sold under
agreements to repurchase 10,764 4.54% 12,845 2.74% 11,782 2.86%
U.S. treasury demand notes
and other borrowed money 1,162 5.42% 92 7.36% 115 7.50%
______ ______ ______
Total $14,789 $12,937 $11,897
Average daily balance outstanding:
Federal funds purchased $ 932 4.77% $ 3 2.90% $ 6 3.58%
Securities sold under
agreements to repurchase 13,596 3.37% 15,395 2.84% 14,384 3.49%
U.S. treasury demand notes
and other borrowed money 617 4.55% 122 6.85% 299 5.35%
______ ______ ______
Total $15,145 3.50% $12,589 2.87% $14,689 3.53%
The maximum amount outstanding
at any month end:
Federal funds purchased $ 4,600 $ --- $ ---
Securities sold under
agreements to repurchase $18,598 $20,202 $16,183
U.S. treasury demand notes
and other borrowed money $ 4,072 $ 397 $ 2,134
______________________________________________________________________________________________________________________________
Item 2. Description of Property
The Bank owns the Main Office, an office building, seven branches, and two
future branch sites. All of the above properties are owned directly and free
of any encumbrances. The land at the Fort Monroe branch is leased by the Bank
under an agreement expiring in October 2011. The remaining three branches are
leased from unrelated parties under leases with renewal options which expire
anywhere from 10-20 years. The Bank has received approval for a new branch
which will be located at Kiln Creek Parkway near Victory Blvd. and is
scheduled to open in 1995.
The Bank has noncancellable leases on premises and equipment expiring at
various dates, including extensions to the year 2011. Certain leases provide
for increased annual payments based on increases in real estate taxes and the
Consumer Price Index.
-13-
The total approximate minimum rental commitment at December 31, 1994, under
noncancellable leases is $630 thousand which is due as follows:
Year (Dollars in Thousands)
1995 $144
1996 76
1997 78
1998 79
1999 80
Remaining term of leases 173
___
Total $630
===
The aggregate rental expense of premises and equipment was $178 thousand, $140
thousand, and $148 thousand for 1994, 1993 and 1992, respectively.
As of December 31, 1993 the Company owned a building with an adjoining vacant
lot which was held for sale and classified as Other Real Estate Owned. This
property was sold on March 11, 1994.
Additional information on Other Real Estate Owned is as follows:
(Dollars in Thousands) 1994 1993 1992
Foreclosed real estate $214 $430 $ 453
In-substance foreclosed real estate --- --- 2,642
Property held for sale --- 435 500
___ ___ _____
Total $214 $865 $3,595
=== === =====
Item 3. Legal Proceedings
The Company is not a party to any material pending legal proceedings before
any court, administrative agency, or other tribunal.
Item 4. Submission of Matters to a Vote of Security Holders
There were no matters submitted to a vote of security holders during the
quarter ended December 31, 1994.
-14-
Part II
Item 5. Market for Common Equity And Related Stockholder Matters
The common stock of Old Point Financial Corporation is not listed on an
exchange and is not quoted by NASDAQ. The approximate number of shareholders
of record as of December 31, 1994 was 1,364. The range of high and low prices
and dividends per share of the Company's common stock for each quarter during
1994 and 1993 is presented in Part I. Item 7. of this Annual Report on Form
10-K.
Old Point National Bank is subject to certain requirements imposed by federal
banking statutes and regulations. The Bank is limited in what dividends it
can pay to the parent company. Pursuant to Section 33(a) of the National Bank
Act, approval from the Office of the Comptroller of the Currency (OCC) must
be obtained if the total of all dividends declared by the Bank in any given
year exceeds the total of the Bank's net profits for that year plus the net
profits after payment of dividends for the two preceding years. Accordingly,
$5.6 million of retained earnings was available for payment of dividends from
the Bank to the Company at December 31, 1994.
Item 6. Selected Financial Data
The following table summarizes the Company's performance for the past five
years.
-15-
TABLE XIV
SELECTED FINANCIAL DATA
_______________________________________________________________________________________________
Dollars in thousands YEAR ENDED DECEMBER 31,
except per share data 1994 1993 1992 1991 1990
_______________________________________________________________________________________________
RESULTS OF OPERATIONS
Interest income $19,234 $19,105 $20,988 $23,654 $23,211
Interest expense 7,625 7,743 9,999 13,361 13,451
______ ______ ______ ______ ______
Net interest income 11,609 11,362 10,989 10,293 9,760
Provision for loan loss 25 250 2,300 3,200 700
______ ______ ______ ______ ______
Net interest income after
provision for loan loss 11,584 11,112 8,689 7,093 9,060
Gains on sales of
investment securities 407 19 463 480 16
Noninterest income 3,755 4,003 3,589 3,325 2,703
Noninterest expenses 11,837 12,252 10,627 9,157 8,736
______ ______ ______ ______ ______
Income before taxes 3,909 2,882 2,114 1,741 3,043
Applicable income taxes 1,136 667 376 279 624
______ ______ ______ ______ ______
Net income 2,773 2,215 1,738 1,462 2,419
FINANCIAL CONDITION
Total assets $277,680 $273,884 $268,721 $266,032 $247,801
Total deposits 235,599 234,171 231,509 227,139 206,341
Total loans 173,741 150,282 161,514 180,182 187,783
Stockholders' equity 26,222 25,836 24,193 22,932 21,955
Average assets 278,398 270,685 268,917 258,662 237,315
Average equity 26,694 24,897 23,856 22,996 20,927
PERTINENT RATIOS
Pertinent ratios are provided in Part I, Item 1., Return on Equity and Assets, of this Annual Report on form 10-K
PER SHARE DATA
Earnings per share $ 2.20 $ 1.77 $ 1.41 $ 1.19 $ 1.96
Cash dividends declared 0.55 0.50 0.40 0.40 0.40
Book value 20.75 20.60 19.47 18.59 17.81
GROWTH RATES
Year end assets 1.39% 1.92% 1.01% 7.36% 13.59%
Year end deposits 0.61% 1.15% 1.92% 10.08% 11.47%
Year end loans 15.61% -6.95% -10.36% -4.05% 10.11%
Year end equity 1.49% 6.79% 5.50% 4.45% 10.34%
Average assets 2.85% 0.66% 3.96% 9.00% 14.80%
Average equity 7.22% 4.36% 3.74% 9.89% 12.11%
Net income 25.19% 27.45% 18.88% -39.56% 0.62%
Cash dividends declared 10.00% 25.00% 0.00% 0.00% 6.67%
Book value 0.72% 5.78% 4.73% 4.41% 9.82%
_______________________________________________________________________________________________
-16-
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The following discussion is intended to assist readers in understanding
and evaluating the consolidated results of operations and financial condition
of the Company. This discussion should be read in conjunction with the
financial statements and other financial information contained elsewhere in
this report. The analysis attempts to identify trends and material changes
which occurred during the period presented.
EARNINGS SUMMARY
Net income was $2.77 million, or $2.20 per share in 1994 compared to
$2.21 million, or $1.77 per share in 1993 and $1.74 million, or $1.41 per
share in 1992. Return on average assets was 1.00% in 1994, 0.82% in 1993, and
0.65% in 1992. Return on average equity was 10.39% in 1994, 8.90% in 1993 and
7.29% in 1992. For the past five years return on average assets has averaged
0.81% and return on average equity has averaged 8.90%. Highlights (found in
Part II, Item 6 of this Annual Report on Form 10-K) on page 1 summarizes the
Company's performance for the past five years.
NET INTEREST INCOME
The principal source of earnings for the Company is net interest income.
Net interest income is the difference between interest and fees generated by
earning assets and interest expense paid to fund them. Net interest income,
on a tax equivalent basis, was $11.98 million in 1994, up $169 thousand, or
1% from $11.81 million in 1993 which was up $233 thousand, or 2% from $11.58
million in 1992. Net interest income is affected by variations in interest
rates and the volume and mix of earning assets and interest-bearing
liabilities. The net interest yield decreased to 4.63% in 1994 from 4.73% in
1993 which was up from 4.63% in 1992.
Tax equivalent interest income for 1994 increased $52 thousand. Average
earning assets grew $9.02 million, or 4%. Despite this volume growth interest
income increased only slightly due to a 26 basis point decline in the average
rate earned. In 1994, total average loans increased $7.41 million, or 5%,
while average investment securities increased $5.70 million, or 7%.
Interest expense declined $118 thousand, or 2%, in 1994 due to an 18
basis point decline in the average rate paid. Based on average balances, the
mix of interest bearing liabilities shifted in 1994 to lower paying savings
and interest checking accounts from higher paying certificates of deposit.
PROVISION/ALLOWANCE FOR LOAN LOSSES
Provision for loan losses is a charge against earnings necessary to
maintain the allowance for loan losses at a level consistent with management's
evaluation of the loan portfolio. The 1994 provision was $25 thousand
compared to $250 thousand in 1993 and $2.30 million in 1992. Loans charged
off during 1994 totalled $611 thousand compared to $1.59 million in 1993 and
$2.05 million in 1992, while recoveries amounted to $540 thousand in 1994,
$310 thousand in 1993 and $235 thousand in 1992. Net loans charged off to
year-end loans were 0.04% in 1994, 0.85% in 1993, and 1.12% in 1992. The
allowance for loan losses, as a percentage of year-end loans, was 1.52% in
1994, 1.79% in 1993, and 2.30% in 1992.
-17-
As of December 31, 1994 nonperforming assets were $3.17 million, down
from $6.19 million at year-end 1993 which was down from $8.26 million at year-
end 1992. Nonperforming assets consist of loans in nonaccrual status and
foreclosed real estate. The 1994 total consisted of foreclosed real estate
of $214 thousand and $2.96 million in nonaccrual loans. The foreclosed real
estate consisted of $137 thousand in foreclosed commercial property, and $77
thousand in 1-4 family residences. Nonaccrual loans consisted of $1.25
million in commercial loans and $1.71 million in mortgage loans. The Company
has aggressively dealt with these credits and specific action plans have been
developed for each of these classified loans to address any deficiencies.
Loans still accruing interest but past due 90 days or more increased to $837
thousand as of December 31, 1994 compared to $458 thousand as of December 31,
1993 and $2.24 million as of December 31, 1992.
The allowance for loan losses is analyzed for adequacy on a quarterly
basis to determine the required amount of provision for loan losses. A loan-
by-loan review is conducted on all significant classified commercial and
mortgage loans. Inherent losses on these individual loans are determined and
an allocation of the allowance is provided. Smaller nonclassified commercial
and mortgage loans and all consumer loans are grouped by homogeneous pools
with an allocation assigned to each pool based on an analysis of historical
loss and delinquency experience, trends, economic conditions, underwriting
standards, and other factors.
OTHER INCOME
Other income increased $140 thousand, or 3% in 1994 over 1993 compared
to a decrease of $30 thousand, or 1% in 1993 over 1992. Trust income rose 10%
in 1994 compared to an increase of 13% in 1993. This increase was due
primarily to growth in trust assets under management. Service charges on
deposits remained constant in 1994 compared to a decrease of 2% in 1993.
Other service charges, commissions and fees were down in 1994 due to lower
mortgage brokerage fees. Security gains were up substantially in 1994. These
security gains were the result of the sale of investment securities as an
asset/liability strategy to reduce the interest rate risk in the portfolio.
These securities had been reclassified as "available for sale" as of January
1, 1994 in conjunction with the implementation of SFAS 115, "Accounting for
Certain Investments in Debt and Equity Securities".
OTHER EXPENSES
Other expenses decreased $415 thousand, or 3%, in 1994 from 1993 after
increasing $1.63 million, or 15%, in 1993 over 1992. Salaries and employee
benefits increased 4% in 1994 due to normal salary increases and increased
profit sharing contributions. Equipment expense decreased 7%, due to the
cancellation of service contracts on certain computer equipment. Other
operating expenses decreased 15% due to the reduction in costs associated with
loan administration and foreclosed properties.
ASSETS
At December 31, 1994, the Company had total assets of $277.7 million, up
1% from $273.9 million at December 31, 1993. Average assets in 1994 were
$278.4 million compared to $270.7 million in 1993. The marginal growth in
assets in 1994 and 1993 was due to the strong competition for deposits in the
Company's market area.
-18-
LOANS
The Company experienced very strong loan demand in 1994. Total loans
(net of unearned income) as of December 31, 1994 were $173.7 million, up 16%
from $150.3 million at December 31, 1993. All categories of loans increased
during 1994 except tax exempt loans and real estate - construction loans.
Footnote 3 of the financial statements details the loan volume by category for
the past three years.
INVESTMENT SECURITIES
At December 31, 1994 total investment securities were $83.5 million, down
16% from $99.3 million on December 31, 1993. The decline in the investment
portfolio was due to the growth in loans as maturing securities were
reinvested in loans. The Company implemented Statement of Financial
Accounting Standards (SFAS) 115, "Accounting for Certain Investments in Debt
and Equity Securities" beginning January 1, 1994. At that time the Company
elected to classify its entire investment securities portfolio as available
for sale. During the first quarter of 1994 the Company sold certain
securities and the proceeds were reinvested in loans. The goal of the Company
is to provide maximum return on the investment portfolio within the framework
of its asset/liability objectives. These objectives include managing interest
sensitivity, liquidity and pledging requirements.
DEPOSITS
At December 31, 1994, total deposits amounted to $235.6 million, up 1%
from $234.2 million on December 31, 1993. Noninterest bearing deposits
decreased $2.5 million, or 6%, in 1994 from 1993. Savings deposits decreased
$5.0 million, or 5%, in 1994 from 1993. Certificates of Deposit increased
$8.9 million, or 10% in 1994 over 1993. Due to the increase in interest
rates, customers are now investing in certificates of deposits.
STOCKHOLDERS' EQUITY
Total stockholders' equity as of December 31, 1994 was $26.2 million, up
1% from $25.8 million on December 31, 1993. The Company is required to
maintain minimum amounts of capital under banking regulations. Under the
regulations Total Capital is composed of core capital (Tier 1) and
supplemental capital (Tier 2). Tier 1 capital consists of common
stockholder's equity less goodwill and excluding SFAS 115 market adjustment
for available for sale securities. Tier 2 capital consists of certain
qualifying debt and a qualifying portion of the allowance for loan losses.
The following is a summary of the Company's capital ratios for 1994, 1993, and
1992.
1994 Regulatory Requirements 1994 1993 1992
Tier 1 4.00% 16.32% 17.16% 14.79%
Total Capital 8.00% 17.57% 18.42% 16.05%
Tier 1 Leverage 3.00% 10.00% 9.32% 9.02%
Year-end book value was $20.75 in 1994 and $20.60 in 1993. Cash
dividends were $693,828 or $.55 per share in 1994 and $624,002 or $.50 per
share in 1993. The common stock of the Company has not been extensively
traded. The stock is not listed on an exchange and is not quoted by NASDAQ.
-19-
Bid and ask prices are not available for the Company. The volume of trading
of the stock is therefore limited. The prices below are based upon a limited
number of transactions known to Management during the past two years. There
were 1,364 stockholders of the Company as of December 31, 1994. This
stockholder count does not include stockholders who hold their stock in a
nominee registration. The following is a summary of the dividends paid and
market price on Old Point Financial Corporation common stock for 1994 and
1993. On May 14, 1993 the company paid a 100% stock dividend. All prior
dividends and stock prices have been restated to reflect this stock dividend.
1994 Market Value 1993 Market Value
Dividend High Low Dividend High Low
1st Quarter $ 0.125 $ 35.00 $ 35.00 $ 0.125 $ 25.00 $ 25.00
2nd Quarter $ 0.125 $ 37.50 $ 35.00 $ 0.125 $ 30.00 $ 25.00
3rd Quarter $ 0.15 $ 37.50 $ 35.00 $ 0.125 $ 35.00 $ 30.00
4th Quarter $ 0.15 $ 37.00 $ 36.00 $ 0.125 $ 35.00 $ 35.00
LIQUIDITY
Liquidity is the ability of the Company to meet present and future
obligations through the acquisition of additional liabilities or sale of
existing assets. Management considers the liquidity of the Company to be
adequate. Sufficient assets are maintained on a short-term basis to meet the
liquidity demands anticipated by Management. In addition, secondary sources
are available through the use of borrowed funds if the need should arise.
EFFECTS OF INFLATION
Management believes that the key to achieving satisfactory performance
in an inflationary environment is its ability to maintain or improve its net
interest margin and to generate additional fee income. The Company's policy
of investing in and funding with interest-sensitive assets and liabilities is
intended to reduce the risks inherent in a volatile inflationary economy.
Item 8. Financial Statements and Supplementary Data
The consolidated financial statements and related footnotes of the Company are
presented below followed by the financial statements of the parent.
-20-
_______________________________________________________________________________________________
CONSOLIDATED BALANCE SHEETS
December 31, 1994 1993 1992
_______________________________________________________________________________________________
(Dollars in Thousands)
ASSETS
Cash and due from banks $ 8,941 $ 8,166 $ 10,172
Investments:
Securities available for sale, at market 82,599 --- ---
Securities to be held to maturity
(Market value $918) 919 --- ---
Investment securities
(Market value $102,407 in 1993, and
$79,853 in 1992) --- 99,344 77,240
Federal funds sold 247 4,800 7,320
Loans, total (excluding unearned income) 173,741 150,282 161,514
Less - allowance for loan losses 2,647 2,692 3,719
_______ _______ _______
Net loans 171,094 147,590 157,795
Premises and equipment 7,433 8,139 7,981
Other real estate owned 214 865 3,595
Other assets 6,233 4,980 4,618
_______ _______ _______
Total assets $277,680 $273,884 $268,721
======= ======= =======
LIABILITIES
Non-interest bearing deposits $ 37,086 $ 39,581 $ 43,395
Savings deposits 96,986 101,994 88,375
Certificates of deposit 101,527 92,596 99,739
_______ _______ _______
Total deposits 235,599 234,171 231,509
Federal funds purchased and securities
sold under repurchase agreements 13,694 12,845 11,783
Interest bearing demand notes issued
to the United States Treasury and
other liabilities for borrowed money 1,162 92 115
Other liabilities 1,003 940 1,121
_______ _______ _______
Total liabilities 251,458 248,048 244,528
STOCKHOLDERS' EQUITY
Common stock, $5 par value 6,320 6,271 3,106
1994 1993 1992
Shares authorized: 3,000 3,000 3,000
Shares outstanding: 1,264 1,254 621
Capital surplus 9,032 8,738 5,396
Retained earnings 12,793 10,856 15,703
Unrealized loss on securities (1,923) (29) (12)
_______ _______ _______
Total stockholders' equity 26,222 25,836 24,193
_______ _______ _______
Total liabilities and stockholders' equity $277,680 $273,884 $268,721
======= ======= =======
_______________________________________________________________________________________________
-21-
_______________________________________________________________________________________________
CONSOLIDATED STATEMENTS OF INCOME
Years Ended December 31, 1994 1993 1992
_______________________________________________________________________________________________
(Dollars in thousands except per share amounts)
INTEREST INCOME
Interest and fees on loans $13,757 $13,497 $16,025
Interest on investment securities
Taxable 4,932 4,840 3,698
Exempt from Federal income tax 414 523 689
______ ______ ______
5,346 5,363 4,387
Interest on trading account securities --- 16 2
Interest on securities available for sale --- --- 351
Interest on federal funds sold 131 229 223
______ ______ ______
Total interest income 19,234 19,105 20,988
INTEREST EXPENSE
Interest on savings deposits 2,766 2,710 2,767
Interest on certificates of deposit 4,328 4,587 6,714
Interest on federal funds purchased and
securities sold under repurchase agreements 503 437 502
Interest on demand notes issued to
the United States Treasury and other
liabilities for borrowed money 28 9 16
______ ______ ______
Total interest expense 7,625 7,743 9,999
______ ______ ______
Net interest income 11,609 11,362 10,989
Provision for loan losses 25 250 2,300
______ ______ ______
Net interest income after provision
for loan losses 11,584 11,112 8,689
OTHER INCOME
Income from fiduciary activities 1,463 1,336 1,181
Service charges on deposit accounts 1,780 1,777 1,819
Other service charges, commissions and fees 290 651 401
Security gains, net 407 19 463
Income from trading account --- 62 8
Other operating income 222 177 180
______ ______ ______
Total other income 4,162 4,022 4,052
OTHER EXPENSE
Salaries and employee benefits 7,050 6,807 5,954
Occupancy expense 700 748 699
Equipment expense 1,116 1,199 918
Other expense 2,971 3,498 3,056
______ ______ ______
Total other expenses 11,837 12,252 10,627
______ ______ ______
Income before income taxes 3,909 2,882 2,114
Income taxes 1,136 667 376
______ ______ ______
Net income $ 2,773 $ 2,215 $ 1,738
====== ====== ======
PER SHARE
Average shares outstanding 1,260 1,248 1,234
Net income per share of common stock
(1992 restated for 2 for 1 stock split in 1993) $2.20 $1.77 $1.41
_______________________________________________________________________________________________
-22-
_______________________________________________________________________________________________
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years Ended December 31, 1994 1993 1992
_______________________________________________________________________________________________
(Dollars in Thousands)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 2,773 $ 2,215 $ 1,738
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 884 919 704
Provision for loan losses 25 250 2,300
Market write-downs on other real estate owned --- 65 209
Securities gains net (407) (19) (463)
Net amortization and accretion of
investment securities 1,340 759 703
Changes in assets and liabilities:
Increase in other real estate owned (13) (767) (2,628)
Increase in other assets (262) (362) (422)
Decrease (increase) in other liabilities 63 (181) (397)
_______ _______ _______
Net cash provided by operating activities 4,403 2,879 1,744
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of investment securities (8,902) (37,364) (45,910)
Proceeds from maturities and calls of
investment securities 11,928 14,377 4,912
Proceeds from sales of investment securities 8,982 125 26,347
Loans made to customers (120,330) (97,917) (78,480)
Principal reductions on loans 96,801 107,872 95,334
Purchase of premises and equipment (178) (1,077) (1,144)
Proceeds from sales of other real estate owned 664 3,431 1,034
(Increase) decrease in federal funds sold 4,553 2,520 (3,570)
_______ _______ _______
Net cash used in investing activities (6,482) (8,033) (1,477)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in
non-interest bearing deposits (2,494) (3,814) 8,707
Increase (decrease) in savings accounts (5,009) 13,620 21,193
Proceeds from sales of
certificates of deposit 67,378 37,379 62,041
Payments for maturing
certificates of deposit (58,447) (44,522) (87,572)
Increase (decrease) in federal
funds purchased and securities
sold under repurchase agreements 849 1,062 (2,523)
Increase/decrease in interest bearing
demand notes and other borrowed money 1,070 (23) (21)
Proceeds from issuance of common stock 200 70 28
Dividends paid (693) (624) (493)
_______ _______ _______
Net cash provided by financing activities 2,854 3,148 1,360
Net increase (decrease) in
cash and due from banks 775 (2,006) 1,627
Cash and due from banks at beginning of year 8,166 10,172 8,545
_______ _______ _______
Cash and due from banks at end of year $ 8,941 $ 8,166 $ 10,172
======= ======= =======
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Net cash paid for:
Interest expense $ 7,561 $ 7,859 $ 10,459
Income taxes $ 980 $ 375 $ 704
_______________________________________________________________________________________________
-23-
________________________________________________________________________________________________________________________________
CONSOLIDATED STATEMENTS OF
CHANGES IN STOCKHOLDERS' EQUITY
Years Ended December 31, 1994, 1993 and 1992
(Dollars in Thousands)
Unrealized
Common Loss on Total
Stock Capital Retained Investment Stockholders'
(Par Value) Surplus Earnings Securities Equity
________________________________________________________________________________________________________________________________
YEAR ENDED DECEMBER 31, 1992
Balance, beginning of year $3,083 $5,235 $14,613 $ --- $22,931
Net income --- --- 1,738 --- 1,738
Sale of stock 23 161 (155) --- 29
Increase in unrealized loss on
marketable equity securities --- --- --- (12) (12)
Cash dividends paid --- --- (493) --- (493)
_____ _____ ______ _____ ______
Balance, end of year $3,106 $5,396 $15,703 $ (12) $24,193
===== ===== ====== ===== ======
YEAR ENDED DECEMBER 31, 1993
Balance, beginning of year $3,106 $5,396 $15,703 $ (12) $24,193
Net income --- --- 2,215 --- 2,215
Sale of stock 50 227 (207) --- 70
Stock dividend declared on
common stock 3,115 3,115 (6,230) --- ---
Increase in unrealized loss on
marketable equity securities --- --- --- (17) (17)
Cash dividends paid --- --- (625) --- (625)
_____ _____ ______ _____ ______
Balance, end of year $6,271 $8,738 $10,856 $ (29) $25,836
===== ===== ====== ===== ======
YEAR ENDED DECEMBER 31, 1994
Balance, beginning of year $6,271 $8,738 $10,856 $ (29) $25,836
Net income --- --- 2,773 --- 2,773
Sale of stock 49 294 (142) --- 201
Increase in unrealized loss on
investment securities --- --- --- (1,894) (1,894)
Cash dividends paid --- --- (694) --- (694)
_____ _____ ______ _____ ______
Balance, end of year $6,320 $9,032 $12,793 $(1,923) $26,222
===== ===== ====== ===== ======
___________________________________________________________________________________________________________________________
-24-
Eggleston, Smith,
Hall, Cotman & Company
Certified Public Accountants and Consultants
Independent Auditors' Report
To the Board of Directors
Old Point Financial Corporation
Hampton, Virginia
We have audited the accompanying consolidated balance sheets of Old Point
Financial Corporation and subsidiary as of December 31, 1994, 1993 and
1992, and the related consolidated statements of income, cash flows and
changes in stockholders' equity for each of the three years in the period
ended December 31, 1994. These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion
on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the consolidated financial
statements are free of material misstatement. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
consolidated financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above,
present fairly, in all material respects, the consolidated financial
position of Old Point Financial Corporation and subsidiary as of December
31, 1994, 1993 and 1992, and the consolidated results of their operations
and cash flows for each of the three years in the period ended December 31,
1994, in conformity with generally accepted accounting principles.
As discussed in Note 1. to the financial statements, Old Point Financial
Corporation changed its method of accounting for debt and equity securities
effective January 1, 1994.
January 13, 1995
Newport News, Virginia
/s/ Eggleston, Smith, Hall, Cotman & Company
-25-
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. SIGNIFICANT ACCOUNTING POLICIES
_______________________________________
The accounting and reporting policies of Old Point Financial Corporation
and its subsidiary conform to generally accepted accounting principles and
to general practice within the banking industry. The following is a
summary of significant accounting and reporting policies:
PRINCIPLES OF CONSOLIDATION:
The consolidated financial statements include the accounts of Old
Point Financial Corporation ("the Company") and its subsidiary The Old
Point National Bank of Phoebus ("the Bank"). All significant intercompany
balances and transactions have been eliminated in consolidation.
INVESTMENT SECURITIES:
The Corporation adopted Statement of Financial Accounting Standards
No. 115, "Accounting for Certain Investments in Debt and Equity Securities"
(SFAS 115), for the year ended December 31, 1994. This statement addresses
the accounting and reporting for investments in equity securities that have
readily determinable fair values and for all investments in debt
securities. Those investments are to be classified in three categories and
accounted for as follows:
- Held to maturity - Debt securities for which the Company has the
positive intent and ability to hold to maturity are classified as held to
maturity securities and reported at cost, adjusted for premiums and
discounts that are recognized in interest income using the interest method
over the period to maturity.
- Trading - Debt and equity securities that are bought and held
principally for the purpose of selling them in the near term are classified
as trading account securities and reported at their fair values.
Unrealized gains and losses on trading account securities are included
immediately in income.
- Available for sale - Debt and equity securities not classified
as either held to maturity securities or trading account securities are
classified as available for sale securities and recorded at fair value,
with unrealized gains and losses excluded from income and reported in a
separate component of equity until realized. Gains and losses on the sale
of available for sale securities are determined using the specific
identification method. Premiums and discounts are recognized in interest
income using the interest method over the period to maturity.
Prior to the adoption of SFAS 115, debt securities held for investment
were recorded at cost, adjusted for amortization of premiums and accretion
of discounts using the interest method. Gains and losses arising from the
sale of investment securities (specific identification basis) were
recognized upon realization. Unrealized gains or losses due to market
fluctuations were not recognized unless, in the opinion of management, a
permanent impairment of value had occurred.
INTEREST ON LOANS:
Unearned interest on installment loans made prior to October, 1991 is
credited to operations over the life of the loans, using the sum-of-the-
months-digits method. For all other loans, interest is accrued daily on
the outstanding balances. Accrual of interest is discontinued on a loan
when management believes, after considering collection efforts and other
factors, that the borrower's financial condition is such that collection of
interest is doubtful.
-26-
LOAN ORIGINATION FEES AND COSTS:
Loan origination fees and certain direct origination costs are
capitalized and recognized as an adjustment of the yield on the related
loan.
ALLOWANCE FOR LOAN LOSSES:
The allowance for loan losses is generated by direct charges against
income and is available to absorb loan losses. The allowance is based upon
management's periodic evaluation of changes in the overall credit
worthiness of the loan portfolio, economic conditions in general, and the
effect of these conditions upon the financial status of specific borrowers
and other factors.
The Bank is subject to regulation by the Office of the Comptroller of
the Currency. They may require that the Bank adjust its allowance for loan
losses upon request.
OTHER REAL ESTATE OWNED:
Other real estate owned is carried at the lower of cost or estimated
fair value and consists of foreclosed real property, in-substance
foreclosed property, and other property held for sale. In-substance
foreclosed property is property where the borrower has little or no
remaining equity in the property, where repayment can only be expected to
come from the operation or sale of the property, and when the borrower has
effectively abandoned control of the property or it is doubtful that the
borrower will be able to rebuild equity in the property. The estimated
fair value is reviewed periodically by management and any write-downs are
charged against current earnings.
PREMISES AND EQUIPMENT:
Premises and equipment are stated at cost less accumulated
depreciation and amortization. Depreciation and amortization are
calculated on both straight-line and accelerated methods and are charged to
expense over the estimated useful lives of the related assets. Cost of
maintenance and repairs are charged to expense as incurred and improvements
are capitalized.
INCOME TAXES:
Income taxes are provided based upon income reported in the statements
of income (after exclusion of non-taxable income such as interest on state
and municipal securities). The income tax effect resulting from timing
differences between financial statement pre-tax income and taxable income
is deferred to future periods.
PENSION PLAN:
The Bank has a non-contributory defined benefit pension plan covering
substantially all of its employees. Benefits are based on years of service
and average earnings during the highest average sixty-month period during
the final one hundred and twenty months of employment.
The Bank's policy is to fund the maximum amount of contributions
allowed for tax purposes. The Bank does accrue an amount equal to its
actuarially computed obligation under the plan.
The net periodic pension expense includes a service cost component,
interest on the projected benefit obligation, return on plan assets and the
effect of deferring and amortizing certain actuarial gains and losses and
the unrecognized net transition asset over fifteen years.
TRUST ASSETS AND INCOME:
Assets held by the Trust Department are not included in the financial
statements, since such items are not assets of the Bank. In accordance
with industry practice, trust service income is recognized primarily on the
cash basis. Reporting such income on the accrual basis would not
materially effect net income.
-27-
STOCK SPLIT:
On May 14, 1993, the Board of Directors authorized a two for one stock
split effected in the form of a 100 percent stock dividend. All earnings
per share amounts and share amounts included in the financial statements
have been adjusted for the stock split. An amount equal to the $5 par
value of the additional common shares has been transferred from retained
earnings to common stock. In addition, a transfer has been made from
retained earnings to capital surplus for an equal amount.
RECLASSIFICATIONS:
Certain amounts in the financial statements have been reclassified to
conform with classifications adopted in the current year.
NOTE 2. INVESTMENT SECURITIES
_____________________________
At December 31, 1994, the investment securities portfolio is composed of
securities classified as held to maturity and available for sale, in
conjunction with the adoption of SFAS 115. Investment securities held to
maturity are carried at cost, adjusted for amortization of premiums and
accretions of discounts, and investment securities available for sale are
carried at market value. SFAS 115 does not allow retroactive restatement,
accordingly, the investment securities portfolio at December 31, 1993 and
1992, are carried at cost, adjusted for amortization of premiums and
accretion of discounts.
____________________________________________________________________________________________________________
THE AMORTIZED COST AND FAIR VALUE OF INVESTMENT SECURITIES HELD TO MATURITY
December 31, 1994
Carrying Unrealized Unrealized Market
(Dollars in Thousands) Value Gains Losses Value
____________________________________________________________________________________________________________
Obligations of States and
political subdivisions $919 $5 $(6) $918
=== = = ===
THE AMORTIZED COST AND FAIR VALUES OF INVESTMENT SECURITIES AVAILABLE FOR SALE
December 31, 1994
Amortized Unrealized Unrealized Market
(Dollars in Thousands) Cost Gains Losses Value
____________________________________________________________________________________________________________
United States Treasury securities $69,385 $ 18 $(2,751) $66,652
Obligations of other United States
Government agencies 4,999 17 (140) 4,876
Obligations of states and
political subdivisions 5,817 170 (5) 5,982
Other marketable equity securities,
at lower of cost or market 4,400 --- (223) 4,177
Federal Reserve Bank stock 85 --- --- 85
Federal Home Loan Bank stock 827 --- --- 827
______ ___ _____ ______
Total $85,513 $205 $(3,119) $82,599
====== === ===== ======
-28-
The amortized cost and fair value of investment securities
December 31, 1993
Carrying Unrealized Unrealized Market
(Dollars in Thousands) Amount Gains Losses Value
____________________________________________________________________________________________________________
United States Treasury securities $83,898 $2,325 $(178) $86,045
Obligations of other United States
Government agencies 5,003 422 --- 5,425
Obligations of states and
political subdivisions 6,738 494 --- 7,232
Other marketable equity securities,
at lower of cost or market 3,620 --- --- 3,620
Federal Reserve Bank stock 85 --- --- 85
______ _____ ___ _______
Total $99,344 $3,241 $(178) $102,407
====== ===== === =======
December 31, 1992
Carrying Unrealized Unrealized Market
(Dollars in Thousands) Amount Gains Losses Value
____________________________________________________________________________________________________________
United States Treasury securities $57,455 $1,792 $(21) $ 59,226
Obligations of other United States
Government agencies 6,170 424 --- 6,594
Obligations of states and
political subdivisions 9,766 422 (4) 10,184
Other marketable equity securities,
at lower of cost ($3,775) or market 3,764 --- --- 3,764
Federal Reserve Bank stock 85 --- --- 85
______ _____ __ _______
Total $77,240 $2,638 $(25) $79,853
====== ===== == =======
Investment securities carried at $29.1 million, $30.4 million, and $27.1
million, at December 31, 1994, 1993, and 1992, respectively, were pledged
to secure public deposits and securities sold under agreements to
repurchase and for other purposes required or permitted by law.
The amortized cost and approximate market values of investment securities
at December 31, 1994 by contractual maturity are shown below. Expected
maturities will differ from contractual maturities because borrowers may
have the right to call or prepay obligations with or without call or
prepayment penalties.
-29-
___________________________________________________________________________
December 31, 1994
Amortized Market
Cost Value
(Dollars in Thousands)
Due in one year or less $15,871 $15,782
Due after one year through five years 57,916 55,307
Due after five years through ten years 5,761 5,716
Due after ten years 1,472 1,522
______ ______
Total debt securities 81,020 78,327
Other securities without stated maturity 5,412 5,190
______ ______
Total investment securities $86,432 $83,517
The proceeds from the sales and maturities of investment securities and
securities available for sale, and the related realized gains and losses
are shown below:
_________________________________________________________________________________________________________________
1994 1993 1992
(Dollars in Thousands)
Proceeds from sales and maturities of investments
(including securities available for sale) $20,910 $14,502 $31,259
====== ====== ======
Realized gains $411 $19 $578
Realized losses (4) --- (115)
___ __ ___
Net gains $407 $19 $463
=== == ===
NOTE 3. LOANS
_____________
At December 31, loans before allowance for loan losses consisted of:
_________________________________________________________________________________________________________________
1994 1993 1992
(Dollars in Thousands)
Commercial and other $ 17,806 $16,836 $ 17,043
Real estate - construction 1,991 2,353 2,420
Real estate - mortgage 105,703 96,185 105,424
Installment loans to individuals 43,553 29,707 31,068
Tax exempt loans 4,754 5,585 6,987
_______ _______ _______
Subtotal 173,807 150,666 162,942
Less unearned income 66 384 1,428
_______ _______ _______
Total $173,741 $150,282 $161,514
======= ======= =======
Most of the Bank's lending activity is with customers located within
Virginia.
-30-
Information concerning loans which are contractually past due or in non-
accrual status is as follows:
_________________________________________________________________________________________________________________
1994 1993 1992
(Dollars In Thousands)
Contractually past due loans - past due 90 days
or more and still accruing interest $837 $458 $2,239
=== === =====
Loans which are in non-accrual status $2,955 $5,328 $4,670
=== === =====
The Bank has had, and may be expected to have in the future, banking
transactions in the ordinary course of business with directors, executive
officers, their immediate families, and companies in which they are
principal owners (commonly referred to as related parties), on the same
terms, including interest rates and collateral, as those prevailing at the
time for comparable transactions with others. The aggregate direct and
indirect loans of these persons totaled $1.5 million, $254 thousand, and
$2.5 million at December 31, 1994, 1993 and 1992, respectively. These
totals do not include loans made in the ordinary course of business to
other companies where a director or executive officer of the Bank was also
a director or officer of such company but not a principal owner. None of
the directors or executive officers had direct or indirect loans exceeding
10% of stockholders' equity at December 31, 1994.
NOTE 4. ALLOWANCE FOR LOAN LOSSES
_________________________________
Changes in the allowance for loan losses are as follows:
_________________________________________________________________________________________________________________
1994 1993 1992
(Dollars in Thousands)
Balance, beginning of year $2,692 $3,719 $3,233
Recoveries 541 310 235
Provision for loan losses 25 250 2,300
Loans charged off (611) (1,587) (2,049)
_____ _____ _____
Balance, end of year $2,647 $2,692 $3,719
===== ===== =====
NOTE 5. PREMISES AND EQUIPMENT
______________________________
At December 31, premises and equipment consisted of:
_________________________________________________________________________________________________________________
1994 1993 1992
(Dollars in Thousands)
Land $ 1,995 $ 1,995 $ 1,968
Buildings 5,727 5,701 5,460
Leasehold improvements 885 886 885
Furniture, fixtures and equipment 6,767 6,614 5,849
Total cost 15,374 15,196 14,162
Less accumulated depreciation and amortization 7,941 7,057 6,181
______ ______ ______
Net book value $ 7,433 $ 8,139 $ 7,981
====== ====== ======
-31-
NOTE 6. OTHER REAL ESTATE OWNED
_______________________________
Other real estate owned consisted of the following at December 31:
_________________________________________________________________________________________________________________
1994 1993 1992
(Dollars in Thousands)
Foreclosed real estate $214 $430 $ 453
In-substance foreclosed real estate --- --- 2,642
Property held for sale --- 435 500
___ ___ _____
Total $214 $865 $3,595
=== === =====
NOTE 7. INDEBTEDNESS
____________________
The Bank's short-term borrowings include federal funds purchased,
securities sold under repurchase agreements and United States Treasury
demand Notes. The federal funds purchased and securities sold under
repurchase agreements are held under various maturities and interest rates.
The United States Treasury Demand Notes are subject to call by the United
States Treasury with interest paid monthly at the rate of 25 basis points
(1/4%) below federal funds rate.
NOTE 8. STOCK OPTION PLAN
_________________________
The Company has stock option plans with 75,220 shares of common stock
reserved for options to key employees. Option prices are the fair market
value of the common stock on the date the options were granted.
Details of the number of shares and average prices are as follows:
_________________________________________________________________________________________________________________
1994 1993 1992
Under option, beginning of year 33,560 51,508 63,600
Granted 20,285 5,000 5,000
Exercised (8,340) (22,948) (15,592)
Expired --- --- (1,500)
______ ______ ______
Under option, end of year 45,505 33,560 51,508
====== ====== ======
Available to grant, end of year 29,715 50,000 55,000
====== ====== ======
Average Prices
Granted during the year $36.25 $25.00 $25.00
Exercised during the year $18.76 $17.01 $12.35
Under option, end of year $28.19 $20.97 $18.82
NOTE 9. INCOME TAXES
____________________
The components of income tax expense are as follows:
_________________________________________________________________________________________________________________
1994 1993 1992
(Dollars in Thousands)
Currently payable $1,039 $327 $653
Deferred 97 340 (277)
_____ ___ ___
Reported tax expense $1,136 $667 $376
===== === ===
-32-
The items that caused timing differences affecting deferred income taxes
are as follows:
_________________________________________________________________________________________________________________
1994 1993 1992
(Dollars in Thousands)
Provision for loan losses $51 $384 $(162)
Other writedowns and adjustments 86 12 (71)
Pension plan expenses 30 18 (20)
Deferred loan fees, net (12) 22 19
Security gains and losses (2) (5) (11)
Interest on certain non-accrual loans (124) (66) (52)
Alternative minimum taxes 51 (136) 2
Adoption of Statement on
Financial Accounting Standards No. 109 --- 99 ---
Other 17 12 18
___ ___ ___
$ 97 $340 $(277)
=== === ===
A reconciliation of the "expected" Federal income tax expense on income
before income taxes with the reported income tax expense follows:
_________________________________________________________________________________________________________________
1994 1993 1992
(Dollars in Thousands)
Expected tax expense (34%) $1,329 $980 $719
Interest expense on tax exempt assets 18 24 36
Tax exempt interest (240) (303) (392)
Alternative minimum tax 51 (85) 4
Disqualified incentive stock options (44) (50) 3
Adoption of Statement on
Financial Accounting Standards No. 109 --- 99 ---
Other, net 22 2 6
_____ ___ ___
Reported tax expense $1,136 $667 $376
===== === ===
NOTE 10. LEASE COMMITMENTS
__________________________
The Bank has noncancellable leases on premises and equipment expiring at
various dates, including extensions to the year 2011. Certain leases
provide for increased annual payments based on increases in real estate
taxes and the Consumer Price Index.
The total approximate minimum rental commitment at December 31, 1994, under
noncancellable leases is $630 which is due as follows:
Year (Dollars in Thousands)
1995 $144
1996 76
1997 78
1998 79
1999 80
Remaining term of leases 173
___
Total $630
===
The aggregate rental expense of premises and equipment was $178 thousand,
$140 thousand and $148 thousand for 1994, 1993 and 1992, respectively.
-33-
NOTE 11. PENSION PLAN
_____________________
The following table sets forth the Pension Plan's funded status and amounts
recognized in the Bank's financial statements at December 31:
_________________________________________________________________________________________________________________
1994 1993 1992
(Dollars in Thousands)
Actuarial present value of benefit obligations:
Vested benefits $ (1,556) $(1,181) $ (891)
===== ===== ===
Accumulated benefit obligation $ (1,605) $(1,247) $ (963)
===== ===== ===
Projected benefit obligation $(2,332) $(2,082) $(1,838)
Plan assets at fair value 2,058 1,857 1,686
_____ _____ _____
Projected benefit obligation in excess of plan assets (274) (225) (152)
Unrecognized net plan asset (88) (100) (113)
Net deferrals 153 27 (85)
_____ _____ _____
Pension plan liability included in
consolidated balance sheets (209) $ (298) $ (350)
===== ===== ===
Net pension cost includes the following components:
Service cost-benefits earned
in the current period $125 $114 $111
Interest cost on projected benefit obligations 153 145 128
Return on plan assets (131) (124) (123)
Recognition of unrecognized net plan asset (13) (12) (13)
Amortization of net deferrals 6 3 2
___ ___ ___
Net pension cost $140 $126 $105
=== === ===
The Bank made contributions to the Plan as follows:
(Dollars in Thousands)
1994 $229
1993 179
1992 48
The actuarial present value of benefits and obligations were
determined by use of the following assumptions:
Expected
Discount Compensation Long Term
Rate Increase Rate of Return
1994 7 1/2% 6 1/2% 7 1/2%
1993 8% 7% 8%
1992 8% 7% 8%
NOTE 12. PROFIT SHARING
_______________________
The Bank has a defined contribution profit sharing and thrift plan covering
substantially all of its employees. The Bank may make profit sharing
contributions to the plan as determined by the Board of Directors. In
addition, the Bank matches thrift contributions by employees fifty cents
for each dollar contributed. Expenses related to the plan totaled $196
thousand, $157 thousand, and $124 thousand in 1994, 1993 and 1992,
respectively.
NOTE 13. COMMITMENTS AND CONTINGENCIES
______________________________________
In the normal course of business, the Bank makes various commitments and
incurs certain contingent liabilities. These commitments and contingencies
represent off-balance sheet risk for the Bank. To meet the financing needs
of its customers, the Bank makes lending commitments under commercial lines
of credit, home equity loans and various construction and development
loans. The Bank also incurs contingent liabilities related to irrevocable
letters of credit.
-34-
At December 31, 1994, the Bank had the following off-balance sheet items:
Commitments to extend credit: (Dollars in Thousands)
Home equity lines of credit $8,937
Construction and development loans
committed but not funded 6,694
Other lines of credit
(principally commercial) 9,815
______
$25,446
======
Irrevocable letters of credit $ 1,475
======
Commitments to extend credit are agreements to lend to a customer as long
as there is no violation of any condition established in the contract.
Commitments generally have fixed expiration dates or other termination
clauses and may require payment of a fee. Since many of the commitments
are expected to expire without being drawn upon, the total commitment
amounts do not necessarily represent future cash requirements. The Bank
evaluates each customer's credit worthiness on a case-by-case basis. The
amount of collateral obtained, if deemed necessary by the Bank, upon
extension of credit is based on management's credit evaluation of the
customer. Collateral held varies but may include accounts receivable,
inventory, property, plant and equipment, and income-producing commercial
properties.
Standby letters of credit and financial guarantees written are conditional
commitments issued by the Bank to guarantee the performance of a customer
to a third party. Those guarantees are primarily issued to support private
borrowing arrangements. Most guarantees extend for less than 2 years and
expire in decreasing amounts through 1996. The credit risk involved in
issuing letters of credit is essentially the same as that involved in
extending loans to customers. The Bank holds various collateral supporting
those commitments for which collateral is deemed necessary.
NOTE 14. FAIR VALUE OF FINANCIAL INSTRUMENTS
____________________________________________
The estimated fair value of the Bank's financial instruments at December
31, 1994 are as follows:
Carrying Fair
Amount Value
(Dollars in Thousands)
Cash and due from banks $ 8,941 $ 8,941
Federal funds sold 247 247
Investment securities 919 918
Investment securities available for sale 82,599 82,599
Loans, net of allowances for loan losses 171,094 165,575
Deposits:
Non-interest bearing deposits 37,086 37,086
Savings deposits 96,986 96,986
Certificates of Deposit 101,527 100,740
Securities sold under repurchase agreement 13,694 13,694
Interest bearing U.S. Treasury demand notes
and other liabilities for borrowed money 1,162 1,162
Commitments to extend credit 25,446 25,446
Irrevocable letters of credit 1,475 1,475
-35-
The above presentation of fair values are required by Statement on
Financial Accounting Standards No. 107 "Disclosures about Market Values of
Financial Instruments". The fair values shown do not necessarily represent
the amounts which would be received on sale or other disposition of the
instruments.
The carrying amounts of cash and due from banks, federal funds sold, demand
and savings deposit and securities sold under repurchase agreements
represent items which do not present significant market risks, are payable
on demand or are of such short duration that market value approximates
carrying value.
Investment securities are valued at the quoted market price for the
individual securities held.
The fair value of loans is estimated by discounting future cash flows using
the current rates at which similar loans would be made to borrowers.
Time deposits are presented at estimated fair value using rates currently
offered for deposits of similar remaining maturities.
NOTE 15. REGULATORY MATTERS
The Company is required to maintain minimum amounts of capital to total
"risk weighted" assets, as defined by the banking regulators. At December
31, 1994, the Company is required to have minimum Tier 1 and Total Capital
ratios of 4.00% and 8.00% respectively. The Company's actual ratios at
that date were 17.57% and 16.32%, respectively. The Company's leverage
ratio at December 31, 1994, was 10.00%.
-36-
The following are the summarized financial statements of the Company.
_________________________________________________________________________________________________
OLD POINT FINANCIAL CORPORATION
PARENT ONLY
BALANCE SHEETS
As of December 31,
Dollars in thousands 1994 1993 1992
_________________________________________________________________________________________________
ASSETS
Cash in bank $ 154 $ 132 $ 27
Investment securities 1,438 646 774
Total Loans 54 56 ---
Investment in subsidiary 24,507 24,425 22,763
Other real estate owned --- 435 750
Other assets 68 142 71
______ ______ ______
TOTAL ASSETS $26,221 $25,836 $24,385
====== ====== ======
LIABILITIES AND
STOCKHOLDERS EQUITY
Notes payable - bank $ --- $ --- $ 180
Other liabilities --- --- 12
______ ______ ______
Total liabilities --- --- 192
Stockholders' equity 26,221 25,836 24,193
______ ______ ______
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $26,221 $25,836 $24,385
====== ====== ======
_________________________________________________________________________________________________
_________________________________________________________________________________________________
OLD POINT FINANCIAL CORPORATION
PARENT ONLY
INCOME STATEMENTS
For the year ended December 31, 1994 1993 1992
Dollars in thousands
_________________________________________________________________________________________________
INCOME
Cash dividends from subsidiary $ 950 $ 675 $ ---
Interest and Fees on Loans 5 1 ---
Interest income from
investment securities 63 32 77
Other income --- 27 40
_____ ___ ___
TOTAL INCOME 1,018 735 117
EXPENSES
Interest on borrowed money --- 9 13
Other expenses 244 258 279
_____ ___ ___
TOTAL EXPENSES 244 267 292
Income before taxes and undistributed
net income of subsidiary 774 468 (175)
Income tax (60) (70) (59)
_____ ___ ___
Net income before undistributed
net income of subsidiary 834 538 (116)
Undistributed net income of subsidiary 1,939 1,677 1,854
_____ ___ ___
NET INCOME $2,773 2,215 $1,738
===== ===== =====
_________________________________________________________________________________________________
-37-
_________________________________________________________________________________________________
OLD POINT FINANCIAL CORPORATION
PARENT ONLY
STATEMENTS OF CASH FLOWS
For the year ending December 31,
Dollars in thousands 1994 1993 1992
_________________________________________________________________________________________________
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $2,773 $2,215 $1,738
Adjustment to reconcile net income to net cash
provided by operating activities:
Equity in undistributed (income)
losses of subsidiaries (1,939) (1,677) (1,854)
Market write-down on other real estate owned --- 65 209
Increase (decrease) in other assets 95 (71) (71)
Increase (decrease) in other liabilities --- (12) 12
_____ _____ _____
Net cash provided by operating activities 929 520 34
CASH FLOWS FROM INVESTING ACTIVITIES
(Purchase)/Sales of Investments (850) 125 450
Transfer of branch site to
other real estate owned --- --- ---
(Increase) decrease in other
real estate owned 435 250 ---
Loans to Customers 2 (56) ---
_____ _____ _____
Net cash (used in) investing activities (413) 319 450
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in borrowed money --- (180) (14)
Proceeds from issuance of common stock 200 70 28
Dividends paid (694) (624) (492)
_____ _____ _____
Net cash provided by financing activities (494) (734) (478)
Net increase in cash and due from banks 22 105 6
Cash and due from banks at beginning of period 132 27 21
_____ _____ _____
Cash and due from banks at end of period $ 154 $ 132 $ 27
===== ===== =====
_________________________________________________________________________________________________
Accounting Rule Changes
In February 1992, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 109, Accounting for
Income Taxes, which supersedes SFAS No. 96. SFAS No. 109 requires that an
asset and liability approach for accounting for income taxes be adopted for
fiscal years beginning after December 15, 1992. The objective of SFAS No.
109 is to establish deferred tax assets and liabilities for the temporary
differences between the financial reporting basis and the tax basis of the
Company's assets and liabilities at enacted tax rates expected to be in
effect when such amounts are realized or settled. As a result, the Company
adopted SFAS No. 109 in 1993, and changed from the deferred method of
accounting for income taxes. The effect of this change on 1993 earnings
was a reduction in income of $98 thousand, or $0.08 per share.
-38-
The Financial Accounting Standards Board (FASB) issued Statement of
Financial Accounting Standards No. 114, Accounting by Creditors for
Impairment of a Loan, addressing the accounting for impaired loans. This
Standard also clarifies the existing accounting for in-substance
foreclosures. Under the new impairment standard and related amendments to
Statement No. 15, "Accounting by Debtors and Creditors for Troubled Debt
Restructurings," a collateral dependent real estate loan (i.e., a loan for
which repayment is expected to be provided solely by the underlying
collateral) would be reported as other real estate owned (OREO) only if the
lender had taken possession of the collateral. As a result of these
amendments, $1.51 million in real estate loans previously carried as in-
substance foreclosed and reported as other real estate owned have been
reclassified to their respective loan categories.
Effective January 1, 1994, the Company implemented Statement of Financial
Accounting Standards (SFAS) No. 115, Accounting for Certain Investments in
Debt and Equity Securities. This Standard requires the segregation of
investment securities at the time of purchase into three categories; held
to maturity, available for sale, or trading securities, and stipulates the
handling of realized and unrealized gains and losses on those securities as
well as treatment of transfers between categories. The Company elected to
classify its existing investment portfolio in available for sale with
unrealized gains and losses excluded from income and reported as a net
after tax amount in a separate component of stockholders' equity until
realized at which time any gains or losses are reported in current
earnings.
Regulatory Requirements and Restrictions
For the reserve maintenance period in effect at December 31, 1994, 1993 and
1992 the bank was required to maintain with the Federal Reserve Bank of
Richmond an average daily balance totalling approximately $4.9 million,
$4.6 million, and $4.3 million respectively.
Item 9. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure
None.
-39-
PART III
Item 10. Directors and Executive Officers of the Registrant
The eleven persons named below, all of whom currently serve as directors of
the Company will be nominated to serve as directors until the 1996 Annual
Meeting, or until their successors have been duly elected and have
qualified.
__________________________________________________________________________________________________
Amount and Nature of
Principal Beneficial Ownership
Director Occupation For As of March 14, 1995
Name and (Age) Since (1)<F6> Past Five Years (Percent of Class)
Dr. Richard F. Clark (62) 1981 Pathologist 30,589 (2)<F7>
Sentara Hampton General Hospital 2.4%
Gertrude S. Dixon (81) 1981 Real Estate Management 96,062 (2)<F7>
and Ownership 7.5%
Russell Smith Evans Jr. (52) 1993 Assistant Treasurer and 710*<F8> (2)<F7>
Corporate Fleet Manager
Ferguson Enterprises
G. Royden Goodson, III (39) 1994 President 2,200*<F8> (2)<F7>
Warwick Plumbing & Heating Corp.
Dr. Arthur D. Greene (50) 1994 Surgeon - Partner 200*<F8>
Tidewater Orthopaedic Associates
Stephen D. Harris (53) 1988 Attorney-at-Law - Partner 4,175*<F8>
Geddy, Harris & Geddy
John Cabot Ishon (48) 1989 President 6,290*<F8> (2)<F7>
Hampton Stationery
Eugene M. Jordan (71) 1964 Attorney-at-Law 13,890 (2)<F7>
Jordan, Ishon & Jordan, P.C. 1.1%
John B. Morgan, II (48) 1994 Vice President 1,200*<F8> (2)<F7>
Morgan-Marrow Insurance
John G. Sebrell (47) 1992 President & CEO (a) 10,670*<F8>(3)<F9>
The Old Point National
Bank of Phoebus
Robert F. Shuford (57) 1965 Chairman of the Board, 102,183 (2)<F7>
President & CEO
Old Point Financial Corporation 8.0%
__________________________________________________________________________________________________
<F8>
*Represents less than 1.0% of the total outstanding shares.
-40-
<F6>
(1) Refers to the year in which the individual first became a director of
the Bank. Dr. Richard F. Clark, Gertrude S. Dixon, Eugene M. Jordan, and
Robert F. Shuford became directors of the Company upon consummation of the
Bank's reorganization on October 1, 1984. Russell Smith Evans, Jr. was
elected April 27, 1993, G. Royden Goodson, III was elected on August 9,
1994, Dr. Arthur D. Greene was elected on August 9, 1994, John B. Morgan,
II was elected on October 11, 1994, Stephen D. Harris was elected October
11, 1988, John Cabot Ishon was elected March 27, 1990, and John G. Sebrell
was elected August 11, 1992. (a) Prior to his present employment, Mr.
Sebrell was Senior Vice President and Senior Credit Policy Officer at
NationsBank (formerly Sovran). All present directors of the Company are
directors of the Bank.
<F7>
(2) Includes shares held (i) by their close relatives or held jointly with
their spouses, (ii) as custodian or trustee for the benefit of their
children or others, or (iii) as attorney-in-fact subject to a general power
of attorney - Dr. Clark, 54 shares; Mrs. Dixon, 48,740 shares; Mr. Evans,
310 shares; Mr. Goodson, 1,900 shares; Mr. Ishon, 1,640 shares; Mr. Jordan,
8,485 shares; Mr. Morgan, 1,000 shares; and Mr. Shuford, 73,320 shares.
<F9>
(3) Includes shares that may be acquired within 60 days pursuant to the
exercise of stock options granted under the Old Point Stock Option Plans -
Mr. Sebrell 10,000.
There is one family relationship among the directors and executive
officers. Mr. Jordan is the father-in-law of Mr. Ishon. None of the
directors serves as a director of any other company with a class of
securities registered pursuant to Section 12 of the Securities Exchange Act
of 1934.
There were no delinquent Securities and Exchange Form 4 filings during
1994.
In addition to the 2 executive officers included in the preceding list of
directors, the persons listed below were executive officers of the Company
or its subsidiary as of December 31, 1994.
Executive Principal
Officer Occupation For
Name and (Age) Since (1) Past Five Years
______________________________________________________________________________
Louis G. Morris (40) 1988 Senior Vice President and Treasurer
Old Point Financial Corporation
Cary B. Epes (46) 1993 Senior Vice President
Old Point Financial Corporation
W. Rodney Rosser (54) 1989 Senior Vice President and Secretary
Old Point Financial Corporation
Margaret P. Causby (44) 1992 Senior Vice President
Old Point National Bank
Patricia A. Orendorff (48) 1994 Senior Vice President and Cashier
Old Point National Bank
______________________________________________________________________________
Each of these executive officers owns less than 1% of the stock of the
Company.
(1) Prior to employment with the Company, Cary B. Epes was Vice President
and Commercial Account Manager at Crestar Bank. All other executive
officers served in virtually the same capacity with the Company and/or the
Bank prior to appointment as an executive officer.
-41-
Item 11. Executive Compensation
Cash Compensation
The following table presents all compensation paid or accrued by the
Company and the Bank to the Company's Chief Executive Officer and each
executive officer whose salary and bonus for 1994 exceeds $100,000. Mr.
Robert F. Shuford is compensated by the Company and Mr. John G. Sebrell is
compensated by the Bank.
SUMMARY COMPENSATION TABLE
_______________________________________________________________________________________________
Annual Compensation
Other
Name Annual All Other
and Compen- Compen-
Principal Salary Bonus sation sation
Position Year ($) ($) ($) ($)
_______________________________________________________________________________________________
Robert F. Shuford 1994 $143,400 (a) $ 6,000 (b) $ 2,941 $42,610 (c)
Holding Company 1993 $138,100 (a) $ 4,000 $ 3,233 $65,655 (c)
Chairman, President 1992 $137,799 (a) $ 5,000 $ 2,757 $ 6,963 (c)
& CEO
John G. Sebrell 1994 $110,400 (a) $12,244 (b) $ 8,631 $ 5,682 (d)
Bank 1993 $105,100 (a) $ 8,000 $11,119 $ 0
President & CEO 1992 $ 81,295 (a) $ 5,000 $ 6,362 $ 0
_______________________________________________________________________________________________
(a) Salary includes directors' fees as follows: Mr. Shuford - 1994 of
$5,400, 1993 of $5,100 and 1992 of $4,800; Mr. Sebrell - 1994 of $5,400,
1993 of $5,100 and 1992 of $1,500.
(b) In 1994, bonus consideration for Mr. Shuford and Mr. Sebrell was
deferred until January 1995 so that year end results could be evaluated by
the Compensation Committee.
(c) Mr. Shuford has received other compensation as follows:
1994 1993 1992
Profit Sharing $ 3,001 $ 2,592 $1,770
401-K Matching Plan 4,149 3,990 3,990
Split Dollar Life Insurance 1,460 1,323 1,203
Sale of ISO * 34,000 57,750 0
______ ______ _____
$42,610 $65,655 $6,963
* When an incentive stock option (ISO) share is sold prior to a one
year vesting period, the gain on the sale is treated as compensation to the
employee.
(d) Mr. Sebrell has received other compensation as follows:
1994 1993 1992
Profit Sharing $ 2,285 $ 0 $ 0
401-K Matching Plan $ 3,159 $ 0 $ 0
Split Dollar Life Insurance $ 238 $ 0 $ 0
______ ______ _____
$ 5,682 $ 0 $ 0
Mr. Sebrell was ineligible for participation in the profit sharing
and 401-K Plan prior to 1994.
-42-
Item 12. Security Ownership of Certain Beneficial Owners and Management
Security ownership of certain beneficial owners and management is detailed
in Part III, Item 10. of this Annual Report on Form 10-K.
Item 13. Certain Relationships and Related Transactions
Some of the Company directors, executive officers, and members of their
immediate families, and corporations, partnerships and other entities of
which such persons are officers, directors, partners, trustees, executors
or beneficiaries, are customers of the Bank. As of December 31, 1994,
borrowing by all policy making officers and directors amounted to $1.48
million. This amount represented 5.6% of the total equity capital accounts
of the Company as of December 31, 1994. All loans and commitments to lend
included in such transactions were made in the ordinary course of business,
upon substantially the same terms, including interest rates and collateral,
as those prevailing at the time for comparable transactions with other
persons and did not involve more than normal risk of collectibility or
present other unfavorable features. It is the policy of the Bank to provide
loans to officers who are not executive officers and to employees at more
favorable rates than those prevailing at the time for comparable
transactions with other persons. These loans do not involve more than the
normal risk of collectibility or present other unfavorable features. The
Bank expects to have in the future similar banking transactions with
directors, officers, principal stockholders and their associates.
The law firm of Jordan, Ishon and Jordan, P.C. serves as legal counsel to
the Bank. Mr. Eugene M. Jordan is a member of the firm. During 1994, the
firm received from the Bank a retainer and fees totalling $40,435. The
firm also received additional fees for acting as trustee on foreclosures of
collateral held by the Bank totalling $13,605, however, these fees were
paid by the purchasers of the collateral and not the Bank. In addition,
Hampton Stationery, of which John Cabot Ishon is the owner, provided
furniture and supplies to the Bank in the amount of $50,889 during 1994.
Geddy, Harris & Geddy, of which Stephen D. Harris is a partner, also
provided legal services to the Bank during 1994.
-43-
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
A.1 Financial Statements:
The following audited financial statements are included in Part
II, Item 8, of this Annual Report on Form 10-K.
Consolidated Balance Sheets - December 31, 1994, 1993 and 1992
Consolidated Statements of Income
Years Ended December 31, 1994, 1993 and 1992
Consolidated Statements of Changes in Stockholders' Equity
Years Ended December 31, 1994, 1993 and 1992
Consolidated Statements of Cash Flows
Years Ended December 31, 1994, 1993 and 1992
Notes to Financial Statements
Auditor's Report
A.2 Financial Statement Schedules:
Schedule Location
Average Balance Sheets, Net Interest
Income and Rates Part I, Item 1
Analysis of Change in Net Interest Income Part I, Item 1
Interest Sensitivity Analysis Part I, Item 1
Investment Securities Part I, Item 1
Investment Security Maturities & Yields Part I, Item 1
Loans Part I, Item 1
Maturity Schedule of Selected Loans Part I, Item 1
Nonaccrual, Past Due and Restructured Loans Part I, Item 1
Analysis of the Allowance for Loan Losses Part I, Item 1
Allocation of the Allowance for Loan Losses Part I, Item 1
Deposits Part I, Item 1
Certificates of Deposit of $100,000 and more Part I, Item 1
Return on Average Equity Part I, Item 1
Short Term Borrowings Part I, Item 1
Lease Commitments Part I, Item 1
Other Real Estate Owned Part I, Item 1
Selected Financial Data Part II, Item 6
Capital Ratios Part II, Item 7
Dividends Paid and Market Price
of Common Stock Part II, Item 7
Proceeds from sales and maturities
of securities Part II, Item 8
Premises and Equipment Part II, Item 8
Stock Option Plan Part II, Item 8
Components of Income Tax Expense Part II, Item 8
Reconciliation of Expected and
Reported Income Tax Expense Part II, Item 8
Pension Plan Part II, Item 8
Commitments and Contingencies Part II, Item 8
Fair Value of Financial Instruments Part II, Item 8
Directors and Executive Officer Part III, Item 10
Executive Compensation Part III, Item 11
-44-
A.3 Exhibits:
3 Articles of Incorporation and Bylaws are incorporated
herein by reference to Registration Statement
(Form S-14) No. 2-89581.
4 Not Applicable
9 Not Applicable
10 Not Applicable
11 Not Applicable
12 Not Applicable
13 Not Applicable
18 Not Applicable
19 Not Applicable
22 Subsidiaries of the Registrant
23 Not Applicable
24 Consent of Independent Certified Public Accountants
25 Powers of Attorney
27 Financial Data Schedule
28 Not Applicable
29 Not Applicable
B. Reports on Form 8-K:
No Reports on Form 8-K were filed during the fourth quarter of 1994.
-45-
Signatures
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized on the
27th day of March, 1995.
OLD POINT FINANCIAL CORPORATION
/s/Robert F. Shuford
Robert F. Shuford, President
Pursuant to the requirements of the Securities and Exchange Act of
1934, this report has been signed by the following persons on behalf of the
registrant and in their capacities on the 25th day of March, 1995.
Signature Title
/s/Robert F. Shuford President and Director
Robert F. Shuford Principal Executive Officer
/s/Louis G. Morris Senior Vice President and Treasurer
Louis G. Morris Principal Financial & Accounting Officer
/s/Richard F. Clark *
Richard F. Clark Director
/s/Gertrude S. Dixon *
Gertrude S. Dixon Director
/s/Russell S. Evans, Jr. *
Russell S. Evans, Jr. Director
/s/G. Royden Goodson, III
Royden Goodson, III Director
/s/Dr. Arthur D. Greene
Dr. Arthur D. Greene Director
/s/Steven D. Harris *
Steven D. Harris Director
/s/John Cabot Ishon *
John Cabot Ishon Director
/s/Eugene M. Jordan *
Eugene M. Jordan Director
/s/John B. Morgan *
John B. Morgan Director
/s/John G. Sebrell *
John G. Sebrell Executive Vice President and Director
-46-
As filed with the Securities and Exchange Commission on March 27, 1995
Commission File No. 0-12896
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
ANNUAL REPORT
For the fiscal year ended December 31, 1994
OLD POINT FINANCIAL CORPORATION
EXHIBITS
-47-
INDEX OF EXHIBITS
Exhibit No.
3 Articles of Incorporation and Bylaws are
incorporated herein by reference to
Registration Statement (Form S-14) No. 2-89581.
4 Not Applicable
9 Not Applicable
10 Not Applicable
11 Not Applicable
12 Not Applicable
13 Not Applicable
18 Not Applicable
19 Not Applicable
22 Subsidiaries of the Registrant 49
23 Not Applicable
24 Consent of Independent Certified
Public Accountants 50
25 Powers of Attorney 51
27 Financial Data Schedule 62
28 Not Applicable
29 Not Applicable
-48-