Exhibit 99.1
PRESS RELEASE
Company: National Bancshares Corporation
OTC Bulletin Board - NBOH
Contact: Mark R. Witmer, President and CEO
Address: 112 West Market Street
Orrville, Ohio 44667
Phone: 330.682.1010
Fax: 330.682.4644
For Immediate Release: August 7, 2012
National Bancshares Corporation Announces Second Quarter Earnings
Orrville, Ohio ~ National Bancshares Corporation, the holding company for
First National Bank, reported net income of $317,000 for the quarter ended
June 30, 2012, a decrease from $589,000 for the same period in 2011.
Earnings per share were $0.14 and $0.27 for June 30, 2012 and 2011,
respectively.
Second Quarter 2012 Business Highlights:
~ Net interest income for the quarter ended June 30, 2012 was $3,483,000,
an increase of $113,000 or 3.4% compared to $3,370,000 in the same period
in 2011.
~ Noninterest expense decreased 5.7% to $2,967,000.
~ Loans, net of allowance for loan losses increased $26.0 million or 12.1%
from $213.9 million as of December 31, 2011 to $239.9 million as of
June 30, 2012.
~ Total deposits increased $30 million or 8.8% from $340.7 million as of
December 31, 2011 to $370.7 million as of June 30, 2012.
Year-to-Date 2012 Highlights:
Net income for the first half of 2012 decreased 5.5% to $1,017,000 from
$1,076,000 for the same period in 2011. Net income was positively impacted
by an increase in net interest income and a decrease in noninterest expense
and negatively impacted by an increase in the provision for loan losses.
Noninterest income for the first half increased $6,000 or 0.4%, to
$1,359,000 from $1,353,000 in the same period in 2011. Noninterest income
in 2011 included $128 thousand of gains recorded on the sale of the
guaranteed portion of five Small Business Administration (SBA) loans.
Mortgage banking income increased $127,000 for the six month period
ended June 30, 2012 compared to the same period in 2011, based on more
favorable loan sale activity.
1
Noninterest expense for the first half of 2012 was $6,013,000, a decrease
of 4.5% from $6,294,000 for the same period in 2011. The change was due
primarily to a decrease in professional and consulting expense and the
FDIC assessment expense.
June 30, 2012 Financial Condition:
Total assets increased 7.4% to $436.2 million as of June 30, 2012, from
$406.1 million at December 31, 2011. Securities available for sale totaled
$138.0 million compared to $150.2 million at December 31, 2011. Loans, net
of allowance for loan losses increased $26.0 million to $239.9 million
compared to $213.9 million at December 31, 2011. Deposits increased 8.8%
to $370.7 million compared to $340.7 million at December 31, 2011.
Shareholders` equity increased 2.3% to $43.7 million from $42.7 million
at the end of 2011. Accumulated other comprehensive income, which is the
unrealized gain on securities classified as available for sale, net of
tax, increased to $3.9 million compared to $3.6 million as of
December 31, 2011.
The allowance for loan losses increased from $3,163,000 as of
December 31, 2011 to $3,480,000 at June 30, 2012. Allowance for loan
losses as a percentage of total loans decreased from 1.46% at year-end 2011
to 1.43% at June 30, 2012, due to decreases in the collateral valuations
based on information obtained in the second quarter of 2012 for two
commercial real estate loan relationships.
The provision for loan losses for the quarter ended June 30, 2012 was
$981,000, compared to $150,000 for the same period in 2011. The increase
in the provision for loan losses is primarily related to changes in the
collateral valuations of two commercial real estate loan relationships
in June 2012. Both of the relationships have been classified as substandard
loans since December 31, 2010. A charge-off of $481 thousand was recorded
for one of these relationships, while the specific allocation on the other
loan was increased by $116 thousand.
Total nonperforming loans decreased from $4.0 million as of
December 31, 2011 to $2.6 million at June 30, 2012. Non-performing loans
consist of loans placed on non-accrual status and loans past due 90 or more
days and still accruing interest. Loans past due 30 through 89 days and
still accruing, increased from $641 thousand to $1.1 million as of
June 30, 2012. Adversely classified loans, including special mention,
substandard and doubtful, decreased from $12.1 million at December 31, 2011
to $10.7 million at June 30, 2012. Management believes the allowance for
loan losses is adequate as of June 30, 2012.
National Bancshares Corporation`s subsidiary, First National Bank, is
headquartered in Orrville, Ohio with fourteen banking offices in Orrville,
Massillon, Wooster, Apple Creek, Dalton, Fairlawn, Kidron, Lodi, Mt. Eaton,
Seville and Smithville.
Forward-Looking Statements ~ This press release contains forward-looking
statements as referenced in the Private Securities Litigation Reform Act
of 1995. Forward-looking statements are subject to many risks and
uncertainties. Actual results could differ materially from those indicated
by the forward-looking statements. These include factors such as changes
in the regulatory environment, changes in business conditions and
inflation, risks associated with credit quality and other factors discussed
in the Company`s filings with the U.S. Securities and Exchange Commission,
including its Annual Report on Form 10-K for the year ended
December 31, 2011. The Company assumes no obligation to update any
forward-looking statement.
2
Selected Consolidated Financial Data (Unaudited)
Balance Sheet Data:
(dollars in thousands)
Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,
2012 2012 2011 2011 2011
Cash and cash equivalents $ 31,937 $ 23,125 $ 15,213 $ 29,071 $ 31,694
Securities available for sale 131,957 145,930 150,175 144,008 135,926
Loans, net 239,924 222,346 213,952 207,096 203,255
Deposits 370,743 352,408 340,664 340,319 336,528
Repurchase agreements 9,417 9,816 10,168 10,071 8,782
Federal Home Loan Bank advances 8,000 8,000 8,000 9,000 9,000
Shareholders' equity 43,740 43,156 42,745 42,215 40,707
Total assets 436,154 417,731 406,086 407,059 398,787
Income Statement Data:
(dollars in thousands, except per
share data) Six months ended
Jun 30, Jun 30,
2012 2011 Change
Interest income $ 7,784 $ 7,567 2.9 %
Interest expense 904 1,100 (17.8)%
Net interest income 6,880 6,467 6.4 %
Provision for loan losses 1,130 297 280.5 %
Net interest income after provision for
loan losses 5,750 6,170 (6.8)%
Noninterest income 1,359 1,353 0.4 %
Noninterest expense:
Salaries and employee benefits 2,951 2,949 0.1 %
Data processing 585 569 2.8 %
Net occupancy 702 745 (5.8)%
Professional and consulting fees 196 326 (39.9)%
FDIC assessment 149 230 (35.2)%
Other 1,430 1,475 (3.1)%
Total noninterest expense 6,013 6,294 (4.5)%
Income before income taxes 1,096 1,229 (10.8)%
Income tax expense 79 153 (48.4)%
Net income $ 1,017 $ 1,076 (5.5)%
Earnings per share, basic and diluted $ 0.46 $ 0.49 (6.1)%
Weighted average shares outstanding, basic 2,216,562 2,209,717
Weighted average shares outstanding, diluted 2,219,510 2,209,717
Income Statement Data:
(dollars in thousands, except per
share data) Three months ended
Jun 30, Jun 30,
2012 2011 Change
Interest income $ 3,934 $ 3,892 1.1 %
Interest expense 451 522 (13.6)%
Net interest income 3,483 3,370 3.4 %
Provision for loan losses 981 150 554.0 %
Net interest income after provision for
loan losses 2,502 3,220 (22.3)%
Noninterest income 723 621 16.4 %
Noninterest expense:
Salaries and employee benefits 1,458 1,455 0.2 %
Data processing 290 286 1.4 %
Net occupancy 349 378 (7.7)%
Professional and consulting fees 99 176 (43.8)%
FDIC assessment 71 94 (24.5)%
Other 700 759 (7.8)%
Total noninterest expense 2,967 3,148 (5.7)%
Income before income taxes 258 693 (62.8)%
Income tax expense (benefit) (59) 104 nm
Net income $ 317 $ 589 (46.2)%
Earnings per share, basic and diluted $ 0.14 $ 0.27 (48.1)%
Weighted average shares outstanding, basic 2,216,599 2,209,717
Weighted average shares outstanding, diluted 2,219,393 2,209,717
nm - not meaningful
3
Quarterly Earnings Summary (Unaudited)
Previous Eight Quarters:
(dollars in thousands, except per
share data)
Jun Mar Dec Sep
2012 2012 2011 2011
Interest income $ 3,934 $ 3,850 $ 3,926 $ 3,920
Interest expense 451 453 469 481
Net interest income 3,483 3,397 3,457 3,439
Provision for loan losses 981 149 153 150
Net interest income after provision for
loan losses 2,502 3,248 3,304 3,289
Noninterest income 723 636 862 817
Noninterest expense 2,967 3,046 3,289 3,156
Income (loss) before income taxes 258 838 877 950
Income tax expense (benefit) (59) 138 103 188
Net income $ 317 $ 700 $ 774 $ 762
Earnings per share:
Basic and diluted $ 0.14 $ 0.32 $ 0.35 $ 0.34
Cash dividends per share $ 0.08 $ 0.08 $ 0.08 $ 0.08
Weighted average shares outstanding 2,216,562 2,216,526 2,213,269 2,213,269
Jun Mar Dec Sep
2011 2011 2010 2010
Interest income $ 3,892 $ 3,675 $ 3,704 $ 3,919
Interest expense 522 578 755 799
Net interest income 3,370 3,097 2,949 3,120
Provision for loan losses 150 147 879 228
Net interest income after provision for
loan losses 3,220 2,950 2,070 2,892
Noninterest income 621 732 744 1,209
Noninterest expense 3,148 3,146 2,969 2,947
Income (loss) before income taxes 693 536 (155) 1,154
Income tax expense (benefit) 104 49 (163) 288
Net income $ 589 $ 487 $ 8 $ 866
Earnings per share:
Basic and diluted $ 0.27 $ 0.22 $ 0.01 $ 0.39
Cash dividends per share $ 0.08 $ 0.08 $ 0.08 $ 0.08
Weighted average shares outstanding 2,209,717 2,209,717 2,205,973 2,205,973
4