8-K
NATIONAL BANKSHARES INC (NKSH)
UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
| Date of Report (Date of earliest event reported): January 22, 2026 |
|---|
National Bankshares Inc.
(Exact name of Registrant as Specified in Its Charter)
| Virginia | 0-15204 | 54-1375874 |
|---|---|---|
| (State or Other Jurisdiction<br>of Incorporation) | (Commission File Number) | (IRS Employer<br>Identification No.) |
| 101 Hubbard Street | ||
| Blacksburg, Virginia | 24060 | |
| (Address of Principal Executive Offices) | (Zip Code) | |
| Registrant’s Telephone Number, Including Area Code: 540 951-6300 | ||
| --- | ||
| Not applicable | ||
| --- |
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading<br>Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, par value $1.25 per share | NKSH | The Nasdaq Stock Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On January 22, 2026, National Bankshares, Inc. issued a press release reporting its financial results for the period ended December 31, 2025. A copy of the press release is being furnished as an exhibit to this report and is incorporated by reference into this Item 2.02.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
99.1 National Bankshares, Inc. Press Release, dated January 22, 2026
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| NATIONAL BANKSHARES, INC. | |||
|---|---|---|---|
| Date: | January 22, 2026 | By: | /s/ Lara E. Ramsey |
| Lara E. Ramsey<br>President and CEO |
EX-99.1
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
| CONTACTS: | Lara E. Ramsey, President and CEO | Lora M. Jones, Treasurer & CFO |
|---|---|---|
| (540) 951-6250 lramsey@nbbank.com | (540) 951-6238 ljones@nbbank.com |
National Bankshares, Inc. Reports Results for the Three and Twelve Months Ended December 31, 2025
BLACKSBURG, VA., January 22, 2026 -- National Bankshares, Inc. (“the Company”) (Nasdaq: NKSH), parent company of The National Bank of Blacksburg (“the Bank”) and National Bankshares Financial Services, Inc., today announced its results of operations through the fourth quarter of 2025. The Company reported net income of $15.83 million or $2.49 per diluted common share for the twelve months ended December 31, 2025. This compares with net income of $7.62 million or $1.24 per diluted common share for the twelve months ended December 31, 2024. For the three month period ended December 31, 2025, the Company reported net income of $5.88 million or $0.92 per diluted common share. This compares with net income for the three month period ended December 31, 2024 of $3.08 million or $0.48 per diluted common share. National Bankshares, Inc. ended December 31, 2025 with total assets of $1.82 billion.
Lara E. Ramsey, President and CEO, commented, "National Bankshares performed well in 2025, with net income up by $8.2 million over the previous year. Higher loan yields and lower deposit costs drove net interest margin improvement and delivered the vast majority of 2025’s net income gains.”
Ms. Ramsey continued, “In 2025, we successfully implemented key elements of our long-term strategy. Our core systems conversion is already delivering enhancements in customer experience and has empowered our ability to offer innovative new products and services. Our new branch facilities in Roanoke and Lynchburg open the door for expansion in markets with dynamic economies. In 2026 and beyond, we remain committed to growing value for our customers and our shareholders while elevating our brand as the bank of choice in the communities we serve."
Comparability
The Company acquired Frontier Community Bank ("FCB") on June 1, 2024. In accordance with generally accepted accounting principles, periods prior to June 1, 2024 have not been restated and do not include assets acquired, liabilities assumed or results of operations related to FCB prior to acquisition. On the date of merger, the transaction increased the Company's stockholders' equity by $14.3 million and added loans of $118.7 million, goodwill of $4.9 million, core deposit intangibles of $2.1 million, and customer deposits of $129.7 million. More information about assets acquired and liabilities assumed is provided in the Company's 2024 Form 10-K.
During the second quarter of 2025, the Company reclassified certain deposit products between savings deposits and time deposits, and made other minor reclassifications. Prior periods are presented on a comparable basis.
Highlights
Net Interest Income
The net interest margin improved when the fourth quarter of 2025 is compared with the third quarter of 2025 and when the twelve month periods ended December 31, 2025 and December 31, 2024 are compared, due to lower deposit costs and higher loan yields.
Noninterest Income
During the fourth quarter of 2025, other income increased due to dividends from certain equity method investments and higher insurance and investment commissions when compared with the third quarter of 2025. Noninterest income during the third quarter of 2025 reflected receipt of an incentive payment recorded in credit and debit card fees, a large estate fee included in trust income, and higher income from the Bank's secondary market mortgage operation. When comparing the
101 Hubbard Street / Blacksburg, Virginia 24060
P.O. Box 90002 / Blacksburg, Virginia 24062-9002
540 951-6300 / 800 552-4123
www.nationalbankshares.com
twelve month periods ended December 31, 2025 and 2024, incentive payments reflected in credit and debit card fees, higher insurance and securities commissions recorded in other income and growth in trust income drove the year-over-year increase.
Noninterest Expense
Noninterest expense increased when the fourth quarter of 2025 is compared with the third quarter of 2025 due to an increase in salaries and employee benefits, occupancy expense and data processing expense. When comparing the twelve month periods ended December 31, 2025 and 2024, higher noninterest expense is reflective of both the core system conversion and operations of the combined Company, which include the acquired operations of FCB. Noninterest expense in 2024 includes merger expenses related to the FCB acquisition.
Securities and Borrowings
During the fourth quarter of 2025, the Company invested $35 million in securities and fully repaid borrowings as of December 31, 2025. Analysis as of December 31, 2025 did not indicate credit risk concerns with any of the Company’s securities.
Deposits Deposits increased from the end of the third quarter to December 31, 2025. Company’s depositors within its market areas are diverse and include individuals, businesses and municipalities. The Company does not have any brokered deposits. Depositors are insured up to the FDIC maximum of $250 thousand. Municipal deposits, which account for 23.0% of the Company’s deposits, have additional security from bonds pledged as collateral, in accordance with state regulation. Of the Company’s non-municipal deposits, approximately 19.75% are uninsured.
Liquidity
The Company’s liquidity position remains solid. The Company maintains borrowing lines with the Federal Home Loan Bank of Atlanta (“FHLB”) and the Federal Reserve that provide substantial borrowing capacity. Combined with a low loan-to-deposit ratio, positive results of the latest liquidity stress testing and success of deposit marketing, the Company believes it is well positioned to meet foreseeable liquidity demands.
Loans and Credit Quality
Loans decreased from September 30, 2025, primarily driven by large payoffs in commercial real estate loans. The Company is positioned to continue to make every loan that meets its underwriting standards. Loan metrics continue to reflect low credit risk, with low charge-off and past due levels. The Company's measurement of credit risk resulted in a recovery to the allowance for credit losses on loans for the fourth quarter of 2025, reflecting an improvement in certain economic factors.
Stockholders’ Equity
The Company paid a semiannual dividend of $0.78 to shareholders on December 1, 2025, resulting in a total dividend for 2025 of $1.51 per share. Stockholders’ equity increased when December 31, 2025 is compared with September 30, 2025 due to net income and improvement in unrealized losses on available for sale securities, which are reflected, net of tax, in accumulated other comprehensive loss. Accumulated other comprehensive loss is excluded from the Bank’s regulatory capital and does not affect regulatory capital ratios. The Bank is considered well capitalized, with capital ratios substantially higher than minimum regulatory requirements, and meets all requirements for borrowing from the FHLB.
About National Bankshares
National Bankshares, Inc., headquartered in Blacksburg, Virginia, is the parent company of The National Bank of Blacksburg, which does business as National Bank, and of National Bankshares Financial Services, Inc. National Bank is a community bank operating from 28 full-service offices, primarily in southwestern, western and central Virginia, and one loan production office in Charlottesville, Virginia. National Bankshares Financial Services, Inc. is an investment and insurance subsidiary in the same trade area. The Company’s stock is traded on the Nasdaq Capital Market under the symbol “NKSH.” Additional information is available at www.nationalbankshares.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by use of words such as “may,” “will,” “anticipates,” “believes,” “expects,” “plans,” “estimates,” “potential,” “continue,” “should,” and similar words or phrases. These statements are based upon current and anticipated economic conditions, nationally and in the Company’s market, interest rates and interest rate policy, competitive factors, and other conditions which by their nature, are not susceptible to accurate forecast and are subject to significant uncertainty. Although we believe that our expectations with respect to forward-looking statements are based upon reasonable assumptions within the bounds of our existing knowledge of our business and operations, there can be no assurance that actual future results, performance, achievements, or trends will not differ materially from any projected future results, performance, achievements or trends expressed or implied by such forward-looking statements. Actual future results, performance, achievements or trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to, the following: the level of inflation; interest rates; national and local economic conditions; monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury, the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Consumer Financial Protection Bureau and the Federal Deposit Insurance Corporation, and the impact of any policies or programs implemented pursuant to financial reform legislation; unanticipated increases in the level of unemployment in the Company’s market; the quality or composition of the loan and/or investment portfolios; the sufficiency of the Company’s allowance for credit losses; demand for loan products; deposit flows, including impact on liquidity; competition; demand for financial services in the Company’s market; the real estate market conditions in the Company’s market; laws, regulations and policies impacting financial institutions; adverse developments in the financial industry generally, responsive measures to mitigate and manage such developments, related supervisory and regulatory actions and costs, and related impacts on customer behavior; technological risks and developments, and cyber-threats, attacks or events; the Company’s technology initiatives; geopolitical conditions, including acts or threats of terrorism and/or military conflicts, or actions taken by the U.S. or other governments in response to acts or threats of terrorism and/or military conflicts; the occurrence of significant natural disasters, including severe weather conditions, floods, and other catastrophic events; the Company's ability to identify, attract, and retain experienced management, relationship managers, and support personnel, particularly in a competitive labor environment; performance by the Company’s counterparties or vendors; applicable accounting principles, policies and guidelines; the impact of public health events, including the adverse impact on our business and operations and on our customers; and other factors described from time to time in the Company’s reports (such as our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K) filed with the Securities and Exchange Commission. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. The Company does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
National Bankshares, Inc.
Consolidated Balance Sheets
(Unaudited)
| (in thousands, except share and per share data) | December 31, | September 30, | December 31, | ||||||
|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2025 | 2024 | |||||||
| Assets | |||||||||
| Cash and due from banks | $ | 8,419 | $ | 9,192 | $ | 13,564 | |||
| Interest-bearing deposits | 50,831 | 33,113 | 94,254 | ||||||
| Federal funds sold | - | - | 299 | ||||||
| Total cash and cash equivalents | 59,250 | 42,305 | 108,117 | ||||||
| Securities available for sale, at fair value | 654,377 | 630,483 | 601,898 | ||||||
| Mortgage loans held for sale | - | 535 | 619 | ||||||
| Loans: | |||||||||
| Real estate construction loans | 40,694 | 46,381 | 50,798 | ||||||
| Consumer real estate loans | 328,653 | 324,597 | 307,855 | ||||||
| Commercial real estate loans | 467,783 | 490,968 | 478,078 | ||||||
| Commercial non real estate loans | 52,018 | 53,532 | 51,844 | ||||||
| Public sector and IDA loans | 63,677 | 54,332 | 57,171 | ||||||
| Consumer non real estate loans | 47,101 | 47,135 | 42,867 | ||||||
| Total loans | 999,926 | 1,016,945 | 988,613 | ||||||
| Less: deferred fees and costs | (616 | ) | (543 | ) | (663 | ) | |||
| Loans, net of deferred fees and costs | 999,310 | 1,016,402 | 987,950 | ||||||
| Less: allowance for credit losses on loans ("ACLL") | (9,892 | ) | (10,579 | ) | (10,262 | ) | |||
| Loans, net | 989,418 | 1,005,823 | 977,688 | ||||||
| Premises and equipment, net | 20,318 | 19,812 | 18,131 | ||||||
| Accrued interest receivable | 6,538 | 6,677 | 6,469 | ||||||
| Goodwill | 10,718 | 10,718 | 10,718 | ||||||
| Core deposit intangible, net | 1,490 | 1,579 | 1,863 | ||||||
| Bank-owned life insurance ("BOLI") | 48,568 | 48,262 | 47,369 | ||||||
| Other assets | 33,829 | 36,213 | 38,764 | ||||||
| Total assets | $ | 1,824,506 | $ | 1,802,407 | $ | 1,811,636 | |||
| Liabilities and Stockholders' Equity | |||||||||
| Noninterest-bearing demand deposits | $ | 313,022 | $ | 312,578 | $ | 290,088 | |||
| Interest-bearing demand deposits | 853,756 | 793,552 | 864,753 | ||||||
| Savings deposits | 142,645 | 140,635 | 143,109 | ||||||
| Time deposits | 317,510 | 315,139 | 346,802 | ||||||
| Total deposits | 1,626,933 | 1,561,904 | 1,644,752 | ||||||
| Borrowings | - | 50,000 | - | ||||||
| Accrued interest payable | 1,581 | 1,616 | 1,462 | ||||||
| Other liabilities | 11,084 | 9,667 | 9,013 | ||||||
| Total liabilities | 1,639,598 | 1,623,187 | 1,655,227 | ||||||
| Commitments and contingencies | |||||||||
| Stockholders' Equity | |||||||||
| Preferred stock, no par value, 5,000,000 shares authorized; none issued and outstanding | - | - | - | ||||||
| Common stock of $1.25 par value and additional paid in capital. Authorized 10,000,000 shares; issued and outstanding 6,368,410 (including 5,039 unvested) shares at December 31, 2025, 6,366,001 (including 5,028 unvested) shares at September 30, 2025, and 6,363,371 (including 4,961 unvested) shares at December 31, 2024 | $ | 22,024 | $ | 21,974 | $ | 21,831 | |||
| Retained earnings | 202,558 | 201,643 | 196,343 | ||||||
| Accumulated other comprehensive loss, net | (39,674 | ) | (44,397 | ) | (61,765 | ) | |||
| Total stockholders' equity | 184,908 | 179,220 | 156,409 | ||||||
| Total liabilities and stockholders' equity | $ | 1,824,506 | $ | 1,802,407 | $ | 1,811,636 |
National Bankshares, Inc.
Consolidated Statements of Income
(Unaudited)
| Three Months Ended | ||||||||
|---|---|---|---|---|---|---|---|---|
| (in thousands, except share and per share data) | December 31, | September 30, | December 31, | |||||
| 2025 | 2025 | 2024 | ||||||
| Interest Income | ||||||||
| Interest and fees on loans | $ | 14,765 | $ | 14,232 | $ | 13,149 | ||
| Interest on federal funds sold | - | - | 3 | |||||
| Interest on interest-bearing deposits | 426 | 740 | 758 | |||||
| Interest on securities – taxable | 4,042 | 3,704 | 4,038 | |||||
| Interest on securities – nontaxable | 336 | 334 | 335 | |||||
| Total interest income | 19,569 | 19,010 | 18,283 | |||||
| Interest Expense | ||||||||
| Interest on time deposits | 2,792 | 2,907 | 3,557 | |||||
| Interest on other deposits | 3,817 | 4,362 | 4,755 | |||||
| Interest on borrowings | 314 | 67 | - | |||||
| Total interest expense | 6,923 | 7,336 | 8,312 | |||||
| Net interest income | 12,646 | 11,674 | 9,971 | |||||
| (Recovery of) provision for credit losses | (634 | ) | 306 | (60 | ) | |||
| Net interest income after (recovery of) provision for credit losses | 13,280 | 11,368 | 10,031 | |||||
| Noninterest Income | ||||||||
| Service charges on deposit accounts | 690 | 681 | 709 | |||||
| Other service charges and fees | 82 | 72 | 85 | |||||
| Credit and debit card fees, net | 404 | 492 | 307 | |||||
| Trust income | 615 | 700 | 581 | |||||
| BOLI income | 306 | 304 | 298 | |||||
| Gain on sale of mortgage loans held for sale | 55 | 92 | 36 | |||||
| Other income | 474 | 196 | 260 | |||||
| Total noninterest income | 2,626 | 2,537 | 2,276 | |||||
| Noninterest Expense | ||||||||
| Salaries and employee benefits | 5,353 | 5,114 | 5,108 | |||||
| Occupancy, furniture and fixtures | 837 | 770 | 675 | |||||
| Data processing | 889 | 848 | 1,029 | |||||
| FDIC assessment | 204 | 210 | 222 | |||||
| Intangible asset amortization | 89 | 92 | 100 | |||||
| Franchise taxes | 350 | 350 | 373 | |||||
| Professional services | 277 | 361 | 285 | |||||
| Merger-related expenses | - | - | 25 | |||||
| Core system conversion expense | 3 | 50 | – | |||||
| Other operating expenses | 672 | 729 | 803 | |||||
| Total noninterest expense | 8,674 | 8,524 | 8,620 | |||||
| Income before income taxes | 7,232 | 5,381 | 3,687 | |||||
| Income tax expense | 1,351 | 961 | 608 | |||||
| Net Income | $ | 5,881 | $ | 4,420 | $ | 3,079 | ||
| Basic net income per common share | $ | 0.92 | $ | 0.70 | $ | 0.48 | ||
| Diluted net income per common share | $ | 0.92 | $ | 0.69 | $ | 0.48 | ||
| Weighted average number of common shares outstanding, basic | 6,361,494 | 6,360,973 | 6,356,949 | |||||
| Weighted average number of common shares outstanding, diluted | 6,364,638 | 6,363,351 | 6,359,506 | |||||
| Dividends declared per common share | $ | 0.78 | $ | - | $ | 0.78 | ||
| Book value per common share | $ | 29.04 | $ | 28.15 | $ | 24.58 |
National Bankshares, Inc.
Consolidated Statements of Income
(Unaudited)
| Year Ended December 31, | |||||
|---|---|---|---|---|---|
| (in thousands, except share and per share data) | 2025 | 2024 | |||
| Interest Income | |||||
| Interest and fees on loans | $ | 55,451 | $ | 47,912 | |
| Interest on federal funds sold | 5 | 26 | |||
| Interest on interest-bearing deposits | 3,183 | 4,070 | |||
| Interest on securities – taxable | 15,331 | 16,682 | |||
| Interest on securities – nontaxable | 1,343 | 1,345 | |||
| Total interest income | 75,313 | 70,035 | |||
| Interest Expense | |||||
| Interest on time deposits | 12,068 | 13,047 | |||
| Interest on other deposits | 17,303 | 20,675 | |||
| Interest on borrowings | 381 | 2 | |||
| Total interest expense | 29,752 | 33,724 | |||
| Net interest income | 45,561 | 36,311 | |||
| (Recovery of) provision for credit losses | (16 | ) | 1,227 | ||
| Net interest income after (recovery of) provision for credit losses | 45,577 | 35,084 | |||
| Noninterest Income | |||||
| Service charges on deposit accounts | 2,804 | 2,728 | |||
| Other service charges and fees | 310 | 371 | |||
| Credit and debit card fees, net | 1,679 | 1,448 | |||
| Trust income | 2,472 | 2,177 | |||
| BOLI income | 1,199 | 1,120 | |||
| Gain on sale of mortgage loans held for sale | 226 | 168 | |||
| Other income | 1,312 | 1,034 | |||
| Total noninterest income | 10,002 | 9,046 | |||
| Noninterest Expense | |||||
| Salaries and employee benefits | 20,858 | 19,214 | |||
| Occupancy, furniture and fixtures | 3,077 | 2,650 | |||
| Data processing | 3,421 | 3,558 | |||
| FDIC assessment | 831 | 812 | |||
| Intangible asset amortization | 373 | 237 | |||
| Franchise taxes | 1,431 | 1,454 | |||
| Professional services | 1,446 | 1,051 | |||
| Merger-related expense | - | 2,916 | |||
| Core system conversion expense | 2,076 | 173 | |||
| Other operating expenses | 2,900 | 2,943 | |||
| Total noninterest expense | 36,413 | 35,008 | |||
| Income before income tax expense | 19,166 | 9,122 | |||
| Income tax expense | 3,340 | 1,499 | |||
| Net Income | $ | 15,826 | $ | 7,623 | |
| Basic net income per common share | $ | 2.49 | $ | 1.24 | |
| Diluted net income per common share | $ | 2.49 | $ | 1.24 | |
| Weighted average number of common shares outstanding, basic | 6,359,960 | 6,161,428 | |||
| Weighted average number of common shares outstanding, diluted | 6,362,505 | 6,163,610 | |||
| Dividends declared per common share | $ | 1.51 | $ | 1.51 | |
| Book value per common share | $ | 29.04 | $ | 24.58 |
National Bankshares, Inc.
Net Interest Margin
(Unaudited)
| Three Months Ended December 31, 2025 | Three Months Ended September 30, 2025 | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| ($ in thousands) | Average<br>Balance | Interest | Average<br>Yield/Rate | Average<br>Balance | Interest | Average<br>Yield/Rate | ||||||||
| Interest-earning assets: | ||||||||||||||
| Loans (1)(2)(3)(4) | $ | 1,011,394 | $ | 14,922 | 5.85 | % | $ | 1,010,041 | $ | 14,356 | 5.64 | % | ||
| Taxable securities (4) | 624,957 | 4,042 | 2.57 | % | 588,212 | 3,704 | 2.50 | % | ||||||
| Nontaxable securities (1)(4) | 62,266 | 456 | 2.91 | % | 62,730 | 454 | 2.87 | % | ||||||
| Federal funds sold | - | - | - | - | - | - | ||||||||
| Interest-bearing deposits | 49,497 | 426 | 3.41 | % | 71,009 | 740 | 4.13 | % | ||||||
| Total interest-earning assets | $ | 1,748,114 | $ | 19,846 | 4.50 | % | $ | 1,731,992 | $ | 19,254 | 4.41 | % | ||
| Interest-bearing liabilities: | ||||||||||||||
| Interest-bearing demand deposits | $ | 818,156 | $ | 3,764 | 1.83 | % | $ | 827,977 | $ | 4,307 | 2.06 | % | ||
| Savings deposits | 141,577 | 53 | 0.15 | % | 141,197 | 55 | 0.15 | % | ||||||
| Time deposits(5) | 318,446 | 2,792 | 3.48 | % | 322,782 | 2,907 | 3.57 | % | ||||||
| Borrowings | 28,929 | 314 | 4.31 | % | 6,630 | 67 | 4.01 | % | ||||||
| Total interest-bearing liabilities | $ | 1,307,108 | $ | 6,923 | 2.10 | % | $ | 1,298,586 | $ | 7,336 | 2.24 | % | ||
| Net interest income and interest rate spread | $ | 12,923 | 2.40 | % | $ | 11,918 | 2.17 | % | ||||||
| Net interest margin | 2.93 | % | 2.73 | % | ||||||||||
| Three Months Ended December 31, 2024 | ||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | |||||||
| ($ in thousands) | Average<br>Balance | Interest | Average<br>Yield/Rate | |||||||||||
| Interest-earning assets: | ||||||||||||||
| Loans (1)(2)(3)(4) | $ | 995,259 | $ | 13,268 | 5.30 | % | ||||||||
| Taxable securities (4) | 619,575 | 4,038 | 2.59 | % | ||||||||||
| Nontaxable securities (1)(4) | 63,079 | 455 | 2.87 | % | ||||||||||
| Federal funds sold | 294 | 3 | 4.06 | % | ||||||||||
| Interest-bearing deposits | 63,028 | 758 | 4.78 | % | ||||||||||
| Total interest-earning assets | $ | 1,741,235 | $ | 18,522 | 4.23 | % | ||||||||
| Interest-bearing liabilities: | ||||||||||||||
| Interest-bearing demand deposits | $ | 836,486 | $ | 4,697 | 2.23 | % | ||||||||
| Savings deposits | 142,366 | 58 | 0.16 | % | ||||||||||
| Time deposits(5) | 343,653 | 3,557 | 4.12 | % | ||||||||||
| Total interest-bearing liabilities | $ | 1,322,505 | $ | 8,312 | 2.50 | % | ||||||||
| Net interest income and interest rate spread | $ | 10,210 | 1.73 | % | ||||||||||
| Net interest margin | 2.33 | % |
- Interest on nontaxable loans and securities is computed on a fully taxable equivalent basis using a federal income tax rate of 21%. See “Reconciliation of Non-GAAP Financial Measures” at the end of this release.
- Included in loan interest income are loan fees and net accretion of deferred fees and costs of $142, $162 and $71 for the three months ended December 31, 2025, September 30, 2025 and December 31, 2024, respectively. Also included is net accretion of acquisition discounts of $689, $700 and $322 for the three months ended December 31, 2025, September 30, 2025 and December 31, 2024, respectively.
- Includes loans held for sale and nonaccrual loans.
- Daily averages are shown at amortized cost.
- Included in time deposit interest expense is net amortization of acquisition premiums of $20, $28 and $85 for the three months ended December 31, 2025, September 30, 2025 and December 31, 2024, respectively.
| Year Ended December 31, | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2024 | |||||||||||||
| ($ in thousands) | Average<br>Balance | Interest | Average<br>Yield/Rate | Average<br>Balance | Interest | Average<br>Yield/Rate | ||||||||
| Interest-earning assets: | ||||||||||||||
| Loans (1)(2)(3)(4) | $ | 1,006,277 | $ | 55,974 | 5.56 | % | $ | 938,446 | $ | 48,397 | 5.16 | % | ||
| Taxable securities (4) | 605,883 | 15,331 | 2.53 | % | 626,040 | 16,682 | 2.66 | % | ||||||
| Nontaxable securities (1)(4) | 62,700 | 1,824 | 2.91 | % | 63,566 | 1,828 | 2.88 | % | ||||||
| Federal funds sold | 114 | 5 | 4.39 | % | 600 | 26 | 4.33 | % | ||||||
| Interest-bearing deposits | 76,223 | 3,183 | 4.18 | % | 76,211 | 4,070 | 5.34 | % | ||||||
| Total interest-earning assets | $ | 1,751,197 | $ | 76,317 | 4.36 | % | $ | 1,704,863 | $ | 71,003 | 4.16 | % | ||
| Interest-bearing liabilities: | ||||||||||||||
| Interest-bearing demand deposits | $ | 842,479 | $ | 17,094 | 2.03 | % | $ | 838,526 | $ | 20,444 | 2.44 | % | ||
| Savings deposits | 142,547 | 209 | 0.15 | % | 140,707 | 231 | 0.16 | % | ||||||
| Time deposits(5) | 328,286 | 12,068 | 3.68 | % | 313,842 | 13,047 | 4.16 | % | ||||||
| Borrowings | 8,963 | 381 | 4.25 | % | 57 | 2 | 3.51 | % | ||||||
| Total interest-bearing liabilities | $ | 1,322,275 | $ | 29,752 | 2.25 | % | $ | 1,293,132 | $ | 33,724 | 2.61 | % | ||
| Net interest income and interest rate spread | $ | 46,565 | 2.11 | % | $ | 37,279 | 1.55 | % | ||||||
| Net interest margin | 2.66 | % | 2.19 | % |
- Interest on nontaxable loans and securities is computed on a fully taxable equivalent basis using a federal income tax rate of 21%. See “Reconciliation of Non-GAAP Financial Measures” at the end of this release.
- Included in loan interest income are loan fees and net accretion of deferred fees and costs of $503 and $245 for the twelve months ended December 31, 2025 and December 31, 2024, respectively. Also included are net accretion of acquisition discounts of $2,013 and $802 for the twelve months ended December 31, 2025 and December 31, 2024, respectively.
- Includes loans held for sale and nonaccrual loans.
- Daily averages are shown at amortized cost.
- Included in time deposit interest expense is net amortization of acquisition premiums of $149 and $278 for the twelve months ended December 31, 2025 and December 31, 2024, respectively.
National Bankshares, Inc.
Key Ratios and Other Data
(Unaudited)
| As of and for the Three Months Ended | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| ($ in thousands) | December 31, | September 30, | December 31, | ||||||
| 2025 | 2025 | 2024 | |||||||
| Average Balances | |||||||||
| Cash and due from banks | $ | 8,299 | $ | 8,588 | $ | 13,937 | |||
| Interest-bearing deposits | 49,497 | 71,009 | 63,028 | ||||||
| Securities available for sale, at fair value | 633,461 | 587,811 | 612,680 | ||||||
| Mortgage loans held for sale | 252 | 494 | 197 | ||||||
| Loans, gross | 1,012,075 | 1,010,054 | 995,669 | ||||||
| Loans, net of deferred fees and costs | 1,011,142 | 1,009,547 | 995,062 | ||||||
| Loans, net of deferred fees and costs and the ACLL | 1,000,597 | 999,186 | 984,725 | ||||||
| Intangible assets | 12,259 | 12,354 | 12,643 | ||||||
| Total assets | 1,814,520 | 1,789,174 | 1,796,684 | ||||||
| Noninterest-bearing demand deposits | $ | 313,250 | $ | 307,743 | $ | 300,148 | |||
| Interest-bearing demand and savings deposits | 959,733 | 969,174 | 978,852 | ||||||
| Time deposits | 318,446 | 322,782 | 343,653 | ||||||
| Total deposits | 1,591,429 | 1,599,699 | 1,622,653 | ||||||
| Total stockholders' equity | 181,847 | 171,594 | 159,476 | ||||||
| Financial Ratios | |||||||||
| Return on average assets(1) | 1.20 | % | 0.99 | % | 0.68 | % | |||
| Return on average equity(1) | 12.00 | % | 10.29 | % | 7.63 | % | |||
| Efficiency ratio(2) | 55.77 | % | 58.62 | % | 68.84 | % | |||
| Average equity to average assets | 10.02 | % | 9.59 | % | 8.88 | % | |||
| Tangible common equity to tangible assets(3) | 9.53 | % | 9.32 | % | 7.99 | % | |||
| Allowance for Credit Losses on Loans | |||||||||
| Beginning balance | $ | 10,579 | $ | 10,422 | $ | 10,328 | |||
| (Recovery of) provision for credit losses | (644 | ) | 259 | (70 | ) | ||||
| Charge-offs | (177 | ) | (153 | ) | (108 | ) | |||
| Recoveries | 134 | 51 | 112 | ||||||
| Ending Balance | $ | 9,892 | $ | 10,579 | $ | 10,262 |
- The return on average assets and return on average equity are calculated by annualizing net income and dividing by average period-to-date assets or equity, respectively. The Company does not annualize certain income and expense items that are significant and may not be indicative of near-term future expected activity. See “Reconciliation of Non-GAAP Financial Measures” at the end of this release.
- The efficiency ratio is calculated as noninterest expense divided by the sum of noninterest income and net interest income on a fully taxable equivalent basis. Noninterest income and noninterest expense are adjusted for any unusual items. See “Reconciliation of Non-GAAP Financial Measures” at the end of this release.
- Tangible common equity and tangible assets exclude goodwill and intangible assets of $12,208 as of December 31, 2025, $12,297 as of September 30, 2025 and $12,581 as of December 31, 2024. See “Reconciliation of Non-GAAP Financial Measures” at the end of this release.
National Bankshares, Inc.
Key Ratios and Other Data
(Unaudited)
| As of and for the Twelve Months Ended | ||||||
|---|---|---|---|---|---|---|
| ($ in thousands) | December 31, 2025 | December 31, 2024 | ||||
| Average Balances | ||||||
| Cash and due from banks | $ | 10,641 | $ | 12,971 | ||
| Interest-bearing deposits | 76,223 | 76,211 | ||||
| Securities available for sale, at fair value | 603,869 | 610,298 | ||||
| Mortgage loans held for sale | 348 | 306 | ||||
| Loans, gross | 1,006,578 | 938,694 | ||||
| Loans, net of deferred fees and costs | 1,005,929 | 938,140 | ||||
| Loans, net of deferred fees and costs and the ACLL | 995,531 | 928,293 | ||||
| Intangible assets | 12,399 | 9,864 | ||||
| Total assets | 1,809,631 | 1,744,441 | ||||
| Noninterest-bearing demand deposits | $ | 305,115 | $ | 290,038 | ||
| Interest-bearing demand and savings deposits | 985,026 | 979,233 | ||||
| Time deposits | 328,286 | 313,842 | ||||
| Total deposits | 1,618,427 | 1,596,967 | ||||
| Total stockholders' equity | 170,428 | 147,474 | ||||
| Financial Ratios | ||||||
| Return on average assets | 0.87 | % | 0.44 | % | ||
| Return on average equity | 9.29 | % | 5.17 | % | ||
| Efficiency ratio(1) | 60.70 | % | 68.90 | % | ||
| Average equity to average assets | 9.42 | % | 8.45 | % | ||
| Tangible common equity to tangible assets(2) | 9.53 | % | 7.99 | % | ||
| Allowance for Credit Losses on Loans | ||||||
| Beginning balance | $ | 10,262 | $ | 9,094 | ||
| Recovery of credit losses | (63 | ) | (48 | ) | ||
| Acquisition-related provision | – | 1,290 | ||||
| Acquisition-related increase for purchased credit deteriorated loans | – | 175 | ||||
| Charge-offs | (583 | ) | (519 | ) | ||
| Recoveries | 276 | 270 | ||||
| Ending Balance | $ | 9,892 | $ | 10,262 |
- The efficiency ratio is calculated as noninterest expense divided by the sum of noninterest income and net interest income on a fully taxable equivalent basis. Noninterest income and noninterest expense are adjusted for any unusual items. See “Reconciliation of Non-GAAP Financial Measures” at the end of this release.
- Tangible common equity and tangible assets exclude goodwill and intangible assets of $12,208 as of December 31, 2025 and $12,581 as of December 31, 2024. See “Reconciliation of Non-GAAP Financial Measures” at the end of this release.
National Bankshares, Inc.
Asset Quality Data
(Unaudited)
| ($ in thousands) | December 31, | September 30, | December 31, | ||||||
|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2025 | 2024 | |||||||
| Nonperforming Assets | |||||||||
| Nonaccrual loans | $ | 188 | $ | 2,027 | $ | 2,222 | |||
| Total nonperforming assets | $ | 188 | $ | 2,027 | $ | 2,222 | |||
| Loans past due 90 days or more, and still accruing | $ | 881 | $ | 283 | $ | 548 | |||
| Asset Quality Ratios | |||||||||
| Ratio of nonperforming loans to total loans(1) | 0.02 | % | 0.20 | % | 0.22 | % | |||
| ACLL to total loans(1) | 0.99 | % | 1.04 | % | 1.04 | % | |||
| Ratio of ACLL to nonperforming loans | 5261.70 | % | 521.90 | % | 461.84 | % | |||
| Loans past due 90 days or more to total loans (1) | 0.09 | % | 0.03 | % | 0.06 | % |
- Loans are net of deferred fees and costs.
National Bankshares, Inc.
Reconciliation of Non-GAAP Financial Measures
(Unaudited)
In addition to financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company uses certain non-GAAP financial measures that provide useful information for financial and operational decision making, evaluating trends, and comparing financial results to other financial institutions. Non-GAAP financial measures are supplemental and not a substitute for, or more important than, financial measures prepared in accordance with GAAP and may not be comparable to those reported by other financial institutions.
The non-GAAP financial measures presented in this document include the net interest margin, the efficiency ratio, the ratio of tangible common equity to tangible assets, adjusted return on average assets and adjusted return on average equity. For periods that are shorter than twelve months, the Company annualizes net income for the return on average assets and return on average equity. In order to prevent distortion, the Company does not annualize certain income and expense items that are significant and may not be indicative of near-term future expected activity.
The following tables present calculations underlying non-GAAP financial measures for the periods indicated.
| (in thousands) | Three Months Ended | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Net Interest Margin, FTE | December 31, 2025 | September 30, 2025 | December 31, 2024 | ||||||
| Interest income (GAAP) | $ | 19,569 | $ | 19,010 | $ | 18,283 | |||
| Add: FTE adjustment | 277 | 244 | 239 | ||||||
| Interest income, FTE (non-GAAP) | 19,846 | 19,254 | 18,522 | ||||||
| Interest expense (GAAP) | 6,923 | 7,336 | 8,312 | ||||||
| Net interest income, FTE (non-GAAP) | $ | 12,923 | $ | 11,918 | $ | 10,210 | |||
| Average balance of interest-earning assets | $ | 1,748,114 | $ | 1,731,992 | $ | 1,741,235 | |||
| Net interest margin | 2.93 | % | 2.73 | % | 2.33 | % | |||
| (in thousands) | Three Months Ended | ||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Efficiency Ratio | December 31, 2025 | September 30, 2025 | December 31, 2024 | ||||||
| Noninterest expense (GAAP) | $ | 8,674 | $ | 8,524 | $ | 8,620 | |||
| Less: merger-related expense | – | – | (25 | ) | |||||
| Less: core system conversion expense | (3 | ) | (50 | ) | – | ||||
| Adjusted noninterest expense (non-GAAP) | $ | 8,671 | $ | 8,474 | $ | 8,595 | |||
| Noninterest income (GAAP) | $ | 2,626 | $ | 2,537 | $ | 2,276 | |||
| Net interest income, FTE (non-GAAP) | 12,923 | 11,918 | 10,210 | ||||||
| Total income for efficiency ratio (non-GAAP) | $ | 15,549 | $ | 14,455 | $ | 12,486 | |||
| Efficiency ratio | 55.77 | % | 58.62 | % | 68.84 | % | |||
| (in thousands) | |||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | |
| September 30, | December 31, | ||||||||
| Annualized Net Income for Ratio Calculation | 2025 | 2024 | |||||||
| Net income per GAAP | 5,881 | $ | 4,420 | $ | 3,079 | ||||
| Less: expenses not annualized: | |||||||||
| ACLL recovery, net of tax of (135) and (13) for the periods ended December 31, 2025 and December 31, 2024, respectively | (509 | ) | – | (47 | ) | ||||
| Merger-related expense, net of tax of 5 for the period ended September 30, 2024 | – | – | 20 | ||||||
| Core system conversion expense, net of tax of 1 and 11 for the periods ended December 31, 2025 and September 30, 2025, respectively | 2 | 39 | – | ||||||
| Total non-annualized items | (507 | ) | 39 | (27 | ) | ||||
| Adjusted net income | 5,374 | 4,459 | 3,052 | ||||||
| Adjusted net income, annualized | 21,321 | $ | 17,691 | $ | 12,142 | ||||
| Add: total non-annualized items | 507 | (39 | ) | 27 | |||||
| Annualized net income for ratio calculation (non-GAAP) | 21,828 | $ | 17,652 | $ | 12,169 | ||||
| Return on average assets (GAAP) | 1.29 | % | 0.98 | % | 0.68 | % | |||
| Adjusted return on average assets (non-GAAP) | 1.20 | % | 0.99 | % | 0.68 | % | |||
| Return on average equity (GAAP) | 12.83 | % | 10.22 | % | 7.68 | % | |||
| Adjusted return on average equity (non-GAAP) | 12.00 | % | 10.29 | % | 7.63 | % |
All values are in US Dollars.
The following tables present calculations underlying non-GAAP financial measures for the periods indicated.
| Year Ended December 31, | ||||||
|---|---|---|---|---|---|---|
| Net Interest Margin, FTE | 2025 | 2024 | ||||
| Interest income (GAAP) | $ | 75,313 | $ | 70,035 | ||
| Add: FTE adjustment | 1,004 | 968 | ||||
| Interest income, FTE (non-GAAP) | 76,317 | 71,003 | ||||
| Interest expense (GAAP) | 29,752 | 33,724 | ||||
| Net interest income, FTE (non-GAAP) | $ | 46,565 | $ | 37,279 | ||
| Average balance of interest-earning assets | $ | 1,751,197 | $ | 1,704,863 | ||
| Net interest margin (non-GAAP) | 2.66 | % | 2.19 | % | ||
| Year Ended December 31, | ||||||
| --- | --- | --- | --- | --- | --- | --- |
| Efficiency Ratio | 2025 | 2024 | ||||
| Noninterest expense (GAAP) | $ | 36,413 | $ | 35,008 | ||
| Less: merger-related expense | - | (2,916 | ) | |||
| Less: core system conversion expense | (2,076 | ) | (173 | ) | ||
| Adjusted noninterest expense (non-GAAP) | $ | 34,337 | $ | 31,919 | ||
| Noninterest income (GAAP) | $ | 10,002 | $ | 9,046 | ||
| Net interest income, FTE (non-GAAP) | 46,565 | 37,279 | ||||
| Total income for efficiency ratio (non-GAAP) | $ | 56,567 | $ | 46,325 | ||
| Efficiency ratio (non-GAAP) | 60.70 | % | 68.90 | % |
The following table presents calculations underlying non-GAAP financial measures as of the dates indicated.
| As of | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| (in thousands) | December 31, | September 30, | December 31, | ||||||
| 2025 | 2025 | 2024 | |||||||
| Tangible Assets | |||||||||
| Total assets (GAAP) | $ | 1,824,506 | $ | 1,802,407 | $ | 1,811,636 | |||
| Less: goodwill and intangible assets | (12,208 | ) | (12,297 | ) | (12,581 | ) | |||
| Tangible assets (non-GAAP) | $ | 1,812,298 | $ | 1,790,110 | $ | 1,799,055 | |||
| Tangible Common Equity | |||||||||
| Total stockholders' equity (GAAP) | $ | 184,908 | $ | 179,220 | $ | 156,409 | |||
| Less: goodwill and intangible assets | (12,208 | ) | (12,297 | ) | (12,581 | ) | |||
| Tangible common equity (non-GAAP) | $ | 172,700 | $ | 166,923 | $ | 143,828 |