National Bankshares Inc 8-K, filed Feb 2, 2023

National Bankshares Inc (NKSH)

8-K 2023-02-02 For: 2023-02-02

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Added on April 07, 2026

About this 8-K

National Bankshares Inc filed this 8-K on February 2, 2023.

Items reported

Item 2.02: Financial results
Item 9.01: Financial statements and exhibits

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Virginia	0-15204	54-1375874
(State or other jurisdiction of incorporation)	(Commission File No.)	(I.R.S. Employer Identification No.)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	NKSH	NASDAQ

($ in thousands, except per share data)	December 31, 2022			September 30, 2022			December 31, 2021
Assets
Cash and due from banks	$	12,403		$	10,957		$	8,768
Interest-bearing deposits		59,026			79,466			130,021
Securities available for sale, at fair value		656,852			657,410			686,080
Restricted stock		941			941			845
Mortgage loans held for sale		-			-			615
Loans:
Loans, net of unearned income and deferred fees and costs		852,744			852,863			803,248
Less: allowance for loan losses		(8,225	)		(8,207	)		(7,674	)
Loans, net		844,519			844,656			795,574
Premises and equipment, net		10,371			10,183			9,722
Accrued interest receivable		6,001			5,822			5,104
Other real estate owned, net		662			907			957
Goodwill		5,848			5,848			5,848
Bank-owned life insurance		43,312			43,072			42,354
Other assets		37,616			39,684			16,287
Total assets	$	1,677,551		$	1,698,946		$	1,702,175

Liabilities and Stockholders' Equity
Noninterest-bearing deposits	$	327,713		$	358,772		$	317,430
Interest-bearing demand deposits		933,269			917,449			890,124
Savings deposits		214,114			217,405			208,065
Time deposits		67,629			77,023			78,968
Total deposits		1,542,725			1,570,649			1,494,587
Accrued interest payable		106			40			48
Other liabilities		12,033			16,070			15,789
Total liabilities		1,554,864			1,586,759			1,510,424
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. Authorized 10,000,000 shares; issued and outstanding 5,889,687 shares at December 31, 2022, 5,957,275 shares at September 30, 2022 and 6,063,937 shares at December 31, 2021		7,362			7,447			7,580
Retained earnings		199,091			196,941			188,229
Accumulated other comprehensive loss, net		(83,766	)		(92,201	)		(4,058	)
Total stockholders' equity		122,687			112,187			191,751
Total liabilities and stockholders' equity	$	1,677,551		$	1,698,946		$	1,702,175

	Three Months Ended				Twelve Months Ended
($ in thousands, except per share data)	December 31, 2022		September 30, 2022		December 31, 2022			December 31, 2021
Interest Income
Interest and fees on loans	$	9,013	$	8,816	$	34,253		$	34,923
Interest on interest-bearing deposits		596		506		1,353			170
Interest on securities - taxable		3,941		3,425		12,788			7,960
Interest on securities - nontaxable		432		408		1,715			1,934
Total interest income		13,982		13,155		50,109			44,987
Interest Expense
Interest on time deposits		36		31		141			267
Interest on other deposits		992		722		2,942			2,831
Total interest expense		1,028		753		3,083			3,098
Net interest income		12,954		12,402		47,026			41,889
Provision for (recovery of) loan losses		10		252		706			(398	)
Net interest income after provision for (recovery of) loan losses		12,944		12,150		46,320			42,287
Noninterest Income
Service charges on deposit accounts		599		661		2,425			2,045
Other service charges and fees		57		51		214			179
Credit and debit card fees, net		493		448		1,916			1,869
Trust income		443		492		1,817			1,792
BOLI income		240		239		958			910
Gain on sale of mortgage loans		21		40		157			364
Gain on sale of private equity investment		3,823		-		3,823			-
Other income		182		209		1,091			1,261
Realized securities gain, net		-		-		-			6
Total noninterest income		5,858		2,140		12,401			8,426

Noninterest Expense
Salaries and employee benefits		4,386		4,144		16,519			15,747
Occupancy and furniture and fixtures		502		476		1,934			1,842
Data processing and ATM		832		774		3,186			3,039
FDIC assessment		141		114		477			422
Net costs of other real estate owned		247		68		325			51
Franchise taxes		375		375		1,483			1,425
Other operating expenses		815		785		3,034			3,554
Total noninterest expense		7,298		6,736		26,958			26,080
Income before income tax expense		11,504		7,554		31,763			24,633
Income tax expense		2,194		1,392		5,831			4,251
Net Income	$	9,310	$	6,162	$	25,932		$	20,382
Basic and fully diluted net income per common share	$	1.57	$	1.03	$	4.33		$	3.28
Weighted average number of common shares outstanding
Basic and Diluted		5,933,201		5,974,961		5,989,601			6,209,929
Dividends declared per common share	$	0.78	$	-	$	1.50		$	1.44
Dividend payout ratio		-		-		34.51	%		43.20	%
Book value per share	$	20.83	$	18.83	$	20.83		$	31.62

	Three Months Ended
($ in thousands)	December 31, 2022		September 30, 2022
Net income	$	9,310	$	6,162

Other Comprehensive Income (Loss), Net of Tax
Unrealized holding gain (loss) on available for sale securities net of tax of $1,028 for the period ended December 31, 2022 and ($7,822) for the period ended September 30, 2022		3,868		(29,424	)
Net pension gain arising during the period, net of taxes of $1,214 for the period ended December 31, 2022		4,567		-
Other comprehensive income (loss), net of tax	$	8,435	$	(29,424	)
Total Comprehensive Income (Loss)	$	17,745	$	(23,262	)

	Three Months Ended December 31, 2022							Three Months Ended September 30, 2022
	Average Balance		Interest		Average Yield/ Rate			Average Balance		Interest		Average Yield/ Rate
Interest-earning assets:
Loans ^(1)(2)(4)	$	845,373	$	9,095		4.27	%	$	849,929	$	8,900		4.15	%
Taxable securities ⁽⁵⁾⁽⁶⁾		689,370		3,941		2.27	%		683,490		3,425		1.99	%
Nontaxable securities ⁽¹⁾⁽⁵⁾		74,540		580		3.09	%		74,670		556		2.95	%
Interest-bearing deposits		62,393		596		3.79	%		89,165		506		2.25	%
Total interest-earning assets	$	1,671,676	$	14,212		3.37	%	$	1,697,254	$	13,387		3.13	%
Interest-bearing liabilities:
Interest-bearing demand deposits	$	908,209	$	955		0.42	%	$	936,368	$	686		0.29	%
Savings deposits		215,594		37		0.07	%		217,637		36		0.07	%
Time deposits		70,874		36		0.20	%		78,198		31		0.16	%
Total interest-bearing liabilities	$	1,194,677	$	1,028		0.34	%	$	1,232,203	$	753		0.24	%
Net interest income and interest rate spread			$	13,184		3.03	%			$	12,634		2.89	%
Net yield on average interest‑earning assets						3.13	%						2.95	%

	Twelve Months Ended December 31, 2022							Twelve Months Ended December 31, 2021
	Average Balance		Interest		Average Yield/ Rate			Average Balance		Interest		Average Yield/ Rate
Interest-earning assets:
Loans ^(1)(3)(4)	$	833,226	$	34,579		4.15	%	$	787,754	$	35,241		4.47	%
Taxable securities ⁽⁵⁾⁽⁶⁾		669,515		12,788		1.91	%		524,818		7,960		1.52	%
Nontaxable securities ⁽¹⁾⁽⁵⁾		75,487		2,308		3.06	%		80,059		2,577		3.22	%
Interest-bearing deposits		88,963		1,353		1.52	%		133,020		170		0.13	%
Total interest-earning assets ⁽⁷⁾	$	1,667,191	$	51,028		3.06	%	$	1,525,651	$	45,948		3.01	%
Interest-bearing liabilities:
Interest-bearing demand deposits	$	910,989	$	2,794		0.31	%	$	811,661	$	2,657		0.33	%
Savings deposits		216,414		148		0.07	%		190,997		174		0.09	%
Time deposits		77,686		141		0.18	%		86,089		267		0.31	%
Total interest-bearing liabilities	$	1,205,089	$	3,083		0.26	%	$	1,088,747	$	3,098		0.28	%
Net interest income and interest rate spread			$	47,945		2.80	%			$	42,850		2.73	%
Net yield on average interest‑earning assets						2.88	%						2.81	%

	⁽¹⁾	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.
	⁽²⁾	Interest income includes loan fees of $35 and $82 for the three months ended December 31, 2022 and September 30, 2022, respectively.
	⁽³⁾	Interest income includes loan fees of $230 and $2,558 for the twelve months ended December 31, 2022 and 2021, respectively.
	⁽⁴⁾	Includes loans held for sale and nonaccrual loans.
	⁽⁵⁾	Daily averages are shown at amortized cost.
	⁽⁶⁾	Includes restricted stock.
	⁽⁷⁾	In 2021, PPP loans contributed 17 basis points to the FTE yield on earning assets. On a comparable basis, excluding PPP loans from 2021, the yield on earning assets was 2.84%.

(1)	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. Any significant nonrecurring items within net income are not annualized. See "Reconciliation of Non-GAAP Financial Measures" at the end of this release.
(2)	The dividend yield is calculated as annual dividends per common share divided by the average closing share price over the year.
(3)	The efficiency ratio is calculated as noninterest expense divided by the sum of noninterest income, less non-recurring items, and net interest income on a fully taxable equivalent basis. See "Reconciliation of Non-GAAP Financial Measures" at the end of this release.

($ in thousands)	December 31, 2022			September 30, 2022			December 31, 2021
Tangible Assets
Total assets (GAAP)	$	1,677,551		$	1,698,946		$	1,702,175
Less: Goodwill		(5,848	)		(5,848	)		(5,848	)
Tangible assets (non-GAAP)	$	1,671,703		$	1,693,098		$	1,696,327

Tangible Common Equity
Total stockholders' equity (GAAP)	$	122,687		$	112,187		$	191,751
Less: Goodwill		(5,848	)		(5,848	)		(5,848	)
Tangible common equity (non-GAAP)	$	116,839		$	106,339		$	185,903

Average Assets Excluding Unrealized Loss on Securities
Average assets (GAAP)	$	1,705,614		$	1,716,907		$	1,618,642
Average unrealized loss (gain) on securities		60,899			44,414			(7,759	)
Average deferred tax (asset) liability, unrealized loss on securities		(12,789	)		(9,327	)		1,012
Average assets excluding unrealized loss on securities (non-GAAP)	$	1,753,724		$	1,751,994		$	1,611,895

Average Stockholders’ Equity Excluding AOCI
Average stockholders’ equity (GAAP)	$	145,641		$	157,540		$	192,545
Average accumulated other comprehensive loss		55,009			41,999			4,008
Average stockholders’ equity excluding AOCI (non-GAAP)	$	200,650		$	199,539		$	196,553

($ in thousands)	December 31, 2022			September 30, 2022
Nonperforming Assets
Nonaccrual loans	$	91		$	118
Nonaccrual restructured loans		2,756			2,770
Total nonperforming loans		2,847			2,888
Other real estate owned	$	662		$	907
Total nonperforming assets	$	3,509		$	3,795
Accruing restructured loans		276			279
Loans 90 days or more past due and accruing	$	8		$	48

Asset Quality Ratios
Nonperforming assets to loans⁽¹⁾ plus other real estate owned		0.41	%		0.44	%
Allowance for loans losses to total loans⁽¹⁾		0.96	%		0.96	%
Allowance for loan losses to nonperforming loans		288.90	%		284.18	%
Loans past due 90 days or more to loans⁽¹⁾		0.00	%		0.01	%