National Bankshares, Inc. And Subsidiaries
(000's), except ratios and percent data
Three months ending September September
30, 2006 30, 2005 Change
Selected Consolidated Data: --------- --------- ---------
Interest income $ 12,042 $ 11,483 4.87%
--------- --------- ---------
Interest expense 4,691 3,816 22.93%
--------- --------- ---------
Net interest income 7,351 7,667 -4.12%
--------- --------- ---------
Provision for loan losses 16 169 -90.53%
--------- --------- ---------
Trust income 314 326 -3.68%
--------- --------- ---------
Other noninterest income 1,918 1,566 22.48%
--------- --------- ---------
Salary and benefits 2,866 2,822 1.56%
--------- --------- ---------
Occupancy expense 474 491 -3.46%
--------- --------- ---------
Amortization of intangibles 284 283 0.35%
--------- --------- ---------
Other noninterest expense 1,772 1,783 -0.62%
--------- --------- ---------
Income taxes -970 -957 1.36%
--------- --------- ---------
Net income $ 3,201 $ 3,054 4.81%
--------- --------- ---------
Basic net income per share $ 0.46 $ 0.44 $ 0.02
--------- --------- ---------
Daily averages:
--------- --------- ---------
Gross loans $ 495,539 $ 497,152 -0.32%
--------- --------- ---------
Loans, net 489,243 490,614 -0.28%
--------- --------- ---------
Total securities 267,339 261,951 2.06%
--------- --------- ---------
Total deposits 732,009 728,295 0.51%
--------- --------- ---------
Other borrowings 582 70 731.43%
--------- --------- ---------
Stockholders' equity 95,443 91,071 4.80%
--------- --------- ---------
Cash and due from 15,113 16,077 -6.00%
--------- --------- ---------
Interest-earning assets 771,234 775,015 -0.49%
--------- --------- ---------
Interest-bearing liabilities 627,895 615,276 2.05%
--------- --------- ---------
Intangible assets 16,424 17,554 -6.44%
--------- --------- ---------
Total assets 832,157 823,188 1.09%
--------- --------- ---------
Financial ratios: Note (1)
--------- --------- ---------
Return on average assets 1.53% 1.51% 0.02
--------- --------- ---------
Return on average equity 13.31% 13.69% -0.38
--------- --------- ---------
Net interest margin 4.04% 4.25% -0.21
--------- --------- ---------
Average equity to average assets 11.47% 11.06% 0.41
--------- --------- ---------
Note (1) Ratio change measured in bp
Allowance for loan losses:
--------- --------- ---------
Beginning balance $ 5,340 $ 5,632 -5.18%
--------- --------- ---------
Provision for losses 16 169 -90.53%
--------- --------- ---------
Charge-offs -136 -227 -40.09%
--------- --------- ---------
Recoveries 32 46 -30.43%
--------- --------- ---------
Ending balance $ 5,252 $ 5,620 -6.55%
--------- --------- ---------
Year to Date September September
30, 2006 30, 2005 Change
Selected Consolidated Data: --------- --------- ---------
Interest income $ 35,474 $ 33,786 5.00%
--------- --------- ---------
Interest expense 13,303 10,085 31.91%
--------- --------- ---------
Net interest income 22,171 23,701 -6.46%
--------- --------- ---------
Provision for loan losses 40 557 -92.82%
--------- --------- ---------
Trust income 1,059 1,062 -0.28%
--------- --------- ---------
Other noninterest income 5,444 4,525 20.31%
--------- --------- ---------
Salary and benefits 8,706 8,534 2.02%
--------- --------- ---------
Occupancy expense 1,479 1,450 2.00%
--------- --------- ---------
Amortization of intangibles 853 832 2.52%
--------- --------- ---------
Other noninterest expense 5,258 5,843 -10.01%
--------- --------- ---------
Income taxes -2,907 -2,873 1.18%
--------- --------- ---------
Net income $ 9,431 $ 9,199 2.52%
--------- --------- ---------
Basic net income per share $ 1.35 $ 1.31 $ 0.04
--------- --------- ---------
Fully diluted net income per share $ 1.34 $ 1.30 $ 0.04
--------- --------- ---------
Dividends per share .46 .35 $ 0.11
--------- --------- ---------
Dividend payout ratio 26.77 26.52 $ 0.25
--------- --------- ---------
Book value per share $ 14.00 13.20 $ 0.80
--------- --------- ---------
Balance sheet at period-end:
--------- --------- ---------
Gross loans $ 498,626 $ 499,787 -0.23%
--------- --------- ---------
Loans, net $ 492,353 $ 493,240 -0.18%
--------- --------- ---------
Total securities 266,740 263,943 1.06%
--------- --------- ---------
Cash and due from 14,598 17,114 -14.70%
--------- --------- ---------
Total deposits 742,793 732,177 1.45%
--------- --------- ---------
Other borrowings 76 623 -87.80%
--------- --------- ---------
Stockholders' equity 97,803 92,670 5.54%
--------- --------- ---------
Intangible assets 16,260 17,397 -6.54%
--------- --------- ---------
Total assets 844,997 828,907 1.94%
--------- --------- ---------
Daily averages:
--------- --------- ---------
Gross loans $ 491,829 $ 492,908 -0.22%
--------- --------- ---------
Loans, net 485,488 486,338 -0.17%
--------- --------- ---------
Total securities 270,524 256,713 5.38%
--------- --------- ---------
Total deposits 736,511 719,989 2.29%
--------- --------- ---------
Other borrowings 495 758 -34.70%
--------- --------- ---------
Stockholders' equity 94,499 85,343 10.73%
--------- --------- ---------
Cash and due from 16,028 15,769 1.64%
--------- --------- ---------
Interest-earning assets 772,356 762,072 1.35%
--------- --------- ---------
Interest-bearing liabilities 626,744 606,678 3.31%
--------- --------- ---------
Intangible assets 16,687 17,519 -4.75%
--------- --------- ---------
Total assets 835,494 810,292 3.11%
--------- --------- ---------
Financial ratios: Note (1)
--------- --------- ---------
Return on average assets 1.51% 1.51% 0.00
--------- --------- ---------
Return on average equity 13.34% 13.69% -0.35
--------- --------- ---------
Net interest margin 4.17% 4.53% -0.36
--------- --------- ---------
Efficiency ratio 53.08% 52.84% 0.24
--------- --------- ---------
Average equity to average assets 11.31% 10.53% 0.78
--------- --------- ---------
Note (1) Ratio change measured in bp
Allowance for loan losses:
--------- --------- ---------
Beginning balance $ 5,449 $ 5,729 -4.89%
--------- --------- ---------
Provision for losses 40 557 -92.82%
--------- --------- ---------
Charge-offs -345 -812 -57.51%
--------- --------- ---------
Recoveries 108 146 -26.03%
--------- --------- ---------
Ending balance $ 5,252 $ 5,620 -6.55%
--------- --------- ---------
Nonperforming assets:
--------- --------- ---------
Nonaccrual loans 4 $ 251 -100.00%
--------- --------- ---------
Total nonperforming loans Note (2) 4 251 -100.00%
--------- --------- ---------
Other real estate owned 390 429 -9.09%
--------- --------- ---------
Total nonperforming assets $ 394 $ 680 -42.06%
--------- --------- ---------
Asset quality ratios: Note (3)
--------- --------- ---------
Nonperforming loans to total loans 0.001% 0.05% -98.42%
--------- --------- ---------
Allowance for loan losses to total loans 1.06% 1.13% -7.45%
--------- --------- ---------
Allowance for loan losses
to nonperforming loans 1,313.00% 2,239.04% -41.36%
--------- --------- ---------
Note (2) Loans 90 days past due or more not included
Note (3) Ratio change measured in bp
Contact Information: CONTACTS: James G. Rakes Chairman, President & CEO (540) 951-6236 J. Robert Buchanan Treasurer (276) 979-0341