VIRGINIA NATIONAL BANKSHARES CORPORATION ANNOUNCES 2024 THIRD QUARTER EARNINGS

Rhea-AI Summary

Virginia National Bankshares (NASDAQ: VABK) reported Q3 2024 net income of $4.6 million, or $0.85 per diluted share, compared to $4.7 million, or $0.86 per diluted share, in Q3 2023. Year-to-date net income for 2024 was $12.4 million, down from $16.1 million in 2023, primarily due to increased cost of funds.

Key highlights include:

• Loan growth of 11% in 2024 and 19% year-over-year
• Net interest margin improved to 3.24% from 3.04% in Q2 2024
• Efficiency ratio improved to 58.6% from 62.7% in Q2 2024
• Gross loans outstanding totaled $1.2 billion as of September 30, 2024
• Nonperforming assets as a percentage of total assets was 0.33%
• Book value per share increased to $30.89 from $25.29 year-over-year

The company continues to focus on reducing overhead costs and maintaining strong credit quality metrics.

Positive

• Loan growth of 11% in 2024 and 19% year-over-year
• Net interest margin improved to 3.24% from 3.04% in Q2 2024
• Efficiency ratio improved to 58.6% from 62.7% in Q2 2024
• Book value per share increased to $30.89 from $25.29 year-over-year
• Net interest income for Q3 2024 increased $924 thousand, or 8.3%, compared to Q3 2023
• Yield on loans increased to 5.85% for Q3 2024, compared to 5.53% for the prior year same period

Negative

• Year-to-date net income for 2024 decreased to $12.4 million from $16.1 million in 2023
• Overall cost of funds increased to 207 bps in Q3 2024 from 172 bps in Q3 2023
• Noninterest income for Q3 2024 decreased $1.2 million, or 45.1%, compared to Q3 2023
• Nonperforming assets increased to $5.3 million as of September 30, 2024, compared to $2.0 million as of September 30, 2023

Insights

Financial Analyst

Virginia National Bankshares 's Q3 2024 results show mixed performance. The company reported quarterly net income of $4.6 million ($0.85 per diluted share), slightly down from $4.7 million ($0.86 per diluted share) in Q3 2023. Year-to-date net income decreased to $12.4 million from $16.1 million in the previous year, primarily due to increased cost of funds.

Key positives include:

• Loan growth of 11% year-to-date and 19% year-over-year
• Improved net interest margin to 3.24% from 3.04% in Q2 2024
• Strong credit quality with nonperforming assets at 0.33% of total assets
• Reduced noninterest expenses, down 4.8% year-over-year

However, challenges persist with increased cost of funds and decreased noninterest income. The bank's efforts to reduce overhead costs and grow its loan portfolio are positive signs, but the impact of higher interest rates on funding costs remains a concern. The stable capital and liquidity positions provide a solid foundation for navigating the current economic environment.

CHARLOTTESVILLE, Va., Oct. 17, 2024 /PRNewswire/ -- Virginia National Bankshares Corporation (NASDAQ: VABK) (the "Company") today reported quarterly net income of $4.6 million, or $0.85 per diluted share, for the quarter ended September 30, 2024, compared to $4.7 million, or $0.86 per diluted share, recognized for the quarter ended September 30, 2023.  For the nine months ended September 30, 2024, the Company recognized net income of $12.4 million, or $2.30 per diluted share, compared to $16.1 million, or $2.99 per diluted share, for the nine months ended September 30, 2023. 

The decline in year-to-date 2024 net income compared to 2023 is primarily the result of 1) increased cost of funds and 2) the receipt in the prior year of bank-owned life insurance proceeds as a result of the death of a former employee, which was offset by an increase in interest income and a decline in operating expenses. 

President and Chief Executive Officer's comments:  "Our measures to reduce ongoing overhead costs are paying off for us as evidenced through reduced noninterest expenses," stated Glenn W. Rust, President and Chief Executive Officer.  "In addition, we continue to put new loans on the books, increasing loan balances 11% during 2024 and 19% year-over-year, and our credit quality metrics remain strong.  Our capital and liquidity positions continue to be solid and stable."

Key Performance Indicators
Third Quarter 2024 Compared to Second Quarter 2024

• • Return on average assets increased to 1.15% from 1.05%
  • Return on average equity increased to 11.44% from 11.07%
  • Net interest margin (FTE)¹ improved to 3.24% from 3.04%
  • Loan-to-deposit ratio increased to 88.1% from 84.3%
  • Efficiency ratio (FTE)¹ improved to 58.6% from 62.7%

September 2024 Balance Sheet Highlights

• The Company continued to experience loan growth in the third quarter of 2024. Gross loans outstanding as of September 30, 2024 totaled $1.2 billion, an increase of $122.8 million, or 11.2%, compared to December 31, 2023 and an increase of $195.0 million, or 19.1%, compared to September 30, 2023.
• As of September 30, 2024, the Company had unused borrowing facilities in place of approximately $160.4 million and held no brokered deposits.
• Securities balances declined $141.9 million from December 31, 2023 to September 30, 2024; funds from the maturities of investments were repurposed to higher yielding assets in the form of loans.
• The Company utilizes a third-party to offer multi-million-dollar FDIC insurance to customers with balances in excess of single-bank limits through Insured Cash Sweep^® (ICS) plans. Deposit balances held in ICS plans amounted to $145.6 million as of September 30, 2024, $151.5 million as of December 31, 2023 and $128.7 million as of September 30, 2023.
• Total deposits decreased $29.2 million, or 2.1% from December 31, 2023 to September 30, 2024 and increased $9.6 million, or 0.7% year-over-year.
• Outstanding borrowings declined $14.0 million, or 21.1%, from December 31, 2023 to September 30, 2024, as management made a concerted effort to stabilize overall cost of funds.

Loans and Asset Quality

• Credit performance remains strong with nonperforming assets as a percentage of total assets of 0.33% as of September 30, 2024, 0.17% as of December 31, 2023 and 0.13% as of September 30, 2023.
• Nonperforming assets amounted to $5.3 million as of September 30, 2024, compared to $2.7 million as of December 31, 2023 and $2.0 million as of September 30, 2023;
  • Ten loans to nine borrowers are in non-accrual status, totaling $2.1 million, as of September 30, 2024, compared to $1.9 million as of December 31, 2023 and $1.1 million as of September 30, 2023.
  • Loans 90 days or more past due and still accruing interest amounted to $3.2 million as of September 30, 2024, compared to $880 thousand as of December 31, 2023 and $854 thousand as of September 30, 2023. The past due balance as of September 30, 2024 is comprised of four loans totaling $3.1 million which are 100% government-guaranteed, and four student loans totaling $66 thousand.
  • The Company currently holds no other real estate owned.
• The period-end Allowance for Credit Losses ("ACL") as a percentage of total loans was 0.70% as of September 30, 2024, 0.77% as of December 31, 2023 and 0.76% as of September 30, 2023. The proportionate increase in government-guaranteed loans over the respective periods is the driver of the decrease in the ACL as a percentage of total loans. Balances in government-guaranteed loans have increased $111.1 million during the first nine months of 2024 and have increased $141.3 million since September 30, 2023. Such loans are 100% government-guaranteed and do not require an ACL.
• The fair value mark that was allocated to the acquired loans was $21.3 million as of April 1, 2021, with a remaining balance of $7.3 million as of September 30, 2024.
• For the three months ended September 30, 2024, the Company recorded a net recovery of provision for credit losses of $114 thousand, as the recovery of a previously charged-off loan nearly offset the increase in provision required for new loan balances; this balance includes a $111 thousand recovery of provision for unfunded reserves, as a result of a decline in unfunded construction commitments.

Net Interest Income

• Net interest income for the three months ended September 30, 2024 of $12.0 million increased $924 thousand, or 8.3%, compared to the three months ended September 30, 2023, as the increase in interest income earned on assets outweighed the interest expense on deposit accounts and borrowings.
• Net interest margin (FTE), (a non-GAAP financial measure)¹, for the three months ended September 30, 2024 was 3.24%, compared to 2.89% and 3.04% for the three months ended December 31, 2023 and the three months ended September 30, 2023, respectively. The increase as compared to the third quarter of 2023 was primarily due to the increase in yield on loans, described below.
• Yield on loans was 5.85% for the three months ended September 30, 2024, compared to 5.53% for the prior year same period, and was 5.73% for the nine months ended September 30, 2024, compared to 5.81% for the prior year same period. The accretion of the credit mark related to purchased loans positively impacted interest income by 25 bps in the third quarter of 2024, compared to 27 bps in the third quarter of 2023.
• The overall cost of funds, including noninterest-bearing deposits, of 207 bps incurred in the three months ended September 30, 2024 increased 35 bps from 172 bps in the same period in the prior year. Overall, the cost of interest-bearing deposits increased period over period, from a cost of 226 bps to 271 bps. Management believes that the Bank's cost of funds stabilized during the first half of 2024, as the cost of funds and cost of interest bearing deposits is relatively unchanged during the nine months ended September 30, 2024.

_____________________________________________________________________

1	See "Reconciliation of Certain Quarterly Non-GAAP Financial Measures" at the end of this release.

Noninterest Income
Noninterest income for the three months ended September 30, 2024 decreased $1.2 million, or 45.1%, compared to the three months ended September 30, 2023, primarily due to the recognition of bank-owned life insurance proceeds during the prior period due to the death of a former employee, as well as lower wealth management, deposit account, debit card, credit card and ATM fees.  

Noninterest Expense
Noninterest expense for the three months ended September 30, 2024 decreased $397 thousand, or 4.8%, compared to the three months ended September 30, 2023.  This decrease is primarily the result of lower compensation and occupancy costs, as a result of right-sizing the branch network from the merger, and reduced marketing, advertising and promotion expense.

Book Value
Book value per share increased to $30.89 as of September 30, 2024, compared to $25.29 as of September 30, 2023, and tangible book value per share (a non-GAAP financial measure)¹ was $28.68 as of September 30, 2024 compared to $22.83 as of September 30, 2023.  These values increased as net retained income increased and unrealized losses in the investment portfolio declined period over period.

Income Taxes
The effective tax rates amounted to 18.5% and 15.0% for the three months ended September 30, 2024 and 2023, respectively, which are lower than the statutory rate, due to the recognition of low-income housing tax credits and the effect of tax-exempt income from municipal bonds and income from bank owned life insurance policies.

Dividends
Cash dividends of $1.8 million, or $0.33 per share, were declared and paid during the third quarter of 2024.

Share Repurchase Plan
Year-to-date, the Company has repurchased 20,350 shares at an average price of $27.42 per share.  No shares were repurchased during the third quarter of 2024.

_____________________________________________________________________

1	See "Reconciliation of Certain Quarterly Non-GAAP Financial Measures" at the end of this release.

About Virginia National Bankshares Corporation

Virginia National Bankshares Corporation, headquartered in Charlottesville, Virginia, is the bank holding company for Virginia National Bank. The Bank has nine banking offices throughout Fauquier and Prince William counties, three banking offices in Charlottesville and Albemarle County, and banking offices in Winchester and Richmond, Virginia.  The Bank offers a full range of banking and related financial services to meet the needs of individuals, businesses and charitable organizations, including the fiduciary services of VNB Trust and Estate Services. The Company's common stock trades on the Nasdaq Capital Market under the symbol "VABK."  Additional information on the Company is also available at www.vnbcorp.com.

Non-GAAP Financial Measures

The accounting and reporting policies of the Company conform to U.S. generally accepted accounting principles ("GAAP") and prevailing practices in the banking industry. However, management uses certain non-GAAP measures to supplement the evaluation of the Company's performance. Management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company's core businesses. These non-GAAP disclosures should not be viewed as a substitute for, or more important than, operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of GAAP to non-GAAP measures are included at the end of this release.

Forward-Looking Statements; Other Information

Certain statements in this release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, without limitation, statements with respect to the Company's operations, performance, future strategy and goals, and are often characterized by use of qualified words such as "expect," "believe," "estimate," "project," "anticipate," "intend," "will," "should," or words of similar meaning or other statements concerning the opinions or judgement of the Company and its management about future events. While Company management believes such statements to be reasonable, future events and predictions are subject to circumstances that are not within the control of the Company and its management.  Actual results may differ materially from those included in the forward-looking statements due to a number of factors, including, without limitation, the effects of and changes in: inflation, interest rates, market and monetary fluctuations; liquidity and capital requirements; market disruptions including pandemics or significant health hazards, severe weather conditions, natural disasters, terrorist activities, financial crises, political crises, war and other military conflicts or other major events, the governmental and societal responses thereto, or the prospect of these events; changes, particularly declines, in general economic and market conditions in the local economies in which the Company operates, including the effects of declines in real estate values;  the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; the impact of changes in laws, regulations and guidance related to financial services  including, but not limited to, taxes, banking, securities and insurance; changes in accounting principles, policies and guidelines; the financial condition of the Company's borrowers; the Company's ability to attract, hire, train and retain qualified employees; an increase in unemployment levels; competitive pressures on loan and deposit pricing and demand; fluctuation in asset quality; assumptions that underlie the Company's ACL; the value of securities held in the Company's investment portfolio; performance of assets under management; cybersecurity threats or attacks and the development and maintenance of reliable electronic systems; changes in technology and their impact on the marketing of new products and services and the acceptance of these products and services by new and existing customers; the willingness of customers to substitute competitors' products and services for the Company's products and services; the risks and uncertainties described from time to time in the Company's press releases and filings with the SEC; and the Company's performance in managing the risks involved in any of the foregoing.  Many of these factors and additional risks and uncertainties are described in the Company's Annual Report on Form 10-K for the year ended December 31, 2023 and other reports filed from time to time by the Company with the Securities and Exchange Commission. These statements speak only as of the date made, and the Company does not undertake to update any forward-looking statements to reflect changes or events that may occur after this release.

VIRGINIA NATIONAL BANKSHARES CORPORATION CONSOLIDATED BALANCE SHEETS (dollars in thousands, except share and per share data)
	September 30, 2024				December 31, 2023*				September 30, 2023
	(Unaudited)								(Unaudited)
ASSETS
Cash and due from banks	$	10,188			$	18,074			$	7,416
Interest-bearing deposits in other banks		8,977				10,316				9,959
Federal funds sold		-				-				1,015
Securities:
Available for sale (AFS), at fair value		279,323				420,595				390,816
Restricted securities, at cost		7,737				8,385				7,269
Total securities		287,060				428,980				398,085
Loans, net of deferred fees and costs		1,215,512				1,092,665				1,020,518
Allowance for credit losses		(8,523)				(8,395)				(7,799)
Loans, net		1,206,989				1,084,270				1,012,719
Premises and equipment, net		15,562				16,195				16,298
Bank owned life insurance		39,762				38,904				38,635
Goodwill		7,768				7,768				7,768
Core deposit intangible, net		4,099				5,093				5,448
Right of use asset, net		5,921				6,748				7,110
Deferred tax asset, net		13,548				15,382				19,567
Accrued interest receivable and other assets		14,906				14,287				38,559
Total assets	$	1,614,780			$	1,646,017			$	1,562,579
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Demand deposits:
Noninterest-bearing	$	359,900			$	372,857			$	399,158
Interest-bearing		258,439				305,541				287,480
Money market and savings deposit accounts		431,707				412,119				406,189
Certificates of deposit and other time deposits		329,857				318,581				277,471
Total deposits		1,379,903				1,409,098				1,370,298
Federal funds purchased		3,112				3,462				-
Borrowings		52,500				66,500				43,000
Junior subordinated debt, net		3,495				3,459				3,448
Lease liability		5,748				6,504				6,824
Accrued interest payable and other liabilities		4,113				3,954				3,282
Total liabilities		1,448,871				1,492,977				1,426,852
Commitments and contingent liabilities
Shareholders' equity:
Preferred stock, $2.50 par value		-				-				-
Common stock, $2.50 par value		13,257				13,258				13,253
Capital surplus		106,166				106,045				105,862
Retained earnings		80,789				73,781				72,384
Accumulated other comprehensive loss		(34,303)				(40,044)				(55,772)
Total shareholders' equity		165,909				153,040				135,727
Total liabilities and shareholders' equity	$	1,614,780			$	1,646,017			$	1,562,579
Common shares outstanding		5,370,912				5,365,982				5,365,982
Common shares authorized		10,000,000				10,000,000				10,000,000
Preferred shares outstanding		-				-				-
Preferred shares authorized		2,000,000				2,000,000				2,000,000

 

*  Derived from audited consolidated financial statements

 

VIRGINIA NATIONAL BANKSHARES CORPORATION CONSOLIDATED STATEMENTS OF INCOME (dollars in thousands, except per share and share data) (Unaudited)
		For the three months ended								For the nine months ended
		September 30, 2024				September 30, 2023				September 30, 2024				September 30, 2023
Interest and dividend income:
Loans, including fees		$	17,378			$	13,748			$	49,281			$	41,409
Federal funds sold			136				133				535				143
Other interest-bearing deposits			50				64				165				442
Investment securities:
Taxable			1,414				2,848				5,349				8,674
Tax exempt			326				327				979				983
Dividends			102				94				320				265
Total interest and dividend income			19,406				17,214				56,629				51,916
Interest expense:
Demand deposits			66				78				205				273
Money market and savings deposits			2,990				2,739				8,864				6,709
Certificates and other time deposits			3,915				2,685				11,947				5,109
Borrowings			313				505				1,187				1,271
Federal funds purchased			9				21				25				112
Junior subordinated debt			89				86				260				226
Total interest expense			7,382				6,114				22,488				13,700
Net interest income			12,024				11,100				34,141				38,216
Recovery of credit losses			(114)				(73)				(474)				(60)
Net interest income after recovery of credit losses			12,138				11,173				34,615				38,276
Noninterest income:
Wealth management fees			239				419				905				1,220
Deposit account fees			317				404				1,042				1,204
Debit/credit card and ATM fees			474				535				1,485				1,742
Bank owned life insurance income			294				981				858				1,494
Gains (losses) on sales of assets, net			-				132				36				132
Gain on early redemption of debt			-				-				379				-
Gain on termination of interest rate swap			-				-				-				460
Losses on sales of AFS, net			-				-				(4)				(206)
Other			128				173				620				919
Total noninterest income			1,452				2,644				5,321				6,965
Noninterest expense:
Salaries and employee benefits			3,769				3,936				11,771				12,049
Net occupancy			919				991				2,756				3,099
Equipment			176				195				514				589
Bank franchise tax			366				292				1,051				929
Computer software			219				185				703				590
Data processing			707				623				2,025				2,171
FDIC deposit insurance assessment			125				220				500				540
Marketing, advertising and promotion			166				262				571				912
Professional fees			189				202				631				592
Core deposit intangible amortization			319				368				994				1,138
Other			988				1,066				3,368				3,156
Total noninterest expense			7,943				8,340				24,884				25,765
Income before income taxes			5,647				5,477				15,052				19,476
Provision for income taxes			1,047				824				2,647				3,381
Net income		$	4,600			$	4,653			$	12,405			$	16,095
Net income per common share, basic		$	0.86			$	0.87			$	2.31			$	3.00
Net income per common share, diluted		$	0.85			$	0.86			$	2.30			$	2.99
Weighted average common shares outstanding, basic			5,370,912				5,365,982				5,371,616				5,354,086
Weighted average common shares outstanding, diluted			5,396,936				5,395,483				5,387,537				5,382,145

 

VIRGINIA NATIONAL BANKSHARES CORPORATION FINANCIAL HIGHLIGHTS (dollars in thousands, except share and per share data) (Unaudited)
		At or For the Three Months Ended
		September 30, 2024				June 30, 2024				March 31, 2024				December 31, 2023				September 30, 2023
Common Share Data:
Net income		$	4,600			$	4,159			$	3,646			$	3,168			$	4,653
Net income per weighted average share, basic		$	0.86			$	0.77			$	0.68			$	0.59			$	0.87
Net income per weighted average share, diluted		$	0.85			$	0.77			$	0.68			$	0.59			$	0.86
Weighted average shares outstanding, basic			5,370,912				5,377,055				5,366,890				5,365,982				5,365,982
Weighted average shares outstanding, diluted			5,396,936				5,385,770				5,380,081				5,394,713				5,395,483
Actual shares outstanding			5,370,912				5,370,912				5,390,388				5,365,982				5,365,982
Tangible book value per share at period end (non-GAAP) 5		$	28.68			$	26.43			$	25.99			$	26.12			$	22.83
Key Ratios:
Return on average assets 1			1.15	%			1.05	%			0.91	%			0.79	%			1.18	%
Return on average equity 1			11.44	%			11.07	%			9.57	%			9.03	%			12.91	%
Net interest margin (FTE) 2			3.24	%			3.04	%			2.93	%			2.89	%			3.04	%
Efficiency ratio (FTE) 3			58.6	%			62.7	%			66.8	%			64.0	%			60.3	%
Loan-to-deposit ratio			88.1	%			84.3	%			78.8	%			77.5	%			74.5	%
Net Interest Income:
Net interest income		$	12,024			$	11,181			$	10,936			$	10,753			$	11,100
Net interest income (FTE) 2		$	12,111			$	11,268			$	11,023			$	10,839			$	11,187
Capital Ratios:
Tier 1 leverage ratio			11.81	%			11.47	%			11.24	%			11.13	%			11.26	%
Total risk-based capital ratio			18.88	%			18.64	%			18.49	%			18.24	%			18.76	%
Assets and Asset Quality:
Average earning assets		$	1,487,182			$	1,491,821			$	1,513,924			$	1,487,910			$	1,460,555
Average gross loans		$	1,181,447			$	1,144,350			$	1,117,570			$	1,061,297			$	986,480
Fair value mark on acquired loans		$	7,301			$	8,237			$	8,811			$	9,399			$	9,965
Allowance for credit losses on loans:
Beginning of period		$	8,028			$	8,289			$	8,395			$	7,799			$	7,863
Provision for (recovery of) credit losses			(3)				(518)				11				713				2
Charge-offs			(272)				(208)				(184)				(207)				(199)
Recoveries			770				465				67				90				133
Net recoveries (charge-offs)			498				257				(117)				(117)				(66)
End of period		$	8,523			$	8,028			$	8,289			$	8,395			$	7,799
Non-accrual loans		$	2,113			$	2,365			$	2,178			$	1,852			$	1,143
Loans 90 days or more past due and still accruing			3,214				1,596				876				880				854
Total nonperforming assets (NPA) 4		$	5,327			$	3,961			$	3,054			$	2,732			$	1,997
NPA as a % of total assets			0.33	%			0.25	%			0.19	%			0.17	%			0.13	%
NPA as a % of gross loans			0.44	%			0.34	%			0.27	%			0.25	%			0.20	%
ACL to gross loans			0.70	%			0.69	%			0.73	%			0.77	%			0.76	%
Non-accruing loans to gross loans			0.17	%			0.20	%			0.19	%			0.17	%			0.11	%
Net charge-offs (recoveries) to average loans 1			-0.17	%			-0.09	%			0.04	%			0.04	%			0.03	%

1	Ratio is computed on an annualized basis.
2	The net interest margin and net interest income are reported on a fully tax-equivalent basis (FTE) basis, using a Federal income tax rate of 21%.  This is a non-GAAP financial measure.  Refer to the Reconciliation of Certain Non-GAAP Financial (FTE) Measures at the end of this release.
3	The efficiency ratio (FTE) is computed as a percentage of noninterest expense divided by the sum of net interest income (FTE) and noninterest income. This is a non-GAAP financial measure that management believes provides investors with important information regarding operational efficiency. Management believes such financial information is meaningful to the reader in understanding operating performance, but cautions that such information should not be viewed as a substitute for GAAP.  Comparison of our efficiency ratio with those of other companies may not be possible because other companies may calculate them differently.  Refer to the Reconciliation of Certain Non-GAAP Financial (FTE) Measures at the end of this release.
4	The Bank held no other real estate owned during any of the periods presented.
5	This is a non-GAAP financial measure.  Refer to the Reconciliation of Certain Non-GAAP Financial (FTE) Measures at the end of this release.

 

VIRGINIA NATIONAL BANKSHARES CORPORATION AVERAGE BALANCES, INCOME AND EXPENSES, YIELDS AND RATES (TAXABLE EQUIVALENT BASIS) (dollars in thousands) (Unaudited)
		For the three months ended
		September 30, 2024												September 30, 2023
						Interest												Interest
		Average				Income/				Average				Average				Income/				Average
		Balance				Expense				Yield/Cost				Balance				Expense				Yield/Cost
ASSETS
Interest Earning Assets:
Securities:
Taxable Securities and Dividends		$	221,548			$	1,516				2.74	%		$	387,180			$	2,942				3.04	%
Tax Exempt Securities 1			66,334				413				2.49	%			66,835				414				2.48	%
Total Securities 1			287,882				1,929				2.68	%			454,015				3,356				2.96	%
Loans:
Real Estate			905,275				13,348				5.87	%			843,477				11,612				5.46	%
Commercial			238,407				3,418				5.70	%			103,059				1,394				5.37	%
Consumer			37,765				612				6.45	%			39,945				742				7.37	%
Total Loans			1,181,447				17,378				5.85	%			986,481				13,748				5.53	%
Fed Funds Sold			9,875				136				5.48	%			9,569				133				5.51	%
Other interest-bearing deposits			7,978				50				2.49	%			10,491				64				2.42	%
Total Earning Assets			1,487,182				19,493				5.21	%			1,460,556				17,301				4.70	%
Less: Allowance for Credit Losses			(8,134)												(7,907)
Total Non-Earning Assets			106,616												114,792
Total Assets		$	1,585,664											$	1,567,441
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest Bearing Liabilities:
Interest Bearing Deposits:
Interest Checking		$	261,961			$	66				0.10	%		$	304,969			$	78				0.10	%
Money Market and Savings Deposits			425,026				2,990				2.80	%			407,213				2,739				2.67	%
Time Deposits			334,768				3,915				4.65	%			252,917				2,685				4.21	%
Total Interest-Bearing Deposits			1,021,755				6,971				2.71	%			965,099				5,502				2.26	%
Borrowings			25,634				313				4.86	%			37,648				505				5.32	%
Federal funds purchased			616				9				5.81	%			1,300				21				6.41	%
Junior subordinated debt			3,487				89				10.15	%			3,443				86				9.91	%
Total Interest-Bearing Liabilities			1,051,492				7,382				2.79	%			1,007,490				6,114				2.41	%
Non-Interest-Bearing Liabilities:
Demand deposits			363,929												406,518
Other liabilities			10,347												10,422
Total Liabilities			1,425,768												1,424,430
Shareholders' Equity			159,896												143,011
Total Liabilities & Shareholders' Equity		$	1,585,664											$	1,567,441
Net Interest Income (FTE)						$	12,111											$	11,187
Interest Rate Spread 2											2.42	%											2.29	%
Cost of Funds											2.07	%											1.72	%
Interest Expense as a Percentage of      Average Earning Assets											1.97	%											1.66	%
Net Interest Margin (FTE) 3											3.24	%											3.04	%

1	Tax-exempt income for investment securities has been adjusted to a fully tax-equivalent basis (FTE), using a Federal income tax rate of 21%.
	Refer to the Reconcilement of Non-GAAP Measures table at the end of this release.
2	Interest spread is the average yield earned on earning assets less the average rate paid on interest-bearing liabilities.
3	Net interest margin (FTE) is net interest income expressed as a percentage of average earning assets.

 

VIRGINIA NATIONAL BANKSHARES CORPORATION AVERAGE BALANCES, INCOME AND EXPENSES, YIELDS AND RATES (TAXABLE EQUIVALENT BASIS) (dollars in thousands) (Unaudited)
		For the nine months ended
		September 30, 2024												September 30, 2023
						Interest												Interest
		Average				Income/				Average				Average				Income/				Average
		Balance				Expense				Yield/Cost				Balance				Expense				Yield/Cost
ASSETS
Interest Earning Assets:
Securities:
Taxable Securities and Dividends		$	262,029			$	5,669				2.88	%		$	418,367			$	8,939				2.85	%
Tax Exempt Securities 1			66,462				1,240				2.49	%			66,957				1,245				2.48	%
Total Securities 1			328,491				6,909				2.80	%			485,324				10,184				2.80	%
Loans:
Real Estate			903,786				38,373				5.67	%			827,902				36,077				5.83	%
Commercial			206,420				8,923				5.77	%			83,393				3,103				4.97	%
Consumer			37,706				1,985				7.03	%			42,094				2,229				7.08	%
Total Loans			1,147,912				49,281				5.73	%			953,389				41,409				5.81	%
Fed Funds Sold			13,101				535				5.45	%			3,527				143				5.42	%
Other interest-bearing deposits			8,002				165				2.75	%			17,444				442				3.39	%
Total Earning Assets			1,497,506				56,890				5.07	%			1,459,684				52,178				4.78	%
Less: Allowance for Credit Losses			(8,381)												(7,933)
Total Non-Earning Assets			109,762												114,387
Total Assets		$	1,598,887											$	1,566,138
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest Bearing Liabilities:
Interest Bearing Deposits:
Interest Checking		$	271,102			$	205				0.10	%		$	332,587			$	273				0.11	%
Money Market and Savings Deposits			419,586				8,864				2.82	%			423,547				6,709				2.12	%
Time Deposits			338,154				11,947				4.72	%			192,139				5,109				3.56	%
Total Interest-Bearing Deposits			1,028,842				21,016				2.73	%			948,273				12,091				1.70	%
Borrowings			32,706				1,187				4.85	%			33,289				1,271				5.10	%
Federal funds purchased			558				25				5.98	%			2,927				112				5.12	%
Junior subordinated debt			3,476				260				9.99	%			3,430				226				8.81	%
Total Interest-Bearing Liabilities			1,065,582				22,488				2.82	%			987,919				13,700				1.85	%
Non-Interest-Bearing Liabilities:
Demand deposits			367,688												428,906
Other liabilities			10,808												9,760
Total Liabilities			1,444,078												1,426,585
Shareholders' Equity			154,809												139,553
Total Liabilities & Shareholders' Equity		$	1,598,887											$	1,566,138
Net Interest Income (FTE)						$	34,402											$	38,478
Interest Rate Spread 2											2.25	%											2.93	%
Cost of Funds											2.10	%											1.29	%
Interest Expense as a Percentage of      Average Earning Assets											2.01	%											1.25	%
Net Interest Margin (FTE) 3											3.07	%											3.52	%

1	Tax-exempt income for investment securities has been adjusted to a fully tax-equivalent basis (FTE), using a Federal income tax rate of 21%.
	Refer to the Reconcilement of Non-GAAP Measures table at the end of this release.
2	Interest spread is the average yield earned on earning assets less the average rate paid on interest-bearing liabilities.
3	Net interest margin (FTE) is net interest income expressed as a percentage of average earning assets.

 

 

VIRGINIA NATIONAL BANKSHARES CORPORATION RECONCILIATION OF CERTAIN QUARTERLY NON-GAAP FINANCIAL MEASURES (dollars in thousands, except per share data) (Unaudited)
		For the Three Months Ended
		September 30, 2024				June 30, 2024				March 31, 2024				December 31, 2023				September 30, 2023
Fully tax-equivalent measures
Net interest income		$	12,024			$	11,181			$	10,936			$	10,753			$	11,100
Fully tax-equivalent adjustment			87				87				87				86				87
Net interest income (FTE) 1		$	12,111			$	11,268			$	11,023			$	10,839			$	11,187
Efficiency ratio 2			58.9	%			63.1	%			67.2	%			64.4	%			60.7	%
Fully tax-equivalent adjustment			-0.3	%			-0.4	%			-0.4	%			-0.4	%			-0.4	%
Efficiency ratio (FTE) 3			58.6	%			62.7	%			66.8	%			64.0	%			60.3	%
Net interest margin			3.22	%			3.01	%			2.91	%			2.87	%			3.02	%
Fully tax-equivalent adjustment			0.02	%			0.03	%			0.02	%			0.02	%			0.02	%
Net interest margin (FTE) 1			3.24	%			3.04	%			2.93	%			2.89	%			3.04	%
		As of
		September 30, 2024				June 30, 2024				March 31, 2024				December 31, 2023				September 30, 2023
Other financial measures
Book value per share		$	30.89			$	28.70			$	28.31			$	28.52			$	25.29
Impact of intangible assets 4			(2.21)				(2.27)				(2.32)				(2.40)				(2.46)
Tangible book value per share (non-GAAP)		$	28.68			$	26.43			$	25.99			$	26.12			$	22.83

 

		For the Nine Months Ended
		September 30, 2024				September 30, 2023
Fully tax-equivalent measures
Net interest income		$	34,141			$	38,216
Fully tax-equivalent adjustment			261				262
Net interest income (FTE) 1		$	34,402			$	38,478
Efficiency ratio 2			63.1	%			57.0	%
Fully tax-equivalent adjustment			-0.5	%			-0.3	%
Efficiency ratio (FTE) 3			62.6	%			56.7	%
Net interest margin			3.05	%			3.50	%
Fully tax-equivalent adjustment			0.02	%			0.02	%
Net interest margin (FTE) 1			3.07	%			3.52	%

1	FTE calculations use a Federal income tax rate of 21%.
2	The efficiency ratio, GAAP basis, is computed by dividing noninterest expense by the sum of net interest income and noninterest income.
3	The efficiency ratio, FTE, is computed by dividing noninterest expense by the sum of net interest income (FTE) and noninterest income.
4	Intangible assets include goodwill and core deposit intangible assets, net of accumulated amortization, for all periods presented.

 

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SOURCE Virginia National Bankshares Corporation

FAQ

What was VABK's net income for Q3 2024?

Virginia National Bankshares (VABK) reported net income of $4.6 million, or $0.85 per diluted share, for the third quarter of 2024.

How much did VABK's loan portfolio grow in 2024?

VABK's loan portfolio grew by 11% during 2024 and 19% year-over-year as of September 30, 2024.

What was VABK's net interest margin in Q3 2024?

VABK's net interest margin improved to 3.24% in the third quarter of 2024, up from 3.04% in the second quarter of 2024.

How did VABK's book value per share change year-over-year?

VABK's book value per share increased to $30.89 as of September 30, 2024, compared to $25.29 as of September 30, 2023.

What was VABK's efficiency ratio in Q3 2024?

VABK's efficiency ratio improved to 58.6% in the third quarter of 2024, down from 62.7% in the second quarter of 2024.