American National Bankshares Reports Fourth Quarter and Full Year 2020 Earnings

DANVILLE, Va., Jan. 21, 2021 (GLOBE NEWSWIRE) -- American National Bankshares Inc. (NASDAQ: AMNB) (“American National” or the “Company”) today reported fourth quarter 2020 earnings of $8.8 million, or $0.80 per diluted common share. Those results compare to $7.4 million, or $0.67 per diluted common share, during the same quarter in the prior year, and net income of $7.2 million, or $0.66 per diluted common share, recognized for the third quarter of 2020. Earnings for the twelve months ended December 31, 2020 were $30.0 million, or $2.73 per diluted common share, compared to $20.9 million, or $1.98 per diluted common share for the same period of 2019. Earnings for the twelve months ended December 31, 2019 were impacted by $11.8 million in merger related expenses.

President and Chief Executive Officer Jeffrey V. Haley commented, “Despite the significant economic impact of COVID-19, we ended 2020 on a positive note, with earnings of $8.8 million or $0.80 per share for the fourth quarter, representing an increase of $1.4 million, or 18.2%, as compared to same quarter in 2019. Annual revenues were just over $100 million or 9% growth as compared to 2019. For the year, we generated earnings of $30.0 million or 43.7% growth as compared to 2019 despite increasing our allowance for loan losses by $8.3 million as a result of the pandemic. Tangible book value increased to $22.47 per share, reflecting growth of $1.83 per share, or 8.9%, as compared to 2019. Capital and liquidity levels remain very strong.”

“We are excited about 2021 and our plans to improve our digital capabilities and deepen our customer relationships. I want to again express my appreciation to our employees and customers, who continue to adapt to the many challenges of the pandemic. It has been inspirational to witness our team’s ability to meet our customer and community needs during these challenging times.”

Fourth quarter 2020 highlights include:

  • Earnings produced a return on average tangible common equity of 14.90% for the fourth quarter of 2020, compared to 12.66% in the previous quarter and 13.71% for the same quarter in the prior year (non-GAAP).

  • Average deposits grew 4.2% during the quarter and 22.7% over the same quarter of 2019; the cost of deposits decreased to 0.43% in the fourth quarter, compared to 0.52% in the previous quarter and 0.95% in the same quarter of the prior year.

  • Net interest margin was 3.22% for the quarter, down from 3.26% in the third quarter of 2020 and from 3.62% in the same quarter of the prior year (non-GAAP).

  • Noninterest revenues decreased $71 thousand, or 1.7%, when compared to the previous quarter, and increased $355 thousand, or 9.2%, compared to the same quarter in the prior year.

  • Noninterest expense increased $519 thousand, or 3.7%, when compared to the previous quarter, and decreased $378 thousand, or 2.5%, when compared to the same quarter in the prior year.

  • The fourth quarter provision for loan losses totaled $585 thousand, which compares to a provision of $2.6 million for the previous quarter, and a provision of $462 thousand in the same quarter in the prior year. The allowance for loan losses as a percentage of loans held for investment increased to 1.06% at period end. Excluding Paycheck Protection Program (“PPP”) loans, the allowance as a percentage of loans increased to 1.19% at period end.

  • Nonperforming assets as a percentage of total assets were 0.12% at December 31, 2020, down from 0.16% at September 30, 2020 and 0.15% at December 31, 2019.

  • Annualized net charge-offs were 0.05% for the fourth quarter of 2020, up from 0.02% for the corresponding quarter in the prior year and 0.01% for the third quarter of 2020.

  • As a result of the Company’s participation in the Small Business Administration’s PPP under the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act, it had outstanding net PPP loans of $211.3 million at December 31, 2020, which compares to $266.0 million at September 30, 2020. The Company had net unamortized PPP loan origination fees with a balance of $4.4 million at December 31, 2020, which compares to $6.8 million at September 30, 2020.

NET INTEREST INCOME

Net interest income for the fourth quarter of 2020 was $22.1 million, an increase of $651 thousand, or 3.0%, from the prior quarter and an increase of $1.7 million, or 8.3%, from the fourth quarter of 2019. The fully taxable equivalent (“FTE”) net interest margin for the quarter was 3.22%, down from 3.26% in the prior quarter and down from 3.62% in the same period a year ago (non-GAAP). The fourth quarter of 2020 benefited from the recognition of the remaining net fees on PPP loans that were repaid during the quarter. Total PPP fees recognized in net interest income during the quarter was $2.4 million, an increase of $1.3 million as compared to the prior quarter as a result of the forgiveness of $56.4 million of PPP loans. The increase in net interest income from the same quarter in the prior year was attributable to the PPP program and core deposit growth partially offset by a significantly lower rate environment.

The Company’s FTE net interest margin includes the impact of acquisition accounting fair value adjustments. During the fourth quarter of 2020, net accretion related to acquisition accounting amounted to $1.2 million compared to $1.1 million for the same period in 2019 and $1.7 million in the prior quarter. The third quarter of 2020 included an $800,000 cash basis accretion collection from a loan charged off prior to an American National acquisition. Net accretion for the twelve months ended December 31, 2020 amounted to $3.8 million, compared to $3.4 million for the same period in 2019. Estimated remaining net accretion from acquisitions for the periods indicated is as follows (dollars in thousands):

2021$1,830
2022 1,146
2023 646
2024 388
2025 281
Thereafter 956

ASSET QUALITY

Nonperforming assets (“NPAs”) totaled $3.7 million as of December 31, 2020, down from $4.6 million at September 30, 2020, and up slightly from $3.6 million at December 31, 2019. NPAs as a percentage of total assets were 0.12% at December 31, 2020, compared to 0.16% at September 30, 2020 and 0.15% at December 31, 2019.

The provision for loan losses was $585 thousand for the fourth quarter of 2020, as compared to $2.6 million for the previous quarter and $462 thousand for the same period in the previous year. The fourth quarter of 2020 warranted a significantly lower provision than third quarter based on the economic outlook, ongoing low charge-off and delinquency rates, and overall strong asset quality metrics. The allowance for loan losses was $21.4 million at December 31, 2020, compared to $21.1 million at September 30, 2020 and $13.2 million at December 31, 2019. Annualized net charge-offs as a percentage of average loans outstanding was 0.05% for the fourth quarter of 2020, compared to 0.01% in the previous quarter and 0.02% for the same period in the prior year. The allowance as a percentage of loans held for investment was 1.06% at December 31, 2020, compared to 1.01% at September 30, 2020, and 0.72% at December 31, 2019. Excluding PPP loans, the allowance as a percentage of loans increased to 1.19% at December 31, 2020, compared to 1.16% at September 30, 2020 and 0.72% at December 31, 2019.

American National continues to utilize a Disaster Assistance Program for borrowers in accordance with Section 4013 of the CARES Act. At December 31, 2020, American National had interest only and payment deferrals to customers with outstanding balances amounting to $30.0 million, representing 1.5% of total loans held for investment, which compares to $135.2 million, or 6.5% of outstanding loans held for investment, at September 30, 2020. At December 31, 2020, $18.2 million of the $30.0 million in total deferrals were the result of second and third payment or interest deferrals, representing less than 1% of total loans held for investment.

NONINTEREST INCOME

Noninterest income decreased $71 thousand, or 1.7%, to $4.2 million for the quarter ended December 31, 2020 from $4.3 million in the prior quarter and increased $355 thousand, or 9.2%, from the same period in the prior year. The largest increase in the quarter was the increase in income from small business investment companies (“SBICs”) which was up $138 thousand, or 140.8%, over the previous quarter. The primary decrease in the quarter related to reduced earnings in other investments of the Company. Comparing the fourth quarter of 2020 to the fourth quarter of 2019, the increase was reflective of increased mortgage banking income, income from SBICs and reduced losses on premises and equipment. Other noninterest income for the fourth quarter of 2020 was reduced by a loss on the sale of repossessed assets of $139 thousand.

NONINTEREST EXPENSE

Noninterest expense for the fourth quarter of 2020 amounted to $14.7 million, up $519 thousand, or 3.7%, when compared to the $14.1 million for the previous quarter and down $378 thousand, or 2.5%, from $15.0 million during the same period in the previous year. The increase from the third quarter of 2020 was primarily attributable to increased pension and salary expenses resulting from voluntary early retirement package costs. The fourth quarter of 2019 included $460,000 of merger related expenses.

INCOME TAXES

The effective tax rate for the three months ended December 31, 2020 was 20.9%, compared to 20.0% for the prior quarter and 15.6% for the same period in the prior year.

BALANCE SHEET

Total assets at December 31, 2020 were $3.1 billion, an increase of $146.7 million from September 30, 2020 and $571.5 million from the same quarter one year ago. The growth over the previous quarter was attributable to core deposit growth and related growth in cash and investments. The growth over the same period a year ago is primarily due to loan and deposit growth associated with the PPP program and growth in core deposits during the period.

At December 31, 2020, loans held for investment (net of deferred fees and costs) were $2.0 billion, a decrease of $71.0 million, or 13.6%, annualized from September 30, 2020. Of this decrease, approximately $56.4 million was associated with PPP loan forgiveness. Loans held for investment increased $184.2 million, or 10.1%, from December 31, 2019. Excluding PPP loans, loans held for investment were slightly lower year over year.

Deposits amounted to $2.6 billion at December 31, 2020, with growth of $140.6 million, or 22.8%, annualized from September 30, 2020 and $550.8 million, or 26.7%, compared to the same quarter of 2019. The growth over the prior quarter and prior period of 2019 is a result of continued higher than average cash balances being maintained by customers as the uncertainty of the pandemic continues. This pattern has been prevalent through the second, third and fourth quarters of 2020 and is consistent with trends for all commercial banks.

The Company continues to be well-capitalized as defined by regulators, with tangible common equity to tangible assets of 8.34% at December 31, 2020 as compared to 8.55% at September 30, 2020 and 9.57% at December 31, 2019.

ABOUT AMERICAN NATIONAL

American National is a multi-state bank holding company with total assets of approximately $3.1 billion. Headquartered in Danville, Virginia, American National is the parent company of American National Bank and Trust Company. American National Bank is a community bank serving Virginia and North Carolina with 26 banking offices. American National Bank also manages an additional $976 million of trust, investment and brokerage assets in its Wealth Division. Additional information about American National and American National Bank is available on American National's website at www.amnb.com.

NON-GAAP FINANCIAL MEASURES

This release contains financial information determined by methods other than in accordance with generally accepted accounting principles in the United States (“GAAP”). American National’s management uses these non-GAAP financial measures in its analysis of American National’s performance. These measures typically adjust GAAP performance measures to exclude the effects of the amortization of intangibles and include the tax benefit associated with revenue items that are tax-exempt, as well as adjust income available to common shareholders for certain significant activities or transactions that are infrequent in nature. 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 American National’s core businesses. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. For a reconciliation of non-GAAP financial measures, see “Reconciliation of Non-GAAP Financial Measures” at the end of this release.

FORWARD-LOOKING STATEMENTS

Statements made in this release, other than those concerning historical financial information, may be considered forward-looking statements, which speak only as of the date of this release and are based on current expectations and involve a number of assumptions. American National intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and is including this statement for purposes of these safe harbor provisions. American National’s ability to predict results, or the actual effect of future plans or strategies, is inherently uncertain. Factors that could have a material effect on the operations and future prospects of American National include but are not limited to: (1) the impacts of the ongoing COVID-19 pandemic; (2) expected revenue synergies and cost savings from acquisitions and depositions; (3) changes in interest rates, general economic conditions, legislation and regulation, and monetary and fiscal policies of the U.S. government, including policies of the U.S. Treasury, Office of the Comptroller of the Currency and the Board of Governors of the Federal Reserve System; (4) the quality and composition of the loan and securities portfolios, demand for loan products, deposit flows, competition, and demand for financial services in American National’s market areas; (5) the implementation of new technologies, and the ability to develop and maintain secure and reliable electronic systems; (6) accounting principles, policies, and guidelines; and (7) other risk factors detailed from time to time in filings made by American National with the Securities and Exchange Commission. American National undertakes no obligation to update or clarify these forward-looking statements, whether as a result of new information, future events or otherwise.



American National Bankshares Inc.
Consolidated Balance Sheets
(Dollars in thousands, except per share data)
Unaudited
     
  December 31
   2020   2019 
Assets    
Cash and due from banks $30,767  $32,505 
Interest-bearing deposits in other banks  343,603   47,077 
Securities available for sale, at fair value  466,091   379,195 
Restricted stock, at cost  8,715   8,630 
Loans held for sale  15,591   2,027 
Loans, net of deferred fees and costs  2,015,056   1,830,815 
  Less allowance for loan losses  (21,403)  (13,152)
      Net Loans  1,993,653   1,817,663 
Premises and equipment, net  39,723   39,848 
Other real estate owned, net  958   1,308 
Goodwill  85,048   84,002 
Core deposit intangibles, net  6,091   7,728 
Bank owned life insurance  28,482   27,817 
Other assets  31,288   30,750 
     
      Total assets $3,050,010  $2,478,550 
     
     
Liabilities    
   Demand deposits -- noninterest-bearing $830,094  $578,606 
   Demand deposits -- interest-bearing  501,283   328,015 
   Money market deposits  666,122   504,651 
   Savings deposits  217,405   177,505 
   Time deposits  396,426   471,770 
      Total deposits  2,611,330   2,060,547 
   Customer repurchase agreements  42,551   40,475 
   Long-term borrowings  35,630   35,546 
   Other liabilities  22,605   21,724 
      Total liabilities  2,712,116   2,158,292 
     
Shareholders' equity    
   Preferred stock, $5 par value, 2,000,000 shares authorized,   
       none outstanding  -   - 
   Common stock, $1 par value, 20,000,000 shares authorized,   
      10,982,367 shares outstanding at December 31, 2020 and   
      11,071,540 shares outstanding at December 31, 2019  10,926   11,019 
   Capital in excess of par value  154,850   158,244 
   Retained earnings  169,681   151,478 
   Accumulated other comprehensive income (loss), net  2,437   (483)
      Total shareholders' equity  337,894   320,258 
     
      Total liabilities and shareholders' equity $3,050,010  $2,478,550 
     



American National Bankshares Inc.
Consolidated Statements of Income
(Dollars in thousands, except per share data)
Unaudited
         
  Three Months Ended Twelve Months Ended
  December 31 December 31
   2020   2019   2020   2019 
 Interest and Dividend Income:        
   Interest and fees on loans $22,654  $21,947  $87,700  $82,684 
   Interest and dividends on securities:        
     Taxable  1,536   1,991   6,764   7,682 
     Tax-exempt  103   117   433   777 
     Dividends  121   127   503   451 
   Other interest income  84   408   440   1,261 
       Total interest and dividend income  24,498   24,590   95,840   92,855 
         
 Interest Expense:        
   Interest on deposits  1,821   3,496   9,729   13,143 
   Interest on short-term borrowings  22   134   259   650 
   Interest on long-term borrowings  509   512   2,032   1,935 
      Total interest expense  2,352   4,142   12,020   15,728 
         
Net Interest Income  22,146   20,448   83,820   77,127 
   Provision for loan losses  585   462   8,916   456 
         
Net Interest Income After Provision        
   for Loan Losses  21,561   19,986   74,904   76,671 
         
Noninterest Income:        
   Trust fees  1,025   1,021   4,044   3,847 
   Service charges on deposit accounts  677   765   2,557   2,866 
   Other fees and commissions  1,037   967   3,925   3,693 
   Mortgage banking income  1,042   737   3,514   2,439 
   Securities gains, net  -   32   814   607 
   Brokerage fees  192   205   745   721 
   Income from Small Business Investment Companies  236   37   270   211 
   Losses on premises and equipment, net  (13)  (338)  (110)  (427)
   Other  25   440   1,084   1,213 
      Total noninterest income  4,221   3,866   16,843   15,170 
         
Noninterest Expense:        
   Salaries and employee benefits  8,225   7,986   29,765   30,015 
   Occupancy and equipment  1,470   1,454   5,586   5,417 
   FDIC assessment  206   -   639   119 
   Bank franchise tax  425   531   1,702   1,644 
   Core deposit intangible amortization  391   437   1,637   1,398 
   Data processing  764   729   3,017   2,567 
   Software  342   363   1,454   1,295 
   Other real estate owned, net  26   15   60   31 
   Merger related expenses  -   460   -   11,782 
   Other  2,810   3,062   10,705   11,806 
      Total noninterest expense  14,659   15,037   54,565   66,074 
         
 Income Before Income Taxes  11,123   8,815   37,182   25,767 
 Income Taxes  2,329   1,374   7,137   4,861 
Net Income $8,794  $7,441  $30,045  $20,906 
         
Net Income Per Common Share:         
    Basic $0.80  $0.67  $2.74  $1.99 
    Diluted $0.80  $0.67  $2.73  $1.98 
Weighted Average Common Shares Outstanding:        
    Basic  10,975,349   11,094,346   10,981,623   10,531,572 
    Diluted  10,978,931   11,103,905   10,985,790   10,541,337 
         



American National Bankshares Inc.          
Financial Highlights          
Unaudited            
              
 (Dollars in thousands, except per share data)     At or for the Year Ended  
    4th Qtr 3rd Qtr 4th Qtr December 31,  
     2020   2020   2019   2020   2019  
EARNINGS           
      Interest income$ 24,498  $24,179  $24,590  $ 95,840  $92,855  
      Interest expense 2,352   2,684   4,142   12,020   15,728  
      Net interest income 22,146   21,495   20,448   83,820   77,127  
      Provision for loan losses 585   2,619   462   8,916   456  
      Noninterest income 4,221   4,292   3,866   16,843   15,170  
      Noninterest expense 14,659   14,140   15,037   54,565   66,074  
      Income taxes  2,329   1,801   1,374   7,137   4,861  
      Net income  8,794   7,227   7,441   30,045   20,906  
              
PER COMMON SHARE           
      Net income per share - basic$ 0.80  $0.66  $0.67  $ 2.74  $1.99  
      Net income per share - diluted 0.80   0.66   0.67   2.73   1.98  
      Cash dividends paid 0.27   0.27   0.27   1.08   1.04  
      Book value per share 30.77   30.26   28.93   30.77   28.93  
      Book value per share - tangible (a) 22.47   21.92   20.64   22.47   20.64  
      Closing market price 26.21   20.92   39.57   26.21   39.57  
              
FINANCIAL RATIOS          
      Return on average assets 1.18 % 1.01 % 1.20 % 1.08 % 0.91 %
      Return on average equity 10.48   8.76   9.31   9.12   7.16  
      Return on average tangible equity (a) 14.90   12.66   13.71   13.19   10.43  
      Average equity to average assets 11.30   11.50   12.88   11.88   12.68  
      Tangible equity to tangible assets (a) 8.34   8.55   9.57   8.34   9.57  
      Net interest margin, taxable equivalent 3.22   3.26   3.62   3.30   3.68  
      Efficiency ratio (a) 53.92   53.00   57.24   52.80   57.25  
      Effective tax rate 20.94   19.95   15.59   19.19   18.87  
              
PERIOD-END BALANCES          
      Securities $ 474,806  $367,200  $387,825  $ 474,806  $387,825  
      Loans held for sale 15,591   6,789   2,027   15,591   2,027  
      Loans, net  2,015,056   2,086,094   1,830,815   2,015,056   1,830,815  
      Goodwill and other intangibles 91,139   91,530   91,730   91,139   91,730  
      Assets   3,050,010   2,903,304   2,478,550   3,050,010   2,478,550  
      Assets - tangible (a) 2,958,871   2,811,774   2,386,820   2,958,871   2,386,820  
      Deposits  2,611,330   2,470,700   2,060,547   2,611,330   2,060,547  
      Customer repurchase agreements 42,551   41,906   40,475   42,551   40,475  
      Long-term borrowings 35,630   35,609   35,546   35,630   35,546  
      Shareholders' equity 337,894   331,981   320,258   337,894   320,258  
      Shareholders' equity - tangible (a) 246,755   240,451   228,528   246,755   228,528  
              
AVERAGE BALANCES          
      Securities (b) $ 372,529  $333,778  $347,502  $ 347,952  $342,219  
      Loans held for sale 8,601   9,943   4,991   6,578   3,419  
      Loans, net  2,063,397   2,092,412   1,810,744   2,008,683   1,700,880  
      Interest-earning assets 2,754,455   2,648,990   2,264,687   2,551,913   2,107,169  
      Goodwill and other intangibles 91,358   91,749   92,607   91,751   81,049  
      Assets   2,971,505   2,870,213   2,482,502   2,773,007   2,303,624  
      Assets - tangible (a) 2,880,147   2,778,464   2,389,895   2,681,256   2,222,575  
      Interest-bearing deposits 1,701,395   1,619,960   1,466,116   1,595,694   1,377,422  
      Deposits  2,536,363   2,434,645   2,066,435   2,342,353   1,915,197  
      Customer repurchase agreements 40,819   45,689   38,742   42,937   39,134  
      Other short-term borrowings -   -   -   1   2,694  
      Long-term borrowings 35,617   35,597   35,537   35,586   33,644  
      Shareholders' equity 335,671   330,038   319,851   329,353   292,022  
      Shareholders' equity - tangible (a) 244,313   238,289   227,244   237,602   210,973  
              
American National Bankshares Inc.          
Financial Highlights          
Unaudited            
              
 (Dollars in thousands, except per share data)     At or for the Year Ended  
    4th Qtr 3rd Qtr 4th Qtr December 31,  
     2020   2020   2019   2020   2019  
CAPITAL             
      Weighted average shares outstanding - basic    10,975,349   10,966,645   11,094,346   10,981,623   10,531,572  
      Weighted average shares outstanding - diluted    10,978,931   10,969,901   11,103,905   10,985,790   10,541,337  
              
ALLOWANCE FOR LOAN LOSSES          
      Beginning balance$ 21,088  $18,507  $12,758  $ 13,152  $12,805  
      Provision for loan losses 585   2,619   462   8,916   456  
      Charge-offs  (331)  (126)  (144)  (1,006)  (333) 
      Recoveries  61   88   76   341   224  
      Ending balance$ 21,403  $21,088  $13,152  $ 21,403  $13,152  
              
LOANS            
      Construction and land development$ 140,071  $151,613  $137,920  $ 140,071  $137,920  
      Commercial real estate - owner occupied 373,680   382,121   360,991   373,680   360,991  
      Commercial real estate - non-owner occupied    627,569   608,954   538,208   627,569   538,208  
      Residential real estate 269,137   279,815   324,315   269,137   324,315  
      Home equity  104,881   111,448   119,423   104,881   119,423  
      Commercial and industrial 491,256   543,746   339,077   491,256   339,077  
      Consumer  8,462   8,397   10,881   8,462   10,881  
      Total  $ 2,015,056  $2,086,094  $1,830,815  $ 2,015,056  $1,830,815  
              
NONPERFORMING ASSETS AT PERIOD-END         
      Nonperforming loans:          
          90 days past due and accruing$ 262  $285  $361  $ 262  $361  
          Nonaccrual  2,434   3,088   1,944   2,434   1,944  
      Other real estate owned and repossessions    958   1,210   1,308   958   1,308  
      Nonperforming assets$ 3,654  $4,583  $3,613  $ 3,654  $3,613  
              
ASSET QUALITY RATIOS          
      Allowance for loan losses to total loans 1.06 % 1.01 % 0.72 % 1.06 % 0.72 %
      Allowance for loan losses to          
         nonperforming loans 793.88   625.20   570.59   793.88   570.59  
      Nonperforming assets to total assets 0.12   0.16   0.15   0.12   0.15  
      Nonperforming loans to total loans 0.13   0.16   0.13   0.13   0.13  
      Annualized net charge-offs          
         to average loans 0.05   0.01   0.02   0.03   0.01  
              
              
OTHER DATA           
      Fiduciary assets at period-end (c) (d)$ 614,016  $569,095  $560,776  $ 614,016  $560,776  
      Retail brokerage assets at period-end (c) (d)   $ 362,022  $314,809  $317,262  $ 362,022  $317,262  
      Number full-time equivalent employees (e) 342   341   355   342   355  
      Number of full service offices 26   25   26   26   26  
      Number of loan production offices 1   1   1   1   1  
      Number of ATMs 37   37   38   37   38  
              
              
Notes:            
              
      (a) - This financial measure is not calculated in accordance with GAAP. For a reconciliation of
      non-GAAP financial measures, see "Reconciliation of Non-GAAP Financial Measures" at the end
      of this release.
      (b) - Average does not include unrealized gains and losses.
      (c) - Market value.
      (d) - Assets are not owned by American National and are not reflected in the consolidated balance   
      sheet.            
      (e) - Average for quarter.          
              



   Net Interest Income Analysis
   For the Three Months Ended December 31, 2020 and 2019
   (Dollars in thousands)
   Unaudited
                
        Interest     
    Average Balance Income/Expense (a) Yield/Rate 
                
     2020  2019  2020  2019 2020 2019 
Loans:             
 Commercial$507,750 $315,902 $5,354 $3,516 4.19%4.42%
 Real estate 1,556,192  1,488,577  17,206  18,268 4.42 4.91 
 Consumer 8,056  11,256  137  209 6.77 7.37 
  Total loans (b) 2,071,998  1,815,735  22,697  21,993 4.38 4.84 
                
Securities:            
 U.S. Treasury 14,126  -  4  - 0.11 - 
 Federal agencies & GSEs 76,606  123,950  276  716 1.44 2.31 
 Mortgage-backed & CMOs 206,817  164,727  916  996 1.77 2.42 
 State and municipal 53,257  41,109  304  303 2.28 2.95 
 Other 21,723  17,716  286  250 5.27 5.64 
  Total securities 372,529  347,502  1,786  2,265 1.92 2.61 
                
Deposits in other banks 309,928  101,450  84  408 0.11 1.60 
                
 Total interest-earning assets 2,754,455  2,264,687  24,567  24,666 3.56 4.35 
                
Non-earning assets 217,050  217,815         
                
  Total assets$2,971,505 $2,482,502         
                
Deposits:            
 Demand$433,356 $329,759  50  126 0.05 0.15 
 Money market 647,320  482,671  380  1,283 0.23 1.05 
 Savings 215,233  176,686  16  83 0.03 0.19 
 Time  405,486  477,000  1,375  2,004 1.35 1.67 
  Total deposits 1,701,395  1,466,116  1,821  3,496 0.43 0.95 
                
Customer repurchase agreements    40,819  38,742  22  134 0.21 1.37 
Long-term borrowings 35,617  35,537  509  512 5.72 5.76 
 Total interest-bearing            
  liabilities 1,777,831  1,540,395  2,352  4,142 0.53 1.07 
                
Noninterest bearing demand deposits    834,968  600,319         
Other liabilities 23,035  21,937         
Shareholders' equity 335,671  319,851         
  Total liabilities and            
   shareholders' equity$2,971,505 $2,482,502         
                
Interest rate spread        3.03%3.28%
Net interest margin        3.22%3.62%
                
Net interest income (taxable equivalent basis)    22,215  20,524     
Less: Taxable equivalent adjustment (c)    69  76     
Net interest income    $22,146 $20,448     
                
                
Notes:             
                
      (a) - Interest income includes net accretion/amortization of acquired loan fair value adjustments and the net accretion/ 
             amortization of deferred loan fees and costs. 
      (b) - Nonaccrual loans are included in the average balances. 
      (c) - A tax rate of 21% was used in adjusting interest on tax-exempt assets to a fully taxable equivalent basis. 



   Net Interest Income Analysis
   For the Years Ended December 31, 2020 and 2019
   (Dollars in thousands)
   Unaudited
                
        Interest     
    Average Balance Income/Expense (a) Yield/Rate 
                
     2020  2019  2020  2019 2020 2019 
Loans:             
 Commercial$475,068 $306,065 $17,768 $14,1253.74%4.62%
 Real estate 1,531,195  1,388,188  69,525  68,050 4.54 4.90 
 Consumer 8,998  10,046  588  694 6.53 6.91 
  Total loans (b) 2,015,261  1,704,299  87,881  82,869 4.36 4.86 
                
Securities:            
 U.S. Treasury 9,010  -  51  - 0.57 - 
 Federal agencies & GSEs 72,112  132,916  1,423  3,191 1.97 2.40 
 Mortgage-backed & CMOs 200,612  134,458  4,060  3,350 2.02 2.49 
 State and municipal 45,836  58,293  1,175  1,650 2.56 2.83 
 Other 20,382  16,552  1,098  903 5.39 5.46 
  Total securities 347,952  342,219  7,807  9,094 2.24 2.66 
                
Deposits in other banks 188,700  60,651  440  1,261 0.23 2.08 
                
 Total interest-earning assets 2,551,913  2,107,169  96,128  93,224 3.77 4.42 
                
Non-earning assets 221,094  196,455         
                
  Total assets$2,773,007 $2,303,624         
                
Deposits:            
 Demand$386,790 $307,329  344  370 0.09 0.12 
 Money market 574,510  445,505  2,634  5,246 0.46 1.18 
 Savings 198,313  166,842  117  284 0.06 0.17 
 Time  436,081  457,746  6,634  7,243 1.52 1.58 
  Total deposits 1,595,694  1,377,422  9,729  13,143 0.61 0.95 
                
Customer repurchase agreements    42,937  39,134  259  596 0.60 1.52 
Other short-term borrowings 1  2,694  -  54 0.55 2.00 
Long-term borrowings 35,586  33,644  2,032  1,935 5.71 5.75 
 Total interest-bearing            
  liabilities 1,674,218  1,452,894  12,020  15,728 0.72 1.08 
                
Noninterest bearing demand deposits    746,659  537,775         
Other liabilities 22,777  20,933         
Shareholders' equity 329,353  292,022         
  Total liabilities and            
   shareholders' equity$2,773,007 $2,303,624         
                
Interest rate spread        3.05%3.34%
Net interest margin        3.30%3.68%
                
Net interest income (taxable equivalent basis)    84,108  77,496     
Less: Taxable equivalent adjustment (c)    288  369     
Net interest income    $83,820 $77,127     
                
                
Notes:             
                
      (a) - Interest income includes net accretion/amortization of acquired loan fair value adjustments and the net accretion/ 
             amortization of deferred loan fees and costs. 
      (b) - Nonaccrual loans are included in the average balances. 
      (c) - A tax rate of 21% was used in adjusting interest on tax-exempt assets to a fully taxable equivalent basis. 



American National Bankshares Inc.          
Reconciliation of Non-GAAP Financial Measures         
Unaudited            
              
 (Dollars in thousands, except per share data)     At or for the Year Ended  
    4th Qtr 3rd Qtr 4th Qtr December 31,  
     2020   2020   2019   2020   2019  
EFFICIENCY RATIO          
      Noninterest expense$ 14,659  $14,140  $15,037  $ 54,565  $66,074  
      Add/subtract: gain/loss on sale of OREO (8)  (23)  (3)  4   52  
      Subtract: core deposit intangible amortization    (391)  (402)  (437)  (1,637)  (1,398) 
      Subtract: merger related expenses -   -   (460)  -   (11,782) 
    $ 14,260  $13,715  $14,137  $ 52,932  $52,946  
              
      Net interest income$ 22,146  $21,495  $20,448  $ 83,820  $77,127  
      Tax equivalent adjustment 69   75   76   288   369  
      Noninterest income 4,221   4,292   3,866   16,843   15,170  
      Subtract: gain on securities -   -   (32)  (814)  (607) 
      Add: loss on fixed assets 13   15   338   110   427  
    $ 26,449  $25,877  $24,696  $ 100,247  $92,486  
              
      Efficiency ratio  53.92 % 53.00 % 57.24 % 52.80 % 57.25 %
              
TAX EQUIVALENT NET INTEREST INCOME         
      Non-GAAP measures:          
      Interest income - loans$ 22,697  $22,394  $21,993  $ 87,881  $82,869  
      Interest income - investments and other 1,870   1,860   2,673   8,247   10,355  
      Interest expense - deposits (1,821)  (2,118)  (3,496)  (9,729)  (13,143) 
      Interest expense - customer repurchase          
         agreements  (22)  (42)  (134)  (259)  (596) 
      Interest expense - other short-term borrowings    -   -   -   -   (54) 
      Interest expense - long-term borrowings (509)  (524)  (512)  (2,032)  (1,935) 
      Total net interest income$ 22,215  $21,570  $20,524  $ 84,108  $77,496  
      Less non-GAAP measures:          
      Tax benefit on nontaxable interest - loans (43)  (48)  (46)  (181)  (185) 
      Tax benefit on nontaxable interest - securities    (26)  (27)  (30)  (107)  (184) 
      GAAP measures$ 22,146  $21,495  $20,448  $ 83,820  $77,127  
              
              
RETURN ON AVERAGE TANGIBLE EQUITY         
      Return on average equity (GAAP basis) 10.48 % 8.76 % 9.31 % 9.12 % 7.16 %
      Impact of excluding average goodwill          
         and other intangibles 4.42   3.90   4.40   4.07   3.27  
      Return on average tangible equity          
         (non-GAAP)  14.90 % 12.66 % 13.71 % 13.19 % 10.43 %
              
TANGIBLE EQUITY TO TANGIBLE ASSETS          
      Equity to assets ratio (GAAP basis) 11.08 % 11.43 % 12.92 % 11.08 % 12.92 %
      Impact of excluding goodwill and          
         other intangibles (2.74)  (2.88)  (3.35)  (2.74)  (3.35) 
      Tangible equity to tangible assets ratio          
         (non-GAAP)  8.34 % 8.55 % 9.57 % 8.34 % 9.57 %
              
TANGIBLE BOOK VALUE          
      Book value per share (GAAP basis)$ 30.77  $30.26  $28.93  $ 30.77  $28.93  
      Impact of excluding goodwill and          
         other intangibles (8.30)  (8.34)  (8.29)  (8.30)  (8.29) 
      Tangible book value per share          
         (non-GAAP) $ 22.47  $21.92  $20.64  $ 22.47  $20.64  
              
ADJUSTED LOAN LOSS ALLOWANCE          
      Allowance for loan losses$ 21,403  $21,088  $13,152  $ 21,403  $13,152  
      Credit discount on purchased loans 7,255   7,896   12,214   7,255   12,214  
      Adjusted loan loss allowance$ 28,658  $28,984  $25,366  $ 28,658  $25,366  
              
      Total loans, net$ 2,015,056  $2,086,094  $1,830,815  $ 2,015,056  $1,830,815  
      Subtract: PPP loans, net (211,275)  (265,941)  -   (211,275)  -  
      Total loans less PPP loans, net$ 1,803,781  $1,820,153  $1,830,815  $ 1,803,781  $1,830,815  
              
      Adjusted loan loss allowance to          
         total loans less PPP loans, net 1.59 % 1.59 % 1.39 % 1.59 % 1.39 %
              

Contact:

Jeffrey W. Farrar
Executive Vice President, COO & CFO
(434)773-2274
farrarj@amnb.com 


Data & News supplied by www.cloudquote.io
Stock quotes supplied by Barchart
Quotes delayed at least 20 minutes.
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.