National Bankshares, Inc. (NKSH) has reported 2.47 percent fall in profit for the quarter ended Dec. 31, 2016. The company has earned $3.47 million, or $0.50 a share in the quarter, compared with $3.56 million, or $0.51 a share for the same period last year. Revenue during the quarter went up marginally by 1.52 percent to $10.97 million from $10.81 million in the previous year period. Net interest income for the quarter dropped 6.45 percent over the prior year period to $8.98 million. Non-interest income for the quarter rose 0.40 percent over the last year period to $2.49 million.
National Bankshares has made provision of $0.50 million for loan losses during the quarter, down 60.63 percent from $1.28 million in the same period last year.
Net interest margin contracted 35 basis points to 3.39 percent in the quarter from 3.74 percent in the last year period. Efficiency ratio for the quarter deteriorated to 53.70 percent from 48.25 percent in the previous year period. A rise in efficiency ratio suggests a fall in profitability.
"In 2016 we celebrated National Banks 125th year as a community bank, and were extremely thankful to the customers, shareholders, employees and directors, past and present, who have helped us reach this milestone," said National Bankshares chairman, president and chief executive officer James G. Rakes. "The low interest rate environment in 2016 continued to reduce margins and earnings. Despite this challenge, we focused on what we can control. We steadily grew our loan and deposit base by seeking out quality credits and providing superior customer service, while investing in the people and technology that will best position us for future growth."
Assets outpace liabilities growthTotal assets stood at $1,233.94 million as on Dec. 31, 2016, up 2.85 percent compared with $1,199.74 million on Dec. 31, 2015. On the other hand, total liabilities stood at $1,055.68 million as on Dec. 31, 2016, up 2.73 percent from $1,027.62 million on Dec. 31, 2015. Loans outpace deposit growthNet loans stood at $639.45 million as on Dec. 31, 2016, up 4.71 percent compared with $610.71 million on Dec. 31, 2015. Deposits stood at $1,043.44 million as on Dec. 31, 2016, up 2.41 percent compared with $1,018.86 million on Dec. 31, 2015. Investments stood at $440.41 million as on Dec. 31, 2016, up 13.13 percent or $51.12 million from year-ago. Shareholders equity stood at $178.26 million as on Dec. 31, 2016, up 3.57 percent or $6.15 million from year-ago.
Return on average assets moved down 6 basis points to 1.14 percent in the quarter from 1.20 percent in the last year period. At the same time, return on average equity decreased 54 basis points to 7.56 percent in the quarter from 8.10 percent in the last year period.
Nonperforming assets moved down 16.93 percent or $1.84 million to $9.01 million on Dec. 31, 2016 from $10.85 million on Dec. 31, 2015.
Average equity to average assets ratio was 15.03 percent for the quarter, up from 14.87 percent for the previous year quarter.
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