業績公告
即時報告
8-K
2026-07-23
國家銀行第二季淨收入飆升120% 出售保險股權及證券重整推升盈利
AI 繁中摘要
📄 **申報類型：8-K**
**公司：National Bankshares, Inc.（納斯達克：NKSH）**
**報告期間：2026 年第二季度（截至 2026 年 6 月 30 日）**
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**業績重點** 💰
- 第二季淨收入 **503 萬美元**（每股 0.79 美元），去年同期為 229 萬美元（0.36 美元），按年大增約 120%。
- 上半年（六個月）淨收入 **1,001 萬美元**（每股 1.57 美元），去年同期為 553 萬美元（0.87 美元），升幅約 81%。
- 總資產達 **18.3 億美元**，較去年同期 18.06 億美元穩步增長。
**關鍵事件與策略** 🔄
- **出售保險聯營股權**：第二季出售 Bearing Insurance Group 權益，錄得 **657 萬美元收益**。
- **證券組合重整**：出售低收益證券（加權平均收益率 1.80%），買入收益率達 5.26% 的按揭抵押證券（MBS），產生 **655 萬美元稅前虧損**，但管理層預期約 **1.8 年內**可透過提升利息收入收回成本，每年額外增加約 425 萬美元利息收入，並為 2026 及 2027 年淨息差分別貢獻 12 及 24 個基點。
- **淨息差改善**：第二季淨息差為 **3.00%**（去年同期 2.56%），受惠於貸款及證券收益率上升，以及定期存款成本下降。
- **非利息收入**：按年增長，主要受惠於核心系統轉換後信用卡手續費提升、信託收入及按揭貸款出售收益增加。
- **非利息支出**：按年減少，因去年同期有大型核心系統轉換費用（約 198 萬美元），今年相關開支消失。
**信貸與流動性** 🏦
- 貸款質量持續穩健：不良貸款比率僅 **0.03%**，信貸損失準備對不良貸款覆蓋率高達 **2,999%**。
- 存款結構多元，無經紀存款；市政存款佔 21.7%，非市政存款中約 20.8% 未受 FDIC 保障，但已設有抵押債券擔保。
- 流動性充足，擁有聯邦住宅貸款銀行及聯儲局信貸額度，加上低貸存比率，管理層認為足以應付未來需求。
**管理層展望** 📈
總裁 Lara Ramsey 表示，第二季業績顯著改善，未來將繼續透過近期擴張策略擴大市場份額，優化產品、科技及培訓，提供頂級個人化銀行服務，並為股東創造卓越價值。整體策略聚焦於中長期盈利能力提升。
**對投資者的潛在影響** 💡
- 一次性收益（出售股權）及重整虧損互相抵銷，但核心盈利（利息收入）結構已顯著改善，預期未來息差持續擴闊。
- 股息維持每半年 **0.75 美元**（去年同期 0.73 美元），反映盈利穩健。
- 資本充裕，銀行被監管機構評為「資本充足」，有利於未來擴張及
展開英文正文
EX-99.1 2 nksh-ex99_1.htm NATIONAL BANKSHARES, INC. PRESS RELEASE, DATED MARCH 24, 2025 EX-99.1 EXHIBIT 99.1 FOR IMMEDIATE RELEASE CONTACTS: Lara Ramsey, President and CEO Lora M. Jones, Treasurer & CFO (540) 951-6250 [email protected] (540) 951-6238 [email protected] National Bankshares, Inc. Reports Results for the Three and Six Months Ended June 30, 2026 BLACKSBURG, VA., July 23, 2026 -- National Bankshares, Inc. (“the Company”) (Nasdaq: NKSH), parent company of The National Bank of Blacksburg (“the Bank”) and National Bankshares Financial Services, Inc., today announced its results of operations through the second quarter of 2026. The Company reported net income of $10.01 million or $1.57 per diluted common share for the six months ended June 30, 2026. This compares with net income of $5.53 million or $0.87 per diluted common share for the six months ended June 30, 2025. For the three month period ended June 30, 2026, the Company reported net income of $5.03 million or $0.79 per diluted common share. This compares with net income for the three month period ended June 30, 2025 of $2.29 million or $0.36 per diluted common share. National Bankshares, Inc. ended June 30, 2026 with total assets of $1.83 billion. Lara E. Ramsey, President and CEO, commented, "We are pleased to report our second quarter results, with net income significantly improved from the same period last year. Notably, during the second quarter of 2026, we sold our stake in a community-bank insurance consortium and invested the proceeds in restructuring a portion of the securities portfolio to enhance profitability in the near and medium term. In the second half of 2026 and beyond, we continue to focus on building market share, especially through our recent expansions, while optimizing our products, technology, and training to deliver a top-notch personalized banking experience and outstanding shareholder value." Comparability The Company made minor reclassifications during the current period. Prior periods are presented on a comparable basis. Highlights Gain on Sale of Equity Investment During the second quarter of 2026, the Company recorded a gain of $6.57 million on the sale of its membership interest (held by the Company's subsidiary, National Bankshares Financial Services, Inc.) in Bearing Insurance Group, LLC. Securities Portfolio Repositioning Also during the second quarter, the Company completed a strategic repositioning of a portion of its securities available-for-sale portfolio. The Company sold agency securities with a total amortized cost of $110.69 million and mortgage-backed securities with a total amortized cost of $21.18 million. The securities sold had a weighted average yield of 1.80%. Following the sale, the Company purchased mortgage-backed securities, designated available-for-sale, with a total amortized cost of $127.33 million and a weighted average yield of 5.26%. The sale of securities resulted in a pre-tax loss of $6.55 million, which the Company expects to recover with improved earnings over approximately 1.8 years. The repositioning is expected to increase the Company's interest income by $4.25 million annually, adding 12 basis points to the projected net interest margin for 2026 and 24 basis points to the projected 2027 net interest margin. Net Interest Income The net interest margin improved when the second quarter of 2026 is compared with the first quarter of 2026 due to reduction in the cost of time deposits. When the second quarter of 2026 is compared with the second quarter of 2025, improvement in net interest margin stemmed from higher yields on loans and taxable securities and lower cost of time deposits and interest bearing deposit accounts. When the six month period ended June 30, 2026 is compared with the same period of 2025, the 101 Hubbard Street / Blacksburg, Virginia 24060 P.O. Box 90002 / Blacksburg, Virginia 24062-9002 540 951-6300 / 800 552-4123 www.nationalbankshares.com net interest margin improvement was driven by higher loan and securities yields and lower deposit costs, somewhat offset by lower yield on interest-bearing deposit assets. Noninterest Income When the second quarter of 2026 is compared with the first quarter of 2026, service charges on deposit accounts improved due to increased fee income for non-sufficient funds, credit and debit card fees, net, improved due to volume, trust income improved due to estate fee income recorded during the second quarter, and the gain on sale of mortgage loans held for sale improved due to higher volume. Other service charges and fees decreased due to the timing of recognition of safe deposit box income. During the first quarter, the Company recorded an annual bonus commission on insurance business production related to its ownership interest in Bearing Insurance. The Company does not expect that the annual bonus commission will be paid in future years due to the sale of its interest in Bearing Insurance. When the three and six month periods ended June 30, 2026 are compared with the same periods of 2025, noninterest income increased. Credit and debit card fees, net, increased due to improved terms for interchange fee income associated with the Company's core system conversion in May of 2025, trust income increased due to estate fee income, other income increased primarily due to higher commissions on securities sales and the gain on sale of mortgage loans held for sale improved due to higher volume. Noninterest Expense When the second quarter of 2026 is compared with the first quarter of 2026, noninterest expense decreased slightly, primarily due to winter weather-related costs during the first quarter. When comparing the three and six month periods ended June 30, 2026 with the comparable periods of 2025, total noninterest expense decreased. During 2025, the Company recorded specific expense for the core system conversion, as well as associated marketing and mailing expense included in other noninterest expense. Salaries and employee benefits increased due to higher medical insurance and incentive programs. Occupancy, furniture and fixtures increased due to depreciation and amortization of assets placed into service during 2025 for the new core system and the Company's Roanoke and Lynchburg branch locations. Data processing increased due to various categories. Professional services decreased due to lower legal expense. Other operating expense also decreased due to improvement in the pension non-service benefit. Securities The net unrealized loss on securities improved when June 30, 2026 is compared with March 31, 2026 and June 30, 2025, primarily due to the securities portfolio repositioning. Analysis as of June 30, 2026 did not indicate credit risk concerns with any of the Company’s securities. DepositsThe Company’s depositors within its market areas are diverse and include individuals, businesses and municipalities. The Company does not have any brokered deposits. Depositors are insured up to the FDIC maximum of $250 thousand. Municipal deposits, which account for 21.7% of the Company’s deposits, have additional security from bonds pledged as collateral, in accordance with state regulation. Of the Company’s non-municipal deposits, approximately 20.8% are uninsured. Liquidity The Company’s liquidity position remains solid. The Company maintains borrowing lines with the Federal Home Loan Bank of Atlanta (“FHLB”) and the Federal Reserve that provide substantial borrowing capacity. Combined with a low loan-to-deposit ratio, positive results of the latest liquidity stress testing and strategic deposit marketing, the Company believes it is well positioned to meet foreseeable liquidity demands. Loans and Credit Quality Loans increased from March 31, 2026 and from June 30, 2025, driven primarily by growth in construction loans. The Company is positioned to continue to make every loan that meets its underwriting standards. Loan metrics continue to reflect low credit risk, with low charge-off and past due levels. The Company recorded a provision for credit losses for the second quarter of 2026, compared with a recovery of credit losses for the first quarter of 2026, reflecting portfolio growth and some softening in certain economic factors. When the six month period ended June 30, 2026 is compared with the 2 same period of 2025, the provision for credit losses decreased due to a lower ACL ratio, determined by the Company's analysis of credit risk factors. Stockholders’ Equity The Company paid a semiannual dividend of $0.75 to shareholders on June 1, 2026. Stockholders’ equity increased when June 30, 2026 is compared with March 31, 2026 and June 30, 2025 due to net income and improvement in unrealized losses on available for sale securities, which are reflected, net of tax, in accumulated other comprehensive loss. Accumulated other comprehensive loss is excluded from the Bank’s regulatory capital and does not affect regulatory capital ratios. The Bank is considered well capitalized, with capital ratios substantially higher than minimum regulatory requirements, and meets all requirements for borrowing from the FHLB. 3 About National Bankshares National Bankshares, Inc., headquartered in Blacksburg, Virginia, is the parent company of The National Bank of Blacksburg, which does business as National Bank, and of National Bankshares Financial Services, Inc. National Bank is a community bank operating from 28 full-service offices in Southwestern, Western and Central Virginia, and one loan production office in Charlottesville, Virginia. National Bankshares Financial Services, Inc. is an investment and insurance subsidiary in the same trade area. The Company’s stock is traded on the Nasdaq Capital Market under the symbol “NKSH.” Additional information is available at www.nationalbankshares.com. Forward-Looking Statements This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by use of words such as “may,” “will,” “anticipates,” “believes,” “expects,” “plans,” “estimates,” “potential,” “continue,” “should,” and similar words or phrases. These statements are based upon current and anticipated economic conditions, nationally and in the Company’s market, interest rates and interest rate policy, competitive factors, and other conditions which by their nature, are not susceptible to accurate forecast and are subject to significant uncertainty. Although we believe that our expectations with respect to forward-looking statements are based upon reasonable assumptions within the bounds of our existing knowledge of our business and operations, there can be no assurance that actual future results, performance, achievements, or trends will not differ materially from any projected future results, performance, achievements or trends expressed or implied by such forward-looking statements. Actual future results, performance, achievements or trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to, the following: the level of inflation; interest rates; national and local economic conditions; monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury, the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Consumer Financial Protection Bureau and the Federal Deposit Insurance Corporation, and the impact of any policies or programs implemented pursuant to financial reform legislation; unanticipated increases in the level of unemployment in the Company’s market; the quality or composition of the loan and/or investment portfolios; the sufficiency of the Company’s allowance for credit losses; demand for loan products; deposit flows, including impact on liquidity; competition; demand for financial services in the Company’s market; the real estate market conditions in the Company’s market; laws, regulations and policies impacting financial institutions; adverse developments in the financial industry generally, such as the recent bank failures, responsive measures to mitigate and manage such developments, related supervisory and regulatory actions and costs, and related impacts on customer behavior; technological risks and developments, and cyber-threats, attacks or events; the Company’s technology initiatives; geopolitical conditions, including acts or threats of terrorism and/or military conflicts, or actions taken by the U.S. or other governments in response to acts or threats of terrorism and/or military conflicts; the occurrence of significant natural disasters, including severe weather conditions, floods, and other catastrophic events; the Company's ability to identify, attract, and retain experienced management, relationship managers, and support personnel, particularly in a competitive labor environment; performance by the Company’s counterparties or vendors; applicable accounting principles, policies and guidelines; the impact of public health events, including the adverse impact on our business and operations and on our customers; and other factors described from time to time in the Company’s reports (such as our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K) filed with the Securities and Exchange Commission. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. The Company does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events. 4 National Bankshares, Inc. Consolidated Balance Sheets (Unaudited) June 30, March 31, June 30, (in thousands, except share and per share data) 2026 2026 2025 Assets Cash and due from banks $ 8,854 $ 7,976 $ 9,798 Interest-bearing deposits 45,709 54,177 83,051 Total cash and cash equivalents 54,563 62,153 92,849 Securities available for sale, at fair value 652,660 658,112 590,021 Mortgage loans held for sale 331 608 1,072 Loans: Real estate construction loans 72,220 53,500 44,529 Consumer real estate loans 330,204 331,110 317,949 Commercial real estate loans 456,181 452,881 494,755 Commercial non real estate loans 49,616 50,736 51,383 Public sector and IDA loans 62,124 62,740 56,347 Consumer non real estate loans 45,067 45,097 46,172 Total loans 1,015,412 996,064 1,011,135 Less: deferred fees and costs (758 ) (674 ) (438 ) Loans, net of deferred fees and costs 1,014,654 995,390 1,010,697 Less: allowance for credit losses on loans ("ACLL") (10,047 ) (9,739 ) (10,422 ) Loans, net 1,004,607 985,651 1,000,275 Premises and equipment, net 18,269 18,397 17,829 Accrued interest receivable 7,029 7,001 6,413 Goodwill 10,718 10,718 10,718 Core deposit intangible, net 1,319 1,403 1,671 Bank-owned life insurance ("BOLI") 49,174 48,869 47,958 Other assets 34,030 36,081 37,174 Total assets $ 1,832,700 $ 1,828,993 $ 1,805,980 Liabilities and Stockholders' Equity Noninterest-bearing demand deposits $ 313,453 $ 302,844 $ 306,427 Interest-bearing demand deposits 861,560 866,848 852,405 Savings deposits 139,593 145,134 140,285 Time deposits 314,850 314,938 328,558 Total deposits 1,629,456 1,629,764 1,627,675 Accrued interest payable 1,439 1,600 1,522 Other liabilities 9,574 10,231 8,047 Total liabilities 1,640,469 1,641,595 1,637,244 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 and additional paid in capital. Authorized 10,000,000 shares; issued and outstanding 6,370,620 (including 4,619 unvested) shares at June 30, 2026 6,368,410 (including 5,039 unvested) shares at March 31, 2026, and 6,366,001 (including 5,028 unvested) shares at June 30, 2025 $ 22,149 $ 22,086 $ 21,925 Retained earnings 207,789 207,539 197,223 Accumulated other comprehensive loss, net (37,707 ) (42,227 ) (50,412 ) Total stockholders' equity 192,231 187,398 168,736 Total liabilities and stockholders' equity $ 1,832,700 $ 1,828,993 $ 1,805,980 5 National Bankshares, Inc. Consolidated Statements of Income (Unaudited) Three Months Ended June 30, March 31, June 30, (in thousands, except share and per share data) 2026 2026 2025 Interest Income Interest and fees on loans $ 14,068 $ 13,944 $ 13,494 Interest on federal funds sold - - 2 Interest on interest-bearing deposits 605 424 978 Interest on securities – taxable 4,439 4,233 3,725 Interest on securities – nontaxable 342 340 337 Total interest income 19,454 18,941 18,536 Interest Expense Interest on time deposits 2,541 2,631 3,058 Interest on other deposits 3,856 3,687 4,488 Interest on borrowings 7 - - Total interest expense 6,404 6,318 7,546 Net interest income 13,050 12,623 10,990 Provision for (recovery of) credit losses 317 (73 ) 36 Net interest income after provision for (recovery of) credit losses 12,733 12,696 10,954 Noninterest Income Service charges on deposit accounts 690 649 734 Other service charges and fees 69 142 73 Credit and debit card fees, net 544 457 366 Trust income 667 584 578 BOLI income 306 301 297 Gain on sale of mortgage loans held for sale 75 19 54 Other income 278 527 177 Gain on sale of equity investment 6,566 - - Loss on sale of securities, net (6,549 ) - - Total noninterest income 2,646 2,679 2,279 Noninterest Expense Salaries and employee benefits 5,788 5,834 5,211 Occupancy, furniture and fixtures 838 884 731 Data processing 965 928 617 FDIC assessment 207 207 210 Intangible asset amortization 84 87 95 Franchise taxes 351 350 358 Professional services 358 373 509 Core system conversion expense - - 1,977 Other operating expenses 711 665 874 Total noninterest expense 9,302 9,328 10,582 Income before income taxes 6,077 6,047 2,651 Income tax expense 1,048 1,066 362 Net Income $ 5,029 $ 4,981 $ 2,289 Basic net income per common share $ 0.79 $ 0.78 $ 0.36 Diluted net income per common share $ 0.79 $ 0.78 $ 0.36 Weighted average number of common shares outstanding, basic 6,363,920 6,363,371 6,358,917 Weighted average number of common shares outstanding, diluted 6,367,161 6,366,154 6,361,582 Dividends declared per common share $ 0.75 $ - $ 0.73 6 National Bankshares, Inc. Consolidated Statements of Income (Unaudited) Six Months Ended (in thousands, except share and per share data) June 30, 2026 June 30, 2025 Interest Income Interest and fees on loans $ 28,012 $ 26,454 Interest on federal funds sold - 5 Interest on interest-bearing deposits 1,029 2,017 Interest on securities – taxable 8,672 7,585 Interest on securities – nontaxable 682 673 Total interest income 38,395 36,734 Interest Expense Interest on time deposits 5,172 6,369 Interest on other deposits 7,543 9,124 Interest on borrowings 7 - Total interest expense 12,722 15,493 Net interest income 25,673 21,241 Provision for credit losses 244 312 Net interest income after provision for credit losses 25,429 20,929 Noninterest Income Service charges on deposit accounts 1,339 1,433 Other service charges and fees 211 156 Credit and debit card fees, net 1,001 783 Trust income 1,251 1,157 BOLI income 607 589 Gain on sale of mortgage loans held for sale 94 79 Other income 805 642 Gain on sale of equity investment 6,566 - Loss on sale of securities, net (6,549 ) - Total noninterest income 5,325 4,839 Noninterest Expense Salaries and employee benefits 11,622 10,391 Occupancy, furniture and fixtures 1,722 1,470 Data processing 1,893 1,600 FDIC assessment 414 417 Intangible asset amortization 171 192 Franchise taxes 701 731 Professional services 731 808 Core system conversion expense - 2,023 Other operating expenses 1,376 1,583 Total noninterest expense 18,630 19,215 Income before income tax expense 12,124 6,553 Income tax expense 2,114 1,028 Net Income $ 10,010 $ 5,525 Basic net income per common share $ 1.57 $ 0.87 Diluted net income per common share $ 1.57 $ 0.87 Weighted average number of common shares outstanding, basic 6,363,647 6,358,665 Weighted average number of common shares outstanding, diluted 6,366,660 6,360,990 Dividends declared per common share $ 0.75 $ 0.73 7 National Bankshares, Inc. Net Interest Margin (Unaudited) Three Months Ended June 30, 2026 Three Months Ended March 31, 2026 ($ in thousands) AverageBalance Interest AverageYield/Rate AverageBalance Interest AverageYield/Rate Interest-earning assets: Loans (1)(2)(3)(4) $ 1,007,549 $ 14,226 5.66 % $ 995,459 $ 14,110 5.75 % Taxable securities (4) 636,331 4,439 2.80 % 640,048 4,233 2.68 % Nontaxable securities (1)(4) 62,388 433 2.78 % 62,500 430 2.79 % Interest-bearing deposits 70,878 605 3.42 % 51,918 424 3.31 % Total interest-earning assets $ 1,777,146 $ 19,703 4.45 % $ 1,749,925 $ 19,197 4.45 % Interest-bearing liabilities: Interest-bearing demand deposits $ 869,047 $ 3,803 1.76 % $ 855,206 $ 3,635 1.72 % Savings deposits 141,382 53 0.15 % 144,444 52 0.15 % Time deposits(5) 311,990 2,541 3.27 % 315,751 2,631 3.38 % Borrowings 769 7 3.65 % - - - Total interest-bearing liabilities $ 1,323,188 $ 6,404 1.94 % $ 1,315,401 $ 6,318 1.95 % Net interest income and interest rate spread $ 13,299 2.51 % $ 12,879 2.50 % Net interest margin 3.00 % 2.98 % Three Months Ended June 30, 2025 ($ in thousands) AverageBalance Interest AverageYield/Rate Interest-earning assets: Loans (1)(2)(3)(4) $ 1,008,401 $ 13,618 5.42 % Taxable securities (4) 596,497 3,725 2.50 % Nontaxable securities (1)(4) 62,847 426 2.72 % Federal funds sold 197 2 4.07 % Interest-bearing deposits 90,507 978 4.33 % Total interest-earning assets $ 1,758,449 $ 18,749 4.28 % Interest-bearing liabilities: Interest-bearing demand deposits $ 853,516 $ 4,440 2.09 % Savings deposits 143,470 48 0.13 % Time deposits(5) 330,906 3,058 3.71 % Total interest-bearing liabilities $ 1,327,892 $ 7,546 2.28 % Net interest income and interest rate spread $ 11,203 2.00 % Net interest margin 2.56 % (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)Included in loan interest income are loan fees and net accretion of deferred fees and costs of $169, $202 and $113 for the three months ended June 30, 2026, March 31, 2026 and June 30, 2025, respectively. Also included are net accretion of acquisition discounts of $177, $417 and $363 for the three months ended June 30, 2026, March 31, 2026 and June 30, 2025, respectively. (3)Includes loans held for sale and nonaccrual loans. (4)Daily averages are shown at amortized cost. (5)Included in time deposit expense is net amortization of acquisition premiums of $16, $18, and $43 for the three months ended June 30, 2026, March 31, 2026 and June 30, 2025, respectively. 8 Six Months Ended June 30, June 30, 2026 June 30, 2025 ($ in thousands) AverageBalance Interest AverageYield/Rate AverageBalance Interest AverageYield/Rate Interest-earning assets: Loans (1)(2)(3)(4) $ 1,001,538 $ 28,337 5.71 % $ 1,001,763 $ 26,696 5.37 % Taxable securities (4) 638,179 8,672 2.74 % 605,170 7,585 2.53 % Nontaxable securities (1)(4) 62,444 863 2.79 % 62,905 852 2.73 % Federal funds sold - - - 229 5 4.40 % Interest-bearing deposits 61,450 1,029 3.38 % 92,458 2,017 4.40 % Total interest-earning assets $ 1,763,611 $ 38,901 4.45 % $ 1,762,525 $ 37,155 4.25 % Interest-bearing liabilities: Interest-bearing demand deposits $ 862,165 $ 7,438 1.74 % $ 862,213 $ 9,023 2.11 % Savings deposits 142,904 105 0.15 % 143,727 101 0.14 % Time deposits(5) 313,860 5,172 3.32 % 336,085 6,369 3.82 % Borrowings 387 7 3.65 % - - - Total interest-bearing liabilities $ 1,319,316 $ 12,722 1.94 % $ 1,342,025 $ 15,493 2.33 % Net interest income and interest rate spread $ 26,179 2.51 % $ 21,662 1.92 % Net interest margin 2.99 % 2.48 % (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)Included in loan interest income are loan fees and net accretion of deferred fees and costs of $371 and $199 for the six months ended June 30, 2026 and June 30, 2025, respectively. Also included are net accretion of acquisition discounts of $594 and $615 for the six months ended June 30, 2026 and June 30, 2025, respectively. (3)Includes loans held for sale and nonaccrual loans. (4)Daily averages are shown at amortized cost. (5)Included in time deposit expense is net amortization of acquisition premiums of $34 and $101 for the six months ended June 30, 2026 and June 30, 2025, respectively. 9 National Bankshares, Inc. Key Ratios and Other Data (Unaudited) As of or for the Three Months Ended ($ in thousands) June 30, March 31, June 30, 2026 2026 2025 Average Balances Cash and due from banks $ 7,404 $ 7,353 $ 12,248 Interest-bearing deposits 70,878 51,918 90,507 Securities available for sale, at fair value 643,444 653,722 591,249 Mortgage loans held for sale 526 145 495 Loans, gross 1,008,521 996,746 1,008,420 Loans, net of deferred fees and costs 1,007,023 995,314 1,007,906 Loans, net of deferred fees and costs and the ACLL 997,323 985,473 997,461 Intangible assets 12,087 12,173 12,447 Total assets 1,841,236 1,819,379 1,815,371 Noninterest-bearing demand deposits $ 316,504 $ 306,202 $ 307,888 Interest-bearing demand and savings deposits 1,010,429 999,650 996,986 Time deposits 311,990 315,751 330,906 Total deposits 1,638,923 1,621,603 1,635,780 Total stockholders' equity 189,185 185,707 166,971 Financial Ratios Return on average assets(1) 1.09 % 1.08 % 0.77 % Return on average equity(1) 10.64 % 10.57 % 8.37 % Efficiency ratio(2) 58.40 % 59.96 % 63.83 % Average equity to average assets 10.27 % 10.21 % 9.20 % Tangible common equity to tangible assets(3) 9.90 % 9.65 % 8.72 % Allowance for Credit Losses on Loans Beginning balance $ 9,739 $ 9,892 $ 10,490 Provision for (recovery of) credit losses 323 (63 ) 45 Charge-offs (93 ) (183 ) (141 ) Recoveries 78 93 28 Ending Balance $ 10,047 $ 9,739 $ 10,422 (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 efficiency ratio is calculated as noninterest expense divided by the sum of noninterest income and net interest income on a fully taxable equivalent basis. Noninterest income and noninterest expense are adjusted for any non-recurring items. See “Reconciliation of Non-GAAP Financial Measures” at the end of this release. (3)Tangible common equity and tangible assets exclude goodwill and intangible assets of $12,037 as of June 30, 2026, $12,121 as of March 31, 2026 and $12,389 as of June 30, 2025. See “Reconciliation of Non-GAAP Financial Measures” at the end of this release. 10 National Bankshares, Inc. Key Ratios and Other Data (Unaudited) As of or for the Six Months Ended ($ in thousands) June 30, 2026 June 30, 2025 Average Balances Cash and due from banks $ 7,378 $ 12,875 Interest-bearing deposits 61,450 92,458 Securities available for sale, at fair value 648,555 596,989 Mortgage loans held for sale 337 322 Loans, gross 1,002,666 1,002,016 Loans, net of deferred fees and costs 1,001,201 1,001,441 Loans, net of deferred fees and costs and the ACLL 991,431 991,099 Intangible assets 12,130 12,494 Total assets 1,830,367 1,817,524 Noninterest-bearing demand deposits $ 311,382 $ 299,820 Interest-bearing demand and savings deposits 1,005,069 1,005,940 Time deposits 313,860 336,085 Total deposits 1,630,311 1,641,845 Total stockholders' equity 187,664 163,857 Financial Ratios Return on average assets(1) 1.09 % 0.69 % Return on average equity(1) 10.65 % 7.69 % Efficiency ratio(2) 59.17 % 64.87 % Average equity to average assets 10.25 % 9.02 % Tangible common equity to tangible assets(3) 9.90 % 8.72 % Allowance for Credit Losses on Loans Beginning balance $ 9,892 $ 10,262 Provision for credit losses 260 322 Charge-offs (276 ) (253 ) Recoveries 171 91 Ending Balance $ 10,047 $ 10,422 (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 efficiency ratio is calculated as noninterest expense divided by the sum of noninterest income and net interest income on a fully taxable equivalent basis. Noninterest income and noninterest expense are adjusted for any non-recurring items. See “Reconciliation of Non-GAAP Financial Measures” at the end of this release. (3)Tangible common equity and tangible assets exclude goodwill and intangible assets of $12,037 as of June 30, 2026 and $12,389 as of June 30, 2025. See “Reconciliation of Non-GAAP Financial Measures” at the end of this release. 11 National Bankshares, Inc. Asset Quality Data (Unaudited) As of June 30, March 31, June 30, ($ in thousands) 2026 2026 2025 Nonperforming Assets Nonaccrual loans $ 335 $ 344 $ 2,111 Total nonperforming assets $ 335 $ 344 $ 2,111 Loans past due 90 days or more, and still accruing $ 243 $ 230 $ 21 Asset Quality Ratios Ratio of nonperforming loans to total loans(1) 0.03 % 0.03 % 0.21 % ACLL to total loans(1) 0.99 % 0.98 % 1.03 % Ratio of ACLL to nonperforming loans 2999.10 % 2831.10 % 493.70 % Loans past due 90 days or more to total loans (1) 0.02 % 0.02 % 0.00 % (1)Loans are net of deferred fees and costs. 12 National Bankshares, Inc. Reconciliation of Non-GAAP Financial Measures (Unaudited) In addition to financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company uses certain non-GAAP financial measures that provide useful information for financial and operational decision making, evaluating trends, and comparing financial results to other financial institutions. Non-GAAP financial measures are supplemental and not a substitute for, or more important than, financial measures prepared in accordance with GAAP and may not be comparable to those reported by other financial institutions. The non-GAAP financial measures presented in this document include the net interest margin, the efficiency ratio and the ratio of tangible common equity to tangible assets. For periods that are shorter than twelve months, the Company annualizes net income for the return on average assets and return on average equity. In order to prevent distortion, the Company does not annualize significant non-recurring income and expense items. The following tables present calculations underlying non-GAAP financial measures for the three month periods indicated. (in thousands) Three Months Ended Net Interest Margin, FTE June 30, 2026 March 31, 2026 June 30, 2025 Interest income (GAAP) $ 19,454 $ 18,941 $ 18,536 Add: FTE adjustment 249 256 213 Interest income, FTE (non-GAAP) 19,703 19,197 18,749 Interest expense (GAAP) 6,404 6,318 7,546 Net interest income, FTE (non-GAAP) $ 13,299 $ 12,879 $ 11,203 Average balance of interest-earning assets $ 1,777,146 $ 1,749,925 $ 1,758,449 Net interest margin 3.00 % 2.98 % 2.56 % (in thousands) Three Months Ended Efficiency Ratio June 30, 2026 March 31, 2026 June 30, 2025 Noninterest expense (GAAP) $ 9,302 $ 9,328 $ 10,582 Less: core system conversion expense – – (1,977 ) Adjusted noninterest expense (non-GAAP) $ 9,302 $ 9,328 $ 8,605 Noninterest income (GAAP) $ 2,646 $ 2,679 $ 2,279 Less: realized securities loss, net 6,549 – – Less: gain on sale of investment (6,566 ) – – Adjusted noninterest income (non-GAAP) $ 2,629 $ 2,679 $ 2,279 Net interest income, FTE (non-GAAP) 13,299 12,879 11,203 Total income for efficiency ratio (non-GAAP) $ 15,928 $ 15,558 $ 13,482 Efficiency ratio 58.40 % 59.96 % 63.83 % 13 (in thousands) Three Months Ended June 30, March 31, June 30, Annualized Net Income for Ratio Calculation 2026 2026 2025 Net income per GAAP $ 5,029 $ 4,981 $ 2,289 Less: expense (income) not annualized: Partnership income (loss) net of tax of ($49) and $8 for the periods ended March 31, 2026 and June 30, 2025, respectively – (184 ) 31 Gain on sale of investment, net of tax of ($1,379) for the period ended June 30, 2026 (5,187 ) – – Realized securities loss, net of tax of $1,375 for the period ended June 30, 2026 5,174 – – Core system conversion expense, net of tax of $415 for the period ended June 30, 2025 – – 1,562 Total non-annualized items (13 ) (184 ) 1,593 Adjusted net income 5,016 4,797 3,882 Adjusted net income, annualized $ 20,119 $ 19,455 $ 15,571 Add: total non-annualized items 13 184 (1,593 ) Annualized net income for ratio calculation (non-GAAP) $ 20,132 $ 19,639 $ 13,978 Return on average assets (GAAP) 1.10 % 1.11 % 0.51 % Adjusted return on average assets (non-GAAP) 1.09 % 1.08 % 0.77 % Return on average equity (GAAP) 10.66 % 10.88 % 5.50 % Adjusted return on average equity (non-GAAP) 10.64 % 10.57 % 8.37 % The following tables present calculations underlying non-GAAP financial measures for the six month periods indicated. Six Months Ended June 30, Net Interest Margin, FTE 2026 2025 Interest income (GAAP) $ 38,395 $ 36,734 Add: FTE adjustment 506 421 Interest income, FTE (non-GAAP) 38,901 37,155 Interest expense (GAAP) 12,722 15,493 Net interest income, FTE (non-GAAP) $ 26,179 $ 21,662 Average balance of interest-earning assets $ 1,763,611 $ 1,762,525 Net interest margin (non-GAAP) 2.99 % 2.48 % Six Months Ended June 30, Efficiency Ratio 2026 2025 Noninterest expense (GAAP) $ 18,630 $ 19,215 Less: core system conversion expense - (2,023 ) Adjusted noninterest expense (non-GAAP) $ 18,630 $ 17,192 Noninterest income (GAAP) $ 5,325 $ 4,839 Less: gain on sale of equity investment (6,566 ) - Less: loss on sale of securities, net 6,549 - Adjusted noninterest income (non-GAAP) 5,308 4,839 Net interest income, FTE (non-GAAP) 26,179