President & CEO,
Third Quarter 2026 Highlights
Income Statement
- Net income of
$3,969,000 for the third quarter of 2026, an increase of$1,087,000 , or 37.72%, from the same time period in 2025.
- Net interest margin for the third quarter of 2026 was 4.11%, an increase of 35 basis points over the same quarter of 2025. The increase is primarily driven by consistent asset yields and a lower cost of interest-bearing liabilities.
- For the three months ended
September 30, 2026 , the Bank recorded a provision for credit loss expense of$204,000 including a reserve for unfunded commitments of$72,000 . This compares to$326,000 for the same period last year, representing a decrease of$122,000 . The provision recorded during the quarter mainly reflected allocations necessitated by net loan growth and adjustments to historical loss factors to better represent expectations for future credit losses.
- Noninterest income increased by
$285,000 , or 19.31%, to$1,761,000 for the three months endedSeptember 30, 2026 , compared to$1,476,000 for same period of 2025. The increase is attributed to an increase in service charges on deposit accounts and an increase in gain on sale of mortgage loans.
- Noninterest expense increased
$274,000 from$5,861,000 atSeptember 30, 2025 , to$6,135,000 atSeptember 30, 2026 . The increase is primarily related to increases in salaries and employee benefits, debit card expense, and core processing expenses.
- Annualized return on average assets ("ROA") was 1.76% for the third quarter of 2026 compared to 1.23% for the same period of 2025. Annualized return on average common equity ("ROE") was 16.70% for the third quarter of 2026 compared to 12.48% for the same period of 2025.
Balance Sheet and Asset Quality
- Total unconsolidated assets amounted to
$941,677,000 , an increase of$16,170,000 , or 1.75% above total assets atDecember 31, 2025 of$925,507,000 .
- Debt securities available for sale decreased
$20,927,000 from December 31, 2025. The decrease is primarily attributable to the maturity of$22,000,000 in low yielding agency securities,$1,000,000 in corporate bonds, and$2,400,000 in municipal bonds, offset by the purchase of$5,175,000 mortgage-backed securities,$785,000 municipal bonds,$1,000,000 treasury notes, and$1,000,000 agency securities during the first nine months of 2026.
- Net loans increased
$31,139,000 , or 4.15%. Deposits increased$5,283,000 , or 0.64%. The net effect of these balance sheet changes resulted in a decrease in cash and cash equivalents of$236,000 , or (0.42%). The Bank's loan to deposit ratio of 94.07%, onSeptember 30, 2026 , is a 1.98% increase from 92.09% atDecember 31, 2025 .
- The Bank had no foreclosed properties at
December 31, 2025 , andSeptember 30, 2026 , respectively. Therefore, non-performing assets only consisted of nonaccrual loans. One commercial and industrial loan totaling$44,000 was added during the third quarter, offset by continued payments on the existing non-performing assets, therefore, non-performing assets increased atSeptember 30, 2026 , to$75,000 , compared to$41,000 atDecember 31, 2025 .
- The allowance for credit losses to total loans was 1.13% of total loans on
September 30, 2026 , compared to 1.10% onDecember 31, 2025 and 1.16% atSeptember 30, 2025 .
- Book value per share at
September 30, 2026 , was$49.29 , an increase of$5.10 from year-end 2025.
Capital
As of
About Bank of Botetourt
Founded in 1899, Bank of Botetourt is a full-service community bank dedicated to helping individuals, families, businesses, and organizations achieve their financial goals through personalized service, local decision-making, and trusted relationships. Offering personal banking, business banking, mortgage lending, and wealth management services throughout western Virginia, the Bank is known for its award-winning service, financial strength, and unwavering commitment to the communities it serves. For more than 125 years, Bank of Botetourt has remained focused on delivering exceptional customer experiences while supporting the economic vitality of the region.
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| | | (unaudited) | | (audited) |
| | | | | |
| | | 2026 | | 2025 |
| Assets | | | | |
| | | | | |
| Cash and due from banks | | $ 13,323,000 | | $ 13,031,000 |
| Interest-bearing deposits with banks | | 42,141,000 | | 42,117,000 |
| Federal funds sold | | 730,000 | | 1,282,000 |
| Total cash and cash equivalents | | 56,194,000 | | 56,430,000 |
| Debt securities held to maturity, net of allowance | | 8,832,000 | | 9,182,000 |
| for credit losses of | | | | |
| | | | | |
| Debt securities available for sale | | 49,035,000 | | 69,962,000 |
| Loans, net of allowance for credit losses of | | 781,507,000 | | 750,368,000 |
| | | | | |
| Loans held for sale | | 1,361,000 | | 1,737,000 |
| Premises and fixed assets, net | | 18,252,000 | | 16,515,000 |
| Investment in unconsolidated subsidiaries | | 5,620,000 | | 3,517,000 |
| Other assets | | 20,876,000 | | 17,796,000 |
| Total assets | | $ 941,677,000 | | $ 925,507,000 |
| | | | | |
| Liabilities and Stockholders' Equity | | | | |
| Liabilities | | | | |
| Noninterest-bearing deposits | | $ 188,814,000 | | $ 166,954,000 |
| Interest-bearing deposits | | 641,939,000 | | 658,516,000 |
| Total deposits | | 830,753,000 | | 825,470,000 |
| | | | | |
| Other liabilities | | 6,978,000 | | 6,520,000 |
| Total liabilities | | 837,731,000 | | 831,990,000 |
| | | | | |
| Commitments and contingencies | | - | | - |
| | | | | |
| Stockholders' Equity | | | | |
| Preferred stock, | | | | |
| authorized; 243,659 issued and outstanding | | | | |
| at | | 244,000 | | 244,000 |
| Common stock, | | | | |
| authorized; 1,976,780 and 1,970,230 issued and | | | | |
| outstanding at | | | | |
| respectively | | 2,965,000 | | 2,955,000 |
| Additional paid-in capital | | 24,803,000 | | 24,504,000 |
| Retained earnings | | 78,352,000 | | 67,834,000 |
| Accumulated other comprehensive loss | | (2,418,000) | | (2,020,000) |
| Total stockholders' equity | | 103,946,000 | | 93,517,000 |
| Total liabilities and stockholders' equity | | $ 941,677,000 | | $ 925,507,000 |
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| | Nine Months Ended | | Three Months Ended | ||||
| | | ||||||
| | 2026 | | 2025 | | 2026 | | 2025 |
| Interest income | | | | | | | |
| Loans and fees on loans | $ 36,752,000 | | $ 32,633,000 | | $ 12,558,000 | | $ 11,329,000 |
| Securities: | | | | | | | |
| | 328,000 | | 441,000 | | 93,000 | | 140,000 |
| Mortgage-backed securities | 430,000 | | 191,000 | | 154,000 | | 82,000 |
| All other securities | 639,000 | | 622,000 | | 220,000 | | 205,000 |
| Due from depository institutions | 1,218,000 | | 1,370,000 | | 364,000 | | 365,000 |
| Federal funds sold | 26,000 | | 25,000 | | 10,000 | | 8,000 |
| Total Interest income | 39,393,000 | | 35,282,000 | | 13,399,000 | | 12,129,000 |
| | | | | | | | |
| Interest expense | | | | | | | |
| Deposits | 11,855,000 | | 11,645,000 | | 3,817,000 | | 3,821,000 |
| Other borrowings | 3,000 | | 18,000 | | 1,000 | | 18,000 |
| Total Interest expense | 11,858,000 | | 11,663,000 | | 3,818,000 | | 3,839,000 |
| Net Interest Income | 27,535,000 | | 23,619,000 | | 9,581,000 | | 8,290,000 |
| | | | | | | | |
| Provision for credit losses | 1,044,000 | | 688,000 | | 204,000 | | 326,000 |
| Net Interest Income after credit loss expense | 26,491,000 | | 22,931,000 | | 9,377,000 | | 7,964,000 |
| | | | | | | | |
| Noninterest income | | | | | | | |
| Service charges on deposit accounts | 1,103,000 | | 976,000 | | 378,000 | | 342,000 |
| Securities brokerage and annuities | 269,000 | | 204,000 | | 90,000 | | 80,000 |
| Other income, net of gains | 5,474,000 | | 3,173,000 | | 1,293,000 | | 1,054,000 |
| Total noninterest income | 6,846,000 | | 4,353,000 | | 1,761,000 | | 1,476,000 |
| | | | | | | | |
| Noninterest expense | | | | | | | |
| Salaries and employee benefits | 7,672,000 | | 7,173,000 | | 2,550,000 | | 2,464,000 |
| Premises and fixed assets expense | 1,712,000 | | 1,806,000 | | 542,000 | | 619,000 |
| Other expense | 8,950,000 | | 8,158,000 | | 3,043,000 | | 2,778,000 |
| Total noninterest expense | 18,334,000 | | 17,137,000 | | 6,135,000 | | 5,861,000 |
| Income before income taxes | 15,003,000 | | 10,147,000 | | 5,003,000 | | 3,579,000 |
| | | | | | | | |
| Income tax expense | 2,648,000 | | 2,053,000 | | 1,034,000 | | 697,000 |
| Net income | 12,355,000 | | 8,094,000 | | 3,969,000 | | 2,882,000 |
| Preferred stock dividends | 358,000 | | 358,000 | | 120,000 | | 119,000 |
| Net income available to common shareholders | $ 11,997,000 | | $ 7,736,000 | | $ 3,849,000 | | $ 2,763,000 |
| | | | | | | | |
| Basic earnings per share | $ 6.08 | | $ 3.94 | | $ 1.95 | | $ 1.40 |
| Diluted earnings per share | $ 6.08 | | $ 3.94 | | $ 1.95 | | $ 1.40 |
| Dividends declared per share | $ 0.75 | | $ 0.675 | | $ 0.25 | | $ 0.225 |
| Basic weighted average shares outstanding | 1,974,027 | | 1,964,889 | | 1,975,969 | | 1,967,206 |
| Diluted weighted average shares outstanding | 1,974,027 | | 1,964,889 | | 1,975,969 | | 1,967,206 |
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