SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For quarterly period Ended September 30, 1995
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from to
Commission File No. 0-12896 (1934 Act)
OLD POINT FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
Virginia 54-1265373
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
1 West Mellen Street, Hampton, Va. 23663
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (804) 728-1200
Not Applicable
Former name, former address and former fiscal year, if
changed since last report.
Check whether the registrant (1) has filed all reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act
during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No
State the number of shares outstanding of each of the issuer's
classes of common stock as of October 15, 1995.
Class Outstanding at October 15, 1995
Common Stock, $5.00 par value 1,273,537 shares
OLD POINT FINANCIAL CORPORATION
FORM 10-Q
INDEX
PART I - FINANCIAL INFORMATION
Page
Item 1. Financial Statements 1
Consolidated Balance Sheets
September 30, 1995 and December 31, 1994 1
Consolidated Statement of Earnings
Three months ended September 30, 1995 and 1994 2
Nine months ended September 30, 1995 and 1994 2
Consolidated Statement of Cash Flows
Nine months ended September 30, 1995 and 1994 3
Consolidated Statements of Changes in Stockholders' Equity
Nine months ended September 30, 1995 and 1994 4
Notes to Consolidated Financial Statements 5
Parent Only Balance Sheets
September 30, 1995 and December 31, 1994 6
Parent Only Statement of Earnings
Three months ended September 30, 1995 and 1994 6
Nine months ended September 30, 1995 and 1994 6
Parent Only Statement of Cash Flows
Three months ended September 30, 1995 and 1994 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
Analysis of Changes in Net Interest Income 9
Interest Sensitivity Analysis 12
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 14
(i)
<TABLE>
<CAPTION>
PART 1. - FINANCIAL INFORMATION
OLD POINT FINANCIAL CORPORATION
Consolidated Balance Sheets September 30 December 31,
(Unaudited) 1995 1994
Assets
<S> <C> <C>
Cash and due from banks........................ $ 9,114,984 $ 8,940,712
Securities available for sale, at market....... 73,307,861 82,598,958
Securities to be held to maturity.............. 18,118,263 919,141
Trading account securities..................... -- --
Federal funds sold............................. 7,664,286 246,900
Loans, total (excluding unearned income)....... 183,447,404 173,740,982
Less reserve for loan losses............... 2,656,269 2,646,692
Net loans.............................. 180,791,135 171,094,290
Bank premises and equipment.................... 7,517,964 7,432,994
Other real estate owned........................ 757,364 213,700
Other assets................................... 5,735,203 6,232,817
Total assets.............................. $303,007,060 $277,679,512
Liabilities
Noninterest-bearing deposits................... $ 43,180,259 $ 37,086,440
Savings deposits............................... 96,052,047 96,985,612
Time deposits.................................. 116,574,385 101,527,085
Total deposits.............................. 255,806,691 235,599,137
Federal funds purchased and securities sold
under agreement to repurchase.............. 12,043,542 13,694,007
Interest-bearing demand notes issued
to the United States Treasury and
other liabilities for borrowed money....... 4,056,927 1,162,240
Other liabilities.............................. 1,285,187 1,002,989
Total liabilities........................... 273,192,347 251,458,373
Stockholders' Equity
Common stock, $5.00 par value.................. 6,367,685 6,319,515
1995 1994
Shares authorized......6,000,000 3,000,000
Shares outstanding.....1,273,537 1,261,283
Surplus........................................ 9,344,798 9,031,923
Undivided profits.............................. 14,072,341 12,793,050
Unrealized gain/(loss) on securities .......... 29,889 (1,923,349)
Total stockholders' equity................. 29,814,713 26,221,139
Total liabilities and stockholders' equity. $303,007,060 $277,679,512
See accompanying notes
</TABLE>
<TABLE>
<CAPTION>
OLD POINT FINANCIAL CORPORATION Three Months Ended Nine Months Ended
Consolidated Statements of Earnings September 30, September 30,
(Unaudited) 1995 1994 1995 1994
Interest Income
<S> <C> <C> <C> <C>
Interest and fees on loans..................... $ 4,039,952 $ 3,583,181 $11,886,433 $10,045,543
Interest on federal funds sold................. 99,471 8,181 206,990 99,715
Interest on securities:
Taxable..................................... 1,214,762 1,211,150 3,463,168 3,758,253
Exempt from federal income tax.............. 121,059 95,960 326,894 318,067
Interest on trading account securities......... 0 0 0 0
Total interest on securities............. 1,335,821 1,307,110 3,790,062 4,076,320
Total interest income...................... 5,475,244 4,898,472 15,883,485 14,221,578
Interest Expense
Interest on savings deposits................... 702,686 700,257 2,078,268 2,066,624
Interest on time deposits...................... 1,622,824 1,087,037 4,384,826 3,129,275
Interest on federal funds purchased and
securities sold under agreement
to repurchase.. 143,520 130,814 401,950 373,381
Interest on demand notes (note balances)
issued to the United States Treasury
and on other borrowed money.................. 38,451 4,434 86,612 7,592
Total interest expense..................... 2,507,481 1,922,542 6,951,656 5,576,872
Net interest income............................ 2,967,763 2,975,930 8,931,829 8,644,706
Provision for loan losses...................... 0 0 25,000 25,000
Net interest income after provision
for loan losses.............................. 2,967,763 2,975,930 8,906,829 8,619,706
Other Income
Income from fiduciary activities............... 359,838 314,838 1,079,514 944,464
Service charges on deposit accounts............ 466,816 456,500 1,425,443 1,316,995
Other service charges, commissions and fees.... 80,869 55,964 177,610 250,034
Other operating income......................... 40,169 24,957 173,168 189,473
Income from trading account.................... 0 0 0 0
Security gains (losses)........................ 0 (3,044) 0 407,081
Total other income......................... 947,692 849,215 2,855,735 3,108,047
Other Expenses
Salaries and employee benefits................. 1,800,476 1,773,968 5,345,882 5,277,459
Occupancy expense of Bank premises............. 178,581 181,606 526,842 528,213
Furniture and equipment expense................ 242,586 284,487 699,128 863,607
Other operating expenses....................... 668,398 759,344 2,233,471 2,321,207
Total other expenses....................... 2,890,041 2,999,405 8,805,323 8,990,486
Income before taxes............................ 1,025,414 825,740 2,957,241 2,737,267
Applicable income taxes ....................... 305,209 238,000 832,009 760,000
Net income..................................... $ 720,205 $ 587,740 $ 2,125,232 $ 1,977,267
Per Share
Based on weighted average number of
common shares outstanding.................... 1,273,537 1,261,283 1,271,813 1,259,488
Net income..................................... $ 0.57 $ 0.47 $ 1.67 $ 1.57
See accompanying notes
</TABLE>
<TABLE>
<CAPTION>
OLD POINT FINANCIAL CORPORATION Nine Months Ended
Consolidated Statements of Cash Flows September 30,
(Unaudited) 1995 1994
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income................................................ $ 2,125,233 $ 1,977,267
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization........................... 554,048 663,111
Provision for loan losses............................... 25,000 25,000
Gains on sale of investment securities, net............. 0 (407,081)
Net amortization & accretion of securities.............. 847,725 1,021,298
Net (increase) decrease in trading account.............. 0 0
Increase in other real estate owned..................... (662,364) (245,700)
(Increase) decrease in other assets..................... (477,807) (352,471)
Increase (decrease) in other liabilities................ 282,198 260,935
Net cash provided by operating activities............. 2,694,033 2,942,359
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of securities ................................ (17,972,937) (7,981,925)
Proceeds from maturities & calls of securities ......... 12,115,000 7,828,050
Proceeds from sales of securities ...................... 0 8,980,859
Loans made to customers................................. (64,952,268) (94,196,461)
Principal payments received on loans.................... 55,261,268 75,159,508
Proceeds from sales of other real estate owned.......... 118,700 716,110
Purchases of premises and equipment..................... (639,018) (154,958)
(Increase) decrease in federal funds sold............... (7,417,386) 1,901,854
Net cash provided by (used in) investing activities... (23,486,641) (7,746,963)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in non-interest bearing deposits.... 6,093,819 624,629
Increase (decrease) in savings deposits................. (933,565) (4,599,085)
Proceeds from the sale of certificates of deposit....... 56,103,912 44,919,472
Payments for maturing certificates of deposit........... (41,056,612) (38,008,247)
Increase (decrease) in federal funds purchased &
repurchase agreements.................................. (1,650,465) (727,720)
Increase (decrease) in other borrowed money............. 2,894,687 3,246,430
Proceeds from issuance of common stock.................. 88,195 163,355
Dividends paid.......................................... (573,091) (504,243)
Net cash provided by financing activities............. 20,966,880 5,114,591
Net increase (decrease) in cash and due from banks.... 174,272 309,987
Cash and due from banks at beginning of period........ 8,940,712 8,166,076
Cash and due from banks at end of period.............. $ 9,114,984 $ 8,476,063
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash payments for:
Interest.............................................. $ 6,683,301 5,502,269
Income taxes.......................................... $ 830,000 680,000
See accompanying notes
</TABLE>
<TABLE>
<CAPTION>
OLD POINT FINANCIAL CORPORATION
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(Unaudited)
Unrealized
Common Stock Undivided Gain/(Loss)
Shares Amount Surplus Profits On Securities Total
FOR NINE MONTHS ENDED SEPTEMBER 30, 1995
<S> <C> <C> <C> <C> <C> <C>
Balance at beginning of period.. 1,263,903 $6,319,515 $9,031,923 $12,793,050 ($1,923,349) $26,221,139
Net income...................... -- -- -- 2,125,232 -- 2,125,232
Sale of common stock............ 9,634 48,170 312,875 (272,850) -- 88,195
Cash dividends.................. -- -- -- (573,091) -- (573,091)
Decrease in unrealized loss
on securities................. -- -- -- -- 1,953,238 1,953,238
Balance at end of period........ 1,273,537 $6,367,685 $9,344,798 $14,072,341 $29,889 $29,814,713
FOR NINE MONTHS ENDED SEPTEMBER 30, 1994
Balance at beginning of period.. 1,254,285 $6,271,425 $8,738,143 $10,856,057 ($29,565) $25,836,060
Net income...................... -- -- -- 1,977,267 -- 1,977,267
Sale of common stock............ 6,998 34,990 209,940 (81,575) -- 163,355
Cash dividends.................. -- -- -- (504,241) -- (504,241)
Increase in unrealized loss
on securities................. -- -- -- -- (1,097,475) (1,097,475)
Balance at end of period........ 1,261,283 $6,306,415 $8,948,083 $12,247,508 ($1,127,040) $26,374,966
See accompanying notes
</TABLE>
OLD POINT FINANCIAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. The accounting and reporting policies of the Registrant
conform to generally accepted accounting principles and to the
general practices within the banking industry. The interim
financial statements have not been audited; however, in the opinion
of management, all adjustments necessary for a fair presentation of
the consolidated financial statements have been included. These
adjustments include estimated provisions for bonus, profit sharing
and pension plans that are settled at year-end. These financial
statements should be read in conjunction with the financial
statements included in the Registrant's 1994 Annual Report to
Shareholders and Form 10-KSB.
2. Earnings per common share outstanding are computed by
dividing income by the weighted average number of outstanding
common shares for each period presented.
<TABLE>
<CAPTION>
OLD POINT FINANCIAL CORPORATION
Parent only Balance Sheets September 30, December 31,
(Unaudited) 1995 1994
<S> <C> <C>
Assets
Cash in bank................................ $ 102,432 $ 154,143
Investment Securities....................... 1,665,599 1,437,584
Total Loans................................. 52,575 54,169
Investment in Subsidiary.................... 27,896,963 24,507,062
Equipment................................... 18,851 0
Other assets................................ 78,294 68,181
Total Assets................................ $ 29,814,714 $ 26,221,139
Liabilities and Stockholders' Equity
Total Liabilities........................... $ 0 $ 0
Stockholders' Equity........................ 29,814,714 26,221,139
Total Liabilities & Stockholders' Equity.... $ 29,814,714 $ 26,221,139
</TABLE>
<TABLE>
<CAPTION>
OLD POINT FINANCIAL CORPORATION Three Months Ended: Nine Months Ended:
Parent only Income Statements September 30, September 30,
(Unaudited) 1995 1994 1995 1994
<S> <C> <C> <C> <C>
Income
Cash dividends from Subsidiary.............. $ 250,000 $ 250,000 $ 750,000 $ 700,000
Interest and fees on loans.................. 1,121 1,166 3,397 3,528
Interest income from investment securities.. 24,841 18,000 71,273 42,439
Gains (losses) from sale of
investment securities................... 0 0 0 0
Other income................................ 0 0 0 0
Total Income................................ 275,962 269,166 824,670 745,967
Expenses
Salaries and employee benefits.............. 47,772 46,143 152,718 144,782
Other expenses.............................. 15,159 9,438 41,812 49,281
Total Expenses.............................. 62,931 55,581 194,530 194,063
Income before taxes & undistributed
net income of subsidiary................ 213,031 213,585 630,140 551,904
Income tax.................................. (12,500) (12,000) (40,700) (50,000)
Net income before undistributed
net income of subsidiary.................. 225,531 225,585 670,840 601,904
Undistributed net income of subisdiary...... 494,674 362,155 1,454,393 1,375,363
Net Income.................................. $ 720,205 $ 587,740 $ 2,125,233 $ 1,977,267
</TABLE>
<TABLE>
<CAPTION>
OLD POINT FINANCIAL CORPORATION Nine Months Ended:
Parent only Statements of Cash Flows September 30,
(Unaudited) 1995 1994
<S> <C> <C>
Cash Flows from Operating Activities:
Net Income.................................. $ 2,125,233 $ 1,977,267
Adjustments to reconcile net income to
net cash provided by operating activities:
Equity in undistributed income
of subsidiary....................... (1,454,393) (1,375,363)
Accretion on securities................ (7,636) 0
Depreciation........................... 2,072 0
Gains(losses) on sale of securities..... 0 0
(Increase) Decrease in other assets..... (19,248) 128,613
Increase (decrease in other liabilities) 0 0
Net cash provided by operating activities... 646,028 730,517
Cash flows from investing activities:
(Increase)decrease in investment securities. (193,514) (850,000)
Purchase of equipment....................... (20,923) 0
(Increase)/decrease in other
real estate owned....................... 0 435,000
Repayment of loans by customers............. 1,594 1,465
Net cash provided by investing activities... (212,843) (413,535)
Cash flows from financing activities:
Proceeds from issuance of common stock...... 88,195 163,355
Dividends paid.............................. (573,091) (504,243)
Net cash provided by financing activities... (484,896) (340,888)
Net increase (decrease) in
cash & due from banks................... (51,711) (23,906)
Cash & due from banks at beginning of period 154,143 132,382
Cash & due from banks at end of period...... $ 102,432 $ 108,476
</TABLE>
Item 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Summary
Net income for the third quarter of 1995 increased 23% to
$720,205 from $587,740 for the comparable period in 1994. Earnings
per share were $0.57 in the third quarter of 1995 compared with
$0.47 in 1994.
For the nine months ended September 30, 1995 net income
increased 7% to $2,125,232 from $1,977,267 in 1994. Earnings per
share were $1.67 for the first nine months of 1995 compared with
$1.57 in 1994.
Return on average assets was 0.97% for the third quarter of
1995 and 0.85% for the comparable period in 1994. Return on
average equity was 9.71% for the third quarter of 1995 and 8.81%
for the third quarter of 1994.
For the nine months ended September 30, 1995 and 1994 return
on average assets was 0.99% and 0.95% respectively. Return on
average equity was 9.91% in 1995 and 9.83% in 1994.
Net Interest Income
Net interest income, on a fully tax equivalent basis,
decreased $4,000, or 0.13%, for the third quarter of 1995 from
1994. Average earning assets increased 7.22% and the net interest
yield, defined as the ratio of net interest income on a fully tax
equivalent basis to total earning assets, declined from 4.72% in
1994 to 4.40% in 1995.
For the nine months ended September 30, 1995 net interest
income increased $297,000 or 3.33% over the comparable period in
1994. Average earning assets increased 3.88% and the net interest
yield decreased from 4.60% in 1994 to 4.58% in 1995.
The composition of average earning assets continued to change
during the first nine months of 1995. Average loans increased 12%,
average investment securities decreased 10%, and average Federal
Funds Sold increased 27%. Certificates of deposit increased 18%
while interest checking and savings accounts declined 6%.
Net interest income has also been negatively impacted by
nonperforming loans and loans charged off. The higher level of
nonperforming loans is expected to continue to depress the net
interest yield through the remainder of 1995. Page 9 shows an
analysis of average earning assets, interest bearing liabilities
and rates and yields.
<TABLE>
<CAPTION> _________________________________________ __________________________________________________________________
OLD POINT FINANCIAL CORPORATION
NET INTEREST INCOME ANALYSIS For the quarter ended September 30,
(Fully taxable equivalent basis) * 1995 1994
_________________________________________ ____________________________________ __________________________________
Dollars in thousands Average Average
Interest Rates Interest Rates
Average Income/ Earned/ Average Income/ Earned/
Balance Expense Paid Balance Expense Paid
_________________________________________ ____________________________________ ____________________________________
<S> <C> <C> <C> <C> <C> <C>
Loans (net of unearned income)**......... $182,264 $ 4,067 8.93% $168,022 $ 3,622 8.62%
Investment securities:***
Taxable................................ 80,255 1,215 6.06% 84,384 1,211 5.74%
Tax-exempt............................. 7,861 183 9.31% 5,962 145 9.73%
________ ________ ________ ________
Total investment securities.......... 88,116 1,398 6.35% 90,346 1,356 6.00%
Federal funds sold....................... 7,482 99 5.29% 794 8 4.03%
________ ________ ________ ________
Total earning assets................... $277,862 $5,564 8.01% $259,162 $4,986 7.70%
Time and savings deposits:
Interest-bearing transaction accounts.. $49,058 $325 2.65% $50,567 $335 2.65%
Money market deposit accounts.......... 19,836 197 3.97% 19,480 160 3.29%
Savings accounts....................... 26,188 181 2.76% 29,572 206 2.79%
Certificates of deposit,
$100,000 or more................... 14,633 208 5.69% 11,382 121 4.25%
Other certificates of deposit.......... 100,595 1,414 5.62% 84,506 969 4.59%
________ ________ ________ ________
Total time and savings deposits...... 210,310 2,325 4.42% 195,507 1,791 3.66%
Federal funds purchased and securities
sold under agreement to repurchase..... 11,499 144 5.01% 13,724 131 3.82%
Other short term borrowings.............. 2,368 39 6.59% 664 4 2.41%
________ ________ ________ ________
Total interest bearing liabilities..... $224,177 2,508 4.48% $209,895 1,926 3.67%
Net interest income/yield................ $3,056 4.40% $3,060 4.72%
===== ===== ===== =====
________________________________________________________________________________
For the nine months ended September 30,
1995 1994
____________________________________ ____________________________________
Average Average
Interest Rates Interest Rates
Average Income/ Earned/ Average Income/ Earned/
Balance Expense Paid Balance Expense Paid
_________________________________________ ____________________________________ ____________________________________
Loans (net of unearned income)**......... $178,835 $11,999 8.95% $159,952 $10,162 8.47%
Investment securities:***
Taxable................................ 77,732 3,463 5.94% 88,185 3,758 5.68%
Tax-exempt............................. 6,933 495 9.52% 6,404 482 10.04%
________ ________ ________ ________
Total investment securities.......... 84,665 3,958 6.23% 94,589 4,240 5.98%
Federal funds sold....................... 4,971 207 5.55% 3,905 100 3.41%
________ ________ ________ ________
Total earning assets................... $268,471 $16,164 8.03% $258,446 $14,502 7.48%
Time and savings deposits:
Interest-bearing transaction accounts.. $48,929 $964 2.63% $50,958 $993 2.60%
Money market deposit accounts.......... 19,197 565 3.92% 19,659 444 3.01%
Savings accounts....................... 26,763 549 2.74% 30,654 630 2.74%
Certificates of deposit,
$100,000 or more................... 13,350 542 5.41% 10,283 330 4.28%
Other certificates of deposit.......... 96,015 3,843 5.34% 82,179 2,808 4.56%
________ ________ ________ ________
Total time and savings deposits...... 204,254 6,463 4.22% 193,733 5,205 3.58%
Federal funds purchased and securities
sold under agreement to repurchase... 10,956 402 4.89% 15,390 373 3.23%
Other short term borrowings.............. 2,110 87 5.50% 278 9 4.32%
________ ________ ________ ________
Total interest bearing liabilities..... $217,320 6,952 4.27% $209,401 5,587 3.56%
Net interest income/yield................ $9,212 4.58% $8,915 4.60%
===== ===== ===== =====
* Tax equivalent yields based on 34% tax rate.
** Nonaccrual loans are included in the average loan balances and income on such loans is recognized on a cash basis
*** All investment securities are reported at amortized cost for this schedule.
</TABLE>
Provision/Allowance for Loan Losses
The provision for loan losses remained constant at $25,000 for
the first nine months of 1995 compared with the same period in
1994. Loans charged off (net of recoveries) were $15,422 in the
first nine months of 1995, compared to $149,314 for the same period
in 1994. On an annualized basis net loan charge-offs for the first
nine months of 1995 were 0.01% of total loans at period end
compared with 0.12% for the same period in 1994 and 0.85% for the
full year of 1994.
On September 30, 1995 nonperforming assets totalled $4.75
million compared with $3.57 million on September 30, 1994. The
September 1995 total consisted of $403 thousand in foreclosed real
estate, $354 thousand in a former branch site now offered for sale,
and $3.99 million in nonaccrual loans. The September 1994 total
consisted of $395 thousand in foreclosed real estate and $3.17
million in nonaccrual loans. Loans still accruing interest but
past due 90 days or more increased to $1.0 million as of September
30, 1995 compared with $128 thousand on September 30, 1994.
The allowance for loan losses on September 30, 1995 was $2.7
million. It represented a multiple of 0.56 times nonperforming
assets and 0.67 times nonperforming loans. The allowance for loan
losses on September 30, 1995 was 1.45% of loans (net of unearned
income) compared to 1.52% at September 30, 1994.
Other Income
Other income increased $98,477, or 12%, for the third quarter
of 1995 over the same period in 1994. The increase in 1995
resulted primarily from increased deposit and trust department fees
as well as mortgage brokerage income.
For the nine months ended September 30, 1995 other income
decreased $252,312, or 8%, from 1994, primarily as a result of
security gains in the first quarter of 1994.
Other Expenses
Other expenses decreased $109,364, or 4%, in the third quarter
of 1995 from 1994. While salary expense increased slightly all
categories of other expenses decreased. The Bank received a
$146,187 FDIC insurance refund in September 1995, covering the
period June through September 1995.
For the nine months ended September 30, 1995 other expenses
decreased $185,163, or 2%, from 1994. The 1995 expenses reflect
lower loan administration and FDIC insurance expenses.
Regulatory approval has been obtained for the relocation of
our Sherwood branch office approximately one half mile from its
present location during the fourth quarter 1995. Also, regulatory
approval has been granted to open a new full service branch office
in the Kiln Creek area of York County. It is anticipated that this
branch will open in the first half of 1996. The Company also plans
to construct a 15,000 square foot building in the Oyster Point area
of Newport News to house Trust, Commercial and Real Estate Loans,
and a branch office. This building is scheduled to be occupied in
late 1996.
Financial Condition
At September 30, 1995 total assets were $303.0 million, up 9%
from $277.7 million at December 31, 1994. Total loans grew $9.7
million, or 6%, while investment securities and federal funds sold
increased $15.3 million, or 18%, in 1995. Total deposits grew
$20.2 million, or 9% in 1995; while repurchase agreements, used as
a cash management vehicle by commercial customers, declined $1.6
million, or 12%.
Capital Resources
The Company's capital position remains strong as evidenced by
the regulatory capital measurements. At September 30, 1995 the
Tier I capital ratio was 15.8%, the total capital ratio was 17.1%,
and the leverage ratio was 9.9%. These ratios were all well above
the regulatory minimum levels of 4.00%, 8.00%, and 3.00%,
respectively.
Liquidity and Interest Sensitivity
Liquidity is the ability of the Company to meet present and
future obligations to depositors and borrowers. As loan demand
increases, liquidity will be provided by liquidation of short term
investment securities as well as other means of financing such as
purchase of federal funds and demand note to the US Treasury.
The Company was liability sensitive as of September 30, 1995.
There were $77.5 million more in liabilities than assets subject to
repricing within three months. If interest rates rise, net
interest income should decline. It should be noted, however, that
the savings deposits; which consist of interest checking, money
market, and savings accounts; are less interest sensitive than
other market driven deposits. In a rising rate environment these
deposit rates have historically lagged behind the changes in
earning asset rates, thus mitigating somewhat the impact from the
liability sensitivity position. Conversely, net interest income
should improve if interest rates fall since liabilities will
reprice faster than assets. The table on page 12 reflects the
earlier of the maturity or repricing data for various assets and
liabilities as of September 30, 1995.
<TABLE>
<CAPTION>
INTEREST SENSITIVITY ANALYSIS
As of September 30, 1995 MATURITY
(in thousands) Within 4-12 1-5 Over 5
3 Months Months Years Years Total
Uses of funds
<S> <C> <C> <C> <C> <C>
Federal funds sold.............. 7,664 -- -- -- 7,664
Taxable investments............. 9,322 14,195 48,265 9,990 81,772
Tax-exempt investments.......... 100 446 1,939 7,124 9,609
Total investments............. 17,086 14,641 50,204 17,114 99,045
Loans:
Commercial.................... 28,310 1,881 18,598 960 49,749
Tax-exempt.................... 3,156 21 368 688 4,233
Installment................... 95 1,326 45,212 1,199 47,832
Real estate................... 10,141 3,763 56,650 10,471 81,025
Other......................... 608 -- -- -- 608
Total loans..................... 42,310 6,991 120,828 13,318 183,447
Total earning assets............ 59,396 21,632 171,032 30,432 282,492
Sources of funds
Interest checking deposits...... 50,637 -- -- -- 50,637
Money market deposit accounts... 19,878 -- -- -- 19,878
Regular savings accounts........ 25,537 -- -- -- 25,537
Certificates of deposit.........
$100,000 or more.............. 3,750 7,635 3,553 -- 14,938
Other time deposits............. 22,110 48,301 31,184 42 101,637
Federal funds purchased and
securities sold under
agreements to repurchase...... 11,032 1,012 -- -- 12,044
Other borrowed money............ 4,000 -- 57 -- 4,057
Total interest bearing liabiliti 136,944 56,948 34,794 42 228,728
Rate sensitivity GAP............ (77,548) (35,316) 136,238 30,390 53,764
Cumulative GAP.................. (77,548) (112,864) 23,374 53,764
</TABLE>
PART II - OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) not applicable
(b) No reports on Form 8-K were filed during the third
quarter of 1995.
SIGNATURES
In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
OLD POINT FINANCIAL CORPORATION
October 20, 1995
By: /s/Robert F. Shuford
President and Director
Principal Executive Officer
By: /s/Louis G. Morris
Senior Vice President and Treasurer
Principal Financial and Accounting Officer
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<CASH> 9115
<INT-BEARING-DEPOSITS> 212626
<FED-FUNDS-SOLD> 7664
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 73308
<INVESTMENTS-CARRYING> 18118
<INVESTMENTS-MARKET> 18236
<LOANS> 183447
<ALLOWANCE> 2656
<TOTAL-ASSETS> 303007
<DEPOSITS> 255806
<SHORT-TERM> 4000
<LIABILITIES-OTHER> 1285
<LONG-TERM> 57
<COMMON> 6368
0
0
<OTHER-SE> 23447
<TOTAL-LIABILITIES-AND-EQUITY> 303007
<INTEREST-LOAN> 11886
<INTEREST-INVEST> 3790
<INTEREST-OTHER> 207
<INTEREST-TOTAL> 15883
<INTEREST-DEPOSIT> 6463
<INTEREST-EXPENSE> 6952
<INTEREST-INCOME-NET> 8931
<LOAN-LOSSES> 25
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 8805
<INCOME-PRETAX> 2957
<INCOME-PRE-EXTRAORDINARY> 2957
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2125
<EPS-PRIMARY> 1.67
<EPS-DILUTED> 1.67
<YIELD-ACTUAL> 4.4
<LOANS-NON> 3991
<LOANS-PAST> 1014
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 3234
<ALLOWANCE-OPEN> 2647
<CHARGE-OFFS> 407
<RECOVERIES> 391
<ALLOWANCE-CLOSE> 2656
<ALLOWANCE-DOMESTIC> 2656
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 413
</TABLE>
