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 June 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) 722-7451
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 July 15, 1995.
Class Outstanding at July 15, 1995
Common Stock, $5.00 par value 1,273,537 shares
<PAGE>
OLD POINT FINANCIAL CORPORATION
FORM 10-Q
INDEX
PART I - FINANCIAL INFORMATION
Page
Item 1. Financial Statements . . . . . . . . . . . . . . .1
Consolidated Balance Sheets
June 30, 1995 and December 31, 1994. . . . . . 1
Consolidated Statement of Earnings
Three months ended June 30, 1995 and 1994 . . 2
Six months ended June 30, 1995 and 1994. . . . .2
Consolidated Statement of Cash Flows
Six months ended June 30, 1995 and 1994 . . . 3
Consolidated Statements of Changes in Stockholders' Equity
Six months ended June 30, 1995 and 1994 . . . 4
Notes to Consolidated Financial Statements . . . . 5
Parent Only Balance Sheets
June 30, 1995 and December 31, 1994 . . . 6
Parent Only Statement of Earnings
Three months ended June 30, 1995 and 1994 6
Six months ended June 30, 1995 and 1994 . .6
Parent Only Statement of Cash Flows
Three months ended June 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 . . . . . . . . 13
(i)
<PAGE>
PART 1. - FINANCIAL INFORMATION
<TABLE>
OLD POINT FINANCIAL CORPORATION
<CAPTION>
Consolidated Balance Sheets June 30 December 31,
(Unaudited) 1995 1994
Assets
<S> <C> <C>
Cash and due from banks........................ $ 9,821,667 $ 8,940,712
Securities available for sale, at market....... 77,788,225 82,598,958
Securities to be held to maturity.............. 9,911,013 919,141
Trading account securities..................... -- --
Federal funds sold............................. 10,271,766 246,900
Loans, total (excluding unearned income)....... 180,274,887 173,740,982
Less reserve for loan losses............... 2,725,467 2,646,692
Net loans.............................. 177,549,420 171,094,290
Bank premises and equipment.................... 7,598,259 7,432,994
Other real estate owned........................ 628,864 213,700
Other assets................................... 5,490,609 6,232,817
Total assets.............................. $299,059,823 $277,679,512
Liabilities
Noninterest-bearing deposits................... $ 44,508,730 $ 37,086,440
Savings deposits............................... 96,393,701 96,985,612
Time deposits.................................. 112,424,956 101,527,085
Total deposits.............................. 253,327,387 235,599,137
Federal funds purchased and securities sold
under agreement to repurchase............... 11,106,443 13,694,007
Interest-bearing demand notes issued to the
United Treasury and other liabilities
for borrowed money.......................... 4,060,432 1,162,240
Other liabilities.............................. 1,316,720 1,002,989
Total liabilities........................... 269,810,982 251,458,373
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.............................. 13,543,166 12,793,050
Unrealized gain/(loss) on securities .......... (6,808) (1,923,349)
Total stockholders' equity................. 29,248,841 26,221,139
Total liabilities and stockholders' equity. $299,059,823 $277,679,512
See accompanying notes
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
OLD POINT FINANCIAL CORPORATION Three Months Ended Six Months Ended
Consolidated Statements of Earnings June 30, June 30,
(Unaudited) 1995 1994 1995 1994
Interest Income
<S> <C> <C> <C> <C>
Interest and fees on loans..................... $3,951,905 $3,338,237 $ 7,846,481 $6,462,362
Interest on federal funds sold................. 66,076 47,306 107,519 91,534
Interest on securities:
Taxable..................................... 1,149,589 1,258,289 2,248,406 2,547,103
Exempt from federal income tax.............. 102,473 108,953 205,835 222,107
Interest on trading account securities......... 0 0 0 0
Total interest on securities............. 1,252,062 1,367,242 2,454,241 2,769,210
Total interest income...................... 5,270,043 4,752,785 10,408,241 9,323,106
Interest Expense
Interest on savings deposits................... 690,889 694,466 1,375,582 1,366,367
Interest on time deposits...................... 1,473,008 999,992 2,762,002 2,042,238
Interest on federal funds purchased and
securities sold under agreement
to repurchase................................ 126,347 139,957 258,430 242,567
Interest on demand notes (note balances) issued
to the United States Treasury and on
other borrowed money......................... 20,813 1,516 48,161 3,158
Total interest expense..................... 2,311,057 1,835,931 4,444,175 3,654,330
Net interest income............................ 2,958,986 2,916,854 5,964,066 5,668,776
Provision for loan losses...................... 0 0 25,000 25,000
Net interest income after provision for
loan losses.................................. 2,958,986 2,916,854 5,939,066 5,643,776
Other Income
Income from fiduciary activities............... 379,255 322,911 719,676 629,626
Service charges on deposit accounts............ 493,135 441,960 958,627 860,495
Other service charges, commissions and fees.... 51,494 90,163 96,741 194,070
Other operating income......................... 28,283 49,937 132,999 164,516
Income from trading account.................... 0 0 0 0
Security gains (losses)........................ 0 1,122 0 410,125
Total other income......................... 952,167 906,093 1,908,043 2,258,832
Other Expenses
Salaries and employee benefits................. 1,775,715 1,720,357 3,545,406 3,503,491
Occupancy expense of Bank premises............. 177,560 165,448 348,261 346,607
Furniture and equipment expense................ 222,199 282,026 456,542 579,120
Other operating expenses....................... 798,201 738,096 1,565,073 1,561,863
Total other expenses....................... 2,973,675 2,905,927 5,915,282 5,991,081
Income before taxes............................ 937,478 917,020 1,931,827 1,911,527
Applicable income taxes ....................... 266,800 244,000 526,800 522,000
Net income..................................... $ 670,678 $ 673,020 $ 1,405,027 $1,389,527
Per Share
Based on weighted average number of
common shares outstanding.................... 1,273,537 1,260,912 1,270,936 1,258,575
Net income..................................... $ 0.53 $ 0.53 $ 1.11 $ 1.10
See accompanying notes
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
OLD POINT FINANCIAL CORPORATION Six Months Ended
Consolidated Statements of Cash Flows June 30,
(Unaudited) 1995 1994
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income................................................ $ 1,405,027 $ 1,389,527
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization........................... 365,966 446,194
Provision for loan losses............................... 25,000 25,000
Gains on sale of investment securities, net............. 0 (410,125)
Net amortization & accretion of securities
available for sale.................................... 591,176 684,113
Net (increase) decrease in trading account.............. 0 0
Increase in other real estate owned..................... (443,864) (135,700)
(Increase) decrease in other assets
(net of tax effect of FASB 115 adjustment)............ (245,103) (263,341)
Increase (decrease) in other liabilities................ 313,731 194,822
Net cash provided by operating activities............. 2,011,933 1,930,489
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of securities available for sale.............. (9,268,464) (7,154,688)
Proceeds from maturities & calls of securities
available for sale.................................... 7,400,000 6,200,000
Proceeds from sales of securities available for sale.... 0 6,982,891
Loans made to customers................................. (10,470,073) (66,196,211)
Principal payments received on loans.................... 3,989,943 51,862,271
Proceeds from sales of other real estate owned.......... 28,700 657,110
Purchases of premises and equipment..................... (531,231) (115,116)
(Increase) decrease in federal funds sold............... (10,024,866) 4,338,338
Net cash provided by (used in) investing activities... (18,875,991) (3,425,404)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in non-interest bearing deposits.... 7,422,290 3,245,617
Increase (decrease) in savings deposits................. (591,911) (240,566)
Proceeds from the sale of certificates of deposit....... 37,775,818 23,349,716
Payments for maturing certificates of deposit........... (26,877,947) (26,510,230)
Increase (decrease) in federal funds purchased &
repurchase agreements.................................. (2,587,564) 2,940,156
Increase (decrease) in other borrowed money............. 2,898,192 (12,180)
Proceeds from issuance of common stock.................. 88,195 163,355
Dividends paid.......................................... (382,060) (315,050)
Net cash provided by financing activities............. 17,745,013 2,620,818
Net increase (decrease) in cash and due from banks.... 880,955 1,125,903
Cash and due from banks at beginning of period........ 8,940,712 8,166,076
Cash and due from banks at end of period.............. $ 9,821,667 $ 9,291,979
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash payments for:
Interest.............................................. $ 4,285,987 3,655,382
Income taxes.......................................... $ 480,000 430,000
See accompanying notes
</TABLE>
<PAGE>
<TABLE>
OLD POINT FINANCIAL CORPORATION
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(Unaudited)
<CAPTION> Unrealized
Common Stock Undivided Gain/(Loss)
Shares Amount Surplus Profits On Securities Total
FOR SIX MONTHS ENDED JUNE 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...................... -- -- -- 1,405,027 -- 1,405,027
Sale of common stock............ 9,634 48,170 312,875 (272,850) -- 88,195
Cash dividends.................. -- -- -- (382,061) -- (382,061)
Decrease in unrealized loss
on securities................. -- -- -- -- 1,916,541 1,916,541
Balance at end of period........ 1,273,537 $6,367,685 $9,344,798 $13,543,166 ($6,808) $29,248,841
FOR SIX MONTHS ENDED JUNE 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...................... -- -- -- 1,389,527 -- 1,389,527
Sale of common stock............ 6,998 34,990 209,940 (81,575) -- 163,355
Cash dividends.................. -- -- -- (315,050) -- (315,050)
Increase in unrealized loss
on securities................. -- -- -- -- (750,069) (750,069)
Balance at end of period........ 1,261,283 $6,306,415 $8,948,083 $11,848,959 ($779,634) $26,323,823
</TABLE>
<PAGE>
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-K.
2. Earnings per common share outstanding are computed by dividing
income by the weighted average number of outstanding common
shares for each period presented.
<PAGE>
<TABLE>
OLD POINT FINANCIAL CORPORATION
<CAPTION>
Parent only Balance Sheets June 30, December 31,
(Unaudited) 1995 1994
Assets
<S> <C> <C>
Cash in bank................................ $ 102,617 $ 154,143
Investment Securities....................... 1,636,813 1,437,584
Total Loans................................. 53,117 54,169
Investment in Subsidiary.................... 27,365,591 24,507,062
Equipment................................... 19,739 --
Other assets................................ 70,964 68,181
Total Assets................................ $ 29,248,841 $ 26,221,139
Liabilities and Stockholders' Equity
Total Liabilities........................... $ 0 $ 0
Stockholders' Equity........................ 29,248,841 26,221,139
Total Liabilities & Stockholders' Equity.... $ 29,248,841 $ 26,221,139
</TABLE>
<TABLE>
<CAPTION>
OLD POINT FINANCIAL CORPORATION Three Months Ended: Six Months Ended:
Parent only Income Statements June 30, June 30,
(Unaudited) 1995 1994 1995 1994
Income
<S> <C> <C> <C> <C>
Cash dividends from Subsidiary.............. $ 250,000 $ 225,000 $ 500,000 $ 450,000
Interest and fees on loans.................. 1,132 1,176 2,276 2,362
Interest income from investment securities.. 25,251 16,154 46,432 24,439
Gains (losses) from sale of
investment securities..................... 0 0 0 0
Other income................................ 0 0 0 0
Total Income................................ 276,383 242,330 548,708 476,801
Expenses
Salaries and employee benefits.............. 48,918 46,459 104,946 98,639
Other expenses.............................. 16,519 16,985 26,653 39,843
Total Expenses.............................. 65,437 63,444 131,599 138,482
Income before taxes & undistributed
net income of subsidiary................ 210,946 178,886 417,109 338,319
Income tax.................................. (13,200) (16,000) (28,200) (38,000)
Net income before undistributed
net income of subsidiary.................. 224,146 194,886 445,309 376,319
Undistributed net income of subisdiary...... 446,532 478,134 959,718 1,013,208
Net Income.................................. $ 670,678 $ 673,020 $ 1,405,027 $ 1,389,527
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
OLD POINT FINANCIAL CORPORATION Six Months Ended:
Parent only Statements of Cash Flows June 30,
(Unaudited) 1995 1994
Cash Flows from Operating Activities:
<S> <C> <C>
Net Income.................................. $ 1,405,027 $ 1,389,527
Adjustments to reconcile net income to
net cash provided by operating activities:
Equity in undistributed income of
subsidiary............................ (959,718) (1,013,208)
Depreciation........................... 1,184 0
Gains(losses) on sale of securities..... 0 0
(Increase) Decrease in other assets..... (11,918) 82,472
Increase (decrease in other liabilities) 0 0
Net cash provided by operating activities... 434,575 458,791
Cash flows from investing activities:
(Increase)decrease in investment securities. (172,364) (850,000)
Purchase of equipment....................... (20,923) 0
(Increase)/decrease in other real
estate owned.............................. 0 435,000
Repayment of loans by customers............. 1,052 967
Net cash provided by investing activities... (192,235) (414,033)
Cash flows from financing activities:
Proceeds from issuance of common stock...... 88,195 163,355
Dividends paid.............................. (382,061) (315,050)
Net cash provided by financing activities... (293,866) (151,695)
Net increase (decrease) in cash & due
from banks................................ (51,526) (106,937)
Cash & due from banks at beginning of period 154,143 132,382
Cash & due from banks at end of period...... $ 102,617 $ 25,445
</TABLE>
<PAGE>
Item 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Summary
Net income for the second quarter of 1995 decreased 0.3% to
$670,678 from $673,020 for the comparable period in 1994. Earnings
per share were $0.53 in the second quarter of 1995 and 1994.
For the six months ended June 30, 1995 net income increased
1% to $1,405,027 from $1,389,527 in 1994. Earnings per share were
$1.11 for the first six months of 1995 compared with $1.10 in 1994.
Return on average assets was 0.94% for the second quarter of
1995 and 0.96% for the comparable period in 1994. Return on
average equity was 9.28% for the second quarter of 1995 and 10.09%
for the second quarter of 1994.
For the six months ended June 30, 1995 and 1994 return on
average assets was 0.99% and 1.00% respectively. Return on average
equity was 10.01% in 1995 and 10.18% in 1994.
Net Interest Income
Net interest income, on a fully tax equivalent basis,
increased $61 thousand, or 2%, for the second quarter of 1995 over
1994. Average earning assets increased 4% and the net interest
yield, defined as the ratio of net interest income on a fully tax
equivalent basis to total earning assets, decreased from 4.62% in
1994 to 4.55% in 1995.
For the six months ended June 30, 1995 net interest income
increased $295 thousand, or 5%, over the comparable period in 1994.
Average earning assets increased 2% and the net interest yield
increased from 4.55% in 1994 to 4.67% in 1995.
The composition of average earning assets and interest bearing
liabilities continued to change during the first half of 1995.
Average loans increased 13% while average federal funds sold and
average investment securities decreased 32% and 14% respectively.
The Company continues to reduce investments to fund loans. Average
certificates of deposit increased 17% while average interest
checking and average savings accounts decreased 7%. As interest
rates on certificates rise, customers are shifting funds from
savings accounts to certificates.
Net interest income continues to be negatively impacted by
nonperforming loans. 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.
<PAGE>
<TABLE>
OLD POINT FINANCIAL CORPORATION
<CAPTION>
NET INTEREST INCOME ANALYSIS For the quarter ended June 30,
(Fully taxable equivalent basis) * 1995 1994
Average Average
Interest Rates Interest Rates
Average Income/ Earned/ Average Income/ Earned/
Dollars in thousands Balance Expense Paid Balance Expense Paid
<S> <C> <C> <C> <C> <C> <C>
Loans (net of unearned income)**... $176,086 $3,997 9.08% $160,003 $3,378 8.44%
Investment securities:
Taxable.......................... $79,169 1,150 5.81% $87,883 1,258 5.73%
Tax-exempt....................... $9,217 157 6.81% $6,542 165 10.09%
Total investment securities.... 88,386 1,307 5.91% 94,425 1,423 6.03%
Federal funds sold................. $4,489 66 5.88% $5,339 45 3.37%
Total earning assets............. $268,961 $5,370 7.99% $259,767 $4,846 7.46%
Time and savings deposits:
Interest-bearing transaction
accounts....................... $48,701 $320 2.63% $51,605 $334 2.59%
Money market deposit accounts.... 19,036 188 3.95% 20,039 148 2.95%
Savings accounts................. 26,778 183 2.73% 31,057 212 2.73%
Certificates of deposit,
$100,000 and over.............. 13,069 178 5.45% 9,654 98 4.06%
Other certificates of deposit.... 96,115 1,295 5.39% 80,709 909 4.51%
Total time and savings deposits 203,699 2,164 4.25% 193,064 1,701 3.52%
Federal funds purchased and
securities sold under agreement
to repurchase.................. 10,201 126 4.94% 17,504 146 3.34%
Other short term borrowings........ 1,938 21 4.33% 82 1 4.88%
Total interest bearing
liabilities.................... $215,838 2,311 4.28% $210,650 1,848 3.51%
Net interest income/yield.......... $3,059 4.55% $2,998 4.62%
For the six months ended June 30,
1995 1994
Average Average
Interest Rates Interest Rates
Average Income/ Earned/ Average Income/ Earned/
Dollars in thousands Balance Expense Paid Balance Expense Paid
Loans (net of unearned income)**... $177,132 $7,932 8.96% $156,069 $6,540 8.38%
Investment securities:
Taxable.......................... 74,900 2,248 6.00% 89,727 2,547 5.68%
Tax-exempt....................... 7,946 312 7.85% 6,624 337 10.18%
Total investment securities.... 82,846 2,560 6.18% 96,351 2,884 5.99%
Federal funds sold................. 3,715 $108 5.81% 5,461 $92 3.37%
Total earning assets............. $263,693 $10,600 8.04% $257,881 $9,516 7.38%
Time and savings deposits:
Interest-bearing transaction
accounts....................... $48,864 $639 2.62% $51,038 $658 2.58%
Money market deposit accounts.... 18,877 368 3.90% 19,865 284 2.86%
Savings accounts................. 27,051 368 2.72% 31,194 424 2.72%
Certificates of deposit,
$100,000 and over.............. 12,709 334 5.26% 9,734 198 4.07%
Other certificates of deposit.... 93,725 2,429 5.18% 81,462 1,845 4.53%
Total time and savings deposits 201,226 4,138 4.11% 193,293 3,409 3.53%
Federal funds purchased and
securities sold under agreement
to repurchase.................... 10,683 258 4.83% 16,224 243 3.00%
Other short term borrowings........ 1,982 48 4.84% 85 3 7.06%
Total interest bearing
liabilities.................... $213,891 4,444 4.16% $209,602 3,655 3.49%
Net interest income/yield.......... $6,156 4.67% $5,861 4.55%
* Tax equivalent yields based on 34% tax rate.
** Nonaccrual loans are included in the average loan balances and income on such loans is recogniz
</TABLE>
<PAGE>
Provision/Allowance for Loan Losses
The provision for loan losses remained constant for the first
six months of 1995 over the comparable period in 1994. Loan
recoveries (net of charge-offs) were $53,775 in the first six
months of 1995, compared with recoveries (net of charge-offs) of
$213,463 for the same period in 1994. On an annualized basis net
loan charge-offs were (0.06%) of total loans for the first half of
1995 compared with (0.26%) for the same period in 1994.
On June 30, 1995 nonperforming assets totalled $3.2 million
compared with $4.7 million on June 30, 1994. The June 1995 total
consisted of $275 thousand in foreclosed real estate, $354 thousand
in a former branch site now listed for sale, and $2.6 million in
nonaccrual loans. The June 1994 total consisted of $344 thousand
in foreclosed real estate and $4.4 million in nonaccrual loans.
Loans still accruing interest but past due 90 days or more
increased to $880 thousand as of June 30, 1995 compared with $132
thousand on June 30, 1994.
The allowance for loan losses on June 30, 1995 was $2.7 million.
It represented a multiple of 0.85 times nonperforming assets and
1.06 times nonperforming loans. The allowance for loan losses on
June 30, 1995 was 1.51% of loans compared to 1.78% at June 30,
1994.
Other Income
Other income increased $46,074, or 5%, for the second quarter
of 1995 over the same period in 1994. Income from fiduciary
activities increased 17% over the prior year, income from service
charges, commissions, and fees declined 43% for the same period due
to reduced mortgage brokerage income, and service charges on
deposits increased 12%.
For the six months ended June 30, 1995 other income decreased
$350,789 or 16% from 1994. The higher income in 1994 was primarily
a result of security gains in the first quarter of 1994.
Other Expenses
Other expenses increased $67,748, or 2%, in the second quarter
of 1995 over 1994. Salaries and employees benefits increased 3%
due to normal increases in pay. Furniture and equipment expense
decreased $59,827, or 21%, due to lower depreciation and the
cancellation of service contracts on certain computer equipment.
This decrease was offset by an increase of $60,105, or 8%, in
operating expenses that was primarily due to increased costs for
postage and stationery and supplies.
For the six months ended June 30, 1995 other expenses
decreased $75,799 or 1%, over 1994, primarily due to decreased
depreciation expense and the cancellation of service contracts on
certain computer equipment.
The Company has entered into a contract to replace its
mainframe computer, proof of deposit, and teller systems. These
conversions, scheduled for the fall of 1995, should enhance
operating efficiencies and customer service. These capital
expenditures will increase the Company's depreciation expense but
will reduce maintenance costs associated with data processing. The
Company has received approval from the Office of the Comptroller of
the Currency to open a new branch near the intersection of Kiln
Creek Parkway and Victory Boulevard. The branch opening is
scheduled for the first quarter of 1996.
<PAGE>
Financial Condition
At June 30, 1995 total assets were $299.1 million, up from
$277.7 million at December 31, 1994. Total loans grew $6.5
million, or 4% and investment securities and federal funds sold
grew $14.2 million, or 17%, in 1995. Loan demand continues to
strengthen but has not kept up with deposit growth. Total deposits
increased $17.7 million, or 8% in 1995 while federal funds
purchased and repurchase agreements decreased $2.6 million, or 19%.
Capital Resources
The Company's capital position remains strong as evidenced by
the regulatory capital measurements. At June 30, 1995 the Tier I
capital ratio was 14.98%, the total capital ratio was 16.24% and
the leverage ratio was 9.57%. 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 June 30, 1995.
There were $74.1 million more in liabilities than assets subject to
repricing within three months. Net interest income should improve
if interest rates fall since liabilities will reprice faster than
assets. Conversely, 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. The table on page 12 reflects the earlier of the
maturity or repricing data for various assets and liabilities as of
June 30, 1995.
<PAGE>
<TABLE>
INTEREST SENSITIVITY ANALYSIS
<CAPTION>
As of June 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.............. 10,272 -- -- -- 10,272
Taxable investments............. 9,166 14,452 49,425 1,941 74,984
Tax-exempt investments.......... 0 357 1,130 5,188 6,675
Total investments............. 19,438 14,809 50,556 7,129 91,932
Loans:
Commercial.................... 26,410 1,963 18,452 955 47,780
Tax-exempt.................... 3,231 27 183 922 4,364
Installment................... 121 1,179 43,953 569 45,822
Real estate................... 11,424 4,136 54,499 9,344 79,403
Other......................... 351 -- -- -- 351
Total loans..................... 41,538 7,305 117,087 11,790 177,720
Total earning assets............ 60,976 22,113 167,643 18,919 269,651
Sources of funds
Interest checking deposits...... 49,850 -- -- -- 49,850
Money market deposit accounts... 19,745 -- -- -- 19,745
Regular savings accounts........ 26,798 -- -- -- 26,798
Certificates of deposit.........
$100,000 or more.............. 5,370 5,470 2,948 -- 13,788
Other time deposits............. 19,652 39,365 39,581 37 98,635
Federal funds purchased and
securities sold under
agreements to repurchase...... 9,709 1,397 -- -- 11,106
Other borrowed money............ 4,000 -- 60 -- 4,060
Total interest bearing
liabilities................... 135,124 46,232 42,589 37 223,982
Rate sensitivity GAP............ (74,148) (24,119) 125,054 18,882 45,669
Cumulative GAP.................. (74,148) (98,266) 26,787 45,669
</TABLE>
<PAGE>
PART II - OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) none
(b) A filing was made on Form 8-K on April 25, 1995
regarding approval by stockholders of an increase
in authorized shares from 3,000,000 to 6,000,000.
<PAGE>
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
July 31, 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
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<CASH> 9,821,667
<INT-BEARING-DEPOSITS> 208,818,657
<FED-FUNDS-SOLD> 10,271,766
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 77,788,225
<INVESTMENTS-CARRYING> 9,911,013
<INVESTMENTS-MARKET> 9,964,507
<LOANS> 180,274,887
<ALLOWANCE> 2,725,467
<TOTAL-ASSETS> 299,059,823
<DEPOSITS> 253,327,387
<SHORT-TERM> 15,166,875
<LIABILITIES-OTHER> 1,316,720
<LONG-TERM> 0
<COMMON> 6,367,685
0
0
<OTHER-SE> 22,881,156
<TOTAL-LIABILITIES-AND-EQUITY> 299,059,823
<INTEREST-LOAN> 7,846,481
<INTEREST-INVEST> 2,454,241
<INTEREST-OTHER> 107,519
<INTEREST-TOTAL> 10,408,241
<INTEREST-DEPOSIT> 4,137,584
<INTEREST-EXPENSE> 4,444,175
<INTEREST-INCOME-NET> 5,964,066
<LOAN-LOSSES> 25,000
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 5,915,282
<INCOME-PRETAX> 1,931,827
<INCOME-PRE-EXTRAORDINARY> 1,405,027
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,405,027
<EPS-PRIMARY> 1.11
<EPS-DILUTED> 1.11
<YIELD-ACTUAL> 7.99
<LOANS-NON> 2,577,553
<LOANS-PAST> 880,242
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 5,126,705
<ALLOWANCE-OPEN> 2,646,692
<CHARGE-OFFS> 236,781
<RECOVERIES> 290,556
<ALLOWANCE-CLOSE> 2,745,467
<ALLOWANCE-DOMESTIC> 1,635,044
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 1,090,423
</TABLE>
