Benchmark Bankshares, Inc. Reports Earnings for Three and Nine Months Ended September 30, 2022

October 28, 2022 - Benchmark Bankshares, Inc. (BMBN), the Kenbridge-based holding company for Benchmark Community Bank, announced unaudited earnings of $4,105,285 for the third quarter of 2022, representing a 22.80% increase over the $3,343,121 earned during the third quarter of 2021. Earnings per share increased from $0.74 to $0.91, an increase of 23.10% for the quarter. Net income through the first nine months of the year amounted to $9,300,817, a 5.22% increase from the $8,839,538 earned through the first nine months of 2021, while earnings per share increased by 5.45%, climbing from $1.95 to $2.06.

Notable Items:

  • The bank closed on the purchase of a branch office from First Community Bank in Emporia, VA during September, adding approximately 3,000 customers and $60 million in deposits. For accounting purposes, the branch acquisition was a bargain purchase, which resulted in a one-time gain of $679,809.
  • Net interest income grew from $24.6 million to $27.6 million, an increase of 12.36%, when comparing the first nine months of 2022 to the same period last year.
  • Noninterest income decreased from $6.4. million to $6.2 million. The bank’s residential mortgage demand has softened due to increasing interest rates, reducing fee income on mortgage loans sold from $1.5 million to $911,608 through the first nine months of the year.
  • Overall loan demand has remained strong during the year. Total loans held for investment have increased by $136.7 million year-to-date, allowing the bank to offset the $1.9 million earned with the Paycheck Protection Program last year.
  • The investment portfolio has increased by $91.3 million year-to-date, generating an additional $1.3 million in income through the third quarter when compared to the same period last year.
  • The bank does not currently hold any foreclosed property and has not incurred any expenses related to foreclosed property year-to-date, compared to $212,165 in expenses incurred through the first nine months of last year. In addition, non-accrual loans amounted to $654,269 as of September 30, 2022, compared to $573,740 one year ago.
  • Net charge-offs for the first nine months of the year amounted to $62,405 compared to just $18,745 charged off in the first nine months of 2021.
  • A total of $559,017 was provisioned to the loan loss reserve during the first nine months of 2022, compared to a provision of $330,384 during the same period last year. The allowance for loan losses as a percentage of net loans was 0.82% on September 30, 2022, compared to 0.90% last September.
  • Interest expense on borrowings, used to support the company’s stock repurchase program, amounted to $98,412 year-to-date compared to a cost of $145,341 last year.
  • A total of 6,550 shares, at a price of $24.00 per share, has been repurchased year-to-date. A total of 30,728 shares were repurchased at an average price of $19.10 during the first nine months of 2021. Total shares outstanding as of September 30, 2022, amounted to 4,515,830.

As of September 30, 2022, total assets were $1.13 billion, an increase of $137.8 million, or 13.89%, over the September 30, 2021, balance of $991.5 million. Over the past twelve months loans held for investment have increased by $127.8 million, or 19.57%. Total deposits have increased by $139.3 million, or 15.51% since last September. Shareholders’ equity, net of unrealized gains on investment securities, was $90.9 million on September 30, 2022, an increase of $8.7 million, or 10.58%, over the September 30, 2021, balance of $82.3 million. All capital ratios exceeded regulatory guidelines for a well-capitalized financial institution under the Basel III regulatory requirements as of September 30, 2022.

Key Financial Ratios:

  • Return on average equity (ROAE) increased from 14.67% to 14.91% and return on average assets (ROAA) decreased from 1.23% to 1.17% year to date.
  • Although the bank’s yield on loans decreased from 5.31% to 4.93% year-to-date, the current upward trend in interest rates has started to bolster overall loan yield.
  • The bank’s cost of funds decreased from 0.29% to 0.19% as deposit rates remain low even in the current rate environment. The cost of funds has also been improved by a $51.7 million increase in non-interest-bearing deposits over the past twelve months.
  • Net interest margin of 3.70% is up from 3.63% one year ago as the bank has put excess liquidity to work in loans and the investment portfolio.

The common stock of Benchmark Bankshares, Inc. trades on the OTC Pink marketplace under the symbol BMBN. Any stockbroker can assist with purchases of the company's stock, as well as with sales of holdings.

Benchmark Community Bank, founded in 1971, is headquartered in Kenbridge, VA. It is the company's sole subsidiary which operates seventeen banking offices throughout central Southside Virginia and northern North Carolina.

Consolidated Statements of Financial Condition & Condensed Consolidated Statement of Earnings

Contact: Helen Person, VP/Director of Marketing & Public Relations
(434) 676-2666 ext. 1103
[email protected]

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