Benchmark Bankshares, Inc. Reports Increased Earnings for Three and Nine Months Ended September 30, 2023

October 31, 2023 - KENBRIDGE, VA – Benchmark Bankshares, Inc. (BMBN), the Kenbridge-based holding company for Benchmark Community Bank, announced unaudited earnings of $3.5 million for the third quarter of 2023, down from $4.1 million earned during the third quarter of 2022. Earnings per share for the quarter decreased from $0.91 to $0.77. Net income through the first nine months of the year amounted to $11.9 million, a 27.81% increase from the $9.3 million earned through the first nine months of 2022, while earnings per share increased from $2.06 to $2.63.

Notable Items:

  • Net interest income grew from $27.6 million to $33.8 million, an increase of 22.41%, when comparing the first nine months of 2023 to the same period last year.
  • Noninterest income increased from $6.2 million to $6.8 million even with a decline in mortgage income and a prior year one-time gain. The bank’s residential mortgage demand continues to decline due to market conditions, reducing fee income on mortgage loans sold to $208 thousand from $912 thousand through the first nine months of 2023 and 2022, respectively. During September of 2022, the bank recognized a one-time gain of $680 thousand from the purchase of a branch office from First Community Bank in Emporia, VA.
  • Despite rising rates, demand for commercial real estate loans has remained strong during 2023. Total loans held for investment increased $49.5 million year-to-date and $84.7 million over the past twelve months.
  • The bank does not currently hold any foreclosed property and has not incurred any expenses related to foreclosed property year-to-date. In addition, non-accrual loans were $730 thousand as of September 30, 2023, compared to $654 thousand one year ago.
  • Net charge-offs for the first nine months of 2023 amounted to $90 thousand compared to $62 thousand for the first nine months of 2022.
  • A total of $90 thousand was provisioned to the reserve for credit losses during the first nine months of 2023, compared to a provision of $559 thousand during the same period last year. The allowance for credit losses as a percentage of net loans was 0.80% on September 30, 2023, compared to 0.82% last September.
  • Interest expense on borrowings, used to support the company’s stock repurchase program, amounted to $66 thousand year-to-date compared to a cost of $98 thousand last year.
  • A total of 27,435 shares, at a price of $23.50 per share, have been repurchased year-to-date. A total of 6,550 shares were repurchased at an average price of $19.10 during the first nine months of 2022. Total shares outstanding as of September 30, 2023, were 4,498,361.

As of September 30, 2023, total assets were $1.10 billion, a decrease of $25.9 million, or 2.29%, from $1.13 billion on September 30, 2022. Over the past twelve months, loans held for investment increased by $84.6 million, or 10.84%. Total deposits decreased by $36.4 million, or 3.51% from September 30, 2022. The bank has placed $31.4 million of customer deposits with IntraFi as one-way sell deposits, contributing to the decrease in overall deposit balances shown on the balance sheet.

Shareholders’ equity, net of unrealized gains on investment securities, was $102.6 million on September 30, 2023, an increase of $9.2 million, or 9.85%, from the September 30, 2022, balance of $90.9 million. All capital ratios exceeded regulatory guidelines for a well-capitalized financial institution under the Basel III regulatory requirements as of September 30, 2023.

Key Financial Ratios:

  • Return on average equity (ROAE) increased from 14.91% to 17.22% and return on average assets (ROAA) increased from 1.17% to 1.43% for the nine months ended September 30, 2022 and 2023, respectively.
  • The bank’s yield on loans increased from 4.93% to 5.37% year-to-date, as increasing interest rates have bolstered overall loan yield.
  • The bank’s cost of funds increased from 0.19% to 0.66% however deposit costs remain low even in the current rate environment.
  • Net interest margin of 4.34% is up from 3.70% 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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