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First National Corp (FXNC) SEC Filing 10-Q Quarterly Report for the period ending Wednesday, June 30, 2021

SEC Filings

First National Corp

CIK: 719402 Ticker: FXNC

Exhibit 99.1

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First National Corporation Reports Second Quarter 2021 Financial Results

 

STRASBURG, Va., July 29, 2021 --- First National Corporation (the “Company” or “First National”) (NASDAQ: FXNC), the bank holding company of First Bank (the “Bank”), reported unaudited consolidated net income of $3.3 million, or $0.69 per diluted share, for the second quarter of 2021, which resulted in return on average assets of 1.31% and return on average equity of 15.33%. This compares to net income of $2.2 million, or $0.46 per diluted share, and return on average assets of 1.00% and return on average equity of 11.30% for the second quarter of 2020.

 

During the second quarter of 2021, the Company incurred merger related expenses totaling $277 thousand related to the acquisition of The Bank of Fincastle (the “Merger”), which was completed on July 1, 2021. Merger related expenses were comprised primarily of legal and professional fees. Also included in earnings in the second quarter of 2021 was a recovery of loan losses totaling $1.0 million, compared to a provision for loan losses of $800 thousand in the same period of 2020. 

 

Key highlights of the second quarter of 2021 are as follows. Comparisons are to the corresponding period in the prior year unless otherwise stated:

 

 

Return on average assets of 1.31%
  Return on average equity of 15.33%
  Efficiency ratio of 63.65%
  Noninterest income increased 37% to $2.4 million
  Nonperforming assets decreased to 0.21% of total assets
 

Recovery of loan losses totaled $1.0 million
 

Merger related expenses totaled $277 thousand

 

“We are especially pleased with the Company’s financial performance for the second quarter while our team worked to complete the Merger with The Bank of Fincastle on July 1,” said Scott Harvard, president and chief executive officer.  Harvard continued. “In addition to a return to superior asset quality metrics, which resulted in a recovery of loan losses, the Bank experienced a 37% increase in noninterest income that was primarily from revenue growth from all banking services. Fee income earned from deposit accounts, wealth management, and other customer services increased, all with double digit growth percentages. The Company also absorbed $277 thousand of merger related expenses during the period. We are delighted with the team of associates who have joined the Bank through the Merger and we are optimistic about prospects for the future.”

 

COVID-19 PANDEMIC UPDATE

 

Operations

 

During the second quarter of 2021, the Bank continued to follow its Pandemic Plan that strives to protect the health of its employees and customers, while continuing to deliver banking services. In response to vaccinations that continued to be provided to thousands of people in our market areas, and the decrease in the number of COVID-19 cases in our communities, the Bank entered phase two of its plan in late March 2021 after operating in phase one since early December 2020. After operating for almost four months primarily through branch drive throughs, ATMs, and mobile and internet banking platforms, lobbies re-opened in March for walk-in customers to conduct their banking business.

 

Paycheck Protection Program

 

The Bank continued to participate as a lender in the U.S. Small Business Administration’s (“SBA”) Paycheck Protection Program (“PPP”) to support local small businesses and non-profit organizations by providing forgivable loans. During the second and third quarters of 2020, the Bank originated $76.6 million of PPP loans, received $2.5 million of loan fees from the SBA, and incurred $535 thousand of loan origination costs. The PPP stopped accepting applications in August of 2020. The loan fees continue to be accreted into earnings evenly over the life of the loans, net of loan origination costs, through interest and fees on loans. PPP loans that were originated in 2020 totaled $26.1 million at June 30, 2021 and are scheduled to mature in the second and third quarters of 2022.

 

 

The following information was filed by First National Corp (FXNC) on Wednesday, August 4, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside First National Corp's 10-Q Quarterly Report:

Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Document And Entity Information
Consolidated Balance Sheets (Current Period Unaudited)
Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals)
Consolidated Statements Of Cash Flows (Unaudited)
Consolidated Statements Of Changes In Shareholders' Equity (Unaudited)
Consolidated Statements Of Changes In Shareholders' Equity (Unaudited) (Parentheticals)
Consolidated Statements Of Comprehensive Income (Unaudited)
Consolidated Statements Of Comprehensive Income (Unaudited) (Parentheticals)
Consolidated Statements Of Income (Unaudited)
Note 1 - General
Note 1 - General (Details Textual)
Note 10 - Benefit Plans
Note 10 - Benefit Plans (Details Textual)
Note 11 - Earnings Per Common Share
Note 11 - Earnings Per Common Share (Details Textual)
Note 11 - Earnings Per Common Share (Tables)
Note 11 - Earnings Per Common Share - Basic And Diluted Earnings Per Share (Details)
Note 12 - Fair Value Measurements
Note 12 - Fair Value Measurements (Details Textual)
Note 12 - Fair Value Measurements (Tables)
Note 12 - Fair Value Measurements - Assets Measured At Fair Value On A Nonrecurring Basis (Details)
Note 12 - Fair Value Measurements - Balances Of Assets Measured At Fair Value On Recurring Basis (Details)
Note 12 - Fair Value Measurements - Carrying Values And Estimated Values Of Financial Instruments (Details)
Note 12 - Fair Value Measurements - Quantitative Information About Level 3 Fair Value Measurements (Details)
Note 13 - Stock Compensation Plans
Note 13 - Stock Compensation Plans (Details Textual)
Note 13 - Stock Compensation Plans (Tables)
Note 13 - Stock Compensation Plans - Summary Of Restricted Stock Unit Activity (Details)
Note 14 - Accumulated Other Comprehensive Income (Loss)
Note 14 - Accumulated Other Comprehensive Income (Loss) (Tables)
Note 14 - Accumulated Other Comprehensive Income (Loss) - Changes In Each Component Of Accumulated Other Comprehensive Income (Loss) (Details)
Note 14 - Accumulated Other Comprehensive Income (Loss) - Changes In Each Component Of Accumulated Other Comprehensive Income (Loss) (Details) (Parentheticals)
Note 14 - Accumulated Other Comprehensive Income (Loss) - Reclassifications From Accumulated Other Comprehensive Loss (Details)
Note 15 - Revenue Recognition
Note 15 - Revenue Recognition (Tables)
Note 15 - Revenue Recognition - Disaggregation Of Revenue (Details)
Note 16 - Derivative Financial Instruments
Note 16 - Derivative Financial Instruments (Details Textual)
Note 16 - Derivative Financial Instruments (Tables)
Note 16 - Derivative Financial Instruments - Derivative Instruments Components (Details)
Note 17 - Acquisition
Note 17 - Acquisition (Details Textual)
Note 2 - Securities
Note 2 - Securities (Details Textual)
Note 2 - Securities (Tables)
Note 2 - Securities - Amortized Cost And Fair Value Of Securities (Details)
Note 2 - Securities - Composition Of Restricted Securities (Details)
Note 2 - Securities - Investments In An Unrealized Loss Position That Were Temporarily Impaired (Details)
Note 2 - Securities - Summary Of Amortized Costs And Fair Values Of Securities (Details)
Note 3 - Loans
Note 3 - Loans (Details Textual)
Note 3 - Loans (Tables)
Note 3 - Loans - Analysis Of The Credit Risk Profile Of Each Loan Class (Details)
Note 3 - Loans - Summary Of Loan Classes And An Aging Of Past Due Loans (Details)
Note 3 - Loans - Summary Of Loans (Details)
Note 4 - Allowance For Loan Losses
Note 4 - Allowance For Loan Losses (Details Textual)
Note 4 - Allowance For Loan Losses (Tables)
Note 4 - Allowance For Loan Losses - Allowance By Impairment Methodology And Loans By Impairment Methodology (Details)
Note 4 - Allowance For Loan Losses - Impaired Loans And Related Allowances (Details)
Note 5 - Other Real Estate Owned (Oreo)
Note 5 - Other Real Estate Owned (Oreo) (Details Textual)
Note 5 - Other Real Estate Owned (Oreo) (Tables)
Note 5 - Other Real Estate Owned (Oreo) - Changes In Balance For Oreo (Details)
Note 6 - Other Borrowings
Note 6 - Other Borrowings (Details Textual)
Note 7 - Capital Requirements
Note 7 - Capital Requirements (Details Textual)
Note 7 - Capital Requirements (Tables)
Note 7 - Capital Requirements - Comparison Of Capital Of Company And Bank With Minimum Regulatory Guidelines (Details)
Note 8 - Subordinated Debt
Note 8 - Subordinated Debt (Details Textual)
Note 9 - Junior Subordinated Debt
Note 9 - Junior Subordinated Debt (Details Textual)
Significant Accounting Policies (Policies)

Material Contracts, Statements, Certifications & more

First National Corp provided additional information to their SEC Filing as exhibits

Ticker: FXNC
CIK: 719402
Form Type: 10-Q Quarterly Report
Accession Number: 0001437749-21-020155
Submitted to the SEC: Mon Aug 16 2021 4:03:39 PM EST
Accepted by the SEC: Mon Aug 16 2021
Period: Wednesday, June 30, 2021
Industry: State Commercial Banks

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