National Bankshares, Inc. has filed an 8-K report with the Securities and Exchange Commission on November 3, 2026, providing an update on its financial performance and strategy for the second quarter of 2026. The filing includes an investor presentation (Exhibit 99.1) that details the company's results for the three and six months ended June 30, 2026.
According to the presentation, the company reported total assets of $1.83 billion and total deposits of $1.63 billion as of June 30, 2026. The company operates 28 full-service branches across Southwestern, Western, and Central Virginia, with its headquarters located in Blacksburg.
The financial results for the second quarter of 2026 show a significant increase in profitability compared to the prior year. Net income for the quarter was $5.03 million, representing an 81.2% year-over-year increase from $2.29 million in Q2 2025. Diluted earnings per share (EPS) were $0.79, up from $0.36 in the same period last year. The company attributes these gains to lower deposit costs, improved yields on loans and securities, and lower operating expenses.
Net interest income for the quarter was $13.05 million, a 19% increase from $10.99 million in Q2 2025. The net interest margin expanded to 3.00%, an improvement of 51 basis points compared to the 2.56% margin reported in the prior year. The company’s efficiency ratio, a measure of operating expenses relative to revenue, improved to 58.40% from 63.83% in the prior year.
For the year-to-date period ending June 30, 2026, net income reached $10.01 million, a 81.2% increase from $5.53 million in the same period in 2025. Diluted EPS was $1.57, compared to $0.87 in the prior year. The company noted that its quarterly net income has grown steadily from $2.68 million in Q3 2024 to $5.03 million in Q2 2026.
In terms of credit quality, the company reported nonaccrual and loans 90+ days past due as a percentage of total loans at 0.06%. The allowance for credit losses (ACL) as a percentage of total loans stood at 0.99%. The company also highlighted its dominant market share in its core markets, ranking first in deposit share in Giles, Pulaski, and Tazewell counties.
The presentation outlines a securities repositioning strategy, noting that $127.33 million of mortgage-backed securities were purchased with a weighted average yield of 5.26%, compared to a 1.80% yield on securities sold. The company projects this repositioning will generate $4.25 million in additional annual interest income and improve the net interest margin by 12 basis points for 2026 and 24 basis points for 2027.
Regulatory capital ratios as of June 30, 2026, were reported at 16.52% for Common Equity Tier 1 and 17.38% for Total Capital. The company also noted its stock trades on the Nasdaq under the symbol NKSH.
