National Bankshares (NKSH) investor relations material

Executive summary

• Net income for the six months ended June 30, 2026 was $10.01 million ($1.57 per diluted share), up from $5.53 million ($0.87 per share) year-over-year.

• Second quarter 2026 net income was $5.03 million ($0.79 per share), compared to $2.29 million ($0.36 per share) in Q2 2025.

• Total assets at June 30, 2026 were $1.83 billion.

• Significant gain of $6.57 million from the sale of an equity investment in Bearing Insurance Group, LLC in Q2 2026.

• Strategic repositioning of the securities portfolio is expected to enhance profitability and net interest margin.

Financial highlights

• Net interest income for the six months ended June 30, 2026 was $25.67 million, up from $21.24 million year-over-year.

• Net interest margin for the six months ended June 30, 2026 was 2.99%, up from 2.48% in the prior year.

• Noninterest income for the six months was $5.33 million, including a $6.57 million gain on sale of equity investment and a $6.55 million loss on sale of securities.

• Noninterest expense for the six months was $18.63 million, down from $19.22 million year-over-year.

• Return on average assets for the six months was 1.10%; return on average equity was 10.76%.

Outlook and guidance

• The securities portfolio repositioning is expected to increase annual interest income by $4.25 million, adding 12 basis points to 2026 and 24 basis points to 2027 net interest margin.

• Focus remains on market share growth, product and technology optimization, and shareholder value.