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The quarter ended with some positive results for Benchmark Bankshares. The Kenbridge-based holding company for Benchmark Community Bank announced unaudited results this week for the three- and six-month periods ending June 30. 

Net income for the second quarter amounted to $3,860,138, a 21.86% increase from the $3,167,623 posted for the second quarter of 2022, while earnings per share increased from $0.70 to $0.85 for the quarter. Net income for the first six months of the year amounted to $8,390,870, a 61.50% increase from the $5,195,532 earned last year, while earnings per share increased from $1.15 to $1.86 for the period.

Also of note, Interest income increased from $18.2 million to $25.3 million when comparing the first six months of 2023 to the same period last year, while interest expense rose from $998,296 to $2.6 million during the same period. The result was a 32.58% increase in net interest income, which increased from $17.2 million to $22.8 million.

Officials reported the bank has experienced mark-to-market gains of $86,413 year-to-date, compared to losses of $595,477 through the first six months of 2022. Meanwhile, non-accrual loans have increased from $636,529 to $880,118. The bank does not hold any foreclosed property as of June 30.

The bank reported that a total of $257,766 was provisioned to the loan loss reserve during the first six months of 2023, compared to a provision of $220,826 during the same period last year. The allowance for loan losses as a percentage of net loans was 0.83% on June 30, compared to 0.84% last June.

Other news from the report

Interest expense on borrowings, used to support the company’s stock repurchase program, amounted to $46,957 year-to-date. Interest expense of $67,296 was recognized last year during the same period.

A total of 4,539 common shares have been repurchased year-to-date at an average price of $24.00 per share. A total of 6,550 shares were repurchased at an average price of $24.00 during the first six months of 2022. The Company had 4,521,257 shares outstanding as of June 30.

Also as of June 30, total assets were $1.12 billion, an increase of $61.8 million over the June 30, 2022, balance of $1.06 billion. Over the past twelve months, total loans have increased by $120.9 million, while total deposits have increased by $49.7 million. Shareholders’ equity, net of unrealized gains on investment securities, was $99.6 million on June 30, 2023, an increase of $12.7 million, or 14.6%, over the June 30, 2022, balance of $86.8 million. All capital ratios exceeded regulatory guidelines for a well-capitalized financial institution under the Basel III regulatory requirements as of June 30.

Some key financial ratios 

Return on average equity (ROAE) increased from 12.52% to 18.21% and return on average assets (ROAA) increased from 0.99% to 1.52% year to date.

Yield on loans increased from 4.90% to 5.31%, while the bank’s cost of funds increased from 0.19% to 0.51%.

Net interest margin has increased from 3.47% to 4.39% as a result of rising interest rates and growth in both loans and investments.

Current book value of the company is $20.52 per share, compared to $17.68 one year ago. The closing market price at quarter-end was $22.95 per share, or 111.9% of book value.