Company Quick10K Filing
Quick10K
American National Bankshares
Closing Price ($) Shares Out (MM) Market Cap ($MM)
$37.18 11 $415
10-Q 2019-06-30 Quarter: 2019-06-30
10-Q 2019-03-31 Quarter: 2019-03-31
10-K 2018-12-31 Annual: 2018-12-31
10-Q 2018-09-30 Quarter: 2018-09-30
10-Q 2018-06-30 Quarter: 2018-06-30
10-Q 2018-03-31 Quarter: 2018-03-31
10-K 2017-12-31 Annual: 2017-12-31
10-Q 2017-09-30 Quarter: 2017-09-30
10-Q 2017-06-30 Quarter: 2017-06-30
10-Q 2017-03-31 Quarter: 2017-03-31
10-K 2016-12-31 Annual: 2016-12-31
10-Q 2016-09-30 Quarter: 2016-09-30
10-Q 2016-06-30 Quarter: 2016-06-30
10-Q 2016-03-31 Quarter: 2016-03-31
10-K 2015-12-31 Annual: 2015-12-31
10-Q 2015-09-30 Quarter: 2015-09-30
10-Q 2015-06-30 Quarter: 2015-06-30
10-Q 2015-03-31 Quarter: 2015-03-31
10-K 2014-12-31 Annual: 2014-12-31
10-Q 2014-09-30 Quarter: 2014-09-30
10-Q 2014-06-30 Quarter: 2014-06-30
10-Q 2014-03-31 Quarter: 2014-03-31
10-K 2013-12-31 Annual: 2013-12-31
8-K 2019-08-05 Officers, Exhibits
8-K 2019-07-29 Regulation FD, Exhibits
8-K 2019-07-18 Earnings, Exhibits
8-K 2019-07-08 Regulation FD, Exhibits
8-K 2019-06-05 Officers, Exhibits
8-K 2019-05-24 Shareholder Vote, Other Events
8-K 2019-05-21 Other Events, Exhibits
8-K 2019-04-18 Earnings, Exhibits
8-K 2019-04-01 M&A, Off-BS Arrangement, Officers, Amend Bylaw, Exhibits
8-K 2019-03-25 Regulation FD, Exhibits
8-K 2019-03-21 Shareholder Vote, Other Events, Exhibits
8-K 2019-02-19 Other Events, Exhibits
8-K 2019-01-17 Earnings, Exhibits
8-K 2018-11-21 Other Events, Exhibits
8-K 2018-10-18 Earnings, Exhibits
8-K 2018-10-01 Enter Agreement, Exhibits
8-K 2018-10-01 Other Events, Exhibits
8-K 2018-07-30 Regulation FD, Exhibits
8-K 2018-07-19 Earnings, Exhibits
8-K 2018-07-19 Other Events, Exhibits
8-K 2018-05-17 Other Events, Exhibits
8-K 2018-04-19 Earnings, Exhibits
8-K 2018-02-21 Other Events, Exhibits
8-K 2018-01-19 Other Events, Exhibits
8-K 2018-01-18 Earnings, Exhibits
BUD Anheuser-Busch Inbev 164,230
NOC Northrop Grumman 50,090
CXO Concho Resources 22,250
SYX Systemax 843
IDT IDT 192
IMMP Immtech Pharmaceuticals 66
HEBT Hebron Technology 14
NROM Noble Romans 0
PLTM Graniteshares Platinum Trust 0
SLDV Security Land & Development 0
AMNB 2019-06-30
Item 5. Other Information 65 Item 6. Exhibits 66 Signatures 67
Part I. Financial Information
Item 1. Financial Statements
Note 1 - Accounting Policies
Note 2 - Acquisitions
Note 3 - Securities
Note 4 - Loans
Note 5 - Allowance for Loan Losses and Reserve for Unfunded Lending Commitments
Note 6 - Goodwill and Other Intangible Assets
Note 7 - Leases
Note 8 - Short-Term Borrowings
Note 9 - Long-Term Borrowings
Note 10 - Subordinated Debt
Note 11 - Junior Subordinated Debt
Note 12 - Derivative Financial Instruments and Hedging Activities
Note 13 - Stock Based Compensation
Note 14 - Earnings per Common Share
Note 15 - Employee Benefit Plans
Note 16 - Fair Value Measurements
Note 17 - Segment and Related Information
Note 18 - Supplemental Cash Flow Information
Note 19 - Accumulated Other Comprehensive Income (Loss)
Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II. Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-31.1 amnb-06302019xexhibit311.htm
EX-31.2 amnb-06302019xexhibit312.htm
EX-32.1 amnb-06302019xexhibit321.htm
EX-32.2 amnb-06302019xexhibit322.htm

American National Bankshares Earnings 2019-06-30

AMNB 10Q Quarterly Report

Balance SheetIncome StatementCash Flow

10-Q 1 amnb-06302019x10q.htm 10-Q Document
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.  20549
FORM 10-Q
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED June 30, 2019.
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM             TO           .
Commission file number:  0-12820
AMERICAN NATIONAL BANKSHARES INC.
(Exact name of registrant as specified in its charter)
VIRGINIA
 
54-1284688
(State or other jurisdiction of incorporation or organization)
 
(I.R.S. Employer Identification No.)
 
 
 
628 Main Street, Danville, Virginia
 
24541
(Address of principal executive offices)
 
(Zip Code)
(434) 792-5111
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock
AMNB
Nasdaq Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
 
Yes
x
No
o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
 
Yes
x
No
o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.  See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer  o
Accelerated filer  o
Non-accelerated filer  o 
Smaller reporting company x
 
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
 
Yes
o
No
x
At July 29, 2019, the Company had 11,143,132 shares of Common Stock outstanding, $1 par value.



AMERICAN NATIONAL BANKSHARES INC.
Index
 
 
Page
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

2



3



PART I.  FINANCIAL INFORMATION
ITEM 1.  FINANCIAL STATEMENTS
American National Bankshares Inc.
Consolidated Balance Sheets
(Dollars in thousands, except per share data)
Assets
(Unaudited)
June 30, 2019
 
(*) December 31, 2018
Cash and due from banks
$
34,460

 
$
29,587

Interest-bearing deposits in other banks
20,454

 
34,668

 
 
 
 
Equity securities, at fair value
125

 
1,830

Securities available for sale, at fair value
334,326

 
332,653

Restricted stock, at cost
7,796

 
5,247

Loans held for sale
3,165

 
640

 
 
 
 
Loans, net of unearned income
1,836,241

 
1,357,476

Less allowance for loan losses
(12,786
)
 
(12,805
)
Net loans
1,823,455

 
1,344,671

 
 
 
 
Premises and equipment, net
39,038

 
26,675

Other real estate owned, net of valuation allowance of $144 in 2019 and $109 in 2018
1,433

 
869

Goodwill
84,633

 
43,872

Core deposit intangibles, net
8,613

 
926

Bank owned life insurance
27,451

 
18,941

Accrued interest receivable and other assets
33,133

 
22,287

Total assets
$
2,418,082

 
$
1,862,866

 
 
 
 
Liabilities
 

 
 

Demand deposits -- noninterest bearing
$
554,400

 
$
435,828

Demand deposits -- interest bearing
326,105

 
234,621

Money market deposits
451,343

 
401,461

Savings deposits
178,723

 
132,360

Time deposits
488,526

 
361,957

Total deposits
1,999,097

 
1,566,227

 
 
 
 
Short-term borrowings:
 
 
 
Customer repurchase agreements
37,222

 
35,243

Other short-term borrowings
13,528

 

Subordinated debt
7,526

 

Junior subordinated debt
27,978

 
27,927

Accrued interest payable and other liabilities
20,814

 
10,927

Total liabilities
2,106,165

 
1,640,324

 
 
 
 
Shareholders' equity
 

 
 

Preferred stock, $5 par, 2,000,000 shares authorized, none outstanding

 

Common stock, $1 par, 20,000,000 shares authorized, 11,141,355 shares outstanding at June 30, 2019 and 8,720,337 shares outstanding at December 31, 2018
11,089

 
8,668

Capital in excess of par value
160,572

 
78,172

Retained earnings
141,339

 
141,537

Accumulated other comprehensive loss, net
(1,083
)
 
(5,835
)
Total shareholders' equity
311,917

 
222,542

Total liabilities and shareholders' equity
$
2,418,082

 
$
1,862,866

(*) -  Derived from audited consolidated financial statements.
The accompanying notes are an integral part of the consolidated financial statements.

4



American National Bankshares Inc.
Consolidated Statements of Income (Loss)
(Dollars in thousands, except per share data) (Unaudited)
 
Three Months Ended 
 June 30,
 
Six Months Ended 
 June 30,
 
2019
 
2018
 
2019
 
2018
Interest and Dividend Income:
 
 
 
 
 
 
 
Interest and fees on loans
$
22,629

 
$
14,766

 
$
38,267

 
$
29,423

Interest and dividends on securities:
 

 
 

 
 
 
 
Taxable
1,980

 
1,540

 
3,801

 
2,864

Tax-exempt
239

 
423

 
526

 
842

Dividends
105

 
78

 
189

 
158

Other interest income
258

 
185

 
524

 
373

Total interest and dividend income
25,211

 
16,992

 
43,307

 
33,660

Interest Expense:
 

 
 

 
 

 
 

Interest on deposits
3,520

 
1,873

 
5,992

 
3,698

Interest on short-term borrowings
178

 
2

 
350

 
12

Interest on long-term borrowings
14

 

 
14

 

Interest on subordinated debt
122

 

 
122

 

Interest on junior subordinated debt
388

 
329

 
772

 
619

Total interest expense
4,222

 
2,204

 
7,250

 
4,329

Net Interest Income
20,989

 
14,788

 
36,057

 
29,331

Provision for (recovery of) loan losses
(10
)
 
(30
)
 
6

 
(74
)
Net Interest Income After Provision for (Recovery of) Loan Losses
20,999

 
14,818

 
36,051

 
29,405

Noninterest Income:
 

 
 

 
 

 
 

Trust fees
933

 
945

 
1,847

 
1,874

Service charges on deposit accounts
724

 
592

 
1,318

 
1,204

Other fees and commissions
1,015

 
679

 
1,723

 
1,321

Mortgage banking income
586

 
491

 
992

 
941

Securities gains, net
147

 
289

 
470

 
410

Brokerage fees
186

 
209

 
333

 
431

Income (loss) from Small Business Investment Companies
(137
)
 
171

 
31

 
326

Gains (losses) on premises and equipment, net
(87
)
 

 
(87
)
 
3

Other
315

 
187

 
506

 
386

Total noninterest income
3,682

 
3,563

 
7,133

 
6,896

Noninterest Expense:
 

 
 

 
 

 
 

Salaries
7,048

 
5,095

 
11,712

 
10,092

Employee benefits
1,425

 
1,111

 
2,655

 
2,286

Occupancy and equipment
1,431

 
1,100

 
2,515

 
2,228

FDIC assessment
169

 
132

 
294

 
278

Bank franchise tax
412

 
291

 
702

 
572

Core deposit intangible amortization
458

 
77

 
513

 
154

Data processing
717

 
467

 
1,249

 
889

Software
321

 
354

 
645

 
659

Other real estate owned, net
(44
)
 
25

 
(31
)
 
55

Merger related expense
10,871

 

 
11,322

 

Other
3,508

 
2,350

 
5,669

 
4,491

Total noninterest expense
26,316

 
11,002

 
37,245

 
21,704

Income (Loss) Before Income Taxes
(1,635
)
 
7,379

 
5,939

 
14,597

 
 
 
 
 
 
 
 

5



Income Taxes
(405
)
 
1,399

 
1,166

 
2,805

Net Income (Loss)
$
(1,230
)
 
$
5,980

 
$
4,773

 
$
11,792

 
 
 
 
 
 
 
 
Net Income (Loss) Per Common Share:
 

 
 

 
 

 
 

Basic
$
(0.11
)
 
$
0.69

 
$
0.48

 
$
1.36

Diluted
$
(0.11
)
 
$
0.69

 
$
0.48

 
$
1.36

Weighted Average Common Shares Outstanding:
 

 
 

 
 

 
 

Basic
11,126,800

 
8,692,107

 
9,942,566

 
8,680,739

Diluted
11,126,800

 
8,704,726

 
9,952,115

 
8,695,860

The accompanying notes are an integral part of the consolidated financial statements.

6



American National Bankshares Inc.
Consolidated Statements of Comprehensive Income
(Dollars in thousands) (Unaudited)
 
Three Months Ended 
 June 30,
 
2019
 
2018
Net income (loss)
$
(1,230
)
 
$
5,980

 
 
 
 
Other comprehensive income (loss):
 

 
 

 
 
 
 
Unrealized gains (losses) on securities available for sale
4,106

 
(1,446
)
Tax effect
(920
)
 
325

 
 
 
 
Reclassification adjustment for gains on sales or calls of securities available for sale
(136
)
 

Tax effect
31

 

 
 
 
 
Unrealized losses on cash flow hedges
(1,086
)
 
(237
)
Tax effect
243

 
53

 
 
 
 
Other comprehensive income (loss)
2,238

 
(1,305
)
 
 
 
 
Comprehensive income
$
1,008

 
$
4,675

The accompanying notes are an integral part of the consolidated financial statements.
American National Bankshares Inc.
Consolidated Statements of Comprehensive Income
(Dollars in thousands) (Unaudited)
 
Six Months Ended 
 June 30,
 
2019
 
2018
Net income
$
4,773

 
$
11,792

 
 
 
 
Other comprehensive income (loss):
 

 
 

 
 
 
 
Unrealized gains (losses) on securities available for sale
8,075

 
(5,180
)
Tax effect
(1,809
)
 
1,186

 
 
 
 
Reclassification adjustment for gains on sales or calls of securities available for sale
(140
)
 
(8
)
Tax effect
32

 
2

 
 
 
 
Unrealized losses on cash flow hedges
(1,811
)
 
(237
)
Tax effect
405

 
53

 
 
 
 
Other comprehensive income (loss)
4,752

 
(4,184
)
 
 
 
 
Comprehensive income
$
9,525

 
$
7,608

The accompanying notes are an integral part of the consolidated financial statements.

7



American National Bankshares Inc.
Consolidated Statements of Changes in Shareholders' Equity
Three Months Ended June 30, 2019 and 2018
(Dollars in thousands, except per share data) (Unaudited)
 
Common
Stock
 
Capital in
Excess of
Par Value
 
Retained
Earnings
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Total
Shareholders'
Equity
Balance, April 1, 2018
$
8,621

 
$
76,525

 
$
131,299

 
$
(6,605
)
 
$
209,840

 
 
 
 
 
 
 
 
 
 
Net income

 

 
5,980

 

 
5,980

 
 
 
 
 
 
 
 
 
 
Other comprehensive loss

 

 

 
(1,305
)
 
(1,305
)
 
 
 
 
 
 
 
 
 
 
Reclassification for ASU 2016-01 adoption

 

 

 

 

 
 
 
 
 
 
 
 
 
 
Stock options exercised (28,710 shares)
29

 
661

 

 

 
690

 
 
 
 
 
 
 
 
 
 
Vesting of restricted stock

 

 

 

 

 
 
 
 
 
 
 
 
 
 
Equity based compensation (4,384 shares)
4

 
310

 

 

 
314

 
 
 
 
 
 
 
 
 
 
Cash dividends paid, $0.50 per share

 

 
(2,171
)
 

 
(2,171
)
 
 
 
 
 
 
 
 
 
 
Balance, June 30, 2018
$
8,654

 
$
77,496

 
$
135,108

 
$
(7,910
)
 
$
213,348

 
 
 
 
 
 
 
 
 
 
Balance, April 1, 2019
$
8,705

 
$
78,738

 
$
145,351

 
$
(3,321
)
 
$
229,473

 
 
 
 
 
 
 
 
 
 
Net loss

 

 
(1,230
)
 

 
(1,230
)
 
 
 
 
 
 
 
 
 
 
Other comprehensive income

 

 

 
2,238

 
2,238

 
 
 
 
 
 
 
 
 
 
Issuance of common stock (2,361,686 shares)
2,362

 
80,108

 

 

 
82,470

 
 
 
 
 
 
 
 
 
 
Issuance of replacement options/restricted stock

 
870

 

 

 
870

 
 
 
 
 
 
 
 
 
 
Stock options exercised (17,330 shares)
17

 
271

 

 

 
288

 
 
 
 
 
 
 
 
 
 
Vesting of restricted stock

 

 

 

 

 
 
 
 
 
 
 
 
 
 
Equity based compensation (5,770 shares)
5

 
585

 

 

 
590

 
 
 
 
 
 
 
 
 
 
Cash dividends paid, $0.50 per share

 

 
(2,782
)
 

 
(2,782
)
 
 
 
 
 
 
 
 
 
 
Balance, June 30, 2019
$
11,089

 
$
160,572

 
$
141,339

 
$
(1,083
)
 
$
311,917

The accompanying notes are an integral part of the consolidated financial statements.

8



American National Bankshares Inc.
Consolidated Statements of Changes in Shareholders' Equity
Six Months Ended June 30, 2019 and 2018
(Dollars in thousands, except per share data) (Unaudited)
 
Common
Stock
 
Capital in
Excess of
Par Value
 
Retained
Earnings
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Total
Shareholders'
Equity
Balance, December 31, 2017
$
8,604

 
$
76,179

 
$
127,010

 
$
(3,076
)
 
$
208,717

 
 
 
 
 
 
 
 
 
 
Net income

 

 
11,792

 

 
11,792

 
 
 
 
 
 
 
 
 
 
Other comprehensive loss

 

 

 
(4,184
)
 
(4,184
)
 
 
 
 
 
 
 
 
 
 
Reclassification for ASU 2016-01 adoption

 

 
650

 
(650
)
 

 
 
 
 
 
 
 
 
 
 
Stock options exercised (32,010 shares)
32

 
743

 

 

 
775

 
 
 
 
 
 
 
 
 
 
Vesting of restricted stock (10,101 shares)
10

 
(10
)
 

 

 

 
 
 
 
 
 
 
 
 
 
Equity based compensation (25,570 shares)
8

 
584

 

 

 
592

 
 
 
 
 
 
 
 
 
 
Cash dividends paid, $0.50 per share

 

 
(4,344
)
 

 
(4,344
)
 
 
 
 
 
 
 
 
 
 
Balance, June 30, 2018
$
8,654

 
$
77,496

 
$
135,108

 
$
(7,910
)
 
$
213,348

 
 
 
 
 
 
 
 
 
 
Balance, December 31, 2018
$
8,668

 
$
78,172

 
$
141,537

 
$
(5,835
)
 
$
222,542

 
 
 
 
 
 
 
 
 
 
Net income

 

 
4,773

 

 
4,773

 
 
 
 
 
 
 
 
 
 
Other comprehensive income

 

 

 
4,752

 
4,752

 
 
 
 
 
 
 
 
 
 
Issuance of common stock (2,361,686 shares)
2,362

 
80,108

 

 

 
82,470

 
 
 
 
 
 
 
 
 
 
Issuance of replacement options/restricted stock

 
870

 

 

 
870

 
 
 
 
 
 
 
 
 
 
Stock options exercised (30,530 shares)
30

 
548

 

 

 
578

 
 
 
 
 
 
 
 
 
 
Vesting of restricted stock (20,285 shares)
20

 
(20
)
 

 

 

 
 
 
 
 
 
 
 
 
 
Equity based compensation (28,802 shares)
9

 
894

 

 

 
903

 
 
 
 
 
 
 
 
 
 
Cash dividends paid, $0.50 per share

 

 
(4,971
)
 

 
(4,971
)
 
 
 
 
 
 
 
 
 
 
Balance, June 30, 2019
$
11,089

 
$
160,572

 
$
141,339

 
$
(1,083
)
 
$
311,917

The accompanying notes are an integral part of the consolidated financial statements.

9


American National Bankshares Inc.
Consolidated Statements of Cash Flows
(Dollars in thousands) (Unaudited)
 
Six Months Ended 
 June 30,
 
2019
 
2018
Cash Flows from Operating Activities:
 
 
 
Net income
$
4,773

 
$
11,792

Adjustments to reconcile net income to net cash provided by operating activities:
 

 
 

Provision for (recovery of) loan losses
6

 
(74
)
Depreciation
958

 
933

Net accretion of acquisition accounting adjustments
(1,373
)
 
(804
)
Core deposit intangible amortization
513

 
154

Net amortization of securities
613

 
859

Net gain on sale or call of securities available for sale
(140
)
 
(8
)
Net change in fair value of equity securities
(330
)
 
(402
)
Gain on sale of loans held for sale
(992
)
 
(941
)
Proceeds from sales of loans held for sale
41,962

 
39,145

Originations of loans held for sale
(43,495
)
 
(38,861
)
Net gain on other real estate owned
(134
)
 
(25
)
Valuation allowance on other real estate owned
56

 
22

Net loss (gain) on sale of premises and equipment
87

 
(3
)
Equity based compensation expense
903

 
592

Earnings on bank owned life insurance
(264
)
 
(214
)
Deferred income tax expense (benefit)
222

 
(27
)
Net change in interest receivable
229

 
(62
)
Net change in other assets
8,880

 
(875
)
Net change in interest payable
93

 
(2
)
Net change in other liabilities
(2,211
)
 
(34
)
Net cash provided by operating activities
10,356

 
11,165

 
 
 
 
Cash Flows from Investing Activities:
 

 
 

Proceeds from sales of equity securities
317

 
431

Proceeds from sales of securities available for sale
29,878

 
22,066

Proceeds from maturities, calls and paydowns of securities available for sale
38,817

 
16,000

Purchases of securities available for sale
(26,312
)
 
(66,221
)
Net change in restricted stock
39

 
647

Net increase in loans
(33,371
)
 
(2,952
)
Proceeds from sale of premises and equipment

 
24

Purchases of premises and equipment
(1,299
)
 
(932
)
Proceeds from sales of other real estate owned
1,137

 
636

Cash paid in bank acquisition
(27
)
 

Cash acquired in bank acquisition
26,283

 

Net cash provided by (used in) investing activities
35,462

 
(30,301
)
 
 
 
 
Cash Flows from Financing Activities:
 

 
 

Net change in demand, money market, and savings deposits
(36,239
)
 
37,585

Net change in time deposits
(14,373
)
 
(11,565
)
Net change in customer repurchase agreements
1,979

 
(3,950
)
Net change in other short-term borrowings
(1,355
)
 
(18,500
)
Net change in long-term borrowings
(778
)
 

Common stock dividends paid
(4,971
)
 
(4,344
)
Proceeds from exercise of stock options
578

 
775

Net cash (used in) provided by financing activities
(55,159
)
 
1

 
 
 
 
Net Decrease in Cash and Cash Equivalents
(9,341
)
 
(19,135
)
Cash and Cash Equivalents at Beginning of Period
64,255

 
52,477

Cash and Cash Equivalents at End of Period
$
54,914

 
$
33,342

The accompanying notes are an integral part of the consolidated financial statements.

10



AMERICAN NATIONAL BANKSHARES INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1 – Accounting Policies
The consolidated financial statements include the accounts of American National Bankshares Inc. (the "Company") and its wholly owned subsidiary, American National Bank and Trust Company (the "Bank"). The Bank offers a wide variety of retail, commercial, secondary market mortgage lending, and trust and investment services which also include non-deposit products such as mutual funds and insurance policies.
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, goodwill and intangible assets, other-than-temporary impairment of securities, accounting for merger and acquisition activity, derivative financial instruments, accounting for acquired loans with specific credit-related deterioration, the valuation of deferred tax assets and liabilities, and the valuation of other real estate owned ("OREO").
All significant inter-company transactions and accounts are eliminated in consolidation, with the exception of the AMNB Trust and the MidCarolina Trusts, as detailed in Note 11.
In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal recurring accruals) necessary to present fairly the results of the interim periods. The results of operations for the interim periods are not necessarily indicative of the results that may occur for any other period. Certain reclassifications have been made to prior period balances to conform to the current period presentation. These reclassifications did not have an impact on net income and were considered immaterial. These statements should be read in conjunction with the Notes to Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2018.
Adoption of New Accounting Standards
On January 1, 2019, the Company adopted Accounting Standards Update ("ASU") 2016-02, "Leases (Topic 842)." Among other things, in the amendments in ASU 2016-02, lessees are required to recognize the following for all leases (with the exception of short-term leases) at the commencement date: (i) a lease liability, which is a lessee's obligation to make lease payments arising from a lease, measured on a discounted basis; and (ii) a right-of-use asset, which is an asset that represents the lessee's right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged. Certain targeted improvements were made to align, where necessary, lessor accounting with the lessee accounting model and Topic 606, Revenue from Contracts with Customers. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach. The Financial Accounting Standards Board ("FASB") made subsequent amendments to Topic 842 in July 2018 through ASU 2018-10 ("Codification Improvements to Topic 842, Leases.") and ASU 2018-11 ("Leases (Topic 842): Targeted Improvements."). Among these amendments is the provision in ASU 2018-11 that provides entities with an additional (and optional) transition method to adopt the new leases standard. Under this new transition method, an entity initially applies the new leases standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Consequently, an entity's reporting for the comparative periods presented in the financial statements in which it adopts the new leases standard continue to be in accordance with current GAAP (Topic 840, Leases). The Company adopted using the additional (and optional) transition method. The effect of adopting this standard on January 1, 2019 was an approximately $4.4 million increase in assets and liabilities on the Company's consolidated balance sheet.
Recent Accounting Pronouncements
In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." The amendments in this ASU, among other things, require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting

11



for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The amendments in this ASU are effective for Securities and Exchange Commission ("SEC") filers for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Based on FASB’s July 17, 2019 meeting, an exposure draft is expected that, once finalized, could change implementation dates for many companiesThe Company has implemented and completed a significant amount of a project plan addressing the components of this ASU with the assistance of an outside vendor. The Company is currently assessing the impact that ASU 2016-13 will have on its consolidated financial statements.
In January 2017, the FASB issued ASU 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment." The amendments in this ASU simplify how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit's goodwill with the carrying amount of that goodwill. Instead, under the amendments in this ASU, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. Public business entities that are SEC filers should adopt the amendments in this ASU for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company does not expect the adoption of ASU 2017-04 to have a material impact on its consolidated financial statements.
In August 2018, the FASB issued ASU 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement." The amendments in this ASU modify the disclosure requirements in Topic 820 to add disclosures regarding changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements and the narrative description of measurement uncertainty. Certain disclosure requirements in Topic 820 are also removed or modified. The amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Certain of the amendments are to be applied prospectively while others are to be applied retrospectively. Early adoption is permitted. The Company does not expect the adoption of ASU 2018-13 to have a material impact on its consolidated financial statements.
In August 2018, the FASB issued ASU 2018-14, "Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20): Disclosure Framework-Changes to the Disclosure Requirements for Defined Benefit Plans." The amendments in this ASU modify the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. Certain disclosure requirements have been deleted while the following disclosure requirements have been added: the weighted-average interest crediting rates for cash balance plans and other plans with promised interest crediting rates and an explanation of the reasons for significant gains and losses related to changes in the benefit obligation for the period. The amendments also clarify the disclosure requirements in paragraph 715-20-50-3, which state that the following information for defined benefit pension plans should be disclosed: the projected benefit obligation ("PBO") and fair value of plan assets for plans with PBOs in excess of plan assets and the accumulated benefit obligation ("ABO") and fair value of plan assets for plans with ABOs in excess of plan assets. The amendments are effective for fiscal years ending after December 15, 2020. Early adoption is permitted. The Company is currently assessing the impact that ASU 2018-14 will have on its consolidated financial statements.
In April 2019, the FASB issued ASU 2019-04, "Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments." The amendments in this ASU clarify and improve areas of guidance related to the recently issued standards on credit losses, hedging, and recognition and measurement including improvements resulting from various Transition Resource Group Meetings. The amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently assessing the impact that ASU 2019-04 will have on its consolidated financial statements.
In May 2019, the FASB issued ASU 2019-05, "Financial Instruments-Credit Losses (Topic 326): Targeted Transition Relief." The amendments in this ASU provide entities that have certain instruments within the scope of Subtopic 326-20 with an option to irrevocably elect the fair value option in Subtopic 825-10, applied on an instrument-by-instrument basis for eligible instruments, upon the adoption of Topic 326. The fair value option election does not apply to held-to-maturity debt securities. An entity that elects the fair value option should subsequently measure those instruments at fair value with changes in fair value flowing through earnings. The amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The amendments should be applied on a modified-retrospective basis by means of a cumulative-effect adjustment to the opening balance of retained earnings balance in the balance sheet. Early adoption is permitted. The Company is currently assessing the impact that ASU 2019-05 will have on its consolidated financial statements.

12



Note 2 - Acquisitions
On April 1, 2019, the Company completed its acquisition of Roanoke-based HomeTown Bankshares Corporation ("HomeTown") and its wholly-owned subsidiary bank, HomeTown Bank. Pursuant and subject to the terms of the merger agreement, as a result of the merger, the holders of shares of HomeTown common stock received 0.4150 shares of the Company's common stock for each share of HomeTown common stock held immediately prior to the effective date of the merger.
The transaction was accounted for using the acquisition method of accounting and, accordingly, assets acquired, liabilities assumed, and consideration exchanged were recorded at estimated fair values on the acquisition date. Fair values are preliminary and subject to refinement for up to one year after the closing date of the acquisition, in accordance with Accounting Standards Codification ("ASC") 350, Intangibles-Goodwill and Other. The following table provides a preliminary assessment of the consideration transferred, assets acquired, and liabilities assumed as of the date of the acquisition (dollars in thousands):
Consideration Paid:
 
Common shares issued (2,361,686)
$
82,470

Issuance of replacement stock options/restricted stock
753

Cash paid in lieu of fractional shares
27

Value of consideration
83,250

 
 

Assets acquired:
 

Cash and cash equivalents
26,283

Investment securities
34,876

Restricted stock
2,588

Loans
444,324

Premises and equipment
12,554

Deferred income taxes
2,329

Core deposit intangible
8,200

Other real estate owned
1,442

Banked owned life insurance
8,246

Other assets
14,244

Total assets
555,086

 
 

Liabilities assumed:
 

Deposits
483,626

Short-term FHLB advances
14,883

Long-term FHLB advances
778

Subordinated debt
7,530

Other liabilities
5,780

Total liabilities
512,597

Net assets acquired
42,489

Goodwill resulting from merger with HomeTown
$
40,761

The acquired loans were recorded at fair value at the acquisition date without carryover of HomeTown's previously established allowance for loan losses. The fair value of the loans was determined using market participant assumptions in estimating the amount and timing of both principal and interest cash flows expected to be collected on the loans and leases and then applying a market-based discount rate to those cash flows. In this regard, the acquired loans were segregated into pools based on loan type and credit risk. Loan type was determined based on collateral type, purpose, and lien position. Credit risk characteristics included risk rating groups (pass rated loans and adversely classified loans), and past due status. For valuation purposes, these pools were further disaggregated by maturity, pricing characteristics (e.g., fixed-rate, adjustable-rate) and re-payment structure (e.g., interest only, fully amortizing, balloon). If new information is obtained about facts and circumstances about expected cash flows that existed as of the acquisition date, management will adjust fair values in accordance with accounting for business combinations.

13



The acquired loans were divided into loans with evidence of credit quality deterioration which are accounted for under ASC 310-30, Receivables - Loans and Debt Securities Acquired with Deteriorated Credit Quality, (acquired impaired) and loans that do not meet these criteria, which are accounted for under ASC 310-20, Receivables - Nonrefundable Fees and Other Costs, (acquired performing).
The following table presents the acquired impaired loans receivable at the acquisition date (dollars in thousands):
Contractually required principal and interest at acquisition
$
45,551

Contractual cash flows not expected to be collected (nonaccretable difference)
8,296

Expected cash flows at acquisition
37,255

Interest component of expected cash flows (accretable yield)
4,410

Fair value of acquired loans accounted for under FASB ASC 310-30
$
32,845

Direct costs related to the acquisition were expensed as incurred. During the six months ended June 30, 2019, the Company incurred $11.3 million in merger and acquisition integration expenses related to the merger, including $9.1 million in data processing termination and conversion costs, $1.7 million in legal and professional fees, $0.4 million in salary related expense, and $0.1 million in other noninterest expenses. The majority of these expenses were related to integration and are deductible for tax purposes.
The following table presents unaudited pro forma information as if the acquisition of HomeTown had occurred on January 1, 2018. These results combine the historical results of HomeTown in the Company's Consolidated Statements of Income and, while certain adjustments were made for the estimated impact of certain fair value adjustments and other acquisition-related activity, they are not indicative of what would have occurred had the acquisition taken place on January 1, 2018. In particular, no adjustments have been made to eliminate the amount of HomeTown's provision for credit losses that would not have been necessary had the acquired loans been recorded at fair value as of January 1, 2018. Pro forma adjustments below include the net impact of accretion for 2018 and the elimination of merger-related costs for 2019. The Company expects to achieve further operating cost savings and other business synergies as a result of the acquisition which are not reflected in the pro forma amounts below (dollars in thousands, except per share data):
 
Pro forma
Six Months Ended
 
June 30, 2019
 
June 30, 2018
Total revenues (1)
$
45,768

 
$
49,419

Net income
13,382

 
14,755

Earnings per share
1.20

 
1.33

(1) Includes net interest income and noninterest income.
 
Note 3 – Securities 
The amortized cost and fair value of investments in debt securities at June 30, 2019 were as follows (dollars in thousands):
 
June 30, 2019
 
Amortized
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
 
Fair Value
Securities available for sale:
 
 
 
 
 
 
 
Federal agencies and GSEs
$
136,066

 
$
1,594

 
$
647

 
$
137,013

Mortgage-backed and CMOs
135,871

 
1,426

 
398

 
136,899

State and municipal
51,559

 
733

 
47

 
52,245

Corporate
8,016

 
153

 

 
8,169

Total securities available for sale
$
331,512

 
$
3,906

 
$
1,092

 
$
334,326

The Company adopted ASU 2016-01 effective January 1, 2018 and had equity securities with a fair value of $125,000 at June 30, 2019 and recognized in income a $330,000 change in the fair value of equity securities during the first six months of 2019. During the six months ended June 30, 2019, the Company sold $317,000 in equity securities at fair value. The Company had equity securities with a fair value of $2,177,000 at June 30, 2018 and recognized in income a $402,000 change in the fair value of equity securities during the first six months of 2018.

14



The amortized cost and fair value of investments in debt securities at December 31, 2018 were as follows (dollars in thousands):
 
December 31, 2018
 
Amortized
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
 
Fair Value
Securities available for sale:
 
 
 
 
 
 
 
Federal agencies and GSEs
$
137,070

 
$
442

 
$
3,473

 
$
134,039

Mortgage-backed and CMOs
113,883

 
385

 
2,401

 
111,867

State and municipal
80,022

 
411

 
531

 
79,902

Corporate
6,799

 
68

 
22

 
6,845

Total securities available for sale
$
337,774

 
$
1,306

 
$
6,427

 
$
332,653

Restricted Stock
Due to restrictions placed upon the Bank's common stock investment in the Federal Reserve Bank of Richmond ("FRB") and Federal Home Loan Bank of Atlanta ("FHLB"), these securities have been classified as restricted equity securities and carried at cost.  The restricted securities are not subject to the investment security classification and are included as a separate line item on the Company's consolidated balance sheets.  The FRB requires the Bank to maintain stock with a par value equal to 3.00% of its outstanding capital and an additional 3.00% is on call.  The FHLB requires the Bank to maintain stock in an amount equal to 4.25% of outstanding borrowings and a specific percentage of the Bank's total assets. The cost of restricted stock at June 30, 2019 and December 31, 2018 was as follows (dollars in thousands):
 
June 30, 2019
 
December 31, 2018
FRB stock
$
5,045

 
$
3,621

FHLB stock
2,751

 
1,626

Total restricted stock
$
7,796

 
$
5,247

Temporarily Impaired Securities
The following table shows estimated fair value and gross unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at June 30, 2019.  The reference point for determining when securities are in an unrealized loss position is month-end.  Therefore, it is possible that a security's market value exceeded its amortized cost on other days during the past twelve-month period.
Available for sale securities that have been in a continuous unrealized loss position, at June 30, 2019, are as follows (dollars in thousands):
 
Total
 
Less than 12 Months
 
12 Months or More
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
Federal agencies and GSEs
$
86,417

 
$
647

 
$
2,038

 
$
28

 
$
84,379

 
$
619

Mortgage-backed and CMOs
59,842

 
398

 
848

 
2

 
58,994

 
396

State and municipal
10,679

 
47

 

 

 
10,679

 
47

Corporate

 

 

 

 

 

Total
$
156,938

 
$
1,092

 
$
2,886

 
$
30

 
$
154,052

 
$
1,062

Federal agencies and GSEs: The unrealized losses on the Company's investment in 30 government sponsored entities ("GSE") securities were caused by interest rate increases. Seventeen of these securities were in an unrealized loss position for 12 months or more. The contractual terms of those investments do not permit the issuer to settle the securities at a price less than the amortized cost basis of the investments. Because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at June 30, 2019.
Mortgage-backed securities: The unrealized losses on the Company's investment in 41 GSE mortgage-backed securities were caused by interest rate increases. Thirty-six of these securities were in an unrealized loss position for 12 months or more. The contractual cash flows of those investments are guaranteed by an agency of the U.S. Government. Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost basis of the Company's investments. Because the

15



decline in market value is attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at June 30, 2019.
Collateralized Mortgage Obligations: The unrealized loss associated with one private GSE collateralized mortgage obligation ("CMO") was due to normal market fluctuations. This one security was in an unrealized loss position for 12 months or more. The contractual cash flows of that investment is guaranteed by an agency of the U.S. Government. Accordingly, it is expected that the security would not be settled at a price less than the amortized cost basis of the Company's investment. Because the decline in market value is attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell the investment and it is not more likely than not that the Company will be required to sell the investment before recovery of its amortized cost basis, which may be maturity, the Company does not consider the investment to be other-than-temporarily impaired at June 30, 2019.
State and municipal securities:  The unrealized losses on 13 state and municipal securities were caused by interest rate increases. Thirteen of these securities were in an unrealized loss position for 12 months or more. The contractual terms of those investments do not permit the issuer to settle the securities at a price less than the amortized cost basis of the investments. Because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at June 30, 2019.
Corporate securities:  There were no corporate bonds in an unrealized loss position at June 30, 2019.
Restricted stock: When evaluating restricted stock for impairment, its value is based on the ultimate recoverability of the par value rather than by recognizing temporary declines in value. The Company does not consider restricted stock to be other-than-temporarily impaired at June 30, 2019, and no impairment has been recognized.
The table below shows estimated fair value and gross unrealized losses, aggregated by investment category and length of time that individual securities had been in a continuous unrealized loss position, at December 31, 2018 (dollars in thousands):
 
Total
 
Less than 12 Months
 
12 Months or More
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
Federal agencies and GSEs
$
103,797

 
$
3,473

 
$
14,982

 
$
8

 
$
88,815

 
$
3,465

Mortgage-backed and CMOs
86,852

 
2,401

 
5,473

 
15

 
81,379

 
2,386

State and municipal
39,755

 
531

 
7,199

 
18

 
32,556

 
513

Corporate
484

 
22

 

 

 
484

 
22

Total
$
230,888

 
$
6,427

 
$
27,654

 
$
41

 
$
203,234

 
$
6,386

Other-Than-Temporarily-Impaired Securities 
As of June 30, 2019 and December 31, 2018, there were no securities classified as other-than-temporarily impaired.

16



Realized Gains and Losses
The following table presents the gross realized gains and losses on and the proceeds from the sale of securities available for sale during the three and six months ended June 30, 2019 and 2018 (dollars in thousands):
 
Three Months Ended June 30, 2019
 
Six Months Ended June 30, 2019
Realized gains (losses):
 
 
 
Gross realized gains
$
190

 
$
194

Gross realized losses
(54
)
 
(54
)
Net realized gains
$
136

 
$
140

Proceeds from sales of securities
$
29,878

 
$
29,878

 
 
 
 
 
Three Months Ended June 30, 2018
 
Six Months Ended June 30, 2018
Realized gains (losses):
 
 
 
Gross realized gains
$

 
$
105

Gross realized losses

 
(97
)
Net realized gains
$

 
$
8

Proceeds from sales of securities
$

 
$
22,066

Note 4 – Loans
Loans, excluding loans held for sale, at June 30, 2019 and December 31, 2018, were comprised of the following (dollars in thousands):
 
June 30, 2019
 
December 31, 2018
Commercial
$
340,427

 
$
285,972

Commercial real estate:
 

 
 

Construction and land development
152,876

 
97,240

Commercial real estate
880,146

 
655,800

Residential real estate:
 

 
 

Residential
328,400

 
209,438

Home equity
121,905

 
103,933

Consumer
12,487

 
5,093

Total loans
$
1,836,241

 
$
1,357,476

Acquired Loans 
The outstanding principal balance and the carrying amount of these loans, including loans accounted for under ASC 310-30, included in the consolidated balance sheets at June 30, 2019 and December 31, 2018 are as follows (dollars in thousands):
 
June 30, 2019
 
December 31, 2018
Outstanding principal balance
$
482,640

 
$
63,619

Carrying amount
464,419

 
58,886

The outstanding principal balance and related carrying amount of acquired impaired loans, for which the Company applies ASC 310-30 to account for interest earned, as of the indicated dates are as follows (dollars in thousands):
 
June 30, 2019
 
December 31, 2018
Outstanding principal balance
$
62,006

 
$
24,500

Carrying amount
51,297

 
20,611


17



The following table presents changes in the accretable yield on acquired impaired loans, for which the Company applies ASC 310-30, for the six months ended June 30, 2019 and the year ended December 31, 2018 (dollars in thousands):
 
June 30, 2019
 
December 31, 2018
Balance at January 1
$
4,633

 
$
4,890

Additions from merger with HomeTown
4,410

 

Accretion
(1,527
)
 
(2,362
)
Reclassification from nonaccretable difference
222

 
956

Other changes, net*
283

 
1,149

 
$
8,021

 
$
4,633

* This line item represents changes in the cash flows expected to be collected due to the impact of non-credit changes such as prepayment assumptions, changes in interest rates on variable rate acquired impaired loans, and discounted payoffs that occurred in the period.
Past Due Loans
The following table shows an analysis by portfolio segment of the Company's past due loans at June 30, 2019 (dollars in thousands):
 
30- 59 Days
Past Due
 
60-89 Days
Past Due
 
90 Days +
Past Due
and Still
Accruing
 
Non-
Accrual
Loans
 
Total
Past
Due
 
Current
 
Total
Loans
Commercial
$
313

 
$
1,168

 
$
4

 
$
49

 
$
1,534

 
$
338,893

 
$
340,427

Commercial real estate:
 

 
 

 
 

 
 

 
 

 
 

 
 

Construction and land development
211

 
130

 
53

 
23

 
417

 
152,459

 
152,876

Commercial real estate
1,951

 

 
465

 
116

 
2,532

 
877,614

 
880,146

Residential:
 

 
 

 
 

 
 

 
 

 
 

 
 

Residential
743

 
841

 
408

 
706

 
2,698

 
325,702

 
328,400

Home equity
101

 
220

 

 
75

 
396

 
121,509

 
121,905

Consumer
24

 

 

 

 
24

 
12,463

 
12,487

Total
$
3,343

 
$
2,359

 
$
930

 
$
969

 
$
7,601

 
$
1,828,640

 
$
1,836,241

The following table shows an analysis by portfolio segment of the Company's past due loans at December 31, 2018 (dollars in thousands):
 
30- 59 Days
Past Due
 
60-89 Days
Past Due
 
90 Days +
Past Due
and Still
Accruing
 
Non-
Accrual
Loans
 
Total
Past
Due
 
Current
 
Total
Loans
Commercial
$
20

 
$

 
$

 
$
83

 
$
103

 
$
285,869

 
$
285,972

Commercial real estate:
 

 
 

 
 

 
 

 
 

 
 

 
 

Construction and land development

 

 

 
27

 
27

 
97,213

 
97,240

Commercial real estate
42

 

 

 
197

 
239

 
655,561

 
655,800

Residential:
 

 
 

 
 

 
 

 
 

 
 

 
 

Residential
456

 
157

 
72

 
659

 
1,344

 
208,094

 
209,438

Home equity
126

 

 

 
124

 
250

 
103,683

 
103,933

Consumer
21

 
3

 

 

 
24

 
5,069

 
5,093

Total
$
665

 
$
160

 
$
72

 
$
1,090

 
$
1,987

 
$
1,355,489

 
$
1,357,476


18



Impaired Loans
The following table presents the Company's impaired loan balances by portfolio segment, excluding acquired impaired loans, at June 30, 2019 (dollars in thousands):
 
Recorded
Investment
 
Unpaid
Principal
Balance
 
Related
Allowance
 
Average
Recorded
Investment
 
Interest
Income
Recognized
With no related allowance recorded:
 
 
 
 
 
 
 
 
 
Commercial
$
4

 
$
4

 
$

 
$
11

 
$

Commercial real estate:
 

 
 

 
 

 
 

 
 

Construction and land development

 

 

 

 

Commercial real estate
348

 
346

 

 
362

 
14

Residential:
 

 
 

 
 

 
 

 
 

Residential
641

 
640

 

 
640

 
17

Home equity
45

 
45

 

 
47

 
3