What changed in this filing

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Item 1. Financial Statements

2026-05-13 compared with 2025-11-13 · 133 added, 325 removed, 594 unchanged (44% of the section changed)

2 unchanged sentences

Consol idated Balance Sheets

September 30,

(in thousands, except share and per share data)

March 31, 2026

December 31, 2025

Cash and due from banks

Interest-bearing deposits

Federal funds sold

Total cash and cash equivalents

9 unchanged sentences

Loans, net of deferred fees and costs

allowance for credit losses

allowance for credit losses on loans

Premises and equipment, net

17 unchanged sentences

Authorized 10,000,000 shares;

issued and outstanding 6,366,001 (including 5,028 unvested) shares as of September 30, 2025 and 6,363,371 (including 4,961 unvested) shares as of December 31, 2024

issued and outstanding 6,368,410 (including 5,039 unvested) shares as of March 31, 2026 and December 31, 2025

Retained earnings

4 unchanged sentences

National Bankshares, Inc.

Consolidated Statements of Income

Three Months Ended September 30,

(in thousands, except share and per share data)

Interest Income

Interest and fees on loans

Interest on federal funds sold

Interest on interest-bearing deposits

Interest on securities – taxable

Interest on securities – nontaxable

Total interest income

Interest Expense

Interest on time deposits

Interest on other deposits

Interest on borrowings

Total interest expense

Net interest income

Provision for (recovery of) credit losses

Net interest income after provision for (recovery of) credit losses

Noninterest Income

Service charges on deposit accounts

Other service charges and fees

Credit and debit card fees, net

Gain on sale of mortgage loans held for sale

Total noninterest income

Noninterest Expense

Salaries and employee benefits

Occupancy, furniture and fixtures

Data processing

FDIC assessment

Intangible asset amortization

Franchise taxes

Professional services

Merger-related expense

Core system conversion expense

Other operating expenses

Total noninterest expense

Income before income tax expense

Income tax expense

Basic net income per common share

Diluted net income per common share

Weighted average number of common shares outstanding, basic

Weighted average number of common shares outstanding, diluted

See accompanying notes to consolidated financial statements.

National Bankshares, Inc.

Consolidated Statements of Comprehensive Income

Three Months Ended September 30, 2025 and 2024

Three months ended September 30,

(in thousands)

Other Comprehensive Income, Net of Tax

Unrealized holding gain on available for sale securities net of tax of $ 1,599 and

$ 4,284 for the periods ended September 30, 2025 and 2024, respectively

Other comprehensive income, net of tax

Total Comprehensive Income

See accompanying notes to consolidated financial statements.

National Bankshares, Inc.

Consolidated Statements of Income

For the Nine Months Ended September 30,

Consoli dated Statements of Income

For the Three Months Ended March 31,

(in thousands, except share and per share data)

9 unchanged sentences

Interest on other deposits

Interest on borrowings

Total interest expense

Net interest income

Provision for credit losses

Net interest income after provision for credit losses

(Recovery of) provision for credit losses

Net interest income after (recovery of) provision for credit losses

Noninterest Income

12 unchanged sentences

Professional services

Merger-related expense

Core system conversion expense

7 unchanged sentences

Weighted average number of common shares outstanding, diluted

Dividends declared per common share

See accompanying notes to consolidated financial statements.

1 unchanged sentence

Consolidate d Statements of Comprehensive Income

Nine Months Ended September 30, 2025 and 2024

For the Nine Months Ended September 30,

Three Months Ended March 31, 2026 and 2025

For the Three Months Ended March 31,

(in thousands)

Other Comprehensive Income, Net of Tax

Unrealized holding gain on available for sale securities net of tax of $ 4,616 and

$ 3,357 for the periods ended September 30, 2025 and 2024, respectively

Other comprehensive income, net of tax

Other Comprehensive (Loss) Income, Net of Tax

Unrealized holding (loss) gain on available for sale securities net of tax of ($ 680 ) and

$ 2,017 for the periods ended March 31, 2026 and 2025, respectively

Other comprehensive (loss) income, net of tax

Total Comprehensive Income

2 unchanged sentences

Consolidated Statem ents of Changes in Stockholders’ Equity

Three Months Ended September 30, 2025 and 2024

(in thousands, except share data)

Common Stock and Additional Paid-in Capital

Retained Earnings

Accumulated Other Comprehensive Loss

Balances at June 30, 2024

Other comprehensive income, net of tax of $ 4,284

Stock based compensation

Balances at September 30, 2024

Balances at June 30, 2025

Other comprehensive income, net of tax of $ 1,599

Stock based compensation

Balances at September 30, 2025

Nine Months Ended September 30, 2025 and 2024

Three Months Ended March 31, 2026 and 2025

(in thousands except per share data)

2 unchanged sentences

Balances at December 31, 2024

Acquisition of Frontier Community Bank

Cash dividends of $ 0.73 per share

Other comprehensive income, net of tax of $ 2,017

Stock based compensation

Balances at September 30, 2024

Balances at March 31, 2025

Balances at December 31, 2025

Cash dividends of $ 0.73 per share

Other comprehensive income, net of tax of $ 4,616

Other comprehensive (loss), net of tax of ($ 680 )

Stock based compensation

Balances at September 30, 2025

Balances at March 31, 2026

See accompanying notes to consolidated financial statements.

1 unchanged sentence

Consolidat ed Statements of Cash Flows

Nine Months Ended September 30, 2025 and 2024

For the Nine Months Ended September 30,

Three Months Ended March 31, 2026 and 2025

For the Three Months Ended March 31,

(in thousands)

1 unchanged sentence

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

Provision for credit losses

(Recovery of) provision for credit losses

Depreciation of premises and equipment

7 unchanged sentences

Increase in cash value of bank-owned life insurance

Gain on disposal of premises and equipment, net

Equity based compensation expense

14 unchanged sentences

Purchases of premises and equipment

Proceeds from sale of premises and equipment

Cash acquired in the acquisition, net of cash paid

Net cash used in investing activities

Net cash provided by investing activities

Cash Flows from Financing Activities

1 unchanged sentence

Net change in other deposits

Cash dividends paid

Net change in borrowings

Net cash used in financing activities

2 unchanged sentences

Cash and cash equivalents at end of period

For the Nine Months Ended September 30,

For the Three Months Ended March 31,

(in thousands)

4 unchanged sentences

Loans charged against the allowance for credit losses

Unrealized holding gain on securities available for sale

Lease liabilities arising from obtaining right-of-use assets during the period

Unrealized holding (loss) gain on securities available for sale

See accompanying notes to consolidated financial statements.

1 unchanged sentence

Notes t o Consolidated Financial Statements

September 30, 2025

March 31, 2026

$ in thousands, except per share data

10 unchanged sentences

Certain policies inherently rely more extensively on the use of estimates, assumptions, and judgments and as such may have a greater possibility of producing results that could be materially different than originally reported.

Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for credit losses on loans and acquisition accounting.

The results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of results of operations for the full year or any other interim period.

Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance of credit losses on loans and pension plan.

The results of operations for the three months ended March 31, 2026 are not necessarily indicative of results of operations for the full year or any other interim period.

The interim period consolidated financial statements and financial information included in this Form 10-Q 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, 2025 (“2025 Form 10-K”).

10 unchanged sentences

These risks could adversely affect the Company’s business, financial condition, results of operations, cash flows, credit risk, asset valuations and capital position.

Recently Adopted Accounting Developments

In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) 2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.” The amendments in this ASU require an entity to disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold, which is greater than five percent of the amount computed by multiplying pretax income by the entity’s applicable statutory rate, on an annual basis.

Additionally, the amendments in this ASU require an entity to disclose the amount of income taxes paid (net of refunds received) disaggregated by federal, state, and foreign taxes and the amount of income taxes paid (net of refunds received) disaggregated by individual jurisdictions that are equal to or greater than five percent of total income taxes paid (net of refunds received).

Lastly, the amendments in this ASU require an entity to disclose income (or loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic and foreign and income tax expense (or benefit) from continuing operations disaggregated by federal, state, and foreign.

ASU 2023-09 was effective for the Company on January 1, 2025 and applies to annual periods beginning after December 15, 2024.

Adoption of ASU 2023-09 is not expected to have a material impact on the Company’s consolidated financial statements.

Recent Accounting Pronouncements

In November 2025, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) 2025-08, “Financial Instruments—Credit Losses (Topic 326):

Purchased Loans.” The amendments in this ASU expand the population of acquired financial assets accounted for using the gross-up approach.

Acquired loans (excluding credit cards) are deemed purchased seasoned loans and accounted for using the gross-up approach upon acquisition if criteria established by the new guidance are met.

This change aims to enhance comparability, consistency, and better reflect the economics of acquiring financial assets.

This ASU is effective for annual reporting periods beginning after December 15, 2026, and for interim reporting periods within those annual reporting periods.

Early adoption is permitted in an interim or annual reporting period in which financial statements have not yet been issued or made available for issuance.

If an entity adopts this ASU in an interim reporting period, it should apply it as of the beginning of that interim reporting period or the beginning of the annual reporting period that includes that interim reporting period.

The Company does not expect the adoption of ASU 2025-08 to have a material impact on its consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses.” ASU 2024-03 requires public

companies to disclose, in the notes to the financial statements, specific information about certain costs and expenses at each interim and annual reporting period.

Disaggregation of Income Statement Expenses.” ASU 2024-03 requires public companies to disclose, in the notes to the financial statements, specific information about certain costs and expenses at each interim and annual reporting period.

This includes disclosing amounts related to employee compensation, depreciation, and intangible asset54amortization.

In addition, public companies will need to provide qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively.

The FASB subsequently issued ASU 2025-01, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

The FASB subsequently issued ASU 2025-01, “Income

Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Clarifying the Effective Date”, which amends the effective date of ASU 2024-03 to clarify that all public business entities are required to adopt the guidance in ASU 2024-03 in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027.

2 unchanged sentences

The Company does not expect the adoption of ASU 2024-03 to have a material impact on its consolidated financial statements.

Business Combination

On June 1, 2024 (the “Acquisition Date”), the Company completed its acquisition of Frontier Community Bank ("FCB"), a Virginia chartered commercial bank headquartered in Waynesboro, Virginia, in accordance with the definitive merger agreement entered on January 23, 2024, by and among the Company, the Bank and FCB.

Upon completion of the merger, FCB merged with and into the Bank.

Each share of FCB common stock was converted into either $ 14.48 in cash or 0.4250 shares of the Company’s common stock, with FCB shareholders having the ability to elect the merger consideration to be received, subject to the allocation and proration procedures set forth in the FCB Merger Agreement.

The Company issued 464,855 shares of common stock and paid cash consideration of $ 2,050 to former FCB shareholders in the acquisition.

As a result of the transaction, the Bank expanded its operations into the Waynesboro, Staunton and Lynchburg, Virginia markets.

The acquisition of FCB was accounted for as a business combination using the acquisition method of accounting.

Assets acquired, liabilities assumed, and consideration paid were recorded at estimated fair value on the Acquisition Date.

The excess of the purchase price over the fair value of the net assets was recorded as provisional goodwill and represents the benefit from the transaction that is not otherwise quantifiable, including expected management and operational synergies and intangible assets that do not qualify for separate recognition.

The Company does not expect that any portion of goodwill will be deductible.

Please refer to the Company’s 2024 Form 10-K, Note 22:

Business Combination for additional information regarding the acquisition of FCB.

The following table presents the calculation of the purchase price and the fair value of the identifiable assets and liabilities as of the Acquisition Date.

As Recorded by FCB

Estimated Fair Value Adjustments

Estimated Fair Values as Recorded by NBI

Purchase Price Consideration:

Stock consideration (1)

Cash consideration (2)

Total purchase price consideration

Identifiable assets:

Cash and cash equivalents

Loans, gross, purchased performing

Loans, gross, purchased credit deteriorated

Loans in process

Deferred fees and costs on loans

Allowance for credit losses on loans

Premises and equipment

Core deposit intangible

Total identifiable assets acquired

Identifiable Liabilities

Other liabilities

Total identifiable liabilities assumed

Fair value of net assets acquired

(1) The Company issued 464,855 shares of its common stock valued at $ 30.76 per share, which was the closing price of the Company’s common stock on May 31, 2024, the last day of trading prior to the consummation of the acquisition.

(2) Cash consideration was paid for shareholder elections, fractional shares and to settle outstanding vested stock options.

The merger agreement provided for up to 10 % of consideration to be paid in cash of $ 14.48 per FCB common share, at the shareholders’ election.

Payments for shareholder elections and fractional shares totaled $ 1,769 .

Outstanding and vested options were settled at the difference between $ 14.48 and the strike price and totaled $ 281 .

(3) The Company kept the measurement of goodwill open until December 31, 2024 in order to reflect any adjustments to the fair value of assets acquired and liabilities assumed that arose during the Company’s final review procedures.

The Company recorded a small measurement period adjustment to goodwill between the acquisition date and December 31, 2024.

For more information, please refer to the Company’s 2024 Form 10-K, Note 17:

Goodwill and Other Intangibles.

Loans and Allowance for Credit Losses

Loans include acquired loans and originated loans.

Acquired loans are presented at their outstanding principal balance, net of the remaining purchase discount of $ 6,239 as of September 30, 2025 and $ 7,564 as of December 31, 2024.

Originated loans as of September 30, 2025 and December 31, 2024 are presented at amortized cost, net of deferred fees and costs.

Acquired loans are presented at their outstanding principal balance, net of the remaining purchase discount of $ 5,134 as of March 31, 2026 and $ 5,551 as of December 31, 2025.

Originated loans as of March 31, 2026 and December 31, 2025 are presented at amortized cost, net of deferred fees and costs.

The following table presents the composition of the loan portfolio, excluding mortgage loans held for sale, as of the dates indicated.

September 30,

Real estate construction

4 unchanged sentences

Consumer non real estate

Less deferred fees and costs

deferred fees and costs

Loans, net of deferred fees and costs

1 unchanged sentence

Total loans, net

Accrued interest receivable of $ 3,357 at September 30, 2025 and $ 3,299 at December 31, 2024 is not included in total loans above.

Accrued interest receivable of $ 3,568 at March 31, 2026 and $ 3,361 at December 31, 2025 is not included in total loans above and is also excluded from the Company's estimate of credit losses on loans.

Past Due and Nonaccrual Loans

The following tables present the aging of past due loans, by loan pool, as of the dates indicated.

September 30, 2025

March 31, 2026

Real Estate Construction

34 unchanged sentences

The following table presents nonaccrual loans, by loan class, as of the dates indicated:

September 30, 2025

March 31, 2026

December 31, 2025

1 unchanged sentence

Commercial real estate, owner-occupied

No accrued interest receivable was reversed against interest income during the three and nine months ended September 30, 2025 or September 30, 2024.

Commercial real estate, other

No accrued interest receivable was reversed against interest income during the three months ended March 31, 2026 or March 31, 2025.

Allowance for Credit Losses on Loans (“ACLL”)

The following tables present the activity in the ACLL by portfolio segment for the periods indicated:

Activity in the ACLL for the Nine Months Ended September 30, 2025

Activity in the ACLL for the Three Months Ended March 31, 2026

Balance, December 31, 2025

Provision for (recovery of) credit losses

Balance, September 30, 2025

Activity in the ACLL for the Nine Months Ended September 30, 2024

Balance, March 31, 2026

Activity in the ACLL for the Three Months Ended March 31, 2025

Balance, December 31, 2024

Provision for (recovery of) credit losses

Merger adjustment (1)

Balance, September 30, 2024

Balance, March 31, 2025

Activity in the ACLL for the Year Ended December 31, 2025

1 unchanged sentence

Provision for (recovery of) credit losses

Merger adjustment (1)

Balance, December 31, 2025

2 unchanged sentences

ACLL by Segment and Evaluation Method

September 30, 2025

March 31, 2026

Real Estate Construction

12 unchanged sentences

Loans by Segment and Evaluation Method

September 30, 2025

March 31, 2026

Real Estate Construction

17 unchanged sentences

If the fair value of the collateral exceeds the amortized cost, no ACLL is required.

As of September 30, 2025 and December 31, 2024, three of the Company’s individually evaluated loans were collateral dependent and secured by real estate.

As of March 31, 2026 and December 31, 2025, two of the Company’s individually evaluated loans were collateral dependent and secured by real estate.

The following table provides detail on collateral dependent loans as of the dates indicated:

September 30, 2025

March 31, 2026

December 31, 2025

13 unchanged sentences

loans with well-defined weaknesses that heighten the risk of default are rated classified.

The following tables present the amortized cost basis of the loan portfolio by year of origination, loan class and credit quality as of September 30, 2025 and December 31, 2024, and gross charge-offs by year of origination for the nine months ended September 30, 2025 and the year ended December 31, 2024 .

The following tables present the amortized cost basis of the loan portfolio by year of origination, loan class and credit quality as of March 31, 2026 and December 31, 2025, and gross charge-offs by year of origination for the three months ended March 31, 2026 and the year ended December 31, 2025 .

Term Loans Amortized Cost Basis by Origination Year

September 30, 2025

March 31, 2026

Construction, residential

8 unchanged sentences

Commercial real estate, other

Special Mention

Commercial and industrial

1 unchanged sentence

Public sector and IDA

Special Mention

Other consumer

1 unchanged sentence

Special Mention

Gross Charge Offs by Origination Year for the Nine Months Ended September 30, 2025

Residential closed-end first liens

Gross Charge Offs by Origination Year for the Three Months Ended March 31, 2026

Commercial and industrial

Other consumer

8 unchanged sentences

Investor-owned residential real

Special mention

Multifamily residential real

3 unchanged sentences

Commercial and industrial

Public sector and IDA

Special mention

Public sector and IDA

Other Consumer

1 unchanged sentence

Special mention

Gross Charge Offs by Origination Year for the Twelve Monts Ended December 31, 2024

Gross Charge Offs by Origination Year for the Year Ended December 31, 2025

Residential closed-end first liens

Commercial and industrial

Other consumer

Total YTD gross charge-offs

Total Gross Charge-offs

Loan Modifications to Borrowers Experiencing Financial Difficulty

On the date a loan is modified, the Company assesses whether the borrower is experiencing financial difficulty.

If the borrower is experiencing financial difficulty, the loan is risk rated special mention or classified, as appropriate.

If the borrower is experiencing financial difficulty, the loan is risk rated special mention or classified, as determined appropriate.

If the loan exceeds $ 400 , if it is placed in nonaccrual, or if foreclosure is probable, the loan is individually evaluated for the ACLL.

During the three and nine months ended September 30, 2025, no loans were modified for borrowers experiencing financial difficulty.

Two loans were modified for borrowers experiencing financial difficulty during the first three months of 2024.

These loans were modified again during the three month period ended September 30, 2024.

The following table presents information as of September 30, 2024 about loans modified for borrowers experiencing financial difficulty during the nine months ended September 30, 2024.

September 30, 2024

Financial Effect

Commercial Real Estate

Commercial real estate owner-occupied

Interest only

3 months of interest only payments, re-amortization of the balance to contractual maturity

Commercial Non real estate

Commercial and industrial

Term extension

Renewal of single-payment note for an additional 3 months

The Company closely monitors the performance of loans that are modified for borrowers experiencing financial difficulty.

As of September 30, 2024, the loans were in current status and individually evaluated.

There were no modified loans to borrowers experiencing financial difficulty that had a payment default during the three or nine months ended September 30, 2025 and 2024 and that were modified in the twelve months prior.

Default occurs when a payment is 90 days past due, the loan is fully or partially charged off or the Company forecloses on the collateral.

No loans were modified for borrowers experiencing financial difficulty during the three months ended March 31, 2026 or March 31, 2025.

Consumer Real Estate Loans In Process of Foreclosure

As of September 30, 2025 , the Company had no consumer real estate loans in process of foreclosure.

As of March 31, 2026 , the Company had six consumer real estate loans with an amortized cost of $ 289 in process of foreclosure.

As of December 31, 2025 , three consumer real estate loans totaling $ 126 were in process of foreclosure.

ACL for Unfunded Commitments

The following tables present the balance and activity in the ACL for unfunded commitments for the nine months ended September 30, 2025 and 2024:

The following tables present the balance and activity in the ACL for unfunded commitments for the three months ended March 31, 2026 and 2025:

Allowance for Credit Losses on Unfunded Commitments

Balance, December 31, 2025

Provision for credit losses

Balance, September 30, 2025

Recovery of credit losses

Balance, March 31, 2026

Balance, December 31, 2024

Recovery of credit losses

FCB acquisition

Balance, September 30, 2024

Balance, March 31, 2025

The amortized cost and estimated fair value of securities available for sale along with gross unrealized gains and losses as of the dates indicated are summarized as follows:

September 30, 2025

March 31, 2026

government agencies and corporations

12 unchanged sentences

12 Months or More

September 30, 2025

March 31, 2026

government agencies and corporations

13 unchanged sentences

Consideration is given to the extent to which the fair value is less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of the Company to retain its investment in the security for a period of time sufficient to allow for any anticipated recovery in fair value.

At September 30, 2025, the Company had 534 securities with a fair value of $ 603,882 in an unrealized loss position.

At March 31, 2026, the Company had 516 securities with a fair value of $ 612,417 in an unrealized loss position.

The Company reviews securities in an unrealized loss position to evaluate credit risk.

The Company considers payment history, risk ratings from external parties, financial statements for municipal and corporate securities, public statements from issuers and other available credible published sources in evaluating credit risk.

No credit losses were identified and no ACL on securities available for sale was recorded as of September 30, 2025 or December 31, 2024.

No credit losses were found and no ACL on securities available for sale was recorded as of March 31, 2026.

The unrealized losses are attributed to noncredit-related factors, including changes in interest rates and other market conditions.

The Company does not have the intent to sell any of these securities and believes that it is

more likely than not that the Company will not have to sell any such securities before a recovery of cost.

The Company does not have the intent to sell any of these securities and believes that it is more likely than not that the Company will not have to sell any such securities before a recovery of cost.

The contractual terms of the investments do not permit the issuers to settle the securities at a price less than the cost basis of the investments.

The fair value is expected to recover as the securities approach their maturity date or repricing date or if market yields for such investments decline.

The amortized cost and fair value of securities available for sale at September 30, 2025, by contractual maturity, are shown below.

The amortized cost and fair value of securities available for sale at March 31, 2026, by contractual maturity, are shown below.

Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Mortgage-backed securities included in these totals are categorized by final maturity.

September 30, 2025

March 31, 2026

Amortized Cost

5 unchanged sentences

Total securities available for sale

Accrued interest receivable on securities, included in accrued interest receivable on the Consolidated Balance Sheets, totaled $ 3,320 at September 30, 2025 and $ 3,170 at December 31, 2024.

The deferred tax asset for the net unrealized loss on securities available for sale was $ 11,889 as of September 30, 2025 and $ 16,506 as of December 31, 2024.

Accrued interest receivable on securities, included in accrued interest receivable on the Consolidated Balance Sheets, totaled $ 3,433 at March 31, 2026 and $ 3,177 at December 31, 2025.

The deferred tax asset for the net unrealized loss on securities available for sale was $ 11,568 as of March 31, 2026 and $ 10,889 as of December 31, 2025.

The deferred tax asset is included in other assets on the Consolidated Balance Sheets.

Realized Securities Gains and Losses

There were no sales of securities during the nine months ended September 30, 2025 and 2024.

There were no sales of securities during the three months ended March 31, 2026 and 2025.

Restricted Stock.

The Company held restricted stock of $ 3,748 as of September 30, 2025 and $ 1,848 as of December 31, 2024 included in other assets on the Consolidated Balance Sheets.

The Company held restricted stock of $ 1,872 as of March 31, 2026 and $ 1,848 as of December 31, 2025.

Restricted stock is reported separately from available for sale securities and is included in other assets on the Consolidated Balance Sheets.

As a member of the Federal Reserve and the Federal Home Loan Bank of Atlanta (“FHLB”), NBB is required to maintain certain minimum investments in the common stock of those entities.

4 unchanged sentences

At its discretion, the FHLB may declare dividends on the stock.

In addition to dividends, NBB also benefits from its membership with FHLB through eligibility to borrow from the FHLB, using as collateral NBB’s capital stock investment in the FHLB and qualifying NBB real estate mortgage loans totaling $ 515,009 at September 30, 2025.

The Company’s management reviews for impairment based upon the ultimate recoverability of the cost basis of the FHLB stock, and at September 30, 2025 , did not determine any impairment.

The Company’s management reviews for impairment based upon the ultimate recoverability of the cost basis of the FHLB stock, and at March 31, 2026 , did not determine any impairment.

Defined Benefit Plan

1 unchanged sentence

Net Periodic Benefit Income

Three Months Ended September 30,

Interest cost

Expected return on plan assets

Recognized net actuarial loss

Net periodic benefit income

Net Periodic Benefit Income

Nine Months Ended September 30,

Three Months Ended March 31,

Interest cost

Expected return on plan assets

Recognized net actuarial loss

Net periodic benefit income

27 unchanged sentences

Third party vendors compile prices from various sources and may determine the fair value of identical or similar securities by using pricing models that consider observable market data (Level 2).

The carrying value of restricted Federal Reserve Bank of Richmond and FHLB stock approximates fair value based upon the redemption provisions of each entity and is therefore excluded from the following tables.

The following tables present the balances of financial assets measured at fair value on a recurring basis as of the dates indicated.

Fair Value Measurement Using

September 30, 2025

March 31, 2026

government agencies and corporations

26 unchanged sentences

As such, the Company records any fair value adjustments on a nonrecurring basis.

No nonrecurring fair value adjustments were recorded on loans held for sale at September 30, 2025 or December 31, 2024.

No nonrecurring fair value adjustments were recorded on loans held for sale at March 31, 2026 or December 31, 2025.

Collateral Dependent Loans

11 unchanged sentences

Likewise, values for inventory and accounts receivables collateral are based on financial statement balances or aging reports (Level 3).

As of September 30, 2025 , three commercial real estate loans totaling $ 8,791 were collateral dependent.

As of March 31, 2026 , two commercial real estate loans totaling $ 6,884 were collateral dependent.

Valuation was based upon outside appraisals (Level 2).

None of the measurements resulted in a specific allocation.

As of December 31, 2024, three commercial real estate loans totaling $ 9,259 were measured under the fair value of collateral method using third party appraisals (Level 2).

As of December 31, 2025, two commercial real estate loans totaling $ 6,921 were measured under the fair value of collateral method using third party appraisals (Level 2).

None of the measurements resulted in a specific allocation.

3 unchanged sentences

Estimated Fair Value

September 30, 2025

March 31, 2026

Carrying Amount

15 unchanged sentences

Interest-bearing deposits

Federal funds sold

Securities available for sale

Restricted stock, at cost

Mortgage loans held for sale

Accrued interest receivable

4 unchanged sentences

The following tables provide information about components of accumulated other comprehensive loss as of the dates indicated:

Net Unrealized Loss on Securities

Adjustments Related to Pension Benefits

Accumulated Other Comprehensive Loss

Balance at June 30, 2024

Unrealized holding gain on available for sale securities, net of

tax of $ 4,284

Balance at September 30, 2024

Balance at June 30, 2025

Unrealized holding gain on available for sale securities, net of

tax of $ 1,599

Balance at September 30, 2025

Comprehensive

2 unchanged sentences

tax of $ 2,017

Balance at September 30, 2024

Balance at March 31, 2025

Balance at December 31, 2025

Unrealized holding gain on available for sale securities, net of

Unrealized holding loss on available for sale securities, net of

tax of ($ 680 )

Balance at September 30, 2025

Balance at March 31, 2026

Revenue Recognition

8 unchanged sentences

Payment for service charges on deposit accounts is primarily received immediately or in the following month through a direct charge to customers’ accounts.

ATM fees are generated when a Company cardholder uses a non-Company ATM.

ATM fees are primarily generated when a Company cardholder uses a non-Company ATM or a non-Company cardholder uses a Company ATM.

Wire transfer fees, overdraft and nonsufficient funds fees and other deposit account related fees are transactional based, and therefore, the Company’s performance obligation is satisfied, and related revenue recognized, at a point in time.

Other Service Charges and Fees

Other service charges include safe deposit box rental fees, check ordering charges, ATM fees to holders of cards issued by other banks and other service charges.

Other service charges include safe deposit box rental fees, check ordering charges, and other service charges.

Safe deposit box rental fees are charged to the customer on an annual basis and recognized upon receipt of payment.

The Company determined that since rentals and renewals occur fairly consistently over time, revenue is recognized on a basis consistent with the duration of the performance obligation.

Check ordering charges, ATM fees to holders of cards issued by other banks and other service charges are transaction based and therefore, the Company’s performance obligation is satisfied and related revenue recognized at a point in time.

Check ordering charges are transaction based and therefore, the Company’s performance obligation is satisfied and related revenue recognized at a point in time.

Credit and Debit Card Fees

7 unchanged sentences

The Company’s performance obligation is generally satisfied over time and the resulting fees are recognized monthly, based upon the month-end market value of the assets under management and the applicable fee rate.

Payment is generally received a few days after month end through a direct charge to customers’ accounts.

Payment is generally received a few days

after month end through a direct charge to customers’ accounts.

The Company does not earn performance-based incentives.

management fees are based upon the size of the estate.

Estate management fees are based upon the size of the estate.

A partial fee is recognized half-way through the estate administration and the remainder of the fee is recognized when remaining assets are distributed and the estate is closed.

3 unchanged sentences

The Company’s performance obligation is generally satisfied upon the issuance of the insurance policy.

Shortly after the insurance policy is issued, the carrier remits the commission payment to the Company, and the Company recognizes the revenue.

The Company recognizes revenue upon receipt of commission shortly after the insurance policy is issued.

Investment income consists of recurring revenue streams such as commissions from sales of mutual funds, annuities and other investments.

3 unchanged sentences

The following presents noninterest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the periods indicated.

Three Months Ended September 30,

Noninterest Income

In-scope of Topic 606:

Service charges on deposit accounts

Other service charges and fees

Credit and debit card fees, net

Insurance and Investment (1)

Noninterest Income (in-scope of Topic 606)

Noninterest Income (out-of-scope of Topic 606)

Total noninterest income

Nine Months Ended September 30,

Three Months Ended March 31,

Noninterest Income

8 unchanged sentences

(1) Included within other income in the Consolidated Statements of Income

The Company’s leases are recorded under ASC Topic 842, “Leases”.

The Company categorizes leases as short-term, operating or finance leases.

6 unchanged sentences

Counterparties for the Company’s lease contracts are external to the Company and not related parties.

On June 1, 2024, the Company’s acquisition of FCB added two long-term branch leases.

At the Acquisition Date, the leases were remeasured using the Company’s incremental borrowing rate and remaining lease terms, resulting in an increase of $ 548 to the right of use asset and the lease liability.

Lease payments

5 unchanged sentences

Certain of the Company’s operating leases offer the option to extend the lease term and the Company has included such extensions in its calculation of the lease liabilities to the extent the options are reasonably certain of being exercised.

The lease agreements do not provide for residual value guarantees and have no restrictions or covenants that would impact dividends or require incurring additional financial obligations.

The lease agreements do not

provide for residual value guarantees and have no restrictions or covenants that would impact dividends or require incurring additional financial obligations.

The following tables present information about leases as of the dates and for the periods indicated:

September 30,

Lease liability

2 unchanged sentences

Weighted average discount rate

For the Three Months Ended September 30,

Lease Expense

Operating lease expense

Short-term lease expense

Total lease expense

Cash paid for amounts included in lease liabilities

Right-of-use assets obtained in exchange for operating lease liabilities commencing

during the period

For the Nine Months Ended September 30,

For the Three Months Ended March 31,

Lease Expense

Operating lease expense

Short-term lease expense

Total lease expense

Cash paid for amounts included in lease liabilities

Right-of-use assets obtained in exchange for operating lease

liabilities commencing during the period

The following table presents a maturity schedule of undiscounted cash flows that contribute to the lease liability:

Undiscounted Cash Flow for the Period

September 30, 2025

Twelve months ending September 30, 2026

Twelve months ending September 30, 2027

Twelve months ending September 30, 2028

Twelve months ending September 30, 2029

Twelve months ending September 30, 2030

March 31, 2026

Twelve months ending March 31, 2027

Twelve months ending March 31, 2028

Twelve months ending March 31, 2029

Twelve months ending March 31, 2030

Twelve months ending March 31, 2031

Total undiscounted cash flows

3 unchanged sentences

The maximum number of shares available for issuance under the Plan is 120,000 shares.

The restricted stock has voting rights and rights to dividends, which are paid upon vest date.

For further information on the Plan, please refer to the Company’s 2025 Form 10-K.

Restricted Stock Awards

Under the Plan, restricted stock awards (“RSAs”) were granted to non-employee directors as part of the semi-annual retainer and restricted stock units ("RSUs") were granted to certain executives.

The RSAs and RSUs were valued at the closing stock price on the grant date and expensed over a one-year vesting period.

Stock based compensation expense charged against income was $ 49 and $ 143 for the three and nine months ended September 30, 2025 and $ 28 and $ 93 for the three and nine months ended September 30, 2024.

As of September 30, 2025 , compensation expense of $ 105 related to the nonvested RSAs and RSUs is expected to be recognized over the coming 12 months.

A summary of changes in the Company’s nonvested RSAs under the Plan for the nine months ended September 30, 2025 follows:

Restricted Stock Awards and Restricted Stock Units

As of December 31, 2025, the Company had nonvested restricted stock awards ("RSAs"), granted to non-employee directors, and restricted stock units ("RSUs"), granted to employees designated in the incentive compensation plan.

Additional RSUs were granted in February 2026 that will vest in equal parts in 2027, 2028 and 2029.

The RSAs and RSUs were valued at the closing stock price on the grant date and the Company is recognizing expense over the associated vesting period.

Stock based compensation expense charged against income was $ 62 for the three months ended March 31, 2026 and $ 43 for the three months ended March 31, 2025.

As of March 31, 2026, the Company expects to recognize stock based compensation expense of $ 166 over the coming 12 months.

A summary of changes in the Company’s nonvested RSAs and RSUs under the Plan for the three months ended March 31, 2026 follows:

Weighted-Average

Nonvested at January 1, 2026

Vested and released

Nonvested at September 30, 2025

Nonvested at March 31, 2026

Net Income Per Common Share

The factors used in the computation of net income per common share for the periods indicated are presented below:

For the Three Months Ended September 30,

Common Shares Weighted Average Outstanding (1) (Denominator)

Basic net income per

Dilutive shares (1)

Diluted net income per

For the Nine Months Ended September 30,

Common Shares Weighted Average Outstanding (1) (Denominator)

For the Three Months Ended March 31,

Shares Weighted Average Outstanding

(Denominator)

Shares Weighted Average Outstanding

(Denominator)

Basic net income per

1 unchanged sentence

Diluted net income per

(1) Dilutive shares are associated with RSAs.

RSAs are disregarded in the computation of diluted net income per share if they are determined to be anti-dilutive.

There were no anti-dilutive RSAs for the three and nine months ended September 30, 2025 and September 30, 2024 .

RSA grants are disregarded in the computation of diluted net income per share if they are determined to be anti-dilutive.

There were no anti-dilutive RSAs for the three months ended March 31, 2026 and March 31, 2025 .

Note 11 – Goodwill and Other Intangibles

Core deposit intangible amortization expense was $ 92 and $ 284 for the three and nine months ended September 30, 2025.

Core deposit intangible amortization expense was $ 102 and $ 137 for the three and nine months ended September 30, 2024.

The following table provides information on the significant components of goodwill and other acquired intangible assets during the nine months ended September 30, 2025:

Core deposit intangible amortization expense was $ 87 and $ 97 for the three months ended March 31, 2026 and 2025, respectively.

The following table provides information on the significant components of goodwill and other acquired intangible assets at March 31, 2026.

Beginning Balance

Measurement Period Adjustment

Accumulated Amortization

1 unchanged sentence

Core deposit intangible

As of September 30, 2025, estimated future remaining amortization of the core deposit intangible within the years ending December 31, is as follows:

As of March 31, 2026, estimated future remaining amortization of the core deposit intangible within the years ending December 31, is as follows:

Amortization Expense

Total amortizing core deposit intangible

Note 13 - Borrowings

During the third quarter of 2025, the Company borrowed $ 40,000 from the Federal Home Loan Bank of Atlanta and $ 10,000 from the Federal Reserve Discount Window.

The borrowings were part of a yield optimization strategy and the proceeds were used to purchase securities.

The borrowings were structured to mirror expected cash flow from the securities portfolio through the end of 2026.

All borrowings mature within the next 12 months and have a weighted average interest rate of 3.99 % .

Note 12 - Subsequent Events

On May 1, 2026 the Company announced the sale of its membership interest in Bearing Insurance Group, LLC.

Based solely on information available to the Company, the Company estimates it will recognize a pre-tax gain of approximately $ 6,566 on the transaction, which will be reported in the Company's financial results for the second quarter of 2026.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements