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Rockingham Heritage Bank

Harrisonburg, VA · Cert 33195

FDIC

Q2 2007

$427.4MAssets
$345.7MLoans
$349.6MDeposits
$60.1MEquity
Loan mix
77%RE $226.1M22%C&I $66.5M1%Consumer $3.0MQ2 2006Q2 2007
Deposit mix
85%Interest-bearing $298.7M15%Noninterest $50.9MQ2 2006Q2 2007

NIM

5.71%Q2 ’056.52%Q2 ’066.92%Q2 ’07-1%+0%

Non-interest income vs. expense

2.34%Q2 ’052.49%Q2 ’062.60%Q2 ’07+6%+2%

Executive Summary

  • Earnings: ROA of 1.15%, down 4 bps year over year; NIM at 3.88%.
  • Asset quality: problem loans at 0.00% of loans (0 bps YoY), with net charge-offs at 0.02%.
  • Funding: loans stand at 98.90% of deposits as of Q2 2007.

Financial Results

Return on Assets (YTD, annualized)

1.15%-4 bps YoY

Net Interest Margin (YTD, annualized)

3.88%+1 bps YoY

Efficiency Ratio (YTD, annualized)

57.42%-68 bps YoY

Tier 1 Leverage Ratio

n/a

Year to date, annualized, through each quarter.

MetricQ2 2006Q3 2006Q4 2006Q1 2007Q2 2007YoY ΔTrend
Earnings
Return on Assets1.18%1.26%1.30%1.14%1.15%-4 bps
Return on Equity13.42%12.04%11.65%8.51%8.39%-502 bps
Net Interest Margin3.87%3.05%3.22%3.82%3.88%+1 bps
Efficiency Ratio58.10%57.60%56.19%56.96%57.42%-68 bps
Non-Interest Burden2.07%1.64%1.68%2.04%2.12%+4 bps
Growth
Asset Growth (YoY)18.26%65.14%63.54%59.80%51.94%+3,368 bps
Loan Growth (YoY)18.21%57.51%54.99%52.99%41.91%+2,371 bps
Deposit Growth (YoY)17.63%57.92%60.59%50.71%45.77%+2,813 bps
Asset Quality
Nonperforming Loans / Loans0.00%0.00%0.00%0.00%0.00%0 bps
Net Charge-Offs / Loans0.00%0.00%0.01%-0.02%0.02%+2 bps
Allowance / Loans0.75%0.82%0.84%0.85%0.87%+12 bps
Allowance Coverage of NPLsn/an/an/an/an/an/an/a
Capital
Tier 1 Leverage Ration/an/an/an/an/an/an/a
Total Risk-Based Capital11.18%12.15%12.10%12.16%13.12%+194 bps
Equity / Assets8.83%13.57%13.34%13.56%14.06%+523 bps
Liquidity & Funding
Loans / Deposits101.58%102.02%100.82%102.07%98.90%-268 bps
Liquid Assets / Assets2.13%1.82%0.74%0.72%0.67%-146 bps
CRE / Total Capitaln/an/an/an/an/an/an/a