Xenith Bankshares, Inc. Reports Loan, Deposit, And Total Asset Growth For The Third Quarter, And Nine Months Of 2013 Financial Results

RICHMOND, Va., Oct. 30, 2013 (GLOBE NEWSWIRE) -- Xenith Bankshares, Inc. (Nasdaq:XBKS), parent company of Xenith Bank, a business-focused bank serving the Greater Washington, D.C., Richmond, and Greater Hampton Roads, Virginia markets, today announced financial results for the three and nine months ended September 30, 2013.

Net income was $748,000, or $0.07 per common share, for the three months ended September 30, 2013, compared to net income of $5.9 million, or $0.56 per common share, for the three months ended September 30, 2012. For the nine months ended September 30, 2013, net income was $1.7 million, or $0.16 per common share, compared to $7.0 million, or $0.67 per common share for the nine months ended September 30, 2012. Net income in both periods of 2013 reflected income tax expense, while net income in the comparable 2012 periods included a $5.0 million, or $0.47 per common share, tax benefit due to the reversal of the valuation allowance on the company's net deferred tax asset.

T. Gaylon Layfield, III, President and Chief Executive Officer, commented: "Xenith's financial results demonstrate the continued progress we have made in building a diversified portfolio of loans and deposits, while maintaining strong credit quality and time-tested underwriting standards. We are supporting our lending activities primarily with low-cost core deposits, which is having a positive impact on our cost of funds. We have purposely built an asset-sensitive balance sheet, which we believe positions the bank well in a rising interest rate environment."

Third Quarter, Nine Months 2013 Highlights
  • Reflecting improvement in core operations, net income before income tax in the third quarters of 2013 and 2012 was $1.2 million and $1.0 million, respectively, while net income before income tax in the nine months of 2013 and 2012 was $2.6 million and $2.1 million, respectively.
  • Net loans held for investment were $432.3 million at September 30, 2013, up 14%, compared to $379.0 million at December 31, 2012.
  • Average interest-earning assets in third quarter 2013 were $554.2 million, up 8% from $513.1 million in third quarter 2012.
  • Total assets at September 30, 2013 were $606.3 million, an increase of 7.6%, compared to $563.2 million at December 31, 2012.
  • Asset quality and coverage for loan losses remained strong at September 30, 2013, with ratios of nonperforming assets to total assets of 0.73%, nonperforming assets to loans held for investment of 1.02%, and an allowance for loan and lease losses to nonaccrual loans of 127%. Net charge-offs as a percentage of average loans held for investment were 0.15% for the nine-month period ended September 30, 2013.
  • Capital strength was reflected in ratios that were well above regulatory standards for "well-capitalized" banks, with a Tier 1 leverage ratio of 12.0%, a Tier 1 risk-based capital ratio of 13.8%, and a total risk-based capital ratio of 14.9% at September 30, 2013.
  • Reflecting shareholder value growth, tangible book value1 at September 30, 2013 was $6.07 per common share, compared to $6.02 at December 31, 2012.

"Our primary approach to building value is to build a strong balance sheet that performs in a variety of economic and interest rate environments," Layfield explained. "We have invested in people, because long-term performance, sustainability, and growth require experienced revenue-generating loan officers, supported by a staff focused on outstanding execution. We believe that we have developed the technology and operational capability to drive growth while carefully monitoring credit quality and overall enterprise risk management. We focus closely on ensuring risk-adjusted loan pricing, because prudent growth is in our shareholders' best interest.

Xenith's loan portfolio at September 30, 2013 reflected balanced growth in C&I and CRE lending since year end 2012, consistent with our objective to maintain an appropriate loan mix. Our C&I portfolio covers a broad array of industries in our target markets, and our CRE portfolio is heavily weighted toward loans to strong, local developers and investors." Layfield noted that in the third quarter of 2013, the bank acquired a $21 million portfolio of student loans, which on average are nearly 98% U.S. government guaranteed, 20% risk-weighted, and re-price every 90 days. Layfield commented: "We believe these guaranteed student loans are an attractive asset class with acceptable risk-adjusted returns and in the intermediate term, provide us with an opportunity to further leverage our capital."

Operating Results

Income Statement

Total interest income for the three months ended September 30, 2013 was $6.9 million, compared to $6.8 million for the three months ended September 30, 2012. Interest income reflected stable interest and fees on loans, and increased interest from securities. Average interest-earning assets in third quarter 2013 were $554.2 million, up 8% from $513.1 million in third quarter 2012. Interest income for the nine months ended September 30, 2013, was $19.2 million, compared to $19.5 million for the same period of 2012. Interest income in the nine month comparative periods reflected lower accretion from acquired loans, further discussed below, and lower interest from securities.

Total interest expense for the three months ended September 30, 2013 was $832,000, compared to $985,000 for the three months ended September 30, 2012. For the nine months ended September 30, 2013, interest expense was $2.6 million, compared to $3.0 million for the same period of 2012. Lower interest expense on higher average deposit balances contributed to enhanced profitability.

Net interest income after provision for loan and lease losses was $5.6 million in the third quarter of 2013, compared to $5.4 million in the third quarter of 2012, as net interest income increased moderately and the provision for loan and lease losses remained relatively stable at $497,000 in the third quarter of 2013, compared to the prior year's third quarter provision of $476,000. For the nine-month period ended September 30, 2013, net interest income after loan and lease loss provision was $15.7 million, compared to $15.1 million for the same period of 2012, reflecting stable net interest income and a decline in the company's loan loss provision to $913,000, compared to $1.4 million in the same period of 2012. Net interest income after provision for loan losses in the third quarter and nine-month 2013 periods was affected by margin pressure and lower accretion on acquired loans, offset by lower provision expense due to solid asset quality. Net interest margin in the third quarter of 2013 was 4.38% compared to 4.54% in the third quarter of 2012, while net interest margin for the nine months ended September 30, 2013 was 4.04%, compared to 4.58% for the same nine-month period of 2012. Accretion of fair value adjustments on acquired loans was $1.1 million in both third quarter 2013 and 2012, and $2.1 million and $2.7 million, respectively, in the nine-month periods ended September 30, 2013 and 2012.

Total noninterest income was $345,000 in the third quarter of 2013, compared to a loss of $14,000 in the third quarter of 2012, primarily reflecting growth in service charges on deposit accounts, increased fees from treasury management services, and fees associated with customer interest rate swaps. For the nine months ended September 30, 2013, noninterest income increased to $1.4 million, compared to $596,000 for the same nine months of 2012, reflecting higher year-over-year income from service charges, fees, and other income. The nine month period of 2013 included a $361,000 gain on the sale of collateral on an impaired loan acquired in the 2011 Virginia Business Bank transaction.

Noninterest expense in the third quarter of 2013 was $4.8 million, compared to $4.4 million in the third quarter of 2012, and for the nine months ended September 30, 2013 was $14.4 million, compared to $13.6 million for the same prior year period. Layfield noted both the third quarter and nine-month 2013 periods reflect increased compensation and benefits, primarily related to the company's hiring of experienced relationship managers in the Greater Washington, D.C. and Richmond markets to drive organic loan and deposit growth.

As previously noted, the company had income tax expense in both the third quarter and nine-month periods of 2013. In both comparable periods of 2012, the company had no income tax expense and a $5.0 million tax benefit due to the reversal of the valuation allowance on the company's net deferred tax asset. For purposes of comparison, net income before income tax in the third quarters of 2013 and 2012 was $1.2 million and $1.0 million, respectively, while net income before income tax in the nine months ended September 30, 2013 and 2012 was $2.6 million and $2.1 million, respectively.

Balance Sheet

Loans held for investment after allowance for loan and lease losses grew to $432.3 million at September 30, 2013, compared to $379.0 million at December 31, 2012 and $393.6 million at June 30, 2013. Loan balances held for investment at September 30, 2013 include $21 million of guaranteed student loans purchased late in the third quarter. Loans held for sale, which primarily reflect the company's participation in a mortgage warehouse lending program, were $34.2 million at September 30, 2013, compared to $80.9 million at December 31, 2012. The decline reflected lower mortgage refinancing activity nationwide, which the company expects will continue to impact balances in the fourth quarter until balances are at an insignificant level. Layfield commented that additional investments in guaranteed student loans may be a prudent use of cash freed up from the mortgage warehouse program.

Securities available for sale were $72.4 million at September 30, 2013, compared to $57.6 million at December 31, 2012. Securities available for sale as a percentage of the company's total assets were 12% at September 30, 2013.

Layfield commented: "Given the uncertain interest rate environment and our desire to fund higher yielding loans with our excess liquidity, compared to lower yielding securities, we continued to maintain investments of shorter duration in our investment portfolio and a good balance of floating rate investments."

Total assets were $606.3 million at September 30, 2013, compared to $563.2 million at December 31, 2012, primarily reflecting loan growth, cash and due from banks, and higher levels of investment securities.

Growth in commercial banking relationships contributed to a 9% growth in total deposits, which were $495.8 million at September 30, 2013, compared to $453.2 million at December 31, 2012. Noninterest-bearing demand accounts and lower-interest money market accounts fueled the growth, providing additional core deposit funding to support the company's lending activities. Average deposit balances in the third quarter of 2013 were $485.5 million, compared to $434.6 million in the comparable 2012 period.

Asset and Credit Quality

Balance sheet and asset quality continued to improve. At September 30, 2013, ratios of nonperforming assets to total assets was 0.73%, nonperforming assets to loans held for investment was 1.02%, and the company's allowance for loan and lease losses to nonaccrual loans was 127%. Net charge-offs as a percentage of average loans held for investment were 0.15% for the nine-month period ended September 30, 2013.

Capital and Shareholder Value Measures

Capital ratios remained above regulatory standards for "well-capitalized" banks, with a Tier 1 leverage ratio of 12.0%, a Tier 1 risk-based capital ratio of 13.8%, and a total risk-based capital ratio of 14.9% at September 30, 2013.

As part of the company's share repurchase program announced in the third quarter of 2013, under which the company may repurchase up to 210,000 shares of its common stock, or approximately 2% of its currently outstanding shares, the company repurchased 16,850 shares at an average price of $5.92 per share during the third quarter for a total cost of $99,684.

Total shareholders' equity was $87.7 million at September 30, 2013, compared to $87.5 million at December 31, 2012. The increase during third quarter in longer term interest rates had a negative impact on the market value of the company's securities portfolio, which reduces shareholders' equity. Tangible book value 1 at September 30, 2013 was $6.07 per share, compared to $6.02 at December 31, 2012. Return on average assets was 0.50% at September 30, 2013 compared to 0.24% at December 31, 2012. Return on average common equity increased to 3.78% at September 30, 2013, compared to 1.68% at December 31, 2012.

Market Overview and Outlook

Layfield concluded: "We maintain a long-term perspective to building a premier business banking franchise in the diverse and attractive markets Xenith serves. We anticipate continued organic growth with an eye towards thoughtful and prudent acquisitions or other transactions where and when appropriate. The corporate culture we are building is an important consideration in acquisitive growth, as we look at potential merger or acquisition candidates and their respective shareholder bases as partners teaming with Xenith. We believe our future is bright and are cautiously optimistic as the economy continues to improve slowly."

Profile

Xenith Bankshares, Inc. is the holding company for Xenith Bank. Xenith Bank is a full-service, locally-managed commercial bank, specifically targeting the banking needs of middle market and small businesses, local real estate developers and investors, private banking clients, and select retail banking clients. As of September 30, 2013, the company had total assets of $606.3 million and total deposits of $495.8 million. Xenith Bank's target markets are Greater Washington, DC, Richmond, VA, and Greater Hampton Roads, VA metropolitan statistical areas. The company is headquartered in Richmond, Virginia and currently has six branch locations in Tysons Corner, Richmond, and Suffolk, Virginia. Xenith Bankshares common stock trades on the NASDAQ Capital Market under the symbol "XBKS."

For more information about Xenith Bankshares and Xenith Bank, visit our website: https://www.xenithbank.com/

All statements other than statements of historical facts contained in this press release are forward-looking statements. Forward-looking statements made in this press release reflect beliefs, assumptions and expectations of future events or results, taking into account the information currently available to Xenith Bankshares, Inc. These beliefs, assumptions and expectations may change as a result of many possible events, circumstances or factors, not all of which are currently known to Xenith Bankshares. If a change occurs, Xenith Bankshares' business, financial condition, liquidity, results of operations and prospects may vary materially from those expressed in, or implied by, the forward-looking statements. Accordingly, you should not place undue reliance on these forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by these forward-looking statements include the risks discussed in Xenith Bankshares' public filings with the Securities and Exchange Commission, including those outlined in Part I, Item 1A, "Risk Factors" of Xenith Bankshares' Annual Report on Form 10-K for the year ended December 31, 2012. Except as required by applicable law or regulations, Xenith Bankshares does not undertake, and specifically disclaims any obligation, to update or revise any forward-looking statement.

1 Please see the discussion of non-GAAP financial measures at the end of the financial tables.

-Selected Financial Tables Follow-
 
 
 
XENITH BANKSHARES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2013 AND DECEMBER 31, 2012
 
   (Unaudited)   
(in thousands, except share data) September 30, 2013 December 31, 2012
Assets    
Cash and cash equivalents    
Cash and due from banks  $ 23,604  $ 9,457
Federal funds sold  935  2,906
Total cash and cash equivalents  24,539  12,363
Securities available for sale, at fair value  72,449  57,551
Loans held for sale  34,247  80,867
Loans held for investment, net of allowance for loan and lease losses, 2013 - $5,129; 2012 - $4,875  432,269  379,006
Premises and equipment, net  5,117  5,397
Other real estate owned  400  276
Goodwill and other intangible assets, net  15,716  15,989
Accrued interest receivable  1,462  1,606
Deferred tax asset  4,354  4,094
Bank owned life insurance  9,606  --
Other assets  6,101  6,057
Total assets  $ 606,260  $ 563,206
Liabilities and Shareholders' Equity    
Deposits    
Demand and money market  $ 333,179  $ 317,526
Savings  4,561  4,069
Time  158,081  131,636
Total deposits  495,821  453,231
Accrued interest payable  227  232
Borrowings  20,000  20,000
Other liabilities  2,512  2,196
Total liabilities  518,560  475,659
Shareholders' equity    
Preferred stock, $1.00 par value, $1,000 liquidation value, 25,000,000 shares authorized as of September 30, 2013 and December 31, 2012; 8,381 shares issued and outstanding as of September 30, 2013 and December 31, 2012  8,381  8,381
Common stock, $1.00 par value, 100,000,000 shares authorized as of September 30, 2013 and December 31, 2012; 10,471,210 shares issued and outstanding as of September 30, 2013 and 10,488,060 shares issued and outstanding as of December 31, 2012  10,471  10,488
Additional paid-in capital  71,812  71,414
Accumulated deficit  (2,005)  (3,660)
Accumulated other comprehensive (loss) income, net of tax  (959)  924
Total shareholders' equity  87,700  87,547
Total liabilities and shareholders' equity  $ 606,260  $ 563,206
     
See notes to consolidated financial statements.    
 
 
 
 XENITH BANKSHARES, INC. AND SUBSIDIARY 
 CONSOLIDATED STATEMENTS OF OPERATIONS 
 FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2013 AND 2012 
 (Unaudited) 
     
(in thousands, except per share data)  September 30, 2013  September 30, 2012
Interest income    
Interest and fees on loans  $ 6,481 $ 6,431
Interest on securities  350  320
Interest on federal funds sold and deposits in other banks  63  62
Total interest income  6,894  6,813
Interest expense    
Interest on deposits  510  683
Interest on time certificates of $100,000 and over  226  209
Interest on federal funds purchased and borrowed funds  96  93
Total interest expense  832  985
Net interest income  6,062  5,828
Provision for loan and lease losses  497  476
Net interest income after provision for loan and lease losses  5,565  5,352
Noninterest income    
Service charges on deposit accounts  113  81
Net loss on sale and write-down of other real estate owned and other collateral  (4)  (148)
Gain on sales of securities  --  1
Increase in cash surrender value of bank owned life insurance  83  --
Other  153  52
Total noninterest income  345  (14)
Noninterest expense    
Compensation and benefits  2,800  2,581
Occupancy  378  355
FDIC insurance  96  58
Bank franchise taxes  188  160
Technology  400  385
Communications  65  68
Insurance  74  73
Professional fees  283  325
Other real estate owned  2  8
Amortization of intangible assets  91  91
Other  382  281
Total noninterest expense  4,759  4,385
Income before income tax  1,151  953
Income tax expense (benefit)  403  (4,950)
Net income  748  5,903
Preferred stock dividend  (21)  (21)
Net income available to common shareholders  $ 727  $ 5,882
Earnings per common share (basic and diluted):  $ 0.07  $ 0.56
     
See notes to consolidated financial statements.
 
 
 
 XENITH BANKSHARES, INC. AND SUBSIDIARY 
 CONSOLIDATED STATEMENTS OF OPERATIONS 
 FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2013 AND 2012 
 (Unaudited) 
     
(in thousands, except per share data)  September 30, 2013 September 30, 2012 
Interest income    
Interest and fees on loans  $ 18,099  $ 18,127
Interest on securities  870  1,151
Interest on federal funds sold and deposits in other banks  217  205
Total interest income  19,186  19,483
Interest expense    
Interest on deposits  1,625  2,019
Interest on time certificates of $100,000 and over  715  715
Interest on federal funds purchased and borrowed funds  282  279
Total interest expense  2,622  3,013
Net interest income  16,564  16,470
Provision for loan and lease losses  913  1,383
Net interest income after provision for loan and lease losses  15,651  15,087
Noninterest income    
Service charges on deposit accounts  312  213
Net gain (loss) on sale and write-down of other real estate owned and other collateral  342  (19)
Gain on sales of securities  291  220
Increase in cash surrender value of bank owned life insurance  106  --
Other  329  182
Total noninterest income  1,380  596
Noninterest expense    
Compensation and benefits  8,548  8,095
Occupancy  1,112  1,091
FDIC insurance  304  239
Bank franchise taxes  601  454
Technology  1,220  1,190
Communications  186  207
Insurance  222  221
Professional fees  792  834
Other real estate owned  4  10
Amortization of intangible assets  273  274
Other  1,126  971
Total noninterest expense  14,388  13,586
Income before income tax  2,643  2,097
Income tax expense (benefit)  925  (4,950)
Net income  1,718  7,047
Preferred stock dividend  (63)  (68)
Net income available to common shareholders  $ 1,655  $ 6,979
Earnings per common share (basic and diluted):  $ 0.16  $ 0.67
     
See notes to consolidated financial statements.
               
               
               
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)              
($ in thousands, except per share data)              
               
PERFORMANCE RATIOS Quarter Ended   Year Ended
  September 30, June 30, March 31, December 31, September 30,    
  2013 2013 2013 2012 2012   2012
Net interest margin (1)  4.38% 3.90% 3.83% 4.18% 4.54%   4.47%
Return on average assets (2) 0.50% 0.39% 0.29% 0.24% 4.38%   1.42%
Return on average common equity (3) 3.78% 2.77% 2.10% 1.68% 31.86%   9.89%
Efficiency ratio (4) 74% 85% 82% 80% 75%   80%
Net income  $ 748  552  418  332  5,903    7,379
Earnings per common share (basic and diluted)  $ 0.07  0.05  0.04  0.03  0.56    0.70
______________________________              
(1) Net interest margin is net interest income divided by average interest-earning assets.            
(2) Return on average assets is net income for the respective period (annualized for quarter periods) divided by average assets for the respective period.    
(3) Return on average equity is net income for the respective period (annualized for quarter periods) divided by average equity for the respective period.    
(4) Efficiency ratio is non-interest expenses divided by the sum of net interest income and non-interest income.        
               
ASSET QUALITY RATIOS Quarter Ended    
  September 30, June 30, March 31, December 31, September 30,    
  2013 2013 2013 2012 2012    
Net charge-offs as a percentage of average loans held for investment 0.15% 0.11% 0.04% 0.35% 0.28%    
Allowance for loan and lease losses (ALLL) as a percentage of total loans held for investment (1) 1.17% 1.23% 1.35% 1.27% 1.37%    
ALLL plus remaining discounts (fair value adjustments) on acquired loans as a percentage of total loans held for investment (2) 2.34% 2.96% 3.31% 3.32% 3.91%    
ALLL to nonaccrual loans (1) 126.59% 100.08% 104.35% 96.16% 95.94%    
Nonperforming assets as a percentage of total loans held for investment 1.02% 1.29% 1.37% 1.39% 1.52%    
Nonperforming assets as a percentage of total assets 0.73% 0.89% 0.89% 0.95% 0.93%    
______________________________              
(1) ALLL excludes discounts (fair value adjustments) on acquired loans.               
(2) Ratio is a non-GAAP financial measure calculated as the sum of ALLL and discounts (fair value adjustments) on acquired loans held for investment divided by the sum of total loans held for investment and discounts on loans. See discussion of non-GAAP financial measures below.      
               
CAPITAL RATIOS Quarter Ended    
  September 30, June 30, March 31, December 31, September 30,    
  2013 2013 2013 2012 2012    
Tier 1 leverage ratio 12.01% 12.39% 12.23% 12.90% 13.02%    
Tier 1 risk-based capital ratio 13.82% 13.69% 14.60% 15.39% 17.01%    
Total risk-based capital ratio 14.89% 14.71% 15.75% 16.52% 18.24%    
Book value per common share (1)  $ 7.58  7.51  7.57  7.55  7.54    
Tangible book value per common share (2)  $ 6.07  6.00  6.05  6.02  6.00    
______________________________              
(1) Book value per common share is total shareholders' equity less preferred stock divided by common shares outstanding at the end of the respective period.    
(2) Tangible book value per common share is a non-GAAP financial measure calculated as total shareholders' equity less the sum of preferred stock and goodwill and other intangible assets divided by common shares outstanding at the end of the respective period. See discussion of non-GAAP financial measures below.  
               
AVERAGE BALANCES (1) Quarter Ended   Year Ended
  September 30, June 30, March 31, December 31, September 30,    
  2013 2013 2013 2012 2012   2012
Total assets  $ 597,476  570,991  577,050  558,133  539,544    519,330
Loans held for sale  $ 50,179  62,396  66,434  72,676  75,396    49,579
Loans held for investment, net of allowance for loan and lease losses  $ 402,703  372,746  369,688  351,335  333,346    332,507
Total deposits  $ 485,511  460,288  466,018  447,829  434,640    413,808
Shareholders' equity  $ 87,598  88,153  87,907  87,623  82,485    83,010
______________________________              
(1) Average balances are computed on a daily basis.              
               
END OF PERIOD BALANCES Quarter Ended    
  September 30, June 30, March 31, December 31, September 30,    
  2013 2013 2013 2012 2012    
Total assets  $ 606,260  578,931  579,853  563,206  558,011    
Loans held for sale  $ 34,247  61,861  68,905  80,867  74,632    
Loans held for investment, net of allowance for loan and lease losses  $ 432,269  393,591  372,052  379,006  336,495    
Total deposits  $ 495,821  464,676  468,798  453,231  448,144    
Shareholders' equity  $ 87,700  87,138  87,772  87,547  87,172    
               
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES               
  Quarter Ended    
  September 30, June 30, March 31, December 31, September 30,    
ALLL + Discount / Gross Loans 2013 2013 2013 2012 2012    
Allowance for loan and lease losses  $ 5,129  4,882  5,099  4,875  4,658    
Add: Discounts (fair value adjustments) on acquired loans  $ 5,237  7,134  7,631  8,133  9,040    
Total ALLL + discounts on acquired loans  10,366  12,016  12,730  13,008  13,698    
Gross loans held for investment + discounts (fair value adjustments) on acquired loans  442,635  405,607  384,782  392,014  350,193    
ALLL plus discounts (fair value adjustments) on acquired loans as a percentage of total loans held for investment 2.34% 2.96% 3.31% 3.32% 3.91%    
               
               
Tangible book value per common share              
Total shareholders' equity  87,700  87,138  87,772  87,547  87,172    
Deduct: Preferred stock  8,381  8,381  8,381  8,381  8,381    
Common shareholders' equity  79,319  78,757  79,391  79,166  78,791    
Deduct: Goodwill and other intangible assets  $ 15,716  15,807  15,898  15,989  16,080    
Tangible common shareholders' equity  63,603  62,950  63,493  63,177  62,711    
Common shares outstanding  10,471  10,488  10,488  10,488  10,447    
Tangible book value per common share  $ 6.07  6.00  6.05  6.02  6.00    
______________________________              
Allowance for loan and lease losses (ALLL) plus discounts on acquired loans as a percentage of total loans held for investment and tangible book value per share are supplemental financial measures that are not required by, or presented in accordance with, U.S. GAAP. Management believes that ALLL plus discounts on acquired loans held for investment is meaningful because it is one of the measures we use to assess our asset quality. Management believes that tangible book value per common share is meaningful because it is one of the measures we use to assess capital adequacy. Set forth above are reconciliations of each of these non-GAAP financial measures calculated and reported in accordance with GAAP. Book value is the same as shareholders' equity presented on our consolidated balance sheets. Our calculations of these non-GAAP financial measures may not be comparable to the calculation of similarly titled measures reported by other companies.    
CONTACT: Thomas W. Osgood         Executive Vice President, Chief Financial Officer,         Chief Administrative Officer and Treasurer         (804) 433-2209         tosgood@xenithbank.com

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Walmart CEO: 'We Are Transforming Globally' With Flipkart

Three-Part FREE Webinar Series

Three-Part FREE Webinar Series

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March 24 Full-Day Course Offering: Professional Approach to Trading SPX

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Meet the Real Money Pros: Market Strategies for 2012