Virginia National Bankshares Corporation (VABK): Business Model Canvas [Dec-2025 Updated]

You're trying to get a clear picture of how Virginia National Bankshares Corporation actually runs its business, and honestly, mapping it out on the Business Model Canvas is the best way to see the engine under the hood. After two decades analyzing financial firms, I see a classic regional bank model here: they are deeply rooted in local commercial lending and wealth management, using community ties as their primary Key Resource to gather deposits. As of Q3 2025, with total assets at $1.61 billion and a respectable 1.12% Return on Average Assets, the question becomes: how sustainable is this community-first approach against the pressure to lower their 57.9% efficiency ratio? Look below at the full breakdown to see precisely how their Key Activities translate into Net Interest Income and what their biggest cost drivers are right now.

Virginia National Bankshares Corporation (VABK) - Canvas Business Model: Key Partnerships

You're looking at the relationships Virginia National Bankshares Corporation (VABK) relies on to keep the engine running, especially for things like liquidity and deposit insurance beyond their own branch network. These aren't just friendly chats; these are critical, often contractual, financial dependencies.

Third-party provider for Insured Cash Sweep (ICS) plans

VABK partners with a third-party to offer reciprocal Insured Cash Sweep (ICS) plans, which helps them provide FDIC insurance coverage for customer balances exceeding single-bank limits. This is a key tool for managing large corporate or institutional deposits.

• Deposit balances held in ICS plans as of September 30, 2025, totaled $145.2 million.
• Balances held in ICS plans as of December 31, 2024, were $166.6 million.
• Balances held in ICS plans as of September 30, 2024, were $145.6 million.

Federal Home Loan Bank (FHLB) for liquidity and borrowings

The Federal Home Loan Bank (FHLB) serves as a vital source of contingent liquidity and wholesale funding. The level of borrowing here shows how VABK manages its balance sheet funding mix.

Metric	Amount as of September 30, 2025	Comparison Point
Outstanding FHLB Borrowings	$30.0 million (Calculated: $52.5M on 9/30/2024 minus $22.5M decrease)	Decreased $22.5 million from September 30, 2024 ($52.5 million)
Outstanding FHLB Borrowings	$30.0 million (Calculated: $10.0M increase from December 31, 2024)	Increased $10.0 million from December 31, 2024
Unused Borrowing Facilities	Approximately $223.0 million	As of September 30, 2025

The Bank actively manages this facility; for instance, borrowings were $61.0 million as of June 30, 2025, up $41.0 million from year-end 2024. This shows dynamic use of the FHLB line.

Local business leaders and community members (founding support)

While the initial support from local leaders is historical, its impact is seen in the current scale of the organization. The outgoing Chief Financial Officer noted that during her tenure, which included navigating crises, the bank grew its assets from $800 million to $1.6 billion. This growth reflects the sustained community and business support that underpins the bank's footprint.

Technology vendors for core banking and digital services

VABK relies on technology vendors for its core banking platform and the robust online and mobile platforms it offers customers. Strong operational efficiency suggests effective technology partnerships.

• Efficiency Ratio (FTE) improved to 57.9% for the three months ended September 30, 2025.
• The Efficiency Ratio was 61.2% for the three months ended September 30, 2024.
• Year-to-date Efficiency Ratio improved to 60.5% in 2025 compared to 62.6% in 2024.

Correspondent banks for specialized services

Specialized services, like fiduciary and wealth management functions, often rely on correspondent relationships for processing, custody, or specialized legal/regulatory support, though specific partner names aren't public.

VABK offers fiduciary services through its VNB Trust and Estate Services segment. The bank also operates Sturman Wealth Advisors and Masonry Capital, which manage assets and private investment funds, likely requiring external specialized service providers.

Virginia National Bankshares Corporation (VABK) - Canvas Business Model: Key Activities

You're looking at how Virginia National Bankshares Corporation actually makes money and runs its shop as of late 2025. The core engine here is interest income, but the efficiency of that engine is what really matters for profitability.

Generating Net Interest Income (NII) via lending and deposits

The primary activity is managing the balance sheet to maximize the spread between what Virginia National Bankshares Corporation earns on its assets and what it pays on its liabilities. For the three months ended September 30, 2025, net interest income (FTE) was a key driver, coming in at $13.1 million, which was an increase of 8.7% compared to the same period in 2024. This improvement was largely due to lower interest expense on deposits, even as the yield on loans held steady at 5.64% for the quarter.

Commercial, real estate, and consumer loan origination

Virginia National Bankshares Corporation actively engages in originating loans across several categories to deploy capital. The portfolio is diversified, focusing on commercial and industrial (C&I) loans, owner-occupied commercial real estate (CRE), investment CRE, and consumer installment loans. While the focus remains on strong credit standards, the company experienced nominal loan contraction in the third quarter of 2025, with gross loan balances decreasing by $1.0 million from year-end 2024, settling at $1.2 billion as of September 30, 2025. This suggests a focus on quality over sheer volume in the current rate environment.

Here's a quick look at some key balance sheet metrics as of September 30, 2025, compared to the prior year-end:

Metric	Value as of 9/30/2025	Change from 12/31/2024
Gross Loans Outstanding	$1.2 billion	Decreased $1.0 million
Loan-to-Deposit Ratio	89%	Remained stable (vs. Q2 2025)
Quarterly Net Income	$4.6 million	Consistent with Q3 2024

Managing wealth, trust, and fiduciary services through VNB Trust

A supporting activity involves managing wealth, trust, and fiduciary services through VNB Trust and Estate Services. This division provides investment management, trust administration, and custody services to individuals, businesses, and charitable organizations. Revenue generation here is tied to performance and assets under management (AUM), derived from royalty/revenue sharing on fixed and incentive fees, advisory/brokerage revenue, and management/trust service fees. The team works to ensure estate plans are executed and assets are managed with unbiased loyalty.

Optimizing the efficiency ratio, which hit 57.9% in Q3 2025

Operational excellence is a constant activity, measured closely by the efficiency ratio (FTE). Virginia National Bankshares Corporation successfully drove this metric down to 57.9% for the three months ended September 30, 2025. That's a solid improvement from 61.2% in the second quarter of 2025, showing management is effectively controlling noninterest expenses relative to revenue growth. This focus on operating leverage is defintely key to boosting returns.

Deposit gathering to stabilize and reduce the cost of funds

A critical, ongoing activity is attracting and managing deposits to fund loan growth and manage funding costs. The strategy in late 2025 involved actively managing the mix of cost components. Deposit balances decreased by $38.7 million since December 31, 2024, which management noted facilitated efforts to stabilize the overall cost of funds. This focus paid off, as the overall cost of funds declined 30 basis points (bps) year-over-year, dropping to 177 bps in Q3 2025 from 207 bps in Q3 2024. Specifically, the cost of interest-bearing deposits fell by 45 bps to 2.26%.

Key components of the funding strategy include:

• Focusing on stabilizing the overall cost of funds.
• Reducing higher cost borrowings, like FHLB advances.
• Utilizing reciprocal Insured Cash Sweep (ICS) plans.
• Maintaining a low cost of funds compared to peers.

Outstanding borrowings from the FHLB also decreased by $22.5 million from September 30, 2024, to $52.5 million as of September 30, 2025.

Virginia National Bankshares Corporation (VABK) - Canvas Business Model: Key Resources

You're looking at the foundational assets Virginia National Bankshares Corporation relies on to execute its business plan, which is heavily weighted toward local relationship banking and wealth services across Virginia. These aren't just line items; they are the engine room.

Financial Capital and Balance Sheet Strength

The financial foundation is anchored by the size of the balance sheet and the liquidity position. As of the third quarter of 2025, the firm reported $1.61 billion in Total Assets. This scale is significant, representing growth from $800 million during the tenure of the departing CFO, as noted by CEO Glenn W. Rust.

Here is a snapshot of key financial metrics as of September 30, 2025, where available:

Metric	Amount / Ratio	Date / Period
Total Assets	$1.61 billion	Q3 2025 (as provided)
Gross Loans Outstanding	$1.2 billion	September 30, 2025
Nonperforming Assets (% of Total Assets)	0.42%	September 30, 2025
Unused Borrowing Facilities	$223.0 million	September 30, 2025
Deposit Balances Change (YoY)	+ $5.0 million (or 0.4%)	vs. September 30, 2024

The firm maintains significant contingent liquidity, reporting unused borrowing facilities in place of approximately $223.0 million as of September 30, 2025. Also, the company held no brokered deposits on that date.

Management and Expertise

The human capital is centered on deep local banking experience. The leadership team has navigated significant events, including a merger, several industry sector crises, and the COVID-19 pandemic, while overseeing the asset growth mentioned above. A key recent development involves executive transition; Cathy W. Liles became Chief Financial Officer effective November 21, 2025, with former CFO Tara Y. Harrison moving to Senior Advisor indefinitely to ensure an orderly handover. This transition is supported by prior association, as both Ms. Liles and Ms. Harrison have served together on the CFO Committee of the Virginia Bankers Association for many years.

Core Deposit Base and Funding Structure

The stability of Virginia National Bankshares Corporation hinges on its core deposit base across its Virginia markets. This low-cost funding is crucial for keeping the cost of funds managed, especially as the company works to stabilize its overall cost components. The loan-to-deposit ratio stood at 89% in Q3 2025, indicating a balanced funding and lending profile.

Key deposit metrics include:

• Deposit balances decreased $38.7 million since December 31, 2024, as of September 30, 2025.
• Deposit balances increased $5.0 million from September 30, 2024, to September 30, 2025.
• Balances held in Insured Cash Sweep (ICS) plans totaled $145.2 million as of September 30, 2025.
• Outstanding borrowings from the FHLB decreased $22.5 million from September 30, 2024, to $30.0 million as of September 30, 2025 (calculated from $52.5 million less $22.5 million).

Distinct Operating Segments

Virginia National Bankshares Corporation structures its operations across four distinct segments, which allows for specialized focus on different revenue streams, particularly diversifying beyond traditional lending:

• Bank: Core commercial and retail banking, including loan making and deposit taking.
• VNB Trust and Estate Services: Fiduciary services like corporate trustee and trust/estate administration.
• Sturman Wealth Advisors: Wealth and investment advisory services.
• Masonry Capital: Investment management for separately managed accounts and a private investment fund.

The non-bank segments provide a stable, recurring fee stream less sensitive to interest rate swings.

Finance: draft 13-week cash view by Friday.

Virginia National Bankshares Corporation (VABK) - Canvas Business Model: Value Propositions

You're looking at the core value delivered by Virginia National Bankshares Corporation (VABK) to its clients, which centers on a blend of personalized, local service and robust financial performance. This isn't just about transactions; it's about providing tailored financial solutions across a defined regional footprint.

Full-Service Commercial and Retail Banking in a Regional Footprint

Virginia National Bankshares Corporation, through its subsidiary Virginia National Bank, offers the full spectrum of banking services. This includes commercial lending, retail deposit accounts, and specialized services like Zelle and Apple Pay integration. The commitment is to the local community, which translates into a value proposition of accessibility and familiarity.

• Full range of services: Checking accounts, NOW accounts, Money Market Deposit Accounts, Time Deposits, and Personal IRAs.
• The organization is the bank holding company for Virginia National Bank, headquartered in Charlottesville, Virginia.
• The Bank received its federal banking charter from the Office of the Comptroller of the Currency on July 29, 1998.

Integrated Wealth Management and Fiduciary Services (VNB Trust)

A key differentiator is the integrated wealth management offering through VNB Trust and Estate Services, a division of VNB. This provides clients with community-based trust, investment, and administration services, working alongside their existing legal and tax professionals. It's important to note the distinction in insurance coverage here; while the Bank's deposits are FDIC insured, Investment Accounts at VNB Trust and Estate Services are explicitly stated as NOT insured or guaranteed by the FDIC or any other federal government agency, and may lose value.

VNB Trust and Estate Services can serve as executor, co-executor, or agent for an executor, offering unbiased loyalty and knowledgeable management of trust assets. The current VNB Trust and Estates Fee Schedule was approved effective April 23, 2025.

Community Bank Focus with Local Decision-Making and Service

The value proposition emphasizes that people, not just brick and mortar, make the bank successful. This local focus supports quicker, more informed decision-making for commercial and retail clients within their operating areas, which include locations in Charlottesville and Warrenton, Virginia.

Strong Profitability Metrics

The operational efficiency and profitability of Virginia National Bankshares Corporation translate directly into stability and confidence for clients and shareholders. For the quarter ended September 30, 2025, the company demonstrated solid performance, with key metrics improving over the previous quarter.

Metric (Q3 2025)	Value	Comparison
Return on Average Assets (ROAA)	1.12%	Improved from 1.05% (Q2 2025)
Return on Average Equity (ROE)	10.48%	Improved from 10.05% (Q2 2025)
Net Interest Margin (FTE)	3.43%	Improved from 3.40% (Q2 2025)
Efficiency Ratio (FTE)	57.9%	Improved from 61.2% (Q2 2025)
Loan-to-Deposit Ratio	89%	Remained stable

The quarterly net income for Q3 2025 was $4.6 million, resulting in diluted earnings per share of $0.84. Net interest income (FTE) for the quarter was $13.072 million (or $13.1 million). Total Liabilities & Shareholders' Equity as of September 30, 2025, stood at $1,622,141 thousand, or approximately $1.622 billion.

Multi-Million-Dollar FDIC Insurance via Insured Cash Sweep (ICS)

For clients with significant cash balances exceeding the standard single-bank FDIC limit of $250,000, Virginia National Bankshares Corporation offers a solution through a third-party Insured Cash Sweep (ICS) plan. This service automates the movement of excess balances into deposit accounts at multiple FDIC-insured banks, providing access to multi-million-dollar FDIC insurance coverage while keeping funds accessible through a single relationship. This addresses the need for high-limit security without sacrificing liquidity.

The company declared a quarterly cash dividend of $0.36 per share on October 22, 2025, representing an annual yield of approximately 3.63% based on the closing price on October 22, 2025.

Virginia National Bankshares Corporation (VABK) - Canvas Business Model: Customer Relationships

Virginia National Bankshares Corporation (VABK) maintains customer relationships rooted in its community bank structure, balancing personal interaction with necessary digital capabilities.

Personal, relationship-driven service model for commercial clients

The service model emphasizes direct, personal interaction for commercial clients, a hallmark of community banking. The total assets managed by Virginia National Bankshares Corporation stood at $0.32 Billion as of September 30, 2025. The company reported a quarterly net income of $0.92 Million for the third quarter of 2025. Gross loans outstanding reached $1.2 billion as of March 31, 2025. This scale supports a relationship-focused approach where commercial bankers know their clients' operations.

Dedicated advisors for wealth management and trust clients

Virginia National Bank offers the fiduciary services of VNB Trust and Estate Services. This specialized service implies dedicated advisory relationships for clients needing trust and estate planning. While specific Assets under Management for VNB Trust are not public, the broader US wealth management market's Financial Advisory segment was expected to see a 4.5% change in assets under management in 2025.

High-touch, community-focused approach in local branches

The high-touch service is physically supported by a network of banking offices. Virginia National Bank has seven banking offices throughout Fauquier and Prince William counties, three banking offices in Charlottesville and Albemarle County, and offices in Winchester and Richmond, Virginia, totaling at least 12 locations. The company employed 146 total employees as of September 30, 2025. This structure supports a community-focused approach, contrasting with the industry trend where 66% of consumers are unlikely to change their primary bank due to satisfaction with products and services.

Automated digital self-service for routine transactions

To support routine needs, Virginia National Bank provides online and mobile banking services for both personal and business customers. This digital component complements the in-person service. Industry-wide, 34% of consumers use a mobile banking app daily as of 2025. Deposit balances held in third-party Insured Cash Sweep (ICS) plans, which facilitate digital management of large deposits, amounted to $177.6 million as of March 31, 2025.

Long-term relationships with local shareholders and founders

The relationship extends to the ownership base, reflecting local investment. The stock symbol is VABK, and as of November 21, 2025, the share price was $39.14. The company declared a quarterly cash dividend of $0.36 per share, representing an annualized dividend of $1.44. The market capitalization was reported at $219.97 million. Institutional owners filed forms indicating holdings of 3,088,832 shares.

The following table summarizes key financial metrics as of mid-to-late 2025, reflecting the scale of the business supporting these customer relationships.

Metric	Value	As of Date/Period
Total Assets	$0.32 Billion	9/30/2025
Gross Loans Outstanding	$1.2 billion	3/31/2025
Net Interest Margin (FTE)	3.28%	Q1 2025
Quarterly Cash Dividend	$0.36 per share	Paid November 28, 2025
Market Capitalization	$219.97 million	Late 2025
Total Employees	146	9/30/2025

The bank emphasizes its local presence through its branch structure:

• Seven banking offices in Fauquier and Prince William counties.
• Three banking offices in Charlottesville and Albemarle County.
• Additional offices in Winchester and Richmond, Virginia.

For wealth management clients, the advisory approach is supported by services including:

• Financial Planning.
• Investment Asset Allocation.
• Estate Planning and Wealth Transfer Planning.

Finance: review the Q4 2025 client retention rate for commercial accounts by Tuesday.

Virginia National Bankshares Corporation (VABK) - Canvas Business Model: Channels

You're mapping out how Virginia National Bankshares Corporation (VABK) gets its services to customers, and honestly, for a regional player, their approach is a solid mix of local presence and digital reach. Here's the breakdown of their delivery mechanisms as of late 2025.

Network of physical banking offices across Virginia

Virginia National Bankshares Corporation operates its physical channel through its wholly-owned subsidiary, Virginia National Bank. The footprint is concentrated in key Virginia markets, providing face-to-face service where they focus their lending and deposit gathering efforts.

Geographic Area/Office Type	Count as of Late 2025
Total Banking Offices	12
Offices in Charlottesville and Albemarle County	4 (including one limited-service banking facility)
Offices in Fauquier and Prince William counties	7
Office in Richmond, Virginia	1
Office in Winchester, Virginia	1

Digital banking platform (online and mobile)

The bank supports its physical network with digital access points, allowing customers to manage their accounts remotely. This is crucial for maintaining service levels across their geographic footprint. You can access these services online at www.vnb.com.

• Online platform for account management.
• Mobile platform for on-the-go banking.
• Remote check deposit capability.

Dedicated wealth and trust offices (Sturman, VNB Trust)

Specialized fiduciary and wealth services are delivered through distinct business lines, which often operate with dedicated teams or offices separate from the core commercial bank branches. These channels focus on fee-based revenue streams, though wealth management fees saw a decrease in Q2 2025.

• VNB Trust and Estate Services: Offers fiduciary services, trust and estate administration, and IRA administration.
• Sturman Wealth Advisors: Provides wealth management and investment advisory services.
• Masonry Capital segment: Offers investment management services for separately managed accounts and a private investment fund.

Direct sales force for commercial and private banking

The Commercial Bank segment relies on direct interaction to originate loans and secure deposits from businesses and individuals. This sales effort encompasses a range of products designed for their regional customer base.

The services pushed through this channel include:

• Commercial loans.
• Residential and commercial real estate mortgages.
• Construction financing.
• Treasury management and merchant services for businesses.

ATMs and debit/credit card networks

While specific figures on ATM locations or network volume aren't public in the latest reports, access to cash and payment processing is standard through participation in major card networks. The bank offers debit and credit card services as part of its consumer offerings.

Finance: draft 13-week cash view by Friday.

Virginia National Bankshares Corporation (VABK) - Canvas Business Model: Customer Segments

Virginia National Bankshares Corporation serves distinct customer groups through its wholly-owned subsidiary, Virginia National Bank, and specialized segments like VNB Trust and Estate Services, Sturman Wealth Advisors, and Masonry Capital.

Individuals seeking retail banking and deposit products

This segment relies on traditional and digital banking services for their day-to-day financial needs across Virginia National Bank's offices, particularly in Northern Virginia, Fairfax, Loudoun, and Prince William counties.

• Offerings include checking accounts, savings accounts, money market accounts, and Certificates of Deposit (CDs).
• Digital banking solutions allow customers to manage accounts, transfer funds, pay bills, and deposit checks remotely.
• The company declared a quarterly cash dividend of $0.36 per share for the third quarter of 2025.

Small to mid-sized businesses needing commercial loans and cash management

Virginia National Bank focuses on making loans and taking deposits from businesses, supporting them with treasury management and merchant services to optimize cash flow.

Metric	Amount as of Q3 2025
Gross Loans Outstanding	$1.2 billion
Loan-to-Deposit Ratio	89%
Deposit Balance Change (vs. Dec 31, 2024)	Decreased $38.7 million

High-net-worth individuals for wealth and fiduciary services

Wealth and fiduciary services are delivered through VNB Trust and Estate Services, Sturman Wealth Advisors, and Masonry Capital, catering to more complex financial planning needs.

• Services include fiduciary account administration, investment advisory solutions, and retirement planning.
• Masonry wealth management fees were a component of noninterest income in prior periods.

Charitable organizations and non-profits

Charitable organizations are served by the Bank's commercial banking activities, which involve taking deposits and offering related services.

The Bank offers a full range of banking and related financial services to meet the needs of charitable organizations.

Real estate developers and investors (as a loan focus)

The lending portfolio includes commercial real estate mortgages and construction financing, directly serving developers and investors in the regional footprint.

Gross loans outstanding as of September 30, 2025, totaled $1.2 billion, which reflects the overall lending activity across all categories, including real estate.

Virginia National Bankshares Corporation (VABK) - Canvas Business Model: Cost Structure

You're looking at the cost side of the ledger for Virginia National Bankshares Corporation as of late 2025. For a bank, managing the cost of funds and operating expenses is where the real margin work happens, so let's break down the numbers from the third quarter of 2025.

Interest Expense on Deposits and Borrowings, a Key Focus for Reduction

Virginia National Bankshares Corporation has been actively managing its cost of funds, which directly impacts interest expense. For the three months ended September 30, 2025, the overall cost of funds, including noninterest-bearing deposits, was 177 bps, a decrease of 30 bps from the 207 bps reported in the same period of the prior year. This focus on reduction helped drive net interest income for the third quarter of 2025 up by $1.0 million, or 8.7%, compared to the third quarter of 2024, primarily due to this decreased interest expense. Specifically, the cost of interest-bearing deposits fell significantly, moving from a cost of 2.71% in Q3 2024 to 2.26% in Q3 2025. The cost of borrowings from the FHLB also saw a slight dip, decreasing 9 bps year-over-year, from 4.86% to 4.77%.

Non-interest Operating Expenses (Salaries, Occupancy, Technology)

Noninterest expense for the three months ended September 30, 2025, saw an increase of $461 thousand, or 5.8%, when compared to the same period in 2024. This rise reflects ongoing operational costs and investments. The efficiency ratio (FTE) improved to 57.9% for the third quarter of 2025, down from 61.2% in the second quarter of 2025, showing better operational leverage overall. Noninterest income, however, decreased by $101 thousand, or 7.0%, year-over-year for the quarter.

Here's a look at the expense movement:

Metric	Q3 2025 Amount/Ratio	Q3 2024 Amount/Ratio	Year-over-Year Change (Q3 2025 vs Q3 2024)
Noninterest Expense Change	N/A	N/A	Increase of $461 thousand (5.8%)
Efficiency Ratio (FTE)	57.9%	N/A (Q3 2024 was 58.6% for year-to-date comparison)	Improvement
Non-accruing Loans to Gross Loans	0.21%	0.21%	Stable
Net Charge-offs (Recoveries) to Average Loans	0.03%	0.02%	Increase

Provision for Credit Losses

Credit quality metrics remain a key area of focus. Nonperforming assets were reported at $6.8 million in Q3 2025. The ratio of non-accruing loans to gross loans stood at 0.21% for the third quarter of 2025, which was the same as the third quarter of 2024. Net charge-offs (recoveries) to average loans was 0.03% for the quarter. Furthermore, the company recorded a $78 thousand charge related to changes in unfunded reserves during the quarter.

Amortization of Core Deposit Intangible Asset

While a specific dollar amount for Virginia National Bankshares Corporation's amortization of the core deposit intangible asset for Q3 2025 isn't explicitly detailed in the available summaries, industry practice suggests a consistent approach. Based on analyzed acquisition data, a majority of banks selected a ten-year amortization term for these values. Regarding the method, an accelerated amortization method, such as the sum-of-the-years digits method, was selected in approximately two-thirds of recent transactions where data was available.

Regulatory Compliance and Technology Costs

These specific costs are embedded within the overall noninterest expense, but the drivers for the recent increase are clear. The higher noninterest expense in Q3 2025 was explicitly attributed to several factors, including:

• Increased franchise taxes.
• Higher FDIC insurance expense.
• Increased professional fees.
• Continued investments in information technology.

These are the direct cost inputs reflecting the current regulatory and operational environment for Virginia National Bankshares Corporation.

Virginia National Bankshares Corporation (VABK) - Canvas Business Model: Revenue Streams

You're looking at how Virginia National Bankshares Corporation (VABK) actually brings in the money, which for a bank like this, boils down to the spread between what it earns on assets and what it pays on liabilities, plus fees for services. It's all about managing that interest rate risk and driving fee-based income.

Net Interest Income (NII) from loans and securities forms the bedrock of Virginia National Bankshares Corporation's revenue. This is the core banking activity. For the three months ended September 30, 2025, the Net Interest Income (NII) was reported at $13.1 million. This was supported by a gross loan balance of $1.2 billion as of September 30, 2025. The management has been actively working to improve the profitability of this core function; the Net Interest Margin (FTE, a non-GAAP measure) for the third quarter of 2025 improved to 3.43%, up from 3.24% in the third quarter of 2024. Honestly, the key driver here was managing the cost side, as the overall cost of funds declined by 30 bps year-over-year, even while the yield on loans settled at 5.64% for the quarter. The loan portfolio generates this income through various products:

• Commercial loans
• Business lines of credit
• Residential and commercial real estate mortgages
• Construction financing
• Consumer installment loans

The overall financial performance reflects this focus. For the first nine months of 2025, Virginia National Bankshares Corporation recognized net income of $13.3 million. This is a solid number, showing improvement over the prior year's nine-month net income of $12.4 million, primarily due to that decreased interest expense.

We can map out the key financial results and operational metrics that feed into the revenue picture here:

Metric	Value (Q3 2025 or 9M 2025)	Context/Period
Net Income	$13.3 million	Nine months ended September 30, 2025
Revenue (TTM)	$56.6 million	Trailing twelve months to Q3 2025
Net Interest Income	$13.1 million	Three months ended September 30, 2025
Net Interest Margin (FTE)	3.43%	Three months ended September 30, 2025
Loan Yield	5.64%	Three months ended September 30, 2025

Non-interest income from wealth management and fiduciary fees provides diversification away from pure lending margins. Virginia National Bankshares Corporation structures this through specialized services. This revenue stream saw a decrease in the third quarter of 2025 compared to the prior year's third quarter, but it remains a crucial part of the overall revenue mix. The services supporting this include:

• VNB Trust and Estate Services
• Sturman Wealth Advisors

Fees from deposit accounts and transaction services capture revenue from the operational side of banking relationships. These fees come from the day-to-day interactions customers have with the bank, which helps keep the efficiency ratio in check; the efficiency ratio (FTE) improved to 57.9% for the three months ended September 30, 2025. The services generating these fees include:

• Treasury management for businesses
• Merchant services for payment processing
• Fees associated with deposit accounts

To be defintely clear on the top line, the Revenue for the trailing twelve months (TTM) to Q3 2025 was reported at $56.6 million. That's the total top-line figure you need to anchor your valuation models against.