NEW PEOPLES BANKSHARES Posts Strong 29% Net Income Growth

TL;DR

**NWPP is a buy; strong loan growth and capital position signal continued upside.**

AI Summary

NEW PEOPLES BANKSHARES INC reported a strong financial performance for the nine months ended September 30, 2025, with net income increasing by 29.05% to $7.198 million from $5.578 million in the prior year. Total interest and dividend income rose to $35.918 million, up from $33.172 million, primarily driven by a significant increase in loan income to $31.669 million from $28.316 million. Despite a slight increase in the provision for credit losses to $602,000 from $478,000, net interest income after provision for credit losses grew by 15.80% to $23.859 million. The company's total assets expanded to $910.724 million as of September 30, 2025, from $854.925 million at December 31, 2024, an increase of 6.52%. Shareholder equity also saw a healthy rise of 12.42% to $79.528 million from $70.741 million, bolstered by retained earnings growth and a reduction in accumulated other comprehensive loss. The bank maintains a 'well capitalized' status with a Total capital to risk weighted assets ratio of 16.05% as of September 30, 2025, exceeding the 10.00% minimum for well-capitalized institutions.

Why It Matters

This robust performance by NEW PEOPLES BANKSHARES INC signals strong operational health and effective management in a competitive banking landscape. For investors, the significant increase in net income and shareholder equity, coupled with a 'well capitalized' status, suggests financial stability and potential for future returns. Employees benefit from a growing, stable institution, while customers can be confident in the bank's ability to provide reliable services. In the broader market, NWPP's growth in loans and deposits indicates continued economic activity in its service regions of southwest Virginia, southern West Virginia, western North Carolina, and northeastern Tennessee, potentially outperforming regional peers.

Risk Assessment

Risk Level: low — The company's risk level is low, evidenced by its 'well capitalized' status with a Total capital to risk weighted assets ratio of 16.05% at September 30, 2025, significantly above the 10.00% minimum. Furthermore, the allowance for credit losses increased to $7.967 million from $7.684 million, indicating prudent risk management despite loan growth.

Analyst Insight

Investors should consider initiating or increasing positions in NWPP. The strong net income growth of 29.05% and robust capital ratios suggest a financially sound institution with good growth prospects. Monitor future loan growth and interest rate trends, as these are key drivers for regional banks.

Financial Highlights

debt To Equity

0.28

revenue

$35,918,000

operating Margin

N/A

total Assets

$910,724,000

total Debt

$21,986,000

net Income

$7,198,000

eps

$0.30

gross Margin

N/A

cash Position

$80,710,000

revenue Growth

+8.28%

Revenue Breakdown

Key Numbers

• $7.198M — Net Income (Increased by 29.05% for the nine months ended September 30, 2025, compared to $5.578 million in 2024.)
• $31.669M — Loans including fees income (Increased from $28.316 million for the nine months ended September 30, 2024, indicating strong loan growth.)
• $910.724M — Total Assets (Increased by 6.52% from $854.925 million at December 31, 2024.)
• $79.528M — Total Shareholders' Equity (Increased by 12.42% from $70.741 million at December 31, 2024.)
• 16.05% — Total capital to risk weighted assets ratio (As of September 30, 2025, exceeding the 10.00% minimum for 'well capitalized' status.)
• $0.30 — Basic and diluted earnings per share (For the nine months ended September 30, 2025, up from $0.24 in 2024.)
• $707.272M — Loans receivable (Increased from $657.536 million at December 31, 2024, reflecting significant loan portfolio expansion.)
• $799.376M — Total deposits (Increased from $749.982 million at December 31, 2024, showing strong deposit growth.)
• $8,326 — Accumulated other comprehensive loss (Reduced from $11,984 at December 31, 2024, improving shareholder equity.)
• $602 — Provision for credit losses (Increased from $478 for the nine months ended September 30, 2024, reflecting loan portfolio growth.)

Key Players & Entities

• NEW PEOPLES BANKSHARES INC (company) — registrant
• New Peoples Bank, Inc. (company) — subsidiary bank
• Virginia Bureau of Financial Institutions (regulator) — state regulator
• Federal Deposit Insurance Corporation (regulator) — federal regulator
• Board of Governors of the Federal Reserve System (regulator) — federal regulator
• FASB (regulator) — accounting standards setter
• ASU 2023-09 (regulator) — accounting standard update
• NPB Insurance Services, Inc. (company) — subsidiary
• NPB Web Services, Inc. (company) — subsidiary
• Bloomberg (company) — publisher

FAQ

Risk Factors

• Regulatory Compliance Burden [medium — regulatory]: As a state-chartered member bank, New Peoples Bank, Inc. is subject to regulation by the Virginia Bureau of Financial Institutions, FDIC, and the Federal Reserve. Changes in regulations or increased compliance costs could impact operations and profitability.
• Credit Loss Provisions [medium — financial]: The provision for credit losses increased to $602,000 for the nine months ended September 30, 2025, from $478,000 in the prior year, reflecting loan portfolio growth. Significant economic downturns could lead to higher credit losses.
• Interest Rate Sensitivity [medium — market]: The bank's net interest income is sensitive to changes in interest rates. While net interest income grew, fluctuations in deposit and loan rates can impact profitability.
• Operational and Cybersecurity Risks [medium — operational]: Like all financial institutions, the company faces risks related to operational failures, system disruptions, and cybersecurity threats, which could lead to financial losses and reputational damage.

Industry Context

New Peoples Bankshares operates as a community bank, providing traditional banking services in a specific geographic region. The banking industry is characterized by intense competition, evolving regulatory landscapes, and sensitivity to interest rate movements. Growth in loan and deposit segments is crucial for profitability, alongside effective management of credit risk and operational efficiency.

Regulatory Implications

As a state-chartered member bank, New Peoples is subject to oversight from multiple regulatory bodies, including the FDIC and the Federal Reserve. Compliance with capital requirements, lending regulations, and consumer protection laws is paramount. Any shifts in regulatory policy or enforcement could present compliance challenges and impact operational costs.

What Investors Should Do

1. Monitor loan growth and credit quality trends.
2. Assess interest rate sensitivity and net interest margin.
3. Evaluate capital adequacy ratios.
4. Review non-interest income diversification.

Key Dates

• 2025-09-30: Nine months ended September 30, 2025 — Reported strong net income growth of 29.05% to $7.198 million and expansion in total assets to $910.724 million.
• 2025-12-31: As of December 31, 2024 — Previous period's financial position, with total assets of $854.925 million and total shareholders' equity of $70.741 million.

Glossary

Provision for credit losses

An expense set aside by a financial institution to cover potential losses from loans that may not be repaid. (An increase in this provision, as seen in the nine months ended September 30, 2025, indicates management's anticipation of potential loan defaults, often tied to loan portfolio growth.)

Accumulated other comprehensive loss

A component of shareholders' equity that includes unrealized gains and losses on certain investments and foreign currency translations that have not yet been realized. (A reduction in this loss, from $11,984,000 to $8,326,000, positively impacts total shareholders' equity.)

Total capital to risk weighted assets ratio

A measure of a bank's capital adequacy, comparing its total capital to its risk-weighted assets. It indicates the bank's ability to absorb losses. (The ratio of 16.05% signifies that New Peoples Bankshares is 'well capitalized' and exceeds regulatory minimums.)

Net interest income

The difference between the interest income a bank generates from its loans and investments and the interest it pays out on deposits and borrowings. (A key profitability metric for banks; it grew by 15.80% to $23.859 million after provision for credit losses for the nine months ended September 30, 2025.)

Year-Over-Year Comparison

Compared to the prior year's nine-month period, New Peoples Bankshares has demonstrated robust growth. Net income surged by 29.05% to $7.198 million, driven by a significant increase in loan income. Total assets grew by 6.52% to $910.724 million, and shareholder equity saw a healthy rise of 12.42% to $79.528 million. While the provision for credit losses increased, indicating proactive risk management, the overall financial health appears strong, with key capital ratios well above regulatory minimums.

Key Financial Figures

• $0.07 — 2,572 2,572 Cash dividend declared ($0.07 per share) — — — ( 1,661 ) — ( 1,
• $0.08 — 3,658 3,658 Cash dividend declared ($0.08 per share) — — — ( 1,889 ) — ( 1,
• $3.0 billion — a bank must have consolidated assets of $3.0 billion or less. The primary benefit of being d

Filing Documents

• nwpp_10q.htm (10-Q) — 2430KB
• ex31_1.htm (EX-31.1) — 11KB
• ex31_2.htm (EX-31.2) — 11KB
• ex32.htm (EX-32) — 11KB
• 0001903596-25-000540.txt ( ) — 11422KB
• nwpp-20250930.xsd (EX-101.SCH) — 46KB
• nwpp-20250930_cal.xml (EX-101.CAL) — 66KB
• nwpp-20250930_def.xml (EX-101.DEF) — 147KB
• nwpp-20250930_lab.xml (EX-101.LAB) — 349KB
• nwpp-20250930_pre.xml (EX-101.PRE) — 307KB
• nwpp_10q_htm.xml (XML) — 3260KB

Financial Statements

Financial Statements Consolidated Balance Sheets - September 30, 2025 (Unaudited) and December 31, 202 3 Consolidated 4 Consolidated 5 Consolidated (Unaudited) 6 Consolidated 7

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 8 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 23 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 33 Item 4.

Controls and Procedures

Controls and Procedures 33 PART II OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 34 Item 1A.

Risk Factors

Risk Factors 34 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 34 Item 3. Defaults upon Senior Securities 34 Item 4. Mine Safety Disclosures 35 Item 5. Other Information 35 Item 6. Exhibits 35

Financial

Part I Financial Information

Financial

Item 1 Financial NEW PEOPLES BANKSHARES, INC. CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2025 AND DECEMBER 31, 2024 (IN THOUSANDS EXCEPT PER SHARE AND SHARE DATA) (UNAUDITED) September 30, December 31, 2025 2024 ASSETS Cash and due from banks 13,686 $ 13,218 Interest-bearing deposits with banks 66,538 54,300 Federal funds sold 486 150 Total cash and cash equivalents 80,710 67,668 Investment securities available-for-sale, at fair value 96,153 95,984 Loans receivable 707,272 657,536 Allowance for credit losses ( 7,967 ) ( 7,684 ) Net loans 699,305 649,852 Bank premises and equipment, net 16,689 17,070 Other real estate owned 89 87 Accrued interest receivable 3,849 3,458 Deferred taxes, net 3,837 4,809 Insurance benefit receivable — 5,417 Right-of-use assets – operating leases 3,117 3,413 Other assets 6,975 7,167 Total assets 910,724 $ 854,925 LIABILITIES Deposits: Noninterest bearing 228,881 $ 224,938 Interest-bearing 570,495 525,044 Total deposits 799,376 749,982 Borrowed funds 21,986 24,986 Lease liabilities – operating leases 3,117 3,413 Accrued interest payable 1,491 1,442 Accrued expenses and other liabilities 5,226 4,361 Total liabilities 831,196 784,184 SHAREHBOLDERS' EQUITY Common stock - $ 2.00 par value; 50,000,000 shares authorized; 23,577,193 and 23,636,724 shares issued and outstanding at September 30, 2025 and December 31, 2024, respectively 47,154 47,273 Additional paid-in-capital 14,390 14,451 Retained earnings 26,310 21,001 Accumulated other comprehensive loss ( 8,326 ) ( 11,984 ) Total shareholders' equity 79,528 70,741 Total liabilities and shareholders' equity 910,724 $ 854,925 The accompanying notes are an integral part of these consolidated financial statements. 3 NEW PEOPLES BANKSHARES, INC. CONSOLIDATED FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS NOTE 1 NATURE OF OPERATIONS Nature of Operations – New Peoples Bankshares, Inc. (New Peoples or the Company) is a financial holding company whose principal activity is the under the laws of the Commonwealth of Virginia. As a state-chartered member bank, the Bank is subject to regulation by the Virginia Bureau of Financial Institutions, the Federal Deposit Insurance Corporation and the Board of Governors of the Federal Reserve System (the Federal Reserve). The Bank provides general banking services to individuals, small and medium size businesses and the professional community of southwest Virginia, southern West Virginia, western North Carolina and northeastern Tennessee. These services include commercial and consumer loans along with traditional deposit products such as checking and savings accounts. NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES These consolidated financial statements conform to U. S. generally accepted accounting principles (GAAP) and to general industry practices. In the opinion of management, the accompanying consolidated financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the Company's financial position as of September 30, 2025 and December 31, 2024, and the results of operations for the three- and nine-month periods ended September 30, 2025 and 2024. The Notes included herein should be read in conjunction with the notes to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2024. The results of operations for interim periods are not necessarily indicative of the results of operations that may be expected for a full year or any future period. The consolidated financial statements include New Peoples, the Bank, NPB Insurance Services, Inc.

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