Here are a few analogies for Virginia National Bankshares (VABK):

• Imagine a regional Bank of America for Virginia, with a strong focus on personalized wealth and trust services.

• Think of it as a full-service community bank, similar to a local branch of Wells Fargo, but independent and focused entirely on Virginia.

• It's like a smaller, Virginia-specific version of a diversified regional financial institution such as PNC or Truist.

• Depository Accounts: The company offers various checking, savings, money market, and time deposit accounts, including certificates of deposit and individual retirement accounts.
• Lending Services: It provides a wide range of loans, including commercial and industrial, real estate construction, commercial real estate, 1-4 family residential mortgages, and consumer loans like student and revolving credit.
• Digital & Treasury Services: These include automated teller machines, internet banking, treasury management, cash management, and merchant and debit card services.
• Wealth Management & Advisory: Through Sturman Wealth Advisors, the bank offers wealth and investment advisory, brokerage, insurance, and consulting services.
• Trust & Estate Administration: VNB Trust and Estate Services provides investment management, corporate trustee, trust and estate administration, IRA administration, and custody services.

Major Customers of Virginia National Bankshares (VABK)

Virginia National Bankshares (VABK) primarily serves three categories of customers:

• Individuals: For services such as checking accounts, savings accounts, money market accounts, individual retirement accounts (IRAs), 1-4 family residential mortgages, student loans, revolving credit, wealth and investment advisory, trust and estate administration, and other consumer banking products.
• Businesses: For commercial banking services, commercial and industrial loans, real estate construction and land loans, commercial real estate loans, demand deposits, NOW accounts, treasury and cash management services, merchant services, corporate trustee services, and investment advisory.
• Charitable Organizations: For various banking, investment management, and trust services tailored to their specific needs.

Glenn W. Rust, President and Chief Executive Officer

Glenn W. Rust has over 50 years of experience in financial services, technology, and network systems design. He served as a substantial expert on internet security and banking while working with the National Infrastructure Advisory Council shortly after the September 11, 2001 attacks. Prior to joining Virginia National Bank in 2006, he held various executive management positions at Texas Commerce Bank, Chemical Bank, J.P. Morgan, Chase, and Sterling Bank. Mr. Rust brings wide-ranging executive bank management experience and expertise in successfully managing growth opportunities.

Cathy W. Liles, Executive Vice President and Chief Financial Officer

Cathy W. Liles assumed the Chief Financial Officer position effective November 21, 2025. She brings many years of industry experience and has served as the primary financial and accounting leader of similar-sized organizations, possessing a strong audit, accounting, and financial background. Previously, Ms. Liles served as the Senior Vice President and Chief Financial Officer of Hampton-based Old Point National Bank and its bank holding company, Old Point Financial.

Virginia R. Bayes, Executive Vice President, Chief Banking Officer

Virginia R. Bayes is responsible for Virginia National Bank's lending and credit administration functions, including loan and commercial deposit growth, credit approval, credit policy, and portfolio risk management. She joined the Bank in 1998 and was named an executive officer in January 2011, bringing over 30 years of experience on the credit side of banking. Prior to Virginia National Bank, she held various positions in credit administration and loan review with NationsBank (now Bank of America) and Wachovia Bank (now Wells Fargo).

John Dane, Executive Vice President, Market President - Richmond

John Dane is the Executive Vice President and Market President for the Richmond area, where he leads the commercial lending activities.

The public company Virginia National Bankshares (VABK) faces several key risks inherent to the banking industry and its specific operations.

1. Interest Rate Risk

   Virginia National Bankshares' profitability is significantly influenced by interest rate fluctuations. As a financial institution, its net interest income, which is the difference between interest earned on assets (like loans) and interest paid on liabilities (like deposits), is directly exposed to changes in market interest rates. Unfavorable shifts in interest rates could adversely affect the company's financial performance, including its net interest margin and overall profitability. The company actively manages this risk, but any sudden, unexpected moves by the Federal Reserve, such as sharp, unanticipated rate hikes, could rapidly reverse positive net interest margin trends by increasing deposit competition and borrowing costs.

2. Credit Risk

   The company faces substantial credit risks, particularly given its focus on lending to small and mid-sized businesses, which are generally more susceptible to economic downturns. VABK's loan portfolio includes commercial and industrial loans, real estate construction and land loans, commercial real estate loans, and residential mortgages. The adoption of new accounting standards like ASC 326 (CECL) has also introduced volatility in the estimation of potential loan losses. Deterioration in the economic environment, including factors like reduced consumer spending or regional recessionary risks, could lead to a decline in credit quality within its service area, impacting the ability of borrowers to repay loans and potentially increasing the company's allowance for credit losses.

3. Regulatory Environment and Competition

   As a bank holding company, Virginia National Bankshares is subject to extensive governmental regulation at federal and state levels. Changes in laws, regulations, or regulatory policies can increase compliance costs and limit business opportunities. Recent developments in the banking industry, such as high-profile bank failures in 2023, have led to increased regulatory scrutiny on regional banks, regardless of asset size. This intensified focus by regulators on liquidity risk management, concentration of uninsured deposits, and exposure to Commercial Real Estate (CRE) can result in higher compliance burdens and increased noninterest expenses for VABK. Furthermore, the company operates in a highly competitive environment, competing with national, regional, and community banks, as well as non-banking financial institutions and fintech companies, which impacts its ability to attract deposits and make loans, thereby affecting its market share and profitability.

Virginia National Bankshares faces clear emerging threats from the ongoing digital transformation of the financial services industry. These threats manifest as:

• Digital-only banks and fintech companies: These agile, technology-driven competitors offer banking services (deposits, loans, wealth management) with greater convenience, often lower fees, and superior digital experiences. They directly challenge Virginia National Bankshares' traditional branch-based model and existing digital offerings by attracting customers who prioritize digital solutions over physical branch access.
• Specialized non-bank lenders: These entities focus on specific lending segments (e.g., mortgages, small business loans) and often leverage technology to provide faster processing, greater efficiency, and more tailored products, potentially siphoning off loan origination volume from traditional banks.
• Big Tech companies entering financial services: Giants like Apple, Google, and Amazon are increasingly leveraging their vast user bases, data analytics, and technological platforms to offer payment services, savings accounts, and other financial products, posing a threat to traditional banks' customer relationships and market share.

Virginia National Bankshares (VABK) operates within several addressable markets primarily focused on Virginia.

Commercial Banking Services and Loans

The banking sector in Virginia represents a significant addressable market. As of Q2 2024, banks in Virginia held approximately $296 billion in deposits. The commercial banking industry in Virginia has shown growth, expanding at an average annual rate of 9.2% from 2021 to 2026.

Specific loan markets within Virginia demonstrate substantial sizes:

• New home loans booked in Virginia in 2024 totaled approximately $35.2 billion.
• Small business loans in Virginia amounted to around $14 billion.
• Small farm loans in Virginia were approximately $1.1 billion.

Wealth and Investment Advisory, Brokerage, and Investment Management Services

The market for portfolio management and investment advice in Virginia is considerable, with a projected market size of $5.7 billion in 2026. This market includes services such as asset management, financial planning, and investment advisory.

Trust and Estate Administration Services

While a precise overall market size in dollar terms for trust and estate administration services in Virginia is not readily available, the market is active and significant. For example, one law group in the Hampton Roads area of Virginia reported facilitating the transfer of over $10 billion in family wealth. These services encompass estate planning, trust creation and administration, and wealth transfer.

Virginia National Bankshares (VABK) is expected to drive future revenue growth over the next 2-3 years through a combination of strategic loan expansion, enhanced non-interest income from its wealth management segments, deepening customer relationships, and potential strategic market expansion.

Here are 4 expected drivers of future revenue growth:

1. Net Interest Income Growth through Strategic Loan Portfolio Expansion and Effective Interest Rate Management: Virginia National Bankshares aims to prioritize loan growth with strong credit standards, which directly contributes to its net interest income. The company has demonstrated its ability to expand its net interest margin (NIM) by effectively managing its interest expense on deposits and borrowings, while maintaining steady yields on earning assets, as seen in its 2025 financial performance. Continued focus on both the volume and profitability of its loan portfolio will be crucial.
2. Increased Non-Interest Income from Wealth Management and Enhanced Fee-Based Services: The company operates through segments like Sturman Wealth Advisors and VNB Trust and Estate Services, offering a range of wealth and investment advisory, brokerage, insurance, consulting, and trust services. Growing the customer base and assets under management for these services presents a significant opportunity to increase non-interest income, despite some recent declines in wealth management fees.
3. Organic Customer Acquisition and Relationship Deepening within Current Markets: As a community bank, VABK's operational framework emphasizes building deep, local relationships with individuals, businesses, and charitable organizations across its core Virginia markets. This customer-focused strategy drives both deposit growth, providing a stable funding source for lending, and further opportunities for cross-selling various banking and wealth management services within its existing footprint.
4. Strategic Market Expansion, Potentially through Acquisitions: While the company has established a presence across key Virginia markets, it has a history of growth through acquisition-led expansion to extend its geographic footprint. Further strategic acquisitions or organic expansion into contiguous or underserved markets could serve as a driver for increased loan and deposit volumes, thereby boosting overall revenue.