Old Point Releases 2014 Results

·	Net income increases $953 thousand

·	Net loans increase $35.1 million

·	Interest margin improves to 3.57%

Assets as of December 31, 2014 were $876.3 million, an increase of $12.0 million or 1.39% when compared to December 31, 2013. During 2014, Old Point continued to grow loans, funding this growth mainly from the securities portfolio. Net loans grew $35.1 million, or 7.10%, over the year, while securities declined $23.1 million. As loans typically bear higher yields than securities, total interest and dividend income increased $466 thousand when comparing 2013 and 2014. This shift from securities to loans increased Old Point's net interest margin for 2014 to 3.57%, from 3.23% for 2013.

Also during 2014, Old Point's efforts to reduce high-cost time deposits, as well as to shift assets from securities to loans, contributed to the improved interest margin. The increase in interest income and decrease in interest expense led to an increase in net interest income (before the provision) of $1.3 million when comparing the year ended December 31, 2014 to the year ended December 31, 2013. Recoveries in 2014 contributed to the reduced provision for loan losses by more than half, compared to 2013. The combination of the improved net interest margin and reduced provision resulted in an increase of $2.0 million, or 8.38%, to net interest income after the provision for loan losses when comparing the years ended December 31, 2013 and December 31, 2014.

Noninterest expense increased $1.1 million for the year ended December 31, 2014, as compared to 2013. The largest increases were in employer-provided healthcare benefits, included on the income statement in salaries and employee benefits, and occupancy and equipment expenses. Occupancy and equipment expenses increased $490 thousand, or 11.15% when comparing 2014 and 2013, due to the completion of Old Point's new corporate headquarters. These increases in noninterest expense were partially offset by a decrease in loss on write-down/sale of other real estate owned. Losses on other real estate owned were elevated in 2013 due to the write-down on a single piece of property. The value of this property declined sharply due to the foreclosure by other banks of similar property in the area. There were no similar write-offs in 2014.

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Other items of note:

Non-Performing Assets (NPAs) decreased from $18.3 million as of December 31, 2013 to $11.8 million as of December 31, 2014. NPAs do not include restructured loans that are performing in accordance with their modified terms. Loans past due 90 days or more but still accruing interest, a component of NPAs, totaled $1.1 million as of December 31, 2014, of which $1.0 million were student loans that are 97-98% guaranteed by the U.S. Government. Old Point expects to experience minimal losses on these government-guaranteed loans. None of the guaranteed loans were 90 days past due as of December 31, 2013, as Old Point purchased the portfolio in November of 2013.

Allowance for Loan and Lease Losses (ALLL) as of December 31, 2014 and December 31, 2013 was 1.32% and 1.36% of total loans, respectively.

Net loans charged off as a percent of total loans (annualized) were 0.07% for the year ended December 31, 2014, compared to 0.36% in 2013. This decline in net charge-offs was partially due to loan recoveries received during 2014.

Safe Harbor Statement Regarding Forward-Looking Statements. Statements in this press release which express "belief," "intention," "expectation," and similar expressions, identify forward-looking statements. These forward-looking statements are based on the beliefs of Old Point's management, as well as estimates and assumptions made by, and information currently available to, management. These statements are inherently uncertain, and there can be no assurance that the underlying estimates or assumptions will prove to be accurate. Actual results could differ materially from historical results or those anticipated by such statements. Factors that could have a material adverse effect on the operations and future prospects of Old Point include, but are not limited to, changes in: interest rates; general economic and business conditions, including unemployment levels; demand for loan products; the legislative/regulatory climate; monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board; the quality or composition of the loan or investment portfolios; the level of net charge-offs on loans; deposit flows; competition; demand for financial services in Old Point's market area; technology; reliance on third parties for key services; the real estate market; Old Point's expansion initiatives; accounting principles, policies and guidelines; and other factors detailed in Old Point's publicly filed documents, including its Annual Report on Form 10-K for the year ended December 31, 2013. These risks and uncertainties should be considered in evaluating the forward-looking statements contained herein, and readers are cautioned not to place undue reliance on such statements, which speak only as of date of the release.

Old Point Financial Corporation ("OPOF" - Nasdaq) is the parent company of The Old Point National Bank of Phoebus, a locally owned and managed community bank serving all of Hampton Roads and Old Point Trust & Financial Services, N.A., a Hampton Roads wealth management services provider. Web: www.oldpoint.com. For more information, contact Erin Black, Vice President/Marketing Director, Old Point National Bank at 757- 251-2792.

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Old Point Financial Corporation and Subsidiaries
Consolidated Balance Sheets		December 31,				December 31,
(dollars in thousands, except per share data)		2014				2013
		(unaudited)
Assets
Cash and due from banks		$	31,081			$	11,802
Interest-bearing due from banks			833				18,045
Federal funds sold			1,391				1,478
Cash and cash equivalents			33,305				31,325
Securities available-for-sale, at fair value			139,346				155,639
Securities held-to-maturity (fair value approximates $94,406 and $97,453)			90,089				96,847
Restricted securities			2,293				2,378
Loans, net of allowance for loan losses of $7,075 and $6,831			528,919				493,868
Premises and equipment, net			42,075				40,546
Bank-owned life insurance			23,525				22,673
Other real estate owned, net of valuation allowance of $2,908 and $2,775			5,106				6,415
Other assets			11,622				14,597
Total assets		$	876,280			$	864,288
Liabilities & Stockholders' Equity
Deposits:
Noninterest-bearing deposits		$	186,280			$	182,513
Savings deposits			307,078				286,085
Time deposits			223,296				256,807
Total deposits			716,654				725,405
Overnight repurchase agreements			37,404				31,175
Term repurchase agreements			412				411
Federal Home Loan Bank advances			30,000				25,000
Accrued expenses and other liabilities			3,313				1,536
Total liabilities			787,783				783,527
Commitments and contingencies			0				0
Stockholders' equity:
Common stock, $5 par value, 10,000,000 shares authorized;
4,959,009 shares issued and outstanding			24,795				24,795
Additional paid-in capital			16,392				16,392
Retained earnings			53,203				50,376
Accumulated other comprehensive loss, net			(5,893	)			(10,802	)
Total stockholders' equity			88,497				80,761
Total liabilities and stockholders' equity		$	876,280			$	864,288

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Old Point Financial Corporation and Subsidiaries
Consolidated Statements of Income
(dollars in thousands, except per share data)		Year Ended
		December 31,
		2014				2013
		(unaudited)
Interest and Dividend Income:
Interest and fees on loans		$	24,881			$	23,735
Interest on due from banks			13				96
Interest on federal funds sold			5				1
Interest on securities:
Taxable			3,562				4,547
Tax-exempt			1,703				1,348
Dividends and interest on all other securities			125				96
Total interest and dividend income			30,289				29,823
Interest Expense:
Interest on savings deposits			230				302
Interest on time deposits			2,354				3,119
Interest on federal funds purchased, securities sold under
agreements to repurchase and other borrowings			32				35
Interest on Federal Home Loan Bank advances			1,233				1,224
Total interest expense			3,849				4,680
Net interest income			26,440				25,143
Provision for loan losses			600				1,300
Net interest income after provision for loan losses			25,840				23,843
Noninterest Income:
Income from fiduciary activities			3,506				3,553
Service charges on deposit accounts			4,119				4,183
Other service charges, commissions and fees			3,940				3,562
Income from bank-owned life insurance			851				848
Income (loss) from Old Point Mortgage			46				439
Loss on sale of available-for-sale securities, net			2				(26	)
Other operating income			180				214
Total noninterest income			12,644				12,773
Noninterest Expense:
Salaries and employee benefits			19,884				19,108
Occupancy and equipment			4,886				4,396
Data processing			1,663				1,630
FDIC insurance			704				719
Customer development			822				809
Legal and audit expenses			606				539
Other outside service fees			584				459
Employee professional development			721				595
Postage and courier			445				481
Stationery and supplies			446				457
Capital stock tax			499				400
Loss on write-down/sale of other real estate owned			872				1,345
Other operating expenses			2,040				2,167
Total noninterest expense			34,172				33,105
Income (loss) before income taxes			4,312				3,511
Income tax expense (benefit)			196				348
Net income		$	4,116			$	3,163
Basic Earnings per Share:
Average shares outstanding			4,959,009				4,959,009
Net income per share of common stock		$	0.83			$	0.64
Diluted Earnings per Share:
Average shares outstanding			4,959,009				4,959,009
Net income per share of common stock		$	0.83			$	0.64
Cash Dividends Declared per Share:		$	0.26			$	0.22

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Old Point Financial Corporation and Subsidiaries
Selected Ratios		December 31,
		2014				2013
Net Interest Margin Year-to-Date			3.57	%			3.23	%
NPAs/Total Assets			1.35	%			2.12	%
Annualized Net Charge Offs/Total Loans			0.07	%			0.36	%
Allowance for Loan Losses/Total Loans			1.32	%			1.36	%
Non-Performing Assets (NPAs) (in thousands)
Nonaccrual Loans		$	5,570			$	11,324
Loans > 90 days past due, but still accruing interest			1,141				546
Non-Performing Restructured Loans			0				0
Other real estate owned			5,106				6,415
Total Non-Performing Assets		$	11,817			$	18,285
Other Selected Numbers (in thousands)
Loans Charged Off Year-to-Date, net of recoveries		$	356			$	1,793
Year-to-Date Average Loans		$	517,183			$	471,203
Year-to-Date Average Assets		$	869,965			$	881,378
Year-to-Date Average Earning Assets		$	767,865			$	799,723
Year-to-Date Average Deposits		$	720,599			$	737,358
Year-to-Date Average Equity		$	85,550			$	84,695