##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2010
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from _______________ to _______________
 Commission File Number 0-20402
 WILSON BANK HOLDING COMPANY
  Tennessee
    
    62-1497076(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer Identification No.)
 623 West Main Street, Lebanon, TN
    
    37087(Address of principal executive offices)
    
    Zip Code
 (Registrants telephone number, including area code)
 (Former name, former address and former fiscal year, if changed since last report)
  þ o
  o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
(Do not check if a smaller reporting company)
    
    Smaller reporting company o
  o þ




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##### 



Part I: FINANCIAL INFORMATION
    
    
    3Item 1. Financial Statements
    
    
    3The unaudited consolidated financial statements of the Company and its subsidiaries are as
follows:Consolidated Balance Sheets  September 30, 2010 and December 31, 2009
    
    
    3Consolidated Statements of Earnings  For the three months and nine months ended
September 30, 2010 and 2009
    
    
    4Consolidated Statements of Comprehensive Earnings  For the three months and nine
months ended September 30, 2010 and 2009
    
    
    5Consolidated Statements of Cash Flows  For the nine months ended September 30, 2010
and 2009
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations
    
    
    21Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    33Disclosures required by Item 3 are incorporated by reference to Managements
Discussion and Analysis of Financial Condition and Results of OperationsItem 4. Controls and Procedures
    
    
    34Part II: OTHER INFORMATION
    
    
    35Item 1. Legal Proceedings
    
    
    35Item 1A. Risk Factors
    
    
    35Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    35Item 3. Defaults Upon Senior Securities
    
    
    35Item 4. (Removed and Reserved)
    
    
    35Item 5. Other Information
    
    
    35Item 6. Exhibits
    
    
    36Signatures
    
    
    37EX-31.1 SECTION 302 CERTIFICATION OF THE CEOEX-31.2 SECTION 302 CERTIFICATION OF THE CFOEX-32.1 SECTION 906 CERTIFICATION OF THE CEOEX-32.2 SECTION 906 CERTIFICATION OF THE CFO
   2




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##### Table of Contents



Part I. Financial Information
 
 Item 1.
    
    Financial Statements
 WILSON BANK HOLDING COMPANY
 
 Consolidated Balance Sheets
 September 30, 2010 and December 31, 2009
 (Unaudited)
 September 30,
    
    
    December 31,2010
    
    
    2009(Dollars in ThousandsExcept Per Share Amounts)AssetsLoans
    
    $
    1,100,569
    
    
    $
    1,115,261Less: Allowance for loan losses
    
    
    (21,010
    )
    
    
    (16,647
    )Net loans
    
    
    1,079,559
    
    
    
    1,098,614Securities:Held to maturity, at cost (market value $13,663 and $12,608, respectively)
    
    
    12,984
    
    
    
    12,170Available-for-sale, at market (amortized cost $273,665 and $250,412,
respectively)
    
    
    274,621
    
    
    
    249,647Total securities
    
    
    287,605
    
    
    
    261,817Loans held for sale
    
    
    13,583
    
    
    
    5,027Restricted equity securities
    
    
    3,012
    
    
    
    3,012Federal funds sold
    
    
    9,800
    
    
    
    5,450Total earning assets
    
    
    1,393,559
    
    
    
    1,373,920Cash and due from banks
    
    
    39,245
    
    
    
    26,062Bank premises and equipment, net
    
    
    31,836
    
    
    
    30,865Accrued interest receivable
    
    
    6,656
    
    
    
    7,563Deferred income tax
    
    
    4,874
    
    
    
    5,457Other real estate
    
    
    11,666
    
    
    
    3,924Other assets
    
    
    11,537
    
    
    
    10,508Goodwill
    
    
    4,805
    
    
    
    4,805Other intangible assets, net
    
    
    607
    
    
    
    904Total assets
    
    $
    1,504,785
    
    
    $
    1,464,008Liabilities and Stockholders EquityDeposits
    
    $
    1,344,480
    
    
    $
    1,310,706Securities sold under repurchase agreements
    
    
    6,228
    
    
    
    6,499Federal Home Loan Bank advances
    
    
    
    
    
    
    13Accrued interest and other liabilities
    
    
    7,500
    
    
    
    7,233Total liabilities
    
    
    1,358,208
    
    
    
    1,324,451Stockholders equity:Common stock, $2.00 par value; authorized 15,000,000 shares, 7,225,073
and 7,147,582 shares issued at September 30, 2010 and
December 31, 2009, respectively
    
    
    14,450
    
    
    
    14,295Additional paid-in capital
    
    
    43,785
    
    
    
    41,022Retained earnings
    
    
    87,752
    
    
    
    84,712Net unrealized gains (losses) on available-for-sale securities, net of income
taxes of $366 and $293, respectively
    
    
    590
    
    
    
    (472
    )Total stockholders equity
    
    
    146,577
    
    
    
    139,557Total liabilities and stockholders equity
    
    $
    1,504,785
    
    
    $
    1,464,008
  3




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##### Table of Contents



WILSON BANK HOLDING COMPANY
 
 Consolidated Statements of Earnings
 Three Months and Nine Months Ended September 30, 2010 and 2009
 (Unaudited)
 Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2010
    
    
    2009
    
    
    2010
    
    
    2009(Dollars In Thousands Except Per Share Amounts)Interest income:Interest and fees on loans
    
    $
    16,871
    
    
    $
    18,139
    
    
    $
    50,762
    
    
    $
    53,576Interest and dividends on securities:Taxable securities
    
    
    1,801
    
    
    
    2,164
    
    
    
    6,378
    
    
    
    6,989Exempt from Federal income taxes
    
    
    111
    
    
    
    124
    
    
    
    345
    
    
    
    359Interest on loans held for sale
    
    
    73
    
    
    
    49
    
    
    
    153
    
    
    
    217Interest on Federal funds sold
    
    
    23
    
    
    
    13
    
    
    
    64
    
    
    
    60Interest and dividends on restricted securities
    
    
    40
    
    
    
    27
    
    
    
    102
    
    
    
    111Total interest income
    
    
    18,919
    
    
    
    20,516
    
    
    
    57,804
    
    
    
    61,312Interest expense:Interest on negotiable order of withdrawal accounts
    
    
    659
    
    
    
    597
    
    
    
    1,986
    
    
    
    1,779Interest on money market and savings accounts
    
    
    836
    
    
    
    910
    
    
    
    2,511
    
    
    
    2,579Interest on certificates of deposit
    
    
    4,331
    
    
    
    5,973
    
    
    
    14,300
    
    
    
    18,792Interest on securities sold under repurchase
Agreements
    
    
    16
    
    
    
    24
    
    
    
    56
    
    
    
    83Interest on Federal Home Loan Bank advances
    
    
    
    
    
    
    97
    
    
    
    1
    
    
    
    415Interest on Federal funds purchased
    
    
    
    
    
    
    1
    
    
    
    
    
    
    
    1Total interest expense
    
    
    5,842
    
    
    
    7,602
    
    
    
    18,854
    
    
    
    23,649Net interest income before provision for
loan losses
    
    
    13,077
    
    
    
    12,914
    
    
    
    38,950
    
    
    
    37,663Provision for loan losses
    
    
    1,989
    
    
    
    1,164
    
    
    
    10,168
    
    
    
    4,525Net interest income after provision for
loan losses
    
    
    11,088
    
    
    
    11,750
    
    
    
    28,782
    
    
    
    33,138Non-interest income:Service charges on deposit accounts
    
    
    1,386
    
    
    
    1,514
    
    
    
    4,052
    
    
    
    4,289Other fees and commissions
    
    
    1,614
    
    
    
    1,340
    
    
    
    4,549
    
    
    
    3,794Gain on sale of loans
    
    
    780
    
    
    
    365
    
    
    
    1,501
    
    
    
    2,088Gain on sale of securities
    
    
    
    
    
    
    
    
    
    
    261
    
    
    
    500Other income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Total non-interest income
    
    
    3,780
    
    
    
    3,219
    
    
    
    10,363
    
    
    
    10,672Non-interest expense:Salaries and employee benefits
    
    
    5,159
    
    
    
    5,050
    
    
    
    14,024
    
    
    
    15,325Occupancy expenses, net
    
    
    608
    
    
    
    583
    
    
    
    1,788
    
    
    
    1,827Furniture and equipment expense
    
    
    309
    
    
    
    348
    
    
    
    1,034
    
    
    
    1,044Data processing expense
    
    
    327
    
    
    
    311
    
    
    
    930
    
    
    
    799Directors fees
    
    
    168
    
    
    
    182
    
    
    
    549
    
    
    
    578Advertising
    
    
    172
    
    
    
    224
    
    
    
    580
    
    
    
    654FDIC insurance expense
    
    
    577
    
    
    
    1,145
    
    
    
    1,663
    
    
    
    1,825Other operating expenses
    
    
    2,076
    
    
    
    1,702
    
    
    
    5,929
    
    
    
    5,436Loss on sale of other real estate
    
    
    339
    
    
    
    240
    
    
    
    601
    
    
    
    434Loss on sale of other assets
    
    
    11
    
    
    
    12
    
    
    
    19
    
    
    
    49Total non-interest expense
    
    
    9,746
    
    
    
    9,797
    
    
    
    27,117
    
    
    
    27,971Earnings before income taxes
    
    
    5,122
    
    
    
    5,172
    
    
    
    12,028
    
    
    
    15,839Income taxes
    
    
    2,022
    
    
    
    2,010
    
    
    
    4,688
    
    
    
    6,179Net earnings
    
    $
    3,100
    
    
    $
    3,162
    
    
    $
    7,340
    
    
    $
    9,660Weighted average number of shares outstanding-basic
    
    
    7,212,205
    
    
    
    7,115,969
    
    
    
    7,189,827
    
    
    
    7,087,938Weighted average number of shares outstanding-diluted
    
    
    7,220,713
    
    
    
    7,136,988
    
    
    
    7,197,416
    
    
    
    7,108,209Basic earnings per common share
    
    $
    .43
    
    
    $
    .44
    
    
    $
    1.02
    
    
    $
    1.36Diluted earnings per common share
    
    $
    .43
    
    
    $
    .44
    
    
    $
    1.02
    
    
    $
    1.36Dividends per share
    
    $
    .30
    
    
    $
    .32
    
    
    $
    .60
    
    
    $
    .62
  4




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WILSON BANK HOLDING COMPANY
 
 Consolidated Statements of Comprehensive Earnings
 Three Months and Nine Months Ended September 30, 2010 and 2009
 (Unaudited)
 Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2010
    
    
    2009
    
    
    2010
    
    
    2009(In Thousands)Net earnings
    
    $
    3,100
    
    
    $
    3,162
    
    
    $
    7,340
    
    
    $
    9,660Other comprehensive earnings (losses), net of tax:Unrealized gains on available-for-sale securities
arising during period, net of income taxes of
$419, $528, $759, and $178,
respectively
    
    
    677
    
    
    
    853
    
    
    
    1,223
    
    
    
    289Reclassification adjustment for net losses (gains)
included
in net earnings, net of taxes of $0, $0, $100 and $191,
respectively
    
    
    
    
    
    
    
    
    
    
    (161
    )
    
    
    (309
    )Other comprehensive earnings (losses)
    
    
    677
    
    
    
    853
    
    
    
    1,062
    
    
    
    (20
    )Comprehensive earnings
    
    $
    3,777
    
    
    $
    4,015
    
    
    $
    8,402
    
    
    $
    9,640
  5




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##### Table of Contents



WILSON BANK HOLDING COMPANY
 
 Consolidated Statements of Cash Flows
 Nine Months Ended September 30, 2010 and 2009
 Increase (Decrease) in Cash and Cash Equivalents
 (Unaudited)
 2010
    
    
    2009(In Thousands)Cash flows from operating activities:Interest received
    
    $
    59,069
    
    
    $
    61,203Fees and commissions received
    
    
    8,601
    
    
    
    8,084Proceeds from sale of loans
    
    
    86,718
    
    
    
    127,970Origination of loans held for sale
    
    
    (93,773
    )
    
    
    (127,008
    )Interest paid
    
    
    (19,939
    )
    
    
    (24,441
    )Cash paid to suppliers and employees
    
    
    (21,416
    )
    
    
    (22,822
    )Income taxes paid
    
    
    (7,970
    )
    
    
    (7,890
    )Net cash provided by operating activities
    
    
    11,290
    
    
    
    15,096Cash flows from investing activities:Proceeds from maturities, calls, and principal payments of held-to-maturity
Securities
    
    
    1,762
    
    
    
    1,658Proceeds from maturities, calls, and principal payments of available-for-sale
Securities
    
    
    367,352
    
    
    
    206,330Purchase of held-to-maturity securities
    
    
    (2,595
    )
    
    
    (2,558
    )Purchase of available-for-sale securities
    
    
    (390,683
    )
    
    
    (229,157
    )Loans made to customers, net of repayments
    
    
    (2,768
    )
    
    
    (37,693
    )Purchase of premises and equipment
    
    
    (2,225
    )
    
    
    (521
    )Proceeds from sale of other real estate
    
    
    3,193
    
    
    
    4,065Proceeds from sale of other assets
    
    
    114
    
    
    
    343Net cash used in investing activities
    
    
    (25,850
    )
    
    
    (57,533
    )Cash flows from financing activities:Net increase in non-interest bearing, savings and NOW
deposit accounts
    
    
    83,375
    
    
    
    23,360Net (decrease) increase in time deposits
    
    
    (49,601
    )
    
    
    16,256Net decrease in securities sold under repurchase agreements
    
    
    (271
    )
    
    
    (1,749
    )Repayment of advances from Federal Home Loan Bank
    
    
    (13
    )
    
    
    (13,607
    )Dividends paid
    
    
    (4,300
    )
    
    
    (4,379
    )Proceeds from sale of common stock
    
    
    3,052
    
    
    
    3,458Proceeds from exercise of stock options
    
    
    76
    
    
    
    199Repurchase of common stock
    
    
    (225
    )
    
    
    (697
    )Net cash provided by financing activities
    
    
    32,093
    
    
    
    22,841Net increase (decrease) in cash and cash equivalents
    
    
    17,533
    
    
    
    (19,596
    )Cash and cash equivalents at beginning of period
    
    
    31,512
    
    
    
    59,243Cash and cash equivalents at end of period
    
    $
    49,045
    
    
    $
    39,647
  6




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##### Table of Contents



WILSON BANK HOLDING COMPANY
Consolidated Statements of Cash Flows, Continued
Nine Months Ended September 30, 2010 and 2009
Increase (Decrease) in Cash and Cash Equivalents
(Unaudited)
 2010
    
    
    2009(In Thousands)Reconciliation of net earnings to net cash provided by
Operating activities:Net earnings
    
    $
    7,340
    
    
    $
    9,660Adjustments to reconcile net earnings to net cash provided by
operating activities:Depreciation and amortization
    
    
    1,909
    
    
    
    1,636Provision for loan losses
    
    
    10,168
    
    
    
    4,525Loss on sale of other real estate
    
    
    601
    
    
    
    434Loss on sale of other assets
    
    
    19
    
    
    
    49Security gains
    
    
    (261
    )
    
    
    (500
    )Stock based compensation
    
    
    15
    
    
    
    20Loss on write off of restricted equity securities
    
    
    
    
    
    
    88Increase in income tax receivable
    
    
    (2,978
    )
    
    
    (1,434
    )Increase in loans held for sale
    
    
    (8,556
    )
    
    
    (1,126
    )Increase in deferred tax assets
    
    
    (304
    )
    
    
    (277
    )Increase in other assets, net
    
    
    (1,043
    )
    
    
    (1,222
    )Decrease (increase) in interest receivable
    
    
    907
    
    
    
    (211
    )Increase in other liabilities
    
    
    4,558
    
    
    
    4,246Decrease in interest payable
    
    
    (1,085
    )
    
    
    (792
    )Total adjustments
    
    $
    3,950
    
    
    $
    5,436Net cash provided by operating activities
    
    $
    11,290
    
    
    $
    15,096Supplemental schedule of non-cash activities:Unrealized gain (loss) in values of securities
available-for-sale, net of taxes of $659,000
and $13,000 for the nine months ended
September 30, 2010 and 2009, respectively
    
    $
    1,062
    
    
    $
    (20
    )Non-cash transfers from loans to other real estate
    
    $
    11,940
    
    
    $
    3,109Non-cash transfers from other real estate to loans
    
    $
    404
    
    
    $
    Non-cash transfers from loans to other assets
    
    $
    119
    
    
    $
    312
  7




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WILSON BANK HOLDING COMPANY
Notes to Consolidated Financial Statements
(Unaudited)
 Note 1. Summary of Significant Accounting Policies
 Nature of Business
 Basis of Presentation
  Accounting Standards Codification The FASB Accounting
Standards Codification and the Hierarchy of Generally Accepted Accounting Principles, a replacement
of FASB Statement No. 162
 Use of Estimates
  8




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Recently Adopted Accounting Pronouncements
 Financial Accounting Standards Board Accounting Standards Codification Topic 860 Transfers and
Servicing  
  Subsequent Events (Topic 855)  Amendments to Certain Recognition and Disclosure
Requirements. Subsequent Events
 Improving Disclosures
about Fair Value Measurements.
 Recently Issued Accounting Standards
 Scope Exception Related to Embedded Credit
Derivatives
  9




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Disclosures about the Credit Quality of Financing
Receivables and the Allowance for Credit Losses
 Note 2. Loans and Allowance for Loan Losses
  (In Thousands)September 30,
    
    
    December 31,2010
    
    
    2009Mortgage Loans on real estateResidential 1-4 family
    
    $
    353,740
    
    
    
    374,684Multifamily
    
    
    8,748
    
    
    
    5,526Commercial
    
    
    341,321
    
    
    
    324,824Construction
    
    
    182,127
    
    
    
    198,732Farmland
    
    
    42,453
    
    
    
    14,090Second mortgages
    
    
    16,795
    
    
    
    16,847Equity lines of credit
    
    
    37,333
    
    
    
    35,954Total mortgage loans on real estate
    
    
    982,517
    
    
    
    970,657Commercial loans
    
    
    54,380
    
    
    
    74,748Agriculture loans
    
    
    3,105
    
    
    
    3,093Consumer installment loansPersonal
    
    
    53,237
    
    
    
    60,792Credit cards
    
    
    2,862
    
    
    
    2,973Total consumer installment loans
    
    
    56,099
    
    
    
    63,765Other loans
    
    
    5,829
    
    
    
    4,413Net deferred loan fees
    
    
    (1,361
    )
    
    
    (1,415
    )Total loans
    
    
    1,100,569
    
    
    
    1,115,261Less: Allowance for loan losses
    
    
    (21,010
    )
    
    
    (16,647
    )Net Loans
    
    $
    1,079,559
    
    
    
    1,098,614
  10




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##### Table of Contents



Nine Months EndedSeptember 30,2010
    
    
    2009(In Thousands)Balance, January 1, 2010 and 2009, respectively
    
    $
    16,647
    
    
    $
    12,138Add (deduct):Losses charged to allowance
    
    
    (6,001
    )
    
    
    (2,579
    )Recoveries credited to allowance
    
    
    196
    
    
    
    290Provision for loan losses
    
    
    10,168
    
    
    
    4,525Balance, September 30, 2010 and 2009, respectively
    
    $
    21,010
    
    
    $
    14,374
      11




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##### Table of Contents



Note 3. Debt and Equity Securities
  September 30, 2010Securities Available-For-SaleIn ThousandsGross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    MarketCost
    
    
    Gains
    
    
    Losses
    
    
    ValueU.S. Government and Federal
agencies
    
    $
    2,006
    
    
    $
    9
    
    
    $
    
    
    
    $
    2,015U.S. Government-sponsored
enterprises (GSEs)*
    
    
    188,162
    
    
    
    987
    
    
    
    442
    
    
    
    188,707Mortgage-backed:GSE residential
    
    
    81,975
    
    
    
    437
    
    
    
    160
    
    
    
    82,252Obligations of states and political
Subdivisions
    
    
    1,522
    
    
    
    125
    
    
    
    
    
    
    $
    1,647$
    273,665
    
    
    $
    1,558
    
    
    $
    602
    
    
    $
    274,621
 September 30, 2010Securities Held-To-MaturityIn ThousandsGross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    MarketCost
    
    
    Gains
    
    
    Losses
    
    
    ValueMortgage-backed:GSE residential
    
    $
    1,645
    
    
    $
    51
    
    
    $
    
    
    
    $
    1,696Obligations of states and political
Subdivisions
    
    
    11,339
    
    
    
    628
    
    
    
    
    
    
    
    11,967$
    12,984
    
    
    $
    679
    
    
    $
    
    
    
    $
    13,663
 *
    
    Such as Federal National Mortgage Association, Federal Home Loan Mortgage Corporation,
Federal Home Loan Banks, Federal Farm Credit Banks, and Government National Mortgage
Association.  12




---



##### Table of Contents



December 31, 2009Securities Available-For-SaleIn ThousandsGross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    MarketCost
    
    
    Gains
    
    
    Losses
    
    
    ValueU.S. Government and Federal
Agencies
    
    $
    1,000
    
    
    $
    5
    
    
    $
    
    
    
    $
    1,005U.S. Government-sponsored
enterprises (GSEs)*
    
    
    246,541
    
    
    
    636
    
    
    
    1,485
    
    
    
    245,692Mortgage-backed:GSE residential
    
    
    1,349
    
    
    
    37
    
    
    
    
    
    
    
    1,386Obligations of states and political
Subdivisions
    
    
    1,522
    
    
    
    42
    
    
    
    
    
    
    
    1,564$
    250,412
    
    
    $
    720
    
    
    $
    1,485
    
    
    $
    249,647
 December 31, 2009Securities Held-To-MaturityIn ThousandsGross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    MarketCost
    
    
    Gains
    
    
    Losses
    
    
    ValueMortgage-backed:GSE residential
    
    $
    14
    
    
    $
    
    
    
    $
    
    
    
    $
    14Obligations of states and political
Subdivisions
    
    
    12,156
    
    
    
    458
    
    
    
    20
    
    
    
    12,594$
    12,170
    
    
    $
    458
    
    
    $
    20
    
    
    $
    12,608
 *
    
    Such as Federal National Mortgage Association, Federal Home Loan Mortgage Corporation,
Federal Home Loan Banks, Federal Farm Credit Banks, and Government National Mortgage
Association.  In ThousandsEstimated
    
    
    
    
    
    
    EstimatedAmortized
    
    
    Market
    
    
    Amortized
    
    
    MarketCost
    
    
    Value
    
    
    Cost
    
    
    ValueHeld-to-Maturity
    
    
    Available for SaleDue in one year or less
    
    $
    1,352
    
    
    $
    1,373
    
    
    $
    5,059
    
    
    $
    5,111Due after one year
through five years
    
    
    4,749
    
    
    
    5,022
    
    
    
    95,637
    
    
    
    95,765Due after five years
through ten years
    
    
    3,295
    
    
    
    3,519
    
    
    
    122,489
    
    
    
    122,976Due after ten years
    
    
    3,588
    
    
    
    3,749
    
    
    
    50,480
    
    
    
    50,769$
    12,984
    
    
    $
    13,663
    
    
    $
    273,665
    
    
    $
    274,621
  13




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##### Table of Contents



In Thousands, Except Number of SecuritiesLess than 12 Months
    
    
    12 Months or More
    
    
    TotalNumber
    
    
    
    
    
    
    
    
    
    
    Numberof
    
    
    
    
    
    
    
    
    
    
    OfFair
    
    
    Unrealized
    
    
    Securities
    
    
    Fair
    
    
    Unrealized
    
    
    Securities
    
    
    Fair
    
    
    UnrealizedSeptember 30, 2010
    
    Value
    
    
    Losses
    
    
    Included
    
    
    Value
    
    
    Losses
    
    
    Included
    
    
    Value
    
    
    LossesHeld to Maturity Securities:Mortgage-backed:GSE residential
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    Obligations of states
and political
subdivisions
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    Available-for-Sale
Securities:U.S. Government and
Federal agencies
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    GSEs
    
    
    81,636
    
    
    
    442
    
    
    
    26
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    81,636
    
    
    
    442Mortgage-backed:GSE residential
    
    
    35,948
    
    
    
    160
    
    
    
    13
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    35,948
    
    
    
    160Obligations of states
and political
subdivisions
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    117,584
    
    
    $
    602
    
    
    
    39
    
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    117,584
    
    
    $
    602
 In Thousands, Except Number of SecuritiesLess than 12 Months
    
    
    12 Months or More
    
    
    TotalNumber
    
    
    
    
    
    
    
    
    
    
    NumberOf
    
    
    
    
    
    
    
    
    
    
    ofFair
    
    
    Unrealized
    
    
    Securities
    
    
    Fair
    
    
    Unrealized
    
    
    Securities
    
    
    Fair
    
    
    UnrealizedDecember 31, 2009
    
    Value
    
    
    Losses
    
    
    Included
    
    
    Value
    
    
    Losses
    
    
    Included
    
    
    Value
    
    
    LossesHeld to Maturity Securities:Mortgage-backed:GSE residential
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    Obligations of states and
political subdivisions
    
    
    599
    
    
    
    9
    
    
    
    2
    
    
    
    1,040
    
    
    
    11
    
    
    
    4
    
    
    
    1,639
    
    
    
    20$
    599
    
    
    $
    9
    
    
    
    2
    
    
    $
    1,040
    
    
    $
    11
    
    
    
    4
    
    
    $
    1,639
    
    
    $
    20Available-for-Sale Securities:U.S. Government and
Federal agencies
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    GSEs
    
    
    149,048
    
    
    
    1,401
    
    
    
    35
    
    
    
    2,906
    
    
    
    84
    
    
    
    1
    
    
    
    151,954
    
    
    
    1,485Mortgage-backed:GSE residential
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Obligations of states and
political subdivisions
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    149,048
    
    
    $
    1,401
    
    
    
    35
    
    
    $
    2,906
    
    
    $
    84
    
    
    
    1
    
    
    $
    151,954
    
    
    $
    1,485
  14




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##### Table of Contents



Note 4. Earnings Per Share
   Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2010
    
    
    2009
    
    
    2010
    
    
    2009(Dollars in Thousands
    
    
    (Dollars in ThousandsExcept Per Share Amounts)
    
    
    Except Per Share Amounts)Basic EPS Computation:Numerator  Earnings available to common
Stockholders
    
    $
    3,100
    
    
    $
    3,162
    
    
    $
    7,340
    
    
    $
    9,660Denominator  Weighted average number of
common shares outstanding
    
    
    7,212,205
    
    
    
    7,115,969
    
    
    
    7,189,827
    
    
    
    7,087,938Basic earnings per common share
    
    $
    .43
    
    
    $
    .44
    
    
    $
    1.02
    
    
    $
    1.36Diluted EPS Computation:Numerator  Earnings available to common
Stockholders
    
    $
    3,100
    
    
    $
    3,162
    
    
    $
    7,340
    
    
    $
    9,660Denominator  Weighted average number
of common shares outstanding
    
    
    7,212,205
    
    
    
    7,115,969
    
    
    
    7,189,827
    
    
    
    7,087,938Dilutive effect of stock options
    
    
    8,508
    
    
    
    21,019
    
    
    
    7,589
    
    
    
    20,2717,220,713
    
    
    
    7,136,988
    
    
    
    7,197,416
    
    
    
    7,108,209Diluted earnings per common share
    
    $
    .43
    
    
    $
    .44
    
    
    $
    1.02
    
    
    $
    1.36
  15




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##### Table of Contents



Note 5. Fair Value Measurements
  Valuation Hierarchy
  
 
 
  Assets
 Securities available for sale 
 Impaired loans 
  16




---



##### Table of Contents



Other real estate 
 Other assets
   Fair Value Measurements at September 30, 2010
 Carrying Value
    
    
    Quoted Prices inat
    
    
    Active Markets
    
    
    Significant Other
    
    
    SignificantSeptember 30,
    
    
    for Identical
    
    
    Observable
    
    
    Unobservable(in Thousands)
    
    2010
    
    
    Assets (Level 1)
    
    
    Inputs (Level 2)
    
    
    Inputs (Level 3)Assets:Available-for-sale
securities
    
    $
    274,621
    
    
    $
    2,015
    
    
    $
    272,606
    
    
    $
    Cash surrender
value of life
insurance
    
    
    1,552
    
    
    
    
    
    
    
    
    
    
    
    1,552
  Fair Value Measurements at September 30, 2010
 Carrying Value
    
    
    Quoted Prices inat
    
    
    Active Markets
    
    
    Significant Other
    
    
    SignificantSeptember 30,
    
    
    for Identical
    
    
    Observable
    
    
    Unobservable(in Thousands)
    
    2010
    
    
    Assets (Level 1)
    
    
    Inputs (Level 2)
    
    
    Inputs (Level 3)Assets:Impaired loans
    
    $
    58,693
    
    
    $
    
    
    
    $
    
    
    
    $
    58,693Other real estate
    
    
    11,666
    
    
    
    
    
    
    
    
    
    
    
    11,666Repossesed assets
    
    
    9
    
    
    
    
    
    
    
    
    
    
    
    9
  17




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##### Table of Contents



Changes in level 3 fair value measurements
  (in thousands)
 Assets
    
    
    LiabilitiesFair Value, January 1, 2010
    
    $
    1,497
    
    
    $
    Total realized gains included in income
    
    
    55
    
    
    
    Purchases, issuances and settlements, net
    
    
    
    
    
    
    Transfers in and/or (out) of Level 3
    
    
    
    
    
    
    Fair Value, September 30, 2010
    
    $
    1,552
    
    
    $
    Total realized gains included in income related
to financial assets and liabilities still on the
consolidated balance sheet at September 30, 2010
    
    $
    55
    
    
    $
    
  Cash, Due From Banks and Federal Funds Sold
 Securities held to maturity
 Loans
 Mortgage loans held-for-sale
 Deposits, Securities Sold Under Agreements to Repurchase, Federal Home Loan Bank Advances
  18




---



##### Table of Contents



In ThousandsSeptember 30, 2010
    
    
    December 31, 2009Carrying
    
    
    
    
    
    
    CarryingAmount
    
    
    Fair Value
    
    
    Amount
    
    
    Fair ValueFinancial assets:Cash and short-term
investments
    
    $
    49,045
    
    
    
    49,045
    
    
    $
    31,512
    
    
    
    31,512Securities available-for-sale
    
    
    274,621
    
    
    
    274,621
    
    
    
    249,647
    
    
    
    249,647Securities, held to maturity
    
    
    12,984
    
    
    
    13,663
    
    
    
    12,170
    
    
    
    12,608Loans, net of unearned
interest
    
    
    1,100,569
    
    
    
    
    
    
    
    1,115,261Less: allowance for loan
Losses
    
    
    21,010
    
    
    
    
    
    
    
    16,647Loans, net of allowance
    
    
    1,079,559
    
    
    
    1,079,020
    
    
    
    1,098,614
    
    
    
    1,100,515Loans held for sale
    
    
    13,583
    
    
    
    13,583
    
    
    
    5,027
    
    
    
    5,027Restricted equity securities
    
    
    3,012
    
    
    
    3,012
    
    
    
    3,012
    
    
    
    3,012Accrued interest receivable
    
    
    6,656
    
    
    
    6,656
    
    
    
    7,563
    
    
    
    7,563Cash surrender value of life
insurance
    
    
    1,552
    
    
    
    1,552
    
    
    
    1,497
    
    
    
    1,497Financial liabilities:Deposits
    
    
    1,344,480
    
    
    
    1,354,530
    
    
    
    1,310,706
    
    
    
    1,316,097Securities sold
under repurchase
agreements
    
    
    6,228
    
    
    
    6,228
    
    
    
    6,499
    
    
    
    6,499Advances from Federal Home
Loan Bank
    
    
    
    
    
    
    
    
    
    
    13
    
    
    
    13Accrued interest payable
    
    
    3,809
    
    
    
    3,809
    
    
    
    4,923
    
    
    
    4,923Unrecognized financial
instruments:Commitments to extend
credit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Standby letters of credit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
  19




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##### Table of Contents



Note 6. Stock Options
    September 30, 2010WeightedAverageExerciseShares
    
    
    PriceOutstanding at
January 1, 2010
    
    
    41,370
    
    
    $
    24.73Granted
    
    
    19,250
    
    
    
    37.75Exercised
    
    
    (3,644
    )
    
    
    20.90Forfeited or expired
    
    
    (2,202
    )
    
    
    25.77Outstanding at
September 30, 2010
    
    
    54,774
    
    
    $
    29.52Options exercisable
September 30, 2010
    
    
    11,447
    
    
    $
    21.82
  20




---



##### Table of Contents



The following table summarizes information about fixed stock options outstanding at
September 30, 2010:
 Weighted
    
    
    
    
    
    
    
    
    
    
    WeightedWeighted
    
    
    Average
    
    
    
    
    
    
    Weighted
    
    
    AverageRange of
    
    Number
    
    
    Average
    
    
    Remaining
    
    
    Number
    
    
    Average
    
    
    RemainingExercise
    
    Outstanding
    
    
    Exercise
    
    
    Contractual
    
    
    Exercisable
    
    
    Remaining
    
    
    ContractualPrices
    
    at 9/30/10
    
    
    Price
    
    
    Term
    
    
    at 9/30/10
    
    
    Price
    
    
    Term$11.46 
$17.19
    
    
    9,093
    
    
    $
    15.99
    
    
    1.8 years
    
    
    
    5,022
    
    
    $
    16.05
    
    
    1.9 years$17.20 
$25.79
    
    
    9,889
    
    
    $
    22.60
    
    
    4.0 years
    
    
    
    3,414
    
    
    $
    22.99
    
    
    4.1 years$25.80 
$35.75
    
    
    16,542
    
    
    $
    31.52
    
    
    6.8 years
    
    
    
    3,011
    
    
    $
    30.13
    
    
    6.4 years$35.76 
$37.75
    
    
    19,250
    
    
    $
    37.75
    
    
    9.3 years
    
    
    
    
    
    
    $
    
    
    
    
    55,774
    
    
    
    
    
    
    
    
    
    
    
    11,447Aggregate
intrinsic value
(in thousands)
    
    $
    505
    
    
    
    
    
    
    
    
    
    
    $
    194
   
 Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of
Operations
  Forward-Looking Statements
   21




---



##### Table of Contents



Critical Accounting Estimates
  Allowance for Loan Losses (allowance).
   22




---



##### Table of Contents



Impairment of Intangible Assets 
  23




---



##### Table of Contents



Results of Operations
  Net Interest Income
   24




---



##### Table of Contents



Provision for Loan Losses
   Non-Interest Income
   25




---



##### Table of Contents



Non-Interest Expenses
  Income Taxes
  Financial Condition
 Balance Sheet Summary
   26




---



##### Table of Contents



Non Performing Assets
  September 30, 2010
    
    
    December 31, 2009Past Due
    
    
    
    
    
    
    Past Due90 Days
    
    
    Non-Accrual
    
    
    90 Days
    
    
    Non-Accrual(In Thousands)
    
    
    (In Thousands)Commercial, financial,
and
agriculture
    
    $
    42
    
    
    
    495
    
    
    $
    1,291
    
    
    
    100Real estate-construction
    
    
    381
    
    
    
    8,534
    
    
    
    29
    
    
    
    5,636Real estate-mortgage
    
    
    2,301
    
    
    
    15,725
    
    
    
    2,435
    
    
    
    19,750Consumer
    
    
    89
    
    
    
    20
    
    
    
    314
    
    
    
    28$
    2,813
    
    
    
    24,774
    
    
    $
    4,069
    
    
    
    25,514
    27




---



##### Table of Contents



(In Thousands)
    
    September 30, 2010
    
    
    December 31, 2009Impaired loans without a
valuation
allowance
    
    $
    25,706
    
    
    
    23,982Impaired loans with a valuation
allowance
    
    
    40,962
    
    
    
    21,770Total impaired loans
    
    $
    66,668
    
    
    
    45,752Valuation allowances related to
impaired loans
    
    $
    7,975
    
    
    
    5,260Total non-accrual loans
    
    $
    24,774
    
    
    
    25,514Total loans past due
90 days or more and
still accruing
    
    $
    2,813
    
    
    
    4,069
     September 302010(In Thousands)SpecialTotal
    
    
    Mention
    
    
    Substandard
    
    
    DoubtfulCommercial, financial and
agricultural
    
    $
    1,410
    
    
    
    207
    
    
    
    1,203
    
    
    
    Real estate mortgage
    
    
    66,831
    
    
    
    18,994
    
    
    
    47,837
    
    
    
    Real estate construction
    
    
    597
    
    
    
    389
    
    
    
    208
    
    
    
    Consumer
    
    
    605
    
    
    
    162
    
    
    
    443
    
    
    
    $
    69,443
    
    
    
    19,752
    
    
    
    49,691
    
    
    
    
  28




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##### Table of Contents



December 31,2009(In Thousands)SpecialTotal
    
    
    Mention
    
    
    Substandard
    
    
    DoubtfulCommercial, financial and
agricultural
    
    $
    3,622
    
    
    
    2,821
    
    
    
    801
    
    
    
    Real estate mortgage
    
    
    57,901
    
    
    
    10,998
    
    
    
    46,903
    
    
    
    Real estate construction
    
    
    273
    
    
    
    273
    
    
    
    
    
    
    
    Consumer
    
    
    904
    
    
    
    266
    
    
    
    638
    
    
    
    $
    62,700
    
    
    
    14,358
    
    
    
    48,342
    
    
    
    
    September 30, 2010
    
    
    December 31, 2009Percent of
    
    
    
    
    
    
    Percent ofLoans In
    
    
    
    
    
    
    Loans InIn
    
    
    Each Category
    
    
    In
    
    
    Each CategoryThousands
    
    
    To Total Loans
    
    
    Thousands
    
    
    To Total LoansCommercial, financial and
agricultural
    
    $
    1,142
    
    
    
    5.2
    %
    
    $
    1,593
    
    
    
    7.4
    %Real estate construction
    
    
    3,493
    
    
    
    16.5
    
    
    
    3,412
    
    
    
    17.8Real estate mortgage
    
    
    15,264
    
    
    
    72.7
    
    
    
    10,252
    
    
    
    69.1Installment
    
    
    1,111
    
    
    
    5.6
    
    
    
    1,390
    
    
    
    5.7$
    21,010
    
    
    
    100.0
    %
    
    $
    16,647
    
    
    
    100.0
    %
  29




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##### Table of Contents



Liquidity and Asset Management
          30




---



##### Table of Contents



Off Balance Sheet Arrangements
  Capital Position and Dividends
      31




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##### Table of Contents



Minimum To Be WellCapitalized UnderMinimum Capital
    
    
    Prompt CorrectiveActual
    
    
    Requirement
    
    
    Action ProvisionAmount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio(dollars in thousands)September 30, 2010:Total capital to risk
weighted assets:Consolidated
    
    $
    154,897
    
    
    
    13.6
    %
    
    $
    91,116
    
    
    
    8.0
    %
    
    
    N/A
    
    
    
    N/AWilson Bank
    
    
    151,583
    
    
    
    13.3
    
    
    
    91,177
    
    
    
    8.0
    
    
    $
    113,972
    
    
    
    10.0
    %Tier 1 capital to risk
weighted assets:Consolidated
    
    
    140,575
    
    
    
    12.4
    
    
    
    45,346
    
    
    
    4.0
    
    
    
    N/A
    
    
    
    N/AWilson Bank
    
    
    137,306
    
    
    
    12.1
    
    
    
    45,390
    
    
    
    4.0
    
    
    
    68,086
    
    
    
    6.0Tier 1 capital to
average assets:Consolidated
    
    
    140,575
    
    
    
    9.4
    
    
    
    59,819
    
    
    
    4.0
    
    
    
    N/A
    
    
    
    N/AWilson Bank
    
    
    137,306
    
    
    
    9.2
    
    
    
    59,698
    
    
    
    4.0
    
    
    
    74,623
    
    
    
    5.0
 Minimum To Be WellCapitalized UnderMinimum Capital
    
    
    Prompt CorrectiveActual
    
    
    Requirement
    
    
    Action ProvisionAmount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio(dollars in thousands)December 31, 2009:Total capital to risk
weighted assets:Consolidated
    
    $
    148,856
    
    
    
    12.8
    %
    
    $
    93,035
    
    
    
    8.0
    %
    
    
    N/A
    
    
    
    N/AWilson Bank
    
    
    148,518
    
    
    
    12.8
    
    
    
    92,824
    
    
    
    8.0
    
    
    $
    116,030
    
    
    
    10.0
    %Tier 1 capital to risk
weighted assets:Consolidated
    
    
    134,320
    
    
    
    11.6
    
    
    
    46,317
    
    
    
    4.0
    
    
    
    N/A
    
    
    
    N/AWilson Bank
    
    
    133,982
    
    
    
    11.5
    
    
    
    46,602
    
    
    
    4.0
    
    
    
    69,904
    
    
    
    6.0Tier 1 capital to
average assets:Consolidated
    
    
    134,320
    
    
    
    9.3
    
    
    
    57,772
    
    
    
    4.0
    
    
    
    N/A
    
    
    
    N/AWilson Bank
    
    
    133,982
    
    
    
    9.3
    
    
    
    57,627
    
    
    
    4.0
    
    
    
    72,033
    
    
    
    5.0
  32




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##### Table of Contents



Impact of Inflation
  
 Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
     33




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##### Table of Contents



Item 4. Controls and Procedures
    34




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##### Table of Contents



PART II. OTHER INFORMATION
 
 Item 1.
    
    LEGAL PROCEEDINGS
  
 Item 1A.
    
    RISK FACTORS
  
 Item 2.
    
    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
 (a)
    
    None
 (b)
    
    Not applicable
 (c)
    
    None
 
 Item 3.
    
    DEFAULTS UPON SENIOR SECURITIES
 (a)
    
    None
 (b)
    
    Not applicable
 
 Item 4.
    
    (REMOVED AND RESERVED)
 
 Item 5.
    
    OTHER INFORMATION
   35




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##### Table of Contents



Item 6.
    
    EXHIBITS
 31.1
    
    
    Certification of the Chief Executive Officer Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of the Chief Financial Officer Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification of the Chief Executive Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification of the Chief Financial Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
 
  36




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##### Table of Contents



SIGNATURES
  WILSON BANK HOLDING COMPANY
(Registrant)DATE: November 9, 2010
    /s/ Randall ClemonsRandall ClemonsPresident and Chief Executive OfficerDATE: November 9, 2010
    /s/ Lisa PominskiLisa PominskiSenior Vice President & Chief Financial Officer  37