form11k.htm
 
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549


FORM 11-K


 [X] Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of 1934
For the fiscal year ended December 31, 2007
or

[  ] Transition Report Pursuant to Section 15(d) of the Securities Exchange Act of 1934
For the transition period from  __________ to __________.

Commission File Number 0-11733

A.  Full title of the plan and the address of the plan, if different from that of the issuer named below:

CITY HOLDING COMPANY
401(k) Plan and Trust

B.  Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:

City Holding Company
25 Gatewater Road
Charleston, West Virginia  25313




 
 
 

City Holding Company
401(k) Plan and Trust

Form 11-K

Year Ended December 31, 2007


Required Information
 
The City Holding Company 401(k) Plan and Trust (the Plan) is subject to the Employee Retirement Income Security Act of 1974 (ERISA), as amended. Accordingly, in lieu of the requirements of Items 1-3 of this section, the Plan is filing financial statements and supplemental schedules prepared in accordance with the financial reporting requirements of ERISA. The following financial statements and supplemental schedules, attached hereto, are filed as part of the Annual Report:
 
        Report of Independent Registered Public Accounting Firm
1
        Statements of Net Assets Available for Benefits
2
        Statement of Changes in Net Assets Available for Benefits
3
        Notes to Financial Statements
4 -7
        Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
8

 
    Item 9(b) - Exhibits:
  
        Exhibit 23 - Consent of Independent Registered Public Accounting Firm
  


 
 
 





Report of Independent Registered Public Accounting Firm

Board of Directors
City Holding Company
 
We have audited the accompanying statements of net assets available for benefits of the City Holding Company 401(k) Plan and Trust (the Plan) as of December 31, 2007 and 2006, and the related statement of changes in net assets available for benefits for the year ended December 31, 2007. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
 
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Plan is not required, nor were we were not engaged to, perform an audit of the Plan's internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan's internal control over financial reporting. Accordingly, we express no such opinion.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
 
In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 2007 and 2006, and the changes in its net assets available for benefits for the year ended December 31, 2007, in conformity with U.S. generally accepted accounting principles.
 
Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental Schedule of Assets (Held at End of Year) as of December 31, 2007, is presented for purposes of additional analysis and is not a required part of the financial statements but is supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. This supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole.
 
/s/  Gibbons & Kawash
Charleston, WV

June 25, 2008
 
 
401(k) Plan and Trust
  
             
Statements of Net Assets Available for Benefits
  
             
             
   
December 31
  
   
2007
    
2006
  
Assets
            
Investments at fair value:
            
Mutual and commingled funds
   $ 21,730,805     $ 21,503,615  
Common stock of City Holding Company
     12,725,422       15,233,482  
Participant loans
     1,377,862       1,110,849  
                 
Net assets available for benefits
   $ 35,834,089     $ 37,847,946  
                 
The accompanying notes are an integral part of these financial statements.
          
 
 
-2-
 
 
401(k) Plan and Trust
  
       
Statement of Changes in Net Assets Available for Benefits
  
       
Year Ended December 31, 2007
  
       
       
Additions
      
Investment income:
      
Interest and dividends
   $ 550,317  
      550,317  
         
Contributions:
        
Contributions from employer
     627,935  
Contributions from employees
     1,718,432  
      2,346,367  
Total additions
     2,896,684  
         
Deductions
        
Net depreciation in fair value of investments
     803,831  
Withdrawals and benefits paid directly to participants
     4,088,560  
Administrative expenses
     18,150  
Total payments and expenses
     4,910,541  
         
Net decrease
     (2,013,857 )
         
Net assets available for benefits:
        
Beginning of year
     37,847,946  
End of year
   $ 35,834,089  
         
The accompanying notes are an integral part of these financial statements.
        
 

 
 
-3-
 
CITY HOLDING COMPANY 401(K) PLAN AND TRUST

Notes to Financial Statements


1. Significant Accounting Policies
 
Basis of Accounting
 
The accounting records of the City Holding Company 401(k) Plan and Trust (the Plan) are maintained on the accrual basis of accounting.
 
Use of Estimates
 
The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates.
 
Cash and Cash Equivalents
 
Cash equivalents are short-term, highly liquid investments. The market value of cash equivalents approximates cost.
 
Investments
 
The Plan determines the fair value of its investment in City Holding Company common stock based on the stock’s quoted trade price. Investments in mutual and commingled funds are valued at the Plan’s proportionate share of the quoted fair value of net assets in each fund as of December 31, 2007 and 2006.  During 2006, the Plan adopted Financial Accounting Standards Board Staff Position FSP AAG INV-1 and SOP 94-4-1, “Reporting of Fully Benefit-Responsive Investment Contracts Held by Certain Investment Companies Subject to the AICPA Investment Company Guide and Defined-Contribution Health and Welfare and Pension Plans” (the FSP).  The FSP requires that certain investment contracts held by a defined-contribution plan, which were previously presented at contract value, are required to be reported at fair value.  The adoption of this FSP did not have a material impact on the Plan’s financial statements as the contract values of the investments in such investment contracts approximate fair value.
 
The participant loans are valued at their outstanding balances, which approximate fair value.
 
Each participant may designate the percentage of his or her contributions to be invested into any of the investment options, offered by the Plan.
 
Risks and Uncertainties
 
The Plan invests in various investment securities.  Investment securities are exposed to various risks such as interest rate, market and credit risks.  Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants' account balances and the amounts reported in the statements of net assets available for benefits.
 
-4-

 
CITY HOLDING COMPANY 401(K) PLAN AND TRUST
 
 
Notes to Financial Statements
 
 
2. Description of Plan
 
The following description of the Plan provides general only information. Participants should refer to the Summary Plan Description for a complete description of the Plan’s provisions.
 
General
 
The Plan is a defined contribution savings plan covering all employees of City Holding Company and its subsidiaries (the Company) who are eligible for participation in the plan the first day of the month subsequent to date of hire or attaining the age of 21. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
 
Contributions
 
The Company’s contribution consists of a 50% match of the first 6% of each eligible participant’s contribution as directed by the participant's investment elections. If a participant does not elect investment options, all contributions are invested in the default fund, as defined in the Plan agreement.
 
Participant Accounts
 
Participants may elect to contribute, on a salary-deferral basis, up to 15% of annual compensation, subject to federal income tax limits. Included in participant contributions are approximately $81,000 and $578,000 in 2007 and 2006, respectively, of participant account balances rolled-over from previous employer plans. Participants may elect, on an annual basis, to have the dividends on their investment in Plan sponsor stock to be paid directly to the participant or reinvested in the participant’s account in the Plan sponsor stock.
 
Vesting
 
Participants are immediately vested in all contributions, the employer match, and earnings thereon when they are made to the Plan.
 

 
-5-
 
CITY HOLDING COMPANY 401(K) PLAN AND TRUST

Notes to Financial Statements


2. Description of Plan (continued)
 
Participant Loans
 
Participants may borrow from their fund accounts a minimum of $1,000 up to a maximum of equal to the lesser of $50,000 or 50% of their account balance. Loan terms range from 1-5 years or for a reasonable time period if for the purchase of a primary residence. The loans are secured by the balance in the participant’s account and bear interest at a reasonable rate. Participant assets are utilized to pay administrative fees associated with processing participant loans. Principal and interest is paid ratably through semi-monthly payroll deductions.
 
Payment of Benefits
 
Benefits, representing each participant’s share in the Plan, are generally payable upon the participating employee’s death, retirement, disability, or separation from the Company. Benefits are payable in the form of cash, stock, or a combination thereof.
 
Plan Termination
 
Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the plan subject to the provisions of ERISA.
 
3. Federal Income Taxes
 
The Plan has received a determination letter from the Internal Revenue Service dated May 6, 2004, stating that the Plan is qualified under Section 401(a) of the Internal Revenue Code (the Code) and, therefore, the related trust is exempt from taxation. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualification. The plan administrator believes the Plan is being operated in compliance with the applicable requirements of the Code and, therefore, believes that the Plan, as amended, is qualified and the related trust is tax-exempt.
 

 
-6-
 
CITY HOLDING COMPANY 401(K) PLAN AND TRUST

Notes to Financial Statements


4. Related Party Transactions
 
The Company provides certain accounting and administrative services to the Plan without charge. The Company also pays certain administrative costs on behalf of the Plan, including legal and accounting fees.
 
City National Bank of West Virginia, a subsidiary of the Company, is the trustee of the Plan’s assets.
 
5. Investments
 
During 2007, the Plan’s investments (including investments purchased and sold as well as those held during the year) appreciated in fair value as determined by quoted market prices as follows:
 
   
Net Realized
  
   
and Unrealized
  
   
(Depreciation) in Fair
  
   
Value of Investments
  
       
Mutual and commingled funds
   $ 1,681,495  
Common stock
     (2,485,326 )
Total
   $ (803,831 )

The fair values of individual investments that represent 5% or more of the Plan’s net assets are as follows:
 
       
December 31
  
       
2007
    
2006
  
                 
  *  
City Holding Company common stock
   $ 12,725,422     $ 15,233,482  
     
Federated Capital Preservation Fund
     7,462,792       8,918,923  
     
American Funds American Balanced Fund
     2,834,724       2,520,913  
     
Federated Capital Appreciation Fund
     2,206,328       1,932,324  
     
American Funds EuroPacific fund
     2,008,620       1,436,991  
     
Federated Kaufman Fund
     2,073,729       1,186,334  
                       
  *  
Party-in-interest
  

 
-7-
 
   
City Holding Company
  
   
401(k) Plan and Trust
  
                   
   
Plan: 002 EIN: 550619957
  
                   
   
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
  
                   
   
December 31, 2007
  
                   
   
(b)
  
(c)
  
(e)
  
   
Identity of Issue, Borrower,
  
Description of
  
Current
  
(a)
  
Lessor, or Similar Party
  
Investment
  
Value
  
                   
   
Common stock:
              
  *  
City Holding Company common stock
     376,047  
Shares
   $ 12,725,422  
                         
     
Investments in mutual or commingled funds:
                  
     
Federated Capital Appreciation Fund
     103,389  
Units
     2,206,328  
     
Federated Capital Preservation Fund
     746,279  
Units
     7,462,792  
     
Federated Kaufmann Fund
     332,862  
Units
     2,073,729  
     
Federated Short-Term Income Fund
     108,235  
Units
     904,847  
     
Federated Max-Cap Index Fund
     38,589  
Units
     909,551  
     
Federated Stock Trust Fund
     25,973  
Units
     682,840  
     
Federated Total Return Bond Fund
     36,321  
Units
     388,634  
     
American Funds American Balanced Fund
     147,029  
Units
     2,834,724  
     
American Funds EuroPacific Growth Fund
     40,044  
Units
     2,008,620  
     
American Funds Washington Mutual Investor Fund
     7,726  
Units
     259,134  
     
American Funds AMCAP Fund
     19,149  
Units
     384,513  
     
Alger Large Cap Growth Institutional Fund
     26,684  
Units
     436,019  
     
Baron Small Cap Fund
     49,479  
Units
     1,179,076  
                      21,730,805  
                         
     
Participant loans
  
Interest at 5.00%-9.25%,
  
         
maturing through
        
         
May 2018
         1,377,862  
                         
     
Total
             $ 35,834,089  
                         
Column (d), cost, has been omitted, as investments are participant-directed.
            
  *  
Indicates a party-in-interest to the Plan.
                  

 
 
-8-
 
 

Pursuant to the requirements of the Securities and Exchange Act of 1934, City Holding Company has duly caused this annual report to be signed by the undersigned thereunto duly authorized.
 


City Holding Company
401(k) Plan and Trust



/s/ Craig G. Stilwell
Craig G. Stilwell
Plan Administrator




June 25, 2008


 
-9-