Commercial National Reports March 31, 2023 Results

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LATROBE, PA / ACCESSWIRE / April 28, 2023 / Commercial National Financial Corporation (OTC Markets:CNAF)(Company), parent Company of Commercial Bank & Trust of PA, has reported results for the quarter ended March 31, 2023. The Company earned $845,000 (or $0.30 per average share outstanding) in the first quarter 2023 compared to $973,000 (or $0.34 per average share outstanding) in the first quarter of 2022. Tier one risk-based, total risk-based, leverage and common equity tier one capital ratios at March 31, 2023 were 23.12%, 23.74%, 13.14% and 23.12% respectively. Tier one capital was $57,499,000 and total risk-based capital was $59,034,000 while book capital reflected a temporary after-tax accumulated other comprehensive loss stemming from net unrealized securities available-for-sale market value depreciation. As with many other insured depository institutions nation-wide, the Company’s securities portfolio has been adversely impacted by rising interest rates. Fully insured well diversified core deposits comprised over 85% of total deposits at first quarter-end 2023 which favorably compares to national banking industry metrics.

Direct and beneficial ownership by executive officers and directors of the Company’s outstanding shares totaled 489,660 shares, or 17.12% on March 31, 2023.

As disclosed each year in the Annual Report to Shareholders, on March 31, 2023, the Company employed 80 people in full-time and part-time positions. Thirty-three (33) employees are represented by the United Auto Workers, Local 1799. Of that bargaining unit total, thirty (30) employees are full-time and there are three (3) part-time employees. The Company has had unionized employees since 1972. In October 2018, the agreement between the Company and the bargaining unit was negotiated and subsequently ratified by the bargaining unit with an effective date of February 16, 2019. The labor agreement will expire in February 2024. The Commonwealth of Pennsylvania and the National Labor Relations Board both afford protection to the organized status of pre-existing collective bargaining units. The Company has been advised that bargaining unit status limits the Company’s strategic options relative to those of non-unionized insured depository institutions. The Company continues to consider this as a factor in its strategic and capital management decisions.

The Company operates seven community banking facilities in Hempfield Township, Latrobe, Ligonier, Unity Township and West Newton, Pennsylvania and also maintains a commercial business development sales force throughout its entire market area. The Company operates an asset management and trust division of Commercial Bank & Trust of PA headquartered in Greensburg, Pennsylvania. Commercial Bank & Trust of PA also serves its customer base from an Internet banking site (www.cnbthebankonline.com) and an automated TouchTone Teller banking system.

Safe Harbor Statement

Forward-looking statements (statements which are not historical facts) in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as “may,” “will,” “to,” “expect,” “believe,” “anticipate,” “intend,” “could,” “would,” “estimate,” or “continue” or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements. These statements are based on information currently available to the Company, and the Company assumes no obligation to update these statements as circumstances change. Investors are cautioned that all forward-looking statements involve risk and uncertainties, including changes in general economic and financial market conditions, unforeseen credit problems, and the Company’s ability to execute its business plans. The actual results of future events could differ materially from those stated in any forward-looking statements herein.

COMMERCIAL NATIONAL FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Unaudited)
(Dollars in thousands, except per share data)

	March 31,			December 31			March 31,
	2023			2022			2022

ASSETS
Cash and due from banks on demand	$	4,306		$	5,177		$	4,164
Interest bearing deposits with banks		1,068			1,158			3,776
Cash and Cash Equivalents		5,374			6,335			7,940

Securities available for sale		174,661			170,268			195,746
Restricted investments in bank stock		1,018			630			301

Loans		198,466			201,423			214,423
Allowance for loan losses		(1,535	)		(1,535	)		(2,115	)
Net loans		196,931			199,888			212,308

Premises and equipment		2,535			2,517			2,591
Accrued Interest receivable		2,672			2,203
Investment in life insurance		18,121			17,987			17,788
Other Real Estate Owned		–			–			3,335
Other Assets		7,390			8,546			6,129

Total assets	$	408,702		$	408,374		$	446,138

LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities
Deposits
Non-interest bearing	$	163,477		$	165,551		$	167,713
Interest bearing		187,481			201,914			222,041
Total deposits		350,958			367,465			389,754

Short-term borrowings		20,076			6,715			4,063
Other liabilities		1,561			1,736			1,694
Total liabilities		372,595			375,916			395,511

Shareholders’ equity
Common stock, par value $2 per share;
10,000,000 shares authorized; 3,600,000
shares issued; 2,860,953 shares
outstanding in 2023 and 2022		7,200			7,200			7,200
Retained earnings		63,174			63,073			62,370
Accumulated other comprehensive income		(21,723	)		(25,271	)		(6,399	)
Treasury stock, at cost, 739,047 shares
in 2023 and 2022		(12,544	)		(12,544	)		(12,544	)
Total shareholders’ equity		36,107			32,458			50,627

Total liabilities and shareholders’ equity	$	408,702		$	408,374		$	446,138

COMMERCIAL NATIONAL FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Dollars in thousands, except per share data)

	Three Months Ended		Three Months Ended
	March 31,		March 31,
	2023		2022

INTEREST INCOME
Interest and fees on loans	$	2,054	$	2,123
Interest and dividends on securities:
Taxable		1,175		1,174
Exempt from federal income taxes		518		507
Other		30		8
Total Interest income		3,777		3,812

INTEREST EXPENSE
Interest on deposits		38		56
Interest on short-term borrowings		215		–
Total Interest expense		253		56

NET INTEREST INCOME		3,524		3,756
PROVISION FOR LOAN LOSSES		–		14

NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES		3,524		3,742

OTHER OPERATING INCOME
Asset management and trust income		337		375
Service charges on deposit accounts		156		152
Net Security gains		–		13
Income from investment in life insurance		126		123
Other income		50		60
Total other operating income		669		723

OTHER OPERATING EXPENSES
Salaries and employee benefits		1,896		1,885
Net occupancy expense		214		204
Furniture and equipment		126		113
Pennsylvania shares tax		73		159
Legal and professional		126		111
FDIC Insurance		31		24
Other expenses		822		911
Total other operating expenses		3,288		3,407

INCOME BEFORE INCOME TAXES		905		1,058
Income tax expense		60		85

Net income	$	845	$	973

Average Shares Outstanding		2,860,953		2,860,953

Earnings Per Share	$	0.30	$	0.34