Commercial National Reports March 31, 2019 Earnings Increase Of 16.15%

LATROBE, PA / ACCESSWIRE / April 24, 2019 / Commercial National Financial Corporation (OTCQX: CNAF) (Company), parent Company of Commercial Bank & Trust of PA, has reported results for the quarter ended March 31, 2019. The Company earned $1,208,,000 (or $0.42 per average share outstanding) in the first quarter 2019 compared to $1,040,000 (or $0.36 per average share outstanding) in the first quarter of 2018.

First quarter 2019 earnings increased $168,000, or 16.15%, over first quarter 2018 results due to core earnings growth. The Company’s annualized return on average assets for the quarter ended March 31, 2019 was 1.15%, compared to 1.08% for the quarter ended March 31, 2018. First quarter tax equivalent net interest margin was 4.09%. Asset credit quality metrics continue to be outstanding relative to prevailing banking industry norms. The effective tax rate for the quarter ended March 31, 2019 was 6.65%. Tier one risk-based, total risk-based, leverage and common equity tier one capital ratios for March 31, 2019 were 22.16%, 22.68%, 13.93% and 22.16%, respectively.

The Company’s strong capital position, supplemented by recent and reasonably anticipated core earnings, remains supportive of the regular $0.26 quarterly common stock cash dividend payments to shareholders. Providing an attractive and reliable cash dividend income stream to all our shareholders through the safe and sound operation of the subsidiary bank is a long-standing top priority for the Company.

Direct and beneficial ownership by executive officers and directors of the Company’s outstanding shares totaled 472,975 shares, or 16.53% on March 31, 2019.

As disclosed each year in the Annual Report to Shareholders, on March 31, 2019, the Company employed 97 people in full-time and part-time positions. Forty-five (45) employees are represented by the United Auto Workers, Local 1799. Of that bargaining unit total, Thirty-five (35) employees are full-time and ten (10) employees are part-time. 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 may limit 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 nine community banking facilities in Greensburg, Hempfield Township, Latrobe, Ligonier, North Huntingdon, 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.cbthebank.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.

Contact Information:

Wendy S. Piper
First Senior Vice President
Secretary/Treasurer
[email protected]

724-537-9923

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

March 31,
December 31,
March 31,
2019
2018
2018
ASSETS
Cash and due from banks on demand
$ 5,068 $ 5,642 $ 3,163
Interest bearing deposits with banks
103 59 44
Cash and Cash Equivalents
5,171 5,701 3,207
Securities available for sale
160,841 159,741 153,582
Restricted investments in bank stock
1,558 1,411 894
Loans
228,167 227,747 206,969
Allowance for loan losses
(1,340 ) (1,349 ) (1,289 )
Net loans
226,827 226,398 205,680
Premises and equipment
2,713 2,800 2,919
Investment in life insurance
19,901 19,767 19,365
Other assets
4,679 3,808 4,606
Total assets
$ 421,690 $ 419,626 $ 390,253
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities
Deposits
Non-interest bearing
$ 128,131 $ 128,437 $ 120,765
Interest bearing
193,786 197,482 194,828
Total deposits
321,917 325,919 315,593
Short-term borrowings
35,512 32,822 15,265
Other liabilities
1,912 1,351 876
Total liabilities
359,341 360,092 331,734
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 2019 and 2018
7,200 7,200 7,200
Retained earnings
63,549 63,085 62,011
Accumulated other comprehensive income
4,144 1,793 1,852
Treasury stock, at cost, 739,047 shares
in 2019 and 2018
(12,544 ) (12,544 ) (12,544 )
Total shareholders’ equity
62,349 59,534 58,519
Total liabilities and shareholders’ equity
$ 421,690 $ 419,626 $ 390,253

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,
2019
2018
INTEREST INCOME
Interest and fees on loans
$ 2,591 $ 2,230
Interest and dividends on securities:
Taxable
1,051 1,039
Exempt from federal income taxes
559 468
Other
34 12
Total Interest income
4,235 3,749
INTEREST EXPENSE
Interest on deposits
187 101
Interest on short term borrowings
252 57
Total Interest expense
439 158
NET INTEREST INCOME
3,796 3,591
PROVISION FOR LOAN LOSSES
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES
3,796 3,591
OTHER OPERATING INCOME
Asset management and trust income
340 356
Service charges on deposit accounts
169 177
Net Security losses
(3 )
Gain on sale of OREO
4
Income from investment in life insurance
126 127
Other income
64 79
Total other operating income
700 739
OTHER OPERATING EXPENSES
Salaries and employee benefits
1,867 1,830
Net occupancy expense
218 217
Furniture and equipment
106 122
Pennsylvania shares tax
142 128
Legal and professional
78 120
FDIC Insurance
28 29
Other expenses
763 723
Total other operating expenses
3,202 3,169
INCOME BEFORE INCOME TAXES
1,294 1,161
Income tax expense
86 121
Net income
$ 1,208 $ 1,040
Average Shares Outstanding
2,860,953 2,860,953
Earnings Per Share
$ 0.42 $ 0.36

SOURCE: Commercial National Financial Corporation

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