Commercial National Reports June 30, 2013 Results

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Commercial National Financial Corporation

Jul 26, 2013, 02:08 ET

LATROBE, Pa., July 26, 2013 /PRNewswire/ -- Commercial National Financial Corporation (OTC Markets: CNAF)(Company), parent Company of Commercial Bank & Trust of PA, has reported results for the quarter ended June 30, 2013. The Company earned $1,348,000 (or $0.47 per average share outstanding) in the second quarter 2013 compared to $1,220,000 (or $0.43 per average share outstanding) in the second quarter 2012. The Company earned $2,450,000 (or $0.86 per average share outstanding) for the six-month period ended June 30, 2013 and $5,016,000 (or $1.75 per average share outstanding) for the six-month period ended June 30, 2012 when $3,195,000 in net securities gains were realized. The Company's annualized return on average assets and average equity were 1.44% and 10.30%, respectively, for the quarter ended June 30, 2013 compared to 1.31% and 8.86%, respectively, for the quarter ended June 30, 2012. The Company's annualized return on average assets and average equity for the six month period ended June 30, 2013 were 1.30% and 9.32%, respectively, compared to 2.61% and 18.35%, respectively, for the six month period ended June 30, 2012. Tier one risk-based, total risk-based and leverage capital ratios for June 30, 2013 were 22.24%, 23.00% and 13.02%, respectively.

President and Chief Executive Officer, Gregg E. Hunter noted, "Second quarter 2013 earnings of $1,348,000 represented a $246,000, or 22.32%, improvement over the $1,102,000 in earnings produced during 2013's first quarter. Core profitability and regulatory capital adequacy continue to significantly surpass prevailing banking industry norms due to outstanding earning asset credit quality, strong net interest margin, effective net operating expense control and uncommon tax efficiency. The Company's core earnings and capital remain supportive of the regular $0.26 per share common stock quarterly cash dividend payments to shareholders."

In addition to Latrobe, Pennsylvania where it is headquartered, the Company operates ten community banking facilities in Greensburg, Hempfield Township, 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.

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

			June 30,	December 31,	June 30,
			2013	2012	2012


ASSETS
Cash and due from banks on demand			$ 6,216	$ 6,468	$ 6,281
Interest bearing deposits with banks			4,883	32,113	47,487
	Total cash and cash equivalents		11,099	38,581	53,768

Securities available for sale			169,522	141,321	126,020
Restricted investments in bank stock			1,490	2,506	3,189

Loans			160,426	168,886	166,586
	Allowance for loan losses		(1,640)	(1,649)	(1,639)
		Net loans	158,786	167,237	164,947

Premises and equipment			3,171	3,136	3,046
Investment in Life Insurance			16,797	16,562	16,261
Other assets			4,901	3,719	4,523

	Total assets		$ 365,766	$ 373,062	$ 371,754

LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
	Deposits:
		Non-interest bearing	$ 106,717	$ 103,437	$ 100,586
		Interest bearing	211,514	213,020	211,993
		Total deposits	318,231	316,457	312,579

	Short-term borrowings		-	-	-
	Long-term borrowings		-	-	-
	Other liabilities		909	3,839	3,997
		Total liabilities	319,140	320,296	316,576

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 2013 and 2012

			7,200	7,200	7,200
	Retained earnings		53,566	52,604	54,703
	Accumulated other comprehensive income		(1,596)	5,506	5,819
	Less treasury stock, at cost, 739,047 shares in 2013 and 2012		(12,544)	(12,544)	(12,544)
		Total shareholders' equity	46,626	52,766	55,178

		Total liabilities and shareholders' equity	$ 365,766	$ 373,062	$ 371,754

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

			Three Months		Six Months
			Ended June 30		Ended June 30
			2013	2012	2013	2012
			(unaudited)	(unaudited)	(unaudited)	(unaudited)

INTEREST INCOME:
	Interest and fees on loans		$ 2,001	$ 2,282	$ 4,083	$ 4,711
	Interest and dividends on securities:
		Taxable	361	577	807	1,735
		Exempt from federal income taxes	1,314	883	2,314	1,846
	Other		10	30	26	40
	Total Interest income		3,686	3,772	7,230	8,332

INTEREST EXPENSE:
	Interest on deposits		215	304	441	647
	Interest on short-term borrowings		-	1	-	15
	Interest on long-term borrowings		-	-	-	1
	Total Interest expense		215	305	441	663

NET INTEREST INCOME			3,471	3,467	6,789	7,669
PROVISION FOR LOAN LOSSES			-	-	-	-

NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES			3,471	3,467	6,789	7,669

OTHER OPERATING INCOME:
	Asset management and trust income		246	234	483	474
	Service charges on deposit accounts		261	283	516	545
	Net Security gains		57	9	57	3,195
	Income from investment in life insurance		121	122	235	241
	Other income		52	39	151	153
	Total other operating income		737	687	1,442	4,608

OTHER OPERATING EXPENSES:
	Salaries and employee benefits		1,665	1,561	3,377	3,215
	Net occupancy expense		206	210	431	428
	Furniture and equipment		125	94	228	185
	Pennsylvania shares tax		138	126	276	252
	Legal and professional		63	82	126	163
	FDIC insurance expense		44	48	88	96
	Other expenses		639	698	1,297	1,412
	Total other operating expenses		2,880	2,819	5,823	5,751

INCOME BEFORE INCOME TAXES			1,328	1,335	2,408	6,526
Income tax expense (benefit)			(20)	115	(42)	1,510

	Net income		$ 1,348	$ 1,220	$ 2,450	$ 5,016

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

Earnings Per Share			$ 0.47	$ 0.43	$ 0.86	$ 1.75