Commercial National Reports September 30, 2014 Earnings Increases

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Commercial National Financial Corporation

Oct 27, 2014, 11:35 ET

LATROBE, Pa., Oct. 27, 2014 /PRNewswire/ -- Commercial National Financial Corporation (OTC Markets:CNAF)(Company), parent Company of Commercial Bank & Trust of PA, has reported results for the quarter ended September 30, 2014. The Company earned $1,534,000 (or $0.54 per average share outstanding) in the third quarter 2014 compared to $1,361,000 (or $0.47 per average share outstanding) in the third quarter 2013. The Company earned $4,802,000 (or $1.68 per average share outstanding) for the nine-month period ended September 30, 2014 and $3,811,000 (or $1.33 per average share outstanding) for the nine-month period ended September 30, 2013. The Company's annualized return on average assets and average equity were 1.54% and 11.63%, respectively, for the quarter ended September 30, 2014 compared to 1.48% and 12.25%, respectively, for the quarter ended September 30, 2013. The Company's annualized return on average assets and average equity for the nine month period ended September 30, 2014 were 1.62% and 12.27%, respectively, compared to 1.36% and 10.20%, respectively, for the nine month period ended September 30, 2013. Tier one risk-based, total risk-based and leverage capital ratios for September 30, 2014 were 22.66%, 23.37% and 13.19%, respectively.

President and Chief Executive Officer, Gregg E. Hunter noted, "Third quarter 2014 earnings increased $173,000, or 12.71%, while first nine months earnings increased $991,000, or 26.00%. Tax equivalent net interest margin was 5.09% in 2014's first nine months and the efficiency ratio was 56.39%. The Company's strong core financial performance and very substantial capital base significantly surpass those of the broader banking industry providing ample capacity to maintain the regular $0.26 per share quarterly common stock cash dividend payments to shareholders."

Mr. Hunter added, "On September 24, 2014, Commercial National Financial Corporation stock shares began trading on the OTCQX for banks marketplace. Trading on OTCQX distinguishes Commercial National Financial Corporation as one of the most established, well-managed and strongly capitalized community banks in the nation. OTCQX provides a shareholder-friendly trading experience through enhanced visibility and dedicated capital markets support. Keefe Bruyette and Woods, Inc. (KBW) serves as the Company's Corporate Broker on OTCQX. KBW is a FINRA member broker-dealer, specializing in bank stock trading and advising banks on strategic equity alternatives, that has been appointed by the Company's Board of Directors to provide guidance on the trading of its stock and access to institutional investors, investment bankers and other key market participants."

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)

			September 30,	December 31,	September 30,
			2014	2013	2013


ASSETS
Cash and due from banks on demand			$ 7,584	$ 8,036	$ 8,169
Interest bearing deposits with banks			6,804	3,999	114
	Total cash and cash equivalents		14,388	12,035	8,283

Securities available for sale			187,053	185,446	176,814
Restricted investments in bank stock			1,081	1,425	893

Loans			171,141	163,916	162,882
	Allowance for loan losses		(1,616)	(1,619)	(1,597)
		Net loans	169,525	162,297	161,285

Premises and equipment			3,310	3,096	3,163
Investment in Life Insurance			17,460	17,111	16,924
Other assets			4,487	12,924	13,491

	Total assets		$ 397,304	$ 394,334	$ 380,853

LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
	Deposits:
		Non-interest bearing	$ 107,141	$ 104,792	$ 102,711
		Interest bearing	213,033	211,769	207,971
		Total deposits	320,174	316,561	310,682

	Short-term borrowings		17,581	23,311	16,300
	Other liabilities		3,003	8,325	8,588
		Total liabilities	340,758	348,197	335,570

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 2014 and 2013

			7,200	7,200	7,200
	Retained earnings		57,591	55,020	54,183
	Accumulated other comprehensive income		4,299	(3,539)	(3,556)
	Less treasury stock, at cost, 739,047 shares in 2014 and 2013		(12,544)	(12,544)	(12,544)
		Total shareholders' equity	56,546	46,137	45,283

		Total liabilities and shareholders' equity	$ 397,304	$ 394,334	$ 380,853

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

			Three Months		Nine Months
			Ended September 30		Ended September 30
			2014	2013	2014	2013
			(unaudited)	(unaudited)	(unaudited)	(unaudited)

INTEREST INCOME:
	Interest and fees on loans		$ 1,938	$ 1,858	$ 5,752	$ 5,941
	Interest and dividends on securities:
		Taxable	198	298	651	1,105
		Exempt from federal income taxes	1,698	1,535	5,239	3,849
	Other		15	4	41	30
	Total Interest income		3,849	3,695	11,683	10,925

INTEREST EXPENSE:
	Interest on deposits		135	179	440	620
	Interest on short-term borrowings		18	3	58	3
	Interest on long-term borrowings		-	-	-	-
	Total Interest expense		153	182	498	623

NET INTEREST INCOME			3,696	3,513	11,185	10,302
PROVISION FOR LOAN LOSSES			-	-	-	-

NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES			3,696	3,513	11,185	10,302

OTHER OPERATING INCOME:
	Asset management and trust income		283	241	844	724
	Service charges on deposit accounts		249	268	733	784
	Net Security gains		-	(5)	14	52
	Income from investment in life insurance		120	127	348	362
	Other income		45	74	201	225
	Total other operating income		697	705	2,140	2,147

OTHER OPERATING EXPENSES:
	Salaries and employee benefits		1,730	1,702	5,276	5,079
	Net occupancy expense		219	210	660	641
	Furniture and equipment		99	58	302	286
	Pennsylvania shares tax		102	141	303	417
	Legal and professional		66	72	226	198
	FDIC insurance expense		48	45	144	133
	Other expenses		767	762	2,121	2,059
	Total other operating expenses		3,031	2,990	9,032	8,813

INCOME BEFORE INCOME TAXES			1,362	1,228	4,293	3,636
Income tax expense (benefit)			(172)	(133)	(509)	(175)

	Net income		$ 1,534	$ 1,361	$ 4,802	$ 3,811

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

Earnings Per Share			$ 0.54	$ 0.47	$ 1.68	$ 1.33