CNB Financial Corporation Reports First Quarter Earnings for 2018, Highlighted By Strong Organic Loan Growth

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CLEARFIELD, Pa., April 16, 2018 (GLOBE NEWSWIRE) -- CNB Financial Corporation (“CNB”) (NASDAQ:CCNE), the parent company of CNB Bank, today announced its earnings for the first quarter of 2018.  Highlights include the following:

Joseph B. Bower, Jr., President and CEO, stated, “We are pleased with the growth in the quarter of both deposits and loans.  The increases have come from across all four brands.  The growth in non-interest expenses in the quarter consist of several  items that are isolated to the first quarter.  We believe that the expense growth will slow throughout the rest of 2018.”

Net interest margin on a fully tax equivalent basis was 3.72% and 3.67% for the quarters ended March 31, 2018 and 2017, respectively.  The yield on earning assets increased 21 basis points to 4.53% for the quarter ended March 31, 2018 from 4.32% for the quarter ended March 31, 2017.  The cost of interest-bearing liabilities increased 17 basis points to 0.93% for the quarter ended March 31, 2018 from 0.76% for the quarter ended March 31, 2017.  

Total interest and dividend income increased by 17.1% to $29.4 million for the quarter ended March 31, 2018 from $25.1 million for the quarter ended March 31, 2017.  Net interest income increased by 13.7% to $24.1 million for the quarter ended March 31, 2018 from $21.2 million for the quarter ended March 31, 2017.

During the quarter ended March 31, 2018, CNB recorded a provision for loan losses of $1.6 million, as compared to a provision for loan losses of $1.0 million for the quarter ended March 31, 2017.  Net chargeoffs in the first quarter of 2018 were $569 thousand, compared to net chargeoffs of $800 thousand in the first quarter of 2017.  CNB Bank net chargeoffs totaled $45 thousand and $111 thousand during the quarters ended March 31, 2018 and 2017, or 0.01% and 0.02%, respectively, of average CNB Bank loans.  Holiday Financial Services Corporation is CNB’s consumer discount company and recorded net chargeoffs totaling $524 thousand and $689 thousand during the quarters ended March 31, 2018 and 2017, respectively. 

In the first quarter of 2018, one commercial real estate loan that was impaired at year end 2017 experienced further deterioration in the financial condition of the borrower, resulting in an additional provision for loan losses of $1.8 million.  In spite of the strong organic loan growth in the first quarter of 2018, CNB was able to decrease its general loan loss reserve due to CNB’s continued low historical loan loss experience and its forecast of probable incurred losses inherent in the loan portfolio as of March 31, 2018.

Net realized gains on available-for-sale securities were $0 during the quarter ended March 31, 2018, compared to $1.4 million during the quarter ended March 31, 2017.  Net realized and unrealized gains on trading securities were $14 thousand during the quarter ended March 31, 2018, compared to $188 thousand during the quarter ended March 31, 2017. Excluding the effects of securities transactions, non-interest income was $4.7 million for the quarter ended March 31, 2018, compared to $4.2 million for the quarter ended March 31, 2017.

As a result of CNB’s continued focus on growing its Private Client Solutions division, wealth and asset management revenues were $1.0 million during the quarter ended March 31, 2018, an increase of 18.3% from $871 thousand during the quarter ended March 31, 2017.  In addition, as a result of its organic deposit growth, CNB experienced an increase in service charges in deposit accounts of $157 thousand, or 14.4%, in the first quarter of 2018 compared to the first quarter of 2017.

Total non-interest expenses were $19.0 million and $17.0 million during the quarters ended March 31, 2018 and 2017, respectively. Salaries and benefits expense increased $530 thousand, or 5.9%, during the quarter ended March 31, 2018 compared to the quarter ended March 31, 2017.  As of March 31, 2018, CNB had 526 full-time equivalent staff, compared to 487 full-time equivalent staff as of March 31, 2017, an increase of 8.0%.  The remainder of the increase in non-interest expenses is primarily a result CNB’s continued growth and the servicing of a larger customer base, along with expenses totaling $698 thousand resulting from stock-based compensation, the change in value of deferred compensation accounts, and a sales tax assessment.                                     

As a result of the enactment of the Tax Cuts and Jobs Act in the fourth quarter of 2017, income tax expense decreased $1.3 million, or 54.0%, during the quarter ended March 31, 2018 compared to the quarter ended March 31, 2017.  CNB’s effective tax rate was 13.7% in the first quarter of 2018 compared to 27.4% in the first quarter of 2017.                                                           

CNB Financial Corporation is a financial holding company with consolidated assets of approximately $2.9 billion that conducts business primarily through CNB Bank, CNB Financial Corporation’s principal subsidiary.  CNB Bank is a full-service bank engaging in a full range of banking activities and services, including trust and wealth management services, for individual, business, governmental, and institutional customers.  CNB Bank operations include a private banking division, one loan production office, and 41 full-service offices in Pennsylvania, Ohio, and New York.  CNB Bank’s divisions include ERIEBANK, based in Erie, Pennsylvania with offices in northwest Pennsylvania and northeast Ohio; FCBank, based in Worthington, Ohio with offices in central Ohio; and BankOnBuffalo, based in Buffalo, New York with offices in northwest New York.  CNB Bank is headquartered in Clearfield, Pennsylvania with offices in central and north central Pennsylvania. More information about CNB Financial Corporation and CNB Bank may be found on the Internet at .

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to CNB’s financial condition, liquidity, results of operations, future performance and business.  These forward-looking statements are intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are those that are not historical facts. Forward-looking statements include statements with respect to beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions that are subject to significant risks and uncertainties and are subject to change based on various factors (some of which are beyond CNB’s control).  Forward-looking statements often include the words “believes,” “expects,” “anticipates,” “estimates,” “forecasts,” “intends,” “plans,” “targets,” “potentially,” “probably,” “projects,” “outlook” or similar expressions or future conditional verbs such as “may,” “will,” “should,” “would” and “could.”  CNB’s actual results may differ materially from those contemplated by the forward-looking statements, which are neither statements of historical fact nor guarantees or assurances of future performance.  For more information about factors that could cause actual results to differ from those discussed in the forward-looking statements, please refer to the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of and the forward-looking statement disclaimers in CNB’s annual and quarterly reports.

The forward-looking statements are based upon management’s beliefs and assumptions and are made as of the date of this press release.  CNB undertakes no obligation to publicly update or revise any forward-looking statements included in this press release or to update the reasons why actual results could differ from those contained in such statements, whether as a result of new information, future events or otherwise, except to the extent required by law.  In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this press release might not occur and you should not put undue reliance on any forward-looking statements.

The following tables supplement the financial highlights described previously for CNB Financial Corporation.

 

Contact:
Brian W. Wingard
Treasurer
(814) 765-9621

More news and information about CNB Financial

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Globe Newswire: 16:55 GMT Monday 16th April 2018

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