LATROBE, Pa., Jan. 30, 2018 /PRNewswire/ -- Commercial National Financial Corporation (OTC Markets:CNAF)(Company), parent Company of Commercial Bank & Trust of PA, has reported results for the quarter ended December 31, 2017. The Company earned $3,548,000 (or $1.24 per average share outstanding) in the fourth quarter 2017 compared to $760,000 (or $0.26 per average share outstanding) in the fourth quarter 2016. The Company earned $6,866,000 (or $2.40 per average share outstanding) for the twelve-month period ended December 31, 2017 and $4,040,000 (or $1.41 per average share outstanding) for the twelve-month period ended December 31, 2016.

Fourth quarter 2017 earnings increased $2,788,000, or 366.84%, from 2016's fourth quarter and full-year 2017 earnings increased $2,826,000, or 69.95%, from 2016's full year. Fourth quarter and full-year 2017 earnings reflect a $2,504,000 earnings and capital benefit that was recorded due to a $1,903,000 deferred tax asset recapture and a $601,000 AFS/MTM deferred tax liability adjustment both of which primarily stemmed from the Company's well-proven securities portfolio investment activities.

The Company's annualized return on average assets and average equity for the quarter ended December 31, 2017 were 3.61% and 23.99%, respectively, compared to 0.83% and 5.28%, respectively, for the quarter ended December 31, 2016. The Company's annualized return on average assets and average equity for the twelve-month period ended December 31, 2017 were 1.70% and 11.89%, respectively, compared to 1.08% and 7.00%, respectively, for the twelve-month period ended December 31, 2016. Fourth quarter tax equivalent net interest margin was 4.35%. Tier one risk-based, total risk-based, leverage and common equity tier one capital ratios for December 31, 2017 were 22.76%, 23.28%, 14.07% and 22.76%, 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.

A special extra cash dividend of $0.26 per share was declared and paid during December 2017. As a result, total cash dividends paid in 2017 rose from $1.04 to $1.30 per share which represented a 25% increase over total cash dividends paid during 2016. Providing an attractive and reliable regular cash dividend income stream to all shareholders in the most equitable manner possible remains a top priority for the Company.

Direct and beneficial ownership by executive officers and directors of the Company's outstanding shares totaled 700,192 shares, or 24.47% on December 31, 2017.

As disclosed each year in the Annual Report to Shareholders, on December 31, 2017, the Company employed 99 people in full-time and part-time positions. Forty-seven (47) employees are represented by the United Auto Workers, Local 1799. Of that bargaining unit total, Thirty-five (35) employees are full-time and twelve (12) employees are part-time. The Company has had unionized employees since 1972. In 2013, the Company and the bargaining unit entered into a labor agreement that will expire in February 2019. 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.

 

COMMERCIAL NATIONAL FINANCIAL CORPORATION


CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION


(Unaudited)

(Dollars in thousands)













December 31


December 31






2017


2016










ASSETS






Cash and due from banks on demand


$                      4,933


$                      5,006


Interest bearing deposits with banks


49


8,788



Total cash and cash equivalents


4,982


13,794










Securities available for sale


145,669


128,197


Restricted investments in bank stock


412


111










Loans



209,660


201,664



Allowance for loan losses


(1,250)


(1,318)




Net loans


208,410


200,346










Premises and equipment


2,946


3,155


Investment in Life Insurance


19,230


18,682


Other assets


4,370


2,134











Total assets


$                  386,019


$                  366,419










LIABILITIES AND SHAREHOLDERS' EQUITY






Liabilities:







Deposits:








Non-interest bearing


$                  121,861


$                  118,439




Interest bearing


196,386


191,182




Total deposits


318,247


309,621











Short-term borrowings


5,650


-



Other liabilities


2,096


1,842




Total liabilities


325,993


311,463










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 2017 and 2016.


7,200


7,200



Retained earnings


61,715


59,170



Accumulated other comprehensive income


3,655


1,130



Less treasury stock, at cost,







739,047 shares in 2017 and 2016


(12,544)


(12,544)




Total shareholders' equity


60,026


54,956












Total liabilities and shareholders' equity

$                  386,019


$                  366,419


 

COMMERCIAL NATIONAL FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(Dollars in thousands, except per share data)

















Three Months


Twelve Months






Ended December 31


Ended December 31






2017


2016


2017


2016














INTEREST INCOME:











Interest and fees on loans


2,289


$               2,118


$               9,089


$               8,172



Interest and dividends on securities:












Taxable


1,002


434


3,714


2,264




Exempt from federal income taxes


513


804


2,562


3,246




Other


13


8


72


77



Total Interest income


3,817


3,364


15,437


13,759














INTEREST EXPENSE:











Interest on deposits


93


72


320


306



Interest on short-term borrowings


77


-


418


50



Total Interest expense


170


72


738


356














NET INTEREST INCOME


3,647


3,292


14,699


13,403


PROVISION FOR LOAN LOSSES


800


-


800


-














NET INTEREST INCOME AFTER










PROVISION FOR LOAN LOSSES


2,847


3,292


13,899


13,403














OTHER OPERATING INCOME:











Asset management and trust income


322


368


1,275


1,375



Service charges on deposit accounts


193


202


775


806



Net Security gains


777


8


777


1,196



Loss on sale of OREO


-


-


(6)


-



Income from investment in life insurance


126


172


523


500



Other income


41


38


241


229



Total other operating income


1,459


788


3,585


4,106














OTHER OPERATING EXPENSES











Salaries and employee benefits


1,831


1,763


7,128


7,305



Net occupancy expense


214


215


869


862



Furniture and equipment


238


178


507


569



Pennsylvania shares tax


128


119


506


484



Legal and professional


118


107


390


382



FDIC Insurance expense


32


2


120


145



Other expenses


648


738


2,952


2,975



Total other operating expenses


3,209


3,122


12,472


12,722














INCOME BEFORE INCOME TAXES


1,097


958


5,012


4,787


Income tax (benefit) expense 


(2,451)


198


(1,854)


747















Net income


$               3,548


$                  760


$               6,866


$               4,040














Average Shares Outstanding


2,860,953


2,860,953


2,860,953


2,860,953














Earnings Per Share


1.24


0.26


2.40


1.41


 

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SOURCE Commercial National Financial Corporation