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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
Annual Report Pursuant to Section 13 or Section 15(D) of
The Securities Exchange Act of 1934
For the fiscal year ended December 31, 1995
Commission File Number 2-94863
CANANDAIGUA NATIONAL CORPORATION
(Exact name of Registrant as specified in its charter)
New York 16-1234823
(State of Incorporation) (IRS Employer Identification No.)
72 South Main Street, Canandaigua, NY 14424
(Address of principal executive offices) (Zip Code)
(716) 394-4260
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act: 240,000 shares $50
par common
Indicate by check mark whether the Registrant (1) filed all reports required to
be filed by Section 13 or 15 (D) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) been subject to such filing requirements
for the past 90 days. Yes [X] No [ ]
Disclosure of delinquent filers pursuant to Item 405 of Regulation S-K
(#229.405) is contained in registrant's definitive proxy statement incorporated
herein by reference in Part III of this Form 10-K.
Aggregate market value of the voting stock held by non-affiliates of the
Registrant as of January 31, 1996.
Common Stock, $50.00 par value - described on page 26 of 1995 Annual
Report and incorporated herein by reference.
Number of shares outstanding of the Registrant's shares of common stock
as of January 31, 1996. 161,155 shares, common stock, $50.00 par value
Certain portions of the documents listed below have been incorporated by
reference into the indicated Part of this Form 10-K.
(1) Portions of the Annual Report to Stockholders
for the year ended December 31, 1995 Part I, Item 2
(2) Notice of Annual Meeting of Stockholders Part II, Items 5 & 8
and Proxy Statement dated February 23, 1995 Part III, Items 10-13
(3) Index of Exhibits Part II, Item 5
Page 31
CANANDAIGUA NATIONAL CORPORATION
FORM 10-K
INDEX
Page Number
PART I.
Item 1. Business 4-17
Item 2. Properties 18
Item 3. Legal Proceedings 18
Item 4. Submission of Matters to a Vote of
Security Holders 18
PART II.
Item 5. Market for the Registrant's Common Stock
and Related Security Holder Matters 19
Item 6. Selected Financial Data 19
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operation 20-25
Item 8. Financial Statements and Supplementary Data 25
Item 9. Changes in Disagreements with Accountants on Accounting
and Financial Disclosure 25
PART III.
Item 10. Directors and Executive Officers of
the Registrant 26, 27
Item 11. Executive Compensation 27-29
Item 12. Security Ownership of Certain
Beneficial Owners and Management 29
Item 13. Certain Relationships and Related Transactions 30
PART IV.
Item 14. Exhibits, Financial Statement
Schedules and Reports on Form 8-K 31
Signatures 33, 34
PART I
Item 1. Business
Canandaigua National Corporation
The Canandaigua National Corporation, referred to as The Corporation, was
organized on October 31, 1984, and registered under the Bank Holding Company Act
of 1956, for the purpose of becoming a one-bank holding company. The formation
of the bank holding company was consummated on May 31, 1985, through the
exchange of 80,000 shares of Canandaigua National Corporation $50 par value
common stock for all of the outstanding shares of The Canandaigua National Bank
and Trust Company. The one-bank holding company serves as a means of increasing
the scope of banking and financial services in the market area served by The
Canandaigua National Bank and Trust Company. For the foreseeable future, the
Bank will remain the principal source of the Corporation's operating revenue and
net income.
The Canandaigua National Bank and Trust Company
The Canandaigua National Bank and Trust Company ("Bank") was incorporated
under the laws of The United States of America as a national bank in 1887.
Since that time, Bank has operated as a national banking association doing
business at several locations in Ontario County and at its Branch locations in
the towns of Mendon and Pittsford in Monroe County, New York.
As of December 31, 1995, Bank had total assets of approximately
$315,485,000; total stockholders' equity of approximately $35,519,000; and total
deposits of approximately $277,205,000. Its deposits are insured by the Federal
Deposit Insurance Corporation.
Bank engages in a full service commercial and consumer banking and trust
business. Bank, with its main office at 72 South Main Street, Canandaigua, New
York, provides services to its customers through its network of ten branches
which include drive-in facilities and customer Bank communication terminals.
Bank's full service offices are located in Ontario County and in the town of
Mendon in Monroe County, New York.
Bank's services include accepting time, demand and savings deposits, NOW
accounts, regular savings accounts, money market certificates, investment
certificates, fixed rate certificates of deposit and club accounts. Its
services also include making secured and unsecured commercial and consumer
loans, financing commercial transactions either directly or through regional
industrial development corporations, making construction and mortgage loans
and the renting of safe deposit facilities. Additional services include
making residential mortgage loans, revolving credit loans with overdraft
checking protection, small business loans, and student loans. Bank's
business loans include seasonal, credit, collateral, and term loans. Trust
services provided by Bank include services as executor and trustee under
Item 1. Business
The Canandaigua National Bank and Trust Company - continued
wills and deeds, as guardian and custodian and as trustee and agent for pension,
profit sharing, individual retirement account and other employee benefit trusts
as well as various investment, pension and estate planning services. Trust
services also include service as transfer agent and registrar of Canandaigua
National Corporation stock and as paying agent for various bond issues and as
escrow agent. In 1995 the Bank formed a subsidiary (CNB Operating Subsidiary
No.1, Inc.). The primary business of this company is to sell life insurance to
individuals. This company is an agency only.
Bank has a relatively stable deposit base and no material amount of deposits
is obtained from a single depositor or group of depositors (including federal,
state and local governments). Bank has not experienced any significant seasonal
fluctuations in the amount of its deposits nor does Bank rely on foreign sources
of funds or income.
Territory Served and Competition
All phases of Bank's business are highly competitive. Bank's market area is
generally Ontario County, with concentration in the Canandaigua, New York area.
Bank competes with local commercial banks as well as other commercial banks with
branches in Bank's market area as well as federal savings and loan associations
and non-bank banks and credit unions. Bank considers its competition to be
Chase Manhattan Bank, N.A., Key Bank, National Bank of Geneva, Community Bank,
N.A., and WCTA Federal Credit Union located in Canandaigua, New York and Sears
Financial Network Center and Fleet Bank, located in Rochester, New York.
Bank, along with other commercial banks, competes with respect to its lending
activities as well as in attracting demand deposits, with savings banks, savings
and loan associations, insurance companies, regulated small loan companies,
non-bank banks and credit unions. Bank also competes with insurance companies,
investment counseling firms, mutual funds and other business firms and
individuals in corporate trust and investment management services.
Bank is generally competitive with all financial institutions in its service
area with respect to interest rates paid on time and savings deposits and
interest rates charged on loans and service charges on deposit accounts.
Bank employed 208 people as of December 31, 1995.
Supervision and Regulation
Canandaigua National Corporation is incorporated under the laws of the State
of New York and is directly supervised by the Federal Reserve Bank under the
laws governing one-bank holding companies. In addition, the Corporation reports
to the Securities and Exchange Commission under the laws governing corporations
with registered securities.
As a national bank and member of the Federal Reserve System, the Bank is
subject to regulations of the Comptroller of the Currency and the Board of
Governors of the Federal Reserve System. As an insured bank under the Federal
Deposit Insurance Act, Bank is also regulated by the Federal Deposit Insurance
Corporation. Representatives of the Comptroller of the Currency regularly
conduct examinations of Bank's affairs and records, and Bank must furnish
quarterly reports to the Comptroller.
Government Monetary Policies and Economic Controls
The earnings of Bank are affected by the policies of regulatory authorities
including the Comptroller of the Currency, the Board of Governors of the Federal
Reserve System and the Federal Deposit Insurance Corporation. An important
function of the Federal Reserve System is to regulate the money supply and
interest rates. Among the instruments used to implement these objectives are
open market operations in U.S. Government Securities, changes in reserve
requirements against member bank deposits, and changes in the federal discount
rate. These instruments are used in varying combinations to influence overall
growth and distribution of bank loans, investments and deposits, and their use
may also affect interest rates charged on loans or paid for deposits.
The policies and regulations of the Federal Reserve Board have had, and will
probably continue to have, a significant effect on Bank's deposits, loans and
investment growth, as well as the rate of interest earned and paid, and are
expected to affect Bank's operations in the future. The effect of such policies
and regulations, if any, upon the future business and earnings of Bank cannot
accurately be predicted.
Consolidated Financial and Statistical Data
A detailed review of the business activities of the Corporation and Bank is
presented in the following pages.
I. Distribution of Assets, Liabilities and Stockholders' Equity;
Interest Rates and Interest Differential
A. Average Balance Sheet (In Thousands)
Average Assets 1995 1994 1993
Cash & Due from Banks $ 13,392 $ 14,178 $ 12,649
Securities:
U.S. Government Securities 32,479 28,438 26,454
Obligations of States and
Political Subdivisions: Tax Exempt 28,349 30,402 32,440
Taxable 1,131 899 1,097
Other 12,706 13,703 13,117
Federal Funds Sold 12,023 14,689 28,709
Loans 209,280 202,622 197,168
Allowance for Loan Losses (2,213) (2,213) (2,415)
Premises & Equipment - net 8,269 8,087 8,181
Other Assets 5,354 4,507 4,146
________ ________ _______
Total $320,770 $315,312 321,546
Average Liabilities & Stockholders' Equity
Deposits:
Interest Bearing Demand $ 32,989 $ 37,913 $ 39,593
Non-interest Bearing Demand 46,967 44,566 39,553
Savings 118,300 137,669 148,667
Other Time 84,746 61,151 62,345
_______ _______ _______
Total 283,002 281,299 290,158
Short-term Borrowings and
Securities Sold Under Agreements
to Repurchase 0 8 0
Borrowing from FHLB 1,304 0 0
Other Liabilities 477 970 924
_____ _______ _______
Total Liabilities 284,783 282,277 291,082
Stockholders' Equity 35,987 33,035 30,464
________ ________ ________
Total $320,770 $315,312 $321,546
B. Average Rates and Yields (Dollars In Thousands)
1995 1994
AVERAGE AVERAGE
AVERAGE YIELD/ AVERAGE YIELD/
BALANCE INT. RATE BALANCE INT. RATE
Interest Earning Assets:
U.S. Gov't. Securities $ 32,479 $ 1,865 5.74% $ 28,438 $ 1,378 4.85%
Obligations of States
& Political
Subdivisions-Tax Exempt 28,349 1,395 4.92% 30,402 1,376 4.53%
Taxable 1,131 64 5.66% 899 55 6.12%
Federal Funds Sold 12,023 697 5.80% 14,689 558 3.80%
Loans (1)(2) 209,280 19,998 9.56% 202,622 17,654 8.71%
Other Securities 12,023 812 6.75% 13,703 868 6.33%
_______ ______ _______ ______
Total Interest
Earning Assets $295,285 $24,831 8.41% $290,753 $21,889 7.53%
_______ ______ ____ _______ ______ ____
Interest Bearing Liabilities:
Demand Deposits 32,989 $ 601 1.82% $ 37,913 $ 724 1.91%
Savings 118,300 3,570 3.02% 137,669 3,568 2.59%
Other Time 84,746 4,614 5.45% 61,151 2,837 4.64%
Short-term Borrowings and
Securities Sold Under
Agreements to
Repurchase 0 0 0% 8 0 0%
Borrowing from FHLB 477 11 2.31% 0 0 0%
_______ ______ ____ _______ _____
Total Interest
Bearing Liabilities $236,512 $8,796 3.72% $236,741 $7,129 3.01%
_______ ______ ____ _______ ______ ____
Net Interest Income $16,035 $14,760
______ ______
Net Yield 4.69% 4.52%
____ ____
Net Interest Income
to Earning Assets 5.43% 5.08%
____ ____
(1) Non-accrual loans are included in the average loan balance.
(2) Loan interest includes fees on loans of $610,946, $758,214, and $1,225,134
in 1995, 1994, and 1993 respectively.
Average Rates and Yields-continued (Dollars in Thousands)
1993
AVERAGE
AVERAGE YIELD/
BALANCE INT. RATE
Interest Earning Assets:
U.S. Gov't. Securities $ 26,454 $ 1,336 5.05%
Obligations of States
& Political
Subdivisions-Tax Exempt 32,440 1,498 4.62%
Taxable 1,097 58 5.29%
Federal Funds Sold 28,709 835 2.89%
Loans (1)(2) 197,168 17,272 8.76%
Other Securities 12,759 825 6.49%
_______ ______
Total Interest
Earning Assets $298,627 $21,824 7.31%
_______ ______ ____
Interest Bearing Liabilities:
Demand Deposits $ 39,593 $ 792 2.00%
Savings 148,667 3,830 2.58%
Other Time 62,345 3,184 5.11%
Short-term Borrowings and
Securities Sold Under
Agreements to
Repurchase 0 0 0%
Borrowing from FHLB 0 0 0%
_______ ______
Total Interest Bearing Liabilities $250,605 $ 7,806 3.12%
_______ ______ ____
Net Interest Income $14,018
______
Net Yield 4.19%
____
Net Interest Income to Earning Assets 4.69%
____
C. Rate/Volume Analysis (Dollars In Thousands)
1995 vs 1994 1994 vs 1993
Increase (Decrease) Average Average Average Average Average Average
Due to Change In: Volume Rate Total Volume Rate Total
Interest Income:
Loans $ 580 $ 1,764 $ 2,344 $ 474 $(92) $382
Federal Funds Sold (101) 240 139 (483) 206 (277)
Investment Securities:
U.S. Gov't Securities 196 291 487 97 (55) 42
Obligations of State
and Political
Subdivision-Exempt (93) 112 19 (93) (29) (122)
-Taxable 14 (5) 9 (11) 8 (3)
Other (106) 50 (56) 58 (15) 43
______ _______ _______ _____ ____ ____
Total Interest
Income 490 2,452 2,942 42 23 65
Interest Expense:
Deposits:
Interest Bearing
Demand (94) (29) (123) (33) (35) (68)
Savings (502) 504 2 (285) 23 (262)
Other Time 1,094 683 1,777 (60) (287) (347)
Borrowing from FHLB 0 11 11 0 0 0
_____ ____ _____ ____ ____ ____
Total Interest
Expense (498) 1,169 1,667 (378) (299) (677)
_____ _____ _____ ___ ___ ___
Net Interest Income $( 8) $1,283 $1,275 $ 420 $ 322 $ 742
Note: Volume changes are computed by multiplying the volume difference by
the prior year's rate. Rate changes are computed by multiplying the rate
difference by the prior year's balance.
The change in interest due to both rate and volume has been allocated to
rate and volume changes in proportion to the relationship of the absolute
dollar amounts of the change in each.
I. Investment Portfolio
A. Investment Portfolio, including FHLB and FRB stock (Dollars In Thousands)
------December 31--------
1995 1994 1993
U.S. Government Obligations $31,955 $27,972 $26,574
Mortgage backed Securities 310 283 331
Obligations of States and Political
Subdivisions: Exempt 26,321 29,921 32,879
Taxable 839 904 1,685
Other Securities 12,495 13,514 13,548
_______ _______ _______
Total $71,920 $72,594 $75,017
B. Investment Portfolio, including FHLB and FRB stock by Maturity with Weighted
Average Yield (Dollars In Thousands)
December 31, 1995
Within One Through Six Through Over
One Year Five Years Ten Years Ten Years
Amount Yield Amount Yield Amount Yield Amount Yield
U.S. Treasury
Obligations $14,676 5.62% $15,252 6.44% 0 0
Mortgage backed
Securities 12 8.44% 55 8.36% 70 8.22% 173 8.01%
US Gov't Agencies 0 1,000 5.37% 1,027 7.15% 0
Obligations of State
and Political
Subdivisions
Taxable: 250 6.25% 540 6.45% 49 6.65% 0
Exempt: 7,637 4.67% 15,230 4.84% 2,645 5.20% 809 6.20%
Other Securities 2,259 6.22% 7,438 6.39% 948 6.95% 1,850 6.35%
_______ _______ ______ ______
Total $24,834 $39,515 $4,739 $2,832
Note: (a) Securities with no stated maturity are included in the "Over Ten
Years" category.
(b) Yield on "States and Political Subdivisions" (non-taxable
investments) are not reflected on a tax equivalent basis.
III. Loan Portfolio
The loan portfolio is comprised solely of domestic loans which are widely
diversified with no concentrations in an industry group or with borrowers
engaged in similar activities. The following summary shows the
classifications of loans by category.
A. Types of Loans
December 31,
1995 1994 1993 1992 1991
(Dollars In Thousands)
Commercial, financial
and agricultural $ 28,326 32,442 30,367 27,672 24,964
Consumer 24,269 26,890 23,297 22,562 23,163
Residential mortgage 86,641 83,018 78,315 86,094 91,966
Commercial mortgage 62,038 60,278 59,036 55,100 56,534
Other 8,770 8,121 7,288 3,523 3,804
________ ________ ________ ________ ________
Total 210,044 210,749 198,303 194,951 200,431
Less: Allowance for
loan losses 2,258 2,202 2,277 2,152 1,888
________ _______ _______ _______ _______
Loans, Net $207,786 208,547 196,026 192,799 198,543
B. Maturities and Sensitivities of Loans to Changes in Interest Rates
The following table sets forth the maturities and sensitivity to changes in
interest rates of the loan portfolio exclusive of real estate mortgage and
installment loans as of December 31, 1995.
Remaining Maturity
Within One Through Over
One Year Five Years Five Years Total
(Dollars In Thousands)
Commercial, financial
and agricultural $11,202 $10,230 $6,894 $28,326
Loans maturing after one year:
With a predetermined interest
rate $ 7,008
With a floating or adjustable rate $10,116
The maturities set forth above are based upon contracted maturities. Demand
loans, overdrafts and certain time loans, the principal of which will be
renewed in whole or in part, are included in the "Within One Year"
classification. The loan policy encourages a repayment schedule to be set
up whenever possible.
B. Maturities and Sensitivities of Loans to Changes
In Interest Rates - continued
Bank policy provides that a demand loan should not be renewed more than
once, with renewals at the then prevailing interest rates and with the
assurance the borrower demonstrates the ability to repay on maturity of the
loan.
The Bank provides standby letters of credit commitments which also provide
for availability of funds over a period of generally one year. All such
commitments have fixed expiration dates and may require the payment of a
fee.
The Bank extends lines of credit under which a customer may borrow for
various purposes such as letters of credit. The extension of these
commitments and lines of credit have been in the normal course of business.
In the opinion of Management, at December 31, 1995, there are no material
commitments to extend credit which represent unusual risks.
C. Risk Elements
(1) Non-accrual, Past Due and Restructured Loans
The risk elements in the loan portfolio are disclosed in the following
schedule.
December 31,
Non-Performing Assets 1995 1994 1993 1992 1991
(Dollars In Thousands)
Commercial, financial &
agricultural $ 1,640 $ 2,350 $1,151 $2,959 $5,939
Real-estate 9,307 8,912 4,866 1,569 1,194
Consumer loans 0 0 0 0 25
______ ______ _____ _____ _____
Total non-performing loans 10,947 11,262 6,017 4,528 7,158
Other real estate owned 2,158 723 721 326 200
_______ _______ ______ ______ ______
Total non-performing assets $13,105 $11,985 $6,738 $4,854 $7,358
Non-performing loans to year
end loans 5.21% 5.35% 3.03% 2.32% 3.57%
Non-performing assets to year end
loans & other real estate owned 6.24% 5.68% 3.40% 2.54% 3.67%
Item III. C. (continued)
Past Due 90 Days or More 1995 1994 1993 1992 1991
.
Commercial, financial &
agricultural $ 12 $ 4 $ 381 $ 721 $ 645
Real estate 101 254 889 533 274
Consumer 55 44 69 77 107
____ ____ ______ ______ ______
Total past due 90 days
or more $168 $302 $1,339 $1,331 $1,026
1995 1994 1993 1992 1991
Restructured Loans $0 $0 $393 $393 $393
The accrual of interest on commercial and real estate loans is
discontinued when the loans become 90 days delinquent or when, in management's
judgment, the collection of principal and interest is uncertain. Recognition
of interest income on non-accrual loans does not resume until management
considers principal and interest collectible. Installment loans are generally
charged off upon becoming 120 days past due.
Additional gross income of $739,000, $496,000, and $279,000 would have
been reported during 1995, 1994, and 1993, respectively, if the loans reported
above as non-accrual and restructured loans had been current in accordance with
the original terms.
(2) Potential Problem Loans
Loans which are not disclosed pursuant to Item III C. (1), but where known
information about credit problems of borrowers causes Management to have
serious doubts as to the ability of such borrowers to comply with present
loan repayment terms which may result in disclosure in Item III C. (1) above
amounted to $325,071 as of December 31, 1995.
IV. Summary of Loan Loss Experience
An analysis of the Allowance for Loan Losses and statistics
relating to the relationship of the Allowance and Charge-offs to Loans is
presented in the following summary.
Year Ended
December 31,
1995 1994 1993 1992 1991
(Dollars In Thousands)
Total loans outstanding
at end of year (1) $210,044 $210,749 $198,303 $192,799 $200,431
Average loans outstanding
during year (1) $203,280 $202,622 $197,168 $196,680 $205,979
Allowance for loan losses:
Balance at beginning
of year $ 2,202 $ 2,277 $ 2,152 $ 1,888 $ 1,705
Charge-offs
Commercial, financial
and agricultural 810 712 481 222 591
Installment 191 145 245 289 255
Real Estate Mortgage (2) 151 65 100 259 10
Credit Cards 77 89 69 43 38
_____ _____ ___ ___ ___
Total 1,229 1,011 895 813 894
Recoveries: (2)
Commercial, financial and
agricultural 90 82 218 121 98
Installment 118 143 132 131 121
Real Estate Mortgage 20 0 53 0 31
Credit Cards 26 12 17 25 27
____ ____ ____ ____ ____
Total 254 237 420 277 277
____ ____ ____ ____ ____
Net charge-offs (975) (774) (475) (536) (617)
Provision charged
to expense 1,031 699 600 800 800
______ ______ ______ ______ ______
Balance at end of year $2,258 $2,202 $2,277 $2,152 $1,888
Ratio of net charge-offs
to average loans
outstanding .47% .38% .24% .27% .30%
(1) Loans are shown net of unearned discount.
(2)Includes Residential and Commercial Mortgages.
IV. Summary of loan loss experience - continued
Allocation of allowance for loan losses
December 31
(Dollars in Thousands)
1995 1994 1993
% of % of % of
Loans to Loans to Loans to
Total Total Total
Amount Loans Amount Loans Amount Loans
Commercial, financial
and agricultural (1) $1,809 43% $1,534 44% $1,560 45%
Real Estate Mortgage 81 41% 160 40% 125 40%
Consumer 230 12% 360 13% 421 12%
Other 0 4% 0 3% 0 3%
Unallocated 138 N/A 148 N/A 171 N/A
_____ ___ _____ ___ _____ ___
Total $2,258 100% $2,202 100% $2,277 100%
December 31
(Dollars in Thousands)
1992 1991
% of % of
Loans to Loans to
Total Total
Amount Loans Amount Loans
Commercial, financial
and agricultural (1) $1,549 43% $1,336 41%
Real Estate Mortgage 100 44% 340 11%
Consumer 300 11% 0 2%
Other 0 2% 40 46%
Unallocated 203 N/A 172 N/A
_____ ___ _____ ___
Total $2,152 100% $1,888 100%
The determination of the allowance for loan losses is based on an analysis of
the loan portfolio and reflects an amount which, in management's judgment, is
adequate to provide for loan losses. This analysis is based on management's
periodic evaluation, which considers factors such as past loss experience,
identification of adverse conditions that may affect a borrower's ability to
repay, an assessment of current and expected economic conditions and the
estimated value of any underlying collateral. The allowance for loan losses is
applicable for any loan losses despite the allocation provided above. In
addition, future allocations may change due to circumstances inherent in the
loan portfolio
(1)Includes Commercial Mortgages.
V. Deposits
The following summary sets forth the average amounts of the various types of
deposits for December 31, 1995, 1994 and 1993, and the average rate paid on
each.
1995 1994 1993
Amount Rate Amount Rate Amount Rate
(Dollars In Thousands)
Non-interest bearing
demand $ 46,676 -- $ 44,566 -- $ 39,553 --
Interest bearing demand 32,989 1.82% 37,913 1.91% 39,593 2.00%
Savings 118,300 3.02% 137,669 2.59% 148,667 2.58%
Other time 84,746 5.45% 61,151 4.64% 62,345 5.11%
________ ________ ________
Total $282,711 3.11% $281,299 2.53% $290,158 2.69%
The following table sets forth the time certificate of deposits of $100,000 or
greater, classified by the time remaining until maturity, which were on deposit
as of December 31, 1995.
1995
(In Thousands)
Three months or less $18,428
Over three through six months 536
Over six through twelve months 562
Over twelve months 1,389
_______
Total $20,915
VI. Return on Equity and Assets
The following table sets forth certain ratios used in evaluating financial
position and results of operations.
December 31,
1995 1994 1993
Return on average total assets 1.26% 1.18% 1.07%
Return on average equity 10.88% 11.21% 11.25%
Dividend payout ratio 28.78% 26.07% 25.79%
Average equity to total
average assets 11.22% 10.48% 9.47%
Item 2. Properties
Canandaigua National Corporation occupies space at the main office of the Bank.
No real property is owned by the Corporation. The Corporation leases real
property in Farmington, Mendon, Manchester, Victor (Eastview Mall), Pittsford,
under long-term renewable leases. The premises are sublet to the Bank for its
Farmington Branch Office.
The Bank's operations are conducted from nine offices located in Ontario
County, New York and two offices located in Monroe County, New York. The main
office of the Bank is a three-story structure located at 72 South Main Street,
Canandaigua, New York. The administrative, operational and electronic data
processing offices of the Bank are located in this facility. The Bank owns
branch offices which are located on the main street in Victor, New York;
Holcomb, New York; and Honeoye, New York. The Bank subleases space for branch
offices in Farmington, New York, at Wade's Supermarket located on Route 96; in
Canandaigua, New York at 709 South Main Street; in Shortsville-Manchester in
the Bliss Shurfine Foodmart; in the Town of Mendon, Monroe County, New York in
the Hitching Post Plaza in the Big-M Food Market; in Victor, New York in the
Eastview Mall and in Pittsford, New York at State Street. There are drive-in
facilities located at all offices except for the Eastview Mall and Pittsford
offices.
The Bank provides 24-hour banking services to Bank customers through automatic
teller facilities located at each office and through remote Automatic Teller
Machines located at the Finger Lakes Community College on Lincoln Hill in the
Town of Hopewell, New York, and at F.F. Thompson Hospital located on North
Parrish Street, Canandaigua, New York.
The carrying value of the properties as of December 31, 1995, which is required
to be included herein pursuant to Item 102 of Regulation S-K, is included under
the caption "Notes to Consolidated Financial Statements" set forth on pages 11
through 25 of the 1995 Annual Report to Stockholders and is incorporated herein
by reference.
Item 3. Legal Proceedings
The Company and its subsidiary are not involved in any pending legal proceeding
other than routine legal proceedings undertaken in the ordinary course of
business. In the opinion of the management, after consultation with counsel,
the aggregate amount involved in such proceedings is not material to the
consolidated financial condition or results of operations of the Company.
Item 4. Submission of Matters to a Vote of Security Holders
NONE
PART II
Item 5. Market for the Registrant's Common Stock
and Related Security Holder Matters
The information required to be included herein, pursuant to Item 201 of
Regulation S-K, is incorporated herein by reference from the pages of the 1995
Annual Report to Stockholders and proxy statement set forth below:
Required Information Annual Report Caption Annual Report Page
Market information "Common Stock Data" 26
Dividends "Common Stock Data" 26
"Stockholders' Equity" 9
Holdings: (At December 31, 1995, the Corporation had approximately 684
shareholders.) Information regarding beneficial ownership of the Corporation's
stock is set forth on pages 1, 2, 3, and 7 of the Corporation's proxy statement
and incorporated herein by reference.
Item 6. Selected Financial Data
This table represents a summary of selected components of the Corporation's
consolidated financial statements for the five years ended December 31, 1995.
All information concerning the Corporation should be read in conjunction with
the consolidated financial statements and related notes.
Selected Financial Data
(Dollars in Thousands except per share data)
1995 1994 1993 1992 1991
Net Interest Income $ 16,035 14,760 14,018 13,598 13,029
Provision for Loan Losses $ 1,031 699 600 800 800
Non-Interest Income $ 3,393 3,268 3,469 3,157 2,432
Non-Interest Expense $ 12,684 12,022 12,195 11,542 10,775
Applicable Income Taxes $ 1,797 1,604 1,265 1,115 1,002
Net Income $ 3,916 3,703 3,427 3,298 2,884
Per Share Data:
Net Income $ 24.31 23.01 21.32 20.54 17.99
Cash Dividends $ 7.00 6.00 5.50 5.13 4.88
Balance Sheet Data:
Total Assets $317,209 310,541 $314,640 $320,876 $315,432
Total Equity $ 37,397 34,538 31,744 29,162 26,652
Average Assets $320,770 315,312 321,546 315,177 300,409
Average Equity $ 35,987 33,035 30,464 27,939 25,682
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations
The purpose of this discussion is to focus on information about
Canandaigua National Corporation's financial condition and results of
operations which is not otherwise apparent from the consolidated financial
statements in the annual report. Reference should be made to those statements
and the selected financial data presented elsewhere in this report for an
understanding of the following discussion and analysis.
Liquidity and Interest Rate Sensitivity Management
Liquidity is defined as the ability to generate adequate amounts of cash
to meet the demand for cash from depositors who wish to withdraw funds,
borrowers who require funds to meet their credit needs, and the need for
operating funds and capital expansion.
Interest rate sensitivity management seeks to avoid fluctuating net
interest margins and to enhance consistent growth of net interest income
through periods of changing interest rates. Thus liquidity and interest rate
sensitivity must be jointly managed through asset/liability policy to provide
optimum results for the Corporation.
Asset liquidity is found in cash, federal funds sold, deposits with other
financial institutions, short term security holdings, and loan repayments. On
average for 1995, federal funds sold, cash and due from banks, and interest
bearing deposits with other banks totaled $25.4 million. The securities
portfolio is also an important source of liquidity. As of December 31, 1995,
approximately $24.8 million amortized cost of the portfolio matured in one year
or less. Combining these two major sources of liquidity, the Corporation had
$50 million of readily available assets, which was 15.6% of average assets for
1995. Management believes that liquidity needs are adequately addressed, but
also has short term and long term borrowings available from the Federal Reserve
Bank and the Federal Home Loan Bank.
Interest rate sensitivity varies with different types of interest earning
assets and interest bearing liabilities. In general, short term interest
sensitive assets, such as loans tied to the prime rate, will have greater
sensitivity than fixed rate home mortgages or securities due in over one year.
Similarly, money market and passbook savings accounts have more sensitivity
than certificates of deposit maturing after one year. The Corporation has
chosen to limit both its asset and liability exposure in longer term time
frames so as to avoid large mismatches of assets and liabilities that could
cause large earnings swings.
The following chart indicates rate sensitivity at December 31, 1995:
INTEREST RATE SENSITIVITY GAPS
As of December 31, 1995
(In Thousands)
MATURITIES
0 - 3 4 - 12 1 - 5 Over 5
MONTHS MONTHS YEARS YEARS
Loans $101,668 2,747 76,197 29,432
Securities 8,552 16,282 39,515 7,613
Federal Funds sold 6,600
________ ______ _______ ______
Interest-earning
assets $116,820 19,029 115,712 37,045
________ ______ _______ ______
Certificate of Deposits 32,862 24,327 33,077
Savings 63,895
Royal Blue Money Market 15,784
Now & Super Now 31,921
Money Market 25,406
_______ ______ ______ ______
Interest-bearing
liabilities 169,868 24,327 33,077 0
_______ ______ ______ ______
Interest sensitivity
gap $ (53,048) (5,298) 82,635 37,045
Interest-earning
assets 116,820 19,029 115,712 37,045
Interest-bearing
liabilities 169,868 24,327 33,077 0
_______ ______ _______ ______
Interest sensitivity
gap $ (53,048) (5,298) 82,635 37,045
Rate Sensitive Assets
divided by Rate Sensitive
Liabilities 0.69 .78 3.50
The chart indicates that the Corporation was repricing $53.0 million more
of interest earning liabilities than interest bearing assets in the 0-3 month
range. This gap is not considered to be a problem, as a good portion of the
savings balances are not considered sensitive to rate change. However, the
Corporation will be challenged in a rising interest rate environment to
maintain its interest margins. For the 4-12 month period, the Corporation is
modestly liability sensitive, as $5.3 million more of interest bearing
liabilities are being repriced than interest earning assets. For the entire
one year range, the Corporation is repricing $58.3 million more interest
bearing liabilities than assets, or 20.21% of earning assets. This liability
sensitivity has increased from $52.4 million and 17.91% of earning assets last
year. The imbalance was due to the movement of deposits from savings to time
deposits with a longer maturity along with recording loans with a longer
maturity. The Corporation is asset sensitive at $82.6 million for the one to
five year range, as interest earning assets increased $11.5 million from last
year's amounts, along with an interest bearing liabilities increase of $8.2
million.
For the entire portfolio range, the Corporation is asset sensitive at
$64.0 million versus asset sensitivity of $57.6 million last year. With
interest rate forecasts continuing to suggest declines, our earnings should be
favorably impacted if we can continue to cut liability rates at the same pace
as earning assets. We will have some difficulty, however, as short term
liability rates are at or near historic lows. Continued declines could lead to
deposit outflows, as investors seek higher returns in other available products.
We may have to limit our liability rate decreases in order to continue to fund
the bank, and that may have a slightly negative impact on historic spreads.
Hopefully increasing lending will offset some of the decline.
Capital Resources
Total Stockholders' equity at December 31, 1995, was $37,397,000,
representing an increase of $2,859,000 (or 8.28%) over 1994. Primary capital,
defined as shareholders equity plus loan loss reserve, was $39,655,000 at
December 31, 1995, or 12.36% of average assets versus $36,717,000 or 11.65% of
average assets at December 31, 1994.
The Federal Reserve Board standards require banks and bank holding
companies to maintain capital based on "risk adjusted" assets so that
categories of assets with potentially higher credit risk will require more
capital backing than assets with lower risk. In addition, banks and bank
holding companies are required to maintain capital to support, on a risk-
adjusted basis, certain off balance sheet activities such as loan commitments
and interest rate swaps. Capital is classified into two tiers. Tier 1 capital
consists of common shareholders' equity, non-cumulative and cumulative
perpetual preferred stock, and minority interests less goodwill and less net
unrealized gain on securities available for sale. Tier 2 capital consists of
allowances for loan and lease losses, hybrid capital instruments, term
subordinated debt, and intermediate-term preferred stock. All banks are
required to meet a minimum ratio of 8% of qualifying total capital to risk
adjusted total assets with at least 4% Tier 1 capital.
The table below illustrates the Corporation's regulatory capital ratio
at December 31, 1995 and December 31, 1994:
1995 1994
(dollars in thousands)
Tier 1 Capital $ 37,344 $ 34,515
Tier 2 Capital $ 2,258 $ 2,202
Total Qualifying Capital $39,602 $ 36,717
Risk Adjusted Total Assets $213,442 $213,802
Tier 1 Risk Based Capital Ratio 17.50% 16.14%
Total Risk Based Capital Ratio 18.55% 17.17%
Leverage Ratio 10.48% 10.94%
As shown in the table, the Corporation's Tier 1 Risk Based Capital has
grown 8.4%, and Total Risk Based Capital has increased 8.0% from year end 1994
levels.
The leverage ratio (Tier 1 Capital divided by total assets less goodwill)
must be at least 3%. The Corporation's leverage ratio was 10.48% as of
December 31, 1995.
The capital ratios of the Corporation are strongly in excess of minimum
regulatory requirements, indicating an ability to meet customer demand and
market competition, while providing sufficient earnings to strengthen the
capital base annually. The Corporation believes that its strong capital base
will allow it to continue a reasonable dividend payment.
Dividends
Payments of dividends by the Bank to the Company is limited or restricted
in certain circumstances. According to federal banking law, the approval of
the Office of the Comptroller of the Currency is required for the declaration
of dividends in any year which dividends exceed the total of net income for
that year plus retained income for the preceding two years. At December 31,
1995, approximately $8,069,000 was available for payment of dividends to the
Company.
Cash dividends for 1995 amounted to $1,127,000, an increase of $161,000 or
16.67% over the $966,000 paid in 1994. Dividends paid were 28.8% and 26.1% of
1995 and 1994 earnings respectively.
Results of Operations
Net interest income is the difference between interest received from
earning assets and interest paid on interest bearing liabilities. It is
affected by both the volume and rates applied to both earnings assets and
liabilities, and therefore, is an effective measurement of how well management
has balanced and reacted to the Corporation's interest rate sensitive assets
and liabilities.
For the year ended December 31, 1994, the Corporation had $296.4 million
average earning assets, up $3.8 million or 1.3% from the year earlier. Average
interest bearing liabilities were $232.4 million for 1995, down $5.4 million or
2.27% from 1994. The increase in earning assets reflects the beginning of the
area's recovery from a slow, shallow recession. Liability growth has not yet
begun, and historically does trail asset growth in post-recession times. While
being mindful of the Corporation's customers' needs, management was able to
increase net interest income for 1995 to $16.0 million, up from $14.8 million
for 1994, reflecting an increase of 8.11% for 1995. This increase was due to
an increase in total earning assets of almost $5 million while interest bearing
liabilities remained static, combined with the stronger yield described in the
next paragraph.
The yield on interest earning assets was 8.38% in 1995, up from 7.53% in
1994. Cost of funds increased, to 3.72% from 3.01% in 1994. Management
continued to stress the cost and size control of liabilities during 1995, and
therefore the net yield increased to 4.66% from 4.52% in 1994. Net interest
income as a percentage of earning assets (net interest rate margin) rose to
5.41% from 5.08%, as the $1,275,000 increase in net interest income was derived
from successfully managing the changing interest rate environment during the
year, in conjunction with the previously mentioned increase in total earning
assets. Management believes these results are an indication that its interest
rate sensitivity planning is functioning well.
The provision for loan losses in 1995 was $1,031,000, up $332,000 from
1994. The loan loss reserve as of December 31, 1995 was $2.3 million, or 1.08%
of loans outstanding at year end 1995. This ratio is slightly higher than that
of 1994 (1.04%). The cause for the increase of this ratio is due to the
following: Charge-offs rose to $1,229,000 in 1995 from $1,011,000 in 1994,
recoveries of loans charged off increased to $254,000 in 1995 from $237,000 in
1994 along with a decrease in the loan portfolio. Management believes its
ability to properly manage the loan portfolio and current loan loss policies
are effective.
The Corporation's investment portfolio book value fell to $70.5 million at
December 31, 1995 from $71.1 million at December 31, 1994, reflecting a
decrease of .84%. Net loans fell to $207.8 million at December 31, 1995 from
$208.5 million at December 31, 1995, giving a decrease of .34%.
Other income for 1995 increased to $3.4 million from $3.3 million,
reflecting an increase of $125,000 or 3.8%. Service charges on deposit
accounts was up $42,000 to $1,604,000. Net gain on sale of mortgage loans
declined to $40,000 from $113,000 due to the slowing of the real estate market
and prior years refinancing when rates were lower. Other operating income for
1995 rose to $678,000 from $657,000 reflecting an increase of $21,000.
Operating expenses totaled $12.7 million, up 5.5% from $12.0 million in
1994. Opening a new branch was the main cause of the increase along with a
refund of FDIC insurance.
The rate of return on average assets and the rate of return on average
equity are a good measure of the Corporation's results. For the year 1995,
return on average assets rose to 1.26% from 1.18%. Return on average equity
was 10.88% in 1995 compared to 11.21% in 1994. Management believes these
results indicate the Corporation remains quite healthy. The slight decline in
return on equity is due to the rapid growth of the Corporation's capital and is
an indication of the Corporation's financial strength.
Accounting Standards
In October 1995, the Financial Accounting Standards Board issued Statement of
Accounting Standards (SFAS) No. 123, Accounting for Stock-Based Compensation
which encourages, but does not require, companies to use a fair value based
method of determining compensation cost for grants of stock options under
stock-based employee compensation plans. Under Accounting Principals Board
Opinion No. 25 (Opinion 25), currently utilized by the Company, compensation
cost is the excess, if any, of the quoted market price of the stock at the date
of grant over the amount employees must pay to acquire it. Companies electing
to continue accounting under these plans under the provisions of Opinion 25
will be required to present pro forma disclosures of net income and net income
per share, as if a fair value based method had been applied. The Company is
required to implement SFAS 123 on January 1, 1996. Currently the Company does
not have any plans that would fall under this standard.
In May 1995, the Financial Accounting Standards Board issued Statement of
Accounting Standards (SFAS) No. 122, Accounting for Mortgage Servicing Rights.
SFAS 122 requires the Company to recognize as separate assets rights to service
mortgage loans for others, however those servicing rights are acquired and also
requires the Company to assess its capitalized mortgage servicing rights for
impairment based on the fair value of those rights. SFAS 122 must be adopted
on January 1, 1996 on a prospective basis. Management does not believe the
adoption of SFAS 122 will have a material impact on the Company's financial
condition or results of operations due to the level of historical and
anticipated sales of loans to the secondary market with servicing retained.
Item 8. Financial Statements and Supplementary Data
(Supplementary data has been omitted because it is not applicable)
Financial statements, together with a report thereon of KPMG Peat Marwick LLP
dated January 26, 1996 appearing on Page 6 of the 1995 Annual Report to
Stockholders are incorporated herein by reference. A reference index to the
consolidated financial statements and accompanying notes presented in the
Annual Report to Stockholders is shown in Item 14 of this filing.
Item 9. Change in and Disagreements with Accountants on Accounting on
Financial Disclosure
NONE
PART III
Item 10. Directors and Executive Officers
(a) Directors
The information with respect to the directors of the Corporation, which is
required to be included herein pursuant to Item 401 of Regulation S-K, is
included under the caption "Election of Directors" on pages 3 and 4 of the
Proxy Statement, dated February 23, 1996, and is incorporated herein from the
Proxy Statement by reference. There are no arrangements or understandings
between any director and any other person pursuant to which the director was
selected.
(b) Executive Officers
The name, age and position of the executive officer of the Corporation as
of December 31, 1995, is set forth on page 6 of the Proxy Statement dated
February 23, 1996 under the caption "Principal Officers" and is incorporated
herein by reference. Officers are generally elected annually by the Board of
Directors at the meeting of directors immediately following the annual meeting
of stockholders. The disclosure of family relationships between the executive
officer and directors of the Corporation is set forth on page 4 of the Proxy
Statement dated February 23, 1996 and is incorporated herein by reference.
There are no arrangements or understandings between the executive officer and
any other person pursuant to which the executive officer was selected.
No Director or executive officer of the Corporation has received any
remuneration from the Bank or the Corporation in his capacity as a director or
executive officer of the Corporation.
The executive officer of the Corporation has been an officer of the Bank
for five years or more.
Directors and the executive officer as a group beneficially owned 15,264
shares or 9.47% of the shares outstanding. Shares owned directly total 13,964
and shares held by directors, executive officer, or their spouses in a
fiduciary capacity or by their spouses individually total 1,300.
(c) Significant Employees
Not applicable
(d) Family Relationship
Disclosed in Item 10 (a) - Directors
(e) Business Experience
Disclosed in Item 10 (a) and 10 (b)
(f) None
(g) None
Item 11. Executive Compensation
(a) Cash Compensation
The information required to be included herein regarding executive compensation
pursuant to Item 402 of Regulation S-K is included under the caption "Executive
Compensation" in registrants definitive proxy statement on page 6 and is
incorporated herein by reference.
During the year ended December 31, 1995, officers of the Corporation did not
receive any compensation from the Corporation for services rendered in such
capacity. All of the above compensation was paid by the Bank for services
rendered in the course of their employment with the bank.
(b) Compensation Pursuant to Plans
The Bank has a non-contributory, profit sharing plan covering substantially all
full-time employees who have completed one year of service, subject to a
minimum number of hours of service with the Bank. Contributions to the profit
sharing plan by the Bank are allocated among eligible participants in the
proportion that each participant's "points" for the calendar year bear to the
total "points" awarded for the calendar year. Participants are awarded one
point for each full calendar year of employment and one point for each $100 of
compensation paid such participant during that year. Voluntary contributions
may be made and invested in a separate "Voluntary Account" in which the
participant is always fully vested. Participants become fully-vested with non-
contributory allocations upon: reaching the age of 65, disability, death, or
7 years of service as defined by the plan. If employment is otherwise
terminated, partial vesting will be accorded depending upon the participant's
years of service. Retirement and death benefits may be distributed in a cash
lump sum or a series of equal installments, payable at least annually, over a
period selected by the Profit Sharing Plan Committee. The amounts contributed
to the profit sharing plan by the Bank in 1993, 1994, and 1995 were $630,000,
$640,000, and $639,000 respectively.
The Corporation has an Employee Stock Ownership Plan (ESOP) for employees of
its wholly-owned subsidiary, and executive officers are members of the plan.
Contributions to the ESOP are allocated among eligible participants in the
proportion that each participant's gross compensation bears to total
compensation of all participants. Contributions to the plan for 1993, 1994,
and 1995 were $47,000, $33,900, and $46,000 respectively.
The Corporation has an incentive stock plan for senior management of the
Corporation. Annual contributions are made based on performance factors
established by the board of directors. The Corporation has accrued a liability
of $595,000 as of December 31, 1995 representing its obligation under the plan.
Expenses of the plan amounted to $155,000, $115,000, and $105,000 for the
years ended December 31, 1995, 1994 and 1993 and were paid by the Bank.
The following table sets forth the amount of profit sharing benefits set aside
or accrued by the Bank, directly or indirectly, under the Profit Sharing Plan
for the year ended December 31, 1995 for all executive officers of the Bank.
Amount Set Aside
or Accrued for Cumulative
Name of the Year Ended Accrued
Individual December 31, 1995 Benefit
- ------------------------------------------------------------------------
George W. Hamlin, IV $22,334 $678,204
The following table sets forth the amount of ESOP benefits set aside or accrued
by the Bank, directly or indirectly, under the ESOP for the year ended December
31, 1995 for all executive officers of the Bank.
Amount Set Aside
or Accrued for Cumulative
Name of the Year Ended Accrued
Individual December 31, 1995 Benefit
- --------------------------------------------------------------------------
George W. Hamlin, IV $ 1,606 $ 16,921
(c) Other Compensation - Option/SAR Grants Table
The information required to be included herein regarding executive compensation
pursuant to Item 402 of Regulation S-K is included under the caption "Executive
Compensation" in registrants definitive proxy statement on page 7 and is
incorporated herein by reference.
(d) Aggregated Option/SAR Exercises and Fiscal Year-End Option/SAR Value
Table
The information required to be included herein regarding executive compensation
pursuant to Item 402 of Regulation S-K is included under the caption "Executive
Compensation" in registrants definitive proxy statement on page 6 and is
incorporated herein by reference.
(e) Long-Term Incentive Plan Awards Table
NONE
(f) Defined Benefit or Actuarial Plan Disclosure
NONE
(g) Compensation of Directors
For the years 1995, 1994, and 1993 no compensation was paid to members of the
Board of Directors of Canandaigua National Corporation. For the years of 1995,
1994, and 1993 members of the Board of Directors of The Canandaigua National
Bank and Trust Company were compensated at the rate of $300 per meeting.
(h) Employment Contracts and Termination of Employment and Change-In-
Control Arrangements
NONE
(i) Report on Repricing of Options/SARS
NONE
(j) Compensation Committee Interlocks
NONE
(k) Board Compensation Committee Report on Executive Compensation
The information required to be set forth for this item is set forth in
Registrant's definitive proxy statement at page 7 and incorporated herein by
reference.
(l) Performance Graph
The information required to be set forth for this item is set forth in
Registrant's definitive proxy statement at page 8 and incorporated herein by
reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management
(a), (b) The information required by Item 403 (a) and (b) of Regulation S-K is
included with the information given on pages 1 through 3 of the Proxy
Statement and is incorporated herein by reference.
(c) Changes in Control
NONE
Item 13. Certain Relationships and Related Transactions
(a) Transactions with Management and Others
NONE
(b) Certain Business Relationships
NONE
(c) Indebtedness of Management
Certain directors and executive officers of the Corporation and the Bank and
their associates were customers of and had transactions with the Bank in the
ordinary course of the Bank's business during 1995. All outstanding loans and
commitments included in such transactions were made on substantially the same
terms, including interest rates and collateral, as those prevailing at the time
for comparable transactions with others, and in the opinion of the Bank, did
not involve more than a normal risk of collectibility or present other
unfavorable features.
(d) Transactions with Promoters
Not applicable
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) 1. Financial Statements
The following consolidated financial statements of Canandaigua National
Corporation and subsidiary have been incorporated by reference in Item 8 on
Page 26: Pages*
Independent Auditors' Report 6
Consolidated Balance Sheets As of December 31, 1995 and 1994 7
Consolidated Statements of Income For Each of the Years in the 3-Year
Period ended December 31, 1995 8
Consolidated Statements of Changes In Stockholders' Equity for Each
of the Years in the 3-Year Period ended December 31, 1995 9
Consolidated Statements of Cash Flows For Each of the Years in the
3-Year Period ended December 31, 1995 ...........................10
Notes to Consolidated Financial Statements......................... 10-25
* 1995 Annual Report to Stockholders
(a) 2. Financial Statement Schedules
Schedules are omitted since the required information is either not applicable,
not deemed material, or is shown elsewhere in the financial statements or notes
thereto.
(a) 3. Exhibits Table
(11) The information required by Item 601(a)(3)(11) of Regulation S-K is set
forth on page 7 and 13 of the 1995 Annual Report to the Stockholders and is
incorporated herein by reference.
(13) A copy of the 1995 Annual Report to Stockholders is attached hereto as
Exhibit A.
(19) A copy of the definitive proxy statement mailed to Stockholders is
attached hereto as Exhibit B.
(22)The Canandaigua National Bank and Trust Company is the only wholly owned
subsidiary of Registrant. The Bank is incorporated under the laws of The
United States of America. Registrant owns one-third of the common stock of
Greater Funding of New York, Inc. a New York State licensed mortgage company.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
CANANDAIGUA NATIONAL CORPORATION
By:
George W. Hamlin, IV
President
Date: 3/24/95
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.
Signature Title Date
George W. Hamlin, IV President/Director April 1, 1996
George W. Hamlin, IV
Robert G. Sheridan Secretary/Director April 1, 1996
Robert G. Sheridan
Gregory S. MacKay Treasurer April 1, 1996
Gregory S. MacKay
Director
Patricia Boland
Frank H. Hamlin Director April 1, 1996
Frank H. Hamlin
Stephen D. Hamlin Director April 1, 1996
Stephen D. Hamlin
Paul r. Kellogg Director April 1, 1996
Paul R. Kellogg
Director
Eldred M. Sale
Director
Caroline C. Shipley
Alan J. Stone Director April 1, 1996
Alan J. Stone
Director
David Hamlin, Jr.
Director
Willis F. Weeden, MD