Attached files
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| 8-K - FORM 8-K - CNB FINANCIAL CORP/PA | d770274d8k.htm |
 Investor Meetings
August 2014
Exhibit 99.1 |
 Forward-Looking Statements
This
presentation
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
the
financial
condition,
liquidity,
results
of
operations,
future
performance
and
business
of
CNB
Financial
Corporation.
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
our
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.”
Such
known
and
unknown
risks,
uncertainties
and
other
factors
that
could
cause
the
actual
results
to
differ
materially
from
the
statements,
include,
but
are
not
limited
to:
(i)
changes
in
general
business,
industry
or
economic
conditions
or
competition;
(ii)
changes
in
any
applicable
law,
rule,
regulation,
policy,
guideline
or
practice
governing
or
affecting
financial
holding
companies
and
their
subsidiaries
or
with
respect
to
tax
or
accounting
principles
or
otherwise;
(iii)
adverse
changes
or
conditions
in
capital
and
financial
markets;
(iv)
changes
in
interest
rates;
(v)
higher
than
expected
costs
or
other
difficulties
related
to
integration
of
combined
or
merged
businesses;
(vi)
the
inability
to
realize
expected
cost
savings
or
achieve
other
anticipated
benefits
in
connection
with
business
combinations
and
other
acquisitions;
(vii)
changes
in
the
quality
or
composition
of
our
loan
and
investment
portfolios;
(viii)
adequacy
of
loan
loss
reserves;
(ix)
increased
competition;
(x)
loss
of
certain
key
officers;
(xi)
continued
relationships
with
major
customers;
(xii)
deposit
attrition;
(xiii)
rapidly
changing
technology;
(xiv)
unanticipated
regulatory
or
judicial
proceedings
and
liabilities
and
other
costs;
(xv)
changes
in
the
cost
of
funds,
demand
for
loan
products
or
demand
for
financial
services;
and
(xvi)
other
economic,
competitive,
governmental
or
technological
factors
affecting
our
operations,
markets,
products,
services
and
prices.
Such
developments
could
have
an
adverse
impact
on
our
financial
position
and
our
results
of
operations.
The
forward-looking
statements
are
based
upon
management’s
beliefs
and
assumptions.
Any
forward-looking
statement
made
herein
speaks
only
as
of
the
date
of
this
presentation.
Factors
or
events
that
could
cause
our
actual
results
to
differ
may
emerge
from
time
to
time,
and
it
is
not
possible
for
us
to
predict
all
of
them.
We
undertake
no
obligation
to
publicly
update
any
forward-looking
statement,
whether
as
a
result
of
new
information,
future
developments
or
otherwise,
except
as
may
be
required
by
law.
2 |
 CNB
Financial Overview 3
Source:
SNL
Financial
and
company
data.
Information
and
data
as
of
June
30,
2014
CNB Financial is a full-service bank,
headquartered in Clearfield, PA, providing
services, including wealth and asset
management, to individuals, businesses,
governments, and institutional customers
As of June 30, 2014:
Operates 36 branches in North Central
Pennsylvania and Ohio through its principal
subsidiary, CNB Bank
CNB Bank is a regional independent
community bank operating:
NASDAQ-listed under the symbol “CCNE”
•
Assets: $2.2 billion
•
Loans: $1.3 billion
•
Deposits: $1.9 billion
•
21 branches in North Central
Pennsylvania
•
7 full-service branches through
ERIEBANK, a division of CNB Bank
headquartered in Erie, PA
•
8 full-service branches through its
newest division FCBank,
headquartered in Bucyrus, Ohio
•
Holiday Financial Services: Consumer
loan company with 12 offices |
 Strong Balance Sheet Growth
•
Successfully closed on previously announced acquisition of FC Banc Corp. during the
fourth quarter of 2013 •
Loans of $1.3 billion at June 30, 2014 represent 33.1% growth over June 30, 2013,
comprised of 25.2% from the FC acquisition and organic growth of 7.9%
•
Deposits of $1.9 billion at June 30, 2014 represent 19.7% growth
over June 30, 2013, which is primarily
attributable to the FC Banc Corp. acquisition
Profitability
•
Net income of $10.8 million for the six months ended June 20, 2014, up 48.8% from
the first six months of 2013
•
Return on assets of 1.01% and return on equity of 12.28%, as compared to 0.80% and
10.04% at June 30, 2013
•
Net interest margin of 3.79%, up from 3.39% at June 30, 2013
Superior Asset Quality
•
Nonperforming assets to total assets of 0.62%
•
Net charge-offs to average loans of 0.21%
•
Allowance for loan losses to loans of 1.33%
Capital
•
Tangible common equity to tangible assets of 6.87%*
•
Leverage ratio of 8.13%
•
Tier 1 Risk Based Ratio of 12.83%
•
Total Risk Based Capital Ratio of 14.07%
Financial Highlights –
YTD 2014
4
Note: Financial data as of or for the six months ended June 30, 2014
*Please see the Appendix for a reconciliation of non-GAAP financial
information. |
 2014
Initiatives Opened a CNB Bank loan production office in Blair County, PA
in April
Opened a FCBank full-service branch in Dublin, OH in July
Construction of new ERIEBANK full-service branch in Erie, PA
that is scheduled to open prior to the end of 2014 |
 History of CNB Financial
6
1865
1934
1984
2005
2006
2008
2009
2010
2013
1865:
County
National Bank
of Clearfield
established
1934:
Reorganizes
through a stock
offering to existing
depositors
1984:
Forms
CNB
Financial Corporation
holding company
2005:
ERIEBANK is
formed
2005:
Purchases
assets
of Holiday Consumer
Discount Company and
forms Holiday Financial
Services Corporation
2006:
Conversion
to a state banking
charter
2010:
Joseph
Bower
becomes CEO after
retirement of William
Falger
2008-2009:
Receives
approval to raise $21
million via TARP;
CNB chooses not to
participate
2010:
Capital
raise of $34.5
million
2013:
Acquisition of
FC Banc Corp.
headquartered
in Bucyrus,
Ohio with $360
million in
assets |
 ERIEBANK, a division of CNB Bank, was created de novo in 2005
7
At June 30, 2014:
Seven branches
$396 million in loans
$603 million in deposits |
 Expansion into Ohio
•
The acquisition of FC Banc Corp., which closed in the
fourth quarter of 2013, expanded CNB’s geographic
footprint into Central Ohio with meaningful size and
scale
–
Entry into 5 new markets, similar to those that CNB currently serves, with
dominant market share position
–
$360 million in total assets; $248 million in loans; and $332 million in deposits
as of October 11, 2013
•
Opportunity to replicate CNB’s already successful ERIEBANK model in a market
conducive to CNB’s business plan
•
Significant opportunity for both organic and strategic growth going forward
•
Significant
accretion
to
EPS
expected
in
the
first
full
combined
year
without
significant
TBV
dilution
–
5.4%
EPS
accretion
expected
in
first
full
year
with
TBV
dilution
earned
back
by
the
end
of 2014
8 |
 CNB’s Experienced Management Team
Years at
Years in
Executive
Title
CCNE
Industry
Joseph B. Bower Jr.
President & Chief Executive Officer
17
21
Richard L. Greslick Jr.
EVP / Chief Operating Officer & Secretary
16
16
Joseph E. Dell Jr.
SVP / Chief Lending Officer
1
30
Mark D. Breakey
EVP / Chief Credit Officer
23
29
Brian W. Wingard
SVP / Chief Financial Officer & Treasurer
6
6
Vincent C. Turiano
SVP / Operations
5
41
Leanne D. Kasseb
SVP / Marketing
18
20
Mary Ann Conaway
SVP / Human Resources
32
32
David J. Zimmer
President of ERIEBANK
9
30
J. Andrew Dale
President of FC Bank
1
27
9 |
 CNB
Stock Price Performance Since its follow-on offering in 2010, CNB has
outperformed the NASDAQ Bank Index
Source: SNL Financial. Price change from 6/14/10 to 7/15/14
10 |
 Strong Organic Loan and Deposit Growth
11
Strong organic loan and deposit growth
through the financial crisis and recession
Fundamental focus on originating loans
in-market and funding with local, low-cost
core deposits while maintaining asset
quality
The Bank strives to be more customer-
driven than its competitors and builds
long-term customer relationships by
being reliable and competitively priced
Loans and deposits at June 30, 2014 are
relatively flat compared to year-end 2013
Loan and deposit growth for the first six
months of 2014 was 2.35% and 1.81%,
respectively, within CNB’s historical
markets
Loans and deposits acquired from FC
Banc Corp. have run off 4.81% and
3.55%, respectively, since December 31,
2013, within our expectations
During the next 12 months, CNB
anticipates moderate loan and deposit
growth across all of its markets
Total Loans
Total Deposits |
 0
0
0
0
Residential
Mortgage
36.4%
Commercial
Real Estate
26.1%
C&I
32.2%
Consumer
5.3%
6/30/14
Diversified Loan Portfolio
0
0
0.00
0
Residential
Mortgage
33.2%
Commercial
Real Estate
26.8%
C&I
32.4%
Consumer
7.6%
12/31/10
$795 million
6.43% yield
$1.3 billion
5.31% yield
12 |
 0
0
0.00
0
Non-
interest
Bearing
12.2%
MMDA &
Savings
77.0%
Retail CDs
6.2%
Jumbo CDs
4.6%
6/30/14
Attractive Deposit Mix
$1.2 billion
1.42% cost of deposits
$1.9 billion
0.52% cost of deposits
0
0
0.00
0
Non-
interest
Bearing
12.1%
MMDA &
Savings
56.1%
Retail CDs
17.5%
Jumbo CDs
14.2%
12/31/10
13 |
 Deposit Market Share
Source: SNL Financial. Deposit market share as of June 30, 2013
CNB Growth
Market Growth
Market
Rank
# of
Branches
CNB
Deposits
($000)
CNB
Deposit
Market
Share (%)
Year
over
Year (%)
5-Year
CAGR
(%)
Total
Deposits in
Market
($000)
Year over
Year (%)
5-Year
CAGR (%)
Clearfield, PA
1
11
449,038
33.96
3.26
2.52
1,322,107
0.06
0.19
Erie, PA
5
4
426,736
10.09
6.13
51.94
4,228,343
3.57
5.56
Elk, PA
2
4
165,653
24.09
3.34
11.21
687,547
2.05
1.29
Crawford, OH
2
2
132,660
17.81
6.93
5.52
744,874
0.46
1.20
Crawford, PA
5
2
124,153
10.17
39.24
-
1,220,579
4.25
2.68
Mc Kean, PA
3
3
122,177
14.73
3.55
10.75
829,566
2.69
4.91
Franklin, OH
17
2
111,671
0.26
0.47
23.97
42,412,438
6.91
10.37
Centre, PA
9
1
84,641
3.16
7.94
11.64
2,680,576
7.21
7.26
Jefferson, PA
5
1
60,432
6.79
0.54
11.50
890,119
(1.18)
1.29
Warren, PA
4
1
59,694
7.03
(3.01)
33.49
848,819
5.83
4.70
Cambria, PA
10
1
51,717
1.87
0.87
6.33
2,770,851
(0.21)
2.47
Knox, OH
6
1
36,705
4.98
5.30
12.63
736,557
2.55
3.39
Morrow, OH
4
1
32,294
16.34
1.23
7.16
197,582
3.78
2.29
Richland, OH
13
1
10,753
0.63
10.32
-
1,705,766
(2.10)
1.43
Holmes, OH
9
1
2,880
0.39
-
-
730,505
3.50
6.27
Indiana, PA
9
1
2,645
0.11
-
-
2,436,997
20.10
4.62
Total
37
1,873,849
2.91
6.02
14.83
64,443,226
5.93
7.82
14 |
 Improved Profitability
* Note 2013 full year net income includes one-time merger costs related to the
acquisition of FC Banc Corp
15
0
0
0
0
$5,235
$8,512
$11,316
$15,104
$17,136
$16,679
$10,783
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y*
2014 YTD
Net Income
5-Year
CAGR
+27.7%
0
0
0
0
0.55
0.79
0.87
1.00
1.00
0.88
1.01
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y
2014 YTD
ROAA
0
0
0
0
$0.61
$0.98
$1.06
$1.23
$1.38
$1.29
$0.75
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y*
2014 YTD
Diluted EPS
5-Year
CAGR
+16.2%
0
0
0
0
64.83
59.91
58.54
54.96
53.67
58.19
58.16
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y
2014 YTD
Efficiency Ratio |
 Stable Net Interest Margin
16
0
0
0
0
4.33
4.00
3.65
3.59
3.49
3.47
3.79
6.74
5.86
5.22
4.80
4.35
4.15
4.40
2.64
2.07
1.78
1.44
1.08
0.79
0.71
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y
2014 YTD
Net Interest Margin
Yield on Interest Earning Assets
Cost of Interest Bearing Liabilities |
  Superior Asset Quality
Source: SNL Financial. NPAs excluded restructured loans. Texas ratio defined as NPA
& Loans 90+/ Tangible Common Equity* + Allowance for Loan Losses.
* Please see the Appendix for a reconciliation of non-GAAP financial
information 17
0
0
0
0
0.42
1.17
0.93
1.09
0.85
0.62
0.62
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y
Jun-14
NPAs/Assets
0
0
0
0
0.28
0.49
0.56
0.38
0.55
0.38
0.21
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y
2014 YTD
NCOs/Average Loans
0
0
0
0
1.29
1.37
1.35
1.48
1.51
1.25
1.33
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y
Jun-14
Allowance for Loan Losses/
Gross Loans
0
0
0
0
7.06
20.30
14.82
18.85
16.90
8.64
8.18
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y
Jun-14
Texas Ratio |
  Strong
Capital Levels 18
* Please see the Appendix for a reconciliation of non-GAAP financial
information. 0
0
0
0
5.12
5.08
7.05
7.61
7.63
6.34
6.87
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y
Jun-14
Tangible Common
Equity/Tangible Assets*
0
0
0
0
8.40
7.87
8.81
8.22
8.06
7.96
8.13
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y
Jun-14
Leverage Ratio
0
0
0
0
10.80
10.70
14.13
13.89
14.03
12.51
12.83
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y
Jun-14
Tier 1 Risk Based Ratio
0
0
0
0
12.00
11.95
15.38
15.14
15.28
13.72
14.07
2008Y
2009Y
2010Y
2011Y
2012Y
2013Y
Jun-14
Total Risk Based Ratio |
 CNB’s Growth Strategy
Organic / De Novo Growth Strategy
Acquisition Strategy
Expand our presence into new
markets that fit our business
model (i.e. FCBank)
Bring significant talent
19
FCBank market provides for organic
growth through new offices and
additional lenders
ERIEBANK growth continues to be
strong
Continue to open loan production
offices to fill-in our markets
M&A is not a priority in our growth
strategy; however, we will remain
opportunistic and would consider a
transaction that would: |
 Appendix
20 |
 Non-GAAP Financial Reconciliation
Tangible
common
equity
to
tangible
assets
is
a
non-GAAP
financial
measure
calculated
using
GAAP
amounts.
Tangible
common
equity
is
calculated
by
excluding
the
balance
of
goodwill
and
other
intangible
assets
from
the
calculation
of
shareholders’
equity.
Tangible
assets
is
calculated
by
excluding
the
balance
of
goodwill
and
other
intangible
assets
from
the
calculation
of
total
assets.
CNB
believes
that
this
non-GAAP
financial
measure
provides
information
to
investors
that
is
useful
in
understanding
our
financial
condition.
Because
not
all
companies
use
the
same
calculations
of
tangible
common
equity
and
tangible
assets,
this
presentation
may
not
be
comparable
to
other
similarly
titled
measures
calculated
by
other
companies.
A
reconciliation
of
this
non-GAAP
financial
measure
is
provided
below.
21
Year ended December 31,
($ in thousands)
2008
2009
2010
2011
2012
2013
June 30, 2014
Total Shareholders' Equity
$62,467
$69,409
$109,645
$131,889
$145,364
$164,911
$177,186
Less Goodwill
10,821
10,821
10,821
10,821
10,946
27,194
27,194
Less Other Intangible Assets
185
85
-
-
-
4,583
3,979
Tangible Common Equity
$51,461
$58,503
$98,824
$121,068
$134,418
$133,134
$146,013
Total Assets
$1,016,518
$1,161,591
$1,413,511
$1,602,207
$1,773,079
$2,131,289
$2,156,665
Less Goodwill
10,821
10,821
10,821
10,821
10,946
27,194
27,194
Less Other Intangible Assets
185
85
-
-
-
4,583
3,979
Tangible Assets
$1,005,512
$1,150,685
$1,402,690
$1,591,386
$1,762,133
$2,099,512
$2,125,492
Total Shareholders' Equity / Total Assets
6.15%
5.98%
7.76%
8.23%
8.20%
7.74%
8.22%
Tangible Common Equity / Tangible Assets
5.12%
5.08%
7.05%
7.61%
7.63%
6.34%
6.87% |