CITIZENS & NORTHERN CORP - FORM 8-K - EX-99.3 - EXHIBIT 99.3 - April 14, 2015

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8-K - 8-K - CITIZENS & NORTHERN CORPv407290_8k.htm
EX-99.1 - EXHIBIT 99.1 - CITIZENS & NORTHERN CORPv407290_ex99-1.htm
EX-99.2 - EXHIBIT 99.2 - CITIZENS & NORTHERN CORPv407290_ex99-2.htm

EXHIBIT 99.3 – Supplemental, Unaudited Financial Information

 

 

AVAILABLE-FOR-SALE SECURITIES  March 31, 2015   December 31, 2014 
(In Thousands)  Amortized   Fair   Amortized   Fair 
   Cost   Value   Cost   Value 
                 
Obligations of U.S. Government agencies  $27,205   $27,025   $27,221   $26,676 
Obligations of states and political subdivisions:                    
Tax-exempt   117,378    122,502    120,086    124,839 
Taxable   36,861    37,417    33,637    33,878 
Mortgage-backed securities   90,130    92,088    82,479    83,903 
Collateralized mortgage obligations,                    
Issued by U.S. Government agencies   238,794    240,077    239,620    238,823 
Other collateralized debt obligations   34    34    34    34 
Total debt securities   510,402    519,143    503,077    508,153 
Marketable equity securities   5,636    8,671    5,605    8,654 
Total  $516,038   $527,814   $508,682   $516,807 

 

Summary of Loans by Type            
(Excludes Loans Held for Sale)            
(In Thousands)  March 31,   Dec. 31,   March 31, 
   2015   2014   2014 
Residential mortgage:               
Residential mortgage loans - first liens  $291,612   $291,882   $295,869 
Residential mortgage loans - junior liens   20,896    21,166    23,048 
Home equity lines of credit   37,049    36,629    34,755 
1-4 Family residential construction   16,217    16,739    12,635 
Total residential mortgage   365,774    366,416    366,307 
Commercial:               
Commercial loans secured by real estate   140,851    145,878    146,569 
Commercial and industrial   51,563    50,157    40,477 
Political subdivisions   19,479    17,534    10,436 
Commercial construction and land   7,249    6,938    14,692 
Loans secured by farmland   7,789    7,916    8,602 
Multi-family (5 or more) residential   8,673    8,917    10,906 
Agricultural loans   3,158    3,221    3,159 
Other commercial loans   13,187    13,334    14,343 
Total commercial   251,949    253,895    249,184 
Consumer   10,622    10,234    10,327 
Total   628,345    630,545    625,818 
Less: allowance for loan losses   (7,134)   (7,336)   (8,343)
Loans, net  $621,211   $623,209   $617,475 
                
Loans Held for Sale               
(In Thousands)  March 31,   Dec. 31,   March 31, 
   2015   2014   2014 
Residential mortgage loans originated               
and serviced - outstanding balance  $151,486   $152,505   $147,524 
Less: outstanding balance of loans sold   (151,272)   (152,505)   (147,391)
Loans held for sale, net  $214   $0   $133 

 

 
 

 

ANALYSIS OF THE ALLOWANCE FOR LOAN LOSSES                
(In Thousands)                
   3 Months   3 Months   Year   3 Months 
   Ended   Ended   Ended   Ended 
   March 31,   Dec. 31,   Dec. 31,   March 31, 
   2015   2014   2014   2014 
Balance, beginning of period  $7,336   $7,449   $8,663   $8,663 
Charge-offs   (222)   (258)   (2,139)   (274)
Recoveries   17    22    336    265 
Net charge-offs   (205)   (236)   (1,803)   (9)
Provision (credit) for loan losses   3    123    476    (311)
Balance, end of period  $7,134   $7,336   $7,336   $8,343 

 

PAST DUE AND IMPAIRED LOANS, NONPERFORMING ASSETS 
AND TROUBLED DEBT RESTRUCTURINGS (TDRs) 
(In Thousands) 
   March 31,   Dec 31,   March 31, 
   2015   2014   2014 
Impaired loans with a valuation allowance  $4,312   $3,241   $9,576 
Impaired loans without a valuation allowance   8,851    9,075    5,430 
Total impaired loans  $13,163   $12,316   $15,006 
                
Total loans past due 30-89 days and still accruing  $5,722   $7,121   $7,650 
                
Nonperforming assets:               
Total nonaccrual loans  $11,944   $12,610   $14,257 
Total loans past due 90 days or more and still accruing   3,086    2,843    2,160 
Total nonperforming loans   15,030    15,453    16,417 
Foreclosed assets held for sale (real estate)   1,583    1,189    1,321 
Total nonperforming assets  $16,613   $16,642   $17,738 
                
Loans subject to troubled debt restructurings (TDRs):               
Performing  $1,872   $1,807   $3,020 
Nonperforming   5,252    5,388    112 
Total TDRs  $7,124   $7,195   $3,132 
                
Total nonperforming loans as a % of loans   2.39%   2.45%   2.62%
Total nonperforming assets as a % of assets   1.33%   1.34%   1.44%
Allowance for loan losses as a % of total loans   1.14%   1.16%   1.33%
Allowance for loan losses as a % of nonperforming loans   47.47%   47.47%   50.82%

 

 
 

 

Analysis of Average Daily Balances and Rates 
(Dollars in Thousands) 
   3 Months       3 Months       3 Months     
   Ended   Rate of   Ended   Rate of   Ended   Rate of 
   3/31/2015   Return/   12/31/2014   Return/   3/31/2014   Return/ 
   Average   Cost of   Average   Cost of   Average   Cost of 
   Balance   Funds %   Balance   Funds %   Balance   Funds % 
EARNING ASSETS                              
Available-for-sale securities,                              
at amortized cost:                              
Taxable  $388,104    2.15%  $383,802    2.10%  $345,663    2.22%
Tax-exempt  $117,674    5.35%   121,735    5.22%   126,030    5.45%
Total available-for-sale securities   505,778    2.90%   505,537    2.85%   471,693    3.08%
Interest-bearing due from banks   26,994    0.39%   31,655    0.39%   30,099    0.40%
Loans held for sale   89    9.11%   151    7.88%   119    10.22%
Loans receivable:                              
Taxable   582,498    5.37%   587,675    5.40%   595,514    5.45%
Tax-exempt   41,925    5.15%   39,909    5.28%   39,662    5.82%
Total loans receivable   624,423    5.35%   627,584    5.40%   635,176    5.47%
Total Earning Assets   1,157,284    4.16%   1,164,927    4.16%   1,137,087    4.35%
Cash   16,127         16,310         16,299      
Unrealized gain/loss on securities   10,626         8,222         2,752      
Allowance for loan losses   (7,391)        (7,476)        (8,780)     
Bank premises and equipment   16,252         16,415         17,283      
Intangible Asset - Core Deposit Intangible   50         58         83      
Intangible Asset - Goodwill   11,942         11,942         11,942      
Other assets   37,135         38,442         42,326      
Total Assets  $1,242,025        $1,248,840        $1,218,992      
                               
INTEREST-BEARING LIABILITIES                              
Interest-bearing deposits:                              
Interest checking  $191,705    0.12%  $190,681    0.11%  $179,617    0.12%
Money market   194,834    0.15%   198,999    0.14%   195,596    0.14%
Savings   127,853    0.10%   122,955    0.10%   118,529    0.10%
Certificates of deposit   122,007    0.71%   128,750    0.73%   134,833    0.87%
Individual Retirement Accounts   113,806    0.40%   116,672    0.40%   122,389    0.38%
Other time deposits   803    0.00%   677    0.59%   812    0.00%
Total interest-bearing deposits   751,008    0.26%   758,734    0.27%   751,776    0.30%
Borrowed funds:                              
Short-term   6,017    0.07%   6,886    0.12%   10,049    0.20%
Long-term   73,020    4.03%   73,092    4.03%   73,300    4.03%
Total borrowed funds   79,037    3.73%   79,978    3.69%   83,349    3.57%
Total Interest-bearing Liabilities   830,045    0.59%   838,712    0.59%   835,125    0.63%
Demand deposits   215,019         213,230         193,402      
Other liabilities   8,120         9,144         8,158      
Total Liabilities   1,053,184         1,061,086         1,036,685      
Stockholders' equity, excluding accumulated                              
other comprehensive income/loss   181,944         182,336         180,440      
Accumulated other comprehensive income/loss   6,897         5,418         1,867      
Total Stockholders' Equity   188,841         187,754         182,307      
Total Liabilities and Stockholders' Equity  $1,242,025        $1,248,840        $1,218,992      
Interest Rate Spread        3.57%        3.57%        3.72%
Net Interest Income/Earning Assets        3.74%        3.73%        3.89%
                               
Total Deposits (Interest-bearing                              
and Demand)  $966,027        $971,964        $945,178      

 

(1) Changes in income on tax-exempt securities and loans are presented on a fully tax-equivalent basis, using the Corporation’s marginal federal income tax rate of 35%.

(2) Nonaccrual loans have been included with loans for the purpose of analyzing net interest earnings.

 

 
 

 

COMPARISON OF NONINTEREST INCOME 
(In Thousands)  Three Months Ended 
   March 31,   Dec. 31,   March 31, 
   2015   2014   2014 
Service charges on deposit accounts  $1,022   $1,213   $1,223 
Service charges and fees   113    133    127 
Trust and financial management revenue   1,114    1,165    1,047 
Brokerage revenue   219    219    227 
Insurance commissions, fees and premiums   40    15    32 
Interchange revenue from debit card transactions   474    485    453 
Net gains from sales of loans   147    211    151 
(Decrease) increase in fair value of servicing rights   (117)   (62)   105 
Increase in cash surrender value of life insurance   97    98    88 
Other operating income   378    325    298 
Total noninterest income, before realized gains               
on available-for-sale securities, net  $3,487   $3,802   $3,751 
                
COMPARISON OF NONINTEREST EXPENSE     
(In Thousands)  Three Months Ended 
   March 31,   Dec. 31,   March 31, 
   2015   2014   2014 
Salaries and wages  $3,487   $3,562   $3,565 
Pensions and other employee benefits   1,385    1,206    1,319 
Occupancy expense, net   722    626    715 
Furniture and equipment expense   454    460    472 
FDIC assessments   151    156    147 
Pennsylvania shares tax   249    336    341 
Professional fees   122    272    148 
Automated teller machine and interchange expense   246    256    211 
Software subscriptions   197    209    190 
Other operating expense   1,451    1,167    1,416 
Total noninterest expense  $8,464   $8,250   $8,524 

 

 

 

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