Commercial National Financial Corporation Reports 1st Quarter 2018 Earnings

Friday, April 20, 2018 10:00 AM UTC

ITHACA, Mich., April 20, 2018 -- Commercial National Financial Corporation (Pink Sheets:CEFC) today announced first quarter 2018 net income of $1,064,000, or $.27 per share compared to a first quarter 2017 net loss of $206,000, or $.05 per share. Excluding merger-related expenses for the merger with Capital Directions, Inc., the holding company for Mason State Bank, 2017 first quarter net income was $803,000, or $.21 per share.

Total assets were $530 million at March 31, 2018 compared to $535.9 million at March 31, 2017. Total loans were approximately flat year over year. The lending environment remains very competitive in our markets. We are continuing our efforts to increase loan volume while maintaining our credit quality standards.

For the quarter ended March 31, 2018, net interest income increased $16,000, or .4%. Increases in interest income from the higher interest rate environment were mostly offset by a higher cost of funds. The provision for loan losses decreased $16,000 due to a lower trend in historical losses. Non-interest income decreased $12,000, or 3% for the quarter ended March 31, 2018 compared to March 31, 2017 quarter primarily due to lower service charges. Operating expenses decreased by $1,665,000, or 37.9% mostly due to the absence of one-time merger-related expenses in the current quarter as well as from the realization of other cost saving opportunities.

Commercial National Financial Corporation operates through a single subsidiary bank, Commercial Bank. Visit www.commercial-bank.com to view the latest consolidated Annual Report, news releases and other information about CEFC and Commercial Bank.

Selected Financial Data (unaudited):
		Quarter Ended March 31,
		2018			2017
	Return on Equity (ROE)		13.01	%		(2.61	)%
	Return on Assets (ROA)		0.83	%		(0.16	)%
	Net Interest Margin		2.99	%		2.95	%

		March 31,
		2018			2017
	Non-performing Assets Ratio		0.50	%		0.48	%
	Tier 1 Leverage Capital⁽¹⁾		8.16	%		7.76	%
	Total Risk-based Capital⁽¹⁾		13.52	%		13.34	%
	Book Value Per Share	$	8.37		$	7.99
	Market Value Per Share	$	12.50		$	11.37
	⁽¹⁾Ratios are for Commercial Bank.

	Consolidated Statements of Income (unaudited):
		Quarter Ended March 31,
		2018			2017
	Interest Income	$	4,736,212		$	4,560,656
	Interest Expense		1,119,690			959,834
	Net Interest Income		3,616,522			3,600,822
	Provision for loan losses		-			15,814
	Non-interest income		408,066			420,523
	Operating Expenses		2,724,977			4,389,526
	Income before taxes		1,299,611			(383,995	)
	Income tax expense		236,000			(178,000	)
	Net Income	$	1,063,611		$	(205,995	)
	Net Income per share – basic	$	0.27		$	(0.05	)
	Net Income per share – diluted	$	0.27		$	(0.05	)
	Dividends declared	$	0.13		$	0.13

	Consolidated Balance Sheets (unaudited):
		March 31,
		2018			2017
	Assets
	Cash and cash equivalents	$	27,692,664		$	39,635,041
	Time deposits with other banks		50,559,000			41,293,000
	Securities		36,591,591			38,948,461
	Loans		387,682,296			387,305,804
	Allowance for loan losses		(2,672,577	)		(2,752,545	)
	Loans, net		385,009,719			384,553,259
	Bank premises and equipment		7,650,007			7,122,992
	Other assets		22,516,191			24,300,812
	Total Assets	$	530,019,172		$	535,853,565

	Liabilities
	Deposits	$	422,355,163		$	435,628,474
	Other borrowings		57,758,842			50,290,819
	Trust preferred		13,403,000			13,403,000
	Other liabilities		3,311,055			4,846,800
	Total Liabilities		496,828,060			504,169,093

	Equity
	Total Equity		33,191,112			31,684,472
	Total Liabilities and Equity	$	530,019,172		$	535,853,565

Contact:
Kevin A. Twardy
CFO and COO
989-875-5528

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Commercial National Financial Corporation Reports 1st Quarter 2018 Earnings

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