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Commercial National Financial Corporation Reports Q2 2024 Results

Posted on by darion

ITHACA, Mich., July 26, 2024 (GLOBE NEWSWIRE) — Commercial National Financial Corporation (Pink Sheets: CEFC) reported second quarter 2024 net income of $1,412,000, or $0.36 per share, compared to second quarter 2023 net income of $1,543,000, or $0.39 per share. Return on equity (ROE) was 11.96% for second quarter 2024 compared to 14.44% for second quarter 2023.

Net interest income for the second quarter of 2024 increased slightly by $38,000, or 0.8%, compared to the corresponding period in 2023. Interest income increased by $430,000 due to higher yields on loans and other interest-bearing assets as the federal funds rate was higher during the current period. The higher federal funds rate, as well as a noticeable shift among customers from lower-interest deposit accounts to higher-interest checking and time deposit accounts, resulted in an increase in interest expense of $392,000. Noninterest income increased by $99,000, or 19.1%, primarily due to higher interchange and other miscellaneous income. Operating expenses increased by $366,000, or 11.5%, primarily due to higher payroll and benefit costs.

Total assets were $572.7 million at June 30, 2024, compared to $587.9 million at June 30, 2023. The decrease in assets was driven by the repayment of wholesale loans and senior trust debt, along with a 1.4% decrease in deposit balances. The securities portfolio decreased by $12.4 million as proceeds from expired securities were used to repay wholesale loans. While total loans decreased by $9.1 million, or 2.2%, loan quality remained strong with a non-performing asset ratio of 0.22%. Additionally, CEFC’s wholly owned subsidiary, Commercial Bank, remains well above “well capitalized” for regulatory purposes.

We are pleased to announce that our new Grand Rapids banking office is officially open. We are excited to expand our full-service banking to the Grand Rapids community and look forward to growing our loan and deposit base in the Grand Rapids area.

Visit www.bank-Handlowy.com to read the latest press releases and other information about CEFC and Commercial Bank.

Selected financial data (unaudited):
Three months completed Six months completed
June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023
Return on Equity (ROE) 11.96 % 14.44 % 10.96 % 14.42 %
Return on assets (ROA) 0.98 % 1.04 % 0.89 % 1.01 %
Net interest margin 3.38 % 3.23 % 3.31 % 3.26 %
June 30, 2024 June 30, 2023
Non-Performing Assets Ratio 0.22 % 0.18 %
Tier 1 Leverage Capital Ratio(1) 9.98 % 9.37 %
Total Risk Based Capital Ratio(1) 16.00 % 15.22 %
Book value per share $ 12.16 $ 10.89
Market value per share $ 8.90 $ 9.30
(1) The indicators refer to the Commercial Bank
Consolidated income statements (unaudited):
Three months completed Six months completed
June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023
Net interest income $ 6 709 614 $ 6 279 754 $ 13 325 088 $ 12 355 813
Interest costs 2 131 773 1 740 142 4 255 200 3 125 557
Net interest income 4 577 841 4 539 612 9 069 888 9 230 256
Credit loss provision (79 201 ) (12,000 ) (39 201 ) 109,000
Non-interest income 613 892 515 297 1 150 984 987 801
Operation costs 3 555 700 3 189 499 7 150 718 6 460 291
Income before tax 1 715 234 1 877 410 3 109 355 3 648 766
Income tax expense 303 070 334,463 536 060 635 763
Net income $ 1 412 164 $ 1 542 947 $ 2 573 295 $ 3 013 003
Net income per share – diluted $ 0.36 $ 0.39 $ 0.65 $ 0.76
Dividends announced $ 0.14 $ 0.14 $ 0.28 $ 0.28
Consolidated balance sheets (unaudited):
June 30, 2024 June 30, 2023
Assets
cash and cash equivalents $ 47 039 228 $ 39 832 080
Term deposits in other banks 1,992,000 4,482,000
Securities 80 159 284 92,532,540
Loans 412,197,881 421,267,286
Credit loss provision (3,528,389 ) (3 868 740 )
Net loans 408,669,492 417,398,546
Rooms and equipment net 9 920 094 8 624 817
Other assets 24 949 807 25 075 126
Total assets $ 572,729,905 $ 587,945,109
Debt
Deposits $ 501,929,583 $ 508,939,164
FHLB Loans 9,000,000 19,000,000
Trust your preferred 10,310,000 13,403,000
Other obligations 3 269 872 3 422 503
Total liabilities 524,509,455 544,764,667
Right
Total equity capital 48 220 450 43,180,442
Total liabilities and equity $ 572,729,905 $ 587,945,109

Contact:
Benjamin Z. Ogle
Chief Financial Officer
989-875-5562