ACNB Corporation Reports 2024 Second Quarter Financial Results

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ACNB Corporation's Q2 2024 financial results are strong and show marked improvements compared to both Q1 2024 and Q2 2023. Key metrics such as net income, return on average assets and return on equity have all increased significantly. The net income of $11.3 million and earnings per share of $1.32 reflect the company's ability to manage its assets efficiently, particularly notable given the $3.2 million reversal of the provision for credit losses. This indicates an improvement in loan quality and prudent risk management.

The net interest margin's slight increase to 3.82% is encouraging after four consecutive declines, suggesting stabilization in interest-bearing accounts and loan yields. However, the 4.48% average rate on borrowings, driven by higher promotional deposit rates, indicates rising costs. Investors should keep an eye on how these dynamics evolve.

For retail investors, the performance of ACNB Corporation is promising. The increase in net interest income by 1.8% from Q1 2024 and the uptick in the net interest margin, indicates potential growth opportunities. The reversal of credit loss provisions reflects better-than-expected asset quality. With total loans growing by 6.7% and non-performing loans decreasing, the company is capitalizing on commercial real estate demands.

Noninterest income's rise, driven primarily by insurance commissions and wealth management, underscores ACNB’s strategy to diversify revenue sources. These streams can provide more stability in volatile market conditions. The 14.3% increase in quarterly dividends to $0.32 per share is attractive to income-focused investors, signaling confidence in future cash flows.

ACNB Corporation's financial health is robust, evidenced by a tangible common equity ratio of 9.84% and a stable liquidity position. The increase in total stockholders’ equity by 3.4% from Q1 2024 and 12.5% year-over-year highlights a solid capital base. The corporation’s focus on profitability, despite economic challenges, is reflected in the efficient management of salaries and other operating expenses, which saw notable declines from the previous quarter.

Additionally, ACNB’s strategy to enhance loan quality, reduce non-performing loans and maintain zero net charge-offs speaks volumes about their risk management practices. The bank’s performance amidst rising borrowing costs and promotional deposit rates showcases their ability to manage interest rate risks effectively.

07/24/2024 - 07:45 AM

GETTYSBURG, Pa., July 24, 2024 (GLOBE NEWSWIRE) -- ACNB Corporation (NASDAQ: ACNB) (“ACNB” or the “Corporation”), financial holding company for ACNB Bank and ACNB Insurance Services, Inc., announced net income of $11.3 million, or $1.32 diluted earnings per share, for the three months ended June 30, 2024 compared to net income of $9.5 million, or $1.12 diluted earnings per share, for the three months ended June 30, 2023. Compared to the three months ended March 31, 2024, net income and diluted earnings per share for the three months ended June 30, 2024 increased $4.5 million and $0.52, respectively. The financial results for the three month period ended June 30, 2024 were impacted by a $3.2 million reversal of the provision for credit losses and unfunded commitments.

2024 Second Quarter Highlights

Return on average assets was 1.86% and return on average equity was 16.12% for the three months ended June 30, 2024.
Fully taxable equivalent (“FTE”) net interest margin was 3.82% for the three months ended June 30, 2024 compared to 3.77% for the three months ended March 31, 2024 and 4.11% for the three months ended June 30, 2023. This marked the first linked quarter increase in FTE net interest margin after 4 consecutive quarterly declines.
Total loans were $1.68 billion at June 30, 2024, an increase of $14.6 million, or 0.9%, from March 31, 2024 and an increase of $105.8 million, or 6.7%, from June 30, 2023.
Total non-performing loans to total loans, net of unearned income, was 0.19% at June 30, 2024 compared to 0.24% at March 31, 2024 and 0.23% at June 30, 2023. Net charge-offs to average loans outstanding (annualized) were 0.00% for both the three months ended June 30, 2024 and the three months ended March 31, 2024 compared to 0.02% for the three months ended June 30, 2023.
Total deposits were $1.84 billion at June 30, 2024, an increase of $3.4 million compared to March 31, 2024. This marked the first linked quarter increase in deposits after 9 consecutive quarterly declines. Total deposits decreased $125.2 million compared to June 30, 2023.
The loan to deposit ratio was 91.35% at June 30, 2024 and the ratio of uninsured and non-collateralized deposits to total deposits was approximately 18.68% at ACNB Bank at June 30, 2024.
Tangible common equity to tangible assets ratio¹ of 9.84% at June 30, 2024 compared to 9.61% at March 31, 2024 and 8.75% at June 30, 2023. The net unrealized loss on the available for sale securities portfolio was $52.7 million at June 30, 2024 compared to a net unrealized loss of $53.0 million at March 31, 2024 and a net unrealized loss of $66.1 million at June 30, 2023.
ACNB and ACNB Bank capital levels remain well in excess of ACNB’s internal minimums and those required to be categorized as a well-capitalized institution by our bank regulators. ACNB’s overall liquidity position remains strong and stable.

“We are pleased to announce strong results for the second quarter of 2024 which reflect our continued focus on profitability. In spite of the continued economic challenges to the financial services industry our team remains focused on executing our strategic plan centered on our shareholders, customers and our communities,” said James P. Helt, ACNB Corporation President and Chief Executive Officer.

“We continued to experience strong loan demand through the first half of the year combined with stellar asset quality metrics. Our ongoing efforts to diversify our revenue streams with ACNB Insurance Services and our Wealth Management teams continue to show positive momentum. Our net interest margin improved during the quarter, our non-interest expenses were down quarter over quarter and as result we are pleased to report solid operating results both the quarter and year to date.”

Mr. Helt continued, “As we look forward to the remainder of 2024, we remain cautiously optimistic that our strong capital position, ample liquidity, superior asset quality metrics and our focus on profitability will enable us to deliver on our commitment to our many different stakeholders.”

Net Interest Income and Margin

Net interest income for the three months ended June 30, 2024 totaled $21.0 million, a decrease of $1.0 million, or 4.7%, compared to the three months ended June 30, 2023 due to a decrease in the FTE net interest margin over the same period. The FTE net interest margin for the three months ended June 30, 2024 was 3.82%, a decrease of 29 basis points from 4.11% for the three months ended June 30, 2023. The decrease in FTE net interest margin was driven primarily by an increase in long-term borrowings and promotional time deposit balances and costs. Total average borrowings increased $198.6 million for the three months ended June 30, 2024 compared to the same period in June 30, 2023. The average rate paid on total borrowings was 4.48% for the three months ended June 30, 2024, an increase of 133 basis points from the three months ended June 30, 2023. Total average interest-bearing deposits decreased $99.8 million, or 6.9%, for the three months ended June 30, 2024 compared to June 30, 2023; however, average time deposit balances increased $38.4 million due to the ongoing promotions. The average rate paid on interest-bearing deposits was 0.79% for the three months ended June 30, 2024, an increase of 66 basis points from the three months ended June 30, 2023.

Net interest income increased by $371 thousand, or 1.8%, for the three months ended June 30, 2024 compared to the three months ended March 31, 2024 driven by an increase in the FTE net interest margin over the same period. The FTE net interest margin for the three months ended June 30, 2024 increased 5 basis points from 3.77% for the three months ended March 31, 2024. The increase in FTE net interest margin was driven primarily by an increase in loan yields, the recognition of nonaccrual interest income related to a specific large relationship, and the stabilization of average interest-bearing and noninterest-bearing demand deposit balances during the quarter. The average yield on loans was 5.53% for the three months ended June 30, 2024, an increase of 16 basis points from the three months ended March 31, 2024. Excluding nonaccrual interest income related to the payoff of a specific large relationship, the FTE net interest margin was 3.79%. Total average interest-bearing deposits increased $11.0 million, or 0.8%, for the three months ended June 30, 2024 compared to the prior three months. The average rate paid on interest-bearing deposits was 0.79% for the three months ended June 30, 2024, an increase of 14 basis points from the three months ended March 31, 2024. Total average noninterest-bearing demand deposits decreased $1.3 million, or 0.3%, for the three months ended June 30, 2024 compared to the prior three months.

Noninterest Income

Noninterest income for the three months ended June 30, 2024 was $6.4 million, an increase of $233 thousand, or 3.8%, from the three months ended June 30, 2023. Insurance commissions for the three months ended June 30, 2024 were $2.7 million, a decrease of $93 thousand from the three months ended June 30, 2023 driven primarily by lower contingent income partially offset by organic growth and timing of policy renewals in the current quarter. Wealth management income for the three months ended June 30, 2024 was $1.1 million, an increase of $90 thousand from the three months ended June 30, 2023 driven primarily by market appreciation and new business generation. Net gains on sales or calls of investment securities for the three months ended June 30, 2023 was a loss of $546 thousand compared to none for the three months ended June 30, 2024. Gain on assets held for sale for the three months ended June 30, 2023 was a gain of $323 thousand compared to none for the three months ended June 30, 2024.

Compared to the three months ended March 31, 2024, noninterest income for the three months ended June 30, 2024 increased $760 thousand, or 13.4%, driven primarily by increases in insurance commissions, as a result of the timing of policy renewals and contingent commissions received. Additionally, wealth management income increased driven primarily by market appreciation and new business generation.

Noninterest Expense

Noninterest expense for the three months ended June 30, 2024 was $16.4 million, an increase of $110 thousand, or 0.7%, from the three months ended June 30, 2023. The increase was driven primarily by increases in salaries and employee benefits. Salaries and employee benefits expense increased $602 thousand driven primarily by higher incentive payment accruals and higher base wages. Partially offsetting this increase was lower other operating expenses of $329 thousand, driven primarily by a reduction in third-party vendor costs and a reduction in limited partnership investment losses occurring in the three months ended June 30, 2023. In addition, professional services declined $72 thousand, due to recruiting expenses incurred in the same period of the prior year. Marketing and corporate relations declined $71 thousand, due to rebranding expenses in the same period of the prior year.

Noninterest expense for the three months ended June 30, 2024 decreased $1.3 million, or 7.2%, from the three months ended March 31, 2024. The decrease was across all expense categories. Salaries and employee benefits decreased $742 thousand driven primarily by decreases in equity compensation, lower health insurance costs due to lower claims and employer insurance refunds, and lower payroll taxes compared to the prior quarter. Equipment expense decreased $159 thousand driven primarily by lower purchases of office equipment compared to the prior quarter. Net occupancy decreased $139 thousand driven primarily by lower snow removal, building maintenance, and utilities expenses compared to the prior quarter. Other expenses decreased $89 thousand driven primarily by lower bank insurance costs and timing of charitable donations. Professional services decreased $87 thousand driven primarily by lower loan collection costs.

Loans and Asset Quality

Total loans outstanding were $1.68 billion at June 30, 2024, an increase of $14.6 million, or 0.9%, from March 31, 2024 and an increase of $105.8 million, or 6.7%, from June 30, 2023. The increase in both periods was driven primarily by growth in the commercial real estate portfolio in our core markets. Growth in the commercial real estate portfolio was spread throughout the footprint and across various property types. Despite the intense competition in the Corporation’s Market Areas, management continues to focus on asset quality and disciplined underwriting standards in the loan origination process. The commercial real estate portfolio grew $51.4 million, or 5.7%, in 2024. The collateral for these loans is primarily spread across Pennsylvania and Maryland.

Asset quality metrics continue to be stable. The provision for credit losses was a reversal of $3.0 million and the provision for unfunded commitments was a reversal of $259 thousand for the three months ended June 30, 2024 compared to a provision for credit losses of $223 thousand and the provision for unfunded commitments was a reversal of $151 thousand for the three months ended March 31, 2024. For the three months ended June 30, 2023, there was a reversal to the provision for credit losses of $273 thousand and a $121 thousand provision for unfunded commitments. The decrease in the provision for credit losses and unfunded commitments for the three months ended June 30, 2024 compared to the prior quarter and the same quarter of 2023 was driven primarily by updated estimates utilized as input assumptions within the Current Expected Credit Loss “CECL” model calculation. These estimates, which were based on more current information available as of June 30, 2024, drive input assumptions which are used in the determination of the Corporation’s allowance for credit losses and the reserve for unfunded commitments. Non-performing loans were $3.1 million, or 0.19%, of total loans at June 30, 2024 compared to $3.9 million, or 0.24%, of total loans at March 31, 2024 and $3.7 million, or 0.23%, of total loans at June 30, 2023. The decrease in non-performing loans at June 30, 2024 compared to the prior quarter was the result of one relationship payoff and several unrelated paydowns. Annualized net charge-offs for the three months ended June 30, 2024 and March 31, 2024 were 0.00% of total average loans compared to 0.02% for the three months ended June 30, 2023.

Deposits and Borrowings

Deposits totaled $1.84 billion at June 30, 2024, an increase of $3.4 million, or 0.2%, since March 31, 2024 and a decrease of $125.2 million, or 6.4%, from June 30, 2023. Included in total deposits were $1.36 billion interest-bearing deposits at June 30, 2024 which increased $23.2 million, or 1.7%, from March 31, 2024 and decreased by $35.2 million, or 2.5%, from June 30, 2023. Total noninterest-bearing deposits were $479.7 million at June 30, 2024 compared to $499.6 million at March 31, 2024 and $569.7 million at June 30, 2023. The ratio of uninsured and non-collateralized deposits to total deposits was approximately 18.68% at ACNB Bank at June 30, 2024.

Total borrowings were $304.3 million at June 30, 2024, an increase of $31.7 million, or 11.6%, compared to March 31, 2024 and an increase of $171.6 million, or 129.3%, compared to June 30, 2023. The average rate on total borrowings was 4.48% for the three months ended June 30, 2024 compared to 4.38% for the three months ended March 31, 2024 and 3.15% for the three months ended June 30, 2023.

Stockholders’ Equity, Dividends and Share Repurchases

Total stockholders’ equity was $289.3 million at June 30, 2024 compared to $279.9 million at March 31, 2024 and $257.1 million at June 30, 2023. Tangible book value² per share was $27.82, $26.70 and $23.83 at June 30, 2024, March 31, 2024 and June 30, 2023, respectively.

As announced on Form 8-K on July 24, 2024, the Board of Directors approved and declared a regular quarterly cash dividend of $0.32 per share of ACNB Corporation common stock payable on September 13, 2024, to shareholders of record as of August 30, 2024. This per share amount reflects a $0.04, or 14.3%, increase over the same quarter of 2023.

ACNB did not repurchase any shares of ACNB common stock during the three months ended June 30, 2024.

About ACNB Corporation

ACNB Corporation, headquartered in Gettysburg, PA, is the $2.46 billion financial holding company for the wholly-owned subsidiaries of ACNB Bank, Gettysburg, PA, and ACNB Insurance Services, Inc., Westminster, MD. Originally founded in 1857, ACNB Bank serves its marketplace with banking and wealth management services, including trust and retail brokerage, via a network of 26 community banking offices and three loan offices located in the Pennsylvania counties of Adams, Cumberland, Franklin, Lancaster and York and the Maryland counties of Baltimore, Carroll and Frederick. ACNB Insurance Services, Inc. is a full-service insurance agency with licenses in 46 states. The agency offers a broad range of property, casualty, health, life and disability insurance serving personal and commercial clients through office locations in Westminster and Jarrettsville, MD, and Gettysburg, PA. For more information regarding ACNB Corporation and its subsidiaries, please visit investor.acnb.com.

SAFE HARBOR AND FORWARD-LOOKING STATEMENTS - Should there be a material subsequent event prior to the filing of the Quarterly Report on Form 10-Q with the Securities and Exchange Commission, the financial information reported in this press release is subject to change to reflect the subsequent event. In addition to historical information, this press release may contain forward-looking statements. Examples of forward-looking statements include, but are not limited to, (a) projections or statements regarding future earnings, expenses, net interest income, other income, earnings or loss per share, asset mix and quality, growth prospects, capital structure, and other financial terms, (b) statements of plans and objectives of Management or the Board of Directors, and (c) statements of assumptions, such as economic conditions in the Corporation’s market areas. Such forward-looking statements can be identified by the use of forward-looking terminology such as “believes”, “expects”, “may”, “intends”, “will”, “should”, “anticipates”, or the negative of any of the foregoing or other variations thereon or comparable terminology, or by discussion of strategy. Forward-looking statements are subject to certain risks and uncertainties such as national, regional and local economic conditions, competitive factors, and regulatory limitations. Actual results may differ materially from those projected in the forward-looking statements. Such risks, uncertainties, and other factors that could cause actual results and experience to differ from those projected include, but are not limited to, the following: short-term and long-term effects of inflation and rising costs on the Corporation, customers and economy; banking instability caused by bank failures and continuing financial uncertainty of various banks which may adversely impact the Corporation and its securities and loan values, deposit stability, capital adequacy, financial condition, operations, liquidity, and results of operations; effects of governmental and fiscal policies, as well as legislative and regulatory changes; effects of new laws and regulations (including laws and regulations concerning taxes, banking, securities and insurance) and their application with which the Corporation and its subsidiaries must comply; impacts of the capital and liquidity requirements of the Basel III standards; effects of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Financial Accounting Standards Board and other accounting standard setters; ineffectiveness of the business strategy due to changes in current or future market conditions; future actions or inactions of the United States government, including the effects of short-term and long-term federal budget and tax negotiations and a failure to increase the government debt limit or a prolonged shutdown of the federal government; effects of economic conditions particularly with regard to the negative impact of any pandemic, epidemic or health-related crisis and the responses thereto on the operations of the Corporation and current customers, specifically the effect of the economy on loan customers’ ability to repay loans; effects of competition, and of changes in laws and regulations on competition, including industry consolidation and development of competing financial products and services; inflation, securities market and monetary fluctuations; risks of changes in interest rates on the level and composition of deposits, loan demand, and the values of loan collateral, securities, and interest rate protection agreements, as well as interest rate risks; difficulties in acquisitions and integrating and operating acquired business operations, including information technology difficulties; challenges in establishing and maintaining operations in new markets; effects of technology changes; effects of general economic conditions and more specifically in the Corporation’s market areas; failure of assumptions underlying the establishment of reserves for credit losses and estimations of values of collateral and various financial assets and liabilities; acts of war or terrorism or geopolitical instability; disruption of credit and equity markets; ability to manage current levels of impaired assets; loss of certain key officers; ability to maintain the value and image of the Corporation’s brand and protect the Corporation’s intellectual property rights; continued relationships with major customers; and, potential impacts to the Corporation from continually evolving cybersecurity and other technological risks and attacks, including additional costs, reputational damage, regulatory penalties, and financial losses. Management considers subsequent events occurring after the balance sheet date for matters which may require adjustment to, or disclosure in, the consolidated financial statements. The review period for subsequent events extends up to and including the filing date of the Corporation's consolidated financial statements when filed with the SEC. Accordingly, the financial information in this announcement is subject to change. We caution readers not to place undue reliance on these forward-looking statements. They only reflect Management’s analysis as of this date. The Corporation does not revise or update these forward-looking statements to reflect events or changed circumstances. Please carefully review the risk factors described in other documents the Corporation files from time to time with the SEC, including the Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q. Please also carefully review any Current Reports on Form 8-K filed by the Corporation with the SEC.

ACNB #2024-10
July 24, 2024

ACNB Corporation Financial Highlights Selected Financial Data by Respective Quarter End (Unaudited)
(Dollars in thousands, except per share data)	June 30, 2024			March 31, 2024			December 31, 2023			September 30, 2023			June 30, 2023
BALANCE SHEET DATA
Assets	$	2,457,753		$	2,414,288		$	2,418,847		$	2,388,522		$	2,378,151
Investment securities		483,868			490,626			517,221			501,063			518,093
Total loans, net of unearned income		1,679,600			1,664,980			1,627,988			1,615,966			1,573,817
Allowance for credit losses		(17,162)			(20,172	)		(19,969	)		(19,264	)		(19,148	)
Deposits		1,838,588			1,835,224			1,861,813			1,951,359			1,963,754
Allowance for unfunded commitments		1,310			1,569			1,719			1,962			2,132
Borrowings		304,286			272,605			252,174			153,388			132,703
Stockholders’ equity		289,331			279,920			277,461			255,638			257,069
INCOME STATEMENT DATA
Interest and dividend income	$	26,869		$	25,974		$	25,284		$	24,234		$	23,213
Interest expense		5,905			5,381			3,791			2,489			1,223
Net interest income		20,964			20,593			21,493			21,745			21,990
(Reversal of ) provision for credit losses		(2,990	)		223			786			250			(273	)
(Reversal of) provision for unfunded commitments		(259	)		(151	)		(242	)		(171	)		121
Net interest income after provisions for credit losses and unfunded commitments		24,213			20,521			20,949			21,666			22,142
Noninterest income		6,427			5,667			970			6,297			6,194
Noninterest expenses		16,391			17,662			17,173			16,336			16,281
Income before income taxes		14,249			8,526			4,746			11,627			12,055
Provision for income taxes		2,970			1,758			649			2,583			2,531
Net income	$	11,279		$	6,768		$	4,097		$	9,044		$	9,524
PROFITABILITY RATIOS
Total loans, net of unearned income to deposits		91.35	%		90.72	%		87.44	%		82.81	%		80.14	%
Return on average assets (annualized)		1.86			1.12			0.68			1.52			1.62
Return on average equity (annualized)		16.12			9.76			6.09			13.84			14.74
Efficiency ratio³		58.69			66.18			62.48			56.97			55.52
FTE Net interest margin		3.82			3.77			3.93			4.01			4.11
Yield on average earning assets		4.89			4.74			4.62			4.46			4.33
Yield on investment securities		2.65			2.70			2.36			2.24			2.24
Yield on total loans		5.53			5.37			5.29			5.16			5.05
Cost of funds		1.12			1.02			0.71			0.47			0.23
PER SHARE DATA
Diluted earnings per share	$	1.32		$	0.80		$	0.48		$	1.06		$	1.12
Cash dividends paid per share		0.32			0.30			0.30			0.28			0.28
Tangible book value per share³		27.82			26.70			26.44			23.80			23.83
Tangible book value per share³ (excluding AOCI)⁴		33.28			32.21			31.74			31.43			30.64
CAPITAL RATIOS⁵
Tier 1 leverage ratio		12.25	%		11.91	%		11.57	%		11.97	%		11.79	%
Common equity tier 1 ratio		15.78			15.40			15.16			15.30			15.38
Tier 1 risk based capital ratio		16.07			15.69			15.45			15.59			15.72
Total risk based capital ratio		17.86			17.68			17.41			17.49			17.67
CREDIT QUALITY
Net charge-offs to average loans outstanding (annualized)		0.00	%		0.00	%		0.02	%		0.03	%		0.02	%
Total non-performing loans to total loans, net of unearned income⁶		0.19			0.24			0.26			0.22			0.23
Total non-performing assets to total assets⁷		0.14			0.18			0.19			0.17			0.17
Allowance for credit losses to total loans, net of unearned income		1.02			1.21			1.23			1.19			1.22

Consolidated Balance Sheet (Unaudited)
(Dollars in thousands, except per share data)	June 30, 2024			March 31, 2024			December 31, 2023
ASSETS
Cash and due from banks	$	26,681			17,395		$	21,442
Interest-bearing deposits with banks		59,593			35,740			44,516
Total Cash and Cash Equivalents		86,274			53,135			65,958
Equity securities with readily determinable fair values		919			918			928
Investment securities available for sale, at estimated fair value		418,364			425,114			451,693
Investment securities held to maturity, at amortized cost (fair value $57,026, $58,084, and $59,057)		64,585			64,594			64,600
Loans held for sale		1,801			88			280
Total loans, net of unearned income		1,679,600			1,664,980			1,627,988
Less: Allowance for credit losses		(17,162	)		(20,172	)		(19,969	)
Loans, net		1,662,438			1,644,808			1,608,019
Premises and equipment, net		25,760			25,916			26,283
Right of use asset		2,278			2,447			2,615
Restricted investment in bank stocks		11,853			10,877			9,677
Investment in bank-owned life insurance		80,841			80,348			79,871
Investments in low-income housing partnerships		940			971			1,003
Goodwill		44,185			44,185			44,185
Intangible assets, net		8,446			8,761			9,082
Foreclosed assets held for resale		406			467			467
Other assets		48,663			51,659			54,186
Total Assets	$	2,457,753		$	2,414,288		$	2,418,847

LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Noninterest-bearing	$	479,726		$	499,583		$	500,332
Interest-bearing		1,358,862			1,335,641			1,361,481
Total Deposits		1,838,588			1,835,224			1,861,813
Short-term borrowings		48,974			17,303			56,882
Long-term borrowings		255,312			255,302			195,292
Lease liability		2,278			2,447			2,615
Allowance for unfunded commitments		1,310			1,569			1,719
Other liabilities		21,960			22,523			23,065
Total Liabilities		2,168,422			2,134,368			2,141,386

Stockholders’ Equity:
Preferred Stock, $2.50 par value; 20,000,000 shares authorized; no shares outstanding at June 30, 2024, March 31, 2024 and December 31, 2023, respectively		—			—			—
Common stock, $2.50 par value; 20,000,000 shares authorized; 8,934,495, 8,928,441, and 8,896,119 shares issued; 8,545,629, 8,539,575, and 8,511,453 shares outstanding at June 30, 2024, March 31, 2024 and December 31, 2023, respectively		22,330			22,315			22,231
Treasury stock, at cost; 388,866, 388,866, and 384,666 shares at June 30, 2024, March 31, 2024 and December 31, 2023, respectively		(11,101	)		(11,101	)		(10,954	)
Additional paid-in capital		98,230			97,818			97,602
Retained earnings		226,271			217,712			213,491
Accumulated other comprehensive loss		(46,399	)		(46,824	)		(44,909	)
Total Stockholders’ Equity		289,331			279,920			277,461
Total Liabilities and Stockholders’ Equity	$	2,457,753		$	2,414,288		$	2,418,847

Consolidated Income Statements (Unaudited)
	Three Months Ended June 30,						Six Months Ended June 30,
(Dollars in thousands, except per share data)		2024			2023			2024			2023
INTEREST AND DIVIDEND INCOME
Loans, including fees
Taxable	$	22,675		$	18,947		$	44,145		$	37,845
Tax-exempt		313			352			632			708
Investment securities:
Taxable		2,665			2,688			5,576			5,974
Tax-exempt		284			285			568			599
Dividends		248			51			488			92
Other		684			890			1,434			1,904
Total Interest and Dividend Income		26,869			23,213			52,843			47,122
INTEREST EXPENSE
Deposits		2,643			486			4,803			959
Short-term borrowings		304			108			643			125
Long-term borrowings		2,958			629			5,840			956
Total Interest Expense		5,905			1,223			11,286			2,040
Net Interest Income		20,964			21,990			41,557			45,082
Reversal of credit losses		(2,990	)		(273	)		(2,767	)		(176	)
(Reversal of) provision for unfunded commitments		(259	)		121			(410	)		397
Net Interest Income after Provisions for Credit Losses and Unfunded Commitments		24,213			22,142			44,734			44,861
NONINTEREST INCOME
Insurance commissions		2,747			2,840			4,862			4,742
Service charges on deposits		1,021			989			2,012			1,951
Wealth management		1,069			979			2,031			1,819
ATM debit card charges		841			834			1,660			1,657
Earnings on investment in bank-owned life insurance		493			484			970			926
Gain from mortgage loans held for sale		34			14			82			31
Net (losses) gains on sales or calls of investment securities		—			(546	)		69			(739	)
Net gains (losses) on equity securities		1			(15	)		(9	)		5
Gain on assets held for sale		—			323			—			323
Other		221			292			417			463
Total Noninterest Income		6,427			6,194			12,094			11,178
NONINTEREST EXPENSES
Salaries and employee benefits		10,426			9,824			21,594			20,266
Equipment		1,570			1,623			3,299			3,230
Net occupancy		991			1,002			2,121			2,039
Professional services		529			601			1,145			983
FDIC and regulatory		348			295			723			544
Other tax		356			305			726			642
Intangible assets amortization		315			360			636			720
Supplies and postage		183			198			374			404
Marketing and corporate relations		88			159			176			313
Other		1,585			1,914			3,259			3,422
Total Noninterest Expenses		16,391			16,281			34,053			32,563
Income Before Income Taxes		14,249			12,055			22,775			23,476
Provision for income taxes		2,970			2,531			4,728			4,929
Net Income	$	11,279		$	9,524		$	18,047		$	18,547
PER SHARE DATA
Basic earnings	$	1.32		$	1.12		$	2.12		$	2.18
Diluted earnings	$	1.32		$	1.12		$	2.12		$	2.17

Average Balances, Income and Expenses, Yields and Rates
	Three months ended								Three months ended								Three months ended								Three months ended								Three months ended
	June 30, 2024								March 31, 2024								December 31, 2023								September 30, 2023								June 30, 2023
(Dollars in thousands)	Average Balance			Interest⁸			Yield/ Rate		Average Balance			Interest⁸			Yield/ Rate		Average Balance			Interest⁸			Yield/ Rate		Average Balance			Interest⁸			Yield/ Rate		Average Balance			Interest⁸			Yield/ Rate
ASSETS
Loans:
Taxable	$	1,612,380		$	22,675		5.66	%	$	1,573,109		$	21,470		5.49	%	$	1,559,411		$	21,303		5.42	%	$	1,520,134		$	20,285		5.29	%		1,463,967			18,946		5.19	%
Tax-exempt		64,276			396		2.48			65,825			404		2.47			69,058			425		2.44			73,995			457		2.45			75,670			446		2.36
Total Loans⁹		1,676,656			23,071		5.53			1,638,934			21,874		5.37			1,628,469			21,728		5.29			1,594,129			20,742		5.16			1,539,637			19,392		5.05
Investment Securities:
Taxable		442,390			2,913		2.65			467,466			3,151		2.71			453,713			2,669		2.33			466,402			2,581		2.20			498,401			2,739		2.20
Tax-exempt		54,644			359		2.64			54,740			359		2.64			54,835			361		2.61			55,027			359		2.59			55,588			361		2.60
Total Investments¹⁰		497,034			3,272		2.65			522,206			3,510		2.70			508,548			3,030		2.36			521,429			2,940		2.24			553,989			3,100		2.24
Interest-bearing deposits with banks		50,851			684		5.41			54,156			750		5.57			50,225			691		5.46			53,324			723		5.38			71,040			890		5.03
Total Earning Assets		2,224,541			27,027		4.89			2,215,296			26,134		4.74			2,187,242			25,449		4.62			2,168,882			24,405		4.46			2,164,666			23,382		4.33
Cash and due from banks		21,041								20,540								21,578								23,783								22,215
Premises and equipment		25,903								26,102								25,983								25,980								26,420
Other assets		187,937								187,075								191,329								165,821								163,783
Allowance for credit losses		(20,124	)							(19,963	)							(19,232	)							(19,101	)							(19,458	)
Total Assets	$	2,439,298							$	2,429,050							$	2,406,900							$	2,365,365							$	2,357,626
LIABILITIES
Interest-bearing demand deposits	$	513,163		$	275		0.22	%	$	512,701		$	264		0.21	%	$	560,510		$	275		0.19	%	$	571,314		$	185		0.13	%	$	577,480		$	150		0.10	%
Money markets		248,191			613		0.99			248,297			536		0.87			274,226			707		1.02			245,899			312		0.50			261,560			100		0.15
Savings deposits		327,274			30		0.04			335,215			29		0.03			348,244			28		0.03			366,398			30		0.03			387,847			31		0.03
Time deposits		263,045			1,725		2.64			244,481			1,331		2.19			221,778			798		1.43			212,159			401		0.75			224,608			205		0.37
Total Interest-Bearing Deposits		1,351,673			2,643		0.79			1,340,694			2,160		0.65			1,404,758			1,808		0.51			1,395,770			928		0.26			1,451,495			486		0.13
Short-term borrowings		37,256			304		3.28			47,084			339		2.90			56,872			334		2.33			66,942			439		2.60			34,080			108		1.27
Long-term borrowings		255,305			2,958		4.66			248,701			2,882		4.66			137,026			1,649		4.77			94,554			1,122		4.71			59,901			629		4.21
Total Borrowings		292,561			3,262		4.48			295,785			3,221		4.38			193,898			1,983		4.06			161,496			1,561		3.83			93,981			737		3.15
Total Interest-Bearing Liabilities		1,644,234			5,905		1.44			1,636,479			5,381		1.32			1,598,656			3,791		0.94			1,557,266			2,489		0.63			1,545,476			1,223		0.32
Noninterest-bearing demand deposits		485,351								486,648								519,797								541,995								550,581
Other liabilities		28,348								26,904								21,648								6,820								2,330
Stockholders’ Equity		281,365								279,019								266,799								259,284								259,239
Total Liabilities and Stockholders’ Equity	$	2,439,298							$	2,429,050							$	2,406,900							$	2,365,365							$	2,357,626
Taxable Equivalent Net Interest Income					21,122								20,753								21,658								21,916								22,159
Taxable Equivalent Adjustment					(158	)							(160	)							(165	)							(171	)							(169	)
Net Interest Income				$	20,964							$	20,593							$	21,493							$	21,745							$	21,990
Cost of Funds							1.12	%							1.02	%							0.71	%							0.47	%							0.23	%
FTE Net Interest Margin							3.82	%							3.77	%							3.93	%							4.01	%							4.11	%

Average Balances, Income and Expenses, Yields and Rates
	Six Months Ended June 30, 2024								Six Months Ended June 30, 2023
(Dollars in thousands)	Average Balance			Interest¹¹			Yield/ Rate		Average Balance			Interest¹¹		Yield/ Rate
ASSETS
Loans:
Taxable	$	1,592,745		$	44,145		5.57	%	$	1,459,455		$	37,844	5.23	%
Tax-exempt		65,050			800		2.47			76,501			897	2.36
Total Loans¹²		1,657,795			44,945		5.45			1,535,956			38,741	5.09
Investment Securities:
Taxable		454,928			6,064		2.68			527,576			6,066	2.32
Tax-exempt		54,692			719		2.64			55,449			758	2.76
Total Investments¹³		509,620			6,783		2.68			583,025			6,824	2.36
Interest-bearing deposits with banks		52,504			1,434		5.49			80,958			1,904	4.74
Total Earning Assets		2,219,919			53,162		4.82			2,199,939			47,469	4.35
Cash and due from banks		20,790								30,189
Premises and equipment		26,051								26,637
Other assets		187,458								160,316
Allowance for credit losses		(20,044	)							(18,658	)
Total Assets	$	2,434,174							$	2,398,423
LIABILITIES
Interest-bearing demand deposits	$	512,932		$	540		0.21	%	$	584,686		$	331	0.11	%
Money markets		248,244			1,149		0.93			285,996			139	0.10
Savings deposits		331,244			58		0.04			395,590			64	0.03
Time deposits		253,763			3,056		2.42			246,536			425	0.35
Total Interest-Bearing Deposits		1,346,183			4,803		0.72			1,512,808			959	0.13
Short-term borrowings		42,170			643		3.07			34,834			125	0.72
Long-term borrowings		252,004			5,840		4.66			43,597			956	4.42
Total Borrowings		294,174			6,483		4.43			78,431			1,081	2.78
Total Interest-Bearing Liabilities		1,640,357			11,286		1.38			1,591,239			2,040	0.26
Noninterest-bearing demand deposits		485,999								554,340
Other liabilities		27,626								(2,303	)
Stockholders’ Equity		280,192								255,147
Total Liabilities and Stockholders’ Equity	$	2,434,174							$	2,398,423
Taxable Equivalent Net Interest Income					41,876
Taxable Equivalent Adjustment					(319	)
Net Interest Income				$	41,557
Cost of Funds							1.07	%						0.19	%
FTE Net Interest Margin							3.79	%						4.16	%

Non-GAAP Reconciliation

Note: The Corporation has presented the following non-GAAP financial measures because it believes that these measures provide useful and comparative information to assess trends in the Corporation’s results of operations and financial condition. These non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the Corporation’s industry. Investors should recognize that the Corporation’s presentation of these non-GAAP financial measures might not be comparable to similarly-titled measures of other corporations. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures, and the Corporation strongly encourages a review of its condensed consolidated financial statements in their entirety.

	Three Months Ended
(Dollars in thousands, except per share data)	June 30, 2024			March 31, 2024			December 31, 2023			September 30, 2023			June 30, 2023
Tangible book value per share
Stockholders’ equity	$	289,331		$	279,920		$	277,461		$	255,638		$	257,069
Less: Goodwill and intangible assets		(52,631	)		(52,946	)		(53,267	)		(53,619	)		(53,797	)
Tangible common stockholders’ equity (numerator)	$	236,700		$	226,974		$	224,194		$	202,019		$	203,272
Shares outstanding, less unvested shares, end of period (denominator)		8,507,191			8,501,137			8,478,460			8,488,446			8,528,782
Tangible book value per share	$	27.82		$	26.70		$	26.44		$	23.80		$	23.83
Tangible book value per share (excluding AOCI)
Tangible common stockholders’ equity	$	236,700		$	226,974		$	224,194		$	202,019		$	203,272
Less: AOCI		(46,399	)		(46,824	)		(44,909	)		(64,767	)		(58,052	)
Tangible equity (excluding AOCI)	$	283,099		$	273,798		$	269,103		$	266,786		$	261,324
Tangible book value per share (excluding AOCI)	$	33.28		$	32.21		$	31.74		$	31.43		$	30.64
Tangible common equity to tangible assets (TCE/TA Ratio)
Tangible common stockholders’ equity (numerator)	$	236,700		$	226,974		$	224,194		$	202,019		$	203,272
Total assets	$	2,457,753		$	2,414,288		$	2,418,847		$	2,388,522		$	2,378,151
Less: Goodwill and intangible assets		(52,631	)		(52,946	)		(53,267	)		(53,619	)		(53,797	)
Total tangible assets (denominator)	$	2,405,122		$	2,361,342		$	2,365,580		$	2,334,903		$	2,324,354
Tangible common equity to tangible assets		9.84	%		9.61	%		9.48	%		8.65	%		8.75	%
Efficiency Ratio
Noninterest expense	$	16,391		$	17,662		$	17,173		$	16,336		$	16,281
Less: Intangible amortization		315			321			352			352			360
Less: Loss on MD Title Investment		—			—			—			—			142
Noninterest expense (numerator)	$	16,076		$	17,341		$	16,821		$	15,984		$	15,779
Net interest income	$	20,964		$	20,593		$	21,493		$	21,745		$	21,990
Plus: Total noninterest income		6,427			5,667			970			6,297			6,194
Less: Net gains (losses) on sales or calls of securities		—			69			(4,501	)		—			(546	)
Less: Net gains (losses) on equity securities		1			(10	)		40			(27	)		(15	)
Less: Gain on assets held for sale		—			—			—			14			323
Total revenue (denominator)	$	27,390		$	26,201		$	26,924		$	28,055		$	28,422
Efficiency ratio		58.69	%		66.18	%		62.48	%		56.97	%		55.52	%

¹ ^{Non-GAAP financial measure. Please refer to the calculation on the pages titled “Non-GAAP Reconciliation” at the end of this document.}
² ^{Non-GAAP financial measure. Please refer to the calculation on the pages titled “Non-GAAP Reconciliation” at the end of this document.}
³ ^{Non-GAAP financial measure. Please refer to the calculation on the pages titled “Non-GAAP Reconciliation” at the end of this document.}
^{4 Accumulated Other Comprehensive Income (Loss).}
^{5 Regulatory capital ratios as of June 30, 2024 are preliminary.}
^{6 Non-performing Loans consists of loans on nonaccrual status and loans greater than ninety days past due and still accruing interest.}
^{7 Non-performing Assets consists of Non-performing Loans and Foreclosed assets held for resale.}
^{8 Income on interest-earning assets has been computed on a fully taxable equivalent (FTE) basis using the 21% federal income tax statutory rate.}
^{9 Average balances include non-accrual loans and are net of unearned income.}
^{10 Average balances of investment securities is computed at fair value.}
^{11 Income on interest-earning assets has been computed on a fully taxable equivalent basis (FTE) using the 21% federal income tax statutory rate.}
^{12 Average balances include non-accrual loans and are net of unearned income.}
^{13 Average balances of investment securities is computed at fair value.}

Contact:	Jason H. Weber
	EVP/Treasurer &
	Chief Financial Officer
	717.339.5090
	jweber@acnb.com

FAQ

What was ACNB 's net income for Q2 2024?

ACNB reported net income of $11.3 million for Q2 2024.

How did ACNB's diluted earnings per share change in Q2 2024 compared to Q2 2023?

ACNB's diluted earnings per share increased to $1.32 in Q2 2024, up from $1.12 in Q2 2023.

What was ACNB's total loan balance as of June 30, 2024?

ACNB's total loans were $1.68 billion as of June 30, 2024, an increase of 6.7% from June 30, 2023.

How did ACNB's FTE net interest margin change in Q2 2024?

ACNB's FTE net interest margin improved to 3.82% in Q2 2024, up from 3.77% in Q1 2024, marking the first increase after 4 consecutive quarterly declines.

What dividend did ACNB declare for Q2 2024?

ACNB declared a quarterly cash dividend of $0.32 per share, a 14.3% increase from the previous year.

ACNB Corporation Reports 2024 Second Quarter Financial Results

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What was ACNB 's net income for Q2 2024?

How did ACNB's diluted earnings per share change in Q2 2024 compared to Q2 2023?

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ACNB Corporation Reports 2024 Second Quarter Financial Results

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What was ACNB 's net income for Q2 2024?

How did ACNB's diluted earnings per share change in Q2 2024 compared to Q2 2023?

What was ACNB's total loan balance as of June 30, 2024?

How did ACNB's FTE net interest margin change in Q2 2024?

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