Commercial National Financial Corporation Reports 1st Quarter 2024 Earnings

Rhea-AI Summary

Commercial National Financial reported a net income of $1,161,000 or $0.29 per share for the first quarter of 2024, compared to $1,470,000 or $0.37 per share in the first quarter of 2023. Return on Equity (ROE) decreased to 9.95% from 14.40% in the same period. Net interest income decreased by 4.2% due to higher interest expenses outpacing income growth. Noninterest income increased by 13.7%, while operating expenses rose by 9.9%. Total assets decreased to $591.7 million from $600.9 million in March 2023, mainly due to repayment of borrowings and a decrease in deposit balances. Despite a reduction in total loans, loan quality remained strong with a non-performing assets ratio of 0.20%. The construction of a new office in Grand Rapids is nearing completion, with an expected opening in June 2024.

ITHACA, Mich., April 26, 2024 (GLOBE NEWSWIRE) -- Commercial National Financial Corporation (Pink Sheets: CEFC) reported net income for the first quarter of 2024 of $1,161,000 or $0.29 per share compared to first quarter 2023 net income of $1,470,000 or $0.37 per share. Return on Equity (ROE) was 9.95% for the first quarter of 2024 compared to 14.40% for the first quarter of 2023.

Net interest income for the first quarter of 2024 decreased by $199,000 or 4.2% compared to the respective 2023 period. While interest income increased by $539,000 due to higher yields on loans and other interest-earning assets, interest expense increased at a higher rate of $738,000, which resulted in slightly lower net interest margin and reduced income. The main contributing factors resulting in higher interest expense was an increase in the federal funds rate, along with a noticeable shift in customers moving from noninterest-bearing to interest-bearing checking and time deposit accounts. Noninterest income increased by $65,000 or 13.7% primarily due to higher interchange income and other miscellaneous income. Operating expenses increased by $324,000 or 9.9% mainly due to higher wages and benefit costs.

Total assets were $591.7 million as of March 31, 2024 compared to $600.9 million as of March 2023. The decrease in assets was due to the repayment of wholesale borrowings and trust preferred debt, along with a 1.2% decrease in deposit balances. While total loans decreased by $8.8 million or 2.1%, loan quality remained strong with a non-performing assets ratio of 0.20%. Additionally, CEFC’s wholly owned subsidiary, Commercial Bank, remains significantly above “well capitalized” for regulatory purposes.

We are also very pleased to announce that the construction of our new Grand Rapids office is nearing completion, with an anticipated opening date in early June of 2024. We continue to look for opportunities to expand our community bank and look forward to growing our loan and deposit base during 2024.

Visit www.commercial-bank.com to view the latest news releases and other information about CEFC and Commercial Bank.

Selected Financial Data (unaudited):
	Quarter Ended March 31,
		2024				2023
Return on Equity (ROE)		9.95	%			14.40	%
Return on Assets (ROA)		0.79	%			0.98	%
Net Interest Margin		3.25	%			3.28	%
	March 31,
		2024				2023
Non-Performing Assets Ratio		0.20	%			0.13	%
Tier 1 Leverage Capital Ratio(1)		9.70	%			9.04	%
Total Risk-Based Capital Ratio(1)		15.81	%			15.06	%
Book Value Per Share	$	11.89			$	10.66
Market Value Per Share	$	9.15			$	10.75
(1) Ratios are for Commercial Bank
Consolidated Statements of Income (unaudited):
	Quarter Ended March 31,
		2024				2023
Interest Income	$	6,615,474			$	6,076,059
Interest Expense		2,123,427				1,385,415
Net Interest Income		4,492,047				4,690,644
Provision for loan losses		40,000				121,000
Non-interest income		537,092				472,504
Operating Expenses		3,595,018				3,270,792
Income before taxes		1,394,121				1,771,356
Income tax expense		232,990				301,300
Net Income	$	1,161,131			$	1,470,056
Net Income per share — diluted	$	0.29			$	0.37
Dividends declared	$	0.14			$	0.14
Consolidated Balance Sheets (unaudited):
	March 31,
		2024				2023
Assets
Cash and cash equivalents	$	59,248,093			$	45,031,302
Time deposits with other banks		1,992,000				4,482,000
Securities		84,835,301				98,252,929
Loans		414,380,652				423,195,140
Allowance for loan losses		(3,609,455	)			(3,881,282	)
Loans, net		410,771,197				419,313,858
Premises and equipment, net		9,655,198				8,718,868
Other assets		25,205,622				25,101,915
Total Assets	$	591,707,411			$	600,900,872
Liabilities
Deposits	$	516,760,150			$	523,072,519
FHLB borrowings		14,000,000				19,000,000
Trust preferred		10,310,000				13,403,000
Other liabilities		3,490,066				3,170,449
Total Liabilities		544,560,216				558,645,968
Equity
Total Equity		47,147,195				42,254,904
Total Liabilities and Equity	$	591,707,411			$	600,900,872

Contact:
Benjamin Z. Ogle
CFO
989-875-5562

FAQ

What was Commercial National Financial 's net income for the first quarter of 2024?

Commercial National Financial reported a net income of $1,161,000 for the first quarter of 2024.

What was the Return on Equity (ROE) for Commercial National Financial in the first quarter of 2024?

The Return on Equity (ROE) for Commercial National Financial was 9.95% in the first quarter of 2024.

What was the total assets of Commercial National Financial as of March 31, 2024?

Total assets of Commercial National Financial were $591.7 million as of March 31, 2024.

What caused the decrease in total assets for Commercial National Financial ?

The decrease in total assets was primarily due to the repayment of borrowings and a decrease in deposit balances for Commercial National Financial

What was the non-performing assets ratio for Commercial National Financial ?

The non-performing assets ratio for Commercial National Financial was 0.20%.