june2010earningsrelease.htm


NEWS RELEASE



Contact:                 Wendy S. Schmucker
Senior Vice President, Secretary and Treasurer
724-537-9923

For Immediate Release

COMMERCIAL NATIONAL ACHIEVES EARNINGS GROWTH OF 30.16% FOR SECOND QUARTER AND 17.21% FOR FIRST SIX MONTHS

LATROBE, PA, August 3, 2010 - Commercial National Financial Corporation (NASDAQ:CNAF)(Company), parent Company of Commercial Bank & Trust of PA, has reported earnings for the quarter ended June 30, 2010. The Company earned $1,381,000 (or $.48 per average share outstanding) in 2010 compared to $1,061,000 (or $.37 per average share outstanding) in 2009. The Company earned $2,731,000 (or $.95 per average share outstanding) for the six-month period ended June 30, 2010 and $2,330,000 (or $.81 per average share outstanding) for the six-month period ended June 30, 2009. Second quarter 2010 earnings increased $320,000 or 30.16% while first six month 2010 earnings increased $401,000 or 17.21%.

President and Chief Executive Officer Gregg E. Hunter noted, “The higher earnings of 2010 are attributable to continued earning asset credit quality strength, the successful maintenance of a marginal leverage carry trade position, vastly improved tax efficiency as an ancillary benefit of that position, lessened funding reliance on rate sensitive non-core liabilities, proportionate and absolute growth in book capital and in the most valuable core deposit categories along with the non-recurrence of 2009’s mid-year industry-wide special emergency FDIC deposit insurance assessment which had an unfavorable after-tax impact of approximately $109,000. All of the aforementioned has enabled Commercial National to fortify its capital base exclusively via non-dilutive retained earnings while simultaneously providing for very attractive quarterly cash dividend payments to the Company’s shareholders.”
 
 
In addition to Latrobe, Pennsylvania where it is headquartered, the Company operates eleven community banking facilities in Greensburg, Hempfield Township, Ligonier, North Huntingdon, Unity Township and West Newton, Pennsylvania and also maintains a commercial business development sales force throughout its entire market area. The Company operates an asset management and trust division of Commercial Bank & Trust of PA headquartered in Greensburg, Pennsylvania. Commercial Bank & Trust of PA also serves its customer base from an Internet banking site (www.cbthebank.com) and an automated TouchTone Teller banking system.


Safe Harbor Statement

Forward-looking statements (statements which are not historical facts) in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as “may,” “will,” “to,” “expect,” “believe,” “anticipate,” “intend,” “could,” “would,” “estimate,” or “continue” or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements. These statements are based on information currently available to the Company, and the Company assumes no obligation to update these statements as circumstances change. Investors are cautioned that all forward-looking statements involve risk and uncertainties, including changes in general economic and financial market conditions, unforeseen credit problems, and the Company's ability to execute its business plans.  The actual results of future events could differ materially from those stated in any forward-looking statements herein.

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                                       COMMERCIAL NATIONAL FINANCIAL CORPORATION
            
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
        
                                       (Dollars in thousands except per share data)
            
             
   
June 30,
    
June 30,
  
   
2010
    
2009
  
   
(unaudited)
    
(unaudited)
  
             
ASSETS
            
Cash and due from banks on demand
   $ 6,106     $ 9,906  
Interest bearing deposits with banks
     28       62  
Total cash and cash equivalents
     6,134       9,968  
                 
Securities available for sale
     138,766       129,946  
Restricted investments in bank stock
     4,567       4,567  
                 
Loans
     197,998       206,386  
Allowance for loan losses
     (1,694 )     (1,798 )
Net loans
     196,304       204,588  
                 
Premises and equipment
     3,449       3,515  
Investment in Life Insurance
     15,164       14,798  
Other assets
     4,039       2,608  
                 
Total assets
   $ 368,423     $ 369,990  
                 
LIABILITIES AND SHAREHOLDERS' EQUITY
                
Liabilities:
                
Deposits:
                
Non-interest bearing
   $ 74,542     $ 71,920  
Interest bearing
     199,837       192,274  
Total deposits
     274,379       264,194  
                 
Short term borrowings
     34,650       31,625  
Long term borrowings
     10,000       30,000  
Other liabilities
     3,918       3,482  
Total liabilities
     322,947       329,301  
                 
Shareholders' equity:
                
 
  
 
Common stock, par value $2 per share; 10,000,000 shares authorized;
               
        3,600,000 shares issued; 2,860,953 and 2,861,953 shares                
        outstanding in 2010 and 2009 respectively.     7,200       7,200  
                 
Retained earnings
     45,695       42,684  
                 
Accumulated other comprehensive income (loss)
     5,125       3,334  
                 
Less treasury stock, at cost, 739,047 and  738,047 shares in 2010 and 2009 respectively
     (12,544 )     (12,529 )
Total shareholders' equity
     45,476       40,689  
                 
Total liabilities and shareholders' equity
   $ 368,423     $ 369,990  
                 

 
 

 
 

COMMERCIAL NATIONAL FINANCIAL CORPORATION
                    
CONSOLIDATED STATEMENTS OF INCOME
                    
                                 (Dollars in thousands, except per share data)
                        
                         
   
Three Months
      
Three Months
    
Six Months
      
Six Months
  
   
Ended June 30
      
Ended June 30
    
Ended June 30
      
Ended June 30
  
   
2010
    
2009
    
2010
    
2009
  
   
(unaudited)
    
(unaudited)
    
(unaudited)
    
(unaudited)
  
                         
INTEREST INCOME:
                        
Interest and fees on loans
   $ 2,854     $ 3,021     $ 5,774     $ 6,110  
Interest and dividends on securities:
                                
Taxable
     1,165       1,798       2,488       3,721  
Exempt from federal income taxes
     590       33       1,038       46  
Other
     1       1       2       2  
Total Interest income
     4,610       4,853       9,302       9,879  
                                 
INTEREST EXPENSE:
                                
Interest on deposits
     633       805       1,283       1,674  
Interest on short-term borrowings
     36       47       77       105  
Interest on long-term borrowings
     59       288       118       573  
Total Interest expense
     728       1,140       1,478       2,352  
                                 
NET INTEREST INCOME
     3,882       3,713       7,824       7,527  
PROVISION FOR LOAN LOSSES
     -       -       -       -  
                                 
NET INTEREST INCOME AFTER
                                
PROVISION FOR LOAN LOSSES
     3,882       3,713       7,824       7,527  
                                 
OTHER OPERATING INCOME:
                                
Asset management and trust income
     217       242       429       489  
Service charges on deposit accounts
     136       144       263       283  
Other service charges and fees
     184       176       391       378  
Income from investment in life insurance
     122       121       243       243  
Other income
     40       44       86       94  
Total other operating income
     699       727       1,412       1,487  
                                 
OTHER OPERATING EXPENSES
                                
Salaries and employee benefits
     1,490       1,397       3,009       2,831  
Net occupancy expense
     199       201       426       409  
Furniture and equipment
     135       130       277       253  
Pennsylvania shares tax
     126       126       252       256  
Legal and professional
     115       121       239       244  
FDIC  insurance expense
     85       261       167       272  
Other expenses
     720       710       1,427       1,445  
Total other operating expenses
     2,870       2,946       5,797       5,710  
                                 
INCOME BEFORE INCOME TAXES
     1,711       1,494       3,439       3,304  
Income tax expense
     330       433       708       974  
                                 
Net income
   $ 1,381     $ 1,061     $ 2,731     $ 2,330  
                                 
Average Shares Outstanding
     2,860,953       2,867,349       2,860,953       2,871,745  
                                 
Earnings Per Share
   $ 0.48     $ 0.37     $ 0.95     $ 0.81