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Commercial National Financial Corporation Reports 4th Quarter 2023 Earnings

ITHACA, Mich., Jan. 26, 2024 (GLOBE NEWSWIRE) — Commercial National Financial Corporation (Pink Sheets: CEFC) today announced that net income for the fourth quarter of 2023 was $1,458,000 or $0.37 per share compared to fourth quarter 2022 net income of $1,912,000 or $0.48 per share. Return on Equity (ROE) was 13.34% for the fourth quarter of 2023 compared to 19.86% for the fourth quarter of 2022.

Net interest income for the fourth quarter of 2023 decreased by $523,000 or 10.3% compared to the fourth quarter of 2022. While interest income increased due to higher market interest rates, interest expense on deposits increased at a higher pace during 2023, which resulted in lower net interest margins and reduced income. Additionally, non-interest income decreased by $34,000 or 7.0%, as miscellaneous income was down, while operating expenses increased by $53,000 or 1.6%, as occupancy and equipment costs were higher.

Total loans increased by $6.1 million or 1.5% year-over-year, mainly due to new commercial loan originations. Total assets were $579.2 million at December 31, 2023 compared to $613.8 million at December 31, 2022. The decrease in assets was due to the repayment of wholesale borrowings with excess liquidity and lower deposit balances. CEFC’s wholly owned subsidiary, Commercial Bank, remains significantly above “well capitalized” for regulatory purposes.

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 December 31, Year Ended December 31,
  2023   2022   2023   2022 
Return on Equity (ROE) 13.34%  19.86%  14.40%  19.20%
Return on Assets (ROA) 0.99%  1.22%  1.04%  1.29%
Net Interest Margin 3.28%  3.41%  3.26%  3.44%
        
 December 31,    
  2023   2022     
Non-performing Assets Ratio 0.16%  0.11%    
Tier 1 Leverage Capital(1) 9.63%  8.68%    
Total Risk-based Capital(1) 15.58%  15.18%    
Book Value Per Share$11.80  $9.91     
Market Value Per Share$9.26  $10.50     
(1) Ratios are for Commercial Bank.       
        
Consolidated Statements of Income (unaudited):    
 Quarter Ended December 31, Year Ended December 31,
  2023   2022   2023   2022 
Interest Income$6,580,148  $6,190,953  $25,392,219  $23,422,328 
Interest Expense 2,014,110   1,101,926   7,026,000   3,005,219 
Net Interest Income 4,566,038   5,089,027   18,366,219   20,417,109 
Provision for loan losses (57,494)     (165,494)   
Non-interest income 456,500   490,764   1,998,998   2,207,795 
Operating Expenses 3,281,896   3,229,000   13,005,407   12,747,566 
Income before taxes 1,798,136   2,350,791   7,525,304   9,877,338 
Income tax expense 340,000   439,000   1,352,663   1,796,000 
Net Income$1,458,136  $1,911,791  $6,172,641  $8,081,338 
Net Income per share – diluted$0.37  $0.48  $1.56  $2.04 
Dividends declared$0.14  $0.14  $0.56  $0.56 
        
        
Consolidated Balance Sheets (unaudited):      
 December 31,    
  2023   2022     
Assets       
Cash and cash equivalents$32,942,957  $61,071,786     
Time deposits with other banks 3,735,000   8,960,000     
Securities 94,306,770   101,705,429     
Loans 417,403,567   411,293,661     
Allowance for loan losses (3,570,271)  (4,154,073)    
Loans, net 413,833,296   407,139,588     
Premises and equipment, net 9,252,193   8,795,376     
Other assets 25,090,633   26,082,215     
Total Assets$579,160,849  $613,754,394     
        
Liabilities       
Deposits$501,646,583  $538,732,322     
FHLB borrowings 14,000,000   19,000,000     
Trust preferred 13,403,000   13,403,000     
Other liabilities 3,301,371   3,305,797     
Total Liabilities 532,350,954   574,441,119     
        
Equity       
Total Equity 46,809,895   39,313,275     
Total Liabilities and Equity$579,160,849  $613,754,394     
        

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

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