CCFNB Bancorp : Press Release – For Immediate Release October 24, 2023 CCFNB Bancorp, Inc. Reports Third Quarter 2023 Earnings - Form 8-K

Press Release - For Immediate Release
October 24, 2023
CCFNB Bancorp, Inc. Reports Third Quarter 2023 Earnings

Bloomsburg, PA - CCFNB Bancorp, Inc. ("Corporation") (OTC Pink: CCFN), parent company of First Columbia Bank & Trust Co. ("Bank"), has released its unaudited financial statements for the third quarter of 2023.

Net income, as reported under U.S. Generally Accepted Accounting Principles, for the quarter-ended September 30, 2023, was $1,171,000 compared to $2,521,000 for the same period in 2022. Net income, as reported under U.S. Generally Accepted Accounting Principles, for the nine months-ended September 30, 2023 was $4,573,000 compared to $6,919,000 for the same period in 2022. Net income for the nine months-ended September 30, 2023 was impacted by merger related expenses amounting to approximately $1,206,000. Earnings per share, basic and diluted, for the quarters-ended September 30, 2023 and 2022 were $0.56 and $1.21, respectively. Earnings per share, basic and diluted, for the nine months-ended September 30, 2023 and 2022 were $2.20 and $3.33, respectively. The return on average assets and return on average equity were 0.63% and 6.78% for the quarter-ended September 30, 2023 as compared to 0.97% and 9.82% for the same period of 2022.

The net interest margin, tax effected, on interest earning assets and liabilities was 2.29% and 2.56% at September 30, 2023 and 2022, respectively.

Total consolidated assets amounted to $957.6 million at September 30, 2023 as compared to $944.0 at December 31, 2022. For the nine months-ended September 30, 2023, net loans, not held for sale, increased by $29.7 million while investment securities decreased $19.0 million and cash and cash equivalents increased $4.4 million to $17.4 million. Over the same time period, loans held for sale decreased $4.0 million. Total deposits decreased $41.8 million while short term borrowings increased $27.3 million and long term borrowings increased $25.0 million since the end of 2022.

The Corporation invests in various forms of agency debt including mortgage-backed securities and callable agency debt. The fair value of these securities is influenced by market interest rates, prepayment speeds on mortgage securities, bid to offer spreads in the market place and credit premiums for various types of agency debt. These factors change continuously and therefore the fair market value of these securities may be higher or lower than the Corporation's carrying value at any measurement date. The temporary impact on Investments will also affect Stockholders' Equity as these fluctuations are recorded through Accumulated Other Comprehensive Income (Loss). For the nine months ended September 30, 2023, the temporary impact of these unrealized losses on the Stockholders' Equity amounted to a reduction of $27.4 million. The Corporation does not consider its debt securities to be credit impaired since it has both the intent and ability to hold the securities until a recovery of fair value, which may be maturity.

When compared to December 31, 2022, stockholders' equity, excluding accumulated other comprehensive loss, increased $2.5 million to $115.8 million as of September 30, 2023. Total stockholders' equity equated to a book value per share of $42.50 at September 30, 2023 as compared with $41.34 as of December 31, 2022. For the nine months-ended September 30, 2023 cash dividends of $1.28 per share were paid to stockholders as compared to $1.25 for the same 2022 period. CCFNB Bancorp, Inc. remains well capitalized, with an equity to assets ratio of 9.20% as of September 30, 2023 and 9.10% at December 31, 2022.

About CCFNB Bancorp, Inc.

CCFNB Bancorp, Inc. is a registered financial holding company, headquartered in Bloomsburg, Pennsylvania. CCFNB Bancorp, Inc. has one subsidiary bank, First Columbia Bank & Trust Co. First Columbia Bank & Trust Co. is a full-service community bank, serving a market area in Columbia, Montour, Luzerne, Lycoming, and Northumberland counties. The Bank engages in a full line of personal, business and municipal financial services and alternative investment products, including corporate and personal fiduciary services. The Bank has 12 offices located throughout the communities of Bloomsburg, Berwick, Danville, Benton, Millville, Elysburg and Catawissa. The Bank has 177 employees. As of September 30, 2023, CCFNB Bancorp, Inc. had $957.6 million in total assets.

On October 3, 2023, shareholders of the Corporation and Muncy Bank Financial, Inc. ("Muncy"), each approved the merger of Muncy with and into the Corporation, with the Corporation as the surviving corporation, pursuant to the Agreement and Plan of Merger dated as of April 17, 2023, as amended June 21, 2023. In connection with the merger, Muncy's wholly-owned banking subsidiary, The Muncy Bank and Trust Company, will merge with and into the Corporation's wholly-owned bank subsidiary, First Columbia Bank & Trust Co. In connection with the mergers, the Corporation will change its name to Muncy Columbia Financial Corporation and First Columbia Bank & Trust Co. will change its name to Journey Bank. The mergers are expected to close on November 11, 2023, subject to certain customary closing conditions.

Cautionary Note Regarding Forward Looking Statements

This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of current or historical fact and involve substantial risks and uncertainties. Words such as "anticipates," "believes," "estimates," "expects," "forecasts," "intends," "plans," "projects," "may," "will," "should," and other similar expressions can be used to identify forward-looking statements. Such statements are subject to factors that could cause actual results to differ materially from anticipated results. Among the risks and uncertainties that could cause actual results to differ from those described in the forward-looking statements include, but are not limited to the following: costs or difficulties associated with newly developed or acquired operations; risks related to the proposed merger with Muncy Bank Financial, Inc.; changes in general economic trends, including inflation and changes in interest rates; increased competition; changes in consumer demand for financial services; our ability to control costs and expenses; adverse developments in borrower industries and, in particular, declines in real estate values; changes in and compliance with federal and state laws that regulate our business and capital levels; our ability to raise capital as needed; and the effects of the COVID-19 pandemic and actions taken by governments, businesses and individuals in response. We do not undertake, and specifically disclaim, any obligation to publicly revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements, except as required by law. Accordingly, you should not place undue reliance on forward-looking statements.

CCFNB Bancorp, Inc.

Consolidated Balance Sheets

(In Thousands, except share data)		(Unaudited) September 30, 2023			December 31, 2022
ASSETS
Cash and due from banks		$	8,209			$	9,750
Interest-bearing deposits in other banks			9,232				3,333
Federal funds sold			-				1
Total cash and cash equivalents			17,441				13,084
Investment debt securities, available-for-sale, at fair value			321,572				341,051
Investment equity securities, at fair value			812				1,077
Restricted securities			3,968				3,223
Loans held for sale			607				4,568
Loans, net of unearned income			556,255				527,729
Less: Allowance for credit losses			6,094				7,279
Loans, net			550,161				520,450
Premises and equipment:
Operating lease right-of-use			277				298
Other premises and equipment, net			12,467				12,514
Accrued interest receivable			2,664				2,222
Cash surrender value of bank-owned life insurance			22,239				21,859
Investment in limited partnerships			5,951				3,745
Goodwill			7,937				7,937
Other assets			11,484				11,986
TOTAL ASSETS		$	957,580			$	944,014
LIABILITIES
Interest-bearing deposits		$	474,687			$	500,480
Noninterest-bearing deposits			165,888				181,845
Total deposits			640,575				682,325
Short-term borrowings			199,083				171,741
Long-term borrowings			25,021				24
Accrued interest payable			518				187
Operating lease liability			277				298
Other liabilities			3,680				3,497
TOTAL LIABILITIES			869,154				858,072
STOCKHOLDERS' EQUITY
Common stock, par value $1.25 per share; authorized 15,000,000 shares, issued and outstanding 2,345,423 and 2,080,723 shares in 2023, respectively; and 2,343,835 and 2,079,135 shares in 2022, respectively			2,932				2,930
Surplus			30,092				30,030
Retained earnings			92,594				90,156
Accumulated other comprehensive loss			(27,402	)			(27,384	)
Treasury stock, at cost; 264,700 shares in 2023 and 2022			(9,790	)			(9,790	)
TOTAL STOCKHOLDERS' EQUITY			88,426				85,942
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$	957,580			$	944,014

CCFNB Bancorp, Inc.

Consolidated Statements of Income

(Unaudited)

		For the Three Months Ended			For the Nine Months Ended
(In Thousands, Except Share and Per Share Data)		September 30,			September 30,
		2023			2022			2023			2022
INTEREST AND DIVIDEND INCOME
Interest and fees on loans:
Taxable		$	6,629			$	5,418			$	18,861			$	15,033
Tax-exempt			243				157				674				460
Interest and dividends on investment securities:
Taxable			1,211				1,244				3,641				3,087
Tax-exempt			135				26				398				93
Dividend and other interest income			86				51				222				144
Federal funds sold			-				9				1				15
Deposits in other banks			84				174				169				262
TOTAL INTEREST AND DIVIDEND INCOME			8,388				7,079				23,966				19,094
INTEREST EXPENSE
Deposits			892				453				2,299				1,289
Short-term borrowings			2,337				673				6,248				930
Long-term borrowings			268				-				414				1
TOTAL INTEREST EXPENSE			3,497				1,126				8,961				2,220
NET INTEREST INCOME			4,891				5,953				15,005				16,874
CREDIT LOSS EXPENSE
(Credit) Provision for credit losses - loans			(172	)			(1,200	)			(594	)			(1,360	)
(Credit) Provision for credit losses - off-balance sheet commitments			4				-				1				-
TOTAL CREDIT LOSS EXPENSE			(168	)			(1,200	)			(593	)			(1,360	)
NET INTEREST INCOME AFTER (CREDIT) PROVISION FOR CREDIT LOSS EXPENSE			5,059				7,153				15,598				18,234
NON-INTEREST INCOME
Service charges and fees			477				572				1,516				1,576
Gain on sale of loans			68				75				193				431
Earnings on bank-owned life insurance			113				109				335				320
Brokerage			146				125				425				448
Trust			195				219				613				605
Loss on equity securities			(118	)			(17	)			(265	)			(60	)
Investment security losses, net			-				(1,236	)			-				(1,236	)
Interchange fees			428				428				1,294				1,285
Other			213				223				743				694
TOTAL NON-INTEREST INCOME			1,522				498				4,854				4,063
NON-INTEREST EXPENSE
Salaries			1,788				1,851				5,420				5,622
Employee benefits			487				753				1,887				2,257
Occupancy			326				336				969				1,007
Furniture and equipment			536				418				1,546				1,271
State shares tax			(58	)			177				234				521
Professional fees			363				274				985				914
Director's fees			72				71				227				238
FDIC assessments			110				64				327				195
Telecommunications			83				79				243				274
Automated teller machine and interchange			111				101				221				206
Merger related expenses			757				-				1,206				-
Other			698				544				1,682				1,525
TOTAL NON-INTEREST EXPENSE			5,273				4,668				14,947				14,030
INCOME BEFORE INCOME TAX PROVISION			1,308				2,983				5,505				8,267
INCOME TAX PROVISION			137				462				932				1,348
NET INCOME		$	1,171			$	2,521			$	4,573			$	6,919
EARNINGS PER SHARE, BASIC AND DILUTED		$	0.56			$	1.21			$	2.20			$	3.33
CASH DIVIDENDS PER SHARE		$	0.43			$	0.42			$	1.28			$	1.25
WEIGHTED AVERAGE SHARES OUTSTANDING			2,080,109				2,078,204				2,079,635				2,078,054

		Quarter Ended (unaudited)
(Dollars in Thousands, Except Per Share Data)		9/30/2023			6/30/2023			3/31/2023			12/31/2022			9/30/2022
Operating Highlights
Net income		$	1,171			$	1,462			$	1,940			$	2,595			$	2,521
Net interest income			4,891				4,913				5,201				5,453				5,953
(Credit) Provision for credit losses			(168	)			(16	)			(409	)			(450	)			(1,200	)
Non-interest income			1,522				1,706				1,626				2,008				498
Non-interest expense			5,273				4,857				4,817				5,038				4,668
Financial Condition Data:
Total assets		$	957,580			$	960,080			$	955,030			$	944,014			$	952,822
Loans, net and loans held for sale			556,862				544,593				535,843				525,018				506,760
Intangibles			7,937				7,937				7,937				7,937				7,937
Total deposits
Noninterest-bearing		$	165,888			$	175,521			$	178,438			$	181,845			$	182,469
Savings			155,750				157,833				166,231				171,462				174,173
NOW			146,944				152,358				151,191				152,656				156,961
Money Market			41,521				44,341				51,846				51,850				51,894
Time Deposits			130,472				128,430				127,670				124,512				129,900
Total interest-bearing deposits			474,687				482,962				496,938				500,480				512,928
Core deposits*			510,103				530,053				547,706				557,813				565,497
Selected Ratios
Net interest margin(YTD)			2.29	%			2.32	%			2.41	%			2.55	%			2.56	%
Annualized return on average assets			0.63	%			0.71	%			0.82	%			1.00	%			0.97	%
Annualized return on average equity			6.78	%			7.63	%			8.94	%			10.45	%			9.82	%
Capital Ratios
Common equity tier I capital ratio			19.76	%			19.30	%			19.83	%			19.79	%			20.77	%
Tier 1 capital ratio			19.76	%			19.30	%			19.83	%			19.79	%			20.77	%
Total risk-based capital ratio			20.87	%			20.45	%			20.99	%			21.04	%			22.03	%
Leverage ratio			11.05	%			10.83	%			11.11	%			11.02	%			10.74	%
Asset Quality Ratios
Non-performing assets		$	2,659			$	2,562			$	2,808			$	2,654			$	2,678
Allowance for credit losses - loans			6,094				6,278				6,288				7,279				7,743
Allowance for credit losses to total loans			1.09	%			1.14	%			1.16	%			1.37	%			1.51	%
Allowance for credit losses to non-performing loans			244.81	%			245.04	%			223.91	%			274.33	%			293.22	%
Per Share Data
Earnings per share		$	0.56			$	0.71			$	0.93			$	1.25			$	1.21
Dividend declared per share			0.43				0.43				0.42				0.42				0.42
Book value			42.50				43.44				44.52				41.34				39.88
Common stock price:
Bid		$	34.59			$	37.57			$	40.05			$	45.00			$	45.50
Ask			35.00				43.00				42.50				51.00				49.50
Weighted average common shares			2,080,109				2,079,649				2,079,135				2,078,705				2,078,204

* Core deposits are defined as total deposits less time deposits