CNB Financial(CCNE) - 2025 Q3 - Quarterly Report

Financial Performance - Total assets increased to $8,254,319 thousand as of September 30, 2025, up from $6,192,010 thousand at December 31, 2024, representing a growth of 33.4%[15] - Net income for Q3 2025 was $7,045,000, a decrease of 49.6% compared to $13,954,000 in Q3 2024[18] - Comprehensive income for Q3 2025 was $9,947,000, down from $24,048,000 in Q3 2024, reflecting a decline of 58.7%[18] - Net income for the nine months ended September 30, 2025, was $32,482 thousand, a decrease from $39,511 thousand in the same period of 2024, representing a decline of approximately 18.4%[22] - Basic earnings per common share for Q3 2025 was $0.22, down from $0.61 in Q3 2024, a decrease of 63.6%[17] - The company reported a significant increase in salaries to $15,597 million in Q3 2025, up from $13,726 million in Q3 2024, reflecting investment in human resources[192] Loan and Credit Quality - Net loans receivable rose to $6,400,512 thousand, compared to $4,561,599 thousand in the previous period, marking an increase of 40.3%[15] - Provision for credit loss expense significantly increased to $18,456,000 in Q3 2025 from $2,381,000 in Q3 2024, indicating a rise in expected credit losses[17] - The allowance for credit losses increased to $67,684 thousand from $47,357 thousand, indicating a rise of 42.9%[15] - The total provision for credit losses for the nine months ended September 30, 2025, was $5.936 billion, significantly impacting the overall financial performance[87] - The allowance for credit losses for owner-occupied, nonfarm nonresidential properties increased to $6.704 billion, reflecting a charge-off of $1.516 billion[87] - The Corporation's allowance for credit losses is influenced by loan volumes, risk rating migration, and economic forecasts[89] Deposits and Funding - Total deposits grew to $6,900,267 thousand, up from $5,371,364 thousand, reflecting a 28.5% increase[15] - The company experienced a net increase in checking, money market, and savings accounts of $155,024 thousand in 2025, compared to $70,861 thousand in 2024, indicating a growth of approximately 118.0%[22] - Brokered deposits increased to $261.9 million as of September 30, 2025, compared to $185.0 million at December 31, 2024[131] - Total loans pledged to the Federal Home Loan Bank (FHLB) were $3.6 billion as of September 30, 2025, up from $2.1 billion at December 31, 2024[134] Merger and Acquisition - The company is focused on integrating operations following the merger with ESSA Bancorp, Inc., aiming for expected synergies and efficiencies[12] - The acquisition of ESSA Bancorp and ESSA Bank contributed $202,549,000 to additional paid-in capital[19] - The total consideration paid to ESSA shareholders was approximately $202.6 million, consisting of about 8,359,430 shares valued at approximately $202.5 million and $21 thousand in cash for fractional shares[51] - The Corporation incurred merger and integration costs of $4.2 million for the three months and $6.0 million for the nine months ended September 30, 2025[52] Non-Interest Income and Expenses - Non-interest income totaled $10,566,000 in Q3 2025, slightly down from $10,973,000 in Q3 2024, showing a decrease of 3.7%[17] - Total non-interest expenses increased to $50,157,000 in Q3 2025, up from $38,784,000 in Q3 2024, marking a 29.4% rise[17] - Total non-interest income for the nine months ended September 30, 2025, was $28,081 million, slightly down from $28,793 million in the same period of 2024[192] Cash Flow and Investments - Net cash provided by operating activities decreased to $38,879 thousand in 2025 compared to $49,271 thousand in 2024, reflecting a decline of about 21.0%[22] - The company reported net cash provided by investing activities of $62,086 thousand in 2025, a significant improvement compared to a net cash used of $113,594 thousand in 2024[22] - Cash dividends declared for common stock were $12,885 thousand in 2025, compared to $11,134 thousand in 2024, representing an increase of approximately 15.7%[22] Asset Management - The total liabilities increased to $7,410,134 thousand, up from $5,581,315 thousand, representing a growth of 32.7%[15] - The total cash and cash equivalents at the end of September 2025 were $438,088 thousand, up from $360,909 thousand at the end of September 2024, marking an increase of approximately 21.4%[23] - The fair value of debt securities available-for-sale was $533.55 million as of September 30, 2025, with an amortized cost of $569.24 million[68] Risk Management - Future performance may be impacted by changes in interest rates and credit risks associated with lending activities[12] - The company anticipates potential challenges from economic conditions and competition affecting its operations and market position[12] - Significant uncertainty regarding the economy persists due to elevated interest rates and geopolitical conflicts, prompting management to evaluate expected credit losses proactively[90]