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Citizens Financial Services, Inc. Reports Unaudited Second Quarter 2018 Financial Results

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Citizens Financial Services, Inc. Reports Unaudited Second Quarter 2018 Financial Results

PR Newswire

MANSFIELD, Pa., July 25, 2018 /PRNewswire/ -- Citizens Financial Services, Inc. (OTC:CZFS), parent company of First Citizens Community Bank, released today its unaudited consolidated financial results for the three and six months ended June 30, 2018.

Highlights

  • Net income for the first six months of 2018 was $8.9 million, which is 32.0% higher than 2017's income through June 30, 2017. The first half of 2018 was positively impacted by the Tax Cuts and Jobs Act, enacted on December 22, 2017, which lowered the federal corporate income tax rate from 35% to 21% effective January 1, 2018. The effective tax rate for the first six months of 2018 was 15.4% compared to 22.4% in the comparable period in 2017.
  • Net income was $4.7 million for the three months ended June 30, 2018, which is 35.3% higher than the net income for 2017's comparable period. The effective tax rate for the three months ended June 30, 2018 was 15.7% compared to 23.0% in the comparable period in 2017.
  • Net interest income before the provision for loan losses of $23.2 million for the six months ended June 30, 2018 was an increase of $2.8 million, or 13.6%, over the same period a year ago.
  • Net loan growth totaled $38.9 million in the first half of 2018, or 7.9% annualized. During the second quarter of 2018, the Bank experienced approximately $15.0 million of payoffs from participation loans.
  • Return on average equity for the three and six months (annualized) ended June 30, 2018 was 13.68% and 13.15% compared to 10.80% and 10.63% for the three and six months (annualized) ended June 30, 2017.
  • Return on average tangible equity for the three and six months (annualized) ended March 31, 2018 was 16.74% and 16.14% compared to 13.16% and 12.98% for the three and six months (annualized) ended June 30, 2017. (See reconciliation of Non-GAAP measures at the end of the press release.)
  • Return on average assets for the three and six months (annualized) ended June 30, 2018 was 1.34% and 1.29% compared to 1.12% and 1.10% for the three and six months (annualized) ended June 30, 2017.

Six Months Ended June 30, 2018 Compared to 2017

  • For the six months ended June 30, 2018, net income totaled $8,938,000 which compares to net income of $6,771,000 for the first six months of 2017, an increase of $2,167,000 or 32.0%. Basic earnings per share of $2.55 for the first six months of 2018 compares to $1.93 for the first six months last year. Annualized return on equity for the six months ended June 30, 2018 and 2017 was 13.15% and 10.63%, while annualized return on assets was 1.29% and 1.10%, respectively.
  • Net interest income before the provision for loan loss for the six months ended June 30, 2018 totaled $23,171,000 compared to $20,401,000 for the six months ended June 30, 2017, resulting in an increase of $2,770,000, or 13.6%. Average interest bearing assets increased $152.9 million for the six months ended June 30, 2018 compared to the same period last year. Average loans increased $180.2 million while average investment securities decreased $30.4 million. The tax effected net interest margin for the six months ended June 30, 2018 was 3.67% compared to 3.79% for the same period last year. A significant portion of the margin decrease from 2017 to 2018 is attributable to the change in our corporate tax rate from 34% to 21%.
  • The provision for loan losses for the six months ended June 30, 2018 was $825,000 compared to $1,240,000 for the six months ended June 30, 2017, a decrease of $415,000. The decreased provision primarily reflects the lower level of loan growth experienced during 2018 compared to 2017.
  • Total non-interest income was $3,748,000 for the six months ended June 30, 2018, which is $175,000 less than the non-interest income of $3,923,000 for the same period last year. Decreases in security gains and gains on loans sold were offset by increases in service charge income and brokerage and insurance commissions.
  • Total non-interest expenses for the six months ended June 30, 2018 totaled $15,534,000 compared to $14,357,000 for the same period last year, which is an increase of $1,177,000, or 8.2%. Salaries and benefits increased $829,000 primarily due to merit increases and branch and loan production office expansion in our central and south central market areas. Occupancy expenses increased as a result of branch expansions. The efficiency ratio for 2018 is 55.12% compared to 55.39% for the comparable 2017 period.
  • The provision for income taxes decreased $334,000 when comparing the six months ended June 30, 2018 to the same period in 2017. The decrease is attributable to the Tax Cuts and Jobs Act, which lowered the statutory tax rate from 34% to 21%, partially offset by an increase in pre-tax income. The effective tax rate for the first six months of 2018 was 15.4% compared to 22.4% in the comparable period in 2017.

Three Months Ended June 30, 2018 Compared to 2017

  • For the three months ended June 30, 2018, net income totaled $4,691,000 which compares to net income of $3,468,000 for the comparable period in 2017, an increase of $1,223,000 or 35.3%. Basic earnings per share of $1.34 for three months ended June 30, 2018 compares to $0.99 for the 2017 comparable period. Annualized return on equity for the three months ended June 30, 2018 and 2017 was 13.68% and 10.80%, while annualized return on assets was 1.34% and 1.12%, respectively.
  • Net interest income before the provision for loan loss for the three months ended June 30, 2018 totaled $11,751,000 compared to $10,404,000 for the three months ended June 30, 2017, resulting in an increase of $1,347,000, or 12.9%. Average interest earning assets increased $149.8 million for the three months ended June 30, 2018 compared to the same period last year. Average loans increased $169.4 million while average investment securities decreased $22.0 million. The tax effected net interest margin for the three months ended June 30, 2018 was 3.70% compared to 3.82% for the same period last year, which was primarily impacted by the change in tax rates between periods.
  • The provision for loan losses for the three months ended June 30, 2018 was $325,000 compared to $625,000 for comparable period in 2017, a decrease of $300,000. The decreased provision primarily reflects the lower net loan growth experienced during the comparable three months of 2018 to 2017.
  • Total non-interest income was $1,842,000 for the three months June 30, 2018, which is $46,000 less than the comparable period last year. Decreases in investment securities gains and gains on loans sold were partially offset by increases in service charges and brokerage and insurance commissions.
  • Total non-interest expenses for the three months ended June 30, 2018 totaled $7,702,000 compared to $7,166,000 for the same period last year, which is an increase of $536,000, or 7.5%. Salaries and benefits increased $360,000 primarily due to the increased costs associated with merit increases and branch and loan production office expansion.
  • The provision for income taxes decreased $158,000 when comparing the three months ended June 30, 2018 to the same period in 2017. The effective tax rate for the three months ended June 30, 2018 was 15.7% compared to 23.0% in the comparable period in 2017.

Balance Sheet and Other Information:

  • At June 30, 2018, total assets were $1.40 billion, compared to $1.36 billion at December 31, 2017 and $1.26 billion at June 30, 2017.
  • Available for sale securities of $250.0 million at June 30, 2018 decreased $4.8 million from December 31, 2017 and $25.2 million from June 30, 2017. The decrease was utilized to fund growth in the loan portfolio.
  • Net loans as of June 30, 2018 totaled $1.03 billion and increased $38.9 million from December 31, 2017 and $150.2 million from June 30, 2017. Net loan growth for the second quarter was $8.1 million. Loan originations for the Bank remained strong in the second quarter, but growth was impacted by the pay-off of several large participation loans. The growth in 2018 was in commercial and agricultural relationships, which continues the trend from 2017.
  • The allowance for loan losses totaled $11,941,000 at June 30, 2018 which is an increase of $751,000 from December 31, 2017. The increase is due to recording a provision for loan losses of $825,000 and recoveries of $103,000, offset by charge-offs of $177,000. Annualized net charge-offs as a percent of total loans through June 30, 2018 was .02%. The allowance as a percent of total loans was 1.15% as of June 30, 2018 compared to 1.12% as of December 31, 2017.
  • Deposits increased $13.6 million from December 31, 2017, to $1.12 billion at June 30, 2018. Borrowed funds increased $19.0 million from December 31, 2017 to $133.7 million at June 30, 2018.
  • Stockholders' equity totaled $132.3 million at June 30, 2018, compared to $129.0 million at December 31, 2017, an increase of $3,270,000. The increase was attributable to net income for the six months ended June 30, 2018 totaling $8.9 million, offset by cash dividends of $3.0 million. As a result of changes in interest rates impacting the fair value of investment securities, the unrealized loss on available for sale investment securities, net of tax, increased $2.0 million from December 31, 2017.

Dividend Declared

On June 5, 2018, the Board of Directors declared a cash dividend of $0.435 per share, which was paid on June 29, 2018 to shareholders of record at the close of business on June 15, 2018. The quarterly cash dividend is an increase of 7.5% over the regular cash dividend of $0.405 per share declared one year ago, as adjusted for the 5% stock dividend declared in June 2017. The Board also declared a 1% stock dividend, payable on June 29, 2018 to shareholders of record at the close of business on June 15, 2018. 

Citizens Financial Services, Inc. has nearly 1,700 shareholders, the majority of whom reside in markets where its offices are located.

Note: This press release may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995.  These statements are not historical facts; rather, they are statements based on the Company's current expectations regarding its business strategies and their intended results and its future performance.  Forward-looking statements are preceded by terms such as "expects," "believes," "anticipates," "intends" and similar expressions.  Forward-looking statements are not guarantees of future performance.  Numerous risks and uncertainties could cause or contribute to the Company's actual results, performance and achievements to be materially different from those expressed or implied by the forward-looking statements. Factors that may cause or contribute to these differences include, without limitation, changes in general economic conditions, including changes in market interest rates and changes in monetary and fiscal policies of the federal government; legislative and regulatory changes; and other factors disclosed periodically in the Company's filings with the Securities and Exchange Commission.  Because of the risks and uncertainties inherent in forward-looking statements, readers are cautioned not to place undue reliance on them, whether included in this press release or made elsewhere periodically by the Company or on its behalf.  The Company assumes no obligation to update any forward-looking statements except as may be required by applicable law or regulation.

 

CITIZENS FINANCIAL SERVICES, INC.

CONSOLIDATED FINANCIAL HIGHLIGHTS

(UNAUDITED)

(Dollars in thousands, except per share data)


As of or For The

As of or For The


Three Months Ended

Six Months Ended


June 30

June 30


2018

2017

2018

2017

Income and Performance Ratios





Net Income 

$              4,691

$          3,468

$            8,938

$          6,771

Return on average assets (annualized)

1.34%

1.12%

1.29%

1.10%

Return on average equity (annualized)

13.68%

10.80%

13.15%

10.63%

Return on average tangible equity (annualized) (b)

16.74%

13.16%

16.14%

12.98%

Net interest margin (tax equivalent)

3.70%

3.82%

3.67%

3.79%

Earnings per share - basic (c)

$                1.34

$            0.99

$               2.55

$            1.93

Earnings per share - diluted (c)

$                1.34

$            0.99

$               2.55

$            1.93

Cash dividends paid per share 

$              0.435

$          0.401

$             0.870

$          0.802











Asset quality





Allowance for loan and lease losses

$            11,941

$          9,979

$          11,941

$          9,979

Non-performing assets

$            12,448

$        13,517

$          12,448

$        13,517

Allowance for loan and lease losses/total loans

1.15%

1.12%

1.15%

1.12%

Non-performing assets to total loans

1.20%

1.52%

1.20%

1.52%

Annualized net charge-offs (recoveries) to total loans

(0.01%)

0.02%

0.02%

0.03%











Equity





Book value per share (c)

$              39.18

$          36.54

$            39.18

$          36.54

Tangible Book value per share (b) (c)

$              32.05

$          30.00

$            32.05

$          30.00

Market Value (Last trade of month)

$              63.00

$          53.46

$            63.00

$          53.46

Common shares outstanding

3,512,653

3,489,164

3,512,653

3,489,164

Number of shares used in computation - basic (c)

3,507,242

3,514,394

3,509,882

3,513,925

Number of shares used in computation - diluted (c)

3,508,709

3,515,582

3,510,513

3,514,535











Other





Total Risk Based Capital Ratio (a)

13.23%

14.32%

13.23%

14.32%

Tier 1 Risk Based Capital Ratio (a)

12.04%

13.17%

12.04%

13.17%

Common Equity Tier 1 Risk Based Capital Ratio (a)

11.30%

12.33%

11.30%

12.33%

Leverage Ratio

8.94%

9.55%

8.94%

9.55%

Average Full Time Equivalent Employees

263.8

252.8

262.9

253.9

Loan to Deposit Ratio

92.99%

84.48%

92.99%

84.48%











Balance Sheet Highlights 

June 30,

December 31

June 30,



2018

2017

2017







Assets

$      1,397,594

$   1,361,886

$      1,264,856


Equity and available for sale securities

250,220

254,782

275,208


Loans (net of unearned income)

1,040,200

1,000,525

888,049


Allowance for loan losses

11,941

11,190

9,979


Deposits

1,118,592

1,104,943

1,051,209


Stockholders' Equity

132,281

129,011

127,770



(a) Presented as projected for June 30, 2018  and actual for the remaining period

(b) See reconcilation of Non-GAAP measures at the end of the press release

(c) Amounts were adjusted to reflect stock dividends.

 

 

CITIZENS FINANCIAL SERVICES, INC.




CONSOLIDATED BALANCE SHEET




(UNAUDITED)









June 30,

December 31

June 30,

(in thousands except share data)

2018

2017

2017

ASSETS:




Cash and due from banks:




  Noninterest-bearing

$           14,521

$         16,347

$         18,298

  Interest-bearing

1,092

2,170

1,064

Total cash and cash equivalents

15,613

18,517

19,362





Interest bearing time deposits with other banks

13,762

10,283

8,791





Equity securities

195

-

-





Available-for-sale securities

250,025

254,782

275,208





Loans held for sale

1,931

1,439

393





Loans (net of allowance for loan losses: $11,941 at June 30, 2018;




    $11,190 at December 31, 2017 and $9,979 at June 30, 2017)

1,028,259

989,335

878,070





Premises and equipment

16,289

16,523

16,771

Accrued interest receivable

4,285

4,196

3,697

Goodwill

23,296

23,296

21,089

Bank owned life insurance

27,189

26,883

26,556

Other intangibles

1,756

1,953

1,945

Other assets

14,994

14,679

12,974





TOTAL ASSETS

$      1,397,594

$    1,361,886

$    1,264,856





LIABILITIES:




Deposits:




  Noninterest-bearing

$         169,014

$       171,840

$       156,374

  Interest-bearing

949,578

933,103

894,835

Total deposits

1,118,592

1,104,943

1,051,209

Borrowed funds

133,652

114,664

69,998

Accrued interest payable

903

897

628

Other liabilities

12,166

12,371

15,251

TOTAL LIABILITIES

1,265,313

1,232,875

1,137,086

STOCKHOLDERS' EQUITY:




Preferred Stock $1.00 par value; authorized




  3,000,000 shares; none issued in 2018 or 2017

-

-

-

Common stock




  $1.00 par value; authorized 25,000,000 shares at June 30, 2018; 15,000,000 at     




  December 31, 2017 and June 30, 2017: issued 3,904,212 at June 30, 2018 and  3,869,939 




  at December 31, 2017 and June 30, 2017

3,904

3,870

3,870

Additional paid-in capital

53,098

51,108

51,085

Retained earnings

93,717

89,982

86,170

Accumulated other comprehensive loss

(5,357)

(3,398)

(969)

Treasury stock, at cost:  391,559 at June 30, 2018; 383,065 shares at December 31, 2017 




  and 380,775 shares at June 30, 2017

(13,081)

(12,551)

(12,386)

TOTAL STOCKHOLDERS' EQUITY

132,281

129,011

127,770

TOTAL LIABILITIES AND




   STOCKHOLDERS' EQUITY

$      1,397,594

$    1,361,886

$    1,264,856

 

 

CITIZENS FINANCIAL SERVICES, INC.





CONSOLIDATED STATEMENT OF INCOME





(UNAUDITED)






Three Months Ended

Six  Months Ended


June 30, 

June 30, 

(in thousands, except per share data)

2018

2017

2018

2017

INTEREST INCOME:





Interest and fees on loans

$     12,461

$    10,304

$     24,322

$    20,021

Interest-bearing deposits with banks

66

45

124

80

Investment securities:





    Taxable

916

775

1,716

1,579

    Nontaxable

474

601

1,001

1,269

    Dividends

111

53

248

129

TOTAL INTEREST INCOME

14,028

11,778

27,411

23,078

INTEREST EXPENSE:





Deposits

1,585

1,143

2,901

2,188

Borrowed funds

692

231

1,339

489

TOTAL INTEREST EXPENSE

2,277

1,374

4,240

2,677

NET INTEREST INCOME

11,751

10,404

23,171

20,401

Provision for loan losses

325

625

825

1,240

NET INTEREST INCOME AFTER





    PROVISION FOR LOAN LOSSES

11,426

9,779

22,346

19,161

NON-INTEREST INCOME:





Service charges

1,170

1,120

2,274

2,178

Trust

150

188

401

409

Brokerage and insurance

168

114

349

305

Gains on loans sold

60

148

132

249

Equity security gains, net

7

-

13

-

Available for sale security gains, net

-

23

-

195

Earnings on bank owned life insurance

155

167

307

333

Other

132

128

272

254

TOTAL NON-INTEREST INCOME

1,842

1,888

3,748

3,923

NON-INTEREST EXPENSES:





Salaries and employee benefits

4,737

4,377

9,572

8,743

Occupancy 

514

477

1,106

1,004

Furniture and equipment

122

146

264

285

Professional fees

262

258

557

568

FDIC insurance

107

95

207

200

Pennsylvania shares tax

300

243

600

524

Amortization of intangibles

74

73

150

149

ORE expenses

157

82

295

172

Other

1,429

1,415

2,783

2,712

TOTAL NON-INTEREST EXPENSES

7,702

7,166

15,534

14,357

Income before provision for income taxes

5,566

4,501

10,560

8,727

Provision for income taxes

875

1,033

1,622

1,956

NET INCOME

$       4,691

$      3,468

$       8,938

$      6,771






PER COMMON SHARE DATA:





Net Income - Basic

$          1.34

$        0.99

$          2.55

$        1.93

Net Income - Diluted

$          1.34

$        0.99

$          2.55

$        1.93

Cash Dividends Paid 

$       0.435

$      0.401

$       0.870

$      0.802






Number of shares used in computation - basic

3,507,242

3,514,394

3,509,882

3,513,925

Number of shares used in computation - diluted

3,508,709

3,515,582

3,510,513

3,514,535

 

 

CITIZENS FINANCIAL SERVICES, INC.






QUARTERLY CONDENSED, CONSOLIDATED INCOME STATEMENT INFORMATION





(UNAUDITED)






(in thousands, except per share data)


Three Months Ended,




June 30,

March 31,

Dec 31

Sep 30

June 30


2018

2018

2017

2017

2017

Interest income

$     14,028

$      13,383

$      12,895

$      12,120

$      11,778

Interest expense

2,277

1,963

1,659

1,503

1,374

Net interest income

11,751

11,420

11,236

10,617

10,404

Provision for loan losses

325

500

800

500

625

Net interest income after provision for loan losses

11,426

10,920

10,436

10,117

9,779

Non-interest income

1,838

1,900

1,981

1,912

1,865

Investment securities gains, net

4

6

831

9

23

Non-interest expenses

7,702

7,832

7,710

7,247

7,166

Income before provision for income taxes

5,566

4,994

5,538

4,791

4,501

Provision for income taxes

875

747

2,934

1,141

1,033

Net income

$       4,691

$        4,247

$        2,604

$        3,650

$        3,468

Earnings Per Share Basic

$         1.34

$          1.21

$          0.74

$          1.04

$          0.99

Earnings Per Share Diluted

$         1.34

$          1.21

$          0.74

$          1.04

$          0.99

 

 

CITIZENS FINANCIAL SERVICES, INC.

CONSOLIDATED AVERAGE BALANCES, INTEREST, YIELDS AND RATES, AND NET INTEREST MARGIN ON A FULLY TAX-EQUIVALENT BASIS

(UNAUDITED)


Three Months Ended June 30,


2018

2017


Average


Average

Average


Average


Balance (1)

Interest

Rate

Balance (1)

Interest

Rate

(dollars in thousands)

$

$

%

$

$

%

ASSETS







Interest-bearing deposits at banks

9,112

4

0.18

10,552

7

0.23

Interest bearing time deposits at banks

11,191

62

2.19

7,374

38

2.03

Investment securities

249,206

1,628

2.61

271,218

1,737

2.56

Loans:







  Residential mortgage loans

214,932

2,814

5.25

206,057

2,657

5.17

  Construction loans

23,349

273

4.69

26,258

269

4.12

  Commercial Loans

391,935

5,197

5.32

327,924

4,326

5.29

  Agricultural Loans

298,266

3,286

4.42

200,865

2,153

4.30

  Loans to state & political subdivisions

99,301

873

3.53

96,461

1,014

4.22

  Other loans

9,494

184

7.82

10,294

206

8.03

Loans, net of discount (2)(3)(4)

1,037,277

12,627

4.88

867,859

10,625

4.91

Total interest-earning assets

1,306,786

14,321

4.40

1,157,003

12,407

4.30

Cash and due from banks

6,529



6,538



Bank premises and equipment

16,356



16,888



Other assets

65,473



62,907



Total non-interest earning assets

88,358



86,333



Total assets

1,395,144



1,243,336



LIABILITIES AND STOCKHOLDERS' EQUITY







Interest-bearing liabilities:







  NOW accounts

330,550

404

0.49

328,055

294

0.36

  Savings accounts

189,457

51

0.11

180,042

47

0.10

  Money market accounts

160,719

365

0.91

128,931

160

0.50

  Certificates of deposit

268,526

765

1.14

261,368

642

0.98

Total interest-bearing deposits

949,252

1,585

0.67

898,396

1,143

0.51

Other borrowed funds

125,815

692

2.21

45,969

231

2.02

Total interest-bearing liabilities

1,075,067

2,277

0.85

944,365

1,374

0.58

Demand deposits

170,287



155,724



Other liabilities

12,617



14,820



Total non-interest-bearing liabilities

182,904



170,544



Stockholders' equity

137,173



128,427



Total liabilities & stockholders' equity

1,395,144



1,243,336



Net interest income


12,044



11,033


Net interest spread (5)



3.55%



3.72%

Net interest income as a percentage







  of average interest-earning assets



3.70%



3.82%

Ratio of interest-earning assets







  to interest-bearing liabilities



122%



123%


(1) Averages are based on daily averages.

(2) Includes loan origination and commitment fees.

(3) Tax exempt interest revenue is shown on a tax equivalent basis for proper comparison using

       a statutory federal income tax rate of 21% for 2018 and 34% for 2017.

(4) Income on non-accrual loans is accounted for on a cash basis, and the loan balances are included in interest-earning assets.

(5) Interest rate spread represents the difference between the average rate earned on interest-earning assets

      and the average rate paid on interest-bearing liabilities.




Three Months Ended




June 30, 


Reconciliation of net interest income on fully taxable equivalent basis


2018

2017


Total interest income


$     14,028

$       11,778


Total interest expense


2,277

1,374


Net interest income


11,751

10,404


Tax equivalent adjustment


293

629


Net interest income (fully taxable equivalent)


$     12,044

$       11,033


 

 

CITIZENS FINANCIAL SERVICES, INC.

CONSOLIDATED AVERAGE BALANCES, INTEREST, YIELDS AND RATES, AND NET INTEREST MARGIN ON A FULLY TAX-EQUIVALENT BASIS

(UNAUDITED)


Six Months Ended June 30,


2018

2017


Average


Average

Average


Average


Balance (1)

Interest

Rate

Balance (1)

Interest

Rate

(dollars in thousands)

$

$

%

$

$

%

ASSETS







Interest-bearing deposits at banks

8,609

9

0.21

9,106

9

0.20

Interest bearing time deposits at banks

10,753

115

2.16

7,123

71

2.01

Investment securities

259,425

3,232

2.49

289,807

3,630

2.51

Loans, net of discount (2)(3)(4)

1,027,778

24,667

4.84

847,600

20,664

4.92

Total interest-earning assets

1,306,565

28,023

4.33

1,153,636

24,374

4.26

Cash and due from banks

6,717



6,604



Bank premises and equipment

16,418



16,947



Other assets

54,590



55,850



Total non-interest earning assets

77,725



79,401



Total assets

1,384,290



1,233,037



LIABILITIES AND STOCKHOLDERS' EQUITY







Interest-bearing liabilities:







  NOW accounts

328,256

733

0.45

319,387

534

0.34

  Savings accounts

187,361

101

0.11

177,746

92

0.10

  Money market accounts

153,345

610

0.80

122,943

290

0.48

  Certificates of deposit

267,407

1,457

1.10

261,942

1,272

0.98

Total interest-bearing deposits

936,369

2,901

0.62

882,018

2,188

0.50

Other borrowed funds

132,179

1,339

2.04

57,348

489

1.72

Total interest-bearing liabilities

1,068,548

4,240

0.80

939,366

2,677

0.57

Demand deposits

167,255



151,396



Other liabilities

12,577



14,846



Total non-interest-bearing liabilities

179,832



166,242



Stockholders' equity

135,910



127,429



Total liabilities & stockholders' equity

1,384,290



1,233,037



Net interest income


23,783



21,697


Net interest spread (5)



3.53%



3.69%

Net interest income as a percentage







  of average interest-earning assets



3.67%



3.79%

Ratio of interest-earning assets







  to interest-bearing liabilities



122%



123%








(1) Averages are based on daily averages.

(2) Includes loan origination and commitment fees.

(3) Tax exempt interest revenue is shown on a tax equivalent basis for proper comparison using

       a statutory federal income tax rate of 21% for 2018 and 34% for 2017.

(4) Income on non-accrual loans is accounted for on a cash basis, and the loan balances are included in interest-earning assets.

(5) Interest rate spread represents the difference between the average rate earned on interest-earning assets

      and the average rate paid on interest-bearing liabilities.













Six Months Ended




June 30, 


Reconciliation of net interest income on fully taxable equivalent basis


2018

2017


Total interest income


$     27,411

$       23,078


Total interest expense


4,240

2,677


Net interest income


23,171

20,401


Tax equivalent adjustment


612

1,296


Net interest income (fully taxable equivalent)


$     23,783

$       21,697


 

 

CITIZENS FINANCIAL SERVICES, INC.

CONSOLIDATED SUMMARY OF LOANS BY TYPE; NON-PERFORMING ASSETS; and ALLOWANCE FOR LOAN LOSSES

(UNAUDITED)

(Excludes Loans Held for Sale)

(In Thousands)


June 30, 

March 31, 

December 31, 

September 30,

June 30, 


2018

2018

2017

2017

2017

Real estate:






  Residential

$     213,242

$      215,349

$       214,479

$ 206,389

$ 205,725

  Commercial

309,571

320,381

308,084

273,624

271,342

  Agricultural

262,691

248,710

239,957

207,052

188,547

  Construction

27,901

22,239

13,502

17,074

25,569

Consumer

9,740

9,672

9,944

10,784

10,603

Other commercial loans

75,002

74,930

72,013

56,222

56,952

Other agricultural loans

42,131

40,396

37,809

34,066

32,974

State & political subdivision loans

99,922

100,061

104,737

101,951

96,337

Total loans

1,040,200

1,031,738

1,000,525

907,162

888,049

Less allowance for loan losses

11,941

11,587

11,190

10,447

9,979

Net loans

$  1,028,259

$   1,020,151

$       989,335

$ 896,715

$ 878,070







Past due and non-performing assets












Total Loans past due 30-89 days and still accruing

$          5,143

$          5,660

$           3,489

$     3,360

$     2,927







Non-accrual loans

$       10,931

$        11,433

$         10,171

$   11,821

$   11,511

Loans past due 90 days or more and accruing

1,046

429

555

173

812

Non-performing loans

$       11,977

$        11,862

$         10,726

$   11,994

$   12,323

OREO

471

952

1,119

1,570

1,194

Total Non-performing assets

$       12,448

$        12,814

$         11,845

$   13,564

$   13,517




















3 Months 

3 Months 

3 Months 

3 Months 

3 Months 


Ended

Ended

Ended

Ended

Ended

Analysis of the Allowance for loan Losses

June 30,

March 31,

December 31,

September 30,

June 30,

(In Thousands)

2018

2018

2017

2017

2017

Balance, beginning of period

$       11,587

$        11,190

$         10,447

$     9,979

$     9,405

Charge-offs

(61)

(116)

(73)

(56)

(65)

Recoveries

90

13

16

24

14

Net (charge-offs) recoveries

29

(103)

(57)

(32)

(51)

Provision for loan losses

325

500

800

500

625

Balance, end of period

$       11,941

$        11,587

$         11,190

$   10,447

$     9,979

 

 

CITIZENS FINANCIAL SERVICES, INC.

Reconciliation of GAAP and Non-GAAP Financial Measures

(Dollars in thousands, except per share data)





As of 


June 30,


2018

2017

Tangible Equity



Stockholders Equity - GAAP

$   132,281

$     127,770

Accumulated other comprehensive loss

(5,357)

(969)

Intangible Assets

25,052

23,034

Non-GAAP Total Tangible Book Value

112,586

105,705

Shares outstanding adjusted for June 2018 stock Dividend

3,512,653

3,523,437

Tangible Book value per share

32.05

30.00

 

 

Cision View original content:http://www.prnewswire.com/news-releases/citizens-financial-services-inc-reports-unaudited-second-quarter-2018-financial-results-300686481.html

SOURCE Citizens Financial Services, Inc.

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