CB Financial reports 1Q results

CARMICHAELS – CB Financial Services Inc., the holding company of Community Bank and Exchange Underwriters Inc., a wholly-owned insurance subsidiary of Community Bank, said Friday its non interest income increased $228,000, or 12.3 percent, to $2.1 million for the three months ended March 31, compared to $1.8 million for the three months ended March 31, 2016.
The company also saw total deposits grow by 3.9 percent to $725.5 million, compared to $698.2 million in the comparable period of a year ago.
The bank also saw its provision for loan losses decrease $430,000, or 50.6 percent, to $420,000 for the three months ended March 31, compared to $850,000 a year ago. The Carmichaels-based company said in a news release its first-quarter net income of $1.7 million for the three months ended March 31 compared to $2.0 million a year ago, a decrease of $341,000, or 16.7 percent.
Earnings per share decreased 8 cents, or 16.6 percent, to 42 cents for the most recent quarter, compared to 50 cents for the three months ended March 31, 2016.
The quarterly results benefited from an increase in non interest income related to additional commissions and fees, and contingency fees received by Exchange Underwriters.
Quarterly pre-tax income decreased by $469,000 due in part by the pre-tax gain recognized in the first quarter of 2016 because of the successful resolution of two problem commercial real estate loans. In the case of each of these loans, the Bank took ownership of the collateral, then sold one property at a gain and took the other property into fixed assets based on an appraised fair market value. The result of these two events had decreased OREO (other real estate owned assets) expense by $566,000 in the first quarter of 2016.
“The first quarter produced solid results, although the first quarter failed to enjoy the $566,000 pretax gain from the OREO transactions of the first quarter of 2016. Because of this and other factors, our net income in the current quarter is down compared to the prior year quarter” said CEO Barron P. McCune Jr.
“CB Financial Services recorded net income of $1.7 million in the first quarter, which represents projected annualized results of return on assets of 0.81 percent and return on equity of 7.66 percent.
“The local economy is improving as the Marcellus/Utica gas exploration activity picks up. Correspondingly, our commercial lending activity is picking up. We also have enjoyed a material increase in our deposits, as our deposit strategies have taken hold. “Our insurance subsidiary, Exchange Underwriters, also had an excellent first quarter. Our credit quality continues to be strong as nonperforming loans and nonperforming assets declined in the current quarter.
“Community Bank has weathered the last several quarters of a poor local economy in good shape. With increasing lending and deposit activity, as well as strong performance from EU, we are confident that the remainder of 2017 will yield positive results.”