Citizens & Northern Corp · NASDAQ:CZNC
Citizens & Northern — Hershey Community Bank Forum 2016
20 slides from Citizens & Northern's conference presentation, Aug 9, 2016
Slide 1: Hershey Community Bank Forum 2016
August 9, 2016 Hershey Community Bank Forum 2016
Slide 2: Safe Harbor
Safe Harbor This presentation contains statements which, to the extent that they are not recitations of historical fact may constitute fo rwa rd - looking statements for purposes of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. Such forward - looking st
Slide 3: Franchise Overview
Franchise Overview • Citizens & Northern Corporation is a bank holding company with assets of approximately $1.2 billion, headquartered in Wellsboro, PA. Banking services are provided by its subsidiary, Citizens & Northern Bank, from 26 banking offices in Bradford, Cameron, Lycoming, McKean, Potter,
Slide 4: Summary Statistics June 30, 2016
Summary Statistics June 30, 2016 Total Assets: $1.2 Billion Net Loans: $719.9 Million Total Deposits: $968.0 Million Tangible Common Equity: $178.6 Million Tang. Common Equity / Tang. Assets: 14.65% Tier 1 Leverage Ratio: 14.19% Total Risk Based Capital: 23.47% NPAs 1 / Assets 1.40% LTM Return on Av
Slide 5: Current Footprint
Current Footprint [ 4 ] McKean Potter Steuben, NY Tioga Bradford Cameron Lycoming Sullivan
Slide 6: Strong Deposit Market Share in Legacy Markets
Strong Deposit Market Share in Legacy Markets [ 5 ] Source: FDIC Summary of Deposits, information as of June 30, 2015 County % of CZNC Deposits Market Rank Market Share (%) Number of Branches Bradford, PA 37.15% 1 32.71% 7 Tioga, PA 28.47% 2 37.89% 6 Lycoming, PA 13.59% 7 5.59% 6 Sullivan, PA 7.60%
Slide 7: Management Team
Management Team • Successful leadership transitions – Independent Director, Leo Lambert, appointed Chairman of the Board in October 2014 – Brad Scovill appointed President and CEO effective in March 2015 • All executive officers have 15+ years of banking experience [ 6 ] Name Position Years of Banki
Slide 8: Current Strategic Focus
Current Strategic Focus • Alignment to Drive Growth • Strategic Investments – Development of employees – Sales/relationship management system – Striving to be “best in class” with technology - based products • Evaluating New Market Opportunities – Targeting markets and individuals/teams for expansio
Slide 9: Current Strategic Focus
Current Strategic Focus • Capital Deployment – Current dividend yield of 4.88% – 2014 stock buyback program completed – New stock buyback program announced in April 2016 • Risk Management – Continue to strengthen enterprise risk management programs consistent with size and complexity of the company
Slide 10: Consistently High Earnings Performance
Consistently High Earnings Performance [ 9 ] Earnings Per Share Efficiency Ratio, Excluding Loss on Prepayment of Debt 1 ROAE ROAA 1) See calculations provided on supplemental schedule 2) Source: Company documents
Slide 11: Loan Portfolio Diversification
Loan Portfolio Diversification [ 10 ] Loan Portfolio - as of June 30, 2016 (Amounts in thousands) Amount % of Total Residential mortgage: Residential mortgage loans - first liens $315,191 43.3% Residential mortgage loans - junior liens 22,159 3.0% Home equity lines of credit 39,054 5.4% 1 - 4 Family
Slide 12: Investment Portfolio Available-for-Sale
Investment Portfolio Available - for - Sale [ 11 ] AFS Securities Portfolio - as of June 30, 2016 (Amounts in thousands ) Amortized Cost Fair Value FV % of Total Obligations of U.S. Government agencies $9,664 $ 9,781 2.3% Obligations of states and political subdivisions: Tax - exempt 110,702 116,056
Slide 13: Deposit Composition
Deposit Composition [ 12 ] Source: Company documents Deposits - as of June 30, 2016 (Amounts in thousands) Amount % of Total Noninterest - bearing demand $215,004 22.2% Interest - checking 187,325 19.4% Savings and money market 335,488 34.7% Time deposits of less than $100,000 153,987 15.9% Time dep
Slide 14: Wealth Management Division
Wealth Management Division • Largest Locally - based Wealth Management Department with Integrated Broker/Dealer and Insurance Sales • Team is comprised of over 30 professionals • $847 million in Trust assets under management at 6/30/16 • Trust and brokerage revenues totaled $2.7 million in six - mon
Slide 15: Very Strong Capital Position
Very Strong Capital Position High capital positions us for growth – organically and by entry into new markets via acquisition or other means [ 14 ] June 30, 2016 Actual Data Source: Company documents Basel III Requirements plus Capital Conservation Buffer Total RBC Ratio 10.5 Tier 1 Ratio 8.5 CET 1
Slide 16: CZNC & Custom Peer Comparison
CZNC & Custom Peer Comparison [ 15 ] LTM = Last 12 months Source: S&P Global Market Intelligence, a division of S&P Global. Note: All data from SEC or FRY - 9C filings as of the most recent date available. Custom peer represents 66 companies HQ in PA, NY, NJ and OH with year - end 2015 total assets
Slide 17: Investment Considerations
Investment Considerations • Leading market share among community banks in North Central Pennsylvania • Experienced Board and senior leadership team • Consistently high earnings performance, with diverse revenue sources • Very strong capital position • Significant loan growth in 2015 and the first si
Slide 18: Investment Considerations
Investment Considerations • Well - established trust and financial management team • Quarterly dividends declared of $0.26 per share in each of the last 11 quarters, resulting in an annualized yield of 4.88% 1 • Attractive currency with valuation of 144% of Tangible Book Value and 16.5x LTM EPS 1 •
Slide 19: Contact Information
Contact Information President and CEO: Brad Scovill BradleyS@cnbankpa.com; 570 - 723 - 2102 Treasurer and CFO: Mark Hughes MarkH@cnbankpa.com; 570 - 724 - 8533 Online: www.cnbankpa.com www.cntrustpa.com [ 18 ]
Slide 20: Supplemental Schedule
Supplemental Schedule Efficiency Ratio LTM Efficiency Ratio - Excluding Losses on Prepayment of Debt from Expenses (Amounts in thousands) 3rd Q 4th Q 1st Q 2nd Q 2015 2015 2016 2016 LTM Total noninterest expenses (a) $8,117 $8,416 $9,072 $8,535 $34,140 Net interest income 10,755 10,647 10,744 10,684
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