HILLSDALE, Mich.--(BUSINESS WIRE)--Apr. 10, 2026-- CNB Community Bancorp, Inc. (OTCQX: CNBB), the parent company of County National Bank (the “Bank”), today announced earnings for the three months ended March 31, 2026. Earnings during the first quarter of 2026 totaled $3.0 million, an increase of $295,000, or 11.1%, compared to the $2.7 million earned during the three months ended March 31, 2025. Basic earnings per share for CNB Community Bancorp, Inc. (the “Company”) increased to $1.49 during the three months ended March 31, 2026, up $0.19 from $1.30 during the first quarter of 2025.

The annualized return on average assets (“ROA”) increased to 0.89% for the three months ended March 31, 2026, up 6 basis points, or 8.4%, from 0.83% for the three months ended March 31, 2025. The annualized return on average equity (“ROE”) increased to 11.11% for the current quarter, up from 10.63% for the first quarter of 2025. Book value per share increased to $54.58 at March 31, 2026, up $4.68, or 9.4%, from $49.90 at March 31, 2025.

Joseph R. Williams, President and Chief Executive Officer of CNB Community Bancorp, Inc. and County National Bank, stated, “The results for the first three months of 2026 were a significant improvement over the beginning of 2025. The improvement was due, in part, to a changing rate environment from which CNB was well positioned to benefit. Furthermore, our associates continued to develop relationships in all of the communities CNB serves. Therefore, our shareholders have seen improvements in book value, earnings per share, and market value over the last twelve months due to these efforts as well as our share repurchases.

CNB focuses on our Michigan communities, we understand that the international environment is impactful whether it is on the overall rate environment, the economic environment, or the international supply chain. However, I am positive in my thoughts on the fiscal strength of our communities and the fortitude of our nation. We will move past these times, and CNB is going to continue to lend and develop our deposit relationships in all of our communities in 2026 and beyond.”

Financial Highlights

• Total assets increased year-over-year $36.1 million, or 2.8%, to $1.33 billion compared to March 31, 2025, and increased $12.1 million, or 0.9% from December 31, 2025.
• Net loans increased $48.1 million, or 4.6%, to $1.09 billion at March 31, 2026, compared to $1.04 billion at March 31, 2025, and increased $4.5 million, or 0.4%, from December 31, 2025.
• Total deposits increased $6.0 million, or 0.5%, to $1.13 billion at March 31, 2026, compared to March 31, 2025, and increased $12.5 million, or 1.1% from December 31, 2025.
• Tangible book value per share increased $4.63, or 9.4%, to $53.27 at March 31, 2026, up from $48.64 at March 31, 2025, and up $0.87, or 1.7%, from $52.40 at December 31, 2025.
• The Company repurchased 26,582 shares in the first quarter of 2026 as part of the ongoing buyback announced earlier in 2026, paying $45.00 per share. Total shares outstanding are 2,010,690 as of March 31, 2026 compared to 2,038,598 at December 31, 2025.
• Net income increased $295,000, or 11.1%, to $3.0 million for the three-month period ended March 31, 2026, and basic EPS increased $0.19, or 14.4%, from $1.30 to $1.49 in the first quarter of 2026 in comparison to the first quarter of 2025.
• Net interest income for the first quarter of 2026 increased $1.1 million to $12.4 million from $11.3 million for the three months ended March 31, 2025.
• Pre-tax, pre-provision income increased $449,000 to $4.0 million in the first quarter of 2026, a 12.8% increase from the first quarter of 2025.

Balance Sheet Review

The Company’s assets totaled $1.33 billion at March 31, 2026, compared to $1.32 billion in assets at December 31, 2025, and $1.30 billion at March 31, 2025. The change in assets was resultant from an increase in lending to new and existing clients, along with additional debt securities purchased in the fourth quarter of 2025. The funding was derived from an increase in client deposits and additional borrowings along with an asset shift from cash to loans and debt securities.

Net loans totaled $1.09 billion at March 31, 2026, compared to $1.08 billion at December 31, 2025, and $1.04 billion at March 31, 2025. The loan portfolio at March 31, 2026, included: $621.5 million in commercial real estate loans, $255.7 million in commercial loans, $186.9 million in residential real estate loans, and $35.7 million in consumer loans.

Nonperforming assets (which are comprised of nonperforming loans and other real estate owned) at March 31, 2026, were $16.8 million, consistent with December 31, 2025, and an increase of $10.0 million, or 146.5%, from the $6.8 million at March 31, 2025. Nonperforming assets as a percentage of total assets slightly decreased to 1.26% at March 31, 2026, from 1.27% from December 31, 2025, and increased from 0.53% at March 31, 2025.

Nonperforming loans at March 31, 2026, were $16.5 million, a decrease of $35,000, or 0.2%, from the $16.6 million balance at December 31, 2025, and an increase of $9.7 million, or 142.9%, from the $6.8 million balance at March 31, 2025. Nonperforming loans as a percentage of total loans slightly decreased to 1.50% at March 31, 2026, from 1.51% at December 31, 2025, and increased from 0.65% at March 31, 2025. The year-over-year increase in nonperforming loans and assets were not particular to a specific industry or geographic area but rather a few larger credit relationships that are being worked out and, as such, have been classified as nonperforming.

During the first quarter of 2026, the Bank recorded a provision for credit losses of $275,000, which is a decrease of $1.5 million from $1.8 million recorded during the fourth quarter of 2025 and an increase of $85,000 from a provision of $190,000 recorded during the first quarter of 2025. Net recoveries totaled $41,000 during the first quarter of 2026 compared to net charge-offs of $2.4 million in the fourth quarter of 2025 and $5,000 in the first quarter of 2025.

Net charge-offs (annualized) as a percentage of average loans was 0.00% for the first quarter of 2026, 0.95% for the fourth quarter of 2025 and 0.00% for the first quarter of 2025. The allowance for credit losses totaled $12.4 million at March 31, 2026 compared to $12.1 million at December 31, 2025 and $13.4 million at March 31, 2025. The allowance for credit losses as a percentage of total loans increased to 1.12% at March 31, 2026, compared to 1.10% at December 31, 2025, and decreased from 1.27% at March 31, 2025. The allowance as a percentage of loans decreased year-over-year as a result of the $3.6 million in charge-offs in 2025, the increase in the loan portfolio, and certain inputs in the allowance calculation including loss history and overall economic conditions. The allowance will continue to be adjusted based upon the current and potential issues inherent in the portfolio.

Total investment securities exclusive of the Federal Home Loan Bank of Indianapolis, Federal Reserve Bank, and other stock without readily determined fair value, aggregated to $166.6 million at March 31, 2026, which is a decrease from $170.2 million at December 31, 2025, and an increase from $121.4 million at March 31, 2025. This decrease from year-end 2025 was a result of maturities of US Treasury securities and amortization of purchase premiums and paydowns of mortgage- backed securities. The year-over-year increase was due to the purchase of $62 million in debt securities related to a strategy of further leveraging the Bank’s balance sheet partially offset by the aforementioned maturities, amortization, and paydowns. While continued growth of the loan portfolio remains the primary focus for Bank management, the Bank will continue to manage the securities portfolio through prudent investment in securities that align with the Bank’s investment criteria when excess cash is available.

Noninterest bearing deposits have decreased by $16.1 million (7.4%) from $216.3 million at December 31, 2025, and decreased by $2.8 million (1.4%) from $203.0 million one year ago. Interest bearing deposits have increased from $901.2 million at December 31, 2025, and $921.0 million at March 31, 2025, to $929.8 million at March 31, 2026. Deposits are being impacted by the changing rate environment as the competition from higher yielding non-depository investment vehicles continues within the markets for consumer, commercial, and public fund deposits. The results have been a reallocation of deposits resulting in a reduction in noninterest-bearing deposits. Growth continues through ongoing efforts of our associates in retaining existing clients as well as expanding relationships within the communities that the Bank serves.

The Company’s outstanding borrowings decreased by $265,000 to $82.7 million at March 31, 2026, compared to $83.0 million at December 31, 2025, and increased by $23.6 million from $59.1 million at March 31, 2025. The decrease from year-end 2025 was due to the normal paydown of senior debt at the holding company. The increase from March 31, 2025, was the result of a borrowing at the Bank of $15.6 million and a $10.8 million borrowing at the holding company done in conjunction with the stock repurchase completed in the third quarter of 2025 and the aforementioned leverage strategy.

Total shareholders’ equity increased $335,000 (0.3%) from $107.8 million at December 31, 2025, and $5.9 million (5.8%) from $102.2 million a year ago. The $335,000 increase was mainly related to earnings during the first quarter of 2026 of $3.0 million, which was mostly offset by the repurchase of $1.2 million in holding company shares, an increase of $762,000 in the unrealized loss on available-for sale securities, and a $0.33 per share cash dividend totaling $664,000. On a year-over- year basis, the increase of $5.9 million in equity was predominately related to net income of $12.3 million and an increase in common stock from vesting of restricted shares and stock grants of $786,000. The partial offset was a result of the tender offers that have repurchased 85,722 shares at $3.9 million, the $3.0 million in dividends paid over the last twelve months to shareholders, and a $155,000 increase in the loss position of OCI from temporary market value adjustments to the securities portfolio.

Net Interest Income and Net Interest Margin

Net interest income, on a non-fully tax equivalent basis, was $12.4 million for the quarter ended March 31, 2026, up $1.1 million, or 9.5%, from $11.3 million during the first quarter of 2025. Interest income for the first quarter of 2026 increased $848,000, or 4.9%, from $17.3 million for the first quarter of 2025 to $18.1 million during the first quarter of 2026, mainly due to increases in rate and volume across the loan portfolio. Interest expense decreased $231,000 to $5.7 million for the first quarter of 2026 which was predominately resultant from a 9.0% decrease in cost of funds. This decrease was driven by certificates of deposit rates resetting at lower current market values along with overall decrease in rates on higher yielding money market and public funds accounts. The decrease was minimally offset by deposits continuing to transition to interest- bearing accounts from noninterest-bearing accounts as well as overall growth in deposits.

Net interest margin (“NIM”) is net interest income expressed as a percentage of average interest-earning assets. For the quarter ended March 31, 2026, the net interest margin on a fully taxable equivalent basis increased to 3.98% from 3.74% for the first quarter of 2025. Much of the change in margin has been a product of the market rates continuing to moderate with the cost of funds decreasing 9.0%, or 18 basis points, to 1.83% from 2.01%. Over that same period, the yield on earning assets slightly improved to 5.68% in the first quarter of 2026 from 5.67% during that same period in 2025.

Noninterest Income/Expense

During the three months ended March 31, 2026, noninterest income totaled $2.0 million, consistent with the three months ended March 31, 2025. Noninterest income was similar year-over-year without material changes to products or revenue.

Noninterest expense totaled $10.5 million during the three months ended March 31, 2026, an increase of $600,000 from the first quarter of 2025. The largest components of the year-over-year increase in noninterest expense were an increase compensation and benefits of $211,000 and occupancy and equipment expense of $166,000. The increase in associate related expense was driven by an increase in the number of associates as well as increases in expense for insurance and incentives. The increase in occupancy and equipment expense was mainly due to software expense increases across multiple different line items and renovation to the existing network of buildings owned or leased by the Bank.

About CNB Community Bancorp Inc.

CNB Community Bancorp, Inc. (OTCQX:CNBB) is a one-bank holding company. Its subsidiary bank, County National Bank (“CNB”), is a nationally chartered full-service community bank that also offers investment management and trust services and has been serving southern Michigan since 1934. The corporate headquarters are in Hillsdale, Michigan. CNB provides a wide array of financial products and services through its 13 full-service offices, three loan production offices, and 18 ATMs.

Safe Harbor Statement

This news release and other releases and reports issued by the Company may contain "forward-looking statements." The Company cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company is including this statement for purposes of taking advantage of the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995.

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Investor Contact:
Erik A. Lawson, CFO
erik.lawson@cnbb.bank 517-439-6115

Media Contact:
Craig S. Connor, Chairman of the Board
Joseph R. Williams, President & CEO

Source: CNB Community Bancorp, Inc.