10-Q - ACNB CORP (0000715579) (Filer)

Fri, May 9, 3:37 PM (13 days ago)

**ACNB Corporation (ACNB) Q1 2025 Financial Summary** **Company Overview:** ACNB Corporation, headquartered in Gettysburg, Pennsylvania, provides banking, wealth management, mortgage, and insurance services. The company operates through its subsidiaries, ACNB Bank and ACNB Insurance Services. **Q1 2025 Financial Performance:** - **Net Loss:** ACNB reported a net loss of $272,000 for Q1 2025, compared to a net income of $6.8 million in Q1 2024. The loss was primarily due to acquisition-related expenses and a provision for credit losses. - **Net Interest Income:** Increased by $6.5 million to $27.1 million, driven by the acquisition of Traditions Bancorp. - **Net Interest Margin:** Improved to 4.07% from 3.77% in Q1 2024, benefiting from acquisition accounting adjustments. - **Loan Growth:** Average loans increased by $499.3 million, driven by the acquisition. - **Deposit Growth:** Average interest-bearing deposits increased by $421.8 million. - **Noninterest Income:** Increased by $1.5 million to $7.2 million, driven by the acquisition and higher wealth management income. - **Noninterest Expenses:** Increased by $11.7 million to $29.3 million, primarily due to acquisition-related costs. - **Provision for Credit Losses:** Increased to $6.0 million, including an initial allowance for acquired loans. - **Asset Quality:** Non-performing loans increased to $10.0 million, or 0.43% of total loans, driven by the acquisition. **Key Ratios:** - **Return on Average Assets:** -0.04% (annualized) vs. 1.12% in Q1 2024. - **Return on Average Equity:** -0.31% (annualized) vs. 9.76% in Q1 2024. - **Allowance for Credit Losses to Total Loans:** 1.06% vs. 1.21% in Q1 2024. - **Non-performing Assets to Total Assets:** 0.32% vs. 0.18% in Q1 2024. **Acquisition Impact:** The acquisition of Traditions Bancorp contributed significantly to the changes in financial metrics, including increased loans, deposits, and expenses. The acquisition also resulted in a provision for credit losses and merger-related expenses. **Future Outlook:** ACNB's strategy focuses on increasing loan growth in local markets while maintaining a reasonable funding base. The company aims to manage interest rate risk through asset-liability management and derivative financial instruments. **Risk Factors:** ACNB faces risks related to economic conditions, competitive factors, regulatory changes, and market volatility. The company monitors these risks and adjusts its strategies accordingly. **Capital and Liquidity:** ACNB maintains strong capital ratios and liquidity positions, with sufficient funding sources to meet short- and long-term cash requirements. **Conclusion:** ACNB's Q1 2025 performance was impacted by the acquisition of Traditions Bancorp, resulting in increased expenses and a net loss. However, the company saw growth in loans, deposits, and noninterest income. ACNB remains focused on managing risks and maintaining a strong capital position.