Press Releases

Wellsboro, PA – Citizens & Northern Corporation (“C&N”) (NASDAQ: CZNC) announced its most recent dividend declaration and its unaudited, consolidated financial results for the three-month and six-month periods ended June 30, 2026. C&N’s principal activity is community banking, and its largest subsidiary is Citizens & Northern Bank (the “Bank”).

Referring to second quarter 2026 results, Brad Scovill, C&N’s President and CEO noted, “This was a really good bounce-back quarter from an earnings perspective with net income of $14.1 million or $0.79 per share. We had nice revenue growth, net interest margin expansion and loan recoveries in excess of charge-offs. You can see the positive contribution of the Susquehanna acquisition in the $11.5 million increase in year-to-date pre-tax, pre-provision net revenue over the amount for the first six months of 2025 and in the continued improvement in the efficiency ratio to 60% for the second quarter 2026. We made some progress in the second quarter on problem loan workouts as evidenced by our net recoveries and slightly improved non-performing loans and non-performing assets ratios.  While total loans receivable decreased at June 30, 2026 as compared to the prior quarter-end and year-end amounts due to pay-offs of a few larger commercial purpose loans, originations were reasonably strong. Based on our pipelines, we are optimistic about the prospects for profitable loan growth in the second half of this year.” 

Dividend Declared 

On July 23, 2026, C&N’s Board of Directors declared a regular quarterly cash dividend of $0.28 per share payable August 14, 2026, to shareholders of record as of August 3, 2026.

Highlights:

• Net income was $14,057,000, or $0.79 per diluted share for the second quarter 2026 as compared to $273,000, or $0.02 per diluted share in the first quarter 2026 and $6,117,000, or $0.40 per diluted share in the second quarter 2025. Net income for the six months ended June 30, 2026 was $14,330,000, or $0.81 diluted earnings per share, up from $12,410,000, or $0.80 diluted earnings per share for the first six months of 2025.
• Pre-tax, pre-provision net revenue (“PPNR”), a non-GAAP financial measure, was $15,815,000 for the second quarter 2026 as compared to $14,142,000 for the first quarter 2026 and $10,273,000 for the second quarter of 2025. PPNR was $29,957,000 for the six months ended June 30, 2026 as compared to $18,424,000 for the six months ended June 30, 2025. PPNR measures the strength of C&N’s core earnings from recurring operations independent of credit volatility. The higher PPNR results in the two most recent quarters include the net impact of growth in net interest income, noninterest income and noninterest expense resulting from C&N’s acquisition of Susquehanna Community Financial, Inc. (“Susquehanna”) on October 1, 2025. PPNR includes net interest income and noninterest income, net of noninterest expense, but excludes the (credit) provision for credit losses, realized gains or losses on securities, the income tax provision, merger-related expenses and other nonrecurring items included in earnings. See Table 12 for additional information.
• C&N recorded a credit for credit losses (reduction in expense) of $1,846,000 in the second quarter 2026 as compared to a provision for credit losses of $13,602,000 in the first quarter 2026. The credit for credit losses in the second quarter 2026 included the impact on the allowance for credit losses (“ACL”) of changes in qualitative factors, net recoveries of $403,000 and a reduction in loans receivable. In comparison, the provision for credit losses in the first quarter 2026 was primarily driven by the impact on the ACL of net charge-offs totaling $10,808,000. As described in more detail under Asset Quality, the elevated level of net charge-offs in the first quarter 2026 included a charge-off of $10,056,000 on a non-owner occupied commercial real estate loan. For the six months ended June 30, 2026, the provision for credit losses was $11,756,000, up from $2,590,000 for the first six months of 2025. 
• Net interest income for the second quarter 2026 increased $1,164,000 over the total for the first quarter 2026 and $8,476,000 over the total for second quarter 2025. For the first six months of 2026, net interest income was $16,955,000 higher than in the corresponding period of 2025. The net interest margin increased 0.09% to 4.07% for the second quarter 2026 from 3.98% for the first quarter 2026 and increased 0.55% from 3.52% for the second quarter 2025. The net interest margin increased 0.57% to 4.02% for the first six months of 2026 from 3.45% for the corresponding period of 2025. 
• Total loans receivable was $36,003,000 lower at June 30, 2026 compared to March 31, 2026, mainly due to  higher pay-downs and pay-offs of some larger commercial-purpose loans in the second quarter 2026. Average loans receivable increased $17,226,000, or 2.9% (annualized), for the second quarter 2026 as compared to the total for the first quarter 2026. Average loans receivable increased $473,193,000, or 24.9%, for the six months ended June 30, 2026 as compared to the first six months of 2025.
• At June 30, 2026, C&N’s highly liquid sources of available funds totaled $1.387 billion, or 169.1% of uninsured deposits and 212.6% of uninsured and uncollateralized deposits.

Balance Sheet 

• Total assets were $3,151,984,000 at June 30, 2026 down from $3,164,340,000 at March 31, 2026 and up from $2,610,875,000 at June 30, 2025. 
• Cash and due from banks totaled $82,537,000 at June 30, 2026, up from $54,798,000 at March 31, 2026 and down from $99,619,000 at June 30, 2025. 
• The fair value of available-for-sale debt securities totaled $496,829,000 at June 30, 2026, down from $497,367,000 at March 31, 2026 and up from $406,052,000 at June 30, 2025.  The increase in available-for-sale debt securities from June 30, 2025 included the impact of purchases of available-for-sale debt securities from funding provided by proceeds from the sale of most of the securities acquired from Susquehanna.
• Gross loans receivable totaled $2,348,847,000 at June 30, 2026, down $36,003,000 from total loans at March 31, 2026 and up $429,589,000 from total loans at June 30, 2025. On October 1, 2025, $393,587,000 of loans receivable were recorded pursuant to the acquisition of Susquehanna. The reduction in loans receivable at June 30, 2026 as compared to March 31, 2026 included a decrease of $16,396,000 in loans to political subdivisions and a decrease in commercial construction and land loans of $11,708,000. The reductions in outstanding loans to political subdivisions and commercial construction and land loans were caused primarily by pay-offs of one loan within each category. 
• Deposits totaled $2,603,735,000 at June 30, 2026, up $3,682,000 from March 31, 2026 and $493,959,000 from June 30, 2025. Deposits of $501,488,000 were assumed from Susquehanna, effective October 1, 2025. Average total deposits increased $17,245,000, or 2.7% (annualized) during the second quarter 2026 from the first quarter 2026 and were $493,355,000 or 23.8% higher for the six months ended June 30, 2026 as compared to the first six months of 2025.
• The outstanding balance of borrowed funds, including Federal Home Loan Bank advances, repurchase agreements, senior notes and subordinated debt, totaled $170,035,000 at June 30, 2026, down $23,011,000 from March 31, 2026 and $14,215,000 from June 30, 2025. On June 1, 2026, senior notes totaling $15,000,000 matured and were redeemed.  Also on June 1, 2026, the interest rate on subordinated notes totaling $25,000,000 adjusted from a fixed rate of 3.25% to a variable rate that will reset quarterly based on the Term Secured Overnight Financing Rate plus 259 basis points. At June 30, 2026, the interest rate on the outstanding subordinated notes was 6.25%. C&N is entitled to redeem the subordinated notes, in whole or in part, at any time on or after June 1, 2026, subject to regulatory approval to the extent required.
• Total stockholders’ equity was $346,139,000 at June 30, 2026, up from $335,564,000 at March 31, 2026 and $286,357,000 at June 30, 2025. 
• Within stockholders’ equity, the portion of accumulated other comprehensive loss related to available-for-sale debt securities was $24,284,000 at June 30, 2026, $25,096,000 at March 31, 2026 and $31,017,000 at June 30, 2025. The volatility in the fair value of the portfolio has resulted from changes in interest rates. Management reviewed the available-for-sale debt securities as of June 30, 2026 and concluded, as of such date, that there were no credit-related declines in fair value and no allowance for credit losses was recorded as of June 30, 2026. Accumulated other comprehensive losses are excluded from C&N’s regulatory capital ratios.

Asset Quality

• Total nonperforming assets as a percentage of total assets was 1.28% at June 30, 2026, down from 1.33% at March 31, 2026 and up from 1.06% at December 31, 2025 and 0.98% at June 30, 2025. Total nonperforming assets were $40,275,000 at June 30, 2026, down from $42,113,000 at March 31, 2026 and up from $33,113,000 at December 31, 2025 and $25,678,000 at June 30, 2025. The increase in nonperforming assets in 2026 from 2025 included the impact of a non-owner occupied, commercial real estate loan described in more detail below as nonaccrual at June 30 and March 31, 2026. Included in nonaccrual loans were loans purchased with credit deterioration (“PCD loans”) that were acquired as part of the Susquehanna merger on October 1, 2025 with a total amortized cost basis of $8,371,000 at June 30, 2026, $8,566,000 at March 31, 2026 and $6,762,000 at December 31, 2025.
• In the second quarter 2026, C&N recorded net recoveries totaling $403,000 or 0.07% (annualized) of average loans receivable compared to net charge-offs of $10,808,000 or 1.83% (annualized) of average loans receivable in the first quarter 2026 and net charge-offs of $548,000 or 0.12% (annualized) of average loans receivable in the second quarter 2025. During the second quarter of 2026, C&N recorded a $675,000 recovery on a loan classified as nonaccrual that was paid off by a borrower through third-party financing. The significant increase in charge-offs in the first quarter of 2026 was due to a non-owner occupied, commercial real estate loan originated in 2022 in the amount of $24 million of which $7,200,000 was participated with another financial institution. The loss of a large tenant as well as cash flow requirements of the borrower’s other properties (which C&N has not financed) caused the loan to be downgraded to substandard and placed on nonaccrual status as of June 30 and March 31, 2026. C&N obtained an updated appraisal in April 2026 which was significantly lower than the original appraisal when the loan was originated, resulting in a charge-off of $10,056,000 which was recorded in the first quarter 2026. In the second quarter 2026, C&N entered into a forbearance agreement with the borrower. During the second quarter 2026, the borrower made payments consistent with the terms of the forbearance agreement, including payments C&N recorded as reductions in the amortized cost basis of the loan totaling $171,000. At June 30, 2026, the amortized cost basis of the loan, net of the partial charge-off, is $5,665,000.
• For the six months ended June 30, 2026, net charge-offs totaled $10,405,000, or 0.88% (annualized) of average loans receivable as compared to net charge-offs of $639,000, or 0.07% (annualized) of average loans receivable for the first six months of 2025. The significant increase in charge-offs in the first six months of 2026 was due to the $10,056,000 charge-off on the non-owner occupied, commercial real estate loan discussed above.
• The ACL was 1.39% of gross loans receivable at June 30, 2026, down from 1.42% at March 31, 2026 and up from 1.32% at December 31, 2025 and 1.13% at June 30, 2025. The reduction in the ACL as a percentage of loans receivable at June 30, 2026 as compared to March 31, 2026 reflected the impact of a reduction in qualitative factors and in the portion of the ACL attributable to C&N’s net charge-off experience resulting from net recoveries during the second quarter 2026.

Capital

• On September 25, 2023, C&N announced a treasury stock repurchase program with no expiration that can be suspended or terminated by the Board of Directors, in its sole discretion. Under this program, C&N is authorized to repurchase up to 750,000 shares of its common stock. There were no shares repurchased during the first six months of 2026. At June 30, 2026, there were 723,465 shares available to be repurchased under the program.
• Tangible common book value per share , a non-GAAP financial measure, increased to $15.33 per share at June 30, 2026 from $14.73 per share at March 31, 2026 and $14.98 at June 30, 2025. The Corporation’s tangible common equity ratio, a non-GAAP financial measure, was 8.93% at June 30, 2026 compared to 8.53% at March 31, 2026 and 9.09% at June 30, 2025. See Table 14 and Table 15 for more information, including a reconciliation.
• C&N and the Bank are subject to various regulatory capital requirements. At June 30, 2026, Citizens & Northern Corporation and Citizens & Northern Bank maintained regulatory capital ratios that exceeded all capital adequacy requirements and were classified as well-capitalized.

Liquidity

• C&N maintained highly liquid sources of available funds totaling $1.387 billion at June 30, 2026, including unused borrowing capacity with the Federal Home Loan Bank of Pittsburgh of $971.1 million, unused availability on the Federal Reserve Bank of Philadelphia’s discount window of $24.9 million, available federal funds lines with other banks of $75 million and available-for-sale debt securities with a fair value in excess of collateral obligations of $316.1 million. At June 30, 2026, available funding from these sources totaled 169.1% of uninsured deposits, and 212.6% of uninsured and uncollateralized deposits. 
• At June 30, 2026, C&N’s estimated uninsured deposits totaled $820.2 million, or 31.4% of the Bank’s total deposits, as compared to $856.0 million, or 32.7% of the Bank’s total deposits at March 31, 2026 and $649.2 million, or 30.5% of the Bank’s total deposits at June 30, 2025. Included in uninsured deposits are deposits collateralized by securities (almost exclusively municipal deposits) totaling $167.8 million, or 6.4% of the Bank’s total deposits, at June 30, 2026 as compared to $171.3 million, or 6.5% of the Bank’s total deposits, at March 31, 2026 and $133.6 million, or 6.3% of the Bank’s total deposits at June 30, 2025.

Income Statement- Second Quarter 2026 as Compared to First Quarter 2026

Net Interest Income

• Net interest income of $29,618,000 in the second quarter 2026 increased $1,164,000 from the first quarter 2026 result. Average total earning assets increased $15,428,000 from the prior quarter, as average total loans receivable increased $17,226,000. Average total deposits increased $17,245,000 in the second quarter 2026 as compared to the total for the prior quarter. 
• Accretion of purchase accounting valuation adjustments related to the Susquehanna merger had a net positive impact on net interest income of $416,000 in the second quarter 2026 and $662,000 in the first quarter 2026.
• The net interest margin was 4.07% in the second quarter 2026, up 0.09% from 3.98% in the first quarter 2026. The net interest spread increased 0.10%, as the average yield on earning assets increased 0.04% and the average rate on interest-bearing liabilities decreased 0.06%.

(Credit) Provision for Credit Losses

• C&N recorded a credit for credit losses (reduction in expense) of $1,846,000 in the second quarter 2026 as compared to a provision for credit losses of $13,602,000 in the first quarter 2026. The credit for credit losses in the second quarter 2026 included the impact on the ACL of changes in qualitative factors, net recoveries of $403,000 and a reduction in loans receivable. In comparison, the provision for credit losses in the first quarter 2026 was primarily driven by the impact on the ACL of net charge-offs totaling $10,808,000. As described in more detail under Asset Quality, the elevated level of net charge-offs in the first quarter 2026 included a charge-off of $10,056,000 on a non-owner occupied commercial real estate loan. 

Noninterest Income

• Noninterest income of $9,800,000 in the second quarter 2026 increased $1,605,000 from the total for the first quarter 2026. Significant variances included the following:
  • Other noninterest income of $2,305,000 increased $719,000 mainly from an increase in tax credits related to donations. 
  • Net gains from sales of loans of $608,000 increased $238,000 reflecting an increase in volume of residential mortgage loans sold.
  • Brokerage and insurance revenue of $816,000 increased $228,000 due to an increase in sales volume.
  • Trust revenue of $2,242,000 increased $157,000, consistent with appreciation in the trading prices of many U.S. equity securities and an increase in new business.
  • Service charges on deposit accounts of $1,761,000 increased $111,000, reflecting an increase in volume of fees.

Noninterest Expense

• Noninterest expense of $23,839,000 in the second quarter of 2026 increased $1,127,000 from the first quarter 2026 total. Significant variances included the following:
  • Other noninterest expense of $4,799,000 increased $1,435,000 from the first quarter 2026. Within this category, donations expense increased $895,000, including the impact of donations totaling $933,000 made under the Pennsylvania Educational Improvement Tax Credit program in the second quarter which generated income from tax credits of $840,000. Also within this category, legal fees increased $184,000 as the first quarter total included a reduction in expense resulting from insurance proceeds related to claims paid and expensed in a prior period. Additionally, collections expense increased $90,000 and public company-related expenses increased $83,000.
  • Data processing expense was $200,000 lower than in the first quarter 2026, reflecting a $100,000 reduction in internet banking expenses and a $78,000 reduction in technology-related professional fees.
  • Net occupancy and equipment expenses were $163,000 lower than in first quarter 2026, including decreases in snow removal and light and power expenses.

Income Tax Provision

• The income tax provision of $3,368,000, or 19.3% of pre-tax income for the second quarter 2026 increased $3,306,000 from $62,000, or 18.5% of pre-tax income, for the first quarter 2026 reflecting an increase in pre-tax income for the quarter.

Other Information:

• Trust assets under management by C&N’s Wealth Management Group were $1,554,305,000 at June 30, 2026, up from $1,473,084,000 at March 31 2026, and up 12.6% from $1,380,547,000 at June 30, 2025. Fluctuations in values of assets under management reflect the impact of market volatility.
•  The outstanding balance of residential mortgage loans originated and serviced by C&N that have been sold to third parties was $454,642,000 at June 30, 2026, up $3,480,000 from March 31, 2026 and up $124,926,000 from the total at June 30, 2025, reflecting the impact of servicing obligations assumed on such loans that had been sold by Susquehanna prior to the merger. 

Citizens & Northern Corporation is the bank holding company for Citizens & Northern Bank, headquartered in Wellsboro, Pennsylvania, which operates 35 banking offices located in Bradford, Bucks, Cameron, Chester, Lancaster, Lycoming, McKean, Northumberland, Potter, Snyder, Sullivan, Tioga, Union and York Counties in Pennsylvania and Steuben County in New York, as well as a loan production office in Elmira, New York. Citizens & Northern Corporation trades on NASDAQ under the symbol “CZNC.” For more information about Citizens & Northern Bank and Citizens & Northern Corporation, visit www.cnbankpa.com.


Safe Harbor Statement: Except for historical information contained herein, the matters discussed in this release are forward-looking statements. Forward-looking statements can be identified by the use of words such as "may," "should," "will," "could," "estimates," "predicts," "potential," "continue," "anticipates," "believes," "plans," "expects," "future," "intends" and similar expressions that are intended to identify forward-looking statements.  Investors are cautioned that all forward-looking statements involve risks and uncertainty and are not guarantees of future performance.  Actual results may differ materially from those expressed in forward-looking statements. Factors that may affect future financial results include, without limitation, the following: changes in monetary and fiscal policies of the Federal Reserve Board and the U.S. Government, particularly related to changes in interest rates; changes in general economic conditions; the potential for adverse developments in the banking industry that could have a negative impact on customer confidence, sources of liquidity and capital funding, and regulatory responses to such developments; C&N’s credit standards and its on-going credit assessment processes might not protect it from significant credit losses; legislative or regulatory changes; downturn in demand for loan, deposit and other financial services in C&N’s market area; increased competition from other banks and non-bank providers of financial services; technological changes and increased technology-related costs; information security breach or other technology difficulties or failures; changes in accounting principles, or the application of generally accepted accounting principles; fraud and cyber malfunction risks as usage of artificial intelligence continues to expand; the integration of Susquehanna’s business and operations with those of C&N may divert the attention of the management teams of C&N and Susquehanna and cause a loss in the momentum of their ongoing businesses or have unanticipated adverse results on C&N’s or Susquehanna’s existing businesses, may take longer than anticipated and may be more costly than anticipated; the anticipated cost savings, operational efficiencies and other synergies of the Susquehanna merger may take longer to be realized or may not be achieved in their entirety, and attrition in key client, partner and other relationships relating to the Susquehanna merger may be greater than expected; success of C&N in Susquehanna’s geographic market area will require C&N to attract and retain key personnel in the market and to differentiate C&N from its competitors in the market; and Risk Factors identified in C&N’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Citizens & Northern disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether as a result of events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.