Citizens & Northern Corporation Reports $6.3 Million Net Income in Q1 2025

Citizens & Northern Corporation reported a net income of $6.3 million, or $0.41 per diluted share, for the first quarter of 2025, marking an increase from $5.3 million, or $0.35 per diluted share, in the same period of 2024. The corporation's net interest income rose to $20.2 million, up from $19.2 million year-over-year, driven by a higher net interest margin of 3.38%, compared to 3.29% in the prior year. The increase in net interest income was attributed to a rise in interest income from loans and deposits, with average total loans increasing by 2.2% to $1.9 billion and average total deposits growing by 3.0% to $2.1 billion.

The provision for credit losses decreased significantly to $236,000 in the first quarter of 2025 from $954,000 in the same quarter of 2024. This reduction reflects a lower net charge-off experience, which totaled $91,000 compared to $145,000 in the previous year. The allowance for credit losses as a percentage of gross loans was 1.06% at the end of the first quarter, consistent with the previous quarter but slightly higher than 1.07% a year earlier. Noninterest income also saw a modest increase, totaling $7.0 million, up from $6.7 million, with notable contributions from trust revenue and service charges on deposit accounts.

Operationally, Citizens & Northern Corporation has maintained a stable loan portfolio, with total loans reaching $1.9 billion as of March 31, 2025. The composition of the loan portfolio remains predominantly commercial, with commercial real estate loans accounting for 75% of the total. The corporation's nonperforming assets increased slightly to $24.3 million, representing 0.93% of total assets, up from 0.92% at the end of 2024. The corporation continues to monitor its loan relationships closely, particularly those that may require significant management attention.

In terms of strategic developments, Citizens & Northern Corporation announced an agreement to acquire Susquehanna Community Financial, Inc., which operates seven banking offices in Central Pennsylvania. This acquisition, expected to close in the fourth quarter of 2025, will allow Citizens & Northern to expand its geographic footprint and enhance its market presence. The transaction is subject to regulatory approvals and shareholder consent. The corporation's management believes that the acquisition will be accretive to earnings per share beginning in the first year after closing, although it acknowledges potential challenges in integration and realization of anticipated benefits.

Looking ahead, Citizens & Northern Corporation remains focused on maintaining its capital adequacy and liquidity positions, with total stockholders' equity reported at $281.8 million as of March 31, 2025. The corporation's capital ratios exceed regulatory requirements, positioning it well for future growth and operational stability. Management continues to evaluate market conditions and operational strategies to navigate potential risks, including interest rate fluctuations and economic uncertainties.