Company: CCNE
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0000736772-25-000087
Chunk: 52

Company: CNB FINANCIAL CORP/PA
Filing Date: 2025-05-07
Form: 10-Q
Item: Item 1
Chunk 52
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 Corporation pledged cash collateral to another financial institution with a balance of $573 thousand as of March 31, 2025 and $173 thousand as of December 31, 2024. This balance is included in cash and cash equivalents due from banks on the condensed consolidated balance sheets. The Corporation may require its customers to post cash or securities as collateral on its program of back-to-back swaps depending upon the specific facts and circumstances surrounding each loan and individual swap. In addition, certain language is included in the International Swaps and Derivatives Association agreement and loan documents where, in default situations, the Corporation is permitted to access collateral supporting the loan relationship to recover any losses suffered on the derivative asset or liability. The Corporation may be required to post additional collateral to swap counterparties in the future in proportion to potential increases in unrealized loss positions. Effective on September 30, 2023 the Corporation amended all of the back-to-back swap contracts to reference the 1-month SOFR plus a credit spread adjustment of 11.448 basis points "Fallback SOFR." The following table provides information about the amounts and locations of activity related to the back-to-back interest rate swaps within the Corporation’s condensed consolidated balance sheet as of March 31, 2025 and December 31, 2024:Fair ValueNotionalAmountAssetLiabilityMarch 31, 2025$65,509 $826 (a)$826 (b)December 31, 2024$65,629 $423 (a)$423 (b)(a)Reported in accrued interest receivable and other assets within the condensed consolidated balance sheets(b)Reported in accrued interest payable and other liabilities within the condensed consolidated balance sheetsRisk Participation AgreementsThe Corporation’s existing credit derivatives result from participation in or out of interest rate swaps provided by or to external lenders as part of loan participation arrangements, therefore, are not used to manage interest rate risk in the Corporation’s assets or liabilities. Derivatives not designated as hedges are not speculative and result from a service the Corporation provides to certain lenders which participate in loans.The Corporation entered into Risk Participation Agreement ("RPA") swaps with other financial institutions related to loans in which the Corporation is a participant in. The RPA provides credit protection to the financial institution should the borrower fail to perform on its interest rate derivative contract with the financial institution. The notional amount of this contingent agreement is $35.2 million as of March 31, 2025 and $21.3 million as of December