Company: CCNE
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0000736772-25-000087
Chunk: 96

Company: CNB FINANCIAL CORP/PA
Filing Date: 2025-05-07
Form: 10-Q
Item: Item 1
Chunk 96
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 average tangible common equity (non-GAAP) (annualized)8.15 %9.77 %Adjusted calculation of return on average equity (non-GAAP):Net income$11,481 $12,600 Add: Merger costs, net of tax (non-GAAP)1,487 — Adjusted net income (non-GAAP)$12,968 $12,600 Average shareholders' equity$619,409 $576,528 Adjusted return on average equity (GAAP) (annualized)8.49 %8.79 %Adjusted calculation of return on average tangible common equity (non-GAAP):Net income available to common shareholders$10,406 $11,525 Add: Merger costs, net of tax (non-GAAP)1,487 — Adjusted net income available to common shareholders$11,893 $11,525 Average tangible common shareholders' equity (non-GAAP)$517,550 $474,596 Adjusted return on average tangible common equity (non-GAAP) (annualized)9.32 %9.77 %

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ITEM 3

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The disclosures set forth in this item are qualified by Item 1A. Risk Factors and the section captioned "Forward-Looking Statements and Factors that Could Affect Future Results" included in this report, and other cautionary statements set forth elsewhere in this report.

As a financial institution, the Corporation's primary source of market risk exposure is interest rate risk, which influences fluctuations in the Corporation's future earnings due to changes in interest rates. This risk is closely correlated to the repricing characteristics of the Corporation's portfolio of assets and liabilities, with each asset or liability repricing either at maturity or during the instrument's life cycle.

The Corporation’s interest rate risk measurement philosophy focuses on maintaining an appropriate balance between the theoretical and the practical, especially given that the primary objective of the Corporation’s overall asset/liability management process is to assess the level of interest rate risk in the Corporation’s balance sheet. Therefore, the Corporation models a set of interest rate scenarios capturing the financial effects of a range of plausible rate scenarios. The collective impact of these scenarios is designed to enable the Corporation to understand the nature and extent of its sensitivity to interest rate changes. Doing so necessitates an assessment of rate changes over varying time horizons and of varying/sufficient degrees such that the impact of