Exhibit 13.1
Five-Year Financial Summary  Selected Financial Data
 2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006(In thousands of dollars, except share and per share data)BALANCE SHEET INFORMATIONat December 31Assets
    
    $
    435,753
    
    
    $
    442,109
    
    
    $
    428,084
    
    
    $
    420,146
    
    
    $
    415,931Deposits
    
    
    376,790
    
    
    
    377,397
    
    
    
    357,031
    
    
    
    359,457
    
    
    
    355,169Loans, net of allowance for loan losses
    
    
    295,278
    
    
    
    308,911
    
    
    
    312,522
    
    
    
    295,678
    
    
    
    303,246Investments
    
    
    83,356
    
    
    
    80,973
    
    
    
    71,843
    
    
    
    73,676
    
    
    
    65,619Intangible assets
    
    
    254
    
    
    
    299
    
    
    
    344
    
    
    
    389
    
    
    
    434Goodwill
    
    
    2,046
    
    
    
    2,046
    
    
    
    2,046
    
    
    
    2,046
    
    
    
    2,046Short-term borrowings
    
    
    3,314
    
    
    
    3,207
    
    
    
    10,579
    
    
    
    5,431
    
    
    
    6,112Long-term debt
    
    
    
    
    
    
    5,000
    
    
    
    5,000
    
    
    
    
    
    
    
    Stockholders equity
    
    
    49,976
    
    
    
    50,603
    
    
    
    48,485
    
    
    
    48,572
    
    
    
    47,786Number of shares outstanding
    
    
    4,257,765
    
    
    
    4,337,587
    
    
    
    4,341,055
    
    
    
    4,409,445
    
    
    
    4,457,934Average for the yearAssets
    
    
    439,130
    
    
    
    435,285
    
    
    
    428,744
    
    
    
    424,847
    
    
    
    414,048Stockholders equity
    
    
    50,654
    
    
    
    49,514
    
    
    
    48,674
    
    
    
    47,635
    
    
    
    47,503Weighted average shares outstanding
    
    
    4,297,443
    
    
    
    4,341,097
    
    
    
    4,376,077
    
    
    
    4,434,859
    
    
    
    4,480,245INCOME STATEMENT INFORMATIONYears Ended December 31Total interest income
    
    $
    21,574
    
    
    $
    23,268
    
    
    $
    25,230
    
    
    $
    26,723
    
    
    $
    24,663Total interest expense
    
    
    5,502
    
    
    
    7,279
    
    
    
    9,057
    
    
    
    11,060
    
    
    
    10,111Net interest income
    
    
    16,072
    
    
    
    15,989
    
    
    
    16,173
    
    
    
    15,663
    
    
    
    14,552Provision for loan losses
    
    
    741
    
    
    
    627
    
    
    
    421
    
    
    
    120
    
    
    
    54Other income
    
    
    3,934
    
    
    
    4,171
    
    
    
    4,037
    
    
    
    4,199
    
    
    
    3,830Other expenses
    
    
    12,720
    
    
    
    12,619
    
    
    
    12,008
    
    
    
    12,209
    
    
    
    11,245Income before income taxes
    
    
    6,545
    
    
    
    6,914
    
    
    
    7,781
    
    
    
    7,533
    
    
    
    7,083Federal income tax expense
    
    
    1,630
    
    
    
    1,808
    
    
    
    2,057
    
    
    
    2,099
    
    
    
    2,081Net income
    
    $
    4,915
    
    
    $
    5,106
    
    
    $
    5,724
    
    
    $
    5,434
    
    
    $
    5,002PER SHARE DATAEarnings per share  basic
    
    $
    1.14
    
    
    $
    1.18
    
    
    $
    1.31
    
    
    $
    1.23
    
    
    $
    1.12Earnings per share  diluted
    
    
    1.14
    
    
    
    1.18
    
    
    
    1.31
    
    
    
    1.22
    
    
    
    1.11Cash dividends
    
    
    0.82
    
    
    
    0.78
    
    
    
    0.74
    
    
    
    0.95
    
    
    
    0.66Book value
    
    
    11.74
    
    
    
    11.67
    
    
    
    11.17
    
    
    
    11.02
    
    
    
    10.72FINANCIAL RATIOSReturn on average assets
    
    
    1.12
    %
    
    
    1.17
    %
    
    
    1.34
    %
    
    
    1.28
    %
    
    
    1.21
    %Return on average equity
    
    
    9.70
    
    
    
    10.31
    
    
    
    11.76
    
    
    
    11.41
    
    
    
    10.53Dividend payout
    
    
    71.72
    
    
    
    66.31
    
    
    
    56.62
    
    
    
    77.48
    
    
    
    59.12Average equity to average assets
    
    
    11.54
    
    
    
    11.38
    
    
    
    11.35
    
    
    
    11.21
    
    
    
    11.47Loans to deposits (year end)
    
    
    78.37
    
    
    
    81.85
    
    
    
    87.53
    
    
    
    82.26
    
    
    
    85.38




---



##### 



MANAGEMENTS DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 OVERVIEW
  FORWARD LOOKING STATEMENTS
  Nature of Operations




---



##### 



Economic and Industry-Wide Factors Relevant to Juniata
   Focus of Management
 Committed,
Capable, Caring Connected
 Shareholder Satisfaction
 committed connected capably
 Customer Relationships
 committed committed connection
 Balance Sheet Growth
 capable careful




---



##### 



Operating Results
 capable commitment capable
 Connection to the Community
 committed caring
 Juniatas Opportunities
 Soundness and stability
  Expansion of customer base
  Delivery system enhancements




---



##### 



Juniatas Challenges
 Economic recession
  Competition
  Rate environment
  Regulated Company
  APPLICATION OF CRITICAL ACCOUNTING POLICIES




---



##### 



RESULTS OF OPERATIONS
 2010
Financial Performance Overview
  2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006Return on average assets
    
    
    1.12
    %
    
    
    1.17
    %
    
    
    1.34
    %
    
    
    1.28
    %
    
    
    1.21
    %Return on average equity
    
    
    9.70
    
    
    
    10.31
    
    
    
    11.76
    
    
    
    11.41
    
    
    
    10.53Yield on earning assets
    
    
    5.42
    
    
    
    5.88
    
    
    
    6.48
    
    
    
    6.88
    
    
    
    6.43Cost to fund earning assets
    
    
    1.38
    
    
    
    1.84
    
    
    
    2.33
    
    
    
    2.85
    
    
    
    2.63Net interest margin (fully tax equivalent)
    
    
    4.24
    
    
    
    4.23
    
    
    
    4.34
    
    
    
    4.17
    
    
    
    3.91Noninterest income (excluding gains on
sales or calls of securities and securities
impairment charges) to average assets
    
    
    0.90
    
    
    
    1.01
    
    
    
    1.06
    
    
    
    0.99
    
    
    
    0.88Noninterest expense to average assets
    
    
    2.90
    
    
    
    2.90
    
    
    
    2.80
    
    
    
    2.87
    
    
    
    2.72Net noninterest expense to average assets
    
    
    2.00
    
    
    
    1.89
    
    
    
    1.74
    
    
    
    1.88
    
    
    
    1.84
  For the nine months ended September 30, 2010Net InterestROA
    
    
    ROE
    
    
    MarginJuniata Valley Financial Corp
    
    
    1.10
    %
    
    
    9.50
    %
    
    
    4.22
    %Peer Group Average
    
    
    0.89
    %
    
    
    9.93
    %
    
    
    3.48
    %




---



##### 



2010
    
    
    2009% of Average
    
    
    
    
    
    
    % of AverageAssets
    
    
    
    
    
    
    AssetsNet interest income
    
    $
    16,072
    
    
    
    3.66
    %
    
    $
    15,989
    
    
    
    3.67
    %Provision for loan losses
    
    
    (741
    )
    
    
    (0.17
    )
    
    
    (627
    )
    
    
    (0.14
    )Trust fees
    
    
    378
    
    
    
    0.09
    
    
    
    361
    
    
    
    0.08Deposit service fees
    
    
    1,428
    
    
    
    0.33
    
    
    
    1,673
    
    
    
    0.38BOLI
    
    
    510
    
    
    
    0.12
    
    
    
    444
    
    
    
    0.10Commissions from sales of non-deposit products
    
    
    358
    
    
    
    0.08
    
    
    
    446
    
    
    
    0.10Income from unconsolidated subsidiary
    
    
    250
    
    
    
    0.06
    
    
    
    217
    
    
    
    0.05Other fees
    
    
    940
    
    
    
    0.21
    
    
    
    935
    
    
    
    0.21Insurance-related income
    
    
    
    
    
    
    0.00
    
    
    
    323
    
    
    
    0.07Security gains and impairment charges
    
    
    (9
    )
    
    
    (0.00
    )
    
    
    (209
    )
    
    
    (0.05
    )Gains (losses) on sale of other assets
    
    
    79
    
    
    
    0.02
    
    
    
    (19
    )
    
    
    (0.00
    )Total noninterest income
    
    
    3,934
    
    
    
    0.90
    
    
    
    4,171
    
    
    
    0.96Employee expense
    
    
    (6,617
    )
    
    
    (1.51
    )
    
    
    (6,625
    )
    
    
    (1.52
    )Occupancy and equipment
    
    
    (1,504
    )
    
    
    (0.34
    )
    
    
    (1,552
    )
    
    
    (0.36
    )Data processing expense
    
    
    (1,397
    )
    
    
    (0.32
    )
    
    
    (1,325
    )
    
    
    (0.30
    )Director compensation
    
    
    (335
    )
    
    
    (0.08
    )
    
    
    (416
    )
    
    
    (0.10
    )Professional fees
    
    
    (515
    )
    
    
    (0.12
    )
    
    
    (392
    )
    
    
    (0.09
    )Taxes, other than income
    
    
    (469
    )
    
    
    (0.11
    )
    
    
    (476
    )
    
    
    (0.11
    )FDIC insurance premiums
    
    
    (534
    )
    
    
    (0.12
    )
    
    
    (634
    )
    
    
    (0.15
    )Intangible amortization
    
    
    (45
    )
    
    
    (0.01
    )
    
    
    (45
    )
    
    
    (0.01
    )Other noninterest expense
    
    
    (1,304
    )
    
    
    (0.30
    )
    
    
    (1,154
    )
    
    
    (0.27
    )Total noninterest expense
    
    
    (12,720
    )
    
    
    (2.90
    )
    
    
    (12,619
    )
    
    
    (2.90
    )Income tax expense
    
    
    (1,630
    )
    
    
    (0.37
    )
    
    
    (1,808
    )
    
    
    (0.42
    )Net income
    
    $
    4,915
    
    
    
    1.12
    %
    
    $
    5,106
    
    
    
    1.17
    %Average assets
    
    $
    439,130
    
    
    
    
    
    
    $
    435,285
 Net Interest Income




---



##### 



Table 1
AVERAGE BALANCE SHEETS AND NET INTEREST INCOME ANALYSIS
 Years Ended December 31,2010
    
    
    2009
    
    
    2008Average
    
    
    
    
    
    
    Yield/
    
    
    Average
    
    
    
    
    
    
    Yield/
    
    
    Average
    
    
    
    
    
    
    Yield/Balance (1)
    
    
    Interest
    
    
    Rate
    
    
    Balance (1)
    
    
    Interest
    
    
    Rate
    
    
    Balance (1)
    
    
    Interest
    
    
    RateASSETSInterest earning assets:Taxable loans (5)
    
    $
    292,748
    
    
    $
    19,003
    
    
    
    6.49
    %
    
    $
    300,913
    
    
    $
    20,429
    
    
    
    6.79
    %
    
    $
    298,947
    
    
    $
    21,774
    
    
    
    7.28
    %Tax-exempt loans
    
    
    14,480
    
    
    
    534
    
    
    
    3.69
    
    
    
    9,900
    
    
    
    358
    
    
    
    3.62
    
    
    
    8,659
    
    
    
    326
    
    
    
    3.76Total loans (8)
    
    
    307,228
    
    
    
    19,537
    
    
    
    6.36
    
    
    
    310,813
    
    
    
    20,787
    
    
    
    6.69
    
    
    
    307,606
    
    
    
    22,100
    
    
    
    7.18Taxable investment securities
    
    
    44,456
    
    
    
    973
    
    
    
    2.19
    
    
    
    39,571
    
    
    
    1,163
    
    
    
    2.94
    
    
    
    38,646
    
    
    
    1,666
    
    
    
    4.31Tax-exempt investment securities
    
    
    33,558
    
    
    
    1,016
    
    
    
    3.03
    
    
    
    34,793
    
    
    
    1,152
    
    
    
    3.31
    
    
    
    31,999
    
    
    
    1,082
    
    
    
    3.38Total investment securities
    
    
    78,014
    
    
    
    1,989
    
    
    
    2.55
    
    
    
    74,364
    
    
    
    2,315
    
    
    
    3.11
    
    
    
    70,645
    
    
    
    2,748
    
    
    
    3.89Interest bearing deposits
    
    
    3,596
    
    
    
    38
    
    
    
    1.06
    
    
    
    4,402
    
    
    
    158
    
    
    
    3.59
    
    
    
    6,389
    
    
    
    258
    
    
    
    4.04Federal funds sold
    
    
    9,166
    
    
    
    10
    
    
    
    0.11
    
    
    
    6,422
    
    
    
    8
    
    
    
    0.12
    
    
    
    4,846
    
    
    
    124
    
    
    
    2.56Total interest earning assets
    
    
    398,004
    
    
    
    21,574
    
    
    
    5.42
    
    
    
    396,001
    
    
    
    23,268
    
    
    
    5.88
    
    
    
    389,486
    
    
    
    25,230
    
    
    
    6.48Non-interest earning assets:Cash and due from banks
    
    
    10,109
    
    
    
    
    
    
    
    
    
    
    
    9,791
    
    
    
    
    
    
    
    
    
    
    
    10,167Allowance for loan losses
    
    
    (2,799
    )
    
    
    
    
    
    
    
    
    
    
    (2,524
    )
    
    
    
    
    
    
    
    
    
    
    (2,391
    )Premises and equipment
    
    
    6,981
    
    
    
    
    
    
    
    
    
    
    
    7,148
    
    
    
    
    
    
    
    
    
    
    
    5,968Other assets (7)
    
    
    26,835
    
    
    
    
    
    
    
    
    
    
    
    24,869
    
    
    
    
    
    
    
    
    
    
    
    25,514Total assets
    
    $
    439,130
    
    
    
    
    
    
    
    
    
    
    $
    435,285
    
    
    
    
    
    
    
    
    
    
    $
    428,744LIABILITIES
AND STOCKHOLDERS EQUITYInterest bearing liabilities:Interest bearing demand deposits (2)
    
    $
    75,991
    
    
    
    347
    
    
    
    0.46
    
    
    $
    68,847
    
    
    
    309
    
    
    
    0.45
    
    
    $
    72,051
    
    
    
    541
    
    
    
    0.75Savings deposits
    
    
    46,833
    
    
    
    230
    
    
    
    0.49
    
    
    
    40,705
    
    
    
    212
    
    
    
    0.52
    
    
    
    37,248
    
    
    
    362
    
    
    
    0.97Time deposits
    
    
    197,182
    
    
    
    4,810
    
    
    
    2.44
    
    
    
    209,779
    
    
    
    6,595
    
    
    
    3.14
    
    
    
    204,809
    
    
    
    7,992
    
    
    
    3.90Other, including short-term borrowings,
long-term debt and other
interest bearing liabilities
    
    
    7,914
    
    
    
    115
    
    
    
    1.45
    
    
    
    8,679
    
    
    
    163
    
    
    
    1.88
    
    
    
    10,253
    
    
    
    162
    
    
    
    1.58Total interest bearing liabilities
    
    
    327,920
    
    
    
    5,502
    
    
    
    1.68
    
    
    
    328,010
    
    
    
    7,279
    
    
    
    2.22
    
    
    
    324,361
    
    
    
    9,057
    
    
    
    2.79Non-interest bearing liabilities:Demand deposits
    
    
    55,656
    
    
    
    
    
    
    
    
    
    
    
    51,337
    
    
    
    
    
    
    
    
    
    
    
    49,137Other
    
    
    4,900
    
    
    
    
    
    
    
    
    
    
    
    6,424
    
    
    
    
    
    
    
    
    
    
    
    6,572Stockholders equity
    
    
    50,654
    
    
    
    
    
    
    
    
    
    
    
    49,514
    
    
    
    
    
    
    
    
    
    
    
    48,674Total liabilities
and stockholders equity
    
    $
    439,130
    
    
    
    
    
    
    
    
    
    
    $
    435,285
    
    
    
    
    
    
    
    
    
    
    $
    428,744Net interest income
    
    
    
    
    
    $
    16,072
    
    
    
    
    
    
    
    
    
    
    $
    15,989
    
    
    
    
    
    
    
    
    
    
    $
    16,173Net margin on interest earning assets (3)
    
    
    
    
    
    
    
    
    
    
    4.04
    %
    
    
    
    
    
    
    
    
    
    
    4.04
    %
    
    
    
    
    
    
    
    
    
    
    4.15
    %Net interest income and margin -
Tax equivalent basis (4)
    
    
    
    
    
    $
    16,870
    
    
    
    4.24
    %
    
    
    
    
    
    $
    16,767
    
    
    
    4.23
    %
    
    
    
    
    
    $
    16,898
    
    
    
    4.34
    %
  (1)
    
    Average balances were calculated using a daily average.(2)
    
    Includes Super Now and money market accounts.(3)
    
    Net margin on interest earning assets is net interest income divided by average interest
earning assets.(4)
    
    Interest on obligations of states and municipalities is not subject to federal income tax. In
order to make the net yield comparable on a fully taxable basis, a tax equivalent adjustment
is applied against the tax-exempt income utilizing a federal tax rate of 34%.




---



##### 



Table 2
RATE  VOLUME ANALYSIS OF NET INTEREST INCOME
 2010 Compared to 2009
    
    
    2009 Compared to 2008Increase (Decrease) Due To (6)
    
    
    Increase (Decrease) Due To (6)Volume
    
    
    Rate
    
    
    Total
    
    
    Volume
    
    
    Rate
    
    
    TotalASSETSInterest earning assets:Taxable loans (5)
    
    $
    (542
    )
    
    $
    (884
    )
    
    $
    (1,426
    )
    
    $
    141
    
    
    $
    (1,486
    )
    
    $
    (1,345
    )Tax-exempt loans
    
    
    169
    
    
    
    7
    
    
    
    176
    
    
    
    45
    
    
    
    (13
    )
    
    
    32Total loans
    
    
    (373
    )
    
    
    (877
    )
    
    
    (1,250
    )
    
    
    186
    
    
    
    (1,499
    )
    
    
    (1,313
    )Taxable investment securities
    
    
    132
    
    
    
    (322
    )
    
    
    (190
    )
    
    
    39
    
    
    
    (542
    )
    
    
    (503
    )Tax-exempt investment securities
    
    
    (40
    )
    
    
    (96
    )
    
    
    (136
    )
    
    
    92
    
    
    
    (22
    )
    
    
    70Total investment securities
    
    
    92
    
    
    
    (418
    )
    
    
    (326
    )
    
    
    131
    
    
    
    (564
    )
    
    
    (433
    )Interest bearing deposits
    
    
    (25
    )
    
    
    (95
    )
    
    
    (120
    )
    
    
    (73
    )
    
    
    (27
    )
    
    
    (100
    )Federal funds sold
    
    
    3
    
    
    
    (1
    )
    
    
    2
    
    
    
    30
    
    
    
    (146
    )
    
    
    (116
    )Total interest earning assets
    
    
    (303
    )
    
    
    (1,391
    )
    
    
    (1,694
    )
    
    
    274
    
    
    
    (2,236
    )
    
    
    (1,962
    )LIABILITIES
AND STOCKHOLDERS EQUITYInterest bearing liabilities:Interest bearing demand deposits (2)
    
    
    31
    
    
    
    7
    
    
    
    38
    
    
    
    (23
    )
    
    
    (209
    )
    
    
    (232
    )Savings deposits
    
    
    31
    
    
    
    (13
    )
    
    
    18
    
    
    
    31
    
    
    
    (181
    )
    
    
    (150
    )Time deposits
    
    
    (379
    )
    
    
    (1,406
    )
    
    
    (1,785
    )
    
    
    190
    
    
    
    (1,587
    )
    
    
    (1,397
    )Other, including short-term borrowings,
long-term debt and other
interest bearing liabilities
    
    
    (13
    )
    
    
    (35
    )
    
    
    (48
    )
    
    
    (27
    )
    
    
    28
    
    
    
    1Total interest bearing liabilities
    
    
    (330
    )
    
    
    (1,447
    )
    
    
    (1,777
    )
    
    
    171
    
    
    
    (1,949
    )
    
    
    (1,778
    )Net interest income
    
    $
    27
    
    
    $
    56
    
    
    $
    83
    
    
    $
    103
    
    
    $
    (287
    )
    
    $
    (184
    )
 (5)
    
    Non-accruing loans are included in the above table until they are charged off.(6)
    
    The change in interest due to rate and volume has been allocated to volume and rate changes
in proportion to the relationship of the absolute dollar amounts of the change in each.(7)
    
    Includes gross unrealized gains on securities available for sale: $1,429 in 2010, $1,118 in
2009 and $436 in 2008.(8)
    
    Interest income includes loan fees of $223, $202 and $347, in 2010, 2009 and 2008,
respectively.




---



##### 



Provision for Loan Losses
  Noninterest Income




---



##### 



Noninterest Expense




---



##### 



Income Taxes
  Net Income
  2010
    
    
    2009
    
    
    2008Net income
    
    $
    4,915
    
    
    $
    5,106
    
    
    $
    5,724Return on average assets
    
    
    1.12
    %
    
    
    1.17
    %
    
    
    1.34
    %Return on average equity
    
    
    9.70
    %
    
    
    10.31
    %
    
    
    11.76
    %
 Outlook for 2011




---



##### 



2009
Financial Performance Overview
   2009
    
    
    2008% of Average
    
    
    
    
    
    
    % of AverageAssets
    
    
    
    
    
    
    AssetsNet interest income
    
    $
    15,989
    
    
    
    3.67
    %
    
    $
    16,173
    
    
    
    3.77
    %Provision for loan losses
    
    
    (627
    )
    
    
    (0.14
    )
    
    
    (421
    )
    
    
    (0.10
    )Trust fees
    
    
    361
    
    
    
    0.08
    
    
    
    389
    
    
    
    0.09Deposit service fees
    
    
    1,673
    
    
    
    0.38
    
    
    
    1,660
    
    
    
    0.39BOLI
    
    
    444
    
    
    
    0.10
    
    
    
    486
    
    
    
    0.11Commissions from sales of non-deposit products
    
    
    446
    
    
    
    0.10
    
    
    
    704
    
    
    
    0.16Income from unconsolidated subsidiary
    
    
    217
    
    
    
    0.05
    
    
    
    207
    
    
    
    0.05Other fees
    
    
    935
    
    
    
    0.21
    
    
    
    875
    
    
    
    0.20Insurance-related income
    
    
    323
    
    
    
    0.07
    
    
    
    179
    
    
    
    0.04Security gains and impairment charges
    
    
    (209
    )
    
    
    (0.05
    )
    
    
    (521
    )
    
    
    (0.12
    )Gains (losses) on sale of other assets
    
    
    (19
    )
    
    
    (0.00
    )
    
    
    58
    
    
    
    0.01Total noninterest income
    
    
    4,171
    
    
    
    0.96
    
    
    
    4,037
    
    
    
    0.94Employee expense
    
    
    (6,625
    )
    
    
    (1.52
    )
    
    
    (6,451
    )
    
    
    (1.50
    )Occupancy and equipment
    
    
    (1,552
    )
    
    
    (0.36
    )
    
    
    (1,638
    )
    
    
    (0.38
    )Data processing expense
    
    
    (1,325
    )
    
    
    (0.30
    )
    
    
    (1,375
    )
    
    
    (0.32
    )Director compensation
    
    
    (416
    )
    
    
    (0.10
    )
    
    
    (417
    )
    
    
    (0.10
    )Professional fees
    
    
    (392
    )
    
    
    (0.09
    )
    
    
    (379
    )
    
    
    (0.09
    )Taxes, other than income
    
    
    (476
    )
    
    
    (0.11
    )
    
    
    (500
    )
    
    
    (0.12
    )FDIC insurance premiums
    
    
    (634
    )
    
    
    (0.15
    )
    
    
    (59
    )
    
    
    (0.01
    )Intangible amortization
    
    
    (45
    )
    
    
    (0.01
    )
    
    
    (45
    )
    
    
    (0.01
    )Other noninterest expense
    
    
    (1,154
    )
    
    
    (0.27
    )
    
    
    (1,144
    )
    
    
    (0.27
    )Total noninterest expense
    
    
    (12,619
    )
    
    
    (2.90
    )
    
    
    (12,008
    )
    
    
    (2.80
    )Income tax expense
    
    
    (1,808
    )
    
    
    (0.42
    )
    
    
    (2,057
    )
    
    
    (0.48
    )Net income
    
    $
    5,106
    
    
    
    1.17
    %
    
    $
    5,724
    
    
    
    1.34
    %Average assets
    
    $
    435,285
    
    
    
    
    
    
    $
    428,744
 Net Interest Income




---



##### 



Provision for Loan Losses
  Noninterest Income




---



##### 



Noninterest Expense
   Income Taxes
  Net Income
  2009
    
    
    2008
    
    
    2007Net income
    
    $
    5,106
    
    
    $
    5,724
    
    
    $
    5,434Return on average assets
    
    
    1.17
    %
    
    
    1.34
    %
    
    
    1.28
    %Return on average equity
    
    
    10.31
    %
    
    
    11.76
    %
    
    
    11.41
    %




---



##### 



FINANCIAL CONDITION
 Balance Sheet Summary
  Table 3
 2010
    
    
    
    
    
    
    
    
    
    
    2009
    
    
    
    
    
    
    
    
    
    
    2008Average
    
    
    Increase(Decrease)
    
    
    Average
    
    
    Increase(Decrease)
    
    
    AverageBalance
    
    
    Amount
    
    
    %
    
    
    Balance
    
    
    Amount
    
    
    %
    
    
    BalanceFunding Uses:Loans:Commercial
    
    $
    81,172
    
    
    $
    (4,573
    )
    
    
    (5.3
    %)
    
    $
    85,745
    
    
    $
    4,454
    
    
    
    5.5
    %
    
    $
    81,291Tax-exempt loans
    
    
    14,480
    
    
    
    4,580
    
    
    
    46.3
    
    
    
    9,900
    
    
    
    1,241
    
    
    
    14.3
    
    
    
    8,659Mortgage
    
    
    152,963
    
    
    
    3,383
    
    
    
    2.3
    
    
    
    149,580
    
    
    
    5,552
    
    
    
    3.9
    
    
    
    144,028Consumer, including Home Equity
    
    
    58,613
    
    
    
    (6,975
    )
    
    
    (10.6
    )
    
    
    65,588
    
    
    
    (8,040
    )
    
    
    (10.9
    )
    
    
    73,628Securities
    
    
    44,456
    
    
    
    4,885
    
    
    
    12.3
    
    
    
    39,571
    
    
    
    925
    
    
    
    2.4
    
    
    
    38,646Tax-exempt securities
    
    
    33,558
    
    
    
    (1,235
    )
    
    
    (3.5
    )
    
    
    34,793
    
    
    
    2,794
    
    
    
    8.7
    
    
    
    31,999Interest bearing deposits
    
    
    3,596
    
    
    
    (806
    )
    
    
    (18.3
    )
    
    
    4,402
    
    
    
    (1,987
    )
    
    
    (31.1
    )
    
    
    6,389Federal funds sold
    
    
    9,166
    
    
    
    2,744
    
    
    
    42.7
    
    
    
    6,422
    
    
    
    1,576
    
    
    
    32.5
    
    
    
    4,846Total interest earning assets
    
    
    398,004
    
    
    
    2,003
    
    
    
    0.5
    
    
    
    396,001
    
    
    
    6,515
    
    
    
    1.7
    
    
    
    389,486Investment in unconsolidated subsidiary
    
    
    3,443
    
    
    
    185
    
    
    
    5.7
    
    
    
    3,258
    
    
    
    181
    
    
    
    5.9
    
    
    
    3,077Bank-owned life insurance and annuities
    
    
    12,997
    
    
    
    182
    
    
    
    1.4
    
    
    
    12,815
    
    
    
    373
    
    
    
    3.0
    
    
    
    12,442Goodwill and intangible assets
    
    
    2,324
    
    
    
    (45
    )
    
    
    (1.9
    )
    
    
    2,369
    
    
    
    (45
    )
    
    
    (1.9
    )
    
    
    2,414Other non-interest earning assets
    
    
    23,732
    
    
    
    1,484
    
    
    
    6.7
    
    
    
    22,248
    
    
    
    (1,032
    )
    
    
    (4.4
    )
    
    
    23,280Unrealized gains on securities
    
    
    1,429
    
    
    
    311
    
    
    
    27.8
    
    
    
    1,118
    
    
    
    682
    
    
    
    156.4
    
    
    
    436Less: Allowance for loan losses
    
    
    (2,799
    )
    
    
    (275
    )
    
    
    (10.9
    )
    
    
    (2,524
    )
    
    
    (133
    )
    
    
    (5.6
    )
    
    
    (2,391
    )Total uses
    
    $
    439,130
    
    
    $
    3,845
    
    
    
    0.9
    %
    
    $
    435,285
    
    
    $
    6,541
    
    
    
    1.5
    %
    
    $
    428,744Funding Sources:Interest bearing demand deposits
    
    $
    75,991
    
    
    $
    7,144
    
    
    
    10.4
    %
    
    $
    68,847
    
    
    $
    (3,204
    )
    
    
    (4.4
    %)
    
    $
    72,051Savings deposits
    
    
    46,833
    
    
    
    6,128
    
    
    
    15.1
    
    
    
    40,705
    
    
    
    3,457
    
    
    
    9.3
    
    
    
    37,248Time deposits under $100,000
    
    
    158,951
    
    
    
    (10,460
    )
    
    
    (6.2
    )
    
    
    169,411
    
    
    
    3,132
    
    
    
    1.9
    
    
    
    166,279Time deposits over $100,000
    
    
    38,257
    
    
    
    (2,111
    )
    
    
    (5.2
    )
    
    
    40,368
    
    
    
    1,838
    
    
    
    4.8
    
    
    
    38,530Repurchase agreements
    
    
    3,051
    
    
    
    682
    
    
    
    28.8
    
    
    
    2,369
    
    
    
    (2,999
    )
    
    
    (55.9
    )
    
    
    5,368Short-term borrowings
    
    
    155
    
    
    
    (45
    )
    
    
    (22.5
    )
    
    
    200
    
    
    
    (2,179
    )
    
    
    (91.6
    )
    
    
    2,379Long-term debt
    
    
    3,548
    
    
    
    (1,452
    )
    
    
    (29.0
    )
    
    
    5,000
    
    
    
    3,552
    
    
    
    245.3
    
    
    
    1,448Other interest bearing liabilities
    
    
    1,160
    
    
    
    50
    
    
    
    4.5
    
    
    
    1,110
    
    
    
    52
    
    
    
    4.9
    
    
    
    1,058Total interest bearing liabilities
    
    
    327,946
    
    
    
    (64
    )
    
    
    (0.0
    )
    
    
    328,010
    
    
    
    3,649
    
    
    
    1.1
    
    
    
    324,361Demand deposits
    
    
    55,656
    
    
    
    4,319
    
    
    
    8.4
    
    
    
    51,337
    
    
    
    2,200
    
    
    
    4.5
    
    
    
    49,137Other liabilities
    
    
    4,874
    
    
    
    (1,550
    )
    
    
    (24.1
    )
    
    
    6,424
    
    
    
    (148
    )
    
    
    (2.3
    )
    
    
    6,572Stockholders equity
    
    
    50,654
    
    
    
    1,140
    
    
    
    2.3
    
    
    
    49,514
    
    
    
    840
    
    
    
    1.7
    
    
    
    48,674Total sources
    
    $
    439,130
    
    
    $
    3,845
    
    
    
    0.9
    %
    
    $
    435,285
    
    
    $
    6,541
    
    
    
    1.5
    %
    
    $
    428,744




---



##### 



Loans
  December 31,2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006Commercial, financial and agricultural
    
    $
    32,841
    
    
    $
    33,783
    
    
    $
    38,755
    
    
    $
    28,842
    
    
    $
    23,341Real estate  commercial
    
    
    44,185
    
    
    
    39,299
    
    
    
    32,171
    
    
    
    29,021
    
    
    
    29,492Real estate  construction
    
    
    11,028
    
    
    
    24,578
    
    
    
    22,144
    
    
    
    27,223
    
    
    
    29,489Real estate  mortgage
    
    
    142,608
    
    
    
    135,854
    
    
    
    140,016
    
    
    
    127,324
    
    
    
    132,572Home equity
    
    
    46,352
    
    
    
    52,957
    
    
    
    61,094
    
    
    
    63,960
    
    
    
    67,842Obligations of states and political
subdivisions
    
    
    10,960
    
    
    
    13,553
    
    
    
    7,177
    
    
    
    6,593
    
    
    
    5,129Personal
    
    
    10,155
    
    
    
    11,670
    
    
    
    13,920
    
    
    
    15,319
    
    
    
    18,545Unearned interest
    
    
    (27
    )
    
    
    (64
    )
    
    
    (145
    )
    
    
    (282
    )
    
    
    (592
    )Total
    
    $
    298,102
    
    
    $
    311,630
    
    
    $
    315,132
    
    
    $
    298,000
    
    
    $
    305,818
  2010
    
    
    2009
    
    
    2008Beginning balance
    
    $
    311,630
    
    
    $
    315,132
    
    
    $
    298,000New loans, net of repayments
    
    
    (12,063
    )
    
    
    (2,049
    )
    
    
    17,595Loans charged off
    
    
    (654
    )
    
    
    (529
    )
    
    
    (156
    )Loans transferred to other real estate owned and
other adjustments to carrying value
    
    
    (811
    )
    
    
    (924
    )
    
    
    (307
    )Net change
    
    
    (13,528
    )
    
    
    (3,502
    )
    
    
    17,132Ending balance
    
    $
    298,102
    
    
    $
    311,630
    
    
    $
    315,132




---



##### 



Table 4
Non-Performing Loans
 December 31,2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006(In thousands)Nonaccrual loans
    
    $
    5,964
    
    
    $
    2,629
    
    
    $
    1,255
    
    
    $
    
    
    
    $
    1,240Accruing loans past due 90 days or more
    
    
    1,007
    
    
    
    1,369
    
    
    
    664
    
    
    
    837
    
    
    
    214Restructured loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total non-performing loans
    
    $
    6,971
    
    
    $
    3,998
    
    
    $
    1,919
    
    
    $
    837
    
    
    $
    1,454




---



##### 



Allowance for Loan Losses
   Component for impaired loans:
   Component for contingencies:




---



##### 




    
    Historical trends: Historical net charge-offs are computed as a percentage of average
loans, by loan type. This percentage is applied to the ending period balance of the loan
type to determine the amount to be included in the allowance to cover charge-off
probability. This factor is computed on an annual basis, by major type of loan. It is a ten
year average of actual losses as a percentage of outstanding loan balances within the
groupings of homogeneous loans. This timeframe is used in order to include periods of
economic downturns and upturns;
 
    
    Individual loan performance: Management identifies a list of loans which are
individually assigned a risk rating grade because the loan has not performed according to
payment terms and there is reason to believe that repayment of the loan principal, in whole
or part, is unlikely. The specific portion of the allowance for these loans is the total
amount of potential losses for these individual loans which has not previously been charged
off;
 
    
    General economic environment: Current economic indicators are reviewed to assess the
level of change in risk in the loan portfolio due to possible changes in our customers
ability to repay debt. These indicators generally include:
 
    
    State and National unemployment rates, as well as local counties;
 
    
    Managements knowledge of the local economy, i.e. businesses moving in or closing down.
 
    
    Managements knowledge of other local events that could have an impact
on our borrowers ability to pay.
  
    
    Other relevant factors: Certain specific risks inherent in the loan portfolio are
identified and examined to determine if an additional allowance is warranted and, if so,
management assigns a percentage to the loan category. Such factors consist of:
 
    
    Credit concentration: Juniatas loans are classified in pre-defined
groups. Any groups total that exceeds 25% of the Banks total capital is
considered to be a credit concentration and as such, is determined to have an
additional level of associated risk. Any group that exceeds 15% of capital may be
assigned a factor, based upon managements assessment;
 
    
    Changes in loan volumes;
 
    
    Changes in experience, ability and depth of management; and
 
    
    External influences, such as competition, legal and regulatory requirements.




---



##### 



Years Ended December 31,2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006Balance of allowance  beginning of period
    
    $
    2,719
    
    
    $
    2,610
    
    
    $
    2,322
    
    
    $
    2,572
    
    
    $
    2,763Loans charged off:Commercial, financial and agricultural
    
    
    134
    
    
    
    47
    
    
    
    43
    
    
    
    291
    
    
    
    159Real estate  commercial
    
    
    
    
    
    
    32
    
    
    
    36
    
    
    
    
    
    
    
    Real estate  mortgage
    
    
    482
    
    
    
    343
    
    
    
    15
    
    
    
    66
    
    
    
    19Personal
    
    
    38
    
    
    
    107
    
    
    
    62
    
    
    
    61
    
    
    
    129Total charge-offs
    
    
    654
    
    
    
    529
    
    
    
    156
    
    
    
    418
    
    
    
    307Recoveries of loans previously charged off:Commercial, financial and agricultural
    
    
    
    
    
    
    
    
    
    
    5
    
    
    
    8
    
    
    
    5Real estate  mortgage
    
    
    
    
    
    
    
    
    
    
    5
    
    
    
    8
    
    
    
    Personal
    
    
    18
    
    
    
    11
    
    
    
    13
    
    
    
    32
    
    
    
    25Total recoveries
    
    
    18
    
    
    
    11
    
    
    
    23
    
    
    
    48
    
    
    
    30Net charge-offs
    
    
    636
    
    
    
    518
    
    
    
    133
    
    
    
    370
    
    
    
    277Provision for loan losses
    
    
    741
    
    
    
    627
    
    
    
    421
    
    
    
    120
    
    
    
    54Branch acquisition loan loss reserve
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    32Balance of allowance  end of period
    
    $
    2,824
    
    
    $
    2,719
    
    
    $
    2,610
    
    
    $
    2,322
    
    
    $
    2,572Ratio of net charge-offs during period to
average loans outstanding
    
    
    0.21
    %
    
    
    0.17
    %
    
    
    0.04
    %
    
    
    0.12
    %
    
    
    0.09
    %
  Allocation of the Allowance for Loan Losses (in thousands)2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006Commercial
    
    $
    1,026
    
    
    $
    993
    
    
    $
    707
    
    
    $
    660
    
    
    $
    864Real estate
    
    
    1,336
    
    
    
    1,146
    
    
    
    1,202
    
    
    
    933
    
    
    
    1,011Consumer
    
    
    462
    
    
    
    580
    
    
    
    701
    
    
    
    729
    
    
    
    697Unallocated
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total allowance for loan losses
    
    $
    2,824
    
    
    $
    2,719
    
    
    $
    2,610
    
    
    $
    2,322
    
    
    $
    2,572
 Percent of Loan Type to Total Loans2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006Commercial (non-real estate)
    
    
    14.7
    %
    
    
    15.2
    %
    
    
    14.6
    %
    
    
    11.9
    %
    
    
    9.3
    %Real estate
    
    
    81.9
    %
    
    
    81.1
    %
    
    
    81.0
    %
    
    
    83.0
    %
    
    
    84.6
    %Consumer
    
    
    3.4
    %
    
    
    3.7
    %
    
    
    4.4
    %
    
    
    5.1
    %
    
    
    6.1
    %100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %




---



##### 



Investments
  2010
    
    
    2009
    
    
    2008Beginning balance
    
    $
    82,255
    
    
    $
    72,036
    
    
    $
    81,946Purchases of investment securities
    
    
    53,198
    
    
    
    56,245
    
    
    
    36,063Sales and maturities of investment securities
    
    
    (49,754
    )
    
    
    (42,895
    )
    
    
    (38,996
    )Impairment charge
    
    
    (40
    )
    
    
    (226
    )
    
    
    (554
    )Adjustment in market value of AFS securities
    
    
    (544
    )
    
    
    131
    
    
    
    878Amortization/Accretion
    
    
    (293
    )
    
    
    (220
    )
    
    
    (126
    )Federal Home Loan Bank stock, net change
    
    
    (109
    )
    
    
    
    
    
    
    1,102Federal funds sold, net change
    
    
    11,100
    
    
    
    1,200
    
    
    
    (7,500
    )Interest bearing deposits with others, net change
    
    
    61
    
    
    
    (4,016
    )
    
    
    (777
    )Net change
    
    
    13,619
    
    
    
    10,219
    
    
    
    (9,910
    )Ending balance
    
    $
    95,874
    
    
    $
    82,255
    
    
    $
    72,036




---



##### 



December 31, 2010
    
    
    December 31, 2009
    
    
    December 31, 2008Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    WeightedSecurities
    
    Fair
    
    
    Average
    
    
    Fair
    
    
    Average
    
    
    Fair
    
    
    AverageType and maturity
    
    Value
    
    
    Yield
    
    
    Value
    
    
    Yield
    
    
    Value
    
    
    YieldU.S. Treasury securities and obligations of U.S.
Government agencies and corporationsWithin one year
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    21,851
    
    
    
    3.92
    %After one year but within five years
    
    
    34,783
    
    
    
    1.68
    %
    
    
    32,620
    
    
    
    2.31
    %
    
    
    3,117
    
    
    
    4.68
    %After five years but within ten years
    
    
    2,913
    
    
    
    1.72
    %
    
    
    933
    
    
    
    1.99
    %
    
    
    37,696
    
    
    
    1.68
    %
    
    
    33,553
    
    
    
    2.30
    %
    
    
    24,968
    
    
    
    4.01
    %Obligations of state and political subdivisionsWithin one year
    
    
    12,390
    
    
    
    4.21
    %
    
    
    6,863
    
    
    
    3.06
    %
    
    
    9,727
    
    
    
    4.98
    %After one year but within five years
    
    
    24,877
    
    
    
    3.57
    %
    
    
    32,972
    
    
    
    3.12
    %
    
    
    24,735
    
    
    
    4.72
    %After five years but within ten years
    
    
    1,626
    
    
    
    4.04
    %
    
    
    562
    
    
    
    3.23
    %
    
    
    1,053
    
    
    
    5.23
    %38,893
    
    
    
    3.79
    %
    
    
    40,397
    
    
    
    3.11
    %
    
    
    35,515
    
    
    
    4.81
    %Corporate Notes and OtherAfter one year but within five years
    
    
    1,028
    
    
    
    4.00
    %
    
    
    1,026
    
    
    
    4.00
    %
    
    
    957
    
    
    
    4.00
    %1,028
    
    
    
    4.00
    %
    
    
    1,026
    
    
    
    4.00
    %
    
    
    957
    
    
    
    4.00
    %Mortgage-backed securitiesWithin one year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    210
    
    
    
    4.58
    %After five years but within ten years
    
    
    1,345
    
    
    
    5.51
    %
    
    
    1,515
    
    
    
    5.43
    %
    
    
    1,657
    
    
    
    5.48
    %1,345
    
    
    
    5.51
    %
    
    
    1,515
    
    
    
    5.43
    %
    
    
    1,867
    
    
    
    5.38
    %Equity securities
    
    
    961
    
    
    
    
    
    
    
    865
    
    
    
    
    
    
    
    1,014$
    79,923
    
    
    
    
    
    
    $
    77,356
    
    
    
    
    
    
    $
    64,321
 Bank Owned Life Insurance and Annuities
  2010
    
    
    2009
    
    
    2008Beginning balance
    
    $
    13,066
    
    
    $
    12,582
    
    
    $
    12,344Bank-owned life insurance
    
    
    531
    
    
    
    530
    
    
    
    282Annuities
    
    
    (29
    )
    
    
    (46
    )
    
    
    (44
    )Net change
    
    
    502
    
    
    
    484
    
    
    
    238Ending balance
    
    $
    13,568
    
    
    $
    13,066
    
    
    $
    12,582




---



##### 



Investment in Unconsolidated Subsidiary
  Goodwill and Intangible Assets
  Deferred Taxes
  Other Non-Interest Earning Assets
  2010
    
    
    2009
    
    
    2008Beginning balance
    
    $
    32,194
    
    
    $
    25,378
    
    
    $
    24,771Cash and due from banks
    
    
    (5,855
    )
    
    
    6,349
    
    
    
    10Premises and equipment, net
    
    
    189
    
    
    
    (496
    )
    
    
    102Other real estate owned
    
    
    (64
    )
    
    
    171
    
    
    
    (6
    )Other receivables and prepaid expenses
    
    
    (1,281
    )
    
    
    792
    
    
    
    501Net change
    
    
    (7,011
    )
    
    
    6,816
    
    
    
    607Ending balance
    
    $
    25,183
    
    
    $
    32,194
    
    
    $
    25,378




---



##### 



Deposits
  2010
    
    
    2009
    
    
    2008Beginning balance
    
    $
    377,397
    
    
    $
    357,031
    
    
    $
    359,457Demand deposits
    
    
    5,666
    
    
    
    830
    
    
    
    5,445Interest bearing demand deposits
    
    
    5,612
    
    
    
    13,667
    
    
    
    (12,722
    )Savings deposits
    
    
    4,576
    
    
    
    5,422
    
    
    
    3,237Time deposits, $100,000 and greater
    
    
    (4,354
    )
    
    
    (606
    )
    
    
    2,751Time deposits, other
    
    
    (12,107
    )
    
    
    1,053
    
    
    
    (1,137
    )Net change
    
    
    (607
    )
    
    
    20,366
    
    
    
    (2,426
    )Ending balance
    
    $
    376,790
    
    
    $
    377,397
    
    
    $
    357,031
  2010
    
    
    
    
    
    
    
    
    
    
    2009
    
    
    
    
    
    
    
    
    
    
    2008Average
    
    
    Increase(Decrease)
    
    
    Average
    
    
    Increase(Decrease)
    
    
    AverageBalance
    
    
    Amount
    
    
    %
    
    
    Balance
    
    
    Amount
    
    
    %
    
    
    BalanceIndexed money market deposits
    
    $
    29,137
    
    
    $
    6,700
    
    
    
    29.9
    %
    
    $
    22,437
    
    
    $
    (4,957
    )
    
    
    (18.1
    )%
    
    $
    27,394Interest bearing demand deposits
    
    
    46,854
    
    
    
    444
    
    
    
    1.0
    
    
    
    46,410
    
    
    
    1,753
    
    
    
    3.9
    
    
    
    44,657Savings deposits
    
    
    46,833
    
    
    
    6,128
    
    
    
    15.1
    
    
    
    40,705
    
    
    
    3,457
    
    
    
    9.3
    
    
    
    37,248Demand deposits
    
    
    55,656
    
    
    
    4,319
    
    
    
    8.4
    
    
    
    51,337
    
    
    
    2,200
    
    
    
    4.5
    
    
    
    49,137Total core (transaction) accounts
    
    
    178,480
    
    
    
    17,591
    
    
    
    10.9
    
    
    
    160,889
    
    
    
    2,453
    
    
    
    1.5
    
    
    
    158,436Time deposits, $100,000 and greater
    
    
    38,257
    
    
    
    (2,111
    )
    
    
    (5.2
    )
    
    
    40,368
    
    
    
    1,838
    
    
    
    4.8
    
    
    
    38,530Time deposits, other
    
    
    158,951
    
    
    
    (10,460
    )
    
    
    (6.2
    )
    
    
    169,411
    
    
    
    3,132
    
    
    
    1.9
    
    
    
    166,279Total time deposits
    
    
    197,208
    
    
    
    (12,571
    )
    
    
    (6.0
    )
    
    
    209,779
    
    
    
    4,970
    
    
    
    2.4
    
    
    
    204,809Total deposits
    
    $
    375,688
    
    
    $
    5,020
    
    
    
    1.4
    %
    
    $
    370,668
    
    
    $
    7,423
    
    
    
    2.0
    %
    
    $
    363,245




---



##### 



Other Interest Bearing Liabilities
  
 2010
    
    
    
    
    
    
    
    
    
    
    2009
    
    
    
    
    
    
    
    
    
    
    2008Average
    
    
    Increase(Decrease)
    
    
    Average
    
    
    Increase(Decrease)
    
    
    AverageBalance
    
    
    Amount
    
    
    %
    
    
    Balance
    
    
    Amount
    
    
    %
    
    
    BalanceRepurchase agreements
    
    $
    3,051
    
    
    $
    682
    
    
    
    28.8
    %
    
    $
    2,369
    
    
    $
    (2,999
    )
    
    
    (55.9
    )%
    
    $
    5,368Short-term borrowings
    
    
    155
    
    
    
    (45
    )
    
    
    (22.5
    )
    
    
    200
    
    
    
    (2,179
    )
    
    
    (91.6
    )
    
    
    2,379Long-term debt
    
    
    3,548
    
    
    
    (1,452
    )
    
    
    (29.0
    )
    
    
    5,000
    
    
    
    3,552
    
    
    
    245.3
    
    
    
    1,448Other interest bearing liabilities
    
    
    1,160
    
    
    
    50
    
    
    
    4.5
    
    
    
    1,110
    
    
    
    52
    
    
    
    4.9
    
    
    
    1,058$
    7,914
    
    
    $
    (765
    )
    
    
    (8.8
    )%
    
    $
    8,679
    
    
    $
    (1,574
    )
    
    
    (15.4
    )%
    
    $
    10,253
 Pension Plans




---



##### 



Stockholders Equity
  2010
    
    
    2009
    
    
    2008Beginning balance
    
    $
    50,603
    
    
    $
    48,485
    
    
    $
    48,572Net income
    
    
    4,915
    
    
    
    5,106
    
    
    
    5,724Dividends
    
    
    (3,525
    )
    
    
    (3,386
    )
    
    
    (3,241
    )Stock-based compensation
    
    
    58
    
    
    
    40
    
    
    
    40Repurchase of stock, net of re-issuance
    
    
    (1,415
    )
    
    
    (84
    )
    
    
    (1,440
    )Net change in unrealized security gains
    
    
    (377
    )
    
    
    69
    
    
    
    563Defined benefit retirement plan adjustments net of tax
    
    
    (283
    )
    
    
    373
    
    
    
    (1,253
    )Effect of implementation of ASC Topic 715
    
    
    
    
    
    
    
    
    
    
    (480
    )Net change
    
    
    (627
    )
    
    
    2,118
    
    
    
    (87
    )Ending balance
    
    $
    49,976
    
    
    $
    50,603
    
    
    $
    48,485




---



##### 



Asset / Liability Management Objectives
  
    
    Liquidity Risk
    
    Capital Risk
    
    Market / Interest Rate Risk
    
    Investment Portfolio Risk
    
    Economic Risk
 Liquidity Risk




---



##### 



Payments Due by PeriodOne to
    
    
    Three to
    
    
    More thanNote
    
    
    
    
    
    
    One Year
    
    
    Three
    
    
    Five
    
    
    FiveReference
    
    
    Total
    
    
    or Less
    
    
    Years
    
    
    Years
    
    
    YearsCertificates of deposits
    
    
    11
    
    
    $
    187,604
    
    
    $
    87,523
    
    
    $
    47,172
    
    
    $
    52,909
    
    
    $
    Federal Funds borrowed and
security repurchase agreements
    
    
    12
    
    
    
    3,314
    
    
    
    3,314
    
    
    
    
    
    
    
    
    
    
    
    Operating lease obligations
    
    
    13
    
    
    
    241
    
    
    
    97
    
    
    
    78
    
    
    
    44
    
    
    
    22Other long-term liabilities
3rd party data processor contract
    
    
    22
    
    
    
    3,960
    
    
    
    528
    
    
    
    1,056
    
    
    
    1,056
    
    
    
    1,320Supplemental retirement and
deferred compensation
    
    
    19
    
    
    
    3,861
    
    
    
    445
    
    
    
    789
    
    
    
    589
    
    
    
    2,038$
    198,980
    
    
    $
    91,907
    
    
    $
    49,095
    
    
    $
    54,598
    
    
    $
    3,380




---



##### 



Capital Risk
  Market / Interest Rate Risk




---



##### 



Change in Net
    
    
    Change in NetChange in
    
    Interest Income
    
    
    Interest Income
    
    
    Total Change inInterest Rates
    
    Due to Interest
    
    
    Due to Imbedded
    
    
    Net Interest(Basis Points)
    
    Rate Risk (Static)
    
    
    Options
    
    
    Income400
    
    $
    (375
    )
    
    $
    527
    
    
    $
    152300
    
    
    (281
    )
    
    
    359
    
    
    
    78200
    
    
    (187
    )
    
    
    191
    
    
    
    4100
    
    
    (93
    )
    
    
    52
    
    
    
    (41
    )0
    
    
    
    
    
    
    
    
    
    
    -25
    
    
    23
    
    
    
    (36
    )
    
    
    (13
    )




---



##### 



Table 5
MATURITY DISTRIBUTION
AS OF DECEMBER 31, 2010   Remaining Maturity / Earliest Possible Repricing
 Over Three
    
    
    Over Six
    
    
    Over OneThree
    
    
    Months But
    
    
    Months But
    
    
    Year But
    
    
    OverMonths
    
    
    Within Six
    
    
    Within One
    
    
    Within Five
    
    
    Fiveor Less
    
    
    Months
    
    
    Year
    
    
    Years
    
    
    Years
    
    
    TotalInterest Earning AssetsInterest bearing deposits
    
    $
    218
    
    
    $
    
    
    
    $
    498
    
    
    $
    847
    
    
    $
    
    
    
    $
    1,563Federal funds sold
    
    
    12,300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,300Investment securities:Debt securities  taxable
    
    
    3,009
    
    
    
    1,503
    
    
    
    4,172
    
    
    
    32,932
    
    
    
    3,997
    
    
    
    45,613Debt securities  tax-exempt
    
    
    
    
    
    
    2,277
    
    
    
    10,961
    
    
    
    18,225
    
    
    
    541
    
    
    
    32,004Mortgage-backed securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,345
    
    
    
    
    
    
    
    1,345Stocks
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    961
    
    
    
    961Loans:Commercial, financial, and agricultural
    
    
    18,515
    
    
    
    21
    
    
    
    464
    
    
    
    8,930
    
    
    
    4,911
    
    
    
    32,841Real estate  construction
    
    
    3,262
    
    
    
    228
    
    
    
    1,476
    
    
    
    2,301
    
    
    
    3,761
    
    
    
    11,028Other loans
    
    
    45,891
    
    
    
    9,916
    
    
    
    27,302
    
    
    
    41,583
    
    
    
    129,541
    
    
    
    254,233Total Interest Earning Assets
    
    
    83,195
    
    
    
    13,945
    
    
    
    44,873
    
    
    
    106,163
    
    
    
    143,712
    
    
    
    391,888Interest Bearing LiabilitiesDemand deposits
    
    
    33,094
    
    
    
    814
    
    
    
    3,255
    
    
    
    11,393
    
    
    
    32,822
    
    
    
    81,378Savings deposits
    
    
    2,569
    
    
    
    3,041
    
    
    
    3,239
    
    
    
    6,596
    
    
    
    31,667
    
    
    
    47,112Certificates of deposit over $100,000
    
    
    4,587
    
    
    
    3,737
    
    
    
    6,362
    
    
    
    19,413
    
    
    
    
    
    
    
    34,099Time deposits
    
    
    24,403
    
    
    
    20,274
    
    
    
    28,160
    
    
    
    80,668
    
    
    
    
    
    
    
    153,505Securities sold under agreements to repurchase
    
    
    3,314
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,314Other interest bearing liabilities
    
    
    1,200
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,200Total Interest Bearing Liabilities
    
    
    69,167
    
    
    
    27,866
    
    
    
    41,016
    
    
    
    118,070
    
    
    
    64,489
    
    
    
    320,608Gap
    
    $
    14,028
    
    
    $
    (13,921
    )
    
    $
    3,857
    
    
    $
    (11,907
    )
    
    $
    79,223
    
    
    $
    71,280Cumulative Gap
    
    $
    14,028
    
    
    $
    107
    
    
    $
    3,964
    
    
    $
    (7,943
    )
    
    $
    71,280Cumulative sensitivity ratio
    
    
    1.20
    
    
    
    1.00
    
    
    
    1.03
    
    
    
    0.97
    
    
    
    1.22Commercial, financial and agricultural
loans maturing after one year with:Fixed interest rates
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    8,741
    
    
    $
    4,910
    
    
    $
    13,651Variable interest rates
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    177
    
    
    
    753
    
    
    
    930Total
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    8,918
    
    
    $
    5,663
    
    
    $
    14,581




---



##### 



Investment Portfolio Risk
  Economic Risk
  Off-Balance Sheet Arrangements




---



##### 



Effects of Inflation




---



##### 



Report on Managements Assessment of Internal Control over Financial Reporting
  Internal Control  Integrated
Framework




---



##### 



Report of Independent Registered Public Accounting Firm on Effectiveness of Internal Control over
Financial Reporting
  
 Internal Control-Integrated Framework
    Internal
Control-Integrated Framework




---



##### 



Report of Independent Registered Public Accounting Firm on Consolidated Financial Statements
  
    Internal Control-Integrated Framework




---



##### 



Juniata Valley Financial Corp. and Subsidiary
 December 31,
    
    
    December 31,2010
    
    
    2009ASSETSCash and due from banks
    
    $
    12,758
    
    
    $
    18,613Interest bearing deposits with banks
    
    
    218
    
    
    
    82Federal funds sold
    
    
    12,300
    
    
    
    1,200Cash and cash equivalents
    
    
    25,276
    
    
    
    19,895Interest bearing time deposits with banks
    
    
    1,345
    
    
    
    1,420Securities available for sale
    
    
    79,923
    
    
    
    77,356Restricted investment in Federal Home Loan Bank (FHLB) stock
    
    
    2,088
    
    
    
    2,197Investment in unconsolidated subsidiary
    
    
    3,550
    
    
    
    3,338Total loans, net of unearned interest
    
    
    298,102
    
    
    
    311,630Less: Allowance for loan losses
    
    
    (2,824
    )
    
    
    (2,719
    )Total loans, net of allowance for loan losses
    
    
    295,278
    
    
    
    308,911Premises and equipment, net
    
    
    7,067
    
    
    
    6,878Other real estate owned
    
    
    412
    
    
    
    476Bank owned life insurance and annuities
    
    
    13,568
    
    
    
    13,066Core deposit intangible
    
    
    254
    
    
    
    299Goodwill
    
    
    2,046
    
    
    
    2,046Accrued interest receivable and other assets
    
    
    4,946
    
    
    
    6,227Total assets
    
    $
    435,753
    
    
    $
    442,109LIABILITIES AND STOCKHOLDERS EQUITYLiabilities:Deposits:Non-interest bearing
    
    $
    60,696
    
    
    $
    55,030Interest bearing
    
    
    316,094
    
    
    
    322,367Total deposits
    
    
    376,790
    
    
    
    377,397Securities sold under agreements to repurchase
    
    
    3,314
    
    
    
    3,207Long-term debt
    
    
    
    
    
    
    5,000Other interest bearing liabilities
    
    
    1,200
    
    
    
    1,146Accrued interest payable and other liabilities
    
    
    4,473
    
    
    
    4,756Total liabilities
    
    
    385,777
    
    
    
    391,506Stockholders Equity:Preferred stock, no par value:Authorized - 500,000 shares, none issued
    
    
    
    
    
    
    Common stock, par value $1.00 per share:Authorized - 20,000,000 sharesIssued - 4,745,826 sharesOutstanding -4,257,765 shares at December 31, 2010;4,337,587 shares at December 31, 2009
    
    
    4,746
    
    
    
    4,746Surplus
    
    
    18,354
    
    
    
    18,315Retained earnings
    
    
    37,868
    
    
    
    36,478Accumulated other comprehensive loss
    
    
    (1,465
    )
    
    
    (805
    )Cost of common stock in Treasury:488,061 shares at December 31, 2010;408,239 shares at December 31, 2009
    
    
    (9,527
    )
    
    
    (8,131
    )Total stockholders equity
    
    
    49,976
    
    
    
    50,603Total liabilities and stockholders equity
    
    $
    435,753
    
    
    $
    442,109




---



##### 



Juniata Valley Financial Corp. and Subsidiary
 Years Ended December 31,2010
    
    
    2009
    
    
    2008Interest income:Loans, including fees
    
    $
    19,537
    
    
    $
    20,787
    
    
    $
    22,100Taxable securities
    
    
    973
    
    
    
    1,163
    
    
    
    1,666Tax-exempt securities
    
    
    1,016
    
    
    
    1,152
    
    
    
    1,082Other interest income
    
    
    48
    
    
    
    166
    
    
    
    382Total interest income
    
    
    21,574
    
    
    
    23,268
    
    
    
    25,230Interest expense:Deposits
    
    
    5,387
    
    
    
    7,116
    
    
    
    8,895Securities sold under agreements to repurchase
    
    
    3
    
    
    
    2
    
    
    
    69Short-term borrowings
    
    
    1
    
    
    
    1
    
    
    
    21Long-term debt
    
    
    99
    
    
    
    140
    
    
    
    41Other interest bearing liabilities
    
    
    12
    
    
    
    20
    
    
    
    31Total interest expense
    
    
    5,502
    
    
    
    7,279
    
    
    
    9,057Net interest income
    
    
    16,072
    
    
    
    15,989
    
    
    
    16,173Provision for loan losses
    
    
    741
    
    
    
    627
    
    
    
    421Net interest income after provision for loan losses
    
    
    15,331
    
    
    
    15,362
    
    
    
    15,752Noninterest income:Trust fees
    
    
    378
    
    
    
    361
    
    
    
    389Customer service fees
    
    
    1,428
    
    
    
    1,673
    
    
    
    1,660Earnings on bank owned life insurance and annuities
    
    
    510
    
    
    
    444
    
    
    
    486Commissions from sales of non-deposit products
    
    
    358
    
    
    
    446
    
    
    
    704Income from unconsolidated subsidiary
    
    
    250
    
    
    
    217
    
    
    
    207Securities impairment charge
    
    
    (40
    )
    
    
    (226
    )
    
    
    (554
    )Gain on sales or calls of securities
    
    
    31
    
    
    
    17
    
    
    
    33Gain (Loss) on sales of other assets
    
    
    79
    
    
    
    (19
    )
    
    
    58Gain on life insurance proceeds
    
    
    
    
    
    
    
    
    
    
    179Prior period income from insurance sales
    
    
    
    
    
    
    323
    
    
    
    Other noninterest income
    
    
    940
    
    
    
    935
    
    
    
    875Total noninterest income
    
    
    3,934
    
    
    
    4,171
    
    
    
    4,037Noninterest expense:Employee compensation expense
    
    
    5,052
    
    
    
    4,958
    
    
    
    5,078Employee benefits
    
    
    1,565
    
    
    
    1,667
    
    
    
    1,373Occupancy
    
    
    939
    
    
    
    940
    
    
    
    928Equipment
    
    
    565
    
    
    
    612
    
    
    
    710Data processing expense
    
    
    1,397
    
    
    
    1,325
    
    
    
    1,375Director compensation
    
    
    335
    
    
    
    416
    
    
    
    417Professional fees
    
    
    515
    
    
    
    392
    
    
    
    379Taxes, other than income
    
    
    469
    
    
    
    476
    
    
    
    500FDIC Insurance premiums
    
    
    534
    
    
    
    634
    
    
    
    59Intangible amortization
    
    
    45
    
    
    
    45
    
    
    
    45Other noninterest expense
    
    
    1,304
    
    
    
    1,154
    
    
    
    1,144Total noninterest expense
    
    
    12,720
    
    
    
    12,619
    
    
    
    12,008Income before income taxes
    
    
    6,545
    
    
    
    6,914
    
    
    
    7,781Provision for income taxes
    
    
    1,630
    
    
    
    1,808
    
    
    
    2,057Net income
    
    $
    4,915
    
    
    $
    5,106
    
    
    $
    5,724Earnings per shareBasic
    
    $
    1.14
    
    
    $
    1.18
    
    
    $
    1.31Diluted
    
    $
    1.14
    
    
    $
    1.18
    
    
    $
    1.31Cash dividends declared per share
    
    $
    0.82
    
    
    $
    0.78
    
    
    $
    0.74Weighted average basic shares outstanding
    
    
    4,297,443
    
    
    
    4,341,097
    
    
    
    4,376,077Weighted average diluted shares outstanding
    
    
    4,300,966
    
    
    
    4,345,236
    
    
    
    4,385,612




---



##### 



Juniata Valley Financial Corp. and Subsidiary
 Years Ended December 31, 2010, 2009 and 2008Number
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Accumulatedof
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other
    
    
    
    
    
    
    TotalShares
    
    
    Common
    
    
    
    
    
    
    Retained
    
    
    Comprehensive
    
    
    Treasury
    
    
    StockholdersOutstanding
    
    
    Stock
    
    
    Surplus
    
    
    Earnings
    
    
    Loss
    
    
    Stock
    
    
    EquityBalance at December 31, 2007
    
    
    4,409,445
    
    
    $
    4,746
    
    
    $
    18,297
    
    
    $
    32,755
    
    
    $
    (557
    )
    
    $
    (6,669
    )
    
    $
    48,572Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,724
    
    
    
    
    
    
    
    
    
    
    
    5,724Change in unrealized gains on securities
available for sale, net of reclassification adjustment and tax effects
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    563
    
    
    
    
    
    
    
    563Defined benefit retirement plan
adjustments, net of tax effects
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,253
    )
    
    
    
    
    
    
    (1,253
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,034Implementation of ASC Topic 715
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (480
    )
    
    
    
    
    
    
    
    
    
    
    (480
    )Cash dividends at $0.74 per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,241
    )
    
    
    
    
    
    
    
    
    
    
    (3,241
    )Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    40
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    40Purchase of treasury stock, at cost
    
    
    (72,955
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,518
    )
    
    
    (1,518
    )Treasury stock issued for stock option
and stock purchase plans
    
    
    4,565
    
    
    
    
    
    
    
    (13
    )
    
    
    
    
    
    
    
    
    
    
    91
    
    
    
    78Balance at December 31, 2008
    
    
    4,341,055
    
    
    
    4,746
    
    
    
    18,324
    
    
    
    34,758
    
    
    
    (1,247
    )
    
    
    (8,096
    )
    
    
    48,485Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,106
    
    
    
    
    
    
    
    
    
    
    
    5,106Change in unrealized gains on securities
available for sale, net of reclassification adjustment and tax effects
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    69
    
    
    
    
    
    
    
    69Defined benefit retirement plan
adjustments, net of tax effects
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    373
    
    
    
    
    
    
    
    373Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,548Cash dividends at $0.78 per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,386
    )
    
    
    
    
    
    
    
    
    
    
    (3,386
    )Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    40
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    40Purchase of treasury stock, at cost
    
    
    (12,600
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (217
    )
    
    
    (217
    )Treasury stock issued for stock option
and stock purchase plans
    
    
    9,132
    
    
    
    
    
    
    
    (49
    )
    
    
    
    
    
    
    
    
    
    
    182
    
    
    
    133Balance at December 31, 2009
    
    
    4,337,587
    
    
    
    4,746
    
    
    
    18,315
    
    
    
    36,478
    
    
    
    (805
    )
    
    
    (8,131
    )
    
    
    50,603Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,915
    
    
    
    
    
    
    
    
    
    
    
    4,915Change in unrealized gains on securities
available for sale, net of reclassification adjustment and tax effects
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (377
    )
    
    
    
    
    
    
    (377
    )Defined benefit retirement plan
adjustments, net of tax effects
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (283
    )
    
    
    
    
    
    
    (283
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,255Cash dividends at $0.82 per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,525
    )
    
    
    
    
    
    
    
    
    
    
    (3,525
    )Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    58
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    58Purchase of treasury stock, at cost
    
    
    (83,900
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,476
    )
    
    
    (1,476
    )Treasury stock issued for stock option
and stock purchase plans
    
    
    4,078
    
    
    
    
    
    
    
    (19
    )
    
    
    
    
    
    
    
    
    
    
    80
    
    
    
    61Balance at December 31, 2010
    
    
    4,257,765
    
    
    $
    4,746
    
    
    $
    18,354
    
    
    $
    37,868
    
    
    $
    (1,465
    )
    
    $
    (9,527
    )
    
    $
    49,976




---



##### 



Juniata Valley Financial Corp. and Subsidiary
 Years Ended December 31,2010
    
    
    2009
    
    
    2008Operating activities:Net income
    
    $
    4,915
    
    
    $
    5,106
    
    
    $
    5,724Adjustments to reconcile net income to net cash provided by operating activities:Provision for loan losses
    
    
    741
    
    
    
    627
    
    
    
    421Depreciation
    
    
    565
    
    
    
    587
    
    
    
    691Net amortization of securities premiums
    
    
    293
    
    
    
    220
    
    
    
    126Net amortization of loan origination costs
    
    
    28
    
    
    
    45
    
    
    
    25Amortization of core deposit intangible
    
    
    45
    
    
    
    45
    
    
    
    45Securities impairment charge
    
    
    40
    
    
    
    226
    
    
    
    554Net realized gains on sales or calls of securities
    
    
    (31
    )
    
    
    (17
    )
    
    
    (33
    )Net losses (gains) on sales of other assets
    
    
    (79
    )
    
    
    19
    
    
    
    (58
    )Earnings on bank owned life insurance and annuities
    
    
    (510
    )
    
    
    (444
    )
    
    
    (486
    )Bank owned life insurance proceeds in excess of cash surrender value
    
    
    
    
    
    
    
    
    
    
    (179
    )Deferred income tax expense
    
    
    163
    
    
    
    223
    
    
    
    609Equity in earnings of unconsolidated subsidiary, net of dividends of $40,
$46 and $0
    
    
    (210
    )
    
    
    (171
    )
    
    
    (207
    )Stock-based compensation expense
    
    
    58
    
    
    
    40
    
    
    
    40Decrease (increase) in accrued interest receivable and other assets
    
    
    1,064
    
    
    
    (927
    )
    
    
    (962
    )Decrease in accrued interest payable and other liabilities
    
    
    (208
    )
    
    
    (869
    )
    
    
    (2,066
    )Net cash provided by operating activities
    
    
    6,874
    
    
    
    4,710
    
    
    
    4,244Investing activities:Purchases of:Securities available for sale
    
    
    (53,198
    )
    
    
    (56,245
    )
    
    
    (36,063
    )FHLB stock
    
    
    
    
    
    
    
    
    
    
    (1,419
    )Premises and equipment
    
    
    (754
    )
    
    
    (128
    )
    
    
    (838
    )Bank owned life insurance and annuities
    
    
    (70
    )
    
    
    (120
    )
    
    
    (94
    )Proceeds from:Sales of securities available for sale
    
    
    
    
    
    
    5,004
    
    
    
    9Maturities of and principal repayments on:Securities available for sale
    
    
    49,754
    
    
    
    37,908
    
    
    
    38,987Redemption of FHLB stock
    
    
    109
    
    
    
    
    
    
    
    317Bank owned life insurance and annuities
    
    
    57
    
    
    
    68
    
    
    
    511Sale of other real estate owned
    
    
    911
    
    
    
    603
    
    
    
    311Sale of property owned for investment and other assets
    
    
    
    
    
    
    160
    
    
    
    322Net decrease in interest bearing time deposits
    
    
    75
    
    
    
    3,905
    
    
    
    200Net decrease (increase) in loans receivable
    
    
    12,063
    
    
    
    2,049
    
    
    
    (17,595
    )Net cash provided by (used in) investing activities
    
    
    8,947
    
    
    
    (6,796
    )
    
    
    (15,352
    )Financing activities:Net (decrease) increase in deposits
    
    
    (607
    )
    
    
    20,366
    
    
    
    (2,426
    )Net increase (decrease) in short-term borrowings and securitiessold under agreements to repurchase
    
    
    107
    
    
    
    (7,372
    )
    
    
    5,148Issuance of long-term debt
    
    
    
    
    
    
    
    
    
    
    5,000Repayment of long-term debt
    
    
    (5,000
    )
    
    
    
    
    
    
    Cash dividends
    
    
    (3,525
    )
    
    
    (3,386
    )
    
    
    (3,241
    )Purchase of treasury stock
    
    
    (1,476
    )
    
    
    (217
    )
    
    
    (1,518
    )Treasury stock issued for employee stock plans
    
    
    61
    
    
    
    133
    
    
    
    78Net cash (used in) provided by financing activities
    
    
    (10,440
    )
    
    
    9,524
    
    
    
    3,041Net increase (decrease) in cash and cash equivalents
    
    
    5,381
    
    
    
    7,438
    
    
    
    (8,067
    )Cash and cash equivalents at beginning of year
    
    
    19,895
    
    
    
    12,457
    
    
    
    20,524Cash and cash equivalents at end of year
    
    $
    25,276
    
    
    $
    19,895
    
    
    $
    12,457Supplemental information:Interest paid
    
    $
    5,684
    
    
    $
    7,399
    
    
    $
    9,255Income taxes paid
    
    
    1,305
    
    
    
    1,340
    
    
    
    2,100Supplemental schedule of noncash investing and financing activities:Transfer of loans to other real estate owned
    
    $
    758
    
    
    $
    814
    
    
    $
    305Transfer of loans to other assets owned
    
    
    1
    
    
    
    74
    
    
    
    Transfer of fixed asset to other assets
    
    
    
    
    
    
    
    
    
    
    45




---



##### 



JUNIATA VALLEY FINANCIAL CORP. AND SUBSIDIARY
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
 Nature Of Operations
  1. Summary of Significant Accounting Policies
  Principles of consolidation
  Use of estimates
  Significant group concentrations of credit risk




---



##### 



Cash and cash equivalents
  Interest bearing time deposits with banks
  Securities
    Restricted Investment in Federal Home Loan Bank Stock




---



##### 



Loans
     Loan origination fees and costs
  Allowance for loan losses




---



##### 



(1)
    
    principal or interest has been in default for 120 days or more and for which no
payment has been received during the previous four months,
 (2)
    
    all collateral securing the loan has been liquidated and a deficiency balance
remains,
 (3)
    
    a bankruptcy notice is received for an unsecured loan, or
 (4)
    
    the loan is deemed to be uncollectible for any other reason.




---



##### 



1.
    
    National, regional and local economic and business conditions as well as the
condition of various market segments, including the underlying collateral for
collateral dependent loans.
 2.
    
    Nature and volume of the portfolio and terms of loans.
 3.
    
    Experience, ability and depth of lending and credit management and staff.
 4.
    
    Volume and severity of past due, classified and nonaccrual loans as well as
other loan modifications.
 5.
    
    Existence and effect of any concentrations of credit and changes in the level
of such concentrations.
 6.
    
    Effect of external factors, including competition.
  Commercial, Financial and Agricultural Lending




---



##### 



Commercial Real Estate Lending
   Real Estate Construction Lending
    Residential Mortgage Lending




---



##### 



Home Equity Installment and Line of Credit Lending
     Obligations of States and Political Subdivisions
 Personal Lending




---



##### 



Other real estate owned
  Business combinations
  Goodwill and other intangible assets
   Premises and equipment and depreciation
  Trust assets and revenues
  Bank owned life insurance and annuities
   Income taxes




---



##### 



Advertising
  Off-balance sheet financial instruments
  Transfer of financial assets
  Stock-based compensation
  2009
    
    
    2008Expected life of options
    
    7 years
    
    
    7 yearsRisk-free interest rate
    
    
    2.93
    %
    
    
    3.08
    %Expected volatility
    
    
    21.77
    %
    
    
    19.47
    %Expected dividend yield
    
    
    3.68
    %
    
    
    3.20
    %
  Segment reporting
   Subsequent events




---



##### 



2. Recent Accounting Standard Updates (ASU)
 ASU 2011-01
   ASU 2010-29
       ASU 2010-28




---



##### 



ASU 2010-20
     ASU 2010-18




---



##### 



ASU 2010-13
   ASU 2010-09
     3. Restrictions on Cash and Due From Banks




---



##### 



4. Securities
  December 31, 2010Gross
    
    
    GrossSecurities Available for Sale
    
    Amortized
    
    
    Fair
    
    
    Unrealized
    
    
    UnrealizedType and maturity
    
    Cost
    
    
    Value
    
    
    Gains
    
    
    LossesU.S. Treasury securities and obligations of U.S.
Government agencies and corporationsAfter one year but within five years
    
    $
    34,607
    
    
    $
    34,783
    
    
    $
    348
    
    
    $
    (172
    )After five years but within ten years
    
    
    3,000
    
    
    
    2,913
    
    
    
    
    
    
    
    (87
    )37,607
    
    
    
    37,696
    
    
    
    348
    
    
    
    (259
    )Obligations of state and political subdivisionsWithin one year
    
    
    12,219
    
    
    
    12,390
    
    
    
    175
    
    
    
    (4
    )After one year but within five years
    
    
    24,493
    
    
    
    24,877
    
    
    
    488
    
    
    
    (104
    )After five years but within ten years
    
    
    1,826
    
    
    
    1,626
    
    
    
    
    
    
    
    (200
    )38,538
    
    
    
    38,893
    
    
    
    663
    
    
    
    (308
    )Corporate notesAfter one year but within five years
    
    
    1,000
    
    
    
    1,028
    
    
    
    28
    
    
    
    1,000
    
    
    
    1,028
    
    
    
    28
    
    
    
    Mortgage-backed securities
    
    
    1,246
    
    
    
    1,345
    
    
    
    99Equity securities
    
    
    935
    
    
    
    961
    
    
    
    106
    
    
    
    (80
    )Total
    
    $
    79,326
    
    
    $
    79,923
    
    
    $
    1,244
    
    
    $
    (647
    )
 December 31, 2009Gross
    
    
    GrossSecurities Available for Sale
    
    Amortized
    
    
    Fair
    
    
    Unrealized
    
    
    UnrealizedType and maturity
    
    Cost
    
    
    Value
    
    
    Gains
    
    
    LossesU.S. Treasury securities and obligations of U.S.
Government agencies and corporationsAfter one year but within five years
    
    $
    32,503
    
    
    $
    32,620
    
    
    $
    194
    
    
    $
    (77
    )After five years but within ten years
    
    
    940
    
    
    
    933
    
    
    
    
    
    
    
    (7
    )33,443
    
    
    
    33,553
    
    
    
    194
    
    
    
    (84
    )Obligations of state and political subdivisionsWithin one year
    
    
    6,775
    
    
    
    6,863
    
    
    
    88
    
    
    
    After one year but within five years
    
    
    32,022
    
    
    
    32,972
    
    
    
    958
    
    
    
    (8
    )After five years but within ten years
    
    
    544
    
    
    
    562
    
    
    
    18
    
    
    
    39,341
    
    
    
    40,397
    
    
    
    1,064
    
    
    
    (8
    )Corporate notesAfter one year but within five years
    
    
    1,000
    
    
    
    1,026
    
    
    
    26
    
    
    
    1,000
    
    
    
    1,026
    
    
    
    26
    
    
    
    Mortgage-backed securities
    
    
    1,425
    
    
    
    1,515
    
    
    
    90
    
    
    
    Equity securities
    
    
    975
    
    
    
    865
    
    
    
    58
    
    
    
    (168
    )Total
    
    $
    76,184
    
    
    $
    77,356
    
    
    $
    1,432
    
    
    $
    (260
    )




---



##### 



Years Ended December 31,2010
    
    
    2009
    
    
    2008Gross proceeds from sales of securities
    
    $
    
    
    
    $
    5,004
    
    
    $
    9Securities available for sale:Gross realized gains
    
    $
    31
    
    
    $
    22
    
    
    $
    Gross realized losses
    
    
    
    
    
    
    (5
    )
    
    
    (8
    )Gross gains from business combinations
    
    
    
    
    
    
    
    
    
    
    41
  Less Than 12 Months
    
    
    12 Months or More
    
    
    TotalFair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedValue
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesU.S. Treasury securities and
obligations of U.S. Government
agencies and corporations
    
    $
    17,859
    
    
    $
    (259
    )
    
    $
    
    
    
    $
    
    
    
    $
    17,859
    
    
    $
    (259
    )Obligations of state and political
subdivisions
    
    
    9,719
    
    
    
    (304
    )
    
    
    881
    
    
    
    (4
    )
    
    
    10,600
    
    
    
    (308
    )Debt securities
    
    
    27,578
    
    
    
    (563
    )
    
    
    881
    
    
    
    (4
    )
    
    
    28,459
    
    
    
    (567
    )Equity securities
    
    
    389
    
    
    
    (5
    )
    
    
    270
    
    
    
    (75
    )
    
    
    659
    
    
    
    (80
    )Total temporarily impaired securities
    
    $
    27,967
    
    
    $
    (568
    )
    
    $
    1,151
    
    
    $
    (79
    )
    
    $
    29,118
    
    
    $
    (647
    )




---



##### 



Less Than 12 Months
    
    
    12 Months or More
    
    
    TotalFair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedValue
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesU.S. Treasury securities and
obligations of U.S. Government
agencies and corporations
    
    $
    10,897
    
    
    $
    (84
    )
    
    $
    
    
    
    $
    
    
    
    $
    10,897
    
    
    $
    (84
    )Obligations of state and political
subdivisions
    
    
    2,532
    
    
    
    (8
    )
    
    
    
    
    
    
    
    
    
    
    2,532
    
    
    
    (8
    )Debt securities
    
    
    13,429
    
    
    
    (92
    )
    
    
    
    
    
    
    
    
    
    
    13,429
    
    
    
    (92
    )Equity securities
    
    
    140
    
    
    
    (23
    )
    
    
    496
    
    
    
    (145
    )
    
    
    636
    
    
    
    (168
    )Total temporarily impaired securities
    
    $
    13,569
    
    
    $
    (115
    )
    
    $
    496
    
    
    $
    (145
    )
    
    $
    14,065
    
    
    $
    (260
    )




---



##### 



5. Loans and Related Allowance for Loan Losses
  December 31,2010
    
    
    2009Commercial, financial and agricultural
    
    $
    32,841
    
    
    $
    33,783Real estate  commercial
    
    
    44,185
    
    
    
    39,299Real estate  construction
    
    
    11,028
    
    
    
    24,578Real estate  mortgage
    
    
    142,608
    
    
    
    135,854Home equity
    
    
    46,352
    
    
    
    52,957Obligations of states and political subdivisions
    
    
    10,960
    
    
    
    13,553Personal
    
    
    10,155
    
    
    
    11,670Unearned interest
    
    
    (27
    )
    
    
    (64
    )Total
    
    $
    298,102
    
    
    $
    311,630
  SpecialPass
    
    
    Mention
    
    
    Substandard
    
    
    Doubtful
    
    
    TotalCommercial financial and agricultural
    
    $
    24,594
    
    
    $
    6,387
    
    
    $
    1,554
    
    
    $
    306
    
    
    $
    32,841Real estate  commercial
    
    
    33,437
    
    
    
    6,059
    
    
    
    4,089
    
    
    
    600
    
    
    
    44,185Real estate  construction
    
    
    11,028
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,028Real estate  mortgage
    
    
    127,944
    
    
    
    8,069
    
    
    
    5,180
    
    
    
    1,415
    
    
    
    142,608Home equity
    
    
    45,228
    
    
    
    431
    
    
    
    666
    
    
    
    
    
    
    
    46,325Obligations of states and political subdivisions
    
    
    10,960
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,960Personal
    
    
    10,034
    
    
    
    117
    
    
    
    4
    
    
    
    
    
    
    
    10,155Total
    
    $
    263,225
    
    
    $
    21,063
    
    
    $
    11,493
    
    
    $
    2,321
    
    
    $
    298,102
  December 31,2010
    
    
    2009Nonaccrual loans
    
    $
    5,964
    
    
    $
    2,629Accruing loans past due 90 days or more
    
    
    1,007
    
    
    
    1,369Restructured loans
    
    
    
    
    
    
    Total non-performing loans
    
    $
    6,971
    
    
    $
    3,998




---



##### 



Years Ended December 31,2010
    
    
    2009
    
    
    2008Balance of allowance  beginning of period
    
    $
    2,719
    
    
    $
    2,610
    
    
    $
    2,322Loans charged off:Commercial, financial and agricultural
    
    
    134
    
    
    
    47
    
    
    
    43Real estate  commercial
    
    
    
    
    
    
    32
    
    
    
    36Real estate  mortgage
    
    
    482
    
    
    
    343
    
    
    
    15Personal
    
    
    38
    
    
    
    107
    
    
    
    62Total charge-offs
    
    
    654
    
    
    
    529
    
    
    
    156Recoveries of loans previously charged off:Commercial, financial and agricultural
    
    
    
    
    
    
    
    
    
    
    5Real estate  mortgage
    
    
    
    
    
    
    
    
    
    
    5Personal
    
    
    18
    
    
    
    11
    
    
    
    13Total recoveries
    
    
    18
    
    
    
    11
    
    
    
    23Net charge-offs
    
    
    636
    
    
    
    518
    
    
    
    133Provision for loan losses
    
    
    741
    
    
    
    627
    
    
    
    421Balance of allowance  end of period
    
    $
    2,824
    
    
    $
    2,719
    
    
    $
    2,610Ratio of net charge-offs during period to
average loans outstanding
    
    
    0.21
    %
    
    
    0.17
    %
    
    
    0.04
    %
  December 31,2010
    
    
    2009Impaired loans:Recorded investment at period end
    
    $
    7,743
    
    
    $
    8,245Impaired loan balance for which:There is a related allowance
    
    
    2,137
    
    
    
    1,445There is no related allowance
    
    
    5,606
    
    
    
    6,800Related allowance on impaired loans
    
    
    570
    
    
    
    278
 Years Ended December 31,2010
    
    
    2009
    
    
    2008Average recorded investment in impaired loans
    
    $
    7,994
    
    
    $
    5,865
    
    
    $
    1,640Interest income recognized (on a cash basis)
    
    
    276
    
    
    
    611
    
    
    
    82




---



##### 



Unpaid
    
    
    
    
    
    
    Average
    
    
    InterestRecorded
    
    
    Principal
    
    
    Related
    
    
    Recorded
    
    
    IncomeInvestment
    
    
    Balance
    
    
    Allowance
    
    
    Investment
    
    
    RecognizedWith no related allowance recorded:Real estate  commercial
    
    $
    5,606
    
    
    $
    5,606
    
    
    $
    
    
    
    $
    6,203
    
    
    $
    260With an allowance recorded:Real estate  commercial
    
    
    2,137
    
    
    
    2,137
    
    
    
    570
    
    
    
    1,791
    
    
    
    16Total:Real estate  commercial
    
    $
    7,743
    
    
    $
    7,743
    
    
    $
    570
    
    
    $
    7,994
    
    
    $
    276
  Nonaccrual loans
    
    December 31, 2010Commercial financial and agricultural
    
    $
    784Real estate  commercial
    
    
    240Real estate  construction
    
    
    850Real estate  mortgage
    
    
    3,564Home equity
    
    
    524Obligations of states and political subdivisions
    
    
    Personal
    
    
    2Total
    
    $
    5,964
  Loans PastDue greater30-59 Days
    
    
    60-89 Days
    
    
    Greater than
    
    
    Total Past
    
    
    
    
    
    
    Total
    
    
    than 90 DaysPast Due
    
    
    Past Due
    
    
    90 Days
    
    
    Due
    
    
    Current
    
    
    Loans
    
    
    And AccruingCommercial financial and agricultural
    
    $
    159
    
    
    $
    352
    
    
    $
    878
    
    
    $
    1,389
    
    
    $
    31,452
    
    
    $
    32,841
    
    
    $
    113Real estate  commercial
    
    
    1,106
    
    
    
    547
    
    
    
    404
    
    
    
    2,057
    
    
    
    42,128
    
    
    
    44,185
    
    
    
    164Real estate  construction
    
    
    
    
    
    
    270
    
    
    
    850
    
    
    
    1,120
    
    
    
    9,908
    
    
    
    11,028
    
    
    
    Real estate  mortgage
    
    
    260
    
    
    
    4,769
    
    
    
    3,431
    
    
    
    8,460
    
    
    
    134,148
    
    
    
    142,608
    
    
    
    555Home equity
    
    
    737
    
    
    
    318
    
    
    
    466
    
    
    
    1,521
    
    
    
    44,804
    
    
    
    46,325
    
    
    
    167Obligations of states and political subdivisions
    
    
    243
    
    
    
    
    
    
    
    
    
    
    
    243
    
    
    
    10,717
    
    
    
    10,960
    
    
    
    Personal
    
    
    110
    
    
    
    15
    
    
    
    10
    
    
    
    135
    
    
    
    10,020
    
    
    
    10,155
    
    
    
    8Total
    
    $
    2,615
    
    
    $
    6,271
    
    
    $
    6,039
    
    
    $
    14,925
    
    
    $
    283,177
    
    
    $
    298,102
    
    
    $
    1,007
  Obligations ofCommercial,
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    states andfinancial and
    
    
    Real estate-
    
    
    Real estate-
    
    
    Real estate-
    
    
    
    
    
    
    politicalagricultural
    
    
    commercial
    
    
    construction
    
    
    mortgage
    
    
    Home equity
    
    
    subdivisions
    
    
    Personal
    
    
    TotalAllowance for loan losses:Ending balance
    
    $
    283
    
    
    $
    875
    
    
    $
    93
    
    
    $
    1,098
    
    
    $
    391
    
    
    $
    
    
    
    $
    84
    
    
    $
    2,824Ending balance: individually evaluated for impairment
    
    $
    
    
    
    $
    570
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    570Ending balance: collectively evaluted for impairment
    
    $
    283
    
    
    $
    305
    
    
    $
    93
    
    
    $
    1,098
    
    
    $
    391
    
    
    $
    
    
    
    $
    84
    
    
    $
    2,254Loans, net of unearned interest:Ending balance
    
    $
    32,841
    
    
    $
    44,185
    
    
    $
    11,028
    
    
    $
    142,608
    
    
    $
    46,325
    
    
    $
    10,960
    
    
    $
    10,155
    
    
    $
    298,102Ending balance: individually evaluted for impairment
    
    $
    
    
    
    $
    7,743
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    7,743Ending balance: collectively evaluated for impairment
    
    $
    32,841
    
    
    $
    36,442
    
    
    $
    11,028
    
    
    $
    142,608
    
    
    $
    46,325
    
    
    $
    10,960
    
    
    $
    10,155
    
    
    $
    290,359




---



##### 



6. Pledged Loans
  7. Bank Owned Life Insurance and Annuities
  Life
    
    
    Deferred
    
    
    PayoutInsurance
    
    
    Annuities
    
    
    Annuities
    
    
    TotalBalance as of December 31, 2008
    
    $
    12,161
    
    
    $
    250
    
    
    $
    171
    
    
    $
    12,582Earnings
    
    
    424
    
    
    
    11
    
    
    
    (3
    )
    
    
    432Premiums on existing policies
    
    
    106
    
    
    
    14
    
    
    
    
    
    
    
    120Annuity payments received
    
    
    
    
    
    
    
    
    
    
    (68
    )
    
    
    (68
    )Balance as of December 31, 2009
    
    
    12,691
    
    
    
    275
    
    
    
    100
    
    
    
    13,066Earnings
    
    
    475
    
    
    
    11
    
    
    
    3
    
    
    
    489Premiums on existing policies
    
    
    56
    
    
    
    14
    
    
    
    (57
    )
    
    
    13Annuity payments received
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance as of December 31, 2010
    
    $
    13,222
    
    
    $
    300
    
    
    $
    46
    
    
    $
    13,568




---



##### 



8. Premises And Equipment
  December 31,2010
    
    
    2009Land
    
    $
    864
    
    
    $
    864Buildings and improvements
    
    
    8,416
    
    
    
    8,393Furniture, computer software
and equipment
    
    
    4,121
    
    
    
    5,11713,401
    
    
    
    14,374Less: accumulated depreciation
    
    
    (6,334
    )
    
    
    (7,496
    )$
    7,067
    
    
    $
    6,878
  9. Acquisition
   10. Investment in Unconsolidated Subsidiary




---



##### 



11. Deposits
  December 31,2010
    
    
    2009Demand, non-interest bearing
    
    $
    60,696
    
    
    $
    55,030NOW and Money Market
    
    
    81,378
    
    
    
    75,766Savings
    
    
    47,112
    
    
    
    42,536Time deposits, $100,000 or more
    
    
    34,099
    
    
    
    38,453Other time deposits
    
    
    153,505
    
    
    
    165,612$
    376,790
    
    
    $
    377,397
  Time DepositsMaturing in:
    
    $100,000 or more
    
    
    Other2011
    
    $
    14,686
    
    
    $
    72,8372012
    
    
    4,634
    
    
    
    23,7712013
    
    
    2,675
    
    
    
    16,0922014
    
    
    3,062
    
    
    
    14,1782015
    
    
    9,042
    
    
    
    26,627$
    34,099
    
    
    $
    153,505




---



##### 



12. Borrowings
  December 31, 2010
    
    
    December 31, 2009
    
    
    December 31, 2008
    
    
    For the year 2010WeightedOutstanding
    
    
    
    
    
    
    Outstanding
    
    
    
    
    
    
    Outstanding
    
    
    
    
    
    
    Average
    
    
    AverageBalance
    
    
    Rate
    
    
    Balance
    
    
    Rate
    
    
    Balance
    
    
    Rate
    
    
    Balance
    
    
    RateSecurities sold under agreements to repurchase
    
    $
    3,314
    
    
    
    0.10
    %
    
    $
    3,207
    
    
    
    0.10
    %
    
    $
    1,944
    
    
    
    0.10
    %
    
    $
    3,050
    
    
    
    0.10
    %Short-term borrowings  Federal Home Loan Bank overnight advances
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,635
    
    
    
    0.59
    %
    
    
    155
    
    
    
    0.67
    %Long-term debt  Note payable to Federal Home Loan Bank
    
    
    
    
    
    
    
    
    
    
    5,000
    
    
    
    2.75
    %
    
    
    5,000
    
    
    
    2.75
    %
    
    
    3,548
    
    
    
    2.75
    %$
    3,314
    
    
    
    0.10
    %
    
    $
    8,207
    
    
    
    1.71
    %
    
    $
    15,579
    
    
    
    1.22
    %
    
    $
    6,753
    
    
    
    1.51
    %




---



##### 



13. Operating Lease Obligations
   Years ending December 31,2011
    
    $
    972012
    
    
    582013
    
    
    202014
    
    
    222015
    
    
    222016 and beyond
    
    
    22Total minimum payments required
    
    $
    241
 14. Income Taxes
  2010
    
    
    2009
    
    
    2008Current tax expense
    
    $
    1,467
    
    
    $
    1,585
    
    
    $
    1,448Deferred tax expense
    
    
    163
    
    
    
    223
    
    
    
    609Total tax expense
    
    $
    1,630
    
    
    $
    1,808
    
    
    $
    2,057
   Years Ended December 31,2010
    
    
    2009
    
    
    2008Income before income taxes
    
    $
    6,545
    
    
    $
    6,914
    
    
    $
    7,781Effective tax rate
    
    
    34.0
    %
    
    
    34.0
    %
    
    
    34.0
    %Federal tax at statutory rate
    
    
    2,225
    
    
    
    2,351
    
    
    
    2,646Tax-exempt interest
    
    
    (473
    )
    
    
    (439
    )
    
    
    (398
    )Net earnings on BOLI
    
    
    (148
    )
    
    
    (121
    )
    
    
    (130
    )Life insurance proceeds
    
    
    
    
    
    
    
    
    
    
    (61
    )Dividend from unconsolidated
subsidiary
    
    
    (11
    )
    
    
    (13
    )
    
    
    Stock-based compensation
    
    
    19
    
    
    
    14
    
    
    
    14Other permanent differences
    
    
    18
    
    
    
    16
    
    
    
    (14
    )Total tax expense
    
    $
    1,630
    
    
    $
    1,808
    
    
    $
    2,057Effective tax rate
    
    
    24.9
    %
    
    
    26.1
    %
    
    
    26.4
    %




---



##### 



December 31,2010
    
    
    2009Deferred Tax AssetsAllowance for loan losses
    
    $
    823
    
    
    $
    787Deferred directors compensation
    
    
    616
    
    
    
    654Employee and director benefits
    
    
    634
    
    
    
    668Unrealized loss from securities impairment
    
    
    221
    
    
    
    208Other
    
    
    144
    
    
    
    102Total deferred tax assets
    
    
    2,438
    
    
    
    2,419Deferred Tax LiabilitiesDepreciation
    
    
    (191
    )
    
    
    (207
    )Equity income from unconsolidated subsidiary
    
    
    (249
    )
    
    
    (178
    )Qualified pension asset
    
    
    (73
    )
    
    
    (122
    )Loan origination costs
    
    
    (158
    )
    
    
    (147
    )Prepaid expense
    
    
    (35
    )
    
    
    (114
    )Unrealized gains on securities available for sale
    
    
    (203
    )
    
    
    (398
    )Annuity earnings
    
    
    (36
    )
    
    
    (39
    )Goodwill
    
    
    (201
    )
    
    
    (154
    )Total deferred tax liabilities
    
    
    (1,146
    )
    
    
    (1,359
    )Net deferred tax asset
included in other assets
    
    $
    1,292
    
    
    $
    1,060




---



##### 



15. Stockholders Equity and Regulatory Matters




---



##### 



Juniata Valley Financial Corp. (Consolidated)
 Minimum RequirementFor CapitalActual
    
    
    Adequacy PurposesAmount
    
    
    Ratio
    
    
    Amount
    
    
    RatioAs of December 31, 2010:Total Capital
    
    $
    51,977
    
    
    
    19.35
    %
    
    $
    21,492
    
    
    
    8.00
    %(to Risk Weighted Assets)Tier 1 Capital
    
    
    49,141
    
    
    
    18.29
    %
    
    
    10,746
    
    
    
    4.00
    %(to Risk Weighted Assets)Tier 1 Capital
    
    
    49,141
    
    
    
    11.25
    %
    
    
    17,473
    
    
    
    4.00
    %(to Average Assets)As of December 31, 2009:Total Capital
    
    $
    51,773
    
    
    
    18.49
    %
    
    $
    22,396
    
    
    
    8.00
    %(to Risk Weighted Assets)Tier 1 Capital
    
    
    49,054
    
    
    
    17.52
    %
    
    
    11,198
    
    
    
    4.00
    %(to Risk Weighted Assets)Tier 1 Capital
    
    
    49,054
    
    
    
    11.33
    %
    
    
    17,318
    
    
    
    4.00
    %(to Average Assets)
 The Juniata Valley Bank
 Minimum RegulatoryRequirements to beMinimum Requirement
    
    
    Well CapitalizedFor Capital
    
    
    under PromptActual
    
    
    Adequacy Purposes
    
    
    Corrective Action ProvisionsAmount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio
    
    
    Amount
    
    
    RatioAs of December 31, 2010:Total Capital
    
    $
    46,196
    
    
    
    17.46
    %
    
    $
    21,171
    
    
    
    8.00
    %
    
    $
    26,464
    
    
    
    10.00
    %(to Risk Weighted Assets)Tier 1 Capital
    
    
    43,354
    
    
    
    16.38
    %
    
    
    10,586
    
    
    
    4.00
    %
    
    
    15,878
    
    
    
    6.00
    %(to Risk Weighted Assets)Tier 1 Capital
    
    
    43,354
    
    
    
    10.19
    %
    
    
    17,016
    
    
    
    4.00
    %
    
    
    21,270
    
    
    
    5.00
    %(to Average Assets)As of December 31, 2009:Total Capital
    
    $
    45,675
    
    
    
    16.54
    %
    
    $
    22,086
    
    
    
    8.00
    %
    
    $
    27,608
    
    
    
    10.00
    %(to Risk Weighted Assets)Tier 1 Capital
    
    
    42,956
    
    
    
    15.56
    %
    
    
    11,043
    
    
    
    4.00
    %
    
    
    16,565
    
    
    
    6.00
    %(to Risk Weighted Assets)Tier 1 Capital
    
    
    42,956
    
    
    
    10.01
    %
    
    
    17,168
    
    
    
    4.00
    %
    
    
    21,460
    
    
    
    5.00
    %(to Average Assets)




---



##### 



16. Calculation Of Earnings Per Share
  Years Ended December 31,2010
    
    
    2009
    
    
    2008(Amounts, except earnings per share, in thousands)Net income
    
    $
    4,915
    
    
    $
    5,106
    
    
    $
    5,724Weighted-average common shares outstanding
    
    
    4,297
    
    
    
    4,341
    
    
    
    4,376Basic earnings per share
    
    $
    1.14
    
    
    $
    1.18
    
    
    $
    1.31Weighted-average common shares outstanding
    
    
    4,297
    
    
    
    4,341
    
    
    
    4,376Common stock equivalents due to effect of stock options
    
    
    4
    
    
    
    4
    
    
    
    10Total weighted-average common shares and equivalents
    
    
    4,301
    
    
    
    4,345
    
    
    
    4,386Diluted earnings per share
    
    $
    1.14
    
    
    $
    1.18
    
    
    $
    1.31Anti-dilutive stock options outstanding
    
    
    70
    
    
    
    73
    
    
    
    33




---



##### 



17. Comprehensive Income
  Year ended December 31, 2010Before
    
    
    Tax (Expense)Tax
    
    
    or
    
    
    Net-of-TaxAmount
    
    
    Benefit
    
    
    AmountNet income
    
    $
    6,545
    
    
    $
    (1,630
    )
    
    $
    4,915Other comprehensive income (loss):Unrealized losses on available for sale securities :Unrealized holding losses arising during the period
    
    
    (584
    )
    
    
    199
    
    
    
    (385
    )Unrealized holding gains from unconsolidated subsidiary
    
    
    2
    
    
    
    
    
    
    
    2Less reclassification adjustment for:gains included in net income
    
    
    (31
    )
    
    
    11
    
    
    
    (20
    )securities impairment charge
    
    
    40
    
    
    
    (14
    )
    
    
    26Unrecognized pension net gain
    
    
    71
    
    
    
    (24
    )
    
    
    47Unrecognized pension cost due to change in assumptions
    
    
    (625
    )
    
    
    212
    
    
    
    (413
    )Amortization of pension prior service cost
    
    
    (2
    )
    
    
    1
    
    
    
    (1
    )Amortization of pension net actuarial loss
    
    
    127
    
    
    
    (43
    )
    
    
    84Other comprehensive loss
    
    
    (1,002
    )
    
    
    342
    
    
    
    (660
    )Total comprehensive income
    
    $
    5,543
    
    
    $
    (1,288
    )
    
    $
    4,255
 Year ended December 31, 2009Before
    
    
    Tax (Expense)Tax
    
    
    or
    
    
    Net-of-TaxAmount
    
    
    Benefit
    
    
    AmountNet income
    
    $
    6,914
    
    
    $
    (1,808
    )
    
    $
    5,106Other comprehensive income (loss):Unrealized losses on available for sale securities :Unrealized holding losses arising during the period
    
    
    (79
    )
    
    
    27
    
    
    
    (52
    )Unrealized holding losses from unconsolidated
subsidiary
    
    
    (17
    )
    
    
    
    
    
    
    (17
    )Less reclassification adjustment for:gains included in net income
    
    
    (17
    )
    
    
    6
    
    
    
    (11
    )securities impairment charge
    
    
    226
    
    
    
    (77
    )
    
    
    149Unrecognized pension net gain
    
    
    413
    
    
    
    (140
    )
    
    
    273Unrecognized pension cost due to change in assumptions
    
    
    (7
    )
    
    
    2
    
    
    
    (5
    )Amortization of pension prior service cost
    
    
    (2
    )
    
    
    1
    
    
    
    (1
    )Amortization of pension net actuarial loss
    
    
    161
    
    
    
    (55
    )
    
    
    106Other comprehensive income
    
    
    678
    
    
    
    (236
    )
    
    
    442Total comprehensive income
    
    $
    7,592
    
    
    $
    (2,044
    )
    
    $
    5,548
 Year ended December 31, 2008Before
    
    
    Tax (Expense)Tax
    
    
    or
    
    
    Net-of-TaxAmount
    
    
    Benefit
    
    
    AmountNet income
    
    $
    7,781
    
    
    $
    (2,057
    )
    
    $
    5,724Other comprehensive income (loss):Unrealized gains on available for sale securities :Unrealized holding gains arising during the period
    
    
    324
    
    
    
    (110
    )
    
    
    214Unrealized holding gains from unconsolidated subsidiary
    
    
    5
    
    
    
    
    
    
    
    5Less reclassification adjustment for:gains included in net income
    
    
    (33
    )
    
    
    11
    
    
    
    (22
    )securities impairment charge
    
    
    554
    
    
    
    (188
    )
    
    
    366Unrecognized pension net loss
    
    
    (1,894
    )
    
    
    644
    
    
    
    (1,250
    )Unrecognized pension cost due to change in assumptions
    
    
    (42
    )
    
    
    14
    
    
    
    (28
    )Amortization of pension prior service cost
    
    
    (2
    )
    
    
    1
    
    
    
    (1
    )Amortization of pension net actuarial loss
    
    
    38
    
    
    
    (12
    )
    
    
    26Other comprehensive loss
    
    
    (1,050
    )
    
    
    360
    
    
    
    (690
    )Total comprehensive income
    
    $
    6,731
    
    
    $
    (1,697
    )
    
    $
    5,034




---



##### 



12/31/2010
    
    
    12/31/2009
    
    
    12/31/2008Unrealized gains on available for sale securities
    
    $
    399
    
    
    $
    776
    
    
    $
    707Unrecognized expense for defined benefit pension
    
    
    (1,864
    )
    
    
    (1,581
    )
    
    
    (1,954
    )Accumulated other comprehensive loss
    
    $
    (1,465
    )
    
    $
    (805
    )
    
    $
    (1,247
    )
 18. Fair Value Measurements
 Fair Value Measurements and Disclosures




---



##### 



Securities Available for Sale.
 Impaired Loans.
 Other Real Estate Owned




---



##### 



(Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Quoted Prices in
    
    
    Significant
    
    
    SignificantActive Markets
    
    
    Other
    
    
    OtherDecember 31,
    
    
    for Identical
    
    
    Observable
    
    
    Unobservable2010
    
    
    Assets
    
    
    Inputs
    
    
    InputsMeasured at fair value on a recurring basis:Debt securities available-for-sale:U.S. Treasury securities and obligations of U.S. Government agencies and corporations
    
    $
    37,696
    
    
    $
    
    
    
    $
    37,696
    
    
    $
    Obligations of state and political subdivisions
    
    
    38,893
    
    
    
    
    
    
    
    38,893
    
    
    
    Corporate notes
    
    
    1,028
    
    
    
    
    
    
    
    1,028
    
    
    
    Mortgage-backed securities
    
    
    1,345
    
    
    
    
    
    
    
    1,345
    
    
    
    Equity securities available-for-sale
    
    
    961
    
    
    
    961
    
    
    
    
    
    
    
    Measured at fair value on a non-recurring basis:Impaired loans
    
    
    1,567
    
    
    
    
    
    
    
    
    
    
    
    1,567Other real estate owned
    
    
    412
    
    
    
    
    
    
    
    
    
    
    
    412
 (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Quoted Prices in
    
    
    Significant
    
    
    SignificantActive Markets
    
    
    Other
    
    
    OtherDecember 31,
    
    
    for Identical
    
    
    Observable
    
    
    Unobservable2009
    
    
    Assets
    
    
    Inputs
    
    
    InputsMeasured at fair value on a recurring basis:Debt securities available-for-sale:U.S. Treasury securities and obligations of U.S. Government agencies and corporations
    
    $
    33,553
    
    
    $
    
    
    
    $
    33,553
    
    
    $
    Obligations of state and political subdivisions
    
    
    40,397
    
    
    
    
    
    
    
    40,397
    
    
    
    Corporate notes
    
    
    1,026
    
    
    
    
    
    
    
    1,026
    
    
    
    Mortgage-backed securities
    
    
    1,515
    
    
    
    
    
    
    
    1,515
    
    
    
    Equity securities available-for-sale
    
    
    865
    
    
    
    865
    
    
    
    
    
    
    
    Measured at fair value on a non-recurring basis:Impaired loans
    
    
    1,167
    
    
    
    
    
    
    
    
    
    
    
    1,167Other real estate owned
    
    
    476
    
    
    
    
    
    
    
    
    
    
    
    476




---



##### 



Fair Value of Financial Instruments
  Financial Instruments
 December 31, 2010
    
    
    December 31, 2009Carrying
    
    
    Fair
    
    
    Carrying
    
    
    FairValue
    
    
    Value
    
    
    Value
    
    
    ValueFinancial assets:Cash and due from banks
    
    $
    12,758
    
    
    $
    12,758
    
    
    $
    18,613
    
    
    $
    18,613Interest bearing deposits with banks
    
    
    218
    
    
    
    218
    
    
    
    82
    
    
    
    82Federal funds sold
    
    
    12,300
    
    
    
    12,300
    
    
    
    1,200
    
    
    
    1,200Interest bearing time deposits with banks
    
    
    1,345
    
    
    
    1,360
    
    
    
    1,420
    
    
    
    1,447Securities
    
    
    79,923
    
    
    
    79,923
    
    
    
    77,356
    
    
    
    77,356Restricted investment in FHLB stock
    
    
    2,088
    
    
    
    2,088
    
    
    
    2,197
    
    
    
    2,197Total loans, net of unearned interest
    
    
    298,102
    
    
    
    312,621
    
    
    
    311,630
    
    
    
    324,061Accrued interest receivable
    
    
    1,763
    
    
    
    1,763
    
    
    
    2,284
    
    
    
    2,284Financial liabilities:Non-interest bearing deposits
    
    
    60,696
    
    
    
    60,696
    
    
    
    55,030
    
    
    
    55,030Interest bearing deposits
    
    
    316,094
    
    
    
    323,003
    
    
    
    322,367
    
    
    
    327,724Securities sold under agreements to repurchase
    
    
    3,314
    
    
    
    3,314
    
    
    
    3,207
    
    
    
    3,207Long-term debt
    
    
    
    
    
    
    
    
    
    
    5,000
    
    
    
    5,077Other interest bearing liabilities
    
    
    1,200
    
    
    
    1,202
    
    
    
    1,146
    
    
    
    1,148Accrued interest payable
    
    
    499
    
    
    
    499
    
    
    
    681
    
    
    
    681Off-balance sheet financial instruments:Commitments to extend credit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Letters of credit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
     Interest bearing time deposits with banks
 Securities Available for Sale




---



##### 



Loans
 Impaired Loans
 Fixed rate time deposits
 Long-term debt and other interest bearing liabilities
 Commitments to extend credit and letters of credit




---



##### 



19. Employee Benefit Plans
 Stock Compensation Plan
      2010
    
    
    2009
    
    
    2008Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    AverageExercise
    
    
    
    
    
    
    Exercise
    
    
    
    
    
    
    ExerciseShares
    
    
    Price
    
    
    Shares
    
    
    Price
    
    
    Shares
    
    
    PriceOutstanding at beginning of year
    
    
    97,473
    
    
    $
    18.71
    
    
    
    85,985
    
    
    $
    18.73
    
    
    
    79,512
    
    
    $
    18.31Granted
    
    
    
    
    
    
    
    
    
    
    19,864
    
    
    
    17.22
    
    
    
    13,317
    
    
    
    21.10Exercised
    
    
    (1,960
    )
    
    
    14.18
    
    
    
    (6,698
    )
    
    
    14.14
    
    
    
    (2,477
    )
    
    
    14.72Forfeited
    
    
    (2,560
    )
    
    
    18.15
    
    
    
    (1,678
    )
    
    
    20.02
    
    
    
    (4,367
    )
    
    
    20.59Outstanding at end of year
    
    
    92,953
    
    
    $
    18.83
    
    
    
    97,473
    
    
    $
    18.71
    
    
    
    85,985
    
    
    $
    18.73Options exercisable at year-end
    
    
    78,402
    
    
    
    
    
    
    
    61,254
    
    
    $
    18.62
    
    
    
    58,187
    
    
    $
    17.69Weighted-average fair value of
of options granted
during the year
    
    $
    
    
    
    
    
    
    
    $
    2.75
    
    
    
    
    
    
    $
    3.37Intrinsic value of options
exercised during the year
    
    $
    5,918
    
    
    
    
    
    
    $
    15,792
    
    
    
    
    
    
    $
    15,598




---



##### 



Outstanding
    
    
    ExercisableContractual
    
    
    Average
    
    
    
    
    
    
    AverageExercise
    
    
    
    
    
    
    Average Life
    
    
    Exercise
    
    
    
    
    
    
    ExerciseGrant Date
    
    Price
    
    
    Shares
    
    
    (Years)
    
    
    Price
    
    
    Shares
    
    
    Price11/20/2001
    
    $
    14.10
    
    
    
    4,026
    
    
    
    0.39
    
    
    $
    14.10
    
    
    
    4,026
    
    
    $
    14.1011/19/2002
    
    
    14.25
    
    
    
    8,728
    
    
    
    1.46
    
    
    
    14.25
    
    
    
    8,728
    
    
    
    14.2511/18/2003
    
    
    15.13
    
    
    
    9,920
    
    
    
    1.87
    
    
    
    15.13
    
    
    
    9,920
    
    
    
    15.1311/15/2004
    
    
    20.25
    
    
    
    7,832
    
    
    
    2.16
    
    
    
    20.25
    
    
    
    7,832
    
    
    
    20.2510/18/2005
    
    
    24.00
    
    
    
    9,150
    
    
    
    2.61
    
    
    
    24.00
    
    
    
    9,150
    
    
    
    24.0010/17/2006
    
    
    21.00
    
    
    
    9,716
    
    
    
    3.33
    
    
    
    21.00
    
    
    
    8,971
    
    
    
    21.0010/16/2007
    
    
    20.05
    
    
    
    12,960
    
    
    
    4.17
    
    
    
    20.05
    
    
    
    10,981
    
    
    
    20.0510/21/2008
    
    
    21.10
    
    
    
    12,705
    
    
    
    5.74
    
    
    
    21.10
    
    
    
    9,462
    
    
    
    21.1010/20/2009
    
    
    17.22
    
    
    
    17,916
    
    
    
    6.68
    
    
    
    17.22
    
    
    
    9,332
    
    
    
    17.22
  Defined Benefit Retirement Plan
   (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Quoted Prices in
    
    
    Significant
    
    
    SignificantActive Markets
    
    
    Other
    
    
    OtherDecember 31,
    
    
    for Identical
    
    
    Observable
    
    
    Unobservable2010
    
    
    Assets
    
    
    Inputs
    
    
    InputsMeasured at fair value on a recurring basis:U.S. Government and agency securities
    
    $
    473
    
    
    $
    
    
    
    $
    473
    
    
    $
    Corporate bonds and notes
    
    
    2,890
    
    
    
    
    
    
    
    2,890
    
    
    
    Mutual fundsValue funds
    
    
    852
    
    
    
    852
    
    
    
    
    
    
    
    Blend funds
    
    
    605
    
    
    
    605
    
    
    
    
    
    
    
    Growth funds
    
    
    2,463
    
    
    
    2,463
    
    
    
    
    
    
    
    Common stocks
    
    
    4
    
    
    
    4
    
    
    
    
    
    
    
    Money market funds
    
    
    1,199
    
    
    
    1,199
    
    
    
    
    
    
    
    $
    8,486
    
    
    $
    5,123
    
    
    $
    3,363
    
    
    $
    
 (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Quoted Prices in
    
    
    Significant
    
    
    SignificantActive Markets
    
    
    Other
    
    
    OtherDecember 31,
    
    
    for Identical
    
    
    Observable
    
    
    Unobservable2009
    
    
    Assets
    
    
    Inputs
    
    
    InputsMeasured at fair value on a recurring basis:U.S. Government and agency securities
    
    $
    127
    
    
    $
    
    
    
    $
    127
    
    
    $
    Corporate bonds and notes
    
    
    2,957
    
    
    
    
    
    
    
    2,957
    
    
    
    Mutual fundsValue funds
    
    
    626
    
    
    
    626
    
    
    
    
    
    
    
    Blend funds
    
    
    388
    
    
    
    388
    
    
    
    
    
    
    
    Growth funds
    
    
    1,520
    
    
    
    1,520
    
    
    
    
    
    
    
    Common stocks
    
    
    4
    
    
    
    4
    
    
    
    
    
    
    
    Money market funds
    
    
    1,450
    
    
    
    1,450
    
    
    
    
    
    
    
    $
    7,072
    
    
    $
    3,988
    
    
    $
    3,084
    
    
    $
    




---



##### 



Years ended December 31,2010
    
    
    2009Change in projected benefit obligation (PBO)PBO at beginning of year
    
    $
    8,002
    
    
    $
    7,585Service cost
    
    
    186
    
    
    
    187Interest cost
    
    
    473
    
    
    
    449Change in assumptions
    
    
    626
    
    
    
    Actuarial loss
    
    
    85
    
    
    
    104Benefits paid
    
    
    (363
    )
    
    
    (323
    )PBO at end of year
    
    $
    9,009
    
    
    $
    8,002Change in plan assetsFair value of plan assets at beginning of year
    
    $
    8,361
    
    
    $
    6,715Actual return on plan assets, net of expenses
    
    
    727
    
    
    
    969Employer contribution
    
    
    500
    
    
    
    1,000Benefits paid
    
    
    (363
    )
    
    
    (323
    )Fair value of plan assets at end of year
    
    $
    9,225
    
    
    $
    8,361Reconciliation of funded status to net amount recognized
Overfunded status
    
    $
    216
    
    
    $
    359Accumulated benefit obligation
    
    $
    7,550
    
    
    $
    6,731
  2010
    
    
    2009
    
    
    2008Service cost during the year
    
    $
    186
    
    
    $
    187
    
    
    $
    179Interest cost on projected benefit
obligation
    
    
    473
    
    
    
    449
    
    
    
    441Expected return on plan assets
    
    
    (570
    )
    
    
    (459
    )
    
    
    (425
    )Net amortization
    
    
    (2
    )
    
    
    (2
    )
    
    
    (2
    )Recognized net actuarial loss
    
    
    127
    
    
    
    161
    
    
    
    39Net periodic benefit cost
    
    $
    214
    
    
    $
    336
    
    
    $
    232
  2010
    
    
    2009
    
    
    2008Discount rate
    
    
    5.50
    %
    
    
    6.00
    %
    
    
    6.00
    %Rate of compensation increase
    
    
    4.00
    
    
    
    4.00
    
    
    
    4.00
  2010
    
    
    2009
    
    
    2008Discount rate
    
    
    6.00
    %
    
    
    6.00
    %
    
    
    6.00
    %Expected long-term return on plan assets
    
    
    7.00
    
    
    
    7.00
    
    
    
    7.00Rate of compensation increase
    
    
    4.00
    
    
    
    4.00
    
    
    
    4.00
   2011
    
    
    2012
    
    
    2013
    
    
    2014
    
    
    2015
    
    
    2016-2020Estimated future benefit payments
    
    $
    419
    
    
    $
    427
    
    
    $
    431
    
    
    $
    443
    
    
    $
    460
    
    
    $
    2,678




---



##### 



Defined Contribution Plan
  Employee Stock Purchase Plan
  Supplemental Retirement Plans
  Deferred Compensation Plans
  Salary Continuation Plans
  20. Financial Instruments With Off-Balance Sheet Risk




---



##### 



December 31,2010
    
    
    2009Commitments to grant loans
    
    $
    23,623
    
    
    $
    31,587Unfunded commitments under lines of credit
    
    
    13,843
    
    
    
    15,002Outstanding letters of credit
    
    
    845
    
    
    
    974
    21. Related-Party Transactions
  22. Commitments And Contingent Liabilities




---



##### 



23. Subsequent Events
  24. Juniata Valley Financial Corp. (Parent Company Only)
  CONDENSED BALANCE SHEETS
 December 31,2010
    
    
    2009ASSETS:Cash and cash equivalents
    
    $
    54
    
    
    $
    451Interest bearing deposits with banks
    
    
    
    
    
    
    75Investment in bank subsidiary
    
    
    44,175
    
    
    
    44,554Investment in unconsolidated subsidiary
    
    
    3,550
    
    
    
    3,338Investment securities available for sale
    
    
    2,145
    
    
    
    2,097Other assets
    
    
    63
    
    
    
    113TOTAL ASSETS
    
    $
    49,987
    
    
    $
    50,628LIABILITIES:Accounts payable and other liabilities
    
    $
    11
    
    
    $
    25STOCKHOLDERS EQUITY
    
    
    49,976
    
    
    
    50,603TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
    
    $
    49,987
    
    
    $
    50,628
 CONDENSED STATEMENTS OF INCOME
 Years Ended December 31,2010
    
    
    2009
    
    
    2008INCOME:Interest on deposits with banks
    
    $
    
    
    
    $
    8
    
    
    $
    10Interest and dividends on investment securities available for sale
    
    
    40
    
    
    
    48
    
    
    
    103Dividends from bank subsidiary
    
    
    4,519
    
    
    
    3,765
    
    
    
    2,611Income from unconsolidated subsidiary
    
    
    250
    
    
    
    217
    
    
    
    207Securities impairment charge
    
    
    (40
    )
    
    
    (153
    )
    
    
    (554
    )Gain (Loss) on the sale of investment securities
    
    
    
    
    
    
    (5
    )
    
    
    5TOTAL INCOME
    
    
    4,769
    
    
    
    3,880
    
    
    
    2,382EXPENSE:Non-interest expense
    
    
    119
    
    
    
    102
    
    
    
    111TOTAL EXPENSE
    
    
    119
    
    
    
    102
    
    
    
    111INCOME BEFORE INCOME TAXES (BENEFIT) AND EQUITYIN UNDISTRIBUTED NET INCOME OF SUBSIDIARY
    
    
    4,650
    
    
    
    3,778
    
    
    
    2,271Income tax expense (benefit)
    
    
    21
    
    
    
    (22
    )
    
    
    (131
    )4,629
    
    
    
    3,800
    
    
    
    2,402Undistributed net income of subsidiary
    
    
    286
    
    
    
    1,306
    
    
    
    3,322NET INCOME
    
    $
    4,915
    
    
    $
    5,106
    
    
    $
    5,724




---



##### 



CONDENSED
STATEMENTS OF CASH FLOWS
 Years Ended December 31,2010
    
    
    2009
    
    
    2008Cash flows from operating activities:Net income
    
    $
    4,915
    
    
    $
    5,106
    
    
    $
    5,724Adjustments to reconcile net income to net cash
provided by operating activities:Undistributed net income of subsidiary
    
    
    (286
    )
    
    
    (1,306
    )
    
    
    (3,322
    )Net amortization of securities premiums
    
    
    2
    
    
    
    2
    
    
    
    3Realized losses (gains) on sales of investment securities
    
    
    
    
    
    
    5
    
    
    
    (5
    )Securities impairment charges
    
    
    40
    
    
    
    153
    
    
    
    554Income from unconsolidated subsidiary, net of dividends of $40, $46 and $0
    
    
    (210
    )
    
    
    (171
    )
    
    
    (207
    )(Increase) decrease in interest and other assets
    
    
    (1
    )
    
    
    5
    
    
    
    73Increase (decrease) in taxes payable
    
    
    22
    
    
    
    (29
    )
    
    
    (9
    )(Decrease) increase in accounts payable and other liabilities
    
    
    (14
    )
    
    
    25
    
    
    
    (6
    )Net cash provided by operating activities
    
    
    4,468
    
    
    
    3,790
    
    
    
    2,805Cash flows from investing activities:Purchases of available for sale securities
    
    
    
    
    
    
    (1,492
    )
    
    
    (720
    )Proceeds from the sale of available for sale securities
    
    
    
    
    
    
    4
    
    
    
    5Proceeds from the maturity and principal repayments of available for sale
investment securities
    
    
    
    
    
    
    1,345
    
    
    
    2,350Proceeds from the maturity of interest bearing time deposits
    
    
    75
    
    
    
    80
    
    
    
    200Net cash provided by (used in) investing activities
    
    
    75
    
    
    
    (63
    )
    
    
    1,835Cash flows from financing activities:Cash dividends
    
    
    (3,525
    )
    
    
    (3,386
    )
    
    
    (3,241
    )Purchase of treasury stock
    
    
    (1,476
    )
    
    
    (217
    )
    
    
    (1,518
    )Treasury stock issued for dividend reinvestment and
employee stock purchase plan
    
    
    61
    
    
    
    133
    
    
    
    78Net cash used in financing activities
    
    
    (4,940
    )
    
    
    (3,470
    )
    
    
    (4,681
    )Net (decrease) increase in cash and cash equivalents
    
    
    (397
    )
    
    
    257
    
    
    
    (41
    )Cash and cash equivalents at beginning of year
    
    
    451
    
    
    
    194
    
    
    
    235Cash and cash equivalents at end of year
    
    $
    54
    
    
    $
    451
    
    
    $
    194




---



##### 



25. Quarterly Results Of Operations (Unaudited)
  2010 Quarter endedMarch 31
    
    
    June 30
    
    
    September 30
    
    
    December 31Total interest income
    
    $
    5,554
    
    
    $
    5,436
    
    
    $
    5,339
    
    
    $
    5,245Total interest expense
    
    
    1,558
    
    
    
    1,387
    
    
    
    1,320
    
    
    
    1,237Net interest income
    
    
    3,996
    
    
    
    4,049
    
    
    
    4,019
    
    
    
    4,008Provision for loan losses
    
    
    285
    
    
    
    282
    
    
    
    70
    
    
    
    104Gains from the sale of assets
    
    
    11
    
    
    
    22
    
    
    
    34
    
    
    
    43Securities impairment charge
    
    
    
    
    
    
    
    
    
    
    (40
    )
    
    
    Other income
    
    
    1,012
    
    
    
    1,002
    
    
    
    942
    
    
    
    908Other expense
    
    
    3,145
    
    
    
    3,299
    
    
    
    3,158
    
    
    
    3,118Income before income taxes
    
    
    1,589
    
    
    
    1,492
    
    
    
    1,727
    
    
    
    1,737Income tax expense
    
    
    401
    
    
    
    354
    
    
    
    442
    
    
    
    433Net income
    
    $
    1,188
    
    
    $
    1,138
    
    
    $
    1,285
    
    
    $
    1,304Per-share data:Basic earnings
    
    $
    .27
    
    
    $
    .26
    
    
    $
    .30
    
    
    $
    .31Diluted earnings
    
    
    .27
    
    
    
    .26
    
    
    
    .30
    
    
    
    .31Cash dividends
    
    
    .20
    
    
    
    .20
    
    
    
    .21
    
    
    
    .21
 2009 Quarter endedMarch 31
    
    
    June 30
    
    
    September 30
    
    
    December 31Total interest income
    
    $
    5,936
    
    
    $
    5,915
    
    
    $
    5,747
    
    
    $
    5,670Total interest expense
    
    
    1,919
    
    
    
    1,862
    
    
    
    1,812
    
    
    
    1,686Net interest income
    
    
    4,017
    
    
    
    4,053
    
    
    
    3,935
    
    
    
    3,984Provision for loan losses
    
    
    135
    
    
    
    77
    
    
    
    165
    
    
    
    250Gains (losses) from the
sale of assets
    
    
    6
    
    
    
    27
    
    
    
    (33
    )
    
    
    (2
    )Securities impairment charge
    
    
    
    
    
    
    (226
    )
    
    
    
    
    
    
    Other income
    
    
    1,236
    
    
    
    1,108
    
    
    
    985
    
    
    
    1,070Other expense
    
    
    3,191
    
    
    
    3,315
    
    
    
    3,004
    
    
    
    3,109Income before income taxes
    
    
    1,933
    
    
    
    1,570
    
    
    
    1,718
    
    
    
    1,693Income tax expense
    
    
    523
    
    
    
    405
    
    
    
    430
    
    
    
    450Net income
    
    $
    1,410
    
    
    $
    1,165
    
    
    $
    1,288
    
    
    $
    1,243Per-share data:Basic earnings
    
    $
    .32
    
    
    $
    .27
    
    
    $
    .30
    
    
    $
    .29Diluted earnings
    
    
    .32
    
    
    
    .27
    
    
    
    .30
    
    
    
    .29Cash dividends
    
    
    .19
    
    
    
    .19
    
    
    
    .20
    
    
    
    .20




---



##### 



Common Stock Market Prices and Dividends
   2010DividendsQuarter Ended
    
    High
    
    
    Low
    
    
    DeclaredMarch 31
    
    $
    17.95
    
    
    $
    16.90
    
    
    $
    0.20June 30
    
    
    18.00
    
    
    
    16.25
    
    
    
    0.20September 30
    
    
    17.50
    
    
    
    17.00
    
    
    
    0.21December 31
    
    
    18.00
    
    
    
    16.55
    
    
    
    0.21
 2009DividendsQuarter Ended
    
    High
    
    
    Low
    
    
    DeclaredMarch 31
    
    $
    19.00
    
    
    $
    16.00
    
    
    $
    0.19June 30
    
    
    18.50
    
    
    
    16.00
    
    
    
    0.19September 30
    
    
    18.00
    
    
    
    16.80
    
    
    
    0.20December 31
    
    
    17.95
    
    
    
    17.10
    
    
    
    0.20
   Corporate Information
Corporate Headquarters
 Investor Information      JoAnn.McMinn@JVBonline.com




---



##### 



Information Availability
 www.JVBonline.com
 www.SEC.gov
   
 Investment Considerations
  Registrar and Transfer Agent
 www.RTCo.com  info@RTCo.com
 www.RTCo.com
   Annual Meeting of Shareholders