United States
Securities and Exchange Commission
 Washington, D.C. 20549
 Form 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2010
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number 0-30665
 CNB Financial Services, Inc.
  West Virginia
    
    550773918(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer Identification No.)101 S. Washington Street, Berkeley Springs, WV
    
    25411(Address of principal executive offices)
    
    (Zip Code)
  þ o
 o o
  Large Accelerated Filer o
    
    Accelerated Filer o
    
    Non-Accelerated Filer o
    
    Smaller Reporting Company þ(Do not check if a smaller reporting company)
 o þ




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##### 



CNB FINANCIAL SERVICES, INC.
  PAGEPART 1:
    
    FINANCIAL INFORMATIONItem 1.
    
    Financial StatementsConsolidated Statements of Financial Condition as of March 31, 2010 (Unaudited)and December 31, 2009
    
    
    3Consolidated Statements of Income for the Three Months ended March 31, 2010 and 2009 (Unaudited)
    
    
    4Consolidated Statements of Changes in Shareholders Equity for the Three Months Ended March 31, 2010 and 2009 (Unaudited)
    
    
    5Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2010 and 2009 (Unaudited)
    
    
    6Notes to Consolidated Financial Statements (Unaudited)
    
    
    7Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations for the Three Months ended March 31, 2010
    
    
    21Item 3.
    
    Quantitative and Qualitative Disclosures about Market Risk
    
    
    28Item 4.
    
    Controls and Procedures
    
    
    29PART II:
    
    OTHER INFORMATIONItem 1.
    
    Legal Proceedings
    
    
    30Item 1a.
    
    Risk Factors
    
    
    30Item 2.
    
    Unregistered Sale of Equity Securities and Use of Proceeds
    
    
    30Item 6.
    
    Exhibits and Reports on Form 8-K
    
    
    30SIGNATURES
    
    
    32
    2




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##### 



CNB FINANCIAL SERVICES, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
 March 31,
    
    
    December 31,2010
    
    
    2009(Unaudited)
    
    
    (Audited)ASSETSCash and due from banks
    
    $
    4,072,478
    
    
    $
    5,068,118Certificates of deposit investments
    
    
    1,740,137
    
    
    
    1,989,017Securities available for sale
(at approximate market value)
    
    
    73,473,070
    
    
    
    72,272,665Federal Home Loan Bank stock, at cost
    
    
    2,321,300
    
    
    
    2,321,300Loans and lease receivable, net
    
    
    191,378,494
    
    
    
    194,707,226Accrued interest receivable
    
    
    1,396,617
    
    
    
    1,334,704Foreclosed real estate (held for sale), net
    
    
    548,000
    
    
    
    386,500Premises and equipment, net
    
    
    5,469,965
    
    
    
    5,554,927Deferred income taxes
    
    
    1,619,316
    
    
    
    1,753,665Cash surrender value of life insurance
    
    
    1,607,641
    
    
    
    1,601,720Intangible assets
    
    
    134,749
    
    
    
    162,628Other assets
    
    
    1,803,105
    
    
    
    2,345,418TOTAL ASSETS
    
    $
    285,564,872
    
    
    $
    289,497,888LIABILITIES AND SHAREHOLDERS EQUITYLIABILITIESDeposits:Demand
    
    $
    43,102,419
    
    
    $
    43,381,922Interest-bearing demand
    
    
    34,538,187
    
    
    
    35,564,826Savings
    
    
    26,452,224
    
    
    
    24,925,247Time, $100,000 and over
    
    
    73,896,033
    
    
    
    72,982,196Other time
    
    
    75,191,237
    
    
    
    75,437,663$
    253,180,100
    
    
    $
    252,291,854Accrued interest payable
    
    
    1,091,204
    
    
    
    1,170,417FHLB borrowings
    
    
    1,100,000
    
    
    
    6,400,000Accrued expenses and other liabilities
    
    
    3,823,693
    
    
    
    4,005,322TOTAL LIABILITIES
    
    $
    259,194,997
    
    
    $
    263,867,593SHAREHOLDERS EQUITYCommon stock, $1 par value; 5,000,000 shares
authorized; 458,048 shares issued at March 31, 2010 and
December 31, 2009 and 442,804 and 443,648 outstanding at
March 31, 2010 and December 31, 2009, respectively
    
    $
    458,048
    
    
    $
    458,048Capital surplus
    
    
    4,163,592
    
    
    
    4,163,592Retained earnings
    
    
    22,903,255
    
    
    
    22,476,562Accumulated other comprehensive income (loss)
    
    
    (290,284
    )
    
    
    (642,839
    )$
    27,234,611
    
    
    $
    26,455,363Less treasury stock, at cost, 15,244 shares at March 31, 2010
and 14,400 shares at December 31, 2009
    
    
    (864,736
    )
    
    
    (825,068
    )TOTAL SHAREHOLDERS EQUITY
    
    $
    26,369,875
    
    
    $
    25,630,295TOTAL LIABILITIES AND SHAREHOLDERS EQUITY
    
    $
    285,564,872
    
    
    $
    289,497,888
  3




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##### 



CNB FINANCIAL SERVICES, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
 Three months endedMarch 31,2010
    
    
    2009INTEREST INCOMEInterest and fees on loans
    
    $
    3,031,799
    
    
    $
    3,268,686Interest and dividends on securitiesU.S. Government agencies and
corporations
    
    
    55,657
    
    
    
    80,798Corporate bonds
    
    
    61,936
    
    
    
    99,220Mortgage backed securities
    
    
    308,256
    
    
    
    367,733State and political subdivisions
    
    
    308,377
    
    
    
    157,653Interest on certificates of deposit
    
    
    1,455
    
    
    
    2,566Interest on FHLB deposits
    
    
    54
    
    
    
    23Interest on federal funds sold
    
    
    1,095
    
    
    
    $
    3,768,629
    
    
    $
    3,976,679INTEREST EXPENSEInterest on interest bearing demand,
savings and time deposits
    
    $
    1,237,523
    
    
    $
    1,259,205Interest on FHLB borrowings
    
    
    23,583
    
    
    
    86,833$
    1,261,106
    
    
    $
    1,346,038NET INTEREST INCOME
    
    $
    2,507,523
    
    
    $
    2,630,641PROVISION FOR LOAN LOSSES
    
    
    455,000
    
    
    
    390,000NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES
    
    $
    2,052,523
    
    
    $
    2,240,641NONINTEREST INCOMEService charges on deposit accounts
    
    $
    280,698
    
    
    $
    290,575Other service charges, commissions
and fees
    
    
    207,217
    
    
    
    182,478Other operating income
    
    
    24,000
    
    
    
    77,568Income from title company
    
    
    
    
    
    
    1,794Net gain on sales of loans
    
    
    4,694
    
    
    
    782Net gain on sales and calls of securities
    
    
    48,210
    
    
    
    33,695Net gain on sale of other real estate owned
    
    
    11,489
    
    
    
    Provision for losses on other real estate owned
    
    
    (48,000
    )
    
    
    (15,000
    )Net (loss) on disposal of premises, equpment and software
    
    
    (166
    )
    
    
    Net (loss) on sale of repossessed assets
    
    
    (7,150
    )
    
    
    $
    520,992
    
    
    $
    571,892NONINTEREST EXPENSESSalaries
    
    $
    741,737
    
    
    $
    689,801Employee benefits
    
    
    289,245
    
    
    
    295,324Occupancy of premises
    
    
    150,175
    
    
    
    110,370Furniture and equipment expense
    
    
    157,131
    
    
    
    160,067Other operating expenses
    
    
    728,915
    
    
    
    656,191$
    2,067,203
    
    
    $
    1,911,753INCOME BEFORE INCOME TAXES
    
    $
    506,312
    
    
    $
    900,780PROVISION FOR INCOME TAXES
    
    
    79,619
    
    
    
    269,047NET INCOME
    
    $
    426,693
    
    
    $
    631,733BASIC EARNINGS PER SHARE
    
    $
    0.96
    
    
    $
    1.41
  4




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##### 



CNB FINANCIAL SERVICES, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY (Unaudited)
 AccumulatedOther
    
    
    TotalCommon
    
    
    Treasury
    
    
    Capital
    
    
    Retained
    
    
    Comprehensive
    
    
    ShareholdersStock
    
    
    Stock
    
    
    Surplus
    
    
    Earnings
    
    
    Income
    
    
    EquityBALANCE, JANUARY 1, 2009
    
    $
    458,048
    
    
    $
    (570,512
    )
    
    $
    4,163,592
    
    
    $
    21,015,652
    
    
    $
    (1,848,990
    )
    
    $
    23,217,790Comprehensive income:Net income for three months
ended March 31, 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    631,733
    
    
    
    
    
    
    
    631,733Change in unrealized gains
(losses) on securities
available for sale (net of tax of $106,923)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    174,454
    
    
    
    174,454Total Comprehensive Income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    806,187Acquisition of treasury stock, at cost,
1,753 shares
    
    
    
    
    
    
    (82,991
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (82,991
    )BALANCE, MARCH 31, 2009
    
    $
    458,048
    
    
    $
    (653,503
    )
    
    $
    4,163,592
    
    
    $
    21,647,385
    
    
    $
    (1,674,536
    )
    
    $
    23,940,986BALANCE, JANUARY 1, 2010
    
    $
    458,048
    
    
    $
    (825,068
    )
    
    $
    4,163,592
    
    
    $
    22,476,562
    
    
    $
    (642,839
    )
    
    $
    25,630,295Comprehensive income:Net income for three months
ended March 31, 2010
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    426,693
    
    
    
    
    
    
    
    426,693Change in unrealized gains
(losses) on securities
available for sale (net of tax of $216,082)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    352,555
    
    
    
    352,555Total Comprehensive Income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    779,248Acquisition of treasury stock, at cost,
844 shares
    
    
    
    
    
    
    (39,668
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (39,668
    )BALANCE, MARCH 31, 2010
    
    $
    458,048
    
    
    $
    (864,736
    )
    
    $
    4,163,592
    
    
    $
    22,903,255
    
    
    $
    (290,284
    )
    
    $
    26,369,875
  5




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##### 



CNB FINANCIAL SERVICES, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS
 Three months endedMarch 31,2010
    
    
    2009CASH FLOWS FROM OPERATING ACTIVITIES:Net income
    
    $
    426,693
    
    
    $
    631,733Adjustments to reconcile net income to net cash
provided by operating activities:Depreciation and amortization on premises, equipment and software
    
    
    119,865
    
    
    
    127,750Provision for loan losses
    
    
    455,000
    
    
    
    390,000Provision for losses on other real estate owned
    
    
    48,000
    
    
    
    15,000Deferred income taxes
    
    
    (81,733
    )
    
    
    111,851Net (gain) on sale of securities
    
    
    (48,210
    )
    
    
    (33,695
    )Net (gain) loss on sale of real estate owned
    
    
    (11,358
    )
    
    
    Decrease in deferred gain on sale of real estate owned
    
    
    131
    
    
    
    Loss on disposal of premises, equipment and software
    
    
    166
    
    
    
    Net (gain) on loans sold
    
    
    (4,694
    )
    
    
    (782
    )Loans originated for sale
    
    
    (642,100
    )
    
    
    (223,000
    )Proceeds from loans sold
    
    
    646,794
    
    
    
    223,782(Increase) decrease in accrued interest receivable
    
    
    (61,913
    )
    
    
    43,094(Increase) decrease in other assets
    
    
    572,370
    
    
    
    (392,354
    )(Decrease) in accrued interest payable
    
    
    (79,213
    )
    
    
    (12,121
    )(Increase) in cash surrender value on life insurance in excess
of premiums paid
    
    
    
    
    
    
    (56,854
    )(Decrease) in accrued expenses and other liabilities
    
    
    (181,760
    )
    
    
    (236,486
    )Amortization of deferred loan (fees) cost
    
    
    25,400
    
    
    
    34,439Amortization (accretion) of premium and discount on securities
    
    
    42,585
    
    
    
    1,532Amortization (accretion) of premium and discount on certificates of deposit
    
    
    
    
    
    
    (132
    )NET CASH PROVIDED BY OPERATING ACTIVITIES
    
    $
    1,226,023
    
    
    $
    623,757CASH FLOWS FROM INVESTING ACTIVITIES:Net decrease in loans, not originated for sale
    
    $
    2,243,332
    
    
    $
    2,043,027Proceeds from sales of securities
    
    
    3,686,723
    
    
    
    1,319,395Proceeds from maturities, repayments and calls of securities
    
    
    2,315,418
    
    
    
    6,001,883Proceeds from maturities of certificates of deposit
    
    
    249,000
    
    
    
    Purchases of securities
    
    
    (6,645,821
    )
    
    
    (1,735,224
    )Purchases of certificates of deposit
    
    
    
    
    
    
    (1,237,620
    )Purchases of premises, equipment and software
    
    
    (19,830
    )
    
    
    (51,913
    )Proceeds from sale of real estate owned
    
    
    406,858
    
    
    
    Costs to acquire foreclosed real estate
    
    
    
    
    
    
    (10,679
    )Premiums paid on life insurance
    
    
    (5,921
    )
    
    
    (5,921
    )NET CASH PROVIDED BY INVESTING ACTIVITIES
    
    $
    2,229,759
    
    
    $
    6,322,948CASH FLOWS FROM FINANCING ACTIVITIES:Net increase in demand and savings deposits
    
    $
    220,835
    
    
    $
    1,733,789Net increase in time deposits
    
    
    667,411
    
    
    
    6,812,073Net (decrease) in FHLB borrowings
    
    
    (5,300,000
    )
    
    
    (13,795,000
    )Purchase of treasury stock
    
    
    (39,668
    )
    
    
    (82,991
    )NET CASH (USED IN) FINANCING ACTIVITIES
    
    $
    (4,451,422
    )
    
    $
    (5,332,129
    )NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
    
    $
    (995,640
    )
    
    $
    1,614,576CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR
    
    
    5,068,118
    
    
    
    4,770,724CASH AND CASH EQUIVALENTS AT END OF PERIOD
    
    $
    4,072,478
    
    
    $
    6,385,300SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:Cash paid during the period:Interest
    
    $
    1,340,319
    
    
    $
    1,333,917Income taxes
    
    $
    3,882
    
    
    $
    86Net transfer to foreclosed real estate, held for sale
from loans receivable
    
    $
    605,000
    
    
    $
    449,919Unrealized gain (loss) on investment securities
available for sale (net of tax)
    
    $
    352,555
    
    
    $
    174,454
  6




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##### 



CNB FINANCIAL SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
      3/31/2010
    
    3/31/2009Quarter ending
    
    
    443,629
    
    
    
    447,557
 7




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##### 



CNB FINANCIAL SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
    WeightedMarch 31, 2010
    
    
    AverageGross
    
    
    Gross
    
    
    Estimated
    
    
    TaxAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    Fair
    
    
    EquivalentCost
    
    
    Gains
    
    
    Losses
    
    
    Value
    
    
    YieldAvailable for sale:U.S. Government agencies
and corporationsWithin one year
    
    $
    1,995,716
    
    
    $
    8,023
    
    
    $
    
    
    
    $
    2,003,739
    
    
    
    4.29
    %After 1 but within 5 years
    
    
    2,002,027
    
    
    
    600
    
    
    
    4,556
    
    
    
    1,998,071
    
    
    
    1.60After 5 but within 10 years
    
    
    1,730,000
    
    
    
    2,226
    
    
    
    3,679
    
    
    
    1,728,547
    
    
    
    2.83$
    5,727,743
    
    
    $
    10,849
    
    
    $
    8,235
    
    
    $
    5,730,357
    
    
    
    2.91
    %Corporate BondsWithin one year
    
    $
    488,969
    
    
    $
    2,796
    
    
    $
    
    
    
    $
    491,765
    
    
    
    3.05
    %After 1 but within 5 years
    
    
    1,473,822
    
    
    
    99,728
    
    
    
    
    
    
    
    1,573,550
    
    
    
    5.87After 5 but within 10 years
    
    
    2,506,731
    
    
    
    72,660
    
    
    
    1,364
    
    
    
    2,578,027
    
    
    
    5.48$
    4,469,522
    
    
    $
    175,184
    
    
    $
    1,364
    
    
    $
    4,643,342
    
    
    
    5.34
    %States and political subdivisionsWithin one year
    
    $
    2,283,813
    
    
    $
    14,241
    
    
    $
    
    
    
    $
    2,298,054
    
    
    
    1.93
    %After 1 but within 5 years
    
    
    10,701,278
    
    
    
    399,401
    
    
    
    
    
    
    
    11,100,679
    
    
    
    3.00After 5 but within 10 years
    
    
    22,611,357
    
    
    
    363,875
    
    
    
    59,293
    
    
    
    22,915,939
    
    
    
    4.19$
    35,596,448
    
    
    $
    777,517
    
    
    $
    59,293
    
    
    $
    36,314,672
    
    
    
    3.69
    %Mortgage backed securities:Government issued or guaranteed
    
    $
    11,983,847
    
    
    $
    741,533
    
    
    $
    
    
    
    $
    12,725,380
    
    
    
    5.32
    %Collateralized mortgage obligations:Government issued or guaranteed
    
    $
    12,704,344
    
    
    $
    361,218
    
    
    $
    3,105
    
    
    $
    13,062,457
    
    
    
    4.12
    %Privately issued
    
    
    1,213,464
    
    
    
    
    
    
    
    216,602
    
    
    
    996,862
    
    
    
    7.90$
    13,917,808
    
    
    $
    361,218
    
    
    $
    219,707
    
    
    $
    14,059,319
    
    
    
    4.45
    %Total securities available for sale
    
    $
    71,695,368
    
    
    $
    2,066,301
    
    
    $
    288,599
    
    
    $
    73,473,070
    
    
    
    4.15
    %Restricted:Federal Home Loan Bank stock
    
    $
    2,321,300
    
    
    $
    
    
    
    $
    
    
    
    $
    2,321,300
    
    
    
    
    %Certificates of deposit
    
    $
    1,740,000
    
    
    $
    167
    
    
    $
    30
    
    
    $
    1,740,137
    
    
    
    0.30
    %
 8




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##### 



CNB FINANCIAL SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
  WeightedDecember 31, 2009
    
    
    AverageGross
    
    
    Gross
    
    
    Estimated
    
    
    TaxAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    Fair
    
    
    EquivalentCost
    
    
    Gains
    
    
    Losses
    
    
    Value
    
    
    YieldAvailable for sale:U.S. Government agencies
and corporationsWithin one year
    
    $
    864,592
    
    
    $
    18,441
    
    
    $
    
    
    
    $
    883,033
    
    
    
    3.68
    %After 1 but within 5 years
    
    
    2,006,039
    
    
    
    1,077
    
    
    
    17,468
    
    
    
    1,989,648
    
    
    
    1.60After 5 but within 10 years
    
    
    5,742,908
    
    
    
    29,965
    
    
    
    22,737
    
    
    
    5,750,136
    
    
    
    3.27$
    8,613,539
    
    
    $
    49,483
    
    
    $
    40,205
    
    
    $
    8,622,817
    
    
    
    2.92
    %Corporate BondsWithin one year
    
    $
    252,711
    
    
    $
    
    
    
    $
    7,614
    
    
    $
    245,097
    
    
    
    6.76
    %After 1 but within 5 years
    
    
    1,490,853
    
    
    
    47,318
    
    
    
    7,029
    
    
    
    1,531,142
    
    
    
    4.84After 5 but within 10 years
    
    
    2,997,344
    
    
    
    57,064
    
    
    
    19,138
    
    
    
    3,035,270
    
    
    
    5.60$
    4,740,908
    
    
    $
    104,382
    
    
    $
    33,781
    
    
    $
    4,811,509
    
    
    
    5.42
    %States and political subdivisionsWithin one year
    
    $
    2,898,507
    
    
    $
    19,824
    
    
    $
    
    
    
    $
    2,918,331
    
    
    
    1.92
    %After 1 but within 5 years
    
    
    9,567,178
    
    
    
    314,547
    
    
    
    357
    
    
    
    9,881,368
    
    
    
    2.98After 5 but within 10 years
    
    
    19,656,673
    
    
    
    216,197
    
    
    
    139,565
    
    
    
    19,733,305
    
    
    
    4.20$
    32,122,358
    
    
    $
    550,568
    
    
    $
    139,922
    
    
    $
    32,533,004
    
    
    
    3.63
    %Mortgage backed securities:Government issued or guaranteed
    
    $
    12,775,369
    
    
    $
    640,601
    
    
    $
    
    
    
    $
    13,415,970
    
    
    
    5.35
    %Collateralized mortgage obligations:Government issued or guaranteed
    
    $
    11,489,702
    
    
    $
    346,900
    
    
    $
    21,947
    
    
    $
    11,814,655
    
    
    
    4.12
    %Privately issued
    
    
    1,321,605
    
    
    
    
    
    
    
    246,895
    
    
    
    1,074,710
    
    
    
    7.17$
    12,811,307
    
    
    $
    346,900
    
    
    $
    268,842
    
    
    $
    12,889,365
    
    
    
    4.43
    %Total securities available for sale
    
    $
    71,063,481
    
    
    $
    1,691,934
    
    
    $
    482,750
    
    
    $
    72,272,665
    
    
    
    4.12
    %Restricted:Federal Home Loan Bank stock
    
    $
    2,321,300
    
    
    $
    
    
    
    $
    
    
    
    $
    2,321,300
    
    
    
    
    %Certificates of deposit
    
    $
    1,989,000
    
    
    $
    209
    
    
    $
    192
    
    
    $
    1,989,017
    
    
    
    0.33
    %
   9




---



##### 



CNB FINANCIAL SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
    March 31, 2010Less than 12 months
    
    
    12 months or more
    
    
    TotalFair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedDescription of Securities
    
    Value
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesCorporate bonds
    
    $
    504,781
    
    
    $
    1,364
    
    
    $
    
    
    
    $
    
    
    
    $
    504,781
    
    
    $
    1,364U.S. Government agencies
and corporations
    
    
    2,223,853
    
    
    
    8,235
    
    
    
    
    
    
    
    
    
    
    
    2,223,853
    
    
    
    8,235State and political subdivisions
    
    
    4,395,557
    
    
    
    48,394
    
    
    
    737,455
    
    
    
    10,899
    
    
    
    5,133,012
    
    
    
    59,293Collateralized mortgage obligations:Government issued or guaranteed
    
    
    460,278
    
    
    
    1,504
    
    
    
    347,567
    
    
    
    1,601
    
    
    
    807,845
    
    
    
    3,105Privately issued
    
    
    
    
    
    
    
    
    
    
    996,862
    
    
    
    216,602
    
    
    
    996,862
    
    
    
    216,602Certificates of deposit
    
    
    499,970
    
    
    
    30
    
    
    
    
    
    
    
    
    
    
    
    499,970
    
    
    
    30Total temporarily impaired
securities
    
    $
    8,084,439
    
    
    $
    59,527
    
    
    $
    2,081,884
    
    
    $
    229,102
    
    
    $
    10,166,323
    
    
    $
    288,629
 December 31, 2009Less than 12 months
    
    
    12 months or more
    
    
    TotalFair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedDescription of Securities
    
    Value
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesCorporate bonds
    
    $
    990,185
    
    
    $
    19,138
    
    
    $
    723,796
    
    
    $
    14,643
    
    
    $
    1,713,981
    
    
    $
    33,781U.S. Government agencies
and corporations
    
    
    3,207,366
    
    
    
    40,205
    
    
    
    
    
    
    
    
    
    
    
    3,207,366
    
    
    
    40,205State and political subdivisions
    
    
    8,689,560
    
    
    
    124,471
    
    
    
    929,785
    
    
    
    15,451
    
    
    
    9,619,345
    
    
    
    139,922Collateralized mortgage obligations:Government issued or guaranteed
    
    
    1,995,305
    
    
    
    19,204
    
    
    
    370,595
    
    
    
    2,742
    
    
    
    2,365,900
    
    
    
    21,946Privately issued
    
    
    
    
    
    
    
    
    
    
    1,074,651
    
    
    
    246,896
    
    
    
    1,074,651
    
    
    
    246,896Certificates of deposit
    
    
    499,808
    
    
    
    192
    
    
    
    
    
    
    
    
    
    
    
    499,808
    
    
    
    192Total temporarily impaired
securities
    
    $
    15,382,224
    
    
    $
    203,210
    
    
    $
    3,098,827
    
    
    $
    279,732
    
    
    $
    18,481,051
    
    
    $
    482,942
 10




---



##### 



CNB FINANCIAL SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
   March 31,
    
    
    December 31,2010
    
    
    2009Loans:Real estate
    
    $
    128,080,036
    
    
    $
    129,509,117Commercial real estate
    
    
    43,082,956
    
    
    
    43,972,033Consumer
    
    
    16,141,666
    
    
    
    16,683,611Commercial
    
    
    7,135,301
    
    
    
    7,276,430Overdrafts
    
    
    105,119
    
    
    
    203,337$
    194,545,078
    
    
    $
    197,644,528Leases
    
    
    549,736
    
    
    
    585,393$
    195,094,814
    
    
    $
    198,229,921Net deferred loan fees, costs,
premiums and discounts
    
    
    376,817
    
    
    
    380,025Allowance for loan losses
    
    
    (4,093,137
    )
    
    
    (3,902,720
    )$
    191,378,494
    
    
    $
    194,707,226
  March 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2009Balance, Beginning
    
    $
    3,902,720
    
    
    $
    2,751,386
    
    
    $
    2,751,386Provision charged to
operations
    
    
    455,000
    
    
    
    390,000
    
    
    
    1,852,726Recoveries
    
    
    23,449
    
    
    
    110,923
    
    
    
    116,135Loans charged off
    
    
    (288,032
    )
    
    
    (439,726
    )
    
    
    (817,527
    )Balance, Ending
    
    $
    4,093,137
    
    
    $
    2,812,583
    
    
    $
    3,902,720
 11




---



##### 



CNB FINANCIAL SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
   March 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2009Impaired loans without a valuation allowance
    
    $
    
    
    
    $
    
    
    
    $
    Impaired loans with a valuation allowance (1)
    
    
    839,116
    
    
    
    1,196,521
    
    
    
    935,785Total impaired loans
    
    $
    839,116
    
    
    $
    1,196,521
    
    
    $
    935,785Valuation allowance related to impaired loans
    
    $
    175,945
    
    
    $
    348,983
    
    
    $
    235,073
 
 (1)
    
    Some of these loans have government agency guarantees reducing the banks exposure by
$24,389 for  March 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2009Average investment in impaired loans
    
    $
    1,017,819
    
    
    $
    1,211,795
    
    
    $
    1,081,427Interest income recognized on impaired loans
    
    $
    11,453
    
    
    $
    14,143
    
    
    $
    56,662Interest income recognized on a cash basis on
impaired loans
    
    $
    11,453
    
    
    $
    14,143
    
    
    $
    56,662
  March 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2009Foreclosed real estate (other real estate owned)
    
    $
    548,000
    
    
    $
    698,898
    
    
    $
    386,500Impaired loans, not on nonaccrual
    
    
    812,017
    
    
    
    913,679
    
    
    
    826,658Nonaccrual loans, impaired (1)
    
    
    27,099
    
    
    
    282,842
    
    
    
    109,127Nonaccrual loans, not impaired
    
    
    1,096,539
    
    
    
    460,117
    
    
    
    1,456,367Loans past due 90 days or more still accruing interest
    
    
    
    
    
    
    
    
    
    
    Total non-performing assets
    
    $
    2,483,655
    
    
    $
    2,355,536
    
    
    $
    2,778,652
 
 (1)
    
    Some of these loans have government agency guarantees reducing the banks exposure by
$24,389 at March 31, 2010, $51,153 at March 31, 2009 and $31,379 at December 31, 2009. 12




---



##### 



CNB FINANCIAL SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
   Time Deposits
    
    
    All Time$100,000 and Over
    
    
    DepositsWithin 3 months
    
    $
    10,238,722
    
    
    $
    17,873,0313 months thru 6 months
    
    
    3,399,632
    
    
    
    8,250,8816 months thru 12 months
    
    
    35,625,137
    
    
    
    60,569,931Over 12 months
    
    
    24,632,542
    
    
    
    62,393,427$
    73,896,033
    
    
    $
    149,087,270
  March 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2009Federal Home Loan Bank advances
    
    $
    1,100,000
    
    
    $
    11,650,000
    
    
    $
    6,400,000
     March 31,2010
    
    
    2009Service cost
    
    $
    65,133
    
    
    $
    59,100Interest cost
    
    
    86,445
    
    
    
    79,062Expected return on plan assets
    
    
    (86,655
    )
    
    
    (81,877
    )Amortization of prior service costs
    
    
    3,086
    
    
    
    3,086Recognized net actuarial loss
    
    
    21,531
    
    
    
    18,321Net periodic plan cost
    
    $
    89,540
    
    
    $
    77,692
  13




---



##### 



CNB FINANCIAL SERVICES, INC  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
       
    
    Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for
identical assets or liabilities in active markets.
    
    Level 2 inputs to the valuation methodology include quoted prices for similar
assets and liabilities in active markets, and inputs that are observable for the asset or
liability, either directly or indirectly, for substantially the full term of the financial
instrument.
    
    Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement.
  Securities available for sale and certificates of deposit investments
  14




---



##### 



CNB FINANCIAL SERVICES, INC  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
   Valuation of our Financial Instruments by Fair Value Hierarchy Levels  Recurring Basis
 March 31, 2010(In Thousands)In Active
    
    
    SignificantMarkets for
    
    
    Other
    
    
    SignificantIdentical
    
    
    Observable
    
    
    UnobservableAssets
    
    
    Inputs
    
    
    InputsDescription
    
    Total
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Assets:U.S. government agencies and corporations
    
    $
    5,730
    
    
    $
    
    
    
    $
    5,730
    
    
    $
    Corporate bonds
    
    
    4,643
    
    
    
    
    
    
    
    4,643
    
    
    
    State and municipal securities
    
    
    36,315
    
    
    
    
    
    
    
    36,315
    
    
    
    Residential mortgage-backed securities
    
    
    12,726
    
    
    
    
    
    
    
    12,726
    
    
    
    Collateralized mortgage obligations
    
    
    14,059
    
    
    
    
    
    
    
    14,059
    
    
    
    Certificates of deposit investments
    
    
    1,740
    
    
    
    
    
    
    
    1,740
    
    
    
    
 December 31, 2009(In Thousands)In Active
    
    
    SignificantMarkets for
    
    
    Other
    
    
    SignificantIdentical
    
    
    Observable
    
    
    UnobservableAssets
    
    
    Inputs
    
    
    InputsDescription
    
    Total
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Assets:U.S. government agencies and corporations
    
    $
    8,623
    
    
    $
    
    
    
    $
    8,623
    
    
    $
    Corporate bonds
    
    
    4,812
    
    
    
    
    
    
    
    4,812
    
    
    
    State and municipal securities
    
    
    32,533
    
    
    
    
    
    
    
    32,533
    
    
    
    Residential mortgage-backed securities
    
    
    13,416
    
    
    
    
    
    
    
    13,416
    
    
    
    Collateralized mortgage obligtions
    
    
    12,889
    
    
    
    
    
    
    
    12,889
    
    
    
    Certificates of deposit investments
    
    
    1,989
    
    
    
    
    
    
    
    1,989
    
    
    
    
   Loans held for sale
  15




---



##### 



CNB FINANCIAL SERVICES, INC  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
  Impaired loans
   Other Real Estate Owned
   Valuation
of our Financial Instruments by Fair Value Hierarchy Levels 
Non-recurring Basis
 March 31, 2010(In Thousands)QuotedPrices InActive
    
    
    SignificantMarkets for
    
    
    Other
    
    
    SignificantIdentical
    
    
    Observable
    
    
    Unobservable
    
    
    RecognizedAssets
    
    
    Inputs
    
    
    Inputs
    
    
    GainsDescription
    
    Total
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    (Losses)Assets:Impaired loans, net of government agency
guarantees and reserve for losses
    
    $
    639
    
    
    $
    
    
    
    $
    639
    
    
    $
    
    
    
    $
    Other real estate owned
    
    $
    548
    
    
    $
    
    
    
    $
    548
    
    
    $
    
    
    
    $
    (37
    )
 December 31, 2009(In Thousands)QuotedPrices InActive
    
    
    SignificantMarkets for
    
    
    Other
    
    
    SignificantIdentical
    
    
    Observable
    
    
    Unobservable
    
    
    RecognizedAssets
    
    
    Inputs
    
    
    Inputs
    
    
    GainsDescription
    
    Total
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    (Losses)Assets:Impaired loans, net of government agency
guarantees and reserve for losses
    
    $
    669
    
    
    $
    
    
    
    $
    669
    
    
    $
    
    
    
    $
    Other real estate owned
    
    $
    387
    
    
    $
    
    
    
    $
    387
    
    
    $
    
    
    
    $
    (149
    )
 16




---



##### 



CNB FINANCIAL SERVICES, INC  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
    March 31, 2010
    
    
    December 31, 2009Carrying
    
    
    
    
    
    
    CarryingAmount
    
    
    Fair Value
    
    
    Amount
    
    
    Fair ValueFinancial Assets:Cash, due from banks and
federal funds sold
    
    $
    4,072,478
    
    
    $
    4,072,478
    
    
    $
    5,068,118
    
    
    $
    5,068,118Securities available for
sale
    
    
    73,473,070
    
    
    
    73,473,070
    
    
    
    72,272,665
    
    
    
    72,272,665Loans
    
    
    191,378,494
    
    
    
    187,823,331
    
    
    
    194,707,226
    
    
    
    191,450,941Accrued interest receivable
    
    
    1,396,617
    
    
    
    1,396,617
    
    
    
    1,334,704
    
    
    
    1,334,704Financial Liabilities:Demand deposits
    
    $
    104,092,830
    
    
    $
    104,092,830
    
    
    $
    103,871,995
    
    
    $
    103,871,995Time deposits
    
    
    149,087,270
    
    
    
    152,745,573
    
    
    
    148,419,859
    
    
    
    157,634,463Accrued interest payable
    
    
    1,091,204
    
    
    
    1,091,204
    
    
    
    1,170,417
    
    
    
    1,170,417FHLB borrowings
    
    
    1,100,000
    
    
    
    1,100,000
    
    
    
    6,400,000
    
    
    
    6,400,000Off-Balance SheetFinancial Instruments:Letters of credit
    
    $
    
    
    
    $
    250
    
    
    $
    
    
    
    $
    
  FASB Accounting Standards Codification (ASC) Topic 105  Generally Accepted Accounting
Principles (Statement No. 168, The FASB Accounting Standards Codification and the Hierarchy of
Generally Accepted Accounting Principles  a replacement of FASB Statement No. 162) (ASC 105).
 ASC Topic 855  Subsequent Events (Statement No. 165 , Subsequent Events) (ASC 855) .
 17




---



##### 



CNB FINANCIAL SERVICES, INC  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
  ASC Topic 860  Transfers and Servicing (Statement No. 166, Accounting for Transfers of
Financial Assets  an amendment of FASB Statement No. 140) (ASC 860).
 ASC Topic 810  Consolidation (Statement No. 160, Noncontrolling Interests in
Consolidated Financial Statement s  an amendment of ARB No. 51) (ASC 810).
 ASC Topic 810  Consolidation (Statement No. 167, Amendments to FASB Interpretation No. 46R)
(ASC 810)
 ASC Topic 820  Fair Value Measurements and Disclosures (Staff Position (FSP) FAS 157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have
Significantly Decreased and Identifying Transactions That Are Not Orderly) (ASC 820).
 ASC Topic 825  Financial Instruments (FSP FAS 107-1 and APB 28-1, Interim Disclosures about
Fair Value of Financial Instruments) (ASC 825).
 ASC Topic 320  Investments  Debt and Equity Securities (FSP FAS 115-2 and FAS 124-2, Recognition and Presentation of Other-Than-Temporary Impairments) (ASC 320).
 ASC Topic 805  Business Combinations (Statement No. 141 (Revised 2008), Business
Combinations) (ASC 805).
 ASC Topic 944  Financial Services  Insurance (Statement No. 163, Accounting for Financial
Guarantee Insurance Contracts  an interpretation of FASB Statement No. 60) (ASC 944).
 18




---



##### 



CNB FINANCIAL SERVICES, INC  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
   ASC Topic 715  Compensation  Retirement Benefits (FSP FAS 132R-1, Employers Disclosures
about Postretirement Benefit Plan Assets) (ASC 715).
 Accounting Standards Update (ASU) 2010-6  Fair Value Measurements and Disclosures (Topic
820): Improving Disclosures about Fair Value Measurements.
    Accounting Standards Update (ASU) 2010-1  Equity (Topic 505): Accounting for Distributions to
Shareholders with Components of Stock and Cash-a consensus of the FASB Emerging Issues Task Force.
 Accounting Standards Update (ASU) 2010-2  Consolidation (Topic 810): Accounting and Reporting
for Decreases in Ownership of a Subsidiary  a Scope Clarification.
 19




---



##### 



CNB FINANCIAL SERVICES, INC  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
  Accounting Standards Update (ASU) 2010-5  Compensation  Stock Compensation (Topic 718):
Escrowed Share Arrangements and the Presumption of Compensation.
 Accounting Standards Update (ASU) 2010-9 Subsequent Events (Topic 855): Amendments to Certain
Recognition and Disclosure Requirements.
     20




---



##### 



ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
          21




---



##### 



,
          22




---



##### 



TABLE 1. DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS EQUITY;
INTEREST RATES AND INTEREST DIFFERENTIAL
 MARCH 31, 2010
    
    
    MARCH 31, 2009QTR
    
    
    
    
    
    
    
    
    
    
    QTRAVERAGE
    
    
    QTR
    
    
    YIELD/
    
    
    AVERAGE
    
    
    QTR
    
    
    YIELD/BALANCE
    
    
    INTEREST
    
    
    RATE(4)
    
    
    BALANCE
    
    
    INTEREST
    
    
    RATE(4)(IN THOUSANDS OF DOLLARS)Interest earning assets:Federal funds sold
    
    $
    971
    
    
    $
    1
    
    
    
    0.13
    %
    
    $
    
    
    
    $
    
    
    
    
    0.00
    %Certificates of deposit
    
    
    1,876
    
    
    
    1
    
    
    
    0.21
    
    
    
    779
    
    
    
    2
    
    
    
    1.03Securities:Taxable
    
    
    46,104
    
    
    
    500
    
    
    
    4.34
    
    
    
    44,952
    
    
    
    551
    
    
    
    4.90Tax-exempt (1)
    
    
    28,729
    
    
    
    235
    
    
    
    4.96
    
    
    
    17,360
    
    
    
    155
    
    
    
    5.41Loans (net of unearned interest) (2)(5)(6)
    
    
    196,625
    
    
    
    2,997
    
    
    
    6.10
    
    
    
    202,981
    
    
    
    3,218
    
    
    
    6.34Total interest earning assets (1)
    
    $
    274,305
    
    
    $
    3,734
    
    
    
    5.45
    %
    
    $
    266,072
    
    
    $
    3,926
    
    
    
    5.90
    %Nonearning assets:Cash and due from banks
    
    $
    4,454
    
    
    
    
    
    
    
    
    
    
    $
    5,957Bank premises and equipment, net
    
    
    5,524
    
    
    
    
    
    
    
    
    
    
    
    5,810Other assets
    
    
    7,622
    
    
    
    
    
    
    
    
    
    
    
    6,229Allowance for loan losses
    
    
    (4,041
    )
    
    
    
    
    
    
    
    
    
    
    (2,916
    )Total assets
    
    $
    287,864
    
    
    
    
    
    
    
    
    
    
    $
    281,152Interest bearing liabilities:Savings deposits
    
    $
    25,484
    
    
    $
    6
    
    
    
    0.09
    %
    
    $
    24,121
    
    
    $
    10
    
    
    
    0.17
    %Time deposits
    
    
    148,990
    
    
    
    1,201
    
    
    
    3.22
    
    
    
    133,451
    
    
    
    1,215
    
    
    
    3.64NOW accounts
    
    
    22,698
    
    
    
    26
    
    
    
    0.46
    
    
    
    21,047
    
    
    
    25
    
    
    
    0.48Money market accounts
    
    
    11,191
    
    
    
    4
    
    
    
    0.14
    
    
    
    13,220
    
    
    
    9
    
    
    
    0.27Borrowings
    
    
    5,962
    
    
    
    24
    
    
    
    1.61
    
    
    
    19,683
    
    
    
    87
    
    
    
    1.77Total interest bearing liabilities
    
    $
    214,325
    
    
    $
    1,261
    
    
    
    2.35
    %
    
    $
    211,522
    
    
    $
    1,346
    
    
    
    2.55
    %Noninterest bearing liabilities:Demand deposits
    
    $
    43,115
    
    
    
    
    
    
    
    
    
    
    $
    40,843Other liabilities
    
    
    4,967
    
    
    
    
    
    
    
    
    
    
    
    5,576Shareholders equity
    
    
    25,457
    
    
    
    
    
    
    
    
    
    
    
    23,211Total liabilities and
shareholders equity
    
    $
    287,864
    
    
    
    
    
    
    
    
    
    
    $
    281,152Net interest income (1)
    
    
    
    
    
    $
    2,473
    
    
    
    
    
    
    
    
    
    
    $
    2,580Net interest spread (3)
    
    
    
    
    
    
    
    
    
    
    3.10
    %
    
    
    
    
    
    
    
    
    
    
    3.35
    %Net interest income to average
interest earning assets (1)
    
    
    
    
    
    
    
    
    
    
    3.61
    %
    
    
    
    
    
    
    
    
    
    
    3.88
    %
 
 (1)
    
    Yields are expressed on a tax equivalent basis using a 34% tax rate.(2)
    
    For the purpose of these computations, nonaccruing loans are included in the amounts of average loans outstanding.(3)
    
    Net interest spread is the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.(4)
    
    Yields/Rates are expressed on an annualized basis.(5)
    
    Interest income on loans excludes fees of $35,455 in 2010 and $50,841 in 2009.(6)
    
    Interest income on loans includes fees of $16,599 in 2010 and $24,717 in 2009 from student loans and lease receivables. 23




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24




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25




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March 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2009Impaired loans, not on nonaccrual
    
    
    812,017
    
    
    
    913,679
    
    
    
    826,658Nonaccrual loans, impaired (1)
    
    
    27,099
    
    
    
    282,842
    
    
    
    109,127Nonaccrual loans, not impaired
    
    
    1,096,539
    
    
    
    460,117
    
    
    
    1,456,367Loans past due 90 days or more still accruing interest
    
    
    
    
    
    
    
    
    
    
    Total non-performing loans
    
    $
    1,935,655
    
    
    $
    1,656,638
    
    
    $
    2,392,152Foreclosed real estate (other real estate owned)
    
    $
    548,000
    
    
    $
    698,898
    
    
    $
    386,500Total nonperforming assets
    
    $
    2,483,655
    
    
    $
    2,355,536
    
    
    $
    2,778,652Nonperforming loans/Total loans
    
    
    1.01
    %
    
    
    0.84
    %
    
    
    1.23
    %Nonperforming assets/Total assets
    
    
    0.87
    %
    
    
    0.85
    %
    
    
    0.96
    %Allowance for loan losses/Total loans
    
    
    2.14
    %
    
    
    1.42
    %
    
    
    2.00
    %
 
 (1)
    
    Some of these loans have government agency guarantees reducing the banks exposure by $24,389
at March 31, 2010, $51,153 at March 31, 2009 and $31,379 at December 31, 2009.    26




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March 31,
    
    
    December 31,2010
    
    
    2009Percent of
    
    
    
    
    
    
    Percent ofLoans in Each
    
    
    
    
    
    
    Loans in EachCategory to
    
    
    
    
    
    
    Category toIn thousands
    
    Amount
    
    
    Total Loans
    
    
    Amount
    
    
    Total LoansCommercial, financial
and agriculture
    
    $
    1,622
    
    
    
    26
    %
    
    $
    1,428
    
    
    
    26
    %Real estate  residential
mortgage
    
    
    1,641
    
    
    
    66
    
    
    
    1,613
    
    
    
    66Installment and other
    
    
    500
    
    
    
    8
    
    
    
    483
    
    
    
    8Impaired loans
    
    
    176
    
    
    
    
    
    
    
    235
    
    
    
    Unallocated
    
    
    154
    
    
    
    N/A
    
    
    
    144
    
    
    
    N/ATotal
    
    $
    4,093
    
    
    
    100
    %
    
    $
    3,903
    
    
    
    100
    %
       Components
    
    
    Actual
    
    
    Requiredof Capital
    
    
    Ratio
    
    
    RatioTier 1 Capital
    
    $
    26,212
    
    
    
    9.1
    %
    
    
    4.0
    %Total Risk Based Capital
    
    $
    28,388
    
    
    
    16.5
    %
    
    
    8.0
    %
 27




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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
        28




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ITEM 4. CONTROLS AND PROCEDURES
   29




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Total Number of Shares
    
    
    Maximum Number of SharesTotal Number
    
    
    
    
    
    
    Purchased
    
    
    that may yet be purchasedof Shares
    
    
    Average Price
    
    
    as Part of Publicly Announced
    
    
    underPeriod
    
    Purchased
    
    
    Paid per Share
    
    
    Plans or Programs
    
    
    the Plans or ProgramsBeginning balance December 31, 2009
    
    
    
    
    
    
    
    
    
    
    14,400
    
    
    
    31,405January 1, 2010 January 31, 2010
    
    
    
    
    
    $
    
    
    
    
    
    
    
    
    31,405February 1, 2010 February 28, 2010
    
    
    
    
    
    $
    
    
    
    
    
    
    
    
    31,405March 1, 2010 March 31, 2010
    
    
    844
    
    
    $
    47.00
    
    
    
    844
    
    
    
    30,561Total
    
    
    844
    
    
    
    
    
    
    
    15,244
  
        30




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31




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CNB Financial Services, Inc.(Registrant)Date
    
    May 13, 2010
    
    /s/ Thomas F. Rokisky, President/CEODate
    
    May 13, 2010
    
    /s/ Rebecca S. Stotler, Senior Vice President/CFO
 32