##### Table of Contents



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 1934
 For the quarterly period ended March 31, 2010
 OR
 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 000-13232
 Juniata Valley Financial Corp.
  Pennsylvania
    
    23-2235254(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)
 Bridge and Main Streets, Mifflintown, Pennsylvania
    
    17059(Address of principal executive offices)
    
    (Zip Code)
 (Registrants telephone number, including area code)
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o Yes þ No
  Class
    
    Outstanding as of May 7, 2010Common Stock ($1.00 par value)
    
    4,301,487 shares




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##### 



TABLE OF CONTENTS
 PART I  FINANCIAL INFORMATIONItem 1. Financial StatementsConsolidated Statements of Financial Condition
as of March 31, 2010 and December 31, 2009 (Unaudited)
    
    
    3Consolidated Statements of Income for the Three Months
Ended March 31, 2010 and 2009 (Unaudited)
    
    
    4Consolidated Statements of Changes in Stockholders 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
    
    
    7Item 2. Managements Discussion and Analysis
of Financial Condition and Results of Operations
    
    
    18Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    23Item 4. Controls and Procedures
    
    
    25PART II  OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    26Item 1A. Risk Factors
    
    
    26Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    26Item 3. Defaults upon Senior Securities
    
    
    26Item 4. (Removed and Reserved)
    
    
    26Item 5. Other Information
    
    
    26Item 6. Exhibits
    
    
    27Signatures
    
    
    27Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
   2




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1.
    
    Financial Statements
 Juniata Valley Financial Corp. and Subsidiary
 
 Consolidated Statements of Financial Condition
  March 31,
    
    
    December 31,2010
    
    
    2009ASSETSCash and due from banks
    
    $
    8,729
    
    
    $
    18,613Interest bearing deposits with banks
    
    
    93
    
    
    
    82Federal funds sold
    
    
    10,000
    
    
    
    1,200Cash and cash equivalents
    
    
    18,822
    
    
    
    19,895Interest bearing time deposits with banks
    
    
    1,345
    
    
    
    1,420Securities available for sale
    
    
    74,973
    
    
    
    77,356Restricted investment in Federal Home Loan Bank (FHLB) stock
    
    
    2,197
    
    
    
    2,197Investment in unconsolidated subsidiary
    
    
    3,391
    
    
    
    3,338Total loans, net of unearned interest
    
    
    311,663
    
    
    
    311,630Less: Allowance for loan losses
    
    
    (2,863
    )
    
    
    (2,719
    )Total loans, net of allowance for loan losses
    
    
    308,800
    
    
    
    308,911Premises and equipment, net
    
    
    6,849
    
    
    
    6,878Other real estate owned
    
    
    291
    
    
    
    476Bank owned life insurance and annuities
    
    
    13,196
    
    
    
    13,066Core deposit intangible
    
    
    288
    
    
    
    299Goodwill
    
    
    2,046
    
    
    
    2,046Accrued interest receivable and other assets
    
    
    6,581
    
    
    
    6,227Total assets
    
    $
    438,779
    
    
    $
    442,109LIABILITIES AND STOCKHOLDERS EQUITYLiabilities:Deposits:Non-interest bearing
    
    $
    54,758
    
    
    $
    55,030Interest bearing
    
    
    319,873
    
    
    
    322,367Total deposits
    
    
    374,631
    
    
    
    377,397Securities sold under agreements to repurchase
    
    
    2,552
    
    
    
    3,207Long-term debt
    
    
    5,000
    
    
    
    5,000Other interest bearing liabilities
    
    
    1,152
    
    
    
    1,146Accrued interest payable and other liabilities
    
    
    4,631
    
    
    
    4,756Total liabilities
    
    
    387,966
    
    
    
    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 -4,321,487 shares at March 31, 2010;4,337,587 shares at December 31, 2009
    
    
    4,746
    
    
    
    4,746Surplus
    
    
    18,327
    
    
    
    18,315Retained earnings
    
    
    36,799
    
    
    
    36,478Accumulated other comprehensive loss
    
    
    (644
    )
    
    
    (805
    )Cost of common stock in Treasury:424,339 shares at March 31, 2010;408,239 shares at December 31, 2009
    
    
    (8,415
    )
    
    
    (8,131
    )Total stockholders equity
    
    
    50,813
    
    
    
    50,603Total liabilities and stockholders equity
    
    $
    438,779
    
    
    $
    442,109
   3




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##### Table of Contents



Juniata Valley Financial Corp. and Subsidiary
 
 Consolidated Statements of Income
   Three Months EndedMarch 31,2010
    
    
    2009Interest income:Loans, including fees
    
    $
    5,036
    
    
    $
    5,289Taxable securities
    
    
    233
    
    
    
    308Tax-exempt securities
    
    
    275
    
    
    
    281Federal funds sold
    
    
    1
    
    
    
    2Other interest income
    
    
    9
    
    
    
    56Total interest income
    
    
    5,554
    
    
    
    5,936Interest expense:Deposits
    
    
    1,519
    
    
    
    1,878Securities sold under agreements to repurchase
    
    
    1
    
    
    
    1Short-term borrowings
    
    
    1
    
    
    
    1Long-term debt
    
    
    34
    
    
    
    34Other interest bearing liabilities
    
    
    3
    
    
    
    5Total interest expense
    
    
    1,558
    
    
    
    1,919Net interest income
    
    
    3,996
    
    
    
    4,017Provision for loan losses
    
    
    285
    
    
    
    135Net interest income after provision for loan losses
    
    
    3,711
    
    
    
    3,882Noninterest income:Trust fees
    
    
    120
    
    
    
    84Customer service fees
    
    
    382
    
    
    
    372Earnings on bank-owned life insurance and annuities
    
    
    122
    
    
    
    106Commissions from sales of non-deposit products
    
    
    96
    
    
    
    108Income from unconsolidated subsidiary
    
    
    56
    
    
    
    48Gain on sale of securities
    
    
    12
    
    
    
    (Loss) Gain on sales of other assets
    
    
    (1
    )
    
    
    6Prior period income from insurance sales
    
    
    
    
    
    
    323Other noninterest income
    
    
    236
    
    
    
    195Total noninterest income
    
    
    1,023
    
    
    
    1,242Noninterest expense:Employee compensation expense
    
    
    1,286
    
    
    
    1,286Employee benefits
    
    
    416
    
    
    
    444Occupancy
    
    
    233
    
    
    
    239Equipment
    
    
    119
    
    
    
    162Data processing expense
    
    
    365
    
    
    
    333Director compensation
    
    
    87
    
    
    
    110Professional fees
    
    
    93
    
    
    
    121Taxes, other than income
    
    
    130
    
    
    
    128FDIC Insurance premiums
    
    
    147
    
    
    
    88Amortization of intangibles
    
    
    11
    
    
    
    11Other noninterest expense
    
    
    258
    
    
    
    269Total noninterest expense
    
    
    3,145
    
    
    
    3,191Income before income taxes
    
    
    1,589
    
    
    
    1,933Provision for income taxes
    
    
    401
    
    
    
    523Net income
    
    $
    1,188
    
    
    $
    1,410Earnings per shareBasic
    
    $
    0.27
    
    
    $
    0.32Diluted
    
    $
    0.27
    
    
    $
    0.32Cash dividends declared per share
    
    $
    0.20
    
    
    $
    0.19Weighted average basic shares outstanding
    
    
    4,330,136
    
    
    
    4,340,633Weighted average diluted shares outstanding
    
    
    4,334,000
    
    
    
    4,345,622
   4




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Juniata Valley Financial Corp. and Subsidiary
 
 Consolidated Statements of Changes in Stockholders Equity
   Three Months Ended March 31, 2010Number
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Accumulatedof
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other
    
    
    
    
    
    
    TotalShares
    
    
    Common
    
    
    
    
    
    
    Retained
    
    
    Comprehensive
    
    
    Treasury
    
    
    StockholdersOutstanding
    
    
    Stock
    
    
    Surplus
    
    
    Earnings
    
    
    Loss
    
    
    Stock
    
    
    EquityBalance at December 31, 2009
    
    
    4,337,587
    
    
    $
    4,746
    
    
    $
    18,315
    
    
    $
    36,478
    
    
    $
    (805
    )
    
    $
    (8,131
    )
    
    $
    50,603Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,188
    
    
    
    
    
    
    
    
    
    
    
    1,188Change in unrealized gains on securities
available for sale, net of reclassification adjustment and tax effects
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    140
    
    
    
    
    
    
    
    140Defined benefit retirement plan
adjustments, net of tax effects
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    21
    
    
    
    
    
    
    
    21Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,349Cash dividends at $0.20 per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (867
    )
    
    
    
    
    
    
    
    
    
    
    (867
    )Stock-based compensation activity
    
    
    
    
    
    
    
    
    
    
    12
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12Purchase of treasury stock, at cost
    
    
    (16,100
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (284
    )
    
    
    (284
    )Balance at March 31, 2010
    
    
    4,321,487
    
    
    $
    4,746
    
    
    $
    18,327
    
    
    $
    36,799
    
    
    $
    (644
    )
    
    $
    (8,415
    )
    
    $
    50,813
 Three Months Ended March 31, 2009Number
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Accumulatedof
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other
    
    
    
    
    
    
    TotalShares
    
    
    Common
    
    
    
    
    
    
    Retained
    
    
    Comprehensive
    
    
    Treasury
    
    
    StockholdersOutstanding
    
    
    Stock
    
    
    Surplus
    
    
    Earnings
    
    
    Loss
    
    
    Stock
    
    
    EquityBalance at December 31, 2008
    
    
    4,341,055
    
    
    $
    4,746
    
    
    $
    18,324
    
    
    $
    34,758
    
    
    $
    (1,247
    )
    
    $
    (8,096
    )
    
    $
    48,485Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,410
    
    
    
    
    
    
    
    
    
    
    
    1,410Change in unrealized losses on securities
available for sale, net of reclassification adjustment and tax effects
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (151
    )
    
    
    
    
    
    
    (151
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,259Cash dividends at $0.19 per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (825
    )
    
    
    
    
    
    
    
    
    
    
    (825
    )Stock-based compensation activity
    
    
    
    
    
    
    
    
    
    
    10
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10Purchase of treasury stock, at cost
    
    
    (7,600
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (128
    )
    
    
    (128
    )Balance at March 31, 2009
    
    
    4,333,455
    
    
    $
    4,746
    
    
    $
    18,334
    
    
    $
    35,343
    
    
    $
    (1,398
    )
    
    $
    (8,224
    )
    
    $
    48,801
   5




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##### Table of Contents



Juniata Valley Financial Corp. and Subsidiary
 
 Consolidated Statements of Cash Flows
   Three Months Ended March 31,2010
    
    
    2009Operating activities:Net income
    
    $
    1,188
    
    
    $
    1,410Adjustments to reconcile net income to net cash provided by operating activities:Provision for loan losses
    
    
    285
    
    
    
    135Depreciation
    
    
    127
    
    
    
    154Net amortization of securities premiums
    
    
    70
    
    
    
    47Amortization of core deposit intangible
    
    
    11
    
    
    
    11Amortization of deferred net loan costs
    
    
    5
    
    
    
    12Deferral of net loan costs (fees)
    
    
    39
    
    
    
    (10
    )Net realized gains on sales of securities
    
    
    (12
    )
    
    
    Losses (gains) on sales of other assets
    
    
    1
    
    
    
    (6
    )Earnings on bank owned life insurance and annuities
    
    
    (122
    )
    
    
    (106
    )Deferred income tax expense
    
    
    19
    
    
    
    6Equity in earnings of unconsolidated subsidiary, net of dividends of $9 and $8
    
    
    (47
    )
    
    
    (40
    )Stock-based compensation expense
    
    
    12
    
    
    
    10Increase in accrued interest receivable and other assets
    
    
    (432
    )
    
    
    (447
    )(Decrease) increase in accrued interest payable and other liabilities
    
    
    (114
    )
    
    
    317Net cash provided by operating activities
    
    
    1,030
    
    
    
    1,493Investing activities:Purchases of:Securities available for sale
    
    
    (10,226
    )
    
    
    (15,339
    )Premises and equipment
    
    
    (98
    )
    
    
    (45
    )Bank owned life insurance and annuities
    
    
    (30
    )
    
    
    (29
    )Proceeds from:Maturities of and principal repayments on
securities available for sale
    
    
    12,754
    
    
    
    9,728Bank owned life insurance and annuities
    
    
    17
    
    
    
    18Sale of other real estate owned
    
    
    296
    
    
    
    62Sale of other assets
    
    
    11
    
    
    
    4Net decrease in interest-bearing time deposits
    
    
    75
    
    
    
    Net (increase) decrease in loans receivable
    
    
    (330
    )
    
    
    4,884Net cash provided by (used in) investing activities
    
    
    2,469
    
    
    
    (717
    )Financing activities:Net (decrease) increase in deposits
    
    
    (2,766
    )
    
    
    9,100Net decrease in short-term borrowings and securities
sold under agreements to repurchase
    
    
    (655
    )
    
    
    (8,272
    )Cash dividends
    
    
    (867
    )
    
    
    (825
    )Purchase of treasury stock
    
    
    (284
    )
    
    
    (128
    )Net cash used in financing activities
    
    
    (4,572
    )
    
    
    (125
    )Net (decrease) increase in cash and cash equivalents
    
    
    (1,073
    )
    
    
    651Cash and cash equivalents at beginning of period
    
    
    19,895
    
    
    
    12,457Cash and cash equivalents at end of period
    
    $
    18,822
    
    
    $
    13,108Supplemental information:Interest paid
    
    $
    1,595
    
    
    $
    1,944Income taxes paid
    
    $
    200
    
    
    $
    Supplemental schedule of noncash investing and financing activities:Transfer of loans to other real estate owned and repossessed assets
    
    $
    112
    
    
    $
    391
   6




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Juniata Valley Financial Corp. and Subsidiary
 
       ASU 2010-09
 Subsequent Events (Topic 855): Amendments to Certain
Recognition and Disclosure Requirements
    ASU 2010-13
 CompensationStock Compensation (Topic 718): Effect of
Denominating the Exercise Price of a Share-Based Payment Award in the Currency of the Market in
Which the Underlying Equity Security Trades
  7




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Three Months Ended March 31, 2010
    
    
    Three Months Ended March 31, 2009Before
    
    
    Tax Expense
    
    
    
    
    
    
    Before
    
    
    Tax ExpenseTax
    
    
    or
    
    
    Net-of-Tax
    
    
    Tax
    
    
    or
    
    
    Net-of-TaxAmount
    
    
    (Benefit)
    
    
    Amount
    
    
    Amount
    
    
    (Benefit)
    
    
    AmountNet income
    
    $
    1,589
    
    
    $
    401
    
    
    $
    1,188
    
    
    $
    1,933
    
    
    $
    523
    
    
    $
    1,410Other comprehensive income (loss):Unrealized gains (losses) on available for sale securities:Unrealized gains (losses) arising during the period
    
    
    221
    
    
    
    75
    
    
    
    146
    
    
    
    (229
    )
    
    
    (78
    )
    
    
    (151
    )Unrealized gains from unconsolidated subsidiary
    
    
    6
    
    
    
    
    
    
    
    6
    
    
    
    
    
    
    
    
    
    
    
    Less reclassification adjustment for:gains included in net income
    
    
    (18
    )
    
    
    (6
    )
    
    
    (12
    )
    
    
    
    
    
    
    
    
    
    
    Change in pension liability
    
    
    32
    
    
    
    11
    
    
    
    21
    
    
    
    
    
    
    
    
    
    
    
    Other comprehensive income (loss)
    
    
    241
    
    
    
    80
    
    
    
    161
    
    
    
    (229
    )
    
    
    (78
    )
    
    
    (151
    )Total comprehensive income
    
    $
    1,830
    
    
    $
    481
    
    
    $
    1,349
    
    
    $
    1,704
    
    
    $
    445
    
    
    $
    1,259
  3/31/2010
    
    
    12/31/2009
    
    
    3/31/2009Unrealized gains on available for sale securities
    
    $
    916
    
    
    $
    776
    
    
    $
    556Unrecognized expense for defined benefit pension
    
    
    (1,560
    )
    
    
    (1,581
    )
    
    
    (1,954
    )Accumulated other comprehensive loss
    
    $
    (644
    )
    
    $
    (805
    )
    
    $
    (1,398
    )
  8




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##### Table of Contents



(Amounts, except earnings per share, in thousands)
 Three Months
    
    
    Three MonthsEnded
    
    
    EndedMarch 31, 2010
    
    
    March 31, 2009Net income
    
    $
    1,188
    
    
    $
    1,410Weighted-average common shares outstanding
    
    
    4,330
    
    
    
    4,341Basic earnings per share
    
    $
    0.27
    
    
    $
    0.32Weighted-average common shares outstanding
    
    
    4,330
    
    
    
    4,341Common stock equivalents due to effect of stock options
    
    
    4
    
    
    
    5Total weighted-average common shares and equivalents
    
    
    4,334
    
    
    
    4,346Diluted earnings per share
    
    $
    0.27
    
    
    $
    0.32
     9




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##### Table of Contents



(Dollar amounts in thousands)
 Three Months EndedMarch 31,2010
    
    
    2009Components of net periodic pension costService cost
    
    $
    46
    
    
    $
    47Interest cost
    
    
    118
    
    
    
    112Expected return on plan assets
    
    
    (142
    )
    
    
    (115
    )Additional recognized amounts
    
    
    31
    
    
    
    40Net periodic pension cost
    
    $
    53
    
    
    $
    84
         10




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##### Table of Contents



March 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
    
    $
    30,524
    
    
    $
    30,739
    
    
    $
    235
    
    
    $
    (20
    )After five years but within ten years
    
    
    1,999
    
    
    
    1,998
    
    
    
    5
    
    
    
    (6
    )32,523
    
    
    
    32,737
    
    
    
    240
    
    
    
    (26
    )Obligations of state and political subdivisionsWithin one year
    
    
    6,171
    
    
    
    6,234
    
    
    
    63
    
    
    
    After one year but within five years
    
    
    31,005
    
    
    
    31,950
    
    
    
    974
    
    
    
    (29
    )After five years but within ten years
    
    
    544
    
    
    
    572
    
    
    
    28
    
    
    
    37,720
    
    
    
    38,756
    
    
    
    1,065
    
    
    
    (29
    )Corporate notesAfter one year but within five years
    
    
    1,000
    
    
    
    1,027
    
    
    
    27
    
    
    
    1,000
    
    
    
    1,027
    
    
    
    27
    
    
    
    Mortgage-backed securities
    
    
    1,381
    
    
    
    1,480
    
    
    
    99
    
    
    
    Equity securities
    
    
    975
    
    
    
    973
    
    
    
    100
    
    
    
    (102
    )Total
    
    $
    73,599
    
    
    $
    74,973
    
    
    $
    1,531
    
    
    $
    (157
    )
 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
    )
  11




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##### Table of Contents



Unrealized Losses at March 31, 2010Less 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
    
    $
    6,509
    
    
    $
    (26
    )
    
    $
    
    
    
    $
    
    
    
    $
    6,509
    
    
    $
    (26
    )Obligations of state and political
subdivisions
    
    
    2,546
    
    
    
    (29
    )
    
    
    
    
    
    
    
    
    
    
    2,546
    
    
    
    (29
    )Debt securities
    
    
    9,055
    
    
    
    (55
    )
    
    
    
    
    
    
    
    
    
    
    9,055
    
    
    
    (55
    )Equity securities
    
    
    
    
    
    
    
    
    
    
    555
    
    
    
    (102
    )
    
    
    555
    
    
    
    (102
    )Total temporarily impaired securities
    
    $
    9,055
    
    
    $
    (55
    )
    
    $
    555
    
    
    $
    (102
    )
    
    $
    9,610
    
    
    $
    (157
    )
 Unrealized Losses at December 31, 2009Less 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
    )
    12




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##### Table of Contents



Three Months EndedMarch 31,2010
    
    
    2009Gross proceeds from sales of securities
    
    $
    
    
    
    $
    Securities available for sale:Gross realized gains
    
    $
    12
    
    
    $
    Gross realized losses
    
    
    
    
    
    
    
  Fair Value Measurements and Disclosures
      13




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##### Table of Contents



Securities Available for Sale.
 Impaired Loans
  14




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##### Table of Contents



Other Real Estate Owned.
  (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Quoted Prices in
    
    
    Significant
    
    
    SignificantActive Markets
    
    
    Other
    
    
    OtherMarch 31,
    
    
    for Identical
    
    
    Observable
    
    
    Unobservable2010
    
    
    Assets
    
    
    Inputs
    
    
    InputsMeasured at fair value on a recurring basis:Equity securities available-for-sale
    
    $
    973
    
    
    $
    973
    
    
    $
    
    
    
    $
    Debt securities available-for-sale
    
    
    74,000
    
    
    
    
    
    
    
    74,000
    
    
    
    Measured at fair value on a non-recurring basis:Impaired loans
    
    
    3,351
    
    
    
    
    
    
    
    
    
    
    
    3,351Other real estate owned
    
    
    291
    
    
    
    
    
    
    
    
    
    
    
    291
 (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:Equity securities available-for-sale
    
    $
    865
    
    
    $
    865
    
    
    $
    
    
    
    $
    Debt securities available-for-sale
    
    
    76,491
    
    
    
    
    
    
    
    76,491
    
    
    
    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
  15




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##### Table of Contents



Financial Instruments
 March 31, 2010
    
    
    December 31, 2009Carrying
    
    
    Fair
    
    
    Carrying
    
    
    FairValue
    
    
    Value
    
    
    Value
    
    
    ValueFinancial assets:Cash and due from banks
    
    $
    8,729
    
    
    $
    8,729
    
    
    $
    18,613
    
    
    $
    18,613Interest bearing deposits with banks
    
    
    93
    
    
    
    93
    
    
    
    82
    
    
    
    82Federal funds sold
    
    
    10,000
    
    
    
    10,000
    
    
    
    1,200
    
    
    
    1,200Interest bearing time deposits with banks
    
    
    1,345
    
    
    
    1,486
    
    
    
    1,420
    
    
    
    1,447Securities
    
    
    74,973
    
    
    
    74,973
    
    
    
    77,356
    
    
    
    77,356Restricted investment in FHLB stock
    
    
    2,197
    
    
    
    2,197
    
    
    
    2,197
    
    
    
    2,197Total loans, net of unearned interest
    
    
    311,663
    
    
    
    325,945
    
    
    
    311,630
    
    
    
    324,061Accrued interest receivable
    
    
    2,473
    
    
    
    2,473
    
    
    
    2,284
    
    
    
    2,284Financial liabilities:Non-interest bearing deposits
    
    
    54,758
    
    
    
    54,758
    
    
    
    55,030
    
    
    
    55,030Interest bearing deposits
    
    
    319,873
    
    
    
    325,891
    
    
    
    322,367
    
    
    
    327,724Securities sold under agreements to repurchase
    
    
    2,552
    
    
    
    2,552
    
    
    
    3,207
    
    
    
    3,207Long-term debt
    
    
    5,000
    
    
    
    5,065
    
    
    
    5,000
    
    
    
    5,077Other interest bearing liabilities
    
    
    1,152
    
    
    
    1,154
    
    
    
    1,146
    
    
    
    1,148Accrued interest payable
    
    
    644
    
    
    
    644
    
    
    
    681
    
    
    
    681Off-balance sheet financial instruments:Commitments to extend credit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Letters of credit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
     Interest bearing time deposits with banks
 Securities Available for Sale
  16




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##### Table of Contents



Loans
 Impaired Loans
 Fixed rate time deposits
 Long-term debt
 Commitments to extend credit and letters of credit
    17




---



##### Table of Contents



Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
            18




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##### Table of Contents



March 31,
    
    
    December 31,
    
    
    Change2010
    
    
    2009
    
    
    $
    
    
    %Deposits:Demand,
non-interest
bearing
    
    $
    54,758
    
    
    $
    55,030
    
    
    $
    (272
    )
    
    
    (0.5
    %)NOW and money
market
    
    
    69,042
    
    
    
    75,766
    
    
    
    (6,724
    )
    
    
    (8.9
    %)Savings
    
    
    47,320
    
    
    
    42,536
    
    
    
    4,784
    
    
    
    11.2
    %Time deposits,
$100,000 and more
    
    
    39,376
    
    
    
    38,453
    
    
    
    923
    
    
    
    2.4
    %Other time deposits
    
    
    164,135
    
    
    
    165,612
    
    
    
    (1,477
    )
    
    
    (0.9
    %)Total deposits
    
    $
    374,631
    
    
    $
    377,397
    
    
    $
    (2,766
    )
    
    
    (0.7
    %)
  March 31,
    
    
    December 31,
    
    
    Change2010
    
    
    2009
    
    
    $
    
    
    %Loans:Commercial, financial and agricultural
    
    $
    33,829
    
    
    $
    33,783
    
    
    
    46
    
    
    
    0.1
    %Real estate  commercial
    
    
    40,552
    
    
    
    39,299
    
    
    
    1,253
    
    
    
    3.2
    %Real estate  construction
    
    
    24,535
    
    
    
    24,578
    
    
    
    (43
    )
    
    
    (0.2
    %)Real estate  mortgage
    
    
    135,253
    
    
    
    135,854
    
    
    
    (601
    )
    
    
    (0.4
    %)Home equity
    
    
    50,803
    
    
    
    52,893
    
    
    
    (2,090
    )
    
    
    (4.0
    %)Obligations of states and political
subdivisions
    
    
    15,432
    
    
    
    13,553
    
    
    
    1,879
    
    
    
    13.9
    %Personal
    
    
    11,259
    
    
    
    11,670
    
    
    
    (411
    )
    
    
    (3.5
    %)Total loans
    
    $
    311,663
    
    
    $
    311,630
    
    
    $
    33
    
    
    
    0.0
    %
  Periods Ended March 31,2010
    
    
    2009Balance of allowance  January 1
    
    $
    2,719
    
    
    $
    2,610Loans charged off
    
    
    (145
    )
    
    
    (215
    )Recoveries of loans previously charged off
    
    
    4
    
    
    
    2Net charge-offs
    
    
    (141
    )
    
    
    (213
    )Provision for loan losses
    
    
    285
    
    
    
    135Balance of allowance  end of period
    
    $
    2,863
    
    
    $
    2,532Ratio of net charge-offs during period to
average loans outstanding
    
    
    0.04
    %
    
    
    0.07
    %
  19




---



##### Table of Contents



(Dollar amounts in thousands)
 March 31, 2010
    
    
    December 31, 2009Non-performing loansNonaccrual loans
    
    $
    2,892
    
    
    $
    2,629Accruing loans past due 90 days or more
    
    
    1,039
    
    
    
    1,369Restructured loans
    
    
    
    
    
    
    Total
    
    $
    3,931
    
    
    $
    3,998Average loans outstanding
    
    $
    313,658
    
    
    $
    310,813Ratio of non-performing loans to
average loans outstanding
    
    
    1.25
    %
    
    
    1.29
    %
     Comparison of the Three Months Ended March 31, 2010 and 2009
    20




---



##### Table of Contents



Three Months EndedMarch 312010
    
    
    2009Return on average assets (annualized)
    
    
    1.09
    %
    
    
    1.32
    %Return on average equity (annualized)
    
    
    9.32
    %
    
    
    11.59
    %Average equity to average assets
    
    
    11.68
    %
    
    
    11.42
    %Non-interest income, excluding securities
gains, as a percentage of average assets
(annualized)
    
    
    0.93
    %
    
    
    1.16
    %Non-interest expense as a percentage of
average assets (annualized)
    
    
    2.88
    %
    
    
    3.00
    %
           21




---



##### Table of Contents



22




---



##### Table of Contents



Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
    23




---



##### Table of Contents



24




---



##### Table of Contents



Change in Net
    
    
    Change in NetInterest Income
    
    
    Interest Income
    
    
    Total Change inChange in Interest Rates
    
    Due to Interest
    
    
    Due to Imbedded
    
    
    Net Interest(Basis Points)
    
    Rate Risk (Static)
    
    
    Options
    
    
    Income400
    
    $
    149
    
    
    $
    170
    
    
    $
    319300
    
    
    76
    
    
    
    116
    
    
    
    192200
    
    
    5
    
    
    
    62
    
    
    
    67100
    
    
    (36
    )
    
    
    16
    
    
    
    (20
    )0
    
    
    
    
    
    
    
    
    
    
    -25
    
    
    (45
    )
    
    
    (5
    )
    
    
    (50
    )
   
 Item 4.
    
    Controls and Procedures
 Disclosure Controls and Procedures
    Changes in Internal Control Over Financial Reporting
   25




---



##### Table of Contents



PART II  OTHER INFORMATION
 
 Item 1.
    
    LEGAL PROCEEDINGS
  
 Item 1A.
    
    RISK FACTORS
  
 Item 2.
    
    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
  Total Number ofShares Purchased as
    
    
    Maximum Number ofTotal Number
    
    
    Average
    
    
    Part of Publicly
    
    
    Shares that May Yetof Shares
    
    
    Price Paid
    
    
    Announced Plans or
    
    
    Purchased Under thePeriod
    
    Purchased
    
    
    per Share
    
    
    Programs
    
    
    Plans or Programs (1)January 1-31, 2010
    
    
    
    
    
    $
    
    
    
    
    
    
    
    
    205,936February 1-28, 2010
    
    
    10,100
    
    
    
    17.77
    
    
    
    10,100
    
    
    
    195,836March 1-31, 2010
    
    
    6,000
    
    
    
    17.40
    
    
    
    6,000
    
    
    
    189,836Totals
    
    
    16,100
    
    
    
    
    
    
    
    16,100
    
    
    
    189,836
 (1)
    
    On March 23, 2001, the Corporation announced plans to buy back 100,000
(200,000 on a post-split basis) shares of its common stock. There is no expiration
date to this buyback plan, but subsequent to the initial plan, the Board of
Directors authorized the repurchase of 400,000 additional shares in 2005 and then
authorized 200,000 additional shares in September of 2008. As of May 7, 2010, the
number of shares that may yet be purchased under the program was 169,836. No
repurchase plan or program expired during the period covered by the table. The
Corporation has no stock repurchase plan or program that it has determined to
terminate prior to expiration or under which it does not intend to make further
purchases. 
 Item 3.
    
    DEFAULTS UPON SENIOR SECURITIES
  
 Item 4.
    
    (Removed and Reserved)
 
 Item 5.
    
    OTHER INFORMATION
   26




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##### Table of Contents



Item 6.
    
    EXHIBITS
 3.1
    
    
    Amended and Restated Articles of Incorporation (incorporated
by reference to Exhibit 4.1 to the Corporations Form S-3 Registration
Statement No. 333-129023 filed with the SEC on October 14, 2005)3.2
    
    
    Bylaws (incorporated by reference to Exhibit 3.2 to the
Corporations report on Form 8-K filed with the SEC on December 21, 2007)10.1
    
    
    2004 Executive Annual Incentive Plan (incorporated by
reference to Exhibit 10.15 to the Corporations report on Form 10-K filed with
the SEC on March 16, 2005)10.2
    
    
    Exhibits A-B to 2004 Executive Annual Incentive Plan
(incorporated by reference to Exhibit 10.1 to the Corporations report on Form
8-K filed with the SEC on March 19, 2010)31.1
    
    
    Rule 13a-14(a)/15d-14(a) Certification of President and
Chief Executive Officer31.2
    
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Financial
Officer32.1
    
    
    Section 1350 Certification of President and Chief Executive
Officer (furnished, not filed)32.2
    
    
    Section 1350 Certification of Chief Financial Officer
(furnished, not filed)
  Juniata Valley Financial Corp.
(Registrant)Date 05-07-2010
    By:
    /s/ Francis J. EvanitskyFrancis J. Evanitsky, President
and Chief Executive OfficerDate 05-07-2010
    By:
    /s/ JoAnn N. McMinnJoAnn N. McMinn, Chief Financial
Officer, Principal Accounting
Officer and Principal Financial Officer  27