# EDGAR Filing Document

**Accession Number:** 0000810958
**File Stem:** 0001558370-25-010889
**Filing Date:** 2025-8
**Character Count:** 233743
**Document Hash:** 407489191f685d3272d291caf8051a2b
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001558370-25-010889.hdr.sgml**: 20250808

**ACCESSION NUMBER**: 0001558370-25-010889

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 93

**CONFORMED PERIOD OF REPORT**: 20250630

**FILED AS OF DATE**: 20250808

**DATE AS OF CHANGE**: 20250808

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** CITIZENS & NORTHERN CORP
- **CENTRAL INDEX KEY:** 0000810958
- **STANDARD INDUSTRIAL CLASSIFICATION:** STATE COMMERCIAL BANKS [6022]
- **ORGANIZATION NAME:** 02 Finance
- **EIN:** 232451943
- **STATE OF INCORPORATION:** PA
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-16084
- **FILM NUMBER:** 251197092

**BUSINESS ADDRESS:**
- **STREET 1:** 90-92 MAIN ST
- **CITY:** WELLSBORO
- **STATE:** PA
- **ZIP:** 16901
- **BUSINESS PHONE:** 877-838-2517

**MAIL ADDRESS:**
- **STREET 1:** 90-92 MAIN ST
- **CITY:** WELLSBORO
- **STATE:** PA
- **ZIP:** 16901

?xml version='1.0' encoding='ASCII'? CITIZENS & NORTHERN CORPORATION_June 30, 2025

[**Table of Contents**](#TOC)

------

![Graphic](cznc-20250630x10q001.jpg)

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 10-Q**

**(Mark One)**

⌧ **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

For the quarterly period ended **June 30, 2025**

**or**

◻ **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: 000-16084

**CITIZENS & NORTHERN CORPORATION**

(Exact name of Registrant as specified in its charter)

---

| | |
|:---|:---|
| PENNSYLVANIA | 23-2451943 |
| (State or other jurisdiction of | (I.R.S. Employer |
| incorporation or organization) | Identification No.) |

---

90-92 MAIN STREET, WELLSBORO, PA 16901

(Address of principal executive offices) (Zip code)

570-724-3411

(Registrant's telephone number including area code)

Securities registered pursuant to Section 12(b) of the Act:

---

| | | |
|:---|:---|:---|
| **Title of Each Class** | **Trading Symbol** | **Name of Each Exchange on Which Registered** |
| Common Stock Par Value $1.00 | CZNC | NASDAQ Capital Market |

---

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ⌧ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ⌧ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definition of "large accelerated filer," accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ◻ Accelerated filer ⌧ Non-accelerated filer ◻ Smaller reporting company ☐ Emerging growth company ◻

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ⌧

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date.

---

| | |
|:---|:---|
| Common Stock ($1.00 par value) | 15,514,943 Shares Outstanding on August 5, 2025 |

---

X

------

[**Table of Contents**](#TOC)

#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

#### CITIZENS & NORTHERN CORPORATION
**Index**

---

| | |
|:---|:---|
| Part I. Financial Information |  |
| [Item 1. Financial Statements](#CONSOLIDATEDBALANCESHEETS_596259) |  |
| [Consolidated Balance Sheets (Unaudited) –June 30, 2025 and December 31, 202](#CONSOLIDATEDBALANCESHEETS_596259)4 | Page 3 |
| [Consolidated Statements of Income (Unaudited) – Three-month and Six-month Periods Ended June 30, 2025 and 2024](#ConsolidatedStatementsofIncome_816335) | Page 4 |
| [Consolidated Statements of Comprehensive Income (Unaudited) – Three-month and Six-month Periods Ended June 30, 2025 and 202](#ConsolidatedStatementsofComprehensiveInc)4 | Page 5 |
| [Consolidated Statements of Cash Flows (Unaudited) – Six-month Periods Ended June 30, 2025 and 2024](#CONSOLIDATEDSTATEMENTSOFCASHFLOWS_532462) | Page 6 |
| [Consolidated Statements of Changes in Stockholders' Equity (Unaudited) – Three-month and Six-month Periods Ended June 30, 2025 and 2024](#ConsolidatedStatementsofChangesinStockho) | Page 7 |
| [Notes to Unaudited Consolidated Financial Statements](#NotestoUnauditedConsolidatedFinancialSta) | Pages 8 –32 |
| [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](#ITEM2MANAGEMENTSDISCUSSIONANDANALYSISOFF) | Pages 33 – 55 |
| [Item 3. Quantitative and Qualitative Disclosures About Market Risk](#ITEM_3_QUANTITATIVE) | Pages 56 – 58 |
| [Item 4. Controls and Procedures](#ITEM4CONTROLSANDPROCEDURES_766777) | Page 58 |
| [Part II. Other Information](#PARTIIOTHERINFORMATION_553897) | Pages 59 – 61 |
| [Signatures](#SIGNATURES_404859) | Page 62 |

---

[**Table of Contents**](#TOC)

#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
**ITEM 1. FINANCIAL STATEMENTS**

**CONSOLIDATED BALANCE SHEETS**

**(In Thousands, Except Share and Per Share Data) (Unaudited)**

---

| | | |
|:---|:---|:---|
| <br>**(In Thousands, Except Share and Per Share Data)** | **June 30,** <br>**2025** | **December 31,** <br>**2024** |
| ASSETS |  |  |
| Cash and due from banks: |  |  |
| &nbsp;&nbsp;Noninterest-bearing | $26320 | $21110 |
| &nbsp;&nbsp;Interest-bearing | 73299 | 105064 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total cash and due from banks | 99619 | 126174 |
| Available-for-sale debt securities, at fair value | 406052 | 402380 |
| Loans receivable | 1919258 | 1895848 |
| Allowance for credit losses | (21699) | (20035) |
| Loans, net | 1897559 | 1875813 |
| Bank-owned life insurance | 52138 | 51214 |
| Accrued interest receivable | 8719 | 8735 |
| Bank premises and equipment, net | 21195 | 21338 |
| Foreclosed assets held for sale | 402 | 181 |
| Deferred tax asset, net | 17346 | 19098 |
| Goodwill | 52505 | 52505 |
| Core deposit intangibles, net | 1868 | 2080 |
| Other assets | 53472 | 51135 |
| TOTAL ASSETS | $2610875 | $2610653 |
| LIABILITIES |  |  |
| Deposits: |  |  |
| &nbsp;&nbsp;Noninterest-bearing | $507317 | $486566 |
| &nbsp;&nbsp;Interest-bearing | 1602459 | 1607343 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total deposits | 2109776 | 2093909 |
| Short-term borrowings | 533 | 2488 |
| Long-term borrowings - FHLB advances | 143894 | 165451 |
| Senior notes, net | 14934 | 14899 |
| Subordinated debt, net | 24889 | 24831 |
| Accrued interest and other liabilities | 30492 | 33791 |
| TOTAL LIABILITIES | 2324518 | 2335369 |
| COMMITMENTS AND CONTINGENT LIABILITIES |  |  |
| STOCKHOLDERS' EQUITY |  |  |
| Preferred stock, $1,000 par value; authorized 30,000 shares; $1,000 liquidation |  |  |
| &nbsp;&nbsp;preference per share; no shares issued | 0 | 0 |
| Common stock, par value $1.00 per share; authorized 30,000,000 shares; |  |  |
| &nbsp;&nbsp;issued 16,030,172 and outstanding 15,514,943 at June 30, 2025; |  |  |
| &nbsp;&nbsp;issued 16,030,172 and outstanding 15,433,494 at December 31, 2024 | 16030 | 16030 |
| Paid-in capital | 142982 | 143565 |
| Retained earnings | 169521 | 165778 |
| Treasury stock, at cost; 515,229 shares at June 30, 2025 and 596,678 |  |  |
| &nbsp;&nbsp;shares at December 31, 2024 | (11502) | (13328) |
| Accumulated other comprehensive loss | (30674) | (36761) |
| TOTAL STOCKHOLDERS' EQUITY | 286357 | 275284 |
| TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $2610875 | $2610653 |

---

The accompanying notes are an integral part of these unaudited consolidated financial statements.

[**Table of Contents**](#TOC)

**Consolidated Statements of Income**

**(In Thousands Except Per Share Data) (Unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended**  | **Three Months Ended**  | **Six Months Ended**  | **Six Months Ended**  |
| <br>**(In Thousands, Except Per Share Data)** | **June 30,** <br>**2025** | **June 30,** <br>**2024** | **June 30,** <br>**2025** | **June 30,** <br>**2024** |
| INTEREST INCOME |  |  |  |  |
| Interest and fees on loans: |  |  |  |  |
| &nbsp;&nbsp;Taxable | $28051 | $27490 | $55554 | $54193 |
| &nbsp;&nbsp;Tax-exempt | 602 | 594 | 1194 | 1139 |
| Income from available-for-sale debt securities: |  |  |  |  |
| &nbsp;&nbsp;Taxable | 2329 | 2137 | 4631 | 4273 |
| &nbsp;&nbsp;Tax-exempt | 579 | 560 | 1152 | 1113 |
| Other interest and dividend income | 893 | 545 | 1632 | 944 |
| Total interest and dividend income | 32454 | 31326 | 64163 | 61662 |
| INTEREST EXPENSE |  |  |  |  |
| Interest on deposits | 9284 | 9314 | 18876 | 18205 |
| Interest on short-term borrowings | 1 | 360  | 1  | 957 |
| Interest on long-term borrowings - FHLB advances | 1674 | 1855 | 3463 | 3311 |
| Interest on senior notes, net | 120 | 120  | 241 | 240 |
| Interest on subordinated debt, net | 233 | 232 | 465 | 463 |
| Total interest expense | 11312 | 11881 | 23046 | 23176 |
| Net interest income | 21142 | 19445 | 41117 | 38486 |
| Provision for credit losses | 2354 | 565 | 2590 | 1519 |
| Net interest income after provision for credit losses | 18788 | 18880 | 38527 | 36967 |
| NONINTEREST INCOME |  |  |  |  |
| Trust revenue | 1967 | 2014 | 4069 | 3911 |
| Brokerage and insurance revenue | 554 | 527 | 1052 | 1066 |
| Service charges on deposit accounts | 1422 | 1472 | 2862 | 2790 |
| Interchange revenue from debit card transactions | 1218 | 1089 | 2254 | 2102 |
| Net gains from sale of loans | 312 | 235 | 517 | 426 |
| Loan servicing fees, net | 173 | 130 | 311 | 360 |
| Increase in cash surrender value of life insurance | 466 | 444 | 923 | 914 |
| Other noninterest income | 2030 | 1943 | 3162 | 2960 |
| Total noninterest income | 8142 | 7854 | 15150 | 14529 |
| NONINTEREST EXPENSE |  |  |  |  |
| Salaries and employee benefits | 11067 | 11023 | 22826 | 22585 |
| Net occupancy and equipment expense | 1403 | 1333 | 2862 | 2783 |
| Data processing and telecommunications expense | 1981 | 2003 | 4052 | 3995 |
| Automated teller machine and interchange expense | 403 | 473 | 790 | 960 |
| Pennsylvania shares tax | 470 | 434 | 966 | 867 |
| Professional fees | 506 | 552 | 1023 | 1070 |
| Merger-related expenses | 167 | 0 | 167 | 0 |
| Other noninterest expense | 3401 | 3437 | 5755 | 5299 |
| Total noninterest expense | 19398 | 19255 | 38441 | 37559 |
| Income before income tax provision | 7532 | 7479 | 15236 | 13937 |
| Income tax provision | 1415 | 1366 | 2826 | 2518 |
| NET INCOME | $6117 | $6113 | $12410 | $11419 |
| EARNINGS PER COMMON SHARE - BASIC AND DILUTED | $0.40 | $0.40 | $0.80 | $0.74 |

---

The accompanying notes are an integral part of these unaudited consolidated financial statements.

[**Table of Contents**](#TOC)

**Consolidated Statements of Comprehensive Income** 

**(In Thousands) (Unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended**  | **Three Months Ended**  | **Six Months Ended**  | **Six Months Ended**  |
| <br>**(In Thousands)** | **June 30,** <br>**2025** | **June 30,** <br>**2024** | **June 30,** <br>**2025** | **June 30,** <br>**2024** |
| Net income | $6117 | $6113 | $12410 | $11419 |
| Available-for-sale debt securities: |  |  |  |  |
| &nbsp;&nbsp;Unrealized holding gains (losses) on available-for-sale debt securities | 2609 | (812) | 7778 | (3586) |
| &nbsp;&nbsp;Reclassification adjustment for losses (gains) realized in income | 0  | 0  | 0  | 0  |
| Other comprehensive income (loss) on available-for-sale debt securities | 2609 | (812) | 7778 | (3586) |
| Unfunded pension and postretirement obligations: |  |  |  |  |
| &nbsp;&nbsp;Changes from plan amendments and actuarial gains and losses | 0 | 0 | 69 | 394 |
| &nbsp;&nbsp;Amortization of prior service cost, net actuarial gain and curtailment gain included in net periodic benefit cost | (22) | (20) | (44) | (510) |
| Other comprehensive (loss) income on pension and postretirement obligations | (22) | (20) | 25 | (116) |
| Other comprehensive income (loss) before income tax | 2587 | (832) | 7803 | (3702) |
| Income tax related to other comprehensive (income) loss | (571) | 177 | (1716) | 778 |
| Other comprehensive income (loss), net | 2016 | (655) | 6087 | (2924) |
| Comprehensive income | $8133 | $5458 | $18497 | $8495 |

---

The accompanying notes are an integral part of these unaudited consolidated financial statements.

[**Table of Contents**](#TOC)

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(In Thousands) (Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended**  | **Six Months Ended**  |
|  | **June 30,**  | **June 30,**  |
| **(In Thousands)** | **2025** | **2024** |
| **CASH FLOWS FROM OPERATING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;Net income | $12410 | $11419 |
| &nbsp;&nbsp;Adjustments to reconcile net income to net cash provided by operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Provision for credit losses | 2590 | 1519 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net amortization of securities | 710 | 862 |
| &nbsp;&nbsp;&nbsp;&nbsp;Increase in cash surrender value of life insurance | (923) | (914) |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization of bank premises and equipment | 1115 | 1054 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net accretion of purchase accounting adjustments | (60) | (128) |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 656 | 716 |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes | 36 | (156) |
| &nbsp;&nbsp;&nbsp;&nbsp;Decrease in fair value of servicing rights | 101 | 43 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net gains from sale of loans | (517) | (426) |
| &nbsp;&nbsp;&nbsp;&nbsp;Origination of loans held for sale | (17775) | (13829) |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sales of loans held for sale | 16713 | 13033 |
| &nbsp;&nbsp;&nbsp;&nbsp;Increase in accrued interest receivable and other assets | (88) | (300) |
| &nbsp;&nbsp;&nbsp;&nbsp;(Decrease) increase in accrued interest and other liabilities | (4947) | 1363 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other | 75 | 106 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net Cash Provided by Operating Activities | 10096 | 14362 |
| **CASH FLOWS FROM INVESTING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;Proceeds from maturities of certificates of deposit | 250  | 250  |
| &nbsp;&nbsp;Proceeds from calls and maturities of available-for-sale debt securities | 20897  | 18174 |
| &nbsp;&nbsp;Purchase of available-for-sale debt securities | (17501) | (8012) |
| &nbsp;&nbsp;Redemption of Federal Home Loan Bank of Pittsburgh stock | 946 | 5241 |
| &nbsp;&nbsp;Purchase of Federal Home Loan Bank of Pittsburgh stock | (320) | (6491) |
| &nbsp;&nbsp;Purchase of Federal Reserve Bank stock | (22) | (24) |
| &nbsp;&nbsp;Net increase in loans | (24008) | (45120) |
| &nbsp;&nbsp;Purchase of premises and equipment | (1027) | (1404) |
| &nbsp;&nbsp;Proceeds from sale of foreclosed assets | 58  | 293  |
| &nbsp;&nbsp;Other | 18 | 28 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net Cash Used in Investing Activities | (20709) | (37065) |
| **CASH FLOWS FROM FINANCING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;Net increase in deposits | 15867 | 44507 |
| &nbsp;&nbsp;Net decrease in short-term borrowings | (1955) | (17000) |
| &nbsp;&nbsp;Proceeds from long-term borrowings - FHLB advances | 0  | 59386  |
| &nbsp;&nbsp;Repayments of long-term borrowings - FHLB advances | (21557) | (12055) |
| &nbsp;&nbsp;Purchases of treasury stock | (208) | (595) |
| &nbsp;&nbsp;Common dividends paid | (7839) | (7756) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net Cash (Used in) Provided by Financing Activities | (15692) | 66487 |
| **(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS** | (26305) | 43784 |
| **CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD** | 123574 | 52778 |
| **CASH AND CASH EQUIVALENTS, END OF PERIOD** | $97269 | $96562 |
| **SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:** |  |  |
| &nbsp;&nbsp;Assets acquired through foreclosure of real estate loans | $231  | $0  |
| &nbsp;&nbsp;Increase in other assets from surrender of bank-owned life insurance | $0  | $14289  |
| &nbsp;&nbsp;Leased assets obtained in exchange for new operating lease liabilities | $1126  | $187  |
| &nbsp;&nbsp;Interest paid | $23615 | $22399 |
| &nbsp;&nbsp;Income taxes paid | $4833 | $2716 |

---

The accompanying notes are an integral part of these unaudited consolidated financial statements.

[**Table of Contents**](#TOC)

**Consolidated Statements of Changes in Stockholders' Equity**

**(In Thousands, Except Share and Per Share Data) (Unaudited)**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| <br>**Three Months Ended June 30, 2025** | <br>**Common**<br>**Shares** | <br>**Treasury**<br>**Shares** | <br>**Common**<br>**Stock** | <br>**Paid-in**<br>**Capital** | <br>**Retained**<br>**Earnings** | **Accumulated**<br>**Other**<br>**Comprehensive**<br>**Loss** | <br>**Treasury**<br>**Stock** | <br>**Total** |
| **Balance, March 31, 2025** | **16030172** | **547324** | $**16030** | $**142968** | $**167741** | $**(32690)** | $**(12218)** | $**281831** |
| Net income |  |  |  |  | 6117 |  |  | 6117 |
| Other comprehensive income, net |  |  |  |  |  | 2016 |  | 2016 |
| Cash dividends declared on common stock, $.28 per share |  |  |  |  | (4337) |  |  | (4337) |
| Shares issued for dividend reinvestment plan |  | (20352) |  | (54) |  |  | 453 | 399 |
| Restricted stock granted |  | (12700) |  | (284) |  |  | 284 | 0  |
| Forfeiture of restricted stock |  | 957 |  | 21 |  |  | (21) | 0  |
| Stock-based compensation expense |  |  |  | 331 |  |  |  | 331 |
| **Balance, June 30, 2025** | **16030172** | **515229** | $**16030** | $**142982** | $**169521** | $**(30674)** | $**(11502)** | $**286357** |
| **Three Months Ended June 30, 2024** |  |  |  |  |  |  |  |  |
| **Balance, March 31, 2024** | **16030172** | **652107** | $**16030** | $**143016** | $**158051** | $**(40706)** | $**(14735)** | $**261656** |
| Net income |  |  |  |  | 6113 |  |  | 6113 |
| Other comprehensive loss, net |  |  |  |  |  | (655) |  | (655) |
| Cash dividends declared on common stock, $.28 per share |  |  |  |  | (4305) |  |  | (4305) |
| Shares issued for dividend reinvestment plan |  | (21902) |  | (90) |  |  | 495 | 405 |
| Forfeiture of restricted stock |  | 1489 |  | 36 |  |  | (36) | 0 |
| Stock-based compensation expense |  |  |  | 390 |  |  |  | 390 |
| Purchase of restricted stock for tax withholding |  | 22496 |  |  |  |  | (383) | (383) |
| **Balance, June 30, 2024** | **16030172** | **654190** | $**16030** | $**143352** | $**159859** | $**(41361)** | $**(14659)** | $**263221** |

---

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| <br>**Six Months Ended June 30, 2025** | <br>**Common**<br>**Shares** | <br>**Treasury**<br>**Shares** | <br>**Common**<br>**Stock** | <br>**Paid-in**<br>**Capital** | <br>**Retained**<br>**Earnings** | **Accumulated**<br>**Other**<br>**Comprehensive**<br>**Loss** | <br>**Treasury**<br>**Stock** | <br>**Total** |
| **Balance, December 31, 2024** | **16030172** | **596678** | $**16030** | $**143565** | $**165778** | $**(36761)** | $**(13328)** | $**275284** |
| Net income |  |  |  |  | 12410 |  |  | 12410 |
| Other comprehensive income, net |  |  |  |  |  | 6087 |  | 6087 |
| Cash dividends declared on common stock, $.56 per share |  |  |  |  | (8667) |  |  | (8667) |
| Shares issued for dividend reinvestment plan |  | (38743) |  | (69) |  |  | 864 | 795 |
| Restricted stock granted |  | (55661) |  | (1243) |  |  | 1243 | 0  |
| Forfeiture of restricted stock |  | 3222 |  | 73 |  |  | (73) | 0  |
| Stock-based compensation expense |  |  |  | 656 |  |  |  | 656  |
| Purchase of restricted stock for tax withholding |  | 9733 |  |  |  |  | (208) | (208) |
| **Balance, June 30, 2025** | **16030172** | **515229** | $**16030** | $**142982** | $**169521** | $**(30674)** | $**(11502)** | $**286357** |
| **Six Months Ended June 30, 2024** |  |  |  |  |  |  |  |  |
| **Balance, December 31, 2023** | **16030172** | **735037** | $**16030** | $**144388** | $**157028** | $**(38437)** | $**(16628)** | $**262381** |
| Net income |  |  |  |  | 11419 |  |  | 11419 |
| Other comprehensive loss, net |  |  |  |  |  | (2924) |  | (2924) |
| Cash dividends declared on common stock, $.56 per share |  |  |  |  | (8588) |  |  | (8588) |
| Shares issued for dividend reinvestment plan |  | (42788) |  | (156) |  |  | 968 | 812 |
| Restricted stock granted |  | (72860) |  | (1646) |  |  | 1646 | 0  |
| Forfeiture of restricted stock |  | 2076 |  | 50 |  |  | (50) | 0  |
| Stock-based compensation expense |  |  |  | 716 |  |  |  | 716 |
| Purchase of restricted stock for tax withholding |  | 10229 |  |  |  |  | (212) | (212) |
| Treasury stock purchases |  | 22496 |  |  |  |  | (383) | (383) |
| **Balance, June 30, 2024** | **16030172** | **654190** | $**16030** | $**143352** | $**159859** | $**(41361)** | $**(14659)** | $**263221** |

---

The accompanying notes are an integral part of these unaudited consolidated financial statements.

[**Table of Contents**](#TOC)

#### Notes to Unaudited Consolidated Financial Statements
1. BASIS OF INTERIM PRESENTATION AND STATUS OF RECENT ACCOUNTING PRONOUNCEMENTS

The consolidated financial statements include the accounts of Citizens & Northern Corporation and its subsidiaries, Citizens & Northern Bank ("C&N Bank"), Bucktail Life Insurance Company and Citizens & Northern Investment Corporation (collectively, "Corporation"). The consolidated financial statements also include C&N Bank's wholly-owned subsidiaries, C&N Financial Services, LLC and Northern Tier Holding LLC. C&N Bank is the sole member of C&N Financial Services, LLC and Northern Tier Holding LLC. All material intercompany balances and transactions have been eliminated in consolidation.

The consolidated financial information included herein, except the consolidated balance sheet dated December 31, 2024, is unaudited. Such information reflects all adjustments (consisting solely of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the financial position, results of operations, comprehensive income, cash flows and changes in stockholders' equity for the interim periods; however, the information does not include all disclosures required by accounting principles generally accepted in the United States of America ("U.S. GAAP") for a complete set of financial statements.

Operating results reported for the six-month period ended June 30, 2025 might not be indicative of the results for the year ending December 31, 2025. The Corporation evaluates subsequent events through the date of filing with the Securities and Exchange Commission.

#### RECENT ACCOUNTING PRONOUNCEMENTS
The Financial Accounting Standards Board (FASB) issues Accounting Standard Updates (ASUs) to communicate changes to the FASB Accounting Standards Codification (ASC). This section provides a summary description of recent ASUs that have significant implications (elected or required) within the consolidated financial statements, or that management expects may have a significant impact on consolidated financial statements issued in the foreseeable future.

**Recently Issued but Not Yet Effective Accounting Pronouncements**

In December 2023*,* the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures which improves the transparency of income tax disclosures by requiring (1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction. ASU No. 2023-09 is effective for public business entities for annual periods beginning after December 15, 2024. The ASU may be adopted on a prospective or retrospective basis and early adoption is permitted. The Corporation is currently evaluating the impact the new guidance will have on disclosures related to income taxes; however, management does not expect it will have a significant impact on its consolidated financial statements.

In December 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40), which requires disclosure of certain costs and expenses in the notes to the consolidated financial statements. The amendments in this ASU will become effective for fiscal years beginning after December 15, 2026, and will be effective for interim periods with fiscal years beginning after December 15, 2027, with early adoption permitted. The amendments will be applied prospectively with the option for retrospective application. The Corporation is currently evaluating the impact of the standard to our consolidated financial statement disclosures.

2. PER SHARE DATA

Earnings per common share are calculated using the two-class method to determine income attributable to common shareholders. Unvested restricted stock awards that contain nonforfeitable rights to dividends are considered participating securities under the two-class method. Distributed dividends and an allocation of undistributed net income to participating securities reduce the amount of income attributable to common shareholders. Income attributable to common shareholders is then divided by weighted-average common shares outstanding for the period to determine basic earnings per common share. The Corporation's basic and diluted earnings per share are the same because there are no potential dilutive shares of common stock outstanding.

[**Table of Contents**](#TOC)

#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

---

| | | | | |
|:---|:---|:---|:---|:---|
| **(In Thousands, Except Share and Per Share Data)** | **Three Months Ended**  | **Three Months Ended**  | **Six Months Ended**  | **Six Months Ended**  |
|  | **June 30,**  | **June 30,**  | **June 30,**  | **June 30,**  |
|  | **2025** | **2024** | **2025** | **2024** |
| &nbsp;&nbsp;Net income | $6117 | $6113 | $12410 | $11419 |
| &nbsp;&nbsp;Less: Dividends and undistributed earnings allocated to participating securities | (49) | (47) | (100) | (86) |
| &nbsp;&nbsp;Net income attributable to common shares | $6068 | $6066 | $12310 | $11333 |
| &nbsp;&nbsp;Weighted-average common shares outstanding | 15359004 | 15264533 | 15348824 | 15247557 |
| &nbsp;&nbsp;Earnings per common share - Basic and Diluted | $0.40 | $0.40 | $0.80 | $0.74 |
| Weighted-average nonvested restricted shares outstanding | 123844 | 118605 | 124570 | 115844 |

---

**3. COMPREHENSIVE INCOME** 

Comprehensive income is the total of (1) net income, and (2) all other changes in equity from non-stockholder sources, which are referred to as other comprehensive income (loss). The components of other comprehensive income (loss), and the related tax effects, are as follows:

---

| | | | |
|:---|:---|:---|:---|
| **(In Thousands)** | | | |
|  | **Before-Tax**<br>**Amount** | **Income Tax**<br>**Effect** | **Net-of-Tax**<br>**Amount** |
| **Three Months Ended June 30, 2025** |  |  |  |
| Available-for-sale debt securities: |  |  |  |
| &nbsp;&nbsp;Unrealized holding gains on available-for-sale debt securities | $2609 | $(576) | $2033 |
| &nbsp;&nbsp;Reclassification adjustment for (gains) realized in income | 0  | 0  | 0  |
| Other comprehensive income from available-for-sale debt securities | 2609 | (576) | 2033 |
| Unfunded pension and postretirement obligations: |  |  |  |
| &nbsp;&nbsp;Amortization of prior service cost and net actuarial loss included in net periodic benefit cost  | (22) | 5 | (17) |
| Other comprehensive loss on unfunded retirement obligations | (22) | 5 | (17) |
| Total other comprehensive income | $2587 | $(571) | $2016 |

---

---

| | | | |
|:---|:---|:---|:---|
| **(In Thousands)** | | | |
|  | **Before-Tax**<br>**Amount** | **Income Tax**<br>**Effect** | **Net-of-Tax**<br>**Amount** |
| **Three Months Ended June 30, 2024** |  |  |  |
| Available-for-sale debt securities: |  |  |  |
| &nbsp;&nbsp;Unrealized holding losses on available-for-sale debt securities | $(812) | $173 | $(639) |
| &nbsp;&nbsp;Reclassification adjustment for (gains) realized in income | 0  | 0  | 0  |
| Other comprehensive loss from available-for-sale debt securities | (812) | 173  | (639) |
| Unfunded pension and postretirement obligations: |  |  |  |
| &nbsp;&nbsp;Amortization of prior service cost and net actuarial loss included in net periodic benefit cost | (20) | 4 | (16) |
| Other comprehensive loss on unfunded retirement obligations | (20) | 4 | (16) |
| Total other comprehensive loss | $(832) | $177 | $(655) |

---

---

| | | | |
|:---|:---|:---|:---|
| **(In Thousands)** | | | |
|  | **Before-Tax**<br>**Amount** | **Income Tax**<br>**Effect** | **Net-of-Tax**<br>**Amount** |
| **Six Months Ended June 30, 2025** |  |  |  |
| Available-for-sale debt securities: |  |  |  |
| &nbsp;&nbsp;Unrealized holding gains on available-for-sale debt securities | $7778 | (1711) | $6067 |
| &nbsp;&nbsp;Reclassification adjustment for (gains) realized in income | 0  | 0  | 0  |
| Other comprehensive income from available-for-sale debt securities | 7778 | (1711) | 6067 |
| Unfunded pension and postretirement obligations: |  |  |  |
| &nbsp;&nbsp;Changes from plan amendments and actuarial gains and losses | 69 | (15) | 54 |
| &nbsp;&nbsp;Amortization of prior service cost and net actuarial gain included in net periodic benefit cost  | (44) | 10 | (34) |
| Other comprehensive income on unfunded retirement obligations | 25 | (5) | 20 |
| Total other comprehensive income | $7803 | $(1716) | $6087 |

---

[**Table of Contents**](#TOC)

---

| | | | |
|:---|:---|:---|:---|
| **(In Thousands)** | | | |
|  | **Before-Tax**<br>**Amount** | **Income Tax**<br>**Effect** | **Net-of-Tax**<br>**Amount** |
| **Six Months Ended June 30, 2024** |  |  |  |
| Available-for-sale debt securities: |  |  |  |
| &nbsp;&nbsp;Unrealized holding losses on available-for-sale debt securities | $(3586) | $754 | $(2832) |
| &nbsp;&nbsp;Reclassification adjustment for (gains) realized in income | 0  | 0  | 0  |
| Other comprehensive loss from available-for-sale debt securities | (3586) | 754  | (2832) |
| Unfunded pension and postretirement obligations: |  |  |  |
| &nbsp;&nbsp;Changes from plan amendments and actuarial gains and losses | 394 | (83) | 311 |
| &nbsp;&nbsp;Amortization of prior service cost and net actuarial loss and curtailment gain included in net periodic benefit cost | (510) | 107 | (403) |
| Other comprehensive loss on unfunded retirement obligations | (116) | 24 | (92) |
| Total other comprehensive loss | $(3702) | $778 | $(2924) |

---

The amounts shown in the table immediately above are included in the following line items in the consolidated statements of income:

---

| | |
|:---|:---|
| <br>**Description** | **Affected Line Item in the**<br>**Consolidated Statements of Income** |
| Amortization of prior service cost and net actuarial gain and curtailment gain included in net periodic benefit cost (before-tax) | Other noninterest expense |
| Income tax effect | Income tax provision |

---

Changes in the components of accumulated other comprehensive (loss) income are as follows and are presented net of tax:

---

| | | | |
|:---|:---|:---|:---|
| **(In Thousands)** | | | |
|  | **Unrealized**<br>**(Losses)**<br>**Gains**<br>**on Securities** | <br>**Unfunded**<br>**Retirement**<br>**Obligations** | **Accumulated**<br>**Other**<br>**Comprehensive**<br>**(Loss) Income** |
| **Three Months Ended June 30, 2025** |  |  |  |
| Balance, beginning of period | $(33050) | $360 | $(32690) |
| Other comprehensive income during three months ended June 30, 2025 | 2033 | (17) | 2016 |
| Balance, end of period | $(31017) | $343 | $(30674) |
| **Three Months Ended June 30, 2024** |  |  |  |
| Balance, beginning of period | $(41071) | $365 | $(40706) |
| Other comprehensive loss during three months ended June 30, 2024 | (639) | (16) | (655) |
| Balance, end of period | $(41710) | $349 | $(41361) |

---

---

| | | | |
|:---|:---|:---|:---|
| **(In Thousands)** | | | |
|  | **Unrealized**<br>**(Losses)**<br>**Gains**<br>**on Securities** | <br>**Unfunded**<br>**Retirement**<br>**Obligations** | **Accumulated**<br>**Other**<br>**Comprehensive**<br>**(Loss) Income** |
| **Six Months Ended June 30, 2025** |  |  |  |
| Balance, beginning of period | $(37084) | $323 | $(36761) |
| Other comprehensive income during six months ended June 30, 2025 | 6067 | 20 | 6087 |
| Balance, end of period | $(31017) | $343 | $(30674) |
| **Six Months Ended June 30, 2024** |  |  |  |
| Balance, beginning of period | $(38878) | $441 | $(38437) |
| Other comprehensive loss during six months ended June 30, 2024 | (2832) | (92) | (2924) |
| Balance, end of period | $(41710) | $349 | $(41361) |

---

[**Table of Contents**](#TOC)

4. CASH AND DUE FROM BANKS

Cash and due from banks at June 30, 2025 and December 31, 2024 include the following:

---

| | | |
|:---|:---|:---|
| **(In Thousands)** | **June 30,**  | **December 31,**  |
|  | **2025** | **2024** |
| Cash and cash equivalents | $97269 | $123574 |
| Certificates of deposit | 2350 | 2600 |
| Total cash and due from banks | $99619 | $126174 |

---

Certificates of deposit are issues by U.S. banks with original maturities greater than three months. Each certificate of deposit is fully FDIC-insured. The Corporation maintains cash and cash equivalents with certain financial institutions in excess of the FDIC insurance limit.

5. SECURITIES

Amortized cost and fair value of available-for-sale debt securities at June 30, 2025 and December 31, 2024 are summarized as follows. No allowance for credit losses was recorded at June 30, 2025 and December 31, 2024.

---

| | | | | |
|:---|:---|:---|:---|:---|
| **(In Thousands)** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
|  | <br>**Amortized**<br>**Cost** | **Gross**<br>**Unrealized**<br>**Holding**<br>**Gains** | **Gross**<br>**Unrealized**<br>**Holding**<br>**Losses** | <br>**Fair**<br>**Value** |
| Obligations of the U.S. Treasury | $8057 | $0 | $(683) | $7374 |
| Obligations of U.S. Government agencies | 9790 | 0  | (794) | 8996 |
| Bank holding company debt securities | 28961 | 0  | (3194) | 25767 |
| Obligations of states and political subdivisions: |  |  |  |  |
| &nbsp;&nbsp;Tax-exempt | 109330 | 218 | (11588) | 97960 |
| &nbsp;&nbsp;Taxable | 50499 | 0  | (7281) | 43218 |
| Mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored agencies: |  |  |  |  |
| &nbsp;&nbsp;Residential pass-through securities | 100257 | 158  | (6885) | 93530 |
| &nbsp;&nbsp;Residential collateralized mortgage obligations | 53465 | 271  | (2607) | 51129 |
| &nbsp;&nbsp;Commercial mortgage-backed securities | 74380 | 5  | (7377) | 67008 |
| Private label commercial mortgage-backed securities | 5578 | 6  | (4) | 5580 |
| Asset-backed securities, |  |  |  |  |
| &nbsp;&nbsp;Collateralized loan obligations | 5500 | 0  | (10) | 5490 |
| Total available-for-sale debt securities | $445817 | $658 | $(40423) | $406052 |

---

[**Table of Contents**](#TOC)

---

| | | | | |
|:---|:---|:---|:---|:---|
| **(In Thousands)** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | <br>**Amortized**<br>**Cost** | **Gross**<br>**Unrealized**<br>**Holding**<br>**Gains** | **Gross**<br>**Unrealized**<br>**Holding**<br>**Losses** | <br>**Fair**<br>**Value** |
| Obligations of the U.S. Treasury | $8067 | $0 | $(949) | $7118 |
| Obligations of U.S. Government agencies | 10154 | 0  | (1129) | 9025 |
| Bank holding company debt securities | 28958 | 0  | (3712) | 25246 |
| Obligations of states and political subdivisions: |  |  |  |  |
| &nbsp;&nbsp;Tax-exempt | 111995 | 238 | (10931) | 101302 |
| &nbsp;&nbsp;Taxable | 51147 | 0  | (8641) | 42506 |
| Mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored agencies: |  |  |  |  |
| &nbsp;&nbsp;Residential pass-through securities | 104378 | 6  | (9970) | 94414 |
| &nbsp;&nbsp;Residential collateralized mortgage obligations | 53389 | 10  | (3505) | 49894 |
| &nbsp;&nbsp;Commercial mortgage-backed securities | 73470 | 0  | (8969) | 64501 |
| Private label commercial mortgage-backed securities | 8365 | 9  | 0  | 8374 |
| Total available-for-sale debt securities | $449923 | $263 | $(47806) | $402380 |

---

The following table presents gross unrealized losses and fair value of available-for-sale debt securities with unrealized loss positions aggregated by length of time that individual securities have been in a continuous unrealized loss position at June 30, 2025 and December 31, 2024 for which an allowance for credit losses has not been recorded:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **June 30, 2025** | **Less Than 12 Months** | **Less Than 12 Months** | **12 Months or More** | **12 Months or More** | **Total** | **Total** |
| **(In Thousands)** | | | | | | |
|  | **Fair**<br>**Value** | **Unrealized**<br>**Losses** | **Fair**<br>**Value** | **Unrealized**<br>**Losses** | **Fair**<br>**Value** | **Unrealized**<br>**Losses** |
| Obligations of the U.S. Treasury | $0  | $0  | $7374 | (683) | $7374 | $(683) |
| Obligations of U.S. Government agencies | 0  | 0  | 8996 | (794) | 8996 | (794) |
| Bank holding company debt securities | 0  | 0  | 25767 | (3194) | 25767 | (3194) |
| Obligations of states and political subdivisions: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Tax-exempt | 4436 | (100) | 87988 | (11488) | 92424 | (11588) |
| &nbsp;&nbsp;&nbsp;&nbsp;Taxable | 0  | 0  | 43158 | (7281) | 43158 | (7281) |
| Mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored agencies: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Residential pass-through securities | 12450 | (101) | 61668 | (6784) | 74118 | (6885) |
| &nbsp;&nbsp;&nbsp;&nbsp;Residential collateralized mortgage obligations | 6312 | (39) | 25058 | (2568) | 31370 | (2607) |
| &nbsp;&nbsp;&nbsp;&nbsp;Commercial mortgage-backed securities | 0 | 0  | 64647 | (7377) | 64647 | (7377) |
| Private label commercial mortgage-backed securities | 3447 | (4) | 0 | 0 | 3447 | (4) |
| Asset-backed securities, |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Collateralized loan obligations | 2490 | (10) | 0 | 0 | 2490 | (10) |
| Total | $29135 | $(254) | $324656 | $(40169) | $353791 | $(40423) |

---

[**Table of Contents**](#TOC)

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **December 31, 2024** | **Less Than 12 Months** | **Less Than 12 Months** | **12 Months or More** | **12 Months or More** | **Total** | **Total** |
| **(In Thousands)** | | | | | | |
|  | **Fair**<br>**Value** | **Unrealized**<br>**Losses** | **Fair**<br>**Value** | **Unrealized**<br>**Losses** | **Fair**<br>**Value** | **Unrealized**<br>**Losses** |
| Obligations of the U.S. Treasury | $0  | $0  | $7118 | (949) | $7118 | $(949) |
| Obligations of U.S. Government agencies | 0  | 0  | 9025 | (1129) | 9025 | (1129) |
| Bank holding company debt securities | 0  | 0  | 25246 | (3712) | 25246 | (3712) |
| Obligations of states and political subdivisions: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Tax-exempt | 6581 | (58) | 91316 | (10873) | 97897 | (10931) |
| &nbsp;&nbsp;&nbsp;&nbsp;Taxable | 0  | 0  | 42506 | (8641) | 42506 | (8641) |
| Mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored agencies: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Residential pass-through securities | 22777 | (375) | 69282 | (9595) | 92059 | (9970) |
| &nbsp;&nbsp;&nbsp;&nbsp;Residential collateralized mortgage obligations | 19586 | (156) | 27157 | (3349) | 46743 | (3505) |
| &nbsp;&nbsp;&nbsp;&nbsp;Commercial mortgage-backed securities | 2314 | (38) | 62187 | (8931) | 64501 | (8969) |
| Total | $51258 | $(627) | $333837 | $(47179) | $385095 | $(47806) |

---

As reflected in the table above, gross unrealized holding losses on available-for-sale debt securities totaled $40,423,000 at June 30, 2025 and $47,806,000 at December 31, 2024. At June 30, 2025, the Corporation did not have the intent to sell, nor is it more likely than not it will be required to sell, these securities before it is able to recover the amortized cost basis. The unrealized holding losses were consistent with increases in market interest rates that have occurred subsequent to the purchase of most of the securities.

At June 30, 2025 and December 31, 2024, management performed an assessment for possible credit losses of the Corporation's debt securities on an issue-by-issue basis, relying on information obtained from various sources, including publicly available financial data, ratings by external agencies, brokers and other sources. At June 30, 2025 and December 31, 2024, all of the Corporation's holdings of bank holding company debt securities, obligations of states and political subdivisions, private label commercial mortgage-backed securities and collateralized loan obligations were investment grade and there have been no payment defaults.

Based on the results of the assessment, there was no ACL required on available-for-sale debt securities in an unrealized loss position at June 30, 2025 and December 31, 2024.

There were no gross realized gains and losses from the sale of available-for-sale debt securities for the three and six months ended June 30, 2025 and 2024.

The amortized cost and fair value of available-for-sale debt securities by contractual maturity are shown in the following table as of June 30, 2025. Actual maturities may differ from contractual maturities because counterparties may have the right to call or prepay obligations with or without call or prepayment penalties

[**Table of Contents**](#TOC)

---

| | | |
|:---|:---|:---|
| **(In Thousands)** | **June 30, 2025** | **June 30, 2025** |
|  | **Amortized**<br>**Cost** | **Fair**<br>**Value** |
| Due in one year or less | $4740 | $4712 |
| Due from one year through five years | 34733 | 32898 |
| Due from five years through ten years | 80493 | 73131 |
| Due after ten years | 86671 | 72574 |
| Sub-total | 206637 | 183315 |
| Mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored agencies: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Residential pass-through securities | 100257 | 93530 |
| &nbsp;&nbsp;&nbsp;&nbsp;Residential collateralized mortgage obligations | 53465 | 51129 |
| &nbsp;&nbsp;&nbsp;&nbsp;Commercial mortgage-backed securities | 74380 | 67008 |
| Private label commercial mortgage-backed securities | 5578 | 5580 |
| Asset-backed securities, |  |  |
| Collateralized loan obligations | 5500 | 5490 |
| Total | $445817 | $406052 |

---

The Corporation's mortgage-backed securities, collateralized mortgage obligations and asset-backed securities have stated maturities that may differ from actual maturities due to borrowers' ability to prepay obligations. Cash flows from such investments are dependent upon the performance of the underlying mortgage loans and are generally influenced by the level of interest rates. In the table above, mortgage-backed securities, collateralized mortgage obligations and asset-backed securities are shown in one period.

Investment securities carried at $162,406,000 at June 30, 2025 and $190,949,000 at December 31, 2024 were pledged as collateral for public deposits, trusts and certain other deposits as provided by law. See Note 8 for information concerning securities pledged to secure borrowing arrangements.

#### Equity Securities
C&N Bank is a member of the Federal Home Loan Bank of Pittsburgh (FHLB-Pittsburgh), which is one of 11 regional Federal Home Loan Banks. As a member, C&N Bank is required to purchase and maintain stock in FHLB-Pittsburgh. There is no active market for FHLB-Pittsburgh stock, and it must ordinarily be redeemed by FHLB-Pittsburgh in order to be liquidated. C&N Bank's investment in FHLB-Pittsburgh stock, included in other assets in the consolidated balance sheets, was $14,392,000 at June 30, 2025 and $15,018,000 at December 31, 2024. The Corporation evaluated its holding of FHLB-Pittsburgh stock for impairment and deemed the stock to not be impaired at June 30, 2025 and December 31, 2024. In making this determination, management concluded that recovery of total outstanding par value, which equals the carrying value, is expected. The decision was based on review of financial information that FHLB-Pittsburgh has made publicly available.

C&N Bank is a member of the Federal Reserve System. As a member, C&N Bank is required to purchase and maintain stock in the Federal Reserve Bank of Philadelphia. There is no active market for Federal Reserve Bank stock, and it must ordinarily be redeemed by the Federal Reserve Bank of Philadelphia in order to be liquidated. C&N Bank's investment in Federal Reserve Bank stock, included in other assets in the consolidated balance sheets, was $6,321,000 at June 30, 2025 and $6,299,000 at December 31, 2024.

The Corporation has a marketable equity security included in other assets in the consolidated balance sheets with a carrying value of $878,000 at June 30, 2025 and $863,000 December 31, 2024, consisting exclusively of one mutual fund. There was an unrealized loss on the mutual fund of $122,000 at June 30, 2025 and $137,000 at December 31, 2024. Changes in the unrealized gains or losses on this security, which are included in other noninterest income in the consolidated statements of income, were a gain of $2,000 in the second quarter of 2025 and a loss of $9,000 in the second quarter of 2024, a gain of $15,000 in the six-month period ended June 30, 2025 and a loss of $13,000 in the six-month period ended June 30, 2024.

[**Table of Contents**](#TOC)

#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
6. LOANS AND ALLOWANCE FOR CREDIT LOSSES

Loans receivable at June 30, 2025 and December 31, 2024 are summarized as follows:

#### Summary of Loans by Type

#### (In Thousands)

---

| | | |
|:---|:---|:---|
|  | **June 30,** <br>**2025** | **December 31,** <br>**2024** |
| Commercial real estate - non-owner occupied | $757961 | $739565 |
| Commercial real estate - owner occupied | 261157 | 261071 |
| All other commercial loans | 430499 | 423277 |
| Residential mortgage loans | 398496 | 408009 |
| Consumer loans | 71145 | 63926 |
| Total | 1919258 | 1895848 |
| Less: allowance for credit losses on loans | (21699) | (20035) |
| Loans, net | $1897559 | $1875813 |

---

In the table above, outstanding loan balances are presented net of deferred loan origination fees, net, of $3,963,000 at June 30, 2025 and $4,136,000 at December 31, 2024.

The Corporation grants loans to individuals as well as commercial and tax-exempt entities. Commercial, residential and personal loans are made to customers geographically concentrated in Northcentral Pennsylvania, the Southern tier of New York State, Southeastern Pennsylvania and Southcentral Pennsylvania. Although the Corporation has a diversified loan portfolio, a significant portion of its debtors' ability to honor their contracts is dependent on the local economic conditions within the region.

The following tables present an analysis of past due loans as of June 30, 2025 and December 31, 2024:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **(In Thousands)** | **As of June 30, 2025** | **As of June 30, 2025** | **As of June 30, 2025** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **Past Due**<br>**30-89**<br>**Days** | **Past Due**<br>**90+ Days**<br>**Still Accruing** | <br>**Nonaccrual**<br>**Loans** | <br>**Current**<br>**Loans** | <br>**Total**<br>**Loans** |
| Commercial real estate - non-owner occupied | $0  | $0  | $6634  | $751327 | $757961 |
| Commercial real estate - owner occupied | 0  | 0  | 4801  | 256356 | 261157 |
| All other commercial loans | 428 | 34  | 9761 | 420276 | 430499 |
| Residential mortgage loans | 971 | 0  | 3718 | 393807 | 398496 |
| Consumer loans | 322 | 52 | 276 | 70495 | 71145 |
| Total | $1721 | $86 | $25190 | $1892261 | $1919258 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **(In Thousands)** | **As of December 31, 2024** | **As of December 31, 2024** | **As of December 31, 2024** | **As of December 31, 2024** | **As of December 31, 2024** |
|  | **Past Due**<br>**30-89**<br>**Days** | **Past Due**<br>**90+ Days**<br>**Still Accruing** | <br>**Nonaccrual**<br>**Loans** | <br>**Current**<br>**Loans** | <br>**Total**<br>**Loans** |
| Commercial real estate - non-owner occupied | $266  | $0  | $7370 | $731929 | $739565 |
| Commercial real estate - owner occupied | 0  | 62  | 1725 | 259284 | 261071 |
| All other commercial loans | 296 | 0  | 10006 | 412975 | 423277 |
| Residential mortgage loans | 4934 | 0  | 4310 | 398765 | 408009 |
| Consumer loans | 162 | 57 | 431 | 63276 | 63926 |
| Total | $5658 | $119 | $23842 | $1866229 | $1895848 |

---

The Corporation uses an internal risk rating system. Under the risk rating system, the Corporation classifies problem or potential problem loans as "Special Mention," "Substandard," or "Doubtful" on the basis of currently existing facts, conditions and values. Loans that do not currently expose the Corporation to sufficient risk to warrant classification as Substandard or Doubtful, but possess weaknesses that deserve management's close attention, are deemed to be Special Mention. Substandard loans include those characterized by the distinct possibility that the Corporation will sustain some loss if the deficiencies are not corrected. Loans classified as Doubtful have all the weaknesses inherent in those classified as Substandard with the added characteristic that the weaknesses present make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable. Risk ratings are updated any time that conditions or the situation warrants. Loans not classified are included in the "Pass" rows in the table that follows.

[**Table of Contents**](#TOC)

#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
The following table presents the amortized cost of loans by credit quality indicators by year of origination as of June 30, 2025:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **(In Thousands)** | **Term Loans by Year of Origination** | **Term Loans by Year of Origination** | **Term Loans by Year of Origination** | **Term Loans by Year of Origination** | **Term Loans by Year of Origination** | **Term Loans by Year of Origination** |  |  |
|  | **2025** | **2024** | **2023** | **2022** | **2021** | **Prior** | **Revolving** | **Total** |
| Commercial real estate - non-owner occupied |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Pass | $39728 | $60105 | $108529 | $150836 | $76073 | $276720 | $0  | $711991 |
| &nbsp;&nbsp;Special Mention | 231  | 0  | 1133  | 16077  | 2132  | 8773 | 0  | 28346 |
| &nbsp;&nbsp;Substandard | 0  | 109  | 263  | 9823  | 0  | 7429 | 0  | 17624 |
| &nbsp;&nbsp;Doubtful | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| Total commercial real estate - non-owner occupied | $39959 | $60214 | $109925 | $176736 | $78205 | $292922 | $0  | $757961 |
| &nbsp;&nbsp;Year-to-date gross charge-offs | $0  | $0  | $0  | $0  | $0  | $9  | $0  | $9  |
| Commercial real estate - owner occupied |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Pass | $15683 | $25356 | $31955 | $50639 | $47927 | $77267 | $0  | $248827 |
| &nbsp;&nbsp;Special Mention | 0  | 265  | 381  | 834  | 0  | 2352  | 0  | 3832 |
| &nbsp;&nbsp;Substandard | 0  | 0  | 0  | 0  | 2267 | 6231 | 0  | 8498 |
| &nbsp;&nbsp;Doubtful | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| Total commercial real estate - owner occupied | $15683 | $25621 | $32336 | $51473 | $50194 | $85850 | $0  | $261157 |
| &nbsp;&nbsp;Year-to-date gross charge-offs | $0  | $0  | $0  | $0  | $0  | $0  | $0  | $0  |
| All other commercial loans |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Pass | $37842 | $63915 | $66682 | $39311 | $40439 | $44975 | $113670  | $406834 |
| &nbsp;&nbsp;Special Mention | 30  | 308  | 38  | 132  | 0  | 2710  | 9021  | 12239 |
| &nbsp;&nbsp;Substandard | 0  | 0  | 0  | 3478  | 4896  | 1254 | 1798  | 11426 |
| &nbsp;&nbsp;Doubtful | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| Total all other commercial loans | $37872 | $64223 | $66720 | $42921 | $45335 | $48939 | $124489 | $430499 |
| &nbsp;&nbsp;Year-to-date gross charge-offs | $0  | $0  | $0  | $0  | $333  | $0  | $208  | $541  |
| Residential mortgage loans |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Pass | $14147 | $41141 | $44812 | $77310 | $48054 | $168679 | $0  | $394143 |
| &nbsp;&nbsp;Special Mention | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| &nbsp;&nbsp;Substandard | 0  | 0  | 379  | 0  | 12 | 3962 | 0  | 4353 |
| &nbsp;&nbsp;Doubtful | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| Total residential mortgage loans | $14147 | $41141 | $45191 | $77310 | $48066 | $172641 | $0  | $398496 |
| &nbsp;&nbsp;Year-to-date gross charge-offs | $0  | $0  | $0  | $0  | $0  | $5  | $0  | $5  |
| Consumer loans |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Pass | $1526 | $2758 | $2442 | $2191 | $675 | $1033 | $59943 | $70568 |
| &nbsp;&nbsp;Special Mention | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| &nbsp;&nbsp;Substandard | 0  | 0  | 3  | 2  | 0  | 67 | 505 | 577 |
| &nbsp;&nbsp;Doubtful | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| Total consumer loans | $1526 | $2758 | $2445 | $2193 | $675 | $1100 | $60448 | $71145 |
| &nbsp;&nbsp;Year-to-date gross charge-offs | $0  | $0  | $24  | $38  | $0  | $0  | $82 | $144 |
| Total Loans |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Pass | $108926 | $193275 | $254420 | $320287 | $213168 | $568674 | $173613 | $1832363 |
| &nbsp;&nbsp;Special Mention | 261 | 573  | 1552 | 17043 | 2132  | 13835 | 9021 | 44417  |
| &nbsp;&nbsp;Substandard | 0  | 109 | 645 | 13303 | 7175 | 18943 | 2303 | 42478 |
| &nbsp;&nbsp;Doubtful | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| Total  | $109187 | $193957 | $256617 | $350633 | $222475 | $601452 | $184937 | $1919258 |
| &nbsp;&nbsp;Year-to-date gross charge-offs | $0  | $0  | $24  | $38  | $333  | $14  | 290  | $699 |

---

[**Table of Contents**](#TOC)

The following table presents the amortized cost of loans by credit quality indicators by year of origination as of December 31, 2024:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Term Loans by Year of Origination** | **Term Loans by Year of Origination** | **Term Loans by Year of Origination** | **Term Loans by Year of Origination** | **Term Loans by Year of Origination** | **Term Loans by Year of Origination** |  |  |
| **(In Thousands)** | **2024** | **2023** | **2022** | **2021** | **2020** | **Prior** | **Revolving** | **Total** |
| Commercial real estate - non-owner occupied |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Pass | $59708 | $99900 | $161497 | $78884 | $51851 | $243578 | $0  | $695418 |
| &nbsp;&nbsp;Special Mention | 0  | 0  | 16233 | 1371  | 0  | 8188 | 0  | 25792 |
| &nbsp;&nbsp;Substandard | 116  | 0  | 9928  | 0  | 0  | 8311 | 0  | 18355 |
| &nbsp;&nbsp;Doubtful | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| Total commercial real estate - non-owner occupied | $59824 | $99900 | $187658 | $80255 | $51851 | $260077 | $0  | $739565 |
| &nbsp;&nbsp;Year-to-date gross charge-offs | $0  | $0  | $0  | $0  | $0  | $757  | $0  | $757  |
| Commercial real estate - owner occupied |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Pass | $25552 | $33533 | $52207 | $49410 | $11444 | $76558 | $0  | $248704 |
| &nbsp;&nbsp;Special Mention | 0  | 0  | 0  | 0  | 0  | 961  | 0  | 961 |
| &nbsp;&nbsp;Substandard | 0  | 5125  | 729  | 2367  | 0  | 3185 | 0  | 11406 |
| &nbsp;&nbsp;Doubtful | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| Total commercial real estate - owner occupied | $25552 | $38658 | $52936 | $51777 | $11444 | $80704 | $0  | $261071 |
| &nbsp;&nbsp;Year-to-date gross charge-offs | $0  | $0  | $0  | $0  | $0  | $0  | $0  | $0  |
| All other commercial loans |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Pass | $73812 | $74301 | $44245 | $44367 | $23084 | $30656 | $109121  | $399586 |
| &nbsp;&nbsp;Special Mention | 533  | 0  | 2306  | 2  | 0  | 0  | 2147  | 4988 |
| &nbsp;&nbsp;Substandard | 44  | 0  | 3478  | 5229  | 109  | 1078 | 8765  | 18703 |
| &nbsp;&nbsp;Doubtful | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| Total all other commercial loans | $74389 | $74301 | $50029 | $49598 | $23193 | $31734 | $120033 | $423277 |
| &nbsp;&nbsp;Year-to-date gross charge-offs | $0  | $0  | $427  | $60  | $21  | $122  | $0  | $630  |
| Residential mortgage loans |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Pass | $41450 | $48937 | $80789 | $50108 | $35601 | $146231 | $0  | $403116 |
| &nbsp;&nbsp;Special Mention | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| &nbsp;&nbsp;Substandard | 0  | 380  | 0  | 85  | 82 | 4346 | 0  | 4893 |
| &nbsp;&nbsp;Doubtful | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| Total residential mortgage loans | $41450 | $49317 | $80789 | $50193 | $35683 | $150577 | $0  | $408009 |
| &nbsp;&nbsp;Year-to-date gross charge-offs | $0  | $0  | $0  | $0  | $0  | $0  | $0  | $0  |
| Consumer loans |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Pass | $3859 | $3441 | $2848 | $1013 | $599 | $679 | $50860 | $63299 |
| &nbsp;&nbsp;Special Mention | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| &nbsp;&nbsp;Substandard | 0  | 8  | 4  | 0  | 0  | 71 | 544 | 627 |
| &nbsp;&nbsp;Doubtful | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| Total consumer loans | $3859 | $3449 | $2852 | $1013 | $599 | $750 | $51404 | $63926 |
| &nbsp;&nbsp;Year-to-date gross charge-offs | $0  | $69  | $130  | $7  | $8  | $1  | $114 | $329 |
| Total Loans |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Pass | $204381 | $260112 | $341586 | $223782 | $122579 | $497702 | $159981 | $1810123 |
| &nbsp;&nbsp;Special Mention | 533 | 0  | 18539 | 1373 | 0  | 9149 | 2147 | 31741  |
| &nbsp;&nbsp;Substandard | 160 | 5513 | 14139 | 7681 | 191 | 16991 | 9309 | 53984 |
| &nbsp;&nbsp;Doubtful | 0  | 0  | 0  | 0  | 0  | 0  | 0  | 0  |
| Total  | $205074 | $265625 | $374264 | $232836 | $122770 | $523842 | $171437 | $1895848 |
| &nbsp;&nbsp;Year-to-date gross charge-offs | $0  | $69  | $557  | $67  | $29  | $880  | 114  | $1716 |

---

[**Table of Contents**](#TOC)

The following tables are a summary of the Corporation's nonaccrual loans by major categories for the periods indicated.

---

| | | | |
|:---|:---|:---|:---|
|  | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
| **(In Thousands)** | **Nonaccrual Loans with**<br>**No Allowance** | **Nonaccrual Loans**<br>**with an Allowance** | **Total Nonaccrual**<br>**Loans** |
| Commercial real estate - non-owner occupied | $6634 | $0  | $6634 |
| Commercial real estate - owner occupied | 4562 | 239 | 4801 |
| All other commercial loans | 9761 | 0  | 9761 |
| Residential mortgage loans | 3718 | 0  | 3718 |
| Consumer loans | 276 | 0  | 276 |
| Total | $24951 | $239 | $25190 |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| **(In Thousands)** | **Nonaccrual Loans with**<br>**No Allowance** | **Nonaccrual Loans**<br>**with an Allowance** | **Total Nonaccrual**<br>**Loans** |
| Commercial real estate - non-owner occupied | $7370 | $0  | $7370 |
| Commercial real estate - owner occupied | 1467 | 258 | 1725 |
| All other commercial loans | 10006 | 0  | 10006 |
| Residential mortgage loans | 4310 | 0  | 4310 |
| Consumer loans | 431 | 0  | 431 |
| Total | $23584 | $258 | $23842 |

---

The Corporation recognized interest income on nonaccrual loans of $227,000 and $457,000 in the three and six months ended June 30, 2025, respectively and $285,000 and $516,000 in the three and six months ended June 30, 2024, respectively.

The following table represents the accrued interest receivable written off by reversing interest income during the three-month and six-month periods ended June 30, 2025 and 2024:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **(In Thousands)** | **Three Months Ended** <br>**June 30, 2025** | **Three Months Ended** <br>**June 30, 2024** | **Six Months Ended** <br>**June 30, 2025** | **Six Months Ended** <br>**June 30, 2024** |
| Commercial real estate - non-owner occupied | $0  | $7  | $0  | $19 |
| Commercial real estate - owner occupied | 51  | 10  | 51  | 10  |
| All other commercial loans | 0  | 2  | 0  | 118  |
| Residential mortgage loans | 3  | 5 | 8 | 18 |
| Consumer loans | 0  | 2  | 0  | 4 |
| Total | $54 | $26 | $59 | $169 |

---

The Corporation has certain loans for which repayment is dependent upon the operation or sale of collateral, as the borrower is experiencing financial difficulty. The underlying collateral can vary based upon the type of loan. The following provides more detail about the types of collateral that secure collateral dependent loans:

● Commercial real estate loans can be secured by either owner occupied commercial real estate or non-owner occupied investment commercial real estate. Typically, owner occupied commercial real estate loans are secured by office buildings, warehouses, manufacturing facilities and other commercial and industrial properties occupied by operating companies. Non-owner occupied commercial real estate loans are generally secured by office buildings and complexes, retail facilities, multifamily complexes, land under development, industrial properties, as well as other commercial or industrial real estate.

● All other commercial loans include loans typically secured by business assets including inventory, equipment and receivables. This category also included commercial construction and land loans and some commercial lines of credit that are secured by real estate.

● Residential mortgage loans are typically secured by first mortgages, and, in some cases, could be secured by a second mortgage.

[**Table of Contents**](#TOC)

● Consumer loans are generally secured by automobiles, motorcycles, recreational vehicles and other personal property. Some consumer loans are unsecured and have no underlying collateral.

The following table details the amortized cost of collateral dependent loans, which are individually evaluated to determine expected credit losses, and the related allowance for credit losses allocated to these loans:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **June 30, 2025** | **June 30, 2025** | **December 31, 2024** | **December 31, 2024** |
| **(In Thousands)** | **Amortized**<br>**Cost** | <br>**Allowance** | **Amortized**<br>**Cost** | <br>**Allowance** |
| Commercial real estate - non-owner occupied | $6634 | $0  | $7370 | $0  |
| Commercial real estate - owner occupied | 4801 | 9 | 6749 | 122 |
| All other commercial loans | 9761  | 0  | 16006  | 0  |
| Total | $21196 | $9 | $30125 | $122 |

---

**Allowance for Credit Losses**

The allowance for credit losses ("ACL") on loans represents management's estimate of lifetime credit losses inherent in loans as of the consolidated balance sheet date. The ACL on loans includes two primary components: (i) an allowance established on loans which share similar risk characteristics which are collectively evaluated for credit losses, and (ii) an allowance established on loans which do not share similar risk characteristics with any loan segment and which are individually evaluated for credit losses.

Management determines the ACL on loans that are collectively evaluated by considering the following: (a) the weighted-average remaining maturity (WARM) method is used to estimate credit losses, based on the Corporation's historical loss experience, for pools of loans with similar risk and cash flow characteristics; (b) subjective adjustments are made, generally increasing the ACL, for qualitative risk factors that are deemed likely to cause estimated credit losses to differ from historical experience; and (c) an additional adjustment to expected credit losses is made, based on an economic forecast, and applied for the first 2 years of the weighted-average remaining life of the portfolio.

The following table summarizes the activity related to the allowance for credit losses for the three and six months ended June 30, 2025 and 2024.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **(In Thousands)** | **Commercial**<br>**real estate -**<br>**nonowner**<br>**occupied** | **Commercial**<br>**real estate -**<br>**owner**<br>**occupied** | **All**<br>**other**<br>**commercial**<br>**loans** | <br>**Residential**<br>**mortgage**<br>**loans** | <br>**Consumer**<br>**loans** | <br>**Total** |
| Balance, March 31, 2025 | $12060 | $2769 | $3594 | $1281 | $468 | $20172 |
| Charge-offs | (9) | 0  | (541) | (5) | (27) | (582) |
| Recoveries | 0  | 0  | 1  | 1  | 32 | 34 |
| Provision (credit) for credit losses on loans | 1042 | 286 | 837 | 37 | (127) | 2075 |
| Balance, June 30, 2025 | $13093 | $3055 | $3891 | $1314 | $346 | $21699 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **(In Thousands)** | **Commercial**<br>**real estate -**<br>**nonowner**<br>**occupied** | **Commercial**<br>**real estate -**<br>**owner**<br>**occupied** | **All**<br>**other**<br>**commercial**<br>**loans** | <br>**Residential**<br>**mortgage**<br>**loans** | <br>**Consumer**<br>**loans** | <br>**Total** |
| Balance, December 31, 2024 | $11964 | $2844 | $3361 | $1356 | $510 | $20035 |
| Charge-offs | (9) | 0  | (541) | (5) | (144) | (699) |
| Recoveries | 0  | 0  | 2  | 2  | 56 | 60 |
| Provision (credit) for credit losses on loans | 1138 | 211 | 1069 | (39) | (76) | 2303 |
| Balance, June 30, 2025 | $13093 | $3055 | $3891 | $1314 | $346 | $21699 |

---

[**Table of Contents**](#TOC)

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **(In Thousands)** | **Commercial**<br>**real estate -**<br>**nonowner**<br>**occupied** | **Commercial**<br>**real estate -**<br>**owner**<br>**occupied** | **All**<br>**other**<br>**commercial**<br>**loans** | <br>**Residential**<br>**mortgage**<br>**loans** | <br>**Consumer**<br>**loans** | <br>**Total** |
| Balance, March 31, 2024 | $12533 | $2718 | $3580 | $769 | $423 | $20023 |
| Charge-offs | (117) | 0  | 0  | 0  | (119) | (236) |
| Recoveries | 0  | 0  | 15  | 0  | 14 | 29 |
| Provision (credit) for credit losses on loans | (239) | 183 | 83 | 343 | 196 | 566 |
| Balance, June 30, 2024 | $12177 | $2901 | $3678 | $1112 | $514 | $20382 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **(In Thousands)** | **Commercial**<br>**real estate -**<br>**nonowner**<br>**occupied** | **Commercial**<br>**real estate -**<br>**owner**<br>**occupied** | **All**<br>**other**<br>**commercial**<br>**loans** | <br>**Residential**<br>**mortgage**<br>**loans** | <br>**Consumer**<br>**loans** | <br>**Total** |
| Balance, December 31, 2023 | $12010 | $2116 | $2918 | $1764 | $400 | $19208 |
| Charge-offs | (117) | 0  | (60) | 0  | (239) | (416) |
| Recoveries | 0  | 0  | 35  | 3 | 26 | 64 |
| Provision (credit) for credit losses on loans | 284 | 785 | 785 | (655) | 327 | 1526 |
| Balance, June 30, 2024 | $12177 | $2901 | $3678 | $1112 | $514 | $20382 |

---

The ACL on loans individually evaluated decreased to $9,000 at June 30, 2025 from $122,000 at December 31, 2024. At June 30, 2025, there were loans to one borrower with a total amortized cost basis of $239,000 for which an individual ACL was recorded. At December 31, 2024, there were loans to one borrower with a total amortized cost basis of $258,000 for which an individual ACL was recorded.

The ACL on loans collectively evaluated was $21,690,000 at June 30, 2025, up from $19,913,000 at December 31, 2024. The increase in the collectively evaluated portion of the ACL at June 30, 2025 as compared to December 31, 2024 included a net increase related to changes in qualitative adjustments and in an economic forecast, partially offset by a decrease in the portion of the ACL based on the WARM method estimated losses resulting partially from a reduction in the estimated average life of the portfolio.

**Modifications Made to Borrowers Experiencing Financial Difficulty**

The Corporation closely monitors the performance of the loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. Because the effect of most modifications made to borrowers experiencing financial difficulty is already included in the allowance for credit losses because of the measurement methodologies used to estimate the allowance, a change to the allowance for credit losses is generally not recorded upon modification. During the three and six months ended June 30, 2025 and June 30, 2024, the Corporation made no modifications of loans to borrowers experiencing financial difficulty.

The following table presents the performance of such loans that have been modified in the twelve-month period preceding June 30, 2025 and the twelve-month period preceding June 30, 2024 (in thousands):

---

| | | | |
|:---|:---|:---|:---|
| **(In Thousands)** | **Payment Status (Amortized Cost Basis)** | **Payment Status (Amortized Cost Basis)** | **Payment Status (Amortized Cost Basis)** |
| **June 30, 2025** | **Current or Past Due Less than 30 Days** | **90+ Days Past Due** | **Total** |
| Commercial real estate - non-owner occupied | $2585 | $0 | $2585 |
| Commercial real estate - owner occupied | 217 | 0 | 217 |
| Total | $2802 | $0 | $2802 |

---

---

| | | | |
|:---|:---|:---|:---|
| **(In Thousands)** | **Payment Status (Amortized Cost Basis)** | **Payment Status (Amortized Cost Basis)** | **Payment Status (Amortized Cost Basis)** |
| **June 30, 2024** | **Current or Past Due Less than 30 Days** | **90+ Days Past Due** | **Total** |
| Commercial real estate - non-owner occupied | $2504 | $1381 | $3885 |

---

[**Table of Contents**](#TOC)

Included in performance of loans modified in the twelve-month period preceding June 30, 2025 table above, was one loan secured by non-owner occupied commercial real estate with an amortized cost basis of $1,790,000 that was in nonaccrual status at June 30, 2025.

For the loan secured by non-owner occupied real estate with an amortized cost basis of $1,790,000 at June 30, 2025, the Corporation had extended the maturity for 12 months in the fourth quarter 2023. In 2024, the borrower continued to experience financial difficulty, and the Corporation provided another six-month extension of the maturity. The Corporation recorded a partial charge-off of $640,000 on this loan in 2024. There was no specific ACL on this loan at June 30, 2025 and December 31, 2024.

The loan that was past due more than 90 days at June 30, 2024 in the table above was in default with its modified terms at June 30, 2024. The Corporation received payments totaling $258,000 in the twelve-month period ended June 30, 2025, all of which were applied to principal. The amortized cost basis of the loan was $1,123,000 at June 30, 2025.

The Corporation had no commitments to lend any additional funds on modified loans during the three and six months ended June 30, 2025 and 2024, and the Corporation had no loans that defaulted during the three and six months ended June 30, 2025 and 2024 that had been modified preceding the payment default when the borrower was experiencing financial difficulty at the time of modification.

The carrying amount of foreclosed residential real estate properties held as a result of obtaining physical possession (included in foreclosed assets held for sale in the unaudited consolidated balance sheets) is as follows:

---

| | | |
|:---|:---|:---|
| **(In Thousands)** | **June 30,**  | **December 31,**  |
|  | **2025** | **2024** |
| Foreclosed residential real estate | $246 | $25  |

---

The amortized cost of consumer mortgage loans secured by residential real properties for which formal foreclosure proceedings were in process is as follows:

---

| | | |
|:---|:---|:---|
| **(In Thousands)** | **June 30,**  | **December 31,**  |
|  | **2025** | **2024** |
| Residential real estate in process of foreclosure | $445 | $717 |

---

The Corporation is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financial needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. The contract amounts of these financial instruments at June 30, 2025 and December 31, 2024 are as follows:

---

| | | |
|:---|:---|:---|
| <br>**(In Thousands)** | **June 30,** <br>**2025** | **December 31,**<br>**2024** |
| Commitments to extend credit | $408779 | $380003 |
| Standby letters of credit | 65258 | 64586 |

---

The Corporation maintains an allowance for off-balance sheet credit exposures such as unfunded balances for existing lines of credit, commitments to extend future credit, commercial letters of credit and credit enhancement obligations related to residential mortgage loans sold with recourse, when there is a contractual obligation to extend credit and when this extension of credit is not unconditionally cancellable (i.e. commitment cannot be canceled at any time). The allowance for off-balance sheet credit exposures is adjusted through the provision for credit losses. The estimate includes consideration of the likelihood that funding will occur and an estimate of expected credit losses on commitments expected to be funded over their estimated lives. The allowance for credit losses for off-balance sheet exposures of $742,000 at June 30, 2025 and $455,000 at December 31, 2024, is included in accrued interest and other liabilities on the unaudited consolidated balance sheets.

The following table presents the balance and activity in the allowance for credit losses for off-balance sheet exposures for the three and six months ended June 30, 2025 and 2024:

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---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended**  | **Three Months Ended**  | **Six Months Ended**  | **Six Months Ended**  |
| **(In Thousands)** | **June 30, 2025** | **June 30, 2024** | **June 30, 2025** | **June 30, 2024** |
| Beginning Balance | $463 | $684 | $455 | $690 |
| Provision (credit) for unfunded commitments | 279 | (1) | 287 | (7) |
| Ending Balance, June 30 | $742 | $683 | $742 | $683 |

---

7. GOODWILL AND CORE DEPOSIT INTANGIBLES, NET

Goodwill represents the excess of the cost of acquisitions over the fair value of the net assets acquired. At June 30, 2025 and December 31, 2024, the net carrying value of goodwill was $52,505,000.

Information related to core deposit intangibles is as follows:

---

| | | |
|:---|:---|:---|
| **(In Thousands)** | **June 30,**  | **December 31,**  |
|  | **2025** | **2024** |
| Gross amount | $6639 | $6639 |
| Accumulated amortization | (4771) | (4559) |
| Net | $1868 | $2080 |

---

Amortization expense related to core deposit intangibles is included in other noninterest expense in the consolidated statements of income, as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **(In Thousands)** | **Three Months Ended**  | **Three Months Ended**  | **Six Months Ended**  | **Six Months Ended**  |
|  | **June 30,**  | **June 30,**  | **June 30,**  | **June 30,**  |
|  | **2025** | **2024** | **2025** | **2024** |
| Amortization expense | $106 | $98 | $212 | $195 |

---

8. BORROWED FUNDS

**SHORT-TERM BORROWINGS**

Short-term borrowings (initial maturity within one year) include the following:

---

| | | |
|:---|:---|:---|
| **(In Thousands)** | **June 30,**  | **December 31,**  |
|  | **2025** | **2024** |
| FHLB-Pittsburgh borrowings | $0  | $0  |
| Customer repurchase agreements | 533 | 2488 |
| Total short-term borrowings | $533 | $2488 |

---

The Corporation engages in repurchase agreements with certain commercial customers. These agreements provide that the Corporation sells specified investment securities to the customers on an overnight basis and repurchases them on the following business day. The weighted average rate paid by the Corporation on customer repurchase agreements was 0.10% at both June 30, 2025 and December 31, 2024. The carrying value of the underlying securities was $540,000 at June 30, 2025 and $2,500,000 at December 31, 2024.

The FHLB-Pittsburgh loan facility is collateralized by qualifying loans secured by real estate with a book value totaling $1,387,317,000 at June 30, 2025 and $1,351,770,000 at December 31, 2024. Also, the FHLB-Pittsburgh loan facility requires the Corporation to invest in established amounts of FHLB-Pittsburgh stock. The carrying values of the Corporation's holdings of FHLB-Pittsburgh stock (included in other assets in the consolidated balance sheets) were $14,392,000 at June 30, 2025 and $15,018,000 at December 31, 2024. The Corporation's total credit facility with FHLB-Pittsburgh was $945,619,000 at June 30, 2025, including an unused (available) amount of $780,008,000 and outstanding credit facilities of $165,611,000 which included long-term borrowings with par values totaling $143,894,000 and letters of credit totaling $21,717,000. At December 31, 2024, the Corporation's total credit facility with FHLB-

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Pittsburgh was $938,691,000, including an unused (available) amount of $749,999,000 and outstanding credit facilities of $188,692,000 which included long-term borrowings with par values totaling $165,451,000 and letters of credit totaling $23,241,000.

The Corporation had available credit with other correspondent banks totaling $75,000,000 at June 30, 2025 and December 31, 2024. These lines of credit are primarily unsecured. No amounts were outstanding at June 30, 2025 or December 31, 2024.

The Corporation has a line of credit with the Federal Reserve Bank of Philadelphia's Discount Window. At June 30, 2025, the Corporation had available credit in the amount of $17,545,000 on this line with no outstanding advances. At December 31, 2024, the Corporation had available credit in the amount of $18,093,000 on this line with no outstanding advances. As collateral for this line, the Corporation has pledged available-for-sale securities with a carrying value of $18,305,000 at June 30, 2025 and $18,881,000 at December 31, 2024.

#### LONG-TERM BORROWINGS – FHLB ADVANCES
Long-term borrowings from FHLB-Pittsburgh are as follows:

---

| | | |
|:---|:---|:---|
| **(In Thousands)** | **June 30,**  | **December 31,**  |
|  | **2025** | **2024** |
| Loans maturing in 2025 with a weighted-average rate of 4.30% | 22959 | 44516 |
| Loans maturing in 2026 with a weighted-average rate of 4.61% | 48018 | 48018 |
| Loans maturing in 2027 with a weighted-average rate of 4.24% | 34571 | 34571 |
| Loans maturing in 2028 with a weighted-average rate of 4.30% | 26027 | 26027 |
| Loans maturing in 2029 with a weighted-average rate of 4.42% | 12319 | 12319 |
| Total long-term FHLB-Pittsburgh borrowings | $143894 | $165451 |

---

Note: Weighted-average rates are presented as of June 30, 2025.

**SENIOR NOTES**

In 2021, the Corporation issued and sold $15.0 million in aggregate principal amount of 2.75% Fixed Rate Senior Unsecured Notes due 2026 (the "Senior Notes"). The Senior Notes mature on June 1, 2026 and bear interest at a fixed annual rate of 2.75%. The Corporation is not entitled to redeem the Senior Notes, in whole or in part, at any time prior to maturity and the Senior Notes are not subject to redemption by the holders. The Senior Notes are unsecured and unsubordinated obligations of the Corporation only and are not obligations of, and are not guaranteed by, any subsidiary of the Corporation.

The Senior Notes were recorded, net of debt issuance costs of $337,000, at an initial carrying amount of $14,663,000. Debt issuance costs are amortized over the term of the Senior Notes as an adjustment of the effective interest rate. Amortization of debt issuance costs associated with the Senior Notes totaling $17,000 in the second quarter 2025 and $35,000 for the six-month ended June 30, 2025 and $17,000 in the second quarter 2024 and $34,000 for the six-month ended June 30, 2024 was included in interest expense on senior notes, net in the unaudited consolidated statements of income.

At June 30, 2025 and December 31, 2024, outstanding Senior Notes are as follows:

---

| | | |
|:---|:---|:---|
| **(In Thousands)** | **June 30,**  | **December 31,**  |
|  | **2025** | **2024** |
| Senior Notes with an aggregate par value of $15,000,000; bearing interest at 2.75% with an effective interest rate of 3.23%; maturing in June 2026 | $14934  | $14899  |
| Total carrying value | $14934 | $14899 |

---

**SUBORDINATED DEBT**

In 2021, the Corporation issued and sold $25.0 million in aggregate principal amount of 3.25% Fixed-to-Floating Rate Subordinated Notes due 2031 (the "Subordinated Notes"). The Subordinated Notes mature on June 1, 2031 and bear interest at a fixed annual rate of 3.25%, to June 1, 2026. From June 1, 2026 to maturity or early redemption, the interest rate will reset quarterly to an interest rate per

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
annum equal to the three-month Secured Overnight Financing Rate provided by the Federal Reserve Bank of New York plus 259 basis points. The Corporation is entitled to redeem the Subordinated Notes, in whole or in part, at any time on or after June 1, 2026, and to redeem the Subordinated Notes at any time in whole upon certain other events. Any redemption of the Subordinated Notes will be subject to prior regulatory approval to the extent required.

The Subordinated Notes are not subject to redemption at the option of the holders. The Subordinated Notes are unsecured, subordinated obligations of the Corporation only and are not obligations of, and are not guaranteed by, any subsidiary of the Corporation. The Subordinated Notes rank junior in right to payment to the Corporation's current and future senior indebtedness, including the Senior Notes (described above). The Subordinated Notes are intended to qualify as Tier 2 capital for regulatory capital purposes.

The Subordinated Notes were recorded, net of debt issuance costs of $563,000, at an initial carrying amount of $24,437,000. Debt issuance costs are amortized through June 1, 2026 as an adjustment of the effective interest rate. Amortization of debt issuance costs associated with the Subordinated Notes totaling $29,000 in the second quarter 2025 and $58,000 for the six-month period ended June 30, 2025 and $28,000 in the second quarter 2024 and $56,000 for the six-month period ended June 30, 2024, was included in interest expense on subordinated debt, net in the unaudited consolidated statements of income.

At June 30, 2025 and December 31, 2024, the carrying amounts of subordinated debt agreements are as follows:

---

| | | |
|:---|:---|:---|
| **(In Thousands)** | **June 30,**  | **December 31,**  |
|  | **2025** | **2024** |
| Agreements with a par value of $25,000,000; bearing interest at 3.25% with an effective interest rate of 3.74%; maturing in June 2031 and redeemable at par in June 2026 | $24889 | $24831 |
| Total carrying value | $24889 | $24831 |

---

9. STOCK-BASED COMPENSATION PLANS

The Corporation has a stock incentive plan for selected officers and the independent directors. The Corporation made second quarter 2025 restricted stock awards to independent directors that vest ratably over one year and made restricted stock awards to employees that vest ratably over three years in the six-month period ended June 30, 2025. Following is a summary of restricted stock awards granted in the six-month period ended June 30, 2025:

---

| | | |
|:---|:---|:---|
| **(Dollars in Thousands)** | | |
|  | <br>**Number of**<br>**Shares** | **Aggregate**<br>**Grant**<br>**Date**<br>**Fair**<br>**Value** |
| Six Months Ended June 30, 2025 awards: |  |  |
| &nbsp;&nbsp;Time-based awards to independent directors | 12700  | $250  |
| &nbsp;&nbsp;Time-based awards to employees | 31113  | 684  |
| &nbsp;&nbsp;Performance-based awards to employees | 11848  | 261  |
| Total | 55661 | $1195 |

---

Compensation cost related to restricted stock is recognized based on the fair value of the stock at the grant date over the vesting period, adjusted for estimated and actual forfeitures. Total stock-based compensation expense attributable to restricted stock awards amounted to $331,000 in the second quarter 2025 and $390,000 in the second quarter 2024. Total stock-based compensation expense attributable to restricted stock awards amounted to $656,000 in the six-month period ended June 30, 2025 and $716,000 in the six-month period ended June 30, 2024.

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10. CONTINGENCIES

**Class Action Litigation**

On March 27, 2024, a putative class action lawsuit was filed in the US District Court for the Western District of Texas by investors in a purported Ponzi scheme operated by two individuals, one of whom maintained accounts at C&N Bank. The plaintiffs have sued C&N Bank, along with another bank, an additional law firm and accounting firm defendants. The case is styled Goldovsky, et al. v. Rauld, et al. Plaintiffs have asserted claims against C&N Bank and the other bank for aiding and abetting alleged violations of the Texas Securities Act, and additional claims against the legal and accounting professionals for statutory fraud, common law fraud, negligent misrepresentation, and knowing participation in breach of fiduciary duty.

C&N Bank has filed motions to dismiss the case for wont of personal jurisdiction and failure to state a claim. The Plaintiffs have responded to those motions. Plaintiffs have filed an application for certification of the suit as a class action. The court has stayed the motions to dismiss pending consideration of the class action certification application. Following depositions of the four plaintiffs on issues germane to class action certification, C&N Bank and each of the other defendants have filed briefs in opposition to the plaintiffs' class certification motion. A hearing on the motion for class certification took place on February 18, 2025. By order of the District Court judge dated March 27, 2025, C&N Bank's motion to dismiss for wont of personal jurisdiction was granted. The Plaintiffs have no appeal of the District Court's decision as a matter of right. On May 23, 2025, C&N Bank was served with a complaint filed by *Goldovsky, et al* in the US District Court for the Middle District of Pennsylvania. The complaint is predicated upon Texas Securities law alleging substantially the same facts and asserting the same legal arguments.

C&N Bank believes that it has substantial defenses against the action, and it intends to defend itself against the plaintiffs' allegations. Based on the information available to the Corporation, the Corporation does not believe at this time that a loss is probable in this matter, nor can a range of possible losses be determined. Accordingly, no liability has been recorded for this litigation matter in the accompanying consolidated financial statements. The Corporation's estimate may change from time to time, and actual losses could vary.

**Other Matters**

In the normal course of business, the Corporation is subject to pending and threatened litigation in which claims for monetary damages are asserted. In management's opinion, the Corporation's financial position and results of operations would not be materially affected by the outcome of these legal proceedings.

11. DERIVATIVE FINANCIAL INSTRUMENTS

The Corporation is a party to derivative financial instruments. These financial instruments consist of interest rate swap agreements and risk participation agreements (RPAs) which contain master netting and collateral provisions designed to protect the party at risk.

Interest rate swaps with commercial loan banking customers were executed to facilitate their respective risk management strategies. Under the terms of these arrangements, the commercial banking customers effectively exchanged their floating interest rate exposures on loans into fixed interest rate exposures. Those interest rate swaps have been simultaneously economically hedged by offsetting interest rate swaps with a third party, such that the Corporation has effectively exchanged its fixed interest rate exposures for floating rate exposures. These derivatives are not designated as hedges and are not speculative. Rather, these derivatives result from a service provided to certain customers. As the interest rate swaps associated with this program do not meet the hedge accounting requirements, changes in the fair value of both the customer swaps and the offsetting swaps are recognized directly in earnings.

The aggregate notional amount of interest rate swaps was $143,208,000 at June 30, 2025 and $141,940,000 at December 31, 2024. The Corporation originated one interest rate swap with a notional amount of $1,800,000 in the six-month period ended June 30, 2025. Fee income on the interest swap originated in the six-month period ended June 30, 2025 of $24,000 was included in other noninterest income in the consolidated statements of income. There were no interest rate swaps originated in the six-month period ended June 30, 2024. There were no gross amounts of interest rate swap-related assets and liabilities not offset in the consolidated balance sheets at June 30, 2025 and December 31, 2024.

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The Corporation has entered into an RPA with another institution as a means to assume a portion of the credit risk associated with a loan structure which includes a derivative instrument, in exchange for fee income commensurate with the risk assumed. This type of derivative is referred to as an "RPA In." In addition, in an effort to reduce the credit risk associated with an interest rate swap agreement with a borrower for whom the Corporation has provided a loan structured with a derivative, the Corporation purchased an RPA from an institution participating in the facility in exchange for a fee commensurate with the risk shared. This type of derivative is referred to as an "RPA Out." There was an increase of $9,000 included in other noninterest income from RPAs in the second quarter 2025 and in the six-month period ended June 30, 2025 as compared to an increase of $1,000, included in other noninterest income, in the second quarter 2024 and $2,000 in the six-month period ended June 30, 2024.

The table below presents the fair value of the Corporation's derivative financial instruments as well as their classification on the consolidated balance sheets at June 30, 2025 and December 31, 2024:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **(In Thousands)** | **At June 30, 2025** | **At June 30, 2025** | **At June 30, 2025** | **At June 30, 2025** | **At December 31, 2024** | **At December 31, 2024** | **At December 31, 2024** | **At December 31, 2024** |
|  | **Asset Derivatives** | **Asset Derivatives** | **Liability Derivatives** | **Liability Derivatives** | **Asset Derivatives** | **Asset Derivatives** | **Liability Derivatives** | **Liability Derivatives** |
|  | **Notional**<br>**Amount** | **Fair**<br>**Value (1)** | **Notional**<br>**Amount** | **Fair**<br>**Value (2)** | **Notional**<br>**Amount** | **Fair**<br>**Value (1)** | **Notional**<br>**Amount** | **Fair**<br>**Value (2)** |
| Interest rate swap agreements | $71604 | $1664 | $71604 | $1664 | $70970 | $2385 | $70970 | $2385 |
| RPA Out | 6890 | 4  | 0  | 0  | 6957 | 2  | 0  | 0  |
| RPA In | 0  | 0  | 14001 | 9 | 0  | 0  | 9916 | 2 |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) Included in other assets in the consolidated balance sheets.

&nbsp;&nbsp;&nbsp;&nbsp;(2) Included in accrued interest and other liabilities in the consolidated balance sheets.

The Corporation's agreements with its derivative counterparties provide that, if the Corporation defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Corporation could also be declared in default on its derivative obligations. Further, if the Corporation were to fail to maintain its status as a well or adequately capitalized institution, then the counterparties could terminate the derivative positions, and the Corporation would be required to settle its obligations under the agreements. There was interest-bearing cash pledged as collateral against the Corporation's liability related to the interest rate swaps of $1,120,000 at June 30, 2025 and $1,090,000 at December 31, 2024.

12. FAIR VALUE MEASUREMENTS AND FAIR VALUES OF FINANCIAL INSTRUMENTS

The Corporation measures certain assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. FASB Topic 820, "Fair Value Measurements and Disclosures" establishes a framework for measuring fair value that includes a hierarchy used to classify the inputs used in measuring fair value. The hierarchy prioritizes the inputs used in determining valuations into three levels. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement. The levels of the fair value hierarchy are as follows:

Level 1 – Fair value is based on unadjusted quoted prices in active markets that are accessible to the Corporation for identical assets or liabilities. These generally provide the most reliable evidence and are used to measure fair value whenever available.

Level 2 – Fair value is based on significant inputs, other than Level 1 inputs, that are observable either directly or indirectly for substantially the full term of the asset or liability through corroboration with observable market data. Level 2 inputs include quoted market prices in active markets for similar assets or liabilities, quoted market prices in markets that are not active for identical or similar assets or liabilities and other observable inputs.

Level 3 – Fair value is based on significant unobservable inputs. Examples of valuation methodologies that would result in Level 3 classification include option pricing models, discounted cash flows and other similar techniques.

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The Corporation monitors and evaluates available data relating to fair value measurements on an ongoing basis and recognizes transfers among the levels of the fair value hierarchy as of the date of an event or change in circumstances that affects the valuation method chosen. Examples of such changes may include the market for a particular asset or liability becoming active or inactive, changes in the availability of quoted prices, or changes in the availability of other market data.

At June 30, 2025 and December 31, 2024, assets and liabilities measured at fair value and the valuation methods used are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
| **(In Thousands)** | **Quoted Prices**<br>**in Active Markets**<br>**(Level 1)** | **Other Observable**<br>**Inputs**<br>**(Level 2)** | **Unobservable**<br>**Inputs**<br>**(Level 3)** | <br>**Total**<br>**Fair Value** |
| **Recurring fair value measurements, assets:** |  |  |  |  |
| AVAILABLE-FOR-SALE DEBT SECURITIES: |  |  |  |  |
| Obligations of the U.S. Treasury | $7374 | $0  | $0  | $7374 |
| Obligations of U.S. Government agencies | 0  | 8996 | 0  | 8996 |
| Bank holding company debt securities | 0  | 25767 | 0  | 25767 |
| Obligations of states and political subdivisions: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Tax-exempt | 0  | 97960 | 0  | 97960 |
| &nbsp;&nbsp;&nbsp;&nbsp;Taxable | 0  | 43218 | 0  | 43218 |
| Mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored agencies: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Residential pass-through securities | 0  | 93530 | 0  | 93530 |
| &nbsp;&nbsp;&nbsp;&nbsp;Residential collateralized mortgage obligations | 0  | 51129 | 0  | 51129 |
| &nbsp;&nbsp;&nbsp;&nbsp;Commercial mortgage-backed securities | 0  | 67008 | 0  | 67008 |
| Private label commercial mortgage-backed securities | 0  | 5580 | 0  | 5580 |
| Asset-backed securities, |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Collateralized loan obligations | 0  | 5490 | 0  | 5490 |
| Total available-for-sale debt securities | 7374 | 398678 | 0  | 406052 |
| Marketable equity security | 878 | 0  | 0  | 878 |
| Servicing rights | 0  | 0  | 2819 | 2819 |
| RPA Out | 0  | 4  | 0  | 4 |
| Interest rate swap agreements, assets | 0  | 1664  | 0  | 1664 |
| Total recurring fair value measurements, assets | $8252 | $400346 | $2819 | $411417 |
| **Recurring fair value measurements, liabilities:** |  |  |  |  |
| RPA In | $0  | $9  | $0  | $9 |
| Interest rate swap agreements, liabilities | 0  | 1664  | 0  | 1664 |
| Total recurring fair value measurements, liabilities | $0  | $1673  | $0  | $1673  |
| **Nonrecurring fair value measurements, assets:** |  |  |  |  |
| Loans individually evaluated for credit loss, net | $0  | $0  | $230  | $230  |
| Foreclosed assets held for sale | 0  | 0  | 402 | 402 |
| Total nonrecurring fair value measurements, assets | $0  | $0  | $632 | $632 |

---

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---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| **(In Thousands)** | **Quoted Prices**<br>**in Active Markets**<br>**(Level 1)** | **Other Observable**<br>**Inputs**<br>**(Level 2)** | **Unobservable**<br>**Inputs**<br>**(Level 3)** | <br>**Total**<br>**Fair Value** |
| **Recurring fair value measurements, assets:** |  |  |  |  |
| AVAILABLE-FOR-SALE DEBT SECURITIES: |  |  |  |  |
| Obligations of the U.S. Treasury | $7118 | $0  | $0  | $7118 |
| Obligations of U.S. Government agencies | 0  | 9025 | 0  | 9025 |
| Bank holding company debt securities | 0  | 25246 | 0  | 25246 |
| Obligations of states and political subdivisions: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Tax-exempt | 0  | 101302 | 0  | 101302 |
| &nbsp;&nbsp;&nbsp;&nbsp;Taxable | 0  | 42506 | 0  | 42506 |
| Mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored agencies: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Residential pass-through securities | 0  | 94414 | 0  | 94414 |
| &nbsp;&nbsp;&nbsp;&nbsp;Residential collateralized mortgage obligations | 0  | 49894 | 0  | 49894 |
| &nbsp;&nbsp;&nbsp;&nbsp;Commercial mortgage-backed securities | 0  | 64501 | 0  | 64501 |
| Private label commercial mortgage-backed securities | 0  | 8374 | 0  | 8374 |
| Total available-for-sale debt securities | 7118 | 395262 | 0  | 402380 |
| Marketable equity security | 863 | 0  | 0  | 863 |
| Servicing rights | 0  | 0  | 2782 | 2782 |
| RPA Out | 0  | 2  | 0  | 2 |
| Interest rate swap agreements, assets | 0  | 2385  | 0  | 2385 |
| Total recurring fair value measurements, assets | $7981 | $397649 | $2782 | $408412 |
| **Recurring fair value measurements, liabilities,** |  |  |  |  |
| RPA In | $0  | $2  | $0  | $2 |
| Interest rate swap agreements, liabilities | 0  | 2385  | 0  | 2385 |
| Total recurring fair value measurements, liabilities | $0  | $2387  | $0  | $2387  |
| **Nonrecurring fair value measurements, assets:** |  |  |  |  |
| Loans individually evaluated for credit loss, net | $0  | $0  | $136  | $136  |
| Foreclosed assets held for sale | 0  | 0  | 181 | 181 |
| Total nonrecurring fair value measurements, assets | $0  | $0  | $317 | $317 |

---

Level 2 valuation techniques used to measure fair value for the financial instruments in the preceding tables are as follows:

Available-for-sale debt securities - Level 2 debt securities are valued by a third-party pricing service. The pricing service uses pricing models that vary based on asset class and incorporate available market information, including quoted prices of investment securities with similar characteristics. Because many fixed income securities do not trade on a daily basis, pricing models use available information, as applicable, through processes such as benchmark yield curves, benchmarking of like securities, sector groupings and matrix pricing.

Derivative instruments - Interest rate SWAP agreements, RPA Out and RPA In- The fair value of derivatives are based on valuation models using observable market data as of the measurement date, valued by a third-party pricing service using quantitative models that utilize multiple market inputs. The inputs include prices and indices to generate continuous yield or pricing curves, estimates of current and potential future credit exposure and calculated discounted cash flow factors to value the position. The majority of market inputs are actively quoted and can be validated through external sources, including brokers, market transactions and third-party pricing services.

Management's evaluation and selection of valuation techniques and the unobservable inputs used in determining the fair values of assets valued using Level 3 methodologies include sensitive assumptions. Other market participants might use substantially different assumptions, which could result in calculations of fair values that would be substantially different than the amount calculated by management.

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At June 30, 2025 and December 31, 2024, quantitative information regarding valuation techniques and the significant unobservable inputs used for assets measured on a recurring basis using unobservable inputs (Level 3 methodologies) are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | | |  | **Method or Value As of** |
| **Asset** | **Fair Value at**<br>**6/30/2025**<br>**(In Thousands)** | <br>**Valuation**<br>**Technique** | <br>**Unobservable**<br>**Input(s)** |  | **6/30/2025** |
| Servicing rights | $2819 | Discounted cash flow | Discount rate | 13.00% | Rate used through modeling period |
|  |  |  | Loan prepayment speeds | 120.00% | Weighted-average PSA |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | | |  | **Method or Value As of** |
| **Asset** | **Fair Value at**<br>**12/31/2024**<br>**(In Thousands)** | <br>**Valuation**<br>**Technique** | <br>**Unobservable**<br>**Input(s)** |  | **12/31/2024** |
| Servicing rights | $2782 | Discounted cash flow | Discount rate | 13.00% | Rate used through modeling period |
|  |  |  | Loan prepayment speeds | 116.00% | Weighted-average PSA |

---

The fair value of servicing rights is affected by expected future interest rates. Increases (decreases) in future expected interest rates tend to increase (decrease) the fair value of the Corporation's servicing rights because of changes in expected prepayment behavior by the borrowers on the underlying loans.

Following is a reconciliation of activity for Level 3 assets measured at fair value on a recurring basis:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **(In Thousands)** | **Three Months Ended**  | **Three Months Ended**  | **Six Months Ended**  | **Six Months Ended**  |
|  | **June 30, 2025** | **June 30, 2024** | **June 30, 2025** | **June 30, 2024** |
| Servicing rights balance, beginning of period | $2767 | $2731 | $2782 | $2659 |
| Originations of servicing rights | 84 | 57 | 138 | 104 |
| Unrealized loss included in earnings | (32) | (68) | (101) | (43) |
| Servicing rights balance, end of period | $2819 | $2720 | $2819 | $2720 |

---

Loans are individually evaluated for credit loss when they do not share similar risk characteristics as similar loans within its loan pool. Foreclosed assets held for sale consist of real estate acquired by foreclosure. For individually evaluated loans secured by real estate and foreclosed assets held for sale, estimated fair values are determined primarily using values from third-party appraisals. Appraised values are discounted to arrive at the estimated selling price of the collateral, which is considered to be the estimated fair value. The discounts also include estimated costs to sell the property. The estimated fair value determined for individually evaluated loans secured by real estate and foreclosed assets held for sale used unobservable inputs (Level 3 methodologies).

[**Table of Contents**](#TOC)

At June 30, 2025 and December 31, 2024, quantitative information regarding valuation techniques and the significant unobservable inputs used for nonrecurring fair value measurements using Level 3 methodologies are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **(Dollars In Thousands)** | | | | | | |
| **Asset** | <br>**Balance at**<br>**6/30/2025** | <br>**Valuation**<br>**Allowance at**<br>**6/30/2025** | <br>**Fair Value at**<br>**6/30/2025** | <br>**Valuation**<br>**Technique** | <br>**Unobservable**<br>**Inputs** | **Range (Weighted**<br>**Average)**<br>**Discount at**<br>**6/30/2025** |
| Loans individually evaluated for credit loss: |  |  |  |  |  |  |
| &nbsp;&nbsp;Commercial real estate - owner occupied | $239 | $9 | $230 | Sales comparison & SBA guaranty | Discount to appraised value | 92% (92) |
| Total loans individually evaluated for credit loss | $239 | $9 | $230 |  |  |  |
| Foreclosed assets held for sale - real estate: |  |  |  |  |  |  |
| Residential (1-4 family) | $246 | $0  | $246 | Sales comparison | Discount to appraised value | 1%-84% (25) |
| Commercial real estate | 156 | 0  | 156 | Sales comparison | Discount to appraised value | 18%-77% (34) |
| Total foreclosed assets held for sale | $402 | $0  | $402 |  |  |  |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **(Dollars In Thousands)** | | | | | | |
| **Asset** | <br>**Balance at**<br>**12/31/2024** | <br>**Valuation**<br>**Allowance at**<br>**12/31/2024** | <br>**Fair Value at**<br>**12/31/2024** | <br>**Valuation**<br>**Technique** | <br>**Unobservable**<br>**Inputs** | **Range (Weighted**<br>**Average)**<br>**Discount at**<br>**12/31/2024** |
| Loans individually evaluated for credit loss: |  |  |  |  |  |  |
| &nbsp;&nbsp;Commercial real estate - owner occupied | $258 | $122 | $136 | Sales comparison & SBA guaranty | Discount to appraised value | 95% (95) |
| Total loans individually evaluated for credit loss | $258 | $122 | $136 |  |  |  |
| Foreclosed assets held for sale - real estate: |  |  |  |  |  |  |
| Residential (1-4 family) | $25 | $0  | $25 | Sales comparison | Discount to appraised value | 62% (62) |
| Commercial real estate | 156 | 0  | 156 | Sales comparison | Discount to appraised value | 18%-77% (34) |
| Total foreclosed assets held for sale | $181 | $0  | $181 |  |  |  |

---

Certain of the Corporation's financial instruments are not measured at fair value in the consolidated financial statements. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument. Certain financial instruments and all nonfinancial instruments are excluded from disclosure requirements. Therefore, the aggregate fair value amounts presented may not represent the underlying fair value of the Corporation.

[**Table of Contents**](#TOC)

The estimated fair values, and related carrying amounts, of the Corporation's financial instruments that are not recorded at fair value are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **(In Thousands)** | **Fair Value** | **June 30, 2025** | **June 30, 2025** | **December 31, 2024** | **December 31, 2024** |
|  | **Hierarchy**<br>**Level** | **Carrying**<br>**Amount** | **Fair**<br>**Value** | **Carrying**<br>**Amount** | **Fair**<br>**Value** |
| Financial assets: |  |  |  |  |  |
| &nbsp;&nbsp;Cash and cash equivalents | Level 1 | $97269 | $97269 | $123574 | $123574 |
| &nbsp;&nbsp;Certificates of deposit | Level 2 | 2350 | 2305 | 2600 | 2513 |
| &nbsp;&nbsp;Restricted equity securities (included in other assets) | N/A | 20963 | N/A | 21567 | N/A |
| &nbsp;&nbsp;Loans, net | Level 3 | 1897559 | 1832335 | 1875813 | 1789044 |
| &nbsp;&nbsp;Accrued interest receivable | Level 2 | 8719 | 8719 | 8735 | 8735 |
| Financial liabilities: |  |  |  |  |  |
| &nbsp;&nbsp;Deposits with no stated maturity | Level 2 | 1617925 | 1617925 | 1609552 | 1609552 |
| &nbsp;&nbsp;Time deposits | Level 2 | 491851 | 491193 | 484357 | 484900 |
| &nbsp;&nbsp;Short-term borrowings | Level 2 | 533 | 533 | 2488 | 2488 |
| &nbsp;&nbsp;Long-term borrowings - FHLB advances | Level 2 | 143894 | 145232 | 165451 | 165616 |
| &nbsp;&nbsp;Senior notes, net | Level 2 | 14934 | 14257 | 14899 | 13579 |
| &nbsp;&nbsp;Subordinated debt, net | Level 2 | 24889 | 23564 | 24831 | 21051 |
| &nbsp;&nbsp;Accrued interest payable | Level 2 | 1108 | 1108 | 1771 | 1771 |

---

13. SEGMENT REPORTING

**The Corporation's one reportable segment is determined by the President and Chief Executive Officer, who is the designated chief operating decision maker, based upon information provided about the Corporation's products and services offered, primarily community banking operations. The chief operating decision maker uses consolidated net income to assess performance by comparing it to and monitoring it against budget and prior year results. In addition, the chief operating decision maker uses the consolidated net income to benchmark the Corporation against its competitors. This information is used to manage resources to drive business and net earnings growth, including investment in key strategic priorities, as well as determine the Corporation's ability to return capital to shareholders. Loans, investments, deposits and assets held in a fiduciary or custodial capacity provide the revenues in the banking operation. Interest expense, provisions for credit losses, and payroll provide the significant expenses in the banking operation. All operations are domestic.**

Segment performance is evaluated using consolidated net income.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended**  | **Three Months Ended**  | **Six Months Ended**  | **Six Months Ended**  |
| **(In Thousands)** | **June 30, 2025** | **June 30, 2024** | **June 30, 2025** | **June 30, 2024** |
| Interest income | $32454 | $31326 | $64163 | $61662 |
| Interest expense | 11312 | 11881 | 23046 | 23176 |
| Net interest income | 21142 | 19445 | 41117 | 38486 |
| Provision for credit losses | 2354 | 565 | 2590 | 1519 |
| Net interest income after provision for credit losses | 18788 | 18880 | 38527 | 36967 |
| Other income: |  |  |  |  |
| &nbsp;&nbsp;Other noninterest income | 8142 | 7854 | 15150 | 14529 |
| Total other income | 8142 | 7854 | 15150 | 14529 |
| Other Noninterest Expense: |  |  |  |  |
| &nbsp;&nbsp;Salaries and employee benefits | 11067 | 11023 | 22826 | 22585 |
| &nbsp;&nbsp;Other segment expenses (1) | 8331 | 8232 | 15615 | 14974 |
| Total noninterest expense | 19398 | 19255 | 38441 | 37559 |
| Income before income tax provision | 7532 | 7479 | 15236 | 13937 |
| Income tax provision | 1415 | 1366 | 2826 | 2518 |
| NET INCOME | $6117 | $6113 | $12410 | $11419 |

---

[**Table of Contents**](#TOC)

(1) Other segment expenses included expenses for professional fees, data processing and telecommunications, net occupancy and equipment, merger related expenses, automated teller machine and interchange, Pennsylvania shares tax and other noninterest expenses.

The Corporation's segment assets represent the total assets as presented in the consolidated balance sheets at June 30, 2025 and December 31, 2024.

14. PENDING MERGER

On April 23, 2025, the Corporation announced that it had entered into an Agreement and Plan of Merger with Susquehanna Community Financial, Inc. ("SQCF") pursuant to which agreed to acquire SQCF. SQCF is the financial holding company for Susquehanna Community Bank ("Susquehanna"), which operates 7 banking offices in Central Pennsylvania. SQCF had assets of $593 million as of June 30, 2025. Under the terms of the definitive agreement, each share of SQCF's common stock issued and outstanding immediately prior to the effective time of the merger will be converted into the right to receive 0.80 shares of the Corporation's common stock. Holders of SQCF common stock prior to the consummation of the merger will own approximately 13% of the Corporation's common stock outstanding immediately following the consummation of the merger. The merger, which is expected to close in the fourth quarter of 2025, is subject to the satisfaction of customary closing conditions, including receipt of customary regulatory approvals and approval by SQCF's shareholders. In the second quarter 2025, the Corporation incurred merger-related expenses of $167,000 which primarily consisted of professional and legal fees.

[**Table of Contents**](#TOC)

#### ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Certain statements in this section and elsewhere in this quarterly report on Form 10-Q are forward-looking statements for purposes of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. Such forward-looking statements may include financial and other projections as well as statements regarding the Corporation that may include future plans, objectives, performance, revenues, growth, profits, operating expenses or the Corporation's underlying assumptions. Citizens & Northern Corporation and its wholly-owned subsidiaries (collectively, the Corporation) intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Reform Act of 1995. Forward-looking statements, are not statements of historical facts, are based on certain assumptions and describe future plans, business objectives and expectations, and are generally identifiable by the use of words such as, "may", "would", "will", "should", "likely", "possibly", "expect", "anticipate", "intend", "pro forma", "estimate", "target", "potentially", "probably", "outlook", "predict", "contemplate", "continue", "strategic", "objective", "plan", "forecast", "project", "believe" and "goal" or other similar words, phrases or concepts. Persons reading this document are cautioned that such statements are only predictions, and that the Corporation's actual future results or performance may be materially different. A number of factors could cause our actual results, events or developments, or industry results, to be materially different from any future results, events or developments expressed, implied or anticipated by such forward-looking statements. In addition to factors previously disclosed in the reports filed by C&N with the SEC, including our most recent annual report on Form 10-K and subsequent filings, and those identified elsewhere in this document, the following factors, among others, could cause actual results to differ materially from forward looking statements:

&nbsp;&nbsp;&nbsp;&nbsp;● changes in monetary and fiscal policies of the Federal Reserve Board and the U.S. Government, particularly related to changes in interest rates

● changes in general economic conditions

● the potential for adverse developments in the banking industry that could have a negative impact on customer confidence

● the Corporation's credit standards and its on-going credit assessment processes might not protect it from significant credit losses

● legislative or regulatory changes

● downturn in demand for loan, deposit and other financial services in the Corporation's market area

● increased competition from other banks and non-bank providers of financial services

&nbsp;&nbsp;&nbsp;&nbsp;● technological changes and increased technology-related costs

&nbsp;&nbsp;&nbsp;&nbsp;● information security breaches or other technology difficulties or failures

&nbsp;&nbsp;&nbsp;&nbsp;● changes in, or the application of, generally accepted accounting principles with respect to the presentation of the Corporation's financial statements

&nbsp;&nbsp;&nbsp;&nbsp;● fraud and cyber malfunction risks as usage of artificial intelligence continues to expand

&nbsp;&nbsp;&nbsp;&nbsp;● the One Big Beautiful Bill Act of 2025 presents disparate potential impacts on financial institutions and the ultimate impact will depend on how the bill is implemented, how other countries respond, and how the overall economy reacts to the changes;

&nbsp;&nbsp;&nbsp;&nbsp;● the execution of the transaction with SQCF may take longer than anticipated or be more costly to complete and that the anticipated benefits, including any anticipated cost savings or strategic gains, may be significantly harder to achieve or take longer than anticipated or may not be achieved;

&nbsp;&nbsp;&nbsp;&nbsp;● completion of the merger is dependent on, among other things, receipt of SQCF shareholder and regulatory approvals, the timing of which cannot be predicted with precision, and which may not be received at all or may be conditioned in a manner that would impair our ability to fully implement our business plans;

&nbsp;&nbsp;&nbsp;&nbsp;● integration efforts between the Corporation and SQCF may divert the attention of the management teams of the Corporation and SQCF and cause a loss in the momentum of their ongoing businesses;.

&nbsp;&nbsp;&nbsp;&nbsp;● success of the Corporation in SQCF's geographic market area will require the Corporation to attract and retain key personnel in the market and to differentiate the Corporation from its competitors in the market;

&nbsp;&nbsp;&nbsp;&nbsp;● the merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events.

These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. All forward-looking statements and information made herein are based on management's current beliefs and assumptions as of the date of filing of this document. The Corporation does not undertake to update forward-looking statements.

[**Table of Contents**](#TOC)

#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

#### PENDING ACQUISITION
On April 23, 2025, the Corporation announced that it had entered into an Agreement and Plan of Merger with Susquehanna Community Financial, Inc. ("SQCF") pursuant to which agreed to acquire SQCF. SQCF is the financial holding company for Susquehanna Community Bank ("Susquehanna"), which operates 7 banking offices in Central Pennsylvania. SQCF had assets of $593 million as of June 30, 2025. Under the terms of the definitive agreement, each share of SQCF's common stock issued and outstanding immediately prior to the effective time of the merger will be converted into the right to receive 0.80 shares of the Corporation's common stock. Holders of SQCF common stock prior to the consummation of the merger will own approximately 13% of the Corporation's common stock outstanding immediately following the consummation of the merger. The merger, which is expected to close in the fourth quarter of 2025, is subject to the satisfaction of customary closing conditions, including receipt of customary regulatory approvals and approval by SQCF's shareholders. In the second quarter, the Corporation incurred merger-related expenses of $167,000 which primarily consisted of professional and legal fees.

**EARNINGS OVERVIEW**

**Second Quarter 2025 as Compared to Second Quarter 2024**

Second quarter 2025 net income was $6,117,000, or $0.40 per diluted share, as compared to $6,113,000, or $0.40 per diluted share, in the second quarter 2024. Significant variances were as follows:

● Net interest income of $21,142,000 in the second quarter 2025 was $1,697,000 higher than in the second quarter 2024. The net interest margin increased to 3.52% in the second quarter 2025 from 3.31% in the second quarter 2024. The interest rate spread increased 0.23%, as the average yield on earning assets increased 0.07% while the average rate on interest-bearing liabilities decreased 0.16%. Average total earning assets increased $46,907,000 from the second quarter 2024, as average interest-bearing due from banks increased $36,729,000 and average total loans receivable increased $18,034,000, or 1.0%. Average total deposits increased $73,221,000, or 3.6% while total borrowed funds decreased $52,236,000, or 21.5%.

● The provision for credit losses was $2,354,000 for the second quarter 2025 as compared to a provision for credit losses of $565,000 in the second quarter 2024. The provision for the second quarter 2025 included a provision related to loans receivable of $2,075,000 and a provision related to off-balance sheet exposures of $279,000. The provision in the second quarter of 2025 resulted mainly from increases in the allowance for credit losses ("ACL") related to changes in qualitative factors and an economic forecast. During the second quarter 2025, there was a partial charge-off of $333,000 on a commercial construction and land loan with no individual allowance at March 31, 2025 and a partial charge-off of $208,000 on a commercial line of credit with an individual allowance of $142,000 at March 31, 2025.

Net charge-offs totaled $548,000, or 0.12% (annualized) of average loans receivable, in the second quarter of 2025 as compared to $207,000, or 0.04% (annualized) of average loans receivable, in the second quarter of 2024. The ACL as a percentage of gross loans receivable was 1.13% at June 30, 2025, an increase from 1.06% March 31, 2025.

● Noninterest income of $8,142,000 in the second quarter 2025 increased $288,000 from the second quarter 2024 result. Significant variances included the following:

Interchange revenue from debit card transactions of $1,218,000 increased $129,000 reflecting an increase in volume-related incentive income.

Other noninterest income of $2,030,000 increased $87,000, including increases of $34,000 in letter of credit fees, $33,000 in income from tax credits related to donations, and $24,000 of interest-rate swap fee income with no comparable amount in 2024.

Net gains from sale of loans of $312,000 increased $77,000 reflecting an increase in volume of residential mortgage loans sold.

● Noninterest expense of $19,398,000 in the second quarter 2025 increased $143,000 from the second quarter 2024 expense including merger-related expenses of $167,000 discussed above with no comparable amount in 2024.

[**Table of Contents**](#TOC)

#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
**Six Months Ended June 30, 2025 as Compared to Six Months Ended June 30, 2024**

Net income for the six-month period ended June 30, 2025 was $12,410,000, or $0.80 per diluted share, as compared to $11,419,000, or $0.74 per diluted share, for the first six months of 2024. Significant variances were as follows:

● Net interest income totaled $41,117,000 in the six months ended June 30, 2025, an increase of $2,631,000 from the total for the first six months of 2024. The net interest margin was 3.45% for the first six months of 2025, up from 3.30% in the corresponding period of 2024. The interest rate spread increased 0.15%, as the average rate on interest-bearing liabilities was 0.05% lower while the average yield on earning assets increased 0.10%. Average total earning assets increased $56,090,000, including an increase in interest-bearing due from banks of $35,983,000 and an increase in average loans receivable of $29,116,000, or 1.6%. Average total deposits increased $66,641,000, or 3.3%, despite a $58,784,000 reduction in average brokered deposits to $17,531,000 for the first six months of 2025 as compared to $76,315,000 for the first six months of 2024, while average total borrowed funds decreased $37,864,000.

● For the six months ended June 30, 2025, the provision for credit losses was $2,590,000, an increase of $1,071,000 from the first six months of 2024. The provision in the six months ended June 30, 2025, included the impact of increases in the ACL related to changes in qualitative factors and an economic forecast. In the first six months of 2025, the ACL on loans receivable increased $1,664,000 to 1.13% at June 30, 2025 as compared to 1.06% at December 31, 2024. Net charge-offs totaled $639,000, or 0.07% (annualized) of average loans receivable for the six months ended June 30, 2025 compared to $352,000, or 0.04% (annualized) of average loans receivable for the first six months of 2024.

● Noninterest income totaled $15,150,000 in the first six months of 2025, up $621,000 from the total for the first six months of 2024. Significant variances included the following:

Other noninterest income of $3,162,000 increased $202,000 including increases in letter of credit fees of $68,000, income from tax credits related to donations of $51,000, changes in the fair value of a marketable equity security of $29,000, credit card interchange fees of $26,000 and interest-rate swap fee income of $24,000 with no comparable amount in 2024.

Trust revenue of $4,069,000 increased $158,000, consistent with appreciation in the trading prices of many U.S. equity securities and included an increase in estate fees.

Interchange revenue from debit card transactions of $2,254,000 increased $152,000, including an increase in volume-related incentive income.

Net gains from sale of loans of $517,000 increased $91,000, reflecting an increase in volume of residential mortgage loans sold.

● Noninterest expense totaled $38,441,000 for the first six months of 2025, an increase of $882,000 from the total for the first six months of 2024. Significant variances included the following:

Other noninterest expense of $5,755,000 increased $456,000. Within this category, significant variances included the following:

---

| | |
|:---|:---|
| ◾ | In 2025, there was a reduction in expense associated with the defined benefit postretirement medical benefit plan of $33,000. In comparison, in 2024, there was a reduction in expense of $498,000 related to the defined benefit postretirement medical benefit plan, including a curtailment gain of $469,000. |

---

---

| | |
|:---|:---|
| ◾ | Legal fees totaled $138,000 in the first six months of 2025, a decrease of $134,000. |

---

[**Table of Contents**](#TOC)

Salaries and employee benefits expense of $22,826,000 increased $241,000, including increases of $398,000 in cash-and stock-based incentive compensation and $136,000 in wealth management-related commissions while health insurance expenses decreased $206,000 due to a reduction in claims on C&N's partially self-funded plan and base salaries decreased $129,000, or 0.8%.

Merger-related expenses were $167,000, primarily consisting of professional and legal fees, with no comparable expenses in 2024 as discussed above.

Automated teller machine and interchange expenses decreased $170,000, reflecting the effects of pricing improvements negotiated in mid-2024.

● The income tax provision of $2,826,000, or 18.5% of pre-tax income, for 2025 increased $308,000 from $2,518,000, or 18.1% of pre-tax income, for 2024. The increase in income tax provision was consistent with the increase in pre-tax income of $1,299,000 .

#### TABLE I – QUARTERLY FINANCIAL DATA

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **(Dollars In Thousands,** | **For the Three Months Ended :** | **For the Three Months Ended :** | **For the Three Months Ended :** | **For the Three Months Ended :** | **For the Three Months Ended :** |
| **Except Per Share Data)** | **June 30,**  | **March 31,**  | **December 31,**  | **September 30,**  | **June 30,**  |
| **(Unaudited)** | **2025** | **2025** | **2024** | **2024** | **2024** |
| Interest and dividend income | $32454 | $31709 | $33329 | $33087 | $31326 |
| Interest expense | 11312 | 11734 | 12856 | 12931 | 11881 |
| Net interest income | 21142 | 19975 | 20473 | 20156 | 19445 |
| Provision (credit) for credit losses | 2354 | 236 | (531) | 1207 | 565 |
| Net interest income after provision (credit) for credit losses | 18788 | 19739 | 21004 | 18949 | 18880 |
| Noninterest income | 8142 | 7008 | 7547 | 7133 | 7854 |
| Noninterest expense | 19398 | 19043 | 18430 | 18269 | 19255 |
| Income before income tax provision | 7532 | 7704 | 10121 | 7813 | 7479 |
| Income tax provision | 1415 | 1411 | 1947 | 1448 | 1366 |
| Net income | $6117 | $6293 | $8174 | $6365 | $6113 |
| Net income attributable to common shares | $6068 | $6242 | $8103 | $6311 | $6066 |
| Basic and diluted earnings per common share | $0.40 | $0.41 | $0.53 | $0.41 | $0.40 |

---

#### NONINTEREST INCOME
**TABLE II – COMPARISON OF NONINTEREST INCOME**

---

| | | | |
|:---|:---|:---|:---|
| **(Dollars in Thousands)** | **Three Months Ended**  | **Three Months Ended**  |  |
|  | **June 30,**  | **June 30,**  | $**%** |
|  | **2025** | **2024** | **Change** |
| Trust revenue | $1967 | $2014 | (2.3)% |
| Brokerage and insurance revenue | 554 | 527 | 5.1% |
| Service charges on deposit accounts | 1422 | 1472 | (3.4)% |
| Interchange revenue from debit card transactions | 1218 | 1089 | 11.8% |
| Net gains from sales of loans | 312 | 235 | 32.8% |
| Loan servicing fees, net | 173 | 130 | 33.1% |
| Increase in cash surrender value of life insurance | 466 | 444 | 5.0% |
| Other noninterest income | 2030 | 1943 | 4.5% |
| Total noninterest income | $8142 | $7854 | 3.7% |

---

[**Table of Contents**](#TOC)

#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

---

| | | | |
|:---|:---|:---|:---|
| **(Dollars in Thousands)** | **Six Months Ended**  | **Six Months Ended**  |  |
|  | **June 30,**  | **June 30,**  | $**%** |
|  | **2025** | **2024** | **Change** |
| Trust revenue | $4069 | $3911 | 4.0% |
| Brokerage and insurance revenue | 1052 | 1066 | (1.3)% |
| Service charges on deposit accounts | 2862 | 2790 | 2.6% |
| Interchange revenue from debit card transactions | 2254 | 2102 | 7.2% |
| Net gains from sales of loans | 517 | 426 | 21.4% |
| Loan servicing fees, net | 311 | 360 | (13.6)% |
| Increase in cash surrender value of life insurance | 923 | 914 | 1.0% |
| Other noninterest income | 3162 | 2960 | 6.8% |
| Total noninterest income | $15150 | $14529 | 4.3% |

---

#### NONINTEREST EXPENSE
**TABLE III - COMPARISON OF NONINTEREST EXPENSE**

---

| | | | |
|:---|:---|:---|:---|
| **(Dollars in Thousands)**  | **Three Months Ended**  | **Three Months Ended**  |  |
|  | **June 30,**  | **June 30,**  | $**%**  |
|  | **2025** | **2024** | **Change**  |
| Salaries and employee benefits | $11067 | $11023 | 0.4% |
| Net occupancy and equipment expense | 1403 | 1333 | 5.3% |
| Data processing and telecommunications expense | 1981 | 2003 | (1.1)% |
| Automated teller machine and interchange expense | 403 | 473 | (14.8)% |
| Pennsylvania shares tax | 470 | 434 | 8.3% |
| Professional fees | 506 | 552 | (8.3)% |
| Other noninterest expense | 3401 | 3437 | (1.0)% |
| Total noninterest expense, excluding merger-related expenses | 19231 | 19255 | (0.1)% |
| Merger-related expenses | 167 | 0 | 0.0% |
| Total noninterest expense | $19398 | $19255 | 0.7% |

---

---

| | | | |
|:---|:---|:---|:---|
| **(Dollars in Thousands)**  | **Six Months Ended**  | **Six Months Ended**  |  |
|  | **June 30,**  | **June 30,**  | $**%**  |
|  | **2025** | **2024** | **Change**  |
| Salaries and employee benefits | $22826 | $22585 | 1.1% |
| Net occupancy and equipment expense | 2862 | 2783 | 2.8% |
| Data processing and telecommunications expense | 4052 | 3995 | 1.4% |
| Automated teller machine and interchange expense | 790 | 960 | (17.7)% |
| Pennsylvania shares tax | 966 | 867 | 11.4% |
| Professional fees | 1023 | 1070 | (4.4)% |
| Other noninterest expense | 5755 | 5299 | 8.6% |
| Total noninterest expense, excluding merger-related expenses | 38274 | 37559 | 1.9% |
| Merger-related expenses | 167 | 0 | 0.0% |
| Total noninterest expense | $38441 | $37559 | 2.3% |

---

Additional detailed information concerning fluctuations in the Corporation's earnings results and other financial information are provided in other sections of Management's Discussion and Analysis.

[**Table of Contents**](#TOC)

#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

#### CRITICAL ACCOUNTING POLICIES
The presentation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect many of the reported amounts and disclosures. Actual results could differ from these estimates.

**Allowance for Credit Losses on Loans** – A material estimate that is particularly susceptible to significant change is the determination of the allowance for credit losses (ACL) on loans. The Corporation maintains an ACL on loans which represents management's estimate of expected net charge-offs over the life of the loans. The ACL includes two primary components: (i) an allowance established on loans which share similar risk characteristics collectively evaluated for credit losses (collective basis), and (ii) an allowance established on loans which do not share similar risk characteristics with any loan segment and which are individually evaluated for credit losses (individual basis). Management considers the determination of the ACL on loans to be critical because it requires significant judgment regarding estimates of expected credit losses based on the Corporation's historical loss experience, current conditions and economic forecasts. Management's evaluation is based upon a continuous review of the Corporation's loans, with consideration given to evaluations resulting from examinations performed by regulatory authorities. Note 6 to the unaudited consolidated financial statements provides an overview of the process management uses for determining the ACL, and additional discussion of the ACL is provided in a separate section below of Management's Discussion and Analysis.

The ACL may increase or decrease due to changes in economic conditions affecting borrowers and macroeconomic variables, including new information regarding existing problem loans, identification of additional problem loans, changes in the fair value of underlying collateral, unforeseen events such as natural disasters and pandemics, and other factors. Because current economic conditions and forecasts can change and future events are inherently difficult to predict, the anticipated amount of estimated credit losses on loans, and therefore the appropriateness of the ACL, could change significantly.

#### NET INTEREST INCOME
The Corporation's primary source of operating income is net interest income, which is equal to the difference between the amounts of interest income and interest expense. Tables IV, V and VI include information regarding the Corporation's net interest income for the three-month and six-month periods ended June 30, 2025 and 2024. In each of these tables, the amounts of interest income earned on tax-exempt securities and loans have been adjusted to a fully taxable-equivalent basis. Management believes presentation of net interest income on a fully taxable-equivalent basis, which is a non-GAAP financial measure, provides investors with meaningful information for purposes of comparing returns on tax-exempt securities and loans with returns on taxable securities and loans. Accordingly, the amount of net interest income on a fully taxable-equivalent basis reflected in these tables exceed the net interest income amounts presented in the consolidated financial statements. A reconciliation of net interest income on a fully taxable-equivalent basis to the closest GAAP financial measure is included with Table IV. The discussion that follows is based on amounts in the related tables.

**Three-Month Periods Ended June 30, 2025 and 2024**

Fully taxable equivalent net interest income (a non-GAAP measure) was $21,362,000 in the second quarter of 2025, $1,715,000 (8.7%) higher than in the second quarter of 2024. The increase in net interest income reflected an increase in interest income of $1,146,000 and a decrease in interest expense of $569,000. As presented in Table V, the Net Interest Margin was 3.52% in the second quarter 2025 as compared to 3.31% in the second quarter 2024, and the "Interest Rate Spread" (excess of average rate of return on earning assets over average cost of funds on interest-bearing liabilities) increased to 2.84% in 2025 from 2.61% in 2024. The average yield on earning assets of 5.39% was 0.07% higher in 2025 compared to 2024, and the average rate on interest-bearing liabilities of 2.55% in 2025 was 0.16% lower. Additionally, average total earning assets increased $46,907,000 as average interest-bearing due from banks increased $36,729,000 and average total loans increased $18,034,000 while average total deposits increased $73,221,000 (3.6%) offset by a decrease in total average borrowed funds of $52,236,000. As presented in Table VI, the net impact of changes in interest rates increased net interest income in the second quarter 2025 as compared to second quarter 2024 by $1,123,000 and changes in volume of earning assets and interest-bearing liabilities increased net interest income by $592,000.

INTEREST INCOME AND EARNING ASSETS

Interest income totaled $32,674,000 in 2025, an increase of $1,146,000, or 3.6% from 2024.

[**Table of Contents**](#TOC)

#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
Interest and fees from loans receivable increased $574,000 in 2025 as compared to 2024. The fully taxable equivalent yield on loans in 2025 increased to 6.07% from 6.03% in 2024, reflecting the effects of gradual paydowns on loans originated prior to interest rates rising in 2022 and 2023 with more recent loans originated at higher market rates. Average outstanding loans receivable increased $18,034,000 (1.0%) to $1,901,420,000 in 2025 from $1,883,386,000 in 2024.

Income from interest-bearing due from banks totaled $855,000 in 2025, an increase of $339,000 from the total for 2024. Within this category, the largest asset balance in 2025 and 2024 has been interest-bearing deposits held with the Federal Reserve. The average yield on interest-bearing due from banks was 4.29% in 2025, down from 4.81% in 2024. The average balance of interest-bearing due from banks was $79,868,000 in 2025, up $36,729,000 from $43,139,000 in 2024. The net increase in average interest-bearing due from banks for 2025 as compared to 2024 reflected net sources of cash from deposit growth, a reduction in other assets resulting mainly from collection of a receivable related to redemption of an insurance policy, and a reduction in average available-for-sale debt securities, partially offset by net uses of cash for loan growth and a decrease in borrowed funds.

Interest income from available-for-sale debt securities, on a fully taxable-equivalent basis, totaled $2,987,000 in 2025, up $224,000 from 2024, as the average yield on available-for-sale debt securities was 2.67% in 2025, up from 2.43% in 2024. The average balance (at amortized cost) of available-for-sale debt securities decreased $8,513,000 between periods.

INTEREST EXPENSE AND INTEREST-BEARING LIABILITIES

Interest expense decreased $569,000 to $11,312,000 in 2025 from $11,881,000 in 2024.

Interest expense on deposits decreased $30,000, as the average rate decreased to 2.34% in 2025 from 2.46% in 2024 while the average balance of interest-bearing deposits increased $68,974,000. Average total deposits (interest-bearing and noninterest-bearing) increased $73,221,000 (3.6%) in the second quarter of 2025 as compared to 2024. Within average deposits, average brokered deposits were $8,582,000 at an average rate of 4.47% in the second quarter of 2025 as compared to $68,311,000 at an average rate of 5.21% in the second quarter of 2024. In comparing the second quarter 2025 to the second quarter 2024, average time deposits increased $28,364,000, average interest checking deposits increased $25,387,000, average total money market accounts increased $24,200,000 and average noninterest-bearing demand deposits increased $4,247,000 while average savings deposits decreased $8,977,000.

Interest expense on borrowed funds decreased $539,000 in 2025 as compared to 2024. Interest expense on short-term borrowings was $1,000 in 2025 compared to $360,000 in 2024 as the average balance of short-term borrowings decreased to $980,000 in 2025 from $27,732,000 in 2024. Interest expense on long-term borrowings (FHLB advances) decreased $181,000 to $1,674,000 in 2025 from $1,855,000 in 2024. The average balance of long-term borrowings was $149,704,000 in 2025, down from an average balance of $175,373,000 in 2024. The average rate on long-term borrowings was 4.49% in 2025 compared to 4.25% in 2024. Borrowings are classified as long-term within the Tables based on their term at origination or assumption in business combinations.

More information regarding borrowed funds is provided in Note 8 to the unaudited consolidated financial statements.

**Six-Month Periods Ended June 30, 2025 and 2024**

For the six-month periods, fully taxable equivalent net interest income was $41,548,000 in 2025, which was $2,665,000 (6.9%) higher than in 2024. The increase in net interest income reflected an increase in interest income of $2,535,000 and a decrease in interest expense of $130,000. As presented in Table VI, the net impact of changes in interest rates increased net interest income for the six months ended June 30, 2025 over the six months ended June 30, 2024 by $1,879,000 and the net impact of changes in volume of earning assets and interest-bearing liabilities increased net interest income by $786,000. As presented in Table V, the Net Interest Margin was 3.45% in the first six months of 2025 as compared to 3.30% in the first six months of 2024, and the "Interest Rate Spread" (excess of average rate of return on earning assets over average cost of funds on interest-bearing liabilities) increased to 2.77% in 2025 from 2.62% in 2024. The average yield on earning assets of 5.37% was 0.10% higher in 2025 as compared to 2024, while the average rate on interest-bearing liabilities of 2.60% in 2025 was 0.05% lower compared to 2024.

INTEREST INCOME AND EARNING ASSETS

Interest income totaled $64,594,000 in 2025, an increase of $2,535,000 from 2024.

[**Table of Contents**](#TOC)

Interest and fees from loans receivable increased $1,432,000 in 2025 as compared to 2024. In the six-month period ended June 30, 2025, the fully taxable equivalent yield on loans was 6.05%, up from 5.97% in the first half of 2024, reflecting the effects of gradual paydowns on loans originated prior to interest rates rising in 2022 and 2023 with more recent loans originated at higher market rates. Average outstanding loans receivable increased $29,116,000 (1.6%) to $1,900,432,000 in 2025 from $1,871,316,000 in 2024.

Income from interest-bearing due from banks totaled $1,576,000 in 2025, an increase of $677,000 from 2024. The average balance of interest-bearing due from banks was $73,915,000 in 2025, up from $37,932,000 in 2024. Within this category, the largest asset balance in 2025 and 2024 has been interest-bearing deposits held with the Federal Reserve. The average yield on interest-bearing due from banks was 4.30% in 2025, down from 4.77% in 2024.

Interest income from available-for-sale debt securities, on a fully taxable-equivalent basis, totaled $5,937,000 in 2025, up $415,000 from 2024, as the average yield on available-for-sale debt securities was 2.66% in 2025, up from 2.42% in 2024. The average balance (at amortized cost) of available-for-sale debt securities decreased to $449,533,000 in 2025 from $459,070,000 in 2024.

INTEREST EXPENSE AND INTEREST-BEARING LIABILITIES

For the six-month periods, interest expense decreased $130,000 to $23,046,000 in 2025 from $23,176,000 in 2024.

Interest expense on deposits increased $671,000, as the average balance of interest-bearing deposits increased $66,729,000. The average rate on interest-bearing deposits was 2.40% in 2025 and 2.41% in 2024. Average total deposits (interest-bearing and noninterest-bearing) amounted to $2,075,540,000 for the first six months of 2025, up $66,641,000 (3.3%) from the first six months of 2024. Within average total deposits, average brokered deposits (primarily time and money market) were $17,531,000 with an average interest rate of 4.69% in 2025, down from $76,315,000 with an average interest rate of 5.22% in 2024. Average time deposits increased $46,727,000, average interest checking deposits increased $24,872,000 and average money market accounts increased $8,265,000 while average balance of savings accounts decreased $13,135,000.

Interest expense on borrowed funds decreased $801,000 in 2025 as compared to 2024. Interest expense on short-term borrowings of $1,000 in 2025 was down from $957,000 in 2024 as the average balance of short-term borrowings decreased to $1,189,000 in 2025 from $36,187,000 in 2024. The average rate on short-term borrowings was 0.17% in 2025 compared to 5.32% in 2024. Interest expense on long-term borrowings (FHLB advances) increased $152,000 to $3,463,000 in 2025 from $3,311,000 in 2024 as the average rate on long-term borrowings was 4.48% in 2025 compared to 4.19% in 2024 while the average balance of long-term borrowings decreased to $156,013,000 in 2025 from $159,063,000 in 2024. Borrowings are classified as long-term within the Tables based on their term at origination or assumption in business combinations.

More information regarding borrowed funds is provided in Note 8 to the unaudited consolidated financial statements.

[**Table of Contents**](#TOC)

#### TABLE IV - ANALYSIS OF INTEREST INCOME AND EXPENSE

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** |  | **Six Months Ended** | **Six Months Ended** |  |
|  | **June 30,**  | **June 30,**  | **Increase/** | **June 30,**  | **June 30,**  | **Increase/** |
| **(In Thousands)** | **2025** | **2024** | **(Decrease)** | **2025** | **2024** | **(Decrease)** |
| INTEREST INCOME |  |  |  |  |  |  |
| Interest-bearing due from banks | $855 | $516 | $339 | $1576 | $899 | $677 |
| Available-for-sale debt securities: |  |  |  |  |  |  |
| &nbsp;&nbsp;Taxable | 2329 | 2137 | 192 | 4631 | 4273 | 358 |
| &nbsp;&nbsp;Tax-exempt | 658 | 626 | 32 | 1306 | 1249 | 57 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total available-for-sale debt securities | 2987 | 2763 | 224 | 5937 | 5522 | 415 |
| Loans receivable: |  |  |  |  |  |  |
| &nbsp;&nbsp;Taxable | 28051 | 27490 | 561 | 55554 | 54193 | 1361 |
| &nbsp;&nbsp;Tax-exempt | 743 | 730 | 13 | 1471 | 1400 | 71 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total loans receivable | 28794 | 28220 | 574 | 57025 | 55593 | 1432 |
| Other earning assets | 38 | 29 | 9 | 56 | 45 | 11 |
| Total Interest Income | 32674 | 31528 | 1146 | 64594 | 62059 | 2535 |
| INTEREST EXPENSE |  |  |  |  |  |  |
| Interest-bearing deposits: |  |  |  |  |  |  |
| &nbsp;&nbsp;Interest checking | 2708 | 2836 | (128) | 5435 | 5642 | (207) |
| &nbsp;&nbsp;Money market | 1948 | 1917 | 31 | 3929 | 4097 | (168) |
| &nbsp;&nbsp;Savings | 49 | 52 | (3) | 98 | 107 | (9) |
| &nbsp;&nbsp;Time deposits | 4579 | 4509 | 70 | 9414 | 8359 | 1055 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total interest-bearing deposits | 9284 | 9314 | (30) | 18876 | 18205 | 671 |
| Borrowed funds: |  |  |  |  |  |  |
| &nbsp;&nbsp;Short-term | 1  | 360 | (359) | 1 | 957 | (956) |
| &nbsp;&nbsp;Long-term - FHLB advances | 1674 | 1855 | (181) | 3463 | 3311 | 152 |
| &nbsp;&nbsp;Senior notes, net | 120 | 120 | 0 | 241 | 240 | 1 |
| &nbsp;&nbsp;Subordinated debt, net | 233 | 232 | 1 | 465 | 463 | 2 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total borrowed funds | 2028 | 2567 | (539) | 4170 | 4971 | (801) |
| Total Interest Expense | 11312 | 11881 | (569) | 23046 | 23176 | (130) |
| Net Interest Income | $21362 | $19647 | $1715 | $41548 | $38883 | $2665 |

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Note: Interest income from tax-exempt securities and loans has been adjusted to a fully taxable-equivalent basis (a non-GAAP measure), using the Corporation's marginal federal income tax rate of 21%. The following table reconciles net interest income under U.S. GAAP as compared to net interest income as adjusted to a fully taxable-equivalent basis.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **(In Thousands)** | **Three Months Ended** | **Three Months Ended** |  | **Six Months Ended** | **Six Months Ended** |  |
|  | **June 30,**  | **June 30,**  | **Increase/** | **June 30,**  | **June 30,**  | **Increase/** |
|  | **2025** | **2024** | **(Decrease)** | **2025** | **2024** | **(Decrease)** |
| Net Interest Income Under U.S. GAAP | $21142 | $19445 | $1697 | $41117 | $38486 | $2631 |
| Add: fully taxable-equivalent interest income adjustment from tax-exempt securities | 79 | 67  | 12 | 154 | 136 | 18  |
| Add: fully taxable-equivalent interest income adjustment from tax-exempt loans | 141 | 135 | 6 | 277 | 261 | 16 |
| Net Interest Income as adjusted to a fully taxable-equivalent basis | $21362 | $19647 | $1715 | $41548 | $38883 | $2665 |

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[**Table of Contents**](#TOC)

#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
**TABLE V - Analysis of Average Daily Balances and Rates**

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **(Dollars in Thousands)** | | | | | | | | |
|  | **Three Months**<br>**Ended**<br>**6/30/2025**<br>**Average**<br>**Balance** | <br>**Rate of**<br>**Return/**<br>**Cost of**<br>**Funds %** | **Three Months**<br>**Ended**<br>**6/30/2024**<br>**Average**<br>**Balance** | <br>**Rate of**<br>**Return/**<br>**Cost of**<br>**Funds %** | **Six Months**<br>**Ended**<br>**6/30/2025**<br>**Average**<br>**Balance** | <br>**Rate of**<br>**Return/**<br>**Cost of**<br>**Funds %** | **Six Months**<br>**Ended**<br>**6/30/2024**<br>**Average**<br>**Balance** | <br>**Rate of**<br>**Return/**<br>**Cost of**<br>**Funds %** |
| EARNING ASSETS |  |  |  |  |  |  |  |  |
| Interest-bearing due from banks | $79868 | 4.29% | $43139 | 4.81% | $73915 | 4.30% | $37932 | 4.77% |
| Available-for-sale debt securities, at amortized cost: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Taxable | 338539 | 2.76% | 343971 | 2.50% | 339045 | 2.75% | 345928 | 2.48% |
| &nbsp;&nbsp;&nbsp;Tax-exempt | 109840 | 2.40% | 112921 | 2.23% | 110488 | 2.38% | 113142 | 2.22% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total available-for-sale debt securities | 448379 | 2.67% | 456892 | 2.43% | 449533 | 2.66% | 459070 | 2.42% |
| Loans receivable: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Taxable | 1814171 | 6.20% | 1792556 | 6.17% | 1811622 | 6.18% | 1783310 | 6.11% |
| &nbsp;&nbsp;&nbsp;Tax-exempt | 87249 | 3.42% | 90830 | 3.23% | 88810 | 3.34% | 88006 | 3.20% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans receivable | 1901420 | 6.07% | 1883386 | 6.03% | 1900432 | 6.05% | 1871316 | 5.97% |
| Other earning assets | 2833 | 5.38% | 2176 | 5.36% | 2308 | 4.89% | 1780 | 5.08% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Earning Assets | 2432500 | 5.39% | 2385593 | 5.32% | 2426188 | 5.37% | 2370098 | 5.27% |
| Cash | 22139 |  | 22396 |  | 21533 |  | 21422 |  |
| Unrealized loss on securities | (42561) |  | (56765) |  | (43478) |  | (53807) |  |
| Allowance for credit losses | (20568) |  | (20290) |  | (20455) |  | (19887) |  |
| Bank-owned life insurance | 51844 |  | 50018 |  | 51615 |  | 52242 |  |
| Bank premises and equipment | 21339 |  | 21994 |  | 21334 |  | 21891 |  |
| Intangible assets | 54425 |  | 54827 |  | 54477 |  | 54876 |  |
| Other assets | 73041 |  | 89859 |  | 72487 |  | 86369 |  |
| Total Assets | $2592159 |  | $2547632 |  | $2583701 |  | $2533204 |  |
| INTEREST-BEARING LIABILITIES |  |  |  |  |  |  |  |  |
| Interest-bearing deposits: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest checking | $542532 | 2.00% | $517145 | 2.21% | $540897 | 2.03% | $516025 | 2.20% |
| &nbsp;&nbsp;&nbsp;Money market | 364238 | 2.15% | 340038 | 2.27% | 359716 | 2.20% | 351451 | 2.34% |
| &nbsp;&nbsp;&nbsp;Savings | 198553 | 0.10% | 207530 | 0.10% | 197269 | 0.10% | 210404 | 0.10% |
| &nbsp;&nbsp;&nbsp;Time deposits | 486249 | 3.78% | 457885 | 3.96% | 490212 | 3.87% | 443485 | 3.79% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest-bearing deposits | 1591572 | 2.34% | 1522598 | 2.46% | 1588094 | 2.40% | 1521365 | 2.41% |
| Borrowed funds: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Short-term | 980 | 0.41% | 27732 | 5.22% | 1189 | 0.17% | 36187 | 5.32% |
| &nbsp;&nbsp;&nbsp;Long-term - FHLB advances | 149704 | 4.49% | 175373 | 4.25% | 156013 | 4.48% | 159063 | 4.19% |
| &nbsp;&nbsp;&nbsp;Senior notes, net | 14926 | 3.22% | 14856 | 3.25% | 14917 | 3.26% | 14848 | 3.25% |
| &nbsp;&nbsp;&nbsp;Subordinated debt, net | 24874 | 3.76% | 24759 | 3.77% | 24860 | 3.77% | 24745 | 3.76% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total borrowed funds | 190484 | 4.27% | 242720 | 4.25% | 196979 | 4.27% | 234843 | 4.26% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Interest-bearing Liabilities | 1782056 | 2.55% | 1765318 | 2.71% | 1785073 | 2.60% | 1756208 | 2.65% |
| Demand deposits | 498169 |  | 493922 |  | 487446 |  | 487534 |  |
| Other liabilities | 29260 |  | 29972 |  | 30761 |  | 29679 |  |
| Total Liabilities | 2309485 |  | 2289212 |  | 2303280 |  | 2273421 |  |
| Stockholders' equity, excluding accumulated other comprehensive loss | 315520 |  | 302758 |  | 313982 |  | 301895 |  |
| Accumulated other comprehensive loss | (32846) |  | (44338) |  | (33561) |  | (42112) |  |
| Total Stockholders' Equity | 282674 |  | 258420 |  | 280421 |  | 259783 |  |
| Total Liabilities and Stockholders' Equity | $2592159 |  | $2547632 |  | $2583701 |  | $2533204 |  |
| Interest Rate Spread |  | 2.84% |  | 2.61% |  | 2.77% |  | 2.62% |
| Net Interest Income/Earning Assets |  | 3.52% |  | 3.31% |  | 3.45% |  | 3.30% |
| Total Deposits (Interest-bearing and Demand) | $2089741 |  | $2016520 |  | $2075540 |  | $2008899 |  |

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&nbsp;&nbsp;&nbsp;&nbsp;(1) Annualized rates of return on tax-exempt securities and loans are presented on a fully taxable-equivalent basis, using the Corporation's marginal federal income tax rate of 21%.

&nbsp;&nbsp;&nbsp;&nbsp;(2) Nonaccrual loans have been included with loans for the purpose of analyzing net interest earnings.

&nbsp;&nbsp;&nbsp;&nbsp;(3) Rates of return on earning assets and costs of funds are presented on an annualized basis.

[**Table of Contents**](#TOC)

**TABLE VI - ANALYSIS OF VOLUME AND RATE CHANGES**

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **(In Thousands)** | **Three Months Ended 6/30/2025 vs. 6/30/2024** | **Three Months Ended 6/30/2025 vs. 6/30/2024** | **Three Months Ended 6/30/2025 vs. 6/30/2024** | **Six Months Ended 6/30/2025 vs. 6/30/2024** | **Six Months Ended 6/30/2025 vs. 6/30/2024** | **Six Months Ended 6/30/2025 vs. 6/30/2024** |
|  | **Change in**<br>**Volume** | **Change in**<br>**Rate** | **Total**<br>**Change** | **Change in**<br>**Volume** | **Change in**<br>**Rate** | **Total**<br>**Change** |
| EARNING ASSETS |  |  |  |  |  |  |
| Interest-bearing due from banks | $400  | $(61) | $339  | $773  | $(96) | $677  |
| Available-for-sale debt securities: |  |  |  |  |  |  |
| &nbsp;&nbsp;Taxable | (33) | 225  | 192  | (88) | 446  | 358  |
| &nbsp;&nbsp;Tax-exempt | (17) | 49  | 32  | (30) | 87  | 57  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total available-for-sale debt securities | (50) | 274  | 224  | (118) | 533  | 415  |
| Loans receivable: |  |  |  |  |  |  |
| &nbsp;&nbsp;Taxable | 365  | 196  | 561  | 778  | 583  | 1361  |
| &nbsp;&nbsp;Tax-exempt | (26) | 39  | 13  | 12  | 59  | 71  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total loans receivable | 339  | 235  | 574  | 790  | 642  | 1432  |
| Other earning assets | 9  | 0  | 9  | 13  | (2) | 11  |
| Total Interest Income | 698  | 448  | 1146  | 1458  | 1077  | 2535  |
| INTEREST-BEARING LIABILITIES |  |  |  |  |  |  |
| Interest-bearing deposits: |  |  |  |  |  |  |
| &nbsp;&nbsp;Interest checking | 139  | (267) | (128) | 257  | (464) | (207) |
| &nbsp;&nbsp;Money market | 141  | (110) | 31  | 91  | (259) | (168) |
| &nbsp;&nbsp;Savings | (3) | 0  | (3) | (9) | 0  | (9) |
| &nbsp;&nbsp;Time deposits | 280  | (210) | 70  | 875  | 180  | 1055  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total interest-bearing deposits | 557  | (587) | (30) | 1214  | (543) | 671  |
| Borrowed funds: |  |  |  |  |  |  |
| &nbsp;&nbsp;Short-term | (184) | (175) | (359) | (478) | (478) | (956) |
| &nbsp;&nbsp;Long-term - FHLB advances | (268) | 87  | (181) | (66) | 218  | 152  |
| &nbsp;&nbsp;Senior notes, net | 0  | 0  | 0  | 1  | 0  | 1  |
| &nbsp;&nbsp;Subordinated debt, net | 1  | 0  | 1  | 1  | 1  | 2  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total borrowed funds | (451) | (88) | (539) | (542) | (259) | (801) |
| Total Interest Expense | 106  | (675) | (569) | 672  | (802) | (130) |
| Net Interest Income | $592  | $1123  | $1715  | $786  | $1879  | $2665  |

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&nbsp;&nbsp;&nbsp;&nbsp;(1) Changes in income on tax-exempt securities and loans are presented on a fully taxable-equivalent basis, using the Corporation's marginal federal income tax rate of 21%.

&nbsp;&nbsp;&nbsp;&nbsp;(2) The change in interest due to both volume and rates has been allocated to volume and rate changes in proportion to the relationship of the absolute dollar amount of the change in each.

#### INCOME TAXES
The income tax provision in interim periods is based on the Corporation's estimate of the effective tax rate expected to be applicable for the full year. The income tax provision for the second quarter 2025 of $1,415,000 was $49,000 higher than the provision for the second quarter 2024, and the provision for the six months ended June 30, 2025 of $2,826,000 was $308,000 higher than the amount for the first six months of 2025 due to a higher amount of pre-tax income in 2025. The effective tax rate (tax provision as a percentage of pre-tax income) was 18.8% in the second quarter 2025 compared to 18.3% in the second quarter 2024 and 18.5% for the first six months of 2025 as compared to 18.1% for the first six months of 2024. The Corporation's effective tax rates differ from the statutory federal rate of 21% principally because of the effects of tax-exempt interest income, nondeductible interest expense, state income taxes and other permanent differences.

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
The Corporation recognizes deferred tax assets and liabilities based on differences between the consolidated financial statement carrying amounts and the tax basis of assets and liabilities. The net deferred tax asset at June 30, 2025 and December 31, 2024 represents the following temporary difference components:

---

| | | |
|:---|:---|:---|
|  | **June 30,**  | **December 31,**  |
| **(In Thousands)** | **2025** | **2024** |
| Deferred tax assets: |  |  |
| &nbsp;&nbsp;Unrealized holding losses on securities | $8748 | $10459 |
| &nbsp;&nbsp;Allowance for credit losses on loans | 4733 | 4400 |
| &nbsp;&nbsp;Purchase accounting adjustments on loans | 272 | 333 |
| &nbsp;&nbsp;Deferred compensation | 1556 | 1465 |
| &nbsp;&nbsp;Operating leases liability | 849 | 692 |
| &nbsp;&nbsp;Deferred loan origination fees | 676 | 697 |
| &nbsp;&nbsp;Net operating loss carryforward | 364 | 423 |
| &nbsp;&nbsp;Accrued incentive compensation | 342 | 678 |
| &nbsp;&nbsp;Other deferred tax assets | 1450 | 1520 |
| Total deferred tax assets | 18990 | 20667 |
| Deferred tax liabilities: |  |  |
| &nbsp;&nbsp;Right-of-use assets from operating leases | 849 | 692 |
| &nbsp;&nbsp;Core deposit intangibles | 407 | 456 |
| &nbsp;&nbsp;Bank premises and equipment | 278 | 290 |
| &nbsp;&nbsp;Defined benefit plans - ASC 835 | 95 | 90 |
| &nbsp;&nbsp;Other deferred tax liabilities | 15 | 41 |
| Total deferred tax liabilities | 1644 | 1569 |
| Deferred tax asset, net | $17346 | $19098 |

---

**The Corporation regularly reviews deferred tax assets for recoverability based on history of earnings, expectations for future earnings and expected timing of reversals of temporary differences. Realization of deferred tax assets ultimately depends on the existence of sufficient taxable income.**

**Management believes the recorded net deferred tax asset at June 30, 2025 is fully realizable; however, if management determines the Corporation will be unable to realize all or part of the net deferred tax asset, the Corporation would adjust the deferred tax asset, which would negatively impact earnings.**

#### SECURITIES
Management continually evaluates several objectives in determining the size, securities mix and other characteristics of the available-for-sale debt securities (investment) portfolio. Key objectives include supporting liquidity needs and maximizing return on earning assets within reasonable risk parameters.

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
The composition of the available-for-sale debt securities portfolio at June 30, 2025 and December 31, 2024, 2023 and 2022 is as follows:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **(Dollars In Thousands)** | **June 30, 2025** | **June 30, 2025** | **December 31, 2024** | **December 31, 2024** | **December 31, 2023** | **December 31, 2023** | **December 31, 2022** | **December 31, 2022** |
|  | **Amortized**<br>**Cost** | **Fair**<br>**Value** | **Amortized**<br>**Cost** | **Fair**<br>**Value** | **Amortized**<br>**Cost** | **Fair**<br>**Value** | **Amortized**<br>**Cost** | **Fair**<br>**Value** |
| Obligations of the U.S. Treasury | $8057 | 7374 | $8067 | 7118 | $12325 | 11290 | $35166 | $31836 |
| Obligations of U.S. Government agencies | 9790 | 8996 | 10154 | 9025 | 11119 | 9946 | 25938 | 23430 |
| Bank holding company debt securities | 28961 | 25767 | 28958  | 25246  | 28952  | 23500  | 28945  | 25386  |
| Obligations of states and political subdivisions: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Tax-exempt | 109330 | 97960 | 111995 | 101302 | 113464 | 104199 | 146149 | 132623 |
| &nbsp;&nbsp;Taxable | 50499 | 43218 | 51147 | 42506 | 58720 | 50111 | 68488 | 56812 |
| Mortgage-backed securities issued or guaranteed by U.S. Government agencies or sponsored agencies: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Residential pass-through securities  | 100257 | 93530 | 104378 | 94414 | 105549 | 95405 | 112782 | 99941 |
| &nbsp;&nbsp;Residential collateralized mortgage obligations | 53465 | 51129 | 53389 | 49894 | 50212 | 46462 | 44868 | 40296 |
| &nbsp;&nbsp;Commercial mortgage-backed securities | 74380 | 67008 | 73470 | 64501 | 76412 | 66682 | 91388 | 79686 |
| Private label commercial mortgage-backed securities | 5578 | 5580 | 8365  | 8374  | 8215  | 8160  | 8070  | 8023  |
| Asset-backed securities, |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;Collateralized loan obligations | 5500 | 5490 | 0  | 0  | 0  | 0  | 0  | 0  |
| Total Available-for-Sale Debt Securities | $445817 | $406052 | $449923 | $402380 | $464968 | $415755 | $561794 | $498033 |
| Aggregate Unrealized Loss |  | $(39765) |  | $(47543) |  | $(49213) |  | $(63761) |
| Aggregate Unrealized Loss as a % of Amortized Cost |  | (8.9)% |  | (10.6)% |  | (10.6)% |  | (11.3)% |

---

As reflected in the table above, the fair value of available-for-sale securities was lower than the amortized cost basis by $39,765,000, or 8.9% at June 30, 2025, $47,543,000, or 10.6%, at December 31, 2024, $49,213,000, or 10.6%, at December 31, 2023 and $63,761,000, or 11.3%, at December 31, 2022. The volatility in the fair value of the portfolio, including the reduction in fair value, resulted from changes in interest rates. The table also shows that the amortized cost basis of the portfolio has been reduced to $445,817,000 at June 30, 2025 from $561,794,000 at December 31, 2022 as proceeds from maturities and sales have been used to help fund loan growth and for other purposes.

Additional information regarding the potential impact of interest rate changes on all of the Corporation's financial instruments is provided in Item 3, Quantitative and Qualitative Disclosures about Market Risk.

As described in Note 5 to the unaudited consolidated financial statements, management determined the Corporation does not have the intent to sell, nor is it more likely than not that it will be required to sell, available-for-sale debt securities in an unrealized loss position at June 30, 2025 before it is able to recover the amortized cost basis. Further, management reviewed the Corporation's holdings as of June 30, 2025 and concluded there were no credit-related declines in fair value. Additional information related to the types of securities held at June 30, 2025, other than securities issued or guaranteed by U.S. Government entities or agencies, is as follows:

● Bank holding company debt securities – All of the Corporation's holdings of bank holding company debt securities were investment grade and there have been no payment defaults. There were seven securities with face amounts ranging from $3 million to $5 million, including one senior security and six subordinated securities. All of the issuers have publicly traded common stock . At June 30, 2025, the securities have external ratings ranging from BBB-/Baa3 to A-.

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● Obligations of states and political subdivisions (municipal bonds) –Most of the Corporation's holdings of municipal bonds were investment grade and there have been no payment defaults. Summary ratings information at June 30, 2025, based on the amortized cost basis and reflecting the lowest enhanced or underlying rating by Moody's, Standard & Poors or Fitch, is as follows: AAA or pre-refunded – 19% of the portfolio; AA – 74%; A – 7%.

● Private label commercial mortgage-backed securities (PLCMBS) – There were two PLCMBS securities, both of which were from the most senior payment (subordination) classes of their respective issuances. These securities were investment grade (rated Aaa), and there have been no payment defaults on these securities.

● Collateralized loan obligations (CLOs) – There were two CLOs securities, both of which were from the most senior payment (subordination) classes of their respective issuances. These securities were investment grade (rated Aaa), and there have been no payment defaults on these securities.

Based on the results of management's assessment, there was no ACL required on available-for-sale debt securities in an unrealized loss position at June 30, 2025.

#### FINANCIAL CONDITION
This section includes information regarding the Corporation's lending activities or other significant changes or exposures that are not otherwise addressed in Management's Discussion and Analysis. Significant changes in the average balances of the Corporation's earning assets and interest-bearing liabilities are described in the Net Interest Income section of Management's Discussion and Analysis. Other significant balance sheet items, including securities, the allowance for credit losses and stockholders' equity, are discussed in separate sections of Management's Discussion and Analysis. There are no significant concerns that have arisen related to the Corporation's off-balance sheet loan commitments or outstanding letters of credit at June 30, 2025.

Table VII shows the composition of the loan portfolio at June 30, 2025 and at year-end from 2020 through 2024. Throughout this time period, the portfolio was primarily commercial in nature. At June 30, 2025, commercial loans represented 76% of the portfolio while residential loans totaled 21% of the portfolio.

Also included in Table VII is additional detail regarding the composition of the non-owner occupied commercial real estate loan portfolio at June 30, 2025. As shown in Table VII, the amortized cost of non-owner occupied commercial real estate loans for which the primary purpose is utilization of office space by third parties was $118,007,000, or 6.1% of gross loans receivable. Within this segment there were two loans with a total amortized cost basis of $2,913,000 in nonaccrual status with no individual allowances and the remainder of the non-owner occupied commercial real estate loans with a primary purpose of office space utilization were in accrual status with no individual allowance at June 30, 2025.

While the Corporation's lending activities are primarily concentrated in its market areas, a portion of the Corporation's commercial loan segment consists of participation loans. Participation loans represent portions of larger commercial transactions for which other institutions are the "lead banks". Although not the lead bank, the Corporation conducts detailed underwriting and monitoring of participation loan opportunities. Total participation loans outstanding amounted to $33,756,000 at June 30, 2025, down from $35,129,000 at December 31, 2024.

The Corporation is a party to financial instruments with off-balance risk, including commitments to extend credit and standby letters of credit. At June 30, 2025, the total contract amount of commitments to extend credit was $408,779,000 as compared to $380,003,000 at December 31, 2024, and the contract amount of standby letters of credit was $65,258,000 at June 30, 2025 as compared to $64,586,000 at December 31, 2024.

The Corporation maintains an allowance for off-balance sheet credit exposures such as unfunded balances for existing lines of credit, commitments to extend future credit, commercial letters of credit and credit enhancement obligations related to residential mortgage loans sold with recourse, when there is a contractual obligation to extend credit and when this extension of credit is not unconditionally cancellable (i.e. commitment cannot be canceled at any time). The allowance for off-balance sheet credit exposures is adjusted as a provision for credit loss expense. The estimate includes consideration of the likelihood that funding will occur and an estimate of

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
expected credit losses on commitments expected to be funded over their estimated lives. The allowance for credit losses for off-balance sheet exposures of $742,000 at June 30, 2025 and $455,000 at December 31, 2024, is included in accrued interest and other liabilities in the unaudited consolidated balance sheets.

The Corporation originates and sells residential mortgage loans to the secondary market through the MPF Xtra program administered by the Federal Home Loan Banks of Pittsburgh and Chicago. Residential mortgages originated and sold through the MPF Xtra program consist primarily of conforming, prime loans sold to the Federal National Mortgage Association (Fannie Mae), a quasi-government entity. The Corporation also originates and sells residential mortgage loans to the secondary market through the MPF Original program, administered by the Federal Home Loan Banks of Pittsburgh and Chicago. Residential mortgages originated and sold through the MPF Original program consist primarily of conforming, prime loans sold to the Federal Home Loan Bank of Pittsburgh.

For loan sales originated under the MPF programs, the Corporation provides customary representations and warranties to investors that specify, among other things, that the loans have been underwritten to the standards established by the investor. The Corporation may be required to repurchase a loan and reimburse a portion of fees received or reimburse the investor for a credit loss incurred on a loan, if it is determined that the representations and warranties have not been met. Such repurchases or reimbursements generally result from an underwriting or documentation deficiency. At June 30, 2025, the total outstanding balance of loans the Corporation has repurchased as a result of identified instances of noncompliance amounted to $2,836,000, and the corresponding total outstanding balance of repurchased loans at December 31, 2024 was $3,029,000.

At June 30, 2025, outstanding balances of loans sold and serviced through the MPF Xtra and Original programs totaled $329,716,000, including loans sold through the MPF Xtra program of $154,352,000 and loans sold through the Original program of $175,364,000. At December 31, 2024, outstanding balances of loans sold and serviced through the MPF Xtra and Original programs totaled $329,766,000, including loans sold through the MPF Xtra program of $158,302,000 and loans sold through the Original program of $171,464,000. Based on the fairly limited volume of required repurchases to date, no allowance has been established for representation and warranty exposures as of June 30, 2025 and December 31, 2024.

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#### TABLE VII - SUMMARY OF LOANS BY TYPE

#### Summary of Loans by Type

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **(In Thousands)** | **June 30,**  | **December 31,**  | **December 31,**  | **December 31,**  | **December 31,**  | **December 31,**  |
|  | **2025** | **2024** | **2023** | **2022** | **2021** | **2020** |
| Commercial real estate - non-owner occupied: |  |  |  |  |  |  |
| &nbsp;&nbsp;Non-owner occupied | $488150 | $471171 | $499104 | $454386 | $358352 | $328662 |
| &nbsp;&nbsp;Multi-family (5 or more) residential | 107603 | 105174 | 64076 | 55406 | 49054 | 54893 |
| &nbsp;&nbsp;1-4 Family - commercial purpose | 162208 | 163220 | 174162 | 165805 | 175027 | 198918 |
| Total commercial real estate - non-owner occupied | 757961 | 739565 | 737342 | 675597 | 582433 | 582473 |
| Commercial real estate - owner occupied | 261157 | 261071 | 237246 | 205910 | 196083 | 191075 |
| All other commercial loans: |  |  |  |  |  |  |
| &nbsp;&nbsp;Commercial and industrial | 97632 | 96665 | 78832 | 95368 | 118488 | 222923 |
| &nbsp;&nbsp;Commercial lines of credit | 124515 | 120078 | 117236 | 141444 | 106338 | 105802 |
| &nbsp;&nbsp;Political subdivisions | 83811 | 94009 | 79031 | 86663 | 75401 | 46295 |
| &nbsp;&nbsp;Commercial construction and land | 99514 | 92741 | 104123 | 60892 | 59505 | 41000 |
| &nbsp;&nbsp;Other commercial loans | 25027 | 19784 | 20471 | 25710 | 26498 | 29310 |
| Total all other commercial loans | 430499 | 423277 | 399693 | 410077 | 386230 | 445330 |
| Residential mortgage loans: |  |  |  |  |  |  |
| &nbsp;&nbsp;1-4 Family - residential | 375352 | 383797 | 389262 | 363005 | 327593 | 356532 |
| &nbsp;&nbsp;1-4 Family residential construction | 23144 | 24212 | 24452 | 30577 | 23151 | 18736 |
| Total residential mortgage | 398496 | 408009 | 413714 | 393582 | 350744 | 375268 |
| Consumer loans: |  |  |  |  |  |  |
| &nbsp;&nbsp;Consumer lines of credit (including HELOCs) | 56130 | 47196 | 41503 | 36650 | 33522 | 34566 |
| &nbsp;&nbsp;All other consumer | 15015 | 16730 | 18641 | 18224 | 15837 | 15497 |
| Total consumer | 71145 | 63926 | 60144 | 54874 | 49359 | 50063 |
| Total | 1919258 | 1895848 | 1848139 | 1740040 | 1564849 | 1644209 |
| Less: allowance for credit losses on loans | (21699) | (20035) | (19208) | (16615) | (13537) | (11385) |
| Loans, net | $1897559 | $1875813 | $1828931 | $1723425 | $1551312 | $1632824 |

---

Additional details regarding the composition of the non-owner occupied commercial real estate loan portfolio, excluding multi-family (5 or more) residential and 1-4 Family-commercial purpose loans, at June 30, 2025 is as follows:

**NON-OWNER OCCUPIED COMMERCIAL REAL ESTATE**

---

| | | | |
|:---|:---|:---|:---|
| **(In Thousands)** | **June 30,**  | **% of Non-owner** | **% of** |
|  | **2025** | **Occupied CRE** | **Total Loans** |
| Office | $118007 | 24.2% | 6.1% |
| Retail | 89485 | 18.3% | 4.7% |
| Industrial | 83334 | 17.1% | 4.3% |
| Hotels | 69163 | 14.2% | 3.6% |
| Mixed Use | 60177 | 12.3% | 3.1% |
| Other | 67984 | 13.9% | 3.5% |
| Total Non-owner Occupied CRE Loans | $488150 |  |  |
| Total Gross Loans | $1919258 |  |  |

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

#### PROVISION AND ALLOWANCE FOR CREDIT LOSSES
A summary of the provision for credit losses for the three-month and six-months periods ended June 30, 2025 and 2024 is as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **(In Thousands)** | **3 Months** | **3 Months** | **6 Months** | **6 Months** |
|  | **Ended** | **Ended** | **Ended** | **Ended** |
|  | **June 30,**  | **June 30,**  | **June 30,**  | **June 30,**  |
|  | **2025** | **2024** | **2025** | **2024** |
| Provision for credit losses: |  |  |  |  |
| &nbsp;&nbsp;Loans receivable | $2075 | $566 | $2303 | $1526 |
| &nbsp;&nbsp;Off-balance sheet exposures  | 279 | (1) | 287 | (7) |
| Total provision for credit losses | $2354 | $565 | $2590 | $1519 |

---

For the quarter ended June 30, 2025, there was a provision for credit losses of $2,354,000, an increase of $1,789,000 from a provision for credit losses of $565,000 in the second quarter 2024. For the six months ended June 30, 2025, there was a provision for credit losses of $2,590,000, an increase of $1,071,000 compared to $1,519,000 in 2024. As described in more detail above, the provision in the six months ended June 30, 2025 included the impact of increases in the ACL related to changes in qualitative factors and an economic forecast. The allowance for credit losses ("ACL") was 1.13% of gross loans receivable at June 30, 2025, up from 1.06% at March 31, 2025 and December 31, 2024.

As shown in Table IX, the ACL on loans individually evaluated decreased to $9,000 at June 30, 2025 from $122,000 at December 31, 2024. At June 30, 2025, there were loans to one borrower with a total amortized cost basis of $239,000 for which individual ACLs were recorded. At December 21, 2024, the amortized cost basis of loans to the same borrower was $258,000.

Table IX also shows that, at June 30, 2025 as compared to December 31, 2024, the ACL related to collectively evaluated commercial loans increased by a total of $1,983,000 while the ACL on collectively evaluated consumer loans decreased $164,000 and the ACL on collectively evaluated residential mortgage loans decreased $42,000. The net increase in qualitative adjustments for commercial loans included an increase in a factor related to past due, nonaccrual and internally risk-rated loans and an increase related to changes in an economic forecast, partially offset by a decrease in WARM method estimated losses resulting mainly from a reduction in the estimated average life of the portfolio.

In the first six months of 2025, net charge-offs totaled $639,000, or 0.07% (annualized) of average outstanding loans. Table VIII shows annual average net charge-off rates over the prior five calendar years ranging from a high of 0.26% in 2022 to a low of 0.01% in 2023.

As presented in Table X, collateral dependent loans totaled $21,196,000 at June 30, 2025, down from $30,125,000 at December 31, 2024. The decrease from December 31, 2024 included two loans related to one relationship with a total amortized cost basis of $11,023,000 at December 31, 2024 that were paid off in April 2025.

Total nonperforming assets were $25,678,000 at June 30, 2025, up $1,536,000 from December 31, 2024. Nonperforming loans increased $1,348,000 from December 31, 2024. Table X shows that total nonperforming assets as a percentage of total assets was 0.98% at June 30, 2025, up from 0.92% at December 31, 2024. Table X also shows that total nonperforming assets as a percentage of assets as of year-end 2020 through 2024, ranged from a high of 1.10% at December 31, 2020 to a low of 0.75% at December 31, 2023.

Table X also shows that loans past due 30-89 days totaled $1,721,000 at June 30, 2025, down from $5,658,000 at December 31, 2024 as there was a net decrease of $3,791,000 in 1-4 Family residential loans past due 30-89 days from December 31, 2024.

Over the period 2020-2024 and the first 6 months of 2025, each period includes a few large commercial relationships that have required significant monitoring and workout efforts. As a result, a limited number of relationships may significantly impact the total amount of allowance required on individual loans and may significantly impact the provision for credit losses and the amount of total charge-offs reported in any one period.

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
Management believes it has been prudent in its decisions concerning identification of loans requiring individual evaluation for credit loss, estimates of loss, and nonaccrual status; however, the actual losses realized from these relationships could vary materially from the ACL calculated as of June 30, 2025. Management continues to closely monitor its commercial loan relationships for credit losses and will adjust its estimates of loss and decisions concerning nonaccrual status, if appropriate.

Tables VIII through X present historical data related to loans and the allowance for credit losses.

#### TABLE VIII - ANALYSIS OF THE ALLOWANCE FOR CREDIT LOSSES ON LOANS

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **(Dollars In Thousands)** | **Six Months Ended** | **Six Months Ended** |  |  |  |  |  |
|  | **June 30,**  | **June 30,**  | **Years Ended December 31,**  | **Years Ended December 31,**  | **Years Ended December 31,**  | **Years Ended December 31,**  | **Years Ended December 31,**  |
|  | **2025** | **2024** | **2024** | **2023** | **2022** | **2021** | **2020** |
| Balance, beginning of year | $20035 | $19208 | $19208 | $16615 | $13537 | $11385 | $9836 |
| Adoption of ASU 2016-13 (CECL) | 0  | 0  | 0  | 2104 | 0  | 0  | 0  |
| Charge-offs | (699) | (416) | (1716) | (356) | (4245) | (1575) | (2465) |
| Recoveries | 60 | 64 | 113 | 92 | 68 | 66 | 101 |
| Net charge-offs | (639) | (352) | (1603) | (264) | (4177) | (1509) | (2364) |
| Provision for credit losses on loans | 2303 | 1526 | 2430 | 753 | 7255 | 3661 | 3913 |
| Balance, end of period | $21699 | $20382 | $20035 | $19208 | $16615 | $13537 | $11385 |
| Net charge-offs as a % of average loans (annualized) | 0.07% | 0.04% | 0.09% | 0.01% | 0.26% | 0.09% | 0.16% |

---

#### TABLE IX - COMPONENTS OF THE ALLOWANCE FOR CREDIT LOSSES ON LOANS

---

| | | | | |
|:---|:---|:---|:---|:---|
| **(In Thousands)** | **June 30,**  | **December 31,** | **December 31,** | **January 1,** |
|  | **2025** | **2024** | **2023** | **2023** |
| Loans individually evaluated | $9 | $122 | $743 | $751 |
| Loans collectively evaluated: |  |  |  |  |
| &nbsp;&nbsp;Commercial real estate - nonowner occupied | 13093 | 11964 | 10379 | 9641 |
| &nbsp;&nbsp;Commercial real estate - owner occupied | 3046 | 2722 | 2111 | 1765 |
| &nbsp;&nbsp;All other commercial loans | 3891 | 3361 | 3811 | 3914 |
| &nbsp;&nbsp;Residential mortgage | 1314 | 1356 | 1764 | 2407 |
| &nbsp;&nbsp;Consumer | 346 | 510 | 400 | 241 |
| Total Allowance | $21699 | $20035 | $19208 | $18719 |

---

**PRIOR TO CECL ADOPTION**

---

| | | | |
|:---|:---|:---|:---|
| **(In Thousands)** | **As of December 31,**  | **As of December 31,**  | **As of December 31,**  |
|  | **2022** | **2021** | **2020** |
| ASC 310 - Impaired loans - individually evaluated | $453 | $740 | $925 |
| ASC 450 - Collectively evaluated: |  |  |  |
| &nbsp;&nbsp;Commercial | 10845 | 7553 | 5545 |
| &nbsp;&nbsp;Residential mortgage | 4073 | 4338 | 4091 |
| &nbsp;&nbsp;Consumer | 244 | 235 | 239 |
| &nbsp;&nbsp;Unallocated | 1000 | 671 | 585 |
| Total Allowance | $16615 | $13537 | $11385 |

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

#### TABLE X - PAST DUE LOANS AND NONPERFORMING ASSETS

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **(Dollars In Thousands)** | **June 30,**  | **As of December 31,**  | **As of December 31,**  | **As of December 31,**  | **As of December 31,**  | **As of December 31,**  |
|  | **2025** | **2024** | **2023** | **2022** | **2021** | **2020** |
| Collateral dependent loans with a valuation allowance | $239 | $258 | $7786 | $3460 | $6540 | $8082 |
| Collateral dependent loans without a valuation allowance | 20957 | 29867 | 3478 | 14871 | 2636 | 2895 |
| Purchased credit impaired loans | 0  | 0 | 0 | 1027 | 6558 | 6841 |
| Total collateral dependent loans | $21196 | $30125 | $11264 | $19358 | $15734 | $17818 |
| Total loans past due 30-89 days and still accruing | $1721 | $5658 | $9275 | $7079 | $5106 | $5918 |
| Nonperforming assets: |  |  |  |  |  |  |
| &nbsp;&nbsp;Purchased credit impaired loans | $0  | $0 | $0 | $1027 | $6558 | $6841 |
| &nbsp;&nbsp;Other nonaccrual loans | 25190 | 23842 | 15177 | 22058 | 12441 | 14575 |
| &nbsp;&nbsp;Total nonaccrual loans | 25190 | 23842 | 15177 | 23085 | 18999 | 21416 |
| &nbsp;&nbsp;Total loans past due 90 days or more and still accruing | 86 | 119 | 3190 | 2237 | 2219 | 1975 |
| &nbsp;&nbsp;Total nonperforming loans | 25276 | 23961 | 18367 | 25322 | 21218 | 23391 |
| &nbsp;&nbsp;Foreclosed assets held for sale (real estate) | 402 | 181 | 478 | 275 | 684 | 1338 |
| Total nonperforming assets | $25678 | $24142 | $18845 | $25597 | $21902 | $24729 |
| Total nonperforming loans as a % of loans | 1.32% | 1.26% | 0.99% | 1.46% | 1.36% | 1.42% |
| Total nonperforming assets as a % of assets | 0.98% | 0.92% | 0.75% | 1.04% | 0.94% | 1.10% |
| Nonaccrual loans as a % of loans | 1.31% | 1.26% | 0.82% | 1.33% | 1.21% | 1.30% |
| Allowance for credit losses as a % of nonaccrual loans | 86.14% | 84.03% | 79.01% | 71.97% | 71.25% | 53.16% |
| Allowance for credit losses as a % of total loans | 1.13% | 1.06% | 1.04% | 0.95% | 0.87% | 0.69% |

---

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

#### LIQUIDITY
Liquidity is the ability to quickly raise cash at a reasonable cost. An adequate liquidity position permits the Corporation to pay creditors, compensate for unforeseen deposit fluctuations and fund unexpected loan demand.

The Corporation maintains borrowing facilities with the Federal Home Loan Bank of Pittsburgh, secured by various mortgage loans. In addition, the Corporation maintains overnight borrowing facilities with several correspondent banks that provide a source of day-to-day liquidity.

The Corporation has a line of credit with the Federal Reserve Bank of Philadelphia's Discount Window. Management intends to use this line of credit as a contingency funding source. As collateral for the line, the Corporation has pledged available-for-sale debt securities with a carrying value of $18,305,000 at June 30, 2025.

The Corporation's outstanding, available, and total credit facilities at June 30, 2025 and December 31, 2024 are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Outstanding** | **Outstanding** | **Available** | **Available** | **Total Credit** | **Total Credit** |
| **(In Thousands)** | **June 30,**  | **December 31,**  | **June 30,**  | **December 31,**  | **June 30,**  | **December 31,**  |
|  | **2025** | **2024** | **2025** | **2024** | **2025** | **2024** |
| Federal Home Loan Bank of Pittsburgh | $165611 | $188692 | $780008 | $749999 | $945619 | $938691 |
| Federal Reserve Bank Discount Window | 0 | 0 | 17545 | 18093 | 17545 | 18093 |
| Other correspondent banks | 0 | 0 | 75000 | 75000 | 75000 | 75000 |
| Total credit facilities | $165611 | $188692 | $872553 | $843092 | $1038164 | $1031784 |

---

At June 30, 2025, the Corporation's outstanding credit facilities with the Federal Home Loan Bank of Pittsburgh consisted of long-term borrowings with par values totaling $143,894,000 and letters of credit totaling $21,717,000. At December 31, 2024, the Corporation's outstanding credit facilities with the Federal Home Loan Bank of Pittsburgh consisted of long-term borrowings with par values totaling $165,451,000 and letters of credit totaling $23,241,000. Additional information regarding borrowed funds is included in Note 8 to the unaudited consolidated financial statements.

Additionally, the Corporation uses "RepoSweep" arrangements to borrow funds from commercial banking customers on an overnight basis. If required to raise cash in an emergency situation, the Corporation could sell available-for-sale securities to meet its obligations or use repurchase agreements placed with brokers to borrow funds secured by investment assets. At June 30, 2025, the carrying value of available-for-sale securities in excess of amounts required to meet pledging or repurchase agreement obligations was $267,695,000.

Deposits totaled $2,109,776,000 at June 30, 2025, up $15,867,000 (0.8%) from $2,093,909,000 at December 31, 2024. Average total deposits were $66,641,000 or 3.3% higher for the six months ended June 30, 2025 as compared to the first six months of 2024 despite a reduction in average brokered deposits of $58,784,000. Brokered deposits, consisting of short-term certificates of deposit and money market funds, totaled $5,005,000 at June 30, 2025, a decrease of $19,016,000 from December 31, 2024.

As shown in the table below, at June 30, 2025, estimated uninsured deposits totaled $649.2 million, or 30.5% of total deposits, as compared to $632.8 million, or 30.0% of total deposits at December 31, 2024. Included in uninsured deposits are deposits collateralized by securities (almost exclusively municipal deposits) totaling $133.6 million at June 30, 2025. As shown in the table below, total uninsured and uncollateralized deposits amounted to 24.2% of total deposits at June 30, 2025, as compared to 22.3% at December 31, 2024.

As summarized in the table that immediately follows, the Corporation's highly liquid sources of available funds described above, including unused borrowing capacity with the Federal Home Loan Bank of Pittsburgh, unused availability on the Federal Reserve Bank of Philadelphia's discount window, available federal funds lines with other banks and unencumbered available-for-sale debt securities, totaled $1.1 billion at June 30, 2025. Available funding from these sources totaled 175.6% of uninsured deposits and 221.2% of total uninsured and uncollateralized deposits at June 30, 2025.

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

---

| | | |
|:---|:---|:---|
| **Uninsured Deposits Information** | **June 30,**  | **December 31,**  |
|  | **2025** | **2024** |
| Total Deposits - C&N Bank | $2127673 | $2111547 |
| Estimated Total Uninsured Deposits | $649184 | $632804 |
| Portion of Uninsured Deposits that are |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Collateralized | 133621 | 161958 |
| Uninsured and Uncollateralized Deposits | $515563 | $470846 |
| **Uninsured and Uncollateralized Deposits as** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;**a % of Total Deposits** | **24.2**% | **22.3**% |
| Available Funding from Credit Facilities | $872553 | $843092 |
| Fair Value of Available-for-sale Debt |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Securities in Excess of Pledging Obligations | 267695 | 236945 |
| Highly Liquid Available Funding | $1140248 | $1080037 |
| **Highly Liquid Available Funding as a % of** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;**Uninsured Deposits** | **175.6**% | **170.7**% |
| **Highly Liquid Available Funding as a % of** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;**Uninsured and Uncollateralized Deposits** | **221.2**% | **229.4**% |

---

Based on the ample sources of highly liquid funds as described above, management believes the Corporation is well-positioned to meet its short-term and long-term funding obligations.

#### STOCKHOLDERS' EQUITY AND CAPITAL ADEQUACY
In August 2018, the Federal Reserve Board issued an interim final rule that expanded applicability of the Board's small bank holding company capital adequacy policy statement. The interim final rule raised the policy statement's asset threshold from $1 billion to $3 billion in total consolidated assets for a bank holding company or savings and loan holding company that: (1) is not engaged in significant nonbanking activities; (2) does not conduct significant off-balance sheet activities; and (3) does not have a material amount of debt or equity securities, other than trust-preferred securities, outstanding. The interim final rule provides that, if warranted for supervisory purposes, the Federal Reserve may exclude a company from the threshold increase. Management believes the Corporation meets the conditions of the Federal Reserve's small bank holding company policy statement and is therefore excluded from consolidated capital requirements at June 30, 2025; however, management believes the Corporation will likely be subject to the consolidated capital requirements upon completion of the previously described acquisition of SQCF. Further, at June 30, 2025, C&N Bank remains subject to regulatory capital requirements administered by the federal banking agencies.

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
Details concerning capital ratios at June 30, 2025 and December 31, 2024 are presented below. Management believes, as of June 30, 2025, that C&N Bank meets all capital adequacy requirements to which it is subject and maintains a capital conservation buffer (described in more detail below) that allows C&N Bank to avoid limitations on capital distributions, including dividend payments and certain discretionary bonus payments to executive officers. For comparison purposes, the Corporation's capital ratios are presented along with those of C&N Bank in the table below. Further, as reflected in the table below, the Corporation's and C&N Bank's capital ratios at June 30, 2025 and December 31, 2024 exceed the Corporation's Board policy threshold levels.

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **(Dollars in Thousands)** |  |  |  |  |  |  | **Minimum To Be** | **Minimum To Be** |  |  |
|  |  |  |  |  | **Minimum To Maintain** | **Minimum To Maintain** | **Well** | **Well** |  |  |
|  |  |  | **Minimum** | **Minimum** | **Capital Conservation** | **Capital Conservation** | **Capitalized Under** | **Capitalized Under** | **Minimum To Meet** | **Minimum To Meet** |
|  |  |  | **Capital** | **Capital** | **Buffer at Reporting**  | **Buffer at Reporting**  | **Prompt Corrective** | **Prompt Corrective** | **the Corporation's** | **the Corporation's** |
|  | **Actual** | **Actual** | **Requirement** | **Requirement** | **Date** | **Date** | **Action Provisions** | **Action Provisions** | **Policy Thresholds** | **Policy Thresholds** |
|  | **Amount** | **Ratio** | **Amount** | **Ratio** | **Amount** | **Ratio** | **Amount** | **Ratio** | **Amount** | **Ratio** |
| **June 30, 2025:** |  |  |  |  |  |  |  |  |  |  |
| Total capital to risk-weighted assets: |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Consolidated | $310005 | 15.99% | N/A | N/A | N/A | N/A | N/A | N/A | $213253 | ≥11% |
| &nbsp;&nbsp;&nbsp;C&N Bank | 294320 | 15.21% | 154819 | ≥8% | 203200 | ≥10.5% | 193524 | ≥10% | 212877 | ≥11% |
| Tier 1 capital to risk-weighted assets: |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Consolidated | 262674 | 13.55% | N/A | N/A | N/A | N/A | N/A | N/A | 174480 | ≥9% |
| &nbsp;&nbsp;&nbsp;C&N Bank | 271878 | 14.05% | 116115 | ≥6% | 164496 | ≥8.5% | 154819 | ≥8% | 174172 | ≥9% |
| Common equity tier 1 capital to risk-weighted assets: |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Consolidated | 262674 | 13.55% | N/A | N/A | N/A | N/A | N/A | N/A | 145400 | ≥7.5% |
| &nbsp;&nbsp;&nbsp;C&N Bank | 271878 | 14.05% | 87086 | ≥4.5% | 135467 | ≥7.0% | 125791 | ≥6.5% | 145143 | ≥7.5% |
| Tier 1 capital to average assets: |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Consolidated | 262674 | 10.21% | N/A | N/A | N/A | N/A | N/A | N/A | 205818 | ≥8% |
| &nbsp;&nbsp;&nbsp;C&N Bank | 271878 | 10.62% | 102363 | ≥4% | N/A | N/A | 127954 | ≥5% | 204727 | ≥8% |
| **December 31, 2024:** |  |  |  |  |  |  |  |  |  |  |
| Total capital to risk-weighted assets: |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Consolidated | $302783 | 15.95% | N/A | N/A | N/A | N/A | N/A | N/A | $208779 | ≥11% |
| &nbsp;&nbsp;&nbsp;C&N Bank | 287721 | 15.19% | 151567 | ≥8% | 198832 | ≥10.5% | 189459 | ≥10% | 208405 | ≥11% |
| Tier 1 capital to risk-weighted assets: |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Consolidated | 257462 | 13.56% | N/A | N/A | N/A | N/A | N/A | N/A | 170819 | ≥9% |
| &nbsp;&nbsp;&nbsp;C&N Bank | 267231 | 14.10% | 113675 | ≥6% | 161040 | ≥8.5% | 151567 | ≥8% | 170513 | ≥9% |
| &nbsp;&nbsp;&nbsp;Common equity tier 1 capital to risk-weighted assets: |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Consolidated | 257462 | 13.56% | N/A | N/A | N/A | N/A | N/A | N/A | 142349 | ≥7.5% |
| &nbsp;&nbsp;&nbsp;C&N Bank | 267231 | 14.10% | 85256 | ≥4.5% | 132621 | ≥7.0% | 123148 | ≥6.5% | 142094 | ≥7.5% |
| Tier 1 capital to average assets: |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Consolidated | 257462 | 9.80% | N/A | N/A | N/A | N/A | N/A | N/A | 210160 | ≥8% |
| &nbsp;&nbsp;&nbsp;C&N Bank | 267231 | 10.23% | 104514 | ≥4% | N/A | N/A | 130642 | ≥5% | 209027 | ≥8% |

---

To avoid limitations on capital distributions, including dividend payments and certain discretionary bonus payments to executive officers, a banking organization subject to the rule must hold a capital conservation buffer composed of common equity tier 1 capital above its minimum risk-based capital requirements. The buffer is measured relative to risk-weighted assets. At June 30, 2025, the minimum risk-based capital ratios, and the capital ratios including the capital conservation buffer, are as follows:

---

| | |
|:---|:---|
| Minimum common equity tier 1 capital ratio | 4.5% |
| Minimum common equity tier 1 capital ratio plus capital conservation buffer | 7.0% |
| Minimum tier 1 capital ratio | 6.0% |
| Minimum tier 1 capital ratio plus capital conservation buffer | 8.5% |
| Minimum total capital ratio | 8.0% |
| Minimum total capital ratio plus capital conservation buffer | 10.5% |

---

A banking organization with a buffer greater than 2.5% over the minimum risk-based capital ratios would not be subject to additional limits on dividend payments or discretionary bonus payments; however, a banking organization with a buffer less than 2.5% would be subject to increasingly stringent limitations as the buffer approaches zero. Also, a banking organization is prohibited from making dividend payments or discretionary bonus payments if its eligible retained income is negative in that quarter and its capital conservation buffer ratio was less than 2.5% as of the beginning of that quarter. Eligible net income is defined as net income for the four calendar

[**Table of Contents**](#TOC)

quarters preceding the current calendar quarter, net of any distributions and associated tax effects not already reflected in net income. A summary of payout restrictions based on the capital conservation buffer is as follows:

---

| | |
|:---|:---|
| **Capital Conservation Buffer**<br>**(as a % of risk-weighted assets)** | **Maximum Payout**<br>**(as a % of eligible retained income)** |
| Greater than 2.5% | No payout limitation applies |
| ≤2.5% and >1.875% | 60% |
| ≤1.875% and >1.25% | 40% |
| ≤1.25% and >0.625% | 20% |
| ≤0.625% | 0% |

---

#### At June 30, 2025 , C&N Bank's Capital Conservation Buffer, determined based on the minimum total capital ratio, was 7.21%.
On September 25, 2023, the Corporation announced a treasury stock repurchase program. Under the program, the Corporation is authorized to repurchase up to 750,000 shares of the Corporation's common stock, or slightly less than 5% of the Corporation's issued and outstanding shares at August 4, 2023. The program was effective when publicly announced and will continue thereafter until suspended or terminated by the Board of Directors, in its sole discretion. All shares of common stock repurchased pursuant to the program will be held as treasury shares and be available for use and reissuance for purposes as and when determined by the Board of Directors including, without limitation, pursuant to the Corporation's Dividend Reinvestment and Stock Purchase and Sale Plan and its equity compensation program. For the three and six months ended June 30, 2025, there were no shares repurchased. At June 30, 2025, there were 723,966 shares available to be repurchased under the program.

Future dividend payments and repurchases of common stock will depend upon maintenance of a strong financial condition, future earnings and capital and regulatory requirements. In addition, the Corporation and C&N Bank are subject to restrictions on the amount of dividends that may be paid without approval of banking regulatory authorities. Further, although the Corporation is not currently subject to the specific consolidated capital requirements described herein, the Corporation's ability to pay dividends, repurchase stock or engage in other activities may be limited by the Federal Reserve if the Corporation fails to hold capital commensurate with its overall risk profile.

**The Corporation's total stockholders' equity is affected by fluctuations in the fair values of available-for-sale debt securities. The difference between amortized cost and fair value of available-for-sale debt securities, net of deferred income tax, is included in accumulated other comprehensive (loss) income within stockholders' equity. Accumulated other comprehensive (loss) income is excluded from the Bank's and the Corporation's regulatory capital ratios. The balance in accumulated other comprehensive loss related to unrealized losses on available-for-sale debt securities, net of deferred income tax, amounted to $31,017,000 at June 30, 2025 and $37,084,000 at December 31, 2024. Changes in accumulated other comprehensive loss are excluded from earnings and directly increase or decrease stockholders' equity. To the extent unrealized losses on available-for-sale debt securities result from credit losses, unrealized losses are recorded as a charge against earnings. The securities section of Management's Discussion and Analysis and Note 5 to the unaudited consolidated financial statements provide additional information concerning management's evaluation of available-for-sale debt securities for credit losses at June 30, 2025.**

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

#### ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
**MARKET RISK**

Market risk is the risk of loss arising from adverse changes in market rates and prices of the Corporation's financial instruments. In addition to the effects of interest rates, the market prices of the Corporation's available-for-sale debt securities are affected by fluctuations in the risk premiums (amounts of spread over risk-free rates) demanded by investors. Management attempts to limit the risk that economic conditions would force the Corporation to sell securities for realized losses by maintaining a strong capital position (discussed in the "Stockholders' Equity and Capital Adequacy" section of Management's Discussion and Analysis) and ample sources of liquidity (discussed in the "Liquidity" section of Management's Discussion and Analysis).

The Corporation's major category of market risk, interest rate risk, is discussed in the following section.

**INTEREST RATE RISK**

The Corporation uses a simulation model to calculate the potential effects of interest rate fluctuations on net interest income and the economic value of equity ("EVE"). For purposes of these calculations, EVE includes the discounted present values of financial instruments, such as securities, loans, deposits and borrowed funds, and the book values of nonfinancial assets and liabilities, such as premises and equipment and accrued expenses. The model measures and projects the amount of potential changes in net interest income and calculates the discounted present value of anticipated cash flows of financial instruments, assuming an immediate increase or decrease in interest rates. Management ordinarily runs a variety of scenarios within a range of plus or minus 100-400 basis points of current rates.

The projected results based on the model include the impact of estimates, at each level of interest rate change, regarding cash flows from principal repayments on loans and mortgage-backed securities and call activity on other investment securities. Further, the projected results are impacted by assumptions regarding the run-off and the extent of sensitivity to interest rate changes of deposits with no stated maturity (checking, savings and money market accounts). Actual results could vary significantly from these estimates, which could result in significant differences in the calculations of projected changes in net interest income and EVE. Also, the model does not make estimates related to changes in the composition of the deposit portfolio that could occur due to rate competition, and the table does not necessarily reflect changes that management would make to realign the portfolio as a result of changes in interest rates.

The Corporation's Board of Directors has established policy guidelines for acceptable levels of interest rate risk, based on an immediate increase or decrease in interest rates. The policy limits acceptable fluctuations in net interest income from the baseline (flat rates) one-year scenario and variances in EVE from the baseline values based on current rates.

Table XI, which follows this discussion, is based on the results of calculations performed using the simulation model as of June 30, 2025 and December 31, 2024. The Table shows that as of the respective dates, the changes in net interest income and changes in economic value of equity were within the policy limits in all scenarios.

Based on June 30, 2025 and December 31, 2024 data, the amounts of net interest income decrease, as compared to the amounts based on current interest rates, in both the upward and downward rate scenarios. Similarly, at June 30, 2025 and December 31, 2024, EVE is modeled to decrease compared to the 0 basis point scenario in all of the rising and falling rate scenarios The modeling results reflect the impact of management's assumptions that the Corporation's deposit rates would rise in the increasing rate scenarios to a greater extent than they would fall in the decreasing rate scenarios. Further, results in the downward rate scenarios reflect limitations on the benefit of falling rates on some deposit types due to a 0% assumed floor.

Under U.S. generally accepted accounting principles, available-for-sale debt securities are carried at fair value as of each balance sheet date. The difference between amortized cost and fair value of available-for-sale debt securities, net of deferred income tax, is included in accumulated other comprehensive income (loss) within stockholders' equity. Increases in interest rates have caused the fair value of the Corporation's available-for-sale debt securities to decrease, resulting in an accumulated other comprehensive loss related to securities of $31.0 million at June 30, 2025. In contrast, most of the Corporation's other financial instruments, including loans receivable (held for investment), deposits and borrowed funds are carried on the balance sheet at historical cost without adjustment for the impact of changes in interest rates.

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
**TABLE XI – THE EFFECT OF HYPOTHETICAL CHANGES IN INTEREST RATES**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Period Ending June 30, 2026** | **Period Ending June 30, 2026** | **Period Ending June 30, 2026** | **Period Ending June 30, 2026** | **Period Ending June 30, 2026** |
| **June 30, 2025 Data**<br>**(In Thousands)**<br>**Basis Point**<br>**Change in Rates** | **Interest**<br>**Income** | **Interest**<br>**Expense** | **Net Interest**<br>**Income (NII)** | **NII**<br>**% Change** | **NII**<br>**Risk Limit** |
| +400 | $158951 | 82212 | $76739 | (15.8)% | 25.0% |
| +300 | 153086 | 70869 | 82217 | (9.8)% | 20.0% |
| +200 | 147169 | 60715 | 86454 | (5.1)% | 15.0% |
| +100 | 141179 | 51749 | 89430 | (1.9)% | 10.0% |
| 0 | 135114 | 43972 | 91142 | 0.0% | 0.0% |
| -100 | 129145 | 39810 | 89335 | (2.0)% | 10.0% |
| -200 | 122250 | 35691 | 86559 | (5.0)% | 15.0% |
| -300 | 114537 | 31571 | 82966 | (9.0)% | 20.0% |
| -400 | 106143 | 27501 | 78642 | (13.7)% | 25.0% |
|  | **Economic Value of Equity at June 30, 2025** | **Economic Value of Equity at June 30, 2025** | **Economic Value of Equity at June 30, 2025** |  |  |
|  | **Present** | **Present** | **Present** |  |  |
| **Basis Point** | **Value** | **Value** | **Value** |  |  |
| **Change in Rates** | **Equity** | **% Change** | **Risk Limit** |  |  |
| +400 | $507282 | (13.3)% | 50.0% |  |  |
| +300 | 536827 | (8.2)% | 45.0% |  |  |
| +200 | 561453 | (4.0)% | 35.0% |  |  |
| +100 | 578686 | (1.0)% | 25.0% |  |  |
| 0 | 584823 | 0.0% | 0.0% |  |  |
| -100 | 561731 | (3.9)% | 25.0% |  |  |
| -200 | 524442 | (10.3)% | 35.0% |  |  |
| -300 | 469866 | (19.7)% | 45.0% |  |  |
| -400 | 403652 | (31.0)% | 50.0% |  |  |

---

[**Table of Contents**](#TOC)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Period Ending December 31, 2025** | **Period Ending December 31, 2025** | **Period Ending December 31, 2025** | **Period Ending December 31, 2025** | **Period Ending December 31, 2025** |
| **December 31, 2024 Data**<br>**(In Thousands)**<br>**Basis Point**<br>**Change in Rates** | **Interest**<br>**Income** | **Interest**<br>**Expense** | **Net Interest**<br>**Income (NII)** | **NII**<br>**% Change** | **NII**<br>**Risk Limit** |
| +400 | $157710 | 87489 | $70221 | (17.4)% | 25.0% |
| +300 | 151610 | 75796 | 75814 | (10.8)% | 20.0% |
| +200 | 145458 | 65308 | 80150 | (5.7)% | 15.0% |
| +100 | 139233 | 56023 | 83210 | (2.1)% | 10.0% |
| 0 | 132939 | 47942 | 84997 | 0.0% | 0.0% |
| -100 | 126757 | 42671 | 84086 | (1.1)% | 10.0% |
| -200 | 119814 | 37450 | 82364 | (3.1)% | 15.0% |
| -300 | 111964 | 32229 | 79735 | (6.2)% | 20.0% |
| -400 | 103390 | 27650 | 75740 | (10.9)% | 25.0% |
|  | **Economic Value of Equity at December 31, 2024** | **Economic Value of Equity at December 31, 2024** | **Economic Value of Equity at December 31, 2024** |  |  |
|  | **Present** | **Present** | **Present** |  |  |
| **Basis Point** | **Value** | **Value** | **Value** |  |  |
| **Change in Rates** | **Equity** | **% Change** | **Risk Limit** |  |  |
| +400 | $475112 | (16.1)% | 50.0% |  |  |
| +300 | 507221 | (10.4)% | 45.0% |  |  |
| +200 | 534636 | (5.6)% | 35.0% |  |  |
| +100 | 555058 | (2.0)% | 25.0% |  |  |
| 0 | 566339 | 0.0% | 0.0% |  |  |
| -100 | 552813 | (2.4)% | 25.0% |  |  |
| -200 | 520196 | (8.1)% | 35.0% |  |  |
| -300 | 470155 | (17.0)% | 45.0% |  |  |
| -400 | 403255 | (28.8)% | 50.0% |  |  |

---

#### ITEM 4. CONTROLS AND PROCEDURES
The Corporation's management, under the supervision of and with the participation of the Corporation's Chief Executive Officer and Chief Financial Officer, has carried out an evaluation of the design and effectiveness of the Corporation's disclosure controls and procedures as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Securities Exchange Act of 1934 as of the end of the period covered by this report. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Corporation's disclosure controls and procedures are effective to ensure that all material information required to be disclosed in reports the Corporation files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms.

There were no significant changes made to the Corporation's internal control over financial reporting that occurred during the period covered by this report that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

#### PART II – OTHER INFORMATION

#### Item 1. &nbsp;&nbsp;&nbsp;&nbsp; Legal Proceedings
The information provided in Note 10 of the Consolidated Unaudited Financial Statements is hereby incorporated into this Part II, Item 1 by reference.

#### Item 1A. Risk Factors
Except for the risk factor described immediately below, there have been no material changes from the risk factors previously disclosed in Item 1A of the Corporation's Annual Report on Form 10-K filed March 6, 2025.

**Risk Related to Pending Acquisition of SQCF** - The success of the acquisition will depend, in part, on the Corporation's ability to realize the anticipated benefits and cost savings from successfully combining the businesses of the Corporation and SQCF within the Corporation's projected timeframe. If the Corporation is not able to achieve these objectives, the anticipated benefits and cost savings of the acquisition may not be realized fully or at all, or may take longer to realize than expected. The Corporation and SQCF have operated and, until the completion of the merger, will continue to operate, independently. It is possible that the integration process could result in the loss of key employees, the disruption of ongoing businesses or inconsistencies in standards, controls, procedures and policies that adversely affect the Corporation's ability to maintain relationships with clients, customers, depositors and employees or to achieve the anticipated benefits of the acquisition. Integration efforts between the two companies will also divert management attention and resources. These integration matters could have an adverse effect on the Corporation during the transition period.

The Corporation expects to incur substantial expenses in connection with the acquisition, including computer system conversion costs, severance, professional fees and other expenses. The Corporation cannot identify the timing, nature and amount of all such charges as of the date of this filing. The completion of the acquisition depends on the satisfaction of specified conditions, many of which are outside of the Corporation's control, including the receipt of regulatory approvals and approval of the transaction by SQCF shareholders. If the acquisition is not completed, these expenses would have been expended or would be recognized currently and not capitalized, and the Corporation would not have realized the expected benefits of the acquisition. Additionally, the Corporation's business may be adversely impacted by the failure to pursue other beneficial opportunities due to the focus of management on the acquisition, without realizing any of the anticipated benefits of completing the acquisition.

***The acquisition may not be accretive, and may be dilutive, to the Corporation's earnings per share, which may negatively affect the market price of the Corporation's common stock.***

The Corporation currently expects the acquisition to be accretive to earnings per share beginning in the first year after closing (excluding one-time charges). This expectation, however, is based on preliminary estimates which may materially change, including the currently expected timing of the acquisition. The Corporation may encounter additional transaction and integration related costs or other factors, such as a delay in the closing of the acquisition, failure to realize all of the benefits anticipated in the acquisition or other factors that affect preliminary estimates or the Corporation's ability to realize operational efficiencies. Any of these factors could cause a decrease in the Corporation's earnings per share or decrease or delay the expected accretive effect of the acquisition and contribute to a decrease in the price of the Corporation's common stock.

#### Item 2. &nbsp;&nbsp;&nbsp;&nbsp; Unregistered Sales of Equity Securities and Use of Proceeds
Issuer Purchases of Equity Securities

On September 25, 2023, the Corporation announced a treasury stock repurchase program. Under the approved program, the Corporation is authorized to repurchase up to 750,000 shares of the Corporation's common stock, or slightly less than 5% of the Corporation's issued and outstanding shares at August 4, 2023. The program was effective when publicly announced and

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q
will continue thereafter until suspended or terminated by the Board of Directors, in its sole discretion. All shares of common stock repurchased pursuant to the program shall be held as treasury shares and be available for use and reissuance for purposes as and when determined by the Board of Directors including, without limitation, pursuant to the Corporation's Dividend Reinvestment and Stock Purchase and Sale Plan and its equity compensation program. There were no shares repurchased under the repurchase program during the second quarter 2025. At June 30, 2025, there were 723,966 shares available to be repurchased under the program.

The following table sets forth a summary of purchases by the Corporation, in the open market, of its equity securities during the second quarter 2025:

---

| | | | | |
|:---|:---|:---|:---|:---|
| <br>**Period** | <br>**Total Number**<br>**of Shares**<br>**Purchased** | <br>**Average**<br>**Price Paid**<br>**per Share** | **Total Number of**<br>**Shares**<br>**Purchased**<br>**as Part of**<br>**Publicly**<br>**Announced**<br>**Plans**<br>**or Programs** | **Maximum**<br>**Number of**<br>**Shares that May**<br>**Yet**<br>**be Purchased**<br>**Under**<br>**the Plans or**<br>**Programs** |
| April 1 - 30, 2025 | 0 | $0 | 0 | 723966 |
| May 1 - 31, 2025 | 0 | $0 | 0 | 723966 |
| June 1 - 30, 2025 | 0 | $0 | 0 | 723966 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total | 0 | $0 | 0 |  |

---

#### Item 3. &nbsp;&nbsp;&nbsp;&nbsp; Defaults Upon Senior Securities
None

#### Item 4. &nbsp;&nbsp;&nbsp;&nbsp; Mine Safety Disclosures
Not applicable

#### Item 5.&nbsp;&nbsp;&nbsp;&nbsp; Other Information
**The table below details the directors or executive officers for whom a written plan for the purchase of the Corporation's common stock that is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) became effective in the second quarter 2025.**

---

| | | | |
|:---|:---|:---|:---|
| **Name** | **Title** | **Effective date** | **Expiration date** |
| Katherine W. Shattuck | Director | May 1, 2025 | April 30, 2026 |
| Frank G. Pellegrino | Director | May 1, 2025 | April 30, 2026 |

---

**The written plan provides for the directors to receive designated fees for their service as directors in the form of the Corporation's common stock to be purchased in the open market by the Corporation's transfer agent. Each of the directors identified above asserted they were not aware of material nonpublic information about the Corporation or its common stock at the time they adopted the written plan.**

Except as noted above, during the three months ended June 30, 2025, no director or officer of the Corporation adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement", as each term is defined in Item 408(a) of Regulation S-K.

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

#### Item 6. &nbsp;&nbsp;&nbsp;&nbsp; Exhibits

---

| | | |
|:---|:---|:---|
| Agreement and Plan of Merger dated April 23, 2025 between Susquehanna Community Financial, Inc. and Citizens & Northern Corporation<br>|  |  |
| 2.1 | [Agreement and Plan of Merger dated April 23, 2025 between Susquehanna Community Financial, Inc. and Citizens & Northern Corporation](https://www.sec.gov/Archives/edgar/data/810958/000155837025005276/cznc-20250423xex2d1.htm) | Incorporated by reference to Exhibit 2.1 of the Corporation's Form 8-K filed April 23, 2025 |
| 3.1 | [Articles of Incorporation](https://www.sec.gov/Archives/edgar/data/0000810958/000155837022007537/cznc-20220331xex3d1.htm) | Incorporated by reference to Exhibit 3.1 of the Corporation's Form 10-Q filed May 6, 2022 |
| 3.2 | [By-laws](https://www.sec.gov/Archives/edgar/data/0000810958/000155837022001422/cznc-20220217xex3d1.htm) | Incorporated by reference to Exhibit 3.1 of the Corporation's Form 8-K filed February 18, 2022 |
| 31. | Rule 13a-14(a)/15d-14(a) certifications: |  |
| 31.1  | [Certification of Chief Executive Officer](cznc-20250630xex31d1.htm) | Filed herewith |
| 31.2  | [Certification of Chief Financial Officer](cznc-20250630xex31d2.htm) | Filed herewith |
| 32.  | [Section 1350 certifications](cznc-20250630xex32.htm) | Filed herewith |
| 101.INS | Inline XBRL Instance Document. | Filed herewith |
| 101.SCH | Inline XBRL Schema Document. | Filed herewith |
| 101.CAL | Inline XBRL Calculation Linkbase Document. | Filed herewith |
| 101.DEF | Inline XBRL Definition Linkbase Document. | Filed herewith |
| 101.LAB | Inline XBRL Label Linkbase Document. | Filed herewith |
| 101.PRE | Inline XBRL Presentation Linkbase Document. | Filed herewith |
| 104 | The cover page of the Corporation's Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, formatted in Inline XBRL (contained in Exhibit 101). | Filed herewith |

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#### CITIZENS & NORTHERN CORPORATION – FORM 10-Q

#### SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | |
|:---|:---|
|  | CITIZENS & NORTHERN CORPORATION |
| August 8, 2025 | By: /s/ J. Bradley Scovill |
| Date | President and Chief Executive Officer |
| August 8, 2025 | By: /s/ Mark A. Hughes |
| Date | Treasurer and Chief Financial Officer |

---

## Exhibit 31.1

**Exhibit 31.1**

**CERTIFICATION**

I, J. Bradley Scovill, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. I have reviewed this quarterly report on Form 10-Q of Citizens & Northern Corporation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The registrant ' s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) evaluated the effectiveness of the registrant ' s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) disclosed in this report any change in the registrant ' s internal control over financial reporting that occurred during the registrant ' s most recent fiscal quarter (the registrant ' s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant ' s internal control over financial reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. The registrant ' s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant ' s auditors and the audit committee of registrant ' s board of directors (or persons performing the equivalent function):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant ' s ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant ' s internal control over financial reporting.

---

| | | |
|:---|:---|:---|
| <u>August 8, 2025</u> | By:  | <u>/s/ J. Bradley Scovill</u> |
| Date |  | President and Chief Executive Officer |

---

------

## Exhibit 31.2

**Exhibit 31.2**

**CERTIFICATION**

I, Mark A. Hughes, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. I have reviewed this quarterly report on Form 10-Q of Citizens & Northern Corporation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The registrant ' s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) evaluated the effectiveness of the registrant ' s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) disclosed in this report any change in the registrant ' s internal control over financial reporting that occurred during the registrant ' s most recent fiscal quarter (the registrant ' s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant ' s internal control over financial reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. The registrant ' s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant ' s auditors and the audit committee of registrant ' s board of directors (or persons performing the equivalent function):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant ' s ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant ' s internal control over financial reporting.

---

| | | |
|:---|:---|:---|
| <u>August 8, 2025</u> | By:<u> </u> | <u>/s/ Mark A. Hughes</u> |
| Date |  | Treasurer and Chief Financial Officer |

---

------

## Ex-32

**Exhibit 32**

**SECTION 1350 CERTIFICATIONS**

In connection with the Quarterly Report of Citizens & Northern Corporation (the "Corporation") on Form 10-Q for the quarterly period ended June 30, 2025, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned hereby certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that to each of the undersigned's best knowledge and belief:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 as amended; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

---

| | | |
|:---|:---|:---|
| <u>August 8, 2025</u> | By:  | <u>/s/ J. Bradley Scovill</u> |
| Date |  | President and Chief Executive Officer |
| <u>August 8, 2025</u> | By:  | <u>/s/ Mark A. Hughes</u> |
| Date |  | Treasurer and Chief Financial Officer |

---

These certifications accompany this report on Form 10-Q pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by such Act, be deemed filed by the Corporation for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Such certifications will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Corporation specifically incorporates them by reference.

A signed original of this written statement required by Section 906 has been provided to the Corporation and will be retained by the Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

------