CB Financial Services, Inc. Announces Second Quarter and Year-to-Date 2022 Financial Results and Declares Quarterly Cash Dividend

WASHINGTON, Pa--(BUSINESS WIRE)--CB Financial Services, Inc. (“CB” or the “Company”) (NASDAQGM: CBFV), the holding company of Community Bank (the “Bank”) and Exchange Underwriters, Inc. (“EU”), a wholly-owned insurance subsidiary of the Bank, today announced its second quarter and year-to-date 2022 financial results.

	Three Months Ended													Six Months Ended
	6/30/22		3/31/22		12/31/21			9/30/21			6/30/21			6/30/22		6/30/21
(Dollars in thousands, except per share data) (Unaudited)
Net Income (Loss) (GAAP)	$	118	$	3,047	$	6,965		$	1,983		$	(223	)	$	3,165	$	2,622
Non-Recurring Items		157		12		(4,122	)		(17	)		3,440			169		3,087
Adjusted Net Income (Non-GAAP) ^(1)	$	275	$	3,059	$	2,843		$	1,966		$	3,217		$	3,334	$	5,709
Earnings (Loss) per Common Share - Diluted (GAAP)	$	0.02	$	0.58	$	1.31		$	0.37		$	(0.04	)	$	0.61	$	0.48
Adjusted Earnings per Common Share - Diluted (Non-GAAP) ^(1)	$	0.05	$	0.59	$	0.53		$	0.36		$	0.59		$	0.64	$	1.05

(1) Refer to Explanation of Use of Non-GAAP Financial Measures and reconciliation of net income (loss) and adjusted earnings per common share - diluted in this Press Release.

2022 Second Quarter Financial Highlights

(Comparisons to three months ended June 30, 2021 unless otherwise noted)

• Net income was $118,000, compared to a net loss of $223,000. Current period results were negatively impacted by provision expense of approximately $3.8 million driven, largely, by a loan charge-off of $2.7 million while the prior year period included an intangible asset impairment and asset write down of $3.4 million, associated with the Company’s optimization program. Current period results were aided by the completion of the Company’s optimization program in 2021, which resulted in a reduction of noninterest expense of $1.9 million for the three months ended June 30, 2022 compared to the three months ended June 30, 2021 (excluding noninterest expense of $3.4 million related to intangible impairment and fixed asset write-down).
  • Adjusted net income (non-GAAP) was $275,000, compared to $3.2 million.
• Earnings per diluted common share (EPS) increased to $0.02 from loss per diluted common share of $0.04.
  • Adjusted earnings per common share - diluted (non-GAAP) was $0.05, compared to $0.59.
• Return on average assets (annualized) of 0.03%, compared to loss on average assets (annualized) of 0.06%.
  • Adjusted return on average assets (annualized) (non-GAAP) of 0.08%, compared to 0.87%.
• Return on average equity (annualized) of 0.40%, compared to loss on average equity (annualized) of 0.66%.
  • Adjusted return on average equity (annualized) (non-GAAP) of 0.93%, compared to 9.57%.
• Net interest margin (NIM) improved to 3.12% from 2.84%.
• Net interest and dividend income was $10.2 million, compared to $9.9 million.
• Noninterest income decreased to $2.1 million, compared to $2.2 million. The most significant change in noninterest income was a $210,000 reduction in securities gains resulting from mark-to-market accounting, partially offset by an increase of $160,000 in insurance commissions. The increase in insurance commissions was primarily driven by contingency income which resulted from the higher than lock-in amounts received and core business including commercial and personal insurance lines.

(Amounts at June 30, 2022; comparisons to December 31, 2021, unless otherwise noted)

• Total loans, including Payroll Protection Program (“PPP”) loans, were $1.03 billion, an increase of $7.2 million from $1.02 billion.
  • Total loans held for investment, excluding PPP loans, increased $27.8 million, or 5.6% annualized, to $1.02 billion compared to $996.3 million, and included increases of $26.8 million, or 44.2% annualized, in consumer loans, and $34.0 million, or 17.6% annualized, growth in commercial real estate loans, partially offset by decreases in construction real estate and commercial and industrial loans. Compared to June 30, 2021, loans held for investment, excluding PPP loans, increased $66.2 million, or 6.9%, primarily from increases of $65.6 million in commercial real estate loans and $42.5 million in consumer loans as noted above, partially offset by decreases of $43.9 million in construction real estate loans and $8.6 million in commercial and industrial loans.
• Nonperforming loans to total loans was 0.57%, a decrease of 14 basis points (“bps”), compared to 0.71%.
• Total deposits were $1.22 billion, a decrease of $11.4 million, compared to $1.23 billion.
• Total assets decreased by $39 million to $1.39 billion, compared to $1.43 billion.
• Book value per share was $22.18, compared to $23.69 as of March 31, 2022 and $25.31 as of December 31, 2021.
  • Tangible book value per share (Non-GAAP) decreased to $19.43, compared to $20.86 as of March 31, 2022 and $22.45 as of December 31, 2021, reflecting impact to Accumulated Other Comprehensive Income from unrealized losses on securities portfolios.

Management Commentary

President and CEO John H. Montgomery stated, “Despite the looming macroeconomic uncertainty, we are optimistic about our business for a number of reasons. Our core earnings, as measured by pre-tax, pre-provision income, are accelerating and that is due primarily to the steps we took in 2021 to optimize our operations, coupled with growth investments we have made this year. Continuing the trend we saw in the first quarter, second quarter results included further loan growth, led by consumer and commercial real estate loans, and a lower noninterest expense run rate. Underpinning our growth is a stable, low volatility metropolitan service area anchored by leading higher education institutions and major healthcare companies, in addition to a strong technology presence.”

Mr. Montgomery continued, “As we reported on June 6th, we incurred a $2.7 million charge-off associated with a loan to a long-time customer that unexpectedly decided to wind down their operations. Although the charge negatively impacted our results in the quarter, a subsequent examination of our entire credit portfolio confirmed our view that this was an isolated event. We also believe our senior leadership team, and our credit management team in particular, is a key asset, as they delivered outstanding performance during the recessionary period from 2008 to 2010. During that period, we did not need to take a government TARP loan and our total credit losses during the period were less than $5.0 million. That experience allows us to face the current economic headwinds with confidence that we can not only adeptly manage our credit risk but also continue to grow our core earnings. During the second quarter we furthered our commitment to CB shareholders as we announced a new $10.0 million share repurchase program, in addition to our regular quarterly dividend. We remain well-capitalized with the ability to support growth along with these shareholder-friendly actions.”

Dividend Information

The Company’s Board of Directors has declared a $0.24 quarterly cash dividend per outstanding share of common stock, payable on or about August 31, 2022, to stockholders of record as of the close of business on August 19, 2022.

Stock Repurchase Program

On April 21, 2022, CB announced a program to repurchase up to $10.0 million of the Company’s outstanding shares of common stock. Based on the Company’s closing stock price on July 26, 2022, the repurchase program, if fully completed, would encompass 428,082 shares, or approximately 8.3% of the shares currently outstanding.

2022 Second Quarter Financial Review

Net Interest and Dividend Income

Net interest and dividend income increased $229,000, or 2.3%, to $10.2 million for the three months ended June 30, 2022 compared to $9.9 million for the three months ended June 30, 2021.

• Net interest margin (GAAP) increased to 3.12% for the three months ended June 30, 2022 compared to 2.84% for the three months ended June 30, 2021. Net interest margin (FTE) (Non-GAAP) increased 28 bps to 3.13% for the three months ended June 30, 2022 compared to 2.85% for the three months ended June 30, 2021.
• Interest and dividend income increased $138,000, or 1.3%, to $11.0 million for the three months ended June 30, 2022 compared to $10.8 million for the three months ended June 30, 2021.
  • Interest income on loans decreased $203,000, or 2.0%, to $9.7 million for the three months ended June 30, 2022 compared to $9.9 million for the three months ended June 30, 2021. The average balance of loans decreased $9.0 million to $1.01 billion from $1.02 billion and the average yield decreased 5 bps to 3.88% compared to 3.93%. Interest and fee income on PPP loans was $144,000 for the three months ended June 30, 2022 and contributed 4 bps to loan yield, compared to $636,000 for the three months ended June 30, 2021, which contributed 3 bps to loan yield. The impact of the accretion of the credit mark on acquired loan portfolios was $75,000 for the three months ended June 30, 2022 compared to $153,000 for the three months ended June 30, 2021, or 3 bps in the current period compared to 6 bps in the prior period. 
  • Interest income on taxable investment securities increased $353,000, or 55.6%, to $988,000 for the three months ended June 30, 2022 compared to $635,000 for the three months ended June 30, 2021 driven by a $103.6 million increase in average balance partially offset by a 31 bps decrease in average yield.
• Interest expense decreased $91,000, or 10.3%, to $795,000 for the three months ended June 30, 2022 compared to $886,000 for the three months ended June 30, 2021.
  • Interest expense on deposits decreased $223,000, or 27.0%, to $604,000 for the three months ended June 30, 2022 compared to $827,000 for the three months ended June 30, 2021. While average interest-earning deposit balances decreased $74.5 million, or 8%, from $900.1 million as of June 30, 2021 compared to $825.6 million as of June 30, 2022, controlling the deposit cost structure combined with non-renewal or repricing of higher-cost time deposit resulted in a 8 bps, or 21.7%, decrease in average cost compared to the three months ended June 30, 2021. In addition, the average balance of time deposits and the related average cost decreased $49.7 million and 24 bps, respectively. These decreases are partially offset by a 9 bps increase in interest-bearing demand deposit average cost as well as an increase in average other borrowings of $11.6 million or 193.5% to $17.6 million as of June 30, 2022 compared to $6.0 million as of June 30, 2021, which was driven by an increase in subordinated debt balance.

Provision for Loan Losses

There was $3.8 million provision for loan losses for the three months ended June 30, 2022 compared with a recovery of $1.2 million for the three months ended June 30, 2021. The increased provision for loan losses was primarily due to a provision for a single loan charge-off of $2.7 million (pre-tax) with respect to a commercial and industrial loan. As previously reported, the charge-off relates to a borrower which is ceasing operations and carried a $3.5 million revolving line of credit which had an outstanding balance of $2.7 million. The remaining increase to the provision was a result of adjustments made to historical loss factors and changes in qualitative factors in particular economic and industry conditions between the three months ended June 30, 2022 and three months ended June 30, 2021.

Noninterest income

Noninterest income decreased $114,000, or 5.1%, to $2.1 million for the three months ended June 30, 2022, compared to $2.2 million for the three months ended June 30, 2021. The decrease was largely due to a $210,000 reduction in securities gains due to a decline of $199,000 in the market value of equity securities, comprised mainly of bank stocks, partially offset by a $160,000 increase in insurance commissions. The increase in insurance commissions was primarily driven by contingency income which resulted from the higher than lock-in amounts received and core business including commercial and personal insurance lines. In addition, net gain on sale of loans decreased $31,000 as there were no loans sold during the three months ended June 30, 2022.

Noninterest Expense

Noninterest expense decreased $5.3 million, or 38.7%, to $8.4 million for the three months ended June 30, 2022 compared to $13.7 million for the three months ended June 30, 2021, and compared to $8.7 million for the three months ended March 31, 2022. The primary drivers were decreases of $2.3 million and $1.2 million related to the writedown of fixed assets and intangible impairment associated with branch consolidation and sale initiatives in 2021, respectively. In addition, salaries and benefits decreased $537,000 and occupancy decreased $248,000, primarily related to the reduction of footprint and related headcount resulting from the consolidation and sale of branches during 2021. Contracted services decreased $402,000 to $348,000 for the three months ended June 30, 2022 compared to $750,000 for the three months ended June 30, 2021. This was a result of branch optimization initiatives completed in the prior year.

Statement of Financial Condition Review

Assets

Total assets decreased $39.0 million, or 2.7%, to $1.39 billion at June 30, 2022, compared to $1.43 billion at December 31, 2021.

• Cash and due from banks decreased $38.6 million, or 32.2%, to $81.1 million at June 30, 2022, compared to $119.7 million at December 31, 2021. The change is primarily due to a decrease in deposits as further described below in the Liabilities section.
• Securities decreased $11.5 million, or 5.1%, to $213.5 million at June 30, 2022, compared to $225.0 million at December 31, 2021. Current period activity included $26.8 million of purchases, and $17.0 million of pay downs. The purchases were made to earn a higher yield on excess cash. In addition, there was a $21.0 million decrease in the market value of the debt securities portfolio, primarily due to the increase in market interest rates, and a $206,000 loss in market value in the equity securities portfolio, which is primarily comprised of bank stocks.

Payroll Protection Program (“PPP”) Update

• PPP loans decreased $20.7 million to $3.9 million at June 30, 2022 compared to $24.5 million at December 31, 2021.
• $144,000 of net PPP loan origination fees were unearned at June 30, 2022 compared to $678,000 at December 31, 2021. $130,000 of net PPP loan origination fees were earned in the three months ended June 30, 2022 compared to $404,000 for the three months ended March 31, 2022. 

Loans and Credit Quality

• Total loans held for investment increased $7.2 million, or 0.70%, to $1.03 billion at June 30, 2022 compared to $1.02 billion at December 31, 2021. Excluding the net decline of $20.7 million in PPP loans in the current period, loans increased $27.8 million.
• The allowance for loan losses was $12.8 million at June 30, 2022 and $11.6 million at December 31, 2021. As a result, the allowance for loan losses to total loans was 1.25% at June 30, 2022 compared to 1.13% at December 31, 2021. The allowance for loan losses to total loans, excluding PPP loans, was 1.25% at June 30, 2022 compared to 1.16% at December 31, 2021. The change in the allowance for loan losses was primarily due to adjustments to historical loss factors and changes in qualitative factors in particular economic and industry conditions since December 31, 2021.
• Net charge-offs for the three months ended June 30, 2022 were $2.5 million, or 1.01% of average loans on an annualized basis. Net recoveries for the three months ended June 30, 2021 were $19,000, or 0.01% of average loans on an annualized basis. Net charge-offs for the six months ended June 30, 2022 were $2.5 million, or 0.50% of average loans on an annualized basis. Net charge-offs for the six months ended June 30, 2021 were $27,000, or 0.01% of average loans on an annualized basis.
• Nonperforming loans, which includes nonaccrual loans, accruing loans past due 90 days or more, and accruing loans that are considered troubled debt restructurings, were $5.8 million at June 30, 2022 compared to $7.3 million at December 31, 2021. Nonperforming loans to total loans ratio was 0.57% at June 30, 2022 compared to 0.71% at December 31, 2021.

Other

• Intangible Assets decreased $891,000, or 17.0%, to $4.4 million at June 30, 2022 compared to $5.3 million at December 31, 2021 primarily due to amortization expense recognized during the period.
• Accrued interest receivable and other assets increased $5.9 million, or 45.9%; to $18.8 million at June 30, 2022, compared to $12.9 million at December 31, 2021. This change was primarily driven by deferred taxes as a result of the increase in market interest rates conditions and the decrease in the market value of the securities portfolio.

Liabilities

Total liabilities decreased $19.7 million, or 1.5%, to $1.27 billion at June 30, 2022 compared to $1.29 billion at December 31, 2021.

Deposits

• Total deposits decreased $11.4 million to $1.22 billion as of June 30, 2022 compared to $1.23 billion at December 31, 2021, an annualized decrease of 1.9%. Interest-bearing demand deposits and time deposits decreased $7.2 million and $11.5 million, respectively, partially offset by increases in noninterest bearing demand deposits and savings accounts by $3.4 million and $10.7 million, respectively. Average total deposits decreased $11.4 million, primarily in interest-bearing demand deposits and time deposits for the three months ended June 30, 2022 compared to the three months ended March 31, 2022,

Borrowed Funds

• Short-term borrowings decreased $7.1 million, or 18.1%, to $32.2 million at June 30, 2022, compared to $39.3 million at December 31, 2021. At June 30, 2022 and December 31, 2021, short-term borrowings were comprised entirely of securities sold under agreements to repurchase, which are related to business deposit customers whose funds, above designated target balances, are transferred into an overnight interest-earning investment account by purchasing securities from the Bank’s investment portfolio under an agreement to repurchase.

Stockholders’ Equity

Stockholders’ equity decreased $19.4 million, or 14.6%, to $113.8 million at June 30, 2022, compared to $133.1 million at December 31, 2021. Since December 31, 2021, the Company has paid $2.5 million in dividends. On February 15, 2022, the Company completed its stock repurchase program that was implemented on June 10, 2021. On April 21, 2022, a new $10 million repurchase program was authorized, with the Company repurchasing 27,439 shares at an average price of $22.06 per share during the second quarter. In total, the Company has repurchased $4.0 million since December 31, 2021. In addition, accumulated other comprehensive loss decreased $16.5 million primarily due to the effect of rising market interest rates on the Bank’s debt securities. This was partially offset by $3.2 million of net income.

Book value per share

Book value per common share was $22.18 at June 30, 2022 compared to $25.31 at December 31, 2021, a decrease of $3.13.

Tangible book value per common share (Non-GAAP) was $19.43 at June 30, 2022, compared to $22.45 at December 31, 2021, a decrease of $3.02.

Refer to “Explanation of Use of Non-GAAP Financial Measures” at the end of this Press Release.

About CB Financial Services, Inc.

CB Financial Services, Inc. is the bank holding company for Community Bank, a Pennsylvania-chartered commercial bank. Community Bank operates its branch network in southwestern Pennsylvania and West Virginia. Community Bank offers a broad array of retail and commercial lending and deposit services and provides commercial and personal insurance brokerage services through Exchange Underwriters, Inc., its wholly owned subsidiary.

For more information about CB Financial Services, Inc. and Community Bank, visit our website at www.communitybank.tv.

Statement About Forward-Looking Statements

Statements contained in this press release that are not historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995 and such forward-looking statements are subject to significant risks and uncertainties. The Company intends such forward-looking statements to be covered by the safe harbor provisions contained in the Act. The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations and future prospects of the Company and its subsidiaries include, but are not limited to, general and local economic conditions, the scope and duration of economic contraction as a result of the COVID-19 pandemic and its effects on the Company’s business and that of the Company’s customers, changes in market interest rates, deposit flows, demand for loans, real estate values and competition, competitive products and pricing, the ability of our customers to make scheduled loan payments, loan delinquency rates and trends, our ability to manage the risks involved in our business, our ability to control costs and expenses, inflation, market and monetary fluctuations, changes in federal and state legislation and regulation applicable to our business, actions by our competitors, and other factors that may be disclosed in the Company’s periodic reports as filed with the Securities and Exchange Commission. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. The Company assumes no obligation to update any forward-looking statements except as may be required by applicable law or regulation.

CB FINANCIAL SERVICES, INC. SELECTED CONSOLIDATED FINANCIAL INFORMATION
(Dollars in thousands, except share and per share data) (Unaudited)
Selected Financial Condition Data	6/30/22			3/31/22			12/31/21			9/30/21			6/30/21
ASSETS
Cash and Due From Banks	$	81,121		$	123,588		$	119,674		$	173,523		$	172,010
Securities		213,505			231,097			224,974			221,351			208,472
Loans Held for Sale		—			—			—			17,407			11,409
Loans
Real Estate:
Residential		325,138			317,254			320,798			317,373			322,480
Commercial		426,105			427,227			392,124			379,621			360,518
Construction		41,277			54,227			85,028			78,075			85,187
Commercial and Industrial
Commercial and Industrial		62,054			59,601			64,487			69,657			70,666
PPP		3,853			8,242			24,523			32,703			49,525
Consumer		148,921			143,422			122,152			112,087			106,404
Other		20,621			10,669			11,684			12,083			12,666
Total Loans		1,027,969			1,020,642			1,020,796			1,001,599			1,007,446
Allowance for Loan Losses		(12,833	)		(11,595	)		(11,582	)		(11,581	)		(11,544	)
Loans, Net		1,015,136			1,009,047			1,009,214			990,018			995,902
Premises and Equipment Held for Sale		—			—			—			795			795
Premises and Equipment, Net		18,196			18,349			18,399			18,502			18,682
Bank-Owned Life Insurance		25,610			25,468			25,332			25,190			25,052
Goodwill		9,732			9,732			9,732			9,732			9,732
Intangible Assets, Net		4,404			4,850			5,295			5,740			6,186
Accrued Interest and Other Assets		18,757			16,539			12,859			12,560			13,373
Total Assets	$	1,386,461		$	1,438,670		$	1,425,479		$	1,474,818		$	1,461,613
LIABILITIES
Deposits Held for Sale	$	—		$	—		$	—		$	102,647		$	102,557
Deposits
Non-Interest Bearing Demand Deposits		389,127			400,105			385,775			373,320			368,452
Interest Bearing Demand Accounts		265,347			280,455			272,518			244,004			246,920
Money Market Accounts		185,308			192,929			192,125			190,426			176,824
Savings Accounts		250,226			247,589			239,482			232,679			226,639
Time Deposits		125,182			129,235			136,713			144,727			154,718
Total Deposits		1,215,190			1,250,313			1,226,613			1,185,156			1,173,553
Short-Term Borrowings		32,178			39,219			39,266			42,623			39,054
Other Borrowings		17,618			17,607			17,601			6,000			6,000
Accrued Interest Payable and Other Liabilities		7,703			9,375			8,875			7,405			7,913
Total Liabilities		1,272,689			1,316,514			1,292,355			1,343,831			1,329,077
STOCKHOLDERS’ EQUITY	$	113,772		$	122,156		$	133,124		$	130,987		$	132,536

	Three Months Ended															Six Months Ended
Selected Operating Data	6/30/22			3/31/22			12/31/21			9/30/21			6/30/21			6/30/22			6/30/21
Interest and Dividend Income
Loans, Including Fees	$	9,733		$	9,551		$	9,904		$	9,718		$	9,936		$	19,284		$	20,082
Securities:
Taxable		988			905			866			843			635			1,893			1,281
Tax-Exempt		57			66			66			71			74			123			152
Dividends		20			22			21			19			24			42			44
Other Interest and Dividend Income		160			72			106			135			151			232			249
Total Interest and Dividend Income		10,958			10,616			10,963			10,786			10,820			21,574			21,808
Interest Expense
Deposits		604			530			636			715			827			1,134			1,774
Short-Term Borrowings		18			19			26			25			24			37			47
Other Borrowings		173			174			70			36			35			347			76
Total Interest Expense		795			723			732			776			886			1,518			1,897
Net Interest and Dividend Income		10,163			9,893			10,231			10,010			9,934			20,056			19,911
Provision (Recovery) for Loan Losses		3,784			—			75			—			(1,200	)		3,784			(1,200	)
Net Interest and Dividend Income After Provision (Recovery) for Loan Losses		6,379			9,893			10,156			10,010			11,134			16,272			21,111
Noninterest Income:
Service Fees		559			526			569			602			614			1,085			1,160
Insurance Commissions		1,369			1,798			1,618			1,194			1,209			3,167			2,804
Other Commissions		179			89			90			93			173			268			338
Net Gain on Sales of Loans		—			—			977			49			31			—			117
Net (Loss) Gain on Securities		(199	)		(7	)		44			24			11			(206	)		458
Net Gain on Purchased Tax Credits		14			14			17			18			17			28			35
Gain on Sale of Branches		—			—			5,203			—			—			—			—
Net Loss on Disposal of Fixed Assets		—			(8	)		—			—			(3	)		(8	)		(3	)
Income from Bank-Owned Life Insurance		142			136			142			138			136			278			273
Other Income		41			65			29			80			31			106			211
Total Noninterest Income		2,105			2,613			8,689			2,198			2,219			4,718			5,393
Noninterest Expense:
Salaries and Employee Benefits		4,539			4,565			5,181			4,787			5,076			9,104			9,970
Occupancy		776			686			619			615			1,024			1,462			1,734
Equipment		182			210			252			205			311			392			577
Data Processing		446			485			488			541			607			931			1,125
FDIC Assessment		128			209			222			293			249			337			499
PA Shares Tax		240			240			173			224			225			480			490
Contracted Services		348			587			1,133			1,441			750			935			1,437
Legal and Professional Fees		389			152			206			180			419			541			608
Advertising		115			116			191			225			193			231			333
Other Real Estate Owned (Income)		(37	)		(38	)		(30	)		(89	)		(26	)		(75	)		(64	)
Amortization of Intangible Assets		446			445			445			446			503			891			1,035
Intangible Assets and Goodwill Impairment		—			—			—			—			1,178			—			1,178
Writedown of Fixed Assets		—			—			23			2			2,268			—			2,268
Other		838			999			1,069			903			945			1,837			1,927
Total Noninterest Expense		8,410			8,656			9,972			9,773			13,722			17,066			23,117
Income (Loss) Before Income Tax (Benefit) Expense		74			3,850			8,873			2,435			(369	)		3,924			3,387
Income Tax (Benefit) Expense		(44	)		803			1,908			452			(146	)		759			765
Net Income (Loss)	$	118		$	3,047		$	6,965		$	1,983		$	(223	)	$	3,165		$	2,622

	Three Months Ended											Six Months Ended
Per Common Share Data	6/30/22		3/31/22		12/31/21		9/30/21		6/30/21			6/30/22		6/30/21
Dividends Per Common Share	$	0.24	$	0.24	$	0.24	$	0.24	$	0.24		$	0.48	$	0.48
Earnings (Loss) Per Common Share - Basic		0.02		0.59		1.32		0.37		(0.04	)		0.61		0.48
Earnings (Loss) Per Common Share - Diluted		0.02		0.58		1.31		0.37		(0.04	)		0.61		0.48
Adjusted Earnings Per Common Share - Diluted (Non-GAAP) ^(1)		0.05		0.59		0.53		0.36		0.59			0.64		1.05
Weighted Average Common Shares Outstanding - Basic		5,147,846		5,198,194		5,291,795		5,373,032		5,432,234			5,172,881		5,433,298
Weighted Average Common Shares Outstanding - Diluted		5,156,975		5,220,887		5,314,537		5,390,128		5,432,234			5,189,144		5,438,401

	6/30/22			3/31/22			12/31/21			9/30/21			6/30/21
Common Shares Outstanding		5,128,333			5,156,897			5,260,672			5,330,401			5,409,077
Book Value Per Common Share	$	22.18		$	23.69		$	25.31		$	24.57		$	24.50
Tangible Book Value per Common Share ^(1)		19.43			20.86			22.45			21.67			21.56
Stockholders’ Equity to Assets		8.2	%		8.5	%		9.3	%		8.9	%		9.1	%
Tangible Common Equity to Tangible Assets ^(1)		7.3			7.6			8.4			7.9			8.1

	Three Months Ended					Six Months Ended
Selected Financial Ratios ^(2)	6/30/22	3/31/22	12/31/21	9/30/21	6/30/21	6/30/22	6/30/21
Return on Average Assets	0.03 %	0.87 %	1.87 %	0.54 %	(0.06) %	0.45 %	0.36 %
Adjusted Return on Average Assets ^(1)	0.08	0.87	0.76	0.53	0.87	0.48	0.79
Return on Average Equity	0.40	9.50	20.95	5.93	(0.66)	5.15	3.92
Adjusted Return on Average Equity ^(1)	0.93	9.54	8.55	5.88	9.57	5.42	8.53
Average Interest-Earning Assets to Average Interest-Bearing Liabilities	149.03	144.48	145.09	146.78	146.82	146.74	144.94
Average Equity to Average Assets	8.49	9.14	8.93	9.03	9.08	8.81	9.27
Net Interest Rate Spread	3.00	2.98	2.85	2.77	2.72	3.00	2.81
Net Interest Rate Spread (FTE) ^(1)	3.01	2.99	2.86	2.78	2.74	3.01	2.82
Net Interest Margin	3.12	3.08	2.95	2.88	2.84	3.10	2.94
Net Interest Margin (FTE) ^(1)	3.13	3.10	2.96	2.89	2.85	3.11	2.95
Net Charge-offs (Recoveries) to Average Loans	1.01	(0.01)	0.03	(0.01)	(0.01)	0.50	0.01
Efficiency Ratio	68.55	69.21	52.71	80.05	112.91	68.89	91.36
Adjusted Efficiency Ratio ^(1)	64.18	65.88	69.73	77.27	80.68	65.03	75.25

Asset Quality Ratios	6/30/22		3/31/22		12/31/21		9/30/21		6/30/21
Allowance for Loan Losses to Total Loans	1.25	%	1.14	%	1.13	%	1.16	%	1.15	%
Allowance for Loan Losses to Total Loans, Excluding PPP Loans (Non-GAAP) ^(1)	1.25		1.15		1.16		1.20		1.21
Allowance for Loan Losses to Nonperforming Loans ^(3)	219.89		158.88		159.40		106.18		74.92
Allowance for Loan Losses to Noncurrent Loans ^(4)	329.47		218.28		233.37		135.37		90.83
Delinquent and Nonaccrual Loans to Total Loans ^(4) (5)	0.45		0.79		0.78		0.97		1.37
Nonperforming Loans to Total Loans ^(3)	0.57		0.72		0.71		1.09		1.53
Noncurrent Loans to Total Loans ^(4)	0.38		0.52		0.49		0.85		1.26
Nonperforming Assets to Total Assets ^(6)	0.42		0.51		0.51		0.74		1.07

Capital Ratios ^(7)	6/30/22		3/31/22		12/31/21		9/30/21		6/30/21
Common Equity Tier 1 Capital (to Risk Weighted Assets)	11.83	%	11.99	%	11.95	%	11.53	%	11.67	%
Tier 1 Capital (to Risk Weighted Assets)	11.83		11.99		11.95		11.53		11.67
Total Capital (to Risk Weighted Assets)	13.08		13.20		13.18		12.77		12.92
Tier 1 Leverage (to Adjusted Total Assets)	8.33		8.19		7.76		7.38		7.23

(1) Refer to Explanation of Use of Non-GAAP Financial Measures in this Press Release for the calculation of the measure and reconciliation to the most comparable GAAP measure.
(2) Interim period ratios are calculated on an annualized basis.
(3) Nonperforming loans consist of nonaccrual loans, accruing loans that are 90 days or more past due, and troubled debt restructured loans.
(4) Noncurrent loans consist of nonaccrual loans and accruing loans that are 90 days or more past due.
(5) Delinquent loans consist of accruing loans that are 30 days or more past due.
(6) Nonperforming assets consist of nonperforming loans and other real estate owned.
(7) Capital ratios are for Community Bank only. Certain items previously reported may have been reclassified to conform with the current reporting period’s format.

AVERAGE BALANCES AND YIELDS
	Three Months Ended
	June 30, 2022						March 31, 2022						December 31, 2021						September 30, 2021						June 30, 2021
	Average Balance		Interest and Dividends		Yield / Cost ^(1)		Average Balance		Interest and Dividends		Yield / Cost ^(1)		Average Balance		Interest and Dividends		Yield / Cost ^(1)		Average Balance		Interest and Dividends		Yield / Cost ^(1)		Average Balance		Interest and Dividends		Yield / Cost ^(1)
(Dollars in thousands) (Unaudited)
Assets:
Interest-Earning Assets:
Loans, Net ^(2)	$	1,007,874	$	9,751	3.88	%	$	1,009,210	$	9,573	3.85	%	$	1,004,827	$	9,927	3.92	%	$	1,004,474	$	9,740	3.85	%	$	1,016,868	$	9,959	3.93	%
Debt Securities
Taxable		228,315		988	1.73			215,906		905	1.68			205,328		866	1.69			197,763		843	1.71			124,685		635	2.04
Exempt From Federal Tax		9,109		73	3.21			10,195		84	3.30			10,477		84	3.21			11,647		90	3.09			12,276		94	3.06
Equity Securities		2,693		20	2.97			2,693		22	3.27			2,693		21	3.12			2,655		19	2.86			2,649		24	3.62
Interest Bearing Deposits at Banks		56,379		122	0.87			59,296		33	0.22			150,102		61	0.16			160,935		92	0.23			242,348		106	0.17
Other Interest-Earning Assets		3,235		38	4.71			3,483		39	4.54			3,475		45	5.14			3,512		43	4.86			4,044		45	4.46
Total Interest-Earning Assets		1,307,605		10,992	3.37			1,300,783		10,656	3.32			1,376,902		11,004	3.17			1,380,986		10,827	3.11			1,402,870		10,863	3.11
Noninterest-Earning Assets		84,323						122,288						100,607						88,291						82,794
Total Assets	$	1,391,928					$	1,423,071					$	1,477,509					$	1,469,277					$	1,485,664
Liabilities and Stockholders' Equity
Interest-Bearing Liabilities:
Interest-Bearing Demand Deposits ^(3)	$	260,655		111	0.17	%	$	276,603		48	0.07	%	$	278,546		51	0.07		$	275,411		48	0.07		$	275,752		55	0.08	%
Savings ^(3)		248,356		20	0.03			243,786		19	0.03			252,387		20	0.03			251,801		21	0.03			247,238		25	0.04
Money Market ^(3)		188,804		61	0.13			192,425		41	0.09			209,572		57	0.11			198,167		55	0.11			199,652		71	0.14
Time Deposits ^(3)		127,832		412	1.29			132,015		422	1.30			154,342		508	1.31			168,654		591	1.39			177,506		676	1.53
Total Interest-Bearing Deposits^(3)		825,647		604	0.29			844,829		530	0.25			894,847		636	0.28			894,033		715	0.32			900,148		827	0.37
Short-Term Borrowings
Securities Sold Under Agreements to Repurchase		34,135		18	0.21			37,884		19	0.20			44,709		26	0.23			40,818		25	0.24			49,325		24	0.20
Other Borrowings		17,611		173	3.94			17,604		174	4.01			9,474		70	2.93			6,000		36	2.38			6,000		35	2.34
Total Interest-Bearing Liabilities		877,393		795	0.36			900,317		723	0.33			949,030		732	0.31			940,851		776	0.33			955,473		886	0.37
Noninterest-Bearing Demand Deposits		391,975						384,188						388,787						387,746						387,317
Other Liabilities		4,415						8,554						7,800						8,019						7,999
Total Liabilities		1,273,783						1,293,059						1,345,617						1,336,616						1,350,789
Stockholders' Equity		118,145						130,012						131,892						132,661						134,875
Total Liabilities and Stockholders' Equity	$	1,391,928					$	1,423,071					$	1,477,509					$	1,469,277					$	1,485,664
Net Interest Income (FTE) (Non-GAAP) ^(4)				10,197						9,933						10,272						10,051						9,977
Net Interest-Earning Assets ^(5)		430,212						400,466						427,872						440,135						447,397
Net Interest Rate Spread (FTE) (Non-GAAP) ^(4) (6)					3.01	%					2.99	%					2.86						2.78						2.74	%
Net Interest Margin (FTE) (Non-GAAP)^(4)(7)					3.13						3.10						2.96						2.89						2.85
PPP Loans		5,546		144	10.41			14,673		445	12.30			29,067		391	5.34			40,313		484	4.76			57,661		636	4.42

(1) Annualized based on three months ended results.
(2) Net of the allowance for loan losses and includes nonaccrual loans with a zero yield and Loans Held for Sale if applicable.
(3) Includes Deposits Held for Sale that were sold in December 2021.
(4) Refer to Explanation and Use of Non-GAAP Financial Measures in this Press Release for the calculation of the measure and reconciliation to the most comparable GAAP measure.
(5) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(6) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
(7) Net interest margin represents annualized net interest income divided by average total interest-earning assets.

AVERAGE BALANCES AND YIELDS
	Six Months Ended
	June 30, 2022						June 30, 2021
	Average Balance		Interest and Dividends		Yield / Cost ^(1)		Average Balance		Interest and Dividends		Yield / Cost ^(1)
(Dollars in thousands) (Unaudited)
Assets:
Interest-Earning Assets:
Loans, Net ^(2)	$	1,008,539	$	19,322	3.86	%	$	1,024,319	$	20,131	3.96	%
Debt Securities
Taxable		222,144		1,893	1.70			123,790		1,281	2.07
Exempt From Federal Tax		9,649		156	3.23			12,608		192	3.05
Marketable Equity Securities		2,693		42	3.12			2,641		44	3.33
Interest Bearing Deposits at Banks		57,829		156	0.54			200,388		150	0.15
Other Interest-Earning Assets		3,358		76	4.56			3,977		99	5.02
Total Interest-Earning Assets		1,304,212		21,645	3.35			1,367,723		21,897	3.23
Noninterest-Earning Assets		103,201						87,645
Total Assets	$	1,407,413					$	1,455,368
Liabilities and Stockholders' Equity
Interest-Bearing Liabilities:
Interest-Bearing Demand Deposits ^(3)	$	268,585		160	0.12	%	$	267,455		133	0.10	%
Savings ^(3)		246,084		38	0.03			243,565		57	0.05
Money Market ^(3)		190,605		102	0.11			198,530		168	0.17
Time Deposits ^(3)		129,914		834	1.29			182,283		1,416	1.57
Total Interest-Bearing Deposits ^(3)		835,188		1,134	0.27			891,833		1,774	0.40
Short-Term Borrowings
Securities Sold Under Agreements to Repurchase		36,000		37	0.21			45,232		47	0.21
Other Borrowings		17,608		347	3.97			6,597		76	2.32
Total Interest-Bearing Liabilities		888,796		1,518	0.34			943,662		1,897	0.41
Noninterest-Bearing Demand Deposits		388,103						368,318
Other Liabilities		6,468						8,433
Total Liabilities		1,283,367						1,320,413
Stockholders' Equity		124,046						134,955
Total Liabilities and Stockholders' Equity	$	1,407,413					$	1,455,368
Net Interest Income (FTE) (Non-GAAP) ^(4)				20,127						20,000
Net Interest-Earning Assets ^(5)		415,416						424,061
Net Interest Rate Spread (FTE) (Non-GAAP) ^(4)(6)					3.01	%					2.82	%
Net Interest Margin (FTE) (Non-GAAP)^(4)(7)					3.11						2.95
PPP Loans		10,085		589	11.78			57,305		1,313	4.62

(1) Annualized based on six months ended results.
(2) Net of the allowance for loan losses and includes nonaccrual loans with a zero yield and Loans Held for Sale if applicable.
(3) Includes Deposits Held for Sale that were sold in December 2021.
(4) Refer to Explanation and Use of Non-GAAP Financial Measures in this Press Release for the calculation of the measure and reconciliation to the most comparable GAAP measure.
(5) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(6) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
(7) Net interest margin represents annualized net interest income divided by average total interest-earning assets.

Explanation of Use of Non-GAAP Financial Measures

In addition to financial measures presented in accordance with generally accepted accounting principles (“GAAP”), we use, and this Press Release contains or references, certain non-GAAP financial measures. We believe these non-GAAP financial measures provide useful information in understanding our underlying results of operations or financial position and our business and performance trends as they facilitate comparisons with the performance of other companies in the financial services industry. Non-GAAP adjusted items impacting the Company's financial performance are identified to assist investors in providing a complete understanding of factors and trends affecting the Company’s business and in analyzing the Company’s operating results on the same basis as that applied by management. Although we believe that these non-GAAP financial measures enhance the understanding of our business and performance, they should not be considered an alternative to GAAP or considered to be more important than financial results determined in accordance with GAAP, nor are they necessarily comparable with non-GAAP measures which may be presented by other companies. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found herein.

	Three Months Ended															Six Months Ended
	6/30/22			3/31/22			12/31/21			9/30/21			6/30/21			6/30/22			6/30/21
(Dollars in thousands, except share and per share data) (Unaudited)
Net Income (Loss) (GAAP)	$	118		$	3,047		$	6,965		$	1,983		$	(223	)	$	3,165		$	2,622
Adjustments
Loss (Gain) on Securities		199			7			(44	)		(24	)		(11	)		206			(458	)
Gain on Sale of Branches		—			—			(5,203	)		—			—			—			—
Loss on Disposal of Fixed Assets		—			8			—			—			3			8			3
Tax effect		(42	)		(3	)		1,102			5			2			(45	)		96
Non-Cash Charges:
Intangible Assets and Goodwill Impairment		—			—			—			—			1,178			—			1,178
Writedown on Fixed Assets		—			—			23			2			2,268			—			2,268
Tax Effect					—			—			—			—						—
Adjusted Net Income (Non-GAAP)	$	275		$	3,059		$	2,843		$	1,966		$	3,217		$	3,334		$	5,709
Weighted-Average Diluted Common Shares and Common Stock Equivalents Outstanding		5,156,975			5,220,887			5,314,537			5,390,128			5,432,234			5,189,144			5,438,401
Earnings (Loss) per Common Share - Diluted (GAAP)	$	0.02		$	0.58		$	1.31		$	0.37		$	(0.04	)	$	0.61		$	0.48
Adjusted Earnings per Common Share - Diluted (Non-GAAP)	$	0.05		$	0.59		$	0.53		$	0.36		$	0.59		$	0.64		$	1.05
Net Income (Loss) (GAAP) (Numerator)	$	118		$	3,047		$	6,965		$	1,983		$	(223	)	$	3,165		$	2,622
Annualization Factor		4.01			4.06			3.97			3.97			4.01			2.02			2.02
Average Assets (Denominator)		1,391,928			1,423,071			1,477,509			1,469,277			1,485,664			1,407,413			1,455,368
Return on Average Assets (GAAP)		0.03	%		0.87	%		1.87	%		0.54	%		(0.06	) %		0.45	%		0.36	%
Adjusted Net Income (Non-GAAP) (Numerator)	$	275		$	3,059		$	2,843		$	1,966		$	3,217		$	3,334		$	5,709
Annualization Factor		4.01			4.06			3.97			3.97			4.01			2.02			2.02
Average Assets (Denominator)		1,391,928			1,423,071			1,477,509			1,469,277			1,485,664			1,407,413			1,455,368
Adjusted Return on Average Assets (Non-GAAP)		0.08	%		0.87	%		0.76	%		0.53	%		0.87	%		0.48	%		0.79	%

	Three Months Ended															Six Months Ended
	6/30/22			3/31/22			12/31/21			9/30/21			6/30/21			6/30/22			6/30/21
(Dollars in thousands) (Unaudited)
Net Income (Loss) (GAAP) (Numerator)	$	118		$	3,047		$	6,965		$	1,983		$	(223	)	$	3,165		$	2,622
Annualization Factor		4.01			4.06			3.97			3.97			4.01			2.02			2.02
Average Equity (Denominator) (GAAP)		118,145			130,012			131,892			132,661			134,875			124,046			134,955
Return on Average Equity (GAAP)		0.40	%		9.50	%		20.95	%		5.93	%		(0.66	) %		5.15	%		3.92	%
Adjusted Net Income (Non-GAAP) (Numerator)	$	275		$	3,059		$	2,843		$	1,966		$	3,217		$	3,334		$	5,709
Annualization Factor		4.01			4.06			3.97			3.97			4.01			2.02			2.02
Average Equity (Denominator) (GAAP)		118,145			130,012			131,892			132,661			134,875			124,046			134,955
Adjusted Return on Average Equity (Non-GAAP)		0.93	%		9.54	%		8.55	%		5.88	%		9.57	%		5.42	%		8.53	%

Tangible book value per common share is a non-GAAP measure and is calculated based on tangible common equity divided by period-end common shares outstanding. Tangible common equity to tangible assets is a non-GAAP measure and is calculated based on tangible common equity divided by tangible assets. We believe these non-GAAP measures serve as useful tools to help evaluate the strength and discipline of the Company's capital management strategies and as an additional, conservative measure of the Company’s total value.

	6/30/22			3/31/22			12/31/21			9/30/21			6/30/21
(Dollars in thousands, except share and per share data) (Unaudited)
Assets (GAAP)	$	1,386,461		$	1,438,670		$	1,425,479		$	1,474,818		$	1,461,613
Goodwill and Intangible Assets, Net		(14,136	)		(14,582	)		(15,027	)		(15,472	)		(15,918	)
Tangible Assets (Non-GAAP) (Numerator)	$	1,372,325		$	1,424,088		$	1,410,452		$	1,459,346		$	1,445,695
Stockholders' Equity (GAAP)	$	113,772		$	122,156		$	133,124		$	130,987		$	132,536
Goodwill and Intangible Assets, Net		(14,136	)		(14,582	)		(15,027	)		(15,472	)		(15,918	)
Tangible Common Equity or Tangible Book Value (Non-GAAP) (Denominator)	$	99,636		$	107,574		$	118,097		$	115,515		$	116,618
Stockholders’ Equity to Assets (GAAP)		8.2	%		8.5	%		9.3	%		8.9	%		9.1	%
Tangible Common Equity to Tangible Assets (Non-GAAP)		7.3	%		7.6	%		8.4	%		7.9	%		8.1	%
Common Shares Outstanding (Denominator)		5,128,333			5,156,897			5,260,672			5,330,401			5,409,077
Book Value per Common Share (GAAP)	$	22.18		$	23.69		$	25.31		$	24.57		$	24.50
Tangible Book Value per Common Share (Non-GAAP)	$	19.43		$	20.86		$	22.45		$	21.67		$	21.56

Interest income on interest-earning assets, net interest rate spread and net interest margin are presented on a fully tax-equivalent (“FTE”) basis. The FTE basis adjusts for the tax benefit of income on certain tax-exempt loans and securities using the federal statutory income tax rate of 21 percent. We believe the presentation of net interest income on a FTE basis ensures comparability of net interest income arising from both taxable and tax-exempt sources and is consistent with industry practice. The following table reconciles net interest income, net interest spread and net interest margin on a FTE basis for the periods indicated:

	Three Months Ended															Six Months Ended
	6/30/22			3/31/22			12/31/21			9/30/21			6/30/21			6/30/22			6/30/21
(Dollars in thousands) (Unaudited)
Interest Income (GAAP)	$	10,958		$	10,616		$	10,963		$	10,786		$	10,820		$	21,574		$	21,808
Adjustment to FTE Basis		34			40			41			41			43			71			89
Interest Income (FTE) (Non-GAAP)		10,992			10,656			11,004			10,827			10,863			21,645			21,897
Interest Expense (GAAP)		795			723			732			776			886			1,518			1,897
Net Interest Income (FTE) (Non-GAAP)	$	10,197		$	9,933		$	10,272		$	10,051		$	9,977		$	20,127		$	20,000
Net Interest Rate Spread (GAAP)		3.00	%		2.98	%		2.85	%		2.77	%		2.72	%		3.00	%		2.81	%
Adjustment to FTE Basis		0.01			0.01			0.01			0.01			0.02			0.01			0.01
Net Interest Rate Spread (FTE) (Non-GAAP)		3.01			2.99			2.86			2.78			2.74			3.01			2.82
Net Interest Margin (GAAP)		3.12	%		3.08	%		2.95	%		2.88	%		2.84	%		3.10	%		2.94	%
Adjustment to FTE Basis		0.01			0.02			0.01			0.01			0.01			0.01			0.01
Net Interest Margin (FTE) (Non-GAAP)		3.13			3.10			2.96			2.89			2.85			3.11			2.95

Adjusted efficiency ratio excludes the effect of certain non-recurring or non-cash items and represents adjusted noninterest expense divided by adjusted operating revenue. The Company evaluates its operational efficiency based on its adjusted efficiency ratio and believes it provides additional perspective on its ongoing performance as well as peer comparability.

	Three Months Ended															Six Months Ended
	6/30/22			3/31/22			12/31/21			9/30/21			6/30/21			6/30/22			6/30/21
(Dollars in thousands) (Unaudited)
Noninterest Expense (GAAP)	$	8,410		$	8,656		$	9,972		$	9,773		$	13,722		$	17,066		$	23,117
Net Interest and Dividend Income (GAAP)	$	10,163		$	9,893		$	10,231		$	10,010		$	9,934		$	20,056		$	19,911
Noninterest Income (GAAP)		2,105			2,613			8,689			2,198			2,219			4,718			5,393
Operating Revenue (GAAP)	$	12,268		$	12,506		$	18,920		$	12,208		$	12,153		$	24,774		$	25,304
Efficiency Ratio (GAAP)		68.55	%		69.21	%		52.71	%		80.05	%		112.91	%		68.89	%		91.36	%
Noninterest Expense (GAAP)	$	8,410		$	8,656		$	9,972		$	9,773		$	13,722		$	17,066		$	23,117
Less:
Other Real Estate Owned (Income)		(37	)		(38	)		(30	)		(89	)		(26	)		(75	)		(64	)
Amortization of Intangible Assets		446			445			445			446			503			891			1,035
Intangible Assets and Goodwill Impairment		—			—			—			—			1,178			—			1,178
Writedown on Fixed Assets		—			—			23			2			2,268			—			2,268
Adjusted Noninterest Expense (Non-GAAP)	$	8,001		$	8,249		$	9,534		$	9,414		$	9,799		$	16,250		$	18,700
Net Interest and Dividend Income (GAAP)	$	10,163		$	9,893		$	10,231		$	10,010		$	9,934		$	20,056		$	19,911
Noninterest Income (GAAP)		2,105			2,613			8,689			2,198			2,219			4,718			5,393
Less:
Net (Loss) Gain on Securities		(199	)		(7	)		44			24			11			(206	)		458
Gain on Sale of Branches		—			—			5,203			—			—			—			—
Net Loss on Disposal of Fixed Assets		—			(8	)		—			—			(3	)		(8	)		(3	)
Adjusted Noninterest Income (Non-GAAP)	$	2,304		$	2,628		$	3,442		$	2,174		$	2,211		$	4,932		$	4,938
Adjusted Operating Revenue (Non-GAAP)	$	12,467		$	12,521		$	13,673		$	12,184		$	12,145		$	24,988		$	24,849
Adjusted Efficiency Ratio (Non-GAAP)		64.18	%		65.88	%		69.73	%		77.27	%		80.68	%		65.03	%		75.25	%

Allowance for loan losses to total loans, excluding PPP loans, is a non-GAAP measure that serves as a useful measurement to evaluate the allowance for loan losses without the impact of SBA guaranteed loans.

	6/30/22			3/31/22			12/31/21			9/30/21			6/30/21
(Dollars in thousands) (Unaudited)
Allowance for Loan Losses	$	12,833		$	11,595		$	11,582		$	11,581		$	11,544
Total Loans		1,027,969		$	1,020,642			1,020,796		$	1,001,599		$	1,007,446
PPP Loans		(3,853	)		(8,242	)		(24,523	)		(32,703	)		(49,525	)
Total Loans, Excluding PPP Loans (Non-GAAP)	$	1,024,116		$	1,012,400		$	996,273		$	968,896		$	957,921
Allowance for Loan Losses to Total Loans, Excluding PPP Loans (Non-GAAP)		1.25	%		1.15	%		1.16	%		1.20	%		1.21	%