Form 8-K - Current report

10/22/20240000750558NONE00007505582024-10-222024-10-22

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 8-K

 

CURRENT REPORT

PURSUANT TO SECTIONS 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Date of report (Date of earliest event reported):

October 22,2024

QNB Corp.

(Exact name of registrant as specified in its charter)

 

Pennsylvania	0-17706	23-2318082
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification No.)

 

15 North Third Street, P.O. Box 9005, Quakertown, PA 18951-9005

(Address of principal executive offices, including zip code)

 

[phone]

(Registrant's telephone number, including area code)

 

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

 

Securities registered pursuant to Section 12(b) of the Act: None.

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock		QNBC		N/A

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐		Pre-commencement communication pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

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. ☐

 

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Item 2.02	Results of Operations and Financial Condition

 

On October 22, 2024, QNB Corp. announced its consolidated financial results for the third quarter ended September 30, 2024. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

 

The information included in this Item, as well as Exhibit 99.1, referenced herein, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 unless specifically incorporated in such filing.

 

Item 9.01	Financial Statements and Exhibits

 

The following exhibits are filed herewith:

 

Exhibit No.	Description
D
99.1	News release disseminated on October 22, 2024 by QNB Corp.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 

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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.

 

		QNB Corp.
	By:	/s/ Jeffrey Lehocky
		Jeffrey Lehocky
		Chief Financial Officer
	Dated: October 22, 2024

 

 

 

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Ex 99.1

 

	PO Box 9005
	Quakertown, PA 18951-9005
	215.538.5600
	800.491.9070
	QNBBank.com

 

 

FOR IMMEDIATE RELEASE

 

 

 

QNB CORP. REPORTS

EARNINGS FOR THIRD QUARTER 2024

 

 

QUAKERTOWN, PA October 22, 2024) QNB Corp. (the “Company” or “QNB”) (OTC Bulletin Board: QNBC), the parent company of QNB Bank (the “Bank”), reported net income for the third quarter of 2024 of $3,338,000, or $0.91 per share on a diluted basis. This compares to net income of $2,344,000, or $0.65 per share on a diluted basis, for the same period in 2023. For the nine months ended September 30, 2024, QNB reported net income of $8,397,000, or $2.29 per share on a diluted basis. This compares to net income of $8,349,000, or $2.32 per share on a diluted basis, reported for the same period in 2023.

 

For the third quarter of 2024, the annualized rate of return on average assets and average shareholders’ equity was 0.72% and 8.13%, respectively, compared with 0.52% and 5.88%, respectively, for the third quarter 2023.

 

The operating performance of the Bank, a wholly-owned subsidiary of QNB Corp., improved for the quarter ended September 30, 2024, in comparison with the same period in 2023, due primarily to improvement in the interest margin causing a $1,182,000 increase in net interest income, decreased provision for credit losses on loans and unfunded commitments of $300,000 and a decrease in non-interest expense of $37,000; this was partly offset by a decrease in non-interest income of $96,000. The change in contribution from QNB Corp. for the quarter ended September 30, 2024, compared with the same period in 2023, is primarily due to more gains on sales from the equities portfolio and less unrealized losses on the equity portfolio; partly offset by interest expense on subordinated debt held at the holding company.

The following table presents disaggregated net income (loss):

	Three months ended,												Nine months ended,
	9/30/2024				9/30/2023				Variance				9/30/2024				9/30/2023				Variance
QNB Bank	$	3,394,000			$	2,334,000			$	1,060,000			$	8,466,000			$	8,568,000			$	(102,000	)
QNB Corp		(56,000	)			10,000				(66,000	)			(69,000	)			(219,000	)			150,000
Consolidated net income	$	3,338,000			$	2,344,000			$	994,000			$	8,397,000			$	8,349,000			$	48,000

 

Total assets as of September 30, 2024 were $1,841,563,000 compared with $1,706,318,000 at December 31, 2023. Total available-for-sale debt securities increased $19,855,000, or 7.9%, to

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$510,036,000, primarily due to purchases of higher-yielding securities partly offset be the sales of lower-yielding securities and payments. Loans receivable increased $77,828,000, or 7.1%, to $1,171,361,000. Total deposits increased $137,571,000, or 9.2%, to $1,626,284,000. Short-term borrowing declined $71,176,000, or 75.6%. During the third quarter of 2024, the QNB Corp. issued $40,000,000 of subordinated debt; the carrying value net of deferred costs was $39,030,000 at September 30, 2024.

“We continue to experience strong growth in customer loan and deposit balances, which has led to improvement in our net interest income and margin. Growth combined with solid liquidity and good asset quality, has our franchise positioned for positive momentum,” stated David W. Freeman, President and Chief Executive Officer. Freeman continued, “Our successful Sub-Debt issuance has further strengthened our Capital position and will enable continued growth in the future. I am optimistic that we are well positioned to capitalize on the foundation we have built.”

Net Interest Income and Net Interest Margin

Net interest income for the quarter ended September 30, 2024 totaled $11,127,000, an increase of $914,000, from the same period in 2023. Net interest margin was 2.48% for the third quarter of 2024 and 2.38% for the same period in 2023. Net interest margin was 2.45% for the nine months ended September 30, 2024, compared with 2.40% for the same period in 2023.

 

The yield on earning assets was 4.86% for the third quarter 2024, compared with 4.28% in the third quarter of 2023; an increase of 58 basis points. For the nine-month period ended September 30, 2024, the yield on earning assets was 4.71%, compared with 3.97% for the same period in 2023. The cost of interest-bearing liabilities was 2.90% for the quarter ended September 30, 2024, compared with 2.35% for the same period in 2023, an increase of 55 basis points. For the nine-month period ended September 30, 2024, the cost of interest-bearing liabilities was 2.77% compared with 1.96% for the same period in 2023.

 

Proceeds from the growth in average deposits and proceeds from the issuance of subordinated debt and the sale and payments received on investment securities over the past year were invested in loans and other interest earning assets, and used to pay down short-term borrowings. Loan growth was primarily in commercial real estate, which comprised 45% of average earning assets in the third quarter of 2024 compared with 42% for the same period in 2023, and the increases in both rates and volume in commercial real estate loans majorly contributed to the 47 basis-point increase in the yield on loans. The decline in the available-for-sale portfolio was primarily in mortgage-backed securities, which comprised 19% of average earnings assets in the third quarter of 2024 compared with 23% for the same period in 2023. The 40-basis point increase in rate on investments was primarily due to the impact of the interest rate swaps entered into at the end of the second quarter of 2023, contributing to the increase in net interest margin. The 55 basis-point increase in the rate paid on deposits and the issuance of subordinated debt were the primary contributors to the increase in the cost of funds of 55 basis points.

 

Asset Quality, Provision for Credit Losses on Loans and Allowance for Credit Losses

QNB recorded $154,000 in provision for credit losses on loans in the third quarter of 2024 compared to $452,000 in provision in the third quarter of 2023. QNB's allowance for credit losses on loans of $8,987,000 represents 0.77% of loans receivable at September 30, 2024, compared to

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$8,852,000, or 0.81% of loans receivable at December 31, 2023. Net loan charge-offs were $25,000 for the quarter ended September 30, 2024, compared with $275,000 for the same period in 2023. Annualized net loan charge-offs for the quarter ended September 30, 2024 were 0.01% and 0.10% for the quarter ended September 30, 2023, of average loans receivable, respectively. Net loan charge-offs were $58,000 for the nine months ended September 30, 2024, compared with recoveries of $219,000 for the same period in 2023 were primarily due to two large commercial customers. Annualized net loan charge-offs for the nine months ended September 30, 2024 were 0.01% compared to annualized net recoveries of 0.03% for the same period in 2023, of average loans receivable, respectively.

 

Total non-performing loans, which represent loans on non-accrual status and loans past due 90 days or more and still accruing interest, were $1,696,000, or 0.14% of loans receivable at September 30, 2024, compared with $1,940,000, or 0.18% of loans receivable at December 31, 2023. In cases where there is a collateral shortfall on non-accrual loans, specific reserves have been established based on updated collateral values even if the borrower continues to pay in accordance with the terms of the agreement. At September 30, 2024, $1,021,000, or approximately 60% of the loans classified as non-accrual, are current or past due less than 30 days. Commercial loans classified as substandard or doubtful loans totaled $26,883,000 at September 30, 2024, compared with $11,747,000 at December 31, 2023; these were comprised primarily of commercial real estate loans.

Non-Interest Income

Total non-interest income was $1,967,000 for the third quarter of 2024 compared with $1,755,000 for the same period in 2023. There was a net realized gain of $224,000 on the sale of investments for the quarter ended September 30, 2024 compared to a net gain of $131,000 on the sales of securities in the same period in 2023. Unrealized net gain on investment equity securities was $143,000 for the quarter ended September 30, 2024 compared to a net loss of $138,000 for the same period in 2023. During the third quarter of 2024 the Bank sold lower yielding securities to better position its net interest margin.

 

Fees for service to customers increased $48,000 for the quarter ended September 30, 2024, as overdraft fees decreased $16,000 and other deposit-related fees increased $32,000. Retail brokerage and advisory income decreased $80,000 to $139,000 for the same period, due to a decrease in customer balances following employee turnover. Other non-interest income decreased $151,000 for the same period due to a sales tax refund of $115,000 received in 2023 and a decline in merchant fee income of $16,000 due to value.

For the nine months ended September 30, 2024, non-interest income was $5,268,000 an increase of $714,000 compared to the same period in 2023, primarily due to the change in fair value of the equities portfolio of $1,783,000. QNB completed the exchange offer to convert the Bank's Visa B-1 shares to B-2 and C shares in the second quarter of 2024; the fair value of the Visa C shares was a gain of $1,419,000 at September 30, 2024. Realized loss on sale of securities was $495,000, a decline of $680,000 for the nine months ended September 30, 2024, compared with the same period in 2023. Net gain on sale of loans increased $27,000 when comparing the nine months ended September 30, 2024 with the same period in 2023. Increases in non-interest income for the nine months ended September 30, 2024 compared to the same period in 2023 comprise: fees for services to customers which increased $79,000. Decreases in non-interest income comprised:

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ATM and debit card fees, retail brokerage and advisory income, and other which decreased $16,000, $297,000 and $182,000, respectively. Other non-interest income decreased the $182,000 due primarily to a sales tax refund of $115,000 received in 2023, losses on disposals of furniture and equipment, mortgage servicing fees and letter of credit fees.

 

Non-Interest Expense

Total non-interest expense was $8,636,000 for the third quarter of 2024 compared with $8,671,000 for the same period in 2023. Salaries and benefits expense decreased $321,000, or 6.5%, to $4,650,000 when comparing the two quarters. Salary expense and related payroll taxes increased $77,000, or 1.9%, to $4,209,000 during the third quarter of 2024 compared to the same period in 2023. Benefits expense decreased $400,000, or 81.1%, when comparing the two periods primarily due to a reduction in medical costs and stop-loss reimbursements.

 

Net occupancy and furniture and equipment expense increased $27,000, or 1.8%, to $1,531,000 for the third quarter of 2024 primarily due to software maintenance costs partly offset by a reduction in repairs and maintenance. Other non-interest expense increased $259,000, or 11.8%, when comparing third quarter of 2024 with the same period in 2023 due to an increase in Bank shares tax of $89,000, due to the timing of tax credits received, an increase of $50,000 in debit card expense, an increase in FDIC insurance of $67,000, an increase in third-party services of $69,000, and an increase in write-offs due to fraud on customer accounts of $44,000, partly offset by decreases in director fees of $16,000, a decrease in marketing expense of $19,000 and a reduction loan-related costs of $23,000.

 

For the nine months ended September 30, 2024, non-interest expense was $26,403,000, an increase of $1,040,000, or 4.1%, compared to the same period in 2023.

 

Income Taxes

Provision for income taxes increased $467,000 to $961,000 in the third quarter of 2024 due to increased pre-tax income, compared with the same period in 2023. The effective tax rates for the quarter ended September 30, 2024 was 22.4% compared with 17.4% for the same period in 2023. The effective tax rates for the nine months ended September 30, 2024 was 20.5% compared with 18.9% for the same period in 2023.

 

 

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About the Company

 

QNB Corp. is the holding company for QNB Bank, which is headquartered in Quakertown, Pennsylvania. QNB Bank currently operates twelve branches in Bucks, Lehigh and Montgomery Counties and offers commercial and retail banking services in the communities it serves. In addition, the Company provides securities and advisory services under the name of QNB Financial Services through a registered Broker/Dealer and Registered Investment Advisor, and title insurance as a member of Laurel Abstract Company LLC. More information about QNB Corp. and QNB Bank is available at QNBBank.com.

Forward Looking Statement

This press release may contain forward-looking statements as defined in the Private Securities Litigation Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various factors. Such factors include the possibility that increased demand or prices for the Company’s financial services and products may not occur, changing economic and competitive conditions, technological developments, and other risks and uncertainties, including those detailed in the Company’s filings with the Securities and Exchange Commission, including "Item lA. Risk Factors," set forth in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2023. You should not place undue reliance on any forward-looking statements. These statements speak only as of the date of this press release, even if subsequently made available by the Company on its website or otherwise. The Company undertakes no obligation to update or revise these statements to reflect events or circumstances occurring after the date of this press release.

 

Contacts:	David W. Freeman	Jeffrey Lehocky
	President & Chief Executive Officer	Chief Financial Officer
	215-538-5600 x-5619	215-538-5600 x-5716
	[e-mail]	[e-mail]

 

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QNB Corp.
Consolidated Selected Financial Data (unaudited)
(Dollars in thousands)
Balance Sheet (Period End)	9/30/24			6/30/24			3/31/24			12/31/23			9/30/23
Assets	$	1,841,563		$	1,761,487		$	1,716,081		$	1,706,318		$	1,684,392
Cash and cash equivalents		104,232			76,909			50,963			62,657			55,141
Investment securities
Debt securities, AFS		510,036			460,418			481,596			490,181			505,390
Equity securities		2,760			7,233			6,217			5,910			4,765
Loans held-for-sale		294			786			—			549			446
Loans receivable		1,171,361			1,162,310			1,122,616			1,093,533			1,060,450
Allowance for loan losses		(8,987	)		(8,858	)		(8,738	)		(8,852	)		(8,542	)
Net loans		1,162,374			1,153,452			1,113,878			1,084,681			1,051,908
Deposits		1,626,284			1,572,839			1,536,188			1,488,713			1,483,333
Demand, non-interest bearing		190,240			190,333			188,260			185,098			192,226
Interest-bearing demand, money market and savings		1,055,409			1,003,813			990,451			988,634			1,000,921
Time		380,635			378,693			357,477			314,981			290,186
Short-term borrowings		22,918			49,066			55,088			94,094			96,703
Long-term debt		30,000			30,000			20,000			20,000			20,000
Subordinated debt		39,030			—			—			—			—
Shareholders' equity		105,340			96,885			93,686			90,824			74,081
Asset Quality Data (Period End)
Non-accrual loans	$	1,696		$	2,078		$	2,001		$	1,940		$	1,893
Loans past due 90 days or more and still accruing		—			—			—			—			—
Non-performing loans		1,696			2,078			2,001			1,940			1,893
Other real estate owned and repossessed assets		—			—			—			—			—
Non-performing assets	$	1,696		$	2,078		$	2,001		$	1,940		$	1,893
Allowance for credit losses on loans	$	8,987		$	8,858		$	8,738		$	8,852		$	8,542
Non-performing loans / Loans excluding held-for-sale		0.14	%		0.18	%		0.18	%		0.18	%		0.18	%
Non-performing assets / Assets		0.09	%		0.12	%		0.12	%		0.11	%		0.11	%
Allowance for credit losses on loans / Loans excluding held-for-sale		0.77	%		0.76	%		0.78	%		0.81	%		0.81	%

 

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QNB Corp.
Consolidated Selected Financial Data (unaudited)
(Dollars in thousands, except per share data)	Three months ended,						Nine months ended,
For the period:	9/30/24	6/30/24	3/31/24	12/31/23	9/30/23		9/30/24	9/30/23
Interest income	$21,945	$20,345	$19,569	$19,257	$18,497		$61,859	$49,825
Interest expense	10,818	9,753	9,401	9,065	8,284		29,972	19,862
Net interest income	11,127	10,592	10,168	10,192	10,213		31,887	29,963
Provision for credit losses	159	114	(86)	293	459		187	(1,137)
Net interest income after provision for credit losses	10,968	10,478	10,254	9,899	9,754		31,700	31,100
Non-interest income:
Fees for services to customers	469	427	420	414	421		1,316	1,237
ATM and debit card	691	705	636	687	685		2,032	2,048
Retail brokerage and advisory income	139	126	93	207	219		358	655
Net realized (loss) gain on investment securities	224	(1,096)	377	(2,262)	131		(495)	185
Unrealized gain (loss) on equity securities	143	1,016	(30)	904	(138)		1,129	(654)
Net gain on sale of loans	19	(2)	15	11	4		32	5
Other	282	289	325	322	433		896	1,078
Total non-interest income	1,967	1,465	1,836	283	1,755		5,268	4,554
Non-interest expense:
Salaries and employee benefits	4,650	5,038	4,974	4,717	4,971		14,662	14,309
Net occupancy and furniture and equipment	1,531	1,481	1,515	1,477	1,504		4,527	4,348
Other	2,455	2,415	2,344	2,552	2,196		7,214	6,706
Total non-interest expense	8,636	8,934	8,833	8,746	8,671		26,403	25,363
Income before income taxes	4,299	3,009	3,257	1,436	2,838		10,565	10,291
Provision for income taxes	961	544	663	302	494		2,168	1,942
Net income	$3,338	$2,465	$2,594	$1,134	$2,344		$8,397	$8,349
Share and Per Share Data:
Net income - basic	$0.91	$0.67	$0.71	$0.31	$0.65		$2.29	$2.32
Net income - diluted	$0.91	$0.67	$0.71	$0.31	$0.65		$2.29	$2.32
Book value	$28.57	$26.34	$25.57	$24.86	$20.35		$28.57	$20.35
Cash dividends	$0.37	$0.37	$0.37	$0.37	$0.37		$1.11	$1.11
Average common shares outstanding -basic	3,679,799	3,665,695	3,655,176	3,642,096	3,613,230		3,666,937	3,600,137
Average common shares outstanding -diluted	3,682,773	3,665,695	3,655,176	3,642,096	3,613,230		3,666,937	3,600,137
Selected Ratios:
Return on average assets	0.72%	0.55%	0.59%	0.25%	0.52%		0.62%	0.64%
Return on average shareholders' equity	8.13%	6.14%	6.53%	2.83%	5.88%		6.95%	7.13%
Net interest margin (tax equivalent)	2.48%	2.46%	2.39%	2.36%	2.38%		2.45%	2.40%
Efficiency ratio (tax equivalent)	65.28%	73.26%	72.73%	82.38%	71.59%		70.28%	72.55%
Average shareholders' equity to total average assets	8.80%	8.97%	8.98%	8.93%	8.91%		8.92%	9.01%
Net loan charge-offs (recoveries)	$25	$12	$21	$(19)	$275		$58	$(219)
Net loan charge-offs (recoveries) - annualized / Average loans excluding held-for-sale	0.01%	0.00%	0.01%	-0.01%	0.10%		0.01%	-0.03%
Balance Sheet (Average)
Assets	$1,856,034	$1,798,040	$1,778,585	$1,779,627	$1,773,138		$1,811,051	$1,737,417
Investment securities (AFS & Equities)	552,323	569,135	578,615	604,292	624,423		566,638	636,498
Loans receivable	1,158,731	1,139,874	1,108,836	1,072,616	1,039,170		1,135,898	1,029,042
Deposits	1,600,925	1,542,661	1,497,692	1,490,244	1,488,632		1,547,290	1,443,816
Shareholders' equity	163,274	161,340	159,739	158,987	158,063		161,458	156,499

 

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QNB Corp. (Consolidated)
Average Balances, Rate, and Interest Income and Expense Summary (Tax-Equivalent Basis)
	Three Months Ended
	September 30, 2024										September 30, 2023
	Average			Average							Average			Average
	Balance			Rate			Interest				Balance			Rate			Interest
Assets
Investment securities:
U.S. Treasury	$	12,811			4.94	%	$	159			$	7,111			5.17	%	$	92
U.S. Government agencies		75,956			1.18			224				101,947			1.11			283
State and municipal		105,674			3.74			989				109,157			3.30			901
Mortgage-backed and CMOs		345,119			2.84			2,453				394,607			2.53			2,500
Corporate debt securities and mutual funds		8,804			5.97			131				6,648			4.40			73
Equities		3,959			4.61			46				4,953			4.70			59
Total investment securities		552,323			2.90			4,002				624,423			2.50			3,908
Loans:
Commercial real estate		819,091			5.60			11,525				722,833			5.10			9,288
Residential real estate		110,760			4.21			1,165				107,332			3.81			1,022
Home equity loans		66,239			6.84			1,138				57,694			6.65			967
Commercial and industrial		140,980			7.61			2,696				128,601			7.23			2,343
Consumer loans		3,613			7.75			70				3,823			7.53			73
Tax-exempt loans		18,305			3.88			179				19,630			3.59			178
Total loans, net of unearned income*		1,158,988			5.76			16,773				1,039,913			5.29			13,871
Other earning assets		95,780			5.43			1,307				62,420			5.48			862
Total earning assets		1,807,091			4.86			22,082				1,726,756			4.28			18,641
Cash and due from banks		15,540										15,679
Allowance for loan losses		(8,860	)									(8,396	)
Other assets		42,263										39,099
Total assets	$	1,856,034									$	1,773,138
Liabilities and Shareholders' Equity
Interest-bearing deposits:
Interest-bearing demand	$	356,763			1.00	%		898			$	319,335			0.74	%		600
Municipals		154,619			4.69			1,823				157,391			4.63			1,837
Money market		238,494			3.56			2,132				201,277			3.01			1,527
Savings		278,247			1.28			896				325,567			1.27			1,038
Time < $100		178,228			4.12			1,846				128,884			2.92			947
Time $100 through $250		152,416			4.64			1,777				106,920			3.69			996
Time > $250		49,506			4.61			573				43,856			3.41			377
Total interest-bearing deposits		1,408,273			2.81			9,945				1,283,230			2.26			7,322
Short-term borrowings		34,078			2.18			186				95,568			3.07			740
Long-term debt		30,000			4.75			364				20,000			4.36			222
Subordinated debt		13,716			9.42			323				—			—			—
Total interest-bearing liabilities		1,486,067			2.90			10,818				1,398,798			2.35			8,284
Non-interest-bearing deposits		192,652										205,402
Other liabilities		14,041										10,875
Shareholders' equity		163,274										158,063
Total liabilities and
shareholders' equity	$	1,856,034									$	1,773,138
Net interest rate spread					1.96	%									1.93	%
Margin/net interest income					2.48	%	$	11,264							2.38	%	$	10,357
Tax-exempt securities and loans were adjusted to a tax-equivalent basis and are based on the Federal corporate tax rate of 21%
Non-accrual loans and investment securities are included in earning assets.
* Includes loans held-for-sale

 

 

 

 

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QNB Corp. (Consolidated)
Average Balances, Rate, and Interest Income and Expense Summary (Tax-Equivalent Basis)
	Nine Months Ended
	September 30, 2024										September 30, 2023
	Average			Average							Average			Average
	Balance			Rate			Interest				Balance			Rate			Interest
Assets
Investment securities:
U.S. Treasury	$	8,820			5.10	%	$	337			$	3,618			4.97	%	$	134
U.S. Government agencies		81,800			1.17			718				101,945			1.11			849
State and municipal		107,237			3.56			2,860				109,877			2.64			2,173
Mortgage-backed and CMOs		355,878			2.72			7,262				405,979			1.96			5,971
Corporate debt securities and mutual funds		7,416			5.78			321				6,637			4.41			219
Equities		5,487			3.87			159				8,442			4.07			257
Total investment securities		566,638			2.74			11,657				636,498			2.01			9,603
Loans:
Commercial real estate		798,714			5.47			32,701				700,375			4.79			25,091
Residential real estate		109,463			4.07			3,337				106,817			3.67			2,943
Home equity loans		64,700			6.83			3,307				57,317			6.44			2,762
Commercial and industrial		141,148			7.57			7,997				141,176			7.55			7,977
Consumer loans		3,679			7.78			214				3,942			7.15			211
Tax-exempt loans		18,410			3.86			532				19,984			3.53			527
Total loans, net of unearned income*		1,136,114			5.65			48,088				1,029,611			5.13			39,511
Other earning assets		61,999			5.45			2,530				27,195			5.67			1,153
Total earning assets		1,764,751			4.71			62,275				1,693,304			3.97			50,267
Cash and due from banks		13,880										14,046
Allowance for loan losses		(8,897	)									(8,871	)
Other assets		41,317										38,938
Total assets	$	1,811,051									$	1,737,417
Liabilities and Shareholders' Equity
Interest-bearing deposits:
Interest-bearing demand	$	337,632			0.89	%		2,243			$	314,012			0.52	%		1,227
Municipals		139,810			4.76			4,987				128,270			4.34			4,163
Money market		232,140			3.57			6,196				169,308			2.30			2,913
Savings		288,885			1.28			2,769				363,496			1.18			3,208
Time < $100		168,894			3.98			5,027				113,951			2.30			1,960
Time $100 through $250		141,156			4.53			4,790				104,697			3.42			2,676
Time > $250		50,855			4.49			1,709				36,590			2.80			767
Total interest-bearing deposits		1,359,372			2.72			27,721				1,230,324			1.84			16,914
Short-term borrowings		57,880			2.33			1,010				112,724			2.99			2,518
Long-term debt		26,058			4.63			918				14,267			3.98			430
Subordinated debt		4,605			9.35			323				—			—			—
Total interest-bearing liabilities		1,447,915			2.77			29,972				1,357,315			1.96			19,862
Non-interest-bearing deposits		187,918										213,492
Other liabilities		13,760										10,111
Shareholders' equity		161,458										156,499
Total liabilities and
shareholders' equity	$	1,811,051									$	1,737,417
Net interest rate spread					1.94	%									2.01	%
Margin/net interest income					2.45	%	$	32,303							2.40	%	$	30,405
Tax-exempt securities and loans were adjusted to a tax-equivalent basis and are based on the Federal corporate tax rate of 21%
Non-accrual loans and investment securities are included in earning assets.
* Includes loans held-for-sale

 

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Document and Entity Information	Oct. 22, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Oct. 22, 2024
Entity Registrant Name	QNB Corp.
Entity Central Index Key	0000750558
Entity Emerging Growth Company	false
Entity File Number	0-17706
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Tax Identification Number	23-2318082
Entity Incorporation, State or Country Code	PA
Entity Address, Address Line One	15 North Third Street
Entity Address, Address Line Two	P.O. Box 9005
Entity Address, City or Town	Quakertown
Entity Address, State or Province	PA
Entity Address, Postal Zip Code	18951-9005
City Area Code	215
Local Phone Number	538-5600
Title of 12(b) Security	Common Stock
Trading Symbol	QNBC
Security Exchange Name	NONE

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