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Previous: BLUEGREEN CORP, 10-Q, 1998-08-12 |
Next: RESOURCES ACCRUED MORTGAGE INVESTORS LP SERIES 86, 10-Q, 1998-08-12 |
<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1998
Commission file # 0-28388
CNB CORPORATION
(Exact name of registrant as specified in its charter)
Michigan 38-2662386
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
303 North Main Street, Cheboygan, MI 49721
(Address of principal executive offices, including Zip Code)
(616) 627-7111
(Registrant's telephone number, including area code)
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 (X) No ( )
As of August 6, 1998 there were 1,026,686 shares of the issuer's common stock
outstanding.
<PAGE> 2
PART I - FINANCIAL INFORMATION
ITEM 1- FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEETS (in thousands)
- ------------------------------------------
<TABLE>
<CAPTION>
June 30, December 31,
1998 1997
ASSETS (UNAUDITED)
<S> <C> <C>
Cash and due from banks $ 9,265 $ 6,004
Federal funds sold 8,600 13,300
--------------------- ---------------------
Total cash and cash equivalents 17,865 19,304
Interest-earning deposits 1,000 1,000
Securities available for sale 26,948 19,162
Securities held to maturity(market value of
$ 38,296 in 1998 and $ 42,718 in 1997) 38,066 42,483
Other securities 753 716
Loans, net 105,470 101,797
Premises and equipment, net 2,922 2,686
Other assets 4,049 3,674
--------------------- ---------------------
Total assets $ 197,073 $ 190,822
===================== =====================
LIABILITIES
Deposits
Non-interest bearing $ 30,480 $ 23,769
Interest-bearing 145,531 146,557
--------------------- ---------------------
Total deposits 176,011 170,326
Other liabilities 2,072 2,351
--------------------- ---------------------
Total liabilities 178,083 172,677
--------------------- ---------------------
SHAREHOLDERS' EQUITY
Common stock, $2.50 par value, 2,000,000
shares authorized, shares outstanding
06/30/98-1,025,984; 12/31/97-977,289 2,565 2,443
Additional paid-in capital 8,554 6,583
Retained earnings 7,803 9,066
Unrealized gains(losses) on securities
available for sale, net of tax 68 53
--------------------- ---------------------
Total shareholders' equity 18,990 18,145
--------------------- ---------------------
Total liabilities and shareholders' equity $ 197,073 $ 190,822
===================== =====================
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 3
CONSOLIDATED STATEMENTS OF INCOME(in thousands)
- -----------------------------------------------
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
1998 1997 1998 1997
(UNAUDITED)
INTEREST INCOME
<S> <C> <C> <C> <C>
Loans, including fees $ 2,486 $ 2,384 $ 4,898 $ 4,632
Securities
Taxable 886 773 1,700 1,559
Tax-exempt 114 86 222 184
Federal funds sold 107 129 285 201
-----------------------------------------------------------------
Total interest income 3,593 3,372 7,105 6,576
-----------------------------------------------------------------
INTEREST EXPENSE ON DEPOSITS 1,608 1,496 3,228 2,905
-----------------------------------------------------------------
NET INTEREST INCOME 1,985 1,876 3,877 3,671
Provision for loan losses 25 25 50 50
-----------------------------------------------------------------
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 1,960 1,851 3,827 3,621
-----------------------------------------------------------------
NON-INTEREST INCOME
Service charges and fees 222 196 418 370
Loan sales and servicing fees 59 54 106 86
Other income 55 43 110 93
-----------------------------------------------------------------
Total non-interest income 336 293 634 549
-----------------------------------------------------------------
NON-INTEREST EXPENSES
Salary and employee benefits 741 700 1,390 1,396
Occupancy 154 156 307 305
Supplies 48 44 99 88
Other expenses 270 291 494 511
-----------------------------------------------------------------
Total non-interest expenses 1,213 1,191 2,290 2,300
-----------------------------------------------------------------
INCOME BEFORE INCOME TAXES 1,083 953 2,171 1,870
Income tax expense 328 292 626 568
-----------------------------------------------------------------
NET INCOME $ 755 $ 661 $ 1,545 $ 1,302
=================================================================
Other comprehensive income, net of tax:
Change in unrealized gains (loss) on
securities 7 36 15 23
-----------------------------------------------------------------
Comprehensive income $ 762 $ 697 $ 1,560 $ 1,325
=================================================================
Return on average assets (annualized) 1.58% 1.51% 1.61% 1.49%
Return on average equity (annualized) 16.14% 14.95% 16.51% 14.89%
Basic earnings per share $ 0.74 $ 0.65 $ 1.51 $ 1.27
Diluted earnings per share $ 0.74 $ 0.65 $ 1.51 $ 1.27
</TABLE>
All per share statistics have been retroactively adjusted to reflect the 5%
stock dividends on June 25, 1997 and February 20, 1998.
See accompanying notes to consolidated financial statements.
<PAGE> 4
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY(in thousands)
<TABLE>
<CAPTION>
Unrealized
Gains(Losses)
On Securities
Available for
Common Capital Retained Sale, Net of
Stock Surplus Earnings Tax Total
----- ------- -------- -------------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Balance-January 1, 1997 $ 2,327 $ 4,979 $ 9,749 $ (2) $ 17,053
Net Income, 1997 2,880 2,880
Cash dividends $ 1.79 per (1,841) (1,841)
share 5% stock dividend (a) 116 1,599 (1,722) (7)
Shares issued under stock plan 5 5
Net change in unrealized
gains (losses) on securities
available for sale, net of tax 55 55
-------------------------------------------------------------------------
Balance-December 31, 1997 2,443 6,583 9,066 53 18,145
Net Income YTD 1998 1,545 1,545
Cash dividends $ .70 per (718) (718)
share 5% stock dividend (a) 122 1,968 (2,090)
Shares issued under stock
plan 3 3
Net change in unrealized
gains (losses) on securities
available for sale, net of tax 15 15
-------------------------------------------------------------------------
Balance-June 30, 1998 $ 2,565 $ 8,554 $ 7,803 $ 68 $ 18,990
=========================================================================
</TABLE>
(a) All per share statistics have been retroactively adjusted to reflect the 5%
stock dividends on June 25, 1997 and February 20, 1998.
See accompanying notes to consolidated financial statements.
<PAGE> 5
CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands)
- ----------------------------------------------------
<TABLE>
<CAPTION>
Six months ended June 30,
1998 1997
(unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C>
Net Income $ 1,545 $ 1,302
Adjustments to reconcile net income to net cash
from operating activities
Depreciation 131 134
Accretion and amortization of investment securities, net 19 71
Provision for loan losses 50 50
Loans originated for sale (6,700) (2,040)
Proceeds from sales of loans originated for sale 6,702 2,042
Gain on sales of loans (2) (2)
Increase in other assets (382) (372)
Increase in other liabilities 193 252
-------------- --------------
Total adjustments 11 135
-------------- --------------
Net cash from operating activities 1,556 1,437
-------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities of securities available for sale 2,214 2,000
Purchase of securities available for sale (10,005) (5,666)
Proceeds from maturites of securities held to maturity 11,834 11,942
Purchase of securities held to maturity (7,409) (7,728)
Purchase of other securities (37) (536)
Net increase in portfolio loans (3,723) (6,745)
Premises and equipment expenditures (367) (56)
-------------- --------------
Net cash from investing activities (7,493) (6,789)
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase in deposits 5,685 10,786
Dividends paid (1,190) (1,123)
Proceeds from exercise of stock options 3
-------------- --------------
Net cash from financing activities 4,498 9,663
Net change in cash and cash equivalents (1,439) 4,311
Cash and cash equivalents at beginning of year 19,304 10,104
-------------- --------------
Cash and cash equivalents at end of period $ 17,865 $ 14,415
============== ==============
Cash paid during the period for
Interest $ 3,268 $ 2,527
Income taxes $ 701 $ 680
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE> 6
NOTES TO FINANCIAL STATEMENTS
Note 1 - Basis of Presentation
The consolidated financial statements include the accounts of CNB Corporation
and its wholly-owned subsidiary, Citizens National Bank of Cheboygan, after
elimination of significant intercompany transactions and accounts. The
statements have been prepared by management without audit by independent
certified public accountants. However, these statements reflect all adjustments
(consisting of normal recurring accruals) and disclosures which are, in the
opinion of management, necessary for a fair presentation of the results for the
interim periods presented and should be read in conjunction with the notes to
the financial statements included in the CNB Corporation's Form 10-K for the
year ended December 31, 1997.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to the rules and regulations of the
Securities and Exchange Commission.
Because the results of operations are so closely related to and responsive to
changes in economic conditions, the results for any interim period are not
necessarily indicative of the results that can be expected for the entire year.
Note-2 Earnings Per Share
Basic earnings per share is calculated solely on weighted-average common shares
outstanding. Diluted earnings per share will reflect the potential dilution of
stock options and other common stock equivalents. All prior calculations will be
restated to be comparable to the new methods.
<PAGE> 7
ITEM 2-MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
This discussion provides information about the consolidated financial condition
and results of operations of CNB Corporation and its subsidiary, Citizens
National Bank of Cheboygan ("Bank") for the six month period ending June 30,
1998.
FINANCIAL CONDITION
CNB Corporation's earnings for the six month period ending June 30, 1998 were
$1.5 million, an 18.7% increase over the same period last year. Earnings for the
quarter ending June 30 were $755,000 compared to $662,000 for the same period
last year. The increase can be attributed to an increase in interest as well as
non-interest income. Earnings per share increased to $1.51 per share in 1998
from $1.27 per share in 1997. Return on average assets for the six month period
ending June 30, 1998 was 1.61% compared to 1.49% for the same period last year.
Return on average equity was 16.51% compared to 14.89% last year.
Net interest income for the six months ending June 30, 1998 was $3.9 million
compared to $3.7 million in 1997. For the quarter ending June 30, 1998, net
interest income was $2.0 million compared to $1.9 million for the same period
last year. The increases can be attributed to an increase in volume of
interest-earning assets.
Non-interest income increased 15.5% to $634,000 from the same period last year
which is a result of the Bank selling more residential real estate to the
secondary market. For the six months ending June 30, 1998 the Bank has sold $6.7
million to the secondary market compared to $2.0 million sold in 1997.
Non-interest expenseS decreased slightly for the six months ending June 30, 1998
compared to 1997 while the quarter to quarter comparison saw an increase of
1.9%. There was no significant change in the income tax position of the Company
during the first half of 1998 with the increase corresponding to an increase in
pre-tax income.
SECURITIES
Securities increased $3.4 million or 5.5% since December 31, 1997. The available
for sale portfolio increased to 41.4% up from 31.1% at year-end. Currently, the
Company primarily maintains a short-term securities portfolio.
The amortized cost and fair values of securities were as follows:
<TABLE>
<CAPTION>
Gross Gross
Amortized Unrealized Unrealized Fair
Available for sale Cost Gains Losses Value
------------------------------------------------------------------
JUNE 30, 1998
<S> <C> <C> <C> <C>
U.S. Government and agency $ 24,065 $ 48 $ (11) $ 24,102
State and municipal 2,780 66 2,846
------------------------------------------------------------------
$ 26,845 $114 $ (11) $ 26,948
==================================================================
</TABLE>
<PAGE> 8
<TABLE>
<CAPTION>
Gross Gross
Amortized Unrealized Unrealized Fair
Available for sale Cost Gains Losses Value
------------------------------------------------------------------
DECEMBER 31, 1997
<S> <C> <C> <C> <C>
U.S. Government and agency $16,085 $ 39 $ (8) $16,116
State and municipal 2,997 49 3,046
------------------------------------------------------------------
$19,082 $ 88 $ (8) $19,162
==================================================================
Held to maturity
JUNE 30, 1998
U.S. Government and agency $20,043 $102 $ (9) $20,136
State and municipal 18,023 150 (13) 18,160
------------------------------------------------------------------
$38,066 $252 $(22) $38,296
==================================================================
Held to maturity
DECEMBER 31, 1997
U.S. Government and agency $28,529 $137 $(26) $28,640
State and municipal 13,954 135 (11) 14,078
------------------------------------------------------------------
$42,483 $272 $(37) $42,718
==================================================================
</TABLE>
The amortized cost and fair value of securities by contractual maturity at
current date are shown below, in thousands of dollars.
<TABLE>
<CAPTION>
Available for Sale Held to Maturity
--------------------- --------------------------
Amortized Fair Amortized Fair
Cost Value Cost Value
--------- ----- --------- -----
<S> <C> <C> <C> <C>
Due in one year or less $ 7,230 $ 7,239 $21,128 $21,181
Due after one year through five years 18,771 18,822 13,877 13,965
Due after five years through ten years 844 887 2,851 2,916
Due after ten years 210 234
-------------------------------------------------------------
Total $26,845 $26,948 $38,066 $38,296
=============================================================
</TABLE>
LOANS
Loans at June 30, 1998 increased $3.7 million or 3.6% from December 31, 1997.
Residential real estate mortgages increased for the period by $3.0 million or
4.9% as the Bank continues to retain, rather than sell on the secondary market,
residential mortgages of 15 years or less. As the yield on these loans is
greater than the yield available on the types of securities the Bank invests in,
this increase will help maintain the Bank's net interest margin.
The table below shows total loans outstanding by type, in thousands of dollars,
at June 30, 1998 and December 31, 1997, and their percentage of the total loan
portfolio. All loans are domestic. A quarterly review of loan concentrations at
June 30, 1998 indicates the pattern of loans in the portfolio has not changed.
There is no individual industry with more than a 10% concentration. However, all
tourism related businesses, when combined, total 10.4% of total loans.
<PAGE> 9
<TABLE>
<CAPTION>
June 30, 1998 December 31, 1997
Portfolio loans: Balance % of total Balance % of total
------- ---------- ------- ----------
<S> <C> <C> <C> <C>
Residential real estate $ 63,754 59.55% $ 60,754 58.78%
Consumer 10,659 9.96% 10,009 9.68%
Commercial real estate 20,425 19.08% 20,899 20.22%
Commercial 12,214 11.41% 11,705 11.32%
----------------------------------------------------------------------
107,052 100.00% 103,367 100.00%
Deferred loan origination fees, net (110) (128)
Allowance for loan losses (1,472) (1,442)
----------------- -------------------
$105,470 $101,797
================= ===================
</TABLE>
ALLOWANCE FOR LOAN LOSSES
An analysis of the allowance for loan losses, in thousands of dollars, for the
six months ended June 30, follows:
<TABLE>
<CAPTION>
1998 1997
---------- ----------
<S> <C> <C>
Beginning balance $1,442 $1,361
Provision for loan losses 50 50
Charge-offs (27) (9)
Recoveries 7 13
--------------- ----------------
Ending balance $1,472 $1,415
=============== ================
</TABLE>
The Company had no impaired loans for 1998 and 1997.
CREDIT QUALITY
The Company maintains a high level of asset quality as a result of actively
managing delinquencies, nonperforming assets and potential problem loans. The
Company performs an ongoing review of all large credits to watch for any
deterioration in quality. Nonperforming loans are comprised of: (1) loans
accounted for on a nonaccrual basis; (2) loans contractually past due 90 days or
more as to interest or principal payments (but not included in nonaccrual loans
in (1) above); and (3) other loans whose terms have been renegotiated to provide
a reduction or deferral of interest or principal because of a deterioration in
the financial position of the borrower (exclusive of loans in (1) or (2) above).
The aggregate of nonperforming loans is shown in the table below.
<TABLE>
<CAPTION>
June 30, December 31,
1998 1997
---------- ------------
(In thousands)
<S> <C> <C>
Nonaccrual $ 8 $ 21
Loans past due 90 days or more 169 78
Troubled debt restructurings
=============== ===============
Total nonperforming loans $ 177 $ 99
=============== ===============
Percent of total loans 0.17% 0.10%
</TABLE>
<PAGE> 10
DEPOSITS
The Company's deposit activity increased $5.7 million or 3.3% since December 31,
1997. This growth can be attributed to seasonal activity.
LIQUIDITY AND FUNDS MANAGEMENT
For the first half of 1998, the Company's net cash from operating activities as
well as financing activities allowed the $3.7 million dollar growth in our loan
portfolio. The Company maintains a steady schedule of investment securities
maturing each month to help meet liquidity needs. The Company does not
anticipate any significant changes in its seasonal pattern.
FUNDS MANAGEMENT
The following chart shows the Company's interest rate sensitivity as of June 30,
1998, in thousands:
<TABLE>
<CAPTION>
Up to 4 to 12 1 to 5 Over
3 Months Months Years 5 Years Total
-------- ------ ----- ------- -----
<S> <C> <C> <C> <C> <C>
Federal funds sold $ 8,600 $ $ $ $ 8,600
Interest-earning deposits 1,000 1,000
Taxable investment securities 8,400 19,373 29,316 57,089
Non-taxable investment
securities 99 1,577 3,724 2,525 7,925
Loans 31,199 24,212 34,713 16,818 106,942
-----------------------------------------------------------------------------
Total rate sensitive assets $ 49,298 $ 45,162 $ 67,753 $ 19,343 $ 181,556
===========
Interest-bearing demand
deposits $ 1,461 $ 3,942 $ 9,198 $ $ 14,601
Savings 5,715 5,146 12,004 22,865
Money market savings 20,216 7,395 17,250 44,861
Time deposits 19,186 24,016 19,986 16 63,204
-----------------------------------------------------------------------------
Total rate sensitive liabilities 46,578 40,499 58,438 16 $ 145,531
===========
Gap $ 2,720 $ 4,663 $ 9,315 $ 19,327
------------------------------------------------------------
Cumulative gap $ 2,720 $ 7,383 $ 16,698 $ 36,025
============================================================
Cumulative ratio 105.84% 111.51%
=============================
</TABLE>
Management reviews the rate and term of any callable security in the portfolio.
The probability of call is used as the basis for determining a repricing date.
Management believes that the difference between rate sensitive assets and rate
sensitive liabilities ("Gap") overstates true interest rate sensitivity.
Interest exposure is not as significant as expressed in the above schedule. Even
though the Company has the contractual right to make a change in certain deposit
rates, given its competitive position, management believes that liabilities do
not need to be repriced as soon as rates begin to move.
<PAGE> 11
CAPITAL RESOURCES
The capital ratios of the Company and Bank exceed the regulatory guidelines for
well capitalized institutions. The following table shows the Company's capital
ratios and ratio calculations for the periods ended . Dollars are shown in
millions.
<TABLE>
<CAPTION>
Minimum Required
To Be Well
Minimum Required Capitalized Under
For Capital Prompt Corrective
Actual Adequacy Purposes Action Regulations
--------------------------------------------------------------------------------------
Amount Ratio Amount Ratio Amount Ratio
------ ----- ------ ----- ------ -----
<S> <C> <C> <C> <C> <C> <C>
JUNE 30, 1998
Total capital (to risk weighted assets)
Consolidated $20.2 19.0% $8.5 8.0% $10.6 10.0%
Bank 19.9 19.0% 8.5 8.0% 10.6 10.0%
Tier 1 capital (to risk weighted assets)
Consolidated 18.9 17.8% 4.3 4.0% 6.4 6.0%
Bank 18.9 17.8% 4.3 4.0% 6.4 6.0%
Tier 1 capital (to average assets)
Consolidated 18.9 9.8% 7.7 4.0% 9.7 5.0%
Bank 18.9 9.8% 7.7 4.0% 9.7 5.0%
DECEMBER 31, 1997
Total capital (to risk weighted assets)
Consolidated $18.9 19.0% $8.0 8.0% $10.0 10.0%
Bank 18.9 19.0% 8.0 8.0% 10.0 10.0%
Tier 1 capital (to risk weighted assets)
Consolidated 17.7 17.7% 4.0 4.0% 6.0 6.0%
Bank 17.7 17.7% 4.0 4.0% 6.0 6.0%
Tier 1 capital (to average assets)
Consolidated 17.7 9.9% 7.1 4.0% 8.9 5.0%
Bank 17.7 9.9% 7.1 4.0% 8.9 5.0%
</TABLE>
<PAGE> 12
NET INTEREST INCOME
The following table shows the daily average Consolidated Balance Sheet, revenue
on earning assets (on a pre-tax basis), expense on interest-bearing liabilities,
and the annualized effective rate or yield for the six month periods ending June
30, in thousands:
<TABLE>
<CAPTION>
1998 1997
Average Yield/ Average Yield/
Balance Interest Rate Balance Interest Rate
------- -------- ---- ------- -------- ----
<S> <C> <C> <C> <C> <C> <C>
Interest-earning assets:
Interest-earning
deposits $ 1,000 29 5.80% $
Federal funds sold 9,951 285 5.73% 7,015 188 5.36%
Total securities 65,266 1,893 5.80% 58,512 1,756 6.00%
Loans 104,148 4,898 9.41% 99,105 4,632 9.35%
--------------------------- ---------------------------
Total interest-
earning assets 180,365 7,105 7.88% $164,632 6,576 7.99%
-------------------------- ------------------------------
Cash and due from
banks 6,070 5,442
Premises and
equipment, net 2,759 2,635
Other assets 2,361 2,460
----------- ----------
Total $191,555 $175,169
=========== ==========
Interest-bearing liabilities:
Interest-bearing
demand deposits $ 14,376 170 2.37% 13,575 161 2.37%
Savings 67,366 1,280 3.80% 23,463 334 2.85%
Time deposits 66,218 1,778 5.37% 98,478 2,409 4.89%
--------------------------- ---------------------------
Total interest-
bearing deposits 147,960 3,228 4.36% 135,516 2,904 4.29%
---------------------------- ------------------------------
Non-interest
bearing deposits 23,032 20,503
Other liabilities 1,851 1,658
Shareholders' equity 18,712 17,492
----------- ----------
Total $191,555 $175,169
=========== ==========
Net interest income $3,877 $3,672
============== =============
Net interest spread 3.52% 3.70%
============ =============
Net yield on interest-
earning assets 4.30% 4.46%
============ =============
</TABLE>
<PAGE> 13
YEAR 2000 ISSUE
This global issue poses a threat to businesses everywhere. The problems, which
will evidence themselves in the year 2000, derive from a two digit limitation in
source programming for calendar years. The Company has assembled an internal
technology committee to thoroughly identify and correct any potential problems
in this area well ahead of the year 2000. Our mission is to continue to offer
continuous quality financial services, which meet the needs of the customers and
communities we serve, into the next millennium. We are committed to allocating
sufficient resources, capital, and personnel to accomplish our mission. We will
identify Y2K risk to bank and holding company, develop plans and programs to
lower risk to acceptable levels, develop backup plans for failure and adhere to
regulatory requirements.
ACCOUNTING CHANGES
In 1998, the FASB issued SFAS No. 130, "Reporting Comprehensive Income", which
requires that financial statements include comprehensive income in addition to
net income. SFAS No. 130 is effective for fiscal years beginning after December
15, 1997, beginning with the first interim period.
<PAGE> 14
PART II- OTHER INFORMATION
ITEM 4-SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 6- EXHIBITS AND REPORTS OF FORM 8-K
a.) None
b.) None
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.
CNB Corporation
-----------------------------------------
(Registrant)
Date: August 6, 1998 /s/ Robert E. Churchill
-------------------------- -----------------------------------------
Robert E. Churchill
President and Chief Executive Officer
Date: August 6, 1998 /s/ John F. Ekdahl
-------------------------- -----------------------------------------
John F. Ekdahl
Senior Vice President
Date: August 6, 1998 /s/ Susan A. Eno
-------------------------- -----------------------------------------
Susan A. Eno
Senior Vice President
<PAGE> 15
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
- ----------- -----------
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 9
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> JUN-30-1998
<CASH> 9,265
<INT-BEARING-DEPOSITS> 1,000
<FED-FUNDS-SOLD> 8,600
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 26,948
<INVESTMENTS-CARRYING> 38,066
<INVESTMENTS-MARKET> 38,296
<LOANS> 106,942
<ALLOWANCE> 1,472
<TOTAL-ASSETS> 197,073
<DEPOSITS> 176,011
<SHORT-TERM> 0
<LIABILITIES-OTHER> 2,072
<LONG-TERM> 0
0
0
<COMMON> 2,565
<OTHER-SE> 16,425
<TOTAL-LIABILITIES-AND-EQUITY> 197,073
<INTEREST-LOAN> 4,898
<INTEREST-INVEST> 2,207
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 7,105
<INTEREST-DEPOSIT> 3,228
<INTEREST-EXPENSE> 3,228
<INTEREST-INCOME-NET> 3,877
<LOAN-LOSSES> 50
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 2,290
<INCOME-PRETAX> 2,171
<INCOME-PRE-EXTRAORDINARY> 2,171
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,171
<EPS-PRIMARY> 1.51
<EPS-DILUTED> 1.51
<YIELD-ACTUAL> 4.30
<LOANS-NON> 8
<LOANS-PAST> 169
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 1,442
<CHARGE-OFFS> 27
<RECOVERIES> 7
<ALLOWANCE-CLOSE> 1,472
<ALLOWANCE-DOMESTIC> 1,472
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
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