Citizens & Northern Corporation

01/28/2026 | Press release | Distributed by Public on 01/28/2026 15:11

C&N ANNOUNCES FOURTH QUARTER and YEAR END 2025 UNAUDITED FINANCIAL RESULTS (Form 8-K)

C&N ANNOUNCES FOURTH QUARTER and YEAR END 2025 UNAUDITED FINANCIAL RESULTS

For Immediate Release:

Wellsboro, PA - Citizens & Northern Corporation ("C&N") (NASDAQ: CZNC) announced its unaudited, consolidated financial results for the three-month and twelve-month periods ended December 31, 2025. C&N's principal activity is community banking, and its largest subsidiary is Citizens & Northern Bank ("C&N Bank").

Highlights:

● On October 1, 2025, C&N completed its previously announced merger with Susquehanna Community Financial, Inc., ("Susquehanna"). Susquehanna contributed, after fair value purchase accounting adjustments, approximately $596.2 million in total assets, $393.6 million in total loans, and $501.5 million in deposits at October 1, 2025. Earnings for the fourth quarter and year ended December 31, 2025 were significantly impacted by the Susquehanna acquisition, including the effects of merger-related expenses, net of tax, totaling $5,500,000 in the fourth quarter and $6,350,000 in the year ended December 31, 2025. Further, the addition of Susquehanna contributed to the growth in net interest income, noninterest income and noninterest expenses.
● Net income was $4,466,000, or $0.25 diluted earnings per share for the fourth quarter 2025 as compared to $6,551,000, or $0.42 per diluted share in the third quarter 2025 and $8,174,000, or $0.53 per diluted share in the fourth quarter 2024. Net income for the year ended December 31, 2025 was $23,427,000, or $1.46 diluted earnings per share, as compared to $25,958,000, or $1.69 diluted earnings per share for the year ended December 31, 2024.
● Excluding merger-related expenses, net of taxes, adjusted earnings (non-GAAP) totaled $9,966,000 or $0.56 per diluted share for the fourth quarter of 2025 as compared to $7,248,000 or $0.47 per diluted share for the third quarter 2025. For the year ended December 31, 2025, excluding merger-related expenses, net of taxes, adjusted earnings (non-GAAP) totaled $29,777,000 or $1.85 per diluted share. Management believes disclosure of unaudited earnings results, adjusted to exclude the impact of merger-related expenses, provides useful information to investors for comparative purposes. See table titled "Adjusted Ratios for Merger-Related Expenses- Non-GAAP Reconciliation" for additional information.
● Net interest income for the fourth quarter 2025 increased $6,210,000 over the total for the third quarter 2025 and $8,000,000 over the total for fourth quarter 2024. The net interest margin was 3.84% in the fourth quarter 2025, up from 3.62% in the third quarter 2025 and 3.30% in the fourth quarter 2024. For the year ended December 31, 2025, net interest income was $12,738,000 higher than in 2024. The net interest margin was 3.61% for the year ended December 31, 2025, up from 3.30% in 2024. Net interest income included the impact of accretion of purchase accounting valuation adjustments related to the Susquehanna acquisition of $789,000 in the fourth quarter and year ended December 31, 2025, including $486,000 of accretion on loans and $303,000 of accretion on time deposits.
● The provision for credit losses was $1,320,000 in the fourth quarter 2025 as compared to $2,354,000 in the third quarter 2025 and a credit for credit losses (reduction in expense) of $531,000 in the fourth quarter 2024. For the year ended December 31, 2025, the provision for credit losses was $6,073,000 as compared to $2,195,000 for the year ended December 31, 2024. The allowance for credit losses on loans ("ACL") was 1.32% of gross loans receivable at December 31, 2025, up from 1.21% at September 30, 2025 and 1.06% at December 31, 2024. The increase in the ACL includes an additional allowance of $7,074,000 recorded effective October 1, 2025 for loans recorded as part of the Susquehanna acquisition.
● Total loans receivable were $409,258,000 higher at December 31, 2025 compared to September 30, 2025. Total loans receivable acquired in the Susquehanna acquisition amounted to $393,587,000 at October 1, 2025. Average loans receivable increased $419,273,000 during the fourth quarter from the third quarter 2025 and increased $137,995,000 or 7.3% for the year ended December 31, 2025 as compared to 2024.
● Nonperforming assets totaled $33,113,000, or 1.06% of total assets, at December 31, 2025, up from $27,189,000, or 1.02% of total assets, at September 30, 2025 and $24,142,000, or 0.92% of total assets at December 31, 2024. Included in nonperforming assets were $6,762,000 of purchase credit deteriorated ("PCD") loans acquired as part of the merger.

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● Deposits totaled $2,564,716,000 at December 31, 2025, up $398,918,000 from September 30, 2025. Deposits of $501,488,00 were assumed in the merger. Average total deposits increased $502,674,000 during the fourth quarter 2025 from the third quarter 2025 and were $170,214,000 or 8.3% higher for the year ended December 31, 2025, as compared to the year ended December 31, 2024. Average brokered deposits decreased $50,415,000 to $11,123,000 for the year ended December 31, 2025 from $61,538,000 for the year ended December 31, 2024.

Completion of Merger with Susquehanna Community Financial, Inc.

On October 1, 2025, C&N completed its previously announced merger with Susquehanna. Susquehanna was the parent company of Susquehanna Community Bank, a community bank offering a full range of banking services to the central Pennsylvania market through its seven banking offices located in Lycoming, Northumberland, Snyder and Union counties in Pennsylvania. Pursuant to the Agreement and Plan of Merger dated April 23, 2025 between C&N and Susquehanna, Susquehanna merged with and into C&N, with C&N as the surviving corporation in the Merger. Immediately following the completion of the Merger, Susquehanna Community Bank, the wholly owned subsidiary of Susquehanna, merged with and into C&N Bank, with C&N Bank surviving. Upon completion of the merger, shareholders of Susquehanna became entitled to exchange each share of Susquehanna common stock owned for 0.80 shares of C&N common stock. Cash was issued in lieu of fractional shares resulting from the conversion of Susquehanna's stock. In total, C&N issued approximately 2.3 million shares of common stock to the former Susquehanna stockholders, resulting in total merger consideration valued at $44.6 million and an increase in C&N's stockholders' equity of $44.4 million, net of equity issuance costs.

In connection with the acquisition, tangible common book value per share (a non-GAAP ratio) was diluted by $0.56, or 3.6%, as C&N recorded goodwill of $10.8 million and a core deposit intangible asset of $10.7 million. Assets acquired included loans valued at $393.6 million, cash and due from banks of $6.1 million, bank-owned life insurance valued at $8.0 million and securities valued at $147.6 million. Liabilities assumed included deposits valued at $501.5 million and short-term borrowings valued at $45.8 million. The accretable discount on acquired loans at origination was $7.2 million, or approximately 1.8% of Susquehanna's amortized cost basis. The estimated average life of the acquired loans at origination was 4.6 years.

The assets purchased and liabilities assumed in the acquisition were recorded at their preliminary estimated fair values at the time of closing and may be adjusted for up to one year subsequent to the acquisition.

In November 2025, the Financial Accounting Standards Board issued Accounting Standards Update 2025-08, Financial Instruments - Credit Losses (ASU 2025-08). C&N adopted ASU 2025-08 in accounting for the Susquehanna acquisition. Consistent with ASU 2025-08, C&N recorded loans receivable at fair value plus an allowance for credit losses of $7.1 million, including allowances totaling $2.6 million on loans with more than insignificant deterioration in credit quality subsequent to origination ("PCD") loans and an allowance of $4.5 million on non-PCD loans. At origination, the recorded value of loans receivable included PCD loans totaling $23.7 million.

C&N incurred pre-tax merger-related expenses related to the Susquehanna transaction of $7,940,000 for the year ended December 31, 2025, including expenses totaling $6,891,000 in the fourth quarter of 2025. Merger-related expenses include expenses related to conversion of Susquehanna's core customer system data into C&N's core system, severance and legal and other professional expenses.

Fourth Quarter 2025 as Compared to Third Quarter 2025

Net income was $4,466,000, or $0.25 per diluted share, for the fourth quarter 2025 as compared to $6,551,000, or $0.42 per diluted share, for the third quarter 2025. As described above, excluding the effects of merger-related expenses, adjusted earnings (non-GAAP) per share were $0.56 for the fourth quarter and $0.47 per diluted share for the third quarter 2025. Other significant variances were as follows:

◾ Net interest income of $28,473,000 in the fourth quarter 2025 increased $6,210,000 from the third quarter 2025 result. The addition of Susquehanna contributed significantly to increases of $6,919,000 in interest income from loans receivable and $1,014,000 in interest income on available-for-sale securities as average loans receivable increased $419,273,000, and average available-for-sale debt securities increased $86,117,000. The Susquehanna merger resulted in an initial increase in total available-for-sale debt securities of $147,617,000. The majority of Susquehanna's debt securities were subsequently sold, and a significant portion of the proceeds were used to purchase available-for-sale debt securities resulting in an increase in the average yield on the portfolio to 3.03%

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from 2.71%. Interest expense on interest-bearing deposits increased $1,687,000 from the third quarter as average total deposits increased $502,674,000 reflecting the impact of the merger while average total borrowed funds decreased $10,852,000 in the fourth quarter 2025 from the total for the prior quarter. The net interest margin was 3.84% in the fourth quarter 2025, up 0.22% from 3.62% in the third quarter 2025. Accretion of purchase accounting valuation adjustments related to the Susquehanna merger had a net positive impact on net interest income of $789,000 in the fourth quarter 2025, including accretion of $486,000 on loans and $303,000 on time deposits. The net interest spread increased 0.37%, as the average yield on earning assets increased 0.12% and the average rate on interest-bearing liabilities decreased 0.25%.
◾ The provision for credit losses was $1,320,000 in the fourth quarter 2025, a decrease of $843,000 compared to $2,163,000 in the third quarter 2025. The provision for the fourth quarter 2025 included a provision related to loans receivable of $1,384,000 and a credit related to off-balance sheet exposures of $64,000. The provision in the fourth quarter of 2025 resulted mainly from an increase in estimated future net charge-offs related to C&N's loss experience, partially offset by a decrease resulting from changes in an economic forecast. In the fourth quarter 2025, net charge-offs totaled $884,000 or 0.15% (annualized) of average loans receivable compared to net charge-offs of $94,000 or 0.02% (annualized) of average loans receivable in the third quarter 2025. During the fourth quarter 2025, there was a partial charge-off of $763,000 on a non-owner occupied commercial real estate loan with no individual allowance at September 30, 2025. After the impact of the partial charge-off, the amortized cost basis of the loan was $1,441,000 at December 31, 2025. The ACL on loans was 1.32% of gross loans receivable at December 31, 2025, up from 1.21% at September 30, 2025. As discussed above, the increase in the ACL included the addition of $7,074,000 for loans recorded as a result of the merger.
◾ Noninterest income, excluding realized gains on available-for-sale securities, of $8,360,000 in the fourth quarter 2025 increased $1,056,000 from the third quarter 2025 result including $665,000 from the former Susquehanna operations. Brokerage and insurance revenue increased $281,000, service charges on deposit accounts increased $172,000, other noninterest income increased $159,000, net gains from sale of loans increased $150,000, and loan servicing fees, net increased $118,000 from the third quarter 2025.
◾ Noninterest expense, excluding merger-related expenses of $6,891,000, totaled $23,268,000 in the fourth quarter of 2025, an increase of $4,761,000 from the similarly adjusted total for the third quarter of 2025. The increase in noninterest expense resulted mainly from the Susquehanna acquisition. Other significant variances included the following:
Ø Salaries and employee benefits expense of $13,267,000 increased $1,974,000, including the impact of the Susquehanna acquisition offset by a decrease of $256,000 in cash and stock-based compensation expense.
Ø Professional fees of $1,291,000 increased $846,000 from third quarter 2025 including consulting fees totaling $757,000 related to contract renegotiations with technology core system and operations providers.
Ø Other noninterest expense of $3,284,000 increased $788,000 from the third quarter 2025 as core deposit intangible amortization expense increased $773,000 related to core deposits assumed from Susquehanna.
◾ The income tax provision of $926,000, or 17.2% of pre-tax income for the fourth quarter 2025 decreased $538,000 from $1,464,000, or 18.3% of pre-tax income, for the third quarter 2025 reflecting a decrease in pre-tax income for the quarter.

Fourth Quarter 2025 as Compared to Fourth Quarter 2024

Fourth quarter 2025 net income was $4,466,000, or $0.25 per diluted share, as compared to $8,174,000, or $0.53 per diluted share, in the fourth quarter 2024. As described above, excluding the effects of merger-related expenses, adjusted earnings (non-GAAP) per share were $0.56 per diluted share for the fourth quarter 2025. Significant variances were as follows:

◾ Net interest income of $28,473,000 in the fourth quarter 2025 was $8,000,000 higher than in the fourth quarter 2024, including the benefit of income from growth in net earning assets resulting from the Susquehanna merger.

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The net interest margin increased to 3.84% in the fourth quarter 2025 from 3.30% in the fourth quarter 2024. The interest rate spread increased 0.72%, as the average yield on earning assets increased 0.22% while the average rate on interest-bearing liabilities decreased 0.50%. Average total earning assets increased $471,115,000 from the fourth quarter 2024, as average total loans receivable increased $452,332,000, including the impact of loans acquired from Susquehanna, and average available-for-sale debt securities increased $85,134,000 while average interest-bearing due from banks decreased $67,232,000. As discussed above, the majority of Susquehanna's debt securities were subsequently sold after the completion of the acquisition, and a significant portion of the proceeds were used to purchase available-for-sale debt securities, contributing to an increase in the average yield to 3.03% from 2.52%. Average total deposits increased $502,113,000, including the impact of deposits assumed from Susquehanna, while average brokered deposits decreased $30,357,000. Average total borrowed funds decreased $44,502,000.
◾ As discussed in more detail above, the provision for credit losses was $2,163,000 for the fourth quarter 2025, compared to a credit for credit losses of $531,000 in the fourth quarter 2024. In the fourth quarter 2025, net charge-offs totaled $884,000 or 0.15% (annualized) of average loans receivable compared to net charge-offs of $14,000 or 0.00% (annualized) of average loans receivable in the fourth quarter 2024. The ACL as a percentage of gross loans receivable was 1.32% at December 31, 2025, an increase from 1.06% at December 31, 2024. The increase in the ACL included an additional allowance of $7,074,000 for loans recorded as part of the Susquehanna acquisition.
◾ Noninterest income, excluding gains on available-for-sale debt securities, of $8,360,000 in the fourth quarter 2025 increased $813,000 from the fourth quarter 2024 result, including $665,000 of noninterest income resulting from the Susquehanna acquisition. Net gains from sale of loans increased $186,000, other noninterest income increased $170,000, interchange revenue from debit card transactions increased $161,000 and service charges on deposit accounts increased $112,000 from the fourth quarter 2024.
◾ Noninterest expense, excluding merger-related expenses of $6,891,000, totaled $23,268,000 in the fourth quarter of 2025, an increase of $4,838,000 from the fourth quarter of 2024. The increase in noninterest expense resulted mainly from the Susquehanna acquisition. Other significant variances included the following:
Ø Other noninterest expense of $3,284,000 increased $859,000 from the fourth quarter 2025 as core deposit intangible amortization expense increased $773,000 related to core deposits assumed from Susquehanna.
Ø Professional fees of $1,291,000 increased $741,000 from third quarter 2025, including consulting fees totaling $757,000 related to contract renegotiations with technology core system and operations providers.
◾ The income tax provision of $926,000, or 17.2% of pre-tax income for the fourth quarter 2025 decreased $1,021,000 from $1,947,000, or 19.2% of pre-tax income, for the fourth quarter reflecting a decrease in pre-tax income for the quarter.

Year Ended December 31, 2025 as Compared to Year Ended December 31, 2024

Net income for the year ended December 31, 2025 was $23,427,000 or $1.46 per diluted share, as compared to $25,958,000, or $1.69 per diluted share, for the year ended December 31, 2024. Excluding the impact of merger-related expenses, net of tax, adjusted earnings (non-GAAP) for the year ended December 31, 2025 were $29,777,000 or $1.85 per diluted share. Significant variances were as follows:

◾ Net interest income totaled $91,853,000 for the year ended December 31, 2025, an increase of $12,738,000 from 2024 including the benefit of three months of income from growth in net earning assets resulting from the Susquehanna merger. Average total loans increased $137,995,000 or 7.3% and average total deposits increased $170,215,000, or 8.3%. Average brokered deposits decreased $50,415,000 to $11,123,000 for the year ended December 31, 2025 from $61,538,000 for the year ended December 31, 2024, while average total borrowed funds decreased $44,254,000. The net interest margin was 3.61% for the year ended December 31, 2025, up from 3.30% in the corresponding period of 2024. The interest rate spread increased 0.38%, as the average rate on interest-bearing liabilities was 0.25% lower while the average yield on earning assets increased 0.13%.

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◾ For the year ended December 31, 2025, the provision for credit losses was $6,073,000, up from $2,195,000 in 2024. The provision for the year ended December 31, 2025 included the impact of increases in the ACL related to changes in qualitative factors. The ACL increased $11,013,000, to 1.32% of loans receivable at December 31, 2025 as compared to 1.06% at December 31, 2024, including the impact of an increase in the ACL attributable to the Susquehanna acquisition and an increase related to changes in qualitative factors. For the year ended December 31, 2025, net charge-offs totaled $1,617,000, or 0.08% of average loans receivable as compared to net charge-offs for 2024 of $1,603,000, or 0.09% of average loans receivable.
◾ Noninterest income, excluding realized gains on available-for-sale debt securities, totaled $30,814,000 for the year ended December 31, 2025, up $1,605,000 from the total for the year ended December 31, 2024 including the impact from the Susquehanna acquisition of $665,000 in noninterest income. Significant variances included the following:
Ø Other noninterest income of $5,637,000 increased $407,000 including increases in credit enhancement fees of $117,000, income from merchant services of $66,000, interchange revenue from credit cards of $65,000, income from tax credits related to donations of $51,000 and letter of credit fees of $49,000.
Ø Interchange revenue from debit card transactions of $4,623,000 increased $347,000, including an increase in volume-related incentive income.
Ø Net gains from sale of loans of $1,483,000 increased $325,000, reflecting an increase in volume of residential mortgage loans sold and includes the impact of $146,000 in net gains from sale of loans resulting from the Susquehanna acquisition.
Ø Trust revenue of $8,212,000 increased $284,000, consistent with appreciation in the trading prices of many U.S. equity securities and included an increase in estate fees.
◾ Noninterest expense, excluding merger-related expenses of $7,940,000, totaled $80,049,000 for the year ended December 31, 2025, an increase of $5,791,000 from the total for the year ended December 31, 2024. The increase in noninterest expense included the impact of the Susquehanna acquisition. Other significant variances included the following:

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Ø Salaries and employee benefits expense of $47,386,000 increased $2,456,000, including the impact of the Susquehanna acquisition and an increase of $387,000 in cash and stock-based incentive compensation.
Ø Other noninterest expense of $11,535,000 increased $1,174,000. Within this category, other significant variances included the following:
◾ Core deposit intangible amortization expense increased $808,000, including $773,000 related to core deposits assumed from Susquehanna.
◾ In 2025, there was a reduction in expense associated with the defined benefit postretirement medical benefit plan of $65,000. In comparison, in 2024, there was a reduction in expense of $527,000 related to the defined benefit postretirement medical benefit plan, including a curtailment gain of $469,000.
◾ Legal fees unrelated to merger activity totaled $299,000 for the year ended December 31, 2025, a decrease of $305,000 from the total for 2024.
◾ The income tax provision of $5,216,000, or 18.2% of pre-tax income for the year ended December 31 2025 decreased $697,000 from $5,913,000, or 18.6% of pre-tax income for the year ended December 31, 2024. The decrease in income tax provision was consistent with the decrease in pre-tax income of $3,228,000.

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Other Information:

Changes in other unaudited financial information were as follows:

◾ Total assets were $3,132,469,000 at December 31, 2025 up from $2,664,033,000 at September 30, 2025 and up from $2,610,653,000 at December 31, 2024.
◾ Cash and due from banks totaled $46,056,000 at December 31, 2025, down from $123,090,000 at September 30, 2025 and $126,174,000 at December 31, 2024.
◾ The fair value of available-for-sale debt securities at December 31, 2025 was lower than the amortized cost basis by $29,685,000 or 5.5%. In comparison, the aggregate unrealized loss position was $33,786,000 or 7.5% lower than the amortized cost basis at September 30, 2025 and $47,543,000 or 10.0% lower than the amortized cost basis at December 31, 2024.. The volatility in the fair value of the portfolio has resulted from changes in interest rates. Management reviewed the available-for-sale debt securities as of December 31, 2025 and concluded, as of such date, that there were no credit-related declines in fair value and no allowance for credit losses was recorded as of December 31, 2025.
◾ Gross loans receivable totaled $2,354,365,000 at December 31, 2025, an increase of $409,258,000 from total loans at September 30, 2025 and an increase of $458,517,000 from total loans at December 31, 2024 including $393,587,000 of gross loans receivable, net of purchase accounting adjustments, recorded effective October 1, 2025 due to acquisition of Susquehanna. In comparing outstanding balances at December 31, 2025 and 2024, total commercial loans were up $376,154,000 or 26.4%, total outstanding consumer loans increased $46,422,000 or 72.6% and total residential mortgage loans increased $35,941,000 or 8.8%. The outstanding balance of residential mortgage loans originated and serviced by C&N that have been sold to third parties was $450,120,000 at December 31, 2025, up $120,354,000 from the total at December 31, 2024, reflecting the impact of servicing obligations assumed on such loans that had been sold by Susquehanna prior to the merger.
◾ At December 31, 2025, the recorded investment in non-owner occupied commercial real estate loans for which the primary purpose is utilization of office space by third parties was $125,175,000, or 5.3% of gross loans receivable. Within this segment there were two loans with a total amortized cost basis of $2,787,000 in nonaccrual status with no individual allowances and the remainder of the non-owner occupied commercial real estate loans with a primary purpose of office space utilization were in accrual status with no individual allowance at December 31, 2025.
◾ Total nonperforming assets as a percentage of total assets was 1.06% at December 31, 2025, up from 1.02% at September 30, 2025 and 0.92% at December 31, 2024. Total nonperforming assets were $33,113,000 at December 31, 2025, up from $27,189,000 at September 30, 2025 and $24,142,000 at December 31, 2024, including the impact of nonaccrual PCD loans a acquired as part of the merger with a total amortized cost basis of $6,762,000 at December 31, 2025.
◾ Deposits totaled $2,564,716,000 at December 31, 2025, up $398,981,000 from September 30, 2025 and $470,807,000 from December 31, 2024. Deposits of $501,488,000 were assumed from Susquehanna, effective October 1, 2025. After the impact of the initial balances of deposits assumed from Susquehanna, total deposits were down $102,507,000 at December 31, 2025, mainly due to seasonal declines in balances maintained by municipal customers. At December 31, 2025, C&N's estimated uninsured deposits totaled $811.2 million, or 31.4% of the Bank's total deposits, as compared to $696.5 million, or 31.9% of the Bank's total deposits at September 30, 2025 and $632.8 million, or 30.0% of the Bank's total deposits at December 31, 2024. Included in uninsured deposits are deposits collateralized by securities (almost exclusively municipal deposits) totaling $172.6 million, or 6.7% of the Bank's total deposits, at December 31, 2025 as compared to $162.0 million, or 7.7% of the Bank's total deposits at December 31, 2024.
◾ C&N maintained highly liquid sources of available funds totaling $1.206 billion at December 31, 2025, including unused borrowing capacity with the Federal Home Loan Bank of Pittsburgh of $785.8 million, unused availability on the Federal Reserve Bank of Philadelphia's discount window of $25.5 million, available federal funds lines with other banks of $75 million and available-for-sale debt securities with a fair value in excess of collateral obligations of $319.6 million. At December 31, 2025, available funding from these sources totaled 148.7% of uninsured deposits, and 188.8% of uninsured and uncollateralized deposits.
◾ The outstanding balance of borrowed funds, including Federal Home Loan Bank advances, repurchase agreements, senior notes and subordinated debt, totaled $189,742,000 at December 31, 2025, up $15,488,000 from September 30, 2025 and down $17,957,000 from December 31, 2024.

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◾ Total stockholders' equity was $341,714,000 at December 31, 2025, up from $293,959,000 at September 30, 2025 and $275,284,000 at December 31, 2024. Effective October 1, 2025, C&N recorded a net increase in stockholders' equity of $44,388,0000 from the issuance of common stock to the former Susquehanna stockholders. Within stockholders' equity, the portion of accumulated other comprehensive loss related to available-for-sale debt securities was $23,154,000 at December 31, 2025, $26,352,000 at September 30, 2025 and $37,084,000 at December 31, 2024. The volatility in stockholders' equity related to accumulated other comprehensive loss from available-for-sale debt securities has been caused by fluctuations in interest rates including overall increases in rates as compared to market rates when most of C&N's securities were purchased. Accumulated other comprehensive loss is excluded from C&N's regulatory capital ratios.
◾ On September 25, 2023, C&N announced a treasury stock repurchase program with no expiration that can be suspended or terminated by the Board of Directors, in its sole discretion. Under this program, C&N is authorized to repurchase up to 750,000 shares of its common stock. During the three-month period and the year ended December 31, 2025, 501 shares were repurchased for a total cost of $9,534, at an average price of $19.03 per share. At December 31, 2025, there were 723,465 shares available to be repurchased under the program.
◾ Citizens & Northern Corporation and Citizens & Northern Bank are subject to various regulatory capital requirements. At December 31, 2025, Citizens & Northern Corporation and Citizens & Northern Bank maintained regulatory capital ratios that exceeded all capital adequacy requirements and were classified as well-capitalized.
◾ Trust assets under management by C&N's Wealth Management Group were $1,468,691,000 at December 31, 2025, up from $1,436,257,000 at September 30, 2025, and up 9.0% from $1,347,853,000 at December 31, 2024. Fluctuations in values of assets under management reflect the impact of market volatility.
◾ Under U.S. GAAP, interest income on tax-exempt securities and loans is reported at applicable nominal amounts, with the tax benefit accounted for as a reduction in the income tax provision. C&N presents certain analyses and ratios with net interest income determined on a fully taxable-equivalent basis, which are non-GAAP financial measures as presented. C&N believes presentation of net interest income on a fully taxable-equivalent basis provides investors with meaningful information for purposes of comparing the returns on tax-exempt securities and loans with returns on taxable securities and loans. The excess of net interest income on a fully taxable-equivalent basis over the amounts reported under U.S. GAAP was $233,000, $218,000 and $217,000 for the fourth quarter 2025, third quarter 2025 and fourth quarter 2024, respectively. The excess of net interest income on a fully taxable-equivalent basis over the amounts reported under U.S. GAAP was $882,000 for the year ended December 31, 2025 and $819,000 for the year ended December 31, 2024.

Citizens & Northern Corporation is the bank holding company for Citizens & Northern Bank, headquartered in Wellsboro, Pennsylvania, which operates 35 banking offices located in Bradford, Bucks, Cameron, Chester, Lancaster, Lycoming, McKean, Northumberland, Potter, Snyder, Sullivan, Tioga, Union and York Counties in Pennsylvania and Steuben County in New York, as well as a loan production office in Elmira, New York. Citizens & Northern Corporation trades on NASDAQ under the symbol "CZNC." For more information about Citizens & Northern Bank and Citizens & Northern Corporation, visit www.cnbankpa.com.

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