MANSFIELD, Pa., Jan. 29, 2026 /PRNewswire/ -- Citizens Financial Services, Inc (Nasdaq: CZFS), parent company of First Citizens Community Bank (the "Bank"), released today its unaudited consolidated financial results for the three months and year ended December 31, 2025.
Highlights
- Net income was $36,572,000 for 2025, which is $8,754,000, or 31.5%, more than 2024's net income due to the increase in net interest income after the provision for credit losses of $11,758,000. The effective tax rate for 2025 was 18.9% compared to 17.4% in 2024.
- Net income was $10,483,000 for the three months ended December 31, 2025, which was $2,500,000 more than the net income for 2024's comparable period due to an increase in net interest income after the provision for credit losses of $2,838,000. The effective tax rate for the three months ended December 31, 2025 was 19.0% compared to 16.4% in the comparable period in 2024.
- Net interest income before the provision for credit losses was $98,001,000 for 2025, an increase of $11,546,000, or 13.4%, over 2024 and was primarily due to an increase in investment income and a decrease in interest expense.
- The provision for credit losses for the three months and the year ended December 31, 2025 was $500,000 and $2,375,000, respectively, compared to no provision and $2,587,000 for the three months and the year ended December 31, 2024, respectively. The provision for the 2025 periods was driven by the current economic forecasts and specific reserves for non-accrual loans at December 31, 2025. The provision for 2024 was significantly impacted by loans that were not sold as part of the sale of a division known as Braavo that occurred in the first quarter of 2024. The vast majority of the Braavo loans that were retained after the sale were originated by Huntington Valley Bank in 2023 prior to the acquisition and were current as of the acquisition date in 2023. The provision for 2024, directly attributable to these loans, was $1,806,000.
- Return on average equity for the three months (annualized) and the year ended December 31, 2025 was 12.53% and 11.51% compared to 10.63% and 9.59% for the three months (annualized) and the year ended December 31, 2024, respectively. If the provision for the credit losses attributable to the Braavo loans and the gain on the sale of Braavo are excluded, the return on average equity for the year ended December 31, 2024 would have been 9.84% (non-GAAP) (1).
- Return on average tangible equity (non-GAAP) for the three months (annualized) and the year ended December 31, 2025 was 17.01% and 15.94% compared to 15.10% and 13.84% for the three months (annualized) and the year ended December 31, 2024, respectively. If the provision for the credit losses attributable to the Braavo loans and the gain on the sale of Braavo are excluded, the return on average tangible equity for the year ended December 31, 2024 would have been 14.19% (annualized) (1).
- Return on average assets for the three months (annualized) and the year ended December 31, 2025 was 1.37% and 1.21% compared to 1.06% and 0.93% for the three months (annualized) and the year ended December 31, 2024, respectively. If the provision for the credit losses attributable to the Braavo loans and the gain on the sale of Braavo are excluded, the return on average assets for the year ended December 31, 2024 would have been 0.96% (non-GAAP). (1).
- Non-performing assets increased $578,000 since December 31, 2024 and totaled $29,190,000 as of December 31, 2025. During the fourth quarter of 2025, the Bank recognized additional interest income of $878,000 from payments associated with two relationships that were previously on non-accrual status, and charged-off interest of $577,000 related to two relationships being placed on non-accrual status in the fourth quarter. As a percent of total loans, non-performing assets totaled 1.24% as of December 31, 2025 and 2024.
2025 Compared to 2024
- For 2025, net income totaled $36,572,000 which compares to net income of $27,818,000 for 2024, an increase of $8,754,000. Basic and diluted earnings per share were $7.62 for 2025 compared to $5.80 and $5.79 per share, respectively, for 2024. Return on equity for 2025 and 2024 was 11.51% and 9.59%, while return on assets was 1.21% and 0.93%, respectively. The increase in performance when comparing 2025 to 2024 was due to an increase in the net interest margin from 3.13% to 3.50%.
- Net interest income before the provision for credit losses for 2025 totaled $98,001,000 compared to $86,455,000 for 2024, an increase of $11,546,000, or 13.4%. Average interest earning assets increased $37,517,000 in 2025 compared to 2024, primarily due to an increase in taxable investments and average outstanding student loans. Average loans increased $19,425,000, while average investment securities increased $22,647,000. The yield on interest earning assets increased 10 basis points to 5.66%, while the cost of interest-bearing liabilities decreased 31 basis points to 2.69%. As a result, the tax effected net interest margin increased from 3.13% for 2024 to 3.50% for 2025.
- The provision for credit losses for 2025 was $2,375,000 compared to $2,587,000 for 2024, a decrease of $212,000. The provision for 2025 was driven by the economic forecasts and the annual update of loss drivers, which includes historical loss data, as well as prepayment and curtailment speeds. Additionally, the provision for 2025 was driven by specific loss reserves on two commercial real estate loans and one other commercial loan placed on non-accrual status in the fourth quarter of 2025. The provision for 2024 was impacted by the Braavo loans as previously mentioned and an increase in past due and classified loans during the second quarter of 2024.
- Total non-interest income was $14,344,000 for 2025, which is $1,057,000 less than the non-interest income of $15,401,000 for 2024. The primary drivers were the gain on the sale of assets associated with Braavo and earnings on bank owned life insurance due to the passing of a former employee in the first quarter of 2024.
- Total non-interest expenses for 2025 totaled $64,882,000 compared to $65,586,000 for 2024, which is a decrease of $704,000. Salary and benefit costs increased $55,000 due to additional healthcare expenses and post-employment benefits. There are 12 fewer FTEs in 2025 compared to 2024. The decrease in professional fees and software costs is due to the sale of the Braavo division in 2024.
- The provision for income taxes increased $2,651,000 when comparing 2025 to 2024 as a result of an increase in income before income tax of $11,405,000. The effective tax rate was 18.9% and 17.4% for 2025 and 2024, respectively.
Three Months Ended December 31, 2025 Compared to 2024
- For the three months ended December 31, 2025, net income totaled $10,483,000 which compares to net income of $7,983,000 for the comparable period of 2024, an increase of $2,500,000 or 31.3%. Basic earnings per share of $2.19 for the three months ended December 31, 2025 compares to $1.66 for the 2024 comparable period. Annualized return on equity for the three months ended December 31, 2025 and 2024 was 12.53% and 10.63%, while annualized return on assets was 1.37% and 1.06%, respectively.
- Net interest income before the provision for credit losses for the three months ended December 31, 2025 totaled $26,211,000 compared to $22,873,000 for the three months ended December 31, 2024, resulting in an increase of $3,338,000, or 14.6%. Average interest earning assets increased $33,040,000 for the three months ended December 31, 2025 compared to the same period last year, primarily due to increases in the average balance of investments and loans. Average loans increased $16,828,000, while average investment securities increased $17,206,000. The tax effected net interest margin for the three months ended December 31, 2025 was 3.69% compared to 3.26% for the same period last year. The yield on interest earning assets increased 12 basis points to 5.77%, while the cost of interest-bearing liabilities decreased 35 basis points to 2.59%.
- The provision for credit losses for the fourth quarter of 2025 of $500,000 was driven by specific reserves on two commercial real estate loans and one other commercial loan placed on non-accrual status in the fourth quarter of 2025. There was no provision for credit losses recorded during the three months ended December 31, 2024.
- Total non-interest income was $3,398,000 for the three months ended December 31, 2025, which was $59,000 more than the comparable period last year. The primary driver of the increase was an increase in derivative income of $75,000.
- Total non-interest expenses for the three months ended December 31, 2025 totaled $16,173,000 compared to $16,668,000 for the same period last year, which is a decrease of $495,000, or 3.0%. Salary and employee benefits decreased due to a decrease in headcount of 11 FTEs, commission expense, profit sharing and vacation costs. The decrease in shares tax expense is due to timing and level of charitable contributions that are included in other expenses that generate tax credits utilized by Bank on its Pennsylvania shares tax return.
- The provision for income taxes increased $892,000 when comparing the three months ended December 31, 2025 to the same period in 2024. This increase was attributable to increase in income before provision for income taxes of $3,392,000. The effective tax rate was 19.0% and 16.4% for the three months ended December 31, 2025 and 2024, respectively.
Balance Sheet and Other Information:
- At December 31, 2025, total assets were $3.06 billion, compared to $3.03 billion at December 31, 2024. The loan to deposit ratio as of December 31, 2025 was 98.89% compared to 97.11% as of December 31, 2024.
- Available for sale securities of $444.7 million at December 31, 2025 increased $18.8 million from December 31, 2024. The yield on the investment portfolio increased from 2.44% to 3.06% on a tax equivalent basis due to securities purchased during a higher rate environment and lower yielding securities maturing. Investment activity for 2025 has focused on replacing securities as they mature with the exception of the purchase of $20.3 million of municipal securities in the third quarter of 2025.
- Net loans of $2.33 billion at December 31, 2025 increased of $36.3 million from December 31, 2024, primarily due to an increase in commercial loan activity offset by a decrease in student loans outstanding. The decrease construction loans of $74.9 million is the result of projects in our Delaware market and the southeast Pennsylvania market being completed and the related construction loans either transferring to other portfolios or being paid off.
- The allowance for credit losses - loans totaled $22,806,000 at December 31, 2025 which is an increase of $1,107,000 from December 31, 2024. The provision for credit losses in 2025 was based on the economic forecasts and changes in expected prepayment speeds, as well as specific reserves for loans placed on non-accrual status in the fourth quarter of 2025. The provision for credit losses on loans was $1,888,000 for 2025 compared to $3,176,000 for 2024. The provision for off-balance sheet items was $487,000 for 2025 compared to a credit of ($589,000) for 2024. Loan recoveries and charge-offs were $77,000 and $858,000, respectively, for 2025 compared to loan recoveries and charge-offs of $43,000 and $2,673,000, respectively for 2024. For the three months ended December 31, 2025, loan recoveries and charge-offs were $6,000 and $57,000, respectively. The allowance for credit losses as a percent of total loans was 0.97% as of December 31, 2025 and 0.94% as of December 31, 2024.
- Non-performing assets totaled $29.2 million as of December 31, 2025, an increase of $578,000 since December 31, 2024. The increase was driven by two large commercial relationships being placed on non-accrual status during the fourth quarter of 2025, which offset significant pay-offs of non-accrual loans that occurred in the first three quarters of 2025.
- Deposits decreased $5.0 million from December 31, 2024, to $2.40 billion at December 31, 2025. Competitive pressure for deposits remains high. Brokered CD's have decreased $33.1 million since December 31, 2024. Additionally, a school district in our southeastern Pennsylvania market saw a decrease in their balance of $58.9 million due to the lack of state budget for parts of 2025. At December 31, 2025, the Bank estimates that deposit balances held by customers in excess of the FDIC insurance limit ($250,000 per insured account) totaled $1.16 billion, or 47.3% of the Bank's total deposits. Included in this balance are balances held through Intrafi, which provides customers with additional FDIC insurance, as well as deposits collateralized by securities or letters of credit (almost exclusively municipal deposits). The total of these items was $647.7 million, or 27.2% of the Bank's total deposits, as of December 31, 2025.
- Borrowed funds totaled $309.4 million as of December 31, 2025, a $11.7 million increase from December 31, 2024, due to a decrease in deposits and increases in loans and investments in 2025.
- Stockholders' equity totaled $338.1 million at December, 2025, compared to $299.7 million at December 31, 2024, an increase of $38.3 million. Excluding accumulated other comprehensive loss (AOCL), stockholders' equity increased $27.2 million and totals $350.4 million (non-GAAP). The increase in stockholders' equity was attributable to net income for 2025 totaling $36.6 million, offset by cash dividends for 2025 totaling $9.5 million. As a result of decreases in market interest rates impacting the fair value of investment securities and swaps, stockholders' equity increased due to a decrease in AOCL of $11.1 million from December 31, 2024.
Dividend Declared
On December 2, 2025, the Board of Directors declared a cash dividend of $0.50 per share, which was paid on December 26, 2025 to shareholders of record at the close of business on December 12, 2025. This quarterly cash dividend is an increase of 3.1% over the quarterly cash dividend of $0.485 per share declared one year ago, as adjusted for the 1% stock dividend declared in June 2025.
Citizens Financial Services, Inc. has nearly 1,800 shareholders, the majority of whom reside in markets where its offices are located.
Note: This press release may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are not historical facts; rather, they are statements based on the Company's current expectations regarding its business strategies and their intended results and its future performance. Forward-looking statements are preceded by terms such as "expects," "believes," "anticipates," "intends" and similar expressions. Forward-looking statements are not guarantees of future performance. Numerous risks and uncertainties could cause or contribute to the Company's actual results, performance and achievements to be materially different from those expressed or implied by the forward-looking statements. Factors that may cause or contribute to these differences include, without limitation, changes in general economic conditions, including changes in market interest rates and changes in monetary and fiscal policies of the federal government; legislative and regulatory changes; and other factors disclosed periodically in the Company's filings with the Securities and Exchange Commission. Because of the risks and uncertainties inherent in forward-looking statements, readers are cautioned not to place undue reliance on them, whether included in this press release or made elsewhere periodically by the Company or on its behalf. The Company assumes no obligation to update any forward-looking statements except as may be required by applicable law or regulation.
(1) See reconciliation of GAAP and Non-GAAP measures at the end of the press release
CITIZENS FINANCIAL SERVICES, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(UNAUDITED)
(Dollars in thousands, except per share data)
As of or For The
As of or For The
Three Months Ended
Year Ended
December 31,
December 31,
2025 2024 2025 2024
Income and Performance Ratios
Net Income $10,483 $7,983 $36,572 $27,818
Return on average assets (annualized) 1.37 % 1.06 % 1.21 % 0.93 %
Return on average equity (annualized) 12.53 % 10.63 % 11.51 % 9.59 %
Return on average tangible equity (annualized) (a) 17.01 % 15.10 % 15.94 % 13.84 %
Net interest margin (tax equivalent) (a) 3.69 % 3.26 % 3.50 % 3.13 %
Earnings per share - basic (b) $2.19 $1.66 $7.62 $5.80
Earnings per share - diluted (b) $2.18 $1.66 $7.62 $5.79
Cash dividends paid per share (b) $0.500 $0.485 $1.980 $1.931
Number of shares used in computation - basic (b) 4,796,717 4,797,135 4,797,520 4,797,258
Number of shares used in computation - diluted (b) 4,798,194 4,799,578 4,800,093 4,802,139
Asset quality
Allowance for credit losses - loans $22,806 $21,699
Non-performing assets $29,189 $28,612
Allowance for credit losses - loans to total loans 0.97 % 0.94 %
Non-performing assets to total loans 1.24 % 1.24 %
Annualized net charge-offs to total loans 0.01 % 0.01 % 0.03 % 0.11 %
Equity
Book value per share (b) $70.32 $62.35
Tangible book value per share (a) (b) $52.02 $43.91
Market value per share (Last reported trade of month) $57.02 $63.31
Common shares outstanding 4,807,080 4,759,612
Other
Average Full Time Equivalent Employees 377.9 388.5 379.8 392.0
Loan to Deposit Ratio 98.89 % 97.11 %
Trust assets under management $194,841 $180,710
Brokerage assets under management $317,895 $395,869
Balance Sheet Highlights December 31, December 31,
2025 2024
Assets $3,064,564 $3,025,724
Investment securities 446,556 427,659
Loans (net of unearned income) 2,350,622 2,313,242
Allowance for credit losses - loans 22,806 21,699
Deposits 2,376,979 2,382,028
Stockholders' Equity 338,051 299,734
(a) See reconciliation of GAAP and Non-GAAP measures at the end of the press release:
(b) Prior period amounts were adjusted to reflect stock dividends.
CITIZENS FINANCIAL SERVICES, INC.
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
December 31, December 31,
(in thousands, except share data) 2025 2024
ASSETS:
Cash and due from banks:
Noninterest-bearing $23,933 $30,284
Interest-bearing 10,358 11,918
Total cash and cash equivalents 34,291 42,202
Interest bearing time deposits with other banks 3,820 3,820
Equity securities 1,815 1,747
Available-for-sale securities 444,741 425,912
Loans held for sale 9,393 9,607
Loans (net of allowance for credit losses - loans: $22,806 at December 31, 2025;
$21,699 at December 31, 2024) 2,327,816 2,291,543
Premises and equipment 20,998 21,395
Accrued interest receivable 10,698 10,307
Goodwill 85,758 85,758
Bank owned life insurance 51,501 50,341
Other intangibles 2,221 2,892
Fair value of derivative instruments - asset 6,927 10,370
Deferred tax asset 11,440 15,199
Other assets 53,145 54,631
TOTAL ASSETS $3,064,564 $3,025,724
LIABILITIES:
Deposits:
Noninterest-bearing $516,657 $532,776
Interest-bearing 1,860,322 1,849,252
Total deposits 2,376,979 2,382,028
Borrowed funds 309,448 297,721
Accrued interest payable 3,130 4,693
Fair value of derivative instruments - liability 4,100 5,817
Other liabilities 32,856 35,731
TOTAL LIABILITIES 2,726,513 2,725,990
STOCKHOLDERS' EQUITY:
Preferred Stock $1.00 par value; authorized
3,000,000 shares; none issued in 2025 or 2024
Common stock
$1.00 par value; authorized 25,000,000 shares at December 31, 2025, and 2024:
issued 5,255,807 shares at December 31, 2025 and 5,207,577 shares at December 31, 2024 5,256 5,208
Additional paid-in capital 147,965 144,984
Retained earnings 213,623 189,443
Accumulated other comprehensive loss (12,377) (23,521)
Treasury stock, at cost: 448,727 shares at December 31, 2025 and 447,965 shares
at December 31, 2024 (16,416) (16,380)
TOTAL STOCKHOLDERS' EQUITY 338,051 299,734
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $3,064,564 $3,025,724
CITIZENS FINANCIAL SERVICES, INC.
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
Three Months Ended Year Ended
December 31, December 31,
(in thousands, except share and per share data) 2025 2024 2025 2024
INTEREST INCOME:
Interest and fees on loans $37,229 $36,630 $144,430 $142,688
Interest-bearing deposits with banks 108 156 502 851
Investment securities:
Taxable 2,579 2,112 9,910 7,135
Nontaxable 811 524 2,626 2,093
Dividends 424 371 1,700 1,550
TOTAL INTEREST INCOME 41,151 39,793 159,168 154,317
INTEREST EXPENSE:
Deposits 11,806 13,875 47,050 52,326
Borrowed funds 3,134 3,045 14,117 15,536
TOTAL INTEREST EXPENSE 14,940 16,920 61,167 67,862
NET INTEREST INCOME 26,211 22,873 98,001 86,455
Provision for credit losses 500 2,375 2,587
NET INTEREST INCOME AFTER
PROVISION (RELEASE) FOR CREDIT LOSSES 25,711 22,873 95,626 83,868
NON-INTEREST INCOME:
Service charges 1,377 1,356 5,569 5,749
Trust 199 187 792 816
Brokerage and insurance 556 608 2,627 2,381
Gains on loans sold 570 596 2,290 2,316
Equity security gains, net 11 18 67 145
Earnings on bank owned life insurance 369 350 1,433 1,684
Gain on sale of Braavo division 1,102
Other 316 224 1,566 1,208
TOTAL NON-INTEREST INCOME 3,398 3,339 14,344 15,401
NON-INTEREST EXPENSES:
Salaries and employee benefits 9,213 9,725 39,402 39,347
Occupancy 1,441 1,208 5,299 5,013
Furniture and equipment 353 247 1,209 1,038
Professional fees 806 578 2,341 2,599
FDIC insurance expense 370 407 1,710 1,996
Pennsylvania shares tax (315) 248 739 1,114
Amortization of intangibles 111 132 478 564
Software expenses 502 445 1,844 1,953
Other real estate owned expenses (recovery) 69 (34) 267 212
Other 3,623 3,712 11,593 11,750
TOTAL NON-INTEREST EXPENSES 16,173 16,668 64,882 65,586
Income before provision for income taxes 12,936 9,544 45,088 33,683
Provision for income tax expense 2,453 1,561 8,516 5,865
NET INCOME $10,483 $7,983 $36,572 $27,818
PER COMMON SHARE DATA:
Net Income - Basic $2.19 $1.66 $7.62 $5.80
Net Income - Diluted $2.18 $1.66 $7.62 $5.79
Cash Dividends Paid $0.500 $0.485 $1.980 $1.931
Number of shares used in computation - basic 4,796,717 4,797,135 4,797,520 4,797,258
Number of shares used in computation - diluted 4,798,194 4,799,578 4,800,093 4,802,139
CITIZENS FINANCIAL SERVICES, INC.
QUARTERLY CONDENSED, CONSOLIDATED INCOME STATEMENT INFORMATION
(UNAUDITED)
(in thousands, except per share data)
Three Months Ended,
Dec 31, Sept 30, June 30, March 31, Dec 31,
2025 2025 2025 2025 2024
Interest income $41,151 $40,254 $38,749 $39,014 $39,793
Interest expense 14,940 15,114 15,101 16,012 16,920
Net interest income 26,211 25,140 23,648 23,002 22,873
Provision (release) for credit losses 500 500 750 625
Net interest income after provision (release) for credit losses 25,711 24,640 22,898 22,377 22,873
Non-interest income 3,387 3,820 3,632 3,438 3,321
Investment securities gains (losses), net 11 34 33 (11) 18
Non-interest expenses 16,173 16,134 16,147 16,428 16,668
Income before provision for income taxes 12,936 12,360 10,416 9,376 9,544
Provision for income tax expense 2,453 2,355 1,953 1,755 1,561
Net income $10,483 $10,005 $8,463 $7,621 $7,983
Earnings Per Share - Basic $2.19 $2.09 $1.76 $1.59 $1.66
Earnings Per Share - Diluted $2.18 $2.09 $1.76 $1.59 $1.66
CITIZENS FINANCIAL SERVICES, INC.
CONSOLIDATED AVERAGE BALANCES, INTEREST, YIELDS AND RATES, AND NET INTEREST MARGIN ON A FULLY TAX-EQUIVALENT BASIS
(UNAUDITED)
Three Months Ended December 31,
2025 2024
Average Average Average Average
Balance (1) Interest Rate Balance
(1) Interest Rate
(dollars in thousands)
$
$ %
$
$ %
ASSETS
Interest-bearing deposits at banks 16,686 78 1.85 17,680 126 2.84
Interest bearing time deposits at banks 3,820 30 3.12 3,820 30 3.12
Investment securities:
Taxable 368,851 3,003 3.26 368,221 2,483 2.70
Tax-exempt (3) 119,951 1,027 3.42 103,375 664 2.57
Investment securities 488,802 4,030 3.30 471,596 3,147 2.67
Loans: (2)(3)(4)
Residential mortgage loans 345,134 5,303 6.10 355,108 5,146 5.77
Construction loans 95,607 1,734 7.20 173,427 3,276 7.51
Commercial Loans 1,377,802 21,714 6.25 1,270,978 20,173 6.31
Agricultural Loans 373,964 6,279 6.66 355,557 5,275 5.90
Loans to state & political subdivisions 51,915 522 3.99 55,333 555 3.99
Other loans 99,512 1,779 7.09 116,703 2,313 7.89
Loans, net of discount (2)(3)(4) 2,343,934 37,331 6.32 2,327,106 36,738 6.28
Total interest-earning assets 2,853,242 41,469 5.77 2,820,202 40,041 5.65
Cash and due from banks 9,709 9,088
Bank premises and equipment 21,454 21,291
Other assets 184,931 186,815
Total non-interest earning assets 216,094 217,194
Total assets 3,069,336 3,037,396
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing liabilities:
Business Interest Checking 23,910 47 0.78 16,820 40 0.95
NOW accounts 723,840 3,863 2.12 742,784 4,608 2.47
Savings accounts 283,289 333 0.47 289,798 367 0.50
Money market accounts 487,732 3,455 2.81 422,624 3,351 3.15
Certificates of deposit 460,552 4,108 3.54 544,320 5,509 4.03
Total interest-bearing deposits 1,979,323 11,806 2.37 2,016,346 13,875 2.74
Other borrowed funds 307,378 3,134 4.05 273,604 3,045 4.43
Total interest-bearing liabilities 2,286,701 14,940 2.59 2,289,950 16,920 2.94
Demand deposits 394,474 395,714
Other liabilities 40,223 29,545
Total non-interest-bearing liabilities 434,697 425,259
Stockholders' equity 347,938 322,187
Total liabilities & stockholders' equity 3,069,336 3,037,396
Net interest income 26,529 23,121
Net interest spread (5) 3.18 % 2.71 %
Net interest income as a percentage
of average interest-earning assets 3.69 % 3.26 %
Ratio of interest-earning assets
to interest-bearing liabilities 125 % 123 %
(1) Averages are based on daily averages.
(2) Includes loan origination and commitment fees.
(3) Tax exempt interest revenue is shown on a tax equivalent basis for proper comparison using
a statutory federal income tax rate of 21% for 2025 and 2024. See reconciliation of GAAP and non-gaap measures at the end
of the press release
(4) Income on non-accrual loans is accounted for on a cash basis, and the loan balances are included in interest-earning assets.
(5) Interest rate spread represents the difference between the average rate earned on interest-earning assets
and the average rate paid on interest-bearing liabilities.
CITIZENS FINANCIAL SERVICES, INC.
CONSOLIDATED AVERAGE BALANCES, INTEREST, YIELDS AND RATES, AND NET INTEREST MARGIN ON A FULLY TAX-EQUIVALENT BASIS
(UNAUDITED)
Year Ended December 31,
2025 2024
Average Average Average Average
Balance (1) Interest Rate Balance
(1) Interest Rate
(dollars in thousands)
$
$ %
$
$ %
ASSETS
Interest-bearing deposits at banks 23,767 384 1.62 28,264 730 2.58
Interest bearing time deposits at banks 3,820 118 3.09 3,878 121 3.09
Investment securities:
Taxable 378,387 11,610 3.07 359,724 8,685 2.41
Tax-exempt (3) 109,125 3,324 3.05 105,141 2,650 2.52
Investment securities 487,512 14,934 3.06 464,865 11,335 2.44
Loans: (2)(3)(4)
Residential mortgage loans 346,313 20,841 6.02 356,292 20,758 5.83
Construction loans 135,920 9,744 7.17 182,714 13,607 7.45
Commercial Loans 1,320,836 84,059 6.36 1,265,922 80,849 6.39
Agricultural Loans 362,880 21,227 5.85 350,588 18,978 5.41
Loans to state & political subdivisions 52,730 2,071 3.93 55,919 2,213 3.96
Other loans 96,097 6,898 7.18 83,916 6,717 8.00
Loans, net of discount (2)(3)(4) 2,314,776 144,840 6.26 2,295,351 143,122 6.24
Total interest-earning assets 2,829,875 160,276 5.66 2,792,358 155,308 5.56
Cash and due from banks 9,727 9,306
Bank premises and equipment 21,638 21,124
Other assets 180,011 183,674
Total non-interest earning assets 211,376 214,104
Total assets 3,041,251 3,006,462
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing liabilities:
Business Interest Checking 20,148 179 0.89 8,756 88 1.01
NOW accounts 718,185 15,361 2.14 756,689 19,117 2.53
Savings accounts 287,162 1,336 0.47 296,275 1,532 0.52
Money market accounts 453,545 12,919 2.85 397,942 12,482 3.14
Certificates of deposit 470,285 17,255 3.67 481,862 19,107 3.97
Total interest-bearing deposits 1,949,325 47,050 2.41 1,941,524 52,326 2.70
Other borrowed funds 326,026 14,117 4.33 323,409 15,536 4.80
Total interest-bearing liabilities 2,275,351 61,167 2.69 2,264,933 67,862 3.00
Demand deposits 387,914 385,702
Other liabilities 40,650 40,593
Total non-interest-bearing liabilities 428,564 426,295
Stockholders' equity 337,336 315,234
Total liabilities & stockholders' equity 3,041,251 3,006,462
Net interest income 99,109 87,446
Net interest spread (5) 2.97 % 2.56 %
Net interest income as a percentage
of average interest-earning assets 3.50 % 3.13 %
Ratio of interest-earning assets
to interest-bearing liabilities 124 % 123 %
(1) Averages are based on daily averages.
(2) Includes loan origination and commitment fees.
(3) Tax exempt interest revenue is shown on a tax equivalent basis for proper comparison using
a statutory federal income tax rate of 21% for 2025 and 2024. See reconciliation of GAAP and non-gaap measures at the end
of the press release
(4) Income on non-accrual loans is accounted for on a cash basis, and the loan balances are included in interest-earning assets.
(5) Interest rate spread represents the difference between the average rate earned on interest-earning assets
and the average rate paid on interest-bearing liabilities.
CITIZENS FINANCIAL SERVICES, INC.
CONSOLIDATED SUMMARY OF LOANS BY TYPE; NON-PERFORMING ASSETS; AND ALLOWANCE FOR CREDIT LOSSES
(UNAUDITED)
(Excludes Loans Held for Sale)
(In Thousands)
December 31, September 30, June 30, March 31, December 31,
2025 2025 2025 2025 2024
Real estate:
Residential $340,972 $344,790 $341,671 $350,221 $351,398
Commercial 1,218,514 1,180,655 1,151,585 1,117,240 1,121,435
Agricultural 347,448 342,487 331,995 329,985 327,722
Construction 93,965 107,867 138,307 168,896 164,326
Consumer 88,210 109,458 22,364 109,339 109,505
Other commercial loans 179,166 171,345 174,740 158,133 155,012
Other agricultural loans 30,247 27,142 28,366 28,488 29,662
State & political subdivision loans 52,100 51,644 52,727 53,361 54,182
Total loans 2,350,622 2,335,388 2,241,755 2,315,663 2,313,242
Less: allowance for credit losses - loans 22,806 22,454 22,109 22,081 21,699
Net loans $2,327,816 $2,312,934 $2,219,646 $2,293,582 $2,291,543
Past due and non-performing assets
Total loans past due 30-89 days and still accruing $9,269 $13,228 $18,554 $9,632 $8,015
Non-accrual loans $26,602 $20,523 $24,595 $23,545 $25,701
Loans past due 90 days or more and still accruing 229 37 347 1,393 276
Non-performing loans $26,831 $20,560 $24,942 $24,938 $25,977
Other real estate owned 2,358 2,434 2,434 2,544 2,635
Total Non-performing assets $29,189 $22,994 $27,376 $27,482 $28,612
Three Months Ended
Analysis of the Allowance for Credit Losses - Loans December 31, September 30, June 30, March 31, December 31,
(In Thousands) 2025 2025 2025 2025 2024
Balance, beginning of period $22,454 $22,109 $22,081 $21,699 $21,695
Charge-offs (57) (20) (596) (185) (105)
Recoveries 6 17 25 29 19
Net charge-offs (51) (3) (571) (156) (86)
Provision for credit losses - loans 403 348 599 538 90
Balance, end of period $22,806 $22,454 $22,109 $22,081 $21,699
CITIZENS FINANCIAL SERVICES, INC.
Reconciliation of GAAP and Non-GAAP Financial Measures
(UNAUDITED)
(Dollars in thousands, except per share data)
As of
December 31,
2025 2024
Tangible Equity
Stockholders' Equity - GAAP $338,051 $299,734
Intangible Assets (87,979) (88,650)
Tangible Equity - Non-GAAP 250,072 211,084
Shares outstanding adjusted for June 2025 stock Dividend 4,807,080 4,806,685
Tangible Book value per share - Non-GAAP $52.02 $43.91
As of
December 31,
2025 2024
Tangible Equity per share
Stockholders' Equity per share - GAAP $70.32 $62.35
Adjustment for intangible assets (18.30) (18.44)
Tangible Book value per share - Non-GAAP $52.02 $43.91
For the Three Months Ended
For the Year Ended
December 31,
December 31,
2025 2024 2025 2024
Return on Average Assets Excluding Accumulated Other Comprehensive Loss (AOCL)
Average Assets - GAAP $3,055,993 $3,015,467 $3,021,591 $2,981,322
Average AOCL (13,343) (21,929) (19,660) (25,140)
Average Assets, Excluding AOCL - Non-GAAP 3,069,336 3,037,396 3,041,251 3,006,462
Net Income - GAAP $10,483 $7,983 $36,572 $27,818
Annualized Return on Average Assets-GAAP 1.37 % 1.06 % 1.21 % 0.93 %
Annualized Return on Average Assets, Excluding AOCL - Non-GAAP 1.37 % 1.05 % 1.20 % 0.93 %
For the Three Months Ended
For the Year Ended
December 31,
December 31,
2025 2024 2025 2024
Return on Average Equity Excluding Accumulated Other Comprehensive Loss (AOCL)
Average Stockholders' Equity - GAAP $334,595 $300,258 $317,676 $290,094
Average AOCL (13,343) (21,929) (19,660) (25,140)
Average Stockholders' Equity, Excluding AOCL - Non-GAAP 347,938 322,187 337,336 315,234
Net Income - GAAP $10,483 $7,983 $36,572 $27,818
Annualized Return on Average Stockholders' Equity-GAAP 12.53 % 10.63 % 11.51 % 9.59 %
Annualized Return on Average Stockholders' Equity, Excluding AOCL - Non-GAAP 12.05 % 9.91 % 10.84 % 8.82 %
For the Three Months Ended
For the Year Ended
December 31,
December 31,
2025 2024 2025 2024
Return on Average Tangible Equity
Average Stockholders' Equity - GAAP $334,595 $300,258 $317,676 $290,094
Average Intangible Assets (88,062) (88,757) (88,308) (89,031)
Average Tangible Equity - Non-GAAP 246,533 211,501 229,368 201,063
Net Income - GAAP $10,483 $7,983 $36,572 $27,818
Annualized Return on Average Tangible Equity Non-GAAP 17.01 % 15.10 % 15.94 % 13.84 %
For the Three Months Ended
For the Year Ended
December 31,
December 31,
2025 2024 2025 2024
Return on Average Assets and Equity Excluding sale of Braavo assets, net of legal fees and provision associated with Braavo loans remaining after sale
Net Income - GAAP $10,483 $7,983 $36,572 $27,818
After tax gain on sale of Braavo, net of legal fees (712)
After tax provision associated with Braavo loans remaining after sale 1,427
Net Income excluding sale of Braavo assets, net of legal fees and provision associated with Braavo loans remaining after sale - Non-GAAP $10,483 $7,983 $36,572 $28,533
Average Assets 3,055,993 3,015,467 3,021,591 2,981,322
Annualized Return on Average assets, Excluding sale of Braavo assets, net of legal fees, provision associated with Braavo loans remaining after sale, net of tax - Non-GAAP 1.37 % 1.06 % 1.21 % 0.96 %
Average Stockholders' Equity - GAAP $334,595 $300,258 $317,676 $290,094
Annualized Return on Average Stockholders' equity, Excluding sale of Braavo assets, net of legal fees, provision associated with Braavo loans remaining after sale, net of tax - Non-GAAP 12.53 % 10.63 % 11.51 % 9.84 %
Average Tangible Equity - Non-GAAP 246,533 211,501 229,368 201,063
Annualized Return on Average Tangible Equity Excluding sale of Braavo assets, net of legal fees, provision associated with Braavo loans remaining after sale, net of tax, - Non-GAAP 17.01 % 15.10 % 15.94 % 14.19 %
For the Three Months Ended
For the Year Ended
December 31,
December 31,
2025 2024 2025 2024
Earnings per share, Excluding sale of Braavo assets, net of legal fees and provision associated with Braavo loans remaining after sale
Net Income - GAAP $10,483 $7,983 $36,572 $27,818
After tax gain on sale of Braavo, net of legal fees (712)
After tax provision associated with Braavo loans remaining after sale 1,427
Net income excluding one time items - Non-GAAP $10,483 $7,983 $36,572 $28,533
Number of shares used in computation - basic 4,796,717 4,797,135 4,797,520 4,797,258
Basic and Diluted earnings per share, Excluding sale of Braavo assets, net of legal fees, provision associated with Braavo loans remaining after sale, net of tax - Non-GAAP $2.19 $1.66 $7.62 $5.95
For the Three Months Ended
For the Year Ended
December 31,
December 31,
Reconciliation of net interest income on fully taxable equivalent basis 2025 2024 2025 2024
Total interest income $41,151 $39,793 $159,168 $154,317
Total interest expense 14,940 16,920 61,167 67,862
Net interest income 26,211 22,873 98,001 86,455
Tax equivalent adjustment 318 248 1,108 991
Net interest income (fully taxable equivalent) - Non-GAAP $26,529 $23,121 $99,109 $87,446
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SOURCE Citizens Financial Services, Inc.
