EX-99.1

Exhibit 99.1

January 30, 2019

Press Release

Source:

Farmers National Banc Corp.

Kevin J. Helmick, President and CEO

20 South Broad Street, P.O. Box 555

Canfield, OH 44406

330.533.3341

Email: exec@farmersbankgroup.com

FARMERS NATIONAL BANC CORP. ANNOUNCES

2018 FOURTH QUARTER FINANCIAL RESULTS

•

Record net income for 2018 of $32.6 million, 43.4% higher than 2017

•

Record net income for the quarter of $8.7 million, 7.5% higher than most recent quarter

•

144 consecutive quarters of profitability

•

Annualized return on average assets was 1.50% and annualized return on average equity 13.65% for the quarter ended December 31, 2018

•

10% loan growth since December 31, 2017

•

Non-performing assets to total assets remain at low levels, 0.33% at December 31, 2018

CANFIELD, Ohio (January 30, 2019) – Farmers National Banc Corp. (Farmers) (NASDAQ: FMNB) today reported financial results for the three months and year ended December 31, 2018.

Net income for the three months ended December 31, 2018 was $8.7 million, or $0.31 per diluted share, which compares to $5.2 million, or $0.19 per diluted share, for the three months ended December 31, 2017 and $8.1 million, or $0.29 per diluted share, for the linked quarter. Annualized return on average assets and return on average equity were 1.50% and 13.65%, respectively, for the three month period ending December 31, 2018, compared to 0.96% and 8.60% for the same three month period in 2017, and 1.42% and 12.80% for the linked quarter. Farmers’ return on average tangible equity (Non-GAAP) was 16.68% for the quarter ended December 31, 2018 compared to 10.69% for the same quarter in 2017 and 15.70% for the linked quarter.

Net income for the twelve months ended December 31, 2018 was $32.6 million, or $1.16 per diluted share, compared to $22.7 million or $0.82 per diluted share for the same twelve month period in 2017. Return on average assets and return on average equity were 1.46% and 13.13%, respectively, for the twelve months ended December 31, 2018, compared to 1.09% and 9.92% for the same period in 2017. Farmers’ return on average tangible equity (Non-GAAP) was 16.02% for the twelve month period ended December 31, 2018 compared to 12.36% for the same period in 2017.

On December 22, 2017, H.R.1, known as the “Tax Cuts and Jobs Act,” was signed into law. H.R.1, among other things, reduced the corporate income tax rate to 21% effective January 1, 2018. As a result of passage of the new tax law, Farmers effective tax rate decreased from 31.5% for the twelve months ended December 31, 2017 to 14.9% for the twelve months ended December 31, 2018. With the enactment of the new tax law, Farmers was required to remeasure its net deferred tax asset to the current enacted statutory tax rate. The remeasurement of the net deferred tax asset in the fourth quarter of 2017 reduced the net deferred tax asset and increased federal income tax expense by approximately $1.8 million. This represented an impact on earnings per share of approximately $0.06 per diluted share for that fourth quarter, based on that quarter’s weighted average diluted shares outstanding of approximately 28 million.

Kevin J. Helmick, President and CEO, stated, “We are pleased to report record net income for the quarter and for all of 2018. This is a result of the successful execution of our strategic plan, including the integration of several acquisitions over the previous 3 years. Our performance was a result of many positive factors, including continued strong loan growth and strong growth in non-interest income, low levels of credit costs and well controlled non-interest expenses.”

2018 Fourth Quarter Financial Highlights

•

Loan growth

Total loans were $1.74 billion at December 31, 2018, compared to $1.58 billion at December 31, 2017, representing an increase of 10.1%. The increase in loans is a direct result of Farmers’ focus on loan growth utilizing a talented lending and credit team, while adhering to a sound underwriting discipline. The increase in loans has occurred in the commercial and commercial real estate, residential real estate and agricultural loan portfolios. Loans now comprise 79.4% of the Bank’s average earning assets for the quarter ended December 31, 2018, an improvement compared to 77.9% for the same period in 2017. This improvement, along with the interest rate environment, has resulted in a 16.4% increase in loan income in the fourth quarter of 2018 compared to the same quarter in 2017.

•

Loan quality

Non-performing assets to total assets remain at a low level, currently at 0.33%. Early stage delinquencies also continue to remain at low levels, at $8.9 million, or 0.51% of total loans, at December 31, 2018. Net charge-offs for the current quarter were $310 thousand, compared to $189 thousand in the same quarter in 2017 and annualized net charge-offs as a percentage of average net loans outstanding is only 0.07% for the quarter ended December 31, 2018. Lending to the energy sector is insignificant and less than 1% of the loan portfolio.

•

Net interest margin

The net interest margin for the three months ended December 31, 2018 was 3.80%, an 18 basis points decrease from the quarter ended December 31, 2017. In comparing the fourth quarter of 2018 to the same period in 2017, asset yields increased 22 basis points, while the cost of interest-bearing liabilities increased 54 basis points. Most of this increase was the result of higher rates paid on short-term borrowings, interest-bearing demand deposits and time deposits, which is consistent with increases in the federal funds sold rate. The net interest margin is impacted by the additional accretion as a result of the discounted loan portfolios acquired in the previous mergers, which increased the net interest margin by 5 and 3 basis points for the quarters ended December 31, 2018 and 2017, respectively.

•

Noninterest income

Noninterest income increased 10.8% to $6.7 million for the quarter ended December 31, 2018 compared to $6.1 million in the same quarter of 2017. Trust fees increased $130 thousand or 8% in comparing the fourth quarter of 2018 to the same quarter in 2017. In the fourth quarter of 2018 security gains increased $255 thousand, other operating income increased $170 thousand or 76% and insurance agency commissions increased $112 thousand or 21% from the fourth quarter in 2017. These increases were offset by a drop in retirement plan consulting fees of $95 thousand or 20%.

•

Noninterest expenses

Farmers has remained committed to managing its level of noninterest expenses. Total noninterest expenses for the fourth quarter of 2018 increased 6.4% to $16.0 million compared to $15.0 million in the same quarter in 2017, primarily a result of increases in salaries and employee benefits of $747 thousand (which included a $390 thousand increase in salaries and a $381 thousand increase in health insurance expense due to higher claims in the fourth quarter), and a $373 thousand increase in other operation expenses. These increased expenses were offset by a $268 thousand decrease in merger related costs as a result of a $180 thousand reduction to the earnout liability associated with a prior acquisition. It is important to note that annualized noninterest expenses measured as a percentage of quarterly average assets remained low at 2.79% and 2.78% in the fourth quarters of 2018 and 2017, respectively.

•

Efficiency ratio

The efficiency ratio for the quarter ended December 31, 2018 improved to 57.73% compared to 58.40% for the same quarter in 2017. The main factors leading to this improvement were the increase in net interest income and noninterest income and a lower level of noninterest expenses relative to average assets as explained in the preceding paragraphs.

2019 Outlook

Mr. Helmick added, “We will look to enhance our wealth management and digital offerings as we anticipate maintaining the momentum from our diversified businesses to sustain strong performance in 2019.”

Founded in 1887, Farmers National Banc Corp. is a diversified financial services company headquartered in Canfield, Ohio, with $2.3 billion in banking assets. Farmers National Banc Corp.’s wholly-owned subsidiaries are comprised of The Farmers National Bank of Canfield, a full-service national bank engaged in commercial and retail banking with 41 banking locations in Mahoning, Trumbull, Columbiana, Stark, Wayne, Medina and Cuyahoga Counties in Ohio and Beaver County in Pennsylvania, Farmers Trust Company, which operates four trust offices and offers services in the same geographic markets, and National Associates, Inc. Total wealth management assets under care at December 31, 2018 are $2.6 billion. Farmers National Insurance, LLC and Bowers Insurance Agency, Inc., wholly-owned subsidiaries of The Farmers National Bank of Canfield, offer a variety of insurance products.

Non-GAAP Disclosure

This press release includes disclosures of Farmers’ tangible common equity ratio, return on average tangible assets, return on average tangible equity and net income excluding costs related to acquisition activities, which are financial measures not prepared in accordance with generally accepted accounting principles in the United States (GAAP). A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed by GAAP. Farmers believes that these non-GAAP financial measures provide both management and investors a more complete understanding of the underlying operational results and trends and Farmers’ marketplace performance. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the numbers prepared in accordance with GAAP. The reconciliations of non-GAAP financial measures are included in the tables following Consolidated Financial Highlights below.

Forward-Looking Statements

This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about Farmers’ financial condition, results of operations, asset quality trends and profitability. Forward-looking statements are not historical facts but instead represent only management’s current expectations and forecasts regarding future events, many of which, by their nature, are inherently uncertain and outside of Farmers’ control. Forward-looking statements are preceded by terms such as “expects,” “believes,” “anticipates,” “intends” and similar expressions, as well as any statements related to future expectations of performance or conditional verbs, such as “will,” “would,” “should,” “could” or “may.” Farmers’ actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. Factors that could cause Farmers’ actual results to differ materially from those described in the forward-looking statements can be found in Farmers’ Annual Report on Form 10-K for the year ended December 31, 2017, which has been filed with the Securities and Exchange Commission (SEC) and is available on Farmers’ website (www.farmersbankgroup.com) and on the SEC’s website (www.sec.gov). Forward-looking statements are not guarantees of future performance and should not be relied upon as representing management’s views as of any subsequent date. Farmers does not undertake any obligation to update the forward-looking statements to reflect the impact of circumstances or events that may arise after the date of the forward-looking statements.

Farmers National Banc Corp. and Subsidiaries

Consolidated Financial Highlights

(Amounts in thousands, except per share results) Unaudited


Consolidated Statements of Income	For the Three Months Ended											For the Twelve Months Ended
	Dec. 31,			Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,			Dec. 31,		Percent
	2018			2018		2018		2018		2017		2018			2017		Change
Total interest income	$	24,447		$	23,563	$	22,474	$	21,282	$	21,084	$	91,766		$	80,527		14.0%
Total interest expense		4,373			3,644		2,912		2,336		2,017		13,265			6,881		92.8%

Net interest income		20,074			19,919		19,562		18,946		19,067		78,501			73,646		6.6%
Provision for loan losses		525			950		750		775		400		3,000			3,350		-10.4%
Noninterest income		6,705			6,478		6,306		6,010		6,051		25,499			24,051		6.0%
Acquisition related costs		(180	)		0		0		25		88		(155	)		888		-117.5%
Other expense		16,163			16,180		15,458		15,071		15,216		62,872			60,298		3.6%

Income before income taxes		10,271			9,267		9,660		9,085		9,414		38,283			33,161		16.8%
Income taxes		1,585			1,183		1,587		1,359		4,179		5,714			10,450		-43.3%

Net income	$	8,686		$	8,084	$	8,073	$	7,726	$	5,235	$	32,569		$	22,711		43.4%


Average basic shares outstanding	27,781	27,695	27,641	27,918	27,941	27,675	27,568
Basic earnings per share	0.31	0.29	0.29	0.28	0.19	1.18	0.82
Diluted earnings per share	0.31	0.29	0.29	0.28	0.19	1.16	0.82
Cash dividends	2,223	2,222	1,935	1,935	1,653	8,315	6,012
Cash dividends per share	0.08	0.08	0.07	0.07	0.06	0.30	0.22
Performance Ratios
Net Interest Margin (Annualized)	3.80%	3.86%	3.93%	3.92%	3.98%	3.87%	3.99%
Efficiency Ratio (Tax equivalent basis)	57.73%	58.70%	57.31%	57.98%	58.40%	57.93%	59.20%
Return on Average Assets (Annualized)	1.50%	1.42%	1.47%	1.45%	0.96%	1.46%	1.09%
Return on Average Equity (Annualized)	13.65%	12.80%	13.28%	13.03%	8.60%	13.13%	9.92%
Dividends to Net Income	25.59%	27.49%	23.97%	25.05%	31.58%	25.53%	26.47%
Other Performance Ratios (Non-GAAP)
Return on Average Tangible Assets	1.54%	1.46%	1.50%	1.46%	0.99%	1.49%	1.11%
Return on Average Tangible Equity	16.68%	15.70%	16.24%	15.84%	10.69%	16.02%	12.36%
Return on Average Tangible Equity excluding acquisition costs and deferred tax asset adjustments	16.34%	15.70%	16.24%	15.88%	14.25%	15.95%	13.48%

Consolidated Statements of Financial Condition


	Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,
	2018		2018		2018		2018		2017
Assets
Cash and cash equivalents	$	57,926	$	75,635	$	76,623	$	52,149	$	57,614
Securities available for sale		402,190		389,996		388,890		384,396		392,937
Equity securities		7,130		6,892		6,344		6,009		5,579
Loans held for sale		1,237		1,428		1,987		399		272
Loans		1,735,840		1,691,532		1,639,191		1,599,339		1,577,381
Less allowance for loan losses		13,592		13,377		12,764		12,550		12,315

Net Loans		1,722,248		1,678,155		1,626,427		1,586,789		1,565,066

Other assets		137,999		140,572		137,668		137,775		137,601

Total Assets	$	2,328,730	$	2,292,678	$	2,237,939	$	2,167,517	$	2,159,069


Liabilities and Stockholders’ Equity
Deposits
Noninterest-bearing	$	421,950	$	426,689	$	420,991	$	402,499	$	412,346
Interest-bearing		1,377,770		1,332,022		1,229,346		1,234,660		1,192,373

Total deposits		1,799,720		1,758,711		1,650,337		1,637,159		1,604,719
Other interest-bearing liabilities		250,792		270,273		322,565		274,816		296,559
Other liabilities		15,898		14,905		17,527		14,302		15,717

Total liabilities		2,066,410		2,043,889		1,990,429		1,926,277		1,916,995
Stockholders’ Equity		262,320		248,789		247,510		241,240		242,074

Total Liabilities and Stockholders’ Equity	$	2,328,730	$	2,292,678	$	2,237,939	$	2,167,517	$	2,159,069

Period-end shares outstanding		27,792		27,777		27,641		27,641		27,544
Book value per share	$	9.44	$	8.96	$	8.95	$	8.73	$	8.79
Tangible book value per share (Non-GAAP)*		7.86		7.36		7.34		7.10		7.14

*	Tangible book value per share is calculated by dividing tangible common equity by average outstanding shares


Capital and Liquidity
Common Equity Tier 1 Capital Ratio (a)		12.18%		12.13%		12.11%		12.06%		11.86%
Total Risk Based Capital Ratio (a)		12.91%		13.00%		12.97%		12.94%		12.73%
Tier 1 Risk Based Capital Ratio (a)		12.18%		12.26%		12.24%		12.19%		11.99%
Tier 1 Leverage Ratio (a)		9.84%		9.87%		9.81%		9.68%		9.50%
Equity to Asset Ratio		11.26%		10.85%		11.06%		11.13%		11.21%
Tangible Common Equity Ratio		9.56%		9.09%		9.25%		9.24%		9.31%
Net Loans to Assets		73.96%		73.20%		72.68%		73.21%		72.49%
Loans to Deposits		96.45%		96.18%		99.32%		97.69%		98.30%
Asset Quality
Non-performing loans	$	7,731	$	9,222	$	8,406	$	7,893	$	7,695
Other Real Estate Owned		0		0		0		59		171
Non-performing assets		7,731		9,222		8,406		7,952		7,866
Loans 30 - 89 days delinquent		8,877		10,626		10,636		6,973		10,191
Charged-off loans		753		544		777		782		809
Recoveries		443		207		241		242		620
Net Charge-offs		310		337		536		540		189
Annualized Net Charge-offs to Average Net Loans Outstanding		0.07%		0.08%		0.13%		0.14%		0.05%
Allowance for Loan Losses to Total Loans		0.78%		0.79%		0.78%		0.78%		0.78%
Non-performing Loans to Total Loans		0.45%		0.55%		0.51%		0.49%		0.49%
Allowance to Non-performing Loans		175.81%		145.06%		151.84%		159.00%		160.04%
Non-performing Assets to Total Assets		0.33%		0.40%		0.38%		0.37%		0.36%

(a)	December 31, 2018 ratio is estimated

Reconciliation of Total Assets to Tangible Assets


											For the Twelve Months Ended
	Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,		Dec. 31,
	2018		2018		2018		2018		2017		2018		2017
Total Assets	$	2,328,730	$	2,292,678	$	2,237,939	$	2,167,517	$	2,159,069	$	2,328,730	$	2,159,069
Less Goodwill and other intangibles		43,952		44,305		44,661		45,015		45,369		43,952		45,369

Tangible Assets	$	2,284,778	$	2,248,373	$	2,193,278	$	2,122,502	$	2,113,700	$	2,284,778	$	2,113,700

Average Assets		2,301,847		2,255,049		2,199,960		2,162,706		2,158,895		2,230,380		2,082,447
Less average Goodwill and other intangibles		44,185		44,541		44,893		45,248		45,622		44,712		45,146

Average Tangible Assets	$	2,257,662	$	2,210,508	$	2,155,067	$	2,117,458	$	2,113,273	$	2,185,668	$	2,037,301

Reconciliation of Common Stockholders’ Equity to Tangible Common Equity


											For the Twelve Months Ended
	Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,		Dec. 31,
	2018		2018		2018		2018		2017		2018		2017
Stockholders’ Equity	$	262,320	$	248,789	$	247,510	$	241,240	$	242,074	$	262,320	$	242,074
Less Goodwill and other intangibles		43,952		44,305		44,661		45,015		45,369		43,952		45,369

Tangible Common Equity	$	218,368	$	204,484	$	202,849	$	196,225	$	196,705	$	218,368	$	196,705

Average Stockholders’ Equity		252,449		250,503		243,792		240,387		241,554		247,965		228,963
Less average Goodwill and other intangibles		44,185		44,541		44,893		45,248		45,622		44,712		45,146

Average Tangible Common Equity	$	208,264	$	205,962	$	198,899	$	195,139	$	195,932	$	203,253	$	183,817

Reconciliation of Net Income, Excluding Acquisition Related Costs and Deferred Tax Asset Adjustments


	For the Three Months Ended												For the Twelve Months Ended
	Dec. 31,			Sept. 30,		June 30,		March 31,		Dec. 31,			Dec. 31,			Dec. 31,
	2018			2018		2018		2018		2017			2018			2017
Net income	$	8,686		$	8,084	$	8,073	$	7,726	$	5,235		$	32,569		$	22,711
Acquisition related costs - tax equated		(180	)		0		0		22		(48	)		(158	)		283
Deferred tax asset adjustments		0			0		0		0		1,793			0			1,793

Net income - Adjusted	$	8,506		$	8,084	$	8,073	$	7,748	$	6,980		$	32,411		$	24,787

Average basic shares outstanding		27,781			27,695		27,641		27,918		27,941			27,675			27,568
EPS excluding acquisition costs and deferred tax asset adjustments	$	0.31		$	0.29	$	0.29	$	0.28	$	0.25		$	1.17		$	0.90


	For the Three Months Ended
	Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,
End of Period Loan Balances	2018		2018		2018		2018		2017
Commercial real estate	$	579,481	$	562,272	$	523,417	$	511,628	$	513,707
Commercial		245,172		233,188		232,672		231,498		220,441
Residential real estate		492,887		489,851		479,486		472,350		469,442
Consumer		216,284		220,826		219,138		210,088		207,851
Agricultural loans		199,013		182,038		181,173		170,725		163,081

Total, excluding net deferred loan costs	$	1,732,837	$	1,688,175	$	1,635,886	$	1,596,289	$	1,574,522


	For the Three Months Ended
	Dec. 31,		Sept. 30,			June 30,		March 31,		Dec. 31,
Noninterest Income	2018		2018			2018		2018		2017
Service charges on deposit accounts	$	1,115	$	1,151		$	985	$	1,003	$	1,060
Bank owned life insurance income		221		219			219		222		246
Trust fees		1,752		1,827			1,740		1,807		1,622
Insurance agency commissions		642		567			713		699		530
Security gains		260		(34	)		27		18		5
Retirement plan consulting fees		370		470			465		379		465
Investment commissions		259		273			315		256		260
Net gains on sale of loans		832		804			606		487		810
Debit card and EFT fees		861		814			870		806		830
Other operating income		393		387			366		333		223

Total Noninterest Income	$	6,705	$	6,478		$	6,306	$	6,010	$	6,051


	For the Three Months Ended
	Dec. 31,			Sept. 30,		June 30,		March 31,		Dec. 31,
Noninterest Expense	2018			2018		2018		2018		2017
Salaries and employee benefits	$	9,444		$	8,966	$	8,828	$	8,738	$	8,697
Occupancy and equipment		1,566			1,597		1,611		1,704		1,528
State and local taxes		474			475		479		459		386
Professional fees		734			687		737		698		643
Merger related costs		(180	)		0		0		25		88
Advertising		416			489		379		275		561
FDIC insurance		234			218		225		222		165
Intangible amortization		355			354		355		354		386
Core processing charges		762			778		794		739		806
Telephone and data		288			298		238		237		241
Other operating expenses		1,890			2,318		1,812		1,645		1,517

Total Noninterest Expense	$	15,983		$	16,180	$	15,458	$	15,096	$	15,018

Average Balance Sheets and Related Yields and Rates

(Dollar Amounts in Thousands)


	Three Months Ended							Three Months Ended
	December 31, 2018							December 31, 2017
	AVERAGE							AVERAGE
	BALANCE		INTEREST (1)		RATE (1)			BALANCE		INTEREST (1)		RATE (1)
EARNING ASSETS
Loans (2)	$	1,706,008	$	21,424		4.98	%	$	1,546,368	$	18,411		4.72	%
Taxable securities		199,472		1,241		2.47			210,913		1,245		2.34
Tax-exempt securities (2)		202,241		1,936		3.80			180,539		1,976		4.34
Equity securities		11,822		185		6.21			10,516		163		6.15
Federal funds sold and other		29,663		154		2.06			36,661		123		1.33

Total earning assets		2,149,206		24,940		4.60			1,984,997		21,918		4.38
Nonearning assets		152,641							173,898

Total assets	$	2,301,847						$	2,158,895

INTEREST-BEARING LIABILITIES
Time deposits	$	324,696	$	1,349		1.65	%	$	255,414	$	732		1.14	%
Brokered time deposits		272		2		2.35			0		0		0
Savings deposits		438,008		284		0.26			512,034		186		0.14
Demand deposits		578,470		1,128		0.77			429,603		359		0.33
Short term borrowings		264,371		1,562		2.34			282,026		695		0.98
Long term borrowings		6,089		48		3.13			7,684		45		2.32

Total interest-bearing liabilities	$	1,611,906		4,373		1.08		$	1,486,761		2,017		0.54

NONINTEREST-BEARING LIABILITIES AND STOCKHOLDERS’ EQUITY
Demand deposits		423,576							414,719
Other liabilities		13,916							15,861
Stockholders’ equity		252,449							241,554

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	2,301,847						$	2,158,895

Net interest income and interest rate spread			$	20,567		3.52	%			$	19,901		3.84	%

Net interest margin						3.80	%						3.98	%

(1)	Interest and yields are calculated on a tax-equivalent basis where applicable.

(2)

For 2018, adjustments of $92 thousand and $401 thousand, respectively, were made to tax equate income on tax exempt loans and tax exempt securities. For 2017, adjustments of $148 thousand and $686 thousand, respectively, were made to tax equate income on tax exempt loans and tax exempt securities. These adjustments were based on a marginal federal income tax rate of 21% for 2018 and 35% for 2017, less disallowances.


	Twelve Months Ended							Twelve Months Ended
	December 31, 2018							December 31, 2017
	AVERAGE							AVERAGE
	BALANCE		INTEREST (1)		RATE (1)			BALANCE		INTEREST (1)		RATE (1)
EARNING ASSETS
Loans (2)	$	1,632,541	$	80,192		4.91	%	$	1,493,550	$	70,573		4.73	%
Taxable securities		202,270		4,928		2.44			213,634		4,899		2.29
Tax-exempt securities		194,302		7,195		3.70			167,824		7,293		4.35
Equity securities (2)		11,382		652		5.73			10,285		537		5.22
Federal funds sold and other		34,006		644		1.89			37,880		394		1.04

Total earning assets		2,074,501		93,611		4.51			1,923,173		83,696		4.35
Nonearning assets		155,879							159,274

Total assets	$	2,230,380						$	2,082,447

INTEREST-BEARING LIABILITIES
Time deposits	$	293,725	$	4,210		1.43	%	$	242,650	$	2,565		1.06	%
Brokered time deposits		68		2		2.35			0		0		0
Savings deposits		465,283		1,015		0.22			521,099		728		0.14
Demand deposits		506,099		2,912		0.58			405,062		1,197		0.30
Short term borrowings		281,063		4,936		1.76			270,949		2,167		0.80
Long term borrowings		6,491		190		2.93			9,739		224		2.30

Total interest-bearing liabilities	$	1,552,729		13,265		0.85		$	1,449,499		6,881		0.47

NONINTEREST-BEARING LIABILITIES AND STOCKHOLDERS’ EQUITY
Demand deposits	$	415,968						$	390,230
Other liabilities		13,718							13,755
Stockholders’ equity		247,965							228,963

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	2,230,380						$	2,082,447

Net interest income and interest rate spread			$	80,346		3.66	%			$	76,815		3.88	%

Net interest margin						3.87	%						3.99	%

(1)	Interest and yields are calculated on a tax-equivalent basis where applicable.

(2)

For 2018, adjustments of $357 thousand and $1.5 million, respectively, were made to tax equate income on tax exempt loans and tax exempt securities. For 2017, adjustments of $639 thousand and $2.5 million, respectively, were made to tax equate income on tax exempt loans and tax exempt securities. These adjustments were based on a marginal federal income tax rate of 21% for 2018 and 35% for 2017, less disallowances.