ACNB Corporation (NASDAQ: ACNB), financial holding company for ACNB Bank and Russell Insurance Group Inc., announced financial results for the three months ending March 31, with net income of $5,864,000.

Compared to net income of $4,913,000 for the quarter ended March 31, 2018, this is an increase of $951,000 or 19.4 percent over comparable period results. Basic earnings per share was $0.83 and $0.70 for the three months ended March 31, 2019 and 2018, respectively, which is an increase of $0.13 or 18.6 percent.

“ACNB Corporation’s strong earnings performance for the first quarter of 2019 was primarily the result of higher net interest income over the same period a year ago due to solid loan growth in late 2018,” said James P. Helt, ACNB Corporation president and CEO. “In working with commercial loan customers, our organization’s primary driver of loan growth, we continually strive to build relationships and find solutions as the keystone of ACNB Corporation’s strategic vision. Geographic expansion initiatives, such as the planned opening of the Lancaster Loan Office in May 2019, further this vision.”

“Solid banking and insurance operations have produced both current and future benefits for ACNB Corporation and its shareholders. As previously announced, the board of directors declared an increase in the quarterly dividend amount from $0.23 to $0.25 per share for payment on June 14, 2019,” Helt said. “Coupled with the 15 percent increase in the quarterly dividend amount paid per share in June 2018, our commitment to ACNB Corporation shareholders is evident with an aggregate 25 percent increase in the quarterly dividend amount per share since the first quarter of 2018.”

Revenues

Total revenues, defined as net interest income plus non-interest income, for the first quarter of 2019 were $18,605,000, or a 7.7 percent increase over total revenues of $17,274,000 for the first quarter of 2018.

Loans

Total loans outstanding were $1,301,335,000 at March 31, 2019. Loans outstanding decreased by $1,130,000, or 0.1 percent, due to seasonality and early payoffs since Dec. 31, 2018, and increased by $63,581,000, or 5.1 percent, from March 31, 2018 to March 31, 2019. Year over year, loan growth is primarily in the commercial loan portfolio with a focus on asset quality and disciplined underwriting standards despite the intense competition in the corporation’s market areas. As a result of normal and anticipated credit losses in the portfolio, the provision for loan losses for the first quarter of 2019 was $150,000.

Deposits

Total deposits were $1,367,058,000 at March 31, 2019. Deposits increased by $18,966,000, or 1.4 percent, from Dec. 31, 2018, and $53,644,000, or 4.1 percent, from March 31, 2018 to March 31, 2019. Year over year, deposit growth is a function of pricing and the level of deposits held by existing and new customers, especially in the segment of municipal depositors.

Net interest income/margin

Net interest income rose by $1,103,000 to $14,665,000 for the first quarter of 2019, which is an increase of 8.1 percent compared to the first quarter of 2018.

The net interest margin for the first quarter of 2019 was 3.93 percent, compared to 3.77 percent for the same period of 2018.

Both net interest income and the net interest margin were positively impacted by the organic growth in loans experienced from March 31, 2018 to March 31, 2019.

Non-interest income

Non-interest income for the first quarter of 2019 was $3,940,000, an increase of $228,000, or 6.1 percent, from the first quarter of 2018.

The increase includes both revenue from fiduciary, investment management and brokerage activities and commissions from insurance sales, which grew 3.7 percent and 9.9 percent, respectively, from the first quarter of 2018 to the first quarter of 2019.

Non-interest expense

Non-interest expense for the first quarter of 2019 was $11,261,000, an increase of $275,000, or 2.5 percent, from the same period in 2018.

The increase in non-interest expense is attributable to normal business operations and a growing community banking footprint, both balanced by management’s continued focus on expense control.

Dividends

Quarterly cash dividends paid to ACNB Corporation shareholders in the first quarter of 2019 totaled $1,621,000, or $0.23 per share.

In the first quarter of 2018, ACNB Corporation paid $0.20 per share for total dividends paid to shareholders in the amount of $1,405,000.

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