CNB Financial Corporation (CCNE): Business Model Canvas [11-2024 Updated]

In the evolving landscape of community banking, CNB Financial Corporation (CCNE) stands out with a robust business model designed to meet the unique needs of its customers. From fostering key partnerships with local organizations to offering personalized banking solutions, CCNE's approach emphasizes relationship banking and community engagement. Discover how this financial institution leverages its resources, activities, and customer relationships to create value and drive growth in the competitive banking sector.

CNB Financial Corporation (CCNE) - Business Model: Key Partnerships

Collaborations with Federal Home Loan Bank

CNB Financial Corporation maintains a robust relationship with the Federal Home Loan Bank of Pittsburgh (FHLB). As of September 30, 2024, the Corporation had a line-of-credit with the FHLB amounting to $250 million, which is a revolving term commitment available on an overnight basis. The total loans pledged to the FHLB were $2.1 billion, up from $1.8 billion at December 31, 2023. The potential advances available from the FHLB increased to approximately $1.2 billion as of September 30, 2024, compared to $993.8 million at the end of the previous year.

Relationships with Correspondent Banks

CNB Financial has established significant relationships with various correspondent banks, which facilitate access to additional liquidity and funding sources. As of September 30, 2024, the Corporation reported an available borrowing capacity through correspondent banks amounting to $4.5 billion. These relationships are critical for managing liquidity and supporting the Corporation's lending activities.

Partnerships with Community Development Entities

The Corporation actively invests in community development entities (CDEs) to support local economic growth. As of September 30, 2024, CNB Financial's capital contributions to investments in small business investment corporations (SBICs) and CDEs totaled $22.9 million, with unfunded capital commitments amounting to $8.6 million. This represents a strategic effort to enhance community development while also generating returns on investment.

Engagements with Small Business Investment Corporations

CNB Financial has strengthened its engagements with small business investment corporations (SBICs). The Corporation reported an increase in non-interest income from SBICs, contributing to the total non-interest income of $28.8 million for the nine months ended September 30, 2024, compared to $24.2 million for the same period in 2023. This increase underscores the importance of SBIC partnerships in enhancing the Corporation's revenue streams.

Partnership Type	Details	Financial Data
Federal Home Loan Bank	Line-of-credit and loan pledges	Line-of-credit: $250 million Loans pledged: $2.1 billion
Correspondent Banks	Liquidity and funding access	Borrowing capacity: $4.5 billion
Community Development Entities	Investment in local economic growth	Capital contributions: $22.9 million Unfunded commitments: $8.6 million
Small Business Investment Corporations	Revenue generation through investments	Non-interest income from SBICs: $28.8 million

CNB Financial Corporation (CCNE) - Business Model: Key Activities

Providing banking services to individuals and businesses

As of September 30, 2024, CNB Financial Corporation had total deposits amounting to $5.22 billion, reflecting a year-to-date increase of $218.2 million or 4.37% from December 31, 2023. The bank offers a variety of services including checking and savings accounts, loans, and credit products, catering to both individual and commercial clients.

Managing loan and deposit portfolios

As of the same date, the total loans, excluding syndicated loans, reached $4.5 billion, an increase of $162.7 million or 3.73% year-to-date. The loan portfolio is diversified across various segments, including residential mortgages, commercial real estate, and consumer loans.

Loan Type	Amount (in millions)	Percentage of Total Loans
Residential Mortgages	1,012.0	22.5%
Commercial Real Estate	1,016.0	22.6%
Consumer Loans	1,411.9	31.4%
Commercial and Industrial	695.1	15.5%
Other Loans	364.0	8.0%

Risk management through credit assessments

The provision for credit losses was $6.3 million for the nine months ended September 30, 2024, compared to $4.8 million for the same period in 2023. This increase was primarily attributed to higher loan growth and an increase in net loan charge-offs. The Corporation continues to monitor credit quality closely, utilizing a range of assessments to manage risk effectively.

Credit Quality Category	Amount (in millions)
Performing Loans	1,411.9
Nonperforming Loans	12.3
Loan Charge-Offs	5.4

Offering investment products and insurance services

CNB Financial Corporation's non-interest income reached $28.8 million for the nine months ended September 30, 2024, an increase from $24.2 million in the same period in 2023. This growth was driven by higher pass-through income from Small Business Investment Companies (SBICs) and gains from equity securities. The Corporation offers a suite of investment products and insurance services to complement its banking operations.

CNB Financial Corporation (CCNE) - Business Model: Key Resources

Cash and Cash Equivalents

As of September 30, 2024, CNB Financial Corporation reported cash and cash equivalents totaling $360.9 million. This includes $282.0 million held at the Federal Reserve, which provides a significant liquidity buffer for operational needs and potential investment opportunities.

Investment Securities

CNB Financial holds a diverse portfolio of investment securities, with a total amount of $389.4 million as of September 30, 2024. This portfolio is crucial for generating income and maintaining liquidity. The composition includes both available-for-sale (AFS) and held-to-maturity (HTM) securities.

Type of Securities	Amount ($ Million)	Yield (%)
AFS Debt Securities	378.965	2.76
HTM Debt Securities	328.2	N/A
Total Investment Securities	389.4	N/A

Robust Loan Portfolio

The corporation's loan portfolio is a cornerstone of its operations, amounting to $4.59 billion as of September 30, 2024. This portfolio includes a variety of loan types, with commercial loans being a significant component.

Loan Type	Amount ($ Million)	Percentage of Total Loans (%)
Commercial Loans	1,457.2	31.7
Residential Mortgages	629.5	13.7
Consumer Loans	3,183.7	69.4
Total Loans	4,591.9	100.0

Experienced Management Team and Staff

CNB Financial Corporation is led by an experienced management team that brings extensive industry knowledge and expertise. The organization emphasizes the importance of skilled personnel in delivering quality service and maintaining operational efficiency.

As of September 30, 2024, the corporation's efficiency ratio stood at 66.34%, indicating effective management of operational costs relative to income generated.

CNB Financial Corporation (CCNE) - Business Model: Value Propositions

Personalized banking solutions tailored for local communities

CNB Financial Corporation focuses on delivering personalized banking solutions that cater specifically to local community needs. This strategy is evident in their expansion of services such as the 'At Ease' account tailored for U.S. service members and veterans, and the women-focused banking division, Impressia Bank, which aims to empower female customers through specialized financial products.

Competitive interest rates on loans and deposits

As of September 30, 2024, CNB Financial offers competitive interest rates on loans and deposits, reflecting their strategy to attract and retain customers. The average interest rate on time deposits was 4.03%, while savings deposits yielded an average of 3.55%. The yield on earning assets increased to 5.89%, up 41 basis points from the previous year, indicating a strong performance in loan generation and deposit retention.

Commitment to customer service and financial education

CNB Financial places a strong emphasis on customer service and financial education, which is integral to their value proposition. The bank has invested in technology and personnel to enhance customer interactions and provide educational resources, ensuring clients are well-informed about their financial options. This commitment is reflected in their efficiency ratio, which improved to 66.34% for the third quarter of 2024, compared to 67.00% in the same period of 2023.

Diverse product offerings including loans, investment, and insurance

CNB Financial provides a wide range of products designed to meet diverse customer needs. As of September 30, 2024, total loans receivable amounted to $4.0 billion, with commercial loans contributing significantly to growth. The bank’s non-interest income also saw an increase to $28.8 million for the nine months ended September 30, 2024, driven by higher pass-through income from small business investment companies and net gains on equity securities.

Product/Service	Interest Rate	Loan Amounts	Non-Interest Income (9M 2024)
Time Deposits	4.03%	N/A	N/A
Savings Deposits	3.55%	N/A	N/A
Total Loans Receivable	N/A	$4.0 billion	N/A
Non-Interest Income	N/A	N/A	$28.8 million

CNB Financial Corporation (CCNE) - Business Model: Customer Relationships

Strong focus on relationship banking

CNB Financial Corporation emphasizes a strong relationship banking model, prioritizing personalized service and long-term client engagement. As of September 30, 2024, total deposits reached approximately $5.2 billion, an increase of 4.37% from the previous year, driven by heightened focus on customer relationships.

Dedicated customer service teams

The corporation has invested in dedicated customer service teams to enhance client interactions. In the nine months ended September 30, 2024, total non-interest expenses were $112.2 million, reflecting an increase primarily attributed to higher salaries and benefits related to personnel expansion. This investment supports improved service delivery across various customer segments.

Community engagement through local events

CNB actively engages with local communities, hosting events that foster relationships and brand loyalty. The corporation's community initiatives have contributed to a 1.85% increase in the total number of deposit households. This engagement is essential for maintaining strong local ties and enhancing customer trust in the brand.

Digital banking services for convenience

Digital banking offerings have expanded significantly, with average interest-bearing deposits with the Federal Reserve totaling $244.6 million as of September 30, 2024. The convenience of online banking services has attracted a diverse clientele, further supporting the bank's growth in deposits and enhancing customer satisfaction.

Metric	Value
Total Deposits (Sept 30, 2024)	$5.2 billion
Non-Interest Expenses (Nine Months Ended Sept 30, 2024)	$112.2 million
Increase in Deposit Households	1.85%
Average Interest-Bearing Deposits with Federal Reserve	$244.6 million

CNB Financial Corporation (CCNE) - Business Model: Channels

Branch locations across Central and Northwest Pennsylvania

As of September 30, 2024, CNB Financial Corporation operates a network of 30 branch locations throughout Central and Northwest Pennsylvania. This extensive presence enables the bank to serve a diverse customer base effectively, focusing on both retail and commercial banking services. The total deposits held at these branches reached approximately $5.2 billion, reflecting a 4.37% increase from December 31, 2023 .

Online banking platform for easy access

CNB Financial Corporation has enhanced its digital banking capabilities through a comprehensive online banking platform. This service allows customers to manage their accounts, transfer funds, and apply for loans online. As of September 30, 2024, the bank reported that over 60% of transactions were conducted through digital channels, highlighting the increasing preference for online banking among customers.

Mobile banking applications for on-the-go services

The mobile banking application launched by CNB Financial Corporation provides customers with 24/7 access to their accounts. Features include mobile check deposits, fund transfers, and bill payments. The adoption rate of the mobile app has surged, with more than 30,000 downloads recorded as of September 30, 2024. This has significantly contributed to customer engagement and satisfaction.

Customer service hotline for direct support

CNB Financial Corporation maintains a dedicated customer service hotline that operates 24/7. In the third quarter of 2024, the bank received approximately 15,000 calls through this hotline, with an average response time of under 2 minutes. This commitment to customer service ensures that clients receive timely assistance and support.

Channel	Details	Statistics
Branch Locations	Physical presence across Central and Northwest Pennsylvania	30 branches, $5.2 billion in total deposits
Online Banking	Comprehensive online services for account management	Over 60% of transactions via digital channels
Mobile Banking	24/7 access through mobile application	30,000+ downloads, features mobile check deposits
Customer Service Hotline	24/7 support for customer inquiries	15,000 calls received, average response time under 2 minutes

CNB Financial Corporation (CCNE) - Business Model: Customer Segments

Individual consumers seeking personal banking services

CNB Financial Corporation serves individual consumers with a range of personal banking services, including checking and savings accounts, loans, and credit cards. As of September 30, 2024, the Bank's total deposits amounted to approximately $5 billion, reflecting a robust base of individual customers utilizing these services.

Small to medium-sized businesses needing financing

The Corporation actively targets small to medium-sized businesses (SMBs) for lending and financing solutions. As of September 30, 2024, loans to commercial customers totaled approximately $1.8 billion, accounting for a significant portion of the loan portfolio. The Corporation has reported a year-to-date increase of 3.73% in loans, driven by qualitative growth in commercial real estate and industrial sectors.

Customer Segment	Loan Amount (in billions)	Percentage of Total Loans
Commercial Customers	$1.8	40%
Individual Consumers	$4.5	60%

Community organizations and non-profits

CNB Financial Corporation also focuses on community organizations and non-profits, offering tailored financial products to meet their unique needs. The Bank has made significant investments in community development entities, with capital contributions totaling $22.9 million as of September 30, 2024. This reflects a commitment to supporting local organizations through financial services.

Investors looking for financial products

The Corporation caters to investors by offering a range of financial products, including wealth management and investment services. As of September 30, 2024, CNB Financial reported $341.9 million in debt securities available-for-sale, highlighting their focus on providing investment opportunities for individual and institutional investors. Additionally, the Corporation's capital ratios indicate a strong position for investment stability, with a total risk-based ratio of 16.06%.

Financial Metric	Value
Total Debt Securities Available-for-Sale	$341.9 million
Total Risk-Based Ratio	16.06%

CNB Financial Corporation (CCNE) - Business Model: Cost Structure

Operational costs for branch maintenance and staffing

Total non-interest expense for the nine months ended September 30, 2024, was $112.2 million, compared to $106.9 million for the same period in 2023, an increase of $5.3 million or 4.96%. This increase was primarily driven by higher salaries and benefits associated with personnel added for new branches in expansion markets, as well as annual merit increases and increases in health insurance costs.

Interest expenses on deposits and borrowings

For the nine months ended September 30, 2024, CNB Financial Corporation reported interest expense of $35.7 million. This was a significant increase compared to $28.3 million for the same period in 2023. The average rate on interest-bearing liabilities was 3.21% for the nine months ended September 30, 2024, compared to 2.66% for the same period in 2023. Additionally, the yield on earning assets was 5.98% for the three months ended September 30, 2024.

Marketing and promotional expenses

While specific figures for marketing and promotional expenses were not disclosed, the overall increase in non-interest expense, which includes marketing costs, was attributed to expanding the Corporation's reach and enhancing brand recognition in new markets. The total marketing expenses are typically part of the broader non-interest expense line item, which amounted to $112.2 million for the nine months ending September 30, 2024.

Investment in technology and digital banking infrastructure

Investment in technology applications increased due to contractual renewal increases, with significant allocations aimed at enhancing customer online banking capabilities and in-branch technology delivery channels. For the nine months ended September 30, 2024, the Corporation's non-interest expense included technology investments that contributed to operational efficiency and customer satisfaction.

Cost Component	Amount (9M 2024)	Amount (9M 2023)	Percentage Change
Total Non-Interest Expense	$112.2 million	$106.9 million	4.96%
Interest Expense	$35.7 million	$28.3 million	26.8%
Average Rate on Interest-Bearing Liabilities	3.21%	2.66%	20.7%
Yield on Earning Assets (Q3 2024)	5.98%	5.63%	6.2%

CNB Financial Corporation (CCNE) - Business Model: Revenue Streams

Interest income from loans and mortgages

The primary source of revenue for CNB Financial Corporation (CCNE) comes from interest income generated through loans and mortgages. For the three months ended September 30, 2024, the net interest income was reported at $47.5 million, which represents a slight increase from $47.2 million for the same period in 2023. The yield on earning assets was 5.98%, up from 5.63% year-over-year, primarily due to higher interest rates affecting variable-rate loans and new loan production.

Fees from banking services and transactions

CNB Financial also generates significant revenue from fees associated with banking services and transactions. For the three months ended September 30, 2024, total non-interest income was $11.0 million, an increase from $7.9 million during the same period in 2023. This increase is largely attributed to higher pass-through income from small business investment companies as well as net realized and unrealized gains on equity securities.

Investment income from securities and partnerships

Investment income is another vital revenue stream for CCNE. The corporation reported total investment income of $241.8 million for the nine months ended September 30, 2024, compared to $214.5 million for the same period in 2023. This growth reflects the corporation's strategic investments and partnerships that have yielded higher returns in a favorable interest rate environment.

Non-interest income from insurance and other services

Non-interest income, which includes income from insurance and other services, amounted to $28.8 million for the nine months ended September 30, 2024, compared to $24.2 million in the prior year. This growth is indicative of the corporation's expanding service offerings and the successful integration of insurance products into its overall banking services.

Revenue Stream	Q3 2024	Q3 2023	Change (%)
Net Interest Income	$47.5 million	$47.2 million	0.53%
Non-Interest Income	$11.0 million	$7.9 million	39.24%
Investment Income	$241.8 million	$214.5 million	12.70%
Non-Interest Income (Insurance & Other)	$28.8 million	$24.2 million	19.05%

Updated on 16 Nov 2024

Resources:

1. CNB Financial Corporation (CCNE) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of CNB Financial Corporation (CCNE)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View CNB Financial Corporation (CCNE)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.