Core Insights - ACNB Corporation reported a net income of $14.9 million, or $1.42 diluted earnings per share, for Q3 2025, a significant increase from $7.2 million, or $0.84 per share, in Q3 2024 and $11.6 million, or $1.11 per share, in Q2 2025 [1][4]. Financial Performance - The acquisition of Traditions Bancorp, completed on February 1, 2025, impacted ACNB's financial results, making comparisons to prior periods less direct [3]. - Net interest income for Q3 2025 was $32.1 million, up $1.1 million from Q2 2025 and $11.2 million from Q3 2024, with a net interest margin of 4.27%, reflecting increases from both previous quarters [6][10]. - Noninterest income for Q3 2025 was $8.4 million, a decrease from Q2 2025 but an increase from Q3 2024, driven by various factors including insurance commissions and service charges [8]. Asset Quality and Loans - Total loans outstanding were $2.34 billion at the end of Q3 2025, a decrease from Q2 2025 but an increase of $659.5 million from Q3 2024, with a loan yield of 6.29% [10][11]. - The allowance for credit losses was $23.7 million, showing a decrease from Q2 2025 but an increase from Q3 2024 [11]. Deposits and Borrowings - Total deposits were $2.47 billion at the end of Q3 2025, a decrease from Q2 2025 but an increase of $674.6 million from Q3 2024, with noninterest-bearing deposits increasing significantly [12]. - Total borrowings increased to $335.8 million, driven by short-term borrowings [13]. Stockholders' Equity - Total stockholders' equity rose to $408.6 million at the end of Q3 2025, up from $395.2 million in Q2 2025 and $306.8 million in Q3 2024, primarily due to net income and unrealized gains [14].

Executive Summary This section provides a high-level overview of ACNB Corporation's strong Q3 2025 financial performance, including record profitability and strategic insights from the CEO [Q3 2025 Financial Highlights](index=1&type=section&id=Q3%202025%20Financial%20Highlights) ACNB Corporation reported record Q3 2025 net income and diluted EPS, with improved net interest margin and stable asset quality, significantly impacted by the Traditions Bancorp acquisition **Q3 2025 Key Financial Performance:** | Metric | Q3 2025 | Q2 2025 | Q3 2024 | | :-------------------------------- | :------ | :------ | :------ | | Net Income (in millions) | $14.9 | $11.6 | $7.2 | | Diluted EPS | $1.42 | $1.11 | $0.84 | | FTE Net Interest Margin | 4.27% | 4.21% | 3.77% | | Return on Average Assets | 1.80% | N/A | N/A | | Return on Average Equity | 14.66% | N/A | N/A | - Total non-performing loans to total loans, net of unearned income, was **0.43%** at September 30, 2025, **stable** compared to June 30, 2025, but up from **0.39%** at September 30, 2024[5](index=5&type=chunk) - The Board of Directors **approved** a regular quarterly cash dividend of **$0.38 per share** for the fourth quarter, an **11.8% increase** over the prior quarter and an **18.8% increase** over the same period of 2024[5](index=5&type=chunk) - ACNB **repurchased** **61,586 shares** of common stock in open market transactions for the three months ended September 30, 2025[6](index=6&type=chunk) - Financial results for the first three quarters of 2025 were **impacted by** the **acquisition of Traditions Bancorp, Inc.** on February 1, 2025, **making direct comparisons to prior reported periods potentially not comparable**[6](index=6&type=chunk) [CEO's Statement](index=3&type=section&id=CEO%27s%20Statement) CEO James P. Helt highlighted record profitability, stable asset quality, and active capital management, crediting community banking and the Traditions Bank integration - **ACNB Corporation** reported **strong profitability** and **record** quarterly net income for **Q3 2025**, reflecting **commitment to community banking** and **successful integration of Traditions Bank**[7](index=7&type=chunk) - The quarter featured **stable asset quality** metrics, **increased profitability**, and **active capital management** strategies, including **share repurchases** and a **strong dividend**[8](index=8&type=chunk) - Management aims to finish the year **strong** by managing economic cycles and **diversifying revenue streams** through ACNB Insurance Services, ACNB Wealth Management, and Traditions Mortgage for **long-term shareholder growth**[8](index=8&type=chunk) Financial Performance Analysis This section analyzes ACNB Corporation's financial performance, focusing on net interest income, noninterest income, and noninterest expense trends [Net Interest Income and Margin](index=3&type=section&id=Net%20Interest%20Income%20and%20Margin) Net interest income significantly increased YoY and moderately QoQ, driven by higher earning assets and improved FTE net interest margin, influenced by lower deposit costs from the Traditions acquisition **Net Interest Income & Margin Trends:** | Metric | Q3 2025 | Q2 2025 | Q3 2024 | | :---------------------- | :------ | :------ | :------ | | Net Interest Income (in millions) | $32.1 | $31.0 | $20.9 | | FTE Net Interest Margin | 4.27% | 4.21% | 3.77% | - The **increase** in **FTE net interest margin** from **Q2 2025** was **primarily due to** a **7 basis points decrease** in the cost of interest-bearing deposits, resulting from **lower rates** on **higher cost deposits** and **reduced balances** from the **Traditions Acquisition**[10](index=10&type=chunk) - Total average earning assets **increased by** **$28.5 million** **quarter-over-quarter**, and total average noninterest-bearing demand deposits **increased by** **$30.5 million** **quarter-over-quarter**[10](index=10&type=chunk) - **Year-over-year**, total average loans **increased by** **$675.4 million**, with the yield on total loans **rising by** **73 basis points** to **6.29%** for **Q3 2025**[11](index=11&type=chunk) [Noninterest Income](index=5&type=section&id=Noninterest%20Income) Noninterest income slightly decreased QoQ but notably increased YoY, driven by lower insurance commissions and higher gains from mortgage loans and service charges, partially due to the acquisition **Noninterest Income (in thousands):** | Category | Q3 2025 | Q2 2025 | Q3 2024 | | :-------------------------------- | :------ | :------ | :------ | | Total Noninterest Income | $8,411 | $8,682 | $6,833 | | Insurance commissions | $2,545 | $2,908 | $2,787 | | Gain from mortgage loans held for sale | $1,463 | $1,575 | $112 | | Service charges on deposits | $1,286 | $1,179 | $1,048 | - The **decrease** in insurance commissions **QoQ** was **primarily due to** **lower contingent commission income**, and **YoY due to timing of policy renewals** and a **$121 thousand decrease** from one customer's policy cancellation[13](index=13&type=chunk) - Service charges on deposits **increased YoY primarily due to** the **Traditions Acquisition** and an **increase** in **overall customer activity**[13](index=13&type=chunk) [Noninterest Expense](index=5&type=section&id=Noninterest%20Expense) Noninterest expense significantly decreased QoQ due to lower merger-related costs and salaries, but increased YoY due to acquisition-related personnel and operational expenses **Noninterest Expense (in thousands):** | Category | Q3 2025 | Q2 2025 | Q3 2024 | | :-------------------------------- | :------ | :------ | :------ | | Total Noninterest Expenses | $22,361 | $25,366 | $18,244 | | Merger-related expenses | $169 | $1,900 | $1,100 | | Salaries and employee benefits | $13,191 | $13,693 | $11,017 | | Intangible assets amortization | $1,129 | $1,141 | $304 | - Salaries and employee benefits **decreased QoQ primarily due to** a **higher employee vacancy rate**, **lower incentive compensation**, **lower overtime**, conversion-related expenses, and **lower health insurance expense**[14](index=14&type=chunk) - Salaries and employee benefits **increased YoY primarily due to** **additional employees attributable to the Acquisition**, merit increases, and **higher mortgage commissions**[14](index=14&type=chunk) - Intangible assets amortization **increased by** **$825 thousand YoY** as a **direct result** of the **Traditions Acquisition**[15](index=15&type=chunk) Balance Sheet and Asset Quality This section examines ACNB Corporation's balance sheet, focusing on loans, asset quality, deposits, borrowings, and stockholders' equity [Loans and Asset Quality](index=6&type=section&id=Loans%20and%20Asset%20Quality) Total loans and asset quality metrics showed stability QoQ and significant growth YoY, primarily due to the Traditions acquisition **Loans and Asset Quality (in thousands):** | Metric | Sept 30, 2025 | June 30, 2025 | Sept 30, 2024 | | :-------------------------------- | :------------ | :------------ | :------------ | | Total loans outstanding | $2,336,605 | $2,341,816 | $1,677,112 | | Allowance for credit losses | $23,660 | $24,353 | $17,214 | | Total non-performing loans to total loans | 0.43% | 0.43% | 0.39% | - The **YoY increase** in total loans was spread across all loan categories and was **driven primarily by the Traditions Acquisition**[17](index=17&type=chunk) - The **QoQ decrease** in allowance for credit losses was **driven primarily by the movement of construction loans to lower loss rate segments** and the **paydowns of loans with a specific reserve**[17](index=17&type=chunk) [Deposits and Borrowings](index=7&type=section&id=Deposits%20and%20Borrowings) Total deposits decreased QoQ but significantly increased YoY, largely due to the Traditions acquisition, while borrowings also increased **Deposits and Borrowings (in thousands):** | Metric | Sept 30, 2025 | June 30, 2025 | Sept 30, 2024 | | :-------------------------------- | :------------ | :------------ | :------------ | | Total Deposits | $2,465,896 | $2,524,541 | $1,791,317 | | Total Interest-Bearing Deposits | $1,884,199 | $1,956,240 | $1,327,816 | | Noninterest-Bearing Deposits | $581,697 | $568,301 | $463,501 | | Total Borrowings | $335,833 | $298,395 | $293,091 | - The **QoQ decreases** in money market and time deposits were **driven primarily by lower balances of higher cost deposits from the Acquisition** and a **net decline of $20.0 million** of short-term brokered deposits[18](index=18&type=chunk) - The **overall increase** in total deposits compared to September 30, 2024, was **driven primarily by the Traditions Acquisition**[18](index=18&type=chunk) - Total borrowings **increased QoQ primarily due to** an **increase** in short-term borrowings, including a **three-month FHLB borrowing of $25.0 million**[19](index=19&type=chunk) [Stockholders' Equity](index=7&type=section&id=Stockholders%27%20Equity) Total stockholders' equity increased QoQ and YoY, driven by net income, unrealized gains, and common stock issued in the Traditions acquisition **Stockholders' Equity (in thousands):** | Metric | Sept 30, 2025 | June 30, 2025 | Sept 30, 2024 | | :-------------------------------- | :------------ | :------------ | :------------ | | Total Stockholders' Equity | $408,642 | $395,151 | $306,755 | | Tangible book value per share | $30.87 | $29.30 | $29.90 | - The **QoQ increase** in stockholders' equity was **driven primarily by net income of $14.9 million** and a **$4.3 million change in unrealized gains** in available-for-sale investment securities, **partially offset by $3.5 million in dividends paid** and **$2.7 million in common stock repurchased**[21](index=21&type=chunk) - The **YoY increase** in stockholders' equity was **driven primarily by the common stock equity issued in the Traditions Acquisition**[21](index=21&type=chunk) Company Overview ACNB Corporation is a $3.25 billion financial holding company operating through ACNB Bank and ACNB Insurance Services, providing diverse financial services - **ACNB Corporation** is an **independent $3.25 billion financial holding company** headquartered in Gettysburg, PA[22](index=22&type=chunk) - Its **wholly-owned subsidiaries** include **ACNB Bank** (with operating divisions **Traditions Bank** and Traditions Mortgage) and **ACNB Insurance Services, Inc.**[22](index=22&type=chunk) - **ACNB Bank** provides banking and wealth management services through **33 community banking offices** and one loan office in Pennsylvania and Maryland, while **ACNB Insurance Services, Inc.** is a **full-service insurance agency** licensed in **46 states**[22](index=22&type=chunk) Forward-Looking Statements This section cautions that forward-looking statements are subject to risks and uncertainties, advising readers to review SEC filings for comprehensive risk factors - The press release contains **forward-looking statements**, which are **subject to certain risks and uncertainties** such as national, regional, and local economic conditions, competitive factors, and regulatory limitations[24](index=24&type=chunk) - **Actual results may differ materially** from those projected due to factors including inflation, banking instability, governmental policies, new laws, accounting policy changes, business strategy ineffectiveness, and acquisition integration difficulties[24](index=24&type=chunk) - Readers are **cautioned not to place undue reliance** on these **forward-looking statements** and are encouraged to **review risk factors** described in the Corporation's Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K filed with the SEC[25](index=25&type=chunk) Financial Tables This section provides detailed financial tables, including selected data, consolidated statements, and average balances, offering comprehensive insights into ACNB Corporation's performance [Selected Financial Data by Respective Quarter End](index=11&type=section&id=Selected%20Financial%20Data%20by%20Respective%20Quarter%20End) This table presents key financial data, including balance sheet, income statement, profitability, per share, capital, and credit quality metrics for the past five quarters, highlighting the Traditions acquisition's impact **Selected Financial Data by Respective Quarter End (Dollars in thousands, except per share data):** | (Dollars in thousands, except per share data) | September 30, 2025 | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | | :------------------------------------------ | :----------------- | :------------ | :------------- | :---------------- | :----------------- | | **BALANCE SHEET DATA** | | | | | | | Total assets | $ 3,250,838 | $ 3,259,528 | $ 3,270,041 | $ 2,394,830 | $ 2,420,914 | | Total loans, net of unearned income | 2,336,605 | 2,341,816 | 2,322,209 | 1,682,910 | 1,677,112 | | Deposits | 2,465,896 | 2,524,541 | 2,540,009 | 1,792,501 | 1,791,317 | | Stockholders' equity | 408,642 | 395,151 | 386,883 | 303,273 | 306,755 | | **INCOME STATEMENT DATA** | | | | | | | Net interest income | 32,137 | 31,012 | 27,090 | 21,112 | 20,942 | | Noninterest income | 8,411 | 8,682 | 7,184 | 5,803 | 6,833 | | Noninterest expenses | 22,361 | 25,366 | 29,335 | 18,388 | 18,244 | | Net income (loss) | $ 14,870 | $ 11,648 | $ (272) | $ 6,595 | $ 7,204 | | **PROFITABILITY RATIOS** | | | | | | | Return on average assets (annualized) | 1.80 % | 1.43 % | (0.04) % | 1.08 % | 1.17 % | | Return on average equity (annualized) | 14.66 | 11.96 | (0.31) | 8.57 | 9.63 | | FTE Net interest margin | 4.27 | 4.21 | 4.07 | 3.81 | 3.77 | | **PER SHARE DATA** | | | | | | | Diluted earnings (loss) per share | $ 1.42 | $ 1.11 | $ (0.03) | $ 0.77 | $ 0.84 | | Tangible book value per share | 30.87 | 29.30 | 28.23 | 29.51 | 29.90 | | **CREDIT QUALITY** | | | | | | | Total non-performing loans to total loans | 0.43 % | 0.43 % | 0.43 % | 0.40 % | 0.39 % | [Consolidated Statements of Condition](index=13&type=section&id=Consolidated%20Statements%20of%20Condition) This table presents consolidated balance sheets for ACNB Corporation, detailing assets, liabilities, and stockholders' equity, showing significant YoY growth largely due to the Traditions acquisition **Consolidated Statements of Condition (Dollars in thousands):** | (Dollars in thousands, except per share data) | September 30, 2025 | June 30. 2025 | September 30, 2024 | | :------------------------------------------ | :----------------- | :------------ | :----------------- | | **ASSETS** | | | | | Total Cash and Cash Equivalents | $ 102,139 | $ 103,109 | $ 58,092 | | Investment securities available for sale | 462,217 | 455,317 | 418,079 | | Loans, net | 2,312,945 | 2,317,463 | 1,659,898 | | Goodwill | 64,449 | 64,449 | 44,185 | | Intangible assets, net | 23,565 | 24,694 | 8,142 | | Total Assets | $ 3,250,838 | $ 3,259,528 | $ 2,420,914 | | **LIABILITIES AND STOCKHOLDERS' EQUITY** | | | | | Noninterest-bearing Deposits | $ 581,697 | $ 568,301 | $ 463,501 | | Interest-bearing Deposits | 1,884,199 | 1,956,240 | 1,327,816 | | Total Deposits | 2,465,896 | 2,524,541 | 1,791,317 | | Short-term borrowings | 80,468 | 43,041 | 37,769 | | Long-term borrowings | 255,354 | 255,322 | 255,365 | | Total Liabilities | 2,842,196 | 2,864,377 | 2,114,159 | | Total Stockholders' Equity | 408,642 | 395,151 | 306,755 | | Total Liabilities and Stockholders' Equity | $ 3,250,838 | $ 3,259,528 | $ 2,420,914 | [Consolidated Income Statements](index=15&type=section&id=Consolidated%20Income%20Statements) This table presents consolidated income statements, showing substantial increases in interest income, net interest income, and net income, largely influenced by the Traditions acquisition **Consolidated Income Statements (Dollars in thousands, except per share data):** | (Dollars in thousands, except per share data) | Three Months Ended September 30, 2025 | Three Months Ended September 30, 2024 | Nine Months Ended September 30, 2025 | Nine Months Ended September 30, 2024 | | :------------------------------------------ | :------------------------------------ | :------------------------------------ | :----------------------------------- | :----------------------------------- | | **INTEREST AND DIVIDEND INCOME** | | | | | | Total Interest and Dividend Income | $ 42,490 | $ 27,241 | $ 120,356 | $ 80,084 | | **INTEREST EXPENSE** | | | | | | Total Interest Expense | 10,353 | 6,299 | 30,117 | 17,585 | | Net Interest Income | 32,137 | 20,942 | 90,239 | 62,499 | | **NONINTEREST INCOME** | | | | | | Total Noninterest Income | 8,411 | 6,833 | 24,277 | 18,927 | | **NONINTEREST EXPENSES** | | | | | | Total Noninterest Expenses | 22,361 | 18,244 | 77,062 | 52,297 | | Income Before Income Taxes | 18,916 | 9,410 | 33,277 | 32,185 | | Income tax expense | 4,046 | 2,206 | 7,031 | 6,934 | | Net Income | $ 14,870 | $ 7,204 | $ 26,246 | $ 25,251 | | **PER SHARE DATA** | | | | | | Diluted earnings | $ 1.42 | $ 0.84 | $ 2.56 | $ 2.96 | [Average Balances, Income and Expenses, Yields and Rates (Quarterly)](index=17&type=section&id=Average%20Balances%2C%20Income%20and%20Expenses%2C%20Yields%20and%20Rates%20%28Quarterly%29) This table details average balances, income, expenses, yields, and rates for earning assets and interest-bearing liabilities across five quarters, illustrating trends in yields, deposit costs, and FTE net interest margin **Average Balances, Income and Expenses, Yields and Rates (Quarterly, Dollars in thousands):** | (Dollars in thousands) | September 30, 2025 | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | | :--------------------- | :----------------- | :------------ | :------------- | :---------------- | :----------------- | | **ASSETS** | | | | | | | Total Loans | $ 2,356,641 | $ 2,355,332 | $ 2,138,200 | $ 1,676,928 | $ 1,681,280 | | Yield on total loans | 6.29 % | 6.29 % | 6.08 % | 5.61 % | 5.56 % | | Total Earning Assets | 2,998,405 | 2,969,874 | 2,714,026 | 2,222,823 | 2,225,758 | | Yield on average earning assets | 5.64 % | 5.64 % | 5.45 % | 4.93 % | 4.90 % | | **LIABILITIES** | | | | | | | Total Interest-Bearing Deposits | 1,916,928 | 1,965,483 | 1,762,490 | 1,355,685 | 1,341,365 | | Rate on interest-bearing deposits | 1.42 % | 1.49 % | 1.38 % | 0.96 % | 0.92 % | | Total Borrowings | 325,747 | 299,862 | 296,279 | 278,413 | 293,982 | | Rate on total borrowings | 4.24 % | 4.39 % | 4.39 % | 4.27 % | 4.31 % | | Total Interest-Bearing Liabilities | 2,242,675 | 2,265,345 | 2,058,769 | 1,634,098 | 1,635,347 | | Rate on interest-bearing liabilities | 1.83 % | 1.87 % | 1.81 % | 1.53 % | 1.53 % | | Cost of Funds | 1.45 % | 1.50 % | 1.45 % | 1.19 % | 1.19 % | | FTE Net Interest Margin | 4.27 % | 4.21 % | 4.07 % | 3.81 % | 3.77 % | [Average Balances, Income and Expenses, Yields and Rates (Nine Months)](index=19&type=section&id=Average%20Balances%2C%20Income%20and%20Expenses%2C%20Yields%20and%20Rates%20%28Nine%20Months%29) This table compares average balances, income, expenses, yields, and rates for earning assets and interest-bearing liabilities for the nine months ended September 30, 2025 and 2024, demonstrating YoY growth in earning assets and increased cost of funds **Average Balances, Income and Expenses, Yields and Rates (Nine Months, Dollars in thousands):** | (Dollars in thousands) | Nine months ended September 30, 2025 | Nine months ended September 30, 2024 | | :--------------------- | :----------------------------------- | :----------------------------------- | | **ASSETS** | | | | Total Loans | $ 2,284,141 | $ 1,665,681 | | Yield on total loans | 6.23 % | 5.49 % | | Total Earning Assets | 2,895,093 | 2,221,880 | | Yield on average earning assets | 5.58 % | 4.84 % | | **LIABILITIES** | | | | Total Interest-Bearing Deposits | 1,882,199 | 1,344,565 | | Rate on interest-bearing deposits | 1.43 % | 0.79 % | | Total Borrowings | 307,404 | 294,109 | | Rate on total borrowings | 4.33 % | 4.39 % | | Total Interest-Bearing Liabilities | 2,189,603 | 1,638,674 | | Rate on interest-bearing liabilities | 1.84 % | 1.43 % | | Cost of Funds | 1.47 % | 1.11 % | | FTE Net Interest Margin | 4.19 % | 3.79 % | [Loan and Deposit Detail by Type](index=21&type=section&id=Loan%20and%20Deposit%20Detail%20by%20Type) This table details gross loans and total deposits by type, comparing balances across periods and highlighting changes in categories, with YoY growth largely attributed to the acquisition **Loan and Deposit Detail by Type (Dollars in thousands):** | (Dollars in thousands) | September 30, 2025 | June 30, 2025 | September 30, 2024 | September 2025 vs. June 2025 | September 2025 vs. September 2024 | | :--------------------- | :----------------- | :------------ | :----------------- | :--------------------------- | :-------------------------------- | | **Loans** | | | | | | | Commercial real estate | $ 1,263,896 | $ 1,254,733 | $ 957,904 | $ 9,163 | $ 305,992 | | Residential mortgage | 593,283 | 594,889 | 397,994 | (1,606) | 195,289 | | Commercial and industrial | 218,364 | 226,276 | 152,148 | (7,912) | 66,216 | | Home equity lines of credit | 125,839 | 122,546 | 84,316 | 3,293 | 41,523 | | Real estate construction | 126,451 | 135,023 | 75,953 | (8,572) | 50,498 | | Consumer | 10,144 | 10,253 | 9,773 | (109) | 371 | | Gross loans | 2,337,977 | 2,343,720 | 1,678,088 | (5,743) | 659,889 | | Total loans, net of unearned income | $ 2,336,605 | $ 2,341,816 | $ 1,677,112 | $ (5,211) | $ 659,493 | | **Deposits** | | | | | | | Noninterest-bearing demand deposits | $ 581,697 | $ 568,301 | $ 463,501 | $ 13,396 | $ 118,196 | | Interest-bearing demand deposits | 614,130 | 604,854 | 509,930 | 9,276 | 104,200 | | Money market | 493,430 | 531,738 | 249,197 | (38,308) | 244,233 | | Savings | 330,200 | 339,179 | 311,958 | (8,979) | 18,242 | | Total demand and savings | 2,019,457 | 2,044,072 | 1,534,586 | (24,615) | 484,871 | | Time | 446,439 | 480,469 | 256,731 | (34,030) | 189,708 | | Total deposits | $ 2,465,896 | $ 2,524,541 | $ 1,791,317 | $ (58,645) | $ 674,579 | Non-GAAP Reconciliation This section reconciles non-GAAP financial measures like tangible book value per share, TCE/TA Ratio, and efficiency ratio to GAAP, offering additional insights into financial condition and performance for industry comparisons - **Non-GAAP financial measures** are provided to offer **useful and comparative information** for **assessing trends** in the Corporation's financial condition, **frequently used by analysts and investors**[47](index=47&type=chunk) **Non-GAAP Reconciliation (Dollars in thousands, except per share data):** | (Dollars in thousands, except per share data) | September 30, 2025 | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | | :------------------------------------------ | :----------------- | :------------ | :------------- | :---------------- | :----------------- | | **Tangible book value per share** | | | | | | | Tangible book value per share | $ 30.87 | $ 29.30 | $ 28.23 | $ 29.51 | $ 29.90 | | **Tangible common equity to tangible assets (TCE/TA Ratio)** | | | | | | | Tangible common equity to tangible assets | 10.14 % | 9.65 % | 9.33 % | 10.72 % | 10.74 % | | **Efficiency Ratio** | | | | | | | Efficiency ratio | 51.96 % | 56.21 % | 60.13 % | 63.83 % | 60.56 % |

Company Overview - ACNB is headquartered in Gettysburg and operates in the Finance sector, with a stock price change of 9.26% since the start of the year [3] - The company currently pays a dividend of $0.34 per share, resulting in a dividend yield of 3.13%, which is significantly higher than the Banks - Southwest industry's yield of 1.16% and the S&P 500's yield of 1.51% [3] Dividend Performance - The current annualized dividend of ACNB is $1.36, reflecting a 7.9% increase from the previous year [4] - Over the past 5 years, ACNB has increased its dividend 4 times on a year-over-year basis, averaging an annual increase of 7.02% [4] - The company's current payout ratio is 36%, indicating that it pays out 36% of its trailing 12-month earnings per share as dividends [4] Earnings Growth Expectations - For the fiscal year 2025, the Zacks Consensus Estimate for ACNB's earnings is $4.67 per share, representing a year-over-year growth rate of 25.20% [5] - The company is positioned to provide solid earnings growth, which is crucial for future dividend growth [5] Investment Considerations - ACNB is viewed as a compelling investment opportunity due to its attractive dividend yield and strong Zacks Rank of 2 (Buy) [6] - The company is noted for being a more established player in the market, which is typical for firms that offer dividends, contrasting with tech start-ups that rarely provide dividends [6]

Group 1 - ACNB Corporation is expected to benefit from the acquisition of Traditions Bancorp in the second half of the year [1] - The acquisition has positively impacted the loan balance and net interest margin, which are anticipated to drive growth [1]

Group 1 - Main Street Capital (MAIN) is outperforming its peers in the Finance sector with a year-to-date gain of approximately 13.8%, compared to the sector's average return of 10.6% [4] - The Finance group ranks 2 within the Zacks Sector Rank, indicating strong performance among its 869 companies [2] - MAIN has a Zacks Rank of 2 (Buy), reflecting improving earnings estimates, with a 1.2% increase in the consensus estimate for full-year earnings over the past 90 days [3] Group 2 - Main Street Capital belongs to the Financial - SBIC & Commercial Industry, which has 37 stocks and currently ranks 199 in the Zacks Industry Rank, with this group losing about 5.5% year-to-date [5] - Another Finance stock, ACNB, has also outperformed the sector with a year-to-date increase of 11.9% and has a Zacks Rank of 2 (Buy) [4][5] - The Banks - Southwest industry, which includes ACNB, has 19 stocks and is ranked 31, with a year-to-date increase of 2.1% [6]

[Part I – Financial Information](index=5&type=section&id=Part%20I%20%E2%80%93%20Financial%20Information) [Item 1. Consolidated Financial Statements](index=5&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents ACNB Corporation's unaudited consolidated financial statements, reflecting significant asset, loan, and deposit growth primarily from the Traditions Bancorp acquisition, with Q2 2025 net income at **$11.6 million** and six-month net income at **$11.4 million**, impacted by merger expenses [Consolidated Statements of Condition (Unaudited)](index=5&type=section&id=Consolidated%20Statements%20of%20Condition%20(Unaudited)) Total assets significantly increased to **$3.26 billion** at June 30, 2025, primarily due to the Traditions Bancorp acquisition, driving growth in loans, deposits, and goodwill | (Dollars in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$3,259,528** | **$2,394,830** | | Total Cash and Cash Equivalents | $103,109 | $47,262 | | Loans, net | $2,317,463 | $1,665,630 | | Goodwill | $64,449 | $44,185 | | **Total Liabilities** | **$2,864,377** | **$2,091,557** | | Total Deposits | $2,524,541 | $1,792,501 | | **Total Stockholders' Equity** | **$395,151** | **$303,273** | [Consolidated Statements of Income (Unaudited)](index=6&type=section&id=Consolidated%20Statements%20of%20Income%20(Unaudited)) Net income for Q2 2025 was **$11.6 million**, a slight increase, while six-month net income decreased to **$11.4 million** due to **$10.0 million** in merger expenses and a **$5.7 million** provision for credit losses | (Dollars in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $31,012 | $20,964 | $58,102 | $41,557 | | Provision for credit losses | ($228) | ($2,990) | $5,740 | ($2,767) | | Total Noninterest Income | $8,682 | $6,427 | $15,866 | $12,094 | | Total Noninterest Expenses | $25,366 | $16,391 | $54,701 | $34,053 | | Merger-related Expenses | $1,943 | $23 | $9,974 | $23 | | **Net Income** | **$11,648** | **$11,279** | **$11,376** | **$18,047** | Per Share Data | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | | $1.11 | $1.32 | $1.12 | $2.12 | | $1.11 | $1.32 | $1.12 | $2.12 | [Notes to Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) These notes provide detailed disclosures, highlighting the **Traditions Bancorp acquisition** on February 1, 2025, which significantly impacted financial statements, including investment securities, loans, credit losses, and goodwill - Effective February 1, 2025, ACNB closed the acquisition of Traditions Bancorp, Inc. for **$83.8 million**, issuing **2,035,246 shares** of common stock[18](index=18&type=chunk)[29](index=29&type=chunk) - The acquisition resulted in recording **$20.3 million** in goodwill and **$18.9 million** in core deposit intangibles[32](index=32&type=chunk)[38](index=38&type=chunk) - During Q1 2025, the company changed its accounting policy for loans held for sale to fair value to better reflect mortgage banking activities[22](index=22&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=37&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section analyzes financial performance and condition, highlighting the **Traditions Bancorp acquisition** as the primary driver of balance sheet growth and the **$11.4 million** six-month net income, impacted by credit loss provisions and merger expenses - The acquisition of Traditions Bancorp, effective February 1, 2025, contributed **$877.7 million** in assets, **$648.5 million** in loans, and **$741.5 million** in deposits[119](index=119&type=chunk) - Financial results for the six months ended June 30, 2025, were significantly impacted by a **$4.2 million** (net of taxes) provision for credit losses on non-PCD loans and **$7.8 million** (net of taxes) in merger-related expenses[119](index=119&type=chunk) Performance Ratios (Annualized) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | | 0.74% | 1.49% | | 6.11% | 12.95% | | 4.14% | 3.79% | [Results of Operations](index=40&type=section&id=Results%20of%20Operations) Q2 2025 net income slightly increased to **$11.6 million**, driven by higher net interest income, while six-month net income decreased to **$11.4 million** due to a **$5.7 million** provision for credit losses and **$10.0 million** in merger expenses - Q2 2025 vs Q2 2024: Net interest income increased by **$10.0 million** to **$31.0 million**, with FTE net interest margin expanding by **39 bps** to **4.21%**, including a **$2.2 million** accretion impact[128](index=128&type=chunk) - Six Months 2025 vs 2024: Net interest income increased by **$16.5 million** to **$58.1 million**, with FTE net interest margin expanding by **35 bps** to **4.14%**, including a **$3.7 million** accretion impact[143](index=143&type=chunk) - For the six months ended June 30, 2025, the provision for credit losses was **$5.7 million**, primarily due to establishing a **$5.5 million** allowance for acquired non-PCD loans, contrasting with a **$2.8 million** reversal in 2024[149](index=149&type=chunk)[150](index=150&type=chunk) [Financial Condition](index=49&type=section&id=FINANCIAL%20CONDITION) Total assets reached **$3.26 billion** at June 30, 2025, a significant increase driven by the Traditions acquisition, with loans growing to **$2.34 billion** and deposits to **$2.52 billion**, while capital ratios remained strong | (In thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total loans, net of unearned income | $2,341,816 | $1,682,910 | | Total deposits | $2,524,541 | $1,792,501 | | Total stockholders' equity | $395,151 | $303,273 | - The allowance for credit losses (ACL) increased to **$24.4 million** at June 30, 2025, from **$17.3 million** at year-end 2024, primarily due to an initial ACL of **$5.5 million** for non-PCD loans and **$1.5 million** for accruing PCD loans from the acquisition[166](index=166&type=chunk) - The ratio of uninsured and non-collateralized Bank deposits to total Bank deposits was **20.3%** at June 30, 2025, with available liquidity sources at **297.9%** of these uninsured deposits[171](index=171&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=55&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) ACNB manages interest rate risk through ALCO, with a **100 bps rate decrease** projected to reduce net interest income by **0.7%** and economic value of equity by **4.0%**, remaining within policy limits 12-Month Earnings at Risk (Net Interest Income Sensitivity) | Change in Market Interest Rates (bps) | % Change in NII (June 30, 2025) | Policy Limits | | :--- | :--- | :--- | | (200) | (0.7)% | (10.0)% | | (100) | (0.7)% | (5.0)% | | 100 | 0.3% | (5.0)% | | 200 | (0.2)% | (10.0)% | Value at Risk (Economic Value of Equity Sensitivity) | Change in Market Interest Rates (bps) | % Change in Market Value (June 30, 2025) | Policy Limits | | :--- | :--- | :--- | | (200) | (11.6)% | (35.0)% | | (100) | (4.0)% | (20.0)% | | 100 | (0.1)% | (20.0)% | | 200 | (2.3)% | (35.0)% | [Item 4. Controls and Procedures](index=57&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, ensuring timely and accurate reporting, with no material changes to internal control over financial reporting during Q2 2025 - The Chief Executive Officer and Chief Financial Officer concluded that the Corporation's disclosure controls and procedures are effective as of the end of the period covered by the report[201](index=201&type=chunk) - No material changes were made to the Corporation's internal control over financial reporting during the three months ended June 30, 2025[203](index=203&type=chunk) [Part II – Other Information](index=57&type=section&id=Part%20II%20%E2%80%93%20Other%20Information) [Item 1. Legal Proceedings](index=57&type=section&id=Item%201.%20Legal%20Proceedings) As of June 30, 2025, ACNB Corporation was not party to any material pending legal proceedings, with no expected material adverse effects from routine litigation - There were no material pending legal proceedings, other than ordinary routine litigation, as of June 30, 2025[205](index=205&type=chunk) [Item 1A. Risk Factors](index=58&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors from the 2024 10-K, except for a new risk concerning the adverse impact of changes in trade policies and tariffs on business and asset quality - A new risk factor was added concerning the adverse impact of changes to trade policies and tariffs on the business and its customers, which could negatively affect asset quality and financial performance[206](index=206&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=58&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The Board approved a new plan on June 18, 2025, to repurchase up to **314,000 shares**, superseding prior plans, with **71,592 shares** repurchased during Q2 2025 under the previous plan - On June 18, 2025, the Board of Directors approved a new plan to repurchase up to **314,000 shares** of common stock, replacing all earlier plans[209](index=209&type=chunk) Common Stock Purchases - Q2 2025 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 1 - April 30, 2025 | 68,256 | $39.43 | | May 1 - May 31, 2025 | 760 | $40.99 | | June 1 - June 30, 2025 | 2,576 | $40.95 | | **Total Q2 2025** | **71,592** | | [Item 5. Other Information](index=60&type=section&id=Item%205.%20Other%20Information) No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading agreement during the three months ended June 30, 2025 - No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading agreement during the second quarter of 2025[213](index=213&type=chunk) [Item 6. Exhibits](index=61&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including various agreements, compensation plans, and CEO/CFO certifications - Exhibits filed include CEO and CFO certifications (Exhibits 31.1, 31.2, 32.1, 32.2) and various agreements related to acquisitions, compensation, and debt[214](index=214&type=chunk)[216](index=216&type=chunk)

Core Insights - Acnb reported Q2 2025 GAAP revenue of $39.7 million, exceeding analyst estimates of $38.85 million, but diluted earnings per share (EPS) of $1.11 fell short of the expected $1.15 and declined from $1.32 in the same period last year [1][2][5] Financial Performance - GAAP revenue increased by 44.9% year-over-year from $27.4 million in Q2 2024 to $39.83 million in Q2 2025 [2] - Net interest income rose to $31.0 million, a 47.6% increase from $21.0 million in Q2 2024 [2][5] - Noninterest income grew to $8.7 million, up 35.1% from $6.4 million in Q2 2024 [2][5] - The efficiency ratio improved to 56.21%, down from 58.61% in Q2 2024, indicating better expense management [2][6] Business Overview - Acnb operates a community-focused banking model with 33 offices and a loan center, providing personal and business banking services, along with insurance and wealth management [3] - The recent strategy emphasizes growth through acquisition, particularly the integration of Traditions Bancorp, focusing on cost efficiencies and expanding revenue sources [4] Integration and Costs - The acquisition of Traditions Bancorp contributed an additional $662.2 million in loans and $686.0 million in deposits compared to Q2 2024 [5] - Merger-related costs were reported at $1.9 million, lower than Q1 but still above historical levels, with increased salaries and equipment costs due to new business lines [6] Credit Quality and Capital Position - The allowance for credit losses was $24.4 million, representing 1.04% of total loans, with non-performing loans increasing to $10.1 million, or 0.43% of loans [7] - The capital position remains strong, with a tier 1 leverage ratio of 10.97% and tangible common equity to assets at 9.65% as of June 30, 2025 [7] Shareholder Returns - The company repurchased 71,592 shares and authorized an additional buyback of up to 3.0% of common shares, with a quarterly dividend increase of 6.3% to $0.34 per share [8][9] Future Outlook - Management did not provide specific financial guidance but expressed confidence in capital strength and profitability, highlighting diversified revenue streams as a buffer against economic changes [10][11]

Group 1: Earnings Performance - ACNB reported quarterly earnings of $1.11 per share, missing the Zacks Consensus Estimate of $1.14 per share, and down from $1.32 per share a year ago, representing an earnings surprise of -2.63% [1] - The company posted revenues of $39.69 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 3.96%, compared to year-ago revenues of $27.39 million [2] - Over the last four quarters, ACNB has surpassed consensus revenue estimates four times, but has only exceeded consensus EPS estimates once [2] Group 2: Stock Performance and Outlook - ACNB shares have gained about 8% since the beginning of the year, slightly underperforming the S&P 500's gain of 8.1% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the coming quarter is $1.15 on revenues of $38.96 million, and for the current fiscal year, it is $4.43 on revenues of $149.32 million [7] Group 3: Industry Context - The Zacks Industry Rank indicates that the Banks - Southwest industry is currently in the top 13% of over 250 Zacks industries, suggesting a favorable environment for stock performance [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5] - The favorable estimate revisions trend prior to the earnings release has resulted in a Zacks Rank 2 (Buy) for ACNB, indicating expected outperformance in the near future [6]

Core Insights - ACNB Corporation reported a net income of $11.6 million, or $1.11 diluted earnings per share, for Q2 2025, showing an increase from $11.3 million, or $1.32 diluted earnings per share, in Q2 2024, and a recovery from a net loss of $272 thousand in Q1 2025 [1][9][21] Financial Performance - Net interest income for Q2 2025 was $31.0 million, up $10.0 million from Q2 2024 and $3.9 million from Q1 2025, primarily driven by the acquisition of Traditions Bancorp [6][21] - The fully taxable equivalent (FTE) net interest margin increased to 4.21%, a rise of 39 basis points from Q2 2024 and 14 basis points from Q1 2025 [6][9] - Noninterest income reached $8.7 million, an increase of $2.3 million from Q2 2024 and $1.5 million from Q1 2025, with significant contributions from mortgage loans and insurance commissions [7][21] Asset Quality and Loans - Total loans outstanding were $2.34 billion at June 30, 2025, reflecting an increase of $19.6 million from Q1 2025 and $662.2 million from Q2 2024, with growth across various loan categories attributed to the acquisition [10][21] - The allowance for credit losses was $24.4 million, a decrease of $293 thousand from Q1 2025 and an increase of $7.2 million from Q2 2024 [10][21] - Non-performing loans were $10.1 million, or 0.43% of total loans, stable compared to Q1 2025 but increased from $3.1 million, or 0.19%, in Q2 2024 [11][21] Deposits and Equity - Total deposits were $2.52 billion at June 30, 2025, a decrease of $15.5 million from Q1 2025 but an increase of $686.0 million from Q2 2024 [12][21] - Stockholders' equity rose to $395.2 million, up from $386.9 million in Q1 2025 and $289.3 million in Q2 2024, driven by net income and stock repurchases [14][21] Capital Management - The Board of Directors declared a quarterly cash dividend of $0.34 per share, reflecting a 6.3% increase over the same period in 2024 [9][21] - ACNB repurchased 71,592 shares during Q2 2025 and announced a plan to repurchase up to 314,000 shares, approximately 3.0% of outstanding shares [16][21]

[ACNB Corporation Q2 2025 Financial Results](index=1&type=section&id=ACNB_Corporation_Q2_2025_Financial_Results) [Financial Highlights](index=1&type=section&id=Financial_Highlights) The corporation reported strong Q2 2025 results driven by the Traditions Bancorp acquisition, with significant improvements in key financial metrics Q2 2025 Earnings Summary | Metric | Q2 2025 | Q2 2024 | Q1 2025 | | :--- | :--- | :--- | :--- | | Net Income (Loss) | $11.6 million | $11.3 million | ($272 thousand) | | Diluted EPS (Loss) | $1.11 | $1.32 | ($0.03) | - The financial results for Q1 2025 were significantly impacted by two items related to the Traditions Bancorp acquisition: a **$4.2 million** provision for credit losses (net of taxes) and **$6.2 million** in merger-related expenses (net of taxes)[2](index=2&type=chunk) Q2 2025 Key Performance Indicators | Indicator | Value | Comparison Period | Comparison Value | | :--- | :--- | :--- | :--- | | FTE Net Interest Margin | 4.21% | Q1 2025 | 4.07% | | Return on Average Assets | 1.43% | - | - | | Return on Average Equity | 11.96% | - | - | | Total Loans | $2.34 billion | Q1 2025 | +0.8% | | Tangible Common Equity / Tangible Assets | 9.65% | Q1 2025 | 9.33% | [Management Commentary](index=3&type=section&id=Management_Commentary) Management highlighted strong profitability and successful acquisition integration while focusing on navigating future economic uncertainties - The second quarter of 2025 represents the **first full quarter of combined operations** including Traditions Bank, with the system conversion now complete[7](index=7&type=chunk) - The company is focused on managing through uncertain national economic challenges by **diversifying revenue streams** via ACNB Insurance Services, Wealth Management teams, and Traditions Mortgage[8](index=8&type=chunk) - Due to the acquisition of Traditions Bancorp, financial results for periods ended June 30, 2025, **may not be directly comparable** to prior reported periods[8](index=8&type=chunk) [Capital Management](index=3&type=section&id=Capital_Management) The corporation actively managed capital through a dividend increase and continued share repurchases, approving a new buyback plan - The Board of Directors declared a quarterly cash dividend of **$0.34 per share** for Q2 2025, a $0.02 or **6.3% increase** over the same period in 2024[9](index=9&type=chunk) - ACNB repurchased **71,592 shares** of its common stock in open market transactions during Q2 2025[9](index=9&type=chunk)[22](index=22&type=chunk) - On June 18, 2025, the Board approved a new plan to repurchase up to **314,000 shares**, or approximately 3.0% of outstanding common stock, superseding all earlier plans[9](index=9&type=chunk)[22](index=22&type=chunk) [Financial Performance Analysis](index=4&type=section&id=Financial_Performance_Analysis) Performance was driven by the acquisition, with substantial growth in net interest income and noninterest income offset by higher expenses [Net Interest Income and Margin](index=4&type=section&id=Net_Interest_Income_and_Margin) Net Interest Income and Margin Performance | Metric | Q2 2025 | Change vs Q2 2024 | Change vs Q1 2025 | | :--- | :--- | :--- | :--- | | Net Interest Income | $31.0M | +$10.0M | +$3.9M | | FTE Net Interest Margin | 4.21% | +39 bps | +14 bps | | Yield on Total Loans | 6.29% | +76 bps | +21 bps | | Rate on Interest-Bearing Deposits | 1.49% | +70 bps | +11 bps | - Increases in net interest income and margin were primarily driven by the Traditions acquisition, with an accretion impact of **$2.2 million** in Q2 2025[10](index=10&type=chunk) [Noninterest Income](index=5&type=section&id=Noninterest_Income) Noninterest Income Breakdown (Q2 2025) | Category | Amount | Change vs Q2 2024 | Change vs Q1 2025 | | :--- | :--- | :--- | :--- | | **Total Noninterest Income** | **$8.7M** | **+$2.3M** | **+$1.5M** | | Gain from mortgage loans | $1.6M | +$1.5M | +$720k | | Insurance commissions | $2.9M | +$161k | +$761k | | Service charges on deposits | $1.2M | +$158k | +$85k | - The increase in insurance commissions was driven by the timing of policy renewals, new business, and seasonally stronger contingent commission income[12](index=12&type=chunk) [Noninterest Expense](index=5&type=section&id=Noninterest_Expense) Noninterest Expense Breakdown (Q2 2025) | Category | Amount | Change vs Q2 2024 | Change vs Q1 2025 | | :--- | :--- | :--- | :--- | | **Total Noninterest Expense** | **$25.4M** | **+$9.0M** | **-$4.0M** | | Merger-related expenses | $1.9M | +$1.9M | -$6.1M | | Salaries and employee benefits | $13.7M | +$3.3M | +$832k | - The decrease in noninterest expense from Q1 2025 was primarily due to **lower merger-related expenses**, which were $8.0 million in the prior quarter[13](index=13&type=chunk) - The increase in salaries and benefits was driven by a **larger number of employees** from the acquisition, merit increases, and higher mortgage commissions[13](index=13&type=chunk)[14](index=14&type=chunk) [Balance Sheet and Asset Quality Analysis](index=7&type=section&id=Balance_Sheet_and_Asset_Quality_Analysis) The balance sheet expanded due to the acquisition, showing loan growth and stable asset quality, with stockholders' equity bolstered by net income [Loans and Asset Quality](index=7&type=section&id=Loans_and_Asset_Quality) Loan Portfolio and Asset Quality | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Total Loans | $2.34B | $2.32B | $1.68B | | Allowance for Credit Losses | $24.4M | $24.6M | $17.2M | | Non-performing Loans / Total Loans | 0.43% | 0.43% | 0.19% | | Annualized Net Charge-offs | 0.01% | 0.01% | 0.00% | - The year-over-year increase in loans and non-performing loans was **primarily driven by the Traditions acquisition**[15](index=15&type=chunk)[16](index=16&type=chunk) - The allowance for credit losses decreased slightly from Q1 2025 due to the incorporation of **post-COVID lower credit loss history** in the bank's model[15](index=15&type=chunk) [Deposits and Borrowings](index=7&type=section&id=Deposits_and_Borrowings) Deposits and Borrowings Summary | Metric | June 30, 2025 | Change vs March 31, 2025 | Change vs June 30, 2024 | | :--- | :--- | :--- | :--- | | Total Deposits | $2.52B | -$15.5M | +$686.0M | | Noninterest-bearing Deposits | $568.3M | +$5.6M | +$88.6M | | Total Borrowings | $298.4M | -$1.1M | -$5.9M | - The decrease in total deposits from Q1 2025 was mainly caused by the **withdrawal of a significant 1031 Exchange deposit** from a commercial customer[18](index=18&type=chunk) - To partially offset the large deposit withdrawal, ACNB Bank issued **$20.0 million in brokered time deposits** in June 2025[18](index=18&type=chunk) [Stockholders' Equity](index=8&type=section&id=Stockholders_Equity) Stockholders' Equity and Tangible Book Value | Metric | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Total Stockholders' Equity | $395.2M | $386.9M | $289.3M | | Tangible Book Value per Share | $29.30 | $28.23 | $27.82 | - The increase in equity from Q1 2025 was driven by **net income of $11.6 million**, partially offset by $3.5 million in dividends and $3.1 million in stock repurchases[20](index=20&type=chunk) - The year-over-year increase in equity was primarily due to the **common stock issued for the Traditions acquisition**[20](index=20&type=chunk) [Consolidated Financial Statements](index=13&type=section&id=Consolidated_Financial_Statements) The statements detail the corporation's financial position and performance, reflecting the significant impact of the Traditions acquisition [Selected Financial Data](index=13&type=section&id=Selected_Financial_Data) Selected Financial Data (As of June 30, 2025) | Metric | June 30, 2025 | | :--- | :--- | | Total Assets | $3,259,528 thousand | | Total loans, net | $2,341,816 thousand | | Deposits | $2,524,541 thousand | | Stockholders' equity | $395,151 thousand | Selected Income Statement Data (For Three Months Ended June 30, 2025) | Metric | Amount | | :--- | :--- | | Net interest income | $31,012 thousand | | Noninterest income | $8,682 thousand | | Noninterest expenses | $25,366 thousand | | Net income | $11,648 thousand | [Consolidated Statements of Condition (Balance Sheet)](index=15&type=section&id=Consolidated_Statements_of_Condition_%28Balance_Sheet%29) Assets (As of June 30, 2025 vs June 30, 2024) | Asset Category | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total Cash and Cash Equivalents | $103,109 thousand | $86,274 thousand | | Loans, net | $2,317,463 thousand | $1,662,438 thousand | | Goodwill | $64,449 thousand | $44,185 thousand | | **Total Assets** | **$3,259,528 thousand** | **$2,457,753 thousand** | Liabilities and Stockholders' Equity (As of June 30, 2025 vs June 30, 2024) | Liability/Equity Category | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total Deposits | $2,524,541 thousand | $1,838,588 thousand | | Total Borrowings | $298,395 thousand | $304,286 thousand | | Total Stockholders' Equity | $395,151 thousand | $289,331 thousand | | **Total Liabilities and Stockholders' Equity** | **$3,259,528 thousand** | **$2,457,753 thousand** | [Consolidated Income Statements](index=17&type=section&id=Consolidated_Income_Statements) Income Statement (Three Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net Interest Income | $31,012 thousand | $20,964 thousand | | Total Noninterest Income | $8,682 thousand | $6,427 thousand | | Total Noninterest Expenses | $25,366 thousand | $16,391 thousand | | **Net Income** | **$11,648 thousand** | **$11,279 thousand** | Income Statement (Six Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net Interest Income | $58,102 thousand | $41,557 thousand | | Total Noninterest Income | $15,866 thousand | $12,094 thousand | | Total Noninterest Expenses | $54,701 thousand | $34,053 thousand | | **Net Income** | **$11,376 thousand** | **$18,047 thousand** | [Average Balances, Yields, and Rates](index=19&type=section&id=Average_Balances_Yields_and_Rates) Quarterly FTE Net Interest Margin Analysis (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Yield on Total Earning Assets | 5.64% | 4.89% | | Cost of Interest-Bearing Liabilities | 1.87% | 1.44% | | **FTE Net Interest Margin** | **4.21%** | **3.82%** | Year-to-Date FTE Net Interest Margin Analysis (Six Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Yield on Total Earning Assets | 5.55% | 4.82% | | Cost of Interest-Bearing Liabilities | 1.84% | 1.38% | | **FTE Net Interest Margin** | **4.14%** | **3.79%** | [Non-GAAP Reconciliation](index=23&type=section&id=Non-GAAP_Reconciliation) This section reconciles non-GAAP measures to provide useful comparative information by excluding items like goodwill and merger expenses Tangible Common Equity to Tangible Assets Ratio (TCE/TA) | Period | Ratio | | :--- | :--- | | June 30, 2025 | 9.65% | | March 31, 2025 | 9.33% | | June 30, 2024 | 9.84% | Tangible Book Value Per Share | Period | Value | | :--- | :--- | | June 30, 2025 | $29.30 | | March 31, 2025 | $28.23 | | June 30, 2024 | $27.82 | [About ACNB Corporation](index=9&type=section&id=About_ACNB_Corporation) ACNB Corporation is a $3.26 billion financial holding company operating banking and insurance subsidiaries across Pennsylvania and Maryland - ACNB Corporation is an independent financial holding company with **$3.26 billion in assets**[23](index=23&type=chunk) - The company operates ACNB Bank, which includes Traditions Bank and Traditions Mortgage, and ACNB Insurance Services, Inc[23](index=23&type=chunk) [Safe Harbor and Forward-Looking Statements](index=9&type=section&id=Safe_Harbor_and_Forward-Looking_Statements) This section cautions that future projections are subject to risks and uncertainties, and actual results may differ materially - The press release contains **forward-looking statements** regarding future earnings, plans, and economic assumptions, which are subject to significant risks and uncertainties[24](index=24&type=chunk) - Key risks include **inflation, banking instability, integration of acquisitions**, economic conditions in market areas, and cybersecurity threats[25](index=25&type=chunk)[26](index=26&type=chunk) - The financial information is subject to change pending the filing of the Form 10-Q with the SEC, and readers are cautioned not to place undue reliance on forward-looking statements[26](index=26&type=chunk)