Form 10-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
|
|
|
þ |
|
Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the fiscal year ended December 31, 2009
or
|
|
|
o |
|
Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 |
For the transition period from to
Commission file number 0-12055
Farmers National Banc Corp.
(Exact name of registrant as specified in its charter)
|
|
|
Ohio
|
|
34-1371693 |
|
|
|
(State or other jurisdiction of
|
|
(I.R.S. Employer Identification No.) |
incorporation or organization) |
|
|
|
|
|
20 South Broad Street |
|
|
Canfield, Ohio
|
|
44406 |
|
|
|
(Address of principal executive offices)
|
|
(Zip Code) |
Registrants telephone number, including area code: 330-533-3341
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, no par value
(Title of Class)
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of
the Securities Act.
Yes o No þ
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or
Section 15(d) of the Act.
Yes o No þ
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes þ No o
Indicate by check mark whether the registrant has submitted electronically and posted on its
corporate Web site, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period
that the registrant was required to submit and post such files).
Yes þ No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is
not contained herein, and will not be contained, to the best of registrants knowledge, in
definitive proxy or information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. þ
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the definition of large accelerated
filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
(Check one):
|
|
|
|
|
|
|
Large accelerated filer o
|
|
Accelerated filer þ
|
|
Non-accelerated filer o
|
|
Smaller reporting company o |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act).
Yes o No þ
The registrant estimates that the aggregate market value of the voting stock held by non-affiliates
of the registrant was approximately $82.9 million based upon the last sales price as of June 30,
2009. (The exclusion from such amount of the market value of the shares owned by any person shall
not be deemed an admission by the Registrant that such person is an affiliate of the Registrant.)
As of February 28, 2010, the registrant had outstanding 13,519,605 shares of common stock having no
par value.
DOCUMENTS INCORPORATED BY REFERENCE
|
|
|
|
|
Parts of Form 10-K |
|
|
into which |
Document |
|
Document is Incorporated |
|
|
|
Portions of 2009 Annual Report to Shareholders
|
|
II |
|
|
|
Definitive proxy statement for the 2009 Annual
Meeting of Shareholders to be held on April 13,
2010
|
|
III |
Form 10-K Cross Reference Index to Items Incorporated by Reference to the 2009 Annual Report to
Shareholders
|
|
|
|
|
|
|
Pages |
|
Part I |
|
|
|
|
Item 1 Business |
|
|
|
|
Average Balance Sheets/Yields/Rates |
|
|
12 |
|
Rate and Volume Analysis |
|
|
13 |
|
Securities |
|
|
20-21 |
|
Loans |
|
|
17 |
|
Loan Loss Experience |
|
|
18-20 |
|
Deposits |
|
|
21 |
|
Financial Ratios |
|
|
11 |
|
Short-Term Borrowings |
|
|
21, 38 |
|
|
|
|
|
|
Part II |
|
|
|
|
Item 5
Market For Registrants Common Stock, Number of Holders
of Common Stock and Dividends on Common Stock |
|
|
10 |
|
|
|
|
|
|
Item 6
Selected Financial Data |
|
|
11 |
|
|
|
|
|
|
Item 7
Managements Discussion and Analysis of Financial
Condition and Results of Operations |
|
|
13-22 |
|
|
|
|
|
|
Item 7A
Quantitative and Qualitative Disclosures About Market Risk |
|
|
15-16 |
|
|
|
|
|
|
Item 8
Financial Statements and Supplementary Data |
|
|
25-44 |
|
|
|
|
|
|
Item 9A
Managements Annual Report on Internal Control Over Financial
Reporting |
|
|
23 |
|
|
|
|
|
|
Part IV |
|
|
|
|
Item 15 |
|
|
|
|
Report of Independent Registered Public Accounting Firm |
|
|
24 |
|
Financial Statements: |
|
|
|
|
Consolidated Balance Sheets December 31, 2009 and 2008 |
|
|
25 |
|
Consolidated Statements of Income & Comprehensive
Income Calendar Years 2009, 2008 and 2007 |
|
|
26 |
|
Consolidated Statement of Stockholders Equity
Calendar Years 2009, 2008 and 2007 |
|
|
27 |
|
Consolidated Statements of Cash Flows
Calendar Years 2009, 2008 and 2007 |
|
|
28 |
|
Notes to Consolidated Financial Statements |
|
|
29-44 |
|
FARMERS NATIONAL BANC CORP.
FORM 10-K
2009
INDEX
Part I
Item 1. Business General
The Company
The registrant, Farmers National Banc Corp. (herein sometimes referred to as the Company), is a
one-bank holding company registered under the Bank Holding Company Act of 1956, as amended. The
wholly-owned subsidiaries of Farmers National Banc Corp. are The Farmers National Bank of Canfield
(the Bank), Farmers Trust Company, and Farmers National Insurance. The Corporation was formed in
1983 to acquire the shares of the Bank. The Corporation and its subsidiaries operate in the
domestic banking industry.
Farmers National Banc Corp. conducts no business activities except for investment in securities
permitted under the Bank Holding Company Act. Bank holding companies are permitted under
Regulation Y of the Board of Governors of the Federal Reserve System to engage in other activities
such as leasing and mortgage banking.
The Bank
The Bank is a full-service national bank engaged in commercial and retail banking in Mahoning,
Trumbull and Columbiana Counties in Ohio. The Banks commercial and retail banking services
include checking accounts, savings accounts, time deposit accounts, commercial, mortgage and
installment loans, home equity loans, home equity lines of credit, night depository, safe deposit
boxes, money orders, bank checks, automated teller machines, internet banking, travel cards, E
Bond transactions, utility bill payments, MasterCard and Visa credit cards, brokerage services and
other miscellaneous services normally offered by commercial banks.
A discussion of the general development of the Banks business and information regarding its key
segments throughout 2009, is located within the section Management Discussion and Analysis of
Financial Condition and Results of Operations located on pages 13 through 22 of the Companys
Annual Report.
Please see the Financial Statements and Supplementary Financial Data provided under Item 8 of this
Form 10-K for financial and statistical information regarding the Banks segments, revenue from
external customers, profits, and total assets as of the fiscal year ended December 31, 2009.
The Bank faces significant competition in offering financial services to customers. Ohio has a high
density of financial institution offices, many of which are branches of significantly larger
institutions that have greater financial resources than the Bank, and all of which are competitors
to varying degrees. Competition for loans comes principally from savings banks, savings and loan
associations, commercial banks, mortgage banking companies, credit unions, insurance companies and
other financial service companies. The most direct competition for deposits has historically come
from savings and loan associations, savings banks, commercial banks and credit unions. Additional
competition for deposits comes from non-depository competitors such as the mutual fund industry,
securities and brokerage firms and insurance companies.
Farmers National Banc Corp. has no employees. The Bank had 260 full-time equivalent employees at
December 31, 2009.
Farmers Trust Company
On March 31, 2009, the Company acquired 100% of the capital stock of Butler Wick Trust Company, a
wholly owned subsidiary of Butler Wick Corporation in exchange for $12.125 million. The newly
acquired trust entity operates under the name Farmers Trust Company. With the acquisition, the
Company has added trust services in the areas of estate settlement, living trusts, testamentary
trusts, charitable trusts, charitable endowments and employee benefit plans to complement its core
retail banking and investment
services. The Farmers Trust Company has 30 full-time equivalent employees and operates in two
offices located within the same geographic market as the Bank.
1
Farmers National Insurance
Farmers National Insurance was formed during 2009 and offers insurance products through licensed
representatives. Farmers National Insurance does not account for a material portion of the
Companys revenue and therefore will not be discussed individually, but as part of the Company as a
whole. The entity has 2 full-time employees.
Investor Relations
The Companys internet site, http://www.fnbcanfield.com contains an Investor Relations section
which provides a hyperlink to the SEC where the Companys annual reports on Form 10-K, quarterly
reports on Form 10-Q, current reports on Form 8-K, proxy statements, director and Officer Reports
on Form(s) 3, 4, and 5 and amendments to those documents filed or furnished pursuant to the
Securities Exchange Act of 1934 are available free of charge as soon as reasonably practicable
after the Company has filed these documents with the Securities and Exchange Commission (SEC). In
addition, the Companys filings with the SEC may be read and copied at the SEC Public Reference
Room at 100 F Street, NE, Washington, DC 20549. Information on the operation of the Public
Reference Room may be obtained by calling 1-800-SEC-0330. These filings are also available on the
SECs web-site at http://www.sec.gov free of charge as soon as reasonably practicable after the
Company has filed the above referenced reports.
Supervision and Regulation
The Company is regulated by the Federal Reserve Bank (the FRB). The Bank is regulated by the
Office of the Comptroller of the Currency (the OCC), as well as the Federal Deposit Insurance
Corporation (the FDIC). The Trust Company is licensed and regulated by the Ohio Division of
Financial Institutions. A listing of the minimum regulatory requirements for capital and the
Companys capital position as of December 31, 2009 are presented in Note L on page 40 of the annual
report to shareholders for the year ended December 31, 2009 and is hereby incorporated by
reference.
The Company is subject to regulation under the Bank Holding Company Act of 1956, as amended. This
Act restricts the geographic and product range of bank holding companies by defining the types and
locations of institutions the holding companies can own or acquire. This act also regulates
transactions between the Corporation and the Bank and generally prohibits tie-ins between credit
and other products and services.
The Bank is subject to regulation under the National Banking Act and is periodically examined by
the OCC and is subject to the rules and regulations of the FRB. As an insured institution and
member of the Bank Insurance Fund (BIF), the Bank is also subject to regulation by the FDIC.
Establishment of branches is subject to approval of the OCC and geographic limits established by
state law. Ohio branch banking law permits a bank having its principal place of business in the
state to establish branch offices in any county in Ohio without geographic restrictions.
Federal Home Loan Bank
The Federal Home Loan Banks (FHLB) provide credit to their members in the form of advances.
Farmers National Bank is a member of the FHLB of Cincinnati. As a FHLB member, the Bank must
maintain an investment in the capital stock of the FHLB.
Upon the origination or renewal of a loan or advance, each FHLB is required by law to obtain and
maintain a security interest in certain types of collateral. Each FHLB is required to establish
standards of community investment or service that its members must maintain for continued access to
long-term advances from the FHLB. The standards take into account a members performance under the
Community Reinvestment Act and its record of lending to first-time home buyers.
2
FDICIA
The Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA) revised the bank
regulatory and funding provisions of the Federal Deposit Insurance Act and several other federal
banking statutes. Among other things, FDICIA requires federal banking agencies to broaden the
scope of corrective action taken with respect to banks that do not meet minimum capital
requirements and to take such actions promptly in order to minimize losses to the FDIC.
FDICIA established five capital tiers: well capitalized; adequately capitalized;
undercapitalized; significantly undercapitalized; and critically undercapitalized and imposes
significant restrictions on the operations of a depository institution that is not in either of the
first two of such categories. A depository institutions capital tier depends upon the
relationship of its capital to various capital measures. A depository institution is deemed to be
well capitalized if it significantly exceeds the minimum level required by regulation for each
relevant capital measure, adequately capitalized if it meets each such measure,
undercapitalized if it is significantly below any such measure and critically undercapitalized
if it fails to meet any critical capital level set forth in regulations. An institution is deemed
to be in a capitalization category that is lower than is indicated by its actual capital position
if it receives an unsatisfactory examination rating or is deemed to be in an unsafe or unsound
condition or to be engaging in unsafe or unsound practices.
Under regulations adopted under these provisions, for an institution to be well capitalized it must
have a total risk-based capital ratio of at least 10%, a Tier I risk-based capital ratio of at
least 6% and a Tier I leverage ratio of at least 5% and not be subject to any specific capital
order or directive. For an institution to be adequately capitalized, it must have a total
risk-based capital ratio of at least 8%, a Tier I risk-based capital ratio of at least 4% and a
Tier I leverage ratio of at least 4% (or in some cases 3%). Under the regulations, an institution
is deemed to be undercapitalized if the bank has a total risk-based capital ratio that is less than
8%, a Tier I risk-based capital ratio that is less than 4% or a Tier I leverage ratio of less than
4% (or in some cases 3%). An institution is deemed to be significantly undercapitalized if the
bank has a total risk-based capital ratio that is less than 6%, a Tier I risk-based capital ratio
that is less than 3%, or a leverage ratio that is less than 3% and is deemed to be critically
undercapitalized if it has a ratio of tangible equity to total assets that is equal to or less than
2%.
Interstate Banking and Branching Legislation
The Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 (the IBBEA) authorizes
interstate acquisitions of banks and bank holding companies without geographic constraint. The
IBBEA also authorized banks to merge with banks located in another state.
After acquiring interstate branches through a merger, a bank may establish additional branches in
that state at the same locations as any bank involved in the merger could have established branches
under state and federal law. In addition, a bank may establish a de novo branch in another state
that expressly permits the establishment of such branches. A bank that establishes a de novo
interstate branch may thereafter establish additional branches on the same basis as a bank that has
established interstate branches through a merger transaction.
Patriot Act
The U.S. Patriot Act was signed into law in October 2001 in response to terrorist acts. The
Patriot Act gives the United States Government powers to address terrorist threats through enhanced
domestic security measures, expanded surveillance powers, increased information sharing and
broadened anti-money laundering requirements. Title III of the Patriot Act takes measures intended
to encourage information sharing among bank regulatory agencies and law enforcement bodies. Title
III and related regulations require regulated financial institutions to establish a program
specifying procedures for obtaining identifying information from customers seeking to open new
accounts and establish enhanced due diligence policies, procedures and controls designed to detect
and report suspicious activity. The Bank has established policies and procedures that are believed
to be compliant with the requirements of the Patriot Act.
3
Gramm-Leach-Blily Act
The Gramm-Leach-Bliley Act of 1999 (the GLB Act) allows new opportunities for banks, other
depository institutions, insurance companies and securities firms to combine to form a single
financial services organization to offer customers a broader choice of financial products and
services. The GLB Act authorized the Federal Reserve Board to oversee all regulatory activities
through the financial holding company, while the functional regulation of operating subsidiaries
remains with their primary functional regulator. The GLB Act requires institutions to maintain
Community Reinvestment Act ratings of satisfactory or higher in order to engage in any new
financial activities. This act also established a federal right to privacy of non-public personal
information of individual customers.
Sarbanes-Oxley Act of 2002
The Sarbanes-Oxley Act of 2002 addresses, among other issues, corporate governance, auditing and
accounting, executive compensation, and enhanced and timely disclosure of corporate information.
Section 302(a) of Sarbanes-Oxley requires the Companys chief executive officer and chief financial
officer to certify that the Companys Quarterly and Annual Reports do not contain any untrue
statement of a material fact. The rules have several requirements, including having these officers
certify that: they are responsible for establishing, maintaining and regularly evaluating the
effectiveness of the Companys internal controls; they have made certain disclosures to the
Companys auditors and the audit committee of the Board of Directors about the Companys internal
controls; and they have included information in the Companys Quarterly and Annual Reports about
their evaluation and whether there have been significant changes in the Companys internal controls
or in other factors that could significantly affect internal controls subsequent to the evaluation.
Emergency Economic Stabilization Act of 2008
The Emergency Economic Stabilization Act of 2008 temporarily increased the basic limit on federal
deposit insurance coverage from $100,000 to $250,000. The $250,000 limit is permanent for certain
retirement accounts (including IRAs) and is temporary for all other deposit accounts through
December 31, 2013. On January 1, 2014, the standard insurance amount will return to $100,000 per
depositor for all deposit accounts except certain retirement accounts, which will remain at
$250,000 per depositor.
In addition, the legislation created the Troubled Assets Relief Program (TARP). Under TARP, the
U.S. Treasury established a Capital Purchase Program to provide funding to eligible financial
institutions through the purchase of capital stock for the purpose of stabilizing and providing
liquidity to the capital markets.
Item 1A. Risk Factors
Difficult market conditions and economic trends have adversely affected our industry and our
business.
The capital markets continued to experience difficult conditions through 2009 and into 2010,
producing uncertainty in the financial markets in general and a related general economic downturn.
Dramatic declines in the housing market that resulted in decreasing home prices and increasing
delinquencies and foreclosures negatively impacted the credit performance of mortgage and
construction loans and resulted in significant write-downs of assets by many financial
institutions. In addition, the values of real estate collateral supporting many loans have
declined and may continue to decline. These general downward economic trends, the reduced
availability of commercial credit and increasing unemployment have all negatively impacted the
credit performance of commercial and consumer credit and resulted in additional write-downs.
Concerns over the stability of the financial markets and the economy have resulted in decreased
lending by financial institutions to their customers and to each other. This market turmoil and
tightening of credit has led to increased commercial and consumer deficiencies, lack of customer
confidence, increased market volatility and widespread reduction in general business activity. The
resulting economic pressure on consumers and businesses and the lack of confidence in the financial
markets may adversely affect our business, financial condition, results of operations and stock
price. Also, our ability to assess the creditworthiness of customers and to estimate the losses
inherent in our credit
exposure is made more complex by these difficult market and economic conditions. Business activity
across a wide range of industries and regions is greatly reduced and local governments and many
companies are
in serious difficulty due to the lack of consumer spending and the lack of liquidity in the credit
markets. As of the end of 2009, the United States is in the beginning stages of economic recovery
from the recession. Any worsening of current conditions or slowing of the economic recovery would
have an adverse effect on the Company, our customers and the other financial institutions in our
market. As a result, we may experience increases in foreclosures, delinquencies and customer
bankruptcies.
4
Changes in interest rates could adversely affect income and financial condition.
The Companys income and cash flow depends to a great extent on the difference between the interest
earned on loans and investment securities, and the interest paid on deposits and other borrowings.
An increase in the general level of interest rates may adversely affect the ability of some
borrowers to pay the interest and principal of their loans, especially borrowers with loans that
have adjustable rates of interest. Interest rates are beyond the Companys control, and they
fluctuate in response to general economic conditions and the policies of various governmental and
regulatory agencies, in particular, the Federal Reserve Board. Changes in monetary policy,
including changes in interest rates, will influence the origination of loans, the purchase of
investments, the generation of deposits and the rates received on loans and investment securities
and paid on deposits.
The allowance for loan loss may not be adequate to cover actual future losses.
The Company maintains an allowance for loan losses to cover expected and unexpected future loan
losses. Every loan we make carries a certain risk of non-repayment and we make various assumptions
and judgments about the collectibility of our loan portfolio including the creditworthiness of our
borrowers and the value of the real estate and other assets serving as collateral for the repayment
of loans. Through a periodic review and consideration of the loan portfolio, management determines
the amount of the allowance for loan losses by considering general market conditions, credit
quality of the loan portfolio, the collateral supporting the loans and performance of customers
relative to their financial obligations with us. The amount of future losses is susceptible to
changes in economic, operating and other conditions, including changes in interest rates, which may
be beyond our control, and these losses may exceed current estimates. We cannot fully predict the
amount or timing of losses or whether the loss allowance will be adequate in the future. If our
assumptions prove to be incorrect, our allowance for loan losses may not be sufficient to cover
losses inherent in our loan portfolio, resulting in additions to the allowance. Excessive loan
losses and significant additions to our allowance for loan losses could have a material adverse
impact on our financial condition and results of operations.
Changes in economic and political conditions could adversely affect the Companys earnings.
Our success depends, to a certain extent, upon economic and political conditions, local and
national, as well as governmental monetary policies. Conditions such as inflation, recession,
unemployment, changes in interest rates, money supply and other factors beyond our control may
adversely affect our asset quality, deposit levels and loan demand and, therefore, our earnings.
Because we have a significant amount of real estate loans, additional decreases in real estate
values could adversely affect the value of property used as collateral and our ability to sell the
collateral upon foreclosure. Adverse changes in the economy may also have a negative effect on the
ability of our borrowers to make timely repayments of their loans, which would have an adverse
impact on our earnings. If during a period of reduced real estate values we are required to
liquidate the collateral securing a loan to satisfy the debt or to increase our allowance for loan
losses, it could materially reduce our profitability and adversely affect our financial condition.
The substantial majority of our loans are to individuals and businesses in Ohio. Consequently,
further significant declines in the economy in Ohio could have a materially adverse effect on our
financial condition and results of operations. It is uncertain when the negative credit trends in
our market will reverse and, therefore, future earnings are susceptible to further declining credit
conditions in the market in which we operate.
5
Strong competition within the market the Bank operates could reduce our ability to attract and
retain business.
In our market, we encounter significant competition from banks, savings and loan associations,
credit unions, mortgage banks and other financial service companies. As a result of their size and
ability to achieve economies of scale, some of our competitors offer a broader range of products
and services than we can offer. In particular, the competition includes major financial companies
whose greater resources may afford them a marketplace advantage by enabling them to maintain
numerous banking locations and mount extensive promotional and advertising campaigns. Our ability
to maintain our history of strong financial performance and return on investment to shareholders
will depend in part on our continued ability to compete successfully in our market. Financial
performance and return on investment to shareholders will also depend on its ability to expand its
scope of available financial services to its customers. In addition to other banks, competitors
now include securities dealers, brokers, investment advisors, and finance and insurance companies.
The increasingly competitive environment is, in part, a result of changes in regulation, changes in
technology and product delivery systems, and the accelerating pace of consolidation among financial
service providers.
Consumers may decide not to use banks to complete their financial transactions.
Technology and other changes are allowing parties to utilize alternative methods to complete
financial transactions that historically have involved banks. For example, consumers can now
maintain funds in brokerage accounts or mutual funds that would have historically been held as bank
deposits. Consumers can also complete transactions such as paying bills and/or transferring funds
directly without the assistance of banks. The process of eliminating banks as intermediaries could
result in the loss of fee income, as well as the loss of customer deposits and the related income
generated from those deposits. The loss of these revenue streams and the lower cost deposits as a
source of funds could have a material adverse effect on our financial condition and results of
operations.
Additional required capital may not be available.
We are required by federal regulatory authorities to maintain adequate levels of capital to support
our operations. In addition, we may elect to raise additional capital to support our business or
to finance acquisitions, if any, or we may otherwise elect or be required to raise additional
capital. In that regard, a number of financial institutions have recently raised considerable
amounts of capital in response to a deterioration in their results of operations and financial
condition arising from the turmoil in the mortgage loan market, deteriorating economic conditions,
declines in real estate values and other factors. Our ability to raise additional capital, if
needed, will depend on conditions in the capital markets, economic conditions and a number of other
factors, many of which are outside of our control, and on our financial performance. Accordingly,
there can be no assurance that we can raise additional capital if needed or on terms acceptable to
us. If we cannot raise additional capital when needed, it may have a material adverse effect on
our financial condition, results of operations and prospects.
The preparation of our financial statements requires the use of estimates that may vary from actual
results.
The preparation of consolidated financial statements in conformity with accounting principles
generally accepted in the United States (GAAP) requires management to make significant estimates
that affect the financial statements. One of our most critical estimates is the level of the
allowance for loan losses. Due to the inherent nature of these estimates, we cannot provide
absolute assurance that we will not be required to charge earnings for significant unexpected loan
losses.
We maintain an allowance for loan losses that we believe is a reasonable estimate of known and
inherent losses within the loan portfolio. We make various assumptions and judgments about the
collectibility of our loan portfolio, including the creditworthiness of our borrowers and the value
of the real estate and other assets serving as collateral for the repayment of loans. Through a
periodic review and consideration of the loan portfolio, management determines the amount of the
allowance for loan losses by considering general market conditions, credit quality of the loan
portfolio, the collateral supporting the loans and performance of customers relative to their
financial obligations with us. The amount of future losses
is susceptible to changes in economic, operating and other conditions, including changes in
interest rates,
which may be beyond our control, and these losses may exceed current estimates. We cannot fully
predict the amount or timing of losses. Bank regulators periodically review our allowance for loan
losses and may require us to increase our provision for loan losses or recognize further loan
charge-offs. Any increase in our allowance for loan losses or loan charge-offs as required by
these regulatory authorities might have a material adverse effect on our financial condition and
results of operations.
6
We are exposed to operational risk.
Similar to any large organization, we are exposed to many types of operational risk, including
reputational risk, legal and compliance risk, the risk of fraud or theft by employees or outsiders,
unauthorized transactions by employees or operational errors, including clerical or record-keeping
errors or those resulting from faulty or disabled computer or telecommunications systems.
Negative public opinion can result from our actual or alleged conduct in any number of activities,
including lending practices, corporate governance and acquisitions and from actions taken by
government regulators and community organizations in response to those activities. Negative public
opinion can adversely affect our ability to attract and keep customers and can expose us to
litigation and regulatory action.
Given the volume of transactions we process, certain errors may be repeated or compounded before
they are discovered and successfully rectified. Our necessary dependence upon automated systems to
record and process our transaction volume may further increase the risk that technical system flaws
or employee tampering or manipulation of those systems will result in losses that are difficult to
detect. We may also be subject to disruptions of our operating systems arising from events that
are wholly or partially beyond our control (for example, computer viruses or electrical or
telecommunications outages), which may give rise to disruption of service to customers and to
financial loss of liability. We are further exposed to the risk that our external vendors may be
unable to fulfill their contractual obligations (or will be subject to the same risk of fraud or
operational errors by their respective employees as we are) and to the risk that our (or our
vendors) business continuity and data security systems prove to be inadequate.
Unauthorized disclosure of sensitive or confidential client or customer information, whether
through a breach of our computer systems or otherwise, could severely harm our business.
As part of our financial institution business, we collect, process and retain sensitive and
confidential client and customer information on behalf of our subsidiaries and other third parties.
Despite the security measures we have in place, our facilities and systems, and those of our
third-party service providers, may be vulnerable to security breaches, acts of vandalism, computer
viruses, misplaced or lost data, programming and/or human errors or other similar events. If
information security is breached, information could be lost or misappropriated, resulting in
financial loss or costs to us or damages to others. Any security breach involving the
misappropriation, loss or other unauthorized disclosure of confidential customer information,
whether by us or by our vendors, could severely damage our reputation, expose us to the risks of
litigation and liability or disrupt our operations and have a material adverse effect on our
business.
Legislative or regulatory changes or actions, or significant litigation, could adversely impact us
or the businesses in which we are engaged.
The financial services industry is extensively regulated. We are subject to extensive state
and
federal regulation, supervision and legislation that govern almost all aspects of our operations.
Laws and regulations may change from time to time and are primarily intended for the protection of
consumers, depositors and the deposit insurance funds, and not to benefit our shareholders. The
impact of any changes to laws and regulations or other actions by regulatory agencies may
negatively impact us or our ability to increase the value of our business. Regulatory authorities
have extensive discretion in connection with their supervisory and enforcement activities,
including the imposition of restrictions on the operation of an institution, the classification of
assets by the institution and the adequacy of an institutions allowance for loan losses.
Additionally, actions by regulatory agencies or significant litigation against us could cause us to
devote significant time and resources to defending our business and may lead to penalties that
materially affect us and our shareholders.
7
There can be no assurance that legislative and regulatory initiatives to address economic
conditions will stabilize the United States economy and significantly affect our financial
condition, results of operation, liquidity or stock price.
Governments, regulators and central banks in the United States and worldwide have taken numerous
steps to increase liquidity and to restore investor confidence, but asset values have continued to
decline and access to liquidity continues to be very limited. The U.S. Treasury has authority to
purchase up to $700 billion of mortgages, mortgage-backed securities and certain other financial
instruments from financial institutions and their holding companies, under TARP. The purpose of
TARP is to restore confidence and stability to the United States banking system and to encourage
financial institutions to increase their lending to customers and to each other. The FDIC
increased federal deposit insurance on most deposit accounts from $100,000 to $250,000. This
increase is in place until the end of 2013 and is not covered by deposit insurance premiums paid by
the banking industry. The failure of these significant legislative measures to help stabilize the
financial markets and a continuation or worsening of current financial market conditions could
materially and adversely affect our business, financial condition, results of operations, access to
credit or the trading price of our Stock.
Other actions by the U.S. Government and its agencies include homeowner relief that encourages loan
restructuring and modification; the establishment of significant liquidity and credit facilities
for financial institutions and investment banks; the lowering of the federal funds rate; emergency
action against short selling practices; a temporary guaranty program for money market funds; the
establishment of a commercial paper funding facility to provide back-stop liquidity to commercial
paper issuers; and coordinated international efforts to address illiquidity and other weaknesses in
the banking sector. The purpose of these legislative and regulatory actions is to stabilize the
United States banking system. The regulatory initiatives described above may not have their desired
effects. If the volatility in the markets continues and economic conditions fail to improve or
worsen, our business, financial condition and results of operations could be materially and
adversely affected.
We may be a defendant from time to time in the future in a variety of litigation and other actions,
which could have a material adverse effect on our financial condition and results of operation.
We and our subsidiaries may be involved from time to time in the future in a variety of litigation
arising out of our business. Our insurance may not cover all claims that may be asserted against
us, and any claims asserted against us, regardless of merit or eventual outcome, may harm our
reputation. Should the ultimate judgments or settlements in any litigation exceed our insurance
coverage, they could have a material adverse effect on our financial condition and results of
operation. In addition, we may not be able to obtain appropriate types or levels of insurance in
the future, nor may we be able to obtain adequate replacement policies with acceptable terms, if at
all.
We extend credit to a variety of customers based on internally set standards and judgment. We
manage the credit risk through a program of underwriting standards, the review of certain credit
decisions and an on-going process of assessment of the quality of the credit already extended. Our
credit standards and on-going process of credit assessment might not protect us from significant
credit losses.
We take credit risk by virtue of making loans and leases, extending loan commitments and
letters of credit and, to a lesser degree, purchasing non-governmental securities.
Our exposure to credit risk is managed through the use of consistent underwriting standards
that emphasize in-market lending while avoiding highly leveraged transactions as well as
excessive industry and other concentrations. Our credit administration function employs risk
management techniques to ensure that loans and leases adhere to corporate policy and problem loans
and leases are promptly identified. While these procedures are designed to provide us with the
information needed to implement policy adjustments where necessary, and to take proactive
corrective actions, there can be no assurance that such measures will be effective in avoiding
undue credit risk.
8
Future FDIC premiums could be substantially higher and would have an unfavorable effect on
earnings.
The FDIC projects higher premiums to be necessary because the financial institution failures
resulting from the depressed market conditions have depleted and may continue to deplete the
deposit insurance fund and reduce its ratio of reserves to insured deposits. The FDIC in an effort
to avoid larger increases in the premiums has already taken action to collect FDIC premiums for the
next three years in advance. If any additional assessments or large premium increases occur in the
future they would negatively affect our financial condition and results of operation.
We depend on our subsidiaries for dividends, distributions and other payments.
As a bank holding company, we are a legal entity separate and distinct from our subsidiaries. Our
principal source of funds to pay dividends on our Common Shares is dividends from these
subsidiaries. In the event our subsidiaries become unable to pay dividends to us, we may not be
able to pay dividends on our Common Shares of outstanding stock. Accordingly, our inability to
receive dividends from our subsidiaries could also have a material adverse effect on our business,
financial condition and results of operations.
Federal and state statutory provisions and regulations limit the amount of dividends that our
banking and other subsidiaries may pay to us without regulatory approval. Our banking subsidiaries
generally may not, without prior regulatory approval, pay a dividend in an amount greater than
their undivided profits. In addition, the prior approval of the OCC is required for the payment of
a dividend by Farmers National Bank if the total of all dividends declared in a calendar year would
exceed the total of its net income for the year combined with its retained net income for the two
preceding years. The Federal Reserve Board and the OCC have issued policy statements that provide
that insured banks and bank holding companies should generally only pay dividends out of current
operating earnings. The ability of Farmers National Bank to pay dividends in the future is
currently influenced, and could be further influenced, by bank regulatory policies and capital
guidelines and may restrict our ability to declare and pay dividends.
Defaults by another larger financial institution could adversely affect financial markets
generally.
The commercial soundness of many financial institutions may be closely interrelated as a result of
relationships between the institutions. As a result, concerns about, or a default or threatened
default by, one institution could lead to significant market-wide liquidity and credit problems,
losses or defaults by other institutions. This is sometimes referred to as systemic risk and may
adversely affect our business.
Item 1B. Unresolved Staff Comments
There are no matters of unresolved staff comments from the Commission staff.
Item 2. Properties
Farmers National Banc Corp.s Properties
The Farmers National Banc Corp. owns no property. Operations are conducted at 20 and 30 South
Broad Street, Canfield, Ohio.
9
Bank Property
The Main Office is located at 20 & 30 S. Broad Street, Canfield, Ohio. The other locations of the
Bank are:
|
|
|
Office Building
|
|
40 & 46 S. Broad St., Canfield, Ohio |
|
|
|
Austintown Office
|
|
22 N. Niles-Canfield Rd., Youngstown, Ohio |
|
|
|
Lake Milton Office
|
|
17817 Mahoning Avenue, Lake Milton, Ohio |
|
|
|
Cornersburg Office
|
|
3619 S. Meridian Rd., Youngstown, Ohio |
|
|
|
Colonial Plaza Office
|
|
401 E. Main St. Canfield, Ohio |
|
|
|
Western Reserve Office
|
|
102 W. Western Reserve Rd., Youngstown, Ohio |
|
|
|
Salem Office
|
|
1858 E. State Street, Salem, Ohio |
|
|
|
Columbiana Office
|
|
340 State Rt. 14, Columbiana, Ohio |
|
|
|
Leetonia Office
|
|
16 Walnut St., Leetonia, Ohio |
|
|
|
Damascus Office
|
|
29053 State Rt. 62 Damascus, Ohio |
|
|
|
Poland Office
|
|
106 McKinley Way West, Poland, Ohio |
|
|
|
Niles Office
|
|
1 South Main Street, Niles, Ohio |
|
|
|
Niles Drive Up
|
|
170 East State Street, Niles, Ohio |
|
|
|
Girard Office
|
|
121 North State Street, Girard, Ohio |
|
|
|
Eastwood Office
|
|
5845 Youngstown-Warren Rd, Niles, Ohio |
|
|
|
Warren Office
|
|
2910 Youngstown-Warren Rd, Warren, Ohio |
|
|
|
Mineral Ridge Office
|
|
3826 South Main Street, Mineral Ridge, Ohio |
|
|
|
Niles Operation Center
|
|
51 South Main Street, Niles, Ohio |
The Bank owns all locations except the Colonial Plaza, which is leased.
Trust Property
Farmers Trust Company operates from two leased locations:
|
|
|
Youngstown Office
|
|
City Centre One, Suite 800, Youngstown, OH |
|
|
|
Howland Office
|
|
Harvard Commons, 1695 Niles-Cortland Rd., Warren,
Ohio |
Insurance Property
Farmers National Insurance operates from one location which is owned by the Bank:
|
|
|
Western Reserve Office
|
|
102 W. Western Reserve Rd., Youngstown, Ohio |
Item 3. Legal Proceedings
In the opinion of management there are no outstanding legal actions that will have a material
adverse effect on the Companys financial condition or results of operations.
10
Part II
Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuers
Purchases of Equity Securities
Purchases of equity securities by the issuer.
On July 14, 2009, The Company announced the adoption of a stock repurchase program that authorizes
the re-purchase of up to 4.9% or approximately 657 thousand shares of its outstanding common stock
in the open market or in privately negotiated transactions. This program expires in July 2010.
There was no treasury stock purchased by the Company during the fourth quarter of 2009.
Item 6. Selected Financial Data
Information required by this section is incorporated by reference to the information appearing
under the caption Selected Financial Data located on page 11 of the Companys Annual Report and
is explained in the section Management Discussion and Analysis of Financial Condition and Results
of Operations located on pages 13 through 22 of the Companys Annual Report.
Item 7. Managements Discussion and Analysis of Financial Condition
Information required by this section is incorporated by reference to the information appearing
under the caption Management Discussion and Analysis of Financial Condition and Results of
Operation located on pages 13 through 22 of the Companys Annual Report.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Information required by this section is incorporated by reference to the information appearing
under the caption Market Risk located on pages 15 through 16 of the Companys Annual Report.
Item 8. Financial Statements and Supplementary Financial Data
Information required by this section is incorporated by reference to the information located on
pages 25 to 44 of the Companys Annual Report.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure
During the fiscal years ended December 31, 2009 and December 31, 2008, there were no disagreements
between the Company and Crowe Horwath LLP on any matter of accounting principles or practices,
financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved
to Crowe Horwaths satisfaction, would have caused Crowe Horwath to make reference to the subject
matter of the disagreement in connection with its reports on the Companys consolidated financial
statements for such periods.
11
Item 9A. Controls and Procedures
Managements Annual Report on Internal Control over Financial Reporting
As of the end of the period covered by this report, the Company carried out an evaluation, under
the supervision and with the participation of the Companys management, including the Companys
Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and
operation
of the Companys disclosure controls and procedures. Based on that evaluation, the Companys Chief
Executive Officer and Chief Financial Officer concluded that the Companys disclosure controls and
procedures were effective to ensure that the financial and nonfinancial information required to be
disclosed by the Company in the reports that it files or submits under the
Securities Exchange Act of 1934, including this annual report on Form 10-K for the period ended
December 31, 2009, is recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commissions rules and forms.
Managements responsibilities related to establishing and maintaining effective disclosure controls
and procedures include maintaining effective internal controls over financial reporting that are
designed to produce reliable financial statements in accordance with accounting principles
generally accepted in the United States. As disclosed in the Report on Managements Assessment of
Internal Control Over Financial Reporting in our 2009 Annual Report to Shareholders, management
assessed the Companys system of internal control over financial reporting as of December 31, 2009,
in relation to criteria for effective internal control over financial reporting as described in
Internal Control Integrated Framework, issued by the Committee of Sponsoring Organizations of
the Treadway Commission and found it to be effective.
Crowe Horwath LLP, the Companys registered public accounting firm, has audited the Companys
internal control over financial reporting as of December 31, 2009. The audit report by Crowe
Horwath is located on page 24 of our 2009 Annual Report to Shareholders.
Changes in Internal Control over Financial Reporting
There were no changes in the Companys internal controls over financial reporting (as defined in
Rule 13a 15(f) under the Exchange Act) that occurred during the year ended December 31, 2009,
that have materially affected, or are reasonably likely to materially affect, the Companys
internal control over financial reporting. There have been no significant changes in the Companys
internal controls or in other factors that could significantly affect internal controls subsequent
to the date of their evaluation or material weaknesses in such internal controls requiring
corrective actions
Item 9B. Other Information
None
PART III
Item 10. Directors, Executive Officers and Corporate Governance
Information relating to Directors and Corporate Governance is set forth in the registrants
definitive proxy statement, which will be used in connection with its annual meeting of
shareholders which will be held April 13, 2010. The proxy statement is incorporated by reference.
Executive Officers of the Registrant
The names, ages and positions of the executive officers as of March 1, 2010
|
|
|
|
|
|
|
Name |
|
Age |
|
Position Held |
|
|
|
|
|
|
|
Frank L. Paden
|
|
|
59 |
|
|
President and Secretary |
John S. Gulas
|
|
|
51 |
|
|
Executive Vice President and Chief Operating Officer |
Carl D. Culp
|
|
|
46 |
|
|
Executive Vice President & Treasurer |
Officers are elected annually by the Board of Directors immediately following the annual meeting of
shareholders. The term of office for all the above executive officers is for the period ending
with the next annual meeting.
12
Principal Occupation and Business Experience of Executive Office
Mr. Frank L. Paden has served as President and Secretary since March 1996. Prior to that time he
was Executive Vice President of the registrant since March 1995, was Executive Vice President of
the Bank since March 1995 and has held various other executive positions with the Bank.
Mr. John S. Gulas has served as Chief Operating Officer since January 2009. In addition to his
election as Chief Operating Officer of the registrant Mr. Gulas has served in the same capacity
with the Bank since July 2008. Prior to that time Mr. Gulas was the President and CEO of Sky Trust
Company, N.A. since July 2005. Prior to that position he was Executive Vice President and Chief
Fiduciary Officer for UMB Bank in Kansas City, MO.
Mr. Carl D. Culp has served as Executive Vice President and Treasurer since March 1996. Prior to
that time he was Controller of the registrant since November 1995 and was Controller of the Bank
since November 1995.
Compliance with Section 16(a) of the Securities Exchange Act
Information regarding this item is set forth in the Companys definitive proxy statement, which
will be used in connection with its annual meeting of shareholders to be held April 13, 2010. The
proxy statement is incorporated by reference.
Code of Ethics
See Exhibit 14.
Nominating Committee
Information regarding this item is set forth in the Companys definitive proxy statement, which
will be used in connection with its annual meeting of shareholders to be held April 13, 2010. The
proxy statement is incorporated by reference.
Identification of the Audit Committee
Information regarding this item is set forth in the Companys definitive proxy statement, which
will be used in connection with its annual meeting of shareholders to be held April 13, 2010. The
proxy statement is incorporated by reference.
Audit Committee Financial Expert
The Board believes that Earl R. Scott and James R. Fisher qualify as Audit Committee Financial
Experts as that term is defined by applicable SEC rules. In addition, the Board believes that
Earl R. Scott and James R. Fisher are independent as that term is defined by applicable SEC
rules.
Item 10. Executive Compensation
Information regarding this item is set forth in the Companys definitive proxy statement, which
will be used in connection with its annual meeting of shareholders to be held April 13, 2010. The
proxy statement is incorporated by reference.
13
Item 11. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
Securities Authorized for Issuance Under Equity Compensation Plans
Equity Compensation Plan Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of securities |
|
|
|
Number of securities |
|
|
Weighted-average |
|
|
remaining available for |
|
|
|
to be issued upon |
|
|
exercise price of |
|
|
future issuance under |
|
|
|
exercise of out |
|
|
outstanding |
|
|
equity compensation |
|
|
|
standing options, |
|
|
options, warrants |
|
|
plans (excluding |
|
|
|
warrants and rights |
|
|
and rights |
|
|
securities reflected in column (a)) |
|
Plan category |
|
(a) |
|
|
(b) |
|
|
(c) |
|
Equity compensation
plans approved by
security holders |
|
|
37,000 |
|
|
$10.40/share |
|
|
0 |
|
Information regarding the equity (stock-based) compensation plan is set forth in the registrants
annual report in Notes A and K in the Notes to Consolidated Financial Statements. This portion of
the annual report is incorporated by reference.
Security Ownership of Management
Information relating to this item is set forth in the Companys definitive proxy statement, which
will be used in connection with its annual meeting of shareholders to be held April 13, 2010. The
proxy statement is incorporated by reference.
Item 12. Certain Relationships and Related Transactions and Director Independence
Information regarding this item is set forth in the Companys definitive proxy statement, which
will be used in connection with its annual meeting of shareholders to be held April 13, 2010. The
proxy statement is incorporated by reference.
Item 13. Principal Accountant Fees and Services
Information regarding this item is set forth in the Companys definitive proxy statement, which
will be used in connection with its annual meeting of shareholders to be held April 13, 2010. The
proxy statement is incorporated by reference.
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a)1. Financial Statements
Item 8., Financial Statements and Supplementary Data is set forth
in the Companys 2009 Annual Report to Shareholders and
is incorporated by reference in Part II of this report.
2. Financial Statement Schedules
No financial statement schedules are presented because they are not applicable.
14
3. Exhibits
The exhibits filed or incorporated by reference as a part of this report are
listed in the Index of Exhibits, which appears at page 17 hereof and is
incorporated herein by reference. No financial statement schedules are
presented because they are not applicable.
(b) Exhibits
The exhibits filed or incorporated by reference as a part of this report are
listed in the Index of Exhibits, which appears at page 17 hereof and is
incorporated herein by reference.
(c) Financial Statement Schedules
No financial statement schedules are presented under this section because
none are applicable.
15
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the under signed, thereunto duly
authorized.
|
|
|
|
|
Farmers National Banc Corp. |
|
Farmers National Banc Corp. |
|
Farmers National Banc Corp |
|
|
|
|
|
/s/ Frank L. Paden
|
|
/s/ Carl D. Culp
|
|
/s/ Joseph W. Sabat |
|
|
|
|
|
Frank L. Paden
|
|
Carl D. Culp
|
|
Joseph W. Sabat |
President and Secretary
|
|
Executive VP and Treasurer
|
|
Controller |
March 16, 2010
|
|
March 16, 2010
|
|
March 16, 2010 |
|
|
|
|
|
|
|
Director
|
|
March 16, 2010 |
Benjamin R. Brown |
|
|
|
|
|
|
|
|
|
/s/ Anne Frederick Crawford
|
|
Director
|
|
March 16, 2010 |
Anne Frederick Crawford |
|
|
|
|
|
|
|
|
|
|
|
Director
|
|
March 16, 2010 |
James R. Fisher |
|
|
|
|
|
|
|
|
|
|
|
Director
|
|
March 16, 2010 |
Joseph D. Lane |
|
|
|
|
|
|
|
|
|
|
|
Director
|
|
March 16, 2010 |
Ralph D. Macali |
|
|
|
|
|
|
|
|
|
|
|
Director
|
|
March 16, 2010 |
Earl R. Scott |
|
|
|
|
|
|
|
|
|
|
|
President and Director
|
|
March 16, 2010 |
Frank L. Paden |
|
|
|
|
|
|
|
|
|
|
|
Director
|
|
March 16, 2010 |
Ronald V. Wertz |
|
|
|
|
16
INDEX TO EXHIBITS
The following exhibits are filed or incorporated by reference as part of this report:
|
|
|
|
|
|
2. |
|
|
Not applicable. |
|
|
|
|
|
|
3(i). |
|
|
The Articles of Incorporation, including amendments thereto for the Corporation.
Incorporated by reference to Exhibit 4.1 to Farmers National Banc Corps Form S-3
Registration Statement dated October 3, 2001 (File No. 0-12055). |
|
|
|
|
|
3(ii).
|
|
The Code of Regulations, including amendments thereto for the Corporation.
|
|
|
|
|
|
|
4. |
|
|
Incorporated by reference to initial filing. |
|
|
|
|
|
|
9. |
|
|
Not applicable. |
|
|
|
|
|
|
10.1 |
|
|
Information regarding this item is set forth in the Companys definitive proxy statement,
which will be used in connection with its annual meeting of shareholders to be held
April 13, 2010. The proxy statement is incorporated by reference. |
|
|
|
|
|
|
10.2 |
|
|
Executive Incentive Plan, dated August 11, 2009, adopted by the board of directors of the
Farmers National Banc Corp, (Incorporated herein by reference to Exhibit 10.2 to the Banks
August 17, 2009 Form 8-K). |
|
|
|
|
|
|
10.3 |
|
|
Letter Agreement, dated July 22, 2008, between Farmers National Bank of Canfield, and John
S. Gulas (Incorporated herein by reference to Exhibit 10.3 to the Banks July
22, 2008 Form 8-K). |
|
|
|
|
|
|
10.4 |
|
|
Letter Agreement, dated December 23, 2008, between Farmers National Bank of Canfield, and
Kevin J. Helmick (Incorporated herein by reference to Exhibit 10.4 to the Banks December 23,
2008 Form 8-K). |
|
|
|
|
|
|
10.5 |
|
|
Letter Agreement, dated December 23, 2008, between Farmers National Bank of Canfield, and
Mark L. Graham (Incorporated herein by reference to Exhibit 10.5 to the Banks December 23, 2008
Form 8-K). |
|
|
|
|
|
|
10.6 |
|
|
Letter Agreement, dated December 23, 2008, between Farmers National Bank of Canfield, and
Frank L. Paden (Incorporated herein by reference to Exhibit 10.6 to the Banks December 23, 2008
Form 8-K). |
|
|
|
|
|
|
10.7 |
|
|
Letter Agreement, dated December 23, 2008, between Farmers National Bank of Canfield, and
Carl D. Culp (Incorporated herein by reference to Exhibit 10.7 to the Banks December 23, 2008
Form 8-K). |
|
|
|
|
|
|
10.8 |
|
|
Certified Resolution regarding Adoption of Farmers National Banc Corp 1999 Stock Option
Plan, (Incorporated herein by reference to Exhibit 10.8 to Farmers National Banc Corps Proxy
dated February 24, 1999). |
|
|
|
|
|
|
11. |
|
|
Refer to Note P in the annual report incorporated by reference. |
|
|
|
|
|
|
12. |
|
|
Not applicable. |
|
|
|
|
|
|
13. |
|
|
Annual Report to security holders. |
|
|
|
|
|
|
14. |
|
|
The Company has adopted a Code of Ethics that applies to the Chief Executive Officer and
Chief Financial Officer and complies with the criteria provided in SEC rules. The Code of
Ethics is available, free of charge, by calling the Banks Corporate Services at
330-533-3341. |
17
|
|
|
|
|
|
16. |
|
|
Not applicable. |
|
|
|
|
|
|
18. |
|
|
Not applicable. |
|
|
|
|
|
|
21. |
|
|
Farmers National Bank, an Ohio corporation, Canfield, Ohio.
Farmers Trust Company, an Ohio corporation, Youngstown, Ohio
Farmers National Insurance, an Ohio Limited Liability Company, Canfield, Ohio |
|
|
|
|
|
|
22. |
|
|
Not applicable. |
|
|
|
|
|
|
23a. |
|
|
Consent of Crowe Horwath LLP |
|
|
|
|
|
|
24. |
|
|
Not applicable. |
|
|
|
|
|
|
31.a |
|
|
Certification of Chief Executive Officer (Filed herewith) |
|
|
|
|
|
|
31.b |
|
|
Certification of Chief Financial Officer (Filed herewith) |
|
|
|
|
|
|
32.a |
|
|
1350 Certification of Chief Executive Officer (Filed herewith) |
|
|
|
|
|
|
32.b |
|
|
1350 Certification of Chief Financial Officer (Filed herewith) |
|
|
|
|
|
|
33. |
|
|
Not applicable |
|
|
|
|
|
|
34. |
|
|
Not applicable |
|
|
|
|
|
|
35. |
|
|
Not applicable |
Copies of any exhibits will be furnished to shareholders upon written request. Request should be
directed to Carl D. Culp, Executive Vice President, Farmers National Banc Corp., 20 S. Broad
Street, Canfield, Ohio 44406.
18