Farmers bank reports lower earnings

By Don Shilling

CANFIELD — The parent company of Farmers National Bank reported lower earnings after taking a large accounting charge for an investment loss.

Farmers National Banc Corp. earned $999,000 in the third quarter, compared with $1.6 million in the same quarter last year.

Last quarter’s earnings included a $1.2 million charge to cover the loss in value of the company’s preferred stock in Fannie Mae. The market value of the bank’s stock was $242,000 on Oct. 24.

Banks have been writing down the value of their investments after Fannie Mae and Freddie Mac ran into financial troubles. The two companies buy mortgages on the secondary market and were left with loan losses because of the subprime mortgage crisis.

So far this year, Farmers has written off $1.6 million in its investments in Fannie Mae.

Without the charge in the third quarter, Farmers would have earned $2.2 million.

Despite reduced earnings, Frank Paden, Farmers president and chief executive, said he was pleased with improvements in key areas such as loan and deposit growth.

The company held loans of $524.5 million on September 30, up $15.7 million from a year earlier.

In the same period, deposits increased $63 million to $649.9 million.

Nonperforming loans — those that haven’t received a payment for 90 days or more — totaled $3.1 million Sept. 30. That was up from $2.9 million a year earlier. The nonperforming loans are in both residential and commercial real estate.

Farmers operates 16 branches in the Mahoning Valley.