Banking & Finance

Helmick Radiates Confidence about Farmers’ Outlook

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CANFIELD, Ohio – The president and CEO of Farmers National Banc Corp. sees a future so bright that he and his senior management might have to wear sunglasses even at night.

At its annual meeting Thursday, Kevin J. Helmick presented the community bank, its wealth management division, and trust company as bathed in sunlight and reflecting a healthy glow.

“2014 was another strong financial year,” Helmick reported. “We had lofty goals and achieved many of them.”

Updating shareholders on the progress of the acquisition of National Bancshares Corp., parent of First National Bank of Orrville, Helmick said the $74 million purchase remains on schedule. The shareholders’ special meeting to vote on the matter should be held in mid-June with the agreement closing late in the second quarter.

The shareholders seemed to be pleased with Farmers’ performance as they cast more than 95% of their 14.7 million votes for the three directors up for re-election and 92% for the advisory vote on executive compensation. Nearly 80% of the 18.4 million shares were voted.

Reelected were the nonexecutive chairman, Lance J. Ciroli, and Anne Frederick Crawford and David Z. Pauli.

Farmers National Bank, the Farmers Trust Co. and the holding company’s wealth management division turned in solid performances in 2014. Carl D. Culp, executive vice president and chief financial officer, reviewed the financial highlights: Farmers Bank “is in a strong capital position [with a ratio of] 10.2% tangible common equity that allows us to continue to grow,” he said.

Farmers ended 2014 with $1.14 billion in assets, just about the same as year-end 2013, total deposits of $915.7 million, up slightly from 2013, and net loans of $656.2 million, up from $623.1 million a year earlier. Culp noted that 91% of the deposits are core deposits, a factor that adds stability to the bank.

The composition of those figure reflect a healthy and stronger financial institution, Culp continued.

Net income per share rose 17.07%. Noninterest (fee) income rose 9.98%. Noninterest expense (salaries, benefits, marketing, rents, data processing, Federal Deposit Insurance Corp. premiums) dropped 2.29%. The efficiency ratio fell to 70.24% from 74.82%. The loan portfolio grew 5.26% to $631 million. And the ratio of nonperforming assets to total assets fell by 6.17%.

The wealth management division has improved how Farmers records its profits. “It was a record year for wealth management,” Culp said. “Where in 2009, it contributed 14.5% of total income, in 2014 it was 28.8%, nearly double. We’ve had a 25% annual growth rate over the last seven years” and assets under management grew apace. Assets managed by Farmers Trust Co. exceed $1.1 billion.

In discussing the acquisition of National Bancshares Corp., Helmick praised at length its president and CEO, Mark Witmer, for the growth and strong performance of First National. Witmer will remain and join Farmers as senior executive vice president.

First National Bank of Orrville, which has 14 branches, will be integrated into Farmers Bank and its signage become Farmers National Bank, as announced last January. There is minimal geographic overlap between the two, only in Salem is there a Farmers office and First National office, “both performing very well,” Helmick said. No decision on whether to keep both open or close one will be made until after the agreement is executed, he said.

The directors and senior management of both financial institutions continue to like what they see in the other, Helmick said, and the similarity of corporate cultures bodes well for integration and service to customers as well as enhancing shareholder value.

Farmers’ expansion west continues as its entry into Canton, Fairlawn and Alliance has gone well, Helmick said, and its offices closer to home likewise in Howland and in Boardman on McClurg Road.

Pictured: Kevin Helmick, president and CEO of Farmers National Banc Corp.

Published by The Business Journal, Youngstown, Ohio.