8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 30, 2007

CNB Financial Corp.

(Exact name of registrant as specified in its charter)

Massachusetts	0-51685	20-3801620
(State or other jurisdiction of	(Commission	(IRS Employer
incorporation or organization)	File Number)	Identification No.)

33 Waldo Street, PO Box 830, Worcester, MA 01613-0830

 (Address of principal executive offices) (Zip Code)

 (508) 752-4800

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ]         Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[  ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 8.01                      Other Events.

On August 30, 2007, CNB Financial Corp. (the “Company”), the holding company for Commonwealth National Bank, disseminated a letter to shareholders that reported: (1) the Company’s results of operations and financial condition for the three and six months ended June 30, 2007; (2) the formation of a new advisory board; (3) the development of a remote capture product; and (4) the engagement of new independent accounting firm. The information relating to the Company’s results of operations and financial condition was previously disclosed in its Quarterly Report on Form 10-Q for the quarter ended June 30, 2007.

A copy of the letter to shareholders is attached as Exhibit 99.1 and incorporated herein by reference.

Item 9.01                      Financial Statements and Exhibits.

(a)   Financial Statements of Businesses Acquired:  Not applicable

(b)   Pro Forma Financial Information:  Not applicable

(c)   Shell Company Transactions:  Not applicable

(d)   Exhibits

Number	Description
99.1	Letter to Shareholders

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

	CNB Financial Corp.
Date: August 30, 2007	By: /s/ William M. Mahoney
	William M. Mahoney
	Treasurer and Chief Financial Officer

EX-99.1

Exhibit 99.1

Dear CNB Financial Corp. Shareholder:

During the second quarter of 2007, CNB Financial Corp. developed new products and services to better meet the needs of customers, completed the formation of a new advisory board, focused on initiatives to address the challenges of the interest rate environment and registered significant growth in loans, deposits and total assets.

Total assets grew to $292.5 million on June 30, 2007, 4% higher than the $281.4 million level at December 31, 2006.  This growth was driven by a 7% increase in total loans which reached $214.5 million on June 30, 2007.

Total deposits have grown by 8% since December 31, 2006, reaching a level of $207.3 million on June 30, 2007.  The growth in deposits was fueled by the introduction of the Commonwealth Choice Account in early April of this year.  This account is a high-interest rate savings account for personal banking and commercial customers and has helped us meet the challenges of the current interest rate environment by reducing high cost deposit balances and increasing the balances of lower cost deposits. We will continue to explore new products and services that will help us stay competitive, reduce our relative interest costs and bring in new business during these market conditions.  We are happy to report that the two new branches opened during 2006 are contributing significantly to our overall deposit growth and personalized customer service.

Strategies adopted during the quarter, including the introduction of the Commonwealth Choice Account mentioned above, acted to mitigate the effect of the difficult interest rate environment as evidenced by the net interest margin which declined by merely one basis point to 3.03% compared to the 3.04% registered during the first quarter of 2007.  The resulting net interest income equaled $2.1 million for the quarter, which increased slightly from the prior quarter. For the first six months of the year, net interest income equaled $4.1 million, compared to the $4.3 million amount recorded during the same period of 2006.

Operating expenses (alternatively known as non-interest expense) equaled $2.1 million in the second quarter of 2007, an increase of 9% as compared to the same period of 2006.  On a year to date basis, operating expenses have increased 10% since 2006.  The increases are primarily attributable to the opening of two new branches during the latter part of 2006, expansion of the operations department facility and increased FDIC deposit insurance premium costs.

Net income equaled $81,000 and $140,000 for the three and six-month period ending June 30, 2007, respectively, compared to $129,000 and $346,000 for the same periods of 2006.  Net income per basic and diluted share for the quarter ended June 30, 2007 totaled $.04 compared to $.06 for the same period of 2006.  On a year-to-date basis, net income per basic and diluted share totaled $.06 compared to $.16 for the same period of last year.

One initiative under development is our new Remote Deposit Capture (RDC) product, which we are preparing to launch next month. This product will help us expand our geographic territory without the expense of physical branches as well as offer significant convenience to our clients, allowing them to make same-day deposits without having to travel to a branch.

During the quarter we also completed the formation of our new advisory board. Comprised of almost fifty business and community leaders from the greater Worcester area, the board will help us in our marketing efforts by proposing new ideas for generating business as well as referring associates and contacts to CNB. We held our first meeting in June and look forward to many more productive sessions focused on new marketing strategies and product ideas to further enhance customer service and tap into new business markets in the future.

Finally, we engaged a new auditing firm, Wolf & Company, P.C., one of the largest regional certified public accounting and business consulting firms in the Northeast, as our independent auditor.  Wolf & Company has a stellar reputation and we are very pleased to have them on board.

As we look ahead, we are prepared to continuously address the market challenges until the rate environment begins to turn around. As always, we will keep you informed of our new programs, technology, and customer service enhancements.

Sincerely,

Charles R. Valade

President and CEO

Cary J. Corkin

Chairman of Board

Consolidated Balance Sheets (Unaudited)

ASSETS	June 30,			December 31,			June 30,
	2007			2006			2007
Cash and Cash Equivalents	$	13,418,000		$	6,736,000		$	18,316,000
Investment Securities Available-for-Sale, (amortized cost of $48,339,000  as of June 30, 2007, $54,808,000 as of December 31, 2006) and $54,821,000 as of June 30, 2006) (Note 4)		47,750,000			54,582,000			53,649,000
Investment Securities Held-to-Maturity, (fair value of $9,910,000 as of June 30, 2007,  $12,450,000 as of December 31, 2006 and $12,330,000 as of June 30, 2006) (Note 4)		10,050,000			12,513,000			12,598,000
Federal Reserve Bank Stock		736,000			700,000			682,000
Federal Home Loan Bank Stock		3,052,000			3,070,000			2,530,000
Loans		214,470,000			200,668,000			196,681,000
Less: Allowance for Loan Losses		(2,773,000	)		(2,807,000	)		(2,765,000	)
Loans, Net		211,697,000			197,861,000			193,916,000
Premises and Equipment, Net		2,487,000			2,521,000			2,017,000
Accrued Interest Receivable		1,140,000			1,297,000			1,119,000
Deferred Tax Asset		1,818,000			1,553,000			2,080,000
Prepaid Expenses and Other Assets		361,000			531,000			408,000
	$	292,509,000		$	281,364,000		$	287,315,000
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits	$	207,347,000		$	191,807,000		$	210,447,000
Federal Home Loan Bank Advances		48,000,000			52,250,000			49,500,000
Federal Funds Purchased		-			500,000			-
Subordinated Debentures		7,732,000			7,732,000			7,732,000
Securities Under Agreement to Repurchase		6,860,000			5,946,000			-
Accrued Expenses and Other Liabilities		2,383,000			2,958,000			2,114,000
Total Liabilities:		272,322,000			261,193,000			269,793,000
Commitments and Contingencies (Note 8)
Temporary Stockholders’ Equity (Note 6)		-			-			164,000
Stockholders' Equity:
Common Stock
Par Value: $1.00
Shares Authorized: 10,000,000 as of June 30, 2007,  December 31, 2006 and June 30, 2006
Issued and Outstanding: 2,283,000 as of June 30, 2007,  December 31, 2006 and 2,128,000 as of June 30, 2006		2,283,000			2,283,000			2,113,000
Additional Paid-in Capital		20,240,000			20,154,000			18,378,000
Accumulated Deficit		(2,011,000	)		(2,151,000	)		(2,441,000	)
Accumulated Other Comprehensive Loss  net of taxes		(325,000	)		(115,000	)		(692,000	)
Total Stockholders' Equity		20,187,000			20,171,000			17,358,000
	$	292,509,000		$	281,364,000		$	287,315,000

Refer to the Company’s 10-QSBs dated June 30, 2007 and June 30, 2006 for the accompanying notes which are an integral part of these consolidated statements.

Consolidated Statements of Income (Unaudited)

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2007		2006		2007		2006
Interest and Dividend Income:
Interest and Fees on Loans	$	3,896,000	$	3,438,000	$	7,648,000	$	6,609,000
Interest and Dividends on Investments		830,000		691,000		1,694,000		1,326,000
Total Interest and Dividend Income		4,726,000		4,129,000		9,342,000		7,935,000
Interest Expense:
Interest Expense on Deposits		1,836,000		1,510,000		3,521,000		2,742,000
Interest Expense on Borrowings		814,000		518,000		1,710,000		925,000
Total Interest Expense		2,650,000		2,028,000		5,231,000		3,667,000
Net Interest Income		2,076,000		2,101,000		4,111,000		4,268,000
Provision for Loan Losses		-		80,000		30,000		164,000
Net Interest Income, After Provision for Loan Losses		2,076,000		2,021,000		4,081,000		4,104,000
Other Income:
Fees on Deposit Accounts		53,000		53,000		103,000		105,000
Loan Related Fees		37,000		41,000		78,000		75,000
Other		26,000		27,000		54,000		59,000
Total Other Income		116,000		121,000		235,000		239,000
Operating Expense:
Employee Compensation and Benefits		1,106,000		1,039,000		2,196,000		2,042,000
Occupancy and Equipment		344,000		263,000		698,000		527,000
Professional Fees		183,000		156,000		323,000		322,000
Marketing and Public Relations		95,000		120,000		187,000		240,000
Data Processing Expense		109,000		96,000		233,000		186,000
Other General and Administrative Expenses		232,000		217,000		461,000		400,000
Total Operating Expense		2,069,000		1,891,000		4,098,000		3,717,000
Income Before Taxes		123,000		251,000		218,000		626,000
Provision for Income Taxes		42,000		122,000		78,000		280,000
Net Income	$	81,000	$	129,000	$	140,000	$	346,000
Net Income per Basic Share	$	0.04	$	0.06	$	0.06	$	0.16
Net Income per Diluted Share	$	0.04	$	0.06	$	0.06	$	0.16
Weighted Average Shares - Basic		2,283,000		2,122,000		2,283,000		2,118,000
Weighted Average Shares - Diluted		2,294,000		2,208,000		2,303,000		2,197,000

Refer to the Company’s 10-QSBs dated June 30, 2007 and June 30, 2006 for the accompanying notes which are an integral part of these consolidated statements.