10-Q

UNITED STATES  

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

Quarterly Report Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

For the Quarterly period ended March 31, 2022

Commission file number 001-35296

FARMERS NATIONAL BANC CORP.

(Exact name of registrant as specified in its charter)

Ohio	34-1371693
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No)
20 South Broad Street Canfield, OH	44406
(Address of principal executive offices)	(Zip Code)

(330) 533-3341

(Registrant’s telephone number, including area code)

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act.

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, No Par Value	FMNB	The NASDAQ Stock Market

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  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Small reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class	Outstanding at April 30, 2022
Common Stock, No Par Value	34,007,677 shares

		Page Number
PART I - FINANCIAL INFORMATION
Item 1	Financial Statements (Unaudited)
	Included in Part I of this report:
	Farmers National Banc Corp. and Subsidiaries
	Consolidated Balance Sheets	2
	Consolidated Statements of Income	3
	Consolidated Statements of Comprehensive Income	4
	Consolidated Statements of Stockholders’ Equity	5
	Consolidated Statements of Cash Flows	6
	Notes to Unaudited Consolidated Financial Statements	7
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31
Item 3	Quantitative and Qualitative Disclosures About Market Risk	39
Item 4	Controls and Procedures	39
PART II - OTHER INFORMATION		40
Item 1	Legal Proceedings	40
Item 1A	Risk Factors	40
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	40
Item 3	Defaults Upon Senior Securities	40
Item 4	Mine Safety Disclosures	40
Item 5	Other Information	40
Item 6	Exhibits	41
SIGNATURES		43
10-Q Certifications
Section 906 Certifications

1

CONSOLIDATED BALANCE SHEETS

FARMERS NATIONAL BANC CORP. AND SUBSIDIARIES

	(In Thousands of Dollars)
(Unaudited)	March 31, 2022			December 31, 2021
ASSETS
Cash and due from banks	$	29,224		$	29,150
Federal funds sold and other		108,403			83,640
TOTAL CASH AND CASH EQUIVALENTS		137,627			112,790
Securities available for sale		1,463,626			1,427,677
Other investments		34,019			30,459
Loans held for sale		1,904			4,545
Loans		2,304,971			2,331,082
Less allowance for credit losses		27,015			29,386
NET LOANS		2,277,956			2,301,696
Premises and equipment, net		37,105			37,520
Goodwill		94,240			94,240
Other intangibles, net		7,947			8,366
Bank owned life insurance		74,264			73,855
Other assets		77,167			51,601
TOTAL ASSETS	$	4,205,855		$	4,142,749
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Noninterest-bearing	$	963,143		$	916,237
Interest-bearing		2,690,668			2,630,998
Brokered time deposits		40,000			0
TOTAL DEPOSITS		3,693,811			3,547,235
Long-term borrowings		87,872			87,758
Other liabilities		30,286			35,324
TOTAL LIABILITIES		3,811,969			3,670,317
Commitments and contingent liabilities
Stockholders' Equity:
Common Stock - Authorized 50,000,000 shares in 2022 and 2021; 35,128,962 shares issued in 2022 and 2021 and 34,007,677 and 33,898,237 shares outstanding in 2022 and 2021, respectively		304,670			306,123
Retained earnings		184,302			173,896
Accumulated other comprehensive income		(79,500	)		9,295
Treasury stock, at cost; 1,121,285 and 1,230,725 shares in 2022 and 2021, respectively		(15,586	)		(16,882	)
TOTAL STOCKHOLDERS' EQUITY		393,886			472,432
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	4,205,855		$	4,142,749

See accompanying notes

2

CONSOLIDATED STATEMENTS OF INCOME

FARMERS NATIONAL BANC CORP. AND SUBSIDIARIES

	(In Thousands except Per Share Data)
	For the Three Months Ended
(Unaudited)	March 31, 2022			March 31, 2021
INTEREST AND DIVIDEND INCOME
Loans, including fees	$	25,562		$	23,805
Taxable securities		4,587			1,719
Tax exempt securities		2,952			2,074
Dividends		130			121
Federal funds sold and other interest income		48			71
TOTAL INTEREST AND DIVIDEND INCOME		33,279			27,790
INTEREST EXPENSE
Deposits		1,244			2,226
Short-term borrowings		1			4
Long-term borrowings		792			293
TOTAL INTEREST EXPENSE		2,037			2,523
NET INTEREST INCOME		31,242			25,267
(Credit) provision for credit losses		(930	)		425
Provision for unfunded loans		572			0
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES		31,600			24,842
NONINTEREST INCOME
Service charges on deposit accounts		1,145			808
Bank owned life insurance income, including death benefit		409			284
Trust fees		2,519			2,236
Insurance agency commissions		1,047			1,003
Security (losses) gains, including fair value changes for equity securities		(11	)		488
Retirement plan consulting fees		397			320
Investment commissions		694			504
Net gains on sale of loans		1,129			2,900
Other mortgage banking income (loss), net		60			(115	)
Debit card and EFT fees		1,416			1,171
Legal settlement		8,400			0
Other operating income		493			533
TOTAL NONINTEREST INCOME		17,698			10,132
NONINTEREST EXPENSES
Salaries and employee benefits		11,831			9,976
Occupancy and equipment		2,680			2,275
State and local taxes		678			554
Professional fees		3,135			1,056
Merger related costs		1,940			12
Advertising		392			260
FDIC insurance		267			170
Intangible amortization		420			316
Core processing charges		745			627
Charitable donation		6,000			0
Other operating expenses		2,368			2,071
TOTAL NONINTEREST EXPENSES		30,456			17,317
INCOME BEFORE INCOME TAXES		18,842			17,657
INCOME TAXES		2,998			3,101
NET INCOME	$	15,844		$	14,556
EARNINGS PER SHARE - basic	$	0.47		$	0.52
EARNINGS PER SHARE - fully diluted	$	0.47		$	0.51

See accompanying notes

3

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FARMERS NATIONAL BANC CORP. AND SUBSIDIARIES

	(In Thousands of Dollars)
	For the Three Months Ended
(Unaudited)	March 31, 2022			March 31, 2021
NET INCOME	$	15,844		$	14,556
Other comprehensive income:
Net unrealized holding losses on available for sale securities		(112,398	)		(14,934	)
Reclassification adjustment for (gains) realized in income		0			(383	)
Net unrealized holding losses		(112,398	)		(15,317	)
Income tax effect		23,605			3,217
Unrealized holding losses, net of reclassification and tax		(88,793	)		(12,100	)
Change in funded status of post-retirement plan, net of tax		(2	)		0
Other comprehensive loss, net of tax		(88,795	)		(12,100	)
TOTAL COMPREHENSIVE INCOME (LOSS)	$	(72,951	)	$	2,456

See accompanying notes

4

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

FARMERS NATIONAL BANC CORP. AND SUBSIDIARIES

(Table Dollar Amounts in Thousands except Per Share Data)

							Accumulated
							Other
	Common			Retained			Comprehensive			Treasury
(Unaudited)	Stock			Earnings			Income (Loss)			Stock			Total
Balance December 31, 2021	$	306,123		$	173,896		$	9,295		$	(16,882	)	$	472,432
Net income					15,844									15,844
Other comprehensive loss								(88,795	)					(88,795	)
Restricted share issuance		(1,030	)								1,030			0
Stock based compensation expense		365												365
Vesting of Long Term Incentive Plan		(788	)								368			(420	)
Share forfeitures for taxes											(102	)		(102	)
Dividends paid at $0.16 per share					(5,438	)								(5,438	)
Balance March 31, 2022	$	304,670		$	184,302		$	(79,500	)	$	(15,586	)	$	393,886
							Accumulated
							Other
	Common			Retained			Comprehensive			Treasury
(Unaudited)	Stock			Earnings			Income (Loss)			Stock			Total
Balance December 31, 2020		208,763			138,073			22,032			(18,771	)		350,097
Net income					14,556									14,556
Other comprehensive loss								(12,100	)					(12,100	)
Stock based compensation expense		330												330
Vesting of Long Term Incentive Plan		(894	)								894			0
Share forfeitures for taxes											(366	)		(366	)
Cumulative impact of ASU 2016-13 adoption (CECL)					(1,936	)								(1,936	)
Dividends paid at $0.11 per share					(3,110	)								(3,110	)
Treasury share purchases											(116	)		(116	)
Balance March 31, 2021	$	208,199		$	147,583		$	9,932		$	(18,359	)	$	347,355

See accompanying notes.

5

CONSOLIDATED STATEMENTS OF CASH FLOWS

FARMERS NATIONAL BANC CORP. AND SUBSIDIARIES

	(In Thousands of Dollars)
	Three Months Ended
(Unaudited)	March 31, 2022			March 31, 2021
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	15,844		$	14,556
Adjustments to reconcile net income to net cash from operating activities:
Provision for credit losses		(930	)		425
Provision for unfunded loans		572			0
Depreciation and amortization		1,162			798
Net amortization of securities		1,378			618
Available for sale security gain		0			(383	)
Realized (gains) losses on equity securities		11			(105	)
Loss on premises and equipment sales and disposals, net		112			52
Stock compensation expense		365			330
Earnings on bank owned life insurance		(409	)		(284	)
Origination of loans held for sale		(41,419	)		(51,990	)
Proceeds from loans held for sale		45,369			55,948
Net gains on sale of loans		(1,129	)		(2,900	)
Net change in other assets and liabilities		(7,727	)		(10,028	)
NET CASH FROM OPERATING ACTIVITIES		13,199			7,037
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities and repayments of securities available for sale		22,712			17,155
Proceeds from sales of securities available for sale		0			26,186
Purchases of securities available for sale		(172,437	)		(241,345	)
Proceeds from sales of equity securities		18			20
Purchase of equity securities		(17	)		(25	)
Proceeds from maturities and repayments of SBIC funds		454			285
Purchases of SBIC funds		(454	)		(196	)
Proceeds from redemption of regulatory stock		0			253
Purchase of regulatory stock		(3,572	)		(22	)
Loan originations and payments, net		24,098			42,976
Proceeds from land and building sales		21			0
Additions to premises and equipment		(346	)		(219	)
NET CASH FROM INVESTING ACTIVITIES		(129,523	)		(154,932	)
CASH FLOWS FROM FINANCING ACTIVITIES
Net change in deposits		146,576			222,176
Net change in short-term borrowings		0			2,689
Repayment of long-term borrowings		0			(1,980	)
Cash dividends paid		(5,415	)		(3,110	)
Repurchase of common shares		0			(116	)
NET CASH FROM FINANCING ACTIVITIES		141,161			219,659
NET CHANGE IN CASH AND CASH EQUIVALENTS		24,837			71,764
Beginning cash and cash equivalents		112,790			254,621
Ending cash and cash equivalents	$	137,627		$	326,385
Supplemental cash flow information:
Interest paid	$	1,498		$	2,597
Supplemental noncash disclosures:
Transfer of loans to other real estate	$	0		$	30
Security purchases not settled	$	0		$	44,814
Issuance of stock awards	$	1,398		$	894

See accompanying notes

6

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Principles of Consolidation:

Farmers National Banc Corp. (“Company”) is a Financial Holding Company registered under the Bank Holding Company Act of 1956, as amended.  The Company provides full banking services through its nationally chartered subsidiary, The Farmers National Bank of Canfield (“Bank”).  The consolidated financial statements also include the accounts of the Bank’s subsidiaries; Farmers National Insurance, LLC (“Insurance”) and Farmers of Canfield Investment Co. (“Investments”).  The Company provides trust and retirement consulting services through its subsidiary, Farmers Trust Company (“Trust”), and insurance services through the Bank’s subsidiary, Insurance.  Farmers National Captive, Inc. (“Captive”) is a wholly-owned insurance subsidiary of the Company that provides property and casualty insurance coverage to the Company and its subsidiaries.  The Captive pools resources with eleven similar insurance company subsidiaries of financial institutions to spread a limited amount of risk among themselves and to provide insurance where not currently available or economically feasible in today’s insurance market place.  The consolidated financial statements include the accounts of the Company, the Bank and its subsidiaries, along with the Trust and Captive.  All significant intercompany balances and transactions have been eliminated in the consolidation.

Basis of Presentation:

The unaudited condensed consolidated financial statements have been prepared in conformity with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements.  The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2021 Annual Report to Shareholders included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 (“2021 Form 10-K”).  The interim consolidated financial statements include all adjustments (consisting of only normal recurring items) that, in the opinion of management, are necessary for a fair presentation of the financial position and results of operations for the periods presented.  The results of operations for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year.  Certain items included in the prior period financial statements were reclassified to conform to the current period presentation. There was no effect on net income or total stockholders’ equity.

Estimates:

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Segments:

The Company provides a broad range of financial services to individuals and companies in northeastern Ohio and western Pennsylvania.  Operations are managed and financial performance is primarily aggregated and reported in two lines of business, the Bank segment and the Trust segment.

Equity:

There are 50,000,000 shares authorized and available for issuance as of March 31, 2022.  Outstanding shares at March 31, 2022 were 34,007,677.

Comprehensive Income:

Comprehensive income consists of net income and other comprehensive income.  Other comprehensive income consists of unrealized gains and losses on securities available for sale and changes in the funded status of the post-retirement plan, which are recognized as components of stockholders’ equity, net of tax effect.

7

Updates to Significant Accounting Policies:

New Accounting Standard:

On March 31, 2022, FASB issued ASU 2022-2, which eliminates the troubled debt restructuring (“TDR”), accounting model for creditors that have adopted Topic 326, Financial Instruments – Credit Losses.”  Due to the removal of the TDR accounting model, all loan modifications now will be accounted for under the general loan modification guidance in Subtopic 310-20.  In addition, on a prospective basis, entities will be subject to new disclosure requirements covering modifications of receivables to borrowers experiencing financial difficulty.  Public business entities within the scope of the Topic 326 vintage disclosure requirements also will be required to prospectively disclose current-period gross write-off information by vintage, or year of origination.  For entities that have adopted Topic 326, ASU 2022-02 takes effect in reporting periods beginning after December 15, 2022.  Early adoption is permitted.  The Company has not elected to early adopt this ASU at this time.  The adoption of this standard is not expected to have a material effect on the Company’s operating results or financial condition.

Business Combinations:

On March 23, 2022, Farmers entered into an agreement and plan of merger with Emclaire Financial (“Emclaire”), the parent company of The Farmers National Bank of Emlenton (“Emlenton”).  The transaction is subject to receipt of Emclaire shareholder approval and customary regulatory approvals and is expected to close in the second half of 2022.  The transaction will create a large expansion in Pennsylvania and into the Pittsburgh market.  Emclaire operates 19 branches in ten counties throughout western Pennsylvania.  As of March 31, 2022, Emclaire had total assets of $1.1 billion, gross loans of $794.9 million, deposits of $936.0 million and equity of $86.7 million.

On November 1, 2021, the Company completed the merger with Cortland Bancorp (“Cortland”), the parent company of The Cortland Savings and Banking Company (“Cortland Bank”), pursuant to the Agreement and Plan of Merger, dated as of June 22, 2021, as amended by that certain Amendment to Agreement and Plan of Merger, dated October 12, 2021 (collectively, the “Merger Agreement”), by and among the Company, Cortland, and FMNB Merger Subsidiary IV, LLC, a wholly-owned subsidiary of the Company (“Merger Sub”).  Pursuant to the terms of the Merger Agreement, on November 1, 2021, Cortland merged with and into Merger Sub (the “Merger”), with Merger Sub as the surviving entity in the Merger.  Promptly following the consummation of the Merger, Merger Sub was dissolved and liquidated and Cortland Bank merged with and into the Bank (the “Bank Merger”), with the Bank as the surviving bank in the Bank Merger.  The transaction received the approval of Cortland’s shareholders and all customary regulatory approvals.  Pursuant to the terms of the Merger Agreement, at the effective time of the Merger, each common share, without par value, of Cortland issued and outstanding immediately prior to the effective time (except for certain Cortland common shares held directly by Cortland or the Company) was converted into the right to receive, without interest, $28.00 per share in cash or 1.75 shares of the Company’s common stock, subject to an overall limitation of 75% of the Cortland shares being exchanged for the Company’s shares and the remaining 25% being exchanged for cash.  The Company issued 5.6 million shares of its common stock along with cash of $29.6 million, which represented a transaction value of approximately $128.5 million based on its closing stock price of $17.82 on October 31, 2021, the closing of the Merger.                                                                                        

In accordance with ASC 805, the Company expensed approximately $1.9 million of merger related costs during the period ended March 31, 2022, in addition to $7.1 million expensed in the year ended 2021.  The Company recorded goodwill of $48.5 million as a result of the combination.  Goodwill represents the future economic benefits arising from net assets acquired that are not individually identified and separately recognized and is attributable to synergies, including the reduction of  personnel and overlapping contracts, expected to be derived from the Company’s strategy to enhance and expand its presence in northeast Ohio.  The merger offers the Company the opportunity to increase profitability by introducing existing products and services to the acquired customer base as well as add new customers in the expanded market area.  The goodwill was determined not to be deductible for income tax purposes.

8

The following table summarizes the consideration paid for Cortland and the amounts of the assets acquired and liabilities assumed on the closing date of the acquisition.

(In Thousands of Dollars)
Consideration
Cash	$	29,618
Stock		98,921
Fair value of total consideration transferred	$	128,539
Fair value of assets acquired
Cash and cash equivalents	$	113,391
Securities available for sale		130,574
Other investments		16,092
Loans		482,168
Premises and equipment		12,644
Bank owned life insurance		21,547
Core deposit intangible		5,886
Current and deferred taxes		3,135
Other assets		7,805
Total assets acquired		793,242
Fair value of liabilities assumed
Deposits		695,274
Short-term borrowings		4,246
Long-term borrowings		4,262
Accrued interest payable and other liabilities		9,386
Total liabilities		713,168
Net assets acquired	$	80,074
Goodwill created		48,465
Total net assets acquired	$	128,539

Securities:

The following table summarizes the amortized cost and fair value of the available for sale investment securities portfolio at March 31, 2022 and December 31, 2021 and the corresponding amounts of unrealized gains and losses recognized in accumulated other comprehensive income:

			Gross		Gross
	Amortized		Unrealized		Unrealized
(In Thousands of Dollars)	Cost		Gains		Losses			Fair Value
March 31, 2022
U.S. Treasury and U.S. government sponsored entities	$	114,063	$	3	$	(9,119	)	$	104,947
State and political subdivisions		681,567		5,274		(41,233	)		645,608
Corporate bonds		4,399		4		(108	)		4,295
Mortgage-backed securities - residential		718,295		117		(54,717	)		663,695
Collateralized mortgage obligations - residential		41,039		21		(735	)		40,325
Small Business Administration		4,943		0		(187	)		4,756
Totals	$	1,564,306	$	5,419	$	(106,099	)	$	1,463,626

9

			Gross		Gross
	Amortized		Unrealized		Unrealized
(In Thousands of Dollars)	Cost		Gains		Losses			Fair Value
December 31, 2021
U.S. Treasury and U.S. government sponsored entities	$	93,137	$	32	$	(2,338	)	$	90,831
State and political subdivisions		636,724		23,296		(1,205	)		658,815
Corporate bonds		4,009		50		(29	)		4,030
Mortgage-backed securities - residential		663,405		1,875		(10,094	)		655,186
Collateralized mortgage obligations - residential		13,303		153		(71	)		13,385
Small Business Administration		5,381		49		0			5,430
Totals	$	1,415,959	$	25,455	$	(13,737	)	$	1,427,677

There were no sales of securities in the first quarter ended March 31, 2022.  Proceeds from the sale of portfolio securities were $26.2 million during the three month period ended March 31, 2021.  Gross gains of $406 thousand and gross losses of $23 thousand were realized on these sales during the three month period ended March 31, 2021.  In addition, $11 thousand of realized losses and $105 thousand of realized gains on equity securities were recognized in the income statement during the three month periods ended March 31, 2022 and March 31, 2021, respectively.

The amortized cost and fair value of the debt securities portfolio are shown in the table below by expected maturity.  Expected maturities may differ from contractual maturities if issuers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.

	March 31, 2022
(In Thousands of Dollars)	Amortized Cost		Fair Value
Maturity
Within one year	$	1,213	$	1,215
One to five years		14,507		14,683
Five to ten years		152,628		143,677
Beyond ten years		631,681		595,275
Mortgage-backed, collateralized mortgage obligations and Small Business Administration securities		764,277		708,776
Total	$	1,564,306	$	1,463,626

The following table summarizes the available for sale investment securities with unrealized losses at March 31, 2022 and December 31, 2021, aggregated by major security type and length of time in a continuous unrealized loss position.   

	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands of Dollars)	Value		Loss			Value		Loss			Value		Loss
March 31, 2022
U.S. Treasury and U.S. government sponsored entities	$	94,866	$	(8,125	)	$	9,753	$	(994	)	$	104,619	$	(9,119	)
State and political subdivisions		420,523		(38,939	)		14,420		(2,294	)		434,943		(41,233	)
Corporate bonds		1,009		(38	)		670		(70	)		1,679		(108	)
Mortgage-backed securities - residential		511,033		(42,169	)		110,117		(12,548	)		621,150		(54,717	)
Collateralized mortgage obligations - residential		18,856		(735	)		0		0			18,856		(735	)
Small Business Administration		4,756		(187	)		0		0			4,756		(187	)
Total temporarily impaired	$	1,051,043	$	(90,193	)	$	134,960	$	(15,906	)	$	1,186,003	$	(106,099	)

10

	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands of Dollars)	Value		Loss			Value		Loss			Value		Loss
December 31, 2021
U.S. Treasury and U.S. government sponsored entities	$	81,236	$	(1,960	)	$	8,271	$	(378	)	$	89,507	$	(2,338	)
State and political subdivisions		103,651		(1,020	)		10,020		(185	)		113,671		(1,205	)
Corporate bonds		418		(2	)		715		(27	)		1,133		(29	)
Mortgage-backed securities - residential		525,792		(7,872	)		55,569		(2,222	)		581,361		(10,094	)
Collateralized mortgage obligations - residential		7,270		(71	)		0		0			7,270		(71	)
Total temporarily impaired	$	718,367	$	(10,925	)	$	74,575	$	(2,812	)	$	792,942	$	(13,737	)

Allowance for Credit Losses

The Company adopted ASU 2016-13 prior to 2021, which made improvements to the accounting for credit losses on securities available for sale.  During the evaluation process, management considers the extent to which the fair value has been less than cost, the financial condition and near term prospects of the issuer, and the intent and ability of the Company to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value.      

If the Company determines that a credit loss exists, the credit portion of the allowance will be measured using a discounted cash flow analysis using the effective interest rate as of the security’s purchase date.  As of March 31, 2022, the Company’s security portfolio consisted of 879 securities, 595 of which were in an unrealized loss position.  The majority of the unrealized losses on the Company’s securities are related to its holdings of mortgage-backed securities and state and political subdivisions.  The Company does not consider its AFS securities with unrealized losses to be attributable to credit-related factors, as the unrealized losses have occurred as a result of changes in noncredit related factors such as changes in interest rates, market spreads and market conditions subsequent to purchase, not credit deterioration.  As of March 31, 2022 the Company has not recorded an allowance for credit losses on AFS securities.

Loans:

Loan balances were as follows:

(In Thousands of Dollars)	March 31, 2022			December 31, 2021
Commercial real estate
Owner occupied	$	347,173		$	340,369
Non-owner occupied		540,194			533,240
Farmland		173,568			177,706
Other		113,605			138,282
Commercial
Commercial and industrial		298,903			313,836
Agricultural		51,277			54,659
Residential real estate
1-4 family residential		455,501			453,635
Home equity lines of credit		128,221			127,433
Consumer
Indirect		167,147			159,006
Direct		18,859			21,121
Other		6,580			9,395
Total originated loans	$	2,301,028		$	2,328,682
Net Deferred loan (fees) costs		3,943			2,400
Allowance for credit losses		(27,015	)		(29,386	)
Net loans	$	2,277,956		$	2,301,696

11

Allowance for credit loss activity

The following tables present the activity in the allowance for credit losses by portfolio segment for the three month period ended March 31, 2022 and 2021:

Three Months Ended March 31, 2022

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	15,879		$	4,949		$	4,870		$	3,688		$	29,386
Provision for credit losses		(672	)		271			(146	)		(383	)		(930	)
Loans charged off		0			(1,359	)		(34	)		(197	)		(1,590	)
Recoveries		0			6			12			131			149
Total ending allowance balance	$	15,207		$	3,867		$	4,702		$	3,239		$	27,015

Three Months Ended March 31, 2021

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	10,824		$	5,073		$	3,643		$	2,604		$	22,144
Impact of CECL adoption		(2,076	)		429			237			3,860			2,450
Provision for credit losses		96			(25	)		89			265			425
Loans charged off		0			(34	)		(67	)		(183	)		(284	)
Recoveries		0			7			59			134			200
Total ending allowance balance	$	8,844		$	5,450		$	3,961		$	6,680		$	24,935

The following table presents the recorded investment in nonaccrual and loans past due 90 days or more still on accrual by class of loans as of March 31, 2022 and December 31, 2021:

	March 31, 2022				December 31, 2021
(In Thousands of Dollars)	Nonaccrual		Loans Past Due 90 Days or More Still Accruing		Nonaccrual		Loans Past Due 90 Days or More Still Accruing
Commercial real estate
Owner occupied	$	416	$	0	$	433	$	0
Non-owner occupied		2,477		0		2,511		0
Farmland		271		0		274		0
Other		53		0		60		0
Commercial
Commercial and industrial		5,534		2		7,190		54
Agricultural		43		0		40		0
Residential real estate
1-4 family residential		2,940		671		3,363		459
Home equity lines of credit		928		0		917		36
Consumer
Indirect		456		52		455		123
Direct		180		23		227		53
Other		0		0		0		0
Total loans	$	13,298	$	748	$	15,470	$	725

12

The following tables present the aging of the recorded investment in past due loans as of March 31, 2022 and December 31, 2021 by class of loans.  Note that loans on a modification to defer payments under the CARES Act are included in loans not past due for the period ending December 31, 2021.  There were no loans on deferred payments at March 31, 2022.

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
March 31, 2022
Commercial real estate
Owner occupied	$	68	$	0	$	416	$	484	$	346,298	$	346,782
Non-owner occupied		1		0		2,477		2,478		537,157		539,635
Farmland		0		0		271		271		173,000		173,271
Other		0		0		53		53		113,294		113,347
Commercial
Commercial and industrial		185		5		5,536		5,726		292,823		298,549
Agricultural		137		53		43		233		51,296		51,529
Residential real estate
1-4 family residential		5,583		71		3,611		9,265		445,497		454,762
Home equity lines of credit		138		23		928		1,089		127,154		128,243
Consumer
Indirect		479		268		508		1,255		172,096		173,351
Direct		242		50		203		495		18,427		18,922
Other		1		0		0		1		6,579		6,580
Total loans	$	6,834	$	470	$	14,046	$	21,350	$	2,283,621	$	2,304,971

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
December 31, 2021
Commercial real estate
Owner occupied	$	70	$	591	$	433	$	1,094	$	338,880	$	339,974
Non-owner occupied		394		311		2,511		3,216		529,490		532,706
Farmland		0		0		274		274		177,143		177,417
Other		56		0		60		116		137,878		137,994
Commercial
Commercial and industrial		256		100		7,244		7,600		304,932		312,532
Agricultural		100		28		40		168		54,706		54,874
Residential real estate
1-4 family residential		4,452		1,077		3,822		9,351		443,441		452,792
Home equity lines of credit		80		12		953		1,045		126,405		127,450
Consumer
Indirect		795		275		578		1,648		163,112		164,760
Direct		203		91		280		574		20,614		21,188
Other		0		0		0		0		9,395		9,395
Total loans	$	6,406	$	2,485	$	16,195	$	25,086	$	2,305,996	$	2,331,082

Troubled Debt Restructurings

Total troubled debt restructurings were $3.8 million and $3.9 million at March 31, 2022, and December 31, 2021, respectively.  The Company has allocated $111 thousand and $109 thousand of specific reserves to loans whose terms have been modified in troubled debt restructurings at March 31, 2022, and December 31, 2021, respectively.  There were no commitments to lend additional amounts to borrowers with loans that were classified as troubled debt restructurings at March 31, 2022, and at December 31, 2021.

13

During the three month periods ended March 31, 2022 and 2021, the terms of certain loans were modified as troubled debt restructurings.  The modification of the terms of such loans included one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; a deferral of principal, interest and/or escrow; or a legal concession.  During the three month period ended March 31, 2022, the terms of such loans included a reduction of the stated interest rate of the loan of 3.345%.  During the same three month period in 2021, the terms of such loans included a reduction of the stated interest rate of the loan of 4.075% and an extension of the maturity date of 22 days.        

The following table presents loans by class modified as troubled debt restructurings that occurred during the three month period ended March 31, 2022 and 2021:

			Pre- Modification		Post- Modification
Three Months Ended March 31, 2022	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
1-4 family residential		1	$	50	$	52
Home equity lines of credit		1		14		14
Consumer
Indirect		1		14		14
Total loans		3	$	78	$	80

			Pre- Modification		Post- Modification
Three Months Ended March 31, 2021	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Commercial		4	$	22	$	22
Residential real estate
1-4 family residential		1		69		73
Home equity lines of credit		1		31		31
Consumer
Indirect		6		87		87
Total loans		12	$	209	$	213

There were no charge offs and no increase to the provision for credit losses during the three month period ended March 31, 2022 and  $20 thousand in charge offs and a $20 thousand increase to the provision for credit losses during the three month period ended March 31, 2021, as a result of outstanding troubled debt restructurings.        

There was  one residential real estate loan for which there was a payment default within twelve months following the modification of the troubled debt restructuring during the three month period ended March 31, 2022.  The loan was not past due at March 31, 2022.  There was no provision recorded as a result of the defaults during 2022.  A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.

There was one residential real estate loan for which there was a payment default within twelve months following the modification of the troubled debt restructuring during the three month period ended March 31, 2021.  The loan was not past due at March 31, 2021. There was no provision recorded as a result of the defaults during 2021.  A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.    

The Company offered three month deferrals upon request by the borrowers. For those borrowers in industries that were greatly impacted by COVID-19, additional deferrals were considered and granted beyond the initial three month period throughout 2021. The range of deferred months for subsequent requests were three to twelve months. The decline in deferred loans and balances was due to borrowers not requesting additional deferments and most continued to pay under the original terms of their loan. As of March 31, 2022 there are no longer borrowers on deferment due to COVID-19 related issues.

14

Farmers is also a preferred U.S. Small Business Administration (“SBA”) lender and dedicated significant additional staff and other resources to help our customers complete and submit their applications and supporting documentation for loans offered under the Paycheck Protection Program (“PPP”) under the CARES Act, so they could obtain SBA approval and receive funding as quickly as possible. During the period of the PPP program, the Company facilitated PPP assistance to 2,134 business customers totaling $256.4 million.  The Company, on behalf of its customers, began processing borrower applications for PPP forgiveness at the beginning of September 2020.  The SBA has up to ninety days to review an application for PPP forgiveness and provide a decision at the end of that review.  Once forgiveness of the PPP loan has been communicated and payment is received from the SBA, the Company will record the cash received from the SBA, pay-off the loans based on the amount of forgiveness provided and accelerate the amount of net deferred loan fees/costs recognized for the portion of the PPP loans that are forgiven.  During the period ended March 31, 2022, the Company has received life to date payments from the SBA for forgiveness of loans totaling $256.3 million, or approximately 99.98% of the PPP loans originated in 2020. The Company processed $107.9 million in new loans for PPP loan funding during 2021. The Company has also received payments from the SBA for forgiveness of loans totaling $84.9 million, or approximately 78.7%, of PPP loans originated in 2021.

Credit Quality Indicators

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors.  The Company establishes a risk rating at origination for all commercial loan and commercial real estate relationships.  For relationships over $1 million, management monitors the loans on an ongoing basis for any changes in the borrower’s ability to service their debt.  Management also affirms the risk ratings for the loans in their respective portfolios on an annual basis.  The Company uses the following definitions for risk ratings:

Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention.  If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.  Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification.

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any.  Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt.  Substandard loans are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans.

As of March 31, 2022 and December 31, 2021, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

(In Thousands of Dollars)	Pass		Special Mention		Sub standard		Total
March 31, 2022
Commercial real estate
Owner occupied	$	338,256	$	4,430	$	4,096	$	346,782
Non-owner occupied		506,509		14,708		18,418		539,635
Farmland		170,456		2,145		670		173,271
Other		112,473		499		375		113,347
Commercial
Commercial and industrial		289,651		1,308		7,590		298,549
Agricultural		50,936		507		86		51,529
Total loans	$	1,468,281	$	23,597	$	31,235	$	1,523,113

15

(In Thousands of Dollars)	Pass		Special Mention		Sub standard		Total
December 31, 2021
Commercial real estate
Owner occupied	$	330,754	$	5,006	$	4,214	$	339,974
Non-owner occupied		495,170		19,366		18,170		532,706
Farmland		174,580		2,160		677		177,417
Other		137,063		784		147		137,994
Commercial
Commercial and industrial		301,879		1,190		9,463		312,532
Agricultural		54,394		397		83		54,874
Total loans	$	1,493,840	$	28,903	$	32,754	$	1,555,497

The Company considers the performance of the loan portfolio and its impact on the allowance for credit losses.  For residential, consumer indirect and direct loan classes, the Company evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity.  In the 1-4 family residential real estate portfolio at March 31, 2022, other real estate owned and foreclosure properties were $0 and $216 thousand, respectively.  At December 31, 2021, other real estate owned and foreclosure properties were $0 and $93 thousand, respectively.

The following tables present the recorded investment in residential, consumer indirect and direct auto loans based on payment activity as of March 31, 2022 and December 31, 2021.  Nonperforming loans are loans past due 90 days or more and still accruing interest and nonaccrual loans.

	Residential Real Estate				Consumer
(In Thousands of Dollars)	1-4 Family Residential		Home Equity Lines of Credit		Indirect		Direct		Other
March 31, 2022
Performing	$	451,151	$	127,315	$	172,843	$	18,719	$	6,580
Nonperforming		3,611		928		508		203		0
Total loans	$	454,762	$	128,243	$	173,351	$	18,922	$	6,580

	Residential Real Estate				Consumer
(In Thousands of Dollars)	1-4 Family Residential		Home Equity Lines of Credit		Indirect		Direct		Other
December 31, 2021
Performing	$	448,970	$	126,497	$	164,182	$	20,908	$	9,395
Nonperforming		3,822		953		578		280		6
Total loans	$	452,792	$	127,450	$	164,760	$	21,188	$	9,401

16

The following table presents total loans by risk categories and year of origination.

	Term Loans Amortized Cost Basis by Origination Year
As of March 31, 2022	2022		2021		2020		2019		2018		Prior		Revolving Loans		Total
Commercial real estate
Risk Rating
Pass	$	34,484	$	170,585	$	141,201	$	163,632	$	114,598	$	314,075	$	18,663	$	957,238
Special mention		0		788		0		6,924		2,020		9,387		518		19,637
Substandard		40		0		661		2,648		492		18,441		607		22,889
Total commercial real estate loans	$	34,524	$	171,373	$	141,862	$	173,204	$	117,110	$	341,903	$	19,788	$	999,764
Commercial
Risk Rating
Pass	$	28,559	$	80,860	$	46,807	$	25,005	$	20,084	$	24,321	$	64,015	$	289,651
Special mention		0		533		103		122		31		2		517		1,308
Substandard		399		1,984		1,676		265		257		1,890		1,119		7,590
Total commercial loans	$	28,958	$	83,377	$	48,586	$	25,392	$	20,372	$	26,213	$	65,651	$	298,549
Agricultural
Risk Rating
Pass	$	9,435	$	42,324	$	49,368	$	27,039	$	27,002	$	51,111	$	15,113	$	221,392
Special mention		0		0		227		31		0		2,045		349		2,652
Substandard		0		365		17		58		11		275		30		756
Total agricultural loans	$	9,435	$	42,689	$	49,612	$	27,128	$	27,013	$	53,431	$	15,492	$	224,800
Residential real estate
Risk Rating
Pass	$	19,699	$	102,254	$	86,118	$	36,861	$	29,617	$	167,930	$	3,706	$	446,185
Special mention		0		0		73		127		80		139		0		419
Substandard		0		46		100		89		30		7,893		0		8,158
Total residential real estate loans	$	19,699	$	102,300	$	86,291	$	37,077	$	29,727	$	175,962	$	3,706	$	454,762
Home equity lines of credit
Risk Rating
Pass	$	0	$	0	$	149	$	0	$	19	$	1,744	$	124,320	$	126,232
Special mention		0		0		0		0		0		0		48		48
Substandard		0		13		12		51		143		1,626		118		1,963
Total home equity lines of credit	$	0	$	13	$	161	$	51	$	162	$	3,370	$	124,486	$	128,243
Consumer
Risk Rating
Pass	$	24,827	$	58,540	$	42,425	$	30,910	$	18,087	$	17,561	$	5,408	$	197,758
Substandard		0		120		261		253		102		359		0		1,095
Total consumer loans	$	24,827	$	58,660	$	42,686	$	31,163	$	18,189	$	17,920	$	5,408	$	198,853

17

Purchased Loans

As a result of the Cortland Merger, the Company acquired $478.2 million in loans, excluding $4.0 million of loans held for sale.

Under ASU Topic 326, when loans are purchased with evidence of more than significant deterioration of credit, they are accounted for as purchase credit deteriorated (“PCD”).  PCD loans acquired in a transaction are marked to fair value and a mark on yield is recorded.  In addition, an adjustment is made to the ACL for the expected loss on the acquisition date.  These loans are assessed on a regular basis and subsequent adjustments to the ACL are recorded on the income statement.  During 2021, the Company acquired PCD loans with a fair value of $34.3 million, credit discount of $1.3 million and a noncredit discount of $1.1 million.  The outstanding balance at March 31, 2022 and related allowance on these loans is as follows:

	Loan Balance		ACL Balance
Commercial real estate
Owner Occupied	$	2,531	$	82
Non-owner Occupied		20,017		890
Other		780		36
		23,328		1,008
Commercial
Commercial and industrial		1,775		106
Residential real estate
1-4 family residential		500		4
Total	$	25,603	$	1,118

Revenue from Contracts with Customers:

All material revenue from contracts with customers in the scope of ASC 606 is recognized within noninterest income.  The following table presents the Company’s noninterest income by revenue stream and reportable segment, net of eliminations, for the three months ended March 31, 2022 and 2021.

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Three Months Ended March 31, 2022
Service charges on deposit accounts	$	0	$	1,145	$	1,145
Debit card and EFT fees		0		1,416		1,416
Trust fees		2,519		0		2,519
Insurance agency commissions		0		1,047		1,047
Retirement plan consulting fees		397		0		397
Investment commissions		0		694		694
Other (outside the scope of ASC 606)		0		10,480		10,480
Total noninterest income	$	2,916	$	14,782	$	17,698

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Three Months Ended March 31, 2021
Service charges on deposit accounts	$	0	$	808	$	808
Debit card and EFT fees		0		1,171		1,171
Trust fees		2,236		0		2,236
Insurance agency commissions		0		1,003		1,003
Retirement plan consulting fees		320		0		320
Investment commissions		0		504		504
Other (outside the scope of ASC 606)		0		4,090		4,090
Total noninterest income	$	2,556	$	7,576	$	10,132

18

A description of the Company’s revenue streams under ASC 606 follows:

Service charges on deposit accounts – The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Management reviewed the deposit account agreements, and determined that the agreements can be terminated at any time by either the Bank or the account holder.  Transaction fees, such as balance transfers, wires and overdraft charges are settled the day the performance obligation is satisfied.  The Bank’s monthly service charges and maintenance fees are for services provided to the customer on a monthly basis and are considered a series of services that have the same pattern of transfer each month.  The review of service charges assessed on deposit accounts included the amount of variable consideration that is a part of the monthly charges.  It was found that the waiver of service charges due to insufficient funds and dormant account fees is immaterial and would not require a change in the accounting treatment for these fees under the new revenue standards.

Debit Card Interchange Fees – Customers and the Bank have an account agreement and maintain deposit balances with the Bank.  Customers use a bank issued debit card to purchase goods and services, and the Bank earns interchange fees on those transactions, typically a percentage of the sale amount of the transaction.  The Bank records the amount due when it receives the settlement from the payment network.  Payments from the payment network are received and recorded into income on a daily basis.  There are no contingent debit card interchange fees recorded by the Company that could be subject to a clawback in future periods.

Trust fees – Services provided to Trust customers are a series of distinct services that have the same pattern of transfer each month.  Fees for trust accounts are billed and drafted from trust accounts monthly.  The Company records these fees on the income statement on a monthly basis.  Fees are assessed based on the total investable assets of the customer’s trust account.  A signed contract between the Company and the customer is maintained for all customer trust accounts with payment terms identified.  It is probable that the fees will be collectible as funds being managed are accessible by the asset manager.  Past history of trust fee income recorded by the Company indicates that it is highly unlikely that a significant reversal could occur.  There are no contingent incentive fees recorded by the Company that could be subject to a clawback in future periods.

Insurance Agency Commissions – Insurance agency commissions are received from insurance carriers for the agency’s share of commissions from customer premium payments.  These commissions are recorded into income when checks are received from the insurance carriers, and there is no contingent portion associated with these commission checks.  There may be a short time-lag in recording revenue when cash is received instead of recording the revenue when the policy is signed by the customer, but the time lag is insignificant and does not impact the revenue recognition process.

Insurance also receives incentive checks from the insurance carriers for achieving specified levels of production with particular carriers.  These amounts are recorded into income when a check is received, and there are no contingent amounts associated with these payments that may be clawed back by the carrier in the future.  Similar to the monthly commissions explained in the preceding paragraph, there may be a short time-lag in recording incentive revenue on a cash basis as opposed to estimating the amount of incentive revenue expected to be earned, this does not materially impact the recognition of Insurance revenue.  If there were any amounts that would need to be refunded for one specific Insurance customer, management believes the reversal would not be significant.

Other potential situations surrounding the recognition of Insurance revenue include the estimating potential refunds due to the likely cancellation of a percentage of customers cancelling their policies and recording revenue at the time of policy renewals.  Management concluded that since Insurance agency commissions represent only 2.1% of the Company’s total revenue, adjusting the current practice of recording insurance revenue for these situations would not have a material impact on the reporting of total revenue.  

Retirement Plan Consulting Fees – Revenue is recognized based on the level of work performed for the client.  Any payments that are received for work to be performed in the future are recorded in a deferred revenue account, and recorded into income when the fees are earned.  Retirement plan consulting fees represent only 0.8% of the Company’s total revenue, and therefore management has concluded that any adjustment of revenue for one particular customer for a refund or any other reason would be insignificant and would not materially impact the Company’s total revenue.  

Investment Commissions – Investment commissions are earned through the sales of non-deposit investment products to customers of the Company.  The sales are conducted through a third-party broker-dealer.  When the commissions are received and recorded into income on the Bank’s income statement, there is no contingent portion that may need to be refunded back to the third party broker dealer.  Investment commissions represent only 1.4% of the Company’s total revenue, and therefore management has concluded that any adjustment of revenue for a particular customer for a refund or any other reason would be insignificant and would not materially impact the Company’s total revenue.  

19

Other – Income items included in “Other” are Bank owned life insurance income, security gains, net gains on the sale of loans and other operating income. There is also a one-time legal settlement of $8.4 million for the three month period ended March 31, 2022.  Any amounts within the scope of ASC 606 are deemed immaterial.

Fair Value:

Fair value is the exchange price that would be received for an asset, or paid to transfer a liability (exit price), in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.  There are three levels of inputs that may be used to measure fair values:

Level 1 – Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2 – Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3 – Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The Company used the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

Investment Securities: The Company uses a third party service to estimate fair value on available for sale securities on a monthly basis.  The Company’s service provider is considered a leading evaluation pricing service for U.S. domestic fixed income securities and values securities using exit pricing requirements.  They subscribe to multiple third-party pricing vendors, and supplement that information with matrix pricing methods.  The fair values for investment securities, which consist of equity securities that are recorded at fair market value to comply with exit pricing, are determined by quoted market prices in active markets, if available (Level 1).  The equity securities change in fair market value is recorded in the income statements.  For securities where quoted prices are not available, fair values are calculated based on quoted prices for similar assets in active markets, quoted prices for similar assets in markets that are not active or inputs other than quoted prices, which provide a reasonable basis for fair value determination.  Such inputs may include interest rates and yield curves, volatilities, prepayment speeds, credit risks and default rates.  Inputs used are derived principally from observable market data (Level 2).  For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3).  The fair values of Level 3 investment securities are determined by using unobservable inputs to measure fair value of assets for which there is little, if any market activity at the measurement date, using reasonable inputs and assumptions based on the best information at the time, to the extent that inputs are available without undue cost and effort.  For the period ended March 31, 2022 and for the year ended December 31, 2021, the fair value of Level 3 investment securities was immaterial.

Derivative Instruments: The fair values of derivative instruments are based on valuation models using observable market data as of the measurement date (Level 2).

Collateral Dependent Loans: Fair value estimates of collateral dependent loans that are individually reviewed are based on the fair value of the collateral, less estimated costs to sell.  Non-collateral dependent loans are valued based on discounted cash flows.  Loans carried at fair value generally receive specific allocations of the allowance for credit losses in the current period and allowance for loan losses in prior periods.  For collateral dependent loans, fair value is commonly based on recent real estate appraisals.  These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach.  Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available.  Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value.  Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification.  These loans are evaluated on a quarterly basis and adjusted accordingly.

Other Real Estate Owned: Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis.  These assets are subsequently accounted for at lower of cost or fair value less estimated costs to sell. Fair values are commonly based on recent real estate appraisals.  These appraisals may use a single valuation approach or a combination of approaches including comparable sales and the income approach.  Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available.  Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value.

20

Appraisals for both collateral-dependent impaired loans and other real estate owned are performed by certified general appraisers (for commercial and commercial real estate properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company.  Once received, a member of the Appraisal Department reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison with independent data sources such as recent market data or industry-wide statistics.  On an annual basis, the Company compares the actual selling price of collateral that has been sold to the most recent appraised value to determine what adjustments should be made to appraisals to arrive at fair value.

Assets measured at fair value on a recurring basis are summarized below:

			Fair Value Measurements at March 31, 2022 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investment securities available-for sale
U.S. Treasury and U.S. government sponsored entities	$	104,947	$	0	$	104,947	$	0
State and political subdivisions		645,608		0		645,608		0
Corporate bonds		4,295		0		4,295		0
Mortgage-backed securities-residential		663,695		0		663,693		2
Collateralized mortgage obligations		40,325		0		40,325		0
Small Business Administration		4,756		0		4,756		0
Equity securities
Equity securities at fair value		217		217		0		0
Other investments measured at net asset value		14,723	n/a		n/a		n/a
Total investment securities	$	1,478,566	$	217	$	1,463,624	$	2
Interest rate swaps	$	2,232	$	0	$	2,232	$	0
Financial Liabilities
Interest rate swaps	$	2,232	$	0	$	2,232	$	0

			Fair Value Measurements at December 31, 2021 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices  in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investment securities available-for sale
U.S. Treasury and U.S. government sponsored entities	$	90,831	$	0	$	90,831	$	0
State and political subdivisions		658,815		0		658,815		0
Corporate bonds		4,030		0		4,030		0
Mortgage-backed securities-residential		655,186		0		655,183		3
Collateralized mortgage obligations		13,385		0		13,385		0
Small Business Administration		5,430		0		5,430		0
Equity securities
Equity securities at fair value		228		228		0		0
Other investments measured at net asset value		14,721	n/a		n/a		n/a
Total investment securities	$	1,442,626	$	228	$	1,427,674	$	3
Interest rate swaps	$	4,261	$	0	$	4,261	$	0
Financial Liabilities
Interest rate swaps	$	4,261	$	0	$	4,261	$	0

There were no significant transfers between Level 1 and Level 2 during the three month period ended March 31, 2022 and 2021.

21

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3):

	Investment Securities Available-for-sale (Level 3)
	Three Months ended March 31,
(In Thousands of Dollars)	2022			2021
Beginning Balance	$	3		$	4
Transfers from level 2		0			0
Repayments, calls and maturities		(1	)		0
Ending Balance	$	2		$	4

Assets measured at fair value on a non-recurring basis are summarized below:

			Fair Value Measurements at March 31, 2022 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices  in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Individually evaluated loans
1–4 family residential	$	82	$	0	$	0	$	82
Consumer indirect		14		0		0		14

			Fair Value Measurements at December 31, 2021 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Individually Evaluated loans
Commercial	$	1,654	$	0	$	0	$	1,654
1–4 family residential		82		0		0		82

Collateral dependent loans were individually evaluated under ASC 326 for the periods ending March 31, 2022 and December 31, 2021.  Collateral dependent loans had a principal balance of $893 thousand with a valuation allowance of $797 thousand at March 31, 2022.  Collateral dependent loans had a principal balance of $3.2 million with a valuation allowance of $1.5 million at December 31, 2021.  Excluded from the above tables at March 31, 2022 and December 31, 2021, are $850 thousand and $792 thousand of loans classified as troubled debt restructurings and measured using the present value of cash flows, which is not considered an exit price.

Collateral dependent commercial real estate loans, both owner-occupied and non-owner occupied are valued by independent external appraisals.  These external appraisals are prepared using the sales comparison approach and income approach valuation techniques.  Management makes subsequent unobservable adjustments to the collateral dependent loan appraisals.  Collateral dependent loans other than commercial real estate and other real estate owned are not considered material.

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at the periods ended March 31, 2022 and December 31, 2021:

March 31, 2022	Fair value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individually evaluated loans
Residential		82	Sales comparison	Adjustment for differences between comparable sales	(3.84%) - 3.22% (0.12%)
Consumer indirect		14	Sales comparison	Adjustment for differences between comparable sales	(6.08%) - 6.08% 0.00%

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December 31, 2021	Fair value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individually evaluated loans
Commercial	$	1,654	Sales comparison	Adjustment for differences between comparable sales	(40.24%) - 56.83% (12.43%)
Residential		82	Sales comparison	Adjustment for differences between comparable sales	(3.84%) - 3.22% (0.12%)

The carrying amounts and estimated fair values of financial instruments not previously disclosed at March 31, 2022 and December 31, 2021 are as follows:

			Fair Value Measurements at March 31, 2022 Using:
(In Thousands of Dollars)	Carrying Amount		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	137,627	$	29,224	$	108,403	$	0	$	137,627
Regulatory stock		19,080	n/a		n/a		n/a		n/a
Loans held for sale		1,904		0		1,942		0		1,942
Loans, net		2,277,956		0		0		2,254,714		2,254,714
Financial liabilities
Deposits		3,693,811		3,283,963		397,903		0		3,681,866
Long-term borrowings		87,872		0		84,946		0		84,946

			Fair Value Measurements at December 31, 2021 Using:
(In Thousands of Dollars)	Carrying Amount		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	112,790	$	29,150	$	83,640	$	0	$	112,790
Regulatory stock		15,510	n/a		n/a		n/a		n/a
Loans held for sale		4,545		0		4,681		0		4,681
Loans, net		2,301,696		0		0		2,285,554		2,285,554
Financial liabilities
Deposits		3,547,235		3,158,967		384,263		0		3,543,230
Long-term borrowings		87,758		0		92,433		0		92,433

The methods and assumptions used to estimate fair value, not previously described, are described as follows:

Cash and Cash Equivalents: The carrying amounts of cash and short-term instruments approximate fair values and are classified as Level 1.

Regulatory Stock: It is not practical to determine the fair value of regulatory stock due to restrictions placed on its transferability.

Loans: Fair values of loans, excluding loans held for sale, are estimated as follows: The Company uses a third party firm that uses cash flow analysis and current market interest rates along with adjustments for credit, liquidity and option risk to conform to the ASU 2016-01 exit price requirement.  Loans in the tables above consist of impaired credits held for investment.  Fair value for collateral dependent loans is based upon appraised values adjusted for trends observed in the market, less estimated cost to sell. The cash flow method is used for estimating fair value for noncollateral dependent loans. A valuation allowance was recorded for the excess of the loan’s recorded investment over the amounts determined by the collateral value method. This valuation is a component of the allowance for credit losses. The Company considers these fair values Level 3.

Loans held for sale: The fair value of loans held for sale is estimated based upon binding contracts and quotes from third party investors resulting in a Level 2 classification.

23

Deposits: The fair values disclosed for demand deposits – interest and non-interest checking, passbook savings, and money market accounts – are, by definition, equal to the amount payable on demand at the reporting date resulting in a Level 1 classification.  The carrying amounts of variable rate certificates of deposit approximate their fair values at the reporting date resulting in a Level 2 classification.  Fair value for fixed rate certificates of deposit are estimated using a discounted cash flows calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities on time deposits resulting in a Level 2 classification.

Short-term Borrowings: The carrying amounts of federal funds purchased, borrowings under repurchase agreements, and other short-term borrowings, generally maturing within ninety days, approximate their fair values resulting in a Level 2 classification.

Long-term Borrowings: The fair values of the Company’s long-term borrowings are estimated using discounted cash flow analyses based on the current borrowing rates for similar types of borrowing arrangements resulting in a Level 2 classification.

Off-balance Sheet Instruments: The fair value of commitments is not considered material.

Goodwill and Intangible Assets:

Goodwill associated with the Company’s acquisition of Cortland in November 2021 and other past acquisitions totaled $94.2 million at March 31, 2022 and December 31, 2021.  Impairment exists when a reporting unit’s carrying value of goodwill exceeds its fair value, which is determined through a two-step impairment test. Management performs goodwill impairment testing on an annual basis as of September 30.  The fair value of the reporting units is determined using a combination of a discounted cash flow method and a guideline public company method.  Results of the assessment indicated no goodwill impairment as of September 30, 2021.  The Company will continue to monitor its goodwill for possible impairment.  

Acquired Intangible Assets

Acquired intangible assets were as follows:

	March 31, 2022					December 31, 2021
(In Thousands of Dollars)	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Amortized intangible assets:
Customer relationship intangibles	$	7,210	$	(6,679	)	$	7,210	$	(6,641	)
Non-compete contracts		430		(393	)		430		(392	)
Trade name		520		(364	)		520		(356	)
Core deposit intangible		12,866		(5,643	)		12,866		(5,271	)
Total	$	21,026	$	(13,079	)	$	21,026	$	(12,660	)

Aggregate amortization expense was $420 thousand for the three month period ended March 31, 2022 and $316 thousand for the three month period ended March 31, 2021.

Estimated amortization expense for each of the next five periods and thereafter:

2022 (9 months)	$	1,251
2023		1,198
2024		894
2025		833
2026		741
Thereafter		3,030
Total	$	7,947

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Leases:

The Company has operating leases for branch office locations, vehicles and certain office equipment such as printers, copiers and faxes. The leases have remaining lease terms of up to 18 years, some of which include options to extend the lease for up to 15 years and some of which include options to terminate the lease in 1.1 years. 

The right of use asset and lease liability were $6.1 million and $6.4 million as of March 31, 2022 and $6.4 million and $6.6 million at December 31, 2021.

Lease payments made for the three month period ended March 31, 2022, were $237 thousand and $202 thousand for the three month period ended March 31, 2021.  Interest expense and amortization expense on finance leases for the three month period ended March 31, 2022, was $38 thousand and $166 thousand.  Interest expense and amortization expense on finance leases for the three month period ended March 31, 2021, was $36 thousand and $121 thousand.  The average remaining lease term for all leases was 5.95 years as of March 31, 2022 and the weighted-average discount rate was 2.43%.

Maturities of lease liabilities are as follows as of March 31, 2022:

2022 (9 months)	$	596
2023		780
2024		610
2025		603
2026		586
Thereafter		4,245
Total Payments		7,420
Less: Imputed Interest		(1,035	)
Total	$	6,385

Derivative Financial Instruments:

Interest Rate Swaps

The Company maintains an interest rate protection program for commercial loan customers. Under this program, the Company provides a variable rate loan while creating a fixed rate loan for the customer by the customer entering into an interest rate swap with terms that match the loan. The Company offsets its risk exposure by entering into an offsetting interest rate swap with an unaffiliated institution. The Company had interest rate swaps associated with commercial loans with a notional value of $74.9 million and fair value of $2.2 million in other assets and $2.2 million in other liabilities at March 31, 2022. At December 31, 2021 the Company had interest rate swaps associated with commercial loans with and a notional value of $86.1 million and fair value of $4.0 million in other assets and $4.0 million in other liabilities. The interest rate swaps with both the customers and third parties are not designated as hedges under FASB ASC 815 and are not marked to market through earnings. As the interest rate swaps are structured to offset each other, changes to the underlying benchmark interest rates considered in the valuation of these instruments do not result in an impact to earnings; however, there may be fair value adjustments related to credit quality variations between counterparties, which may impact earnings as required by FASB ASC 820.

There were no net gains or losses for interest rate swaps for the period ended March 31, 2022 or December 31, 2021.

Mortgage Banking Derivatives

Commitments to fund certain mortgage loans (interest rate locks) to be sold into the secondary market are considered derivatives. These mortgage banking derivatives are not designated in hedge relationships.  The Company had approximately $13.6 million of interest rate lock commitments at March 31, 2022 and $25.7 million of interest rate lock commitments at December 31, 2021.

The net gains and losses on derivative instruments not designated as hedging instruments are included in mortgage banking income.  For the quarter ended March 31, 2022, losses of $286,000 were included in mortgage banking income for the interest rate lock commitments.  For the fiscal year ended December 31, 2021, gains of $423,000 were included in mortgage banking income for the interest rate lock commitments.

25

Earnings Per Share:

The computation of basic and diluted earnings per share is shown in the following table:

	Three Months Ended March 31,
	2022		2021
Basic EPS
Net income (In thousands)	$	15,844	$	14,556
Weighted average shares outstanding		33,820,485		28,215,772
Basic earnings per share	$	0.47	$	0.52
Diluted EPS
Net income (In thousands)	$	15,844	$	14,556
Weighted average shares outstanding for basic earnings per share		33,820,485		28,215,772
Dilutive effect of restricted stock awards		116,453		120,367
Weighted average shares for diluted earnings per share		33,936,938		28,336,139
Diluted earnings per share	$	0.47	$	0.51

There were 132,492 and 68,311 restricted stock awards that were considered anti-dilutive for the three month periods ended March 31, 2022 and 2021, respectively.

Stock Based Compensation:

During 2017, the Company, with the approval of shareholders, created the 2017 Equity Incentive Plan (the “2017 Plan”).  The 2017 Plan permits the award of up to 800 thousand shares to the Company’s directors and employees to attract and retain exceptional personnel, motivate performance and most importantly to help align the interests of the Company’s executives with those of the Company’s shareholders.  There were 75,768 service time based share awards and 56,724 performance based share awards granted under the 2017 Plan during the three month period ended March 31, 2022, as shown in the table below.  The actual number of performance based shares issued will depend on the relative performance of the Company’s average return on equity compared to a group of peer companies over a three year vesting period, ending December 31, 2024.  As of March 31, 2022, 137,383 shares are still available to be awarded from the 2017 Plan.  

In April of 2022, the Company, with the approval of shareholders, approved the 2022 Equity Incentive Plan (the “2022 Plan”).  The 2022 Plan permits the award of up to one million shares to the Company’s directors and employees.  The 2022 Plan will replace the 2017 Plan.

The restricted stock awards were granted with a fair value price equal to the market price of the Company’s common stock at the date of the grant.  Expense recognized was $365 thousand and $330 thousand for the three month periods ended March 31, 2022 and 2021, respectively.  As of March 31, 2022, there was $3.7 million of total unrecognized compensation expense related to the nonvested shares granted under the Plan.  The remaining cost is expected to be recognized over 2.9 years.  

The following is the activity under the Plans during the three month period ended March 31, 2022.

	Maximum Awarded Service Units			Weighted Average Grant Date Fair Value		Maximum Awarded Performance Units			Weighted Average Grant Date Fair Value
Beginning balance - non-vested shares		99,564		$	16.13		158,988		$	14.40
Granted		75,768			17.69		56,724			17.25
Vested		(15,771	)		17.29		(65,481	)		17.48
Forfeited		0			0.00		(12,862	)		14.74
Ending balance - non-vested shares		159,561		$	17.13		137,369		$	15.85

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The following is the activity under the Plans during the three month period ended March 31, 2021.

	Maximum Awarded Service Units			Weighted Average Grant Date Fair Value		Maximum Awarded Performance Units			Weighted Average Grant Date Fair Value
Beginning balance - non-vested shares		67,765		$	14.32		153,070		$	14.46
Granted		19,062			14.36		52,249			14.09
Vested		(13,081	)		14.34		(52,327	)		14.34
Forfeited		(2,000	)		13.55		0			0
Ending balance - non-vested shares		71,746		$	14.35		152,992		$	14.37

The 81,252 shares that vested during the three month period ended March 31, 2022 had a weighted average fair value of $17.44 per share.

Other Comprehensive Income (Loss):

The following tables represent the details of other comprehensive income for the three month periods ended March 31, 2022 and 2021.

	Three Months Ended March 31, 2022
(In Thousands of Dollars)	Pre-tax			Tax		After-Tax
Unrealized holding losses on available-for-sale securities during the period	$	(112,398	)	$	23,605	$	(88,793	)
Reclassification adjustment for gains included in net income (1)		0			0		0
Net unrealized losses on available-for-sale securities	$	(112,398	)	$	23,605	$	(88,793	)
Change in funded status of post-retirement health plan		(2	)		0		(2	)
Net other comprehensive loss	$	(112,400	)	$	23,605	$	(88,795	)
	Three Months Ended March 31, 2021
(In Thousands of Dollars)	Pre-tax			Tax		After-Tax
Unrealized holding losses on available-for-sale securities during the period	$	(14,934	)	$	3,136	$	(11,798	)
Reclassification adjustment for gains included in net income (1)		(383	)		81		(302	)
Net other comprehensive loss	$	(15,317	)	$	3,217	$	(12,100	)

(1) Pre-tax reclassification adjustments relating to available-for-sale securities are reported in security gains and the tax impact is included in income tax expense on the consolidated statements of income.

Regulatory Capital Matters:

Banks and bank holding companies are subject to various regulatory capital requirements administered by the federal banking agencies.  Capital adequacy guidelines and, additionally for banks, prompt corrective action regulations, involve quantitative measures of assets, liabilities, and certain off-balance sheet items calculated under regulatory accounting practices.  Capital amounts and classifications are also subject to qualitative judgments by regulators.  Failure to meet capital requirements can initiate regulatory action by regulators that, if undertaken, could have a direct material effect on the financial statements.  Management believes that as of March 31, 2022, the Company and the Bank meet all capital adequacy requirements to which they are subject.

The FDIC and other federal banking regulators revised the risk-based capital requirements applicable to financial holding companies and insured depository institutions, including the Company and the Bank, to make them consistent with agreements that were reached by the Basel Committee on Banking Supervision (“Basel III”).

The common equity tier 1 capital, tier 1 capital and total capital ratios are calculated by dividing the respective capital amounts by risk-weighted assets.  The leverage ratio is calculated by dividing tier 1 capital by adjusted average total assets.

Basel III limits capital distributions and certain discretionary bonus payments if the banking organization does not hold a “capital conservation buffer” consisting of 2.5% of common equity tier 1 capital, tier 1 capital and total capital to risk-weighted assets in addition to the amount necessary to meet minimum risk-based capital requirements.  Excluding the additional buffer, Basel III requires the Company and the Bank to maintain (i) a minimum ratio of common equity tier 1 capital to risk-weighted assets of at least 4.5%, (ii) a minimum ratio of tier 1 capital to risk-weighted assets of at least 6.0%, (iii) a minimum ratio of total capital to risk-weighted assets of at least 8.0% and (iv) a minimum leverage ratio of at least 4.0%.

27

Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized, although these terms are not used to represent overall financial condition.  If only adequately capitalized, regulatory approval is required to accept brokered deposits.  If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required.  At March 31, 2022 and December 31, 2021, the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for prompt corrective action.  There are no conditions or events since that notification that management believes have changed the institution’s category.

Actual and required capital amounts and ratios, which do not include the capital conservation buffer, are presented below at March 31, 2022 and December 31, 2021:

	Actual					Requirement For Capital Adequacy Purposes:					To be Well Capitalized Under Prompt Corrective Action Provisions:
	Amount		Ratio			Amount		Ratio			Amount		Ratio
March 31, 2022
Common equity tier 1 capital ratio
Consolidated	$	373,543		13.31	%	$	126,292		4.5	%	N/A		N/A
Bank		355,986		12.75	%		125,692		4.5	%		181,555		6.5	%
Total risk based capital ratio
Consolidated		493,558		17.59	%		224,519		8.0	%	N/A		N/A
Bank		383,001		13.71	%		223,452		8.0	%		279,315		10.0	%
Tier 1 risk based capital ratio
Consolidated		391,543		13.95	%		168,389		6.0	%	N/A		N/A
Bank		355,986		12.75	%		167,589		6.0	%		223,452		8.0	%
Tier 1 leverage ratio
Consolidated		391,543		9.56	%		163,860		4.0	%	N/A		N/A
Bank		355,986		8.72	%		163,207		4.0	%		204,009		5.0	%
December 31, 2021
Common equity tier 1 capital ratio
Consolidated	$	362,950		13.16	%	$	124,066		4.5	%	N/A		N/A
Bank		345,065		12.55	%		123,712		4.5	%	$	178,695		6.5	%
Total risk based capital ratio
Consolidated		485,336		17.60	%		220,562		8.0	%	N/A		N/A
Bank		374,451		13.62	%		219,933		8.0	%		274,916		10.0	%
Tier 1 risk based capital ratio
Consolidated		380,950		13.82	%		165,422		6.0	%	N/A		N/A
Bank		345,065		12.55	%		164,950		6.0	%		219,933		8.0	%
Tier 1 leverage ratio
Consolidated		380,950		10.12	%		150,629		4.0	%	N/A		N/A
Bank		345,065		9.19	%		150,217		4.0	%		187,772		5.0	%

Segment Information:

The reportable segments are determined by the products and services offered, primarily distinguished between banking and trust.  These segments are also distinguished by the level of information provided to the chief operating decision makers in the Company, who use such information to review performance of various components of the business, which are then aggregated.  Loans, investments, and deposits provide the revenues in the banking operation.  All operations are domestic.  Significant segment totals are reconciled to the financial statements as follows:

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
March 31, 2022
Goodwill and other intangibles	$	5,796	$	100,654	$	(4,263	)	$	102,187
Total assets	$	19,548	$	4,182,798	$	3,509		$	4,205,855

28

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
December 31, 2021
Goodwill and other intangibles	$	5,814	$	101,055	$	(4,263	)	$	102,606
Total assets	$	14,365	$	4,124,530	$	3,854		$	4,142,749

(In Thousands of Dollars)	Trust Segment		Bank Segment			Eliminations and Others			Consolidated Totals
For Three Months Ended March 31, 2022
Net interest income	$	34	$	31,993		$	(785	)	$	31,242
Provision for credit losses and unfunded loans		0		(358	)		0			(358	)
Service fees, security gains and other noninterest income		9,198		8,741			(241	)		17,698
Noninterest expense		1,769		27,442			83			29,294
Amortization and depreciation expense		28		1,134			0			1,162
Income before taxes		7,435		12,516			(1,109	)		18,842
Income taxes		1,562		1,734			(298	)		2,998
Net income	$	5,873	$	10,782		$	(811	)	$	15,844

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
For Three Months Ended March 31, 2021
Net interest income	$	31	$	25,290	$	(54	)	$	25,267
Provision for credit losses and unfunded loans		0		425		0			425
Service fees, security gains and other noninterest income		2,603		7,514		15			10,132
Noninterest expense		1,556		15,181		(218	)		16,519
Amortization and depreciation expense		64		666		68			798
Income before taxes		1,014		16,532		111			17,657
Income taxes		212		2,947		(58	)		3,101
Net income	$	802	$	13,585	$	169		$	14,556

The Bank segment includes Farmers National Insurance and Farmers of Canfield Investment Co.

Short-term borrowings:

The Bank had no short-term advances from the FHLB at March 31, 2022 or December 31, 2021.

The Bank has access to lines of credit amounting to $35 million at two major domestic banks that are below prime rate. The lines and terms are periodically reviewed by the lending banks and are generally subject to withdrawal at their discretion. There were no borrowings under these lines at March 31, 2022 or at December 31, 2021.

Farmers has two unsecured revolving lines of credit for $6.5 million. These lines can be renewed annually. The lines have interest rates of prime with floors of 3.5% and 4.5%. There were no outstanding balances on either of these two lines at March 31, 2022 or at December 31, 2021, respectively.

Long-term borrowings:

There were no long-term advances from the FHLB at March 31, 2022 or at December 31, 2021.

The Bank’s long-term and short-term FHLB advances are secured by a blanket pledge of residential mortgage, commercial real estate, and multi-family loans totaling $1.3 billion and $1.2 billion at March 31, 2022 and December 31, 2021.  Based on this collateral, the Bank is eligible to borrow an additional $679.8 million at March 31, 2022.  

29

In November 2021, the Company completed the issuance of $75.0 million aggregate principal amount, fixed-to-floating rate subordinated notes due December 15, 2031, in a private offering exempt from the registration requirements under the Securities Act of 1933, as amended.  The notes carry a fixed rate of 3.125% for five years at which time they will convert to a floating rate based on the three-month term secured overnight funding rate, plus a spread of 220 basis points.  The Company may, at its option, beginning December 15, 2026, redeem the notes, in whole or in part, from time to time, subject to certain conditions.  The net proceeds from the sale were approximately $73.8 million, after deducting the offering expenses.  The Company’s intent was to use the proceeds from the sale for general corporate purposes, which may include, without limitation, providing capital to support its growth organically or through acquisitions, in financing investments, capital expenditures, repurchasing its common shares and for investments in the Bank as regulatory capital.  The subordinated debentures are included in Total Capital under current regulatory guidelines and interpretations.

On November 1, 2021, the Company completed its acquisition of Cortland, which included the assumption of Floating Rate Junior Subordinated Debt Securities due in September 15, 2037 (the "junior subordinated debt securities") at an acquisition-date fair value of $4.3 million, held in a wholly-owned statutory trust whose common securities were wholly-owned by Cortland. The sole assets of the statutory trust are the junior subordinated debt securities and related payments. The junior subordinated debt securities and the back-up obligations, in the aggregate, constitute a full and unconditional guarantee of the obligations of the statutory trust under the capital securities held by third-party investors. The securities bear interest at a rate of 1.45% over the 3-month LIBOR rate.  The rate at March 31, 2022 was 2.28% and at December 31, 2021 was 1.65%.

On January 7, 2020, the Company completed its acquisition of Maple Leaf, which included the assumption of Floating Rate Junior Subordinated Debt Securities due December 15, 2036 (the "junior subordinated debt securities") held in a wholly-owned statutory trust whose common securities were wholly-owned by Maple Leaf. The sole assets of the statutory trust are the junior subordinated debt securities and related payments. The junior subordinated debt securities and the back-up obligations, in the aggregate, constitute a full and unconditional guarantee of the obligations of the statutory trust under the capital securities held by third-party investors. The securities bear interest at a rate of 1.70% over the 3-month LIBOR rate.  The rate at March 31, 2022 was 2.63% and at December 31, 2021 was 1.90%.

In 2015, the Company completed its acquisition of National Bancshares Corporation (“NBOH”), which included the assumption of Floating Rate Junior Subordinated Debt Securities due June 15, 2035 (the "junior subordinated debt securities") held in a wholly-owned statutory trust whose common securities were wholly-owned by NBOH. The sole assets of the statutory trust are the junior subordinated debt securities and related payments. The junior subordinated debt securities and the back-up obligations, in the aggregate, constitute a full and unconditional guarantee of the obligations of the statutory trust under the capital securities held by third-party investors. The securities bear interest at a rate of 1.80% over the 3-month LIBOR rate.  The rate at March 31, 2022 was 2.53% and at December 31, 2021 was 2.00%.

In all three instances, the Company may redeem the junior subordinated debentures at any quarter-end, in whole, or in part, at par.  This type of subordinated debenture qualifies as Tier 1 capital for regulatory purposes in determining and evaluating the Company’s capital adequacy.

A summary of all junior subordinated debentures issued by the Company to affiliates and subordinated debentures follows.  For the junior subordinated debentures, these amounts represent the par value of the obligations owed to these affiliates, including the Company’s equity interest in the trusts along with any unamortized fair value marks.  For the subordinated debentures, these amounts represent the par value less the remaining deferred offering expense associated with the issuance of the debentures.  

	March 31, 2022	December 31, 2021
	Amount	Amount
TSEO Statutory Trust I	$2,436	$2,424
Maple Leaf Financial Statutory Trust II	7,349	7,293
Cortland Statutory Trust I	4,285	4,271
Total junior subordinated debentures owed to unconsolidated subsidiary trusts	$14,070	$13,988
Subordinated debentures	$73,802	$73,770

30

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Note Regarding Forward Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements are not statements of historical fact, but rather statements based on the Company’s current expectations, beliefs and assumptions regarding the future of Farmers’ business, future plans and strategies, projections, anticipated events and trends, its intended results and future performance, the economy and other future conditions. Forward-looking statements are preceded by terms such as “will,” “would,” “should,” “could,” “may,” “expect,” “estimate,” “believe,” “anticipate,” “intend,” “plan,” “project,” or variations of these words, or similar expressions. Forward-looking statements are not a guarantee of future performance and actual future results could differ materially from those contained in forward-looking information. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control.  Numerous uncertainties, risks, and changes could cause or contribute to Farmers’ actual results, performance, and achievements to be materially different from those expressed or implied by the forward-looking statements.  

Factors that could cause or contribute to such differences include, without limitation, risks and uncertainties detailed from time to time in the Company’s filings with the Securities and Exchange Commission (the “Commission”), including without limitation, the risk factors disclosed in Item 1A, “Risk Factors,” in the Company’s 2021 Form 10-K, as updated in Item 1A, “Risk Factors,” in this Quarterly Report on Form 10-Q.  

Many of these factors are beyond the Company’s ability to control or predict, and readers are cautioned not to put undue reliance on those forward-looking statements.  The following, which is not intended to be an all-encompassing list, summarizes several factors that could cause the Company’s actual results to differ materially from those anticipated or expected in any forward-looking statement:

• general economic conditions in markets where the Company conducts business, which could materially impact credit quality trends;

• effects of the COVID-19 pandemic on the local, national, and international economy, our organization and employees, and our customers and suppliers and their business operations, financial condition, and including our customers’ ability to repay loans;

• disruptions in the mortgage and lending markets and significant or unexpected fluctuations in interest rates related to COVID-19 and governmental responses, including financial stimulus packages;

• general business conditions in the banking industry;

• the regulatory environment;

• general fluctuations in interest rates;

• demand for loans in the market areas where the Company conducts business;

• rapidly changing technology and evolving banking industry standards;

• competitive factors, including increased competition with regional and national financial institutions;

• new service and product offerings by competitors and price pressures;

• and the regulatory landscape, capital markets, and the response to and management of the COVID-19 pandemic, including the provision of additional economic stimulus from the federal government.

Other factors not currently anticipated may also materially and adversely affect the Company’s results of operations, cash flows and financial position.  There can be no assurance that future results will meet expectations.  While the Company believes that the forward-looking statements in the presentation are reasonable, you should not place undue reliance on any forward-looking statement. In addition, these statements speak only as of the date made.  The Company does not undertake, and expressly disclaims, any obligation to update or alter any statements whether as a result of new information, future events or otherwise, except as may be required by applicable law.

31

Overview

The Company’s results of operations for the quarter ended March 31, 2022 are discussed below.  However, the Company’s past results of operations may not reflect its future operating trends.  In March 2020, the COVID-19 pandemic began to affect the U.S. economy and has created additional uncertainty for the Company’s business.  Regulatory actions in response to the COVID-19 pandemic have varied across jurisdictions and have included some limited closures of nonessential businesses, affecting customers of the Company.  The duration, extent and the effect of the government’s response to the economy is unknown.

The Company’s net income for the three months ended March 31, 2022, was $15.8 million, or $0.47 per diluted share, which compares to $14.6 million, or $0.51 per diluted share, for the three months ended March 31, 2021.  Net income improved as a result of the earnings stream from the Cortland acquisition, while the lower per share results reflect only partial cost savings from the merger integration, with full realization expected for the remainder of 2022.  Annualized return on average assets and annualized return on average equity were 1.52% and 13.89%, respectively, for the three month period ended March 31, 2022, compared to 1.87% and 16.81% for the same three month period in 2021.  

On March 23, 2022, Farmers entered into an agreement and plan of merger with Emclaire Financial Corp. (NASDAQ: EMCF), a Pennsylvania corporation (“Emclaire”), the parent company of The Farmers National Bank of Emlenton (“Emlenton”).  The transaction is subject to receipt of Emclaire shareholder approval and customary regulatory approvals and is expected to close during the second half of 2022.   The transaction will mark the Company’s expansion into Pennsylvania including the attractive Pittsburgh market.  Emclaire operates 19 branches in ten counties throughout western Pennsylvania.  As of March 31, 2022, Emclaire had total assets of $1.1 billion, gross loans of $794.9 million, deposits of $936.0 million and equity of $86.7 million. 

Total loans were $2.30 billion at March 31, 2022 compared to $2.33 billion at December 31, 2021.  Gross loans declined $26.1 million for the quarter but excluding the run off in PPP balances during the quarter the decline was $12.4 million.  At March 31, 2022, the Company has $23.2 million of PPP loans and $672 thousand in net deferred fees associated with these loans still to be recognized into income.  Average loans now comprise 58.8% of the Bank's first quarter average earning assets at March 31, 2022, compared to 69.2% for the same period in 2021.

Non-performing assets to total assets remain at a low level, currently at 0.33%.  Early stage delinquencies, which are loans 30 - 89 days delinquent, also continue to remain at low levels, at $7.3 million, or 0.32% of total loans, at March 31, 2022.  Net charge-offs for the current quarter were $1.4 million, compared to $84 thousand in the same quarter in 2021 and net charge-offs as a percentage of average net loans outstanding is only 0.25% for the quarter ended March 31, 2022, compared to 0.02% in the same quarter in 2021.  

Due to a decline in loan balances, a decrease in a specific reserve on one loan, and a continued decline in historical loss ratios, the Company recorded a negative provision for credit losses of $930 thousand for the quarter ended March 31, 2022, compared to the $425 thousand of loan loss provision recorded in the first quarter of 2021.  This was offset somewhat by an increase in the provision for unfunded loans which totaled $527 thousand.  As an overall percentage of loans, the allowance for credit losses decreased to 1.17% for the current quarter compared to 1.22% for the quarter ended March 31, 2021.  

The net interest margin for the three months ended March 31, 2022, was 3.27%, a 27 basis point decrease from the quarter ended March 31, 2021.  In comparing the first quarter of 2022 to the same period in 2021, asset yields decreased 41 basis points, while the cost of interest-bearing liabilities decreased 18 basis points.  Most of the decrease in the asset yields was the result of employing excess liquidity into lower yielding investment securities in the absence of loan growth and a decrease in PPP income compared to the same quarter a year ago.

32

Results of Operations The following is a comparison of selected financial ratios and other results at or for the three month period ended March 31, 2022 and 2021:

	At or for the Three Months Ended March 31,
(In Thousands, except Per Share Data)	2022			2021
Total assets	$	4,205,855		$	3,324,524
Net income	$	15,844		$	14,556
Diluted earnings per share	$	0.47		$	0.51
Return on average assets (annualized)		1.52	%		1.87	%
Return on average equity (annualized)		13.89	%		16.81	%
Efficiency ratio (tax equivalent basis) (1)		61.36	%		48.24	%
Equity to asset ratio		9.37	%		10.45	%
Dividends to net income		34.18	%		21.35	%
Net loans to assets		54.16	%		60.53	%
Loans to deposits		62.40	%		71.92	%

(1) The ratio is calculated by dividing noninterest expenses by the sum of net interest income and noninterest income.  The Company strives for a lower efficiency ratio.  This efficiency ratio measure is not required by any regulatory agency but provides meaningful information to management and investors since a lower ratio indicates the Company is using their assets more effectively to generate profits.  

Net Interest Income. The following schedule details the various components of net interest income for the periods indicated.  All asset yields are calculated on a tax-equivalent basis where applicable.  Security yields are based on amortized cost.

33

Average Balance Sheets and Related Yields and Rates

(Dollar Amounts in Thousands)

	Three Months Ended								Three Months Ended
	March 31, 2022								March 31, 2021
	AVERAGE								AVERAGE
	BALANCE			INTEREST		RATE (1)			BALANCE			INTEREST		RATE (1)
EARNING ASSETS
Loans (3) (4)	$	2,312,712		$	25,646		4.44	%	$	2,054,925		$	23,900		4.72	%
Taxable securities (2)		1,007,963			4,587		1.82			329,903			1,719		2.11
Tax-exempt securities (2) (4)		461,793			3,726		3.23			282,044			2,613		3.76
Other investments		31,122			130		1.67			14,840			121		3.31
Federal funds sold and other		117,916			48		0.16			287,323			71		0.11
TOTAL EARNING ASSETS		3,931,506			34,137		3.47			2,969,035			28,424		3.88
NONEARNING ASSETS
Cash and due from banks		28,772								20,275
Premises and equipment		37,573								25,578
Allowance for loan losses		(29,008	)							(25,336	)
Unrealized gains (losses) on securities		(17,673	)							24,498
Other assets		227,448								141,645
TOTAL ASSETS	$	4,178,618							$	3,155,695
INTEREST-BEARING LIABILITIES
Time deposits	$	378,675		$	643		0.68	%	$	440,452		$	1,255		1.16	%
Brokered time deposits		15,555			15		0.39			32,000			46		0.58
Savings deposits		843,371			167		0.08			495,832			193		0.16
Demand deposits		1,412,291			419		0.12			1,083,597			732		0.27
Short term borrowings		2,222			1		0.18			2,808			4		0.58
Long term borrowings		87,798			792		3.61			76,007			293		1.56
TOTAL INTEREST-BEARING LIABILITIES		2,739,912			2,037		0.30			2,130,696			2,523		0.48
NONINTEREST-BEARING LIABILITIES AND STOCKHOLDERS' EQUITY
Demand deposits		956,499								650,588
Other liabilities		26,001								23,221
Stockholders' equity		456,206								351,190
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	4,178,618							$	3,155,695
Net interest income and interest rate spread				$	32,100		3.17	%				$	25,901		3.40	%
Net interest margin							3.27	%							3.54	%

(1) Rates are calculated on an annualized basis.

(2) Includes unamortized discounts and premiums.  Average balance and yield are computed using the average historical amortized cost.

(3) Interest on loans includes fee income of $1.5 million and $2.8 million for 2022 and 2021, respectively, and is reduced by amortization of $662 thousand and $687 thousand for 2022 and 2021, respectively.

(4) For 2022, adjustments of $84 thousand and $774 thousand, respectively, are made to tax equate income on tax exempt loans and tax exempt securities.  For 2021, adjustments of $95 thousand and $539 thousand, respectively, are made to tax equate income on tax exempt loans and tax exempt securities.  These adjustments are based on a marginal federal income tax rate of 21%, less disallowances.

34

Net Interest Income.  Net interest income for the three month period ended March 31, 2022, was $31.2 million compared to $25.3 million for the same period in 2021.  The increase in net interest income was driven by an increase in interest earning assets, including the acquisition of Cortland Bancorp (“Cortland”), offset by a decline in the net interest margin.  The net interest margin decreased 27 basis points to 3.27% for the three months ended March 31, 2022, compared to 3.54% for the same three month period in the prior year.  In comparing the quarters ended March 31, 2022 and 2021, yields on earning assets decreased 41 basis points, while the cost of interest bearing liabilities decreased 18 basis points. Most of the decrease in the asset yields was the result of employing excess liquidity into lower yielding investment securities in the absence of loan growth, the acquisition of Cortland and a decrease in PPP income compared to the same quarter a year ago.

Noninterest Income. Noninterest income increased to $17.7 million for the first quarter of 2022 compared to $10.1 million for the quarter ended March 31, 2021.    The first quarter of 2022 increased over the same period in 2021 primarily due to $8.4 million in legal settlement income offset by a decline in net security gains of $499 thousand, or 102.3%, and a decline in net gains on the sale of loans of $1.8 million, or 61.1%.  The net gain on sale of loans has declined because of lower origination volumes due to increasing rates along with tighter gain on sale margins.  Other categories of noninterest income that increased year over year include service charges on deposit accounts of $337 thousand, or 41.7%, bank owned life insurance of $125 thousand, or 44.0%, trust fees of $283 thousand, or 12.7%, investment commissions of $190 thousand, or 37.7% and debit card and EFT fees of $245 thousand, or 20.9%.  Much of the increases in these categories was due to the acquisition of Cortland.

Noninterest Expense.  Total noninterest expense for the quarter ended March 31, 2022 was $30.5 million compared to $17.3 million in the first quarter of 2021.  The increase in expense year over year was due to the Company making a charitable contribution of $6.0 million to the Farmers Charitable Foundation, $2.1 million in legal expense associated with the legal settlement and $1.9 million in merger expense incurred in the first quarter of 2022.  The increase in the other categories of noninterest expense, year over year, was due to the Cortland acquisition which closed on November 1, 2021.  The system conversion for Cortland also didn’t take place until late February so the Company did not have a full quarter of cost savings in place for the first quarter of 2022.  The efficiency ratio for the quarter ended March 31, 2022 was 61.4% compared to 47.8% for the same quarter in 2021.  

Income Taxes. Income tax expense totaled $3.0 million for the quarter ended March 31, 2022, and $3.1 million for the quarter ended March 31, 2021.  The effective tax rate for the three month period ended March 31, 2022 and 2021 was 15.9% and 17.6%, respectively.

Financial Condition

Cash and Cash Equivalents.  Cash and cash equivalents increased $24.8 million during the first three months of 2022 from $112.8 million to $137.6 million.  

Securities.  Securities available-for-sale increased by $35.9 million since December 31, 2021 as the Company continued purchasing securities in the first quarter of 2022 in order to utilize excess cash on hand.  Offsetting these purchases, the gross unrealized gain of $11.7 million on available for sale securities at December 31, 2021 declined to a gross unrealized loss of $100.7 million at March 31, 2022 due to the rise in U.S. treasury rates during the first quarter.

Loans.  Gross loans (excluding loans held for sale) were $2.30 billion at March 31, 2022, compared to $2.33 billion at December 31, 2021.  Gross loans declined $26.1 million for the quarter but excluding the run off in PPP balances during the quarter the decline was $12.4 million.  At March 31, 2022, the Company has $23.2 million of PPP loans before deferred fees still to be forgiven, and $672 thousand in net deferred fees associated with these loans still to be recognized into income.  

Allowance for Loan Losses.  The following table indicates key asset quality ratios that management evaluates on an ongoing basis.  The recorded investment balances were used in the calculations.

35

Asset Quality History

(In Thousands of Dollars)

	3/31/2022			12/31/2021			9/30/2021			6/30/2021			3/31/2021
Nonperforming loans	$	14,046		$	16,195		$	14,744		$	13,873		$	11,640
Nonperforming loans as a % of total loans		0.61	%		0.69	%		0.78	%		0.71	%		0.57	%
Loans delinquent 30-89 days	$	7,304		$	8,891		$	6,944		$	7,606		$	7,183
Loans delinquent 30-89 days as a % of total loans		0.32	%		0.38	%		0.37	%		0.39	%		0.35	%
Allowance for credit losses	$	27,015		$	29,386		$	23,136		$	24,806		$	24,935
Allowance for credit losses as a % of loans		1.17	%		1.26	%		1.22	%		1.27	%		1.22	%
Allowance for credit losses as a % of nonperforming loans		192.33	%		181.45	%		156.92	%		178.81	%		214.22	%
Annualized net charge-offs to average net loans outstanding		0.25	%		0.06	%		0.06	%		0.04	%		0.02	%
Non-performing assets	$	14,046		$	16,195		$	14,744		$	13,903		$	11,670
Non-performing assets as a % of total assets		0.33	%		0.39	%		0.44	%		0.43	%		0.35	%
Net charge-offs for the quarter	$	1,441		$	313		$	286		$	179		$	84

Due to a decline in loan balances, a decrease in a specific reserve on one loan, and a continued decline in historical loss ratios, the Company recorded a negative provision for credit losses of $930 thousand for the quarter ended March 31, 2022, compared to the $425 thousand of loan loss provision recorded in the first quarter of 2021.  The Company estimates the ACL based on the amortized cost basis of the underlying loan and has made an accounting policy election to exclude accrued interest from the loan’s amortized cost basis and the related measurement of the ACL.  Estimating the amount of the ACL is a function of a number of factors, including but not limited to changes in the loan portfolio, net charge-offs, trends in past due and nonaccrual loans, and the level of potential problem loans, all of which may be susceptible to significant change. The allowance for credit losses as a percentage of the total loan portfolio was 1.17% at March 31, 2022 and 1.22% at March 31, 2021.  Early stage delinquencies, which are loans 30 - 89 days delinquent, as a percentage of total loans decreased from 0.35% at March 31, 2021, to 0.32% at March 31, 2022, and non-performing loans as a percentage of total loans increased from 0.57% at March 31, 2021, to 0.61% at March 31, 2022.  The allowance for credit losses to non-performing loans decreased from 214.22% at March 31, 2021, to 192.33% at March 31, 2022.

Based on the evaluation of the adequacy of the allowance for credit losses, management believes that the allowance for credit losses at March 31, 2022, is adequate.  The provision for credit losses is based on management’s judgment after taking into consideration all factors connected with the collectability of the existing loan portfolio.  Management estimates the allowance balance using relevant available information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts.  Historical credit loss experience provides the basis for the estimation of expected credit losses.  Specific factors considered by management in determining the amounts charged to operating expenses include previous credit loss experience, the status of past due interest and principal payments, the quality of financial information supplied by loan customers and the general condition of the industries in the community to which loans have been made.

Deposits.  Total deposits increased $146.6 million from December 31, 2021, to March 31, 2022, for a balance of $3.69 billion.  The increase of $146.6 million since December 31, 2021 is due to seasonality in public fund balances and continued growth in business and consumer deposits.  In addition, the Company added $40.0 million in brokered deposits during the quarter.

Borrowings.  Total borrowing balances increased from $87.8 million at December 31, 2021 to $87.9 million at March 31, 2022.  

Capital Resources.  Total stockholders’ equity decreased $78.5 million, or 16.6%, during the three month period ended March 31, 2022.  The decrease in stockholders’ equity was primarily due to an $88.8 million decline in accumulated other comprehensive income and dividends paid to shareholders offset by net income for the quarter.  The rapid increase in U.S. treasury rates has had a negative effect on the value of the Company’s available for sale securities, and in turn, the dollar amount that flows through accumulated other comprehensive income.  Shareholders received $0.16 per share in cash dividends in the first quarter of 2022. Book value per share decreased from $13.94 per share at December 31, 2021 to $11.58 per share at March 31, 2022.  

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The capital management function is a regular process that consists of providing capital for both the current financial position and the anticipated future growth of the Company.  At March 31, 2022 the Company is required to maintain 4.5% common equity tier 1 to risk weighted assets excluding the conservation buffer to be adequately capitalized.  The Company’s common equity tier 1 to risk weighted assets was 13.31%, total risk-based capital ratio stood at 17.59%, and the Tier 1 risk-based capital ratio and Tier 1 leverage ratio were at 13.95% and 9.56%, respectively, at March 31, 2022.  The Company opted not to phase in, over 3 years, the effects of the initial CECL entry to equity for the implementation of ACS 326, recorded on January 1, 2021.  Management believes that the Company and the Bank meet all capital adequacy requirements to which they are subject, as of March 31, 2022.

Federal bank regulatory agencies finalized a rule that simplifies capital requirements for community banks by allowing them to adopt a simple leverage ratio to measure capital adequacy.  The community bank leverage ratio framework removes requirements for calculating and reporting risk-based capital ratios for a qualifying community bank that opts into the framework. 

Critical Accounting Policies

The Company follows financial accounting and reporting policies that are in accordance with U.S. GAAP. These policies are presented in Note 1 of the consolidated audited financial statements in the Company’s Annual Report to Shareholders included in the Company’s 2021 Form 10-K.  Critical accounting policies are those policies that require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.  The Company has identified three accounting policies that are critical accounting policies and an understanding of these policies is necessary to understand the Company’s financial statements.  These policies relate to determining the adequacy of the allowance for credit losses, for both the investment and loan portfolios and if there is any impairment of goodwill or other intangible.  Additional information regarding these policies is included in the notes to the aforementioned 2021 consolidated financial statements, Note 1 (Summary of Significant Accounting Policies), Note 2 (Business Combinations), Note 4 (Loans), and the sections captioned “Loan Portfolio.”

Securities classified as AFS are those securities that the Company intends to hold for an indefinite period of time, but not necessarily to maturity.  Any decision to sell a security classified as AFS would be based on various factors, including significant movements in interest rates, changes in the maturity mix of the Company’s assets and liabilities, liquidity needs, regulatory capital considerations, and other similar factors.

The Company evaluates securities AFS in unrealized loss positions on a quarterly basis to determine whether the decline in fair value below the amortized costs basis (impairment) is due to credit-related factors or noncredit-related factors.  In making this evaluation, management considers the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of the Company to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value.  Any impairment that is not credit-related is recognized in other comprehensive income, net of related deferred income taxes.  Credit-related impairment is recognized as an allowance for credit losses (“ACL”) on the balance sheet based on the amount by which the amortized cost basis exceeds the fair value, with a corresponding charge to net income.  Both the ACL and the charge to net income may be reversed if conditions change. However, if the Company intends to sell an impaired AFS security or more likely than not will be required to sell such a security before recovering its amortized cost basis, the entire impairment amount must be recognized in net income with a corresponding adjustment to the security’s amortized cost basis rather than through the establishment of an ACL.  The Company has recorded no ACL related to the investment portfolio as of March 31, 2022.

The ACL represents management’s estimate of expected credit losses in the Company’s loan portfolio at the balance sheet date.  The Company estimates the ACL based on the amortized cost basis of the underlying loan and has made an accounting policy election to exclude accrued interest from the loan’s amortized cost basis and the related measurement of the ACL.  Estimating the amount of the ACL is a function of a number of factors, including but not limited to changes in the loan portfolio, net charge-offs, trends in past due and nonaccrual loans, and the level of potential problem loans, all of which may be susceptible to significant change.  

Liquidity

The Company maintains, in the opinion of management, liquidity sufficient to satisfy depositors’ requirements and meet the credit needs of customers.  The Company depends on its ability to maintain its market share of deposits as well as acquiring new funds.  The Company’s ability to attract deposits and borrow funds depends in large measure on its profitability, capitalization and overall financial condition.  The Company’s objective in liquidity management is to maintain the ability to meet loan commitments, purchase securities or to repay deposits and other liabilities in accordance with their terms without an adverse impact on current or future earnings.  Principal sources of liquidity for the Company include assets considered relatively liquid, such as federal funds sold, cash-due from banks, as well as cash flows from maturities and repayments of loans, and securities.

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Along with its liquid assets, the Bank has additional sources of liquidity available which help to ensure that adequate funds are available as needed.  These other sources include, but are not limited to, access to funds in the wholesale arena, the ability to obtain deposits through the adjustment of interest rates and the purchasing of federal funds and borrowings on approved lines of credit at major domestic banks.  At March 31, 2022, this line of credit totaled $35 million of which the Bank had not borrowed against.  In addition, the Company has two revolving lines of credit with correspondent banks totaling $6.5 million. There was no balance on these lines at March 31, 2022 and December 31, 2021.  Management feels that its liquidity position is adequate and continues to monitor the position on a monthly basis.  As of March 31, 2022, the Bank had no outstanding balances with the Federal Home Loan Bank but had additional borrowing capacity of approximately $679.8 million, as well as access to the Federal Reserve Discount Window, which provides an additional source of funds with the posting of collateral.  The Bank views its membership in the FHLB as a solid source of liquidity.  

Off-Balance Sheet Arrangements

In the normal course of business, to meet the financial needs of our customers, we are a party to financial instruments with off-balance sheet risk.  These financial instruments generally include commitments to originate mortgage, commercial and consumer loans, and involve to varying degrees, elements of credit and interest rate risk in excess of amounts recognized in the Consolidated Balance Sheets.  The Bank’s maximum exposure to credit loss in the event of nonperformance by the borrower is represented by the contractual amount of those instruments.  Because some commitments may expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements.  The same credit policies are used in making commitments as are used for on-balance sheet instruments.  Collateral is required in instances where deemed necessary.  Undisbursed balances of loans closed include funds not disbursed but committed for construction projects.  Unused lines of credit include funds not disbursed, but committed for, home equity, commercial and consumer lines of credit.  Financial standby letters of credit are conditional commitments issued to guarantee the performance of a customer to a third party.  Those guarantees are primarily used to support public and private borrowing arrangements.  The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers.  Total unused commitments were $627.9 million at March 31, 2022, and $606.8 million at December 31, 2021.  Additionally, the Company committed up to $17.2 million in subscriptions in Small Business Investment Company investment funds.  At March 31, 2022, the Company has invested $15.3 million in these funds.

Recent Market and Regulatory Developments

Various and significant legislation affecting financial institutions and the financial industry is from time to time introduced in the U.S. Congress and state legislatures, as well as by regulatory agencies.  Such initiatives may include proposals to expand or contract the powers of bank holding companies and depository institutions or proposals to substantially change the financial institution regulatory system.  

Also, such statutes, regulations and policies are continually under review by Congress, state legislatures and federal and state regulatory agencies and are subject to change at any time, particularly in the current economic and regulatory environment.  Any such change in statutes, regulations or regulatory policies applicable to the Company could have a material effect on the business of the Company.

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Item 3. Quantitative and Qualitative Disclosures about Market Risk  

The Company’s ability to maximize net income is dependent, in part, on management’s ability to plan and control net interest income through management of the pricing and mix of assets and liabilities.  Because a large portion of assets and liabilities of the Company are monetary in nature, changes in interest rates and monetary or fiscal policy affect its financial condition and can have significant impact on the net income of the Company.

The Company considers the primary market exposure to be interest rate risk.  Simulation analysis is used to monitor the Company’s exposure to changes in interest rates, and the effect of the change to net interest income.  The following table shows the effect on net interest income and the net present value of equity in the event of a sudden and sustained 300 basis point increase or 100 basis point decrease in market interest rates:

Changes In Interest Rate (basis points)	March 31, 2022 Result			December 31, 2021 Result			ALCO Guidelines
Net Interest Income Change
+300		3.2	%		4.5	%		-10.0	%
+200		2.3	%		3.2	%		-7.5	%
+100		1.0	%		1.5	%		-5.0	%
-100		-3.0	%		-4.1	%		-5.0	%
Net Present Value Of Equity Change
+300		2.7	%		6.2	%		-10.0	%
+200		3.5	%		7.6	%		-7.5	%
+100		2.9	%		6.1	%		-5.0	%
-100		-8.8	%		-12.4	%		-10.0	%

It should be noted that the change in the net present value of equity and net interest income had exceeded policy when the simulation model assumed a sudden decrease in rates of 100 basis points (1%).  This was primarily due to the positive impact on the fair value of assets not being as great as the negative impact on the fair value of certain liabilities.  Specifically, because core deposits typically bear relatively low interest rates, their fair value would be negatively impacted as the rates could not be adjusted by the full extent of the sudden decrease in rates.  Management will continue to monitor any policy exceptions and may consider changes to the asset/liability position in the future.  The results of the simulations indicate that interest rate change results fall within internal limits established by the Company at March 31, 2022.  A report on interest rate risk is presented to the Board of Directors and the Asset/Liability Committee on a quarterly basis.  It is management’s opinion that hedging instruments currently available are not a cost effective means of controlling interest rate risk for the Company. Accordingly, the Company does not currently use financial derivatives, such as interest rate options, swaps, caps, floors or other similar instruments, but does utilize swaps to accommodate large commercial borrowers that desire longer term fixed rates.

Item 4. Controls and Procedures

Based on their evaluation, as of the end of the period covered by this Quarterly Report on Form 10-Q, the Company’s Chief Executive Officer and Chief Financial Officer have concluded the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934) are effective.  There were no changes in the Company’s internal controls over financial reporting (as defined in Rule 13a–15(f) under the Exchange Act) that occurred during the fiscal quarter ended March 31, 2022, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings

The Company is a defendant in lawsuits and other adversary proceedings arising in the ordinary course of business.  Legal costs incurred in connection with the resolution of claims and lawsuits are generally expensed as incurred, although the Company establishes accruals where losses are deemed probable and reasonably estimable.  The Company’s assessment of the current exposure with respect to adverse claims in legal matters could change in the event of the discovery of additional facts in such matters or upon determinations by judges, juries, administrative agencies or other finders of fact that are inconsistent with the Company’s evaluation of claims. It is possible that the ultimate resolution of matters, if unfavorable, may be material to the results of operations in a particular future period as the time and amount of any resolution of such actions and its relationship to the future results of operations are not known.

Item 1A. Risk Factors

For a discussion of risk factors related to the Company, refer to Part 1, Item 1A, “Risk Factors,” contained in the Company’s Annual

Report on Form 10-K for the year ended December 31, 2021.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of equity securities by the issuer.

In 2019, the Company announced that its Board of Directors authorized the purchase of up to 1,500,000 shares of its common stock in the open market or in privately negotiated transactions, from time to time and subject to market and other conditions.  At March 31, 2022, the Company had 546,182 shares remaining to be repurchased under this program.  There were no treasury stock shares repurchased under the program during the three month period ended March 31, 2022.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Not applicable.

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Item 6. Exhibits

The following exhibits are filed or incorporated by reference as part of this report:

2.1*	Agreement and Plan of Merger by and among Farmers National Banc Corp., Cortland Bancorp, and FMNB Merger Subsidiary IV, LLC, dated as of June 22, 2021 (incorporated by reference from Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the Commission on June 23, 2021).
2.2*	Amendment to Agreement and Plan of Merger by and among Farmers National Banc Corp., Cortland Bancorp, and FMNB Merger Subsidiary IV, LLC, dated as of October 12, 2021 (incorporated by reference from Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the Commission on June 18, 2021).
2.3*	Agreement and Plan of Merger by and among Farmers National Banc Corp., Emclaire Financial Corp., and FMNB Merger Subsidiary V, LLC, dated as of March 23, 2022 (incorporated by reference from Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the Commission on March 24, 2022).
3.1*	Articles of Incorporation of Farmers National Banc Corp., as amended (incorporated by reference from Exhibit 4.1 to the Company’s Registration Statement on Form S-3 filed with the Commission on October 3, 2001 (File No. 333-70806)).
3.2*	Amendment to Articles of Incorporation of Farmers National Banc Corp., as amended (incorporated by reference from Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Commission on May 1, 2013).
3.3*	Amendment to Articles of Incorporation of Farmers National Banc Corp., as amended (incorporated by reference from Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Commission on April 20, 2018).
3.4*	Amended Code of Regulations of Farmers National Banc Corp. (incorporated by reference from Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Commission on April 17, 2020).
10.1**	Farmers National Banc Corp. 2022 Form of Notice of Grant of Long-term Incentive Plan Awards under 2017 Equity Incentive Plan (filed herewith).
10.2**	Farmers National Banc Corp. 2022 Form of Performance-based Equity Award under 2017 Equity Incentive Plan (filed herewith).
10.3**	Farmers National Banc Corp. 2022 Form of Service-based Restricted Stock Award under 2017 Equity Incentive Plan (filed herewith).
10.4**	Farmers National Banc Corp. 2022 Form of Performance-based Cash Award under 2017 Equity Incentive Plan (filed herewith).
10.5**	Farmers National Banc Corp. 2022 Equity Incentive Plan (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on April 22, 2022).
31.1**	Rule 13a-14(a)/15d-14(a) Certification of Kevin J. Helmick, President and Chief Executive Officer of the Company (principal executive officer) (filed herewith).
31.2**	Rule 13a-14(a)/15d-14(a) Certification of A. Troy Adair, Executive Vice President, Chief Financial Officer and Secretary of the Company (principal financial officer) (filed herewith).
32.1**	Certification pursuant to 18 U.S.C. Section 1350 of Kevin J. Helmick, President and Chief Executive Officer of the Company (principal executive officer) (filed herewith).
32.2**	Certification pursuant to 18 U.S.C. Section 1350 of A. Troy Adair, Executive Vice President, Chief Financial Officer and Secretary of the Company (principal financial officer) (filed herewith).
101	The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2022, formatted in iXBRL (Inline Extensible Business Reporting Language), filed herewith: (i) the Consolidated Balance Sheets; (ii) the Consolidated Statements of Income; (iii) the Consolidated Statements of Comprehensive Income; (iv) the Consolidated Statements of Stockholders’ Equity, (v) the Consolidated Statements of Cash Flows; and (vi) Notes to Unaudited Consolidated Financial Statements.
104	The cover page from the Company’s Quarterly report on Form 10-Q for the quarter ended March 31, 2022, has been formatted in Inline XBRL.

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* Pursuant to Item 601(a)(5) of Regulation S-K, certain schedules and similar attachments have been omitted. The registrant hereby agrees to furnish a copy of any omitted schedule or similar attachment to the SEC upon request.

** Constitutes a management contract or compensatory plan or arrangement.

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SIGNATURES

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.

FARMERS NATIONAL BANC CORP.

Dated: May 5, 2022

/s/ Kevin J. Helmick

Kevin J. Helmick

President and Chief Executive Officer

Dated: May 5, 2022

/s/ A. Troy Adair

A. Troy Adair

Executive Vice President, Chief Financial Officer and Secretary

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EX-10.1

Exhibit 10.1

Notice of Grant of

Restricted Stock Award,

Performance-based Equity Award, and

Performance-based Cash Award

Name

Address

City, State Zip

Subject to the terms and conditions of the 2017 Equity Incentive Plan and the Farmers National Banc Corp. Long-Term Incentive Plan (the “Plans”) and the accompanying Restricted Stock Award Agreement, Performance-based Equity Award Agreement, and Performance-based Cash Award Agreement (the “Award Agreements”), you have been granted Shares of Restricted Stock, Performance-based Shares, and a Performance-based Cash Award (collectively, the “Awards”) as follows:

Grant Date:	February , 2022
Number of Shares:	Your Awards consist of the following: Shares of Restricted Stock 1 Performance-based Shares 2 $ __Target Performance-based Cash 3
Vesting Schedule:	Your Awards of Shares of Restricted Stock, Performance-based Shares, and Performance-based Cash will be subject to vesting on February , 2025 (Normal Vesting Date).
Settlement:	Your Awards will be settled in Shares or Cash, depending on the Award, as described in the respective Award Agreements.

This Notice of Grant and the accompanying Award Agreements describe your Awards and the terms and conditions of your Awards.  To ensure you fully understand these terms and conditions, you should:

• Read the Plan carefully to ensure you understand how the Plans work; and

• Read this Notice of Grant and corresponding Award Agreement carefully to ensure you understand the nature of your Award and what you must do to earn it.  

You may contact Mark Nicastro by telephone (330-533-5025) or email (mnicastro@farmersbankgroup.com) if you have any questions about your Award or Award Agreement.

¹  Number of Shares of Restricted Stock were determined by multiplying $____ (the dollar amount used to determine your total target Awards) by .25, and dividing the result by $____ (the average reported closing price of a Share during the 30-day period ending on the last trading day prior to the Grant Date). The resulting number of Shares were rounded to the nearest whole Share.

²  Number of Performance-based Shares were determined by multiplying $____ by .5, dividing the result by $___ (to determine the target number of Performance-based Shares), and multiplying the result by 2 (to determine the maximum number of Performance-based Shares). The resulting number of Performance-based Shares were rounded to the nearest whole Share.

³  Your target Performance-based Cash Award was determined by multiplying $____ by .25.

EX-10.2

Exhibit 10.2

FARMERS NATIONAL BANC CORP.

PERFORMANCE-BASED EQUITY AWARD AGREEMENT

(2022)

Farmers National Banc Corp. (the “Company”) hereby grants the undersigned Participant an Award pursuant to the Farmers National Banc Corp. 2017 Equity Incentive Plan (the “Equity LTI Plan”) as evidenced by the Notice of Grant accompanying this Award Agreement (the “Grant Notice”), and as further described in this Award Agreement (this “Award Agreement”).

1. Nature of Award.  Effective as of the date specified in the Grant Notice (the “Grant Date”), the Company hereby grants to the individual identified in the Grant Notice (the “Participant”) the award as set forth in the Grant Notice (the “Award”).  The Award is subject to the terms and conditions described in the Equity LTI Plan, this Award Agreement and the Grant Notice.

2. Performance Period:  The three-year period beginning January 1, 2022 and ending on December 31, 2024 (the “Performance Period”).

3. Target Equity Award as Percentage of Base Compensation: ____% x .50 (the “Target Performance-Based Equity Award”).

4. Earning an Award:  The Participant shall be eligible to receive a benefit in Company common shares equal in value based on the Grant Date between 0% and 200% of the Target Performance-BasedEquity Award, based on achievement during the Performance Period of the Performance Objective set forth below. Performance between two stated levels will be interpolated when determining the percentage of the Target Performance-BasedEquity Award earned.

The amount of the Target Performance-Based Equity Award that may be earned in Company common shares will be based on the sum of the Company’s return on equity for each fiscal year during the Performance Period divided by three (“Average ROE”), compared to the Average ROE of the Company’s Peer Group during the Performance Period (“Relative Average ROE”).  The total, maximum number of ROE Award Shares described in the Grant Notice eligible to be earned was determined by (i) dividing the dollar amount of Participant’s Target Performance-Based Equity Award by the average reported closing price of a share of Company common stock during the 30-day period ending on the day prior to the Grant Date of this Award, and (ii) multiplying the result by 200% (x 2.0), rounded to the nearest whole share.  Therefore, between 0% and 100% of the ROE Award Shares are subject to vesting on the “Normal Vesting Date” stated in the Grant Notice, in accordance with the following schedule and percentages:

Performance Objective: Relative Average ROE during Performance Period	Percentage of Average ROE Award Shares Earned
Less than Peer Group 25th percentile	0%
Equal to Peer Group 25th percentile (threshold)	10%
Equal to Peer Group 50th percentile (target)	50%
Equal to or higher than Peer Group 75th percentile (max)	100%

For these purposes: (i) Relative Average ROE shall be determined by the Committee in its sole discretion; and (ii) the Committee shall select the institutions constituting, and make such periodic adjustments as it determines appropriate to, the “Peer Group” in its sole discretion.

5. Payment of Award:  With respect to the Performance Period, the Committee shall certify the level of achievement of the Performance Objective set forth in Section 4 and determine the amount payable with respect to your Award based on such level of achievement. Payment of the Award shall be made to the Participant on the Normal Vesting Date in the form of a number of Company common shares determined by multiplying the applicable percentage for the level of performance certified by the Compensation Committee times the Participant’s total number of ROE Award Shares. Any ROE Award Shares that do not vest as of the Normal Vesting Date will be forfeited.

6. Limitations on Payment of Award:  The Committee may, in its sole discretion, reduce the amount payable with respect to the Award.

7. Forfeiture of Awards:  If the Company is required to prepare an accounting restatement due to material non-compliance of the Company, as a result of misconduct by a Participant, with any financial reporting requirement under any applicable laws, the Participant shall reimburse the Company for all amounts received under the Equity LTI Plan within 30 days after receipt of notice of the same from the Company.

8. Effect of Termination:  Participant may forfeit this Award if employment terminates prior to the Normal Vesting Date, although it will depend on the reason for termination as provided below:

(a) Death, Disability or Retirement. If you terminate due to death, Disability, or Retirement, you will vest in a prorated portion of your ROE Award Shares determined by multiplying the number of your ROE Award Shares by a fraction, the numerator of which is the number of whole months you were employed from the Grant Date to the date of death, Disability or Retirement, and the denominator of which is 36.  Payment of the Award shall be made to the Participant in the form of a number of Company common shares determined by multiplying such pro rata portion of your ROE Award Shares by the applicable percentage for the level of performance certified by the Compensation Committee, with performance based on the Company’s relative Average ROE for the portion of the Performance Period that ended on the last day of the calendar quarter immediately preceding the date of termination. Such settlement of the Award will occur within ninety (90) days of the date of termination. Any ROE Award Shares that do not vest or are not so settled will be forfeited. For purposes of hereof, “Retirement” means termination after attaining either age 55 with at least 10 years of service with the Company or age 62 with at least 5 years of service with the Company.

(b) Termination by the Company without Cause or by Participant for Good Reason. If the Company terminates your employment without “Cause,” or you terminate your employment with the Company for “Good Reason,” each as defined in Exhibit A attached hereto and incorporated herein, you will vest in and receive a prorated portion of your ROE Award Shares determined in the same manner as described in Section 8(a) hereinabove based on your termination date.

(c) Termination for any Other Reason. If your employment with the Company terminates under any other circumstance (including if such termination is by the Company for Cause regardless of whether such termination could also constitute a Retirement), your ROE Award Shares will be forfeited on your termination date.

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9. Effect of Change in Control:Notwithstanding the foregoing, if a Change in Control occurs after the Grant Date, your ROE Award Shares will be subject to the following additional terms and conditions:

(a) If such a Change in Control occurs prior to the Normal Vesting Date and in connection therewith or within two years thereafter your employment is terminated either by the Company or a successor in interest for any reason other than for “Cause” or by you for “Good Reason,” you shall be entitled to receive a number of Company common shares determined as though the Performance Objective had been satisfied at the “target” level of achievement for the Performance Period. Therefore, 50% of your unvested ROE Award Shares which remain unvested as of the termination date will fully vest.

10. Restrictive Covenants.

(a) Non-Solicitation.  The Participant acknowledges and agrees that as a condition to and in consideration of this Award Agreement, during the term of the Participant’s employment and for a period of twenty-four (24) months thereafter (the “Non-Solicitation Restrictive Period”), the Participant will not, directly or indirectly:

(i) Solicit, engage or otherwise interfere with any customer or client who is at the time of termination or was within the preceding six (6) months of termination a customer or client of Company, its subsidiaries or any other related entity for the purposes of directly or indirectly furnishing any financial or banking services that a national banking association, bank holding company, state bank, savings and loan association or other regulated financial institution is permitted by law to conduct or furnish on the date the Participant’s employment is terminated.  

(ii) Employ, solicit for employment, engage or otherwise interfere with any person who is at the time of termination or was within the preceding six (6) months of termination employed by the Company, its subsidiaries or any related entity, or otherwise directly or indirectly induce or take any action which would encourage or influence any such person to leave that person’s employment or terminate, reduce or modify their business or relationship with the Company, or any of its subsidiaries or related entities.

The restrictive covenants and Restrictive Periods provided for herein will not be construed to limit the application of any other restrictive covenant or restriction period set forth in any other agreement entered into between the Participant and the Company.

(b) Nondisclosure and Non-appropriation of Information.  The Participant recognizes and acknowledges that while employed by the Company, the Participant will have access to, learn, be provided with and, in some cases, prepare and create, certain Confidential Information (as defined in section (c) below), proprietary information or Trade Secrets (as defined below) of the Company, including, but not limited to, processes, financial information, pricing information, operating techniques, marketing processes, training techniques, customer, vendor, and referral source lists, price and cost information, files and forms, (collectively, the “Trade Secrets”), all of which are of substantial value to the Company and the businesses conducted by it.  The Participant expressly covenants and agrees that the Participant will:

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(i) Hold in a fiduciary capacity and not reveal, communicate, use or cause to be used for the Participant’s own benefit or divulge during the period of employment by the Company and for an indefinite period thereafter, any Confidential Information, proprietary information or Trade Secrets now or hereafter owned by the Company;

(ii) Not sell, exchange, give away, or otherwise dispose of Confidential Information, proprietary information or Trade Secrets now or hereafter owned by the Company, whether the same will or may have been originated or discovered by the Company, the Participant or otherwise;

(iii) Not reveal, divulge or make known to any person, firm, company or corporation any Confidential Information, proprietary information or Trade Secrets of the Company, unless such communication is required pursuant to a compulsory proceeding in which the Participant’s failure to provide such Confidential Information, proprietary information or Trade Secrets would subject the Participant to criminal or civil sanctions and then only to the extent that Executive provides prior notice to Company prior to disclosure.

(iv) Return to the Company before termination of employment with the Company, any and all written information, material or equipment that constitutes, contains or relates in any way to Confidential Information, proprietary information, Trade Secrets and any other documents, equipment, and material of any kind relating in any way to the business of the Company, which are in the Participant’s possession, custody and control and which are or may be property of the Company, whether confidential or not, including any and all copies thereof which may have been made by or for the Participant and that the Participant will maintain no copies thereof after termination of the Participant’s employment.

(c) Definitions.

(i) “Confidential Information” means all information disclosed to or known by the Participant as a consequence of or through is employment with the Company which either has not been made generally available to the public and is useful or of value to the current or anticipated business of the Company; or has been identified to the Participant as confidential, either orally or in writing.  Confidential Information includes without limitation computer software and programs; marketing, manufacturing, organizational research and development; business plans; sales forecasts; identities, competence, abilities and compensation of other employees of the Company; pricing cost and other financial information; current and prospective customer and supplier lists and information about customers, suppliers or their employees; information concerning planned or pending acquisitions or divestitures; and information concerning purchases of equipment or property.  Confidential Information does not include information which is in or hereafter enters the public domain through no fault of the Participant, or is disclosed by a third party having the legal right to use and disclose the information.

(d) Other Terms and Conditions.

(i) The Participant acknowledges that the Participant is entering into this Award Agreement voluntarily and has given careful consideration to the restraints imposed by this Award Agreement.  Irrespective of the manner of any employment

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termination, the restraints imposed by this Award Agreement will be operative during their full time periods and throughout the restrictive areas set forth in this Award Agreement.  The Participant further acknowledges that if the Participant’s employment with the Company terminates for any reason the Participant can earn a livelihood without violating the foregoing restrictions and that the Participant’s ability to earn a livelihood without violating these restrictions is a material employment condition.  The Participant acknowledges and recognizes that if the Participant’s employment terminates for any reason, this Section 10 of thisAward Agreement will survive any such termination and any expiration of this Award Agreement.  Further, the Participant agrees and consents that this Award Agreement is assignable by the Company.

(ii) The Participant agrees that if a court of law finds that the provisions of this Award Agreement are too harsh so that they are unenforceable, then such court of law may enforce those restrictions and limitations which are acceptable and deemed enforceable by the court.

(iii) In the event the Participant breaches the terms of this Award Agreement, it is agreed that all time periods contained in this Award Agreement will be tolled until the Participant ceases to breach this Award Agreement.

(e) Injunction.  The parties acknowledge and agree, due to the subject matter of this Award Agreement, that money damages will be an inadequate remedy for a breach by Participant of any of the obligations hereunder.  Consequently, if the Participant breaches or threatens to breach any of the obligations under this Award Agreement, the Participant agrees that the Company shall have the right, in addition to any other rights or remedies available to it at law or in equity, to obtain equitable relief, including, without limitation, injunctive relief and specific performance, in the event of any breach or threatened breach. Further, the parties hereto agree and declare that it may be impossible to measure in monetary terms the damages that may accrue to the Company by reason of Participant’s violation of this Award Agreement.  Therefore, in the event that the Company, or any successor in interest thereto, shall institute an action or proceeding to enforce the provisions of this Award Agreement, each party or other person against whom such action or proceeding is brought shall and hereby does, in advance, waive the claim or defense that there is adequate remedy at law. In the event such injunctive relief is warranted and obtained by the Company, Participant agrees to pay all costs of said action, including reasonable attorney fees.

11. Miscellaneous:

(a) Non-Transferability.An Award may not be sold, transferred, pledged, assigned or otherwise alienated or hypothecated, except by will or the laws of descent and distribution.  

(b) Beneficiary.Unless otherwise specifically designated by the Participant in writing, a Participant’s beneficiary under the Equity LTI Plan shall be the Participant’s spouse or, if no spouse survives the Participant, the Participant’s estate.

(c) No Right to Continued Service or to Awards.  The granting of an Award shall impose no obligation on the Company or any Affiliate to continue the employment of a Participant or interfere with or limit the right of the Company or any Affiliate to Terminate the employment of the Participant at any time, with or without Cause, which right is expressly reserved.  

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(d) Tax Withholding.  The Company or an Affiliate, as applicable, shall have the power and the right to deduct, withhold or collect any amount required by law or regulation to be withheld with respect to any taxable event arising with respect to an Award granted under the Equity LTI Plan.

(e) Requirements of Law.  The grant of Awards shall be subject to all applicable laws, rules and regulations (including applicable federal and state securities laws) and to all required approvals of any governmental agencies or national securities exchange, market or other quotation system.  

(f) Governing Law.  The Equity LTI Plan and all Award Agreements shall be governed by and construed in accordance with the laws of (other than laws governing conflicts of laws) the State of Ohio.

(g) Award Subject to Equity LTI Plan. The Award is subject to the terms and conditions described in this Award Agreement and the Equity LTI Plan, which is incorporated by reference into and made a part of this Award Agreement.  In the event of a conflict between the terms of the Equity LTI Plan and the terms of this Award Agreement, the terms of the Equity LTI Plan will govern.  The Committee has the sole responsibility of interpreting the Equity LTI Plan and this Award Agreement, and its determination of the meaning of any provision in the Equity LTI Plan or this Award Agreement will be binding on the Participant. Capitalized terms that are not defined in this Award Agreement have the same meanings as in the Equity LTI Plan.

(h) Section 409A Payment Delay.If a Participant is determined to be a “specified employee” (within the meaning of Section 409A of the Code and as determined under the Company’s policy for determining specified employees), the Participant shall not be entitled to payment or to distribution of any portion of an Award that is subject to Section 409A of the Code (and for which no exception applies) and is payable or distributable on account of the Participant’s “separation from service” (within the meaning of Section 409A of the Code) until the expiration of six months from the date of such separation from service (or, if earlier, the Participant’s death).  Such Award, or portion thereof, shall be paid or distributed on the first business day of the seventh month following such separation from service.

(i) Signature in Counterparts.  This Award Agreement may be signed in counterparts, each of which will be deemed an original, but all of which will constitute one and the same instrument.

[signature page attached]

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PARTICIPANT
	Date:
Print Name:
FARMERS NATIONAL BANC CORP.
By:	Date:
Its:

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EXHIBIT A

DEFINITIONS OF “CAUSE” AND “GOOD REASON”

“Cause” means that, in the reasonable judgment of the Compensation Committee, any of the following events have occurred: (1) the willful or negligent failure by the Participant to substantially perform his or her duties with the Company and, after written notification by the Company to the Participant, the continued failure of the Participant to substantially perform such duties; (2) the willful or negligent engagement by the Participant in conduct which is demonstrably and materially injurious to the Company, financially or otherwise; (3) action or inaction by the Participant that constitutes a breach of fiduciary duty with respect to the Company or any of its subsidiaries; (4) the violation of any material written policy, rule or regulation of the Company; or (5) the Participant’s material breach of any agreement in respect of confidentiality with the Company, whether or not entered into after the Grant Date.

“Good Reason” means the occurrence of any of the following: (1) a reduction in Participant’s annual base salary rate, unless such reduction generally applies to other Participants regardless of the reason(s) therefor; (2) a substantial diminution in Participant’s duties, authorities or responsibilities; or (3) the relocation of Participant’s principal place of employment with the Company such that (a) the distance from the former principal place of employment to the relocated principal place of employment is over 50 miles and (b) the distance from his or her primary residence to the relocated principal place of employment is over 50 miles; provided, however, that Good Reason shall exist only to the extent that Participant provides the Company with written notice of his or her intention to terminate employment with the Company for Good Reason that specifies the condition(s) constituting Good Reason and the Company fails to correct such condition(s) within ten (10) business days from receipt of such written notice. Notwithstanding the foregoing, Good Reason shall cease to exist for an event on the one hundred and twentieth (120^th) day following the later of its occurrence or Participant’s knowledge thereof, unless Participant has given the Company written notice of such condition and of Participant’s intent to terminate for Good Reason prior to such date. With respect to the Chief Executive Officer only, Good Reason shall also include a change in responsibilities such that the Chief Executive Officer reports to someone other than directly to the Company’s Board of Directors.

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EX-10.3

Exhibit 10.3

FARMERS NATIONAL BANC CORP.

RESTRICTED STOCK AWARD AGREEMENT

(2022)

Farmers National Banc Corp. (the “Company”) hereby grants the undersigned Participant an Award pursuant to the Farmers National Banc Corp. 2017 Equity Incentive Plan (the “Plan”) as evidenced by the Notice of Grant accompanying this Award Agreement (the “Grant Notice”), and as further described in this Award Agreement (this “Award Agreement”).

1. Nature of Award.  Effective as of the date specified in the Grant Notice (the “Grant Date”), the Company hereby grants to the individual identified in the Grant Notice (the “Participant”) the award as set forth in the Grant Notice (the “Award”).  The Award is subject to the terms and conditions described in the Plan, this Award Agreement and the Grant Notice.

2. Number of Shares.  The number of Shares of Restricted Stock in your Award is set forth in the Grant Notice.  For purposes of this Award Agreement, each whole Share awarded represents the right to receive one Share.

3. Vesting.  The Shares of Restricted Stock in your Award will be settled or will be forfeited depending on whether the terms and conditions described in the Grant Notice, this Award Agreement, and the Plan are satisfied. Accordingly, your Shares normally will vest on the “Normal Vesting Date” in accordance with the schedule identified in the Grant Notice. If the scheduled Normal Vesting Date is a non-business day, the next following business day will be considered the Normal Vesting Date.

4. Forfeiture of Awards:  If the Company is required to prepare an accounting restatement due to material non-compliance of the Company, as a result of misconduct by a Participant, with any financial reporting requirement under any applicable laws, the Participant shall reimburse the Company for all amounts received under the Plan within 30 days after receipt of notice of the same from the Company.

5. Effect of Termination:  Participant may forfeit this Award if employment terminates prior to the Normal Vesting Date, although it will depend on the reason for termination as provided below:

a. Termination Due to Death or Disability.  If you terminate due to death or Disability, your Shares of Restricted Stock will vest fully on the date of your death or Disability.

b. Termination Due to Retirement.  If you terminate due to Retirement, you will vest in a prorated portion of your Shares of Restricted Stock determined by multiplying the number of your Award Shares by a fraction, the numerator of which is the number of whole months you were employed from the Grant Date to the date of Retirement, and the denominator of which is 36. For purposes of hereof, “Retirement” means termination after attaining either age 55 with at least 10 years of service with the Company or age 62 with at least 5 years of service with the Company.

c. Termination by the Company without Cause or by Participant for Good Reason. If the Company terminates your employment without “Cause,” or you terminate your employment with the Company for “Good Reason,” each as defined in Exhibit A attached hereto and incorporated herein, you will vest in and receive a prorated portion of your Award Shares determined in the same manner as described in Section 5(b) hereinabove based on your termination date.

d. Termination for any Other Reason.  If your employmentwith the Company terminates under any other circumstance (including if such termination is by the Company for Cause regardless of whether such termination could also constitute a Retirement), your Shares of Restricted Stock will be forfeited on your termination date.

6. Effect of Change in Control: Notwithstanding the foregoing, if a Change in Control occurs after the Grant Date, your Shares of Restricted Stock will be subject to the following additional terms and conditions:

a. If such a Change in Control occurs prior to the Normal Vesting Date and in connection therewith or within two years thereafter your employment is terminated either by the Company or a successor in interest for any reason other than for “Cause” or by you for “Good Reason,” your Shares of Restricted Stock which remain unvested as of the termination date will fully vest.

7. Restrictive Covenants.

a. Non-Solicitation.  The Participant acknowledges and agrees that as a condition to and in consideration of this Award Agreement, during the term of the Participant’s employment and for a period of twenty-four (24) months thereafter (the “Non-Solicitation Restrictive Period”), the Participant will not, directly or indirectly:

(i) Solicit, engage or otherwise interfere with any customer or client who is at the time of termination or was within the preceding six (6) months of termination a customer or client of Company, its subsidiaries or any other related entity for the purposes of directly or indirectly furnishing any financial or banking services that a national banking association, bank holding company, state bank, savings and loan association or other regulated financial institution is permitted by law to conduct or furnish on the date the Participant’s employment is terminated.  

(ii) Employ, solicit for employment, engage or otherwise interfere with any person who is at the time of termination or was within the preceding six (6) months of termination employed by the Company, its subsidiaries or any related entity, or otherwise directly or indirectly induce or take any action which would encourage or influence any such person to leave that person’s employment or terminate, reduce or modify their business or relationship with the Company, or any of its subsidiaries or related entities.

The restrictive covenants and Restrictive Periods provided for herein will not be construed to limit the application of any other restrictive covenant or restriction period set forth in any other agreement entered into between the Participant and the Company.

b. Nondisclosure and Non-appropriation of Information.  The Participant recognizes and acknowledges that while employed by the Company, the Participant will have access to, learn, be provided with and, in some cases, prepare and create, certain Confidential Information (as defined in section (c) below), proprietary information or Trade Secrets (as defined below) of the Company, including, but not limited to, processes, financial information, pricing information, operating techniques, marketing processes, training techniques, customer, vendor, and referral source lists, price and cost information, files and forms, (collectively, the “Trade Secrets”), all of which are of substantial value to the Company and the businesses conducted by it.  The Participant expressly covenants and agrees that the Participant will:

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(i) Hold in a fiduciary capacity and not reveal, communicate, use or cause to be used for the Participant’s own benefit or divulge during the period of employment by the Company and for an indefinite period thereafter, any Confidential Information, proprietary information or Trade Secrets now or hereafter owned by the Company;

(ii) Not sell, exchange, give away, or otherwise dispose of Confidential Information, proprietary information or Trade Secrets now or hereafter owned by the Company, whether the same will or may have been originated or discovered by the Company, the Participant or otherwise;

(iii) Not reveal, divulge or make known to any person, firm, company or corporation any Confidential Information, proprietary information or Trade Secrets of the Company, unless such communication is required pursuant to a compulsory proceeding in which the Participant’s failure to provide such Confidential Information, proprietary information or Trade Secrets would subject the Participant to criminal or civil sanctions and then only to the extent that Executive provides prior notice to Company prior to disclosure.

(iv) Return to the Company before termination of employment with the Company, any and all written information, material or equipment that constitutes, contains or relates in any way to Confidential Information, proprietary information, Trade Secrets and any other documents, equipment, and material of any kind relating in any way to the business of the Company, which are in the Participant’s possession, custody and control and which are or may be property of the Company, whether confidential or not, including any and all copies thereof which may have been made by or for the Participant and that the Participant will maintain no copies thereof after termination of the Participant’s employment.

c. Definitions.

(i) “Confidential Information” means all information disclosed to or known by the Participant as a consequence of or through is employment with the Company which either has not been made generally available to the public and is useful or of value to the current or anticipated business of the Company; or has been identified to the Participant as confidential, either orally or in writing.  Confidential Information includes without limitation computer software and programs; marketing, manufacturing, organizational research and development; business plans; sales forecasts; identities, competence, abilities and compensation of other employees of the Company; pricing cost and other financial information; current and prospective customer and supplier lists and information about customers, suppliers or their employees; information concerning planned or pending acquisitions or divestitures; and information concerning purchases of equipment or property.  Confidential Information does not include information which is in or hereafter enters the public domain through no fault of the Participant, or is disclosed by a third party having the legal right to use and disclose the information.

d. Other Terms and Conditions.

(i) The Participant acknowledges that the Participant is entering into this Award Agreement voluntarily and has given careful consideration to the restraints imposed by this Award Agreement.  Irrespective of the manner of any employment termination, the restraints imposed by this Award Agreement will be operative

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during their full time periods and throughout the restrictive areas set forth in this Award Agreement.  The Participant further acknowledges that if the Participant’s employment with the Company terminates for any reason the Participant can earn a livelihood without violating the foregoing restrictions and that the Participant’s ability to earn a livelihood without violating these restrictions is a material employment condition.  The Participant acknowledges and recognizes that if the Participant’s employment terminates for any reason, this Section 7 of thisAward Agreement will survive any such termination and any expiration of this Award Agreement.  Further, the Participant agrees and consents that this Award Agreement is assignable by the Company.

(ii) The Participant agrees that if a court of law finds that the provisions of this Award Agreement are too harsh so that they are unenforceable, then such court of law may enforce those restrictions and limitations which are acceptable and deemed enforceable by the court.

(iii) In the event the Participant breaches the terms of this Award Agreement, it is agreed that all time periods contained in this Award Agreement will be tolled until the Participant ceases to breach this Award Agreement.

e. Injunction.  The parties acknowledge and agree, due to the subject matter of this Award Agreement, that money damages will be an inadequate remedy for a breach by Participant of any of the obligations hereunder.  Consequently, if the Participant breaches or threatens to breach any of the obligations under this Award Agreement, the Participant agrees that the Company shall have the right, in addition to any other rights or remedies available to it at law or in equity, to obtain equitable relief, including, without limitation, injunctive relief and specific performance, in the event of any breach or threatened breach. Further, the parties hereto agree and declare that it may be impossible to measure in monetary terms the damages that may accrue to the Company by reason of Participant’s violation of this Award Agreement.  Therefore, in the event that the Company, or any successor in interest thereto, shall institute an action or proceeding to enforce the provisions of this Award Agreement, each party or other person against whom such action or proceeding is brought shall and hereby does, in advance, waive the claim or defense that there is adequate remedy at law. In the event such injunctive relief is warranted and obtained by the Company, Participant agrees to pay all costs of said action, including reasonable attorney fees.

8. Miscellaneous:  

a. Non-Transferability.An Award may not be sold, transferred, pledged, assigned or otherwise alienated or hypothecated, except by will or the laws of descent and distribution.  

b. Beneficiary.Unless otherwise specifically designated by the Participant in writing, a Participant’s beneficiary under the Plan shall be the Participant’s spouse or, if no spouse survives the Participant, the Participant’s estate.

c. No Right to Continued Service or to Awards.  The granting of an Award shall impose no obligation on the Company or any Affiliate to continue the employment of a Participant or interfere with or limit the right of the Company or any Affiliate to Terminate the employment of the Participant at any time, with or without Cause, which right is expressly reserved.  

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d. Tax Withholding.  The Company or an Affiliate, as applicable, shall have the power and the right to deduct, withhold or collect any amount required by law or regulation to be withheld with respect to any taxable event arising with respect to an Award granted under the Plan.

e. Requirements of Law.  The grant of Awards shall be subject to all applicable laws, rules and regulations (including applicable federal and state securities laws) and to all required approvals of any governmental agencies or national securities exchange, market or other quotation system.  

f. Governing Law.  The Plan and all Award Agreements shall be governed by and construed in accordance with the laws of (other than laws governing conflicts of laws) the State of Ohio.

g. Award Subject to Plan. The Award is subject to the terms and conditions described in this Award Agreement and the Plan, which is incorporated by reference into and made a part of this Award Agreement.  In the event of a conflict between the terms of the Plan and the terms of this Award Agreement, the terms of the Plan will govern.  The Committee has the sole responsibility of interpreting the Plan and this Award Agreement, and its determination of the meaning of any provision in the Plan or this Award Agreement will be binding on the Participant. Capitalized terms that are not defined in this Award Agreement have the same meanings as in the Plan.

h. Section 409A Payment Delay.If a Participant is determined to be a “specified employee” (within the meaning of Section 409A of the Code and as determined under the Company’s policy for determining specified employees), the Participant shall not be entitled to payment or to distribution of any portion of an Award that is subject to Section 409A of the Code (and for which no exception applies) and is payable or distributable on account of the Participant’s “separation from service” (within the meaning of Section 409A of the Code) until the expiration of six months from the date of such separation from service (or, if earlier, the Participant’s death).  Such Award, or portion thereof, shall be paid or distributed on the first business day of the seventh month following such separation from service.

i. Signature in Counterparts.  This Award Agreement may be signed in counterparts, each of which will be deemed an original, but all of which will constitute one and the same instrument.

[signature page attached]

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PARTICIPANT	FARMERS NATIONAL BANC CORP.
	By:
Signature
	Its:
Print
Date:	Date:

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EXHIBIT A

DEFINITIONS OF “CAUSE” AND “GOOD REASON”

“Cause” means that, in the reasonable judgment of the Compensation Committee, any of the following events have occurred: (1) the willful or negligent failure by the Participant to substantially perform his or her duties with the Company and, after written notification by the Company to the Participant, the continued failure of the Participant to substantially perform such duties; (2) the willful or negligent engagement by the Participant in conduct which is demonstrably and materially injurious to the Company, financially or otherwise; (3) action or inaction by the Participant that constitutes a breach of fiduciary duty with respect to the Company or any of its subsidiaries; (4) the violation of any material written policy, rule or regulation of the Company; or (5) the Participant’s material breach of any agreement in respect of confidentiality with the Company, whether or not entered into after the Grant Date.

“Good Reason” means the occurrence of any of the following: (1) a reduction in Participant’s annual base salary rate, unless such reduction generally applies to other Participants regardless of the reason(s) therefor; (2) a substantial diminution in Participant’s duties, authorities or responsibilities; or (3) the relocation of Participant’s principal place of employment with the Company such that (a) the distance from the former principal place of employment to the relocated principal place of employment is over 50 miles and (b) the distance from his or her primary residence to the relocated principal place of employment is over 50 miles; provided, however, that Good Reason shall exist only to the extent that Participant provides the Company with written notice of his or her intention to terminate employment with the Company for Good Reason that specifies the condition(s) constituting Good Reason and the Company fails to correct such condition(s) within ten (10) business days from receipt of such written notice. Notwithstanding the foregoing, Good Reason shall cease to exist for an event on the one hundred and twentieth (120^th) day following the later of its occurrence or Participant’s knowledge thereof, unless Participant has given the Company written notice of such condition and of Participant’s intent to terminate for Good Reason prior to such date. With respect to the Chief Executive Officer only, Good Reason shall also include a change in responsibilities such that the Chief Executive Officer reports to someone other than directly to the Company’s Board of Directors.

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EX-10.4

Exhibit 10.4

FARMERS NATIONAL BANC CORP.

PERFORMANCE-BASED CASH AWARD AGREEMENT

(2022)

Farmers National Banc Corp. (the “Company”) hereby grants the undersigned Participant an Award pursuant to the Farmers National Banc Corp. Long-Term Incentive Plan (the “Cash LTI Plan”), as evidenced by the Notice of Grant accompanying this Award Agreement (the “Grant Notice”), and as further described in this Award Agreement (this “Award Agreement”).

1. Nature of Award.  Effective as of the date specified in the Grant Notice (the “Grant Date”), the Company hereby grants to the individual identified in the Grant Notice (the “Participant”) the award as set forth in the Grant Notice (the “Award”).  The Award is subject to the terms and conditions described in the Cash LTI Plan, this Award Agreement and the Grant Notice.

2. Performance Period:  The three-year period beginning on the January 1, 2022 and ending on December 31, 2024 (the “Performance Period”).

3. Target Cash Award as Percentage of Base Compensation: ____% x .25 (the “Target Performance-Based Cash Award”).

4. Earning an Award:  The Participant shall be eligible to receive a payment equal to between 0% and 200% of the Target Performance-Based Cash Award, based on achievement during the Performance Period of the Performance Objective set forth below. Performance between two stated levels will be interpolated when determining the percentage of the Target Performance-Based Cash Award earned.

The percentage of the Target Performance-Based Cash Award that is earned will be based on the Company’s Total Shareholder Return (“TSR”) during the Performance Period compared to the Total Shareholder Return of the Company’s Peer Group during the Performance Period (“Relative TSR”), expressed as a percentile. Between 0% and 200% of the Target Performance-Based Cash Award is subject to vesting on the “Normal Vesting Date” stated in the Grant Notice, in accordance with the following schedule and percentages:

Performance Objective: Relative TSR during Performance Period	Percentage of Target Cash Award Earned
Less than Peer Group 25th percentile	0%
Equal to Peer Group 25th percentile (threshold)	20%
Equal to Peer Group 50th percentile (target)	100%
Equal to or higher than Peer Group 75th percentile (max)	200%

For these purposes: (i) Relative TSR shall be determined by the Committee in its sole discretion; and (ii) the Committee shall select the institutions constituting, and make such periodic adjustments as it determines appropriate to, the “Peer Group” in its sole discretion.

5. Payment of Award:  With respect to the Performance Period, the Committee shall certify the level of achievement of the Performance Objective set forth in Section 4 and determine the amount payable with respect to your Award based on such level of achievement. Payment of the Award shall be made to the Participant in cash in a single lump sum on the Normal Vesting Date determined by multiplying the applicable percentage for the level of performance certified by the Compensation Committee times the Participant’s Target Performance-Based Cash Award.

6. Limitations on Payment of Award:  The Committee may, in its sole discretion, reduce the amount payable with respect to the Award.

7. Forfeiture of Awards:  If the Company is required to prepare an accounting restatement due to material non-compliance of the Company, as a result of misconduct by a Participant, with any financial reporting requirement under any applicable laws, the Participant shall reimburse the Company for all amounts received under the Cash LTI Plan within 30 days after receipt of notice of the same from the Company.

8. Effect of Termination:  Participant may forfeit this Award if employment terminates prior to the Normal Vesting Date, although it will depend on the reason for termination as provided below:

(a) Death, Disability or Retirement. If you terminate due to death, Disability, or Retirement, the amount of your Award (if any) shall be multiplied by a fraction, the numerator of which is the number of whole months you were employed from the Grant Date to the date of death, Disability or Retirement, and the denominator of which is 36.  Payment of the Award shall be made to the Participant in cash in a single lump sum determined by multiplying such pro rata portion of your Target Performance-Based Cash Award by the applicable percentage for the level of performance certified by the Compensation Committee, with performance based on the Company’s relative TSR for the portion of the Performance Period that ended on the last day of the calendar quarter immediately preceding the date of termination. Such payment of the Award will occur within ninety (90) days of the date of termination. For purposes of hereof, “Retirement” means termination after attaining either age 55 with at least 10 years of service with the Company or age 62 with at least 5 years of service with the Company.

(b) Termination by the Company without Cause or by Participant for Good Reason. If the Company terminates your employment without “Cause,” or you terminate your employment with the Company for “Good Reason,” each as defined in Exhibit A attached hereto and incorporated herein, you will be paid a prorated portion of your Target Performance-Based Cash Award determined in the same manner as described in Section 8(a) hereinabove based on your termination date.

(c) Termination for any Other Reason. If your employment with the Company terminates under any other circumstance (including if such termination is by the Company for Cause regardless of whether such termination could also constitute a Retirement), you shall forfeit any rights with respect to the Award on your termination date.

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9. Effect of Change in Control:Notwithstanding the foregoing, if a Change in Control occurs after the Grant Date, your Award will be subject to the following additional terms and conditions:

(a) If such a Change in Control occurs prior to the Normal Vesting Date and in connection therewith or within two years thereafter your employment is terminated either by the Company or a successor in interest for any reason other than for “Cause” or by you for “Good Reason,” you shall be entitled to receive a payment equal to the amount payable with respect to your Award as though the Performance Objective had been satisfied at the “target” level of achievement for the Performance Period.  Therefore, you shall be entitled to a payment in the amount of 100% of your Target Performance-Based Cash Award. Payment will be made in a single lump-sum cash payment within 60 days following the termination date.

10. Restrictive Covenants.

(a) Non-Solicitation.  The Participant acknowledges and agrees that as a condition to and in consideration of this Award Agreement, during the term of the Participant’s employment and for a period of twenty-four (24) months thereafter (the “Non-Solicitation Restrictive Period”), the Participant will not, directly or indirectly:

(i) Solicit, engage or otherwise interfere with any customer or client who is at the time of termination or was within the preceding six (6) months of termination a customer or client of Company, its subsidiaries or any other related entity for the purposes of directly or indirectly furnishing any financial or banking services that a national banking association, bank holding company, state bank, savings and loan association or other regulated financial institution is permitted by law to conduct or furnish on the date the Participant’s employment is terminated.  

(ii) Employ, solicit for employment, engage or otherwise interfere with any person who is at the time of termination or was within the preceding six (6) months of termination employed by the Company, its subsidiaries or any related entity, or otherwise directly or indirectly induce or take any action which would encourage or influence any such person to leave that person’s employment or terminate, reduce or modify their business or relationship with the Company, or any of its subsidiaries or related entities.

The restrictive covenants and Restrictive Periods provided for herein will not be construed to limit the application of any other restrictive covenant or restriction period set forth in any other agreement entered into between the Participant and the Company.

(b) Nondisclosure and Non-appropriation of Information.  The Participant recognizes and acknowledges that while employed by the Company, the Participant will have access to, learn, be provided with and, in some cases, prepare and create, certain Confidential Information (as defined in section (c) below), proprietary information or Trade Secrets (as defined below) of the Company, including, but not limited to, processes, financial information, pricing information, operating techniques, marketing processes, training techniques, customer, vendor, and referral source lists, price and cost information, files and forms, (collectively, the “Trade Secrets”), all of which are of substantial value to the Company and the businesses conducted by it.  The Participant expressly covenants and agrees that the Participant will:

-3-

(i) Hold in a fiduciary capacity and not reveal, communicate, use or cause to be used for the Participant’s own benefit or divulge during the period of employment by the Company and for an indefinite period thereafter, any Confidential Information, proprietary information or Trade Secrets now or hereafter owned by the Company;

(ii) Not sell, exchange, give away, or otherwise dispose of Confidential Information, proprietary information or Trade Secrets now or hereafter owned by the Company, whether the same will or may have been originated or discovered by the Company, the Participant or otherwise;

(iii) Not reveal, divulge or make known to any person, firm, company or corporation any Confidential Information, proprietary information or Trade Secrets of the Company, unless such communication is required pursuant to a compulsory proceeding in which the Participant’s failure to provide such Confidential Information, proprietary information or Trade Secrets would subject the Participant to criminal or civil sanctions and then only to the extent that Executive provides prior notice to Company prior to disclosure.

(iv) Return to the Company before termination of employment with the Company, any and all written information, material or equipment that constitutes, contains or relates in any way to Confidential Information, proprietary information, Trade Secrets and any other documents, equipment, and material of any kind relating in any way to the business of the Company, which are in the Participant’s possession, custody and control and which are or may be property of the Company, whether confidential or not, including any and all copies thereof which may have been made by or for the Participant and that the Participant will maintain no copies thereof after termination of the Participant’s employment.

(c) Definitions.

(i) “Confidential Information” means all information disclosed to or known by the Participant as a consequence of or through is employment with the Company which either has not been made generally available to the public and is useful or of value to the current or anticipated business of the Company; or has been identified to the Participant as confidential, either orally or in writing.  Confidential Information includes without limitation computer software and programs; marketing, manufacturing, organizational research and development; business plans; sales forecasts; identities, competence, abilities and compensation of other employees of the Company; pricing cost and other financial information; current and prospective customer and supplier lists and information about customers, suppliers or their employees; information concerning planned or pending acquisitions or divestitures; and information concerning purchases of equipment or property.  Confidential Information does not include information which is in or hereafter enters the public domain through no fault of the Participant, or is disclosed by a third party having the legal right to use and disclose the information.

(d) Other Terms and Conditions.

(i) The Participant acknowledges that the Participant is entering into this Award Agreement voluntarily and has given careful consideration to the restraints imposed by this Award Agreement.  Irrespective of the manner of any employment

-4-

termination, the restraints imposed by this Award Agreement will be operative during their full time periods and throughout the restrictive areas set forth in this Award Agreement.  The Participant further acknowledges that if the Participant’s employment with the Company terminates for any reason the Participant can earn a livelihood without violating the foregoing restrictions and that the Participant’s ability to earn a livelihood without violating these restrictions is a material employment condition.  The Participant acknowledges and recognizes that if the Participant’s employment terminates for any reason, this Section 10 of the Award Agreement will survive any such termination and any expiration of this Award Agreement.  Further, the Participant agrees and consents that this Award Agreement is assignable by the Company.

(ii) The Participant agrees that if a court of law finds that the provisions of this Award Agreement are too harsh so that they are unenforceable, then such court of law may enforce those restrictions and limitations which are acceptable and deemed enforceable by the court.

(iii) In the event the Participant breaches the terms of this Award Agreement, it is agreed that all time periods contained in this Award Agreement will be tolled until the Participant ceases to breach this Award Agreement.

(e) Injunction.  The parties acknowledge and agree, due to the subject matter of this Award Agreement, that money damages will be an inadequate remedy for a breach by Participant of any of the obligations hereunder.  Consequently, if the Participant breaches or threatens to breach any of the obligations under this Award Agreement, the Participant agrees that the Company shall have the right, in addition to any other rights or remedies available to it at law or in equity, to obtain equitable relief, including, without limitation, injunctive relief and specific performance, in the event of any breach or threatened breach. Further, the parties hereto agree and declare that it may be impossible to measure in monetary terms the damages that may accrue to the Company by reason of Participant’s violation of this Award Agreement.  Therefore, in the event that the Company, or any successor in interest thereto, shall institute an action or proceeding to enforce the provisions of this Award Agreement, each party or other person against whom such action or proceeding is brought shall and hereby does, in advance, waive the claim or defense that there is adequate remedy at law. In the event such injunctive relief is warranted and obtained by the Company, Participant agrees to pay all costs of said action, including reasonable attorney fees.

11. Miscellaneous:  

(a) Non-Transferability.An Award may not be sold, transferred, pledged, assigned or otherwise alienated or hypothecated, except by will or the laws of descent and distribution.  

(b) Beneficiary.Unless otherwise specifically designated by the Participant in writing, a Participant’s beneficiary under the Cash LTI Plan shall be the Participant’s spouse or, if no spouse survives the Participant, the Participant’s estate.

(c) No Right to Continued Service or to Awards.  The granting of an Award shall impose no obligation on the Company or any Affiliate to continue the employment of a Participant or interfere with or limit the right of the Company or any Affiliate to Terminate the employment of the Participant at any time, with or without Cause, which right is expressly reserved.  

-5-

(d) Tax Withholding.  The Company or an Affiliate, as applicable, shall have the power and the right to deduct, withhold or collect any amount required by law or regulation to be withheld with respect to any taxable event arising with respect to an Award granted under the Cash LTI Plan.

(e) Requirements of Law.  The grant of Awards shall be subject to all applicable laws, rules and regulations (including applicable federal and state securities laws) and to all required approvals of any governmental agencies or national securities exchange, market or other quotation system.  

(f) Governing Law.  The Cash LTI Plan and all Award Agreements shall be governed by and construed in accordance with the laws of (other than laws governing conflicts of laws) the State of Ohio.

(g) Award Subject to Cash LTI Plan. The Award is subject to the terms and conditions described in this Award Agreement and the Cash LTI Plan, which is incorporated by reference into and made a part of this Award Agreement.  In the event of a conflict between the terms of the Cash LTI Plan and the terms of this Award Agreement, the terms of the Cash LTI Plan will govern.  The Committee has the sole responsibility of interpreting the Cash LTI Plan and this Award Agreement, and its determination of the meaning of any provision in the Cash LTI Plan or this Award Agreement will be binding on the Participant. Capitalized terms that are not defined in this Award Agreement have the same meanings as in the Cash LTI Plan.

(h) Section 409A Payment Delay.If a Participant is determined to be a “specified employee” (within the meaning of Section 409A of the Code and as determined under the Company’s policy for determining specified employees), the Participant shall not be entitled to payment or to distribution of any portion of an Award that is subject to Section 409A of the Code (and for which no exception applies) and is payable or distributable on account of the Participant’s “separation from service” (within the meaning of Section 409A of the Code) until the expiration of six months from the date of such separation from service (or, if earlier, the Participant’s death).  Such Award, or portion thereof, shall be paid or distributed on the first business day of the seventh month following such separation from service.

(i) Signature in Counterparts.  This Award Agreement may be signed in counterparts, each of which will be deemed an original, but all of which will constitute one and the same instrument.

[signature page attached]

-6-

PARTICIPANT
	Date:
Print Name:
FARMERS NATIONAL BANC CORP.
By:	Date:
Its:

-7-

EXHIBIT A

DEFINITIONS OF “CAUSE” AND “GOOD REASON”

“Cause” means that, in the reasonable judgment of the Compensation Committee, any of the following events have occurred: (1) the willful or negligent failure by the Participant to substantially perform his or her duties with the Company and, after written notification by the Company to the Participant, the continued failure of the Participant to substantially perform such duties; (2) the willful or negligent engagement by the Participant in conduct which is demonstrably and materially injurious to the Company, financially or otherwise; (3) action or inaction by the Participant that constitutes a breach of fiduciary duty with respect to the Company or any of its subsidiaries; (4) the violation of any material written policy, rule or regulation of the Company; or (5) the Participant’s material breach of any agreement in respect of confidentiality with the Company, whether or not entered into after the Grant Date.

“Good Reason” means the occurrence of any of the following: (1) a reduction in Participant’s annual base salary rate, unless such reduction generally applies to other Participants regardless of the reason(s) therefor; (2) a substantial diminution in Participant’s duties, authorities or responsibilities; or (3) the relocation of Participant’s principal place of employment with the Company such that (a) the distance from the former principal place of employment to the relocated principal place of employment is over 50 miles and (b) the distance from his or her primary residence to the relocated principal place of employment is over 50 miles; provided, however, that Good Reason shall exist only to the extent that Participant provides the Company with written notice of his or her intention to terminate employment with the Company for Good Reason that specifies the condition(s) constituting Good Reason and the Company fails to correct such condition(s) within ten (10) business days from receipt of such written notice. Notwithstanding the foregoing, Good Reason shall cease to exist for an event on the one hundred and twentieth (120^th) day following the later of its occurrence or Participant’s knowledge thereof, unless Participant has given the Company written notice of such condition and of Participant’s intent to terminate for Good Reason prior to such date. With respect to the Chief Executive Officer only, Good Reason shall also include a change in responsibilities such that the Chief Executive Officer reports to someone other than directly to the Company’s Board of Directors.

-8-

EX-31.1

Exhibit 31.1

CERTIFICATIONS

Certification of Chief Executive Officer

CERTIFICATION FOR QUARTERLY REPORT ON FORM 10-Q

I, Kevin J. Helmick certify that:

1) I have reviewed this quarterly report on Form 10-Q of Farmers National Banc Corp.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

May 5, 2022

/s/	Kevin J. Helmick
Kevin J. Helmick
Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS

Certification of Chief Financial Officer

CERTIFICATION FOR QUARTERLY REPORT ON FORM 10-Q

I, A. Troy Adair certify that:

1) I have reviewed this quarterly report on Form 10-Q of Farmers National Banc Corp.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

May 5, 2022

/s/ A. Troy Adair

A. Troy Adair

Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Farmers National Banc Corp. (the “Corporation”) on Form 10-Q for the period ended March 31, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I Kevin J. Helmick, Chief Executive Officer of the Corporation, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

/s/ Kevin J. Helmick

Kevin J. Helmick

Chief Executive Officer

May 5, 2022

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Farmers National Banc Corp. (the “Corporation”) on Form 10-Q for the period ended March 31, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I A. Troy Adair, Chief Financial Officer of the Corporation, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

/s/ A. Troy Adair

A. Troy Adair

Chief Financial Officer

May 5, 2022

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2022	Apr. 30, 2022
Cover [Abstract]
Entity Registrant Name	FARMERS NATIONAL BANC CORP.
Entity Central Index Key	0000709337
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Document Type	10-Q
Document Period End Date	Mar. 31, 2022
Amendment Flag	false
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q1
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		34,007,677
Entity Shell Company	false
Title of 12(b) Security	Common Stock, No Par Value
Trading Symbol	FMNB
Security Exchange Name	NASDAQ
Entity File Number	001-35296
Entity Incorporation, State or Country Code	OH
Entity Tax Identification Number	34-1371693
Entity Address, Address Line One	20 South Broad Street
Entity Address, City or Town	Canfield
Entity Address, State or Province	OH
Entity Address, Postal Zip Code	44406
City Area Code	330
Local Phone Number	533-3341
Document Quarterly Report	true
Document Transition Report	false

XML

Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
ASSETS
Cash and due from banks	$ 29,224	$ 29,150
Federal funds sold and other	108,403	83,640
TOTAL CASH AND CASH EQUIVALENTS	137,627	112,790
Securities available for sale	1,463,626	1,427,677
Other investments	34,019	30,459
Loans held for sale	1,904	4,545
Loans	2,304,971	2,331,082
Less allowance for credit losses	27,015	29,386
NET LOANS	2,277,956	2,301,696
Premises and equipment, net	37,105	37,520
Goodwill	94,240	94,240
Other intangibles, net	7,947	8,366
Bank owned life insurance	74,264	73,855
Other assets	77,167	51,601
TOTAL ASSETS	4,205,855	4,142,749
Deposits:
Noninterest-bearing	963,143	916,237
Interest-bearing	2,690,668	2,630,998
Brokered time deposits	40,000	0
TOTAL DEPOSITS	3,693,811	3,547,235
Long-term borrowings	87,872	87,758
Other liabilities	30,286	35,324
TOTAL LIABILITIES	3,811,969	3,670,317
Commitments and contingent liabilities
Stockholders' Equity:
Common Stock - Authorized 50,000,000 shares in 2022 and 2021; 35,128,962 shares issued in 2022 and 2021 and 34,007,677 and 33,898,237 shares outstanding in 2022 and 2021, respectively	304,670	306,123
Retained earnings	184,302	173,896
Accumulated other comprehensive income	(79,500)	9,295
Treasury stock, at cost; 1,121,285 and 1,230,725 shares in 2022 and 2021, respectively	(15,586)	(16,882)
TOTAL STOCKHOLDERS' EQUITY	393,886	472,432
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 4,205,855	$ 4,142,749

XML

Consolidated Balance Sheets (Unaudited) (Parenthetical) - shares	Mar. 31, 2022	Dec. 31, 2021
Statement Of Financial Position [Abstract]
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	35,128,962	35,128,962
Common Stock, Shares, Outstanding	34,007,677	33,898,237
Treasury stock, shares	1,121,285	1,230,725

XML

Consolidated Statements of Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
INTEREST AND DIVIDEND INCOME
Loans, including fees	$ 25,562	$ 23,805
Taxable securities	4,587	1,719
Tax exempt securities	2,952	2,074
Dividends	130	121
Federal funds sold and other interest income	48	71
TOTAL INTEREST AND DIVIDEND INCOME	33,279	27,790
INTEREST EXPENSE
Deposits	1,244	2,226
Short-term borrowings	1	4
Long-term borrowings	792	293
TOTAL INTEREST EXPENSE	2,037	2,523
NET INTEREST INCOME	31,242	25,267
(Credit) provision for credit losses	(930)	425
Provision for unfunded loans	572	0
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES	31,600	24,842
NONINTEREST INCOME
Bank owned life insurance income, including death benefit	409	284
Security (losses) gains, including fair value changes for equity securities	(11)	488
Net gains on sale of loans	1,129	2,900
Other mortgage banking income (loss), net	60	(115)
Legal settlement	8,400	0
Other operating income	493	533
TOTAL NONINTEREST INCOME	17,698	10,132
NONINTEREST EXPENSES
Salaries and employee benefits	11,831	9,976
Occupancy and equipment	2,680	2,275
State and local taxes	678	554
Professional fees	3,135	1,056
Merger related costs	1,940	12
Advertising	392	260
FDIC insurance	267	170
Intangible amortization	420	316
Core processing charges	745	627
Charitable donation	6,000	0
Other operating expenses	2,368	2,071
TOTAL NONINTEREST EXPENSES	30,456	17,317
INCOME BEFORE INCOME TAXES	18,842	17,657
INCOME TAXES	2,998	3,101
NET INCOME	$ 15,844	$ 14,556
EARNINGS PER SHARE - basic	$ 0.47	$ 0.52
EARNINGS PER SHARE - fully diluted	$ 0.47	$ 0.51
Service Charges on Deposit Accounts
NONINTEREST INCOME
Noninterest income	$ 1,145	$ 808
Trust Fees
NONINTEREST INCOME
Noninterest income	2,519	2,236
Insurance Agency Commissions
NONINTEREST INCOME
Noninterest income	1,047	1,003
Retirement Plan Consulting Fees
NONINTEREST INCOME
Noninterest income	397	320
Investment Commissions
NONINTEREST INCOME
Noninterest income	694	504
Debit Card and EFT Fees
NONINTEREST INCOME
Noninterest income	$ 1,416	$ 1,171

XML

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2022	Mar. 31, 2021
Statement Of Income And Comprehensive Income [Abstract]
NET INCOME		$ 15,844	$ 14,556
Other comprehensive income:
Net unrealized holding losses on available for sale securities		(112,398)	(14,934)
Reclassification adjustment for (gains) realized in income	[1]	0	(383)
Net unrealized holding losses		(112,398)	(15,317)
Income tax effect		23,605	3,217
Unrealized holding losses, net of reclassification and tax		(88,793)	(12,100)
Change in funded status of post-retirement plan, net of tax		(2)	0
Other comprehensive loss, net of tax		(88,795)	(12,100)
TOTAL COMPREHENSIVE INCOME (LOSS)		$ (72,951)	$ 2,456

[1] Pre-tax reclassification adjustments relating to available-for-sale securities are reported in security gains and the tax impact is included in income tax expense on the consolidated statements of income.

XML

Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands	Total	Cumulative Impact of ASU 2016-13 Adoption (CECL)	Common Stock	Retained Earnings	Retained Earnings Cumulative Impact of ASU 2016-13 Adoption (CECL)	Accumulated Other Comprehensive Income (Loss)	Treasury Stock
Balance at Dec. 31, 2020	$ 350,097	$ (1,936)	$ 208,763	$ 138,073	$ (1,936)	$ 22,032	$ (18,771)
Net income	14,556			14,556
Other comprehensive loss	(12,100)					(12,100)
Stock based compensation expense	330		330
Vesting of Long Term Incentive Plan	0		(894)				894
Share forfeitures for taxes	(366)						(366)
Dividends paid	(3,110)			(3,110)
Treasury share purchases	(116)						(116)
Balance at Mar. 31, 2021	347,355		208,199	147,583		9,932	(18,359)
Balance at Dec. 31, 2021	472,432		306,123	173,896		9,295	(16,882)
Net income	15,844			15,844
Other comprehensive loss	(88,795)					(88,795)
Restricted share issuance	0		(1,030)				1,030
Stock based compensation expense	365		365
Vesting of Long Term Incentive Plan	(420)		(788)				368
Share forfeitures for taxes	(102)						(102)
Dividends paid	(5,438)			(5,438)
Balance at Mar. 31, 2022	$ 393,886		$ 304,670	$ 184,302		$ (79,500)	$ (15,586)

XML

Consolidated Statements of Stockholders' Equity (Parenthetical) Unaudited - $ / shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Retained Earnings
Cash dividend declared per share of common stock	$ 0.16	$ 0.11

XML

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$ 15,844	$ 14,556
Adjustments to reconcile net income to net cash from operating activities:
Provision for credit losses	(930)	425
Provision for unfunded loans	572	0
Depreciation and amortization	1,162	798
Net amortization of securities	1,378	618
Available for sale security gain	0	(383)
Realized (gains) losses on equity securities	11	(105)
Loss on premises and equipment sales and disposals, net	112	52
Stock compensation expense	365	330
Earnings on bank owned life insurance	(409)	(284)
Origination of loans held for sale	(41,419)	(51,990)
Proceeds from loans held for sale	45,369	55,948
Net gains on sale of loans	(1,129)	(2,900)
Net change in other assets and liabilities	(7,727)	(10,028)
NET CASH FROM OPERATING ACTIVITIES	13,199	7,037
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities and repayments of securities available for sale	22,712	17,155
Proceeds from sales of securities available for sale	0	26,186
Purchases of securities available for sale	(172,437)	(241,345)
Proceeds from sales of equity securities	18	20
Purchase of equity securities	(17)	(25)
Proceeds from maturities and repayments of SBIC funds	454	285
Purchases of SBIC funds	(454)	(196)
Proceeds from redemption of regulatory stock	0	253
Purchase of regulatory stock	(3,572)	(22)
Loan originations and payments, net	24,098	42,976
Proceeds from land and building sales	21	0
Additions to premises and equipment	(346)	(219)
NET CASH FROM INVESTING ACTIVITIES	(129,523)	(154,932)
CASH FLOWS FROM FINANCING ACTIVITIES
Net change in deposits	146,576	222,176
Net change in short-term borrowings	0	2,689
Repayment of long-term borrowings	0	(1,980)
Cash dividends paid	(5,415)	(3,110)
Repurchase of common shares	0	(116)
NET CASH FROM FINANCING ACTIVITIES	141,161	219,659
NET CHANGE IN CASH AND CASH EQUIVALENTS	24,837	71,764
Beginning cash and cash equivalents	112,790	254,621
Ending cash and cash equivalents	137,627	326,385
Supplemental cash flow information:
Interest paid	1,498	2,597
Supplemental noncash disclosures:
Transfer of loans to other real estate	0	30
Security purchases not settled	0	44,814
Issuance of stock awards	$ 1,398	$ 894

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Principles of Consolidation:

Farmers National Banc Corp. (“Company”) is a Financial Holding Company registered under the Bank Holding Company Act of 1956, as amended.  The Company provides full banking services through its nationally chartered subsidiary, The Farmers National Bank of Canfield (“Bank”).  The consolidated financial statements also include the accounts of the Bank’s subsidiaries; Farmers National Insurance, LLC (“Insurance”) and Farmers of Canfield Investment Co. (“Investments”).  The Company provides trust and retirement consulting services through its subsidiary, Farmers Trust Company (“Trust”), and insurance services through the Bank’s subsidiary, Insurance.  Farmers National Captive, Inc. (“Captive”) is a wholly-owned insurance subsidiary of the Company that provides property and casualty insurance coverage to the Company and its subsidiaries.  The Captive pools resources with eleven similar insurance company subsidiaries of financial institutions to spread a limited amount of risk among themselves and to provide insurance where not currently available or economically feasible in today’s insurance market place.  The consolidated financial statements include the accounts of the Company, the Bank and its subsidiaries, along with the Trust and Captive.  All significant intercompany balances and transactions have been eliminated in the consolidation.

Basis of Presentation:

The unaudited condensed consolidated financial statements have been prepared in conformity with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements.  The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2021 Annual Report to Shareholders included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 (“2021 Form 10-K”).  The interim consolidated financial statements include all adjustments (consisting of only normal recurring items) that, in the opinion of management, are necessary for a fair presentation of the financial position and results of operations for the periods presented.  The results of operations for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year.  Certain items included in the prior period financial statements were reclassified to conform to the current period presentation. There was no effect on net income or total stockholders’ equity.

Estimates:

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Segments:

The Company provides a broad range of financial services to individuals and companies in northeastern Ohio and western Pennsylvania.  Operations are managed and financial performance is primarily aggregated and reported in two lines of business, the Bank segment and the Trust segment.

Equity:

There are 50,000,000 shares authorized and available for issuance as of March 31, 2022.  Outstanding shares at March 31, 2022 were 34,007,677.

Comprehensive Income:

Comprehensive income consists of net income and other comprehensive income.  Other comprehensive income consists of unrealized gains and losses on securities available for sale and changes in the funded status of the post-retirement plan, which are recognized as components of stockholders’ equity, net of tax effect.

Updates to Significant Accounting Policies:

New Accounting Standard:

On March 31, 2022, FASB issued ASU 2022-2, which eliminates the troubled debt restructuring (“TDR”), accounting model for creditors that have adopted Topic 326, Financial Instruments – Credit Losses.”  Due to the removal of the TDR accounting model, all loan modifications now will be accounted for under the general loan modification guidance in Subtopic 310-20.  In addition, on a prospective basis, entities will be subject to new disclosure requirements covering modifications of receivables to borrowers experiencing financial difficulty.  Public business entities within the scope of the Topic 326 vintage disclosure requirements also will be required to prospectively disclose current-period gross write-off information by vintage, or year of origination.  For entities that have adopted Topic 326, ASU 2022-02 takes effect in reporting periods beginning after December 15, 2022.  Early adoption is permitted.  The Company has not elected to early adopt this ASU at this time.  The adoption of this standard is not expected to have a material effect on the Company’s operating results or financial condition.

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Business Combinations

3 Months Ended

Mar. 31, 2022

Business Combinations [Abstract]

Business Combinations

Business Combinations:

On March 23, 2022, Farmers entered into an agreement and plan of merger with Emclaire Financial (“Emclaire”), the parent company of The Farmers National Bank of Emlenton (“Emlenton”).  The transaction is subject to receipt of Emclaire shareholder approval and customary regulatory approvals and is expected to close in the second half of 2022.  The transaction will create a large expansion in Pennsylvania and into the Pittsburgh market.  Emclaire operates 19 branches in ten counties throughout western Pennsylvania.  As of March 31, 2022, Emclaire had total assets of $1.1 billion, gross loans of $794.9 million, deposits of $936.0 million and equity of $86.7 million.

On November 1, 2021, the Company completed the merger with Cortland Bancorp (“Cortland”), the parent company of The Cortland Savings and Banking Company (“Cortland Bank”), pursuant to the Agreement and Plan of Merger, dated as of June 22, 2021, as amended by that certain Amendment to Agreement and Plan of Merger, dated October 12, 2021 (collectively, the “Merger Agreement”), by and among the Company, Cortland, and FMNB Merger Subsidiary IV, LLC, a wholly-owned subsidiary of the Company (“Merger Sub”).  Pursuant to the terms of the Merger Agreement, on November 1, 2021, Cortland merged with and into Merger Sub (the “Merger”), with Merger Sub as the surviving entity in the Merger.  Promptly following the consummation of the Merger, Merger Sub was dissolved and liquidated and Cortland Bank merged with and into the Bank (the “Bank Merger”), with the Bank as the surviving bank in the Bank Merger.  The transaction received the approval of Cortland’s shareholders and all customary regulatory approvals.  Pursuant to the terms of the Merger Agreement, at the effective time of the Merger, each common share, without par value, of Cortland issued and outstanding immediately prior to the effective time (except for certain Cortland common shares held directly by Cortland or the Company) was converted into the right to receive, without interest, $28.00 per share in cash or 1.75 shares of the Company’s common stock, subject to an overall limitation of 75% of the Cortland shares being exchanged for the Company’s shares and the remaining 25% being exchanged for cash.  The Company issued 5.6 million shares of its common stock along with cash of $29.6 million, which represented a transaction value of approximately $128.5 million based on its closing stock price of $17.82 on October 31, 2021, the closing of the Merger.                                                                                        

In accordance with ASC 805, the Company expensed approximately $1.9 million of merger related costs during the period ended March 31, 2022, in addition to $7.1 million expensed in the year ended 2021.  The Company recorded goodwill of $48.5 million as a result of the combination.  Goodwill represents the future economic benefits arising from net assets acquired that are not individually identified and separately recognized and is attributable to synergies, including the reduction of  personnel and overlapping contracts, expected to be derived from the Company’s strategy to enhance and expand its presence in northeast Ohio.  The merger offers the Company the opportunity to increase profitability by introducing existing products and services to the acquired customer base as well as add new customers in the expanded market area.  The goodwill was determined not to be deductible for income tax purposes.

The following table summarizes the consideration paid for Cortland and the amounts of the assets acquired and liabilities assumed on the closing date of the acquisition.

(In Thousands of Dollars)
Consideration
Cash	$	29,618
Stock		98,921
Fair value of total consideration transferred	$	128,539
Fair value of assets acquired
Cash and cash equivalents	$	113,391
Securities available for sale		130,574
Other investments		16,092
Loans		482,168
Premises and equipment		12,644
Bank owned life insurance		21,547
Core deposit intangible		5,886
Current and deferred taxes		3,135
Other assets		7,805
Total assets acquired		793,242
Fair value of liabilities assumed
Deposits		695,274
Short-term borrowings		4,246
Long-term borrowings		4,262
Accrued interest payable and other liabilities		9,386
Total liabilities		713,168
Net assets acquired	$	80,074
Goodwill created		48,465
Total net assets acquired	$	128,539

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Securities

3 Months Ended

Mar. 31, 2022

Investments Debt And Equity Securities [Abstract]

Securities

Securities:

The following table summarizes the amortized cost and fair value of the available for sale investment securities portfolio at March 31, 2022 and December 31, 2021 and the corresponding amounts of unrealized gains and losses recognized in accumulated other comprehensive income:

			Gross		Gross
	Amortized		Unrealized		Unrealized
(In Thousands of Dollars)	Cost		Gains		Losses			Fair Value
March 31, 2022
U.S. Treasury and U.S. government sponsored entities	$	114,063	$	3	$	(9,119	)	$	104,947
State and political subdivisions		681,567		5,274		(41,233	)		645,608
Corporate bonds		4,399		4		(108	)		4,295
Mortgage-backed securities - residential		718,295		117		(54,717	)		663,695
Collateralized mortgage obligations - residential		41,039		21		(735	)		40,325
Small Business Administration		4,943		0		(187	)		4,756
Totals	$	1,564,306	$	5,419	$	(106,099	)	$	1,463,626

			Gross		Gross
	Amortized		Unrealized		Unrealized
(In Thousands of Dollars)	Cost		Gains		Losses			Fair Value
December 31, 2021
U.S. Treasury and U.S. government sponsored entities	$	93,137	$	32	$	(2,338	)	$	90,831
State and political subdivisions		636,724		23,296		(1,205	)		658,815
Corporate bonds		4,009		50		(29	)		4,030
Mortgage-backed securities - residential		663,405		1,875		(10,094	)		655,186
Collateralized mortgage obligations - residential		13,303		153		(71	)		13,385
Small Business Administration		5,381		49		0			5,430
Totals	$	1,415,959	$	25,455	$	(13,737	)	$	1,427,677

There were no sales of securities in the first quarter ended March 31, 2022.  Proceeds from the sale of portfolio securities were $26.2 million during the three month period ended March 31, 2021.  Gross gains of $406 thousand and gross losses of $23 thousand were realized on these sales during the three month period ended March 31, 2021.  In addition, $11 thousand of realized losses and $105 thousand of realized gains on equity securities were recognized in the income statement during the three month periods ended March 31, 2022 and March 31, 2021, respectively.

The amortized cost and fair value of the debt securities portfolio are shown in the table below by expected maturity.  Expected maturities may differ from contractual maturities if issuers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.

	March 31, 2022
(In Thousands of Dollars)	Amortized Cost		Fair Value
Maturity
Within one year	$	1,213	$	1,215
One to five years		14,507		14,683
Five to ten years		152,628		143,677
Beyond ten years		631,681		595,275
Mortgage-backed, collateralized mortgage obligations and Small Business Administration securities		764,277		708,776
Total	$	1,564,306	$	1,463,626

The following table summarizes the available for sale investment securities with unrealized losses at March 31, 2022 and December 31, 2021, aggregated by major security type and length of time in a continuous unrealized loss position.   

	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands of Dollars)	Value		Loss			Value		Loss			Value		Loss
March 31, 2022
U.S. Treasury and U.S. government sponsored entities	$	94,866	$	(8,125	)	$	9,753	$	(994	)	$	104,619	$	(9,119	)
State and political subdivisions		420,523		(38,939	)		14,420		(2,294	)		434,943		(41,233	)
Corporate bonds		1,009		(38	)		670		(70	)		1,679		(108	)
Mortgage-backed securities - residential		511,033		(42,169	)		110,117		(12,548	)		621,150		(54,717	)
Collateralized mortgage obligations - residential		18,856		(735	)		0		0			18,856		(735	)
Small Business Administration		4,756		(187	)		0		0			4,756		(187	)
Total temporarily impaired	$	1,051,043	$	(90,193	)	$	134,960	$	(15,906	)	$	1,186,003	$	(106,099	)

	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands of Dollars)	Value		Loss			Value		Loss			Value		Loss
December 31, 2021
U.S. Treasury and U.S. government sponsored entities	$	81,236	$	(1,960	)	$	8,271	$	(378	)	$	89,507	$	(2,338	)
State and political subdivisions		103,651		(1,020	)		10,020		(185	)		113,671		(1,205	)
Corporate bonds		418		(2	)		715		(27	)		1,133		(29	)
Mortgage-backed securities - residential		525,792		(7,872	)		55,569		(2,222	)		581,361		(10,094	)
Collateralized mortgage obligations - residential		7,270		(71	)		0		0			7,270		(71	)
Total temporarily impaired	$	718,367	$	(10,925	)	$	74,575	$	(2,812	)	$	792,942	$	(13,737	)

Allowance for Credit Losses

The Company adopted ASU 2016-13 prior to 2021, which made improvements to the accounting for credit losses on securities available for sale.  During the evaluation process, management considers the extent to which the fair value has been less than cost, the financial condition and near term prospects of the issuer, and the intent and ability of the Company to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value.      

If the Company determines that a credit loss exists, the credit portion of the allowance will be measured using a discounted cash flow analysis using the effective interest rate as of the security’s purchase date.  As of March 31, 2022, the Company’s security portfolio consisted of 879 securities, 595 of which were in an unrealized loss position.  The majority of the unrealized losses on the Company’s securities are related to its holdings of mortgage-backed securities and state and political subdivisions.  The Company does not consider its AFS securities with unrealized losses to be attributable to credit-related factors, as the unrealized losses have occurred as a result of changes in noncredit related factors such as changes in interest rates, market spreads and market conditions subsequent to purchase, not credit deterioration.  As of March 31, 2022 the Company has not recorded an allowance for credit losses on AFS securities.

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Loans

3 Months Ended

Mar. 31, 2022

Receivables [Abstract]

Loans

Loans:

Loan balances were as follows:

(In Thousands of Dollars)	March 31, 2022			December 31, 2021
Commercial real estate
Owner occupied	$	347,173		$	340,369
Non-owner occupied		540,194			533,240
Farmland		173,568			177,706
Other		113,605			138,282
Commercial
Commercial and industrial		298,903			313,836
Agricultural		51,277			54,659
Residential real estate
1-4 family residential		455,501			453,635
Home equity lines of credit		128,221			127,433
Consumer
Indirect		167,147			159,006
Direct		18,859			21,121
Other		6,580			9,395
Total originated loans	$	2,301,028		$	2,328,682
Net Deferred loan (fees) costs		3,943			2,400
Allowance for credit losses		(27,015	)		(29,386	)
Net loans	$	2,277,956		$	2,301,696

Allowance for credit loss activity

The following tables present the activity in the allowance for credit losses by portfolio segment for the three month period ended March 31, 2022 and 2021:

Three Months Ended March 31, 2022

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	15,879		$	4,949		$	4,870		$	3,688		$	29,386
Provision for credit losses		(672	)		271			(146	)		(383	)		(930	)
Loans charged off		0			(1,359	)		(34	)		(197	)		(1,590	)
Recoveries		0			6			12			131			149
Total ending allowance balance	$	15,207		$	3,867		$	4,702		$	3,239		$	27,015

Three Months Ended March 31, 2021

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	10,824		$	5,073		$	3,643		$	2,604		$	22,144
Impact of CECL adoption		(2,076	)		429			237			3,860			2,450
Provision for credit losses		96			(25	)		89			265			425
Loans charged off		0			(34	)		(67	)		(183	)		(284	)
Recoveries		0			7			59			134			200
Total ending allowance balance	$	8,844		$	5,450		$	3,961		$	6,680		$	24,935

The following table presents the recorded investment in nonaccrual and loans past due 90 days or more still on accrual by class of loans as of March 31, 2022 and December 31, 2021:

	March 31, 2022				December 31, 2021
(In Thousands of Dollars)	Nonaccrual		Loans Past Due 90 Days or More Still Accruing		Nonaccrual		Loans Past Due 90 Days or More Still Accruing
Commercial real estate
Owner occupied	$	416	$	0	$	433	$	0
Non-owner occupied		2,477		0		2,511		0
Farmland		271		0		274		0
Other		53		0		60		0
Commercial
Commercial and industrial		5,534		2		7,190		54
Agricultural		43		0		40		0
Residential real estate
1-4 family residential		2,940		671		3,363		459
Home equity lines of credit		928		0		917		36
Consumer
Indirect		456		52		455		123
Direct		180		23		227		53
Other		0		0		0		0
Total loans	$	13,298	$	748	$	15,470	$	725

The following tables present the aging of the recorded investment in past due loans as of March 31, 2022 and December 31, 2021 by class of loans.  Note that loans on a modification to defer payments under the CARES Act are included in loans not past due for the period ending December 31, 2021.  There were no loans on deferred payments at March 31, 2022.

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
March 31, 2022
Commercial real estate
Owner occupied	$	68	$	0	$	416	$	484	$	346,298	$	346,782
Non-owner occupied		1		0		2,477		2,478		537,157		539,635
Farmland		0		0		271		271		173,000		173,271
Other		0		0		53		53		113,294		113,347
Commercial
Commercial and industrial		185		5		5,536		5,726		292,823		298,549
Agricultural		137		53		43		233		51,296		51,529
Residential real estate
1-4 family residential		5,583		71		3,611		9,265		445,497		454,762
Home equity lines of credit		138		23		928		1,089		127,154		128,243
Consumer
Indirect		479		268		508		1,255		172,096		173,351
Direct		242		50		203		495		18,427		18,922
Other		1		0		0		1		6,579		6,580
Total loans	$	6,834	$	470	$	14,046	$	21,350	$	2,283,621	$	2,304,971

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
December 31, 2021
Commercial real estate
Owner occupied	$	70	$	591	$	433	$	1,094	$	338,880	$	339,974
Non-owner occupied		394		311		2,511		3,216		529,490		532,706
Farmland		0		0		274		274		177,143		177,417
Other		56		0		60		116		137,878		137,994
Commercial
Commercial and industrial		256		100		7,244		7,600		304,932		312,532
Agricultural		100		28		40		168		54,706		54,874
Residential real estate
1-4 family residential		4,452		1,077		3,822		9,351		443,441		452,792
Home equity lines of credit		80		12		953		1,045		126,405		127,450
Consumer
Indirect		795		275		578		1,648		163,112		164,760
Direct		203		91		280		574		20,614		21,188
Other		0		0		0		0		9,395		9,395
Total loans	$	6,406	$	2,485	$	16,195	$	25,086	$	2,305,996	$	2,331,082

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Troubled Debt Restructurings

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Troubled Debt Restructurings

Troubled Debt Restructurings

Total troubled debt restructurings were $3.8 million and $3.9 million at March 31, 2022, and December 31, 2021, respectively.  The Company has allocated $111 thousand and $109 thousand of specific reserves to loans whose terms have been modified in troubled debt restructurings at March 31, 2022, and December 31, 2021, respectively.  There were no commitments to lend additional amounts to borrowers with loans that were classified as troubled debt restructurings at March 31, 2022, and at December 31, 2021.

During the three month periods ended March 31, 2022 and 2021, the terms of certain loans were modified as troubled debt restructurings.  The modification of the terms of such loans included one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; a deferral of principal, interest and/or escrow; or a legal concession.  During the three month period ended March 31, 2022, the terms of such loans included a reduction of the stated interest rate of the loan of 3.345%.  During the same three month period in 2021, the terms of such loans included a reduction of the stated interest rate of the loan of 4.075% and an extension of the maturity date of 22 days.        

The following table presents loans by class modified as troubled debt restructurings that occurred during the three month period ended March 31, 2022 and 2021:

			Pre- Modification		Post- Modification
Three Months Ended March 31, 2022	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
1-4 family residential		1	$	50	$	52
Home equity lines of credit		1		14		14
Consumer
Indirect		1		14		14
Total loans		3	$	78	$	80

			Pre- Modification		Post- Modification
Three Months Ended March 31, 2021	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Commercial		4	$	22	$	22
Residential real estate
1-4 family residential		1		69		73
Home equity lines of credit		1		31		31
Consumer
Indirect		6		87		87
Total loans		12	$	209	$	213

There were no charge offs and no increase to the provision for credit losses during the three month period ended March 31, 2022 and  $20 thousand in charge offs and a $20 thousand increase to the provision for credit losses during the three month period ended March 31, 2021, as a result of outstanding troubled debt restructurings.        

There was  one residential real estate loan for which there was a payment default within twelve months following the modification of the troubled debt restructuring during the three month period ended March 31, 2022.  The loan was not past due at March 31, 2022.  There was no provision recorded as a result of the defaults during 2022.  A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.

There was one residential real estate loan for which there was a payment default within twelve months following the modification of the troubled debt restructuring during the three month period ended March 31, 2021.  The loan was not past due at March 31, 2021. There was no provision recorded as a result of the defaults during 2021.  A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.    

The Company offered three month deferrals upon request by the borrowers. For those borrowers in industries that were greatly impacted by COVID-19, additional deferrals were considered and granted beyond the initial three month period throughout 2021. The range of deferred months for subsequent requests were three to twelve months. The decline in deferred loans and balances was due to borrowers not requesting additional deferments and most continued to pay under the original terms of their loan. As of March 31, 2022 there are no longer borrowers on deferment due to COVID-19 related issues.

Farmers is also a preferred U.S. Small Business Administration (“SBA”) lender and dedicated significant additional staff and other resources to help our customers complete and submit their applications and supporting documentation for loans offered under the Paycheck Protection Program (“PPP”) under the CARES Act, so they could obtain SBA approval and receive funding as quickly as possible. During the period of the PPP program, the Company facilitated PPP assistance to 2,134 business customers totaling $256.4 million.  The Company, on behalf of its customers, began processing borrower applications for PPP forgiveness at the beginning of September 2020.  The SBA has up to ninety days to review an application for PPP forgiveness and provide a decision at the end of that review.  Once forgiveness of the PPP loan has been communicated and payment is received from the SBA, the Company will record the cash received from the SBA, pay-off the loans based on the amount of forgiveness provided and accelerate the amount of net deferred loan fees/costs recognized for the portion of the PPP loans that are forgiven.  During the period ended March 31, 2022, the Company has received life to date payments from the SBA for forgiveness of loans totaling $256.3 million, or approximately 99.98% of the PPP loans originated in 2020. The Company processed $107.9 million in new loans for PPP loan funding during 2021. The Company has also received payments from the SBA for forgiveness of loans totaling $84.9 million, or approximately 78.7%, of PPP loans originated in 2021.

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Credit Quality Indicators

3 Months Ended

Mar. 31, 2022

Risks And Uncertainties [Abstract]

Credit Quality Indicators

Credit Quality Indicators

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors.  The Company establishes a risk rating at origination for all commercial loan and commercial real estate relationships.  For relationships over $1 million, management monitors the loans on an ongoing basis for any changes in the borrower’s ability to service their debt.  Management also affirms the risk ratings for the loans in their respective portfolios on an annual basis.  The Company uses the following definitions for risk ratings:

Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention.  If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.  Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification.

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any.  Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt.  Substandard loans are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans.

As of March 31, 2022 and December 31, 2021, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

(In Thousands of Dollars)	Pass		Special Mention		Sub standard		Total
March 31, 2022
Commercial real estate
Owner occupied	$	338,256	$	4,430	$	4,096	$	346,782
Non-owner occupied		506,509		14,708		18,418		539,635
Farmland		170,456		2,145		670		173,271
Other		112,473		499		375		113,347
Commercial
Commercial and industrial		289,651		1,308		7,590		298,549
Agricultural		50,936		507		86		51,529
Total loans	$	1,468,281	$	23,597	$	31,235	$	1,523,113

(In Thousands of Dollars)	Pass		Special Mention		Sub standard		Total
December 31, 2021
Commercial real estate
Owner occupied	$	330,754	$	5,006	$	4,214	$	339,974
Non-owner occupied		495,170		19,366		18,170		532,706
Farmland		174,580		2,160		677		177,417
Other		137,063		784		147		137,994
Commercial
Commercial and industrial		301,879		1,190		9,463		312,532
Agricultural		54,394		397		83		54,874
Total loans	$	1,493,840	$	28,903	$	32,754	$	1,555,497

The Company considers the performance of the loan portfolio and its impact on the allowance for credit losses.  For residential, consumer indirect and direct loan classes, the Company evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity.  In the 1-4 family residential real estate portfolio at March 31, 2022, other real estate owned and foreclosure properties were $0 and $216 thousand, respectively.  At December 31, 2021, other real estate owned and foreclosure properties were $0 and $93 thousand, respectively.

The following tables present the recorded investment in residential, consumer indirect and direct auto loans based on payment activity as of March 31, 2022 and December 31, 2021.  Nonperforming loans are loans past due 90 days or more and still accruing interest and nonaccrual loans.

	Residential Real Estate				Consumer
(In Thousands of Dollars)	1-4 Family Residential		Home Equity Lines of Credit		Indirect		Direct		Other
March 31, 2022
Performing	$	451,151	$	127,315	$	172,843	$	18,719	$	6,580
Nonperforming		3,611		928		508		203		0
Total loans	$	454,762	$	128,243	$	173,351	$	18,922	$	6,580

	Residential Real Estate				Consumer
(In Thousands of Dollars)	1-4 Family Residential		Home Equity Lines of Credit		Indirect		Direct		Other
December 31, 2021
Performing	$	448,970	$	126,497	$	164,182	$	20,908	$	9,395
Nonperforming		3,822		953		578		280		6
Total loans	$	452,792	$	127,450	$	164,760	$	21,188	$	9,401

The following table presents total loans by risk categories and year of origination.

	Term Loans Amortized Cost Basis by Origination Year
As of March 31, 2022	2022		2021		2020		2019		2018		Prior		Revolving Loans		Total
Commercial real estate
Risk Rating
Pass	$	34,484	$	170,585	$	141,201	$	163,632	$	114,598	$	314,075	$	18,663	$	957,238
Special mention		0		788		0		6,924		2,020		9,387		518		19,637
Substandard		40		0		661		2,648		492		18,441		607		22,889
Total commercial real estate loans	$	34,524	$	171,373	$	141,862	$	173,204	$	117,110	$	341,903	$	19,788	$	999,764
Commercial
Risk Rating
Pass	$	28,559	$	80,860	$	46,807	$	25,005	$	20,084	$	24,321	$	64,015	$	289,651
Special mention		0		533		103		122		31		2		517		1,308
Substandard		399		1,984		1,676		265		257		1,890		1,119		7,590
Total commercial loans	$	28,958	$	83,377	$	48,586	$	25,392	$	20,372	$	26,213	$	65,651	$	298,549
Agricultural
Risk Rating
Pass	$	9,435	$	42,324	$	49,368	$	27,039	$	27,002	$	51,111	$	15,113	$	221,392
Special mention		0		0		227		31		0		2,045		349		2,652
Substandard		0		365		17		58		11		275		30		756
Total agricultural loans	$	9,435	$	42,689	$	49,612	$	27,128	$	27,013	$	53,431	$	15,492	$	224,800
Residential real estate
Risk Rating
Pass	$	19,699	$	102,254	$	86,118	$	36,861	$	29,617	$	167,930	$	3,706	$	446,185
Special mention		0		0		73		127		80		139		0		419
Substandard		0		46		100		89		30		7,893		0		8,158
Total residential real estate loans	$	19,699	$	102,300	$	86,291	$	37,077	$	29,727	$	175,962	$	3,706	$	454,762
Home equity lines of credit
Risk Rating
Pass	$	0	$	0	$	149	$	0	$	19	$	1,744	$	124,320	$	126,232
Special mention		0		0		0		0		0		0		48		48
Substandard		0		13		12		51		143		1,626		118		1,963
Total home equity lines of credit	$	0	$	13	$	161	$	51	$	162	$	3,370	$	124,486	$	128,243
Consumer
Risk Rating
Pass	$	24,827	$	58,540	$	42,425	$	30,910	$	18,087	$	17,561	$	5,408	$	197,758
Substandard		0		120		261		253		102		359		0		1,095
Total consumer loans	$	24,827	$	58,660	$	42,686	$	31,163	$	18,189	$	17,920	$	5,408	$	198,853

Purchased Loans

As a result of the Cortland Merger, the Company acquired $478.2 million in loans, excluding $4.0 million of loans held for sale.

Under ASU Topic 326, when loans are purchased with evidence of more than significant deterioration of credit, they are accounted for as purchase credit deteriorated (“PCD”).  PCD loans acquired in a transaction are marked to fair value and a mark on yield is recorded.  In addition, an adjustment is made to the ACL for the expected loss on the acquisition date.  These loans are assessed on a regular basis and subsequent adjustments to the ACL are recorded on the income statement.  During 2021, the Company acquired PCD loans with a fair value of $34.3 million, credit discount of $1.3 million and a noncredit discount of $1.1 million.  The outstanding balance at March 31, 2022 and related allowance on these loans is as follows:

	Loan Balance		ACL Balance
Commercial real estate
Owner Occupied	$	2,531	$	82
Non-owner Occupied		20,017		890
Other		780		36
		23,328		1,008
Commercial
Commercial and industrial		1,775		106
Residential real estate
1-4 family residential		500		4
Total	$	25,603	$	1,118

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Revenue from Contracts with Customers

3 Months Ended

Mar. 31, 2022

Revenue From Contract With Customer [Abstract]

Revenue from Contracts with Customers

Revenue from Contracts with Customers:

All material revenue from contracts with customers in the scope of ASC 606 is recognized within noninterest income.  The following table presents the Company’s noninterest income by revenue stream and reportable segment, net of eliminations, for the three months ended March 31, 2022 and 2021.

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Three Months Ended March 31, 2022
Service charges on deposit accounts	$	0	$	1,145	$	1,145
Debit card and EFT fees		0		1,416		1,416
Trust fees		2,519		0		2,519
Insurance agency commissions		0		1,047		1,047
Retirement plan consulting fees		397		0		397
Investment commissions		0		694		694
Other (outside the scope of ASC 606)		0		10,480		10,480
Total noninterest income	$	2,916	$	14,782	$	17,698

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Three Months Ended March 31, 2021
Service charges on deposit accounts	$	0	$	808	$	808
Debit card and EFT fees		0		1,171		1,171
Trust fees		2,236		0		2,236
Insurance agency commissions		0		1,003		1,003
Retirement plan consulting fees		320		0		320
Investment commissions		0		504		504
Other (outside the scope of ASC 606)		0		4,090		4,090
Total noninterest income	$	2,556	$	7,576	$	10,132

A description of the Company’s revenue streams under ASC 606 follows:

Service charges on deposit accounts – The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Management reviewed the deposit account agreements, and determined that the agreements can be terminated at any time by either the Bank or the account holder.  Transaction fees, such as balance transfers, wires and overdraft charges are settled the day the performance obligation is satisfied.  The Bank’s monthly service charges and maintenance fees are for services provided to the customer on a monthly basis and are considered a series of services that have the same pattern of transfer each month.  The review of service charges assessed on deposit accounts included the amount of variable consideration that is a part of the monthly charges.  It was found that the waiver of service charges due to insufficient funds and dormant account fees is immaterial and would not require a change in the accounting treatment for these fees under the new revenue standards.

Debit Card Interchange Fees – Customers and the Bank have an account agreement and maintain deposit balances with the Bank.  Customers use a bank issued debit card to purchase goods and services, and the Bank earns interchange fees on those transactions, typically a percentage of the sale amount of the transaction.  The Bank records the amount due when it receives the settlement from the payment network.  Payments from the payment network are received and recorded into income on a daily basis.  There are no contingent debit card interchange fees recorded by the Company that could be subject to a clawback in future periods.

Trust fees – Services provided to Trust customers are a series of distinct services that have the same pattern of transfer each month.  Fees for trust accounts are billed and drafted from trust accounts monthly.  The Company records these fees on the income statement on a monthly basis.  Fees are assessed based on the total investable assets of the customer’s trust account.  A signed contract between the Company and the customer is maintained for all customer trust accounts with payment terms identified.  It is probable that the fees will be collectible as funds being managed are accessible by the asset manager.  Past history of trust fee income recorded by the Company indicates that it is highly unlikely that a significant reversal could occur.  There are no contingent incentive fees recorded by the Company that could be subject to a clawback in future periods.

Insurance Agency Commissions – Insurance agency commissions are received from insurance carriers for the agency’s share of commissions from customer premium payments.  These commissions are recorded into income when checks are received from the insurance carriers, and there is no contingent portion associated with these commission checks.  There may be a short time-lag in recording revenue when cash is received instead of recording the revenue when the policy is signed by the customer, but the time lag is insignificant and does not impact the revenue recognition process.

Insurance also receives incentive checks from the insurance carriers for achieving specified levels of production with particular carriers.  These amounts are recorded into income when a check is received, and there are no contingent amounts associated with these payments that may be clawed back by the carrier in the future.  Similar to the monthly commissions explained in the preceding paragraph, there may be a short time-lag in recording incentive revenue on a cash basis as opposed to estimating the amount of incentive revenue expected to be earned, this does not materially impact the recognition of Insurance revenue.  If there were any amounts that would need to be refunded for one specific Insurance customer, management believes the reversal would not be significant.

Other potential situations surrounding the recognition of Insurance revenue include the estimating potential refunds due to the likely cancellation of a percentage of customers cancelling their policies and recording revenue at the time of policy renewals.  Management concluded that since Insurance agency commissions represent only 2.1% of the Company’s total revenue, adjusting the current practice of recording insurance revenue for these situations would not have a material impact on the reporting of total revenue.  

Retirement Plan Consulting Fees – Revenue is recognized based on the level of work performed for the client.  Any payments that are received for work to be performed in the future are recorded in a deferred revenue account, and recorded into income when the fees are earned.  Retirement plan consulting fees represent only 0.8% of the Company’s total revenue, and therefore management has concluded that any adjustment of revenue for one particular customer for a refund or any other reason would be insignificant and would not materially impact the Company’s total revenue.  

Investment Commissions – Investment commissions are earned through the sales of non-deposit investment products to customers of the Company.  The sales are conducted through a third-party broker-dealer.  When the commissions are received and recorded into income on the Bank’s income statement, there is no contingent portion that may need to be refunded back to the third party broker dealer.  Investment commissions represent only 1.4% of the Company’s total revenue, and therefore management has concluded that any adjustment of revenue for a particular customer for a refund or any other reason would be insignificant and would not materially impact the Company’s total revenue.  

Other – Income items included in “Other” are Bank owned life insurance income, security gains, net gains on the sale of loans and other operating income. There is also a one-time legal settlement of $8.4 million for the three month period ended March 31, 2022.  Any amounts within the scope of ASC 606 are deemed immaterial.

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Fair Value

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Fair Value

Fair Value:

Fair value is the exchange price that would be received for an asset, or paid to transfer a liability (exit price), in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.  There are three levels of inputs that may be used to measure fair values:

Level 1 – Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2 – Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3 – Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The Company used the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

Investment Securities: The Company uses a third party service to estimate fair value on available for sale securities on a monthly basis.  The Company’s service provider is considered a leading evaluation pricing service for U.S. domestic fixed income securities and values securities using exit pricing requirements.  They subscribe to multiple third-party pricing vendors, and supplement that information with matrix pricing methods.  The fair values for investment securities, which consist of equity securities that are recorded at fair market value to comply with exit pricing, are determined by quoted market prices in active markets, if available (Level 1).  The equity securities change in fair market value is recorded in the income statements.  For securities where quoted prices are not available, fair values are calculated based on quoted prices for similar assets in active markets, quoted prices for similar assets in markets that are not active or inputs other than quoted prices, which provide a reasonable basis for fair value determination.  Such inputs may include interest rates and yield curves, volatilities, prepayment speeds, credit risks and default rates.  Inputs used are derived principally from observable market data (Level 2).  For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3).  The fair values of Level 3 investment securities are determined by using unobservable inputs to measure fair value of assets for which there is little, if any market activity at the measurement date, using reasonable inputs and assumptions based on the best information at the time, to the extent that inputs are available without undue cost and effort.  For the period ended March 31, 2022 and for the year ended December 31, 2021, the fair value of Level 3 investment securities was immaterial.

Derivative Instruments: The fair values of derivative instruments are based on valuation models using observable market data as of the measurement date (Level 2).

Collateral Dependent Loans: Fair value estimates of collateral dependent loans that are individually reviewed are based on the fair value of the collateral, less estimated costs to sell.  Non-collateral dependent loans are valued based on discounted cash flows.  Loans carried at fair value generally receive specific allocations of the allowance for credit losses in the current period and allowance for loan losses in prior periods.  For collateral dependent loans, fair value is commonly based on recent real estate appraisals.  These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach.  Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available.  Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value.  Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification.  These loans are evaluated on a quarterly basis and adjusted accordingly.

Other Real Estate Owned: Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis.  These assets are subsequently accounted for at lower of cost or fair value less estimated costs to sell. Fair values are commonly based on recent real estate appraisals.  These appraisals may use a single valuation approach or a combination of approaches including comparable sales and the income approach.  Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available.  Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value.

Appraisals for both collateral-dependent impaired loans and other real estate owned are performed by certified general appraisers (for commercial and commercial real estate properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company.  Once received, a member of the Appraisal Department reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison with independent data sources such as recent market data or industry-wide statistics.  On an annual basis, the Company compares the actual selling price of collateral that has been sold to the most recent appraised value to determine what adjustments should be made to appraisals to arrive at fair value.

Assets measured at fair value on a recurring basis are summarized below:

			Fair Value Measurements at March 31, 2022 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investment securities available-for sale
U.S. Treasury and U.S. government sponsored entities	$	104,947	$	0	$	104,947	$	0
State and political subdivisions		645,608		0		645,608		0
Corporate bonds		4,295		0		4,295		0
Mortgage-backed securities-residential		663,695		0		663,693		2
Collateralized mortgage obligations		40,325		0		40,325		0
Small Business Administration		4,756		0		4,756		0
Equity securities
Equity securities at fair value		217		217		0		0
Other investments measured at net asset value		14,723	n/a		n/a		n/a
Total investment securities	$	1,478,566	$	217	$	1,463,624	$	2
Interest rate swaps	$	2,232	$	0	$	2,232	$	0
Financial Liabilities
Interest rate swaps	$	2,232	$	0	$	2,232	$	0

			Fair Value Measurements at December 31, 2021 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices  in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investment securities available-for sale
U.S. Treasury and U.S. government sponsored entities	$	90,831	$	0	$	90,831	$	0
State and political subdivisions		658,815		0		658,815		0
Corporate bonds		4,030		0		4,030		0
Mortgage-backed securities-residential		655,186		0		655,183		3
Collateralized mortgage obligations		13,385		0		13,385		0
Small Business Administration		5,430		0		5,430		0
Equity securities
Equity securities at fair value		228		228		0		0
Other investments measured at net asset value		14,721	n/a		n/a		n/a
Total investment securities	$	1,442,626	$	228	$	1,427,674	$	3
Interest rate swaps	$	4,261	$	0	$	4,261	$	0
Financial Liabilities
Interest rate swaps	$	4,261	$	0	$	4,261	$	0

There were no significant transfers between Level 1 and Level 2 during the three month period ended March 31, 2022 and 2021.

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3):

	Investment Securities Available-for-sale (Level 3)
	Three Months ended March 31,
(In Thousands of Dollars)	2022			2021
Beginning Balance	$	3		$	4
Transfers from level 2		0			0
Repayments, calls and maturities		(1	)		0
Ending Balance	$	2		$	4

Assets measured at fair value on a non-recurring basis are summarized below:

			Fair Value Measurements at March 31, 2022 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices  in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Individually evaluated loans
1–4 family residential	$	82	$	0	$	0	$	82
Consumer indirect		14		0		0		14

			Fair Value Measurements at December 31, 2021 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Individually Evaluated loans
Commercial	$	1,654	$	0	$	0	$	1,654
1–4 family residential		82		0		0		82

Collateral dependent loans were individually evaluated under ASC 326 for the periods ending March 31, 2022 and December 31, 2021.  Collateral dependent loans had a principal balance of $893 thousand with a valuation allowance of $797 thousand at March 31, 2022.  Collateral dependent loans had a principal balance of $3.2 million with a valuation allowance of $1.5 million at December 31, 2021.  Excluded from the above tables at March 31, 2022 and December 31, 2021, are $850 thousand and $792 thousand of loans classified as troubled debt restructurings and measured using the present value of cash flows, which is not considered an exit price.

Collateral dependent commercial real estate loans, both owner-occupied and non-owner occupied are valued by independent external appraisals.  These external appraisals are prepared using the sales comparison approach and income approach valuation techniques.  Management makes subsequent unobservable adjustments to the collateral dependent loan appraisals.  Collateral dependent loans other than commercial real estate and other real estate owned are not considered material.

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at the periods ended March 31, 2022 and December 31, 2021:

March 31, 2022	Fair value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individually evaluated loans
Residential		82	Sales comparison	Adjustment for differences between comparable sales	(3.84%) - 3.22% (0.12%)
Consumer indirect		14	Sales comparison	Adjustment for differences between comparable sales	(6.08%) - 6.08% 0.00%

December 31, 2021	Fair value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individually evaluated loans
Commercial	$	1,654	Sales comparison	Adjustment for differences between comparable sales	(40.24%) - 56.83% (12.43%)
Residential		82	Sales comparison	Adjustment for differences between comparable sales	(3.84%) - 3.22% (0.12%)

The carrying amounts and estimated fair values of financial instruments not previously disclosed at March 31, 2022 and December 31, 2021 are as follows:

			Fair Value Measurements at March 31, 2022 Using:
(In Thousands of Dollars)	Carrying Amount		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	137,627	$	29,224	$	108,403	$	0	$	137,627
Regulatory stock		19,080	n/a		n/a		n/a		n/a
Loans held for sale		1,904		0		1,942		0		1,942
Loans, net		2,277,956		0		0		2,254,714		2,254,714
Financial liabilities
Deposits		3,693,811		3,283,963		397,903		0		3,681,866
Long-term borrowings		87,872		0		84,946		0		84,946

			Fair Value Measurements at December 31, 2021 Using:
(In Thousands of Dollars)	Carrying Amount		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	112,790	$	29,150	$	83,640	$	0	$	112,790
Regulatory stock		15,510	n/a		n/a		n/a		n/a
Loans held for sale		4,545		0		4,681		0		4,681
Loans, net		2,301,696		0		0		2,285,554		2,285,554
Financial liabilities
Deposits		3,547,235		3,158,967		384,263		0		3,543,230
Long-term borrowings		87,758		0		92,433		0		92,433

The methods and assumptions used to estimate fair value, not previously described, are described as follows:

Cash and Cash Equivalents: The carrying amounts of cash and short-term instruments approximate fair values and are classified as Level 1.

Regulatory Stock: It is not practical to determine the fair value of regulatory stock due to restrictions placed on its transferability.

Loans: Fair values of loans, excluding loans held for sale, are estimated as follows: The Company uses a third party firm that uses cash flow analysis and current market interest rates along with adjustments for credit, liquidity and option risk to conform to the ASU 2016-01 exit price requirement.  Loans in the tables above consist of impaired credits held for investment.  Fair value for collateral dependent loans is based upon appraised values adjusted for trends observed in the market, less estimated cost to sell. The cash flow method is used for estimating fair value for noncollateral dependent loans. A valuation allowance was recorded for the excess of the loan’s recorded investment over the amounts determined by the collateral value method. This valuation is a component of the allowance for credit losses. The Company considers these fair values Level 3.

Loans held for sale: The fair value of loans held for sale is estimated based upon binding contracts and quotes from third party investors resulting in a Level 2 classification.

Deposits: The fair values disclosed for demand deposits – interest and non-interest checking, passbook savings, and money market accounts – are, by definition, equal to the amount payable on demand at the reporting date resulting in a Level 1 classification.  The carrying amounts of variable rate certificates of deposit approximate their fair values at the reporting date resulting in a Level 2 classification.  Fair value for fixed rate certificates of deposit are estimated using a discounted cash flows calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities on time deposits resulting in a Level 2 classification.

Short-term Borrowings: The carrying amounts of federal funds purchased, borrowings under repurchase agreements, and other short-term borrowings, generally maturing within ninety days, approximate their fair values resulting in a Level 2 classification.

Long-term Borrowings: The fair values of the Company’s long-term borrowings are estimated using discounted cash flow analyses based on the current borrowing rates for similar types of borrowing arrangements resulting in a Level 2 classification.

Off-balance Sheet Instruments: The fair value of commitments is not considered material.

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Goodwill and Intangible Assets

3 Months Ended

Mar. 31, 2022

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Goodwill and Intangible Assets:

Goodwill associated with the Company’s acquisition of Cortland in November 2021 and other past acquisitions totaled $94.2 million at March 31, 2022 and December 31, 2021.  Impairment exists when a reporting unit’s carrying value of goodwill exceeds its fair value, which is determined through a two-step impairment test. Management performs goodwill impairment testing on an annual basis as of September 30.  The fair value of the reporting units is determined using a combination of a discounted cash flow method and a guideline public company method.  Results of the assessment indicated no goodwill impairment as of September 30, 2021.  The Company will continue to monitor its goodwill for possible impairment.  

Acquired Intangible Assets

Acquired intangible assets were as follows:

	March 31, 2022					December 31, 2021
(In Thousands of Dollars)	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Amortized intangible assets:
Customer relationship intangibles	$	7,210	$	(6,679	)	$	7,210	$	(6,641	)
Non-compete contracts		430		(393	)		430		(392	)
Trade name		520		(364	)		520		(356	)
Core deposit intangible		12,866		(5,643	)		12,866		(5,271	)
Total	$	21,026	$	(13,079	)	$	21,026	$	(12,660	)

Aggregate amortization expense was $420 thousand for the three month period ended March 31, 2022 and $316 thousand for the three month period ended March 31, 2021.

Estimated amortization expense for each of the next five periods and thereafter:

2022 (9 months)	$	1,251
2023		1,198
2024		894
2025		833
2026		741
Thereafter		3,030
Total	$	7,947

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Leases

3 Months Ended

Mar. 31, 2022

Leases [Abstract]

Leases

Leases:

The Company has operating leases for branch office locations, vehicles and certain office equipment such as printers, copiers and faxes. The leases have remaining lease terms of up to 18 years, some of which include options to extend the lease for up to 15 years and some of which include options to terminate the lease in 1.1 years. 

The right of use asset and lease liability were $6.1 million and $6.4 million as of March 31, 2022 and $6.4 million and $6.6 million at December 31, 2021.

Lease payments made for the three month period ended March 31, 2022, were $237 thousand and $202 thousand for the three month period ended March 31, 2021.  Interest expense and amortization expense on finance leases for the three month period ended March 31, 2022, was $38 thousand and $166 thousand.  Interest expense and amortization expense on finance leases for the three month period ended March 31, 2021, was $36 thousand and $121 thousand.  The average remaining lease term for all leases was 5.95 years as of March 31, 2022 and the weighted-average discount rate was 2.43%.

Maturities of lease liabilities are as follows as of March 31, 2022:

2022 (9 months)	$	596
2023		780
2024		610
2025		603
2026		586
Thereafter		4,245
Total Payments		7,420
Less: Imputed Interest		(1,035	)
Total	$	6,385

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Derivative Financial Instruments

3 Months Ended

Mar. 31, 2022

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

Derivative Financial Instruments:

Interest Rate Swaps

The Company maintains an interest rate protection program for commercial loan customers. Under this program, the Company provides a variable rate loan while creating a fixed rate loan for the customer by the customer entering into an interest rate swap with terms that match the loan. The Company offsets its risk exposure by entering into an offsetting interest rate swap with an unaffiliated institution. The Company had interest rate swaps associated with commercial loans with a notional value of $74.9 million and fair value of $2.2 million in other assets and $2.2 million in other liabilities at March 31, 2022. At December 31, 2021 the Company had interest rate swaps associated with commercial loans with and a notional value of $86.1 million and fair value of $4.0 million in other assets and $4.0 million in other liabilities. The interest rate swaps with both the customers and third parties are not designated as hedges under FASB ASC 815 and are not marked to market through earnings. As the interest rate swaps are structured to offset each other, changes to the underlying benchmark interest rates considered in the valuation of these instruments do not result in an impact to earnings; however, there may be fair value adjustments related to credit quality variations between counterparties, which may impact earnings as required by FASB ASC 820.

There were no net gains or losses for interest rate swaps for the period ended March 31, 2022 or December 31, 2021.

Mortgage Banking Derivatives

Commitments to fund certain mortgage loans (interest rate locks) to be sold into the secondary market are considered derivatives. These mortgage banking derivatives are not designated in hedge relationships.  The Company had approximately $13.6 million of interest rate lock commitments at March 31, 2022 and $25.7 million of interest rate lock commitments at December 31, 2021.

The net gains and losses on derivative instruments not designated as hedging instruments are included in mortgage banking income.  For the quarter ended March 31, 2022, losses of $286,000 were included in mortgage banking income for the interest rate lock commitments.  For the fiscal year ended December 31, 2021, gains of $423,000 were included in mortgage banking income for the interest rate lock commitments.

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Earnings Per Share

3 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share:

The computation of basic and diluted earnings per share is shown in the following table:

	Three Months Ended March 31,
	2022		2021
Basic EPS
Net income (In thousands)	$	15,844	$	14,556
Weighted average shares outstanding		33,820,485		28,215,772
Basic earnings per share	$	0.47	$	0.52
Diluted EPS
Net income (In thousands)	$	15,844	$	14,556
Weighted average shares outstanding for basic earnings per share		33,820,485		28,215,772
Dilutive effect of restricted stock awards		116,453		120,367
Weighted average shares for diluted earnings per share		33,936,938		28,336,139
Diluted earnings per share	$	0.47	$	0.51

There were 132,492 and 68,311 restricted stock awards that were considered anti-dilutive for the three month periods ended March 31, 2022 and 2021, respectively.

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Stock Based Compensation

3 Months Ended

Mar. 31, 2022

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock Based Compensation

Stock Based Compensation:

During 2017, the Company, with the approval of shareholders, created the 2017 Equity Incentive Plan (the “2017 Plan”).  The 2017 Plan permits the award of up to 800 thousand shares to the Company’s directors and employees to attract and retain exceptional personnel, motivate performance and most importantly to help align the interests of the Company’s executives with those of the Company’s shareholders.  There were 75,768 service time based share awards and 56,724 performance based share awards granted under the 2017 Plan during the three month period ended March 31, 2022, as shown in the table below.  The actual number of performance based shares issued will depend on the relative performance of the Company’s average return on equity compared to a group of peer companies over a three year vesting period, ending December 31, 2024.  As of March 31, 2022, 137,383 shares are still available to be awarded from the 2017 Plan.  

In April of 2022, the Company, with the approval of shareholders, approved the 2022 Equity Incentive Plan (the “2022 Plan”).  The 2022 Plan permits the award of up to one million shares to the Company’s directors and employees.  The 2022 Plan will replace the 2017 Plan.

The restricted stock awards were granted with a fair value price equal to the market price of the Company’s common stock at the date of the grant.  Expense recognized was $365 thousand and $330 thousand for the three month periods ended March 31, 2022 and 2021, respectively.  As of March 31, 2022, there was $3.7 million of total unrecognized compensation expense related to the nonvested shares granted under the Plan.  The remaining cost is expected to be recognized over 2.9 years.  

The following is the activity under the Plans during the three month period ended March 31, 2022.

	Maximum Awarded Service Units			Weighted Average Grant Date Fair Value		Maximum Awarded Performance Units			Weighted Average Grant Date Fair Value
Beginning balance - non-vested shares		99,564		$	16.13		158,988		$	14.40
Granted		75,768			17.69		56,724			17.25
Vested		(15,771	)		17.29		(65,481	)		17.48
Forfeited		0			0.00		(12,862	)		14.74
Ending balance - non-vested shares		159,561		$	17.13		137,369		$	15.85

The following is the activity under the Plans during the three month period ended March 31, 2021.

	Maximum Awarded Service Units			Weighted Average Grant Date Fair Value		Maximum Awarded Performance Units			Weighted Average Grant Date Fair Value
Beginning balance - non-vested shares		67,765		$	14.32		153,070		$	14.46
Granted		19,062			14.36		52,249			14.09
Vested		(13,081	)		14.34		(52,327	)		14.34
Forfeited		(2,000	)		13.55		0			0
Ending balance - non-vested shares		71,746		$	14.35		152,992		$	14.37

The 81,252 shares that vested during the three month period ended March 31, 2022 had a weighted average fair value of $17.44 per share.

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Other Comprehensive Income (Loss)

3 Months Ended

Mar. 31, 2022

Comprehensive Income Net Of Tax [Abstract]

Other Comprehensive Income (Loss)

Other Comprehensive Income (Loss):

The following tables represent the details of other comprehensive income for the three month periods ended March 31, 2022 and 2021.

	Three Months Ended March 31, 2022
(In Thousands of Dollars)	Pre-tax			Tax		After-Tax
Unrealized holding losses on available-for-sale securities during the period	$	(112,398	)	$	23,605	$	(88,793	)
Reclassification adjustment for gains included in net income (1)		0			0		0
Net unrealized losses on available-for-sale securities	$	(112,398	)	$	23,605	$	(88,793	)
Change in funded status of post-retirement health plan		(2	)		0		(2	)
Net other comprehensive loss	$	(112,400	)	$	23,605	$	(88,795	)
	Three Months Ended March 31, 2021
(In Thousands of Dollars)	Pre-tax			Tax		After-Tax
Unrealized holding losses on available-for-sale securities during the period	$	(14,934	)	$	3,136	$	(11,798	)
Reclassification adjustment for gains included in net income (1)		(383	)		81		(302	)
Net other comprehensive loss	$	(15,317	)	$	3,217	$	(12,100	)

(1) Pre-tax reclassification adjustments relating to available-for-sale securities are reported in security gains and the tax impact is included in income tax expense on the consolidated statements of income.

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Regulatory Capital Matters

3 Months Ended

Mar. 31, 2022

Regulatory Capital Requirements [Abstract]

Regulatory Capital Matters

Regulatory Capital Matters:

Banks and bank holding companies are subject to various regulatory capital requirements administered by the federal banking agencies.  Capital adequacy guidelines and, additionally for banks, prompt corrective action regulations, involve quantitative measures of assets, liabilities, and certain off-balance sheet items calculated under regulatory accounting practices.  Capital amounts and classifications are also subject to qualitative judgments by regulators.  Failure to meet capital requirements can initiate regulatory action by regulators that, if undertaken, could have a direct material effect on the financial statements.  Management believes that as of March 31, 2022, the Company and the Bank meet all capital adequacy requirements to which they are subject.

The FDIC and other federal banking regulators revised the risk-based capital requirements applicable to financial holding companies and insured depository institutions, including the Company and the Bank, to make them consistent with agreements that were reached by the Basel Committee on Banking Supervision (“Basel III”).

The common equity tier 1 capital, tier 1 capital and total capital ratios are calculated by dividing the respective capital amounts by risk-weighted assets.  The leverage ratio is calculated by dividing tier 1 capital by adjusted average total assets.

Basel III limits capital distributions and certain discretionary bonus payments if the banking organization does not hold a “capital conservation buffer” consisting of 2.5% of common equity tier 1 capital, tier 1 capital and total capital to risk-weighted assets in addition to the amount necessary to meet minimum risk-based capital requirements.  Excluding the additional buffer, Basel III requires the Company and the Bank to maintain (i) a minimum ratio of common equity tier 1 capital to risk-weighted assets of at least 4.5%, (ii) a minimum ratio of tier 1 capital to risk-weighted assets of at least 6.0%, (iii) a minimum ratio of total capital to risk-weighted assets of at least 8.0% and (iv) a minimum leverage ratio of at least 4.0%.

Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized, although these terms are not used to represent overall financial condition.  If only adequately capitalized, regulatory approval is required to accept brokered deposits.  If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required.  At March 31, 2022 and December 31, 2021, the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for prompt corrective action.  There are no conditions or events since that notification that management believes have changed the institution’s category.

Actual and required capital amounts and ratios, which do not include the capital conservation buffer, are presented below at March 31, 2022 and December 31, 2021:

	Actual					Requirement For Capital Adequacy Purposes:					To be Well Capitalized Under Prompt Corrective Action Provisions:
	Amount		Ratio			Amount		Ratio			Amount		Ratio
March 31, 2022
Common equity tier 1 capital ratio
Consolidated	$	373,543		13.31	%	$	126,292		4.5	%	N/A		N/A
Bank		355,986		12.75	%		125,692		4.5	%		181,555		6.5	%
Total risk based capital ratio
Consolidated		493,558		17.59	%		224,519		8.0	%	N/A		N/A
Bank		383,001		13.71	%		223,452		8.0	%		279,315		10.0	%
Tier 1 risk based capital ratio
Consolidated		391,543		13.95	%		168,389		6.0	%	N/A		N/A
Bank		355,986		12.75	%		167,589		6.0	%		223,452		8.0	%
Tier 1 leverage ratio
Consolidated		391,543		9.56	%		163,860		4.0	%	N/A		N/A
Bank		355,986		8.72	%		163,207		4.0	%		204,009		5.0	%
December 31, 2021
Common equity tier 1 capital ratio
Consolidated	$	362,950		13.16	%	$	124,066		4.5	%	N/A		N/A
Bank		345,065		12.55	%		123,712		4.5	%	$	178,695		6.5	%
Total risk based capital ratio
Consolidated		485,336		17.60	%		220,562		8.0	%	N/A		N/A
Bank		374,451		13.62	%		219,933		8.0	%		274,916		10.0	%
Tier 1 risk based capital ratio
Consolidated		380,950		13.82	%		165,422		6.0	%	N/A		N/A
Bank		345,065		12.55	%		164,950		6.0	%		219,933		8.0	%
Tier 1 leverage ratio
Consolidated		380,950		10.12	%		150,629		4.0	%	N/A		N/A
Bank		345,065		9.19	%		150,217		4.0	%		187,772		5.0	%

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Segment Information

3 Months Ended

Mar. 31, 2022

Segment Reporting [Abstract]

Segment Information

Segment Information:

The reportable segments are determined by the products and services offered, primarily distinguished between banking and trust.  These segments are also distinguished by the level of information provided to the chief operating decision makers in the Company, who use such information to review performance of various components of the business, which are then aggregated.  Loans, investments, and deposits provide the revenues in the banking operation.  All operations are domestic.  Significant segment totals are reconciled to the financial statements as follows:

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
March 31, 2022
Goodwill and other intangibles	$	5,796	$	100,654	$	(4,263	)	$	102,187
Total assets	$	19,548	$	4,182,798	$	3,509		$	4,205,855

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
December 31, 2021
Goodwill and other intangibles	$	5,814	$	101,055	$	(4,263	)	$	102,606
Total assets	$	14,365	$	4,124,530	$	3,854		$	4,142,749

(In Thousands of Dollars)	Trust Segment		Bank Segment			Eliminations and Others			Consolidated Totals
For Three Months Ended March 31, 2022
Net interest income	$	34	$	31,993		$	(785	)	$	31,242
Provision for credit losses and unfunded loans		0		(358	)		0			(358	)
Service fees, security gains and other noninterest income		9,198		8,741			(241	)		17,698
Noninterest expense		1,769		27,442			83			29,294
Amortization and depreciation expense		28		1,134			0			1,162
Income before taxes		7,435		12,516			(1,109	)		18,842
Income taxes		1,562		1,734			(298	)		2,998
Net income	$	5,873	$	10,782		$	(811	)	$	15,844

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
For Three Months Ended March 31, 2021
Net interest income	$	31	$	25,290	$	(54	)	$	25,267
Provision for credit losses and unfunded loans		0		425		0			425
Service fees, security gains and other noninterest income		2,603		7,514		15			10,132
Noninterest expense		1,556		15,181		(218	)		16,519
Amortization and depreciation expense		64		666		68			798
Income before taxes		1,014		16,532		111			17,657
Income taxes		212		2,947		(58	)		3,101
Net income	$	802	$	13,585	$	169		$	14,556

The Bank segment includes Farmers National Insurance and Farmers of Canfield Investment Co.

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Short-term Borrowings

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Short-term Borrowings

Short-term borrowings:

The Bank had no short-term advances from the FHLB at March 31, 2022 or December 31, 2021.

The Bank has access to lines of credit amounting to $35 million at two major domestic banks that are below prime rate. The lines and terms are periodically reviewed by the lending banks and are generally subject to withdrawal at their discretion. There were no borrowings under these lines at March 31, 2022 or at December 31, 2021.

Farmers has two unsecured revolving lines of credit for $6.5 million. These lines can be renewed annually. The lines have interest rates of prime with floors of 3.5% and 4.5%. There were no outstanding balances on either of these two lines at March 31, 2022 or at December 31, 2021, respectively.

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Long-Term Borrowings

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Long-term Borrowings

Long-term borrowings:

There were no long-term advances from the FHLB at March 31, 2022 or at December 31, 2021.

The Bank’s long-term and short-term FHLB advances are secured by a blanket pledge of residential mortgage, commercial real estate, and multi-family loans totaling $1.3 billion and $1.2 billion at March 31, 2022 and December 31, 2021.  Based on this collateral, the Bank is eligible to borrow an additional $679.8 million at March 31, 2022.  

In November 2021, the Company completed the issuance of $75.0 million aggregate principal amount, fixed-to-floating rate subordinated notes due December 15, 2031, in a private offering exempt from the registration requirements under the Securities Act of 1933, as amended.  The notes carry a fixed rate of 3.125% for five years at which time they will convert to a floating rate based on the three-month term secured overnight funding rate, plus a spread of 220 basis points.  The Company may, at its option, beginning December 15, 2026, redeem the notes, in whole or in part, from time to time, subject to certain conditions.  The net proceeds from the sale were approximately $73.8 million, after deducting the offering expenses.  The Company’s intent was to use the proceeds from the sale for general corporate purposes, which may include, without limitation, providing capital to support its growth organically or through acquisitions, in financing investments, capital expenditures, repurchasing its common shares and for investments in the Bank as regulatory capital.  The subordinated debentures are included in Total Capital under current regulatory guidelines and interpretations.

On November 1, 2021, the Company completed its acquisition of Cortland, which included the assumption of Floating Rate Junior Subordinated Debt Securities due in September 15, 2037 (the "junior subordinated debt securities") at an acquisition-date fair value of $4.3 million, held in a wholly-owned statutory trust whose common securities were wholly-owned by Cortland. The sole assets of the statutory trust are the junior subordinated debt securities and related payments. The junior subordinated debt securities and the back-up obligations, in the aggregate, constitute a full and unconditional guarantee of the obligations of the statutory trust under the capital securities held by third-party investors. The securities bear interest at a rate of 1.45% over the 3-month LIBOR rate.  The rate at March 31, 2022 was 2.28% and at December 31, 2021 was 1.65%.

On January 7, 2020, the Company completed its acquisition of Maple Leaf, which included the assumption of Floating Rate Junior Subordinated Debt Securities due December 15, 2036 (the "junior subordinated debt securities") held in a wholly-owned statutory trust whose common securities were wholly-owned by Maple Leaf. The sole assets of the statutory trust are the junior subordinated debt securities and related payments. The junior subordinated debt securities and the back-up obligations, in the aggregate, constitute a full and unconditional guarantee of the obligations of the statutory trust under the capital securities held by third-party investors. The securities bear interest at a rate of 1.70% over the 3-month LIBOR rate.  The rate at March 31, 2022 was 2.63% and at December 31, 2021 was 1.90%.

In 2015, the Company completed its acquisition of National Bancshares Corporation (“NBOH”), which included the assumption of Floating Rate Junior Subordinated Debt Securities due June 15, 2035 (the "junior subordinated debt securities") held in a wholly-owned statutory trust whose common securities were wholly-owned by NBOH. The sole assets of the statutory trust are the junior subordinated debt securities and related payments. The junior subordinated debt securities and the back-up obligations, in the aggregate, constitute a full and unconditional guarantee of the obligations of the statutory trust under the capital securities held by third-party investors. The securities bear interest at a rate of 1.80% over the 3-month LIBOR rate.  The rate at March 31, 2022 was 2.53% and at December 31, 2021 was 2.00%.

In all three instances, the Company may redeem the junior subordinated debentures at any quarter-end, in whole, or in part, at par.  This type of subordinated debenture qualifies as Tier 1 capital for regulatory purposes in determining and evaluating the Company’s capital adequacy.

A summary of all junior subordinated debentures issued by the Company to affiliates and subordinated debentures follows.  For the junior subordinated debentures, these amounts represent the par value of the obligations owed to these affiliates, including the Company’s equity interest in the trusts along with any unamortized fair value marks.  For the subordinated debentures, these amounts represent the par value less the remaining deferred offering expense associated with the issuance of the debentures.  

	March 31, 2022	December 31, 2021
	Amount	Amount
TSEO Statutory Trust I	$2,436	$2,424
Maple Leaf Financial Statutory Trust II	7,349	7,293
Cortland Statutory Trust I	4,285	4,271
Total junior subordinated debentures owed to unconsolidated subsidiary trusts	$14,070	$13,988
Subordinated debentures	$73,802	$73,770

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Principles of Consolidation

Principles of Consolidation:

Farmers National Banc Corp. (“Company”) is a Financial Holding Company registered under the Bank Holding Company Act of 1956, as amended.  The Company provides full banking services through its nationally chartered subsidiary, The Farmers National Bank of Canfield (“Bank”).  The consolidated financial statements also include the accounts of the Bank’s subsidiaries; Farmers National Insurance, LLC (“Insurance”) and Farmers of Canfield Investment Co. (“Investments”).  The Company provides trust and retirement consulting services through its subsidiary, Farmers Trust Company (“Trust”), and insurance services through the Bank’s subsidiary, Insurance.  Farmers National Captive, Inc. (“Captive”) is a wholly-owned insurance subsidiary of the Company that provides property and casualty insurance coverage to the Company and its subsidiaries.  The Captive pools resources with eleven similar insurance company subsidiaries of financial institutions to spread a limited amount of risk among themselves and to provide insurance where not currently available or economically feasible in today’s insurance market place.  The consolidated financial statements include the accounts of the Company, the Bank and its subsidiaries, along with the Trust and Captive.  All significant intercompany balances and transactions have been eliminated in the consolidation.

Basis of Presentation

Basis of Presentation:

The unaudited condensed consolidated financial statements have been prepared in conformity with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements.  The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2021 Annual Report to Shareholders included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 (“2021 Form 10-K”).  The interim consolidated financial statements include all adjustments (consisting of only normal recurring items) that, in the opinion of management, are necessary for a fair presentation of the financial position and results of operations for the periods presented.  The results of operations for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year.  Certain items included in the prior period financial statements were reclassified to conform to the current period presentation. There was no effect on net income or total stockholders’ equity.

Estimates

Estimates:

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Segments

Segments:

The Company provides a broad range of financial services to individuals and companies in northeastern Ohio and western Pennsylvania.  Operations are managed and financial performance is primarily aggregated and reported in two lines of business, the Bank segment and the Trust segment.

Equity

Equity:

There are 50,000,000 shares authorized and available for issuance as of March 31, 2022.  Outstanding shares at March 31, 2022 were 34,007,677.

Comprehensive Income

Comprehensive Income:

Comprehensive income consists of net income and other comprehensive income.  Other comprehensive income consists of unrealized gains and losses on securities available for sale and changes in the funded status of the post-retirement plan, which are recognized as components of stockholders’ equity, net of tax effect.

New Accounting Standard

New Accounting Standard:

On March 31, 2022, FASB issued ASU 2022-2, which eliminates the troubled debt restructuring (“TDR”), accounting model for creditors that have adopted Topic 326, Financial Instruments – Credit Losses.”  Due to the removal of the TDR accounting model, all loan modifications now will be accounted for under the general loan modification guidance in Subtopic 310-20.  In addition, on a prospective basis, entities will be subject to new disclosure requirements covering modifications of receivables to borrowers experiencing financial difficulty.  Public business entities within the scope of the Topic 326 vintage disclosure requirements also will be required to prospectively disclose current-period gross write-off information by vintage, or year of origination.  For entities that have adopted Topic 326, ASU 2022-02 takes effect in reporting periods beginning after December 15, 2022.  Early adoption is permitted.  The Company has not elected to early adopt this ASU at this time.  The adoption of this standard is not expected to have a material effect on the Company’s operating results or financial condition.

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Business Combinations (Tables)

3 Months Ended

Mar. 31, 2022

Cortland Bank

Summary of Consideration Paid and Amounts of Assets Acquired and Liabilities Assumed

(In Thousands of Dollars)
Consideration
Cash	$	29,618
Stock		98,921
Fair value of total consideration transferred	$	128,539
Fair value of assets acquired
Cash and cash equivalents	$	113,391
Securities available for sale		130,574
Other investments		16,092
Loans		482,168
Premises and equipment		12,644
Bank owned life insurance		21,547
Core deposit intangible		5,886
Current and deferred taxes		3,135
Other assets		7,805
Total assets acquired		793,242
Fair value of liabilities assumed
Deposits		695,274
Short-term borrowings		4,246
Long-term borrowings		4,262
Accrued interest payable and other liabilities		9,386
Total liabilities		713,168
Net assets acquired	$	80,074
Goodwill created		48,465
Total net assets acquired	$	128,539

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Securities (Tables)

3 Months Ended

Mar. 31, 2022

Investments Debt And Equity Securities [Abstract]

Summary of the Amortized Cost and Fair Value of Available-for-Sale Investment Securities Corresponding Amounts of Unrealized Gains and Losses

The following table summarizes the amortized cost and fair value of the available for sale investment securities portfolio at March 31, 2022 and December 31, 2021 and the corresponding amounts of unrealized gains and losses recognized in accumulated other comprehensive income:

			Gross		Gross
	Amortized		Unrealized		Unrealized
(In Thousands of Dollars)	Cost		Gains		Losses			Fair Value
March 31, 2022
U.S. Treasury and U.S. government sponsored entities	$	114,063	$	3	$	(9,119	)	$	104,947
State and political subdivisions		681,567		5,274		(41,233	)		645,608
Corporate bonds		4,399		4		(108	)		4,295
Mortgage-backed securities - residential		718,295		117		(54,717	)		663,695
Collateralized mortgage obligations - residential		41,039		21		(735	)		40,325
Small Business Administration		4,943		0		(187	)		4,756
Totals	$	1,564,306	$	5,419	$	(106,099	)	$	1,463,626

			Gross		Gross
	Amortized		Unrealized		Unrealized
(In Thousands of Dollars)	Cost		Gains		Losses			Fair Value
December 31, 2021
U.S. Treasury and U.S. government sponsored entities	$	93,137	$	32	$	(2,338	)	$	90,831
State and political subdivisions		636,724		23,296		(1,205	)		658,815
Corporate bonds		4,009		50		(29	)		4,030
Mortgage-backed securities - residential		663,405		1,875		(10,094	)		655,186
Collateralized mortgage obligations - residential		13,303		153		(71	)		13,385
Small Business Administration		5,381		49		0			5,430
Totals	$	1,415,959	$	25,455	$	(13,737	)	$	1,427,677

Amortized Cost and Fair Value of the Debt Securities Maturity

The amortized cost and fair value of the debt securities portfolio are shown in the table below by expected maturity.  Expected maturities may differ from contractual maturities if issuers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.

	March 31, 2022
(In Thousands of Dollars)	Amortized Cost		Fair Value
Maturity
Within one year	$	1,213	$	1,215
One to five years		14,507		14,683
Five to ten years		152,628		143,677
Beyond ten years		631,681		595,275
Mortgage-backed, collateralized mortgage obligations and Small Business Administration securities		764,277		708,776
Total	$	1,564,306	$	1,463,626

Available for Sale Investment Securities with Unrealized Losses

The following table summarizes the available for sale investment securities with unrealized losses at March 31, 2022 and December 31, 2021, aggregated by major security type and length of time in a continuous unrealized loss position.

	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands of Dollars)	Value		Loss			Value		Loss			Value		Loss
March 31, 2022
U.S. Treasury and U.S. government sponsored entities	$	94,866	$	(8,125	)	$	9,753	$	(994	)	$	104,619	$	(9,119	)
State and political subdivisions		420,523		(38,939	)		14,420		(2,294	)		434,943		(41,233	)
Corporate bonds		1,009		(38	)		670		(70	)		1,679		(108	)
Mortgage-backed securities - residential		511,033		(42,169	)		110,117		(12,548	)		621,150		(54,717	)
Collateralized mortgage obligations - residential		18,856		(735	)		0		0			18,856		(735	)
Small Business Administration		4,756		(187	)		0		0			4,756		(187	)
Total temporarily impaired	$	1,051,043	$	(90,193	)	$	134,960	$	(15,906	)	$	1,186,003	$	(106,099	)

	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands of Dollars)	Value		Loss			Value		Loss			Value		Loss
December 31, 2021
U.S. Treasury and U.S. government sponsored entities	$	81,236	$	(1,960	)	$	8,271	$	(378	)	$	89,507	$	(2,338	)
State and political subdivisions		103,651		(1,020	)		10,020		(185	)		113,671		(1,205	)
Corporate bonds		418		(2	)		715		(27	)		1,133		(29	)
Mortgage-backed securities - residential		525,792		(7,872	)		55,569		(2,222	)		581,361		(10,094	)
Collateralized mortgage obligations - residential		7,270		(71	)		0		0			7,270		(71	)
Total temporarily impaired	$	718,367	$	(10,925	)	$	74,575	$	(2,812	)	$	792,942	$	(13,737	)

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Loans (Tables)

3 Months Ended

Mar. 31, 2022

Receivables [Abstract]

Schedule of Loan Balances

Loan balances were as follows:

(In Thousands of Dollars)	March 31, 2022			December 31, 2021
Commercial real estate
Owner occupied	$	347,173		$	340,369
Non-owner occupied		540,194			533,240
Farmland		173,568			177,706
Other		113,605			138,282
Commercial
Commercial and industrial		298,903			313,836
Agricultural		51,277			54,659
Residential real estate
1-4 family residential		455,501			453,635
Home equity lines of credit		128,221			127,433
Consumer
Indirect		167,147			159,006
Direct		18,859			21,121
Other		6,580			9,395
Total originated loans	$	2,301,028		$	2,328,682
Net Deferred loan (fees) costs		3,943			2,400
Allowance for credit losses		(27,015	)		(29,386	)
Net loans	$	2,277,956		$	2,301,696

Activity in the Allowance for Loan Losses by Portfolio Segment

Allowance for credit loss activity

The following tables present the activity in the allowance for credit losses by portfolio segment for the three month period ended March 31, 2022 and 2021:

Three Months Ended March 31, 2022

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	15,879		$	4,949		$	4,870		$	3,688		$	29,386
Provision for credit losses		(672	)		271			(146	)		(383	)		(930	)
Loans charged off		0			(1,359	)		(34	)		(197	)		(1,590	)
Recoveries		0			6			12			131			149
Total ending allowance balance	$	15,207		$	3,867		$	4,702		$	3,239		$	27,015

Three Months Ended March 31, 2021

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	10,824		$	5,073		$	3,643		$	2,604		$	22,144
Impact of CECL adoption		(2,076	)		429			237			3,860			2,450
Provision for credit losses		96			(25	)		89			265			425
Loans charged off		0			(34	)		(67	)		(183	)		(284	)
Recoveries		0			7			59			134			200
Total ending allowance balance	$	8,844		$	5,450		$	3,961		$	6,680		$	24,935

Schedule of Investment in Nonaccrual and Loans Past Due 90 Days or More Still on Accrual by Class of Loans

The following table presents the recorded investment in nonaccrual and loans past due 90 days or more still on accrual by class of loans as of March 31, 2022 and December 31, 2021:

	March 31, 2022				December 31, 2021
(In Thousands of Dollars)	Nonaccrual		Loans Past Due 90 Days or More Still Accruing		Nonaccrual		Loans Past Due 90 Days or More Still Accruing
Commercial real estate
Owner occupied	$	416	$	0	$	433	$	0
Non-owner occupied		2,477		0		2,511		0
Farmland		271		0		274		0
Other		53		0		60		0
Commercial
Commercial and industrial		5,534		2		7,190		54
Agricultural		43		0		40		0
Residential real estate
1-4 family residential		2,940		671		3,363		459
Home equity lines of credit		928		0		917		36
Consumer
Indirect		456		52		455		123
Direct		180		23		227		53
Other		0		0		0		0
Total loans	$	13,298	$	748	$	15,470	$	725

Schedule of Investment in Past Due Loans

The following tables present the aging of the recorded investment in past due loans as of March 31, 2022 and December 31, 2021 by class of loans.  Note that loans on a modification to defer payments under the CARES Act are included in loans not past due for the period ending December 31, 2021.  There were no loans on deferred payments at March 31, 2022.

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
March 31, 2022
Commercial real estate
Owner occupied	$	68	$	0	$	416	$	484	$	346,298	$	346,782
Non-owner occupied		1		0		2,477		2,478		537,157		539,635
Farmland		0		0		271		271		173,000		173,271
Other		0		0		53		53		113,294		113,347
Commercial
Commercial and industrial		185		5		5,536		5,726		292,823		298,549
Agricultural		137		53		43		233		51,296		51,529
Residential real estate
1-4 family residential		5,583		71		3,611		9,265		445,497		454,762
Home equity lines of credit		138		23		928		1,089		127,154		128,243
Consumer
Indirect		479		268		508		1,255		172,096		173,351
Direct		242		50		203		495		18,427		18,922
Other		1		0		0		1		6,579		6,580
Total loans	$	6,834	$	470	$	14,046	$	21,350	$	2,283,621	$	2,304,971

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
December 31, 2021
Commercial real estate
Owner occupied	$	70	$	591	$	433	$	1,094	$	338,880	$	339,974
Non-owner occupied		394		311		2,511		3,216		529,490		532,706
Farmland		0		0		274		274		177,143		177,417
Other		56		0		60		116		137,878		137,994
Commercial
Commercial and industrial		256		100		7,244		7,600		304,932		312,532
Agricultural		100		28		40		168		54,706		54,874
Residential real estate
1-4 family residential		4,452		1,077		3,822		9,351		443,441		452,792
Home equity lines of credit		80		12		953		1,045		126,405		127,450
Consumer
Indirect		795		275		578		1,648		163,112		164,760
Direct		203		91		280		574		20,614		21,188
Other		0		0		0		0		9,395		9,395
Total loans	$	6,406	$	2,485	$	16,195	$	25,086	$	2,305,996	$	2,331,082

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Troubled Debt Restructurings (Tables)

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Schedule of Loans By Class Modified as Troubled Debt Restructurings

The following table presents loans by class modified as troubled debt restructurings that occurred during the three month period ended March 31, 2022 and 2021:

			Pre- Modification		Post- Modification
Three Months Ended March 31, 2022	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
1-4 family residential		1	$	50	$	52
Home equity lines of credit		1		14		14
Consumer
Indirect		1		14		14
Total loans		3	$	78	$	80

			Pre- Modification		Post- Modification
Three Months Ended March 31, 2021	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Commercial		4	$	22	$	22
Residential real estate
1-4 family residential		1		69		73
Home equity lines of credit		1		31		31
Consumer
Indirect		6		87		87
Total loans		12	$	209	$	213

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Credit Quality Indicators (Tables)

3 Months Ended

Mar. 31, 2022

Risks And Uncertainties [Abstract]

Risk Category of Loans by Class of Loans

As of March 31, 2022 and December 31, 2021, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

(In Thousands of Dollars)	Pass		Special Mention		Sub standard		Total
March 31, 2022
Commercial real estate
Owner occupied	$	338,256	$	4,430	$	4,096	$	346,782
Non-owner occupied		506,509		14,708		18,418		539,635
Farmland		170,456		2,145		670		173,271
Other		112,473		499		375		113,347
Commercial
Commercial and industrial		289,651		1,308		7,590		298,549
Agricultural		50,936		507		86		51,529
Total loans	$	1,468,281	$	23,597	$	31,235	$	1,523,113

(In Thousands of Dollars)	Pass		Special Mention		Sub standard		Total
December 31, 2021
Commercial real estate
Owner occupied	$	330,754	$	5,006	$	4,214	$	339,974
Non-owner occupied		495,170		19,366		18,170		532,706
Farmland		174,580		2,160		677		177,417
Other		137,063		784		147		137,994
Commercial
Commercial and industrial		301,879		1,190		9,463		312,532
Agricultural		54,394		397		83		54,874
Total loans	$	1,493,840	$	28,903	$	32,754	$	1,555,497

Investment in Residential, Consumer and Indirect Auto Loans Based on Payment Activity

The following tables present the recorded investment in residential, consumer indirect and direct auto loans based on payment activity as of March 31, 2022 and December 31, 2021.  Nonperforming loans are loans past due 90 days or more and still accruing interest and nonaccrual loans.

	Residential Real Estate				Consumer
(In Thousands of Dollars)	1-4 Family Residential		Home Equity Lines of Credit		Indirect		Direct		Other
March 31, 2022
Performing	$	451,151	$	127,315	$	172,843	$	18,719	$	6,580
Nonperforming		3,611		928		508		203		0
Total loans	$	454,762	$	128,243	$	173,351	$	18,922	$	6,580

	Residential Real Estate				Consumer
(In Thousands of Dollars)	1-4 Family Residential		Home Equity Lines of Credit		Indirect		Direct		Other
December 31, 2021
Performing	$	448,970	$	126,497	$	164,182	$	20,908	$	9,395
Nonperforming		3,822		953		578		280		6
Total loans	$	452,792	$	127,450	$	164,760	$	21,188	$	9,401

Risk Categories and Year of Origination

The following table presents total loans by risk categories and year of origination.

	Term Loans Amortized Cost Basis by Origination Year
As of March 31, 2022	2022		2021		2020		2019		2018		Prior		Revolving Loans		Total
Commercial real estate
Risk Rating
Pass	$	34,484	$	170,585	$	141,201	$	163,632	$	114,598	$	314,075	$	18,663	$	957,238
Special mention		0		788		0		6,924		2,020		9,387		518		19,637
Substandard		40		0		661		2,648		492		18,441		607		22,889
Total commercial real estate loans	$	34,524	$	171,373	$	141,862	$	173,204	$	117,110	$	341,903	$	19,788	$	999,764
Commercial
Risk Rating
Pass	$	28,559	$	80,860	$	46,807	$	25,005	$	20,084	$	24,321	$	64,015	$	289,651
Special mention		0		533		103		122		31		2		517		1,308
Substandard		399		1,984		1,676		265		257		1,890		1,119		7,590
Total commercial loans	$	28,958	$	83,377	$	48,586	$	25,392	$	20,372	$	26,213	$	65,651	$	298,549
Agricultural
Risk Rating
Pass	$	9,435	$	42,324	$	49,368	$	27,039	$	27,002	$	51,111	$	15,113	$	221,392
Special mention		0		0		227		31		0		2,045		349		2,652
Substandard		0		365		17		58		11		275		30		756
Total agricultural loans	$	9,435	$	42,689	$	49,612	$	27,128	$	27,013	$	53,431	$	15,492	$	224,800
Residential real estate
Risk Rating
Pass	$	19,699	$	102,254	$	86,118	$	36,861	$	29,617	$	167,930	$	3,706	$	446,185
Special mention		0		0		73		127		80		139		0		419
Substandard		0		46		100		89		30		7,893		0		8,158
Total residential real estate loans	$	19,699	$	102,300	$	86,291	$	37,077	$	29,727	$	175,962	$	3,706	$	454,762
Home equity lines of credit
Risk Rating
Pass	$	0	$	0	$	149	$	0	$	19	$	1,744	$	124,320	$	126,232
Special mention		0		0		0		0		0		0		48		48
Substandard		0		13		12		51		143		1,626		118		1,963
Total home equity lines of credit	$	0	$	13	$	161	$	51	$	162	$	3,370	$	124,486	$	128,243
Consumer
Risk Rating
Pass	$	24,827	$	58,540	$	42,425	$	30,910	$	18,087	$	17,561	$	5,408	$	197,758
Substandard		0		120		261		253		102		359		0		1,095
Total consumer loans	$	24,827	$	58,660	$	42,686	$	31,163	$	18,189	$	17,920	$	5,408	$	198,853

Schedule of Outstanding Balance and Related Allowance on Loans

The outstanding balance at March 31, 2022 and related allowance on these loans is as follows:

	Loan Balance		ACL Balance
Commercial real estate
Owner Occupied	$	2,531	$	82
Non-owner Occupied		20,017		890
Other		780		36
		23,328		1,008
Commercial
Commercial and industrial		1,775		106
Residential real estate
1-4 family residential		500		4
Total	$	25,603	$	1,118

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Revenue from Contracts with Customers (Tables)

3 Months Ended

Mar. 31, 2022

Revenue From Contract With Customer [Abstract]

Summary of Noninterest Income by Revenue Stream and Reportable Segment, Net of Eliminations

All material revenue from contracts with customers in the scope of ASC 606 is recognized within noninterest income.  The following table presents the Company’s noninterest income by revenue stream and reportable segment, net of eliminations, for the three months ended March 31, 2022 and 2021.

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Three Months Ended March 31, 2022
Service charges on deposit accounts	$	0	$	1,145	$	1,145
Debit card and EFT fees		0		1,416		1,416
Trust fees		2,519		0		2,519
Insurance agency commissions		0		1,047		1,047
Retirement plan consulting fees		397		0		397
Investment commissions		0		694		694
Other (outside the scope of ASC 606)		0		10,480		10,480
Total noninterest income	$	2,916	$	14,782	$	17,698

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Three Months Ended March 31, 2021
Service charges on deposit accounts	$	0	$	808	$	808
Debit card and EFT fees		0		1,171		1,171
Trust fees		2,236		0		2,236
Insurance agency commissions		0		1,003		1,003
Retirement plan consulting fees		320		0		320
Investment commissions		0		504		504
Other (outside the scope of ASC 606)		0		4,090		4,090
Total noninterest income	$	2,556	$	7,576	$	10,132

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Fair Value (Tables)

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Assets Measured at Fair Value on Recurring Basis

Assets measured at fair value on a recurring basis are summarized below:

			Fair Value Measurements at March 31, 2022 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investment securities available-for sale
U.S. Treasury and U.S. government sponsored entities	$	104,947	$	0	$	104,947	$	0
State and political subdivisions		645,608		0		645,608		0
Corporate bonds		4,295		0		4,295		0
Mortgage-backed securities-residential		663,695		0		663,693		2
Collateralized mortgage obligations		40,325		0		40,325		0
Small Business Administration		4,756		0		4,756		0
Equity securities
Equity securities at fair value		217		217		0		0
Other investments measured at net asset value		14,723	n/a		n/a		n/a
Total investment securities	$	1,478,566	$	217	$	1,463,624	$	2
Interest rate swaps	$	2,232	$	0	$	2,232	$	0
Financial Liabilities
Interest rate swaps	$	2,232	$	0	$	2,232	$	0

			Fair Value Measurements at December 31, 2021 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices  in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investment securities available-for sale
U.S. Treasury and U.S. government sponsored entities	$	90,831	$	0	$	90,831	$	0
State and political subdivisions		658,815		0		658,815		0
Corporate bonds		4,030		0		4,030		0
Mortgage-backed securities-residential		655,186		0		655,183		3
Collateralized mortgage obligations		13,385		0		13,385		0
Small Business Administration		5,430		0		5,430		0
Equity securities
Equity securities at fair value		228		228		0		0
Other investments measured at net asset value		14,721	n/a		n/a		n/a
Total investment securities	$	1,442,626	$	228	$	1,427,674	$	3
Interest rate swaps	$	4,261	$	0	$	4,261	$	0
Financial Liabilities
Interest rate swaps	$	4,261	$	0	$	4,261	$	0

Reconciliation of All Assets Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3):

	Investment Securities Available-for-sale (Level 3)
	Three Months ended March 31,
(In Thousands of Dollars)	2022			2021
Beginning Balance	$	3		$	4
Transfers from level 2		0			0
Repayments, calls and maturities		(1	)		0
Ending Balance	$	2		$	4

Assets Measured at Fair Value on Non-Recurring Basis

Assets measured at fair value on a non-recurring basis are summarized below:

			Fair Value Measurements at March 31, 2022 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices  in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Individually evaluated loans
1–4 family residential	$	82	$	0	$	0	$	82
Consumer indirect		14		0		0		14

			Fair Value Measurements at December 31, 2021 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Individually Evaluated loans
Commercial	$	1,654	$	0	$	0	$	1,654
1–4 family residential		82		0		0		82

Fair Value Measurements for Financial Instruments

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at the periods ended March 31, 2022 and December 31, 2021:

March 31, 2022	Fair value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individually evaluated loans
Residential		82	Sales comparison	Adjustment for differences between comparable sales	(3.84%) - 3.22% (0.12%)
Consumer indirect		14	Sales comparison	Adjustment for differences between comparable sales	(6.08%) - 6.08% 0.00%

December 31, 2021	Fair value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individually evaluated loans
Commercial	$	1,654	Sales comparison	Adjustment for differences between comparable sales	(40.24%) - 56.83% (12.43%)
Residential		82	Sales comparison	Adjustment for differences between comparable sales	(3.84%) - 3.22% (0.12%)

Carrying Amounts and Estimated Fair Values of Financial Instruments

The carrying amounts and estimated fair values of financial instruments not previously disclosed at March 31, 2022 and December 31, 2021 are as follows:

			Fair Value Measurements at March 31, 2022 Using:
(In Thousands of Dollars)	Carrying Amount		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	137,627	$	29,224	$	108,403	$	0	$	137,627
Regulatory stock		19,080	n/a		n/a		n/a		n/a
Loans held for sale		1,904		0		1,942		0		1,942
Loans, net		2,277,956		0		0		2,254,714		2,254,714
Financial liabilities
Deposits		3,693,811		3,283,963		397,903		0		3,681,866
Long-term borrowings		87,872		0		84,946		0		84,946

			Fair Value Measurements at December 31, 2021 Using:
(In Thousands of Dollars)	Carrying Amount		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	112,790	$	29,150	$	83,640	$	0	$	112,790
Regulatory stock		15,510	n/a		n/a		n/a		n/a
Loans held for sale		4,545		0		4,681		0		4,681
Loans, net		2,301,696		0		0		2,285,554		2,285,554
Financial liabilities
Deposits		3,547,235		3,158,967		384,263		0		3,543,230
Long-term borrowings		87,758		0		92,433		0		92,433

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Goodwill and Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2022

Goodwill And Intangible Assets Disclosure [Abstract]

Acquired Intangible Assets

Acquired intangible assets were as follows:

	March 31, 2022					December 31, 2021
(In Thousands of Dollars)	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Amortized intangible assets:
Customer relationship intangibles	$	7,210	$	(6,679	)	$	7,210	$	(6,641	)
Non-compete contracts		430		(393	)		430		(392	)
Trade name		520		(364	)		520		(356	)
Core deposit intangible		12,866		(5,643	)		12,866		(5,271	)
Total	$	21,026	$	(13,079	)	$	21,026	$	(12,660	)

Estimated Amortization Expense

Estimated amortization expense for each of the next five periods and thereafter:

2022 (9 months)	$	1,251
2023		1,198
2024		894
2025		833
2026		741
Thereafter		3,030
Total	$	7,947

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Leases (Tables)

3 Months Ended

Mar. 31, 2022

Leases [Abstract]

Maturities of Lease Liabilities

Maturities of lease liabilities are as follows as of March 31, 2022:

2022 (9 months)	$	596
2023		780
2024		610
2025		603
2026		586
Thereafter		4,245
Total Payments		7,420
Less: Imputed Interest		(1,035	)
Total	$	6,385

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Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

Computation of Basic and Diluted Earnings Per Share

The computation of basic and diluted earnings per share is shown in the following table:

	Three Months Ended March 31,
	2022		2021
Basic EPS
Net income (In thousands)	$	15,844	$	14,556
Weighted average shares outstanding		33,820,485		28,215,772
Basic earnings per share	$	0.47	$	0.52
Diluted EPS
Net income (In thousands)	$	15,844	$	14,556
Weighted average shares outstanding for basic earnings per share		33,820,485		28,215,772
Dilutive effect of restricted stock awards		116,453		120,367
Weighted average shares for diluted earnings per share		33,936,938		28,336,139
Diluted earnings per share	$	0.47	$	0.51

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Stock Based Compensation (Tables)

3 Months Ended

Mar. 31, 2022

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Summary of Award Activity under Plans

The following is the activity under the Plans during the three month period ended March 31, 2022.

	Maximum Awarded Service Units			Weighted Average Grant Date Fair Value		Maximum Awarded Performance Units			Weighted Average Grant Date Fair Value
Beginning balance - non-vested shares		99,564		$	16.13		158,988		$	14.40
Granted		75,768			17.69		56,724			17.25
Vested		(15,771	)		17.29		(65,481	)		17.48
Forfeited		0			0.00		(12,862	)		14.74
Ending balance - non-vested shares		159,561		$	17.13		137,369		$	15.85

The following is the activity under the Plans during the three month period ended March 31, 2021.

	Maximum Awarded Service Units			Weighted Average Grant Date Fair Value		Maximum Awarded Performance Units			Weighted Average Grant Date Fair Value
Beginning balance - non-vested shares		67,765		$	14.32		153,070		$	14.46
Granted		19,062			14.36		52,249			14.09
Vested		(13,081	)		14.34		(52,327	)		14.34
Forfeited		(2,000	)		13.55		0			0
Ending balance - non-vested shares		71,746		$	14.35		152,992		$	14.37

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Other Comprehensive Income (Loss) (Tables)

3 Months Ended

Mar. 31, 2022

Comprehensive Income Net Of Tax [Abstract]

Schedule of Other Comprehensive Income (Loss)

The following tables represent the details of other comprehensive income for the three month periods ended March 31, 2022 and 2021.

	Three Months Ended March 31, 2022
(In Thousands of Dollars)	Pre-tax			Tax		After-Tax
Unrealized holding losses on available-for-sale securities during the period	$	(112,398	)	$	23,605	$	(88,793	)
Reclassification adjustment for gains included in net income (1)		0			0		0
Net unrealized losses on available-for-sale securities	$	(112,398	)	$	23,605	$	(88,793	)
Change in funded status of post-retirement health plan		(2	)		0		(2	)
Net other comprehensive loss	$	(112,400	)	$	23,605	$	(88,795	)
	Three Months Ended March 31, 2021
(In Thousands of Dollars)	Pre-tax			Tax		After-Tax
Unrealized holding losses on available-for-sale securities during the period	$	(14,934	)	$	3,136	$	(11,798	)
Reclassification adjustment for gains included in net income (1)		(383	)		81		(302	)
Net other comprehensive loss	$	(15,317	)	$	3,217	$	(12,100	)

(1) Pre-tax reclassification adjustments relating to available-for-sale securities are reported in security gains and the tax impact is included in income tax expense on the consolidated statements of income.

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Regulatory Capital Matters (Tables)

3 Months Ended

Mar. 31, 2022

Regulatory Capital Requirements [Abstract]

Schedule of Actual and Required Capital Amounts and Ratios, Not Include Capital Conservation Buffer

Actual and required capital amounts and ratios, which do not include the capital conservation buffer, are presented below at March 31, 2022 and December 31, 2021:

	Actual					Requirement For Capital Adequacy Purposes:					To be Well Capitalized Under Prompt Corrective Action Provisions:
	Amount		Ratio			Amount		Ratio			Amount		Ratio
March 31, 2022
Common equity tier 1 capital ratio
Consolidated	$	373,543		13.31	%	$	126,292		4.5	%	N/A		N/A
Bank		355,986		12.75	%		125,692		4.5	%		181,555		6.5	%
Total risk based capital ratio
Consolidated		493,558		17.59	%		224,519		8.0	%	N/A		N/A
Bank		383,001		13.71	%		223,452		8.0	%		279,315		10.0	%
Tier 1 risk based capital ratio
Consolidated		391,543		13.95	%		168,389		6.0	%	N/A		N/A
Bank		355,986		12.75	%		167,589		6.0	%		223,452		8.0	%
Tier 1 leverage ratio
Consolidated		391,543		9.56	%		163,860		4.0	%	N/A		N/A
Bank		355,986		8.72	%		163,207		4.0	%		204,009		5.0	%
December 31, 2021
Common equity tier 1 capital ratio
Consolidated	$	362,950		13.16	%	$	124,066		4.5	%	N/A		N/A
Bank		345,065		12.55	%		123,712		4.5	%	$	178,695		6.5	%
Total risk based capital ratio
Consolidated		485,336		17.60	%		220,562		8.0	%	N/A		N/A
Bank		374,451		13.62	%		219,933		8.0	%		274,916		10.0	%
Tier 1 risk based capital ratio
Consolidated		380,950		13.82	%		165,422		6.0	%	N/A		N/A
Bank		345,065		12.55	%		164,950		6.0	%		219,933		8.0	%
Tier 1 leverage ratio
Consolidated		380,950		10.12	%		150,629		4.0	%	N/A		N/A
Bank		345,065		9.19	%		150,217		4.0	%		187,772		5.0	%

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Segment Information (Tables)

3 Months Ended

Mar. 31, 2022

Segment Reporting [Abstract]

Schedule of Segment Reporting Information

Significant segment totals are reconciled to the financial statements as follows:

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
March 31, 2022
Goodwill and other intangibles	$	5,796	$	100,654	$	(4,263	)	$	102,187
Total assets	$	19,548	$	4,182,798	$	3,509		$	4,205,855

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
December 31, 2021
Goodwill and other intangibles	$	5,814	$	101,055	$	(4,263	)	$	102,606
Total assets	$	14,365	$	4,124,530	$	3,854		$	4,142,749

(In Thousands of Dollars)	Trust Segment		Bank Segment			Eliminations and Others			Consolidated Totals
For Three Months Ended March 31, 2022
Net interest income	$	34	$	31,993		$	(785	)	$	31,242
Provision for credit losses and unfunded loans		0		(358	)		0			(358	)
Service fees, security gains and other noninterest income		9,198		8,741			(241	)		17,698
Noninterest expense		1,769		27,442			83			29,294
Amortization and depreciation expense		28		1,134			0			1,162
Income before taxes		7,435		12,516			(1,109	)		18,842
Income taxes		1,562		1,734			(298	)		2,998
Net income	$	5,873	$	10,782		$	(811	)	$	15,844

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
For Three Months Ended March 31, 2021
Net interest income	$	31	$	25,290	$	(54	)	$	25,267
Provision for credit losses and unfunded loans		0		425		0			425
Service fees, security gains and other noninterest income		2,603		7,514		15			10,132
Noninterest expense		1,556		15,181		(218	)		16,519
Amortization and depreciation expense		64		666		68			798
Income before taxes		1,014		16,532		111			17,657
Income taxes		212		2,947		(58	)		3,101
Net income	$	802	$	13,585	$	169		$	14,556

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Long-Term Borrowings (Tables)

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Summary of All Junior Subordinated Debentures and Subordinated Debentures

A summary of all junior subordinated debentures issued by the Company to affiliates and subordinated debentures follows.  For the junior subordinated debentures, these amounts represent the par value of the obligations owed to these affiliates, including the Company’s equity interest in the trusts along with any unamortized fair value marks.  For the subordinated debentures, these amounts represent the par value less the remaining deferred offering expense associated with the issuance of the debentures.  

	March 31, 2022	December 31, 2021
	Amount	Amount
TSEO Statutory Trust I	$2,436	$2,424
Maple Leaf Financial Statutory Trust II	7,349	7,293
Cortland Statutory Trust I	4,285	4,271
Total junior subordinated debentures owed to unconsolidated subsidiary trusts	$14,070	$13,988
Subordinated debentures	$73,802	$73,770

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Summary of Significant Accounting Policies (Details Textual)	3 Months Ended
	Mar. 31, 2022 Segment shares	Dec. 31, 2021 shares
Summary of Significant Accounting Policies (Additional Textual) [Abstract]
Operating segments of business | Segment	2
Common stock, shares authorized and available for issuance	50,000,000	50,000,000
Common stock, shares outstanding	34,007,677	33,898,237

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Business Combinations (Details Textual) $ / shares in Units, $ in Thousands				3 Months Ended	12 Months Ended
	Mar. 23, 2022 Branch	Nov. 01, 2021 USD ($) $ / shares shares	Oct. 31, 2021 USD ($) $ / shares shares	Mar. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)	Mar. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Business Acquisition [Line Items]
Total assets				$ 4,205,855	$ 4,142,749
Deposits				3,693,811	3,547,235
Equity				393,886	472,432	$ 347,355	$ 350,097
Goodwill				94,240	94,240
Common Stock
Business Acquisition [Line Items]
Equity				304,670	306,123	$ 208,199	$ 208,763
Emclaire Financial
Business Acquisition [Line Items]
Business acquisition, date of merger agreement	Mar. 23, 2022
Number of operating branches | Branch	19
Total assets				1,100,000
Gross loans				794,900
Deposits				936,000
Equity				86,700
Cortland Bank
Business Acquisition [Line Items]
Business acquisition, date of merger agreement		Nov. 01, 2021
Cash consideration per share | $ / shares | $ / shares			$ 17.82
Maximum percentage of common shares exchanged for company's shares under merger agreement		75.00%
Percentage of common shares exchanged for company's cash under merger agreement		25.00%
Value of stock issued for acquisition		$ 29,618
Fair value of total consideration transferred		128,539	$ 128,500
Merger related costs				$ 1,900	$ 7,100
Goodwill		$ 48,465
Cortland Bank | Common Stock
Business Acquisition [Line Items]
Cash consideration per share | $ / shares | $ / shares		$ 28.00
Shares of stock issued for acquisition | shares		1.75	5,600,000
Value of stock issued for acquisition			$ 29,600

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Business Combinations (Details) - USD ($) $ in Thousands	Nov. 01, 2021	Oct. 31, 2021	Mar. 31, 2022	Dec. 31, 2021
Fair value of liabilities assumed
Goodwill created			$ 94,240	$ 94,240
Cortland Bank
Consideration
Cash	$ 29,618
Stock	98,921
Fair value of total consideration transferred	128,539	$ 128,500
Fair value of assets acquired
Cash and cash equivalents	113,391
Securities available for sale	130,574
Other investments	16,092
Loans	482,168
Premises and equipment	12,644
Bank owned life insurance	21,547
Core deposit intangible	5,886
Current and deferred taxes	3,135
Other assets	7,805
Total assets acquired	793,242
Fair value of liabilities assumed
Deposits	695,274
Short-term borrowings	4,246
Long-term borrowings	4,262
Accrued interest payable and other liabilities	9,386
Total liabilities	713,168
Net assets acquired	80,074
Goodwill created	48,465
Total net assets acquired	$ 128,539

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Securities (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	$ 1,564,306	$ 1,415,959
Gross Unrealized Gains	5,419	25,455
Gross Unrealized Losses	(106,099)	(13,737)
Fair Value	1,463,626	1,427,677
U.S. Treasury and U.S. government sponsored entities
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	114,063	93,137
Gross Unrealized Gains	3	32
Gross Unrealized Losses	(9,119)	(2,338)
Fair Value	104,947	90,831
State and political subdivisions
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	681,567	636,724
Gross Unrealized Gains	5,274	23,296
Gross Unrealized Losses	(41,233)	(1,205)
Fair Value	645,608	658,815
Mortgage-backed securities - residential
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	718,295	663,405
Gross Unrealized Gains	117	1,875
Gross Unrealized Losses	(54,717)	(10,094)
Fair Value	663,695	655,186
Collateralized mortgage obligations - residential
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	41,039	13,303
Gross Unrealized Gains	21	153
Gross Unrealized Losses	(735)	(71)
Fair Value	40,325	13,385
Corporate bonds
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	4,399	4,009
Gross Unrealized Gains	4	50
Gross Unrealized Losses	(108)	(29)
Fair Value	4,295	4,030
Small Business Administration
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	4,943	5,381
Gross Unrealized Gains	0	49
Gross Unrealized Losses	(187)	0
Fair Value	$ 4,756	$ 5,430

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Securities (Details Textual)	3 Months Ended
	Mar. 31, 2022 USD ($) Securities	Mar. 31, 2021 USD ($)
Schedule Of Available For Sale Securities [Line Items]
Proceeds from the sale of portfolio securities	$ 0	$ 26,200,000
Gross gains realized		406,000
Gross losses realized		23,000
Number of securities | Securities	879
Number of securities on unrealized loss position | Securities	595
Allowance for credit losses on available-for-sale securities	$ 0
ASU 2016-01 | Equity securities
Schedule Of Available For Sale Securities [Line Items]
Realized gains recognized in income statement for securities		$ 105,000
Realized loss recognized in income statement for securities	$ 11,000

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Securities (Details 1) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Amortized cost and fair value of the debt securities maturity
Amortized Cost, Within one year	$ 1,213
Amortized Cost, One to five years	14,507
Amortized Cost, Five to ten years	152,628
Amortized Cost, Beyond ten years	631,681
Amortized Cost, Mortgage-backed, collateralized mortgage obligations and Small Business Administration securities	764,277
Amortized Cost	1,564,306	$ 1,415,959
Fair Value, Within one year	1,215
Fair Value, One to five years	14,683
Fair Value, Five to ten years	143,677
Fair Value, Beyond ten years	595,275
Fair Value, Mortgage-backed, collateralized mortgage obligations and Small Business Administration securities	708,776
Fair Value, Total	$ 1,463,626	$ 1,427,677

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Securities (Details 2) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	$ 1,051,043	$ 718,367
Unrealized Losses, Less Than 12 Months	(90,193)	(10,925)
Fair Value, 12 Months or Longer	134,960	74,575
Unrealized Losses, 12 Months or Longer	(15,906)	(2,812)
Fair Value, Total	1,186,003	792,942
Unrealized Losses, Total	(106,099)	(13,737)
U.S. Treasury and U.S. government sponsored entities
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	94,866	81,236
Unrealized Losses, Less Than 12 Months	(8,125)	(1,960)
Fair Value, 12 Months or Longer	9,753	8,271
Unrealized Losses, 12 Months or Longer	(994)	(378)
Fair Value, Total	104,619	89,507
Unrealized Losses, Total	(9,119)	(2,338)
State and political subdivisions
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	420,523	103,651
Unrealized Losses, Less Than 12 Months	(38,939)	(1,020)
Fair Value, 12 Months or Longer	14,420	10,020
Unrealized Losses, 12 Months or Longer	(2,294)	(185)
Fair Value, Total	434,943	113,671
Unrealized Losses, Total	(41,233)	(1,205)
Mortgage-backed securities - residential
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	511,033	525,792
Unrealized Losses, Less Than 12 Months	(42,169)	(7,872)
Fair Value, 12 Months or Longer	110,117	55,569
Unrealized Losses, 12 Months or Longer	(12,548)	(2,222)
Fair Value, Total	621,150	581,361
Unrealized Losses, Total	(54,717)	(10,094)
Collateralized mortgage obligations - residential
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	18,856	7,270
Unrealized Losses, Less Than 12 Months	(735)	(71)
Fair Value, 12 Months or Longer	0	0
Unrealized Losses, 12 Months or Longer	0	0
Fair Value, Total	18,856	7,270
Unrealized Losses, Total	(735)	(71)
Corporate bonds
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	1,009	418
Unrealized Losses, Less Than 12 Months	(38)	(2)
Fair Value, 12 Months or Longer	670	715
Unrealized Losses, 12 Months or Longer	(70)	(27)
Fair Value, Total	1,679	1,133
Unrealized Losses, Total	(108)	$ (29)
Small Business Administration
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	4,756
Unrealized Losses, Less Than 12 Months	(187)
Fair Value, 12 Months or Longer	0
Unrealized Losses, 12 Months or Longer	0
Fair Value, Total	4,756
Unrealized Losses, Total	$ (187)

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Loans (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
Schedule of loan balances
Total loans	$ 2,277,956	$ 2,301,696
Net Deferred loan (fees) costs	3,943	2,400
Allowance for credit losses	(27,015)	(29,386)	$ (24,935)	$ (22,144)
Commercial real estate
Schedule of loan balances
Allowance for credit losses	(15,207)	(15,879)	(8,844)	(10,824)
Commercial
Schedule of loan balances
Allowance for credit losses	(3,867)	(4,949)	(5,450)	(5,073)
Residential real estate
Schedule of loan balances
Allowance for credit losses	(4,702)	(4,870)	(3,961)	(3,643)
Consumer
Schedule of loan balances
Allowance for credit losses	(3,239)	(3,688)	$ (6,680)	$ (2,604)
Originated Loans
Schedule of loan balances
Total loans	2,301,028	2,328,682
Originated Loans | Commercial real estate, Owner occupied | Commercial real estate
Schedule of loan balances
Loan balances	347,173	340,369
Originated Loans | Commercial real estate, Non-owner occupied | Commercial real estate
Schedule of loan balances
Loan balances	540,194	533,240
Originated Loans | Commercial real estate, Farmland | Commercial real estate
Schedule of loan balances
Loan balances	173,568	177,706
Originated Loans | Commercial real estate, Other | Commercial real estate
Schedule of loan balances
Loan balances	113,605	138,282
Originated Loans | Commercial, Commercial and industrial | Commercial
Schedule of loan balances
Loan balances	298,903	313,836
Originated Loans | Commercial, Agricultural | Commercial
Schedule of loan balances
Loan balances	51,277	54,659
Originated Loans | Residential real estate, 1-4 family residential | Residential real estate
Schedule of loan balances
Loan balances	455,501	453,635
Originated Loans | Residential real estate, Home equity lines of credit | Residential real estate
Schedule of loan balances
Loan balances	128,221	127,433
Originated Loans | Consumer, Indirect | Consumer
Schedule of loan balances
Loan balances	167,147	159,006
Originated Loans | Consumer, Direct | Consumer
Schedule of loan balances
Loan balances	18,859	21,121
Originated Loans | Consumer, Other | Consumer
Schedule of loan balances
Loan balances	$ 6,580	$ 9,395

XML

Loans (Details 1) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Financing Receivable Allowance For Credit Losses [Line Items]
Beginning balance	$ 29,386	$ 22,144
Impact of CECL adoption		2,450
Provision for credit losses	(930)	425
Loans charged off	(1,590)	(284)
Recoveries	149	200
Ending balance	27,015	24,935
Commercial real estate
Financing Receivable Allowance For Credit Losses [Line Items]
Beginning balance	15,879	10,824
Impact of CECL adoption		(2,076)
Provision for credit losses	(672)	96
Loans charged off	0	0
Recoveries	0	0
Ending balance	15,207	8,844
Commercial
Financing Receivable Allowance For Credit Losses [Line Items]
Beginning balance	4,949	5,073
Impact of CECL adoption		429
Provision for credit losses	271	(25)
Loans charged off	(1,359)	(34)
Recoveries	6	7
Ending balance	3,867	5,450
Residential real estate
Financing Receivable Allowance For Credit Losses [Line Items]
Beginning balance	4,870	3,643
Impact of CECL adoption		237
Provision for credit losses	(146)	89
Loans charged off	(34)	(67)
Recoveries	12	59
Ending balance	4,702	3,961
Consumer
Financing Receivable Allowance For Credit Losses [Line Items]
Beginning balance	3,688	2,604
Impact of CECL adoption		3,860
Provision for credit losses	(383)	265
Loans charged off	(197)	(183)
Recoveries	131	134
Ending balance	$ 3,239	$ 6,680

XML

Loans (Details 2) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	$ 13,298	$ 15,470
Loans Past Due 90 Days or More Still Accruing	748	725
Originated Loans | Commercial real estate, Owner occupied | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	416	433
Loans Past Due 90 Days or More Still Accruing	0	0
Originated Loans | Commercial real estate, Non-owner occupied | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	2,477	2,511
Loans Past Due 90 Days or More Still Accruing	0	0
Originated Loans | Commercial real estate, Other | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	53	60
Loans Past Due 90 Days or More Still Accruing	0	0
Originated Loans | Commercial real estate, Farmland | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	271	274
Loans Past Due 90 Days or More Still Accruing	0	0
Originated Loans | Commercial, Commercial and industrial | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	5,534	7,190
Loans Past Due 90 Days or More Still Accruing	2	54
Originated Loans | Commercial, Agricultural | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	43	40
Loans Past Due 90 Days or More Still Accruing	0	0
Originated Loans | Residential real estate, 1-4 family residential | Residential real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	2,940	3,363
Loans Past Due 90 Days or More Still Accruing	671	459
Originated Loans | Residential real estate, Home equity lines of credit | Residential real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	928	917
Loans Past Due 90 Days or More Still Accruing	0	36
Originated Loans | Consumer, Indirect | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	456	455
Loans Past Due 90 Days or More Still Accruing	52	123
Originated Loans | Consumer, Direct | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	180	227
Loans Past Due 90 Days or More Still Accruing	23	53
Originated Loans | Consumer, Other | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	0	0
Loans Past Due 90 Days or More Still Accruing	$ 0	$ 0

XML

Loans (Details Textual)	3 Months Ended
	Mar. 31, 2022 USD ($)
Receivables [Abstract]
Deferred loan payments	$ 0

XML

Loans (Details 3) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	$ 2,304,971	$ 2,331,082
Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	6,834	6,406
Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	470	2,485
Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	14,046	16,195
Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	21,350	25,086
Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	2,283,621	2,305,996
Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	999,764
Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	298,549
Residential real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	454,762
Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	198,853
Commercial real estate, Owner occupied | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	346,782	339,974
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	68	70
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0	591
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	416	433
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	484	1,094
Commercial real estate, Owner occupied | Commercial real estate | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	346,298	338,880
Commercial real estate, Non-owner occupied | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	539,635	532,706
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	1	394
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0	311
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	2,477	2,511
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	2,478	3,216
Commercial real estate, Non-owner occupied | Commercial real estate | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	537,157	529,490
Commercial real estate, Farmland | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	173,271	177,417
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0	0
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0	0
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	271	274
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	271	274
Commercial real estate, Farmland | Commercial real estate | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	173,000	177,143
Commercial real estate, Other | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	113,347	137,994
Commercial real estate, Other | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0	56
Commercial real estate, Other | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0	0
Commercial real estate, Other | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	53	60
Commercial real estate, Other | Commercial real estate | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	53	116
Commercial real estate, Other | Commercial real estate | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	113,294	137,878
Commercial, Commercial and industrial | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	298,549	312,532
Commercial, Commercial and industrial | Commercial | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	185	256
Commercial, Commercial and industrial | Commercial | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	5	100
Commercial, Commercial and industrial | Commercial | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	5,536	7,244
Commercial, Commercial and industrial | Commercial | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	5,726	7,600
Commercial, Commercial and industrial | Commercial | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	292,823	304,932
Commercial, Agricultural | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	51,529	54,874
Commercial, Agricultural | Commercial | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	137	100
Commercial, Agricultural | Commercial | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	53	28
Commercial, Agricultural | Commercial | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	43	40
Commercial, Agricultural | Commercial | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	233	168
Commercial, Agricultural | Commercial | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	51,296	54,706
Residential real estate, 1-4 family residential | Residential real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	454,762	452,792
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	5,583	4,452
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	71	1,077
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	3,611	3,822
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	9,265	9,351
Residential real estate, 1-4 family residential | Residential real estate | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	445,497	443,441
Residential real estate, Home equity lines of credit | Residential real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	128,243	127,450
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	138	80
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	23	12
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	928	953
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	1,089	1,045
Residential real estate, Home equity lines of credit | Residential real estate | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	127,154	126,405
Consumer, Indirect | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	173,351	164,760
Consumer, Indirect | Consumer | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	479	795
Consumer, Indirect | Consumer | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	268	275
Consumer, Indirect | Consumer | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	508	578
Consumer, Indirect | Consumer | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	1,255	1,648
Consumer, Indirect | Consumer | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	172,096	163,112
Consumer, Direct | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	18,922	21,188
Consumer, Direct | Consumer | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	242	203
Consumer, Direct | Consumer | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	50	91
Consumer, Direct | Consumer | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	203	280
Consumer, Direct | Consumer | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	495	574
Consumer, Direct | Consumer | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	18,427	20,614
Consumer, Other | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	6,580	9,395
Consumer, Other | Consumer | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	1	0
Consumer, Other | Consumer | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0	0
Consumer, Other | Consumer | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0	0
Consumer, Other | Consumer | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	1	0
Consumer, Other | Consumer | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	$ 6,579	$ 9,395

XML

Troubled Debt Restructurings (Details Textual)	3 Months Ended
	Mar. 31, 2022 USD ($) Loans Customer	Mar. 31, 2021 USD ($) Loans	Dec. 31, 2021 USD ($)
Financing Receivable Modifications [Line Items]
Total troubled debt restructurings	$ 3,800,000		$ 3,900,000
Commitments to lend additional amounts to borrowers classified as troubled debt restructurings	0		0
Provision for credit losses	(930,000)	$ 425,000
Small Business Administration (SBA), CARES Act, Paycheck Protection Program
Financing Receivable Modifications [Line Items]
Total troubled debt restructurings	$ 256,400,000
Number of business customers facilitated assistance | Customer	2,134
Payments received from forgiveness of loans		107,900,000
Small Business Administration (SBA), CARES Act, Paycheck Protection Program | PPP Loan Originated In 2020
Financing Receivable Modifications [Line Items]
Payments received from forgiveness of loans	$ 256,300,000
Percentage of payments received from forgiveness of loans	99.98%
Small Business Administration (SBA), CARES Act, Paycheck Protection Program | PPP Loan Originated In 2021
Financing Receivable Modifications [Line Items]
Payments received from forgiveness of loans		$ 84,900,000
Percentage of payments received from forgiveness of loans		78.70%
Payment Deferral
Financing Receivable Modifications [Line Items]
Number of months offered, deferrals	3 months
Payment Deferral | Minimum
Financing Receivable Modifications [Line Items]
Number of months offered, deferrals	3 months
Payment Deferral | Maximum
Financing Receivable Modifications [Line Items]
Number of months offered, deferrals	12 months
Residential Mortgage
Financing Receivable Modifications [Line Items]
Troubled debt restructured loans with subsequent payment defaults | Loans | Loans	1	1
Financing receivable number of loans past due | Loans	0	0
Provision for loan losses	$ 0	$ 0
Loans default payment past due period	30 days	30 days
Troubled debt restructurings
Financing Receivable Modifications [Line Items]
Specific reserves to loans	$ 111,000		$ 109,000
Allowance adjustment charge offs	0	$ 20,000
Provision for credit losses	$ 0	$ 20,000
Contractual Interest Rate Reduction
Financing Receivable Modifications [Line Items]
Reduction of the notes stated interest rate	3.345%	4.075%
Extended Maturity
Financing Receivable Modifications [Line Items]
Maturity period loans		22 days

XML

Troubled Debt Restructurings (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($) Loan	Mar. 31, 2021 USD ($) Loan
Financing Receivable Modifications [Line Items]
Number of Loans | Loan	3	12
Pre-Modification Outstanding Recorded Investment	$ 78	$ 209
Post-Modification Outstanding Recorded Investment	$ 80	$ 213
Commercial
Financing Receivable Modifications [Line Items]
Number of Loans | Loan		4
Pre-Modification Outstanding Recorded Investment		$ 22
Post-Modification Outstanding Recorded Investment		$ 22
Residential real estate, 1-4 family residential
Financing Receivable Modifications [Line Items]
Number of Loans | Loan	1	1
Pre-Modification Outstanding Recorded Investment	$ 50	$ 69
Post-Modification Outstanding Recorded Investment	$ 52	$ 73
Residential real estate, Home equity lines of credit
Financing Receivable Modifications [Line Items]
Number of Loans | Loan	1	1
Pre-Modification Outstanding Recorded Investment	$ 14	$ 31
Post-Modification Outstanding Recorded Investment	$ 14	$ 31
Consumer, Indirect
Financing Receivable Modifications [Line Items]
Number of Loans | Loan	1	6
Pre-Modification Outstanding Recorded Investment	$ 14	$ 87
Post-Modification Outstanding Recorded Investment	$ 14	$ 87

XML

Credit Quality Indicators (Details Textual) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Financing Receivable Recorded Investment [Line Items]
Maximum commercial loan and commercial real estate relationships	$ 1,000,000
Payments to Acquire Loans Receivable	478,200,000
Loans held for sale	$ 4,000,000.0
PCD Loans
Financing Receivable Recorded Investment [Line Items]
Business combination acquired loans with fair value		$ 34,300,000
Credit discount		1,300,000
Noncredit discount		1,100,000
ASU 2016-13
Financing Receivable Recorded Investment [Line Items]
Change In Accounting Principle Accounting Standards Update Adopted	true
Residential real estate, 1-4 family residential
Financing Receivable Recorded Investment [Line Items]
Other real estate owned properties	$ 0	0
Other real estate properties in foreclosure	$ 216,000	$ 93,000

XML

Credit Quality Indicators (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	$ 1,523,113	$ 1,555,497
Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	1,468,281	1,493,840
Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	23,597	28,903
Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	31,235	32,754
Commercial real estate | Commercial real estate, Owner occupied
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	346,782	339,974
Commercial real estate | Commercial real estate, Owner occupied | Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	338,256	330,754
Commercial real estate | Commercial real estate, Owner occupied | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	4,430	5,006
Commercial real estate | Commercial real estate, Owner occupied | Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	4,096	4,214
Commercial real estate | Commercial real estate, Non-owner occupied
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	539,635	532,706
Commercial real estate | Commercial real estate, Non-owner occupied | Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	506,509	495,170
Commercial real estate | Commercial real estate, Non-owner occupied | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	14,708	19,366
Commercial real estate | Commercial real estate, Non-owner occupied | Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	18,418	18,170
Commercial real estate | Commercial farmland
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	173,271	177,417
Commercial real estate | Commercial farmland | Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	170,456	174,580
Commercial real estate | Commercial farmland | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	2,145	2,160
Commercial real estate | Commercial farmland | Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	670	677
Commercial real estate | Commercial real estate, Other
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	113,347	137,994
Commercial real estate | Commercial real estate, Other | Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	112,473	137,063
Commercial real estate | Commercial real estate, Other | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	499	784
Commercial real estate | Commercial real estate, Other | Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	375	147
Commercial | Commercial and industrial
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	298,549	312,532
Commercial | Commercial and industrial | Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	289,651	301,879
Commercial | Commercial and industrial | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	1,308	1,190
Commercial | Commercial and industrial | Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	7,590	9,463
Commercial | Commercial, Agricultural
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	51,529	54,874
Commercial | Commercial, Agricultural | Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	50,936	54,394
Commercial | Commercial, Agricultural | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	507	397
Commercial | Commercial, Agricultural | Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	$ 86	$ 83

XML

Credit Quality Indicators (Details 1) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Financing Receivable Recorded Investment [Line Items]
Loans	$ 2,304,971	$ 2,331,082
Residential real estate | Residential real estate, 1-4 family residential
Financing Receivable Recorded Investment [Line Items]
Loans	454,762	452,792
Residential real estate | Residential real estate, 1-4 family residential | Performing Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	451,151	448,970
Residential real estate | Residential real estate, 1-4 family residential | Nonperforming Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	3,611	3,822
Residential real estate | Residential real estate, Home equity lines of credit
Financing Receivable Recorded Investment [Line Items]
Loans	128,243	127,450
Residential real estate | Residential real estate, Home equity lines of credit | Performing Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	127,315	126,497
Residential real estate | Residential real estate, Home equity lines of credit | Nonperforming Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	928	953
Consumer | Consumer, Indirect
Financing Receivable Recorded Investment [Line Items]
Loans	173,351	164,760
Consumer | Consumer, Indirect | Performing Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	172,843	164,182
Consumer | Consumer, Indirect | Nonperforming Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	508	578
Consumer | Consumer, Direct
Financing Receivable Recorded Investment [Line Items]
Loans	18,922	21,188
Consumer | Consumer, Direct | Performing Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	18,719	20,908
Consumer | Consumer, Direct | Nonperforming Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	203	280
Consumer | Consumer, Other
Financing Receivable Recorded Investment [Line Items]
Loans	6,580	9,401
Consumer | Consumer, Other | Performing Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	6,580	9,395
Consumer | Consumer, Other | Nonperforming Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	$ 0	$ 6

XML

Credit Quality Indicators (Details 2) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Financing Receivable Recorded Investment [Line Items]
Total	$ 2,304,971	$ 2,331,082
Commercial real estate
Financing Receivable Recorded Investment [Line Items]
2022	34,524
2021	171,373
2020	141,862
2019	173,204
2018	117,110
Prior	341,903
Revolving Loans	19,788
Total	999,764
Commercial real estate | Pass
Financing Receivable Recorded Investment [Line Items]
2022	34,484
2021	170,585
2020	141,201
2019	163,632
2018	114,598
Prior	314,075
Revolving Loans	18,663
Total	957,238
Commercial real estate | Special Mention
Financing Receivable Recorded Investment [Line Items]
2022	0
2021	788
2020	0
2019	6,924
2018	2,020
Prior	9,387
Revolving Loans	518
Total	19,637
Commercial real estate | Substandard
Financing Receivable Recorded Investment [Line Items]
2022	40
2021	0
2020	661
2019	2,648
2018	492
Prior	18,441
Revolving Loans	607
Total	22,889
Commercial
Financing Receivable Recorded Investment [Line Items]
2022	28,958
2021	83,377
2020	48,586
2019	25,392
2018	20,372
Prior	26,213
Revolving Loans	65,651
Total	298,549
Commercial | Pass
Financing Receivable Recorded Investment [Line Items]
2022	28,559
2021	80,860
2020	46,807
2019	25,005
2018	20,084
Prior	24,321
Revolving Loans	64,015
Total	289,651
Commercial | Special Mention
Financing Receivable Recorded Investment [Line Items]
2022	0
2021	533
2020	103
2019	122
2018	31
Prior	2
Revolving Loans	517
Total	1,308
Commercial | Substandard
Financing Receivable Recorded Investment [Line Items]
2022	399
2021	1,984
2020	1,676
2019	265
2018	257
Prior	1,890
Revolving Loans	1,119
Total	7,590
Agricultural Portfolio Segment
Financing Receivable Recorded Investment [Line Items]
2022	9,435
2021	42,689
2020	49,612
2019	27,128
2018	27,013
Prior	53,431
Revolving Loans	15,492
Total	224,800
Agricultural Portfolio Segment | Pass
Financing Receivable Recorded Investment [Line Items]
2022	9,435
2021	42,324
2020	49,368
2019	27,039
2018	27,002
Prior	51,111
Revolving Loans	15,113
Total	221,392
Agricultural Portfolio Segment | Special Mention
Financing Receivable Recorded Investment [Line Items]
2022	0
2021	0
2020	227
2019	31
2018	0
Prior	2,045
Revolving Loans	349
Total	2,652
Agricultural Portfolio Segment | Substandard
Financing Receivable Recorded Investment [Line Items]
2022	0
2021	365
2020	17
2019	58
2018	11
Prior	275
Revolving Loans	30
Total	756
Residential real estate
Financing Receivable Recorded Investment [Line Items]
2022	19,699
2021	102,300
2020	86,291
2019	37,077
2018	29,727
Prior	175,962
Revolving Loans	3,706
Total	454,762
Residential real estate | Pass
Financing Receivable Recorded Investment [Line Items]
2022	19,699
2021	102,254
2020	86,118
2019	36,861
2018	29,617
Prior	167,930
Revolving Loans	3,706
Total	446,185
Residential real estate | Special Mention
Financing Receivable Recorded Investment [Line Items]
2022	0
2021	0
2020	73
2019	127
2018	80
Prior	139
Revolving Loans	0
Total	419
Residential real estate | Substandard
Financing Receivable Recorded Investment [Line Items]
2022	0
2021	46
2020	100
2019	89
2018	30
Prior	7,893
Revolving Loans	0
Total	8,158
Home Equity Lines Of Credit
Financing Receivable Recorded Investment [Line Items]
2022	0
2021	13
2020	161
2019	51
2018	162
Prior	3,370
Revolving Loans	124,486
Total	128,243
Home Equity Lines Of Credit | Pass
Financing Receivable Recorded Investment [Line Items]
2022	0
2021	0
2020	149
2019	0
2018	19
Prior	1,744
Revolving Loans	124,320
Total	126,232
Home Equity Lines Of Credit | Special Mention
Financing Receivable Recorded Investment [Line Items]
2022	0
2021	0
2020	0
2019	0
2018	0
Prior	0
Revolving Loans	48
Total	48
Home Equity Lines Of Credit | Substandard
Financing Receivable Recorded Investment [Line Items]
2022	0
2021	13
2020	12
2019	51
2018	143
Prior	1,626
Revolving Loans	118
Total	1,963
Consumer
Financing Receivable Recorded Investment [Line Items]
2022	24,827
2021	58,660
2020	42,686
2019	31,163
2018	18,189
Prior	17,920
Revolving Loans	5,408
Total	198,853
Consumer | Pass
Financing Receivable Recorded Investment [Line Items]
2022	24,827
2021	58,540
2020	42,425
2019	30,910
2018	18,087
Prior	17,561
Revolving Loans	5,408
Total	197,758
Consumer | Substandard
Financing Receivable Recorded Investment [Line Items]
2022	0
2021	120
2020	261
2019	253
2018	102
Prior	359
Revolving Loans	0
Total	$ 1,095

XML

Credit Quality Indicators (Details 3) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
Financing Receivable Recorded Investment [Line Items]
ACL Balance	$ 27,015	$ 29,386	$ 24,935	$ 22,144
PCD Loans
Financing Receivable Recorded Investment [Line Items]
Loan balances	25,603
ACL Balance	1,118
Commercial real estate
Financing Receivable Recorded Investment [Line Items]
ACL Balance	15,207	15,879	8,844	10,824
Commercial real estate | PCD Loans
Financing Receivable Recorded Investment [Line Items]
Loan balances	23,328
ACL Balance	1,008
Commercial real estate | Commercial real estate, Owner occupied | PCD Loans
Financing Receivable Recorded Investment [Line Items]
Loan balances	2,531
ACL Balance	82
Commercial real estate | Commercial real estate, Non-owner occupied | PCD Loans
Financing Receivable Recorded Investment [Line Items]
Loan balances	20,017
ACL Balance	890
Commercial real estate | Commercial real estate, Other | PCD Loans
Financing Receivable Recorded Investment [Line Items]
Loan balances	780
ACL Balance	36
Commercial
Financing Receivable Recorded Investment [Line Items]
ACL Balance	3,867	4,949	5,450	5,073
Commercial | Commercial, Commercial and industrial | PCD Loans
Financing Receivable Recorded Investment [Line Items]
Loan balances	1,775
ACL Balance	106
Residential real estate
Financing Receivable Recorded Investment [Line Items]
ACL Balance	4,702	$ 4,870	$ 3,961	$ 3,643
Residential real estate | Residential real estate, 1-4 family residential | PCD Loans
Financing Receivable Recorded Investment [Line Items]
Loan balances	500
ACL Balance	$ 4

XML

Revenue from Contracts with Customers (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Disaggregation Of Revenue [Line Items]
TOTAL NONINTEREST INCOME	$ 17,698	$ 10,132
Service Charges on Deposit Accounts
Disaggregation Of Revenue [Line Items]
Noninterest income	1,145	808
Debit Card and EFT Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	1,416	1,171
Trust Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	2,519	2,236
Insurance Agency Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	1,047	1,003
Retirement Plan Consulting Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	397	320
Investment Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	694	504
Operating Segments
Disaggregation Of Revenue [Line Items]
TOTAL NONINTEREST INCOME	17,698	10,132
Operating Segments | Service Charges on Deposit Accounts
Disaggregation Of Revenue [Line Items]
Noninterest income	1,145	808
Operating Segments | Debit Card and EFT Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	1,416	1,171
Operating Segments | Trust Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	2,519	2,236
Operating Segments | Insurance Agency Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	1,047	1,003
Operating Segments | Retirement Plan Consulting Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	397	320
Operating Segments | Investment Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	694	504
Operating Segments | Other
Disaggregation Of Revenue [Line Items]
Other (outside the scope of ASC 606)	10,480	4,090
Operating Segments | Trust Segment
Disaggregation Of Revenue [Line Items]
TOTAL NONINTEREST INCOME	2,916	2,556
Operating Segments | Trust Segment | Service Charges on Deposit Accounts
Disaggregation Of Revenue [Line Items]
Noninterest income	0	0
Operating Segments | Trust Segment | Debit Card and EFT Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	0	0
Operating Segments | Trust Segment | Trust Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	2,519	2,236
Operating Segments | Trust Segment | Insurance Agency Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	0	0
Operating Segments | Trust Segment | Retirement Plan Consulting Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	397	320
Operating Segments | Trust Segment | Investment Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	0	0
Operating Segments | Trust Segment | Other
Disaggregation Of Revenue [Line Items]
Other (outside the scope of ASC 606)	0	0
Operating Segments | Bank Segment
Disaggregation Of Revenue [Line Items]
TOTAL NONINTEREST INCOME	14,782	7,576
Operating Segments | Bank Segment | Service Charges on Deposit Accounts
Disaggregation Of Revenue [Line Items]
Noninterest income	1,145	808
Operating Segments | Bank Segment | Debit Card and EFT Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	1,416	1,171
Operating Segments | Bank Segment | Trust Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	0	0
Operating Segments | Bank Segment | Insurance Agency Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	1,047	1,003
Operating Segments | Bank Segment | Retirement Plan Consulting Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	0	0
Operating Segments | Bank Segment | Investment Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	694	504
Operating Segments | Bank Segment | Other
Disaggregation Of Revenue [Line Items]
Other (outside the scope of ASC 606)	$ 10,480	$ 4,090

XML

Revenue from Contracts with Customers (Details Textual) - USD ($)	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Revenue From Contract With Customer [Line Items]
Legal settlement	$ 8,400,000	$ 0
ASC 606
Revenue From Contract With Customer [Line Items]
Contingent debit card interchange fees	0
Contingent incentive fees	0
Contingent commission	$ 0
Percentage of insurance agency commissions representing total revenue	2.10%
Percentage of retirement plan consulting fees representing total revenue	0.80%
Percentage of investment commissions representing total revenue	1.40%
ASC 606 | Cetera
Revenue From Contract With Customer [Line Items]
Contingent investment commissions to be refunded	$ 0

XML

Fair Value (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Financial Assets
Securities available for sale	$ 1,463,626	$ 1,427,677
Fair Value, Measurements, Recurring
Financial Assets
Total investment securities	1,478,566	1,442,626
Corporate bonds
Financial Assets
Securities available for sale	4,295	4,030
Corporate bonds | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	4,295	4,030
Collateralized mortgage obligations | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	40,325	13,385
Small Business Administration
Financial Assets
Securities available for sale	4,756	5,430
Small Business Administration | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	4,756	5,430
Other investments measured at net asset value | Fair Value, Measurements, Recurring
Financial Assets
Equity securities	14,723	14,721
U.S. Treasury and U.S. government sponsored entities
Financial Assets
Securities available for sale	104,947	90,831
U.S. Treasury and U.S. government sponsored entities | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	104,947	90,831
State and political subdivisions
Financial Assets
Securities available for sale	645,608	658,815
State and political subdivisions | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	645,608	658,815
Mortgage-backed securities - residential
Financial Assets
Securities available for sale	663,695	655,186
Mortgage-backed securities - residential | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	663,695	655,186
Equity securities at fair value | Fair Value, Measurements, Recurring
Financial Assets
Equity securities	217	228
Interest rate swaps | Fair Value, Measurements, Recurring
Financial Assets
Derivative Assets	2,232	4,261
Financial Liabilities
Derivative liabilities	2,232	4,261
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair Value, Measurements, Recurring
Financial Assets
Total investment securities	217	228
Quoted Prices in Active Markets for Identical Assets (Level 1) | Corporate bonds | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Collateralized mortgage obligations | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Small Business Administration | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. Treasury and U.S. government sponsored entities | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | State and political subdivisions | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Mortgage-backed securities - residential | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Equity securities at fair value | Fair Value, Measurements, Recurring
Financial Assets
Equity securities	217	228
Quoted Prices in Active Markets for Identical Assets (Level 1) | Interest rate swaps | Fair Value, Measurements, Recurring
Financial Assets
Derivative Assets	0	0
Financial Liabilities
Derivative liabilities	0	0
Significant Other Observable Inputs (Level 2) | Fair Value, Measurements, Recurring
Financial Assets
Total investment securities	1,463,624	1,427,674
Significant Other Observable Inputs (Level 2) | Corporate bonds | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	4,295	4,030
Significant Other Observable Inputs (Level 2) | Collateralized mortgage obligations | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	40,325	13,385
Significant Other Observable Inputs (Level 2) | Small Business Administration | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	4,756	5,430
Significant Other Observable Inputs (Level 2) | U.S. Treasury and U.S. government sponsored entities | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	104,947	90,831
Significant Other Observable Inputs (Level 2) | State and political subdivisions | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	645,608	658,815
Significant Other Observable Inputs (Level 2) | Mortgage-backed securities - residential | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	663,693	655,183
Significant Other Observable Inputs (Level 2) | Equity securities at fair value | Fair Value, Measurements, Recurring
Financial Assets
Equity securities	0	0
Significant Other Observable Inputs (Level 2) | Interest rate swaps | Fair Value, Measurements, Recurring
Financial Assets
Derivative Assets	2,232	4,261
Financial Liabilities
Derivative liabilities	2,232	4,261
Significant Unobservable Inputs (Level 3) | Fair Value, Measurements, Recurring
Financial Assets
Total investment securities	2	3
Significant Unobservable Inputs (Level 3) | Corporate bonds | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | Collateralized mortgage obligations | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | Small Business Administration | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | U.S. Treasury and U.S. government sponsored entities | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | State and political subdivisions | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | Mortgage-backed securities - residential | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	2	3
Significant Unobservable Inputs (Level 3) | Equity securities at fair value | Fair Value, Measurements, Recurring
Financial Assets
Equity securities	0	0
Significant Unobservable Inputs (Level 3) | Interest rate swaps | Fair Value, Measurements, Recurring
Financial Assets
Derivative Assets	0	0
Financial Liabilities
Derivative liabilities	$ 0	$ 0

XML

Fair Value (Details Textual) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Fair value assets liabilities transfers amount between level 1 and level 2	$ 0	$ 0
Troubled debt restructurings	$ 3,800		$ 3,900
Maximum maturity period of short term borrowings	90 days
Measured Using Present Value of Cash Flows
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Troubled debt restructurings	$ 850		792
Collateral Dependent Loans
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Collateral dependent loans, unpaid principal balance with allowance recorded	893		3,200
Collateral dependent loans, allowance	$ 797		$ 1,500

XML

Fair Value (Details 1) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Reconciliation for all assets measured at fair value on a recurring basis using significant unobservable inputs
Beginning Balance	$ 3	$ 4
Transfers from level 2	0	0
Repayments, calls and maturities	(1)	0
Ending Balance	$ 2	$ 4

XML

Fair Value (Details 2) - Fair Value, Nonrecurring - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Consumer, Indirect
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	$ 14
Residential Real Estate
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	82	$ 82
Commercial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		1,654
Quoted Prices in Active Markets for Identical Assets (Level 1) | Consumer, Indirect
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Residential Real Estate
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Commercial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		0
Significant Other Observable Inputs (Level 2) | Consumer, Indirect
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	0
Significant Other Observable Inputs (Level 2) | Residential Real Estate
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	0	0
Significant Other Observable Inputs (Level 2) | Commercial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		0
Significant Unobservable Inputs (Level 3) | Consumer, Indirect
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	14
Significant Unobservable Inputs (Level 3) | Residential Real Estate
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	$ 82	82
Significant Unobservable Inputs (Level 3) | Commercial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		$ 1,654

XML

Fair Value (Details 3) - Fair Value, Nonrecurring $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)
Consumer, Indirect
Fair value measurements for financial instruments
Recorded Investment	$ 14
Residential Real Estate
Fair value measurements for financial instruments
Recorded Investment	82	$ 82
Commercial
Fair value measurements for financial instruments
Recorded Investment		1,654
Sales Comparison Valuation | Consumer, Indirect
Fair value measurements for financial instruments
Recorded Investment	$ 14
Fair Value Measurements Valuation Technique(s) Description	Sales comparison
Sales Comparison Valuation | Consumer, Indirect | Minimum | Measurement Input, Comparability Adjustment
Fair value measurements for financial instruments
Adjustment for differences between earning multiplier and comparable sales, Percent	(6.08)
Sales Comparison Valuation | Consumer, Indirect | Maximum | Measurement Input, Comparability Adjustment
Fair value measurements for financial instruments
Adjustment for differences between earning multiplier and comparable sales, Percent	6.08
Sales Comparison Valuation | Consumer, Indirect | Weighted Average | Measurement Input, Comparability Adjustment
Fair value measurements for financial instruments
Adjustment for differences between earning multiplier and comparable sales, Percent	0.00
Sales Comparison Valuation | Residential Real Estate
Fair value measurements for financial instruments
Recorded Investment	$ 82	$ 82
Fair Value Measurements Valuation Technique(s) Description	Sales comparison	Sales comparison
Sales Comparison Valuation | Residential Real Estate | Minimum | Measurement Input, Comparability Adjustment
Fair value measurements for financial instruments
Adjustment for differences between earning multiplier and comparable sales, Percent	(3.84)	(3.84)
Sales Comparison Valuation | Residential Real Estate | Maximum | Measurement Input, Comparability Adjustment
Fair value measurements for financial instruments
Adjustment for differences between earning multiplier and comparable sales, Percent	3.22	3.22
Sales Comparison Valuation | Residential Real Estate | Weighted Average | Measurement Input, Comparability Adjustment
Fair value measurements for financial instruments
Adjustment for differences between earning multiplier and comparable sales, Percent	(0.12)	(0.12)
Sales Comparison Valuation | Commercial
Fair value measurements for financial instruments
Recorded Investment		$ 1,654
Fair Value Measurements Valuation Technique(s) Description		Sales comparison
Sales Comparison Valuation | Commercial | Minimum | Measurement Input, Comparability Adjustment
Fair value measurements for financial instruments
Adjustment for differences between earning multiplier and comparable sales, Percent		(40.24)
Sales Comparison Valuation | Commercial | Maximum | Measurement Input, Comparability Adjustment
Fair value measurements for financial instruments
Adjustment for differences between earning multiplier and comparable sales, Percent		56.83
Sales Comparison Valuation | Commercial | Weighted Average | Measurement Input, Comparability Adjustment
Fair value measurements for financial instruments
Adjustment for differences between earning multiplier and comparable sales, Percent		(12.43)

XML

Fair Value (Details 4) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Financial assets
Cash and cash equivalents, Carrying Amount	$ 137,627	$ 112,790
Regulatory stock, Carrying Amount	19,080	15,510
Loans held for sale, Carrying Amount	1,904	4,545
Loans, net, Carrying Amount	2,277,956	2,301,696
Financial liabilities
Deposits, Carrying Amount	3,693,811	3,547,235
Long-term borrowings	87,872	87,758
Fair Value, Measurements, Recurring
Financial assets
Cash and cash equivalents, Fair Value	137,627	112,790
Loans held for sale, Fair Value	1,942	4,681
Loans, net, Fair Value	2,254,714	2,285,554
Financial liabilities
Deposits, Fair Value	3,681,866	3,543,230
Long-term borrowings, Fair Value	84,946	92,433
Fair Value, Measurements, Recurring | Level 1
Financial assets
Cash and cash equivalents, Fair Value	29,224	29,150
Loans held for sale, Fair Value	0	0
Loans, net, Fair Value	0	0
Financial liabilities
Deposits, Fair Value	3,283,963	3,158,967
Long-term borrowings, Fair Value	0	0
Fair Value, Measurements, Recurring | Level 2
Financial assets
Cash and cash equivalents, Fair Value	108,403	83,640
Loans held for sale, Fair Value	1,942	4,681
Loans, net, Fair Value	0	0
Financial liabilities
Deposits, Fair Value	397,903	384,263
Long-term borrowings, Fair Value	84,946	92,433
Fair Value, Measurements, Recurring | Level 3
Financial assets
Cash and cash equivalents, Fair Value	0	0
Loans held for sale, Fair Value	0	0
Loans, net, Fair Value	2,254,714	2,285,554
Financial liabilities
Deposits, Fair Value	0	0
Long-term borrowings, Fair Value	$ 0	$ 0

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Goodwill and Intangible Assets (Details Textual) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Sep. 30, 2021	Dec. 31, 2021
Goodwill And Intangible Assets Disclosure [Abstract]
Goodwill associated with the Company's acquisition and other past acquisitions	$ 94,240			$ 94,240
Goodwill impairment			$ 0
Aggregate amortization expense	$ 420	$ 316

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Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Acquired intangible assets
Gross Carrying Amount	$ 21,026	$ 21,026
Accumulated Amortization	(13,079)	(12,660)
Customer Relationships
Acquired intangible assets
Gross Carrying Amount	7,210	7,210
Accumulated Amortization	(6,679)	(6,641)
Non-compete contracts
Acquired intangible assets
Gross Carrying Amount	430	430
Accumulated Amortization	(393)	(392)
Trade Name
Acquired intangible assets
Gross Carrying Amount	520	520
Accumulated Amortization	(364)	(356)
Core Deposits
Acquired intangible assets
Gross Carrying Amount	12,866	12,866
Accumulated Amortization	$ (5,643)	$ (5,271)

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Goodwill and Intangible Assets (Details 1) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Finite Lived Intangible Assets Future Amortization Expense [Abstract]
2022 (9 months)	$ 1,251
2023	1,198
2024	894
2025	833
2026	741
Thereafter	3,030
Total	$ 7,947	$ 8,366

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Leases (Details Textual) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Lessee Lease Description [Line Items]
Operating leases options to extend [true false]	true
Operating leases options to terminate the lease	1.1 years
Operating lease, description	The Company has operating leases for branch office locations, vehicles and certain office equipment such as printers, copiers and faxes. The leases have remaining lease terms of up to 18 years, some of which include options to extend the lease for up to 15 years and some of which include options to terminate the lease in 1.1 years.
Operating lease, right-of-use asset	$ 6,100		$ 6,400
Operating lease, liability	$ 6,385		$ 6,600
Operating Lease, Liability, Statement of Financial Position [Extensible List]	Other liabilities		Other liabilities
Operating lease, payments	$ 237	$ 202
Finance leases, interest expense	38	36
Finance leases, amortization expense	$ 166	$ 121
Average remaining lease term	5 years 11 months 12 days
Weighted-average discount rate	2.43%
Maximum
Lessee Lease Description [Line Items]
Operating leases remaining lease terms	18 years
Operating leases options to extend	15 years

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Leases (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Leases [Abstract]
2022 (9 months)	$ 596
2023	780
2024	610
2025	603
2026	586
Thereafter	4,245
Total Payments	7,420
Less: Imputed Interest	(1,035)
Total	$ 6,385	$ 6,600

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Derivative Financial Instruments (Details Textual) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Not Designated as Hedging Instrument | Interest Rate Lock Commitments
Derivative [Line Items]
Net Gain or Loss recognized in earnings	$ (286,000)	$ 423,000
Derivative Assets	13,600,000	25,700,000
Interest rate swaps
Derivative [Line Items]
Derivative notional amount	74,900,000	86,100,000
Fair value, other assets	2,200,000	4,000,000.0
Fair value, other liabilities	2,200,000	4,000,000.0
Net Gain or Loss recognized in earnings	$ 0	$ 0

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Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Basic EPS
Net income	$ 15,844	$ 14,556
Weighted average shares outstanding	33,820,485	28,215,772
Basic earnings per share	$ 0.47	$ 0.52
Diluted EPS
Net income	$ 15,844	$ 14,556
Weighted average shares outstanding	33,820,485	28,215,772
Dilutive effect of restricted stock awards	116,453	120,367
Weighted average shares for diluted earnings per share	33,936,938	28,336,139
Diluted earnings per share	$ 0.47	$ 0.51

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Earnings Per Share (Details Textual) - shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Restricted Stock Awards
Earnings Per Share Basic [Line Items]
Anti-dilutive securities excluded from computation of earnings per share	132,492	68,311

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Stock Based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Apr. 30, 2022	Dec. 31, 2017
2017 Incentive Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of shares vested	81,252
Number of shares vested, weighted average fair value	$ 17.44
2017 Incentive Plan | Restricted Stock Awards
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Maximum shares available under equity incentive plan				800,000
Number of shares available for grant	137,383
Stock based compensation expense	$ 365	$ 330
Unrecognized compensation expense	$ 3,700
Compensation cost not yet recognized, period for recognition	2 years 10 months 24 days
2017 Incentive Plan | Time Based Restricted Stock Awards
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share awards granted under equity incentive plan	75,768	19,062
Number of shares vested	15,771	13,081
Number of shares vested, weighted average fair value	$ 17.29	$ 14.34
2017 Incentive Plan | Performance Based Restricted Stock Awards
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share awards granted under equity incentive plan	56,724	52,249
Number of shares vested	65,481	52,327
Number of shares vested, weighted average fair value	$ 17.48	$ 14.34
2022 Plan | Subsequent Event
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Maximum shares available under equity incentive plan			1,000,000

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Stock Based Compensation (Details) - 2017 Incentive Plan - $ / shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vested, Maximum Awarded Units	(81,252)
Vested, Weighted Average Grant Date Fair Value	$ 17.44
Time Based Restricted Stock Awards
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Beginning balance - non-vested shares, Maximum Awarded Unit	99,564	67,765
Granted, Maximum Awarded Units	75,768	19,062
Vested, Maximum Awarded Units	(15,771)	(13,081)
Forfeited, Maximum Awarded Units	0	(2,000)
Ending balance - non-vested shares, Maximum Awarded Unit	159,561	71,746
Beginning balance - non-vested shares, Weighted Average Grant Date Fair Value	$ 16.13	$ 14.32
Granted, Weighted Average Grant Date Fair Value	17.69	14.36
Vested, Weighted Average Grant Date Fair Value	17.29	14.34
Forfeited, Weighted Average Grant Date Fair Value	0.00	13.55
Ending balance - non-vested shares, Weighted Average Grant Date Fair Value	$ 17.13	$ 14.35
Performance Based Restricted Stock Awards
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Beginning balance - non-vested shares, Maximum Awarded Unit	158,988	153,070
Granted, Maximum Awarded Units	56,724	52,249
Vested, Maximum Awarded Units	(65,481)	(52,327)
Forfeited, Maximum Awarded Units	(12,862)	0
Ending balance - non-vested shares, Maximum Awarded Unit	137,369	152,992
Beginning balance - non-vested shares, Weighted Average Grant Date Fair Value	$ 14.40	$ 14.46
Granted, Weighted Average Grant Date Fair Value	17.25	14.09
Vested, Weighted Average Grant Date Fair Value	17.48	14.34
Forfeited, Weighted Average Grant Date Fair Value	14.74	0
Ending balance - non-vested shares, Weighted Average Grant Date Fair Value	$ 15.85	$ 14.37

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Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2022	Mar. 31, 2021
Comprehensive Income Net Of Tax [Abstract]
Unrealized holding losses on available-for-sale securities during the period		$ (112,398)	$ (14,934)
Reclassification adjustment for (gains) losses included in net income, pre-tax	[1]	0	(383)
Net unrealized holding losses		(112,398)	(15,317)
Change in funded status of post-retirement health plan, pre-tax		(2)
Net other comprehensive income (loss), pre-tax		(112,400)	(15,317)
Unrealized holding losses on available-for-sale securities during the period		23,605	3,136
Tax provision related to net realized gain	[1]	0	81
Net unrealized losses on available-for-sale securities		23,605	3,217
Change in funded status of post-retirement health plan, tax		0
Net other comprehensive income (loss), tax		23,605	3,217
Unrealized holding losses on available-for-sale securities during the period		(88,793)	(11,798)
Reclassification adjustment for (gains) losses included in net income, after-tax	[1]	0	(302)
Unrealized holding losses, net of reclassification and tax		(88,793)	(12,100)
Change in funded status of post-retirement plan, net of tax		(2)	0
Other comprehensive loss, net of tax		$ (88,795)	$ (12,100)

[1] Pre-tax reclassification adjustments relating to available-for-sale securities are reported in security gains and the tax impact is included in income tax expense on the consolidated statements of income.

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Regulatory Capital Matters (Details Textual)	Mar. 31, 2022	Dec. 31, 2021
Regulatory Matters (Additional Textual) [Abstract]
Common equity tier 1 capital to risk-weighted assets, capital conservation buffer ratio	2.50%
Tier 1 capital to risk-weighted assets, capital conservation buffer ratio	2.50%
Total capital to risk-weighted assets, capital conservation buffer ratio	2.50%
Minimum ratio of common equity tier 1 capital to risk-weighted assets	4.50%	4.50%
Minimum ratio of tier 1 capital to risk-weighted assets	0.060	0.060
Minimum ratio of total capital to risk-weighted assets	0.080	0.080
Minimum leverage ratio	0.040	0.040
Farmers National Banc Corp
Regulatory Matters (Additional Textual) [Abstract]
Minimum ratio of common equity tier 1 capital to risk-weighted assets	4.50%	4.50%
Minimum ratio of tier 1 capital to risk-weighted assets	0.060	0.060
Minimum ratio of total capital to risk-weighted assets	0.080	0.080
Minimum leverage ratio	0.040	0.040

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Regulatory Capital Matters (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Common equity tier 1 capital ratio
Actual, Amount	$ 373,543	$ 362,950
Actual, Ratio	13.31%	13.16%
Requirement for Capital Adequacy Purposes, Amount	$ 126,292	$ 124,066
Requirement for Capital Adequacy Purposes, Ratio	4.50%	4.50%
Total risk based capital ratio
Actual, Amount	$ 493,558	$ 485,336
Actual, Ratio	0.1759	0.1760
Requirement for Capital Adequacy Purposes, Amount	$ 224,519	$ 220,562
Requirement for Capital Adequacy Purposes, Ratio	0.080	0.080
Tier 1 risk based capital ratio
Actual, Amount	$ 391,543	$ 380,950
Actual, Ratio	0.1395	0.1382
Requirement for Capital Adequacy Purposes, Amount	$ 168,389	$ 165,422
Requirement for Capital Adequacy Purposes, Ratio	0.060	0.060
Tier 1 leverage ratio
Actual, Amount	$ 391,543	$ 380,950
Actual, Ratio	0.0956	0.1012
Requirement for Capital Adequacy Purposes, Amount	$ 163,860	$ 150,629
Requirement for Capital Adequacy Purposes, Ratio	0.040	0.040
Farmers National Banc Corp
Common equity tier 1 capital ratio
Actual, Amount	$ 355,986	$ 345,065
Actual, Ratio	12.75%	12.55%
Requirement for Capital Adequacy Purposes, Amount	$ 125,692	$ 123,712
Requirement for Capital Adequacy Purposes, Ratio	4.50%	4.50%
To be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 181,555	$ 178,695
To be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	6.50%	6.50%
Total risk based capital ratio
Actual, Amount	$ 383,001	$ 374,451
Actual, Ratio	0.1371	0.1362
Requirement for Capital Adequacy Purposes, Amount	$ 223,452	$ 219,933
Requirement for Capital Adequacy Purposes, Ratio	0.080	0.080
To be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 279,315	$ 274,916
To be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	0.100	0.100
Tier 1 risk based capital ratio
Actual, Amount	$ 355,986	$ 345,065
Actual, Ratio	0.1275	0.1255
Requirement for Capital Adequacy Purposes, Amount	$ 167,589	$ 164,950
Requirement for Capital Adequacy Purposes, Ratio	0.060	0.060
To be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 223,452	$ 219,933
To be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	0.080	0.080
Tier 1 leverage ratio
Actual, Amount	$ 355,986	$ 345,065
Actual, Ratio	0.0872	0.0919
Requirement for Capital Adequacy Purposes, Amount	$ 163,207	$ 150,217
Requirement for Capital Adequacy Purposes, Ratio	0.040	0.040
To be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 204,009	$ 187,772
To be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	0.050	0.050

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Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Segment Reporting Information [Line Items]
Goodwill and other intangibles	$ 102,187		$ 102,606
Total assets	4,205,855		4,142,749
Net interest income	31,242	$ 25,267
Provision for credit losses and unfunded loans	(358)	425
Service fees, security gains and other noninterest income	17,698	10,132
Noninterest expense	29,294	16,519
Amortization and depreciation expense	1,162	798
INCOME BEFORE INCOME TAXES	18,842	17,657
Income taxes	2,998	3,101
NET INCOME	15,844	14,556
Eliminations And Others
Segment Reporting Information [Line Items]
Goodwill and other intangibles	(4,263)		(4,263)
Total assets	3,509		3,854
Net interest income	(785)	(54)
Provision for credit losses and unfunded loans	0	0
Service fees, security gains and other noninterest income	(241)	15
Noninterest expense	83	(218)
Amortization and depreciation expense	0	68
INCOME BEFORE INCOME TAXES	(1,109)	111
Income taxes	(298)	(58)
NET INCOME	(811)	169
Trust Segment | Operating Segments
Segment Reporting Information [Line Items]
Goodwill and other intangibles	5,796		5,814
Total assets	19,548		14,365
Net interest income	34	31
Provision for credit losses and unfunded loans	0	0
Service fees, security gains and other noninterest income	9,198	2,603
Noninterest expense	1,769	1,556
Amortization and depreciation expense	28	64
INCOME BEFORE INCOME TAXES	7,435	1,014
Income taxes	1,562	212
NET INCOME	5,873	802
Bank Segment | Operating Segments
Segment Reporting Information [Line Items]
Goodwill and other intangibles	100,654		101,055
Total assets	4,182,798		$ 4,124,530
Net interest income	31,993	25,290
Provision for credit losses and unfunded loans	(358)	425
Service fees, security gains and other noninterest income	8,741	7,514
Noninterest expense	27,442	15,181
Amortization and depreciation expense	1,134	666
INCOME BEFORE INCOME TAXES	12,516	16,532
Income taxes	1,734	2,947
NET INCOME	$ 10,782	$ 13,585

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Short-term borrowings (Details Textual)	3 Months Ended
	Mar. 31, 2022 USD ($) Bank	Dec. 31, 2021 USD ($)
Domestic Line of Credit
Short Term Debt [Line Items]
Access to lines of credit at domestic banks	$ 35,000,000
Number of domestic banks | Bank	2
Unsecured revolving line of credit, outstanding balance	$ 0	$ 0
Revolving Credit Facility
Short Term Debt [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	4.50%
Revolving Credit Facility | Farmers National Banc Corp | Unsecured Debt
Short Term Debt [Line Items]
Unsecured revolving line of credit, outstanding balance	$ 6,500,000
Letter of Credit
Short Term Debt [Line Items]
Unsecured revolving line of credit, outstanding balance	$ 0	0
Debt Instrument, Interest Rate, Stated Percentage	3.50%
Pledged
Short Term Debt [Line Items]
Short-term Federal Home Loan Banks advances	$ 0	$ 0

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Long-term borrowings (Details Textual) - USD ($)				1 Months Ended
	Nov. 01, 2021	Jan. 07, 2020	Dec. 31, 2015	Nov. 30, 2021	Mar. 31, 2022	Dec. 31, 2021
Debt Instrument [Line Items]
Long-rem advances from FHLB					$ 0	$ 0
Residential mortgage, commercial real estate, and multi-family loans					1,300,000,000	$ 1,200,000,000
Additional borrowing limit					$ 679,800,000
Cortland Bank
Debt Instrument [Line Items]
Business acquisition, date of merger agreement	Nov. 01, 2021
Long-term borrowings	$ 4,262,000
Subordinated Notes
Debt Instrument [Line Items]
Aggregate principal amount				$ 75,000,000.0
Maturity date				Dec. 15, 2031
Fixed rate				3.125%
Notes maturity term				5 years
Basis spread on variable rate				220.00%
Net proceeds from sale				$ 73,800,000
Junior Subordinated Debt Securities | Cortland Bank
Debt Instrument [Line Items]
Maturity date	Sep. 15, 2037
Business acquisition, date of merger agreement	Nov. 01, 2021
Long-term borrowings	$ 4,300,000
Interest rate, effective percentage					2.28%	1.65%
Junior Subordinated Debt Securities | Cortland Bank | 3-month LIBOR Rate
Debt Instrument [Line Items]
Basis spread on variable rate	1.45%
Junior Subordinated Debt Securities | Maple Leaf
Debt Instrument [Line Items]
Maturity date		Dec. 15, 2036
Business acquisition, date of merger agreement		Jan. 07, 2020
Interest rate, effective percentage					2.63%	1.90%
Junior Subordinated Debt Securities | Maple Leaf | 3-month LIBOR Rate
Debt Instrument [Line Items]
Basis spread on variable rate		1.70%
Junior Subordinated Debt Securities | National Bancshares Corporation
Debt Instrument [Line Items]
Maturity date			Jun. 15, 2035
Interest rate, effective percentage					2.53%	2.00%
Junior Subordinated Debt Securities | National Bancshares Corporation | 3-month LIBOR Rate
Debt Instrument [Line Items]
Basis spread on variable rate			1.80%

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Long-term borrowings (Details 1) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Debt Instrument [Line Items]
Total junior subordinated debentures owed to unconsolidated subsidiary trusts	$ 14,070	$ 13,988
Subordinated debentures	73,802	73,770
TSEO Statutory Trust I
Debt Instrument [Line Items]
Total junior subordinated debentures owed to unconsolidated subsidiary trusts	2,436	2,424
Maple Leaf Financial Statutory Trust II
Debt Instrument [Line Items]
Total junior subordinated debentures owed to unconsolidated subsidiary trusts	7,349	7,293
Cortland Statutory Trust I
Debt Instrument [Line Items]
Total junior subordinated debentures owed to unconsolidated subsidiary trusts	$ 4,285	$ 4,271