Current Press Releases

QNB Bank Promotes Karstie Burgess to Assistant Branch Manager at Upper Perkiomen Valley Office

Quakertown, PA (February 24, 2021) – Karstie Burgess was recently named Assistant Branch Manager at QNB Bank’s Upper Perkiomen Valley Office. In her role, Karstie is responsible for directing the workflow of the customer service area including supervising, coaching and scheduling staff in order to ensure the efficient operation of the branch.

Karstie has been in banking for 10 years, previously serving as Financial Services Representative Supervisor at QNB’s Upper Perkiomen Valley Office. She earned her high school diploma at Souderton Area High School and earned her Bachelor of Arts degree from Arcadia University.

As an active member in the community, Karstie enjoys supporting various local community events such as American Cancer Society’s annual Relay for Life fundraiser.

QNB Corp. Increases Dividend

Quakertown, PA (February 23, 2021) The Board of Directors of QNB Corp. (OTC Bulletin Board: QNBC), parent company of QNB Bank, at a regular meeting on February 23, 2021 declared a quarterly cash dividend of $0.35 per share. The amount represents a 2.9% increase from the prior quarter. Based upon the closing price of a share as of close of business February 22, 2021, this represents a yield of 4.2%. The cash dividend is payable on March 26, 2021 to shareholders of record March 12, 2021.

“As a result of the continued solid financial performance of QNB Corp., the Board of Directors is pleased to be able to increase the dividend by 2.9%. As a result of its well capitalized position, QNB Corp. is able to continue its uninterrupted history of quarterly dividends,” said David W. Freeman, President and Chief Executive Officer.

QNB Corp. offers commercial and retail banking services through the twelve banking offices of its subsidiary, QNB Bank. QNB Corp.’s stock is traded in the over-the-counter market under the symbol “QNBC.” For more information, visit QNB’s web site at QNBbank.com.

QNB Bank Employees Donate Over $35,000 to United Way

Quakertown, PA (February 8, 2021) – QNB Bank recently held its annual campaign to raise funds for United Way. Led by Patti Cole, this year’s campaign was very successful, tallying up an impressive $29,673 from employees and an additional $5,934 from the Bank for a total contribution of $35,607.

QNB is a full-service community bank that has provided exceptional personalized banking services to individuals and businesses since 1877. With assets of approximately $1.4 billion, QNB currently operates twelve branches in Bucks, Montgomery and Lehigh Counties. More information about QNB is available at QNBbank.com.

QNB Bank Promotes John Ventura to Senior Vice President of Retail Lending, CRA Officer

Quakertown, PA (February 4, 2021) – John Ventura was recently named Senior Vice President of Retail Lending, Community Reinvestment Act (CRA) Officer at QNB Bank. In his role, John is responsible for the efficient, effective management of the Retail Lending Department of the Bank, as well as Community Reinvestment and Fair Lending activities.

John has been in banking for 40 years, previously serving as Chief Lending Officer at Gratz Bank. He also served as the Chief Credit and Administrative Officer at South Eastern Economic Development Corporation of Pennsylvania and Executive Vice President/Chief Lending/CRA Officer at First Savings Bank of Perkasie.

John holds a BA (Cum Laude) in Marketing from Alvernia University. He is also a graduate of the American Bankers Association School of Retail Banking, the PA Bankers School of Commercial Lending, and the Cannon Trust School. He holds an American Bankers Association Certificate in Lending Compliance. He has also taken numerous Risk Management Association (RMA) courses as well as Small Business Administration and PA Bankers Association courses.

John is a member of PA Bankers Association Professional Development Policy Committee and is the Director of the PA Bankers Association Advanced School of Banking. He currently serves as Vice Chairman of the Community Lenders CDC located in Souderton.

QNB Corp. Reports Earnings for Fourth Quarter 2020

Quakertown, PA (January 26, 2021) QNB Corp. (the “Company” or “QNB”) (OTC Bulletin Board: QNBC), the parent company of QNB Bank (the “Bank”), reported net income for the quarter of 2020 of $4,151,000, or $1.17 per share on a diluted basis. This compares to net income of $2,745,000, or $0.78 per share on a diluted basis, for the same period in 2019.  For the year ended December 31, 2020, QNB reported net income of $12,083,000, or $3.42 per share on a diluted basis. This compares to net income of $12,357,000, or $3.53 per share on a diluted basis, reported for the same period in 2019.

For the quarter ended December 31, 2020, the annualized rate of return on average assets and average shareholders’ equity was 1.16% and 12.95%, respectively, compared with 0.88% and 9.06%, respectively, for the fourth quarter 2019.  For the year ended December 31, 2020, the return on average assets and average shareholders’ equity was 0.90% and 9.76%, respectively, compared with 1.02% and 10.58%, respectively, for the same period in 2019.

The following table presents disaggregated net income: 

Earnings

Total assets as of December 31, 2020 were $1,440,229,000 compared with $1,225,023,000 at December 31, 2019.  Loans receivable at December 31, 2020 were $920,042,000 compared with $820,616,000 at December 31, 2019, an increase of $99,426,000, or 12.1%.  QNB Bank originated $82,485,000 in the Small Business Administration’s Paycheck Protection Program (“PPP”) loans, enabling 660 businesses to maintain their payrolls and stay in operation.  Excluding the PPP loans net of deferred fees, loans receivable would have increased $28,514,000, or 3.5% since year-end 2019.  Total deposits at December 31, 2020 were $1,228,067,000, increasing $190,207,000, or 18.3%, compared with $1,037,860,000 at December 31, 2019, with households and businesses keeping their deposits in short-term, liquid accounts.  Most of the PPP loans proceeds were deposited to QNB Bank deposit accounts.

“QNB successfully navigated the COVID-19 pandemic during 2020 from the initial shutdown through the latest CDC guideline updates. Our employees tirelessly worked through multiple rounds of PPP funding to help our business customers and our staff continued to serve customers in a safe manner across various channels from our lobbies to online. Despite the decline in economic activity our earnings remained steady and we continued to see solid growth in our households, deposits and loans. The low interest rate environment contributed to record mortgage originations and our online channel usage increased significantly throughout 2020.”

Net Interest Income and Net Interest Margin

Net interest income for the quarter and year ended December 31, 2020 totaled $9,521,000 and $37,248,000, respectively, an increase of $356,000 and $954,000, respectively, from the same periods in 2019. The net interest margin for the fourth quarters of 2020 and 2019 was 2.82% and 3.11%, respectively.  Net interest margin for the years ended December 31, 2020 and 2019 was 2.92% and 3.16%, respectively.  The yield on average earning assets decreased 72 basis point to 3.20% for the fourth quarter of 2020, compared with the fourth quarter of 2019.  For the year ended December 31, 2020, the yield on average earning assets was 3.42%, compared with 4.02% for the same period in 2019.   The cost of interest-bearing liabilities decreased to 0.50% and 0.63% for the quarter and year ended December 31, 2020, respectively, compared with 1.02% and 1.07% for the same periods in 2019

The decrease in margin is due to repricing loans and prepayment of available for sale investments, and reinvesting in bonds with lower rates, as the general level of interest rates has decreased dramatically starting in February 2020.  In addition to the repricing of the loan and investment portfolio, the decrease in net interest margin is also attributable to the increase in interest-bearing cash as a percentage of earning assets, when comparing the two periods.

Asset Quality, Provision for Loan Loss and Allowance for Loan Loss

QNB recorded a $250,000  provision for loan losses in the fourth quarter of 2020, compared with $375,000 for the same period in 2019.   For the years ended December 31, 2020 and 2019, QNB recorded $1,250,000 and $1,300,000, respectively, in provision for loan losses.  QNB's allowance for loan losses of $10,826,000  represents 1.18% of loans receivable at December 31, 2020 compared to $9,887,000, or 1.20% of loans receivable at December 31, 2019.  Net loan charge-offs were $311,000 for 2020, or 0.04% of total average loans, compared with net charge-offs of $247,000, or 0.03% of total average loans, for the same periods in 2019.

Total non-performing loans, which represent loans on non-accrual status, loans past due 90 days or more and still accruing interest and restructured loans were $14,110,000, or 1.53% of loans receivable at December 31, 2020, compared with $16,464,000, or 2.01% of loans receivable at December 31, 2019.  In cases where there is a collateral shortfall on impaired loans, specific impairment reserves have been established based on updated collateral values even if the borrower continues to pay in accordance with the terms of the agreement. At December 31, 2020, $5,030,000, or approximately 52% of the loans classified as non-accrual are current or past due less than 30 days.  At December 31, 2020 commercial substandard or doubtful loans totaled $22,193,000, compared with $15,922,000 reported at December 31, 2019.   

Non-Interest Income

Total non-interest income was $3,547,000 for the fourth quarter of 2020, an increase of $1,337,000 compared with the same period in 2019, due largely to a $596,000 increase in  unrealized net gains on investment securities to $1,100,000, and increased net gains on sale of loans of $606,000, to $689,000, when comparing the two periods.   

ATM and debit card income increased $45,000, or 8.2% when comparing the fourth quarter 2020 to the same period in 2019, due to increased card activity when comparing the two quarterly periods.  Retail brokerage income increased $17,000 due to increased assets under management.  Other non-interest income increased $104,000;  merchant fee income increased $31,000 (improved revenue sharing arrangement), title insurance income increased $14,000 (increased volume of mortgage originations), letter of credit fees increased $22,000 (increased construction lending), sales of checks to depositors increased $32,000 (instant issue debit card machines from check vendor), and gain on sale of equipment increased $11,000 ($5,000 equipment trade-in value in 2020 versus equipment disposal related to Upper Perkiomen Valley Branch relocation 2019).  Fees for services to customers declined $81,000 during fourth quarter 2020 compared to fourth quarter 2019, due to less overdraft income and service charges on deposits accounts. 

Non-interest income for the year ended December 31, 2020 was $7,602,000, a decrease of $715,000, or 8.6%, compared to the same period in 2019, of which $1,963,000 is attributable to decreased combined realized and unrealized gain on equity securities. This decrease was partially offset by net gain on sale of loans which increased $1,529,000, due to increased mortgage loan originations and secondary market sales, the result of lower interest rates throughout the year.

Non-Interest Expense

Total non-interest expense was $7,611,000 for the fourth quarter of 2020, decreasing $21,000 from $7,632,000 for the same period in 2019.  Salaries and benefits expense decreased $150,000, or 3.4%, to $4,302,000 when comparing the two quarters.  Salary expense and related payroll taxes decreased $93,000 to $3,670,000, or 2.5%, during the fourth quarter of 2020 compared to the same period in 2019, due to decreased incentive compensation and deferred loan origination cost, offset in part by increased employee salary expense.  Benefits expense decreased $56,000, or 8.1%, due primarily to a decrease in medical insurance claims expense., when comparing the two periods. 

Net occupancy and furniture and equipment expense increased $43,000, or 3.4%, to $1,297,000 for the fourth quarter 2020, due primarily to increased building repairs and maintenance and software maintenance and amortization expense, offset in part by decreased building and furniture and fixtures depreciation expense.  Other non-interest expense increased $86,000 when comparing the fourth quarter of 2020 with the fourth quarter of 2019, due primarily to increased FDIC insurance costs offset in part by reduced expense related to charge-off loss, marketing, state taxes, travel and entertainment.  Marketing and travel and entertainment expense reductions are due to cancellation of events, seminars and travel due the COVID-19 pandemic.  Increased FDIC insurance is due to a surplus fund credit received in 2019.  State tax increase is due to the increased shares tax, resulting from increased bond portfolio valuation at the bank in 2020 compared to 2019. 

For the year ended December 31, 2020, non-interest expense increased $851,000, or 3.0%, from the same period in 2019, primarily for the same reasons as detailed in the quarter. 

Provision for income taxes increased $433,000, to $1,056,000 in the fourth quarter 2020, compared with the same period in 2019, due to increased pre-tax income and a higher effective tax rate in 2020.  The effective tax rates for the quarter and year ended December 31, 2020 were 20.3% and 17.5%, respectively.  This compares with effective tax rates for the same periods in 2019 of 18.5% and 18.7%, respectively.

About the Company

QNB Corp. is the holding company for QNB Bank, which is headquartered in Quakertown, Pennsylvania. QNB Bank currently operates twelve branches in Bucks, Montgomery and Lehigh Counties and offers commercial and retail banking services in the communities it serves. In addition, the Company provides securities and advisory services under the name of QNB Financial Services through a registered Broker/Dealer and Registered Investment Advisor, and title insurance as a member of Laurel Abstract Company LLC. More information about QNB Corp. and QNB Bank is available at www.qnbbank.com.

Forward Looking Statement

This press release may contain forward-looking statements as defined in the Private Securities Litigation Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various factors. Such factors include the possibility that increased demand or prices for the Company’s financial services and products may not occur, changing economic and competitive conditions, technological developments, and other risks and uncertainties, including those detailed in the Company’s filings with the Securities and Exchange Commission, including "Item lA. Risk Factors," set forth in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2019. You should not place undue reliance on any forward-looking statements. These statements speak only as of the date of this press release, even if subsequently made available by the Company on its website or otherwise. The Company undertakes no obligation to update or revise these statements to reflect events or circumstances occurring after the date of this press release.

Earnings

Earnings

Earnings

QNB Bank Promotes Jackie Thomas to Assistant Vice President, Branch Manager at Colmar Office

Quakertown, PA (January 7, 2021) – Jackie Thomas was recently named Assistant Vice President, Branch Manager at QNB Bank’s Colmar Office. In her role, Jackie is responsible for the efficient, effective management of the Branch, as well as coaching Branch staff, developing new business and retaining and expanding existing relationships within the Colmar market.

Jackie has been in banking for 12 years, previously serving as Assistant Branch Manager at QNB’s Coopersburg Office. She earned her high school diploma at Pennridge High School, a Supervisor Certificate from PA Bankers and plans to attend the PA Bankers School of Banking in 2021.

Jackie lives in Quakertown with her family. As an active member in the community, she enjoys supporting various local community events and is a participating member of the Montgomery County Chamber of Commerce.

QNB Bank Promotes Melissa Brindley to Vice President, Branch Manager at Coopersburg Office

Quakertown, PA (December 29, 2020) – Melissa Brindley was recently named Vice President, Branch Manager at QNB Bank’s Coopersburg Office. In her role, Melissa is responsible for the efficient, effective management of the Branch, as well as coaching Branch staff, developing new business and retaining and expanding existing relationships within the Coopersburg market.

Melissa has been in banking for 13 years, previously serving as Vice President, Branch Manager at QNB’s Colmar Office. She earned her associate degree from Bucks County Community College and has completed several Pennsylvania Bankers Association courses.

Melissa lives in Perkasie with her family. As an active member in the community, she serves as Co-Chair of the Young Professionals Council for the Greater Montgomery County Chamber of Commerce. Melissa also enjoys participating in and supporting various local community events.

QNB Corp. Declares Dividend

Quakertown, PA (November 24, 2020) The Board of Directors of QNB Corp. (OTC Bulletin Board: QNBC), parent company of QNB Bank, at a regular meeting on November 24, 2020 declared a quarterly cash dividend of $0.34 per share. The cash dividend is payable on December 24, 2020 to shareholders of record December 10, 2020.

QNB Corp. offers commercial and retail banking services through the twelve banking offices of its subsidiary, QNB Bank. QNB Corp.’s stock is traded in the over-the-counter market under the symbol “QNBC.” For more information, visit QNB’s web site at QNBbank.com.

QNB Bank Unveils 2021 Collector Calendar

Quakertown, PA (November 10, 2020) – Another New Year is just around the corner and with that comes the annual QNB Student Art Collector Calendar. Like years past, an art contest was held, open to high school students from surrounding districts. This year’s contest received a total of 33 entries from 9 different schools. The 2021 “Flowers, Plants & Trees” Calendar is available now at all QNB Bank locations. Stop in and pick one up for free while supplies last!

QNB Corp. Reports Earnings for Third Quarter 2020

Quakertown, PA (October 27, 2020) QNB Corp. (the “Company” or “QNB”) (OTC Bulletin Board: QNBC), the parent company of QNB Bank, reported net income for the third quarter of 2020 of $3,778,000, or $1.07 per share on a diluted basis, compared to net income of $3,090,000, or $0.88 per share on a diluted basis, for the same period in 2019. For the nine months ended September 30, 2020, QNB reported net income of $7,932,000, or $2.25 per share on a diluted basis. This compares to net income of $9,612,000, or $2.75 per share on a diluted basis, reported for the same period in 2019.

The increase in quarterly net income and earnings per share, when comparing the three months ended September 30, 2020 with the same period in 2019 is due primarily to an increased gain on sale of mortgage loans originated, and improvement in the fair value of the equity securities held by QNB Corp, our bank holding company. The decrease in net income and earnings per share when comparing the nine-month periods is due primarily to the decrease in the fair value of the equity securities held by QNB Corp. 

The following table presents disaggregated net income: 

Earnings

Total assets as of September 30, 2020 were $1,417,073,000 compared with $1,225,023,000 at December 31, 2019.  Loans receivable at September 30, 2020 were $887,792,000 compared with $820,616,000 at December 31, 2019, an increase of $67,176,000, or 8.2%.  QNB Bank originated $82,475,000 in the Small Business Administration’s Paycheck Protection Program (“PPP”) loans, enabling 660 businesses to maintain their payrolls and stay in operation.  Excluding the PPP loans net of deferred fees, loans receivable would have decreased $12,891,000, or 1.6% since year-end 2019.  Total deposits at September 30, 2020 were $1,214,463,000, increasing $176,603,000, or 17.0%, compared with $1,037,860,000 at December 31, 2019, with households and businesses keeping their deposits in short-term, liquid accounts.  Most of the PPP loans proceeds were deposited to QNB Bank deposit accounts.

“QNB Bank continues to adapt to the current environment. Since June 5, we are operating our branch locations at full capacity, while adhering to health department guidance.  Earnings and loan quality remain strong in this difficult operating environment.  Household and deposit growth remain strong as well, and we have had record year with mortgage loan volume – both refinance and purchase.” stated David W. Freeman, President and Chief Executive Officer. 

Net Interest Income and Net Interest Margin

Net interest income for the quarter and nine months ended September 30, 2020 totaled $9,330,000 and $27,727,000 respectively, an increase of $148,000 and $598,000, respectively from the same periods in 2019. Net interest margin was 2.78% for the third quarter of 2020 and 3.14% for the same period in 2019.  Net interest margin was 2.96% for the nine months ended September 30, 2020, compared with 3.17% for the same period in 2019.   The increase in net interest income is due to the increase in average earning assets, including loans, investments and interest-bearing cash in banks, for the three and nine-month periods ending September 30, 2020, compared with the same periods in 2019. 

The yield on earning assets was 3.20% for the third quarter 2020, a decrease of 82 basis points from 4.02% in the third quarter of 2019. For the nine-month period ended September 30, 2020, yield on earning assets was 3.50%, compared with 4.05% for the same period in 2019.  The cost of interest-bearing liabilities decreased 57 basis points to 0.53% for the quarter and 41 basis points to 0.68% for the nine months ended September 30, 2020, compared with the same period in 2019.   The decrease in margin is due to repricing loans and prepayment of available for sale investments, and reinvesting in bonds with lower rates, as the general level of interest rates has decreased dramatically starting in February 2020.  In addition to the repricing of the loan and investment portfolio, the decrease in net interest margin is also attributable to the increase in interest-bearing cash as a percentage of earning assets, when comparing the two periods.  

Asset Quality, Provision for Loan Loss and Allowance for Loan Loss

QNB recorded a $250,000 provision for loan losses in the third quarter of 2020 compared with $550,000 in the third quarter 2019. QNB's allowance for loan losses of $10,765,000 represents 1.21% of loans receivable at September 30, 2020 compared to $9,887,000, or 1.20% of loans receivable at December 31, 2019, and $9,494,000, or 1.14% of loans receivable at September 30, 2019. Excluding the PPP loans, which are expected to be fully forgiven within the next three to eighteen months, and are 100% guaranteed by the US Treasury, the allowance represents 1.33% of loans receivable. Net loan recoveries were $51,000 and net loan charge offs were $122,000 for the quarter and nine months ended September 30, 2020, respectively, compared with charge offs of $220,000 and $265,000 for the same periods in 2019, respectively. Annualized net loan recoveries/charge-offs for the quarter and nine months ended September 30, 2020 were -0.02% and 0.02% of average loans receivable, respectively.

Total non-performing loans, which represent loans on non-accrual status, loans past due 90 days or more and still accruing interest and restructured loans, were $14,666,000, or 1.65% of loans receivable at September 30, 2020, compared with $16,464,000, or 2.01% of loans receivable at December 31, 2019, and $14,088,000, or 1.70% of loans receivable at September 30, 2019.  In cases where there is a collateral shortfall on impaired loans, specific impairment reserves have been established based on updated collateral values even if the borrower continues to pay in accordance with the terms of the agreement. At September 30, 2020, $4,961,000, or approximately 50% of the loans classified as non-accrual are current or past due less than 30 days.  Commercial loans classified as substandard or doubtful totaled $16,716,000 at September 30, 2020, an increase of $794,000, or 5.0%, from the $15,922,000 reported at December 31, 2019, and a decrease of $269,000, or 1.6%, from the $16,985,000 reported at September 30, 2019.  The increase in loans classified as substandard is due to the downgrade of a large credit in third quarter 2020, net of repayments of existing substandard loans since September 30, 2019.

Non-Interest Income

Total non-interest income was $2,809,000 for the third quarter of 2020, an increase of $665,000, or 31.0%, compared with the same period in 2019, due primarily to a $526,000 increase in net gains on sale of loans, the result of increased sales of mortgage loans originated, stemming from the low interest rate environment, when comparing the two periods. For the three months ended September 30, 2020, QNB sold $11,563,000 in mortgage loans, compared with $2,179,000 million for the same period in 2019. 

Combined  realized and unrealized gains of the equity securities portfolio was $810,000 for the quarter and $796,000 loss for the nine months ended September 30, 2020.  There was a small gain on sale of debt securities for the same periods.  The equities portfolio comprises blue-chip large-capitalized stocks, providing a taxable equivalent dividend yield of 2.97%.   The performance of the portfolio during the quarter and nine months ended September 30, 2020 is commensurate with the overall performance of the U.S. stock market.  

ATM and debit card income increased $65,000, to $598,000 when comparing the two periods.  Other income increased for the period due to increased fair value of mortgage servicing rights and title company income.  Fees for services to customers and retail brokerage and advisory  income decreased $133,000 and $4,000, respectively, when comparing the two periods.  The reduction in fees for services to customers is due primarily to a decrease in overdraft items when comparing the periods.  

For the nine months ended September 30, 2020, non-interest income was $4,055,000, a decrease of $2,052,000, or 33.6%, compared to the same period in 2019, primarily due to combined decrease in net realized gains and unrealized change in fair value of the equities securities totaling  $2,661,000, and a decrease in fees for services to customers of $295,000, for the same reasons as described above.  The estimated cumulative contribution (realized and unrealized net gains, plus dividends) of the equities portfolio to diluted earnings per share from January 1, 2008 through September 30, 2020 is $1.50.

Excluding the realized gain and change in fair value of equities, non-interest income increased $609,000, when comparing the two periods, for the same reasons those described in the quarterly results.

Non-Interest Expense

Total non-interest expense was $7,197,000 for the third quarter of 2020, increasing $242,000, or 3.5% from $6,955,000  for the same period in 2019.  Salaries and benefits expense increased $119,000, or 2.9%, to $4,182,000 when comparing the two quarters.  Salary expense and related payroll taxes decreased $42,000, to $3,467,000 during the third quarter 2020 compared to the same period in 2019 due to a reduction in bonus accrual and increased loan origination deferred costs resulting from the mortgage loan originations of $71,000 and $88,000, respectively.  Employee salaries increased $114,000, or 3.7%, when comparing the periods.     Medical premiums increased $149,000, or 36.7%, due to increased medical claims when comparing the two periods.  Net occupancy and furniture and equipment expense increased $116,000, or 10.3%, to $1,239,000 for the third quarter 2020, due primarily to increased depreciation expense, building maintenance and combined amortization of software, software maintenance and computer backup expense of $23,000, $39,000, and $58,000 respectively, offset in part by decreased equipment maintenance of $8,000, when comparing the two periods.  QNB’s new Allentown branch opened late in the third quarter and the Upper Perkiomen branch had not yet relocated until fourth quarter 2019. 

Other non-interest expense increased $7,000 when comparing third quarter of 2020 and 2019 with decreased marketing, postage, supplies, telecommunication, regulatory assessment and travel and entertainment expenses of $130,000, $8,000, $10,000, $12,000, $20,000 and $54,000, respectively, offset in part by increased FDIC insurance expense and state tax of $140,000 and $72,000, respectively.  Marketing and travel and entertainment expense reductions are due to cancellation of events, seminars and travel due the COVID-19 pandemic.  Increased FDIC insurance is due to a surplus fund credit received in 2019.  State tax increase is due to the increased shares tax, resulting from increased bond portfolio valuation at the bank in 2020 compared to 2019. 

For the nine months ended September 30, 2020, non-interest expense was $21,344,000, an increase of $872,000, or 4.3%, compared to the same period in 2019.  Salary and benefits increased $605,000, or 5.2%, to $12,239,000 and net occupancy and furniture and equipment increased $335,000, or 10.2% to $3,617,000 for the same reasons as the quarterly increase.  FDIC insurance and state taxes also increased $153,000 and $96,000  when comparing the two periods, for the same reasons as the quarterly increase.

Provision for income taxes increased 25%, to $914,000 in the third quarter 2020 due to increased pre-tax income and a higher effective tax rate,  compared with the same period in 2019.  The effective tax rates for the quarter and nine months ended September 30, 2020  were 19.5% and 16.0%, respectively, compared with 19.1% and 18.8%, respectively, for the same periods in 2019.  The variance in effective tax rates is due to the decrease in proportional share of taxable versus non-taxable income and the change in fair value of the equities investments during the quarter and nine months ended September 30, 2020, compared with the same period in 2019.

About the Company

QNB Corp. is the holding company for QNB Bank, which is headquartered in Quakertown, Pennsylvania. QNB Bank currently operates twelve branches in Bucks, Montgomery and Lehigh Counties and offers commercial and retail banking services in the communities it serves.  More information about QNB Corp. and QNB Bank is available at www.qnbbank.com.

Forward Looking Statement

This press release may contain forward-looking statements as defined in the Private Securities Litigation Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various factors. Such factors include the possibility that increased demand or prices for the Company’s financial services and products may not occur, changing economic and competitive conditions, technological developments, and other risks and uncertainties, including those detailed in the Company’s filings with the Securities and Exchange Commission, including "Item lA. Risk Factors," set forth in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2019. You should not place undue reliance on any forward-looking statements. These statements speak only as of the date of this press release, even if subsequently made available by the Company on its website or otherwise. The Company undertakes no obligation to update or revise these statements to reflect events or circumstances occurring after the date of this press release.

Earnings

Earnings

Earnings

Pages