Farmers National Banc (FMNB) 8-K This presentation contains forward-looking statements within the meaning of the Private Securities Litigation

Investor Presentation

September 30, 2014

Exhibit 99.1

2

Disclosure Statement

Forward-Looking Statements

This presentation contains forward-looking statements within the meaning of the Private Securities Litigation

Reform Act of 1995.  Forward-looking statements express management’s current expectations, forecasts of future

events or long-term-goals and, by their nature, are subject to assumptions, risks and uncertainties.  Actual results

could differ materially from those indicated.  Farmers National Banc Corp. (“Farmers”) refers you to its periodic

reports and registration statements filed with the Securities and Exchange Commission, including its Annual

Report on Form 10-K for the year ended December 31, 2013 and Quarterly Report on Form 10-Q for the period

ended September 30, 2014 which have been filed with the Securities and Exchange Commission and are available

on Farmers’ website (www.farmersbankgroup.com) and on the Securities and Exchange Commission’s website

(www.sec.gov), for additional discussion of these assumptions, risks and uncertainties. Forward-looking statements

are not guarantees of future performance and should not be relied upon as representing management’s views as of

any subsequent date.  Farmers undertakes no obligation to update forward-looking statements, whether as a result

of new information, future events or otherwise, except as may be required by law. 

Use of Non-GAAP Financial Measures

This presentation contains certain financial information determined by methods other than in accordance with

accounting principles generally accepted in the United States (“GAAP”).  These non-GAAP financial measures

include “Core Deposits” and “Pre-tax, Pre-provision Earnings”.  Farmers believes that these non-GAAP financial

measures provide both management and investors a more complete understanding of the Company’s deposit profile

and profitability.   These non-GAAP financial measures are supplemental and are not a substitute for any analysis

based on GAAP financial measures.  Because not all companies use the same calculation of “Core Deposits” and

“Pre-tax, Pre-provision Earnings”, this presentation may not be comparable  to other similarly titled measures as

calculated by other companies.  

3

About Farmers National Banc Corp.

•

Strong Capital Position

•

Strong Asset Quality

•

Loan Growth

•

Diversifying Revenue Stream

•

Controlling Non-interest Expenses (PIC)

•

Headquarters: Canfield, OH

•

Assets: $1.14 billion

•

Loans: $647 million

•

Deposits: $913.0 million

•

Banking Locations: 19

Growing Community

Financial Services

Company

•

Stock Price (10-31-14): $8.10

•

Market Capitalization (10-31-14): $150.33 million

•

Dividend (yield): $0.12 (1.50%) 

•

Cash Dividends: $1.7 million

•

Tangible Book Value: $6.02

Stock Data –

NASDAQ: FMNB

•

Revenue: $38.1 million

Market share

•

Net Income: $6.8 million

•

Net Income-Diluted Share: $0.36        

•

ROAA: 0.80%

•

ROAE: 7.63%                                      

Operating Results for

Nine Months Ended

9/30/14

Operating Strategy

-

#16 Stark

-

#6 Trumbull

-

#3 Columbiana 

-

#4 Mahoning

Years of Experience

FMNB

Industry

President & Chief Executive Officer

Kevin J. Helmick (42)

20+

20+

EVP, Chief Financial Officer

Carl D. Culp (51)

25+

29+

EVP, Chief Credit Officer

Mark L. Graham (59)

36+

36+

SVP, Chief Retail & Marketing Officer

Amber Wallace (48)

6+

6+

SVP, Chief Information Officer

Brian Jackson (45)

5+

21+

Community

President

-

Stark

County

&

Chief

Lending Officer

Joseph Gerzina (58)

3+

32+

SVP, Director of Human Resources

Mark A. Nicastro (43)

5+

16+

VP, Chief Risk Officer

Dale Sturdevant (60)

3+

24+

VP, Director of Commercial Banking & Private

Client

Services

-

Mahoning

Valley

Tim Shaffer (52)

2+

28+

President, Farmers Trust Company

Joseph J. DePascale (49)

3+

20+

President, National Associates Inc.

Gerrit C. Kuechle (73)

1+

40+

•

Established and experienced management team with over 272 years of combined experience,

109 of which has been with Farmers.

Experienced Management Team

4

5

Who We Are

•

Leading community bank in Ohio with deposit market share in the

top ten in the core counties in which we operate

–

Founded over 127 years ago

–

19 banking locations and 19 ATMs

•

Sound franchise with commitment to independence and positioned

for growth

•

Profitable throughout cycle, growing tangible book value per share

and growth in current year earnings

•

Diversified and growing revenue streams

•

Compelling valuation:

–

1.33x of tangible book value

–

11.30x LTM pre-tax pre-provision earnings (excludes security gains)

–

1.50% dividend yield

6

Note: Deposit data as of June 30, 2012           Source: SNL

•

Opportunity for growth with approximately 10.50% deposit market share in the Mahoning Valley

–

Large regional competitors lack focus                        -

Community competitors inwardly focused

Attractive Deposit Franchise –

Deposit Market Share by MSA & County

Columbiana Top 10

2014

Rank

Company

Branches

Dep.

($M)

Market

Share

1

Huntington National Bank

11

341,146

25.45

2

Home Savings and Loan Co. of Youngstown

6

243,226

18.14

3

Farmers National Bank of Canfield

3

140,433

10.48

4

JPMorgan Chase Bank NA

3

122,844

9.16

5

PNC Bank NA

3

104,040

7.76

6

1

st

National Community Bank

4

100,780

7.52

7

Consumers National Bank

3

96,128

7.17

8

CFBank

2

85,322

6.36

9

Citizens Bank NA

1

46,937

3.50

10

KeyBank NA

1

42,666

3.18

Total for Institutions in the Market

40

1,340,573

100.00

Mahoning Top 10

2014

Rank

Company

Branches

Dep.

($M)

Market

Share

1

Huntington National Bank

20

1,243,177

29.38

2

Home Savings and Loan Co. of Youngstown

11

771,832

18.24

3

PNC Bank NA

9

553,655

13.09

4

Farmers National Bank of Canfield

8

529,809

12.52

5

JPMorgan Chase Bank NA

7

397,944

9.41

6

Talmer Bank and Trust

8

345,916

8.18

7

First National Bank of Pennsylvania

5

209,867

4.96

8

KeyBank NA

4

79,576

1.88

9

Citizens Bank NA

2

58,291

1.38

10

Cortland Savings and Banking Co.

2

39,622

0.94

Total for Institutions in the Market

77

4,230,898

100.00

Trumbull Top 10

2014

Rank

Company

Branches

Dep.

($M)

Market

Share

1

Huntington National Bank

15

570,189

20.98

2

Talmer Bank and Trust

8

427,268

15.72

3

JPMorgan Chase Bank NA

9

420,471

15.47

4

Cortland Savings and Banking Co.

7

340,862

12.54

5

PNC Bank NA

5

261,889

9.64

6

Farmers National Bank of Canfield

7

230,625

8.49

7

Home Savings and Loan Co. of Youngstown

4

126,483

4.65

8

First National Bank of Pennsylvania

3

96,020

3.53

9

Citizens Bank NA

3

64,789

2.38

10

Home FS&LA of Niles Ohio

1

61,914

2.28

Total for Institutions in the Market

66

2,717,421

100.00

* YTD as of 9-30-14

600.0

650.0

700.0

750.0

800.0

850.0

900.0

950.0

08

09

10

11

12

13

14*

Total Deposits

($ in millions)

7

Commitment to Independence

•

Four Pillars

–

Shareholders

o

2014 Strategic Initiative

o

Increased Communication Plan

–

Customers

o

Small Business Support

o

45% of small business lending                                  

comes from community banks*

–

Associates

o

331 associates

o

Top 100 employer in the region

–

Community

o

$189,059 Annual Giving

*Source: FDIC

Quarterly

Banking

Profile

-

Second

Quarter

2014

Education

/

Higher

Education

$43,766

Social Services

$46,027

Health &

Wellness

$40,510

Civic

$41,793

Arts

$11,560

Community

Athletics

$3,727

Religious

$1,675

2014 Community Giving: $189,059

YTD 10/23/14

8

Increasing Shareholder Value

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10

11

12

13

14*

Stock Price

Stable Dividend Policy

•

Consistently paid a quarterly cash

dividend

•

Current yield 1.50%

•

Dividend payout through September

30, 2014 was 24.71% of net income

9

Headquartered in Mahoning Valley

Compelling Demographics

•

Approximately 75 -

100 miles from

Cleveland, Pittsburgh & Erie

•

6.8 million people within 100 mile radius

•

17 Fortune 500 company world

headquarters

•

95 colleges and universities campus

locations

•

Northeast Ohio’s manufacturing

productivity is on track to outpace the rest

of the nation by 10 percent as early as 2015,

according to a report released by Team

Northeast Ohio.

•

Land acquisition, construction and labor

costs are significantly below national

averages.

10

•

Youngstown Business Incubator ranked No. 1 in the world by the 2014 University

Business Incubator Index

•

The TechBelt Initiative received the International Economic Development

Council’s Bronze Award for 2013

•

Youngstown-Warren Metro ranked number one in the USA in export growth

percentage from 2009-2012 by the Brookings Institute

•

Economic Growth Potential category among U.S. metro areas with less than

450,000 people employed

•

Victory

Media,

Inc.

names

Youngstown

a

“Top

50

Military

Friendly

City”

for

2013

•

General

Motors

committed

an

investment

of

more

than

$250

million

in

the

past

three years to manufacture the Chevrolet Cruze at the Lordstown Assembly Plant

Regional Growth Opportunities

Source: Regional Chamber, Valley Economic Update, Economic Development Report Card, 2013 Reporting Year

Source: Regional Chamber, Youngstown-Warren, Ohio Metropolitan Profile ,Valley Leads in Industrial Job Growth in NE Ohio, The Vindicator ,Ohio’s Economic Impact Study – September, 2011 & 2012

Business Facilities Magazine

ranked Youngstown-Warren Metro area sixth in the

11

Source: Regional Chamber, Valley Economic Update, Economic Development Report Card, 2013 Reporting Year

•

$1.5 billion project investment in the Youngstown-Warren region in 2013

Regional Growth Opportunities

Agency-Assisted

Investment

600,271,951

Transportation/

Infrastructure

34,171,647

D6 Public Works

Commission

31,831,720

Area Construction

671,267,000

Company-Completed

Investment

198,286,500

Total Amounts: $1,535,828,818

12

Source: Regional Chamber, Youngstown-Warren, Ohio Metropolitan Profile ,Valley Leads in Industrial Job Growth in NE Ohio, The Vindicator

,Ohio’s Economic Impact Study –

September,

2013

Ohio Department of Natural Resources, 2014, Horizontal Utica-Point Pleasant Well Activity in Ohio: Columbus, scale 1:1,300,000, revised 7/11/2014.

•

Energy Products

–

As of July 5, 2014, 472 wells reported

production

•

Economic Impact

–

Ohio’s Natural Gas/Crude Oil

Exploration Production Industry and the

Utica Gas Formation impact:

o

Jobs (204,000 created or supported

by 2015)

o

Income (Economic Output will

increase by over $22 billion by

2015)

Utica Shale Impact

13

•

Key Commitments

–

Steelmaker Vallourec’s $650 million

expansion

-

350

jobs

created.

($57

million Finishing Plant)

–

Exterran

$13

million

plant

-

100

jobs

created

–

Pennant Midstream, LLC constructed a

$375 million pipeline and natural gas

processing plant in eastern Mahoning

County. The Hickory Bend Pipeline

System and associated cryogenic gas-

processing plant is ready to begin

operation.

Utica Shale Impact

Source: Regional Chamber, Youngstown-Warren, Ohio Metropolitan Profile ,Valley Leads in Industrial Job Growth in NE Ohio, The Vindicator ,Ohio’s Economic Impact Study – September, 2013

Farmers’

Strategy

for

Growth

•

Growth of Non Interest Income Through Wealth Management and

Bank Fee Revenues

•

Grow Loan Production Volume

•

Technology and the Automated Virtual Bank

–

Continued investment in rapidly expanding mobile opportunities

•

Expense Control

•

Company Culture

•

Enterprise Risk Management

•

Acquisition or “Lift Outs”

•

Shareholder Management

14

Virtual Bank

15

Competitive Landscape

•

Regulatory and Competitive Landscape

–

Significant Competition for Customer’s Share of Wallet

–

Consolidation of Banks in Ohio and Nationally

–

Increasing Regulatory Concerns

–

Economic Challenges

•

Strategy for Profitability

–

Strong Capital Position

–

Strong Asset Quality

–

Loan Growth

–

Diversifying Revenue Stream

–

Controlling Non-interest Expenses

o

Profit Improvement Committee

16

17

•

Focus for Growth

–

Continued organic growth in current markets

–

Growth opportunities in new markets with Private Banking, Trust

and Investments

–

Targeted acquisitions include fee-based business and banks

•

Target Metrics for Acquisition

–

Accretive to earnings near term (excluding one-time charges)

–

Manageable initial tangible book value dilution

–

Growth of fee revenue to 30+% of total revenue

–

Must enhance shareholder value

–

Must sustain our culture

–

Not materially change our investment merits

–

Sustain our TCE and regulatory ratios

Growth Focus and Target Metrics

The Health of Our Wealth

•

Wealth Management Creates Fee-based Income

–

Fee Income 2009: 14.5% of total gross income

o

Noninterest income excluding security gains

–

Fee Income 2014 YTD*: 29% of total gross income

o

Noninterest income excluding security gains

•

Wealth Management Build-out Timeline

–

2000 Farmers National Investments

–

2009 Farmers Trust Company

–

2010 Farmers National Insurance

–

2012 Private Client Services

–

2013 National Associates, Inc.

* YTD as of 9-30-14

18

19

•

Butler Wick Trust Company Acquisition

–

Acquired for cash on March 31, 2009

–

Only locally owned trust company in the Mahoning Valley

–

Rebranded to Farmers Trust Company

–

Trust assets increased approximately 84% since acquisition

–

Contributed $5.7 million to non-interest income in 2013

•

National Associates, Inc. Acquisition

–

Acquired on July 1, 2013 from owner for cash and stock

–

A leading independent consultant to retirement plans. Offers

actuarial, plan design, compliance and administrative services

–

Located in Cleveland, Ohio

–

200 retirement plans with assets under administration of $661

million

Acquisitions to Enhance

Fee-Based Revenue

•

Stable Net Interest Margin

–

Low Cost Core Deposit Funding

•

Strong record of profitability

–

127 consecutive quarters of profitability

–

Average ROAA and ROAE from 2009 through 2014 YTD of 0.79% and

8.21%, respectively

o

ROAA impacted by investment into new markets and services such as

private client services

•

Continue to invest in operations to support ongoing growth, yet

maintain a strong balance sheet

*YTD as of 9-30-14

20

Historical Operating Results

3.47

3.53

3.56

3.54

3.58

2.00

2.50

3.00

3.50

4.00

2013 fq3

2013 fq4

2014 fq1

2014 fq2

2014 fq3

Farmers National Banc Corp.

Net Interest Margin (%) (Annualized)

21

•

127 consecutive quarters of profitability

•

Net income per diluted share for three months ended September 30,

2014 was $0.12, an increase of 33% compared to $0.09 for the third

quarter, 2013  

•

Efficiency ratio for the first three quarters in 2014 improved to

69.91%, compared to 77.21% for the same period in 2013

•

Loans increased 5.8% since September 30, 2013

•

Non-performing assets to total assets remain at low levels, 0.67% at

September 30, 2014

Continued Strong Results –

Overview of 3Q 2014

22

Growing and Diverse Revenue Stream

*YTD as of 9-30-14

•

Continued Focus on Growing Noninterest Income

•

Non-interest Revenue: 29% of Total Revenue

71.0%

14.1%

12.1%

2.8%

Total Revenue YTD 2014*: $38.1 million

Net Interest Income

Trust Income

Insurance & Investment Income

Other Non-interest Income

23

•

Diverse loan mix

•

No national lending

•

No sub-prime lending

•

Farmers’

practice is to lend

primarily within its market area

•

Less than 2% of loan portfolio is

participations purchased

•

Less than 3% of loan portfolio is

construction loans

Loan Portfolio Mix -

September 30, 2014

Overview of Loan Portfolio

Note: Dollars in thousands

Commercial Real

Estate

$203,376

31.4%

Residential Real

Estate

$173,758

26.9%

Consumer

$138,476

21.4%

Commercial &

Industrial

$115,102

17.8%

Commercial

Construction

$11,096

1.7%

Residential

Construction

$5,173

0.8%

24

Excellent Asset Quality

Note: Dollars in millions; Asset quality ratios exclude troubled

debt restructuring

9/30/2014

Nonaccrual loans

$7.0

Accruing loans past due 90 days or more

0.3

OREO

0.3

Total nonperforming assets (NPAs)

$7.6

Troubled Debt Restructuring (TDR)

$8.4

Loans 30-89 days delinquent

4.9

Gross portfolio loans

647.0

Loans held for sale (HFS)

0.9

Allowance for loan losses (ALL)

7.3

Total Assets

$1,139.7

NPLs & 90 days past due/Gross loans (excl. HFS)

1.12%

NPAs/Total Assets

0.67%

TDR/Gross loans (excl. HFS)

1.30%

30-89 days delinquent/Gross loans (excl. HFS)

0.76%

ALL/NPLs & 90 days past due

101.58%

ALL/Gross loans (excl. HFS)

1.13%

Texas Ratio

6.35%

Nonaccrual Loans by Type

Nonaccrual

$7.0mm

92.1%

Accruing loans

past due 90

days or more

$0.3mm

3.9%

OREO

$0.3mm

3.9%

Owner

Occupied

Commercial

Real Estate

$2.2 mm

Residential

Real Estate

$3.1 mm

Commercial

$1.5 mm

Consumer

$0.2 mm

25

Supplemental Information

26

GAAP to Non-GAAP Reconciliation

Reconciliation

of

Common

Stockholders'

Equity

to

Tangible

Common

Equity

Sept 30,

June 30,

March 31,

Dec 31,

Sept 30,

2014

2014

2014

2013

2013

Stockholders' Equity

$121,401

$121,020

$117,323

$113,007

$112,524

Less Goodwill and other intangibles

9,768

9,960

10,151

10,343

10,546

Tangible Common Equity

$111,633

$111,060

$107,172

$102,664

$101,978

Reconciliation of Total Assets to Tangible Assets

Sept 30,

June 30,

March 31,

Dec 31,

Sept 30,

2014

2014

2014

2013

2013

Total Assets

$1,139,739

$1,133,286

$1,141,000

$1,137,326

$1,148,119

Less Goodwill and other intangibles

9,768

9,960

10,151

10,343

10,546

Tangible Assets

$1,129,971

$1,123,326

$1,130,849

$1,126,983

$1,137,573

Reconciliation of Income Before Taxes to Pre-Tax, Pre-Provision Income

For the Three Months Ended

For the Nine Months

Ended

Sept 30,

June 30,

March 31,

Dec 31,

Sept 30,

Sept 30,

Sept 30,

2014

2014

2014

2013

2013

2014

2013

Income before income taxes

$2,964

$3,071

$2,818

$2,936

$1,755

$8,853

$6,527

Provision for loan losses

425

300

330

525

340

1,055

765

Pre-tax, pre-provision income

$3,389

$3,371

$3,148

$3,461

$2,095

$9,908

$7,292

27

Consolidated Statements of Income

Consolidated Statements of Income

For the Three Months Ended

For the Nine Months Ended

Sept 30,

June 30,

March 31,

Dec 31,

Sept 30,

Sept 30,

Sept 30,

Percent

2014

2014

2014

2013

2013

2014

2013

Change

Total interest income

$10,413

$10,118

$10,063

$10,298

$10,122

$30,594

$30,661

-0.2%

Total interest expense

1,128

1,166

1,207

1,257

1,274

3,501

3,806

-8.0%

Net interest income

9,285

8,952

8,856

9,041

8,848

27,093

26,855

0.9%

Provision for loan losses

425

300

330

525

340

1,055

765

37.9%

Other income

3,880

3,797

3,433

3,641

4,173

11,110

10,273

8.1%

Other expense

9,776

9,378

9,141

9,221

10,926

28,295

29,836

-5.2%

Income before income taxes

2,964

3,071

2,818

2,936

1,755

8,853

6,527

35.6%

Income taxes

688

720

627

641

143

2,035

1,042

95.3%

Net income

$2,276

$2,351

$2,191

$2,295

$1,612

$6,818

$5,485

24.3%

28

Consolidated Statements of

Financial Condition

Consolidated Statements of Financial Condition

Sept 30,

June 30,

March 31,

Dec 31,

Sept 30,

2014

2014

2014

2013

2013

Assets

Cash and cash equivalents

$28,294

$28,070

$29,333

$27,513

$40,303

Securities available for sale

404,895

409,285

427,625

422,985

438,127

Loans held for sale

895

275

1,026

158

1,016

Loans

646,981

637,774

626,186

630,684

611,349

Less allowance for loan losses

7,333

7,356

7,387

7,568

7,369

Net Loans

639,648

630,418

618,799

623,116

603,980

Other assets

66,007

65,238

64,217

63,554

64,693

Total Assets

$1,139,739

$1,133,286

$1,141,000

$1,137,326

$1,148,119

Liabilities and Stockholders' Equity

Deposits

$913,000

$907,443

$923,033

$915,216

$903,410

Other interest-bearing liabilities

90,649

93,807

92,815

101,439

118,322

Other liabilities

14,689

11,016

7,829

7,664

13,863

Total liabilities

1,018,338

1,012,266

1,023,677

1,024,319

1,035,595

Stockholders' Equity

121,401

121,020

117,323

113,007

112,524

Total Liabilities

and Stockholders' Equity

$1,139,739

$1,133,286

$1,141,000

$1,137,326

$1,148,119