Citizens & Northern (CZNC) 8-K C&N Announces THIRD QUARTER 2013 UNAUDITED Financial RESULTS

EXHIBIT 99.3 – Supplemental, Unaudited Financial Information

AVAILABLE-FOR-SALE SECURITIES

(In Thousands)

	September 30, 2013				June 30, 2013				December 31, 2012
	Amortized		Fair		Amortized		Fair		Amortized		Fair
	Cost		Value		Cost		Value		Cost		Value
Obligations of U.S. Government agencies	$	47,445	$	46,384	$	49,016	$	47,970	$	30,695	$	31,217
Obligations of states and political subdivisions:
Tax-exempt		129,884		131,096		132,525		134,483		130,168		137,020
Taxable		31,582		31,211		29,976		29,689		24,426		24,817
Mortgage-backed securities		80,190		82,354		63,776		65,625		76,368		80,196
Collateralized mortgage obligations,
Issued by U.S. Government agencies		176,208		175,078		183,792		182,924		179,770		183,510
Trust preferred securities issued by individual institutions		0		0		0		0		5,167		5,171
Collateralized debt obligations:
Pooled trust preferred securities - senior tranches		0		0		0		0		1,615		1,613
Other collateralized debt obligations		660		660		660		660		660		660
Total debt securities		465,969		466,783		459,745		461,351		448,869		464,204
Marketable equity securities		5,802		8,867		5,965		8,717		5,912		8,373
Total	$	471,771	$	475,650	$	465,710	$	470,068	$	454,781	$	472,577

Summary of Loans by Type

(Excludes Loans Held for Sale) 

 (In Thousands)

	Sept. 30,			June 30,			Dec. 31,			Sept. 30,
	2013			2013			2012			2012
Residential mortgage:
Residential mortgage loans - first liens	$	301,794		$	304,806		$	311,627		$	317,734
Residential mortgage loans - junior liens		24,079			24,797			26,748			27,084
Home equity lines of credit		34,360			33,076			33,017			32,550
1-4 Family residential construction		15,746			14,895			12,842			13,038
Total residential mortgage		375,979			377,574			384,234			390,406
Commercial:
Commercial loans secured by real estate		151,602			155,168			158,413			163,773
Commercial and industrial		44,312			45,812			48,442			49,405
Political subdivisions		13,905			24,033			31,789			35,549
Commercial construction and land		21,630			20,189			28,200			27,307
Loans secured by farmland		10,711			11,134			11,403			10,328
Multi-family (5 or more) residential		5,994			6,397			6,745			6,109
Agricultural loans		3,085			3,061			3,053			3,181
Other commercial loans		9,858			543			362			329
Total commercial		261,097			266,337			288,407			295,981
Consumer		11,399			11,059			11,269			11,762
Total		648,475			654,970			683,910			698,149
Less: allowance for loan losses		(7,130	)		(7,198	)		(6,857	)		(7,792	)
Loans, net	$	641,345		$	647,772		$	677,053		$	690,357

Loans Held for Sale

(In Thousands)

	Sept. 30,			June 30,			Dec. 31,			Sept. 30,
	2013			2013			2012			2012
Residential mortgage loans originated and serviced - outstanding balance	$	138,875		$	127,214		$	103,176		$	87,051
Less: outstanding balance of loans sold		(138,074	)		(126,489	)		(100,631	)		(83,205	)
Loans held for sale, net	$	801		$	725		$	2,545		$	3,846

ANALYSIS OF THE ALLOWANCE FOR LOAN LOSSES

(In Thousands)

	3 Months			3 Months			9 Months			9 Months
	Ended			Ended			Ended			Ended
	Sept. 30,			June 30,			Sept. 30,			Sept. 30,
	2013			2013			2013			2012
Balance, beginning of period	$	7,198		$	7,118		$	6,857		$	7,705
Charge-offs		(374	)		(52	)		(619	)		(404	)
Recoveries		67			66			404			70
Net (charge-offs) recoveries		(307	)		14			(215	)		(334	)
Provision for loan losses		239			66			488			421
Balance, end of period	$	7,130		$	7,198		$	7,130		$	7,792

PAST DUE AND IMPAIRED LOANS, NONPERFORMING ASSETS

AND TROUBLED DEBT RESTRUCTURINGS (TDRs)

(In Thousands)

	Sept. 30,			June 30,			Dec 31,			Sept. 30,
	2013			2013			2012			2012
Impaired loans with a valuation allowance	$	4,553		$	1,874		$	2,710		$	4,119
Impaired loans without a valuation allowance		5,703			5,097			4,719			3,718
Total impaired loans	$	10,256		$	6,971		$	7,429		$	7,837
Total loans past due 30-89 days and still accruing	$	7,260		$	6,114		$	7,756		$	6,001
Nonperforming assets:
Total nonaccrual loans	$	6,760		$	6,697		$	7,353		$	7,269
Total loans past due 90 days or more and still accruing		2,668			2,202			2,311			2,260
Total nonperforming loans		9,428			8,899			9,664			9,529
Foreclosed assets held for sale (real estate)		776			890			879			839
Total nonperforming assets	$	10,204		$	9,789		$	10,543		$	10,368
Loans subject to troubled debt restructurings (TDRs):
Performing	$	1,720		$	2,187		$	906		$	916
Nonperforming		1,366			1,154			1,155			1,753
Total TDRs	$	3,086		$	3,341		$	2,061		$	2,669
Total nonperforming loans as a % of loans		1.45	%		1.36	%		1.41	%		1.36	%
Total nonperforming assets as a % of assets		0.83	%		0.80	%		0.82	%		0.79	%
Allowance for loan losses as a % of total loans		1.10	%		1.10	%		1.00	%		1.12	%
Allowance for loan losses as a % of nonperforming loans		75.63	%		80.89	%		70.95	%		81.77	%

Analysis of Average Daily Balances and Rates

(Dollars in Thousands)

	3 Months						3 Months						3 Months
	Ended			Rate of			Ended			Rate of			Ended			Rate of
	9/30/2013			Return/			6/30/2013			Return/			9/30/2012			Return/
	Average			Cost of			Average			Cost of			Average			Cost of
	Balance			Funds %			Balance			Funds %			Balance			Funds %
EARNING ASSETS
Available-for-sale securities,
at amortized cost:
Taxable	$	335,439			2.04	%	$	323,248			2.14	%	$	339,639			2.46	%
Tax-exempt		130,831			5.48	%		132,198			5.76	%		135,362			5.69	%
Total available-for-sale securities		466,270			3.00	%		455,446			3.19	%		475,001			3.38	%
Interest-bearing due from banks		24,795			0.40	%		23,044			0.40	%		33,929			0.36	%
Federal funds sold		0			0.00	%		3			0.00	%		0			0.00	%
Loans held for sale		1,032			5.38	%		787			6.12	%		4,293			3.89	%
Loans receivable:
Taxable		615,318			5.64	%		625,215			5.79	%		662,374			6.00	%
Tax-exempt		34,712			5.87	%		33,690			5.88	%		37,696			6.32	%
Total loans receivable		650,030			5.65	%		658,905			5.80	%		700,070			6.02	%
Total Earning Assets		1,142,127			4.46	%		1,138,185			4.64	%		1,213,293			4.82	%
Cash		17,698						16,961						17,466
Unrealized gain/loss on securities		1,688						13,820						19,310
Allowance for loan losses		(7,258	)					(7,229	)					(7,727	)
Bank premises and equipment		17,950						18,351						19,106
Intangible Asset - Core Deposit Intangible		105						120						165
Intangible Asset - Goodwill		11,942						11,942						11,942
Other assets		43,690						43,127						46,102
Total Assets	$	1,227,942					$	1,235,277					$	1,319,657
INTEREST-BEARING LIABILITIES
Interest-bearing deposits:
Interest checking	$	172,010			0.12	%	$	167,404			0.12	%	$	166,961			0.12	%
Money market		205,168			0.14	%		204,444			0.15	%		210,269			0.16	%
Savings		116,474			0.10	%		117,224			0.10	%		110,133			0.10	%
Certificates of deposit		144,689			0.99	%		150,358			1.00	%		199,250			1.47	%
Individual Retirement Accounts		127,526			0.40	%		130,368			0.44	%		141,421			0.73	%
Other time deposits		1,556			0.25	%		1,161			0.00	%		1,768			0.00	%
Total interest-bearing deposits		767,423			0.33	%		770,959			0.35	%		829,802			0.56	%
Borrowed funds:
Short-term		7,944			0.15	%		5,684			0.14	%		5,369			0.15	%
Long-term		73,436			4.03	%		73,615			4.03	%		105,811			4.02	%
Total borrowed funds		81,380			3.65	%		79,299			3.75	%		111,180			3.83	%
Total Interest-bearing Liabilities		848,803			0.65	%		850,258			0.67	%		940,982			0.94	%
Demand deposits		191,393						193,115						191,301
Other liabilities		10,030						8,292						8,967
Total Liabilities		1,050,226						1,051,665						1,141,250
Stockholders' equity, excludingother comprehensive income/loss		176,772						174,782						166,318
Other comprehensive income/loss		944						8,830						12,089
Total Stockholders' Equity		177,716						183,612						178,407
Total Liabilities and Stockholders' Equity	$	1,227,942					$	1,235,277					$	1,319,657
Interest Rate Spread					3.81	%					3.97	%					3.88	%
Net Interest Income/Earning Assets					3.97	%					4.15	%					4.09	%
Total Deposits (Interest-bearing and Demand)	$	958,816					$	964,074					$	1,021,103

(1) Changes in income on tax-exempt securities and loans are presented on a fully tax-equivalent basis, using the Corporation’s marginal federal income tax rate of 35%.

(2) Nonaccrual loans have been included with loans for the purpose of analyzing net interest earnings.

Analysis of Average Daily Balances and Rates

(Dollars in Thousands)

	9 Months						9 Months
	Ended			Rate of			Ended			Rate of
	9/30/2013			Return/			9/30/2012			Return/
	Average			Cost of			Average			Cost of
	Balance			Funds %			Balance			Funds %
EARNING ASSETS
Available-for-sale securities, at amortized cost:
Taxable	$	324,839			2.16	%	$	334,652			2.96	%
Tax-exempt		131,053			5.66	%		131,083			5.88	%
Total available-for-sale securities		455,892			3.17	%		465,735			3.79	%
Interest-bearing due from banks		25,808			0.39	%		35,183			0.34	%
Federal funds sold		6			0.00	%		0			0.00	%
Loans held for sale		1,333			4.71	%		2,412			4.10	%
Loans receivable:
Taxable		625,527			5.77	%		665,011			6.15	%
Tax-exempt		35,617			5.85	%		36,756			6.33	%
Total loans receivable		661,144			5.77	%		701,767			6.16	%
Total Earning Assets		1,144,183			4.61	%		1,205,097			5.07	%
Cash		16,919						17,383
Unrealized gain/loss on securities		10,539						18,263
Allowance for loan losses		(7,205	)					(7,634	)
Bank premises and equipment		18,316						18,971
Intangible Asset - Core Deposit Intangible		119						185
Intangible Asset - Goodwill		11,942						11,942
Other assets		43,400						47,140
Total Assets	$	1,238,213					$	1,311,347
INTEREST-BEARING LIABILITIES
Interest-bearing deposits:
Interest checking	$	171,180			0.12	%	$	161,845			0.13	%
Money market		203,925			0.14	%		208,932			0.18	%
Savings		116,745			0.10	%		107,403			0.10	%
Certificates of deposit		151,630			1.06	%		196,840			1.58	%
Individual Retirement Accounts		130,633			0.45	%		143,910			0.87	%
Other time deposits		1,190			0.11	%		1,343			0.10	%
Total interest-bearing deposits		775,303			0.36	%		820,273			0.62	%
Borrowed funds:
Short-term		5,963			0.13	%		6,144			0.13	%
Long-term		76,761			4.02	%		111,552			4.01	%
Total borrowed funds		82,724			3.74	%		117,696			3.80	%
Total Interest-bearing Liabilities		858,027			0.69	%		937,969			1.02	%
Demand deposits		189,823						190,644
Other liabilities		9,070						8,732
Total Liabilities		1,056,920						1,137,345
Stockholders' equity, excludingother comprehensive income/loss		174,726						162,627
Other comprehensive income/loss		6,567						11,375
Total Stockholders' Equity		181,293						174,002
Total Liabilities and Stockholders' Equity	$	1,238,213					$	1,311,347
Interest Rate Spread					3.92	%					4.05	%
Net Interest Income/Earning Assets					4.10	%					4.28	%
Total Deposits (Interest-bearing and Demand)	$	965,126					$	1,010,917

(1) Changes in income on tax-exempt securities and loans are presented on a fully tax-equivalent basis, using the Corporation’s marginal federal income tax rate of 35%.

(2) Nonaccrual loans have been included with loans for the purpose of analyzing net interest earnings.

COMPARISON OF NONINTEREST INCOME

(In Thousands)

	Three Months Ended						Nine Months Ended
	Sept. 30,		June 30,		Sept. 30,		Sept. 30,		Sept. 30,
	2013		2013		2012		2013		2012
Service charges on deposit accounts	$	1,281	$	1,171	$	1,290	$	3,611	$	3,707
Service charges and fees		241		216		239		658		694
Trust and financial management revenue		1,033		1,045		873		3,022		2,762
Brokerage revenue		205		237		197		586		653
Insurance commissions, fees and premiums		32		59		62		136		169
Interchange revenue from debit card transactions		484		505		477		1,453		1,460
Net gains from sales of loans		624		587		625		1,756		1,263
Increase in cash surrender value of life insurance		109		99		111		301		347
Net gain from premises and equipment		14		0		1		14		271
Other operating income		270		272		247		790		730
Total other operating income, before realizedgains on available-for-sale securities, net	$	4,293	$	4,191	$	4,122	$	12,327	$	12,056

COMPARISON OF NONINTEREST EXPENSE

(In Thousands)

	Three Months Ended						Nine Months Ended
	Sept. 30,		June 30,		Sept. 30,		Sept. 30,		Sept. 30,
	2013		2013		2012		2013		2012
Salaries and wages	$	3,536	$	3,635	$	3,594	$	10,771	$	10,755
Pensions and other employee benefits		876		1,034		982		3,165		3,438
Occupancy expense, net		626		599		610		1,859		1,874
Furniture and equipment expense		487		483		475		1,464		1,418
FDIC Assessments		151		147		165		450		468
Pennsylvania shares tax		350		351		339		1,051		1,011
Other operating expense		2,584		2,271		2,061		6,923		5,996
Total noninterest expense, before loss on prepayment of borrowings		8,610		8,520		8,226		25,683		24,960
Loss on prepayment of borrowings		0		0		2,190		1,023		2,333
Total Noninterest Expense	$	8,610	$	8,520	$	10,416	$	26,706	$	27,293