Citizens & Northern (CZNC) 8-K C&N Announces THIRD QUARTER 2014 UNAUDITED Financial RESULTS

EXHIBIT 99.3 – Supplemental, Unaudited Financial Information

AVAILABLE-FOR-SALE SECURITIES	September 30, 2014				June 30, 2014				December 31, 2013
(In Thousands)	Amortized		Fair		Amortized		Fair		Amortized		Fair
	Cost		Value		Cost		Value		Cost		Value
Obligations of U.S. Government agencies	$	27,237	$	26,416	$	29,162	$	28,452	$	47,382	$	45,877
Obligations of states and political subdivisions:
Tax-exempt		123,336		128,292		123,140		127,593		127,748		128,426
Taxable		34,136		34,203		34,577		34,717		35,154		34,471
Mortgage-backed securities		74,278		75,513		91,051		93,613		84,849		86,208
Collateralized mortgage obligations, Issued by U.S. Government agencies		236,940		234,816		219,858		218,506		182,372		178,092
Other collateralized debt obligations		660		660		660		660		660		660
Total debt securities		496,587		499,900		498,448		503,541		478,165		473,734
Marketable equity securities		5,605		8,353		6,122		9,207		6,038		8,924
Total	$	502,192	$	508,253	$	504,570	$	512,748	$	484,203	$	482,658

Summary of Loans by Type
(Excludes Loans Held for Sale)
(In Thousands)	Sept. 30,			June 30,			Dec. 31,			Sept. 30,
	2014			2014			2013			2013
Residential mortgage:
Residential mortgage loans - first liens	$	290,943		$	291,690		$	299,831		$	301,794
Residential mortgage loans - junior liens		21,843			22,401			23,040			24,079
Home equity lines of credit		35,975			34,633			34,530			34,360
1-4 Family residential construction		16,895			13,948			13,909			15,746
Total residential mortgage		365,656			362,672			371,310			375,979
Commercial:
Commercial loans secured by real estate		144,410			145,934			147,215			151,602
Commercial and industrial		50,615			46,778			42,387			44,312
Political subdivisions		14,823			11,617			16,291			13,905
Commercial construction and land		9,069			8,550			17,003			21,630
Loans secured by farmland		8,542			8,380			10,468			10,711
Multi-family (5 or more) residential		9,092			10,548			10,985			5,994
Agricultural loans		3,284			3,116			3,251			3,085
Other commercial loans		13,620			13,816			14,631			9,858
Total commercial		253,455			248,739			262,231			261,097
Consumer		10,298			10,203			10,762			11,399
Total		629,409			621,614			644,303			648,475
Less: allowance for loan losses		(7,449	)		(7,267	)		(8,663	)		(7,130	)
Loans, net	$	621,960		$	614,347		$	635,640		$	641,345

Loans Held for Sale
(In Thousands)	Sept. 30,			June 30,			Dec. 31,			Sept. 30,
	2014			2014			2013			2013
Residential mortgage loans originated and serviced - outstanding balance	$	151,113		$	150,725		$	146,008		$	138,875
Less: outstanding balance of loans sold		(150,695	)		(150,725	)		(145,954	)		(138,074	)
Loans held for sale, net	$	418		$	0		$	54		$	801

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,
	2014			2014			2014			2013
Balance, beginning of period	$	7,267		$	8,343		$	8,663		$	6,857
Charge-offs		(61	)		(1,546	)		(1,881	)		(619	)
Recoveries		25			24			314			404
Net charge-offs		(36	)		(1,522	)		(1,567	)		(215	)
Provision for loan losses		218			446			353			488
Balance, end of period	$	7,449		$	7,267		$	7,449		$	7,130

PAST DUE AND IMPAIRED LOANS, NONPERFORMING ASSETS

AND TROUBLED DEBT RESTRUCTURINGS (TDRs)

(In Thousands)

	Sept. 30,			June 30,			Dec 31,			Sept. 30,
	2014			2014			2013			2013
Impaired loans with a valuation allowance	$	4,059		$	3,804		$	9,889		$	4,553
Impaired loans without a valuation allowance		10,035			10,258			6,432			5,703
Total impaired loans	$	14,094		$	14,062		$	16,321		$	10,256
Total loans past due 30-89 days and still accruing	$	5,458		$	4,837		$	8,305		$	7,260
Nonperforming assets:
Total nonaccrual loans	$	13,722		$	13,598		$	14,934		$	6,760
Total loans past due 90 days or more and still accruing		2,602			3,050			3,131			2,668
Total nonperforming loans		16,324			16,648			18,065			9,428
Foreclosed assets held for sale (real estate)		1,888			1,419			892			776
Total nonperforming assets	$	18,212		$	18,067		$	18,957		$	10,204
Loans subject to troubled debt restructurings (TDRs):
Performing	$	1,834		$	2,069		$	3,267		$	2,160
Nonperforming		6,172			6,038			908			926
Total TDRs	$	8,006		$	8,107		$	4,175		$	3,086
Total nonperforming loans as a % of loans		2.59	%		2.68	%		2.80	%		1.45	%
Total nonperforming assets as a % of assets		1.45	%		1.44	%		1.53	%		0.83	%
Allowance for loan losses as a % of total loans		1.18	%		1.17	%		1.34	%		1.10	%
Allowance for loan losses as a % of nonperforming loans		45.63	%		43.65	%		47.95	%		75.63	%

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
	9/30/2014			Return/			6/30/2014			Return/			9/30/2013			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	$	381,833			2.16	%	$	372,666			2.18	%	$	335,439			2.04	%
Tax-exempt		123,949			5.22	%		123,568			5.35	%		130,831			5.48	%
Total available-for-sale securities		505,782			2.91	%		496,234			2.97	%		466,270			3.00	%
Interest-bearing due from banks		35,133			0.37	%		33,106			0.39	%		24,795			0.40	%
Federal funds sold		0			0.00	%		0			0.00	%		0			0.00	%
Loans held for sale		263			7.54	%		282			7.11	%		1,032			5.38	%
Loans receivable:
Taxable		587,799			5.43	%		585,593			5.54	%		615,318			5.64	%
Tax-exempt		38,537			5.48	%		36,422			5.62	%		34,712			5.87	%
Total loans receivable		626,336			5.43	%		622,015			5.54	%		650,030			5.65	%
Total Earning Assets		1,167,514			4.19	%		1,151,637			4.29	%		1,142,127			4.46	%
Cash		17,361						17,484						17,698
Unrealized gain/loss on securities		7,810						6,539						1,688
Allowance for loan losses		(7,332	)					(8,402	)					(7,258	)
Bank premises and equipment		16,581						16,889						17,950
Intangible Asset - Core Deposit Intangible		64						75						105
Intangible Asset - Goodwill		11,942						11,942						11,942
Other assets		40,201						40,965						43,690
Total Assets	$	1,254,141					$	1,237,129					$	1,227,942
INTEREST-BEARING LIABILITIES
Interest-bearing deposits:
Interest checking	$	186,034			0.12	%	$	179,018			0.12	%	$	172,010			0.12	%
Money market		202,536			0.14	%		198,753			0.15	%		205,168			0.14	%
Savings		123,447			0.10	%		121,741			0.10	%		116,474			0.10	%
Certificates of deposit		137,136			0.76	%		138,250			0.81	%		144,689			0.99	%
Individual Retirement Accounts		120,079			0.40	%		120,987			0.39	%		127,526			0.40	%
Other time deposits		1,525			0.00	%		1,138			0.00	%		1,556			0.25	%
Total interest-bearing deposits		770,757			0.28	%		759,887			0.29	%		767,423			0.33	%
Borrowed funds:
Short-term		5,325			0.07	%		4,766			0.08	%		7,944			0.15	%
Long-term		73,162			4.03	%		73,232			4.03	%		73,436			4.03	%
Total borrowed funds		78,487			3.76	%		77,998			3.79	%		81,380			3.65	%
Total Interest-bearing Liabilities		849,244			0.60	%		837,885			0.62	%		848,803			0.65	%
Demand deposits		208,773						204,664						191,393
Other liabilities		10,975						7,971						10,030
Total Liabilities		1,068,992						1,050,520						1,050,226
Stockholders' equity, excluding other comprehensive income/loss		180,042						182,258						176,772
Other comprehensive income/loss		5,107						4,351						944
Total Stockholders' Equity		185,149						186,609						177,716
Total Liabilities and Stockholders' Equity	$	1,254,141					$	1,237,129					$	1,227,942
Interest Rate Spread					3.59	%					3.67	%					3.81	%
Net Interest Income/Earning Assets					3.75	%					3.84	%					3.97	%
Total Deposits (Interest-bearing and Demand)	$	979,530					$	964,551					$	958,816

(1) Rates of return on tax-exempt securities and loans are presented on a fully taxable-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
	9/30/2014			Return/			9/30/2013			Return/
	Average			Cost of			Average			Cost of
	Balance			Funds %			Balance			Funds %
EARNING ASSETS
Available-for-sale securities, at amortized cost:
Taxable	$	366,853			2.18	%	$	324,839			2.16	%
Tax-exempt		124,508			5.34	%		131,053			5.66	%
Total available-for-sale securities		491,361			2.98	%		455,892			3.17	%
Interest-bearing due from banks		32,798			0.39	%		25,808			0.39	%
Federal funds sold		0			0.00	%		6			0.00	%
Loans held for sale		222			7.83	%		1,333			4.71	%
Loans receivable:
Taxable		589,607			5.47	%		625,527			5.77	%
Tax-exempt		38,203			5.64	%		35,617			5.85	%
Total loans receivable		627,810			5.48	%		661,144			5.77	%
Total Earning Assets		1,152,191			4.27	%		1,144,183			4.61	%
Cash		17,052						16,919
Unrealized gain/loss on securities		5,719						10,539
Allowance for loan losses		(8,166	)					(7,205	)
Bank premises and equipment		16,915						18,316
Intangible Asset - Core Deposit Intangible		74						119
Intangible Asset - Goodwill		11,942						11,942
Other assets		41,156						43,400
Total Assets	$	1,236,883					$	1,238,213
INTEREST-BEARING LIABILITIES
Interest-bearing deposits:
Interest checking	$	181,580			0.12	%	$	171,180			0.12	%
Money market		198,987			0.14	%		203,925			0.14	%
Savings		121,257			0.10	%		116,745			0.10	%
Certificates of deposit		136,748			0.81	%		151,630			1.06	%
Individual Retirement Accounts		121,143			0.39	%		130,633			0.45	%
Other time deposits		1,161			0.00	%		1,190			0.11	%
Total interest-bearing deposits		760,876			0.29	%		775,303			0.36	%
Borrowed funds:
Short-term		6,696			0.14	%		5,963			0.13	%
Long-term		73,231			4.03	%		76,761			4.02	%
Total borrowed funds		79,927			3.71	%		82,724			3.74	%
Total Interest-bearing Liabilities		840,803			0.61	%		858,027			0.69	%
Demand deposits		202,336						189,823
Other liabilities		9,045						9,070
Total Liabilities		1,052,184						1,056,920
Stockholders' equity, excluding  other comprehensive income/loss		180,912						174,726
Other comprehensive income/loss		3,787						6,567
Total Stockholders' Equity		184,699						181,293
Total Liabilities and Stockholders' Equity	$	1,236,883					$	1,238,213
Interest Rate Spread					3.66	%					3.92	%
Net Interest Income/Earning Assets					3.82	%					4.10	%
Total Deposits (Interest-bearing and Demand)	$	963,212					$	965,126

(1) Rates of return on tax-exempt securities and loans are presented on a fully taxable-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,
	2014			2014			2013		2014		2013
Service charges on deposit accounts	$	1,275		$	1,314		$	1,357	$	3,812	$	3,825
Service charges and fees		144			134			165		405		444
Trust and financial management revenue		1,140			1,138			1,033		3,325		3,022
Brokerage revenue		213			242			205		682		586
Insurance commissions, fees and premiums		44			27			32		103		136
Interchange revenue from debit card transactions		504			517			484		1,474		1,453
Net gains from sales of loans		141			265			504		557		1,560
(Decrease) increase in fair value of servicing rights		(17	)		(53	)		79		35		84
Increase in cash surrender value of life insurance		99			91			109		278		301
Net gain (loss) from premises and equipment		9			(1	)		14		8		14
Other operating income		335			306			311		939		902
Total other operating income, before realized gains on available-for-sale securities, net	$	3,887		$	3,980		$	4,293	$	11,618	$	12,327

COMPARISON OF NONINTEREST EXPENSE
(In Thousands)	Three Months Ended						Nine Months Ended
	Sept. 30,		June 30,		Sept. 30,		Sept. 30,		Sept. 30,
	2014		2014		2013		2014		2013
Salaries and wages	$	4,348	$	3,646	$	3,536	$	11,559	$	10,771
Pensions and other employee benefits		1,091		1,153		876		3,563		3,165
Occupancy expense, net		646		641		626		2,002		1,859
Furniture and equipment expense		461		466		487		1,399		1,464
FDIC Assessments		151		146		151		444		450
Pennsylvania shares tax		336		337		350		1,014		1,051
Professional fees		135		144		806		427		1,424
Automated teller machine and interchange expense		239		218		218		668		802
Software subscriptions		184		201		209		575		641
Other operating expense		1,445		1,395		1,351		4,256		4,056
Total noninterest expense, before loss on prepayment of borrowings		9,036		8,347		8,610		25,907		25,683
Loss on prepayment of borrowings		0		0		0		0		1,023
Total noninterest expense	$	9,036	$	8,347	$	8,610	$	25,907	$	26,706