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As you have likely seen in the news, it was an eventful weekend as the banking regulators took action to limit the fallout from the Silicon Valley Bank (SVB) and Signature Bank failures. While news like this naturally creates an initial sense of concern, these actions are designed to reinforce confidence in the overall banking system.

Both of these banks operated with unique models – SVB with a concentration in technology and life sciences/healthcare startups and Signature in cryptocurrency. Their profiles have been widely documented and are very different than C&N and other more conventional institutions with diverse customer bases.

The actions taken by the regulators guarantee that SVB and Signature customers’ deposits, insured and uninsured, will remain accessible to them and will also provide for a more orderly liquidation of the banks in the weeks ahead. While FDIC insurance coverage is $250,000, it can be more depending on how accounts are titled and structured. It’s important to note that both of these institutions had very high levels of uninsured deposits. Additionally, the Fed established new borrowing capacity to provide contingent liquidity for all banks by using bond portfolios at par value as collateral.

As the U.S. government is taking these measures to reassure its taxpayers, the C&N Team is taking measures to reinforce the confidence you’ve placed in us as your trusted, hometown bank – a role we take very seriously. For 159 years, C&N has prided itself on being a safe, secure and strong community bank with effective and disciplined risk management practices.

With this recent attention on our industry, we want to address any questions that may linger about any impact on C&N by stressing a few important points:

• C&N has always been a strong, well-capitalized bank with an excellent risk profile.
• We have a diverse funding base that is generated in our local communities and do not rely on a limited number of large depositors, or face funding concentration risk, which is what ultimately resulted in the demise of these two banks over the weekend.
• We maintain a much lower level of uninsured deposits than the banks mentioned above, which means a vast majority of our customers are covered by FDIC insurance. At December 31, 2022, C&N uninsured deposits percentage was 34.2%, significantly lower than the comparative percentages reported by SVB of 86.4% and Signature Bank of 89.7%.
• As part of our risk management practices, C&N has substantial contingent sources of liquidity to support customer needs. We maintain ample sources of liquidity in the form of credit facilities with the Federal Home Loan Bank of Pittsburgh, the Federal Reserve Bank of Philadelphia and other banks, as well as unpledged available-for-sale securities. At December 31, 2022, the unused, available portion of these liquidity facilities totaled an excess of 56.6% over the estimated amount of uninsured deposits.

C&N’s long-standing reputation remains intact, driven by continually solid financial performance, a strong liquidity position and a diversified base of accountholders who entrust our C&N Team every day. We remain confident in our model and in our Team’s ability to be here for our clients well into the future.

We hope you found this information to be helpful. If you have any questions, please do not hesitate to connect with your local C&N office, your Relationship Manager or our Client Care Center at 877.838.2517.

On behalf of the entire C&N team, we’re confident that you’ve made the right decision in choosing us as your financial partner, we’re grateful for your business and we’ll never stop working to prove it to you.

Brad Scovill
President & CEO