First National Corporation | research notes

Introducing First National Corporation: A Leading Provider of Value-Driven Financial Solutions

Overview

First National Corporation (FNC) is a diversified financial holding company headquartered in Jackson, Tennessee. Founded in 1990, FNC has grown into a reputable financial institution with a nationwide presence. The company offers a comprehensive suite of financial services tailored to meet the needs of individuals, families, businesses, and organizations.

Core Businesses

• First National Bank and Trust Company: Provides a full range of banking services, including deposit accounts, loans, mortgages, and wealth management.
• First National Advisors: Offers investment advisory services to individuals, families, and businesses.
• First National Insurance Group: Provides insurance solutions through a network of independent agents, including property and casualty insurance, life insurance, and employee benefits.
• First National Mortgage Company: Originates, services, and sells residential and commercial mortgages.

Financial Strength

FNC has consistently maintained a strong financial position. The company boasts robust capital levels, high credit ratings, and a proven track record of profitability. This financial stability allows FNC to provide its customers with confidence and assurance.

Commitment to Value

FNC's mission is to deliver value to its stakeholders. The company focuses on providing exceptional customer service, competitive pricing, and innovative solutions. FNC believes that by creating value for its customers and employees, it will ultimately create value for its shareholders.

Community Involvement

FNC recognizes the importance of giving back to the communities it serves. The company is actively involved in various community initiatives, including financial literacy programs, charitable donations, and volunteerism. FNC believes that by investing in the well-being of its communities, it is investing in its own future.

Recognition and Awards

FNC has received numerous industry accolades over the years, including:

• Best Bank in Tennessee (Memphis Business Journal)
• Top Workplace in Tennessee (Tennessee Chamber of Commerce & Industry)
• Five Star Wealth Manager (Barron's)

Conclusion

First National Corporation is a highly respected and trusted financial institution that offers a wide range of financial solutions. With its unwavering commitment to value, financial strength, and community involvement, FNC is well-positioned to continue serving its customers and stakeholders for years to come. Whether you are seeking banking services, investment advice, insurance solutions, or mortgage financing, First National Corporation has the expertise and resources to meet your needs.

Business Model of First National Corporation

First National Corporation is a diversified financial services holding company that operates through its subsidiaries in the areas of banking, insurance, and wealth management.

Financial Services:

• Banking: First National offers a range of banking products and services, including personal banking, business banking, commercial banking, and mortgage lending.
• Insurance: The company provides life insurance, annuities, and property and casualty insurance through its subsidiaries.
• Wealth Management: First National offers investment management, financial planning, and trust services through its wealth management division.

Advantages to Competitors

First National Corporation has several competitive advantages over its rivals:

• Synergies between businesses: The company's diverse range of financial services allows it to cross-sell products and services to its customers, creating synergies and generating higher revenue.
• Strong regional presence: First National has a strong presence in the Midwest and Northeast regions of the United States, providing it with a loyal customer base and a competitive advantage in its core markets.
• Scale and efficiency: As a large and well-established financial institution, First National benefits from economies of scale and can leverage its size to reduce operating costs and improve profitability.
• Technology investment: The company has invested heavily in technology to enhance its customer service, streamline operations, and reduce risk.
• Conservative risk management: First National has a conservative approach to risk management, which has helped it navigate economic downturns and maintain financial stability.
• Dedicated workforce: The company has a highly trained and experienced workforce committed to providing high-quality service to its customers.
• Brand recognition: First National has a well-known and respected brand in the financial services industry, which gives it an advantage in attracting and retaining customers.

Additionally, First National Corporation has a strong history of financial performance and has consistently paid dividends to its shareholders, further enhancing its competitive position.

Outlook of First National Corporation

Industry Overview:

First National Corporation operates in the highly competitive banking industry, particularly focused on retail and commercial banking in the United States. The industry is characterized by:

• Increasing digitization and technological advancements
• Rising interest rates and inflation
• Stringent regulatory environment
• Consolidation and mergers

Company Overview:

First National Corporation is a diversified financial services provider headquartered in Pennsylvania. The company offers a range of products and services, including:

• Personal and commercial banking services
• Wealth management and investment services
• Insurance services
• Equipment leasing

Financial Performance:

In recent years, First National Corporation has experienced steady financial growth:

• Revenue: Revenue has consistently increased over the past several years, driven by growth in interest income and fee income.
• Net income: Net income has also shown consistent growth, with a slight dip in 2022 due to rising operating expenses and loan loss provisions.
• Return on equity (ROE): The company's ROE has remained healthy, indicating strong profitability.

Market Position:

First National Corporation holds a strong market position in its core markets, with a significant deposit base and a large customer base. The company has a reputation for providing high-quality customer service and innovative products.

Growth Strategies:

First National Corporation has outlined several key growth strategies:

• Expand digital capabilities to enhance customer convenience and reduce costs.
• Focus on wealth management and investment services to cater to the growing needs of affluent customers.
• Acquire smaller financial institutions to increase market share.
• Explore strategic partnerships to enhance product offerings and reach new customers.

Challenges:

First National Corporation faces a number of challenges, including:

• Intense competition in the banking industry
• Rising regulatory costs and compliance requirements
• Increasingly volatile economic conditions
• Interest rate risk

Outlook:

The outlook for First National Corporation is generally positive:

• The expected rise in interest rates should benefit the company's net interest margin.
• Growing demand for financial services, especially in the areas of wealth management and digital banking, is expected to drive revenue growth.
• The company's strong financial position and experienced management team provide a solid foundation for future success.

Recommendation:

Based on the company's financial performance, market position, growth strategies, and overall outlook, First National Corporation may be considered a promising investment opportunity for investors seeking exposure to the banking sector. However, investors should conduct thorough due diligence and consider their own risk tolerance and investment goals before making any investment decisions.

Similar Companies to First National Corporation:

1. Comerica Bank

• Website: https://www.comerica.com/
• Why customers like it: Offers a wide range of banking services, including personal, business, and wealth management accounts. Known for its strong customer service and mobile banking platform.

2. PNC Bank

• Website: https://www.pnc.com/
• Why customers like it: Provides a diverse portfolio of financial products, such as checking and savings accounts, loans, and investments. Features convenient online and mobile banking services.

3. Zions Bank

• Website: https://www.zionsbank.com/
• Why customers like it: A regional bank known for its personal touch and community involvement. Offers various banking solutions, including mortgage lending, business services, and treasury management.

4. Fifth Third Bank

• Website: https://www.53.com/
• Why customers like it: A leading Midwest bank with a strong focus on customer satisfaction. Provides personalized banking services and account management tools.

5. KeyBank

• Website: https://www.key.com/
• Why customers like it: Offers a comprehensive suite of financial services, including personal banking, investments, and business financing. Known for its advanced digital banking capabilities.

6. Wells Fargo

• Website: https://www.wellsfargo.com/
• Why customers like it: One of the largest banks in the United States, providing a full range of banking and financial services. Features a vast network of branches and ATMs.

7. Bank of America

• Website: https://www.bankofamerica.com/
• Why customers like it: A major financial institution offering personal, business, and investment services. Known for its extensive online and mobile banking tools.

8. Chase Bank

• Website: https://www.chase.com/
• Why customers like it: One of the largest banks in the country, providing a wide range of financial products and services. Features convenient banking centers and mobile app.

First National Corporation

Origins:

• Founded in 1863 as First National Bank of Pittsburgh, Pennsylvania.
• One of the first national banks chartered under the National Bank Act of 1863.
• Initially focused on commercial banking and lending to local businesses.

Expansion and Acquisitions:

• Expanded beyond Pittsburgh in the early 20th century, acquiring other banks in Pennsylvania and surrounding states.
• In 1962, changed its name to First National Corporation to reflect its growing operations.
• Made numerous acquisitions throughout the 1960s and 1970s, including banks in New York, Florida, and California.

Diversification and Growth:

• In the 1980s, the company began to diversify its business beyond banking, entering insurance, securities brokerage, and real estate development.
• Acquired banks in the Midwest and South, becoming one of the largest regional banks in the United States.
• In 1989, formed PNC Financial Services Group as a holding company for its various subsidiaries.

Challenges and Consolidation:

• Faced financial difficulties during the banking crisis of the late 1990s and early 2000s.
• In 2000, PNC acquired National City Corporation, another large regional bank.
• Continued to consolidate its operations and reduce expenses in the following years.

Recent Developments:

• In 2016, PNC rebranded itself as PNC Bank, National Association.
• Continued to expand its digital banking capabilities and invest in technology.
• Acquired BBVA USA in 2021, further strengthening its presence in the South and West.

Today:

• Headquartered in Pittsburgh, Pennsylvania.
• One of the largest banks in the United States, with over $550 billion in assets.
• Offers a wide range of financial services, including banking, lending, investments, and insurance.
• Committed to community involvement and financial inclusion.

2022

• January: First National Corporation announced the acquisition of First American Bank, a bank holding company headquartered in Oakbrook Terrace, Illinois.
• March: The company reported a 15% increase in net income for the fourth quarter of 2021.
• June: First National Corporation was named the "2022 Bank of the Year" by Bank Director magazine.
• September: The company announced plans to open a new branch in Raleigh, North Carolina.
• December: First National Corporation reported a 10% increase in net income for the third quarter of 2022.

2023

• January: The company announced the appointment of a new CEO, Rick Wilbanks.
• March: First National Corporation reported a 12% increase in net income for the fourth quarter of 2022.
• June: The company was recognized as one of the "Best Banks to Work For" by American Banker magazine.
• September: First National Corporation announced a new partnership with fintech company Plaid.

2024

• January: The company announced plans to launch a new digital banking platform.
• March: First National Corporation reported a 14% increase in net income for the fourth quarter of 2023.
• June: The company was ranked among the "Top 100 Banks in the United States" by S&P Global Market Intelligence.
• September: First National Corporation announced the acquisition of a regional bank in the Midwest.

Five-Star Service with First National Corporation

As a long-standing client of First National Corporation, I am delighted to share my exceptional experience with this esteemed organization. First National has consistently exceeded my expectations, providing unparalleled service and support that has made all the difference in my financial journey.

Exceptional Service:

From the moment I became a client, I was impressed by the impeccable service I received. My dedicated financial advisor, Ms. Emily Carter, went above and beyond to understand my unique needs and goals. She patiently explained complex financial concepts, answered all my questions, and tailored a customized plan that perfectly aligned with my aspirations.

Personalized Solutions:

First National's commitment to personalized solutions is unparalleled. They recognized that every client's financial situation is different and worked closely with me to develop a strategy that would help me achieve my specific goals. Their extensive array of financial products and services allowed me to create an optimal portfolio that balanced risk and reward.

Investment Excellence:

The investment management team at First National has consistently exceeded industry benchmarks. Their deep market knowledge, innovative strategies, and rigorous risk management protocols have resulted in impressive returns over the years. I trust them implicitly to manage my investments and guide me towards financial success.

Unwavering Support:

Throughout my time with First National, I have always felt supported and informed. Their team is highly responsive, providing prompt assistance and regular updates on my account. They proactively reach out to ensure that I am satisfied with their services and that my goals are still being met.

Exceptional Value:

While financial services can come at a cost, I believe that the value I have received from First National far outweighs the fees. Their expertise, personalized advice, and investment excellence have more than paid for themselves. I am confident that I have made the right investment by choosing First National as my financial partner.

In conclusion, I highly recommend First National Corporation to anyone seeking exceptional financial services. Their commitment to excellence, personalized solutions, and unwavering support have made all the difference in my financial journey. I am grateful for their exceptional service and would not hesitate to entrust them with my finances again.

Unlock Financial Freedom with First National Corporation

www.fnc.com

Are you ready to take control of your financial future? Look no further than First National Corporation, the leading provider of financial services that empower individuals and businesses alike. Our comprehensive suite of solutions is designed to help you achieve your financial goals, no matter how ambitious they may seem.

Empowering Individuals

First National Corporation understands the unique financial needs of individuals. We offer a vast range of products and services tailored to your specific circumstances, including:

• Banking: Convenient checking and savings accounts, competitive loan rates, and world-class online and mobile banking.
• Investments: Expert investment advice, tailored portfolios, and access to a wide range of securities.
• Insurance: Comprehensive solutions to protect you and your family against unforeseen events.

Supporting Businesses

For businesses of all sizes, First National Corporation provides the financial tools and expertise to succeed. Our services include:

• Commercial Banking: Customized loan solutions, cash management services, and streamlined payment processing.
• Equipment Leasing: Flexible lease options to help you acquire the equipment your business needs.
• Business Insurance: Coverage tailored to protect your assets, employees, and reputation.

Why Choose First National Corporation?

• Financial Stability: As a federally regulated financial institution, we maintain the highest standards of financial security and integrity.
• Personalized Service: Our dedicated team of financial professionals provides personalized advice and tailored solutions.
• Innovative Technology: We embrace cutting-edge technology to provide seamless and convenient banking experiences.
• Community Involvement: First National Corporation is deeply committed to supporting our local communities through charitable donations and volunteerism.

Unlock Your Financial Potential

Visit our website www.fnc.com today and discover the transformative power of First National Corporation. Let us empower you to achieve your financial goals and create a secure financial future for yourself and your loved ones.

First National Corporation: Your Trusted Financial Partner

Main Suppliers of First National Corporation:

1. Fiserv, Inc.

• Website: https://www.fiserv.com/
• Services: Core banking platform, payment processing, financial data analytics, risk management, and wealth management solutions

2. Jack Henry & Associates, Inc.

• Website: https://www.jackhenry.com/
• Services: Core banking platform, digital banking, payment processing, and lending solutions

3. Fidelity National Information Services, Inc. (FIS)

• Website: https://www.fisglobal.com/
• Services: Core banking platform, payment processing, capital markets, and investment services

4. Broadridge Financial Solutions, Inc.

• Website: https://www.broadridge.com/
• Services: Investor communications, proxy voting, and data analytics

5. Mastercard Incorporated

• Website: https://www.mastercard.com/
• Services: Payment processing, credit and debit cards, and fraud detection

6. LexisNexis Risk Solutions

• Website: https://www.lexisnexis.com/risk/
• Services: Data analytics, fraud prevention, and identity verification

7. CoreLogic, Inc.

• Website: https://www.corelogic.com/
• Services: Property data and analytics, including flood risk assessment

8. Computershare Limited

• Website: https://www.computershare.com/
• Services: Shareholder services, including stock transfer, dividend payments, and proxy voting

9. NCR Corporation

• Website: https://www.ncr.com/
• Services: ATM manufacturing, retail technology, and hospitality solutions

10. Diebold Nixdorf, Incorporated

• Website: https://www.dieboldnixdorf.com/
• Services: ATM manufacturing, cash handling equipment, and self-service kiosks

Main Customers of First National Corporation

First National Corporation is a financial holding company that provides a range of financial services to individuals and businesses. The company's main customers include:

• Consumers: Individuals who use the company's banking, lending, and investment services.
• Businesses: Small businesses, mid-sized businesses, and large corporations that use the company's commercial banking, lending, and treasury management services.
• Government entities: Federal, state, and local government agencies that use the company's banking, lending, and investment services.
• Non-profit organizations: Non-profit organizations that use the company's banking, lending, and investment services.

Major Downstream Companies

First National Corporation's downstream companies include:

• First National Bank: A full-service bank that provides a range of banking products and services to consumers and businesses.
• First National Capital Markets: An investment banking and brokerage firm that provides a range of investment services to individuals and institutions.
• First National Insurance: An insurance company that provides a range of insurance products and services to individuals and businesses.
• First National Trust Company: A trust company that provides a range of trust and estate planning services to individuals and families.

Websites

The websites of First National Corporation and its downstream companies are as follows:

• First National Corporation: https://www.firstnationalcorporation.com
• First National Bank: https://www.firstnational.com
• First National Capital Markets: https://www.fncmarkets.com
• First National Insurance: https://www.firstnationalinsurance.com
• First National Trust Company: https://www.firstnationaltrust.com

Key Revenue Streams of First National Corporation

First National Corporation, also known as First National Bank of Omaha (FNBO), is a diversified financial services company headquartered in Omaha, Nebraska. The company offers a range of financial products and services through its community banking, equipment finance, and insurance divisions. Its key revenue streams include:

1. Net Interest Income

• Estimated Annual Revenue: $1.2 billion

Net interest income represents the interest earned on loans and other interest-bearing assets minus the interest paid on deposits and borrowings. It is First National Corporation's primary source of revenue and accounts for approximately 60% of its total revenue.

2. Non-Interest Income

• Estimated Annual Revenue: $800 million

Non-interest income includes various fees and charges generated from financial services such as:

• Mortgage origination and servicing fees
• Wealth management fees
• Insurance premiums
• Credit card fees
• Data processing fees

3. Equipment Finance Revenue

• Estimated Annual Revenue: $200 million

First National Corporation's equipment finance division provides loans and leases to businesses for the acquisition of equipment. Revenue from this division includes interest income on loans, lease payments, and origination fees.

4. Insurance Revenue

• Estimated Annual Revenue: $100 million

The company's insurance division offers a range of property and casualty insurance products. Revenue from this division includes premiums paid by policyholders.

5. Other Fee Income

• Estimated Annual Revenue: $80 million

Other fee income includes income from various sources such as:

• Service charges
• Transaction fees
• Consulting and advisory fees

Total Estimated Annual Revenue: $2.4 billion

Note: These are estimated annual revenue figures based on the company's financial statements and industry analysis. Actual revenue may vary slightly from these estimates.

Key Partners of First National Corporation

First National Corporation is a bank holding company headquartered in San Francisco, California. It is the parent company of First National Bank of Northern California, which has been in business since 1870. First National Corporation has a network of branches and ATMs throughout California.

The following is a list of some of First National Corporation's key partners:

• Visa - Visa is a global payment technology company that provides credit, debit, and prepaid cards to consumers and businesses. First National Bank of Northern California issues Visa cards to its customers.
• Mastercard - Mastercard is a global payment technology company that provides credit, debit, and prepaid cards to consumers and businesses. First National Bank of Northern California issues Mastercard cards to its customers.
• American Express - American Express is a global payment technology company that provides credit, debit, and prepaid cards to consumers and businesses. First National Bank of Northern California issues American Express cards to its customers.
• Discover - Discover is a global payment technology company that provides credit, debit, and prepaid cards to consumers and businesses. First National Bank of Northern California issues Discover cards to its customers.
• Zelle - Zelle is a peer-to-peer payment service that allows users to send and receive money instantly. First National Bank of Northern California offers Zelle to its customers.
• PayPal - PayPal is an online payment service that allows users to send and receive money online. First National Bank of Northern California offers PayPal to its customers.
• Venmo - Venmo is a mobile payment service that allows users to send and receive money using their smartphones. First National Bank of Northern California offers Venmo to its customers.
• Cashapp - Cashapp is a mobile payment service that allows users to send and receive money using their smartphones. First National Bank of Northern California offers Cashapp to its customers.

These partnerships allow First National Corporation to offer a wide range of products and services to its customers. They also help First National Corporation to compete with larger banks and credit unions.

Key Cost Structure of First National Corporation

First National Corporation (FNC) is a publicly traded financial services company headquartered in Pittsburgh, Pennsylvania. It is one of the largest bank holding companies in the United States, with approximately $180 billion in assets as of December 31, 2022.

FNC's key cost structure consists of the following components:

1. Interest Expense

FNC's largest expense is interest expense, which is the cost of borrowing money from depositors and other lenders. Interest expense is affected by the level of interest rates, the amount of deposits and borrowings, and the mix of short-term and long-term debt.

Estimated annual cost: $6.0 billion

2. Salaries and Benefits

FNC's second largest expense is salaries and benefits, which includes compensation and benefits for employees. This expense is affected by the number of employees, their salaries and wages, and the cost of benefits such as health insurance and retirement plans.

Estimated annual cost: $3.5 billion

3. Occupancy and Equipment

FNC's occupancy and equipment expense includes the costs of rent, utilities, depreciation, and maintenance for its physical facilities and equipment. This expense is affected by the size and location of FNC's facilities and the cost of maintaining its equipment.

Estimated annual cost: $1.5 billion

4. Marketing and Advertising

FNC's marketing and advertising expense includes the costs of promoting its products and services to potential customers. This expense is affected by the level of competition in the financial services industry and the need to maintain brand awareness.

Estimated annual cost: $1.0 billion

5. Technology and Information Systems

FNC's technology and information systems expense includes the costs of developing and maintaining its technology infrastructure, including its core banking system, online banking platform, and mobile banking apps. This expense is affected by the need to keep pace with technological advancements and the cost of cybersecurity.

Estimated annual cost: $0.8 billion

6. Other Expenses

FNC's other expenses include a variety of costs, such as professional fees, insurance, and regulatory compliance costs.

Estimated annual cost: $0.5 billion

Total Estimated Annual Cost:

Based on the estimated annual costs for each component, FNC's total key cost structure is approximately $13.3 billion.

It's important to note that these cost estimates are based on publicly available information and may vary from FNC's actual reported costs.

Sales Channels

First National Corporation is a diversified financial services company with operations in the United States, Canada, and Europe. The company's primary sales channels include:

• Banking: First National Corporation provides a range of banking products and services to consumers, businesses, and institutions. These products and services include checking and savings accounts, loans, credit cards, and investment products.
• Insurance: First National Corporation offers a variety of insurance products and services, including life insurance, health insurance, and property and casualty insurance.
• Investment management: First National Corporation provides investment management services to individuals and institutions. These services include portfolio management, financial planning, and trust services.
• Brokerage: First National Corporation offers brokerage services to individuals and institutions. These services include buying and selling stocks, bonds, and other financial instruments.
• Other: First National Corporation also generates revenue from other sources, such as data processing and technology services.

Estimated Annual Sales

First National Corporation does not publicly disclose its sales figures for each sales channel. However, the company's total annual sales can be estimated based on its financial statements. In 2022, First National Corporation reported total revenue of $21.8 billion. This revenue was generated from the following sources:

• Net interest income: $10.2 billion
• Non-interest income: $11.6 billion

Non-interest income includes revenue from the company's insurance, investment management, brokerage, and other businesses. Based on this information, it is estimated that First National Corporation's annual sales from its non-banking businesses are approximately $11.6 billion.

Customer Segments of First National Corporation

First National Corporation, a financial services company based in Pittsburgh, Pennsylvania, serves a diverse range of客户群, 包括：

1. Individuals

• Retail Banking: Individuals and families seeking checking and savings accounts, loans, and other financial services. (Estimated annual sales: $1.5 billion)
• Wealth Management: High-net-worth individuals and families seeking investment management, financial planning, and trust services. (Estimated annual sales: $1 billion)

2. Businesses

• Commercial Banking: Businesses of all sizes seeking loans, cash management, and other financial services. (Estimated annual sales: $2.5 billion)
• Corporate & Investment Banking: Large corporations and institutional investors seeking capital markets, mergers and acquisitions, and other financial services. (Estimated annual sales: $2 billion)

3. Non-Profit Organizations

• Non-Profit Banking: Non-profit organizations seeking checking and savings accounts, loans, and other financial services. (Estimated annual sales: $500 million)

4. Public Sector

• Public Sector Banking: Government entities seeking financial services such as investment management, debt issuance, and other financial services. (Estimated annual sales: $250 million)

5. Other

• Other Customers: Includes correspondent banks, brokers, and other parties who provide or receive financial services from First National Corporation. (Estimated annual sales: $150 million)

Total Estimated Annual Sales: $7.9 billion

Note: These are estimated annual sales based on publicly available information and industry data. Actual sales may vary.

First National Corporation: Value Proposition

Target Audience:

• Individuals and families寻求金融服务

Value Proposition:

First National Corporation offers a comprehensive suite of financial products and services designed to meet the diverse needs of its target audience. The company's value proposition encompasses:

1. Personalized Financial Advice:

• Dedicated financial advisors provide tailored guidance and support to help clients achieve their financial goals.
• Personalized financial plans are created based on individual circumstances and objectives.

2. Comprehensive Product Offerings:

• Checking and savings accounts with competitive rates and convenient access.
• Loans (e.g., mortgages, auto loans, personal loans) with flexible terms and competitive interest rates.
• Investment services (e.g., mutual funds, brokerage accounts) to help clients build and manage wealth.

3. Convenient Banking Experience:

• Extensive branch network for in-person interactions and transactions.
• Advanced online and mobile banking platforms for remote account management, bill pay, and other transactions.
• 24/7 customer support via telephone and online channels.

4. Strong Financial Performance and Stability:

• Solid financial foundation with a long history of profitability and growth.
• Highly rated by independent credit rating agencies, indicating financial strength and stability.

5. Community Involvement:

• Active involvement in local communities through philanthropy and volunteerism.
• Supported by a team of knowledgeable and experienced professionals.
• Committed to providing exceptional customer service and empowering clients to make informed financial decisions.

Benefits to Customers:

• Access to a wide range of financial products and services to meet specific needs.
• Personalized guidance and support from experienced financial advisors.
• Convenient and secure banking experience through multiple channels.
• Confidence in a financially stable and reputable institution.
• Positive contributions to local communities.

Credit Risk

First National Corporation's (FNC) credit risk is primarily driven by its exposure to non-performing loans and other credit-impaired assets. As of June 30, 2023, FNC's non-performing loans and other credit-impaired assets represented approximately 3% of its total loans and leases. The company's credit risk is also influenced by the economic conditions in the markets it serves and the overall health of its borrowers.

Market Risk

FNC's market risk is primarily driven by fluctuations in interest rates and changes in the value of its investment portfolio. The company's net interest margin is sensitive to changes in interest rates, and an increase in interest rates could reduce FNC's net interest margin and profitability. Additionally, the value of FNC's investment portfolio could decline in a rising interest rate environment.

Operational Risk

FNC's operational risk includes the risk of fraud, errors, and system failures. The company's internal controls and risk management practices are designed to mitigate these risks, but there is always the potential for operational disruptions. Additionally, FNC is subject to regulatory compliance requirements, and failure to comply with these requirements could result in fines or other penalties.

Liquidity Risk

FNC's liquidity risk is the risk that it will not be able to meet its financial obligations as they become due. The company's liquidity risk is primarily managed through its funding sources, which include deposits, borrowings, and other available liquidity. FNC's funding sources are generally stable, but there is always the potential for disruptions in the financial markets that could affect the company's ability to access funding.

Overall Risk Assessment

Overall, FNC's risk profile is considered to be moderate. The company has a strong track record of profitability and financial stability, and its credit risk, market risk, operational risk, and liquidity risk are all managed through a comprehensive risk management framework. However, there are always potential risks that could affect FNC's financial performance, and investors should be aware of these risks before making any investment decisions.