FARMERS NATIONAL BANC CORP /OH/ Commitments Disclosure

NOTE 14 – COMMITMENTS AND CONTINGENT LIABILITIES

 

Some financial instruments, such as loan commitments, credit lines, letters of credit and overdraft protection, are issued to meet customer financing needs. These are agreements to provide credit or to support the credit of others, as long as conditions established in the contract are met, and usually have expiration dates. Commitments may expire without being used. Off-balance-sheet risk to credit loss exists up to the face amount of these instruments, although material losses are not anticipated. The same credit policies are used to make such commitments as are used for loans, including obtaining collateral at exercise of the commitment.

 

The contractual amounts of financial instruments with off-balance-sheet risk at year-end were as follows:

 

		2025								2024
		Fixed Rate				Variable Rate				Fixed Rate				Variable Rate
Commitments and unused lines of credit		$	116,899			$	638,358			$	114,603			$	622,379

 

Commitments to make loans are generally made for periods of 30 days or less. Commitments and fixed rate unused lines of credit have interest rates ranging from 2.65% to 21.90% at both  December 31, 2025 and 2024. Commitments and fixed rate unused lines of credit have a maturity range of January 22, 2026 through May 1, 2057 as of December 31, 2025, and January 16, 2025 through May 5, 2056 as of December 31, 2024.

 

Standby letters of credit are considered financial guarantees. The standby letters of credit have a contractual value of $5.5 million at December 31, 2025 and $6.4 million at December 31, 2024. The carrying amount of these items is not material to the balance sheet.

 

Additionally, the Company has committed up to a $20.2 million subscription in SBIC investment funds. At December 31, 2025, the Company had invested $15.5 million in these funds.