Note

– Acquisition

June 14, 2019,

the Corporation entered into an Agreement and Plan of Merger with Peoples Bancorp of Mt. Pleasant, Inc. (Peoples) and its wholly owned subsidiary, The Peoples National Bank of Mount Pleasant (Peoples Bank). On

January 1, 2020,

Consumers completed the acquisition by merger of Peoples in a stock and cash transaction for an aggregate consideration of approximately

$10,405.

In connection with the acquisition, the Corporation issued

269,920

shares of common stock and paid

$5,128

in cash to the former shareholders of Peoples. Immediately following the merger, Peoples Bank, was merged into the Corporation's banking subsidiary, Consumers National Bank.

December 31, 2019,

Peoples had approximately

$72,016

in total assets,

$55,273

in loans and

$60,826

in deposits at its

three

banking centers located in Mt. Pleasant, Adena, and Dillonvale, Ohio. The assets and liabilities of Peoples were recorded on the Corporation's Balance Sheet at their estimated fair values as of

January 1, 2020,

the acquisition date, and Peoples' results of operations are included in the Corporation's Consolidated Statements of Income beginning on that date.

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition of Peoples. The core deposit intangible will be amortized over

ten

years on a straight-line basis. Goodwill will

not

be amortized, but instead will be evaluated for impairment.

Consideration Paid				$	10,405
Net assets acquired:
Cash and cash equivalents	$	833
Certificates of deposit in other financial institutions		11,839
Securities, available-for-sale		4,051
Federal bank and other restricted stocks, at cost		154
Loans, net		55,320
Premises and equipment		818
Core deposit intangible		270
Accrued interest receivable and other assets		140
Noninterest-bearing deposits		(11,979	)
Interest-bearing deposits		(48,872	)
Federal funds purchased		(2,348	)
Federal Home Loan Bank advances		(491	)
Other liabilities		(166	)
Total net assets acquired					9,569
Goodwill				$	836

The acquired assets and liabilities were measured at estimated fair values. Management made certain estimates and exercised judgement in accounting for the acquisition. The fair value of loans was estimated using discounted contractual cash flows. The book balance of the loans at the time of the acquisition was

$55,273

before considering Peoples' allowance for loan losses, which was

not

carried over. The fair value disclosed above reflects a credit-related adjustment of $(

890

) and an adjustment for other factors of

$937.

Loans evidencing credit deterioration since origination, purchased credit impaired loans, included in loans receivable, were immaterial. Acquisition costs of

$827

pre-tax, or

$680

after-tax, were recorded during the

twelve

-month period ended

June 30, 2020.

The fair value measurements of assets acquired and liabilities assumed are subject to refinement for up to

one

year after the closing date of the acquisition as additional information relative to closing date fair values becomes available.