Orrstown sells distressed loans
Orrstown Bank has offloaded $45.6 million in distressed loans from its books, the bank's holding company said in a news release late Thursday.
Orrstown Financial Services Inc. said it received $32.1 million from selling the 172 commercial loans to a group of independent investors. Orrstown said it expects to absorb the discount to book value "through existing loan loss reserves."
The sale reduces Orrstown's troubled assets by 42 percent compared with Sept. 30 and more than 60 percent since last December, the Shippensburg-based bank said.
Orrstown is operating under federal and state consent orders mandating that it improve the health of its loan portfolio. The bank announced completion of a similar sale in July, selling private investors a package of 65 loans with a book value of $28.6 million.