When it comes to midstate-based banks, most of their branches are in Central Pennsylvania.
PeoplesBank of York County has expanded into Baltimore and its suburbs, Fulton Bank has made most of its expansions and acquisitions to the south, and recently some local banks have made moves into Schuylkill County.
But when it comes to Luzerne County, Schuylkill County’s northern neighbor, midstate banks barely make a blip. It’s almost like there is an imaginary boundary line at the Frackville/St. Clair Exit on Interstate 81 that keeps us down here and them up there.
With Mid Penn Bancorp Inc.’s acquisition of Phoenix Bancorp Inc. this week, that could change.
Phoenix is the holding company for Miners Bank of Minersville, and three of its four branches are in Schuylkill County. However, in June 2013, it opened a branch in the Hazleton area, its first in Luzerne County.
If the deal announced Wednesday closes — it’s pending regulatory and shareholder approvals on both sides — that Luzerne County branch will become a Mid Penn branch, the Millersburg-based bank’s first toe-dip into the county.
It might not be the last. Mid Penn President and CEO Rory Ritrievi said he is interested in the Luzerne County and northeast Pennsylvania market because it’s similar to the northern Dauphin County market where Mid Penn is based.
“Would I open a ‘de novo’ bank there? Probably not,” he said of opening a completely new bank in Luzerne County. “But this bank is already there and it’s already strong. There are areas in Luzerne County and (north) that I think are attractive. I’m not saying we’re expanding there, but it’s an extension of our type of market.”
Luzerne County is dominated by national and large regional banks. By deposit market share, according to the Federal Deposit Insurance Corp. statistics from 2012-13, the county is swamped by Pittsburgh-based PNC (23.7 percent), Buffalo-based M&T (15.9 percent), Wells Fargo (10 percent) of San Francisco and Citizens Bank of Pennsylvania (8.8 percent) of Philadelphia. Together, that’s almost 60 percent of the county’s market share.
The closest Luzerne County-based bank is Luzerne Bank at 4.8 percent.
Miners Bank isn’t even included in the most recent Luzerne County statistics, because it didn’t open soon enough to be included.
Mid Penn becomes only the second midstate-based bank to make a move as far north as Luzerne County. Only Susquehanna Bank (2.4 percent market share), based in Lititz, has branches in the Hazleton area. Those three branches came to Susquehanna when it bought Community Banks Inc. in 2007, according to bank spokesman Matthew Kemeney.
Lancaster-based Fulton Financial Corp. has an FNB Bank branch in Berwick, Columbia County, near the southern border of Luzerne County.
Whether Mid Penn moves further into northeast Pennsylvania — NEPA (NEE-pah), for the uninitiated — might not matter. The established local, regional and national banks have flooded Central Pennsylvania, and I’ve quoted a few analysts recently who have mentioned phrases like “low-growth market” and “possible over-saturation.”
It’s not much of a shock, then, that the regional bank merger and acquisition deals going down lately are all deals that involve moving into new markets. Northeast Pennsylvania, however, has not been one of those markets — until now.
If Ritrievi is right, and there are some attractive qualities to northeast Pennsylvania, then perhaps midstate banks might take a longer look north when they’re thinking about expansion.