Bank earnings up in Q3
Banks across Central Pennsylvania are generally reporting higher profits for the third quarter of 2018, helped by brisk lending activity and falling tax rates.
Here is a run-down based on recent press releases and filings with the U.S. Securities and Exchange Commission.
Franklin Financial Services Corp., the parent of F&M Trust, had net income of $4 million for the third quarter of 2018, up from $3.1 million in the same period in 2017.
However, the bank's profits are off for the year so far, largely due to its losses stemming from a participation loan to bankrupt energy company Worley & Obetz Inc. Its net income for the first nine months of 2018 is $2.3 million, down from $9.4 million for the first nine months of 2017.
Loans, deposits and assets under management rose, which the bank's top executive took as an encouraging sign. The Chambersburg-based bank had assets of $1.2 billion as of Sept. 30.
"The robust underlying momentum in each of our retail, commercial and wealth management business lines contributed to our strong earnings performance this quarter," Timothy G. Henry, Franklin Financial's president and CEO said in a statement. "As we near the end of 2018, we continue to focus on the expansion of our sales and service platforms while optimizing our digital capabilities to better serve customers and deliver exceptional returns for our shareholders."
York Traditions Bank saw net income rise to nearly $1.3 million for the third quarter, up from nearly $1.1 million for the same period in 2017.
In a press release, the bank's top executive - president and CEO Eugene J. Draganosky - said the bank benefited from rising interest income and loan growth, but noted that competition is heating up for loans and deposits.
The bank also noted a cut in its tax bill of $218,000 due to the federal tax reform that took effect in December.
In October, the York Township-based bank opened an office in downtown York, its sixth overall.
York Traditions' total assets, meanwhile, were $465.6 million as of Sept. 30, up from $441.3 million at the end of 2017.
Codorus Valley Bancorp Inc., parent of PeoplesBank, posted net income of $5.1 million in the third quarter of 2018, up from $3.4 million from the same period in 2017.
For the first nine months of the year, the bank's net income was $15.2 million, up from $10.5 million for the same period last year.
A lower tax bill helped fuel the rise. The bank paid $4 million in taxes for the first nine months of 2018, down from $5 million in the first nine months of 2017.
The bank also recently opened its first full-service branch in Lancaster County and hired industry veteran Craig L. Kauffman as president and CEO of PeoplesBank. Kauffman also is COO and executive president of parent company Codorus Valley.
The bank's assets stood at $1.8 billion as of Sept. 30, up from $1.7 billion at the end of 2017.
Orrstown Financial Services Inc. reported net income of $4 million for the third quarter of 2018, up from $2.8 million for the same period a year ago.
For the first nine months of the year, the Shippensburg-based bank had net income of $11.7 million, up from $8.1 million for the first nine months of 2017.
The bank has been active lately on the merger front.
On Oct. 1, it closed a deal to buy Franklin County-based Mercersburg Financial Corp., parent of First Community Bank of Mercersburg.
Three weeks later, Orrstown said it was buying a Baltimore-area institution, Hamilton Bank.
Orrstown's assets were $1.72 billion as of Sept. 30, up from $1.56 billion at the end of 2017. The recent mergers are expected to bring that total to $2.5 billion.
Mid Penn Bancorp Inc. absorbed two acquisitions this year, which took a bite out of net income but led to growth in other areas.
The Millersburg-based bank earned net income of $2.13 million in the third quarter of 2018, down from $2.25 million from the same period a year ago.
The bank's net income for the first nine months of the year was $5.9 million, down from $6.6 million in the comparable period in 2017.
M&A expenses for the bank totaled $3 million in the third quarter of 2018 and nearly $5 million overall for the first nine months of the year.
The two acquisitions, meanwhile, have spread Mid Penn's footprint to the west and to the east.
In January, the bank closed on a purchase of Scottdale Bank & Trust Co. in western Pennsylvania.
Six months later Mid Penn wrapped up a purchase of First Priority Financial Corp., based in Malvern,a suburb of Philadelphia.
As of Sept. 30, Mid Penn's assets had risen to $2.04 billion, up from $1.17 billion at end of 2017.
"While giving the necessary attention to managing our acquisitions, we continued to realize consistent organic growth of loans and deposits," Mid Penn President and CEO Rory G. Ritrievi said in a statement. "With the addition of the quality customer relationships from Scottdale and First Priority, we are well positioned to realize favorable increases in net interest income, and continued growth in fee-based and non-interest income sources, to support our overall profitability."