Harrisburg-based Centric Financial Corp., the parent company of Centric Bank, reported a net loss of $711,000 for the third quarter of 2021, after posting second-quarter net income of $3.6 million.
Patricia A. Husic, president and CEO of Centric Financial Corp. and Centric Bank, said in a press release: “The financial results for the third quarter … were adversely affected from the loan charge-offs and increased provision for loan losses, largely attributed to a single commercial lending relationship with purported fraud.”
Asked about the alleged fraud, Husic issued the following statement:
“The results of our third quarter reports come with disappointment. As certain factors changed in relation to this loan in the third quarter, it was prudent to take the financial charge for the loan relationship. Centric Bank has appropriate resources dedicated to this situation in pursuit of the highest recovery possible to best serve our shareholders and customers. The charge-offs recorded during the third quarter are not indicative of our loan portfolio or our credit underwriting. This is not a systemic issue within our portfolio, but rather isolated to this extraordinary situation.”
In the press release, Husic noted “positive momentum from the second quarter,” including loan growth of $20 million, resulting in 8% overall loan growth for 2021; a yield on loans increase of 14 basis points, to 4.79%; and a cost of deposits decrease to 0.38%, the lowest level in the bank’s history.
The financial institution continues to work with its business customers as they deal with the challenges of COVID-19, Husic said in the follow-up statement.
“Centric Bank will always be a champion for businesses and entrepreneurs in the communities we serve,” she said. “We are a safe, secure and sound institution — and we remain well capitalized. We have a passionate and dedicated team … who were just recognized by American Banker for the fourth consecutive year as a 2021 Best Banks to Work For. We are expecting to end the year with a solid fourth quarter.”