Four midstate institutions are among the 200 most profitable community banks in the country, according to an annual ranking by American Banker.
Millersburg-based Mid Penn Bancorp, Gettysburg-based ACNB Corp., York Township-based Codorus Valley Bancorp and Jonestown-based Jonestown Bank & Trust Co. all made the cut, placing them among roughly the top third of publicly traded American banks with less than $2 billion in assets.
All four institutions also landed on the list last year.
American Banker, an online and print trade newspaper for the banking and finance industries, annually ranks community banks based on their return on average equity, a number measuring their ratio of net income to stockholders’ average equity.
The 669 institutions that met American Bankers’ definition of small banks had a median three-year ROAE of 7.62 percent last year. The midstate banks on the list had ROAEs ranging from 9.10 percent (Jonestown, which was ranked 177 on the list) to 9.95 percent (Mid Penn, which was ranked 122).
Pennsylvania was one of six states to have more than 10 banks on the list this year, but, for the first time in several years, it did not lead the country in terms of volume of banks making the cut. That honor went to California, which had 24 on the list compared to the Keystone State’s 23.
Some of the other Pennsylvania banks on the list are not locally headquartered but have a presence here. Tioga County-based First Citizens Community Bank, for example, has offices in the Lebanon and Lancaster areas and has appeared on the list for 10 consecutive years. It ranked 51st in 2016.
American Banker notes that much of the rising profitability banks experienced in 2016 had less to do with revenue growth than it did with cost control. And many are controlling costs by spreading out expenses across growing asset bases – in other words, banks are increasing their footprints while making operations more efficient.
That trend holds true for the locally headquartered banks that made the list: ACNB is buying a small bank in northern Maryland, Codorus Valley subsidiary PeoplesBank recently grew its presence in midstate retirement communities, JB&T is expanding in Lancaster County and Mid Penn is growing both organically and through a pending purchase is western Pennsylvania.
Mid Penn Bancorp
- 2016 rank: 122 out of 669
- 2015 rank: 145 out of 684
- 2016 three-year ROAE: 9.95 percent, up from 9.49 in 2015
- 2016 rank: 153 out of 669
- 2015 rank: 158 out of 684
- 2016 three-year ROAE: 9.42 percent, up from 9.37 in 2015
Codorus Valley Bancorp
- 2016 rank: 167 out of 669
- 2015 rank: 134 out of 684
- 2016 three-year ROAE: 9.21 percent, down from 9.75 in 2015
Jonestown Bank & Trust Co.
- 2016 rank: 177 out of 669
- 2015 rank: 175 out of 684
- 2016 three-year ROAE: 9.10 percent, up from 9.02 in 2015
Highest-ranked small bank
- Fidelity Federal Bancorp in Indiana, with a three-year ROAE of 20.46 percent