A series of one-time expenses cut into the earnings of Swatara Township-based Metro Bancorp Inc., which reported net income down more than 17 percent from the second quarter of 2014.
The holding company for Metro Bank took a hit of about $1.8 million in one-time expenses during the quarter, knocking net income from $5.1 million in 2014’s second quarter to $4.2 million in the most recent quarter.
The largest of the one-time expenses stemmed from a stock-based compensation plan for employees that cost the company $1.4 million, about $823,000 of which was not tax deductible and charged to the company.
The expense comes from a provision allowing for accelerated vesting of stock options should there be a “change of identity” of at least four members of the company’s board of directors in two consecutive calendar years. When Metro appointed activist investor Richard Lashley to the board in May, it was the fourth new director in about a year at the company.
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Additional expenses resulted from branch closures. The company closed two retail branches in April, one in Springettsbury Township, York County, and another in the Carlisle Commons, at 20 Noble Boulevard in the borough.
The closures cost about $462,000, the company reported. By the third quarter, Metro will experience cost savings from the moves.
The company also announced it has canceled its plans to build a new branch at Airport Road and Route 501 in Manheim Township, which caused the company to write off $499,000 of accumulated costs in preconstruction. The branch had been a subject of debate between the company and Manheim Township over how much Metro would have to pay in impact fees. The township wanted about $124,000 in impact fees, while Metro’s calculations had the fee at about $53,000.
Metro officials were unavailable for comment on the specific reasons for abandoning the project.
In late July, Commonwealth Court upheld the township’s position. Metro officials did not respond to a message on why the bank decided to stop construction.
For the first time, the company went over $3 billion in assets, hitting $3.001 billion. That was up 5 percent from about $2.87 billion at the end of the second quarter of 2014. The bank has 32 branches in Berks, Cumberland, Dauphin, Lancaster, Lebanon and York counties.
Metro trades its shares on the NASDAQ exchange at METR.