The banking world treated one longtime Central Pennsylvania bank well and was just as good to one about to introduce itself to the region.
Orrstown Financial Services Inc.
The company actually reported earnings of $2.36 per diluted share, but $2 of that came from the reversal of a valuation allowance from September 2012.
Orrstown Chief Financial Officer David Boyle explained that the bank wrote down an asset of about $16.2 million at that time because of the issues the bank was going through.
A series of bad commercial loans left the company reporting quarterly losses in five of six consecutive quarters in 2011 and 2012. It also left the company with consent orders from both the Pennsylvania Department of Banking and Securities and Federal Reserve Board.
The state has since eased its order. The Fed has not yet, but Boyle said this week he expects to hear something about the consent order “within the foreseeable future.”
He said the company discussed its decision to put the asset back on the books with the Fed and it did not object to the accounting measure.
Without the markup, the bank reported net income of about $2.9 million for the quarter, in line with the same period in 2013. Earnings per share also was even at 36 cents.
The fourth-quarter report followed another very good third-quarter report that net income rose nearly 150 percent between 2013 and 2014.
“The changes we’ve made have started showing up on the balance sheet,” Boyle said.
Orrstown has about $1.2 billion in assets and trades on the NASDAQ exchange at the ticker symbol ORRF.
BB&T Corp., which has agreed to purchase Lititz-based Susquehanna Bancshares Inc., said in its earnings report Thursday it already has spent $11 million in merger-related costs with Susquehanna and the Bank of Kentucky.
The holding company for North-Carolina-based BB&T Bank announced in November it would acquire Susquehanna for $2.5 billion in a deal expected to close in the second half of 2015. In Thursday’s report, it said its noninterest expense was $1.4 billion, down $145 million from the third quarter. However, it reported $11 million worth of restructuring and merger-related costs that offset the decrease in noninterest spending.
On Thursday, Susquehanna reported it spent $885,000 on merger-related costs in the fourth quarter.
Even with the costs, BB&T reported net income of $557 million for the quarter, or 76 cents per diluted share. That was up from the fourth quarter of 2013, when it reported $537 million in net income, or 75 cents per share.
For the year, it reported $2 billion in net income, up 25 percent from 2013.
In the report, BB&T Chairman and CEO Kelly S. King called the Susquehanna acquisition an “exciting opportunity and an attractive extension of our mid-Atlantic footprint into growing and diverse markets.”
BB&T trades on the New York Stock Exchange at BBT and has $186.8 billion in assets.