Area banks respond to Federal Reserve Survey on lending practices

Tighter standards and weaker demand for commercial and industrial loans (C&I) were among the highlights of the April 2023 Senior Loan Officer Opinion Survey on Bank Lending Practices released recently by the Federal Reserve. 

Banks likewise reported tighter standards and weaker demand for commercial real estate (CRE) loans. 

“With the fight against inflation, this sort of thing happens so it’s not surprising to see our peers experiencing the same things as we’re experiencing here at Peoples,” said Jeffrey Drobins, executive vice president, chief lending officer at Peoples Security Bank & Trust Company. 

“Really, it’s probably the prudent thing that business owners who predict there could be a recession are not looking for credit, they’re holding on to cash. They’re worried about liquidity and leveraging their balancing sheets. Even our existing customers, that’s what we’re seeing them do.” 

Rory Ritrievi, president & CEO at Mid Penn Bancorp, Inc., and Mid Penn Bank, said that through the first quarter of 2023, their organic loan growth had annualized growth of around 11%. 

“That is at the top end of the range we projected for the year even though historically the first quarter is our slowest loan growth quarter of any year,” said Ritrievi.

“As a publicly traded company I cannot give loan growth numbers beyond that first quarter as we have not made any of the numbers past that point public, but I will say that our loan pipelines are just as brisk in the second quarter as they were in the first.”

Three sets of special questions comprised the April 2023 Senior Loan Officer Opinion Survey (SLOOS): 

  • Changes in banks’ lending policies for CRE loans over the past year. 
  • Reasons for banks changed standards for all loan categories over the first quarter of 2023. 
  • Banks’ exceptions for changes in lending standards over the remainder of 2023 and reasons for these changes. 

Banks responded to the first of questions by reporting tightening lending policies for all categories of CRE loans over the past year. Wider spreads of loan rates over banks’ cost of funds and lower loan-to-value ratios were the changes most frequently reported. 

In response to the second set of questions, banks cited a more uncertain or less favorable economic outlook, reduced tolerance for risk, deterioration in collateral values, and concerns regarding banks’ liquidity positions and funding costs. 

The third set of questions concerning banks’ outlook for lending standards over the rest of 2023 led to banks reporting an expected tightening of standards across all loan categories. An expected deterioration in the credit quality of their loan portfolios and in customers’ collateral values, a reduction in risk tolerance, and concerns regarding bank funding costs, bank liquidity position and deposit outflows were cited frequently by banks as reasons for their expectations of tightening lending standards for the remainder of the year. 

Survey results, as they have been in past releases by the Fed, are tabulated for two domestic bank size categories consisting of large banks and other banks. Large category banks contain $50 billion or more in domestic assets as of Dec. 31, 2022. All other banks have less than $50 billion in domestic assets. 

The largest banks are defined as those with $250 billion or more in total domestic assets as of Dec. 31, 2022, and mid-sized banks as those with assets between $50 billion and $250 billion. Mid-sized banks reported more frequently than the largest or other banks the tightening in standards for business loans, these reports were for both for the first quarter and in expectation for the rest of 2023. 

Mid-sized and other banks reported concerns about their liquidity positions, deposit outflows, and funding costs more frequently than the largest banks, as reasons for tightening standards on all loan categories, both in the first quarter and for the remainder of the year.

Mid Penn to move forward with NJ bank acquisition

Harrisburg-based Mid Penn Bancorp Inc. and New Brunswick, New Jersey-based Brunswick Bancorp announced Tuesday that they have received necessary approvals from the applicable regulatory agencies to complete the proposed merger of Brunswick with and into Mid Penn.

Shareholders from Mid Penn and Brunswick overwhelmingly approved the transaction at special meetings held April 25. Mid Penn signed an agreement to acquire Brunswick Bancorp late last year for $53.9 million.

The merger will extend Mid Penn’s footprint into new markets and expand its presence into central New Jersey. Mid Penn, on a pro forma basis following completion of the merger, is expected to have approximately $5 billion in assets. The deal is anticipated to close in the second quarter of 2023.

Mid Penn President and CEO Rory G. Ritrievi said in a release, “We are pleased to have timely received all regulatory and shareholder approvals required in order to consummate our acquisition of Brunswick Bancorp, a transaction that supports our growth objectives, complements our franchise, and propels long-term shareholder value. The level of support for this transaction was tremendous. Of the total number of votes received, over 99% of Brunswick shares voted in favor of the merger and more than 97% of Mid Penn shares also voted in favor of the merger.”

Mid Penn Bancorp Inc. is the parent company of Mid Penn Bank, a full-service commercial bank, and MPB Financial Services LLC, a provider of specialized investment strategies, insurance and planning services to individuals, families and businesses. Mid Penn operates retail locations in 17 counties in Pennsylvania.

Brunswick Bancorp is the holding company for Brunswick Bank & Trust Co., a New Jersey chartered commercial bank that serves central New Jersey through its New Brunswick main office and four additional branch offices.

Paula Wolf is a freelance writer

Harrisburg social services agency brings lawsuit against Mid Penn Bank

The Center for Independent Living of Central PA (CILCP) announced Monday that it filed a complaint against Mid Penn Bank for allegedly breaching their contract and acting in bad faith. 

Filed in Harrisburg last Friday, the lawsuit seeks to hold Mid Penn Bank accountable for its actions, or lack of actions, and to obtain compensation for the damages CILCP endured. 

Based in Harrisburg, CILCP is a non-profit social services agency that aids people with disabilities, CILCP charges that for more than 10 years Mid Penn Bank allowed ACH withdrawals to occur in excess of $249,000 from an account that had no prior record of ACH transactions. 

In a statement to the Central Penn Business Journal, the bank said it values its relationship with the nonprofit.

“We have always valued our relationship with The Center for Independent Living of Central PA (CILCP). While Mid Penn Bank cannot comment on pending litigation, we take the security of our customers seriously and will respond appropriately in court.”

CILCP states that Mid Penn Bank did not attempt to resolve, investigate, or assist CILCP in recovering the funds, and that Mid Penn Bank’s security procedures did not protect CILCP. 

“It is unprofessional and disappointing that a bank, who holds all the company’s funds, says they are sorry for your almost $250,000 loss, but there is nothing they can do to help get the money back,” CILCP CEO Janetta W. Green said in a statement. 

“As a small non-profit, we depend on our banks to protect our money and when the bank’s security measures fail, the bank should be held accountable.” 

The lawsuit looks to obtain compensation for the damages suffered by CILCP because of Mid Penn Bank’s actions. It also seeks to hold Mid Penn Bank responsible for its alleged lack of effective security procedures. 

Mid Penn Bank has headquarters in Millersburg and mid-state locations in Berks, Cumberland, Dauphin, Lancaster, and Lehigh counties.

The story has been updated to include a comment from Mid Penn Bank.

Mid Penn Bank CFO talks sustainable growth and fostering personal relationships

The Central Penn Business Journal recently spoke with Allison Johnson, senior executive vice president and chief financial officer at Mid Penn Bank 

Johnson, 38, was appointed to her role at the Millersburg-based financial institution in May 2022.  

She has most recently served as chief financial officer of Spirit of Texas Bank, where she had worked since 2016. Before that, she was an SEC reporting manager at Florida Community Bank, a fund accountant for Sun Capital Partners, LLC, and auditor with PriceWaterhouseCoopers. 

Before coming to Mid Penn Bank, you worked with banks in Texas and Florida. Do you find there are different needs in the different markets, or are there some that are just universal?  

Lending needs are pretty much universal, particularly on commercial real estate and consumer lending. Commercial and industrial lending varies slightly depending on what part of the country you are in. For example, Florida has a big emphasis on hospitality and other related services, Texas has a concentration of oil and gas lending and corresponding industries, and here in Pennsylvania there is much more manufacturing. At the end of the day though, borrowers are looking for a personalized relationship with 

their lending officer and a quick and efficient lending process. Being able to offer a personalized experience with speed at competitive rates should be the goal of banks in any market.  

What are you pulling from those previous experiences to help Mid Penn grow? 

I’ve seen the good and the bad of rapid growth amongst banks. The goal is sustainable growth where each growth period generates a positive return on equity to fuel the next growth period. Continuously going to the capital markets for more capital to grow through acquisitions that may or may not be accretive to earnings is not sustainable.  

With growth comes risk and managing that increased risk is what is key to a bank’s success. I am able to rely on my previous experiences to assist Mid Penn with its growth trajectory and avoid some common mistakes.  

What do you think are the keys to helping customers feel financially secure in the midst of economic uncertainty?  

The keys to helping customers feel financially secure are having the right tools and the right products. Mid Penn prides itself on great customer service. We are here to help and we hope that our customers know that they are not facing these uncertain times alone.  

Whether you need a checking or savings account, have a small business need, are concerned about retirement, or are in need of an insurance product, we offer a broad array of products and services through the bank as well as other lines of business to help our customers navigate all of their financial needs from end to end.  

What has been your favorite thing about central Pennsylvania so far? 

The seasons! I’m an avid hiker and being able to hike the Appalachian Trail and enjoy the fall foliage is a dream come true.  

Jennifer Botchie Deinlein 


About Allison Johnson  

Johnson has a bachelor of science degree in accounting from the University of Florida and a master’s degree in accounting from Florida State University. She is also a certified public accountant. 

She lives in Harrisburg. 


Businesses serve the community through donations, training service dogs and more!

York-based PeoplesBank recently donated $50,000 to the Y Community Development Corp., which is part of the YMCA of the Roses’ community development work to lift up local neighborhoods through projects ranging from establishing affordable housing to improving public safety infrastructure. 

Millersburg-based Mid Penn Bank, a wholly-owned subsidiary of Mid Penn Bancorp Inc., announced that its Women’s Leadership Network awarded $16,000 in grants to organizations that have a positive and direct impact on the lives of Pennsylvania women and families. The funds are being distributed among 11 nonprofit groups within Mid Penn’s 16-county service area that aid in areas such as health and wellness, mental health, education, housing and workforce development. 

M&T Bank presented 10 nonprofit organizations with $87,500 in year-end donations at its annual “Give Thanks” event Jan. 20. This year’s event celebrated those working to improve the quality of life throughout Dauphin and Cumberland counties. 

Each organization received $8,750. The honorees included Big Brothers Big Sisters; Boys & Girls Club; Central Pennsylvania Food Bank; Joshua Group; LEAF Project; New Hope Ministries; Salvation Army – Carlisle; Salvation Army – Harrisburg; United Way of the Capital Region; and United Way of Carlisle & Cumberland County. 

Mechanicsburg-based West Shore Home is sponsoring a second Susquehanna Service Dog with the arrival of SSD Remy. She is a 12-week-old, black Labrador retriever who will live with her puppy raiser for the next 15 to 18 months. During that time, she will learn manners, self-control and over 20 foundational cues. SSD Remy will then be matched with her partner, where she will enter advanced training to learn specific tasks to meet their unique needs. 

January awards


Camp Hill-based accounting and advisory firm Brown Schultz Sheridan & Fritz was named the No. 2 Best Accounting Firm to Work For in the mid-sized firm category and the No. 3 Best Firm for Young Accountants by Accounting Today in 2022. 


Matt Berger, an investment and trust services market manager with Chambersburg-based F&M Trust, recently received an Under 40 in Wealth Management Award from the American Bankers Association. 

Millersburg-based Mid Penn Bankhas been named, for a second consecutive year, the Best Small Bank in Pennsylvania by Newsweek on their America’s Best Banks list for 2023. 


Lancaster-based Barley Snyder announced that U.S. News & World Report and Best Lawyers have named it a “Best Law Firm” in 26 practice areas. 

Real Estate 

Camp Hill-based Landmark Commercial Realty announced that Barb Murdocca, chief operating officer, and Michael Rohm, senior associate and director of valuation advisory, were each recently given the Greater Harrisburg Association of Realtors Professional Merit Award. 

Paula Wolf is a freelance writer 

Midstate businesses announce over $300k in donations in Jan.

The American Water Charitable Foundation recently partnered with Hershey-based Pennsylvania American Water to present a $25,000 State Strategic Impact Grant to York City Parks Conservancy. Funds will be used for improvements to Williams Park. 

Mechanicsburg-based West Shore Home donated $10,000 to the Marine Corps Toys for Tots program. The donation caps off the company’s toy drive where employees corporate-wide donated over 3,250 toys. 

Millersburg-based Mid Penn Bank and the Penn State Health Department of Urology recently completed their seventh annual “No Shave November” campaign and raised $241,000 for the Division of Urology at Penn State Health. Since its inception, the campaign has contributed more than $622,000 in support of prostate cancer research. 

On Dec. 19, Mid Penn employees volunteered at the Central Pennsylvania Food Bank and presented the organization with a $25,000 grant through the state’s Neighborhood Assistance Program. 

With a matching donation, Lebanon-based APR Supply Co. raised just under $15,000 for the “No Shave November” campaign. APR Supply Co.’s young leaders also collected $2,100 for Homes For Our Troops, a nonprofit that builds and donates specially adapted custom homes nationwide for severely injured post-9/11 veterans. 

Camp Hill-based LeTort Trust wrapped up a year-long celebration of its 20th anniversary by completing a 20 Acts of Kindness initiative. Among the projects were a food and coat drive for Capital Area Head Start; a blood drive for Central Pennsylvania Blood Bank with McConkey Insurance & Benefits; and a financial literacy project with pre-k and kindergarten students at the Joshua Group. 

Compiled by Paula Wolf