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Penns Woods Bancorp, Inc. Reports Fourth Quarter 2015 Operating Earnings

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WILLIAMSPORT, Pa., Jan. 26, 2016 (GLOBE NEWSWIRE) -- Penns Woods Bancorp, Inc. (NASDAQ: PWOD)

Penns Woods Bancorp, Inc. continued its solid earnings, supported by strong asset and deposit growth, achieving net income of $13,898,000 for the twelve months ended December 31, 2015 resulting in basic and dilutive earnings per share of $2.91.

Highlights

  • Net income from core operations ("operating earnings"), which is a non-generally accepted accounting principles (GAAP) measure of net income excluding net securities gains and bank owned life insurance gains on death benefits, increased to $3,156,000 for the three months ended December 31, 2015 compared to $2,560,000 for the same period of 2014. Net income from core operations increased to $12,202,000 for the twelve months ended December 31, 2015 compared to $12,114,000 for the same period of 2014. Impacting the three and twelve months ended December 31, 2015 compared to 2014 were a decrease in the provision for loan losses of $1,125,000 and $550,000 due to the reduction in charge-offs partially offset by the loan portfolio growth. In addition, the investment portfolio has declined $55,983,000 from December 31, 2014 to December 31, 2015 as part of our strategy to position the balance sheet for a rising rate environment.
  • Operating earnings per share for the three months ended December 31, 2015 and 2014 were $0.66 and $0.53 for both basic and dilutive. Operating earnings per share for the twelve months ended December 31, 2015 were $2.56 basic and dilutive compared to $2.52 basic and dilutive for the same period of 2014.
  • Return on average assets was 1.15% for the three months ended December 31, 2015 compared to 0.93% for the corresponding period of 2014. Return on average assets was 1.08% for the twelve months ended December 31, 2015 compared to 1.19% for the corresponding period of 2014.
  • Return on average equity was 10.73% for the three months ended December 31, 2015 compared to 8.33% for the corresponding period of 2014. Return on average equity was 10.11% for the twelve months ended December 31, 2015 compared to 10.79% for the corresponding period of 2014.

"The past twelve months have seen the Penns Woods Family expand our foot print and balance sheet, while preparing for the future. During the fourth quarter of 2015 JSSB expanded its market coverage in Lewisburg with the opening of a branch that will serve as the hub for our southernmost locations. The loan portfolio experienced double digit growth, while the deposit portfolio also experienced solid growth. Supporting the footprint expansion and balance sheet growth was the continued hard work and dedication of our employees," said Richard A. Grafmyre, CFP®, President and CEO.

A reconciliation of the non-GAAP financial measures of operating earnings, operating return on assets, operating return on equity, and operating earnings per share, described in the highlights, to the comparable GAAP financial measures is included at the end of this press release.

Net Income

Net income, as reported under GAAP, for the three and twelve months ended December 31, 2015 was $3,746,000 and $13,898,000 compared to $2,883,000 and $14,608,000 for the same periods of 2014. Results for the three and twelve months ended December 31, 2015 compared to 2014 were impacted by an increase in after-tax securities gains of $267,000 (from a gain of $323,000 to a gain of $590,000) for the three month periods and a decrease in after-tax securities gains of $624,000 (from a gain of $2,320,000 to a gain of $1,696,000) for the twelve month periods. In addition, a gain of $174,000 on death benefits related to bank owned life insurance was recorded during the first quarter of 2014. Basic and dilutive earnings per share for the three and twelve months ended December 31, 2015 were $0.79 and $2.91 compared to $0.60 and $3.03 for the corresponding periods of 2014. Return on average assets and return on average equity were 1.15% and 10.73% for the three months ended December 31, 2015 compared to 0.93% and 8.33% for the corresponding period of 2014. Return on average assets and return on average equity were 1.08% and 10.11% for the twelve months ended December 31, 2015 compared to 1.19% and 10.79% for the corresponding period of 2014.

Net Interest Margin

The net interest margin for the three and twelve months ended December 31, 2015 was 3.55% and 3.61% compared to 3.73% and 3.81% for the corresponding periods of 2014. The decline in the net interest margin was driven by a decreasing yield on the loan and investment portfolios due to the continued low rate environment and a reduction in the size of the investment portfolio as it is positioned for a rising rate environment. The impact of the declining earning asset yield and decreasing investment portfolio balance was offset by a 14.16% growth in gross loans from December 31, 2014 to December 31, 2015 resulting in net interest income remaining flat compared to the comparable three and twelve month periods of 2014. The loan growth was funded by an increase in core deposits, decrease in the investment portfolio, and an increase in borrowings. Core deposits represent a lower cost funding source than time deposits and comprise 78.55% of total deposits at December 31, 2015 and 77.96% at December 31, 2014.

"Due to the low rate environment, we continue to experience a declining yield on earning assets as legacy assets are replaced and new earning assets are added at current interest rates. While this results in a lower than historical earning asset yield, we have maintained a flat level of net interest income by focusing on adding quality earning assets such as short and intermediate term loans which has led to growth in the home equity segment of the loan portfolio. The investment portfolio is being actively managed to reduce exposure to a rising rate environment. This has resulted in the selective selling of bonds, primarily long- term municipal bonds, within the investment portfolio as interest and market risk within the investment portfolio continues to be reduced. Proceeds from the reduction of the investment portfolio have been used to fund the significant growth within the loan portfolio. The reduction in size of the investment portfolio does negatively impact current earnings, but the actions play a key role in our long-term asset liability management strategy," commented President Grafmyre.

Assets

Total assets increased $75,046,000 to $1,320,057,000 at December 31, 2015 compared to December 31, 2014. Net loans increased $128,163,000 to $1,033,163,000 at December 31, 2015 compared to December 31, 2014 primarily due to campaigns related to increasing home equity product market share during 2014 and 2015 and growth in the commercial loan portfolio. The investment portfolio decreased $55,983,000 from December 31, 2014 to December 31, 2015 due to our strategy to reduce the investment portfolio duration through the selective selling of bonds as opportunities develop. The combination of loan portfolio growth and a decrease in the size of the investment portfolio has resulted in a shortening of the overall earning asset portfolio duration consistent with a strategy to reduce the interest rate and market risk exposure to a rising rate environment.

Non-performing Loans

The ratio of non-performing loans to total loans decreased to 0.90% at December 31, 2015 from 1.34% at December 31, 2014. The ratio decreased due to a decrease in non-performing loans and an increase in total loans from December 31, 2014 to December 31, 2015. The decrease in non-performing loans to $9,446,000 at December 31, 2015 from $12,248,000 at December 31, 2014 is primarily the result of a payoff of a large commercial real estate loan and the resolution of several smaller commercial real estate loans. The majority of non-performing loans are centered on several loans that are either in a secured position and have sureties with a strong underlying financial position or have a specific allocation for any impairment recorded within the allowance for loan losses. Net loan charge-offs of $835,000 for the twelve months ended December 31, 2015 impacted the allowance for loan losses which was 1.15% of total loans at December 31, 2015 compared to 1.16% at December 31, 2014. The majority of the loans charged-off had a specific allowance within the allowance for loan losses.

Deposits

Deposits increased $50,461,000 to $1,031,880,000 at December 31, 2015 compared to December 31, 2014. Core deposits (total deposits excluding time deposits) increased $45,343,000 due to our commitment to building complete banking relationships with our customers. Noninterest-bearing deposits increased $36,705,000 to $280,083,000 at December 31, 2015 compared to December 31, 2014. Driving this growth is our commitment to easy-to-use products, community involvement, and emphasis on customer service. While deposit gathering efforts have centered on core deposits, the lengthening of the time deposit portfolio is in process as part of the strategy to build balance sheet protection in a rising rate environment.

Shareholders' Equity

Shareholders' equity decreased $312,000 to $136,279,000 at December 31, 2015 compared to December 31, 2014. Since December 31, 2014, treasury stock purchases of $2,603,000 for 60,018 shares were completed as part of the stock repurchase plan. The change in accumulated other comprehensive loss from $1,667,000 at December 31, 2014 to $3,799,000 at December 31, 2015 is a result of a decrease in unrealized gains on available for sale securities from an unrealized gain of $2,930,000 at December 31, 2014 to an unrealized gain of $258,000 at December 31, 2015. The amount of accumulated other comprehensive loss at December 31, 2015 was also impacted by the change in net excess of the projected benefit obligation over the fair value of the plan assets of the defined benefit pension plan resulting in an decrease in the net loss of $540,000 to $4,057,000 at December 31, 2015. The current level of shareholders' equity equates to a book value per share of $28.71 at December 31, 2015 compared to $28.30 at December 31, 2014 and an equity to asset ratio of 10.32% at December 31, 2015 compared to 10.92% at December 31, 2014. Excluding goodwill and intangibles, book value per share was $24.84 at December 31, 2015 compared to $24.44 at December 31, 2014. Dividends declared for each of the three and twelve months ended December 31, 2015 and 2014 were $0.47 and $1.88 per share.

Penns Woods Bancorp, Inc. is the parent company of Jersey Shore State Bank, which operates fifteen branch offices providing financial services in Lycoming, Clinton, Centre, Montour, and Union Counties, and Luzerne Bank, which operates eight branch offices providing financial services in Luzerne County. Investment and insurance products are offered through Jersey Shore State Bank's subsidiary, The M Group, Inc. D/B/A The Comprehensive Financial Group.

NOTE: This press release contains financial information determined by methods other than in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"). Management uses the non-GAAP measure of net income from core operations in its analysis of the company's performance. This measure, as used by the Company, adjusts net income determined in accordance with GAAP to exclude the effects of special items, including significant gains or losses that are unusual in nature such as net securities gains and losses. Because certain of these items and their impact on the Company's performance are difficult to predict, management believes presentation of financial measures excluding the impact of such items provides useful supplemental information in evaluating the operating results of the Company's core businesses. These disclosures should not be viewed as a substitute for net income determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

This press release may contain certain "forward-looking statements" including statements concerning plans, objectives, future events or performance and assumptions and other statements, which are statements other than statements of historical fact. The Company cautions readers that the following important factors, among others, may have affected and could in the future affect actual results and could cause actual results for subsequent periods to differ materially from those expressed in any forward- looking statement made by or on behalf of the Company herein: (i) the effect of changes in laws and regulations, including federal and state banking laws and regulations, and the associated costs of compliance with such laws and regulations either currently or in the future as applicable; (ii) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies as well as by the Financial Accounting Standards Board, or of changes in the Company's organization, compensation and benefit plans; (iii) the effect on the Company's competitive position within its market area of the increasing consolidation within the banking and financial services industries, including the increased competition from larger regional and out-of-state banking organizations as well as non-bank providers of various financial services; (iv) the effect of changes in interest rates; and (v) the effect of changes in the business cycle and downturns in the local, regional or national economies. For a list of other factors which could affect the Company's results, see the Company's filings with the Securities and Exchange Commission, including "Item 1A. Risk Factors," set forth in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

You should not place undue reliance on any forward-looking statements. These statements speak only as of the date of this press release, even if subsequently made available by the Company on its website or otherwise. The Company undertakes no obligation to update or revise these statements to reflect events or circumstances occurring after the date of this press release.

Previous press releases and additional information can be obtained from the Company's website at www.jssb.com.

THIS INFORMATION IS SUBJECT TO YEAR-END AUDIT ADJUSTMENT

PENNS WOODS BANCORP, INC
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
   
 December 31, 
(In Thousands, Except Share Data) 2015  2014 % Change
ASSETS   
Noninterest-bearing balances$22,044 $19,403  13.61%
Interest-bearing balances in other financial institutions 752  505  48.91%
Total cash and cash equivalents 22,796  19,908  14.51%
Investment securities, available for sale, at fair value 176,157  232,213  (24.14)%
Investment securities, trading 73  100.00%
Loans held for sale 757  550  37.64%
Loans 1,045,207  915,579  14.16%
Allowance for loan losses (12,044) (10,579) 13.85%
Loans, net 1,033,163  905,000  14.16%
Premises and equipment, net 21,830  21,109  3.42%
Accrued interest receivable 3,686  3,912  (5.78)%
Bank-owned life insurance 26,667  25,959  2.73%
Investment in limited partnerships 899  1,560  (42.37)%
Goodwill 17,104  17,104 — %
Intangibles 1,240  1,456  (14.84)%
Deferred tax asset 8,990  8,101  10.97%
Other assets 6,695  8,139  (17.74)%
TOTAL ASSETS$1,320,057 $1,245,011  6.03%
LIABILITIES   
Interest-bearing deposits$751,797 $738,041  1.86%
Noninterest-bearing deposits 280,083  243,378  15.08%
Total deposits 1,031,880  981,419  5.14%
Short-term borrowings 46,638  40,818  14.26%
Long-term borrowings 91,025  71,176  27.89%
Accrued interest payable 426  381  11.81%
Other liabilities 13,809  15,250  (9.45)%
TOTAL LIABILITIES 1,183,778  1,109,044  6.74%
SHAREHOLDERS' EQUITY   
Preferred stock, no par value, 3,000,000 shares authorized; no shares issuedn/a
Common stock, par value $8.33, 15,000,000 shares authorized; 5,004,984 and 5,002,649 shares issued 41,708  41,688  0.05%
Additional paid-in capital 49,992  49,896  0.19%
Retained earnings 58,038  53,107  9.29%
Accumulated other comprehensive loss:   
Net unrealized gain on available for sale securities 258  2,930  (91.19)%
Defined benefit plan (4,057) (4,597) 11.75%
Treasury stock at cost, 257,852 and 197,834 shares (9,660) (7,057) 36.89%
TOTAL SHAREHOLDERS' EQUITY 136,279  135,967  0.23%
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$1,320,057 $1,245,011  6.03%


PENNS WOODS BANCORP, INC.
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
 
  Three Months Ended December 31,
 Twelve Months Ended December 31,
(In Thousands, Except Per Share Data) 2015  2014 % Change 2015  2014 % Change
INTEREST AND DIVIDEND INCOME:      
Loans including fees$10,197 $9,472  7.65%$39,134 $36,495  7.23%
Investment securities:      
Taxable 698  1,049  (33.46)% 3,426  5,111  (32.97)%
Tax-exempt 608  793  (23.33)% 2,795  3,453  (19.06)%
Dividend and other interest income 172  146  17.81% 769  547  40.59%
TOTAL INTEREST AND DIVIDEND INCOME 11,675  11,460  1.88% 46,124  45,606  1.14%
INTEREST EXPENSE:      
Deposits 801  748  7.09% 3,129  2,995  4.47%
Short-term borrowings 38  22  72.73% 116  54  114.81%
Long-term borrowings 498  482  3.32% 1,974  1,913  3.19%
TOTAL INTEREST EXPENSE 1,337  1,252  6.79% 5,219  4,962  5.18%
NET INTEREST INCOME 10,338  10,208  1.27% 40,905  40,644  0.64%
PROVISION FOR LOAN LOSSES 480  1,605  (70.09)% 2,300  2,850  (19.30)%
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 9,858  8,603  14.59% 38,605  37,794  2.15%
NON-INTEREST INCOME:      
Service charges 611  597  2.35% 2,383  2,419  (1.49)%
Securities gains, available for sale 879  490  79.39% 2,592  3,515  (26.26)%
Securities gains (losses), trading 15 n/a (22)n/a
Bank-owned life insurance 179  187  (4.28)% 720  923  (21.99)%
Gain on sale of loans 438  490  (10.61)% 1,743  1,803  (3.33)%
Insurance commissions 158  231  (31.60)% 781  1,146  (31.85)%
Brokerage commissions 228  273  (16.48)% 1,064  1,077  (1.21)%
Other 803  1,176  (31.72)% 3,504  3,625  (3.34)%
TOTAL NON-INTEREST INCOME 3,311  3,444  (3.86)% 12,765  14,508  (12.01)%
NON-INTEREST EXPENSE:      
Salaries and employee benefits 3,950  4,477  (11.77)% 17,023  17,273  (1.45)%
Occupancy 527  572  (7.87)% 2,248  2,301  (2.30)%
Furniture and equipment 698  626  11.50% 2,622  2,536  3.39%
Pennsylvania shares tax 243  169  43.79% 954  907  5.18%
Amortization of investments in limited partnerships 165  165 — % 661  661 — %
Federal Deposit Insurance Corporation deposit insurance 213  174  22.41% 867  746  16.22%
Marketing 178  152  17.11% 612  532  15.04%
Intangible amortization 76  83  (8.43)% 311  345  (9.86)%
Other 2,267  2,094  8.26% 8,438  8,589  (1.76)%
TOTAL NON-INTEREST EXPENSE 8,317  8,512  (2.29)% 33,736  33,890  (0.45)%
INCOME BEFORE INCOME TAX PROVISION 4,852  3,535  37.26% 17,634  18,412  (4.23)%
INCOME TAX PROVISION 1,106  652  69.63% 3,736  3,804  (1.79)%
NET INCOME$3,746 $2,883  29.93%$13,898 $14,608  (4.86)%
EARNINGS PER SHARE - BASIC AND DILUTED$0.79 $0.60  31.67%$2.91 $3.03  (3.96)%
WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC AND DILUTED 4,746,910  4,804,600  (1.20)% 4,772,239  4,816,149  (0.91)%
DIVIDENDS DECLARED PER SHARE$0.47 $0.47 — %$1.88 $1.88 — %


       
PENNS WOODS BANCORP, INC.
AVERAGE BALANCES AND INTEREST RATES
 
 Three Months Ended
 December 31, 2015December 31, 2014
 Average Average Average Average 
 (Dollars in Thousands)BalanceInterestRateBalanceInterestRate
ASSETS:      
Tax-exempt loans$ 52,329  $485  3.68%$ 33,700  $366  4.30%
All other loans  967,751   9,877  4.05%  873,090   9,230  4.19%
Total loans  1,020,080   10,362  4.03%  906,790   9,596  4.20%
Federal funds sold—%—%
Taxable securities  108,835   867  3.19%  142,639   1,191  3.34%
Tax-exempt securities  77,447   921  4.76%  89,301   1,202  5.38%
Total securities  186,282   1,788  3.84%  231,940   2,393  4.13%
Interest-bearing deposits  3,463   3  0.34%  5,232   4  0.30%
Total interest-earning assets  1,209,825   12,153  3.99%  1,143,962   11,993  4.17%
Other assets  97,197      96,111    
TOTAL ASSETS$ 1,307,022    $ 1,240,073    
LIABILITIES AND SHAREHOLDERS' EQUITY:      
Savings$ 143,774   14  0.04%$ 139,145   14  0.04%
Super Now deposits  177,733   112  0.25%  181,588   134  0.29%
Money market deposits  204,092   129  0.25%  209,235   144  0.27%
Time deposits  224,435   546  0.97%  217,371   456  0.83%
Total interest-bearing deposits  750,034   801  0.42%  747,339   748  0.40%
Short-term borrowings  47,212   38  0.32%  32,468   22  0.27%
Long-term borrowings  91,025   498  2.14%  71,177   482  2.65%
Total borrowings  138,237   536  1.52%  103,645   504  1.90%
Total interest-bearing liabilities  888,271   1,337  0.59%  850,984   1,252  0.58%
Demand deposits  262,599      237,026    
Other liabilities  16,455      13,672    
Shareholders' equity  139,697      138,391    
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $1,307,022       $1,240,073    
Interest rate spread   3.40%  3.59%
Net interest income/margin 
 $10,816  3.55% $10,741  3.73%
 
 Three Months Ended December 31,  
   2015   2014  
Total interest income$ 11,675  $11,460  
Total interest expense  1,337   1,252  
Net interest income  10,338   10,208  
Tax equivalent adjustment  478   533  
Net interest income (fully taxable equivalent)$ 10,816  $10,741  
 


       
 Twelve Months Ended
 December 31, 2015
December 31, 2014

(Dollars in Thousands)
Average
Balance

Interest
Average
Rate
Average
Balance

Interest
Average
Rate
ASSETS:      
Tax-exempt loans$  43,395 $ 1,679  3.87%$  29,461 $ 1,295  4.40%
All other loans 932,179  38,026  4.08% 828,796  35,640  4.30%
Total loans 975,574  39,705  4.07% 858,257  36,935  4.30%
Federal funds sold—% 170 —%
Taxable securities 127,052  4,183  3.29% 161,889  5,626  3.48%
Tax-exempt securities 83,293  4,235  5.08% 94,688  5,232  5.53%
Total securities 210,345  8,418  4.00% 256,577  10,858  4.23%
Interest-bearing deposits 4,238  12  0.28% 9,318  32  0.34%
Total interest-earning assets 1,190,157  48,135  4.04% 1,124,322  47,825  4.25%
Other assets 97,103    100,983   
TOTAL ASSETS$1,287,260   $1,225,305   
LIABILITIES AND SHAREHOLDERS' EQUITY:      
Savings$  143,055  56  0.04%$  140,575  81  0.06%
Super Now deposits 187,396  491  0.26% 182,229  583  0.32%
Money market deposits 207,252  554  0.27% 210,066  561  0.27%
Time deposits 220,360  2,028  0.92% 223,537  1,770  0.79%
Total interest-bearing deposits 758,063  3,129  0.41% 756,407  2,995  0.40%
Short-term borrowings 38,909  116  0.30% 22,342  54  0.24%
Long-term borrowings 84,721  1,974  2.30% 71,195  1,913  2.65%
Total borrowings 123,630  2,090  1.67% 93,537  1,967  2.07%
Total interest-bearing liabilities 881,693  5,219  0.59% 849,944  4,962  0.58%
Demand deposits 251,029    225,981   
Other liabilities 17,047    13,933   
Shareholders' equity 137,491    135,447   
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $  1,287,260   $1,225,305   
Interest rate spread   3.45%   3.67%
Net interest income/margin $42,916  3.61% $42,863  3.81%


  
 Twelve Months Ended December 31,
  2015  2014 
Total interest income$  46,124 $  45,606 
Total interest expense 5,219  4,962 
Net interest income 40,905  40,644 
Tax equivalent adjustment 2,011  2,219 
Net interest income (fully taxable equivalent)$  42,916 $  42,863 


      
(Dollars in Thousands, Except Per Share Data)Quarter Ended
 12/31/20159/30/20156/30/20153/31/201512/31/2014
Operating Data 
Net income$ 3,746  $3,364 $3,433 $3,355 $2,883 
Net interest income  10,338   10,234  10,222  10,111  10,208 
Provision for loan losses  480   520  600  700  1,605 
Net security gains  894   493  522  661  490 
Non-interest income, excluding net security gains  2,417   2,644  2,535  2,599  2,954 
Non-interest expense  8,317   8,530  8,421  8,468  8,512 
Performance Statistics 
Net interest margin  3.55  3.55% 3.64% 3.69% 3.73%
Annualized return on average assets  1.15  1.04% 1.07% 1.06% 0.93%
Annualized return on average equity  10.73  9.89% 10.05% 9.76% 8.33%
Annualized net loan (recoveries) charge-offs to
average loans
  (0.03)  0.12% 0.07% 0.20% 0.12%
Net (recoveries) charge-offs  (75)  296  161  453  276 
Efficiency ratio  64.6  65.7% 65.3% 66.0% 64.0%
Per Share Data 
Basic earnings per share$ 0.79  $0.71 $0.72 $0.70 $0.60 
Diluted earnings per share  0.79   0.71  0.72  0.70  0.60 
Dividend declared per share  0.47   0.47  0.47  0.47  0.47 
Book value  28.71   28.54  28.33  28.57  28.30 
Common stock price:     
High  45.28   44.56  48.28  48.91  49.26 
Low  40.47   40.41  41.84  44.41  42.18 
Close  42.46   40.92  44.09  48.91  49.26 
Weighted average common shares:     
Basic  4,747   4,762  4,780  4,802  4,805 
Fully Diluted  4,747   4,762  4,780  4,802  4,805 
End-of-period common shares:     
Issued  5,005   5,004  5,004  5,003  5,003 
Treasury  258   254  238  207  198 

 

 

      
(Dollars in Thousands, Except Per Share Data)Quarter Ended
 12/31/20159/30/20156/30/20153/31/201512/31/2014
Financial Condition Data:     
General     
Total assets$ 1,320,057  $ 1,299,292  $ 1,291,812  $ 1,268,833  $ 1,245,011  
Loans, net  1,033,163    990,164    966,613    933,044    905,000  
Goodwill  17,104    17,104    17,104    17,104    17,104  
Intangibles  1,240    1,316    1,294    1,373    1,456  
Total deposits  1,031,880    1,004,801    1,007,468    996,489    981,419  
Noninterest-bearing  280,083    247,848    244,502    246,231    243,378  
Savings  144,561    143,224    143,415    143,222    139,278  
NOW  176,078    188,444    188,092    186,788    177,970  
Money Market  209,782    204,475    211,412    204,352    204,535  
Time Deposits  221,376    220,810    220,047    215,896    216,258  
Total interest-bearing deposits  751,797    756,953    762,966    750,258    738,041  
Core deposits*  810,504    783,991    787,421    780,593    765,161  
Shareholders' equity  136,279    135,577    134,998    137,004    135,967  
      
Asset Quality     
Non-performing loans$   9,446  $   8,608  $   9,689  $   11,157  $   12,248  
Non-performing loans to total assets  0.72   0.66   0.75   0.88   0.98 
Allowance for loan losses  12,044    11,489    11,265    10,826    10,579  
Allowance for loan losses to total loans  1.15   1.15   1.15   1.15   1.16 
Allowance for loan losses to non-performing loans   127.50    133.47    116.27   97.03   86.37 
Non-performing loans to total loans  0.90   0.86   0.99   1.18   1.34 
                
Capitalization               
Shareholders' equity to total assets  10.32%   10.43%   10.45%   10.80%   10.92% 
                
* Core deposits are defined as total deposits less time deposits


     
Reconciliation of GAAP and Non-GAAP Financial Measures
 
 Three Months Ended
December 31,
Twelve Months Ended
December 31,
(Dollars in Thousands, Except Per Share Data)  2015    2014    2015    2014  
GAAP net income$ 3,746  $ 2,883  $ 13,898  $ 14,608  
Less: net securities and bank-owned life insurance gains, net of tax  590    323    1,696    2,494  
Non-GAAP operating earnings$ 3,156  $ 2,560  $ 12,202  $ 12,114  
 
 Three Months Ended
December 31,
Twelve Months Ended
December 31,
   2015    2014    2015    2014  
Return on average assets (ROA)  1.15%   0.93%   1.08%   1.19% 
Less: net securities and bank-owned life insurance gains, net of tax  0.18%   0.10%   0.13%   0.20% 
Non-GAAP operating ROA  0.97%   0.83%   0.95%   0.99% 
 
 Three Months Ended
December 31,
Twelve Months Ended
December 31,
   2015    2014    2015    2014  
Return on average equity (ROE)  10.73%   8.33%   10.11%   10.79% 
Less: net securities and bank-owned life insurance gains, net of tax  1.69%   0.93%   1.24%   1.85% 
Non-GAAP operating ROE  9.04%   7.40%   8.87%   8.94% 
 
 Three Months Ended
December 31,
Twelve Months Ended
December 31,
 2015201420152014
Basic earnings per share (EPS) $0.79   $0.60   $2.91   $3.03  
Less: net securities and bank-owned life insurance gains, net of tax  0.13    0.07    0.35    0.51  
Non-GAAP basic operating EPS $0.66   $0.53   $2.56   $2.52  
 
 Three Months Ended
December 31,
Twelve Months Ended
December 31,
   2015    2014    2015    2014  
Dilutive EPS $0.79   $0.60   $2.91   $3.03  
Less: net securities and bank-owned life insurance gains, net of tax  0.13    0.07    0.35    0.51  
Non-GAAP dilutive operating EPS $0.66   $0.53   $2.56   $2.52  



Contact: Richard A. Grafmyre, President and Chief Executive Officer 300 Market Street Williamsport, PA 17701 570-322-1111 e-mail: pwod@pwod.com
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