AmeriServ Financial in Johnstown, Pa., will take several charges in coming quarters, including one tied to litigation and client loss in its investment advisory business.
The $1 billion-asset company said in a press release Thursday that it will record a $675,000 noncash charge in the third quarter tied to a lawsuit it filed against the former chief executive of West Chester Capital Advisors, its registered investment advisor unit, tied to alleged violations in his employment contract. The company disclosed in its quarterly filing in August that the lawsuit alleges non-solicitation and non-competition clauses of the agreement. The executive was terminated in January.
"The former CEO's departure and the litigation caused certain disruption within the [unit's] customer base during the first half of 2014," AmeriServ disclosed in its quarterly filing.
The company also disclosed in its latest filing that it expects to incur $150,000 in one-time fees for the third quarter after it hired a consulting firm to provide advice on reducing expenses. "The company expects that its payback on this project will be significant," the company said.
AmeriServ also said it could incur a one-time charge of $550,000 in the fourth quarter tied to early-retirement packages. The company has offered the packages to 46 employees, or 13% of its work force.