Fox Chase Bancorp (FXCB) in Hatboro, Pa., is planning to restructure its balance sheet this quarter in an effort to better position itself for potential changes in interest rates and improve its net interest income.
The $1 billion-asset company said it it intends to pay off roughly $55 million in long-term borrowings and replace them with shorter-term funding sources, and sell off about $75 million in investment securities.
The cost of prepaying the debt, $3.1 million, combined with an anticipated $1.9 million gain on the sale of the securities will reduce its pre-tax earnings for the quarter by $1.2 million, Fox Chase said, or roughly the same amount it earned in the first quarter.
Going forward, Fox Chase expects the restructuring to increase its net interest income by about $1.2 million a year.
Fox Chase's shares closed at $14.13 Wednesday, up 2.7% from Tuesday's closing price.