Community Banks Inc. in Harrisburg, Pa., and Rurban Financial Corp. in Defiance, Ohio, said Friday that they are cutting costs to help offset the adverse impact of the inverted yield curve.
Rurban's plan includes a balance-sheet restructuring that will result in a $710,000 charge to fourth-quarter earnings.
The $3.4 billion-asset Community said it would evaluate whether to close underperforming branches, reorganize its management, and consolidate nine banking regions into six. The company said this plan would help stabilize earnings next year, but it would not disclose the expected savings.
The $570 million-asset Rurban said it would combine three subsidiaries into one, sell its $3.6 million credit card portfolio and $1.4 million of nonperforming assets, and benefit from restructuring its balance sheet. Rurban said it had recovered $888,000 on a WorldCom bond loss that was charged off in 2002.
The company did not say how the $710,000 charge would affect fourth-quarter earnings per share.
It said the loss on the sale of nonperforming assets would be about $135,000. It reported a gain of $700,000 from the sale of the credit card portfolio.
