Peoples Financial Services (PFIS) in Scranton, Pa., reported a fourth-quarter loss tied to its merger with Penseco Financial Services.
The $1.7 billion-asset company lost $2.8 million in the quarter, compared to Penseco's $2.7 million in profit a year earlier. The merger, which closed in November 2013, was accounted for as a reverse acquisition and, as a result, the historical financial statements reflect Penseco's results.
People's net interest income rose 23%, to $11 million, as income from interest on loans rose. The net interest margin compressed by 15 basis points, to 3.82%.
Noninterest income was rose 4%, to $2.9 million. Higher revenue from service charges and fees offset a decrease in mortgage banking income.
Noninterest expense more than doubled from a year earlier, to $15.8 million, and included $4.8 million in merger-related costs.
Its loan-loss provision jumped 580%, to $1 million. The increase was driven by two large loans totaling $7 million that were downgraded to nonaccrual status. Net chargeoffs rose 30%, to $301,000.