Core Viewpoint - Norwood Financial Corp and PB Bankshares, Inc. have announced a merger agreement, with Presence Bank merging into Wayne Bank, significantly expanding Norwood's geographic footprint and enhancing service capabilities [1][3][4]. Company Overview - Norwood Financial, through Wayne Bank, operates 30 banking offices with consolidated assets of $2.4 billion as of March 31, 2025 [2][10]. - PB Bankshares, the holding company for Presence Bank, operates four banking offices and had assets of $467 million as of March 31, 2025 [2][11]. Merger Details - The merger will create a combined entity with approximately $3.0 billion in assets, positioning it as a premier community bank in Pennsylvania [2][3]. - Under the merger agreement, 80% of Presence's common shares will convert into Norwood Financial common stock, while 20% will be exchanged for cash, with an aggregate transaction value of approximately $54.9 million [4][5]. - The purchase price reflects a multiple of 106.6% of Presence's tangible book value as of March 31, 2025, and a 2.3% core deposit premium [4]. Strategic Benefits - The merger is expected to be approximately 10% accretive to earnings per share in 2026, enhancing market share in Central and Southeastern Pennsylvania [5][8]. - Presence Bank's customers will gain access to a broader product mix and improved services, enhancing the overall customer experience [4][5]. Leadership and Governance - Two non-employee board members from Presence Bank will join the boards of Norwood Financial and Wayne Bank [6]. - Janak M. Amin, President and CEO of Presence, will become Executive Vice President and Chief Operating Officer of Wayne Bank post-merger [4][7]. Regulatory and Closing Conditions - The merger is subject to customary closing conditions, including regulatory approvals and shareholder approval from Presence [8]. - The transaction is expected to close in late Q4 2025 or early Q1 2026 [8].

Financial Performance - For the three months ended March 31, 2025, net income increased to $5,773,000 from $4,433,000 for the same period in 2024, representing a growth of 30.3%[131]. - Net income for the three months ended March 31, 2025, was $5,773,000, an increase of 30.2% from $4,433,000 for the same period in 2024[132]. - Earnings per share for the three months ended March 31, 2025, were $0.63, compared to $0.55 for the same period in 2024, reflecting a 14.5% increase[131]. - The annualized return on average assets for the three months ended March 31, 2025, was 1.01%, up from 0.80% in the same period of 2024[131]. - The annualized return on average equity for the three months ended March 31, 2025, was 10.73%, compared to 9.79% for the same period in 2024[131]. Loans and Credit Quality - Loans receivable totaled $1.751 billion at March 31, 2025, reflecting a $57.0 million increase from $1.694 billion at December 31, 2024, driven by increases in commercial real estate loans, commercial loans, consumer loans, and residential loans[106]. - The allowance for credit losses was $20.442 million as of March 31, 2025, representing 1.15% of total loans outstanding, compared to $19.843 million or 1.16% at December 31, 2024[107]. - Non-performing loans totaled $7.951 million or 0.45% of total loans as of March 31, 2025, slightly down from $7.874 million or 0.46% at December 31, 2024[108]. - The provision for credit losses was $857,000 for the three months ended March 31, 2025, compared to a release of $624,000 for the same period in 2024[136]. - The allowance for credit losses related to loans receivable was 1.15% of loans receivable as of March 31, 2025, representing 257% of non-performing loans[136]. Assets and Equity - Total assets increased to $2.376 billion as of March 31, 2025, up from $2.317 billion as of December 31, 2024, primarily due to a $57.6 million increase in gross loans outstanding[104]. - Total stockholders' equity increased to $220.7 million as of March 31, 2025, up from $213.5 million at December 31, 2024, due to net income and an increase in the fair value of securities[114]. - The fair value of securities available for sale was $408.7 million as of March 31, 2025, up from $397.8 million at December 31, 2024[105]. - Total liquidity as of March 31, 2025, was $484.1 million, representing 20.4% of total assets, slightly up from $470.1 million and 20.3% of total assets as of December 31, 2024[121]. - The Company had cash and cash equivalents of $75.4 million as of March 31, 2025[121]. Deposits and Borrowings - Total deposits increased by $145.3 million during the three months ended March 31, 2025, primarily due to an $80.6 million increase in interest-bearing demand deposits[110]. - Short-term borrowings decreased to $0 at March 31, 2025, from $113.1 million at December 31, 2024, primarily due to a decrease in overnight borrowings[111]. - The maximum borrowing capacity with the Federal Home Loan Bank was approximately $658.3 million as of March 31, 2025, with $118.6 million outstanding[123]. Interest Income and Margin - Net interest income for the three months ended March 31, 2025, rose by $3,147,000, contributing to the overall increase in net income[131]. - Net interest income on a fully taxable equivalent basis for the three months ended March 31, 2025 totaled $18,054,000, an increase of $3,149,000 compared to the same period in 2024[133]. - Interest income (fte) increased to $30,281,000 for the three months ended March 31, 2025, with a yield on average earning assets of 5.54%, compared to $27,133,000 and 5.10% for the same period in 2024[134]. - The net interest margin (tax equivalent basis) for the three months ended March 31, 2025, was 3.30%, up from 2.80% for the same period in 2024[126]. Regulatory Capital - Tier 1 Capital to average assets ratio was 9.40% as of March 31, 2025, compared to 9.36% at December 31, 2024[116]. - The total capital ratio to risk-weighted assets was 13.19% as of March 31, 2025, down from 13.45% as of December 31, 2024[116]. - The Company maintained compliance with all applicable regulatory capital requirements as of March 31, 2025, under the Basel III Capital Rules[119]. - The Company adopted the transition guidance for CECL in the first quarter of 2023, impacting regulatory capital calculations[120]. Other Income and Expenses - Other income totaled $2,351,000 for the three months ended March 31, 2025, an increase from $2,006,000 in the same period in 2024[137]. - Other expenses totaled $12,064,000 for the three months ended March 31, 2025, an increase of $332,000 compared to the same period in 2024[138]. - Income tax expense for the three months ended March 31, 2025 was $1,514,000, with an effective tax rate of 20.8%[139].

Group 1: Earnings Performance - Norwood Financial Corp. reported quarterly earnings of $0.63 per share, exceeding the Zacks Consensus Estimate of $0.59 per share, and up from $0.55 per share a year ago, representing an earnings surprise of 6.78% [1] - The company posted revenues of $20.21 million for the quarter ended March 2025, which missed the Zacks Consensus Estimate by 1.54%, compared to year-ago revenues of $16.72 million [2] - Over the last four quarters, Norwood Financial has surpassed consensus EPS estimates only once [2] Group 2: Stock Performance and Outlook - Norwood Financial shares have declined approximately 17.5% since the beginning of the year, while the S&P 500 has decreased by 10.3% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the coming quarter is $0.61 on revenues of $20.87 million, and for the current fiscal year, it is $2.51 on revenues of $84.43 million [7] Group 3: Industry Context - The Zacks Industry Rank indicates that the Banks - Northeast industry is currently in the top 23% of over 250 Zacks industries, suggesting a favorable environment for stocks in this sector [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors or through tools like the Zacks Rank [5][6]

Financial Performance - Net income for Q1 2025 was $5.8 million, a 30.2% increase from $4.4 million in Q1 2024[5] - Fully diluted earnings per share increased to $0.63, up 14.5% from $0.55 in the same period last year[3] - Net income increased to $5,773,000, up from $4,433,000 year-over-year, reflecting a growth of about 30.2%[14] - The company reported a net income of $5,773 thousand for Q1 2025, compared to a net loss of $12,651 thousand in Q4 2024[16] - Basic earnings per share improved to $0.63 from $0.55, representing a growth of 14.55%[14] - Basic earnings per share for Q1 2025 was $0.63, compared to a loss per share of $1.54 in Q4 2024[16] Interest Income and Margin - Net interest income rose to $17.9 million, a 21.4% increase compared to $14.7 million in Q1 2024[5] - Net interest income for the three months ended March 31, 2025, was $17,857,000, compared to $14,710,000 for the same period in 2024, representing a growth of approximately 21.5%[14] - The net interest margin improved to 3.30%, up 50 basis points from 2.80% in Q1 2024[5] - The net interest margin improved to 2.61% from 2.08%, indicating a significant enhancement in profitability[14] - The company maintained a net interest margin (fte) of 3.30% in Q1 2025, up from 3.04% in Q4 2024[16] - The net interest margin (tax equivalent basis) improved to 3.30% for the quarter ended March 31, 2025, compared to 3.04% in the previous quarter[17] Asset and Loan Growth - Loans grew at an annualized rate of 13.5% during the first quarter, reaching $1.771 billion[3] - Total loans receivable increased to $1,771,269,000, compared to $1,614,448,000, reflecting a growth of about 9.7%[14] - Total assets reached $2.376 billion, reflecting a 5.07% increase from $2.260 billion a year earlier[5] - Total assets as of March 31, 2025, were $2,376,044,000, up from $2,260,423,000, marking a growth of approximately 5.1%[14] - Total interest-earning assets increased to $2,217,043 thousand, up from $2,207,684 thousand in the previous quarter[17] - Loans receivable reached $1,743,572 thousand with a yield of 6.08%, slightly down from 6.18% in the previous quarter[17] Deposits and Liabilities - Total deposits increased by 9.0% year-over-year, totaling $2.004 billion as of March 31, 2025[5] - Total deposits reached $2,004,448,000, up from $1,838,998,000, indicating an increase of approximately 9.0%[14] - Total deposits increased to $2,004,448 thousand, a rise of 7.8% from $1,859,163 thousand at December 31, 2024[15] - Total interest-bearing liabilities were $1,690,438 thousand, with an average rate of 2.93%, down from 3.04% in the previous quarter[17] Efficiency and Asset Quality - The efficiency ratio for Q1 2025 was 59.7%, significantly improved from 70.6% in Q1 2024[5] - Return on average assets increased to 1.01%, a rise of 21 basis points compared to the previous year[5] - Return on average assets rose to 1.01%, compared to 0.80% in the previous year, showing an increase of 26.25%[14] - Return on average assets (annualized) improved to 1.01% in Q1 2025, compared to -2.19% in Q4 2024[16] - Non-performing loans to total loans ratio decreased to 0.45% from 0.23%, showing improved asset quality[14] Risk Management - The allowance for credit losses was $20,442,218, compared to $18,002,000, indicating a proactive approach to risk management[14] - The allowance for credit losses to total loans ratio was 1.15% as of March 31, 2025, slightly down from 1.16% at December 31, 2024[16] - The allowance for credit losses was $20,154 thousand, up from $18,741 thousand in the previous quarter[17]

Quarterly Highlights: Fully diluted EPS of $0.63, a 14.5% increase over the same period in 2024Return on assets rises to over 1.00%.Net interest margin increased 30 basis points vs. the prior quarter and 11 basis points over the prior year.Loans grew at a 13.5% annualized rate during the first quarter.Capital continues to improve on increased earnings and lower AOCI adjustment. HONESDALE, Pa., April 17, 2025 (GLOBE NEWSWIRE) -- Norwood Financial Corp (Nasdaq Global Market-NWFL) and its subsidiary, Wayne Ban ...

Financial Performance - For the year ended December 31, 2024, net interest income was $62.191 million, a slight increase from $62.067 million in 2023[98]. - The net loss for 2024 was $160,000, a significant decline from net income of $16.759 million in 2023[98]. - The dividend payout ratio for 2024 was -6074.38%, indicating a substantial change from 56.19% in 2023[98]. - Total other income for the year ended December 31, 2024, was a loss of $11,151,000, a decrease of $19,275,000 compared to income of $8,124,000 in 2023[158]. - Net realized losses on sales of securities increased to $19,962,000 in 2024, up from a loss of $209,000 in 2023[159]. - Other expenses totaled $48,625,000 for the year ended December 31, 2024, compared to $43,497,000 in 2023, reflecting an increase of $5,128,000[162]. - Salaries and employee benefits increased by $1,453,000 to $25,018,000 in 2024[160]. - The efficiency ratio for 2024 was 68.5%, up from 62.1% in 2023, indicating a decline in operational efficiency[161]. Credit Losses and Allowances - The provision for credit losses decreased significantly to $2.673 million in 2024 from $5.548 million in 2023[98]. - The allowance for credit losses to total loans ratio was 1.16% as of December 31, 2024, slightly down from 1.18% in 2023[98]. - The allowance for credit losses was $19,843,000, representing 1.16% of total loans, compared to $18,968,000 and 1.18% in 2023[121]. - Net charge-offs for 2024 totaled $1,671,000, a significant decrease from $6,078,000 in 2023, reflecting a net charge-off rate of 0.10% compared to 0.39% in the previous year[131]. - The provision for credit losses decreased to $2,546,000 for the twelve months ended December 31, 2024, down from $5,581,000 in 2023[131]. Assets and Loans - Total assets increased to $2.317 billion as of December 31, 2024, up by $116.4 million from $2.201 billion in 2023[99]. - Loans receivable rose to $1.714 billion, an increase of $110.2 million compared to $1.604 billion in 2023, driven by increases in consumer and commercial real estate loans[100]. - As of December 31, 2024, total loans receivable amounted to $1,713,638,000, an increase from $1,603,618,000 in 2023[129]. - The company maintained a diversified loan portfolio with no concentrations exceeding 10% in any one industry as of December 31, 2024[124]. - The company had $716.9 million in commercial real estate loans, accounting for 41.8% of total loans outstanding as of December 31, 2024[126]. - Non-performing loans totaled $7,874,000 as of December 31, 2024, slightly up from $7,622,000 in 2023[135]. Capital and Equity - Stockholders' equity increased to $213.508 million in 2024 from $181.070 million in 2023[98]. - The Tier 1 Capital to risk-adjusted assets ratio improved to 12.35% in 2024, up from 11.99% in 2023[98]. - The total risk-based capital ratio as of December 31, 2024, was 13.45%, up from 13.06% in 2023[164]. - Total stockholders' equity as of December 31, 2024, was $213.5 million, an increase from $181.1 million in 2023, primarily due to $28.1 million in net proceeds from an offering[164]. Interest Income and Expenses - Fully taxable equivalent net interest income for 2024 totaled $63,010,000, an increase of $194,000 from 2023, with a net interest spread of 2.17% compared to 2.47% in the previous year[150][154]. - Total interest expense rose to $50,389,000 in 2024, with an average cost of interest-bearing liabilities increasing to 3.07% from 2.21% in 2023[156]. - The net interest margin on a tax-equivalent basis for 2024 was 2.91%, down from 3.06% in 2023[168]. - Average loans outstanding increased by $80.5 million in 2024, contributing to an increase in interest income of $14.3 million[150]. - Total interest-earning assets increased to $17,110,000 in 2024, up from $6,773,000 in 2023, primarily driven by a $9,550,000 increase in loans receivable[172]. Securities and Investments - The securities portfolio was valued at $397.8 million, with unrealized losses of $33.5 million as of December 31, 2024[136]. - The average life of the securities portfolio was 7.1 years, with purchases totaling $208.1 million during the year[137]. - The Company held 215 investment securities in a loss position as of December 31, 2024, with a combined unrealized loss of $42.6 million, primarily due to changes in interest rates[140]. - The Company repositioned its available-for-sale debt securities portfolio, selling securities with an amortized cost of approximately $175 million and recognizing a pre-tax loss of $20 million[141]. Deposits and Liquidity - Total deposits as of December 31, 2024, were $1.859 billion, an increase of $64.0 million from the previous year, with time deposits increasing by $58.4 million[147]. - Non-interest bearing demand deposits decreased to $381.5 million in 2024 from $399.5 million in 2023[148]. - The company's liquidity as of December 31, 2024, was $470.1 million, representing 20.3% of total assets, down from 21.5% in 2023[186]. - The company maintained established lines of credit totaling $192.0 million, with $178.5 million outstanding as of December 31, 2024[187]. Taxation - The effective tax rate for 2024 was 38.0%, compared to 20.7% in 2023, with an income tax benefit of $98,000 in 2024[152]. - The effective tax rate for 2024 was 38.0%, compared to an income tax expense of $4,387,000 and a rate of 20.7% in 2023[163]. Interest Rate Sensitivity - The sensitivity analysis indicated that a 200-basis point increase in interest rates would decrease net interest income by 5.1% in year 1 and 2.7% in year 2[180]. - The yield on U.S. Treasury 5-year notes increased by 54 basis points from 3.84% to 4.38% during the year[179]. - The effective duration of the bond portfolio remained steady at 5.5 years as of December 31, 2024[181]. - The company’s asset and liability management aims to maintain a strong, stable net interest margin while effectively utilizing capital[174].

Group 1 - Susan Campfield announced her retirement from the Board of Directors of Norwood Financial Corp and Wayne Bank, effective February 18, 2025, after 19 years of service [1] - Campfield joined the Board in 2006 and has been a significant figure in the Wayne County business community, serving as President and CEO of Gumble Brothers, Inc. for over 33 years [1] - Her expertise in the local construction market contributed valuable insights into the local economy and business opportunities for the bank during her tenure [1] Group 2 - Norwood Financial Corp is the parent company of Wayne Bank, which operates thirty offices across Northeastern Pennsylvania and Upstate New York, including brands like Bank of Cooperstown and Bank of the Finger Lakes [2] - The company's stock is traded on the Nasdaq Global Market under the symbol "NWFL" [2]

Financial Performance - Norwood Financial Corp reported a net loss of $12.7 million for Q4 2024, a decrease of $13 million compared to the same period last year, primarily due to a one-time $20 million loss on the sale of securities[6]. - Adjusted net income for Q4 2024 was $3.1 million, significantly higher than $355 thousand in Q4 2023[5]. - The net loss for the twelve months ended December 31, 2024, was $(160) thousand, a significant decrease from the net income of $16,759 thousand in 2023[15]. - Basic loss per share for 2024 was $(0.02), compared to earnings per share of $2.08 in 2023[15]. - The net loss for the three months ended December 31, 2024, was $12,651,000, compared to a net loss of $3,559,000 for the same period in 2023, indicating a significant increase in losses[16]. - Basic loss per share for Q4 2024 was $1.54, compared to earnings of $0.04 per share in the same quarter last year[18]. Income and Expenses - Net interest income for Q4 2024 was $16.6 million, an increase of 8.7% from $15.3 million in Q4 2023[2]. - Total non-interest expenses rose to $48.6 million in 2024, up from $43.5 million in 2023, mainly due to higher compensation and data processing costs[6]. - Other income showed a significant decline, resulting in a total of $(11,151) thousand for the twelve months ended December 31, 2024, compared to $8,124 thousand in 2023[15]. - Total other expenses increased to $48,625 thousand in 2024, up from $43,497 thousand in 2023, an increase of 11.8%[15]. Assets and Liabilities - Total assets increased to $2.317 billion as of December 31, 2024, compared to $2.201 billion at the end of 2023[6]. - Total assets increased to $2,317,462 thousand in 2024 from $2,201,079 thousand in 2023, representing a growth of 5.3%[14]. - Net loans receivable rose to $1,693,795 thousand in 2024, up from $1,584,650 thousand in 2023, an increase of 6.9%[14]. - Total deposits grew to $1,859,163 thousand in 2024, compared to $1,795,159 thousand in 2023, reflecting a 3.6% increase[14]. - The allowance for credit losses was $19,843,000, compared to $18,968,000 in the previous year, indicating a slight increase in provisions[16]. Interest Income and Margin - Interest income for the twelve months ended December 31, 2024, was $112,580 thousand, up 17.8% from $95,540 thousand in 2023[15]. - Net interest income after provision for credit losses increased to $59,518 thousand in 2024, compared to $56,519 thousand in 2023, a rise of 5.3%[15]. - Total interest income for Q4 2024 was $29,485 thousand, up 12.5% from $26,085 thousand in Q4 2023[18]. - Net interest income after provision for credit losses was $15,021 thousand, compared to $9,177 thousand in the same quarter last year, reflecting a year-over-year increase of 63.5%[18]. - The net interest margin improved to 3.04% in Q4 2024, up 11 basis points from 2.93% in Q4 2023[6]. Capital and Equity - Tangible common equity increased to 8.05% as of December 31, 2024, compared to 6.98% at the end of 2023[6]. - The equity to total assets ratio improved to 9.21% from 8.23% year-over-year, suggesting a stronger capital position[16]. Future Outlook - The company completed a capital raise to reposition its investment portfolio, which is expected to improve future yields[3]. - The company anticipates that the repositioned portfolio will enhance future performance amid changing interest rates[2].

Core Insights - Norwood Financial Corp reported a net loss of $12.7 million for Q4 2024, primarily due to a one-time $20 million loss from the repositioning of its investment portfolio [2][4][17] - The company successfully raised capital to enhance its investment portfolio's yield, which is expected to improve future performance despite the current loss [2][3] - Net interest income increased to $16.6 million in Q4 2024, up from $15.3 million in Q4 2023, indicating a year-over-year growth [4][16] Financial Performance - For the three months ended December 31, 2024, net interest income was $16,625 thousand, compared to $15,293 thousand in the same period of 2023, reflecting a year-over-year increase of $1,332 thousand [4][16] - The net interest margin improved to 3.04% in Q4 2024 from 2.93% in Q4 2023, while the net interest spread increased to 2.31% from 2.23% [4][16] - Total assets as of December 31, 2024, were $2.317 billion, up from $2.201 billion a year earlier, with loans receivable growing to $1.694 billion [4][12][16] Adjusted Financial Metrics - Adjusted net income for Q4 2024 was $3,119 thousand, significantly higher than $355 thousand in Q4 2023, while adjusted diluted earnings per share rose to $0.38 from $0.04 [6][11] - The adjusted return on average assets for Q4 2024 was 0.54%, up from 0.06% in Q4 2023, and the adjusted return on tangible equity was 7.59%, compared to 1.01% in the prior year [6][10] Capital and Equity - The company’s stockholders' equity increased to $213.5 million as of December 31, 2024, from $181.1 million a year prior, reflecting a stronger capital position [4][12] - Tangible common equity ratio improved to 8.05% at the end of 2024, compared to 6.98% at the end of 2023 [4][12] Loan and Deposit Growth - Loans grew at an annualized rate of 9% during Q4 2024, indicating strong demand for credit [3] - Total deposits reached $1.859 billion as of December 31, 2024, compared to $1.795 billion a year earlier, showing a positive trend in customer deposits [4][12]

Core Viewpoint - Norwood Financial Corp has announced a public offering of 1,000,000 shares of common stock at a price of $26.00 per share, aiming for gross proceeds of approximately $26 million [1][2]. Group 1: Offering Details - The company has granted underwriters a 30-day option to purchase an additional 150,000 shares, which could increase total gross proceeds to approximately $30 million if fully exercised [2]. - The offering is expected to close around December 19, 2024, subject to customary conditions [2]. Group 2: Use of Proceeds - Net proceeds from the offering will be used to invest in the bank subsidiary to support capital ratios, reposition a substantial portion of the available-for-sale debt securities portfolio, and for general corporate purposes, including stock repurchase and potential acquisitions [3]. Group 3: Underwriters - Piper Sandler & Co. is the lead book-running manager for the offering, while Janney Montgomery Scott LLC is acting as the joint book-running manager [4]. Group 4: Company Background - Norwood Financial Corp is the parent company of Wayne Bank, operating 14 offices in Northeastern Pennsylvania and 15 offices in New York [9].