Mid Penn Bancorp Reports $4.8 Million Net Income in Q2 2025, Down from $11.8 Million Last Year

Mid Penn Bancorp, Inc. reported a net income of $4.8 million, or $0.22 per share, for the second quarter of 2025, a significant decrease from $11.8 million, or $0.71 per share, in the same period last year. For the first half of 2025, net income totaled $18.5 million, down from $23.9 million in the prior year. The decline in profitability was attributed to increased noninterest expenses, primarily due to merger-related costs associated with the acquisition of William Penn Bancorp, which was completed on April 30, 2025. The net interest margin improved to 3.44% from 3.12% year-over-year, reflecting a favorable shift in interest rates and asset mix.

Total assets for Mid Penn increased by 16.2% to $6.4 billion as of June 30, 2025, compared to $5.5 billion at the end of 2024. This growth was primarily driven by the acquisition of William Penn, which added approximately $727.7 million in assets, including $405.3 million in loans. Total loans rose to $4.8 billion, an 8.8% increase from $4.4 billion at the end of 2024, with notable contributions from residential mortgages and commercial real estate loans. Deposits also saw a substantial increase, rising by 16.2% to $5.4 billion, bolstered by $619.8 million in deposits from the William Penn acquisition.

Mid Penn's allowance for credit losses (ACL) on loans stood at $37.6 million, or 0.78% of total loans, slightly down from 0.80% at the end of 2024. The provision for credit losses increased to $2.6 million for the first half of 2025, driven by a $2.3 million reserve established for non-Purchased Credit Deteriorated (PCD) loans acquired in the William Penn transaction. Nonperforming assets rose to $28 million, reflecting an increase in non-accrual loans and foreclosed real estate, primarily due to two commercial real estate loans that were foreclosed during the quarter.

Strategically, Mid Penn has expanded its footprint through the acquisition of William Penn, which included 12 branches in Pennsylvania and New Jersey, enhancing its market presence. Additionally, the company acquired Charis Insurance Group for $4 million in May 2025, further diversifying its service offerings. The total number of employees increased as a result of these acquisitions, contributing to higher salaries and benefits expenses, which rose by 33.6% year-over-year.

Looking ahead, Mid Penn anticipates continued growth in its loan and deposit portfolios, supported by its recent acquisitions. The company remains focused on integrating the newly acquired entities and optimizing its operations to enhance profitability. However, management acknowledges potential challenges, including regulatory changes and economic conditions that could impact future performance.