Norwood Financial Corp Reports Increased Net Income and Announces Merger with PB Bankshares

Norwood Financial Corp reported a significant increase in financial performance for the second quarter of 2025, with net income rising to $6.2 million, up from $4.2 million in the same period last year. This translates to earnings per share of $0.67, compared to $0.52 in the prior year. The company's net interest income also saw a notable increase, reaching $19.1 million, a rise of 27.5% from $14.9 million in the previous year. The increase in net interest income was primarily driven by a $3.5 million rise in total interest income, attributed to a larger loan portfolio and improved interest rates.

Total assets for Norwood Financial Corp increased to $2.365 billion as of June 30, 2025, compared to $2.317 billion at the end of 2024. This growth was largely due to a $75.9 million increase in loans receivable, which reached $1.770 billion. The company reported a slight increase in the allowance for credit losses, totaling $20.9 million, representing 1.17% of total loans, compared to 1.16% at the end of 2024. Non-performing loans also increased marginally to $8.1 million, or 0.45% of total loans, from $7.9 million, or 0.46%, at the end of the previous year.

In terms of strategic developments, Norwood Financial Corp announced a merger agreement with PB Bankshares, Inc., which is expected to enhance its market presence and operational capabilities. The merger will see PB Bankshares merge into Norwood Financial Corp, with the latter as the surviving entity. This strategic move is anticipated to be completed in the fourth quarter of 2025 or the first quarter of 2026, pending regulatory approvals.

Operationally, the company reported a total deposit increase of $138.7 million, driven by a rise in interest-bearing demand deposits and certificates of deposit. As of June 30, 2025, total deposits stood at $1.998 billion, compared to $1.859 billion at the end of 2024. The company also maintained a strong liquidity position, with cash and cash equivalents totaling $53.0 million, alongside securities available for sale valued at $402.5 million.

Looking ahead, Norwood Financial Corp expressed optimism regarding its growth trajectory, bolstered by the anticipated benefits from the merger with PB Bankshares and a solid loan growth strategy. The company remains focused on managing interest rate risks and maintaining adequate capital levels to support its operations and growth initiatives.