Date of Report (Date of earliest event reported)
|
April 19, 2017
|
Norwood Financial Corp.
|
(Exact name of registrant as specified in its charter)
|
Pennsylvania
|
0-28364
|
23-2828306
|
(State or other jurisdiction
of incorporation)
|
(Commission
File Number)
|
(IRS Employer
Identification No.)
|
717 Main Street, Honesdale, Pennsylvania
|
18431
|
(Address of principal executive offices)
|
(Zip Code)
|
Registrant's telephone number, including area code:
|
(570) 253-1455
|
Not Applicable
|
(Former name or former address, if changed since last report)
|
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
|
|
☐
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
☐
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
☐
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
☐
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)).
|
NORWOOD FINANCIAL CORP.
|
|||
Date: April 19, 2017
|
By:
|
/s/ Lewis J. Critelli
|
|
Lewis J. Critelli
President and Chief Executive Officer
(Duly Authorized Representative)
|
(dollars in thousands)
|
Three months ended March 31,
|
|||||||
2017
|
2016
|
|||||||
Net interest income
|
$
|
8,497
|
$
|
6,175
|
||||
Tax equivalent basis adjustment using 34% marginal tax rate
|
546
|
359
|
||||||
Net interest income on a fully taxable equivalent basis
|
$
|
9,043
|
$
|
6,534
|
NORWOOD FINANCIAL CORP.
|
||||||||
Consolidated Balance Sheets
|
||||||||
(dollars in thousands, except share data)
|
||||||||
(unaudited)
|
||||||||
March 31
|
||||||||
2017
|
2016
|
|||||||
ASSETS
|
||||||||
Cash and due from banks
|
$
|
12,057
|
$
|
8,709
|
||||
Interest-bearing deposits with banks
|
7,785
|
254
|
||||||
Cash and cash equivalents
|
19,842
|
8,963
|
||||||
Securities available for sale
|
295,801
|
143,948
|
||||||
Loans receivable
|
719,443
|
565,787
|
||||||
Less: Allowance for loan losses
|
6,901
|
7,642
|
||||||
Net loans receivable
|
712,542
|
558,145
|
||||||
Regulatory stock, at cost
|
1,939
|
2,982
|
||||||
Bank premises and equipment, net
|
13,073
|
6,390
|
||||||
Bank owned life insurance
|
36,352
|
18,951
|
||||||
Foreclosed real estate owned
|
4,703
|
2,855
|
||||||
Accrued interest receivable
|
3,532
|
2,487
|
||||||
Goodwill
|
11,331
|
9,715
|
||||||
Other intangible assets
|
571
|
260
|
||||||
Deferred tax asset
|
8,923
|
3,456
|
||||||
Other assets
|
3,006
|
1,952
|
||||||
TOTAL ASSETS
|
$
|
1,111,615
|
$
|
760,104
|
||||
LIABILITIES
|
||||||||
Deposits:
|
||||||||
Non-interest bearing demand
|
$
|
192,735
|
$
|
113,225
|
||||
Interest-bearing
|
738,678
|
447,266
|
||||||
Total deposits
|
931,413
|
560,491
|
||||||
Short-term borrowings
|
28,383
|
52,672
|
||||||
Other borrowings
|
28,877
|
38,856
|
||||||
Accrued interest payable
|
909
|
925
|
||||||
Other liabilities
|
9,081
|
4,462
|
||||||
TOTAL LIABILITIES
|
998,663
|
657,406
|
||||||
STOCKHOLDERS' EQUITY
|
||||||||
Common Stock, $.10 par value, authorized 10,000,000 shares
|
||||||||
issued: 2017: 4,164,723 shares, 2016: 3,724,668 shares
|
416
|
373
|
||||||
Surplus
|
47,678
|
35,390
|
||||||
Retained earnings
|
68,268
|
66,143
|
||||||
Treasury stock, at cost: 2017: 2,566 shares, 2016: 35,649 shares
|
(93
|
)
|
(987
|
)
|
||||
Accumulated other comprehensive (loss) income
|
(3,317
|
)
|
1,779
|
|||||
TOTAL STOCKHOLDERS' EQUITY
|
112,952
|
102,698
|
||||||
TOTAL LIABILITIES AND
|
||||||||
STOCKHOLDERS' EQUITY
|
$
|
1,111,615
|
$
|
760,104
|
NORWOOD FINANCIAL CORP.
|
||||||||
Consolidated Statements of Income
|
||||||||
(dollars in thousands, except per share data)
|
||||||||
(unaudited)
|
||||||||
Three Months Ended March 31,
|
||||||||
2017
|
2016
|
|||||||
INTEREST INCOME
|
||||||||
Loans receivable, including fees
|
$
|
7,806
|
$
|
6,135
|
||||
Securities
|
1,618
|
890
|
||||||
Other
|
10
|
1
|
||||||
Total Interest income
|
9,434
|
7,026
|
||||||
INTEREST EXPENSE
|
||||||||
Deposits
|
766
|
581
|
||||||
Short-term borrowings
|
28
|
39
|
||||||
Other borrowings
|
143
|
231
|
||||||
Total Interest expense
|
937
|
851
|
||||||
NET INTEREST INCOME
|
8,497
|
6,175
|
||||||
PROVISION FOR LOAN LOSSES
|
600
|
450
|
||||||
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES
|
7,897
|
5,725
|
||||||
OTHER INCOME
|
||||||||
Service charges and fees
|
936
|
574
|
||||||
Income from fiduciary activities
|
106
|
102
|
||||||
Net realized gains on sales of securities
|
6
|
64
|
||||||
Gains on sales of loans, net
|
0
|
30
|
||||||
Earnings and proceeds on life insurance policies
|
255
|
167
|
||||||
Other
|
340
|
130
|
||||||
Total other income
|
1,643
|
1,067
|
||||||
OTHER EXPENSES
|
||||||||
Salaries and employee benefits
|
3,219
|
2,303
|
||||||
Occupancy, furniture and equipment
|
911
|
495
|
||||||
Data processing and related operations
|
344
|
271
|
||||||
Taxes, other than income
|
233
|
205
|
||||||
Professional fees
|
249
|
151
|
||||||
FDIC Insurance assessment
|
95
|
115
|
||||||
Foreclosed real estate
|
572
|
31
|
||||||
Other
|
991
|
778
|
||||||
Total other expenses
|
6,614
|
4,349
|
||||||
INCOME BEFORE TAX
|
2,926
|
2,443
|
||||||
INCOME TAX EXPENSE
|
550
|
567
|
||||||
NET INCOME
|
$
|
2,376
|
$
|
1,876
|
||||
Basic earnings per share
|
$
|
0.57
|
$
|
0.51
|
||||
Diluted earnings per share
|
$
|
0.57
|
$
|
0.51
|
NORWOOD FINANCIAL CORP.
|
||||||||
Financial Highlights (Unaudited)
|
||||||||
(dollars in thousands, except per share data)
|
||||||||
For the Three Months Ended March 31
|
2017
|
2016
|
||||||
Net interest income
|
$
|
8,497
|
$
|
6,175
|
||||
Net income
|
2,376
|
1,876
|
||||||
Net interest spread (fully taxable equivalent)
|
3.40
|
%
|
3.55
|
%
|
||||
Net interest margin (fully taxable equivalent)
|
3.51
|
%
|
3.70
|
%
|
||||
Return on average assets
|
0.87
|
%
|
1.00
|
%
|
||||
Return on average equity
|
8.54
|
%
|
7.33
|
%
|
||||
Basic earnings per share
|
$
|
0.57
|
$
|
0.51
|
||||
Diluted earnings per share
|
$
|
0.57
|
$
|
0.51
|
||||
As of March 31
|
||||||||
Total assets
|
$
|
1,111,615
|
$
|
760,104
|
||||
Total loans receivable
|
719,443
|
565,787
|
||||||
Allowance for loan losses
|
6,901
|
7,642
|
||||||
Total deposits
|
931,413
|
560,491
|
||||||
Stockholders' equity
|
112,952
|
102,698
|
||||||
Trust assets under management
|
143,055
|
133,421
|
||||||
Book value per share
|
$
|
27.09
|
$
|
27.88
|
||||
Tangible book value per share
|
$
|
24.18
|
$
|
25.18
|
||||
Equity to total assets
|
10.16
|
%
|
13.51
|
%
|
||||
Allowance to total loans receivable
|
0.96
|
%
|
1.35
|
%
|
||||
Nonperforming loans to total loans
|
0.28
|
%
|
1.21
|
%
|
||||
Nonperforming assets to total assets
|
0.60
|
%
|
1.28
|
%
|
NORWOOD FINANCIAL CORP.
|
||||||||||||||||||||
Consolidated Balance Sheets (unaudited)
|
||||||||||||||||||||
(dollars in thousands)
|
||||||||||||||||||||
March 31
|
December 31
|
September 30
|
June 30
|
March 31
|
||||||||||||||||
2017
|
2016
|
2016
|
2016
|
2016
|
||||||||||||||||
ASSETS
|
||||||||||||||||||||
Cash and due from banks
|
$
|
12,057
|
$
|
14,900
|
$
|
19,404
|
$
|
8,171
|
$
|
8,709
|
||||||||||
Interest-bearing deposits with banks
|
7,785
|
2,274
|
13,729
|
4,444
|
254
|
|||||||||||||||
Cash and cash equivalents
|
19,842
|
17,174
|
33,133
|
12,615
|
8,963
|
|||||||||||||||
Securities available for sale
|
295,801
|
302,564
|
310,126
|
129,721
|
143,948
|
|||||||||||||||
Loans receivable
|
719,443
|
713,889
|
706,199
|
581,220
|
565,787
|
|||||||||||||||
Less: Allowance for loan losses
|
6,901
|
6,463
|
6,164
|
5,798
|
7,642
|
|||||||||||||||
Net loans receivable
|
712,542
|
707,426
|
700,035
|
575,422
|
558,145
|
|||||||||||||||
Regulatory stock, at cost
|
1,939
|
2,119
|
2,351
|
2,228
|
2,982
|
|||||||||||||||
Bank owned life insurance
|
36,352
|
36,133
|
35,889
|
19,082
|
18,951
|
|||||||||||||||
Bank premises and equipment, net
|
13,073
|
13,531
|
13,617
|
6,328
|
6,390
|
|||||||||||||||
Foreclosed real estate owned
|
4,703
|
5,302
|
5,386
|
5,414
|
2,855
|
|||||||||||||||
Goodwill and other intangibles
|
11,902
|
12,291
|
12,331
|
9,952
|
9,975
|
|||||||||||||||
Other assets
|
15,461
|
14,643
|
12,189
|
7,067
|
7,895
|
|||||||||||||||
TOTAL ASSETS
|
$
|
1,111,615
|
$
|
1,111,183
|
$
|
1,125,057
|
$
|
767,829
|
$
|
760,104
|
||||||||||
.
|
.
|
|||||||||||||||||||
LIABILITIES
|
||||||||||||||||||||
Deposits:
|
||||||||||||||||||||
Non-interest bearing demand
|
$
|
192,735
|
$
|
191,445
|
$
|
200,481
|
$
|
121,743
|
$
|
113,225
|
||||||||||
Interest-bearing deposits
|
738,678
|
733,940
|
721,763
|
462,516
|
447,266
|
|||||||||||||||
Total deposits
|
931,413
|
925,385
|
922,244
|
584,259
|
560,491
|
|||||||||||||||
Other borrowings
|
57,260
|
64,812
|
83,946
|
74,679
|
91,528
|
|||||||||||||||
Other liabilities
|
9,990
|
9,907
|
3,167
|
4,300
|
5,387
|
|||||||||||||||
TOTAL LIABILITIES
|
998,663
|
1,000,104
|
1,009,357
|
663,238
|
657,406
|
|||||||||||||||
STOCKHOLDERS' EQUITY
|
112,952
|
111,079
|
115,700
|
104,591
|
102,698
|
|||||||||||||||
TOTAL LIABILITIES AND
|
||||||||||||||||||||
STOCKHOLDERS' EQUITY
|
$
|
1,111,615
|
$
|
1,111,183
|
$
|
1,125,057
|
$
|
767,829
|
$
|
760,104
|
NORWOOD FINANCIAL CORP.
|
||||||||||||||||||||
Consolidated Statements of Income (unaudited)
|
||||||||||||||||||||
(dollars in thousands, except per share data)
|
||||||||||||||||||||
March 31
|
December 31
|
September 30
|
June 30
|
March 31
|
||||||||||||||||
Three months ended
|
2017
|
2016
|
2016
|
2016
|
2016
|
|||||||||||||||
INTEREST INCOME
|
||||||||||||||||||||
Loans receivable, including fees
|
$
|
7,806
|
$
|
7,858
|
$
|
7,267
|
$
|
6,351
|
$
|
6,135
|
||||||||||
Securities
|
1,618
|
1,584
|
1,239
|
878
|
890
|
|||||||||||||||
Other
|
10
|
14
|
22
|
5
|
1
|
|||||||||||||||
Total interest income
|
9,434
|
9,456
|
8,528
|
7,234
|
7,026
|
|||||||||||||||
INTEREST EXPENSE
|
||||||||||||||||||||
Deposits
|
766
|
765
|
677
|
580
|
581
|
|||||||||||||||
Borrowings
|
171
|
240
|
281
|
260
|
270
|
|||||||||||||||
Total interest expense
|
937
|
1,005
|
958
|
840
|
851
|
|||||||||||||||
NET INTEREST INCOME
|
8,497
|
8,451
|
7,570
|
6,394
|
6,175
|
|||||||||||||||
PROVISION FOR LOAN LOSSES
|
600
|
450
|
450
|
700
|
450
|
|||||||||||||||
NET INTEREST INCOME AFTER PROVISION
|
||||||||||||||||||||
FOR LOAN LOSSES
|
7,897
|
8,001
|
7,120
|
5,694
|
5,725
|
|||||||||||||||
OTHER INCOME
|
||||||||||||||||||||
Service charges and fees
|
936
|
951
|
840
|
604
|
574
|
|||||||||||||||
Income from fiduciary activities
|
106
|
107
|
126
|
114
|
102
|
|||||||||||||||
Net realized gains on sales of securities
|
6
|
15
|
0
|
205
|
64
|
|||||||||||||||
Gains on sales of loans, net
|
0
|
0
|
(11
|
)
|
18
|
30
|
||||||||||||||
Earnings and proceeds on life insurance policies
|
255
|
272
|
283
|
166
|
167
|
|||||||||||||||
Other
|
340
|
145
|
161
|
116
|
130
|
|||||||||||||||
Total other income
|
1,643
|
1,490
|
1,399
|
1,223
|
1,067
|
|||||||||||||||
OTHER EXPENSES
|
||||||||||||||||||||
Salaries and employee benefits
|
3,219
|
3,308
|
3,070
|
2,248
|
2,303
|
|||||||||||||||
Occupancy, furniture and equipment, net
|
911
|
889
|
755
|
487
|
495
|
|||||||||||||||
Foreclosed real estate owned
|
572
|
98
|
119
|
432
|
31
|
|||||||||||||||
FDIC insurance assessment
|
95
|
10
|
170
|
117
|
115
|
|||||||||||||||
Merger related
|
0
|
142
|
1,659
|
5
|
-
|
|||||||||||||||
Other
|
1,817
|
2,121
|
1,906
|
1,239
|
1,405
|
|||||||||||||||
Total other expenses
|
6,614
|
6,568
|
7,679
|
4,528
|
4,349
|
|||||||||||||||
INCOME BEFORE TAX
|
2,926
|
2,923
|
840
|
2,389
|
2,443
|
|||||||||||||||
INCOME TAX EXPENSE
|
550
|
577
|
228
|
511
|
567
|
|||||||||||||||
NET INCOME
|
$
|
2,376
|
$
|
2,346
|
$
|
612
|
$
|
1,878
|
$
|
1,876
|
||||||||||
Basic earnings per share
|
$
|
0.57
|
$
|
0.57
|
$
|
0.15
|
$
|
0.51
|
$
|
0.51
|
||||||||||
Diluted earnings per share
|
$
|
0.57
|
$
|
0.56
|
$
|
0.15
|
$
|
0.51
|
$
|
0.51
|
||||||||||
Book Value per share
|
$
|
27.09
|
$
|
26.15
|
$
|
25.94
|
$
|
27.99
|
$
|
27.88
|
||||||||||
Tangible Book Value per share
|
24.18
|
23.51
|
24.89
|
24.13
|
25.18
|
|||||||||||||||
Return on average assets (annualized)
|
0.87
|
%
|
0.83
|
%
|
0.69
|
%
|
0.99
|
%
|
1.00
|
%
|
||||||||||
Return on average equity (annualized)
|
8.54
|
%
|
8.17
|
%
|
5.45
|
%
|
7.28
|
%
|
7.33
|
%
|
||||||||||
Net interest spread (fte)
|
3.40
|
%
|
3.38
|
%
|
3.37
|
%
|
3.63
|
%
|
3.55
|
%
|
||||||||||
Net interest margin (fte)
|
3.51
|
%
|
3.49
|
%
|
3.50
|
%
|
3.79
|
%
|
3.70
|
%
|
||||||||||
Allowance for loan losses to total loans
|
0.96
|
%
|
0.91
|
%
|
0.87
|
%
|
1.00
|
%
|
1.35
|
%
|
||||||||||
Net charge-offs to average loans (annualized)
|
0.09
|
%
|
0.09
|
%
|
0.05
|
%
|
1.78
|
%
|
0.08
|
%
|
||||||||||
Nonperforming loans to total loans
|
0.28
|
%
|
0.25
|
%
|
0.32
|
%
|
0.21
|
%
|
1.21
|
%
|
||||||||||
Nonperforming assets to total assets
|
0.60
|
%
|
0.64
|
%
|
0.68
|
%
|
0.86
|
%
|
1.28
|
%
|