Orrstown Financial Services is planning to shed six branches as it seeks to wring cost savings from its recent merger of equals with PeoplesBank parent Codorus Valley Bancorp.
The closures, expected to take place in the fourth quarter, will result in a one-time pre-tax charge of $534,000 but yield annual pre-tax savings of about $1.7 million, according to a securities filing this week.
In a statement, Orrstown president and CEO Tom Quinn said the bank is “making every effort to offer suitable positions to affected employees within the bank.”
“Although the decision to close a branch is never an easy decision to make for any organization, it is important to our long-term success to operate in the most efficient manner possible, delivering banking services through evolving client preferences,” Quinn said. “While the Orrstown Bank and PeoplesBank branch network is highly complementary, there are some instances where branches currently serve the same local area.”
The Orrstown-Codorus Valley merger closed last month. Branches are continuing to operate under their respective brand names until November, when they will all take the Orrstown name.
Where are the branches: In Cumberland, Lancaster and York counties, as well as in Parkton, Maryland. They are all PeoplesBank branches, at:
- 2343 Oregon Pike in Manheim Township, Lancaster County.
- 3002 Hempland Road in East Hempfield Township, Lancaster County.
- 3100 Market St. in Camp Hill.
- Bethany Village retirement community in Lower Allen Township, Cumberland County.
- 6 Baltimore St. in Jefferson, York County.
- 211 Mt. Carmel Road in Parkton.
The background: The merged Orrstown has assets of about $5.2 billion and a headquarters in Swatara Township, Dauphin County.
Following the branch closures, the bank will have 38 full-service branches and seven limited-service offices in Central Pennsylvania and northern Maryland.
The trend: Other local banks also have been trimming their branch networks this year.
The moves are partly in response to consumers opting more often for digital banking channels, but also to the financial pressures stemming from higher interest rates and rising costs.
Following its acquisition earlier this year of a Philadelphia-area lender, Lancaster-based Fulton Financial is closing 19 branches, a tally that includes one temporarily closed branch in Philadelphia that will not reopen.
