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Dec 31, 2023
Peoples Financial Q4 2023 Earnings Report
Reported decreased earnings due to higher deposit costs and increased provision for credit losses.
Key Takeaways
Peoples Financial Services Corp. reported a net income of $3.6 million, or $0.51 per diluted share, for Q4 2023. This represents a 60.3% decrease compared to the $9.1 million, or $1.27 per diluted share, reported for the same period in 2022. The decrease was attributed to lower net interest income, a higher provision for credit losses, and increased operating expenses, partially offset by higher noninterest income.
Net income decreased 60.3% to $3.6 million, or $0.51 per diluted share.
Net interest income decreased due to higher deposit costs.
Provision for credit losses increased by $3.8 million.
Operating expenses increased, mainly due to acquisition-related expenses.
Forward Guidance
Peoples Financial Services Corp. is planning to strategically combine with FNCB Bancorp, Inc. The proposed strategic combination is expected to close in the first half of 2024.
Positive Outlook
- Strategic combination that creates a bank holding company with nearly $5.5 billion in assets.
- #2 ranked deposit market share in the Scranton-Wilkes Barre metro statistical area
- #5 ranked Pennsylvania-headquartered community bank under $20 billion in total assets.
- Projected to deliver estimated 59% earnings per share (“EPS”) accretion to Peoples in 2025, inclusive of all merger synergies
- A 51% dividend increase to Peoples shareholders.
Challenges Ahead
- The proposed strategic combination may be substantially more expensive to complete than originally anticipated.
- The anticipated benefits may be significantly harder-or take longer-to achieve than expected.
- Regulatory delays or other regulatory issues could negatively impact the merger.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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