0000716605False00007166052023-07-252023-07-25

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
 
FORM 8-K
 
CURRENT REPORT
 
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
October 25, 2023 
Date of Report (Date of earliest event reported)
 
PENNS WOODS BANCORP, INC.
(Exact name of registrant as specified in its charter)
Pennsylvania 000-17077 23-2226454
(State or other jurisdiction
of incorporation)		 (Commission
File Number)		 (IRS Employer
Ident. No.)
 
300 Market StreetP.O. Box 96717703-0967
WilliamsportPennsylvania(Zip Code)
(Address of principal executive offices)
 
(570) 322-1111
Registrant's telephone number, including area code
 
N/A
(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:
 
☐ 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))

Securities registered pursuant to Section 12(b) of the Exchange Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, $5.55 par valuePWODThe Nasdaq Global Select Market
Indicated by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2) ☐
If an emerging growth company, indicate by check mark if registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐


Item 2.02                                           Results of Operation and Financial Condition.
 
On October 25, 2023, Penns Woods Bancorp, Inc. (the “Company”) distributed a press release announcing its earnings for the period ended September 30, 2023.  The press release is attached as Exhibit 99.1 hereto and incorporated herein by reference.

Item 9.01                                           Financial Statements and Exhibits.

(d)                                 Exhibits:

99.1        Press release, dated October 25, 2023, of Penns Woods Bancorp, Inc. announcing earnings for the period ended September 30, 2023.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 PENNS WOODS BANCORP, INC.
   
Dated:October 25, 2023  
   
 By:/s/  Brian L. Knepp
  Brian L. Knepp
  President and Chief Financial Officer
 

EXHIBIT INDEX
 
Exhibit Number Description
 Press release, dated October 25, 2023, of Penns Woods Bancorp, Inc. announcing earnings for the period ended September 30, 2023.
104Cover page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document).



Exhibit 99.1
image0a17a.jpg

Press Release — For Immediate Release
October 25, 2023

Penns Woods Bancorp, Inc. Reports Third Quarter 2023 Earnings

Williamsport, PA — October 25, 2023 - Penns Woods Bancorp, Inc. (NASDAQ: PWOD)

Penns Woods Bancorp, Inc. achieved net income of $11.1 million for the nine months ended September 30, 2023, resulting in basic and diluted earnings per share of $1.56 and $1.53.

Highlights

•Net income, as reported under GAAP, for the three and nine months ended September 30, 2023 was $2.2 million and $11.1 million, compared to $5.3 million and $12.9 million for the same periods of 2022. Results for the three and nine months ended September 30, 2023 compared to 2022 were impacted by a decrease in net interest income of $2.2 million and $1.2 million as interest expense increased significantly due to the velocity and magnitude of the rate increases enacted by the Federal Open Market Committee ("FOMC"). In addition, results were impacted by a decrease in after-tax securities losses of $77,000 (from a loss of $167,000 to a loss of $90,000) for the three month period and a decrease in after-tax securities losses of $106,000 (from a loss of $258,000 to a loss of $152,000) for the nine month period. Bank-owned life insurance income increased due to a gain on death benefit of $380,000 during the nine months ended September 30, 2023, while an after-tax loss of $201,000 related to a branch closure negatively impacted the nine months ended September 30, 2022.

•The provision for credit losses increased $537,000 for the three months ended September 30, 2023 and decreased $1.1 million for the nine months ended September 30, 2023 due to a provision of $1.4 million and $263,000, respectively, for the 2023 periods compared to a provision of $835,000 and $1.3 million for the 2022 periods. The decrease for the nine month periods was due primarily to a recovery on a commercial loan during the second quarter of 2023. The increase in the provision for credit losses for the 2023 three month period was due primarily to loan portfolio growth as loan portfolio credit metrics continue to improve and loan net charge-offs remain at a low level.

•Basic earnings per share for the three and nine months ended September 30, 2023 were $0.31 and $1.56, while the diluted earnings per share were $0.31 and $1.53 for the periods. Basic and diluted earnings per share for the three and nine months ended September 30, 2022 were $0.74 and $1.83.

•Annualized return on average assets was 0.41% for three months ended September 30, 2023, compared to 1.09% for the corresponding period of 2022. Annualized return on average assets was 0.70% for the nine months ended September 30, 2023, compared to 0.89% for the corresponding period of 2022.

•Annualized return on average equity was 5.06% for the three months ended September 30, 2023, compared to 12.61% for the corresponding period of 2022. Annualized return on average equity was 8.58% for the nine months ended September 30, 2023, compared to 10.48% for the corresponding period of 2022.

Net Income

Net income from core operations (“core earnings”), which is a non-generally accepted accounting principles (GAAP) measure of net income excluding net securities gains or losses, was $2.3 million and $11.2 million for the three and nine months ended September 30, 2023 compared to $5.4 million and $13.2 million for the same periods of 2022. Basic core earnings per share for the three and nine months ended September 30, 2023 was $0.33 and $1.59, while the diluted core earnings per share was $0.32 and $1.55, compared to $0.77 and $1.87 basic and diluted core earnings per share for the same periods of 2022. Annualized core return on average assets and core return on average equity were 0.43% and 5.26% for the three months ended September 30, 2023, compared to 1.12% and 13.02% for the corresponding periods of 2022. Core return on average assets and core return on average
1

equity were 0.71% and 8.69% for the nine months ended September 30, 2023 compared to 0.91% and 10.69% for the corresponding periods of 2022. A reconciliation of the non-GAAP financial measures of core earnings, core return on assets, core return on equity, and core earnings per share described in this press release to the comparable GAAP financial measures is included at the end of this press release.


Net Interest Margin

The net interest margin for the three and nine months ended September 30, 2023 was 2.65% and 2.82%, compared to 3.47% and 3.17% for the corresponding periods of 2022. The decrease in the net interest margin for the three and nine month periods was driven by an increase in the rate paid on interest-bearing liabilities of 239 and 189 basis points ("bps"), respectively. The FOMC rate increases during 2022 and 2023 contributed to the increases in rate paid on interest-bearing liabilities as the rate paid on short-term borrowings increased 429 bps and 467 bps for the three and nine month periods ended September 30, 2023 compared to the same periods of 2022. Short-term borrowings increased in volume and rate paid as this funding source was utilized to provide funding for the growth in the loan portfolio, resulting in an increase of $2.4 million and $6.1 million in expense for the three and nine month periods ended September 30, 2023 compared to the same periods of 2022. The rate paid on interest-bearing deposits increased 207 and 154 bps for the three and nine month periods ended September 30, 2023 compared to the corresponding periods of 2022 due to the FOMC rate actions and an increase in competition for deposits. The rates paid on time deposits significantly contributed to the increase in funding costs as rates paid for the three and nine month periods ended September 30, 2023 compared to the same periods of 2022 increased 328 bps and 259 bps, respectively, as deposit gathering campaigns initiated in the latter part of 2022 continued throughout 2023. In addition, brokered deposits have been utilized to assist with the funding of the loan portfolio growth and contributed to the increase in time deposit funding costs. Partially offsetting the increase in funding cost was an increase in the yield on interest-earning assets and growth in the average balance of the earning asset portfolio compared to the same periods in 2022. The average loan portfolio balance increased $276.8 million and $278.2 million for the three and nine month periods, respectively, as the average yield on the portfolio increased 87 and 76 bps for the same periods. The three and nine month periods ended September 30, 2023 were impacted by an increase of 113 and 101 bps in the yield earned on the securities portfolio as legacy securities matured with the funds reinvested at higher rates.

Assets

Total assets increased to $2.2 billion at September 30, 2023, an increase of $271.4 million compared to September 30, 2022.  Net loans increased $260.1 million to $1.8 billion at September 30, 2023 compared to September 30, 2022, as an emphasis was placed on commercial loan growth coupled with growth in indirect auto lending. The investment portfolio increased $7.2 million from September 30, 2022 to September 30, 2023 as restricted investment in bank stock increased $10.8 million resulting from the requirement to hold additional stock in the Federal Home Loan Bank of Pittsburgh ("FHLB") due to an increase in the level of borrowings from the FHLB. The increase in total borrowings of $277.7 million to $411.4 million at September 30, 2023 was utilized to provide funding for the growth in the loan portfolio.

Non-performing Loans

The ratio of non-performing loans to total loans ratio decreased to 0.20% at September 30, 2023 from 0.37% at September 30, 2022, as non-performing loans decreased to $3.7 million at September 30, 2023 from $5.7 million at September 30, 2022. The majority of non-performing loans involve loans that are either in a secured position and have sureties with a strong underlying financial position or have been classified as individually evaluated loans that have a specific allocation recorded within the allowance for credit losses. Net loan recoveries of $316,000 for the nine months ended September 30, 2023 impacted the allowance for credit losses, which was 0.71% of total loans at September 30, 2023 compared to 0.97% at September 30, 2022 (prior to the adoption of CECL).

Deposits

Deposits decreased $23.1 million to $1.6 billion at September 30, 2023 compared to September 30, 2022. Noninterest-bearing deposits decreased $65.9 million to $471.5 million at September 30, 2023 compared to September 30, 2022.  Core deposits declined as deposits migrated from core deposit accounts into time deposits as market rates increased due to the FOMC rate increases and increased competition for deposits. Core deposit gathering efforts remained focused on increasing the utilization of electronic (internet and mobile) deposit banking by our customers. Interest-bearing deposits increased $42.7 million from September 30, 2022 to September 30, 2023 primarily due to increased utilization of brokered deposits of $101.2 million as this funding source was utilized to supplement funding loan portfolio growth, while reducing the need to draw upon available borrowing lines. A campaign to attract time deposits with a maturity of five to twenty-four months commenced during the latter part of 2022 and has continued during the first nine months of 2023 with current efforts centered on five to twelve months.

2

Shareholders’ Equity

Shareholders’ equity increased $10.1 million to $174.5 million at September 30, 2023 compared to September 30, 2022.  During the three months ended September 30, 2023 the Company sold 34,411 shares of common stock, for net proceeds of $752,000, in a registered at-the-market offering. An additional 8,349 shares for net proceeds of $200,000 were issued as part of the Dividend Reinvestment Plan during the three months ended September 30, 2023. Accumulated other comprehensive loss of $14.9 million at September 30, 2023 increased from a loss of $14.6 million at September 30, 2022 as a result of a $10.9 million net unrealized loss on available for sale securities at September 30, 2023 compared to an unrealized loss of $11.1 million at September 30, 2022 coupled with an increase in loss of $607,000 in the defined benefit plan obligation. The current level of shareholders’ equity equates to a book value per share of $24.55 at September 30, 2023 compared to $23.32 at September 30, 2022, and an equity to asset ratio of 8.02% at September 30, 2023 and 8.63% at September 30, 2022. Dividends declared for the nine months ended September 30, 2023 and 2022 were $0.96 per share.

Penns Woods Bancorp, Inc. is the parent company of Jersey Shore State Bank, which operates sixteen branch offices providing financial services in Lycoming, Clinton, Centre, Montour, Union, and Blair Counties, and Luzerne Bank, which operates eight branch offices providing financial services in Luzerne County, and United Insurance Solutions, LLC, which offers insurance products.  Investment and insurance products are offered through Jersey Shore State Bank’s subsidiary, The M Group, Inc. D/B/A The Comprehensive Financial Group.

NOTE:  This press release contains financial information determined by methods other than in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”).  Management uses the non-GAAP measure of net income from core operations in its analysis of the company’s performance. This measure, as used by the Company, adjusts net income determined in accordance with GAAP to exclude the effects of special items, including significant gains or losses that are unusual in nature such as net securities gains and losses. Because these certain items and their impact on the Company’s performance are difficult to predict, management believes presentation of financial measures excluding the impact of such items provides useful supplemental information in evaluating the operating results of the Company’s core businesses. These disclosures should not be viewed as a substitute for net income determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

This press release may contain certain “forward-looking statements” including statements concerning plans, objectives, future events or performance and assumptions and other statements, which are statements other than statements of historical fact.  The Company cautions readers that the following important factors, among others, may have affected and could in the future affect actual results and could cause actual results for subsequent periods to differ materially from those expressed in any forward-looking statement made by or on behalf of the Company herein: (i) the effect of changes in laws and regulations, including federal and state banking laws and regulations, and the associated costs of compliance with such laws and regulations either currently or in the future as applicable; (ii) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies as well as by the Financial Accounting Standards Board, or of changes in the Company’s organization, compensation and benefit plans; (iii) the effect on the Company’s competitive position within its market area of the increasing consolidation within the banking and financial services industries, including the increased competition from larger regional and out-of-state banking organizations as well as non-bank providers of various financial services; (iv) the effect of changes in interest rates; (v) the effects of health emergencies, including the spread of infectious diseases or pandemics; or (vi) the effect of changes in the business cycle and downturns in the local, regional or national economies.  For a list of other factors which could affect the Company’s results, see the Company’s filings with the Securities and Exchange Commission, including “Item 1A.  Risk Factors,” set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022.

You should not place undue reliance on any forward-looking statements.  These statements speak only as of the date of this press release, even if subsequently made available by the Company on its website or otherwise.  The Company undertakes no obligation to update or revise these statements to reflect events or circumstances occurring after the date of this press release.
Previous press releases and additional information can be obtained from the Company’s website at www.pwod.com.
Contact:Richard A. Grafmyre, Chief Executive Officer
 110 Reynolds Street
 Williamsport, PA 17702
 570-322-1111e-mail: pwod@pwod.com

3

PENNS WOODS BANCORP, INC.
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
 
 September 30,
(In Thousands, Except Share and Per Share Data)20232022% Change
ASSETS:   
Noninterest-bearing balances$26,651 $24,418 9.14 %
Interest-bearing balances in other financial institutions8,939 12,444 (28.17)%
Total cash and cash equivalents35,590 36,862 (3.45)%
Investment debt securities, available for sale, at fair value184,667 188,196 (1.88)%
Investment equity securities, at fair value1,072 1,130 (5.13)%
Restricted investment in bank stock, at fair value 25,289 14,539 73.94 %
Loans held for sale4,083 2,485 64.31 %
Loans1,818,461 1,560,700 16.52 %
Allowance for credit losses(12,890)(15,211)(15.26)%
Loans, net1,805,571 1,545,489 16.83 %
Premises and equipment, net30,746 32,227 (4.60)%
Accrued interest receivable10,500 8,647 21.43 %
Bank-owned life insurance33,695 34,288 (1.73)%
Investment in limited partnerships8,275 4,771 73.44 %
Goodwill16,450 17,104 (3.82)%
Intangibles235 361 (34.90)%
Operating lease right of use asset2,562 2,699 (5.08)%
Deferred tax asset6,961 7,187 (3.14)%
Other assets10,772 9,131 17.97 %
TOTAL ASSETS$2,176,468 $1,905,116 14.24 %
LIABILITIES:   
Interest-bearing deposits$1,095,760 $1,053,012 4.06 %
Noninterest-bearing deposits471,507 537,403 (12.26)%
Total deposits1,567,267 1,590,415 (1.46)%
Short-term borrowings193,746 30,901 526.99 %
Long-term borrowings217,645 102,829 111.66 %
Accrued interest payable2,716 427 536.07 %
Operating lease liability2,619 2,753 (4.87)%
Other liabilities17,935 13,302 34.83 %
TOTAL LIABILITIES2,001,928 1,740,627 15.01 %
SHAREHOLDERS’ EQUITY:   
Preferred stock, no par value, 3,000,000 shares authorized; no shares issued— — n/a
Common stock, par value $5.55, 22,500,000 shares authorized; 7,620,250 and 7,563,200 shares issued; 7,110,025 and 7,052,975 shares outstanding42,335 42,019 0.75 %
Additional paid-in capital55,890 53,958 3.58 %
Retained earnings104,067 95,896 8.52 %
Accumulated other comprehensive loss:  
Net unrealized loss on available for sale securities(10,886)(11,125)2.15 %
Defined benefit plan(4,051)(3,444)(17.62)%
Treasury stock at cost, 510,225(12,815)(12,815)— %
TOTAL SHAREHOLDERS' EQUITY174,540 164,489 6.11 %
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$2,176,468 $1,905,116 14.24 %
4

PENNS WOODS BANCORP, INC.
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
Three Months Ended September 30,Nine Months Ended September 30,
(In Thousands, Except Share and Per Share Data)20232022% Change20232022% Change
INTEREST AND DIVIDEND INCOME:      
Loans including fees$21,720 $15,051 44.31 %$59,571 $41,709 42.83 %
Investment securities:     
Taxable1,365 949 43.84 %3,870 2,550 51.76 %
Tax-exempt114 236 (51.69)%410 594 (30.98)%
Dividend and other interest income722 628 14.97 %1,827 1,470 24.29 %
TOTAL INTEREST AND DIVIDEND INCOME23,921 16,864 41.85 %65,678 46,323 41.78 %
INTEREST EXPENSE:      
Deposits6,463 693 832.61 %14,686 2,191 570.29 %
Short-term borrowings2,412 26 n/m6,084 29 n/m
Long-term borrowings1,714 613 179.61 %3,892 1,871 108.02 %
TOTAL INTEREST EXPENSE10,589 1,332 694.97 %24,662 4,091 502.84 %
NET INTEREST INCOME13,332 15,532 (14.16)%41,016 42,232 (2.88)%
Provision for loan credit losses1,331 855 55.67 %726 1,335 (45.62)%
Provision (recovery) for off balance sheet credit exposures41 — n/a(463)— n/a
TOTAL PROVISION FOR CREDIT LOSSES 1,372 855 60.47 %263 1,335 (80.30)%
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES11,960 14,677 (18.51)%40,753 40,897 (0.35)%
NON-INTEREST INCOME:     
Service charges545 559 (2.50)%1,557 1,563 (0.38)%
Debt securities losses, available for sale(78)(156)50.00 %(158)(168)5.95 %
Net equity securities losses(36)(55)34.55 %(35)(158)77.85 %
Bank-owned life insurance170 170 — %892 501 78.04 %
Gain on sale of loans290 294 (1.36)%.765 905 (15.47)%
Insurance commissions136 109 24.77 %416 386 7.77 %
Brokerage commissions142 142 — %448 500 (10.40)%
Loan broker income241 438 (44.98)%728 1,350 (46.07)%
Debit card income320 344 (6.98)%995 1,080 (7.87)%
Other145 238 (39.08)%546 673 (18.87)%
TOTAL NON-INTEREST INCOME1,875 2,083 (9.99)%6,154 6,632 (7.21)%
NON-INTEREST EXPENSE:      
Salaries and employee benefits6,290 6,016 4.55 %18,778 18,421 1.94 %
Occupancy784 730 7.40 %2,422 2,380 1.76 %
Furniture and equipment867 816 6.25 %2,503 2,454 2.00 %
Software amortization237 188 26.06 %593 660 (10.15)%
Pennsylvania shares tax280 334 (16.17)%807 1,119 (27.88)%
Professional fees719 626 14.86 %2,313 1,746 32.47 %
Federal Deposit Insurance Corporation deposit insurance425 260 63.46 %1,122 690 62.61 %
Marketing167 151 10.60 %594 435 36.55 %
Intangible amortization25 34 (26.47)%92 119 (22.69)%
Other1,378 1,165 18.28 %4,275 3,723 14.83 %
TOTAL NON-INTEREST EXPENSE11,172 10,320 8.26 %33,499 31,747 5.52 %
INCOME BEFORE INCOME TAX PROVISION2,663 6,440 (58.65)%13,408 15,782 (15.04)%
INCOME TAX PROVISION439 1,190 (63.11)%2,355 2,869 (17.92)%
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS'$2,224 $5,250 (57.64)%$11,053 $12,913 (14.40)%
EARNINGS PER SHARE - BASIC $0.31 $0.74 (58.11)%$1.56 $1.83 (14.75)%
EARNINGS PER SHARE - DILUTED$0.31 $0.74 (58.11)%$1.53 $1.83 (16.39)%
WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC7,072,440 7,051,228 0.30 %7,064,336 7,060,871 0.05 %
WEIGHTED AVERAGE SHARES OUTSTANDING - DILUTED7,228,940 7,051,228 2.52 %7,220,836 7,060,871 2.27 %


5

PENNS WOODS BANCORP, INC.
AVERAGE BALANCES AND INTEREST RATES 
(UNAUDITED)
 Three Months Ended
 September 30, 2023September 30, 2022
(Dollars in Thousands)
Average 
Balance (1)
InterestAverage 
Rate
Average 
Balance (1)
InterestAverage 
Rate
ASSETS:      
Tax-exempt loans (3)
$68,243 $462 2.69 %$58,735 $394 2.66 %
All other loans1,730,669 21,355 4.90 %1,463,330 14,740 4.00 %
Total loans (2)
1,798,912 21,817 4.81 %1,522,065 15,134 3.94 %
Federal funds sold— — — %33,641 218 2.57 %
Taxable securities193,019 1,945 4.09 %159,721 1,158 2.94 %
Tax-exempt securities (3)
20,777 144 2.81 %49,177 299 2.47 %
Total securities213,796 2,089 3.96 %208,898 1,457 2.83 %
Interest-bearing balances in other financial institutions11,868 142 4.75 %34,202 201 2.33 %
Total interest-earning assets2,024,576 24,048 4.72 %1,798,806 17,010 3.76 %
Other assets131,451 130,576   
TOTAL ASSETS$2,156,027   $1,929,382   
LIABILITIES AND SHAREHOLDERS’ EQUITY:      
Savings$225,357 181 0.32 %$249,083 26 0.04 %
Super Now deposits244,387 1,174 1.91 %405,173 287 0.28 %
Money market deposits294,006 1,862 2.51 %287,660 200 0.28 %
Time deposits342,450 3,246 3.76 %148,968 180 0.48 %
Total interest-bearing deposits1,106,200 6,463 2.32 %1,090,884 693 0.25 %
Short-term borrowings173,364 2,412 5.52 %8,062 26 1.23 %
Long-term borrowings204,901 1,714 3.32 %109,269 613 2.23 %
Total borrowings378,265 4,126 4.33 %117,331 639 2.16 %
Total interest-bearing liabilities1,484,465 10,589 2.83 %1,208,215 1,332 0.44 %
Demand deposits471,494 533,681  
Other liabilities24,193 21,008  
Shareholders’ equity175,875 166,478  
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$2,156,027  $1,929,382  
Interest rate spread (3)
  1.89 %  3.32 %
Net interest income/margin (3)
 $13,459 2.65 % $15,678 3.47 %
1.    Information on this table has been calculated using average daily balance sheets to obtain average balances.
2.    Non-accrual loans have been included with loans for the purpose of analyzing net interest earnings.
3.    Income and rates on fully taxable equivalent basis include an adjustment for the difference between annual income     
from tax-exempt obligations and the taxable equivalent of such income at the standard tax rate of 21%
Three Months Ended September 30,
 20232022
Total interest income$23,921 $16,864 
Total interest expense10,589 1,332 
Net interest income (GAAP)13,332 15,532 
Tax equivalent adjustment127 146 
Net interest income (fully taxable equivalent) (non-GAAP)$13,459 $15,678 
6

PENNS WOODS BANCORP, INC.
AVERAGE BALANCES AND INTEREST RATES 
(UNAUDITED)
Nine Months Ended
 September 30, 2023September 30, 2022
(Dollars in Thousands)
Average 
Balance (1)
InterestAverage 
Rate
Average 
Balance (1)
InterestAverage 
Rate
ASSETS:      
Tax-exempt loans (3)
$66,372 $1,371 2.76 %$53,269 $1,033 2.59 %
All other loans1,668,596 58,488 4.69 %1,403,504 40,893 3.90 %
Total loans (2)
1,734,968 59,859 4.61 %1,456,773 41,926 3.85 %
Federal funds sold— — — %43,938 465 1.41 %
Taxable securities188,477 5,331 3.78 %152,937 3,126 2.76 %
Tax-exempt securities (3)
25,837 519 2.69 %45,357 752 2.24 %
Total securities214,314 5,850 3.65 %198,294 3,878 2.64 %
Interest-bearing balances in other financial institutions10,619 366 4.61 %97,520 429 0.59 %
Total interest-earning assets1,959,901 66,075 4.41 %1,796,525 46,698 3.48 %
Other assets132,133  129,048  
TOTAL ASSETS$2,092,034  $1,925,573  
LIABILITIES AND SHAREHOLDERS’ EQUITY:    
Savings$233,784 456 0.26 %$246,063 72 0.04 %
Super Now deposits293,636 3,026 1.38 %388,149 721 0.25 %
Money market deposits292,490 4,807 2.20 %296,998 596 0.27 %
Time deposits264,855 6,397 3.23 %167,876 802 0.64 %
Total interest-bearing deposits1,084,765 14,686 1.81 %1,099,086 2,191 0.27 %
Short-term borrowings155,136 6,084 5.26 %6,308 29 0.59 %
Long-term borrowings169,276 3,892 3.07 %112,457 1,871 2.22 %
Total borrowings324,412 9,976 4.12 %118,765 1,900 2.14 %
Total interest-bearing liabilities1,409,177 24,662 2.34 %1,217,851 4,091 0.45 %
Demand deposits484,662  519,599  
Other liabilities26,334  23,814  
Shareholders’ equity171,861  164,309  
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$2,092,034  $1,925,573  
Interest rate spread (3)
  2.07 %  3.03 %
Net interest income/margin (3)
 $41,413 2.82 % $42,607 3.17 %
1.    Information on this table has been calculated using average daily balance sheets to obtain average balances.
2.    Non-accrual loans have been included with loans for the purpose of analyzing net interest earnings.
3.    Income and rates on fully taxable equivalent basis include an adjustment for the difference between annual income     
from tax-exempt obligations and the taxable equivalent of such income at the standard tax rate of 21%
Nine Months Ended September 30,
 20232022
Total interest income$65,678 $46,323 
Total interest expense24,662 4,091 
Net interest income41,016 42,232 
Tax equivalent adjustment397 375 
Net interest income (fully taxable equivalent) (non-GAAP)$41,413 $42,607 
7


(Dollars in Thousands, Except Per Share Data, Unaudited)Quarter Ended
9/30/20236/30/20233/31/202312/31/20229/30/2022
Operating Data 
Net income$2,224$4,171$4,658$4,509$5,250
Net interest income13,33213,38614,29815,54815,532
Provision (recovery) for credit losses1,372(1,180)71575855
Net security losses(114)(39)(40)(39)(211)
Non-interest income, excluding net security losses1,9892,0612,2972,1202,294
Non-interest expense11,17211,42910,89811,25110,320
Performance Statistics
Net interest margin2.65 %2.77 %3.10 %3.42 %3.47 %
Annualized return on average assets0.41 %0.80 %0.92 %0.92 %1.09 %
Annualized return on average equity5.06 %9.53 %11.12 %10.92 %12.61 %
Annualized net loan charge-offs (recoveries) to average loans0.01 %(0.11)%0.03 %0.04 %0.01 %
Net charge-offs (recoveries)33(472)12314937
Efficiency ratio72.76 %73.78 %65.46 %59.79 %57.70 %
Per Share Data
Basic earnings per share$0.31$0.59$0.66$0.64$0.74
Diluted earnings per share0.310.590.640.640.74
Dividend declared per share0.320.320.320.320.32
Book value24.5524.7024.6423.7623.32
Common stock price:
High27.1727.3427.7726.8924.29
Low20.7021.9521.9023.1522.02
Close21.0825.0323.1026.6222.91
Weighted average common shares: 
Basic7,0727,0627,0587,0557,051
Fully Diluted7,2297,0627,3347,0557,051
End-of-period common shares:
Issued7,6207,5747,5707,5677,563
Treasury(510)(510)(510)(510)(510)
8

(Dollars in Thousands)Quarter Ended
9/30/20236/30/20233/31/202312/31/20229/30/2022
Financial Condition Data:     
General     
Total assets$2,176,468$2,135,319$2,065,143$2,000,080$1,905,116
Loans, net1,805,5711,757,8111,688,2891,624,0941,545,489
Goodwill16,45016,45016,45016,45017,104
Intangibles235260292327361
Total deposits1,567,2671,553,7571,638,8351,556,4601,590,415
Noninterest-bearing471,507475,937502,352519,063537,403
Savings226,897229,108239,526247,952249,532
NOW220,730238,353363,548372,574392,140
Money Market291,889296,957300,273270,589268,532
Time Deposits249,550226,224191,203137,949137,348
Brokered Deposits106,69487,17841,9338,3335,460
Total interest-bearing deposits1,095,7601,077,8201,136,4831,037,3971,053,012
Core deposits*1,211,0231,240,3551,405,6991,410,1781,447,607
Shareholders’ equity174,540174,402173,970167,665164,489
Asset Quality
Non-performing loans$3,683$4,276$4,766$4,890$5,743
Non-performing loans to total assets0.17 %0.20 %0.23 %0.24 %0.30 %
Allowance for loan losses12,89011,59211,73415,63715,211
Allowance for loan losses to total loans0.71 %0.66 %0.69 %0.95 %0.97 %
Allowance for loan losses to non-performing loans
349.99 %271.09 %246.20 %319.78 %264.86 %
Non-performing loans to total loans0.20 %0.24 %0.28 %0.30 %0.37 %
Capitalization
Shareholders’ equity to total assets8.02 %8.17 %8.42 %8.40 %8.63 %

* Core deposits are defined as total deposits less time deposits and brokered deposits.
9

Reconciliation of GAAP and Non-GAAP Financial Measures
(UNAUDITED)
Three Months Ended September 30,Nine Months Ended September 30,
(Dollars in Thousands, Except Per Share Data)2023202220232022
GAAP net income$2,224$5,250$11,053$12,913
Net securities losses, net of tax90167152258
Non-GAAP core earnings$2,314$5,417$11,205$13,171
 Three Months Ended September 30,Nine Months Ended September 30,
 2023202220232022
Return on average assets (ROA)0.41 %1.09 %0.70 %0.89 %
Net securities losses, net of tax0.02 %0.03 %0.01 %0.02 %
Non-GAAP core ROA0.43 %1.12 %0.71 %0.91 %
 Three Months Ended September 30,Nine Months Ended September 30,
 2023202220232022
Return on average equity (ROE)5.06 %12.61 %8.58 %10.48 %
Net securities losses, net of tax0.20 %0.41 %0.11 %0.21 %
Non-GAAP core ROE5.26 %13.02 %8.69 %10.69 %
 Three Months Ended September 30,Nine Months Ended September 30,
 2023202220232022
Basic earnings per share (EPS)$0.31$0.74$1.56$1.83
Net securities losses, net of tax0.020.030.030.04
Non-GAAP basic core EPS$0.33$0.77$1.59$1.87
 Three Months Ended September 30,Nine Months Ended September 30,
 2023202220232022
Diluted EPS$0.31$0.74$1.53$1.83
Net securities losses, net of tax0.010.030.020.04
Non-GAAP diluted core EPS$0.32$0.77$1.55$1.87




10
v3.23.3
Cover Document
Jul. 25, 2023
Cover [Abstract]  
Title of 12(b) Security Common stock, $5.55 par value
City Area Code (570)
Entity Address, Address Line One 300 Market Street
Entity Incorporation, State or Country Code PA
Entity Registrant Name PENNS WOODS BANCORP, INC.
Document Type 8-K
Document Period End Date Oct. 25, 2023
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Entity File Number 000-17077
Entity Tax Identification Number 23-2226454
Entity Address, Address Line Two P.O. Box 967
Entity Address, Postal Zip Code 17703-0967
Entity Address, City or Town Williamsport
Entity Address, State or Province PA
Local Phone Number 322-1111
Trading Symbol PWOD
Security Exchange Name NASDAQ
Entity Central Index Key 0000716605
Amendment Flag false
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