Orrstown Financial Services, Inc. reported significant financial changes in its 10-Q filing for the three and nine months ended September 30, 2024, primarily influenced by its recent merger with Codorus Valley Bancorp, Inc. The merger, completed on July 1, 2024, involved the issuance of 8,532,038 common shares valued at approximately $233.4 million, which contributed to a substantial increase in total assets and shareholders' equity.

For the third quarter of 2024, total interest income surged to $82.99 million, up from $38.69 million in the same period of 2023. Net interest income also rose significantly to $51.70 million from $26.22 million year-over-year. However, the company reported a net loss of $7.90 million for Q3 2024, contrasting with a net income of $9.03 million in Q3 2023. This loss was attributed to $17 million in merger-related expenses and a $15.5 million provision for credit losses on acquired loans.

For the nine months ended September 30, 2024, net income was $8.37 million, down from $28.02 million in the same period of 2023. The diluted loss per share for Q3 2024 was $(0.41), compared to earnings of $0.87 in Q3 2023. The diluted earnings per share for the nine months ended September 30, 2024, was $0.60, down from $2.68 in the prior year.

Total noninterest income for Q3 2024 increased to $12.39 million from $5.93 million in Q3 2023, driven by higher wealth management income and service charges. Conversely, total noninterest expenses rose sharply to $60.30 million from $20.45 million, largely due to merger-related costs and increased salaries and benefits.

The company’s loan portfolio expanded significantly, totaling $3.98 billion as of September 30, 2024, compared to $2.30 billion at the end of 2023. This growth was primarily due to the merger and increased commercial lending activity. Nonaccrual loans increased to $26.93 million, representing 0.68% of gross loans, up from 0.98% a year earlier.

Orrstown's total deposits reached $4.65 billion, a substantial increase from $2.56 billion at the end of 2023, reflecting the deposits assumed from the merger. The company maintained a strong capital position, with total shareholders' equity of $516.2 million as of September 30, 2024, up from $243.1 million at the end of 2023.

Overall, while Orrstown Financial Services experienced growth in interest income and deposits, the impact of merger-related expenses and credit loss provisions led to a net loss for the quarter. The company continues to focus on integrating Codorus Valley and enhancing its market presence in Pennsylvania and Maryland.