Peoples Neighborhood Bank from Susquehanna County, flush with deposits from royalty owners and businesses engaged in all aspects of Marcellus development in the county, is moving up to compete with bigger banks in the cities of Binghamton and Scranton.
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Susquehanna County bank pushes into downtown Scranton
BY DAVID FALCHEK (STAFF WRITER)
Published: March 15, 2013
A Hallstead-based community bank is setting down roots in downtown Scranton, joining a competitive banking landscape.
The newest Peoples Neighborhood Bank office planned for Mulberry Street and Penn Avenue at the site of PDQ Print Center won’t be a full-fledged retail banking office. The modest 2,200-square-foot office will be for commercial lending and administration.
The Electric City outpost of the bank whose center of gravity is firmly in the Endless Mountains may eventually evolve into a branch with tellers and an ATM, said Joe Ferretti, Peoples Neighborhood Bank chief lending officer, but for now, the plans call for some administration function and commercial lending.
The bank hopes to use the office to set a new marker in its service area, Mr. Ferretti said, with a Binghamton, N.Y. branch to the north and now Scranton in the south.
The Federal Deposit Insurance Corp.’s approval for the office is still pending, but Mr. Ferretti is hoping to have the bank ready to lend in June.
The bank is doing business in Lackawanna and Luzerne counties, he said, and the hopes the office will help better serve those customers.
Banking observers say the move is as much about getting new customers as it is about serving existing customers.
The stable, if long sleepy, country bank has grown fast over the past four years, fueled by Marcellus Shale royalty deposits and related economic activity in the counties where it does business. One of the bank’s challenges has been lending out the money that comes in – the chief way banks earn money.
Fred Hickman, who led the Scranton-based North Penn Bank until its acquisition by Norwood Financial in 2011, said Peoples’ move into Scranton appears to be a wise one for the deposit-rich bank to put its assets to work.
“They are getting all this deposit money, and it’s difficult for them to put it out there safely in their current market area,” he said. “Why not try to do it in the biggest city in the Northeast?”
In the past two years, two other banks have set up commercial lending outposts in the Scranton. In 2011, Luzerne Bank opened a commercial loan office. Later that year, Franklin Security Bank set up a Scranton office with a commercial loan specialization.
The city is also home to many national and community banks, hosting the headquarters of the parent company of Penn Security Bank & Trust and the headquarters of Tobyhanna Federal Credit Union.
Daniel J. Santaniello, chief executive of Dunmore-based Fidelity D&D Bancorp, called the city “over-banked,” with more branches relative to the number of household that many other markets in the nation, a key reason why his bank consolidated two downtown offices three years ago.
Craig Best, chief executive officer at Penn Security, called Peoples a well-run, solid institution.
While bankers don’t welcome new competition, he said it will be good for customers and the area economy.
“This provides competition, keeps loan rates low, and makes money available where it the community needs it,” he said