Executive Summary

Eastern PA is a banking market dominated by large institutions headquartered elsewhere both in the U.S. and in foreign countries. Our featured region ranges from the heavily populated Delaware Valley in the southeast and extends northward through the Lehigh Valley to the Pocono Mountains.

This report highlights the 18 publicly-traded banks in Eastern PA with assets between $600M and $10B.

We believe community banks in this size range are large enough to operate efficiently and small enough to deliver personalized services. These “under the radar” stocks are not widely followed by brokerages or institutional investors for several reasons, including small market caps and little trading volume.

The coronavirus pandemic impacts all economic activity and nearly every aspect of life throughout the U.S., including our highlighted market. On June 5, most of Eastern PA is scheduled to emerge from state government-mandated lockdowns with all “nonessential” businesses restricted (red phase) to a less limited environment (yellow phase). Businesses with employees working from home must continue to do so under the yellow phase. We believe that, in general, the coronavirus pandemic will accentuate the divide between “haves” and “have nots” and hasten the evolution and/or demise of many industries and companies already struggling to compete effectively in the technology-driven 21st Century. Community banks are part of this “survival of the fittest” challenge; and thus, must consider strategies such as expanding niche-focused business models, better uses of fintech, and/or pursuing M&A transactions in order to thrive.


  • Due to its greater population density, there are more community banks in Eastern Pennsylvania versus Central and Western Pennsylvania. Although stock prices of all banks have been thumped, the trading multiples of our highlighted banks vary considerably. In addition to a broad range of individual company financial performance, banks in economically vibrant markets tend to command higher trading multiples in normal times.
  • As of March 31, 2020, the highlighted banks generally had strong balance sheets that reflect adequate asset quality, solid funding, and acceptable capital ratios. First quarter earnings for community banks across the U.S. were inconclusive as the vast majority did not provide guidance given the high degree of uncertainty caused by the coronavirus.
  • We believe net interest margins will be overshadowed by changes in credit quality and loan loss provisioning. Net interest margins for individual banks will be more erratic and depend more upon the size of the PPP, loan deferrals, and nonperforming assets.

For more information, please visit pnc.com/fig or contact PNC FIG Advisory by calling 1-610-351-1633.