Orrstown Financial Services, Inc. and Codorus Valley Bancorp, Inc. Announce Receipt of Regulatory Approvals for Merger of Equals
Orrstown Financial Services and Codorus Valley Bancorp have received regulatory approvals and waivers from the Federal Reserve and the Pennsylvania Department of Banking and Securities for their merger of equals. The merger, announced previously, is expected to close on July 1, 2024, subject to customary closing conditions.
Orrstown Financial Services is the parent company of Orrstown Bank, which offers various financial services across Pennsylvania, Maryland, and select areas in Virginia and West Virginia. Codorus Valley Bancorp, the largest independent financial services holding company in York, Pennsylvania, operates through its subsidiary, PeoplesBank, providing consumer, business, wealth management, and mortgage services in South Central Pennsylvania and Central Maryland.
- Regulatory approvals for the merger received from both the Federal Reserve and Pennsylvania Department of Banking and Securities.
- Merger expected to close on July 1, 2024, subject to customary closing conditions.
- Orrstown Financial Services operates in multiple counties across Pennsylvania, Maryland, Virginia, and West Virginia.
- Codorus Valley Bancorp is the largest independent financial services holding company in York, Pennsylvania.
- No specific financial benefits or cost savings from the merger outlined in the PR.
- Potential integration challenges post-merger not addressed.
Insights
Merger of Equals between Orrstown Financial Services, Inc. and Codorus Valley Bancorp, Inc. holds substantial implications for investors. This type of transaction typically promises cost synergies, expanded market reach and potentially higher profitability. For instance, the combined entity will likely leverage economies of scale, which can reduce overhead costs and improve efficiency.
However, investors should be aware of the risks involved. Integration can be challenging and achieving the anticipated synergies is not guaranteed. It's important to monitor how well the two companies merge their operations and cultures over time.
Financially, both stocks might witness increased volatility in the short term due to the inherent risks and uncertainties tied to mergers. Long-term prospects, though, look more promising if the integration goes smoothly. The combined entity could benefit from a stronger competitive position in the financial services market, particularly in South Central Pennsylvania and Central Maryland.
This merger significantly impacts the regional banking market in Pennsylvania and Maryland. By merging, Orrstown and Codorus Valley can consolidate their market presence, making them more formidable competitors against larger national banks. This regional dominance could potentially attract more customers seeking personalized banking services.
Additionally, the merger is likely to enhance the product and service offerings of both institutions, benefiting existing and new customers. This could lead to increased customer satisfaction and loyalty, essential factors for long-term success in the banking industry.
However, potential customers might have concerns during the integration period, such as changes to their banking experience or disruptions in service. Clear communication and effective change management will be critical to maintaining customer trust and minimizing attrition.
The receipt of regulatory approvals from the Federal Reserve System and the Pennsylvania Department of Banking and Securities is a important step in any merger. It signifies that the transaction has met all necessary regulatory requirements, which include assessments of antitrust issues, financial stability and compliance with banking laws.
From a legal perspective, this approval reduces the risk of the merger being blocked or delayed by regulatory bodies, providing a clearer path to the completion of the transaction. It also indicates that both companies have robust compliance frameworks, which is a positive sign for long-term operational stability.
Investors should note, however, that while regulatory approval is a significant milestone, the merger's success will ultimately depend on its execution. Close attention should be paid to how the integration of the two entities unfolds, particularly in areas like corporate governance, employee retention and operational harmonization.
SHIPPENSBURG, Pa. and YORK, Pa., June 17, 2024 (GLOBE NEWSWIRE) -- Orrstown Financial Services, Inc. (“Orrstown”) (NASDAQ: ORRF), the parent company of Orrstown Bank, and Codorus Valley Bancorp, Inc. (“Codorus Valley”) (NASDAQ: CVLY), the parent company of PeoplesBank, A Codorus Valley Company, today announced that they have received the requisite regulatory approvals and waivers from the Board of Governors of the Federal Reserve System and the Pennsylvania Department of Banking and Securities for their previously announced merger of equals. The parties anticipate closing the transaction on July 1, 2024, subject to the satisfaction of customary closing conditions.
About Orrstown
Orrstown Financial Services, Inc. and its wholly owned subsidiary, Orrstown Bank, provide a wide range of consumer and business financial services in Adams, Berks, Cumberland, Dauphin, Franklin, Lancaster, Perry, and York Counties, Pennsylvania and Anne Arundel, Baltimore, Howard, and Washington Counties, Maryland, as well as Baltimore City, Maryland. The Company’s lending area also includes adjacent counties in Pennsylvania and Maryland, as well as Loudon County, Virginia and Berkeley, Jefferson and Morgan Counties, West Virginia. Orrstown Bank is an Equal Housing Lender and its deposits are insured up to the legal maximum by the FDIC. Orrstown Financial Services, Inc.’s common stock is traded on the NASDAQ Global Select Market under the symbol “ORRF”.
About Codorus Valley
Codorus Valley Bancorp, Inc. is the largest independent financial services holding company headquartered in York, Pennsylvania. Codorus Valley primarily operates through its financial services subsidiary, PeoplesBank, A Codorus Valley Company. PeoplesBank offers a full range of consumer, business, wealth management, and mortgage services at financial centers located in communities throughout South Central Pennsylvania and Central Maryland. Codorus Valley Bancorp, Inc.’s Common Stock is listed on the NASDAQ Global Market under the symbol “CVLY”.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 regarding the financial condition, results of operations, business plans and the future performance of Orrstown and Codorus Valley.
Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “projects,” “could,” “may,” “should,” “will” or other similar words and expressions are intended to identify these forward-looking statements. These forward-looking statements are based on Orrstown’s and Codorus Valley’s current expectations and assumptions regarding Orrstown’s and Codorus Valley’s businesses, the economy, and other future conditions. Because forward-looking statements relate to future results and occurrences, they are subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict. Any number of risks, uncertainties, or other factors could affect Orrstown’s or Codorus Valley’s future financial results and performance and could cause actual results or performance to differ materially from anticipated results or performance. Such risks and uncertainties include, among others: the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the definitive agreement and plan of merger between Orrstown and Codorus Valley; the outcome of any legal proceedings that may be instituted against Orrstown or Codorus Valley; delays in completing the proposed transaction; the failure to satisfy any conditions to the proposed transaction on a timely basis or at all, including the ability of Orrstown and Codorus Valley to meet expectations regarding the timing, completion and accounting and tax treatments of the proposed transaction; the possibility that the anticipated benefits of the proposed transaction are not realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where Orrstown and Codorus Valley do business; the possibility that the proposed transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; the possibility that revenues following the proposed transaction may be lower than expected; the impact of certain restrictions during the pendency of the proposed transaction on the parties’ ability to pursue certain business opportunities and strategic transactions; diversion of management’s attention from ongoing business operations and opportunities; potential adverse reactions or changes to business or employee relationships, including those resulting from the announcement or completion of the proposed transaction; the ability to complete the proposed transaction and integration of Orrstown and Codorus Valley successfully; the dilution caused by Orrstown’s issuance of additional shares of its capital stock in connection with the proposed transaction; and the potential impact of general economic, political or market factors on the companies or the proposed transaction and other factors that may affect future results of Orrstown or Codorus Valley. The foregoing list of factors is not exhaustive. Except to the extent required by applicable law or regulation, each of Orrstown and Codorus Valley disclaims any obligation to update such factors or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments. Further information regarding Orrstown, Codorus Valley and factors which could affect the forward-looking statements contained herein can be found in Orrstown’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, its Quarterly Report on Form 10-Q for the period ended March 31, 2024, and its other filings with the SEC, and in Codorus Valley’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, its Quarterly Report on Form 10-Q for the period ended March 31, 2024, and its other filings with the SEC. SEC filings are available free of charge on the SEC’s website at www.sec.gov.
For media inquiries or further information, please contact:
John Moss
SVP, Director of Marketing and Client Experience, PeoplesBank, A Codorus Valley Company
717-747-1520
jmoss@peoplesbanknet.com
Matthew Dyckman
EVP, General Counsel, Orrstown Bank
717-510-7262
mdyckman@orrstown.com
FAQ
What merger involving CVLY received regulatory approval?
When is the merger between Orrstown Financial Services and Codorus Valley Bancorp expected to close?
Which regulatory bodies approved the merger of CVLY and ORRF?
Which companies are involved in the merger of equals announced on June 17, 2024?
