A Pennsylvania bank is closing 11 offices in Indiana as part of a broader network streamlining effort.
Warren-based Northwest Bank acquired the offices as part of its merger with MutualBank earlier this year. They are in Bloomington, Carmel, Fort Wayne, Goshen, Greenwood, Muncie, South Bend, Warsaw, Lyons, Mitchell and Mishawaka. An additional 25 offices that were part of the acquisition will remain open.
Northwest plans to close a total of 42 out of its 205 full-service offices, or approximately 20 percent, throughout its footprint, one free-standing drive-through and one business office during the week of Dec. 14-18. Other branches being closed are in New York, Ohio and Pennsylvania.
Northwest will have $12 million in pre-tax costs which are expected to be recognized during the second half of 2020. The annual reduction in pre-tax operating expenses beginning in 2021 are estimated to be approximately $13 million.
“Our customers’ banking preferences continue to evolve to favor a more digital banking experience and the COVID-19 pandemic has magnified and accelerated these preferences,” said Ronald Seiffert, chair, president and CEO of the $14 billion Northwest. “This branch optimization plan reflects our ongoing efforts to ensure we are well positioned in our industry to provide the community bank experience that is valued by our customer base while also enhancing our strong digital and mobile banking presence.”
Northwest posted a net loss of $6.2 million in the second quarter, compared to income of $7.9 million in the first quarter and $26.4 million a year prior. The loss largely came from increased loan loss reserves of about $21.3 million, as well as provision expense of about $18.2 million and about $9.7 million in costs associated with the MutualBank deal, Seiffert said.