Company: NWFL
Filing Date: 2025-10-08
Form Type: S-4/A
Source: 0001193125-25-234244
Chunk: 72

Company: NORWOOD FINANCIAL CORP
Filing Date: 2025-10-08
Form: S-4/A
Chunk 72
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 and industrial loan portfolios, to improve our interest rate risk exposure and increase interest income. Our primary market area now consists of Chester and Lancaster Counties
and the surrounding Pennsylvania counties of Cumberland, Dauphin, and Lebanon. Management has also emphasized the importance of attracting commercial deposit accounts from its customers. As a result of these initiatives, we were able to increase our
consolidated assets by $11.6 million, or 2.6%, from $439.7 million at December 31, 2023 to $451.3 million at December 31, 2024 and increase our deposits $21.2 million, or 6.4%, from $333.0 million at
December 31, 2023 to $354.2 million at December 31, 2024.

Our results of operations depend primarily on our net interest
income and, to a lesser extent, noninterest income. Net interest income is the difference between the interest income we earn on our interest-earning assets, consisting primarily of loans, debt securities and other interest-earning assets (primarily
cash and cash equivalents), and the interest we pay on our interest-bearing liabilities, consisting primarily of savings accounts, demand accounts, money market accounts, certificates of deposit and borrowings. Noninterest income on a recurring
basis consists primarily of debit card income, service charges on deposit accounts, earnings on bank owned life insurance, other service charges and other income. Our results of operations also are affected by our provision for credit losses and
noninterest expense. Noninterest expense consists primarily of salaries and

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employee benefits, occupancy and equipment, data and item processing costs, advertising and marketing, professional fees, directors’ fees, FDIC insurance premiums, Pennsylvania shares tax,
debit card expenses, and other expenses. Our results of operations also may be affected significantly by general and local economic and competitive conditions, changes in market interest rates, government policies and actions of regulatory
authorities.

For the year ended December 31, 2024, we had net income of $1.8 million compared to net income of
$1.9 million for the year ended December 31, 2023. The year over year decrease in earnings of $147,000 was attributable to a decrease in net interest income and an increase in noninterest expense, partially offset by a
decrease in the provision for credit losses, an increase in noninterest income and a decrease in income tax expense. Net interest income decreased $1.0 million due to