Company: NWFL
Filing Date: 2025-10-28
Form Type: 424B3
Source: 0001193125-25-252482
Chunk: 82

Company: NORWOOD FINANCIAL CORP
Filing Date: 2025-10-28
Form: 424B3
Chunk 82
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2023. The increase in the average balance of loans was due
primarily to an increase in the average balances of commercial real estate loans and commercial and industrial loans reflecting our strategy to grow commercial lending. In addition, the increase in interest income on loans was also due to a 36 basis
points increase in the average yield on loans from 5.34% for 2023 to 5.70% for 2024 due to the higher interest rate environment.

Interest
and dividend income on securities and restricted stock increased $139,000, or 13.3%, to $1.2 million for 2024 from $1.0 million for 2023. The increase in interest income on debt and equity securities of $108,000, or 12.4%, to $977,000 for
2024 from $869,000 for 2023 was due to a 26 basis points increase in the average yield on debt and equity securities to 2.61% in 2024 from 2.35% in 2023 and an increase in the average balance of debt and equity securities of $344,000, or 0.9%, to
$37.4 million in 2024 from $37.0 million in 2023. The average yield on debt and equity securities increased due to investing in higher yielding corporate bonds in 2024. The increase in the average balance of debt and equity securities was
due to purchases of corporate bonds in community bank issuers, an additional CRA investment in the mortgage-backed securities portfolio and short-term treasury securities with excess liquidity. Restricted stock income increased $31,000, or 17.6%, to
$207,000 for 2024 from $176,000 for 2023 due to a 147 basis points increase in the average yield on restricted stocks to 8.76% for 2024 from 7.29% for 2023, partially offset by a decrease in the average balance of restricted stocks of $48,000, or
2.0%. The increase in average yield on restricted stock was due to the Federal Home Loan Bank dividend being increased in 2024 and the average balance decreased for 2024 due to the decrease in average borrowings.

49

Interest income on cash and cash equivalents increased $1.0 million, to
$2.8 million in 2024, from $1.8 million in 2023. The increase in interest income on cash and cash