Penns Woods Bancorp, Inc. (PWOD): History, Ownership, Mission, How It Works & Makes Money

When you analyze a regional player like Penns Woods Bancorp, Inc. (PWOD), are you looking at a stable community bank or a strategic acquisition target that delivered a significant return?

The answer is both, as the company, which managed $2.3 billion in total assets as of March 31, 2025, completed its $270.4 million all-stock merger with Northwest Bancshares, Inc. in July 2025, fundamentally redefining its market position.

This strategic exit, following a Q1 2025 net income of $7.4 million driven by an expanded net interest margin of 3.13%, shows the value of its core business as a holding company for Jersey Shore State Bank and Luzerne Bank.

We'll break down how a regional bank with a $1.9 billion net loan portfolio positioned itself for this valuation, and what its history of providing commercial, retail banking, and insurance services tells us about the power of a focused community model.

Penns Woods Bancorp, Inc. (PWOD) History

You need to understand the roots of Penns Woods Bancorp, Inc. (PWOD) to grasp its recent, transformative acquisition. The company's story is one of a community bank holding company, born from a long-standing Pennsylvania institution, that grew through strategic acquisitions before ultimately being acquired itself in 2025. The core takeaway is that PWOD was a regional player, built on the foundation of the much older Jersey Shore State Bank, whose trajectory culminated in a major merger this year.

Given Company's Founding Timeline

Year established

Penns Woods Bancorp, Inc. was formally incorporated in Pennsylvania on January 7, 1983, as the bank holding company for its primary subsidiary, Jersey Shore State Bank (JSSB).

Original location

The company is headquartered in Williamsport, Pennsylvania, which served as the central hub for its operations across North Central and Northeastern Pennsylvania.

Founding team members

While the holding company was incorporated in 1983, its foundation, Jersey Shore State Bank, has roots dating back to 1934. The official incorporation documents for the holding company do not readily name a singular founding team in the way a startup might, as it was a corporate restructuring of an existing, mature bank.

Initial capital/funding

Specific initial capital figures for the 1983 incorporation are not public, but the move essentially consolidated the capital of its wholly-owned subsidiary, Jersey Shore State Bank, under a new holding company structure. By March 31, 2025, just before its merger, the company reported total assets of approximately $2.3 billion.

Given Company's Evolution Milestones

Given Company's Transformative Moments

The company's history is defintely marked by two major shifts: the move to a multi-bank holding structure and the ultimate merger that concluded its independent run. The acquisition of Luzerne Bank in 2013 was a key moment, moving the company from a single-bank model to a multi-bank holding company, which is a significant strategic pivot for a regional institution.

• Diversifying Revenue in 2000: The acquisition of The M Group in October 2000 was a crucial step, adding non-interest income streams like insurance and brokerage services, which helped stabilize earnings beyond core lending.
• Scaling Operations with Luzerne: Bringing Luzerne Bank into the fold on June 1, 2013, expanded the total branch network and asset base, allowing for better economies of scale in a competitive regional banking environment.
• The 2025 Merger as the Capstone: The most transformative decision was the sale to Northwest Bancshares, Inc., which closed in late July 2025. This merger, valued at about $270.4 million, ended PWOD's run as an independent, publicly-traded entity (symbol PWOD was delisted from NASDAQ). The deal was a strong move for shareholders, representing a 139.0% multiple of tangible book value as of the announcement.

For the first quarter of 2025, right before the merger, the company reported strong performance, with net income hitting $7.4 million, showing the company was acquired at a point of financial strength. This financial health is what made them an attractive target, and you can dig into the specifics of that performance here: Breaking Down Penns Woods Bancorp, Inc. (PWOD) Financial Health: Key Insights for Investors

Penns Woods Bancorp, Inc. (PWOD) Ownership Structure

As of November 2025, the direct ownership structure of Penns Woods Bancorp, Inc. is no longer relevant for public trading, as the company was acquired by Northwest Bancshares, Inc. (NWBI) in an all-stock deal valued at approximately $270.4 million, which closed in July 2025.

This means its former shareholders now hold shares in Northwest Bancshares, Inc., and the entity operates as a subsidiary, but understanding its pre-merger ownership is key to seeing who drove the deal. Exploring Penns Woods Bancorp, Inc. (PWOD) Investor Profile: Who's Buying and Why?

Given Company's Current Status

Penns Woods Bancorp, Inc. was a publicly traded multi-bank holding company on the NASDAQ under the ticker PWOD until the acquisition by Northwest Bancshares, Inc. (NWBI) was completed in July 2025.

The transaction, which was an all-stock deal, effectively transitioned the company from an independent public entity to a wholly-owned subsidiary of Northwest Bancshares, Inc. This merger created a combined entity with over $17 billion in assets, significantly bolstering Northwest's presence in Pennsylvania. The deal was expected to be accretive to Northwest's 2026 earnings per share by 23%.

Given Company's Ownership Breakdown

Before the acquisition closed in July 2025, the company's stock structure was heavily weighted toward individual investors, which is common for smaller regional banks. Here's the breakdown of the common stock ownership for fiscal year 2025, based on the latest available data before the merger became effective.

To be fair, the large retail ownership meant the merger needed broad individual shareholder support, which was ultimately secured. Here's the quick math: institutional and insider ownership combined was only about 32.27%.

Given Company's Leadership

The leadership team that steered Penns Woods Bancorp, Inc. through the merger and into its new status as a subsidiary was comprised of seasoned banking professionals. The transition plan was defintely a key part of the deal.

• Richard A. Grafmyre, CFP®: Served as Chief Executive Officer (CEO) until the merger's close. Post-acquisition, he was appointed to the Board of Directors of both Northwest Bancshares, Inc. and Northwest Bank.
• Brian L. Knepp: Held the dual role of President and Chief Financial Officer (CFO).
• Christine M. Barto: Served as President & CEO of UIS (United Insurance Solutions), Senior Vice President, and Chief Human Resources Officer.
• Aron M. Carter: Senior Vice President and Chief Risk Officer (CRO).
• Michelle M. Karas: Senior Vice President, Secretary, and Chief Data Officer (CDO).

The continued presence of Richard Grafmyre on the acquiring company's board helps ensure a smooth integration of the former Penns Woods Bancorp, Inc. operations, which brought approximately $2.3 billion in assets to Northwest.

Penns Woods Bancorp, Inc. (PWOD) Mission and Values

Penns Woods Bancorp, Inc.'s core purpose was deeply rooted in traditional community banking, focusing on local economic health and personalized service, a model that drove its asset base to approximately $2.26 Billion by mid-2025. Their cultural DNA centered on being a trusted partner, a commitment that became part of the transition narrative following the acquisition by Northwest Bancshares, Inc. on July 25, 2025.

Given Company's Core Purpose

The company's core purpose was to operate as a community-focused bank holding company, prioritizing the specific financial needs of individuals, small businesses, and agricultural operations across central Pennsylvania. This focus on local markets was their competitive edge, not just a marketing slogan. Honestly, their business model was designed for consistent performance and long-term value creation for local stakeholders.

Here's the quick math on their scale: as of the second quarter ending June 30, 2025, the company reported total consolidated assets of $2,263,873 thousand (or roughly $2.26 Billion), with year-to-date net income of $11,638 thousand, showing a profitable, community-lending-driven operation right up to the acquisition.

Official mission statement

The formal mission statement of Penns Woods Bancorp, Inc. centered on being a trusted financial partner, a clear, actionable goal for a regional bank. It's defintely not a cutting-edge solution, but a foundational one.

• Be a trusted financial partner to all customers.
• Drive operations through integrity and responsible growth.
• Foster strong community involvement and local economic development.

Vision statement

While not a single, explicit statement, the company's vision was to achieve a scale that could support its communities effectively while maintaining its local, people-centric service model. The goal was to be the most significant regional community bank in their geographic footprint, providing both traditional and modern digital services.

• Maintain a reputation as an accessible financial partner.
• Achieve long-term value creation for all stakeholders.
• Combine the size and scale to support communities with personalized service.

If you are looking to understand how this mission translated into tangible financial performance, you should read Breaking Down Penns Woods Bancorp, Inc. (PWOD) Financial Health: Key Insights for Investors.

Given Company slogan/tagline

The company, through its corporate communications, consistently reinforced its purpose with a simple, community-centric phrase.

• Building new communities.

Penns Woods Bancorp, Inc. (PWOD) How It Works

Penns Woods Bancorp, Inc. (PWOD) historically operated as a bank holding company generating revenue primarily from the interest rate spread between its loans and deposits, but its independent operation ceased when it was acquired by Northwest Bancshares, Inc. on July 25, 2025. Before the acquisition, the company's value creation came from its community-focused, full-service banking model delivered through its subsidiary banks, Jersey Shore State Bank and Luzerne Bank, serving North Central and Northeastern Pennsylvania.

Given Company's Product/Service Portfolio

Prior to the acquisition, the company's profitability was driven by a diversified portfolio of traditional banking products and financial services, targeting individuals and small-to-medium enterprises in its regional market. For the first quarter of 2025, the company reported a net interest income of $16.1 million, a 17% increase year-over-year, showing the strength of its core lending business right before the merger.

Given Company's Operational Framework

The operational framework of Penns Woods Bancorp, Inc. was centered on a traditional community banking model, but with a focus on efficiency and asset-liability management (ALM). The core process was simple: attract local deposits at a lower rate, and redeploy that capital into higher-yielding loans within the same geographic footprint.

Here's the quick math: In Q1 2025, the company's net interest margin (NIM)-the key profitability metric for banks-expanded significantly to 3.13% from 2.69% a year prior. That's a clear sign of effective ALM, specifically the successful repricing of its earning assets in a rising rate environment. The company was defintely making its assets work harder.

• Deposit Gathering: Utilized a network of 21 branch locations across North Central and Northeastern Pennsylvania to secure a stable and low-cost deposit base, which totaled $1.7 billion in Q1 2025.
• Loan Origination: Focused on relationship-based lending, with net loans reaching $1.9 billion, prioritizing commercial and real estate loans which typically offer higher yields.
• Credit Management: Maintained a disciplined approach to credit quality, evidenced by a significant negative provision for credit losses of $3.0 million in Q1 2025, which included a key commercial loan recovery of $1.3 million.
• Post-Merger Reality: As of November 2025, this operational framework is now integrated into the larger Northwest Bank system, with all former Penns Woods Bancorp, Inc. branches rebranded under the Northwest Bank name.

Given Company's Strategic Advantages

The company's strategic advantage was rooted in its deep regional presence and its ability to execute on core banking fundamentals, especially in a volatile rate environment. This is what made it an attractive acquisition target for Northwest Bancshares, Inc. at a valuation of approximately $270.4 million.

• Geographic Density: Dominated its local markets in counties like Lycoming, Centre, and Luzerne, Pennsylvania, ensuring strong customer loyalty and minimal competition from larger national banks.
• Asset Sensitivity: Demonstrated an ability to benefit from rising interest rates, as seen by the Q1 2025 NIM expansion, which translated directly into a net income of $7.4 million for the quarter.
• Clean Balance Sheet: The company's total assets stood at $2.3 billion as of March 31, 2025, providing a solid foundation and appealing scale for an acquirer seeking immediate regional expansion.
• M&A Value: The ultimate strategic advantage was its complementary footprint, which linked Northwest Bank's existing presence, adding 21 new branch locations and immediately expanding the combined entity's total assets to over $17 billion.

You can read more about the principles that guided its long-term strategy here: Mission Statement, Vision, & Core Values of Penns Woods Bancorp, Inc. (PWOD).

Penns Woods Bancorp, Inc. (PWOD) How It Makes Money

Penns Woods Bancorp, Inc. (PWOD) made the vast majority of its money through the classic banking model: borrowing funds from depositors at a lower interest rate and lending those funds out at a higher interest rate, a process known as generating Net Interest Income (NII). The company's financial engine, before its acquisition by Northwest Bancshares, Inc. in July 2025, was highly dependent on this core lending activity, supplemented by fee-based services.

Penns Woods Bancorp's Revenue Breakdown

The final independent financial snapshot, based on the first quarter of 2025 (Q1 2025), clearly shows the dominance of the interest-based business model. For the quarter ended March 31, 2025, the company generated total revenue of approximately $18.7 million, with Net Interest Income driving the overwhelming majority of that figure.

Here's the quick math: Net Interest Income was $16.14 million, and Non-Interest Income was $2.57 million in Q1 2025. This structure means the bank's profitability was defintely sensitive to interest rate movements and loan demand, which is typical for a regional bank.

Business Economics

The economics of Penns Woods Bancorp were centered on its Net Interest Margin (NIM), which is the difference between the interest income generated and the amount of interest paid out. This margin is the bank's core profit driver. For Q1 2025, the Net Interest Margin expanded to 3.13%, up significantly from 2.69% in the prior year period, showing strong momentum just before the merger.

• Lending Focus: The primary source of NII was its loan portfolio, which stood at approximately $1.9 billion as of March 31, 2025. The bank was actively pushing commercial loan growth and indirect auto lending to boost asset yields.
• Pricing Strategy (NIM): The increase in the NIM was driven by the repricing of interest-earning assets, meaning new loans and investments were being made at higher market rates, outpacing the rise in the cost of deposits. This is how the bank maximized its spread.
• Funding Costs: The bank's ability to gather core deposits-checking and savings accounts-was crucial. While total deposits increased to $1.7 billion in Q1 2025, the mix shifted slightly toward higher-cost time deposits, a common pressure point in a rising rate environment.
• Fee Income Drivers: Non-Interest Income came from service charges on customer accounts, wealth management fees, and other transaction-based revenues. This stream provided a necessary buffer and diversification, though it remained a distant second to NII.

The business model was simple: grow the loan book and manage the cost of funds to keep that NIM expanding.

Penns Woods Bancorp's Financial Performance

The company's final independent quarter showcased robust financial health, driven by the expanding NIM and a significant one-time credit event. This strong performance likely enhanced its value leading into the acquisition. For a deeper dive into the shareholder perspective, you should read Exploring Penns Woods Bancorp, Inc. (PWOD) Investor Profile: Who's Buying and Why?

• Net Income: Net Income for Q1 2025 reached $7.4 million, nearly doubling the $3.8 million reported in Q1 2024. This dramatic increase was largely due to the NII growth and a $3.0 million negative provision for credit losses, which included a $1.3 million commercial loan recovery.
• Earnings Per Share (EPS): Diluted Earnings Per Share (EPS) was $0.95 for the quarter, up from $0.51 a year earlier. This is the clearest measure of profitability for shareholders.
• Return on Assets (ROAA): The annualized Return on Average Assets (ROAA), a key measure of how efficiently a bank uses its assets to generate profit, improved sharply to 1.31% in Q1 2025, compared to 0.69% in Q1 2024.
• Return on Equity (ROAE): Annualized Return on Average Equity (ROAE) also saw a significant jump to 14.76%, up from 8.03% in the prior year period. This shows the bank was generating excellent returns on shareholder capital in its final months of independent operation.

What this estimate hides is the one-time impact of the merger expenses, which totaled $1.09 million in non-interest expense for the quarter, slightly dragging down the reported profitability despite the strong core performance.

Penns Woods Bancorp, Inc. (PWOD) Market Position & Future Outlook

The standalone trajectory for Penns Woods Bancorp, Inc. (PWOD) ended with its merger into Northwest Bancshares, Inc. on July 25, 2025, fundamentally shifting its market position from a local community bank to an integrated part of a larger regional player. The former PWOD's assets of $2.25 Billion (as of March 2025) now bolster Northwest Bancshares' pro forma total assets to over $17 Billion, instantly elevating the combined entity into the top 100 largest U.S. banks.

Competitive Landscape

In the regional banking space, competition centers on deposit market share and technology-driven efficiency. The combined Northwest Bancshares entity now competes more directly with larger, multi-state regional banks in the Mid-Atlantic and Midwest, leveraging the former PWOD's strong, established presence in North Central and Northeastern Pennsylvania.

Opportunities & Challenges

The future outlook is now entirely tied to the success of the Northwest Bancshares integration. The primary opportunity is realizing the promised financial efficiencies, but integration is defintely a heavy lift, which introduces execution risk.

Industry Position

The former Penns Woods Bancorp, Inc. was a high-performing, geographically focused community bank. Its value proposition was local expertise and a stable deposit base, which is why Northwest Bancshares paid approximately $270.4 million for the acquisition.

• The merger immediately expands Northwest Bancshares' branch network by 21 locations across North Central and Northeastern Pennsylvania, strengthening its regional density.
• The combined entity's pro forma assets exceeding $17 Billion positions it as a significant regional bank, capable of competing for larger commercial and industrial (C&I) loans.
• For former PWOD shareholders, the exchange ratio of 2.385 shares of Northwest Bancshares common stock for each PWOD share offered a potential premium and a higher dividend yield.

The key takeaway for investors is that the story is no longer about PWOD's local growth, but about Northwest Bancshares' ability to execute a successful integration and realize the projected 23% accretion to 2026 fully diluted earnings per share. If you want a deeper dive into the shareholder implications of this deal, you should be Exploring Penns Woods Bancorp, Inc. (PWOD) Investor Profile: Who's Buying and Why?