Mid Penn Bancorp, Inc. (MPB): Analyse de Pestle [Jan-2025 Mise à jour]

Plongez dans le monde complexe de Mid Penn Bancorp, Inc. (MPB), où l'intersection de la banque, de la dynamique régionale et des défis stratégiques crée un paysage fascinant d'opportunités et de complexité. Cette analyse complète du pilon dévoile les facteurs à multiples facettes qui façonnent la stratégie commerciale de MPB, révélant comment les réglementations politiques, les tendances économiques, les changements sociétaux, les innovations technologiques, les cadres juridiques et les considérations environnementales convergent pour définir le positionnement concurrentiel de la banque dans les écosystèmes financiers du centre de la Pennsylvanie.

Mid Penn Bancorp, Inc. (MPB) - Analyse du pilon: facteurs politiques

La réglementation bancaire de l'État de Pennsylvanie a un impact sur les stratégies opérationnelles de MPB

Pennsylvanie Département des banques et des valeurs mobilières applique une stricte conformité réglementaire pour les banques à carreaux d'État. En 2024, MPB doit respecter des exigences de capital spécifiques et des normes de rapport.

Métrique réglementaire	Exigence	Statut de conformité MPB
Ratio de capital minimum de niveau 1	8%	9.2%
Exigence de capital basée sur les risques	10.5%	11.7%

Les politiques monétaires de la Réserve fédérale influencent sur les prêts bancaires et les taux d'intérêt

La politique monétaire de la Réserve fédérale a un impact direct sur les stratégies de prêt de MPB et les structures de taux d'intérêt.

• Taux des fonds fédéraux en janvier 2024: 5,33%
• Taux de prêt Prime: 8,5%
• Taux d'intérêt moyen du prêt moyen de MPB: 7,25%

Conformité de la Loi sur le réinvestissement communautaire

Évaluation de l'ARC: satisfaisant comme évalué par les régulateurs fédéraux dans la dernière évaluation.

Catégorie de performance de l'ARC	Montant d'investissement
Prêts de développement communautaire	42,3 millions de dollars
Investissements qualifiés	18,7 millions de dollars

Changements potentiels dans la surveillance bancaire fédérale

Les changements réglementaires potentiels pourraient avoir un impact sur le cadre opérationnel de MPB.

• Implémentation de finalisation de Bâle III proposée: attendue en 2025
• Coût de conformité estimé: 3,2 millions de dollars
• Ajustements potentiels des besoins en capital: 0,5 à 1,0%

Mid Penn Bancorp, Inc. (MPB) - Analyse du pilon: facteurs économiques

Conditions économiques régionales en Pennsylvanie

Le PIB de Pennsylvanie en 2023 était de 1,05 billion de dollars. Le taux de chômage en Pennsylvanie en décembre 2023 était de 3,8%. Le portefeuille de prêts de Mid Penn Bancorp est concentré dans le centre de la Pennsylvanie, 87% des prêts provenant de l'État.

Indicateur économique	Valeur	Année
PIB de Pennsylvanie	1,05 billion de dollars	2023
Taux de chômage	3.8%	Décembre 2023
Concentration locale de portefeuille de prêts	87%	2023

Impact des taux d'intérêt

Le taux des fonds fédéraux en janvier 2024 était de 5,33%. La marge d'intérêt nette de Mid Penn Bancorp au troisième trimestre 2023 était de 3,62%. Le revenu net des intérêts pour 2023 était de 101,4 millions de dollars.

Métrique financière	Valeur	Période
Taux de fonds fédéraux	5.33%	Janvier 2024
Marge d'intérêt net	3.62%	Q3 2023
Revenu net d'intérêt	101,4 millions de dollars	2023

Prêts aux petites entreprises et agricoles

Les prêts commerciaux représentaient 62% du portefeuille de prêts de Mid Penn Bancorp en 2023. Les prêts agricoles représentaient 15% du total des prêts commerciaux. Le solde total des prêts commerciaux était de 1,2 milliard de dollars.

Catégorie de prêt	Pourcentage	Solde total
Prêts commerciaux	62%	1,2 milliard de dollars
Prêts agricoles	15% de la publicité	180 millions de dollars

Analyse des risques de crédit

Le ratio des prêts non performants était de 0,58% au troisième trimestre 2023. La réserve de perte de prêt était de 22,3 millions de dollars. Le ratio de capital de niveau 1 était de 12,4% en décembre 2023.

Indicateur de risque de crédit	Valeur	Période
Ratio de prêts non performants	0.58%	Q3 2023
Réserve de perte de prêt	22,3 millions de dollars	2023
Ratio de capital de niveau 1	12.4%	Décembre 2023

Mid Penn Bancorp, Inc. (MPB) - Analyse du pilon: facteurs sociaux

Population vieillissante dans le centre de la démographie du service bancaire en Pennsylvanie

En 2024, la population de 65+ de Pennsylvanie a atteint 2 381 464, représentant 18,5% de la population totale de l'État. Le comté de Dauphin, où MPB a son siège social, détient 19,2% des résidents de plus de 65 ans.

Groupe d'âge	Pourcentage	Préférence de service bancaire
65 ans et plus	18.5%	Services de succursale traditionnels
45 à 64 ans	26.3%	Services numériques / succursales mixtes
25-44 ans	22.7%	Banque numérique d'abord

Préférences bancaires numériques chez les jeunes clients

En 2024, 78% des milléniaux et la génération Z en Pennsylvanie utilisent des plateformes de banque mobile. Les volumes de transaction numérique pour MPB ont augmenté de 42% par rapport à 2023.

Métrique bancaire numérique	Valeur 2024
Utilisateurs de la banque mobile	78%
Croissance des transactions numériques	42%
Ouvertures de compte en ligne	35%

Besoins bancaires de la communauté rurale

MPB dessert 12 comtés du centre de la Pennsylvanie, avec 47 branches concentrées dans les zones rurales et suburbaines. Revenu moyen des ménages ruraux dans les régions de service: 62 340 $.

Métrique bancaire rurale	2024 données
Les comtés servis	12
Total des succursales	47
Revenu moyen des ménages ruraux	$62,340

Dynamique de la main-d'œuvre et recrutement de talents

MPB a employé 536 employés à temps plein en 2024, avec un mandat moyen de 7,2 ans. Salaire médian pour les professionnels bancaires en Pennsylvanie: 68 500 $.

Métrique de la main-d'œuvre	Valeur 2024
Total des employés	536
Mandat moyen des employés	7,2 ans
Salaire professionnel de la banque médiane	$68,500

Mid Penn Bancorp, Inc. (MPB) - Analyse du pilon: facteurs technologiques

Investissements de plate-forme bancaire numérique

Mid Penn Bancorp a investi 2,3 millions de dollars dans les infrastructures bancaires numériques en 2023. Le volume des transactions bancaires numériques a augmenté de 37,4% par rapport à l'année précédente. La base d'utilisateurs de la banque en ligne s'est étendue à 68 500 utilisateurs actifs.

Métrique de la plate-forme numérique	2023 données
Investissement d'infrastructure numérique	2,3 millions de dollars
Croissance des transactions en ligne	37.4%
Utilisateurs bancaires en ligne actifs	68,500

Mesures de cybersécurité

L'investissement en cybersécurité a atteint 1,7 million de dollars en 2023. La mise en œuvre de l'authentification multi-facteurs a réduit les violations de sécurité potentielles de 42%. Conformité au cadre de cybersécurité NIST à 98% d'efficacité.

Métrique de la cybersécurité	Performance de 2023
Investissement en cybersécurité	1,7 million de dollars
Réduction de la violation de la sécurité	42%
Conformité au cadre du NIST	98%

Développement d'applications bancaires mobiles

Les téléchargements d'applications bancaires mobiles ont augmenté de 45% en 2023. Les mesures d'engagement des utilisateurs de l'APP indiquent que 62% des utilisateurs accédant à la plate-forme chaque semaine. Le volume des transactions mobiles a atteint 127,6 millions de dollars.

Métrique bancaire mobile	2023 données
GROPPORT DE TÉLÉCHARGEMENT D'APP	45%
Utilisateurs actifs hebdomadaires	62%
Volume de transaction mobile	127,6 millions de dollars

Implémentation de l'IA et de l'apprentissage automatique

L'investissement en technologie de l'IA a totalisé 1,4 million de dollars en 2023. Les algorithmes d'apprentissage automatique ont amélioré la précision de l'évaluation des risques de prêt de 33%. Le traitement automatisé a réduit les coûts opérationnels de 22%.

Métrique AI / ml	Performance de 2023
Investissement technologique AI	1,4 million de dollars
Précision d'évaluation des risques de prêt	Amélioration de 33%
Réduction des coûts opérationnels	22%

Mid Penn Bancorp, Inc. (MPB) - Analyse du pilon: facteurs juridiques

Conformité aux réglementations bancaires comme Dodd-Frank Act

Mid Penn Bancorp maintient le respect de la Dodd-Frank Wall Street Reform and Consumer Protection Act de 2010. En 2024, la Banque alloue 1,2 million de dollars par an aux efforts de conformité réglementaire.

Métrique de la conformité réglementaire	2024 données
Budget de conformité annuel	$1,200,000
Effectif des effectifs du personnel de conformité	18 employés à temps plein
Fréquence d'audit réglementaire	Trimestriel

Lois sur la protection des consommateurs régissant les prêts et les services financiers

Règlement du Bureau de protection financière des consommateurs (CFPB) sont strictement suivis par Mid Penn Bancorp.

Métrique de protection des consommateurs	2024 données de conformité
Instances de violation des prêts équitables	0
Taux de résolution des plaintes des consommateurs	99.7%
Taux de précision de divulgation des prêts	100%

Anti-blanchiment d'argent (AML) et connaissez les exigences de votre client (KYC)

Mid Penn Bancorp met en œuvre des protocoles AML et KYC complets.

• Investissement total de conformité AML en 2024: 875 000 $
• Systèmes de surveillance des transactions avancées déployées
• Temps de réalisation du processus de vérification du client: 24-48 heures

Métrique AML / KYC	2024 statistiques
Rapports d'activités suspectes déposées	42
Taux d'achèvement de la vérification des antécédents du client	100%
Heures de formation AML par employé	16 heures par an

Risques juridiques potentiels des changements réglementaires dans le secteur bancaire

Stratégie de gestion des risques juridiques Implique une surveillance continue des décalages réglementaires potentiels.

Métrique de gestion des risques juridiques	2024 données
Budget du département juridique	$2,500,000
Conseil de conseiller juridique externe	450 000 $ par an
Ressources de suivi des changements réglementaires	3 professionnels du droit dédiés

Mid Penn Bancorp, Inc. (MPB) - Analyse du pilon: facteurs environnementaux

Initiatives de financement vert pour le développement d'entreprises locales durables

Mid Penn Bancorp a engagé 12,3 millions de dollars de prêts de financement vert en 2023, ciblant les développements locaux des entreprises durables. Le portefeuille de prêts verts de la banque a augmenté de 17,4% par rapport à l'année précédente.

Catégorie de prêt vert	Investissement total ($)	Nombre de projets
Énergie renouvelable	4,750,000	22
Entreprises économes en énergie	3,890,000	35
Agriculture durable	3,660,000	18

Évaluation des risques climatiques pour les portefeuilles de prêts agricoles et commerciaux

Mid Penn Bancorp a mis en œuvre un cadre complet d'évaluation des risques climatiques couvrant 87,6% de ses portefeuilles de prêts agricoles et commerciaux. La banque a identifié des risques financiers potentiels liés au climat totalisant 42,5 millions de dollars dans ses segments de prêt.

Catégorie de risque	Impact financier potentiel ($)	Stratégie d'atténuation
Risque d'inondation	18,300,000	Exigences d'assurance améliorées
Impact de la sécheresse	14,200,000	Restructuration de prêt flexible
Événements météorologiques extrêmes	10,000,000	Critères de prêt ajustés au risque

Investissements en efficacité énergétique dans les infrastructures bancaires

La banque a investi 1,75 million de dollars dans des améliorations d'efficacité énergétique dans ses 43 succursales. Ces investissements ont entraîné une réduction de 22,3% de la consommation totale d'énergie et des économies annuelles de 385 000 $.

Mise à niveau des infrastructures	Investissement ($)	Économies d'énergie (%)
Éclairage LED	450,000	12.6
Modernisation du CVC	850,000	8.4
Installation du panneau solaire	450,000	1.3

Pratiques bancaires durables pour respecter l'évolution des normes environnementales

Mid Penn Bancorp a aligné 94,2% de ses opérations avec les normes réglementaires environnementales actuelles. La banque a réduit son empreinte carbone de 26,7% grâce à des initiatives de durabilité ciblées.

Métrique de la durabilité	Performance de 2023	Changement d'une année à l'autre
Réduction des émissions de carbone	26.7%	+8.3%
Conformité réglementaire	94.2%	+5.6%
Offres de produits durables	37	+12

Mid Penn Bancorp, Inc. (MPB) - PESTLE Analysis: Social factors

You're looking at Mid Penn Bancorp's (MPB) social landscape, and the key takeaway is this: their expansion into the metro areas fundamentally changes their customer profile and risk exposure, but their deep-rooted community banking model is their defintely strongest social capital. The real near-term challenge is managing the cultural and financial friction of integrating two major acquisitions in less than a year, which is already showing up in their expense lines.

Expanding into the Greater Philadelphia and Southern New Jersey metro areas changes the customer base.

The strategic move into the Greater Philadelphia and Southern New Jersey markets, fueled by the William Penn Bancorp acquisition, which closed in April 2025 for approximately $120 million, shifts the customer base from predominantly rural and central Pennsylvania to a more urban, financially sophisticated, and competitive demographic. This new market demands a different kind of service mix and scale.

The combined entity's assets totaled approximately $6.3 billion following the William Penn acquisition. This scale is necessary to compete with larger regional banks in a metro area, but it also means serving a customer base with higher demand for complex commercial lending and wealth management solutions. Mid Penn Bancorp's CEO has set a bold objective to grow the Greater Philadelphia area assets to $5 billion in the coming years, which shows the long-term commitment to this new, larger customer segment.

Strong focus on the community bank model is a key differentiator against national banks.

Mid Penn Bancorp's core strength is its community bank model, and this is a major social differentiator, especially in the wake of recent bank instability. They actively position themselves as a safe, local alternative to the large regional banks that faced crises of confidence.

This commitment is quantifiable and visible in their social impact. For example, in 2023, the bank raised and contributed $2.42 million to 889 organizations, with employees volunteering 13,926 hours. This level of community involvement builds the social trust that's crucial for retaining core deposits in a new, competitive market. Also, the CEO's high-profile involvement in distributing over $1 billion in Paycheck Protection Program (PPP) loans during the pandemic created significant social capital and name recognition in the Philadelphia market.

Demand for a full-service portfolio (wealth management, insurance) drives fee income growth.

The more affluent and complex customer base in the metro areas drives demand for a full-service portfolio beyond traditional lending and deposits, specifically in noninterest income services like wealth management and insurance. This is a clear opportunity to diversify revenue away from interest rate-sensitive core banking.

The strategy is working. Noninterest income for the third quarter of 2025 totaled $8.2 million, a substantial jump from $5.2 million in the third quarter of 2024. This 57.7% increase year-over-year is attributed to higher earnings from life insurance and mortgage banking activities. For the first nine months of 2025, noninterest income reached $19.6 million, up from $16.3 million in the comparable 2024 period. That's a strong, clean one-liner on diversification.

Noninterest Income Metric	Q3 2025 Value	Q3 2024 Value	Growth Rate (YoY)
Quarterly Noninterest Income	$8.2 million	$5.2 million	57.7%
Nine-Month Noninterest Income (YTD)	$19.6 million	$16.3 million	20.2%

Workforce integration and cultural alignment are critical post-acquisition challenges.

The William Penn Bancorp acquisition, completed in April 2025, and the pending acquisition of 1st Colonial Bancorp, announced in September 2025, bring inherent integration risks. While both are community banks, merging distinct cultures and IT systems is a major social and operational hurdle. The risk factors explicitly cite the potential for 'difficulties and delays in integrating the business' and 'difficulties in integrating distinct business operations, including information technology difficulties.'

Here's the quick math on the cost side: the integration is already driving up operating expenses. Noninterest expenses rose to $38.0 million for the third quarter of 2025, a 26.8% increase from the previous year. A significant portion of this rise is directly tied to higher salaries and benefits and software costs, which are classic signs of initial merger integration expenses. To mitigate this, Mid Penn Bancorp must focus on cultural alignment by:

• Retaining key talent from the acquired institutions.
• Harmonizing compensation and benefits packages.
• Clearly communicating the value of the combined $6.3 billion franchise to all employees.

If the cultural onboarding takes 14+ days, churn risk rises, especially among high-value commercial lenders. The bank needs to keep expenses controlled to get back to neutral or positive operating leverage, a stated 2024 strategic goal.

Mid Penn Bancorp, Inc. (MPB) - PESTLE Analysis: Technological factors

Use of ATM Plus interactive tellers to streamline branch services.

You are seeing a clear shift in how regional banks like Mid Penn Bancorp are managing their physical footprint, and the Interactive Teller Machine (ITM), or ATM Plus, is the key tool. This technology allows a single remote teller to assist customers across multiple branches, extending service hours and cutting down on staffing costs at the branch level.

Mid Penn Bancorp explicitly committed to this model with the opening of its new full-service financial center in Delaware County in February 2025, which features a 'state-of-the-art ATM Plus interactive teller.' This deployment is a strategic move to offer 'streamlined services' while expanding into the Greater Philadelphia market following the William Penn Bancorporation acquisition. The goal is simple: maintain a high-touch community presence but with a more efficient, technology-backed service model.

Increased adoption of e-records and e-signing reduces paper waste and improves efficiency.

The drive for efficiency is directly tied to digital adoption, which helps lower the core efficiency ratio-a key metric for bank profitability. Mid Penn Bancorp's core efficiency ratio improved significantly in 2025, dropping to 58.8% in the third quarter from 64.9% in the third quarter of 2024. This improvement demonstrates success in controlling noninterest expenses, which is where technology investments pay off by automating manual processes.

You can see the investment in the financial statements: the noninterest expense for the three months ended March 31, 2025, included a $454 thousand increase in software licensing compared to the same period in 2024. This outlay is for the systems that enable e-records, e-signing, and the seamless integration of the acquired William Penn Bank. Furthermore, digital engagement is measurable; the bank's online Financial Wellness Center's budget calculator was used 10,500 times in the preceding year, showing strong customer adoption of self-service tools.

Need for continuous investment in digital banking to compete with larger, tech-forward institutions.

For a bank with approximately $6.3 billion in consolidated assets post-merger in May 2025, continuous tech investment is not optional; it is a competitive necessity. While Mid Penn Bancorp focuses on personalized service, its customers still demand the same 'state-of-the-art mobile banking' and online platforms offered by national players.

The bank's digital offerings, including its Business Mobile App and secure online banking, are critical differentiators, especially as the bank expands its footprint across Pennsylvania and Central and Southern New Jersey. The efficiency gains are tangible, but the capital expenditure is constant.

• Invest in digital to keep the core efficiency ratio low.
• Mobile banking is a non-negotiable expectation for all customers.
• Integration of acquired systems post-merger is a major IT undertaking.

Cybersecurity risk is a constant, defintely high-cost factor for all financial institutions.

Cybersecurity is the single most critical technological risk, and Mid Penn Bancorp's management views it as one of the company's 'most critical risks.' This isn't just a compliance issue; it's a high-cost operational factor that requires continuous capital allocation.

Globally, cybersecurity spending is expected to increase by 15% in 2025, reaching an estimated $212 billion, with security services leading the growth. For regional banks, this means constantly upgrading to industry-leading security tools, including next-generation firewalls and intrusion detection systems, as Mid Penn Bancorp does. The threat environment means that even with a strong efficiency ratio, this line item will only grow.

Here's the quick math on the cost pressure: 86% of bank executives across the U.S. cited cybersecurity as a top concern and their biggest area for budget increases in 2025. You must be proactive, or a single breach could wipe out years of efficiency gains.

Technological Investment Metric	Value (2025 Fiscal Year Data)	Strategic Implication
Q1 2025 Software Licensing Increase (YoY)	$454 thousand	Direct evidence of increased investment in core systems for digital services and e-document management.
Q3 2025 Core Efficiency Ratio	58.8%	Improved operating leverage, partially driven by technology adoption like ITMs and digital channels to reduce labor costs.
New Interactive Teller Deployment	One 'state-of-the-art ATM Plus' in February 2025	Strategic move to streamline branch services and expand service hours in new, high-growth markets.
Industry-Wide Cybersecurity Spending Increase	Expected to increase 15% in 2025	Indicates the high and non-discretionary cost pressure Mid Penn Bancorp faces to maintain a secure environment and regulatory compliance.

Mid Penn Bancorp, Inc. (MPB) - PESTLE Analysis: Legal factors

Required regulatory approvals for the $101 million 1st Colonial Bancorp, Inc. acquisition.

The $101 million acquisition of 1st Colonial Bancorp, Inc. is a strategic move, but it's defintely a legal gauntlet that requires multiple layers of regulatory consent before the expected closing in late Q1 or early Q2 2026. Since Mid Penn Bancorp is a bank holding company, the primary federal approval comes from the Federal Reserve (FRB) under the Bank Holding Company Act.

Plus, because the combined entity operates across state lines in Pennsylvania and New Jersey, you also need the green light from the state banking departments: the Pennsylvania Department of Banking and Securities and the New Jersey Department of Banking and Insurance. These agencies scrutinize the deal for its impact on competition, financial stability, and, critically, community needs. Failure to secure timely, unconditional approval from any one of these bodies can delay or even derail the transaction.

Compliance with stringent capital adequacy guidelines is non-negotiable for bank holding companies.

For a bank holding company, maintaining capital adequacy is the bedrock of regulatory compliance. Mid Penn Bancorp has been a realist here, consistently reporting capital ratios for both the holding company and its bank subsidiary that are in excess of the regulatory minimums required to be considered well capitalized as of September 30, 2025. That's a good sign.

Here's the quick math: the combined pro forma total assets, based on June 30, 2025, data, will be more than $7.2 billion. This asset size keeps Mid Penn below the $10 billion and $50 billion thresholds that trigger more onerous compliance burdens, such as the full scope of Dodd-Frank Act (DFA) rules and mandatory annual supervisory stress testing (which currently applies to banks with $100 billion or more in assets).

The challenge is managing growth to stay compliant, which means keeping a close eye on the Common Equity Tier 1 (CET1) ratio, Tier 1 Capital Ratio, and Total Capital Ratio, all while absorbing the acquired assets.

Integration of acquired banks' legal and compliance frameworks post-merger is complex.

The real work starts after the approval. Integrating 1st Colonial Bancorp's legal and compliance frameworks into Mid Penn's is a massive undertaking, and it's where most mergers run into trouble. You're merging two separate Compliance Management Systems (CMS) into one cohesive, auditable system.

The immediate legal and compliance focus areas for the integration team are:

• Bank Secrecy Act/Anti-Money Laundering (BSA/AML): Harmonizing Know Your Customer (KYC) and transaction monitoring systems to meet the more stringent of the two banks' standards.
• Fair Lending: Conducting a thorough pre-merger review of lending data (like Home Mortgage Disclosure Act or HMDA data) to ensure the combined entity does not inherit or create disparate treatment risk, which is a major regulatory focus.
• Data Privacy: Merging customer data systems while ensuring compliance with both Pennsylvania and New Jersey state data privacy statutes, especially with the New Jersey Consumer Data Privacy law effective January 8, 2025.

A single, clean compliance framework is the only way to avoid regulatory penalties.

Adherence to state and federal consumer protection laws across a wider geographic footprint.

Expanding the footprint into New Jersey and deeper into the greater Philadelphia metropolitan area means Mid Penn must now navigate two distinct sets of state-level consumer protection laws, on top of federal ones like the Community Reinvestment Act (CRA). The CRA is particularly critical, as the merger will redefine Mid Penn's assessment area and performance will be scrutinized during the approval process and subsequent examinations.

In Pennsylvania, the Unfair Trade Practices and Consumer Protection Law (UTPCPL) gives the state Attorney General significant power to pursue unfair or deceptive acts. Furthermore, Pennsylvania has a strict usury law that caps the interest rate on consumer loans under $50,000 at 6% per annum, a detail that must be programmed correctly into all loan origination systems. The legislative environment is also dynamic, with a bill (HB 81) in the 2025-2026 session aiming to prohibit banks from charging additional fees for paper statements, a clear risk to non-interest income if passed.

Mid Penn Bancorp, Inc. (MPB) - PESTLE Analysis: Environmental factors

Formal Board oversight of Environmental, Social & Governance (ESG) programs.

You need to know who is ultimately accountable for the environmental strategy, and at Mid Penn Bancorp, Inc. (MPB), that responsibility rests firmly with the Board of Directors. The Board provides formal oversight of the Corporation's sustainability programs and policies through its Nominating and Corporate Governance Committee.

This structure ensures that ESG principles are integrated into the business model, not just treated as a side project. An internal committee, established by the executive leadership team and the Board, is tasked with driving and monitoring progress on key ESG issues, aiming for increased transparency. This is a critical governance point; it shows the commitment starts at the top.

Commitment to reducing operational footprint via energy-efficient systems and LED lighting.

Mid Penn is actively working to reduce its operational carbon footprint, which is a smart move that cuts utility costs and improves sustainability. They are in a multi-year process of converting all their facilities to energy-efficient systems and LED lighting. This isn't just a plan; it's an ongoing, tangible effort to minimize their environmental impact.

The company has also focused on eliminating single-use plastics by adding water filtration systems to all facilities, which discontinues the use of disposable plastic water bottles. Plus, when they refresh a branch, they use environmentally conscious materials, including UL Environmental Certified or UL Greenguard Certified flooring and LEED Certified furniture. That's defintely a concrete investment in green infrastructure.

Increased use of e-records and e-signing technology reduces paper consumption.

The shift to digital is a huge environmental win for any bank, cutting down on paper waste and the carbon emissions tied to printing and shipping. Mid Penn has increased its use of e-records and e-signing technology to achieve a reduction in paper waste and carbon emissions.

Here's the quick math on digital adoption: the enrollment in Online Banking increased by 15.45% year-over-year in 2024. That measurable rise in digital engagement directly translates into less paper being used across their retail locations and back-office operations. This trend is a clear opportunity to continue driving down operating expenses.

Moderate physical climate risk exposure across its 47 physical assets requires study.

Mid Penn Bancorp's footprint, primarily across Pennsylvania and central New Jersey, exposes it to moderate physical climate risks, mostly related to severe weather events common in the Mid-Atlantic region. The Corporation has approximately 47 branches as of late 2024, and each one is a physical asset subject to potential climate-related disruption or damage.

The company recognizes climate change is a growing risk and is committed to mitigation. However, the larger financial risk lies in their lending portfolio, where a significant portion of loans is secured by real property. If any of that collateral is found to contain hazardous or toxic substances, Mid Penn could be liable for substantial remediation costs, which would materially reduce the property's value. This requires ongoing, rigorous environmental review before any foreclosure action.

A summary of their environmental initiatives and risks looks like this:

Environmental Factor	2025 Status / Metric	Strategic Implication
Board Oversight	Formal oversight via Nominating and Corporate Governance Committee.	Strong governance structure for ESG risk management.
Digital Adoption (Paper Reduction Proxy)	Online Banking enrollment increased by 15.45% (YOY 2024).	Clear reduction in operational paper waste and carbon emissions.
Energy Efficiency	Multi-year, ongoing conversion to LED lighting and energy-efficient systems in all facilities.	Long-term reduction in utility costs and carbon footprint.
Physical Assets Exposure	Approximately 47 branches across Pennsylvania and central New Jersey.	Requires continuous physical climate risk assessment (e.g., flood/storm exposure) for all owned/collateral properties.