Pennstar to close Susquehanna branch

BY DAVID FALCHEK
Times Shamrock Writer

Pennstar Bank will close and consolidate offices in Dalton, Susquehanna Borough and Marshalls Creek this fall.

A July 8 notice from the bank to 4,800 customers of the offices directs them to a nearby branch that will serve their accounts after the Oct. 11 consolidation.

Officials of the bank, the Pennsylvania division of NBT Bancorp., deliberated long over the move, said Pennstar Vice President Elizabeth Nagy. Civic leaders in those towns lament the departure of a destination business.

While those areas may be prosperous – Dalton a rural borough, Susquehanna in the heart of Marcellus Shale production and Marshalls Creek in a resort area near New Jersey – the activity in the branches did not reflect that, Nagy said.

While residential and business banking in those markets are alive and well, use of the branches has been slipping. Customer trends showed more performing banking functions online.

“We are going to continue to offer access and service through our other branches as we change with consumer trends,” Nagy said.

Customers at the Marshalls Creek branch will be directed to Pennstar’s East Stroudsburg facility; Susquehanna customers to the Great Bend site; and Dalton customers to the Clarks Green branch. Susquehanna and Marshalls Creek may continue to have ATM service.

As it seeks to situate customers in new branches, it attempts to do the same with the branch employees. Pennstar hopes to find new positions within the company for it 15 full-time employees at the three branches.

Banks have had rough run the past few years, taking hits from bad debt, mounting regulation costs, and low interest rates. Operating costs remain one of the few levers banks can pull, said Matthew Schultheis, bank equities analyst with Boenning & Scattergood. That means closing branches.

Fewer people are using branches. One bank study showed branch traffic fell by 30 percent from 2009 to 2012, Schultheis said. He attributes it to the improvement and expansion of online banking services.

“Bank technology is reliable enough that it has become widely adopted across the age spectrum as more people become more comfortable with it,” he said. “Banks don’t need as many branches, or as big branches.”