Harleysville National Corporation (HNB) has announced a series of strategic initiatives designed to strengthen the capital base, and position the bank for the future.
HNB, the parent company of Harleysville National Bank, is working with its advisors and consultants to raise additional capital, execute on potential asset sales, reposition the balance sheet, and restructure funding sources. These initiatives address the challenging economic environment and its impact on the businesses and homeowners with whom Harleysville does business.
Paul Geraghty, President and CEO, said, “Legacy credit issues continue to be a challenge during this time of economic uncertainty. This was a product of our historical focus on real estate lending, specifically residential real estate development and home equity loans. As we have noted previously in prior press releases, we have taken many steps to strengthen credit administration, add to our loan workout staff, and actively manage the troubled legacy loans that are weighing down our portfolio. In addition, at our 2009 Annual Meeting of Shareholders, I indicated our intention to execute on our Capital Improvement Plan to meet regulatory requirements for a well-capitalized bank by the end of the year. With continued uncertainty in the economy, we are expediting our Capital Improvement Plan and pursuing additional sources of outside capital.”
“While our core markets have weathered the downturn better than most, additional capital should provide us with the liquidity and capital cushion to meet the challenges of the current economic environment and position the bank for the future. Our Capital Improvement Plan and the Office of the Comptroller of the Currency’s requirements do not affect our day to day relationship with our customers. Our Capital Improvement Plan is in alignment with the measures previously developed and implemented by Harleysville to address asset quality challenges, risk management and the need to maintain a strong capital base at a time of great economic uncertainty. The initiatives announced will protect the long-term value of the Harleysville franchise,” he added.
