ORRF - Orrstown Financial announces strategic initiatives expects ~$3.4M annual cost savings

• Orrstown Financial Services ( NASDAQ: ORRF ) on Wednesday announced strategic initiatives to drive long-term growth and improve operating efficiencies.
• The initiatives are expected to generate ~$3.4M of pre-tax annual cost savings once completed.
• The initiatives include closing five branches and certain staffing model adjustments.
• ORRF expects to incur a one-time pre-tax charge of ~$3.1M in Q3, which includes building and fixed asset write-offs of $1.9M and early retirement/severance costs of $1.2M.
• A portion of the savings from the initiatives will be used to address ongoing wage pressures and make additional investments in technology to create operational efficiencies.
• Based on ORRF's expected Q3 operating expense rate (excluding the one-time charge), the firm expects the impact of net savings on operating expenses to be a reduction of ~$1M annually.
• All five branches expected to be closed are in Pennsylvania.
• The closures are expected to be completed in Q4.
• Staffing model adjustments will be comprised of the elimination of certain roles within Orrstown Bank and early retirement packages for three officers.

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