About ESSA Bancorp

ESSA Bancorp, Inc. operates as the bank holding company for ESSA Bank & Trust that provides financial services to individuals, families, and businesses. The company operates through its community offices, located in Monroe, Northampton, Lehigh, Lackawanna, Luzerne, Chester, Delaware and Montgomery counties, Pennsylvania. The company is subject to comprehensive regulation and examination by the Pennsylvania Department of Banking and Securities and the Federal Deposit Insurance Corporation. The company's business consists primarily of accepting deposits from the general public and investing those deposits, together with funds generated from operations and borrowings, in residential first mortgage loans (including construction mortgage loans), commercial real estate loans, home equity loans and lines of credit, and commercial and industrial loans. The company offers a variety of deposit accounts, including checking, savings and certificates of deposits. It also offers asset management and trust services. The company offers investment services through its relationship with Ameriprise Financial Services, LLC, a third-party broker/dealer and registered investment advisor. It offers insurance benefit consulting services through its wholly owned subsidiary, ESSA Advisory Services, LLC. Market Area The company's primary market for deposits is concentrated around the areas where its full-service banking offices are located. The company's primary lending area consists of the counties where its branch offices are located, and to a lesser extent, the contiguous counties in the Commonwealth of Pennsylvania. Lending Activities The company originates other consumer loans on a limited basis. It originates residential mortgage loans pursuant to underwriting standards that generally conform to Fannie Mae and Freddie Mac guidelines. Loan origination activities are primarily concentrated in Monroe, Northampton, Lehigh, Lackawanna, Luzerne, Chester, Delaware, and Montgomery Counties, Pennsylvania. The company also offers adjustable-rate mortgage loans, which have initial fixed terms of one, three, five, or seven-years before converting to an annual adjustment schedule based on changes in a designated United States Treasury index. Home Equity Loans and Lines of Credit: Home equity loans and lines of credit are generated by the company's loan originators. Eligible properties include primary and vacation homes located in Monroe, Northampton, Lackawanna, Luzerne, Lehigh, Chester, Delaware, and Montgomery counties, Pennsylvania; and secondarily in other Pennsylvania counties contiguous to its primary market area. Commercial Real Estate Loans: Commercial real estate loans are secured by office and industrial buildings, multi-family, mixed-use properties and other commercial properties. The company generally originates fixed rate commercial real estate loans with an initial term of five to seven years and a repricing option, and a maximum term of up to 25 years for existing properties and 30 years for new construction. First Mortgage Construction Loans: The company's first mortgage construction loans are for the construction of residential properties. The company offers fixed- and adjustable-rate residential first mortgage construction loans. For all such loans, the company utilizes outside independent appraisers approved in accordance with the Bank's Appraisal Policy. It also requires fire and casualty insurance and, where circumstances warrant, flood insurance on properties. Commercial Loans: The company offers commercial loans to businesses located in its primary market area. The commercial loan portfolio includes lines of credit, equipment loans, vehicle loans, improvement loans and term loans. These loans are primarily secured by vehicles, machinery and equipment, inventory, accounts receivable, marketable securities, deposit accounts and real estate. Obligations of States and Political Subdivisions: The company's total loan portfolio consists of loan transactions, including tax and revenue anticipation notes, general obligation notes, and authority general revenue notes. Auto Loans: The company offers auto loans. Other Loans: The company offers a variety of loans that are either unsecured or secured by property other than real estate. These loans include loans secured by deposits and personal unsecured loans. Investment Securities As of September 30, 2023, the company's investment securities included Fannie Mae, Freddie Mac, Governmental National Mortgage Association securities, obligations of states and political subdivisions, the U.S. government treasury securities, the U.S. government agency securities, corporate obligations, and other debt securities. Deposits The company offers a variety of deposit accounts with a range of interest rates and terms. Its deposit accounts consist of savings accounts, interest bearing demand accounts, checking accounts, money market accounts, club accounts, certificates of deposit and IRAs, and other qualified plan accounts. The company provides commercial checking accounts for businesses. Subsidiary Activities The bank has four wholly owned subsidiaries, such as ESSACOR, Inc.; Pocono Investment Company; ESSA Advisory Services, LLC; and Integrated Financial Corporation and its fully owned subsidiary, Integrated Abstract Incorporated. ESSACOR, Inc. is a Pennsylvania corporation that has been used to purchase properties at tax sales that represent collateral for delinquent loans of the bank and is inactive. Pocono Investment Company is a Delaware corporation formed as an investment company subsidiary to hold and manage certain investments of the bank, including certain intellectual property. ESSA Advisory Services, LLC is a Pennsylvania limited liability company owned by the bank. ESSA Advisory Services, LLC is Pennsylvania limited liability company that is a full-service insurance benefits consulting company offering group services, such as health insurance, life insurance, short term and long term disability, dental, vision and 401(K) retirement planning, as well as individual health products. Integrated Financial Corporation is a Pennsylvania corporation that provided investment advisory services to the general public and is inactive. Integrated Abstract Incorporated is a Pennsylvania corporation that provided title insurance services and is inactive. Supervision and Regulation As a bank holding company, the company is required to file certain reports with, and otherwise comply with the rules and regulations of the Board of Governors of the Federal Reserve System (Federal Reserve Board). The bank is a Pennsylvania-chartered savings bank and its deposit accounts are insured up to applicable limits by the Federal Deposit Insurance Corporation (FDIC) under the Deposit Insurance Fund (DIF). The company is subject to extensive regulation by the Pennsylvania Department of Banking and Securities (the 'Department'), its chartering agency; and by the FDIC, its primary federal regulator. The company must file reports with the Department and the FDIC concerning its activities and financial condition, in addition to obtaining regulatory approvals prior to entering into certain transactions, including but not limited to, mergers with or acquisitions of other savings institutions. The Pennsylvania Banking Code of 1965, as amended (the 'Banking Code') contains detailed provisions governing the organization, location of offices, rights and responsibilities of directors, officers, employees, and depositors, as well as corporate powers, savings and investment operations, and other aspects of the bank and its affairs. The company is also subject to extensive regulation, examination and supervision by the Federal Deposit Insurance Corporation (FDIC) as its primary federal regulator. Transactions between an insured bank, such as the bank, and any of its affiliates are governed by Sections 23A and 23B of the Federal Reserve Act and implementing regulations. The Bank Secrecy Act (BSA) and the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act) require the company to implement a compliance program to detect and prevent money laundering, terrorist financing, and illicit crime. The USA PATRIOT Act also required the federal banking agencies to take into consideration the effectiveness of controls designed to combat money laundering activities in determining whether to approve a merger or other acquisition application of a member institution. The company has established policies, procedures and systems designed to comply with the BSA, USA PATRIOT Act, and regulations implemented thereunder. The company is a bank holding company that has elected to be a financial holding company and is subject to examination, regulation and periodic reporting under the Bank Holding Company Act of 1956 (the 'Bank Holding Company Act'), as administered by the Federal Reserve Board. Shares of the company's common stock are registered with the Securities and Exchange Commission under Section 12(b) of the Securities Exchange Act of 1934, as amended (the 'Exchange Act'). The company is also subject to the proxy rules, tender offer rules, insider trading restrictions, annual and periodic reporting, and other requirements of the Exchange Act. History ESSA Bancorp, Inc. was founded in 1916.