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Cascade: No. 59, Fall 2005

Community Bank Thrives in Competitive Bank Market

Nittany Bank, a community bank established in 1998, has prospered in a competitive banking environment in State College, Pennsylvania. In just seven years it has become one of the most active home-mortgage lenders in the area.

Nittany, a federal stock savings bank, is one of 15 banks and credit unions with offices in State College. It has 54 full-time equivalent employees and assets that have grown from $15 million at its inception to $69 million in 2000, $179 million in 2002, and $326 million at the end of June 2005.

Reflecting the bank’s emphasis on personal service, four of Nittany’s five offices have no teller lines. Instead, there are offices where customers sit down to talk to one of the customer representatives. Each office has a senior executive with lending authority.

Richard Barrickman, senior vice president of lending and CRA officer at Nittany, said that to him CRA means “taking care of people in the community who need home-mortgage loans.” He says, “I find out the character of the individual. Sometimes there are reasons behind a problem situation. I dig in to help someone who deserves it and try to make the deal work.” He recalled working with a customer who had financial difficulties following major surgery and with a single mother who had credit problems related to a divorce.

The bank normally makes fixed-rate loans of up to 15 years and variable-rate loans of up to 30 years, but accommodates first-time homebuyers by participating in programs of the State College Borough First-Time Home Buyer Program, the State College Community Land Trust, Pennsylvania Housing Finance Agency (PHFA), Fannie Mae, and Freddie Mac. Nittany has made 52 loans totaling $4 million since it became active with PHFA in September 2004 and has made 12 loans totaling $1 million through the two State College programs, Barrickman said.

Similarly, Nittany became a certified lender with the U.S. Small Business Administration (SBA), enabling the bank to make small-business loans in situations where collateral was inadequate. Since it became active in the SBA program in 2003, Nittany has made about 41 loans totaling $4 million, Barrickman said.

In addition, the bank started a Nittany Neighbors Real Estate Loan Fund to provide below-market loans of up to $500,000 to State College-area nonprofits for the purchase and construction of buildings and refinancing. According to Barrickman, it has made four such loans totaling $1.4 million in that program since 2002.

About half of the bank’s officers and managers serve on boards of either CRA-related nonprofits or other charitable organizations, Barrickman said. The bank has a CRA assessment area of Centre County.

For information, contact Richard C. Barrickman at (814) 238-2721 or rbarrickman@nittanybank.com; www.nittanybank.com.