Pioneer Bancorp, Inc. (Pioneer) operates as the bank holding company for Pioneer Bank, National Association that provides various banking products and services.
The bank operates various retail banking offices in Albany, Greene, Rensselaer, Saratoga, Schenectady and Warren counties, as well as a wealth management office in Columbia County in New York. The company attracts deposits from the general public and municipalities and uses those funds along with advances from the Federal Home Loan Bank...
Pioneer Bancorp, Inc. (Pioneer) operates as the bank holding company for Pioneer Bank, National Association that provides various banking products and services.
The bank operates various retail banking offices in Albany, Greene, Rensselaer, Saratoga, Schenectady and Warren counties, as well as a wealth management office in Columbia County in New York. The company attracts deposits from the general public and municipalities and uses those funds along with advances from the Federal Home Loan Bank of New York (‘FHLBNY’) and funds generated from operations to originate commercial real estate loans, commercial and industrial loans, commercial construction loans and home equity loans and lines of credit, and to a lesser extent, consumer loans. Since January 2016, all of the company’s residential mortgage loans have been purchases through the company’s relationship with an unaffiliated mortgage banking company.
The company also invests in securities, which consist primarily of the U.S. Treasury obligations, securities of various government agencies and government-sponsored enterprises, including mortgage-backed securities, collateralized mortgage obligations, municipal obligations, and corporate debt securities. The company offers a variety of deposit accounts, including demand accounts, savings accounts, money market accounts, certificate of deposit accounts, and municipal deposit banking services. Municipal deposit banking services were previously provided through a limited-purpose commercial bank subsidiary, Pioneer Commercial Bank. On September 16, 2024, the OCC approved the merger of Pioneer Commercial Bank with and into the bank with the bank as the resulting entity (the Commercial Bank Merger). The Commercial Bank Merger closed on October 1, 2024. Following the completion of the Commercial Bank Merger, the Bank now directly offers full municipal deposit banking services which were previously provided through Pioneer Commercial Bank. The bank also sells commercial and consumer insurance products and employee benefit products and services through Pioneer Insurance Agency, Inc. and provides wealth management services through its subsidiary, Pioneer Financial Services, Inc.
Primary Market Area and Customers
The company’s primary market area encompasses Albany, Greene, Rensselaer, Saratoga, Schenectady and Warren counties where the company’s offices are located, and their contiguous counties, which are located in the Capital Region of New York (the ‘Capital Region’) and include the cities of Albany, the capital of New York, Schenectady and Troy.
Lending Activities
The company’s principal lending activity has been originating commercial real estate loans (including multi-family real estate loans), commercial and industrial loans, commercial construction loans and home equity loans and lines of credit. Beginning in January 2016, the company entered into a strategic partnership with Homestead Funding Corp. (the ‘Mortgage Banking Company’), an unaffiliated mortgage banking company, to outsource the company’s residential mortgage loan originations, underwriting and closing processes. Through this partnership, the company refers its customers to the Mortgage Banking Company and then the company decides whether the company wants to purchase the residential mortgage loans originated by the Mortgage Banking Company for the company’s portfolio.
The company’s commercial lending efforts focus on the small-to-medium sized business market, targeting borrowers with outstanding loan balances that typically range between $500,000 to $10.0 million. The company focuses primarily on commercial real estate loans, commercial and industrial loans and commercial construction loans in the company’s market area. As part of its commercial lending strategy, the company plans to continue to use its commercial relationships to increase its commercial transactional deposit accounts.
Commercial Real Estate Loans: The company’s commercial real estate loans are secured primarily by multi-family properties, office buildings, industrial facilities, retail facilities and other commercial properties, substantially all of which are located in its primary market area.
The company’s multi-family real estate loans are generally secured by properties consisting of five to 100 rental units within its market area. The company originates a variety of adjustable-rate multi-family residential real estate loans with terms and amortization periods generally of up to 25 years (or 30 years if the age of the collateral is less than 10 years old), which may include balloon payments. Interest rates and payments on the company’s adjustable-rate loans adjust generally every five years and generally are indexed to the comparable FHLBNY amortizing advance indications, plus a margin.
Commercial and Industrial Loans: The company originates commercial loans and lines of credit to a variety of small and medium-sized businesses in the company’s market area. These loans are generally secured by accounts receivable, inventory or other business assets, and the company may support this collateral with liens on real property. As of December 31, 2024, commercial and industrial loans totaled $108.5 million, or 7.5% of its total loan portfolio. Customers for these loans include professional businesses, family-owned businesses and not-for-profit businesses.
Commercial lending products include revolving lines of credit and term loans. The company focuses its efforts on experienced, growing small- to medium-sized, privately held companies.
Commercial Construction Loans: The company originates commercial construction loans primarily to established developers to finance the construction of commercial and multi-family properties, or to acquire land for the development of commercial and multi-family properties, and to fund infrastructure improvements. The company also provides construction loans to local developers for the construction of one- to four-family residential developments. Additionally, the company originates rehabilitation loans, enabling a borrower to partially or totally refurbish an existing structure, which are structured as construction loans and monitored in the same manner. Most of these loans are secured by properties located in the company's primary market area.
The company’s commercial construction loans are generally interest-only loans that provide for the payment of interest during the construction phase, which is usually 12 to 24 months.
Residential Mortgage Lending: The company purchases for its portfolio both fixed-rate single-family mortgage loans, as well as adjustable-rate single-family loans, with maturities up to 30 years. Most of these one- to four-family residential properties are located in the company’s primary market area and many are underwritten according to Fannie Mae guidelines.
The company’s purchased adjustable-rate residential real estate loans have interest rates that are fixed for an initial period ranging from one to ten years.
Home Equity Loans and Lines of Credit: The company offers home equity loans and home equity lines of credit, both of which are secured by either first mortgages or second mortgages on owner occupied, one- to four-family residences.
Home equity loans and lines of credit secured by junior mortgages have greater risk than residential mortgage loans secured by first mortgages.
Consumer Loans: The company offers a limited range of consumer loans, principally to customers residing in its primary market area with other relationships with it and with acceptable credit ratings. The company’s consumer loans primarily consist of personal loans to the owners of certain commercial businesses who have commercial loans with the company, and to a lesser extent, loans on automobiles, overdraft accounts and other unsecured consumer loans.
Securities
As of December 31, 2024, the company’s securities included U.S. treasury; mortgage-backed securities, such as U.S. Government agency securities and Government-sponsored enterprises; collateralized mortgage obligations, such as U.S. Government agency securities and Government-sponsored enterprises; and municipal obligations.
Deposit Accounts
The substantial majority of the company’s deposits are from depositors who reside in the company’s primary market area. The company accesses deposit customers by offering a broad selection of deposit instruments for individuals, businesses, and municipalities. The company generally requests commercial business borrowers to maintain their primary deposit accounts with the company.
The company has developed a program for the retention and management of municipal deposits. These deposits are from local government entities, such as towns, cities, school districts and other municipalities. The company generally solicits their operating and savings accounts and not time-based deposits. Municipal deposit accounts are collateralized by eligible government and government agency securities and municipal obligations, and by FHLBNY letters of credit.
Subsidiaries
Pioneer Insurance Agency, Inc.
Pioneer Insurance Agency, Inc. is a full-service insurance agency offering personal and commercial insurance, including homeowners, automobile and comprehensive business insurance, and works with major national insurance companies as well as specialty markets. Pioneer Insurance Agency, Inc. also offers employee benefits products and consulting services under the name Pioneer Benefits Consulting, including group health, dental, disability and life insurance products and defined contribution and defined benefit administration and human resource management services.
Pioneer Financial Services, Inc.
Pioneer Financial Services, Inc., a New York corporation and wholly owned subsidiary of the bank, provides wealth management services to the bank’s customers in partnership with LPL Financial, a registered broker dealer. Wealth management services provided by Pioneer Financial Services, Inc. to customers include investment advice, retirement income planning, estate planning, business succession and employer retirement planning.
Supervision and Regulation
The company is subject to comprehensive regulation and examination by the Board of Governors of the Federal Reserve System (the ‘Federal Reserve Board’). The company also is subject to the rules and regulations of the SEC under the federal securities laws.
The bank is subject to comprehensive regulation and examination by the Office of the Comptroller of the Currency (OCC) and by the Federal Deposit Insurance Corporation (the ‘FDIC’) as the bank’s insurer of deposit accounts.
The bank is a national bank, regulated and supervised primarily by the OCC. The bank is also subject to regulation by the FDIC in more limited circumstances because the bank’s deposits are insured by the FDIC. The bank is also a member of the FHLBNY.
As a national bank, the bank derives its lending and investment powers from the National Bank Act, as amended, and the regulations of the OCC.
Section 23B transactions also include the bank’s providing services and selling assets to an affiliate. The bank is a member of the Deposit Insurance Fund, which is administered by the FDIC.
The bank’s latest CRA (Community Reinvestment Act) rating in September 2023 was ‘Outstanding’.
The bank is subject to a variety of federal statutes and regulations that are intended to protect consumers and prohibit discrimination in the granting of credit. These statutes and regulations provide for a range of sanctions for non-compliance with their terms, including imposition of administrative fines and remedial orders, and referral to the Attorney General for prosecution of a civil action for actual and punitive damages and injunctive relief.
The USA PATRIOT Act and the Bank Secrecy Act and their implementing regulations require financial institutions to develop programs to assist the U.S. government agencies in detecting and preventing money-laundering and terrorist financing activities and to report suspicious activities. The USA PATRIOT Act also gives the federal government powers to address terrorist threats through enhanced domestic security measures, expanded surveillance powers, increased information sharing and broadened anti-money laundering requirements. The federal banking agencies are required 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. Accordingly, if the company engages in a merger or other acquisition, the company’s controls designed to combat money laundering would be considered as part of the application process. In addition, non-compliance with these laws and their implementing regulations could result in fines, penalties and other enforcement measures. The company has developed policies, procedures and systems designed to comply with these laws and regulations.
The bank is a member of the Federal Home Loan Bank System.
The company’s common stock is registered with the SEC. The company is subject to the information, proxy solicitation, insider trading restrictions, and other requirements under the Securities Exchange Act of 1934.
The Sarbanes-Oxley Act is intended to improve corporate responsibility, provide for enhanced penalties for accounting and auditing improprieties at publicly traded companies and protect investors by improving the accuracy and reliability of corporate disclosures pursuant to the securities laws. The company has policies, procedures, and systems designed to comply with this Act and its implementing regulations.
History
Pioneer Bancorp, Inc. was founded in 1889. The company was incorporated in 2019.
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