Page 1

Peoples Financial SERVICES CORP . NEWS RELEASE PEOPLES FINANCIAL SERVICES CORP . Reports Third Quarter 2021 Earnings 10/22/2021 SCRANTON , Pa . , Oct. 22 , 2021 / PRNewswire / -- Peoples Financial Services Corp. ( " Peoples " ) ( NASDAQ : PFIS ) , the bank holding company for Peoples Security Bank and Trust Company , today reported unaudited financial results at and for the three months and nine months ended September 30 , 2021. Peoples reported net income of $ 9.1 million , or $ 1.26 per diluted share for the three months ended September 30 , 2021 , an increase of 10.5 % when compared to $ 8.3 million , or $ 1.14 per diluted share for the comparable period of 2020. The increase in earnings for the three months ended September 30 , 2021 is primarily the result of a $ 2.1 million increase to pre - provision net interest income and a $ 0.6 million decrease to the provision for loan losses , partially offset by a $ 1.5 million decrease to noninterest income , primarily from lower interest rate swap revenue , and an increase to noninterest expense of $ 0.3 million . Net income for the nine months ended September 30 , 2021 , totaled $ 27.1 million or $ 3.74 per diluted share , a 30.3 % increase when compared to $ 21.2 million or $ 2.87 per diluted share for the comparable period of 2020. The increase in earnings in the 2021 nine month period is the product of a decrease to our provision for loan losses of $ 6.3 million , primarily due to an adjustment in the year ago period to the economic qualitative factors included in our allowance for loan losses methodology relating to the impact of COVID - 19 , an increase to pre - provision net interest income of $ 3.1 million and a decrease to noninterest expense of $ 0.4 million . Partially offsetting the increase were a higher income tax provision of $ 2.3 million and a decrease in noninterest income of $ 1.6 million . In addition to evaluating its results of operations in accordance with GAAP , Peoples routinely supplements its evaluation with an analysis of certain non - GAAP financial measures , such as tangible stockholders ' equity and core net income ratios . The reported results included in this release contain items , which Peoples considers non - core , namely gains and losses incurred within the investment securities portfolio . Peoples believes the reported non- 1