Philadelphia Community Bank Failure Is Fifth Closure in 2026

Philadelphia-based Tioga-Franklin Savings Bank was closed by the Pennsylvania Department of Banking and Securities on Friday, August 21, marking the fifth bank failure of the year.

Following the appointment of the FDIC as receiver, substantially all deposits and assets of the $68 million Tioga-Franklin Savings Bank will be acquired by the $46.3 million Second Federal Savings and Loan Association (KFI Score: B-), also headquartered in Philadelphia. At the time of its failure, the bank reported total deposits of $67 million.

Since 2Q 2024, Tioga-Franklin had maintained a KFI Score of E, which accurately forecast that the institution would likely experience financial problems. Further evidence supporting the score included an April 2024 consent order and a June 2025 civil money penalty.

The April consent order identified issues within the bank related to a wide variety of operational areas such as liquidity and funds management, as well as alleged legal violations pertaining to the Bank Secrecy Act (BSA) and Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) protocols.

The June civil money penalty was levied against the bank for violations of the Flood Disaster Protection Act of 1973. Per the filing, the bank failed “to follow force placement flood insurance notification procedures in five instances and failing to purchase flood insurance on a borrower’s behalf upon the borrower’s failure to obtain flood insurance in five instances.” The bank paid a penalty of $3,750 without admitting to or denying the violations.

Except for 3Q 2025, the bank has posted negative return on average assets (ROAA), return on average equity (ROAE), net income, and pre-provision net revenue for the last three years.

Tioga-Franklin also maintained more than 20% of uninsured deposits relative to total deposits since 2Q 2024.

Individual bank delinquency rates, charge-offs, and loan compositions can be viewed via KFI’s web app, as well as through our Excel add-in’s Loan Category and Delinquency Report template.

Over the last 16 years, KFI has tracked and scored 385 banks before their closures. Of that total, 95% of banks that failed from 2010 through year-to-date (YTD) 2026 had a KFI Score of D or lower before closure by the FDIC, with KFI analysis correctly identifying those institutions as being in irreparably poor financial condition.

Bank failures peaked at 157 in 2010, followed by 51 in 2012, 24 in 2013, and 18 in 2014. Since then, bank failures have generally remained in the single-digit range.

Looking at the failures by asset size, Small Business Bank is among the smallest banks that have closed this year, with Kentland FSLA being the smallest at $3.73 million and Community Bank & Trust – West Georgia being the largest.

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