SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

Form 8-K

Current Report

Pursuant to Section 13 or 15(d) of the Securities Act of 1934

Date of Report (Date of earliest event reported) October 18, 2011

AMERISERV FINANCIAL, Inc.

(exact name of registrant as specified in its charter)

Pennsylvania        0-11204        25-1424278

(State or other     (commission    (I.R.S. Employer

jurisdiction        File Number)   Identification No.)

of Incorporation)

Main and Franklin Streets, Johnstown, Pa.  15901

(address or principal executive offices)   (Zip Code)

Registrant's telephone number, including area code: 814-533-5300

N/A

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to

simultaneously satisfy the filing obligation of the registrant under

any of the following provisions:

( ) Written communications pursuant to Rule 425 under the Securities

Act (17 CFR 230.425)

( ) Soliciting material pursuant to Rule 14a-12 under the Exchange

Act (17 CFR 240.14a-12)

( ) Pre-commencement communications pursuant to Rule 14d-2(b) under the

Exchange Act (17 CFR 240.14d-2(b))

( ) Pre-commencement communications pursuant to Rule 13e-4(c) under the

Exchange Act (17 CFR 240.13e-4c))

Form 8-K

Item 2.02 Results of operation and financial condition.

AMERISERV FINANCIAL Inc. (the "Registrant") announced third quarter and first nine months results through September 30, 2011.  For a more detailed description of the announcement see the press release attached as Exhibit #99.1.  

Exhibits

--------

Exhibit 99.1

Press release dated October 18, 2011, announcing the third quarter and first nine months results through September 30, 2011.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

AMERISERV FINANCIAL, Inc.

By /s/Jeffrey A. Stopko

Jeffrey A. Stopko

Executive Vice President

& CFO

Date: October 18, 2011

Exhibit 99.1

AMERISERV FINANCIAL REPORTS EARNINGS FOR THE THIRD QUARTER AND FIRST NINE MONTHS OF 2011     

JOHNSTOWN, PA – AmeriServ Financial, Inc. (NASDAQ: ASRV) continued its positive earnings momentum in the third quarter of 2011 by reporting net income of $1,566,000 or $0.05 per diluted common share.  This represents significant improvement of $957,000 from the third quarter 2010 net income of $609,000 or $0.02 per diluted common share.  For the nine month period ended September 30, 2011, the Company reported net income of $4,767,000 or $0.17 per diluted share, a $4.6 million improvement over the net income of $168,000 or ($0.03) per diluted share reported for the same nine month period in 2010.  The following table highlights the Company’s financial performance for both the three and nine month periods ended September 30, 2011 and 2010:    

Glenn L. Wilson, President and Chief Executive Officer, commented on the third quarter 2011 financial results: “Continued improvements in asset quality were a key factor contributing to our strong growth in earnings in 2011.  Non-performing assets again declined as a result of our successful problem credit resolution efforts and now total $5.3 million or only 0.80% of total loans.  I was also pleased with the growth in non-interest revenue, particularly within our trust and wealth management business, and our overall expense control.  Our stable net interest margin performance during periods of market volatility reflects the benefit of growth in both loans and deposits this year.  Overall, AmeriServ Financial was able to achieve significantly improved earnings while further strengthening our balance sheet as evidenced by a tier one capital to assets ratio of 11.70% and loan loss reserve coverage of non-performing assets of 301% at September 30, 2011.”          

The Company’s net interest income has been relatively stable.  It increased in the third quarter of 2011 by $95,000 or 1.2% from the prior year’s third quarter and for the first nine months of 2011 it decreased by $182,000 or 0.7% when compared to the first nine months of 2010.  The Company’s 2011 net interest margin of 3.70% was seven basis points lower than the net interest margin for the first nine months of 2010 but the net interest margin has now operated near the 3.70% level for the past five consecutive quarters.  Reduced loan balances were the primary factor causing the drop in both net interest income and net interest margin in 2011. Specifically, total loans averaged $658 million in 2011, a decrease of $47 million or 6.7% from the same nine month period in 2010.  The lower balances reflect the results of the Company’s focus on reducing its commercial real estate exposure and problem loans during this period.  However, total loan balances appear to have bottomed in the first quarter of 2011. Loans have increased by $23 million over the past two quarters reflecting the successful results of the Company’s more intensive sales calling efforts.  The Company has strengthened its excellent liquidity position by reinvesting excess cash in high quality investment securities and short-term investments whose average balance increased by $47 million in the first nine months of 2011.  Careful management of funding costs allowed the Company to mitigate a significant portion of the drop in interest revenue during the past twelve months.  Specifically, interest expense in the third quarter of 2011 declined by $663,000 from the same prior year quarter due to reduced deposit costs.  This reduction in deposit costs has not negatively impacted deposit balances which have increased by $26 million or 3.3% since December 31, 2010.      

The improvements in asset quality evidenced by lower levels of non-performing assets and classified loans allowed the Company to reverse a portion of the allowance for loan losses into earnings in 2011 while still increasing the coverage ratio.  During the first nine months of 2011, total non-performing assets decreased by $9.0 million or 62.8% to $5.3 million or 0.80% of total loans as a result of successful resolution efforts.  Classified loans rated substandard or doubtful also dropped by $13.1 million or 33.1% during this same period.  As a result of this improvement, the Company recorded a negative provision for loan losses of $550,000 in the third quarter of 2011 compared to a $1.0 million provision in the third quarter of 2010.  For the nine month period in 2011 the negative provision has amounted to $2,325,000 compared to a $5,250,000 provision in the first nine months of 2010.  Actual credit losses realized through net charge-offs have also declined sharply on both a quarterly and year-to-date basis in 2011.  For the first nine months of 2011, net charge-offs totaled $1.4 million or 0.28% of total loans which represents a decrease from the first nine months of 2010 when net charge-offs totaled $4.2 million or 0.79% of total loans.  When determining the provision for loan losses, the Company considers a number of factors some of which include periodic credit reviews, non-performing asset loan delinquency and charge-off trends, concentrations of credit, loan volume trends and broader local and national economic trends.  In summary, the allowance for loan losses provided 301% coverage of non-performing loans and was 2.41% of total loans at September 30, 2011, compared to 145% of non-performing loans and 2.91% of total loans at December 31, 2010.

The Company’s non-interest income in the third quarter of 2011 increased by $11,000 from the prior year’s third quarter and for the first nine months of 2011 decreased by $118,000 or 1.2% when compared to the first nine months of 2010.  The largest positive item in 2011 has been increased trust and investment advisory fees.  Specifically, trust and investment advisory fees increased by $214,000 for the third quarter and $602,000 or 12.8% for the nine month period as these wealth management businesses benefited from the implementation of new fee schedules and higher equity values in the first half of 2011.  When compared to the prior year, gains realized on residential mortgage loan sales into the secondary market were down by $92,000 for the third quarter due to less refinance activity but have increased by $35,000 for the nine month period due to increased mortgage loan production in the first quarter of 2011.  The largest item causing the 2011 decline in non-interest income for the nine month period was a $358,000 loss realized on the sale of $17 million of investment securities in the first quarter of 2011.  The Company took advantage of a steeper yield curve to position the investment portfolio for better future earnings by selling some of the lower yielding, longer duration securities in the portfolio and replacing them with higher yielding securities with a shorter duration.  The Company recognized $157,000 of investment security gains in 2010.  Other income in 2011 also decreased by $103,000 in the third quarter and by $42,000 for the nine month period due to fewer letter of credit fees and a $26,000 loss realized on the sale of an OREO property in the third quarter of 2011.      

Total non-interest expense in the third quarter of 2011 increased by $108,000 from the prior year’s third quarter and for the first nine months of 2011 increased by $354,000 or 1.2% when compared to the first nine months of 2010.  Salaries and employee benefits increased by $287,000 for the third quarter and $926,000 or 5.8% for the nine month period due to higher medical insurance costs, increased pension expense, and greater incentive compensation expense.  Professional fees dropped by $51,000 in the third quarter and $376,000 or 11.6% for the first nine months of 2011 due to reduced legal fees, recruitment fees, and lower consulting expenses in the Trust Company.  Other expenses also declined by $54,000 for the third quarter and $491,000 for the nine month period due to a reduction in costs associated with the reserve for unfunded loan commitments and lower telephone expense resulting from the implementation of technology enhancements.  Finally, the Company recorded an income tax expense of $2.1 million for the first nine months of 2011 compared to an income tax benefit of $189,000 recorded in the first nine months of 2010 due to the sharply higher pre-tax earnings in 2011 compared to a modest pretax loss in the first nine months of last year.

ASRV had total assets of $973 million and shareholders’ equity of $114 million or a book value of $4.39 per common share at September 30, 2011.  The Company continued to maintain strong capital ratios that considerably exceed the regulatory defined well capitalized status with a risk based capital ratio of 17.31%, an asset leverage ratio of 11.70% and a tangible common equity to tangible assets ratio of 8.38% at September 30, 2011.  In the third quarter, the Company also participated in the U.S. Treasury’s Small Business Lending Fund by selling $21 million in preferred stock to the Treasury and using all the proceeds to redeem preferred stock issued to the Treasury as part of the TARP program. The initial interest rate on the SBLF funds will be 5% and may be decreased to as low as 1% if growth thresholds are met for increasing small business loans.

This news release may contain forward-looking statements that involve risks and uncertainties, as defined in the Private Securities Litigation Reform Act of 1995, including the risks detailed in the Company's Annual Report and Form 10-K to the Securities and Exchange Commission.  Actual results may differ materially.  

Nasdaq: ASRV

SUPPLEMENTAL FINANCIAL PERFORMANCE DATA

September 30, 2011

(In thousands, except per share and ratio data)

(Unaudited)

2011

2010

AMERISERV FINANCIAL, INC.

(In thousands, except per share, statistical, and ratio data)

(Unaudited)

2011

2010

NOTES:

(A)

Preferred stock of $21 million received through the Small Business Lending Fund is excluded from the book value per

common share calculation.

        (B) Not recognized on the balance sheet.

AMERISERV FINANCIAL, INC.

CONSOLIDATED STATEMENT OF INCOME

(In thousands)

(Unaudited)

2011

2010

AMERISERV FINANCIAL, INC.

Nasdaq: ASRV

Average Balance Sheet Data (In thousands)

(Unaudited)

2011

2010