In the last full quarter before its expected merger with Rockland Trust Co., East Boston Savings Bank saw profits rise 10% from the same quarter last year.
East Boston Savings Bank reported third quarter net income of $ 18.3 million, or $ 0.36 per diluted share, compared to $ 16.5 million, or $ 0.32 per diluted share, in the second quarter and $ 16.7 million, or $ 0.33 per diluted share, in the third quarter of 2020.
For the nine months ended September 30, net income was $ 59.2 million, or $ 1.17 per diluted share, an increase of 26% over the same period last year, when the net income was $ 46.9 million, or $ 0.93 per diluted share.
The bank saw its net interest income decline in the third quarter to $ 46 million, down $ 2.8 million, or 5.7%, from the third quarter of 2020. Net margin at interest was 3.05% compared to 3.13% in the third quarter of 2020.
The bank had the same net interest margin from January to September 2021 as it did in the first nine months of 2020, 3.07%. Net interest income increased $ 935,000 year-to-date, or 0.7%, to $ 142.2 million, from $ 141.3 million for the nine-month period ending September 30, 2020.
The bank saw its total interest and dividend income decline year-over-year by $ 9 million, or 14.6%, to $ 52.6 million in the third quarter. The bank said in its income statement that the drop in income was mainly due to a 12.8% drop in average loan balances.
The bank’s total interest expense declined year-over-year by $ 6.2 million, or 48.6 percent, to $ 6.6 million in the third quarter. Interest expense on deposits fell mainly due to a drop in the cost of average total deposits to 0.25% in the third quarter from 0.72% in the third quarter of last year, the bank said.
East Boston Savings Bank’s total assets were $ 6.1 billion as of September 30, down 7.4% from $ 6.62 billion at the end of 2020. Net lending rose to $ 4.85 billion in the third quarter, down 10.9% from Dec.31. $ 701.1 million in loan origination in the first nine months of 2021.
Total deposits stood at $ 4.69 billion at the end of the third quarter, down $ 388 million, or 7.6%, from $ 5.08 billion at the end of 2020. Core deposits, which exclude certificates of deposit, fell $ 50.3 million, or 1.3%, to $ 3.81 billion. , or 81.2% of total deposits, up from 76% at the end of 2020. The bank said the decline in core deposits included the repayment of $ 175.6 million in demand deposits paid by brokers.
Rockland Trust CEO Christopher Oddleifson said on the bank’s third quarter conference call on Friday that the banks were close to finalizing the merger in mid-November. Last week’s deal was still awaiting approval from the Massachusetts Banking Division.