Berkshire Hills Bancorp’s second quarter earnings rose on loan growth this year, as it expanded its franchise across the Mid-Atlantic region.
The Pittsfield, Mass.-based holding company for Berkshire Bank posted net income totaling $16 million in the quarter ended June 30, compared with $10 million in the year-ago period. Earnings per share increased from 35 cents per share in the year-ago period to 52 cents per share in this year’s second quarter. The company noted in its earnings release that last year’s second quarter results included expenses related to its acquisition of Hamden Bancorp.
“Our commercial and retail teams posted solid growth in the second quarter of 2016,” CEO Michael Daly said in a statement. “This included the benefit of the Philadelphia area SBA lending business acquired during the quarter and operating as 44 Business Capital, a division of Berkshire Bank. Loan balances were up in all major lending categories and our total loan yield improved despite the ongoing market interest rate pressures. Profitability metrics also improved, including improved efficiency from our increased business scale.”
Total loans increased 4.8 percent to about $6 billion from $5.7 billion at year-end 2015. Commercial real estate loans totaled $2.2 billion in the second quarter, up 8.6 percent over that period, and commercial and industrial loans totaled just over $1 billion, down 1.3 percent over that time.
Total deposits ticked up about 1.2 percent to $5.7 billion from $5.6 billion at year-end 2015.
The company’s net interest margin stood at 3.31 percent at June 30, compared with 3.33 percent in the prior quarter and 3.30 percent in the year-ago quarter. Berkshire’s efficiency ratio improved to 58.71 percent from 59.86 percent in the prior quarter and 61.51 percent in the year-ago quarter.
Net loan charge-offs to average loans fell to 0.22 percent from 0.27 percent last year, and nonperforming assets were 0.26 percent of total assets, compared with 0.27 percent last year.
Berkshire recently announced it would acquire New Jersey-based First Choice Bancorp, but Daly wasn’t quite ready to think about another acquisition yet, judging from the company’s recent quarterly earnings call.
“I think there are a lot of deals out there we can do. Whether or not we do them is another question. We’re focused right now on getting through the First Choice acquisition,” he said in response to an investor’s question. “If there are other opportunities to look at, we’ll jump on them. But for us, there’s always a financial element to it.”
