Cambridge Bancorp, the holding company for Cambridge Trust Company, reported a modest increase in its net earnings in this year’s first quarter, largely attributing the increase to growth in noninterest income offset by lower net interest income and higher noninterest expense.

The company’s net income increased 1.4 percent, or $46,000, from $3.28 million to $3.33 million from the same time period last year.

"The bank is off to a solid start in the first quarter of 2013," Joseph V. Roller II, president and CEO, said in a statement. "It is clear the banking industry will continue to be challenged with a low interest environment and uncertain regulatory changes. Cambridge Trust continues to benefit from investments made across the Company and remains focused on executing its business plans."

Net interest income dipped about 4.5 percent, to $11 million this year compared with $11.5 million last year. However, noninterest income was up 22.6 percent, or $1.1 million, to $5.9 million, compared with $4.8 million last year.

The bank also grew wealth management income, which increased 12 percent, or $402,000, between the comparable periods, from new account growth and market appreciation. Assets under management grew to $1.9 billion at the end of the first quarter 2013 from $1.8 billion at year-end 2012. Other contributors to the noninterest income increase for the first quarter of 2013 were income produced from gains on loans sold of $298,000, a new source of revenue since the second quarter of 2012, and gains from the disposition of investment securities of $343,000 compared to the first quarter of 2012.

Total loans outstanding increased 11.9 percent, or $8.23 million to $773.7 million year-over-year. The bank attributed its first quarter loan growth primarily to increases in residential mortgages – $22 million or 6.4 percent – and commercial mortgages – $15.2 million or 5.5 percent.