Cambridge Bancorp posted a 5 percent increase in net income last year, boosted by growth in lending and wealth management fee income.
Net income for the year ended Dec. 31 totaled $15.7 million, compared with $14.94 million in 2014.
“We are pleased to report the bank delivered another record earnings year with robust core deposit and loan growth,” said Denis K. Sheahan, president and CEO. “Cambridge Trust posted strong profitability metrics for the year with return on average assets of 0.95 percent and return on average stockholders’ equity of 12.91 percent.”
Core deposits grew 9.5 percent year-over-year to $1.6 billion, and loans increased 10.3 percent to $1.2 billion. Commercial mortgages increased $69.2 million, or 15.7 percent; residential mortgages increased $39 million, or 7.7 percent; and home equity loans increased $6.9 million, or 12.3 percent.
Net interest income increased $3.4 million, or 7 percent, to $51.6 million at year-end 2015. Loan growth in 2014 and 2015 helped to boost interest income from loans by $4.9 million, or 12 percent. The bank’s net interest margin declined six basis points to 3.27 percent at year-end 2015.
Noninterest income totaled $25.9 million for the year 2015 compared with $24.5 million in 2014, with the bank’s wealth management business driving most of that increase. Wealth management income increased by $1.3 million, or 7.2 percent, to $19.2 million compared with $18 million in 2014. Assets under management totaled $2.3 billion at year-end 2015.
Those gains in noninterest income were offset by lower gains on disposition of investment securities of $383,000, lower deposit account fees of $92,000, lower other income of $58,000, and lower ATM and debit card fees of $55,000 for the year ended Dec. 31.
As part of overall balance sheet management, the bank sold more of its long-term residential mortgage production. Income from gains on loans sold ended $439,000 higher for 2015 versus 2014. During the fourth quarter of 2015 the bank began to offer loan level derivative contracts to manage commercial loan interest rate risk. This activity generated $260,000 in loan related derivative income for the quarter.
Total assets at year-end 2015 were $1.7 billion versus $1.6 billion year-end 2014.
