Century Bancorp increased its net income for the quarter ended March 31 to $4.9 million, up 10.2 percent from $4.5 million during the same period last year.
The Medford-headquartered holding company for Century Bank also boosted its total assets 2 percent to $3.5 billion during that timeframe.
Net interest income increased 13.5 percent, from $14.5 million last year to $16.5 million this year, due largely to an increase in average earning assets. The company’s net interest margin also increased from 2.25 percent to 2.27 percent on a fully taxable equivalent basis, mainly due to a decrease in rates paid on deposits and borrowed funds. An increase in deposit balances meant a slight increase in interest expenses, and the average balances of earning assets increased 13 percent.
The company decreased its provision for loan losses by $150,000 to $600,000 for the quarter ended March 31, primarily due to changes in its portfolio composition.
There were no realized gains on sales of investments for that quarter, compared with $883,000 for the same period last year. The company’s effective tax rate decreased from 6 percent in 2013 to 5.6 percent in 2014 primarily as a result of an increase in tax-exempt income.
At March 31, total equity was $182.1 million compared with $176.5 million at Dec. 31, 2013. The company’s equity increased primarily as a result of earnings and a decrease in other comprehensive loss, net of taxes, offset somewhat by dividends paid. Other comprehensive loss, net of taxes, decreased as a result of a decrease in unrealized losses on securities available-for-sale and securities transferred from available-for-sale to held-to-maturity.
The company’s leverage ratio stood at 6.57 percent at March 31, compared with 6.5 percent at Dec. 31, 2013. The increase in the leverage ratio was due to an increase in stockholders’ equity, offset somewhat by an increase in assets. Book value as of March 31 was $32.77 per share compared with $31.76 at the end of 2013.
Allowance for loan losses totaled $21.3 million or 1.68 percent of loans outstanding at March 31, compared with $20.9 million or 1.66 percent of loans outstanding at Dec. 31, 2013 and $19.8 million or 1.74 percent of loans outstanding in the year-ago period. The increase in the allowance for loan losses was due to the composition of the loan portfolio as well as qualitative factors. Non-performing assets totaled $1.6 million at March 31, compared with $2.5 million at Dec. 31, 2013 and $4.1 million at March 31, 2013.
The board of directors voted a regular quarterly dividend of 12 cents per share on the company’s Class A common stock, and 6 cents per share on the company’s Class B common stock. The dividends were declared payable May 15 to stockholders of record on May 1.
