| Loan growth pushed up Independent Bank Corp.’s earnings slightly in the third quarter as the company closed in on one acquisition and began another.
Net income at the Rockland Trust parent totaled $20.5 million, compared with $20.4 million in the prior quarter and $18.6 million in the year-ago quarter. Year-over-year, that represented an increase of 10.16 percent.
The third and second quarters this year both contained merger and acquisition expenses, and the company announced on the same day as its earnings release that it would be acquiring Edgartown National Bank in Martha’s Vineyard. Independent also recently received regulatory approval for its pending acquisition of the Bank of Cape Cod, which is expected to close around Nov. 10.
“We are on a bit of a roll in working with smaller banks that are attractively accretive to our earnings potential, and our ability to not dilute book is quite noteworthy,” President and CEO Christopher Oddleifson said on a conference call. “The wonderful thing about smaller transactions is you can really take your time and make sure you do it right.”
The Edgartown National acquisition will add $171 million in deposits, $153 million in loans and four branches to Rockland Trust’s books. The Bank of Cape Cod deal will add $214 million in deposits and $229 million in loans.
The bank’s total assets increased 5.2 percent year-over-year to $7.5 billion at Sept. 30.
Its commercial loan portfolio increased 5.46 percent from the year-ago period to $4.1 billion, driven mainly by growth in commercial real estate. The bank also increased its home equity loan portfolio 1.7 percent from the prior quarter and 6.3 percent from the year-ago quarter.
Total loans increased $248 million, or 4.5 percent, to $5.7 billion.
Total deposits increased $354.6 million, or 6 percent, year-over-year to $6.3 billion, driven by growth in demand deposit and money market categories.
Net charge-offs totaled $472,000 or 0.03 percent of average loans on an annualized basis, compared with $695,000 in net recoveries in the prior quarter.
The provision for loan losses increased to $950,000 for the third quarter from $600,000 in the second quarter. Nonperforming loan levels in the third quarter decreased slightly to $24.8 million, and represented 0.43 percent of total loans at Sept. 30, compared with 0.45 percent at June 30. Total nonperforming assets decreased to $26.6 million at the end of the third quarter, from $27.5 million at the end of the prior quarter. Delinquency as a percentage of loans was 0.44 percent at Sept. 30, a decrease of three basis points from the prior quarter.
The allowance for loan losses was $58.2 million at Sept. 30, 2016, as compared to $57.7 million at June 30, 2016. The company’s allowance for loan losses as a percentage of loans was 1.01 percent and 1.02 percent as of Sept. 30, 2016, and June 30, 2016, respectively.
