iStock illustration

Hingham Institution for Savings saw earnings increase 50 percent during the first nine months of 2021 compared to the same period last year.

Year-to-date through September, the Hingham-based bank had net income of $50.78 million, or $23.72 per share basic and $23.09 per share diluted, compared to $33.7 million or $15.79 per share basic and $15.46 per share diluted, in the first nine months of 2021.

Third quarter net income was $14.01 million or $6.54 per share basic and $6.36 per share diluted, compared to $15.2 million or $7.12 per share basic and $6.96 per share diluted, in the third quarter of 2020.

The bank’s net income for the first nine months of 2021 included a $2.3 million pre-tax gain from selling former branch properties in Weymouth and South Hingham, the bank said in a statement announcing its earnings. During the first nine months of 2020, the bank had a $218,000 pre-tax gain from the sale of its former branch in Scituate.

Hingham Institution for Savings’ board of directors increased its regular cash dividend to $0.53 per share, up 4 percent from the previous quarter.

While the banking industry has generally been seeing net interest margins go down, Hingham Institution for Savings has seen positive movement in this metric. The net interest margin for the third quarter was 3.48 percent compared to 3.46 percent in the previous quarter and in the third quarter of 2020. The net interest margin year-to-date through September increased by 34 basis points to 3.49 percent compared to the same period last year.

The bank said it has benefited this year from a sharp decline in the cost of interest-bearing liabilities, including retail and commercial deposits and wholesale funding, though the impact was less in the third quarter. The bank said it has also seen continued growth in non-interest-bearing deposit balances. A decline in the yield on interest-earning assets partially offset these benefits, the bank said, driven primarily by the decline in the interest on excess reserves held at the Federal Reserve Bank of Boston and a lower yield on loans during the same period.

Total deposits, including wholesale deposits, increased to $2.416 billion in the third quarter, which the bank said represented 17 percent annualized growth year-to-date and 19 percent growth from the third quarter of 2020.

Net loans increased in the third quarter to $2.8 billion, which the bank said represented 16 percent annualized growth year-to-date and 19 percent growth year-over-year. The bank said loan growth was concentrated in its commercial real estate portfolio.

Total assets were $3.16 billion on Sept. 30, up from $2.86 billion at the end of December.

The bank’s already low efficiency ratio continued to improve in the third quarter, falling to 21.29 percent compared to 23.5 percent in the same period last year. Operating expenses as a percentage of average assets remained the same as the previous quarter at 0.74 percent compared to 0.81 percent in the third quarter of 2020. The bank said it remained focused on reducing waste through an ongoing process of continuous improvement.

The bank closed another branch in Norwell last month, noting in the statement that it would explore options for maximizing the long-term value of the property through sale or lease.

“Returns on equity and assets were strong in the third quarter of 2021, although such performance should always be viewed cautiously, especially when tailwinds are blowing strongly in our favor,” Chairman Robert H. Gaughen Jr. said in the statement. “We remain focused on careful capital allocation, defensive underwriting and disciplined cost control – the building blocks for compounding shareholder capital through all stages of the economic cycle. These remain constant, regardless of the macroeconomic environment in which we operate.”