Independent Bank Corp., the parent company of Rockland Trust Co., recorded net income totaling $50.3 million last year, compared with $42.6 million in the previous year, despite accounting for $6.2 million in merger and acquisition costs in the fourth quarter.
The parent company of Rockland Trust Co. acquired Mayflower Bancorp on Nov. 15, 2013, adding four full-service branches, $126.6 million in loans and $218.9 million in deposits. Independent Bank Corp. recorded fourth quarter net income of $10.6 million, after accounting for costs related to the deal.
Inclusive of the Mayflower acquisition, total assets increased 5.9 percent year-over-year to $6.1 billion. That amounts to a quarterly increase of $203.8 million, or 3.5 percent.
Organic loan growth increased $72.7 million, or 1.6 percent, on a year-over-year basis. Specifically, the company increased its commercial loan portfolio $55 million, or 6.8 percent on an annualized basis, between the third quarter of last year and the fourth. Commercial real estate and commercial and industrial (C&I) loans increased 8.1 percent and 12.8 percent, respectively. A decline in the commercial construction portfolio somewhat offset this increase, though.
While prepayment activity on the residential loan portfolio leveled off during the quarter, it still outpaced new originations, resulting in an $18.3 million, or 14.6 percent, decline from the third quarter.
Though Independent Bank Corp. recorded increases in some areas of its non-interest income – such as deposit account fees, interchange and ATM fees, investment management income and capital gain distributions – the company saw its noninterest income decline 3.7 percent overall to $17.5 million. In particular, mortgage banking income declined $902,000, or 48.9 percent during the quarter, which is consistent with an industry-wide decline in volume during this period.
The company increased its provision for loan losses in the fourth quarter to $3.2 million from $2.7 million in the third quarter. Net charge-offs totaled $3.5 million during that period, up $1.4 million from the prior quarter, or 0.3 percent on an annualized basis of average loans. For the year, net charge-offs totaled 0.19 percent of average loans. Nonperforming loans declined to $34.7 million, or 0.73 percent of total loans, on a quarterly basis. Nonperforming assets declined to $43.8 million in the fourth quarter, from $48.9 million in the linked quarter.
The allowance for loan losses totaled $53.2 million at Dec. 31, consistent with the prior quarter levels. The company’s allowance for loan losses was 1.13 percent and 1.18 percent of total loans at Dec. 31, and Sept. 30, respectively. Loans acquired in connection with the Mayflower acquisition were recorded at fair value, including a reduction for estimated credit losses, and without carryover of the respective portfolio’s historical allowance for loan losses.
