Net interest income boosted year-over-year earnings 13 percent to $607,000 at Wellesley Bancorp during the third quarter this year.
Net interest income for the quarter totaled $3.6 million, a 24 percent increase over $2.9 million during the same period last year. The holding company for Wellesley Bank attributed this increase to its expanded loan portfolio, chiefly in residential mortgage and construction loan origination.
Rising noninterest expenses partially offset that increase, however. For the three months ended Sept. 30, noninterest expenses increased $499,000, or 23.8 percent, to $2.6 million, compared with $2.1 million for the same period last year. The company attributed this largely to an increase in salaries and employee benefits, the result of staff additions and costs associated with an equity incentive plan adopted in August of last year, and a $124,000 increase in advertising and marketing costs needed for a recent rebranding campaign.
Total assets came to $421.1 million at Sept. 30, representing an increase of $45.1 million compared with $376 million at Dec. 31, 2012. The increase was reflected as an increase in loans held in portfolio, while loans held for sale declined during the period.
Over that same period, net loans increased $62.1 million, or approximately 21 percent, to $356.2 million. Residential mortgage loans increased $36.5 million due to growth in the bank’s adjustable-rate mortgage portfolio. Construction loans, primarily residential, increased $22.9 million. Loans held for sale balances decreased due to lower customer demand for longer-term fixed rate mortgages, which reduced the bank’s production of these loans.
Deposits increased $29.4 million to $327.4 million at Sept. 30, largely because of a $12.5 million increase in certificate of deposit accounts, a $9.7 million increase in savings accounts and a $5.6 million increase in demand deposit accounts, partially offset by a decrease in NOW checking accounts of $1.5 million. Federal Home Loan Bank advances, including short-term borrowings, increased $14 million from Dec. 31, 2012, as these funds were used to support the portfolio loan growth.
