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Cambridge Trust recorded a $2.7 million decline in non-interest, non-recurring expenses which resulted in a higher net income in the fourth quarter.
The bank, whose acquisition by Eastern Bank is expected to close early next quarter, did not hold an earnings call and only issued a press release Monday alongside its quarterly financial filings.
Net income in the fourth quarter went up to $8 million from $6.5 million the prior quarter as it observed lower non-operating costs, professional fees (consulting, legal, and employment agency fees), and marketing expenses amid the ongoing merger process with Eastern Bank.
Cambridge Trust’s net interest income, before provision for credit losses, went down to $28.2 million from $28.6 million the previous quarter as the higher cost of funds outpaced the higher yields in assets.
Total loans were flat in the fourth quarter at $4.02 billion, the same as the third quarter as the growth in commercial real estate and home equity loans was offset by the declines in business and consumer loans.
Excluding wholesale, total deposits decreased by 1.3 percent to $4.03 billion from $4.08 billion last quarter as the deposit market remains competitive. The bank said it reduced higher-priced wholesale certificates of deposit, and replaced it with more borrowing from the Federal Home Loan Bank of Boston.
The bank’s cost of deposits was up to 2.19 percent from 2.09 percent a quarter ago.
Cambridge Trust’s earnings announcement said its non-performing loans increased to $16.6 million or 0.41 percent of total loans from $7.8 million in the third quarter, equivalent to 0.19 percent of loans. The announcement said this is due to one owner-occupied commercial mortgage loan that went into non-accrual or non-paying status during the quarter. Factoring this, the bank increased its provision for credit losses to $569,000 from $195,000 in the third quarter.
Cambridge Trust and Eastern Bank, when merged, will create a $28.5 billion asset bank, with Eastern Bank as the surviving entity and the Cambridge Trust brand used in the wealth management business.
