Wellesley Bancorp Inc. the holding company for Wellesley Bank, reported a decline in net income of $32,000, dropping to $434,000 for the quarter ended June 30, compared to net income of $466,000 for the same period in 2011.

For the first six months of the year, the company reported a net loss of $119,000, compared to net income of $958,000 for the same period in 2011. The bank completed its mutual-to-stock conversion and the company’s public offering on Jan. 25, 2011. The 2012 results reflect a one-time $1.8 million pre-tax contribution ($1.1 million after-tax) to the Wellesley Bank Charitable Foundation formed in connection with the conversion.

Despite the loss in net income, the bank decreased its provision for loan losses to $100,000 in the second quarter compared to $300,000 for the same time in 2011, due to the bank having successfully resolved certain impaired loans. Net interest income increased 11.9 percent to $2.8 million for the second quarter from $2.5 million in the comparable 2011 period, due to growth in the bank’s loan portfolio, and a reduction in interest expense as the bank paid off a portion of  Federal Home Loan Bank (FHLB) advances, and replaced them with lower costing long-term advances. Deposit costs also declined due to lower interest rates.

Noninterest expense increased $573,000 to $2.2 million, compared to $1.6 million for the comparable 2011 period. Salaries and employee benefits were $1.2 million for the second quarter, compared to $944,000 in 2011, due to a new branch which opened in April 2012, and to the hiring of a new president of Wellesley Investment Partners, our investment advisory subsidiary.

Total assets were $324.6 million at June 30, representing an increase of $21.5 million compared to December 2011.