Westfield Financial recorded a drop in earnings during the second quarter as the company increased its provision for loan losses to keep up with loan growth.

For the quarter ended June 30, the holding company for Westfield Bank posted $1.3 million in net income, compared with $1.6 million for the same period a year ago.

Last year in the second quarter, Westfield actually recorded a $70,000 credit to its provision for loan losses, whereas this year, the company set aside $450,000 to cover possible loan losses.

Total loans increased 13.1 percent, or $79.5 million, to $686.1 million at June 30. That included a $42.3 million increase in commercial real estate loans, a $19.2 million increase in commercial and industrial loans and an $18 million increase in residential loans.

"Our loan growth initiatives continue to be successful, and I’m pleased with what we have achieved over the past four quarters. Through our continuous calling efforts, we have been able to capitalize on opportunities using our commercial lending expertise along with providing a personalized customer experience with local decision making," President and CEO James C. Hagan said in a statement.

Hagan also said the company’s middle market commercial lending group would be moving to downtown Springfield to gain better access to borrowers and centers of influence in both the Greater Springfield area and northern Connecticut.

Net interest and dividend income increased slightly to $7.7 million for the quarter, compared with $7.6 million in the year-ago period. Noninterest income also increased to $1 million, from $963,000 last year.

Total deposits increased $35.9 million, or 4.6 percent, to $818.6 million at June 30, compared with $782.7 million last year.

The company’s allowance for loan losses totaled $8 million at June 30, compared with $7.5 million last year, representing 248.6 percent and 228.4 percent, respectively, of nonperforming loans.

During the second quarter this year, nonperforming loans increased $130,000 to $3.2 million from March 31, representing 0.47 percent of total loans at the quarter’s end. That increase was due primarily to one commercial and industrial loan relationship, the bank said in its statement. Loans delinquent 30 to 89 days totaled $5.5 million at June 30, and $5.4 million at March 31. There are no loans 90 or more days past due and still accruing interest.