Westfield Financial Inc., the holding company for Westfield Bank, reported net income of $974,000 for the quarter ended June 30, compared with $2.3 million, for the three months ended March 31 and $1.6 million for the second quarter last year.

Net income for the second quarter 2012 was negatively impacted by the redemption of bank-owned life insurance (BOLI), the company said. Management redeemed certain BOLI policies because of a sudden downgrade in the credit ratings of the insurance carrier and the carrier’s decision to close out its individual life policies to new sales. The redemption of BOLI resulted in an additional income tax provision of $160,000 and a charge to noninterest income of $102,000 for transferring the policies to a different carrier.

On July 24, the board of directors declared a regular cash dividend of 6 cents a share, payable Aug. 23 to shareholders of record on Aug. 9.

For the six months ended June 30, net income was $3.3 million, or 13 cents a share, compared with $2.9 million or 11 cents a share, for the same period in 2011.

Net interest and dividend income increased $310,000 and the net interest margin increased 3 basis points from the first quarter 2012. Total loans increased by $25.6 million to $584 million, mainly as the result of an increase in residential loans of $21.6 million and commercial and industrial loans of $3.7 million.

Total assets were $1.3 billion at June 30, an increase of $25 million compared with March 31. Total loans increased by $25.6 million to $584 million at June 30 from $558.4 million at March 31. Residential loans increased $21.6 million to $222.8 million at June 30 from $201.2 million at March 31. Commercial and industrial loans increased $3.7 million to $123.7 million at June 30 from $120million at March 31.

Total deposits were $747.6 million at June 30compared with $748.6 million at March 31.