Westfield Financial’s pending merger with Chicopee Bancorp put a dent in its bottom line, the company saw gains in both commercial real estate and residential real estate loans.
Net income at the holding company for Westfield Bank totaled $389,000 in the quarter ended June 30 and $2.4 million in the six months ended June 30, compared with $1.4 million and $2.7 million, respectively, in the year-ago periods. The company said in its earnings statement that the quarter and six months included non-recurring expenses related to the coming merger totaling $929,000 and $1.1 million, respectively. The deal is anticipated to close in the fourth quarter.
“We’re very excited about our previously announced pending merger with Chicopee Bancorp and continue to work diligently through the approval process,” President and CEO James C. Hagan said. “The complimentary nature of our branch footprints creates opportunity for growth and expansion into new markets for Westfield, which will be extremely favorable for the shareholders, customers, employees and communities of both institutions.”
Net interest and dividend income increased $223,000 year-over-year to $8 million in the second quarter. Over that time, net interest margin increased 12 basis points to 2.62 percent for the quarter ended June 30.
Total loans increased 19.3 percent, or $146.8 million, year-over-year to $906.2 million at June 30, largely due to a $96.9 million increase in residential loans and a $50.7 million increase in commercial real estate loans. Commercial and industrial loans, however, fell $3.8 million over that time.
The allowance for loan losses totaled $9.6 million, $8.9 million and $8.3 million at June 30, March 31, 2016 and the year-ago quarter, representing 1.06 percent, 1.07 percent and 1.09 percent of total loans, respectively. That represents 119 percent, 106.8 percent and 103.5 percent of nonperforming loans, respectively. The provision for loan losses of $625,000 recorded in the second quarter was primarily the result of growth in the loan portfolio.
Total deposits increased 2.6 percent year-over-year to $920.9 million.
Total assets ticked down 2.7 percent year-over-year to $1.3 billion.
