2Q bank earnings top expectations

The second-quarter performances of most national and regional banks with branches in the area weren’t exactly stellar, but they beat the gloomy expectations of industry analysts.
Philadelphia-based Sovereign Bancorp Inc., the parent of Sovereign Bank, last week posted a $127.44 million profit for the quarter, a 13.57-percent decline from the same period a year ago.
Those results included a loan-loss provision of $132 million, 2.5 times the bank’s $51 million for the 2007 second quarter.
But with earnings per diluted share at 22 cents, Sovereign – the third-largest bank in Rhode Island in terms of deposits – exceeded analyst predictions by 8 cents.
Charlotte, N.C.-based Bank of America Corp., No. 2 in Rhode Island behind Citizens Bank, reported a 41-percent decline in profits for the second quarter to $3.41 billion, from $5.76 billion for the same period a year earlier. But investors will like the 72 cents a diluted share of earnings, which beat analyst predictions by 18 cents.
Even Waterbury, Conn.-based Webster Financial Corp., the parent of Webster Bank N.A., last week saw stock prices rise after posting a second-quarter loss of $28.94 million that was due in part to a $25 million provision against credit losses and a $54.92 million write-down of investments to fair value.
Loss per diluted share were 56 cents, but Webster – which has 10 branches in Rhode Island – said excluding certain cash and non cash charges, the adjusted earnings per share were 42 cents, 2 cents above the consensus of analysts.
Independent Bank Corp., however, bucked the trend.
The parent of Rockland Trust Co. earlier this year reported a 42.1 percent year-over-year gain in earnings for the second quarter, boosted by the purchase of Somerset, Mass.-based Slade’s Ferry Bank earlier this year.
Earnings per diluted share rose to 50 cents from the first quarter’s 44 cents, but still fell 5 cents below the consensus of analysts covering Rockland Trust.
NOTE: The Independent report was revised July 25 to reflect the current value of two investments. The bank pared its second-quarter profit to $6.84 million – for a still-impressive increase of 19.72 percent comppared with a year ago – and trimmed earnings by 8 cents per share to 42 cents. (READ MORE)
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