PROVIDENCE – Brookline Bancorp Inc. saw a modest rise in earnings, which reached $30.1 million as of Sept. 30, the company reported on Thursday.
The latest profits for the Boston-based parent company of Bank Rhode Island mark a 4.5% increase over the third quarter of 2021. Earnings per diluted share rose 2 cents to 39 cents per share.
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The increase in earnings comes as the company prepares to finalize a $313 million acquisition of New York-based PCSB Financial Corp., which is expected to close in the fourth quarter. To that end, the company reported $1 million in merger-related costs in the third quarter, compared with zero merger costs a year ago.
The costs associated with the pending deal were counteracted by higher interest rates, which lifted interest income 14.1% to $88.6 million. Also reflecting recent interest rate hikes, net interest margin – the difference between interest income generated and the amount paid out – increased 27 basis points to 3.80%.
Non-interest income of $6.8 million marked a 22.3% year-over-year increase, driven by a nearly six-fold increase in net loan level derivative income. Non-interest expenses rose 9.9% to $45 million, with higher compensation and employee benefit costs in addition to merger-related expenses.
The company also added $2.8 million to its loan loss reserves, mirroring actions taken by other banks in anticipation of a potential economic downturn. By contrast, the company shed $3.1 million in credit loss provisions in the third quarter of 2021.
Total quarterly assets stood at $8.7 billion, up 4.6% year over year. This included a 7.1% increase in total loans to $7.4 billion, with the largest gains in commercial real estate loans.
Total deposits of $6.7 billion were down 2% compared with a year ago due to losses in certificate of deposit and brokered deposit accounts, partially offset by gains in demand checking and money market accounts.
“We experienced another near-record quarter of earnings in the third quarter led by our experienced team of bankers who continue to generate solid loan growth while maintaining asset quality,” Paul Perrault, Brookline Bancorp chairman and CEO, said in a statement.
Brookline’s earnings report did not break out the performance of Providence-based Bank Rhode Island. Brookline Bancorp is also the parent company for Brookline Bank and First Ipswich Bank in Massachusetts. Bank Rhode Island has the fifth-highest share of in-state deposits in Rhode Island as of June 30 at $2.6 billion, according to the Federal Insurance Deposit Corp.
Nancy Lavin is a PBN staff writer. You may reach her at Lavin@PBN.com.
