NewportFed 1Q profit rises to $259,000

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NEWPORT – Newport Bancorp Inc. (Nasdaq: NFSB), the holding company for Newport Federal Savings Bank, has reported a first-quarter profit of $259,000 or 6 cents per share compared with net income of $25,000 in the first quarter of 2006, before the company went public.

Net interest and dividend income increased 15.6 percent to $2.4 million from the year-ago period.

Non-interest income increased 42.7 percent year-over-year to $555,000, fueled by growth in customer-service fees and bank-owned life insurance.

“Despite a flat yield curve, which has caused a prolonged period of interest-rate difficulties, we have managed to maintain and in fact improve our net interest margin by 34 basis points when compared to the prior-year quarter,” said Kevin McCarthy, NewportFed’s president and CEO. “This improvement has been driven by consistent growth in the bank’s loan portfolio.”

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Assets increased 4.5 percent over the quarter to $303.6 million on March 31 from $290.4 million on Dec. 31.

Net loans increased 3.3 percent over the quarter to $265.2 million, while bank-owned life -insurance increased 66.8 percent to $9.0 million. Cash and cash equivalents increased by 17.1 percent over the quarter.

Newport Bancorp Inc. (Nasdaq: NFSB) is the holding company for Newport Federal Savings Bank (NewportFed), a $303 million institution created by the 2005 merger of NewportFed and Westerly Savings Bank. It converted from a mutual bank to a shareholder institution in mid-2006. Additional information is available at www.newportfederal.com.

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