PROVIDENCE – Independent Bank Corp. saw a 27% rise in quarterly profits as it continues to reap the benefits of a $1.2 billion acquisition of another Massachusetts bank.
The parent company for Rockland Trust Co. on April 21 reported $53.1 million in first-quarter earnings, with higher profits driven largely by the prior-quarter deal to acquire Peabody-based Meridian Bancorp Inc. and its bank, East Boston Savings Bank.
Although the acquisition closed in November 2021, the company incurred $7.1 million in merger costs in the first quarter of 2022.
Earnings per diluted share fell 11% year over year to $1.12.
While based in Rockland, Mass., Rockland Trust operates a commercial lending and investment office in Providence, and has bank branches in Seekonk and Attleboro.
Interest income rose 41.1% to $140.6 million thanks to the Meridian acquisition, although this was partially offset by declining revenue from the now-ended Paycheck Protection Program, the company stated.
Interest expenses were down 21.4% to $3.2 million, which together with higher interest income created a 43.8% jump in net interest income.
Net interest margin – the difference between interest income generated and the amount of interest paid out to lenders – fell 16 basis points to 3.09%.
Noninterest income ticked up 4.1% to $26.3 million, with increases in deposit account, interchange and ATM fees that were partially offset by lower mortgage banking income due to lower volumes and fewer loans sold to the secondary market.
These gains were partially offset by a 37.1% jump in noninterest expenses to $95.5 million. This included a 22% rise in employee compensations and benefits due to the added workers from the Meridian acquisition, the company stated.
The company also recorded a $17.1 million quarterly provision for income taxes, which was 43.3% higher than a year ago, due to the acquisition.
Total quarterly assets increased 46.4% to $20.2 billion, including $13.6 billion in loans and leases. The 46.9% jump in loans was driven by strong commercial real estate and commercial construction loan growth, as well as gains in residential real estate. This was partially offset by lower commercial loans from now-forgiven PPP loans.
Total deposits stood at $16.8 billion, a 44.6% increase year-over-year with growth across all types of deposit accounts.
“We are off to a great start in 2022,” Christopher Oddleifson, CEO of Independent Bank Corp. and Rockland Trust Co., said in a statement. “We are very pleased with the outcome of all our hard work on the integration of East Boston Savings Bank and are enjoying building relationships with our new colleagues, customers and communities.”
Nancy Lavin is a PBN staff writer. Contact her at Lavin@PBN.com.
