ROCKLAND, Mass. – Independent Bank Corp. (Nasdaq: INDB), the parent of Rockland Trust Co., posted a third-quarter profit of $8.81 million for the three months ended Sept. 30, an increase of 6.05 percent from the year-ago $8.31 million, on total revenue that rose 31.80 percent year-over-year to $53.80 million.
The company cited “a combination of the [Slade’s Ferry Bancorp] acquisition in the first quarter of this year and organic growth.” Third-quarter diluted earnings per share dipped to 54 cents from the year-ago period’s 60 cents.
“I’m very happy with both our third-quarter performance and year-to-date earnings results, especially given the tumultuous market conditions,” President and CEO Christopher Oddleifson said in a statement last night.
Non-interest income rose $812,000, or 10.52 percent, to $8.53 million, as wealth-management income rose 47.33 percent to $2.76 million and service charges rose 8.76 percent to $4.08 million, more than offsetting a decline in mortgage-banking income, which fell 19.58 percent year-over-year to $501,000.
Interest income rose $5.42 million, or 13.60 percent, to $45.27 million led by a 15.74-percent increase in interest on loans. Net interest income after provision for loan losses rose $5.077 million, or 21.28 percent, to $29.05 million.
For the three months ended Sept. 30, the company’s provision against loan losses amounted to 1.29 percent of loans, the same as the preceding quarter’s. The total set aside against such losses rose to $2.07 million – 8.95 percent more than the second quarter’s $1.9 million provision (READ MORE) and nearly six times the year-ago period’s $300,000 provision against loan losses. (READ MORE)
“Net charge-offs increased in the third quarter of 2008, primarily due to partial charge-offs in the home equity portfolio resulting from a thorough review … conducted during the quarter,” the company added. Third-quarter net charge-offs rose to $2.0 million from the year-ago $758,000.
Total assets amounted to $3.48 billion at quarter’s end, an increase of 25.60 percent since Dec. 31 and 2.65 percent since the second quarter’s end on June 30. Total loans amounted to $2.55 billion on Sept. 30, an increase of 26.56 percent from year’s end and 0.4 percent from the preceding quarter.
Year-to-date loan growth amounted to $542.6 million, with the Slades purchase accounting for $471.2 million of the total, the company said. “Excluding the Slades acquisition, loan growth achieved in the first nine months of 2008 amounted to $71.4 million, or 4.7 percent on an annualized basis, and was concentrated in the commercial (7.8 percent annualized) and home equity (19.0 percent annualized) lending categories.”
Total liabilities and stockholder equity also grew, to $3.48 billion on Sept. 30, an increase of 25.60 percent for the year and 2.65 percent for the third quarter. Deposits rose 25.24 percent over the first nine months of the year to $2.54 billion, or 2.58 percent more than at the end of the second quarter.
“Of the year-to-date deposit increase, $401.8 million is a result of the March 2008 acquisition,” the company said. “Excluding the impact of the Slades acquisition, total deposits increased at an annualized rate of 6.6 percent.”
Independent’s return on average equity rose to 11.57 percent from the second quarter’s 10.70 percent, but continued to lag the year-ago period’s 15.57 percent return. Return on average assets rose to 1.04 percent from the second quarter’s 0.97 percent but fell short of the year-ago 1.24 percent.
The bank’s net interest margin widened to 4.09 percent from the second quarter’s 4.01 percent and the 2007 third quarter’s 4.00 percent.
Merger and acquisition costs, related to the Slades Ferry acquisition this March, amounted to $1.1 million in the first nine months of the year, the company said.
“Our conservative management philosophy, combined with the strong relationships we continue to build within the communities that we do business, positions us well for continued future growth,” Oddleifson said. “Many consumers and businesses realize that Rockland Trust is both safe and strong, and are turning to us to establish long-term relationships.”
Earlier this month, Independent shares were upgraded to “outperform,” from the previous “neutral,” by analysts at the firm of Robert W. Baird. (READ MORE) [The firm and its founder have no ties to PBN Web Editor Susan A. Baird.]
Independent Bank Corp. (Nasdaq: INDB) is the parent of Rockland Trust Co., a full-service community bank with assets of $3.5 billion that serves southeastern Massachusetts, Cape Cod and Rhode Island. Rockland Trust has 63 retail branches, nine commercial lending centers, five mortgage-origination offices and four investment-management offices, one of which is in Rhode Island. Additional information is available at www.RocklandTrust.com.
